SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of report (Date of earliest event reported) December 23, 1998
Borden Chemicals and Plastics Limited Partnership
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(Exact name of registrant as specific in its charter)
Delaware 1-9699 31-1269627
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(State of incorporation) (Commission File Number) (I.R.S. Employer
(Identification No.)
Highway 73
Geismar, Louisana 70734
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (614) 225-4482
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Item 5. Other Events.
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On December 23, 1998, Borden Chemicals and Plastics Operating Limited
Partnership ("BCPOP") announced that it had reached agreement with
its lending banks on certain waivers and amendments relating to its
revolving credit facility. A press release announcing the agreement is
attached hereto as Exhibit 99.1. The Amended and Restated Credit Agreement
for the facility is attached hereto as Exhibit 99.2.
Item 7. Exhibits
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99.1. Press Release dated December 23, 1998
99.2 Amended and Restated Credit Agreement, dated as of December 23, 1998,
among Borden Chemicals and Plastics Operating Limited Partnership, the
several Lenders from time to time parties thereto, and The Chase
Manhattan Bank, as Administrative Agent.
SIGNATURE
Pursuant to the requirements of Section 12 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.
BORDEN CHEMICALS AND PLASTICS
LIMITED PARTNERSHIP
By: BCP Management, Inc., its general partner
By: /s/ Ronald B. Wiles
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Name: Ronald B. Wiles
Title: Chief Financial Officer and Treasurer
DATED: December 29, 1998
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EXHIBIT INDEX
Exhibit No.
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99.1 Press Release dated December 23, 1998.
99.2 Amended and Restated Credit Agreement, dated as of December 23, 1998,
among Borden Chemicals and Plastics Operating Limited Partnership, the
several Lenders from time to time parties thereto, and The Chase
Manhattan Bank, as Administrative Agent.
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BCP A Delaware Limited Partnership
BORDEN CHEMICALS and PLASTICS
BCP Management, Inc., General Partner
EXHIBIT 99.1
FOR IMMEDIATE RELEASE Contact:
December 23, 1998 Peter F. Loscocco
614/225-4482
Borden Chemicals and Plastics Obtains
Covenant Waivers For Credit Facility
Columbus, Ohio (December 23, 1998) -- Borden Chemicals and Plastics
Operating Limited Partnership (NYSE: BCU) announced today that it has
reached agreement with participant banks on amendments to its revolving
credit facility that will provide the partnership with continued access to
credit and enhanced financial flexibility.
The new two-year agreement waives the partnership's non-compliance with
credit facility covenants at the end of the third quarter, and provides
relaxed coverage ratio covenants through Dec. 31, 2000.
Initial borrowings under the facility will be $48.8 million, leaving
$41.2 million available to the partnership under the agreement, once certain
collateral arrangements are final. A copy of the full credit agreement will
be included in a Form 8K filing with the Securities and Exchange Commission.
Forward-Looking Statements
This news release contains forward-looking statements subject to the
"safe harbor" provisions of the Private Securities Litigation Reform Act of
1995. These include statements regarding the Partnership's continued access
to credit to meet future business needs. These forward-looking statements
are based on a number of assumptions and forecasts, and actual results may be
materially different from those expressed or implied by such statements.
Factors affecting future results include, but are not limited to, changes in
the demand for and pricing of products, changes in industry production
capacities, and changes in the supply of and costs of significant raw
materials. Discussion of these and other factors and risks are discussed in
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detail in the Partnership's Form 10-K annual report filed with the Securities
and Exchange Commission.
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AMENDED AND RESTATED CREDIT AGREEMENT dated as of December 23,
1998, among BORDEN CHEMICALS AND PLASTICS OPERATING LIMITED PARTNERSHIP, a
Delaware limited partnership (the "Borrower"), the lending institutions from
time to time parties hereto (each a "Lender" and, collectively, the
"Lenders"), and THE CHASE MANHATTAN BANK, as Administrative Agent (such term
and each other capitalized term used but not defined in this introductory
statement having the meaning provided in Section 1).
The Borrower and the Lenders are parties to a Credit Agreement
dated as of December 19, 1997 (as in effect immediately prior to the date
hereof, the "Original Credit Agreement"). Certain Events of Default have
occurred and are continuing under the Original Credit Agreement and the
parties hereto desire to amend and restate the Original Credit Agreement in
the form hereof in order to make certain changes as set forth herein and to
waive such Events of Default, subject to the terms and conditions set forth
herein. Accordingly, the parties hereto agree as follows:
SECTION 1. Definitions. As used herein, the following terms shall
have the meanings specified in this Section 1 unless the context otherwise
requires (it being understood that defined terms in this Agreement shall
include in the singular number the plural and in the plural the singular):
"ABR" shall mean, for any day, a rate per annum (rounded upwards,
if necessary, to the next 1/16 of 1%) equal to the greatest of (a) the Prime
Rate in effect on such day, (b) the Base CD Rate in effect on such day plus
1% and (c) the Federal Funds Effective Rate in effect on such day plus 1/2 of
1%. Any change in the ABR due to a change in the Prime Rate, the Three-Month
Secondary CD Rate or the Federal Funds Effective Rate shall be effective as
of the opening of business on the effective day of such change in the Prime
Rate, the Three-Month Secondary CD Rate or the Federal Funds Effective Rate,
respectively.
"ABR Loan" shall mean each Loan bearing interest at the rate
provided in Section 2.8(a) and, in any event, shall include all Swingline
Loans.
"ABR Revolving Credit Loan" shall mean any Revolving Credit Loan
bearing interest at a rate determined by reference to the ABR.
"Account" shall mean any right to payment for goods sold or for
services rendered that constitutes an "Account Receivable" as defined in the
Security Agreement.
"Account Debtor" shall mean any Person that is obligated to the
Borrower or a Subsidiary under, with respect to, or on account of, an
Account.
"Adjusted Total Revolving Credit Commitment" shall mean at any time
the Total Revolving Credit Commitment less the aggregate Revolving Credit
Commitments of all Defaulting Lenders.
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"Administrative Agent" shall mean Chase, together with its
affiliates, as the arranger of the Revolving Credit Commitments and as the
administrative agent for the Lenders under this Agreement.
"Administrative Agent's Office" shall mean the office of the
Administrative Agent located at 270 Park Avenue, New York, New York 10017, or
such other office in New York City as the Administrative Agent may hereafter
designate in writing as such to the other parties hereto.
"Affiliate" shall mean, with respect to any Person, any other
Person directly or indirectly controlling, controlled by, or under direct or
indirect common control with such Person. A Person shall be deemed to control
a corporation if such Person possesses, directly or indirectly, the power (a)
to vote 10% or more of the securities having ordinary voting power for the
election of directors of such corporation or (b) to direct or cause the
direction of the management and policies of such corporation, whether through
the ownership of voting securities, by contract or otherwise.
"Aggregate Revolving Credit Outstandings" shall have the meaning
provided in Section 5.2(a).
"Agreement" shall mean this Amended and Restated Credit Agreement,
as the same may be amended, supplemented or otherwise modified from time to
time.
"Applicable Margin" shall mean, with respect to each Eurodollar
Loan at any date, the applicable percentage set forth in the table below
under the caption "Applicable margin", based upon the ratings of the Index
Debt of the Borrower in effect on such date:
Ratings Applicable
S&P/Moody's Margin
Category 1 BBB/Baa2 or higher 0.500%
Category 2 BBB-/Baa3 0.625%
Category 3 BB+/Ba1 0.750%
Category 4 BB/Ba2 0.875%
Category 5 Lower than BB/Ba2 1.250%
For purposes of the foregoing, (i) if no rating for the Index Debt
of the Borrower shall be available from either of Moody's or S&P, such rating
agency shall be deemed to have established a rating for Index Debt of the
Borrower in Category 5 unless the absence of a rating from such rating agency
is due to circumstances outside the control of the Borrower, in which case
such rating agency shall be deemed to have established a rating for Index
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Debt of the Borrower in the same Category as the rating established by the
other such rating agency, (ii) if the ratings established or deemed to have
been established by Moody's and S&P for the Borrower shall fall within
different Categories, the Applicable Percentage shall be based upon the
superior (or numerically lower) Category, unless the ratings differ by more
than one Category, in which case, the governing rating shall be the rating
next below the higher of the two, and (iii) if any rating established or
deemed to have been established by Moody's or S&P shall be changed (other
than as a result of a change in the rating system of either Moody's or S&P),
such change shall be effective as of the date on which such change is first
announced by the rating agency making such change. Each such change in the
Applicable Percentage shall apply to all Eurodollar Loans that are
outstanding at any time during the period commencing on the effective date of
such change and ending on the date immediately preceding the effective date
of the next such change. If the rating system of either Moody's or S&P shall
change prior to the Revolving Credit Maturity Date, the Borrower and the
Lenders shall negotiate in good faith to amend the references to specific
ratings in this definition to reflect such changed rating system.
Notwithstanding the foregoing, "Applicable Margin" shall mean (A)
with respect to each Eurodollar Loan at any date, the applicable percentage
set forth in the table below under the caption "Eurodollar Spread" if such
able percentage based on the ratings of the Index Debt of the Borrower set
forth in the table above on any such date and (B) with respect to each ABR
Loan at any date, the applicable percentage set forth in the table below
under the caption "ABR Spread", in each case based upon the Consolidated
Total Debt to Consolidated EBITDA Ratio of the Borrower in effect on such
date (provided that the "Applicable Margins" set forth in Categories 10 and
11 below may be reduced with the approval of the Required Lenders to
percentages not less than those set forth in Category 9 below):
Consolidated Total Debt to Consolidated Eurodollar ABR
EBITDA Ratio Spread Spread
Category 1: Consolidated Total Debt to
Consolidated EBITDA Ratio is less than or 0.625% 0.000%
equal to 2.0 to 1.0
Category 2: Consolidated Total Debt to
Consolidated EBITDA Ratio is greater than 0.750% 0.000%
2.0 to 1.0 and less than 2.5 to 1.0
Category 3: Consolidated Total Debt to
Consolidated EBITDA Ratio is greater than 0.875% 0.000%
or equal to 2.5 to 1.0 and less than 3.0
to 1.0
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Category 4: Consolidated Total Debt to
Consolidated EBITDA Ratio is greater than 1.000% 0.000%
or equal to 3.0 to 1.0 and less than 3.5
to 1.0
Category 5: Consolidated Total Debt to
Consolidated EBITDA Ratio is greater than 1.500% 0.250%
or equal to 3.5 to 1.0 and less than 4.0
to 1.0
Category 6: Consolidated Total Debt to
Consolidated EBITDA Ratio is greater than 1.750% 0.500%
or equal to 4.0 to 1.0 and less than 4.5
to 1.0
Category 7: Consolidated Total Debt to
Consolidated EBITDA Ratio 2.000% 0.750% is 2.000% 0.750%
greater than or equal to 4.5 to 1.0 and
less than 5.0 to 1.0
Category 8: Consolidated Total
Debt to Consolidated EBITDA Ratio is 2.225% 1.000%
greater than or equal to 5.0 to 1.0 and
less than 5.5 to 1.0
Category 9: Consolidated Total
Debt to Consolidated EBITDA Ratio is 2.500% 1.250%
greater than or equal to 5.5 to 1.0 and
less than 6.5 to 1.0
Category 10: Consolidated Total
Debt to Consolidated EBITDA Ratio is 3.500% 2.250%
greater than or equal to 6.5 to 1.0 and
less than 7.5 to 1.0
Category 11: Consolidated Total Category
11 Rate Debt to Consolidated EBITDA Ratio Category 11 Rate
is greater than or equal to 7.5 to 1.0
For purposes of the foregoing, (i) the Consolidated Total Debt to
Consolidated EBITDA Ratio shall be determined as of the end of each fiscal
quarter of the Borrower's fiscal year based upon the Borrower's consolidated
financial statements delivered pursuant to Section 9.1 (a) or (b) and (ii)
each change in the Applicable Margin resulting from a change in the
Consolidated Total Debt to Consolidated EBITDA Ratio shall be effective
during the period commencing on and including the date of delivery to the
Administrative Agent of such consolidated financial statements indicating
such change and ending on the date immediately preceding the effective date
of the next such change; provided that if (A) the Borrower fails to deliver
the consolidated financial statements required to be delivered by it pursuant
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to Section 9.1(a) or (b) within the time required under such Section, (B)
when such statements are delivered there is a change in the Applicable Margin
resulting from a change of the Consolidated Total Debt to Consolidated EBITDA
Ratio, and (C) during the period from the expiration of the time for delivery
of such consolidated financial statements until the date of delivery thereof
any interest accrued on any Revolving Credit Loans, then the next payment of
interest on any Revolving Credit Loans made under this Agreement shall be
adjusted upwards or downwards to reflect the difference between (x) the
amount of such interest that accrued during such period and (y) the amount of
such interest that would have accrued during such period if such consolidated
financial statements had been delivered on the last day of the period
required by Section 9.1(a) or (b).
"Attributable Indebtedness" in respect of a sale and leaseback
arrangement means, as at the time of determination, the present value
(discounted at ABR, compounded annually) of the total obligations of the
lessee for rental payments during the remaining term of the lease included in
such arrangement (including any period for which such lease has been extended).
"Authorized Officer" shall mean the Chairman of the Board, the
President, the Chief Financial Officer, the Treasurer or any other senior
officer of the General Partner designated as such in writing to the
Administrative Agent by the General Partner.
"Available Commitment" shall mean an amount equal to the excess, if
any, of (a) the amount of the Total Revolving Credit Commitment over (b) the
sum of (i) the aggregate principal amount of all Revolving Credit Loans (but
not Swingline Loans) then outstanding and (ii) the aggregate Letter of Credit
Outstandings at such time.
"Bankruptcy Code" shall have the meaning provided in Section 11.5.
"Base CD Rate" shall mean the sum of (a) the product of (i) the
Three-Month Secondary CD Rate and (ii) a fraction, the numerator of which is
one and the denominator of which is one minus the C/D Reserve Percentage and
(b) the C/D Assessment Rate.
"BCPM" shall mean BCP Management, Inc., a Delaware corporation, and
its successors.
"Board" shall mean the Board of Governors of the Federal Reserve
System of the United States (or any successor).
"Borden" shall mean Borden, Inc., a New Jersey corporation, and its
successors (other than as a result of any transaction described in clause (a)
of the definition of "Change in Control", as if Borden, Inc. were deemed for
such purposes to be the Borrower).
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"Borrower" shall have the meaning provided in the preamble to this
Agreement.
"Borrowing" shall mean and include (a) the incurrence of Swingline
Loans from Chase on a given date and (b) the incurrence of one Type of
Revolving Credit Loan on a given date (or resulting from conversions on a
given date) having, in the case of Eurodollar Loans, the same Interest Period
(provided that ABR Loans incurred pursuant to Section 2.10(b) shall be
considered part of any related Borrowing of Eurodollar Loans).
"Business Day" shall mean (a) for all purposes other than as
covered by clause (b) below, any day excluding Saturday, Sunday and any day
that shall be in The City of New York a legal holiday or a day on which
banking institutions are authorized by law or other governmental actions to
close and (b) with respect to all notices and determinations in connection
with, and payments of principal and interest on, Eurodollar Loans, any day
that is a Business Day described in clause (a) and which is also a day for
trading by and between banks in Dollar deposits in the relevant interbank
Eurodollar market.
"Capital Expenditures" shall mean, for any period, the aggregate of
all expenditures (whether paid in cash or accrued as liabilities and
including in all events all amounts expended or capitalized under Capital
Leases, but excluding any amount representing capitalized interest) by the
Borrower and its Subsidiaries during such period that, in conformity with
GAAP, are or are required to be included as additions during such period to
property, plant or equipment reflected in the consolidated balance sheet of
the Borrower and its Subsidiaries, provided that the term "Capital
Expenditures" shall not include (a) expenditures made in connection with the
replacement, substitution or restoration of assets (i) to the extent financed
from insurance proceeds paid on account of the loss of or damage to the
assets being replaced or restored, or (ii) with awards of compensation
arising from the taking by eminent domain or condemnation of the assets being
replaced, or (b) the purchase price of equipment that is purchased
simultaneously with the trade-in of existing equipment to the extent that the
gross amount of such purchase price is reduced by the credit granted by the
seller of such equipment for the equipment being traded in at such time.
"Capitalized Lease Obligations" shall mean, as applied to any
Person, all obligations under Capital Leases of such Person or any of its
Subsidiaries, in each case taken at the amount thereof accounted for as
liabilities in accordance with GAAP.
"Capital Lease", as applied to any Person, shall mean any lease of
any property (whether real, personal or mixed) by that Person as lessee that,
in conformity with GAAP, is, or is required to be, accounted for as a capital
lease on the balance sheet of that Person.
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"Capital Stock" shall mean any and all shares, interests, rights to
purchase, warrants, options, participations or other equivalents of or
interests in (however designated) capital stock, including any preferred
stock, and with respect to a partnership, any interest therein (whether
general or limited) that confers on a Person the right to receive a share of
the profits and losses of, or distributions of assets of, such partnership;
provided that Capital Stock shall not include any debt security that is
convertible into or exchangeable for Capital Stock.
"Category 11 Rate" shall mean (a) prior to the Perfection Date, a
rate per annum equal to (i) 4.000%, in the case of the Applicable margin with
respect to Eurodollar Loans, or (ii) 2.750%, in the case of the Applicable
Margin with respect to ABR Loans, and (b) on and after the Perfection Date, a
rate per annum equal to (i) 3.750%, in the case of the Applicable Margin with
respect to Eurodollar Loans, or (ii) 2.500%, in the case of the Applicable
margin with respect to ABR Loans.
"C/D Assessment Rate" shall mean for any day as applied to any ABR
Loan, the annual assessment rate in effect on such day that is payable by a
member of the Bank Insurance Fund maintained by the Federal Deposit Insurance
Corporation or any successor thereto (the "FDIC") classified as well-
capitalized and within supervisory subgroup "B" (or a comparable successor
assessment risk classification) within the meaning of 12 C.F.R.
Section 327.4(a) (or any successor provision) to the FDIC for the FDIC's
insuring time deposits at offices of such institution in the United States.
"C/D Reserve Percentage" shall mean for any day as applied to any
ABR Loan, the percentage (expressed as a decimal) that is in effect on such
day, as prescribed by the Board, for determining the reserve requirement for
a Depositary Institution (as defined in Regulation D of the Board) in respect
of new non-personal time deposits in Dollars having a maturity that is 30
days or more.
A "Change in Control" occurs when (i) any person or "group" for
purposes of Section 13(d) of the Exchange Act (a "Group"), other than
Permitted Holders, shall beneficially own, directly or indirectly, more than
50% of the total voting power of all classes of Voting Stock of the General
Partner, the Holding Company or the Borrower, (ii)(A) the Borrower shall
sell, lease, convey or otherwise dispose of all or substantially all the
Borrower's assets to any person or Group or (B) the Borrower shall
consolidate with or merge into another person or another person shall
consolidate with or merge into the Borrower, in case of either of the
foregoing, in a transaction in which the outstanding Voting Stock of the
Borrower is reclassified or changed into or exchanged for cash, securities or
other property, other than, in the case of either of clauses (A) or (B), to,
with or into, as applicable, one or more Permitted Holders or a person, more
than 50% of the total voting power of all classes of Voting Stock of which,
after giving effect to such transaction, is beneficially owned, directly or
indirectly, by one or more Permitted Holders or (iii) the Borrower, the
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Holding Company or the General Partner shall adopt a plan of liquidation or
dissolution (unless all or substantially all the Borrower's assets are
distributed pursuant to such plan to one or more Permitted Holders).
"Chase" shall mean The Chase Manhattan Bank, a New York banking
corporation, and any successor thereto by merger, consolidation or otherwise.
"Closing Date" shall mean the date on which all conditions
precedent for the effectiveness of the amendment and restatement of the
Original Credit Agreement in the form of this Agreement, as set forth in
Section 6.1, are satisfied.
"Code" shall mean the Internal Revenue Code of 1986, as amended
from time to time, and the regulations promulgated and rulings issued
thereunder. Section references to the Code are to the Code, as in effect at
the date of this Agreement, and any subsequent provisions of the Code,
amendatory thereof, supplemental thereto or substituted therefor.
"Collateral" shall mean any and all "Collateral", as defined in the
Security Agreement.
"Collateral Certificate" shall mean a certificate signed by an
Authorized Officer providing information with respect to the inventory and
accounts receivable of the Borrower and its Subsidiaries, substantially in
the form of Exhibit J or any other form approved by the Administrative Agent.
"Collateral Coverage Ratio" shall mean the ratio of (a) the sum of
the total amounts of Eligible Accounts Receivable and Eligible Inventory of
the Borrower and its Subsidiaries to (b) the Total Revolving Credit
Commitment.
"Confidential Information" shall have the meaning provided in
Section 13.16.
"Confidential Information Memorandum" shall mean the Confidential
Information Memorandum of the Borrower dated November 1997 delivered to the
Lenders in connection with this Agreement.
"Consolidated EBITDA Coverage Ratio" shall mean the ratio of (a)
the aggregate amount of EBITDA for the most recent Test Period to (b)
Consolidated Interest Expense for such Test Period.
"Consolidated Interest Expense" shall mean, for any period, the
total interest expense, net of total interest income, of the Borrower and its
consolidated Subsidiaries for such period, including (i) interest expense
attributable to Capitalized Lease Obligations, (ii) capitalized interest,
(iii) commissions, discounts and other fees and charges owed with respect to
letters of credit and bankers' acceptance financing, and (iv) net costs under
Hedging Agreements (including amortization of fees), but excluding
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amortization of deferred financing costs and any other non-cash items
included in interest expense.
"Consolidated Net Income" shall mean, for any period, the
consolidated net income (or loss) of the Borrower and its consolidated
Subsidiaries for such period, excluding extraordinary gains and losses,
determined in accordance with GAAP.
"Consolidated Net Tangible Assets" shall mean the total assets of
the Borrower and its Subsidiaries appearing on a consolidated balance sheet
of the Borrower and its Subsidiaries (prepared in accordance with GAAP) as of
the end of the most recent fiscal quarter, after (a) adding thereto all
Attributable Indebtedness of the Borrower and its Subsidiaries in respect of
any sale and leaseback arrangement not capitalized on such balance sheet, (b)
eliminating all intercompany transactions and all amounts properly
attributable to minority interests, if any, in the stock and surplus of
Subsidiaries and (c) deducting therefrom (without duplicating of deductions):
(i) all liabilities of the Borrower and its Subsidiaries
other than Indebtedness;
(ii) the net book amount of all assets, after deducting any
reserves applicable thereto, which would be treated as
intangible under GAAP, including such items as goodwill,
trademarks, trade names, service marks, brand names,
copyrights, patents and licenses, and rights with respect
to the foregoing, unamortized debt discount and expense
and organization expenses;
(iii) any write-up in the book value of any asset on the books
of the Borrower or any Subsidiary resulting from a
revaluation thereof subsequent to the date of the Note
Indenture (other than the write-up of the book value of
an asset made in accordance with purchase accounting
under GAAP in connection with the purchase of such
asset);
(iv) all deferred charges (other than prepaid expenses); and
(v) all reserves, including, without limitation, reserves for
deferred income taxes, liabilities (fixed or contingent),
depreciation, obsolescence, depletion, insurance and
inventory valuation, which appear or under GAAP are
required to appear on such balance sheet.
"Consolidated Senior Debt" shall mean, as of any date of
determination, Consolidated Total Debt minus all Permitted Subordinated Debt
outstanding on such date.
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"Consolidated Total Debt" shall mean, as of any date of
determination, the sum of (a) all Indebtedness of the Borrower and its
Subsidiaries for borrowed money outstanding on such date and (b) all
Capitalized Lease obligations of the Borrower and its Subsidiaries
outstanding on such date, all calculated on a consolidated basis in
accordance with GAAP.
"Consolidated Total Debt to Consolidated EBITDA Ratio" shall mean,
as of any date of determination, the ratio of (a) Consolidated Total Debt as
of such date to (b) EBITDA for the most recent Test Period ended on or prior
to such date.
"Credit Documents" shall mean this Agreement, any promissory notes
issued by the Borrower hereunder, the Security Documents and the agreement of
the General Partner referred to in Section 6.1(m).
"Credit Event" shall mean and include the making (but not the
conversion or continuation) of a Loan and the issuance of a Letter of Credit.
"Default" shall mean any event, act or condition that with notice
or lapse of time, or both, would constitute an Event of Default.
"Defaulting Lender" shall mean any Lender with respect to which a
Lender Default is in effect.
"Disqualified Capital Stock" shall mean any Capital Stock that is
Redeemable Stock or Exchangeable Stock.
"Dollars" and "$" shall mean dollars in lawful currency of the
United States of America.
"Drawing" shall have the meaning provided in Section 3.4(b).
"EBITDA" for any period shall mean (a) the Consolidated Net Income
for such period, plus (b) the sum of the following to the extent deducted in
calculating such Consolidated Net Income: (i) income tax expense, (ii)
Consolidated Interest Expense, (iii) depreciation expense, (iv) amortization
expense, (v) non-recurring charges or losses, (vi) any deductions for
minority interest expense, and (vii) all other noncash items reducing
Consolidated Net Income, less (c) the sum of all noncash items increasing
Consolidated Net Income and all nonrecurring gains increasing Consolidated
Net Income; provided, however, that if, subsequent to the first day of any
Test Period, any Permitted Acquisition occurs or any sale, transfer or other
disposition of any material property, business or assets of the Borrower or
any Subsidiary is consummated (excluding sales, transfers and dispositions in
the ordinary course of business), then EBITDA for such Test Period shall be
determined on a pro forma basis as though such Permitted Acquisition or sale,
transfer or disposition, as the case may be, had occurred on the first day of
such Test Period, in each case based upon the actual amounts attributable to
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the assets or Person acquired (in the case of a Permitted Acquisition) or the
property, businesses or assets sold, transferred or otherwise disposed of, as
the case may be, for the relevant period.
"Eligible Accounts Receivable" shall mean shall mean at the time of
any determination thereof all Accounts that satisfy the following criteria at
the time of creation and continue to meet the same at the time of such
determination: (a) such Account has been invoiced and is not, and not more
than 50% of the aggregate amount of Accounts from the same Account Debtor and
any Affiliates thereof are, more than 120 days past due; (b) such Account is
denominated in dollars; (c) such Account arose from a completed, outright and
lawful sale of goods or from the completed performance and acceptance of
services by the Borrower or a Subsidiary; (d) such Account is subject to a
perfected first priority security interest in favor of the Administrative
Agent for the benefit of the Secured Parties pursuant to the Security
Agreement and is not subject to any other Lien; (e) such Account arose in the
ordinary course of business of the Borrower or a Subsidiary and, to the best
knowledge of the Borrower and its Subsidiaries, no event of death,
bankruptcy, insolvency or inability to pay creditors generally of the Account
Debtor thereunder has occurred, and no notice thereof has been received; (f)
with respect to such Account, the Account Debtor (except in the case of Borden
and Persons that are Affiliates of the Borrower solely as a result of the
Borrower's affiliation with Borden) is not an Affiliate or Subsidiary of the
Borrower or an Affiliate of any of the Borrower's Subsidiaries; (g) such
Account is in full force and effect and constitutes a legal, valid and binding
obligation of the Account Debtor enforceable in accordance with its terms; and
(h) the Account Debtor with respect to such Account has not asserted that such
Account is, and neither the Borrower nor any of its Subsidiaries is aware of
any basis upon which such Account could be, subject to any defense, offset,
deduction, credit or dispute (provided that if such Account is subject to such
a defense, offset, deduction, credit or dispute, it may be an Eligible Account
Receivable to the extent it is not so subject).
"Eligible Assignee" shall mean any bank or other financial
institution, or any fund that is regularly engaged in making, purchasing or
investing in loans or securities, provided in each case that such bank,
financial institution or fund either (a) has a combined capital and surplus
and undivided profits of not less than $500,000,000 or (b) has a credit
rating (i) with respect to its commercial paper from either S&P or Moody's
that is at least A-1 or P-1 or (ii) with respect to its long-term unsecured
debt securities or long-term certificates of deposit from either S&P or
Moody's that is at least BBB- or Baa3.
"Eligible Inventory" shall mean at the time of any determination
thereof, without duplication, the book value (determined in accordance with
GAAP) of all inventory (other than discontinued inventory) to the extent that
(a) the Borrower or a Subsidiary has good and unencumbered title thereto
(subject to the Lien of the Security Agreement), and (b) the Administrative
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Agent on behalf of the Secured Parties possesses a valid first priority
perfected security interest therein pursuant to the Security Agreement.
"Environmental Claims" shall mean any and all administrative,
regulatory or judicial actions, suits, demands, demand letters, claims,
liens, notices of noncompliance or violation, investigations (other than
internal reports prepared by the Borrower or any of its Subsidiaries (a) in
the ordinary course of such Person's business or (b) as required in
connection with a financing transaction or an acquisition or disposition of
real estate) or proceedings relating in any way to any Environmental Law or
any permit issued, or any approval given, under any such Environmental Law
(hereinafter, "Claims"), including, without limitation, (i) any and all
Claims by governmental or regulatory authorities for enforcement, cleanup,
removal, response, remedial or other actions or damages pursuant to any
applicable Environmental Law and (ii) any and all Claims by any third party
seeking damages, contribution, indemnification, cost recovery, compensation
or injunctive relief resulting from Hazardous Materials or arising from
alleged injury or threat of injury to health, safety or the environment.
"Environmental Law" shall mean any applicable Federal, state,
foreign or local statute, law, rule, regulation, ordinance, code and rule of
common law now or hereafter in effect and in each case as amended, and any
binding judicial or administrative interpretation thereof, including any
binding judicial or administrative order, consent decree or judgment, relating
to the environment, human health or safety or Hazardous Materials.
"ERISA" shall mean the Employee Retirement Income Security Act of
1974, as amended from time to time. Section references to ERISA are to ERISA
as in effect at the date of this Agreement and any subsequent provisions of
ERISA amendatory thereof, supplemental thereto or substituted therefor.
"ERISA Affiliate" shall mean each person (as defined in Section
3(9) of ERISA) that together with the Borrower or a Subsidiary would be
deemed to be a "single employer" within the meaning of Section 414(b) or (c)
of the Code or, solely for purposes of Section 302 of ERISA and Section 412
of the Code, is treated as a single employer under Section 414 of the Code.
"Eurodollar Loan" shall mean any Revolving Credit Loan bearing
interest at a rate determined by reference to the Eurodollar Rate.
"Eurodollar Rate" shall mean, in the case of any Eurodollar Loan,
with respect to each day during each Interest Period pertaining to such
Eurodollar Loan, the rate of interest determined on the basis of the rate for
deposits in Dollars for a period equal to such Interest Period commencing on
the first day of such Interest Period appearing on Page 3750 of the Telerate
screen as of 11:00 A.M., London time, two Business Days prior to the
beginning of such Interest Period. In the event that such rate does not
appear on Page 3750 of the Telerate Service (or otherwise on such service),
the "Eurodollar Rate" for the purposes of this paragraph shall be determined
by reference to such other publicly available service for displaying
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Eurodollar rates as may be agreed upon by the Administrative Agent and the
Borrower or, in the absence of such agreement, the Eurodollar Rate" for the
purposes of this paragraph shall instead be the rate per annum notified to
the Administrative Agent by the Reference Lender as the rate at which the
Reference Lender is offered Dollar deposits at or about 10:00 A.M., New York
time, two Business Days prior to the beginning of such Interest Period, in the
interbank eurodollar and foreign currency and exchange operations in respect of
its Eurodollar Loans are then being conducted for delivery on the first day of
such Interest Period for the number of days comprised therein and in an amount
comparable to the amount of its Eurodollar Loans, to be outstanding during such
Interest Period.
"Event of Default" shall have the meaning provided in Section 11.
"Exchange Act" shall mean the Securities Exchange Act of 1934 as in
effect on the date hereof.
"Exchangeable Stock" shall mean any Capital Stock that is
exchangeable or convertible into another security (other than Capital Stock
of the Borrower that is neither Exchangeable Stock nor Redeemable Stock).
"Federal Funds Effective Rate" shall mean, for any day, the
weighted average of the per annum rates on overnight federal funds
transactions with members of the Federal Reserve System arranged by federal
funds brokers, as published on the next succeeding Business Day by the
Federal Reserve Bank of New York, or, if such rate is not so published for
any day that is a Business Day, the average of the quotations for the day of
such transactions received by the Administrative Agent from three federal
funds brokers of recognized standing selected by it.
"Fees" shall mean all amounts payable pursuant to, or referred to
in, Section 4.1.
"Final Date" shall mean the date on which the Revolving Credit
Commitments shall have terminated, no Loans shall be outstanding and the
Letter of Credit Outstandings shall have been reduced to zero.
"Fronting Fee" shall have the meaning provided in Section 4.1(c).
"GAAP" shall mean generally accepted accounting principles in the
United States of America as in effect from time to time; provided, however,
that if there occurs after the date hereof any change in GAAP that affects in
any respect the calculation of any covenant contained in Section 10, the
Lenders and the Borrower shall negotiate in good faith amendments to the
provisions of this Agreement that relate to the calculation of such covenant
with the intent of having the respective positions of the Lenders and the
Borrower after such change in GAAP conform as nearly as possible to their
respective positions as of the date of this Agreement and, until any such
amendments have been agreed upon, the covenants in Section 10 shall be
calculated as if no such change in GAAP has occurred.
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"General Partner" shall mean BCPM.
"Governmental Authority" shall mean any nation or government, any
state or other political subdivision thereof, and any entity exercising
executive, legislative, judicial, regulatory or administrative functions of
or pertaining to government.
"Guarantee Obligations" shall mean, as to any Person, any
obligation of such Person guaranteeing or intended to guarantee any
Indebtedness of any other Person (the "primary obligor") in any manner,
whether directly or indirectly, including, without limitation, any obligation
of such Person, whether or not contingent, (a) to purchase any such
Indebtedness or any property constituting direct or indirect security
therefor, (b) to advance or supply funds (i) for the purchase or payment of
any such Indebtedness or (ii) to maintain working capital or equity capital
of the primary obligor or otherwise to maintain the net worth or solvency of
the primary obligor, (c) to purchase property, securities or services
primarily for the purpose of assuring the owner or any such Indebtedness of
the ability of the primary obligor to make payment of such Indebtedness, or
(d) otherwise to assure or hold harmless the owner of such Indebtedness
against loss in respect thereof; provided, however, that the term "Guarantee
Obligations" shall not include endorsements of instruments for deposit or
collection in the ordinary course of business. The amount of any Guarantee
Obligation shall be deemed to be an amount equal to the stated or determinable
amount of the Indebtedness in respect of which such Guarantee Obligation is
made or, if not stated or determinable, the maximum reasonably anticipated
liability in respect thereof (assuming such Person is required to perform
thereunder) as determined by such Person in good faith.
