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FORM 8-K
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported):
September 5, 1997
Commission File No.: 0-14685
GENICOM CORPORATION
(Exact name of registrant as specified in its charter)
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<S> <C>
DELAWARE 51 - 0271821
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
14800 CONFERENCE CENTER DRIVE
SUITE 400, WESTFIELDS
CHANTILLY, VIRGINIA 20151
(Address of principal executive (Zip Code)
offices)
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Registrant's telephone number, including area code: (703) 802-9200
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GENICOM CORPORATION AND SUBSIDIARIES
FORM 8-K INDEX
Item 5. Other Items
On September 5, 1997, the registrant executed an amended and
restated credit agreement with a syndicate of lenders led by
NationsBank which provides $110 million in credit
facilities, an increase of $30 million over the previous
facilities with the syndicate. Part of the proceeds from
the credit facilities were used to retire a $9 million note
held by Texas Instruments due in September of 1998. A copy
of the credit agreement and the press release is filed
herewith.
Item 7. Financial Statements and Exhibits
(c) Exhibits
10.1 Amended and restated credit agreement with
Nationsbank dated September 5, 1997
99.1 Press release dated September 9, 1997, published by the
Registrant
Signatures 3
2
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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 thereunto duly authorized.
GENICOM Corporation
---------------------------------------
Registrant
Date: September 22, 1997
/s/James C. Gale
---------------------------------------
Signature
James C. Gale
Senior Vice President Finance and
Chief Financial Officer
(Mr. Gale is the Chief Financial
Officer and has been duly
authorized to sign on behalf of
the Registrant)
3
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Exhibit 10.1
AMENDED AND RESTATED CREDIT AGREEMENT
Dated as of September 5, 1997
among
GENICOM CORPORATION,
as Borrower,
THE SUBSIDIARIES OF THE BORROWER
FROM TIME TO TIME PARTY HERETO,
as Guarantors,
THE SEVERAL LENDERS
FROM TIME TO TIME PARTY HERETO
AND
NATIONSBANK OF TEXAS, N.A.,
as Agent
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TABLE OF CONTENTS
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SECTION 1 DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
-----------
1.1 Definitions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
-----------
1.2 Computation of Time Periods. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
---------------------------
1.3 Accounting Terms. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
----------------
SECTION 2 CREDIT FACILITIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
-----------------
2.1 Revolving Loans. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
---------------
2.2 Letter of Credit Subfacility. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
----------------------------
2.3 Swingline Loan Subfacility. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
--------------------------
2.4 Foreign Currency Loan Subfacility. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
---------------------------------
2.5 Tranche A Term Loan. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
-------------------
2.6 Tranche B Term Loan. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
-------------------
SECTION 3 OTHER PROVISIONS RELATING TO CREDIT FACILITIES . . . . . . . . . . . . . . . . . . . . . . . . . 43
----------------------------------------------
3.1 Default Rate. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
------------
3.2 Extension and Conversion. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
------------------------
3.3 Prepayments. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
-----------
3.4 Termination and Reduction of Committed Amounts; Increase of Commitment. . . . . . . . . . . . 46
----------------------------------------------------------------------
3.5 Fees. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
----
3.6 Eurocurrency Reserve Compensation. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
---------------------------------
3.7 Capital Adequacy. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
----------------
3.8 Unavailability. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
--------------
3.9 Illegality. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
----------
3.10 Requirements of Law. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
-------------------
3.11 Taxes. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
-----
3.12 Indemnity. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54
---------
3.13 Pro Rata Treatment. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54
------------------
3.14 Sharing of Payments. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
-------------------
3.15 Payments, Computations, Etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56
---------------------------
3.16 Evidence of Debt. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58
----------------
SECTION 4 GUARANTY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59
--------
4.1 The Guarantee. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59
-------------
4.2 Obligations Unconditional. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60
-------------------------
4.3 Reinstatement. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
-------------
4.4 Certain Additional Waivers. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
--------------------------
4.5 Remedies. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
--------
4.6 Rights of Contribution. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
----------------------
4.7 Continuing Guarantee. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
--------------------
SECTION 5 CONDITIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
----------
5.1 Closing Conditions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
------------------
5.2 Conditions to all Extensions of Credit. . . . . . . . . . . . . . . . . . . . . . . . . . . . 64
--------------------------------------
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SECTION 6 REPRESENTATIONS AND WARRANTIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 65
------------------------------
6.1 Financial Condition. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 65
-------------------
6.2 No Change. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 66
---------
6.3 Organization; Existence; Compliance with Law. . . . . . . . . . . . . . . . . . . . . . . . . 66
--------------------------------------------
6.4 Power; Authorization; Enforceable Obligations. . . . . . . . . . . . . . . . . . . . . . . . . 67
---------------------------------------------
6.5 No Legal Bar. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 67
------------
6.6 No Material Litigation. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 68
----------------------
6.7 No Default. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 68
----------
6.8 Ownership of Property; Liens. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 68
----------------------------
6.9 Intellectual Property. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 68
---------------------
6.10 No Burdensome Restrictions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 68
--------------------------
6.11 Taxes. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 68
-----
6.12 ERISA. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 69
-----
6.13 Governmental Regulations, etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 70
-----------------------------
6.14 Subsidiaries. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 71
------------
6.15 Purpose of Loans and Letters of Credit. . . . . . . . . . . . . . . . . . . . . . . . . . . . 72
--------------------------------------
6.16 Environmental Matters. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 72
---------------------
SECTION 7 AFFIRMATIVE COVENANTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 73
---------------------
7.1 Information Covenants. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 73
---------------------
7.2 Preservation of Existence and Franchises. . . . . . . . . . . . . . . . . . . . . . . . . . . 77
----------------------------------------
7.3 Books and Records. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 77
-----------------
7.4 Compliance with Law. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 77
-------------------
7.5 Payment of Taxes and Other Indebtedness. . . . . . . . . . . . . . . . . . . . . . . . . . . . 77
---------------------------------------
7.6 Insurance. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 77
---------
7.7 Maintenance of Property. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 78
-----------------------
7.8 Performance of Obligations. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 78
--------------------------
7.9 Use of Proceeds. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 78
---------------
7.10 Audits/Inspections. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 78
------------------
7.11 Financial Covenants. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 78
-------------------
7.12 Additional Credit Parties. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 81
-------------------------
7.13 Pledged Assets. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 82
--------------
7.14 Interest Rate Protection Agreements. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 82
-----------------------------------
7.15 Ownership of Subsidiaries; Domestic Operations. . . . . . . . . . . . . . . . . . . . . . . . 82
----------------------------------------------
SECTION 8 NEGATIVE COVENANTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 83
------------------
8.1 Indebtedness. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 83
------------
8.2 Liens. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 84
------
8.3 Nature of Business. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 84
------------------
8.4 Consolidation, Merger, Sale or Purchase of Assets, etc. . . . . . . . . . . . . . . . . . . . 84
------------------------------------------------------
8.5 Advances, Investments, Loans, etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 86
---------------------------------
8.6 Restricted Payments. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 86
-------------------
8.7 Prepayments of Indebtedness, etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 86
--------------------------------
8.8 Transactions with Affiliates. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 87
----------------------------
8.9 Fiscal Year. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 87
-----------
8.10 Limitation on Restrictions on Subsidiary Dividends and Other Distributions, etc. . . . . . . 87
-------------------------------------------------------------------------------
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8.11 Issuance and Sale of Subsidiary Stock. . . . . . . . . . . . . . . . . . . . . . . . . . . . 88
-------------------------------------
8.12 Sale Leasebacks. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 88
---------------
8.13 No Further Negative Pledges. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 88
---------------------------
8.14 Operating Lease Obligations. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 88
---------------------------
SECTION 9 EVENTS OF DEFAULT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 88
-----------------
9.1 Events of Default. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 88
-----------------
9.2 Acceleration; Remedies. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 91
----------------------
SECTION 10 AGENCY PROVISIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 92
-----------------
10.1 Appointment. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 92
-----------
10.2 Delegation of Duties. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 92
--------------------
10.3 Exculpatory Provisions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 92
----------------------
10.4 Reliance on Communications. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 93
--------------------------
10.5 Notice of Default. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 93
-----------------
10.6 Non-Reliance on Agent and Other Lenders. . . . . . . . . . . . . . . . . . . . . . . . . . . 94
---------------------------------------
10.7 Indemnification. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 94
---------------
10.8 Agent in its Individual Capacity. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 95
--------------------------------
10.9 Successor Agent. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 95
---------------
SECTION 11 MISCELLANEOUS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 95
-------------
11.1 Notices. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 95
-------
11.2 Right of Set-Off. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 96
----------------
11.3 Benefit of Agreement. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 97
--------------------
11.4 No Waiver; Remedies Cumulative. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 99
------------------------------
11.5 Payment of Expenses, etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 100
------------------------
11.6 Amendments, Waivers and Consents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 100
--------------------------------
11.7 Counterparts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 101
------------
11.8 Headings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 101
--------
11.9 Survival . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 101
11.10 Governing Law; Submission to Jurisdiction; Venue. . . . . . . . . . . . . . . . . . . . . 101
11.11 Severability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 102
------------
11.12 Entirety. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 102
--------
11.13 Binding Effect; Termination of this Credit Agreement; Termination of Existing
------------------------------------------------------------------------------
Credit Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 103
-----------------
11.14 Judgment Currency . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 103
-----------------
11.15 Confidentiality . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 104
---------------
11.16 Source of Funds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 104
---------------
11.17 Conflict . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 105
--------
</TABLE>
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SCHEDULES
Schedule 1.1A Investments
Schedule 1.1B Liens
Schedule 1.1C Form of Pledge Agreement
Schedule 1.1D Form of Security Agreement
Schedule 1.1E-1 Form of U.K. Security Agreement -
Genicom Corporation
Schedule 1.1E-2 Form of U.K. Security Agreement -
Genicom Ltd.
Schedule 2.1(a) Lenders, Commitments and Commitment Percentages
Schedule 2.1(b)(i) Form of Notice of Borrowing
Schedule 2.1(e) Form of Revolving Note
Schedule 2.3(d) Form of Swingline Note
Schedule 2.4(e) Form of Foreign Currency Note
Schedule 2.5(e) Form of Tranche A Term Note
Schedule 2.6(f) Form of Tranche B Term Note
Schedule 3.2 Form of Notice of Extension/Conversion
Schedule 3.4 Form of New Commitment Agreement
Schedule 5.1(d) Form of Legal Opinion of McGuire, Woods, Battle & Boothe
Schedule 5.1(e) Form of Opinion of Berwin Leighton
Schedule 6.4 Required Consents, Authorizations, Notices
and Filings
Schedule 6.6 Litigation
Schedule 6.12 ERISA
Schedule 6.14 Subsidiaries
Schedule 6.16 Environmental Disclosures
Schedule 7.1(c) Form of Officer's Compliance Certificate
Schedule 7.1(e) Form of Borrowing Base Certificate
Schedule 7.12 Form of Joinder Agreement
Schedule 8.1 Indebtedness
Schedule 8.8 Affiliate Transactions
Schedule 11.3 Form of Assignment and Acceptance
iv
<PAGE> 6
AMENDED AND RESTATED CREDIT AGREEMENT
THIS AMENDED AND RESTATED CREDIT AGREEMENT dated as of September 5,
1997 (the "Credit Agreement"), is by and among GENICOM CORPORATION, a Delaware
corporation (the "Borrower"), the subsidiaries of the Borrower identified on
the signature pages hereto and such other subsidiaries of the Borrower as may
from time to time become a party hereto (the "Guarantors"), the several lenders
identified on the signature pages hereto and such other lenders as may from
time to time become a party hereto (the "Lenders") and NATIONSBANK OF TEXAS,
N.A., as agent for the Lenders (in such capacity, the "Agent").
W I T N E S S E T H
WHEREAS, the Borrower has requested that the Lenders provide a
$110,000,000 credit facility for the purposes hereinafter set forth;
WHEREAS, the Lenders have agreed to make the requested credit facility
available to the Borrower on the terms and conditions hereinafter set forth;
NOW, THEREFORE, IN CONSIDERATION of the premises and other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties hereto agree as follows:
SECTION 1
DEFINITIONS
1.1 DEFINITIONS.
As used in this Credit Agreement, the following terms shall have the
meanings specified below unless the context otherwise requires:
"Acquisition", by any Person (herein called the "Acquiror"),
means any transaction involving the purchase, lease or other
acquisition by such Acquiror of any or all of the Capital Stock or
Property of another Person (herein called the "Target") (whether or
not involving a merger or consolidation with such Target) that, for
purposes of preparing a statement of cash flows for such Acquiror
prepared in accordance with GAAP, would be considered "investing
activity".
"Additional Commitment" means, with respect to any Lender
which executes a New Commitment Agreement in accordance with Section
3.4, the commitment of such Lender in an aggregate principal amount up
to the amount specified in such New Commitment Agreement (i) to make
Revolving Loans in accordance with the provisions
<PAGE> 7
of Section 2.1(a), (ii) to purchase participation interests in Letters
of Credit in accordance with the provisions of Section 2.2(c), (iii)
to purchase participation interests in the Swingline Loans in
accordance with the provisions of Section 2.3(b)(iii) and (iv) to make
Foreign Currency Loans in accordance with the provisions of Section
2.4(a).
"Additional Credit Party" means each Person that becomes a
Guarantor after the Closing Date by execution of a Joinder Agreement.
"Affiliate" means, with respect to any Person, any other
Person (i) directly or indirectly controlling or controlled by or
under direct or indirect common control with such Person or (ii)
directly or indirectly owning or holding five percent (5%) or more of
the equity interest in such Person. For purposes of this definition,
"control" when used with respect to any Person means the power to
direct the management and policies of such Person, directly or
indirectly, whether through the ownership of voting securities, by
contract or otherwise; and the terms "controlling" and "controlled"
have meanings correlative to the foregoing.
"Agency Services Address" means NationsBank of Texas, N.A.,
901 Main Street, Floor 13, Dallas, Texas 75202 Attn: Agency
Services, or such other address as may be identified by written notice
from the Agent to the Borrower.
"Agent" shall have the meaning assigned to such term in the
heading hereof.
"Agent's Fee Letter" means that certain letter agreement,
dated as of August 8, 1997, between the Agent and the Borrower, as
amended, modified, supplemented or replaced from time to time.
"Agent's Fees" shall have the meaning assigned to such term in
Section 3.5(c).
"Alternative Assets" means, in connection with any proposed
Asset Disposition pursuant to the terms of Section 8.4(b)(v), fixed
assets (whether new, additional or replacement assets but exclusive of
assets acquired in the course of regular upkeep and maintenance) which
are similar in nature or purpose to other assets owned or leased by
the Borrower and/or its Subsidiaries prior to or at the time of the
acquisition of such fixed assets and useful in the conduct of the
business of the Borrower and its Subsidiaries as permitted to be
conducted pursuant to Section 8.3.
"Applicable Percentage" means, for purposes of calculating the
applicable interest rate for any day for any Eurodollar Loan which is
a Revolving Loan, Tranche A Term Loan, Tranche B Term Loan or Foreign
Currency Loan or for any Base Rate Loan which is a Revolving Loan,
Tranche A Term Loan or Tranche B Term Loan, the applicable rate of the
Unused Fee for any day for purposes of Section 3.5(a) or the
applicable rate of the Standby Letter of Credit Fee for any day for
purposes of Section 3.5(b)(i), the appropriate applicable percentage
corresponding to the Consolidated Funded Debt Coverage Ratio in effect
as of the most recent Calculation Date:
2
<PAGE> 8
<TABLE>
<CAPTION>
====================================================================================================================================
Applicable
Applicable Percentage for
Percentage for Base Rate
Eurodollar Loans which are Applicable Applicable
Loans which are Revolving Percentage for Percentage for
Consolidated Revolving Loans, Loans, Eurodollar Base Rate Applicable Applicable
Funded Debt Tranche A Term Swingline Loans Loans which Loans which are Percentage for Percentage
Pricing Coverage Loans or Foreign or Tranche A are Tranche B Tranche B Term Standby Letter for Unused
Level Ratio Currency Loans Term Loans Term Loans Loans of Credit Fee Fee
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
I Greater than 3.00% 1.75% 3.50% 2.25% 3.00% 0.50%
or equal to
4.50 to 1.00
- ------------------------------------------------------------------------------------------------------------------------------------
II Greater than 2.75% 1.50% 3.25% 2.00% 2.75% 0.50%
or equal to
3.50 to 1.00
but less than
4.50 to 1.00
- ------------------------------------------------------------------------------------------------------------------------------------
III Greater than 2.50% 1.25% 3.00% 1.75% 2.50% 0.50%
or equal to
3.00 to 1.00
but less than
3.50 to 1.00
- ------------------------------------------------------------------------------------------------------------------------------------
IV Greater than 2.25% 1.00% 3.00% 1.75% 2.25% 0.50%
or equal to
2.50 to 1.00
but less than
3.00 to 1.00
- ------------------------------------------------------------------------------------------------------------------------------------
V Greater than 2.00% 0.75% 3.00% 1.75% 2.00% 0.375%
or equal to
2.00 to 1.00
but less than
2.50 to 1.00
- ------------------------------------------------------------------------------------------------------------------------------------
VI Less than 2.00 1.75% 0.50% 3.00% 1.75% 1.75% 0.375%
to 1.00
====================================================================================================================================
</TABLE>
The initial Applicable Percentages shall be based on Pricing Level II
until the first Applicable Percentage Change Date for the Calculation
Date occurring on September 28, 1997. Thereafter, determination of
the appropriate Applicable Percentages based on the Consolidated
Funded Debt Coverage Ratio shall be made on each Calculation Date upon
receipt by the Agent at the Agency Services Address of the Required
Financial Information for such Calculation Date. The Consolidated
Funded Debt Coverage Ratio in effect as of a Calculation Date shall
establish the Applicable Percentages that shall be effective as of the
date designated by the Agent as the Applicable Percentage Change Date.
The Agent shall determine the Applicable Percentages as of the
Calculation Date occurring on September 28, 1997 and on each
Calculation Date thereafter and shall promptly notify the Borrower and
the Lenders of the Applicable Percentages so determined and of the
Applicable Percentage Change Date. Such determinations by the Agent
of the Applicable Percentages shall be conclusive absent demonstrable
error. If the Borrower fails to provide the Required Financial
Information for a Calculation Date to the Agent at the Agency Services
Address, the Applicable Percentages shall be based on Pricing Level I
until such time as the Required Financial Information is provided
whereupon the Pricing Level shall be determined by the then current
Consolidated Funded Debt Coverage Ratio.
"Applicable Percentage Change Date" means, with respect to the
Calculation Date occurring on September 28, 1997 and any Calculation
Date thereafter, a date designated by the Agent that is not more than
five (5) Business Days after receipt by the Agent at the Agency
Services Address of the Required Financial Information for such
Calculation Date.
"Application Period" means with respect to any Asset
Disposition made pursuant to Section 8.4(b)(v), (i) if the Net
Proceeds received in connection with such Asset
3
<PAGE> 9
Disposition are less than $5,000,000, the 120 day period following the
end of the fiscal year during which such Asset Disposition occurred or
(ii) if the Net Proceeds received in connection with such Asset
Disposition are equal to or greater than $5,000,000, the 60 day period
following the consummation of such Asset Disposition.
"Asset Disposition" means any sale, lease, transfer or other
disposition (including any such transaction effected by way of merger,
amalgamation or consolidation) by the Borrower or any of its
Subsidiaries subsequent to the Closing Date of any asset (including
stock in Subsidiaries), including without limitation any sale
leaseback transaction (whether or not involving a Capital Lease), but
excluding (a) the sale of inventory in the ordinary course of business
for fair consideration, (b) the sale or disposition of machinery and
equipment no longer used or useful in the conduct of such Person's
business, (c) the sale or other disposition of the TIWP Assets in
accordance with the terms of Section 8.4(b)(iii) and (d) any Equity
Transaction.
"Asset Disposition Prepayment Event" means, with respect to
any Asset Disposition made pursuant to the terms of Section 8.4(b)(v),
the failure of the Borrower to apply (or cause its applicable
Subsidiary to apply) an amount equal to the Net Proceeds of such Asset
Disposition to the purchase, acquisition or construction of
Alternative Assets during the Application Period for such Asset
Disposition.
"Available Foreign Currency" means (i) British Pounds
Sterling, French Francs, Deutsche Marks, Japanese Yen, Italian Lira
and Canadian Dollars and (ii) any other freely available currency
which is freely transferrable and freely convertible into Dollars and
in which dealings in deposits are carried on in the London interbank
market, which shall be requested by the Borrower and approved by each
Lender.
"Bankruptcy Code" means the Bankruptcy Code in Title 11 of the
United States Code, as amended, modified, succeeded or replaced from
time to time.
"Bankruptcy Event" means, with respect to any Person, the
occurrence of any of the following with respect to such Person: (i) a
court or governmental agency having jurisdiction in the premises shall
enter a decree or order for relief in respect of such Person in an
involuntary case under any applicable bankruptcy, insolvency or other
similar law now or hereafter in effect, or appointing a receiver,
liquidator, assignee, custodian, trustee, sequestrator (or similar
official) of such Person or for any substantial part of its Property
or ordering the winding up or liquidation of its affairs; or (ii)
there shall be commenced against such Person an involuntary case under
any applicable bankruptcy, insolvency or other similar law now or
hereafter in effect, or any case, proceeding or other action for the
appointment of a receiver, liquidator, assignee, custodian, trustee,
sequestrator (or similar official) of such Person or for any
substantial part of its Property or for the winding up or liquidation
of its affairs, and such involuntary case or other case, proceeding or
other action shall remain undismissed, undischarged or unbonded for a
period of sixty (60) consecutive days; or (iii) such Person shall
commence a voluntary case under any applicable bankruptcy, insolvency
or other similar law now or hereafter in effect, or
4
<PAGE> 10
consent to the entry of an order for relief in an involuntary case
under any such law, or consent to the appointment or taking possession
by a receiver, liquidator, assignee, custodian, trustee, sequestrator
(or similar official) of such Person or for any substantial part of
its Property or make any general assignment for the benefit of
creditors; or (iv) such Person shall be unable to, or shall admit in
writing its inability to, pay its debts generally as they become due.
"Base Rate" means, for any day, the rate per annum (rounded
upwards, if necessary, to the nearest whole multiple of 1/100 of 1%)
equal to the greater of (a) the Federal Funds Rate in effect on such
day plus 1/2 of 1% or (b) the Prime Rate in effect on such day. If
for any reason the Agent shall have determined (which determination
shall be conclusive absent manifest error) that it is unable after due
inquiry to ascertain the Federal Funds Rate for any reason, including
the inability or failure of the Agent to obtain sufficient quotations
in accordance with the terms hereof, the Base Rate shall be determined
without regard to clause (a) of the first sentence of this definition
until the circumstances giving rise to such inability no longer exist.
Any change in the Base Rate due to a change in the Prime Rate or the
Federal Funds Rate shall be effective on the effective date of such
change in the Prime Rate or the Federal Funds Rate, respectively.
"Base Rate Loan" means any Loan bearing interest at a rate
determined by reference to the Base Rate.
"Borrower" means the Person identified as such in the heading
hereof, together with any permitted successors and assigns.
"Borrower's Obligations" means, without duplication, (i) all
of the obligations of the Borrower to the Lenders (including the
Issuing Lender and the Swingline Lender) and the Agent, whenever
arising, under this Credit Agreement, the Notes or any of the other
Credit Documents and (ii) all liabilities and obligations, whenever
arising, owing from the Borrower to any Lender or any affiliate of a
Lender arising under interest rate protection agreements, foreign
currency exchange agreements, commodity purchase or option agreements
or other interest or exchange rate or commodity price hedging
agreements.
"Borrowing Base" means, as of any day, the sum of (a) 80% of
Eligible Receivables and (b) 40% of Eligible Inventory, in each case
as set forth in the most recent Borrowing Base Report delivered to the
Agent and the Lenders in accordance with the terms of Section 7.1(e);
provided, however, that the amount determined pursuant to clause (b)
above shall not exceed 50% of the total Borrowing Base.
"Business Day" means a day other than a Saturday, Sunday or
other day on which commercial banks in Dallas, Texas are authorized or
required by law to close, except that, (i) when used in connection
with a Eurodollar Loan, such day shall also be a day on which dealings
between banks are carried on in U.S. dollar deposits in London,
England and New York, New York and (ii) when used in connection with a
Foreign Currency Loan,
5
<PAGE> 11
such day shall also be a day on which dealings in the applicable
Available Foreign Currency are being carried on in the interbank
eurocurrency market.
"Calculation Date" means the last day of each fiscal quarter
of the Borrower.
"Capital Lease" means, as applied to any Person, any lease of
any Property (whether real, personal or mixed) by that Person as
lessee which, in accordance with GAAP is or should be accounted for as
a capital lease on the balance sheet of that Person.
"Capital Stock" means (i) in the case of a corporation,
capital stock, (ii) in the case of an association or business entity,
any and all shares, interests, participations, rights or other
equivalents (however designated) of capital stock, (iii) in the case
of a partnership, partnership interests (whether general or limited),
(iv) in the case of a limited liability company, membership interests
and (v) any other interest or participation that confers on a Person
the right to receive a share of the profits and losses of, or
distributions of assets of, the issuing Person.
"Cash Equivalents" means (a) securities issued or directly and
fully guaranteed or insured by the United States of America or any
agency or instrumentality thereof (provided that the full faith and
credit of the United States of America is pledged in support thereof)
having maturities of not more than twelve months from the date of
acquisition, (b) U.S. dollar denominated time deposits and
certificates of deposit of (i) any Lender or (ii) any domestic
commercial bank of recognized standing (y) having capital and surplus
in excess of $500,000,000 and (z) whose short-term commercial paper
rating from S&P is at least A-1 or the equivalent thereof or from
Moody's is at least P-1 or the equivalent thereof (any such bank being
an "Approved Lender"), in each case with maturities of not more than
270 days from the date of acquisition, (c) commercial paper and
variable or fixed rate notes issued by any Approved Lender (or by the
parent company thereof) and maturing within six months of the date of
acquisition, (d) repurchase agreements entered into by a Person with a
bank or trust company (including any of the Lenders) or recognized
securities dealer having capital and surplus in excess of $500,000,000
for direct obligations issued by or fully guaranteed by the United
States of America in which such Person shall have a perfected first
priority security interest (subject to no other Liens) and having, on
the date of purchase thereof, a fair market value of at least 100% of
the amount of the repurchase obligations, (e) obligations of any State
of the United States or any political subdivision thereof, the
interest with respect to which is exempt from federal income taxation
under Section 103 of the Code, having a long term rating of at least
Aa-3 or AA- by Moody's or S&P, respectively, and maturing within three
years from the date of acquisition thereof, (f) Investments in
municipal auction preferred stock (i) rated AAA (or the equivalent
thereof) or better by S&P or Aaa (or the equivalent thereof) or better
by Moody's and (ii) with dividends that reset at least once every 365
days and (g) Investments, classified in accordance with GAAP as
current assets, in money market investment programs registered under
the Investment Company Act of 1940, as amended, which are administered
by reputable financial institutions having capital of at
6
<PAGE> 12
least $100,000,000 and the portfolios of which are limited to
Investments of the character described in the foregoing subdivisions
(a), (b), (c), (e) and (f).
"Change of Control" means the occurrence of any of the
following events: (i) after the Closing Date, any Person or two or
more Persons acting in concert shall have acquired beneficial
ownership, directly or indirectly, of, or shall have acquired by
contract or otherwise, or shall have entered into a contract or
arrangement that, upon consummation, will result in its or their
acquisition of, control over, Voting Stock of the Borrower (or other
securities convertible into such Voting Stock) representing 25% or
more of the combined voting power of all Voting Stock of the Borrower,
or (ii) during any period of up to 24 consecutive months, commencing
after the Closing Date, individuals who at the beginning of such 24
month period were directors of the Borrower (together with any new
director whose election by the Borrower's Board of Directors or whose
nomination for election by the Borrower's shareholders was approved by
a vote of at least two-thirds of the directors then still in office
who either were directors at the beginning of such period or whose
election or nomination for election was previously so approved) cease
for any reason to constitute a majority of the directors of the
Borrower then in office. As used herein, "beneficial ownership" shall
have the meaning provided in Rule 13d-3 of the Securities and Exchange
Commission under the Securities Exchange Act of 1934.
"Closing Date" means the date hereof.
"Code" means the Internal Revenue Code of 1986, as amended,
and any successor thereto, as interpreted by the rules and regulations
issued 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.
"Collateral" means a collective reference to the collateral
which at any time will be covered by the Collateral Documents.
"Collateral Documents" means a collective reference to the
Security Agreement, the Pledge Agreement, the Mortgage Instruments,
the U.K. Security Agreements and such other documents executed and
delivered in connection with the attachment and perfection of the
Agent's security interests and liens arising thereunder, including
without limitation, UCC financing statements.
"Commitment" means (i) with respect to each Lender, the
Revolving Commitment of such Lender, the Tranche A Term Loan
Commitment of such Lender and/or the Tranche B Term Loan Commitment of
such Lender, (ii) with respect to the Swingline Lender, the Swingline
Commitment and (iii) with respect to the Issuing Lender, the LOC
Commitment.
"Consolidated Capital Expenditures" means, for any period, all
capital expenditures (excluding acquisitions permitted by the terms of
Section 8.4(c)) of the
7
<PAGE> 13
Borrower and its Subsidiaries on a consolidated basis for such period,
as determined in accordance with GAAP.
"Consolidated Capitalization" means, at any time, the sum of
(i) Consolidated Net Worth at such time plus (ii) all Funded
Indebtedness of the Borrower and its Subsidiaries on a consolidated
basis at such time.
"Consolidated Cash Taxes" means, for any period, all cash
taxes of the Borrower and its Subsidiaries on a consolidated basis for
such period, as determined in accordance with GAAP.
"Consolidated Debt to Capitalization Ratio" means, as of any
Calculation Date, the ratio of (i) Funded Indebtedness of the Borrower
and its Subsidiaries on a consolidated basis as of such Calculation
Date, to (ii) Consolidated Capitalization as of such Calculation Date.
"Consolidated EBITDA" means, for any period, the sum of (i)
Consolidated Net Income for such period, plus (ii) an amount which, in
the determination of Consolidated Net Income for such period, has been
deducted for (A) Consolidated Interest Expense, (B) total federal,
state, local and foreign income, value added and similar taxes and (C)
depreciation and amortization expense, all as determined in accordance
with GAAP.
"Consolidated Fixed Charge Coverage Ratio" means, as of the
end of any period, the ratio of (i) Consolidated EBITDA for the
applicable period minus Consolidated Capital Expenditures for the
applicable period, to (ii) Consolidated Interest Expense for the
applicable period plus Consolidated Scheduled Funded Indebtedness
Payments for the applicable period plus Restricted Payments by the
Borrower and its Subsidiaries on a consolidated basis for the
applicable period.
"Consolidated Funded Debt Coverage Ratio" means, as of any
Calculation Date, the ratio of (i) Funded Indebtedness of the Borrower
and its Subsidiaries on a consolidated basis as of such Calculation
Date, to (ii) Consolidated EBITDA for the four-quarter period ended as
of such Calculation Date minus Consolidated Capital Expenditures for
the four-quarter period ended as of such Calculation Date.
"Consolidated Intangible Assets" means, at any time, all
assets of the Borrower and its Subsidiaries on a consolidated basis at
such time consisting of goodwill, patents, tradenames, trademarks,
copyrights, franchises, experimental expense, organization expense,
unamortized debt discount and expense, non-current deferred assets and
such other assets of the Borrower and its Subsidiaries which, in
accordance with GAAP, would be classified as "intangible assets."
"Consolidated Interest Expense" means, for any period,
interest expense of the Borrower and its Subsidiaries on a
consolidated basis for such period, as determined in accordance with
GAAP.
8
<PAGE> 14
"Consolidated Net Income" means, for any period, net income
(excluding extraordinary items) after taxes for such period of the
Borrower and its Subsidiaries on a consolidated basis, as determined
in accordance with GAAP.
"Consolidated Net Worth" means, at any time, total
shareholders' equity of the Borrower and its Subsidiaries on a
consolidated basis at such time, as determined in accordance with GAAP
(but excluding in any event foreign currency translation adjustments).
"Consolidated Scheduled Funded Indebtedness Payments" means,
for any period, the scheduled payments of principal on Funded
Indebtedness for the Borrower and its Subsidiaries on a consolidated
basis for such period.
"Consolidated Tangible Net Worth" means, at any time,
Consolidated Net Worth at such time minus Consolidated Intangible
Assets at such time, provided, however, that foreign currency
translation adjustments and pension liability adjustments shall not be
taken into account in calculating Consolidated Tangible Net Worth.
"Consolidated Total Assets" means, at any time, all items
which, in accordance with GAAP, would be classified at such time as
assets on a consolidated balance sheet of the Borrower and its
Subsidiaries.
"Consolidated Working Capital" means, at any time, with
respect to the Borrower and its Subsidiaries on a consolidated basis,
(a) the sum of inventory (based on a FIFO valuation), current
receivables (including trade receivables and current rent receivables)
and prepaid expenses, minus (b) the sum of accrued expenses currently
payable and trade payables, as each of such items would appear on a
consolidated balance sheet of the Borrower and its Subsidiaries at
such time, as determined in accordance with GAAP.
"Controlled Group" means (i) the controlled group of
corporations as defined in Section 414(b) of the Code and the
applicable regulations thereunder, or (ii) the group of trades or
businesses under common control as defined in Section 414(c) of the
Code and the applicable regulations thereunder, of which the Borrower
or any of its Subsidiaries is a member.
"Credit Documents" means a collective reference to this Credit
Agreement, the Notes, the LOC Documents, each Joinder Agreement, the
Agent's Fee Letter, the Collateral Documents and all other related
agreements and documents issued or delivered hereunder or thereunder
or pursuant hereto or thereto.
"Credit Party" means any of the Borrower and the Guarantors.
"Default" means any event, act or condition which with notice
or lapse of time, or both, would constitute an Event of Default.
9
<PAGE> 15
"Determination Date" means with respect to any Foreign
Currency Loan:
(a) the date two Business Days prior to the date
such Loan is made;
(b) the last Business Day of each month or the
date two Business Days prior to the date such Loan is
continued from the current Interest Period of such Loan into a
subsequent Interest Period or is converted from a Loan in one
Available Foreign Currency into a Loan in another Available
Foreign Currency;
or
(c) the date of any reduction of the Revolving
Committed Amount pursuant to the terms of Section 3.4(a).
