<PAGE>
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON MARCH 28, 1995
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------
SCHEDULE 13E-4
ISSUER TENDER OFFER STATEMENT
(Pursuant to Section 13(e)(1) of the Securities Exchange Act of 1934)
(AMENDMENT NO. 2)
---------------
QUALITY FOOD CENTERS, INC.
(Name of Issuer and Person Filing Statement)
COMMON STOCK, PAR VALUE $.001 PER SHARE
(Title of Class of Securities)
747565109
(CUSIP Number of Class of Securities)
MARC W. EVANGER
VICE PRESIDENT AND CHIEF
FINANCIAL OFFICER,
SECRETARY/TREASURER
QUALITY FOOD CENTERS, INC.
10112 NE 10TH STREET
BELLEVUE, WASHINGTON 98004
(206) 455-3761
(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications
on Behalf of the Person Filing Statement)
------------------------
COPIES TO:
<TABLE>
<S> <C>
Edmund O. Belsheim, Jr. Robert L. Friedman
BOGLE & GATES SIMPSON THACHER & BARTLETT
Two Union Square 425 Lexington Avenue
601 Union Street New York, NY 10017
Seattle, WA 98101-2346 (212-455-2780)
(206-621-1465)
</TABLE>
------------------------
JANUARY 19, 1995
(Date Tender Offer First Published,
Sent or Given to Security Holders)
------------------------
CALCULATION OF FILING FEE
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<TABLE>
<S> <C>
Transaction Valuation* Amount of Filing Fee**
$175,000,000 $35,000
</TABLE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
* Assumes purchase of 7,000,000 shares at $25 per share.
** Paid on January 19, 1995.
/ / Check box if any part of the fee is offset as provided by Rule 0-11(a)(2)
and identify the filing with which the offsetting fee was previously paid.
Identify the previous filing by registration statement number, or the Form or
Schedule and the date of its filing.
Amount Previously Paid: N/A Filing Party: N/A
Form or Registration No: N/A Date Filed: N/A
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE>
This Amendment No. 2 amends and supplements the Issuer Tender Offer
Statement on Schedule 13E-4, dated January 19, 1995, as amended by Amendment No.
1 dated March 9, 1995, of Quality Food Centers, Inc. (the "Company") filed in
connection with the offer by the Company to purchase up to 7,000,000 outstanding
shares of Common Stock, par value $.001 per share, of the Company (the "Shares")
at a price of $25 per Share, net to the seller in cash, upon the terms and
subject to the conditions set forth in the Offer to Purchase dated January 19,
1995, as supplemented by the Supplement dated March 9, 1995 (the "Offer to
Purchase") and the related Letter of Transmittal.
ITEM 1.__SECURITY AND ISSUER.
The response to this Item is hereby supplemented and amended as follows:
The Offer expired at 5:00 P.M., New York City time, on Friday March 17,
1995. According to the Depository, 11,179,838 Shares were validly tendered and
not withdrawn prior to the Expiration Date. The Company accepted 7,000,000
Shares for payment at a price of $25 per Share, in accordance with the terms of
the Offer. The Company will therefore purchase, on a pro rata basis, all Shares
validly tendered pursuant to the Offer and has determined the proration factor
to be 62.6127%.
The Depositary expects to begin mailing checks representing the Purchase
Price of the Shares purchased pursuant to the Offer on Wednesday, March 29, 1995
and will be returning certificates representing unpurchased Shares shortly
thereafter.
ITEM 9. MATERIAL TO BE FILED AS EXHIBITS.
<TABLE>
<S> <C>
(a)(10) Form of Press Release dated March 20, 1995.
(a)(11) Form of Press Release dated March 28, 1995.
(b)(2) Credit Agreement dated as of March 15, 1995 among the Company, Bank of America
National Trust and Savings Association, as Agent, Seattle First National Bank,
as Swingline Lender, Bank of America Illinois, as Issuing Lender and the other
financial institutions party thereto.
</TABLE>
2
<PAGE>
SIGNATURE
After due inquiry and to the best of my knowledge and belief, I certify that
the information set forth in this statement is true, complete and correct.
QUALITY FOOD CENTERS, INC.
By: ________/s/_MARC W. EVANGER_______
Marc W. Evanger
VICE PRESIDENT
Dated: March 28, 1995
3
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT SEQUENTIALLY
NO. DESCRIPTION NUMBERED PAGE
- --------- -------------------------------------------------------------------------------------- --------------
<S> <C> <C>
(a)(10) Form of Press Release dated March 20, 1995.
(a)(11) Form of Press Release dated March 28, 1995.
(b)(2) Credit Agreement dated as of March 15, 1995 among the Company, Bank of America
National Trust and Savings Association, as Agent, Seattle First National Bank, as
Swingline Lender, Bank of America Illinois, as Issuing Lender and the other financial
institutions party thereto.
</TABLE>
<PAGE>
QFC NEWS
- --- RELEASE
Quality Food Centers
- --------------------------------------------------------------------------------
For Immediate Release
CONTACT:
Marc Evanger
Vice President, Chief Financial Officer
(206) 455-3761
- --------------------------------------------------------------------------------
QFC ANNOUNCES SUCCESSFUL COMPLETION OF TENDER OFFER TO PURCHASE
UP TO 7 MILLION SHARES OF ITS COMMON STOCK
BELLEVUE, WASHINGTON -- March 20, 1995 -- Quality Food Centers, Inc.
(NASDAQ:QFCI) announced today that its offer to purchase up to 7 million shares
of its common stock at a price of $25 per share in cash expired at 5:00 P.M.,
New York City time, on Friday, March 17, 1995. Based on a preliminary count at
the time of expiration, approximately 11.2 million shares of QFC common stock,
including shares subject to guarantees of delivery and shares subject to receipt
of additional documentation, had been tendered pursuant to the offer.
The final number of shares to be purchased and the proration factor will be
announced as soon as the results of the offer to purchase are verified. Payment
for shares validly tendered will be made as promptly as practicable.
<PAGE>
QFC NEWS
- --- RELEASE
Quality Food Centers
- --------------------------------------------------------------------------------
For Immediate Release
CONTACT:
Marc Evanger
Vice President, Chief Financial Officer
(206) 455-3761
- --------------------------------------------------------------------------------
QFC ANNOUNCES FINAL RESULTS OF THE TENDER OFFER
BELLEVUE, WASHINGTON -- March 28, 1995 -- Quality Food Centers, Inc.
(NASDAQ:QFCI) announced today that, based on a final count by the depositary,
11,179,838 shares had been tendered pursuant to its tender offer for up to
7,000,000 shares of its common stock. QFC will purchase all shares validly
tendered on a pro rata basis, and has determined the proration factor to be
62.6127%.
QFC expects to begin mailing checks representing the purchase price of
the shares purchased pursuant to the offer on Wednesday, March 29, 1995 and
will return certificates representing unpurchased shares shortly thereafter.
<PAGE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
CREDIT AGREEMENT
DATED AS OF MARCH 15, 1995
AMONG
QUALITY FOOD CENTERS, INC.,
BANK OF AMERICA NATIONAL TRUST
AND SAVINGS ASSOCIATION,
AS AGENT,
SEATTLE FIRST NATIONAL BANK,
AS SWINGLINE LENDER,
BANK OF AMERICA ILLINOIS,
AS ISSUING LENDER
AND
THE OTHER FINANCIAL INSTITUTIONS PARTY HERETO
ARRANGED BY
BA SECURITIES, INC.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE>
TABLE OF CONTENTS
Section Page
ARTICLE I
DEFINITIONS
1.1 Certain Defined Terms. . . . . . . . . . . . . . . . . . . . . . . 1
1.2 Other Interpretive Provisions. . . . . . . . . . . . . . . . . . . 19
1.3 Accounting Principles. . . . . . . . . . . . . . . . . . . . . . . 20
ARTICLE II
THE CREDITS
2.1 Amounts and Terms of Commitments . . . . . . . . . . . . . . . . . 20
(a) The Term Credit . . . . . . . . . . . . . . . . . . . . . . . 20
(b) The Revolving Credit. . . . . . . . . . . . . . . . . . . . . 20
2.2 Loan Accounts. . . . . . . . . . . . . . . . . . . . . . . . . . . 21
2.3 Procedure for Borrowing of Term Loans and
Revolving Loans. . . . . . . . . . . . . . . . . . . . . . . . . 21
2.4 Conversion and Continuation Elections. . . . . . . . . . . . . . . 22
2.5 Swingline Loans. . . . . . . . . . . . . . . . . . . . . . . . . . 23
2.6 Voluntary Termination or Reduction of Commitments. . . . . . . . . 26
2.7 Optional Prepayments of Revolving Loans and Term Loans . . . . . . 26
2.8 Mandatory Credit Reductions. . . . . . . . . . . . . . . . . . . . 27
(a) Excess Outstandings . . . . . . . . . . . . . . . . . . . . . 27
(b) Asset Sales . . . . . . . . . . . . . . . . . . . . . . . . . 27
(c) Revolving Commitment Reductions . . . . . . . . . . . . . . . 27
2.9 Repayment. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
(a) The Term Credit . . . . . . . . . . . . . . . . . . . . . . . 27
(b) The Revolving Credit. . . . . . . . . . . . . . . . . . . . . 27
2.10 Interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
2.11 Fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
(a) Arrangement, Agency Fees. . . . . . . . . . . . . . . . . . . 28
(b) Up-Front Fee. . . . . . . . . . . . . . . . . . . . . . . . . 29
(c) Commitment Fees . . . . . . . . . . . . . . . . . . . . . . . 29
2.12 Computation of Fees and Interest . . . . . . . . . . . . . . . . . 29
2.13 Payments by the Company. . . . . . . . . . . . . . . . . . . . . . 30
2.14 Payments by the Lenders to the Agent . . . . . . . . . . . . . . . 30
2.15 Sharing of Payments, Etc.. . . . . . . . . . . . . . . . . . . . . 31
ARTICLE III
THE LETTERS OF CREDIT
3.1 The Letter of Credit Subfacility.. . . . . . . . . . . . . . . . . 32
3.2 Issuance, Amendment and Renewal of Letters of Credit . . . . . . . 33
3.3 Risk Participations, Drawings and Reimbursements . . . . . . . . . 35
3.4 Repayment of Participations. . . . . . . . . . . . . . . . . . . . 37
3.5 Role of the Issuing Lender . . . . . . . . . . . . . . . . . . . . 37
3.6 Obligations Absolute . . . . . . . . . . . . . . . . . . . . . . . 38
3.7 Cash Collateral Pledge . . . . . . . . . . . . . . . . . . . . . . 39
3.8 Letter of Credit Fees. . . . . . . . . . . . . . . . . . . . . . . 39
3.9 Uniform Customs and Practice . . . . . . . . . . . . . . . . . . . 40
ARTICLE IV
i
<PAGE>
Section Page
TAXES, YIELD PROTECTION AND ILLEGALITY
4.1 Taxes. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
4.2 Illegality . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
4.3 Increased Costs and Reduction of Return. . . . . . . . . . . . . . 43
4.4 Funding Losses . . . . . . . . . . . . . . . . . . . . . . . . . . 44
4.5 Inability to Determine Rates . . . . . . . . . . . . . . . . . . . 44
4.6 Certificates of Lenders. . . . . . . . . . . . . . . . . . . . . . 45
4.7 Substitution of Lenders. . . . . . . . . . . . . . . . . . . . . . 45
4.8 Survival . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
ARTICLE V
CONDITIONS PRECEDENT
5.1 Conditions of Initial Credit Extensions. . . . . . . . . . . . . . 45
(a) Credit Agreement and Notes. . . . . . . . . . . . . . . . . . 46
(b) Resolutions; Incumbency . . . . . . . . . . . . . . . . . . . 46
(c) Organization Documents; Good Standing; Other Documents. . . . 46
(d) Legal Opinions. . . . . . . . . . . . . . . . . . . . . . . . 46
(e) Payment of Fees . . . . . . . . . . . . . . . . . . . . . . . 47
(f) Certificate . . . . . . . . . . . . . . . . . . . . . . . . . 47
(g) Security Agreement, etc.. . . . . . . . . . . . . . . . . . . 47
(h) Other Documents . . . . . . . . . . . . . . . . . . . . . . . 47
5.2 Conditions to All Credit Extensions. . . . . . . . . . . . . . . . 47
(a) Notice, Application . . . . . . . . . . . . . . . . . . . . . 47
(b) Continuation of Representations and Warranties. . . . . . . . 48
(c) No Existing Default . . . . . . . . . . . . . . . . . . . . . 48
ARTICLE VI
REPRESENTATIONS AND WARRANTIES
6.1 Corporate Existence and Power. . . . . . . . . . . . . . . . . . . 48
6.2 Corporate Authorization; No Contravention. . . . . . . . . . . . . 48
6.3 Governmental Authorization . . . . . . . . . . . . . . . . . . . . 49
6.4 Binding Effect . . . . . . . . . . . . . . . . . . . . . . . . . . 49
6.5 Litigation . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
6.6 No Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
6.7 ERISA Compliance . . . . . . . . . . . . . . . . . . . . . . . . . 50
6.8 Use of Proceeds; Margin Regulations. . . . . . . . . . . . . . . . 50
6.9 Title to Properties. . . . . . . . . . . . . . . . . . . . . . . . 50
6.10 Taxes. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
6.11 Financial Condition. . . . . . . . . . . . . . . . . . . . . . . . 51
6.12 Environmental Matters. . . . . . . . . . . . . . . . . . . . . . . 52
6.13 Regulated Entities . . . . . . . . . . . . . . . . . . . . . . . . 52
6.14 No Burdensome Restrictions . . . . . . . . . . . . . . . . . . . . 52
6.15 Copyrights, Patents, Trademarks and Licenses, etc. . . . . . . . . 52
6.16 Subsidiaries . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
6.17 Insurance. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
6.18 Full Disclosure. . . . . . . . . . . . . . . . . . . . . . . . . . 52
ii
<PAGE>
Section Page
ARTICLE VII
AFFIRMATIVE COVENANTS
7.1 Financial Statements . . . . . . . . . . . . . . . . . . . . . . . 53
7.2 Certificates; Other Information. . . . . . . . . . . . . . . . . . 54
7.3 Notices. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54
7.4 Preservation of Corporate Existence, Etc.. . . . . . . . . . . . . 55
7.5 Maintenance of Property. . . . . . . . . . . . . . . . . . . . . . 56
7.6 Insurance. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56
7.7 Payment of Obligations . . . . . . . . . . . . . . . . . . . . . . 56
7.8 Compliance with Laws . . . . . . . . . . . . . . . . . . . . . . . 56
7.9 Compliance with ERISA. . . . . . . . . . . . . . . . . . . . . . . 56
7.10 Inspection of Property and Books and Records . . . . . . . . . . . 56
7.11 Environmental Laws . . . . . . . . . . . . . . . . . . . . . . . . 57
7.12 Use of Proceeds. . . . . . . . . . . . . . . . . . . . . . . . . . 57
7.13 Business . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57
7.14 Further Assurances . . . . . . . . . . . . . . . . . . . . . . . . .57
ARTICLE VIII
NEGATIVE COVENANTS
8.1 Limitation on Liens. . . . . . . . . . . . . . . . . . . . . . . . 57
8.2 Consolidations and Mergers . . . . . . . . . . . . . . . . . . . . 59
8.3 Loans and Investments. . . . . . . . . . . . . . . . . . . . . . . 59
8.4 Limitation on Indebtedness . . . . . . . . . . . . . . . . . . . . 60
8.5 Transactions with Affiliates . . . . . . . . . . . . . . . . . . . 61
8.6 Use of Proceeds. . . . . . . . . . . . . . . . . . . . . . . . . . 61
8.7 Contingent Obligations . . . . . . . . . . . . . . . . . . . . . . 61
8.8 Joint Ventures . . . . . . . . . . . . . . . . . . . . . . . . . . 62
8.9 Restricted Payments. . . . . . . . . . . . . . . . . . . . . . . . 62
8.10 Interest and Rental Expense Coverage Ratio . . . . . . . . . . . . 63
8.11 Fixed Charge Coverage Ratio. . . . . . . . . . . . . . . . . . . . 63
8.12 Funded Debt to EBITDA Ratio. . . . . . . . . . . . . . . . . . . . 63
8.13 Trade Support Ratio. . . . . . . . . . . . . . . . . . . . . . . . 63
8.14 Net Worth. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 64
8.15 ERISA. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 64
8.16 Change in Business . . . . . . . . . . . . . . . . . . . . . . . . 64
8.17 Hostile Acquisitions . . . . . . . . . . . . . . . . . . . . . . . 64
8.18 Accounting Changes . . . . . . . . . . . . . . . . . . . . . . . . 64
8.19 Amendments to Certain Documents. . . . . . . . . . . . . . . . . . 64
ARTICLE IX
EVENTS OF DEFAULT
9.1 Event of Default . . . . . . . . . . . . . . . . . . . . . . . . . 65
(a) Non-Payment . . . . . . . . . . . . . . . . . . . . . . . . . 65
(b) Representation or Warranty. . . . . . . . . . . . . . . . . . 65
(c) Specific Defaults . . . . . . . . . . . . . . . . . . . . . . 65
(d) Other Defaults. . . . . . . . . . . . . . . . . . . . . . . . 65
(e) Cross-Default . . . . . . . . . . . . . . . . . . . . . . . . 65
(f) Insolvency; Voluntary Proceedings . . . . . . . . . . . . . . 66
iii
<PAGE>
Section Page
(g) Involuntary Proceedings . . . . . . . . . . . . . . . . . . . 66
(h) ERISA . . . . . . . . . . . . . . . . . . . . . . . . . . . . 66
(i) Monetary Judgments. . . . . . . . . . . . . . . . . . . . . . 66
(j) Non-Monetary Judgments. . . . . . . . . . . . . . . . . . . . 67
(k) Change of Control . . . . . . . . . . . . . . . . . . . . . . 67
(l) Standstill Agreement. . . . . . . . . . . . . . . . . . . . . 67
(m) Security Agreement, etc.. . . . . . . . . . . . . . . . . . . 67
9.2 Remedies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 67
9.3 Rights Not Exclusive . . . . . . . . . . . . . . . . . . . . . . . 68
ARTICLE X
THE AGENT
10.1 Appointment and Authorization. . . . . . . . . . . . . . . . . . . 68
10.2 Delegation of Duties . . . . . . . . . . . . . . . . . . . . . . . 69
10.3 Liability of Agent . . . . . . . . . . . . . . . . . . . . . . . . 69
10.4 Reliance by Agent. . . . . . . . . . . . . . . . . . . . . . . . . 69
10.5 Notice of Default. . . . . . . . . . . . . . . . . . . . . . . . . 70
10.6 Credit Decision. . . . . . . . . . . . . . . . . . . . . . . . . . 70
10.7 Indemnification of Agent . . . . . . . . . . . . . . . . . . . . . 71
10.8 Agent in Individual Capacity . . . . . . . . . . . . . . . . . . . 71
10.9 Successor Agent. . . . . . . . . . . . . . . . . . . . . . . . . . 71
10.10 Withholding Tax. . . . . . . . . . . . . . . . . . . . . . . . . . 72
ARTICLE XI
MISCELLANEOUS
11.1 Amendments and Waivers . . . . . . . . . . . . . . . . . . . . . . 74
11.2 Notices. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 75
11.3 No Waiver; Cumulative Remedies . . . . . . . . . . . . . . . . . . 75
11.4 Costs and Expenses . . . . . . . . . . . . . . . . . . . . . . . . 76
11.5 Company Indemnification. . . . . . . . . . . . . . . . . . . . . . 76
11.6 Payments Set Aside . . . . . . . . . . . . . . . . . . . . . . . . 77
11.7 Successors and Assigns . . . . . . . . . . . . . . . . . . . . . . 77
11.8 Assignments, Participations, etc.. . . . . . . . . . . . . . . . . 77
11.9 Confidentiality. . . . . . . . . . . . . . . . . . . . . . . . . . 79
11.10 Set-off. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 80
11.11 Automatic Debits of Fees . . . . . . . . . . . . . . . . . . . . . 80
11.12 Notification of Addresses, Lending Offices, Etc. . . . . . . . . . 80
11.13 Counterparts . . . . . . . . . . . . . . . . . . . . . . . . . . . 80
11.14 Severability . . . . . . . . . . . . . . . . . . . . . . . . . . . 80
11.15 No Third Parties Benefited . . . . . . . . . . . . . . . . . . . . 81
11.16 Subsidiary References. . . . . . . . . . . . . . . . . . . . . . . .81
11.17 Governing Law and Jurisdiction . . . . . . . . . . . . . . . . . . 81
11.18 Waiver of Jury Trial . . . . . . . . . . . . . . . . . . . . . . . 81
11.19 Entire Agreement . . . . . . . . . . . . . . . . . . . . . . . . . .82
iv
<PAGE>
SCHEDULES
Schedule 1.1(a) Pricing Schedule
Schedule 1.1(b) Commitments and Pro Rata Shares
Schedule 1.1(c) Properties Held For Sale
Schedule 2.1 Amounts of Revolving Commitment and Term Commitment
Schedule 2.9 Repayment/Reduction Dates
Schedule 6.5 Litigation
Schedule 6.7 ERISA
Schedule 6.11 Liabilities
Schedule 6.12 Environmental Matters
Schedule 6.16 Subsidiaries and Minority Interests
Schedule 6.17 Insurance Matters
Schedule 8.1 Liens
Schedule 8.4 Indebtedness
Schedule 8.7 Contingent Obligations
Schedule 8.14 Net Worth Base Level
Schedule 11.2 Offshore and Domestic Lending Offices; Addresses for
Notices
EXHIBITS
Exhibit A Form of Notice of Borrowing
Exhibit B Form of Notice of Conversion/Continuation
Exhibit C Form of Compliance Certificate
Exhibit D-1 Form of Legal Opinion of Bogle & Gates
Exhibit D-2 Form of Opinion of Rosenberg & Liebentritt
Exhibit E Form of Legal Opinion of Special Counsel to the Agent
Exhibit F Form of Assignment and Acceptance
Exhibit G Form of Promissory Note
Exhibit H Form of Security Agreement
Exhibit I Form of Trademark Security Agreement
v
<PAGE>
CREDIT AGREEMENT
This CREDIT AGREEMENT is entered into as of March 15, 1995, among Quality
Food Centers, Inc., a Washington corporation (the "COMPANY"), the financial
institutions from time to time party to this Agreement (collectively the
"LENDERS"; individually each a "LENDER"), Seattle First National Bank, as
swingline lender, Bank of America Illinois, as letter of credit issuing lender,
and Bank of America National Trust and Savings Association, as agent for the
Lenders.
WHEREAS, the Lenders have agreed to make available to the Company a term
loan and revolving credit facility with letter of credit subfacility upon the
terms and conditions set forth in this Agreement;
NOW, THEREFORE, in consideration of the mutual agreements contained herein,
the parties agree as follows:
ARTICLE I
DEFINITIONS
1.1 CERTAIN DEFINED TERMS. The following terms have the following
meanings:
ACQUISITION means any transaction for the purpose of or resulting,
directly or indirectly, in (a) the acquisition of all or substantially all
of the assets of a Person, or of any business unit (including any retail
store) or division of a Person, (b) the acquisition of in excess of 50% of
the capital stock, partnership interests, membership interests or equity of
any Person, or otherwise causing any Person to become a Subsidiary, or
(c) a merger or consolidation or any similar combination with another
Person (other than a Person that is a Subsidiary) provided that the Company
or a Subsidiary is the surviving entity.
AFFECTED LENDER has the meaning specified in SECTION 4.7.
AFFILIATE means, as to any Person, any other Person which, directly or
indirectly, is in control of, is controlled by, or is under common control
with, such Person. A Person shall be deemed to control another Person if
the controlling Person possesses, directly or indirectly, the power (a) to
direct or cause the direction of the management and policies of the other
Person, whether through the ownership of voting securities, membership
interests, by contract, or otherwise, or (b) to vote 10% or more of the
securities (on a fully diluted basis) having ordinary voting power for
election of directors, managing general partners or similar officials of
the other Person.
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AGENT means BofA in its capacity as agent for the Lenders hereunder,
and any successor agent arising under SECTION 10.9.
AGENT-RELATED PERSONS means BofA and any successor agent arising under
SECTION 10.9, BAI and any other Issuing Lender hereunder, and Seafirst and
any successor Swingline Lender hereunder, together with their respective
Affiliates (including the Arranger), and the officers, directors,
employees, agents and attorneys-in-fact of such Persons and Affiliates.
AGENT'S PAYMENT OFFICE means the address for payments set forth on the
signature page hereto in relation to the Agent, or such other address as
the Agent may from time to time specify.
AGREEMENT means this Credit Agreement.
APPLICABLE MARGIN means
(i) with respect to Base Rate Loans, 0%; and
(ii) with respect to Offshore Rate Loans, (a) initially, 1% if
Case 1 applies and 1.25% if Case 2 applies; and (b) beginning on the
date six months after the date of the initial Loans, the Applicable
Margin set forth in SCHEDULE 1.1(a).
ARRANGER means BA Securities, Inc., a Delaware corporation.
ASSET SALE means any sale, lease or other disposition by the Company
or any Subsidiary of any assets outside the ordinary course of business
(excluding Sale-Leasebacks but including sales of surplus property).
ASSIGNEE has the meaning specified in SUBSECTION 11.8(a).
ASSIGNMENT AND ACCEPTANCE has the meaning specified in SUBSECTION
11.8(a).
ATTORNEY COSTS means and includes all reasonable fees and
disbursements of any law firm or other external counsel and, without
duplication, the reasonable allocated cost of internal legal services and
all reasonable disbursements of internal counsel.
BAI means Bank of America Illinois, an Illinois banking corporation.
BANKRUPTCY CODE means the Federal Bankruptcy Reform Act of 1978 (11
U.S.C. Section 101, ET SEQ.).
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BASE RATE means, for any day, the higher of: (a) 0.50% per annum
above the latest Federal Funds Rate; and (b) the rate of interest in
effect for such day as publicly announced from time to time by BofA in San
Francisco, California, as its "reference rate." (The "reference rate" is a
rate set by BofA based upon various factors including BofA's costs and
desired return, general economic conditions and other factors, and is used
as a reference point for pricing some loans, which may be priced at, above,
or below such announced rate.) Any change in the reference rate announced
by BofA shall take effect at the opening of business on the day specified
in the public announcement of such change.
BASE RATE LOAN means a Loan, or an L/C Advance, that bears interest
based on the Base Rate.
BOFA means Bank of America National Trust and Savings Association, a
national banking association.
BORROWING means a borrowing hereunder consisting of (a) Revolving
Loans or Term Loans of the same Type made to the Company on the same day by
the Lenders and, other than in the case of Base Rate Loans, having the same
Interest Period or (b) a Swingline Loan made to the Company by the
Swingline Lender, in each case pursuant to ARTICLE II.
BORROWING DATE means any date on which a Borrowing occurs under
SECTION 2.3 or 2.5.
BUSINESS DAY means any day other than a Saturday, Sunday or other day
on which commercial banks in Seattle, Chicago or San Francisco are
authorized or required by law to close and, if the applicable Business Day
relates to any Offshore Rate Loan, means such a day on which dealings are
carried on in the applicable offshore dollar interbank market.
CAPITAL ADEQUACY REGULATION means any guideline, request or directive
of any central bank or other Governmental Authority, or any other law, rule
or regulation, whether or not having the force of law, in each case,
regarding capital adequacy of any bank or of any corporation controlling a
bank.
CASE 1 means that fewer than 4,000,000 Shares are duly tendered and
repurchased pursuant to the Tender Offer.
CASE 2 means that 4,000,000 or more Shares are duly tendered and
repurchased pursuant to the Tender Offer.