"Hazardous Materials" shall mean (a) any petroleum or petroleum
products, radioactive materials, friable asbestos, urea formaldehyde foam
insulation, transformers or other equipment that contain dielectric fluid
containing regulated levels of polychlorinated biphenyls, and radon gas; (b)
any chemicals, materials or substances defined as or included in the
definition of "hazardous substances", "hazardous waste", "hazardous
materials", "extremely hazardous waste", "restricted hazardous waste", "toxic
substances", "toxic pollutants", "contaminants", or "pollutants", or words of
similar import, under any applicable Environmental Law; and (c) any other
chemical, material or substance, exposure to which is prohibited, limited or
regulated by any Governmental Authority.
"Hedge Agreements" shall mean interest rate swap, cap or collar
agreements, interest rate future or option contracts, currency swap
agreements, currency future or option contracts and other similar agreements
entered into by the Borrower in order to protect the Borrower or any of its
Subsidiaries against fluctuations in interest rates or currency exchange
rates.
"Holding Company" shall mean Borden Chemicals and Plastics Limited
Partnership, a Delaware limited partnership, and its successors.
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"Indebtedness" of any Person shall mean (a) all indebtedness of
such Person for borrowed money, (b) the deferred purchase price of assets or
services that in accordance with GAAP would be shown on the liability side of
the balance sheet of such Person, (c) the face amount of all letters of
credit issued for the account of such Person and, without duplication, all
drafts drawn thereunder, (d) all Indebtedness of a second Person secured by
any Lien on any property owned by such first Person, whether or not such
Indebtedness has been assumed, (e) all Capitalized Lease obligations of such
Person, (f) all obligations of such Person under interest rate swap, cap or
collar agreements, interest rate future or option contracts, currency swap
agreements, currency future or option contracts and other similar agreements
and (g) without duplication, all Guarantee Obligations of such Person;
provided that Indebtedness shall not include trade payables and accrued
expenses, in each case arising in the ordinary course of business.
"Index Debt" means the senior, unsecured, long-term, non-credit-
enhanced Indebtedness of the Borrower.
"Interest Period" shall mean, with respect to any Eurodollar Loan,
the interest period applicable thereto, as determined pursuant to Section
2.9.
"Investment" in any Person means any loan or advance to, any
acquisition of Capital Stock, obligation or other security of, or capital
contribution or other investment in, such Person.
"KKR" shall mean each of Kohlberg Kravis Roberts & Co., L.P. and
KKR Associates, L.P.
"L/C Maturity Date" shall mean the date that is five Business Days
prior to the Revolving Credit Maturity Date.
"L/C Participant" shall have the meaning provided in Section
3.3(a).
"L/C Participation" shall have the meaning provided in Section
3.3(a).
"Lender" shall have the meaning provided in the preamble to this
Agreement.
"Lender Default" shall mean (a) the failure (which has not been
cured) of a Lender to make available its portion of any Borrowing or to fund
its portion of any unreimbursed payment under Section 3.3 or (b) a Lender
having notified the Administrative Agent and/or the Borrower that it does not
intend to comply with the obligations under Section 2.1(a), 2.1(c) or 3.3, in
the case of either clause (a) or clause (b) above, as a result of the
appointment of a receiver or conservator with respect to such Lender at the
direction or request of any regulatory agency or authority.
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"Letter of Credit" shall mean each letter of credit issued pursuant
to Section 3.1.
"Letter of Credit Commitment" shall mean $30,000,000, as the same
may be reduced from time to time pursuant to Section 3.1.
"Letter of Credit Exposure" shall mean, with respect to any Lender,
such Lender's Revolving Credit Commitment Percentage of the Letter of Credit
Outstandings.
"Letter of Credit Fee" shall have the meaning provided in Section
4.1(b).
"Letter of Credit Issuer" shall mean Chase, any of its Affiliates
or any successor pursuant to Section 3.6.
"Letter of Credit Outstandings" shall mean, at any time, the sum
of, without duplication, (a) the aggregate Stated Amount of all outstanding
Letters of Credit and (b) the aggregate amount of all Unpaid Drawings in
respect of all Letters of Credit.
"Letter of Credit Request" shall have the meaning provided in
Section 3.2.
"Lien" shall mean any mortgage, pledge, security interest,
hypothecation, assignment, lien (statutory or other) or similar encumbrance
(including any agreement to give any of the foregoing, any conditional sale
or other title retention agreement or any lease in the nature thereof).
"Loan" shall mean any Revolving Credit Loan or Swingline Loan.
"Mandatory Borrowing" shall have the meaning provided in Section
2.1(c).
"Margin Stock" shall have the meaning provided in Regulation U.
"Material Adverse Change" shall mean any event, development or
circumstance that has had or could reasonably be expected to have a material
adverse effect on (a) the business, assets, operations or financial condition
of the Borrower and its Subsidiaries taken as a whole, (b) the ability of the
Borrower to perform its obligations under this Agreement and the other Credit
Documents taken as a whole or (c) the rights of or benefits available to the
Lenders under this Agreement and the other Credit Documents taken as a whole.
"Material Adverse Effect" shall mean a material adverse effect on
(a) the business, assets, operations or financial condition of the Borrower
and its Subsidiaries taken as a whole, (b) the ability of the Borrower to
perform its obligations under this Agreement and the other Credit Documents
taken as a whole or (c) the rights of or benefits available to the Lenders
under this Agreement and the other Credit Documents taken as a whole.
"Material Subsidiary" shall mean, at any date of determination, any
Subsidiary of the Borrower (a) whose total assets at the last day of the most
recent Test Period for which financial statements are required to have been
delivered under Section 9.1 are equal to or greater than 5% of the
consolidated total assets of the Borrower and its Subsidiaries at such date
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or (b) whose gross revenues for such Test Period were equal to or greater
than 5% of the consolidated gross revenues of the Borrower and its
Subsidiaries for such period, in each case determined in accordance with
GAAP.
"Minimum Borrowing Amount" shall mean (a) with respect to a
Borrowing of Revolving Credit Loans, $5,000,000 and (b) with respect to a
Borrowing of Swingline Loans, $100,000.
"Moody's" shall mean Moody's Investors Service, Inc. or any
successor by merger or consolidation to its business.
"Mortgage" shall mean the mortgage or deed of trust to be granted
by the record owner of the Mortgaged Property to the Administrative Agent (or
a trustee for the benefit of the Administrative Agent), granting a Lien on
the Mortgaged Property to secure the Obligations (up to a maximum amount
determined as provided in Section 6.2(c)).
"Mortgaged Property" shall mean the Specified Mortgaged Property or
any property substituted therefor as contemplated by Section 9.15(b).
"Net Proceeds" shall mean, with respect to any event (a) the cash
proceeds received in respect of such event including (i) any cash received in
respect of any noncash proceeds, but only as and when received, (ii) in the
case of a casualty, insurance proceeds, and (iii) in the case of a condemnation
or similar event, condemnation awards and similar payments, net of (b) the sum
of (i) all reasonable fees and out-of-pocket expenses paid by the Borrower
and the Subsidiaries to third parties (other than Affiliates) in connection
with such event, (ii) in the case of a sale, transfer or other disposition of
an asset (including pursuant to a sale and leaseback transaction or a
casualty or other damage or condemnation or similar proceeding), the amount
of all payments required to be made by the Borrower and the Subsidiaries as a
result of such event to repay Indebtedness (other than Loans, 9.50% Notes or
Permitted Subordinated Indebtedness) secured by such asset or otherwise
subject to mandatory prepayment as a result of such event, and (iii) the
amount of all taxes paid (or reasonably estimated to be payable) by the
Borrower and the Subsidiaries, and the amount of any reserves established by
the Borrower and the Subsidiaries to fund contingent liabilities reasonably
estimated to be payable, in each case during the year that such event
occurred or the next succeeding two years and that are directly attributable
to such event (as determined reasonably and in good faith by an Authorized
Officer).
"9.50% Notes" shall mean the 9.50% Notes Due May 1, 2005 of the
Borrower in an aggregate initial principal amount of $200,000,000.
"Non-Defaulting Lender" shall mean and include each Lender other
than a Defaulting Lender.
"Non-Excluded Taxes" shall have the meaning provided in Section
5.4(a).
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"Note Indenture" shall mean the Indenture dated as of May 1, 1995,
as the same may be amended, supplemented or otherwise modified from time to
time, between the Borrower and Chase, as trustee, pursuant to which the 9.50%
Notes were issued.
"Notice of Borrowing" shall have the meaning provided in Section
2.3.
"Notice of Conversion or Continuation" shall have the meaning
provided in Section 2.6.
"Obligations" has the meaning assigned to such term in the Security
Agreement.
"Participant" shall have the meaning provided in Section
13.6(a)(ii).
"PBGC" shall mean the Pension Benefit Guaranty Corporation
established pursuant to Section 4002 of ERISA, or any successor thereto.
"Perfection Certificate" shall mean a certificate in the form of
Exhibit G or any other form approved by the Administrative Agent.
"Perfection Date" shall mean the date on which all conditions set
forth in Section 6.2 have been satisfied.
"Perfection Date Commitments" shall mean, collectively, a portion
of the Revolving Credit Commitments equal to $10,000,000 and, with respect to
each Lender, the portion of such Lender's Revolving Credit Commitment equal
to the product of (x) such Lender's Revolving Credit Commitment Percentage
and (y) $10,000,000.
"Permitted Acquisition" shall mean the acquisition, by merger or
otherwise, by the Borrower or any of its Subsidiaries of assets or capital
stock or other equity interests, so long as (a) such acquisition and all
transactions related thereto shall be consummated in accordance with
applicable law; (b) such acquisition shall, in the case of the acquisition of
capital stock or other equity interests by the Borrower or any Subsidiary,
result in the issuer of such capital stock or other equity interests becoming
a Subsidiary and a direct Subsidiary in the case of such an acquisition by the
Borrower (except that acquisitions that do not satisfy the requirements of this
clause (b) may be consummated so long as, after giving effect to any such
acquisition, the total consideration for all such acquisitions does not exceed
5% of the Borrower's Consolidated Net Tangible Assets); (c) after giving
effect to such acquisition, no Default or Event of Default shall have occurred
and be continuing; (d) the Borrower shall be in compliance, on a pro forma
basis after giving effect to such acquisition (including any Indebtedness
assumed or permitted to exist or incurred pursuant to Sections 10.1(a)(ix)
and 10.1(a)(x), respectively), with the covenants set forth in Sections 10.8
and 10.9, as such covenants are recomputed as at the last day of the most
recently ended Test Period under such Sections as if such acquisition had
occurred on the first day of such Test Period; (e) such acquisition
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shall be of an entity engaged generally in the same or related industries as
the Borrower and its Subsidiaries (except that acquisitions that do not
satisfy the requirements of this clause (e) may be consummated so long as,
after giving effect to any such acquisition, the total consideration for all
such acquisitions does not exceed 10% of the Borrower's Consolidated Net
Tangible Assets); and (f) such acquisition has been approved in writing
by the Required Lenders.
"Permitted Collateral Liens" shall mean (i) Liens referred to in
clause (b) of the definition of "Permitted Liens" and (ii) Liens imposed by
law for taxes, assessments or other governmental charges or claims that are
not yet due.
"Permitted Holders" means, as of the date of determination, any and
all of (a) Borden and its Subsidiaries, (b) KKR, its successor and Affiliates
and (c)(i) any officer or other member of the management employed by Borden,
BCPM, the Borrower or any Subsidiary for the 12-month period prior to the
date of determination; (ii) any Persons described in clause (i) who have
retired (including as the result of disability) after the initial date of
this Agreement from the employment of Borden, BCPM, the Borrower or any
Subsidiary in the ordinary course of business; (iii) family members or
relatives of the Persons described in clauses (i) and (ii); (iv) any trusts
created for the benefit of the Persons described in clause (i), (ii), (iii)
or (v); (v) in the event of the incompetence or death of any of the Persons
described in clauses (i), (ii) and (iii), such Person's estate, executor,
administrator, committee or other personal representative, or beneficiaries,
in each case who at any particular date shall beneficially own or have the
right to acquire, directly or indirectly, Capital Stock and (vi) any Person,
the management of which is controlled by one or more Persons described in
clause (i) or (ii). The management of a Person shall be deemed to be
controlled by the chief executive officer (or equivalent executive) of such
Person.
"Permitted Investments" shall mean (a) cash and (b) domestic and
eurodollar certificates of deposit maturing no more than two years after the
date of acquisition thereof issued by any Lender.
"Permitted Liens" shall mean (a) Liens for taxes, assessments or
governmental charges or claims not yet due or which are being contested in
good faith and by appropriate proceedings for which appropriate reserves have
been established in accordance with GAAP; (b) Liens in respect of property or
assets of the Borrower or any of its Subsidiaries imposed by law, such as
carriers', warehousemen's and mechanics' Liens and other similar Liens
arising in the ordinary course of business, in each case so long as such
Liens arise in the ordinary course of business and do not individually or in
the aggregate have a material Adverse Effect; (c) Liens arising from
judgments or decrees in circumstances not constituting an Event of Default
under Section 11.7; (d) Liens incurred or deposits made in connection
with workers' compensation, unemployment insurance and other types
of social security, or to secure the performance of tenders, statutory
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obligations, surety and appeal bonds, bids, leases, government contracts,
performance and return-of-money bonds and other similar obligations incurred
in the ordinary course of business; (e) ground leases in respect of real
property on which facilities owned or leased by the Borrower or any of its
Subsidiaries are located; (f) easements, rights-of-way, restrictions, minor
defects or irregularities in title and other similar charges or encumbrances
not interfering in any material respect with the business of the Borrower and
its Subsidiaries taken as a whole; (g) any interest or title of a lessor or
secured by a lessor's interest under any lease permitted by this Agreement;
(h) Liens in favor of customs and revenue authorities arising as a matter of
law to secure payment of customs duties in connection with the importation of
goods; (i) Liens on goods the purchase price of which is financed by a
documentary letter of credit issued for the account of the Borrower or any of
its Subsidiaries, provided that such Lien secures only the obligations of the
Borrower or such Subsidiaries in respect of such letter of credit to the
extent permitted under Section 10.1; and (j) leases or subleases granted to
others not interfering in any material respect with the business of the
Borrower and its Subsidiaries, taken as a whole.
"Permitted Subordinated Indebtedness" shall mean Indebtedness for
borrowed money of the Borrower which (a) is unsecured, (b) is not guaranteed
by any Subsidiary, (c) has terms and conditions (including, without
limitation, covenants, events of default, redemption rights and other
provisions) customary for publicly issued subordinated debt securities of
comparable credit quality at the time of issuance, (d) matures after, and
does not require any scheduled repayment of principal prior to, the date that
is one year after the Revolving Credit Maturity Date, (e) shall contain or
have applicable thereto subordination provisions that the Borrower and the
Administrative Agent reasonably agree to be customary for publicly issued
subordinated debt securities at the time of issuance (except that such
Indebtedness shall only be subordinated to the Obligations) and (f) provides
for the payment of any interest in kind and not in cash.
"Person" shall mean any individual, partnership, joint venture, firm,
corporation, limited company, association, trust or other enterprise or any
Governmental Authority.
"Plan" shall mean any multiemployer or single-employer plan, as
defined in Section 4001 of ERISA and subject to Title IV of ERISA, that is or
was within any of the preceding five plan years maintained or contributed to
by (or to which there is or was an obligation to contribute or to make
payments of) the Borrower, a Subsidiary or an ERISA Affiliate.
"Preferred Stock", as applied to the Capital Stock of any Person,
shall mean Capital Stock of any class or classes (however designated) which
is preferred as to the payment of dividends, or as to the distribution of
assets upon any voluntary or involuntary liquidation or dissolution of such
Person, over the Capital Stock of any other class of such Person.
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"Prepayment Event" means:
(a) any direct or indirect sale, transfer or other disposition
(including pursuant to a sale and leaseback transaction) of any property
or asset of the Borrower or any Subsidiary (other than sales, transfers
and other dispositions of (i) inventory, vehicles and used or surplus
equipment, in each case in the ordinary course of business, or (ii)
other assets in the ordinary course of business, it being understood
that any sale, transfer or other disposition of other assets with an
aggregate fair market value exceeding $750,000 shall not be considered
to be in the ordinary course of business); or
(b) any casualty or other insured damage to, or any taking under
power of eminent domain or by condemnation or similar proceeding of, any
property or asset of the Borrower or any Subsidiary;
provided that any such event referred to in clause (b) above shall not
constitute a "Prepayment Event" if the Borrower elects (by notice to the
Administrative Agent within two Business Days after receipt of the Net
Proceeds of such event) to apply the Net Proceeds of such event to repair,
restore or replace the affected property or asset or to reinvest such Net
Proceeds in other assets to be used in the same line of business of the type
conducted by the Borrower and its Subsidiaries on the Closing Date, or enters
into agreements committing such Net Proceeds to be so applied, as promptly as
practicable, but in any event within 360 days, after the receipt of the Net
Proceeds of such event; provided further that, if at the expiration of such
360-day period less than all the Net Proceeds of such event have been
reinvested or applied or so committed to be applied, then a "Prepayment
Event" shall be deemed to have occurred at the expiration of such 360-day
period with Net Proceeds equal to the Net Proceeds that have not been so
reinvested or applied or so committed to be applied.
"Prime Rate" shall mean the rate of interest per annum publicly
announced from time to time by the Administrative Agent as its reference rate
in effect at its principal office in New York City (the Prime Rate not being
intended to be the lowest rate of interest charged by Chase in connection
with extensions of credit to debtors).
"Redeemable Stock" shall mean any Capital Stock that by its terms
or otherwise is required to be redeemed prior to the first anniversary of the
Revolving Credit Maturity Date or is redeemable at the option of the holder
thereof (upon the occurrence of any contingency or otherwise) at any time
prior to the first anniversary of the Revolving Credit Maturity Date.
"Reference Lender" shall mean Chase.
"Register" shall have the meaning provided in Section 13.6(c).
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"Regulation D" shall mean Regulation D of the Board as from time to
time in effect and any successor to all or a portion thereof establishing
reserve requirements.
"Regulation G" shall mean Regulation G of the Board as from time to
time in effect and any successor to all or a portion thereof establishing
margin requirements.
"Regulation T" shall mean Regulation T of the Board as from time to
time in effect and any successor to all or a portion thereof establishing
margin requirements.
"Regulation U" shall mean Regulation U of the Board as from time to
time in effect and any successor to all or a portion thereof establishing
margin requirements.
"Regulation X" shall mean Regulation X of the Board as from time to
time in effect and any successor to all or a portion thereof establishing
margin requirements.
"Reportable Event" shall mean an event described in Section 4043 of
ERISA and the regulations thereunder.
"Required Lenders" shall mean, at any date, (a) Non-Defaulting
Lenders having a majority of the Adjusted Total Revolving Credit Commitment
at such date or (b) if the Total Revolving Credit Commitment has been
terminated or for the purposes of acceleration pursuant to Section 11, the
holders (excluding Defaulting Lenders) of a majority of the outstanding
principal amount of the Loans and Letter of Credit Exposures (excluding the
Loans and Letter of Credit Exposures of Defaulting Lenders) in the aggregate
at such date.
"Requirement of Law" shall mean, as to any Person, the Certificate
of Incorporation and By-Laws or other organizational or governing documents
of such Person, and any law, treaty, rule or regulation or determination of
an arbitrator or a court or other Governmental Authority, in each case
applicable to or binding upon such Person or any of its property or assets or
to which such Person or any of its property or assets is subject.
"Revolving Credit Commitment" shall mean, (a) with respect to each
Lender that is a Lender on the date hereof, the amount set forth opposite
such Lender's name on Schedule 1.1 as such Lender's "Revolving Credit
Commitment" and (b) in the case of any Lender that becomes a Lender after the
date hereof, the amount specified as such Lender's "Revolving Credit
Commitment" in the Assignment and Acceptance pursuant to which such Lender
assumed a portion of the Total Revolving Credit Commitment, in each case as
the same may be changed from time to time pursuant to the terms hereof.
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"Revolving Credit Commitment Percentage" shall mean at any time,
for each Lender, the percentage obtained by dividing such Lender's Revolving
Credit Commitment by the Total Revolving Credit Commitment, provided that at
any time when the Total Revolving Credit Commitment shall have been
terminated, each Lender's Revolving Credit Commitment Percentage shall be its
Revolving Credit Commitment Percentage as in effect immediately prior to such
termination.
"Revolving Credit Loan" shall have the meaning provided in Section
2.1.
"Revolving Credit Maturity Date" shall mean December 31, 2000.
"S&P" shall mean Standard & Poor's Ratings Service or any successor
by merger or consolidation to its business.
"SEC" shall mean the Securities and Exchange Commission or any
successor thereto.
"Security Agreement" shall mean the Security Agreement,
substantially in the form of Exhibit H, among the Borrower, the Subsidiaries
and the Administrative Agent.
"Security Documents" shall mean the Security Agreement and the
Mortgage.
"Secured Parties" is defined in the Security Agreement.
"Section 9.1 Financials" shall mean the financial statements
delivered, or required to be delivered, pursuant to Section 9.1(a) or (b)
together with the accompanying officer's certificate delivered, or required
to be delivered, pursuant to Section 9.1(c).
"Senior Debt Ratio" shall mean, as of any date of determination,
the ratio of (a) Consolidated Senior Debt as of the last day of the most
recent Test Period ended on or prior to such date to (b) EBITDA for such Test
Period.
"Specified Mortgaged Property" shall mean the Borrower's co-
generation facility located at Geismar, Louisiana.
"Stated Amount" of any Letter of Credit shall mean the maximum
amount from time to time available to be drawn thereunder, determined without
regard to whether any conditions to drawing could then be met.
"Subsidiary" of any Person shall mean and include (a) any
corporation more than 50% of whose stock of any class or classes having by
the terms thereof ordinary voting power to elect a majority of the directors
of such corporation (irrespective of whether or not at the time stock of any
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class or classes of such corporation shall have or might have voting power by
reason of the happening of any contingency) is at the time owned by such
Person directly or indirectly through Subsidiaries and (b) any partnership,
association, joint venture or other entity in which such Person directly or
indirectly through Subsidiaries has more than a 50% equity interest at the
time. Unless otherwise expressly provided, all references herein to a
"Subsidiary" shall mean a Subsidiary of the Borrower.
"Subsidiary Guarantor" shall mean any Subsidiary of the Borrower
that shall have executed and delivered to the Administrative Agent a
guarantee agreement, reasonably satisfactory in form and substance to the
Administrative Agent, pursuant to which such Subsidiary shall have
unconditionally guaranteed the payment by the Borrower as and when due of all
principal, interest and other amounts payable by the Borrower under this
Agreement.
"Swingline Commitment" shall mean $10,000,000.
"Swingline Loans" shall have the meaning provided in Section
2.1(b).
"Swingline Maturity Date" shall mean, with respect to any Swingline
Loan, the date that is five Business Days prior to the Revolving Credit
Maturity Date.
"Test Period" shall mean, for any determination under this
Agreement, the four consecutive fiscal quarters of the Borrower then last
ended.
"Three-Month Secondary CD Rate" shall mean, for any day, the
secondary market rate, expressed as a per annum rate, for three-month
certificates of deposit reported as being in effect on such day (or, if such
day shall not be a Business Day, the next preceding Business Day) by the
Board through the public information telephone line of the Federal Reserve
Bank of New York (which rate will, under the current practices of the Board,
be published in Federal Reserve Statistical Release H.15(519) during the week
following such day), or, if such rate shall not be so reported on such day or
such next preceding Business Day, the average of the secondary market
quotations for three-month certificates of deposit of major money center
banks in New York City received at approximately 10:00 A.M., New York time,
on such day (or, if such day shall not be a Business Day, on the next
preceding Business Day) by the Administrative Agent from three New York City
negotiable certificate of deposit dealers of recognized standing selected by
it.
"Total Revolving Credit Commitment" shall mean the sum of the
Revolving Credit Commitments of all the Lenders.
"Transferee" shall have the meaning provided in Section 13.6(e).
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"Type" shall mean, as to any Revolving Credit Loan, its nature as
an ABR Loan or a Eurodollar Loan.
"Unfunded Current Liability" of any Plan shall mean the amount, if
any, by which the present value of the accrued benefits under the Plan as of
the close of its most recent plan year, determined in accordance with
Statement of Financial Accounting Standards No. 87 as in effect on the date
hereof, based upon the actuarial assumptions that would be used by the Plan's
actuary in a termination of the Plan, exceeds the fair market value of the
assets allocable thereto.
"Unpaid Drawing" shall have the meaning provided in Section 3.4(a).
"Voting Stock" shall mean, with respect to any Person, shares of
such Person's capital stock having the right to vote for the election of
directors of such Person under ordinary circumstances.
SECTION 2. Amount and Terms of Credit.
2.1 Commitments. (a) Subject to and upon the terms and
conditions herein set forth, each Lender severally agrees to make a loan or
loans (each a "Revolving Credit Loan" and, collectively, the "Revolving
Credit Loans") to the Borrower, which Revolving Credit Loans (i) shall be
made at any time and from time to time on and after the Closing Date and
prior to the Revolving Credit Maturity Date, (ii) may, at the option of the
Borrower, be incurred and maintained as, and/or converted into, ABR Loans or
Eurodollar Loans, provided that all Revolving Credit Loans made by each of
the Lenders pursuant to the same Borrowing shall, unless otherwise
specifically provided herein, consist entirely of Revolving Credit Loans of
the same Type, (iii) may be repaid and reborrowed in accordance with the
provisions hereof, (iv) shall not exceed for any such Lender at any time
outstanding that aggregate principal amount which, when added to the product
of (x) such Lender's Revolving Credit Commitment Percentage and (y) the sum
of (I) the aggregate Letter of Credit Outstandings at such time and (II) the
aggregate principal amount of all Swingline Loans then outstanding, equals
(A) prior to the Perfection Date, the excess of the Revolving Credit
Commitment of such Lender at such time minus such Lender's Perfection Date
Commitment or (B) on and after the Perfection Date, the Revolving Credit
Commitment of such Lender at such time and (v) shall not, after giving effect
thereto and to the application of the proceeds thereof, exceed for all
Lenders at any time outstanding the aggregate principal amount that, when
added to the sum of (x) the Letter of Credit Outstandings at such time and
(y) the aggregate principal amount of all Swingline Loans then outstanding,
equals (A) prior to the Perfection Date, the excess of the Total Revolving
Credit Commitment then in effect minus the Perfection Date Commitments or (B)
on and after the Perfection Date, the Total Revolving Credit Commitment then
in effect. On the Revolving Credit Maturity Date, all Revolving Credit Loans
shall be repaid in full.
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(b) Subject to and upon the terms and conditions herein set forth,
Chase in its individual capacity agrees, at any time and from time to time on
and after the Closing Date and prior to the Swingline Maturity Date, to make
a loan or loans (each a "Swingline Loan" and, collectively, the "Swingline
Loans") to the Borrower, which Swingline Loans (i) shall be ABR Loans, (ii)
shall have the benefit of the provisions of Section 2.1(c), (iii) shall not
exceed at any time outstanding the Swingline Commitment, (iv) shall not,
after giving effect thereto and to the application of the proceeds thereof,
exceed in the aggregate at any time outstanding the principal amount that,
when added to the aggregate principal amount of all Revolving Credit Loans
then outstanding and all Letter of Credit Outstandings at such time, equals
(A) prior to the Perfection Date, the excess of the Total Revolving Credit
Commitment then in effect minus the Perfection Date Commitments or (B) on and
after the Perfection Date, the Total Revolving Credit Commitment then in
effect and (v) may be repaid and reborrowed in accordance with the provisions
hereof. Each Swingline Loan shall be repaid in full on the earlier of the
Swingline Maturity Date and the first date after such Swingline Loan is made
that is the 15th or last day of a calendar month and is at least two Business
Days after such Swingline Loan is made; provided that on each date that a
Borrowing of Revolving Credit Loans is made, the Borrower shall repay all
Swingline Loans then outstanding. Chase shall not make any Swingline Loan
after receiving a written notice from the Borrower or any Lender stating that
a Default or Event of Default exists and is continuing until such time as
Chase shall have received written notice of (i) rescission of all such
notices from the party or parties originally delivering such notice, or (ii)
the waiver of such Default or Event of Default in accordance with the
provisions of Section 13.1.
(c) On any Business Day, Chase may, in its sole discretion, give
notice to the Lenders that all then-outstanding Swingline Loans shall be
funded with a Borrowing of Revolving Credit Loans, in which case a Borrowing
of Revolving Credit Loans constituting ABR Loans (each such Borrowing, a
"Mandatory Borrowing") shall be made on the immediately succeeding Business
Day by all Lenders pro rata based on each Lender's Revolving Credit
Commitment Percentage, and the proceeds thereof shall be applied directly to
Chase to repay Chase for such outstanding Swingline Loans. Each Lender hereby
irrevocably agrees to make such Revolving Credit Loans upon one Business
Day's notice pursuant to each Mandatory Borrowing in the amount and in the
manner specified in the preceding sentence and on the date specified to it in
writing by Chase notwithstanding (i) that the amount of the Mandatory
Borrowing may not comply with the minimum amount for each Borrowing specified
in Section 2.2, (ii) whether any conditions specified in Section 7 are then
satisfied, (iii) whether a Default or an Event of Default has occurred and is
continuing, (iv) the date of such Mandatory Borrowing or (v) any reduction in
the Total Revolving Credit Commitment after any such Swingline Loans were
made. In the event that, in the sole judgment of Chase, any Mandatory
Borrowing cannot for any reason be made on the date otherwise required above
(including, without limitation, as a result of the commencement of a
proceeding under the Bankruptcy Code in respect of the Borrower), each Lender
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hereby agrees that it shall forthwith purchase from Chase (without recourse
or warranty) such participation of the outstanding Swingline Loans as shall
be necessary to cause the Lenders to share in such Swingline Loans ratably
based upon their respective Revolving Credit Commitment Percentages, provided
that all principal and interest payable on such Swingline Loans shall be for
the account of Chase until the date the respective participation is purchased
and, to the extent attributable to the purchased participation, shall be
payable to the Lender purchasing same from and after such date of purchase.
2.2 Minimum Amount of Each Borrowing; Maximum Number of
Borrowings. The aggregate principal amount of each Borrowing of Revolving
Credit Loans shall be in a multiple of $1,000,000 and Swingline Loans shall
be in a multiple of $100,000, and no Borrowing of Loans shall be less than
the minimum Borrowing Amount with respect thereto (except that mandatory
Borrowings shall be made in the amounts required by Section 2.1(c)). More
than one Borrowing may be incurred on any date, provided that at no time
shall there be outstanding more than 8 Borrowings of Eurodollar Loans under
this Agreement.
2.3 Notice of Borrowing. (a) Whenever the Borrower desires to
incur Revolving Credit Loans hereunder (other than Mandatory Borrowings or
borrowings to repay Unpaid Drawings), it shall give the Administrative Agent
at the Administrative Agent's Office (i) prior to 12:00 Noon (New York time)
at least three Business Days' prior written notice (or telephonic notice
promptly confirmed in writing) of each Borrowing of Eurodollar Loans and (ii)
prior to 12:00 Noon (New York time) at least one Business Day's prior written
notice (or telephonic notice promptly confirmed in writing) of each Borrowing
of ABR Loans. Each such notice (a "Notice of Borrowing"), except as otherwise
expressly provided in Section 2.10, shall be irrevocable and shall specify
(i) the aggregate principal amount of the Revolving Credit Loans to be made
pursuant to such Borrowing, (ii) the date of Borrowing (which shall be a
Business Day) and (iii) whether the respective Borrowing shall consist of ABR
Loans or Eurodollar Loans and, if Eurodollar Loans, the Interest Period to be
initially applicable thereto. The Administrative Agent shall promptly give
each Lender written notice (or telephonic notice promptly confirmed in
writing) of each proposed Borrowing of Revolving Credit Loans, of such
Lender's proportionate share thereof and of the other matters covered by the
related Notice of Borrowing.
(b) Whenever the Borrower desires to incur Swingline Loans
hereunder, it shall give the Administrative Agent written notice (or
telephonic notice promptly confirmed in writing) of each Borrowing of
Swingline Loans prior to 1:00 P.M. (New York time) on the date of such
Borrowing. Each such notice shall be irrevocable and shall specify (i) the
aggregate principal amount of the Swingline Loans to be made pursuant to such
Borrowing and (ii) the date of Borrowing (which shall be a Business Day). The
Administrative Agent shall promptly give Chase written notice (or telephonic
notice promptly confirmed in writing) of each proposed Borrowing of Swingline
Loans and of the other matters covered by the related Notice of Borrowing.
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(c) Mandatory Borrowings shall be made upon the notice specified
in Section 2.1(c), with the Borrower irrevocably agreeing, by its incurrence
of any Swingline Loan, to the making of Mandatory Borrowings as set forth in
such Section.
(d) Borrowings to reimburse Unpaid Drawings shall be made upon the
notice specified in Section 3.4(c).
(e) Without in any way limiting the obligation of the Borrower to
confirm in writing any notice it may give hereunder by telephone, the
Administrative Agent may act prior to receipt of written confirmation without
liability upon the basis of such telephonic notice believed by the
Administrative Agent in good faith to be from an Authorized Officer of the
Borrower. In each such case the Borrower hereby waives the right to dispute
the Administrative Agent's record of the terms of any such telephonic notice.
2.4 Disbursement of Funds. (a) No later than 12:00 Noon (New
York time) on the date specified in each Notice of Borrowing (including
Mandatory Borrowings), each Lender will make available its pro rata portion,
if any, of each Borrowing requested to be made on such date in the manner
provided below, provided that all Swingline Loans shall be made available in
the full amount thereof by Chase no later than 2:00 P.M. (New York time) on
the date requested.