"Dollars" and "$" means dollars in lawful currency of the
United States of America.
"Dollar Amount" means (a) with respect to Dollars or an amount
denominated in Dollars, such amount and (b) with respect to an amount
of any Available Foreign Currency or an amount denominated in such
Available Foreign Currency, the Dollar Equivalent of such amount on
the applicable date contemplated in this Credit Agreement.
"Dollar Equivalent" means, on any date, with respect to an
amount denominated in an Available Foreign Currency, the amount of
Dollars into which the Agent could, in accordance with its practice
from time to time in the interbank foreign exchange market, convert
such amount of Available Foreign Currency at its spot rate of exchange
(inclusive of all reasonable related costs of conversion) applicable
to the relevant transaction at or about 10:00 A.M., Dallas, Texas
time, on such date.
"Domestic Subsidiary" means, with respect to any Person, any
Subsidiary of such Person which is incorporated or organized under the
laws of any State of the United States or the District of Columbia.
"Eligible Assignees" means (i) any Lender or any Affiliate or
Subsidiary of a Lender, and (ii) any other commercial bank, financial
institution or "accredited investor" (as defined in Regulation D of
the Securities and Exchange Commission) approved by the Agent and the
Borrower (which approval shall not be unreasonably withheld).
"Eligible Inventory" means, as of any date of determination
and without duplication, the lower of the aggregate book value (based
on a FIFO or a moving average cost valuation, consistently applied) or
fair market value of all raw materials, work in process and finished
goods inventory owned by the Borrower less appropriate reserves
determined in accordance with GAAP but excluding in any event (i)
inventory which is (a) not subject to a perfected, first priority Lien
in favor of the Agent to secure the Borrower's
10
<PAGE> 16
Obligations or (b) subject to any other Lien that is not a Permitted
Lien, (ii) inventory which is not in good condition or fails to meet
standards for sale or use imposed by governmental agencies,
departments or divisions having regulatory authority over such goods,
(iii) inventory which is not useable or saleable at prices
approximating their cost in the ordinary course of the Borrower's
business (including without duplication the amount of any reserves for
obsolescence, unsalability or decline in value), (iv) inventory
located outside of the United States, other than inventory of the
Borrower in an aggregate amount not to exceed $15,000,000 located in
the Genicom International Distribution Center in Colchester, Essex,
England, or at such other locations in U.S. territories and Western
European countries as shall be acceptable to the Agent in its sole
discretion, (v) inventory located at a location leased by the Borrower
(including without limitation the inventory located in Colchester,
Essex, England described in clause (iv) above) with respect to which
the Agent or the Required Lenders shall have requested and the Agent
shall not have received a landlord's waiver satisfactory to the Agent,
(vi) inventory which is leased or on consignment and (vii) inventory
which fails to meet such other specifications and requirements as may
from time to time be established by the Agent in its reasonable
discretion.
"Eligible Receivables" means, as of any date of determination
and without duplication, the aggregate book value of all accounts
receivable, receivables, and obligations for payment created or
arising from the sale of inventory or the rendering of services in the
ordinary course of business (collectively, the "Receivables"), owned
by or owing to the Borrower, net of allowances and reserves for
doubtful or uncollectible accounts and sales adjustments consistent
with the Borrower's internal policies and in any event in accordance
with GAAP, but excluding in any event (i) Receivables which are (a)
not subject to a perfected, first priority Lien in favor of the Agent
to secure the Borrower's Obligations or (b) subject to any other Lien
that is not a Permitted Lien, (ii) Receivables which are more than 90
days from the date of invoice (net of reserves for bad debts in
connection with any such Receivables), (iii) 50% of the book value of
any Receivable not otherwise excluded by clause (ii) above but owing
from an account debtor which is the account debtor on any existing
Receivable then excluded by such clause (ii), unless the exclusion by
such clause (ii) is a result of a legitimate dispute by the account
debtor and the applicable Receivable is no more than 90 days past due,
(iv) Receivables evidenced by notes, chattel paper or other
instruments, unless such notes, chattel paper or instruments (a) have
been delivered to and are in the possession of the Agent or (b) the
aggregate amount of the Receivables evidenced thereby is not greater
than $50,000, (v) Receivables owing by an account debtor which is not
solvent or is subject to any bankruptcy or insolvency proceeding of
any kind, other than any Receivable arising after the commencement of
a bankruptcy or insolvency proceeding against the applicable account
debtor and which either arise from a C.O.D. sale or is secured by a
perfected first priority lien in favor of the Borrower, provided that
the aggregate amount of all such Receivables under this clause (v)
shall not exceed $100,000, (vi) Receivables owing by an account debtor
located outside of the United States (unless payment for the goods
shipped is secured by an irrevocable letter of credit in a form and
from an institution acceptable to the Agent), (vii) Receivables which
are contingent or subject to offset, deduction,
11
<PAGE> 17
counterclaim, dispute or other defense to payment, in each case to the
extent of such offset, deduction, counterclaim, dispute or other
defense, (viii) Receivables for which any direct or indirect
Subsidiary of the Borrower or any Affiliate of the Borrower is the
account debtor, (ix) Receivables representing a sale to the government
of the United States of America or any subdivision thereof unless the
Borrower has complied (to the satisfaction of the Agent), with respect
to the granting of a security interest in such Receivable, with the
Federal Assignment of Claims Act or other similar applicable law and
(x) Receivables which fail to meet such other specifications and
requirements as may from time to time be established by the Agent in
its reasonable discretion.
"Environmental Laws" means any and all lawful and applicable
Federal, state, local and foreign statutes, laws, regulations,
ordinances, rules, judgments, orders, decrees, permits, concessions,
grants, franchises, licenses, agreements or other governmental
restrictions relating to the environment or to emissions, discharges,
releases or threatened releases of pollutants, contaminants,
chemicals, or industrial, toxic or hazardous substances or wastes into
the environment including, without limitation, ambient air, surface
water, ground water, or land, or otherwise relating to the
manufacture, processing, distribution, use, treatment, storage,
disposal, transport, or handling of pollutants, contaminants,
chemicals, or industrial, toxic or hazardous substances or wastes.
"Equity Transaction" means any issuance by the Borrower or any
of its Subsidiaries to any Person of (i) shares of its capital stock
or other equity interests, (ii) any shares of its capital stock or
other equity interests pursuant to the exercise of options or warrants
or (iii) any shares of its capital stock or other equity interests
pursuant to the conversion of any debt securities to equity.
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended, and any successor statute thereto, as interpreted by
the rules and regulations thereunder, all as the same may be in effect
from time to time. References to sections of ERISA shall be construed
also to refer to any successor sections.
"ERISA Affiliate" means an entity, whether or not
incorporated, which is under common control with the Borrower or of
its Subsidiaries within the meaning of Section 4001(a)(14) of ERISA,
or is a member of a group which includes the Borrower or any of its
Subsidiaries and which is treated as a single employer under Sections
414(b), (c), (m), or (o) of the Code.
"Eurodollar Loan" means any Loan bearing interest at a rate
determined by reference to the Eurodollar Rate.
"Eurodollar Rate" means, for the Interest Period for each
Eurodollar Loan comprising part of the same borrowing (including
conversions, extensions and renewals), a per annum interest rate equal
to (i) with respect to any Eurodollar Loan which is not a Foreign
Currency Loan for the Interest Period applicable thereto, the per
annum rate of interest determined by the office of the Agent on the
basis of the offered rates for deposits
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<PAGE> 18
in Dollars (for a period of time corresponding to such Interest Period
and commencing on the first day of such Interest Period) which appear
on Telerate Page 3750 as of 11:00 a.m. (London time) two Business Days
before the first day of such Interest Period (provided that if at
least two such offered rates appear on Telerate Page 3750, the rate in
respect of such Interest Period will be the arithmetic mean of such
offered rates), and (ii) with respect to any Foreign Currency Loan for
the Interest Period applicable thereto, the per annum rate of interest
determined by the office of the Agent on the basis of the offered
rates for deposits in the relevant Available Foreign Currency (for a
period of time corresponding to such Interest Period and commencing on
the first day of such Interest Period) which appear on Telerate Page
3750 as of 11:00 a.m. (London time) two Business Days before the first
day of such Interest Period (provided that if at least two such
offered rates appear on Telerate Page 3750, the rate in respect of
such Interest Period will be the arithmetic mean of such offered
rates). If for any reason the foregoing rates are unavailable from
the Telerate service then a market rate as determined by the Agent.,
"Eurodollar Reserve Percentage" means for any day, that
percentage (expressed as a decimal) which is in effect from time to
time under Regulation D of the Board of Governors of the Federal
Reserve System (or any successor), as such regulation may be amended
from time to time or any successor regulation, as the maximum reserve
requirement (including, without limitation, any basic, supplemental,
emergency, special, or marginal reserves) applicable with respect to
Eurocurrency liabilities as that term is defined in Regulation D (or
against any other category of liabilities that includes deposits by
reference to which the interest rate of Eurodollar Loans is
determined).
"Event of Default" means such term as defined in Section 9.1.
"Excess Cash Flow" means, for any fiscal year period of the
Borrower and its Subsidiaries, Consolidated EBITDA for such fiscal
year, plus the actual negative change (if any) or minus the actual
positive change (if any) in Consolidated Working Capital as of the
last day of such fiscal year since the last day of the preceding
fiscal year, minus Consolidated Interest Expense for such fiscal year,
minus Consolidated Scheduled Funded Indebtedness Payments for such
fiscal year, minus Consolidated Cash Taxes for such fiscal year, minus
Consolidated Capital Expenditures for such fiscal year, minus the
aggregate purchase prices (except to the extent consisting of capital
stock or other securities of the Borrower), together with all related
costs and expenses (excluding intercompany items), paid or incurred by
the Borrower or any of its Subsidiaries for acquisitions of capital
stock or securities or all or any substantial part of the Property of
any Person (other than the Borrower or any of its Subsidiaries) during
the period from the date immediately succeeding the date of the annual
mandatory prepayment pursuant to Section 3.3(b)(iv) for the prior
fiscal year (or, with respect to fiscal year 1997, the Closing Date)
until the date of the annual mandatory prepayment pursuant to Section
3.3(b)(iv) for such fiscal year.
"Existing Credit Agreement" means that certain Credit
Agreement, dated as of January 12, 1996,as amended from time to time
thereafter, by and among the Borrower, the
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<PAGE> 19
guarantors party thereto, the lenders party thereto and NationsBank of
Texas, N.A., as agent for such.
"Fees" means all fees payable pursuant to Section 3.5.
"Federal Funds Rate" means, for any day, the rate of interest
per annum (rounded upwards, if necessary, to the nearest whole
multiple of 1/100 of 1%) equal to the weighted average of the rates on
overnight Federal funds transactions with members of the Federal
Reserve System arranged by Federal funds brokers on such day, as
published by the Federal Reserve Bank of New York on the Business Day
next succeeding such day, provided that (A) if such day is not a
Business Day, the Federal Funds Rate for such day shall be such rate
on such transactions on the next preceding Business Day and (B) if no
such rate is so published on such next succeeding Business Day, the
Federal Funds Rate for such day shall be the average rate quoted to
the Agent on such day on such transactions as determined by the Agent.
"Foreign Currency Commitment" means, with respect to each
Lender, the commitment of such Lender to make Foreign Currency Loans
in an aggregate principal amount at any time outstanding of up to such
Lender's Foreign Currency Commitment Percentage of the Foreign
Currency Committed Amount.
"Foreign Currency Commitment Percentage" means, for any
Lender, the percentage identified as its Foreign Currency Commitment
Percentage on Schedule 2.1(a), as such percentage may be modified in
connection with any assignment made in accordance with the provisions
of Section 11.3.
"Foreign Currency Committed Amount" shall have the meaning
assigned to such term in Section 2.4(a).
"Foreign Currency Equivalent" means, on any date, with respect
to an amount denominated in Dollars, the amount of any applicable
Available Foreign Currency into which the Agent could, in accordance
with its practice from time to time in the interbank foreign exchange
market, convert such amount of Dollars at its spot rate of exchange
(inclusive of all reasonable related costs of conversion) applicable
to the relevant transaction at or about 10:00 A.M., Dallas, Texas
time, on such date.
"Foreign Currency Loans" shall have the meaning assigned to
such term in Section 2.4(a).
"Foreign Currency Note" means a promissory note of the
Borrower in favor of a Lender delivered pursuant to Section 2.4(e) and
evidencing the Foreign Currency Loans of such Lender, as such
promissory note may be amended, modified, restated or replaced from
time to time.
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<PAGE> 20
"Foreign Subsidiary", of any Person, means any Subsidiary of
such Person which is not a Domestic Subsidiary of such Person.
"Funded Indebtedness" means, with respect to any Person,
without duplication, (i) all Indebtedness of such Person for borrowed
money, (ii) all purchase money Indebtedness of such Person, including
without limitation the principal portion of all obligations of such
Person under Capital Leases, (iii) all Guaranty Obligations of such
Person with respect to Funded Indebtedness of another Person, (iv) the
maximum amount of all standby letters of credit issued or bankers'
acceptances facilities created for the account of such Person and,
without duplication, all drafts drawn thereunder (to the extent
unreimbursed) and (v) all Funded Indebtedness of another Person
secured by a Lien on any Property of such Person, whether or not such
Funded Indebtedness has been assumed. The Funded Indebtedness of any
Person (x) shall include the Funded Indebtedness of any partnership or
joint venture in which such Person is a general partner or joint
venturer (except for any such Funded Indebtedness with respect to
which the holder thereof is limited to the assets of such partnership
or joint venture) and (y) shall not include any Intercompany
Indebtedness of such Person.
"GAAP" means generally accepted accounting principles in the
United States applied on a consistent basis and subject to the terms
of Section 1.3 hereof.
"Governmental Authority" means any Federal, state, local or
foreign court or governmental agency, authority, instrumentality or
regulatory body.
"Guarantor" means each of those Persons identified as a
"Guarantor" on the signature pages hereto, and each Additional Credit
Party which may hereafter execute a Joinder Agreement, together with
their permitted successors and assigns.
"Guaranty Obligations" means, with respect to any Person,
without duplication, any obligations of such Person (other than
endorsements in the ordinary course of business of negotiable
instruments for deposit or collection) guaranteeing or intended to
guarantee any Indebtedness of any other Person in any manner, whether
direct or indirect, and including without limitation any obligation,
whether or not contingent, (i) to purchase any such Indebtedness or
any Property constituting security therefor, (ii) to advance or
provide funds or other support for the payment or purchase of any such
Indebtedness or to maintain working capital, solvency or other balance
sheet condition of such other Person (including without limitation
keep well agreements, maintenance agreements, comfort letters or
similar agreements or arrangements) for the benefit of any holder of
Indebtedness of such other Person, (iii) to lease or purchase
Property, securities or services primarily for the purpose of assuring
the holder of such Indebtedness, or (iv) to otherwise assure or hold
harmless the holder of such Indebtedness against loss in respect
thereof. The amount of any Guaranty Obligation hereunder shall
(subject to any limitations set forth therein) be deemed to be an
amount equal to the outstanding principal amount of the Indebtedness
in respect of which such Guaranty Obligation is made.
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<PAGE> 21
"Indebtedness" of any Person means (i) all obligations of such
Person for borrowed money, (ii) all obligations of such Person
evidenced by bonds, debentures, notes or similar instruments, or upon
which interest payments are customarily made, (iii) all obligations of
such Person under conditional sale or other title retention agreements
relating to Property purchased by such Person (other than customary
reservations or retentions of title under agreements with suppliers
entered into in the ordinary course of business), (iv) all obligations
of such Person issued or assumed as the deferred purchase price of
Property or services purchased by such Person (other than trade debt
incurred in the ordinary course of business and due within six months
of the incurrence thereof) which would appear as liabilities on a
balance sheet of such Person, (v) all obligations of such Person under
take-or-pay or similar arrangements or under commodities agreements,
(vi) all Indebtedness of others secured by (or for which the holder of
such Indebtedness has an existing right, contingent or otherwise, to be
secured by) any Lien on, or payable out of the proceeds of production
from, Property owned or acquired by such Person, whether or not the
obligations secured thereby have been assumed, (vii) all Guaranty
Obligations of such Person, (viii) the principal portion of all
obligations of such Person under Capital Leases, (ix) all obligations
of such Person in respect of interest rate protection agreements,
foreign currency exchange agreements, commodity purchase or option
agreements or other interest or exchange rate or commodity price
hedging agreements, (x) the maximum amount of all standby letters of
credit issued or bankers' acceptances facilities created for the
account of such Person and, without duplication, all drafts drawn
thereunder (to the extent unreimbursed) and (xi) all preferred stock
issued by such Person and required by the terms thereof to be redeemed,
or for which mandatory sinking fund payments are due, by a fixed date.
The Indebtedness of any Person shall include (i) the Indebtedness of
any partnership or joint venture in which such Person is a general
partner or joint venturer (except for any such Indebtedness with
respect to which the holder thereof is limited to the assets of such
partnership or joint venture) and (ii) intercompany items.
"Initial Interest Rate Period" means the period commencing as
of the Closing Date and ending October 31, 1997, during which time all
Eurodollar Loans shall have an Interest Period of one (1) month.
"Intercompany Indebtedness" means any Indebtedness which (i)
is owing by a Credit Party to the Borrower or any of its Subsidiaries
and (ii) by its terms is specifically subordinated in right of payment
to the prior payment of the obligations of the Credit Parties under
this Credit Agreement and the other Credit Documents on terms and
conditions reasonably satisfactory to the Agent.
"Interest Payment Date" means (i) as to any Base Rate Loan
other than a Swingline Loan, the last day of each March, June,
September and December and the Maturity Date, (ii) as to any
Eurodollar Loan, the last day of each Interest Period for such Loan
and the Maturity Date, and in addition where the applicable Interest
Period is more than 3 months, then also on the date 3 months from the
beginning of the Interest Period, and each 3 months thereafter, and
(iii) as to any Swingline Loan, the last day of each calendar month
and the Maturity Date. If an Interest Payment Date falls on a date
which
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<PAGE> 22
is not a Business Day, such Interest Payment Date shall be deemed to
be the next succeeding Business Day, except that in the case of
Eurodollar Loans where the next succeeding Business Day falls in the
next succeeding calendar month, then on the next preceding Business
Day.
"Interest Period" means (i) as to any Eurodollar Loan, a
period of one, two, three or six month's duration, as the Borrower may
elect, commencing in each case, on the date of the borrowing
(including conversions, extensions and renewals), and (ii) as to any
Swingline Loan, a period commencing in each case on the date of the
borrowing and ending on the date agreed to by the Borrower and the
Swingline Lender in accordance with the provisions of Section
2.3(b)(i) (such ending date in any event to be not more than seven (7)
Business Days from the date of borrowing); provided, however, (A) if
any Interest Period would end on a day which is not a Business Day,
such Interest Period shall be extended to the next succeeding Business
Day (except that in the case of Eurodollar Loans where the next
succeeding Business Day falls in the next succeeding calendar month,
then on the next preceding Business Day), (B) no Interest Period shall
extend beyond the Maturity Date, (C) with regard to the Tranche A Term
Loan, no Interest Period shall extend beyond any principal
amortization payment date unless the portion of the Tranche A Term
Loan comprised of Base Rate Loans together with the portion of the
Tranche A Term Loan comprised of Eurodollar Loans with Interest
Periods expiring prior to the date such principal amortization payment
is due, is at least equal to the amount of such principal amortization
payment due on such date, (D) with regard to the Tranche B Term Loan,
no Interest Period shall extend beyond any principal amortization
payment date unless the portion of the Tranche B Term Loan comprised
of Base Rate Loans together with the portion of the Tranche B Term
Loan comprised of Eurodollar Loans with Interest Periods expiring
prior to the date such principal amortization payment is due, is at
least equal to the amount of such principal amortization payment due
on such date, and (E) in the case of Eurodollar Loans, where an
Interest Period begins on a day for which there is no numerically
corresponding day in the calendar month in which the Interest Period
is to end, such Interest Period shall end on the last day of such
calendar month.
"Investment", in any Person, means any loan or advance to such
Person, any purchase or other acquisition of any capital stock,
warrants, rights, options, obligations or other securities of such
Person, any capital contribution to such Person or any other
investment in such Person, including, without limitation, any Guaranty
Obligation incurred for the benefit of such Person.
"Issuing Lender" means NationsBank.
"Issuing Lender Fees" shall have the meaning assigned to such
term in Section 3.5(b)(iii).
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"Joinder Agreement" means a Joinder Agreement substantially in
the form of Schedule 7.12 hereto, executed and delivered by an
Additional Credit Party in accordance with the provisions of Section
7.12.
"Lenders" means each of the Persons identified as a "Lender"
on the signature pages hereto, and each Person which may become a
Lender by way of assignment in accordance with the terms hereof,
together with their successors and permitted assigns.
"Letter of Credit" means any letter of credit issued by the
Issuing Lender in accordance with the terms of Section 2.2.
"Lien" means any mortgage, pledge, hypothecation, assignment,
deposit arrangement, security interest, encumbrance, lien (statutory
or otherwise), preference, priority or charge of any kind (including
any agreement to give any of the foregoing, any conditional sale or
other title retention agreement and any lease in the nature thereof).
"Loan" or "Loans" means the Revolving Loans, the Tranche A
Term Loan, the Tranche B Term Loan (or any Revolving Loan, any portion
of the Tranche A Term Loan or any portion of the Tranche B Term Loan
bearing interest at the Base Rate or the Eurodollar Rate and referred
to as a Base Rate Loan or a Eurodollar Loan), the Swingline Loans
and/or any Foreign Currency Loan (or any Foreign Currency Loan
referred to as a Eurodollar Loan), individually or collectively, as
appropriate.
"LOC Commitment" means the commitment of the Issuing Lender to
issue Letters of Credit in an aggregate face amount at any time
outstanding (together with the amounts of any unreimbursed drawings
thereon) of up to the LOC Committed Amount in accordance with the
provisions of Section 2.2(a).
"LOC Committed Amount" shall have the meaning assigned to such
term in Section 2.2.
"LOC Documents" means, with respect to any Letter of Credit,
such Letter of Credit, any amendments thereto, any documents delivered
in connection therewith, any application therefor, and any agreements,
instruments, guarantees or other documents (whether general in
application or applicable only to such Letter of Credit) governing or
providing for (i) the rights and obligations of the parties concerned
or at risk or (ii) any collateral security for such obligations.
"LOC Obligations" means, at any time, the sum of (i) the
maximum amount which is, or at any time thereafter may become,
available to be drawn under Letters of Credit then outstanding,
assuming compliance with all requirements for drawings referred to in
such Letters of Credit plus (ii) the aggregate amount of all drawings
under Letters of Credit honored by the Issuing Lender but not
theretofore reimbursed.
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"Material Adverse Effect" means a material adverse effect on
(i) the condition (financial or otherwise), operations, business,
assets or liabilities of the Borrower or of the Borrower and its
Subsidiaries taken as a whole, (ii) the ability of any Credit Party to
perform any material obligation under the Credit Documents or (iii)
the material rights and remedies of the Lenders under the Credit
Documents.
"Materials of Environmental Concern" means any gasoline or
petroleum (including crude oil or any fraction thereof) or petroleum
products or any hazardous or toxic substances, materials or wastes,
defined or regulated as such in or under any Environmental Laws,
including, without limitation, asbestos, polychlorinated biphenyls and
urea-formaldehyde insulation.
"Maturity Date" means (i) as to Revolving Loans, Letters of
Credit (and the related LOC Obligations), Foreign Currency Loans and
the Tranche A Term Loan, September 5, 2002, and (ii) as to the Tranche
B Term Loan, September 5, 2004.
"Moody's" means Moody's Investors Service, Inc., or any
successor or assignee of the business of such company in the business
of rating securities.
"Mortgage Instrument" means any mortgage, deed of trust or
deed to secure debt delivered to the Agent by the Borrower or any of
its Subsidiaries pursuant to Section 7.12 or 7.13.
"Multiemployer Plan" means a Plan which is a multiemployer
plan as defined in Sections 3(37) or 4001(a)(3) of ERISA.
"Multiple Employer Plan" means a Plan which the Borrower, any
Subsidiary of the Borrower or any ERISA Affiliate and at least one
employer other than the Borrower, any Subsidiary of the Borrower or
any ERISA Affiliate are contributing sponsors.
"NationsBank" means NationsBank of Texas, N.A. and its
successors.
"Net Proceeds" means cash proceeds received by the Borrower or
any of its Subsidiaries from time to time in connection with any Asset
Disposition or Equity Transaction, net of the actual costs (excluding
intercompany items) and taxes incurred by such Person in connection
with and attributable to such Asset Disposition or Equity Transaction,
as applicable.
"New Commitment Agreement" means such term as is defined in
Section 3.4.
"Non-Excluded Taxes" means such term as is defined in Section
3.11.
"Note" or "Notes" means any Revolving Note, the Swingline
Note, any Foreign Currency Note, the Tranche A Term Note or the
Tranche B Term Note, as the context may require.
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<PAGE> 25
"Notice of Borrowing" means a written notice of borrowing in
substantially the form of Schedule 2.1(b)(i), as required by Section
2.1(b)(i), Section 2.4(b)(i), Section 2.5(b)(i) or Section 2.6(b).
"Notice of Extension/Conversion" means the written notice of
extension or conversion in substantially the form of Schedule 3.2 as
required by Section 3.2.
"Operating Lease" means, as applied to any Person, any lease
(including, without limitation, leases which may be terminated by the
lessee at any time) of any Property (whether real, personal or mixed)
which is not a Capital Lease other than any such lease in which that
Person is the lessor.
"Participation Interest" means, the extension of credit by a
Lender by way of a purchase of a participation in any Letters of
Credit or LOC Obligations as provided in Section 2.2(c), in Swingline
Loans as provided in Section 2.3(b)(iii) or in any Loans as provided
in Section 3.14.
"PBGC" means the Pension Benefit Guaranty Corporation
established pursuant to Subtitle A of Title IV of ERISA and any
successor thereof.
"Permitted Investments" means Investments which are either (i)
cash and Cash Equivalents; (ii) accounts receivable created, acquired
or made by the Borrower or any of its Subsidiaries in the ordinary
course of business and payable or dischargeable in accordance with
customary trade terms; (iii) Investments consisting of stock,
obligations, securities or other property received by the Borrower or
any of its Subsidiaries in settlement of accounts receivable (created
in the ordinary course of business) from bankrupt obligors; (iv)
Investments existing as of the Closing Date and set forth in Schedule
1.1A, (v) additional Investments in any Subsidiary of the Borrower
which is a Guarantor; (vi) subject to the terms of Section 7.15(b),
additional Investments in Subsidiaries of the Borrower which are not
Guarantors not to exceed $10,000,000 at any one time outstanding;
(vii) Guaranty Obligations permitted by Section 8.1; (viii)
acquisitions permitted by Section 8.4(c); (ix) transactions permitted
by Section 8.8; and (x) loans to directors, officers, employees,
agents, customers or suppliers that do not exceed an aggregate
principal amount of $1,000,000 at any one time outstanding.
"Permitted Liens" means:
(i) Liens in favor of the Agent on behalf of the
Lenders;
(ii) Liens (other than Liens created or imposed
under ERISA) for taxes, assessments or governmental charges or
levies not yet due or Liens for taxes being contested in good
faith by appropriate proceedings for which adequate reserves
determined in accordance with GAAP have been established (and
as to
20
<PAGE> 26
which the Property subject to any such Lien is not yet subject
to foreclosure, sale or loss on account thereof);
(iii) statutory Liens of landlords and Liens of
carriers, warehousemen, mechanics, materialmen and suppliers
and other liens imposed by law or pursuant to customary
reservations or retentions of title arising in the ordinary
course of business, provided that such Liens secure only
amounts not yet due and payable or, if due and payable, are
unfiled and no other action has been taken to enforce the same
or are being contested in good faith by appropriate
proceedings for which adequate reserves determined in
accordance with GAAP have been established (and as to which
the Property subject to any such Lien is not yet subject to
foreclosure, sale or loss on account thereof);
(iv) Liens (other than Liens created or imposed
under ERISA) incurred or deposits made by the Borrower or any
of its Subsidiaries in the ordinary course of business in
connection with workers' compensation, unemployment insurance
and other types of social security, or to secure the
performance of tenders, statutory obligations, bids, leases,
government contracts, performance and return-of-money bonds
and other similar obligations (exclusive of obligations for
the payment of borrowed money);
(v) Liens in connection with attachments or
judgments (including judgment or appeal bonds) provided that
the judgments secured shall, within 60 days after the entry
thereof, have been discharged or execution thereof stayed
pending appeal, or shall have been discharged within 30 days
after the expiration of any such stay;
(vi) easements, rights-of-way, restrictions
(including zoning restrictions), minor defects or
irregularities in title and other similar charges or
encumbrances not, in any material respect, impairing the use
of the encumbered Property for its intended purposes;
(vii) Liens on Property of the Borrower or any of
its Subsidiaries securing purchase money Indebtedness
(including Capital Leases) of such Person to the extent
permitted under Section 8.1(b) or (c), provided that any such
Lien attaches to such Property concurrently with or within 90
days after the acquisition thereof;
(viii) leases or subleases granted to others not
interfering in any material respect with the business of the
Borrower or any of its Subsidiaries;
(ix) any interest of title of a lessor under, and
Liens arising from UCC financing statements (or equivalent
filings, registrations or agreements in foreign jurisdictions)
relating to, leases permitted by this Credit Agreement;
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<PAGE> 27
(x) normal and customary rights of setoff upon
deposits of cash in favor of banks or other depository
institutions;
(xi) Liens on Property of any Foreign Subsidiary
of the Borrower securing Indebtedness permitted under Section
8.1(h); and
(xii) Liens existing as of the Closing Date and set
forth on Schedule 1.1B; provided that no such Lien shall at
any time be extended to or cover any Property other than the
Property subject thereto on the Closing Date.
"Person" means any individual, partnership, joint venture,
firm, corporation, limited liability company, association, trust or
other enterprise (whether or not incorporated) or any Governmental
Authority.
"Plan" means any employee benefit plan (as defined in Section
3(3) of ERISA) which is covered by ERISA and with respect to which the
Borrower, any Subsidiary of the Borrower or any ERISA Affiliate is
(or, if such plan were terminated at such time, would under Section
4069 of ERISA be deemed to be) an "employer" within the meaning of
Section 3(5) of ERISA.
"Pledge Agreement" means the amended and restated pledge
agreement dated as of the Closing Date in the form of Schedule 1.1C to
be executed in favor of the Agent by the Borrower and each of the
Guarantors.
"Prime Rate" means the rate of interest per annum publicly
announced from time to time by NationsBank as its prime rate in effect
at its principal office in Dallas, Texas, with each change in the
Prime Rate being effective on the date such change is publicly
announced as effective (it being understood and agreed that the Prime
Rate is a reference rate used by NationsBank in determining interest
rates on certain loans and is not intended to be the lowest rate of
interest charged on any extension of credit by NationsBank to any
debtor).
"Pro Forma Basis" means, with respect to any transaction, that
such transaction shall be deemed to have occurred as of the first day
of the four fiscal-quarter period ending as of the most recent
Calculation Date preceding the date of such transaction with respect
to which the Agent has received the Required Financial Information.
As used herein, "transaction" means (i) any corporate merger or
consolidation as referred to in Section 8.4(a), (ii) any sale or other
disposition of assets as referred to in Section 8.4(b) or (iii) any
acquisition of capital stock or securities or any purchase, lease or
other acquisition of Property as referred to in Section 8.4(c).
"Property" means any interest in any kind of property or
asset, whether real, personal or mixed, or tangible or intangible.
"Register" shall have the meaning given such term in Section
11.3(c).
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"Regulation D, G, U, or X" means Regulation D, G, U or X,
respectively, of the Board of Governors of the Federal Reserve System
as from time to time in effect and any successor to all or a portion
thereof.
"Reportable Event" means any of the events set forth in
Section 4043(c) of ERISA, other than those events as to which the
notice requirement has been waived by regulation.
"Required Financial Information" means, with respect to the
applicable Calculation Date, (i) the financial statements of the
Borrower required to be delivered pursuant to Section 7.1(a) or (b)(i)
for the fiscal period or quarter ending as of such Calculation Date,
and (ii) the certificate of the chief financial officer or treasurer,
of the Borrower required by Section 7.1(c) to be delivered with the
financial statements described in clause (i) above.
"Required Lenders" means, at any time, Lenders which are then
in compliance with their obligations hereunder (as determined by the
Agent) and holding in the aggregate at least 51% of (i) the Revolving
Commitments, the outstanding Tranche A Term Loans (and Participation
Interests therein) and the outstanding Tranche B Term Loans (and
Participation Interests therein) or (ii) if the Commitments have been
terminated, the outstanding Loans and Participation Interests.
"Requirement of Law" means, as to any Person, the certificate
of incorporation and by-laws or other organizational or governing
documents of such Person, and any law, treaty, rule or regulation or
determination of an arbitrator or a court or other Governmental
Authority, in each case applicable to or binding upon such Person or
any of its material property is subject.
"Restricted Payment" means (i) any dividend or other
distribution, direct or indirect, on account of any shares of any
class of stock of the Borrower or any of its Subsidiaries, now or
hereafter outstanding, (ii) any redemption, retirement, sinking fund
or similar payment, purchase or other acquisition for value, direct or
indirect, of any shares of any class of stock of the Borrower or any
of its Subsidiaries, now or hereafter outstanding, (iii) any payment
made to retire, or to obtain the surrender of, any outstanding
warrants, options or other rights to acquire shares of any class of
stock of the Borrower or any of its Subsidiaries, now or hereafter
outstanding, and (iv) any payment or prepayment of principal of, or
interest on, Intercompany Indebtedness.
"Revolving Commitment" means, with respect to each Lender, the
commitment of such Lender, in an aggregate principal amount at any
time outstanding of up to the Dollar Amount of such Lender's Revolving
Commitment Percentage of the Revolving Committed Amount, (i) to make
Revolving Loans in accordance with the provisions of Section 2.1(a),
(ii) to purchase participation interests in Letters of Credit in
accordance with the provisions of Section 2.2(c), (iii) to purchase
participation interests in the Swingline Loans
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in accordance with the provisions of Section 2.3(b)(iii) and (iv) to
make Foreign Currency Loans in accordance with the provisions of
Section 2.4(a).