CASH COLLATERALIZE means to pledge and deposit with or deliver to the
Agent, for the benefit of the Agent, the Issuing Lender and the Lenders, as
additional collateral for the L/C Obligations, cash or deposit account
balances
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pursuant to documentation in form and substance satisfactory to the Agent
and the Issuing Lender (which documents are hereby consented to by the
Lenders). Derivatives of such term shall have corresponding meanings. The
Company hereby grants the Agent, for the benefit of the Agent, the Issuing
Lender and the Lenders, a security interest in all such cash and deposit
account balances. Cash collateral shall be maintained in blocked, interest
bearing deposit accounts at BofA.
CLOSING DATE means the date on which all conditions precedent set
forth in SECTION 5.1 are satisfied or waived by all Lenders (or, in the
case of SUBSECTION 5.1(e), waived by the Person entitled to receive such
payment).
CODE means the Internal Revenue Code of 1986, and regulations
promulgated thereunder.
COMMITMENT means, as to each Lender, the amount set forth opposite
such Lender's name on SCHEDULE 1.1(b) as (a) reduced (if applicable) on the
Closing Date to correspond to such Lender's Pro Rata Share of the aggregate
amount of the Revolving Commitment and the Term Commitment, as determined
on such date pursuant to the terms hereof, and (b) as further adjusted from
time to time in accordance with the terms of this Agreement.
COMMITMENT FEE RATE means (a) during the period from March 3, 1995 to
the Closing Date, 0.375% per annum; (b) during the period from the Closing
Date to the date which is six months after the date of the initial Loans,
0.3% per annum if Case 1 applies and 0.375% per annum if Case 2 applies;
and (c) thereafter, the applicable Commitment Fee Rate per annum set forth
in SCHEDULE 1.1(a).
COMPLIANCE CERTIFICATE means a certificate substantially in the form
of EXHIBIT C.
COMPUTATION PERIOD means any period of four consecutive fiscal
quarters of the Company ending on the last day of a fiscal quarter;
PROVIDED that the Computation Periods ending on June 17, 1995, September 9,
1995 and December 30, 1995 shall be comprised of the one, two and three
fiscal quarter periods, respectively, ending on such dates.
CONTINGENT OBLIGATION means, as to any Person, any direct or indirect
liability of that Person, whether or not contingent, with or without
recourse, (a) with respect to any Indebtedness, lease, dividend, letter of
credit or other obligation (the "primary obligation") of another Person
(the "primary obligor"), including any obligation of that Person (i) to
purchase, repurchase or otherwise acquire such primary obligation or any
security therefor, (ii) to advance or provide funds for the payment or
discharge of such
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primary obligation, or to maintain working capital or equity capital of the
primary obligor or otherwise to maintain the net worth or solvency or any
balance sheet item, level of income or financial condition of the primary
obligor, (iii) to purchase property, securities or services primarily for
the purpose of assuring the owner of such primary obligation of the ability
of the primary obligor to make payment of such primary obligation, or (iv)
otherwise to assure or hold harmless the holder of such primary obligation
against loss in respect thereof (each, a "GUARANTY OBLIGATION"); (b) with
respect to any Surety Instrument (other than any Letter of Credit) issued
for the account of that Person or as to which that Person is otherwise
liable for reimbursement of drawings or payments; (c) to purchase any
materials, supplies or other property from, or to obtain the services of,
another Person if the relevant contract or other related document or
obligation requires that payment for such materials, supplies or other
property, or for such services, shall be made regardless of whether
delivery of such materials, supplies or other property is ever made or
tendered, or such services are ever performed or tendered; or (d) in
respect of any Swap Contract. The amount of any Contingent Obligation
shall (a) in the case of any Guaranty Obligation, be deemed equal to the
stated or determinable amount of the primary obligation in respect of which
such Guaranty Obligation is made or, if not stated or if indeterminable,
the maximum reasonably anticipated liability in respect thereof, and (b) in
the case of any other Contingent Obligation, be equal to the maximum
reasonably anticipated liability in respect thereof.
CONTRACTUAL OBLIGATION means, as to any Person, any provision of any
security issued by such Person or of any agreement, undertaking, contract,
indenture, mortgage, deed of trust or other instrument, document or
agreement to which such Person is a party or by which it or any of its
property is bound.
CONVERSION/CONTINUATION DATE means any date on which, under SECTION
2.4, the Company (a) converts Loans of one Type to another Type or (b)
continues a Borrowing of Offshore Rate Loans having an Interest Period
expiring on such date for a new Interest Period.
CREDIT EXTENSION means and includes (a) the making of any Loan
hereunder, and (b) the Issuance of any Letters of Credit hereunder.
DEBT TO BE REPAID means all Indebtedness of the Company under the
promissory note dated February 1, 1995 issued to Seafirst in the face
principal amount of $20,000,000.
DEFAULT means any event or circumstance which, with the giving of
notice, the lapse of time, or both, would (if
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not cured or otherwise remedied during such time) constitute an Event of
Default.
DOLLARS, DOLLARS and $ each mean lawful money of the United States.
EBITDA means, for any period, the Company's consolidated earnings for
such period before interest income, interest expense, income tax expense,
depreciation and amortization and before any extraordinary gains or losses
and before any gain or loss on the sale or other disposition of any of the
properties listed on SCHEDULE 1.1(c).
EFFECTIVE AMOUNT means (a) with respect to any Revolving Loans,
Swingline Loans and Term Loans on any date, the aggregate outstanding
principal amount thereof after giving effect to any Borrowings and
prepayments or repayments of Revolving Loans, Swingline Loans and Term
Loans occurring on such date; and (b) with respect to any outstanding L/C
Obligations on any date, the amount of such L/C Obligations on such date
after giving effect to any Issuances of Letters of Credit occurring on such
date and any other changes in the aggregate amount of the L/C Obligations
as of such date, including as a result of any reimbursements of outstanding
unpaid drawings under any Letters of Credit or any reductions in the
maximum amount available for drawing under Letters of Credit taking effect
on such date. For purposes of SUBSECTION 2.8(a) the Effective Amount shall
be determined without giving effect to any mandatory prepayments to be made
under SUBSECTION 2.8(b) or 2.8(c).
ELIGIBLE ASSIGNEE means (a) a commercial bank organized under the laws
of the United States, or any state thereof, and having a combined capital
and surplus of at least $100,000,000; (b) a commercial bank organized under
the laws of any other country which is a member of the Organization for
Economic Cooperation and Development (the OECD), or a political subdivision
of any such country, and having a combined capital and surplus of at least
$100,000,000, provided that such bank is acting through a branch or agency
located in the United States; (c) a Person that is primarily engaged in the
business of commercial banking and that is (i) a Subsidiary of a Lender,
(ii) a Subsidiary of a Person of which a Lender is a Subsidiary or (iii) a
Person of which a Lender is a Subsidiary; (d) any Person approved in
writing by the Company, the Issuing Lender, the Swingline Lender and the
Agent; and (e) during the existence of an Event of Default under SUBSECTION
(a), (f) or (g) of SECTION 9.1 or any other Event of Default which has
continued in existence for 90 consecutive days or more, any other Person.
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ENVIRONMENTAL CLAIMS means all claims, however asserted, by any
Governmental Authority or other Person alleging potential liability or
responsibility for violation of any Environmental Law, or for release or
injury to the environment.
ENVIRONMENTAL LAWS means all federal, state or local laws, statutes,
common law duties, rules, regulations, ordinances and codes, together with
all administrative orders, directed duties, requests, licenses,
authorizations and permits of, and agreements with, any Governmental
Authority, in each case relating to environmental and health matters.
ERISA means the Employee Retirement Income Security Act of 1974, and
regulations promulgated thereunder.
ERISA AFFILIATE means any trade or business (whether or not
incorporated) under common control with the Company within the meaning of
Section 414(b) or (c) of the Code (and Sections 414(m) and (o) of the Code
for purposes of provisions relating to Section 412 of the Code).
ERISA EVENT means (a) a Reportable Event with respect to a Pension
Plan; (b) the failure to make a required contribution to a Pension Plan if
such failure is sufficient to give rise to a Lien under Section 302(f) of
ERISA; (c) a withdrawal by the Company or any ERISA Affiliate from a
Pension Plan subject to Section 4063 of ERISA during a plan year in which
it was a substantial employer (as defined in Section 4001(a)(2) of ERISA)
or a cessation of operations which is treated as such a withdrawal under
Section 4062(e) of ERISA; (d) a complete or partial withdrawal by the
Company or any ERISA Affiliate from a Multiemployer Plan or notification
that a Multiemployer Plan is in reorganization; (e) the filing of a notice
of intent to terminate, the treatment of a Plan amendment as a termination
under Section 4041 or 4041A of ERISA, or the commencement of proceedings by
the PBGC to terminate a Pension Plan or Multiemployer Plan; (f) an event or
condition which might reasonably be expected to constitute grounds under
Section 4042 of ERISA for the termination of, or the appointment of a
trustee to administer, any Pension Plan or Multiemployer Plan; or (g) the
imposition of any liability under Title IV of ERISA, other than PBGC
premiums under Section 4007 of ERISA which are due but not delinquent, upon
the Company or any ERISA Affiliate.
EVENT OF DEFAULT means any of the events or circumstances specified in
SECTION 9.1.
EXCHANGE ACT means the Securities and Exchange Act of 1934, and
regulations promulgated thereunder.
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FEDERAL FUNDS RATE means, for any day, the rate set forth in the
weekly statistical release designated as H.15(519), or any successor
publication, published by the Federal Reserve Bank of New York (including
any such successor, "H.15(519)") on the preceding Business Day opposite the
caption "Federal Funds (Effective)"; or, if for any relevant day such rate
is not so published on any such preceding Business Day, the rate for such
day will be the arithmetic mean as determined by the Agent of the rates for
the last transaction in overnight Federal funds arranged prior to 9:00 a.m.
(New York City time) on that day by each of three leading brokers of
Federal funds transactions in New York City selected by the Agent.
FEE LETTER has the meaning specified in SUBSECTION 2.11(a).
FRB means the Board of Governors of the Federal Reserve System, and
any Governmental Authority succeeding to any of its principal functions.
FUNDED DEBT means all Indebtedness of the Company of the type
described in CLAUSES (a), (b), (d), (e) and (f) of the definition of
Indebtedness (including the Loans).
FUNDED DEBT TO EBITDA RATIO means, as of any date, the ratio of (a)
Funded Debt as of such date to (b) EBITDA for the Computation Period most
recently ended on or before such date for which financial statements have
been delivered pursuant to SECTION 7.1; PROVIDED that for purposes of
calculating the Funded Debt to EBITDA Ratio at any time prior to March 23,
1996, EBITDA for the Computation Periods ending June 17, 1995, September 9,
1995 and December 30, 1995 shall be multiplied by fractions equal to 52/12,
52/24 and 52/40, respectively.
GAAP means generally accepted accounting principles set forth from
time to time in the opinions and pronouncements of the Accounting
Principles Board and the American Institute of Certified Public Accountants
and statements and pronouncements of the Financial Accounting Standards
Board (or agencies with similar functions of comparable stature and
authority within the U.S. accounting profession), which are applicable to
the circumstances as of the date of determination.
GOVERNMENTAL AUTHORITY means any nation or government, any state or
other political subdivision thereof, any central bank (or similar monetary
or regulatory authority) thereof, any entity exercising executive,
legislative, judicial, regulatory or administrative functions of or
pertaining to government, and any corporation or other entity owned or
controlled, through stock or capital ownership or otherwise, by any of the
foregoing.
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GUARANTY OBLIGATION has the meaning specified in the definition of
Contingent Obligation.
HONOR DATE has the meaning specified in SUBSECTION 3.3(b).
INDEBTEDNESS of any Person means, without duplication, (a) all
indebtedness for borrowed money; (b) all obligations issued, undertaken or
assumed as the deferred purchase price of property or services; (c) all
non-contingent reimbursement or payment obligations with respect to Surety
Instruments; (d) all obligations evidenced by notes, bonds, debentures or
similar instruments, including obligations so evidenced incurred in
connection with the acquisition of property, assets or businesses; (e) all
indebtedness created or arising under any conditional sale agreement or
other title retention agreement, or incurred as financing, in either case
with respect to property acquired by such Person (even though the rights
and remedies of the seller or lender under such agreement in the event of
default are limited to repossession or sale of such property); (f) all
obligations with respect to capital leases; (g) all net obligations with
respect to Swap Contracts; (h) all indebtedness referred to in CLAUSES (a)
through (g) above secured by (or for which the holder of such Indebtedness
has an existing right, contingent or otherwise, to be secured by) any Lien
upon or in property (including accounts and contract rights) owned by such
Person, even though such Person has not assumed or become liable for the
payment of such Indebtedness; and (i) all Guaranty Obligations in respect
of indebtedness or obligations of others of the kinds referred to in
CLAUSES (a) through (g) above. Notwithstanding the foregoing, Indebtedness
shall not include trade payables entered into in the ordinary course of
business on ordinary terms.
INDEMNIFIED LIABILITIES has the meaning specified in SECTION 11.5.
INDEMNIFIED PERSON has the meaning specified in SECTION 11.5.
INDEPENDENT AUDITOR has the meaning specified in SUBSECTION 7.1(a).
INSOLVENCY PROCEEDING means, with respect to any Person, (a) any case,
action or proceeding with respect to such Person before any court or other
Governmental Authority relating to bankruptcy, reorganization, insolvency,
liquidation, receivership, dissolution, winding-up or relief of debtors, or
(b) any general assignment for the benefit of creditors, composition,
marshalling of assets for creditors, or other, similar arrangement in
respect of such Person's creditors generally or any substantial portion of
its creditors, in each case undertaken under U.S. Federal, state or foreign
law, including the Bankruptcy Code.
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INTEREST PAYMENT DATE means, as to any Loan other than a Base Rate
Loan, the last day of each Interest Period applicable to such Loan and, as
to any Base Rate Loan, the last Business Day of each calendar quarter,
PROVIDED, HOWEVER, that if any Interest Period for an Offshore Rate Loan
exceeds three months, the date that falls three months after the beginning
of such Interest Period and after each Interest Payment Date thereafter is
also an Interest Payment Date.
INTEREST PERIOD means, as to any Offshore Rate Loan, the period
commencing on the Borrowing Date of such Loan or on the
Conversion/Continuation Date on which the Loan is converted into or
continued as an Offshore Rate Loan, and ending on the date one, two, three
or six months thereafter as selected by the Company in its Notice of
Borrowing or Notice of Conversion/Continuation; PROVIDED that:
(i) if any Interest Period would otherwise end on a day that is
not a Business Day, that Interest Period shall be extended to the
following Business Day unless the result of such extension would be to
carry such Interest Period into another calendar month, in which event
such Interest Period shall end on the preceding Business Day;
(ii) any Interest Period that begins on the last Business Day of
a calendar month (or on a day for which there is no numerically
corresponding day in the calendar month at the end of such Interest
Period) shall end on the last Business Day of the calendar month at
the end of such Interest Period;
(iii) no Interest Period for any Revolving Loan shall extend
beyond the Revolving Termination Date;
(iv) no Interest Period applicable to a Term Loan or portion
thereof shall extend beyond any Repayment/Reduction Date unless the
aggregate principal amount of Term Loans represented by Base Rate
Loans, or by Offshore Rate Loans having Interest Periods that will
expire on or before such Repayment/Reduction Date, equals or exceeds
the amount of the scheduled principal payment on such
Repayment/Reduction Date; and
(v) if the initial amount of the Revolving Commitment is more
than $80,000,000, no Interest Period applicable to a Revolving Loan
shall extend beyond any Repayment/Reduction Date unless the aggregate
principal amount of Revolving Loans represented by Base Rate Loans, or
by Offshore Rate Loans having Interest Periods that will expire on or
before such Repayment/Reduction Date, plus the aggregate principal
amount of Swingline Loans and the
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unused portion of the Revolving Commitment, equals the scheduled
reduction of the Revolving Commitment on such Repayment/Reduction
Date.
IRS means the Internal Revenue Service, and any Governmental Authority
succeeding to any of its principal functions under the Code.
ISSUANCE DATE has the meaning specified in SUBSECTION 3.1(a).
ISSUE means, with respect to any Letter of Credit, to issue or to
extend the expiry of, or to renew or increase the amount of, such Letter of
Credit; and the terms ISSUED, ISSUING and ISSUANCE have corresponding
meanings.
ISSUING LENDER means BAI in its capacity as issuer of one or more
Letters of Credit hereunder, together with any replacement letter of credit
issuer arising under SUBSECTION 10.1(b) or SECTION 10.9.
JOINT VENTURE means a single-purpose corporation, partnership, limited
liability company, joint venture or other similar legal arrangement
(whether created by contract or conducted through a separate legal entity)
now or hereafter formed by the Company or any of its Subsidiaries with
another Person in order to conduct a common venture or enterprise with such
Person.
L/C ADVANCE means each Lender's participation in any L/C Borrowing in
accordance with its Pro Rata Share.
L/C AMENDMENT APPLICATION means an application form for amendment of
outstanding standby or commercial documentary letters of credit as shall at
any time be in use at the Issuing Lender, as the Issuing Lender shall
reasonably request.
L/C APPLICATION means an application form for issuances of standby or
commercial documentary letters of credit as shall at any time be in use at
the Issuing Lender, as the Issuing Lender shall reasonably request.
L/C BORROWING means an extension of credit resulting from a drawing
under any Letter of Credit which shall not have been reimbursed on the date
when made nor converted into a Borrowing of Revolving Loans under
SUBSECTION 3.3(b).
L/C COMMITMENT means the commitment of the Issuing Lender to Issue,
and the commitment of the Lenders severally to participate in, Letters of
Credit from time to time Issued or outstanding under ARTICLE III, in an
aggregate amount not to exceed on any date the lesser of (a) the amount of
the Revolving Commitment and (b) $10,000,000, IT BEING UNDERSTOOD that the
L/C Commitment is a part of the
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Revolving Commitment rather than a separate, independent commitment.
L/C OBLIGATIONS means at any time the sum of (a) the aggregate undrawn
amount of all Letters of Credit then outstanding, plus (b) the amount of
all unreimbursed drawings under all Letters of Credit, including all
outstanding L/C Borrowings.
L/C-RELATED DOCUMENTS means the Letters of Credit, the L/C
Applications, the L/C Amendment Applications and any other document
relating to any Letter of Credit, including any of the Issuing Lender's
standard form documents for letter of credit issuances.
LENDER has the meaning specified in the introductory clause hereto.
References to the "Lenders" shall include BAI in its capacity as Issuing
Lender and Seafirst in its capacity as Swingline Lender; for purposes of
clarification only, to the extent that BAI or Seafirst may have any rights
or obligations in addition to those of the Lenders due to its status as
Issuing Lender or Swingline Lender, respectively, its status as such will
be specifically referenced.
LENDING OFFICE means, as to any Lender, the office or offices of such
Lender specified as its "Lending Office" or "Domestic Lending Office" or
"Offshore Lending Office", as the case may be, on SCHEDULE 11.2, or such
other office or offices as such Lender may from time to time notify the
Company and the Agent.
LETTERS OF CREDIT means any letters of credit Issued by the Issuing
Lender pursuant to ARTICLE III.
LIEN means any security interest, mortgage, deed of trust, pledge,
hypothecation, assignment, charge or deposit arrangement, encumbrance, lien
(statutory or other) in respect of any property (including those created
by, arising under or evidenced by any conditional sale or other title
retention agreement, the interest of a lessor under a capital lease, or the
filing of any financing statement naming the owner of the asset to which
such lien relates as debtor, under the Uniform Commercial Code or any
comparable law), but not including the interest of a lessor under an
operating lease.
LOAN means an extension of credit by a Lender to the Company under
ARTICLE II or ARTICLE III in the form of a Revolving Loan, Term Loan,
Swingline Loan or L/C Advance.
LOAN DOCUMENTS means this Agreement, any Notes, the Fee Letter, the
L/C-Related Documents, the Security Agreement and the Trademark Security
Agreement.
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MAJORITY LENDERS means at any time at least three Lenders then holding
in excess of 50% of the then aggregate unpaid principal amount of the
Loans, or, if no such principal amount is then outstanding, at least three
Lenders then having in excess of 50% of the Commitments.
MARGIN STOCK means "margin stock" as such term is defined in
Regulation G, T, U or X of the FRB.
MATERIAL ADVERSE EFFECT means (a) a material adverse change in, or a
material adverse effect upon, the actual or prospective operations,
business, properties or condition (financial or otherwise) of the Company
or the Company and its Subsidiaries taken as a whole; or (b) a material
adverse effect upon the legality, validity, binding effect or
enforceability against the Company of any Loan Document.
MULTIEMPLOYER PLAN means a "multiemployer plan", within the meaning of
Section 4001(a)(3) of ERISA, with respect to which the Company or any ERISA
Affiliate may have any liability.
NET CASH PROCEEDS means the cash proceeds (including any cash payments
received by way of deferred payment of principal pursuant to a note or
installment receivable or purchase price adjustment or otherwise, but only
as and when received) of any Asset Sale, net of all attorney's fees,
accountants' fees, investment banking fees, survey costs, title insurance
premiums, required debt payments (other than pursuant to this Agreement)
and other fees and charges in connection therewith.
NET INCOME means, for any period, the Company's consolidated net
earnings for such period.
NOTE means a promissory note executed by the Company in favor of a
Lender pursuant to SUBSECTION 2.2(b), in substantially the form of EXHIBIT
G.
NOTICE OF BORROWING means a notice in substantially the form of
EXHIBIT A.
NOTICE OF CONVERSION/CONTINUATION means a notice in substantially the
form of EXHIBIT B.
OBLIGATIONS means all debts, liabilities, obligations, covenants and
duties arising under any Loan Document owing by the Company to any Lender,
the Agent, or any Indemnified Person, whether direct or indirect (including
those acquired by assignment), absolute or contingent, due or to become
due, or now existing or hereafter arising.
OFFSHORE RATE means, for any Interest Period, with respect to Offshore
Rate Loans comprising part of the same Borrowing, the rate of interest per
annum (rounded upward
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(unless such rate is an integral multiple of 1/16 or 1/100 of 1%) to the
next 1/100th of 1%) determined by the Agent as follows:
Offshore Rate = IBOR
------------------------------------
1.00 - Eurodollar Reserve Percentage
Where,
"EURODOLLAR RESERVE PERCENTAGE" means for any day for any Interest
Period the maximum reserve percentage (expressed as a decimal) in
effect on such day (whether or not applicable to any Lender) under
regulations issued from time to time by the FRB for determining the
maximum reserve requirement (including any emergency, supplemental or
other marginal reserve requirement) with respect to Eurocurrency
funding (currently referred to as "Eurocurrency liabilities"); and
"IBOR" means the rate of interest per annum determined by the Agent as
the rate at which dollar deposits in the approximate amount of the
Offshore Rate Loan of BAI for such Interest Period would be offered by
BofA's Grand Cayman Branch, Grand Cayman B.W.I. (or such other office
as may be designated for such purpose by BofA), to major banks in the
offshore dollar interbank market at their request at approximately
11:00 a.m. (New York City time) two Business Days prior to the
commencement of such Interest Period.
The Offshore Rate shall be adjusted automatically as to all Offshore
Rate Loans then outstanding as of the effective date of any change in the
Eurodollar Reserve Percentage.
OFFSHORE RATE LOAN means a Loan that bears interest based on the
Offshore Rate.
OLSON'S FOODS means Olson's Food Stores, Inc., a Washington
corporation.
ORGANIZATION DOCUMENTS means, for any corporation, the certificate or
articles of incorporation, the bylaws, any certificate of determination or
instrument relating to the rights of preferred shareholders of such
corporation, any shareholder rights agreement, and all applicable
resolutions of the board of directors (or any committee thereof) of such
corporation.
OTHER TAXES means any present or future stamp or documentary taxes or
any other excise or property taxes, charges or similar levies which arise
from any payment made hereunder or from the execution, delivery or
registration
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of, or otherwise with respect to, this Agreement or any other Loan
Document.
PARTICIPANT has the meaning specified in SUBSECTION 11.8(c).
PBGC means the Pension Benefit Guaranty Corporation, or any
Governmental Authority succeeding to any of its principal functions under
ERISA.
PENSION PLAN means a pension plan (as defined in Section 3(2) of
ERISA) subject to Title IV of ERISA with respect to which the Company may
have any liability.
PERMITTED LIENS has the meaning specified in SECTION 8.1.
PERSON means an individual, partnership, corporation, limited
liability company, business trust, joint stock company, trust,
unincorporated association, joint venture or Governmental Authority.
PLAN means an employee benefit plan (as defined in Section 3(3) of
ERISA) which the Company sponsors or maintains or to which the Company
makes, is making, or is obligated to make contributions, and includes any
Pension Plan.
PRO RATA SHARE means, as to any Lender at any time, the percentage
(rounded to the ninth decimal place) at such time of such Lender's
Commitment divided by the combined Commitments of all Lenders. The initial
Pro Rata Share of each Lender is set forth on SCHEDULE 1.1(b).
RECAPITALIZATION AGREEMENT means the Recapitalization and Stock
Purchase and Sale Agreement dated as of January 14, 1995 among Z/C, the
Company and Stuart Sloan.
REPAYMENT/REDUCTION DATE has the meaning specified in SUBSECTION
2.9(a).
REPLACEMENT LENDER has the meaning specified in SECTION 4.7.
REPORTABLE EVENT means, any of the events set forth in Section 4043(b)
of ERISA or the regulations thereunder, other than any such event for which
the 30-day notice requirement under ERISA has been waived in regulations
issued by the PBGC.
REQUIREMENT OF LAW means, as to any Person, any law (statutory or
common), treaty, rule or regulation or determination of an arbitrator or of
a Governmental Authority, in each case applicable to or binding upon the
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Person or any of its property or to which the Person or any of its property
is subject.
RESPONSIBLE OFFICER means the chief executive officer or the president
of the Company, or any other officer having substantially the same
authority and responsibility; or, with respect to compliance with financial
covenants, the chief financial officer or the treasurer of the Company, or
any other officer having substantially the same authority and
responsibility.
REVOLVING COMMITMENT means the amount set forth under the heading
"Revolving Commitment" on SCHEDULE 2.1 opposite the applicable number of
Shares purchased by the Company pursuant to the Tender Offer, as reduced
from time to time pursuant to this Agreement.
REVOLVING LOAN has the meaning specified in SECTION 2.1.
REVOLVING TERMINATION DATE means the earlier to occur of:
(a) September 8, 2001; and
(b) the date on which the Commitments terminate in accordance
with the provisions of this Agreement.
SALE-LEASEBACK means any transaction pursuant to which the Company or
any Subsidiary sells or otherwise disposes of any property with the
intention of retaining the use thereof under a lease or other comparable
arrangement.
SEAFIRST means Seattle First National Bank, a national banking
association.
SEC means the Securities and Exchange Commission, or any Governmental
Authority succeeding to any of its principal functions.
SECURITY AGREEMENT has the meaning specified in SUBSECTION 5.1(g).
SHARES means the Company's common stock, $.001 par value per share.
SPECIFIED NET PROCEEDS means any Net Cash Proceeds received by the
Company or any Subsidiary to the extent such Net Cash Proceeds, together
with all other Net Cash Proceeds received by the Company and its
Subsidiaries since the Closing Date, exceed 10% of the Company's
consolidated assets as of the last day of the most recently-completed
fiscal year of the Company.
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STANDSTILL AGREEMENT means the Standstill Agreement dated as of
January 14, 1995 between the Company and Z/C, as in effect on the date
hereof.
SUBSIDIARY of a Person means any corporation, association,
partnership, limited liability company, joint venture or other business
entity of which more than 50% of the voting stock, membership interests or
other equity interests (in the case of Persons other than corporations), is
owned or controlled directly or indirectly by such Person, or one or more
of the other Subsidiaries of the Person, or a combination thereof. Unless
the context otherwise clearly requires, references herein to a "Subsidiary"
refer to a Subsidiary of the Company.
