FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
(Mark One)
X QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 1994
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
Commission File Number 1-9753
GEORGIA GULF CORPORATION
(Exact name of registrant as specified in its charter)
DELAWARE 58-1563799
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
400 Perimeter Center Terrace, Suite 595
Atlanta, Georgia 30346
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code:(404) 395-4500
Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months (or
for such shorter period that the registrant was required to file
such reports), and (2) has been subject to such filing requirements
for the past 90 days. Yes X No
Indicate the number of shares outstanding of each of the issuer's
classes of common stock, as of the latest practicable date.
Outstanding as of
Class May 1, 1994
Common Stock, $0.01 par value................41,244,051 shares
<PAGE>
GEORGIA GULF CORPORATION
FORM 10-Q
QUARTERLY PERIOD ENDED MARCH 31, 1994
INDEX
Page Numbers
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
Condensed Consolidated Balance Sheets
as of March 31, 1994 and
December 31, 1993 2
Condensed Consolidated Statements of
Income for the three months ended
March 31, 1994 and 1993 3
Condensed Consolidated Statements of
Cash Flows for the three months
ended March 31, 1994 and 1993 4
Notes to Condensed Consolidated Financial
Statements for March 31, 1994 5
Item 2. Management's Discussion and Analysis
of Financial Condition and Results
of Operations 6-7
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K 8
SIGNATURES 9
<PAGE>
PART I.FINANCIAL INFORMATION
Item 1. Financial Statements
<TABLE>
<CAPTION>
GEORGIA GULF CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands, except share data)
March 31, December 31,
1994 1993
<S> <C> <C>
ASSETS
Current assets
Cash and cash equivalents $ 3,077 $ 3,099
Receivables 104,969 96,068
Inventories 56,943 58,261
Prepaid expenses 9,473 10,350
Deferred income taxes 9,759 9,759
Total current assets 184,221 177,537
Property, plant and equipment, at cost 397,927 388,844
Less accumulated depreciation 172,952 166,009
Property, plant and equipment, net 224,975 222,835
Other assets 4,773 4,915
Total assets $ 413,969 $ 405,287
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
Current liabilities
Current portion of long-term debt $ 14,049 $ 14,049
Accounts payable 57,293 59,911
Interest payable 20,832 16,824
Accrued income taxes 4,942 3,129
Other accrued liabilities 19,726 15,950
Total current liabilities 116,842 109,863
Long-term debt 350,945 365,157
Deferred income taxes 40,844 40,844
Stockholders' equity (deficit)
Common stock - $0.01 par value 412 410
Additional paid-in capital 169,622 166,439
Retained earnings (deficit) (264,696) (277,426)
Total stockholders' equity (deficit) (94,662) (110,577)
Total liabilities and stockholders' equity (deficit) $ 413,969 $ 405,287
Common shares outstanding 41,219,101 40,951,571
See notes to condensed consolidated financial statements.<PAGE>
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
GEORGIA GULF CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(In thousands, except share data)
Three Months Ended
March 31,
1994 1993
<S> <C> <C>
Net sales $ 192,906 $ 181,906
Operating costs and expenses
Cost of sales 153,720 145,080
Selling and administrative 9,887 9,717
Total operating costs and expenses 163,607 154,797
Operating income 29,299 27,109
Other income (expense)
Interest, net (9,782) (11,891)
Income before income taxes, extraordinary charge
and cumulative effect of accounting change 19,517 15,218
Provision for income taxes 6,787 5,098
Income before extraordinary charge and cumulative
effect of accounting change 12,730 10,120
Extraordinary charge on early retirement of debt
(net of tax benefit of $6,834) -- (13,267)
Cumulative effect of accounting change for
income taxes -- 12,973
Net income $ 12,730 $ 9,826
Income per common share:
Before extraordinary charge and cumulative
effect of accounting change $ 0.30 $ 0.24
Extraordinary charge on early retirement of debt 0.00 (0.32)
Cumulative effect of accounting change for
income taxes 0.00 0.32
Net income per common share $ 0.30 $ 0.24
Weighted average common shares and equivalents
outstanding 42,169,692 41,602,335
See notes to condensed consolidated financial statements.<PAGE>
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
GEORGIA GULF CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(In thousands, except share data)
Three Months Ended Nine Months Ended
September 30, September 30,
1993 1992 1993 1992
<S> <C> <C> <C> <C>
Net sales $ 199,635 $ 199,690 $ 576,743 $ 582,296
Operating costs and expenses
Cost of sales 162,408 160,004 464,750 452,766
Selling and administrative 9,140 9,348 28,149 27,680
Total operating costs and expenses 171,548 169,352 492,899 480,446
Operating income 28,087 30,338 83,844 101,850
Other income (expense)
Interest, net (10,844) (14,349) (34,086) (47,033)
Income before income taxes, extraordinary charge
and cumulative effect of accounting change 17,243 15,989 49,758 54,817
Provision for income taxes 7,096 5,085 18,015 17,460
Income before extraordinary charge and cumulative
effect of accounting change 10,147 10,904 31,743 37,357
Extraordinary charge on early retirement of debt
(net of tax benefit of $6,834) -- -- (13,267) --
Cumulative effect of accounting change for
income taxes -- -- 12,973 --
Net income $ 10,147 $ 10,904 $ 31,449 $ 37,357
Income per common share:
Before extraordinary charge and cumulative
effect of accounting change $ 0.24 $ 0.26 $ 0.76 $ 0.97
Extraordinary charge on early retirement of debt 0.00 0.00 (0.32) 0.00
Cumulative effect of accounting change for
income taxes 0.00 0.00 0.32 0.00
Net income per common share $ 0.24 $ 0.26 $ 0.76 $ 0.97
Weighted average common shares and equivalents
outstanding 41,577,329 41,264,935 41,472,067 38,675,084
See notes to condensed consolidated financial statements.<PAGE>
GEORGIA GULF CORPORATION AND SUBSIDIARIES
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
Three Months Ended
March 31,
1994 1993
<S> <C> <C>
Cash flows from operating activities:
Net income $ 12,730 $ 9,826
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation 7,196 6,217
Amortization 179 703
Cost associated with early retirement of debt -- 20,101
Cumulative effect of accounting change for income taxes -- (12,973)
Change in assets, liabilities and other 1,225 (10,974)
Net cash provided by operating activities 21,330 12,900
Cash flows from financing activities:
Net change in revolving credit loan (10,700) 71,000
Principal payments on long-term debt (3,512) (227,335)
Proceeds from issuance of long-term debt -- 150,000
Proceeds from issuance of common stock 1,943 312
Net cash used in financing activities (12,269) (6,023)
Cash flows from investing activities:
Capital expenditures (9,083) (5,279)
Net cash used in investing activities (9,083) (5,279)
Net change in cash and cash equivalents (22) 1,598
Cash and cash equivalents at beginning of period 3,099 2,904
Cash and cash equivalents at end of period $ 3,077 $ 4,502
See notes to condensed consolidated financial statements.<PAGE>
NOTES TO CONDENSED CONSOLIDATED FINANCIAL
</TABLE>
<PAGE>
NOTE 1: BASIS OF PRESENTATION
The accompanying unaudited condensed consolidated financial
statements have been prepared in accordance with generally accepted
accounting principles for interim financial information and with
the instructions to Form 10-Q and Article 10 of Regulation S-X.
Accordingly, they do not include all of the information and
footnotes required by generally accepted accounting principles for
complete financial statements. In the opinion of management, all
adjustments (consisting of normal recurring accruals) considered
necessary for a fair presentation have been included.
Operating results for the three month period ended March 31, 1994,
are not necessarily indicative of the results that may be expected
for the year ending December 31, 1994. For further information,
refer to the consolidated financial statements and footnotes
thereto included in Georgia Gulf Corporation and its subsidiaries'
("the Company") annual report for the year ended December 31, 1993.
NOTE 2: INVENTORIES
The major classes of inventories were as follows (in thousands):
March 31, December 31,
1994 1993
Raw materials and supplies $ 23,425 $ 20,819
Finished goods 33,518 37,442
$ 56,943 $ 58,261
NOTE 3: SUBSEQUENT EVENT - SENIOR DEBT REFINANCED
The Company refinanced its senior debt on April 27, 1994, replacing
an existing revolving credit facility and $79,613,000 term loan
with an unsecured revolving credit facility permitting borrowings
of up to $250,000,000 through April 1999 (the "New Credit
Agreement"). On the closing date of the New Credit Agreement, the
Company had $182,000,000 outstanding under the revolving credit
facility. The terms and conditions of the New Credit Agreement
provide for reduced interest rates, less restrictive covenants and
increased financial flexibility. The new revolving credit facility
matures in April 1999, at which time any amounts outstanding
thereunder are payable in full. The costs incurred in connection
with the refinancing, including both the unamortized debt issuance
costs associated with the terminated credit facility and the costs
related to the New Credit Agreement, were not material.
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations
RESULTS OF OPERATIONS
For the first quarter ended March 31, 1994, net income per common
share was $0.30 on net income of $12.7 million and sales of $192.9
million. This compares to net income per common share of $0.24,
net income of $9.8 million and sales of $181.9 million for the
first quarter of 1993.
Operating income for the first quarter of 1994 was $29.3 million,
an increase of 8% from $27.1 million for the same period in 1993.
A significant factor contributing to this increase was the improved
profits from methanol, which more than offset lower results from
the Company's aromatic products. Overall, sales volumes increased
13%, which outpaced a slight decline in the average sales prices of
the Company's products.
Interest expense declined $2.1 million when comparing the first
quarter of 1994 to the same period in 1993. This decline was
attributable to $73.1 million of debt repayments over the past
twelve months from funds generated by operating activities.
During the first quarter of 1993, the Company incurred an
extraordinary charge of $13.3 million relating to a refinancing of
the Company's senior debt which was offset by a $13.0 million
benefit from a change in the method of accounting for income taxes.
The effective tax rate increased to 34.8% in 1994 from 33.5% in the
first quarter of 1993, principally due to the 1% increase of the
statutory federal income tax rate during the third quarter of 1993.
LIQUIDITY AND CAPITAL RESOURCES
During the three months ended March 31, 1994, $21.3 million of cash
was generated by operating activities as compared to $12.9 million
for the three months ended March 31, 1993. This increase was
attributable to an increase in net income and changes in working
capital, primarily inventories.
Debt was reduced by $14.2 million during the three months ended
March 31, 1994, to a level of $365.0 million, which consisted of
senior debt of $173.9 million and subordinated notes of $191.1
million. The senior debt was again refinanced on April 27, 1994,
which provides the Company with greater financial flexibility, less
restrictive covenants and lower interest rates. The new credit
agreement consists of an unsecured $250 million revolving credit
facility due in April of 1999. The costs associated with the
refinancing were not material.
Capital expenditures for the three months ended March 31, 1994,
were $9.1 million as compared to $5.3 million for the same 1993
period. This increase reflects the expenditures for a vinyl resin
plant expansion scheduled for completion by the fourth quarter of
1994. Capital expenditures are expected to total between $60 to
$70 million for 1994, including expenditures of approximately $40
million for the vinyl resin plant expansion.
The Company has not declared a dividend since December 1989. The
terms of the Company's new credit agreement and its outstanding
subordinated note indenture prevent the payment of dividends until
certain criteria are met.
Management believes that cash provided by operations and the
availability under the Company's revolving credit facility will
provide sufficient funds to support planned capital expenditures,
working capital and debt service requirements.
OUTLOOK
During the first quarter of 1994, the Company observed an
improvement in several market segments. Looking forward to the
second quarter, management has some concern over increases in raw
material pricing, particularly with aromatic chemicals. However,
the Company is hopeful that continued good demand for their
products will result in improved earnings for the coming months.
PART II.OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
a) The following exhibit is filed as part of this Form 10-Q
Quarterly Report:
Exhibit No. Description
10 Credit Agreement, dated April 27, 1994,
between the Company and The Chase Manhattan
Bank (National Association) as Adminis-
trative Agent.
b) No reports on Form 8-K were filed with the Securities and
Exchange Commission during the first quarter of 1994.<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, the registrant has duly caused this report to be signed on
its behalf by the undersigned thereunto duly authorized.
GEORGIA GULF CORPORATION
Date May 12, 1994 /s/ Jerry R. Satrum
Jerry R. Satrum
President and Chief
Executive Officer
(Principal Executive Officer)
Date May 12, 1994 /s/ Richard B. Marchese
Richard B. Marchese
Vice President - Finance and
Chief Financial Officer
(Principal Financial Officer)<PAGE>
<PAGE>
[EXHIBIT 10]
************************************************************
GEORGIA GULF CORPORATION
CREDIT AGREEMENT
Dated as of April 27, 1994
$250,000,000
THE CHASE MANHATTAN BANK
(NATIONAL ASSOCIATION)
as Administrative Agent
************************************************************
<PAGE>
TABLE OF CONTENTS
Page
RECITALS 1
Section 1 Definitions and Accounting Matters 1
1.01 Certain Defined Terms. . 1
1.02 Accounting Terms and Determinations. . . 19
1.03 Classes and Types of Loans . . 19
Section 2 Loans and Letters of Credit. . 20
2.01 Loans. . . 20
2.02 Letters of Credit. . 21
2.03 Reductions of Commitments. . . 27
2.04 Fees 28
2.05 Lending Offices. . . 30
2.06 Several Obligations. 30
2.07 Notes. . . 30
2.08 Use of Proceeds. . . 31
Section 3 Borrowings, Conversions and Prepayments. 31
3.01 Borrowings . . 31
3.02 Prepayments and Conversions. . 32
3.03 Money Market Loans . 32
Section 4 Payments of Principal and Interest 37
4.01 Repayment of Loans . 37
4.02 Interest . 37
Section 5 Payments; Pro Rata Treatment
Computations; Etc.. 39
5.01 Payments 39
5.02 Pro Rata Treatment 40
5.03 Computations 40
5.04 Minimum and Maximum Amounts; Types 40
5.05 Certain Notices. . . 41
5.06 Non-Receipt of Funds by the
Administrative Agent. . . 43
5.07 Sharing of Payments, Etc.. . . 43
Section 6 Yield Protection and Illegality. . 44
6.01 Additional Costs . . 44
6.02 Limitation on Types of Loans . 46
6.03 Illegality . . 47
6.04 Substitute Base Rate Loans . . 47
6.05 Compensation . 47
6.06 Additional Costs in Respect of
Letters of Credit . 48
6.07 Capital Adequacy . . 48
6.08 Substitution of Lender 49
Section 7 Conditions Precedent . . 49
7.01 Initial Loans and Letters
of Credit 49
7.02 Initial and Subsequent Loans and
Letters of Credit 51
Section 8 Representations and Warranties . . 51
8.01 Corporate Existence. 51
8.02 Information. . 52
8.03 Litigation . . 53
8.04 No Breach. 53
8.05 Corporate Action 54
8.06 Approvals. 54
8.07 Regulations U and X. 54
8.08 ERISA. . . 54
8.09 Taxes. . . 54
8.10 Subsidiaries . 55
8.11 Investment Company Act . 55
8.12 Public Utility Holding Company Act 55
8.13 Ownership and Use of Properties. . 55
8.14 Environmental Matters. . 55
8.15 Subordinated Debt. . 56
8.16 Existing Letters of Credit . . 56
Section 9 Covenants. 56
9.01 Reports. . 56
9.02 Taxes and Claims . . 59
9.03 Insurance. 59
9.04 Maintenance of Existence; Conduct
of Business . . 60
9.05 Maintenance of and Access to Properties. 60
9.06 Compliance with Applicable Laws. . 60
9.07 Litigation . . 60
9.08 Current Ratio. 61
9.09 Indebtedness . 61
9.10 Leverage Ratio 61
9.11 Interest Coverage Ratio. 61
9.12 Fixed Charges Coverage Ratio . 61
9.13 Mergers, Asset Dispositions and
Acquisitions, Etc.. 62
9.14 Liens. . . 64
9.15 Investments. . 64
9.16 Restricted Payments. 65
9.17 Transactions with Affiliates . 65
9.18 Subordinated Indebtedness. . . 66
9.19 Lines of Businesses. 66
9.20 Environmental Matters. . 66
Section 10 Defaults. 67
10.01 Events of Default. . 67
10.02 Collateral Account . 70
Section 11 The Administrative Agent. . . 71
11.01 Appointment, Powers and Immunities 71
11.02 Reliance by Administrative Agent . 72
11.03 Defaults . 72
11.04 Rights as a Lender . 73
11.05 Indemnification. . . 73
11.06 Non-Reliance on Administrative Agent
and Other Lenders . 73
11.07 Failure to Act 74
11.08 Resignation or Removal of
Administrative Agent. . . 74
11.09 Consents under Basic Documents . . 75
Section 12 Miscellaneous. . . 75
12.01 Waiver . . 75
12.02 Notices. . 75
12.03 Expenses, Etc. 76
12.04 Indemnification. . . 76
12.05 Amendments, Etc. . . 77
12.06 Successors and Assigns . 77
12.07 Confidentiality. . . 79
12.08 Survival . 79
12.09 Captions . 79
12.10 Counterparts; Integration. . . 79
12.11 GOVERNING LAW; SUBMISSION TO
JURISDICTION; WAIVER OF JURY TRIAL. 80
Schedules
SCHEDULE I - Subsidiaries
SCHEDULE II - Existing Letters of Credit
Exhibits
EXHIBIT A - Form of Working Capital Loan Note
EXHIBIT B - Form of Money Market Loan Note
EXHIBIT C - Form of Swing Loan Note
EXHIBIT D - Form of Money Market Quote Request
EXHIBIT E - Form of Money Market Quote
EXHIBIT F - Form of Closing Date Opinion of
Counsel to Company
EXHIBIT G - Form of Closing Date Opinion of
Special New York Counsel to the
Administrative Agent
<PAGE>
CREDIT AGREEMENT
CREDIT AGREEMENT dated as of April 27, 1994 among:
GEORGIA GULF CORPORATION, a corporation duly organized and validly
existing under the laws of the State of Delaware (together with its
successors, the "Company"); each of the lenders that is a signatory
hereto (individually a "Lender" and, collectively, the "Lenders");
and THE CHASE MANHATTAN BANK (NATIONAL ASSOCIATION), as
administrative agent for the Lenders (in such capacity, together
with its successors in such capacity, the "Administrative Agent").
The parties hereto agree as follows:
Section 1. Definitions and Accounting Matters.
1.01 Certain Defined Terms. As used herein, the
following terms shall have the following meanings (all terms
defined in this Section 1.01 or in other provisions of this
Agreement in the singular to have the same meanings when used in
the plural and vice versa):
"Additional Costs" shall have the meaning assigned to
such term in Section 6.01(a).
"Adjusted Capital Expenditures" shall mean, for any
period, the remainder of (i) Capital Expenditures made during such
period minus (ii) the principal amount (if any) of Indebtedness
(other than Indebtedness hereunder and Capital Lease Obligations)
incurred to finance Capital Expenditures during such period.
"Adjusted Cash Flow" shall mean, for any period, the sum
(without duplication), determined on a consolidated basis for the
Company and its Subsidiaries, of (i) Cash Flow for such period,
minus (ii) (to the extent not deducted in determining Cash Flow for
such period) current provision for income tax of the Company and
its Subsidiaries accrued during such period.
"Adjusted CD Rate", for any CD Loans, shall mean for the
Interest Period for such Loans a rate per annum determined by the
Administrative Agent pursuant to the following formula:
[ CDBR ]
ACDR = ______________ + AR
[ 1.00 - DRP ]
ACDR = Adjusted CD Rate
CDBR = CD Base Rate for the Interest
Period for such Loans (rounded
upward, if necessary, to the
next higher 1/100 of 1%)
DRP = Domestic Reserve Percentage
AR = Assessment Rate
"Affiliate" shall mean, as to any Person, any other
Person which directly or indirectly controls, or is under common
control with, or is controlled by, such Person and, if such Person
is an individual, any member of the immediate family (including
parents, siblings, spouse, children, stepchildren, nephews, nieces
and grandchildren) of such individual and any trust whose principal
beneficiary is such individual or one or more members of such
immediate family and any Person who is controlled by any such
member or trust. As used in this definition, "control" (including,
with correlative meanings, "controlled by" and "under common
control with") shall mean possession, directly or indirectly, of
power to direct or cause the direction of management or policies
(whether through ownership of securities or partnership or other
ownership interests, by contract or otherwise), provided that, in
any event, any Person which owns directly or indirectly more than
10% of the securities having ordinary voting power for the election
of directors or other governing body of a corporation or more than
10% of the partnership or other ownership interests of any other
Person (other than as a limited partner of such other Person) will
be deemed to control such corporation or other Person.
Notwithstanding the foregoing, no individual shall be deemed to be
an Affiliate of a corporation solely by reason of his or her being
an officer or director of such corporation, and no Subsidiary of
the Company shall be deemed to be an Affiliate of the Company or
any other Subsidiary of the Company.
"Agreement" shall mean this Credit Agreement, as amended
from time to time in accordance with the terms hereof.
"Applicable Lending Office" shall mean, for each Lender
and for each Type of Loan or Letter of Credit, the Lending Office
of such Lender (or of an affiliate of such Lender) designated for
such Type of Loan or Letter of Credit below its name on the
signature pages hereof or such other office of such Lender (or of
an affiliate of such Lender) as such Lender may from time to time
specify to the Administrative Agent and the Company as the office
by which its Loans of such Type or such Letters of Credit are to be
made and/or issued and maintained.
"Applicable Margin" shall mean, with respect to any
Working Capital Loan or Letter of Credit and during any Performance
Period (or portion thereof), the percentage indicated below
opposite the Applicable Pricing Ratio for such Performance Period
(or portion thereof) (determined, in the case of any Working
Capital Loan, as a function of the Type of such Loan):
<TABLE>
<CAPTION>
Applicable Base Eurodollar CD Letters
Pricing Rate Loans Loans of Credit
Ratio Loans
<S> <C> <C> <C> <C>
Greater than 3.75:1 0.00 1.00 1.125 0.75
Less than or equal to
3.75:1 but greater
than 2.5:1 0.00 0.70 0.825 0.45
Less than or equal
to 2.5:1 but
greater than 1.5:1 0.00 0.625 0.75 0.375
Less than or equal
to 1.5:1 0.00 0.55 0.675 0.300
</TABLE>
The Applicable Margin for Swing Loans shall be the Applicable
Margin specified above for Base Rate Loans and the Applicable
Margin for Swing Letters of Credit shall be the Applicable Margin
specified above for Eurodollar Loans, or (in either case) such
other rate per annum as the Company and Chase may agree from time
to time.
"Applicable Pricing Ratio" shall mean, for any
Performance Period the ratio of (x) Indebtedness of the Company and
its consolidated subsidiaries, determined on a consolidated basis
as at the end of the fiscal quarter (the "statement quarter") to
which the financial statements received by the Administrative Agent
on the first day of such Performance Period (or in the case of the
first Performance Period, most recently received prior to the
Closing Date) relate, to (y) the sum of (i) net operating income of
the Company and its Subsidiaries (calculated as specified in clause
(i) of the definition of Cash Flow) for the period of four fiscal
quarters ending at the end of the statement quarter and (ii)
amortization expense (to the extent deducted in determining net
operating income) for such period, as set forth in a certificate of
the chief financial officer or corporate controller of the Company
delivered to the Administrative Agent on the first day of such
Performance Period, provided that the Applicable Pricing Ratio for
any portion of any Performance Period that occurs on or after the
45th day following the end of the fiscal quarter of the Company
during which such Performance Period commenced shall be deemed to
be greater than 3.75:1.0
"Assessment Rate" shall mean, for any day, the annual
assessment rate in effect on such day which is payable by a member
of the Bank Insurance Fund classified as adequately capitalized and
within supervisory subgroup "A" (or a comparable successor
assessment risk classification) within the meaning of 12 C.F.R.
Section 327.3(d) (or any successor provision) to the Federal Deposit
Insurance Corporation (or any successor) for such Corporation's (or
such successor's) insuring time deposits at offices of such
institution in the United States. The Adjusted CD Rate shall be
adjusted automatically on and as of the effective date of any
change in the Assessment Rate.
"Bankruptcy Code" shall mean the United States Bankruptcy
Code, as now or hereafter in effect, or any successor statute.
"Base Rate" shall mean, with respect to any Base Rate
Loan for any day, the rate per annum equal to the higher as of such
day of (i) the Federal Funds Rate plus 1/2 of 1% or (ii) the Prime
Rate.
"Base Rate Loans" shall mean Loans which bear interest at
a rate based upon the Base Rate.
"Basic Documents" shall mean this Agreement, the Notes
and any instruments evidencing or agreements providing for the
issuance of Subordinated Indebtedness.
"Business Day" shall mean any day other than a day on
which commercial banks are authorized or required to close in New
York City and, where such term is used in the definition of
"Quarterly Date" in this Section 1.01 or if such day relates to the
giving of notices or quotes in connection with a LIBOR Auction, a
borrowing of, a payment or prepayment of principal of or interest
on, a conversion of or into, or an Interest Period for, a
Eurodollar Loan or a LIBOR Market Loan or a notice by the Company
with respect to any such borrowing, payment, prepayment, conversion
or Interest Period, which is also a day on which dealings in Dollar
deposits are carried out in the London interbank market.
"Capital Expenditures" shall mean expenditures in respect
of fixed or capital assets by the Company or any of its
Subsidiaries, including the capital portion of lease payments made
in respect of Capital Lease Obligations, but excluding expenditures
for the restoration or replacement of fixed assets to the extent
financed by the proceeds of an insurance policy described in clause
(1) of Section 9.03 hereof.
"Capital Lease Obligations" shall mean, as to any Person,
the obligations of such Person to pay rent or other amounts under
a lease of (or other agreement conveying the right to use) real
and/or personal property which obligations are required to be
classified and accounted for as a capital lease on a balance sheet
of such Person under GAAP (including Statement of Financial
Accounting Standards No. 13 of the Financial Accounting Standards
Board) and, for purposes of this Agreement, the amount of such
obligations shall be the capitalized amount thereof, determined in
accordance with GAAP (including such Statement No. 13).
"Cash Flow" shall mean, for any period, the sum (without
duplication), determined on a consolidated basis for the Company
and its Subsidiaries, of (i) net operating income of the Company
and its Subsidiaries (calculated before provision for income taxes,
interest expense, extraordinary items and income attributable to
equity in affiliates) for such period plus (ii) depreciation,
amortization and other non-cash items (to the extent deducted in
determining operating income) for such period plus (iii) accrued
interest income (to the extent not included in determining
operating income) for such period minus (iv) proceeds received
during such period (to the extent included in determining operating
income) of any insurance policy described in clause (1) of Section
9.03 hereof.
