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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): July 26, 1995
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BUSH INDUSTRIES, INC.
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(Exact name of registrant as specified in its charter)
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Delaware 1-8884 16-0837346
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(State or other (Commission File (IRS Employer
jurisdiction of Number) Identification No.)
incorporation)
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One Mason Drive, Jamestown, New York 14702
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(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code (716)665-2000
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N/A
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(Former name or former address, if changed since last report)
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Item 5. Other Events.
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On July 26, 1995, Bush Industries, Inc. (the "Registrant"), entered into a
Credit Agreement (the "Credit Agreement") with Mellon Bank, N.A., as agent and
as a lender, The Chase Manhattan Bank, N.A., Chemical Bank, and Branch Banking
and Trust Company, pursuant to which the Registrant can borrow up to a maximum
of $75,000,000, on an unsecured basis. The credit facility replaces the
Registrant's previously enacted secured lending facility.
Pursuant to the terms of the Credit Agreement which expires July 31, 2000,
the Registrant must satisfy certain affirmative and negative covenants,
including maintaining certain financial ratios, at the time of any borrowing and
during the term of the loan. At the Registrant's option, borrowings may be
effectuated subject to certain conditions, on a base rate or euro-rate option.
Base rate loans will bear interest at the prime rate as announced by Mellon
Bank, N.A. from time to time, and euro-rate loans will bear interest at the then
current LIBOR rate, plus an applicable margin. The applicable margin which
pertains only to LIBOR rate loans varies from .50% to .95%, depending upon the
Registrant's ability to satisfy certain financial quarterly tests. In addition,
the Credit Agreement permits the Registrant to request the issuance of up to a
maximum $15,000,000 of letters of credit, which issuance will be deemed part of
the $75,000,000 maximum amount of borrowing permitted under the unsecured credit
facility.
Item 7. Financial Statements and Exhibits.
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(c) Exhibits.
10.1 Credit Agreement, dated as of July 26, 1995, by and among Bush
Industries, Inc., as Borrower, the Lenders party thereto from
time to time, the Issuing Bank referred to therein, and Mellon
Bank, N.A., as Agent.
10.2 Omitted Exhibits and Schedules to Credit Agreement.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Dated: BUSH INDUSTRIES, INC.
(Registrant)
By:
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CREDIT AGREEMENT
dated as of July 26, 1995
by and among
BUSH INDUSTRIES, INC.
as Borrower,
THE LENDERS PARTY HERETO FROM TIME TO TIME,
THE ISSUING BANK REFERRED TO HEREIN,
and
MELLON BANK, N.A.,
as Agent
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U.S. $75,000,000
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Table of Contents
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Section Title Page
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ARTICLE I DEFINITIONS; CONSTRUCTION............................. 1
1.01 Certain Definitions................................... 1
1.02 Construction.......................................... 16
1.03 Accounting Principles................................. 16
ARTICLE II THE CREDITS........................................... 16
2.01 Revolving Credit Loans................................ 16
2.02 Revolving Credit Commitment Fee....................... 17
2.03 Making of Loans....................................... 17
2.04 Interest Rates........................................ 18
2.05 Conversion or Renewal of Interest Rate Options........ 22
2.06 Prepayments Generally................................. 23
2.07 Optional Prepayments.................................. 23
2.08 Mandatory Prepayments................................. 24
2.09 Interest Payment Dates................................ 24
2.10 Pro Rata Treatment; Payments Generally;
Interest on Overdue Amounts......................... 24
2.11 Additional Compensation in Certain
Circumstances....................................... 25
2.12 Taxes................................................. 27
2.13 Funding by Branch, Subsidiary or Affiliate............ 28
ARTICLE III THE LETTER OF CREDIT SUBFACILITY 29
3.01 The Letter of Credit Subfacility...................... 29
3.02 Procedure for Issuance and Amendment
of Letters of Credit................................ 30
3.03 Letter of Credit Participating Interests.............. 32
3.04 Letter of Credit Drawings and
Reimbursements...................................... 32
3.05 Obligations Absolute.................................. 33
3.06 Additional Compensation in Certain
Circumstances....................................... 34
3.07 Further Assurances.................................... 34
3.08 Letter of Credit Agreement and Applications........... 34
3.09 Cash Collateral for Letters of Credit................. 34
3.10 Indemnification of Issuing Bank....................... 35
3.11 The Issuing Bank and the Banks........................ 35
ARTICLE IV REPRESENTATIONS AND WARRANTIES........................ 37
4.01 Corporate Status...................................... 37
4.02 Corporate Power and Authorization..................... 37
4.03 Execution and Binding Effect.......................... 37
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4.04 Governmental Approvals and Filings..................... 37
4.05 Absence of Conflicts................................... 38
4.06 Audited Financial Statements........................... 38
4.07 Interim Financial Statements........................... 38
4.08 [Intentionally Omitted]................................ 39
4.09 Absence of Undisclosed Liabilities..................... 39
4.10 Absence of Material Adverse Changes.................... 39
4.11 Accurate and Complete Disclosure....................... 39
4.12 [Intentionally Omitted]................................ 39
4.13 Projections............................................ 39
4.14 Solvency............................................... 40
4.15 Margin Regulations..................................... 40
4.16 Subsidiaries........................................... 40
4.17 Partnerships, etc...................................... 40
4.18 Ownership and Control by Paul S. Bush.................. 40
4.19 Litigation............................................. 40
4.20 Absence of Events of Default........................... 40
4.21 Absence of Other Conflicts............................. 41
4.22 Insurance.............................................. 41
4.23 Title to Property...................................... 41
4.24 Intellectual Property.................................. 41
4.25 Taxes.................................................. 41
4.26 Employee Benefits...................................... 42
4.27 Environmental Matters.................................. 42
4.28 Regulatory Restrictions................................ 43
ARTICLE V CONDITIONS OF CREDIT EXTENSIONS........................ 43
5.01 Conditions to Initial Credit Extension................. 43
5.02 Conditions to All Credit Extensions.................... 45
ARTICLE VI AFFIRMATIVE COVENANTS.................................. 46
6.01 Basic Reporting Requirements........................... 46
6.02 Insurance.............................................. 59
6.03 Payment of Taxes and Other Potential
Charges and Priority Claims.......................... 49
6.04 Preservation of Corporate Status....................... 49
6.05 Governmental Approvals and Filings..................... 49
6.06 Maintenance of Properties, Franchises, Etc............. 50
6.07 Avoidance of Other Conflicts........................... 50
6.08 Financial Accounting Practices......................... 50
6.09 Use of Proceeds........................................ 50
6.10 Continuation of or Change in Business.................. 51
6.11 Consolidated Tax Return................................ 51
6.12 Significant Subsidiary Guaranty........................ 51
6.13 Repayment of Certain Indebtedness...................... 51
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ARTICLE VII NEGATIVE COVENANTS..................................... 51
7.01 Financial Covenants.................................... 51
7.02 Liens.................................................. 52
7.03 Indebtedness........................................... 53
7.04 Guarantees, Indemnities, etc........................... 54
7.05 Loans, Advances and Investments........................ 54
7.06 Dividends and Related Distributions.................... 55
7.07 Sale-Leasebacks........................................ 56
7.08 Leases................................................. 56
7.09 Mergers, Acquisitions, etc............................. 56
7.10 Dispositions of Properties............................. 57
7.11 Issuance of Subsidiary Stock........................... 58
7.12 Dealings with Affiliates............................... 58
7.13 Capital Expenditures................................... 58
7.14 Limitations on Modification of Certain
Agreements and Instruments........................... 59
7.15 Limitation on Payments and Modification
of Restricted Indebtedness........................... 59
7.16 Limitation on Other Restrictions on
Dividends by Subsidiaries, etc....................... 59
7.17 Limitation on Other Restrictions on Liens.............. 60
7.18 Limitation on Other Restrictions on
Amendment of the Loan Documents, etc................. 60
ARTICLE VIII DEFAULTS............................................... 60
8.01 Events of Default...................................... 60
8.02 Consequences of an Event of Default.................... 63
ARTICLE IX THE AGENT.............................................. 63
9.01 Appointment............................................ 63
9.02 General Nature of Agent's Duties....................... 63
9.03 Exercise of Powers..................................... 64
9.04 General Exculpatory Provisions......................... 64
9.05 Administration by the Agent............................ 65
9.06 Lender Not Relying on Agent or Other Lenders........... 65
9.07 Indemnification of Agent by Lenders.................... 66
9.08 Agent in its Individual Capacity....................... 66
9.09 Holders of Notes....................................... 66
9.10 Successor Agent........................................ 66
9.11 Additional Agents...................................... 67
9.12 Calculations........................................... 67
9.13 Agent's Fee............................................ 67
9.14 Funding by Agent....................................... 67
ARTICLE X MISCELLANEOUS.......................................... 67
10.01 Holidays............................................... 67
10.02 Records................................................ 68
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10.03 Amendments and Waivers................................. 68
10.04 No Implied Waiver; Cumulative Remedies................. 69
10.05 Notices................................................ 69
10.06 Expenses; Taxes; Indemnity............................. 69
10.07 Severability........................................... 70
10.08 Prior Understandings................................... 70
10.09 Duration; Survival..................................... 70
10.10 Counterparts........................................... 71
10.11 Limitation on Payments................................. 71
10.12 Set-Off................................................ 71
10.13 Sharing of Collections................................. 71
10.14 Successors and Assigns; Participations;
Assignments.......................................... 72
10.15 Governing Law; Submission to Jurisdiction:
Waiver of Jury Trial; Limitation
of Liability....................................... 74
10.16 Confidentiality........................................ 75
10.17 Rights and Obligations of Mellon
Under Standby Bond Purchase Agreement................ 75
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Exhibit A Form of Revolving Credit Note
Exhibit B-1 Form of Standby Letter of Credit Application
Exhibit B-2 Form of Merchandise Letter of Credit Application
Exhibit B-3 Form of Letter of Credit Agreement
Exhibit C Form of Opinion of Counsel to the Borrower
Exhibit D Form of Quarterly Compliance Certificate
Exhibit E Form of Significant Subsidiary Guaranty
Exhibit F Form of Transfer Supplement
Exhibit G Form of Payoff Letter for Asset Based Lending Facility
Schedule 3.01(g) Prior Letters of Credit
Schedule 4.01 Corporate Status
Schedule 4.04 Governmental Approvals and Filings
Schedule 4.05 Absence of Conflicts
Schedule 4.09 Absence of Undisclosed Liabilities
Schedule 4.10 Material Adverse Changes
Schedule 4.16 Subsidiaries
Schedule 4.17 Partnerships, etc.
Schedule 4.18 Ownership and Control
Schedule 4.19 Litigation
Schedule 4.21 Absence of Other Conflicts
Schedule 4.22 Insurance
Schedule 4.25 Taxes
Schedule 4.26 Employee Benefits
Schedule 4.27 Environmental Matters
Schedule 6.13 Certain Indebtedness to be Repaid
Schedule 7.02 Permitted Liens
Schedule 7.03 Permitted Indebtedness
Schedule 7.04 Permitted Guaranties, Indemnities, etc.
Schedule 7.05 Permitted Loans, Advances and Investments
Schedule 7.12 Permitted Dealings with Affiliates
Schedule 7.18 Agreements Containing Restrictions on Amendment
of Loan Documents
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CREDIT AGREEMENT
THIS AGREEMENT, dated as of July 26, 1995, by and among BUSH
INDUSTRIES, INC., a Delaware corporation (the "Borrower"), the Lenders party
hereto from time to time, the Issuing Bank referred to herein and MELLON BANK,
N.A., a national banking association, as agent for the Lenders hereunder (in
such capacity, together with its successors in such capacity, the "Agent").
Recitals:
A. The Borrower has requested the Agent, the Lenders and the Issuing
Bank to enter into this Agreement and extend credit as provided herein and the
Agent, the Lenders and the Issuing Bank are willing to provide such credit on
the terms and subject to the conditions herein contained.
NOW, THEREFORE, in consideration of the premises and of the mutual
covenants herein contained and intending to be legally bound hereby, the parties
hereto agree as follows:
ARTICLE I
DEFINITIONS; CONSTRUCTION
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1.01. Certain Definitions. In addition to other words and terms
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defined elsewhere in this Agreement, as used herein the following words and
terms shall have the following meanings, respectively, unless the context hereof
otherwise clearly requires:
"Acquisitions" shall have the meaning set forth in Section 7.09(b)
hereof.
"Affected Lender" shall have the meaning set forth in Section 2.04(e)
hereof.
"Affiliate" of a Person (the "Specified Person") shall mean any Person
which directly or indirectly controls, or is controlled by, or is under
common control with, the specified Person.
"Applicable Margin" shall have the meaning set forth in Section
2.04(b) hereof.
"Asset Based Lending Facility" shall mean the Loan and Security
Agreement dated as of June 23, 1992 between the Borrower and Mellon Bank,
N.A., as amended, modified and supplemented from time to time, and all
notes, mortgages, security agreements and other documents, agreements and
instruments relating thereto or executed in connection therewith or as
security therefor or evidencing Indebtedness thereunder, but excluding the
IDA Facility.
"Associate," when used to indicate a relationship with any Person,
shall mean: (a) any corporation or organization of which such Person is an
officer, director or partner or is, directly or indirectly, the beneficial
owner of shares of voting common stock entitling that Person to cast votes
representing at least 10% of the voting power of all the voting common
stock of such corporation or organization; (b) any trust or other estate in
which such Person has a substantial beneficial interest or as to which such
Person serves as trustee or in a similar fiduciary capacity; (c) any
relative or spouse of such Person, or any relative of the spouse, who has
the same home as such Person; and (d) minor children of such Person or any
trust established by such Person for the benefit of his minor children.
"Base Rate" shall have the meaning set forth in Section 2.04(a)
hereof.
"Base Rate Option" shall have the meaning set forth in Section 2.04(a)
hereof.
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"Base Rate Portion" of any Loan or Loans shall mean at any time the
portion, including the whole, of such Loan or Loans bearing interest at
such time (i) under the Base Rate Option or (ii) in accordance with Section
2.10(c)(ii) hereof. If no Loan or Loans is specified, "Base Rate Portion"
shall refer to the Base Rate Portion of all Loans outstanding at such time.
"Business Day" shall mean any day other than a Saturday, Sunday,
public holiday under the laws of the Commonwealth of Pennsylvania or other
day on which banking institutions are authorized or obligated to close in
the city in which is located the Agent's Office.
"Capital Expenditures" of any Person shall mean, for any period, all
expenditures (whether paid in cash or accrued as liabilities during such
period) of such Person during such period which would be classified as
capital expenditures in accordance with GAAP (including, without
limitation, expenditures for maintenance and repairs which are capitalized,
and Capitalized Leases to the extent an asset is recorded in connection
therewith in accordance with GAAP).
"Capitalized Lease" shall mean at any time any lease which is, or is
required under GAAP to be, capitalized on the balance sheet of the lessee
at such time, and "Capitalized Lease Obligation" of any Person at any time
shall mean the aggregate amount which is, or is required under GAAP to be,
reported as a liability on the balance sheet of such Person at such time as
lessee under a Capitalized Lease.
"Cash Equivalent Investments" shall mean any of the following, to the
extent acquired for investment and not with a view to achieving trading
profits: (a) obligations fully backed by the full faith and credit of the
United States of America maturing not in excess of three months from the
date of acquisition, (b) commercial paper maturing not in excess of three
months from the date of acquisition and rated "P-1" by Moody's Investors
Service or "A-1" by Standard & Poor's Corporation on the date of
acquisition, and (c) the following obligations of any Affiliate of a Lender
or any domestic commercial bank having capital and surplus in excess of
$500,000,000, which has, or the holding company of which has, a commercial
paper rating meeting the requirements specified in clause (b) above: (i)
time deposits, certificates of deposit and acceptances maturing not in
excess of nine months from the date of acquisition, or (ii) repurchase
obligations with a term of not more than seven days for underlying
securities of the type referred to in clause (a) above.
"CERCLA" shall mean the Comprehensive Environmental Response,
Compensation and Liability Act, as amended, and any successor statute of
similar import, and regulations thereunder, in each case as in effect from
time to time.
"CERCLIS" shall mean the Comprehensive Environmental Response,
Compensation and Liability Information System List, as the same may be
amended from time to time.
"Change of Control" shall mean that at any time the Control Group
shall fail to satisfy the Control Tests for any reason (voluntarily or
involuntarily). As used herein, the term "Control Group" shall mean the
following Persons at any time prior to the death of Paul S. Bush: (a) Paul
S. Bush, (b) Affiliates of Paul S. Bush, (c) Associates of Paul S. Bush and
(d) adult children of Paul S. Bush. As used herein, the term "Control
Group" shall mean the following Persons at any time after the death of Paul
S. Bush: (e) the children of Paul S. Bush, (f) any spouse which Paul S.
Bush may have had prior to his death and (g) Affiliates and Associates of
the Persons named in clauses (e) and (f). As used herein, the "Control
Tests" are deemed satisfied at a given time if and only if at such time:
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(x) The members of the Control Group in the aggregate own
(beneficially and of record) and have the right to vote shares of
voting common stock of the Borrower representing 51% of the voting
power of all the voting common stock of the Borrower (assuming for
purposes of such calculation that all then-outstanding options,
warrants, conversion rights or other rights held by any Person which
may in any circumstances give such other Person the right to acquire
shares of voting common stock are exercised at such time by such other
Person (so that all shares of voting common stock potentially issuable
pursuant to such rights shall be deemed outstanding and held by such
Person for purposes of such calculation), regardless of whether such
rights are in fact then exercisable or whether any conditions to such
exercise are then met).
"Closing Date" shall mean the date of the first Credit Extension
hereunder.
"Code" means the Internal Revenue Code of 1986, as amended, and any
successor statute of similar import, and regulations thereunder, in each
case as in effect from time to time. References to sections of the Code
shall be construed also to refer to any successor sections.
"Commitments" of a Lender shall mean the Revolving Credit Commitment
of such Lender.
"Commitment Percentage" of a Lender at any time shall mean the
Commitment Percentage for such Lender set forth below its name on the
signature page hereof, subject to transfer to another Lender as provided in
Section 10.14 hereof.
"Consolidated Debt Service Charges" for any period, with respect to
the Borrower and its consolidated Subsidiaries, shall mean the sum of (a)
Consolidated Interest Expense for such period, and (b) scheduled principal
payments made during such period with respect to any outstanding
Indebtedness, all as determined on a consolidated basis in accordance with
GAAP.
"Consolidated EBIT" for any period, with respect to the Borrower and
its consolidated Subsidiaries, shall mean the sum of (a) Consolidated Net
Income for such period, (b) Consolidated Interest Expense for such period,
(c) Consolidated Income Tax Expense for such period, all as determined on a
consolidated basis in accordance with GAAP.
"Consolidated Funded Debt" of the Borrower and its Consolidated
Subsidiaries at any time shall mean Indebtedness (including the current
portion thereof) of the Borrower and its consolidated Subsidiaries which
would as of such date be classified in whole or in part as a long-term
liability in accordance with GAAP, and in any event includes (i) any
Indebtedness having a final maturity later than one year after the date of
incurrence of such Indebtedness and (ii) any Indebtedness which is
renewable or extendable pursuant to its terms by the obligor in its sole
discretion to a date later than one year after the date of incurrence of
such Indebtedness; provided, that Consolidated Funded Debt shall not
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include Indebtedness represented by any Letter of Credit issued hereunder
(other than, in the case of Standby Letters of Credit issued to provide
credit enhancement for the IDA Facility and Indebtedness permitted by
Section 7.03(g), the Indebtedness so enhanced).
"Consolidated Funded Debt (Net)" of the Borrower and its consolidated
Subsidiaries at any time shall mean Consolidated Funded Debt of the
Borrower and its consolidated Subsidiaries at such time minus all cash and
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Cash Equivalent Investments of the Borrower and its consolidated
Subsidiaries at such time.
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"Consolidated Income Tax Expense" for any period, with respect to the
Borrower and its consolidated Subsidiaries, shall mean the charges against
income for foreign, federal, state and local income taxes for such period,
determined on a consolidated basis in accordance with GAAP.
"Consolidated Interest Expense" for any period shall mean the total
interest expense of the Borrower and its consolidated Subsidiaries for such
period determined on a consolidated basis in accordance with GAAP.
"Consolidated Lease Expense" for any Fiscal Year with respect to some
or all leases shall mean the aggregate rental expense with respect to such
leases or all leases, as the case may be, of the Borrower and its
consolidated Subsidiaries determined on a consolidated basis in respect of
such Fiscal Year in accordance with GAAP, but in any case including taxes,
insurance, maintenance and similar expenses which the lessee is obligated
to pay under the terms of such leases and which are properly expensed
during such Fiscal Year in accordance with GAAP.
"Consolidated Net Income" for any period shall mean the net earnings
(or loss) after taxes of the Borrower and its consolidated Subsidiaries for
such period determined on a consolidated basis in accordance with GAAP, but
not including any extraordinary items determined in accordance with GAAP;
provided, that there shall be deducted therefrom (a) the income (or
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deficit) of any Person accrued prior to the date it becomes a consolidated
Subsidiary or is merged into or consolidated with or is otherwise acquired
by or combined with the Borrower or any consolidated Subsidiary in a
business combination accounted for as a pooling of interests, including, in
the case of a successor to the Borrower or any consolidated Subsidiary by
consolidation or merger or transfer of assets, any earnings of the
successor corporation prior to such consolidation, merger or transfer of
assets, (b) income or loss accounted for by the Borrower on the equity
method because of the income (or deficit) during such period of any Person
(other than a consolidated Subsidiary) in which the Borrower or any
consolidated Subsidiary has an ownership interest, but the deduction for
such equity income shall be reversed to the extent that during such period
or at any subsequent time an amount not in excess of such income has been
actually received by the Borrower or such consolidated Subsidiary in the
form of cash or property dividends or similar distributions, (c) income or
loss of a non-domestic Subsidiary, but the deduction for such Subsidiary
income shall be reversed to the extent that during such period or at any
subsequent time an amount not in excess of such income has been actually
received by the Borrower or such consolidated Subsidiary in the form of
cash or property dividends or similar distributions, not subject to foreign
currency translation, (d) the undistributed earnings of any consolidated
Subsidiary to the extent that the declaration or payment of dividends or
similar distributions by such consolidated Subsidiary is restricted
(whether such restriction arises by operation of Law, by agreement, by its
articles of incorporation or by-laws (or other constituent documents), or
otherwise), and (e) any gain arising from the acquisition of any
securities, or the extinguishment, under GAAP, of any Indebtedness, of the
Borrower or any consolidated Subsidiary.
"Consolidated Net Worth" at any time shall mean the total amount of
stockholders' equity of the Borrower and its consolidated Subsidiaries at
such time determined on a consolidated basis in accordance with GAAP.
"Consolidated Tangible Net Worth" at any time shall mean the total
amount of stockholders' equity of the Borrower and its consolidated
Subsidiaries at such time determined on a consolidated basis in accordance
with GAAP, except that there shall be deducted therefrom the book value of
(x) all intangible assets of the Borrower and its consolidated Subsidiaries
at such time and (y) all Indebtedness of any Affiliate, officer or director
of the Borrower or of any
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of its consolidated Subsidiaries owed to the Borrower or such Subsidiary
with respect to loans or advances by the Borrower or such Subsidiary to
such Affiliate, officer or director at such time, all as determined on a
consolidated basis in accordance with GAAP.
"Control," "controlled" and "controlling," when used with respect to a
Person (the "specified Person"), means the possession, directly or
indirectly, of the power to direct or cause the direction of the management
or policies of the specified Person, whether through the ownership of
voting securities, by contract or otherwise. A Person's beneficial
ownership of shares of voting common stock entitling that Person to cast
votes representing at least 10% of the voting power of all the voting
common stock of any corporation shall create a presumption that such Person
has control of such corporation.
"Controlled Group Member" shall mean each trade or business (whether
or not incorporated) which together with the Borrower or any Subsidiary of
the Borrower is treated as a single employer under Sections 4001(a)(14) or
4001(b)(1) of ERISA or Sections 414(b), (c), (m) or (o) of the Code.
"Corresponding Source of Funds" shall mean, in the case of any Funding
Segment of the Euro-Rate Portion, the proceeds of hypothetical receipts by
a Notional Euro-Rate Funding Office or by a Lender through a Notional Euro-
Rate Funding Office of one or more Dollar deposits in the interbank
eurodollar market at the beginning of the Euro-Rate Funding Period
corresponding to such Funding Segment having maturities approximately equal
to such Euro-Rate Funding Period and in an aggregate amount approximately
equal to such Lender's Pro Rata share of such Funding Segment.
"Credit Extension" shall mean: (a) the making of any Loan by any
Lender or (b) the issuance, or extension of the expiration date of, any
Letter of Credit by the Issuing Bank.
"Designated Stock Purchases" shall mean any purchase, redemption,
retirement or acquisition by the Borrower of its capital stock pursuant to
Section 7.06(d) hereof from time to time in the aggregate amount of up to
$8,000,000 on a cumulative basis.
"Dollar," "Dollars" and the symbol "$" shall mean lawful money of the
United States of America.
"Environmental Affiliate" shall mean, with respect to any Person, any
other Person whose liability (contingent or otherwise) for any
Environmental Claim such Person has retained, assumed or otherwise is
liable for (by Law, agreement or otherwise).
"Environmental Approvals" shall mean any Governmental Action pursuant
to or required under any Environmental Law.
"Environmental Claim" shall mean, with respect to any Person, any
action, suit, proceeding, investigation, notice, claim, complaint, demand,
request for information or other communication (written or oral) by any
other Person (including but not limited to any Governmental Authority,
citizens' group or present or former employee of such Person) alleging,
asserting or claiming any actual or potential (a) violation of any
Environmental Law, (b) liability under any Environmental Law or (c)
liability for investigatory costs, cleanup costs, governmental response
costs, natural resources damages, property damages, personal injuries,
fines or penalties arising out of, based on or resulting from the presence,
or release into the environment, of any Environmental Concern Materials at
any location, whether or not owned by such Person.
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"Environmental Cleanup Site" shall mean any location which is listed
or proposed for listing on the National Priorities List, on CERCLIS or on
any similar state list of sites requiring investigation or cleanup, or
which is the subject of any pending or threatened action, suit, proceeding
or investigation related to or arising from any alleged violation of any
Environmental Law.
"Environmental Concern Materials" shall mean (a) any flammable
substance, explosive, radioactive material, hazardous material, hazardous
waste, toxic substance, solid waste, pollutant, contaminant or any related
material, raw material, substance, product or by-product of any substance
specified in or regulated or otherwise affected by any Environmental Law
(including but not limited to any "hazardous substance" as defined in
CERCLA or any similar state Law), (b) any toxic chemical or other substance
from or related to industrial, commercial or institutional activities, and
(c) asbestos, gasoline, diesel fuel, motor oil, waste and used oil, heating
oil and other petroleum products or compounds, polychlorinated biphenyls,
radon and urea formaldehyde.
"Environmental Law" shall mean any Law, whether now existing or
subsequently enacted or amended, relating to (a) pollution or protection of
the environment, including natural resources, (b) exposure of Persons,
including but not limited to employees, to Environmental Concern Materials,
(c) protection of the public health or welfare from the effects of
products, by-products, wastes, emissions, discharges or releases of
Environmental Concern Materials or (d) regulation of the manufacture, use
or introduction into commerce of Environmental Concern Materials including
their manufacture, formulation, packaging, labeling, distribution,
transportation, handling, storage or disposal. Without limitation,
"Environmental Law" shall also include any Environmental Approval and the
terms and conditions thereof.
"ERISA" shall mean the Employee Retirement Income Security Act of
1974, as amended, and any successor statute of similar import, and
regulations thereunder, in each case as in effect from time to time.
References to sections of ERISA shall be construed also to refer to any
successor sections.
"Euro-Rate" shall have the meaning set forth in Section 2.04(a)
hereof.
"Euro-Rate Funding Period" shall have the meaning set forth in Section
2.04(c) hereof.
"Euro-Rate Option" shall have the meaning set forth in Section 2.04(a)
hereof.
"Euro-Rate Portion" of any Loan or Loans shall mean at any time the
portion, including the whole, of such Loan or Loans bearing interest at any
time under the Euro-Rate Option or at a rate calculated by reference to the
Euro-Rate under Section 2.10(c)(i) hereof. If no Loan or Loans is
specified, "Euro-Rate Portion" shall refer to the Euro-Rate Portion of all
Loans outstanding at such time.
"Euro-Rate Reserve Percentage" shall have the meaning set forth in
Section 2.04(a) hereof.
"Event of Default" shall mean any of the Events of Default described
in Section 8.01 hereof.
"Federal Funds Effective Rate" for any day shall mean the rate per
annum (rounded upward to the nearest 1/100 of 1%) determined by the Agent
(which determination shall be conclusive) to be the rate per annum
announced by the Federal Reserve Bank of New York (or any successor) on
such day as being the weighted average of the rates on overnight Federal
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funds transactions arranged by Federal funds brokers on the previous
trading day, as computed and announced by such Federal Reserve Bank (or any
successor) in substantially the same manner as such Federal Reserve Bank
computes and announces the weighted average it refers to as the "Federal
Funds Effective Rate" as of the date of this Agreement; provided, that if
--------
such Federal Reserve Bank (or its successor) does not announce such rate on
any day, the "Federal Funds Effective Rate" for such day shall be the
Federal Funds Effective Rate for the last day on which such rate was
announced.
"Financial Test A" shall have the meaning set forth in Section 2.04(b)
hereof.
"Financial Test B" shall have the meaning set forth in Section 2.04(b)
hereof.
"Financial Test C" shall have the meaning set forth in Section 2.04(b)
hereof.
"Fiscal Year" shall mean the fiscal year of the Borrower.
"Funding Periods" shall have the meaning set forth in Section 2.04(c)
hereof.
"Funding Breakage Date" shall have the meaning set forth in Section
2.11(b) hereof.
"Funding Breakage Indemnity" shall have the meaning set forth in
Section 2.11(b) hereof.
"Funding Segment" of the Euro-Rate Portion of the Revolving Credit
Loans at any time shall mean the entire principal amount of such Portion to
which at the time in question there is applicable a particular Funding
Period beginning on a particular day and ending on a particular day. (By
definition, each such Portion is at all times composed of an integral
number of discrete Funding Segments and the sum of the principal amounts of
all Funding Segments of any such Portion at any time equals the principal
amount of such Portion at such time.)
"GAAP" shall have the meaning set forth in Section 1.03 hereof.
"Governmental Action" shall have the meaning set forth in Section 4.04
hereof.
"Governmental Authority" shall mean any government or political
subdivision or any agency, authority, bureau, central bank, commission,
department or instrumentality of either, or any court, tribunal, grand jury
or arbitrator, in each case whether foreign or domestic.
"Guarantor" shall mean any Significant Subsidiary of the Borrower.
"Guaranty Equivalent": A Person (the "Deemed Guarantor") shall be
deemed to subject to a Guaranty Equivalent in respect of any indebtedness,
obligation or liability (the "Assured Obligation") of another Person (the
"Deemed Obligor") if the Deemed Guarantor directly or indirectly
guarantees, becomes surety for, endorses, assumes, agrees to indemnify the
Deemed Obligor against, or otherwise agrees, becomes or remains liable
(contingently or otherwise) for, such Assured Obligation. Without
limitation, a Guaranty Equivalent shall be deemed to exist if a Deemed
Guarantor agrees, becomes or remains liable (contingently or otherwise),
directly or indirectly: (a) to purchase or assume, or to supply funds for
the payment, purchase or satisfaction of, an Assured Obligation, (b) to
make any loan, advance, capital contribution or other investment in, or to
purchase or lease any property or services from, a Deemed Obligor (i) to
maintain the solvency of the Deemed Obligor, (ii) to enable the Deemed
Obligor to meet any other financial condition, (iii) to enable the Deemed
Obligor to satisfy any Assured Obligation or to make any Stock Payment or
any other payment, or (iv) to assure the holder of such Assured
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Obligation against loss, (c) to purchase or lease property or services from
the Deemed Obligor regardless of the non-delivery of or failure to furnish
of such property or services, (d) in a transaction having the
characteristics of a take-or-pay or throughput contract or as described in
paragraph 6 of FASB Statement of Financial Accounting Standards No. 47, or
(e) in respect of any other transaction the effect of which is to assure
the payment or performance (or payment of damages or other remedy in the
event of nonpayment or nonperformance) of any Assured Obligation.
