<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or Section 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of Earliest Event Reported): October 15, 1996
METTLER-TOLEDO, INC.
(Successor by merger to MT Acquisition Corp.)
------------------------------------------------------
(Exact name of Registrant as specified in its charter)
<TABLE>
<S> <C> <C>
Delaware 333-09621 34-1538688
-------- --------- ----------
(State or other jurisdiction of incorporation) (Commission File Number) (IRS Employer Identification No.)
</TABLE>
METTLER-TOLEDO HOLDING INC.
------------------------------------------------------
(Exact name of Registrant as specified in its charter)
<TABLE>
<S> <C> <C>
Delaware 333-09621 13-3900409
-------- --------- ----------
(State or other jurisdiction of incorporation) (Commission File Number) (IRS Employer Identification No.)
</TABLE>
Im Langacher, P.O. Box MT-100
CH 8608 Greifensee, Switzerland
------------------------------------------------------------
(Address of principal executive offices, including zip code)
Registrants' telephone number, including area code: 41-1-944-22-11
Page 1 Of __ Pages
Exhibit Index Is On Page 4
<PAGE>
Item 2. Acquisition or Disposition of Assets.
On October 15, 1996, MT Acquisition Corp. (the "Company"), a wholly
owned subsidiary of Mettler-Toledo Holding Inc. ("Holding") completed the
acquisition of the Mettler-Toledo Group from Ciba-Geigy AG and its wholly owned
subsidiary, AG Fur Prazisionsinstrumente (the "Acquisition"), as contemplated in
the Registration statement, as amended (the "Registration Statement"), on Form
S-1 (Commission File No. 333-09621) filed by the Company and Holding.
Immediately following consummation of the Acquisition, on October 15, 1996, the
Company merged with and into Mettler-Toledo, Inc., a Delaware corporation, with
Mettler-Toledo, Inc. as the surviving entity.
Item 7. Financial Statements and Exhibits.
(a) Financial Statements.
The following combined financial statements, including the
accompanying notes and audit report, which have been excerpted from the
Company's final prospectus filed pursuant to Rule 424(b) and constituting part
of the Registration Statement (the "Prospectus"), are filed as exhibits to this
Current Report and are incorporated by reference in this Item 7:
(1) Audited Combined Statements of Net Assets of the Mettler-Toledo
Group as of December 31, 1994 and 1995;
(2) Audited Combined Statements of Operations of the Mettler-Toledo
Group for the years ended December 31, 1993, 1994 and 1995;
(3) Audited Combined Statements of Changes in Net Assets of the
Mettler-Toledo Group for the years ended December 31, 1993, 1994
and 1995;
(4) Audited Combined Statements of Cash Flows of the Mettler-Toledo
Group for the years ended December 31, 1993, 1994 and 1995;
(5) Interim Combined Statements of Net Assets of the Mettler-Toledo
Group as of December 31, 1995 and June 30, 1996 (unaudited);
(6) Interim Combined Statements of Operations of the Mettler-Toledo
Group for the six months ended June 30, 1995 and 1996
(unaudited);
2
<PAGE>
(7) Interim Combined Statements of Changes in Net Assets of the
Mettler-Toledo Group for the six months ended June 30, 1995 and
1996 (unaudited); and
(8) Interim Combined Statements of Cash Flows of the Mettler-Toledo
Group for the six months ended June 30, 1995 and 1996
(unaudited).
(b) Pro Forma Financial Information
The following unaudited pro forma financial information, including the
accompanying introductory paragraph and notes, which have been excerpted from
the Prospectus, are filed as exhibits to this Current Report and are
incorporated by reference in this Item 7.
(1) Unaudited Pro Forma Balance Sheet as of June 30, 1996 giving
effect to the Acquisition; and
(2) Unaudited Pro Forma Statements of Operations for the year ended
December 31, 1995 and the six months ended June 30, 1995 and
1996 giving effect to the Acquisition.
(c) Exhibits
The following exhibits are filed as part of this Current Report:
2.1 Certificate of Ownership and Merger of MT Acquisition Corp. and
Mettler-Toledo, Inc., filed with the Secretary of State of the
State of Delaware on October 15, 1996.
4.1 Indenture dated as of October 15, 1996, among MT Acquisition
Corp., as Issuer, Mettler-Toledo Holding Inc., as Note Guarantor,
and United States Trust Company of New York, as Trustee.
4.2 First Supplemental Indenture dated as of October 15, 1996, among
Mettler-Toledo, Inc., Mettler-Toledo Holding Inc., as Note
Guarantor, and United States Trust Company of New York, as
Trustee.
23.1 Consent of KPMG Fides Peat.
99.1 Credit Agreement, dated as of October 15, 1996, between MT
Acquisition Corp. and Mettler-Toledo Holding AG, as borrowers,
and Merrill Lynch Capital Corporation, as document agent and the
lenders party thereto.
99.2 Financial Statements of the Mettler-Toledo Group and unaudited
Pro Forma Financial Information excerpted from the Prospectus.
3
<PAGE>
Index to Exhibits
Exhibit No. Description Sequential Page
Number
2.1 Certificate of Ownership and Merger of MT
Acquisition Corp. and Mettler-Toledo, Inc.,
filed with the Secretary of State of the
State of Delaware on October 15, 1996.
4.1 Indenture dated as of October 15, 1996, among
MT Acquisition Corp., as Issuer,
Mettler-Toledo Holding Inc., as Note
Guarantor, and United States Trust Company of
New York, as Trustee.
4.2 First Supplemental Indenture dated as of
October 15, 1996, among Mettler-Toledo, Inc.,
Mettler-Toledo Holding Inc., as Note
Guarantor, and United States Trust Company of
New York, as Trustee.
23.1 Consent of KPMG Fides Peat
99.1 Credit Agreement, dated as of October 15,
1996, between MT Acquisition Corp. and
Mettler-Toledo Holding AG, as borrowers, and
Merrill Lynch Capital Corporation, as
document agent and the lenders party thereto.
99.2 Financial Statements of the Mettler-Toledo
Group and unaudited Pro Forma Financial
Information excerpted from the Prospectus
4
<PAGE>
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Date: October 30, 1996
Mettler-Toledo, Inc.
(successor by merger to MT Acquisition Corp.)
Mettler-Toledo Holding Inc.
By: /s/ Robert F. Spoerry
-----------------------------------------
Robert F. Spoerry
President and Chief Executive Officer
5
<PAGE>
EXHIBIT 2.1
<PAGE>
CERTIFICATE OF OWNERSHIP AND MERGER
OF
MT ACQUISITION CORP.
AND
METTLER-TOLEDO, INC.
- -------------------------------------------------------------------------------
Pursuant to Section 253 of the General Corporation
Law of the State of Delaware
- -------------------------------------------------------------------------------
MT Acquisition Corp. ("Acquisition"), a corporation organized and
existing under the laws of the State of Delaware, desiring to merge into
Mettler-Toledo, Inc. ("MTI"), a corporation organized and existing under the
laws of the State of Delaware, pursuant to the provisions of Section 253 of the
General Corporation Law of the State of Delaware, hereby certifies as follows:
1. Acquisition was incorporated on July 16, 1996 pursuant to the
General Corporation Law of the State of Delaware.
2. Acquisition is the owner of 100% of the issued and outstanding
shares of the common stock of MTI, a corporation incorporated on December 22,
1986 pursuant to the General Corporation Law of the State of Delaware, and MTI
has no class of stock outstanding other than said common stock.
3. The Board of Directors of Acquisition duly adopted the following
resolutions by written consent of the Board of Directors on October 15, 1996
and filed them with the minutes of the Board:
RESOLVED, that MT Acquisition Corp. ("Acquisition") shall be
merged with and into Mettler-Toledo, Inc. ("MTI"), with MTI being the
surviving corporation of the merger and assuming all Acquisition's
liabilities and obligations (the "Merger").
RESOLVED, the Merger shall be effective upon the filing of the
Certificate of Ownership and Merger described below with the Secretary
of State of Delaware.
<PAGE>
RESOLVED, that by virtue of the Merger and without any action on the
part of Acquisition or MTI: (i) the Certificate of Incorporation of
MTI shall be in the form attached hereto as Annex 1, (ii) the By-laws
of Acquisition, as in effect immediately prior to the effective time
of the Merger, shall be the By-laws of MTI except that the heading
thereof shall be amended to read as follows: "AMENDED AND RESTATED
BY-LAWS OF METTLER-TOLEDO, INC.", and (iii) the directors of
Acquisition shall be the directors of MTI, and the officers of
Acquisition shall be the officers of MTI, in each case until their
successors are duly elected or appointed and qualified in the manner
provided by the Certificate of Incorporation and By-laws of MTI or as
otherwise provided by law.
RESOLVED, that by virtue of the Merger and without any action on the
part of Acquisition or MTI: (i) each share of the common stock of MTI
that is issued and outstanding immediately prior to the effective time
of the Merger shall be canceled and (ii) each share of the common
stock of Acquisition that is issued and outstanding immediately prior
to the effective time of the Merger shall be converted into a one
validly issued, fully paid and nonassessable share of the common stock
of MTI.
RESOLVED, that the proposed Merger shall be submitted to the sole
stockholder of Acquisition to be adopted by its written consent; and
upon Acquisition receiving the written consent of such stockholder,
the Merger shall be approved.
RESOLVED, that the Officers, and each of them individually hereby is,
authorized and directed, in the name and on behalf of Acquisition, to
execute, acknowledge and file with the Secretary of State of Delaware,
and the Secretary is authorized and directed to attest, a Certificate
of Ownership and Merger, setting forth a copy of these resolutions,
pursuant to the provisions of Section 253 of the General Corporation
Law of the State of Delaware and to execute, acknowledge, file and
deliver such other agreements, documents, instruments and certificates
and any amendments or supplements thereto (whether under the corporate
seal of Acquisition or otherwise) and to take such other actions as
<PAGE>
they may deem necessary or appropriate to effect the merger provided
for by these resolutions.
4. The merger described above has been approved by the written consent
of the holder of 100% of the issued and outstanding shares of the capital stock
of Acquisition pursuant to Section 228 of the General Corporation Law of the
State of Delaware.
5. Annex 1 hereto sets forth the Certificate of Incorporation of MTI
from and after the effective time of the Merger.