SUPPLEMENTAL REVOLVER AMOUNT means the amount, if any, by which the
initial amount of the Revolving Commitment exceeds $80,000,000.
SURETY INSTRUMENT means any letter of credit (including standby and
commercial), banker's acceptance, bank guaranty, surety bond or similar
instrument.
SWAP CONTRACT means any agreement (including any master agreement and
any agreement, whether or not in writing, relating to any single
transaction) that is an interest rate swap agreement, basis swap, forward
rate agreement, commodity swap, commodity option, equity or equity index
swap or option, bond option, interest rate option, forward foreign exchange
agreement, rate cap, collar or floor agreement, currency swap agreement,
cross-currency rate swap agreement, swaption, currency option or any other,
similar agreement (including any option to enter into any of the
foregoing).
SWINGLINE LOAN has the meaning specified in SUBSECTION 2.5(a).
TAXES means any and all present or future taxes, levies, imposts,
deductions, charges or withholdings, and all liabilities with respect
thereto, excluding, in the case of each Lender and the Agent, such taxes
(including income taxes or franchise taxes) as are imposed on such Lender
or the Agent as a result of a present, former or future connection between
the jurisdiction of the government or taxing authority imposing such tax or
any political subdivision or taxing authority thereof or therein and such
Lender or the Agent (other than a connection arising solely from such
Lender or the Agent having executed, delivered or performed its obligations
or received a payment under, or enforced, this Agreement).
TENDER OFFER means the tender offer pursuant to which the Company
offered to purchase up to 7,000,000 Shares for
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$25 per Share on the terms and conditions described in the Offer to
Purchase dated January 19, 1995.
TERM COMMITMENT means the amount set forth under the heading "Term
Commitment" on SCHEDULE 2.1 opposite the applicable number of Shares
purchased by the Company pursuant to the Tender Offer, as reduced from time
to time pursuant to the terms of this Agreement.
TERM LOAN has the meaning specified in SECTION 2.1.
TRADEMARK SECURITY AGREEMENT has the meaning specified in SUBSECTION
5.1(g).
TYPE of Loan means the characterization of a Loan as a Base Rate Loan
or an Offshore Rate Loan.
UNFUNDED PENSION LIABILITY means the excess of a Pension Plan's
benefit liabilities under Section 4001(a)(16) of ERISA as of the end of the
most recent plan year over the value of such Plan's assets as of such date,
determined in accordance with the assumptions that would be used in a
termination of such Plan for the applicable plan year.
UNITED STATES and U.S. each means the United States of America.
WHOLLY-OWNED SUBSIDIARY means any corporation in which (other than
directors' qualifying shares required by law) 100% of the capital stock of
each class having ordinary voting power, and 100% of the capital stock of
every other class, in each case, at the time as of which any determination
is being made, is owned, beneficially and of record, by the Company, or by
one or more of the other Wholly-Owned Subsidiaries, or both.
Z/C means Zell/Chilmark Fund L.P.
1.2 OTHER INTERPRETIVE PROVISIONS.
(a) The meanings of defined terms are equally applicable to the
singular and plural forms of the defined terms.
(b) The words "hereof", "herein", "hereunder" and similar words refer
to this Agreement as a whole and not to any particular provision of this
Agreement; and SUBSECTION, SECTION, SCHEDULE and EXHIBIT references are to this
Agreement unless otherwise specified.
(c) (i) The term "documents" includes any and all instruments,
documents, agreements, certificates, indentures, notices and other
writings, however evidenced.
(ii) The term "including" is not limiting and means "including
without limitation."
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(iii) In the computation of periods of time from a specified
date to a later specified date, the word "from" means "from and including";
the words "to" and "until" each mean "to but excluding", and the word
"through" means "to and including."
(d) Unless otherwise expressly provided herein, (i) references to
agreements (including this Agreement) and other contractual instruments shall be
deemed to include all subsequent amendments and other modifications thereto, but
only to the extent such amendments and other modifications are not prohibited by
the terms of any Loan Document, and (ii) references to any statute or regulation
are to be construed as including all statutory and regulatory provisions
consolidating, amending, replacing, supplementing or interpreting the statute or
regulation.
(e) The captions and headings of this Agreement are for convenience
of reference only and shall not affect the interpretation of this Agreement.
(f) This Agreement and other Loan Documents may use several different
limitations, tests or measurements to regulate the same or similar matters. All
such limitations, tests and measurements are cumulative and shall each be
performed in accordance with their terms.
(g) This Agreement and the other Loan Documents are the result of
negotiations among and have been reviewed by counsel to the Agent, the Company
and the other parties, and are the products of all parties. Accordingly, they
shall not be construed against the Lenders or the Agent merely because of the
Agent's or Lenders' involvement in their preparation.
1.3 ACCOUNTING PRINCIPLES.
(a) Unless the context otherwise clearly requires, all accounting
terms not expressly defined herein shall be construed, and all financial
computations required under this Agreement shall be made, in accordance with
GAAP, consistently applied; PROVIDED that if the Company notifies the Agent that
the Company wishes to amend any covenant in ARTICLE VIII to eliminate the effect
of any change in GAAP on the operation of such covenant (or if the Agent
notifies the Company that the Majority Lenders wish to amend ARTICLE VIII for
such purpose), then the Company's compliance with such covenant shall be
determined on the basis of GAAP in effect immediately before the relevant change
in GAAP became effective, until either such notice is withdrawn or such covenant
is amended in a manner satisfactory to the Company and the Majority Lenders.
(b) References herein to "fiscal year" and "fiscal quarter" refer to
such fiscal periods of the Company.
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ARTICLE II
THE CREDITS
2.1 AMOUNTS AND TERMS OF COMMITMENTS. (a) THE TERM CREDIT. Each Lender
severally agrees, on the terms and conditions set forth herein, to make a single
loan to the Company (each such loan, a "TERM LOAN") on the Closing Date in an
amount not to exceed such Lender's Pro Rata Share of the Term Commitment.
Amounts borrowed as Term Loans which are repaid or prepaid by the Company may
not be reborrowed.
(b) THE REVOLVING CREDIT. Each Lender severally agrees, on the terms
and conditions set forth herein, to make loans to the Company (each such loan, a
"REVOLVING LOAN") from time to time on any Business Day during the period from
the Closing Date to the Revolving Termination Date, in an aggregate amount not
to exceed at any time outstanding such Lender's Pro Rata Share of the Revolving
Commitment; PROVIDED that, after giving effect to any Borrowing of Revolving
Loans, the Effective Amount of all outstanding Revolving Loans plus the
Effective Amount of all outstanding Swingline Loans and all L/C Obligations
shall not exceed the Revolving Commitment; AND PROVIDED, FURTHER, that the
Effective Amount of all outstanding Revolving Loans and Term Loans of any Lender
plus such Lender's Pro Rata Share of the Effective Amount of all outstanding
Swingline Loans and all L/C Obligations shall not at any time exceed such
Lender's Commitment. Within the foregoing limits, and subject to the other
terms and conditions hereof, the Company may borrow under this SUBSECTION
2.1(b), prepay under SECTION 2.7 and reborrow under this SUBSECTION 2.1(b).
2.2 LOAN ACCOUNTS. (a) Each Lender (including the Swingline Lender),
with respect to amounts payable to it hereunder, the Issuing Lender, with
respect to all Letters of Credit and L/C Obligations, and the Agent, with
respect to all amounts payable hereunder, shall maintain on its books, in
accordance with its usual practice, loan accounts or other records setting forth
each applicable Loan or Letter of Credit hereunder. The accounts or records
maintained by each Lender, the Issuing Lender and the Agent shall be PRIMA FACIE
evidence as to the amount of the Loans made by the Lenders to the Company and
the Letters of Credit Issued for the account of the Company, and the interest
and payments thereon. Any failure so to record or any error in doing so shall
not, however, limit or otherwise affect the obligation of the Company hereunder
to pay any amount owing with respect to any Loan or any Letter of Credit.
(b) Upon the request of any Lender made through the Agent, the Loans
made by such Lender may be evidenced by one or more Notes, instead of loan
accounts. Each such Lender shall endorse on the schedules annexed to its
Note(s) the date and amount of each Loan made by it and the amount of each
payment of principal made by the Company with respect thereto. Each such Lender
is irrevocably authorized by the Company to endorse its
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Note(s) and each Lender's record shall be PRIMA FACIE evidence of the amount of
the Loans evidenced thereby; PROVIDED, HOWEVER, that the failure of a Lender to
make, or an error in making, a notation thereon with respect to any Loan shall
not limit or otherwise affect the obligations of the Company hereunder or under
any such Note to such Lender.
2.3 PROCEDURE FOR BORROWING OF TERM LOANS AND REVOLVING LOANS. (a) Each
Borrowing of Revolving Loans or Term Loans shall be made upon the Company's
irrevocable written notice delivered to the Agent in the form of a Notice of
Borrowing, which notice must be received by the Agent prior to 9:00 a.m. (San
Francisco time) (i) three Business Days prior to the requested Borrowing Date,
in the case of Offshore Rate Loans, and (ii) one Business Day prior to the
requested Borrowing Date, in the case of Base Rate Loans, specifying:
(A) the amount of the Borrowing, which shall be in the
amount of $5,000,000 or a higher integral multiple of $500,000;
(B) the requested Borrowing Date, which shall be a Business
Day;
(C) the Type of Loans comprising the Borrowing; and
(D) the duration of the Interest Period applicable to any
Offshore Rate Loans included in such notice. If the Notice of
Borrowing fails to specify the duration of the Interest Period for any
Borrowing comprised of Offshore Rate Loans, such Interest Period shall
be one month.
(b) The Agent will promptly notify each Lender of its receipt of any
Notice of Borrowing and of the amount of such Lender's Pro Rata Share of that
Borrowing.
(c) Each Lender will make the amount of its Pro Rata Share of each
Borrowing available to the Agent for the account of the Company at the Agent's
Payment Office by 11:00 a.m. (San Francisco time) on the Borrowing Date
requested by the Company in funds immediately available to the Agent. The
proceeds of all such Loans will then be made available to the Company by the
Agent by wire transfer in accordance with written instructions provided to the
Agent by the Company of like funds as received by the Agent.
(d) After giving effect to any Borrowing, there may not be more than
10 different Interest Periods in effect.
2.4 CONVERSION AND CONTINUATION ELECTIONS. (a) The Company may, upon
irrevocable written notice to the Agent in accordance with SUBSECTION 2.4(b):
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(i) elect to convert on any Business Day, any Base Rate Loans
(or any part thereof in an amount not less than $5,000,000 or a higher
integral multiple of $500,000) into Offshore Rate Loans; or
(ii) elect to convert on the last day of the applicable Interest
Period any Offshore Rate Loans maturing on such day (or any part thereof in
an amount not less than $5,000,000 or a higher integral multiple of
$500,000) into Base Rate Loans; or
(iii) elect to renew on the last day of the applicable Interest
Period any Offshore Rate Loans maturing on such day (or any part thereof in
an amount not less than $5,000,000 or a higher integral multiple of
$500,000);
PROVIDED, that if the aggregate amount of Offshore Rate Loans in respect of any
Borrowing shall have been reduced, by payment, prepayment or conversion of part
thereof to be less than $5,000,000, such Offshore Rate Loans shall automatically
convert into Base Rate Loans.
(b) The Company shall deliver a Notice of Conversion/Continuation to
be received by the Agent not later than 9:00 a.m. (San Francisco time) at least
(i) three Business Days in advance of the Conversion/Continuation Date, if the
Loans are to be converted into or continued as Offshore Rate Loans; and (ii) one
Business Day in advance of the Conversion/Continuation Date, if the Loans are to
be converted into Base Rate Loans, specifying:
(A) the proposed Conversion/Continuation Date;
(B) the aggregate amount of Loans to be converted or
renewed;
(C) the Type of Loans resulting from the proposed
conversion or continuation; and
(D) other than in the case of conversions into Base Rate
Loans, the duration of the requested Interest Period.
(c) If upon the expiration of any Interest Period applicable to
Offshore Rate Loans, the Company has failed to select timely a new Interest
Period to be applicable to such Offshore Rate Loans, or if any Default or Event
of Default then exists (and the Majority Lenders have not otherwise agreed
pursuant to SUBSECTION 2.4(e)), the Company shall be deemed to have elected to
convert such Offshore Rate Loans into Base Rate Loans effective as of the
expiration date of such Interest Period.
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(d) The Agent will promptly notify each Lender of its receipt of a
Notice of Conversion/Continuation or, if no timely notice is provided by the
Company, the Agent will promptly notify each Lender of the details of any
automatic conversion. All conversions and continuations shall be made ratably
according to the respective outstanding principal amounts of the Loans with
respect to which the notice was given held by each Lender.
(e) Unless the Majority Lenders otherwise agree, during the existence
of any Default or Event of Default, the Company may not elect to have a Loan
converted into or continued as an Offshore Rate Loan.
(f) After giving effect to any conversion or continuation of Loans,
there may not be more than 10 different Interest Periods in effect.
2.5 SWINGLINE LOANS.
(a) Subject to the terms and conditions hereof, the Swingline Lender
may, in its sole discretion (subject to SUBSECTION 2.5(b)), make a portion of
the Revolving Commitment available to the Company by making swingline loans
(each such loan, a "SWINGLINE LOAN") to the Company on any Business Day during
the period from the Closing Date to the Revolving Termination Date in accordance
with the procedures set forth in this SECTION 2.5 in an aggregate principal
amount at any one time outstanding not to exceed the lesser of (x) the amount of
the Revolving Commitment and (y) $10,000,000, notwithstanding the fact that such
Swingline Loans, when aggregated with the Swingline Lender's outstanding
Revolving Loans, may exceed the Swingline Lender's Pro Rata Share of the
Revolving Commitment; PROVIDED that at no time shall the sum of the Effective
Amount of all Swingline Loans, Revolving Loans and L/C Obligations exceed the
amount of the Revolving Commitment. Subject to the other terms and conditions
hereof, the Company may borrow under this SUBSECTION 2.5(a), prepay pursuant to
SUBSECTION 2.5(d) and reborrow pursuant to this SUBSECTION 2.5(a) from time to
time; PROVIDED that the Swingline Lender shall not be obligated to make any
Swingline Loan.
(b) The Company shall provide the Agent and the Swingline Lender
irrevocable written notice (including notice via facsimile confirmed promptly by
a telephone call) of any Swingline Loan requested hereunder (which notice must
be received by the Swingline Lender and the Agent prior to 1:00 p.m. (San
Francisco time) on the requested Borrowing Date) specifying (i) the amount to be
borrowed, and (ii) the requested Borrowing Date, which must be a Business Day.
Upon receipt of such notice, the Swingline Lender will promptly confirm with the
Agent (by telephone or in writing) that the Agent has received a copy of such
notice from the Company and, if not, the Swingline Lender will provide the Agent
with a copy thereof. Unless the Swingline Lender has received notice prior to
2:00 p.m. (San Francisco time) on the proposed Borrowing Date from the Agent
(including at
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the request of any Lender) (A) directing the Swingline Lender not to make the
requested Swingline Loan as a result of the limitations set forth in the PROVISO
set forth in the first sentence of SUBSECTION 2.5(a) or (B) that one or more
conditions specified in ARTICLE V is not then satisfied, THEN, subject to the
terms and conditions hereof, the Swingline Lender may make the amount of the
requested Swingline Loan available to the Company by crediting the account of
the Company on the books of Seafirst with the amount of such Swingline Loan.
Each Swingline Loan shall be in an aggregate principal amount equal to $500,000
or a higher integral multiple of $100,000. The Swingline Lender will promptly
notify the Agent of the amount of each Swingline Loan.
(c) Principal of and accrued interest on each Swingline Loan shall be
due and payable (i) on demand made by the Swingline Lender at any time upon one
Business Day's prior notice to the Company furnished at or before 8:45 a.m. (San
Francisco time), and (ii) in any event on the Revolving Termination Date.
Interest on Swingline Loans shall be for the sole account of the Swingline
Lender (except to the extent that the other Lenders have funded the purchase of
participations therein pursuant to SUBSECTION 2.5(e)).
(d) The Company may, from time to time on any Business Day, make a
voluntary prepayment, in whole or in part, of the outstanding principal amount
of any Swingline Loan, without incurring any premium or penalty; PROVIDED that
(i) each such voluntary prepayment shall require prior written
notice given to the Agent and the Swingline Lender no later than 1:00
p.m. (San Francisco time) on the day on which the Company intends to
make a voluntary prepayment, and
(ii) each such voluntary prepayment shall be in an amount equal
to $500,000 or a higher integral multiple of $100,000 (or, if less,
the aggregate outstanding principal amount of all Swingline Loans then
outstanding).
Voluntary prepayments of Swingline Loans shall be made by the Company to
the Swingline Lender at such office as the Swingline Lender may designate by
notice to the Company from time to time. All such payments shall be made in
dollars and in immediately available funds no later than 2:00 p.m. (San
Francisco time) on the date specified by the Company pursuant to CLAUSE (i)
above (and any payment received later than such time shall be deemed to have
been received on the next Business Day). The Swingline Lender will promptly
notify the Agent of the amount of each prepayment of Swingline Loans.
(e) If (i) any Swingline Loan shall remain outstanding at 9:00 a.m.
(San Francisco time) on the Business Day immediately prior to a Business Day on
which Swingline Loans are
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due and payable pursuant to SUBSECTION 2.5(c) and by such time on such Business
Day the Agent shall have received neither (A) a Notice of Borrowing delivered
pursuant to SECTION 2.3 requesting that Revolving Loans be made pursuant to
SUBSECTION 2.1(b) on such following Business Day in an amount at least equal to
the aggregate principal amount of such Swingline Loans, nor (B) any other notice
indicating the Company's intent to repay such Swingline Loans with funds
obtained from other sources, or (ii) any Swingline Loans shall remain
outstanding during the existence of a Default or Event of Default and the
Swingline Lender shall in its sole discretion notify the Agent that the
Swingline Lender desires that such Swingline Loans be converted into Revolving
Loans, THEN the Agent shall be deemed to have received a Notice of Borrowing
from the Company pursuant to SECTION 2.3 requesting that Base Rate Loans be made
pursuant to SUBSECTION 2.1(b) on the following Business Day in an amount equal
to the aggregate amount of such Swingline Loans, and the procedures set forth in
SUBSECTIONS 2.3(b) and 2.3(c) shall be followed in making such Base Rate Loans;
PROVIDED that such Base Rate Loans shall be made notwithstanding the Company's
failure to comply with SECTION 5.2; and PROVIDED, FURTHER, that if a Borrowing
of Revolving Loans becomes legally impractical and if so required by the
Swingline Lender at the time such Revolving Loans are required to be made by the
Lenders in accordance with this SUBSECTION 2.5(e), each Lender agrees that in
lieu of making Revolving Loans as described in this SUBSECTION 2.5(e), such
Lender shall purchase a participation from the Swingline Lender in the
applicable Swingline Loans in an amount equal to such Lender's Pro Rata Share of
such Swingline Loans, and the procedures set forth in SUBSECTIONS 2.3(b) and
2.3(c) shall be followed in connection with the purchases of such
participations. The proceeds of such Base Rate Loans (or participations
purchased) shall be delivered by the Agent to the Swingline Lender to repay such
Swingline Loans (or as payment for such participations). A copy of each notice
given by the Agent to the Lenders pursuant to this SUBSECTION 2.5(e) with
respect to the making of Loans, or the purchases of participations, shall be
promptly delivered by the Agent to the Company. Each Lender's obligation in
accordance with this Agreement to make the Revolving Loans, or purchase the
participations, as contemplated by this SUBSECTION 2.5(e), shall be absolute and
unconditional and shall not be affected by any circumstance, including (1) any
set-off, counterclaim, recoupment, defense or other right which such Lender may
have against the Swingline Lender, the Company or any other Person for any
reason whatsoever; (2) the occurrence or continuance of a Default, an Event of
Default or a Material Adverse Effect; or (3) any other circumstance, happening
or event whatsoever, whether or not similar to any of the foregoing.
2.6 VOLUNTARY TERMINATION OR REDUCTION OF COMMITMENTS. The Company may,
upon not less than five Business Days' prior notice to the Agent, terminate the
Commitments, or permanently reduce the amount of the Revolving Commitment or the
Term Commitment by an aggregate amount of $5,000,000 or a higher integral
multiple of $1,000,000, UNLESS, in the case of the
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Revolving Commitment, after giving effect thereto and to any prepayments of
Loans made on the effective date thereof, the Effective Amount of all Revolving
Loans, Swingline Loans and L/C Obligations together would exceed the amount of
the Revolving Commitment then in effect. Once reduced in accordance with this
Section, neither the Revolving Commitment nor the Term Commitment may be
increased. Any reduction of the Revolving Commitment or the Term Commitment
shall ratably reduce the Commitment of each Lender according to its Pro Rata
Share.
2.7 OPTIONAL PREPAYMENTS OF REVOLVING LOANS AND TERM LOANS. Subject to
SECTION 4.4, the Company may, at any time or from time to time, upon not less
than three Business Days' irrevocable notice to the Agent in the case of
Offshore Rate Loans and not less than one Business Day's irrevocable notice to
the Agent in the case of Base Rate Loans, ratably prepay any Borrowing of
Revolving Loans or Term Loans in whole or in part, in an aggregate amount of
$5,000,000 or a higher integral multiple of $500,000. Such notice of prepayment
shall specify the date and amount of such prepayment and the Loans to be
prepaid. The Agent will promptly notify each Lender of its receipt of any such
notice, and of such Lender's Pro Rata Share of such prepayment. If any such
notice is given by the Company, the payment amount specified in such notice
shall be due and payable on the date specified therein, together with accrued
interest to the date of such prepayment on the amount prepaid and any amount
required pursuant to SECTION 4.4. Optional prepayments of Term Loans shall be
applied pro rata to the remaining installments thereof.
2.8 MANDATORY CREDIT REDUCTIONS.
(a) EXCESS OUTSTANDINGS. If on any date the Effective Amount of L/C
Obligations exceeds the L/C Commitment, the Company shall Cash Collateralize on
such date the outstanding Letters of Credit in an amount equal to the excess of
the L/C Obligations over the L/C Commitment. Subject to SECTION 4.4, if on any
date after giving effect to any Cash Collateralization made on such date
pursuant to the preceding sentence, the Effective Amount of all Revolving Loans,
Swingline Loans and L/C Obligations exceeds the Revolving Commitment, the
Company shall immediately, and without notice or demand, prepay the outstanding
principal amount of the Revolving Loans, Swingline Loans and/or L/C Advances by
an amount equal to such excess.
(b) ASSET SALES. Within ten Business Days after any date on which
the aggregate amount of all Specified Net Proceeds not previously applied
pursuant to this SUBSECTION 2.8(b) exceeds $1,000,000, (i) if any Term Loans are
outstanding, the Company shall make a prepayment of the Term Loans in an amount
equal to such Specified Net Proceeds (any such prepayment to be applied pro rata
to the remaining installments of the Term Loans); and (ii) if no Term Loans are
outstanding AND the initial amount of the Revolving Commitment was more than
$80,000,000, the Revolving Commitment shall permanently be reduced by an amount
equal to
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such Specified Net Proceeds (any such reduction to be applied pro rata to reduce
the remaining scheduled reductions of the Revolving Commitment set forth in the
second sentence of SUBSECTION 2.9(b)); PROVIDED that the aggregate amount of all
reductions of the Revolving Commitment pursuant to the foregoing CLAUSE (ii)
shall not exceed the Supplemental Revolver Amount.
(c) REVOLVING COMMITMENT REDUCTIONS. If on any date on which the
Revolving Commitment is reduced pursuant to SUBSECTION 2.8(b) or 2.9(b) the
Effective Amount of all Revolving Loans, Swingline Loans and L/C Obligations
exceeds the Revolving Commitment (as so reduced), the Company shall immediately,
and without notice or demand, prepay the outstanding principal amount of the
Revolving Loans, Swingline Loans and/or L/C Advances by an amount equal to such
excess.
2.9 REPAYMENT. (a) THE TERM CREDIT. The Company shall repay the Term
Loans on each of the dates set forth in SCHEDULE 2.9 (each a
"REPAYMENT/REDUCTION DATE") in an amount equal to the percentage of the original
principal amount of all Term Loans set forth opposite such date on SCHEDULE 2.9.
(b) THE REVOLVING CREDIT. The Company shall repay to the Lenders on
the Revolving Termination Date the aggregate principal amount of all Revolving
Loans outstanding on such date. In addition, if the initial amount of the
Revolving Commitment is more than $80,000,000, then the amount of the Revolving
Commitment shall be reduced on each Repayment/Reduction Date in an amount equal
to the percentage of the Supplemental Revolver Amount set forth opposite such
date on SCHEDULE 2.9.
2.10 INTEREST. (a) Each Revolving Loan and Term Loan shall bear interest
on the outstanding principal amount thereof from the applicable Borrowing Date
at a rate per annum equal to the Offshore Rate or the Base Rate, as the case may
be (and subject to the Company's right to convert to other Types of Loans under
SECTION 2.4), PLUS the Applicable Margin. Each Swingline Loan shall bear
interest on the outstanding principal amount thereof from the applicable
Borrowing Date at a rate per annum equal to the Base Rate.
(b) Interest on each Loan shall be paid in arrears on each Interest
Payment Date. Interest shall also be paid on the date of any prepayment of Term
Loans under SECTION 2.7, 2.8 or 2.9 for the portion of the Term Loans so prepaid
and upon payment (including prepayment) in full thereof.
(c) Notwithstanding SUBSECTION (a) of this Section, after the
occurrence of any Default under SUBSECTION (a) or (g) of SECTION 9.1 or any
Event of Default under SUBSECTION (a), (f) or (g) of SECTION 9.1 and, at the
election of the Majority Lenders, after the occurrence of any other Event of
Default, and so long as such Default or Event of Default exists, the Company
will pay interest (after as well as before judgment thereon to the extent
permitted by applicable law) on the principal amount
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of all outstanding Loans and, to the extent permitted by applicable law, on any
other amount payable hereunder or under any other Loan Document, at a rate per
annum equal to the rate otherwise applicable thereto pursuant to the terms
hereof or such other Loan Document (or, if no such rate is specified, the Base
Rate) plus 2%. All such interest shall be payable on demand.
(d) Anything herein to the contrary notwithstanding, the obligations
of the Company to any Lender hereunder shall be subject to the limitation that
payments of interest shall not be required for any period for which interest is
computed hereunder to the extent (but only to the extent) that contracting for
or receiving such payment by such Lender would be contrary to the provisions of
any law applicable to such Lender limiting the highest rate of interest that may
be lawfully contracted for, charged or received by such Lender, and in such
event the Company shall pay such Lender interest at the highest rate permitted
by applicable law.
2.11 FEES. In addition to certain fees described in SECTION 3.8:
(a) ARRANGEMENT, AGENCY FEES. The Company shall pay an arrangement
fee to the Arranger for the Arranger's own account, and shall pay an agency fee
to the Agent for the Agent's own account, as required by the letter agreement
(the "FEE LETTER") between the Company and the Arranger and the Agent dated
January 19, 1995.
(b) UP-FRONT FEE. The Company shall pay to the Agent for the account
of each Lender on the Closing Date an up-front fee of 0.375% of the amount of
such Lender's allocated Commitment (after any reduction based upon the amounts
of the Revolving Commitment and the Term Commitment as determined on the Closing
Date).
(c) COMMITMENT FEES. The Company shall pay to the Agent for the
account of each Lender a commitment fee at the Commitment Fee Rate on the
average daily unused portion of such Lender's Commitment, computed on a
quarterly basis in arrears on the last Business Day of each calendar quarter
based upon the daily utilization for that quarter as calculated by the Agent.