"IDA Facility" shall mean the Industrial Development Revenue Bonds
(1984 Bush Industries, Inc. Project) ("Bonds") in the aggregate original
principal amount of $6,400,000 issued by the County of Chautauqua
Industrial Development Agency ("CCIDA") pursuant to an Indenture of Trust
dated as of December 1, 1984, as amended or supplemented from time to time,
by and between CCIDA and the Trustee named therein, together with all
letters of credit, reimbursement agreements, notes, mortgages, security
agreements, standby bond purchase agreements and other documents,
agreements and instruments relating thereto or executed in connection
therewith or as security therefor or evidencing Indebtedness thereunder.
"Indebtedness" of a Person shall mean:
(a) All obligations on account of money borrowed by, or credit
extended to or on behalf of, or for or on account of deposits with or
advances to, such Person;
(b) All obligations of such Person evidenced by bonds,
debentures, notes or similar instruments;
(c) All obligations of such Person for the deferred purchase
price of property or services;
(d) All obligations secured by a Lien on property owned by such
Person (whether or not assumed); and all obligations of such Person
under Capitalized Leases (without regard to any limitation of the
rights and remedies of the holder of such Lien or the lessor under
such Capitalized Lease to repossession or sale of such property), it
being understood that obligations of such Person under operating
leases shall not be considered Indebtedness for purposes hereof;
(e) The face amount of all letters of credit issued for the
account of such Person and, without duplication, the unreimbursed
amount of all drafts drawn thereunder, and all other obligations of
such Person associated with such letters of credit or draws thereon,
but excluding the face amount of any letters of credit which support
the obligations of such Person with respect to other Indebtedness of
such Person, to the extent such other Indebtedness is reflected in any
determination of the Indebtedness of such Person;
(f) All obligations of such Person in respect of acceptances or
similar obligations issued for the account of such Person;
(g) All obligations of such Person under a product financing or
similar arrangement described in paragraph 8 of FASB Statement of
Accounting Standards No. 49 or any similar requirement of GAAP; and
(h) All obligations of such Person under any interest rate or
currency protection agreement, interest rate or currency future,
interest rate or currency option, interest rate or currency swap or
cap or other interest rate or currency hedge agreement.
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"Indemnified Parties" shall mean the Agent, the Lenders, their
respective Affiliates, and the directors, officer, employees, attorneys and
agents of each of the foregoing.
"Information" shall have the meaning set forth in Section 10.16
hereof.
"Initial Revolving Credit Committed Amount" shall have the meaning set
forth in Section 2.01(a) hereof.
"Issuing Bank" shall mean Mellon Bank, N.A. and such Affiliates of
Mellon Bank, N.A. as Mellon Bank, N.A. may in its discretion from time to
time elect to cause to issue Letters of Credit.
"Law" shall mean any law (including common law), constitution,
statute, treaty, convention, regulation, rule, ordinance, order,
injunction, writ, decree or award of any Governmental Authority.
"LC Collateral Account" shall have the meaning set forth in Section
3.09(b)(i) hereof.
"LC Indemnified Parties" shall have the meaning set forth in Section
3.10 hereof.
"Lender" shall mean any of the Lenders listed on the signature pages
hereof, subject to the provisions of Section 10.14 hereof pertaining to
Persons becoming or ceasing to be Lenders. "Lender" shall in any event
include the Issuing Bank.
"Letters of Credit" shall have the meaning set forth in Section
3.01(a) hereof.
"Letter of Credit Agreement" shall have the meaning set forth in
Section 5.01(a) hereof.
"Letter of Credit Applications" shall have the meaning set forth in
Section 3.02(a)(ii) hereof.
"Letter of Credit Exposure" at any time shall mean the sum at such
time of (a) the aggregate amount of all Unreimbursed Draws under Letters of
Credit (whether or not the Letter of Credit under which any such
Unreimbursed Draw arose is then outstanding) and (b) the aggregate Undrawn
Availability under all outstanding Letters of Credit.
"Letter of Credit Facing Fee" shall have the meaning set forth in
Section 3.01(f) hereof.
"Letter of Credit Fees" shall mean, collectively, Standby Letter of
Credit Fees and Merchandise Letter of Credit Fees.
"Letter of Credit Participating Interest" shall have the meaning set
forth in Section 3.03(a) hereof.
"Lien" shall mean any mortgage, deed of trust, pledge, lien, security
interest, charge or other encumbrance or security arrangement of any nature
whatsoever, including but not limited to any conditional sale or title
retention arrangement, and any assignment, deposit arrangement or lease
intended as, or having the effect of, security.
"Loan" shall mean any loan by a Lender to the Borrower under this
Agreement, and "Loans" shall mean all Loans made by the Lenders under this
Agreement.
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"Loan Documents" shall mean this Agreement, the Notes, the Transfer
Supplements, the Letters of Credit, the Letter of Credit Agreement, the
Letter of Credit Applications, any Guarantees and all other agreements,
instruments and certificates executed and delivered in connection with any
of the foregoing, together with all agreements and instruments extending,
renewing, refinancing or refunding any indebtedness, obligation or
liability arising under any of the foregoing, in each case as the same may
be amended, modified or supplemented from time to time hereafter.
"Loan Party" shall mean the Borrower and any Guarantor.
"London Business Day" shall mean a day for dealing in deposits in
Dollars by and among banks in the London interbank market and which is a
Business Day.
"Material Adverse Effect" shall mean: (a) a material adverse effect on
the business, operations, condition (financial or otherwise) or prospects
of the Borrower and its Subsidiaries taken as a whole, (b) a material
adverse effect on the ability of any Loan Party to perform or comply with
any of the terms and conditions of any Loan Document, or (c) a material
adverse effect on the legality, validity, binding effect or enforceability
of any Loan Document, or the ability of the Agent or any Lender to enforce
any rights or remedies under or in connection with any Loan Document.
"Mellon" shall mean Mellon Bank, N.A., a national banking association.
"Merchandise Letter of Credit" shall have the meaning set forth in
Section 3.01(a) hereof.
"Merchandise Letter of Credit Application" shall have the meaning set
forth in Section 3.02(a)(ii) hereof.
"Merchandise Letter of Credit Fee" shall have the meaning set forth in
Section 3.01(e) hereof.
"Multiemployer Plan" shall mean any employee benefit plan which is a
"multiemployer plan" within the meaning of Section 4001(a)(3) of ERISA and
to which the Borrower or any Controlled Group Member has or had an
obligation to contribute.
"Net Cash Proceeds" with respect to any property shall mean cash or
cash equivalents received by the Borrower or any of its Subsidiaries from,
and payments of principal of any Capitalized Lease Obligations or other
obligation received by the Borrower or such Subsidiary in connection with,
the sale, lease or other disposition of such property, minus the sum of (a)
-----
expenses reasonably incurred in respect of such sale, lease or other
disposition, (b) any sales or transfer taxes payable as a result of such
sale, lease or other disposition, (c) incremental income taxes reasonably
estimated by the Borrower to be payable by the Borrower or such Subsidiary
as a result of such sale, lease or other disposition and (d) the amount
required to discharge any Indebtedness secured by a Lien on such property
and required to be discharged in connection with such sale, lease or other
disposition; provided, that for purposes hereof Net Cash Proceeds shall be
--------
rounded to the nearest $1,000 and integral multiples thereof.
"Note" or "Notes" shall mean the Revolving Credit Note(s) of the
Borrower executed and delivered under this Agreement, together with all
extensions, renewals, refinancings or refundings of any thereof in whole or
part.
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"Notional Euro-Rate Funding Office" shall have the meaning given to
that term in Section 2.13(a) hereof.
"Obligations" shall mean all indebtedness, obligations and liabilities
of the Borrower to any Lender or the Agent from time to time arising under
or in connection with or related to or evidenced by or secured by or under
color of this Agreement or any other Loan Document, and all extensions,
renewals or refinancings thereof, whether such indebtedness, obligations or
liabilities are direct or indirect, otherwise secured or unsecured, joint
or several, absolute or contingent, due or to become due, whether for
payment or performance, now existing or hereafter arising. Without
limitation of the foregoing, such indebtedness, obligations and liabilities
include the principal amount of Loans, interest, fees, indemnities or
expenses under or in connection with this Agreement or any other Loan
Document, and all extensions, renewals and refinancings thereof, whether or
not such Loans were made in compliance with the terms and conditions of
this Agreement or in excess of the obligation of the Lenders to lend.
Obligations shall remain Obligations notwithstanding any assignment or
transfer or any subsequent assignment or transfer of any of the Obligations
or any interest therein.
"Office," when used in connection with the Agent, shall mean its
office located at One Mellon Bank Center, Pittsburgh, Pennsylvania 15258,
or at such other office or offices of the Agent or any branch, subsidiary
or affiliate thereof as may be designated in writing from time to time by
the Agent to the Borrower.
"Option" shall mean the Base Rate Option or the Euro-Rate Option, as
the case may be.
"Participant" shall have the meaning set forth in Section 10.14(b)
hereof.
"PBGC" means the Pension Benefit Guaranty Corporation established
under Title IV of ERISA or any other governmental agency, department or
instrumentality succeeding to the functions of said corporation.
"Pension-Related Event" shall mean any of the following events or
conditions:
(a) Any action is taken by any Person (i) to terminate, or which
would result in the termination of, a Plan, either pursuant to its
terms or by operation of law (including, without limitation, any
amendment of a Plan which would result in a termination under Section
4041(e) of ERISA), or (ii) to have a trustee appointed for a Plan
pursuant to Section 4042 of ERISA;
(b) PBGC notifies any Person of its determination that an event
described in Section 4042 of ERISA has occurred with respect to a
Plan, that a Plan should be terminated, or that a trustee should be
appointed for a Plan;
(c) Any Reportable Event occurs with respect to a Plan;
(d) Any action occurs or is taken which could result in the
Borrower or any Subsidiary of the Borrower becoming subject to
liability for a complete or partial withdrawal by any Person from a
Multiemployer Plan (including, without limitation, seller liability
incurred under Section 4204(a)(2) of ERISA), or the Borrower, any
Subsidiary of the Borrower or any Controlled Group Member receives
from any Person a notice or demand for payment on account of any such
alleged or asserted liability; or
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(e) (i) There occurs any failure to meet the minimum funding
standard under Section 302 of ERISA or Section 412 of the Code with
respect to a Plan, or any tax return is filed showing any tax payable
under Section 4971(a) of the Code with respect to any such failure, or
the Borrower, any Subsidiary of the Borrower or any Controlled Group
Member receives a notice of deficiency from the Internal Revenue
Service with respect to any alleged or asserted such failure, or (ii)
any request is made by any Person for a variance from the minimum
funding standard, or an extension of the period for amortizing
unfunded liabilities, with respect to a Plan.
"Permitted Liens" shall have the meaning set forth in Section 7.02
hereof.
"Person" shall mean an individual, corporation, partnership, trust,
unincorporated association, joint venture, joint-stock company,
Governmental Authority or any other entity.
"Plan" means any employee pension benefit plan within the meaning of
Section 3(2) of ERISA (other than a Multiemployer Plan) covered by Title IV
of ERISA by reason of Section 4021 of ERISA, of which the Borrower or any
Subsidiary of the Borrower or any Controlled Group Member is or has been
within the preceding five years a "contributing sponsor" within the meaning
of Section 4001(a)(13) of ERISA, or which is or has been within the
preceding five years maintained for employees of the Borrower or any
Subsidiary of the Borrower or any Controlled Group Member.
"Portion" shall mean the Base Rate Portion or the Euro-Rate Portion,
as the case may be.
"Postretirement Benefits" shall mean any benefits, other than
retirement income, provided by the Borrower or any Loan Party to retired
employees, or to their spouses, dependents or beneficiaries, including,
without limitation, group medical insurance or benefits, or group life
insurance or death benefits.
"Postretirement Benefit Obligation" shall mean that portion of the
actuarial present value of all Postretirement Benefits expected to be
provided by the Borrower or any Subsidiary of the Borrower which is
attributable to employees' service rendered to the date of determination
(assuming that such liability accrues ratably over an employee's working
life to the earlier of his date of retirement or the date on which the
employee would first become eligible for full benefits), reduced by the
fair market value as of the date of determination of any assets which are
segregated from the assets of the Borrower or such Subsidiary and which
have been restricted so that they cannot be used for any purpose other than
to provide Postretirement Benefits or to defray related expenses.
"Potential Default" shall mean any event or condition which with
notice, passage of time or a determination by the Lender, or any
combination of the foregoing, would constitute an Event of Default.
"Prime Rate" as used herein, shall mean the interest rate per annum
announced from time to time by Mellon Bank, N.A. as its prime rate.
"Prior Letters of Credit" shall have the meaning set forth in Section
3.01(g) hereof.
"Pro Forma Activities" shall have the meaning set forth in Section
4.13 hereof.
"Pro Rata" shall mean from or to each Lender in proportion to its
Commitment Percentage.
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"Purchasing Lender" shall have the meaning set forth in Section
10.14(c) hereof.
"Register" shall have the meaning set forth in Section 10.14(d)
hereof.
"Regular Payment Date" shall mean the last day of each March, June,
September and December after the date hereof.
"Reimbursement Obligation" with respect to a Letter of Credit means
the obligation of the Borrower to reimburse the Issuing Bank for
Unreimbursed Draws, together with interest thereon.
"Reportable Event" means (i) a reportable event described in Section
4043 of ERISA and regulations thereunder, (ii) a withdrawal by a
substantial employer from a Plan to which more than one employer
contributes, as referred to in Section 4063(b) of ERISA, (iii) a cessation
of operations at a facility causing more than twenty percent (20%) of Plan
participants to be separated from employment, as referred to in Section
4062(e) of ERISA, or (iv) a failure to make a required installment or other
payment with respect to a Plan when due in accordance with Section 412 of
the Code or Section 302 of ERISA which causes the total unpaid balance of
missed installments and payments (including unpaid interest) to exceed
$500,000.
"Required Lenders" shall mean, as of any date, Lenders which have made
Loans constituting, in the aggregate, at least 66-2/3% in principal amount
of Loans outstanding on such date or, if no Loans are outstanding on such
date, Lenders which have Commitments constituting, in the aggregate, at
least 66-2/3% of the total Commitments of all the Lenders.
"Responsible Officer" shall mean the President, Executive Vice
President, Vice President of Corporate Development, Treasurer, Chief
Financial Officer and Secretary of the Borrower.
"Restricted Indebtedness" shall mean at any time any Indebtedness for
borrowed money of the Borrower which is approved in writing by, and which
has subordination provisions, terms of payment, interest rates and other
terms and conditions satisfactory to, the Lenders.
"Revolving Credit Commitment" shall have the meaning set forth in
Section 2.01(a) hereof.
"Revolving Credit Commitment Fee" shall have the meaning set forth in
Section 2.02 hereof.
"Revolving Credit Committed Amount" shall have the meaning set forth
in Section 2.01(a) hereof.
"Revolving Credit Exposure" of any Lender at any time shall mean the
sum at such time of the outstanding principal amount of such Lender's
Revolving Credit Loans plus such Lender's Pro Rata share of the sum of the
aggregate Letter of Credit Exposure.
"Revolving Credit Loans" shall have the meaning set forth in Section
2.01(a) hereof.
"Revolving Credit Maturity Date" shall mean July 31, 2000.
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"Revolving Credit Note" shall mean the promissory note of the Borrower
executed and delivered under Section 2.01(c) hereof, any promissory note
issued in substitution therefor pursuant to Sections 2.11(b) or 10.14(c)
hereof, together with all extensions, renewals, refinancings or refundings
thereof in whole or part.
"Significant Subsidiary" shall mean each Subsidiary of the Borrower
which in the most recent Fiscal Year of the Borrower accounted for more
than 10% of the consolidated assets of the Borrower and its Subsidiaries or
which accounted for more than 10% of the consolidated income of the
Borrower and its Subsidiaries for each of the most recent three Fiscal
Years of the Borrower; provided, however, that with respect to Subsidiaries
-------- -------
created or acquired after the date hereof, if thereafter such entity, in a
Fiscal Year, accounts for more than 10% of the consolidated assets of the
Borrower and its Subsidiaries in such Fiscal Year or accounts for more than
(x) 10% of the consolidated income of the Borrower and its Subsidiaries in
the year of creation or acquisition, (y) 10% of the consolidated income of
the Borrower and its Subsidiaries for each of the two most recent Fiscal
Years in the two years following creation or acquisition and (z)
thereafter, 10% of the consolidated income of the Borrower and its
Subsidiaries for each of the most recent three Fiscal Years, it shall be
deemed to be a Significant Subsidiary for such Fiscal Year.
"Significant Subsidiary Guaranty" shall mean the Significant
Subsidiary Guaranty in the form of Exhibit E hereto.
"Solvent" means, with respect to any Person at any time, that at such
time (a) the sum of the debts and liabilities (including, without
limitation, contingent liabilities) of such Person is not greater than all
of the assets of such Person at a fair valuation, (b) the present fair
salable value of the assets of such Person is not less than the amount that
will be required to pay the probable liability of such Person on its debts
as they become absolute and matured, (c) such Person has not incurred, will
not incur, does not intend to incur, and does not believe that it will
incur, debts or liabilities (including, without limitation, contingent
liabilities) beyond such Person's ability to pay as such debts and
liabilities mature, (d) such Person is not engaged in, and is not about to
engage in, a business or a transaction for which such Person's property
constitutes or would constitute unreasonably small capital, and (e) such
Person is not otherwise insolvent as defined in, or otherwise in a
condition which could in any circumstances then or subsequently render any
transfer, conveyance, obligation or act then made, incurred or performed by
it avoidable or fraudulent pursuant to, any Law that may be applicable to
such Person pertaining to bankruptcy, insolvency or creditors' rights
(including but not limited to the Bankruptcy Code of 1978, as amended, and,
to the extent applicable to such Person, the Uniform Fraudulent Conveyance
Act, the Uniform Fraudulent Transfer Act, or any other applicable Law
pertaining to fraudulent conveyances or fraudulent transfers or
preferences).
"Standard Notice" shall mean an irrevocable notice (which may be by
telephone confirmed in writing) provided to the Agent on a Business Day
which is
(a) The same Business Day in the case of selection of,
conversion to or renewal of the Base Rate Option or prepayment of any
Base Rate Portion; and
(b) At least two London Business Days in advance in the case of
selection of the Euro-Rate Option or prepayment of any Euro-Rate
Portion.
Standard Notice must be provided no later than 10:30 a.m., Pittsburgh time,
on the last day permitted for such notice.
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"Standby Bond Purchase Agreement" shall mean the Standby Bond Purchase
Agreement dated June 23, 1992 between the Borrower and Mellon, as amended
as of the date of this Agreement, as the same may be further amended,
modified, supplemented or extended from time to time.
"Standby Letter of Credit" shall have the meaning set forth in Section
3.01(a) hereof.
"Standby Letter of Credit Application" shall have the meaning set
forth in Section 3.02(b)(ii) hereof.
"Standby Letter of Credit Fee" shall have the meaning set forth in
Section 3.01(d) hereof.
"Stated Amount" of a Letter of Credit shall mean the face amount
thereof, drawn or undrawn, regardless of the existence or satisfaction of
any conditions or limitations on drawing.
"Stock Payment" by any Person shall mean any dividend, distribution or
payment of any nature (whether in cash, securities, or other property) on
account of or in respect of any shares of the capital stock (or warrants,
options or rights therefor) of such Person, including but not limited to
any payment on account of the purchase, redemption, retirement, defeasance
or acquisition of any shares of the capital stock (or warrants, options or
rights therefor) of such Person, in each case regardless of whether
required by the terms of such capital stock (or warrants, options or
rights) or any other agreement or instrument.
"Subsidiary" of a Person at any time shall mean any corporation of
which a majority (by number of shares or number of votes) of any class of
outstanding capital stock normally entitled to vote for the election of one
or more directors (regardless of any contingency which does or may suspend
or dilute the voting rights of such class) is at such time owned directly
or indirectly, beneficially or of record, by such Person or one or more
Subsidiaries of such Person, and any trust of which a majority of the
beneficial interest is at such time owned directly or indirectly,
beneficially or of record, by such Person or one or more Subsidiaries of
such Person.
"Taxes" shall have the meaning set forth in Section 2.12 hereof.
"Transfer Effective Date" shall have the meaning set forth in the
applicable Transfer Supplement.
"Transfer Supplement" shall have the meaning set forth in Section
10.14(c) hereof.
"Treasury Rate" as of any Funding Breakage Date shall mean the rate
per annum determined by the applicable Lender (which determination shall be
conclusive) to be the semiannual equivalent yield to maturity (expressed as
a semiannual equivalent and decimal and, in the case of United States
Treasury bills, converted to a bond equivalent yield) for United States
Treasury securities maturing on the last day of the corresponding Funding
Period and trading in the secondary market in reasonable volume (or if no
such securities mature on such date, the rate determined by standard
securities interpolation methods as applied to the series of securities
maturing as close as possible to, but earlier than, such date, and the
series of such securities maturing as close as possible to, but later than,
such date).
"Undrawn Availability" with respect to a Letter of Credit at any time
shall mean the maximum amount available to be drawn under such Letter of
Credit at such time, regardless of the existence or satisfaction of any
conditions or limitations on drawing.
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"Unreimbursed Draws" with respect to a Letter of Credit at such time
shall mean the aggregate amount at such time of all payments made by the
Issuing Bank under such Letter of Credit, to the extent not repaid by the
Borrower on the date when due.
1.02. Construction. Unless the context of this Agreement otherwise
------------
clearly requires, references to the plural include the singular, the singular
the plural and the part the whole; "or" has the inclusive meaning represented by
the phrase "and/or"; and "property" includes all properties and assets of any
kind or nature, tangible or intangible, real, personal or mixed. References in
this Agreement to "determination" (and similar terms) by the Agent or by any
Lender include good faith estimates by the Agent or by any Lender (in the case
of quantitative determinations) and good faith beliefs by the Agent or by any
Lender (in the case of qualitative determinations). The words "hereof,"
"herein," "hereunder" and similar terms in this Agreement refer to this
Agreement as a whole and not to any particular provision of this Agreement.
References herein to "out-of-pocket expenses" of a Person (and similar terms)
include, but are not limited to, the fees of in-house counsel and other in-house
professionals of such Person to the extent that such fees are routinely
identified and specifically charged under such Person's normal cost accounting
system. The section and other headings contained in this Agreement and the
Table of Contents preceding this Agreement are for reference purposes only and
shall not control or affect the construction of this Agreement or the
interpretation thereof in any respect. Section, subsection and exhibit
references are to this Agreement unless otherwise specified.
1.03. Accounting Principles.
---------------------
(a) As used herein, "GAAP" shall mean generally accepted accounting
principles in the United States, applied on a basis consistent with the
principles used in preparing the Borrower's financial statements as of April 1,
1995 and for the fiscal quarter then ended, as referred to in Section 4.06
hereof.
(b) Except for the projections referred to in Section 4.13 hereof and
as otherwise provided in this Agreement, all computations and determinations as
to accounting or financial matters shall be made, and all financial statements
to be delivered pursuant to this Agreement shall be prepared, in accordance with
GAAP (including principles of consolidation where appropriate), and all
accounting or financial terms shall have the meanings ascribed to such terms by
GAAP.
(c) If and to the extent that the financial statements generally
prepared by the Borrower apply accounting principles other than GAAP, all
financial statements referred to in this Agreement or any other Loan Document
shall be delivered in duplicate, one set based on the accounting principles then
generally applied by the Borrower and one set based on GAAP. To the extent this
Agreement or such other Loan Document requires financial statements to be
accompanied by an opinion of independent accountants, each set of financial
statements shall be accompanied by such an opinion.
ARTICLE II
THE CREDITS
-----------
2.01. Revolving Credit Loans.
----------------------
(a) Revolving Credit Commitments. Subject to the terms and
----------------------------
conditions and relying upon the representations and warranties herein set forth,
each Lender, severally and not jointly, agrees (such agreement being herein
called such Lender's "Revolving Credit Commitment") to make loans (the
"Revolving Credit Loans") to the Borrower at any time or from time to time on or
after the date hereof and to but not including the Revolving Credit Maturity
Date. A Lender shall have no obligation to make any Revolving Credit Loan to
the extent that the aggregate principal amount of such Lender's Revolving Credit
Loans at any time outstanding would exceed such Lender's Revolving Credit
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Committed Amount at such time. Each Lender's "Revolving Credit Committed
Amount" at any time shall be equal to the amount set forth as its "Initial
Revolving Credit Committed Amount" below its name on the signature pages hereof,
and subject to transfer to another Lender as provided in Section 10.14 hereof.
The sum of the Revolving Credit Committed Amounts of the Lenders shall not
exceed $75,000,000 at any time.
(b) Nature of Credit. Within the limits of time and amount set forth
----------------
in this Section 2.01, and subject to the provisions of this Agreement, the
Borrower may borrow, repay and reborrow Revolving Credit Loans hereunder.
(c) Revolving Credit Notes. The obligation of the Borrower to repay
----------------------
the unpaid principal amount of the Revolving Credit Loans made to it by each
Lender and to pay interest thereon shall be evidenced in part by promissory
notes of the Borrower, one to each Lender, dated the Closing Date (the
"Revolving Credit Notes") in substantially the form attached hereto as Exhibit
A, with the blanks appropriately filled, payable to the order of such Lender in
a face amount equal to such Lender's Initial Revolving Credit Committed Amount.
(d) Maturity. To the extent not due and payable earlier, the
--------
Revolving Credit Loans shall be due and payable on the Revolving Credit Maturity
Date.
2.02. Revolving Credit Commitment Fee. The Borrower shall pay to the
-------------------------------
Agent for the account of each Lender a commitment fee (the "Revolving Credit
Commitment Fee") equal to 0.125% per annum (based on a year of 360 days and
actual days elapsed), for each day from and including the date hereof to but not
including the Revolving Credit Maturity Date, on the amount (not less than zero)
equal to (a) 0.8333333333333 times such Lender's Revolving Credit Committed
-----
Amount on each such day minus (b) the sum of (i) the aggregate principal amount
-----
of such Lender's Revolving Credit Loans outstanding on each such day plus (ii)
----
such Lender's Pro Rata share of the aggregate Letter of Credit Exposure on each
such day. Subject to the second proviso of the next sentence, such Revolving
-------
Credit Commitment Fee shall be due and payable for the preceding period for
which such fee has not been paid on each Regular Payment Date and on the
Revolving Credit Maturity Date. The Agent shall deliver to the Borrower on or
immediately before each Regular Payment Date and the Revolving Credit Maturity
Date a notice (which may be by telecopier) setting forth the Revolving Credit
Commitment Fee payable on such Date; provided, that the failure by the Agent to
--------
deliver such notice shall not affect the obligation of the Borrower to pay the
Revolving Credit Commitment Fee; and, provided further, that if the Agent fails
-------- -------
to deliver such notice on or before such Regular Payment Date or the Revolving
Credit Maturity Date, as the case may be, then the Revolving Credit Commitment
Fee shall not be due and payable until the day on which the Agent shall deliver
such notice, if such notice is delivered at or before 2:00 p.m. Pittsburgh time
(and any payment received by the Agent on such day shall be deemed to have been
received on such day, notwithstanding the penultimate sentence of Section
2.10(b) hereof), or the day after the day on which the Agent shall deliver such
notice, if such notice is delivered after 2:00 p.m. Pittsburgh time (in each
case, regardless of whether such day is a Regular Payment Date or the Revolving
Credit Maturity Date).
2.03. Making of Loans. Whenever the Borrower desires that the
---------------
Lenders make Revolving Credit Loans, the Borrower shall provide Standard Notice
to the Agent setting forth the following information (a separate notice being
required for each such type of Loans):
(a) The date, which shall be a Business Day, on which such proposed
Loans are to be made;
(b) The aggregate principal amount of such proposed Loans, which
shall be the sum of the principal amounts selected pursuant to clause (c)
of this Section 2.03;
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(c) The interest rate Option or Options selected in accordance with
Section 2.04(a) hereof and the principal amounts selected in accordance
with Section 2.04(d) hereof of the Base Rate Portion and each Funding
Segment of the Euro-Rate Portion of such proposed Loans; and
(d) With respect to each such Funding Segment of such proposed Loans,
the Funding Period to apply to such Funding Segment, selected in accordance
with Section 2.04(c) hereof.
Standard Notice having been so provided, the Agent shall promptly notify each
Lender of the information contained therein and of the amount of such Lender's
Loan. Unless any applicable condition specified in Article V hereof has not
been satisfied, on the date specified in such Standard Notice each Lender shall
make the proceeds of its Loan available to the Agent at the Agent's Office, no
later than 2:00 o'clock p.m., Pittsburgh time, in funds immediately available at
such Office. The Agent will make the funds so received available to the
Borrower in funds immediately available at the Agent's Office. The Agent shall
notify the Borrower as soon as practicable if for any reason a proposed Loan is
or will not be made on the date requested by the Borrower.
2.04. Interest Rates.
--------------
(a) Optional Bases of Borrowing. The unpaid principal amount of the
---------------------------
Loans shall bear interest for each day until due on one or more bases selected
by the Borrower from among the interest rate Options set forth below. Subject
to the provisions of this Agreement the Borrower may select different Options to
apply simultaneously to different Portions of the Loans and may select different
Funding Segments to apply simultaneously to different parts of the Euro-Rate
Portion of the Loans. The aggregate number of Funding Segments applicable to
the Euro-Rate Portion of the Revolving Credit Loans at any time shall not exceed
twelve and of such Funding Segments, no more than four shall have a Euro-Rate
Funding Period of seven days at any time.
(i) "Base Rate Option": A rate per annum (computed on the basis of
----------------
a year of 360 days and actual days elapsed) for each day equal to the Base
Rate for such day plus the Applicable Margin for such day. The "Base Rate"
for any day shall mean the greater of (A) the Prime Rate for such day or
(B) 0.50% plus the Federal Funds Effective Rate for such day, such interest
rate to change automatically from time to time effective as of the
effective date of each change in the Prime Rate or the Federal Funds
Effective Rate.
(ii) "Euro-Rate Option": A rate per annum (based on a year of 360
----------------
days and actual days elapsed) for each day equal to the Euro-Rate for such
day plus the Applicable Margin for such day. "Euro-Rate" for any day, as
used herein, shall mean for each Funding Segment of the Euro-Rate Portion
corresponding to a proposed or existing Euro-Rate Funding Period the rate
per annum determined by the Agent by dividing (the resulting quotient to be
rounded upward to the nearest 1/100 of 1%) (A) the rate of interest (which
shall be the same for each day in such Euro-Rate Funding Period) determined
in good faith by the Agent in accordance with its usual procedures (which
determination shall be conclusive) to be the average of the rates per annum
for deposits in Dollars offered to major money center banks in the London
interbank market at approximately 11:00 a.m., London time, two London
Business Days prior to the first day of such Euro-Rate Funding Period for
delivery on the first day of such Euro-Rate Funding Period in amounts
comparable to such Funding Segment and having maturities comparable to such
Funding Period by (B) a number equal to 1.00 minus the Euro-Rate Reserve
Percentage for such day.
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<PAGE>
The "Euro-Rate" may also be expressed by the following formula:
[average of the rates offered to major money ]
[center banks in the London interbank market ]
Euro-Rate = [determined by the Agent per subsection (A) ]
-----------------------------------------------
[1.00 - Euro-Rate Reserve Percentage ]
"Euro-Rate Reserve Percentage" for any day shall mean the percentage
(expressed as a decimal, rounded upward to the nearest 1/100 of 1%), as
determined in good faith by the Agent (which determination shall be
conclusive), which is in effect on such day as prescribed by the Board of
Governors of the Federal Reserve System (or any successor) representing the
maximum reserve requirement (including, without limitation, supplemental,
marginal and emergency reserve requirements) with respect to eurocurrency
funding (currently referred to as "Eurocurrency liabilities") of a member
bank in such System. The Euro-Rate shall be adjusted automatically as of
the effective date of each change in the Euro-Rate Reserve Percentage. The
Euro-Rate Option shall be calculated in accordance with the foregoing
whether or not any Lender is actually required to hold reserves in
connection with its eurocurrency funding or, if required to hold such
reserves, is required to hold reserves at the "Euro-Rate Reserve
Percentage" as herein defined.