<PAGE>
IN WITNESS WHEREOF, Acquisition has caused this Certificate to be
signed the 15th day of October, 1996.
MT ACQUISITION CORP.
By: /s/ Thomas P. Salice
------------------------------
Name: Thomas P. Salice
Title: Vice President
ATTEST:
By: /s/ Christine J. Smith
-----------------------------
Name: Christine J. Smith
Title: Secretary
<PAGE>
CERTIFICATE OF INCORPORATION
OF
METTLER-TOLEDO, INC.
Mettler-Toledo, Inc., a corporation organized and existing under the
laws of the State of Delaware, does hereby certify:
FIRST: The name of the Corporation is
METTLER-TOLEDO, INC.
SECOND: The address of the Corporation's registered office in the
State of Delaware is Corporation Trust Center, 1209 Orange Street, in the City
of Wilmington, County of New Castle. The name of its registered agent at such
address is The Corporation Trust Company.
THIRD: The purpose of the Corporation is to engage in any lawful act
or activity for which corporations may be organized under the General
Corporation Law of Delaware.
FOURTH: The total number of shares of stock which the Corporation
shall have authority to issue is One Thousand (1,000) shares of Common Stock,
and the par value of each such share is One Dollar ($1.00).
FIFTH: Elections of directors need not be by ballot unless the By-Laws
of the Corporation shall so provide.
SIXTH: The Board of Directors of the Corporation may make By-Laws and
from time to time may alter, amend or repeal By-Laws.
<PAGE>
SEVENTH: To the fullest extent permitted by the Delaware General
Corporation Law as the same exists or may hereafter be amended, a Director of
the Corporation shall not be liable to the Corporation or its stockholders for
monetary damages for breach of fiduciary duty as a Director.
<PAGE>
EXHIBIT 4.1
<PAGE>
================================================================================
--------------
MT Acquisition Corp., as Issuer
and
Mettler-Toledo Holding Inc., as Note Guarantor,
and
United States Trust Company of New York, as Trustee
--------------
INDENTURE
Dated as of October 15, 1996
--------------
$135,000,000
9 3/4% Senior Subordinated Notes due 2006
================================================================================
<PAGE>
TABLE OF CONTENTS
Page
----
ARTICLE ONE
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
Section 1.01. Definitions................................................ 1
Section 1.02. Incorporation by Reference of Trust Indenture
Act........................................................ 31
Section 1.03. Rules of Construction...................................... 32
ARTICLE TWO
THE NOTES
Section 2.01. Forms and Dating........................................... 33
Section 2.02. Execution and Authentication............................... 34
Section 2.03. Registrar and Paying Agent................................. 34
Section 2.04. Paying Agent to Hold Money in Trust........................ 35
Section 2.05. Noteholder Lists........................................... 35
Section 2.06. Transfer and Exchange...................................... 36
Section 2.07. Replacement Notes.......................................... 38
Section 2.08. Outstanding Notes.......................................... 39
Section 2.09. Treasury Notes............................................. 39
Section 2.10. Temporary Notes............................................ 39
Section 2.11. Cancellation............................................... 40
Section 2.12. Defaulted Interest......................................... 40
Section 2.13. CUSIP Number............................................... 41
Section 2.14. Deposit of Moneys.......................................... 41
Section 2.15. Computation of Interest.................................... 41
ARTICLE THREE
REDEMPTION OF NOTES
Section 3.01. Notices to the Trustee..................................... 41
Section 3.02. Selection of Notes to Be Redeemed.......................... 41
Section 3.03. Notice of Redemption....................................... 42
Section 3.04. Effect of Notice of Redemption............................. 43
Section 3.05. Deposit of Redemption Price................................ 43
Section 3.06. Notes Redeemed or Purchased in Part........................ 44
ii
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Page
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ARTICLE FOUR
COVENANTS
Section 4.01. Payment of Notes........................................... 44
Section 4.02. Maintenance of Office or Agency............................ 45
Section 4.03. Corporate Existence........................................ 45
Section 4.04. Payment of Taxes and Other Claims.......................... 46
Section 4.05. Maintenance of Properties.................................. 46
Section 4.06. Compliance Certificate; Notice of Default.................. 47
Section 4.07. Waiver of Stay, Extension or Usury Laws.................... 47
Section 4.08. Limitation on Indebtedness................................. 47
Section 4.09. Limitation on Restricted Payments.......................... 55
Section 4.10. Limitation on Transactions with Affiliates................. 61
Section 4.11. Limitation on Certain Liens................................ 62
Section 4.12. Limitation on Certain Guarantees........................... 63
Section 4.13. Certain Future Note Guarantors............................. 64
Section 4.14. Limitation on Other Senior Subordinated
Indebtedness............................................... 65
Section 4.15. Limitation on the Sale or Issuance of
Preferred Stock of Restricted Subsidiaries................. 65
Section 4.16. Limitation on Dividend and Other Payment
Restrictions Affecting Restricted Subsidiaries............. 66
Section 4.17. Restriction on Transfer of Assets to
Subsidiaries............................................... 67
Section 4.18. Limitation on Disposition of Proceeds of Asset
Sales...................................................... 68
Section 4.19. Change of Control.......................................... 71
Section 4.20. Reporting Requirements..................................... 74
ARTICLE FIVE
SUCCESSOR CORPORATION
Section 5.01. Merger, Consolidation and Sale of Assets................... 75
Section 5.02. Successor Substituted...................................... 77
ARTICLE SIX
REMEDIES
Section 6.01. Events of Default.......................................... 77
Section 6.02. Acceleration............................................... 80
Section 6.03. Other Remedies............................................. 82
Section 6.04. Waiver of Past Defaults.................................... 83
iii
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Page
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Section 6.05. Control by Majority........................................ 83
Section 6.06. Limitation on Suits........................................ 83
Section 6.07. Right of Holders to Receive Payment........................ 84
Section 6.08. Collection Suit by Trustee................................. 84
Section 6.09. Trustee May File Proofs of Claims.......................... 84
Section 6.10. Priorities................................................. 85
Section 6.11. Undertaking for Costs...................................... 85
Section 6.12. Restoration of Rights and Remedies......................... 86
ARTICLE SEVEN
TRUSTEE
Section 7.01. Duties..................................................... 86
Section 7.02. Rights of Trustee.......................................... 87
Section 7.03. Individual Rights of Trustee............................... 89
Section 7.04. Trustee's Disclaimer....................................... 89
Section 7.05. Notice of Default.......................................... 89
Section 7.06. Money Held in Trust........................................ 89
Section 7.07. Reports by Trustee to Holders.............................. 89
Section 7.08. Compensation and Indemnity................................. 90
Section 7.09. Replacement of Trustee..................................... 91
Section 7.10. Successor Trustee by Merger, etc........................... 92
Section 7.11. Eligibility; Disqualification.............................. 93
Section 7.12. Preferential Collection of Claims Against
Company.................................................... 93
ARTICLE EIGHT
SATISFACTION AND DISCHARGE OF INDENTURE
Section 8.01. Termination of the Company's Obligations................... 93
Section 8.02. Defeasance and Covenant Defeasance......................... 95
Section 8.03. Application of Trust Money................................. 99
Section 8.04. Repayment to Company or Note Guarantors.................... 99
Section 8.05. Reinstatement.............................................. 100
ARTICLE NINE
AMENDMENTS, SUPPLEMENTS AND WAIVERS
Section 9.01. Without Consent of Holders................................. 100
Section 9.02. With Consent of Holders.................................... 101
Section 9.03. Compliance with Trust Indenture Act........................ 103
iv
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Page
----
Section 9.04. Revocation and Effect of Consents.......................... 103
Section 9.05. Notation on or Exchange of Notes........................... 104
Section 9.06. Trustee May Sign Amendments, etc. ......................... 104
ARTICLE TEN
GUARANTEE OF NOTES
Section 10.01. Note Guarantee............................................. 105
Section 10.02. Execution and Delivery by Holding of Note
Guarantee.................................................. 107
Section 10.03. Additional Note Guarantors................................. 108
Section 10.04. Note Guarantee Obligations Subordinated to
Guarantor Senior Indebtedness.............................. 108
Section 10.05. Payment Over of Proceeds upon Dissolution,
etc. ...................................................... 109
Section 10.06. Suspension of Note Guarantee Obligations When
Guarantor Senior Indebtedness in Default................... 110
Section 10.07. Release of Note Guarantee.................................. 111
Section 10.08. Waiver of Subrogation...................................... 112
Section 10.09. Provisions Solely to Define Relative Rights................ 112
Section 10.10. Trustee to Effectuate Subordination........................ 113
Section 10.11. No Waiver of Subordination Provisions...................... 114
Section 10.12. Notice to Trustee.......................................... 115
Section 10.13. Reliance on Judicial Order or Certificate of
Liquidating Agent Regarding Dissolution, etc. ............. 116
Section 10.14. Rights of Trustee as a Holder of Guarantor
Senior Indebtedness; Preservation of Trustee's
Rights..................................................... 116
Section 10.15. Article Ten Applicable to Paying Agents.................... 116
Section 10.16. No Suspension of Remedies.................................. 117
Section 10.17. Trustee's Relation to Guarantor Senior
Indebtedness............................................... 117
Section 10.18. Subrogation................................................ 117
ARTICLE ELEVEN
SUBORDINATION OF NOTES
Section 11.01. Notes Subordinate to Senior Indebtedness................... 118
Section 11.02. Payment over of Proceeds upon Dissolution,
etc. ...................................................... 118
Section 11.03. Suspension of Payment When Senior Indebtedness
in Default................................................. 120
Section 11.04. Trustee's Relation to Senior Indebtedness.................. 122
v
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Page
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Section 11.05. Subrogation to Rights of Holders of Senior
Indebtedness.............................................. 122
Section 11.06. Provisions Solely to Define Relative Rights............... 123
Section 11.07. Trustee to Effectuate Subordination....................... 124
Section 11.08. No Waiver of Subordination Provisions..................... 124
Section 11.09. Notice to Trustee......................................... 125
Section 11.10. Reliance on Judicial Order or Certificate of
Liquidating Agent......................................... 126
Section 11.11. Rights of Trustee as a Holder of Senior
Indebtedness; Preservation of Trustee's Rights............ 127
Section 11.12. Article Applicable to Paying Agents....................... 127
Section 11.13. No Suspension of Remedies................................. 127
ARTICLE TWELVE
MISCELLANEOUS
Section 12.01. Trust Indenture Act of 1939............................... 127
Section 12.02. Notices................................................... 128
Section 12.03. Communication by Holders with Other Holders............... 129
Section 12.04. Certificate and Opinion as to Conditions
Precedent................................................. 129
Section 12.05. Statements Required in Certificate or Opinion............. 129
Section 12.06. Rules by Trustee, Paying Agent, Registrar................. 130
Section 12.07. Legal Holiday............................................. 130
Section 12.08. Governing Law............................................. 130
Section 12.09. No Recourse Against Others................................ 130
Section 12.10. Successors................................................ 130
Section 12.11. Multiple Originals........................................ 130
Section 12.12. Separability.............................................. 131
Section 12.13. Table of Contents, Headings, etc. ........................ 131
Section 12.14. Benefits of Indenture..................................... 131
SIGNATURES................................................................ 132
SCHEDULE 1 Existing Liens
SCHEDULE 2 Existing Indebtedness
EXHIBIT A Form of Note
EXHIBIT B Form of First Supplemental Indenture
vi
<PAGE>
Reconciliation and tie between Trust Indenture Act of 1939
and Indenture, dated as of the date hereof
TRUST INDENTURE INDENTURE
ACT SECTION SECTION
- ---------------------------- ---------------
Section 310(a)(1) ........................ 7.11
(a)(2) ........................ 7.11
(a)(3) ........................ N.A.