For purposes of calculating utilization under this subsection, the Commitments
shall be deemed used to the extent of the Effective Amount of Revolving Loans,
Term Loans and L/C Obligations then outstanding (but Swingline Loans shall not
constitute usage of any Lender's Commitment). Such commitment fee shall accrue
from March 3, 1995 to the Closing Date based upon the maximum amount of the
Commitment of each Lender (as set forth on SCHEDULE 1.1(b)) and from the Closing
Date to the Revolving Termination Date on the actual unused Commitment of each
Lender as in effect from time to time. Such fee shall be due and payable on the
date of the initial Loans and thereafter quarterly in arrears on the last
Business Day of each calendar quarter through the Revolving Termination Date,
with the final
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payment to be made on the Revolving Termination Date. The commitment fees
provided in this subsection shall accrue at all times after the above-mentioned
commencement date, including at any time during which one or more conditions in
ARTICLE V are not met.
2.12 COMPUTATION OF FEES AND INTEREST. (a) All computations of interest
for Base Rate Loans when the Base Rate is determined by BofA's "reference rate"
shall be made on the basis of a year of 365 or 366 days, as the case may be, and
actual days elapsed. All other computations of fees and interest shall be made
on the basis of a 360-day year and actual days elapsed (which results in more
interest being paid than if computed on the basis of a 365-day year). Interest
and fees shall accrue during each period during which interest or fees are
computed from the first day thereof to the last day thereof.
(b) Each determination of an interest rate by the Agent shall be
conclusive and binding on the Company and the Lenders in the absence of manifest
error. The Agent will, at the request of the Company or any Lender, deliver to
the Company or such Lender a statement showing the quotations used by the Agent
in determining any interest rate and the resulting interest rate.
2.13 PAYMENTS BY THE COMPANY. (a) All payments to be made by the Company
shall be made without set-off, recoupment or counterclaim. Except as otherwise
expressly provided herein, all payments by the Company shall be made to the
Agent for the account of the Lenders at the Agent's Payment Office, and shall be
made in dollars and in immediately available funds, no later than 10:00 a.m.
(San Francisco time) on the date specified herein. The Agent will promptly
distribute to each Lender its Pro Rata Share (or other applicable share as
expressly provided herein) of such payment in like funds as received. Any
payment received by the Agent later than 10:00 a.m. (San Francisco time) shall
be deemed to have been received on the following Business Day and any applicable
interest or fee shall continue to accrue.
(b) Whenever any payment is due on a day other than a Business Day,
such payment shall be made on the following Business Day (unless, in the case of
interest on an Offshore Rate Loan, such following Business Day is the first
Business Day of a calendar month, in which case such payment shall be made on
the preceding Business Day), and such extension of time shall in such case be
included in the computation of interest or fees, as the case may be.
(c) Unless the Agent receives notice from the Company prior to the
date on which any payment is due to the Lenders that the Company will not make
such payment in full as and when required, the Agent may assume that the Company
has made such payment in full to the Agent on such date in immediately available
funds, and the Agent may (but shall not be so required), in reliance upon such
assumption, distribute to each Lender on such due date an amount equal to the
amount then due
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such Lender. If and to the extent the Company has not made such payment in full
to the Agent, each Lender shall repay to the Agent on demand such amount
distributed to such Lender, together with interest thereon at the Federal Funds
Rate for each day from the date such amount is distributed to such Lender until
the date repaid.
2.14 PAYMENTS BY THE LENDERS TO THE AGENT. (a) Unless the Agent receives
notice from a Lender on or prior to the Closing Date or, with respect to any
Borrowing after the Closing Date, at not later than 3:00 p.m. (San Francisco
time) on the Business Day preceding the date of such Borrowing, that such Lender
will not make available as and when required hereunder to the Agent for the
account of the Company the amount of that Lender's Pro Rata Share of such
Borrowing, the Agent may assume that each Lender has made such amount available
to the Agent in immediately available funds on the Borrowing Date, and the Agent
may (but shall not be so required), in reliance upon such assumption, make
available to the Company on such date a corresponding amount. If and to the
extent any Lender shall not have made its full amount available to the Agent in
immediately available funds and the Agent in such circumstances has made
available to the Company such amount, that Lender shall on the Business Day
following such Borrowing Date make such amount available to the Agent, together
with interest at the Federal Funds Rate for each day during such period. A
notice of the Agent submitted to any Lender with respect to amounts owing under
this SUBSECTION (a) shall be conclusive, absent manifest error. If such amount
is so made available, such payment to the Agent shall constitute such Lender's
Loan on the date of Borrowing for all purposes of this Agreement. If such
amount is not made available to the Agent on the Business Day following the
Borrowing Date, the Agent will notify the Company of such failure to fund and,
upon demand by the Agent, the Company shall pay such amount to the Agent for the
Agent's account, together with interest thereon for each day elapsed since the
date of such Borrowing, at a rate per annum equal to the interest rate
applicable at the time to the Loans comprising such Borrowing.
(b) The failure of any Lender to make any Loan on any Borrowing Date
shall not relieve any other Lender of any obligation hereunder to make a Loan on
such Borrowing Date, but no Lender shall be responsible for the failure of any
other Lender to make the Loan to be made by such other Lender on any Borrowing
Date.
2.15 SHARING OF PAYMENTS, ETC. If, other than as expressly provided
elsewhere herein, any Lender shall obtain on account of the Loans made by it any
payment (whether voluntary, involuntary, through the exercise of any right of
set-off, or otherwise) in excess of its Pro Rata Share, such Lender shall
immediately (a) notify the Agent of such fact, and (b) purchase from the other
Lenders such participations in the Loans made by them as shall be necessary to
cause such purchasing Lender to share the excess payment pro rata with each of
them; PROVIDED, HOWEVER, that if
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all or any portion of such excess payment is thereafter recovered from the
purchasing Lender, such purchase shall to that extent be rescinded and each
other Lender shall repay to the purchasing Lender the purchase price paid
therefor, together with an amount equal to such paying Lender's ratable share
(according to the proportion of (i) the amount of such paying Lender's required
repayment to (ii) the total amount so recovered from the purchasing Lender) of
any interest or other amount paid or payable by the purchasing Lender in respect
of the total amount so recovered. The Company agrees that any Lender so
purchasing a participation from another Lender may, to the fullest extent
permitted by law, exercise all its rights of payment (including the right of
set-off, but subject to SECTION 11.10) with respect to such participation as
fully as if such Lender were the direct creditor of the Company in the amount of
such participation. The Agent will keep records (which shall be conclusive and
binding in the absence of manifest error) of participations purchased under this
Section and will in each case notify the Lenders following any such purchases or
repayments.
ARTICLE III
THE LETTERS OF CREDIT
3.1 THE LETTER OF CREDIT SUBFACILITY. (a) On the terms and conditions
set forth herein (i) the Issuing Lender agrees, (A) from time to time on any
Business Day during the period from the Closing Date to the Revolving
Termination Date to issue Letters of Credit for the account of the Company, and
to amend or renew Letters of Credit previously issued by it, in accordance with
SUBSECTIONS 3.2(c) and 3.2(d), and (B) to honor drafts under the Letters of
Credit; and (ii) the Lenders severally agree to participate in Letters of Credit
Issued for the account of the Company; PROVIDED, that the Issuing Lender shall
not be obligated to Issue, and no Lender shall be obligated to participate in,
any Letter of Credit if as of the date of Issuance of such Letter of Credit (the
"ISSUANCE DATE") (1) the Effective Amount of all L/C Obligations plus the
Effective Amount of all Revolving Loans and Swingline Loans exceeds the amount
of the Revolving Commitment or (2) the Effective Amount of all L/C Obligations
exceeds the L/C Commitment. Within the foregoing limits, and subject to the
other terms and conditions hereof, the Company's ability to obtain Letters of
Credit shall be fully revolving, and, accordingly, the Company may, during the
foregoing period, obtain Letters of Credit to replace Letters of Credit which
have expired or which have been drawn upon and reimbursed.
(b) The Issuing Lender is under no obligation to Issue any Letter of
Credit if:
(i) any order, judgment or decree of any Governmental Authority
or arbitrator shall by its terms purport to enjoin or restrain the Issuing
Lender from Issuing such Letter of Credit, or any Requirement of Law
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applicable to the Issuing Lender or any request or directive (whether or
not having the force of law) from any Governmental Authority with
jurisdiction over the Issuing Lender shall prohibit, or request that the
Issuing Lender refrain from, the Issuance of letters of credit generally or
such Letter of Credit in particular or shall impose upon the Issuing Lender
with respect to such Letter of Credit any restriction, reserve or capital
requirement (for which the Issuing Lender is not otherwise compensated
hereunder) not in effect on the Closing Date, or shall impose upon the
Issuing Lender any unreimbursed loss, cost or expense which was not
applicable on the Closing Date and which the Issuing Lender in good faith
deems material to it;
(ii) the Issuing Lender has received written notice from any
Lender, the Agent or the Company, on or prior to the Business Day prior to
the requested date of Issuance of such Letter of Credit, that one or more
of the applicable conditions contained in ARTICLE V is not then satisfied;
(iii) the expiry date of any requested Letter of Credit is (A)
more than 365 days after the date of Issuance, unless the Majority Lenders
have approved such expiry date in writing, or (B) after the Revolving
Termination Date, unless all of the Lenders have approved such expiry date
in writing;
(iv) any requested Letter of Credit does not provide for drafts,
or is not otherwise in form and substance acceptable to the Issuing Lender,
or the Issuance of a Letter of Credit shall violate any applicable policies
of the Issuing Lender; or
(v) such Letter of Credit is denominated in a currency other
than Dollars.
3.2 ISSUANCE, AMENDMENT AND RENEWAL OF LETTERS OF CREDIT. (a) Each
Letter of Credit shall be issued upon the irrevocable written request of the
Company received by the Issuing Lender (with a copy sent by the Company to the
Agent) at least four days (or such shorter time as the Issuing Lender may agree
in a particular instance in its sole discretion) prior to the proposed date of
issuance. Each such request for issuance of a Letter of Credit shall be by
facsimile, confirmed promptly in an original writing, in the form of an L/C
Application, and shall specify in form and detail satisfactory to the Issuing
Lender: (i) the proposed date of issuance of the Letter of Credit (which shall
be a Business Day); (ii) the face amount of the Letter of Credit; (iii) the
expiry date of the Letter of Credit; (iv) the name and address of the
beneficiary thereof; (v) the documents to be presented by the beneficiary of the
Letter of Credit in case of any drawing thereunder; (vi) the full text of any
certificate to be presented by the beneficiary in case of any drawing
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thereunder; and (vii) such other matters as the Issuing Lender may reasonably
require.
(b) At least two Business Days prior to the Issuance of any Letter of
Credit, the Issuing Lender will confirm with the Agent (by telephone or in
writing) that the Agent has received a copy of the L/C Application or L/C
Amendment Application from the Company and, if not, the Issuing Lender will
provide the Agent with a copy thereof. Unless the Issuing Lender has received,
on or before the Business Day immediately preceding the date the Issuing Lender
is to issue a requested Letter of Credit, (A) notice from the Agent directing
the Issuing Lender not to issue such Letter of Credit because such issuance is
not then permitted under SUBSECTION 3.1(a) as a result of the limitations set
forth in CLAUSE (1) or (2) thereof or (B) a notice described in SUBSECTION
3.1(b)(ii), then, subject to the terms and conditions hereof, the Issuing Lender
shall, on the requested date, issue a Letter of Credit for the account of the
Company in accordance with the Issuing Lender's usual and customary business
practices.
(c) From time to time while a Letter of Credit is outstanding and
prior to the Revolving Termination Date, the Issuing Lender will, upon the
written request of the Company received by the Issuing Lender (with a copy sent
by the Company to the Agent) at least four days (or such shorter time as the
Issuing Lender may agree in a particular instance in its sole discretion) prior
to the proposed date of amendment, amend any Letter of Credit issued by it.
Each such request for amendment of a Letter of Credit shall be made by
facsimile, confirmed immediately in an original writing, made in the form of an
L/C Amendment Application and shall specify in form and detail satisfactory to
the Issuing Lender: (i) the Letter of Credit to be amended; (ii) the proposed
date of amendment of the Letter of Credit (which shall be a Business Day); (iii)
the nature of the proposed amendment; and (iv) such other matters as the Issuing
Lender may require. The Issuing Lender shall be under no obligation to amend
any Letter of Credit if: (A) the Issuing Lender would have no obligation at
such time to issue such Letter of Credit in its amended form under the terms of
this Agreement; or (B) the beneficiary of any such letter of Credit does not
accept the proposed amendment to the Letter of Credit. The Agent will promptly
notify the Lenders of the receipt by it of any L/C Application or L/C Amendment
Application.
(d) The Issuing Lender and the Lenders agree that, while a Letter of
Credit is outstanding and prior to the Revolving Termination Date, at the option
of the Company and upon the written request of the Company received by the
Issuing Lender (with a copy sent by the Company to the Agent) at least four days
(or such shorter time as the Issuing Lender may agree in a particular instance
in its sole discretion) prior to the proposed date of notification of renewal,
the Issuing Lender shall be entitled to authorize the automatic renewal of any
Letter of Credit issued by it. Each such request for renewal of a Letter of
Credit shall be made by facsimile, confirmed promptly in an
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original writing, in the form of an L/C Amendment Application, and shall specify
in form and detail satisfactory to the Issuing Lender: (i) the Letter of Credit
to be renewed; (ii) the proposed date of notification of renewal of the Letter
of Credit (which shall be a Business Day); (iii) the revised expiry date of the
Letter of Credit; and (iv) such other matters as the Issuing Lender may require.
The Issuing Lender shall be under no obligation so to renew any Letter of Credit
if: (A) the Issuing Lender would have no obligation at such time to issue or
amend such Letter of Credit in its renewed form under the terms of this
Agreement; or (B) the beneficiary of any such Letter of Credit does not accept
the proposed renewal of the Letter of Credit. If any outstanding Letter of
Credit shall provide that it shall be automatically renewed unless the
beneficiary thereof receives notice from the Issuing Lender that such Letter of
Credit shall not be renewed, and if at the time of renewal the Issuing Lender
would be entitled to authorize the automatic renewal of such Letter of Credit in
accordance with this SUBSECTION 3.2(e) upon the request of the Company but the
Issuing Lender shall not have received any L/C Amendment Application from the
Company with respect to such renewal or other written direction by the Company
with respect thereto, the Issuing Lender shall nonetheless be permitted to allow
such Letter of Credit to renew, and the Company and the Lenders hereby authorize
such renewal, and, accordingly, the Issuing Lender shall be deemed to have
received an L/C Amendment Application from the Company requesting such renewal.
(e) The Issuing Lender may, at its election (or as required by the
Agent at the direction of the Majority Lenders), deliver any notices of
termination or other communications to any Letter of Credit beneficiary or
transferee, and take any other action as necessary or appropriate, at any time
and from time to time, in order to cause the expiry date of such Letter of
Credit to be a date not later than the Revolving Termination Date.
(f) This Agreement shall control in the event of any conflict with
any L/C-Related Document (other than any Letter of Credit).
(g) The Issuing Lender will also deliver to the Agent (which, if so
requested by any Lender, will promptly deliver a copy thereof to such Lender),
concurrently or promptly following its delivery of a Letter of Credit, or
amendment to or renewal of a Letter of Credit, to an advising bank or a
beneficiary, a true and complete copy of each such Letter of Credit or amendment
to or renewal of a Letter of Credit.
3.3 RISK PARTICIPATIONS, DRAWINGS AND REIMBURSEMENTS. (a) Immediately
upon the Issuance of each Letter of Credit, each Lender shall be deemed to, and
hereby irrevocably and unconditionally agrees to, purchase from the Issuing
Lender a participation in such Letter of Credit and each drawing thereunder in
an amount equal to the product of (i) the Pro Rata Share of such Lender times
(ii) the maximum amount available to
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be drawn under such Letter of Credit and the amount of such drawing,
respectively.
(b) In the event of any request for a drawing under a Letter of
Credit by the beneficiary or transferee thereof, the Issuing Lender will
promptly notify the Company. The Company shall reimburse the Issuing Lender
prior to 10:00 a.m. (San Francisco time), on each date that any amount is paid
by the Issuing Lender under any Letter of Credit (each such date, an "HONOR
DATE"), in an amount equal to the amount so paid by the Issuing Lender. In the
event the Company fails to reimburse the Issuing Lender for the full amount of
any drawing under any Letter of Credit by 10:00 a.m. (San Francisco time) on the
Honor Date, the Issuing Lender will promptly notify the Agent and the Agent will
promptly notify each Lender thereof, and the Company shall be deemed to have
requested that Base Rate Loans be made by the Lenders to be disbursed on the
Honor Date under such Letter of Credit, subject to the amount of the unutilized
portion of the Revolving Commitment and subject to the conditions set forth in
SECTION 5.2. Any notice given by the Issuing Lender or the Agent pursuant to
this SUBSECTION 3.3(b) may be oral if immediately confirmed in writing
(including by facsimile); provided that the lack of such an immediate
confirmation shall not affect the conclusiveness or binding effect of such
notice.
(c) Each Lender shall upon any notice pursuant to SUBSECTION 3.3(b)
make available to the Agent for the account of the Issuing Lender an amount in
Dollars and in immediately available funds equal to its Pro Rata Share of the
amount of the drawing, whereupon the participating Lenders shall (subject to
SUBSECTION 3.3(d)) each be deemed to have made a Revolving Loan consisting of a
Base Rate Loan to the Company in that amount. If any Lender so notified fails
to make available to the Agent for the account of the Issuing Lender the amount
of such Lender's Pro Rata Share of the amount of the drawing by no later than
12:00 noon (San Francisco time) on the Honor Date, then interest shall accrue on
such Lender's obligation to make such payment, from the Honor Date to the date
such Lender makes such payment, at a rate per annum equal to the Federal Funds
Rate in effect from time to time during such period. The Agent will promptly
give notice of the occurrence of the Honor Date, but failure of the Agent to
give any such notice on the Honor Date or in sufficient time to enable any
Lender to effect such payment on such date shall not relieve such Lender from
its obligations under this SECTION 3.3 (provided that no Lender shall be
obligated to pay interest pursuant to the immediately preceding sentence in
respect of any date prior to the date it receives such notice from the Agent).
(d) With respect to any unreimbursed drawing that is not converted
into Revolving Loans consisting of Base Rate Loans to the Company in whole or in
part, because of the Company's failure to satisfy the conditions set forth in
SECTION 5.2 or for any other reason, the Company shall be deemed to have
incurred from the Issuing Lender an L/C Borrowing in the amount of such drawing,
which L/C Borrowing shall be due and payable on demand
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(together with interest) and shall bear interest at a rate per annum equal to
the Base Rate plus 2% per annum, and each Lender's payment to the Issuing Lender
pursuant to SUBSECTION 3.3(c) shall be deemed payment in respect of its
participation in such L/C Borrowing and shall constitute an L/C Advance from
such Lender in satisfaction of its participation obligation under this SECTION
3.3.
(e) Each Lender's obligation in accordance with this Agreement to
make Revolving Loans or L/C Advances, as contemplated by this SECTION 3.3, as a
result of a drawing under a Letter of Credit, shall be absolute and
unconditional and without recourse to the Issuing Lender and shall not be
affected by any circumstance, including (i) any set-off, counterclaim,
recoupment, defense or other right which such Lender may have against the
Issuing Lender, the Company or any other Person for any reason whatsoever; (ii)
the occurrence or continuance of a Default, an Event of Default or a Material
Adverse Effect; or (iii) any other circumstance, happening or event whatsoever,
whether or not similar to any of the foregoing; PROVIDED, however, that each
Lender's obligation to make Revolving Loans under this SECTION 3.3 is subject to
the conditions set forth in SECTION 5.2.
3.4 REPAYMENT OF PARTICIPATIONS. (a) Upon (and only upon) receipt by the
Agent for the account of the Issuing Lender of immediately available funds from
the Company (i) in reimbursement of any payment made by the Issuing Lender under
the Letter of Credit with respect to which any Lender has paid the Agent for the
account of the Issuing Lender for such Lender's participation in the Letter of
Credit pursuant to SECTION 3.3 or (ii) in payment of interest thereon, the Agent
will pay to each Lender, in the same funds as those received by the Agent for
the account of the Issuing Lender, the amount of such Lender's Pro Rata Share of
such funds, and the Issuing Lender shall receive the amount of the Pro Rata
Share of such funds of any Lender that did not so pay the Agent for the account
of the Issuing Lender.
(b) If the Agent or the Issuing Lender is required at any time to
return to the Company, or to a trustee, receiver, liquidator, custodian, or any
official in any Insolvency Proceeding, any portion of the payments made by the
Company to the Agent for the account of the Issuing Lender pursuant to
SUBSECTION 3.4(a) in reimbursement of a payment made under any Letter of Credit
or interest or fee thereon, each Lender shall, on demand of the Agent, forthwith
return to the Agent or the Issuing Lender the amount of its Pro Rata Share of
any amounts so returned by the Agent or the Issuing Lender plus interest thereon
from the date such demand is made to the date such amounts are returned by such
Lender to the Agent or the Issuing Lender, at a rate per annum equal to the
Federal Funds Rate in effect from time to time.
3.5 ROLE OF THE ISSUING LENDER. (a) Each Lender and the Company agree
that, in paying any drawing under a Letter of
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Credit, the Issuing Lender shall not have any responsibility to obtain any
document (other than any sight draft and certificates expressly required by the
Letter of Credit) or to ascertain or inquire as to the validity or accuracy of
any such document or the authority of the Person executing or delivering any
such document.
(b) No Agent-Related Person nor any of the respective correspondents,
participants or assignees of the Issuing Lender shall be liable to any Lender
for: (i) any action taken or omitted in connection herewith at the request or
with the approval of the Lenders (including the Majority Lenders, as
applicable); (ii) any action taken or omitted in the absence of gross negligence
or willful misconduct; or (iii) the due execution, effectiveness, validity or
enforceability of any L/C-Related Document.
(c) The Company hereby assumes all risks of the acts or omissions of
any beneficiary or transferee with respect to its use of any Letter of Credit;
PROVIDED that this assumption is not intended to, and shall not, preclude the
Company's pursuing such rights and remedies as it may have against the
beneficiary or transferee at law or under any other agreement. No Agent-Related
Person, nor any of the respective correspondents, participants or assignees of
the Issuing Lender, shall be liable or responsible for any of the matters
described in CLAUSES (i) through (vii) of SECTION 3.6; PROVIDED that, anything
in such clauses to the contrary notwithstanding, the Company may have a claim
against the Issuing Lender, and the Issuing Lender may be liable to the Company,
to the extent, but only to the extent, of any direct, as opposed to
consequential or exemplary, damages suffered by the Company which the Company
proves were caused by the Issuing Lender's willful misconduct or gross
negligence or the Issuing Lender's willful failure to pay under any Letter of
Credit after the presentation to it by the beneficiary of a sight draft and
certificate(s) strictly complying with the terms and conditions of a Letter of
Credit. In furtherance and not in limitation of the foregoing: (i) the Issuing
Lender may accept documents that appear on their face to be in order, without
responsibility for further investigation, regardless of any notice or
information to the contrary; and (ii) the Issuing Lender shall not be
responsible for the validity or sufficiency of any instrument transferring or
assigning or purporting to transfer or assign a Letter of Credit or the rights
or benefits thereunder or proceeds thereof, in whole or in part, which may prove
to be invalid or ineffective for any reason.
3.6 OBLIGATIONS ABSOLUTE. The obligations of the Company under this
Agreement and any L/C-Related Document to reimburse the Issuing Lender for a
drawing under a Letter of Credit, and to repay any L/C Borrowing and any drawing
under a Letter of Credit converted into Revolving Loans, shall be unconditional
and irrevocable, and shall be paid strictly in accordance with the terms of this
Agreement and each such other L/C-Related Document under all circumstances,
including the following:
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(i) any lack of validity or enforceability of this Agreement or
any L/C-Related Document;
(ii) any change in the time, manner or place of payment of, or
in any other term of, all or any of the obligations of the Company in
respect of any Letter of Credit or any other amendment or waiver of or any
consent to departure from all or any of the L/C-Related Documents;
(iii) the existence of any claim, set-off, defense or other
right that the Company may have at any time against any beneficiary or any
transferee of any Letter of Credit (or any Person for whom any such
beneficiary or any such transferee may be acting), the Issuing Lender or
any other Person, whether in connection with this Agreement, the
transactions contemplated hereby or by the L/C-Related Documents or any
unrelated transaction;
(iv) any draft, demand, certificate or other document presented
under any Letter of Credit proving to be forged, fraudulent, invalid or
insufficient in any respect or any statement therein being untrue or
inaccurate in any respect; or any loss or delay in the transmission or
otherwise of any document required in order to make a drawing under any
Letter of Credit;
(v) any payment by the Issuing Lender under any Letter of Credit
against presentation of a draft or certificate that does not strictly
comply with the terms of any Letter of Credit; or any payment made by the
Issuing Lender under any Letter of Credit to any Person purporting to be a
trustee in bankruptcy, debtor-in-possession, assignee for the benefit of
creditors, liquidator, receiver or other representative of or successor to
any beneficiary or any transferee of any Letter of Credit, including any
arising in connection with any Insolvency Proceeding;
(vi) any exchange, release or non-perfection of any collateral,
or any release or amendment or waiver of or consent to departure from any
other guarantee, for all or any of the obligations of the Company in
respect of any Letter of Credit; or
(vii) any other circumstance or happening whatsoever, whether or
not similar to any of the foregoing, including any other circumstance that
might otherwise constitute a defense available to, or a discharge of, the
Company or a guarantor.
3.7 CASH COLLATERAL PLEDGE. If (i) any Letters of Credit remain
outstanding and partially or wholly undrawn as of the Revolving Termination Date
or (ii) the Company is required to Cash Collateralize Letters of Credit pursuant
to SUBSECTION 2.8(a), then the Company shall immediately Cash Collateralize the
L/C Obligations in an amount equal to (a) in the case of CLAUSE
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(i) above, the maximum amount then available to be drawn under all Letters of
Credit and (b) in the case of CLAUSE (ii) above, the amount required pursuant to
SUBSECTION 2.8(a).
3.8 LETTER OF CREDIT FEES. (a) The Company shall pay to the Agent for
the account of each of the Lenders a letter of credit fee with respect to the
Letters of Credit at a percentage rate per annum equal to the Applicable Margin
for Offshore Rate Loans (as in effect from time to time) of the average daily
maximum amount available to be drawn of the outstanding Letters of Credit,
computed on a quarterly basis in arrears on the last Business Day of each
calendar quarter and on the Revolving Termination Date (or such later date on
which the outstanding Letters of Credit shall expire) based upon Letters of
Credit outstanding for the applicable period as calculated by the Agent.
(b) The Company shall pay to the Issuing Lender a letter of credit
fronting fee for each Letter of Credit Issued by the Issuing Lender equal to
0.25% per annum of the average daily maximum amount available to be drawn of the
outstanding Letters of Credit, computed on the last Business Day of each
calendar quarter and on the Revolving Termination Date (or such later date on
which the outstanding Letters of Credit shall expire) based upon Letters of
Credit outstanding for the applicable period as calculated by the Agent.
(c) The letter of credit fees payable under SUBSECTION 3.8(a) and the
fronting fees payable under SUBSECTION 3.8(b) shall be due and payable quarterly
in arrears on the last Business Day of each calendar quarter during which
Letters of Credit are outstanding, commencing on the first such quarterly date
to occur after the Closing Date, through the Revolving Termination Date (or such
later date upon which the outstanding Letters of Credit shall expire), with the
final payment to be made on the Revolving Termination Date (or such later
expiration date).