"Revolving Commitment Percentage" means, for any Lender, the
percentage identified as its Revolving Commitment Percentage on
Schedule 2.1(a), as such percentage may be modified in connection with
any assignment made in accordance with the provisions of Section 11.3.
"Revolving Committed Amount" shall have the meaning assigned
to such term in Section 2.1(a).
"Revolving Loans" shall have the meaning assigned to such term
in Section 2.1(a).
"Revolving Note" means a promissory note of the Borrower in
favor of a Lender delivered pursuant to Section 2.1(e) and evidencing
the Revolving Loans of such Lender, as such promissory note may be
amended, modified, restated or replaced from time to time.
"S&P" means Standard & Poor's Ratings Group, a division of
McGraw Hill, Inc., or any successor or assignee of the business of
such division in the business of rating securities.
"Security Agreement" means the amended and restated security
agreement dated as of the Closing Date in the form of Schedule 1.1D to
be executed in favor of the Agent by the Borrower and each of the
Guarantors.
"Single Employer Plan" means any Plan which is covered by
Title IV of ERISA, but which is not a Multiemployer Plan.
"Solvent" or "Solvency" means, with respect to any Person as
of a particular date, that on such date (i) such Person is able to
realize upon its assets and pay its debts and other liabilities,
contingent obligations and other commitments as they mature in the
normal course of business, (ii) such Person does not intend to, and
does not believe that it will, incur debts or liabilities beyond such
Person's ability to pay as such debts and liabilities mature in their
ordinary course, (iii) such Person is not engaged in a business or a
transaction, and is not about to engage in a business or a
transaction, for which such Person's Property would constitute
unreasonably small capital after giving due consideration to the
prevailing practice in the industry in which such Person is engaged or
is to engage, (iv) the fair value of the Property of such Person is
greater than the total amount of liabilities, including, without
limitation, contingent liabilities, of such Person and (v) the present
fair saleable 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. In computing
the amount of contingent liabilities at any time, it is intended that
such liabilities will be computed at the amount which, in light
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of all the facts and circumstances existing at such time, represents
the amount that can reasonably be expected to become an actual or
matured liability.
"Standby Letter of Credit Fee" shall have the meaning assigned
to such term in Section 3.5(b)(i).
"Subsidiary" means, as to any Person, (a) any corporation more
than 50% of whose stock of any class or classes having by the terms
thereof ordinary voting power to elect a majority of the directors of
such corporation (irrespective of whether or not at the time, any
class or classes of such corporation shall have or might have voting
power by reason of the happening of any contingency) is at the time
owned by such Person directly or indirectly through Subsidiaries, and
(b) any partnership, association, joint venture or other entity in
which such Person directly or indirectly through Subsidiaries has more
than 50% equity interest at any time.
"Swingline Commitment" means the commitment of the Swingline
Lender to make Swingline Loans in an aggregate principal amount at any
time outstanding of up to the Swingline Committed Amount in accordance
with the provisions of Section 2.3(a).
"Swingline Committed Amount" shall have the meaning assigned
to such term in Section 2.3(a).
"Swingline Lender" means NationsBank.
"Swingline Loan" shall have the meaning assigned to such term
in Section 2.3(a).
"Swingline Note" means the promissory note of the Borrower in
favor of the Swingline Lender delivered pursuant to Section 2.3(d) and
evidencing the Swingline Loans, as such promissory note may be
amended, modified, restated or replaced from time to time.
"Termination Event" means (i) with respect to any Plan, the
occurrence of a Reportable Event or the substantial cessation of
operations (within the meaning of Section 4062(e) of ERISA); (ii) the
withdrawal by the Borrower, any Subsidiary of the Borrower or any
ERISA Affiliate from a Multiple Employer Plan during a plan year in
which it was a substantial employer (as such term is defined in
Section 4001(a)(2) of ERISA), or the termination of a Multiple
Employer Plan; (iii) the distribution of a notice of intent to
terminate or the actual termination of a Plan pursuant to Section
4041(a)(2) or 4041A of ERISA; (iv) the institution of proceedings to
terminate or the actual termination of a Plan by the PBGC under
Section 4042 of ERISA; (v) any event or condition which might
constitute grounds under Section 4042 of ERISA for the termination of,
or the appointment of a trustee to administer, any Plan; or (vi) the
complete or partial withdrawal by the Borrower, any Subsidiary of the
Borrower or any ERISA Affiliate from a Multiemployer Plan.
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"Texas Instruments" means Texas Instruments Incorporated, a
Delaware corporation.
"TI Deferred Financing Note" means that certain subordinated
promissory note dated September 30, 1996 executed by the Borrower in
favor of Texas Instruments Incorporated, a Delaware corporation, in
the original principal amount of $9,000,000.
"TIWP Assets" means the raw materials and work in process, and
the equipment, tools and fixtures used in the manufacturing process of
that certain business (printer business components) formerly within
the Personal Productivity Products Division of Texas Instruments
Incorporated and purchased by the Borrower from Texas Instruments
Incorporated pursuant to that certain Asset Purchase Agreement dated
as of July 23, 1996, as amended as of September 30, 1996.
"Trade Letter of Credit Fee" shall have the meaning assigned
to such term in Section 3.5(b)(ii).
"Tranche A Term Loan" shall have the meaning assigned to such
term in Section 2.5(a).
"Tranche A Term Loan Commitment" means, with respect to each
Lender, the commitment of such Lender to make its portion of the
Tranche A Term Loan in a principal amount equal to such Lender's
Tranche A Term Loan Commitment Percentage of the Tranche A Term Loan
Committed Amount.
"Tranche A Term Loan Commitment Percentage" means, for any
Lender, the percentage identified as its Tranche A Term Loan
Commitment Percentage on Schedule 2.1(a), as such percentage may be
modified in connection with any assignment made in accordance with the
provisions of Section 11.3.
"Tranche A Term Loan Committed Amount" shall have the meaning
assigned to such term in Section 2.5(a).
"Tranche A Term Note" means a promissory note of the Borrower
in favor of a Lender delivered pursuant to Section 2.5(e) and
evidencing such Lender's portion of the Tranche A Term Loan, as such
promissory note may be amended, modified, restated or replaced from
time to time.
"Tranche B Term Loan" shall have the meaning assigned to such
term in Section 2.6(a).
"Tranche B Term Loan Commitment" means, with respect to each
Lender, the commitment of such Lender to make its portion of the
Tranche B Term Loan in a principal amount equal to such Lender's
Tranche B Term Loan Commitment Percentage of the Tranche B Term Loan
Committed Amount.
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"Tranche B Term Loan Commitment Percentage" means, for any
Lender, the percentage identified as its Tranche B Term Loan
Commitment Percentage on Schedule 2.1(a), as such percentage may be
modified in connection with any assignment made in accordance with the
provisions of Section 11.3.
"Tranche B Term Loan Committed Amount" shall have the meaning
assigned to such term in Section 2.6(a).
"Tranche B Term Note" means a promissory note of the Borrower
in favor of a Lender delivered pursuant to Section 2.6(f) and
evidencing such Lender's portion of the Tranche B Term Loan, as such
promissory note may be amended, modified, restated or replaced from
time to time.
"U.K. Security Agreements" means a collective reference to (i)
the amended and restated debenture dated as of the Closing Date in the
form of Schedule 1.1E-1 to be executed in favor of the Agent by the
Borrower and (ii) the amended and restated debenture dated as of the
Closing Date in the form of Schedule 1.1E-2 to be executed in favor of
the Agent by Genicom Ltd.
"Unused Fee" shall have the meaning assigned to such term in
Section 3.5(a).
"Unused Fee Calculation Period" shall have the meaning
assigned to such term in Section 3.5(a).
"Unused Revolving Committed Amount" means, for any period, the
amount by which (a) the then applicable Revolving Committed Amount
exceeds (b) the daily average sum for such period of (i) the
outstanding aggregate principal amount of all Revolving Loans and all
Foreign Currency Loans (but not Swingline Loans) plus (ii) the
outstanding aggregate principal amount of all LOC Obligations.
"Voting Stock" means, with respect to any Person, capital
stock issued by such Person the holders of which are ordinarily, in
the absence of contingencies, entitled to vote for the election of
directors (or persons performing similar functions) of such Person,
even though the right so to vote has been suspended by the happening
of such a contingency.
"Wholly Owned Subsidiary" of any Person means any Subsidiary
100% of whose Voting Stock or other equity interests is at the time
owned by such Person directly or indirectly through other Wholly Owned
Subsidiaries.
1.2 COMPUTATION OF TIME PERIODS.
For purposes of computation of periods of time hereunder, the word
"from" means "from and including" and the words "to" and "until" each mean "to
but excluding."
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1.3 ACCOUNTING TERMS.
Except as otherwise expressly provided herein, all accounting terms
used herein shall be interpreted, and all financial statements and certificates
and reports as to financial matters required to be delivered to the Lenders
hereunder shall be prepared, in accordance with GAAP applied on a consistent
basis. All calculations made for the purposes of determining compliance with
this Credit Agreement shall (except as otherwise expressly provided herein) be
made by application of GAAP applied on a basis consistent with the most recent
annual or quarterly financial statements delivered pursuant to Section 7.1
hereof (or, prior to the delivery of the first financial statements pursuant to
Section 7.1 hereof, consistent with the financial statements as at December 29,
1996); provided, however, if (a) the Borrower shall object to determining such
compliance on such basis at the time of delivery of such financial statements
due to any change in GAAP or the rules promulgated with respect thereto or (b)
the Agent or the Required Lenders shall so object in writing within 30 days
after delivery of such financial statements, then such calculations shall be
made on a basis consistent with the most recent financial statements delivered
by the Borrower to the Lenders as to which no such objection shall have been
made.
SECTION 2
CREDIT FACILITIES
2.1 REVOLVING LOANS.
(a) Revolving Commitment. Subject to the terms and
conditions hereof and in reliance upon the representations and warranties set
forth herein, each Lender severally agrees to make available to the Borrower
such Lender's Revolving Commitment Percentage of revolving credit loans in
Dollars ("Revolving Loans") from time to time from the Closing Date until the
Maturity Date, or such earlier date as the Revolving Commitments shall have
been terminated as provided herein for the purposes hereinafter set forth;
provided, however, that the sum of the aggregate principal amount of
outstanding Revolving Loans shall not exceed the lesser of (a) FIFTY-FIVE
MILLION DOLLARS ($55,000,000.00) (as such aggregate maximum amount may be
increased or reduced from time to time as provided in Section 3.4, the
"Revolving Committed Amount") and (b) the Borrowing Base; provided, further,
(i) with regard to each Lender individually, such Lender's outstanding
Revolving Loans shall not exceed such Lender's Revolving Commitment Percentage
of the Revolving Committed Amount, and (ii) with regard to the Lenders
collectively, the aggregate principal amount of outstanding Revolving Loans
plus the Dollar Amount (as determined as of the most recent Determination Date)
of the aggregate principal amount of outstanding Foreign Currency Loans plus
the aggregate principal amount of outstanding Swingline Loans plus LOC
Obligations outstanding shall not exceed the lesser of (A) the Revolving
Committed Amount and (B) the Borrowing Base. Revolving Loans may consist of
Base Rate Loans or Eurodollar Loans, or a combination thereof, as the Borrower
may request, and may be repaid and reborrowed in accordance with the provisions
hereof; provided, however, that (x) during the Initial Interest Rate Period,
all Eurodollar Loans shall have an Interest Period of one (1) month and (y) no
more than 10 Eurodollar Loans shall be outstanding hereunder at any time. For
purposes hereof, Eurodollar Loans with different Interest Periods and/or in
different
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currencies shall be considered as separate Eurodollar Loans, even if they begin
on the same date, although borrowings, extensions and conversions may, in
accordance with the provisions hereof, be combined at the end of existing
Interest Periods to constitute a new Eurodollar Loan with a single Interest
Period and in the same currency. Revolving Loans hereunder may be repaid and
reborrowed in accordance with the provisions hereof.
(b) Revolving Loan Borrowings.
(i) Notice of Borrowing. The Borrower
shall request a Revolving Loan borrowing by written notice (or
telephone notice promptly confirmed in writing) to the Agent
not later than 11:00 A.M. (Dallas, Texas time) on the Business
Day prior to the date of the requested borrowing in the case
of Base Rate Loans, and on the third Business Day prior to the
date of the requested borrowing in the case of Eurodollar
Loans. Each such request for borrowing shall be irrevocable
and shall specify (A) that a Revolving Loan is requested, (B)
the date of the requested borrowing (which shall be a Business
Day), (C) the aggregate principal amount to be borrowed and
(D) whether the borrowing shall be comprised of Base Rate
Loans, Eurodollar Loans or a combination thereof, and (after
the Initial Interest Rate Period) if Eurodollar Loans are
requested, the Interest Period(s) therefor. If the Borrower
shall fail to specify in any such Notice of Borrowing (I) an
applicable Interest Period in the case of a Eurodollar Loan,
then such notice shall be deemed to be a request for an
Interest Period of one month or (II) the type of Revolving
Loan requested, then such notice shall be deemed to be a
request for a Base Rate Loan hereunder. The Agent shall give
notice to each affected Lender promptly upon receipt of each
Notice of Borrowing pursuant to this Section 2.1(b)(i), the
contents thereof and each such Lender's share of any borrowing
to be made pursuant thereto.
(ii) Minimum Amounts. Each Eurodollar
Loan or Base Rate Loan that is a Revolving Loan shall be in a
minimum aggregate principal amount of $2,000,000 and integral
multiples of $100,000 in excess thereof (or the remaining
amount of the Revolving Committed Amount, if less).
(iii) Advances. Each Lender will make its
Revolving Commitment Percentage of each Revolving Loan
borrowing available to the Agent for the account of the
Borrower as specified in Section 3.15(b), or in such other
manner as the Agent may specify in writing, by 1:00 P.M.
(Dallas, Texas time) on the date specified in the applicable
Notice of Borrowing in Dollars and in funds immediately
available to the Agent. Such borrowing will then be made
available to the Borrower by the Agent by crediting the
account of the Borrower on the books of such office with the
aggregate of the amounts made available to the Agent by the
Lenders and in like funds as received by the Agent.
(c) Repayment. The principal amount of all Revolving
Loans shall be due and payable in full on the Maturity Date.
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(d) Interest. Subject to the provisions of Section 3.1,
Revolving Loans shall bear interest at a per annum rate equal to:
(i) Base Rate Loans. During such
periods as Revolving Loans shall be comprised of Base Rate
Loans, the Base Rate plus the Applicable Percentage;
(ii) Eurodollar Loans. During such
periods as Revolving Loans shall be comprised of Eurodollar
Loans, the Eurodollar Rate plus the Applicable Percentage.
Interest on Revolving Loans shall be payable in arrears on each
applicable Interest Payment Date (or at such other times as may be
specified herein).
(e) Revolving Notes. The Revolving Loans made by each
Lender shall be evidenced by a duly executed promissory note of the
Borrower to each Lender in substantially the form of Schedule 2.1(e).
2.2 LETTER OF CREDIT SUBFACILITY.
(a) Issuance. Subject to the terms and conditions hereof
and of the LOC Documents, if any, and any other terms and conditions
which the Issuing Lender may reasonably require, the Lenders (based on
their respective Revolving Commitment Percentages) will participate in
the issuance by the Issuing Lender from time to time of such Letters
of Credit from the Closing Date until the Maturity Date as the
Borrower may request, in a form acceptable to the Issuing Lender;
provided, however, that (i) the LOC Obligations outstanding shall not
at any time exceed TEN MILLION DOLLARS ($10,000,000.00) (the "LOC
Committed Amount") and (ii) the sum of the aggregate principal amount
of outstanding Revolving Loans plus the Dollar Amount (as determined
as of the most recent Determination Date) of the aggregate principal
amount of outstanding Foreign Currency Loans plus the aggregate
principal amount of outstanding Swingline Loans plus LOC Obligations
outstanding shall not at any time exceed the lesser of (a) the
Revolving Committed Amount and (b) the Borrowing Base. No Letter of
Credit shall (x) have an original expiry date more than one year from
the date of issuance or (y) as originally issued or as extended, have
an expiry date extending beyond the Maturity Date. Each Letter of
Credit shall comply with the related LOC Documents and shall be issued
in Dollars. The issuance and expiry date of each Letter of Credit
shall be a Business Day.
(b) Notice and Reports. The request for the issuance of
a Letter of Credit shall be submitted by the Borrower to the Issuing
Lender at least three (3) Business Days prior to the requested date of
issuance. The Issuing Lender will, at least quarterly and more
frequently upon request, disseminate to each of the Lenders a detailed
report specifying the Letters of Credit which are then issued and
outstanding and any activity with respect
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thereto which may have occurred since the date of the prior report,
and including therein, among other things, the account party, the
beneficiary, the face amount, expiry date as well as any payment or
expirations which may have occurred.
(c) Participation. Each Lender, upon issuance of a
Letter of Credit, shall be deemed to have purchased without recourse a
risk participation from the Issuing Lender in such Letter of Credit
and the obligations arising thereunder, in each case in an amount
equal to its pro rata share of the obligations under such Letter of
Credit (based on the respective Revolving Commitment Percentages of
the Lenders) and shall absolutely, unconditionally and irrevocably
assume, as primary obligor and not as surety, and be obligated to pay
to the Issuing Lender therefor and discharge when due, its pro rata
share of the obligations arising under such Letter of Credit. Without
limiting the scope and nature of each Lender's participation in any
Letter of Credit, to the extent that the Issuing Lender has not been
reimbursed as required hereunder or under any such Letter of Credit,
each such Lender shall pay to the Issuing Lender its pro rata share of
such unreimbursed drawing in same day funds on the day of notification
by the Issuing Lender of an unreimbursed drawing pursuant to the
provisions of subsection (d) hereof. The obligation of each Lender to
so reimburse the Issuing Lender shall be absolute and unconditional
and shall not be affected by the occurrence of a Default, an Event of
Default or any other occurrence or event. Any such reimbursement
shall not relieve or otherwise impair the obligation of the Borrower
to reimburse the Issuing Lender under any Letter of Credit, together
with interest as hereinafter provided.
(d) Reimbursement. In the event of any drawing under any
Letter of Credit, the Issuing Lender will promptly notify the
Borrower. Unless the Borrower shall immediately notify the Issuing
Lender that the Borrower intends to otherwise reimburse the Issuing
Lender for such drawing, the Borrower shall be deemed to have
requested that the Lenders make a Revolving Loan in the amount of the
drawing as provided in subsection (e) hereof on the related Letter of
Credit, the proceeds of which will be used to satisfy the related
reimbursement obligations. The Borrower promises to reimburse the
Issuing Lender on the day of drawing under any Letter of Credit
(either with the proceeds of a Revolving Loan obtained hereunder or
otherwise) in same day funds. If the Borrower shall fail to reimburse
the Issuing Lender as provided hereinabove, the unreimbursed amount of
such drawing shall bear interest at a per annum rate equal to the Base
Rate plus the sum of (i) the Applicable Percentage for Base Rate Loans
which are Revolving Loans and (ii) two percent (2%). The Borrower's
reimbursement obligations hereunder shall be absolute and
unconditional under all circumstances irrespective of any rights of
setoff, counterclaim or defense to payment which the applicable
account party or the Borrower may claim or have against the Issuing
Lender, the Agent, the Lenders, the beneficiary of the Letter of
Credit drawn upon or any other Person, including without limitation
any defense based on any failure of the applicable account party, the
Borrower, or any other Credit Party to receive consideration or the
legality, validity, regularity or unenforceability of the Letter of
Credit; provided, however that the foregoing shall not constitute a
waiver of any claim that the applicable account party may have against
the Issuing Lender in connection with a Letter of Credit under
applicable law, including without limitation a
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claim for wrongful payment. The Issuing Lender will promptly notify
the other Lenders of the amount of any unreimbursed drawing and each
Lender shall promptly pay to the Agent for the account of the Issuing
Lender in Dollars and in immediately available funds, an amount equal
to such Lender's Revolving Commitment Percentage of such unreimbursed
drawing. Such payment shall be made on the day such notice is
received by such Lender from the Issuing Lender if such notice is
received at or before 2:00 P.M. (Dallas, Texas time) otherwise such
payment shall be made at or before 12:00 Noon (Dallas, Texas time) on
the Business Day next succeeding the day such notice is received. If
such Lender does not pay such amount to the Issuing Lender in full
upon such request, such Lender shall, on demand, pay to the Agent for
the account of the Issuing Lender interest on the unpaid amount during
the period from the date of such drawing until such Lender pays such
amount to the Issuing Lender in full at a rate per annum equal to, if
paid within two (2) Business Days of the date that such Lender is
required to make payments of such amount pursuant to the preceding
sentence, the Federal Funds Rate and thereafter at a rate equal to the
Base Rate. Each Lender's obligation to make such payment to the
Issuing Lender, and the right of the Issuing Lender to receive the
same, shall be absolute and unconditional, shall not be affected by
any circumstance whatsoever and without regard to the termination of
this Credit Agreement or the Commitments hereunder, the existence of a
Default or Event of Default or the acceleration of the obligations of
the Borrower hereunder and shall be made without any offset,
abatement, withholding or reduction whatsoever. Simultaneously with
the making of each such payment by a Lender to the Issuing Lender,
such Lender shall, automatically and without any further action on the
part of the Issuing Lender or such Lender, acquire a participation in
an amount equal to such payment (excluding the portion of such payment
constituting interest owing to the Issuing Lender) in the related
unreimbursed drawing portion of the LOC Obligation and in the interest
thereon and in the related LOC Documents, and shall have a claim
against the Borrower with respect thereto.
(e) Repayment with Revolving Loans. On any day on which
the Borrower shall have requested, or been deemed to have requested, a
Revolving Loan advance to reimburse a drawing under a Letter of
Credit, the Agent shall give notice to the Lenders that a Revolving
Loan has been requested or deemed requested by the Borrower to be made
in connection with a drawing under a Letter of Credit, in which case a
Revolving Loan advance comprised solely of Base Rate Loans shall be
immediately made to the Borrower by all Lenders (notwithstanding any
termination of the Commitments pursuant to Section 9.2) pro rata based
on the respective Revolving Commitment Percentages of the Lenders
(determined before giving effect to any termination of the Commitments
pursuant to Section 9.2) and the proceeds thereof shall be paid
directly to the Issuing Lender for application to the respective LOC
Obligations. Each such Lender hereby irrevocably agrees to make its
pro rata share of each such Revolving Loan immediately upon any such
request
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or deemed request in the amount, in the manner and on the date
specified in the preceding sentence notwithstanding (i) the amount of
such borrowing may not comply with the minimum amount for advances of
Revolving Loans otherwise required hereunder, (ii) whether any
conditions specified in Section 5.2 are then satisfied, (iii) whether
a Default or an Event of Default then exists, (iv) failure for any
such request or deemed request for Revolving Loan to be made by the
time otherwise required hereunder, (v) whether the date of such
borrowing is a date on which Revolving Loans are otherwise permitted
to be made hereunder or (vi) any termination of the Commitments
relating thereto immediately prior to or contemporaneously with such
borrowing. In the event that any Revolving Loan cannot for any reason
be made on the date otherwise required above (including, without
limitation, as a result of the commencement of a proceeding under the
Bankruptcy Code with respect to the Borrower or any other Credit
Party), then each such Lender hereby agrees that it shall forthwith
purchase (as of the date such borrowing would otherwise have occurred,
but adjusted for any payments received from the Borrowers on or after
such date and prior to such purchase) from the Issuing Lender such
participation in the outstanding LOC Obligations as shall be necessary
to cause each such Lender to share in such LOC Obligations ratably
(based upon the respective Revolving Commitment Percentages of the
Lenders (determined before giving effect to any termination of the
Commitments pursuant to Section 9.2)), provided that at the time any
purchase of participation pursuant to this sentence is actually made,
the purchasing Lender shall be required to pay to the Issuing Lender,
to the extent not paid to the Issuing Lender by the Borrowers in
accordance with the terms of subsection (d) hereof, interest on the
principal amount of participation purchased for each day from the day
upon which such borrowing would otherwise have occurred to the date of
payment for such participation, at the rate equal to, if paid within
two (2) Business Days of the date of the Revolving Loan advance, the
Federal Funds Rate, and thereafter at a rate equal to the Base Rate.
(f) Designation of Subsidiaries as Account Parties.
Notwithstanding anything to the contrary set forth in this Credit
Agreement, including without limitation Section 2.2(a) hereof, a
Letter of Credit issued hereunder may contain a statement to the
effect that such Letter of Credit is issued for the account of a
Subsidiary of the Borrower, provided that notwithstanding such
statement, the Borrower shall be the actual account party for all
purposes of this Credit Agreement for such Letter of Credit and such
statement shall not affect the Borrower's reimbursement obligations
hereunder with respect to such Letter of Credit.
(g) Renewal, Extension. The renewal or extension of any
Letter of Credit shall, for purposes hereof, be treated in all
respects the same as the issuance of a new Letter of Credit hereunder.
(h) Uniform Customs and Practices. The Issuing Lender
may have the Letters of Credit be subject to The Uniform Customs and
Practice for Documentary Credits, as published as of the date of issue
by the International Chamber of Commerce (the "UCP"), in which case
the UCP may be incorporated therein and deemed in all respects to be a
part thereof.
(i) Indemnification; Nature of Issuing Lender's
Duties. (i) In addition to its other obligations under this
Section 2.2, the Borrower hereby agrees to protect, indemnify,
pay and save the Issuing Lender harmless from and against any
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and all claims, demands, liabilities, damages, losses, costs,
charges and expenses (including reasonable attorneys' fees)
that the Issuing Lender may incur or be subject to as a
consequence, direct or indirect, of (A) the issuance of any
Letter of Credit or (B) the failure of the Issuing Lender to
honor a drawing under a Letter of Credit as a result of any
act or omission, whether rightful or wrongful, of any present
or future de jure or de facto government or governmental
authority (all such acts or omissions, herein called
"Government Acts").
(ii) As between the Borrower and the Issuing
Lender, the Borrower shall assume all risks of the acts,
omissions or misuse of any Letter of Credit by the beneficiary
thereof. The Issuing Lender shall not be responsible: (A)
for the form, validity, sufficiency, accuracy, genuineness or
legal effect of any document submitted by any party in
connection with the application for and issuance of any Letter
of Credit, even if it should in fact prove to be in any or all
respects invalid, insufficient, inaccurate, fraudulent or
forged; (B) for the validity or sufficiency of any instrument
transferring or assigning or purporting to transfer or assign
any Letter of Credit or the rights or benefits thereunder or
proceeds thereof, in whole or in part, that may prove to be
invalid or ineffective for any reason; (C) for errors,
omissions, interruptions or delays in transmission or delivery
of any messages, by mail, cable, telegraph, telex or
otherwise, whether or not they be in cipher; (D) for any loss
or delay in the transmission or otherwise of any document
required in order to make a drawing under a Letter of Credit
or of the proceeds thereof; and (E) for any consequences
arising from causes beyond the control of the Issuing Lender,
including, without limitation, any Government Acts. None of
the above shall affect, impair, or prevent the vesting of the
Issuing Lender's rights or powers hereunder.
(iii) In furtherance and extension and not in
limitation of the specific provisions hereinabove set forth,
any action taken or omitted by the Issuing Lender, under or in
connection with any Letter of Credit or the related
certificates, if taken or omitted in good faith, shall not put
such Issuing Lender under any resulting liability to the
Borrower or any other Credit Party. It is the intention of
the parties that this Credit Agreement shall be construed and
applied to protect and indemnify the Issuing Lender against
any and all risks involved in the issuance of the Letters of
Credit, all of which risks are hereby assumed by the Borrower
(on behalf of itself and each of the other Credit Parties),
including, without limitation, any and all Government Acts.
The Issuing Lender shall not, in any way, be liable for any
failure by the Issuing Lender or anyone else to pay any
drawing under any Letter of Credit as a result of any
Government Acts or any other cause beyond the control of the
Issuing Lender.
(iv) Nothing in this subsection (i) is intended to
limit the reimbursement obligations of the Borrower contained
in subsection (d) above. The obligations of the Borrower
under this subsection (i) shall survive the termination of
this Credit Agreement. No act or omissions of any current or
prior beneficiary of a Letter of
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<PAGE> 40
Credit shall in any way affect or impair the rights of the
Issuing Lender to enforce any right, power or benefit under
this Credit Agreement.
(v) Notwithstanding anything to the contrary
contained in this subsection (i), the Borrower shall have no
obligation to indemnify the Issuing Lender in respect of any
liability incurred by the Issuing Lender (A) arising solely
out of the negligence or willful misconduct of the Issuing
Lender, as determined by a court of competent jurisdiction, or
(B) caused by the Issuing Lender's failure to pay under any
Letter of Credit after presentation to it of a request
strictly complying with the terms and conditions of such
Letter of Credit, as determined by a court of competent
jurisdiction, unless such payment is prohibited by any law,
regulation, court order or decree.
(j) Responsibility of Issuing Lender. It is expressly
understood and agreed that the obligations of the Issuing Lender
hereunder to the Lenders are only those expressly set forth in this
Credit Agreement and that the Issuing Lender shall be entitled to
assume that the conditions precedent set forth in Section 5.2 have
been satisfied unless it shall have acquired actual knowledge that any
such condition precedent has not been satisfied; provided, however,
that nothing set forth in this Section 2.2 shall be deemed to
prejudice the right of any Lender to recover from the Issuing Lender
any amounts made available by such Lender to the Issuing Lender
pursuant to this Section 2.2 in the event that it is determined by a
court of competent jurisdiction that the payment with respect to a
Letter of Credit constituted negligence or willful misconduct on the
part of the Issuing Lender.
(k) Conflict with LOC Documents. In the event of any
conflict between this Credit Agreement and any LOC Document, this
Credit Agreement shall control.
2.3 SWINGLINE LOAN SUBFACILITY.
(a) Swingline Commitment. Subject to the terms and
conditions hereof and in reliance upon the representations and
warranties herein set forth, the Swingline Lender, in its individual
capacity, agrees to make certain revolving credit loans in Dollars
(each a "Swingline Loan" and, collectively, the "Swingline Loans") to
the Borrower from time to time from the Closing Date until the
Maturity Date for the purposes hereinafter set forth; provided,
however, (i) the aggregate amount of Swingline Loans outstanding at
any time shall not exceed FIVE MILLION DOLLARS ($5,000,000.00) (the
"Swingline Committed Amount"), and (ii) the aggregate principal amount
of outstanding Revolving Loans plus the Dollar Amount (as determined
as of the most recent Determination Date) of the aggregate principal
amount of outstanding Foreign Currency Loans plus the aggregate
principal amount of outstanding Swingline Loans plus LOC Obligations
outstanding shall not exceed the lesser of (a) the Revolving Committed
Amount and (b) the Borrowing Base. Swingline Loans hereunder shall
be made as Base Rate Loans and may be repaid and reborrowed in
accordance with the provisions hereof.
35
<PAGE> 41
(b) Swingline Loan Advances.
(i) Notices; Disbursement. Whenever the Borrower
desires a Swingline Loan advance hereunder it shall give
written notice (or telephone notice promptly confirmed in
writing) to the Swingline Lender not later than 11:00 A.M.
(Dallas, Texas time) on the Business Day of the requested
Swingline Loan advance. Each such notice shall be irrevocable
and shall specify (A) that a Swingline Loan advance is
requested, (B) the date of the requested Swingline Loan
advance (which shall be a Business Day) and (C) the principal
amount of the Swingline Loan advance requested. Each
Swingline Loan shall have such maturity date as the Swingline
Lender and the Borrower shall agree upon receipt by the
Swingline Lender of any such notice from the Borrower. The
Swingline Lender shall initiate the transfer of funds
representing the Swingline Loan advance to the Borrower by
2:00 P.M. (Dallas, Texas time) on the Business Day of the
requested borrowing.
(ii) Minimum Amounts. Each Swingline Loan shall
be in a minimum principal amount of $100,000 and in integral
multiples of $100,000 in excess thereof.
(iii) Repayment of Swingline Loans. The principal
amount of all Swingline Loans shall be due and payable on the
earlier of (A) the maturity date agreed to by the Swingline
Lender and the Borrower with respect to such Loan (which
maturity date shall not be a date more than seven (7) Business
Days from the date of advance thereof) or (B) the Maturity
Date. The Swingline Lender may, at any time, in its sole
discretion, by written notice to the Borrower and the Lenders,
demand repayment of its Swingline Loans by way of a Revolving
Loan advance, in which case the Borrower shall be deemed to
have requested a Revolving Loan advance comprised solely of
Base Rate Loans in the amount of such Swingline Loans;
provided, however, that any such demand shall be deemed to
have been given one Business Day prior to the Maturity Date
and on the date of the occurrence of any Event of Default
described in Section 9.1 and upon acceleration of the
indebtedness hereunder and the exercise of remedies in
accordance with the provisions of Section 9.2. Each Lender
hereby irrevocably agrees to make its Revolving Commitment
Percentage of each such Revolving Loan available in the
amount, in the manner and on the date specified in the
preceding sentence notwithstanding (I) the amount of such
borrowing may not comply with the minimum amount for advances
of Revolving Loans otherwise required hereunder, (II) whether
any conditions specified in Section 5.2 are then satisfied,
(III) whether a Default or an Event of Default then exists,
(IV) failure of any such request or deemed request for
Revolving Loan to be made by the time otherwise required
hereunder, (V) whether the date of such borrowing is a date on
which Revolving Loans are otherwise permitted to be made
hereunder or (VI) any termination of the Commitments relating
thereto immediately prior to or contemporaneously with such
borrowing. In the event that any Revolving Loan
36
<PAGE> 42
cannot for any reason be made on the date otherwise required
above (including, without limitation, as a result of the
commencement of a proceeding under the Bankruptcy Code with
respect to the Borrower or any other Credit Party), then each
Lender hereby agrees that it shall forthwith purchase (as of
the date such borrowing would otherwise have occurred, but
adjusted for any payments received from the Borrower on or
after such date and prior to such purchase) from the Swingline
Lender such participations in the outstanding Swingline Loans
as shall be necessary to cause each such Lender to share in
such Swingline Loans ratably based upon its Revolving
Commitment Percentage of the Revolving Committed Amount
(determined before giving effect to any termination of the
Commitments pursuant to Section 3.4 or Section 9.2), provided
that (A) all interest payable on the Swingline Loans shall be
for the account of the Swingline Lender until the date as of
which the respective participation is purchased and (B) at the
time any purchase of participations pursuant to this sentence
is actually made, the purchasing Lender shall be required to
pay to the Swingline Lender, to the extent not paid to the
Swingline Lender by the Borrower in accordance with the terms
of subsection (c)(ii) hereof, interest on the principal amount
of participation purchased for each day from the day upon
which such borrowing would otherwise have occurred to the date
of payment for such participation, at the rate equal to the
Federal Funds Rate.