(a)(4) ........................ N.A.
(a)(5) ........................ 7.11
(b) ........................ 7.09; 7.11;
12.02
(c) ........................ N.A.
Section 311(a) ........................ 7.12
(b) ........................ 7.12
(c) ........................ N.A.
Section 312(a) ........................ 2.05
(b) ........................ 12.03
(c) ........................ 12.03
Section 313(a) ........................ 7.07
(b) ........................ 7.07
(c) ........................ 7.07; 12.02
(d) ........................ 7.07
Section 314(a) ........................ 4.06; 4.20;
12.02
(b) ........................ N.A.
(c)(1) ........................ 12.04
(c)(2) ........................ 12.04
(c)(3) ........................ N.A.
(d) ........................ N.A.
(e) ........................ 12.05
(f) ........................ N.A.
Section 315(a) ........................ 7.01(b),(c)
(b) ........................ 7.05; 12.02
(c) ........................ 7.01(a)
(d) ........................ 7.01(c)
(e) ........................ 6.11
Section 316(a) (last
sentence) ........................ 2.09
(a)(1)(A) ........................ 6.05
(a)(1)(B) ........................ 6.04
(a)(2) ........................ N.A.
(b) ........................ 6.07
Section 317(a)(1) ........................ 6.08
(a)(2) ........................ 6.09
(b) ........................ 2.04
Section 318(a) ........................ 12.01
- ----------
Note: This reconciliation and tie shall not, for any purpose, be deemed to be a
part of this Indenture.
<PAGE>
INDENTURE, dated as of October 15, 1996, between MT ACQUISITION
CORP., a corporation incorporated under the laws of the State of Delaware
(together with its successors, the "Company"), as issuer, METTLER-TOLEDO HOLDING
INC., a corporation incorporated under the laws of the State of Delaware, as
guarantor, and UNITED STATES TRUST COMPANY OF NEW YORK, as trustee (the
"Trustee").
Each party hereto agrees as follows for the benefit of each other
party and for the equal and ratable benefit of the Holders of the Company's
9 3/4% Senior Subordinated Notes due 2006 (the "Notes").
ARTICLE ONE
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
Section 1.01. Definitions.
"Acquired Indebtedness" means (x) Indebtedness of a Person existing
at the time such Person was acquired by the Company or (y) Indebtedness of a
Person assumed by the Company or a Restricted Subsidiary in connection with its
acquisition of assets from such Person, in each case other than Indebtedness
Incurred in connection with, or in contemplation of the transaction or series of
related transactions pursuant to which such Person became a Subsidiary or such
assets were so acquired by the Company or a Restricted Subsidiary.
"Acquisition" means the acquisition pursuant to the Stock Purchase
Agreement, dated as of April 2, 1996, between MT Investors (formerly named AEA
MT Inc.), AG fur Prazisioninstrumente, Greifensee, Switzerland and Ciba-Geigy
AG, as amended to the Issue Date.
"Acquisition Indebtedness" means Indebtedness of a Restricted
Subsidiary (x) Incurred solely for the purpose of financing the acquisition of
the Capital Stock of a Person that after giving effect to such acquisition will
be a Restricted Subsidiary, or assets constituting substantially all of a
separate division or separate business unit of a Person, and (y) the proceeds of
which (net of fees and expenses (including fees and expenses of legal counsel
and investment banks) directly related to such Incurrence) are used to pay the
purchase price for such Capital Stock or assets.
<PAGE>
"AEA" means AEA Investors Inc., a Delaware corporation, or any legal
successor thereto as a result of a reorganization thereof that does not involve
any change in control thereof.
"Affiliate" of any specified Person means any other Person, directly
or indirectly, controlling or controlled by or under direct or indirect common
control with such specified Person. For the purposes of this definition,
"control" when used with respect to any Person means the power to direct the
management and policies of such Person, directly or indirectly, whether through
the ownership of voting securities, by contract or otherwise; and the terms
"controlling" and "controlled" have meanings correlative to the foregoing. For
purposes of Section 4.10 only, "Affiliate" shall also mean any Beneficial Owner
of shares representing 10% or more of the total voting power of the Voting Stock
(on a fully diluted basis) of the Company, and any Person who would be an
Affiliate of any such Beneficial Owner pursuant to the first sentence hereof.
"Agent" means any Registrar or Paying Agent of the Notes.
"Asset Sale" means any sale, issuance, conveyance, transfer, lease
or other disposition (including by merger, consolidation or otherwise) by the
Company or any Restricted Subsidiary, in one or a series of related
transactions, of: (a) any Capital Stock of any Subsidiary of the Company; (b)
all or substantially all of the properties and assets of any division or line of
business of the Company or any Restricted Subsidiary; or (c) other than in the
ordinary course of business, any properties or assets of the Company or a
Restricted Subsidiary. For the purposes of this definition, the term "Asset
Sale" shall not include any sale, issuance, conveyance, transfer, lease or other
disposition of properties or assets (i) to the Company or any Restricted
Subsidiary, (ii) that is governed by Section 5.01, (iii) in one transaction or a
series of related transactions, involving assets with a Fair Market Value not in
excess of $2,500,000 or (iv) involving assets with a Fair Market Value not in
excess of $5,000,000 for all such dispositions in the aggregate in any fiscal
year.
"Attributable Debt" in respect of a Sale/Leaseback Transaction
means, as at the time of determination, the present value (discounted at the
interest rate assumed in making calculations in accordance with FAS 13) of the
total obligations of the lessee for rental payments during the
2
<PAGE>
remaining term of the lease included in such Sale/Leaseback Transaction
(including any period for which such lease has been extended).
"Average Life" means, with respect to any Indebtedness, as at any
date of determination, the quotient obtained by dividing (a) the sum of the
products of (i) the number of years from such date to the date or dates of each
successive scheduled principal payment (including, without limitation, any
sinking fund requirements) of such Indebtedness multiplied by (ii) the amount of
each such principal payment by (b) the sum of all such principal payments.
"Bank Agent" means The Bank of Nova Scotia or any successor or
replacement administrative agent under the Credit Agreement.
"Bankruptcy Law" means Title 11 of the United States Code or any
similar federal, state or foreign law for the relief of debtors.
"Beneficial Owner" means a "beneficial owner" as defined in Rules
13d-3 and 13d-5 under the Exchange Act, except that a Person shall be deemed to
be a "beneficial owner" of all securities that such Person has the right to
acquire, whether that right is exercisable immediately or only after the passage
of time.
"Board of Directors" means the Board of Directors of the Company or
a designated committee thereof.
"Board Resolution" means a copy of a resolution certified by the
Secretary of the Company or any Note Guarantor, as the case may be, to have been
duly adopted by the Board of Directors or the board of directors (or designated
committee thereof) of the relevant Note Guarantor and to be in full force and
effect on the date of such certification, and delivered to the Trustee.
"Business Day" means a day other than a Saturday, Sunday or any
other day on which banking institutions in New York State are authorized or
required by law to close.
"Capital Expenditure Indebtedness" means any Indebtedness of the
Company or any Restricted Subsidiary (whether consisting of Capitalized Lease
Obligations, Purchase Money Obligations or otherwise) Incurred (x) for the
purpose of financing all or any part of the purchase
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price, cost of construction or improvement of any fixed or capital assets used
in a Related Business and (y) no later than 180 days after the date of such
acquisition or the date of completion of such construction or improvement.
"Capital Stock" of any Person means any and all shares of, rights to
purchase, warrants or options for, or participations or other interests in
(however designated) equity of such Person, including Preferred Stock, but
excluding any debt securities convertible into such equity.
"Capitalized Lease Obligations" means an obligation that is required
to be classified and accounted for as a capitalized lease for financial
reporting purposes in accordance with GAAP, and the amount of Indebtedness
represented by such obligation shall be the capitalized amount of such
obligation determined in accordance with GAAP; and the Stated Maturity thereof
shall be the date of the last payment of rent or any other amount due under such
lease.