"CD Base Rate" shall mean, with respect to any CD Loans,
the rate per annum determined on the basis of the bid rate for
certificates of deposit having a maturity equal to the Interest
Period for such Loans, which appears on the display page designated
as "Page 5" on the Dow Jones Telerate Service (or such other page
as may replace Page 5 on that service) at approximately 9:30 A.M.,
New York City time, on the first day of such Interest Period,
provided that if the above referenced rate is not available through
the Dow Jones Telerate Service, the CD Base Rate shall be the
arithmetic mean as determined by the Administrative Agent (rounded
upward, if necessary, to the next higher 1/100 of 1%) of the
prevailing rates per annum bid at approximately 10:00 A.M., New
York City time (or as soon thereafter as practicable), on the first
day of such Interest Period by two or more New York certificate of
deposit dealers of recognized national standing selected by the
Administrative Agent, for purchase at face value of deposits of
leading New York City banks for a maturity equal to such Interest
Period in an amount comparable to the principal amount of the CD
Loan being made by Chase.
"CD Loans" shall mean Working Capital Loans, the interest
on which is determined on the basis of rates referred to in the
definition of "CD Base Rate" in this Section 1.01.
"Chase" shall mean The Chase Manhattan Bank (National
Association) and its successors.
"Closing Date" shall mean the date of the initial Loans
made (or Letter of Credit issued) hereunder.
"Code" shall mean the Internal Revenue Code of 1986, as
amended, or any successor statute.
"Controlled Group" shall mean all members of a controlled
group of corporations and all trades or businesses (whether or not
incorporated) under common control which, together with the
Company, are treated as a single employer under Section 414 of the
Code.
"Cumulative Net Income" shall have the meaning assigned
to such term in Section 9.16 hereof.
"Default" shall mean an Event of Default or an event
which with notice or lapse of time or both would, unless cured or
waived, become an Event of Default.
"Dollars" and "$" shall mean lawful money of the United
States of America.
"Domestic Reserve Percentage" shall mean, for any day,
that percentage (expressed as a decimal) which is in effect on such
day, as prescribed by the Board of Governors of the Federal Reserve
System (or any successor), for determining the maximum reserve
requirement (including without limitation any basic, supplemental
or emergency reserves) for a member bank of the Federal Reserve
System in New York City with deposits exceeding five billion
dollars in respect of new non-personal time deposits in dollars in
New York City having a maturity comparable to the Interest Period
for which the Adjusted CD Rate is being determined and in an amount
of $100,000 or more. The Adjusted CD Rate shall be adjusted
automatically on and as of the effective date of any change in the
Domestic Reserve Percentage.
"Environmental Laws" shall mean any and all federal,
state, local and foreign statutes, laws, regulations, ordinances,
rules, judgments, orders, decrees, codes, plans, injunctions,
permits, concessions, grants, franchises, licenses, agreements or
other governmental restrictions relating to the environment or the
release of any materials into the environment.
"ERISA" shall mean the Employee Retirement Income
Security Act of 1974, as amended from time to time.
"Eurodollar Base Rate" shall mean, with respect to any
Eurodollar Loans and LIBOR Market Loans, the rate per annum
determined on the basis of the offered rate for deposits in Dollars
offered for a period comparable to the Interest Period for such
Loans, which appears on the display page designated as "LIBO Page"
on the Reuter Monitor Money Rates Service (or such other page as
may replace LIBO Page on that service) as of 11:00 A.M., London
time, two Business Days prior to the first day of such Interest
Period, provided that (i) if more than one such offered rate
appears on such page, the "Eurodollar Base Rate" will be the
arithmetic mean (rounded upward, if necessary, to the next higher
1/100th of 1%) of such offered rates; and (ii) if no such offered
rates appear on such page, the "Eurodollar Base Rate" for such
Interest Period will be the arithmetic mean (rounded upward, if
necessary, to the next higher 1/100th of 1%) of rates quoted by not
less than two major banks in New York City, selected by the
Administrative Agent, at approximately 10:00 A.M., New York City
time, two Business Days prior to the first day of such Interest
Period, for deposits in Dollars offered to leading European banks
for a period comparable to such Interest Period in an amount
comparable to, in the case of Eurodollar Loans, the principal
amount of the Eurodollar Loan of Chase having such Interest Period
or, in the case of LIBOR Market Loans, Chase's Working Capital
Commitment Percentage of the LIBOR Market Loans having such
Interest Period.
"Eurodollar Loans" shall mean Working Capital Loans the
interest on which is determined on the basis of rates referred to
in the definition of "Eurodollar Base Rate" in this Section 1.01.
"Eurodollar Rate" shall mean, for any Eurodollar Loans
and any LIBOR Market Loans, a rate per annum (rounded upwards, if
necessary, to the nearest 1/100 of 1%) determined by the
Administrative Agent to be equal to (i) the Eurodollar Base Rate
for such Loans for the Interest Period for such Loans divided by
(ii) 1 minus the Eurodollar Reserve Requirement for such Loans for
such Interest Period.
"Eurodollar Reserve Requirement" shall mean, for any
Eurodollar Loans and any LIBOR Market Loans for any Interest Period
therefor, the average maximum rate at which reserves (including any
marginal, supplemental or emergency reserves) are required to be
maintained during such Interest Period under Regulation D by member
banks of the Federal Reserve System in New York City with deposits
exceeding one billion Dollars against "Eurocurrency liabilities"
(as such term is used in Regulation D). Without limiting the
effect of the foregoing, the Eurodollar Reserve Requirement shall
reflect any other reserves required to be maintained by such member
banks by reason of any Regulatory Change against (i) any category
of liabilities which includes deposits by reference to which the
Eurodollar Rate is to be determined as provided in the definition
of "Eurodollar Base Rate" in this Section 1.01 or (ii) any category
of extensions of credit or other assets which include Eurodollar
Loans or LIBOR Market Loans.
"Event of Default" shall have the meaning assigned to
such term in Section 10.01 hereof.
"Existing Credit Agreement" shall mean the Amended and
Restated Credit Agreement dated as of April 25, 1990 among the
Company, the lenders listed on the signature pages thereof and The
Chase Manhattan Bank, (National Association), as administrative
agent for such lenders.
"Existing Letter of Credit" shall mean a Letter of Credit
(as defined in the Existing Credit Agreement).
"Existing Note Indenture" shall mean the Indenture dated
as of April 15, 1990 between the Company and LaSalle National Bank,
as Trustee, pursuant to which the Company issued $191,081,000 in
aggregate principal amount of its 15% Senior Subordinated Notes due
April 15, 2000, as the same shall, subject to Section 9.18 hereof,
be modified and supplemented and in effect from time to time.
"Existing Subordinated Indebtedness" shall mean the
Indebtedness evidenced by the subordinated notes of the Company
issued pursuant to the Existing Note Indenture.
"Federal Funds Rate" shall mean, for any day, the rate
per annum (rounded upwards, if necessary, to the nearest 1/100th of
1%) equal to the weighted average of the rates on overnight Federal
funds transactions with members of the Federal Reserve System
arranged by Federal funds brokers on such day, as published by the
Federal Reserve Bank of New York on the Business Day next
succeeding such day, provided that (a) if such day is not a
Business Day, the Federal Funds Rate for such day shall be such
rate on such transactions on the next preceding Business Day as so
published on the next succeeding Business Day, and (b) if no such
rate is so published on such next succeeding Business Day, the
Federal Funds Rate for such day shall be the average rate charged
to Chase on such day on such transactions as determined by the
Administrative Agent.
"Fixed Rate Loans" shall mean CD Loans, Eurodollar Loans
and, for the purposes of Section 6 hereof only, LIBOR Market Loans.
"Funded Indebtedness" shall mean Indebtedness which
matures more than one year after the incurrence thereof or is
extendible, renewable or refundable, at the option of the obligor,
to a date more than one year after the incurrence thereof
(including the current portion thereof).
"GAAP" shall mean generally accepted accounting
principles as in effect from time to time consistently applied.
"Gallman Indebtedness" shall mean all liabilities and
obligations of the Company in respect of $17,000,000 in aggregate
principal amount of industrial development revenue bonds to be
issued by the Mississippi Business Finance Corporation, the
proceeds of which are to be used to finance the planned expansion
and improvements at the Company's Gallman, Mississippi facility,
including, without limitation, reimbursement obligations and
obligations in respect of letters of credit issued in connection
therewith, which liabilities and obligations of the Company will be
secured only by the Company's existing and future real and personal
property located at its Gallman, Mississippi facility.
"Guaranty" by any Person means any obligation, contingent
or otherwise, of such Person directly or indirectly guaranteeing
any Indebtedness of any other Person and, without limiting the
generality of the foregoing, any obligation, direct or indirect,
contingent or otherwise, of such Person (i) to purchase or pay (or
advance or supply funds for the purchase or payment of) such
Indebtedness (whether arising by virtue of partnership
arrangements, by agreement to keep-well, to purchase assets, goods,
securities or services, to take-or-pay, or to maintain financial
statement conditions or otherwise, other than agreements to
purchase goods at an arm's length price in the ordinary course of
business) or (ii) entered into for the purpose of assuring in any
other manner the holder of such Indebtedness of the payment thereof
or to protect such holder against loss in respect thereof (in whole
or in part), provided that the term Guaranty shall not include
endorsements for collection or deposit in the ordinary course of
business. The term "Guarantee" used as a verb has a corresponding
meaning.
"Hazardous Substances" shall have the meaning set forth
in 42 U.S.C. Section 9601(14).
"Incentive Equity Plan" means the Company's 1990
Incentive Equity Plan, as the same shall be modified and
supplemented and in effect from time to time.
"Indebtedness" shall mean, as to any Person (determined
without duplication): (i) indebtedness of such Person for borrowed
money (whether by loan or the issuance and sale of debt securities)
or for the deferred purchase or acquisition price of property or
services, other than accounts payable (other than for borrowed
money) incurred in the ordinary course of business;
(ii) obligations of such Person in respect of letters of credit or
similar instruments issued or accepted by banks and other financial
institutions for the account of such Person; (iii) Capital Lease
Obligations of such Person; (iv) obligations of such Person to
redeem or otherwise retire shares of capital stock of such Person
or, in the case of the Company, any such obligation to redeem or
retire shares of capital stock of the Company prior to November 15,
1999; (v) indebtedness of others of the type described in clause
(i), (ii), (iii) or (iv) above secured by a Lien on the property of
such Person, whether or not the respective obligation so secured
has been assumed by such Person; (vi) indebtedness of others of the
type described in clause (i), (ii), (iii) or (iv) above Guaranteed
by such Person and (vii) deferred insurance premiums.
"Information Memorandum" shall mean the Information
Memorandum dated March 1994 submitted to the Lenders in connection
with the transactions contemplated by this Agreement.
"Interest Expense" shall mean, for any period, the sum
(determined without duplication) of the aggregate amount of
interest accruing during such period on Indebtedness of the Company
and its Subsidiaries (on a consolidated basis), plus the interest
portion of payments under Capital Lease Obligations and any
capitalized interest, and minus amortization of debt discount and
expense.
"Interest Period" shall mean, (1) with respect to any
Eurodollar Loans, the period commencing on the date such Loans are
made or converted from other Types of Loans or the last day of the
next preceding Interest Period with respect to such Loans and
ending on the numerically corresponding day in the first, third or
sixth (or, subject to the availability of deposits of the
corresponding maturity to each of the Lenders in the London
interbank market, second or twelfth) calendar month thereafter, as
the Company may select as provided in Section 5.05 hereof, except
that each such Interest Period which commences on the last Business
Day of a calendar month (or on any day for which there is no
numerically corresponding day in the appropriate subsequent
calendar month) shall end on the last Business Day of the
appropriate subsequent calendar month;
(2) with respect to any CD Loans, the period commencing
on the date such CD Loans are made or converted from other Types of
Loans or the last day of the next preceding Interest Period with
respect to such Loans and ending on the day 30, 60, 90, 180 or 360
days thereafter, as the Company may select as provided in Section
5.05 hereof;
(3) with respect to any Set Rate Loan, the period
commencing on the date such Set Rate Loan is made and ending on any
Business Day up to 360 days, but at least 7 days, thereafter, as
the Company may select as provided in Section 3.03(a) hereof; and
(4) with respect to any LIBOR Market Loan, the period
commencing on the date such LIBOR Market Loan is made and ending on
the numerically corresponding day in the first, second, third,
sixth or twelfth calendar month thereafter, as the Company may
select as provided in Section 3.03(a) hereof, except that each
Interest Period which commences on the last Business Day of a
calendar month (or any day for which there is no numerically
corresponding day in the appropriate subsequent calendar month)
shall end on the last Business Day of the appropriate subsequent
calendar month.
Notwithstanding the foregoing: (i) each Interest Period which
would otherwise end on a day which is not a Business Day shall end
on the next succeeding Business Day (or, in the case of an Interest
Period for Eurodollar Loans or LIBOR Market Loans, if such next
succeeding Business Day falls in the next succeeding calendar
month, on the next preceding Business Day); and (ii) no Interest
Period for any Fixed Rate Loans or LIBOR Market Loans shall have a
duration of less than one month (in the case of Eurodollar Loans
and LIBOR Market Loans) or 30 days (in the case of CD Loans) and,
if the Interest Period for any Fixed Rate Loan would otherwise be
a shorter period, such Loans shall not be available hereunder.
"Investments" shall have the meaning assigned to such
term in Section 9.15 hereof.
"Lender" and "Lenders" shall each have the meaning
assigned to such terms in the preamble hereto.
"Letter of Credit" shall have the meaning assigned to
such term in Section 2.02(a) hereof and shall, unless otherwise
expressly stated herein, include Swing Letters of Credit.
"Letter of Credit Liabilities" shall mean, at any time
and in respect of any Letter of Credit, the sum of (i) the amount
available for drawings under such Letter of Credit plus (ii) the
aggregate unpaid amount of all Reimbursement Obligations at the
time due and payable in respect of previous drawings made under
such Letter of Credit.
"LIBOR Auction" shall mean a solicitation of Money Market
Quotes setting forth Money Market Margins based on the Eurodollar
Rate pursuant to Section 3.03 hereof.
"LIBOR Market Loans" shall mean Money Market Loans, the
interest rates on which are determined on the basis of Eurodollar
Rates pursuant to a LIBOR Auction.
"Lien" shall mean, with respect to any asset, any
mortgage, lien, pledge, charge, security interest or encumbrance of
any kind in respect of such asset. For the purposes of this
Agreement, the Company and each of its Subsidiaries shall be deemed
to own subject to a Lien any asset which it has acquired or holds
subject to the interest of a vendor or lessor under any conditional
sale agreement, capital lease or other title retention agreement
relating to such asset.
"Liquid Investments" shall mean (i) time deposits
(including certificates of deposit) maturing within 90 days of the
acquisition thereof denominated in Dollars and issued by (X) a
Lender or (Y) a bank or trust company having combined capital and
surplus of at least $500,000,000 and which has (or which is a
Subsidiary of a bank holding company which has) publicly traded
debt securities rated AA or higher by Standard & Poor's Corporation
or Aa-2 or higher by Moody's Investors Service, Inc.;
(ii) obligations issued or guaranteed by the United States of
America, with maturities not more than one year after the date of
issue; and (iii) commercial paper with maturities of not more than
90 days and a published rating of not less than A-2 and P-2 (or the
equivalent rating).
"Loans" shall mean Money Market Loans, Swing Loans and
Working Capital Loans.
"Majority Lenders" shall mean, at any time while no
Working Capital Loans or Letter of Credit Liabilities (other than
in respect of Swing Letters of Credit) are outstanding, Lenders
having at least 51% of the aggregate amount of the Working Capital
Commitments and, at any time while Working Capital Loans or Letter
of Credit Liabilities (other than in respect of Swing Letters of
Credit) are outstanding, Lenders holding at least 51% of the
outstanding aggregate principal amount of Working Capital Loans and
Letter of Credit Liabilities (including, without limitation,
participation in the Participation Letters of Credit).
"Money Market Loan Notes" shall mean the promissory notes
of the Company evidencing the Money Market Loans, substantially in
the form of Exhibit B hereto.
"Money Market Loans" shall mean the loans provided for by
Section 3.03 hereof.
"Money Market Margin" shall have the meaning assigned to
such term in Section 3.03(b)(ii)(C) hereof.
"Money Market Quote" shall mean an offer in accordance
with Section 3.03(b) hereof by a Lender to make a Money Market Loan
with one single specified interest rate.
"Money Market Quote Request" shall have the meaning
assigned to such term in Section 3.03(a) hereof.
"Money Market Rate" shall have the meaning assigned to
such term in Section 3.03(b)(ii)(D) hereof.
"Net Cash Proceeds" shall mean, in each case as set forth
in a statement in reasonable detail delivered to the Administrative
Agent: (a) with respect to the disposition of any asset by the
Company or any of its Subsidiaries, the excess, if any, of (i) the
cash received in connection with such disposition over (ii) the sum
of (A) the principal amount of any Indebtedness which is secured by
such asset and which is required to be repaid in connection with
the disposition thereof, plus (B) the reasonable out-of-pocket
expenses incurred by the Company or such Subsidiary, as the case
may be, in connection with such disposition, plus (C) provision for
taxes, including income taxes, attributable to the disposition of
such asset; (b) with respect to the issuance of any Permitted
Refunding Subordinated Indebtedness of the Company, the gross
proceeds received by the Company from such issuance less all legal
expenses, discounts and commissions and other fees and expenses
incurred or to be incurred and all federal, state, local and
foreign taxes assessed or to be assessed in connection therewith;
and (c) with respect to the receipt by the Company or the
Administrative Agent of any payment under an insurance policy
described in clause (1) of Section 9.03 hereof or pursuant to any
condemnation award, the aggregate amount of any such payment made
to the Company or the Administrative Agent less any income tax
liability of the Company relating to such payment and all legal
expenses incurred in connection with the recovery or collection
thereof.
"Note Indentures" mean the Existing Note Indenture and
the Permitted Refunding Note Indenture.
"Notes" shall mean the Working Capital Loan Notes, Money
Market Loan Notes and the Swing Loan Note.
"Participation Letters of Credit" shall have the meaning
assigned to such term in Section 2.02(a) hereof.
"PBGC" shall mean the Pension Benefit Guaranty
Corporation or any entity succeeding to any or all of its functions
under ERISA.
"Performance Period" shall mean each of the periods
commencing on a day that a complete set of all financial statements
required to be delivered to the Administrative Agent under Section
9.01(b) is received by it and ending on a day immediately preceding
the day on which the next subsequent complete set of all the
financial statements required to be delivered to the Administrative
Agent under Section 9.01(b) is received by it; provided that the
first Performance Period shall commence on the Closing Date and be
based on the financial statements for March 31, 1994.
"Permitted Refunding Note Indenture" shall mean the
indenture or other agreement pursuant to which any Permitted
Refunding Subordinated Indebtedness is issued, as the same shall,
subject to Section 9.18 hereof, be modified and supplemented and in
effect from time to time.
"Permitted Refunding Subordinated Indebtedness" shall
mean Indebtedness of the Company (i) in an aggregate principal
amount of at least $150,000,000 but no more than $200,000,000, (ii)
the Net Cash Proceeds of which, if issued on or prior to April 16,
1995, are applied to prepay Loans pursuant to Section 3.02(a)
hereof, and if issued thereafter, are applied to redeem the
Existing Subordinated Indebtedness, and (iii) which has a final
maturity no earlier than November 15, 1999, an effective annual
interest cost (not including any increased interest cost which
might accrue by virtue of any default) to the Company (computed in
accordance with generally accepted financial practice) of no more
than 15% per annum, subordination provisions no less favorable to
the Lenders than those applicable to the Existing Subordinated
Indebtedness and other terms and provisions that are, when taken as
a whole, no less favorable to the Lenders in any material respect
(including, without limitation, covenants and events of default)
than those applicable to the Existing Subordinated Indebtedness.
"Person" shall mean an individual, a corporation, a
company, a voluntary association, a partnership, a trust, an
unincorporated organization or a government or any agency,
instrumentality or political subdivision thereof.
"Plan" shall mean an employee pension benefit plan which
is covered by Title IV of ERISA or subject to the minimum funding
standards under Section 412 of the Code and is either (a)
maintained by the Company or any member of the Controlled Group for
employees of the Company or any member of the Controlled Group or
(b) maintained pursuant to a collective bargaining agreement or any
other arrangement under which more than one employer makes
contributions and to which the Company or any member of the
Controlled Group is then making or accruing an obligation to make
contributions or has within the preceding five plan years made
contributions.
"Post-Default Rate" shall mean, in respect of any
principal of any Loan, any Reimbursement Obligation or any other
amount payable by the Company under this Agreement which is not
paid when due (whether at stated maturity, by acceleration or
otherwise), a rate per annum during the period commencing on the
due date until such amount is paid in full equal to the sum of 2%
plus the Base Rate as in effect from time to time plus the
Applicable Margin for Base Rate Loans.
"Prime Rate" shall mean the rate of interest from time to
time announced by Chase at the Principal Office as its prime
commercial lending rate. Each change in the interest rate provided
for herein resulting from a change in the Prime Rate shall take
effect at the time of such change in the Prime Rate.
"Principal Office" shall mean the principal office of
Chase, presently located at 1 Chase Manhattan Plaza, New York, New
York 10081.
"Quarterly Dates" shall mean the last Business Day of
each January, April, July and October.
"Regular Debt Service" shall mean, for any period, the
sum of (i) Scheduled Amortization for such period plus (ii)
Interest Expense for such period.
"Regulation D" shall mean Regulation D of the Board of
Governors of the Federal Reserve System as the same may be amended
or supplemented from time to time.
"Regulatory Change" shall mean, with respect to any
Lender, any change on or after the date of this Agreement in United
States federal, state or foreign laws or regulations (including
Regulation D) or the adoption or making on or after such date of
any interpretations, directives or requests applying to a class of
lenders including such Lender of or under any United States federal
or state, or any foreign, laws or regulations (whether or not
having the force of law) by any court or governmental or monetary
authority charged with the interpretation or administration
thereof.
"Reimbursement Obligations" shall mean as at any date,
the obligations of the Company then outstanding, or which may
thereafter arise in respect of Letters of Credit then outstanding,
under Sections 2.02(b) and 2.02(c)(iv) hereof to reimburse any
Lender in the case of Syndicated Letters of Credit or Chase in the
case of Participation Letters of Credit and Swing Letters of Credit
for the amount paid by such Lender or Chase in respect of any
drawing under such Letter of Credit.
"Release" shall have the meaning set forth in 42 U.S.C.
Section 9601(22), but shall not include any "federally permitted
release" as defined in 42 U.S.C. Section 9601(10). The term
"Released" shall have a corresponding meaning.
"Restricted Payment" shall mean dividends (in cash,
property or obligations) on, or other payments or distributions on
account of, or the setting apart of money for a sinking or other
analogous fund for the purchase, redemption, retirement or other
acquisition of, any shares of any class of capital stock of the
Company, or the exchange or conversion of any shares of any class
of capital stock of the Company for or into any obligations of or
shares of any other class of capital stock of the Company or any
other property, but excluding dividends payable solely in, or
exchanges or conversions for or into, shares of common stock of the
Company.
"Scheduled Amortization" shall mean, for any period, the
sum (calculated without duplication) of all payments of principal
of Indebtedness of the Company (other than Indebtedness hereunder)
scheduled to be made during such period.
"Set Rate Auction" shall mean a solicitation of Money
Market Quotes setting forth Money Market Rates pursuant to Section
3.03 hereof.
"Set Rate Loans" shall mean Money Market Loans the
interest rates on which are determined on the basis of Money Market
Rates pursuant to a Set Rate Auction.
"Subordinated Indebtedness" shall mean the Existing
Subordinated Indebtedness and the Permitted Refunding Subordinated
Indebtedness.
"Subsidiary" shall mean, with respect to any Person, any
corporation of which at least a majority of the outstanding shares
of stock having by the terms thereof ordinary voting power to elect
a majority of the board of directors of such corporation
(irrespective of whether or not at the time stock of any other
class or classes of such corporation shall have or might have
voting power by reason of the happening of any contingency) is at
the time directly or indirectly owned or controlled by such Person
or one or more of the Subsidiaries of such Person or by such Person
and one or more of the Subsidiaries of such Person; provided that
Systronics, Inc. shall not be deemed to be a Subsidiary of the
Company for purposes hereof.
"Swing Letters of Credit" shall have the meaning assigned
to such term in Section 2.02(b) hereof.
"Swing Loan Notes" shall mean the promissory notes of the
Company evidencing the Swing Loans, substantially in the form of
Exhibit C hereto.
"Swing Loans" shall have the meaning assigned to such
term in Section 2.01(b) hereof.
"Syndicated Letters of Credit" shall have the meaning
assigned to such term in Section 2.02(a) hereof.
"Type" shall have the meaning assigned to such term in
Section 1.03 hereof.
"Unfunded Liabilities" shall mean, with respect to any
Plan, at any time, the amount (if any) by which (a) the present
value of all benefits under such Plan exceeds (b) the fair market
value of all Plan assets allocable to such benefits, all determined
as of the then most recent valuation date for such Plan, but only
to the extent that such excess represents a potential liability of
the Company or any member of the Controlled Group to the PBGC or
such Plan under Title IV of ERISA.
"Wholly-Owned Subsidiary" shall mean a Subsidiary of the
Company all of whose outstanding shares of capital stock (except
directors' qualifying shares) are directly or indirectly owned by
the Company.
"Working Capital Availability Period" shall mean the
period from and including the date hereof to but not including
April 27, 1999.
"Working Capital Commitment" shall mean, as to any
Lender, the obligation of such Lender to make Working Capital Loans
and incur Letter of Credit Liabilities in an aggregate principal
amount at any one time outstanding up to but not exceeding the
amount set forth opposite such Lender's name on the signature pages
hereto under the caption "Working Capital Commitment" (as the same
may be reduced from time to time pursuant to Section 2.03 hereof).
"Working Capital Commitment Percentage" shall mean, as to
any Lender, the percentage equivalent of a fraction the numerator
of which is the Working Capital Commitment of such Lender and the
denominator of which is the aggregate amount of the Working Capital
Commitments of all Lenders.
"Working Capital Loan" shall mean, as to any Lender, any
loan made by such Lender pursuant to Section 2.01(a) hereof.
"Working Capital Loan Notes" shall mean the promissory
notes of the Company evidencing the Working Capital Loans,
substantially in the form of Exhibit A hereto.
"Working Capital Obligations" shall mean, as at any date
of determination thereof, the sum of the following (determined
without duplication): (i) the aggregate principal amount of
Working Capital Loans (including all Swing Loans) outstanding
hereunder plus (ii) the aggregate amount of the Letter of Credit
Liabilities (including Letter of Credit Liabilities in respect of
Swing Letters of Credit) hereunder plus (iii) the aggregate
principal amount of Money Market Loans outstanding hereunder.