(d) The Company shall pay to the Issuing Lender from time to time on
demand the normal issuance, presentation, amendment and other processing fees,
and other standard costs and charges, of the Issuing Lender relating to letters
of credit as from time to time in effect.
3.9 UNIFORM CUSTOMS AND PRACTICE. The Uniform Customs and Practice for
Documentary Credits as published by the International Chamber of Commerce most
recently at the time of issuance of any Letter of Credit shall (unless otherwise
expressly provided in the Letters of Credit) apply to the Letters of Credit.
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ARTICLE IV
TAXES, YIELD PROTECTION AND ILLEGALITY
4.1 TAXES. (a) Any and all payments by the Company to each Lender or the
Agent under this Agreement and any other Loan Document shall be made free and
clear of, and without deduction or withholding for, any Taxes. In addition, the
Company shall pay all Other Taxes.
(b) The Company agrees to indemnify and hold harmless each Lender and
the Agent for the full amount of Taxes or Other Taxes (including any Taxes or
Other Taxes imposed by any jurisdiction on amounts payable under this Section)
paid by the Lender or the Agent and any penalty, interest, addition to tax or
expense arising therefrom or with respect thereto, whether or not such Taxes or
Other Taxes were correctly or legally asserted. Payment under this
indemnification shall be made within 30 days after the date the Lender or the
Agent makes written demand therefor.
(c) If the Company shall be required by law to deduct or withhold any
Taxes or Other Taxes from or in respect of any sum payable hereunder to any
Lender or the Agent, then:
(i) the sum payable shall be increased as necessary so that
after making all required deductions and withholdings (including deductions
and withholdings applicable to additional sums payable under this Section)
such Lender or the Agent, as the case may be, receives an amount equal to
the sum it would have received had no such deductions or withholdings been
made;
(ii) the Company shall make such deductions and withholdings;
and
(iii) the Company shall pay the full amount deducted or withheld
to the relevant taxing authority or other authority in accordance with
applicable law.
(d) Within 30 days after the date of any payment by the Company of
Taxes or Other Taxes, the Company shall furnish the Agent the original or a copy
of a receipt evidencing payment thereof, or other evidence of payment
satisfactory to the Agent.
(e) The Company shall not be required to pay an additional amount to,
or indemnify, any Lender or the Agent pursuant to this SECTION 4.1 to the extent
that (i) the obligation to withhold or pay such amount existed on the Initial
Date (as hereinafter defined) or (ii) the obligation to withhold or pay such
amount would not have arisen but for the failure of the Agent or such Lender to
comply with the provisions of SECTION 10.10 of this Agreement. For purposes of
this SECTION 4.1(e), "Initial Date" shall mean (a) in the case of the Agent and
any Lender that is a signatory hereto, the date of this Agreement,
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(b) in the case of any Person which subsequently becomes a Lender hereunder, the
date of the applicable Assignment and Acceptance, and (c) in the case of any
Participant, the date on which it becomes a Participant.
(f) If the Company is required to pay additional amounts to any
Lender or the Agent pursuant to SUBSECTION (c) of this Section, then such Lender
shall use reasonable efforts (consistent with legal and regulatory restrictions)
to change the jurisdiction of its Lending Office or take other appropriate
action so as to eliminate any such additional payment by the Company which may
thereafter accrue, if such change or other action in the judgment of such Lender
is not otherwise disadvantageous to such Lender.
(g) If the Company determines in good faith that a reasonable basis
exists for contesting a Tax, the relevant Lender or the Agent, as applicable,
shall cooperate with the Company in challenging such Tax at the Company's
expense if requested by the Company. If any Lender or the Agent, as applicable,
receives a refund of a Tax for which a payment has been made by the Company
pursuant to this Agreement, or claims any credit, relief or other tax benefit as
a result of the payment of such Tax by the Company (a "Tax Credit"), which
refund or Tax Credit in the good faith judgment of such Lender or Agent, as the
case may be, is attributable to such payment made by the Company, then such
Lender or the Agent, as applicable, shall reimburse to the Company such amount
as such Lender or the Agent, as applicable, determines to be the proportion of
the Tax Credit or refund as will leave it, after such reimbursement, in no
better or worse position than it would have been in if the payment had not been
required. The Agent and each Lender shall claim any refund or Tax Credit that
it determines is available to it, unless it concludes in its good faith judgment
that it would be adversely affected by making such a claim. In no event shall
the Agent or any Lender be obliged to disclose any information regarding its tax
affairs or computations to the Company.
4.2 ILLEGALITY. (a) If any Lender determines that the introduction of
any Requirement of Law, or any change in any Requirement of Law, or in the
interpretation or administration of any Requirement of Law, has made it
unlawful, or that any central bank or other Governmental Authority has asserted
that it is unlawful, for such Lender or its applicable Lending Office to make
Offshore Rate Loans, then, on notice thereof by the Lender to the Company
through the Agent, any obligation of that Lender to make Offshore Rate Loans
shall be suspended until the Lender notifies the Agent and the Company that the
circumstances giving rise to such determination no longer exist.
(b) If a Lender determines that the introduction of any Requirement
of Law, or any change in any Requirement of Law, or in the interpretation or
administration of any Requirement of Law, has made it unlawful, or that any
central bank or other Governmental Authority has asserted that it is unlawful
for such
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Lender or its applicable Lending Office to maintain any Offshore Rate Loan, the
Company shall, upon its receipt of notice of such fact and demand from such
Lender (with a copy to the Agent), prepay in full such Offshore Rate Loan,
together with interest accrued thereon and amounts required under SECTION 4.4,
either on the last day of the Interest Period thereof, if the Lender may
lawfully continue to maintain such Offshore Rate Loan to such day, or
immediately, if the Lender may not lawfully continue to maintain such Offshore
Rate Loan. If the Company is required to so prepay any Offshore Rate Loan, then
concurrently with such prepayment, the Company shall borrow from the affected
Lender, in the amount of such repayment, a Base Rate Loan.
(c) If the obligation of any Lender to make or maintain Offshore Rate
Loans has been so terminated or suspended, the Company may elect, by giving
notice to the Lender through the Agent, that all Loans which would otherwise be
made by such Lender as Offshore Rate Loans shall be instead Base Rate Loans.
(d) Before giving any notice or demand to the Agent under this
Section, the affected Lender shall designate a different Lending Office with
respect to its Offshore Rate Loans or take other appropriate action if such
designation or other action will avoid the need for giving such notice or making
such demand and will not, in the judgment of such Lender, be illegal or
otherwise disadvantageous to such Lender.
4.3 INCREASED COSTS AND REDUCTION OF RETURN. (a) If any Lender
determines that, due to either (i) the introduction of or any change (other than
(x) any change by way of imposition of or increase in reserve requirements
included in the calculation of the Offshore Rate, (y) any introduction or change
covered by SECTION 4.1 or (z) any change with respect to a tax imposed on any
Lender or the Agent as a result of a present, former or future connection
between the jurisdiction of the government or taxing authority imposing such tax
or any political subdivision or taxing authority thereof or therein and such
Lender or the Agent (other than a connection arising solely from such Lender or
the Agent having executed, delivered or performed its obligations or received a
payment under, or enforced, this Agreement)) in or in the interpretation of any
law or regulation or (ii) the compliance by such Lender with any guideline or
request from any central bank or other Governmental Authority (whether or not
having the force of law), there shall be any increase in the cost to such Lender
of agreeing to make or making, funding or maintaining any Offshore Rate Loan or
participating in Letters of Credit, or, in the case of the Issuing Lender, any
increase in the cost to the Issuing Lender of agreeing to issue, issuing or
maintaining any Letter of Credit or of agreeing to make or making, funding or
maintaining any unpaid drawing under any Letter of Credit, then the Company
shall be liable for, and shall from time to time, upon demand (with a copy of
such demand to be sent to the Agent), pay to the Agent for the account of such
Lender, additional amounts as are sufficient to compensate such Lender for such
increased costs.
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(b) If any Lender shall have determined that (i) the introduction of
any Capital Adequacy Regulation, (ii) any change in any Capital Adequacy
Regulation, or (iii) any change in the interpretation or administration of any
Capital Adequacy Regulation by any central bank or other Governmental Authority
charged with the interpretation or administration thereof, affects or would
affect the amount of capital required or expected to be maintained by such
Lender or any corporation controlling such Lender and (taking into consideration
such Lender's or such corporation's policies with respect to capital adequacy)
determines that the amount of such capital is increased as a consequence of its
Commitment, loans, credits or obligations under this Agreement, then, upon
demand of such Lender to the Company through the Agent, the Company shall pay to
such Lender, from time to time as specified by such Lender, additional amounts
sufficient to compensate such Lender for such increase.
4.4 FUNDING LOSSES. The Company shall reimburse each Lender and hold each
Lender harmless from any loss or expense which such Lender may sustain or incur
as a consequence of:
(a) the failure of the Company to make on a timely basis any payment
of principal of any Offshore Rate Loan;
(b) the failure of the Company to borrow, continue or convert to an
Offshore Loan after the Company has given (or is deemed to have given) a Notice
of Borrowing or a Notice of Conversion/ Continuation;
(c) the failure of the Company to make any prepayment of an Offshore
Rate Loan in accordance with any notice delivered under SECTION 2.7;
(d) the prepayment (including pursuant to SECTION 2.8) or other
payment (including after acceleration thereof) of an Offshore Rate Loan on a day
that is not the last day of the relevant Interest Period; or
(e) the automatic conversion under SECTION 2.4 of any Offshore Rate
Loan to a Base Rate Loan on a day that is not the last day of the relevant
Interest Period;
including any such loss or expense arising from the liquidation or reemployment
of funds obtained by it to maintain its Offshore Rate Loans or from fees payable
to terminate the deposits from which such funds were obtained. For purposes of
calculating amounts payable by the Company to the Lenders under this Section and
under SUBSECTION 4.3(a), each Offshore Rate Loan made by a Lender (and each
related reserve, special deposit or similar requirement) shall be conclusively
deemed to have been funded at the IBOR used in determining the Offshore Rate for
such Offshore Rate Loan by a matching deposit or other borrowing in the
interbank eurodollar market for a comparable amount and for a comparable period,
whether or not such Offshore Rate Loan is in fact so funded.
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4.5 INABILITY TO DETERMINE RATES. If the Agent determines that for any
reason adequate and reasonable means do not exist for determining the Offshore
Rate for any requested Interest Period with respect to a proposed Offshore Rate
Loan, or that the Offshore Rate applicable pursuant to SUBSECTION 2.10(a) for
any requested Interest Period with respect to a proposed Offshore Rate Loan does
not adequately and fairly reflect the cost to the Lenders of funding such Loan,
the Agent will promptly so notify the Company and each Lender. Thereafter, the
obligation of the Lenders to make or maintain Offshore Rate Loans hereunder
shall be suspended until the Agent revokes such notice in writing. Upon receipt
of such notice, the Company may revoke any Notice of Borrowing or Notice of
Conversion/Continuation then submitted by it. If the Company does not revoke
such Notice, the Lenders shall make, convert or continue the Loans, as proposed
by the Company, in the amount specified in the applicable notice submitted by
the Company, but such Loans shall be made, converted or continued as Base Rate
Loans instead of Offshore Rate Loans.
4.6 CERTIFICATES OF LENDERS. Any Lender claiming reimbursement or
compensation under this ARTICLE IV shall deliver to the Company (with a copy to
the Agent) a certificate setting forth in reasonable detail the amount payable
to such Lender hereunder and such certificate shall be conclusive and binding on
the Company in the absence of manifest error.
4.7 SUBSTITUTION OF LENDERS. Upon the receipt by the Company from any
Lender (an "AFFECTED LENDER") of a claim for compensation under SECTION 4.1 or
4.3 or a notice of the type described in SUBSECTION 4.2(a) or 4.2(b), the
Company may: (i) request the Affected Lender to use its best efforts to obtain
a replacement bank or financial institution satisfactory to the Company to
acquire and assume all or a ratable part of all of such Affected Lender's Loans
and Commitment (a "REPLACEMENT LENDER"); (ii) request one more of the other
Lenders to acquire and assume all or part of such Affected Lender's Loans and
Commitment; or (iii) designate a Replacement Lender. Any Replacement Lender
shall be an Eligible Assignee, and any designation of a replacement Lender under
CLAUSE (i) or (iii) shall be subject to the prior written consent of the Agent
(which consent shall not be unreasonably withheld).
4.8 SURVIVAL. The agreements and obligations of the Company in this
ARTICLE IV shall survive the payment of all other Obligations.
ARTICLE V
CONDITIONS PRECEDENT
5.1 CONDITIONS OF INITIAL CREDIT EXTENSIONS. The obligation of each
Lender to make its initial Credit Extension hereunder is subject to the
conditions that (i) Z/C shall have purchased not fewer than 1,000,000 newly-
issued Shares for a
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purchase price of $25 per Share in accordance with the terms of the
Recapitalization Agreement; (ii) the Recapitalization Agreement shall be in full
force and effect; (iii) the Company shall have completed (or shall have
submitted evidence reasonably satisfactory to the Agent that it will complete
concurrently with the initial Credit Extensions) the Tender Offer substantially
in accordance with the Offer to Purchase dated January 19, 1995 (without giving
effect to any modification of the terms of the offer thereunder (other than
extensions of the time thereof) unless consented to in writing by the Agent and
all Lenders); (iv) the Company shall have submitted evidence reasonably
satisfactory to the Agent that all Debt to be Repaid has been, or concurrently
with the initial Credit Extensions will be, paid in full; (v) the Closing Date
shall have occurred on or before April 30, 1995; and (vi) the Agent shall have
received on or before the Closing Date all of the following, in form and
substance satisfactory to the Agent and each Lender, and in sufficient copies
for each Lender:
(a) CREDIT AGREEMENT AND NOTES. This Agreement (and, if applicable,
any Notes) executed by each party thereto.
(b) RESOLUTIONS; INCUMBENCY.
(i) Copies of the resolutions of the board of directors of the
Company authorizing the transactions contemplated hereby, certified as of
the Closing Date by the Secretary or an Assistant Secretary of the Company;
and
(ii) A certificate of the Secretary or an Assistant Secretary of
the Company certifying the names and true signatures of the officers of the
Company authorized to execute, deliver and perform this Agreement and all
other Loan Documents to be delivered by it hereunder.
(c) ORGANIZATION DOCUMENTS; GOOD STANDING; OTHER DOCUMENTS. Each of
the following documents:
(i) the articles or certificate of incorporation and the bylaws
of the Company as in effect on the Closing Date, certified by the Secretary
or Assistant Secretary of the Company as of the Closing Date;
(ii) a good standing certificate for the Company from the
Secretary of State (or similar, applicable Governmental Authority) of its
state of incorporation and each state where the Company is qualified to do
business as a foreign corporation as of a recent date; and
(iii) copies, certified as being complete and accurate as of the
Closing Date, of the Recapitalization Agreement and the Standstill
Agreement.
(d) LEGAL OPINIONS.
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(i) an opinion of Bogle & Gates, counsel to the Company,
substantially in the form of EXHIBIT D-1; and an opinion of Rosenberg &
Liebentritt, special Illinois counsel to the Company in connection with the
Credit Agreement, substantially in the form of EXHIBIT D-2; and
(ii) an opinion of Mayer, Brown & Platt, special counsel to the
Agent, substantially in the form of EXHIBIT E.
(e) PAYMENT OF FEES. Evidence of payment by the Company of all
accrued and unpaid fees, costs and expenses to the extent then due and payable
on the Closing Date, together with Attorney Costs of BofA to the extent invoiced
prior to or on the Closing Date, plus such additional amounts of Attorney Costs
as shall constitute BofA's reasonable estimate of Attorney Costs incurred or to
be incurred by it through the closing proceedings (provided that such estimate
shall not thereafter preclude final settling of accounts between the Company and
BofA); including any such costs, fees and expenses arising under or referenced
in SECTIONS 2.11 and 10.4;
(f) CERTIFICATE. A certificate signed by a Responsible Officer,
dated as of the Closing Date, stating that:
(i) the representations and warranties contained in ARTICLE VI
are true and correct in all material respects on and as of such date, as
though made on and as of such date;
(ii) no Default or Event of Default exists or would result from
the requested Credit Extensions; and
(iii) no event or circumstance has occurred since December 25,
1993 that has resulted or could reason-ably be expected to result in a
Material Adverse Effect.
(g) SECURITY AGREEMENT, ETC. A security agreement, substantially in
the form of EXHIBIT H (the "Security Agreement"), and a Trademark Security
Agreement, substantially in the form of EXHIBIT I (the "Trademark Security
Agreement"), each issued by the Company, together with evidence, reasonably
satisfactory to the Agent, that all documents necessary to perfect the Agent's
Lien on the collateral granted under the Security Agreement and the Trademark
Security Agreement have been signed and delivered to the Agent in appropriate
form for filing or recording.
(h) OTHER DOCUMENTS. Such other approvals, documents or materials as
the Agent or any Lender may reasonably request.
5.2 CONDITIONS TO ALL CREDIT EXTENSIONS. The obligation of each Lender to
make any Loan, and the obligation of the Issuing Lender to Issue any Letter of
Credit, is subject to the
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satisfaction of the following conditions precedent on the relevant Borrowing
Date or Issuance Date:
(a) NOTICE, APPLICATION. In the case of any Loan, the Agent shall
have received (with, in the case of the initial Loans only, a copy for each
Lender) a Notice of Borrowing; or in the case of any Issuance of any Letter of
Credit, the Issuing Lender and the Agent shall have received an L/C Application
or L/C Amendment Application, as required under SECTION 3.2.
(b) CONTINUATION OF REPRESENTATIONS AND WARRANTIES. The
representations and warranties in ARTICLE VI shall be true and correct in all
material respects on and as of such Borrowing Date with the same effect as if
made on and as of such Borrowing Date or such Issuance Date (except to the
extent such representations and warranties expressly refer to an earlier date,
in which case they shall be true and correct as of such earlier date).
(c) NO EXISTING DEFAULT. No Default or Event of Default shall exist
or shall result from such Borrowing or such Issuance.
Each Notice of Borrowing and L/C Application or L/C Amendment Application
submitted by the Company hereunder shall constitute a representation and
warranty by the Company hereunder, as of the date of each such notice and as of
each Borrowing Date or Issuance Date, as applicable, that the conditions in this
SECTION 5.2 are satisfied.
ARTICLE VI
REPRESENTATIONS AND WARRANTIES
The Company represents and warrants to the Agent and each Lender that:
6.1 CORPORATE EXISTENCE AND POWER. The Company and each of its
Subsidiaries:
(a) is a corporation duly organized, validly existing and in good
standing under the laws of the jurisdiction of its incorporation;
(b) has the power and authority and all governmental licenses,
authorizations, consents and approvals to own its assets and to carry on its
business;
(c) is duly qualified as a foreign corporation and is licensed 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
or license; and
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(d) is in compliance with all Requirements of Law;
except, in each case, to the extent that the failure to do so could not
reasonably be expected to have a Material Adverse Effect.
6.2 CORPORATE AUTHORIZATION; NO CONTRAVENTION. The execution, delivery
and performance by the Company of this Agreement and each other Loan Document to
which the Company is party are within the corporate power and authority of the
Company, have been duly authorized by all necessary corporate action, and do not
and will not:
(a) contravene the terms of any of the Company's Organization
Documents;
(b) conflict with or result in any breach or contravention of, or
result in or require the creation of any Lien under, any document evidencing any
Contractual Obligation to which the Company or any Subsidiary is a party or any
order, injunction, writ or decree of any Governmental Authority to which the
Company or any Subsidiary or any property of the Company or any Subsidiary is
subject; or
(c) violate any Requirement of Law.
6.3 GOVERNMENTAL AUTHORIZATION. No approval, consent, exemption,
authorization, or other action by, or notice to, or filing with, any
Governmental Authority is necessary or required in connection with the
execution, delivery or performance by, or enforcement against, the Company of
the Agreement or any other Loan Document.
6.4 BINDING EFFECT. Each of this Agreement and each other Loan Document
to which the Company is a party constitutes the legal, valid and binding
obligation of the Company, enforceable against the Company in accordance with
its terms, except as enforceability may be limited by applicable bankruptcy,
insolvency, or similar laws affecting the enforcement of creditors' rights
generally or by equitable principles relating to enforceability.
6.5 LITIGATION. Except as specifically disclosed in SCHEDULE 6.5, there
are no actions, suits, proceedings, claims or disputes pending or, to the best
knowledge of the Company, threatened, at law, in equity, in arbitration or
before any Governmental Authority, against the Company, its Subsidiaries or any
of their respective properties which (a) purport to affect or pertain to this
Agreement or any other Loan Document, or any of the transactions contemplated
hereby or thereby; or (b) would reasonably be expected to have a Material
Adverse Effect. No injunction, writ, temporary restraining order or any order
of any nature has been issued by any court or other Governmental Authority
purporting to enjoin or restrain the execution, delivery or performance of this
Agreement or any other Loan
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Document, or directing that the transactions provided for herein or therein not
be consummated as herein or therein provided.
6.6 NO DEFAULT. No Default or Event of Default exists or would result
from the incurring of any Obligations by the Company. As of the Closing Date,
neither the Company nor any Subsidiary is in default under or with respect to
any Contractual Obligation in any respect which, individually or together with
all such defaults, could reasonably be expected to have a Material Adverse
Effect, or that would, if such default had occurred after the Closing Date,
create an Event of Default under SUBSECTION 9.1(e).
6.7 ERISA COMPLIANCE. Except as specifically disclosed in SCHEDULE 6.7:
(a) (i) Each Plan is in compliance in all material respects with the
applicable provisions of ERISA, the Code and other federal or state law; (ii)
each Plan which is intended to qualify under Section 401(a) of the Code has
received a favorable determination letter from the IRS and, to the best
knowledge of the Company, nothing has occurred which would cause the loss of
such qualification; (iii) the Company and each ERISA Affiliate has made all
required contributions to any Plan subject to Section 412 of the Code; and (iv)
no application for a funding waiver or an extension of any amortization period
pursuant to Section 412 of the Code has been made with respect to any Plan.
(b) There are no pending or, to the best knowledge of Company,
threatened claims, actions or lawsuits, or action by any Governmental Authority,
with respect to any Plan which has resulted or could reasonably be expected to
result in a Material Adverse Effect. There has been no prohibited transaction
or violation of the fiduciary responsibility rules with respect to any Plan
which has resulted or could reasonably be expected to result in a Material
Adverse Effect.
(c) (i) No ERISA Event has occurred or is reasonably expected to
occur; (ii) neither the Company nor any ERISA Affiliate has incurred, or
reasonably expects to incur, any liability under Title IV of ERISA with respect
to any Pension Plan (other than premiums due and not delinquent under Section
4007 of ERISA); and (iii) neither the Company nor any ERISA Affiliate has
engaged in a transaction that could be subject to Section 4069 or 4212(c) of
ERISA.
6.8 USE OF PROCEEDS; MARGIN REGULATIONS. The proceeds of the Loans are to
be used solely for the purposes set forth in and permitted by SECTION 7.12 and
SECTION 8.6. Neither the Company nor any Subsidiary is generally engaged in the
business of purchasing or selling Margin Stock or extending credit for the
purpose of purchasing or carrying Margin Stock.
6.9 TITLE TO PROPERTIES. Each of the Company and each Subsidiary has good
record and marketable title in fee simple to,
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or valid leasehold interests in, all real property necessary or used in the
ordinary conduct of its businesses, except for such defects in title as could
not, individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect. As of the Closing Date, the property of the Company and its
Subsidiaries is subject to no Liens, other than Permitted Liens.
6.10 TAXES. The Company and its Subsidiaries have filed all Federal and
other material tax returns and reports required to be filed, and have paid all
Federal and other material taxes, assessments, fees and other governmental
charges levied or imposed upon them or their properties, income or assets
otherwise due and payable, except those which are being contested in good faith
by appropriate proceedings and for which adequate reserves have been provided in
accordance with GAAP. As of the date of this Agreement, the Company does not
have knowledge of any proposed tax assessment against the Company or any
Subsidiary that would, if made, have a Material Adverse Effect.
6.11 FINANCIAL CONDITION. (a) The audited consolidated financial
statements of the Company and its Subsidiaries dated December 25, 1993, and the
unaudited consolidated financial statements of the Company and its Subsidiaries
dated September 3, 1994, and the related consolidated statements of income or
operations, shareholders' equity and cash flows for the fiscal periods ended on
such dates:
(i) were prepared in accordance with GAAP consistently applied
throughout the periods covered thereby, except as otherwise expressly noted
therein (subject, in the case of the unaudited statements, to normal year-
end audit adjustments);
(ii) fairly present the financial condition of the Company and
its Subsidiaries as of the dates thereof and results of operations for the
periods covered thereby; and
(iii) except as specifically disclosed in SCHEDULE 6.11, show
all material indebtedness and other liabilities, direct or contingent, of
the Company and its consolidated Subsidiaries as of the date thereof,
including liabilities for taxes, material commitments and Contingent
Obligations.
(b) The pro forma condensed balance sheet of the Company as at
September 3, 1994 and December 25, 1993, and the pro forma condensed statements
of earnings for the periods then ended, were prepared in accordance with GAAP
(subject to the absence of footnotes and, in the case of the September 3, 1994
statements, subject to normal year-end audit adjustments) and fairly present the
pro forma financial condition of the Company and its Subsidiaries as of the
dates thereof and results of operations for the periods covered thereby (giving
effect, in each case, to (i) the issuance of 1,000,000 Shares to Z/C at $25 per
Share, (ii) the purchase of 7,000,000 Shares pursuant to the
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Tender Offer, (iii) the acquisition of Olson's Foods and (iv) the borrowings
hereunder in connection with the preceding ITEMS (ii) and (iii).
(c) Since December 25, 1993, there has been no Material Adverse
Effect.
6.12 ENVIRONMENTAL MATTERS. The Company conducts in the ordinary course of
business a review of the effect of existing Environmental Laws and existing
Environmental Claims on its business, operations and properties, and as a result
thereof the Company has reasonably concluded that, except as specifically
disclosed in SCHEDULE 6.12, such Environmental Laws and Environmental Claims
could not, individually or in the aggregate, reasonably be expected to have a
Material Adverse Effect.
6.13 REGULATED ENTITIES. None of the Company, any Person controlling the
Company, or any Subsidiary is an "Investment Company" within the meaning of the
Investment Company Act of 1940. The Company is not subject to regulation under
the Public Utility Holding Company Act of 1935, the Federal Power Act, the
Interstate Commerce Act, any state public utilities code, or any other Federal
or state statute or regulation limiting its ability to incur Indebtedness.
6.14 NO BURDENSOME RESTRICTIONS. Neither the Company nor any Subsidiary is
a party to or bound by any Contractual Obligation, or subject to any restriction
in any Organization Document, or any Requirement of Law, which could reasonably
be expected to have a Material Adverse Effect.
6.15 COPYRIGHTS, PATENTS, TRADEMARKS AND LICENSES, ETC. The Company or its
Subsidiaries own or are licensed or otherwise have the right to use all of the
patents, trademarks, service marks, trade names, copyrights, contractual
franchises, authorizations and other rights that are reasonably necessary for
the operation of their respective businesses, without conflict with the rights
of any other Person. To the best knowledge of the Company, no slogan or other
advertising device, product, process, method, substance, part or other material
now employed, or now contemplated to be employed, by the Company or any
Subsidiary infringes upon any rights held by any other Person.
6.16 SUBSIDIARIES. As of the Closing Date, the Company has no Subsidiaries
other than those specifically disclosed in PART (a) of SCHEDULE 6.16 and has no
equity investments in any other corporation or entity other than those
specifically disclosed in PART (b) of SCHEDULE 6.16.