(c) Interest on Swingline Loans. Subject to the
provisions of Section 3.1, each Swingline Loan shall bear interest at
a per annum rate equal to the Base Rate plus the Applicable
Percentage. Interest on Swingline Loans shall be payable in arrears
on each applicable Interest Payment Date (or at such other times as
may be specified herein).
(d) Swingline Note. The Swingline Loans shall be
evidenced by a duly executed promissory note of the Borrower to the
Swingline Lender in substantially the form of Schedule 2.3(d).
2.4 FOREIGN CURRENCY LOAN SUBFACILITY.
(a) Foreign Currency Commitment. Subject to the terms
and conditions hereof and in reliance upon the representations and
warranties set forth herein, each Lender severally agrees to make
available to the Borrower such Lender's Foreign Currency Commitment
Percentage of revolving credit loans in the Available Foreign
Currencies requested by the Borrower ("Foreign Currency Loans") from
time to time from the date five (5) Business Days subsequent to the
Closing Date until the Maturity Date, or such earlier date as the
Foreign Currency Commitments shall have been terminated as provided
herein for the purposes hereinafter set forth; provided, however, that
the Dollar Amount (as determined as of the most recent Determination
Date) of the aggregate amount of Foreign Currency Loans outstanding at
any time shall not exceed FIVE MILLION DOLLARS ($5,000,000.00) (the
"Foreign Currency Committed Amount"); provided, further, (i) with
regard to each Lender individually, such Lender's outstanding Foreign
Currency Loans shall not exceed such Lender's Foreign Commitment
Percentage of the
37
<PAGE> 43
Foreign Currency Committed Amount, and (ii) with regard to the Lenders
collectively, the aggregate principal amount of outstanding Revolving
Loans plus the Dollar Amount (as determined as of the most recent
Determination Date) of the aggregate principal amount of outstanding
Foreign Currency Loans plus the aggregate principal amount of
outstanding Swingline Loans plus LOC Obligations outstanding shall not
exceed the lesser of (a) the Revolving Committed Amount and (b) the
Borrowing Base. Foreign Currency Loans shall consist solely of
Eurodollar Loans and may be repaid and reborrowed in accordance with
the provisions hereof; provided, however, that (x) during the Initial
Interest Rate Period, all Eurodollar Loans shall have an Interest
Period of one (1) month and (y) no more than 10 Eurodollar Loans shall
be outstanding hereunder at any time. For purposes hereof, Eurodollar
Loans with different Interest Periods and/or in different currencies
shall be considered as separate Eurodollar Loans, even if they begin
on the same date, although borrowings, extensions and conversions may,
in accordance with the provisions hereof, be combined at the end of
existing Interest Periods to constitute a new Eurodollar Loan with a
single Interest Period and in the same currency.
(b) Foreign Currency Loan Borrowings.
(i) Notice of Borrowing. The Borrower shall
request a Foreign Currency Loan borrowing by written notice
(or telephone notice promptly confirmed in writing) to the
Agent not later than 11:00 A.M. (Dallas, Texas time) on the
third Business Day prior to the date of the requested
borrowing. Each such request for borrowing shall be
irrevocable and shall specify (A) that a Foreign Currency Loan
is requested, (B) the requested Available Foreign Currency,
(C) the date of the requested borrowing (which shall be a
Business Day), (D) the aggregate principal amount to be
borrowed and (E) after the Initial Interest Rate Period, the
Interest Period(s) therefor. If the Borrower shall fail to
specify in any such Notice of Borrowing an applicable Interest
Period, then such notice shall be deemed to be a request for
an Interest Period of one month. The Agent shall give notice
to each Lender promptly upon receipt of each Notice of
Borrowing, the contents thereof and each such Lender's share
of any borrowing to be made pursuant thereto.
(ii) Minimum Amounts. Each Foreign Currency Loan
shall be in a minimum aggregate principal amount equal to the
applicable Foreign Currency Equivalent of $2,000,000 and
integral multiples of the applicable Foreign Currency
Equivalent of $100,000 in excess thereof (or the remaining
amount of the Foreign Currency Commitment, if less).
(iii) Advances. Each Lender will make its Foreign
Currency Commitment Percentage of each Foreign Currency Loan
borrowing available to the Agent by 1:00 P.M., local time in
the place where such deposit is required to be made by the
succeeding terms hereof, on the date specified in the
applicable Notice of Borrowing by deposit with the Agent, at
the same place and same account specified in Section 3.15(b)
for payments by the Borrower in the
38
<PAGE> 44
applicable Available Foreign Currency, of same day funds in
the applicable Available Foreign Currency. Such deposit will
be made to such accounts as the Agent shall specify from time
to time by notice to the Lenders. To the extent funds are
received from the Lenders, the Agent shall promptly make such
funds available to the Borrower by wire transfer to such
accounts as the Borrower shall have specified to the Agent.
(c) Repayment. The principal amount of all Foreign
Currency Loans shall be due and payable in full in the applicable
Available Foreign Currency on the Maturity Date.
(d) Interest. Subject to the provisions of Section 3.1,
Foreign Currency Loans shall bear interest at a per annum rate equal
to the Eurodollar Rate plus the Applicable Percentage. Interest on
Foreign Currency Loans shall be payable (in the applicable Available
Foreign Currency) in arrears on each applicable Interest Payment Date
(or at such other times as may be specified herein).
(e) Foreign Currency Notes. The Foreign Currency Loans
made by each Lender shall be evidenced by a duly executed promissory
note of the Borrower to each Lender in substantially the form of
Schedule 2.4(e).
2.5 TRANCHE A TERM LOAN.
(a) Tranche A Term Loan Commitment. Subject to and upon
the terms and conditions and relying upon the representations and
warranties herein set forth, each Lender agrees, severally and not
jointly, to make available to the Borrower on the Closing Date such
Lender's Tranche A Term Loan Commitment Percentage of a term loan in
Dollars (the "Tranche A Term Loan") in the aggregate principal amount
of FIFTEEN MILLION DOLLARS ($15,000,000.00) for the purposes
hereinafter set forth. The Tranche A Term Loan may consist of Base
Rate Loans or Eurodollar Loans, or a combination thereof, as the
Borrower may request; provided, however, that (x) during the Initial
Interest Rate Period, all Eurodollar Loans shall have an Interest
Period of one (1) month and (y) no more than 10 Eurodollar Loans shall
be outstanding hereunder at any time. For purposes hereof, Eurodollar
Loans with different Interest Periods and/or in different currencies
shall be considered as separate Eurodollar Loans, even if they begin
on the same date, although borrowings, extensions and conversions may,
in accordance with the provisions hereof, be combined at the end of
existing Interest Periods to constitute a new Eurodollar Loan with a
single Interest Period and in the same currency.
(b) Borrowing Procedures. The Borrower shall submit an
appropriate Notice of Borrowing to the Agent not later than 11:00 A.M.
(Dallas, Texas time) on the Business Day prior to the Closing Date in
the case of Base Rate Loans, and on the third Business Day prior to
the Closing Date in the case of Eurodollar Loans. Such Notice of
Borrowing shall be irrevocable and shall specify (A) that a Tranche A
Term Loan is requested and (B) whether the advance shall be comprised
of Base Rate Loans, Eurodollar Loans or a combination thereof, and
(after the Initial Interest Rate Period) if Eurodollar Loans are
39
<PAGE> 45
requested, the Interest Period(s) therefor. If the Borrower shall
fail to specify in any such Notice of Borrowing (I) an applicable
Interest Period in the case of a Eurodollar Loan, then such notice
shall be deemed to be a request for an Interest Period of one month or
(II) the type of Tranche A Term Loan advance requested, then such
notice shall be deemed to be a request for a Base Rate Loan hereunder.
The Agent shall give notice to each affected Lender promptly upon
receipt of such Notice of Borrowing pursuant to this Section
2.5(b)(i), the contents thereof and each such Lender's share of any
borrowing to be made pursuant thereto. Each Lender will make its
Tranche A Term Loan Commitment Percentage available to the Agent for
the account of the Borrower as specified in Section 3.15(b), or in
such other manner as the Agent may specify in writing, by 1:00 P.M.
(Dallas, Texas time) on the Closing Date in Dollars and in funds
immediately available to the Agent.
(c) Minimum Amounts. Each Eurodollar Loan or Base Rate
Loan that is part of the Tranche A Term Loan shall be in a minimum
aggregate principal amount that is not less than $2,000,000 and
integrals of $100,000.
(d) Repayment of Tranche A Term Loan. The principal
amount of the Tranche A Term Loan shall be repaid in twenty (20)
consecutive quarterly installments as follows:
<TABLE>
<CAPTION>
Tranche A Principal
Payment Date Amortization Payment
------------ --------------------
<S> <C>
December 26, 1997 $750,000
March 27, 1998 $750,000
June 26, 1998 $750,000
September 25, 1998 $750,000
December 31, 1998 $750,000
April 2, 1999 $750,000
July 2, 1999 $750,000
October 1, 1999 $750,000
December 31, 1999 $750,000
March 31, 2000 $750,000
June 30, 2000 $750,000
September 29, 2000 $750,000
December 29, 2000 $750,000
March 30, 2001 $750,000
June 29, 2001 $750,000
September 28, 2001 $750,000
December 28, 2001 $750,000
March 29, 2002 $750,000
June 28, 2002 $750,000
Maturity Date Remaining principal
</TABLE>
40
<PAGE> 46
(d) Interest. Subject to the provisions of Section 3.1,
the Tranche A Term Loan shall bear interest at a per annum rate equal
to:
(A) Base Rate Loans. During such periods as the
Tranche A Term Loan (or any portion thereof) shall consist of
Base Rate Loans, the Base Rate plus the Applicable Percentage.
(B) Eurodollar Loans. During such periods as the
Tranche A Term Loan (or any portion thereof) shall consist of
Eurodollar Loans, the Eurodollar Rate plus the Applicable
Percentage.
Interest on the Tranche A Term Loan shall be payable in arrears on
each applicable Interest Payment Date (or at such other times as may
be specified herein).
(e) Tranche A Term Notes. The portion of the Tranche A
Term Loan made by each Lender shall be evidenced by a duly executed
promissory note of the Borrower to each such Lender in an original
principal amount equal to such Lender's Tranche A Commitment
Percentage of the Tranche A Term Loan and substantially in the form of
Schedule 2.5(e).
2.6 TRANCHE B TERM LOAN.
(a) Tranche B Term Loan Commitment. Subject to and upon
the terms and conditions and relying upon the representations and
warranties herein set forth, each Lender agrees, severally and not
jointly, to make available to the Borrower on the Closing Date such
Lender's Tranche B Term Loan Commitment Percentage of a term loan in
Dollars (the "Tranche B Term Loan") in the aggregate principal amount
of FORTY MILLION DOLLARS ($40,000,000.00) for the purposes hereinafter
set forth. The Tranche B Term Loan may consist of Base Rate Loans or
Eurodollar Loans, or a combination thereof, as the Borrower may
request; provided, however, that (x) during the Initial Interest Rate
Period, all Eurodollar Loans shall have an Interest Period of one (1)
month and (y) no more than 10 Eurodollar Loans shall be outstanding
hereunder at any time. For purposes hereof, Eurodollar Loans with
different Interest Periods and/or in different currencies shall be
considered as separate Eurodollar Loans, even if they begin on the
same date, although borrowings, extensions and conversions may, in
accordance with the provisions hereof, be combined at the end of
existing Interest Periods to constitute a new Eurodollar Loan with a
single Interest Period and in the same currency. Each Lender will
make its Tranche B Term Loan Commitment Percentage of the Tranche B
Term Loan available to the Agent on the Closing Date.
(b) Borrowing Procedures. The Borrower shall submit an
appropriate Notice of Borrowing to the Agent not later than 11:00 A.M.
(Dallas, Texas time) on the Business Day prior to the Closing Date,
with respect to the portion of the Tranche B Term Loan initially
consisting of Base Rate Loans, or on the third Business Day prior to
the Closing Date, with respect to the portion of the Tranche B Term
Loan initially consisting of one or
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<PAGE> 47
more Eurodollar Loans, which Notice of Borrowing shall be irrevocable
and shall specify (i) that the funding of the Tranche B Term Loan is
requested and (ii) the Interest Period(s) therefor. If the Borrower
shall fail to deliver such Notice of Borrowing to the Agent at least
three (3) Business Days prior to the Closing Date then the full amount
of the Tranche B Term Loan shall be disbursed on the Closing Date for
an Interest Period of one month. Each Lender shall make its Tranche B
Commitment Percentage of the Tranche B Term Loan available to the
Agent for the account of the Borrower as specified in Section 3.15(b),
or in such other manner as the Agent may designate in writing, by 1:00
P.M. (Dallas, Texas time) on the Closing Date in Dollars and in funds
immediately available to the Agent.
(c) Minimum Amounts. Each Eurodollar Loan or Base Rate
Loan that is part of the Tranche B Term Loan shall be in a minimum
aggregate principal amount that is not less than $2,000,000 and
integrals of $100,000 (or the then remaining principal balance of the
Tranche B Term Loan, if less).
(d) Repayment of Tranche B Term Loan. The principal
amount of the Tranche B Term Loan shall be repaid in twenty-eight (28)
consecutive quarterly installments as follows:
<TABLE>
<CAPTION>
Tranche B Principal
Payment Date Amortization Payment
------------ --------------------
<S> <C>
December 26, 1997 $250,000
March 27, 1998 $250,000
June 26, 1998 $250,000
September 25, 1998 $250,000
December 31, 1998 $250,000
April 2, 1999 $250,000
July 2, 1999 $250,000
October 1, 1999 $250,000
December 31, 1999 $250,000
March 31, 2000 $250,000
June 30, 2000 $250,000
September 29, 2000 $250,000
December 29, 2000 $250,000
March 30, 2001 $250,000
June 29, 2001 $250,000
September 28, 2001 $250,000
December 28, 2001 $250,000
March 29, 2002 $250,000
June 28, 2002 $250,000
September 27, 2002 $250,000
December 27, 2002 $4,375,000
March 28, 2003 $4,375,000
</TABLE>
42
<PAGE> 48
<TABLE>
<S> <C>
June 27, 2003 $4,375,000
September 26, 2003 $4,375,000
December 26, 2003 $4,375,000
March 26, 2004 $4,375,000
June 25, 2004 $4,375,000
Maturity Date Remaining principal
</TABLE>
(e) Interest. Subject to the provisions of Section 3.1,
the Tranche B Term Loan shall bear interest at a per annum rate equal
to:
(A) Base Rate Loans. During such periods as the
Tranche B Term Loan (or any portion thereof) shall consist of
Base Rate Loans, the Base Rate plus the Applicable Percentage.
(B) Eurodollar Loans. During such periods as the
Tranche B Term Loan (or any portion thereof) shall consist of
Eurodollar Loans, the Eurodollar Rate plus the Applicable
Percentage.
Interest on the Tranche B Term Loan shall be payable in arrears on
each applicable Interest Payment Date (or at such other times as may
be specified herein).
(f) Tranche B Term Notes. The portion of the Tranche B
Term Loan made by each Lender shall be evidenced by a duly executed
promissory note of the Borrower to each such Lender in an original
principal amount equal to such Lender's Tranche B Term Loan Commitment
Percentage of the Tranche B Term Loan and substantially in the form of
Schedule 2.6(f).
SECTION 3
OTHER PROVISIONS RELATING TO CREDIT FACILITIES
3.1 DEFAULT RATE.
Upon the occurrence, and during the continuance, of an Event of
Default, the principal of and, to the extent permitted by law, interest on the
Loans and any other amounts owing hereunder or under the other Credit Documents
shall bear interest, payable on demand, at a per annum rate 2% greater than the
rate which would otherwise be applicable (or if no rate is applicable, whether
in respect of interest, fees or other amounts, then 2% greater than the Base
Rate).
3.2 EXTENSION AND CONVERSION.
Subject to the terms of Section 5.2, the Borrower shall have the
option, on any Business Day, to extend existing Loans into a subsequent
permissible Interest Period or to convert Loans into Loans of another interest
rate type; provided, however, that (i) except as provided in Section 3.9,
Eurodollar Loans may be
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<PAGE> 49
converted into Base Rate Loans only on the last day of the Interest Period
applicable thereto, (ii) Eurodollar Loans may be extended, and Base Rate Loans
may be converted into Eurodollar Loans, only if no Default or Event of Default
is in existence on the date of extension or conversion, (iii) Loans extended
as, or converted into, Eurodollar Loans shall be subject to the terms of the
definition of "Interest Period" set forth in Section 1.1 and shall be in such
minimum amounts as provided in Section 2.1(b)(ii), Section 2.4(b)(ii), 2.5(c)
or 2.6(c), as applicable, (iv) no more than 10 Eurodollar Loans shall be
outstanding hereunder at any time (it being understood that, for purposes
hereof, Eurodollar Loans with different Interest Periods and/or in different
currencies shall be considered as separate Eurodollar Loans, even if they begin
on the same date, although borrowings, extensions and conversions may, in
accordance with the provisions hereof, be combined at the end of existing
Interest Periods to constitute a new Eurodollar Loan with a single Interest
Period and in the same currency), (v) any request for extension or conversion
of a Eurodollar Loan which shall fail to specify an Interest Period shall be
deemed to be a request for an Interest Period of one month, (vi) during the
Initial Interest Rate Period, all Eurodollar Loans shall have an Interest
Period of one (1) month and (vii) Swingline Loans may not be extended or
converted pursuant to this Section 3.2. Each such extension or conversion
shall be effected by the Borrower by giving a Notice of Extension/Conversion
(or telephone notice promptly confirmed in writing) to the Agent prior to 11:00
A.M. (Dallas, Texas time) on the Business Day of, in the case of the
conversion of a Eurodollar Loan into a Base Rate Loan and on the third Business
Day prior to, in the case of the extension of a Eurodollar Loan as, or
conversion of a Base Rate Loan into, a Eurodollar Loan, the date of the
proposed extension or conversion, specifying the date of the proposed extension
or conversion, the Loans to be so extended or converted, the types of Loans
into which such Loans are to be converted and, if appropriate, the applicable
Interest Periods with respect thereto. Each request for extension or
conversion shall constitute a representation and warranty by the Borrower of
the matters specified in subsections (b), (c), (d), (e) and (f) of Section
5.2. In the event the Borrower fails to request extension or conversion of any
Eurodollar Loan in accordance with this Section, or any such conversion or
extension is not permitted or required by this Section, then (i) in the case of
any Eurodollar Loan which is not a Foreign Currency Loan, such Eurodollar Loan
shall be automatically converted into a Base Rate Loan at the end of the
Interest Period applicable thereto, and (ii) in the case of any Foreign
Currency Loan, such Eurodollar Loan shall be automatically continued as a
Eurodollar Loan in the same Available Foreign Currency for an Interest Period
of one month. The Agent shall give each Lender notice as promptly as
practicable of any such proposed extension or conversion affecting any Loan.
3.3 PREPAYMENTS.
(a) Voluntary Prepayments. The Borrower shall have the
right to prepay Loans in whole or in part from time to time without
premium or penalty; provided, however, that (i) Eurodollar Loans may
only be prepaid on three Business Days' prior written notice to the
Agent and specifying the applicable Loans to be prepaid, (ii) each
such partial prepayment of Loans (other than Swingline Loans) shall be
in a minimum principal amount of $2,000,000 (or the applicable Foreign
Currency Equivalent thereof) and integral multiples of $100,000 (or
the applicable Foreign Currency Equivalent thereof) in excess thereof
and (iii) be applied first to Base Rate Loans, if any, and then to
Eurodollar Loans in direct order of Interest Period maturities.
Subject to the foregoing terms, amounts prepaid under this Section
3.3(a) shall be applied as the Borrower may
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elect. All prepayments made pursuant to this Section 3.3(a) shall (i)
be subject to Section 3.12 and (ii) be accompanied by interest on the
principal amount prepaid through the date of prepayment.
(b) Mandatory Prepayments.
(i) If at any time the sum of the aggregate
principal amount of outstanding Revolving Loans plus the
Dollar Amount (as determined as of the most recent
Determination Date) of the aggregate principal amount of
outstanding Foreign Currency Loans plus the aggregate
principal amount of outstanding Swingline Loans plus LOC
Obligations outstanding shall exceed the lesser of (a) the
Revolving Committed Amount and (b) the Borrowing Base, the
Borrower promises to prepay immediately the outstanding
principal balance on the Revolving Loans in an amount
sufficient to eliminate such excess.
(ii) If on any Determination Date the Dollar
Amount of the aggregate Foreign Currency Loans outstanding
exceeds (as the result of fluctuations in applicable foreign
exchange rates or otherwise) the then Foreign Currency
Committed Amount, the Borrower promises to make a mandatory
prepayment to the Agent in an aggregate Dollar Amount equal to
the excess of
(x) the amount equal to the Dollar Amount
of the aggregate Foreign Currency Loans outstanding
over
(y) the Foreign Currency Committed
Amount.
(iii) Immediately upon the occurrence of any Asset
Disposition Prepayment Event, the Borrower shall prepay the
Loans in an aggregate amount equal to the Net Proceeds of the
related Asset Disposition not applied (or caused to be
applied) by the Borrower during the related Application Period
to the purchase, acquisition or construction of Alternative
Assets as contemplated by the terms of Section 8.4(b)(v).
(iv) Within 120 days after the end of each fiscal
year of the Borrower and its Subsidiaries (commencing with the
fiscal year ending December 28, 1997), the Borrower shall
prepay the Loans in an aggregate amount equal to 75% of the
Excess Cash Flow for such prior fiscal year.
(v) All prepayments made pursuant to this Section
3.3(b) shall (i) be subject to Section 3.12, (ii) in the case
of prepayments made pursuant to Section 3.3(b)(iii) or Section
3.3(b)(iv), be applied first pro rata to the Tranche A Term
Loan and the Tranche B Term Loan (ratably to the remaining
principal installments thereof) and then to the Revolving
Loans (with a corresponding reduction in the
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Revolving Committed Amount), (iii) subject to the terms of
clause (ii) above, be applied first to Base Rate Loans, if
any, and then to Eurodollar Loans in direct order of Interest
Period maturities and (iv) be accompanied by interest on the
principal amount prepaid through the date of prepayment.
The Borrower will provide notice to the Agent of any prepayment by 11:00 A.M.
(Dallas, Texas time) on the day prior to the date of prepayment. Amounts paid
on the Revolving Loans, the Swingline Loans or the Foreign Currency Loans may
be reborrowed in accordance with the provisions hereof. Amounts prepaid on the
Tranche A Term Loan or the Tranche B Term Loan may not be reborrowed.
3.4 TERMINATION AND REDUCTION OF COMMITTED AMOUNTS; INCREASE OF
COMMITMENT.
(a) Termination and Reduction of Commitments.
(i) The Borrower may from time to time
permanently reduce or terminate the Revolving Committed Amount
in whole or in part (in minimum aggregate amounts of
$2,000,000 or in integral multiples of $1,000,000 in excess
thereof (or, if less, the full remaining amount of the then
applicable Revolving Committed Amount)) upon five Business
Days' prior written notice to the Agent; provided, however, no
such termination or reduction shall be made which would reduce
the Revolving Committed Amount to an amount less than the
aggregate principal amount of outstanding Revolving Loans plus
the Dollar Amount (as determined as of the most recent
Determination Date) of the aggregate principal amount of
outstanding Foreign Currency Loans plus the aggregate
principal amount of outstanding Swingline Loans plus LOC
Obligations outstanding. The Agent shall promptly notify each
of the Lenders of receipt by the Agent of any notice from the
Borrower pursuant to this Section 3.4(a).
(ii) The Revolving Commitments of the Lenders, the
Foreign Currency Commitments of the Lenders, the Swingline
Commitment of the Swingline Lender and the LOC Commitment of
the Issuing Lender shall automatically terminate on the
Maturity Date.
(iii) The Borrower shall pay to the Agent for the
account of the Lenders in accordance with the terms of Section
3.5(a), on the date of each termination or reduction of the
Revolving Committed Amount, the Unused Fee on the amount of
the Revolving Committed Amount so terminated or reduced
accrued through the date of such termination or reduction.
(b) Increase in Commitments. The Borrower shall have the
right upon at least fifteen (15) Business Days' prior written notice
to the Agent to increase the Revolving Committed Amount by up to
$15,000,000, in one or more increases, at any time and from
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time to time on or after the Closing Date, subject, however, in any
such case, to satisfaction of the following conditions precedent:
(A) no Default or Event of Default has occurred
and is continuing on the date on which such Commitment
increase is to become effective;
(B) the representations and warranties set forth
in Section 6 of this Credit Agreement shall be true and
correct in all material respects on and as of the date on
which such Commitment increase is to become effective;
(C) on or before the date on which such
Commitment increase is to become effective, the Agent shall
have received, for its own account, the mutually acceptable
fees and expenses required by separate agreement of the
Borrower and the Agent to be paid in connection with such
increase;
(D) such Commitment increase shall be an integral
multiple of $1,000,000 and shall in no event be less than
$5,000,000; and
(E) such requested Commitment increase shall be
effective on such date only to the extent that, on or before
such date, (A) the Agent shall have received and accepted a
corresponding amount of Additional Commitment(s) pursuant to a
commitment letter(s) acceptable to the Agent from one or more
Lenders acceptable to the Agent and, with respect to any
Lender that is not at such time a Lender hereunder, the
Borrower and (B) each such Lender has executed an agreement in
the form of Schedule 3.4 hereto (each such agreement a "New
Commitment Agreement"), accepted in writing therein by the
Agent and, with respect to any Lender that is not at such time
a Lender hereunder, the Borrower, with respect to the
Additional Commitment of such Lender.
3.5 FEES.
(a) Unused Fee. In consideration of the Revolving
Commitments of the Lenders hereunder, the Borrower agrees to pay to
the Agent for the account of each Lender a fee (the "Unused Fee") on
the Unused Revolving Committed Amount computed at a per annum rate for
each day during the applicable Unused Fee Calculation Period
(hereinafter defined) at a rate equal to the Applicable Percentage for
Unused Fees. The Unused Fee shall commence to accrue on the Closing
Date and shall be due and payable in arrears on the last day of each
March, June, September and December (and any date that the Revolving
Committed Amount is reduced as provided in Section 3.4(a) and the
Maturity Date) for the immediately preceding quarter (or portion
thereof) (each such quarter or portion thereof for which the Unused
Fee is payable hereunder being herein referred to as an "Unused Fee
Calculation Period"), beginning with the first of such dates to occur
after the Closing Date.
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(b) Letter of Credit Fees.
(i) Standby Letter of Credit Issuance Fee. In
consideration of the issuance of standby Letters of Credit
hereunder, the Borrower promises to pay to the Agent for the
account of each Lender a fee (the "Standby Letter of Credit
Fee") on such Lender's Revolving Commitment Percentage of the
average daily maximum amount available to be drawn under each
such standby Letter of Credit computed at a per annum rate for
each day from the date of issuance to the date of expiration
equal to the Applicable Percentage for the Standby Letter of
Credit Fee. The Standby Letter of Credit Fee will be payable
quarterly in arrears on the last day of each March, June,
September and December for the immediately preceding quarter
(or a portion thereof).
(ii) Trade Letter of Credit Issuance Fee. In
consideration of the issuance of trade Letters of Credit
hereunder, the Borrower promises to pay to the Agent for the
account of each Lender a fee (the "Trade Letter of Credit
Fee") of 1% per annum on such Lender's Revolving Commitment
Percentage of the face amount of each such trade Letter of
Credit (such Trade Letter of Credit Fee in respect of any
trade Letter of Credit not to be less than $100 in the
aggregate for all the Lenders). The Trade Letter of Credit Fee
will be payable in advance upon the date of issuance of any
trade Letter of Credit.
(iii) Issuing Lender Fees. In addition to the
Standby Letter of Credit Fee payable pursuant to clause (i)
above and the Trade Letter of Credit Fee payable pursuant to
clause (ii) above, the Borrower promises to pay to the Issuing
Lender for its own account without sharing by the other
Lenders (A) a standby Letter of Credit fronting fee of 0.125%
on the average daily maximum amount available to be drawn
under each standby Letter of Credit computed at a per annum
rate for each day from the date of issuance to the date of
expiration, such fronting fee to be payable quarterly in
arrears on the last day of each March, June, September and
December for the immediately preceding quarter (or a portion
thereof), (B) a trade Letter of Credit drawing fee of $65 per
draw and (C) the customary charges from time to time of the
Issuing Lender with respect to the issuance, amendment,
transfer, administration, cancellation and conversion of, and
drawings under, such Letters of Credit (collectively, the
"Issuing Lender Fees").
3.6 EUROCURRENCY RESERVE COMPENSATION.
For so long as any Lender maintains reserves against "Eurocurrency
liabilities" (or any other category of liabilities which includes deposits by
reference to which the interest rate on any Eurodollar Loans is determined),
and, as a result, the cost to such Lender of making or maintaining any of its
Eurodollar Loans is increased, then such Lender may require the Borrower to
pay, contemporaneously with each payment of interest on such Eurodollar Loans
of such Lender, additional interest at a rate per annum up to but not exceeding
the excess of (i) (A) the applicable Eurodollar Rate divided by (B) one minus
the Eurodollar Reserve Percentage over (ii)
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the applicable Eurodollar Rate. Any Lender wishing to require payment of such
additional interest (x) shall so notify the Borrower and the Agent, in which
case such additional interest on the Eurodollar Loans of such Lender shall be
payable to such Lender at the place indicated in such notice with respect to
each Interest Period commencing at least three (3) Business Days after the
giving of such notice and (y) shall furnish to the Borrower at least five (5)
Business Days prior to each date on which interest is payable on the Eurodollar
Loans a certificate setting forth the amount to which such Lender is then
entitled under this Section 3.6 (which shall be consistent with such Lender's
good faith estimate of the level at which the related reserves are maintained
by it). Each such certificate shall be accompanied by such information as the
Borrower may reasonably request as to the computation set forth therein.
3.7 CAPITAL ADEQUACY.
If, after the date hereof, any Lender has determined that the adoption
or the becoming effective of, or any change in, or any change by any
Governmental Authority, central bank or comparable agency charged with the
interpretation or administration thereof in the interpretation or
administration of, any applicable law, rule or regulation regarding capital
adequacy, or compliance by such Lender with any request or directive regarding
capital adequacy (whether or not having the force of law) of any such
authority, central bank or comparable agency, has or would have the effect of
reducing the rate of return on such Lender's capital or assets as a consequence
of its commitments or obligations hereunder to a level below that which such
Lender could have achieved but for such adoption, effectiveness, change or
compliance (taking into consideration such Lender's policies with respect to
capital adequacy), then, upon notice from such Lender to the Borrower
accompanied by a certificate from such Lender setting forth the additional
amount or amounts to be paid to it hereunder, the Borrower shall be obligated
to pay to such Lender such additional amount or amounts as will compensate such
Lender for such reduction. Each determination by any such Lender of amounts
owing under this Section shall, absent manifest error, be conclusive and
binding on the parties hereto.
3.8 UNAVAILABILITY.
In the event, and on each occasion, that on the day two (2) Business
Days prior to the commencement of any Interest Period for a Eurodollar Loan of
any amount, Interest Period or currency, the Agent shall have determined or
shall have been notified by the Required Lenders (a) that deposits in the
relevant amount in the relevant currency and for the relevant Interest Period
are not available in the relevant market to any Lender, or that reasonable
means do not exist for ascertaining the Eurodollar Rate for any such Loan, or
(b) that the rates at which such deposits are being offered will not adequately
and fairly reflect the cost to any Lender of making or maintaining its
Eurodollar Loan during such Interest Period, the Agent shall promptly give
written or telecopy notice of such determination to the Borrower and the
Lenders. In the event of any such determination, until the Agent shall have
advised the Borrower and the Lenders that the circumstances giving rise to such
notice no longer exist, any request by the Borrower for a Eurodollar Loan of
the affected amount, Interest Period or currency, or a conversion to or
continuation of a Eurodollar Loan of the affected amount, Interest Period or
currency, shall be
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deemed rescinded. Each determination by the Agent hereunder shall be
conclusive absent manifest error.
3.9 ILLEGALITY.
(a) Notwithstanding any other provision herein, if (i) the
adoption of or any change in any Requirement of Law or in the interpretation or
application thereof occurring after the Closing Date shall make it unlawful for
any Lender to make or maintain any Eurodollar Loan or Foreign Currency Loan or
(ii) there shall have occurred any change in national or international
financial, political or economic conditions (including the imposition of or any
change in exchange controls) or currency exchange rates which would make it
impracticable for any Lender to make Loans denominated in any Available Foreign
Currency to the Borrower, as contemplated by this Credit Agreement, then, by
written notice to the Borrower and to the Agent:
(i) such Lender may declare that Eurodollar Loans
or Foreign Currency Loans (in the affected currency or
currencies), as the case may be, will not thereafter (for the
duration of such unlawfulness or impracticability) be made by
such Lender hereunder, whereupon any request for a Eurodollar
Loan or Foreign Currency Loan (in the affected currency or
currencies), as the case may be, shall, as to such Lender
only, (A) if such Loan is not a Foreign Currency Loan, be
deemed a request for a Base Rate Loan, unless such declaration
shall be subsequently withdrawn and (B) if such Loan is a
Foreign Currency Loan, be deemed to have been withdrawn,
unless such declaration shall be subsequently withdrawn; and
(ii) such Lender may require that all outstanding
Eurodollar Loans or Foreign Currency Loans (in the affected
currency or currencies), as the case may be, made by it be (A)
if such Loans are not Foreign Currency Loans, converted to
Base Rate Loans, in which event all such Eurodollar Loans
shall be automatically converted to Base Rate Loans as of the
effective date of such notice as provided in paragraph (b)
below or (B) if such Loans are Foreign Currency Loans, repaid
immediately, in which event all such Foreign Currency Loans
(in the affected currency or currencies) shall be required to
be repaid in full by the Borrower as of the effective date of
such notice as provided in paragraph (b) below.
In the event any Lender shall exercise its rights under (i) or (ii) above with
respect to any Loans which are not Foreign Currency Loans, all payments and
prepayments of principal which would otherwise have been applied to repay the
Eurodollar Loans that would have been made by such Lender or the converted
Eurodollar Loans of such Lender shall instead be applied to repay the Base Rate
Loans made by such Lender in lieu of, or resulting from the conversion, of such
Eurodollar Loans.