1.02 Accounting Terms and Determinations. Unless
otherwise specified herein, all accounting terms used herein shall
be interpreted, all determinations with respect to accounting
matters hereunder shall be made, and all financial statements and
certificates and reports as to financial matters required to be
delivered hereunder shall be prepared, in accordance with GAAP;
provided that if any change in GAAP in itself materially affects
the calculation of any financial covenant in Section 9, the Company
may by notice to the Administrative Agent, or the Administrative
Agent (at the request of the Majority Lenders) may by notice to the
Company, require that such covenant thereafter be calculated in
accordance with GAAP as in effect, and applied by the Company,
immediately before such change in GAAP occurs. If such notice is
given, the compliance certificates delivered pursuant to Section
9.01 after such change occurs shall be accompanied by
reconciliations of the difference between the calculation set forth
therein and a calculation made in accordance with GAAP as in effect
from time to time after such change occurs. To enable the ready
determination of compliance with the covenants set forth in Section
9 hereof, the Company will not change from December 31 in each year
the date on which its fiscal year ends, nor from March 31, June 30
and September 30 the dates on which the first three fiscal quarters
in each fiscal year end.
1.03 Classes and Types of Loans. Loans hereunder are
classified as either Working Capital Loans, Swing Loans or Money
Market Loans by reference to the provisions hereof under which
participation in the related borrowings are determined (i.e., a
"Working Capital Loan" is included in a borrowing in which all
Lenders participate, a "Swing Loan" is included in a borrowing in
which Chase is the only Lender that participates and a "Money
Market Loan" is included in a borrowing in which the Lender
participants are determined on the basis of their bids in
accordance with Section 3.03). Working Capital Loans and Money
Market Loans are divided into "Types". The "Type" of a Working
Capital Loan refers to the determination whether such Loan is a
Eurodollar Loan, a Base Rate Loan or CD Loan. The "Type" of Money
Market Loan refers to the determination whether such Loan is a Set
Rate Loan or a LIBOR Market Loan. All Swing Loans are Base Rate
Loans. Working Capital Loans and Money Market Loans are sometimes
identified by Type (e.g., a "Eurodollar Working Capital Loan"
indicates that such Loan is both a Eurodollar Loan and a Working
Capital Loan).
Section 2. Loans and Letters of Credit.
2.01 Loans.
(a) Working Capital Loans. Each Lender severally agrees
that, from time to time during the Working Capital Availability
Period, it shall make, subject to the terms of this Agreement,
Loans to the Company in an aggregate principal amount at any one
time outstanding which, together with an amount equal to the
product of (x) its Working Capital Commitment Percentage times (y)
the sum of (a) all Money Market Loans and (b) all Letter of Credit
Liabilities at such time in respect of Syndicated Letters of Credit
and Participation Letters of Credit, shall not exceed its Working
Capital Commitment, as reduced from time to time pursuant to
Section 2.03 hereof; provided that the aggregate amount of all
Working Capital Obligations shall not at any time exceed the
aggregate of the Working Capital Commitments as reduced from time
to time pursuant to Section 2.03 hereof.
(b) Swing Loans. In addition to the foregoing, Chase
may from time to time, in its discretion, upon the request of the
Company, if the applicable conditions precedent in Section 7 have
been satisfied, make loans ("Swing Loans") to the Company in an
aggregate principal amount at any one time outstanding which, when
combined with the aggregate Letter of Credit Liabilities at such
time in respect of all Swing Letters of Credit, shall not exceed
$15,000,000; provided that the aggregate amount of all Working
Capital Obligations shall not at any time exceed the aggregate of
the Working Capital Commitments as reduced from time to time
pursuant to Section 2.03 hereof. Swing Loans shall constitute
"Working Capital Loans" hereunder. All Swing Loans shall be made
as Base Rate Loans and may be borrowed, repaid and reborrowed. At
any time, upon the request of Chase, each Lender other than Chase
shall, on the third Business Day after such request is made,
purchase a participating interest in Swing Loans in an amount equal
to its Working Capital Commitment Percentage of such Swing Loans.
On such third Business Day, each Lender will immediately transfer
to Chase, in immediately available funds, the amount of its
participation. Whenever, at any time after Chase has received from
any Lender such Lender's participating interest in a Swing Loan,
the Administrative Agent receives any payment on account thereof,
the Administrative Agent will distribute to such Lender its
participating interest in such amount (appropriately adjusted, in
the case of interest payments, to reflect the period of time during
which such Lender's participating interest was outstanding and
funded); provided, however, that in the event that such payment
received by the Administrative Agent is required to be returned,
such Lender will return to the Administrative Agent any portion
thereof previously distributed by the Administrative Agent to it.
Each Lender's obligation to purchase such participating interests
shall be absolute and unconditional and shall not be affected by
any circumstance, including, without limitation, (i) any set-off,
counterclaim, recoupment, defense or other right which such Lender
or any other Person may have against Chase requesting such purchase
or any other Person for any reason whatsoever; (ii) the occurrence
or continuance of a Default or an Event of Default or the
termination of the Working Capital Commitments; (iii) any adverse
change in the condition (financial or otherwise) of the Company or
any other Person; (iv) any breach of this Agreement by the Company
or any other Lender; or (v) any other circumstance, happening or
event whatsoever, whether or not similar to any of the foregoing.
(c) Money Market Loans. In addition to Working Capital
Loans, the Company may request the Lenders to make offers to make
Money Market Loans to the Company as set forth in Section 3.03.
The Lenders may, but shall have no obligation to, make such offers
and the Company may, but shall have no obligation to, accept any
such offers; provided that the aggregate principal amount of all
Working Capital Obligations shall not at any time exceed the
aggregate amount of the Working Capital Commitments as reduced from
time to time pursuant to Section 2.03 hereof.
2.02 Letters of Credit.
(a) Working Capital Letters of Credit. Subject to the
terms and conditions hereof, the Working Capital Commitments may,
in addition to the Working Capital Loans provided for in Section
2.01 hereof, be utilized, upon the request of the Company, by the
issuance of letters of credit (i) by Chase for so long as it is
Administrative Agent hereunder if the Company shall so request in
the notice referred to in Section 2.02(c)(i) and Chase shall agree
that such letter of credit shall be issued by Chase rather than by
each of the Lenders (such letters of credit issued by Chase being
hereinafter referred to as the "Participation Letters of Credit"),
or (ii) by the Lenders pursuant to which each Lender shall be
severally obligated to pay its Working Capital Commitment
Percentage of any drawing made thereunder (such letters of credit
issued by the Lenders being hereafter referred to as the
"Syndicated Letters of Credit", and the Syndicated Letters of
Credit and Participation Letters of Credit being collectively
referred to as the "Letters of Credit"). Notwithstanding any
reference in any Existing Letter of Credit to the Existing Credit
Agreement, on and as of the Closing Date, each Existing Letter of
Credit shall be deemed to be a Participation Letter of Credit and
to have been issued pursuant to this Section on the Closing Date.
Upon the date of issuance of a Participation Letter of Credit,
Chase shall be deemed, without further action by any party hereto,
to have sold to each Lender, and each Lender shall be deemed,
without further action by any party hereto, to have purchased from
Chase, a participation to the extent of such Lender's Working
Capital Commitment Percentage in such Participation Letter of
Credit and the related Letter of Credit Liabilities. The aggregate
amount of all Working Capital Obligations shall not at any time
exceed the aggregate of the Working Capital Commitments as reduced
from time to time pursuant to Section 2.03 hereof.
(b) Swing Letters of Credit. In addition to the
foregoing, if the Company reasonably determines that a letter of
credit cannot be made available for its account in a timely fashion
pursuant to Section 2.02(a), Chase may from time to time, in its
discretion, issue letters of credit ("Swing Letters of Credit") for
the account of the Company in amounts such that the aggregate
Letter of Credit Liabilities in respect of Swing Letters of Credit
at any one time, when combined with the aggregate outstanding
principal amount of all Swing Loans at such time, shall not exceed
$15,000,000. Swing Letters of Credit shall have terms not
extending beyond the earlier of (i) one year from the date of
issuance and (ii) the last day of the Working Capital Availability
Period and shall be in such form as Chase may from time to time
approve. The Company shall give Chase at least one Business Day's
(or in the case of "standby" Swing Letters of Credit, such other
longer period of notice as Chase may require) irrevocable prior
notice (effective upon receipt) specifying the date each Swing
Letter of Credit is to be issued, and describing the proposed terms
of such Letter of Credit and the nature of the transactions
proposed to be supported thereby. Upon receipt from the
beneficiary of any Swing Letter of Credit of any demand for payment
thereunder, Chase shall promptly notify the Company of the amount
to be paid as a result of such demand and the respective payment
date. The Company shall be irrevocably and unconditionally
obligated forthwith to reimburse Chase for any amounts paid by it
upon any drawing under any Swing Letter of Credit, without
presentment, demand, protest or other formalities of any kind. The
Company will pay to Chase a letter of credit fee on the daily
average undrawn face amount of each Swing Letter of Credit for the
period from and including the date of issuance of such Letter of
Credit to and including the date of expiration or termination
thereof at a rate per annum equal to the Applicable Margin for
Swing Letters of Credit (or such other rate per annum as the
Company and Chase may agree from time to time), such fee to be paid
in arrears on each Quarterly Date (or such other date as the
Company and Chase may agree from time to time). At any time during
the term of a Swing Letter of Credit, if the Company shall request
that participations in such Swing Letter of Credit and the related
Letter of Credit Liabilities be sold by Chase to the Lenders and
Chase shall agree to such request, or if Chase wishes to sell such
participations, then the Administrative Agent shall promptly so
notify each Lender, and on the third Business Day following such
request, subject to the satisfaction of all applicable conditions
precedent under Section 7, Chase shall be deemed, without further
action by any party hereto, to have sold to each Lender and each
Lender shall be deemed, without further action by any party hereto,
to have purchased from Chase a participation to the extent of such
Lender's Working Capital Commitment Percentage in such Letter of
Credit and the related Letter of Credit Liabilities and thereupon
such Letter of Credit shall cease to constitute a Swing Letter of
Credit but shall constitute a Participation Letter of Credit for
the purposes of this Agreement.
(c) Additional Provisions. The following additional
provisions shall apply to each Letter of Credit other than a Swing
Letter of Credit:
(i) Except in the case of Letters of Credit deemed,
pursuant to the second sentence of subsection (a) above, to be
issued on the Closing Date, the Company shall give the
Administrative Agent at least ten Business Days' (in the case
of Syndicated Letters of Credit) or two Business Days' (in the
case of Participation Letters of Credit) irrevocable prior
notice (effective upon receipt) specifying the date such
Letter of Credit is to be issued, whether it is requesting
that such Letter of Credit be a Participation Letter of Credit
or a Syndicated Letter of Credit, and describing the proposed
terms of such Letter of Credit and the nature of the
transactions proposed to be supported thereby. Upon receipt
of such notice the Administrative Agent shall promptly notify
each Lender of the contents thereof and of such Lender's
Working Capital Commitment Percentage of the amount of such
proposed Letter of Credit and, in the case of Syndicated
Letters of Credit, not later than seven Business Days prior to
the requested issuance date for such Letter of Credit shall
prepare and send to the Lenders and the Company a proposed
form of such Letter of Credit.
(ii) On each day during the period commencing with the
issuance by the Lenders of any Syndicated Letter of Credit or
the issuance by Chase of any Participation Letter of Credit
(or the date upon which, pursuant to the provisions of Section
2.02(b) hereof, a Swing Letter of Credit constitutes a
Participation Letter of Credit) and until such Letter of
Credit shall have expired or been terminated, except as
provided in Section 2.04 hereof, the Working Capital
Commitment of each Lender shall be deemed to be utilized for
all purposes hereof in an amount equal to such Lender's
Working Capital Commitment Percentage of the amount then
available for drawings under such Syndicated Letter of Credit
or Participation Letter of Credit (as the case may be).
(iii) Upon receipt from the beneficiary of any Letter of
Credit of any demand for payment or other drawing under such
Letter of Credit, the Administrative Agent shall promptly
notify the Company and each Lender as to the amount to be paid
as a result of such demand or drawing and the respective
payment date. If at any time Chase shall make a payment to a
beneficiary of a Participation Letter of Credit in respect of
a drawing or in respect of an acceptance created in connection
with a drawing under such Participation Letter of Credit, each
Lender will pay to Chase, immediately upon Chase's demand at
any time during the period commencing after such payment until
reimbursement therefor in full by the Company, an amount equal
to such Lender's Working Capital Commitment Percentage of such
payment, together with interest on such amount for each day
from the date of Chase's demand for such payment (or, if such
demand is made after 11:00 a.m. (New York City time) on such
date, from the next succeeding Business Day) to the date of
payment by such Lender of such amount at a rate of interest
per annum equal to the Federal Funds Rate for such period.
Nothing herein shall be deemed to require any Lender to pay to
Chase any amount as reimbursement for any payment made by
Chase to acquire (discount) for its own account prior to
maturity thereof any acceptance created under a Participation
Letter of Credit.
(iv) The Company shall be irrevocably and unconditionally
obligated forthwith to reimburse (x) the Administrative Agent
for the account of each Lender in the case of Syndicated
Letters of Credit, and (y) Chase in the case of Participation
Letters of Credit for any amounts paid by such Lender or Chase
(as the case may be) upon any drawing under any Letter of
Credit, without presentment, demand, protest or other
formalities of any kind. Chase will pay to each Lender such
Lender's Working Capital Commitment Percentage of all amounts
received from the Company for application in payment, in whole
or in part, of the Reimbursement Obligation in respect of any
Participation Letter of Credit, but only to the extent such
Lender has made payment to Chase in respect of such
Participation Letter of Credit pursuant to clause (iii) above.
Nothing herein shall be deemed to require Chase to pay to any
Lender any part of the proceeds of disposition (rediscount) by
Chase for its own account to any other person of any
acceptance created under a Participation Letter of Credit
which is acquired (discounted) by Chase prior to maturity
thereof.
(v) The Company will pay to the Administrative Agent for
the account of each Lender a letter of credit fee on such
Lender's Working Capital Commitment Percentage of the daily
average amount available for drawings under each Syndicated
Letter of Credit and Participation Letter of Credit, in each
case for the period from and including the date of issuance of
such Letter of Credit to and including the date of expiration
or termination thereof at a rate per annum equal to the
Applicable Margin for such Letters of Credit, such fee to be
paid in arrears on each Quarterly Date. The Administrative
Agent will pay to each Lender, promptly after receiving any
payment in respect of letter of credit fees referred to in
this clause (v), such Lender's share of such fees. In
addition, the Company will pay to the Administrative Agent for
the account of Chase an additional letter of credit fee on the
daily average amount available for drawing under each such
Letter of Credit, computed and payable in the manner set forth
in the first sentence of this clause (v), at a rate per annum
equal to 1/4 of 1%.
(vi) The issuance by the Lenders of each Syndicated
Letter of Credit or the issuance by Chase of each
Participation Letter of Credit shall, in addition to the
conditions precedent set forth in Section 7 hereof, be subject
to the conditions precedent (x) that in the case of a
Syndicated Letter of Credit, such Letter of Credit shall be in
such form, contain such terms and support such transactions as
shall be reasonably satisfactory to each Lender and the
Administrative Agent and that the Company shall have executed
and delivered such other instruments and agreements relating
to such Letter of Credit as the Majority Lenders shall have
reasonably requested, and (y) that in the case of
Participation Letters of Credit, such Letter of Credit shall
be in such form, and shall contain such terms and support such
transactions, as shall be satisfactory to Chase, and that the
Company shall have executed and delivered such other
instruments and agreements relating to such Letter of Credit
as Chase shall have reasonably requested. No Letter of Credit
shall have a term extending beyond the earlier of (i) one year
from the date of issuance and (ii) the last day of the Working
Capital Availability Period, and the aggregate Letter of
Credit Liabilities in respect of all Letters of Credit
outstanding at any time shall not exceed $30,000,000. A
Lender shall be deemed to have determined that a proposed
Syndicated Letter of Credit is satisfactory unless it shall
have notified the Administrative Agent otherwise (which notice
shall be effective upon receipt) on or before the date three
Business Days prior to the requested date of issuance of such
Syndicated Letter of Credit. If any Lender shall breach its
obligation to execute and deliver a Syndicated Letter of
Credit hereunder, the other Lenders shall be relieved of their
obligation to execute and deliver and issue such Syndicated
Letter of Credit, provided that nothing herein shall affect
any rights the Company may have against the breaching Lender
as a result of such breach.
(d) Indemnification. The Company hereby indemnifies and
holds harmless each Lender and the Administrative Agent (which for
purposes of this Section 2.02(d) shall include a reference to Chase
acting in its individual capacity hereunder as issuer of
Participation Letters of Credit and Swing Letters of Credit) from
and against any and all claims and damages, losses, liabilities,
costs or expenses which such Lender or the Administrative Agent may
incur (or which may be claimed against such Lender or the
Administrative Agent by any Person whatsoever) by reason of or in
connection with the execution and delivery or transfer of or
payment or failure to pay under any Letter of Credit, including,
without limitation, any claims, damages, losses, liabilities, costs
or expenses which the Administrative Agent may incur by reason of
or in connection with the failure of any other Lender to fulfill or
comply with its obligations to the Administrative Agent hereunder
(but nothing herein contained shall affect any rights the Company
may have against such defaulting Lender); provided that the Company
shall not be required to indemnify any Lender or the Administrative
Agent for any claims, damages, losses, liabilities, costs or
expenses to the extent, but only to the extent, caused by (i) the
willful misconduct or gross negligence of such Lender or the
Administrative Agent in determining whether a request presented
under any Letter of Credit complied with the terms of such Letter
of Credit or (ii) such Lender's failure to pay under any Letter of
Credit after the presentation to it of a request strictly complying
with the terms and conditions of the Letter of Credit. Nothing in
this Section 2.02(d) is intended to limit the obligations of the
Company under any other provision of this Agreement.
2.03 Reductions of Commitments.
(a) Mandatory. (i) The Working Capital Commitments
shall terminate on the last day of the Working Capital Availability
Period.
(ii) In addition, the Working Capital Commitments shall
be reduced in the following amounts:
(1) Insurance Proceeds and Condemnation Awards.
Promptly following the receipt thereof by the Company or any
Subsidiary of the Company, the Company shall deposit with the
Administrative Agent in a cash collateral account established
by the Company for such purpose an amount of cash or Liquid
Investments equal to the aggregate Net Cash Proceeds of any
payment made to the Company or any Subsidiary of the Company
(i) under any insurance policy (other than for business
interruption) described in clause (1) of Section 9.03 hereof
or (ii) pursuant to any condemnation award; provided that such
deposit shall be required only to the extent that the
aggregate amount of such payments made during the term of this
Agreement exceeds $5,000,000, and shall not be required to the
extent such payments relate to the Company's Gallman,
Mississippi facility and are required to be disposed of
otherwise under the instruments governing the Gallman
Indebtedness. With respect to any such deposit, so long as no
Default has occurred and is continuing, amounts equal to the
lesser of (x) the aggregate amount of such cash proceeds which
the Company or such Subsidiary has expended or committed to
expend for the restoration or replacement of the asset in
respect of which such payment or award was made and (y)
$100,000,000 in the aggregate in respect of such asset, or
such greater amount as the Majority Lenders shall approve,
shall be released by the Administrative Agent to the Company;
provided that in the event that within 180 days of receipt of
such payment the Company or such Subsidiary shall not have
expended or committed to expend an equivalent amount for the
restoration or replacement of the asset in respect of which
such payment was made, the Commitments shall be reduced by an
amount equal to the excess of the amount of such payment over
the amount of such expenditures and commitments and any
amounts remaining in such cash collateral account shall first
be applied in accordance with Section 3.02(b) and then (if any
amounts are remaining) be released to the Company.
(2) Asset Dispositions. The Commitments shall be
reduced in the amount of and on the date of each receipt by
the Company or any Subsidiary of the Company of (x) the Net
Cash Proceeds of any disposition by such Person of any assets
pursuant to clause (ii), (v), (vi) or (vii) of Section 9.13,
to the extent that the Net Cash Proceeds from such disposition
and all other such dispositions made pursuant to such clauses
during the then current fiscal year exceed $10,000,000, (y)
any payments in respect of receivables retained by such Person
arising from the sale of goods or services at facilities
disposed of in asset dispositions or (z) the Net Cash Proceeds
of any disposition by such Person of any accounts receivable
pursuant to clause (viii) of Section 9.13.
(b) Optional. The Company shall have the right to
terminate or reduce the Working Capital Commitments at any time or
from time to time, provided that: (i) the Company shall give
notice of each such termination or reduction to the Administrative
Agent as provided in Section 5.05 hereof and (ii) each partial
reduction shall be in an aggregate amount at least equal to
$5,000,000.
(c) No Reinstatement. Commitments once terminated or
reduced may not be reinstated.
2.04 Fees. (a) Facility Fee. The Company shall pay to
the Administrative Agent for the account of the Lenders ratably a
facility fee for each day at a per annum rate equal to the Facility
Fee Rate for such day. Such facility fee shall accrue from and
including the Closing Date to but excluding the date on which the
Working Capital Commitments are terminated in their entirety, on
the aggregate amount of the Working Capital Commitments (whether
used or unused) in effect on each day during such period. Accrued
facility fees shall be payable on the Quarterly Dates and on the
date on which the Working Capital Commitments are terminated in
their entirety. In addition, if the Facility Fee Increase Date (as
defined below) shall occur on or before April 15, 1995, the Company
shall pay on such date to the Administrative Agent for the account
of the Lenders ratably an additional facility fee (the "Additional
Fee") equal to the difference between (x) the aggregate facility
fee that would have been payable with respect to the period from
the Closing Date to the Quarterly Date through which the facility
fee has then been paid, calculated as if the Facility Fee Increase
Date had been the Closing Date, less (y) the aggregate facility fee
actually paid with respect to such period; provided that if the
Facility Fee Increase Date occurs on or before the 30th day after
the Closing Date but no Working Capital Loans are outstanding
during the period from and including the 30th day after the Closing
Date to and including April 15, 1995, the period with respect to
which the Additional Fee is calculated shall include only those
days when Working Capital Loans are outstanding and the Additional
Fee shall be paid on one or more dates satisfactory to the
Administrative Agent.
"Facility Fee Increase Date" shall mean the date that is
the earlier to occur of (x) April 16, 1995 and (y) the date of the
first borrowing of Working Capital Loans under this Agreement.
The "Facility Fee Rate" shall mean for any day during any
Performance Period, the percentage set forth in the applicable row
under the column corresponding to the Applicable Pricing Ratio for
such Performance Period.
<TABLE>
<CAPTION>
Applicable
Pricing Ratio
Less than or Less than or
equal to 3.75 equal to 2.50
to 1.0 but to 1.0 but Less than or
Greater than greater than greater than equal to 1.50
3.75 to 1.0 2.50 to 1.0 1.50 to 1.0 to 1.0
<S> <C> <C> <C> <C>
Date prior to
Facility Fee
Increase Date 0.25% 0.15% 0.15% 0.15%
Date or or after
Facility Fee
Increase Date 0.375% 0.30% 0.25% 0.20%
</TABLE>
(b) Administration Fee. The Company shall pay to the
Administrative Agent on each anniversary of the Closing Date, so
long as any of the Working Capital Commitments are in effect and
until payment in full of all Loans hereunder, the termination of
all Letters of Credit and payment in full of all Letter of Credit
Liabilities, all interest thereon and all other amounts payable
hereunder, an annual administration fee in the amount heretofore
mutually agreed. The Company shall also pay to the Administrative
Agent fees in connection with each Money Market Quote Request at
the time and in the amount from time to time agreed between the
Company and the Administrative Agent.
2.05 Lending Offices. The Loans of each Type made by
each Lender shall be made and maintained at such Lender's
Applicable Lending Office for Loans of such Type.
2.06 Several Obligations. The failure of any Lender to
make any Loan to be made by it on the date specified therefor shall
not relieve any other Lender of its obligation to make its Loan on
such date, but neither the Administrative Agent nor any Lender
shall be responsible for the failure of any other Lender to make a
Loan to be made by such other Lender.
2.07 Notes. (a) Working Capital Loans. The Working
Capital Loans made by each Lender shall be evidenced by a single
Working Capital Loan Note of the Company in substantially the form
of Exhibit A hereto, dated the date of this Agreement, payable to
the order of such Lender and otherwise duly completed.
(b) Swing Loans. Swing Loans shall be evidenced by a
single promissory note of the Company in the form of Exhibit C
hereto, dated the date of this Agreement, payable to the order of
Chase and otherwise duly completed. Such promissory note shall
constitute one of the "Notes" hereunder.
(c) Money Market Loans. The Money Market Loans made by
any Lender shall be evidenced by a single promissory note of the
Company in substantially the form of Exhibit B hereto, dated the
date of the delivery of such Note to the Administrative Agent under
this Agreement, payable to the order of such Lender and otherwise
duly completed.
(d) Note Schedules. Each Lender is hereby authorized by
the Company to endorse on the schedule (or a continuation thereof)
attached to each Note of such Lender, to the extent applicable, the
date, amount, interest rate, Type of and the Interest Period (if
any) for each Loan made by such Lender to the Company hereunder and
evidenced by such Note, and the date and amount of each payment or
prepayment of principal of such Loan received by such Lender;
provided that any failure by such Lender to make any such
endorsement shall not affect the obligations of the Company under
such Note or hereunder in respect of such Loan.
2.08 Use of Proceeds. Proceeds of the Loans shall be
used by the Company for working capital purposes and any other
corporate purposes not prohibited by this Agreement. None of such
proceeds shall be used, directly or indirectly, for the purpose,
whether immediate, incidental or ultimate, of buying or carrying
any margin stock (within the meaning of Regulation U or X of the
Board of Governors of the Federal Reserve System).
Section 3. Borrowings, Conversions and Prepayments.
3.01 Borrowings. (a) Working Capital Loans. The
Company shall give the Administrative Agent notice of each
borrowing of Working Capital Loans (other than a borrowing of Swing
Loans as to which subsection (b) of this Section 3.01 shall apply)
to be made hereunder as provided in Section 5.05 hereof. Not later
than 11:00 a.m. New York time on the date specified for each such
borrowing hereunder, each Lender shall make available the amount of
the Loan to be made by it on such date to the Administrative Agent,
at the Principal Office, in immediately available funds, for the
account of the Company. The amount so received by the
Administrative Agent shall, subject to the terms and conditions of
this Agreement, be made available to the Company by depositing the
same, in immediately available funds, in an account designated by
the Company maintained with the Administrative Agent at the
Principal Office.
(b) Swing Loans. The Company shall give the
Administrative Agent notice of each borrowing of a Swing Loan to be
made hereunder as provided in Section 5.05 hereof and, no later
than 2:00 p.m. New York time on the date specified for such
borrowing hereunder, Chase shall make available the amount of such
Swing Loan to the Company by depositing the same, in immediately
available funds, in an account designated by the Company maintained
with the Administrative Agent at the Principal Office.
(c) Money Market Loans. Requests by the Company of
offers to make Money Market Loans shall be made as provided in
Section 3.03.
3.02 Prepayments and Conversions.
(a) Optional Prepayments and Conversions. The Company
shall have the right to prepay Working Capital Loans and to convert
Working Capital Loans of one Type into Working Capital Loans of a
different Type, at any time or from time to time, provided that the
Company shall give the Administrative Agent notice of each such
prepayment as provided in Section 5.05 hereof. The Company may not
prepay Money Market Loans or convert Swing Loans or Money Market
Loans from one Type to a different Type, except that the Company
may prepay Money Market Loans to the extent required pursuant to
Section 3.02(b) hereof.