The Agent shall give prompt notice to the Borrower and to the Lenders
of the Euro-Rate determined or adjusted in accordance with the definition
of the Euro-Rate Reserve Percentage, which determination or adjustment
shall be conclusive if made in good faith.
(b) Applicable Margins.
------------------
(i) Except and to the extent that the conditions set forth in Section
2.04(b)(ii) below apply on a particular day, the "Applicable Margin" for
each interest rate Option for any day shall mean the applicable percentage
set forth below:
Interest Rate Option Applicable Margin
-------------------- -----------------
Base Rate Option Zero
Euro-Rate Option 0.95%
(ii) The Applicable Margin for each interest rate Option for each day
shall mean the applicable percentage set forth below, if and for so long as
(x) no Event of Default or Potential Default shall have occurred and be
continuing and (y) Financial Test A, Financial Test B or Financial Test C
set forth below shall be satisfied for such day. For purposes of
determining the Applicable Margin, Financial Test A, Financial Test B or
Financial Test C, as the case may be, shall be deemed to be satisfied
effective on the first day of the calendar month following the calendar
month in which the Agent shall have received from the Borrower a
certificate, duly completed and signed by a Responsible Officer,
accompanied by the Borrower's financial statements for the fiscal quarter
most recently ended (or, if such most recently ended fiscal quarter is the
last of a Fiscal Year, for the Fiscal Year then ended), demonstrating
compliance with the applicable financial test, and such financial test
shall be deemed to remain satisfied until the earlier of (A) the first day
of the calendar month following the calendar month in which the Agent shall
have received from the Borrower the Borrower's next annual or quarterly
financial statements pursuant to Section 6.01(a) or 6.01(b) hereof
accompanied by the certificate required by this sentence or (B) the last
day of the calendar month in which the Borrower's next annual or quarterly
financial statements are required to be delivered pursuant to Section
6.01(a) or 6.01(b) hereof. Notwithstanding the foregoing, for the period
from the Closing Date until the first day of the calendar month in which
the Agent shall receive the first annual or quarterly
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<PAGE>
financial statements pursuant to Section 6.01(a) or 6.01(b) hereof, for
purposes of the Applicable Margin, Financial Test A, Financial Test B or
Financial Test C, as the case may be, shall be deemed satisfied effective
on the Closing Date if, not less than two Business Days prior to the
Closing Date, the Agent shall have received a certificate, duly completed
and signed by a Responsible Officer, accompanied by the Borrower's
financial statements for the fiscal quarter ended April 1, 1995,
demonstrating compliance with the applicable financial test, and such
financial test shall be deemed to remain satisfied until the earlier of (A)
the first day of the calendar month following the calendar month in which
the Agent shall have received from the Borrower the Borrower's next annual
or quarterly financial statements pursuant to Section 6.01(a) or 6.01(b)
hereof accompanied by the certificate required by the foregoing sentence or
(B) the last day of the calendar month in which the Borrower's next annual
or quarterly financial statements are required to be delivered pursuant to
Section 6.01(a) or 6.01(b) hereof.
FINANCIAL TEST A:
Interest Rate Option Applicable Margin
-------------------- -----------------
Base Rate Option Zero
Euro-Rate Option 0.95%
"Financial Test A" means that, as of the end of the relevant fiscal quarter, the
ratio of Consolidated Funded Debt (Net) as of the end of such fiscal quarter to
Consolidated EBIT for the period of four consecutive fiscal quarters ending on
the last day of such fiscal quarter, considered as a single accounting period,
is greater than 2.25 to 1.00.
FINANCIAL TEST B:
Interest Rate Option Applicable Margin
-------------------- -----------------
Base Rate Option Zero
Euro-Rate Option 0.75%
"Financial Test B" means that, as of the end of the relevant fiscal quarter, the
ratio of Consolidated Funded Debt (Net) as of the end of such fiscal quarter to
Consolidated EBIT for the period of four consecutive fiscal quarters ending on
the last day of such fiscal quarter, considered as a single accounting period,
is less than or equal to 2.25 to 1.00 and greater than 1.50 to 1.00.
FINANCIAL TEST C:
Interest Rate Option Applicable Margin
-------------------- -----------------
Base Rate Option Zero
Euro-Rate Option 0.50%
"Financial Test C" means that, as of the end of the relevant fiscal quarter, the
ratio of Consolidated Funded Debt (Net) as of the end of such fiscal quarter to
Consolidated EBIT for the period of four consecutive fiscal quarters ending on
the last day of such fiscal quarter, considered as a single accounting period,
is less than or equal to 1.50 to 1.00.
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<PAGE>
(c) Funding Periods. At any time when the Borrower shall select,
---------------
convert to or renew the Euro-Rate Option to apply to any part of the Loans, the
Borrower shall specify one or more periods (the "Funding Periods") during which
each such Option shall apply, such Funding Periods being as set forth below:
Interest Rate Option Available Funding Periods
-------------------- -------------------------
Euro-Rate Option Seven days or one, two, three, six or
twelve months ("Euro-Rate Funding Period");
provided, that:
- --------
(i) Each Euro-Rate Funding Period shall begin on a London Business
Day, and the term "month", when used in connection with a Euro-Rate Funding
Period, shall be construed in accordance with prevailing practices in the
interbank eurodollar market at the commencement of such Euro-Rate Funding
Period, as determined in good faith by the Agent (which determination shall
be conclusive);
(ii) The Borrower may not select a Funding Period that would end
after the Revolving Credit Maturity Date; and
(iii) The Borrower shall, in selecting any Funding Period, allow
for foreseeable mandatory prepayments of the Loans.
(d) Transactional Amounts. Every selection of, conversion from,
---------------------
conversion to or renewal of an interest rate Option and every payment or
prepayment of any Loans shall be in a principal amount such that after giving
effect thereto the aggregate principal amount of the Base Rate Portion of the
Revolving Credit Loans or the aggregate principal amount of each Funding Segment
of the Euro-Rate Portion of the Revolving Credit Loans shall be as set forth
below:
Portion or Funding Segment Allowable Aggregate Principal Amounts
-------------------------- -------------------------------------
Base Rate Portion $1,000 or an integral multiple thereof; and
Each Funding Segment $100,000 or an integral multiple of $50,000
of the Euro-Rate Portion in excess thereof.
(e) Euro-Rate Unascertainable; Impracticability. If
-------------------------------------------
(i) on any date on which a Euro-Rate would otherwise be set the
Agent (in the case of clauses (A) or (B) below) or any Lender (in the case
of clause (C) below) shall have determined in good faith (which
determination shall be conclusive) that:
(A) adequate and reasonable means do not exist for ascertaining
such Euro-Rate,
(B) a contingency has occurred which materially and adversely
affects the interbank eurodollar market, or
(C) the effective cost to such Lender of funding a proposed
Funding Segment of the Euro-Rate Portion from a Corresponding Source
of Funds shall exceed the Euro-Rate applicable to such Funding
Segment, or
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<PAGE>
(ii) at any time any Lender shall have determined in good faith
(which determination shall be conclusive) that the making, maintenance or
funding of any part of the Euro-Rate Portion has been made impracticable or
unlawful by compliance by such Lender or a Notional Euro-Rate Funding
Office in good faith with any Law or guideline or interpretation or
administration thereof by any Governmental Authority charged with the
interpretation or administration thereof or with any request or directive
of any such Governmental Authority (whether or not having the force of
law);
then, and in any such event, the Agent or such Lender, as the case may be, may
notify the Borrower of such determination (and any Lender giving such notice
shall notify the Agent). Upon such date as shall be specified in such notice
(which shall not be earlier than the date such notice is given), the obligation
of each of the Lenders to allow the Borrower to select, convert to or renew the
Euro-Rate Option shall be suspended until the Agent or such Lender, as the case
may be, shall have later notified the Borrower (and any Lender giving such
notice shall notify the Agent) of the Agent's or such Lender's determination in
good faith (which determination shall be conclusive) that the circumstance
giving rise to such previous determination no longer exist.
If any Lender notifies the Borrower of a determination under
subsection (ii) of this Section 2.04(e), the Euro-Rate Portion of the Loans of
such Lender (the "Affected Lender") shall automatically be converted to the Base
Rate Option as of the date specified in such notice (and accrued interest
thereon shall be due and payable on such date).
If at the time the Agent or a Lender makes a determination under
subsection (i) or (ii) of this Section 2.04(e) the Borrower previously has
notified the Agent that it wishes to select, convert to or renew the Euro-Rate
Option with respect to any proposed Loans but such Loans have not yet been made,
such notification shall be deemed to provide for selection of, conversion to or
renewal of the Base Rate Option instead of the Euro-Rate Option with respect to
such Loans or, in the case of a determination by a Lender, such Loans of such
Lender.
2.05. Conversion or Renewal of Interest Rate Options.
----------------------------------------------
(a) Conversion or Renewal. Subject to the provisions of Section
---------------------
2.11(b) hereof, and if no Event of Default or Potential Default shall have
occurred and be continuing or shall exist, the Borrower may convert any part of
its Loans from an interest rate Option to the other interest rate Option and may
renew the Euro-Rate Option as to any Funding Segment of the Euro-Rate Portion:
(i) At any time with respect to conversion from the Base Rate Option;
or
(ii) At the expiration of any Funding Period with respect to
conversions from or renewals of the Euro-Rate Option as to the Funding
Segment corresponding to such expiring Funding Period.
Whenever the Borrower desires to convert or renew any interest rate Option, the
Borrower shall provide to the Agent Standard Notice setting forth the following
information:
(w) The date, which shall be a Business Day, on which the proposed
conversion or renewal is to be made;
(x) The principal amounts selected in accordance with Section 2.04(d)
hereof of the Base Rate Portion and each Funding Segment of the Euro-Rate
Portion to be converted from or renewed;
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<PAGE>
(y) The interest rate Option or Options selected in accordance with
Section 2.04(a) hereof and the principal amounts selected in accordance
with Section 2.04(d) hereof of the Base Rate Portion and each Funding
Segment of the Euro-Rate Portion to be converted to; and
(z) With respect to each Funding Segment to be converted to or
renewed, the Funding Period selected in accordance with Section 2.04(c)
hereof to apply to such Funding Segment.
Standard Notice having been so provided, after the date specified in such
Standard Notice, interest shall be calculated upon the principal amount of the
Loans as so converted or renewed. Interest on the principal amount of the Euro-
Rate Portion of the Loans converted or renewed (automatically or otherwise)
shall be due and payable on the conversion or renewal date (unless otherwise due
earlier hereunder) and interest on the principal amount of the Base Rate Portion
of the Loans converted or renewed (automatically or otherwise) shall be due and
payable on the earlier of the next Regular Payment Date or the Revolving Credit
Maturity Date (unless otherwise due earlier hereunder).
(b) Failure to Convert or Renew. Absent due notice from the Borrower
---------------------------
of conversion or renewal in the circumstances described in Section 2.05(a)(ii)
hereof, any part of the Euro-Rate Portion for which such notice is not received
shall be converted automatically to the Base Rate Option on the last day of the
expiring Funding Period.
2.06. Prepayments Generally. Subject to Section 2.08 hereof with
---------------------
respect to mandatory prepayments, whenever the Borrower desires or is required
to prepay any part of its Loans, it shall provide Standard Notice to the Agent
setting forth the following information:
(a) The date, which shall be a Business Day, on which the proposed
prepayment is to be made;
(b) The total principal amount of such prepayment, which shall be the
sum of the principal amounts selected pursuant to clause (c) of this
Section 2.06; and
(c) The principal amounts selected in accordance with Section 2.04(d)
hereof of the Base Rate Portion and each part of each Funding Segment of
the Euro-Rate Portion to be prepaid.
Standard Notice having been so provided, on the date specified in such Standard
Notice, the principal amounts of the Base Rate Portion and each part of the
Euro-Rate Portion specified in such notice, together with interest on each such
principal amount to such date, shall be due and payable.
2.07. Optional Prepayments. The Borrower shall have the right at its
--------------------
option from time to time to prepay its Loans in whole or part without premium or
penalty (subject, however, to Section 2.11(b) hereof):
(a) At any time with respect to any part of the Base Rate Portion; or
(b) At the expiration of any Funding Period with respect to
prepayment of the Euro-Rate Portion with respect to any part of the Funding
Segment corresponding to such expiring Funding Period.
Any such prepayment shall be made in accordance with Section 2.06 hereof.
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<PAGE>
2.08. Mandatory Prepayments.
---------------------
(a) Revolving Credit Committed Amounts. If at any time the aggregate
----------------------------------
Revolving Credit Exposure of the Lenders exceeds the aggregate Revolving Credit
Committed Amounts, the Borrower shall immediately prepay the Revolving Credit
Loans (and then, to the extent of undrawn Letters of Credit, provide cash
collateralization thereof in accordance with the terms hereof) in an aggregate
principal amount not less than the amount of such excess.
(b) Asset Sales. The Borrower shall prepay a principal amount of the
-----------
Loans from time to time in an amount not less than the Net Cash Proceeds upon
the sale of assets in accordance with Section 7.10(b), (c) or (d) hereof,
payable not later than one day after receipt of the related Net Cash Proceeds by
the Borrower or any of its Subsidiaries.
(c) Applicability of Certain Provisions. Prepayments required by
-----------------------------------
this Section 2.08 are subject to all of the terms and conditions applicable to
prepayments generally pursuant to Section 2.06 hereof and Section 2.11(b) hereof
and to all of the terms and conditions applicable to optional prepayments
pursuant to Section 2.07 hereof, except that Sections 2.06(c) and 2.07(b) hereof
shall not apply to such prepayments to the extent necessary to comply with this
Section 2.08. If the Borrower is required to give notice of a prepayment but
for any reason fails to give a notice in accordance with the provisions of this
Agreement, the amount as to which the Borrower is required to have given notice
of prepayment shall nevertheless be deemed due and payable as of the date
required to have been prepaid (for purposes of calculating interest on such
amounts pursuant to Section 2.10(c) hereof and otherwise); provided, that
--------
failure to give notice of a prepayment in accordance with the terms of this
Agreement shall not be deemed to be an Event of Default if the Borrower prepays
when due all amounts required to be prepaid hereunder.
2.09. Interest Payment Dates. Except to the extent expressly
----------------------
provided otherwise herein, interest on the Base Rate Portion shall be due and
payable in arrears on each Regular Payment Date. Except to the extent expressly
provided otherwise herein, interest on each Funding Segment of the Euro-Rate
Portion shall be due and payable in arrears on the last day of the corresponding
Euro-Rate Funding Period and, if such Euro-Rate Funding Period is longer than
three months, also every third month anniversary during such Funding Period.
After maturity of any part of the Loans (by acceleration or otherwise), interest
on such part of the Loans shall be due and payable on demand.
2.10. Pro Rata Treatment; Payments Generally; Interest on Overdue
-----------------------------------------------------------
Amounts.
- -------
(a) Pro Rata Treatment. Each borrowing and conversion and renewal of
------------------
interest rate Options hereunder shall be made, and all payments made in respect
of principal, interest and Revolving Credit Commitment Fees and Letter of Credit
Fees due from the Borrower hereunder or under the Notes shall be applied, Pro
Rata from and to each Lender, except for payments of interest involving an
Affected Lender as provided in Section 2.04(e) hereof and payments to a Lender
subject to a withholding deduction under Section 2.12(c) hereof. The failure of
any Lender to make a Loan shall not relieve any other Lender of its obligation
to lend hereunder, but neither the Agent nor any Lender shall be responsible for
the failure of any other Lender to make a Loan.
(b) Payments Generally. All payments and prepayments to be made by
------------------
the Borrower in respect of principal, interest, fees, indemnity, expenses or
other amounts due from the Borrower hereunder or under any Loan Document shall
be payable in Dollars at 12:00 o'clock Noon, Pittsburgh time, on the day when
due without presentment, demand, protest or notice of any kind, all of which are
hereby expressly waived, and an action therefor shall immediately accrue,
without setoff, counterclaim, withholding or other deduction of any kind or
nature, except for payments to a Lender subject to a withholding deduction under
Section 2.12(c) hereof. Except for payments under Sections 2.11 and 10.06
hereof, such payments shall be made to the Agent at its Office in Dollars in
funds immediately
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<PAGE>
available at such Office, and payments under Sections 2.11 and 10.06 hereof
shall be made to the applicable Lender at such domestic account as it shall
specify to the Borrower from time to time in funds immediately available at such
account. Any payment or prepayment received by the Agent or such Lender after
12:00 o'clock Noon, Pittsburgh time, on any day shall be deemed to have been
received on the next succeeding Business Day. The Agent shall distribute to the
Lenders all such payments received by it from the Borrower within one Business
Day after receipt by the Agent.
(c) Interest on Overdue Amounts. To the extent permitted by law,
---------------------------
after there shall have become due (by acceleration or otherwise) principal,
interest, fees, indemnity, expenses or any other amounts due from the Borrower
hereunder or under any other Loan Document, such amounts shall bear interest for
each day until paid (before and after judgment), payable on demand, at a rate
per annum (in each case based on a year of 360 days and actual days elapsed)
which for each day shall be equal to the following:
(i) In the case of any part of the Euro-Rate Portion of any Loans,
(A) until the end of the applicable then-current Funding Period at a rate
per annum 2% above the rate otherwise applicable to such part, and (B)
thereafter in accordance with the following clause (ii); and
(ii) In the case of any other amount due from the Borrower hereunder
or under any Loan Document, 2% above the then-current Base Rate Option.
To the extent permitted by law, interest accrued on any amount which has become
due hereunder or under any Loan Document shall compound on a day-by-day basis,
and hence shall be added daily to the overdue amount to which such interest
relates.
2.11. Additional Compensation in Certain Circumstances.
------------------------------------------------
(a) Increased Costs or Reduced Return Resulting From Taxes, Reserves,
-----------------------------------------------------------------
Capital Adequacy Requirements, Expenses, Etc. If any Law or guideline or
- --------------------------------------------
interpretation or application thereof by any Governmental Authority charged with
the interpretation or administration thereof or compliance with any request or
directive of any Governmental Authority (whether or not having the force of law)
now existing or hereafter adopted:
(i) subjects any Lender or any Notional Euro-Rate Funding Office to
any tax or changes the basis of taxation with respect to this Agreement,
the Notes, the Loans or payments by the Borrower of principal, interest,
commitment fee or other amounts due from the Borrower hereunder or under
the Notes (except for taxes on the overall net income or overall gross
receipts of such Lender or such Notional Euro-Rate Funding Office imposed
by the jurisdictions (federal, state and local) in which the Lender's
principal office or Notional Euro-Rate Funding Office is located),
(ii) imposes, modifies or deems applicable any reserve, special
deposit or similar requirement against credits or commitments to extend
credit extended by, assets (funded or contingent) of, deposits with or for
the account of, other acquisitions of funds by, such Lender or any Notional
Euro-Rate Funding Office (other than requirements expressly included herein
in the determination of the Euro-Rate hereunder),
(iii) imposes, modifies or deems applicable any capital adequacy or
similar requirement (A) against assets (funded or contingent) of, or
credits or commitments to extend credit extended by, any Lender or any
Notional Euro-Rate Funding Office, or (B) otherwise applicable to the
obligations of any Lender or any Notional Euro-Rate Funding Office under
this Agreement, or
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(iv) imposes upon any Lender or any Notional Euro-Rate Funding
Office any other condition or expense with respect to this Agreement, the
Notes or its making, maintenance or funding of any Loan,
and the result of any of the foregoing is to increase the cost to, reduce the
income receivable by, or impose any expense (including loss of margin) upon any
Lender, any Notional Euro-Rate Funding Office or, in the case of clause (iii)
hereof, any Person controlling a Lender, with respect to this Agreement, the
Notes or the making, maintenance or funding of any Loan (or, in the case of any
capital adequacy or similar requirement, to have the effect of reducing the rate
of return on such Lender's or controlling Person's capital, taking into
consideration such Lender's or controlling Person's policies with respect to
capital adequacy) by an amount which such Lender deems to be material (such
Lender being deemed for this purpose to have made, maintained or funded each
Funding Segment of the Euro-Rate Portion from a Corresponding Source of Funds),
such Lender may from time to time notify the Borrower of the amount determined
in good faith (using any averaging and attribution methods) by such Lender
(which determination shall be conclusive) to be necessary to compensate such
Lender or such Notional Euro-Rate Funding Office for such increase, reduction or
imposition. Such amount shall be due and payable by the Borrower to such Lender
ten Business Days after such notice is given, together with an amount equal to
interest on such amount from the date two Business Days after the date of such
notice until such due date at the Base Rate Option. A certificate by such
Lender as to the amount due and payable under this Section 2.11(a) from time to
time and the method of calculating such amount, together with a brief
explanation thereof, shall be conclusive absent manifest error. Each Lender
agrees that it will use good faith efforts to notify the Borrower of the
occurrence of any event that would give rise to a payment under this Section
2.11(a); provided, however, that any failure of such Lender to give any such
--------
notice shall have no effect on the Borrower's obligations hereunder (other than
by virtue of the fact that such amount is not due and payable hereunder until
ten Business Days after such Lender gives such notice).
(b) Funding Breakage. In addition to all other amounts payable
----------------
hereunder, if and to the extent for any reason any part of any Funding Segment
of any Euro-Rate Portion of the Loans becomes due (by acceleration or
otherwise), or is paid, prepaid or converted to another interest rate Option
(whether or not such payment, prepayment or conversion is mandatory or automatic
and whether or not such payment or prepayment is then due), on a day other than
the last day of the corresponding Funding Period (the date such amount so
becomes due, or is so paid, prepaid or converted, being referred to as the
"Funding Breakage Date"), the Borrower shall pay each Lender an amount ("Funding
Breakage Indemnity") determined by such Lender as follows:
(i) first, calculate the following amount: (A) the principal amount of
such Funding Segment of the Loans owing to such Lender which so became due,
or which was so paid, prepaid or converted, times (B) the greater of (x)
zero or (y) the rate of interest applicable to such principal amount on the
Funding Breakage Date minus the Treasury Rate as of the Funding Breakage
Date, times (C) the number of days from and including the Funding Breakage
Date to but not including the last day of such Funding Period, times (D)
1/360;
(ii) the Funding Breakage Indemnity to be paid by the Borrower to such
Lender shall be the amount equal to the present value as of the Funding
Breakage Date (discounted at the Treasury Rate as of such Funding Breakage
Date, and calculated on the basis of a year of 365 or 366 days, as the case
may be, and actual days elapsed) of the amount described in the preceding
clause (i) (which amount described in the preceding clause (i) is assumed
for purposes of such present value calculation to be payable on the last
day of the corresponding Funding Period).
Such Funding Breakage Indemnity shall be due and payable on demand, and each
Lender shall, upon making such demand, notify the Agent of the amount so
demanded. In addition, the Borrower shall, on the due date for payment of any
Funding Breakage Indemnity, pay to such Lender an additional amount
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equal to interest on such Funding Breakage Indemnity from the Funding Breakage
Date to but not including such due date at the Base Rate Option (calculated on
the basis of a year of 360 days and actual days elapsed). The amount payable to
each Lender under this Section 2.11(b) shall be determined in good faith by such
Lender, and such determination shall be conclusive absent manifest error.
2.12 Taxes.
-----
(a) Payments Net of Taxes. All payments made by the Borrower under
---------------------
this Agreement or any other Loan Document shall be made free and clear of, and
without reduction or withholding for or on account of, any present or future
income, stamp or other taxes, levies, imposts, duties, charges, fees, deductions
or withholdings, now or hereafter imposed, levied, collected, withheld or
assessed by any Governmental Authority, and all liabilities with respect
thereto, excluding
(i) in the case of the Agent and each Lender, income or franchise
taxes imposed on the Agent or such Lender by the jurisdiction under the
laws of which the Agent or such Lender is organized or any political
subdivision or taxing authority thereof or therein or as a result of a
connection between such Lender and any jurisdiction other than a connection
resulting solely from this Agreement and the transactions contemplated
hereby, and
(ii) in the case of each Lender, income or franchise taxes imposed by
any jurisdiction in which such Lender's lending offices which make or book
Loans are located or any political subdivision or taxing authority thereof
or therein
(all such non-excluded taxes, levies, imposts, deductions, charges or
withholdings being hereinafter called "Taxes"). If any Taxes are required to be
withheld or deducted from any amounts payable to the Agent or any Lender under
this Agreement or any other Loan Document, the Borrower shall pay the relevant
amount of such Taxes and the amounts so payable to the Agent or such Lender
shall be increased to the extent necessary to yield to the Agent or such Lender
(after payment of all Taxes) interest or any such other amounts payable
hereunder at the rates or in the amounts specified in this Agreement and the
other Loan Documents. Whenever any Taxes are paid by the Borrower with respect
to payments made in connection with this Agreement or any other Loan Document,
as promptly as possible thereafter, the Borrower shall send to the Agent for its
own account or for the account of such Lender, as the case may be, a certified
copy of an original official receipt received by the Borrower showing payment
thereof.
(b) Indemnity. The Borrower hereby indemnifies the Agent and each of
---------
the Lenders for the full amount of all Taxes attributable to payments by or on
behalf of the Borrower to the Agent or such Lender hereunder or under any of the
other Loan Documents, any non-refunded Taxes paid by the Agent or such Lender,
as the case may be, and any present or future claims, liabilities or losses with
respect to or resulting from any omission to pay or delay in paying any Taxes
(including any incremental Taxes, interest or penalties that may become payable
by the Agent or such Lender as a result of any failure to pay such Taxes),
whether or not such Taxes were correctly or legally asserted, other than claims,
liabilities or losses incurred by the Agent or such Lender as a result of its
gross negligence or willful misconduct. Such indemnification shall be made
within 30 days from the date such Lender or the Agent, as the case may be, makes
written demand therefor.
(c) Withholding and Backup Withholding. Each Lender that is
----------------------------------
incorporated or organized under the laws of any jurisdiction other than the
United States or any State thereof agrees that, on or prior to the date any
payment is due to be made to it hereunder or under any other Loan Document, it
will furnish to the Borrower and the Agent
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(i) two valid, duly completed copies of United States Internal Revenue
Service Form 4224 or United States Internal Revenue Form 1001 or successor
applicable form, as the case may be, certifying in each case that such
Lender is entitled to receive payments under this Agreement and the other
Loan Documents without deduction or withholding of any United States
federal income taxes and
(ii) a valid, duly completed Internal Revenue Service Form W-8 or W-9
or successor applicable form, as the case may be, to establish an exemption
from United States backup withholding tax.
Each Lender which so delivers to the Borrower and the Agent a Form 1001 or 4224
and Form W-8 or W-9, or successor applicable forms agrees to deliver to the
Borrower and the Agent two further copies of the said Form 1001 or 4224 and Form
W-8 or W-9, or successor applicable forms, or other manner of certification, as
the case may be, on or before the date that any such form expires or becomes
obsolete or otherwise is required to be resubmitted as a condition to obtaining
an exemption from withholding tax, or after the occurrence of any event
requiring a change in the most recent form previously delivered by it, and such
extensions or renewals thereof as may reasonably be requested by the Borrower
and the Agent, certifying in the case of a Form 1001 or Form 4224 that such
Lender is entitled to receive payments under this Agreement or any other Loan
Document without deduction or withholding of any United States federal income
taxes, unless in any such cases an event (including any changes in Law) has
occurred prior to the date on which any such delivery would otherwise be
required which renders all such forms inapplicable or which would prevent such
Lender from duly completing and delivering any such letter or form with respect
to it and such Lender advises the Borrower and the Agent that it is not capable
of receiving payments without any deduction or withholding of United States
federal income tax, and in the case of a Form W-8 or W-9, establishing an
exemption from United States backup withholding tax.
2.13. Funding by Branch, Subsidiary or Affiliate.
------------------------------------------
(a) Notional Funding. Each Lender shall have the right from time to
----------------
time, prospectively or retrospectively, without notice to the Borrower, to deem
any branch, subsidiary or affiliate of such Lender to have made, maintained or
funded any part of the Euro-Rate Portion at any time. Any branch, subsidiary or
affiliate so deemed shall be known as a "Notional Euro-Rate Funding Office."
Such Lender shall deem any part of the Euro-Rate Portion of the Loans or the
funding therefor to have been transferred to a different Notional Euro-Rate
Funding Office if such transfer would avoid or cure an event or condition
described in Section 2.04(e)(ii) hereof or would lessen compensation payable by
the Borrower under Section 2.11(a) hereof, and if such Lender determines in its
sole discretion that such transfer would be practicable and would not have a
material adverse effect on such part of the Loans, such Lender or any Notional
Euro-Rate Funding Office (it being assumed for purposes of such determination
that each part of the Euro-Rate Portion is actually made or maintained by or
funded through the corresponding Notional Euro-Rate Funding Office). Notional
Euro-Rate Funding Offices may be selected by such Lender without regard to such
Lender's actual methods of making, maintaining or funding Loans or any sources
of funding actually used by or available to such Lender.
(b) Actual Funding. Each Lender shall have the right from time to
--------------
time to make or maintain any part of the Euro-Rate Portion by arranging for a
branch, subsidiary or affiliate of such Lender to make or maintain such part of
the Euro-Rate Portion. Such Lender shall have the right to (i) hold any
applicable Note payable to its order for the benefit and account of such branch,
subsidiary or affiliate or (ii) request the Borrower to issue one or more
promissory notes in the principal amount of such Euro-Rate Portion, in
substantially the form attached hereto as Exhibit A, with the blanks
appropriately filled, payable to such branch, subsidiary or affiliate and with
appropriate changes reflecting that the holder thereof is not obligated to make
any additional Loans to the Borrower. The Borrower agrees to comply promptly
with any request under subsection (ii) of this Section 2.13(b). If
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<PAGE>
any Lender causes a branch, subsidiary or affiliate to make or maintain any part
of the Euro-Rate Portion hereunder, all terms and conditions of this Agreement
shall, except where the context clearly requires otherwise, be applicable to
such part of the Euro-Rate Portion and to any note payable to the order of such
branch, subsidiary or affiliate to the same extent as if such part of the Euro-
Rate Portion were made or maintained and such note were a Revolving Credit Note
payable to such Lender's order.
ARTICLE III
THE LETTER OF CREDIT SUBFACILITY
--------------------------------
3.01. The Letter of Credit Subfacility.
--------------------------------
(a) General. Subject to the terms and conditions of this Agreement
-------
and the Letter of Credit Agreement, and relying upon the representations and
warranties herein and therein set forth and upon the agreements of the Lenders
set forth in Sections 3.03 and 3.04 hereof, the Issuing Bank may issue for the
account of the Borrower standby letters of credit (each, as amended, modified or
supplemented from time to time, a "Standby Letter of Credit") and merchandise
letters of credit (each, as amended, modified, or supplemented from time to
time, a "Merchandise Letter of Credit") (Standby Letters of Credit and
Merchandise Letters of Credit being collectively referred to as "Letters of
Credit") at any time or from time to time on or after the date hereof. The
Borrower shall not request any Letter of Credit to be issued except within the
following limitations: (i) no Letter of Credit shall be issued later than 60
days before the Revolving Credit Maturity Date, (ii) at the time any Letter of
Credit is issued, the aggregate Revolving Credit Exposures of the Lenders (after
giving effect to issuance of the requested Letter of Credit) shall not exceed
the sum of the Revolving Credit Committed Amounts of the Lenders at such time
and (iii) on the date of issuance of any Letter of Credit (and after giving
effect to such issuance) the aggregate Letter of Credit Exposure shall not
exceed $15,000,000.