6.17 INSURANCE. Except as specifically disclosed in SCHEDULE 6.17, the
properties of the Company and each of its Subsidiaries are insured with
financially sound and reputable insurance companies which are not Affiliates of
the Company, in such amounts, with such deductibles and covering such risks as
are customarily carried by companies engaged in similar businesses and owning
similar
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properties in localities where the Company or such Subsidiary operates.
6.18 FULL DISCLOSURE. None of the representations or warranties made by
the Company or any Subsidiary in the Loan Documents as of the date such
representations and warranties are made or deemed made, and none of the
statements contained in any exhibit, report, statement or certificate furnished
by or on behalf of the Company or any Subsidiary in connection with the Loan
Documents (including the offering and disclosure materials delivered by or on
behalf of the Company to the Lenders prior to the Closing Date), contains any
untrue statement of a material fact or omits any material fact required to be
stated therein or necessary to make the statements made therein, in light of the
circumstances under which they are made, not misleading as of the time when made
or delivered.
ARTICLE VII
AFFIRMATIVE COVENANTS
So long as any Lender shall have any Commitment hereunder, or any Loan or
other Obligation for the payment of money shall remain unpaid, or any Letter of
Credit shall remain outstanding, unless the Majority Lenders waive compliance in
writing:
7.1 FINANCIAL STATEMENTS. The Company shall deliver to the Agent, in form
and detail satisfactory to the Agent and the Majority Lenders, with sufficient
copies for each Lender:
(a) as soon as available, but not later than 90 days after the end
of each fiscal year (commencing with the fiscal year ended December 31, 1994), a
copy of the audited consolidated balance sheet of the Company and its
Subsidiaries as at the end of such year and the related consolidated statements
of income or operations, shareholders' equity and cash flows for such year,
setting forth in each case in comparative form the figures for the previous
fiscal year, and accompanied by the opinion of Deloitte & Touche or another
nationally-recognized independent public accounting firm ("INDEPENDENT
AUDITOR"), which opinion (x) shall state that such consolidated financial
statements present fairly the financial position of the Company and its
Subsidiaries for the periods indicated in conformity with GAAP applied on a
basis consistent with prior years and (y) shall not be qualified or limited
because of a restricted or limited examination by the Independent Auditor of any
material portion of the Company's or any Subsidiary's records; and
(b) as soon as available, but not later than 45 days after the end of
each of the first three fiscal quarters of each fiscal year (commencing with the
fiscal quarter ended March 25, 1995), a copy of the unaudited consolidated
balance sheet of the Company and its Subsidiaries as of the end of such quarter
and the related consolidated statements of income, shareholders'
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equity and cash flows for the period commencing on the first day and ending on
the last day of such quarter, and certified by a Responsible Officer as fairly
presenting, in accordance with GAAP (subject to normal year-end audit
adjustments), the financial position and the results of operations of the
Company and its Subsidiaries;
7.2 CERTIFICATES; OTHER INFORMATION. The Company shall furnish to the
Agent, with sufficient copies for each Lender:
(a) concurrently with the delivery of the financial statements
referred to in SUBSECTION 7.1(a), a certificate of the Independent Auditor
stating that in making the examination necessary therefor no knowledge was
obtained of any Default or Event of Default, except as specified in such
certificate;
(b) concurrently with the delivery of the financial statements
referred to in SUBSECTIONS 7.1(a) and (b), a Compliance Certificate executed by
a Responsible Officer;
(c) promptly, copies of all financial statements and reports that the
Company sends to its shareholders, and copies of all financial statements and
regular, periodic or special reports (including Forms 10K, 10Q and 8K) that the
Company or any Subsidiary may make to, or file with, the SEC;
(d) as soon as available, and in any event within 30 days after the
commencement of each fiscal year, the business plan for such year and projected
income statements, balance sheets and statements of cash flows as at the end of
each quarter of such fiscal year; and
(e) promptly, such additional information regarding the business,
financial or corporate affairs of the Company or any Subsidiary as the Agent, at
the request of any Lender, may from time to time reasonably request.
7.3 NOTICES. The Company shall promptly notify the Agent and each Lender:
(a) of the occurrence of any Default or Event of Default;
(b) of any matter that has resulted or could reasonably be expected
to result in a Material Adverse Effect, including (i) breach or non-performance
of, or any default under, a Contractual Obligation of the Company or any
Subsidiary; (ii) any dispute, litigation, investigation or proceeding between
the Company or any Subsidiary and any Governmental Authority; or (iii) the
commencement of, or any material development in, any litigation or proceeding
affecting the Company or any Subsidiary, including pursuant to any applicable
Environmental Laws;
(c) of the occurrence of any of the following events affecting the
Company or any ERISA Affiliate (but in no event
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more than 10 Business Days after such event), and deliver to the Agent and each
Lender a copy of any notice with respect to such event that is filed with a
Governmental Authority and any notice delivered by a Governmental Authority to
the Company or any ERISA Affiliate with respect to such event:
(i) an ERISA Event;
(ii) the adoption of, or the commencement of contributions to,
any Plan subject to Section 412 of the Code by the Company or any ERISA
Affiliate; or
(iii) the adoption of any amendment to a Plan subject to Section
412 of the Code, if such amendment results in a material increase in
contributions or Unfunded Pension Liability; and
(d) of any material change in accounting policies or financial
reporting practices by the Company or any of its consolidated Subsidiaries.
Each notice under this Section shall be accompanied by a written
statement by a Responsible Officer setting forth details of the occurrence
referred to therein, and stating what action the Company or any affected
Subsidiary has taken or proposes to take with respect thereto. Each notice
under SUBSECTION 7.3(a) shall describe with particularity any and all clauses or
provisions of this Agreement or other Loan Document that have been breached or
violated. Without limiting any of the foregoing provisions of this SECTION 7.3,
the Company will promptly notify the Agent and each Lender (and, to the extent
possible, give the Agent and each Lender at least 10 days' prior written notice
of) any contribution failure sufficient to give rise to a Lien under Section
302(f) of ERISA.
7.4 PRESERVATION OF CORPORATE EXISTENCE, ETC. The Company shall, and
shall cause each Subsidiary to:
(a) preserve and maintain in full force and effect its corporate
existence and good standing under the laws of its state or jurisdiction of
incorporation;
(b) preserve and maintain in full force and effect all governmental
rights, privileges, qualifications, permits, licenses and franchises necessary
or desirable in the normal conduct of its business except in connection with
transactions permitted by SECTION 8.2;
(c) use reasonable efforts, in the ordinary course of business, to
preserve its business organization and goodwill; and
(d) preserve or renew all of its registered patents, trademarks,
trade names and service marks, the non-preservation of which could reasonably be
expected to have a Material Adverse Effect.
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7.5 MAINTENANCE OF PROPERTY. The Company shall maintain, and shall cause
each Subsidiary to maintain, and preserve all its property which is used or
useful in its business in good working order and condition, ordinary wear and
tear excepted. The Company and each Subsidiary shall use the standard of care
typical in the industry in the operation and maintenance of its facilities.
7.6 INSURANCE. The Company shall maintain, and shall cause each
Subsidiary to maintain, with financially sound and reputable independent
insurers, insurance with respect to its properties and business against loss or
damage of the kinds customarily insured against by Persons engaged in the same
or similar business, of such types and in such amounts as are customarily
carried under similar circumstances by such other Persons.
7.7 PAYMENT OF OBLIGATIONS. The Company shall, and shall cause each
Subsidiary to, pay and discharge as the same shall become due and payable all
their respective material obligations and liabilities, including:
(a) all tax liabilities, assessments and governmental charges or
levies upon it or its properties or assets; and
(b) all lawful material claims which, if unpaid, would by law become
a Lien upon its property;
unless, in each case, the same are being contested in good faith by appropriate
proceedings and adequate reserves in accordance with GAAP are being maintained
by the Company or such Subsidiary (it being understood that any failure to pay
any material Indebtedness shall not constitute a breach of this SECTION 7.7
unless such failure also constitutes an Event of Default under SECTION 9.1(e)).
7.8 COMPLIANCE WITH LAWS. The Company shall comply, and shall cause each
Subsidiary to comply, in all material respects with all Requirements of Law of
any Governmental Authority having jurisdiction over it or its business
(including the Federal Fair Labor Standards Act), except such as may be
contested in good faith or as to which a bona fide dispute may exist.
7.9 COMPLIANCE WITH ERISA. The Company shall, and shall cause each of its
ERISA Affiliates to: (a) maintain each Pension Plan in compliance in all
material respects with the applicable provisions of ERISA, the Code and other
federal or state law; and (b) make all required contributions to any Plan
subject to Section 412 of the Code.
7.10 INSPECTION OF PROPERTY AND BOOKS AND RECORDS. The Company shall
maintain, and shall cause each Subsidiary to maintain, proper books of record
and account, in which full, true and correct entries in conformity with GAAP
consistently applied shall be made of all financial transactions and matters
involving
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the assets and business of the Company or each Subsidiary. The Company shall
permit, and shall cause each Subsidiary to permit, representatives and
independent contractors of the Agent or any Lender to visit and inspect any of
their respective properties, to examine their respective corporate, financial
and operating records, and make copies thereof or abstracts therefrom, and to
discuss their respective affairs, finances and accounts with their respective
directors, officers, and independent public accountants, all at the expense of
the Company and at such reasonable times during normal business hours and as
often as may be reasonably desired, upon reasonable advance notice to the
Company; PROVIDED, HOWEVER, when an Event of Default exists the Agent or any
Lender may do any of the foregoing at any time during normal business hours and
without advance notice.
7.11 ENVIRONMENTAL LAWS. The Company shall, and shall cause each
Subsidiary to, conduct its operations and keep and maintain its property in
compliance with all Environmental Laws.
7.12 USE OF PROCEEDS. The Company shall use the proceeds of the Loans only
for (a) the purchase of up to 7,000,000 Shares pursuant to the Tender Offer,
PROVIDED that all Shares so purchased shall be immediately retired, (b) the
refinancing of Debt to be Repaid, (c) the payment of fees and expenses in
connection with this Agreement and the Tender Offer and (d) working capital and
other general corporate purposes (including Acquisitions) not in contravention
of any Requirement of Law or of any Loan Document.
7.13 BUSINESS. The Company shall continue to conduct substantially all of
its consolidated business directly and not through Subsidiaries.
7.14 FURTHER ASSURANCES. The Company shall take such actions as are
reasonably necessary, or as the Agent or any Lender may from time to time
reasonably request, to ensure that the Obligations are secured by a perfected
Lien on all accounts receivable and general intangibles of the Company.
ARTICLE VIII
NEGATIVE COVENANTS
So long as any Lender shall have any Commitment hereunder, or any Loan or
other Obligation for the payment of money shall remain unpaid or any Letter of
Credit shall remain outstanding, unless the Majority Lenders waive compliance in
writing:
8.1 LIMITATION ON LIENS. The Company shall not, and shall not permit any
Subsidiary to, directly or indirectly, make, create, incur, assume or permit to
exist any Lien upon or with respect to any part of its property, whether now
owned or hereafter acquired, other than the following ("PERMITTED LIENS"):
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(a) any Lien existing on property of the Company or any Subsidiary on
the Closing Date and set forth in SCHEDULE 8.1 securing Indebtedness outstanding
on such date;
(b) any Lien created under any Loan Document;
(c) Liens for taxes, fees, assessments or other governmental charges
which are not delinquent or remain payable without penalty, or to the extent
that non-payment thereof is permitted by SECTION 7.7, provided that no notice of
lien has been filed or recorded under the Code or any other Requirement of Law;
(d) carriers', warehousemen's, mechanics', landlords', materialmen's,
repairmen's or other similar Liens arising in the ordinary course of business
which are not delinquent or remain payable without penalty or which are being
contested in good faith and by appropriate proceedings, which proceedings have
the effect of preventing the forfeiture or sale of the property subject thereto;
(e) Liens (other than any Lien imposed by ERISA) consisting of
pledges or deposits required in the ordinary course of business in connection
with workers' compensation, unemployment insurance and other social security
legislation;
(f) Liens on property of the Company or its Subsidiary securing (i)
the non-delinquent performance of bids, trade contracts (other than for borrowed
money), leases, statutory obligations, (ii) contingent obligations on surety and
appeal bonds, and (iii) other non-delinquent obligations of a like nature; in
each case, incurred in the ordinary course of business, provided all such Liens
in the aggregate would not (even if enforced) reasonably be expected to cause a
Material Adverse Effect;
(g) Liens consisting of judgment or judicial attachment liens,
provided that the enforcement of such Liens is effectively stayed and all such
liens in the aggregate at any time outstanding for the Company and its
Subsidiaries do not exceed $5,000,000;
(h) easements, rights-of-way, restrictions and other similar
encumbrances incurred in the ordinary course of business which, in the
aggregate, are not substantial in amount, and which do not in any case
materially detract from the value of the property subject thereto or interfere
with the ordinary conduct of the businesses of the Company and its Subsidiaries;
(i) Liens on real property acquired after the Closing Date securing
Indebtedness permitted by SUBSECTION 8.4(d);
(j) Liens on personal property securing Indebtedness permitted by
SUBSECTION 8.4(e), provided that the aggregate
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amount of all Indebtedness secured by such Liens shall not at any time exceed
$5,000,000;
(k) Liens arising solely by virtue of any statutory or common law
provision relating to banker's liens, rights of set-off or similar rights and
remedies as to deposit accounts or other funds maintained with a creditor
depository institution; PROVIDED THAT (i) such deposit account is not a
dedicated cash collateral account and is not subject to restrictions against
access by the Company in excess of those set forth by regulations promulgated by
the FRB, and (ii) such deposit account is not intended by the Company or any
Subsidiary to provide collateral to the depository institution; and
(l) Liens on inventory (i) that is in the possession or control of a
wholesaler or supplier, (ii) has not been delivered to or paid for by the
Company or any Subsidiary and (iii) for which neither the Company nor any
Subsidiary has any obligation to make any payment until such delivery is made
and accepted.
8.2 CONSOLIDATIONS AND MERGERS. The Company shall not, and shall not
permit any Subsidiary to, merge, consolidate with or into, or convey, transfer,
lease or otherwise dispose of (whether in one transaction or in a series of
transactions all or substantially all of its assets (whether now owned or
hereafter acquired) to or in favor of any Person, or make any Acquisition
except:
(a) any Subsidiary may merge with the Company, provided that the
Company shall be the continuing or surviving corporation, or with any one or
more Subsidiaries, provided that if any transaction shall be between a
Subsidiary and a Wholly-Owned Subsidiary, the Wholly-Owned Subsidiary shall be
the continuing or surviving corporation;
any Subsidiary may sell all or substantially all of its assets
(upon voluntary liquidation or otherwise) to the Company or another Wholly-Owned
Subsidiary; and
(c) the Company may make Acquisitions permitted by SUBSECTION 8.3(d).
8.3 LOANS AND INVESTMENTS. The Company shall not purchase or acquire, or
permit any Subsidiary to purchase or acquire, or make any commitment therefor,
any capital stock, equity interest, or any obligations or other securities of,
or any interest in, any Person, or make or commit to make any Acquisitions, or
make or commit to make any advance, loan, extension of credit or capital
contribution to or any other investment in, any Person including any Affiliate
of the Company, except for:
(a) investments in cash equivalents and short term marketable
securities;
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(b) extensions of credit in the nature of accounts receivable or
notes receivable arising from the sale or lease of goods or services in the
ordinary course of business;
(c) extensions of credit by the Company to any of its Wholly-Owned
Subsidiaries or by any of its Wholly-Owned Subsidiaries to another of its
Wholly-Owned Subsidiaries;
(d) investments incurred in order to consummate Acquisitions,
PROVIDED that (i) no Default or Event of Default exists or will result
therefrom, (ii) after giving effect to such Acquisition, the unused availability
under the Revolving Commitment will be equal to or greater than 1.5% of the
Company's sales for the most recently-ended Computation Period and (iii) in the
case of any Acquisition or series of related Acquisitions involving six or more
retail stores, the Company shall have delivered to the Agent a certificate
setting forth calculations showing that on a PRO FORMA basis, after giving
effect to such Acquisition(s) (as if such Acquisition(s) had occurred on the
first day of the most recently-ended Computation Period), the Company would have
been in compliance with SECTIONS 8.10, 8.11 and 8.12 as of such most recently-
ended Computation Period; and
(e) investments in Joint Ventures, investments in minority interests
in other Persons and investments in Persons which are not 80%-Owned Subsidiaries
(as defined below), PROVIDED that (i) no Default or Event of Default exists or
will result therefrom, (ii) such Joint Venture or Person is or will be engaged
solely in businesses in which the Company would be permitted to be engaged
pursuant to SECTION 8.16 and (iii) the aggregate amount of all such investments
made by the Company and all of its Subsidiaries during the term of this
Agreement does not exceed $10,000,000. For purposes of the foregoing, "80%-
Owned Subsidiary" means any corporation in which (other than directors'
qualifying shares required by law) 80% or more of the capital stock of each
class having ordinary voting power, and 80% of the capital stock of every other
class, in each case, is owned, beneficially and of record, by the Company, or by
one or more Wholly-Owned Subsidiaries, or both.
8.4 LIMITATION ON INDEBTEDNESS. The Company shall not, and shall not
permit any Subsidiary to, create, incur, assume, permit to exist, or otherwise
become or remain directly or indirectly liable with respect to, any
Indebtedness, except:
(a) Indebtedness incurred pursuant to this Agreement;
(b) Indebtedness consisting of Contingent Obligations permitted
pursuant to SECTION 8.7;
(c) Indebtedness existing on the Closing Date and set forth in
SCHEDULE 8.4;
(d) Indebtedness secured by mortgages on real property acquired after
the Closing Date not exceeding
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$75,000,000 in the aggregate at any time outstanding; PROVIDED that not more
than $10,000,000 of the principal amount of all such Indebtedness shall be
payable before the Revolving Termination Date; and
(e) other Indebtedness not exceeding $10,000,000 in the aggregate at
any time outstanding.
8.5 TRANSACTIONS WITH AFFILIATES. The Company shall not, and shall not
permit any Subsidiary to, enter into any transaction with any Affiliate of the
Company (other than a Subsidiary), except upon fair and reasonable terms no less
favorable to the Company or such Subsidiary than would obtain in a comparable
arm's-length transaction with a Person not an Affiliate of the Company or such
Subsidiary.
8.6 USE OF PROCEEDS. (a) The Company shall not, and shall not suffer or
permit any Subsidiary to, use any portion of the Loan proceeds or any Letter of
Credit, directly or indirectly, (i) to purchase or carry Margin Stock (other
than Shares), (ii) to repay or otherwise refinance indebtedness of the Company
or others incurred to purchase or carry Margin Stock, (iii) to extend credit for
the purpose of purchasing or carrying any Margin Stock, or (iv) to acquire any
security (other than Shares) in any transaction that is subject to Section 13 or
14 of the Exchange Act.
(b) The Company shall not, directly or indirectly, use any portion of
the Loan proceeds or any Letter of Credit (i) knowingly to purchase Ineligible
Securities from the Arranger during any period in which the Arranger makes a
market in such Ineligible Securities, (ii) knowingly to purchase during the
underwriting or placement period Ineligible Securities being underwritten or
privately placed by the Arranger, or (iii) to make payments of principal or
interest on Ineligible Securities underwritten or privately placed by the
Arranger and issued by or for the benefit of the Company or any Affiliate of the
Company. The Arranger is a registered broker-dealer and permitted to underwrite
and deal in certain Ineligible Securities; and "INELIGIBLE SECURITIES" means
securities which may not be underwritten or dealt in by member banks of the
Federal Reserve System under Section 16 of the Banking Act of 1933 (12 U.S.C.
Section 24, Seventh), as amended.
8.7 CONTINGENT OBLIGATIONS. The Company shall not, and shall not permit
any Subsidiary to, create, incur, assume or permit to exist any Contingent
Obligations except:
(a) endorsements for collection or deposit in the ordinary course of
business;
(b) Swap Contracts entered into in the ordinary course of business as
bona fide hedging transactions;
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(c) Contingent Obligations of the Company and its Subsidiaries
existing as of the Closing Date and listed in SCHEDULE 8.7; and
(d) other Contingent Obligations (other than letters of credit) not
at any time exceeding in the aggregate $7,500,000.
8.8 JOINT VENTURES. The Company shall not, and shall not permit any
Subsidiary to, enter into any Joint Venture, except as permitted by SUBSECTION
8.3(e).
8.9 RESTRICTED PAYMENTS. The Company shall not, and shall not permit any
Subsidiary to, declare or make any dividend payment or other distribution of
assets, properties, cash, rights, obligations or securities on account of any
shares of any class of its capital stock, or purchase, redeem or otherwise
acquire for value any shares of its capital stock or any warrants, rights or
options to acquire such shares, now or hereafter outstanding; except that (i)
any Subsidiary may pay dividends to the Company and (ii):
(a) the Company may declare and make dividend payments or other
distributions payable solely in Shares;
(b) the Company may purchase, redeem or otherwise acquire Shares or
warrants or options to acquire Shares with the proceeds received from the
substantially concurrent issue of new Shares;
(c) the Company may purchase Shares pursuant to the Tender Offer;
(d) during the period from the Closing Date through January 1, 1997,
the Company may repurchase Shares in an aggregate amount not exceeding the
product of (x) $140,000,000 minus (i) the amount of the Term Commitment or (ii)
if the Term Commitment is zero because fewer than 2,000,000 Shares are duly
tendered and repurchased pursuant to the Tender Offer, the Supplemental Revolver
Amount MULTIPLIED BY (y) 0.2; and
(e) after January 1, 1997, the Company may declare and pay cash
dividends to its stockholders or purchase, redeem or otherwise acquire shares of
its capital stock or warrants, rights or options to acquire such shares in an
aggregate amount not exceeding (i) 25% of Net Income for the preceding fiscal
year if, after giving effect to such restricted payment, the Funded Debt to
EBITDA Ratio is greater than 1.5 to 1 and (ii) 50% of Net Income for the
preceding fiscal year if, after giving effect to such restricted payment, the
Funded Debt to EBITDA Ratio is equal to or less than 1.5 to 1;
PROVIDED, HOWEVER, that (x) no restricted payment shall be permitted under
SUBSECTION (d) or (e) above if a Default or Event of Default exists or would
result therefrom and (y) no restricted payment shall be permitted under CLAUSE
(e) above if Net Income
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for the then-completed portion of the current fiscal year is not positive.
8.10 INTEREST AND RENTAL EXPENSE COVERAGE RATIO. The Company shall not
permit the ratio of (a) EBITDA plus rent expense for any Computation Period to
(b) the sum of interest expense plus rent expense for such Computation Period to
be less than the applicable ratio set forth below for such Computation Period:
Computation If Case 1 If Case 2
Period Ending applies applies
------------- --------- ---------
06/17/95 to 09/06/97 2.50 2.15
12/27/97 to 09/05/98 2.50 2.25
12/26/98 to 09/04/99 2.50 2.35
Thereafter 2.50 2.50
8.11 FIXED CHARGE COVERAGE RATIO. The Company shall not permit the ratio
of (a) EBITDA for any Computation Period to (b) the sum for such Computation
Period of (i) cash interest expense, (ii) income taxes paid in cash and (iii)
all scheduled payments on long-term Funded Debt (including any scheduled
payments of Term Loans pursuant to SECTION 2.9), and, if applicable, any
scheduled reduction of the Revolving Commitment pursuant to SECTION 2.9, to be
less than the applicable ratio set forth below for such Computation Period:
Computation If Case 1 If Case 2
Period Ending applies applies
------------- --------- ---------
06/17/95 to 12/28/96 2.25 2.10
03/22/97 to 09/05/98 1.50 1.25
12/26/98 to 12/30/00 1.50 1.35
Thereafter 1.50 1.40
8.12 FUNDED DEBT TO EBITDA RATIO. The Company shall not permit the Funded
Debt to EBITDA Ratio to be greater than the applicable ratio set forth below at
any time during any period set forth below:
If Case 1 If Case 2
Period applies applies
------ --------- ---------
06/17/95 to 12/27/96 2.50 3.50
12/28/96 to 12/26/97 2.50 3.25
Thereafter 2.50 3.00
TRADE SUPPORT RATIO. The Company shall not permit the ratio of (a)
all accounts payable of the Company and its Subsidiaries to (b) all inventory of
the Company and its Subsidiaries, valued at the lower of market value and cost
(determined on a last-in, first-out basis), measured as of 3:00 a.m. (San
Francisco time) on each Saturday morning, to be less than 0.7 to 1 for two
consecutive weeks.
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8.14 NET WORTH. The Company shall not at any time permit its consolidated
shareholders' equity to be less than the sum of (a) the Net Worth Base Level (as
defined below) plus (b) the Specified Percentage (as defined below) of Net
Income (but not less than zero in any fiscal quarter) for each fiscal quarter of
the Company ended on or after June 17, 1995. For purposes of the foregoing,
"Net Worth Base Level" means the amount set forth under the heading Net Worth
Base Level on SCHEDULE 8.14 opposite the applicable number of Shares purchased
by the Company pursuant to the Tender Offer; and "Specified Percentage" means,
for any fiscal quarter, (i) if the Funded Debt to EBITDA Ratio was greater than
1.5 to 1 as of the last day of such fiscal quarter, 75%; and (ii) otherwise,
50%.
8.15 ERISA. The Company shall not, and shall not permit any of its ERISA
Affiliates to, engage in a transaction that could be subject to Section 4069 or
4212(c) of ERISA.
8.16 CHANGE IN BUSINESS. The Company shall not, and shall not permit any
Subsidiary to, engage in any material line of business substantially different
from those lines of business carried on by the Company and its Subsidiaries on
the date hereof and businesses reasonably related thereto.
8.17 HOSTILE ACQUISITIONS. The Company shall not, and shall not permit any
Subsidiary to, engage in any transaction having as its purpose the Acquisition
of any Person if such Person (or its Board of Directors or equivalent governing
body) has (a) announced that it will oppose such Acquisition or (b) commenced
any litigation which alleges that such Acquisition violates, or will violate,
any Requirement of Law.
8.18 ACCOUNTING CHANGES. The Company shall not, and shall not permit any
Subsidiary to, make any significant change in accounting treatment or reporting
practices, except as required by GAAP, or change the fiscal year of the Company
or of any Subsidiary.
8.19 AMENDMENTS TO CERTAIN DOCUMENTS. The Company will not make or agree
to any amendment to or modification of, or waive any of its rights under, the
Standstill Agreement or the Recapitalization Agreement (other than any amendment
or modification to cure any ambiguity, to correct or supplement any provision
thereof which may be inconsistent with any other provision therein or to make
any other technical amendment thereto which, in any such case, is not material
and, in any event, is not adverse to the interests of the Lenders).
ARTICLE IX
EVENTS OF DEFAULT
9.1 EVENT OF DEFAULT. Any of the following shall constitute an "EVENT OF
DEFAULT":
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(a) NON-PAYMENT. The Company fails to pay, (i) when and as required
to be paid herein, any amount of principal of any Loan or of any L/C Obligation,
or (ii) within five days after the same becomes due, any interest, fee or any
other amount payable hereunder or under any other Loan Document.
(b) REPRESENTATION OR WARRANTY. Any representation or warranty by
the Company or any Subsidiary made or deemed made herein, in any other Loan
Document, or which is contained in any certificate, document or financial or
other statement of the Company, any Subsidiary, or any Responsible Officer,
furnished at any time under this Agreement, or in or under any other Loan
Document, is incorrect in any material respect on or as of the date made or
deemed made.
(c) SPECIFIC DEFAULTS. The Company fails to perform or observe any
term, covenant or agreement contained in ARTICLE VIII.
(d) OTHER DEFAULTS. The Company fails to perform or observe any
other term or covenant contained in this Agreement or any other Loan Document,
and such default shall continue unremedied for a period of 30 days after the
earlier of (i) the date upon which a Responsible Officer knew of such failure or
(ii) the date upon which written notice thereof is given to the Company by the
Agent or any Lender.