(b) Mandatory Prepayments and Cover. On the date of
each reduction of Commitments pursuant to Section 2.03(a)(ii), the
Company shall prepay Loans, together with accrued interest on the
principal amount prepaid, to the extent (if any) required so that
the aggregate principal amount of Loans outstanding immediately
after such prepayment will not exceed the aggregate amount of
Commitments after giving effect to such reduction. Any prepayment
pursuant to this subsection (b) shall be applied, first, to Swing
Loans and to provide cover for Letter of Credit Liabilities in
respect of Swing Letters of Credit, second, to all other Working
Capital Loans and to provide cover for other Letter of Credit
Liabilities and third, to Money Market Loans, pro rata. In the
event that the Company shall be required pursuant to this
subsection (b) to prepay any Working Capital Loans or provide cover
for any Letter of Credit Liabilities, the Company shall, until the
relevant Working Capital Loans have been paid in full, first prepay
the principal of such Loans and then, following such payment in
full, provide cover for the relevant Letter of Credit Liabilities.
Cover for Letter of Credit Liabilities shall be effected by paying
to the Administrative Agent immediately available funds, to be held
by the Administrative Agent (to the extent practicable, in Liquid
Investments) in a cash collateral account established by the
Company for such purpose, in an amount equal to the required
prepayment, which amount shall be retained by the Administrative
Agent in such cash collateral account until such time as the
Letters of Credit shall have been terminated and all of the Letter
of Credit Liabilities paid in full.
3.03 Money Market Loans.
(a) When, pursuant to Section 2.01(c), the Company
wishes to request offers to make Money Market Loans, it shall give
the Administrative Agent (which shall promptly notify the Lenders)
notice (a "Money Market Quote Request") no later than 11:00 a.m.
New York time on (x) the fourth Business Day prior to the date of
borrowing proposed therein, in the case of a LIBOR Auction or (y)
the Business Day next preceding the date of borrowing proposed
therein, in the case of a Set Rate Auction (or, in any such case,
such other time and date as the Company and the Administrative
Agent, with the consent of Majority Lenders, may agree). The
Company may request offers to make Money Market Loans for up to
three different Interest Periods in a single notice (for which
purpose Interest Periods in different numbered clauses of the
definition of the term "Interest Period" shall be deemed to be
different Interest Periods even if they are coterminous); provided
that the request for each separate Interest Period shall be deemed
to be a separate Money Market Quote Request for a separate
borrowing (but for purposes of determining any administrative
agency fees payable to the Administrative Agent in respect of same,
such a request shall be deemed to be a request for only one Money
Market borrowing). Each such notice shall be substantially in the
form of Exhibit D hereto and shall specify as to each Money Market
borrowing:
(i) the proposed date of such borrowing, which shall be
a Business Day;
(ii) the aggregate amount of such borrowing, which shall
be at least $5,000,000 (or in larger multiples of $1,000,000)
but shall not cause the limits specified in Section 2.01(c)
hereof to be violated;
(iii) the duration of the Interest Period applicable
thereto;
(iv) whether the Money Market Quotes requested are to set
forth a Money Market Margin or a Money Market Rate; and
(v) if the Money Market Quotes requested are to set
forth a Money Market Rate, the date on which the Money Market
Quotes are to be submitted if it is before the proposed date
of borrowing (the date on which such Money Market Quotes are
to be submitted is called the "Quotation Date").
Except as otherwise provided in this Section 3.03(a), no Money
Market Quote Request shall be given within five Business Days (or
such other number of days as the Company and the Administrative
Agent, with the consent of the Majority Lenders, may agree) of any
other Money Market Quote Request.
(b) (i) Each Lender may submit one or more Money Market
Quotes, each containing an offer to make a Money Market Loan in
response to any Money Market Quote Request; provided that, if the
Company's request under Section 3.03(a) hereof specifies more than
one Interest Period, such Lender may make a single submission
containing one or more Money Market Quotes for each such Interest
Period. Each Money Market Quote must be submitted to the
Administrative Agent not later than (x) 2:00 p.m. New York time on
the fourth Business Day prior to the proposed date of borrowing, in
the case of a LIBOR Auction or (y) 10:00 a.m. New York time on the
Quotation Date, in the case of a Set Rate Auction (or, in any such
case, such other time and date as the Company and the
Administrative Agent, with the consent of the Majority Lenders, may
agree); provided that any Money Market Quote submitted by Chase (or
its Applicable Lending Office) may be submitted, and may only be
submitted, if Chase (or such Applicable Lending Office) notifies
the Company of the terms of the offer contained therein not later
than (x) 1:00 p.m. New York time on the fourth Business Day prior
to the proposed date of borrowing, in the case of a LIBOR Auction
or (y) 9:45 a.m. New York time on the Quotation Date, in the case
of a Set Rate Auction. Subject to Sections 6.02(b), 6.03, 7 and 10
hereof, any Money Market Quote so made shall be irrevocable except
with the written consent of the Administrative Agent given on the
written instructions of the Company.
(ii) Each Money Market Quote shall be substantially in
the form of Exhibit E hereto and shall specify:
(A) the proposed date of borrowing and the Interest
Period therefor;
(B) the principal amount of the Money Market Loan
for which each such offer is being made, which principal
amount shall be at least $5,000,000 or a larger multiple
of $1,000,000; provided that the aggregate principal
amount of all Money Market Loans for which a Lender
submits Money Market Quotes (x) may be greater or less
than the Working Capital Commitment of such Lender but
(y) may not exceed the principal amount of the borrowing
for which offers were requested;
(C) in the case of a LIBOR Auction, the margin
above or below the applicable Eurodollar Rate (the "Money
Market Margin") offered for each such Money Market Loan,
expressed as a percentage (rounded upwards, if necessary,
to the nearest 1/10,000th of 1%) to be added to or
subtracted from the applicable Eurodollar Rate;
(D) in the case of a Set Rate Auction, the rate of
interest per annum (rounded upwards, if necessary, to the
nearest 1/10,000th of 1%) offered for each such Money
Market Loan (the "Money Market Rate"); and
(E) the identity of the quoting Lender.
Unless otherwise agreed by the Administrative Agent and the
Company, no Money Market Quote shall contain qualifying,
conditional or similar language or propose terms other than or in
addition to those set forth in the applicable Money Market Quote
Request and, in particular, no Money Market Quote may be
conditioned upon acceptance by the Company of all (or some
specified minimum) of the principal amount of the Money Market Loan
for which such Money Market Quote is being made.
(c) The Administrative Agent shall (x) in the case of a
Set Rate Auction, as promptly as practicable after the Money Market
Quote is submitted (but in any event not later than 10:15 a.m. New
York time) or (y) in the case of a LIBOR Auction, by 4:00 p.m. New
York time on the day a Money Market Quote is submitted, notify the
Company of the terms (i) of any Money Market Quote submitted by a
Lender that is in accordance with Section 3.03(b) hereof and (ii)
of any Money Market Quote that amends, modifies or is otherwise
inconsistent with a previous Money Market Quote submitted by such
Lender with respect to the same Money Market Quote Request. Any
such subsequent Money Market Quote shall be disregarded by the
Administrative Agent unless such subsequent Money Market Quote is
submitted solely to correct a manifest error in such former Money
Market Quote. The Administrative Agent's notice to the Company
shall specify (A) the aggregate principal amounts of the Money
Market borrowing for which offers have been received and (B) the
respective principal amounts and Money Market Margins or Money
Market Rates, as the case may be, so offered by each Lender
(identifying the Lender that made each Money Market Quote).
(d) Not later than 11:00 a.m. New York time on (x) the
third Business Day prior to the proposed date of borrowing, in the
case of a LIBOR Auction or (y) the Quotation Date, in the case of
a Set Rate Auction (or, in any such case, such other time and date
as the Company and the Administrative Agent, with the consent of
the Majority Lenders, may agree), the Company shall notify the
Administrative Agent of its acceptance or nonacceptance of the
offers so notified to it pursuant to Section 3.03(c) hereof (and
the failure of the Company to give such notice by such time shall
constitute nonacceptance) and the Administrative Agent shall
promptly notify each affected Lender. In the case of acceptance,
such notice shall specify the aggregate principal amount of offers
for each Interest Period that are accepted. The Company may accept
any Money Market Quote in whole or in part (provided that any Money
Market Quote accepted in part shall be at least $5,000,000 or in
larger multiples of $1,000,000); provided that:
(i) the aggregate principal amount of each Money Market
borrowing may not exceed the applicable amount set forth in
the related Money Market Quote Request;
(ii) the aggregate principal amount of each Money Market
borrowing shall be at least $5,000,000 (or in larger multiples
of $1,000,000) but shall not cause the limits specified in
Section 2.01(c) hereof to be violated;
(iii) acceptance of offers may be made only in ascending
order of Money Market Margins or Money Market Rates, as the
case may be; and
(iv) the Company may not accept any offer where the
Administrative Agent has advised the Company that such offer
fails to comply with Section 3.03(b)(ii) hereof or otherwise
fails to comply with the requirements of this Agreement
(including, without limitation, Section 2.01(c) hereof).
If offers are made by two or more Lenders with the same Money
Market Margins or Money Market Rates, as the case may be, for a
greater aggregate principal amount than the amount in respect of
which offers are accepted for the related Interest Period, the
principal amount of Money Market Loans in respect of which such
offers are accepted shall be allocated by the Company among such
Lenders as nearly as possible (in multiples of $1,000,000) in
proportion to the aggregate principal amount of such offers.
Determinations by the Company of the amounts of Money Market Loans
shall be conclusive in the absence of manifest error.
(e) Any Lender whose offer to make any Money Market Loan
has been accepted shall, not later than 1:00 p.m. New York time on
the date specified for the making of such Loan, make the amount of
such Loan available to the Administrative Agent at the Principal
Office in immediately available funds, for account of the Company.
The amount so received by the Administrative Agent shall, subject
to the terms and conditions of this Agreement, be made available to
the Company on such date by depositing the same, in immediately
available funds, in an account of the Company maintained with Chase
at the Principal Office designated by the Company.
Section 4. Payments of Principal and Interest.
4.01 Repayment of Loans.
(a) The Working Capital Loans (including any outstanding
Swing Loans) shall mature on the last day of the Working
Capital Availability Period.
(b) The Money Market Loans shall mature on the last day
of the Interest Period applicable thereto.
4.02 Interest. The Company will pay to the
Administrative Agent for the account of each Lender interest on the
unpaid principal amount of each Loan made by such Lender for the
period commencing on the date of such Loan to but excluding the
date such Loan shall be paid in full, at the following rates per
annum:
(a) if such Loan is a Base Rate Loan, the Base Rate plus
the Applicable Margin;
(b) if such Loan is a Eurodollar Loan, the Eurodollar
Rate plus the Applicable Margin;
(c) if such Loan is a CD Loan, the Adjusted CD Rate plus
the Applicable Margin;
(d) if such Loan is a LIBOR Market Loan, the Eurodollar
Rate plus (or minus) the Money Market Margin quoted by the
Lender making such Loan in accordance with Section 3.03
hereof; and
(e) if such Loan is a Set Rate Loan, the Money Market
Rate for such Loan for the Interest Period therefor quoted by
the Lender making such Loan in accordance with Section 3.03
hereof.
Notwithstanding any of the foregoing, the Company will pay to the
Administrative Agent for the account of each Lender interest at the
applicable Post-Default Rate on any principal of any Loan made by
such Lender, on any Reimbursement Obligation and on any other
amount payable by the Company hereunder to or for the account of
such Lender (but, if such amount is interest, only to the extent
legally enforceable), which shall not be paid in full when due
(whether at stated maturity, by acceleration or otherwise), for the
period commencing on the due date thereof until the same is paid in
full.
Accrued interest on each Loan shall be payable (i) if
such Loan is a Base Rate Loan, on each Quarterly Date, (ii) if such
Loan is a Eurodollar Loan, CD Loan or Money Market Loan, on the
last day of the Interest Period for such Loan (and, if such
Interest Period exceeds 90 days (in the case of a CD Loan or a Set
Rate Loan) or three months' duration (in the case of a Eurodollar
or LIBOR Market Loan), quarterly, commencing on the first quarterly
anniversary of the first day of such Interest Period), and (iii) in
any event, upon the payment, prepayment or conversion thereof, but
only on the principal so paid or prepaid or converted; provided
that interest payable at the Post-Default Rate shall be payable
from time to time on demand of the Administrative Agent or the
Majority Lenders. Promptly after the determination of any interest
rate provided for herein or any change therein, the Administrative
Agent shall notify the Lenders and the Company thereof.
Notwithstanding the foregoing provisions of this Section
4.02, if at any time the rate of interest set forth above on any
Loan of any Lender (the "Stated Rate" for such Loan) exceeds the
maximum non-usurious interest rate permissible for such Lender to
charge commercial borrowers under applicable law (the "Maximum
Rate" for such Lender), the rate of interest charged on such Loan
of such Lender hereunder shall be limited to the Maximum Rate for
such Lender.
In the event the Stated Rate for any Loan of a Lender
that has theretofore been subject to the preceding paragraph at any
time is less than the Maximum Rate for such Lender, the principal
amount of such Loan shall bear interest at the Maximum Rate for
such Lender until the total amount of interest paid to such Lender
or accrued on its Loans hereunder equals the amount of interest
which would have been paid to such Lender or accrued on such
Lender's Loans hereunder if the Stated Rate had at all times been
in effect.
In the event, upon payment in full of all amounts payable
hereunder, the total amount of interest paid to any Lender or
accrued on such Lender's Loans under the terms of this Agreement is
less than the total amount of interest which would have been paid
to such Lender or accrued on such Lender's Loans if the Stated Rate
had, at all times, been in effect, then the Company shall, to the
extent permitted by applicable law, pay to the Administrative Agent
for the account of such Lender an amount equal to the difference
between (a) the lesser of (i) the amount of interest which would
have accrued on such Lender's Loans if the Maximum Rate for such
Lender had at all times been in effect or (ii) the amount of
interest which would have accrued on such Lender's Loans if the
Stated Rate had at all times been in effect and (b) the amount of
interest actually paid to such Lender or accrued on its Loans under
this Agreement.
In the event any Lender ever receives, collects or
applies as interest any sum in excess of the Maximum Rate for such
Lender, such excess amount shall be applied to the reduction of the
principal balance of its Loans or to other amounts (other than
interest) payable hereunder, and if no such principal is then
outstanding, such excess or part thereof remaining shall be paid to
the Company.
Section 5. Payments; Pro Rata Treatment; Computations;
Etc.
5.01 Payments. Except to the extent otherwise provided
herein, all payments of principal, interest, Reimbursement
Obligations and other amounts to be made by the Company hereunder
and under the Notes shall be made in Dollars, in immediately
available funds, to the Administrative Agent at the Principal
Office, not later than 11:00 a.m. New York time on the date on
which such payment shall become due (each such payment made after
such time on such due date to be deemed to have been made on the
next succeeding Business Day). The Administrative Agent, or any
Lender for whose account any such payment is made, may (but shall
not be obligated to) debit the amount of any such payment which is
not made by such time to any ordinary deposit account of the
Company with the Administrative Agent or such Lender, as the case
may be. The Company shall, at the time of making each payment
hereunder or under any Note, specify to the Administrative Agent
the Loans or other amounts payable by the Company hereunder to
which such payment is to be applied (and in the event that it fails
to so specify, or if an Event of Default has occurred and is
continuing, the Administrative Agent may apply such payment as it
may elect in its sole discretion, but subject to the other terms
and conditions of this Agreement, including without limitation,
Section 5.02 hereof). Each payment received by the Administrative
Agent hereunder or under any Note for the account of a Lender shall
be paid promptly to such Lender, in immediately available funds,
for the account of such Lender's Applicable Lending Office. If the
due date of any payment hereunder or under any Note would otherwise
fall on a day which is not a Business Day such date shall be
extended to the next succeeding Business Day and interest shall be
payable for any principal so extended for the period of such
extension.
5.02 Pro Rata Treatment. Except to the extent otherwise
provided herein: (a) each borrowing from the Lenders under Section
2.01(a) hereof shall be made from the Lenders, each payment of
facility fees under Section 2.04 hereof shall be made for the
account of the Lenders, and each termination or reduction of the
Working Capital Commitments under Section 2.03 hereof shall be
applied to the Working Capital Commitments of the Lenders, pro rata
according to the Lenders' respective percentages of the Working
Capital Commitments, provided that borrowings, payments and
prepayments of Swing Loans shall be for Chase's own account; (b)
each payment by the Company of principal of or interest on Working
Capital Loans of a particular Type (other than payments in respect
of Working Capital Loans of individual Lenders provided for by
Section 6 hereof) shall be made to the Administrative Agent for the
account of the Lenders pro rata in accordance with the respective
unpaid principal amounts of such Working Capital Loans held by the
Lenders; (c) each conversion of Working Capital Loans of a
particular Type (other than conversions of Working Capital Loans of
individual Lenders pursuant to Section 6.04 hereof) shall be made
pro rata among the Lenders in accordance with the respective
principal amounts of such Working Capital Loans held by the
Lenders; (d) each Syndicated Letter of Credit will be issued by the
Lenders severally and ratably among the Lenders in accordance with
their respective Working Capital Commitment Percentages and (e) the
Lenders (other than Chase) shall purchase from Chase participations
in the Participation Letters of Credit to the extent of their
respective Working Capital Commitment Percentages.
5.03 Computations. Interest on Money Market Loans and
Fixed Rate Loans and fees shall be computed on the basis of a year
of 360 days and actual days elapsed (including the first day but
excluding the last day) occurring in the period for which payable
and interest on Base Rate Loans shall be computed on the basis of
a year of 365 or 366 days, as the case may be, and actual days
elapsed (including the first day but excluding the last day)
occurring in the period for which payable.
5.04 Minimum and Maximum Amounts; Types. Except for
prepayments made pursuant to Section 3.02(b) hereof, each
borrowing, conversion and prepayment of principal of Working
Capital Loans shall be in an aggregate principal amount equal to
$5,000,000 or a larger multiple of $1,000,000 (borrowings,
conversions or prepayments of Working Capital Loans of different
Types or, in the case of Fixed Rate Loans, having different
Interest Periods, at the same time hereunder to be deemed separate
borrowings, conversions and prepayments for purposes of the
foregoing, one for each Type or Interest Period) (except that any
borrowing of Working Capital Loans may be in the aggregate amount
of the unused portion of the Working Capital Commitments).
Borrowings and prepayments of Swing Loans shall be in a principal
amount at least equal to $100,000. Notwithstanding anything to the
contrary contained in this Agreement there shall not be, at any one
time, more than six Interest Periods in effect with respect to
Fixed Rate Loans. All Swing Loans shall be made as Base Rate
Loans; all other Working Capital Loans may be made as Base Rate
Loans, CD Loans or Eurodollar Loans as specified in the relevant
notice delivered pursuant to Section 5.05.
5.05 Certain Notices. Except as specified in Section
3.03 with respect to Money Market Loans, notices to the
Administrative Agent of terminations or reductions of Working
Capital Commitments, of borrowings, conversions and prepayments of
Loans and of the duration of Interest Periods shall be irrevocable
and shall be effective only if received by the Administrative Agent
not later than 12:00 noon New York time on the number of Business
Days prior to the date of the relevant termination, reduction,
borrowing, conversion and/or prepayment specified below:
Number of
Business
Notice Days Prior
Termination or reduction of Commitments 1
Borrowing or prepayment of Swing Loans same day
Borrowing or prepayment of Base Rate Loans same day
Borrowing or prepayment of, conversion of or
into, or duration of Interest Period
for, Eurodollar Loans 3
Borrowing or prepayment of, conversion
of or into, or duration of Interest
Period for CD Loans 2
Prepayments required pursuant to Section 3.02(b) 1
Each such notice of termination or reduction shall specify the
amount of the Working Capital Commitments to be terminated or
reduced. Each such notice of borrowing, conversion or prepayment
shall specify the amount and Type of the Loans to be borrowed,
converted or prepaid (subject to Sections 3.02(a) and 5.04 hereof),
the date of borrowing, conversion or prepayment (which shall be a
Business Day) and, in the case of Fixed Rate Loans, the duration of
the Interest Period therefor (subject to the definition of Interest
Period). Each such notice of duration of an Interest Period shall
specify the Loans to which such Interest Period is to relate. The
Administrative Agent shall promptly notify the affected Lenders of
the contents of each such notice. In the event that the Company
fails to select the duration of any Interest Period for any Fixed
Rate Loans within the time period and otherwise as provided in this
Section 5.05, such Loans (if outstanding as Fixed Rate Loans) will
be automatically converted into Base Rate Loans on the last day of
the then current Interest Period for such Loans or (if outstanding
as Base Rate Loans) will remain as, or (if not then outstanding)
will be made as, Base Rate Loans.
5.06 Non-Receipt of Funds by the Administrative Agent.
Unless the Administrative Agent shall have been notified by a
Lender or the Company (the "Payor") prior to the date on which such
Lender is to make payment to the Administrative Agent of the
proceeds of a Loan to be made by it hereunder (or the proceeds of
a drawing to be paid by such Lender under any Syndicated Letter of
Credit or the payment of any amount by such Lender to reimburse
Chase for a drawing under any Participation Letter of Credit) or
the Company is to make a payment to the Administrative Agent for
the account of one or more of the Lenders, as the case may be (such
payment being herein called the "Required Payment"), which notice
shall be effective upon receipt, that the Payor does not intend to
make the Required Payment to the Administrative Agent, the
Administrative Agent may assume that the Required Payment has been
made and may, in reliance upon such assumption (but shall not be
required to), make the amount thereof available to the intended
recipient on such date and, if the Payor has not in fact made the
Required Payment to the Administrative Agent, the recipient of such
payment (or, if such recipient is the beneficiary of a Letter of
Credit, the Company and, if the Company fails to pay the amount
thereof to the Administrative Agent forthwith upon demand, and
unless such Letter of Credit is a Swing Letter of Credit, the
Lenders ratably in proportion to their respective Working Capital
Percentages) shall, on demand, pay to the Administrative Agent the
amount made available to it together with interest thereon in
respect of the period commencing on the date such amount was so
made available by the Administrative Agent until the date the
Administrative Agent recovers such amount at a rate per annum equal
to the Federal Funds Rate for such period.
5.07 Sharing of Payments, Etc. The Company agrees that,
in addition to (and without limitation of) any right of set-off,
bankers' lien or counterclaim a Lender (or any bank controlled by
such Lender) may otherwise have, each Lender (or any bank
controlled by such Lender) shall be entitled, at its option, to
offset balances held by it for the account of the Company at any of
its offices, in Dollars or in any other currency, against any
principal of or interest on any of such Lender's Loans to the
Company hereunder, or any Reimbursement Obligation or other
obligation of the Company hereunder, which is not paid when due
(regardless of whether such balances are then due to the Company),
in which case it shall promptly notify the Company and the
Administrative Agent thereof, provided that such Lender's failure
to give such notice shall not affect the validity thereof. If a
Lender (or any bank controlled by such Lender) shall obtain payment
of any principal of or interest on any Working Capital Loans made
by it under this Agreement, or on any Reimbursement Obligation or
other obligation then due to such Lender hereunder, through the
exercise of any right of set-off, banker's lien, counterclaim or
similar right, or otherwise, such Lender shall promptly purchase
from the other Lenders participations in the Working Capital Loans
made, or Reimbursement Obligations or other obligations held, by
the other Lenders in such amounts, and make such other adjustments
from time to time as shall be equitable to the end that all the
Lenders shall share the benefit of such payment (net of any
expenses which may be incurred by such Lender in obtaining or
preserving such benefit) pro rata in accordance with the unpaid
principal and interest on the Working Capital Loans and
Reimbursement Obligations or other obligations then due to each of
them. To such end all the Lenders shall make appropriate
adjustments among themselves (by the resale of participations sold
or otherwise) if such payment is rescinded or must otherwise be
restored. The Company agrees, to the fullest extent it may
effectively do so under applicable law, that any Person purchasing
a participation in the Working Capital Loans made, or Reimbursement
Obligations or other obligations held, by another Person, whether
or not acquired pursuant to the foregoing arrangements, may
exercise all rights of set-off, bankers' lien, counterclaim or
similar rights with respect to such participation as fully as if
such Lender were a direct holder of Loans and Reimbursement
Obligations or other obligations in the amount of such
participation. Nothing contained herein shall require any Lender
to exercise any such right or shall affect the right of any Lender
to exercise, and retain the benefits of exercising, any such right
with respect to any other indebtedness or obligation of the
Company.
Section 6. Yield Protection and Illegality
6.01 Additional Costs.
(a) The Company shall pay to the Administrative Agent
for the account of each Lender from time to time such amounts as
such Lender may determine to be necessary to compensate it for any
costs incurred by such Lender which such Lender determines are
attributable to its making or maintaining of any Fixed Rate Loans
hereunder or its obligation to make any of such Loans hereunder, or
any reduction in any amount receivable by such Lender hereunder in
respect of any of such Loans or such obligation (such increases in
costs and reductions in amounts receivable being herein called
"Additional Costs"), in each case resulting from any Regulatory
Change which:
(i) changes the basis of taxation of any amounts payable
to such Lender under this Agreement or its Notes in respect of
any of such Loans (other than changes which affect taxes
measured by or imposed on the overall net income of such
Lender or of its Applicable Lending Office for any of such
Loans by the jurisdiction in which such Lender has its
principal office or such Applicable Lending Office); or
(ii) imposes or modifies any reserve, special deposit,
insurance assessment or similar requirements relating to any
extensions of credit or other assets of, or any deposits with
or other liabilities of, such Lender (including any of such
Loans or any deposits referred to in the definitions of "CD
Base Rate" or "Eurodollar Base Rate" in Section 1.01 hereof);
or
(iii) imposes any other condition affecting this Agreement
(or any of such extensions of credit or liabilities).
Each Lender will notify the Company through the Administrative
Agent of any event occurring after the date of this Agreement which
will entitle such Lender to compensation pursuant to this Section
6.01(a) as promptly as practicable after it obtains knowledge
thereof and determines to request such compensation, and (if so
requested by the Company through the Administrative Agent) will
designate a different Applicable Lending Office for the relevant
Type of Fixed Rate Loans of such Lender if such designation will
avoid the need for, or reduce the amount of, such compensation and
will not, in the sole opinion of such Lender, be disadvantageous to
such Lender (provided that such Lender shall have no obligation to
so designate an Applicable Lending Office located in the United
States of America). Each Lender will furnish the Company with a
statement setting forth the basis and amount of each request by
such Lender for compensation under this Section 6.01(a). If any
Lender requests compensation from the Company under this Section
6.01(a), the Company may, by notice to such Lender through the
Administrative Agent, suspend the obligation of such Lender to make
additional Fixed Rate Loans of the relevant Type to the Company
until the Regulatory Change giving rise to such request ceases to
be in effect (in which case the provisions of Section 6.04 hereof
shall be applicable).