(b) For purposes of this Section 3.9, a notice to the
Borrower by any Lender shall be effective as to each such Loan, if
lawful, on the last day of the Interest Period
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currently applicable to such Loan; in all other cases such notice
shall be effective on the date of receipt by the Borrower.
3.10 REQUIREMENTS OF LAW.
If the adoption of or any change in any Requirement of Law or in the
interpretation or application thereof applicable to any Lender, or compliance
by any Lender with any request or directive (whether or not having the force of
law) from any central bank or other Governmental Authority, in each case made
subsequent to the Closing Date (or, if later, the date on which such Lender
becomes a Lender):
(a) shall subject such Lender to any tax of any kind
whatsoever with respect to any Letter of Credit, any Eurodollar Loans
made by it or its obligation to make Eurodollar Loans, or change the
basis of taxation of payments to such Lender in respect thereof
(except for Non-Excluded Taxes covered by Section 3.11 (including
Non-Excluded Taxes imposed solely by reason of any failure of such
Lender to comply with its obligations under Section 3.11(b)) and
changes in taxes measured by or imposed upon the overall net income,
or franchise tax (imposed in lieu of such net income tax), of such
Lender or its applicable lending office, branch, or any affiliate
thereof);
(b) shall impose, modify or hold applicable any reserve,
special deposit, compulsory loan or similar requirement against assets
held by, deposits or other liabilities in or for the account of,
advances, loans or other extensions of credit by, or any other
acquisition of funds by, any office of such Lender which is not
otherwise included in the determination of the Eurodollar Rate
hereunder; or
(c) shall impose on such Lender any other condition
(excluding any tax of any kind whatsoever);
and the result of any of the foregoing is to increase the cost to such Lender,
by an amount which such Lender deems to be material, of making, converting
into, continuing or maintaining Eurodollar Loans or issuing or participating in
Letters of Credit or to reduce any amount receivable hereunder in respect
thereof, then, in any such case, upon notice to the Borrower from such Lender,
through the Agent, in accordance herewith, the Borrower shall be obligated to
promptly pay such Lender, upon its demand, any additional amounts necessary to
compensate such Lender for such increased cost or reduced amount receivable,
provided that, in any such case, the Borrower may elect to convert the
Eurodollar Loans (other than Foreign Currency Loans) made by such Lender
hereunder to Base Rate Loans by giving the Agent at least one Business Day's
notice of such election, in which case the Borrower shall promptly pay to such
Lender, upon demand, without duplication, such amounts, if any, as may be
required pursuant to Section 3.12. If any Lender becomes entitled to claim any
additional amounts pursuant to this subsection, it shall provide prompt notice
thereof to the Borrower, through the Agent, certifying (x) that one of the
events described in this Section 3.10 has occurred and describing in reasonable
detail the nature of such event, (y) as to the increased cost or reduced amount
resulting from such event and (z) as to the additional amount demanded by such
Lender and a reasonably detailed
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explanation of the calculation thereof. Such a certificate as to any
additional amounts payable pursuant to this subsection submitted by such
Lender, through the Agent, to the Borrower shall be conclusive and binding on
the parties hereto in the absence of manifest error.
3.11 TAXES.
(a) Except as provided below in this subsection, all
payments made by the Borrower under this Credit Agreement and any
Notes shall be made free and clear of, and without deduction 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 court, or governmental body, agency or other official,
excluding taxes measured by or imposed upon the overall net income of
any Lender or its applicable lending office, or any branch or
affiliate thereof, and all franchise taxes, branch taxes, taxes on
doing business or taxes on the overall capital or net worth of any
Lender or its applicable lending office, or any branch or affiliate
thereof, in each case imposed in lieu of net income taxes, imposed:
(i) by the jurisdiction under the laws of which such Lender,
applicable lending office, branch or affiliate is organized or is
located, or in which its principal executive office is located, or any
nation within which such jurisdiction is located or any political
subdivision thereof; or (ii) by reason of any connection between the
jurisdiction imposing such tax and such Lender, applicable lending
office, branch or affiliate other than a connection arising solely
from such Lender having executed, delivered or performed its
obligations, or received payment under or enforced, this Credit
Agreement or any Notes. If any such non-excluded taxes, levies,
imposts, duties, charges, fees, deductions or withholdings
("Non-Excluded Taxes") are required to be withheld from any amounts
payable to the Agent or any Lender hereunder or under any Notes, (A)
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 Non-Excluded Taxes) interest or any such other amounts
payable hereunder at the rates or in the amounts specified in this
Credit Agreement and any Notes, provided, however, that, to the extent
the Borrower is required to withhold any Non-Excluded Taxes as a
result the failure of any Lender that is not organized under the laws
of the United States of America or a state thereof to comply with the
requirements of paragraph (b) of this subsection (a "Non-Filing
Lender"), the Borrower shall be entitled to deduct and withhold such
Non-Excluded Taxes and shall not be required to increase any such
amounts payable to such Non-Filing Lender, and (B) 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. If the Borrower fails to pay any
Non-Excluded Taxes when due to the appropriate taxing authority or
fails to remit to the Agent the required receipts or other required
documentary evidence, the Borrower shall indemnify the Agent and the
Lenders for any incremental taxes, interest or penalties that may
become payable by the Agent or any Lender as a result of any such
failure.
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(b) Each Lender that is not incorporated under the laws
of the United States of America or a state thereof shall:
(X)(i) on or before the date of any payment by the
Borrower under this Credit Agreement or Notes to such Lender,
deliver to the Borrower and the Agent (A) two (2) duly
completed copies of United States Internal Revenue Service
Form 1001 or 4224, or successor applicable form, as the case
may be, certifying that it is entitled to receive payments
under this Credit Agreement and any Notes without deduction or
withholding of any United States federal income taxes and (B)
an Internal Revenue Service Form W-8 or W-9, or successor
applicable form, as the case may be, certifying that it is
entitled to an exemption from United States backup withholding
tax;
(ii) deliver to the Borrower and the Agent two (2)
further copies of any such form or certification on or before
the date that any such form or certification expires or
becomes obsolete and after the occurrence of any event
requiring a change in the most recent form previously
delivered by it to the Borrower; and
(iii) obtain such extensions of time for filing and
complete such forms or certifications as may reasonably be
requested by the Borrower or the Agent; or
(Y) in the case of any such Lender that is not a "bank"
within the meaning of Section 881(c)(3)(A) of the Internal Revenue
Code, (i) represent to the Borrower (for the benefit of the Borrower
and the Agent) that it is not a bank within the meaning of Section
881(c)(3)(A) of the Internal Revenue Code, (ii) agree to furnish to
the Borrower on or before the date of any payment by the Borrower,
with a copy to the Agent two (2) accurate and complete original signed
copies of Internal Revenue Service Form W-8, or successor applicable
form certifying to such Lender's legal entitlement at the date of such
certificate to an exemption from U.S. withholding tax under the
provisions of Section 881(c) of the Internal Revenue Code with respect
to payments to be made under this Credit Agreement and any Notes (and
to deliver to the Borrower and the Agent two (2) further copies of
such form on or before the date it expires or becomes obsolete and
after the occurrence of any event requiring a change in the most
recently provided form and, if necessary, obtain any extensions of
time reasonably requested by the Borrower or the Agent for filing and
completing such forms), and (iii) agree, to the extent legally
entitled to do so, upon reasonable request by the Borrower, to provide
to the Borrower (for the benefit of the Borrower and the Agent) such
other forms as may be reasonably required in order to establish the
legal entitlement of such Lender to an exemption from withholding with
respect to payments under this Credit Agreement and any Notes;
unless in any such case any change in treaty, law or regulation has occurred
after the date such Person becomes a Lender hereunder which renders all such
forms inapplicable or which would prevent such Lender from duly completing and
delivering any such form with respect to it and such Lender so advises the
Borrower and the Agent. Each Person that shall become a Lender or a
participant of a Lender pursuant to Section 11.3 shall, upon the effectiveness
of the related
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transfer, be required to provide all of the forms, certifications and
statements required pursuant to this subsection, provided that in the case of a
participant of a Lender the obligations of such participant of a Lender
pursuant to this subsection (b) shall be determined as if the participant of a
Lender were a Lender except that such participant of a Lender shall furnish all
such required forms, certifications and statements to the Lender from which the
related participation shall have been purchased.
3.12 INDEMNITY.
The Borrower promises to indemnify each Lender and to hold each Lender
harmless from any loss or expense which such Lender may sustain or incur (other
than through such Lender's negligence or willful misconduct) as a consequence
of (a) default by the Borrower in making a borrowing of, conversion into or
continuation of Eurodollar Loans after the Borrower has given a notice
requesting the same in accordance with the provisions of this Credit Agreement,
(b) default by the Borrower in making any prepayment of a Eurodollar Loan after
the Borrower has given a notice thereof in accordance with the provisions of
this Credit Agreement or (c) the making of a prepayment of Eurodollar Loans on
a day which is not the last day of an Interest Period with respect thereto.
Such indemnification may include an amount equal to the excess, if any, of (i)
the amount of interest which would have accrued on the amount so prepaid, or
not so borrowed, converted or continued, for the period from the date of such
prepayment or of such failure to borrow, convert or continue to the last day of
the applicable Interest Period (or, in the case of a failure to borrow, convert
or continue, the Interest Period that would have commenced on the date of such
failure) in each case at the applicable rate of interest for such Loans
provided for herein over (ii) the amount of interest (as reasonably determined
by such Lender) which would have accrued to such Lender on such amount for the
related period (but excluding loss of the Applicable Percentage, if any,
applied to the amount so prepaid or not so borrowed, converted or continued for
the related period).
3.13 PRO RATA TREATMENT.
Except to the extent otherwise provided herein:
(a) Loans. Each Loan (other than Swingline Loans), each
payment or prepayment of principal of any Loan (other than Swingline
Loans) or reimbursement obligations arising from drawings under
Letters of Credit, each payment of interest on the Loans (other than
Swingline Loans) or reimbursement obligations arising from drawings
under Letters of Credit, each payment of Unused Fees, each payment of
the Standby Letter of Credit Fee, each payment of the Trade Letter of
Credit Fee, each reduction of the Revolving Committed Amount, and each
conversion or extension of any Loan (other than a Swingline Loan),
shall be allocated pro rata among the Lenders in accordance with their
respective Revolving Commitment Percentages, Foreign Currency
Commitment Percentages, Tranche A Term Loan Commitment Percentages or
Tranche B Term Loan Commitment Percentages, as applicable.
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(b) Advances. Unless the Agent shall have been notified
in writing by any Lender prior to a borrowing that such Lender will
not make the amount that would constitute its ratable share of such
borrowing available to the Agent, the Agent may assume that such
Lender is making such amount available to the Agent, and the Agent
may, in reliance upon such assumption, make available to the Borrower
a corresponding amount. If such amount is not made available to the
Agent by such Lender within the time period specified therefor
hereunder, such Lender shall pay to the Agent, on demand, such amount
with interest thereon (or, in the case of a Foreign Currency Loan,
interest on the daily Dollar Equivalent of such amount) at a rate
equal to the Federal Funds Rate for the period until such Lender makes
such amount immediately available to the Agent. A certificate of the
Agent submitted to any Lender with respect to any amounts owing under
this subsection shall be conclusive in the absence of manifest error.
If such Lender's ratable share of such borrowing is not made available
to the Agent by such Lender within two Business Days of the date of
the related borrowing, (i) the Agent shall notify the Borrower of the
failure of such Lender to make such amount available to the Agent and
the Agent shall also be entitled to recover such amount with interest
thereon at the rate per annum applicable to Base Rate Loans hereunder,
on demand, from the Borrower and (ii) then the Borrower may, without
waiving any rights it may have against such Lender, borrow a like
amount on an unsecured basis from any commercial bank for a period
ending on the date upon which such Lender does in fact make such
borrowing available, provided that at the time such borrowing is made
and at all times while such amount is outstanding the Borrower would
be permitted to borrow such amount pursuant to Section 2.1 of this
Credit Agreement.
3.14 SHARING OF PAYMENTS.
The Lenders agree among themselves that, in the event that any Lender
shall obtain payment in respect of any Loan, LOC Obligations or any other
obligation owing to such Lender under this Credit Agreement through the
exercise of a right of setoff, banker's lien or counterclaim, or pursuant to a
secured claim under Section 506 of Title 11 of the United States Code or other
security or interest arising from, or in lieu of, such secured claim, received
by such Lender under any applicable bankruptcy, insolvency or other similar law
or otherwise, or by any other means, in excess of its pro rata share of such
payment as provided for in this Credit Agreement, such Lender shall promptly
purchase from the other Lenders a participation in such Loans, LOC Obligations
and other obligations in such amounts, and make such other adjustments from
time to time, as shall be equitable to the end that all Lenders share such
payment in accordance with their respective ratable shares as provided for in
this Credit Agreement. The Lenders further agree among themselves that if
payment to a Lender obtained by such Lender through the exercise of a right of
setoff, banker's lien, counterclaim or other event as aforesaid shall be
rescinded or must otherwise be restored, each Lender which shall have shared
the benefit of such payment shall, by repurchase of a participation theretofore
sold, return its share of that benefit (together with its share of any accrued
interest payable with respect thereto) to each Lender whose payment shall have
been rescinded or otherwise restored. The Borrower agrees that any Lender so
purchasing such a participation may, to the fullest extent permitted by law,
exercise all rights of payment, including setoff, banker's lien or
counterclaim, with respect to such
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participation as fully as if such Lender were a holder of such Loan, LOC
Obligations or other obligation in the amount of such participation. Except as
otherwise expressly provided in this Credit Agreement, if any Lender or the
Agent shall fail to remit to the Agent or any other Lender an amount payable by
such Lender or the Agent to the Agent or such other Lender pursuant to this
Credit Agreement on the date when such amount is due, such payments shall be
made together with interest thereon for each date from the date such amount is
due until the date such amount is paid to the Agent or such other Lender at a
rate per annum equal to the Federal Funds Rate. If under any applicable
bankruptcy, insolvency or other similar law, any Lender receives a secured
claim in lieu of a setoff to which this Section 3.14 applies, such Lender
shall, to the extent practicable, exercise its rights in respect of such
secured claim in a manner consistent with the rights of the Lenders under this
Section 3.14 to share in the benefits of any recovery on such secured claim.
3.15 PAYMENTS, COMPUTATIONS, ETC.
(a) Currency of Payments. Each payment on account of an
amount due from any Credit Party hereunder or under any other Credit
Document shall be made by such Credit Party to the Agent for the pro
rata account of the Banks entitled to receive such payment as provided
herein in the currency in which such amount is denominated and in such
funds as are customary at the place and time of payment for the
settlement of international payments in such currency. Without
limiting the terms of the preceding sentence, accrued interest on any
Loans denominated in an Available Foreign Currency shall be payable in
the same Available Foreign Currency as such Loan. Upon request, the
Agent will give the Credit Parties a statement showing the computation
used in calculating such amount, which statement shall be conclusive
in the absence of manifest error. The obligation of each Credit Party
to make each payment on account of such amount in the currency in
which such amount is denominated shall not be discharged or satisfied
by any tender, or any recovery pursuant to any judgment, which is
expressed in or converted into any other currency, except to the
extent such tender or recovery shall result in the actual receipt by
the Agent of the full amount in the appropriate currency payable
hereunder. Each Credit Party agrees that its obligation to make each
payment on account of such amount in the currency in which such amount
is denominated shall be enforceable as an additional or alternative
claim for recovery in such currency of the amount (if any) by which
such actual receipt shall fall short of the full amount of such
currency payable hereunder, and shall not be affected by judgment
being obtained for such amount.
(b) Place and Manner of Payments. Except as otherwise
specifically provided herein, all payments hereunder shall be made to
the Agent in immediately available funds, without offset, deduction,
counterclaim or withholding of any kind, prior to 10:00 A.M., local
time in the place where such payment is required to be made pursuant
to this subsection (b), on the date due at: the office of the Agent at
901 Main Street, Dallas, Texas (ABA Routing No. 111000025, Account No.
129-200-088-3, Attn.: Corporate Credit Support, Reference: Genicom
Corporation) with respect to payments in Dollars; at Midland Bank PLC,
London, for the account of NationsBank, N.A. for further credit to
NationsBank of Texas, N.A., Account No. 00478549 with respect to
payments in British
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Pounds Sterling; at Societe Generale, Paris, for the account of
NationsBank, N.A. for further credit to NationsBank of Texas, N.A.,
Account No. 000101442920003 with respect to payments in French Francs;
at Commerzbank, Frankfurt, for the account of NationsBank, N.A. for
further credit to NationsBank of Texas, N.A., Account No. 400887531200
with respect to payments in Deutsche Marks; at Bank of Tokyo, Tokyo,
for the account of NationsBank, N.A. for further credit to NationsBank
of Texas, N.A., Account No. 653-0433101, with respect to payments in
Japanese Yen; at Credito Italiano, Milan, for the account of
NationsBank, N.A. for further credit to NationsBank of Texas, N.A.,
Account No. 84184-00, with respect to payments in Italian Lira; at
Royal Bank of Canada, Toronto, for the account of NationsBank, N.A.
for further credit to NationsBank of Texas, N.A., Account No.
237-332-2 with respect to payments in Canadian Dollars; or at such
other place as may be designated by the Agent to the Borrower in
writing. Any payments received after such time shall be deemed
received on the next succeeding Business Day. The Agent may, but
shall not be obligated to, charge any account of the Borrower at the
Agent for the payment when due of all amounts payable by the Borrower
hereunder. The Borrower shall, at the time it makes any payment under
this Credit Agreement, specify to the Agent the Loans, LOC
Obligations, Fees, interest or other amounts payable by the Borrower
hereunder to which such payment is to be applied (and in the event
that it fails so to specify, or if such application would be
inconsistent with the terms hereof, the Agent shall distribute such
payment to the Lenders in such manner as the Agent may determine to be
appropriate in respect of obligations owing by the Borrower hereunder,
subject to the terms of Section 3.13(a)). The Agent shall promptly
remit in same day funds to each Lender such Lender's share, if any, of
payments received by the Agent for the account of such Lender.
Whenever any payment hereunder shall be stated to be due on a day
which is not a Business Day, the due date thereof shall be extended to
the next succeeding Business Day (subject to accrual of interest and
Fees for the period of such extension), except that in the case of
Eurodollar Loans, if the extension would cause the payment to be made
in the next following calendar month, then such payment shall instead
be made on the next preceding Business Day. Except as expressly
provided otherwise herein, all computations of interest and fees shall
be made on the basis of actual number of days elapsed over a year of
360 days, except with respect to computation of interest on Base Rate
Loans which (unless the Base Rate is determined by reference to the
Federal Funds Rate) shall be calculated based on a year of 365 or 366
days, as appropriate. Interest shall accrue from and include the date
of borrowing, but exclude the date of payment.
(c) Allocation of Payments After Event of Default.
Notwithstanding any other provisions of this Credit Agreement, to the
contrary, after the occurrence and during the continuance of an Event
of Default, all amounts collected or received by the Agent or any
Lender on account of the Borrower's Obligations or any other amounts
outstanding under any of the Credit Documents or in respect of the
Collateral shall be paid over or delivered as follows:
FIRST, to the payment of all reasonable out-of-pocket costs
and expenses (including without limitation reasonable attorneys' fees)
of the Agent in connection with
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enforcing the rights of the Lenders under the Credit Documents and any
protective advances made by the Agent with respect to the Collateral
under or pursuant to the terms of the Collateral Documents;
SECOND, to payment of any fees owed to the Agent or the
Issuing Lender;
THIRD, to the payment of all reasonable out-of-pocket costs
and expenses, (including without limitation, reasonable attorneys'
fees) of each of the Lenders in connection with enforcing its rights
under the Credit Documents or otherwise with respect to the Borrower's
Obligations owing to such Lender;
FOURTH, to the payment of all of the Borrower's Obligations
consisting of accrued fees and interest;
FIFTH, to the payment of the outstanding principal amount of
the Borrower's Obligations (including the payment or cash
collateralization of the outstanding LOC Obligations);
SIXTH, to all other Borrower's Obligations and other
obligations which shall have become due and payable under the Credit
Documents or otherwise and not repaid pursuant to clauses "FIRST"
through "FIFTH" above; and
SEVENTH, to the payment of the surplus, if any, to whoever may
be lawfully entitled to receive such surplus.
In carrying out the foregoing, (i) amounts received shall be applied in the
numerical order provided until exhausted prior to application to the next
succeeding category; (ii) each of the Lenders shall receive an amount equal to
its pro rata share (based on the proportion that the then outstanding Loans and
LOC Obligations held by such Lender bears to the aggregate then outstanding
Loans and LOC Obligations) of amounts available to be applied pursuant to
clauses "THIRD", "FOURTH", "FIFTH" and "SIXTH" above; and (iii) to the extent
that any amounts available for distribution pursuant to clause "FIFTH" above
are attributable to the issued but undrawn amount of outstanding Letters of
Credit, such amounts shall be held by the Agent in a cash collateral account
and applied (A) first, to reimburse the Issuing Lender from time to time for
any drawings under such Letters of Credit and (B) then, following the
expiration of all Letters of Credit, to all other obligations of the types
described in clauses "FIFTH" and "SIXTH" above in the manner provided in this
Section 3.15(c).
3.16 EVIDENCE OF DEBT.
(a) Each Lender shall maintain an account or accounts
evidencing each Loan made by such Lender to the Borrower from time to
time, including the amounts of principal and interest payable and paid
to such Lender from time to time under this Credit Agreement. Each
Lender will make reasonable efforts to maintain the accuracy of its
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account or accounts and to promptly update its account or accounts
from time to time, as necessary.
(b) The Agent shall maintain the Register pursuant to
Section 11.3(c) hereof, and a subaccount for each Lender, in which
Register and subaccounts (taken together) shall be recorded (i) the
amount, type and Interest Period of each such Loan hereunder, (ii) the
amount of any principal or interest due and payable or to become due
and payable to each Lender hereunder and (iii) the amount of any sum
received by the Agent hereunder from or for the account of the
Borrower and each Lender's share thereof. The Agent will make
reasonable efforts to maintain the accuracy of the subaccounts
referred to in the preceding sentence and to promptly update such
subaccounts from time to time, as necessary.
(c) The entries made in the accounts, Register and
subaccounts maintained pursuant to subsections (a) and (b) of this
Section 3.16 shall, in the absence of manifest error, be conclusive
evidence of the existence and amounts of the obligations of the
Borrower therein recorded; provided, however, that the failure of any
Lender or the Agent to maintain any such account, such Register or
such subaccount, as applicable, or any error therein, shall not in any
manner affect the obligation of the Borrower to repay the Loans made
by such Lender in accordance with the terms hereof.
SECTION 4
GUARANTY
4.1 THE GUARANTEE.
Each of the Guarantors hereby jointly and severally guarantees to each
Lender and the Agent as hereinafter provided the prompt payment of the
Borrower's Obligations in full when due (whether at stated maturity, as a
mandatory prepayment, by acceleration, a mandatory cash collateralization or
otherwise) strictly in accordance with the terms thereof. The Guarantors
hereby further agree that if any of the Borrower's Obligations are not paid in
full when due (whether at stated maturity, as a mandatory prepayment, by
acceleration, as mandatory cash collateralization or otherwise), the Guarantors
will, jointly and severally, promptly pay the same, without any demand or
notice whatsoever, and that in the case of any extension of time of payment or
renewal of any of the Borrower's Obligations, the same will be promptly paid in
full when due (whether at extended maturity, as a mandatory prepayment, by
acceleration or otherwise) in accordance with the terms of such extension or
renewal.
Notwithstanding any provision to the contrary contained herein or in
any other of the Credit Documents, to the extent the obligations of a Guarantor
shall be adjudicated to be invalid or unenforceable for any reason (including,
without limitation, because of any applicable state or federal law relating to
fraudulent conveyances or transfers) then the obligations of each Guarantor
hereunder shall be limited to the maximum amount that is permissible under
applicable law (whether federal or state and including, without limitation, the
Bankruptcy Code).
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4.2 OBLIGATIONS UNCONDITIONAL.
The obligations of the Guarantors under Section 4.1 hereof are joint
and several, absolute and unconditional, irrespective of the value,
genuineness, validity, regularity or enforceability of any of the Credit
Documents, or any other agreement or instrument referred to therein, or any
substitution, release or exchange of any other guarantee of or security for any
of the Borrower's Obligations, and, to the fullest extent permitted by
applicable law, irrespective of any other circumstance whatsoever which might
otherwise constitute a legal or equitable discharge or defense of a surety or
guarantor, it being the intent of this Section 4.2 that the obligations of the
Guarantors hereunder shall be absolute and unconditional under any and all
circumstances. Each Guarantor agrees that such Guarantor shall have no right
of subrogation, indemnity, reimbursement or contribution against the Borrower
or any other Guarantor of the Borrower's Obligations for amounts paid under
this Guaranty until such time as the Lenders have been paid in full, all
Commitments under the Credit Agreement have been terminated and no Person or
Governmental Authority shall have any right to request any return or
reimbursement of funds from the Lenders in connection with monies received
under the Credit Documents. Without limiting the generality of the foregoing,
it is agreed that, to the fullest extent permitted by law, the occurrence of
any one or more of the following shall not alter or impair the liability of any
Guarantor hereunder which shall remain absolute and unconditional as described
above:
(i) at any time or from time to time, without
notice to any Guarantor, the time for any performance of or
compliance with any of the Borrower's Obligations shall be
extended, or such performance or compliance shall be waived;
(ii) any of the acts mentioned in any of the
provisions of any of the Credit Documents or any other
agreement or instrument referred to therein shall be done or
omitted;
(iii) the maturity of any of the Borrower's
Obligations shall be accelerated, or any of the Borrower's
Obligations shall be modified, supplemented or amended in any
respect, or any right under any of the Credit Documents or any
other agreement or instrument referred to therein shall be
waived or any other guarantee of any of the Borrower's
Obligations or any security therefor shall be released or
exchanged in whole or in part or otherwise dealt with;
(iv) any Lien granted to, or in favor of, the
Agent or any Lender or Lenders as security for any of the
Borrower's Obligations shall fail to attach or be perfected;
or
(v) any of the Borrower's Obligations shall be
determined to be void or voidable (including, without
limitation, for the benefit of any creditor of any Guarantor)
or shall be subordinated to the claims of any Person
(including, without limitation, any creditor of any
Guarantor).
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With respect to its obligations hereunder, each Guarantor hereby expressly
waives diligence, presentment, demand of payment, protest and all notices
whatsoever, and any requirement that the Agent or any Lender exhaust any right,
power or remedy or proceed against any Person under any of the Credit Documents
or any other agreement or instrument referred to therein, or against any other
Person under any other guarantee of, or security for, any of the Borrower's
Obligations.
4.3 REINSTATEMENT.
The obligations of the Guarantors under this Section 4 shall be
automatically reinstated if and to the extent that for any reason any payment
by or on behalf of any Person in respect of the Borrower's Obligations is
rescinded or must be otherwise restored by any holder of any of the Borrower's
Obligations, whether as a result of any proceedings in bankruptcy or
reorganization or otherwise, and each Guarantor agrees that it will indemnify
the Agent and each Lender on demand for all reasonable costs and expenses
(including, without limitation, fees and expenses of counsel) incurred by the
Agent or such Lender in connection with such rescission or restoration,
including any such costs and expenses incurred in defending against any claim
alleging that such payment constituted a preference, fraudulent transfer or
similar payment under any bankruptcy, insolvency or similar law.
4.4 CERTAIN ADDITIONAL WAIVERS.
Without limiting the generality of the provisions of this Section 4,
each Guarantor hereby agrees that such Guarantor shall have no right of
recourse to security for the Borrower's Obligations.
4.5 REMEDIES.
The Guarantors agree that, to the fullest extent permitted by law, as
between the Guarantors, on the one hand, and the Agent and the Lenders, on the
other hand, the Borrower's Obligations may be declared to be forthwith due and
payable as provided in Section 9.2 hereof (and shall be deemed to have become
automatically due and payable in the circumstances provided in said Section
9.2) for purposes of Section 4.1 hereof notwithstanding any stay, injunction or
other prohibition preventing such declaration (or preventing the Borrower's
Obligations from becoming automatically due and payable) as against any other
Person and that, in the event of such declaration (or the Borrower's
Obligations being deemed to have become automatically due and payable), the
Borrower's Obligations (whether or not due and payable by any other Person)
shall forthwith become due and payable by the Guarantors for purposes of said
Section 4.1.
4.6 RIGHTS OF CONTRIBUTION.
The Guarantors hereby agree, as among themselves, that if any
Guarantor shall become an Excess Funding Guarantor (as defined below), each
other Guarantor shall, on demand of such Excess Funding Guarantor (but subject
to the succeeding provisions of this Section 4.6), pay to such Excess Funding
Guarantor an amount equal to such Guarantor's Pro Rata Share (as defined
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below and determined, for this purpose, without reference to the properties,
assets, liabilities and debts of such Excess Funding Guarantor) of such Excess
Payment (as defined below). The payment obligation of any Guarantor to any
Excess Funding Guarantor under this Section 4.6 shall be subordinate and
subject in right of payment to the prior payment in full of the obligations of
such Guarantor under the other provisions of this Section 4, and such Excess
Funding Guarantor shall not exercise any right or remedy with respect to such
excess until payment and satisfaction in full of all of such obligations. For
purposes hereof, (i) "Excess Funding Guarantor" shall mean, in respect of any
obligations arising under the other provisions of this Section 4 (hereafter,
the "Guaranteed Obligations"), a Guarantor that has paid an amount in excess of
its Pro Rata Share of the Guaranteed Obligations; (ii) "Excess Payment" shall
mean, in respect of any Guaranteed Obligations, the amount paid by an Excess
Funding Guarantor in excess of its Pro Rata Share of such Guaranteed
Obligations; and (iii) "Pro Rata Share", for the purposes of this Section 4.6,
shall mean, for any Guarantor, the ratio (expressed as a percentage) of (a) the
amount by which the aggregate present fair saleable value of all of its assets
and properties exceeds the amount of all debts and liabilities of such
Guarantor (including contingent, subordinated, unmatured, and unliquidated
liabilities, but excluding the obligations of such Guarantor hereunder) to (b)
the amount by which the aggregate present fair saleable value of all assets and
other properties of the Borrower and all of the Guarantors exceeds the amount
of all of the debts and liabilities (including contingent, subordinated,
unmatured, and unliquidated liabilities, but excluding the obligations of the
Borrower and the Guarantors hereunder) of the Borrower and all of the
Guarantors, all as of the Closing Date (if any Guarantor becomes a party hereto
subsequent to the Closing Date, then for the purposes of this Section 4.6 such
subsequent Guarantor shall be deemed to have been a Guarantor as of the Closing
Date and the information pertaining to, and only pertaining to, such Guarantor
as of the date such Guarantor became a Guarantor shall be deemed true as of the
Closing Date).
4.7 CONTINUING GUARANTEE.
The guarantee in this Section 4 is a continuing guarantee, and shall
apply to all Borrower's Obligations whenever arising.
SECTION 5
CONDITIONS
5.1 CLOSING CONDITIONS.
The obligation of the Lenders (including the Swingline Lender) to make
the initial Loans or of the Issuing Lender to issue the initial Letter of
Credit on the Closing Date, whichever shall occur first, shall be subject to
satisfaction of the following conditions on or before the Closing Date:
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(a) The Agent shall have received, in form and substance
satisfactory to the Agent, duly executed copies of: (i) this Credit
Agreement; (ii) the Notes; (iii) the Collateral Documents and (iv) all
other Credit Documents,
(b) The Agent shall have received, in form and substance
satisfactory to the Agent:
(i) duly executed UCC financing statements for
each appropriate jurisdiction as is necessary, in the Agent's
sole discretion, to perfect the Agent's security interest in
the Collateral;
(ii) all stock certificates evidencing the stock
pledged to the Agent pursuant to the Pledge Agreement,
together with duly executed in blank undated stock powers
attached thereto;
(iii) such patent/trademark/copyright filings as
requested by the Agent in order to perfect the Agent's
security interest in the Collateral;and
(iv) such estoppel letters, consents and waivers
as may be required by the Agent from the landlords of each
leased location of Collateral set forth in Schedule 2 to the
Security Agreement;
(c) The Agent shall have received all documents it may
reasonably request relating to the existence and good standing of each
of the Credit Parties, the corporate or other necessary authority for
and the validity of the Credit Documents, and any other matters
relevant thereto, all in form and substance reasonably satisfactory to
the Agent;
(d) The Agent shall have received a legal opinion of
McGuire, Woods, Battle & Boothe, counsel for the Credit Parties, dated
as of the Closing Date and substantially in the form of Schedule
5.1(d);
(e) The Agent shall have received a legal opinion of
Berwin Leighton, special U.K. counsel for the Lenders, dated as of the
Closing Date and substantially in the form of Schedule 5.1(e);
(f) The Agent shall have received copies of insurance
policies or certificates of insurance of the Credit Parties evidencing
liability and casualty insurance meeting the requirements of the
Credit Documents;
(g) No material adverse change shall have occurred since
December 29, 1996 in the condition (financial or otherwise), business
or management of the Borrower or of the Borrower and its Subsidiaries
taken as a whole;
(h) There shall not have occurred any material disruption
of, or a material adverse change in, financial, banking or capital
market conditions;
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(i) There shall not exist any pending or threatened
action, suit, investigation or proceeding against the Borrower or its
Subsidiaries that could have a Material Adverse Effect;
(j) The Agent shall have received satisfactory evidence
that the Existing Credit Agreement and the TI Deferred Financing Note,
together with all interest, prepayment premiums and other amounts due
and payable, have been paid in full and the related commitments
terminated;
(k) The Agent shall have received a certificate executed
by the chief financial officer or treasurer of the Borrower as of the
Closing Date stating that immediately after giving effect to the
transactions contemplated in this Credit Agreement and the other
Credit Documents and the initial extensions of credit hereunder on the
Closing Date, (i) each of the Credit Parties is Solvent, (ii) the
Borrower is in compliance with all financial covenants contained in
Section 7.11 hereof, (iii) no Default or Event of Default exists and
(iv) the representations and warranties set forth in Section 6 are
true and correct in all material respects;
(l) The Agent shall have received such other documents,
agreements or information which may be reasonably requested by the
Agent; and
(m) The Agent shall have received, for its own account
and for the accounts of the Lenders, all fees and expenses required by
this Credit Agreement or any other Credit Document to be paid on or
before the Closing Date.