(b) Each Lender shall make available all amounts it is to fund
under any Borrowing in Dollars and immediately available funds to the
Administrative Agent at the Administrative Agent's office and the
Administrative Agent will (except in the case of Mandatory Borrowings and
Borrowings to repay Unpaid Drawings) make available to the Borrower by
depositing to the Borrower's account at the Administrative Agent's office the
aggregate of the amounts so made available in Dollars and the type of funds
received. Unless the Administrative Agent shall have been notified by any
Lender prior to the date of any such Borrowing that such Lender does not
intend to make available to the Administrative Agent its portion of the
Borrowing or Borrowings to be made on such date, the Administrative Agent may
assume that such Lender has made such amount available to the Administrative
Agent on such date of Borrowing, and the Administrative Agent, in reliance
upon such assumption, may (in its sole discretion and without any obligation
to do so) make available to the Borrower a corresponding amount. If such
corresponding amount is not in fact made available to the Administrative
Agent by such Lender and the Administrative Agent has made available same to
the Borrower, the Administrative Agent shall be entitled to recover such
corresponding amount from such Lender. If such Lender does not pay such
corresponding amount forthwith upon the Administrative Agent's demand
therefor, the Administrative Agent shall promptly notify the Borrower, and
the Borrower shall immediately pay such corresponding amount to the
Administrative Agent. The Administrative Agent shall also be entitled to
recover from such Lender or the Borrower, as the case may be, interest on
such corresponding amount in respect of each day from the date such
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corresponding amount was made available by the Administrative Agent to the
Borrower to the date such corresponding amount is recovered by the
Administrative Agent, at a rate per annum equal to (i) if paid by such Lender,
the Federal Funds Effective Rate or (ii) if paid by the Borrower, the
then-applicable rate of interest, calculated in accordance with Section 2.8,
for the respective Loans.
(c) Nothing in this Section 2.4 shall be deemed to relieve any
Lender from its obligation to fulfill its commitments hereunder or to
prejudice any rights that the Borrower may have against any Lender as a
result of any default by such Lender hereunder (it being understood, however,
that no Lender shall be responsible for the failure of any other Lender to
fulfill its commitments hereunder).
2.5 Repayment of Loans; Evidence of Debt. (a) The Borrower shall
repay to the Administrative Agent, for the benefit of the Lenders, on the
Revolving Credit Maturity Date, the then-unpaid Revolving Credit Loans. The
Borrower shall repay to the Administrative Agent, for the account of Chase,
on the Swingline Maturity Date, the then unpaid Swingline Loans. The Borrower
also shall repay Swingline Loans as required by Section 2.1(b).
(b) Each Lender shall maintain in accordance with its usual
practice an account or accounts evidencing the indebtedness of the Borrower
to the appropriate lending office of such Lender resulting from each Loan
made by such lending office of such Lender from time to time, including the
amounts of principal and interest payable and paid to such lending office of
such Lender from time to time under this Agreement.
(c) The Administrative Agent shall maintain the Register pursuant
to Section 13.6, and a subaccount for each Lender, in which Register and
subaccounts (taken together) shall be recorded (i) the amount of each Loan
made hereunder, whether such Loan is a Revolving Credit Loan or a Swingline
Loan, the Type of each Loan made and the Interest Period applicable thereto,
(ii) the amount of any principal or interest due and payable or to become due
and payable from the Borrower to each Lender or Chase hereunder, and (iii)
the amount of any sum received by the Administrative Agent hereunder from the
Borrower and each Lender's share thereof.
(d) The entries made in the Register and accounts and subaccounts
maintained pursuant to paragraphs (b) and (c) of this Section 2.5 shall, to
the extent permitted by applicable law, be prima facie evidence of the
existence and amounts of the obligations of the Borrower therein recorded;
provided, however, that the failure of any Lender or the Administrative Agent
to maintain such account, such Register or such subaccount, as applicable, or
any error therein, shall not in any manner affect the obligation of the
Borrower to repay (with applicable interest) the Loans made to the Borrower
by such Lender in accordance with the terms of this Agreement.
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2.6 Conversions and Continuations. (a) The Borrower shall have
the option on any Business Day to convert all or a portion equal to at least
the Minimum Borrowing Amount of the outstanding principal amount of Revolving
Credit Loans of one Type into a Borrowing or Borrowings of another Type or to
continue the outstanding principal amount of any Eurodollar Loans as
Eurodollar Loans for an additional Interest Period, provided that (i) no
partial conversion of Eurodollar Loans shall reduce the outstanding principal
amount of Eurodollar Loans made pursuant to a single Borrowing to less than
the minimum Borrowing Amount, (ii) ABR Loans may not be converted into
Eurodollar Loans if a Default or Event of Default is in existence on the date
of the conversion and the Administrative Agent has or the Required Lenders
have determined in its or their sole discretion not to permit such
conversion, (iii) Eurodollar Loans may not be continued as Eurodollar Loans
for an additional Interest Period if a Default or Event of Default is in
existence on the date of the proposed continuation and the Administrative
Agent has or the Required Lenders have determined in its or their sole
discretion not to permit such continuation and (iv) Borrowings resulting from
conversions pursuant to this Section 2.6 shall be limited in number as
provided in Section 2.2. Each such conversion or continuation shall be
effected by the Borrower by giving the Administrative Agent at the
Administrative Agent's office prior to 12:00 Noon (New York time) at least
three Business Days' (or one Business Day's notice in the case of a
conversion into ABR Loans) prior written notice (or telephonic notice
promptly confirmed in writing) (each a "Notice of Conversion or
Continuation") specifying the Revolving Credit Loans to be so converted or
continued, the Type of Revolving Credit Loans to be converted or continued
into and, if such Revolving Credit Loans are to be converted into or
continued as Eurodollar Loans, the Interest Period to be initially applicable
thereto. The Administrative Agent shall give each Lender notice as promptly
as practicable of any such proposed conversion or continuation.
(b) If any Default or Event of Default is in existence at the time
of any proposed continuation of any Eurodollar Loans and the Administrative
Agent has or the Required Lenders have determined in its or their sole
discretion not to permit such continuation, such Eurodollar Loans shall be
automatically converted on the last day of the current Interest Period into
ABR Loans. If upon the expiration of any Interest Period in respect of
Eurodollar Loans, the Borrower has failed to elect a new Interest Period to
be applicable thereto as provided in paragraph (a) above, the Borrower shall
be deemed to have elected to convert such Borrowing of Eurodollar Loans into
a Borrowing of ABR Loans effective as of the expiration date of such current
Interest Period.
2.7 Pro Rata Borrowings. Each Borrowing of Revolving Credit Loans
under this Agreement shall be granted by the Lenders pro rata on the basis of
their then-applicable Revolving Credit Commitments. It is understood that no
Lender shall be responsible for any default by any other Lender in its
obligation to make Loans hereunder and that each Lender shall be obligated to
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make the Loans provided to be made by it hereunder, regardless of the failure
of any other Lender to fulfill its commitments hereunder.
2.8 Interest. (a) The unpaid principal amount of each ABR Loan
shall bear interest from the date of the Borrowing thereof until maturity
(whether by acceleration or otherwise) at a rate per annum that shall at all
times be the Applicable Margin in effect from time to time plus the ABR in
effect from time to time.
(b) The unpaid principal amount of each Eurodollar Loan shall bear
interest from the date of the Borrowing thereof until maturity thereof
(whether by acceleration or otherwise) at a rate per annum that shall at all
times be the Applicable Margin in effect from time to time plus the relevant
Eurodollar Rate.
(c) If all or a portion of (i) the principal amount of any Loan or
(ii) any interest payable thereon shall not be paid when due (whether at the
stated maturity, by acceleration or otherwise), such overdue amount shall
bear interest at a rate per annum that is (x) in the case of overdue
principal, the rate that would otherwise be applicable thereto plus 2% or (y)
in the case of any overdue interest, to the extent permitted by applicable
law, ABR plus the Applicable margin applicable to ABR Loans plus 2% from and
including the date of such non-payment to but excluding the date on which
such amount is paid in full (after as well as before judgment).
(d) Interest on each Loan shall accrue from and including the date
of any Borrowing to but excluding the date of any repayment thereof and shall
be payable (i) in respect of each ABR Loan, monthly in arrears on the last
day of each month, (ii) in respect of each Eurodollar Loan, on the last day
of each Interest Period applicable thereto and, in the case of an Interest
Period in excess of one month, on each date occurring at one-month intervals
after the first day of such Interest Period, and (iii) in respect of each
Loan (except, in the case of prepayments, any ABR Loan), on any prepayment
(on the amount prepaid), at maturity (whether by acceleration or otherwise)
and, after such maturity, on demand.
(e) All computations of interest hereunder shall be made in
accordance with Section 5.5.
(f) The Administrative Agent, upon determining the interest rate
for any Borrowing of Eurodollar Loans, shall promptly notify the Borrower and
the Lenders thereof. Each such determination shall, absent clearly
demonstrable error, be final and conclusive and binding on all parties
hereto.
2.9 Interest Periods. At the time the Borrower gives a Notice of
Borrowing or Notice of Conversion or Continuation in respect of the making
of, or conversion into or continuation as, a Borrowing of Eurodollar Loans
(in the case of the initial Interest Period applicable thereto) or prior to
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10:00 A.M. (New York time) on the third Business Day prior to the expiration
of an Interest Period applicable to a Borrowing of Eurodollar Loans, the
Borrower shall have the right to elect by giving the Administrative Agent
written notice (or telephonic notice promptly confirmed in writing) the
Interest Period applicable to such Borrowing, which Interest Period shall, at
the option of the Borrower, be a one, two, three, six or (if available to all
the Lenders making such Loans as determined by such Lenders in good faith
based on prevailing market conditions) a nine or twelve month period.
Notwithstanding anything to the contrary contained above:
(a) the initial Interest Period for any Borrowing of Eurodollar
Loans shall commence on the date of such Borrowing (including the date
of any conversion from a Borrowing of ABR Loans) and each Interest
Period occurring thereafter in respect of such Borrowing shall commence
on the day on which the next preceding Interest Period expires;
(b) if any Interest Period relating to a Borrowing of Eurodollar
Loans begins on the last Business Day of a calendar month or begins on a
day for which there is no numerically corresponding day in the calendar
month at the end of such Interest Period, such Interest Period shall end
on the last Business Day of the calendar month at the end of such
Interest Period;
(c) if any Interest Period would otherwise expire on a day that is
not a Business Day, such Interest Period shall expire on the next
succeeding Business Day, provided that if any Interest Period in respect
of a Eurodollar Loan would otherwise expire on a day that is not a
Business Day but is a day of the month after which no further Business
Day occurs in such month, such Interest Period shall expire on the next
preceding Business Day; and
(d) the Borrower shall not be entitled to elect any Interest
Period in respect of any Eurodollar Loan if such Interest Period would
extend beyond the Revolving Credit Maturity Date.
2.10 Increased Costs, Illegality, etc. (a) In the event that (x)
in the case of clause (i) below, the Administrative Agent or (y) in the case
of clauses (ii) and (iii) below, any Lender shall have reasonably determined
(which determination shall, absent clearly demonstrable error, be final and
conclusive and binding upon all parties hereto):
(i) on any date for determining the Eurodollar Rate for any
Interest Period that, by reason of any changes arising on or after
the Closing Date affecting the interbank Eurodollar market,
adequate and fair means do not exist for ascertaining the
applicable interest rate on the basis provided for in the
definition of Eurodollar Rate; or
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(ii) at any time, that such Lender shall incur increased costs
or reductions in the amounts received or receivable hereunder with
respect to any Eurodollar Loans (other than any such increase or
reduction attributable to taxes) because of (x) any change since
the date hereof in any applicable law, governmental rule,
regulation, guideline or order (or in the interpretation or
administration thereof and including the introduction of any new
law or governmental rule, regulation, guideline or order), such as,
for example, but not limited to, a change in official reserve
requirements, and/or (y) other circumstances affecting the
interbank Eurodollar market or the position of such Lender in such
market; or
(iii) at any time, that the making or continuance of any
Eurodollar Loan has become unlawful by compliance by such Lender in
good faith with any law, governmental rule, regulation, guideline
or order (or would conflict with any such governmental rule,
regulation, guideline or order not having the force of law even
though the failure to comply therewith would not be unlawful), or
has become impracticable as a result of a contingency occurring
after the date hereof that materially and adversely affects the
interbank Eurodollar market;
then, and in any such event, such Lender (or the Administrative Agent, in the
case of clause (i) above) shall within a reasonable time thereafter give
notice (if by telephone confirmed in writing) to the Borrower and to the
Administrative Agent of such determination (which notice the Administrative
Agent shall promptly transmit to each of the other Lenders). Thereafter (x)
in the case of clause (i) above, Eurodollar Loans shall no longer be
available until such time as the Administrative Agent notifies the Borrower
and the Lenders that the circumstances giving rise to such notice by the
Administrative Agent no longer exist (which notice the Administrative Agent
agrees to give at such time when such circumstances no longer exist), and any
Notice of Borrowing or Notice of Conversion given by the Borrower with
respect to Eurodollar Loans that have not yet been incurred shall be deemed
rescinded by the Borrower, (y) in the case of clause (ii) above, the Borrower
shall pay to such Lender, promptly after receipt of written demand therefor,
such additional amounts (in the form of an increased rate of, or a different
method of calculating, interest or otherwise as such Lender in its reasonable
discretion shall determine) as shall be required to compensate such Lender
for such increased costs or reductions in amounts receivable hereunder (it
being agreed that a written notice as to the additional amounts owed to such
Lender, showing in reasonable detail the basis for the catted to the Borrower
by such Lender shall, absent clearly demonstrable error, be final and
conclusive and binding upon all parties hereto) and (z) in the case of clause
(iii) above, the Borrower shall take one of the actions specified in Section
2.10(b) as promptly as possible and, in any event, within the time period
required by law.
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(b) At any time that any Eurodollar Loan is affected by the
circumstances described in Section 2.10(a)(ii) or (iii), the Borrower may
(and in the case of a Eurodollar Loan affected pursuant to Section
2.10(a)(iii) shall) either (i) if the affected Eurodollar Loan is then being
made pursuant to a Borrowing, cancel said Borrowing by giving the
Administrative Agent telephonic notice (confirmed promptly in writing)
thereof on the same date that the Borrower was notified by a Lender pursuant
to Section 2.10(a)(ii) or (iii) or (ii) if the affected Eurodollar Loan is
then outstanding, upon at least three Business Days, notice to the
Administrative Agent, require the affected Lender to convert each such
Eurodollar Loan into an ABR Loan, provided that if more than one Lender is
affected at any time, then all affected Lenders must be treated in the same
manner pursuant to this Section 2.10(b).
(c) If, after the date hereof, the adoption of any applicable law,
rule or regulation regarding capital adequacy, or any change therein, or any
change in the interpretation or administration thereof by any governmental
authority, the National Association of Insurance Commissioners, central bank
or comparable agency charged with the interpretation or administration
thereof, or compliance by a Lender or its parent with any request or
directive made or adopted after the date hereof regarding capital adequacy
(whether or not having the force of law) of any such authority, association,
central bank or comparable agency, has or would have the effect of reducing
the rate of return on such Lender's or its parent's capital or assets as a
consequence of such Lender's commitments or obligations hereunder to a level
below that which such Lender or its parent could have achieved but for such
adoption, effectiveness, change or compliance (taking into consideration such
Lender's or its parent's policies with respect to capital adequacy), then
from time to time, promptly after demand by such Lender (with a copy to the
Administrative Agent), the Borrower shall pay to such Lender such additional
amount or amounts as will compensate such Lender or its parent for such
reduction, it being understood and agreed, however, that a Lender shall not
be entitled to such compensation as a result of such Lender's compliance
with, or pursuant to any request or directive to comply with, any such law,
rule or regulation as in effect on the date hereof. Each Lender, upon
determining in good faith that any additional amounts will be payable
pursuant to this Section 2.10(c), will give prompt written notice thereof to
the Borrower, which notice shall set forth in reasonable detail the basis of
the calculation of such additional amounts, although the failure to give any
such notice shall not, subject to Section 2.13, release or diminish any of
the Borrower's obligations to pay additional amounts pursuant to this Section
2.10(c) upon receipt of such notice.
2.11 Compensation. If (a) any payment of principal of any
Eurodollar Loan is made by the Borrower to or for the account of a Lender
other than on the last day of the Interest Period for such Eurodollar Loan as
a result of a payment or conversion pursuant to Section 2.5, 2.6, 2.10, 5.1,
5.2 or 13.7, as a result of acceleration of the maturity of the Loans
pursuant to Section 11 or for any other reason, (b) any Borrowing of
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Eurodollar Loans is not made as a result of a withdrawn Notice of Borrowing,
(c) any ABR Loan is not converted into a Eurodollar Loan as a result of a
withdrawn Notice of Conversion or Continuation, (d) any Eurodollar Loan is
not continued as a Eurodollar Loan as a result of a withdrawn Notice of
Conversion or Continuation or (e) any prepayment of principal of any
Eurodollar Loan is not made as a result of a withdrawn notice of prepayment
pursuant to Section 5.1 or 5.2, the Borrower shall, after receipt of a
written request by such Lender (which request shall set forth in reasonable
detail the basis for requesting such amount), pay to the Administrative Agent
for the account of such Lender any amounts required to compensate such Lender
for any additional losses, costs or expenses that such Lender may reasonably
incur as a result of such payment, failure to convert, failure to continue or
failure to prepay, including, without limitation, any loss, cost or expense
(excluding loss of anticipated profits) actually incurred by reason of the
liquidation or reemployment of deposits or other funds acquired by any Lender
to fund or maintain such Eurodollar Loan.
2.12 Change of Lending office. Each Lender agrees that, upon the
occurrence of any event giving rise to the operation of Section 2.10(a)(ii),
2.10(a)(iii), 2.10(b), 3.5 or 5.4 with respect to such Lender, it will, if
requested by the Borrower, use reasonable efforts (subject to overall policy
considerations of such Lender) to designate another lending office for any
Loans affected by such event, provided that such designation is made on such
terms that such Lender and its lending office suffer no economic, legal or
regulatory disadvantage, with the object of avoiding the consequence of the
event giving rise to the operation of any such Section. Nothing in this
Section 2.12 shall affect or postpone any of the obligations of the Borrower
or the right of any Lender provided in Section 2.10, 3.5 or 5.4.
2.13 Notice of Certain Costs. Notwithstanding anything in this
Agreement to the contrary, to the extent any notice required by Section 2.10,
2.11, 3.5 or 5.4 is given by any Lender more than 180 days after such Lender
has knowledge (or should have had knowledge) of the occurrence of the event
giving rise to the additional cost, reduction in amounts, loss, tax or other
additional amounts described in such Sections, such Lender shall not be
entitled to compensation under Section 2.10, 2.11, 3.5 or 5.4, as the case
may be, for any such amounts incurred or accruing prior to the giving of such
notice to the Borrower.
SECTION 3. Letters of Credit.
3.1 Letters of Credit. (a) Subject to and upon the terms and
conditions herein set forth, the Borrower, at any time and from time to time
on or after the Closing Date and prior to the L/C Maturity Date, may request
that the Letter of Credit Issuer issue, for the account of the Borrower, a
standby letter of credit or letters of credit in such form as may be approved
by the Letter of Credit Issuer in its reasonable discretion.
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(b) Notwithstanding the foregoing, (i) no Letter of Credit shall
be issued the Stated Amount of which, when added to the Letter of Credit
Outstandings at such time, would exceed the Letter of Credit Commitment then
in effect; (ii) no Letter of Credit shall be issued the Stated Amount of
which, when added to the sum of (x) the Letter of Credit Outstandings at such
time and (y) the aggregate principal of all Revolving Credit Loans and
Swingline Loans then outstanding, would exceed (A) prior to the Perfection
Date, the excess of the Total Revolving Credit Commitment then in effect
minus the Perfection Date Commitments or (B) on and after the Perfection
Date, the Total Revolving Credit Commitment then in effect; (iii) each Letter
of Credit shall have an expiry date occurring no later than one year after
the date of issuance thereof, unless otherwise agreed upon by the
Administrative Agent and the Letter of Credit Issuer, provided that in no
event shall such expiry date occur later than the L/C Maturity Date; (iv)
each Letter of Credit shall be denominated in Dollars; and (v) no Letter of
Credit shall be issued by the Letter of Credit Issuer after it has received a
written notice from the Borrower or any Lender stating that a Default or
Event of Default has occurred and is continuing until such time as the Letter
of Credit Issuer shall have received a written notice of (x) rescission of
such notice from the party or parties originally delivering such notice or
(y) the waiver of such Default or Event of Default in accordance with the
provisions of Section 13.1.
(c) Upon at least one Business Day's prior written notice (or
telephonic notice promptly confirmed in writing) to the Administrative Agent
and the Letter of Credit Issuer (which notice the Administrative Agent shall
promptly transmit to each of the Lenders), the Borrower shall have the right,
on any day, permanently to terminate or reduce the Letter of Credit
Commitment in whole or in part, provided that, after giving effect to such
termination or reduction, the Letter of Credit Outstandings shall not exceed
the Letter of Credit Commitment.
3.2 Letter of Credit Requests. (a) Whenever the Borrower desires
that a Letter of Credit be issued for its account, it shall give the
Administrative Agent and the Letter of Credit Issuer at least five (or such
lesser number as may be agreed upon by the Administrative Agent and the
Letter of Credit Issuer) Business Days' written notice thereof. Each notice
shall be executed by the Borrower and shall be in the form of Exhibit B (each
a "Letter of Credit Request"). The Administrative Agent shall promptly
transmit copies of each Letter of Credit Request to each Lender.
(b) The making of each Letter of Credit Request shall be deemed to
be a representation and warranty by the Borrower that the Letter of Credit
may be issued in accordance with, and will not violate the requirements of,
Section 3.1(b).
3.3 Letter of Credit Participations. (a) Immediately upon the
issuance by the Letter of Credit Issuer of any Letter of Credit, the Letter
of Credit Issuer shall be deemed to have sold and transferred to each other
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Lender (each such other Lender, in its capacity under this Section 3.3, an
"L/C Participant"), and each such L/C Participant shall be deemed irrevocably
and unconditionally to have purchased and received from the Letter of Credit
Issuer, without recourse or warranty, an undivided interest and participation
(each an "L/C Participation"), to the extent of such L/C Participant's
Revolving Credit Commitment Percentage, in such Letter of Credit, each
substitute letter of credit, each drawing made thereunder and the obligations
of the Borrower under this Agreement with respect thereto, and any security
therefor or guaranty pertaining thereto (although Letter of Credit Fees will
be paid directly to the Administrative Agent for the ratable account of the
L/C Participants as provided in Section 4.1(b) and the L/C Participants shall
have no right to receive any portion of any Fronting Fees).
(b) In determining whether to pay under any Letter of Credit, the
Letter of Credit Issuer shall have no obligation relative to the L/C
Participants other than to confirm that any documents required to be
delivered under such Letter of Credit have been delivered and that they
appear to comply on their face with the requirements of such Letter of
Credit. Any action taken or omitted to be taken by the Letter of Credit
Issuer under or in connection with any Letter of Credit issued by it, if
taken or omitted in the absence of gross negligence or willful misconduct,
shall not create for the Letter of Credit Issuer any resulting liability.
(c) In the event that the Letter of Credit Issuer makes any
payment under any Letter of Credit issued by it and the Borrower shall not
have repaid such amount in full to the Letter of Credit Issuer pursuant to
Section 3.4(a), the Letter of Credit Issuer shall promptly notify the
Administrative Agent and each L/C Participant of such failure, and each L/C
Participant shall promptly and unconditionally pay to the Administrative
Agent, for the account of the Letter of Credit Issuer, the amount of such L/C
Participant's Revolving Credit Commitment Percentage of such unreimbursed
payment in Dollars and in same day funds; provided, however, that no L/C
Participant shall be obligated to pay to the Administrative Agent for the
account of the Letter of Credit Issuer its Revolving Credit Commitment
Percentage of such unreimbursed amount arising from any wrongful payment made
by the Letter of Credit Issuer under a Letter of Credit as a result of acts
or omissions constituting willful misconduct or gross negligence on the part
of the Letter of Credit Issuer. if the Letter of Credit Issuer so notifies,
prior to 11:00 A.M. (New York time) on any Business Day, any L/C Participant
required to fund a payment under a Letter of Credit, such L/C Participant
shall make available to the Administrative Agent for the account of the
Letter of Credit Issuer such L/C Participant's Revolving Credit Commitment
Percentage of the amount of such payment on such Business Day in same day
funds. If and to the extent such L/C Participant shall not have so made its
Revolving Credit Commitment Percentage of the amount of such payment
available to the Administrative Agent for the account of the Letter of Credit
Issuer, such L/C Participant agrees to pay to the Administrative Agent for
the account of the Letter of Credit Issuer, forthwith on demand, such amount,
together with interest thereon for each day from such date until the date
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such amount is paid to the Administrative Agent for the account of the Letter
of Credit Issuer at the Federal Funds Effective Rate. The failure of any L/C
Participant to make available to the Administrative Agent for the account of
the Letter of Credit Issuer its Revolving Credit Commitment Percentage of any
payment under any Letter of Credit shall not relieve any other L/C Participant
of its obligation hereunder to make available to the Administrative Agent for
the account of the Letter of Credit Issuer its Revolving Credit Commitment
Percentage of any payment under such Letter of Credit on the date required, as
specified above, but no L/C Participant shall be responsible for the failure
of any other L/C Participant to make available to the Administrative Agent such
other L/C Participant's Revolving Credit Commitment Percentage of any such
payment.
(d) Whenever the Letter of Credit Issuer receives a payment in
respect of an unpaid reimbursement obligation as to which the Administrative
Agent has received for the account of the Letter of Credit Issuer any
payments from the L/C Participants pursuant to paragraph (c) above, the
Letter of Credit Issuer shall pay to the Administrative Agent and the
Administrative Agent shall promptly pay to each L/C Participant that has paid
its Revolving Credit Commitment Percentage of such reimbursement obligation,
in Dollars and in same day funds, an amount equal to such L/C Participant's
share (based upon the proportionate aggregate amount originally funded by
such L/C Participant to the aggregate amount funded by all L/C Participants)
of the principal amount of such reimbursement obligation and interest thereon
accruing after the purchase of the respective L/C Participations.
(e) The obligations of the L/C Participants to make payments to
the Administrative Agent for the account of the Letter of Credit Issuer with
respect to Letters of Credit shall be irrevocable and not subject to
counterclaim, set-off or other defense or any other qualification or
exception whatsoever and shall be made in accordance with the terms and
conditions of this Agreement under all circumstances, including, without
limitation, any of the following circumstances:
(i) any lack of validity or enforceability of this Agreement
or any of the other Credit Documents;
(ii) the existence of any claim, set-off, defense or other
right that the Borrower may have at any time against a beneficiary
named in a Letter of Credit, any transferee of any Letter of Credit
(or any Person for whom any such transferee may be acting), the
Administrative Agent, the Letter of Credit Issuer, any Lender or
other Person, whether in connection with this Agreement, any Letter
of Credit, the transactions contemplated herein or any unrelated
transactions (including any underlying transaction between the
Borrower and the beneficiary named in any such Letter of Credit);
(iii) any draft, certificate or any other document presented
under any Letter of Credit proving to be forged, fraudulent,
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invalid or insufficient in any respect or any statement therein
being untrue or inaccurate in any respect;
(iv) the surrender or impairment of any security for the
performance or observance of any of the terms of any of the Credit
Documents; or
(v) the occurrence of any Default or Event of Default;
provided, however, that no L/C Participant shall be obligated to pay to the
Administrative Agent for the account of the Letter of Credit Issuer its
Revolving Credit Commitment Percentage of any unreimbursed amount arising
from any wrongful payment made by the Letter of Credit Issuer under a Letter
of Credit as a result of acts or omissions constituting willful misconduct or
gross negligence on the part of the Letter of Credit Issuer.
3.4 Agreement to Repay Letter of Credit Drawings. (a) The
Borrower hereby agrees to reimburse the Letter of Credit Issuer, by making
payment to the Administrative Agent in Dollars in immediately available funds
at the Administrative Agent's office, for any payment or disbursement made by
the Letter of Credit Issuer under any Letter of Credit (each such amount so
paid until reimbursed, an "Unpaid Drawing") immediately after, and in any
event on the date of, such payment, with interest on the amount so paid or
disbursed by the Letter of Credit Issuer, to the extent not reimbursed prior
to 5:00 P.M. (New York time) on the date of such payment or disbursement,
from and including the date paid or disbursed to but excluding the date the
Letter of Credit Issuer is reimbursed therefor, at a rate per annum that
shall at all times be the ABR as in effect from time to time, provided that,
notwithstanding anything contained in this Agreement to the contrary, (i)
unless the Borrower shall have notified the Administrative Agent and the
Letter of Credit Issuer prior to 10:00 A.M. on the date of such drawing that
the Borrower intends to reimburse the Letter of Credit Issuer for the amount
of such drawing with funds other than the proceeds of Loans, the Borrower
shall be deemed to have given a Notice of Borrowing to the Administrative
Agent requesting that the Lenders make Revolving Credit Loans (which shall
initially be ABR Loans) on the date on which such drawing is honored in an
amount equal to the amount of such drawing and (ii) each Lender shall, on
such date, make Revolving Credit Loans in an amount equal to such Lender's
pro rata portion of such Borrowing in accordance with the provisions of
Section 2.4.
(b) The Borrower's obligations under this Section 3.4 to reimburse
the Letter of Credit Issuer with respect to Unpaid Drawings (including, in
each case, interest thereon) shall be absolute and unconditional under any
and all circumstances and irrespective of any setoff, counterclaim or defense
to payment that the Borrower or any other Person may have or have had against
the Letter of Credit Issuer, the Administrative Agent or any Lender
(including in its capacity as an L/C Participant), including, without
limitation, any defense based upon the failure of any drawing under a Letter
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of Credit (each a "Drawing") to conform to the terms of the Letter of Credit
or any non-application or misapplication by the beneficiary of the proceeds
of such Drawing, provided that the Borrower shall not be obligated to
reimburse the Letter of Credit Issuer for any wrongful payment made by the
Letter of Credit Issuer under the Letter of Credit issued by it as a result
of acts or omissions constituting willful misconduct or gross negligence on
the part of the Letter of Credit Issuer.
(c) Each payment by the Letter of Credit Issuer under any Letter
of Credit shall constitute a request by the Borrower for an ABR Revolving
Credit Loan in the amount of the Unpaid Drawing in respect of such Letter of
Credit. The Letter of Credit Issuer shall notify the Borrower and the
Administrative Agent, by 10:00 A.M. (New York time) on any Business Day on
which the Letter of Credit Issuer intends to honor a drawing under a Letter
of Credit, of (i) the Letter of Credit Issuer's intention to honor such
drawing and (ii) the amount of such drawing. Unless otherwise instructed by
the Borrower by 10:30 A.M. (New York time) on such Business Day, the
Administrative Agent shall promptly notify each Lender of such drawing and
the amount of its Revolving Credit Loan to be made in respect thereof, and
each Lender shall be irrevocably obligated to make an ABR Revolving Credit
Loan to the Borrower in the amount of its Revolving Credit Commitment
Percentage of the applicable Unpaid Drawing by 12:00 noon (New York time) on
such Business Day by making the amount of such Revolving Credit Loan
available to the Administrative Agent at the Administrative Agent's Office.
Such Revolving Credit Loans shall be made without regard to the Minimum
Borrowing Amount. The Administrative Agent shall use the proceeds of such
Revolving Credit Loans solely for purpose of reimbursing the Letter of Credit
Issuer for the related Unpaid Drawing.
3.5 Increased Costs. If after the date hereof, the adoption of
any applicable law, rule or regulation, or any change therein, or any change
in the interpretation or administration thereof by any Governmental
Authority, central bank or comparable agency charged with the interpretation
or administration thereof, or actual compliance by the Letter of Credit
Issuer or any L/C Participant with any request or directive made or adopted
after the date hereof (whether or not having the force of law), by any such
authority, central bank or comparable agency shall either (a) impose, modify
or make applicable any reserve, deposit, capital adequacy or similar
requirement against letters of credit issued by the Letter of Credit Issuer,
or any L/C Participant's L/C Participation therein, or (b) impose on the
Letter of Credit Issuer or any L/C Participant any other conditions affecting
its obligations under this Agreement in respect of Letters of Credit or L/C
Participations therein or any Letter of Credit or such L/C Participant's L/C
Participation therein; and the result of any of the foregoing is to increase
the cost to the Letter of Credit Issuer or such L/C Participant of issuing,
maintaining or participating in any Letter of Credit, or to reduce the amount
of any sum received or receivable by the Letter of Credit Issuer or such L/C
Participant hereunder (other than any such increase or reduction attributable
to taxes) in respect of Letters of Credit or L/C Participations therein,
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then, promptly after receipt of written demand to the Borrower by the Letter
of Credit Issuer or such L/C Participant, as the case may be (a copy of which
notice shall be sent by the Letter of Credit Issuer or such L/C Participant
to the Administrative Agent), the Borrower shall pay to the Letter of Credit
Issuer or such L/C Participant such additional amount or amounts as will
compensate the Letter of Credit Issuer or such L/C Participant for such
increased cost or reduction, it being understood and agreed, however, that
the Letter of Credit Issuer or a L/C Participant shall not be entitled to such
compensation as a result of such Person's compliance with, or pursuant to any
request or directive to comply with, any such law, rule or regulation as in
effect on the date hereof. A certificate submitted to the Borrower by the
Letter of Credit Issuer or a L/C Participant, as the case may be (a copy of
which certificate shall be sent by the Letter of Credit Issuer or such L/C
Participant to the Administrative Agent), setting forth in reasonable detail
the basis for the determination of such additional amount or amounts
necessary to compensate the Letter of Credit Issuer or such L/C Participant
as aforesaid shall be conclusive and binding on the Borrower absent clearly
demonstrable error.
3.6 Successor Letter of Credit Issuer. The Letter of Credit
Issuer may resign as Letter of Credit Issuer upon 60 days' prior written
notice to the Administrative Agent, the Lenders and the Borrower. If the
Letter of Credit Issuer shall resign as Letter of Credit Issuer under this
Agreement, then the Borrower shall appoint from among the Lenders a successor
issuer of Letters of Credit, whereupon such successor issuer shall succeed to
the rights, powers and duties of the Letter of Credit Issuer, and the term
"Letter of Credit Issuer" shall mean such successor issuer effective upon
such appointment. At the time such resignation shall become effective, the
Borrower shall pay to the resigning Letter of Credit Issuer all accrued and
unpaid fees pursuant to Sections 4.1(c) and (d). The acceptance of any
appointment as the Letter of Credit Issuer hereunder by a successor Lender
shall be evidenced by an agreement entered into by such successor, in a form
satisfactory to the Borrower and the Administrative Agent and, from and after
the effective date of such agreement, such successor Lender shall have all
the rights and obligations of the previous Letter of Credit Issuer under this
Agreement. After the resignation of the Letter of Credit Issuer hereunder,
the resigning Letter of Credit Issuer shall remain a party hereto and shall
continue to have all the rights and obligations of a Letter of Credit Issuer
under this Agreement with respect to Letters of Credit issued by it prior to
such resignation, but shall not be required to issue additional Letters of
Credit. After any retiring Letter of Credit Issuer's resignation as Letter of
Credit Issuer, the provisions of this Agreement relating to the Letter of
Credit Issuer shall inure to its benefit as to any actions taken or omitted
to be taken by it (a) while it was Letter of Credit Issuer under this
Agreement or (b) at any time with respect to Letters of Credit issued by such
Letter of Credit Issuer.