(b) Without limiting the effect of the foregoing
provisions of this Section 6.01, in the event that, by reason of
any Regulatory Change, any Lender either (i) incurs Additional
Costs based on or measured by the excess above a specified level of
the amount of a category of deposits or other liabilities of such
Lender which includes deposits by reference to which the interest
rate on any Type of Fixed Rate Loans is determined as provided in
this Agreement or a category of extensions of credit or other
assets of such Lender which includes any Type of Fixed Rate Loans
or (ii) becomes subject to restrictions on the amount of such a
category of liabilities or assets which it may hold, then, if such
Lender so elects by notice to the Company (with a copy to the
Administrative Agent), the obligation of such Lender to make Fixed
Rate Loans of the relevant Type hereunder shall be suspended until
the date such Regulatory Change ceases to be in effect (in which
case the provisions of Section 6.04 hereof shall be applicable).
(c) Determinations and allocations by any Lender for
purposes of this Section 6.01 of the effect of any Regulatory
Change on its costs of maintaining its obligations to make Loans or
of making or maintaining Loans or on amounts receivable by it in
respect of Loans, and of the additional amounts required to
compensate such Lender in respect of any Additional Costs, shall be
conclusive absent manifest error, provided that such determinations
and allocations are made on a reasonable basis.
6.02 Limitation on Types of Loans. Anything herein to
the contrary notwithstanding, if, with respect to any Fixed Rate
Loans:
(a) the Administrative Agent determines (which
determination shall be conclusive) that quotations of interest
rates for the relevant deposits referred to in the definitions
of "CD Base Rate" or "Eurodollar Base Rate" in Section 1.01
hereof, as the case may be, are not being provided for the
relevant maturities for purposes of determining the rate of
interest for such Loans for Interest Periods therefor as
provided in this Agreement; or
(b) the Majority Lenders determine (which determination
shall be conclusive) and notify the Administrative Agent that
the relevant rates of interest referred to in the definitions
of "CD Base Rate" or "Eurodollar Base Rate" in Section 1.01
hereof, as the case may be, upon the basis of which the rates
of interest for such Loans are to be determined do not
accurately reflect the cost to such Lenders of making or
maintaining such Loans for Interest Periods therefor;
then the Administrative Agent shall promptly notify the Company and
each Lender thereof, and so long as such condition remains in
effect, the Lenders shall be under no obligation to make Fixed Rate
Loans of the relevant Type or to convert Base Rate Loans into Fixed
Rate Loans of the relevant Type and the Company shall, on the last
day(s) of the then current Interest Period(s) for the outstanding
Fixed Rate Loans of the relevant Type, either prepay such Loans or
convert such Loans into Base Rate Loans in accordance with Section
3.02 hereof.
6.03 Illegality. Notwithstanding any other provision of
this Agreement to the contrary, in the event that it becomes
unlawful for any Lender or its Applicable Lending Office to (a)
honor its obligation to make Fixed Rate Loans of any Type
hereunder, or (b) maintain Fixed Rate Loans of any Type hereunder,
then such Lender shall promptly notify the Company thereof through
the Administrative Agent and such Lender's obligation to make Fixed
Rate Loans of such Type hereunder shall be suspended until such
time as such Lender may again make and maintain Fixed Rate Loans of
such Type (in which case the provisions of Section 6.04 hereof
shall be applicable).
6.04 Substitute Base Rate Loans. If the obligation of
any Lender to make Fixed Rate Loans of any Type shall be suspended
pursuant to Section 6.01, 6.02 or 6.03 hereof, all Loans which
would otherwise be made by such Lender as Fixed Rate Loans of such
Type shall be made instead as Base Rate Loans (and, if an event
referred to in Section 6.01(b) or 6.03 hereof has occurred and such
Lender so requests by notice to the Company with a copy to the
Administrative Agent, each Fixed Rate Loan of such Lender then
outstanding shall be automatically converted into a Base Rate Loan
on the date specified by such Lender in such notice) and, to the
extent that Fixed Rate Loans of such Type are so made as (or
converted into) Base Rate Loans, all payments of principal which
would otherwise be applied to such Fixed Rate Loans shall be
applied instead to such Base Rate Loans.
6.05 Compensation. The Company shall pay to the
Administrative Agent for the account of each Lender, upon the
request of such Lender through the Administrative Agent, such
amount or amounts as shall be sufficient (in the reasonable opinion
of such Lender) to compensate it for any loss, cost or expense
incurred by it as a result of:
(a) any payment, prepayment or conversion of a Fixed
Rate Loan or a Set Rate Loan made by such Lender on a date
other than the last day of an Interest Period for such Loan;
or
(b) any failure by the Company to borrow a Fixed Rate
Loan or a Set Rate Loan to be made by such Lender on the date
for such borrowing specified in the relevant notice of
borrowing under Section 5.05 or 3.03 hereof.
6.06 Additional Costs in Respect of Letters of Credit.
If as a result of any Regulatory Change there shall be imposed,
modified or deemed applicable any tax, reserve, special deposit or
similar requirement against or with respect to or measured by
reference to Letters of Credit issued or to be issued hereunder or
participations therein, and the result shall be to increase the
cost to any Lender of issuing or maintaining any Letter of Credit
or any participation therein, or reduce any amount receivable by
any Lender hereunder in respect of any Letter of Credit (which
increase in cost, or reduction in amount receivable, shall be the
result of such Lender's reasonable allocation of the aggregate of
such increases or reductions resulting from such event), then, upon
demand by such Lender, the Company agrees to pay to such Lender,
from time to time as specified by such Lender, such additional
amounts as shall be sufficient to compensate such Lender for such
increased costs or reductions in amount. A statement as to such
increased costs or reductions in amount incurred by such Lender,
submitted by such Lender to the Company, shall be conclusive as to
the amount thereof absent manifest error, provided that the
determination thereof is made on a reasonable basis.
6.07 Capital Adequacy. If any Lender shall determine
that the adoption or implementation of any applicable law, rule,
regulation or treaty regarding capital adequacy, or any change
therein, or any change in the interpretation or administration
thereof by any governmental authority, central bank or comparable
agency charged with the interpretation or administration thereof,
or compliance by any Lender (or its Applicable Lending Office) with
any request or directive regarding capital adequacy (whether or not
having the force of law) of any such authority, central bank or
comparable agency, has or would have the effect of reducing the
rate of return on capital of such Lender or any Person controlling
such Lender (a "Parent") as a consequence of its obligations
hereunder to a level below that which such Lender (or its Parent)
could have achieved but for such adoption, change or compliance
(taking into consideration its policies with respect to capital
adequacy) by an amount deemed by such Lender to be material, then
from time to time, within 15 days after demand by such Lender (with
a copy to the Administrative Agent), the Company shall pay to such
Lender such additional amount or amounts as will compensate such
Lender for such reduction. A statement of any Lender claiming
compensation under this Section and setting forth the additional
amount or amounts to be paid to it hereunder shall be conclusive
absent manifest error, provided that the determination thereof is
made on a reasonable basis. In determining such amount, such
Lender may use any reasonable averaging and attribution methods.
6.08 Substitution of Lender. If (i) the obligation of
any Lender to make Fixed Rate Loans has been suspended pursuant to
Section 6.01(b) or 6.03 or (ii) any Lender has demanded
compensation under Section 6.01(a), 6.06 or 6.07, the Company shall
have the right, with the assistance of the Administrative Agent, to
seek a mutually satisfactory substitute lender or lenders (which
may be one or more of the Lenders) to purchase the Working Capital
Loan Note and assume the Working Capital Commitment of such Lender.
Section 7. Conditions Precedent.
7.01 Initial Loans and Letters of Credit. The
obligation of each Lender to make the initial Loans to be made by
it hereunder is subject to the following conditions precedent, each
of which shall have been fulfilled to the satisfaction of the
Administrative Agent:
(a) Corporate Action. The Administrative Agent shall
have received certified copies of the certificate of
incorporation and by-laws of the Company and of all corporate
action taken by the Company authorizing the execution,
delivery and performance of this Agreement and the Notes
(including, without limitation, a certificate of the Company
setting forth the resolutions of its Board of Directors
authorizing the transactions contemplated thereby).
(b) Incumbency. The Company shall have delivered to the
Administrative Agent a certificate in respect of the name and
signature of each of the officers or other employees of the
Company (i) who is authorized to sign on its behalf of this
Agreement and the Notes and (ii) who will, until replaced by
another officer or officers duly authorized for that purpose,
act as its representative for the purposes of signing
documents and giving notices and other communications in
connection with this Agreement and the Notes. The
Administrative Agent and each Lender may conclusively rely on
such certificates until it receives notice in writing from the
Company to the contrary.
(c) Notes. The Administrative Agent shall have received
Working Capital Notes and Money Market Notes for each Lender,
duly completed and executed.
(d) Fees and Expenses. The Company shall have paid to
the Administrative Agent, for its account and for the account
of the Lenders, the fees required by Section 2.04 to be paid
on the Closing Date and shall have in addition paid to the
Administrative Agent all amounts payable under Section 12.03
hereof or otherwise on or before the Closing Date.
(e) Opinion of Counsel to the Company. The
Administrative Agent shall have received an opinion of Jones,
Day, Reavis & Pogue, special New York and Delaware corporate
counsel to the Company, substantially in the form of Exhibit
F hereto covering such other matters relating to the
transactions contemplated hereby as the Majority Lenders may
reasonably request.
(f) Opinions of Special Counsel to the Administrative
Agent. The Administrative Agent shall have received an
opinion of Davis Polk & Wardwell, substantially in the form of
Exhibit G hereto.
(g) Officer's Certificate. The Administrative Agent
shall have received a certificate signed by the chief
financial officer of the Company to the effect that (i) no
Default shall have occurred and be continuing and (ii) each of
the representations and warranties made by the Company or any
Subsidiary in or pursuant to the Basic Documents are true and
correct in all material respects on and as of the Closing
Date.
(h) Counterparts. The Administrative Agent shall have
received counterparts of each of this Agreement executed and
delivered by or on behalf of each of the parties thereto (or,
in the case of any Lender as to which the Administrative Agent
shall not have received such a counterpart, the Administrative
Agent shall have received evidence satisfactory to it of the
execution and delivery by such Lender of a counterpart
hereof).
(i) Existing Credit Agreement. The Administrative Agent
shall have received evidence that, after giving effect to the
application of the proceeds of the initial Loans to be made
hereunder, (i) all amounts outstanding under the Existing
Credit Agreement have been paid in full, (ii) all commitments
thereunder have been terminated, (iii) all notes and letters
of credit (other than the Existing Letters of Credit) issued
pursuant thereto, and all guarantees thereof, have been
cancelled and (iv) all Liens relating thereto have been released.
(j) Other Documents. The Administrative Agent shall
have received such other documents relating to the
transactions contemplated hereby as the Administrative Agent
may reasonably request.
7.02 Initial and Subsequent Loans and Letters of Credit.
The obligation of each Lender to make any Loan to be made by it
hereunder, or to issue any Letter of Credit (including the deemed
issuance of the initial Letters of Credit pursuant to the second
sentence of Section 2.02(a)) is subject to the conditions precedent
that, as of the date of such Loan or such issuance, and before and
after giving effect thereto: (a) no Default shall have occurred and
be continuing; and (b) the representations and warranties made by
the Company in this Agreement shall be true on and as of the date
of the making of such Loan or such issuance, with the same force
and effect as if made on and as of such date (except that any
representation or warranty which is stated to have been made only
as of a specific date shall speak only as of such date). Each
notice of borrowing by the Company hereunder, request for issuance
of a Letter of Credit or Money Market Quote Request shall
constitute a certification by the Company to the effect set forth
in the preceding sentence (both as of the date of such notice or
request and, unless the Company otherwise notifies the
Administrative Agent prior to the date of such borrowing or
issuance, as of the date of such borrowing or issuance).
Section 8. Representations and Warranties. The Company
represents and warrants to the Lenders and the Administrative Agent
as follows:
8.01 Corporate Existence. Each of the Company and 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 all requisite corporate power, and has
all governmental licenses, authorizations, consents and approvals
necessary to own its assets and carry on its business as now being
or as proposed to be conducted, except in the case of such
licenses, authorizations, consents and approvals, where the failure
to obtain them would not have a material adverse effect on the
condition (financial or otherwise), assets, nature of assets,
liabilities (including without limitation, tax, ERISA and
environmental liabilities) or prospects of the Company and its
Subsidiaries taken as a whole; and (c) is qualified to do business
in all jurisdictions in which the nature of the business conducted
by it makes such qualification necessary and where failure so to
qualify would have a material adverse effect on the condition,
(financial or otherwise), assets, nature of assets, liabilities
(including, without limitation, tax, ERISA and environmental
liabilities) or prospects of the Company and its Subsidiaries taken
as a whole.
8.02 Information. (a) The Information Memorandum did
not as of the date thereof and will not as of the Closing Date
contain any untrue statement of a material fact or omit to state a
material fact necessary in order to make the statements contained
therein not misleading; provided that although the management of
the Company believes that the projections presented therein are
reasonable, the Company makes no representation as to their
attainability.
(b) Without limiting the generality of paragraph (a):
(i) The audited consolidated and consolidating balance
sheet of the Company and its Subsidiaries as of December 31,
1993 and the audited consolidated statements of income,
changes in stockholders' equity and cash flow for the fiscal
year ended December 31, 1993 (collectively, the "Financial
Statements"), have been prepared in accordance with generally
accepted accounting principles consistently applied. The
Financial Statements fairly present the financial position of
the Company and its Subsidiaries as of December 31, 1993 and
the results of their operations and their cash flows for the
fiscal year ended December 31, 1993, in conformity with
generally accepted accounting principles.
(ii) The Company and its Subsidiaries did not on the date
of the balance sheet referred to in clause (i) above, and will
not on the Closing Date, have any material contingent
liabilities, material liabilities for taxes, unusual and
material forward or long-term commitments or material
unrealized or anticipated losses from any unfavorable
commitments, except as referred to or reflected or provided
for in said balance sheet (including the footnotes thereto).
(c) The Company has disclosed to the Lenders in writing
any and all facts (other than general economic and industry
conditions) which materially and adversely affect or may affect (to
the extent it can reasonably foresee) the condition (financial or
otherwise), assets, nature of assets, liabilities (including,
without limitation, tax, ERISA and environmental liabilities) or
prospects of the Company and its Subsidiaries, taken as a whole, or
the ability of the Company to perform its obligations under each
Basic Document.
(d) Since December 31, 1993 there has been no material
adverse change in the condition (financial or otherwise), assets,
nature of assets, liabilities (including, without limitation, tax,
ERISA and environmental liabilities) or prospects of the Company or
in the ability of the Company to perform its obligations under each
Basic Document.
8.03 Litigation. There are no legal or arbitral
proceedings or any proceedings by or before any governmental or
regulatory authority or agency, now pending or, to the knowledge of
the Company, threatened against or affecting the Company or any of
its Subsidiaries in which there is a reasonable possibility of an
adverse decision which could have a material adverse effect on the
condition (financial or otherwise), assets, nature of assets,
liabilities (including, without limitation, tax, ERISA and
environmental liabilities) or prospects of the Company and its
Subsidiaries, taken as a whole, or on the ability of the Company to
perform its obligations under each Basic Document.
8.04 No Breach. None of the execution and delivery of
the Basic Documents, the consummation of the transactions therein
contemplated or compliance with the terms and provisions thereof
will conflict with or result in a breach of, or require any consent
under, the certificate of incorporation or by-laws of the Company
or any of its Subsidiaries, or any applicable law or regulation, or
any order, writ, injunction or decree of any court or governmental
authority or agency, or any Basic Document or other material
agreement or instrument to which the Company or any of its
Subsidiaries is a party or by which it is bound or to which it is
subject, or constitute a default under any such agreement or
instrument, or (except for the Liens created pursuant to, or
permitted by, this Agreement) result in the creation or imposition
of any Lien upon any of the revenues or assets of the Company or
any of its Subsidiaries pursuant to the terms of any such agreement
or instrument.
8.05 Corporate Action. The Company has all necessary
corporate power and authority to execute, deliver and perform its
obligations under this Agreement and the Notes; the execution,
delivery and performance by the Company of this Agreement and the
Notes have been duly authorized by all necessary corporate action;
and this Agreement has been duly and validly executed and delivered
by the Company and constitutes the legal, valid and binding
obligation of the Company and, on the Closing Date, each of the
Notes will constitute its legal, valid and binding obligation, in
each case enforceable in accordance with its terms, except as the
enforceability thereof may be limited by bankruptcy, insolvency,
reorganization or moratorium or other similar laws relating to the
enforcement of creditors' rights generally and by general equitable
principles.
8.06 Approvals. The Company has obtained all
authorizations, approvals and consents of, and has made all filings
and registrations with, any governmental or regulatory authority or
agency necessary for the execution, delivery or performance by it
of this Agreement and the Notes, or for the validity or
enforceability thereof.
8.07 Regulations U and X. Neither the Company nor any
of its Subsidiaries is engaged principally, or as one of its
important activities, in the business of extending credit for the
purpose of purchasing or carrying margin stock (within the meaning
of Regulation U or X of the Board of Governors of the Federal
Reserve System) and no part of the proceeds of any Loan hereunder
will be used to purchase or carry any such margin stock.
8.08 ERISA. The Company and each member of the
Controlled Group have fulfilled their obligations under the minimum
funding standards of ERISA and the Code with respect to each Plan
and are in compliance in all material respects with the presently
applicable provisions of ERISA and the Code, and have not incurred
any liability to the PBGC or a Plan under Title IV of ERISA (other
than to make contributions or premium payments in the ordinary
course).
8.09 Taxes. Each of the Company and its Subsidiaries
has filed all United States Federal income tax returns and all
other material tax returns which are required to be filed by it and
has paid all taxes due pursuant to such returns or pursuant to any
assessment received by it, except to the extent the same may be
contested as permitted by Section 9.02 hereof. The charges,
accruals and reserves on the books of the Company and its
Subsidiaries in respect of taxes and other governmental charges
are, in the opinion of the Company, adequate.
8.10 Subsidiaries. Schedule I hereto is a complete and
correct list, as of the Closing Date, of all Subsidiaries of the
Company. The Company owns, free and clear of Liens, all
outstanding shares of its Subsidiaries and all such shares are
validly issued, fully paid and non-assessable and the Company (or
the respective Subsidiary of the Company) also owns, free and clear
of Liens, all such Investments.
8.11 Investment Company Act. Neither the Company nor
any of its Subsidiaries is an investment company within the meaning
of the Investment Company Act of 1940, as amended, or, directly or
indirectly, controlled by or acting on behalf of any Person which
is an investment company, within the meaning of said Act.
8.12 Public Utility Holding Company Act. Neither the
Company nor any of its Subsidiaries is a "holding company", or an
"affiliate" of a "holding company" or a "subsidiary company" of a
"holding company", within the meaning of the Public Utility Holding
Company Act of 1935, as amended.
8.13 Ownership and Use of Properties. Each of the
Company and its Subsidiaries will have on the Closing Date and at
all times thereafter, legal title or ownership of, or the right to
use pursuant to enforceable and valid agreements or arrangements,
all tangible property, both real and personal and all franchises,
licenses, copyrights, patents and know-how which is material to the
operation of its business as proposed to be conducted.
8.14 Environmental Matters. The Company and each of its
Subsidiaries have obtained all permits, certificates, licenses,
approvals, registrations and other authorizations which are
required under all applicable Environmental Laws, except to the
extent failure to have any such permit, certificate, license,
approval, registration or authorization would not result in a
material adverse change in the condition (financial or otherwise),
assets, nature of assets, liabilities (including, without
limitation, environmental liabilities) or prospects of the Company
and its Subsidiaries taken as a whole. The Company and each of its
Subsidiaries are in compliance with the terms and conditions of all
such permits, certificates, licenses, approvals, registrations and
authorizations, and are also in compliance with all other
limitations, restrictions, conditions, standards, prohibitions,
requirements, obligations, schedules and timetables contained in
any applicable Environmental Law or in any notice or demand letter
from any regulatory authority issued, entered, promulgated or
approved thereunder, other than any notices or demand letters which
the Company or such Subsidiary is contesting in good faith, except
to the extent failure to comply would not result in a material
adverse change in the condition (financial or otherwise), assets,
nature of assets, liabilities (including, without limitation,
environmental liabilities) or prospects of the Company and its
Subsidiaries, taken as a whole. The Company and each of its
Subsidiaries is and has been conducting its business so as to
comply in all respects with applicable Environmental Laws, except
to the extent any such failure to so comply would not result in a
material adverse change in the condition (financial or otherwise),
assets, nature of assets, liabilities (including, without
limitation, environmental liabilities), or prospects of the Company
and its Subsidiaries, taken as a whole.
8.15 Subordinated Debt. So long as either Note
Indenture is in effect, (1) all Loans outstanding hereunder and all
Reimbursement Obligations with respect to Letters of Credit then
outstanding hereunder constitute "Senior Debt" as defined in such
Note Indenture and (2) the Company is permitted, pursuant to the
terms of such Note Indenture, to make such borrowing or to incur
the Reimbursement Obligation that might arise with respect to such
Letter of Credit.
8.16. Existing Letters of Credit. Schedule II hereto
identifies each Existing Letter of Credit outstanding as of the
date hereof and as of the Closing Date.
Section 9. Covenants. The Company agrees that, so long
as any of the Working Capital Commitments are in effect and until
payment in full of all Loans hereunder, the termination of all
Letters of Credit and payment in full of all Letter of Credit
Liabilities, all interest thereon and all other amounts payable
hereunder, unless the Majority Lenders shall agree otherwise as
contemplated by Section 12.05 hereof:
9.01 Reports. The Company shall deliver to each of the
Lenders:
(a) as soon as available and in any event within 90 days
after the end of each fiscal year of the Company, consolidated
statements of income, retained earnings and cash flow of the
Company and its Subsidiaries for such year and the related
consolidated balance sheet as at the end of such year, setting
forth in each case in comparative form the corresponding
figures for the preceding fiscal year, and accompanied, in the
case of said consolidated financial statements, by an opinion
thereon of Arthur Andersen & Co. or other independent
certified public accountants of recognized national standing,
which opinion shall state that said consolidated financial
statements fairly present the consolidated financial condition
and results of operations of the Company and its Subsidiaries
as at the end of, and for, such fiscal year and stating that,
in making the examination necessary for their above-described
opinion (but without any special or additional procedures for
that purpose), they obtained no knowledge, except as
specifically stated, of any Default;
(b) as soon as available and in any event within 45 days
after the end of each fiscal quarter of the Company,
consolidated statements of income and cash flow of the Company
and its Subsidiaries and other reports, at the reasonable
request of the Administrative Agent or any Lender, in each
case in a form satisfactory to the Administrative Agent, for
such fiscal quarter and for the portion of the fiscal year
ended at the end of such fiscal quarter, and the related
consolidated balance sheet as at the end of such fiscal
quarter, accompanied, in each case, by a certificate of the
chief financial officer or corporate controller of the
Company, which certificate shall state that said consolidated
financial statements fairly present the consolidated financial
condition and results of operations of the Company in
accordance with GAAP (except for abbreviated footnotes of the
type required by the Securities and Exchange Commission to be
included in quarterly reports on Form 10-Q), consistently
applied, as at the end of, and for, such period (subject to
normal year-end audit adjustments);
(c) prior to the beginning of each fiscal year of the
Company, a copy of the consolidated operating budget,
including, without limitation, projection of the anticipated
cash flow, of the Company and its Subsidiaries, such budget to
be accompanied by a certificate of the chief financial officer
or corporate controller of the Company specifying the
assumptions on which such budget was prepared, stating that
such officer has no reason to question the reasonableness of
any material assumptions on which such budget was prepared and
providing such other details as the Administrative Agent may
reasonably request;
(d) promptly upon the mailing thereof to the
shareholders of the Company generally, copies of all financial
statements, reports and proxy statements so mailed;
(e) promptly upon the filing thereof, copies of all
registration statements (other than any registration
statements on Form S-8 or its equivalent) and any reports
which the Company shall have filed with the Securities and
Exchange Commission;
(f) if and when the Company or any member of the
Controlled Group (i) gives or is required to give notice to
the PBGC of any "reportable event" (as defined in Section 4043
of ERISA) with respect to any Plan which might constitute
grounds for a termination of such Plan under Title IV of
ERISA, or knows that the plan administrator of any Plan has
given or is required to give notice of any such reportable
event, a copy of the notice of such reportable event given or
required to be given to the PBGC, (ii) receives notice of
complete or partial withdrawal liability under Title IV of
ERISA, a copy of such notice; or (iii) receives notice from
the PBGC under Title IV of ERISA of an intent to terminate or
appoint a trustee to administer the Plan, a copy of such
notice;
(g) promptly following the delivery thereof to the
Company or to the Board of Directors or management of the
Company, a copy of any management letter or written report by
independent public accountants with respect to the financial
condition, operations, business or prospects of the Company;
(h) promptly after management of the Company knows that
any Default has occurred and is continuing, a notice of such
Default, describing the same in reasonable detail; and
(i) from time to time such other information regarding
the financial condition, operations, prospects or business of
the Company as the Administrative Agent or any Lender through
the Administrative Agent may reasonably request.
The Company will furnish to each Lender, at the time it furnishes
each set of financial statements pursuant to paragraph (a) or (b)
above, a certificate of its chief executive officer, chief
financial officer or corporate controller (i) to the effect that,
to the best of his knowledge after due inquiry, no Default has
occurred and is continuing (or, if any Default has occurred and is
continuing, describing the same in reasonable detail) and (ii)
setting forth in reasonable detail the computations necessary to
determine whether it was in compliance with Sections 9.08 to 9.16
inclusive, hereof as of the end of the respective fiscal quarter or
fiscal year.
9.02 Taxes and Claims. The Company will pay and
discharge, and will cause each of its Subsidiaries to pay and
discharge, all material taxes, assessments and governmental charges
or levies imposed upon it or upon its income or profits, or upon
any property belonging to it, prior to the date on which penalties
attach thereto, and all lawful claims which, if unpaid, might
become a Lien upon the property of the Company or such Subsidiary,
provided that neither the Company nor such Subsidiary shall be
required to pay any such tax, assessment, charge, levy or claim the
payment of which is being contested in good faith and by proper
proceedings if it maintains adequate reserves with respect thereto.
9.03 Insurance. The Company will maintain, and will
cause each of its Subsidiaries to maintain:
(1) Physical damage insurance on all tangible real and
personal property and improvements of the Company and its
Subsidiaries on an all risks basis, covering the repair and
replacement cost of all such property and consequential loss
coverage for business interruption and extra expense, covering such
risks, in an amount in no event less than the greater of (x) the
aggregate amount of the Working Capital Commitments and (y) the
amounts necessary to avoid the insured named therein from becoming
a co-insurer of any loss under such policy.
(2) Comprehensive general liability insurance in at
least such amounts and against at least such risks as are usually
insured against by companies of established repute engaged in the
same or similar business, owning similar properties, and located in
the same general areas as the Company and its Subsidiaries.