5.2 CONDITIONS TO ALL EXTENSIONS OF CREDIT.
The obligations of each Lender (including the Swingline Lender) to
make, convert or extend any Loan and of the Issuing Lender to issue or extend
Letters of Credit (including the initial Loans and the initial Letter of
Credit) are subject to satisfaction of the following conditions in addition to
satisfaction on the Closing Date of the conditions set forth in Section 5.1 and
satisfaction on the Closing Date of the conditions set forth in Section 5.2:
(a) The Borrower shall have delivered (A) in the case of
any Revolving Loan, any Foreign Currency Loan, the Tranche A Term Loan
or the Tranche B Term Loan, an appropriate Notice of Borrowing or
Notice of Extension/Conversion, (B) in the case of any Swingline Loan,
the Swingline Lender shall have received an appropriate notice of
borrowing in accordance with the provisions of Section 2.3(b)(i) or
(C) in the case of any Letter of Credit, the Issuing Lender shall have
received an appropriate request for issuance in accordance with the
provisions of Section 2.2(b);
(b) The representations and warranties set forth in
Section 6 shall be, subject to the limitations set forth therein, true
and correct in all material respects as of such date (except for those
which expressly relate to an earlier date);
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(c) There shall not have been commenced against the
Borrower an involuntary case under any applicable bankruptcy,
insolvency or other similar law now or hereafter in effect, or any
case, proceeding or other action for the appointment of a receiver,
liquidator, assignee, custodian, trustee, sequestrator (or similar
official) of such Person or for any substantial part of its Property
or for the winding up or liquidation of its affairs, and such
involuntary case or other case, proceeding or other action shall
remain undismissed, undischarged or unbonded;
(d) No Default or Event of Default shall exist and be
continuing either prior to or after giving effect thereto;
(e) No material adverse change shall have occurred since
December 29, 1996 in the condition (financial or otherwise), business
or management of the Borrower or of the Borrower and its Subsidiaries
taken as a whole; and
(f) Immediately after giving effect to the making of such
Loan (and the application of the proceeds thereof) or to the issuance
of such Letter of Credit, as the case may be, (A) the sum of the
aggregate principal amount of outstanding Revolving Loans plus the
Dollar Amount (as determined as of the most recent Determination Date)
of the aggregate principal amount of outstanding Foreign Currency
Loans plus the aggregate principal amount of outstanding Swingline
Loans plus LOC Obligations outstanding shall not exceed the lesser of
(1) the Revolving Committed Amount and (2) the Borrowing Base, and (B)
the LOC Obligations shall not exceed the LOC Committed Amount.
The delivery of each Notice of Borrowing, each Notice of Extension/Conversion
and each request for a Letter of Credit pursuant to Section 2.2(b) shall
constitute a representation and warranty by the Borrower of the correctness of
the matters specified in subsections (b), (c), (d), (e) and (f) above.
SECTION 6
REPRESENTATIONS AND WARRANTIES
The Credit Parties hereby represent to the Agent and each Lender that:
6.1 FINANCIAL CONDITION.
(a) The audited consolidated balance sheet of the
Borrower and its consolidated Subsidiaries as of December 29, 1996 and
the audited consolidated statements of earnings and statements of cash
flows for the year ended December 29, 1996 have heretofore been
furnished to each Lender. Such financial statements (including the
notes thereto) (i) have been audited by Coopers & Lybrand, LLP, (ii)
have been prepared in accordance with GAAP consistently applied
throughout the periods covered thereby and (iii) present fairly (on
the basis disclosed in the footnotes to such financial
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statements) the consolidated financial condition, results of
operations and cash flows of the Borrower and its consolidated
Subsidiaries as of such date and for such periods. The unaudited
interim consolidated and consolidating balance sheets of the Borrower
and its consolidated Subsidiaries as at the end of, and the related
unaudited interim statements of earnings and of cash flows for each
fiscal quarterly period ended after December 29, 1996 and prior to the
Closing Date have heretofore been furnished to each Lender. Such
interim financial statements for each such quarterly period, (i) have
been prepared in accordance with GAAP consistently applied throughout
the periods covered thereby and (ii) present fairly (on the basis
disclosed in the footnotes to such financial statements) the
consolidated and consolidating (as applicable) financial condition,
results of operations and cash flows of the Borrower and its
consolidated Subsidiaries as of such date and for such periods.
Except for the acquisition of certain assets of the Printing Systems
Business of Digital Equipment Corporation, during the period from
December 29, 1996 to and including the Closing Date, there has been no
sale, transfer or other disposition by the Borrower or any of its
Subsidiaries of any material part of the business or property of the
Borrower and its consolidated Subsidiaries, taken as a whole, and no
purchase or other acquisition by any of them of any business or
property (including any capital stock of any other Person) material in
relation to the consolidated financial condition of the Borrower and
its consolidated Subsidiaries taken as a whole, in each case which is
not reflected in the foregoing financial statements or in the notes
thereto.
(b) The pro forma balance sheets and income statements of
the Borrower and its Subsidiaries for fiscal years 1997, 1998, 1999,
2000, 2001, 2002, 2003 and 2004 copies of which have heretofore been
furnished to each Lender, are based upon reasonable assumptions made
known to the Lenders and upon information not known to be incorrect or
misleading in any material respect.
6.2 NO CHANGE.
Since December 29,1996, (a) there has been no development or event
relating to or affecting the Borrower or any of its Subsidiaries which has had
or would be reasonably expected to have a Material Adverse Effect and (b)
except as permitted under this Credit Agreement, no dividends or other
distributions have been declared, paid or made upon the capital stock or other
equity interest in the Borrower or any of its Subsidiaries nor, except as
otherwise permitted under this Credit Agreement, has any of the capital stock
or other equity interest in the Borrower or any of its Subsidiaries been
redeemed, retired, purchased or otherwise acquired for value by such Person.
6.3 ORGANIZATION; EXISTENCE; COMPLIANCE WITH LAW.
Each of the Borrower and its Subsidiaries (a) is a corporation duly
organized, validly existing and is in good standing under the laws of the
jurisdiction of its incorporation or organization, (b) has the corporate or
other necessary power and authority, and the legal right, to own and operate
its property, to lease the property it operates as lessee and to conduct the
business in which it is currently engaged, except to the extent that the
failure to have such legal
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right would not be reasonably expected to have a Material Adverse Effect, (c)
is duly qualified as a foreign entity and in good standing under the laws of
each jurisdiction where its ownership, lease or operation of property or the
conduct of its business requires such qualification, other than in such
jurisdictions where the failure to be so qualified and in good standing would
not be reasonably expected to have a Material Adverse Effect, and (d) is in
compliance with all material Requirements of Law, except to the extent that the
failure to comply therewith would not, in the aggregate, be reasonably expected
to have a Material Adverse Effect.
6.4 POWER; AUTHORIZATION; ENFORCEABLE OBLIGATIONS.
Each of the Credit Parties and Genicom Ltd. has the corporate or other
necessary power and authority, and the legal right, to make, deliver and
perform the Credit Documents to which it is a party, and in the case of the
Borrower, to borrow hereunder, and has taken all necessary corporate action to
authorize the borrowings on the terms and conditions of this Credit Agreement
and to authorize the execution, delivery and performance of the Credit
Documents to which it is a party. No consent or authorization of, filing with,
notice to or other similar act by or in respect of, any Governmental Authority
or any other Person is required to be obtained or made by or on behalf of any
Credit Party or Genicom Ltd. in connection with the borrowings hereunder or
with the execution, delivery, performance, validity or enforceability of the
Credit Documents to which such Person is a party, except for (i) consents,
authorizations, notices and filings described in Schedule 6.4, all of which
have been obtained or made or have the status described in such Schedule 6.4
and (ii) filings to perfect the Liens created by the Collateral Documents.
This Credit Agreement has been, and each other Credit Document will be, duly
executed and delivered on behalf of each of the Credit Parties and Genicom Ltd.
that is a party thereto. This Credit Agreement constitutes, and each other
Credit Document to which any Credit Party or Genicom Ltd. is a party when
executed and delivered will constitute, a legal, valid and binding obligation
of such Person enforceable against such Person in accordance with its terms,
except as enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting the enforcement of
creditors' rights generally and by general equitable principles (whether
enforcement is sought by proceedings in equity or at law).
6.5 NO LEGAL BAR.
The execution, delivery and performance of the Credit Documents by
each of the Credit Parties and Genicom Ltd. that is a Party thereto, the
borrowings hereunder and the use of the proceeds thereof (a) will not violate
any Requirement of Law or contractual obligation of the Borrower or any of its
Subsidiaries in any respect that would reasonably be expected to have a
Material Adverse Effect, (b) will not result in, or require, the creation or
imposition of any Lien (other than the Liens created by the Collateral
Documents) on any of the properties or revenues of the Borrower or any of its
Subsidiaries pursuant to any such Requirement of Law or contractual obligation,
and (c) will not violate or conflict with any provision of any Credit Party's
or Genicom Ltd.'s articles of incorporation or by-laws (or other comparable
organic documents).
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6.6 NO MATERIAL LITIGATION.
Except as disclosed and described in Schedule 6.6 attached hereto, no
litigation, investigation or proceeding of or before any arbitrator or
Governmental Authority is pending or, to the best knowledge of the Credit
Parties, threatened by or against the Borrower or any of its Subsidiaries or
against any of their respective properties or revenues which (a) relates to any
of the Credit Documents or any of the transactions contemplated hereby or
thereby or (b) would be reasonably expected to have a Material Adverse Effect.
6.7 NO DEFAULT.
Neither the Borrower nor any of its Subsidiaries is in default under
or with respect to any of its contractual obligations in any respect which
would be reasonably expected to have a Material Adverse Effect. No Default or
Event of Default has occurred and is continuing.
6.8 OWNERSHIP OF PROPERTY; LIENS.
Each of the Borrower and its Subsidiaries has good record and
marketable title in fee simple to, or a valid leasehold interest in, all its
material real property, and good title to, or a valid leasehold interest in,
all its other material property, and none of such property is subject to any
Lien, except for Permitted Liens.
6.9 INTELLECTUAL PROPERTY.
Each of the Borrower and its Subsidiaries owns, or has the legal right
to use, all United States trademarks, tradenames, copyrights, technology,
know-how and processes necessary for each of them to conduct its business as
currently conducted (the "Intellectual Property") except for those the failure
to own or have such legal right to use would not be reasonably expected to have
a Material Adverse Effect. No claim has been asserted and is pending by any
Person challenging or questioning the use of any such Intellectual Property or
the validity or effectiveness of any such Intellectual Property, nor does any
Credit Party know of any such claim, and the use of such Intellectual Property
by the Borrower or any of its Subsidiaries does not infringe on the rights of
any Person, except for such claims and infringements that in the aggregate,
would not be reasonably expected to have a Material Adverse Effect.
6.10 NO BURDENSOME RESTRICTIONS.
No Requirement of Law or contractual obligation of the Borrower or any
of its Subsidiaries would be reasonably expected to have a Material Adverse
Effect.
6.11 TAXES.
Each of the Borrower and its Subsidiaries has filed or caused to be
filed all United States federal income tax returns and all other material tax
returns which, to the best knowledge of the Credit Parties, are required to be
filed and has paid (a) all taxes shown to be due and payable on
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said returns or (b) all taxes shown to be due and payable on any assessments of
which it has received notice made against it or any of its property and all
other taxes, fees or other charges imposed on it or any of its property by any
Governmental Authority (other than any (i) taxes, fees or other charges with
respect to which the failure to pay, in the aggregate, would not have a
Material Adverse Effect or (ii) taxes, fees or other charges the amount or
validity of which are currently being contested and with respect to which
reserves in conformity with GAAP have been provided on the books of such
Person), and no tax Lien has been filed, and, to the best knowledge of the
Credit Parties, no claim is being asserted, with respect to any such tax, fee
or other charge.
6.12 ERISA.
Except as would not result in a Material Adverse Effect disclosed and
described in Schedule 6.12 attached hereto:
(a) During the five-year period prior to the date on
which this representation is made or deemed made: (i) no Termination
Event has occurred, and, to the best knowledge of the Credit Parties,
no event or condition has occurred or exists as a result of which any
Termination Event could reasonably be expected to occur, with respect
to any Plan; (ii) no "accumulated funding deficiency," as such term is
defined in Section 302 of ERISA and Section 412 of the Code, whether
or not waived, has occurred with respect to any Plan; (iii) each Plan
has been maintained, operated, and funded in compliance with its own
terms and in material compliance with the provisions of ERISA, the
Code, and any other applicable federal or state laws; and (iv) no lien
in favor of the PBGC or a Plan has arisen or is reasonably likely to
arise on account of any Plan.
(b) The actuarial present value of all "benefit
liabilities" under each Single Employer Plan (determined within the
meaning of Section 401(a)(2) of the Code, utilizing the actuarial
assumptions used to fund such Plans), whether or not vested, did not,
as of the last annual valuation date prior to the date on which this
representation is made or deemed made, exceed by more than $2,300,000
the current value of the assets of such Plan allocable to such accrued
liabilities.
(c) Neither the Borrower, any of the Subsidiaries of the
Borrower nor any ERISA Affiliate has incurred, or, to the best
knowledge of the Credit Parties, could be reasonably expected to
incur, any withdrawal liability under ERISA to any Multiemployer Plan
or Multiple Employer Plan. Neither the Borrower, any of the
Subsidiaries of the Borrower nor any ERISA Affiliate would become
subject to any withdrawal liability under ERISA if the Borrower, any
of the Subsidiaries of the Borrower or any ERISA Affiliate were to
withdraw completely from all Multiemployer Plans and Multiple Employer
Plans as of the valuation date most closely preceding the date on
which this representation is made or deemed made. Neither the
Borrower, any of the Subsidiaries of the Borrower nor any ERISA
Affiliate has received any notification that any Multiemployer Plan is
in reorganization (within the meaning of Section 4241 of ERISA), is
insolvent (within the meaning of Section 4245 of ERISA), or has been
terminated (within the meaning of Title
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IV of ERISA), and no Multiemployer Plan is, to the best knowledge of
the Credit Parties, reasonably expected to be in reorganization,
insolvent, or terminated.
(d) No prohibited transaction (within the meaning of
Section 406 of ERISA or Section 4975 of the Code) or breach of
fiduciary responsibility has occurred with respect to a Plan which has
subjected or may subject the Borrower, any of the Subsidiaries of the
Borrower or any ERISA Affiliate to any liability under Sections 406,
409, 502(i), or 502(l) of ERISA or Section 4975 of the Code, or under
any agreement or other instrument pursuant to which the Borrower, any
of the Subsidiaries of the Borrower or any ERISA Affiliate has agreed
or is required to indemnify any person against any such liability.
(e) Each Plan which is a welfare plan (as defined in
Section 3(1) of ERISA) to which Sections 601-609 of ERISA and Section
4980B of the Code apply has been administered in compliance in all
material respects with such sections.
(f) Neither the execution and delivery of this Agreement
nor the consummation of the financing transactions contemplated
thereunder will involve any transaction which is subject to the
prohibitions of Section 406 of ERISA or in connection with which a tax
could be imposed pursuant to Section 4975 of the Code. The
representation by the Credit Parties in the preceding sentence is made
in reliance upon and subject to the accuracy of the Lenders'
representation in Section 11.16 with respect to their source of funds
and is subject, in the event that the source of the funds used by the
Lenders in connection with this transaction is an insurance company's
general asset account, to the continued validity of Department of
Labor Interpretative Bulletin 75-2, 29 C.F.R. ' 2509.75-2(b) (November
13, 1986) or the issuance of any other similar relief or prohibited
transaction exemption, to the effect that assets in an insurance
company's general asset account do not constitute assets of an
"employee benefit plan" within the meaning of Section 3(3) of ERISA or
a "plan" within the meaning of Section 4975(e)(1) of the Code.
6.13 GOVERNMENTAL REGULATIONS, ETC.
(a) No part of the proceeds of the Loans will be used,
directly or indirectly, for the purpose of purchasing or carrying any
"margin stock" within the meaning of Regulation G or Regulation U, or
for the purpose of purchasing or carrying or trading in any
securities. If requested by any Lender or the Agent, the Borrower
will furnish to the Agent and each Lender a statement to the foregoing
effect in conformity with the requirements of FR Form U-1 referred to
in said Regulation U. No indebtedness being reduced or retired out of
the proceeds of the Loans was or will be incurred for the purpose of
purchasing or carrying any margin stock within the meaning of
Regulation U or any "margin security" within the meaning of Regulation
T. "Margin stock" within the meanings of Regulation U does not
constitute more than 25% of the value of the consolidated assets of
the Borrower and its Subsidiaries. None of the transactions
contemplated by this Credit Agreement (including, without limitation,
the direct or indirect
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use of the proceeds of the Loans) will violate or result in a
violation of the Securities Act of 1933, as amended, or the Securities
Exchange Act of 1934, as amended, or regulations issued pursuant
thereto, or Regulation G, T, U or X.
(b) Neither the Borrower nor any of its Subsidiaries is
subject to regulation under the Public Utility Holding Company Act of
1935, the Federal Power Act or the Investment Company Act of 1940,
each as amended. In addition, neither the Borrower nor any of its
Subsidiaries is (i) an "investment company" registered or required to
be registered under the Investment Company Act of 1940, as amended,
and is not controlled by such a company, or (ii) a "holding company",
or a "subsidiary company" of a "holding company", or an "affiliate" of
a "holding company" or of a "subsidiary" of a "holding company",
within the meaning of the Public Utility Holding Company Act of 1935,
as amended.
(c) No director, executive officer or principal
shareholder of the Borrower or any of its Subsidiaries is a director,
executive officer or principal shareholder of any Lender. For the
purposes hereof the terms "director", "executive officer" and
"principal shareholder" (when used with reference to any Lender) have
the respective meanings assigned thereto in Regulation O issued by the
Board of Governors of the Federal Reserve System.
(d) Each of the Borrower and its Subsidiaries has
obtained all material licenses, permits, franchises or other
governmental authorizations necessary to the ownership of its
respective Property and to the conduct of its business.
(e) Neither the Borrower nor any of its Subsidiaries is
in violation of any applicable statute, regulation or ordinance of the
United States of America, or of any state, city, town, municipality,
county or any other jurisdiction, or of any agency thereof (including
without limitation, environmental laws and regulations), which
violation could reasonably be expected to have a Material Adverse
Effect.
(f) Each of the Borrower and its Subsidiaries is current
with all material reports and documents, if any, required to be filed
with any state or federal securities commission or similar agency and
is in full compliance in all material respects with all applicable
rules and regulations of such commissions.
6.14 SUBSIDIARIES.
Schedule 6.14 sets forth all the Subsidiaries of the Borrower at the
Closing Date, the jurisdiction of their incorporation and the direct or
indirect ownership interest of the Borrower therein.
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6.15 PURPOSE OF LOANS AND LETTERS OF CREDIT.
The proceeds of the Loans hereunder shall be used solely by the
Borrower for general corporate purposes of the Borrower and its Subsidiaries,
including, but not limited to, (1) working capital advances, (2) capital
expenditures in the ordinary course of business, (3) Permitted Investments and
(4) refinancing of existing Indebtedness. The Letters of Credit shall be used
only for or in connection with appeal bonds, reimbursement obligations arising
in connection with performance, surety and reclamation bonds, reinsurance,
domestic or international trade transactions and obligations not otherwise
aforementioned relating to transactions entered into by the Borrower in the
ordinary course of business.
6.16 ENVIRONMENTAL MATTERS.
Except as disclosed and described in Schedule 6.16 attached hereto:
(a) Each of the facilities and properties owned, leased
or operated by the Borrower or any of its Domestic Subsidiaries (the
"Properties") and all operations at the Properties are in material
compliance with all applicable Environmental Laws, and there is no
material violation of any Environmental Law with respect to the
Properties or the businesses operated by the Borrower or any of its
Domestic Subsidiaries (the "Businesses"), and there are no conditions
relating to the Businesses or Properties that could give rise to any
material liability under any applicable Environmental Laws.
(b) None of the Properties contains, or has previously
contained, any Materials of Environmental Concern at, on or under the
Properties in amounts or concentrations that constitute or constituted
a material violation of, or could give rise to any material liability
under, Environmental Laws.
(c) Neither the Borrower nor any of its Domestic
Subsidiaries has received any written or verbal notice of, or inquiry
from any Governmental Authority (other than notices or inquiries that
have been resolved with such Governmental Authority) regarding, any
violation, alleged violation, non-compliance, liability or potential
liability regarding environmental matters or compliance with
Environmental Laws with regard to any of the Properties or the
Businesses, nor does the Borrower or any of its Domestic Subsidiaries
have knowledge or reason to believe that any such notice will be
received or is being threatened.
(d) Materials of Environmental Concern have not been
transported or disposed of from the Properties, or generated, treated,
stored or disposed of at, on or under any of the Properties or any
other location, in each case by or on behalf of the Borrower or any of
its Domestic Subsidiaries, in material violation of, or in a manner
that would be reasonably likely to give rise to any material liability
under, any applicable Environmental Law.
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(e) No judicial proceeding or governmental or
administrative action is pending or, to the best knowledge of any
Credit Party, threatened, under any Environmental Law to which the
Borrower or any of its Domestic Subsidiaries is or will be named as a
party, nor are there any consent decrees or other decrees, consent
orders, administrative orders or other orders, or other administrative
or judicial requirements outstanding under any Environmental Law with
respect to the Borrower, any of its Domestic Subsidiaries, the
Properties or the Businesses.
(f) There has been no release or, threat of release
(other than releases or threats of release that have been resolved
with the Governmental Authorities having jurisdiction) of Materials of
Environmental Concern at or from the Properties, or arising from or
related to the operations (including, without limitation, disposal) of
the Borrower or any of its Domestic Subsidiaries in connection with
the Properties or otherwise in connection with the Businesses, in
violation of or in amounts or in a manner that could give rise to
liability under Environmental Laws which could reasonably be expected
to have a Material Adverse Effect.
SECTION 7
AFFIRMATIVE COVENANTS
Each Credit Party hereby covenants and agrees that so long as this
Credit Agreement is in effect or any amounts payable hereunder or under any
other Credit Document shall remain outstanding, and until all of the
Commitments hereunder shall have terminated:
7.1 INFORMATION COVENANTS.
The Borrower will furnish, or cause to be furnished, to the Agent and
each of the Lenders:
(a) Annual Financial Statements. As soon as available,
and in any event within 91 days after the close of each fiscal year of
the Borrower and its Subsidiaries, a consolidated balance sheet and
income statement of the Borrower and its Subsidiaries, as of the end
of such fiscal year, together with related consolidated statements of
operations and changes in stockholders' equity and of cash flows for
such fiscal year, setting forth in comparative form consolidated
figures for the preceding fiscal year, all such financial information
described above to be in reasonable form and detail and audited by
independent certified public accountants of recognized national
standing reasonably acceptable to the Agent and whose opinion shall be
to the effect that such financial statements have been prepared in
accordance with GAAP (except for changes with which such accountants
concur) and shall not be limited as to the scope of the audit or
qualified as to the status of the Borrower and its Subsidiaries as a
going concern.
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(b) Interim Financial Statements.
(i) Quarterly Financial Statements. As soon as
available, and in any event within 46 days after the close of each
fiscal quarter of the Borrower and its Subsidiaries (other than the
fourth fiscal quarter, in which case 91 days after the end thereof), a
consolidated and consolidating balance sheet and income statement of
the Borrower and its Subsidiaries, as of the end of such fiscal
quarter, together with related consolidated and consolidating
statements of operations and changes in stockholders' equity and of
cash flows for such fiscal quarter in each case setting forth in
comparative form consolidated and consolidating figures for the
corresponding period of the preceding fiscal year, all such financial
information described above to be in reasonable form and detail and
reasonably acceptable to the Agent, and accompanied by a certificate
of the chief financial officer or treasurer of the Borrower to the
effect that such quarterly financial statements fairly present in all
material respects the financial condition of the Borrower and its
Subsidiaries and have been prepared in accordance with GAAP, subject
to changes resulting from audit and normal year-end audit adjustments.
(ii) Monthly Financial Statements. As soon as
available, and in any event within 15 days after the close of each
fiscal month, a consolidated balance sheet and income statement of the
Borrower and its Subsidiaries, as of the end of such month, together
with related consolidated statements of operations and of cash flows
for such month in each case setting forth in comparative form
consolidated figures for the corresponding period of the preceding
fiscal year, all such financial information described above to be in
reasonable form and detail and reasonably acceptable to the Agent, and
accompanied by a certificate of the chief financial officer or
treasurer of the Borrower to the effect that such monthly financial
statements fairly present in all material respects the financial
condition of the Borrower and its Subsidiaries and have been prepared
in accordance with GAAP, subject to changes resulting from audit and
normal year-end audit adjustments.
(c) Officer's Certificate. At the time of delivery of
the financial statements provided for in Sections 7.1(a) and 7.1(b)(i)
above, a certificate of the chief financial officer or treasurer of
the Borrower; substantially in the form of Schedule 7.1(c), (i)
demonstrating compliance with the financial covenants contained in
Section 7.11 by calculation thereof as of the end of each such fiscal
period and (ii) stating that no Default or Event of Default exists, or
if any Default or Event of Default does exist, specifying the nature
and extent thereof and what action the Borrower proposes to take with
respect thereto.
(d) Annual Business Plan and Budgets. Within 60 days
after the end of each fiscal year of the Borrower, beginning with the
fiscal year ending December 28, 1997, an annual business plan and
budget of the Borrower containing, among other things, pro forma
financial statements for the next three (3) fiscal years.
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(e) Borrowing Base Reports. (i) Within 15 days after the
end of each calendar month, a Borrowing Base Report as of the end of
the immediately preceding month and (ii) as soon as available after
the request of the Required Lenders, a Borrowing Base Report as of the
date of such request. Each Borrowing Base Report shall be
substantially in the form of Schedule 7.1(e) and certified by the
chief financial officer or treasurer of the Borrower to be true and
correct as of the date thereof.
(f) Accountant's Certificate. Within the period for
delivery of the annual financial statements provided in Section
7.1(a), a certificate of the accountants conducting the annual audit
stating that they have reviewed this Credit Agreement and stating
further whether, in the course of their audit, they have become aware
of any Default or Event of Default and, if any such Default or Event
of Default exists, specifying the nature and extent thereof.
(g) Auditor's Reports. Promptly upon receipt thereof, a
copy of any other report or "management letter" submitted by
independent accountants to the Borrower or any of its Subsidiaries in
connection with any annual, interim or special audit of the books of
such Person.
(h) Reports. Promptly upon transmission or receipt
thereof, (a) copies of any filings and registrations with, and reports
to or from, the Securities and Exchange Commission, or any successor
agency, and copies of all financial statements, proxy statements,
notices and reports as the Borrower or any of its Subsidiaries shall
send to its shareholders or to a holder of any Indebtedness in excess
of $5,000,000 owed by the Borrower or any of its Subsidiaries in its
capacity as such a holder and (b) upon the request of the Agent, all
reports and written information to and from the United States
Environmental Protection Agency, or any state or local agency
responsible for environmental matters, the United States Occupational
Health and Safety Administration, or any state or local agency
responsible for health and safety matters, or any successor agencies
or authorities concerning environmental, health or safety matters.
(i) Notices. Upon a Credit Party's obtaining knowledge
thereof, the Borrower will give written notice to the Agent
immediately of (a) the occurrence of an event or condition consisting
of a Default or Event of Default, specifying the nature and existence
thereof and what action the Credit Parties propose to take with
respect thereto, and (b) the occurrence of any of the following with
respect to the Borrower or any of its Subsidiaries: (i) the pendency
or commencement of any litigation, arbitral or governmental proceeding
against such Person which if adversely determined is likely to have a
Material Adverse Effect, (ii) the institution of any proceedings
against such Person with respect to, or the receipt of notice by such
Person of potential liability or responsibility for violation, or
alleged violation of any federal, state or local law, rule or
regulation, including but not limited to, Environmental Laws, the
violation of which would likely have a Material Adverse Effect, or
(iii) any notice or determination concerning the imposition of any
withdrawal liability by a Multiemployer Plan against such Person, or
any ERISA Affiliate,
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the determination that a Multiemployer Plan is, or is expected to be,
in reorganization within the meaning of Title IV of ERISA or the
termination of any Plan.
(j) ERISA. Upon any of the Credit Parties obtaining
knowledge thereof, the Borrower will give written notice to the Agent
promptly (and in any event within five business days) of: (i) any
event or condition, including, but not limited to, any Reportable
Event, that constitutes, or might reasonably lead to, a Termination
Event; (ii) with respect to any Multiemployer Plan, the receipt of
notice as prescribed in ERISA or otherwise of any withdrawal liability
assessed against the Borrower or any of its ERISA Affiliates, or of a
determination that any Multiemployer Plan is in reorganization or
insolvent (both within the meaning of Title IV of ERISA); (iii) the
failure to make full payment on or before the due date (including
extensions) thereof of all amounts which the Borrower, any of the
Subsidiaries of the Borrower or any ERISA Affiliate is required to
contribute to each Plan pursuant to its terms and as required to meet
the minimum funding standard set forth in ERISA and the Code with
respect thereto; or (iv) any change in the funding status of any Plan
that reasonably could be expected to have a Material Adverse Effect;
together, with a description of any such event or condition or a copy
of any such notice and a statement by the principal financial officer
of the Borrower briefly setting forth the details regarding such
event, condition, or notice, and the action, if any, which has been or
is being taken or is proposed to be taken by the Credit Parties with
respect thereto. Promptly upon request, the Borrower shall furnish
the Agent and the Lenders with such additional information concerning
any Plan as may be reasonably requested, including, but not limited
to, copies of each annual report/return (Form 5500 series), as well as
all schedules and attachments thereto required to filed with the
Department of Labor and/or the Internal Revenue Service pursuant to
ERISA and the Code, respectively, for each "plan year" (within the
meaning of Section 3(39) of ERISA).
(k) Additional Patents and Trademarks. At the time of
delivery of the financial statements and reports provided for in
Section 7.1(a), a report signed by the chief financial officer or
treasurer of the Borrower setting forth (i) a list of registration
numbers for all patents, trademarks, service marks, tradenames and
copyrights awarded to any Credit Party since the last day of the
immediately preceding fiscal year and (ii) a list of all patent
applications, trademark applications, service mark applications, trade
name applications and copyright applications submitted by any Credit
Party since the last day of the immediately preceding fiscal year and
the status of each such application, all in such form as shall be
reasonably satisfactory to the Agent.
(l) Other Information. With reasonable promptness upon
any such request, such other information regarding the business,
properties or financial condition of the Borrower or any of its
Subsidiaries as the Agent or the Required Lenders may reasonably
request.
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7.2 PRESERVATION OF EXISTENCE AND FRANCHISES.
Except to the extent otherwise permitted under Section 8.4, the
Borrower will, and will cause each of its Subsidiaries to, do all things
necessary to preserve and keep in full force and effect its existence, rights,
franchises and authority.
7.3 BOOKS AND RECORDS.
The Borrower will, and will cause each of its Subsidiaries to, keep
complete and accurate books and records of its transactions in accordance with
good accounting practices on the basis of GAAP (including the establishment and
maintenance of appropriate reserves).
7.4 COMPLIANCE WITH LAW.
The Borrower will, and will cause each of its Subsidiaries to, comply
with all laws, rules, regulations and orders, and all applicable restrictions
imposed by all Governmental Authorities, applicable to it and its property if
noncompliance with any such law, rule, regulation, order or restriction would
have a Material Adverse Effect.
7.5 PAYMENT OF TAXES AND OTHER INDEBTEDNESS.
The Borrower will, and will cause each of its Subsidiaries to, pay and
discharge (i) all taxes, assessments and governmental charges or levies imposed
upon it, or upon its income or profits, or upon any of its properties, before
they shall become delinquent, (ii) all lawful claims (including claims for
labor, materials and supplies) which, if unpaid, might give rise to a Lien upon
any of its properties, and (iii) except as prohibited hereunder, all of its
other Indebtedness as it shall become due; provided, however, that the Borrower
and its Subsidiaries shall not be required to pay any such tax, assessment,
charge, levy, claim or Indebtedness which is being contested in good faith by
appropriate proceedings and as to which adequate reserves therefor have been
established in accordance with GAAP, unless the failure to make any such
payment (i) would give rise to an immediate right to foreclose on a Lien
securing such amounts or (ii) would have a Material Adverse Effect.
7.6 INSURANCE.
The Borrower will, and will cause each of its Subsidiaries to, at all
times maintain in full force and effect insurance (including worker's
compensation insurance, liability insurance, casualty insurance and business
interruption insurance) in such amounts, covering such risks and liabilities
and with such deductibles or self-insurance retentions as are in accordance
with normal industry practice (or as otherwise required by the Collateral
Documents). The Agent shall be named as loss payee or mortgagee, as its
interest may appear, and/or additional insured with respect to any such
insurance providing coverage in respect of any Collateral, and each provider of
any such insurance shall agree, by endorsement upon the policy or policies
issued by it or by independent instruments furnished to the Agent, that it will
give the Agent thirty (30) days prior written notice before any such policy or
policies shall be altered or cancelled, and that no act or default of the
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Borrower or any of its Subsidiaries or any other Person shall affect the rights
of the Agent or the Lenders under such policy or policies.
7.7 MAINTENANCE OF PROPERTY.
The Borrower will, and will cause each of its Subsidiaries to,
maintain and preserve its properties and equipment material to the conduct of
its business in good repair, working order and condition, normal wear and tear
excepted, and will make, or cause to be made, in such properties and equipment
from time to time all repairs, renewals, replacements, extensions, additions,
betterments and improvements thereto as may be needed or proper, to the extent
and in the manner customary for companies in similar businesses.
7.8 PERFORMANCE OF OBLIGATIONS.
The Borrower will, and will cause each of its Subsidiaries to, perform
in all material respects all of its obligations under the terms of all material
agreements, indentures, mortgages, security agreements or other debt
instruments to which it is a party or by which it is bound.
7.9 USE OF PROCEEDS.
The Borrower will use the proceeds of the Loans and will use the
Letters of Credit solely for the purposes set forth in Section 6.15.