(b) Terms of Letters of Credit. The Borrower shall not request any
--------------------------
Letter of Credit to be issued except within the following limitations: each
Letter of Credit (i) shall have an expiration date no later than the earlier of
(A) 12 months after the date of issuance thereof or (B) 60 days prior to the
Revolving Credit Maturity Date, (ii) shall be denominated in Dollars and (iii)
shall be payable only against sight drafts.
(c) Purposes of Letters of Credit. Each Letter of Credit shall be
-----------------------------
satisfactory in form, substance and beneficiary to the Issuing Bank in its
discretion. Each Standby Letter of Credit shall be used by the Borrower as a
standby letter of credit to provide credit enhancement for workers' compensation
obligations, contract performance guarantees, leasing arrangements and like
bonding requirements, all in the ordinary course of business of the Borrower,
and to provide credit enhancement for the IDA Facility and for Indebtedness
permitted by Section 7.03(g) hereof. Except with respect to the IDA Facility
and Indebtedness permitted by Section 7.03(g) hereof, Standby Letters of Credit
shall not be used to provide credit support for any Indebtedness or other direct
or indirect financing arrangements of the Borrower or any other Person. Each
Merchandise Letter of Credit shall be used by the Borrower as a means of payment
for goods to be used by the Borrower, all in the ordinary course of business of
the Borrower. The provisions of this Section 3.01(c) represent only an
obligation of the Borrower to the Issuing Bank and the Lenders; the Issuing Bank
shall have no obligation to the Lenders to ascertain the purpose of any Letter
of Credit, and the rights and obligations of the Lenders and the Issuing Bank
among themselves shall not be impaired or affected by a breach of this Section
3.01(c).
(d) Standby Letter of Credit Fee. The Borrower shall pay to the
----------------------------
Agent for the account of each Lender a fee (the "Standby Letter of Credit Fee")
equal to the percentage set forth below (based on a year of 360 days and actual
days elapsed), for each outstanding Standby Letter of Credit for each day from
and including the date of issuance thereof to and including the date of
expiration or termination thereof, on the Undrawn Availability of such
outstanding Standby Letter of Credit on such day:
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(i) On each day other than a day on which Financial Test B or
Financial Test C is satisfied, 0.875%.
(ii) On each day on which Financial Test B is satisfied, 0.75%.
(iii) On each day on which Financial Test C is satisfied, 0.50%.
Such Standby Letter of Credit Fee shall be due and payable for the preceding
period for which such fee has not been paid on each of the following dates: (i)
each Regular Payment Date subsequent to the date of issuance of such Standby
Letter of Credit, (ii) the date of each drawing on such Standby Letter of
Credit, and (iii) the date of expiration or termination of such Standby Letter
of Credit.
(e) Merchandise Letter of Credit Fee. The Borrower shall pay to the
--------------------------------
Agent for the account of each Lender, on the date of issuance of each
Merchandise Letter of Credit, a non-refundable fee (the "Merchandise Letter of
Credit Fee") equal to 0.25% of the Stated Amount of such Merchandise Letter of
Credit.
(f) Facing Fee; Administration Fees. The Borrower shall pay to the
-------------------------------
Agent, for the sole account of the Issuing Bank, for each Letter of Credit, on
the date of issuance of such Letter of Credit, a fee (the "Letter of Credit
Facing Fee") equal to 0.125% per annum (based on a year of 360 days and actual
days elapsed), for each day from and including the date of issuance of such
Letter of Credit to and including the date of expiration of such Letter of
Credit, of the Stated Amount of such Letter of Credit. Such fee shall be
payable on each Regular Payment Date, on the date of each drawing under such
Letter of Credit and on the date of the expiration of such Letter of Credit, for
the preceding period for which such fee has not been paid. In addition, the
Borrower shall pay to the Agent, for the sole account of the Issuing Bank, such
other administration, maintenance, amendment, drawing and negotiation fees as
may be customarily charged by the Issuing Bank from time to time in connection
with letters of credit.
(g) Prior Letters of Credit. The letters of credit issued by Mellon
-----------------------
or any Affiliate of Mellon under the Asset Based Lending Facility and
outstanding on the Closing Date, as listed on Schedule 3.01(g) hereof ("Prior
Letters of Credit"), shall, as of the Closing Date, automatically and without
further action be deemed to be Letters of Credit issued under this Agreement and
the Letter of Credit Agreement. The Borrower hereby represents and warrants
that such Prior Letters of Credit will comply with the limitations set forth in
Sections 3.01(a) and 3.01(b) hereof as of the Closing Date as if issued
hereunder on the Closing Date and that such Prior Letters of Credit are Standby
Letters of Credit. Fees with respect to such Prior Letters of Credit for each
day to and including the Closing Date shall accrue at the rates set forth under
the Asset Based Lending Facility and shall be payable on the Closing Date, and
fees with respect to such Prior Letters of Credit for each day after the Closing
Date shall accrue and be payable as provided for Letters of Credit in this
Agreement.
3.02. Procedure for Issuance and Amendment of Letters of Credit.
---------------------------------------------------------
(a) Request for Issuance. The Borrower may from time to time
--------------------
request, upon notice delivered at least three Business Days' prior to the
proposed date of issuance, that Mellon issue (or cause another Affiliate of
Mellon selected by Mellon to issue) a Letter of Credit by:
(i) delivering to Mellon (or such Affiliate as Mellon may from time to
time designate) and the Agent a written request to such effect, specifying
the date on which such Letter of Credit is to be issued, the expiration
date thereof, and the Stated Amount thereof, and
(ii) delivering to the Issuing Bank an application, in the form
attached as Exhibit B-1 for Standby Letters of Credit (the "Standby Letter
of Credit Application") or Exhibit B-2 for Merchandise Letters of Credit
(the "Merchandise Letter of Credit Application" and, together
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with the Standby Letter of Credit Application, the "Letter of Credit
Applications"), completed to the satisfaction of the Issuing Bank, together
with such other certificates, documents and other papers and information as
the Issuing Bank may request.
Upon receipt of the foregoing, the Issuing Bank shall promptly notify the Agent
(by telephone or otherwise), and the Issuing Bank shall furnish the Agent with
the proposed form of Letter of Credit to be issued. The Agent shall, promptly
upon receiving such notice, notify the Lenders of such proposed Letter of Credit
(which notice shall specify the Stated Amount and term of such proposed Letter
of Credit), and shall determine, as of the close of business on the Business Day
before such proposed issuance, whether such proposed Letter of Credit complies
with the limitations set forth in Sections 3.01(a), 3.01(b) and 3.01(c) hereof.
Unless such limitations are not satisfied, or unless the Required Lenders have
given notice to the Agent to cease issuing Letters of Credit pursuant to Section
3.02(c)(iii) hereof, the Agent shall notify the Issuing Bank (in writing or by
telephone promptly confirmed in writing) that the Issuing Bank is authorized to
issue such Letter of Credit and, unless any other applicable condition specified
in this Article III, the Letter of Credit Agreement or the Letter of Credit
Application has not been satisfied and unless any applicable condition set forth
in Article V hereof or in the Letter of Credit Agreement has not been satisfied,
the Issuing Bank shall issue the Letter of Credit on the date requested by the
Borrower pursuant to Section 3.02(a)(i) hereof. The Issuing Bank shall deliver
the original of such Letter of Credit to the beneficiary thereof or as the
Borrower shall otherwise direct, and shall promptly notify the Agent thereof and
furnish a copy thereof to the Agent.
(b) Request for Extension or Increase. The Borrower may from time to
---------------------------------
time request the Issuing Bank to extend the expiration date of an outstanding
Letter of Credit or increase the Undrawn Availability of such Letter of Credit.
Such extension or increase shall for all purposes hereunder be treated as though
the Borrower had requested issuance of a Letter of Credit hereunder (except only
that the Issuing Bank may, if it elects, issue a notice of extension or increase
in lieu of issuing a new Letter of Credit in substitution for the outstanding
Letter of Credit).
(c) Limitations on Issuance, Extension and Amendment.
------------------------------------------------
(i) As between the Borrower, on the one hand, and the Issuing Bank,
the Agent and the Lenders, on the other hand, issuance or extension of any
Letter of Credit is within the discretion of the Issuing Bank.
(ii) As between the Issuing Bank, on the one hand, and the Agent and
the Lenders, on the other hand, the Issuing Bank shall be justified and
fully protected in issuing such Letter of Credit after receiving
authorization from the Agent as provided in Section 3.02(a) hereof,
notwithstanding any subsequent notices to the Issuing Bank, any knowledge
of an Event of Default or Potential Default, any knowledge of failure of
any condition specified in Section 5.02 hereof to be satisfied, any other
knowledge of the Issuing Bank, or any other event, condition or
circumstance whatever. The Issuing Bank may amend, modify or supplement
Letters of Credit or Letter of Credit Applications, or waive compliance to
any condition of issuance or payment, without the consent of, and without
liability to, the Agent or any Lender, provided that any such amendment,
modification or supplement that extends the expiration date or increases
the Letter of Credit Undrawn Availability of an outstanding Letter of
Credit shall be subject to Section 3.02(b) hereof.
(iii) As between the Agent, on the one hand, and the Lenders, on the
other hand, the Agent shall not authorize issuance of any Letter of Credit
if the Agent shall have received, at least two Business Days before
authorizing such issuance, from the Required Lenders an unrevoked written
notice that any condition precedent set forth in Section 5.02 will not be
satisfied and expressly requesting that the Agent direct the Issuing Bank
to cease to issue Letters of Credit. Absent such notice, or unless the
Agent determines that the applicable limitations set
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forth in Sections 3.01(a), 3.01(b) and 3.01(c) hereof are not satisfied or
if the Agent has actual knowledge of an Event of Default or Potential
Default or any knowledge of failure of any condition specified in Section
5.02 hereof to be satisfied, the Agent shall be justified and fully
protected, as against the Lenders, in authorizing the Issuing Bank to issue
such Letter of Credit, notwithstanding any subsequent notices to the Agent,
any other knowledge of the Agent, or any other event, condition or
circumstance whatever.
3.03. Letter of Credit Participating Interests.
----------------------------------------
(a) Generally. Concurrently with the issuance of each Letter of
---------
Credit, the Issuing Bank automatically shall be deemed, irrevocably and
unconditionally, to have sold, assigned, transferred and conveyed to each other
Lender, and each other Lender automatically shall be deemed, irrevocably and
unconditionally, severally to have purchased, acquired, accepted and assumed
from the Issuing Bank, without recourse to, or representation or warranty by,
the Issuing Bank, an undivided interest, in a proportion equal to such Lender's
Pro Rata share, in all of the Issuing Bank's rights and obligations in, to or
under such Letter of Credit, the related Letter of Credit Application, the
Letter of Credit Agreement, the Reimbursement Obligations and all collateral,
guarantees and other rights from time to time directly or indirectly securing
the foregoing (such interest of each Lender being referred to herein as a
"Letter of Credit Participating Interest"). Amounts other than Letter of Credit
Reimbursement Obligations and Letter of Credit Fees payable from time to time
under or in connection with the Letter of Credit Agreement or a Letter of Credit
or Letter of Credit Application shall be for the sole account of the Issuing
Bank. On the date that any Purchasing Lender becomes a party to this Agreement
in accordance with Section 10.14 hereof, Letter of Credit Participating
Interests in any outstanding Letters of Credit held by the Lender from which
such Purchasing Lender acquired its interest hereunder shall be proportionately
reallotted between such Purchasing Lender and such transferor Lender.
(b) Obligations Absolute. Notwithstanding any other provision
--------------------
hereof, each Lender hereby agrees that its obligation to participate in each
Letter of Credit issued in accordance herewith, its obligation to make the
payments specified in Section 3.04 hereof, and the right of the Issuing Bank to
receive such payments in the manner specified therein, are each absolute,
irrevocable and unconditional and shall not be affected by any event, condition
or circumstance whatever. The failure of any Lender to make any such payment
shall not relieve any other Lender of its funding obligation hereunder on the
date due, but no Lender shall be responsible for the failure of any other Lender
to meet its funding obligations hereunder.
3.04. Letter of Credit Drawings and Reimbursements.
--------------------------------------------
(a) Borrower's Reimbursement Obligation. If the Issuing Bank makes a
-----------------------------------
payment under any Letter of Credit, the Issuing Bank shall promptly notify the
Agent (which notice may be by telephone) and the Agent shall promptly notify the
Borrower (which notice may be by telephone) of such payment. The Borrower
hereby agrees to reimburse the Issuing Bank, by making payment to the Agent for
the account of the Issuing Bank in accordance with Section 2.10(b) hereof, on
the day after notice of such payment made by the Issuing Bank under any Letter
of Credit, without further notice, protest or demand, all of which are hereby
waived, and an action therefor shall immediately accrue. To the extent such
payment is not timely made, the Borrower hereby agrees to pay to the Agent, for
the account of the Issuing Bank, on demand, interest on any Unreimbursed Draws
for each day from and including the date of such payment by the Issuing Bank
until paid (before and after judgment) in accordance with Section 2.10(c)
hereof, at the rate per annum set forth in Section 2.10(c)(ii) hereof.
(b) Payment by Lenders on Account of Unreimbursed Draws. If the
---------------------------------------------------
Issuing Bank makes a payment under any Letter of Credit and is not reimbursed in
full therefor on the date when due in accordance with Section 3.04(a) hereof,
the Issuing Bank will promptly notify the Agent thereof (which notice may
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be by telephone), and the Agent shall forthwith notify each Lender (which notice
may be by telephone) thereof. No later than the Agent's close of business on the
date such notice is given if such notice is given before 11:00 a.m., Pittsburgh
time, or the next Business Day, if such notice is given after 11:00 a.m.,
Pittsburgh time, each such Lender will pay to the Agent, for the account of the
Issuing Bank, in immediately available funds, an amount equal to such Lender's
Pro Rata share of the unreimbursed portion of such payment by the Issuing Bank.
If and to the extent that any Lender fails to make such payment to the Issuing
Bank on such date, such Lender shall pay such amount on demand, together with
interest, for the Issuing Bank's own account, for each day from and including
the date such payment is due to and including the date of repayment to the
Issuing Bank (before and after judgment) at the following rates per annum:
(x) for each day from and including the date of such payment by the Issuing Bank
to and including the second Business Day thereafter, at the Federal Funds
Effective Rate plus 0.50% for each such day, and (y) for each day thereafter, at
the rate applicable to Unreimbursed Draws for each such day.
(c) Distributions to Participants. If, at any time, after the
-----------------------------
Issuing Bank has made an Unreimbursed Draw and has received from any Lender such
Lender's share of such Letter of Credit Unreimbursed Draw, and the Issuing Bank
receives any payment or makes any application of funds on account of the
Reimbursement Obligation arising from such Unreimbursed Draw, the Issuing Bank
will pay to the Agent, for the account of such Lender, such Lender's Pro Rata
share of such payment.
(d) Rescission. If any amount received by the Issuing Bank on
----------
account of any Reimbursement Obligation shall be avoided, rescinded or otherwise
returned or paid over by the Issuing Bank for any reason at any time, whether
before or after the termination of this Agreement (or the Issuing Bank believes
in good faith that such avoidance, rescission, return or payment is required,
whether or not such matter has been adjudicated), each such Lender will,
promptly upon notice from the Agent or the Issuing Bank, pay over to the Agent
for the account of the Issuing Bank its Pro Rata share of such amount, together
with its Pro Rata share of any interest or penalties payable with respect
thereto.
(e) Equalization. If any Lender receives any payment or makes any
------------
application on account of its Letter of Credit Participating Interest, such
Lender shall forthwith pay over to the Issuing Bank, in Dollars and in like kind
of funds received or applied by it the amount in excess of such Lender's ratable
share of the amount so received or applied.
3.05. Obligations Absolute. The payment obligations of the Borrower
--------------------
under Section 3.04 shall be unconditional and irrevocable and shall be paid
strictly in accordance with the terms of this Agreement under all circumstances,
including, without limitation, the following circumstances:
(a) any lack of validity or enforceability of this Agreement, any
Letter of Credit, the Letter of Credit Agreement or any other Loan
Document,
(b) the existence of any claim, set-off, defense or other right which
the Borrower or any other Person may have at any time against any
beneficiary or transferee of any Letter of Credit (or any Persons for whom
any such beneficiary or transferee may be acting), the Issuing Bank, any
Lender, or any other Person, whether in connection with this Agreement, the
transactions contemplated hereby or any unrelated transaction;
(c) any draft, certificate, statement or other document presented
under any 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; provided, however, that payment by the Issuing
-------- -------
Bank under such Letter of Credit against presentation of such draft,
certificate, statement or other document shall not have constituted gross
negligence or willful misconduct;
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(d) payment by the Issuing Bank under any Letter of Credit against
presentation of a draft or certificate which does not comply with the terms
of such Letter of Credit, or payment by the Issuing Bank under the Letter
of Credit in any other circumstances in which conditions to payment are not
met, except any such payment resulting solely from the gross negligence or
willful misconduct of such Issuing Bank; or
(e) any other event, condition or circumstance whatever, whether or
not similar to any of the foregoing; provided, however, that payment by the
-------- -------
Issuing Bank of any Letter of Credit in light of such event, condition or
circumstance shall not have constituted gross negligence or willful
misconduct.
The Borrower bears the risk of, and none of the Agent, the Lenders or the
Issuing Bank, nor any of their respective directors, officers, employees or
agents, shall be liable or responsible for any of, the foregoing matters, the
use which may be made of any Letter of Credit, or acts or omissions of the
beneficiary or any transferee in connection therewith.
3.06. Additional Compensation in Certain Circumstances. Without
------------------------------------------------
limitation of any provision of Section 2.11(a) hereof, each Issuing Bank and
each Lender shall be entitled to the benefit of Section 2.11(a) hereof, and the
Borrower shall pay additional compensation to each Issuing Bank and each Lender
in accordance with such Section 2.11(a), in respect of this Agreement, the
Letters of Credit and Letter of Credit Participating Interests, to the same
extent and in the same manner as if the word "Lender," in each place in which it
occurs in such Section 2.11(a), were replaced with "Lender or Issuing Bank," and
the word "Loan," in each place in which it occurs in such Section 2.11(a), were
replaced with "Loan, Letter of Credit or Letter of Credit Participating
Interest."
3.07. Further Assurances. The Borrower hereby agrees, from time to
------------------
time, to do and perform any and all acts and to execute any and all further
instruments reasonably requested by the Issuing Bank more fully to effect the
purposes of this Agreement, the Letter of Credit Agreement, the Letter of Credit
Applications and the issuance of the Letters of Credit hereunder.
3.08. Letter of Credit Agreement and Applications. The
-------------------------------------------
representations, warranties and covenants by the Borrower under, rights and
remedies of the Issuing Bank under, the Letter of Credit Agreement and a Letter
of Credit Application relating to any Letter of Credit are in addition to, and
not in limitation or derogation of, representations, warranties and covenants by
the Borrower under, and rights and remedies of the Issuing Bank and the Lenders
under, this Agreement, the other Loan Documents and applicable Law. The
Borrower acknowledges and agrees that all rights of the Issuing Bank under the
Letter of Credit Agreement and any Letter of Credit Application shall inure to
the benefit of each Lender to the extent of its Commitment Percentage as fully
as if such Lender was a party to the Letter of Credit Agreement and such Letter
of Credit Application. In the event of any inconsistency between the terms of
this Agreement and the Letter of Credit Agreement or any Letter of Credit
Application, this Agreement shall prevail. Without limiting the generality of
the foregoing, Sections A.7, A.8 and B.3 of the Letter of Credit Agreement shall
not apply to Letters of Credit.
3.09. Cash Collateral for Letters of Credit.
-------------------------------------
(a) The Borrower agrees that without limitation of other rights and
remedies under this Agreement or at law or in equity, following the occurrence
of any Event of Default, it shall, immediately upon request from time to time by
the Agent delivered at the request of the Required Lenders (or, in case of an
Event of Default referred to in Section 8.01(p) or (q) hereof, automatically
upon the occurrence of such Event of Default without any such notice under this
Section 3.09(a)) pay to the Agent in Dollars and in immediately available funds
an amount equal to the excess of the aggregate Letter of Credit Exposure at such
time over the balance in the LC Collateral Account. Any amounts so received by
the Agent shall be deposited by the Agent into the LC Collateral Account.
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(b) LC Collateral Account.
---------------------
(i) The Agent shall maintain in its own name (in its capacity as
Agent) a non-interest bearing deposit account (the "LC Collateral Account")
over which the Agent shall have sole dominion and control, and the Borrower
shall have no right to withdraw or to cause the Agent to withdraw any funds
deposited therein. The Agent shall deposit into the LC Collateral Account
such funds as this Agreement requires or permits to be paid therein
pursuant to Section 3.09(a) hereof.
(ii) The Agent shall apply funds in the LC Collateral Account: (A) on
account of Reimbursement Obligations as and when the same become due and
payable if and to the extent that the Borrower fails directly to pay the
same, and (B) if no Reimbursement Obligations are due and payable and the
balance of the LC Collateral Account exceeds the aggregate Letter of Credit
Exposure, the excess shall be applied on account of the Obligations as the
same become due and payable in accordance with Section 8.02 hereof. If all
Obligations have been paid in full, all Commitments terminated and all
Letters of Credit have expired, promptly following demand by the Borrower
the Agent shall release to the Borrower all remaining funds in the LC
Collateral Account.
3.10. Indemnification of Issuing Bank. The Borrower hereby agrees to
-------------------------------
indemnify and hold the Issuing Bank and its officers, directors, employees and
agents ("LC Indemnified Parties") harmless from and against any and all claims,
damages, losses, liabilities, costs or expenses of any nature whatsoever
(including without limitation reasonable attorneys' fees) which at any time may
be imposed upon, incurred by, or asserted against such LC Indemnified Party in
any way arising from or relating to the execution, delivery or use or transfer
of, or payment of, or failure to pay under, or use of proceeds of, any Letter of
Credit, except for any claims, damages, losses, liabilities, costs or expenses
to the extent, but only to the extent, caused by the Issuing Bank's gross
negligence or willful misconduct in connection with the matters referred to in
Sections 3.05(c), (d) and (e) hereof. Without limiting the foregoing
obligation, each Lender agrees to reimburse and indemnify the Issuing Bank, Pro
Rata, for and against any and all amounts required to be reimbursed by the
Borrower pursuant to the preceding sentence but not so reimbursed. The
agreements in this Section 3.10 shall survive the payment of the Loans,
termination of this Agreement and all other events whatever.
3.11. The Issuing Bank and the Lenders.
--------------------------------
(a) The Issuing Bank may consult with legal counsel (including
counsel for the Borrower or for any other party in interest), independent public
accountants and any other experts selected by it and shall not be liable to the
Lenders for any action taken or omitted to be taken in good faith by it in
accordance with the advice of such counsel, accountants or experts.
(b) The Issuing Bank shall have no duties or responsibilities except
those expressly set forth in this Agreement and in the other Loan Documents.
The duties of the Issuing Bank shall be mechanical and administrative in nature;
the Issuing Bank shall not by reason of this Agreement or the other Loan
Documents have a fiduciary relationship in respect of any Lender; and nothing in
this Agreement or any of the other Loan Documents, expressed or implied, is
intended to or shall be so construed as to impose upon the Issuing Bank any
obligations in respect of this Agreement or any other Loan Document (including
but not limited to the Letter of Credit Agreement, any Letter of Credit or
Letter of Credit Application) except as expressly set forth herein and therein.
Each Lender expressly acknowledges: (i) that the Issuing Bank has not made any
representations or warranties to it and that no act by the Issuing Bank
hereafter taken, including any review of the affairs of the Borrower, shall be
deemed to constitute any representation or warranty by the Issuing Bank to any
Lender; (ii) that it has made and will make its own independent investigation of
the financial condition and affairs, and its own appraisal of the
creditworthiness, of the Borrower, and its own evaluation of this Agreement and
the
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other Loan Documents; and (iii) that the Issuing Bank shall have no duty or
responsibility, either initially or on a continuing basis, to provide any Lender
with any credit or other information except as otherwise provided herein,
whether coming into its possession before the issuance of any Letter of Credit
hereunder or at any time or times thereafter, except for notices, reports or
other documents which this Agreement or another Loan Document expressly requires
to be furnished to the Lenders by the Issuing Bank hereunder or thereunder.
Without limitation, each Lender hereby acknowledges that the Issuing Bank has
not made, will not make and hereby expressly excludes any representations or
warranties concerning the execution, delivery, legality, validity or
enforceability of this Agreement or any of the other Loan Documents, or any
recital, representation, warranty, document, certificate, report or statement
made herein or in any of the other Loan Documents or made or furnished under or
in connection with this Agreement or any of the other Loan Documents.
(c) The Issuing Bank shall handle all matters concerning the Letters
of Credit in accordance with its usual practice in managing its own affairs in
the ordinary course of its business; but notwithstanding any other provision of
this Agreement, neither the Issuing Bank nor any of its directors, officers,
employees or agents shall be liable to any Lender for any action taken or
omitted to be taken by it or them hereunder or under any of the other Loan
Documents (including but not limited to the Letter of Credit Agreement, Letters
of Credit and Letter of Credit Applications) or in connection herewith or
therewith, unless caused by its or their own gross negligence or willful
misconduct. The Issuing Bank shall not in any circumstances (i) be responsible
in any manner to any of the Lenders for the execution, delivery, legality,
validity or enforceability of this Agreement or any of the other Loan Documents,
or for any recital, representation, warranty, document, certificate, report or
statement made herein or in any of the other Loan Documents or made or furnished
under or in connection with this Agreement or any of the other Loan Documents,
(ii) be under any obligation to any of the Lenders to ascertain or to inquire as
to the performance or observance of any of the terms, covenants or conditions in
this Agreement or any of the other Loan Documents on the part of the Borrower,
or the financial condition of the Borrower, or the existence or possible
existence of any Event of Default or Potential Default.
(d) The Issuing Bank shall not be under any obligation to any of the
Lenders to ascertain or to inquire as to the existence or possible existence of
any Event of Default or Potential Default, or to give notice of any such of
which it is aware.
(e) The Issuing Bank shall be entitled to rely upon any writing,
telegram, telex or teletype message, resolution, notice, consent, certificate,
letter, cablegram, statement, order or other document or conversation by
telephone or otherwise believed by it to be genuine and correct and to have been
signed, sent or made by the proper party or parties, and upon opinions of
counsel and other professional advisers selected by the Issuing Bank. The
Issuing Bank shall be fully justified in failing or refusing to take any action
hereunder unless 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.
(f) The Issuing Bank shall have the same rights and powers hereunder
as any other Lender and may exercise the same as though it were not the Issuing
Bank, and the terms "Lenders" or "holders of Notes" shall include the Issuing
Bank in its individual capacity. The Issuing Bank and its affiliates may,
without liability to account, make loans to, accept deposits from, act as
trustee under indentures of, and generally engage in any kind of banking or
trust business with, the Borrower and its Subsidiaries and their respective
stockholders and affiliates as though it were not acting as Issuing Bank
hereunder. The parties hereto intend that the Letter of Credit Participating
Interests represent commercial transactions, and not investments or securities
for purposes of any securities law.
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<PAGE>
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
------------------------------
The Borrower hereby represents and warrants to the Agent and each
Lender as follows:
4.01. Corporate Status. The Borrower and each Subsidiary of the
----------------
Borrower is a corporation duly organized, validly existing and, except as set
forth in Schedule 4.01 hereto with respect to non-domestic Subsidiaries, in good
standing under the laws of its jurisdiction of incorporation. The Borrower and
each Subsidiary of the Borrower has corporate power and authority to own its
property and to transact the business in which it is engaged or presently
proposes to engage. The Borrower and each Subsidiary of the Borrower is duly
qualified to do business as a foreign corporation and is in good standing in all
jurisdictions in which the ownership of its properties or the nature of its
activities or both makes such qualification necessary or advisable, except for
(x) matters set forth in Schedule 4.01 hereof, and (y) matters that,
individually or in the aggregate, could not have a Material Adverse Effect.
Schedule 4.01 hereof states as of the date hereof the jurisdiction of
incorporation of the Borrower and each Subsidiary of the Borrower, and the
jurisdictions in which the Borrower and each Subsidiary of the Borrower is
qualified to do business as a foreign corporation.
4.02. Corporate Power and Authorization. The Borrower and each
---------------------------------
Subsidiary of the Borrower has corporate power and authority to execute,
deliver, perform, and take all actions contemplated by, each Loan Document to
which it is a party, and all such action has been duly and validly authorized by
all necessary corporate proceedings on its part. Without limitation of the
foregoing, the Borrower has the corporate power and authority to borrow and
request Letters of Credit to be issued pursuant to the Loan Documents to the
fullest extent permitted hereby and thereby from time to time, and has taken all
necessary corporate action to authorize such borrowings and requests for
issuance of Letters of Credit.
4.03. Execution and Binding Effect. This Agreement and each other
----------------------------
Loan Document to which the Borrower or any Subsidiary of the Borrower is a party
and which is required to be delivered on or before the Closing Date pursuant to
Section 5.01 hereof has been duly and validly executed and delivered by the
Borrower or such Subsidiary, as the case may be. This Agreement and each such
other Loan Document constitutes, and each other Loan Document when executed and
delivered by the applicable Loan Party will constitute, the legal, valid and
binding obligation of each Loan Party which is a party hereto or thereto, as the
case may be, enforceable against the Borrower or such Subsidiary in accordance
with its terms, subject to applicable bankruptcy, insolvency and similar laws
affecting creditors' rights generally and subject, as to enforceability, to
general principles of equity (whether applied in a proceeding in equity or at
law).
4.04. Governmental Approvals and Filings. No approval, order,
----------------------------------
consent, authorization, certificate, license, permit or validation of, or
exemption or other action by, or filing, recording or registration with, or
notice to, any Governmental Authority (collectively, "Governmental Action") is
or will be necessary or advisable in connection with execution and delivery of
any Loan Document, consummation of the transactions herein or therein
contemplated, performance of or compliance with the terms and conditions hereof
or thereof or to ensure the legality, validity, binding effect, enforceability
or admissibility in evidence hereof or thereof, except for matters set forth in
Schedule 4.04 hereof. Each Governmental Action referred to in such Schedule
4.04 has been duly obtained or made, as the case may be, and is in full force
and effect, and there is no action, suit, proceeding or investigation pending or
(to the Borrower's knowledge after due inquiry) threatened which seeks or may
result in the reversal, rescission, termination, modification or suspension of
any such Governmental Action. No Governmental Action referred to in such
Schedule 4.04 requires any further act to be performed or condition to be
satisfied by any Person as a condition to continued effectiveness thereof,
except as set forth in such Schedule 4.04. With respect to the each of the
matters set forth in
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such Schedule 4.04 the Agent and each Lender has received a true, correct and
complete copy of (a) such Governmental Action (including each amendment,
modification or supplement thereto) and (b) all applications therefor and all
exhibits thereto.
4.05. Absence of Conflicts. Neither the execution and delivery of
--------------------
any Loan Document, nor consummation of the transactions herein or therein
contemplated, nor performance of or compliance with the terms and conditions
hereof or thereof does or will
(a) violate or conflict with any Law, or
(b) violate, conflict with or result in a breach of any term or
condition of, or constitute a default under, or result in (or give rise to
-- --
any right, contingent or otherwise, of any Person to cause) any
termination, cancellation, prepayment or acceleration of performance of, or
--
result in the creation or imposition of (or give rise to any obligation,
contingent or otherwise, to create or impose) any Lien upon any of property
of the Borrower or any Subsidiary of the Borrower pursuant to, or otherwise
--
result in (or give rise to any right, contingent or otherwise, of any
Person to cause) any change in any right, power, privilege, duty or
obligation of the Borrower or any Subsidiary of the Borrower under or in
connection with,
(i) the articles of incorporation or by-laws (or other
constituent documents) of the Borrower or any Subsidiary of the
Borrower,
(ii) any agreement or instrument creating, evidencing or securing
any Indebtedness or Guaranty Equivalent to which the Borrower or any
Subsidiary of the Borrower is a party or by which any of them or any
of their respective properties (now owned or hereafter acquired) may
be subject or bound, or
(iii) any other agreement or instrument or arrangement to which
the Borrower or any Subsidiary of the Borrower is a party or by which
any of them or any of their respective properties (now owned or
hereafter acquired) may be subject or bound,
except, in the case of the foregoing clause (b)(iii), for (x) matters set forth
in Schedule 4.05 hereof and (y) matters that, individually or in the aggregate,
could not have a Material Adverse Effect. Schedule 4.05 hereof sets forth each
consent, waiver, amendment or agreement which has been obtained by or on behalf
of the Borrower or any Subsidiary of the Borrower in respect of any matter which
would, absent such consent, waiver, amendment or agreement, be within the scope
of the foregoing clause (b), and the Agent and each Lender has received a true,
correct and complete copy of each such consent, waiver, amendment or agreement
and of each of the underlying agreements or instruments to which it relates.