"Cash Equivalents" means (i) any security, maturing not more than
one year after the date of acquisition, issued by the United States of America,
or an instrumentality or agency thereof and guaranteed fully as to principal,
premium, if any, and interest by the United States of America; (ii) any
certificate of deposit, time deposit or bankers' acceptance (or, with respect to
non-U.S. banking institutions, similar instruments), maturing not more than one
year after the day of acquisition, issued by any commercial banking institution
that is a member of the Federal Reserve System or a commercial banking
institution organized and located in a country recognized by the United States
of America, in each case, having combined capital and surplus and undivided
profits of not less than $500,000,000 (or the foreign currency equivalent
thereof), whose short-term debt has a rating, at the time as of which any
investment therein is made, of "P-1" (or higher) according to Moody's or "A-1"
(or higher) according to S&P; (iii) commercial paper maturing not more than one
year after the date of acquisition issued by a corporation (other than an
Affiliate or Subsidiary of the Company) with a rating, at the time as of which
any investment therein is made, of "P-1" (or higher) according to Moody's or
"A-1" (or higher) according to S&P; (iv) any money market deposit accounts
issued or offered by a commercial banking institution that is a member of the
Federal Reserve System or a commercial banking institution organized and located
in a country recognized by the United States of America, in each case,
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having combined capital and surplus and undivided profits in excess of
$500,000,000 (or the foreign currency equivalent thereof); and (v) other
short-term investments utilized by Non-U.S. Restricted Subsidiaries in
accordance with normal investment practices for cash management not exceeding
$5,000,000 in aggregate principal amount outstanding at any time.
"Change of Control" has the meaning set forth in Section 4.19(b).
"Commodities Agreements" means one or more of the following
agreements entered into by a Person and one or more financial institutions:
commodity future contracts, forward contracts, options or other similar
agreements or arrangements designed to protect against fluctuations in the price
of, or the shortage of supply of, commodities from time to time.
"Company" means MT Acquisition Corp., a Delaware corporation, and
upon consummation of the Merger, means Mettler-Toledo, Inc., a Delaware
corporation, the survivor of the Merger, until a successor Person shall have
become such pursuant to Article Five, and thereafter "Company" shall mean such
successor Person.
"Consolidated Assets" means the total assets of the Company and its
Restricted Subsidiaries shown on the Consolidated balance sheet of the Company
and its Restricted Subsidiaries prepared in accordance with GAAP as of the last
day of the immediately preceding fiscal quarter.
"Consolidated Coverage Ratio" as of any date of determination means
the ratio of (i) the aggregate amount of EBITDA for the period of the most
recent four consecutive fiscal quarters ending prior to the date of such
determination for which consolidated financial statements of the Company are
available to (ii) Consolidated Interest Expense for such four fiscal quarters,
provided, however, that:
(1) if the Company or any Restricted Subsidiary (x) has Incurred any
Indebtedness since the beginning of such period that remains outstanding
on such date of determination or if the transaction giving rise to the
need to calculate the Consolidated Coverage Ratio is an Incurrence of
Indebtedness, EBITDA and Consolidated Interest Expense for such period
shall be calculated after giving effect on a pro forma basis to such
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Indebtedness and the application of the proceeds thereof as if such
Indebtedness had been Incurred on the first day of such period or (y) has
repaid, repurchased, defeased or otherwise discharged any Indebtedness
since the beginning of the period that is no longer outstanding on such
date of determination, or if the transaction giving rise to the need to
calculate the Consolidated Coverage Ratio involves a discharge of
Indebtedness, EBITDA and Consolidated Interest Expense for such period
shall be calculated after giving effect to such discharge of such
Indebtedness, including with the proceeds of such new Indebtedness, as if
such discharge had occurred on the first day of such period (except that,
in making such computation, the amount of Indebtedness under any revolving
credit facility shall be computed based upon the average daily balance of
such Indebtedness during such four-quarter period);
(2) if since the beginning of such period the Company or any
Restricted Subsidiary shall have disposed of any company or any business
or any group of assets constituting an operating unit (a "Disposal"), (x)
EBITDA for such period shall be reduced by an amount equal to the EBITDA
(if positive) directly attributable to the assets which are the subject of
such Disposal for such period or increased by an amount equal to the
EBITDA (if negative) directly attributable thereto for such period and (y)
Consolidated Interest Expense for such period shall be reduced by an
amount equal to the Consolidated Interest Expense directly attributable to
any Indebtedness of the Company or any Restricted Subsidiary repaid,
repurchased, defeased or otherwise discharged with respect to the Company
and its continuing Restricted Subsidiaries in connection with such
Disposal for such period (and, if the Capital Stock of any Restricted
Subsidiary is sold, the Consolidated Interest Expense for such period
directly attributable to the Indebtedness of such Restricted Subsidiary to
the extent the Company and its continuing Restricted Subsidiaries are no
longer liable for such Indebtedness after such sale);
(3) if since the beginning of such period the Company or any
Restricted Subsidiary (by merger or otherwise) shall have acquired any
company or any business or any group of assets constituting an operating
unit (for purposes of this definition, an "Acquisition"), EBITDA and
Consolidated Interest Expense for such period shall be calculated after
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giving pro forma effect thereto (including the Incurrence of any
Indebtedness) as if such Acquisition had occurred on the first day of such
period; and
(4) if since the beginning of such period any Person (that
subsequently became a Restricted Subsidiary or was merged with or into the
Company or any Restricted Subsidiary since the beginning of such period)
shall have made any Disposal or Acquisition that would have required an
adjustment pursuant to clause (2) or (3) above if made by the Company or a
Restricted Subsidiary during such period, EBITDA and Consolidated Interest
Expense for such period shall be calculated after giving pro forma effect
thereto as if such Disposal or Acquisition occurred on the first day of
such period.
If any Indebtedness bears a floating rate of interest and is being
given pro forma effect, the interest expense on such Indebtedness shall be
calculated as if the rate in effect on the date of determination had been the
applicable rate for the entire period (taking into account any Interest Rate
Agreement applicable to such Indebtedness if such Interest Rate Agreement has a
remaining term as at the date of determination in excess of 12 months). If any
Indebtedness bears, at the option of the Company or a Restricted Subsidiary, a
fixed or floating rate of interest and is being given pro forma effect, the
interest expense on such Indebtedness shall be computed by applying, at the
option of the Company, either a fixed or floating rate. If any Indebtedness
which is being given pro forma effect was Incurred under a revolving credit
facility, the interest expense on such Indebtedness shall be computed based upon
the average daily balance of such Indebtedness during the applicable period. In
making any calculation of the Consolidated Coverage Ratio for any period prior
to the date of the closing of the Acquisition, the Acquisition shall be deemed
to have taken place on the first day of such period.
"Consolidated Income Tax Expense" means for any period, as applied
to any Person, the provision for federal, state, local and foreign income taxes
and capital taxes of such Person and its Consolidated Subsidiaries for such
period as recorded under "provision for taxes" on the statement of operations as
determined in accordance with GAAP.
"Consolidated Interest Expense" means, for any period, the total
interest expense of the Company and its
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Consolidated Subsidiaries, as determined in accordance with GAAP, plus, to the
extent Incurred by the Company and its Restricted Subsidiaries in such period
but not included in such interest expense, (i) amortization of debt discount
(including amortization of fees), (ii) the interest portion of any deferred
payment obligation which in accordance with GAAP is required to be reflected on
an income statement, (iii) net costs (including amortization of discounts and
fees) associated with Interest Rate Agreements or Currency Agreements (other
than Currency Agreements permitted by Section 4.08(b)(viii)(B)), (iv) interest
accruing on any Indebtedness of any other Person that is Guaranteed by the
Company or any Restricted Subsidiary, (v) all commissions, discounts and other
fees and charges with respect to letters of credit and bankers' acceptance
financing, (vi) all accrued interest, (vii) the aggregate dividends paid or
accrued on Preferred Stock held by Persons other than the Company or a Wholly
Owned Subsidiary, (viii) the interest component of Capitalized Lease Obligations
paid, accrued and/or scheduled to be paid by the Company and the Restricted
Subsidiaries during such period as determined on a consolidated basis in
accordance with GAAP, and (ix) the cash contributions to any employee stock
ownership plan or similar trust to the extent such contributions are used by
such plan or trust to pay interest or fees to any Person (other than the
Company) in connection with Indebtedness Incurred by such plan or trust.
"Consolidated Net Income" means, for any period, the net income
(loss) of the Company and its Consolidated Subsidiaries, as determined in
accordance with GAAP; provided, however, that there shall not be included in
such Consolidated Net Income: (i) any net income of any Person that is not the
Company or a Restricted Subsidiary, except that, subject to limitations
contained in clause (iv) below, the Company's equity in the net income of any
such Person for such period shall be included in such Consolidated Net Income up
to the aggregate amount of cash actually distributed by such Person during such
period to the Company or a Restricted Subsidiary as a dividend or other
distribution (subject, in the case of a dividend or other distribution to a
Restricted Subsidiary, to the limitations contained in clause (iii) below); (ii)
any net income or loss of any Person acquired by the Company or a Subsidiary in
a pooling of interests transaction for any period prior to the date of such
acquisition; (iii) any net income of any Restricted Subsidiary if such
Subsidiary is subject to restrictions, directly or indirectly, on the payment of
dividends or the making of distributions by such Restricted
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Subsidiary, directly or indirectly, to the Company, except that, subject to the
limitations contained in (iv) below, the Company's equity in the net income of
any such Restricted Subsidiary for such period shall be included in such
Consolidated Net Income up to the aggregate amount of cash that could have been
distributed by such Restricted Subsidiary during such period to the Company or
another Restricted Subsidiary as a dividend (subject, in the case of a dividend
that could have been made to another Restricted Subsidiary, to the limitation
contained in this clause); (iv) any gain or loss realized upon any Asset Sale
and any gain or loss realized upon the sale or other disposition of any Capital
Stock of any Person; (v) any extraordinary gain or loss as recorded on the
statement of operations in accordance with GAAP; (vi) the cumulative effect of a
change in accounting principles as recorded on the statement of operations in
accordance with GAAP; (vii) all deferred financing costs written off in
connection with the early extinguishment of indebtedness under the Credit
Agreement or the Notes as recorded on the statement of operations in accordance
with GAAP; (viii) any charge relating to the closure of the Westerville, Ohio
facility as recorded on the statement of operations in accordance with GAAP;
(ix) nonrecurring charges related to the Acquisition and any other acquisition
by the Company or any Restricted Subsidiary occurring after the Issue Date as
recorded on the statement of operations in accordance with GAAP; (x) non-cash,
nonrecurring charges as recorded on the statement of operations in accordance
with GAAP; (xi) unrealized gains or losses in respect of Currency Agreements
permitted by Section 4.08(b)(viii)(B) as recorded on the statement of operations
in accordance with GAAP; (xii) unrealized foreign currency transaction gains or
losses in respect of Indebtedness of any Person denominated in a currency other
than the functional currency of such Person and permitted to be Incurred under
Section 4.08 as recorded on the statement of operations in accordance with GAAP;
and (xiii) any expense relating to bonuses paid by Ciba-Geigy AG or its
Affiliates (other than an Affiliate that will be an Affiliate of the Company
following consummation of the Acquisition) to employees of the Company or any
Restricted Subsidiary pursuant to agreements entered into in connection with the
disposition of the Mettler-Toledo Group by Ciba-Geigy AG, as recorded on the
statement of operations in accordance with GAAP; provided that in the case of
any amount or charge specified in clause (vii), (viii), (ix), (x), (xi), (xii)
or (xiii), such amount or charge shall be net of any tax or tax benefit to the
Company or any of its Consolidated Subsidiaries resulting therefrom.