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SECTION 4. Fees; Commitments.
4.1 Fees. (a) The Borrower agrees to pay to the Administrative
Agent, for the account of each Lender (pro rata according to their respective
Revolving Credit Commitments), a commitment fee for each day from and
including the Closing Date to but excluding the Final Date. Such commitment
fee shall be payable in arrears (x) on the last day of each month (for the
one-month period (or portion thereof) ended on such day) and (y) on the Final
Date (for the period ended on such date for which no payment has been
received pursuant to clause (x) above), and shall be computed for each day
during such period at a rate per annum equal to 0.50% on the Available
Commitments in effect on such day. Notwithstanding the foregoing, the
Borrower shall not be obligated to pay any amounts to any Defaulting Lender
pursuant to this Section 4.1.
(b) The Borrower agrees to pay to the Administrative Agent for the
account of the Lenders pro rata on the basis of their respective Letter of
Credit Exposure, a fee in respect of each Letter of Credit (the "Letter of
Credit Fee"), for the period from and including the date of issuance of such
Letter of Credit to but not including the termination date of such Letter of
Credit computed at the per annum rate for each day equal to the Applicable
Margin applicable to Eurodollar Loans on the average daily Stated Amount of
such Letter of Credit. Such Letter of Credit Fees shall be due and payable
monthly in arrears on the last day of each month and on the date upon which
the Total Revolving Credit Commitment terminates and the Letter of Credit
Outstandings shall have been reduced to zero.
(c) The Borrower agrees to pay to the Administrative Agent for the
account of the Letter of Credit Issuer a fee in respect of each Letter of
Credit issued by it (the "Fronting Fee"), for the period from and including
the date of issuance of such Letter of Credit to but not including the
termination date of such Letter of Credit, computed at the rate for each day
equal to 0.125% per annum on the average daily Stated Amount of such Letter
of Credit. Such Fronting Fees shall be due and payable monthly in arrears on
the last day of each month and on the date upon which the Total Revolving
Credit Commitment terminates and the Letter of Credit Outstandings shall have
been reduced to zero.
(d) The Borrower agrees to pay directly to the Letter of Credit
Issuer upon each issuance of, drawing under, and/or amendment of, a Letter of
Credit issued by it such amount as the Letter of Credit Issuer and the
Borrower shall have agreed upon for issuances of, drawings under or
amendments of, letters of credit issued by it.
(e) The Borrower agrees to pay to the Administrative Agent, on the
Closing Date, a fee in the amount of $450,000. The Administrative Agent shall
distribute such fee to the Lenders that have executed and delivered this
Agreement on or prior to 5:00 p.m., New York City time, on the later of
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December 23, 1998 and the Closing Date, pro rata in accordance with their
respective Revolving Credit Commitments.
4.2 Reduction of Revolving Credit Commitments. (a) Upon at least
one Business Day's prior written notice (or telephonic notice promptly
confirmed in writing) to the Administrative Agent at the Administrative
Agent's Office (which notice the Administrative Agent shall promptly transmit
to each of the Lenders), the Borrower shall have the right, without premium
or penalty, on any day, permanently to terminate or reduce the Revolving
Credit Commitments in whole or in part, provided that (i) any such reduction
shall apply proportionately and permanently to reduce the Revolving Credit
Commitment of each of the Lenders, (ii) any partial reduction pursuant to
this Section 4.2 shall be in the amount of at least $1,000,000 and (iii)
after giving effect to such termination or reduction and to any prepayments
of the Loans made on the date thereof in accordance with this Agreement, the
sum of (A) the aggregate outstanding principal amount of the Revolving Credit
Loans and the Swingline Loans and (B) the Letter of Credit Outstandings shall
not exceed the Total Revolving Credit Commitment.
(b) On the Closing Date, the Total Revolving Credit Commitment as
in effect under the Original Credit Agreement shall be permanently reduced by
$10,000,000 (from $100,000,000 to $90,000,000) and such reduction shall be
allocated proportionately to reduce the Revolving Credit Commitment of each
of the Lenders.
(c) In the event that a prepayment is required pursuant to Section
5.2(b), the Total Revolving Credit Commitment then in effect shall be
permanently reduced by an amount equal to the amount of such required
prepayment (regardless of the amount of Loans actually prepaid), and such
reduction shall be allocated proportionately to reduce the Revolving Credit
Commitment of each of the Lenders.
(d) If the Collateral Coverage Ratio immediately prior to a
Prepayment Event is greater than the Collateral Coverage Ratio immediately
after such Prepayment Event, then the Total Revolving Credit Commitment then
in effect shall be permanently reduced by an amount such that after such
reduction the Collateral Coverage Ratio will be equal to or greater than the
Collateral Coverage Ratio immediately prior to such Prepayment Event, and
such reduction shall be allocated proportionately to reduce the Revolving
Credit Commitment of each of the Lenders. If any Prepayment Event occurs, the
Borrower shall deliver to the Administrative Agent such information as the
Administrative Agent shall request relating to any change in the Collateral
Coverage Ratio resulting from such Prepayment Event, and the Administrative
Agent shall have the right to audit (at the Borrower's expense, including any
reasonable fees charged by the Administrative Agent for such audit) the
Borrower's calculation of any change in the Collateral Coverage Ratio
resulting from such Prepayment Event.
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4.3 Mandatory Termination of Commitments. (a) The Total
Revolving Credit Commitment shall terminate at 5:00 P.M. (New York time) on
the Revolving Credit Maturity Date.
(b) The Swingline Commitment shall terminate at 5:00 P.M. (New
York time) on the Swingline Maturity Date.
SECTION 5. Payments.
5.1 Voluntary Prepayments. The Borrower shall have the right to
prepay Revolving Credit Loans and Swingline Loans, without premium or
penalty, in whole or in part from time to time on the following terms and
conditions: (a) the Borrower shall give the Administrative Agent at the
Administrative Agent's Office written notice (or telephonic notice promptly
confirmed in writing) of its intent to make such prepayment, the amount of
such prepayment and (in the case of Eurodollar Loans) the specific
Borrowing(s) pursuant to which made, which notice shall be given by the
Borrower no later than (i) in the case of Revolving Credit Loans, 10:00 A.M.
(New York time) one Business Day prior to, or (ii) in the case of Swingline
Loans, 10:00 A.M. (New York time) on, the date of such prepayment and shall
promptly be transmitted by the Administrative Agent to each of the Lenders or
Chase, as the case may be; (b) each partial prepayment of any Borrowing of
Revolving Credit Loans shall be in a multiple of $100,000 and in an aggregate
principal amount of at least $1,000,000 and each partial prepayment of
Swingline Loans shall be in a multiple of $100,000 and in an aggregate
principal amount of at least $100,000, provide that no partial prepayment of
Eurodollar Loans made pursuant to a single Borrowing shall reduce the
outstanding Eurodollar Loans made pursuant to such Borrowing to an amount
less than the Minimum Borrowing Amount for Eurodollar Loans; and (c) any
prepayment of Eurodollar Loans pursuant to this Section 5.1 on any day other
than the last day of an Interest Period applicable thereto shall be subject
to compliance by the Borrower with the applicable provisions of Section 2.11.
At the Borrower's election in connection with any prepayment pursuant to this
Section 5.1, such prepayment shall not be applied to any Revolving Credit
Loan of a Defaulting Lender.
5.2 Mandatory Prepayments. (a) Aggregate Revolving Credit
Outstandings. If on any date the sum of the outstanding principal amount of
the Revolving Credit Loans and Swingline Loans and the aggregate amount of
Letter of Credit Outstandings (all the foregoing, collectively, the
"Aggregate Revolving Credit Outstandings") exceeds (A) prior to the
Perfection Date, the excess of the Total Revolving Credit Commitment then in
effect minus the Perfection Date Commitments or (B) on and after the
Perfection Date, the Total Revolving Credit Commitment as then in effect, the
Borrower shall forthwith repay on such date the principal amount of Swingline
Loans and, after all Swingline Loans have been paid in full, Revolving Credit
Loans, in an amount equal to such excess. If, after giving effect to the
prepayment of all outstanding Swingline Loans and Revolving Credit Loans, the
Aggregate Revolving Credit Outstandings exceed (A) prior to the Perfection
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Date, the excess of the Total Revolving Credit Commitment then in effect
minus the Perfection Date Commitments or (B) on and after the Perfection
Date, the Total Revolving Credit Commitment then in effect, the Borrower
shall pay to the Administrative Agent an amount in cash equal to such excess
and the Administrative Agent shall hold such payment for the benefit of the
Lenders as security for the obligations of the Borrower hereunder (including,
without limitation, obligations in respect of Letter of Credit Outstandings)
pursuant to a cash collateral agreement to be entered into in form and
substance satisfactory to the Administrative Agent (which shall permit
certain investments in Permitted Investments satisfactory to the
Administrative Agent, until the proceeds are applied to the secured
obligations).
(b) Prepayment Events. In the event and on each occasion that any
Net Proceeds are received by or on behalf of the Borrower or any Subsidiary
in respect of any Prepayment Event, the Borrower shall, immediately after
such Net Proceeds are received, prepay Loans in an aggregate amount
determined as follows: (i) no prepayment shall be required in respect of the
first $10,000,000 of Net Proceeds of Prepayment Events subsequent to the
Closing Date (determined on a cumulative basis); (ii) in the case of Net
Proceeds of Prepayment Events in excess of $10,000,000 subsequent to the
Closing Date (determined on a cumulative basis) up to $30,000,000, the amount
of the required prepayment shall be 50% of such Net Proceeds; and (iii) in
the case of Net Proceeds of Prepayment Events subsequent to the Closing Date
(determined on a cumulative basis) in excess of $30,000,000, the amount of
the required prepayment shall be 80% of such Net Proceeds; provide that, in
any event, in the case of any Prepayment Event consisting of a sale, transfer
or other disposition of, or casualty or damage to, or condemnation of any
Mortgaged Property or Collateral (other than a sale of Collateral in
connection with, and incidental to, a sale of a line of business or other
assets), the required prepayment shall be 100% of such Net Proceeds. In the
case of any Net Proceeds of a Pre-payment Event that are not required to be
applied to prepay Loans as provided in the preceding sentence, if such Net
Proceeds are required by Section 4.06 of the Note Indenture to be applied to
make a "Net Available Cash Offer" (as defined in the Note Indenture), then
the Borrower shall make such Net Available Cash Offer to the Lenders as well
as the holders of the 9.50% Notes. Any prepayment required by this paragraph
shall be made, first, of outstanding Swingline Loans and, second, after all
Swingline Loans have been paid in full, of outstanding Revolving Credit Loans
and, if after all such Loans have been paid in full any portion of the
required prepayment has not been fully applied and the Aggregate Revolving
Credit Outstandings exceed the Total Revolving Credit Commitment (or, prior
to the Perfection Date, the excess of the Total Revolving Commitment minus
the Perfection Date Commitments), the excess shall be paid to the
Administrative Agent as cash collateral as provided in paragraph (a) of this
Section. The Borrower shall give the Administrative Agent at the
Administrative Agent's Office written notice (or telephonic notice promptly
confirmed in writing) of its intent to make such prepayment and a reasonably
detailed calculation of the amount of such prepayment, which notice shall be
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given by the Borrower no later than 10:00 A.M. (New York time) one Business
Day prior to the date of such prepayment and shall promptly be transmitted by
the Administrative Agent to each of the Lenders.
(c) Excess Cash Balances. The Borrower shall prepay Loans at such
times and in such amounts as shall be necessary in order to comply with
Section 10.10.
(d) Application to Revolving Credit Loans. With respect to each
prepayment of Revolving Credit Loans required by Section 5.2(a), (b) or (c),
the Borrower may designate the Types of Loans that are to be prepaid and the
specific Borrowing(s) pursuant to which made, provided that (i) if any
prepayment of Eurodollar Loans made pursuant to a single Borrowing shall
reduce the outstanding Revolving Credit Loans made pursuant to such Borrowing
to an amount less than the Minimum Borrowing Amount for Eurodollar Loans,
such Borrowing shall immediately be converted into ABR Loans; (ii) each
prepayment of any Loans made pursuant to a Borrowing shall be applied pro
rata among such Loans; and (iii) notwithstanding the provisions of the
preceding clause (ii), no prepayment made pursuant to Section 5.2(a) of
Revolving Credit Loans shall be applied to the Revolving Credit Loans of any
Defaulting Lender. In the absence of a designation by the Borrower as
described in the preceding sentence, the Administrative Agent shall, subject
to the above, make such designation in its reasonable discretion with a view,
but no obligation, to minimize breakage costs owing under Section 2.11.
(e) Eurodollar Interest Periods. In lieu of making any payment
pursuant to this Section 5.2 in respect of any Eurodollar Loan other than on
the last day of the Interest Period therefor, so long as no Default or Event
of Default shall have occurred and be continuing, the Borrower at its option
may deposit with the Administrative Agent an amount equal to the amount of
the Eurodollar Loan to be prepaid and such Eurodollar Loan shall be repaid on
the last day of the Interest Period therefor in the required amount. Such
deposit shall be held by the Administrative Agent in a corporate time deposit
account established on terms reasonably satisfactory to the Administrative
Agent, earning interest at the then-customary rate for accounts of such type.
Such deposit shall constitute cash collateral for the Obligations, provided
that (i) the Borrower may at any time direct that such deposit be applied to
make the applicable payment required pursuant to this Section 5.2, (ii) at
any time that a Default or Event of Default has occurred and is continuing,
the Administrative Agent or the Required Lenders may direct that such deposit
be applied to make the applicable payment required pursuant to this Section
5.2 and (iii) any Lender that agrees to waive its rights under Section 2.11
with respect to such payment may at any time direct that the portion of such
deposit that would be applied to pay its Loans be so applied.
5.3 Method and Place of Payment. (a) Except as otherwise
specifically provided herein, all payments under this Agreement shall be
made, without set-off, counterclaim or deduction of any kind, to the
Administrative Agent for the ratable account of the Lenders entitled thereto,
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the Letter of Credit Issuer or Chase, as the case may be, not later than
12:00 Noon (New York time) on the date when due and shall be made in
immediately available funds and in lawful money of the United States of
America at the Administrative Agent's Office, it being understood that
written or facsimile notice by the Borrower to the Administrative Agent to
make a payment from the funds in the Borrower's account at the Administrative
Agent's office shall constitute the making of such payment to the extent of
such funds held in such account. The Administrative Agent will thereafter
cause to be distributed on the same day (if payment was actually received by
the Administrative Agent prior to 2:00 P.M. (New York time) on such day) like
funds relating to the payment of principal or interest or Fees ratably to the
Lenders entitled thereto.
(b) Any payments under this Agreement that are made later than
2:30 P.M. (New York time) shall be deemed to have been made on the next
succeeding Business Day. Whenever any payment to be made hereunder shall be
stated to be due on a day that is not a Business Day, the due date thereof
shall be extended to the next succeeding Business Day and, with respect to
payments of principal, interest shall be payable during such extension at the
applicable rate in effect immediately prior to such extension.
5.4 Net Payments. (a) All payments made by the Borrower under
this Agreement shall be made free and clear of, and without deduction or
withholding for or on account of, any current or future income, stamp or
other taxes, levies, imposts, duties, charges, fees, deductions or
withholdings, now or hereafter imposed, levied, collected, withheld or
assessed by any Governmental Authority, excluding (i) net income taxes and
franchise taxes (imposed in lieu of net income taxes) imposed on the
Administrative Agent or any Lender and (ii) any taxes imposed on the
Administrative Agent or any Lender as a result of a current or former
connection between the Administrative Agent or such Lender and the
jurisdiction of the Governmental Authority imposing such tax or any political
subdivision or taxing authority thereof or therein (other than any such
connection arising solely from the Administrative Agent or such Lender having
executed, delivered or performed its obligations or received a payment under,
or enforced, this Agreement). If any such non-excluded taxes, levies,
imposts, duties, charges, fees, deductions or withholdings ("Non-Excluded
Taxes") are required to be withheld from any amounts payable to the
Administrative Agent or any Lender hereunder, the amounts so payable to the
Administrative Agent or such Lender shall be increased to the extent
necessary to yield to the Administrative Agent or such Lender (after payment
of all Non-Excluded Taxes) interest or any such other amounts payable
hereunder at the rates or in the amounts specified in this Agreement;
provided, however, that the Borrower shall not be required to increase any
such amounts payable to any Lender that is not organized under the laws of
the United States of America or a state thereof if such Lender fails to
comply with the requirements of paragraph (b) of this Section 5.4. Whenever
any Non-Excluded Taxes are payable by the Borrower, as promptly as possible
thereafter the Borrower shall send to the Administrative Agent for its own
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account or for the account of such Lender, as the case may be, a certified
copy of an original official receipt received by the Borrower showing payment
thereof. If the Borrower fails to pay any Non-Excluded Taxes when due to the
appropriate taxing authority or fails to remit to the Administrative Agent
the required receipts or other required documentary evidence, the Borrower
shall indemnify the Administrative Agent and the Lenders for any incremental
taxes, interest, costs or penalties that may become payable by the
Administrative Agent or any Lender as a result of any such failure. The
agreements in this Section 5.4(a) shall survive the termination of this
Agreement and the payment of the Loans and all other amounts payable
hereunder.
(b) Each Lender that is not incorporated or organized under the
laws of the United States of America or a state thereof (a "Non-U.S. Lender")
shall:
(i) deliver to the Borrower and the Administrative Agent two
copies of either United States Internal Revenue Service Form 1001
or Form 4224 or, in the case of Non-U.S. Lender claiming exemption
from U.S. Federal withholding tax under Section 871(h) or 881(c) of
the Code with respect to payments of "portfolio interest", a Form
W-8, or any subsequent versions thereof or successors thereto (and,
if such Non-U.S. Lender delivers a Form W-8, a certificate
representing that such Non-U.S. Lender is not a bank for purposes
of Section 881(c) of the Code, is not a 10-percent shareholder
(within the meaning of Section 871(h)(3)(B) of the Code) of the
Borrower and is not a controlled foreign corporation related to the
Borrower (within the meaning of Section 864(d)(4) of the Code)),
properly completed and duly executed by such Non-U.S. Lender
claiming complete exemption from, or reduced rate of, U.S. Federal
withholding tax on payments by the Borrower under this Agreement;
(ii) deliver to the Borrower and the Administrative Agent two
further copies of any such form or certification on or before the
date that any such form or certification expires or becomes
obsolete and after the occurrence of any event requiring a change
in the most recent form previously delivered by it to the Borrower;
and
(iii) obtain such extensions of time for filing and complete
such forms or certifications as may reasonably be requested by the
Borrower or the Administrative Agent;
unless in any such case any change in treaty, law or regulation has occurred
prior to the date on which any such delivery would otherwise be required that
renders any such form inapplicable or would prevent such Lender from duly
completing and delivering any such form with respect to it and such Lender so
advises the Borrower and the Administrative Agent. Each Person that shall
become a Participant pursuant to Section 13.6 or a Lender pursuant to Section
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13.6 shall, upon the effectiveness of the related transfer, be required to
provide all the forms and statements required pursuant to this Section
5.4(b), provided that in the case of a Participant such Participant shall
furnish all such required forms and statements to the Lender from which the
related participation shall have been purchased.
(c) The Borrower shall not be required to indemnify any Non-U.S.
Lender, or to pay any additional amounts to any Non-U.S. Lender, in respect
of U.S. Federal withholding tax pursuant to paragraph (a) above to the extent
that (i) the obligation to withhold amounts with respect to U.S. Federal
withholding tax existed on the date such Non-U.S. Lender became a party to
this Agreement (or, in the case of a Non-U.S. Participant, on the date such
Participant became a Participant hereunder); provided, however, that this
clause (i) shall not apply to the extent that (x) the indemnity payments or
additional amounts any Lender (or Participant) would be entitled to receive
(without regard to this clause (i)) do not exceed the indemnity payment or
additional amounts that the person making the assignment, participation or
transfer to such Lender (or Participant) would have been entitled to receive
in the absence of such assignment, participation or transfer, or (y) such
assignment, participation or transfer had been requested by the Borrower,
(ii) the obligation to pay such additional amounts would not have arisen but
for a failure by such Non-U.S. Lender or Non-U.S. Participant to comply with
the provisions of paragraph (b) above or (iii) any of the representations or
certifications made by a Non-U.S. Lender or Non-U.S. Participant pursuant to
paragraph (b) above are incorrect at the time a payment hereunder is made,
other than by reason of any change in treaty, law or regulation having effect
after the date such representations or certifications were made.
(d) If the Borrower determines in good faith that a reasonable
basis exists for contesting any taxes for which indemnification has been
demanded hereunder, the relevant Lender or the Administrative Agent, as
applicable, shall cooperate with the Borrower in challenging such taxes at
the Borrower's expense if so requested by the Borrower. If any Lender or the
Administrative Agent, as applicable, receives a refund of a tax for which a
payment has been made by the Borrower pursuant to this Agreement, which
refund in the good faith judgment of such Lender or Administrative Agent, as
the case may be, is attributable to such payment made by the Borrower, then
the Lender or the Administrative Agent, as the case may be, shall reimburse
the Borrower for such amount as the Lender or Administrative Agent, as the
case may be, determines to be the proportion of the refund as will leave it,
after such reimbursement, in no better or worse position than it would have
been in if the payment had not been required. A Lender or Administrative
Agent shall claim any refund that it determines is available to it, unless it
concludes in its reasonable discretion that it would be adversely affected by
making such a claim. Neither the Lender nor the Administrative Agent shall be
obliged to disclose any information regarding its tax affairs or computations
to the Borrower in connection with this paragraph (d) or any other provision
of this Section 5.4.
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(e) Each Lender represents and agrees that, on the date hereof and
at all times during the term of this Agreement, it is not and will not be a
conduit entity participating in a conduit financing arrangement (as defined
in Section 7701(l) of the Code and the regulations thereunder) with respect
to the Borrowings hereunder unless the Borrower has consented to such
arrangement prior thereto.
5.5 Computations of Interest and Fees. (a) Interest on
Eurodollar Loans and, except as provided in the next succeeding sentence, ABR
Loans shall be calculated on the basis of a 360-day year for the actual days
elapsed. Interest on ABR Loans in respect of which the rate of interest is
calculated on the basis of the Prime Rate and interest on overdue interest
shall be calculated on the basis of a 365- (or 366-, as the case may be) day
year for the actual days elapsed.
(b) Fees and Letter of Credit Outstandings shall be calculated on
the basis of a 365- (or 366-, as the case may be) day year for the actual
days elapsed.
SECTION 6. Conditions Precedent.
6.1 Effectiveness of Agreement. The effectiveness of the
amendment and restatement of the Original Credit Agreement in the form of
this Agreement is subject to the satisfaction of the following conditions
precedent:
(a) The Administrative Agent shall have received counterparts of
this Agreement, executed and delivered by a duly authorized officer of the
General Partner, on behalf of the Borrower, and of the Required Lenders.
(b) The Administrative Agent shall have received a certificate of
the General Partner, dated the Closing Date, substantially in the form of
Exhibit E, with appropriate insertions, executed by the President or any Vice
President and the Secretary or any Assistant Secretary of the General
Partner, and attaching the documents referred to in paragraphs (c) and (d) of
this Section.
(c) The Administrative Agent shall have received a copy of (a) the
resolutions, in form and substance satisfactory to the Administrative Agent,
of the Board of Directors of the General Partner (or a duly authorized
committee thereof) authorizing the execution, delivery and performance by the
Borrower of the Credit Documents and the extension of credit contemplated
hereunder and (b) any other resolutions or authorizations necessary to
authorize the execution, delivery and performance by the Borrower of the
Credit Documents.
(d) The Administrative Agent shall have received true and complete
copies of (a) the agreement of limited partnership, as amended, of the
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Borrower and (b) the certificate of incorporation and by-laws of the General
Partner.
(e) The Administrative Agent shall have received (i) the fee
referred to in Section 4.1(e) and (ii) payment of all out-of-pocket expenses
of the Administrative Agent and each Lender required to be paid or reimbursed
by the Borrower hereunder, to the extent reasonably documented invoices
therefor have been given to the Borrower prior to the Closing Date.
(f) The Administrative Agent shall have received, with a
counterpart for each Lender, the executed legal opinions of (a) Simpson
Thacher & Bartlett, special New York counsel to the Borrower, substantially
in the form of Exhibit C-1, and (b) Lawrence L. Dieker, counsel to the
Borrower, substantially in the form of Exhibit C-2, and the Borrower hereby
instructs such counsel to deliver such legal opinions.
(g) The Administrative Agent shall have received (i) counterparts
of the Security Agreement signed on behalf of the Borrower and each
Subsidiary (other than VEI Limited Partnership) and (ii) evidence
satisfactory to it that all documents and instruments, including Uniform
Commercial Code financing statements, required by law or reasonably requested
by the Administrative Agent to be filed, registered or recorded to create or
perfect the Liens intended to be created under the Security Agreement have
been delivered to the Administrative Agent.
(h) The Administrative Agent shall have received a completed
Perfection Certificate dated the Closing Date and signed by an Authorized
Officer, together with all attachments contemplated thereby.
(i) The Administrative Agent shall have received evidence
satisfactory to it that the insurance with respect to the Collateral required
by the Security Agreement is in effect and that the Administrative Agent has
been named as an additional insured and loss payee under all insurance
policies to be maintained with respect to the properties of the Borrower and
the Subsidiaries constituting the Collateral.
(j) The Administrative Agent shall have received a Collateral
Certificate dated the Closing Date and signed by an Authorized officer.
(k) [Intentionally omitted].
(l) The Borrower shall have repaid Revolving Credit Loans to the
extent required in order to comply with Section 10.10.
(m) The Administrative Agent shall have received an agreement in
the form of Exhibit I signed on behalf of the General Partner.
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6.2 Perfection Date Commitments. The Perfection Date Commitments
shall not be available until the satisfaction of the following conditions
precedent:
(a) The Administrative Agent shall have received (i) counterparts
of the Mortgage signed on behalf of the record owner of such Mortgaged
Property, (ii) a policy or policies of title insurance issued by a nationally
recognized title insurance company, insuring the Lien of the mortgage as a
valid first Lien on the Mortgaged Property, free of any other Liens (except
Liens disclosed in such title insurance and reasonably acceptable to the
Administrative Agent, it being understood that any Liens securing
Indebtedness shall not be acceptable), together with such endorsements,
coinsurance and reinsurance as the Administrative Agent or the Required
Lenders may reasonably request and (iii) such surveys and abstracts as may be
required pursuant to the Mortgage or as the Administrative Agent or the
Required Lenders may reasonably request.
(b) The Administrative Agent and the Lenders shall have received
evidence reasonably satisfactory to the Administrative Agent (after
consulting with the Lenders) as to the absence of any material environmental
exposures related to the Mortgaged Property.
(c) The Administrative Agent shall have received calculations,
certified by an Authorized Officer, demonstrating the maximum amount of the
obligations that may be secured by the Mortgage in accordance with clause
(xii) of the definition of "Permitted Liens" (as defined in the Note
Indenture), and such amount shall not be less than $17,000,000.
(d) The Administrative Agent shall be reasonably satisfied that
the value of the Mortgaged Property as collateral security for the
Obligations substantially exceeds the maximum amount of the Obligations
secured thereby.
(e) The Mortgage shall have been recorded as necessary in order to
perfect the Lien of the Mortgage on the Mortgaged Property.
(f) A period of 91 days shall have elapsed since the date of
perfection of the Lien of the Mortgage on the Mortgaged Property, and the
Administrative Agent shall have received a certificate of an Authorized
Officer to such effect.
SECTION 7. Conditions Precedent to All Credit Events. The
agreement of each Lender to make any Loan requested to be made by it on any
date (excluding Mandatory Borrowings) and the obligation of the Letter of
Credit Issuer to issue Letters of Credit on any date is subject to the
satisfaction of the following conditions precedent:
7.1 No Default; Representations and Warranties. At the time of
each Credit Event and also after giving effect thereto (a) there shall exist
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no Default or Event of Default and (b) all representations and warranties
made by the Borrower contained herein or in the other Credit Documents shall
be true and correct in all material respects with the same effect as though
such representations and warranties had been made on and as of the date of
such Credit Event (except where such representations and warranties expressly
relate to an earlier date, in which case such representations and warranties
shall have been true and correct in all material respects as of such earlier
date).
7.2 Notice of Borrowing; Letter of Credit Request. (a) Prior to
the making of each Revolving Credit Loan (other than any Revolving Credit
Loan made pursuant to Section 3.4(a)) and each Swingline Loan, the
Administrative Agent shall have received a Notice of Borrowing (whether in
writing or by telephone) meeting the requirements of Section 2.3.
(b) Prior to the issuance of each Letter of Credit, the
Administrative Agent and the Letter of Credit Issuer shall have received a
Letter of Credit Request meeting the requirements of Section 3.2(a).
The acceptance of the benefits of each Credit Event shall constitute a
representation and warranty by the Borrower to each of the Lenders that all
the applicable conditions specified above exist as of that time.
SECTION 8. Representations, Warranties and Agreements. In order
to induce the Lenders to enter into this Agreement, to make the Loans and
issue or participate in Letters of Credit as provided for herein, the
Borrower makes the following representations and warranties to, and
agreements with, the Lenders, all of which shall survive the execution and
delivery of this Agreement and the making of the Loans and the issuance of
the Letters of Credit:
8.1 Organization. The Borrower and each Subsidiary (a) is a duly
organized and validly existing limited partnership (in the case of the
Borrower) or corporation or other entity (in the case of each Subsidiary) in
each case in good standing under the laws of the jurisdiction of its
organization and has the partnership, corporate or other organizational power
and authority to own its property and assets and to transact the business in
which it is engaged and (b) has duly qualified and is authorized to do
business and is in good standing in all jurisdictions where it is required to
be so qualified, except where the failure to be so qualified could not
reasonably be expected to result in a Material Adverse Effect.
8.2 Power and Authority. Each of the Borrower and the
Subsidiaries has the power and authority to execute, deliver and carry out
the terms and provisions of the Credit Documents to which it is a party and
each of the Borrower, the Subsidiaries and the General Partner has taken all
necessary action to authorize the execution, delivery and performance by each
of the Borrower and the Subsidiaries of the Credit Documents, as applicable.
Each of the Borrower and the Subsidiaries has duly executed and delivered
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each Credit Document to which it is a party and each such Credit Document
constitutes the legal, valid and binding obligation of the Borrower and any
such Subsidiary, as the case may be, enforceable in accordance with its
terms, except as the enforceability thereof may be limited by bankruptcy,
insolvency or similar laws affecting creditors' rights generally and subject
to general principles of equity.
8.3 No Violation. Neither the execution, delivery and performance
by the Borrower and the Subsidiaries of the Credit Documents to which it is a
party nor compliance with the terms and provisions thereof will (a)
contravene any applicable provision of any material law, statute, rule,
regulation, order, writ, injunction or decree of any court or governmental
instrumentality, (b) result in any breach of any of the terms, covenants,
conditions or provisions of, or constitute a default under, or result in the
creation or imposition of (or the obligation to create or impose) any Lien
upon any of the property or assets of the Borrower or any of the Subsidiaries
pursuant to, the terms of any material indenture (including the Note
Indenture), loan agreement, lease agreement, mortgage, deed of trust,
agreement or other material instrument to which the Borrower or any of its
Subsidiaries is a party or by which it or any of its property or assets is
bound or (c) violate any provision of the agreement of limited partnership of
the Borrower or the certificate of incorporation or By-Laws of the General
Partner or any of the Borrower's Subsidiaries.
8.4 Litigation. Except as set forth in the Borrower's audited
financial statements for the fiscal year ended December 31, 1997, there are
no actions, suits or proceedings (including, without limitation,
Environmental Claims) pending or, to the knowledge of the Borrower,
threatened with respect to the Borrower or any of its Subsidiaries that could
reasonably be expected to result in a Material Adverse Effect.
8.5 Margin Regulations. Neither the making of any Loan hereunder
nor the use of the proceeds thereof will violate the provisions of Regulation
G, T, U or X of the Board.
8.6 Governmental Approvals. No order, consent, approval, license,
authorization, or validation of, or filing, recording or registration with,
or exemption by, any Governmental Authority is required to authorize or is
required in connection with (a) the execution, delivery and performance of
any Credit Document or (b) the legality, validity, binding effect or
enforceability of any Credit Document, except any of the foregoing the
failure to obtain or make could not reasonably be expected to have a Material
Adverse Effect.
8.7 Investment Company Act and Public Utility Holding Company Act.
The Borrower is not an "investment company" within the meaning of the
Investment Company Act of 1940, as amended. The Borrower is not a "holding
company" as defined in, or subject to regulation under, the Public Utility
Holding Company Act of 1935, as amended.
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8.8 True and Complete Disclosure. (a) All factual information
and data (taken as a whole) heretofore or contemporaneously furnished by the
Borrower, any of its Subsidiaries or any of their respective authorized
representatives in writing to the Administrative Agent and/or any Lender on
or before the Closing Date (including, without limitation, (i) the
Confidential Information Memorandum and (ii) all information contained in the
Credit Documents) for purposes of or in connection with this Agreement or any
transaction contemplated herein was true and complete in all material
respects on the date as of which such information or data is dated or
certified and was not incomplete by omitting to state any material fact
necessary to make such information and data (taken as a whole) not misleading
at such time in light of the circumstances under which such information or
data was furnished, it being understood and agreed that for purposes of this
Section 8.8(a), such factual information and data shall not include
projections and pro forma financial information.
(b) The projections and pro forma financial information contained
in the information and data referred to in paragraph (a) above were based on
good faith estimates and assumptions believed by such Persons to be
reasonable at the time made, it being recognized by the Lenders that such
projections as to future events are not to be viewed as facts and that actual
results during the period or periods covered by any such projections may
differ from the projected results.