4.06. Audited Financial Statements. The Borrower has heretofore
----------------------------
furnished to the Agent and each Lender consolidated balance sheets of the
Borrower and its consolidated Subsidiaries as of the last day of Fiscal Year
1993 and 1994 and the related consolidated statements of income, cash flows and
changes in stockholders' equity for such Fiscal Years then ended, as examined
and reported on by Deloitte & Touche LLP, independent certified public
accountants for the Borrower, who delivered an unqualified opinion in respect
thereof. Such financial statements (including the notes thereto) present fairly
the financial condition of the Borrower and its consolidated Subsidiaries as of
the end of each such Fiscal Year and the results of their operations and their
cash flows for the Fiscal Years then ended, all in conformity with GAAP.
4.07. Interim Financial Statements. The Borrower has heretofore
----------------------------
furnished to the Agent and each Lender interim consolidated balance sheets of
the Borrower and its consolidated Subsidiaries as of the end of the first fiscal
quarter of Fiscal Year 1995, together with the related consolidated statements
of income, cash flows and changes in stockholders' equity for the applicable
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fiscal periods ending on each such date. Such financial statements (including
the notes thereto) present fairly the financial condition of the Borrower and
its consolidated Subsidiaries as of the end of each such fiscal quarter and the
results of their operations and their cash flows for the fiscal periods then
ended, all in conformity with GAAP, subject to normal and recurring year-end
audit adjustments, and except that such financial statements do not contain all
of the footnote disclosures required by GAAP.
4.08. [Intentionally omitted].
4.09. Absence of Undisclosed Liabilities. Neither the Borrower nor
----------------------------------
any Subsidiary of the Borrower has any liability or obligation of any nature
whatever (whether absolute, accrued, contingent or otherwise, whether or not
due), forward or long-term commitments or unrealized or anticipated losses from
unfavorable commitments, except (w) as disclosed in the financial statements
referred to in Sections 4.06 and 4.07 hereof, (x) matters that, individually or
in the aggregate, could not have a Material Adverse Effect, (y) as disclosed in
Schedule 4.09 hereof and (z) liabilities, obligations, commitments and losses
incurred after the last day of Fiscal Year 1994 in the ordinary course of
business and consistent with past practices.
4.10. Absence of Material Adverse Changes. Except for the matters
-----------------------------------
set forth in Schedule 4.10 hereto, since the last day of Fiscal Year 1994 there
has been no material adverse change in the business, operations, condition
(financial or otherwise), or prospects of the Borrower and its Subsidiaries
taken as a whole.
4.11. Accurate and Complete Disclosure. All information heretofore,
--------------------------------
contemporaneously or hereafter provided (orally or in writing by an officer of
the Borrower) by or on behalf of the Borrower or any Subsidiary of the Borrower
to the Agent or any Lender pursuant to or in connection with any Loan Document
or any transaction contemplated hereby or thereby is or will be (as the case may
be) true and accurate in all material respects on the date as of which such
information is dated (or, if not dated, when received by the Agent or such
Lender, as the case may be) and does not or will not (as the case may be) omit
to state any material fact necessary to make such information not misleading at
such time in light of the circumstances in which it was provided. The Borrower
has disclosed to the Agent and each Lender in writing every fact or circumstance
known to the Borrower which has, or which could have so far as the Borrower can
now foresee is reasonably possible in the future and could if it occurs have, a
Material Adverse Effect.
4.12. [Intentionally omitted].
4.13. Projections. The Borrower has furnished to the Agent and each
-----------
Lender projections prepared by the Borrower demonstrating the projected
consolidated financial condition and results of operations of the Borrower and
its consolidated Subsidiaries after giving effect to the repayment of the Asset
Based Lending Facility and the other Indebtedness to be repaid in accordance
with Section 6.13 hereof, construction by the Borrower of a new distribution
facility near Erie, PA and Designated Stock Payments to be made by the Borrower
in 1995 to repurchase shares of the Borrower's common stock and the related
financing thereof (the "Pro Forma Activities), for the period commencing on the
first day of Fiscal Year 1995 and ending on the last day of Fiscal Year 2000
which projections are accompanied by a written statement of the assumptions and
estimates underlying such projections. Such projections were prepared on the
basis of such assumptions and estimates. Such projections, assumptions and
estimates, as of the date of preparation thereof and as of the date hereof, are
reasonable, are made in good faith, are consistent with the Loan Documents, and
represent the Borrower's best judgment as to such matters. Nothing has come to
the attention to the Borrower which would lead the Borrower to believe that such
projections will not be attained or exceeded. Nothing contained in this Section
shall constitute a representation or warranty that such future financial
performance or results of operations will in fact be achieved.
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4.14. Solvency. On and as of the Closing Date, after giving effect
--------
to all Loans and other obligations and liabilities being incurred on such date
in connection therewith, and on the date of each subsequent Loan or other Credit
Extension hereunder and after giving effect to application of the proceeds
thereof in accordance with the terms of the Loan Documents, the Borrower and
each Subsidiary of the Borrower is and will be Solvent.
4.15. Margin Regulations. No part of the proceeds of any Loan
------------------
hereunder will be used for the purpose of buying or carrying any "margin stock,"
as such term is used in Regulations G and U of the Board of Governors of the
Federal Reserve System, as amended from time to time, or to extend credit to
others for the purpose of buying or carrying any "margin stock." Neither any
Loan Party nor any Subsidiary of any Loan Party is engaged in the business of
extending credit to others for the purpose of buying or carrying "margin stock."
Neither the Borrower nor any Subsidiary of the Borrower owns any "margin stock."
Neither the making of any Loan nor any use of proceeds of any such Loan will
violate or conflict with the provisions of Regulation G, T, U or X of the Board
of Governors of the Federal Reserve System, as amended from time to time.
4.16. Subsidiaries. Schedule 4.16 hereof states as of the date of
------------
this Agreement the authorized capitalization of each Subsidiary of the Borrower,
the number of shares of each class of capital stock issued and outstanding of
each such Subsidiary, and the number and percentage of outstanding shares of
each such class of capital stock owned by the Borrower and by each such
Subsidiary. The outstanding shares of each Subsidiary of the Borrower have been
duly authorized and validly issued and are fully paid and nonassessable. The
Borrower and each Subsidiary of the Borrower owns beneficially and of record and
has good title to all of the shares it is listed as owning in such Schedule
4.16, free and clear of any Lien. There are no options, warrants, calls,
subscriptions, conversion rights, exchange rights, preemptive rights or other
rights, agreements or arrangements (contingent or otherwise) which may in any
circumstances now or hereafter obligate any Subsidiary to issue any shares of
its capital stock or any other securities except for matters set forth in
Schedule 4.16 hereof.
4.17. Partnerships, etc. Neither the Borrower nor any Subsidiary of
------------------
the Borrower is a partner (general or limited) of any partnership, is a party to
any joint venture or owns (beneficially or of record) any equity or similar
interest in any Person (including but not limited to any interest pursuant to
which such Loan Party or Subsidiary has or may in any circumstance have an
obligation to make capital contributions to, or be generally liable for or on
account of the liabilities, acts or omissions of such other Person), except for
(x) capital stock of Subsidiaries referred to in Section 4.16 hereof and (y)
matters set forth in Schedule 4.17 hereof.
4.18. Ownership and Control by Paul S. Bush. Schedule 4.18 sets
-------------------------------------
forth, as of the date of this Agreement, all shares of capital stock of the
Borrower beneficially owned by Paul S. Bush and the other members of the Control
Group.
4.19. Litigation. There is no pending or (to the Borrower's
----------
knowledge after due inquiry) threatened action, suit, proceeding or
investigation by or before any Governmental Authority or other Person against or
affecting the Borrower or any Subsidiary of the Borrower, except for (x) matters
set forth in Schedule 4.19 hereof, (y) matters described in the financial
statements referred to in Section 4.06 hereof and (z) matters that if adversely
decided, individually or in the aggregate, could not have a Material Adverse
Effect.
4.20. Absence of Events of Default. No event has occurred and is
----------------------------
continuing and no condition exists which constitutes an Event of Default or
Potential Default.
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4.21. Absence of Other Conflicts. Neither the Borrower nor any
--------------------------
Subsidiary of the Borrower is in violation of or conflict with, or is subject to
any contingent liability on account of any violation of or conflict with:
(a) any Law,
(b) its articles of incorporation or by-laws (or other constituent
documents), or
(c) any agreement or instrument or arrangement to which it is party or
by which it or any of its properties (now owned or hereafter acquired) may
be subject or bound,
except for (x) matters set forth in Schedule 4.21 hereof and (y) matters that,
individually or in the aggregate, could not have a Material Adverse Effect.
4.22. Insurance. The Borrower and each Subsidiary of the Borrower
---------
maintains with financially sound and reputable insurers not related to or
affiliated with the Borrower insurance with respect to its properties and
business and against at least such liabilities, casualties and contingencies and
in at least such types and amounts as is customary in the case of corporations
engaged in the same or a similar business or having similar properties similarly
situated. Schedule 4.22 hereof sets forth a list of all insurance currently
maintained by or in respect of the Borrower and each Subsidiary of the Borrower,
setting forth the identity of the insurance carrier, the type of coverage, the
amount of coverage and the deductible. There are no claims, actions, suits,
proceedings against, arising under or based upon any of such insurance policies
except as set forth in such Schedule 4.22.
4.23. Title to Property. The Borrower and each Subsidiary of the
-----------------
Borrower has good and marketable title in fee simple to all real property owned
or purported to be owned by it and good title to all other property of whatever
nature owned or purported to be owned by it, including but not limited to all
property reflected in the most recent audited balance sheet referred to in
Section 4.06 hereof or submitted pursuant to Section 6.01(a) hereof, as the case
may be (except as sold or otherwise disposed of in the ordinary course of
business after the date of such balance sheet), in each case free and clear of
all Liens, except for the Permitted Liens.
4.24. Intellectual Property. The Borrower and each Subsidiary of the
---------------------
Borrower owns, or is licensed or otherwise has the right to use, all the
patents, trademarks, service marks, names (trade, service, fictitious or
otherwise), copyrights, technology (including but not limited to computer
programs and software), processes, data bases and other rights, free from unduly
burdensome restrictions, necessary to own and operate its properties and to
carry on its business as presently conducted and presently planned to be
conducted without conflict with the rights of others.
4.25. Taxes. All tax and information returns required to be filed by
-----
or on behalf of the Borrower or each Subsidiary of the Borrower have been
properly prepared, executed and filed. All taxes, assessments, fees and other
governmental charges upon the Borrower or each Subsidiary of the Borrower or
upon any of their respective properties, incomes, sales or franchises which are
due and payable have been paid other than those not yet delinquent and payable
without premium or penalty, and except for those being diligently contested in
good faith by appropriate proceedings, and in each case adequate reserves and
provisions for taxes have been made on the books of the Borrower and each
Subsidiary of the Borrower. The reserves and provisions for taxes on the books
of the Borrower and each Subsidiary of the Borrower are adequate for all open
years and for its current fiscal period. Neither the Borrower nor any
Subsidiary of the Borrower knows of any proposed additional assessment or basis
for any material assessment for additional taxes (whether or not reserved
against). The federal, state, local and foreign income tax liabilities of the
Borrower and each of its Subsidiaries have been finally determined by the
Internal Revenue Service and other relevant taxing authorities, or the time for
audit has expired, for all fiscal periods ending on or prior to the last day of
Fiscal Year 1991 and all
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such liabilities (including all deficiencies assessed following audit) have been
satisfied. Neither the Borrower nor any Subsidiary of the Borrower has at any
time filed a consolidated tax return with any Person other than the Borrower and
its Subsidiaries, except as set forth in Schedule 4.25 hereto. Schedule 4.25
hereof describes all tax sharing arrangements or agreements to which the
Borrower or any Subsidiary of the Borrower is subject or bound.
4.26. Employee Benefits. A copy of the most recent Annual Report
-----------------
(5500 Series Form) including all attachments thereto as filed with the Internal
Revenue Service for each Plan has been provided to Agent and each Lender and
fairly presents the funding status of each Plan. There has been no material
deterioration in any Plan's funding status since the date of such Annual Report.
Schedule 4.26 hereof sets forth as of the date hereof a list of all Plans and
Multiemployer Plans, and all information available to the Borrower with respect
to the direct, indirect or potential withdrawal liability to any Multiemployer
Plan of any Loan Party or any Controlled Group Member. Except as set forth in
Schedule 4.26 hereof, neither the Borrower nor any Subsidiary of the Borrower
has any liability (contingent or otherwise) for or in connection with, and none
of their respective properties is subject to a Lien in connection with, any
Pension-Related Event. Neither the Borrower nor any Subsidiary of the Borrower
has any liability (contingent or otherwise) for or in connection with, any
Postretirement Benefits. The PBGC premiums and contributions required to meet
the minimum funding requirements of ERISA and the Code for all Plans have not
exceeded $25,000 on an annual basis for any of the past three years. The amount
of unfunded benefit liabilities (as defined in Section 4001(a)(16) of ERISA), as
certified to by the Plan's actuary, for any Plan do not exceed $25,000 and for
all Plans do not exceed $25,000 .
4.27. Environmental Matters.
---------------------
(a) The Borrower and each Subsidiary of the Borrower and each of
their respective Environmental Affiliates is and has been in full compliance
with all applicable Environmental Laws, except for (x) matters set forth in
Schedule 4.27 hereof and (y) matters which, individually or in the aggregate,
could not have a Material Adverse Effect. There are to the Borrower's knowledge
after due inquiry no circumstances that may prevent or interfere with such full
compliance in the future.
(b) The Borrower and each Subsidiary of the Borrower and their
respective Environmental Affiliates have all Environmental Approvals necessary
or desirable for the ownership and operation of their respective properties,
facilities and businesses as presently owned and operated and as presently
proposed to be owned and operated, except for (x) matters set forth in Schedule
4.27 hereof and (y) matters which, individually or in the aggregate, could not
have a Material Adverse Effect.
(c) There is no Environmental Claim pending or to the knowledge of
the Borrower after due inquiry threatened, and there are no past or present
acts, omissions, events or circumstances (including but not limited to any
dumping, leaching, deposition, removal, abandonment, escape, emission, discharge
or release of any Environmental Concern Material at, on or under any facility or
property now or previously owned, operated or leased by the Borrower or any
Subsidiary of the Borrower or any of their respective Environmental Affiliates)
that could form the basis of any Environmental Claim, against the Borrower or
any Subsidiary of the Borrower or any of their respective Environmental
Affiliates, except for (x) matters set forth in Schedule 4.27 hereof, and (y)
matters which, if adversely decided, individually or in the aggregate, could not
have a Material Adverse Effect.
(d) Except for matters set forth in Schedule 4.27 hereto, no facility
or property now or previously owned, operated or leased by the Borrower or
Subsidiary of the Borrower or any of their respective Environmental Affiliates
is an Environmental Cleanup Site. Neither the Borrower nor any Subsidiary of
the Borrower nor any of their respective Environmental Affiliates has directly
transported or directly arranged for the transportation of any Environmental
Concern Materials to any Environmental Cleanup Site. No Lien exists, and no
condition exists which could result in the filing of
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a Lien, against any property of the Borrower or any Subsidiary of the Borrower
or any of their respective Environmental Affiliates, under any Environmental
Law.
4.28. Regulatory Restrictions. Neither the Borrower nor any
-----------------------
Subsidiary of the Borrower is (a) an "investment company" or a company
"controlled" by an investment company within the meaning of the Investment
Company Act of 1940, as amended, (b) a "holding company" or a "subsidiary
company" of a "holding Company" or an "affiliate" of either a "holding company"
or a "subsidiary company" within the meaning of the Public Utility Holding
Company Act of 1935, as amended, (c) subject to regulation under the Federal
Power Act, the Interstate Commerce Act, or the Investment Company Act of 1940,
as amended, or (d) subject to any other Law which purports to restrict or
regulate its ability to borrow money or obtain credit.
ARTICLE V
CONDITIONS OF CREDIT EXTENSIONS
-------------------------------
5.01. Conditions to Initial Credit Extension. The obligation of each
--------------------------------------
Lender to make Loans on the Closing Date and the willingness of the Issuing Bank
to issue any Letter of Credit on the Closing Date is subject to the
satisfaction, immediately prior to or concurrently with the making of such Loan
or issuance of such Letter of Credit, of the following conditions precedent, in
addition to the conditions precedent set forth in Section 5.02 hereof:
(a) Agreement; Notes; Schedules; Letter of Credit Agreement. The
-------------------------------------------------------
Agent shall have received an executed counterpart of this Agreement for
each Lender, duly executed by the Borrower, and executed Revolving Credit
Notes conforming to the requirements hereof, duly executed on behalf of the
Borrower. The Schedules attached hereto shall be approved by the Agent and
each of the Lenders. The Agent shall have received an executed counterpart
of the Letter of Credit Agreement in the form attached as Exhibit B-3
hereto (the "Letter of Credit Application") for the Issuing Bank, duly
executed by the Borrower.
(b) Governmental Approvals and Filings. The Agent shall have
----------------------------------
received, with copies and executed counterparts for each Lender, true and
correct copies (in each case certified as to authenticity on such date on
behalf of the Borrower) of all items referred to in Schedule 4.04 hereof
and such items shall be satisfactory in form and substance to the Agent and
each Lender and shall be in full force and effect.
(c) Other Conflicts. The Agent shall have received, with copies and
---------------
executed counterparts for each Lender, true and correct copies (in each
case certified as to authenticity on such date on behalf of the Borrower)
of all items referred to in Schedule 4.05 hereof and such items shall be
satisfactory in form and substance to the Agent and each Lender and shall
be in full force and effect.
(d) Corporate Proceedings. The Agent shall have received, with a
---------------------
counterpart for each Lender, certificates by the Secretary or Assistant
Secretary of the Borrower dated as of the Closing Date as to (i) true
copies of the articles of incorporation and by-laws (or other constituent
documents) of the Borrower in effect on such date (which, in the case of
articles of incorporation or other constituent documents filed or required
to be filed with the Secretary of State or other Governmental Authority in
its jurisdiction of incorporation, shall be certified to be true, correct
and complete by such Secretary of State or other Governmental Authority not
more than 30 days before the Closing Date), (ii) true copies of all
corporate action taken by the Borrower relative to this Agreement and the
other Loan Documents and (iii) the incumbency and signature of the officers
of the Borrower executing this Agreement and the other Loan Documents,
together with satisfactory evidence of the incumbency of such Secretary or
Assistant
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<PAGE>
Secretary. The Agent shall have received, with a copy for each
Lender, certificates from the appropriate Secretaries of State or other
applicable Governmental Authorities dated not more than 30 days before the
Closing Date showing the good standing of the Borrower in its state of
incorporation and each state in which the Borrower is qualified to do
business as described in Schedule 4.01.
(e) Financial Statements, Projections. The Agent shall have
---------------------------------
received, with a counterpart for each Lender, copies of the consolidated
financial statements and projections referred to in Sections 4.06, 4.07 and
4.13 hereof. The assumptions reflected in such projections shall be
reasonably acceptable to the Agent and the Lenders.
(f) Legal Opinion of Counsel to the Borrower. The Agent shall have
----------------------------------------
received, with an executed counterpart for each Lender, an opinion
addressed to the Agent and each Lender, dated the Closing Date, of Broad &
Cassel, counsel to each of the Borrower, in substantially the form attached
hereto as Exhibit C.
(g) Officers' Certificates. The Agent shall have received, with an
----------------------
executed counterpart for each Lender, certificates from such officers of
each Loan Party as to such matters as the Agent or any Lender may request.
(h) Fees, Expenses, etc. All fees and other compensation required to
-------------------
be paid to the Agent or the Lenders pursuant hereto or pursuant to any
other written agreement on or prior to the Closing Date shall have been
paid or received.
(i) Termination and Repayment of Asset Based Lending Facility and
-------------------------------------------------------------
Release of Liens Relating Thereto. The Agent shall have received evidence
---------------------------------
satisfactory to it of the termination of the Asset Based Lending Facility,
the repayment (or waiver) of all principal, interest, letter of credit
draws, premiums, fees, termination payments, prepayment penalties and other
amounts outstanding or otherwise due and payable thereunder, the discharge
of all the obligations of the Borrower and its Subsidiaries thereunder, the
release and satisfaction of all the Liens securing the Asset Based Lending
Facility (it being acknowledged that, for purposes of this Agreement, the
Asset Based Lending Facility does not include the IDA Facility). Without
limitation of the foregoing, the Agent shall have received a payoff letter
substantially in the form attached hereto as Exhibit G.
(j) Lien Searches. The Agent shall have received contemporaneous
-------------
searches of Uniform Commercial Code, real estate, tax, patent and trademark
and other appropriate registers, dockets, offices and records, which shall
have revealed no filings or recordings evidencing or relating to any Liens
with respect to any property of the Borrower or any of its Subsidiaries
(other than filings or recordings relating to Liens securing the
obligations of the Borrower and its Subsidiaries under the Asset Based
Lending Facility, which Liens shall be released on the Closing Date, and
Permitted Liens).
(k) No Litigation. There shall not be pending or (to the knowledge
-------------
of the Borrower after due inquiry) threatened any action, suit, proceeding
or investigation by or before any Governmental Authority or other Person
seeking to challenge, prevent, enjoin or declare illegal the transactions
contemplated hereby.
(l) No Material Adverse Change. There shall not have occurred, or be
--------------------------
threatened, a material adverse change in the business, operations, assets
or condition (financial or otherwise) or prospects of the Borrower and its
Subsidiaries taken as a whole since April 1, 1995.
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<PAGE>
(m) Additional Matters. The Agent shall have received such other
------------------
certificates, opinions, documents and instruments as may be reasonably
requested by any Lender. All corporate and other proceedings, and all
documents, instruments and other matters in connection with the
transactions contemplated by this Agreement and the other Loan Documents
shall be satisfactory in form and substance to the Agent and each Lender.
5.02. Conditions to All Credit Extensions. The obligation of each
-----------------------------------
Lender to make any Loan and the willingness of the Issuing Bank to issue any
Letter of Credit is subject to performance by each of the Loan Parties of their
respective obligations to be performed hereunder or under the other Loan
Documents on or before the date of such Loan or such Letter of Credit,
satisfaction of the conditions precedent set forth herein and in the other Loan
Documents and to satisfaction of the following further conditions precedent:
(a) Notice. Appropriate notice of such Loan or Letter of Credit
------
shall have been given by the Borrower as provided in Article II or Article
III hereof, as the case may be.
(b) Representations and Warranties. Each of the representations and
------------------------------
warranties made by the Borrower in Article IV hereof shall be true and
correct in all material respects on and as of such date as if made on and
as of such date, both before and after giving effect to the Loans requested
to be made and Letters of Credit requested to be issued on such date,
except to the extent that any such representation or warranty (including
any Schedule referred to therein) relates solely and specifically to a
prior date and except to the extent that any such representation and
warranty (including any Schedule referred to therein) is not true and
correct in any material respect solely and specifically as a result of
activities or actions expressly permitted to be taken by the Borrower or
any of its Subsidiaries pursuant to Article VII hereof.
(c) No Defaults. No Event of Default or Potential Default shall have
-----------
occurred and be continuing on such date or after giving effect to the Loans
requested to be made or the Letters of Credit requested to be issued on
such date.
(d) No Violations of Law, etc. Neither the making nor use of the
-------------------------
Loans or the Letters of Credit shall cause any Lender to violate or
conflict with any Law.
(e) No Material Adverse Change. There shall not have occurred, or be
--------------------------
threatened, a material adverse change in the business, operations, assets
or condition (financial or otherwise) or prospects of the Borrower and its
Subsidiaries taken as a whole since the Closing Date. There shall not have
occurred, or be threatened, any other event, act or condition which could
have a Material Adverse Effect.
Each request by the Borrower for any Loan or Letter of Credit shall constitute a
representation and warranty by the Borrower that the conditions set forth in
this Section 5.02 have been satisfied as of the date of such request. Failure
of the Agent to receive notice from the Borrower to the contrary before such
Loan is made or such Letter of Credit is issued shall constitute a further
representation and warranty by the Borrower that the conditions referred to in
this Section 5.02 have been satisfied as of the date such Loan is made or such
Letter of Credit is issued.
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<PAGE>
ARTICLE VI
AFFIRMATIVE COVENANTS
---------------------
The Borrower hereby covenants to the Agent and each Lender as follows:
6.01. Basic Reporting Requirements.
----------------------------
(a) Annual Audit Reports. As soon as practicable, and in any event
--------------------
within 90 days after the close of each Fiscal Year of the Borrower, the Borrower
shall furnish to the Agent, with a copy for each Lender, consolidated statements
of income, cash flows and changes in stockholders' equity of the Borrower and
its consolidated Subsidiaries for such Fiscal Year and a consolidated balance
sheet of the Borrower and its consolidated Subsidiaries as of the close of such
Fiscal Year, and notes to each, all in reasonable detail, setting forth in
comparative form the corresponding figures for the preceding Fiscal Year. Such
financial statements shall be accompanied by an opinion of independent certified
public accountants of recognized national standing selected by the Borrower and
reasonably satisfactory to the Required Lenders. Such opinion shall be free of
exceptions or qualifications not acceptable to the Required Lenders and in any
event shall be free of any exception or qualification which is of "going
concern" or like nature. Such opinion in any event shall contain a written
statement of such accountants substantially to the effect that (i) such
accountants examined such financial statements in accordance with generally
accepted auditing standards and accordingly made such tests of accounting
records and such other auditing procedures as such accountants considered
necessary in the circumstances and (ii) in the opinion of such accountants such
financial statements present fairly the financial position of the Borrower and
its consolidated Subsidiaries as of the end of such Fiscal Year and the results
of their operations and their cash flows and changes in stockholders' equity for
such Fiscal Year, in conformity with GAAP.
(b) Quarterly Consolidated Reports. As soon as practicable, and in
------------------------------
any event within 45 days after the close of each of the first three fiscal
quarters of each Fiscal Year of the Borrower, the Borrower shall furnish to the
Agent, with a copy for each Lender, unaudited consolidated statements of income
and cash flows of the Borrower and its consolidated Subsidiaries for such fiscal
quarter and for the period from the beginning of such Fiscal Year to the end of
such fiscal quarter and an unaudited consolidated balance sheet of the Borrower
and its consolidated Subsidiaries as of the close of such fiscal quarter, and
notes to each, all in reasonable detail, setting forth in comparative form the
corresponding figures for the same periods or as of the same date during the
preceding Fiscal Year (except for the consolidated balance sheet, which shall
set forth in comparative form the corresponding balance sheet as of the prior
Fiscal Year end). Such financial statements shall be certified by a Responsible
Officer of the Borrower as presenting fairly the financial position of the
Borrower and its consolidated Subsidiaries as of the end of such fiscal quarter
and the results of their operations and their cash flows for such fiscal
quarter, in conformity with GAAP, subject to normal and recurring year-end audit
adjustments.
(c) Consolidating Reports. If and to the extent that there are any
---------------------
Significant Subsidiaries of the Borrower, as soon as practicable, and in any
event within 45 days after the close of each of the first three fiscal quarters
of each Fiscal Year of the Borrower and 90 days after the close of each Fiscal
Year of the Borrower, the Borrower shall furnish to the Agent, with a copy for
each Lender, unaudited consolidating statements of income of the Borrower which
include each such Significant Subsidiary for such fiscal quarter or Fiscal Year,
as the case may be, and unaudited consolidating balance sheets of the Borrower
which include each such Significant Subsidiary as of the close of such fiscal
quarter or Fiscal Year, as the case may be, all in reasonable detail as shall be
reasonably requested by any Lender. Such statements shall be certified by a
Responsible Officer of the Borrower as presenting fairly the financial position
of each such Significant Subsidiary as of the end of such fiscal quarter or
Fiscal Year, as the case may be, and the results of their operations for such
fiscal quarter or Fiscal Year, as the case may be, in conformity with GAAP
(exclusive of principles of consolidation), subject (in the case of quarterly
reports) to normal and recurring year-end audit adjustments.
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<PAGE>
(d) Quarterly Compliance Certificates. The Borrower shall deliver to
---------------------------------
the Agent, with a copy for each Lender, a Quarterly Compliance Certificate in
substantially the form set forth as Exhibit D hereto, duly completed and signed
by a Responsible Officer of the Borrower concurrently with the delivery of the
financial statements referred to in subsections (a), (b) and (c) (if applicable)
of this Section 6.01.
(e) Accountants' Certificate. Each set of financial statements
------------------------
delivered pursuant to Section 6.01(a) hereof shall be accompanied by a
certificate or report dated the date of such statements and balance sheet by the
independent certified public accountants who opined on such financial statements
stating in substance that they have reviewed this Agreement and that in making
the examination necessary for their certification of such statements and balance
sheet they did not become aware of any Event of Default or Potential Default, or
if they did become so aware, such certificate or report shall state the nature
and period of existence thereof.
(f) Projections.
-----------
(i) On the Closing Date (with respect to the then-current current
Fiscal Year of the Borrower), and as soon as practicable and in any event
not later than March 31 of each subsequent Fiscal Year of the Borrower, the
Borrower shall furnish to the Agent, with a copy for each Lender, a
certificate signed by a Responsible Officer on behalf of the Borrower
containing a consolidated projection of the revenues, expenditures (capital
or otherwise) and results of operations and cash position of the Borrower
and its Subsidiaries as of the end of each quarter in the forthcoming
Fiscal Year, together with a statement of the assumptions and estimates
upon which such projections are based. Such projections, estimates and
assumptions, as of the date of preparation thereof, shall be reasonable,
made in good faith, shall be consistent with the Loan Documents, and shall
represent the Borrower's best judgment as to such matters.
(ii) Concurrently with the delivery of the financial reports referred
to in Section 6.01(a) hereof, the Borrower shall furnish to the Agent, with
a copy for each Lender, a comparison of the Borrower's actual results for
the most recent Fiscal Year compared to the most recent projections
provided by the Borrower for such Fiscal Year pursuant to Section
6.01(f)(i) hereof, together with a brief explanation of the basis for any
material differences (positive or negative) between the Borrower's actual
results and such projections.
(g) Certain Other Reports and Information. Promptly upon their
-------------------------------------
becoming available to the Borrower, the Borrower shall deliver to the Agent,
with a copy for each Lender, a copy of (i) all regular or special reports,
registration statements and amendments to the foregoing which the Borrower or
any Subsidiary shall file with the Securities and Exchange Commission (or any
successor thereto) or any securities exchange, (ii) all reports, proxy
statements, financial statements and other information distributed by the
Borrower to its stockholders, bondholders or the financial community generally
and (iii) all accountants' management letters (if any) pertaining to, all other
reports submitted by accountants in connection with any audit of, and all other
material reports from outside accountants with respect to, the Borrower or any
of its Subsidiaries.
(h) Further Information. The Borrower will promptly furnish to the
-------------------
Agent, with a copy for each Lender, such other information and in such form as
the Agent or any Lender may reasonably request from time to time.
(i) Notice of Certain Events. Promptly upon becoming aware of any of
------------------------
the following, the Borrower shall give the Agent notice thereof, together with a
written statement of a Responsible Officer of the Borrower setting forth the
details thereof and any action with respect thereto taken or proposed to be
taken by the Borrower:
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<PAGE>
(i) Any Event of Default or Potential Default.
(ii) Any material adverse change in the business, operations or
condition (financial or otherwise) or prospects of the Borrower and its
Subsidiaries taken as a whole.