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"Consolidated Non-Cash Charges" of any Person means, for any period,
the aggregate depreciation, amortization and other non-cash charges of such
Person and its Consolidated Subsidiaries for such period, on a Consolidated
basis, as determined in accordance with GAAP (excluding any non-cash charge that
requires an accrual or reserve for cash charges for any future period).
"Consolidation" means the consolidation of the amounts of each of
the Restricted Subsidiaries with those of the Company in accordance with GAAP
consistently applied; provided, however, that "Consolidation" will not include
consolidation of the accounts of any Unrestricted Subsidiary, but the interest
of the Company or any Restricted Subsidiary in an Unrestricted Subsidiary will
be accounted for as an investment. The term "Consolidated" has a correlative
meaning.
"Corporate Trust Office" means the corporate trust office of the
Trustee at which at any particular time its corporate trust business shall be
principally administered, which on the date hereof is 114 West 47th Street, New
York, New York 10036, Attention: Corporate Trust Division.
"covenant defeasance" has the meaning set forth in Section 8.02.
"Credit Agreement" means the Credit Agreement, dated as of the date
hereof, among the Company and Swiss Subholding, as borrowers, Merrill Lynch
Capital Corporation, as agent and arranger, The Bank of Nova Scotia, as
administrative agent, Credit Suisse and Lehman Commercial Paper Inc., as
co-agents, and the other financial institutions which are to become parties from
time to time thereto, as such agreement may be amended, modified, supplemented,
renewed, refunded, replaced, increased or refinanced (in whole or in part) from
time to time by one or more instruments or agreements with the same or other, or
any combination of the same and other, lenders and, in each case, including,
without limitation, any related notes, letters of credit and applications
therefor, guarantees, collateral documents, instruments and agreements executed
in connection therewith, in each case as amended, modified, supplemented,
renewed, refunded, replaced, increased or refinanced (in whole or in part) from
time to time by one or more instruments or agreements. Without limiting the
generality of the foregoing, the term "Credit Agreement" shall, subject to the
covenants of this Indenture, include any agreement (i) changing the maturity of
any Indebtedness
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incurred thereunder or contemplated thereby, (ii) adding Subsidiaries of the
Company as additional borrowers or guarantors thereunder, (iii) increasing the
amount of Indebtedness incurred thereunder or available to be borrowed
thereunder or (iv) otherwise altering the terms and conditions thereof.
"Credit Agreement Obligations" means all monetary obligations of
every nature of the Company or a Restricted Subsidiary, including, without
limitation, obligations to pay principal and interest, reimbursement obligations
under letters of credit, fees, expenses and indemnities, from time to time owed
to the lenders or any agent under or in respect of the Credit Agreement.
"Currency Agreement" means in respect of any Person any foreign
exchange contract, currency swap agreement or other similar agreement as to
which such Person is a party or a beneficiary.
"Custodian" means any receiver, trustee, assignee, liquidator,
sequestrator or similar official under any Bankruptcy Law.
"Default" means any event that is, or after notice or passage of
time, or both, would be, an Event of Default.
"defeasance" has the meaning set forth in Section 8.02.
"Depository" shall mean The Depository Trust Company, New York, New
York, its nominees and their respective successors thereto registered under the
Exchange Act or other applicable statute or regulation.
"Designated Senior Indebtedness" means (i) all Senior Indebtedness
and Guarantor Senior Indebtedness under the Credit Agreement Obligations and
(ii) if no Senior Indebtedness or Guarantor Senior Indebtedness is outstanding
under the Credit Agreement Obligations or if the lenders under the Credit
Agreement shall have consented thereto, any other Senior Indebtedness (or for
certain purposes more fully described in this Indenture, Guarantor Senior
Indebtedness) which (a) at the time of incurrence exceeds $25,000,000 in
aggregate principal amount and (b) is specifically designated by the Company
(or, in the case of Guarantor Senior Indebtedness, by the relevant Note
Guarantor) in the instrument evidencing such Senior
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Indebtedness or Guarantor Senior Indebtedness as "Designated Senior
Indebtedness."
"Disinterested Director" means a member of the Board of Directors
who does not have any material direct or indirect financial interest in or with
respect to any transaction or series of transactions.
"Dollar" or "$" means the lawful money of the United States of
America.
"EBITDA" for any period means the sum of Consolidated Net Income,
Consolidated Interest Expense, Consolidated Income Tax Expense and Consolidated
Non-Cash Charges deducted in computing Consolidated Net Income, without
duplication, in each case for such period, of such Person and its Consolidated
Subsidiaries on a Consolidated basis, all determined in accordance with GAAP.
"Event of Default" has the meaning set forth under Section 6.01.
"Excess Proceeds" has the meaning set forth in Section 4.18(a).
"Excess Proceeds Offer" has the meaning set forth in Section
4.18(b).
"Excess Proceeds Offer Price" has the meaning set forth in Section
4.18(b).
"Excess Proceeds Purchase Date" has the meaning set forth in Section
4.18(c).
"Exchange Act" means the Securities Exchange Act of 1934, as
amended.
"Fair Market Value" means, with respect to any asset or property,
the price that could be negotiated in an arm's-length free market transaction,
for cash, between an informed and willing seller and an informed and willing
buyer, neither of whom is under undue pressure or compulsion to complete the
transaction.
"First Supplemental Indenture" means the First Supplemental
Indenture, to be entered into substantially in the form attached hereto as
Exhibit B.
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"GAAP" means generally accepted accounting principles in the United
States of America as in effect as of the Issue Date, including those set forth
in the opinions and pronouncements of the Accounting Principles Board of the
American Institute of Certified Public Accountants and statements and
pronouncements of the Financial Accounting Standards Board. All ratios and
computations based on GAAP contained in this Indenture shall be computed in
conformity with GAAP.
"Global Note" has the meaning set forth in Section 2.01(a).
"Guarantee" means any obligation, contingent or otherwise, of any
Person directly or indirectly guaranteeing any Indebtedness or other obligation
of any other Person and any obligation, direct or indirect, contingent or
otherwise, of such Person (i) to purchase or pay (or advance or supply funds for
the purchase or payment of) such Indebtedness or other obligation of such Person
(whether arising by virtue of partnership arrangements, or by agreement to keep
well, to purchase assets, goods, securities or services, to take-or-pay, or to
maintain financial statement conditions or otherwise) or (ii) entered into for
purposes of assuring in any other manner the obligee of such Indebtedness or
other obligation of the payment thereof or to protect such obligee against loss
in respect thereof (in whole or in part), provided, however, that the term
"Guarantee" shall not include endorsements for collection or deposit in the
ordinary course of business. The term "Guarantee" used as a verb has a
corresponding meaning.
"Guarantor Senior Indebtedness" means, with respect to any Note
Guarantor, the principal of, premium, if any, and interest (including interest
accruing subsequent to the filing of a petition of bankruptcy at the rate
provided for in the documentation with respect thereto, whether or not such
interest is an allowed claim under applicable state, federal or foreign law) on
and other amounts due on or in connection with (including any fees, premiums,
expenses, including costs of collection, and indemnities) any Indebtedness of
such Note Guarantor, whether outstanding on the Issue Date or thereafter
created, incurred or assumed, unless, in the case of any particular
Indebtedness, the instrument creating or evidencing the same or pursuant to
which the same is outstanding expressly provides that such Indebtedness shall
not be senior in right of payment to the Note Guarantee of such Note Guarantor.
Without limiting the generality of the foregoing, "Guarantor Senior
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Indebtedness" shall also include the principal of, premium, if any, and interest
(including any interest accruing subsequent to the filing of a petition of
bankruptcy at the rate provided for in the documentation with respect thereto,
whether or not such interest is an allowed claim under applicable state, federal
or foreign law) on, and all other amounts owing in respect of, (i) all Credit
Agreement Obligations of such Note Guarantor and (ii) all Related Currency and
Interest Rate Protection Obligations, if any, of such Note Guarantor, in each
case whether outstanding on the Issue Date or thereafter created, incurred or
assumed and including in respect of claims under guarantees, claims for
indemnity, claims in relation to Related Currency and Interest Rate Protection
Obligations, expense reimbursement and fees. Notwithstanding the foregoing,
"Guarantor Senior Indebtedness" shall not include (a) Indebtedness evidenced by
the Note Guarantee of such Note Guarantor, (b) Indebtedness that is pari passu
with or expressly subordinated or junior in right to payment to any Guarantor
Senior Indebtedness of such Note Guarantor, (c) Indebtedness which, when
incurred and without respect to any election under Section 1111(b) of Title 11,
United States Code, is by its terms without recourse to such Note Guarantor, (d)
any repurchase, redemption or other obligation in respect of Redeemable Capital
Stock of such Note Guarantor, (e) to the extent it might constitute
Indebtedness, amounts owing for goods, materials or services purchased in the
ordinary course of business or consisting of trade payables or other current
liabilities (other than any current liabilities owing under the Credit Agreement
Obligations or the current portion of any long-term Indebtedness which would
constitute Guarantor Senior Indebtedness but for the operation of this clause
(e)), (f) to the extent it might constitute Indebtedness, amounts owed by such
Note Guarantor for compensation to employees or for services rendered to such
Note Guarantor, (g) to the extent it might constitute Indebtedness, any
liability for federal, state, local, foreign or other taxes owed or owing by
such Note Guarantor, (h) Indebtedness of such Note Guarantor to a Subsidiary of
the Company and (i) that portion of any Indebtedness of such Note Guarantor
which at the time of Incurrence is Incurred in violation of this Indenture;
provided, however, that such Indebtedness shall be deemed not to have been
Incurred in violation of this Indenture for purposes of this clause (i) if (x)
the holder(s) of such Indebtedness or their representative or such Note
Guarantor shall have furnished to the Trustee an opinion of recognized
independent legal counsel, unqualified in all material respects, addressed to
the Trustee (which legal counsel may, as to matters of fact,
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rely upon an Officers' Certificate of such Note Guarantor) to the effect that
the Incurrence of such Indebtedness does not violate the provisions of this
Indenture or (y) such Indebtedness consists of Credit Agreement Obligations, and
the holder(s) of such Indebtedness or their agent or representative (1) had no
actual knowledge at the time of Incurrence that the Incurrence of such
Indebtedness violated this Indenture and (2) shall have received a certificate
from an Officer of such Note Guarantor to the effect that the Incurrence of such
Indebtedness does not violate the provisions of this Indenture.