7.10 AUDITS/INSPECTIONS.
Upon reasonable notice and during normal business hours, the Borrower
will, and will cause each of its Subsidiaries to, permit representatives
appointed by the Agent, including, without limitation, independent accountants,
agents, attorneys, and appraisers to visit and inspect its property, including
its books and records, its accounts receivable and inventory, its facilities
and its other business assets, and to make photocopies or photographs thereof
and to write down and record any information such representative obtains and
shall permit the Agent or its representatives to investigate and verify the
accuracy of information provided to the Lenders and to discuss all such matters
with the officers, employees and representatives of such Person; provided,
however, that any costs or expenses incurred by the Agent or any of the Lenders
in connection with any of the foregoing shall not be for the Borrower's
account. Each of the Credit Parties agrees that the Agent, and its
representatives, may conduct an annual audit of the Collateral, at the expense
of the Borrower.
7.11 FINANCIAL COVENANTS.
(a) Consolidated Tangible Net Worth. Consolidated
Tangible Net Worth at all times shall be no less than the sum of
$12,500,000, increased on a cumulative basis by an amount equal to (i)
as of the last day of each fiscal quarter commencing with December 26,
1997, 50% of the Consolidated Net Income (without deduction for any
losses) for the
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fiscal quarter then ended, plus (ii) as of the date of any Equity
Transaction, 100% of the Net Proceeds received from such Equity
Transaction.
(b) Consolidated Funded Debt Coverage Ratio. The
Consolidated Funded Debt Coverage Ratio at each Calculation Date shall
be no greater than the following proportions:
<TABLE>
<CAPTION>
Period Ratio
------ -----
<S> <C>
As of the last day of 5.25 to 1.00
the third fiscal quarter
of fiscal year 1997, as
of the last day of the
fourth fiscal quarter of
fiscal year 1997 and as
of the last day of the first
fiscal quarter of fiscal
year 1998 of the Borrower
and its Subsidiaries
As of the last day of 5.00 to 1.00
the second fiscal quarter
of fiscal year 1998 of
the Borrower and its
Subsidiaries
As of the last day of 4.50 to 1.00
the third fiscal quarter
of fiscal year 1998 of
the Borrower and its
Subsidiaries
As of the last day of 3.75 to 1.00
the fourth fiscal quarter
of fiscal year 1998 of
the Borrower and its
Subsidiaries
As of the last day of 3.50 to 1.00
the first fiscal quarter
of fiscal year 1999 of
the Borrower and its
Subsidiaries
</TABLE>
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<PAGE> 85
<TABLE>
<S> <C>
As of the last day of 3.25 to 1.00
the second fiscal quarter
of fiscal year 1999 of
the Borrower and its
Subsidiaries
As of the last day of 3.00 to 1.00
the third fiscal quarter
of fiscal year 1999
of the Borrower and its
Subsidiaries and thereafter
</TABLE>
(c) Consolidated Fixed Charge Coverage Ratio. The
Consolidated Fixed Charge Coverage Ratio at each Calculation Date
shall be no less than the following proportions:
<TABLE>
<CAPTION>
Period Ratio
------ -----
<S> <C>
For the period occurring 1.50 to 1.00
from the Closing Date
through the next to last
day of the fourth fiscal
quarter of fiscal year 1998
of the Borrower and its
Subsidiaries
For the period occurring 1.75 to 1.00
from the last day of the
fourth fiscal quarter of
fiscal year 1998 of the
Borrower and its
Subsidiaries and thereafter
</TABLE>
(d) Consolidated Debt to Capitalization Ratio. The
Consolidated Debt to Capitalization at each Calculation Date shall be
no greater than the following proportions:
<TABLE>
Period Ratio
------ -----
<S> <C>
For the period occurring 0.75 to 1.00
from the Closing Date
through the next to last
day of the fourth fiscal
quarter of fiscal year 1998
of the Borrower and its
Subsidiaries
</TABLE>
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<TABLE>
<S> <C>
For the period occurring 0.65 to 1.00
from the last day of the
fourth fiscal quarter of
fiscal year 1998 of the
Borrower and its
Subsidiaries through
the next to last day of the
fourth fiscal quarter of fiscal
year 1999 of the Borrower
and its Subsidiaries
For the period occurring 0.60 to 1.00
from the last day of the
fourth fiscal quarter of
fiscal year 1999 of the
Borrower and its
Subsidiaries and
thereafter
</TABLE>
7.12 ADDITIONAL CREDIT PARTIES.
As soon as practicable and in any event within 30 days after any
Person becomes a direct or indirect Domestic Subsidiary of the Borrower, the
Borrower shall provide the Agent with written notice thereof setting forth
information in reasonable detail describing all of the assets of such Person
and shall (a) cause such Person to execute a Joinder Agreement in substantially
the same form as Schedule 7.12, (b) cause 100% of the capital stock of such
Person to be delivered to the Agent (together with undated stock powers signed
in blank) and pledged to the Agent pursuant to an appropriate pledge
agreement(s) in substantially the form of the Pledge Agreement and otherwise in
form acceptable to the Agent and (c) cause such Person to (i) if such Person
has any Domestic Subsidiaries, (A) deliver 100% of the capital stock of such
Subsidiaries (together with undated stock powers signed in blank) to the Agent
and (B) execute a pledge agreement in substantially the form of the Pledge
Agreement and otherwise in form acceptable to the Agent, (ii) if such Person
owns or leases any real property located in the United States of America and
deemed to be material by the Agent or the Required Lenders in its or their sole
reasonable discretion, execute any and all necessary mortgages, deeds of trust,
deeds to secure debt or other appropriate real estate collateral documentation
in form acceptable to the Agent and (iii) deliver such other documentation as
the Agent may reasonably request in connection with the foregoing, including,
without limitation, appropriate UCC-1 financing statements, real estate title
insurance policies, environmental reports, landlord's waivers, certified
resolutions and other organizational and authorizing documents of such Person
and favorable opinions of counsel to such Person (which shall cover, among
other things, the legality, validity, binding effect and enforceability of the
documentation referred to above), all in form, content and scope reasonably
satisfactory to the Agent.
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<PAGE> 87
7.13 PLEDGED ASSETS.
(a) The Borrower and each Domestic Subsidiary of the
Borrower will cause all of its real (whether leased or owned) property
located in the United States of America and deemed to be material by
the Agent or the Required Lenders in its or their sole reasonable
discretion, and all of its personal property deemed to be material by
the Agent or the Required Lenders in its or their sole reasonable
discretion (including without limitation 100% of its equity ownership
interest in its Domestic Subsidiaries) to be subject at all times to
first priority, perfected and, in the case of real property (whether
leased or owned), title insured Liens in favor of the Agent pursuant
to the terms and conditions of the Collateral Documents or, with
respect to any such property acquired subsequent to the Closing Date,
such other additional security documents, instruments and other items
as the Agent shall reasonably request. In furtherance of the
foregoing terms of this Section 7.13 and without limiting the terms of
Section 8.4(c), the Borrower agrees to promptly provide the Agent with
written notice of the acquisition by, or the entering into a leasing
by, the Borrower or any of its Domestic Subsidiaries of any asset(s)
having a market value greater than $1,000,000, setting forth in
reasonable detail a description of the asset(s) so acquired.
(b) Without limiting the generality of the terms of
subsection (a) above, the Credit Parties will cause 100% of the
capital stock or other equity interest in each Domestic Subsidiary of
the Borrower to be subject at all times to a first priority, perfected
Lien in favor of the Agent pursuant to the terms and conditions of the
Collateral Documents or such other security documents as the Agent
shall reasonably request.
7.14 INTEREST RATE PROTECTION AGREEMENTS.
The Borrower shall, by November 15, 1997, enter into interest rate
protection agreements protecting against fluctuations in interest rates as to
which the material terms are reasonably satisfactory to the Agent, which
agreements shall provide coverage in an amount equal to at least 50% of the
aggregate outstanding principal balances of the Tranche A Term Loan and the
Tranche B Term Loan and for a duration of at least three (3) years from the
Closing Date.
7.15 OWNERSHIP OF SUBSIDIARIES; DOMESTIC OPERATIONS.
(a) Except to the extent otherwise provided in Section
8.4(b) and Section 8.11, the Borrower shall, directly or indirectly,
own at all times 100% of the capital stock of each of its
Subsidiaries.
(b)(i) The Borrower and its direct and indirect Domestic
Subsidiaries shall own at all times at least 75% of Consolidated Total
Assets and (ii) each direct and indirect Foreign Subsidiary of the
Borrower shall cause its cash and Cash Equivalents from time to time
in excess of $200,000 to be distributed to the Borrower and applied,
first, to the payment of such Foreign Subsidiary's intercompany
obligations for the purchase of goods sold or services rendered,
second, if all intercompany obligations for the purchase of goods sold
and services rendered have been paid, to the repayment of intercompany
loans
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then due, if any, and, lastly, as loan disbursements by such Foreign
Subsidiary to the Borrower.
SECTION 8
NEGATIVE COVENANTS
Each Credit Party hereby covenants and agrees that, so long as this
Credit Agreement is in effect or any amounts payable hereunder or under any
other Credit Document shall remain outstanding, and until all of the
Commitments hereunder shall have terminated:
8.1 INDEBTEDNESS.
The Borrower will not, nor will it permit any of its Subsidiaries to,
contract, create, incur, assume or permit to exist any Indebtedness, except:
(a) Indebtedness arising under this Credit Agreement and
the other Credit Documents;
(b) Indebtedness of the Borrower or any of its Domestic
Subsidiaries existing as of the Closing Date and set forth in Schedule
8.1 (and renewals, refinancings and extensions thereof on terms and
conditions no less favorable to such Person than such existing
Indebtedness);
(c) purchase money Indebtedness (including Capital
Leases) hereafter incurred by the Borrower or any of its Subsidiaries
to finance the purchase of fixed assets provided that (i) the total of
all such Indebtedness for all such Persons taken together shall not
exceed an aggregate principal amount of $2,500,000 at any one time
outstanding (including any such Indebtedness referred to in subsection
(b) above); (ii) such Indebtedness when incurred shall not exceed the
purchase price of the asset(s) financed; and (iii) no such
Indebtedness shall be refinanced for a principal amount in excess of
the principal balance outstanding thereon at the time of such
refinancing;
(d) obligations of the Borrower in respect of interest
rate protection agreements, foreign currency exchange, commodity
purchase or option agreements or other interest or exchange rate or
commodity price hedging agreements entered into in order to manage
existing or anticipated interest rate, exchange rate or commodity
price risks and not for speculative purposes;
(e) Intercompany Indebtedness incurred in the ordinary
course of business and consistent with past practices or for cash
management purposes;
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<PAGE> 89
(f) intercompany Indebtedness of the Foreign Subsidiaries
of the Borrower owing (i) to any other Foreign Subsidiary of the
Borrower or (ii) subject to the terms of Section 8.5, to any Credit
Party;
(g) unsecured Guaranty Obligations of the Borrower in
respect of any Indebtedness permitted pursuant to this Section 8.1;
and
(h) other Indebtedness of any Foreign Subsidiary of the
Borrower not exceeding in aggregate principal amount at any time
outstanding the Foreign Currency Equivalent of $15,000,000 for all
such Persons taken together.
8.2 LIENS.
The Borrower will not, nor will it permit any of its Subsidiaries to,
contract, create, incur, assume or permit to exist any Lien with respect to any
of their Property, whether now owned or after acquired, except for Permitted
Liens.
8.3 NATURE OF BUSINESS.
Neither the Borrower nor any of its Subsidiaries will substantively
alter the character or conduct of the business conducted by any such Person as
of the Closing Date.
8.4 CONSOLIDATION, MERGER, SALE OR PURCHASE OF ASSETS, ETC.
The Borrower will not, nor will it permit any of its Subsidiaries to:
(a) dissolve, liquidate or wind up their affairs, or
enter into any transaction of merger or consolidation; provided,
however, that, so long as no Default or Event of Default would be
directly or indirectly caused as a result thereof, (i) the Borrower
may merge or consolidate with any of its Subsidiaries provided that
the Borrower is the surviving corporation; (ii) any Credit Party
(other than the Borrower) may merge or consolidate with any other
Credit Party (other than the Borrower); (iii) any Credit Party may
merge or consolidate with any Person that is not a Credit Party
provided that (A) such Credit Party is the surviving corporation and
(B) no later than 14 days prior to such merger or consolidation, the
Agent and the Lenders shall have received a certificate of the chief
financial officer or treasurer of the Borrower providing facts or
computations in reasonable detail demonstrating that, after giving
effect on a Pro Forma Basis to such merger or consolidation, no
Default or Event of Default would exist hereunder; (iv) any Subsidiary
of the Borrower that is not a Credit Party may merge or consolidate
with any other Person that is not a Credit Party provided that after
giving effect on a Pro Forma Basis to such merger or consolidation, no
Default or Event of Default would exist hereunder; and (v) any
Wholly-Owned Subsidiary of the Borrower may dissolve, liquidate or
wind up its affairs at any time;
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<PAGE> 90
(b) sell, lease, transfer or otherwise dispose of any
Property (including without limitation pursuant to any sale leaseback
transaction) other than (i) the sale of inventory in the ordinary
course of business for fair consideration, (ii) the sale or
disposition of machinery and equipment no longer used or useful in the
conduct of such Person's business, (iii) the sale or other disposition
of the TIWP Assets on terms and conditions reasonably satisfactory to
the Agent, (iv) other Asset Dispositions provided that the aggregate
amount of the Net Proceeds of all such Asset Dispositions during any
fiscal year of the Borrower and its Subsidiaries does not exceed
$100,000 and (v) subject to the terms of Section 8.8, any other Asset
Disposition, provided that, no later than 14 days prior to such Asset
Disposition, the Agent and the Lenders shall have received a
certificate of the chief financial officer or treasurer of the
Borrower (A) providing facts or computations in reasonable detail
demonstrating that (1) the aggregate cumulative book value of assets
disposed of in all the Asset Dispositions occurring on or after the
Closing Date does not exceed 20% of Consolidated Total Assets as of
the most recent Calculation Date with respect to which the Agent and
the Lenders shall have received the Required Financial Information,
(2) the aggregate cumulative book value of assets disposed of in all
the Asset Dispositions occurring during the then current fiscal year
of the Borrower does not exceed 10% of Consolidated Total Assets as of
the most recent Calculation Date with respect to which the Agent and
the Lenders shall have received the Required Financial Information and
(3) after giving effect on a Pro Forma Basis to such Asset
Disposition, no Default or Event of Default would exist hereunder and
(B) specifying the anticipated or actual date of such Asset
Disposition, briefly describing the assets sold or otherwise disposed
of or to be sold or otherwise disposed of and setting forth the net
book value of such assets and the aggregate consideration and Net
Proceeds to be received for such assets in connection with such Asset
Disposition, and thereafter the Borrower shall, (x) within the
Application Period for such Asset Disposition, apply (or cause its
applicable Subsidiary to apply) an amount equal to the Net Proceeds of
such Asset Disposition to the purchase, acquisition or, in the case of
real property, construction of Alternative Assets or (y) prepay the
Loans in connection with such Asset Disposition to the extent required
by Section 3.3(b)(iii); or
(c) enter into any Acquisition transaction (in a single
transaction or a series of related transactions) except (i) for any
Acquisition having an aggregate purchase price (including any
assumption of liabilities (other than current working capital
liabilities not constituting Indebtedness) in connection therewith,
but excluding any portion of the purchase price for any such
Acquisition consisting of any Capital Stock of the Borrower) in excess
of $5,000,000 without the consent of each Lender, (ii) as otherwise
permitted by Section 8.4(a) and Section 8.5, (iii) for any Acquisition
with respect to which the purchase price consists of any Capital Stock
of the acquiring Person, (iv) for the acquisition of Property in the
ordinary course of business for fair consideration and (v) for other
Acquisitions by the Borrower or any of its Subsidiaries, but only to
the extent that, no later than 14 days prior to such Acquisition, the
Agent and the Lenders shall have received a certificate of the chief
financial officer or treasurer of the Borrower providing facts or
computations in reasonable detail demonstrating that (A) the purchase
price
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<PAGE> 91
(including any assumption of liabilities (other than current working
capital liabilities not constituting Indebtedness) in connection
therewith, but excluding any portion of the purchase price for any
such acquisition consisting of capital stock or other securities of
the Borrower) of any such Acquisition individually does not exceed
$10,000,000, (B) the purchase price (including any assumption of
liabilities (other than current working capital liabilities not
constituting Indebtedness) in connection therewith, but excluding any
portion of the purchase price for any such acquisition consisting of
capital stock or other securities of the Borrower) of all such
Acquisitions (including any Acquisition permitted pursuant to clause
(i) above) occurring during any fiscal year of the Borrower does not
exceed $20,000,000 and (C) after giving effect on a Pro Forma Basis to
such Acquisition (including but not limited to any Indebtedness to be
incurred or assumed by the Borrower or any of its Subsidiaries in
connection therewith), no Default or Event of Default would exist
hereunder.
8.5 ADVANCES, INVESTMENTS, LOANS, ETC.
The Borrower will not, nor will it permit any of its Subsidiaries to,
make Investments in or to any Person, except for Permitted Investments.
8.6 RESTRICTED PAYMENTS.
The Borrower will not, nor will it permit any of its Subsidiaries to,
directly or indirectly declare, order, make or set apart any sum for or pay any
Restricted Payment, except (i) to make dividends payable solely in the same
class of capital stock of such Person, (ii) to make dividends payable to any
Credit Party, (iii) as permitted by Section 8.7, (iv) provided that no Default
or Event of Default has occurred and is continuing at such time or would be
directly or indirectly caused as a result thereof, to make interest payments on
Intercompany Indebtedness and (v) in addition to the foregoing, other
Restricted Payments provided that (A) no Default or Event of Default has
occurred and is continuing at the time of such Restricted Payment or would be
directly or indirectly caused as a result thereof and (B) the aggregate amount
of all such Restricted Payments made pursuant to this clause (v) during any
fiscal year does not exceed 20% of Consolidated Net Income for such fiscal
year.
8.7 PREPAYMENTS OF INDEBTEDNESS, ETC.
The Borrower will not, nor will it permit any of its Subsidiaries to,
(i) after the issuance thereof, amend or modify (or permit the amendment or
modification of) any of the terms of any Indebtedness if such amendment or
modification would add or change any terms in a manner adverse to either the
issuer of such Indebtedness or any of the Lenders, or shorten the final
maturity or average life to maturity or require any payment to be made sooner
than originally scheduled or increase the interest rate applicable thereto or
change any subordination provision thereof, (ii) (A) if any Default or Event of
Default has occurred and is continuing or would be directly or indirectly
caused as a result thereof, make (or give any notice with respect thereto) any
voluntary or optional payment or prepayment or redemption or acquisition for
value of (including
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<PAGE> 92
without limitation, by way of depositing money or securities with the trustee
with respect thereto before due for the purpose of paying when due), refund,
refinance or exchange of, any other Indebtedness (other than Intercompany
Indebtedness) or (B) except as otherwise permitted by Section 8.6(iv), make any
payment or prepayment of any Intercompany Indebtedness or (iii) amend, modify
or change its articles of incorporation (or corporate charter or other similar
organizational document) or bylaws (or other similar document) where such
change would have a Material Adverse Effect.
8.8 TRANSACTIONS WITH AFFILIATES.
The Borrower will not, nor will it permit any of its Subsidiaries to,
enter into or permit to exist any transaction or series of transactions with
any officer, director, shareholder, Subsidiary or Affiliate of such Person
other than (a) advances of working capital to any Credit Party, (b) transfers
of cash and assets to any Credit Party, (c) transactions permitted by Section
8.1(e), Section 8.1(f) or Section 8.1(g)(ii), Section 8.4, Section 8.5 or
Section 8.6, (d) normal compensation and reimbursement of expenses of officers
and directors, (e) except as otherwise specifically limited in this Credit
Agreement, other transactions (including without limitation any such
transaction giving rise to an intercompany trade payable) which are entered
into in the ordinary course of such Person's business on terms and conditions
substantially as favorable to such Person as would be obtainable by it in a
comparable arms-length transactions with a Person other than an officer,
director, shareholder, Subsidiary or Affiliate and (f) other transactions
described in Schedule 8.8.
8.9 FISCAL YEAR.
The Borrower will not, nor will it permit any of its Subsidiaries to,
change its fiscal year except to change the fiscal year of any Person acquired
by the Borrower or any of its Subsidiaries in order to coincide with the fiscal
year of the Borrower and its Subsidiaries.
8.10 LIMITATION ON RESTRICTIONS ON SUBSIDIARY DIVIDENDS AND OTHER
DISTRIBUTIONS, ETC.
The Borrower will not, nor will it permit any of its Subsidiaries to,
directly or indirectly, create or otherwise cause, incur, assume, suffer or
permit to exist or become effective any consensual encumbrance or restriction
of any kind on the ability of any such Person to (a) pay dividends or make any
other distribution on any of such Person's capital stock, (b) subject to
subordination provisions, pay any Indebtedness owed to the Borrower or any
other Credit Party, (c) make loans or advances to any Credit Party or (d)
transfer any of its Property to any Credit Party, except for encumbrances or
restrictions existing under or by reason of (i) customary non-assignment
provisions in any lease governing a leasehold interest, (ii) other agreements
described on Schedule 8.1 attached hereto, and (iii) this Credit Agreement and
the other Credit Documents.
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8.11 ISSUANCE AND SALE OF SUBSIDIARY STOCK.
The Borrower will not, nor will it permit any of its Subsidiaries to,
except (i) to qualify directors where required by applicable law, (ii) to
satisfy legal requirements regarding minimum number of equity holders in
Foreign Subsidiaries, (iii) as otherwise permitted under the terms of Section
8.4(b) and (iv) the issuance of shares of capital stock to the Borrower, sell,
transfer or otherwise dispose of, any shares of capital stock of any of its
Subsidiaries or permit any of its Subsidiaries to issue, sell or otherwise
dispose of, any shares of capital stock of any of its Subsidiaries.
8.12 SALE LEASEBACKS.
Except as otherwise permitted by Section 8.4(c), the Borrower will
not, nor will it permit any of its Subsidiaries to, directly or indirectly,
become or remain liable as lessee or as guarantor or other surety with respect
to any lease, whether an Operating Lease or a Capital Lease, of any Property
(whether real or personal or mixed), whether now owned or hereafter acquired,
(i) which such Person has sold or transferred or is to sell or transfer to any
other Person other than a Credit Party or (ii) which such Person intends to use
for substantially the same purpose as any other Property which has been sold or
is to be sold or transferred by such Person to any other Person other than a
Credit Party in connection with such lease.
8.13 NO FURTHER NEGATIVE PLEDGES.
Except with respect to prohibitions against other encumbrances on
specific Property encumbered to secure payment of particular Indebtedness
(which Indebtedness relates solely to such specific Property, and improvements
and accretions thereto, and is otherwise permitted hereby), the Borrower will
not, nor will it permit any of its Subsidiaries to, enter into, assume or
become subject to any agreement prohibiting or otherwise restricting the
creation or assumption of any Lien upon its properties or assets, whether now
owned or hereafter acquired, or requiring the grant of any security for such
obligation if security is given for some other obligation.
8.14 OPERATING LEASE OBLIGATIONS.
The Borrower will not, nor will it permit any of its Subsidiaries to,
enter into, assume or permit to exist any obligations for the payment of rental
under Operating Leases which in the aggregate for all such Persons would exceed
$12,000,000 in any fiscal year.
SECTION 9
EVENTS OF DEFAULT
9.1 EVENTS OF DEFAULT.
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An Event of Default shall exist upon the occurrence of any of the
following specified events (each an "Event of Default"):
(a) Payment. Any Credit Party shall
(i) default in the payment when due of any
principal of any of the Loans or of any reimbursement
obligations arising from drawings under Letters of Credit, or
(ii) default, and such defaults shall continue for
five (5) or more Business Days, in the payment when due of any
interest on the Loans or on any reimbursement obligations
arising from drawings under Letters of Credit, or of any Fees
or other amounts owing hereunder, under any of the other
Credit Documents or in connection herewith or therewith; or
(b) Representations. Any representation, warranty or
statement made or deemed to be made by any Credit Party herein, in any
of the other Credit Documents, or in any statement or certificate
delivered or required to be delivered pursuant hereto or thereto shall
prove untrue in any material respect on the date as of which it was
deemed to have been made; or
(c) Covenants. Any Credit Party shall
(i) default in the due performance or observance
of any term, covenant or agreement contained in Sections 7.2,
7.9, 7.11, 7.12, 7.14, 7.15, or 8.1 through 8.14, inclusive,
or
(ii) default in the due performance or observance
by it of any term, covenant or agreement (other than those
referred to in subsections (a), (b) or (c)(i) of this Section
9.1) contained in this Credit Agreement and such default shall
continue unremedied for a period of at least 30 days after the
earlier of a responsible officer of a Credit Party becoming
aware of such default or notice thereof by the Agent; or
(d) Other Credit Documents. (i) Any Credit Party shall
default in the due performance or observance of any term, covenant or
agreement in any of the other Credit Documents (subject to applicable
grace or cure periods, if any), or (ii) any Credit Document shall fail
to be in full force and effect or to give the Agent and/or the Lenders
the Liens, rights, powers and privileges purported to be created
thereby; or
(e) Guaranties. The guaranty given by any Guarantor
hereunder (including any Additional Credit Party) or any provision
thereof shall cease to be in full force and effect, or any Guarantor
(including any Additional Credit Party) hereunder or any Person acting
by or on behalf of such Guarantor shall deny or
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disaffirm such Guarantor's obligations under such guaranty, or any
Guarantor shall default in the due performance or observance of any
term, covenant or agreement on its part to be performed or observed
pursuant to any guaranty; or
(f) Bankruptcy Event. Any Bankruptcy Event shall occur
with respect to the Borrower or any of its Subsidiaries; or
(g) Defaults under Other Agreements. With respect to any
Indebtedness (other than Indebtedness outstanding under this Credit
Agreement) in excess of $5,000,000 in the aggregate for the Borrower
and each of its Subsidiaries taken as a whole, (i) the Borrower or any
of its Subsidiaries shall (A) default in any payment (beyond the
applicable grace period with respect thereto, if any) with respect to
any such Indebtedness, or (B) default in the observance or performance
relating to such Indebtedness or contained in any instrument or
agreement evidencing, securing or relating thereto, or any other event
or condition shall occur or condition exist, the effect of which
default or other event or condition is to cause, or permit, the holder
or holders of such Indebtedness (or trustee or agent on behalf of such
holders) to cause (after the giving of any required notice or the
passing of any required period of time or both), any such Indebtedness
to become due prior to its stated maturity; or (ii) any such
Indebtedness shall be declared due and payable, or required to be
prepaid other than by a regularly scheduled required prepayment, prior
to the stated maturity thereof; or
(h) Judgments. One or more judgments or decrees shall be
entered against the Borrower or any of its Subsidiaries involving a
liability of $5,000,000 or more in the aggregate (to the extent not
paid or fully covered by insurance provided by a carrier who has
acknowledged coverage) and any such judgments or decrees shall not
have been vacated, discharged or stayed or bonded pending appeal
within 30 days from the entry thereof; or
(i) ERISA. Any of the following events or conditions, if
such event or condition could have a Material Adverse Effect: (1) any
"accumulated funding deficiency," as such term is defined in Section
302 of ERISA and Section 412 of the Code, whether or not waived, shall
exist with respect to any Plan, or any lien shall arise on the assets
of the Borrower, any of the Subsidiaries of the Borrower or any ERISA
Affiliate in favor of the PBGC or a Plan; (2) a Termination Event
shall occur with respect to a Single Employer Plan, which is, in the
reasonable opinion of the Agent, likely to result in the termination
of such Plan for purposes of Title IV of ERISA; (3) a Termination
Event shall occur with respect to a Multiemployer Plan or Multiple
Employer Plan, which is, in the reasonable opinion of the Agent,
likely to result in (i) the termination of such Plan for purposes of
Title IV of ERISA, or (ii) the Borrower, any of the Subsidiaries of
the Borrower or any ERISA Affiliate incurring any liability in
connection with a withdrawal from, reorganization of (within the
meaning of Section 4241 of ERISA), or
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insolvency or (within the meaning of Section 4245 of ERISA) such Plan;
or (4) any prohibited transaction (within the meaning of Section 406
of ERISA or Section 4975 of the Code) or breach of fiduciary
responsibility shall occur which may subject the Borrower, any of the
Subsidiaries of the Borrower or any ERISA Affiliate to any liability
under Sections 406, 409, 502(i), or 502(l) of ERISA or Section 4975 of
the Code, or under any agreement or other instrument pursuant to which
the Borrower, any of the Subsidiaries of the Borrower or any ERISA
Affiliate has agreed or is required to indemnify any person against
any such liability; or
(j) Ownership. There shall occur a Change of Control.
9.2 ACCELERATION; REMEDIES.
Upon the occurrence of an Event of Default, and at any time thereafter
unless and until such Event of Default has been waived by the Required Lenders
or cured to the satisfaction of the Required Lenders (pursuant to the voting
procedures in Section 11.6), the Agent shall, upon the request and direction of
the Required Lenders, by written notice to the Credit Parties take any of the
following actions without prejudice to the rights of the Agent or any Lender to
enforce its claims against the Credit Parties, except as otherwise specifically
provided for herein:
(i) Termination of Commitments. Declare the
Commitments terminated whereupon the Commitments shall be
immediately terminated.
(ii) Acceleration. Declare the unpaid principal
of and any accrued interest in respect of all Loans, any
reimbursement obligations arising from drawings under Letters
of Credit and any and all other indebtedness or obligations of
any and every kind owing by the Borrower to any of the Lenders
hereunder to be due whereupon the same shall be immediately
due and payable without presentment, demand, protest or other
notice of any kind, all of which are hereby waived by the
Borrower.
(iii) Cash Collateral. Direct the Borrower to pay
(and the Borrower agrees that upon receipt of such notice, or
upon the occurrence of an Event of Default under Section
9.1(f), it will immediately pay) to the Agent additional cash,
to be held by the Agent, for the benefit of the Lenders, in a
cash collateral account as additional security for the LOC
Obligations in respect of subsequent drawings under all then
outstanding Letters of Credit in an amount equal to the
maximum aggregate amount which may be drawn under all Letters
of Credits then outstanding.
(iv) Enforcement of Rights. Enforce any and all
rights and interests created and existing under the Credit
Documents and all rights of set-off.
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Notwithstanding the foregoing, if an Event of Default specified in
Section 9.1(f) shall occur, then the Commitments shall automatically terminate
and all Loans, all reimbursement obligations arising from drawings under
Letters of Credit, all accrued interest in respect thereof, all accrued and
unpaid Fees and other indebtedness or obligations owing to the Lenders
hereunder automatically shall immediately become due and payable without the
giving of any notice or other action by the Agent.
SECTION 10
AGENCY PROVISIONS
10.1 APPOINTMENT.
Each Lender hereby designates and appoints NationsBank of Texas, N.A.
as administrative agent (in such capacity as Agent hereunder, the "Agent") of
such Lender to act as specified herein and the other Credit Documents, and each
such Lender hereby authorizes the Agent as the agent for such Lender, to take
such action on its behalf under the provisions of this Credit Agreement and the
other Credit Documents and to exercise such powers and perform such duties as
are expressly delegated by the terms hereof and of the other Credit Documents,
together with such other powers as are reasonably incidental thereto.
Notwithstanding any provision to the contrary elsewhere herein and in the other
Credit Documents, the Agent shall not have any duties or responsibilities,
except those expressly set forth herein and therein, or any fiduciary
relationship with any Lender, and no implied covenants, functions,
responsibilities, duties, obligations or liabilities shall be read into this
Credit Agreement or any of the other Credit Documents, or shall otherwise exist
against the Agent. The provisions of this Section are solely for the benefit
of the Agent and the Lenders and none of the Credit Parties shall have any
rights as a third party beneficiary of the provisions hereof. In performing
its functions and duties under this Credit Agreement and the other Credit
Documents, the Agent shall not act solely as agent of the Lenders and does not
assume and shall not be deemed to have assumed any obligation or relationship
of agency or trust with or for any Credit Party.
10.2 DELEGATION OF DUTIES.
The Agent may execute any of its respective duties hereunder or under
the other Credit Documents by or through agents or attorneys-in-fact and shall
be entitled to advice of counsel concerning all matters pertaining to such
duties. The Agent shall not be responsible for the negligence or misconduct of
any agents or attorneys-in-fact (other than any Affiliates of the Agent)
selected by it with reasonable care.
10.3 EXCULPATORY PROVISIONS.
Neither the Agent nor any of its officers, directors, employees,
agents, attorneys-in-fact or affiliates shall be (i) liable for any action
lawfully taken or omitted to be taken by it or such Person under or in
connection herewith or in connection with any of the other Credit Documents
(except
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for its or such Person's own negligence or willful misconduct), or (ii)
responsible in any manner to any of the Lenders for any recitals, statements,
representations or warranties made by any of the Credit Parties contained
herein or in any of the other Credit Documents or in any certificate, report,
document, financial statement or other written or oral statement referred to or
provided for in, or received by the Agent under or in connection herewith or in
connection with the other Credit Documents, or enforceability or sufficiency
therefor of any of the other Credit Documents, or for any failure of any Credit
Party to perform its obligations hereunder or thereunder. The Agent shall not
be responsible to any Lender for the effectiveness, genuineness, validity,
enforceability, collectibility or sufficiency of this Credit Agreement, or any
of the other Credit Documents or for any representations, warranties, recitals
or statements made herein or therein or made by the Borrower or any Credit
Party in any written or oral statement or in any financial or other statements,
instruments, reports, certificates or any other documents in connection
herewith or therewith furnished or made by the Agent to the Lenders or by or on
behalf of the Credit Parties to the Agent or any Lender or be required to
ascertain or inquire as to the performance or observance of any of the terms,
conditions, provisions, covenants or agreements contained herein or therein or
as to the use of the proceeds of the Loans or the use of the Letters of Credit
or of the existence or possible existence of any Default or Event of Default or
to inspect the properties, books or records of the Credit Parties.
10.4 RELIANCE ON COMMUNICATIONS.
The Agent shall be entitled to rely, and shall be fully protected in
relying, upon any note, writing, resolution, notice, consent, certificate,
affidavit, letter, cablegram, telegram, telecopy, telex or teletype message,
statement, order or other document or conversation believed by it to be genuine
and correct and to have been signed, sent or made by the proper Person or
Persons and upon advice and statements of legal counsel (including, without
limitation, counsel to any of the Credit Parties, independent accountants and
other experts selected by the Agent with reasonable care). The Agent may deem
and treat the Lenders as the owner of their respective interests hereunder for
all purposes unless a written notice of assignment, negotiation or transfer
thereof shall have been filed with the Agent in accordance with Section 11.3(b)
hereof. The Agent shall be fully justified in failing or refusing to take any
action under this Credit Agreement or under any of the other Credit Documents
unless it shall first receive such advice or concurrence of the Required
Lenders as it deems appropriate or it shall first be indemnified to its
satisfaction by the Lenders against any and all liability and expense which may
be incurred by it by reason of taking or continuing to take any such action.