(iii) Any pending or threatened action, suit, proceeding or
investigation by or before any Governmental Authority against or affecting
any Loan Party or any Subsidiary of any Loan Party, except for matters that
if adversely decided, individually or in the aggregate, could not have a
Material Adverse Effect.
(iv) Any material violation, breach or default by the Borrower or any
Subsidiary of the Borrower or by any other Person of or under any agreement
or instrument material to the business, operations, condition (financial or
otherwise) or prospects of the Borrower and its Subsidiaries taken as a
whole.
(v) Any material amendment or supplement to, or extension, renewal,
refinancing, or refunding of, or waiver by any other party thereto of any
right under or conditions of, any agreement or instrument creating,
evidencing or securing any Indebtedness or Guaranty Equivalent of the
Borrower or any Subsidiary or any agreement or instrument material to the
business, operations, condition (financial or otherwise) or prospects of
the Borrower and its Subsidiaries taken as a whole, and any substantive
negotiations pertaining to any of the foregoing.
(vi) Any Pension-Related Event. Such notice shall be accompanied by:
(A) a copy of any notice, request, return, petition or other document
received by the Borrower, any Subsidiary of the Borrower or any Controlled
Group Member from any Person, or which has been or is to be filed with or
provided to any Person (including without limitation the Internal Revenue
Service, PBGC or any Plan participant, beneficiary, alternate payee or
employer representative), in connection with such Pension-Related Event,
and (B) in the case of any Pension-Related Event with respect to a Plan,
the most recent Annual Report (5500 Series), with attachments thereto, and
the most recent actuarial valuation report, for such Plan.
(vii) Any Environmental Claim pending or threatened against the
Borrower or any Subsidiary of the Borrower or any of their respective
Environmental Affiliates, or any past or present acts, omissions, events or
circumstances (including but not limited to any dumping, leaching,
deposition, removal, abandonment, escape, emission, discharge or release of
any Environmental Concern Material at, on or under any facility or property
now or previously owned, operated or leased by the Borrower or any
Subsidiary of the Borrower or any of their respective Environmental
Affiliates) that could form the basis of such Environmental Claim, which
Environmental Claim, if adversely resolved, individually or in the
aggregate, could have a Material Adverse Effect.
(j) Notices Under Other Agreements. Concurrently with the Borrower's
------------------------------
or a Subsidiary's delivery or receipt thereof, the Borrower shall provide the
Agent with copies of any material reports, certificates or notices furnished by
the Borrower or a Subsidiary to any other party to any agreement or instrument
creating, evidencing or securing any Indebtedness or Guaranty Equivalent of the
Borrower or any Subsidiary of the Borrower or any agreement or instrument
material to the business, operations, condition (financial or otherwise) or
prospects of the Borrower and its Subsidiaries taken as a whole or received by
the Borrower or a Subsidiary from any other party to any of the foregoing.
(k) Visitation; Verification. The Borrower shall permit such Persons
------------------------
as the Agent or any Lender may designate from time to time to visit and inspect
any of the properties of the Borrower
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<PAGE>
and of any Subsidiary, to examine their respective books and records and take
copies and extracts therefrom and to discuss their respective affairs with their
respective directors, officers, employees and independent accountants at such
times and as often as the Agent or any Lender may reasonably request. The
Borrower hereby authorizes such officers, employees and independent accountants
to discuss with the Agent or any Lender the affairs of the Borrower and its
Subsidiaries. The Agent and the Lenders shall have the right to examine and
verify accounts, inventory and other properties and liabilities of the Borrower
and its Subsidiaries from time to time, and the Borrower shall cooperate, and
shall cause each Subsidiary to cooperate, with the Agent and the Lenders in such
verification.
6.02. Insurance. The Borrower shall, and shall cause each Subsidiary
---------
to, (a) maintain with financially sound and reputable insurers insurance with
respect to its properties and business and against such liabilities, casualties
and contingencies and of such types and in such amounts as is reasonably
satisfactory from time to time to the Required Lenders, which insurance shall in
any event not provide for a materially lower level of coverage than the
insurance referred to in Section 4.22 hereof, (b) provide that such insurance
cannot terminate, expire, be cancelled or amended in any material respect
without 30 days' prior notice to the Agent, (c) furnish to each Lender from time
to time upon request the policies under which such insurance is issued,
certificates of insurance and such other information relating to such insurance
as such Lender may reasonably request, and (d) provide such other insurance and
endorsements as are required by this Agreement and the other Loan Documents.
6.03. Payment of Taxes and Other Potential Charges and Priority
------------------------------------------------ --------
Claims. The Borrower shall, and shall cause each Subsidiary to, pay or
- ------
discharge
(a) on or prior to the date on which penalties attach thereto, all
taxes, assessments and other governmental charges imposed upon it or any of
its properties;
(b) on or prior to the date when due, all lawful claims of
materialmen, mechanics, carriers, warehousemen, landlords and other like
Persons which, if unpaid, might result in the creation of a Lien upon any
such property; and
(c) on or prior to the date when due, all other lawful claims which,
if unpaid, might result in the creation of a Lien upon any such property or
which, if unpaid, might give rise to a claim entitled to priority over
general creditors of the Borrower or such Subsidiary in a case under Title
11 (Bankruptcy) of the United States Code, as amended;
provided, that unless and until foreclosure, distraint, levy, sale or similar
- --------
proceedings shall have been commenced the Borrower or such Subsidiary need not
pay or discharge any such tax, assessment, charge or claim so long as (x) the
validity thereof is contested in good faith and by appropriate proceedings
diligently conducted and (y) such reserves or other appropriate provisions as
may be required by GAAP shall have been made therefor or appropriate indemnities
or bonds shall have been obtained with respect thereto.
6.04. Preservation of Corporate Status. The Borrower shall, and
--------------------------------
shall cause each of its Subsidiaries to, maintain its status as a corporation
duly organized, validly existing and in good standing under the laws of its
jurisdiction of incorporation, and to be duly qualified to do business as a
foreign corporation and in good standing in all jurisdictions in which the
ownership of its properties or the nature of its business or both make such
qualification necessary or advisable, except for (i) matters that, individually
or in the aggregate, could not have a Material Adverse Effect and (ii) matters
permitted by Section 7.09 hereof.
6.05. Governmental Approvals and Filings. The Borrower shall, and
----------------------------------
shall cause each Subsidiary to, keep and maintain in full force and effect all
Governmental Actions necessary or advisable in connection with execution and
delivery of any Loan Document, consummation of the
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<PAGE>
transactions hereon or therein contemplated, performance of or compliance with
the terms and conditions hereof or thereof or to ensure the legality, validity,
binding effect or enforceability hereof or thereof.
6.06. Maintenance of Properties, Franchises, Etc. The Borrower
-------------------------------------------
shall, and shall cause each Subsidiary to, (a) maintain or cause to be
maintained in good repair, working order and condition the properties now or
hereafter owned, leased or otherwise possessed by it and shall make or cause to
be made all needful and proper repairs, renewals, replacements and improvements
thereto so that the business carried on in connection therewith may be properly
and advantageously conducted at all times, except where a failure to do so could
not have a Material Adverse Effect, and (b) maintain and hold in full force and
effect all franchises, licenses, permits, certificates, authorizations,
qualifications, accreditations and other rights, consents and approvals (whether
issued, made or given by a Governmental Authority or otherwise) necessary to own
and operate its properties and to carry on its business or presently conducted
and as presently planned to be conducted, except where failure to do so could
not have a Material Adverse Effect.
6.07. Avoidance of Other Conflicts. The Borrower shall not, and
----------------------------
shall not permit any of its Subsidiaries to, violate or conflict with, be in
violation of or conflict with, or be or remain subject to any liability
(contingent or otherwise) on account of any violation or conflict with
(a) any Law,
(b) its articles of incorporation of by-laws (or other constituent
documents), or
(c) any agreement or instrument to which it is party or by which any
of them or any of their respective Subsidiaries is a party or by which any
of them or any of their respective properties (now owned or hereafter
acquired) may be subject or bound,
except for (x) matters set forth in Schedule 4.21 hereof and (y) matters that
could not, individually or in the aggregate, have a Material Adverse Effect.
6.08. Financial Accounting Practices. The Borrower shall make and
------------------------------
keep books, records and accounts which, in reasonable detail, accurately and
fairly reflect its transactions and dispositions of its assets and maintain a
system of internal accounting controls sufficient to provide reasonable
assurances that (a) transactions are executed in accordance with management's
general or specific authorization, (b) transactions are recorded as necessary
(i) to permit preparation of financial statements in conformity with GAAP and
any other accounting principles applicable thereto and (ii) to maintain
accountability for assets, (c) access to assets is permitted only in accordance
with management's general or specific authorization and (d) the recorded
accountability for assets is compared with the existing assets at reasonable
intervals and appropriate action is taken with respect to any differences. The
Borrower shall cause each of its Subsidiaries to make and keep books, records
and accounts which, in reasonable detail, permit the Borrower to prepare
consolidated financial statements in conformity with GAAP.
6.09. Use of Proceeds. The Borrower shall apply the proceeds of all
---------------
Loans hereunder only for the following purposes: (a) all Loans incurred on the
Closing Date shall be applied to repay in full all amounts outstanding under the
Asset Based Lending Facility and under the Indebtedness set forth on Schedule
6.13 hereto and (b) after the Closing Date, Loans shall be used to provide
working capital financing and for other general corporate purposes of the
Borrower. The Borrower shall not use the proceeds of any Loans hereunder
directly or indirectly for any unlawful purpose, in any manner inconsistent with
Section 4.15 hereof, or inconsistent with any other provision of any Loan
Document. All Letters of Credit shall be used for the purposes permitted by
Section 3.01(c) hereof.
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<PAGE>
6.10. Continuation of or Change in Business. The Borrower and each
-------------------------------------
of its Subsidiaries shall continue to engage in its business substantially as
conducted and operated during the present and preceding Fiscal Year, and the
Borrower shall not, and shall not permit any Subsidiary to, engage in any
unrelated business, except for matters permitted by Sections 7.09(a), (b) and
(e) hereof.
6.11. Consolidated Tax Return. The Borrower shall not, and shall not
-----------------------
suffer any of its Subsidiaries to, file or consent to the filing of any
consolidated income tax return with any Person other than the Borrower and its
Subsidiaries, except with respect to (i) the transaction permitted by Sections
7.09(a), (b) and (e) hereof and (ii) matters disclosed on Schedule 4.25 hereto.
6.12. Significant Subsidiary Guaranty. Promptly upon any Person
-------------------------------
being or becoming a Significant Subsidiary of the Borrower, the Borrower shall
forthwith cause such Significant Subsidiary to execute and deliver to the Agent
counterparts of a Significant Subsidiary Guaranty, together with a certificate
by the Secretary or an Assistant Secretary of such Significant Subsidiary dated
the date of such Significant Subsidiary Guaranty as to (i) a true copy of the
articles of incorporation and by-laws (or other constituent document) of such
Significant Subsidiary in effect on such date, (ii) a true copy of all corporate
action taken by such Significant Subsidiary relative to the execution and
delivery of such Significant Subsidiary Guaranty and (iii) the incumbency and
signature of the officers of such Significant Subsidiary executing such
Significant Subsidiary Guaranty, together with satisfactory evidence of the
incumbency of such Secretary or Assistant Secretary.
6.13. Repayment of Certain Indebtedness. On or before September 30,
---------------------------------
1995, the Borrower shall repay all principal, interest, premiums, fees,
termination payments, prepayment penalties and other amounts outstanding or
otherwise due and payable under or with respect to the Indebtedness set forth on
Schedule 6.13 hereto. On or before October 31, 1995, the Borrower shall cause
to be released of record all Liens securing the Indebtedness set forth on
Schedule 6.13 hereto. On or before November 30, 1995, the Borrower shall
provide to the Agent lien searches or other evidence reasonably satisfactory to
the Agent demonstrating release of all the Liens required to be released
pursuant to Section 5.01(i) hereof and this Section 6.13.
ARTICLE VII
NEGATIVE COVENANTS
------------------
The Borrower hereby covenants to the Agent and each Lender as follows:
7.01. Financial Covenants.
-------------------
(a) Ratio of Consolidated Funded Debt (Net) to Consolidated Net Worth.
-----------------------------------------------------------------
As of the last day of each fiscal quarter of each Fiscal Year, the ratio
of Consolidated Funded Debt (Net) as of the end of such fiscal quarter to
Consolidated Net Worth as of the end of such fiscal quarter shall be not more
than 0.49 to 1.00.
(b) Ratio of Consolidated Funded Debt (Net) to Consolidated EBIT. As
------------------------------------------------------------
of the last day of each fiscal quarter of each Fiscal Year, the ratio of
Consolidated Funded Debt (Net) as of the end of such fiscal quarter to
Consolidated EBIT for the period of four fiscal quarters ending on such day,
considered as a single accounting period, shall not be more than 3.00 to 1.00.
(c) Consolidated Tangible Net Worth. As of the last day of Fiscal
-------------------------------
Year 1995, Consolidated Tangible Net Worth for Fiscal Year 1995 shall not be
less than an amount equal to (i) Consolidated Tangible Net Worth for Fiscal Year
1994 minus (ii) the amount of all Designated Stock Purchases made during Fiscal
-----
Year 1995 plus (iii) 50% of Consolidated Net Income for Fiscal Year 1995. For
----
each Fiscal Year after Fiscal Year 1995 (the "Test Year"), as of the last day of
such Test
-51-
<PAGE>
Year, Consolidated Tangible Net Worth for the Test Year shall not be less than
an amount equal to (i) the minimum Consolidated Tangible Net Worth required to
satisfy this Section 7.01(c) for the immediately preceding Fiscal Year
(regardless of the actual Consolidated Tangible Net Worth for such Fiscal Year)
minus (ii) the amount of all Designated Stock Purchases made since the
- -----
first day of Fiscal Year 1995 plus (iii) 50% of Consolidated Net Income for the
----
Test Year.
7.02. Liens. The Borrower shall not, and shall not permit any
-----
Subsidiary to, at any time create, incur, assume or suffer to exist any Lien on
any of its property (now owned or hereafter acquired), or agree, become or
remain liable (contingently or otherwise) to do any of the foregoing, except for
the following ("Permitted Liens"):
(a) Liens arising from taxes, assessments, charges or claims
described in Section 6.03 hereof that are not yet due or that remain
payable without penalty or to the extent permitted to remain unpaid under
the proviso to such Section 6.03;
(b) Deposits or pledges of cash or securities in the ordinary course
of business to secure (i) workmen's compensation, unemployment insurance or
other social security obligations, (ii) performance of bids, tenders, trade
contracts (other than for payment of money) or leases, (iii) stay, surety
or appeal bonds, or (iv) other obligations of a like nature incurred in the
ordinary course of business;
(c) Liens by a Borrower or Subsidiary on property securing all or
part of the purchase price thereof and Liens (whether or not assumed)
existing on property at the time of purchase thereof by the Borrower or a
Subsidiary, provided that:
(i) such Lien is created before or substantially simultaneously
with the purchase of such property by the Borrower or such Subsidiary
(or is a Lien securing successor obligations incurred to refinance
predecessor obligations allowed under this subsection (c), provided
that in each case the successor obligation is an obligation of the
same Person subject to the predecessor Indebtedness and is not greater
than (and is not otherwise on terms less advantageous than) the
predecessor obligation immediately before such refinancing, and the
Lien securing the successor obligation does not extend to any property
other than that subject to the Lien securing the predecessor
obligation immediately before such refinancing),
(ii) such Lien is confined solely to the property so purchased,
improvements thereto and proceeds thereof,
(iii) the aggregate amount secured by all such Liens on any
particular property at the time purchased by the Borrower or such
Subsidiary, as the case may be, shall not exceed the lesser of the
purchase price of such property or the fair market value of such
property at the time of purchase thereof ("purchase price" for this
purpose including the amount secured by each such Lien thereon whether
or not assumed), and
(iv) the aggregate amount secured by all Liens described in this
Section 7.02(c), plus the aggregate amount of Capitalized Lease
Obligations described in Section 7.03(d) hereof, shall not at any time
exceed $8,000,000;
(d) Zoning restrictions, easements, minor restrictions on the use of
real property, minor irregularities in title thereto and other minor Liens
that do not secure the payment of money or the performance of an obligation
and that do not in the aggregate materially detract from the value of a
property or asset to, or materially impair its use in the business of, the
Borrower or such Subsidiary;
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<PAGE>
(e) Liens on property of the Borrower to secure payment of
Indebtedness of the Borrower permitted by Section 7.03(g) hereof; and
(f) Liens existing on the Closing Date and approved by the Required
Lenders, which Liens are listed on Schedule 7.02 hereto (but not any
extension, renewal or replacement of such Liens).
"Permitted Lien" shall in no event include any Lien imposed by, or required to
be granted pursuant to, ERISA or any Environmental Law.
7.03. Indebtedness. The Borrower shall not, and shall not permit any
------------
Subsidiary to, at any time create, incur, assume or suffer to exist any
Indebtedness, or agree, become or remain liable (contingently or otherwise) to
do any of the foregoing, except:
(a) Indebtedness to the Lenders, the Issuing Bank and the Agent
pursuant to this Agreement and the other Loan Documents;
(b) Indebtedness constituting intercompany loans and advances
permitted by subsection (c), (d) or (e) of Section 7.05 hereof;
(c) Indebtedness for borrowed money or for the deferred purchase
price of property secured by a Lien permitted by Section 7.02(c) hereof;
(d) Indebtedness constituting Capitalized Lease Obligations of the
Borrower incurred in the ordinary course of business from time to time,
provided the aggregate amount of all Liens described in Section 7.02(c)
hereof plus the aggregate amount of all Capitalized Lease Obligations
----
described in this Section 7.03(d) shall not at any time exceed $8,000,000;
(e) Accounts payable to trade creditors arising out of purchases of
goods or services in the ordinary course of business;
(f) Any Restricted Indebtedness;
(g) Indebtedness for borrowed money incurred by the Borrower from
time to time and payable to a Governmental Authority, provided that such
Indebtedness enables the Borrower to obtain or utilize favorable tax
treatment or bears interest at a rate that is less than interest rates
generally available at such time in the commercial market for comparable
Indebtedness and such Indebtedness is on terms and conditions (other than
applicable interest rates) no more favorable to the holders thereof than
are applicable to the Lenders with respect to Indebtedness hereunder;
(h) Indebtedness for borrowed money incurred by the Borrower from
time to time, provided that such Indebtedness is unsecured and the
aggregate principal amount of such Indebtedness shall not exceed $2,000,000
at any time; and
(i) Indebtedness of the Borrower existing on the Closing Date and
approved by the Required Lenders, which Indebtedness is listed on Schedule
7.03 hereto (but not any extension, renewal or refinancing of such
Indebtedness); and
(j) Indebtedness of the Borrower under interest rate or currency
protection agreements, interest rate or currency futures, interest rate or
currency options, interest rate or currency swap or cap agreements or other
interest rate or currency hedge agreements incurred in the ordinary
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<PAGE>
course of business, provided that (i) such Indebtedness is incurred with
one or more of the Lenders as the counterparties and (ii) such Indebtedness
shall not be entered into for speculative purposes.
7.04. Guaranties, Indemnities, etc. The Borrower shall not, and
----------------------------
shall not permit any Subsidiary to, be or become subject to or bound by any
Guaranty Equivalent, or agree, become or remain liable (contingently or
otherwise) to do any of the foregoing, except:
(a) Any Significant Subsidiary Guarantees;
(b) Guaranty Equivalents from time to time entered into by the
Borrower, provided that (i) in each case the Deemed Obligor is a Subsidiary
of the Borrower and (ii) the Assured Obligations of the Deemed Obligors are
(x) fully funded and constitute liabilities on the consolidated balance
sheet of the Borrower or (y) operating leases or Capitalized Leases or
other agreements entered into by a Subsidiary of the Borrower which, if
entered into by the Borrower, would have been permitted under this
Agreement;
(c) Contingent liabilities arising from the endorsement of negotiable
or other instruments for deposit or collection or similar transactions in
the ordinary course of business;
(d) Indemnities by the Borrower or any Subsidiary of the liabilities
of its directors or officers in their capacities as such as permitted by
Law;
(e) Guaranty Equivalents of the Borrower existing on the Closing Date
and approved by the Required Lenders, which Guaranty Equivalents are listed
on Schedule 7.04 hereto (but not any extension or renewal of such Guaranty
Equivalent);
(f) Indemnities by the Borrower or any Subsidiary of the Borrower
arising from or under contracts and agreements with unrelated Persons
entered into by the Borrower or such Subsidiary in the ordinary course of
business, provided that (i) if required by GAAP, such indemnities shall be
reflected on the consolidated balance sheet of the Borrower and (ii) if
such indemnities are quantifiable as contingent liabilities in accordance
with GAAP and are reflected in the footnotes to the Borrower's consolidated
financial statements, such indemnities shall be considered a Guaranty
Equivalent of the type described in Section 7.04(g) hereof and shall be
included in determining compliance with such Section.
(g) Other Guaranty Equivalents from time to time entered into by the
Borrower, provided that the maximum aggregate potential obligation of
Borrower under Guaranty Equivalents described in this Section 7.04(g) shall
not at any time exceed $2,000,000.
7.05. Loans, Advances and Investments. The Borrower shall not, and
-------------------------------
shall not permit any Subsidiary to, at any time make or suffer to exist or
remain outstanding any loan or advance to, or purchase, acquire or own
--
(beneficially or of record) any stock, bonds, notes or securities of, or any
partnership interest (whether general or limited) in, or any other interest in,
or make any capital contribution to or other investment in, any other Person, or
- --
agree, become or remain liable (contingently or otherwise) to do any of the
foregoing, except:
(a) Loans and investments existing on the date hereof and listed in
Schedule 7.05 hereof (and extensions, renewals and refinancings thereof on
terms no less favorable than those existing immediately before such
extension, renewal or refinancing), investments by the Borrower in publicly
traded securities not exceeding at any time $150,000 in the aggregate
(determined by reference to the consideration paid by the Borrower for such
securities) and investments in
-54-
<PAGE>
securities obtained by the Borrower or any Subsidiary of the Borrower in
settlement of, or as a direct result of, any action, claim or proceeding by
the Borrower or such Subsidiary;
(b) Receivables owing to the Borrower or any Subsidiary arising from
sales of inventory under usual and customary terms in the ordinary course
of business;
(c) Loans and advances to officers, employees and Affiliates of the
Borrower and its Subsidiaries and in amounts at any time outstanding not
exceeding $2,000,000 in the aggregate;
(d) Loans and advances from a Subsidiary to the Borrower (it being
agreed that the Borrower shall, at the request of the Required Lenders from
time to time, forthwith cause each such Subsidiary to subordinate all such
loans and advances, then existing or thereafter arising, to the Obligations
upon terms and conditions satisfactory to the Required Lenders);
(e) Loans from the Borrower to a Significant Subsidiary, provided
that the aggregate principal amount of all such loans at any time shall not
exceed $5,000,000;
(f) The capital stock of a Subsidiary owned on the date hereof and
listed on Schedule 4.16 hereto and capital stock obtained in a transaction
permitted by Section 7.09 hereof; and
(g) Cash Equivalent Investments.
7.06. Dividends and Related Distributions. The Borrower shall not,
-----------------------------------
and shall not permit any Subsidiary to, declare or make any Stock Payment, or
agree, become or remain liable (contingently or otherwise) to do any of the
foregoing, except as follows:
(a) A Subsidiary may declare and make Stock Payments if all of the
capital stock of such Subsidiary is owned by the Borrower or by a direct or
indirect wholly-owned Subsidiary of the Borrower;
(b) The Borrower may from time to time declare and make Stock
Payments if such Stock Payments are payable solely in shares of capital
stock (or options, warrants or rights therefor) of the Borrower;
(c) The Borrower may from time to time declare and pay cash dividends
on its common stock, if on the date of such payment or immediately
thereafter and after giving effect thereto, no Event of Default or
Potential Default shall exist;
(d) The Borrower may from time to time purchase, redeem, retire or
acquire shares of its capital stock, if on the date of such purchase,
redemption, retirement or acquisition or immediately thereafter and after
giving effect thereto, no Event of Default or Potential Default shall
exist;
(e) The Borrower may issue shares of its capital stock in connection
with contributions made by the Borrower on behalf of employees of the
Borrower and its Subsidiaries to the Borrower's 401(k) Plan;
(f) The Borrower may issue shares of its Class A Common Stock upon
conversion of shares of its Class B Common Stock to Class A Common Stock
pursuant to and in accordance with the terms of the Class B Common Stock;
and
(g) The Borrower may issue shares of its capital stock upon the
exercise of options granted with respect thereto pursuant to the terms of
such options.
-55-
<PAGE>
The Borrower shall not declare any dividend payable later than 90 days after
declaration and shall not permit any Subsidiary to declare any dividend payable
later than 15 days after declaration.
7.07. Sale-Leasebacks. The Borrower shall not, and shall not permit
---------------
any Subsidiary to, at any time enter into or suffer to remain in effect any
transaction to which the Borrower or such Subsidiary is a party involving the
sale, transfer or other disposition by the Borrower or any Subsidiary of any
property (now owned or hereafter acquired), with a view directly or indirectly
to the leasing back of any part of the same property or any other property used
for the same or a similar purpose or purposes, or agree, become or remain liable
(contingently or otherwise) to do any of the foregoing.
7.08. Leases. The Borrower shall not, and shall not permit any
------
Subsidiary to, at any time enter into or suffer to remain in effect any lease,
as lessee, of any property, or agree, become or remain liable (contingently or
otherwise) to do any of the foregoing, except:
(a) Operating leases of real or personal property, provided that (i)
as of December 31 of each year, the Consolidated Lease Expense on account
of such leases for such year shall not exceed $10,409,000 and (ii) such
leases are not cancellable by any party thereto;
(b) Capitalized Leases permitted under Section 7.03(d) hereof; and
(c) Operating leases of real or personal property, provided that such
leases are cancellable by the Borrower or one of its Subsidiaries without
penalty on not more than 30 days prior notice.
7.09. Mergers, Acquisitions, etc. The Borrower shall not, and shall
--------------------------
not permit any Subsidiary to (v) merge with or into or consolidate with any
other Person, (w) liquidate, wind-up, dissolve or divide, (x) acquire all or any
substantial portion of the properties or assets of any going concern or going
line of business, or (y) acquire all or any substantial portion of the
properties, assets, capital stock or other equity interests in or of any other
Person other than in the ordinary course of business, or (z) agree, become or
remain liable (contingently or otherwise) to do any of the foregoing, except:
(a) Another Person or Persons may merge with the Borrower, provided
that (i) the Borrower shall be the surviving corporation, (ii) the business
of such other Person or Persons shall be within the Borrower's line of
business or a related line of business or shall use production or
manufacturing technology used in the Borrower's line of business, and (iii)
no Event of Default or Potential Default shall occur and be continuing or
shall exist at such time or after giving effect so such transaction;
(b) The Borrower may (w) acquire all or substantially all of the
properties or assets of any going concern or going line of business, (x)
acquire all or substantially all of the properties or assets of any other
Person, (y) acquire all or substantially all of the capital stock or other
equity interests in or of any other Person, and (z) agree, become or remain
liable (contingently or otherwise) to do any of the foregoing
(collectively, "Acquisitions") provided that (i) no Event of Default or
Potential Default shall occur and be continuing or shall exist at such time
or after giving effect to such transaction, (ii) the business or properties
so acquired shall be within the Borrower's line of business or a related
line of business or shall use production or manufacturing technology used
in the Borrower's line of business, and (iii) as of the end of each Fiscal
Year of the Borrower, the aggregate consideration (determined in accordance
with GAAP) paid by the Borrower in connection with all Acquisitions shall
not exceed: (A) during Fiscal Year 1995 (inclusive of Acquisitions made in
Fiscal Year 1995 prior to the date hereof), an amount equal to (1)
$27,500,000 minus (2) the aggregate amount of all Capital Expenditures made
-----
by the Borrower during such Fiscal Year to the extent permitted by Section
7.13 hereof;
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<PAGE>
and (B) for each Fiscal Year thereafter, an amount equal to
(1) $20,000,000 minus (2) the aggregate amount of all Capital Expenditures
-----
made by the Borrower during such Fiscal Year to the extent permitted by
Section 7.13 hereof; provided that the amount set forth in clause (B) above
--------
shall be increased for each Fiscal Year commencing with Fiscal Year 1996 by
the amount (not to exceed $15,000,000 in any Fiscal Year), if any, by which
the aggregate amount of (x) Capital Expenditures of the Borrower and its
consolidated Subsidiaries during the immediately preceding Fiscal Year plus
----
(y) the aggregate amount of all consideration (determined in accordance
with GAAP) paid by the Borrower during the immediately preceding Fiscal
Year in connection with Acquisitions is less than $27,500,000 (in the case
of Acquisitions made during Fiscal Year 1995) or $20,000,000 (in all
succeeding Fiscal Years);
(c) A wholly-owned Subsidiary of the Borrower or any of its
Subsidiaries may merge with or into or consolidate with any other wholly-
owned Subsidiary of the Borrower or any of its Subsidiaries, provided that
no Event of Default or Potential Default shall occur and be continuing or
shall exist at such time or after giving effect to such transaction;
(d) A wholly-owned Subsidiary of the Borrower or any of its
Subsidiaries may merge with the Borrower, provided that the Borrower shall
be the surviving corporation and no Event of Default or Potential Default
shall occur and be continuing or shall exist at such time or after giving
effect to such transaction; and
(e) The Borrower may enter into a single joint venture or otherwise
acquire less than 51% of the voting power of the equity securities of a
Person in connection with the prospective transaction with an unrelated
Person disclosed to the Agent and the Lenders in writing prior to the date
of this Agreement, provided that (i) such prospective transaction shall be
deemed to be an "Acquisition" for purposes of determining compliance with
Sections 7.09(b) and 7.13 hereof; (ii) no Event of Default or Potential
Default shall occur and be continuing or shall exist at such time or after
giving effect to such transaction and (iii) the business or properties of
such joint venture or acquisition shall be within the Borrower's line of
business or a related line of business or shall use production or
manufacturing technology used in the Borrower's line of business.
7.10. Dispositions of Properties. The Borrower shall not, and shall
--------------------------
not permit any Subsidiary to, sell, convey, assign, lease, transfer, abandon or
otherwise dispose of, voluntarily or involuntarily, any of its properties, or
agree, become or remain liable (contingently or otherwise) to do any of the
foregoing, except:
(a) The Borrower and each Subsidiary may sell inventory in the
ordinary course of business;
(b) The Borrower and each Subsidiary may dispose of equipment which
is obsolete or no longer useful in the business of the Borrower or such
Subsidiary and an amount equal to the Net Cash Proceeds of such disposition
shall be paid as a mandatory prepayment in accordance with Section 2.08(b)
hereof;
(c) The Borrower and each Subsidiary may sell or otherwise dispose of
plant, property and equipment, provided that the aggregate consideration
received by the Borrower and its Subsidiaries in connection with such sale
or disposition during any calendar year does not exceed $5,000,000 and an
amount equal to the Net Cash Proceeds of such sale or disposition shall be
paid as a mandatory prepayment in accordance with Section 2.08(b) hereof;
and
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(d) The Borrower and each Subsidiary may sell or otherwise dispose of
accounts receivable, provided that an amount equal to the Net Cash Proceeds
of such sale or disposition shall be paid as a mandatory prepayment in
accordance with Section 2.08(b) hereof.
7.11. Issuance of Subsidiary Stock. The Borrower shall not suffer
----------------------------
any of its Subsidiaries to issue, sell, otherwise dispose or suffer to remain
outstanding, voluntarily or involuntarily, any shares of such Subsidiary's
capital stock, or any options, warrants, calls, subscriptions, conversion
rights, exchange rights, preemptive rights or other rights, agreements or
arrangements (contingent or otherwise) which may in any circumstances now or
hereafter obligate any Subsidiary to issue any shares of its capital stock,
except (i) shares of capital stock outstanding on the date of this Agreement and
set forth on Schedule 4.16 hereof and (ii) in connection with transactions
permitted by Section 7.09 hereof.