(e) CROSS-DEFAULT. The Company or any Subsidiary (i) fails to make
any payment of principal of or interest on any Indebtedness or Contingent
Obligation having an aggregate principal amount (including amounts owing to all
creditors under any combined or syndicated credit arrangement) of more than
$5,000,000 when due (whether by scheduled maturity, required prepayment,
acceleration, demand, or otherwise) and such failure continues after the
applicable grace or notice period, if any, specified in the relevant document on
the date of such failure; or (ii) fails to perform or observe any other
condition or covenant, or any other event shall occur or condition exist, under
any agreement or instrument relating to any such Indebtedness or Contingent
Obligation, if the effect of such failure, event or condition is to cause, or to
permit the holder or holders of such Indebtedness or beneficiary or
beneficiaries of such Indebtedness (or a trustee or agent on behalf of such
holder or holders or beneficiary or beneficiaries) to cause such Indebtedness to
be declared to be due and payable prior to its stated maturity, or such
Contingent Obligation to become payable or cash collateral in respect thereof to
be demanded.
(f) INSOLVENCY; VOLUNTARY PROCEEDINGS. The Company or any Subsidiary
(i) ceases or fails to be solvent, or generally fails to pay, or admits in
writing its inability to pay, its debts as they become due, subject to
applicable grace periods, if any, whether at stated maturity or otherwise; (ii)
voluntarily ceases to conduct its business in the ordinary course; (iii)
commences any Insolvency Proceeding with respect to itself; or
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(iv) takes any action to effectuate or authorize any of the foregoing.
(g) INVOLUNTARY PROCEEDINGS. (i) Any involuntary Insolvency
Proceeding is commenced or filed against the Company or any Subsidiary, or any
writ, judgment, warrant of attachment, execution or similar process, is issued
or levied against a substantial part of the Company's or any Subsidiary's
properties, and such proceeding or petition shall not be dismissed, or such
writ, judgment, warrant of attachment, execution or similar process shall not be
released, vacated or fully bonded, within 60 days after commencement, filing or
levy; (ii) the Company or any Subsidiary admits the material allegations of a
petition against it in any Insolvency Proceeding, or an order for relief (or
similar order under non-U.S. law) is ordered in any Insolvency Proceeding; or
(iii) the Company or any Subsidiary acquiesces in the appointment of a receiver,
trustee, custodian, conservator, liquidator, mortgagee in possession (or agent
therefor), or other similar Person for itself or a substantial portion of its
property or business.
(h) ERISA. (i) An ERISA Event shall occur with respect to a Pension
Plan or Multiemployer Plan which has resulted or could reasonably be expected to
result in liability of the Company under Title IV of ERISA to the Pension Plan,
Multiemployer Plan or the PBGC in an aggregate amount in excess of $5,000,000
(or, in the case of a contribution failure sufficient to give rise to a Lien
under Section 302(f) of ERISA, in any amount); or (ii) the Company or any ERISA
Affiliate shall fail to pay when due, after the expiration of any applicable
grace period, any installment payment with respect to its withdrawal liability
under Section 4201 of ERISA under a Multiemployer Plan in an aggregate amount in
excess of $5,000,000.
(i) MONETARY JUDGMENTS. One or more non-interlocutory judgments,
non-interlocutory orders, decrees or arbitration awards is entered against the
Company or any Subsidiary involving in the aggregate a liability (to the extent
not covered by independent third-party insurance as to which the insurer does
not dispute coverage) as to any single or related series of transactions,
incidents or conditions, of $5,000,000 or more, and the same shall remain
unsatisfied, unvacated and unstayed pending appeal for a period of 30 days after
the entry thereof.
(j) NON-MONETARY JUDGMENTS. Any non-monetary judgment, order or
decree is entered against the Company or any Subsidiary which does or would
reasonably be expected to have a Material Adverse Effect, and there shall be any
period of 30 consecutive days during which a stay of enforcement of such
judgment or order, by reason of a pending appeal or otherwise, shall not be in
effect.
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(k) CHANGE OF CONTROL. A majority of the Board of Directors of the
Company shall not be Continuing Directors. For purposes of the foregoing,
"CONTINUING DIRECTORS" means, as of any date, (A) individuals who on the date
one year prior to such date were members of the Company's Board of Directors and
(B) any new Directors whose nomination for election by the Company's
shareholders was approved by a vote of at least a majority of the Directors on
the date of such nomination who either were Directors on the date one year prior
to the date of such nomination or whose nomination for election was previously
so approved.
(l) STANDSTILL AGREEMENT. Z/C shall fail to comply with the
Standstill Agreement.
(m) SECURITY AGREEMENT, ETC. The Security Agreement or the Trademark
Security Agreement shall cease to be in full force and effect; or the Company,
or any Person by, through or on behalf of the Company, shall contest the
validity or enforceability of the Security Agreement or the Trademark Security
Agreement.
9.2 REMEDIES. If any Event of Default occurs, the Agent shall, at the
request of, or may, with the consent of, the Majority Lenders do any or all of
the following:
(a) declare the commitment of each Lender to make Loans and any
obligation of the Issuing Lender to Issue Letters of Credit to be terminated,
whereupon such commitments and obligation shall be terminated;
(b) declare an amount equal to the maximum aggregate amount that is
or at any time thereafter may become available for drawing under any outstanding
Letters of Credit (whether or not any beneficiary shall have presented, or shall
be entitled at such time to present, the drafts or other documents required to
draw under such Letters of Credit) to be immediately due and payable, and
declare the unpaid principal amount of all outstanding Loans, all interest
accrued and unpaid thereon, and all other amounts owing or payable hereunder or
under any other Loan Document to be immediately due and payable, without
presentment, demand, protest or other notice of any kind, all of which are
hereby expressly waived by the Company; and
(c) exercise on behalf of itself and the Lenders all rights and
remedies available to it and the Lenders under the Loan Documents or applicable
law;
PROVIDED, HOWEVER, that upon the occurrence of any event specified in SUBSECTION
(f) or (g) of SECTION 9.1 (in the case of CLAUSE (i) of SUBSECTION (g) upon the
expiration of the 60-day period mentioned therein), the obligation of each
Lender to make Loans and any obligation of the Issuing Lender to Issue Letters
of Credit shall automatically terminate and the unpaid principal amount of all
outstanding Loans and all interest and other
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amounts as aforesaid shall automatically become due and payable without
further act of the Agent, the Issuing Lender or any Lender.
9.3 RIGHTS NOT EXCLUSIVE. The rights provided for in this Agreement and
the other Loan Documents are cumulative and are not exclusive of any other
right, power, privilege or remedy provided by law or in equity, or under any
other instrument, document or agreement now existing or hereafter arising.
ARTICLE X
THE AGENT
10.1 APPOINTMENT AND AUTHORIZATION. (a) Each Lender hereby irrevocably
(subject to SECTION 10.9) appoints, designates and authorizes the Agent to take
such action on its behalf under the provisions of this Agreement and each other
Loan Document and to exercise such powers and perform such duties as are
expressly delegated to it by the terms of this Agreement or any other Loan
Document, together with such powers as are reasonably incidental thereto.
Notwithstanding any provision to the contrary contained elsewhere in this
Agreement or in any other Loan Document, the Agent shall not have any duties or
responsibilities, except those expressly set forth herein, nor shall the Agent
have or be deemed to have any fiduciary relationship with any Lender, and no
implied covenants, functions, responsibilities, duties, obligations or
liabilities shall be read into this Agreement or any other Loan Document or
otherwise exist against the Agent.
(b) The Issuing Lender shall act on behalf of the Lenders with
respect to any Letters of Credit Issued by it and the documents associated
therewith until such time and except for so long as the Agent may agree at the
request of the Majority Lenders to act for such Issuing Lender with respect
thereto; PROVIDED, HOWEVER, that the Issuing Lender shall have all of the
benefits and immunities (i) provided to the Agent in this ARTICLE X with respect
to any acts taken or omissions suffered by the Issuing Lender in connection with
Letters of Credit Issued by it or proposed to be Issued by it and the
application and agreements for letters of credit pertaining to the Letters of
Credit as fully as if the term "Agent", as used in this ARTICLE X, included the
Issuing Lender with respect to such acts or omissions, and (ii) as additionally
provided in this Agreement with respect to the Issuing Lender.
10.2 DELEGATION OF DUTIES. The Agent may execute any of its duties under
this Agreement or any other Loan Document by or through agents, employees 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 agent or attorney-in-fact that it selects with
reasonable care.
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10.3 LIABILITY OF AGENT. None of the Agent-Related Persons shall (i) be
liable for any action taken or omitted to be taken by any of them under or in
connection with this Agreement or any other Loan Document or the transactions
contemplated hereby (except for its own gross negligence or willful misconduct),
or (ii) be responsible in any manner to any of the Lenders for any recital,
statement, representation or warranty made by the Company or any Subsidiary or
Affiliate of the Company, or any officer thereof, contained in this Agreement or
in any other Loan Document, or in any certificate, report, statement or other
document referred to or provided for in, or received by the Agent under or in
connection with, this Agreement or any other Loan Document, or the validity,
effectiveness, genuineness, enforceability or sufficiency of this Agreement or
any other Loan Document, or for any failure of the Company or any other party to
any Loan Document to perform its obligations hereunder or thereunder. No
Agent-Related Person shall be under any obligation to any Lender to ascertain or
to inquire as to the observance or performance of any of the agreements
contained in, or conditions of, this Agreement or any other Loan Document, or to
inspect the properties, books or records of the Company or any of the Company's
Subsidiaries or Affiliates.
10.4 RELIANCE BY AGENT. (a) The Agent shall be entitled to rely, and
shall be fully protected in relying, upon any writing, resolution, notice,
consent, certificate, affidavit, letter, telegram, facsimile, telex or telephone
message, statement 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 counsel
to the Company), independent accountants and other experts selected by the
Agent. The Agent shall be fully justified in failing or refusing to take any
action under this Agreement or any other Loan Document unless it shall first
receive such advice or concurrence of the Majority Lenders as it deems
appropriate and, if it so requests, it shall first be indemnified to its
satisfaction by the Lenders against any and all liability and expense which may
be incurred by it by reason of taking or continuing to take any such action.
The Agent shall in all cases be fully protected in acting, or in refraining from
acting, under this Agreement or any other Loan Document in accordance with a
request or consent of the Majority Lenders, and such request and any action
taken or failure to act pursuant thereto shall be binding upon all of the
Lenders.
(b) For purposes of determining compliance with the conditions
specified in SECTION 5.1, each Lender that has executed this Agreement shall be
deemed to have consented to, approved or accepted or to be satisfied with, each
document or other matter either sent by the Agent to such Lender for consent,
approval, acceptance or satisfaction, or required thereunder to be consented to
or approved by or acceptable or satisfactory to such Lender.
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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, except with respect
to defaults in the payment of principal, interest and fees required to be paid
to the Agent for the account of the Lenders, unless the Agent shall have
received written notice from a Lender or the Company referring to this
Agreement, describing such Default or Event of Default and stating that such
notice is a "notice of default". The Agent will notify the Lenders of its
receipt of any such notice. The Agent shall take such action with respect to
such Default or Event of Default as may be requested by the Majority Lenders in
accordance with ARTICLE IX; PROVIDED, HOWEVER, that unless and until the Agent
has received any such request, the Agent may (but shall not be obligated to)
take such action, or refrain from taking such action, with respect to such
Default or Event of Default as it shall deem advisable or in the best interest
of the Lenders.
10.6 CREDIT DECISION. Each Lender acknowledges that none of the
Agent-Related Persons has made any representation or warranty to it, and that no
act by the Agent hereinafter taken, including any review of the affairs of the
Company and its Subsidiaries, shall be deemed to constitute any representation
or warranty by any Agent-Related Person to any Lender. Each Lender represents
to the Agent that it has, independently and without reliance upon any Agent-
Related Person and based on such documents and information as it has deemed
appropriate, made its own appraisal of and investigation into the business,
prospects, operations, property, financial and other condition and
creditworthiness of the Company and its Subsidiaries, and all applicable bank
regulatory laws relating to the transactions contemplated hereby, and made its
own decision to enter into this Agreement and to extend credit to the Company
hereunder. Each Lender also represents that it will, independently and without
reliance upon any Agent-Related Person and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit analysis, appraisals and decisions in taking or not taking action under
this Agreement and the other Loan Documents, and to make such investigations as
it deems necessary to inform itself as to the business, prospects, operations,
property, financial and other condition and creditworthiness of the Company.
Except for notices, reports and other documents expressly herein required to be
furnished to the Lenders by the Agent, the Agent shall not have any duty or
responsibility to provide any Lender with any credit or other information
concerning the business, prospects, operations, property, financial and other
condition or creditworthiness of the Company which may come into the possession
of any of the Agent-Related Persons.
10.7 INDEMNIFICATION OF AGENT. Whether or not the transactions
contemplated hereby are consummated, the Lenders shall indemnify upon demand the
Agent-Related Persons (to the extent not reimbursed by or on behalf of the
Company and without limiting the obligation of the Company to do so), pro rata,
from
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and against any and all Indemnified Liabilities; PROVIDED, HOWEVER, that no
Lender shall be liable for the payment to any Agent-Related Person of any
portion of the Indemnified Liabilities resulting solely from such Person's gross
negligence or willful misconduct. Without limitation of the foregoing, each
Lender shall reimburse the Agent upon demand for its ratable share of any costs
or out-of-pocket expenses (including Attorney Costs) incurred by the Agent in
connection with the preparation, execution, delivery, administration,
modification, amendment or enforcement (whether through negotiations, legal
proceedings or otherwise) of, or legal advice in respect of rights or
responsibilities under, this Agreement, any other Loan Document, or any document
contemplated by or referred to herein, to the extent that the Agent is not
reimbursed for such expenses by or on behalf of the Company. The undertaking in
this Section shall survive the payment of all Obligations hereunder and the
resignation or replacement of the Agent.
10.8 AGENT IN INDIVIDUAL CAPACITY. BofA and its Affiliates may make loans
to, issue letters of credit for the account of, accept deposits from, acquire
equity interests in and generally engage in any kind of banking, trust,
financial advisory, underwriting or other business with the Company and its
Subsidiaries and Affiliates as though BofA were not the Agent hereunder and
without notice to or consent of the Lenders. The Lenders acknowledge that,
pursuant to such activities, BofA or its Affiliates may receive information
regarding the Company or its Affiliates (including information that may be
subject to confidentiality obligations in favor of the Company or such
Subsidiary) and acknowledge that the Agent shall be under no obligation to
provide such information to them. With respect to its Loans, BofA shall have
the same rights and powers under this Agreement as any other Lender and may
exercise the same as though it were not the Agent.
10.9 SUCCESSOR AGENT. The Agent may, and at the request of the Majority
Lenders shall, resign as Agent upon 30 days' notice to the Lenders. If the
Agent resigns under this Agreement, the Majority Lenders shall appoint from
among the Lenders a successor agent for the Lenders, which successor agent
shall, so long as no Default or Event of Default exists, be subject to the
approval of the Company (such approval not to be unreasonably withheld or
delayed). If no successor agent is appointed prior to the effective date of the
resignation of the Agent, the Agent may appoint, after consulting with the
Lenders and the Company, a successor agent from among the Lenders. Upon the
acceptance of its appointment as successor agent hereunder, such successor agent
shall succeed to all the rights, powers and duties of the retiring Agent and the
term "Agent" shall mean such successor agent and the retiring Agent's
appointment, powers and duties as Agent shall be terminated. After any retiring
Agent's resignation hereunder as Agent, the provisions of this ARTICLE X and
SECTIONS 11.4 and 11.5 shall inure to its benefit as to any actions taken or
omitted to be taken by it while it was Agent under this Agreement. If no
successor agent has accepted appointment as
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Agent by the date which is 30 days following a retiring Agent's notice of
resignation, the retiring Agent's resignation shall nevertheless thereupon
become effective and the Lenders shall perform all of the duties of the Agent
hereunder until such time, if any, as the Majority Lenders appoint a successor
agent as provided for above. Notwithstanding the foregoing, however, BofA may
not be removed as the Agent at the request of the Majority Lenders unless any
Affiliate of BofA acting as Issuing Lender or Swingline Lender hereunder shall
also simultaneously be replaced as Issuing Lender and Swingline Lender,
respectively, pursuant to documentation in form and substance reasonably
satisfactory to BofA and any such Affiliate.
10.10 WITHHOLDING TAX. (a) If any Lender is a "foreign corporation,
partnership or trust" within the meaning of the Code and such Lender claims
exemption from, or a reduction of, U.S. withholding tax under Section 1441 or
1442 of the Code, such Lender shall deliver to the Agent and the Company:
(i) if such Lender claims an exemption from, or a reduction of,
withholding tax under a United States tax treaty, properly completed IRS
Forms 1001 and W-8 before the payment of any interest in the first calendar
year and before the payment of any interest in each third succeeding
calendar year during which interest may be paid under this Agreement;
(ii) if such Lender claims that interest paid under this
Agreement is exempt from United States withholding tax because it is
effectively connected with a United States trade or business of such
Lender, two properly completed and executed copies of IRS Form 4224 before
the payment of any interest is due in the first taxable year of such Lender
and in each succeeding taxable year of such Lender during which interest
may be paid under this Agreement, and IRS Form W-9; and
(iii) such other form or forms as may be required under the Code
or other laws of the United States as a condition to exemption from, or
reduction of, United States withholding tax.
Each such Lender agrees to notify the Agent and the Company promptly of any
change in circumstances which would modify or render invalid any claimed
exemption or reduction.
(b) If any Lender claims exemption from, or reduction of, withholding
tax under a United States tax treaty by providing IRS Form 1001 and such Lender
sells, assigns, grants a participation in, or otherwise transfers all or part of
the Obligations of the Company to such Lender, such Lender agrees to notify the
Agent and the Company of the percentage amount in which it is no longer the
beneficial owner of Obligations of the Company to such Lender. To the extent of
such percentage amount,
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the Agent and the Company will treat such Lender's IRS Form 1001 as no longer
valid.
(c) If any Lender claiming exemption from United States withholding
tax by filing IRS Form 4224 with the Agent and the Company sells, assigns,
grants a participation in, or otherwise transfers all or part of the Obligations
of the Company to such Lender, such Lender agrees to undertake sole
responsibility for complying with the withholding tax requirements imposed by
Sections 1441 and 1442 of the Code.
(d) If any Lender is entitled to a reduction in the applicable
withholding tax, the Agent or the Company may withhold from any interest payment
to such Lender an amount equivalent to the applicable withholding tax after
taking into account such reduction. If the forms or other documentation
required by SUBSECTION (a) of this Section are not delivered to the Agent or the
Company, then the Agent or the Company may withhold from any interest payment to
such Lender not providing such forms or other documentation an amount equivalent
to the applicable withholding tax.
(e) If the IRS or any other Governmental Authority of the United
States or other jurisdiction asserts a claim that the Agent or the Company did
not properly withhold tax from amounts paid to or for the account of any Lender
(because the appropriate form was not delivered or was not properly executed, or
because such Lender failed to notify the Agent of a change in circumstances
which rendered the exemption from, or reduction of, withholding tax ineffective,
or for any other reason), such Lender shall indemnify the Agent or the Company
fully for all amounts paid, directly or indirectly, by the Agent or the Company
as tax or otherwise, including penalties and interest, and including any taxes
imposed by any jurisdiction on the amounts payable to the Agent or the Company
under this Section, together with all costs and expenses (including Attorney
Costs). The obligation of the Lenders under this subsection shall survive the
payment of all Obligations and the resignation or replacement of the Agent.
ARTICLE XI
MISCELLANEOUS
11.1 AMENDMENTS AND WAIVERS. No amendment or waiver of any provision of
this Agreement or any other Loan Document, and no consent with respect to any
departure by the Company therefrom, shall be effective unless the same shall be
in writing and signed by the Majority Lenders (or by the Agent at the written
request of the Majority Lenders) and the Company and acknowledged by the Agent,
and then any such waiver or consent shall be effective only in the specific
instance and for the specific purpose for which given; PROVIDED, HOWEVER, that
no such waiver, amendment, or consent shall, unless in writing and signed by all
of the
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Lenders and the Company and acknowledged by the Agent, do any of the following:
(a) increase or extend the Commitment of any Lender (or reinstate any
Commitment terminated pursuant to SECTION 9.2);
(b) postpone or delay any date fixed by this Agreement or any other
Loan Document for any payment of principal, interest, fees or other amounts due
to the Lenders (or any of them) hereunder or under any other Loan Document;
(c) reduce the principal of, or the rate of interest specified herein
on, any Loan, or (subject to CLAUSE (iv) below) reduce any fees or other amounts
payable hereunder or under any other Loan Document;
(d) change the percentage of the Commitments or of the aggregate
unpaid principal amount of the Loans which is required for the Lenders or any of
them to take any action hereunder;
(e) release all or substantially all of the collateral granted under
the Security Agreement or the Trademark Security Agreement; or
(f) amend this Section, or SECTION 2.15, or any provision herein
providing for consent or other action by all Lenders;
and PROVIDED, FURTHER, that (i) no amendment, waiver or consent shall, unless in
writing and signed by the Issuing Lender in addition to the Majority Lenders or
all the Lenders, as the case may be, affect the rights or duties of the Issuing
Lender under this Agreement or any L/C-Related Document relating to any Letter
of Credit Issued or to be Issued by it, (ii) no amendment, waiver or consent
shall, unless in writing and signed by the Swingline Lender in addition to the
Majority Lenders or all Lenders, as the case may be, affect the rights and
duties of the Swingline Lender under this Agreement, (iii) no amendment, waiver
or consent shall, unless in writing and signed by the Agent in addition to the
Majority Lenders or all the Lenders, as the case may be, affect the rights or
duties of the Agent under this Agreement or any other Loan Document, and (iv)
the Fee Letter may be amended, or rights or privileges thereunder waived, in a
writing executed by the parties thereto.
11.2 NOTICES. (a) All notices, requests and other communications
hereunder shall be in writing (including, unless the context expressly otherwise
provides, by facsimile transmission, provided that any matter transmitted by the
Company by facsimile (i) shall be immediately confirmed by a telephone call to
the recipient at the number specified on SCHEDULE 11.2 and (ii) shall be
followed promptly by delivery of a hard copy original thereof) and mailed, faxed
or delivered to the address or facsimile number specified for notices on
SCHEDULE 11.2; or,
73
<PAGE>
as directed to the Company or the Agent, to such other address as shall be
designated by such party in a written notice to the other parties, and as
directed to any other party, at such other address as shall be designated by
such party in a written notice to the Company and the Agent.
(b) All such notices, requests and communications shall, when
transmitted by overnight delivery, or faxed, be effective when delivered, or
received in legible form by facsimile machine, respectively, or if mailed, upon
the third Business Day after the date deposited into the U.S. mail, or if
delivered, upon delivery; except that notices pursuant to ARTICLE II, III or X
to the Agent shall not be effective until actually received by the Agent, and
notices pursuant to ARTICLE III to the Issuing Lender shall not be effective
until actually received by the Issuing Lender at the address specified for the
"Issuing Lender" on SCHEDULE 11.2.
(c) Any agreement of the Agent and the Lenders herein to receive
certain notices by telephone or facsimile is solely for the convenience and at
the request of the Company. The Agent and the Lenders shall be entitled to rely
on the authority of any Person purporting to be a Person authorized by the
Company to give such notice, and the Agent and the Lenders shall not have any
liability to the Company or any other Person on account of any action taken or
not taken by the Agent or the Lenders in reliance upon such telephonic or
facsimile notice. The obligation of the Company to repay the Loans and L/C
Obligations shall not be affected in any way or to any extent by any failure of
the Agent and the Lenders to receive written confirmation of any telephonic or
facsimile notice or the receipt by the Agent and the Lenders of a confirmation
which is at variance with the terms understood by the Agent and the Lenders to
be contained in the telephonic or facsimile notice.
11.3 NO WAIVER; CUMULATIVE REMEDIES. No failure to exercise and no delay
in exercising, on the part of the Agent or any Lender, any right, remedy, power
or privilege hereunder shall operate as a waiver thereof; nor shall any single
or partial exercise of any right, remedy, power or privilege hereunder preclude
any other or further exercise thereof or the exercise of any other right,
remedy, power or privilege.
11.4 COSTS AND EXPENSES. The Company shall:
(a) whether or not the transactions contemplated hereby are
consummated, pay or reimburse BofA (including in its capacity as Agent) and its
Affiliates (including Seafirst in its capacity as Swingline Lender, BAI in its
capacity as Issuing Lender and BA Securities, Inc. in its capacity as Arranger)
within five Business Days after demand (subject to SUBSECTION 5.1(e)) for all
costs and expenses incurred by BofA and its Affiliates in connection with the
development, preparation, syndication, delivery, administration and execution
of, and any amendment, supplement, waiver or modification to (in each case,
74
<PAGE>
whether or not consummated), this Agreement, any other Loan Document and any
other document prepared in connection herewith or therewith, and the
consummation of the transactions contemplated hereby and thereby, including
reasonable Attorney Costs incurred by BofA and its Affiliates with respect
thereto; and
(b) pay or reimburse the Agent, the Arranger and each Lender within
five Business Days after demand (subject to SUBSECTION 5.1(e)) for all costs and
expenses (including Attorney Costs) incurred by them in connection with the
enforcement, attempted enforcement or preservation of any right or remedy under
this Agreement or any other Loan Document during the existence of an Event of
Default or after acceleration of the Loans (including in connection with any
"workout" or restructuring regarding the Loans, and including in any Insolvency
Proceeding or appellate proceeding).
11.5 COMPANY INDEMNIFICATION. Whether or not the transactions contemplated
hereby are consummated, the Company shall indemnify and hold the Agent-Related
Persons and each Lender and each of its respective officers, directors,
employees, counsel, agents and attorneys-in-fact (each, an "INDEMNIFIED PERSON")
harmless from and against any and all liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, charges, expenses and disbursements
(including Attorney Costs) of any kind or nature whatsoever which may at any
time (including at any time following repayment of the Loans, the termination of
the Letters of Credit and the termination, resignation or replacement of the
Agent or replacement of any Lender) be imposed on, incurred by or asserted
against any such Person in any way relating to or arising out of this Agreement
or any document contemplated by or referred to herein, or the transactions
contemplated hereby or thereby, or any action taken or omitted by any such
Person under or in connection with any of the foregoing, including with respect
to any investigation, litigation or proceeding (including any Insolvency
Proceeding or appellate proceeding) related to or arising out of this Agreement
or the Loans or Letters of Credit or the use of the proceeds thereof, whether or
not any Indemnified Person is a party thereto (all the foregoing, collectively,
the "INDEMNIFIED LIABILITIES"); PROVIDED, that the Company shall have no
obligation hereunder to any Indemnified Person with respect to Indemnified
Liabilities resulting solely from the gross negligence or willful misconduct of
such Indemnified Person. The agreements in this Section shall survive payment of
all other Obligations.
11.6 PAYMENTS SET ASIDE. To the extent that the Company makes a payment to
the Agent or the Lenders, or the Agent or the Lenders exercise their right of
set-off, and such payment or the proceeds of such set-off or any part thereof is
subsequently invalidated, declared to be fraudulent or preferential, set aside
or required (including pursuant to any settlement entered into by the Agent or
such Lender in its discretion) to be repaid to a trustee, receiver or any other
party, in connection with any
75
<PAGE>
Insolvency Proceeding or otherwise, then (a) to the extent of such recovery the
obligation or part thereof originally intended to be satisfied shall be revived
and continued in full force and effect as if such payment had not been made or
such set-off had not occurred, and (b) each Lender severally agrees to pay to
the Agent upon demand its pro rata share of any amount so recovered from or
repaid by the Agent.