8.9 Financial Condition; Financial Statements. (a) The
consolidated balance sheet of the Borrower and its Subsidiaries at December
31, 1997, and the related consolidated statements of operations, cash flows
and changes in partners, capital for the fiscal year ended as of such date,
which statements have been audited by Price Waterhouse LLP, independent
certified public accountants, who delivered an unqualified opinion with
respect thereto, and (b) the unaudited consolidated balance sheet of the
Borrower and its Subsidiaries at September 30, 1998, and the related
consolidated statements of operations, cash flows and changes in partners'
capital for the respective fiscal quarters and portions of the fiscal year
ended as of such dates, in each case present fairly in all material respects
the consolidated financial position of the Borrower and its Subsidiaries at
the respective dates of said statements and the results of operations for the
respective periods covered thereby. All such financial statements have been
prepared in accordance with GAAP consistently applied except to the extent
provided in the notes to said financial statements and, in the case of said
financial statements referred to in clause (b), subject to normal year-end
audit adjustments. There has been no Material Adverse Change since September
30, 1998, other than solely as a result of changes in general economic
conditions.
8.10 Tax Returns and Payments. Each of the Borrower and its
Subsidiaries has filed all federal income tax returns and all other material
tax returns, domestic and foreign, required to be filed by it and has paid
all material taxes and assessments payable by it that have become due, other
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than those not yet delinquent or contested in good faith. The Borrower and
each of its Subsidiaries have paid, or have provided adequate reserves (in
the good faith judgment of the management of the Borrower) in accordance with
GAAP for the payment of, all material federal, state and foreign income taxes
applicable for all prior fiscal years and for the current fiscal year to the
Closing Date.
8.11 Compliance with ERISA. Each Plan is in compliance with
ERISA, the Code and any applicable Requirement of Law; no Reportable Event
has occurred (or is reasonably likely to occur) with respect to any Plan; no
Plan is insolvent or in reorganization (or is reasonably likely to be
insolvent or in reorganization), and no written notice of any such insolvency
or reorganization has been given to the Borrower, any Subsidiary or any ERISA
Affiliate; no Plan (other than a multiemployer plan) has an accumulated or
waived funding deficiency (or is reasonably likely to have such a
deficiency); neither the Borrower nor any Subsidiary nor any ERISA Affiliate
has incurred (or is reasonably likely expected to incur) any liability to or
on account of a Plan pursuant to Section 409, 502(i), 502(l), 515, 4062,
4063, 4064, 4069, 4201 or 4204 of ERISA or Section 4971 or 4975 of the Code
or has been notified in writing that it will incur any liability under any of
the foregoing Sections with respect to any Plan; no proceedings have been
instituted (or are reasonably likely to be instituted) to terminate or to
reorganize any Plan or to appoint a trustee to administer any Plan, and no
written notice of any such proceedings has been given to the Borrower, any
Subsidiary or any ERISA Affiliate; and no lien imposed under the Code or
ERISA on the assets of the Borrower or any Subsidiary or any ERISA Affiliate
exists (or is reasonably likely to exist) nor has the Borrower, any
Subsidiary or any ERISA Affiliate been notified in writing that such a lien
will be imposed on the assets of the Borrower, any Subsidiary or any ERISA
Affiliate on account of any Plan, except to the extent that a breach of any
of the foregoing representations, warranties or agreements in this Section
8.11 would not result, individually or in the aggregate, in an amount of
liability that would be reasonably likely to have a material Adverse Effect
or relates to any matter disclosed in the financial statements of the
Borrower contained in the Confidential Information Memorandum. No Plan (other
than a multiemployer plan) has an Unfunded Current Liability that would,
individually or when taken together with any other liabilities referenced in
this Section 8.11, be reasonably likely to have a Material Adverse Effect.
With respect to Plans that are multiemployer plans (as defined in Section
3(37) of ERISA), the representations and warranties in this Section 8.11,
other than any made with respect to (a) liability under Section 4201 or 4204
of ERISA or (b) liability for termination or reorganization of such Plans
under ERISA, are made to the best knowledge of the Borrower.
8.12 Subsidiaries. Schedule 8.12 sets forth the name of, and the
direct or indirect percentage ownership interest of the Borrower in, each
Subsidiary of the Borrower as of the Closing Date.
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8.13 Patents, etc. The Borrower and each of its Subsidiaries have
obtained all patents, trademarks, servicemarks, trade names, copyrights,
licenses and other rights, free from burdensome restrictions, that are
necessary for the operation of their respective businesses as currently
conducted and as proposed to be conducted, except where the failure to obtain
any such rights could not reasonably be expected to have a Material Adverse
Effect.
8.14 Environmental Laws. (a) Other than instances of
noncompliance that could not reasonably be expected to have a Material
Adverse Effect: (i) the Borrower and each of its Subsidiaries are in
compliance with all Environmental Laws in all jurisdictions in which the
Borrower and each of its Subsidiaries are currently doing business
(including, without limitation, having obtained all material permits required
under Environmental Laws) and (ii) the Borrower will comply and cause each of
its Subsidiaries to comply with all such Environmental Laws (including,
without limitation, all permits required under Environmental Laws).
(b) Neither the Borrower nor any of its Subsidiaries has treated,
stored, transported or disposed of Hazardous Materials at or from any
currently or formerly owned Real Estate (as defined in Section 9.1(e)) or
facility relating to its business in a manner that could reasonably be
expected to have a Material Adverse Effect.
8.15 Properties. The Borrower and each of its Subsidiaries have
good title to or leasehold interest in all properties that are necessary for
the operation of their respective businesses as currently conducted and as
proposed to be conducted, free and clear of all Liens (other than any Liens
permitted by this Agreement) and except where the failure to have such good
title could not reasonably be expected to have a Material Adverse Effect.
8.16 Security Agreement. The representations and warranties in
the Security Agreement are true and correct.
SECTION 9. Affirmative Covenants. The Borrower hereby covenants
and agrees that on the Closing Date and thereafter, for so long as this
Agreement is in effect and until the Revolving Credit Commitments, the
Swingline Commitment and each Letter of Credit have terminated and the Loans
and Unpaid Drawings, together with interest, Fees and all other Obligations
incurred hereunder, are paid in full:
9.1 Information Covenants. The Borrower will furnish to each
Lender and the Administrative Agent:
(a) Annual Financial Statements. As soon as available and in any
event within 95 days after the close of each fiscal year of the
Borrower, the consolidated balance sheet of the Borrower and its
Subsidiaries as at the end of such fiscal year and the related
consolidated statements of operations, cash flows and changes in
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partners' capital for such fiscal year, setting forth comparative
consolidated figures for the preceding fiscal year, and certified by
independent certified public accountants of recognized national standing
whose opinion shall not be qualified as to the scope of audit or as to
the status of the Borrower or any of its Subsidiaries as a going
concern, together in any event with a certificate of such accounting
firm stating that in the course of its regular audit of the business of
the Borrower and its Subsidiaries, which audit was conducted in
accordance with generally accepted auditing standards, such accounting
firm has obtained no knowledge of any Default or Event of Default
relating to Sections 10.8 and 10.9 that has occurred and is continuing
or, if in the opinion of such accounting firm such a Default or Event of
Default has occurred and is continuing, a statement as to the nature
thereof.
(b) Quarterly Financial Statements. As soon as available and in
any event within 50 days after the close of each of the first three
fiscal quarters of each fiscal year of the Borrower, the consolidated
balance sheet of the Borrower and its Subsidiaries as at the end of such
quarterly period and the related consolidated statements of operations,
cash flows and changes in partners' capital for such quarterly
accounting period and for the elapsed portion of the fiscal year ended
with the last day of such quarterly period, and the related consolidated
statement of cash flows for the elapsed portion of the fiscal year ended
with the last day of such quarterly period, and setting forth
comparative consolidated figures for the related periods in the prior
fiscal year or, in the case of such consolidated balance sheet, for the
last day of the prior fiscal year, all of which shall be certified by an
Authorized Officer, subject to changes resulting from audit and normal
year-end audit adjustments.
(c) Monthly Financial Statements. Within 30 days after the end of
each fiscal month of the Borrower, the consolidated balance sheet of the
Borrower and its Subsidiaries as at the end of such fiscal month and
related statements of operations, cash flows and changes in partners'
capital for such fiscal month and the then elapsed portion of the fiscal
year ended with the last day of such fiscal month, all of which shall be
certified by an Authorized Officer, subject to changes resulting from
audit and normal year-end audit adjustments.
(d) Officer's Certificates. (i) At the time of the delivery of
the financial statements provided for in Sections 9.1(a), (b) and (c), a
certificate of an Authorized Officer to the effect that no Default or
Event of Default exists or, if any Default or Event of Default does
exist, specifying the nature and extent thereof, which certificate shall
set forth the calculations required to establish whether the Borrower
and its Subsidiaries were in compliance with the provisions of (A)
Section 10.9 as at the end of such fiscal year or period, as the case
may be, and (B) Section 10.6 with respect to all Restricted Payments
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made since the date of the most recent certificate delivered pursuant to
this paragraph (or, in the case of the first such certificate, since the
date of this Agreement).
(ii) Not less than five Business Days, and not more than 10
Business Days, before each date on which an interest payment is made
with respect to the 9.50% Notes, a certificate of an Authorized Officer
to the effect that, both before and after giving effect to such interest
payment, no Default or Event of Default exists or will exist or, if any
Default or Event of Default exists or will exist, specifying the nature
and extent thereof.
(e) Notice of Default or Litigation. Promptly after an Authorized
Officer obtains knowledge thereof, notice of (i) the occurrence of any
event that constitutes a Default or Event of Default, which notice shall
specify the nature thereof, the period of existence thereof and what
action the Borrower proposes to take with respect thereto, and (ii) any
litigation or governmental proceeding pending against the Borrower or
any of its Subsidiaries that could reasonably be expected to result in a
Material Adverse Effect.
(f) Collateral Certificate. Within 15 days after the end of each
calendar month, a completed Collateral Certificate as of the last day of
such calendar month, signed on behalf of the Borrower by an Authorized
Officer.
(g) Environmental Matters. The Borrower will promptly advise the
Lenders in writing after obtaining knowledge of any one or more of the
following environmental matters, unless such environmental matters would not,
individually or when aggregated with all other such matters, be reasonably
expected to result in a Material Adverse Effect:
(i) Any pending or threatened Environmental Claim against the
Borrower or any of its Subsidiaries or any Real Estate (as defined
below);
(ii) Any condition or occurrence on any Real Estate that (x)
results in noncompliance by the Borrower or any of its Subsidiaries
with any applicable Environmental Law or (y) could reasonably be
anticipated to form the basis of an Environmental Claim against the
Borrower or any of its Subsidiaries or any Real Estate;
(iii) Any condition or occurrence on any Real Estate that could
reasonably be anticipated to cause such Real Estate to be subject
to any restrictions on the ownership, occupancy, use or
transferability of such Real Estate under any Environmental Law;
and
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(iv) The taking of any removal or remedial action in response
to the actual or alleged presence of any Hazardous Material on any
Real Estate.
All such notices shall describe in reasonable detail the nature of the
claim, investigation, condition, occurrence or removal or remedial
action and the Borrower's response thereto. The term "Real Estate" shall
mean land, buildings and improvements owned or leased by the Borrower or
any of its Subsidiaries, but excluding all operating fixtures and
equipment, whether or not incorporated into improvements.
(h) Other Information. Promptly upon filing thereof, copies of any
filings on Form 10-K, 10-Q or 8-K or registration statements with, and
reports to, the SEC by the Borrower or any of its Subsidiaries (other than
amendments to any registration statement (to the extent such registration
statement, in the form it becomes effective, is delivered to the Lenders),
exhibits to any registration statement and any registration statements on
Form S-8) and copies of all financial statements, proxy statements, notices
and reports that the Borrower or any of its Subsidiaries shall send to the
holders of any publicly issued debt of the Borrower and/or any of its
Subsidiaries (including the 9.50% Notes) in their capacity as such holders
(in each case to the extent not theretofore delivered to the Lenders pursuant
to this Agreement) and, with reasonable promptness, such other information
(financial or otherwise) as the Administrative Agent on its own behalf or on
behalf of any Lender may reasonably request in writing from time to time.
9.2 Books, Records and Inspections. The Borrower will, and will
cause each of its Subsidiaries to, permit officers and designated
representatives of the Administrative Agent or the Required Lenders to visit
and inspect any of the properties or assets of the Borrower and any such
Subsidiary in whomsoever's possession to the extent that it is within the
Borrower's or such Subsidiary's control to permit such inspection, and to
examine the books of account of the Borrower and any such Subsidiary and
discuss the affairs, finances and accounts of the Borrower and of any such
Subsidiary with, and be advised as to the same by, its and their officers and
independent accountants, all at such reasonable times and intervals and to
such reasonable extent as the Administrative Agent or the Required Lenders
may desire.
9.3 Maintenance of Insurance. The Borrower will, and will cause
each of its Material Subsidiaries to, at all times maintain in full force and
effect, with insurance companies that the Borrower believes (in the good
faith judgment of the management of the Borrower) are financially sound and
responsible at the time the relevant coverage is placed or renewed, insurance
in at least such amounts and against at least such risks (and with such risk
retentions) as are usually insured against in the same general area by
companies engaged in the same or a similar business; and will furnish to the
Lenders, upon written request from the Administrative Agent, information
presented in reasonable detail as to the insurance so carried.
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9.4 Payment of Taxes. The Borrower 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 properties belonging to it, prior to the date
on which material penalties attach thereto, and all lawful material claims
that, if unpaid, could reasonably be expected to become a material Lien upon
any properties of the Borrower or any of its Subsidiaries, provided that
neither the Borrower nor any of its Subsidiaries shall be required to pay any
such tax, assessment, charge, levy or claim that is being contested in good
faith and by proper proceedings if it has maintained adequate reserves (in
the good faith judgment of the management of the Borrower) with respect
thereto in accordance with GAAP.
9.5 Existence. The Borrower will do, and will cause each material
Subsidiary to do, or cause to be done, all things necessary to preserve and
keep in full force and effect its existence, rights and authority, except to
the extent that the failure to do so could not reasonably be expected to have
a material Adverse Effect; provided, however, that the Borrower and its
Subsidiaries may consummate any transaction permitted under Section 10.3 or
10.4.
9.6 Compliance with Statutes, Obligations, etc. The Borrower
will, and will cause each Subsidiary to, comply with all applicable laws,
rules, regulations and orders, except to the extent the failure to do so
could not reasonably be expected to have a Material Adverse Effect.
9.7 ERISA. Promptly after the Borrower or any Subsidiary or any
ERISA Affiliate knows or has reason to know of the occurrence of any of the
following events that, individually or in the aggregate (including in the
aggregate such events previously disclosed or exempt from disclosure
hereunder, to the extent the liability therefor remains outstanding), would
be reasonably likely to have a Material Adverse Effect, the Borrower will
deliver to each of the Lenders a certificate of an Authorized officer or any
other senior officer of the Borrower setting forth details as to such
occurrence and the action, if any, that the Borrower, such Subsidiary or such
ERISA Affiliate is required or proposes to take, together with any notices
(required, proposed or otherwise) given to or filed with or by the Borrower,
such Subsidiary, such ERISA Affiliate, the PBGC, a Plan participant (other
than notices relating to an individual participant's benefits) or the Plan
administrator with respect thereto: that a Reportable Event has occurred;
that an accumulated funding deficiency has been incurred or an application is
to be made to the Secretary of the Treasury for a waiver or modification of
the minimum funding standard (including any required installment payments) or
an extension of any amortization period under Section 412 of the Code with
respect to a Plan; that a Plan having an Unfunded Current Liability has been
or is to be terminated, reorganized, partitioned or declared insolvent under
Title IV of ERISA (including the giving of written notice thereof); that a
Plan has an Unfunded Current Liability that has or will result in a lien
under ERISA or the Code; that proceedings will be or have been instituted to
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terminate a Plan having an Unfunded Current Liability (including the giving
of written notice thereof); that a proceeding has been instituted against the
Borrower, a Subsidiary or an ERISA Affiliate pursuant to Section 515 of ERISA
to collect a delinquent contribution to a Plan; that the PBGC has notified
the Borrower, any Subsidiary or any ERISA Affiliate of its intention to appoint
a trustee to administer any Plan; that the Borrower, any Subsidiary or any
ERISA Affiliate has failed to make a required installment or other payment
pursuant to Section 412 of the Code with respect to a Plan; or that the
Borrower, any Subsidiary or any ERISA Affiliate has incurred or will incur
(or has been notified in writing that it will incur) any liability (including
any contingent or secondary liability) to or on account of a Plan pursuant to
Section 409, 502(i), 502(l), 515, 4062, 4063, 4064, 4069, 4201 or 4204 of
ERISA or Section 4971 or 4975 of the Code.
9.8 Good Repair. The Borrower will, and will cause each of its
Subsidiaries to, ensure that its properties and equipment used or useful in
its business in whomsoever's possession they may be to the extent that it is
within the Borrower's or such Subsidiary's control to cause same, are kept in
good repair, working order and condition, normal wear and tear excepted, and
that from time to time there are made in such properties and equipment all
needful and proper repairs, renewals, replacements, extensions, additions,
betterments and improvements thereto, to the extent and in the manner
customary for companies in similar businesses and consistent with third party
leases, except in each case to the extent the failure to do so could not be
reasonably expected to have a Material Adverse Effect.
9.9 Transactions with Affiliates. The Borrower will conduct, and
cause each of its Subsidiaries to conduct, all transactions with any of its
Affiliates on terms that are substantially as favorable to the Borrower or
such Subsidiary as it would obtain in a comparable arm's-length transaction
with a Person that is not an Affiliate, provided that the foregoing
restrictions shall not apply to (a) customary fees paid to members of the
Board of Directors of the Borrower and its Subsidiaries, (b) transactions
permitted by Section 10.6 and (c) arrangements with Borden and its
Subsidiaries relating to the provision of administrative, legal and
management services to the Borrower in accordance with past practice.
9.10 Use of Proceeds and Letters of Credit. The proceeds of the
Revolving Credit Loans will be used by the Borrower and its Subsidiaries only
for working capital and for other general corporate purposes. Letters of
Credit will be used for general corporate purposes of the Borrower and its
Subsidiaries.
9.11 Changes in Business. The Borrower and its Subsidiaries taken
as a whole will not fundamentally and substantively alter the character of
their business taken as a whole from the business conducted by the Borrower
and its Subsidiaries taken as a whole on the date hereof and other business
activities incidental or related to any of the foregoing.
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9.12 Information Regarding Collateral. The Borrower will furnish
to the Administrative Agent prompt written notice of any change (i) in the
Borrower's or a Subsidiary's corporate name or in any trade name used to
identify it in the conduct of its business or in the ownership of its
properties, (ii) in the location of the Borrower's or a Subsidiary's chief
executive office, its principal place of business or any asset constituting
Collateral (including the relocation of any asset constituting Collateral to
a location where Collateral has not previously been located), (iii) in the
Borrower's or a Subsidiary's identity or corporate structure or (iv) in the
Borrower's or a Subsidiary's Federal Taxpayer Identification Number. The
Borrower agrees not to effect or permit any change referred to in the
preceding sentence unless all filings have been made under the Uniform
Commercial Code or otherwise that are required in order for the
Administrative Agent to continue at all times following such change to have a
valid, legal and perfected security interest in all the Collateral. The
Borrower also agrees promptly to notify the Administrative Agent if any
material portion of the Collateral is damaged or destroyed.
9.13 Additional Subsidiaries. If any additional Subsidiary is
formed or acquired after the Closing Date, the Borrower will notify the
Administrative Agent and the Lenders thereof and will cause such Subsidiary
to become a party to the Security Agreement promptly, and in any event within
five Business Days, thereafter.
9.14 Further Assurances. The Borrower will, and will cause each
Subsidiary to, execute any and all further documents, financing statements,
agreements and instruments, and take all such further actions (including the
filing and recording of financing statements, fixture filings and other
documents), which may be required under any applicable law, or which the
Administrative Agent or the Required Lenders may reasonably request, to grant,
preserve, protect or perfect the Liens created or intended to be created by
the Security Documents or the validity or priority of any such Lien, all at
the expense of the Borrower. The Borrower also agrees to provide to the
Administrative Agent, upon request, evidence reasonably satisfactory to the
Administrative Agent as to the perfection and priority of the Liens created or
intended to be created by the Security Documents.
9.15 Perfection Date. (a) The Borrower shall use its reasonable
best efforts to satisfy the conditions set forth in Section 6.2 as promptly as
practicable after the Closing Date.
(b) If for any reason the conditions set forth in Section 6.2
cannot be satisfied with respect to the Specified Mortgaged Property, then the
Borrower will use its reasonable best efforts to designate an alternate
property or properties as the Mortgaged Property that (i) is capable of
satisfying such conditions and (ii) is otherwise satisfactory to the Required
Lenders.
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9.16 UCC Searches. On or prior to January 31, 1999, the Borrower
will deliver, or cause to be delivered, to the Administrative Agent (a) the
results of a search of Uniform Commercial Code (or equivalent) filings made
with respect to the Borrower and its Subsidiaries in the jurisdictions
contemplated by the Perfection Certificate and (b) copies of the financing
statements (or similar documents) disclosed by such search. If such search
results disclose any Liens on any Collateral (other than Permitted Collateral
Liens), then the Borrower shall, within 20 days after receipt of notice
thereof, deliver to the Administrative Agent evidence reasonably satisfactory
to the Administrative Agent that such Liens have been released.
9.17 Borden Set-Off Agreement. Within 30 days after the Closing
Date, the Borrower shall enter into an agreement with Borden pursuant to
which Borden will agree not to exercise any rights of set-off with respect to
any Accounts Receivable (as defined in the Security Agreement), on such terms
as shall be reasonably satisfactory to the Administrative Agent. The Borrower
shall deliver copies of such agreement to the Administrative Agent and the
Lenders promptly after the execution thereof.
9.18 Engagement Letters. Within 30 days after the Closing Date,
the Borrower shall enter into, and deliver to the Administrative Agent and
the Lenders copies of, one or more executed engagement letters pursuant to
which the Borrower shall retain Salomon Smith Barney and Evercore Partners to
pursue strategic alternatives with respect to the Borrower (including a sale
of the Borrower).
SECTION 10. Negative Covenants. The Borrower hereby covenants and
agrees that on the Closing Date and thereafter, for so long as this Agreement
is in effect and until the Revolving Credit Commitments, the Swingline
Commitment and each Letter of Credit have terminated and the Loans and Unpaid
Drawings, together with interest, Fees and all other Obligations incurred
hereunder, are paid in full:
10.1 Limitation on Indebtedness; Preferred and Redeemable
Interests. (a) The Borrower will not, and will not permit any of its
Subsidiaries to, create, incur, assume or suffer to exist any Indebtedness,
except:
(b) Indebtedness arising under the Credit Documents; (i)
Indebtedness of (i) the Borrower to any Subsidiary of the Borrower
and (ii) Indebtedness of any Subsidiary to the Borrower or any other
Subsidiary of the Borrower; (iii) [intentionally omitted]; (iv) except as
provided in clauses (ix) and (x) below, Guarantee Obligations
incurred by the Borrower or any Subsidiary Guarantor in respect of
Indebtedness of the Subsidiaries that is permitted to be incurred
under this Agreement; (v) Guarantee Obligations incurred in
the ordinary course of business in respect of obligations of
suppliers, customers, franchisees, lessors and licensees; (vi)] (A)
Indebtedness (including Indebtedness arising under Capital Leases)
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incurred within 270 days of the acquisition, construction or
improvement of fixed or capital assets to finance the acquisition,
construction or improvement of such fixed or capital assets and (B)
Indebtedness arising under Capital Leases, other than Capital Leases
in effect on the date hereof and Capital Leases entered into pursuant
to subclause (A) above, provided that the aggregate amount of
Indebtedness incurred pursuant to this subclause (B) that is
attributable to Capital Leases resulting from sale and leaseback
transactions shall be deemed to have been incurred pursuant to
clause (xii) below for purposes of determining compliance with such
clause (xii), and (C) any refinancing, refunding, renewal or
extension of any Indebtedness specified in subclause (A) or (B)
above, provided that the principal amount thereof is not increased
above the principal amount thereof outstanding immediately prior to
such refinancing, refunding, renewal or extension; (vii) the 9.50% Notes
and other Indebtedness outstanding on the date hereof and listed on
Schedule 10.1 and any refinancing, refunding, renewal or extension
thereof, provide that (A) the principal amount thereof is not
increased above the principal amount thereof outstanding immediately
prior to such refinancing, refunding, renewal or extension, except to
the extent otherwise permitted hereunder, and (B) the direct and
contingent obligors with respect to such Indebtedness are not changed;
(viii) Indebtedness in respect of Hedge Agreements entered into to hedge
or mitigate interest rate or currency risks to which the Borrower or its
Subsidiaries are exposed in the ordinary course of their business; (ix)
(A) Indebtedness of a Person or attaching to assets of a Person that,
in either case, becomes a Subsidiary, or Indebtedness attaching to
assets that are acquired by the Borrower or any Subsidiary, in each
case after the Closing Date as the result of a Permitted Acquisition,
provide that (w) such Indebtedness existed at the time such Person
became a Subsidiary or at the time such assets were acquired and,
in each case, was not created in anticipation thereof, (x) such
Indebtedness is not guaranteed in any respect by the Borrower or any
Subsidiary (other than any Person acquired (the "acquired Person") as
a result of such Permitted Acquisition or any Subsidiary created solely
for the purpose of consummating such Permitted Acquisition), and (y) if
the pro forma Senior Debt Ratio recomputed as at the last day of the
most recently ended Test Period as if such Permitted Acquisition had
occurred on the first day of such Test Period is not less than 3.25 to
1.0, then the aggregate amount of such Indebtedness and all Indebtedness
incurred under clause (x) below, when taken together, does not exceed
$100,000,000 in the aggregate at any time outstanding, and (B) any
refinancing, refunding, renewal or extension of any Indebtedness
specified in subclause (A) above, provided that, except to the extent
otherwise permitted hereunder, (I) the principal amount of any such
Indebtedness is not increased above the principal amount thereof
outstanding immediately prior to such refinancing, refunding, renewal
or extension and (II) the direct and contingent obligors with respect
to such Indebtedness are not changed; (x) (A) Indebtedness of the Borrower
or any Subsidiary incurred to finance a Permitted Acquisition,
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provided that (x) such Indebtedness is not guaranteed in any
respect by any Subsidiary (other than any acquired Person or
any Subsidiary created solely for the purpose of consummating such
Permitted Acquisition) or, in the case of Indebtedness of any
Subsidiary, by the Borrower, and (y) if the pro forma Senior Debt
Ratio recomputed as at the last day of the most recently ended
Test Period as if such Permitted Acquisition had occurred on
the first day of such Test Period is not less than 3.25 to
1.0, then the aggregate amount of such Indebtedness and all
Indebtedness incurred under clause (ix) above, when taken together,
does not exceed $100,000,000 in the aggregate at any time
outstanding, and (B) any refinancing, refunding, renewal or
extension of any Indebtedness specified in subclause (A) above,
provided that (I) the principal amount of any such Indebtedness is
not increased above the principal amount thereof outstanding
immediately prior to such refinancing, refunding, renewal or
extension and (II) the direct and contingent obligors with respect
to such Indebtedness are not changed, except to the extent
otherwise permitted hereunder; Permitted Subordinated
Indebtedness; and additional unsecured Indebtedness in an
aggregate principal amount at any time outstanding not exceeding
$5,000,000.
(c) The Borrower will not permit any of its Subsidiaries
(other than any Subsidiary Guarantors) to create, incur, assume or
suffer to exist any Indebtedness (regardless of whether such
Indebtedness would otherwise be permitted under paragraph (a) of
this Section 10.1), except (i) Indebtedness of Subsidiaries (other
than any Subsidiary Guarantors) permitted under clauses (ii),
(iii), (v), (vii), (viii), (ix) and (x) of paragraph (a) of this
Section 10.1, (ii) Indebtedness of Subsidiaries (other than any
Subsidiary Guarantors) permitted under clause (vi) of paragraph (a)
of this Section 10.1 in an aggregate principal amount not exceeding
$15,000,000 at any time outstanding and (iii) Indebtedness of
Subsidiaries (other than any Subsidiary Guarantors) otherwise
permitted under paragraph (a) of this Section 10.1 in an aggregate
principal amount not exceeding $5,000,000 at any time outstanding.
(d) The Borrower will not, and will not permit any of its
Subsidiaries to, create, issue or suffer to exist any Preferred
Stock or any Redeemable Stock, except (i) Preferred Stock issued by
the Borrower, (ii) Redeemable Stock issued by the Borrower or a
Subsidiary that is treated as Indebtedness of the Borrower or such
Subsidiary, as the case may be, for purposes of determining
compliance with paragraphs (a) and (b) of this Section 10.1 and
(iii) any such Preferred Stock or Redeemable Stock issued by a
Subsidiary that is owned by the Borrower.
10.2 Limitation on Liens. The Borrower will not, and will not
permit any of its Subsidiaries to, create, incur, assume or suffer to exist
any Lien upon any property or assets of any kind (real or personal, tangible
or intangible) of the Borrower or any Subsidiary, whether now owned or
hereafter acquired, except:
(a) Liens arising under the Credit Documents;
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(b) Permitted Liens;
(c) Liens securing Indebtedness permitted pursuant to
Section 10.1(a)(vi), provided that such Liens attach at all times
only to the assets so financed;
(d) Liens existing on the date hereof;
(e) Liens existing on the assets of any Person that
becomes a Subsidiary, or existing on assets acquired, pursuant to a
Permitted Acquisition to the extent the Liens on such assets secure
Indebtedness permitted by Section 10.1(a)(ix), provided that such
Liens attach at all times only to the same assets that such Liens
attached to, and secure only the same Indebtedness that such Liens
secured, immediately prior to such Permitted Acquisition;
(f) (i) Liens placed upon the capital stock of any
Subsidiary acquired pursuant to a Permitted Acquisition to secure
Indebtedness of the Borrower or any other Subsidiary incurred
pursuant to Section 10.1(a)(x) in connection with such Permitted
Acquisition, (ii) Liens placed upon the assets of such Subsidiary
to secure a guarantee by such Subsidiary of any such Indebtedness
of the Borrower or any other Subsidiary and (iii) Liens placed upon
the capital stock or assets of any Subsidiary to secure
Indebtedness of such Subsidiary incurred pursuant to Section
10.1(a)(x) in connection with any Permitted Acquisition;
(g) the replacement, extension or renewal of any Lien
permitted by clauses (a) through (f) above upon or in the same
assets theretofore subject to such Lien or the replacement,
extension or renewal (without increase in the amount or change in
any direct or contingent obligor) of the Indebtedness secured
thereby; and
(h) additional Liens so long as the aggregate principal
amount of the obligations so secured does not exceed $1,000,000 at
any time outstanding.
Notwithstanding the foregoing, the Borrower will not, and will not permit any
of its Subsidiaries to, create, incur, assume or suffer to exist any Lien upon
any Collateral other than the Liens granted under the Security Agreement and
Permitted Collateral Liens.
10.3 Limitation on Fundamental Changes. Except as expressly
permitted by Section 10.4 or 10.5, the Borrower will not, and will not permit
any of its Subsidiaries to, enter into any merger, consolidation or
amalgamation, or liquidate, wind up or dissolve itself (or suffer any
liquidation or dissolution), or convey, sell, lease, assign, transfer or
otherwise dispose of, all or substantially all its business units, assets or
other properties, except that:
(a) any Subsidiary of the Borrower or any other Person
may be merged or consolidated with or into the Borrower, provided
that (i) the Borrower shall be the continuing or surviving entity
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or the Person formed by or surviving any such merger or
consolidation (if other than the Borrower) shall be a limited
partnership organized or existing under the laws of the United
States, any state thereof, the District of Columbia or any
territory thereof (the Borrower or such Person, as the case may be,
being herein referred to as the "Successor Borrower"), (ii) the
Successor Borrower (if other than the Borrower) shall expressly
assume all the obligations of the Borrower under this Agreement and
the other Credit Documents pursuant to a supplement hereto or
thereto in form reasonably satisfactory to the Administrative
Agent, (iii) no Default or Event of Default would result from the
consummation of such merger or consolidation, (iv) the Successor
Borrower shall be in compliance, on a pro forma basis after giving
effect to such merger or consolidation, with the covenants set
forth in Sections 10.8 and 10.9 as such covenants are recomputed as
at the last day of the most recently ended Test Period under such
Section as if such merger or consolidation had occurred on the
first day of such Test Period, and (v) the Borrower shall have
delivered to the Administrative Agent an officer's certificate and
an opinion of counsel, each stating that such merger or
consolidation comply with this Agreement, provided further that if
the foregoing are satisfied, the Successor Borrower (if other than
the Borrower) will succeed to, and be substituted for, the Borrower
under this Agreement;
(b) any Subsidiary of the Borrower or any other Person
may be merged or consolidated with or into any one or more
Subsidiaries of the Borrower, provided that (i) no Default or Event
of Default would result from the consummation of such merger or
consolidation, (ii) the Borrower shall be in compliance, on a pro
forma basis after giving effect to such merger or consolidation,
with the covenants set forth in Sections 10.8 and 10.9, as such
covenants are recomputed as at the last day of the most recently
ended Test Period under such Section as if such merger or
consolidation had occurred on the first day of such Test Period,
and (iii) the Borrower shall have delivered to the Administrative
Agent an Officers' Certificate stating that such merger or
consolidation comply with this Agreement; and
(c) any Subsidiary may sell, lease, transfer or
otherwise dispose of any or all of its assets (upon voluntary
liquidation or otherwise) to the Borrower, or any other Subsidiary
of the Borrower.