7.12. Dealings with Affiliates. The Borrower shall not, and shall
------------------------
not permit any Subsidiary to, enter into or carry out any transaction with
(including, without limitation, purchase or lease property or services from,
sell or lease property or services to, loan or advance to, or enter into, suffer
to remain in existence or amend (other than automatic renewals or extensions
pursuant to the terms thereof) any contract, agreement or arrangement with) any
Affiliate of the Borrower (excluding for these purposes Affiliates of the
Borrower which are Subsidiaries of the Borrower), directly or indirectly, or
agree, become or remain liable (contingently or otherwise) to do any of the
foregoing, except:
(a) Existence and performance of contracts, agreements and
arrangements in existence as of the date of this Agreement and approved by
the Required Lenders, which contracts, agreements and arrangements are set
forth in Schedule 7.12 hereof;
(b) Directors and officers of the Borrower and its Subsidiaries may
be compensated for services rendered in such capacity to the Borrower or
such Subsidiary (which compensation may be fixed pursuant to the terms of a
written agreement with such directors or officers or an amendment thereto),
provided that the board of directors of the Borrower (including a majority
of the directors having no direct or indirect interest in such transaction)
approve the same as to the "named executive officers" identified in the
Borrower's annual proxy statement relating to its annual meeting of
stockholders;
(c) Transactions in the ordinary course of business and consistent
with past practices between a Subsidiary of the Borrower, on the one hand,
and the Borrower or another Subsidiary of the Borrower, on the other hand,
in good faith and on terms no less favorable to the Borrower or either
Subsidiary than those that could have been obtained in a comparable
transaction on an arm's-length basis from an unrelated Person;
(d) Loans and advances permitted by Section 7.05(c) hereof; and
(e) Other transactions with Affiliates not exceeding in any Fiscal
Year $250,000 in the aggregate.
7.13. Capital Expenditures. The Borrower shall not, and shall not
--------------------
permit any Subsidiary to, make any Capital Expenditures on or after the date
hereof, except for Capital Expenditures such that as of the end of each Fiscal
Year of the Borrower, Capitalized Expenditures of the Borrower and its
Consolidated Subsidiaries, determined on a consolidated basis, for such Fiscal
Year, shall not exceed the following amounts: (a) during Fiscal Year 1995
(inclusive of Capital Expenditures made in Fiscal Year 1995 prior to the date
hereof), an amount equal to (i) $27,500,000 minus (ii) the aggregate amount of
-----
all consideration (determined in accordance with GAAP) paid by the Borrower
during such Fiscal Year in connection with Acquisitions permitted by Section
7.09(b) hereof;
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and (b) for each Fiscal Year thereafter, an amount equal to (i) $20,000,000
minus (ii) the aggregate amount of all consideration (determined in
- -----
accordance with GAAP) paid by the Borrower during such Fiscal Year in connection
with Acquisitions permitted by Section 7.09(b) hereof; provided that the amount
--------
set forth in clause (b) above shall be increased for each Fiscal Year commencing
with Fiscal Year 1996 by the amount (not to exceed $15,000,000 in any Fiscal
Year), if any, by which the aggregate amount of (x) Capital Expenditures of the
Borrower and its consolidated Subsidiaries during the immediately preceding
Fiscal Year plus (y) the aggregate amount of all consideration (determined in
----
accordance with GAAP) paid by the Borrower during the immediately preceding
Fiscal Year in connection with Acquisitions is less than $27,500,000 (in the
case of Acquisitions made during Fiscal Year 1995) or $20,000,000 (in all
succeeding Fiscal Years).
7.14. Limitations on Modification of Certain Agreements and
-----------------------------------------------------
Instruments. The Borrower shall not, and shall not permit any Subsidiary to,
- -----------
amend, modify or supplement in any material respect its articles of
incorporation or by-laws (or similar constituent documents). The Borrower shall
not amend, modify or supplement in any material respect the IDA Facility;
provided, that the foregoing shall not affect the ability of the Borrower to
- --------
prepay the IDA Facility, so long as the Borrower causes all Liens securing the
IDA Facility to be released within 60 days of such prepayment.
7.15. Limitation on Payments and Modification of Restricted
-----------------------------------------------------
Indebtedness. The Borrower shall not, and shall not permit any Subsidiary to,
- ------------
directly or indirectly, pay, prepay, purchase, redeem, retire, defease or
acquire, or make any payment (on account of principal, interest, premium or
--
otherwise) of, or grant or suffer the existence of any Lien on any of its
--
property (now owned or hereafter acquired) to secure any indebtedness,
obligation or liability with respect to, or amend, modify or supplement any of
--
the terms and conditions of, any Restricted Indebtedness, or, or agree, become
or remain liable (contingently or otherwise) to do any of the foregoing, except
as follows:
(a) The Borrower and each Subsidiary may pay principal of Restricted
Indebtedness at the regularly scheduled maturity thereof, and may make
mandatory prepayments or mandatory sinking fund payments when due, and may
pay interest thereon when due, all to the extent consistent with the
subordination provisions, if any, of such Restricted Indebtedness.
7.16. Limitation on Other Restrictions on Dividends by Subsidiaries,
--------------------------------------------------------------
etc. The Borrower shall not permit any Subsidiary to be or become subject to
- ---
any restriction of any nature (whether arising by operation of Law, by
agreement, by its articles of incorporation, by-laws or other constituent
documents of such Subsidiary, or otherwise) on the right of such Subsidiary from
time to time to (w) declare and pay Stock Payments with respect to capital stock
owned by the Borrower or any Subsidiary, (x) pay any indebtedness, obligations
or liabilities from time to time owed to the Borrower or any Subsidiary, or (y)
make loans or advances to the Borrower or any Subsidiary, or (z) transfer any of
its properties or assets to the Borrower or any Subsidiary, except:
(a) Restrictions pursuant to the Loan Documents;
(b) Legal restrictions of general applicability under the corporation
law under which such Subsidiary is incorporated, and fraudulent conveyance
or similar laws or general applicability for the benefit of creditors of
such Subsidiary generally; and
(c) With respect to clause (z) above: (i) non-assignment provisions
of any contract or of any lease by the Borrower or such Subsidiary as
lessee, and (ii) restrictions on transfer of property subject to a
Permitted Lien under Sections 7.02(b) and 7.02(c) hereof for the benefit of
the holder of such Permitted Lien.
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7.17. Limitation on Other Restrictions on Liens. The Borrower shall
-----------------------------------------
not, and shall not permit any Subsidiary to, enter into, become or remain
subject to any agreement or instrument to which the Borrower or such Subsidiary
is a party or by which either of them or any of their respective properties (now
owned or hereafter acquired) may be subject or bound that would prohibit the
grant of any Lien upon any of its properties (now owed or hereafter required),
except:
(a) The Loan Documents; and
(b) Restrictions pursuant to non-assignment provisions of any
contract or of any lease by the Borrower or such Subsidiary as lessee.
7.18. Limitation on Other Restrictions on Amendment of the Loan
---------------------------------------------------------
Documents, etc. The Borrower shall not, and shall not permit any Subsidiary to,
- --------------
enter into, become or remain subject to any agreement or instrument to which the
Borrower or such Subsidiary is a party or by which either of them or any of
their respective properties (now owned or hereafter acquired) may be subject or
bound that would prohibit or require the consent of any Person to any amendment,
modification or supplement to any of the Loan Documents, except for (i) the Loan
Documents and (ii) the agreements and instruments set forth on Schedule 7.18
hereto.
ARTICLE VIII
DEFAULTS
--------
8.01. Events of Default. An "Event of Default" shall mean the
-----------------
occurrence or existence of one or more of the following events or conditions
(for any reason, whether voluntary, involuntary or effected or required by Law):
(a) The Borrower shall fail to pay when due principal of any Loan,
any Reimbursement Obligation or any required cash collateralization of
outstanding Letters of Credit.
(b) The Borrower or any other Loan Party shall fail to pay when due
interest on any Loan, any fees, indemnity or expenses, or any other amount
due hereunder or under any other Loan Document and such failure shall have
continued for a period of 10 days after notice to the Borrower.
(c) Any representation or warranty made or deemed made by the
Borrower or any Subsidiary of the Borrower in or pursuant to or in
connection with any Loan Document, or any statement made by the Borrower or
any Subsidiary of the Borrower in any financial statement, certificate,
report, exhibit or document furnished by the Borrower or any Subsidiary of
the Borrower to the Agent or any Lender pursuant to or in connection with
any Loan Document, shall prove to have been false or misleading in any
material respect as of the time when made or deemed made (including by
omission of material information necessary to make such representation,
warranty or statement not misleading).
(d) The Borrower shall default in the performance or observance of
any covenant contained in Article VII hereof or any of the covenants
contained in Sections 2.08 or 6.01(i)(i) hereof.
(e) The Borrower or any other Loan Party shall default in the
performance or observance of any other covenant, agreement or duty under
this Agreement or any other Loan Document and (i) in the case of a default
under Section 6.01 hereof (other than as referred to in
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subsection (i)(i) thereof) such default shall have continued for a period
of ten days and (ii) in the case of any other default such default shall
have continued for a period of 30 days after notice from the Agent to the
Borrower.
(f) Any Cross-Default Event shall occur with respect to any Cross-
Default Obligation; provided, that if a Cross-Default Event would have
--------
occurred with respect to a Cross-Default Obligation but for the grant of a
waiver or similar indulgence, a Cross-Default Event shall nevertheless be
deemed to have occurred if the Borrower or any Subsidiary of the Borrower
directly or indirectly gave or agreed to give any consideration for such
waiver or indulgence (including but not limited to a reduction in maturity,
an increase in rates or the granting of collateral). As used herein,
"Cross-Default Obligation" shall mean any Indebtedness for borrowed money
(or set of related indebtedness for borrowed money) of the Borrower or any
Subsidiary of the Borrower in excess of $250,000 in aggregate principal
amount and any Indebtedness or Guaranty Equivalent of the Borrower or any
Subsidiary of the Borrower, or any agreement or instrument creating,
evidencing or securing such Indebtedness or Guaranty Equivalent. As used
herein, "Cross-Default Event" with respect to a Cross-Default Obligation
shall mean (i) the occurrence of any default, event or condition which
causes or which would permit any Person or Persons to cause or which would
with the giving of notice or the passage of time or both would permit any
Person or Persons to cause all or any part of such Cross-Default Obligation
to become due (by acceleration, mandatory prepayment or repurchase, or
otherwise) before its otherwise stated maturity, or (ii) failure to pay all
or any part of such Cross-Default Obligation at its stated maturity and any
failure to pay any monetary obligation under any Cross-Default Obligation
when due, or (iii) any other default by the Borrower or any Subsidiary of
the Borrower under any Cross-Default Obligation shall continue unremedied
(and unwaived) for a period of thirty calendar days (or such longer period
of time as the Borrower or such Subsidiary is contesting or attempting to
cure in good faith such other default, but in no event for more than 90
calendar days).
(g) [Intentionally omitted].
(h) One or more judgments for the payment of money shall have been
entered against the Borrower or any Subsidiary of the Borrower, which
judgment or judgments exceed $250,000 in the aggregate, and such judgment
or judgments shall have remained undischarged and unstayed for a period of
thirty consecutive days.
(i) One or more writs or warrants of attachment, garnishment,
execution, distraint or similar process exceeding in value the aggregate
amount of $250,000 shall have been issued against the Borrower or any
Subsidiary of the Borrower or any of their respective properties and shall
have remained undischarged and unstayed for a period of thirty consecutive
days.
(j) Any Governmental Action now or hereafter made by or with any
Governmental Authority in connection with any Loan Document is not obtained
or shall have ceased to be in full force and effect or shall have been
modified or amended or shall have been held to be illegal or invalid, and
the Required Lenders shall have determined in good faith (which
determination shall be conclusive) that such event or condition could have
a Material Adverse Effect.
(k) Any Loan Document or term or provision thereof shall cease to be
in full force and effect (except in accordance with the express terms of
such Loan Document), or the Borrower or any other Loan Party shall, or
shall purport to, terminate (except in accordance with the terms of such
Loan Document), repudiate, declare voidable or void or otherwise contest,
any Loan Document or term or provision thereof or any obligation or
liability of the Borrower or any other Loan Party thereunder.
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<PAGE>
(l) The Required Lenders shall have determined in good faith (which
determination shall be conclusive) that an event or condition has occurred
which could have a Material Adverse Effect.
(m) Any one or more Pension-Related Events referred to in subsection
(a)(ii), (b) or (e) of the definition of "Pension-Related Event" shall have
occurred; or any one or more other Pension-Related Events shall have
occurred and the Required Lenders shall determine in good faith (which
determination shall be conclusive) that such other Pension-Related Events,
individually or in the aggregate, could have a Material Adverse Effect.
(n) Any one or more of the events or conditions set forth in the
following clauses (i) or (ii) shall have occurred in respect of the
Borrower or any Subsidiary of the Borrower or any of their respective
Environmental Affiliates, and the Required Lenders shall determine in good
faith (which determination shall be conclusive) that such events or
conditions, individually or in the aggregate, could have a Material Adverse
Effect: (i) any past or present violation of any Environmental Law by such
Person, (ii) existence of any pending or threatened Environmental Claim
against any such Person, or existence of any past or present acts,
omissions, events or circumstances that could form the basis of any
Environmental Claim against any such Person.
(o) A Change of Control shall have occurred.
(p) A proceeding shall have been instituted in respect of the
Borrower or any Subsidiary of the Borrower
(i) seeking to have an order for relief entered in respect of
such Person, or seeking a declaration or entailing a finding that such
Person is insolvent or a similar declaration or finding, or seeking
dissolution, winding-up, charter revocation or forfeiture,
liquidation, reorganization, arrangement, adjustment, composition or
other similar relief with respect to such Person, its assets or its
debts under any Law relating to bankruptcy, insolvency, relief of
debtors or protection of creditors, termination of legal entities or
any other similar Law now or hereafter in effect, or
(ii) seeking appointment of a receiver, trustee, liquidator,
assignee, sequestrator or other custodian for such Person or for all
or any substantial part of its property
and such proceeding shall result in the entry, making or grant of any such
order for relief, declaration, finding, relief or appointment, or such
proceeding shall remain undismissed and unstayed for a period of thirty
consecutive days.
(q) The Borrower or any Subsidiary of the Borrower shall cease to be
Solvent; shall fail to pay, become unable to pay, or state that it is or
will be unable to pay, its debts as they become due; shall voluntarily
suspend transaction of its business; shall make a general assignment for
the benefit of creditors; shall institute (or fail to controvert in a
timely and appropriate manner) a proceeding described in Section 8.01(p)(i)
hereof, or (whether or not any such proceeding has been instituted) shall
consent to or acquiesce in any such order for relief, declaration, finding
or relief described therein; shall institute (or fail to controvert in a
timely and appropriate manner) a proceeding described in Section
8.01(p)(ii) hereof, or (whether or not any such proceeding has been
instituted) shall consent to or acquiesce in any such appointment or to the
taking of possession by any such custodian of all or any substantial part
of its property; shall dissolve, wind-up, revoke or forfeit its charter (or
other constituent documents) or liquidate itself or any substantial part of
its property (except to the extent expressly permitted by Section 7.10
hereof); or shall take any action in furtherance of any of the foregoing.
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8.02. Consequences of an Event of Default.
-----------------------------------
(a) If an Event of Default specified in subsections (a) through (o)
of Section 8.01 hereof shall occur and be continuing or shall exist, then, in
addition to all other rights and remedies which the Agent or any Lender may have
hereunder or under any other Loan Document, at law, in equity or otherwise, the
Lenders shall be under no further obligation to make Loans hereunder, and the
Agent may, and upon the written request of the Required Lenders shall, by notice
to the Borrower, from time to time do any or all of the following:
(i) Declare the Commitments terminated, whereupon the Commitments
will terminate and any fees hereunder shall be immediately due and payable
without presentment, demand, protest or further notice of any kind, all of
which are hereby waived, and an action therefor shall immediately accrue.
(ii) Declare the unpaid principal amount of the Loans, interest
accrued thereon and all other Obligations to be immediately due and payable
without presentment, demand, protest or further notice of any kind, all of
which are hereby waived, and an action therefor shall immediately accrue.
(b) If an Event of Default specified in subsection (p) or (q) of
Section 8.01 hereof shall occur or exist, then, in addition to all other rights
and remedies which the Agent or any Lender may have hereunder or under any other
Loan Document, at law, in equity or otherwise, the Commitments shall
automatically terminate and the Lenders shall be under no further obligation to
make Loans, and the unpaid principal amount of the Loans, interest accrued
thereon and all other Obligations (including but not limited to the obligation
to cash collateralize outstanding Letters of Credit) shall become immediately
due and payable without presentment, demand, protest or notice of any kind, all
of which are hereby waived, and an action therefor shall immediately accrue.
ARTICLE IX
THE AGENT
---------
9.01. Appointment. Each Lender hereby irrevocably appoints Mellon to
-----------
act as Agent for such Lender under this Agreement and the other Loan Documents.
Each Lender hereby irrevocably authorizes the Agent to take such action on
behalf of such Lender under the provisions of this Agreement and the other Loan
Documents, and to exercise such powers and to perform such duties, as are
expressly delegated to or required of the Agent by the terms hereof or thereof,
together with such powers as are reasonably incidental thereto. Mellon hereby
agrees to act as Agent on behalf of the Lenders on the terms and conditions set
forth in this Agreement and the other Loan Documents, subject to its right to
resign as provided in Section 9.10 hereof. Each Lender hereby irrevocably
authorizes the Agent to execute and deliver each of the Loan Documents and to
accept delivery of such of the other Loan Documents as may not require execution
by the Agent. Each Lender agrees that the rights and remedies granted to the
Agent under the Loan Documents shall be exercised exclusively by the Agent, and
that no Lender shall have any right individually to exercise any such right or
remedy, except to the extent expressly provided herein or therein.
9.02. General Nature of Agent's Duties. Notwithstanding anything to
--------------------------------
the contrary elsewhere in this Agreement or in any other Loan Document:
(a) The Agent shall have no duties or responsibilities except those
expressly set forth in this Agreement and the other Loan Documents, and no
implied duties or responsibilities on the part of the Agent shall be read into
this Agreement or any Loan Document or shall otherwise exist.
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<PAGE>
(b) The duties and responsibilities of the Agent under this Agreement
and the other Loan Documents shall be mechanical and administrative in nature,
and the Agent shall not have a fiduciary relationship in respect of any Lender.
(c) The Agent is and shall be solely the agent of the Lenders. The
Agent does not assume, and shall not at any time be deemed to have, any
relationship of agency or trust with or for, or any other duty or responsibility
to, any Loan Party or any other Person (except only for its relationship as
agent for, and its express duties and responsibilities to, the Lenders as
provided in this Agreement and the other Loan Documents).
(d) The Agent shall be under no obligation to take any action
hereunder or under any other Loan Document if the Agent believes in good faith
that taking such action may conflict with any Law or any provision of this
Agreement or any other Loan Document, or may require the Agent to qualify to do
business in any jurisdiction where it is not then so qualified.
9.03. Exercise of Powers. The Agent shall take any action of the
------------------
type specified in this Agreement or any other Loan Document as being within the
Agent's rights, powers or discretion in accordance with directions from the
Required Lenders (or, to the extent this Agreement or such Loan Document
expressly requires the direction or consent of some other Person or set of
Persons, then instead in accordance with the directions of such other Person or
set of Persons). In the absence of such directions, the Agent shall have the
authority (but under no circumstances shall be obligated), in its sole
discretion, to take any such action, except to the extent this Agreement or such
Loan Document expressly requires the direction or consent of the Required
Lenders (or some other Person or set of Persons), in which case the Agent shall
not take such action absent such direction or consent. Any action or inaction
pursuant to such direction, discretion or consent shall be binding on all the
Lenders. The Agent shall not have any liability to any Person as a result of
(x) the Agent acting or refraining from acting in accordance with the directions
of the Required Lenders (or other applicable Person or set of Persons), (y) the
Agent refraining from acting in the absence of instructions to act from the
Required Lenders (or other applicable Person or set of Persons), whether or not
the Agent has discretionary power to take such action, or (z) the Agent taking
discretionary action it is authorized to take under this Section (subject, in
the case of this clause (z), to the provisions of Section 9.04(a) hereof).
9.04. General Exculpatory Provisions. Notwithstanding anything to
------------------------------
the contrary elsewhere in this Agreement or any other Loan Document:
(a) The Agent shall not be liable for any action taken or omitted to
be taken by it under or in connection with this Agreement or any other Loan
Document, unless caused by its own gross negligence or willful misconduct.
(b) The Agent shall not be responsible for (i) the execution,
delivery, effectiveness, enforceability, genuineness, validity or adequacy of
this Agreement or any other Loan Document, (ii) any recital, representation,
warranty, document, certificate, report or statement in, provided for in, or
received under or in connection with, this Agreement or any other Loan Document
or (iii) any failure of the Borrower or any other Loan Party or Lender to
perform any of their respective obligations under this Agreement or any other
Loan Document.
(c) The Agent shall not be under any obligation to ascertain, inquire
or give any notice relating to (i) the performance or observance of any of the
terms or conditions of this Agreement or any other Loan Document on the part of
the Borrower or any other Loan Party, (ii) the business, operations, condition
(financial or otherwise) or prospects of the Borrower and its Subsidiaries,
individually and taken as a whole, or any other Person, or (iii) except to the
extent set forth in Section 9.05(f) hereof, the existence of any Event of
Default or Potential Default.
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(d) The Agent shall not be under any obligation, either initially or
on a continuing basis, to provide any Lender with any notices, reports or
information of any nature, whether in its possession presently or hereafter,
except for such notices, reports and other information expressly required by
this Agreement or any other Loan Document to be furnished by the Agent to such
Lender.
9.05. Administration by the Agent.
---------------------------
(a) The Agent may rely upon any notice or other communication of any
nature (written or oral, including but not limited to telephone conversations,
whether or not such notice or other communication is made in a manner permitted
or required by this Agreement or any Loan Document) purportedly made by or on
behalf of the proper party or parties, and the Agent shall not have any duty to
verify the identity or authority of any Person giving such notice or other
communication.
(b) The Agent may consult with legal counsel (including, without
limitation, in-house counsel for the Agent or in-house or other counsel for the
Borrower or any other Loan Party), independent public accountants and any other
experts selected by it from time to time, and the Agent shall not be liable for
any action taken or omitted to be taken in good faith by it in accordance with
the advice of such counsel, accountants or experts.
(c) The Agent may conclusively rely upon the truth of the statements
and the correctness of the opinions expressed in any certificates or opinions
furnished to the Agent in accordance with the requirements of this Agreement or
any other Loan Document. Whenever the Agent shall deem it necessary or
desirable that a matter be proved or established with respect to the Borrower or
any other Loan Party or Lender, such matter may be established by a certificate
of the Borrower, such Loan Party or Lender, as the case may be, and the Agent
may conclusively rely upon such certificate (unless other evidence with respect
to such matter is specifically prescribed in this Agreement or another Loan
Document).
(d) The Agent may fail or refuse to take any action unless it shall
be indemnified to its satisfaction from time to time against any and all
amounts, liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements of any kind or nature which
may be imposed on, incurred by or asserted against the Agent by reason of taking
or continuing to take any such action.
(e) The Agent may perform any of its duties under this Agreement or
any other Loan Document by or through agents or attorneys-in-fact. The Agent
shall not be responsible for the negligence or misconduct of any agents or
attorneys-in fact selected by it with reasonable care; provided, that the Agent
--------
shall pursue on behalf of the Lenders any rights or remedies which the Lenders
may have against such agents or attorneys-in-fact as a result of the negligence
or misconduct of such agents or attorneys-in-fact.
(f) The Agent shall not be deemed to have any knowledge or notice of
the occurrence of any Event of Default or Potential Default unless the Agent has
received notice from a Lender, the Borrower or any other Loan Party referring to
this Agreement, describing such Event of Default or Potential Default, and
stating that such notice is a "notice of default". If the Agent receives such a
notice, the Agent shall give prompt notice thereof to each Lender.
9.06. Lender Not Relying on Agent or Other Lenders. Each Lender
--------------------------------------------
acknowledges as follows: (a) Neither the Agent nor any other Lender has made
any representations or warranties to it, and no act taken hereafter by the Agent
or any other Lender shall be deemed to constitute any representation or warranty
by the Agent or such other Lender to it. (b) It has, independently and without
reliance upon the Agent or any other Lender, and based upon such documents and
information as it has deemed appropriate, made its own credit and legal analysis
and decision to enter into this
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Agreement and the other Loan Documents. (c) It will, independently and without
reliance upon the Agent or any other Lender, and based upon such documents and
information as it shall deem appropriate at the time, make its own decisions to
take or not take action under or in connection with this Agreement and the other
Loan Documents.
9.07. Indemnification of Agent by Lenders. Each Lender agrees to
-----------------------------------
reimburse and indemnify the Agent and its directors, officers, employees and
agents (to the extent not reimbursed by the Borrower or any other Loan Party and
without limitation of the obligations of the Borrower and the other Loan Parties
to do so), Pro Rata, from and against any and all amounts, losses, liabilities,
claims, damages, expenses, obligations, penalties, actions, judgments, suits,
costs or disbursements of any kind or nature (including, without limitation, the
fees and disbursements of counsel for the Agent or such other Person in
connection with any investigative, administrative or judicial proceeding
commenced or threatened, whether or not the Agent or such other Person shall be
designated a party thereto) that may at any time be imposed on, incurred by or
asserted against the Agent or such other Person as a result of, or arising out
of, or in any way related to or by reason of, this Agreement, any other Loan
Document, any transaction from time to time contemplated hereby or thereby, or
any transaction financed in whole or in part or directly or indirectly with the
proceeds of any Loan or Letter of Credit, provided that no Lender shall be
--------
liable for any portion of such amounts, losses, liabilities, claims, damages,
expenses, obligations, penalties, actions, judgments, suits, costs or
disbursements resulting solely from the gross negligence or willful misconduct
of the Agent or such other Person, as finally determined by a court of competent
jurisdiction. Payments under this Section shall be due and payable on demand.
9.08. Agent in its Individual Capacity. With respect to its
--------------------------------
Commitments and the Obligations owing to it, the Agent shall have the same
rights and powers under this Agreement and each other Loan Document as any other
Lender and may exercise the same as though it were not the Agent, and the terms
"Lenders," "holders of Notes," "Issuing Bank" and like terms shall include the
Agent in its individual capacity as such. The Agent and its Affiliates may,
without liability to account but subject to the terms of this Agreement, make
loans to, accept deposits from, acquire debt or equity interests in, act as
trustee under indentures of, and engage in any other business with, the Borrower
and any stockholder, Subsidiary or Affiliate of the Borrower, as though the
Agent were not the Agent hereunder.
9.09. Holders of Notes. The Agent may deem and treat the Lender
----------------
which is payee of a Note as the owner and holder of such Note for all purposes
hereof unless and until a Transfer Supplement with respect to the assignment or
transfer thereof shall have been filed with the Agent in accordance with Section
10.14 hereof. Any authority, direction or consent of any Person who at the time
of giving such authority, direction or consent is shown in the Register as being
a Lender shall be conclusive and binding on each present and subsequent holder,
transferee or assignee of any Note or Notes payable to such Lender or of any
Note or Notes issued in exchange therefor.
9.10. Successor Agent. The Agent may resign at any time by giving 30
---------------
days' prior written notice thereof to the Lenders and the Borrower. The Agent
may be removed by the Required Lenders at any time by giving 30 days' prior
written notice thereof to the Agent, the other Lenders and the Borrower. Upon
any such resignation or removal, the Required Lenders shall have the right to
appoint a successor Agent. If no successor Agent shall have been so appointed
and consented to, and shall have accepted such appointment, within 30 days after
such notice of resignation or removal, then the retiring Agent may, on behalf of
the Lenders, appoint a successor Agent. Each successor Agent shall be a
commercial bank or trust company organized under the laws of the United States
of America or any State thereof and having a combined capital and surplus of at
least $1,000,000,000. Upon the acceptance by a successor Agent of its
appointment as Agent hereunder, such successor Agent shall thereupon succeed to
and become vested with all the properties, rights, powers, privileges and duties
of the former Agent, without further act, deed or conveyance. Upon the
effective date of resignation or removal of a retiring Agent, such Agent shall
be discharged from its duties under this Agreement and the other Loan Documents,
but the provisions of this Agreement shall inure to its benefit as to any
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actions taken or omitted by it while it was Agent under this Agreement. If and
so long as no successor Agent shall have been appointed, then any notice or
other communication required or permitted to be given by the Agent shall be
sufficiently given if given by the Required Lenders, all notices or other
communications required or permitted to be given to the Agent shall be given to
each Lender, and all payments to be made to the Agent shall be made directly to
the Borrower or Lender for whose account such payment is made.
9.11. Additional Agents. If the Agent shall from time to time deem
-----------------
it necessary or advisable, for its own protection in the performance of its
duties hereunder or in the interest of the Lenders, the Agent and the Borrower
shall (and the Borrower shall cause the other Loan Parties to) execute and
deliver a supplemental agreement and all other instruments and agreements
necessary or advisable, in the opinion of the Agent, to constitute another
commercial bank or trust company, or one or more other Persons approved by the
Agent, to act as co-Agent or agent, with such powers of the Agent as may be
provided in such supplemental agreement, and to vest in such bank, trust company
or Person as such co-Agent or separate agent, as the case may be, any
properties, rights, powers, privileges and duties of the Agent under this
Agreement or any other Loan Document.
9.12. Calculations. The Agent shall not be liable for any
------------
calculation, apportionment or distribution of payments made by it in good faith.
If such calculation, apportionment or distribution is subsequently determined to
have been made in error, the sole recourse of any Lender to whom payment was due
but not made shall be to recover from the other Lenders any payment in excess of
the amount to which they are determined to be entitled or, if the amount due was
not paid by the appropriate Loan Party, to recover such amount from the
appropriate Loan Party.
9.13. Agent's Fee. The Borrower agrees to pay to the Agent, for its
-----------
individual account, a nonrefundable Agent's fee in an amount and at such time or
times as the Agent and the Borrower have heretofore agreed.
9.14. Funding by Agent. Unless the Agent shall have been notified in
----------------
writing by any Lender not later than the close of business on the day before the
day on which Loans are requested by the Borrower to be made that such Lender
will not make its ratable share of such Loans, the Agent may assume that such
Lender will make its ratable share of the Loans, and in reliance upon such
assumption the Agent may (but in no circumstances shall be required to) make
available to the Borrower a corresponding amount. If and to the extent that any
Lender fails to make such payment to the Agent on such date, such Lender shall
pay such amount on demand (or, if such Lender fails to pay such amount on
demand, the Borrower shall pay such amount on demand), together with interest,
for the Agent's own account, for each day from and including the date of the
Agent's payment to and including the date of repayment to the Agent (before and
after judgment) at the rate or rates per annum applicable to such Loans. All
payments to the Agent under this Section shall be made to the Agent at its
Office in Dollars in funds immediately available at such Office, without set-
off, withholding, counterclaim or other deduction of any nature.
ARTICLE X
MISCELLANEOUS
-------------
10.01. Holidays. Whenever any payment or action to be made or taken
--------
hereunder or under any other Loan Document shall be stated to be due on a day
which is not a Business Day, such payment or action shall be made or taken on
the next following Business Day and such extension of time shall be included in
computing interest or fees, if any, in connection with such payment or action.
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10.02. Records. The unpaid principal amount of the Loans owing to
-------
each Lender, the unpaid interest accrued thereon, the interest rate or rates
applicable to such unpaid principal amount, the duration of such applicability,
each Lender's Revolving Credit Committed Amount and the accrued and unpaid fees
owing to each Lender and the Issuing Bank shall at all times be ascertained from
the records of the Agent, which shall be conclusive absent manifest error. The
unpaid Reimbursement Obligations, the unpaid interest accrued thereon and the
interest rate on rates applicable thereto shall at all times be ascertained from
the records of the Issuing Bank, which shall be conclusive absent manifest
error.