(3) Such other insurance in such amounts and against
such risks as is usually carried by companies of established repute
engaged in the same or similar business, owning similar properties,
and located in the same general areas as the Company and its
Subsidiaries.
All such insurance shall be written by financially
responsible companies of established repute selected by the Company
that customarily write insurance for the risks covered thereby in
the amounts contemplated thereby.
On the Closing Date the Company will deliver to the
Administrative Agent certificates of insurance satisfactory to the
Administrative Agent evidencing the existence of all insurance
required to be maintained by the Company hereunder and showing the
termination or expiry date of such insurance.
9.04 Maintenance of Existence; Conduct of Business. The
Company will preserve and maintain, and will cause each of its
Subsidiaries to preserve and maintain, its corporate existence and
all of its rights, privileges and franchises necessary or desirable
in the normal conduct of its business, and will conduct its
business in a regular manner; provided that nothing herein shall
prevent the merger and dissolution of any Subsidiary of the Company
into the Company so long as the Company is the surviving
corporation or the sale of a Subsidiary as permitted under Section
9.13.
9.05 Maintenance of and Access to Properties. The
Company will keep, and will cause each of its Subsidiaries to keep,
all of its properties necessary in its business in good working
order and condition (having regard to the condition of such
properties at the time such properties were acquired by the Company
or such Subsidiary), ordinary wear and tear excepted, and will
permit representatives of the Lenders to inspect such properties
and, upon reasonable notice and at reasonable times, to examine and
make extracts and copies from the books and records of the Company
and any such Subsidiary.
9.06 Compliance with Applicable Laws. The Company will
comply, and will cause each of its Subsidiaries to comply, with the
requirements of all applicable laws, rules, regulations and orders
of any governmental body or regulatory authority (including,
without limitation, all Environmental Laws), a breach of which
would have a material adverse effect on the condition (financial or
otherwise), assets, nature of assets, liabilities (including,
without limitation, tax, ERISA and environmental liabilities) or
prospects of the Company and its Subsidiaries, taken as a whole,
except where contested in good faith and by proper proceedings.
9.07 Litigation. The Company will promptly give to the
Administrative Agent (which shall promptly notify each Lender)
notice in writing of (i) all judgments against it or any of its
Subsidiaries which individually exceed $1,000,000 or in the
aggregate exceed $5,000,000 and (ii) all litigation and of all
proceedings of which it is aware before any courts, arbitrators or
governmental or regulatory agencies affecting the Company or any of
its Subsidiaries except litigation or proceedings which, if
adversely determined, would not in the reasonable opinion of the
Company materially and adversely affect the condition (financial or
otherwise), assets, nature of assets, liabilities (including,
without limitation, tax, ERISA and environmental liabilities) or
prospects of the Company and its Subsidiaries, taken as a whole.
9.08 Current Ratio. The Company will not permit the
ratio of (i) consolidated current assets of the Company and its
Subsidiaries to (ii) consolidated current liabilities of the
Company and its Subsidiaries at any time to be less than 1.25 to
1.0. For purposes of this Section 9.08, the terms "consolidated
current assets" and "consolidated current liabilities" shall have
the respective meanings assigned to them by GAAP, provided that
there shall be excluded from consolidated current assets all cash
and cash equivalents and all prepaid expenses and that there shall
be excluded from consolidated current liabilities the currently
maturing portion of all long-term Indebtedness of the Company and
its Subsidiaries and accrued interest expense.
9.09 Indebtedness. The Company will not, and will not
permit any of its Subsidiaries to, create, incur or suffer to exist
any Indebtedness except: (i) Indebtedness to the Lenders
hereunder; (ii) Subordinated Indebtedness; (iii) the Gallman
Indebtedness; and (iv) other Indebtedness in an aggregate amount at
any time outstanding not to exceed $20,000,000.
9.10 Leverage Ratio. The Company will not permit the
ratio, calculated as at the end of each fiscal quarter for the four
fiscal quarters then ended, of (i) the principal amount of Funded
Indebtedness of the Company and its Subsidiaries at such date to
(ii) Cash Flow for such period to exceed 3.50 to 1.0.
9.11 Interest Coverage Ratio. The Company will not
permit the ratio, calculated as at the end of each fiscal quarter
for the four fiscal quarters then ended, of Cash Flow for such
period to Interest Expense for such period to be less than 2.50 to
1.0.
9.12 Fixed Charges Coverage Ratio. The Company will not
permit the ratio, calculated as at the end of each fiscal quarter
for the four fiscal quarters then ended, of (i) Adjusted Cash Flow
for such period minus Adjusted Capital Expenditures for such period
to (ii) Regular Debt Service for such period plus the aggregate
amount of Restricted Payments made during such period to be less
than 1.10 to 1.0. For purposes of computation of the ratio,
Adjusted Cash Flow shall be increased by the lesser of (x)
$20,000,000 and (y) the amount by which the Working Capital
Commitments on such date exceed the aggregate amount of all Working
Capital Obligations on such date.
9.13 Mergers, Asset Dispositions and Acquisitions, Etc.
(a) The Company will not, and will not permit any of its Subsidia-
ries to, sell, lease, assign, transfer or otherwise dispose of any
assets, or acquire assets from any Person, except:
(i) dispositions and acquisitions of inventory in the
ordinary course of business;
(ii) dispositions of worn out or obsolete tools or
equipment no longer used or useful in the business of the
Company and its Subsidiaries, provided that all assets
disposed of pursuant to this clause (ii) and clause (v) below
from and after the Closing Date shall not, after giving effect
to any such disposition, have an aggregate fair market value
in excess of $20,000,000;
(iii) expenditures in respect of fixed or capital assets;
(iv) acquisitions of Investments permitted under Section
9.15 hereof;
(v) dispositions of bonds issued in connection with the
Gallman Indebtedness;
(vi) other dispositions of assets which, together with
all assets disposed of pursuant to clause (ii) above from and
after the Closing Date have, after giving effect to any such
disposition, an aggregate fair market value not exceeding
$20,000,000;
(vii) Permitted Dispositions not otherwise permitted
pursuant to clauses (i), (ii), (v) and (vi) of this Section
9.13;
(viii) sales of accounts receivable; provided that the
aggregate outstanding balance of accounts receivable sold by
the Company and its Subsidiaries to third parties will at no
time exceed $75,000,000; and
(ix) Permitted Acquisitions.
For purposes of this Section 9.13, (A) a "Permitted
Disposition" shall mean the disposition of assets (other than a
disposition primarily of accounts receivable) for consideration (at
least 75% of which must be in cash) equal to the fair market value
of the assets being disposed of as determined in good faith by (i)
in the case of a disposition of any asset or group of assets having
an aggregate fair market value of less than or equal to $10,000,000
an executive officer of the Company or (ii) in the case of a
disposition of any asset or group of assets having an aggregate
fair market value in excess of $10,000,000, by the board of
directors of the Company, provided that (x) prior to the entering
into of any such transaction (i) the Lenders shall have received
financial statements, business plans, projections and other
information relating to the assets, business and liabilities of the
Company and its Subsidiaries remaining after consummation of such
transaction, all of which shall be satisfactory in form and
substance to the Majority Lenders and which shall demonstrate to
the Majority Lenders that the cash flow to be generated by such
remaining assets and businesses will be sufficient to permit the
Company and its Subsidiaries to pay all of their respective
obligations as they mature and (ii) the Lenders shall have reviewed
the covenants contained in the Basic Documents and such covenants
shall have been amended as requested by the Majority Lenders and
deemed appropriate by the Majority Lenders for the assets, business
and liabilities of the Company and its Subsidiaries remaining after
consummation of such transaction, (y) the Net Cash Proceeds of such
conveyance, sale, lease, assignment, transfer or other disposition,
as the case may be, are applied in accordance with Section
3.02(b)(2), and (z) no Default or Event of Default has occurred and
is continuing or would result therefrom and (B) a "Permitted
Acquisition" shall mean any acquisition of any asset or Investment
by the Company or any Subsidiary (including any such acquisition by
way of merger); provided that (x) after giving pro forma effect to
such acquisition, the Company would have been in compliance with
Sections 9.08, 9.10, 9.11 and 9.12 hereof during the four fiscal
quarters most recently ended prior to the date of such acquisition
(calculated on the assumption that such acquisition occurred at the
beginning of such four fiscal quarter period) and (y) no Default or
Event of Default has occurred and is continuing or would result
therefrom.
(b) The Company will not, nor will it permit any of its
Subsidiaries to, consolidate or merge with or into any other
Person; provided that (i) the Company or any Subsidiary may merge
with another Person if (x) such Person is organized under the laws
of the United States of America or one of its states, (y) the
Company or any of its Subsidiaries (except that the Company shall
be the remaining corporation upon a merger of a Subsidiary of the
Company with the Company) is the corporation surviving such merger
and (z) immediately after giving effect to such merger, no Default
shall have occurred and be continuing and (ii) any Subsidiary of
the Company may merge with any other Person in connection with a
disposition of such Subsidiary not prohibited by Section 9.13(a).
9.14 Liens. The Company will not, and will not permit
any of its Subsidiaries to, create or suffer to exist any Lien upon
any property or assets, now owned or hereafter acquired, securing
any Indebtedness or other obligation, except: (i) Liens securing
the Gallman Indebtedness in accordance with the definition thereof;
(ii) Liens existing on other assets at the date of acquisition
thereof or which attach to such assets concurrently with or within
90 days after the acquisition thereof, securing Indebtedness
incurred to finance the acquisition thereof in an aggregate amount
at any time outstanding not exceeding $20,000,000; and (iii) other
Liens arising in the ordinary course of the business of the Company
or such Subsidiary which are not incurred in connection with the
borrowing of money or the obtaining of advances or credit and which
do not materially detract from the value of its property or assets
or materially impair the use thereof in the operation of its
business.
9.15 Investments. The Company will not, and will not
permit any of its Subsidiaries to, make or permit to remain
outstanding any advances, loans or other extensions of credit or
capital contributions (other than prepaid expenses in the ordinary
course of business) to (by means of transfers of property or assets
or otherwise), or purchase or own any stocks, bonds, notes,
debentures or other securities of, any Person (all such
transactions being herein called "Investments"), except: (i)
operating deposit accounts; (ii) Liquid Investments; (iii) subject
to Section 9.17 hereof, Investments in accounts and chattel paper
(as defined in the Uniform Commercial Code), and notes receivable
acquired in the ordinary course of business as presently conducted;
(iv) Investments existing on the Closing Date in Wholly-Owned
Subsidiaries and in Systronics, Inc. and Great River Oil & Gas
Corporation, and (v) Investments that constitute Permitted
Acquisitions.
9.16 Restricted Payments. The Company will not, and
will not permit any of its Subsidiaries to, declare or make any
Restricted Payment, except that the Company may (i) purchase shares
of Restricted Stock (as defined in the Incentive Equity Plan) from
employees of the Company or its Subsidiaries upon termination of
such employees' employment, in accordance with the Incentive Equity
Plan in amounts not to exceed $1,000,000 during any fiscal year and
$5,000,000 in the aggregate during the term of this Agreement and
(ii) on and after January 1, 1995, make Restricted Payments in
addition to the Restricted Payments permitted to be made pursuant
to clause (i) above if (a) no Default shall have occurred and be
continuing and (b) after giving effect to any such payment, the
cumulative amount of all payments made in reliance on this clause
(ii) or clause (b)(ii) of Section 9.18 does not exceed 50% of
Cumulative Net Income on the date of such payment.
"Cumulative Net Income" shall mean, on any date, the
cumulative amount of the annual net income, if any (less the
cumulative amount of the annual net loss, if any) of the Company
and its Subsidiaries, determined on a consolidated basis, for each
fiscal year of the Company from (and including) the fiscal year
ending on December 31, 1994 to (and including) the fiscal year of
the Company most recently ended prior to such date.
9.17 Transactions with Affiliates. Except as expressly
permitted by this Agreement, the Company will not, and will not
permit any of its Subsidiaries to, directly or indirectly:
(i) except to the extent not prohibited by Section 9.15, make any
Investment in an Affiliate of the Company; (ii) transfer, sell,
lease, assign or otherwise dispose of any assets to an Affiliate of
the Company; (iii) merge into or consolidate with or purchase or
acquire assets from an Affiliate of the Company; or (iv) enter into
any other transaction directly or indirectly with or for the
benefit of an Affiliate of the Company (including, without
limitation, guarantees and assumptions of obligations of an
Affiliate of the Company); provided that (a) any Affiliate of the
Company who is an individual may serve as a director, officer or
employee of the Company and receive reasonable compensation or
indemnification in connection with his or her services in such
capacity; (b) the Company or a Subsidiary of the Company may enter
into any transaction with an Affiliate of the Company providing for
the leasing of property, the rendering or receipt of services or
the purchase or sale of inventory and other assets in the ordinary
course of business if the monetary or business consideration
arising therefrom would be substantially as advantageous to the
Company or such Subsidiary as the monetary or business
consideration which would be obtained in a comparable arm's length
transaction with a Person not an Affiliate of the Company; and (c)
the Company may pay commissions to Georgia Gulf Export Corporation
on sales of qualified "Export Property" (as defined in Section 927
of the Code) in accordance with Section 925 of the Code and the
rules and regulations thereunder.
9.18 Subordinated Indebtedness. The Company shall not,
and shall not permit any of its Subsidiaries to, purchase, redeem,
retire or otherwise acquire for value, deposit any monies with any
Person with respect to, or make any voluntary payment or prepayment
of the principal of or interest on, or any other amount owing in
respect of, any Subordinated Indebtedness (other than regularly
scheduled payments of interest in respect thereof required pursuant
to the instruments evidencing such Subordinated Indebtedness),
unless (a) no Default shall have occurred and be continuing and (b)
(i) the source of the monies used by the Company in taking any such
action or making any such payment consists solely of any
combination of the Net Cash Proceeds of equity securities of the
Company or of Permitted Refunding Subordinated Indebtedness or, if
the Net Cash Proceeds of Permitted Refunding Subordinated
Indebtedness have been applied to prepay Loans, of Loans, or (ii)
after giving effect to any such purchase, redemption, retirement,
acquisition, deposit or payment, the cumulative amount of all
amounts paid by the Company in reliance on this clause (b)(ii) or
clause (ii) of Section 9.16 does not exceed 50% of Cumulative Net
Income on the date of such purchase, redemption, retirement,
acquisition, deposit or payment; provided that the Company may not
rely on this clause (b)(ii) prior to January 1, 1995. The Company
will not request or consent to any modification, supplement or
waiver of any of the provisions of any instrument or document
evidencing or governing any Subordinated Indebtedness without the
prior written consent of the Administrative Agent (with the
approval of the Majority Lenders).
9.19 Lines of Businesses. Neither the Company nor any
of its Subsidiaries shall engage to any substantial extent in any
line or lines of business activity other than present or related
product lines.
9.20 Environmental Matters. The Company will promptly
give to the Lenders notice in writing of any complaint, order,
citation, notice or other written communication from any Person
with respect to, or if the Company becomes aware after due inquiry
of, (i) the existence or alleged existence of a violation of any
applicable Environmental Law or legal liability resulting from any
air emission, water discharge, noise emission, asbestos, Hazardous
Substance or any other environmental, health or safety matter at,
upon, under or within any property now or previously owned, leased,
operated or used by the Company or any of its Subsidiaries or any
part thereof, or due to the operations or activities of the
Company, any Subsidiary or any other Person on or in connection
with such property or any part thereof (including receipt by the
Company or any Subsidiary of any notice of the happening of any
event involving the Release or cleanup of any Hazardous Substance),
(ii) any Release on such property or any part thereof in a quantity
that is reportable under any applicable Environmental Law, (iii)
the commencement of any cleanup pursuant to or in accordance with
any applicable Environmental Law of any Hazardous Substances on or
about such property or any part thereof and (iv) any pending or
threatened proceeding for the termination, suspension or
non-renewal of any permit required under any applicable
Environmental Law, in each of cases (i), (ii), (iii) and (iv), (x)
which could have a reasonable possibility of resulting in liability
or expenses in excess of $5,000,000 or (y) which individually or in
the aggregate could have a material adverse effect on the condition
(financial or otherwise), assets, nature of assets, liabilities
(including, without limitation, environmental liabilities) or
prospects, taken as a whole, of the Company and its Subsidiaries.
Section 10. Defaults.
10.01 Events of Default. If one or more of the
following events (herein called "Events of Default") shall occur
and be continuing:
(a) default in the payment of (i) any principal of any
Loan when due, (ii) any interest on any Loan within one
Business Day of the due date thereof or (iii) any other amount
payable hereunder within three Business Days after the due
date thereof; or
(b) the Company or any of its Subsidiaries shall default
in the payment when due of any principal of or interest on any
Indebtedness having an outstanding principal amount of at
least $2,000,000 (other than the Loans); or any event or
condition shall occur which results in the acceleration of the
maturity of any such Indebtedness or enables the holder of any
such Indebtedness or any Person acting on such holder's behalf
to accelerate the maturity thereof; or
(c) any representation or warranty made or deemed made by
the Company in any Basic Document, or in any certificate
furnished to any Lender or the Administrative Agent pursuant
to the provisions of any Basic Document, shall prove to have
been false or misleading in any material respect as of the
time made or furnished; or
(d) (i) the Company shall default in the performance of
any of its obligations in Section 9.03 or Sections 9.08
through 9.19 hereof; or (ii) the Company shall default in the
performance of any of its other obligations in any Basic
Document, and such default described in this subclause (ii)
shall continue unremedied for a period of 30 days after notice
thereof to the Company by the Administrative Agent or the
Majority Lenders (through the Administrative Agent); or
(e) the Company or any of its Subsidiaries shall admit
in writing its inability to, or be generally unable to, pay
its debts as such debts become due; or
(f) the Company or any of its Subsidiaries shall
(i) apply for or consent to the appointment of, or the taking
of possession by, a receiver, custodian, trustee or liquidator
of itself or of all or a substantial part of its property,
(ii) make a general assignment for the benefit of its
creditors, (iii) commence a voluntary case under the
Bankruptcy Code, (iv) file a petition seeking to take
advantage of any other law relating to bankruptcy, insolvency,
reorganization, winding-up, or composition or readjustment of
debts, (v) fail to controvert in a timely and appropriate
manner, or acquiesce in writing to, any petition filed against
it in an involuntary case under the Bankruptcy Code, or
(vi) take any corporate or partnership action for the purpose
of effecting any of the foregoing; or
(g) a proceeding or case shall be commenced, without the
application or consent of the Company or any of its
Subsidiaries in any court of competent jurisdiction, seeking
(i) its liquidation, reorganization, dissolution or
winding-up, or the composition or readjustment of its debts,
(ii) the appointment of a trustee, receiver, custodian,
liquidator or the like of such Person or of all or any
substantial part of its assets, or (iii) similar relief in
respect of such Person under any law relating to bankruptcy,
insolvency, reorganization, winding-up, or composition or
adjustment of debts, and such proceeding or case shall
continue undismissed, or an order, judgment or decree
approving or ordering any of the foregoing shall be entered
and continue unstayed and in effect, for a period of 60 days;
or an order for relief against such Person shall be entered in
an involuntary case under the Bankruptcy Code; or
(h) a final judgment or judgments for the payment of
money shall be rendered by a court or courts against the
Company or any of its Subsidiaries in excess of $4,000,000 in
the aggregate, and (i) the same shall not be discharged (or
provision shall not be made for such discharge), or a stay of
execution thereof shall not be procured, within 30 days from
the date of entry thereof, or (ii) the Company or such
Subsidiary shall not, within said period of 30 days, or such
longer period during which execution of the same shall have
been stayed, appeal therefrom and cause the execution thereof
to be stayed during such appeal, or (iii) such judgment or
judgments shall not be discharged (or provisions shall not be
made for such discharge) within 30 days after a decision has
been reached with respect to such appeal and the related stay
has been lifted; or
(i) the Company or any member of the Controlled Group
shall fail to pay when due an amount or amounts aggregating in
excess of $2,000,000 which it shall have become liable to pay
to the PBGC or to a Plan under Title IV of ERISA; or notice of
intent to terminate a Plan or Plans having aggregate Unfunded
Liabilities in excess of $2,000,000 shall be filed under Title
IV of ERISA by the Company or any member of the Controlled
Group, any plan administrator or any combination of the
foregoing; or the PBGC shall institute proceedings under Title
IV of ERISA to terminate or to cause a trustee to be appointed
to administer any such Plan or Plans or a proceeding shall be
instituted by a fiduciary of any such Plan or Plans against
the Company or any member of the Controlled Group to enforce
Section 515 or 4219(c)(5) of ERISA; or a condition shall exist
by reason of which the PBGC would be entitled to obtain a
decree adjudicating that any such Plan or Plans must be
terminated; or
(j) (i) as a result of one or more transactions after
the date of this Agreement, any "person" or "group" of persons
shall have "beneficial ownership" (within the meaning of
Section 13(d) or 14(d) of the Securities Exchange Act of 1934,
as amended, and the applicable rules and regulations
thereunder) of 30% or more of the outstanding common stock of
the Company; (ii) without limiting the generality of the
foregoing, during any period of 12 consecutive months,
commencing after the date of this Agreement, individuals who
at the beginning of such 12-month period were directors of the
Company shall cease for any reason to constitute a majority of
the board of directors of the Company, provided that the
relationships among the respective shareholders of the Company
on the Closing Date shall not be deemed to constitute all or
any combination of them as a "group" for purposes of clause
(j)(i); or (iii) a "Change of Control" (as defined in any Note
Indenture pursuant to which Subordinated Indebtedness is
outstanding) shall be deemed to have occurred.
THEREUPON: the Administrative Agent may (and, if directed by the
Majority Lenders, shall) (a) declare the Working Capital
Commitments terminated (whereupon the Working Capital Commitments
shall be terminated) and/or (b) terminate any Letter of Credit
providing for such termination by sending a notice of termination
as provided therein and/or (c) declare the principal amount then
outstanding of and the accrued interest on the Loans and
Reimbursement Obligations and commitment fees and all other amounts
payable hereunder and under the Notes to be forthwith due and
payable, whereupon such amounts shall be and become immediately due
and payable, without notice (including, without limitation, notice
of intent to accelerate), presentment, demand, protest or other
formalities of any kind, all of which are hereby expressly waived
by the Company; provided that in the case of the occurrence of an
Event of Default with respect to the Company referred to in clause
(f) or (g) of this Section 10.01, the Working Capital Commitments
shall be automatically terminated and the principal amount then
outstanding of and the accrued interest on the Loans and
Reimbursement Obligations and commitment fees and all other amounts
payable hereunder and under the Notes shall be and become
automatically and immediately due and payable, without notice
(including, without limitation, notice of intent to accelerate),
presentment, demand, protest or other formalities of any kind, all
of which are hereby expressly waived by the Company.
10.02 Collateral Account. The Company hereby agrees, in
addition to the provisions of Section 10.01 hereof, that upon the
occurrence and during the continuance of any Event of Default, it
shall, if requested by the Administrative Agent or the Majority
Lenders, pay (and, in the case of any Event of Default with respect
to the Company referred to in clause (f) or (g) of Section 10.01
hereof, forthwith, without any demand or the taking of any other
action by the Lenders, it shall automatically be obligated to pay)
to the Administrative Agent an amount in immediately available
funds equal to the then aggregate amount available for drawings
under all Letters of Credit issued for the account of the Company,
which funds shall be held by the Administrative Agent in a
collateral account established by the Company, and in which the
Company grants the Administrative Agent (on behalf of the Lenders
and the issuers of such Letters of Credit) a continuing security
interest, for such purpose, and be subject to investment (and, to
the extent practicable, be invested) only in Liquid Investments, as
the Administrative Agent may direct, and to withdrawal only to make
or reimburse payments under such Letters of Credit.
Section 11. The Administrative Agent.
11.01 Appointment, Powers and Immunities. Each Lender
hereby irrevocably appoints and authorizes the Administrative Agent
to act as its agent hereunder and under the Letters of Credit and
the other Basic Documents with such powers as are specifically
delegated to the Administrative Agent by the terms hereof and
thereof, together with such other powers as are reasonably
incidental thereto. The Administrative Agent (which term as used
in this Section 11 shall include reference to its affiliates and
its own and its respective affiliates' officers, directors,
employees and agents, and to Chase acting in its individual
capacity hereunder as issuer of Participation Letters of Credit):
(a) shall have no duties or responsibilities except those expressly
set forth in this Agreement, the Letters of Credit and the other
Basic Documents, and shall not by reason of this Agreement, the
Letters of Credit or any other Basic Document be a trustee for any
Lender; (b) shall not be responsible to the Lenders for any
recitals, statements, representations or warranties contained in
this Agreement, the Letters of Credit or any other Basic Document,
or in any certificate or other document referred to or provided for
in, or received by any of them under, this Agreement, the Letters
of Credit or any other Basic Document, or for the value, validity,
effectiveness, genuineness, enforceability or sufficiency of this
Agreement, the Letters of Credit or any other Basic Document or any
other document referred to or provided for herein or therein or for
any failure by any Relevant Party or any other Person to perform
any of its obligations hereunder or thereunder; (c) shall not be
required to initiate or conduct any litigation or collection
proceedings hereunder or under any other Basic Document except to
the extent requested by the Majority Lenders, and (d) shall not be
responsible for any action taken or omitted to be taken by it
hereunder or under the Letters of Credit, any other Basic Document
or any other document or instrument referred to or provided for
herein or therein or in connection herewith or therewith, except
for its own gross negligence or willful misconduct. The
Administrative Agent may employ agents and attorneys-in-fact and
shall not be responsible for the negligence or misconduct of any
such agents or attorneys-in-fact selected by it with reasonable
care. Without in any way limiting any of the foregoing, each
Lender acknowledges that the Administrative Agent shall have no
greater responsibility in the operation of Letters of Credit than
is specified in the Uniform Customs and Practice for Documentary
Credits (1993 Revision), International Chamber of Commerce
Publication No. 500.
11.02 Reliance by Administrative Agent. The
Administrative Agent shall be entitled to rely upon any
certification, notice or other communication (including any thereof
by telephone, telex, telegram or cable) believed by it to be
genuine and correct and to have been signed or sent by or on behalf
of the proper Person or Persons, and upon advice and statements of
legal counsel, independent accountants and other experts selected
by the Administrative Agent. As to any matters not expressly
provided for by this Agreement, the Letters of Credit or any other
Basic Document, the Administrative Agent shall in all cases be
fully protected in acting, or in refraining from acting, hereunder
and thereunder in accordance with instructions signed by the
Majority Lenders, and such instructions of the Majority Lenders,
and any action taken or failure to act pursuant thereto shall be
binding on all of the Lenders.
11.03 Defaults. The Administrative Agent shall not be
deemed to have knowledge of the occurrence of a Default (other than
the non-payment of principal of or interest on Loans or
Reimbursement Obligations) unless the Administrative Agent has
received notice from a Lender or the Company specifying such
Default and stating that such notice is a "Notice of Default". In
the event that the Administrative Agent receives such a notice of
the occurrence of a Default, the Administrative Agent shall give
prompt notice thereof to the Lenders (and shall give each Lender
prompt notice of each such non-payment). The Administrative Agent
shall (subject to Section 11.07 hereof) take such action with
respect to such Default as shall be directed by the Majority
Lenders, provided that, unless and until the Administrative Agent
shall have received such directions, the Administrative Agent may
(but shall not be obligated to) take such action, or refrain from
taking such action, with respect to such Default as it shall deem
advisable in the best interests of the Lenders.