10.4 Limitation on Sale of Assets. The Borrower will not, and
will not permit any of its Subsidiaries to, (i) convey, sell, lease, assign,
transfer or otherwise dispose of any of its property, business or assets
(including, without limitation, receivables and leasehold interests), whether
now owned or hereafter acquired (other than any such sale, transfer,
assignment or other disposition resulting from any casualty or condemnation of
any assets of the Borrower or its Subsidiaries) or (ii) sell any shares owned
by it of any Subsidiary's capital stock to any Person other than the Borrower,
except that:
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(a) the Borrower and its Subsidiaries may sell, transfer
or otherwise dispose of used or surplus equipment, vehicles,
inventory and other assets in the ordinary course of business;
(b) the Borrower and its Subsidiaries may sell, transfer
or otherwise dispose of other assets for fair value, provided that
(i) after giving effect to such sale, transfer or disposition, the
aggregate amount of all such sales, transfers and disposals by the
Borrower and its Subsidiaries taken as a whole pursuant to this
clause (b) during the term of this Agreement (excluding sales,
transfers and dispositions that are to be disregarded pursuant to
the proviso appearing at the end of this clause (b)) shall not in
the aggregate exceed an amount equal to 10% of the consolidated
total assets of the Borrower and its Subsidiaries as of the end of
the most recent Test Period for which financial statements have
been delivered pursuant to Section 9.1, (ii) with respect to any
such sale, transfer or disposition (or series of related sales,
transfers or dispositions) in an aggregate amount in excess of
$10,000,000, the Borrower shall be in compliance, on a pro forma
basis after giving effect to such sale, transfer or disposition,
with the covenants set forth in Section 10.9 as such covenants are
recomputed as at the last day of the most recently ended Test
Period under such Sections as if such sale, transfer or disposition
had occurred on the first day of such Test Period, and (iii) after
giving effect to any such sale, transfer or disposition, no Default
or Event of Default shall have occurred and be continuing; provided
further that the Borrower and its Subsidiaries may sell, transfer
or otherwise dispose of assets in excess of the amount otherwise
permitted by clause (i) above if prior to consummation of such
sale, transfer or disposition the Borrower shall certify to the
Administrative Agent that the net cash proceeds from such sale,
transfer or disposition (to the extent not required to be applied
to prepay Loans under Section 5.2(b)) will be applied within 180
days after the date of such sale, transfer or disposition to
acquire assets (or to make improvements to existing assets) to be used
in the business of the Borrower and its Subsidiaries and, provided that
such net cash proceeds are so applied, such sale, transfer or disposition
shall be disregarded for purposes of determining compliance with clause
(i) above;
(c) the Borrower and its Subsidiaries may make sales of
assets to the Borrower or to any Subsidiary;
(d) any Subsidiary may effect any transaction permitted
by Section 10.3; and
(e) in addition to selling or transferring accounts
receivable pursuant to the other provisions hereof, the Borrower
and its Subsidiaries may compromise, compound or settle, or allow
credits or discounts of, accounts receivable, in each case subject
to Section 4.10 of the Security Agreement.
10.5 Limitation on Investments. The Borrower will not, and
will not permit any of its Subsidiaries to, make any advance, loan, extensions
of credit or capital contribution to, or purchase any stock, bonds, notes,
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debentures or other securities of or any assets of, or make any other
investment in, any Person, except:
(a) extensions of trade credit and asset purchases in
the ordinary course of business;
(b) Permitted Investments;
(c) loans and advances to officers, directors and
employees of the Borrower or any of its Subsidiaries (i) to finance
the purchase of limited partnership interests of the Borrower and
(ii) for additional purposes not contemplated by subclause (i)
above, in an aggregate principal amount at any time outstanding
with respect to clause (i) and (ii) not exceeding $1,000,000;
(d) subject to Section 10.10, investments existing on
the date hereof and any extensions, renewals or reinvestments
thereof, so long as the aggregate amount of all investments
pursuant to this clause (d) is not increased at any time above the
amount of such investments existing on the date hereof;
(e) investments in Hedge Agreements permitted by Section
10.1(a)(viii);
(f) investments received in connection with the
bankruptcy or reorganization of suppliers or customers and in
settlement of delinquent obligations of, and other disputes with,
customers arising in the ordinary course of business;
(g) investments to the extent that payment for such
investments is made solely with limited partnership interests in
the Borrower;
(h) investments constituting non-cash proceeds of sales,
transfers and other dispositions of assets to the extent permitted
by Section 10.4;
(i) investments constituting Permitted Acquisitions;
(j) investments in Subsidiary Guarantors; and
(k) additional investments in an aggregate amount at the
time of such investment not in excess of $2,000,000.
10.6 Limitation on Restricted Payments. (a) The Borrower will
not directly or indirectly, (i) declare or pay any partnership distributions
or dividends (other than partnership distributions or dividends payable
solely in its Capital Stock or rights, warrants or options to purchase its
Capital Stock) or return any capital to its partners or stockholders or make
any other distribution, payment or delivery of property or cash to its
partners or stockholders as such, or (ii) redeem, retire, purchase or
otherwise acquire, directly or indirectly, for consideration, any partnership
interests or shares of any class of its Capital Stock or the Capital Stock of
any direct or indirect parent of the Borrower now or
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hereafter outstanding (or any warrants for or options or stock appreciation
rights in respect of any of such partnership interests or shares), or (iii)
permit any of its Subsidiaries to purchase or otherwise acquire for
consideration (other than in connection with an investment permitted by
Section 10.5) any partnership interests or shares of any class of the Capital
Stock of the Borrower, now or hereafter outstanding (or any options or
warrants or stock appreciation rights issued by such Person with respect to
its Capital Stock), or (iv) repay, prepay, redeem, retire, defease, purchase
or otherwise acquire, directly or indirectly, for consideration (other than
scheduled repayments as and when due and not otherwise prohibited by
applicable subordination provisions) any Permitted Subordinated Indebtedness
(or permit any of its Subsidiaries to do any of the foregoing), or (v) set
aside any funds for any of the foregoing purposes (all of the foregoing
"Restricted Payments") unless, at the time of such Restricted Payment and
after giving effect thereto:
(A) no Default or Event of Default shall have occurred
and be continuing;
(B) so long as such restrictions remain in the Note
Indenture, (i) the Consolidated EBITDA Coverage Ratio (as such
term is defined in the Note Indenture) exceeds 3.0 to 1.0 and
(ii) Consolidated Total Debt (as such term is defined in the
Note Indenture) does not exceed 60% of Consolidated Net
Tangible Assets (as such term is defined in the Note
Indenture) on a pro forma basis as of the end of the most
recently completed fiscal quarter ending at least 45 days
prior to the date on which such Restricted Payment is made;
and
(C) from and after such time as the restrictions set
forth in clause (B) above are no longer in the Note Indenture,
the Consolidated EBITDA Coverage Ratio (as defined herein)
exceeds 2.75 to 1.0.
(b) The provisions of this Section shall not prohibit:
(i) any purchase, redemption, repurchase, defeasance,
other acquisition or retirement (a "purchase or redemption")
of Capital Stock or Permitted Subordinated Indebtedness of the
Borrower made by exchange for, or out of the proceeds of the
substantially concurrent sale (other than to a Subsidiary) of,
Capital Stock of the Borrower (other than Disqualified Capital
Stock);
(ii) any purchase or redemption of Permitted Subordinated
Indebtedness of the Borrower made by exchange of, or out of
the proceeds of the substantially concurrent sale (other than
to a Subsidiary) of, Permitted Subordinated Indebtedness of
the Borrower; and
(iii) partnership distributions or dividends paid
within 60 days after the date of declaration thereof if at
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such date of declaration such partnership distribution
dividend would have complied with this provision; provided,
however, that at the time of payment of such partnership
distribution dividend, no further Default or Event of Default
shall have occurred and be continuing (or would result
therefrom); provided further, however, that such partnership
distribution dividend shall be included (when paid, but not
declared) in the calculation of the amount of Restricted
Payments.
10.7 Limitations on Certain Amendments. The Borrower will not
waive, amend, modify, terminate or release the Note Indenture or any
indenture or other agreement or instrument governing or evidencing any
Permitted Subordinated Indebtedness, to the extent that any such waiver,
amendment, supplement, modification, termination or release would be adverse
to the Lenders in any material respect.
10.8 Capital Expenditures. The Borrower will not permit the
aggregate amount of Capital Expenditures made by the Borrower and the
Subsidiaries to exceed $20,000,000 in each of the fiscal years ended
December 31, 1999 and December 31, 2000.
10.9 Consolidated EBITDA Coverage Ratio. The Borrower will not
permit the Consolidated EBITDA Coverage Ratio for the Test Period ending on
any date set forth below to be less than the ratio set forth below opposite
such date:
Date Ratio
December 31, 1998 0.60 to 1.0
March 31, 1999 0.40 to 1.0
June 30, 1999 0.40 to 1.0
September 30, 1999 0.40 to 1.0
December 31, 1999 1.00 to 1.0
March 31, 2000 1.25 to 1.0
June 30, 2000 1.50 to 1.0
September 30, 2000 1.90 to 1.0
December 31, 2000 2.20 to 1.0
10.10 Cash Management. The Borrower will not permit the aggregate
cash balances (including Permitted Investments and any other cash equivalents)
of the Borrower and its Subsidiaries at any time to exceed the sum (without
duplication in the case of clauses (i) and (ii)) of (i) the amount of any cash
collateral deposit that the Borrower is required to maintain at such time with
the Lender that is performing cash management services for the Borrower to
cover credit exposures related to such services plus (ii) the amount of cash
that the Borrower is required to deposit with such Lender referred to in
clause (i) above to cover wire transfers and check payments, plus (iii)
$5,000,000. The Borrower also will not permit any of the cash balances
(including Permitted Investments and any other cash equivalents) of the
Borrower or any of its Subsidiaries to be deposited or maintained with or
held by any bank or other Person other than one or more of the Lenders.
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SECTION 11. Events of Default. Upon the occurrence of any of the
following specified events (each an "Event of Default"):
11.1 Payments. The Borrower shall (a) default in the payment when
due of any principal of the Loans or (b) default, and such default shall
continue for five or more days, in the payment when due of any interest on the
Loans or any Fees or any Unpaid Drawings or of any other amounts owing
hereunder or under any other Credit Document; or
11.2 Representations, etc. Any representation, warranty or statement
made or deemed made by the Borrower or any Subsidiary herein or in any other
Credit Document or in any certificate delivered or required to be delivered
pursuant hereto or thereto shall prove to be untrue in any material respect on
the date as of which made or deemed made; or
11.3 Covenants. The Borrower or any Subsidiary shall (a) default in
the due performance or observance by it of any term, covenant or agreement
contained in Section 9.1(d), Section 9.16 or Section 10 or (b) default in the
due performance or observance by it of any term, covenant or agreement (other
than those referred to in Section 11.1 or 11.2 or clause (a) of this Section
11.3) contained in this Agreement or any other Credit Document and such default
shall continue unremedied for a period of at least 30 days after receipt of
written notice by the Borrower from the Administrative Agent or the Required
Lenders; or
11.4 Default Under Other Agreements. The Borrower or any of its
Subsidiaries shall (i) default in any payment with respect to any Indebtedness
(other than the Obligations) in excess of $20,000,000 in the aggregate, for
the Borrower and such Subsidiaries, beyond the period of grace, if any,
provided in the instrument or agreement under which such Indebtedness was
created or (ii) default in the observance or performance of any agreement or
condition relating to any such Indebtedness or contained in any instrument or
agreement evidencing, securing or relating thereto, or (except in the case of
Indebtedness consisting of any Hedge Agreement) any other event shall occur or
condition exist, the effect of which default or other event or condition is to
cause, or to permit the holder or holders of such Indebtedness (or a trustee
or agent on behalf of such holder or holders) to cause, any such Indebtedness
to become due prior to its stated maturity; or (b) without limiting the
provisions of clause (a) above, any such Indebtedness (other than Indebtedness
consisting of any Hedge Agreement) shall be declared to be due and payable, or
required to be prepaid other than by a regularly scheduled required prepayment
or as a mandatory prepayment, prior to the stated maturity thereof; or
11.5 Bankruptcy, etc. The Borrower or any Subsidiary shall commence
a voluntary case concerning itself under Title 11 of the United States Code
entitled "Bankruptcy," as now or hereafter in effect, or any successor thereto
(the "Bankruptcy Code"); or an involuntary case is commenced against the
Borrower or any Subsidiary and the petition is not controverted within 10 days
after commencement of the case; or an involuntary case is commenced against the
Borrower or any Subsidiary and the petition is not dismissed within 60 days
after commencement of the case; or a custodian (as defined in the Bankruptcy
Code) is appointed for, or takes charge of, all or substantially all of the
property of the Borrower or any Subsidiary; or the Borrower or any Subsidiary
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commences any other proceeding under any reorganization, arrangement adjustment
of debt, relief of debtors, dissolution, insolvency or liquidation or similar
law of any jurisdiction whether now or hereafter in effect relating to the
Borrower or any Subsidiary; or there is commenced against the Borrower or any
Subsidiary any such proceeding that remains undismissed for a period of 60
days; or the Borrower or any Subsidiary is adjudicated insolvent or bankrupt;
or any order of relief or other order approving any such case or proceeding is
entered; or the Borrower or any Subsidiary suffers any appointment of any
custodian or the like for it or any substantial part of its property to
continue undischarged or unstayed for a period of 60 days; or the Borrower or
any Subsidiary makes a general assignment for the benefit of creditors; or any
corporate action is taken by the Borrower or any Subsidiary for the purpose of
effecting any of the foregoing; or
11.6 ERISA. (a) Any Plan shall fail to satisfy the minimum funding
standard required for any plan year or part thereof or a waiver of such
standard or extension of any amortization period is sought or granted under
Section 412 of the Code; any Plan is or shall have been terminated or is the]
subject of termination proceedings under ERISA (including the giving of written
notice thereof); an event shall have occurred or a condition shall exist in
either case entitling the PBGC to terminate any Plan or to appoint a trustee
to administer any Plan (including the giving of written notice thereof); any
Plan shall have an accumulated funding deficiency (whether or not waived); the
Borrower or any Subsidiary or any ERISA Affiliate has incurred or is likely to
incur a liability to or on account of a Plan under Section 409, 502(i), 502(l),
515, 4062, 4063, 4064, 4069, 4201 or 4204 of ERISA or Section 4971 or 4975 of
the Code (including the giving of written notice thereof); (b) there could
result from any event or events set forth in clause (a) of this Section 11.6
the imposition of a lien, the granting of a security interest, or a liability,
or the reasonable likelihood of incurring a lien, security interest or
liability; and (c) such lien, security interest or liability will or would be
reasonably likely to have a Material Adverse Effect; or
11.7 Judgments. One or more judgments or decrees shall be entered
against the Borrower or any of its Subsidiaries involving a liability of
$10,000,000 or more in the aggregate for all such judgments and decrees for
the Borrower and its Subsidiaries (to the extent not paid or fully covered by
insurance provided by a carrier not disputing coverage) and any such judgments
or decrees shall not have been satisfied, vacated, discharged or stayed or
bonded pending appeal within 60 days from the entry thereof; or
11.8 Change of Control. A Change of Control shall occur; or
11.9 General Partner Agreement. The General Partner shall default
in the due performance or observance by it of any term, covenant or agreement
contained in the agreement referred to in Section 6.1(m); or
11.10 Collateral. The security interests granted under the Security
Agreement shall cease for any reason to constitute legal, valid and perfected
first-priority security interests in any material portion of the Collateral; or
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11.11 Perfection Date. The conditions set forth in Section 6.2
(other than paragraph (f) thereof) shall not be satisfied prior to
February 28, 1999 for any reason other than the failure of the Administrative
Agent to be satisfied with the Liens on the Specified Mortgaged Property
disclosed in the title report with respect thereto, the environmental
exposures related to the Specified Mortgaged Property or the value of the
Specified Mortgaged Property as collateral security;
then, and in any such event, and at any time thereafter, if any Event of
Default shall then be continuing, the Administrative Agent shall, upon the
written request of the Required Lenders, by written notice to the Borrower,
take any or all of the following actions, without prejudice to the rights of
the Administrative Agent or any Lender to enforce its claims against the
Borrower, except as otherwise specifically provided for in this Agreement
(provided that, if an Event of Default specified in Section 11.5 shall occur
with respect to the Borrower, the result that would occur upon the giving of
written notice by the Administrative Agent as specified in clauses (i), (ii)
and (iv) below shall occur automatically without the giving of any such
notice): (i) declare the Total Revolving Credit Commitment terminated,
whereupon the Revolving Credit Commitment and Swingline Commitment, if any, of
each Lender or Chase, as the case may be, shall forthwith terminate
immediately and any Fees theretofore accrued shall forthwith become due and
payable without any other notice of any kind; (ii) declare the principal of
and any accrued interest in respect of all Loans and all Obligations owing
hereunder to be, whereupon the same shall become, forthwith due and payable
without presentment, demand, protest or other notice of any kind, all of which
are hereby waived by the Borrower; (iii) terminate any Letter of Credit that
may be terminated in accordance with its terms; and/or (iv) direct the
Borrower to pay (and the Borrower agrees that upon receipt of such notice, or
upon the occurrence of an Event of Default specified in Section 11.5 with
respect to the Borrower, it will pay) to the Administrative Agent at the
Administrative Agent's office such additional amounts of cash, to be held as
security for the Borrower's reimbursement obligations for Drawings that may
subsequently occur thereunder, equal to the aggregate Stated Amount of all
Letters of Credit issued and then outstanding.
SECTION 12. The Administrative Agent.
12.1 Appointment. Each Lender hereby irrevocably designates and
appoints the Administrative Agent as the agent of such Lender under this
Agreement and the Security Documents, and each such Lender irrevocably
authorizes the Administrative Agent, in such capacity, to take such action on
its behalf under the provisions of this Agreement and the Security Documents
and to exercise such powers and perform such duties as are expressly delegated
to the Administrative Agent by the terms of this Agreement and the Security
Documents, together with such other powers as are reasonably incidental
thereto. Notwithstanding any provision to the contrary elsewhere in this
Agreement, the Administrative Agent shall not have any duties or
responsibilities, except those expressly set forth herein and the Security
Documents, or any fiduciary relationship with any Lender, and no implied
covenants, functions, responsibilities, duties, obligations or liabilities
shall be read into this Agreement or any Security Document or otherwise exist
against the Administrative Agent.
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12.2 Delegation of Duties. The Administrative Agent may execute any
of its duties under this Agreement or any Security Document by or through
agents or attorneys-in-fact and shall be entitled to advice of counsel
concerning all matters pertaining to such duties. The Administrative Agent
shall not be responsible for the negligence or misconduct of any agents or
attorneys-in-fact selected by it with reasonable care.
12.3 Exculpatory Provisions. Neither the Administrative Agent nor
any of its officers, directors, employees, agents, attorneys-in-fact or
Affiliates shall be (a) liable for any action lawfully taken or omitted to be
taken by it or such Person under or in connection with this Agreement or any
other Credit Document (except for its or such Person's own gross negligence or
willful misconduct) or (b) responsible in any manner to any of the Lenders for
any recitals, statements, representations or warranties made by the Borrower or
any officer thereof contained in this Agreement or in any certificate, report,
statement or other document referred to or provided for in, or received by the
Administrative Agent under or in connection with, this Agreement or any other
Credit Document or for the value, validity, effectiveness, genuineness,
enforceability or sufficiency of this Agreement or any other Credit Document or
for any failure of the Borrower to perform its obligations hereunder or
thereunder. The Administrative Agent shall not be under any obligation to any
Lender to ascertain or to inquire as to the observance or performance of any
of the agreements contained in, or conditions of, this Agreement or any other
Credit Document, or to inspect the properties, books or records of the
Borrower.
12.4 Reliance by Administrative Agent. The Administrative Agent
shall be entitled to rely, and shall be fully protected in relying, upon any
writing, resolution, notice, consent, certificate, affidavit, letter, telecopy,
telex or teletype message, statement, order or other document or conversation
believed by it to be genuine and correct and to have been signed, sent or made
by the proper Person or Persons and upon advice and statements of legal counsel
(including, without limitation, counsel to the Borrower), independent
accountants and other experts selected by the Administrative Agent. The
Administrative Agent may deem and treat the Lender specified in the Register
with respect to any amount owing hereunder as the Owner thereof for all
purposes unless a written notice of assignment, negotiation or transfer thereof
shall have been filed with the Administrative Agent. The Administrative Agent
shall be fully justified in failing or refusing to take any action under this
Agreement or any other Credit Document unless it shall first receive such
advice or concurrence of the Required Lenders as it deems appropriate or it
shall first be indemnified to its satisfaction by the Lenders against any and
all liability and expense that may be incurred by it by reason of taking or
continuing to take any such action. The Administrative Agent shall in all
cases be fully protected in acting, or in refraining from acting, under this
Agreement or any other Credit Document in accordance with a request of the
Required Lenders, and such request and any action taken or failure to act
pursuant thereto shall be binding upon all the Lenders and all future holders
of the Loans.
12.5 Notice of Default. The Administrative Agent shall not be deemed
to have knowledge or notice of the occurrence of any Default or Event of
Default hereunder unless the Administrative Agent has received notice from a
Lender or the Borrower referring to this Agreement, describing such Default or
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Event of Default and stating that such notice is a "notice of default". In the
event that the Administrative Agent receives such a notice, the Administrative
Agent shall give notice thereof to the Lenders. The Administrative Agent shall
take such action with respect to such Default or Event of Default as shall be
reasonably directed by the Required Lenders, provided that unless and until
the Administrative Agent shall have received such directions, the
Administrative Agent may (but shall not be obligated to) take such action, or
refrain from taking such action, with respect to such Default or Event of
Default as it shall deem advisable in the best interests of the Lenders (except
to the extent that this Agreement requires that such action be taken only with
the approval of the Required Lenders or each of the Lenders, as applicable).
12.6 Non-Reliance on Administrative Agent and Other Lenders. Each
Lender expressly acknowledges that neither the Administrative Agent nor any of
its officers, directors, employees, agents, attorneys-in-fact or Affiliates has
made any representations or warranties to it and that no act by the
Administrative Agent hereinafter taken, including any review of the affairs of
the Borrower, shall be deemed to constitute any representation or warranty by
the Administrative Agent to any Lender. Each Lender represents to the
Administrative Agent that it has, independently and without reliance upon the
Administrative Agent or any other Lender, and based on such documents and
information as it has deemed appropriate, made its own appraisal of and
investigation into the business, operations, property, financial and other
condition and creditworthiness of the Borrower and made its own decision to
make its Loans hereunder and enter into this Agreement. Each Lender also
represents that it will, independently and without reliance upon the
Administrative Agent or any other Lender, and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit analysis, appraisals and decisions in taking or not taking action under
this Agreement and the other Credit Documents, and to make such investigation
as it deems necessary to inform itself as to the business, operations,
property, financial and other condition and creditworthiness of the Borrower.
Except for notices, reports and other documents expressly required to be
furnished to the Lenders by the Administrative Agent hereunder, the
Administrative Agent shall not have any duty or responsibility to provide any
Lender with any credit or other information concerning the business, assets,
operations, properties, financial condition, prospects or creditworthiness of
the Borrower that may come into the possession of the Administrative Agent or
any of its officers, directors, employees, agents, attorneys-in-fact or
Affiliates.
12.7 Indemnification. The Lenders agree to indemnify the
Administrative Agent in its capacity as such (to the extent not reimbursed by
the Borrower and without limiting the obligation of the Borrower to do so),
ratably according to their respective portions of the Total Revolving Credit
Commitment in effect on the date on which indemnification is sought (or, if
indemnification is sought after the date upon which the Revolving Credit
Commitments shall have terminated and the Loans shall have been paid in full,
ratably in accordance with their respective portions of the Total Revolving
Credit Commitment in effect immediately prior to such date), from and against
any and all liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements of any kind whatsoever that
may at any time (including, without limitation, at any time following the
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payment of the Loans) be imposed on, incurred by or asserted against the
Administrative Agent in any way relating to or arising out of, the Revolving
Credit Commitments, this Agreement, any of the other Credit Documents or any
documents contemplated by or referred to herein or therein or the transactions
contemplated hereby or thereby or any action taken or omitted by the
Administrative Agent under or in connection with any of the foregoing, provided
that no Lender shall be liable for the payment of any portion of such
liabilities, obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses or disbursements resulting from the Administrative
Agent's gross negligence or willful misconduct. The agreements in this
Section 12.7 shall survive the payment of the Loans and all other amounts
payable hereunder.
12.8 Administrative Agent in Its Individual Capacity. The
Administrative Agent and its Affiliates may make loans to, accept deposits
from and generally engage in any kind of business with the Borrower as though
the Administrative Agent were not the Administrative Agent hereunder. With
respect to the Loans made by it, the Administrative Agent shall have the same
rights and powers under this Agreement as any Lender and may exercise the same
as though it were not the Administrative Agent, and the terms "Lender" and
"Lenders" shall include the Administrative Agent in its individual capacity.
12.9 Successor Agent. The Administrative Agent may resign as
Administrative Agent upon 20 days, prior written notice to the Lenders and the
Borrower. If the Administrative Agent shall resign as Administrative Agent
under this Agreement, then the Required Lenders shall appoint from among the
Lenders a successor agent for the Lenders, which successor agent shall be
approved by the Borrower (which approval shall not be unreasonably withheld),
whereupon such successor agent shall succeed to the rights, powers and duties
of the Administrative Agent, and the term "Administrative Agent" shall mean
such successor agent effective upon such appointment and approval, and the
former Administrative Agent's rights, powers and duties as Administrative Agent
shall be terminated, without any other or further act or deed on the part of
such former Administrative Agent or any of the parties to this Agreement or any
holders of the Loans. After any retiring Administrative Agent's resignation as
Administrative Agent, the provisions of this Section 12 shall inure to its
benefit as to any actions taken or omitted to be taken by it while it was
Administrative Agent under this Agreement.
SECTION 13. Miscellaneous.
13.1 Amendments and Waivers. Neither this Agreement nor any other
Credit Document, nor any terms hereof or thereof may be amended, supplemented
or modified except in accordance with the provisions of this Section 13.1. The
Required Lenders may, or, with the written consent of the Required Lenders, the
Administrative Agent may, from time to time, (a) enter into with the Borrower
written amendments, supplements or modifications hereto and to the other Credit
Documents for the purpose of adding any provisions to this Agreement or the
other Credit Documents or changing in any manner the rights of the Lenders or
of the Borrower hereunder or thereunder or (b) waive, on such terms and
conditions as the Required Lenders or the Administrative Agent, as the case
may be, may specify in such instrument, any of the requirements of this
Agreement or the other Credit Documents or any Default or Event of Default
and its consequences; provided, however, that no such waiver and no such
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amendment, supplement or modification shall directly (i) forgive any
portion of any Loan or extend the final scheduled maturity date of any Loan
or reduce the stated rate, or forgive any portion, or extend the date for the
payment, of any interest or fee payable hereunder (other than as a result of
waiving the applicability of any post-default increase in interest rates) or
extend the final expiration date of any Lender's Revolving Credit Commitment or
extend the final expiration date of any Letter of Credit beyond the L/C
Maturity Date or increase the aggregate amount of the Revolving Credit
Commitment of any Lender, in each case without the written consent of each
Lender directly and adversely affected thereby, or (ii) amend, modify or waive
any provision of this Section 13.1 or reduce the percentages specified in the
definition of the term "Required Lenders", or consent to the assignment or
transfer by the Borrower of its rights and obligations under any Credit
Document (except as permitted pursuant to Section 10.3), in each case without
the written consent of each Lender directly and adversely affected thereby, or
(iii) amend, modify or waive any provision of Section 12 without the written
consent of the then-current Administrative Agent, or (iv) amend, modify or
waive any provision of Section 3 without the written consent of the Letter of
Credit Issuer, or (v) amend, modify or waive any provisions hereof relating to
Swingline Loans without the written consent of Chase, or (vi) release all or
substantially all of the Collateral or the mortgaged Property from the Liens
of the Security Documents (other than as contemplated by the Security
Documents) without the written consent of each Lender. Any such waiver and any
such amendment, supplement or modification shall apply equally to each of the
affected Lenders and shall be binding upon the Borrower, such Lenders, the
Administrative Agent and all future holders of the affected Loans. In the case
of any waiver, the Borrower, the Lenders and the Administrative Agent shall be
restored to their former positions and rights hereunder and under the other
Credit Documents, and any Default or Event of Default waived shall be deemed
to be cured and not continuing, it being understood that no such waiver shall
extend to any subsequent or other Default or Event of Default or impair any
right consequent thereon.
13.2 Notices. All notices, requests and demands to or upon the
respective parties hereto to be effective shall be in writing (including by
facsimile transmission), and, unless otherwise expressly provided herein, shall
be deemed to have been duly given or made when delivered, or three days after
being deposited in the mail, postage prepaid, or, in the case of telecopy
notice, when received, addressed as follows in the case of the Borrower and the
Administrative Agent, and as set forth on Schedule 1.1 in the case of the other
parties hereto, or to such other address as may be hereafter notified by the
respective parties hereto:
The Borrower: Borden Chemicals and Plastics Operating
Limited Partnership
Highways 73 and 30
Geismaer, LA 70734
Attention: Chris Nagel
Fax: (504) 673-0672
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The Administrative Agent: The Chase Manhattan Bank
c/o Loan and Agency Services Group
One Chase Manhattan Plaza, Eighth Floor
New York, NY 10081
Attention: Sandra Miklave
Fax: (212) 552-5658
with a copy to:
The Chase Manhattan Bank
707 Travis Street
Houston, TX 77002
Attention: David Mills
Fax: (713) 216-6387
provided that any notice, request or demand to or upon the Administrative Agent
or the Lenders pursuant to Sections 2.3, 2.6, 2.9, 4.2 and 5.1 shall not be
effective until received.
13.3 No Waiver; Cumulative Remedies. No failure to exercise and no
delay in exercising, on the part of the Administrative Agent or any Lender, any
right, remedy, power or privilege hereunder or under the other Credit Documents
shall operate as a waiver thereof, nor shall any single or partial exercise of
any right, remedy, power or privilege hereunder preclude any other or further
exercise thereof or the exercise of any other right, remedy, power or
privilege. The rights, remedies, powers and privileges herein provided are
cumulative and not exclusive of any rights, remedies, powers and privileges
provided by law.
13.4 Survival of Representations and Warranties. All representations
and warranties made hereunder and in any document, certificate or statement
delivered pursuant hereto or in connection herewith shall survive the execution
and delivery of this Agreement and the making of the Loans hereunder.
13.5 Payment of Expenses and Taxes. The Borrower agrees (a) to pay
or reimburse each Lender and the Administrative Agent for all of its reasonable
and documented out-of-pocket costs and expenses incurred in connection with the
discussions with the Borrower regarding defaults under the Original Credit
Agreement prior to the Closing Date and the development, preparation and
execution of this Agreement and the other Credit Documents and any other
documents prepared in connection herewith or therewith, and the consummation
and, with respect to the Administrative Agent, administration of the
transactions contemplated hereby and thereby including, without limitation,
the reasonable fees, disbursements and other charges of counsel to each Lender
and of counsel to the Administrative Agent and, with respect to the
Administrative Agent, all fees and other charges with respect to any audit of
the Borrower's and its Subsidiaries assets (including, without limitation, the
fees and other charges of any appraiser) to the extent, in the case of such
fees and expenses incurred prior to the Closing Date, that reasonably detailed
invoices are presented to the Borrower with respect thereto, (b) to pay or
reimburse the Administrative Agent for all its reasonable out-of-pocket costs
and expenses incurred in connection with the development, preparation and
execution of, any amendment, supplement or modification to this Agreement and
the other Credit Documents and any other documents prepared in connection
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therewith, and the consummation and administration of the transactions
contemplated thereby, including, without limitation, the reasonable fees,
disbursements and other charges of counsel to the Administrative Agent, (c) to
pay or reimburse each Lender and the Administrative Agent for all its
reasonable and documented costs and expenses incurred in connection with the
enforcement or preservation of any rights under this Agreement, the other
Credit Documents and any such other documents, including, without limitation,
the reasonable fees, disbursements and other charges of counsel to each Lender
and of counsel to the Administrative Agent, (d) to pay, indemnify, and hold
harmless each Lender and the Administrative Agent from, any and all recording
and filing fees and any and all liabilities with respect to, or resulting from
any delay in paying, stamp, excise and other similar taxes, if any, that may
be payable or determined to be payable in connection with the execution and
delivery of, or consummation or administration of any of the transactions
contemplated by, or any amendment, supplement or modification of, or any
waiver or consent under or in respect of, this Agreement, the other Credit
Documents and any such other documents, and (e) to pay, indemnify, and hold
harmless each Lender and the Administrative Agent and their respective
directors, officers, employees, trustees and agents from and against any and
all other liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements of any kind or nature
whatsoever, including, without limitation, reasonable and documented fees,
disbursements and other charges of counsel, with respect to the execution,
delivery, enforcement, performance and administration of this Agreement, the
other Credit Documents and any such other documents, including, without
limitation, any of the foregoing relating to the violation of, noncompliance
with or liability under, any Environmental Law applicable to the operations of
the Borrower, any of its Subsidiaries or any of the Properties (all the
foregoing in this clause (d), collectively, the "indemnified liabilities"),
provided that the Borrower shall have no obligation hereunder to the
Administrative Agent or any Lender nor any of their respective directors,
officers, employees and agents with respect to indemnified liabilities arising
from (i) the gross negligence or willful misconduct of the party to be
indemnified or (ii) disputes among the Administrative Agent, the Lenders
and/or their transferees. Without limiting the foregoing, the Borrower hereby
releases any and all claims and causes of action that the Borrower may have
against the Administrative Agent or any Lender arising out of or relating to
the Original Credit Agreement or any act or failure to act thereunder prior to
the Closing Date. The agreements in this Section 13.5 shall survive repayment
of the Loans and all other amounts payable hereunder.
13.6 Successors and Assigns; Participations and Assignments.
(a) (i) This Agreement shall be binding upon and inure to the benefit of the
Borrower, the Lenders, the Administrative Agent and their respective successors
and assigns, except that the Borrower may not assign or transfer any of its
rights or obligations under this Agreement without the prior written consent
of each Lender.
(ii) Any Lender may, in the ordinary course of its
business and in accordance with applicable law, at any time sell to
one or more banks or other entities ("Participants") participating
interests in any Loan owing to such Lender, any Revolving Credit
Commitment of such Lender or any other interest of such Lender
hereunder and under the other Credit Documents (including to loan
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derivative counterparties in respect of swaps or similar
arrangements having the practical or economic effect thereof). In
the event of any such sale by a Lender of a participating interest
to a Participant, such Lender's obligations under this Agreement to
the other parties to this Agreement shall remain unchanged, such
Lender shall remain solely responsible for the performance thereof,
such Lender shall remain the holder of any such Loan for all
purposes under this Agreement and the other Credit Documents, and
the Borrower and the Administrative Agent shall continue to deal
solely and directly with such Lender in connection with such
Lender's rights and obligations under this Agreement and the other
Credit Documents. In no event shall any Participant under any such
participation have any right to approve any amendment or waiver of
any provision of any Credit Document, or any consent to any
departure by the Borrower therefrom, except to the extent that such
amendment, waiver or consent would directly forgive any principal
of any Loan or reduce the stated rate, or forgive any portion, or
postpone the date for the payment, of any interest or fee payable
hereunder (other than as a result of waiving the applicability of
any post-default increase in interest rates), or increase the
aggregate amount of the Revolving Credit Commitment of any Lender
or postpone the date of the final scheduled maturity of any Loan,
in each case to the extent subject to such participation. The
Borrower agrees that if amounts outstanding under this Agreement
are due or unpaid, or shall have been declared or shall have become
due and payable upon the occurrence of an Event of Default, each
Participant shall, to the maximum extent permitted by applicable
law, be deemed to have the right of setoff in respect of its
participating interest in amounts owing under this Agreement to the
same extent as if the amount of its participating interest were
owing directly to it as a Lender under this Agreement, provided
that, in purchasing such participating interest, such Participant
shall be deemed to have agreed to share with the Lenders the
proceeds thereof as provided in Section 13.8 as fully as if it were
a Lender hereunder. The Borrower also agrees that each Participant
shall be entitled to the benefits of Sections 2.10 and 2.11 with
respect to its participation in the Revolving Credit Commitments
and the Loans outstanding from time to time as if it were a Lender,
provided that no Participant shall be entitled to receive any
greater amount pursuant to any such Section 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.