11.7 SUCCESSORS AND ASSIGNS. The provisions of this Agreement shall be
binding upon and inure to the benefit of the parties hereto and their respective
successors and assigns, except that the Company may not assign or transfer any
of its rights or obligations under this Agreement without the prior written
consent of the Agent and each Lender.
11.8 ASSIGNMENTS, PARTICIPATIONS, ETC. (a) Any Lender may, with the
written consent of the Agent, the Issuing Lender, the Swingline Lender and,
unless an Event of Default exists under SUBSECTION (a), (f) or (g) of SECTION
9.1 or any other Event of Default exists which has been continuing for 90
consecutive days, the Company (which consent of the Company shall not be
unreasonably withheld or delayed), at any time assign and delegate to one or
more Eligible Assignees (provided that no written consent of the Company, the
Agent, the Swingline Lender or the Issuing Lender shall be required in
connection with any assignment and delegation by a Lender to an Eligible
Assignee that is an Affiliate of such Lender or to another Lender) (each an
"ASSIGNEE") all, or any ratable part of all, of the Loans, the Commitment, the
L/C Obligations and the other rights and obligations of such Lender hereunder,
in a minimum amount of $10,000,000 (or, if less, the amount of such Lender's
Commitment); PROVIDED, HOWEVER, that the Company, the Issuing Lender, the
Swingline Lender and the Agent may continue to deal solely and directly with
such Lender in connection with the interest so assigned to an Assignee until (i)
written notice of such assignment, together with payment instructions, addresses
and related information with respect to the Assignee, shall have been given to
the Company and the Agent by such Lender and the Assignee; (ii) such Lender and
its Assignee shall have delivered to the Company and the Agent an Assignment and
Acceptance in the form of EXHIBIT F ("ASSIGNMENT AND ACCEPTANCE") together with
any Note or Notes subject to such assignment and (iii) the assignor Lender or
Assignee has paid to the Agent a processing fee in the amount of $3,500.
(b) From and after the date that the Agent notifies the assignor
Lender that it has received (and, to the extent required by SUBSECTION 11.8(a),
the Agent has given its consent, and has received the consents of the Company,
the Swingline Lender and the Issuing Lender, with respect to) an executed
Assignment and Acceptance and payment of the above-referenced processing fee,
(i) the Assignee thereunder shall be a party hereto and, to the extent that
rights and obligations hereunder have been assigned to it pursuant to such
Assignment and Acceptance, shall have the rights and obligations of a Lender
76
<PAGE>
under the Loan Documents, and (ii) the assignor Lender shall, to the extent that
rights and obligations hereunder and under the other Loan Documents have been
assigned by it pursuant to such Assignment and Acceptance, relinquish its rights
and be released from its obligations under the Loan Documents.
(c) Any Lender may at any time sell to one or more commercial banks
or other Persons not Affiliates of the Company (a "PARTICIPANT") participating
interests in any Loan, the Commitment of that Lender and the other interests of
that Lender (the "originating Lender") hereunder and under the other Loan
Documents; PROVIDED, HOWEVER, that (i) the originating Lender's obligations
under this Agreement shall remain unchanged, (ii) the originating Lender shall
remain solely responsible for the performance of such obligations, (iii) the
Company, the Issuing Lender, the Swingline Lender and the Agent shall continue
to deal solely and directly with the originating Lender in connection with the
originating Lender's rights and obligations under this Agreement and the other
Loan Documents, and (iv) no Lender shall transfer or grant any participating
interest under which the Participant has rights to approve any amendment to, or
any consent or waiver with respect to, this Agreement or any other Loan
Document, except to the extent such amendment, consent or waiver would (A)
increase or extend the obligation of such Participant to participate in any
Credit Extension hereunder, (B) postpone or delay any date fixed by this
Agreement or any other Loan Document for any payment of principal, interest,
fees or other amounts in which such Participant has a participating interest
hereunder or under any other Loan Document, (C) reduce the principal of, or the
rate of interest specified herein on, any Loan in which such Participant has a
participating interest or reduce any fee or other amount payable hereunder or
under any other Loan Document in which such Participant has a participating
interest, or (D) release all or substantially all of the collateral granted
under the Security Agreement or the Trademark Security Agreement. In the case of
any such participation, the Participant shall be entitled to the benefit of
SECTIONS 4.1, 4.3 and 11.5 as though it were also a Lender hereunder, and if
amounts outstanding under this Agreement are due and unpaid, or shall have been
declared or shall have become due and payable upon the occurrence of an Event of
Default, the Participant shall be deemed to have the right of set-off in respect
of its participating interest in amounts owing under this Agreement to the same
extent as if the amount of its participating interest were owing directly to it
as a Lender under this Agreement.
(d) Notwithstanding any other provision in this Agreement, any Lender
may at any time create a security interest in, or pledge, all or any portion of
its rights under and interest in this Agreement and any Note held by it in favor
of any Federal Reserve Bank in accordance with Regulation A of the FRB or U.S.
Treasury Regulation 31 CFR Section 203.14, and such Federal Reserve Bank may
enforce such pledge or security interest in any manner permitted under
applicable law.
77
<PAGE>
11.9 CONFIDENTIALITY. Each Lender agrees to take and to cause its
Affiliates to take normal and reasonable precautions and exercise due care to
maintain the confidentiality of all information provided to such Lender by the
Company or any Subsidiary, or by the Agent on the Company's or such Subsidiary's
behalf, under this Agreement or any other Loan Document, and neither such Lender
nor any of its Affiliates shall use any such information other than in
connection with or in enforcement of this Agreement and the other Loan Documents
or in connection with other business now or hereafter existing or contemplated
with the Company or any Subsidiary; except to the extent such information (i)
was or becomes generally available to the public other than as a result of
disclosure by such Lender or (ii) was or becomes available on a non-confidential
basis from a source other than the Company, provided that such source is not
bound by a confidentiality agreement with the Company or any Subsidiary known to
the Lender; PROVIDED, HOWEVER, that any Lender may disclose such information (A)
at the request or pursuant to any requirement of any Governmental Authority to
which the Lender is subject or in connection with an examination of such Lender
by any such authority; (B) pursuant to subpoena or other court process; (C) when
required to do so in accordance with the provisions of any applicable
Requirement of Law; (D) to the extent reasonably required in connection with any
litigation or proceeding to which the Agent or any Lender, or their respective
Affiliates, may be party; (E) to the extent reasonably required in connection
with the exercise of any remedy hereunder or under any other Loan Document; (F)
to such Lender's independent auditors and other professional advisors; (G) to
any Participant or Assignee, actual or potential, provided that such Person
agrees in writing to keep such information confidential to the same extent
required of the Lenders hereunder; (H) as to any Lender or its Affiliate, as
expressly permitted under the terms of any other document or agreement regarding
confidentiality to which the Company or any Subsidiary is party or is deemed
party with such Lender or such Affiliate; and (I) to its Affiliates.
11.10 SET-OFF. In addition to any right or remedy of the Lenders
provided by law, if any amount is due and payable to any Lender hereunder, such
Lender is authorized at any time and from time to time, without prior notice to
the Company, any such notice being waived by the Company to the fullest extent
permitted by law, to set off and apply any and all deposits (general or special,
time or demand, provisional or final) at any time held by, and other
indebtedness at any time owing by, such Lender to or for the credit or the
account of the Company against such amount, irrespective of whether or not the
Agent or such Lender shall have made demand under this Agreement or any Loan
Document. Each Lender agrees promptly to notify the Company and the Agent after
any such set-off and application made by such Lender; PROVIDED, HOWEVER, that
the failure to give such notice shall not affect the validity of such set-off
and application.
11.11 AUTOMATIC DEBITS OF FEES. With respect to any commitment fee,
arrangement fee, letter of credit fee or other
78
<PAGE>
fee due and payable to the Agent, the Issuing Lender, the Swingline Lender, BofA
or the Arranger under the Loan Documents, the Company hereby irrevocably
authorizes BofA (and, if requested by BofA, BAI and Seafirst) to debit any
deposit account of the Company with BofA, BAI or Seafirst in an amount such that
the aggregate amount debited from all such deposit accounts does not exceed such
fee or other cost or expense. If there are insufficient funds in such deposit
accounts to cover the amount of the fee or other cost or expense then due, such
debits will be reversed (in whole or in part, in BofA's sole discretion) and
such amount not debited shall be deemed to be unpaid. No such debit under this
Section shall be deemed a set-off.
11.12 NOTIFICATION OF ADDRESSES, LENDING OFFICES, ETC. Each Lender
shall notify the Agent in writing of any changes in the address to which notices
to such Lender should be directed, of addresses of any Lending Office, of
payment instructions in respect of all payments to be made to it hereunder and
of such other administrative information as the Agent shall reasonably request.
11.13 COUNTERPARTS. This Agreement may be executed in any number of
separate counterparts, each of which, when so executed, shall be deemed an
original, and all of which taken together shall be deemed to constitute but one
and the same instrument.
11.14 SEVERABILITY. The illegality or unenforceability of any
provision of this Agreement or any instrument or agreement required hereunder
shall not in any way affect or impair the legality or enforceability of the
remaining provisions of this Agreement or such instrument or agreement.
11.15 NO THIRD PARTIES BENEFITED. This Agreement is made and entered
into for the sole protection and legal benefit of the Company, the Lenders, the
Agent and the Agent-Related Persons, and their permitted successors and assigns,
and no other Person shall be a direct or indirect legal beneficiary of, or have
any direct or indirect cause of action or claim in connection with, this
Agreement or any of the other Loan Documents.
11.16 SUBSIDIARY REFERENCES. The provisions of this Agreement relating
to Subsidiaries of the Company shall apply only at such times as the Company has
one or more Subsidiaries; and the provision of this Agreement regarding
consolidated financial statements and covenants shall apply only at such times
as the Company has one or more consolidated subsidiaries.
11.17 GOVERNING LAW AND JURISDICTION. (a) THIS AGREEMENT AND ANY
NOTES SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE
STATE OF ILLINOIS.
(b) ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT OR
ANY OTHER LOAN DOCUMENT MAY BE BROUGHT IN THE COURTS OF THE STATE OF ILLINOIS OR
OF THE UNITED STATES FOR THE NORTHERN DISTRICT OF ILLINOIS, AND BY EXECUTION AND
DELIVERY OF
79
<PAGE>
THIS AGREEMENT, EACH OF THE COMPANY, THE AGENT AND THE LENDERS CONSENTS, FOR
ITSELF AND IN RESPECT OF ITS PROPERTY, TO THE NON-EXCLUSIVE JURISDICTION OF
THOSE COURTS. EACH OF THE COMPANY, THE AGENT AND THE LENDERS IRREVOCABLY WAIVES
ANY OBJECTION, INCLUDING ANY OBJECTION TO THE LAYING OF VENUE OR BASED ON THE
GROUNDS OF FORUM NON CONVENIENS, WHICH IT MAY NOW OR HEREAFTER HAVE TO THE
BRINGING OF ANY ACTION OR PROCEEDING IN SUCH JURISDICTION IN RESPECT OF THIS
AGREEMENT OR ANY DOCUMENT RELATED HERETO. THE COMPANY, THE AGENT AND THE
LENDERS EACH WAIVE PERSONAL SERVICE OF ANY SUMMONS, COMPLAINT OR OTHER PROCESS,
WHICH MAY BE MADE BY ANY OTHER MEANS PERMITTED BY ILLINOIS LAW.
11.18 WAIVER OF JURY TRIAL. THE COMPANY, THE LENDERS AND THE AGENT
EACH WAIVE THEIR RESPECTIVE RIGHT TO A TRIAL BY JURY OF ANY CLAIM OR CAUSE OF
ACTION BASED UPON OR ARISING OUT OF OR RELATED TO THIS AGREEMENT, THE OTHER LOAN
DOCUMENTS, OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY, IN ANY ACTION,
PROCEEDING OR OTHER LITIGATION OF ANY TYPE BROUGHT BY ANY OF THE PARTIES AGAINST
ANY OTHER PARTY OR ANY AGENT-RELATED PERSON, PARTICIPANT OR ASSIGNEE, WHETHER
WITH RESPECT TO CONTRACT CLAIMS, TORT CLAIMS, OR OTHERWISE. THE COMPANY, THE
LENDERS AND THE AGENT EACH AGREE THAT ANY SUCH CLAIM OR CAUSE OF ACTION SHALL BE
TRIED BY A COURT TRIAL WITHOUT A JURY. WITHOUT LIMITING THE FOREGOING, THE
PARTIES FURTHER AGREE THAT THEIR RESPECTIVE RIGHT TO A TRIAL BY JURY IS WAIVED
BY OPERATION OF THIS SECTION AS TO ANY ACTION, COUNTERCLAIM OR OTHER PROCEEDING
WHICH SEEKS, IN WHOLE OR IN PART, TO CHALLENGE THE VALIDITY OR ENFORCEABILITY OF
THIS AGREEMENT OR THE OTHER LOAN DOCUMENTS OR ANY PROVISION HEREOF OR THEREOF.
THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENT, RENEWAL, SUPPLEMENT OR
MODIFICATION TO THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS.
11.19 ENTIRE AGREEMENT. This Agreement, together with the other Loan
Documents, embodies the entire agreement and understanding among the Company,
the Lenders and the Agent, and supersedes all prior or contemporaneous
agreements and understandings of such Persons, verbal or written, relating to
the subject matter hereof and thereof.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered in Chicago, Illinois by their proper and duly
authorized officers as of the day and year first above written.
QUALITY FOOD CENTERS, INC.
By:
--------------------------
Title:
-----------------------
Address:
10116 N.E. 8th Street
Bellevue, Washington 98009
Attention: Marc Evanger
80
<PAGE>
Telephone: (206) 455-3761
Facsimile: (206) 462-2159
BANK OF AMERICA NATIONAL TRUST
AND SAVINGS ASSOCIATION,
as Agent
By:
--------------------------
Title:
-----------------------
SEATTLE FIRST NATIONAL BANK,
as Swingline Lender
By:
--------------------------
Title:
-----------------------
By:
--------------------------
Title:
-----------------------
81
<PAGE>
BANK OF AMERICA ILLINOIS,
as Issuing Lender
By:
--------------------------
Title:
-----------------------
BANK OF AMERICA ILLINOIS
By:
--------------------------
Title:
-----------------------
ABN AMRO BANK N.V.
By:
--------------------------
Title:
-----------------------
By:
--------------------------
Title:
-----------------------
THE FIRST NATIONAL BANK OF BOSTON
By:
--------------------------
Title:
-----------------------
BANQUE PARIBAS
By:
--------------------------
Title:
-----------------------
By:
--------------------------
Title:
-----------------------
CHEMICAL BANK
By:
--------------------------
Title:
-----------------------
82
<PAGE>
CITIBANK, N.A.
By:
--------------------------
Title:
-----------------------
FIRST BANK NATIONAL ASSOCIATION
By:
--------------------------
Title:
-----------------------
NATIONSBANK OF TEXAS, N.A.
By:
--------------------------
Title:
-----------------------
SEATTLE FIRST NATIONAL BANK
By:
--------------------------
Title:
-----------------------
U.S. BANK OF WASHINGTON, NATIONAL ASSOCIATION
By:
--------------------------
Title:
-----------------------
83
<PAGE>
SCHEDULE 1.1(a)
Pricing Schedule
------------------------------------
Case 1
- ----------------------------------------------------------------------------
Ratio of Funded Applicable
Debt to EBITDA Margin for
Offshore Rate Commitment
Loans Fee Rate
- ----------------------------------------------------------------------------
greater than 2.25:1 1.0% .30%
less than or equal to 2.25:1 but 1.0% .30%
greater than 1.50:1
- ---------------------------------------------------------------------------
less than or equal to 1.50:1 but .75% .25%
greater than 1.00:1
- ----------------------------------------------------------------------------
less than or equal to 1.00:1 .50% .225%
- ---------------------------------------------------------------------------
------------------------------------
Case 2
- ----------------------------------------------------------------------------
Ratio of Funded Applicable
Debt to EBITDA Margin for
Offshore Rate Commitment
Loans Fee Rate
- ----------------------------------------------------------------------------
greater than 2.25:1 1.25% .375%
- ----------------------------------------------------------------------------
less than or equal to 2.25:1 but 1.0% .30%
greater than 1.50:1
- ----------------------------------------------------------------------------
less than or equal to 1.50:1 but .75% .25%
greater than 1.00:1
- ----------------------------------------------------------------------------
less than or equal to 1.00:1 .50% .225%
- ----------------------------------------------------------------------------
The Applicable Margin and Commitment Fee Rate shall be adjusted, to the
extent applicable, 45 days (or, in the case of the last fiscal quarter of any
fiscal year, 90 days) after the end of each fiscal quarter based on the Funded
Debt to EBITDA Ratio as of the last day of such fiscal quarter (or, if
applicable, on September 15, 1995 based upon the Funded Debt to EBITDA Ratio as
of June 17, 1995); PROVIDED that if the Company fails to deliver the financial
statements required by SECTION 7.1 by the 45th day (or, if applicable, the 90th
day) after any fiscal quarter, the Applicable Margin and Commitment Fee Rate
that would apply if the Funded Debt to EBITDA Ratio were equal to or greater
than 2.25 to 1 shall apply until such financial statements are delivered.
<PAGE>
SCHEDULE 1.1(b)
COMMITMENTS
AND PRO RATA SHARE
<TABLE>
<CAPTION>
Pro Rata
Lender Commitment* Share
------ ---------- -----
<S> <C> <C>
Bank of America Illinois $ 25,000,000 11.363636365%
ABN-Amro Bank, N.V. $ 22,500,000 10.227272727%
The First National Bank of Boston $ 22,500,000 10.227272727%
Banque Paribas $ 22,500,000 10.227272727%
Chemical Bank $ 22,500,000 10.227272727%
Citibank, N.A. $ 22,500,000 10.227272727%
First Bank National Association $ 22,500,000 10.227272727%
Nationsbank of Texas, N.A. $ 22,500,000 10.227272727%
Seattle First National Bank $ 22,500,000 10.227272727%
U.S. Bank of Washington $ 15,000,000 6.818181819%
------------ -------------
Total $220,000,000 100.0%
<FN>
* Subject to reduction based upon amount of Revolving Commitment
and Term Commitment as determined pursuant to Schedule 2.1.
</TABLE>
<PAGE>
SCHEDULE 1.1(c)
PROPERTIES HELD FOR SALE
1. Northshore Shopping Center
2. Harbor Ridge Land
3. Mercer Island Shopping Center
4. Murphy's Corner Land
5. Wilderness Shopping Center
6. Klahanie Land
7. Totem Lake Pad
8. Stoneway Store Land
9. University Village (Dairy) - Real Estate
<PAGE>
SCHEDULE 2.1
AMOUNTS OF REVOLVING COMMITMENT AND TERM COMMITMENT
- ----------------------------------------------------------------------------
SHARES TERM REVOLVING
REPURCHASED COMMITMENT COMMITMENT
- ----------------------------------------------------------------------------
= 7.0MM $140MM $80MM
- ----------------------------------------------------------------------------
greater than or equal to 6.5 less than 7.0MM 130MM 80MM
- ----------------------------------------------------------------------------
greater than or equal to 6.0 less than 6.5MM 120MM 80MM
- ----------------------------------------------------------------------------
greater than or equal to 5.5 less than 6.0MM 110MM 80MM
- ----------------------------------------------------------------------------
greater than or equal to 5.0 less than 5.5MM 100MM 80MM
- ----------------------------------------------------------------------------
greater than or equal to 4.5 less than 5.0MM 90MM 80MM
- ----------------------------------------------------------------------------
greater than or equal to 4.0 less than 4.5MM 80MM 80MM
- ----------------------------------------------------------------------------
greater than or equal to 3.5 less than 4.0MM 70MM 80MM
- ----------------------------------------------------------------------------
greater than or equal to 3.0 less than 3.5MM 60MM 80MM
- ----------------------------------------------------------------------------
greater than or equal to 2.5 less than 3.0MM 50MM 80MM
- ----------------------------------------------------------------------------
greater than or equal to 2.0 less than 2.5MM 40MM 80MM
- ----------------------------------------------------------------------------
greater than or equal to 1.5 less than 2.0MM 0MM 105MM
- ----------------------------------------------------------------------------
greater than or equal to 1.0 less than 1.5MM 0MM 90MM
- ----------------------------------------------------------------------------
greater than or equal to 0.5 less than 1.0MM 0MM 75MM
- ----------------------------------------------------------------------------
greater than or equal to 0.0 less than 0.5MM 0MM 60MM
- ----------------------------------------------------------------------------
<PAGE>
SCHEDULE 2.9
REPAYMENT/REDUCTION DATES
<TABLE>
<CAPTION>
Quarterly
Term Loan Payment/
Repayment/Reduction Date Supplemental Revolver Reduction (1)
- ------------------------ -------------------------------
<S> <C>
3/22/97 4.50%
6/14/97 4.50%
9/6/97 4.50%
12/27/97 4.50%
3/21/98 4.50%
6/13/98 4.50%
9/5/98 4.50%
12/26/98 4.50%
3/20/99 5.25%
6/12/99 5.25%
9/4/99 5.25%
12/25/99 5.25%
3/18/00 6.25%
6/10/00 6.25%
9/2/00 6.25%
12/30/00 6.25%
3/24/01 6.00%
6/16/01 6.00%
9/8/01 6.00%
<FN>
- ---------------
(1) Percentage of original amount of Term Loan or, if applicable, of the
Supplemental Revolver Amount.
</TABLE>
<PAGE>
SCHEDULE 6.5
LITIGATION
[None]
<PAGE>
SCHEDULE 6.7
ERISA
<PAGE>
SCHEDULE 6.11
LIABILITIES
[None]
<PAGE>
SCHEDULE 6.12
ENVIRONMENTAL MATTERS
<PAGE>
SCHEDULE 6.16
SUBSIDIARIES AND MINORITY INTERESTS
[None]
<PAGE>
SCHEDULE 6.17
INSURANCE MATTERS
<PAGE>
SCHEDULE 8.1
LIENS
<PAGE>
SCHEDULE 8.4
INDEBTEDNESS
Real estate contract with Albert F. Scott and Dorothy Mae Scott dated July 5,
1989 for $120,000, due July 5, 1999 at 11% per annum.
Balance at March 15, 1995 $68,125.96
<PAGE>
SCHEDULE 8.7
CONTINGENT OBLIGATIONS
<PAGE>
SCHEDULE 8.14
NET WORTH BASE LEVEL
- ----------------------------------------------------------------------------
SHARES NET WORTH
REPURCHASED BASE LEVEL
(IN MILLIONS)
- ----------------------------------------------------------------------------
= 7.0MM $18
- ----------------------------------------------------------------------------
greater than or equal to 6.5 less than 7.0MM 18
- ----------------------------------------------------------------------------
greater than or equal to 6.0 less than 6.5MM 28
greater than or equal to 5.5 less than 6.0MM 38
- ----------------------------------------------------------------------------
greater than or equal to 5.0 less than 5.5MM 48
- ----------------------------------------------------------------------------
greater than or equal to 4.5 less than 5.0MM 58
- ----------------------------------------------------------------------------
greater than or equal to 4.0 less than 4.5MM 68
- ----------------------------------------------------------------------------
greater than or equal to 3.5 less than 4.0MM 78
- ----------------------------------------------------------------------------
greater than or equal to 3.0 less than 3.5MM 88
- ----------------------------------------------------------------------------
greater than or equal to 2.5 less than 3.0MM 98
- ----------------------------------------------------------------------------
greater than or equal to 2.0 less than 2.5MM 108
- ----------------------------------------------------------------------------
greater than or equal to 1.5 less than 2.0MM 118
- ----------------------------------------------------------------------------
greater than or equal to 1.0 less than 1.5MM 128
- ----------------------------------------------------------------------------
greater than or equal to 0.5 less than 1.0MM 138
- ----------------------------------------------------------------------------
greater than or equal to 0.0 less than 0.5MM 148
- ----------------------------------------------------------------------------
<PAGE>
SCHEDULE 11.2
Offshore and Domestic Lending Offices,
Addresses for Notices
BANK OF AMERICA NATIONAL TRUST
AND SAVINGS ASSOCIATION,
as Agent
Bank of America National Trust
and Savings Association
Agency Management Services #5596
1455 Market Street, 12th Floor
San Francisco, California 94103
Attention: Shannon Collins, Vice President
Telephone: (415) 953-0108
Facsimile: (415) 622-4894
Address for payments:
Bank of America National Trust
and Savings Association
ABA 121-000-358
Attention: Agency Management Services #5596
1850 Gateway Blvd.
Concord, CA 94520
For credit to Account No. 12331-14458
Ref: Quality Food Bancontrol
SEATTLE FIRST NATIONAL BANK,
as Swingline Lender
701 5th Avenue
Seattle, Washington 98104
Attention: Alice Stokke
Telephone: (206) 358-8009
Facsimile: (206) 358-3113
BANK OF AMERICA ILLINOIS,
as Issuing Lender
231 South LaSalle Street
Chicago, Illinois 60697
Attention: Lily Reyes
Telephone: (312) 828-3873
Facsimile: (312) 974-9626
<PAGE>
BANK OF AMERICA ILLINOIS,
as a Lender
231 South LaSalle Street
Chicago, Illinois 60697
Attention: Lily Reyes
Telephone: (312) 828-3873
Facsimile: (312) 974-9626
Domestic and Offshore Lending Office:
231 South LaSalle Street
Chicago, Illinois 60697
ABN AMRO BANK N.V.
For Credit Matters:
600 University Street
Suite 2323
Seattle, Washington 98101-2070
Attention: David McGinnis
Telephone: (206) 587-0342
Facsimile: (206) 682-5641
Domestic and Offshore Lending Office:
600 University Street
Suite 2323
Seattle, Washington 98101
Attention: Gillian Allen-White
Telephone: (206) 654-0365
Facsimile: (206) 682-5641
THE FIRST NATIONAL BANK OF BOSTON
100 Federal Street
Boston, Massachusetts 02110
Attention: Timothy Barns, Vice President
Telephone: (617) 434-7976
Facsimile: (617) 434-4929
BANQUE PARIBAS
227 West Monroe
Suite 3300
Chicago, Illinois 60606
Attention: Steven M. Heinen
Telephone: (312) 853-6036
Facsimile: (312) 853-6020
<PAGE>
CHEMICAL BANK
270 Park Avenue, 10th Floor
New York, New York 10017
Attention: Christopher Wardell
Telephone: (212) 270-2053
Facsimile: (212) 270-3860
With a copy to:
10 S. LaSalle Street
Chicago, Illinois 60602
Attention: Andrew Pasternak
Telephone: (312) 807-4057
Facsimile: (312) 443-1964
CITIBANK, N.A.
200 South Wacker Drive
Chicago, Illinois 60606
Attention: June Alkins
Telephone: (312) 993-3291
Facsimile: (312) 993-6838
FIRST BANK NATIONAL ASSOCIATION
601 Second Avenue South
Minneapolis, Minnesota 55402
Attention: Megan G. Mourning
Telephone: (612) 973-0087
Facsimile: (612) 973-0824
SEATTLE FIRST NATIONAL BANK
701 5th Avenue
Seattle, Washington 98104
Attention: Teresa Olson
Telephone: (206) 358-8002
Facsimile: (206) 358-3112
NATIONSBANK OF TEXAS, N.A.
901 Main Street
14th Floor
Dallas, Texas 75202
Attention: William B. Guffey
Telephone: (213) 236-4918
Facsimile: (213) 624-5815
<PAGE>
U.S. BANK OF WASHINGTON, NATIONAL ASSOCIATION
Commercial Loan Department
1415 Fifth Avenue
Fifth Floor
Seattle, Washington 98101
Attention: Lorrie Smith
Telephone: (206) 344-4696
Facsimile: (206) 587-7022