10.03. Amendments and Waivers. Neither this Agreement nor any Loan
----------------------
Document may be amended, modified or supplemented except in accordance with the
provisions of this Section. Subject to the fourth sentence of this Section
10.03, the Agent (acting at the direction of the Required Lenders) and the
Borrower may from time to time amend, modify or supplement the provisions of
this Agreement or any other Loan Document for the purpose of amending, adding
to, or waiving any provisions or changing in any manner the rights and duties of
any Loan Party, the Agent or any Lender. Any such amendment, modification or
supplement made by Borrower and the Agent in accordance with the provisions of
this Section shall be binding upon the Borrower, each Lender and the Agent. The
Agent shall enter into such amendments, modifications or supplements from time
to time as directed by the Required Lenders, and only as so directed, provided,
--------
that no such amendment, modification or supplement may be made which will:
(a) Increase the Revolving Credit Committed Amount of any Lender over
the amount thereof then in effect, or extend the Revolving Credit Maturity
Date, without the written consent of each Lender affected thereby;
(b) Reduce the principal amount of or extend the time for any payment
of principal of any Loan, or reduce the rate of interest or extent the time
for payment of interest borne by any Loan or Reimbursement Obligation
(other than as a result of waiving the applicability of any increase in
interest rates applicable to overdue amounts), or extend the time for
payment of or reduce the amount of any Revolving Credit Commitment Fee or
Letter of Credit Fee, or reduce or postpone the date for payment of any
other fees, expenses, indemnities or amounts payable under any Loan
Document, without the written consent of each Lender affected thereby;
(c) Change the definition of "Required Lenders" or amend this Section
10.03, without the written consent of all the Lenders;
(d) Amend or waive any of the provisions of Article X hereof, or
impose additional duties upon the Agent or otherwise adversely affect the
rights, interests or obligations of the Agent, without the written consent
of the Agent; or
(e) Amend or waive any of the provisions of Article III, or impose
additional duties on the Issuing Bank or otherwise adversely affect the
rights, interests or obligations of the Issuing Bank without the consent of
Mellon;
and provided further, that Transfer Supplements may be entered into in the
----------------
manner provided in Section 10.14 hereof. Any such amendment, modification or
supplement must be in writing and shall be effective only to the extent set
forth in such writing. Any Event of Default or Potential Default waived or
consented to in any such amendment, modification or supplement shall be deemed
to be cured and not continuing to the extent and for the period set forth in
such waiver or consent, but no such waiver or consent shall extend to any other
or subsequent Event of Default or Potential Default or impair any right
consequent thereto.
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10.04. No Implied Waiver; Cumulative Remedies. No course of dealing
--------------------------------------
and no delay or failure of the Agent or any Lender in exercising any right,
power or privilege under this Agreement or any other Loan Document shall affect
any other or future exercise thereof or exercise of any other right, power or
privilege; nor shall any single or partial exercise of any such right, power or
privilege or any abandonment or discontinuance of steps to enforce such a right,
power or privilege preclude any further exercise thereof or of any other right,
power or privilege. The rights and remedies of the Agent and the Lenders under
this Agreement and any other Loan Document are cumulative and not exclusive of
any rights or remedies which the Agent or any Lender would otherwise have
hereunder or thereunder, at law, in equity or otherwise.
10.05. Notices.
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(a) Except to the extent otherwise expressly permitted hereunder or
thereunder, all notices, requests, demands, directions and other communications
(collectively "notices") under this Agreement or any Loan Document shall be in
writing (including telexed and telecopied communication) and shall be sent by
first-class mail, or by nationally-recognized next-day courier, or by telex or
telecopier (with confirmation in writing mailed first-class or sent by such an
overnight courier), or by personal delivery. All notices shall be sent to the
applicable party at the address stated on the signature pages hereof or in
accordance with the last unrevoked written direction from such party to the
other parties hereto, in all cases with postage or other charges prepaid. Any
such properly given notice to the Borrower, the Agent or any Lender shall be
effective on the earliest to occur of receipt, telephone confirmation of receipt
of telex or telecopy communication, one Business Day after delivery to a
nationally-recognized next-day courier, or five Business Days after deposit in
the mail.
(b) Any Lender giving any notice to the Borrower or any other party
to a Loan Document shall simultaneously send a copy thereof to the Agent, and
the Agent shall promptly notify the other Lenders of the receipt by it of any
such notice.
(c) The Agent and each Lender may rely on any notice (whether or not
such notice is made in a manner permitted or required by this Agreement or any
Loan Document) purportedly made by or on behalf of the Borrower or any other
Loan Party, and neither the Agent nor any Lender shall have any duty to verify
the identity or authority of any Person giving such notice.
10.06. Expenses; Taxes; Indemnity.
--------------------------
(a) Except to the extent otherwise agreed to in writing between the
Agent and the Borrower prior to the date of this Agreement, the Borrower agrees
to pay or cause to be paid and to save the Agent and each of the Lenders
harmless against liability for the payment of all reasonable out-of-pocket costs
and expenses (including but not limited to reasonable fees and expenses of
counsel, including local counsel, auditors, consulting engineers, appraisers,
and all other professional, accounting, evaluation and consulting costs)
incurred by the Agent or any Lender from time to time arising from or relating
to (i) the negotiation, preparation, execution, delivery, administration and
performance of this Agreement and the other Loan Documents, (ii) any requested
amendments, modifications, supplements, waivers or consents (whether or not
ultimately entered into or granted) to this Agreement or any Loan Document, and
(iii) the enforcement or preservation of rights under this Agreement or any Loan
Document (including but not limited to any such costs or expenses arising from
or relating to (A) collection or enforcement of an outstanding Loan or any other
amount owing hereunder or thereunder by the Agent or any Lender and (B) any
litigation, proceeding, dispute, work-out, restructuring or rescheduling related
in any way to this Agreement or the Loan Documents).
(b) The Borrower hereby agrees to pay all stamp, document, transfer,
recording, filing, registration, search, sales and excise fees and taxes and all
similar impositions now or hereafter determined by the Agent or any Lenders to
be payable in connection with this Agreement or any other
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Loan Documents or any other documents, instruments or transactions pursuant to
or in connection herewith or therewith, and the Borrower agrees to save the
Agent and each Lender harmless from and against any and all present or future
claims, liabilities or losses with respect to or resulting from any omission to
pay or delay in paying any such fees, taxes or impositions.
(c) The Borrower hereby agrees to reimburse and indemnify each of the
Indemnified Parties from and against any and all losses, liabilities, claims,
damages, expenses, obligations, penalties, actions, judgments, suits, costs or
disbursements of any kind or nature whatsoever (including, without limitation,
the reasonable fees and disbursements of counsel for such Indemnified Party in
connection with any investigative, administrative or judicial proceeding
commenced or threatened, whether or not such Indemnified Party shall be
designated a party thereto) that may at any time be imposed on, asserted against
or incurred by such Indemnified Party as a result of, or arising out of, or in
any way related to or by reason of, this Agreement or any other Loan Document,
any transaction from time to time contemplated hereby or thereby, or any
transaction financed in whole or in part or directly or indirectly with the
proceeds of any Loan (and without in any way limiting the generality of the
foregoing, including any violation or breach of any Environmental Law or any
other Law by the Borrower or any Subsidiary of the Borrower or any Environmental
Affiliate of any of them; any Environmental Claim arising out of the management,
use, control, ownership or operation of property by any of such Persons,
including all on-site and off-site activities involving Environmental Concern
Materials; or any exercise by the Agent or any Lender of any of its rights or
remedies under this Agreement or any other Loan Document); but excluding any
such losses, liabilities, claims, damages, expenses, obligations, penalties,
actions, judgments, suits, costs or disbursements resulting solely from the
gross negligence or willful misconduct of such Indemnified Party, as finally
determined by a court of competent jurisdiction; provided, that if there is a
--------
good faith dispute between the parties as to whether any amount is payable under
this Section 10.06(c) as a result of the alleged gross negligence or willful
misconduct of an Indemnified Party, notwithstanding anything herein to the
contrary, such amount shall not be due until a final determination is made with
respect to such dispute by a court of competent jurisdiction as provided herein.
If and to the extent that the foregoing obligations of the Borrower under this
subsection (c), or any other indemnification obligation of the Borrower
hereunder or under any other Loan Document, are unenforceable for any reason,
the Borrower hereby agrees to make the maximum contribution to the payment and
satisfaction of such obligations which is permissible under applicable Law.
10.07. Severability. The provisions of this Agreement are intended
------------
to be severable. If any provision of this Agreement shall be held invalid or
unenforceable in whole or in part in any jurisdiction such provision shall, as
to such jurisdiction, be ineffective to the extent of such invalidity or
unenforceability without in any manner affecting the validity or enforceability
thereof in any other jurisdiction or the remaining provisions hereof in any
jurisdiction.
10.08. Prior Understandings. This Agreement and the other Loan
--------------------
Documents supersede all prior and contemporaneous understandings and agreements,
whether written or oral, among the parties hereto relating to the transactions
provided for herein and therein, except for the obligation of the Borrower to
pay the Agent fees in accordance with separate written agreements between the
Borrower and the Agent.
10.09. Duration; Survival. All representations and warranties of
------------------
each Loan Party contained herein or in any other in the Loan Document or made in
connection herewith or therewith shall survive the making of, and shall not be
waived by the execution and delivery, of this Agreement or any other Loan
Document, any investigation by or knowledge of the Agent or any Lender, the
making of any Loan, the issuance of any Letter of Credit or any other event or
condition whatever. All covenants and agreements of each Loan Party contained
herein or in any other Loan Document shall continue in full force and effect
from and after the date hereof so long as the Borrower may borrow hereunder and
until payment in full of all Obligations. Without limitation, all obligations
of the Borrower hereunder or under any other Loan Document to make payments to
or indemnify the Agent or
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any Lender shall survive the payment in full of all other Obligations,
termination of the Borrower's right to borrow hereunder, and all other events
and conditions whatever. In addition, all obligations of each Lender to make
payments to or indemnify the Agent shall survive the payment in full by the
Borrower of all Obligations, termination of the Borrower's right to borrow
hereunder, and all other events or conditions whatever.
10.10. 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, shall be deemed an original, but all such
counterparts shall constitute but one and the same instrument.
10.11. Limitation on Payments. The parties hereto intend to conform
----------------------
to all applicable Laws in effect from time to time limiting the maximum rate of
interest that may be charged or collected. Accordingly, notwithstanding any
other provision hereof or of any other Loan Document, the Borrower shall not be
required to make any payment to or for the account of any Lender, and each
Lender shall refund any payment made by the Borrower, to the extent that such
requirement or such failure to refund would violate or conflict with nonwaivable
provisions of applicable Laws limiting the maximum amount of interest which may
be charged or collected by such Lender.
10.12. Set-Off. The Borrower hereby agrees that if any Obligation of
-------
the Borrower shall be due and payable (by acceleration or otherwise), each
Lender shall have the right, without notice to the Borrower, to set-off against
and to appropriate and apply to such Obligation any indebtedness, liability or
obligation of any nature owing to the Borrower by such Lender, including but not
limited to all deposits (whether time or demand, general or special,
provisionally credited or finally credited, whether or not evidenced by a
certificate of deposit) now or hereafter maintained by the Borrower with such
Lender. Such right shall be absolute and unconditional in all circumstances
and, without limitation, shall exist whether or not such Lender or any other
Person shall have given notice or made any demand to the Borrower or any other
Person, whether such indebtedness, obligation or liability owed to the Borrower
is contingent, absolute, matured or unmatured (it being agreed that such Lender
may deem such indebtedness, obligation or liability to be then due and payable
at the time of such setoff), and regardless of the existence or adequacy of any
collateral, guaranty or any other security, right or remedy available to any
Lender or any other Person. The Borrower hereby agrees that any Participant and
any branch, subsidiary or affiliate of any Lender or any Participant shall have
the same rights of set-off as a Lender as provided in this Section 10.12
(regardless of whether such Participant, branch, subsidiary or affiliate would
otherwise be deemed in privity with or a direct creditor of the Borrower). The
rights provided by this Section 10.12 are in addition to all other rights of
set-off and banker's lien and all other rights and remedies which any Lender (or
any such Participant, branch, subsidiary or affiliate) may otherwise have under
this Agreement, any other Loan Document, at law or in equity, or otherwise, and
nothing in this Agreement or any Loan Document shall be deemed a waiver or
prohibition of or restriction on the rights of set-off or bankers' lien of any
such Person.
10.13. Sharing of Collections. The Lenders hereby agree among
----------------------
themselves that if any Lender shall receive (by voluntary payment, realization
upon security, set-off or from any other source) any amount on account of the
Loans, interest thereon, or any other Obligation contemplated by this Agreement
or the other Loan Documents to be made by the Borrower Pro Rata to all Lenders
in greater proportion than any such amount received by any other Lender, then
the Lender receiving such proportionately greater payment shall notify each
other Lender and the Agent of such receipt, and equitable adjustment will be
made in the manner stated in this Section so that, in effect, all such excess
amounts will be shared ratably among all of the Lenders. The Lender receiving
such excess amount shall purchase (which it shall be deemed to have done
simultaneously upon the receipt of such excess amount) for cash from the other
Lenders a participation in the applicable Obligations owed to such other Lenders
in such amount as shall result in a ratable sharing by all Lenders of such
excess amount (and to such extent the receiving Lender shall be a Participant).
If all or any portion of such excess amount is thereafter recovered from the
Lender making such purchase, such purchase shall be rescinded and the
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purchase price restored to the extent of such recovery, together with interest
or other amounts, if any, required by Law to be paid by the Lender making such
purchase. The Borrower hereby consents to and confirms the foregoing
arrangements. Each Participant shall be bound by this Section as fully as if it
were a Lender hereunder.
10.14. Successors and Assigns; Participations; Assignments.
---------------------------------------------------
(a) Successors and Assigns. This Agreement shall be binding upon and
----------------------
inure to the benefit of the Borrower, the Lenders, all future holders of the
Notes, the Agent and their respective successors and assigns, except that the
Borrower may not assign or transfer any of its rights hereunder or interests
herein without the prior written consent of all the Lenders and the Agent, and
any purported assignment without such consent shall be void.
(b) Participations. Any Lender may, in the ordinary course of its
--------------
commercial banking business and in accordance with applicable Law, at any time
sell participations to one or more commercial banks or other Persons (each a
"Participant") in all or a portion of its rights and obligations under this
Agreement and the other Loan Documents (including, without limitation, all or a
portion of its Commitments and the Loans owing to it and any Note held by it);
provided, that:
- --------
(i) any such Lender's obligations under this Agreement and the other
Loan Documents shall remain unchanged,
(ii) such Lender shall remain solely responsible to the other parties
hereto for the performance of such obligations,
(iii) the parties hereto shall continue to deal solely and directly
with such Lender in connection with such Lender's rights and obligations
under this Agreement and each of the other Loan Documents,
(iv) such Participant shall be bound by the provisions of Section
10.13 hereof, and the Lender selling such participation shall obtain from
such Participant a written confirmation of its agreement to be so bound,
and
(v) no Participant (unless such Participant is an affiliate of such
Lender, or is itself a Lender) shall be entitled to require such Lender to
take or refrain from taking action under this Agreement or under any other
Loan Document, except that such Lender may agree with such Participant that
such Lender will not, without such Participant's consent, take action of
the type described in subsections (a), (b) or (c) of Section 10.03 hereof.
The Borrower agrees that any such Participant shall be entitled to the benefits
of Sections 2.11, 2.12 and 10.06 hereof with respect to its participation in the
Commitments and the Loans outstanding from time to time; provided, that no such
--------
Participant shall be entitled to receive any greater amount pursuant to such
Sections than the transferor Lender would have been entitled to receive in
respect of the amount of the participation transferred to such Participant had
no such transfer occurred.
(c) Assignments. Any Lender may, in the ordinary course of its
-----------
commercial banking business and in accordance with applicable Law, at any time
assign all or a portion of its rights and obligations under this Agreement and
the other Loan Documents (including, without limitation, all or any portion of
its Commitments and Loans owing to it and any Note held by it) to any Lender,
any affiliate of a Lender or to one or more additional commercial banks or other
Persons (each a "Purchasing Lender"); provided, that:
--------
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(i) any such assignment to a Purchasing Lender which is not a Lender
or an Affiliate of a Lender shall be made only with the consent (which in
the case of the Borrower shall not be unreasonably withheld) of the
Borrower and the Agent,
(ii) if a Lender makes such an assignment of less than all of its
then remaining rights and obligations under this Agreement and the other
Loan Documents, such transferor Lender shall retain, after such assignment,
a minimum principal amount of $5,000,000 of the Commitments and Loans then
outstanding, and such assignment shall be in a minimum aggregate principal
amount of $5,000,000 of the Commitments and Loans then outstanding,
(iii) each such assignment shall be of a constant, and not a varying,
percentage of each Commitment of the transferor Lender and of all of the
transferor Lender's rights and obligations under this Agreement and the
other Loan Documents, and
(iv) each such assignment shall be made pursuant to a Transfer
Supplement in substantially the form of Exhibit F to this Agreement, duly
completed (a "Transfer Supplement").
In order to effect any such assignment, the transferor Lender and the Purchasing
Lender shall execute and deliver to the Agent a duly completed Transfer
Supplement (including the consents required by clause (i) of the preceding
sentence) with respect to such assignment, together with any Note or Notes
subject to such assignment (the "Transferor Lender Notes") and a processing and
recording fee of $2,000 plus out-of-pocket expenses; and, upon receipt thereof,
the Agent shall accept such Transfer Supplement. Upon receipt of the Purchase
Price Receipt Notice (as defined in the Transfer Supplement), the Agent shall
record such acceptance in the Register. Upon such execution, delivery,
acceptance and recording, from and after the close of business at the Agent's
Office on the Transfer Effective Date specified in such Transfer Supplement:
(x) the Purchasing Lender shall be a party hereto and, to the extent
provided in such Transfer Supplement, shall have the rights and obligations
of a Lender hereunder, and
(y) the transferor Lender thereunder shall be released from its
obligations under this Agreement to the extent so transferred (and, in the
case of an Transfer Supplement covering all or the remaining portion of a
transferor Lender's rights and obligations under this Agreement, such
transferor Lender shall cease to be a party to this Agreement) from and
after the Transfer Effective Date.
On or prior to the Transfer Effective Date specified in an Transfer Supplement,
the Borrower shall execute and deliver to the Agent (for delivery to the
Purchasing Lender) new Notes evidencing such Purchasing Lender's assigned
Commitments or Loans and (for delivery to the transferor Lender) replacement
Notes in the principal amount of the Loans or Commitments retained by the
transferor Lender (such Notes to be in exchange for, but not in payment of,
those Notes then held by such transferor Lender). Each such Note shall be dated
the date and be substantially in the form of the predecessor Note. The Agent
shall mark the predecessor Notes "exchanged" and deliver them to the Borrower.
Pending such delivery, the Agent shall hold the predecessor Notes in trust for
the benefit of the Borrower. Accrued interest and accrued fees shall be paid to
the Purchasing Lender at the same time or times provided in the predecessor
Notes and this Agreement.
(d) Register. The Agent shall maintain at its office a copy of each
--------
Transfer Supplement delivered to it and a register (the "Register") for the
recordation of the names and addresses of the Lenders and the Commitment of, and
principal amount of the Loans owing to, each Lender from time to time. The
entries in the Register shall be conclusive absent manifest error and the
Borrower, the Agent
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and the Lenders may treat each person whose name is recorded in the Register as
a Lender hereunder for all purposes of the Agreement. The 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.
(e) Financial and Other Information. The Borrower authorizes the
-------------------------------
Agent and each Lender to disclose to any Participant or Purchasing Lender (each,
a "transferee") and any prospective transferee any and all financial and other
information in such Person's possession concerning any Loan Party and their
respective Subsidiaries and affiliates which has been or may be delivered to
such Person by or on behalf of any Loan Party in connection with this Agreement
or any other Loan Document or such Person's credit evaluation of any Loan Party
and their respective Subsidiaries and affiliates. At the request of any Lender,
the Borrower shall provide (to the extent such documents are not available from
the transferor Lender or the Agent) to each prospective transferee conformed
copies of the documents referred to in Section 4 of the form of Transfer
Supplement.
(f) Assignments to Federal Reserve Bank. Any Lender may at any time
-----------------------------------
assign all or any portion of its rights under this Agreement, including without
limitation any Loans owing to it, and any Note held by it to a Federal Reserve
Bank. No such assignment shall relieve the transferor Lender from its
obligations hereunder. Assignments pursuant to this Section 10.14(f) shall not
require the payment of the processing and recording fee specified in Section
10.14(c) hereof.
10.15. GOVERNING LAW; SUBMISSION TO JURISDICTION: WAIVER OF JURY
----------------------------------------------------------
TRIAL; LIMITATION OF LIABILITY.
- ------------------------------
(a) GOVERNING LAW. THIS AGREEMENT AND ALL OTHER LOAN DOCUMENTS
-------------
(EXCEPT TO THE EXTENT, IF ANY, OTHERWISE EXPRESSLY STATED IN SUCH OTHER LOAN
DOCUMENTS) SHALL BE GOVERNED BY, CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE
LAWS OF THE COMMONWEALTH OF PENNSYLVANIA, WITHOUT REGARD TO CHOICE OF LAW
PRINCIPLES.
(b) CERTAIN WAIVERS. EACH OF THE BORROWER, THE LENDERS, THE ISSUING
---------------
BANK AND THE AGENT HEREBY IRREVOCABLY AND UNCONDITIONALLY:
(i) AGREES THAT ANY ACTION, SUIT OR PROCEEDING BY ANY PERSON ARISING
FROM OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT OR ANY
STATEMENT, COURSE OF CONDUCT, ACT, OMISSION, OR EVENT OCCURRING IN
CONNECTION HEREWITH OR THEREWITH (COLLECTIVELY, "RELATED LITIGATION") MAY
BE BROUGHT IN ANY STATE OR FEDERAL COURT OF COMPETENT JURISDICTION SITTING
IN ALLEGHENY COUNTY, PENNSYLVANIA, SUBMITS TO THE JURISDICTION OF SUCH
COURTS, AND TO THE FULLEST EXTENT PERMITTED BY LAW AGREES THAT IT WILL NOT
BRING ANY RELATED LITIGATION IN ANY OTHER FORUM);
(ii) WAIVES ANY OBJECTION WHICH IT MAY HAVE AT ANY TIME TO THE LAYING
OF VENUE OF ANY RELATED LITIGATION BROUGHT IN ANY SUCH COURT, WAIVES ANY
CLAIM THAT ANY SUCH RELATED LITIGATION HAS BEEN BROUGHT IN AN INCONVENIENT
FORUM, AND WAIVES ANY RIGHT TO OBJECT, WITH RESPECT TO ANY RELATED
LITIGATION BROUGHT IN ANY SUCH COURT, THAT SUCH COURT DOES NOT HAVE
JURISDICTION OVER THE BORROWER;
(iii) CONSENTS AND AGREES TO SERVICE OF ANY SUMMONS, COMPLAINT OR
OTHER LEGAL PROCESS IN ANY RELATED LITIGATION BY REGISTERED OR CERTIFIED
U.S. MAIL, POSTAGE PREPAID, TO THE PARTIES
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<PAGE>
IN ACCORDANCE WITH SECTION 9.05 HEREOF, AND CONSENTS AND AGREES THAT SUCH
SERVICE SHALL CONSTITUTE IN EVERY RESPECT VALID AND EFFECTIVE SERVICE (BUT
NOTHING HEREIN SHALL AFFECT THE VALIDITY OR EFFECTIVENESS OF PROCESS SERVED
IN ANY OTHER MANNER PERMITTED BY LAW); AND
(iv) WAIVES THE RIGHT TO TRIAL BY JURY IN ANY RELATED LITIGATION.
(C) LIMITATION OF LIABILITY. TO THE FULLEST EXTENT PERMITTED BY LAW,
-----------------------
NO CLAIM MAY BE MADE BY THE BORROWER AGAINST THE AGENT, ANY LENDER OR ANY
AFFILIATE, DIRECTOR, OFFICER, EMPLOYEE, ATTORNEY OR AGENT OF ANY OF THEM FOR ANY
PUNITIVE DAMAGES IN RESPECT OF ANY CLAIM ARISING FROM OR RELATING TO THIS
AGREEMENT OR ANY OTHER LOAN DOCUMENT OR ANY STATEMENT, COURSE OF CONDUCT, ACT,
OMISSION, OR EVENT OCCURRING IN CONNECTION HEREWITH OR THEREWITH (WHETHER FOR
BREACH OF CONTRACT, TORT OR ANY OTHER THEORY OF LIABILITY). THE BORROWER HEREBY
WAIVES, RELEASES AND AGREES NOT TO SUE UPON ANY CLAIM FOR ANY SUCH DAMAGES,
WHETHER SUCH CLAIM PRESENTLY EXISTS OR ARISES HEREAFTER AND WHETHER OR NOT SUCH
CLAIM IS KNOWN OR SUSPECTED TO EXIST IN ITS FAVOR.
10.16. Confidentiality. Except as otherwise provided in Section
---------------
10.14(e) hereof, the Agent, the Issuing Bank and each of the Lenders agrees to
keep confidential (and to cause its respective officers, directors and employees
to keep confidential and to use its commercially reasonable efforts to cause its
respective agents and representatives to keep confidential) the Information and
all copies thereof, extracts therefrom and analyses or other materials based
thereon, except that each of the Agent, the Issuing Bank and any Lender shall be
permitted to disclose Information (a) to such of its respective officers,
directors, employees, affiliates, agents and representatives as need to know
such Information, (b) to the extent requested by any Governmental Authority, (c)
to the extent otherwise required by applicable Laws or by any subpoena or
similar legal process, (d) to prospective Purchasing Lenders (who agree to be
bound by this Section 10.16), (e) in any legal proceeding between the Borrower
and the Agent or any Lender or (f) to the extent such Information (i) becomes
publicly available other than as a result of a breach of this Agreement or (ii)
becomes available to the Agent, the Issuing Bank or any Lender on a non-
confidential basis from a source other than the Borrower. For the purposes of
this Section 10.16, the term "Information" shall mean all financial statements,
certificates, reports, agreements and information (including all analyses,
compilations and studies prepared by the Agent, the Issuing Bank or any Lender
based on any of the foregoing) that are received from the Borrower and relate to
the Borrower or its Subsidiaries, any shareholder of the Borrower or any
employee, customer or supplier of the Borrower or its Subsidiaries and which
are, in the case of Information provided after the Closing Date, clearly
identified at the time of delivery as confidential, other than any of the
foregoing that were available to the Agent, the Issuing Bank or any Lender on a
nonconfidential basis prior to its disclosure thereto by the Borrower. The
provisions of this Section 10.16 shall remain operative and in full force and
effect regardless of the expiration and term of this Agreement.
10.17. Rights and Obligations of Mellon Under Standby Bond Purchase
------------------------------------------------------------
Agreement. Nothing contained herein shall affect or restrict the rights and
- ---------
obligations of Mellon under the Standby Bond Purchase Agreement. Without
limiting the generality of the foregoing, each party hereto acknowledges (a) the
obligation of Mellon, individually and not as Agent or a Lender hereunder, to
purchase the Bonds under certain circumstances as provided in the Standby Bond
Purchase Agreement; and (b) that any amounts Mellon may collect as a result of
or upon the exercise of its remedies under the
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<PAGE>
Standby Bond Purchase Agreement shall be for Mellon's account and shall not be
subject to Section 10.13 hereof; provided, that the foregoing shall not affect
--------
the obligations of Mellon as Agent and Lender hereunder with respect to any
Letter of Credit issued as credit enhancement for the IDA Facility.
IN WITNESS WHEREOF, the parties hereto, by their officers thereunto
duly authorized, have executed and delivered this Agreement as of the date first
above written.
ATTEST: BUSH INDUSTRIES, INC.
By /s/ Cynthia H. Peterson By /s/ Robert L. Ayres
------------------------- ----------------------------------
Title: Title:
[Corporate Seal]
Address for Notices:
One Mason Drive
P.O. Box 460
Jamestown, NY 14702-0460
Attn: Robert L. Ayres
With a copy to Neil A. Frederick
Telephone: (716) 665-2000
Telex:
(Answerback: )
Telecopier: (716) 665-1192 (Mr. Ayres)
(716) 488-2128 (Mr. Frederick)
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<PAGE>
MELLON BANK, N.A., individually and
as Agent
By /s/ Michael T. Anselmo
---------------------------------------
Title: A.V.P.
Initial Revolving Credit
Committed Amount: $30,000,000
Commitment Percentage: 40.0000000000000%
Address for Notices:
Two Mellon Bank Center
Room 152-230
Pittsburgh, PA 15259-0001
Attn: Michael T. Anselmo
Telephone: (412) 234-0892
Telex:
(Answerback: )
Telecopier: (412) 234-9010
BRANCH BANKING AND TRUST COMPANY
By
---------------------------------------
Title:
Initial Revolving Credit
Committed Amount: $10,000,000
Commitment Percentage: 13.3333333333333%
Address for Notices:
645 N. Main Street
P.O. Box 5249
High Point, NC 27262
Attn: Hoyt W. Almond
Telephone: (910) 889-1130
Telex:
(Answerback: )
Telecopier: (910) 841-8455
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<PAGE>
THE CHASE MANHATTAN BANK, N.A.
By /s/ Fred Loder
---------------------------------------
Title: Vice President
Initial Revolving Credit
Committed Amount: $15,000,000
Commitment Percentage: 20.0000000000000%
Address for Notices:
2-12 East Third Street
Jamestown, NY 14701
Attn: Fred Loder
Telephone: (716) 483-4895
Telex:
(Answerback: )
Telecopier: (716) 483-4995
CHEMICAL BANK
By /s/ Robert J. McArdle
---------------------------------------
Title: Vice President
Initial Revolving Credit
Committed Amount: $20,000,000
Commitment Percentage: 26.6666666666666%
Address for Notices:
2300 Main Place Tower
Buffalo, NY 14202
Attn: Robert J. McArdle
Telephone: (716) 858-1418
Telex:
(Answerback: )
Telecopier: (716) 843-4939
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<PAGE>
Exhibit 10.2
Omitted Exhibits and Schedules to Credit Agreement
The following Exhibits and Schedules have been omitted from
Exhibit 10.1 (Credit Agreement). The Registrant will furnish supplementally a
copy of any omitted Exhibit and/or Schedule to the Credit Agreement (Exhibit
10.1 to this Form 8-K) to the Securities and Exchange Commission upon request:
Exhibit A Form of Revolving Credit Note
Exhibit B-1 Form of Standby Letter of Credit Application
Exhibit B-2 Form of Merchandise Letter of Credit Application
Exhibit B-3 Form of Letter of Credit Agreement
Exhibit C Form of Opinion of Counsel to the Borrower
Exhibit D Form of Quarterly Compliance Certificate
Exhibit E Form of Significant Subsidiary Guaranty
Exhibit F Form of Transfer Supplement
Exhibit G Form of Payoff Letter for Asset Based Lending Facility
Schedule 3.01(g) Prior Letters of Credit
Schedule 4.01 Corporate Status
Schedule 4.04 Governmental Approvals and Filings
Schedule 4.05 Absence of Conflicts
Schedule 4.09 Absence of Undisclosed Liabilities
Schedule 4.10 Material Adverse Changes
Schedule 4.16 Subsidiaries
Schedule 4.17 Partnerships, etc.
Schedule 4.18 Ownership and Control
Schedule 4.19 Litigation
Schedule 4.21 Absence of Other Conflicts
Schedule 4.22 Insurance
Schedule 4.25 Taxes
Schedule 4.26 Employee Benefits
Schedule 4.27 Environmental Matters
Schedule 6.13 Certain Indebtedness to be Repaid
Schedule 7.02 Permitted Liens
Schedule 7.03 Permitted Indebtedness
Schedule 7.04 Permitted Guaranties, Indemnities, etc.
Schedule 7.05 Permitted Loans, Advances and Investments
Schedule 7.12 Permitted Dealings with Affiliates
Schedule 7.18 Agreements Containing Restrictions on Amendment of
Loan Documents