"Holder" or "Noteholder" means the Person in whose name a Note is
registered on the Registrar's books.
"Holding" means Mettler-Toledo Holding Inc., a Delaware corporation,
and any successor thereto.
"Incur" means issue, assume, Guarantee, incur or otherwise become
liable for, provided, however, that any Indebtedness or Capital Stock of a
Person existing at the time such Person becomes a Subsidiary (whether by merger,
consolidation, acquisition or otherwise) shall be deemed to be Incurred by such
Person at the time it becomes a Subsidiary.
"Indebtedness" means, with respect to any Person, without
duplication, (a) all liabilities of such Person for borrowed money or for the
deferred purchase price of property or services, excluding any trade accounts
payable and other accrued current liabilities incurred in the ordinary course of
business, but including, without limitation, all obligations, contingent or
otherwise, of such Person in connection with any letters of credit, banker's
acceptance or other similar credit transaction, or in connection with any
agreement to purchase, redeem, exchange, convert or otherwise acquire for value
any Capital Stock of such Person, or any warrants, rights or options to acquire
such Capital Stock, now or hereafter outstanding, (b) all obligations of such
Person evidenced by bonds, notes, debentures or other similar instruments, (c)
all indebtedness of such Person created or arising under any conditional sale or
other title retention agreement with respect to property acquired by such Person
(even if the rights and remedies of the seller or lender under such agreement in
the event of default are limited to repossession or sale of such property), but
excluding trade accounts payable arising in the ordinary course of business, (d)
all Capitalized Lease Obligations and all Attributable
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Debt of such Person, (e) all Indebtedness referred to in the preceding clauses
of other Persons and all dividends of other Persons, the payment of which is
secured by (or for which the holder of such Indebtedness has an existing right,
contingent or otherwise, to be secured by) any Lien upon property (including,
without limitation, accounts and contract rights) owned by such Person, even
though such Person has not assumed or become liable for the payment of such
Indebtedness (the amount of such obligation being deemed to be the lesser of the
value of such property or asset or the amount of the obligation so secured), (f)
all Guarantees of such Person in respect of Indebtedness of another Person of
any of the types referred to in this definition, (g) all Redeemable Capital
Stock of such Person valued at the greater of its voluntary or involuntary
maximum fixed repurchase price plus accrued dividends, (h) all Currency
Agreements, Interest Rate Agreements and Commodities Agreements of such Person
and (i) any amendment, supplement, modification, deferral, renewal, extension or
refunding of any liability of such Person of any of the types referred to in
clauses (a) through (h) above. Notwithstanding the foregoing, Indebtedness shall
not include any Guarantee by the Company of the obligations of Ciba-Geigy AG or
its Affiliates under its Guarantee to the Pension Benefit Guaranty Corporation
with respect to any unfunded liabilities of any employee benefit plan of the
Company.
For purposes hereof, (x) the "maximum fixed repurchase price" of any
Redeemable Capital Stock that does not have a fixed repurchase price shall be
calculated in accordance with the terms of such Redeemable Capital Stock as if
such Redeemable Capital Stock were purchased on any date on which Indebtedness
shall be required to be determined pursuant to this Indenture, and if such price
is based upon, or measured by, the fair market value of such Redeemable Capital
Stock, such fair market value shall be determined in good faith by the board of
directors of the issuer of such Redeemable Capital Stock and (y) Indebtedness is
deemed to be incurred pursuant to a revolving credit facility each time an
advance is made thereunder. When any Person becomes a Restricted Subsidiary
there shall be deemed to have been an Incurrence by such Restricted Subsidiary
of all Indebtedness for which it is liable at the time it becomes a Restricted
Subsidiary. If the Company or any Restricted Subsidiary, directly or indirectly,
Guarantees Indebtedness of another Person, there shall be deemed to be an
Incurrence of such Guaranteed Indebtedness as if the
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Company or such Restricted Subsidiary had directly incurred or otherwise assumed
such Guaranteed Indebtedness.
"Indenture" means this Indenture, as amended, modified or
supplemented from time to time.
"Interest Payment Date" means the Stated Maturity of an installment
of interest on the Notes, as set forth therein.
"Interest Rate Agreement" means with respect to any Person any
interest rate protection agreement, interest rate future agreement, interest
rate option agreement, interest rate swap agreement, interest rate cap
agreement, interest rate collar agreement, interest rate hedge agreement or
other similar agreement or arrangement as to which such Person is party or a
beneficiary.
"Investment" in any Person means any direct or indirect advance,
loan (other than advances to customers in the ordinary course of business that
are recorded as accounts receivable on the balance sheet of such Person) or
other extension of credit (including by way of Guarantee or similar arrangement)
or capital contribution to (by means of any transfer of cash or other property
to others or any payment for property or services for the account or use of
others), or any purchase or acquisition of Capital Stock, Indebtedness or other
similar instruments issued by such Person. For purposes of the definition of
"Unrestricted Subsidiary" and Section 4.09, (i) "Investment" shall include the
portion (proportionate to the Company's equity interest in such Subsidiary) of
the Fair Market Value of the net assets of any Subsidiary of the Company at the
time that such Subsidiary is designated an Unrestricted Subsidiary; provided,
however, that upon a redesignation of such Subsidiary as a Restricted
Subsidiary, the Company shall be deemed to continue to have a permanent
"Investment" in an Unrestricted Subsidiary in an amount (if positive) equal to
(x) the Company's "Investment" in such Subsidiary at the time of such
redesignation less (y) the portion (proportionate to the Company's direct or
indirect equity interest in such Subsidiary) of the Fair Market Value of the net
assets of such Subsidiary at the time of such redesignation; and (ii) any
property transferred to or from an Unrestricted Subsidiary shall be valued at
its Fair Market Value at the time of such transfer, in each case, as determined
in good faith by the Board of Directors.
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"Issue Date" means the date on which the Notes are originally
issued.
"Lien" means any mortgage, pledge, security interest, hypothecation,
assignment, conveyance, preference, priority, encumbrance, lien (statutory or
other) or charge of any kind (including any conditional sale or other title
retention agreement or lease in the nature thereof).
"Management Services Agreement" means the Management Services
Agreement, dated the date hereof, between AEA and the Company, as in effect on
the Issue Date and as the same may be amended from time to time in any manner
not adverse to the Holders or in accordance with the procedures set forth in
Section 4.10(a).
"Maturity Date" means, with respect to any Note, the date on which
any principal of such Note becomes due and payable as therein or herein
provided, whether at the Stated Maturity with respect to such principal or by
declaration of acceleration, call for redemption or purchase (including pursuant
to an Excess Proceeds Offer or an offer in the event of a Change of Control) or
otherwise.
"Merger" means the merger of MT Acquisition Corp. with and into
Mettler-Toledo, Inc. immediately upon consummation of the Acquisition.
"Moody's" means Moody's Investors Service, Inc. or any successor
rating agency.
"MT Investors" means MT Investors Inc., a Delaware corporation, and
any successor thereto.
"Net Cash Proceeds" means, (a) with respect to any Asset Sale, the
proceeds thereof in the form of cash or Cash Equivalents, including payments in
respect of deferred payment obligations when received in the form of, or stock
or other assets when disposed for, cash or Cash Equivalents (except to the
extent that such obligations are financed or sold, but only to the extent they
continue to be, with recourse to the Company or any Restricted Subsidiary), net
of (i) brokerage commissions and other reasonable fees and expenses (including
fees and expenses of legal counsel and investment banks) actually incurred and
related to such Asset Sale, (ii) provisions for all taxes payable as a result of
such Asset Sale, (iii) amounts required to be paid to any Person (other than the
Company or any Restricted Subsidiary) owning a beneficial interest in the assets
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subject to the Asset Sale and (iv) appropriate amounts to be provided by the
Company or any Restricted Subsidiary, as the case may be, as a reserve required
in accordance with GAAP against any liabilities associated with such Asset Sale
and retained by the Company or any Restricted Subsidiary, as the case may be,
after such Asset Sale, and (b) with respect to any issuance or sale of Capital
Stock, means the proceeds of such issuance or sale in the form of cash or Cash
Equivalents, including payments in respect of deferred payment obligations when
received in the form of, or stock or other assets when disposed for, cash or
Cash Equivalents (except to the extent that such obligations are financed or
sold, but only to the extent they continue to be, with recourse to the Company
or any Restricted Subsidiary), net of (i) brokerage commissions and other
reasonable fees and expenses (including fees of legal counsel and investment
banks) actually incurred and related to such issuance or sale and (ii)
provisions for all taxes payable as a result of such issuance or sale; in each
case, as reflected in an Officers' Certificate delivered to the Trustee.
"Non-Dollar Indebtedness" means Indebtedness denominated in any
currency other than Dollars.
"Non-payment Default" means, for purposes of Article Eleven hereof,
any default (other than a Payment Default) with respect to any Designated Senior
Indebtedness pursuant to which the maturity thereof may be accelerated.
"Non-U.S. Restricted Subsidiary" means any Restricted Subsidiary of
the Company other than a U.S. Restricted Subsidiary.
"Note Amount" has the meaning set forth in Section 4.18(b).