(iii) Any Lender may, in the ordinary course of its
business and in accordance with applicable law, at any time and
from time to time assign to (i) any Lender or any Affiliate (with
the consent of the Borrower if any increased costs would result
therefrom) thereof, or (ii) with the consent of the Administrative
Agent (which shall not be unreasonably withheld), to any Eligible
Assignee pursuant to an assignment that will not result in such
Eligible Assignee holding more than 15% of the Total Revolving
Credit Commitment, or (iii) with the consent of the Borrower and
the Administrative Agent (which in each case shall not be
unreasonably withheld, it being understood that, without
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limitation, the Borrower shall have the right to withhold its
consent to any assignment if, in order for such assignment to
comply with applicable law, the Borrower would be required to
obtain the consent of, or make any filing or registration with, any
Governmental Authority), to an additional bank or fund that is
regularly engaged in making, purchasing or investing in loans or
securities or financial institution (any such assignee referred to
in clause (i), (ii) or (iii), an "Assignee") all or any part of its
rights and obligations under this Agreement and the other Credit
Documents pursuant to an Assignment and Acceptance, substantially
in the form of Exhibit D, executed by such Assignee, such assigning
Lender (and, in the case of an Assignee that is not then a Lender
or an Affiliate thereof, by the Borrower (unless the Assignee is an
Eligible Assignee pursuant to an assignment described in clause
(ii) above) and the Administrative Agent) and delivered to the
Administrative Agent for its acceptance and recording in the
Register, provided that, except in the case of an assignment of all
of a Lender's interests under this Agreement, unless otherwise
agreed to by the Borrower and the Administrative Agent, no such
assignment to an Assignee (other than any Lender or any Affiliate
thereof) shall be in an aggregate principal amount of less than
$5,000,000. Upon such execution, delivery, acceptance and recording,
from and after the effective date determined pursuant to such Assignment
and Acceptance, (x) the Assignee thereunder shall be a party hereto and,
to the extent provided in such Assignment and Acceptance, have the rights
and obligations of a Lender hereunder with a Revolving Credit
Commitment as set forth therein and (y) the assigning Lender
thereunder shall, to the extent provided in such Assignment and
Acceptance, be released from its obligations under this Agreement
(and, in the case of an Assignment and Acceptance covering all or
the remaining portion of an assigning Lender's rights and
obligations under this Agreement, such assigning Lender shall cease
to be a party hereto). Notwithstanding any provision of this
Agreement to the contrary, the consent of the Borrower shall not be
required for any assignment that occurs at any time when any of the
events described in Section 11.5 shall have occurred and be
continuing with respect to the Borrower.
(b) Nothing herein shall prohibit any Lender from
pledging or assigning all or any portion of its Loans to any
Federal Reserve Bank in accordance with applicable law. In order to
facilitate such pledge or assignment, the Borrower hereby agrees
that, upon request of any Lender at any time and from time to time
after the Borrower has made its initial borrowing hereunder, the
Borrower shall provide to such Lender, at the Borrower's own
expense, a promissory note, substantially in the form of Exhibit A,
evidencing the Revolving Credit Loans owing to such Lender.
(c) The Administrative Agent, on behalf of the Borrower,
shall maintain at the address of the Administrative Agent referred
to in Section 13.2 a copy of each Assignment and Acceptance
delivered to it and a register (the "Register") for the recordation
of the names and addresses of the Lenders and the Revolving Credit
Commitment of, and principal amount of the Loans owing to, each
Lender from time to time. The entries in the Register shall be
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conclusive, in the absence of manifest error, and the Borrower, the
Administrative Agent and the Lenders shall treat each Person whose
name is recorded in the Register as the owner of a Loan or other
obligation hereunder as the owner thereof for all purposes of this
Agreement and the other Credit Documents, notwithstanding any
notice to the contrary. Any assignment of any Loan or other
obligation hereunder shall be effective only upon appropriate
entries with respect thereto being made in the Register. The
Register shall be available for inspection by the Borrower or any
Lender at any reasonable time and from time to time upon reasonable
prior notice.
(d) Upon its receipt of an Assignment and Acceptance
executed by an assigning Lender and an Assignee (and, in the case
of an Assignee that is not then a Lender or an Affiliate thereof,
by the Borrower and the Administrative Agent) together with payment
to the Administrative Agent of a registration and processing fee of
$3,500, the Administrative Agent shall (i) promptly accept such
Assignment and Acceptance and (ii) on the effective date determined
pursuant thereto record the information contained therein in the
Register and give notice of such acceptance and recordation to the
Lenders and the Borrower.
(e) Subject to Section 13.16, the Borrower authorizes
each Lender to disclose to any Participant or Assignee (each, a
"Transferee") and any prospective Transferee any and all financial
information in such Lender's possession concerning the Borrower and
its Affiliates that has been delivered to such Lender by or on
behalf of the Borrower pursuant to this Agreement or which has been
delivered to such Lender by or on behalf of the Borrower in
connection with such Lender's credit evaluation of the Borrower and
its Affiliates prior to becoming a party to this Agreement,
provided that neither the Administrative Agent nor any Lender shall
provide to any Transferee or prospective Transferee any of the
Confidential Information unless such Person shall have previously
executed a Confidentiality Agreement in the form of Exhibit F.
13.7 Replacements of Lenders under Certain Circumstances. The
Borrower shall be permitted to replace any Lender that (a) requests
reimbursement for amounts owing pursuant to Section 2.10, 2.12, 3.5 or 5.4,
(b) is affected in the manner described in Section 2.10(a)(iii) and as a
result thereof any of the actions described in such Section is required to be
taken or (c) becomes a Defaulting Lender, with a replacement bank or other
financial institution, provided that (i) such replacement does not conflict
with any Requirement of Law, (ii) no Event of Default shall have occurred and
be continuing at the time of such replacement, (iii) the Borrower shall repay
(or the replacement bank or institution shall purchase, at par) all Loans and
other amounts (other than any disputed amounts), pursuant to Section 2.10,
2.11, 2.12, 3.5 or 5.4, as the case may be, owing to such replaced Lender
prior to the date of replacement, (iv) the replacement bank or institution, if
not already a Lender, and the terms and conditions of such replacement, shall
be reasonably satisfactory to the Administrative Agent, (v) the replaced Lender
shall be obligated to make such replacement in accordance with the provisions
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of Section 13.6 (provided that the Borrower shall be obligated to pay the
registration and processing fee referred to therein) and (vi) any such
replacement shall not be deemed to be a waiver of any rights that the Borrower,
the Administrative Agent or any other Lender shall have against the replaced
Lender.
13.8 Adjustments; Set-off. (a) If any Lender (a "benefitted
Lender") shall at any time receive any payment of all or part of its Loans, or
interest thereon, or receive any collateral in respect thereof (whether
voluntarily or involuntarily, by set-off, pursuant to events or proceedings of
the nature referred to in Section 11.5, or otherwise), in a greater proportion
than any such payment to or collateral received by any other Lender, if any, in
respect of such other Lender's Loans, or interest thereon, such benefitted
Lender shall purchase for cash from the other Lenders a participating interest
in such portion of each such other Lender's Loan, or shall provide such other
Lenders with the benefits of any such collateral, or the proceeds thereof,
as shall be necessary to cause such benefitted Lender to share the excess
payment or benefits of such collateral or proceeds ratably with each of the
Lenders; provided, however, that if all or any portion of such excess payment
or benefits is thereafter recovered from such benefitted Lender, such purchase
shall be rescinded, and the purchase price and benefits returned, to the extent
of such recovery, but without interest.
(b) After the occurrence and during the continuance of an Event of
Default, in addition to any rights and remedies of the Lenders provided by law,
each Lender shall have the right, without prior notice to the Borrower, any
such notice being expressly waived by the Borrower to the extent permitted by
applicable law, upon any amount becoming due and payable by the Borrower
hereunder (whether at the stated maturity, by acceleration or otherwise) to
set-off and appropriate and apply against such amount any and all deposits
(general or special, time or demand, provisional or final), in any currency,
and any other credits, indebtedness or claims, in any currency, in each case
whether direct or indirect, absolute or contingent, matured or unmatured, at
any time held or owing by such Lender or any branch or agency thereof to or for
the credit or the account of the Borrower. Each Lender agrees promptly to
notify the Borrower and the Administrative Agent after any such set-off and
application made by such Lender, provided that the failure to give such notice
shall not affect the validity of such set-off and application.
13.9 Counterparts. This Agreement may be executed by one or more of
the parties to this Agreement on any number of separate counterparts
(including by facsimile transmission), and all of said counterparts taken
together shall be deemed to constitute one and the same instrument. A set of
the copies of this Agreement signed by all the parties shall be lodged with the
Borrower and the Administrative Agent.
13.10 Severability. Any provision of this Agreement that is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
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13.11 Integration. This Agreement and the other Credit Documents
represent the agreement of the Borrower, the Administrative Agent and the
Lenders with respect to the subject matter hereof, and there are no promises,
undertakings, representations or warranties by the Administrative Agent or any
Lender relative to subject matter hereof not expressly set forth or referred to
herein or in the other Credit Documents.
13.12 GOVERNING LAW. THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS
OF THE PARTIES HEREUNDER SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN
ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.
13.13 Submission to Jurisdiction; Waivers. The Borrower hereby
irrevocably and unconditionally:
(a) submits for itself and its property in any legal
action or proceeding relating to this Agreement and the other
Credit Documents to which it is a party, or for recognition and
enforcement of any judgment in respect thereof, to the non-
exclusive general jurisdiction of the courts of the State of New
York, the courts of the United States of America for the Southern
District of New York and appellate courts from any thereof;
(b) consents that any such action or proceeding may be
brought in such courts and waives any objection that it may now or
hereafter have to the venue of any such action or proceeding in any
such court or that such action or proceeding was brought in an
inconvenient court and agrees not to plead or claim the same;
(c) agrees that service of process in any such action or
proceeding may be effected by mailing a copy thereof by registered
or certified mail (or any substantially similar form of mail),
postage prepaid, to the Borrower at its address set forth in
Section 13.2 or at such other address of which the Administrative
Agent shall have been notified pursuant thereto;
(d) agrees that nothing herein shall affect the right to
effect service of process in any other manner permitted by law or
shall limit the right to sue in any other jurisdiction; and
(e) waives, to the maximum extent not prohibited by law,
any right it may have to claim or recover in any legal action or
proceeding referred to in this Section 13.13 any special,
exemplary, punitive or consequential damages.
13.14 Acknowledgments. The Borrower hereby acknowledges that:
(a) it has been advised by counsel in the negotiation,
execution and delivery of this Agreement and the other Credit
Documents;
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(b) neither the Administrative Agent nor any Lender has
any fiduciary relationship with or duty to the Borrower arising out
of or in connection with this Agreement or any of the other Credit
Documents, and the relationship between Administrative Agent and
Lenders, on one hand, and the Borrower, on the other hand, in
connection herewith or therewith is solely that of debtor and
creditor; and
(c) no joint venture is created hereby or by the other
Credit Documents or otherwise exists by virtue of the transactions
contemplated hereby among the Lenders or among the Borrower and the
Lenders.
13.15 WAIVERS OF JURY TRIAL. THE BORROWER, THE ADMINISTRATIVE AGENT
AND THE LENDERS HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVE TRIAL BY JURY IN
ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER CREDIT
DOCUMENT AND FOR ANY COUNTERCLAIM THEREIN.
13.16 Confidentiality. The Administrative Agent and each Lender
shall hold all non-public information furnished by or on behalf of the Borrower
in connection with such Lender's evaluation of whether to become a Lender
hereunder or obtained by such Lender or the Administrative Agent pursuant to
the requirements of this Agreement ("Confidential Information"), in accordance
with its customary procedure for handling confidential information of this
nature and (in the case of a Lender that is a bank) in accordance with safe and
sound banking practices and in any event may make disclosure as required or
requested by any governmental agency or representative thereof or pursuant to
legal process or to such Lender's or the Administrative Agent's attorneys,
professional advisors or independent auditors or Affiliates, provided that
unless specifically prohibited by applicable law or court order, each Lender
and the Administrative Agent shall notify the Borrower of any request by any
governmental agency or representative thereof (other than any such request in
connection with an examination of the financial condition of such Lender by
such governmental agency) for disclosure of any such non-public information
prior to disclosure of such information, and provided further that in no event
shall any Lender or the Administrative Agent be obligated or required to return
any materials furnished by the Borrower or any Subsidiary of the Borrower.
Each Lender and the Administrative Agent agrees that it will not provide to
prospective Transferees or to prospective direct or indirect contractual
counterparties in swap agreements to be entered into in connection with Loans
made hereunder any of the Confidential Information unless such Person shall
have previously executed a Confidentiality Agreement in the form of Exhibit F.
13.17 Effect of Amendment and Restatement. Upon the effectiveness
of the amendment and restatement of the Original Credit Agreement in the form
hereof:
(a) the Original Credit Agreement (including all
Exhibits and Schedules thereto) will be amended and restated in its
entirety as set forth herein; and
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(b) all Loans outstanding under the Original Credit
Agreement as of the Closing Date shall continue to remain
outstanding hereunder;
provided that the amendment and restatement of the original Credit Agreement in
the form hereof shall not affect the Borrower's obligations accrued in respect
of any principal, interest, fees or other amounts under the Original Credit
Agreement, constitute a novation of the obligations and liabilities existing
under the Original Credit Agreement, or be deemed to evidence or constitute
repayment of all or any portion of any such obligations or liabilities. It is
expressly understood that, unless and until the Closing Date occurs, neither
this Agreement nor any of the terms or provisions hereof shall be construed, by
implication or otherwise, to constitute a waiver of any Default or Event of
Default under the Original Credit Agreement or otherwise alter or affect the
Borrower's obligations thereunder.
13.18 Waiver. Effective on (and subject to the occurrence of) the
Closing Date, the Lenders hereby waive any Default or Event of Default arising
under the original Credit Agreement as a result of the Borrower's failure to
comply with the provisions of (a) Section 10.8 of the Original Credit Agreement
at September 30, 1998 and (b) Section 10.9 of the Original Credit Agreement
with respect to the Test Period ending September 30, 1998.
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IN WITNESS WHEREOF, each of the parties hereto has caused a
counterpart of this Agreement to be duly executed and delivered as of the
date first above written.
BORDEN CHEMICALS AND PLASTICS
OPERATING LIMITED PARTNERSHIP,
by
BCP MANAGEMENT, INC., as General Partner,
by
Name:
Title:
THE CHASE MANHATTAN BANK, as
Administrative Agent and as a Lender,
by
Name:
Title:
HIBERNIA NATIONAL BANK,
by
Name:
Title:
PNC BANK, NATIONAL ASSOCIATION,
by
Name:
Title:
THE HUNTINGTON NATIONAL BANK,
by
Name:
Title:
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NATIONSBANK, N.A.,
by
Name:
Title:
BANK ONE, NA,
by
Name:
Title:
WACHOVIA BANK, N.A,
by
Name:
Title:
STAR BANK, N.A.,
by
Name:
Title:
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SCHEDULE 1.1
Contact Person, Revolving
Telephone and Credit
Lender Telecopy Number Commitment
The Chase Manhattan Bank Mary Elisabeth Swerz $12,825,000
270 Park Avenue, 38th Floor Tel: (212) 270-4142
New York, NY 10017 Fax: (212) 270-7939
Hibernia National Bank Trudy Nelson $11,025,000
313 Carondelet Street Tel: (504) 533-3213
Suite 1300 Fax: (504) 533-5434
New Orleans, LA 70130
PNC Bank, National Toby Rau $11,025,000
Association Tel: (513) 651-8689
201 East Fifth Street Fax: (513) 651-8951
3rd Floor
Cincinnati, OH 45202
The Huntington National Bank Mark Scurci $11,025,000
41 South High Street - HC0810 Tel: (614) 480-4196
Columbus, OH 43215 Fax: (614) 480-5791
NationsBank, N.A. Fred Zagar $11,025,000
100 North Tryon Street Tel: (212) 503-8242
8th Floor Fax: (212) 503-7080
Charlotte, NC 28255
Bank One NA Michelle Woods $11,025,000
POLYGRAM Box 710209 Tel: (614) 248-3207
Columbus, OH 43271-0209 Fax: (614) 248-5518
Wachovia Bank, N.A. Bradford L. Watkins $11,025,000
191 Peachtree Street N.E. Tel: (404) 332-1093
Atlanta, GA 30303 Fax: (404) 332-6898
Star Bank, N.A. Richard W. Neltmer $11,025,000
425 Walnut Street, 8th Floor Tel: (513) 632-4073
Cincinnati, OH 45201-1038 Fax: (513) 632-2068
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SCHEDULE 8.12
SUBSIDIARIES OF THE BORROWER
Borrower's Direct or Indirect
Name Ownership Interest
BCP Finance Corporation 100%
BEV Management LLC 100%
VEI Limited Partnership 51%
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EXHIBIT H
SECURITY AGREEMENT dated
as of December 23, 1998, among
BORDEN CHEMICALS AND PLASTICS
OPERATING LIMITED PARTNERSHIP, a
Delaware limited partnership (the
"Borrower"), each subsidiary of
the Borrower listed on Schedule I
hereto (each such subsidiary
individually a "Subsidiary
Grantor" and collectively, the
"Subsidiary Grantors"; the
Subsidiary Grantors and the
Borrower are referred to
collectively herein as the
"Grantors") and The Chase
Manhattan Bank, as administrative
agent (in such capacity, the
"Administrative Agent") for the
Secured Parties (as defined
herein).
Reference is made to the Amended and Restated
Credit Agreement dated as of December 17, 1997, as amended and
restated as of December 23, 1998 (as amended, supplemented or
otherwise modified from time to time, the "Credit Agreement"),
among the Borrower, the lenders from time to time party thereto
(the "Lenders") and the Administrative Agent.
The Lenders have agreed to make Loans to the
Borrower pursuant to, and upon the terms and subject to the
conditions specified in, the Credit Agreement. The obligations of
the Lenders to make Loans are conditioned upon, among other things,
the execution and delivery by the Grantors of an agreement in the
form hereof to secure (a) the due and punctual payment by the
Borrower of (i) the principal of and premium, if any, and interest
(including interest accruing during the pendency of any bankruptcy,
insolvency, receivership or other similar proceeding, regardless of
whether allowed or allowable in such proceeding) on the Loans, when
and as due, whether at maturity, by acceleration, upon one or more
dates set for prepayment or otherwise and (ii) all other monetary
obligations, including fees, costs, expenses and indemnities,
whether primary, secondary, direct, contingent, fixed or otherwise
(including monetary obligations incurred during the pendency of any
bankruptcy, insolvency, receivership or other similar proceeding,
to the Secured Parties under the Credit Agreement and the other
Credit Documents and (b) the due and punctual performance of all
covenants, agreements, obligations and liabilities of the Borrower
under or pursuant to the Credit Agreement and the other Credit
Documents (all the monetary and other obligations described in the
preceding clauses (a) and (b) being referred to collectively as the
"Obligations").
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Accordingly, the Grantors and the Administrative
Agent, on behalf of itself and each Secured Party (and each of
their respective successors or assigns), hereby agree as follows:
ARTICLE I
Definitions
SECTION 1.1 Definition of Terms Used Herein.
Unless the context otherwise requires, all capitalized terms used
but not defined herein shall have the meanings set forth in the
Credit Agreement.
SECTION 1.2 Definition of Certain Terms Used
Herein. As used herein, the following terms shall have the
following meanings:
"Account Debtor" shall mean any Person who is or
who may become obligated to any Grantor under, with respect to or
on account of an Account Receivable.
"Accounts Receivable" shall mean, with respect to
any Grantor, (i) such Grantor's accounts receivable (whether or not
earned by performance), chattel paper, instruments, documents,
general intangibles, trade acceptances, any other rights to receive
installment, rental or other payments for, or relating to amounts
due or to become due on account of, goods or equipment sold or
leased or to be sold or leased or services rendered or to be
rendered or funds advanced or loaned or to be advanced or loaned
and other similar rights to payment of any kind and (ii) any
interest of such Grantor in any property or asset of any kind
(whether of such Grantor with respect to such accounts receivable
or any other person securing the payment of any item listed in
clause (i) above).
"Collateral" shall mean all (a) Accounts
Receivable, (b) Inventory and (c) Proceeds.
"Credit Agreement" shall have the meaning assigned
to such term in the preliminary statement of this Agreement.
"Inventory" shall mean all goods of any Grantor,
whether now owned or hereafter acquired, held for sale or lease, or
furnished or to be furnished by any Grantor under contracts of
service, or consumed in any Grantor's business, including raw
materials, intermediates, work in process, packaging materials,
finished goods, semi-finished inventory, scrap inventory,
manufacturing supplies and spare parts, and all such goods that
have been returned to or repossessed by or on behalf of any
Grantor, in each case to the extent constituting "inventory under
Section 9-109(4) of the New York UCC.
"New York UCC" shall mean the Uniform Commercial
Code as in effect on the date hereof in the State of New York.
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"Obligations" shall have the meaning assigned to
such term in the preliminary statement of this Agreement.
"Perfection Certificate" shall mean a certificate
substantially in the form of Exhibit G to the Credit Agreement,
completed and supplemented with the schedules and attachments
contemplated thereby, and duly executed by an Authorized Officer.
"Proceeds" shall mean proceeds of Accounts
Receivable and Inventory within the meaning of Section 9-306 of the
New York UCC.
"Secured Parties" shall mean (a) the Lenders, (b)
the Administrative Agent and (c) the successors and assigns of each
of the foregoing.
"Security Interest" shall have the meaning assigned
to such term in Section 2.01.
ARTICLE II
Security Interest
SECTION 2.1 Security Interest. As security for
the payment or performance, as the case may be, in full of the
Obligations, each Grantor hereby bargains, sells, conveys, assigns,
sets over, mortgages, pledges, hypothecates and transfers to the
Administrative Agent, its successors and assigns, for the ratable
benefit of the Secured Parties, and hereby grants to the
Administrative Agent, its successors and assigns, for the ratable
benefit of the Secured Parties, a security interest in, all of such
Grantor's right, title and interest in, to and under the Collateral
(the "Security Interest"). Without limiting the foregoing, the
Administrative Agent is hereby authorized to file one or more
financing statements, continuation statements or other documents
for the purpose of perfecting, confirming, continuing, enforcing or
protecting the Security Interest granted by each Grantor, without
the signature of any Grantor, and naming any Grantor or the
Grantors as debtors and the Administrative Agent as secured party.
SECTION 2.2 No Assumption of Liability. The
Security Interest is granted as security only and shall not subject
the Administrative Agent or any other Secured Party to, or in any
way alter or modify, any obligation or liability of any Grantor
with respect to or arising out of the Collateral.
SECTION 2.3 Certain Exclusions. Notwithstanding
anything to the contrary herein, BEV Management LLC is not granting
any security interest over, and the term "Collateral" with respect
to BEV Management LLC shall not include, any Accounts Receivable,
Inventory or Proceeds to the extent held by BEV Management LLC but
beneficially owned by VEI Limited Partnership.
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ARTICLE III
Representations and Warranties
The Grantors jointly and severally represent and
warrant to the Administrative Agent and the Secured Parties that:
SECTION 3.1 Title and Authority. Each Grantor has
good and valid rights in and title to the Collateral with respect
to which it has purported to grant a Security Interest hereunder
(except to the extent encumbered by Permitted Collateral Liens) and
has full power and authority to grant to the Administrative Agent
the Security Interest in such Collateral pursuant hereto and to
execute, deliver and perform its obligations in accordance with the
terms of this Agreement, without the consent or approval of any
other Person other than any consent or approval which has been
obtained.
SECTION 3.2 Filings. The Perfection Certificate
has been duly prepared, completed and executed and the information
set forth therein is correct and complete. Fully executed Uniform
Commercial Code financing statements, or other appropriate filings,
recordings or registrations containing a description of the
Collateral have been delivered to the Administrative Agent for
filing in each governmental, municipal or other office specified in
the Perfection Certificate, which are all the filings, recordings
and registrations that are necessary to publish notice of and
protect the validity of and to establish a legal, valid and
perfected security interest in favor of the Administrative Agent
for the ratable benefit of the Secured Parties) in respect of all
Collateral in which the Security Interest may be perfected by
filing, recording or registration in the United States (or any
political subdivision thereof) and its territories and possessions,
and no further or subsequent filing, refiling, recording,
rerecording, registration or reregistration is necessary in any
such jurisdiction, except as provided under applicable law with
respect to the filing of continuation statements.
SECTION 3.3 Validity of Security Interest. The
Security Interest constitutes (a) a legal and valid security
interest in all the Collateral securing the payment and performance
of the Obligations and (b) subject to the filings described in
Section 3.02 above, a perfected security interest in all Collateral
in which a security interest may be perfected by filing, recording
or registering a financing statement or analogous document in the
United States (or any political subdivision thereof) and its
territories and possessions pursuant to the Uniform Commercial Code
or other applicable law in such jurisdictions. The Security
Interest is and shall be prior to any other Lien on any of the
Collateral other than Permitted Collateral Liens.
SECTION 3.4 Absence of Other Liens. The
Collateral is owned by the Grantors free and clear of any Lien,
except for the Security Interest and Permitted Collateral Liens.
The Grantor has not filed or consented to the filing of (a) any
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financing statement or analogous document under the Uniform
Commercial Code or any other applicable laws covering any
Collateral or (b) any assignment in which any Grantor assigns any
Collateral or any security agreement or similar instrument covering
any Collateral with any foreign governmental, municipal or other
office, which financing statement or analogous document,
assignment, security agreement or similar instrument is still in
effect.
ARTICLE IV
Covenants
SECTION 4.1 Records. Each Grantor agrees to
maintain, at its own cost and expense, such complete and accurate
records with respect to the Collateral owned by it as is consistent
with its current practices and in accordance with such prudent and
standard practices used in industries that are the same as or
similar to those in which such Grantor is engaged and, at such time
or times as the Administrative Agent may reasonably request,
promptly to prepare and deliver to the Administrative Agent a
schedule or schedules in form and detail satisfactory to the
Administrative Agent showing the identity, amount and location of
any and all Collateral.
SECTION 4.2 [reserved]
SECTION 4.3 Protection of Security. Each Grantor
shall, at its own cost and expense, take any and all actions
necessary to defend title to the Collateral against all Persons and
to defend the Security Interest of the Administrative Agent in the
Collateral and the priority thereof against any other Lien other
than Permitted Collateral Liens.
SECTION 4.4 Further Assurances. Each Grantor
agrees, at its own expense, to execute, acknowledge, deliver and
cause to be duly filed all such further instruments and documents
and take all such actions as the Administrative Agent may from time
to time request to better assure, preserve, protect and perfect the
Security Interest and the rights and remedies created hereby,
including the payment of any fees and taxes required in connection
with the execution and delivery of this Agreement, the granting of
the Security Interest and the filing of any financing statements or
other documents in connection herewith or therewith. If any amount
payable under or in connection with any of the Collateral shall be
or become evidenced by any promissory note or other instrument,
such note or instrument shall be immediately pledged and delivered
to the Administrative Agent, duly endorsed in a manner satisfactory
to the Administrative Agent.
SECTION 4.5 [reserved]
SECTION 4.6 Taxes; Encumbrances. At its option
and upon and during the continuance of an Event of Default, the
Administrative Agent may discharge past due taxes, assessments,
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charges, fees, Liens, security interests or other encumbrances at
any time levied or placed on the Collateral, and may pay for the
maintenance and preservation of the Collateral to the extent any
Grantor fails to do so as required by the Credit Agreement or this
Agreement, and each Grantor jointly and severally agrees to
reimburse the Administrative Agent on demand for any payment made
or any expense incurred by the Administrative Agent pursuant to the
foregoing authorization; provided, however, that nothing in this
Section 4.06 shall be interpreted as excusing any Grantor from the
performance of, or imposing any obligation on the Administrative
Agent or any Secured Party to cure or perform, any covenants or
other promises of any Grantor with respect to taxes, assessments,
charges, fees, liens, security interests or other encumbrances and
maintenance as set forth herein or in the other Credit Documents.
SECTION 4.7 Assignment of Security Interest. If
at any time any Grantor shall take a security interest in any
property of an Account Debtor or any other person to secure payment
and performance of an Account Receivable, such Grantor shall
promptly assign such security interest to the Administrative Agent.
Such assignment need not be filed of public record unless necessary
to continue the perfected status of the security interest against
creditors of and transferees from the Account Debtor or other
person granting the security interest.
SECTION 4.8 Continuing Obligations of the
Grantors. Each Grantor shall remain liable to observe and perform
all the conditions and obligations to be observed and performed by
it under each contract, agreement or instrument relating to the
Collateral, all in accordance with the terms and conditions
thereof, and each Grantor jointly and severally agrees to indemnify
and hold harmless the Administrative Agent and the Secured Parties
from and against any and all liability for such performance.
SECTION 4.9 Use and Disposition of Collateral.
Except as permitted by the Credit Agreement, none of the Grantors
shall make or permit to be made an assignment, pledge or
hypothecation of the Collateral or shall grant any other Lien in
respect of the Collateral. Except as permitted by the Credit
Agreement, none of the Grantors shall make or permit to be made any
transfer of the Collateral and each Grantor shall remain at all
times in possession of the Collateral owned by it, except that (a)
Inventory may be sold in the ordinary course of business, (b)
Inventory in an aggregate amount not exceeding $5,500,000 at any
time may be delivered to and held by customers on consignment and
(c) Inventory may be in the possession or control of a
warehouseman, bailee, agent or processor subject to the following
sentence. Without limiting the generality of the foregoing, each
Grantor agrees that, following the date that is sixty days after
the date hereof, it shall not permit any Inventory to be in the
possession or control of any warehouseman, bailee, agent or
processor at any time, or to be located at any facility that is not
owned by a Grantor (other than facilities of consignees, subject to
the limitations of clause (b) above) unless such warehouseman,
bailee, agent or processor, or the owner of such facility (as
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applicable), shall have been notified of the Security Interest and
shall have agreed in writing to hold the Inventory subject to the
Security Interest and the instructions of the Administrative Agent
and to waive and release any Lien held by it with respect to such
Inventory, whether arising by operation of law or otherwise.
SECTION 4.10 Limitation on Modification of
Accounts Receivable. None of the Grantors will, without the
Administrative Agent's prior written consent, grant any extension
of the time of payment of any of the Accounts Receivable,
compromise, compound or settle the same for less than the full
amount thereof, release, wholly or partly, any person liable for
the payment thereof or allow any credit or discount whatsoever
thereon, other than extensions, credits, discounts, compromises or
settlements granted or made in the ordinary course of business and
consistent with its current practices and in accordance with such
prudent and standard practices used in industries that are the same
as or similar to those in which such Grantor is engaged.
SECTION 4.11 Insurance. The Grantors, at their
own expense, shall maintain or cause to be maintained insurance
covering physical loss or damage to the Inventory in accordance
with and to the extent required under Section 9.3 of the Credit
Agreement. Each Grantor irrevocably makes, constitutes and appoints
the Administrative Agent (and all officers, employees or agents
designated by the Administrative Agent) as such Grantor's true and
lawful agent (and attorney-in-fact) for the purpose, during the
continuance of an Event of Default, of making, settling and
adjusting claims in respect of Collateral under policies of
insurance, endorsing the name of such Grantor on any check, draft,
instrument or other item of payment for the proceeds of such
policies of insurance and for making all determinations and
decisions with respect thereto. In the event that any Grantor at
any time or times shall fail to obtain or maintain any of the
policies of insurance required hereby or to pay any premium in
whole or part relating thereto, the Administrative Agent may,
without waiving or releasing any obligation or liability of the
Grantors hereunder or any Event of Default, in its sole discretion,
during the continuance of an Event of Default, obtain and maintain
such policies of insurance and pay such premium and take any other
actions with respect thereto as the Administrative Agent deems
advisable. All sums disbursed by the Administrative Agent in
connection with this Section 4.11, including reasonable attorneys'
fees, court costs, expenses and other charges relating thereto,
shall be payable, upon demand, by the Grantors to the
Administrative Agent and shall be additional Obligations secured
hereby.
SECTION 4.12 Accounts. Each Grantor will arrange
for each bank with a lockbox account into which the Proceeds of
Accounts Receivable and Inventory of such Grantor are deposited
from time to time to enter into agreements with the Administrative
Agent sufficient to perfect a security interest in such accounts in
favor of the Administrative Agent with respect to the Proceeds of
such Accounts Receivable and Inventory and providing for the
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transfer of such funds to an account maintained by the
Administrative Agent after the occurrence and during the
continuance of an Event of Default.