11.04 Rights as a Lender. With respect to its Working
Capital Commitments and the Loans made and Letter of Credit
Liabilities held by it, Chase in its capacity as a Lender hereunder
shall have the same rights and powers hereunder as any other Lender
and may exercise the same as though it were not acting as the
Administrative Agent and the term "Lender" or "Lenders" shall,
unless the context otherwise indicates, include the Administrative
Agent in its individual capacity. The Administrative Agent may
(without having to account therefor to any Lender) accept deposits
from, lend money to and generally engage in any kind of banking,
trust or other business with the Company (and any of its
Affiliates) as if it were not acting as the Administrative Agent
and the Administrative Agent may accept fees and other
consideration from the Company (in addition to the fees heretofore
agreed to between the Company and the Administrative Agent) for
services in connection with this Agreement or otherwise without
having to account for the same to the Lenders.
11.05 Indemnification. The Lenders agree to indemnify
the Administrative Agent (to the extent not reimbursed under
Section 2.02(d), 12.03 or 12.04 hereof, but without limiting the
obligations of the Company under said Sections 2.02(d), 12.03 and
12.04), ratably in accordance with their respective Working Capital
Commitments, for any and all liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or
disbursements of any kind and nature whatsoever which may be
imposed on, incurred by or asserted against the Administrative
Agent in any way relating to or arising out of this Agreement, the
Letters of Credit or any other Basic Document or any other
documents contemplated by or referred to herein or therein or the
transactions contemplated hereby or thereby (including, without
limitation, the costs and expenses which the Company is obligated
to pay under Sections 2.02(d), 12.03 and 12.04 hereof but
excluding, unless a Default has occurred and is continuing, normal
administrative costs and expenses incident to the performance of
its agency duties hereunder) or the enforcement of any of the terms
hereof or thereof or of any such other documents, provided that no
Lender shall be liable for any of the foregoing to the extent they
arise from the gross negligence or willful misconduct of the party
to be indemnified.
11.06 Non-Reliance on Administrative Agent and Other
Lenders. Each Lender agrees that it has, independently and without
reliance on the Administrative Agent or any other Lender, and based
on such documents and information as it has deemed appropriate,
made its own credit analysis of the Company and decision to enter
into this Agreement and that it will, independently and without
reliance upon the Administrative Agent or any other Lender, and
based on such documents and information as it shall deem
appropriate at the time, continue to make its own analysis and
decisions in taking or not taking action under this Agreement, the
Letters of Credit or any of the other Basic Documents. The
Administrative Agent shall not be required to keep itself informed
as to the performance or observance by the Company of this
Agreement or any of the other Basic Documents or any other document
referred to or provided for herein or therein or to inspect the
properties or books of the Company. Except for notices, reports
and other documents and information expressly required to be
furnished to the Lenders by the Administrative Agent hereunder,
under the Letters of Credit or the other Basic Documents, the
Administrative Agent shall not have any duty or responsibility to
provide any Lender with any credit or other information concerning
the affairs, financial condition or business of the Company (or any
of its affiliates) which may come into the possession of the
Administrative Agent.
11.07 Failure to Act. Except for action expressly
required of the Administrative Agent hereunder, under the Letters
of Credit and under the other Basic Documents, the Administrative
Agent shall in all cases be fully justified in failing or refusing
to act hereunder and thereunder unless it shall receive further
assurances to its satisfaction by the Lenders of their
indemnification obligations under Section 11.05 hereof against any
and all liability and expense which may be incurred by it by reason
of taking or continuing to take any such action.
11.08 Resignation or Removal of Administrative Agent.
Subject to the appointment and acceptance of a successor
Administrative Agent as provided below, the Administrative Agent
may resign at any time by giving notice thereof to the Lenders and
the Company and the Administrative Agent may be removed at any time
with or without cause by the Majority Lenders. Upon any such
resignation or removal, the Majority Lenders shall have the right
to appoint a successor Administrative Agent reasonably acceptable
to the Company. If no successor Administrative Agent shall have
been so appointed by the Majority Lenders and shall have accepted
such appointment within 30 days after the retiring Administrative
Agent's giving of notice of resignation or the Majority Lenders'
removal of the retiring Administrative Agent (the "Notice Date"),
then the retiring Administrative Agent may, on behalf of the
Lenders, appoint a successor Administrative Agent reasonably
acceptable to the Company. Any successor Administrative Agent
shall be (i) a Lender or (ii) if no Lender has accepted such
appointment within 40 days after the Notice Date, a bank which has
an office in New York, New York with a combined capital and surplus
of at least $250,000,000. Upon the acceptance of any appointment
as Administrative Agent hereunder by a successor Administrative
Agent, such successor Administrative Agent shall thereupon succeed
to and become vested with all the rights, powers, privileges and
duties of the retiring Administrative Agent, and the retiring
Administrative Agent shall be discharged from its duties and
obligations hereunder. After any retiring Administrative Agent's
resignation or removal hereunder as Administrative Agent, the
provisions of this Section 11 shall continue in effect for its
benefit in respect of any actions taken or omitted to be taken by
it while it was acting as the Administrative Agent.
11.09 Consents under Basic Documents. Without the prior
written consent of the Majority Lenders, the Administrative Agent
will not consent to any modification, supplement or waiver under
any of the Basic Documents.
Section 12. Miscellaneous.
12.01 Waiver. No failure on the part of the
Administrative Agent or any Lender to exercise and no delay in
exercising, and no course of dealing with respect to, any right,
power or privilege under any Basic Document shall operate as a
waiver thereof, nor shall any single or partial exercise of any
right, power or privilege thereunder preclude any other or further
exercise thereof or the exercise of any other right, power or
privilege. The remedies provided in the Basic Documents are
cumulative and not exclusive of any remedies provided by law.
12.02 Notices. All notices and other communications
provided for herein (including, without limitation, any
modifications of, or waivers or consents under, this Agreement)
shall be given or made by telex, telegraph, telecopy, cable or
other writing and telexed, telecopied, telegraphed, cabled, mailed
or delivered to the intended recipient at the "Address for Notices"
specified below its name on the signature pages hereof; or, as to
any party, at such other address as shall be designated by such
party in a notice to the Company and the Administrative Agent given
in accordance with this Section 12.02. Except as otherwise
provided in this Agreement, all such communications shall be deemed
to have been duly given when transmitted by telex or telecopier,
delivered to the telegraph or cable office or personally delivered
or, in the case of a mailed notice, upon receipt, in each case
given or addressed as aforesaid.
12.03 Expenses, Etc. The Company agrees to pay or
reimburse each of the Lenders and the Administrative Agent for
paying: (a) the reasonable fees and expenses of Davis Polk &
Wardwell, special counsel to the Administrative Agent in connection
with (i) the preparation, execution and delivery of this Agreement
(including the Exhibits hereto) and the making of the Loans and
issuance of Letters of Credit hereunder and (ii) any modification,
supplement or waiver of any of the terms of this Agreement, the
Letters of Credit or any other Basic Document; (b) if an Event of
Default occurs, all reasonable costs and expenses of the Lenders
and the Administrative Agent (including reasonable counsels' fees)
incurred as a result of such Event of Default and collection,
enforcement, bankruptcy, insolvency and other proceedings resulting
therefrom; (c) all transfer, stamp, documentary or other similar
taxes, assessments or charges levied by any governmental or revenue
authority in respect of this Agreement, any Letter of Credit or any
other Basic Document or any other document referred to herein or
therein; and (d) all costs, expenses, taxes, assessments and other
charges incurred in connection with any filing, registration,
recording or perfection of any security interest contemplated by
this Agreement or any document referred to herein or therein.
12.04 Indemnification. The Company shall indemnify the
Administrative Agent, the Lenders and each affiliate thereof and
their respective directors, officers, employees and agents from,
and hold each of them harmless against, any and all losses,
liabilities, claims or damages to which any of them may become
subject, insofar as such losses, liabilities, claims or damages
arise out of or result from any actual or proposed use by the
Company of the proceeds of any extension of credit (whether a Loan
or a Letter of Credit) by any Lender hereunder or breach by the
Company of this Agreement or any other Basic Document or from any
investigation, litigation or other proceeding (including any
threatened investigation or proceeding) relating to the foregoing,
and the Company shall reimburse the Administrative Agent and each
Lender, and each affiliate thereof and their respective directors,
officers, employees and agents, upon demand for any expenses
(including legal fees) incurred in connection with any such
investigation or proceeding; but excluding any such losses,
liabilities, claims, damages or expenses incurred by reason of the
gross negligence or willful misconduct of the Person to be
indemnified.
12.05 Amendments, Etc. No amendment or waiver of any
provision of this Agreement or the Notes, nor any consent to any
departure by the Company therefrom, shall in any event be effective
unless the same shall be agreed or consented to by the Majority
Lenders and the Company, and each such waiver or consent shall be
effective only in the specific instance and for the specific
purpose for which given; provided, that (a) no amendment, waiver or
consent shall, unless in writing and signed by all the Lenders, do
any of the following: (i) increase any Working Capital Commitment
of any of the Lenders or subject the Lenders to any additional
obligations; (ii) reduce the principal of, or interest on, any
Loan, Reimbursement Obligation or fees hereunder; (iii) postpone
any date fixed for any payment of principal of, or interest on, any
Loan, Reimbursement Obligation or fee hereunder pursuant to
Sections 2.02, 2.04, 4.01(a), 4.01(b) or 4.02 hereof; (iv) change
the percentage of any of the Working Capital Commitments or of the
aggregate unpaid principal amount of any of the Loans and Letter of
Credit Liabilities, or the number of Lenders, which shall be
required for the Lenders or any of them to take any action under
this Agreement; or (v) change any provision contained in Sections
2.08, 6, 12.03 or 12.04 hereof or this Section 12.05 or Section
12.08 hereof. Notwithstanding anything in this Section 12.05 to
the contrary, no amendment, waiver or consent shall be made with
respect to Section 11 without the consent of the Administrative
Agent.
12.06 Successors and Assigns. 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 its rights or obligations hereunder or under the Notes
without the prior written consent of all of the Lenders. Each
Lender may assign any Loan or Loans or Letter of Credit Liabilities
or all or any part of its Loans or Working Capital Commitments (i)
to any affiliate thereof, (ii) to any other Lender, or (iii) with
the consent of the Company and, in the case of any assignment of
Working Capital Commitments, Working Capital Loans or Letter of
Credit Liabilities, the Administrative Agent, which consents shall
not be unreasonably withheld, to any other bank or financial
institution (including a closed-end or other fund) (provided that
(a) any assignment pursuant to clause (i) or (ii) above shall not
be less than $1,000,000 and (b) any assignment or, if substantially
simultaneous, the aggregate amount of any assignments by one or
more Lenders pursuant to clause (iii) above to any one bank or
financial institution shall not be less than $15,000,000, unless,
in each case, such assignment constitutes an assignment of all of
such Lender's Working Capital Commitments, Working Capital Loans
and Letter of Credit Liabilities). Upon execution by the assignor
and the assignee of an instrument pursuant to which the assignee
assumes such rights and obligations, payment by such assignee to
such assignor of an amount equal to the purchase price agreed
between such assignor and such assignee and delivery to the
Administrative Agent and the Company of an executed copy of such
instrument together with payment by such assignee to the
Administrative Agent of a processing fee of $2,500, such assignee
shall have, to the extent of such assignment (unless otherwise
provided therein), the same rights and benefits as it would have if
it were a Lender hereunder and the assignor shall be, to the extent
of such assignment (unless otherwise provided therein) released
from its obligations under this Agreement. Each Lender may
(without the consent of any other party to this Agreement) sell
participations in all or any part of any Loan or Loans made or
Letter of Credit Liabilities held by it to another bank or other
entity, in which event the participant shall not have any rights
under this Agreement (except as provided in the next succeeding
sentence hereof), or in the case of a Loan, such Lender's Note (the
participant's rights against such Lender in respect of such
participation to be those set forth in the agreement executed by
such Lender in favor of the participant relating thereto, which
agreement shall not give the participant the right to consent to
any modification, amendment or waiver other than one described in
clause (i), (ii) or (iii) of Section 12.05 hereof). The Company
agrees that each participant shall be entitled to the benefits of
Sections 5.07 and 6 with respect to its participation; provided
that no participant shall be entitled to receive any greater amount
pursuant to such Sections than the transferor Lender would have
been entitled to receive in respect of the amount of the
participation transferred by such transferor Lender to such
participant had no such transfer occurred. Each Lender may furnish
any information concerning the Company and its Subsidiaries in the
possession of such Lender from time to time to assignees and
participants (including prospective assignees and participants)
which have agreed in writing to be bound by the provisions of
Section 12.07 hereof. The Administrative Agent and the Company
may, for all purposes of this Agreement, treat any Lender as the
holder of any Note drawn to its order (and owner of the Loans
evidenced thereby) until written notice of assignment,
participation or other transfer shall have been received by them
from such Lender. Any Lender may at any time assign all or any
portion of its rights under this Agreement and its Notes to a
Federal Reserve Bank without the consent of the Company or the
Administrative Agent. No such assignment shall release the
transferor Lender from its obligations hereunder.
12.07 Confidentiality. Each Lender agrees to exercise
all reasonable efforts to keep any information delivered or made
available by the Company to it which is clearly indicated to be
confidential information, confidential from anyone other than
persons employed or retained by such Lender who are or are expected
to become engaged in evaluating, approving, structuring or
administering the Loans; provided that nothing herein shall prevent
any Lender from disclosing such information (i) to any other
Lender, (ii) to its officers, directors, employees, agents,
attorneys and accountants who have a need to know such information
in accordance with customary banking practices and who receive such
information having been made aware of the restrictions set forth in
this Section, (iii) upon the order of any court or administrative
agency, (iv) upon the request or demand of any regulatory agency or
authority having jurisdiction over such Lender, (v) which has been
publicly disclosed, (vi) to the extent reasonably required in
connection with any litigation to which the Administrative Agent,
any Lender or their respective affiliates may be a party, (vii) to
the extent reasonably required in connection with the exercise of
any remedy hereunder, (viii) to such Lender's legal counsel and
independent auditors, and (ix) to any actual or proposed
participant or assignee of all or part of its rights hereunder
which has agreed in writing to be bound by the provisions of this
Section 12.07.
12.08 Survival. The obligations of the Company under
Sections 2.02(d), 6.01, 6.05, 6.06, 6.07, 12.03 and 12.04 hereof
and the obligations of the Lenders under Section 11.05 shall
survive the repayment of the Loans and Reimbursement Obligations
and the termination of the Working Capital Commitments and the
Letters of Credit.
12.09 Captions. Captions and section headings appearing
herein are included solely for convenience of reference and are not
intended to affect the interpretation of any provision of this
Agreement.
12.10 Counterparts; Integration. This Agreement may be
executed in any number of counterparts, all of which taken together
shall constitute one and the same instrument, and any of the
parties hereto may execute this Agreement by signing any such
counterpart. This Agreement constitutes the entire agreement and
understanding among the parties hereto and supersedes any and all
prior agreements and understandings, oral and written, relating to
the subject matter hereof (except to the extent specific reference
is made to any such agreement in Section 2.04 hereof).
12.11 GOVERNING LAW; SUBMISSION TO JURISDICTION; WAIVER
OF JURY TRIAL. THIS AGREEMENT AND THE NOTES SHALL BE GOVERNED BY
AND CONSTRUED IN ACCORDANCE WITH THE LAW OF THE STATE OF NEW YORK.
THE COMPANY HEREBY SUBMITS TO THE NONEXCLUSIVE JURISDICTION OF THE
UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK
AND OF ANY NEW YORK STATE COURT SITTING IN NEW YORK CITY FOR
PURPOSES OF ALL LEGAL PROCEEDINGS ARISING OUT OF OR RELATING TO
THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY. THE
COMPANY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW,
ANY OBJECTION WHICH IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF
THE VENUE OF ANY SUCH PROCEEDING BROUGHT IN SUCH A COURT AND ANY
CLAIM THAT ANY SUCH PROCEEDING BROUGHT IN SUCH A COURT HAS BEEN
BROUGHT IN AN INCONVENIENT FORUM. EACH OF THE COMPANY, THE
ADMINISTRATIVE AGENT AND THE LENDERS HEREBY IRREVOCABLY WAIVES ANY
AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT
OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED
HEREBY.
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed and delivered as of the day and year
first above written.
COMPANY GEORGIA GULF CORPORATION
By /s/RICHARD B. MARCHESE
Name: Richard B. Marchese
Title: Vice President - Finance
Chief Financial Officer
Address for Notices:
Georgia Gulf Corporation
400 Perimeter Center Terrace
Suite 595
Atlanta, Georgia 30346
Attention: Chief Financial Officer
Copy to:
General Counsel
Georgia Gulf Corporation
400 Perimeter Center Terrace
Suite 595
Atlanta, Georgia 30346
Telex Number: 8107510027
Telecopy Number: (404) 390-9673
<PAGE>
LENDERS
Working Capital Commitment:
$ 28,000,000 THE CHASE MANHATTAN BANK
(NATIONAL ASSOCIATION)
By /s/PAUL BECKWITH
Name: Paul Beckwith
Title: Group Executive
Address for Notices:
The Chase Manhattan Bank
(National Association)
4 Chase Metrotech Center
13th Floor
Brooklyn, New York 11245
Attention: NY Agency
Lenord Selanikio
Tel. Number: (718) 242-7974
Telex Number: 6720516 CMB NYA
Telecopy Number: (718) 242-6900
Lending Office for
Base Rate Loans:
The Chase Manhattan Bank
(National Association)
4 Chase Metrotech Center
13th Floor
Brooklyn, New York 11245
Attention: NY Agency
Lenord Selanikio
Lending Office for
Eurodollar Loans:
Cayman Islands, B.W.I. Branch
c/o The Chase Manhattan Bank
(National Association)
4 Chase Metrotech Center
13th Floor
Brooklyn, New York 11245
Attention: NY Agency
Lenord Selanikio
<PAGE>
Working Capital Commitment:
$ 17,000,000 THE BANK OF TOKYO TRUST COMPANY
By /s/WILLIAM J. DARBY
Name: William J. Darby
Title: Assistant Vice President
Address for Notices:
The Bank of Tokyo Trust Company
1251 Avenue of the Americas
New York, NY 10116-3138
Attention: William J. Darby
Tel. No.: (212) 782-4318
Telex Number:
Telecopy Number: (212) 782-4318
Lending Office for
Base Rate Loans:
The Bank of Tokyo Trust Company
1251 Avenue of the Americas
New York, NY 10116-3138
Attention: William J. Darby
Lending Office for
Eurodollar Loans:
The Bank of Tokyo Trust Company
1251 Avenue of the Americas
New York, NY 10116-3138
Attention: William J. Darby
<PAGE>
Working Capital Commitment:
$ 22,000,000 CITICORP USA, INC.
By /s/BARBARA A. COHEN
Name: Barbara A. Cohen
Title: Vice President
Address for Notices:
Citicorp USA, Inc.
c/o Citicorp
North America
400 Perimeter Center Terrace
Suite 600
Atlanta, Georgia 30346
Attention: Kirk Lakeman
Tel. No.: (404) 668-8120
Telex Number:
Telecopy Number: (404) 668-8137
Lending Office for
Base Rate Loans:
Citicorp USA, Inc.
399 Park Avenue
New York, New York 10043
Attention: Barbara A. Cohen
Lending Office for
Eurodollar Loans:
Citicorp USA, Inc.
399 Park Avenue
New York, New York 10043
Attention: Barbara A. Cohen
<PAGE>
Working Capital Commitment:
$ 22,000,000 THE INDUSTRIAL BANK OF JAPAN,
LIMITED, NEW YORK BRANCH
By /s/JUNRI ODA
Name: Junri Oda
Title: Senior Vice President and Senion Manager
Address for Notices:
The Industrial Bank of Japan,
Limited, New York Branch
245 Park Avenue
New York, NY 10167-0037
Attention: Mr. Miki Katsumata/
Mr. Peter Kelly
Tel. No.: (212) 309-6452
Telex Number: 420802 (420802 KIGIUI)
Telecopy Number: (212) 692-2870
Lending Office for
Base Rate Loans:
The Industrial Bank of Japan,
Limited, New York Branch
245 Park Avenue
New York, NY 10167-0037
Attention: Mr. Masaaki Tahara
Lending Office for
Eurodollar Loans:
The Industrial Bank of Japan,
Limited, New York Branch
245 Park Avenue
New York, NY 10167-0037
Attention: Mr. Masaaki Tahara
<PAGE>
Working Capital Commitment:
$ 17,000,000 LTCB TRUST COMPANY
By /s/PHILIP A. MARSDEN
Name: Philip A. Marsden
Title: Deputy General Manager
Address for Notices:
LTCB Trust Company
165 Broadway
New York, NY 10006
Attention: Shunko Uchida
Tel. No.: (212) 335-4748
Telex Number: 425722 LTCBUI
Telecopy Number: (212) 608-2371
Lending Office for
Base Rate Loans:
LTCB Trust Company
165 Broadway
New York, NY 10006
Attention: Winston Brown
Lending Office for
Eurodollar Loans:
LTCB Trust Company
165 Broadway
New York, NY 10006
Attention: Winston Brown
<PAGE>
Working Capital Commitment:
$ 17,000,000 THE SAKURA BANK, LTD.
By /s/MINORU INABA
Name: Minoru Inaba
Title: Vice President/Senior Manager
Address for Notices:
245 Peachtree Center Avenue, N.E.
Suite 2703
Atlanta, Georgia 30303
Attention: Charles Zimmerman
Tel. No.: (404) 521-3111
Telex Number: WU 125435
Telecopy Number: (212) 521-1133
Lending Office for
Base Rate Loans:
245 Peachtree Center Avenue, N.E.
Suite 2703
Atlanta, Georgia 30303
Attention: Charles Zimmerman
Tel. No.: (404) 521-3111
Lending Office for
Eurodollar Loans:
245 Peachtree Center Avenue, N.E.
Suite 2703
Atlanta, Georgia 30303
Attention: Charles Zimmerman
Tel. No.: (404) 521-3111
<PAGE>
Working Capital Commitment:
$ 22,000,000 BANK OF AMERICA NATIONAL TRUST
AND SAVINGS ASSOCIATION
By /s/GLENN F. EDWARDS
Name: Glenn F. Edwards
Title: Vice President
Address for Notices:
The Bank of America NT & SA
1230 Peachtree Street
Suite 3600
Atlanta, Georgia 30309
Attention: Bill Tucker
Tel. No.: (404) 249-6927
Telex Number:
Telecopy Number: (404) 249-6938
Lending Office for
Base Rate Loans:
The Bank of America NT & SA
1850 Gateway Blvd.
Concord, California 94520
Attention: Account Administrator
Tel. No.: (510) 675-7335
Telecopy: (510) 675-7531
Lending Office for
Eurodollar Loans:
The Bank of America NT & SA
1850 Gateway Blvd.
Concord, California 94520
Attention: Account Administrator
Tel. No.: (510) 675-7335
Telecopy: (510) 675-7531
<PAGE>
Working Capital Commitment:
$ 22,000,000 FUJI BANK, LTD.
By /s/AKIHIKO INOUR
Name: Akihiko Inour
Title: Vice President & General Manager
Address for Notices:
245 Peachtree Center Avenue, N.E.
Suite 2100
Atlanta, Georgia 30303-1208
Attention: Scott Keller
Tel. No.: (404) 653-2113
Telex Number: 9102507122
Telecopy Number: (404) 653-2119
Lending Office for
Base Rate Loans:
245 Peachtree Center Avenue, N.E.
Suite 2100
Atlanta, Georgia 30303-1208
Attention: Scott Keller
Tel. No.: (404) 653-2113
Lending Office for
Eurodollar Loans:
245 Peachtree Center Avenue, N.E.
Suite 2100
Atlanta, Georgia 30303-1208
Attention: Scott Keller
Tel. No.: (404) 653-2113
<PAGE>
Working Capital Commitment:
$ 22,000,000 NATIONSBANK OF GEORGIA, N.A.
By /s/C. WES BURTON, JR.
Name: C. Wes Burton, Jr.
Title: Assistant Vice President
Address for Notices:
600 Peachtree Street, N.E.
21st Floor
Atlanta, Georgia 30308-2213
Attention: C. Wes Burton
Tel. No.: (404) 607-5531
Telex Number:
Telecopy Number: (404) 607-6467
Lending Office for
Base Rate Loans:
600 Peachtree Street, N.E.
21st Floor
Atlanta, Georgia 30308-2213
Attention: Charlotte Whitaker
Tel. No.: (404) 607-5526
Lending Office for
Eurodollar Loans:
600 Peachtree Street, N.E.
21st Floor
Atlanta, Georgia 30308-2213
Attention: Charlotte Whitaker
Tel. No.: (404) 607-5526
<PAGE>
Working Capital Commitment:
$ 22,000,000 WACHOVIA BANK OF GEORGIA, N.A.
By /s/MICHAEL G. MOUNTCASTLE
Name: Michael G. Mountcastle
Title: Assistant Vice President
Address for Notices:
191 Peachtree Street, N.E.
Mail Code 3940
Atlanta, Georgia 30303-1757
Attention: Mike G. Mountcastle
Tel. No.: (404) 332-5317
Telex Number:
Telecopy Number: (404) 332-5016
Lending Office for
Base Rate Loans:
191 Peachtree Street, N.E.
Mail Code 3940
Atlanta, Georgia 30303-1757
Attention: Mike G. Mountcastle
Lending Office for
Eurodollar Loans:
191 Peachtree Street, N.E.
Mail Code 3940
Atlanta, Georgia 30303-1757
Attention: Mike G. Mountcastle
<PAGE>
Working Capital Commitment:
$ 17,000,000 WESTDEUTSCHE LANDESBANK,
NEW YORK AND CAYMAN ISLAND BRANCHES
By /s/CYNTHIA H. NIESEN
Name: Cynthia H. Niesen
Title: Vice President
By /s/ROBERT DUNBAR JR.
Name: Robert Dunbar, Jr.
Title: Vice President
Address for Notices:
Westdeutsche Landesbank Girozentrale,
New York Branch
1211 Avenue of the Americas
New York, NY 10036
Attention: Nandini R. Ray
Copy to: Cynthia Niesen
Tel. No.: (212) 852-6294
Telex Number:
Telecopy Number: (212) 302-7946
Lending Office for
Base Rate Loans:
Westdeutsche Landesbank Girozentrale,
New York Branch
1211 Avenue of the Americas
New York, NY 10036
Attention: Nandini R. Ray
Lending Office for
Eurodollar Loans:
Westdeutsche Landesbank Girozentrale,
Cayman Islands Branch
c/o New York Branch
1211 Avenue of the Americas
New York, NY 10036
Attention: Nandini R. Ray
<PAGE>
Working Capital Commitment:
$ 22,000,000 THE NIPPON CREDIT BANK, LTD.