"Note Guarantee" means the Guarantee of the Notes by Holding on the
terms of Article Ten hereof, and any Guarantee of the Notes on the terms of
Article Ten hereof that may from time to time be executed and delivered pursuant
to the terms of this Indenture. Each such Note Guarantee shall be in the form
prescribed in this Indenture.
"Note Guarantor" means any Person that has issued a Note Guarantee.
"Notes" means the Notes that are issued under this Indenture, as
amended or supplemented from time to time pursuant to this Indenture.
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"Offer Period" has the meaning set forth in Section 4.18(c).
"Officer" means the Chairman of the Board, Chief Executive Officer,
Chief Financial Officer (or Head, Finance and Control), the President, any Vice
President, the Treasurer or the Secretary of the Company or Holding, as the case
may be.
"Officers' Certificate" means a certificate signed by two Officers.
"Opinion of Counsel" means a written opinion in form and substance
reasonably satisfactory to the Trustee from legal counsel who is reasonably
acceptable to the Trustee. The counsel may be an employee of or counsel to the
Company or the Trustee.
"Pari Passu Indebtedness" means any Indebtedness of the Company or
any Note Guarantor ranking pari passu with the Notes or the applicable Note
Guarantee, respectively.
"Participants" has the meaning set forth in Section 2.06.
"Paying Agent" has the meaning set forth in Section 2.03, except
that, for the purposes of Sections 4.18 and 4.19 and Articles Three and Eight,
the Paying Agent shall not be the Company or a Subsidiary of the Company or any
of their respective Affiliates.
"Payment Blockage Period" shall have the meaning set forth in
Section 11.03.
"Payment Default" means any default in the payment when due (whether
at Stated Maturity, by acceleration or otherwise) of principal of or interest
on, or of unreimbursed amounts under drawn letters of credit or fees relating to
letters of credit constituting, any Senior Indebtedness or Guarantor Senior
Indebtedness, as applicable of the Company or any Note Guarantor.
"Permitted Guarantee" means (i) any Guarantee of Acquired
Indebtedness given by any Restricted Subsidiary prior to (and not in
contemplation of) the Incurrence of such Acquired Indebtedness by the Company or
a Restricted Subsidiary, which Guarantee and Acquired Indebtedness are Incurred
pursuant to clause (vi) of paragraph (b) (or, in the case of Acquired
Indebtedness of the Company,
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Section 4.08(a)) or (ii) any Guarantee by the Company of the obligations of
Ciba-Geigy AG or its Affiliates under its Guarantee to the Pension Benefit
Guaranty Corporation with respect to any unfunded liabilities of any employee
benefit plan of the Company.
"Permitted Holder" means AEA and its current, former and future
employees, stockholders, directors and officers and the Company's officers, and
(i) trusts for the benefit of such Persons or the spouses, issue, parents or
other relatives of such Persons, (ii) entities controlling or controlled by such
Persons and (iii) in the event of the death of any such individual Person, heirs
or testamentary legatees of such Person.
"Permitted Investment" means any of the following: (i) Investments
in Cash Equivalents, (ii) Investments in the Company or in any Restricted
Subsidiary (including any Person that thereby becomes a Restricted Subsidiary),
(iii) Investments in existence on the Issue Date, (iv) receivables owing to the
Company or any Restricted Subsidiary, if created or acquired in the ordinary
course of business and payable or dischargeable in accordance with customary
trade terms, (v) Interest Rate Agreements designed to protect the Company or any
Restricted Subsidiary against fluctuations in interest rates in respect of
Indebtedness of the Company or any Restricted Subsidiary, and Currency
Agreements designed to protect the Company or any Restricted Subsidiary against
fluctuations in foreign currency exchange rates in respect of foreign exchange
exposures incurred by the Company or any Restricted Subsidiary in the ordinary
course of business, in each case, permitted by Section 4.08, (vi) Investments in
the Notes, (vii) Investments in a joint venture or similar entity that is not a
Restricted Subsidiary and is primarily engaged in a Related Business, not to
exceed $20,000,000 at any time, (viii) Investments in securities of any Person
received pursuant to any plan of reorganization or similar arrangement upon the
bankruptcy or insolvency of such Person, (ix) Investments received by the
Company or its Restricted Subsidiaries as consideration for Asset Sales effected
in compliance with Section 4.18, (x) Investments in an amount not exceeding
$5,000,000 in the aggregate outstanding at any time, and (xi) any Investment in
Ciba-Geigy AG or any Affiliate thereof resulting from the advancement of amounts
not exceeding SFr 38 million equal to withholding taxes payable in connection
with dividends paid to Ciba-Geigy AG or any Affiliate thereof in connection with
the Acquisition, pending receipt of refund of such withholding taxes.
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"Permitted Junior Securities" means, (i) for purposes of Article
Eleven (so long as the effect of any exclusion employing this definition is not
to cause the Notes to be treated in any case or proceeding or similar event
described in clauses (a), (b) or (c) of Section 11.02 as part of the same class
of claims as the Senior Indebtedness or any class of claims pari passu with, or
senior to, the Senior Indebtedness for purposes of any payment or distribution)
debt or equity securities of the Company or any successor corporation provided
for by a plan of reorganization or readjustment that are subordinated at least
to the same extent that the Notes are subordinated to the payment of all Senior
Indebtedness; provided that (a) if a new corporation results from such
reorganization or readjustment, such corporation assumes any Senior
Indebtedness not paid in full in cash or Cash Equivalents in connection with
such reorganization or readjustment and (b) the rights of the holders of such
Senior Indebtedness are not, without the consent of such holders, altered or
impaired by such reorganization or readjustment, and (ii) for purposes of
Article Ten, any Guarantee by a Note Guarantor of a Permitted Junior Security of
the Company described in clause (i) above; provided that such Guarantee is
subordinated to the payment of all Guarantor Senior Indebtedness at least to the
same extent that the Note Guarantees are subordinated to the payment of all
Guarantor Senior Indebtedness, and such Guarantee is subject to provisions
substantially similar to those set forth in Article Ten.
"Permitted Lien" means (i) any Lien as existing on the Issue Date
and listed on Schedule 1 to this Indenture; (ii) any Lien on any property or
assets of a Restricted Subsidiary granted in favor of the Company or any
Restricted Subsidiary; (iii) any Lien securing the Notes or any Note Guarantee;
(iv) any Lien securing Acquired Indebtedness Incurred pursuant to Section
4.08(b)(vi), which Lien (x) is created prior to (and not in connection with or
in contemplation of) the Incurrence of such Acquired Indebtedness by the Company
or any Restricted Subsidiary, and (y) does not extend to any property or assets
of the Company or any Restricted Subsidiary other than the assets acquired in
connection with the Incurrence of such Acquired Indebtedness; (v) any Lien
securing any Indebtedness Incurred pursuant to Section 4.08(b)(xi), provided,
however, that such Lien may not extend to any other property owned by the
Company or any Restricted Subsidiary at the time such Lien is Incurred; (vi) any
Lien in favor of the Trustee under this Indenture; and (vii) any extension,
renewal or replacement in whole or in part, of any Lien described in
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the foregoing clauses (i) through (vi), provided that any such extension,
renewal or replacement shall be no more restrictive in any material respect than
the Lien so extended, renewed or replaced and shall not extend to any additional
property or assets.
"Person" means any individual, corporation, partnership, limited
liability company, joint venture, association, joint-stock company, trust,
unincorporated organization, government or any agency or political subdivision
thereof, or any other entity.
"Predecessor Note" means, with respect to any particular Note, every
previous Note evidencing all or a portion of the same debt as that evidenced by
such particular Note; and, for the purposes of this definition, any Note
authenticated and delivered under Section 2.07 hereof in exchange for a
mutilated Note or in lieu of a lost, destroyed or stolen Note shall be deemed to
evidence the same debt as the mutilated, lost, destroyed or stolen Note.
"Preferred Stock", as applied to the Capital Stock of any Person,
means Capital Stock of any class or classes (however designated) that 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 shares of Capital Stock of any other class of such Person.
"Public Equity Offering" means an underwritten public offering of
newly issued shares of common stock of MT Investors, Holding or the Company
pursuant to an effective registration statement under the Securities Act, on a
primary basis (whether alone or in conjunction with any secondary public
offering).
"Public Market" means an established public trading market existing
after a Public Equity Offering has been consummated.
"Purchase Money Obligation" means any Indebtedness secured by a Lien
on real or personal property related to the business of the Company or any
Restricted Subsidiary that is purchased by the Company or any Restricted
Subsidiary after the Issue Date; provided that (i) any security agreement or
conditional sales or other title retention contract pursuant to which the Lien
on such property is created shall be entered into within 180 days after the
purchase of such property and shall at all times
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be confined solely to such property, (ii) at no time shall the aggregate
principal amount of the Indebtedness secured by such property be increased and
(iii)(A) the Indebtedness secured thereby shall not exceed the purchase price of
such property or (B) the Indebtedness secured thereby shall be with recourse
solely to such property.
"Redeemable Capital Stock" means any class or series of Capital
Stock that, either by its terms, by the terms of any security into which it is
convertible or exchangeable or by contract or otherwise, is, or upon the
happening of an event or passage of time would be, required to be redeemed, or
matures, on or prior to the 91st day after any Stated Maturity of the Notes, or
is redeemable at the option of the holder thereof at any time on or prior to the
91st day after any Stated Maturity of the Notes, or, at the option of the holder
thereof, is convertible into or exchangeable for Indebtedness or Redeemable
Capital Stock at any time on or prior to the 91st day after any Stated Maturity
of the Notes.
"Redemption Date" means, with respect to any Note to be redeemed,
the date fixed by the Company for such redemption pursuant to this Indenture and
the Notes.
"Redemption Price" means, with respect to any Note to be redeemed,
the price fixed for such redemption pursuant to the terms of this Indenture and
the Notes.
"Refinancing Costs" means, with respect to any refinancing of term
loan borrowings under the Credit Agreement, an amount equal to (x) the lesser of
(I) the stated amount of any premium or other payment required to be paid in
connection with such refinancing pursuant to the Credit Agreement and (II) the
amount of premium or other payment actually paid by the Company, Swiss
Subholding or any Restricted Subsidiary at such time to refinance such
borrowings, plus (y) the amount of expenses of the Company, Swiss Subholding or
any Restricted Subsidiary incurred in connection with such refinancing.