The Agent shall in all cases be fully protected in acting, or in refraining
from acting, hereunder or under any of the other Credit Documents in accordance
with a request of the Required Lenders (or to the extent specifically provided
in Section 11.6, all the Lenders) and such request and any action taken or
failure to act pursuant thereto shall be binding upon all the Lenders
(including their successors and assigns).
10.5 NOTICE OF DEFAULT.
The Agent shall not be deemed to have knowledge or notice of the
occurrence of any Default or Event of Default hereunder unless the Agent has
received notice from a Lender or a Credit Party referring to the Credit
Document, describing such Default or Event of Default and
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stating that such notice is a "notice of default." In the event that the Agent
receives such a notice, the Agent shall give prompt notice thereof to the
Lenders. The Agent shall take such action with respect to such Default or
Event of Default as shall be reasonably directed by the Required Lenders.
10.6 NON-RELIANCE ON AGENT AND OTHER LENDERS.
Each Lender expressly acknowledges that neither the Agent nor any of
its officers, directors, employees, agents, attorneys-in-fact or affiliates has
made any representations or warranties to it and that no act by the Agent or
any affiliate thereof hereinafter taken, including any review of the affairs of
any Credit Party, shall be deemed to constitute any representation or warranty
by the Agent to any Lender. Each Lender represents to the Agent that it has,
independently and without reliance upon the Agent or any other Lender, and
based on such documents and information as it has deemed appropriate, made its
own appraisal of and investigation into the business, assets, operations,
property, financial and other conditions, prospects and creditworthiness of the
Borrower and the other Credit Parties and made its own decision to make its
Loans hereunder and enter into this Credit Agreement. Each Lender also
represents that it will, independently and without reliance upon the Agent or
any other Lender, and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit analysis, appraisals
and decisions in taking or not taking action under this Credit Agreement, and
to make such investigation as it deems necessary to inform itself as to the
business, assets, operations, property, financial and other conditions,
prospects and creditworthiness of the Borrower and the other Credit Parties.
Except for notices, reports and other documents expressly required to be
furnished to the Lenders by the Agent hereunder, the Agent shall not have any
duty or responsibility to provide any Lender with any credit or other
information concerning the business, operations, assets, property, financial or
other conditions, prospects or creditworthiness of the Borrower and the other
Credit Parties which may come into the possession of the Agent or any of its
officers, directors, employees, agents, attorneys-in-fact or affiliates.
10.7 INDEMNIFICATION.
The Lenders agree to indemnify the Agent in its capacity as such (to
the extent not reimbursed by the Borrower and without limiting the obligation
of the Borrower to do so), ratably according to their respective Commitments
(or if the Commitments have expired or been terminated, in accordance with the
respective principal amounts of outstanding Loans and Participation Interests
of the Lenders), from and against any and all liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or disbursements
of any kind whatsoever which may at any time (including without limitation at
any time following the final payment of all of the obligations of the Borrower
hereunder and under the other Credit Documents) be imposed on, incurred by or
asserted against the Agent in its capacity as such in any way relating to or
arising out of this Credit Agreement or the other Credit Documents or any
documents contemplated by or referred to herein or therein or the transactions
contemplated hereby or thereby or any action taken or omitted by the Agent
under or in connection with any of the foregoing; provided that no Lender shall
be liable for the payment of any portion of such
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liabilities, obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses or disbursements resulting from the negligence or
willful misconduct of the Agent. If any indemnity furnished to the Agent for
any purpose shall, in the opinion of the Agent, be insufficient or become
impaired, the Agent may call for additional indemnity and cease, or not
commence, to do the acts indemnified against until such additional indemnity is
furnished.
10.8 AGENT IN ITS INDIVIDUAL CAPACITY.
The Agent and its affiliates may make loans to, accept deposits from
and generally engage in any kind of business with any Credit Party as though
the Agent were not Agent hereunder. With respect to the Loans made by and all
obligations of the Borrower hereunder and under the other Credit Documents
owing to it, the Agent shall have the same rights and powers under this Credit
Agreement as any Lender and may exercise the same as though they were not
Agent, and the terms "Lender" and "Lenders" shall include the Agent in its
individual capacity.
10.9 SUCCESSOR AGENT.
With and subject to the consent of the Borrower (which consent shall
not be unreasonably withheld), the Agent may, at any time, resign upon 20 days'
written notice to the Lenders. The Agent may be removed with or without cause
by the Required Lenders upon 30 days' written notice to the Agent. Upon any
such resignation or removal, the Required Lenders shall have the right to
appoint a successor Agent reasonably acceptable to the Borrower. If no
successor Agent shall have been so appointed by the Required Lenders, and shall
have accepted such appointment, within 30 days after the notice of resignation
or notice of removal, as appropriate, then the retiring Agent shall select a
successor Agent provided such successor is a Lender hereunder or a commercial
bank organized under the laws of the United States of America or of any State
thereof and has a combined capital and surplus of at least $400,000,000. Upon
the acceptance of any appointment as Agent hereunder by a successor, such
successor Agent shall thereupon succeed to and become vested with all the
rights, powers, privileges and duties of the retiring Agent, and the retiring
Agent shall be discharged from its duties and obligations as Agent, as
appropriate, under this Credit Agreement and the other Credit Documents and the
provisions of this Section 10.9 shall inure to its benefit as to any actions
taken or omitted to be taken by it while it was Agent under this Credit
Agreement.
SECTION 11
MISCELLANEOUS
11.1 NOTICES.
Except as otherwise expressly provided herein, all notices and other
communications shall have been duly given and shall be effective (i) when
delivered, (ii) when transmitted via telecopy (or other facsimile device) to
the number set out below, (iii) the day following the day on which the same has
been delivered prepaid to a reputable national overnight air courier service,
or (iv)
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the third Business Day following the day on which the same is sent by certified
or registered mail, postage prepaid, in each case to the respective parties at
the address, in the case of the Borrower, Guarantors and the Agent, set forth
below, and, in the case of the Lenders, set forth on Schedule 2.1(a), or at
such other address as such party may specify by written notice to the other
parties hereto:
if to the Borrower or the Guarantors:
Genicom Corporation
14800 Conference Center Drive
Suite 400, Westfields
Chantilly, Virginia 20151-3820
Attn: James C. Gale
Telephone: (703) 802-9259
Telecopy: (703) 802-8618
if to the Agent:
NationsBank of Texas, N.A.
901 Main Street
Floor 67
Dallas, Texas 75202
Attn: Yousuf Omar
Telephone: (214) 508-3347
Telecopy: (214) 508-0980
11.2 RIGHT OF SET-OFF.
In addition to any rights now or hereafter granted under applicable
law or otherwise, and not by way of limitation of any such rights, upon the
occurrence of an Event of Default, each Lender is authorized at any time and
from time to time, without presentment, demand, protest or other notice of any
kind (all of which rights being hereby expressly waived), to set-off and to
appropriate and apply any and all deposits (general or special) and any other
indebtedness at any time held or owing by such Lender (including, without
limitation branches, agencies or Affiliates of such Lender wherever located) to
or for the credit or the account of any Credit Party against obligations and
liabilities of such Credit Party to such Lender hereunder, under the Notes, the
other Credit Documents or otherwise, irrespective of whether such Lender shall
have made any demand hereunder and although such obligations, liabilities or
claims, or any of them, may be contingent or unmatured, and any such set-off
shall be deemed to have been made immediately upon the occurrence of an Event
of Default even though such charge is made or entered on the books of such
Lender subsequent thereto. Each of the Credit Parties hereby agrees that any
Person purchasing a participation in the Loans and Commitments hereunder
pursuant to Section 11.3(d) or Section 3.14 may exercise all rights of set-off
with respect to its participation interest as fully as if such Person were a
Lender hereunder.
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11.3 BENEFIT OF AGREEMENT.
(a) Generally. This Credit Agreement shall be binding
upon and inure to the benefit of and be enforceable by the respective
successors and assigns of the parties hereto; provided that none of
the Credit Parties may assign and transfer any of its interests
without prior written consent of the Lenders; provided further that
the rights of each Lender to transfer, assign or grant participations
in its rights and/or obligations hereunder shall be limited as set
forth in this Section 11.3, provided however that nothing herein shall
prevent or prohibit any Lender from (i) pledging its Loans hereunder
to a Federal Reserve Bank in support of borrowings made by such Lender
from such Federal Reserve Bank or (ii) granting assignments or
participation in such Lender's Loans and/or Commitments hereunder to
its parent company and/or any Affiliate or Subsidiary of such Lender.
(b) Assignments. Each Lender may assign all or a portion
of its rights and obligations hereunder pursuant to an assignment
agreement substantially in the form of Schedule 11.3(b) to one or more
Eligible Assignees, provided that (i) any such assignment (other than
any assignment to an existing Lender) shall be in a minimum aggregate
amount of $5,000,000 (or, if less, the remaining amount of the
Commitment being assigned by such Lender) of the Commitments and in
integral multiples of $500,000 above such amount, (ii) each assignment
of a Lender's Revolving Commitment automatically shall constitute an
assignment of a corresponding percentage of such Lender's Foreign
Currency Commitment and (iii) each such assignment shall be of a
constant, not varying, percentage of (A) in the case of an assignment
of all or a portion of a Lender's Revolving Commitment and Foreign
Currency Commitment, all of such Lender's rights and obligations under
this Credit Agreement with respect to the Revolving Commitment and the
Foreign Currency Commitment so assigned, (B) in the case of an
assignment of a Lender's Tranche A Term Loan Commitment, all of such
Lender's rights and obligations under this Credit Agreement with
respect to the Tranche A Term Loan Commitment so assigned and (C) in
the case of an assignment of a Lender's Tranche B Term Loan
Commitment, all of such Lender's rights and obligations under this
Credit Agreement with respect to the Tranche B Term Loan Commitment so
assigned. Any assignment hereunder shall be effective upon delivery
to the Agent of written notice of the assignment together with a
transfer fee of $3,500 payable to the Agent for its own account from
and after the later of (i) the effective date specified in the
applicable assignment agreement and (ii) the date of recording of such
assignment in the Register pursuant to the terms of subsection (c)
below. The assigning Lender will give prompt notice to the Agent and
the Borrower of any such assignment. Upon the effectiveness of any
such assignment (and after notice to, and (to the extent required
pursuant to the terms hereof) with the consent of, the Borrower as
provided herein), the assignee shall become a "Lender" for all
purposes of this Credit Agreement and the other Credit Documents and,
to the extent of such assignment, the assigning Lender shall be
relieved of its obligations hereunder to the extent of the Loans and
Commitment
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components being assigned. Along such lines the Borrower agrees that
upon notice of any such assignment and surrender of the appropriate
Note or Notes, it will promptly provide to the assigning Lender and to
the assignee separate promissory notes in the amount of their
respective interests substantially in the form of the original Note
(but with notation thereon that it is given in substitution for and
replacement of the original Note or any replacement notes thereof).
By executing and delivering an assignment agreement in accordance with
this Section 11.3(b), the assigning Lender thereunder and the assignee
thereunder shall be deemed to confirm to and agree with each other and
the other parties hereto as follows: (i) such assigning Lender
warrants that it is the legal and beneficial owner of the interest
being assigned thereby free and clear of any adverse claim; (ii)
except as set forth in clause (i) above, such assigning Lender makes
no representation or warranty and assumes no responsibility with
respect to any statements, warranties or representations made in or in
connection with this Credit Agreement, any of the other Credit
Documents or any other instrument or document furnished pursuant
hereto or thereto, or the execution, legality, validity,
enforceability, genuineness, sufficiency or value of this Credit
Agreement, any of the other Credit Documents or any other instrument
or document furnished pursuant hereto or thereto or the financial
condition of any Credit Party or the performance or observance by any
Credit Party of any of its obligations under this Credit Agreement,
any of the other Credit Documents or any other instrument or document
furnished pursuant hereto or thereto; (iii) such assignee represents
and warrants that it is legally authorized to enter into such
assignment agreement; (iv) such assignee confirms that it has received
a copy of this Credit Agreement, the other Credit Documents and such
other documents and information as it has deemed appropriate to make
its own credit analysis and decision to enter into such assignment
agreement; (v) such assignee will independently and without reliance
upon the Agent, such assigning Lender or any other Lender, and based
on such documents and information as it shall deem appropriate at the
time, continue to make its own credit decisions in taking or not
taking action under this Credit Agreement and the other Credit
Documents; (vi) such assignee appoints and authorizes the Agent to
take such action on its behalf and to exercise such powers under this
Credit Agreement or any other Credit Document as are delegated to the
Agent by the terms hereof or thereof, together with such powers as are
reasonably incidental thereto; and (vii) such assignee agrees that it
will perform in accordance with their terms all the obligations which
by the terms of this Credit Agreement and the other Credit Documents
are required to be performed by it as a Lender.
(c) Maintenance of Register. The Agent shall maintain at
one of its offices in Charlotte, North Carolina a copy of each Lender
assignment agreement delivered to it in accordance with the terms of
subsection (b) above and a register for the recordation of the
identity of the principal amount, type and Interest Period of each
Loan outstanding hereunder, the names, addresses and the Commitments
of the Lenders pursuant to the terms hereof from time to
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time (the "Register"). The Agent will make reasonable efforts to
maintain the accuracy of the Register and to promptly update the
Register from time to time, as necessary. The entries in the Register
shall be conclusive in the absence of manifest error and the Borrower,
the Agent and the Lenders may treat each Person whose name is recorded
in the Register pursuant to the terms hereof as a Lender hereunder for
all purposes of this Credit Agreement. The Register shall be
available for inspection by the Borrower and each Lender, at any
reasonable time and from time to time upon reasonable prior notice.
(d) Participations. Each Lender may sell, transfer,
grant or assign participations in all or any part of such Lender's
interests and obligations hereunder; provided that (i) such selling
Lender shall remain a "Lender" for all purposes under this Credit
Agreement (such selling Lender's obligations under the Credit
Documents remaining unchanged) and the participant shall not
constitute a Lender hereunder, (ii) no such participant shall have, or
be granted, rights to approve any amendment or waiver relating to this
Credit Agreement or the other Credit Documents except to the extent
any such amendment or waiver would (A) reduce the principal of or rate
of interest on or Fees in respect of any Loans in which the
participant is participating, (B) postpone the date fixed for any
payment of principal (including extension of the Maturity Date or the
date of any mandatory prepayment), interest or Fees in which the
participant is participating, or (C) release any Guarantor from its
guaranty obligations hereunder (except as expressly provided in the
Credit Documents) and (iii) sub-participations by the participant
(except to an affiliate, parent company or affiliate of a parent
company of the participant) shall be prohibited. In the case of any
such participation, the participant shall not have any rights under
this Credit Agreement or the other Credit Documents (the participant's
rights against the selling Lender in respect of such participation to
be those set forth in the participation agreement with such Lender
creating such participation) and all amounts payable by the Borrower
hereunder shall be determined as if such Lender had not sold such
participation, provided, however, that such participant shall be
entitled to receive additional amounts under Sections 3.6, 3.7, 3.10,
3.11 and 3.12 on the same basis as if it were a Lender.
11.4 NO WAIVER; REMEDIES CUMULATIVE.
No failure or delay on the part of the Agent or any Lender in
exercising any right, power or privilege hereunder or under any other Credit
Document and no course of dealing between any of the Credit Parties shall
operate as a waiver thereof; nor shall any single or partial exercise of any
right, power or privilege hereunder or under any other Credit Document preclude
any other or further exercise thereof or the exercise of any other right, power
or privilege hereunder or thereunder. The rights and remedies provided herein
are cumulative and not exclusive of any rights or remedies which the Agent or
any Lender would otherwise have. No notice to or demand on any Credit Party in
any case shall entitle the Borrower or any other Credit Party to any other or
further notice or demand in similar or other circumstances or constitute a
waiver of the rights of the Agent or the Lenders to any other or further action
in any circumstances without notice or demand.
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11.5 PAYMENT OF EXPENSES, ETC.
The Borrower agrees to: (i) pay all reasonable out-of-pocket costs
and expenses of the Agent in connection with the negotiation, preparation,
execution and delivery and administration of this Credit Agreement and the
other Credit Documents and the documents and instruments referred to therein
(including, without limitation, the reasonable fees and expenses of Moore & Van
Allen, special counsel to the Agent) and any amendment, waiver or consent
relating hereto and thereto including, but not limited to, any such amendments,
waivers or consents resulting from or related to any work-out, renegotiation or
restructure relating to the performance by the Credit Parties under this Credit
Agreement and of the Agent and the Lenders in connection with enforcement of
the Credit Documents and the documents and instruments referred to therein
(including, without limitation, in connection with any such enforcement, the
reasonable fees and disbursements of counsel for the Agent and each of the
Lenders); (ii) pay and hold each of the Lenders harmless from and against any
and all present and future stamp and other similar taxes with respect to the
foregoing matters and save each of the Lenders harmless from and against any
and all liabilities with respect to or resulting from any delay or omission
(other than to the extent attributable to such Lender) to pay such taxes; and
(iii) indemnify each Lender, its officers, directors, employees,
representatives and agents from and hold each of them harmless against any and
all losses, liabilities, claims, damages or expenses incurred by any of them as
a result of, or arising out of, or in any way related to, or by reason of (A)
any investigation, litigation or other proceeding (whether or not any Lender is
a party thereto) related to the entering into and/or performance of any Credit
Document or the use of proceeds of any Loans (including other extensions of
credit) hereunder or the consummation of any other transactions contemplated in
any Credit Document, including, without limitation, the reasonable fees and
disbursements of counsel incurred in connection with any such investigation,
litigation or other proceeding or (B) the presence or Release of any Materials
of Environmental Concern at, under or from any Property owned, operated or
leased by the Borrower or any of its Subsidiaries, or the failure by the
Borrower or any of its Subsidiaries to comply with any Environmental Law (but
excluding, in the case of either of clause (A) or (B) above, any such losses,
liabilities, claims, damages or expenses to the extent incurred by reason of
negligence or willful misconduct on the part of the Person to be indemnified).
11.6 AMENDMENTS, WAIVERS AND CONSENTS.
Neither this Credit Agreement nor any other Credit Document nor any of
the terms hereof or thereof may be amended, changed, waived, discharged or
terminated unless such amendment, change, waiver, discharge or termination is
in writing entered into by, or approved in writing by, the Required Lenders and
the Borrower, provided that (a) no such amendment, change, waiver, discharge or
termination shall, without the consent of each Lender, (i) extend the scheduled
maturities (including the final maturity and any mandatory prepayments but in
no event including any amendment or waiver to Section 3.3(b)) of any Loan, or
any portion thereof, or reduce the rate or extend the time of payment of
interest (other than as a result of waiving the applicability of any
post-default increase in interest rates) thereon or fees hereunder or reduce
the principal amount thereof, or increase the Commitments of the Lenders over
the amount thereof in effect (it
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being understood and agreed that a waiver of any Default or Event of Default or
of a mandatory reduction in the total commitments shall not constitute a change
in the terms of any Commitment of any Lender), (ii) except as expressly
permitted in the Credit Documents, release (A) any Collateral or (B) any
Guarantor from its guaranty obligations hereunder, (iii) amend, modify or waive
any provision of this Section or Section 3.6, 3.7, 3.11, 3.12, 3.13, 3.14, 5.1,
5.2, 9.1(a), 11.2, 11.3, 11.5 or 11.9, (iv) reduce any percentage specified in,
or otherwise modify, the definition of "Available Foreign Currency", "Foreign
Currency Equivalent", "Determination Date", "Dollar Amount", "Dollar
Equivalent" or "Required Lenders" or (v) consent to the assignment or transfer
by the Borrower (or Guarantor) of any of its rights and obligations under (or
in respect of) this Credit Agreement and (b) no such amendment, change, waiver,
discharge or termination shall, without the consent of Lenders holding in the
aggregate at least 51% of the outstanding Tranche A Term Loan and at least 51%
of the outstanding Tranche B Term Loan, extend the time for or the amount or
the manner of application of proceeds (including without limitation pursuant to
Section 3.3(b)) of any mandatory prepayment required by Section 3.3(b)(iii) or
(iv). No provision of Section 2.2 may be amended without the consent of the
Issuing Lender, and no provision of Section 10 may be amended without the
consent of the Agent.
11.7 COUNTERPARTS.
This Credit Agreement may be executed in any number of counterparts,
each of which where so executed and delivered shall be an original, but all of
which shall constitute one and the same instrument. It shall not be necessary
in making proof of this Credit Agreement to produce or account for more than
one such counterpart.
11.8 HEADINGS.
The headings of the sections and subsections hereof are provided for
convenience only and shall not in any way affect the meaning or construction of
any provision of this Credit Agreement.
11.9 SURVIVAL.
All indemnities set forth herein, including, without limitation, in
Section 2.2(i), 3.10, 3.12(a), 10.7 or 11.5 shall survive the execution and
delivery of this Credit Agreement, the making of the Loans, the issuance of the
Letters of Credit, the repayment of the Loans, LOC Obligations and other
obligations under the Credit Documents and the termination of the Commitments
hereunder, and all representations and warranties made by the Credit Parties
herein shall survive delivery of the Notes and the making of the Loans and the
issuance of the Letters of Credit hereunder.
11.10 GOVERNING LAW; SUBMISSION TO JURISDICTION; VENUE.
(a) THIS CREDIT AGREEMENT AND THE OTHER CREDIT DOCUMENTS
AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER AND THEREUNDER
SHALL BE GOVERNED BY AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH
THE LAWS
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OF THE COMMONWEALTH OF VIRGINIA. Any legal action or proceeding with
respect to this Credit Agreement or any other Credit Document may be
brought in the courts of the State of North Carolina in Mecklenburg
County, or of the United States for the Western District of North
Carolina, and, by execution and delivery of this Credit Agreement,
each of the Credit Parties hereby irrevocably accepts for itself and
in respect of its property, generally and unconditionally, the
jurisdiction of such courts. Each of the Credit Parties further
irrevocably consents to the service of process out of any of the
aforementioned courts in any such action or proceeding by the mailing
of copies thereof by registered or certified mail, postage prepaid, to
it at the address set out for notices pursuant to Section 11.1, such
service to become effective 30 days after such mailing. Nothing
herein shall affect the right of the Agent to serve process in any
other manner permitted by law or to commence legal proceedings or to
otherwise proceed against any Credit Party in any other jurisdiction.
(b) Each of the Credit Parties hereby irrevocably waives
any objection which it may now or hereafter have to the laying of
venue of any of the aforesaid actions or proceedings arising out of or
in connection with this Credit Agreement or any other Credit Document
brought in the courts referred to in subsection (a) hereof and hereby
further irrevocably waives and agrees not to plead or claim in any
such court that any such action or proceeding brought in any such
court has been brought in an inconvenient forum.
(c) EACH OF THE AGENT, THE LENDERS AND THE CREDIT PARTIES
HEREBY IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY ACTION,
PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR RELATING TO THIS CREDIT
AGREEMENT, ANY OF THE OTHER CREDIT DOCUMENTS OR THE TRANSACTIONS
CONTEMPLATED HEREBY.
11.11 SEVERABILITY.
If any provision of any of the Credit Documents is determined to be
illegal, invalid or unenforceable, such provision shall be fully severable and
the remaining provisions shall remain in full force and effect and shall be
construed without giving effect to the illegal, invalid or unenforceable
provisions.
11.12 ENTIRETY.
This Credit Agreement together with the other Credit Documents
represent the entire agreement of the parties hereto and thereto, and supersede
all prior agreements and understandings, oral or written, if any, including any
commitment letters or correspondence relating to the Credit Documents or the
transactions contemplated herein and therein.
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11.13 BINDING EFFECT; TERMINATION OF THIS CREDIT AGREEMENT;
TERMINATION OF EXISTING CREDIT AGREEMENT.
(a) This Credit Agreement shall become effective at such
time on or after the Closing Date when it shall have been executed by
the Borrower, the Guarantors and the Agent, and the Agent shall have
received copies hereof (telefaxed or otherwise) which, when taken
together, bear the signatures of each Lender, and thereafter this
Credit Agreement shall be binding upon and inure to the benefit of the
Borrower, the Guarantors, the Agent and each Lender and their
respective successors and assigns.
(b) The term of this Credit Agreement shall be until no
Loans, LOC Obligations or any other amounts payable hereunder or under
any of the other Credit Documents shall remain outstanding and until
all of the Commitments hereunder shall have expired or been
terminated.
(c) The Credit Parties and the Lenders (including the
Issuing Lender and the Swingline Lender) party to the Existing Credit
Agreement each hereby agrees that, at such time as this Credit
Agreement shall have become effective pursuant to the terms of the
subsection (a) above, (i) the Existing Credit Agreement automatically
shall be deemed amended and restated in its entirety by this Credit
Agreement, (ii) the Commitments under the Existing Credit Agreement
and as defined therein automatically shall be terminated and replaced
with the Commitments hereunder and (iii) all of the promissory notes
executed by the Borrower in connection with the Existing Credit
Agreement automatically shall be canceled.
11.14 JUDGMENT CURRENCY.
(i) Each Credit Party's obligations hereunder to make
payments in Dollars or in any Available Foreign Currency (the
"Obligation Currency") shall not be discharged or satisfied by any
tender or recovery pursuant to any judgment expressed in or converted
into any currency other than the Obligation Currency, except to the
extent that such tender or recovery results in the effective receipt
by the Agent or a Lender of the full amount of the Obligation Currency
expressed to be payable to the Agent or such Lender under this Credit
Agreement. If, for the purpose of obtaining or enforcing judgment
against any Credit Party in any court or in any jurisdiction, it
becomes necessary to convert into or from any currency other than the
Obligation Currency (such other currency being hereinafter referred to
as the "Judgment Currency") an amount due in the Obligation Currency,
the conversion shall be made, at the Dollar Equivalent or the Foreign
Currency Equivalent, as applicable, determined in each case as of the
Business Day immediately preceding the day on which the judgment is
given (such Business Day being hereinafter referred to as the
"Judgment Currency Conversion Date").
(ii) If there is a change in the rate of exchange
prevailing between the Judgment Currency Conversion Date and the date
of actual payment of the amount due, such amount payable by the
applicable Credit Party shall be reduced or increased, as
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applicable, such that the amount paid in the Judgment Currency, when
converted at the rate of exchange prevailing on the date of payment,
will produce the amount of the Obligation Currency which could have
been purchased with the amount of Judgment Currency stipulated in the
judgment or judicial award at the rate of exchange prevailing on the
Judgment Currency Conversion Date.
11.15 CONFIDENTIALITY.
The Agent and the Lenders agree to keep confidential (and to cause
their respective affiliates, officers, directors, employees, agents and
representatives to keep confidential) all information, materials and documents
furnished to the Agent or any such Lender by or on behalf of the Borrower
(whether before or after the Closing Date) which relates to the Borrower or any
of its Subsidiaries (the "Information"). Notwithstanding the foregoing, the
Agent and each Lender shall be permitted to disclose Information (i) to its
affiliates, officers, directors, employees, agents and representatives in
connection with its participation in any of the transactions evidenced by this
Credit Agreement or any other Credit Documents or the administration of this
Credit Agreement or any other Credit Documents; (ii) to the extent required by
applicable laws and regulations or by any subpoena or similar legal process, or
requested by any Governmental Authority; (iii) to the extent such Information
(A) becomes publicly available other than as a result of a breach of this
Credit Agreement or any agreement entered into pursuant to clause (iv) below,
(B) becomes available to the Agent or such Lender on a non-confidential basis
from a source other than the Borrower or any of its Subsidiaries or (C) was
available to the Agent or such Lender on a non-confidential basis prior to its
disclosure to the Agent or such Lender by the Borrower; (iv) to any assignee or
participant (or prospective assignee or participant) so long as such assignee
or participant (or prospective assignee or participant) first specifically
agrees in a writing furnished to and for the benefit of the Borrower to be
bound by the terms of this Section 11.15; or (v) to the extent that the
Borrower shall have consented in writing to such disclosure. Nothing set forth
in this Section 11.15 shall obligate the Agent or any Lender to return any
materials furnished by the Borrower.
11.16 SOURCE OF FUNDS.
Each of the Lenders hereby represents and warrants to the Borrower
that at least one of the following statements is an accurate representation as
to the source of funds to be used by such Lender in connection with the
financing hereunder:
(a) no part of such funds constitutes assets allocated to
any separate account maintained by such Lender in which any employee
benefit plan (or its related trust) has any interest;
(b) to the extent that any part of such funds constitutes
assets allocated to any separate account maintained by such Lender,
such Lender has disclosed to the Borrower the name of each employee
benefit plan whose assets in such account exceed 10% of the total
assets of such account as of the date of such purchase (and, for
purposes of this
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subsection (b), all employee benefit plans maintained by the same
employer or employee organization are deemed to be a single plan); or
(c) such funds constitute assets of one or more specific
benefit plans which such Lender has identified in writing to the
Borrower.
As used in this Section 11.16, the terms "employee benefit plan" and "separate
account" shall have the respective meanings assigned to such terms in Section 3
of ERISA.
11.17 CONFLICT.
To the extent that there is a conflict or inconsistency between any
provision hereof, on the one hand, and any provision of any Credit Document, on
the other hand, this Credit Agreement shall control.
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IN WITNESS WHEREOF, each of the parties hereto has caused a
counterpart of this Credit Agreement to be duly executed and delivered as of
the date first above written.
BORROWER:
- --------
GENICOM CORPORATION
By /s/James C. Gale
Title: Senior Vice President and Chief Financial
Officer
GUARANTORS:
- ----------
GENICOM INTERNATIONAL HOLDINGS CORPORATION
By /s/James C. Gale
Title: Senior Vice President and Chief Financial
Officer
GENICOM INTERNATIONAL SALES CORPORATION
By /s/James C. Gale
Title: Senior Vice President and Chief Financial
Officer
DELMARVA TECHNOLOGIES CORPORATION
By /s/James C. Gale
Title: Senior Vice President and Chief Financial
Officer
RASTEK CORPORATION
By /s/James C. Gale
Title: Senior Vice President and Chief Financial
Officer
[Signatures Continued]
<PAGE> 112
ENTERPRISING SERVICE SOLUTIONS CORPORATION
By /s/James C. Gale
Title: Senior Vice President and Chief Financial
Officer
PRINTER SYSTEMS CORPORATION
By /s/James C. Gale
Title: Senior Vice President and Chief Financial
Officer
THE PRINTER CONNECTION, INC.
By /s/James C. Gale
Title: Senior Vice President and Chief Financial
Officer
PRINTER SYSTEMS INTERNATIONAL, LTD.
By /s/James C. Gale
Title: Senior Vice President and Chief Financial
Officer
[Signatures Continued]
<PAGE> 113
LENDERS:
- -------
NATIONSBANK OF TEXAS, N.A.
By /s/Yousuf Omar
Title: Senior Vice President
CREDITANSTALT-BANKVEREIN
By /s/Christina T. Schoen
Title: Senior Vice President
By /s/Richard F. Buckanavage
Title: Vice President
DEEPROCK & COMPANY
By: Eaton Vance Management,
as Investment Advison
By /s/Payson F. Swaffield
Title: Vice President
CRESTAR BANK
By /s/William Lindlaw
Title: Vice President
THE RIGGS NATIONAL BANK OF WASHINGTON, D.C.
By /s/Jeffrey P. White
Title: Vice President
[Signatures Continued]
<PAGE> 114
FLOATING RATE PORTFOLIO
By: Chancellor LGT Senior Secured
Management, Inc., as attorney-in -fact
By Stephen M. Alfieri
Title: Managing Director
By
-----------------------------------
Title:
AGENT:
- -----
NATIONSBANK OF TEXAS, N.A.,
as Agent
By /s/ Yousuf Omar
Title: Senior Vice President
<PAGE> 1
Exhibit 99.1
For Further Information:
James C. Gale
Senior Vice President Finance and CFO
703/802-9259
FOR IMMEDIATE RELEASE
- --------------------------------------------------------------------------------
GENICOM CORPORATION SECURES NEW CREDIT FACILITY
Chantilly, VA. - - September 9, 1997 - - GENICOM Corporation (Nasdaq:GECM)
today announced it has closed on a new $110 million revolving credit facility
through a bank syndicate led by NationsBank, N.A. The new facility will be
used to fund working capital requirements and to finance general corporate
activities.
GENICOM said that it could potentially increase the size of the facility to
$125 million by the end of October subject to commitments by new participants
in the syndicate. The effective date of the new facility was September 6,
1997. Concurrent with the completion of the new facility, the Company
announced the early repayment of $9 million of seller financing provided last
year by Texas Instruments in conjunction with GENICOM's acquisition of their
printer business.
Paul T. Winn, President and Chief Executive Officer said, "This new credit
facility ensures that we have adequate and readily available capital to finance
our growth strategy. It also demonstrates the high level of confidence our
lenders have in GENICOM's strategic opportunities."
"While GENICOM continues to generate cash, our working capital requirements
have expanded significantly as a result of two key acquisitions we have made in
the past year to augment our printer business," said James C. Gale, Senior Vice
President Finance and Chief Financial Officer.
In August 1997, the Company announced the acquisition of Digital Equipment
Corporation's Printing Systems Business, which had annual revenues of
approximately $100 million. In September 1996, the Company acquired the Texas
Instruments' printer business, of which as estimated $90 million of revenue has
been retained.
The statements contained in this release which are not historical facts are
forward looking statements that involve risks and uncertainties, including, but
not limited to, the Company's ability to secure new customers and maintain its
current customer base, the risk of customer delays or cancellations in both
on-going and new programs, the ability to integrate acquisitions, supplier
disruptions, the transition to the new Louisville depot, the effect of economic
conditions, the impact of competition and other risks detailed, from time to
time, in the Company's Securities and Exchange Commission filings.
GENICOM Corporation is an international supplier of network integration,
multivendor services and printer solutions. The Enterprising Service Solutions
company (ESSC) provides integrated network solutions which include network
integration, professional services, and help desk support, in addition to logo
and multivendor on site and off site product repair and express parts. The
Document Solutions company (DSC) designs and markets a wide range of computer
printer technologies for general purpose applications. GENICOM, which reported
$303.3 million in revenue in 1996, is headquartered within metropolitan
Washington, D.C.
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