By /s/TAKASHI YOSHIMATSU
Name: Takashi Yoshimatsu
Title: Deputy General Manager
Address for Notices:
The Nippon Credit Bank, Ltd.
245 Park Avenue, 30th Floor
New York, NY 10167
Attention: Elizabeth S. Tarbell
Tel. No.: (212) 984-1235
Telex Number: 175588 NCBN UT
Telecopy Number: (212) 490-3895
Lending Office for
Base Rate Loans:
The Nippon Credit Bank, Ltd.
245 Park Avenue, 30th Floor
New York, NY 10167
Attention: Elizabeth S. Tarbell
Lending Office for
Eurodollar Loans:
The Nippon Credit Bank, Ltd.
245 Park Avenue, 30th Floor
New York, NY 10167
Attention: Elizabeth S. Tarbell
<PAGE>
ADMINISTRATIVE AGENT THE CHASE MANHATTAN BANK
(National Association),
as Administrative Agent
By /s/PAUL BECKWITH
Name: Paul Beckwith
Title: Group Executive
Address for Notices:
The Chase Manhattan Bank
(National Association)
1 Chase Manhattan Plaza
New York, New York 10081
Attention: Primary Industries
Michael McGovern
Telex Number: 125563
Telecopy Number: (212) 552-7773
Copy to:
The Chase Manhattan Bank
(National Association)
4 Metrotech Center, 13th Floor
Brooklyn, New York 11245
Attention: New York Agency
Lenord Selanikio
Telex Number: 6720516 CMB NYA UW
Telecopy Number: (718) 242-6900
<PAGE>
SCHEDULE I
Subsidiaries
Great River Oil & Gas Corporation
GG Terminal Management Corporation
Georgia Gulf Export Corporation
<PAGE>
<TABLE>
<CAPTION> SCHEDULE II
EXISTING LETTERS OF CREDIT
Beneficiary Letter of Issue Date Letter of Credit Letter of
Credit Number Expiry Date Credit Amount
<S> <C> <C> <C> <C>
SECRETARY, LOUISIANA
DEPARTMENT OF
ENVIRONMENTAL
QUALITY P0633549 March 19, 1991 *April 1, 1995 $2,419,935.00
SECRETARY, LOUISIANA
DEPARTMENT OF
ENVIRONMENTAL
QUALITY P0636550 March 19, 1991 *April 1, 1995 $1,694,343.00
REGIONAL ADMINISTRATOR
REGION VI, U.S.
ENVIRONMENTAL
PROTECTION AGENCY P0636687 August 19, 1991 *August 20, 1994 $57,501.00
HERTZ TECHNOLOGY, INC. PG752218 January 13, 1993 December 31, 1994 $7,000.00
SECRETARY, LOUISIANA
DEPARTMENT OF
ENVIONMENTAL
QUALITY PG752445 March 22, 1993 *April 1, 1995 $2,000,000.00
SECRETARY, LOUISIANA
DEPARTMENT OF
ENVIRONMENTAL
QUALITY PG752445 March 22, 1993 *April 1, 1995 $2,000,000.00
EXECUTIVE DIRECTOR,
TEXAS WATER
COMMISSION PG752446 March 22, 1993 *April 1, 1995 $2,000,000.00
* Expiration date will be automatically extended for a period of
1 year on each successive expiration date
unless letter of credit is terminated prior to extension.
</TABLE>
<PAGE>
EXHIBIT A
[Form of Working Capital Loan Note]
PROMISSORY NOTE
$_______________ ____________, 199_
New York, New York
FOR VALUE RECEIVED, Georgia Gulf Corporation, a Delaware
corporation (the "Company"), hereby promises to pay to ___________________
(the "Lender"), or order, at the principal office of The Chase Manhattan
Bank (National Association) at 1 Chase Manhattan Plaza, New York, New York
10081, the principal sum of _______________ Dollars (or such lesser amount
as shall equal the aggregate unpaid principal amount of the Working Capital
Loans made by the Lender to the Company under the Credit Agreement referred
to below), in lawful money of the United States of America and in
immediately available funds, on the dates and in the principal amounts
provided in the Credit Agreement, and to pay interest on the unpaid
principal amount of each such Working Capital Loan, at such office, in like
money and funds, for the period commencing on the date of such Working
Capital Loan until such Working Capital Loan shall be paid in full, at the
rates per annum and on the dates provided in the Credit Agreement. This
Note is one of the Working Capital Loan Notes referred to in the Credit
Agreement.
The Lender is hereby authorized by the Company to endorse on the
schedule (or a continuation thereof) attached to this Note, the date,
amount, Type of and Interest Period (if any) for each Working Capital Loan
made by the Lender to the Company under the Credit Agreement, and the date
and amount of each payment or prepayment of principal of such Working
Capital Loan received by the Lender, provided that any failure by the
Lender to make any such endorsement shall not affect the obligations of the
Company under the Credit Agreement or under this Note in respect of such
Working Capital Loans.
This Note is one of the Notes referred to in the Credit Agreement
(as modified and supplemented and in effect from time to time, the "Credit
Agreement") dated as of April __, 1994 among the Company, the lenders named
therein (including the Lender), and The Chase Manhattan Bank (National
Association), as Administrative Agent, and evidences Working Capital Loans
made by the Lender thereunder. Capitalized terms used in this Note have
the respective meanings assigned to them in the Credit Agreement.
The Credit Agreement provides for the acceleration of the
maturity of this Note upon the occurrence of certain events and for
prepayments of Working Capital Loans upon the terms and conditions
specified therein.
This Note shall be governed by and construed in accordance with the
laws of the State of New York.
GEORGIA GULF CORPORATION
By______________________
Title:
<PAGE>
SCHEDULE
This Note evidences Working Capital Loans made under the within-described
Credit Agreement to the Company, on the dates, in the principal amounts,
of the types and maturing on the dates set forth below, subject to the
payments and prepayments of principal set forth below:
Type
Principal of
Amount of Working Date of Amount Balance
Date Working Capital Interest Payment or Paid or Out-
Made Capital Loan Loan Period Prepayment Prepaid standing
<PAGE>
EXHIBIT B
[Form of Money Market Loan Note]
PROMISSORY NOTE
____________, 199_
New York, New York
FOR VALUE RECEIVED, GEORGIA GULF CORPORATION, a
Delaware corporation (the "Company"), hereby promises to pay
to ______________________ (the "Lender"), or order, at the
principal office of The Chase Manhattan Bank (National
Association) at
1 Chase Manhattan Plaza, New York, New York 10081, the
aggregate unpaid principal amount of the Money Market Loans
made by the Lender to the Company under the Credit Agreement,
in lawful money of the United States of America and in
immediately available funds, on the dates and in the principal
amounts provided in the Credit Agreement, and to pay interest
on the unpaid principal amount of each such Money Market Loan,
at such office, in like money and funds, for the period
commencing on the date of such Money Market Loan until such
Money Market Loan shall be paid in full, at the rates per
annum and on the dates provided in the Credit Agreement. This
Note is one of the Money Market Loan Notes referred to in the
Credit Agreement.
The Lender is hereby authorized by the Company to
endorse on the schedule (or a continuation thereof) attached
to this Note, the date, amount, Type of, interest rate on and
Interest Period for the Money Market Loans (if any) made by
the Lender to the Company under the Credit Agreement, and the
date and amount of each payment or prepayment of principal of
each such Money Market Loan received by the Lender, provided
that any failure by the Lender to make any such endorsement
shall not affect the obligations of the Company under the
Credit Agreement or under this Note in respect of any such
Money Market Loan.
This Note is one of the Notes referred to in the
Credit Agreement (as modified and supplemented and in effect
from time to time, the "Credit Agreement") dated as of April
__, 1994 among the Company, the lenders named therein
(including the Lender) and The Chase Manhattan Bank (National
Association), as Administrative Agent, and evidences Money
Market Loans made by the Lender thereunder. Capitalized terms
used in this Note have the respective meanings assigned to
them in the Credit Agreement.
The Credit Agreement provides for the acceleration
of the maturity of this Note upon the occurrence of certain
events and for prepayments of Loans upon the terms and
conditions specified therein.
This Note shall be governed by, and construed in
accordance with, the law of the State of New York.
GEORGIA GULF CORPORATION
By_________________________
Title:
<PAGE>
SCHEDULE
This Note evidences Money Market Loans made under the within-
described Credit Agreement to the Company, on the dates, in
the principal amounts, of the types, bearing interest at the
rates and maturing on the dates set forth below, subject to
the payments and prepayments of principal set forth below:
Principal
Date Amount Type Amount Unpaid
of of of Interest Interest Paid or Principal Notation
Loan Loan Loan Rate Period Prepaid Amount Made By
<PAGE>
EXHIBIT C
[Form of Swing Loan Note]
PROMISSORY NOTE
____________, 199_
New York, New York
FOR VALUE RECEIVED, Georgia Gulf Corporation, a
Delaware corporation (the "Company"), hereby promises to pay
to THE CHASE MANHATTAN BANK (NATIONAL ASSOCIATION) (the
"Lender"), or order, at its principal office at 1 Chase
Manhattan Plaza, New York, New York 10081, the principal sum
of DOLLARS (or such lesser
amount as shall equal the aggregate unpaid principal amount of
the Swing Loans made by the Lender to the Company under the
Credit Agreement referred to below), in lawful money of the
United States of America and in immediately available funds,
on the dates and in the principal amounts provided in the
Credit Agreement, and in any event upon the incurrence of an
Event of Default pursuant to the Credit Agreement immediately
upon demand by the Lender, and to pay interest on the unpaid
principal amount of each such Swing Loan until such Swing Loan
shall be paid in full, at the rates per annum and on the dates
provided in the Credit Agreement (or, in any event, on the
date on which payment of the principal of such Swing Loan is
due hereunder).
The Lender is hereby authorized by the Company to
endorse on the schedule (or a continuation thereof) attached
to this Note, the amount, date and maturity date of each Swing
Loan made by the Lender to the Company under the Credit
Agreement, and the date and amount of each payment or
prepayment of principal of each such Swing Loan received by
the Lender, provided that any failure by the Lender to make
any such endorsement shall not affect the obligations of the
Company under the Credit Agreement or under this Note in
respect of such Swing Loans.
The Lender may charge the Company's deposit account
maintained at the Lender for each payment of principal and
interest due hereunder on the due date thereof. If the Lender
shall make a new advance on a day on which the Company is to
repay an advance hereunder, the Lender shall apply the
proceeds of the new advance to make such repayment and only an
amount equal to the difference (if any) between the amount
being advanced and the amount being repaid shall be made
available to the Company in accordance with the terms of the
Credit Agreement.
This Note is one of the Notes referred to in the
Credit Agreement (as modified and supplemented and in effect
from time to time, the "Credit Agreement") dated as of April
__, 1994 among the Company, the lenders named therein
(including the Lender) and The Chase Manhattan Bank (National
Association), as Administrative Agent, and evidences Swing
Loans made by the Lender thereunder. Capitalized terms used
in this Note have the respective meanings assigned to them in
the Credit Agreement.
The Credit Agreement provides for the acceleration
of the maturity of this Note upon the occurrence of certain
events and for prepayments of Swing Loans upon the terms and
conditions specified therein.
This Note shall be governed and construed in
accordance with the laws of the State of New York.
GEORGIA GULF CORPORATION
By_________________________
Title:
<PAGE>
SCHEDULE
This Note evidences Swing Loans made under the within-
described Credit Agreement to the Company, on the dates, in
the principal amounts and maturing on the dates set forth
below, subject to the payments and prepayments of principal
set forth below:
Principal Date of Amount Balance
Date Amount of Maturity Payment or Paid or Out-
Made Swing Loan Date Prepayment Prepaid standing
<PAGE>
EXHIBIT D
[Form of Money Market Quote Request]
[Date]
To: The Chase Manhattan Bank, N.A.,
as Administrative Agent
From: Georgia Gulf Corporation
Re: Money Market Quote Request
Pursuant to Section 3.03 of the Credit Agreement
(the "Credit Agreement") dated as of April __, 1994 among
Georgia Gulf Corporation, the Lenders named therein and The
Chase Manhattan Bank, N.A., as Administrative Agent, we hereby
give notice that we request Money Market Quotes for the
following proposed Money Market Borrowing(s):
Borrowing Quotation Interest
Date Date 1/ Amount 2/ Type 3/ Period 4/
Terms used herein have the meanings assigned to them
in the Credit Agreement.
Please respond to this invitation by no later than
[2:00 P.M.] [10:00 A.M.] (New York City time) on [date].
Georgia Gulf Corporation
By______________________
Title:
_____________
* All numbered footnotes appear on the last page of this
Exhibit.
__________
1/ For use if a Money Market Rate in a Set Rate Auction is
requested to be submitted before the Borrowing Date.
2/ Each amount must be $5,000,000 or a larger multiple of
$1,000,000.
3/ Insert either "Margin" (in the case of LIBOR Market
Loans) or "Rate" (in the case of Set Rate Loans).
4/ One, two, three, six or twelve calendar months, in the
case of a LIBOR Market Loan or, in the case of a Set Rate
Loan, a period of up to 360 (but not less than 7) days
after the making of such Set Rate Loan and ending on a
Business Day. The Company may request offers to make
Money Market Loans for up to three different Interest
Periods in a single notice.
<PAGE>
EXHIBIT E
[Form of Money Market Quote]
The Chase Manhattan Bank, N.A.,
as Administrative Agent
Attention: New York Agency
Re: Money Market Quote to
Georgia Gulf Corporation (the "Company")
This Money Market Quote is given in accordance with
Section 3.03(b) of the Credit Agreement (the "Credit
Agreement") dated as of April __, 1994, among Georgia Gulf
Corporation, the Lenders named therein and The Chase Manhattan
Bank, N.A., as Administrative Agent. Terms defined in the
Credit Agreement are used herein as defined therein.
In response to the Company's invitation dated
__________, 19__, we hereby make the following Money Market
Quote(s) on the following terms:
1. Quoting Bank.
2. Person to contact and telephone number at
Quoting Bank.
We hereby offer to make Money Market Loan(s) in the
following principal amounts for the following Interest Periods
and at the following rates:
Borrowing Quotation Interest
Date Date 1/ Amount 2/ Type 3/ Period 4/ Rate 5/
_____________
* All numbered footnotes appear on the last page of this
Exhibit.<PAGE>
We understand and agree that the offer(s) set forth
above, subject to the satisfaction of the applicable
conditions set forth in the Credit Agreement, irrevocably
obligate(s) us to make the Money Market Loan(s) for which any
offer(s) [is] [are] accepted, in whole or in part (subject to
the third sentence of Section 3.03(c) of the Credit
Agreement).
Very truly yours,
[Name of Bank]
By:_______________________
Dated: Authorized Officer
__________
1/ As specified in related Money Market Quote Request.
2/ The principal amount bid for each Interest Period may not
exceed the principal amount requested but must be at
least $5,000,000 or a larger multiple of $1,000,000.
Specify aggregate limitation if the sum of individual
offers exceeds the amount the Lender is willing to lend.
3/ Indicate "Margin" (in the case of LIBOR Market Loans) or
"Rate" (in the case of Set Rate Loans).
4/ Up to 360 (but not less than 7) days for Set Rate Loans;
one, two, three, six or twelve calendar months for LIBOR
Market Loans. The Company may request offers to make
Money Market Loans for up to three different Interest
Periods in a single invitation.
5/ Margin above or below the applicable Eurodollar Rate in
case of LIBOR Market Loans (specify "PLUS" or "MINUS") or
rate of interest per annum (in case of Set Rate Loans)
(rounded upwards in either case, if necessary, to nearest
1/10,000th of 1%).
<PAGE>
EXHIBIT F
FORM OF OPINION OF
COUNSEL TO THE COMPANY
[Dated the Closing Date]
To each of the Lenders
and the Administrative Agent referred to below:
Re: Georgia Gulf Corporation
Gentlemen:
We have acted as special counsel to Georgia Gulf
Corporation, a Delaware corporation (the "Company"), in
connection with the transactions contemplated by that certain
Credit Agreement dated as of April __, 1994 (the "Credit
Agreement") among the Company, each of the Lenders referred to
therein and The Chase Manhattan Bank (National Association),
as Administrative Agent. This opinion is delivered pursuant
to Section 7.01(e) of the Credit Agreement. Capitalized terms
contained but not otherwise defined herein shall have the
meanings ascribed to them in the Credit Agreement whether
directly or by reference therein to definitions contained in
other documents.
In connection with this opinion we have examined and
relied upon originals, or copies certified or otherwise
identified to our satisfaction, of such corporate documents
and records of the Company and certificates of public
officials and other documents, and have received such
information from officers and representatives of the Company,
as we have deemed necessary to enable us to express the
opinions below. We have also relied on certificates of
officers of the Company as to certain factual matters.
In rendering our opinion we have assumed, without
independent investigation, (i) the genuineness of all
signatures, (ii) the authenticity of all documents submitted
to us as originals, (iii) the conformity to authentic original
documents of all documents submitted to us as certified,
conformed or photostatic copies, (iv) the due authorization,
execution and delivery of all documents referred to herein by
the parties thereto other than the Company, and the binding
effect of such documents on such parties other than the
Company, and (v) that each of the Basic Documents has been
duly executed and delivered by each of the parties thereto
substantially in the form thereof submitted to us.
Based on the foregoing, and subject to the further
assumptions, qualifications and limitations hereinafter set
forth, we are of the opinion that:
1. The Company has been duly incorporated, and is
validly existing and in good standing as a corporation, under
the laws of the State of Delaware with all requisite corporate
power and authority to conduct its business as now being
conducted or as proposed to be conducted in the Basic
Documents, and to enter into the Basic Documents and perform
the Basic Documents.
2. Each of the Basic Documents has been duly
authorized, executed and delivered by the Company and
constitutes a valid and binding obligation of the Company
enforceable against it in accordance with its terms, except as
any enforceability thereof may be (a) limited by the effect of
any applicable bankruptcy, insolvency, reorganization,
moratorium or similar laws affecting creditors' rights
generally, and (b) subject to the effect of general principles
of equity (regardless of whether such enforceability is
considered in a proceeding in equity or at law).
3. No authorization, consent or approval or other
action by, and no notice to or filing with, any governmental
authority or regulatory body is required for (i) the due
execution, delivery, recordation or performance by the Company
of any Basic Document, except for (a) filings or other actions
that may be required after the date hereof to maintain
corporate good standing, (b) the exercise of rights and
remedies by the Administrative Agent or one of the Lenders
requiring notice to or filing with any court or any prior
court approval, and (c) authorizations, consents and approvals
that have already been obtained and filings and recordations
that have already been made.
4. To our knowledge, after due inquiry, neither the
Company nor any of its Subsidiaries is an "investment company"
or a company "controlled" by an "investment company" within
the meaning of the Investment Company Act of 1940, as amended,
15 U.S.C. Section 80a-1 et seq.
5. To our knowledge, after due inquiry, neither the
Company nor any of its Subsidiaries is a "holding company" or
an "affiliate" of a "holding company" or a "subsidiary
company" of a "holding company" within the meaning of the
Public Utility Holding Company Act of 1935, as amended, 15
U.S.C. Section 79 et seq.
6. The choice of New York law to govern the Credit
Agreement is a valid and effective choice of law under the
laws of the States of Georgia and Delaware, and adherence to
existing judicial precedents generally would require a court
sitting in the States of Georgia or Delaware to abide by such
choice by law, unless a fundamental policy of the State in
which such court is sitting would be violated.
7. Neither the execution, delivery or performance
by the Company of any of the Basic Documents, nor the
consummation of the transactions therein contemplated in
compliance with the terms and provisions therein (i) conflicts
with or results in any breach of or requires any consent or
constitutes a default under, or results in the creation or
imposition of any Lien on any of the property or assets of any
of the Company or any of its Subsidiaries under, any existing
indenture, mortgage, deed or trust, loan agreement or other
agreement or instrument known to us after due inquiry to which
the Company or any of its Subsidiaries is a party or by which
the Company or any of its Subsidiaries is bound or to which
any of the property or assets of the Company or any of its
Subsidiaries is subject, or (ii) contravenes the provisions of
the existing certificate of incorporation or by-laws of the
Company or any of its Subsidiaries, or any applicable law or
regulation, or any order, writ, injunction or decree of any
court or governmental authority or agency known to us after
due inquiry to be applicable to the Company or any of its
Subsidiaries or their respective businesses or properties.
8. We are not acting as counsel for the Company in
any pending litigation in which the Company is a party, and we
have not had referred to us by the Company for legal advice or
legal representation any matter that we believe might be
deemed to be overtly threatened litigation in which the
Company may become a party, except those matters listed on
Schedule I attached hereto. The statement set forth in the
preceding sentence is limited to those matters that the
Company has referred to us for legal representation or about
which the Company has consulted us as counsel and with respect
to which we have given substantive attention. We have
identified those matters by making inquiry of lawyers
presently in our firm who, according to our records, have been
engaged in legal services on behalf of the Company since
January 1, 1994, and by examining certain current records that
we maintain for our internal operations. In that process we
have not undertaken any independent review of documents or
records concerning the Company that are in our possession. We
disclaim any undertaking to advise you of changes brought to
our attention subsequent to the date of this letter.
9. Neither the Company nor any of its Subsidiaries
is engaged principally, or as one of its important activities,
in the business or extending credit for the purpose of
purchasing or carrying margin stock (within the meaning of
Regulation U or X of the Board of Governors of the Federal
Reserve System).
The foregoing opinion is predicated upon and
qualified in its entirety by the following:
(a) The foregoing opinion is based upon and is
limited exclusively to the laws of the States of New York and
Georgia, the General Corporation Law of the State of Delaware
and the relevant law of the United States of America, and we
render no opinion with respect to the law of any other
jurisdiction.
(b) As used in this opinion, the term "to our
knowledge" or other term or phrase to such effect refers to
the actual knowledge on the date hereof solely of the lawyers
of the firm who are presently representing the Company and its
Subsidiaries and representations made to such lawyers by the
Company and its Subsidiaries in connection with the matters
expressly set forth or described herein.
(c) In rendering the foregoing opinions, we have
relied upon certificates of officers (after the discussion of
the contents thereof with such officers) of the Company or its
Subsidiaries or certificates of others as to the existence or
nonexistence of the circumstances upon which such opinion is
predicated. We have no reason to believe, however, that any
such certificate or representation or warranty is untrue or
inaccurate in any material respect. Whenever our opinion is
based on circumstances "known to us after due inquiry," or "to
our knowledge after due inquiry" we have relied exclusively
upon such certificates and representations and warranties.
(d) We express no opinion as to (i) any provision
of the Credit Agreement or any Note purporting to provide for
the payment of interest on overdue interest; (ii) the second
sentence of Section 12.11 of the Credit Agreement, insofar as
such sentence relates to the subject matter jurisdiction of
the United States District Court for the Southern District of
New York to adjudicate any controversy relating to the Credit
Agreement; or (iii) the effect of the laws of any jurisdiction
(other than the State of New York) wherein any Lender may be
located that limit rates of interest that may be charged or
collected by such Lender. Further, we express no opinion as
to the effect of the compliance or noncompliance of the
Administrative
Agent or any of the Lenders with any state or federal laws or
regulations applicable to the Administrative Agent or any of
the Lenders by reason of the legal or regulatory status or the
nature of the business of the Administrative Agent or any of
the Lenders.
(e) The opinions expressed herein shall be
effective only as of the date of this letter. We do not
assume responsibility for updating this opinion as of any date
subsequent to the date of this letter, and assume no
responsibility for advising you of any changes with respect to
any matters described in this letter that may occur subsequent
to the date of this letter, whether such changes result from
events occurring subsequent to the date of this letter or from
the discovery subsequent to the date of this letter of
information not previously known to us pertaining to events
occurring prior to the date of this letter.
This opinion is furnished to you by us, as special
counsel for the Company, solely for your benefit and the
benefit of your successors as Lenders or as Administrative
Agent based upon the understanding, as we have advised you,
that we are not hereby assuming any professional
responsibility to any other person whatsoever.
Very truly yours,
<PAGE>
SCHEDULE I
Litigation
1. Ronald M. Finley v. Georgia Gulf Corporation, EEOC
Charge (Right to Sue letter has been issued).
2. Roy Gulick v. Tropicana, Georgia Gulf Corporation
and Fruehauf, State District Court for the 285th District, San
Antonio (Bexer County), Texas.
3. Javier Ortiz v. Brand Scaffold, Georgia Gulf
Corporation, et al., State District Court for the 151st
District, Houston (Harris County), Texas.
<PAGE>
EXHIBIT G
FORM OF OPINION OF SPECIAL NEW YORK
COUNSEL TO THE ADMINISTRATIVE AGENT
[Dated the Closing Date]
To the Lenders
and the Administrative Agent
Referred to Below
c/o The Chase Manhattan Bank
(National Association)
1 Chase Manhattan Plaza
New York, New York 10081
Dear Sirs:
We have participated in the preparation of the
Credit Agreement (the "Credit Agreement") dated as of
April __, 1994 among Georgia Gulf Corporation, a Delaware
corporation (the "Company"), the Lenders referred to therein
(the "Lenders") and The Chase Manhattan Bank (National
Association), as Administrative Agent (the "Administrative
Agent"), and have acted as special counsel for the
Administrative Agent for the purpose of rendering this opinion
pursuant to Section 7.01(f) of the Credit Agreement. Terms
defined in the Credit Agreement are used herein as therein
defined.
We have examined originals or copies, certified or
otherwise identified to our satisfaction, of such documents,
corporate records, certificates of public officials and other
instruments and have conducted such other investigations of
fact and law as we have deemed necessary or advisable for
purposes of this opinion.
Upon the basis of the foregoing, we are of the
opinion that:
1. The execution, delivery and performance by the
Company of the Credit Agreement and the Notes delivered on the
date hereof are within the Company's corporate powers and have
been duly authorized by all necessary corporate action.
2. The Credit Agreement constitutes a valid and
binding agreement of the Company and such Notes constitute
valid and binding obligations of the Company.
In giving the foregoing opinion, we express no
opinion as to (1) the effect (if any) of any law of any
jurisdiction (except the State of New York) in which any
Lender is located which limits the rate of interest that such
Lender may charge or collect; (2) whether provisions of the
Basic Documents which permit the Administrative Agent, the
Majority Lenders, or any Lender to take action or make
determinations or to require payments under indemnity and
similar provisions may be subject to a requirement that such
action be taken or such determinations be made on a reasonable
basis and in good faith and that any action or omission to act
in respect of which any such payment is so required be
reasonable and in good faith; or (3) whether a holder of any
Note may, under certain circumstances, be called upon to prove
the outstanding amount of the Loans evidenced thereby.
We are members of the bar of the State of New York
and we do not herein express any opinion as to any matters
governed by any laws other than the laws of the State of New
York and the General Corporation Law of the State of Delaware.
Very truly yours,