ARTICLE V
Power of Attorney
Each Grantor irrevocably makes, constitutes and
appoints the Administrative Agent (and all officers, employees or
agents designated by the Administrative Agent), during the
continuance of an Event of Default, as such Grantor's true and
lawful agent and attorney-in-fact for the purposes set forth in
this Article V, and in such capacity the Administrative Agent shall
have the right, with power of substitution for each Grantor and in
each Grantor's name or otherwise, for the use and benefit of the
Administrative Agent and the Secured Parties, upon the occurrence
and during the continuance of an Event of Default (a) to receive,
endorse, assign and/or deliver any and all notes, acceptances,
checks, drafts, money orders or other evidences of payment relating
to the Collateral or any part thereof; (b) to demand, collect,
receive payment of, give receipt for and give discharges and
releases of all or any of the Collateral; (c) to sign the name of
any Grantor on any invoice or bill of lading relating to any of the
Collateral; (d) to send verifications of Accounts Receivable to any
Account Debtor; (e) to commence and prosecute any and all suits,
actions or proceedings at law or in equity in any court of
competent jurisdiction to collect or otherwise realize on all or
any of the Collateral or to enforce any rights in respect of any
Collateral; (f) to settle, compromise, compound, adjust or defend
any actions, suits or proceedings relating to all or any of the
Collateral; (g) to notify, or to require any Grantor to notify,
Account Debtors to make payment directly to the Administrative
Agent; and (h) to use, sell, assign, transfer, pledge, make any
agreement with respect to or otherwise deal with all or any of the
Collateral, and to do all other acts and things necessary to carry
out the purposes of this Agreement, as fully and completely as
though the Administrative Agent were the absolute owner of the
Collateral for all purposes; provided, however, that nothing herein
contained shall be construed as requiring or obligating the
Administrative Agent or any Secured Party to make any commitment or
to make any inquiry as to the nature or sufficiency of any payment
received by the Administrative Agent or any Secured Party, or to
present or file any claim or notice, or to take any action with respect
to the Collateral or any part thereof or the moneys due or to become due
in respect thereof or any property covered thereby, and no action
taken or omitted to be taken by the Administrative Agent or any
Secured Party with respect to the Collateral or any part thereof
shall give rise to any defense, counterclaim or offset in favor of
any Grantor or to any claim or action against the Administrative
Agent or any Secured Party. It is understood and agreed that the
appointment of the Administrative Agent as the agent and attorney-
in-fact of the Grantors for the purposes set forth above is coupled
with an interest and is irrevocable. The provisions of this Section
shall in no event relieve any Grantor of any of its obligations
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hereunder or under any other Credit Document with respect to the
Collateral or any part thereof or impose any obligation on the
Administrative Agent or any Secured Party to proceed in any
particular manner with respect to the Collateral or any part
thereof, or in any way limit the exercise by the Administrative
Agent or any Secured Party of any other or further right which it
may have on the date of this Agreement or hereafter, whether
hereunder, under any other Credit Document, by law or otherwise.
ARTICLE VI
Remedies
SECTION 6.1 Remedies upon Default. Upon the
occurrence and during the continuance of an Event of Default, each
Grantor agrees to deliver each item of Collateral to the
Administrative Agent on demand, and it is agreed that the
Administrative Agent shall have the right with or without legal
process and with or without prior notice or demand for performance,
to take possession of the Collateral or any part thereof (at the
same or different times) and without liability for trespass to
enter any premises where the Collateral may be located for the
purpose of taking possession of or removing the Collateral and,
generally, to exercise any and all rights afforded to a secured
party under the Uniform Commercial Code or other applicable law.
Without limiting the generality of the foregoing, each Grantor
agrees that the Administrative Agent shall have the right, subject
to the mandatory requirements of applicable law, to sell or
otherwise dispose of all or any part of the Collateral, at public
or private sale for cash, upon credit or for future delivery as the
Administrative Agent shall deem appropriate. Upon consummation of
any such sale the Administrative Agent shall have the right to
assign, transfer and deliver to the purchaser or purchasers thereof
the Collateral so sold. Each such purchaser at any such sale shall
hold the property sold absolutely, free from any claim or right on
the part of any Grantor, and each Grantor hereby waives (to the
extent permitted by law) all rights of redemption, stay and
appraisal which such Grantor now has or may at any time in the
future have under any rule of law or statute now existing or
hereafter enacted.
The Administrative Agent shall give the Grantors 10
days' written notice (which each Grantor agrees is reasonable
notice within the meaning of Section 9-504(3) of the Uniform
Commercial Code as in effect in the State of New York or its
equivalent in other jurisdictions) of the Administrative Agent's
intention to make any sale of Collateral. Such notice, in the case
of a public sale, shall state the time and place for such sale. Any
such public sale shall be held at such time or times within
ordinary business hours and at such place or places as the
Administrative Agent may fix and state in the notice (if any) of
such sale. At any such sale, the Collateral, or portion thereof, to
be sold may be sold in one lot as an entirety or in separate
parcels, as the Administrative Agent may (in its sole and absolute
discretion) determine. The Administrative Agent shall not be
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obligated to make any sale of any Collateral if it shall determine
not to do so, regardless of the fact that notice of sale of such
Collateral shall have been given. The Administrative Agent may,
without notice or publication, adjourn any public or private sale
or cause the same to be adjourned from time to time by announcement
at the time and place fixed for sale, and such sale may, without
further notice, be made at the time and place to which the same was
so adjourned. In case any sale of all or any part of the Collateral
is made on credit or for future delivery, the Collateral so sold
may be retained by the Administrative Agent until the sale price is
paid by the purchaser or purchasers thereof, but the Administrative
Agent shall not incur any liability in case any such purchaser or
purchasers shall fail to take up and pay for the Collateral so sold
and, in case of any such failure, such Collateral may be sold again
upon like notice. At any public (or, to the extent permitted by
law, private) sale made pursuant to this Section, any Secured Party
may bid for or purchase, free (to the extent permitted by law) from
any right of redemption, stay, valuation or appraisal on the part
of any Grantor (all said rights being also hereby waived and
released to the extent permitted by law), the C part thereof
offered for sale and may make payment on account thereof by using
any claim then due and payable to such Secured Party from any
Grantor as a credit against the purchase price, and such Secured
Party may, upon compliance with the terms of sale, hold, retain and
dispose of such property without further accountability to any
Grantor therefor. For purposes hereof, a written agreement to
purchase the Collateral or any portion thereof shall be treated as
a sale thereof; the Administrative Agent shall be free to carry out
such sale pursuant to such agreement and no Grantor shall be
entitled to the return of the Collateral or any portion thereof
subject thereto, notwithstanding the fact that after the
Administrative Agent shall have entered into such an agreement all
Events of Default shall have been remedied and the Obligations paid
in full. As an alternative to exercising the power of sale herein
conferred upon it, the Administrative Agent may proceed by a suit
or suits at law or in equity to foreclose this Agreement and to
sell the Collateral or any portion thereof pursuant to a judgment
or decree of a court or courts having competent jurisdiction or
pursuant to a proceeding by a court-appointed receiver.
SECTION 6.2 Application of Proceeds. The
Administrative Agent shall apply the proceeds of any collection or
sale of the Collateral, as well as any Collateral consisting of
cash, as follows:
FIRST, to the payment of all costs and expenses
incurred by the Administrative Agent (in its capacity as
such hereunder or under any other Credit Document) in
connection with such collection or sale or otherwise in
connection with this Agreement or any of the Obligations,
including all court costs and the fees and expenses of its
agents and legal counsel, the repayment of all advances
made by the Administrative Agent hereunder or under any
other Credit Document on behalf of any Grantor and any
other costs or expenses incurred in connection with the
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exercise of any right or remedy hereunder or under any
other Credit Document;
SECOND, to the payment in full of the Obligations
(the amounts so applied to be distributed among the Secured
Parties pro rata in accordance with the amounts of the
Obligations owed to them on the date of any such
distribution); and
THIRD, to the Grantors, their successors or
assigns, or as a court of competent jurisdiction may
otherwise direct.
The Administrative Agent shall have absolute discretion as to the
time of application of any such proceeds, moneys or balances in
accordance with this Agreement. Upon any sale of the Collateral by
the Administrative Agent (including pursuant to a power of sale
granted by statute or under a judicial proceeding), the receipt of
the Administrative Agent or of the officer making the sale shall be
a sufficient discharge to the purchaser or purchasers of the
Collateral so sold and such purchaser or purchasers shall not be
obligated to see to the application of any part of the purchase
money paid over to the Administrative Agent or such officer or be
answerable in any way for the misapplication thereof.
ARTICLE VII
Miscellaneous
SECTION 7.1 Notices. All communications and
notices hereunder shall (except as otherwise expressly permitted
herein) be in writing and given as provided in Section 13.2 of the
Credit Agreement. All communications and notices hereunder to any
Subsidiary Grantor shall be given to it at its address or telecopy
number set forth on Schedule I, with a copy to the Borrower.
SECTION 7.2 Security Interest Absolute. All
rights of the Administrative Agent hereunder, the Security Interest
and all obligations of the Grantors hereunder shall be absolute and
unconditional irrespective of (a) any lack of validity or
enforceability of the Credit Agreement, any other Credit Document,
any agreement with respect to any of the Obligations or any other
agreement or instrument relating to any of the foregoing, (b) any
change in the time, manner or place of payment of, or in any other
term of, all or any of the Obligations, or any other amendment or
waiver of or any consent to any departure from the Credit
Agreement, any other Credit Document or any other agreement or
instrument, (c) any exchange, release or non-perfection of any Lien
on other collateral, or any release or amendment or waiver of or
consent under or departure from any guarantee, securing or
guaranteeing all or any of the Obligations, or (d) any other
circumstance that might otherwise constitute a defense available
to, or a discharge of, any Grantor in respect of the Obligations or
this Agreement.
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SECTION 7.3 Survival of Agreement. All covenants,
agreements, representations and warranties made by any Grantor
herein and in the certificates or other instruments prepared or
delivered in connection with or pursuant to this Agreement shall be
considered to have been relied upon by the Secured Parties and
shall survive the making by the Lenders of the Loans, and the
execution and delivery to the Lenders of any notes evidencing such
Loans, regardless of any investigation made by the Lenders or on
their behalf, and shall continue in full force and effect until
this Agreement shall terminate.
SECTION 7.4 Binding Effect; Several Agreement.
This Agreement shall become effective as to any Grantor when a
counterpart hereof executed on behalf of such Grantor shall have
been delivered to the Administrative Agent and a counterpart hereof
shall have been executed on behalf of the Administrative Agent, and
thereafter shall be binding upon such Grantor and the
Administrative Agent and their respective successors and assigns,
and shall inure to the benefit of such Grantor, the Administrative
Agent and the other Secured Parties and their respective successors
and assigns, except that no Grantor shall have the right to assign
or transfer its rights or obligations hereunder or any interest
herein or in the Collateral (and any such assignment or transfer
shall be void) except as expressly contemplated by this Agreement
or the Credit Agreement. This Agreement shall be construed as a
separate agreement with respect to each Grantor and may be amended,
modified, supplemented, waived or released with respect to any
Grantor without the approval of any other Grantor and without
affecting the obligations of any other Grantor hereunder.
SECTION 7.5 Successors and Assigns. Whenever in
this Agreement any of the parties hereto is referred to, such
reference shall be deemed to include the successors and assigns of
such party; and all covenants, promises and agreements by or on
behalf of any Grantor or the Administrative Agent that are
contained in this Agreement shall bind and inure to the benefit of
their respective successors and assigns.
SECTION 7.6 Administrative Agent's Fees and
Expenses; Indemnification. (a) Each Grantor jointly and severally
agrees to pay upon demand to the Administrative Agent the amount of
any and all reasonable expenses, including the reasonable fees,
disbursements and other charges of its counsel and of any experts
or agents, which the Administrative Agent may incur in connection
with (i) the administration of this Agreement (including the
customary fees and charges of the Administrative Agent for any
audits conducted by it or on its behalf with respect to the
Collateral), (ii) the custody or preservation of, or the sale of,
collection from or other realization upon any of the Collateral,
(iii)the exercise, enforcement or protection of any of the rights
of the Administrative Agent hereunder or (iv) the failure of any
Grantor to perform or observe any of the provisions hereof.
(b) Without limitation of its indemnification
obligations under the other Credit Documents, each Grantor jointly
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and severally agrees to indemnify the Administrative Agent and the
other Indemnitees against, and hold each of them harmless from, any
and all losses, claims, damages, liabilities and related expenses,
including reasonable fees, disbursements and other charges of
counsel, incurred by or asserted against any of them arising out
of, in any way connected with, or as a result of, the execution,
delivery or performance of this Agreement or any claim, litigation,
investigation or proceeding relating hereto or to the Collateral,
whether or not any Indemnitee is a party thereto; provided that
such indemnity shall not, as to any Indemnitee, be available to the
extent that such losses, claims, damages, liabilities or related
expenses are determined by a court of competent jurisdiction by
final and nonappealable judgment to have resulted from the gross
negligence or willful misconduct of such Indemnitee.
(c) Any such amounts payable as provided hereunder
shall be additional Obligations secured hereby and by the other
Security Documents. The provisions of this Section 7.06 shall
remain operative and in full force and effect regardless of the
termination of this Agreement or any other Credit Document, the
consummation of the transactions contemplated hereby, the repayment
of any of the Loans, the invalidity or unenforceability of any term
or provision of this Agreement or any other Credit Document, or any
investigation made by or on behalf of the Administrative Agent or
any Lender. All amounts due under this Section 7.06 shall be
payable on written demand therefor.
SECTION 7.7 GOVERNING LAW. THIS AGREEMENT SHALL BE
CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE
OF NEW YORK.
SECTION 7.8 Waivers; Amendment. (a) No failure
or delay of the Administrative Agent in exercising any power or
right hereunder shall operate as a waiver thereof, nor shall any
single or partial exercise of any such right or power, or any
abandonment or discontinuance of steps to enforce such a right or
power, preclude any other or further exercise thereof or the
exercise of any other right or power. The rights and remedies of
the Administrative Agent hereunder and of the Administrative Agent,
the Letter of Credit Issuer, the Administrative Agent and the
Lenders under the other Credit Documents are cumulative and are not
exclusive of any rights or remedies that they would otherwise have.
No waiver of any provisions of this Agreement or any other Credit
Document or consent to any departure by any Grantor therefrom shall
in any event be effective unless the same shall be permitted by
paragraph (b) below, and then such waiver or consent shall be
effective only in the specific instance and for the purpose for
which given. No notice to or demand on any Grantor in any case
shall entitle such Grantor or any other Grantor to any other or
further notice or demand in similar or other circumstances.
(b) Neither this Agreement nor any provision hereof
may be waived, amended or modified except pursuant to an agreement
or agreements in writing entered into by the Administrative Agent
and the Grantor or Grantors with respect to which such waiver,
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amendment or modification is to apply, subject to any consent
required in accordance with Section 13.1 of the Credit Agreement.
SECTION 7.9 WAIVER OF JURY TRIAL. EACH PARTY
HERETO HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE
LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY
LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF, UNDER OR IN
CONNECTION WITH THIS AGREEMENT OR ANY OF THE OTHER CREDIT
DOCUMENTS. EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE,
AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR
OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF
LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B)
ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED
TO ENTER INTO THIS AGREEMENT AND THE OTHER CREDIT DOCUMENTS, AS
APPLICABLE, BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND
CERTIFICATIONS IN THIS SECTION 7.09.
SECTION 7.10 Severability. In the event any one
or more of the provisions contained in this Agreement should be
held invalid, illegal or unenforceable in any respect, the
validity, legality and enforceability of the remaining provisions
contained herein shall not in any way be affected or impaired
thereby (it being understood that the invalidity of a particular
provision in a particular jurisdiction shall not in and of itself
affect the validity of such provision in any other jurisdiction).
The parties shall endeavor in good-faith negotiations to replace
the invalid, illegal or unenforceable provisions with valid
provisions the economic effect of which comes as close as possible
to that of the invalid, illegal or unenforceable provisions.
SECTION 7.11 Counterparts. This Agreement may be
executed in two or more counterparts, each of which shall
constitute an original but all of which when taken together shall
constitute but one contract (subject to Section 7.04), and shall
become effective as provided in Section 7.04. Delivery of an
executed signature page to this Agreement by facsimile transmission
shall be effective as delivery of a manually executed counterpart
hereof.
SECTION 7.12 Headings. Article and Section
headings used herein are for the purpose of reference only, are not
part of this Agreement and are not to affect the construction of,
or to be taken into consideration in interpreting, this Agreement.
SECTION 7.13 Jurisdiction; Consent to Service of
Process. (a) Each Grantor hereby irrevocably and unconditionally
submits, for itself and its property, to the nonexclusive
jurisdiction of any New York State court or Federal court of the
United States of America sitting in New York City, and any
appellate court from any thereof, in any action or proceeding
arising out of or relating to this Agreement or the other Credit
Documents, or for recognition or enforcement of any judgment, and
each of the parties hereto hereby irrevocably and unconditionally
agrees that all claims in respect of any such action or proceeding
may be heard and determined in such New York State or, to the
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extent permitted by law, in such Federal court. Each of the parties
hereto agrees that a final judgment in any such action or
proceeding shall be conclusive and may be enforced in other
jurisdictions by suit on the judgment or in any other manner
provided by law. Nothing in this Agreement shall affect any right
that the Administrative Agent, the Letter of Credit Issuer or any
Lender may otherwise have to bring any action or proceeding
relating to this Agreement or the other Credit Documents against
any Grantor or its properties in the courts of any jurisdiction.
(b) Each Grantor hereby irrevocably and
unconditionally waives, to the fullest extent it may legally and
effectively do so, any objection which it may now or hereafter have
to the laying of venue of any suit, action or proceeding arising
out of or relating to this Agreement or the other Credit Documents
in any New York State or Federal court. Each of the parties hereto
hereby irrevocably waives, to the fullest extent permitted by law,
the defense of an inconvenient forum to the maintenance of such
action or proceeding in any such court.
(c) Each party to this Agreement irrevocably
consents to service of process in the manner provided for notices
in Section 7.01. Nothing in this Agreement will affect the right of
any party to this Agreement to serve process in any other manner
permitted by law.
SECTION 7.14 Termination. This Agreement and the
Security Interest shall terminate when all the Obligations have
been indefeasibly paid in full, the Lenders have no further
commitment to lend, the Letter of Credit Exposure has been reduced
to zero and the Letter of Credit Issuer has no further commitment
to issue Letters of Credit under the Credit Agreement, at which
time the Administrative Agent shall execute and deliver to the
Grantors, at the Grantors' expense, all Uniform Commercial Code
termination statements and similar documents which the Grantors
shall reasonably request to evidence such termination; provided
that the Security Interest will automatically terminate with
respect to Collateral sold, transferred or disposed of in
accordance with the Credit Agreement. Any execution and delivery of
termination statements or documents pursuant to this Section 7.14
shall be without recourse to or warranty by the Administrative
Agent. A Subsidiary Grantor shall automatically be released from
its obligations hereunder and the Security Interest in the
Collateral of such Subsidiary Grantor shall be automatically
released in the event that all the capital stock of such Subsidiary
Grantor shall be sold, transferred or otherwise disposed of to a
person that is not an Affiliate of the Borrower in accordance with
the terms of the Credit Agreement; provided that the Required
Lenders shall have consented to such sale, transfer or other
disposition (to the extent required by the Credit Agreement) and
the terms of such consent did not provide otherwise.
SECTION 7.15 Additional Subsidiary Grantors. Upon
execution and delivery by the Administrative Agent and a Subsidiary
of an instrument in the form of Annex 1 hereto, such Subsidiary
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shall become a Subsidiary Grantor hereunder with the same force and
effect as if originally named as a Subsidiary Grantor herein. The
execution and delivery of any such instrument shall not require the
consent of any Grantor hereunder. The rights and obligations of
each Grantor hereunder shall remain in full force and effect
notwithstanding the addition of any new Subsidiary Grantor as a
party to this Agreement.
IN WITNESS WHEREOF, the parties hereto have duly
executed this Agreement as of the day and year first above written.
BORDEN CHEMICALS AND PLASTICS
OPERATING LIMITED PARTNERSHIP,
by BCP MANAGEMENT, INC.,
as General Partner
by
Name:
Title:
BCP FINANCE CORPORATION,
by
Name:
Title:
THE CHASE MANHATTAN BANK, as
Administrative Agent,
by
Name:
Title:
BEV MANAGEMENT LLC,
by
Name:
Title:
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SCHEDULE I
Subsidiary Grantors
BCP Finance Corporation
BEV Management LLC
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Annex 1 to the
Security Agreement
SUPPLEMENT NO. __ dated as of __________,
to the Security Agreement dated as of December 23,
1998 (the "Security Agreement"), among BORDEN
CHEMICALS AND PLASTICS OPERATING LIMITED
PARTNERSHIP, a Delaware limited partnership (the
"Borrower"), each subsidiary of the Borrower listed
on Schedule I thereto (each such subsidiary
individually a "Subsidiary Grantor" and
collectively, the "Subsidiary Grantors"; the
Subsidiary Grantors and the Borrower are referred
to collectively herein as the "Grantors") and The
Chase Manhattan Bank, as Administrative Agent (in
such capacity, the "Administrative Agent") for the
Secured Parties (as defined herein).
A. Reference is made to the Amended and
Restated Credit Agreement dated as of December 17, 1997, as amended
and restated as of December 23, 1998 (as amended, supplemented or
otherwise modified from time to time, the "Credit Agreement"),
among the Borrower, the lenders from time to time party thereto
(the "Lenders") and the Administrative Agent.
B. Capitalized terms used herein and not
otherwise defined herein shall have the meanings assigned to such
terms in the Security Agreement and the Credit Agreement.
C. The Grantors have entered into the
Security Agreement in order to induce the Lenders to make Loans.
Section 7.15 of Security Agreement provides that additional
Subsidiaries of the Borrower may become Grantors under the Security
Agreement by execution and delivery of an instrument in the form of
this Supplement. The undersigned Subsidiary (the "New Grantor") is
executing this Supplement in accordance with the requirements of
the Credit Agreement to become a Grantor under the Security
Agreement in order to induce the Lenders to make additional Loans
and as consideration for Loans previously made.
Accordingly, the Administrative Agent and the New
Grantor agree as follows:
SECTION 1. In accordance with Section 7.15 of the
Security Agreement, the New Grantor by its signature below becomes
a Grantor under the Security Agreement with the same force and
effect as if originally named therein as a Grantor and the New
Grantor hereby (a) agrees to all the terms and provisions of the
Security Agreement applicable to it as a Grantor thereunder and (b)
represents and warrants that the representations and warranties
made by it as a Grantor thereunder are true and correct on and as
of the date hereof. In furtherance of the foregoing, the New
Grantor, as security for the payment and performance in full of the
Obligations (as defined in the Security Agreement), does hereby
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create and grant to the Administrative Agent, its successors and
assigns, for the benefit of the Secured Parties, their successors
and assigns, a security interest in and lien on all of the New
Grantor's right, title and interest in and to the Collateral (as
defined in the Security Agreement) of the New Grantor. Each
reference to a "Grantor" in the Security Agreement shall be deemed
to include the New Grantor. The Security Agreement is hereby
incorporated herein by reference.
SECTION 2. The New Grantor represents and
warrants to the Administrative Agent and the other Secured Parties
that this Supplement has been duly authorized, executed and
delivered by it and constitutes its legal, valid and binding
obligation, enforceable against it in accordance with its terms.
SECTION 3. This Supplement may be executed in
counterparts (and by different parties hereto on different
counterparts), each of which shall constitute an original, but all
of which when taken together shall constitute a single contract.
This Supplement shall become effective when the Administrative
Agent shall have received counterparts of this Supplement that,
when taken together, bear the signatures of the New Grantor and the
Administrative Agent. Delivery of an executed signature page to
this Supplement by facsimile transmission shall be as effective as
delivery of a manually signed counterpart of this Supplement.
SECTION 4. The New Grantor hereby represents and
warrants that (a) set forth on Schedule 1 attached hereto is a true
and correct schedule of the location of any and all Collateral of
the New Grantor and (b) set forth under its signature hereto, is
the true and correct location of the chief executive office of the
New Grantor.
SECTION 5. Except as expressly supplemented
hereby, the Security Agreement shall remain in full force and
effect.
SECTION 6. THIS SUPPLEMENT SHALL BE GOVERNED BY,
AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW
YORK.
SECTION 7. In case any one or more of the
provisions contained in this Supplement should be held invalid,
illegal or unenforceable in any respect, the validity, legality and
enforceability of the remaining provisions contained herein and in
the Security Agreement shall not in any way be affected or impaired
thereby (it being understood that the invalidity of a particular
provision in a particular jurisdiction shall not in and of itself
affect the validity of such provision in any other jurisdiction).
The parties hereto shall endeavor in good-faith negotiations to
replace the invalid, illegal or unenforceable provisions with valid
provisions the economic effect of which comes as close as possible
to that of the invalid, illegal or unenforceable provisions.
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SECTION 8. All communications and notices
hereunder shall be in writing and given as provided in Section 7.01
of the Security Agreement. All communications and notices
hereunder to the New Grantor shall be given to it at the address
set forth under its signature below.
SECTION 9. The New Grantor agrees to reimburse
the Administrative Agent for its reasonable out-of-pocket expenses
in connection with this Supplement, including the reasonable fees,
other charges and disbursements of counsel for the Administrative
Agent.
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IN WITNESS WHEREOF, the New Grantor and the
Administrative Agent have duly executed this Supplement to the
Security Agreement as of the day and year first above written.
[Name Of New Grantor],
by
Name:
Title:
Address:
THE CHASE MANHATTAN BANK, as
Administrative Agent, by
by
Name:
Title:
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SCHEDULE I
to Supplement No. ___ to the
Security Agreement
LOCATION OF COLLATERAL
Description Location
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AMENDED AND RESTATED
CREDIT AGREEMENT
among
BORDEN CHEMICALS AND PLASTICS
OPERATING LIMITED PARTNERSHIP
The Several Lenders
from Time to Time Parties Hereto
and
THE CHASE MANHATTAN BANK,
as Administrative Agent
Dated as of December 23, 1998
<PAGE>
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Table of Contents
Page
SECTION 1. Negative Covenants . . . . . . . . . . . . . . . . 1
SECTION 2. Amount and Terms of Credit . . . . . . . . . . . . 25
2.1 Commitments . . . . . . . . . . . . . . . . . 25
2.2 Minimum Amount of Each Borrowing; Maximum
Number of Borrowings . . . . . . . . . . . . . 27
2.3 Notice of Borrowing . . . . . . . . . . . . . 27
2.4 Disbursement of Funds . . . . . . . . . . . . 28
2.5 Repayment of Loans; Evidence of Debt . . . . . 29
2.6 Conversions and Continuations. . . . . . . . . 30
2.7 Pro Rata Borrowings . . . . . . . . . . . . . 30
2.8 Interest . . . . . . . . . . . . . . . . . . . 31
2.9 Interest Periods . . . . . . . . . . . . . . . 31
2.10 Increased Costs, Illegality, etc. . . . . . . 32
2.11 Compensation . . . . . . . . . . . . . . . . . 34
2.12 Change of Lending office . . . . . . . . . . . 35
2.13 Notice of Certain Costs . . . . . . . . . . . 35
SECTION 3. Letters of Credit . . . . . . . . . . . . . . . . . 35
3.1 Letters of Credit . . . . . . . . . . . . . . 35
3.2 Letter of Credit Requests . . . . . . . . . . 36
3.3 Letter of Credit Participations . . . . . . . 36
3.4 Agreement to Repay Letter of Credit Drawings . 39
3.5 Increased Costs . . . . . . . . . . . . . . . 40
3.6 Successor Letter of Credit Issuer . . . . . . 41
SECTION 4. Fees; Commitments . . . . . . . . . . . . . . . . . 42
4.1 Fees . . . . . . . . . . . . . . . . . . . . . 42
4.2 Reduction of Revolving Credit Commitments . . 43
4.3 Mandatory Termination of Commitments . . . . . 44
SECTION 5. Payments . . . . . . . . . . . . . . . . . . . . . 44
5.1 Voluntary Prepayments . . . . . . . . . . . . 44
5.2 Mandatory Prepayments . . . . . . . . . . . . 44
5.3 Method and Place of Payment . . . . . . . . . 46
5.4 Net Payments . . . . . . . . . . . . . . . . . 47
5.5 Computations of Interest and Fees . . . . . . 50
SECTION 6. Conditions Precedent . . . . . . . . . . . . . . . 50
6.1 Effectiveness of Agreement . . . . . . . . . . 50
6.2 Perfection Date Commitments . . . . . . . . . 52
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SECTION 7. Conditions Precedent to All Credit Events . . . . . 52
7.1 No Default; Representations and Warranties . . 52
7.2 Notice of Borrowing; Letter of Credit
Request . . . . . . . . . . . . . . . . . . . 53
SECTION 8. Representations, Warranties and Agreements . . . . 53
8.1 Organization . . . . . . . . . . . . . . . . . 53
8.2 Power and Authority . . . . . . . . . . . . . 53
8.3 No Violation . . . . . . . . . . . . . . . . . 54
8.4 Litigation . . . . . . . . . . . . . . . . . . 54
8.5 Margin Regulations . . . . . . . . . . . . . . 54
8.6 Governmental Approvals . . . . . . . . . . . . 54
8.7 Investment Company Act and Public Utility
Holding Company Act . . . . . . . . . . . . . 54
8.8 True and Complete Disclosure . . . . . . . . . 55
8.9 Financial Condition; Financial Statements . . 55
8.10 Tax Returns and Payments . . . . . . . . . . . 55
8.11 Compliance with ERISA . . . . . . . . . . . . 56
8.12 Subsidiaries . . . . . . . . . . . . . . . . . 56
8.13 Patents, etc. . . . . . . . . . . . . . . . . 57
8.14 Environmental Laws . . . . . . . . . . . . . . 57
8.15 Properties . . . . . . . . . . . . . . . . . . 57
8.16 Security Agreement . . . . . . . . . . . . . . 57
SECTION 9. Affirmative Covenants . . . . . . . . . . . . . . 57
9.1 Information Covenants . . . . . . . . . . . . 57
9.2 Books, Records and Inspections . . . . . . . . 60
9.3 Maintenance of Insurance . . . . . . . . . . . 60
9.4 Payment of Taxes . . . . . . . . . . . . . . . 61
9.5 Existence . . . . . . . . . . . . . . . . . . 61
9.6 Compliance with Statutes, Obligations, etc. . 61
9.7 ERISA . . . . . . . . . . . . . . . . . . . . 61
9.8 Good Repair . . . . . . . . . . . . . . . . . 61
9.9 Transactions with Affiliates . . . . . . . . . 62
9.10 Use of Proceeds and Letters of Credit . . . . 62
9.11 Changes in Business . . . . . . . . . . . . . 62
9.12 Information Regarding Collateral . . . . . . . 63
9.13 Additional Subsidiaries . . . . . . . . . . . 63
9.14 Further Assurances . . . . . . . . . . . . . . 63
9.15 Perfection Date . . . . . . . . . . . . . . . 63
9.16 UCC Searches. . . . . . . . . . . . . . . . . 64
9.17 Borden Set-Off Agreement . . . . . . . . . . . 64
9.18 Engagement Letters . . . . . . . . . . . . . . 64
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SECTION 10. Negative Covenants . . . . . . . . . . . . . . . . 64
10.1 Limitation on Indebtedness; Preferred and
Redeemable Interests . . . . . . . . . . . . . 64
10.2 Limitation on Liens . . . . . . . . . . . . . 66
10.3 Limitation on Fundamental Changes . . . . . . 67
10.4 Limitation on Sale of Assets . . . . . . . . . 68
10.5 Limitation on Investments . . . . . . . . . . 69
10.6 Limitation on Restricted Payments . . . . . . 70
10.7 Limitations on Certain Amendments . . . . . . 72
10.8 Capital Expenditures . . . . . . . . . . . . . 72
10.9 Consolidated EBITDA Coverage Ratio . . . . . . 72
10.10 Cash Management . . . . . . . . . . . . . . . 72
SECTION 11. Events of Default . . . . . . . . . . . . . . 73
11.1 Payments . . . . . . . . . . . . . . . . . . . 73
11.2 Representations, etc . . . . . . . . . . . . . 73
11.3 Covenants . . . . . . . . . . . . . . . . . . 73
11.4 Default Under Other Agreements . . . . . . . . 73
11.5 Bankruptcy, etc . . . . . . . . . . . . . . . 73
11.6 ERISA . . . . . . . . . . . . . . . . . . . . 74
11.7 Judgments . . . . . . . . . . . . . . . . . . 74
11.8 Change of Control . . . . . . . . . . . . . . 74
11.9 General Partner Agreement . . . . . . . . . . 74
11.10 Collateral . . . . . . . . . . . . . . . . . . 74
11.11 Perfection Date . . . . . . . . . . . . . . . 75
SECTION 12. The Administrative Agent . . . . . . . . . . . . . 75
12.1 Appointment . . . . . . . . . . . . . . . . . 75
12.2 Delegation of Duties . . . . . . . . . . . . . 76
12.3 Exculpatory Provisions . . . . . . . . . . . . 76
12.4 Reliance by Administrative Agent . . . . . . . 76
12.5 Notice of Default . . . . . . . . . . . . . . 76
12.6 Non-Reliance on Administrative Agent and
Other Lenders . . . . . . . . . . . . . . . . 77
12.7 Indemnification . . . . . . . . . . . . . . . 77
12.8 Administrative Agent in Its Individual
Capacity . . . . . . . . . . . . . . . . . . . 78
12.9 Successor Agent . . . . . . . . . . . . . . . 78
SECTION 13. Miscellaneous . . . . . . . . . . . . . . . . . . 78
13.1 Amendments and Waivers . . . . . . . . . . . . 78
13.2 Notices . . . . . . . . . . . . . . . . . . . 79
13.3 No Waiver; Cumulative Remedies . . . . . . . . 80
13.4 Survival of Representations and Warranties . . 80
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13.5 Payment of Expenses and Taxes . . . . . . . . 80
13.6 Successors and Assigns; Participations and
Assignments . . . . . . . . . . . . . . . . . 81
13.7 Replacements of Lenders under Certain
Circumstances . . . . . . . . . . . . . . . . 84
13.8 Adjustments; Set-off . . . . . . . . . . . . . 85
13.9 Counterparts . . . . . . . . . . . . . . . . . 85
13.10 Severability . . . . . . . . . . . . . . . . . 85
13.11 Integration . . . . . . . . . . . . . . . . . 86
13.12 GOVERNING LAW . . . . . . . . . . . . . . . . 86
13.13 Submission to Jurisdiction; Waivers . . . . . 86
13.14 Acknowledgments . . . . . . . . . . . . . . . 86
13.15 WAIVERS OF JURY TRIAL . . . . . . . . . . . . 87
13.16 Confidentiality . . . . . . . . . . . . . . . 87
13.17 Effect of Amendment and Restatement . . . . . 87
13.18 Waiver . . . . . . . . . . . . . . . . . . . . 88
SCHEDULES
Schedule 1.1 Revolving Credit Commitments and
Addresses of Lenders
Schedule 8.12 Existing Subsidiaries
Schedule 10.1 Other Indebtedness
EXHIBITS
Exhibit A Form of Promissory Note
Exhibit B Form of Letter of Credit Request
Exhibit C-1 Form of Legal Opinion of Simpson Thacher & Bartlett
Exhibit C-2 Form of Legal Opinion of Lawrence L. Dieker
Exhibit D Form of Assignment and Acceptance
Exhibit E Form of Closing Certificate
Exhibit F Form of Confidentiality Agreement
Exhibit G Form of Perfection Certificate
Exhibit H Form of Security Agreement
Exhibit I Form of General Partner Agreement
Exhibit J Form of Collateral Certificate
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