"Registrar" shall have the meaning set forth in Section 2.03.
"Related Business" means the businesses of the Company and the
Restricted Subsidiaries as conducted on the Issue Date, and any businesses
related, ancillary or complementary to such businesses.
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"Related Currency and Interest Rate Protection Obligations" means
all monetary obligations of every nature of the Company or a Note Guarantor
under or in respect of any Currency Agreement or Interest Rate Agreement of the
Company or such Note Guarantor either (a) to the extent such monetary
obligations relate to Credit Agreement Obligations or (b) to the extent such
monetary obligations are secured by collateral securing Credit Agreement
Obligations.
"Restricted Payment" shall have the meaning set forth in Section
4.09.
"Restricted Subsidiary" means any Subsidiary of the Company other
than an Unrestricted Subsidiary.
"Sale/Leaseback Transaction" means an arrangement relating to
property now owned or hereafter acquired by the Company or a Restricted
Subsidiary, whereby the Company or a Restricted Subsidiary transfers such
property to a Person and the Company or a Restricted Subsidiary leases it from
such Person.
"S&P" means Standard & Poor's Rating Group (a division of McGraw
Hill Inc.) or any successor rating agency.
"SEC" means the Securities and Exchange Commission.
"Secured Indebtedness" means any Indebtedness of the Company or any
Subsidiary of the Company secured by a Lien.
"Securities Act" means the Securities Act of 1933, as amended.
"Senior Indebtedness" means the principal of, premium, if any, and
interest (including any interest accruing subsequent to the filing of a petition
of bankruptcy at the rate provided for in the documentation with respect
thereto, whether or not such interest is an allowed claim under applicable
state, federal or foreign law) on and other amounts due on or in connection with
(including any fees, premiums, expenses, including costs of collection, and
indemnities) any Indebtedness of the Company, whether outstanding on the Issue
Date or thereafter created, incurred or assumed, unless, in the case of any
particular Indebtedness, the instrument creating or evidencing the same or
pursuant to which the same is
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outstanding expressly provides that such Indebtedness shall not be senior in
right of payment to the Notes. Without limiting the generality of the foregoing,
"Senior Indebtedness" shall also include the principal of, premium, if any, and
interest (including any interest accruing subsequent to the filing of a petition
of bankruptcy at the rate provided for in the documentation with respect
thereto, whether or not such interest is an allowed claim under applicable
state, federal or foreign law) on, and all other amounts owing in respect of,
(i) all Credit Agreement Obligations of the Company and (ii) all Related
Currency and Interest Rate Protection Obligations of the Company, in each case
whether outstanding on the Issue Date or thereafter created, incurred or assumed
and including in respect of claims under guarantees, claims for indemnity,
claims in relation to Related Currency and Interest Rate Protection Obligations,
expense reimbursement and fees. Notwithstanding the foregoing, "Senior
Indebtedness" shall not include (a) Indebtedness evidenced by the Notes, (b)
Indebtedness that is pari passu with or expressly subordinated or junior in
right of payment to any Senior Indebtedness of the Company, (c) Indebtedness
which, when incurred and without respect to any election under Section 1111(b)
of Title 11, United States Code, is by its terms without recourse to the
Company, (d) any repurchase, redemption or other obligation in respect of
Redeemable Capital Stock of the Company, (e) to the extent it might constitute
Indebtedness, amounts owing for goods, materials or services purchased in the
ordinary course of business or consisting of trade payables or other current
liabilities (other than any current liabilities owing under the Credit Agreement
Obligations or the current portion of any long-term Indebtedness which would
constitute Senior Indebtedness but for the operation of this clause (e)), (f) to
the extent it might constitute Indebtedness, amounts owed by the Company for
compensation to employees or for services rendered to the Company, (g) to the
extent it might constitute Indebtedness, any liability for federal, state,
local, foreign or other taxes owed or owing by the Company, (h) Indebtedness of
the Company to a Subsidiary of the Company and (i) that portion of any
Indebtedness of the Company which at the time of Incurrence is Incurred in
violation of this Indenture; provided, however, that such Indebtedness shall be
deemed not to have been Incurred in violation of this Indenture for purposes of
this clause (i) if (x) the holder(s) of such Indebtedness or their
representative or the Company shall have furnished to the Trustee an opinion of
recognized independent legal counsel, unqualified in all material respects,
addressed to the Trustee (which legal counsel may, as to matters of fact,
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rely upon an Officers' Certificate of the Company) to the effect that the
Incurrence of such Indebtedness does not violate the provisions of this
Indenture or (y) such Indebtedness consists of Credit Agreement Obligations, and
the holder(s) of such Indebtedness or their agent or representative (1) had no
actual knowledge at the time of Incurrence that the Incurrence of such
Indebtedness violated this Indenture and (2) shall have received a certificate
from an Officer of the Company to the effect that the Incurrence of such
Indebtedness does not violate the provisions of this Indenture.
"Senior Representative" means the Bank Agent or any other
representatives designated in writing to the Trustee of the holders of any class
or issue of Designated Senior Indebtedness; provided that, in the absence of a
representative of the type described above, any holder or holders of a majority
of the principal amount outstanding of any class or issue of Designated Senior
Indebtedness may collectively act as Senior Representative for such class or
issue.
"Senior Subordinated Indebtedness" means the Notes and any other
Indebtedness of the Company that specifically provides that such Indebtedness is
to rank pari passu with the Notes and is not subordinated by its terms to any
Indebtedness or other obligation of the Company that is not Senior Indebtedness.
"Senior Subordinated Note Obligations" means (i) any principal of,
premium, if any, and interest on, and any other amounts owing in respect of, the
Notes payable pursuant to the terms of the Notes or this Indenture or upon
acceleration of the Notes, including, without limitation, amounts received upon
the exercise of rights of rescission or other rights of action (including claims
for damages) or otherwise, to the extent relating to the purchase price of the
Notes or amounts corresponding to such principal of, premium, if any, interest,
or other amounts owing with respect to, the Notes and (ii) in the case of any
Note Guarantor, any obligations with respect to the foregoing or otherwise under
its Note Guarantee.
"SFr" means Swiss francs, the lawful money of Switzerland.
"Significant Note Guarantor" means (x) Holding or (y) any other Note
Guarantor that would be a "significant subsidiary" of the Company as defined in
Rule 1-02 of
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Regulation S-X under the Securities Act and the Exchange Act, as such Rule is in
effect on the Issue Date, provided that for purposes of this definition, all
references in such Rule 1-02 to "10 percent" shall be deemed to be "5 percent".
"Significant Restricted Subsidiary" means any Restricted Subsidiary
of the Company that would be a "significant subsidiary" of the Company as
defined in Rule 1-02 of Regulation S-X under the Securities Act and the Exchange
Act, as such Rule is in effect on the Issue Date.
"Specified Indebtedness" means (i) any Indebtedness of the Company
or any Note Guarantor that is Pari Passu Indebtedness or Subordinated
Indebtedness or (ii) any Indebtedness of any Restricted Subsidiary that is
Subordinated Indebtedness, provided, however, that Specified Indebtedness shall
never include any Credit Agreement Obligation otherwise constituting Guarantor
Senior Indebtedness or Senior Indebtedness.
"Specified Senior Indebtedness" means any Senior Indebtedness,
Guarantor Senior Indebtedness, or Indebtedness of any Restricted Subsidiary
(other than a Note Guarantor) that is not Subordinated Indebtedness.
"Specified U.S. Subsidiary Indebtedness" means Indebtedness of any
U.S. Restricted Subsidiary (a) owing to and held by the Company or any U.S.
Restricted Subsidiary Incurred pursuant to Section 4.08(b)(iv), (b) Incurred
pursuant to clause (vi), (viii), (ix), (x), (xiv), (xv)(1), (xv)(2), (xvi)(A) or
(xvi)(B) of Section 4.08(b) or (c) Incurred pursuant to Section 4.08(b)(xviii)
to refinance Indebtedness previously Incurred pursuant to Section 4.08(b)(vi).
"Stated Maturity" means, when used with respect to any security, the
date specified in such security as the fixed date on which the payment of
principal of such security is due and payable, including pursuant to any
mandatory redemption provision (but excluding any provision providing for the
purchase of such security at the option of the holder thereof upon the happening
of any contingency beyond the control of the issuer unless such contingency has
occurred).
"Subordinated Indebtedness" means (i) any Indebtedness of the
Company or any Note Guarantor (whether outstanding on the Issue Date or
thereafter Incurred) that is subordinated or junior in right of payment to the
Notes
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or any Note Guarantee or (ii) Indebtedness of any Restricted Subsidiary (other
than a Note Guarantor) that is subordinated or junior in right of payment to any
other Indebtedness of such Restricted Subsidiary.
"Subsidiary" of any Person means any corporation, association,
partnership, limited liability company or other business entity of which more
than 50% of the total voting power of shares of Capital Stock (including
partnership or other equity interests) generally entitled (without the
incurrence of any contingency) to vote in the election of directors, managers or
trustees thereof is at the time owned or controlled, directly or indirectly, by
(i) such Person or (ii) one or more Subsidiaries of such Person.
"Surviving Entity" has the meaning set forth in Section 5.01.
"Swiss Subholding" means Mettler-Toledo Holding AG, a Swiss
corporation.
"Tax Sharing Agreement" means the Tax Sharing Agreement, dated the
date hereof, between the Company and MT Investors, as in effect on the Issue
Date and as the same may be amended from time to time in any manner not adverse
to the Holders.
"TIA" means the Trust Indenture Act of 1939 as in effect on the date
of this Indenture, provided, however, that in the event the Trust Indenture Act
of 1939 is amended after such date, "TIA" means to the extent required by such
amendment, the Trust Indenture Act of 1939 as so amended.
"Trust Officer" means the Chairman of the Board, the President or
any other officer or assistant officer of the Trustee assigned by the Trustee to
administer its corporate trust matters.
"Trustee" means the party named as such in this Indenture until a
successor replaces it and, thereafter, means the successor.
"Unrestricted Subsidiary" means (i) any Subsidiary of the Company
that at the time of determination shall be an Unrestricted Subsidiary (as
designated by the Board of Directors as provided below) and (ii) any Subsidiary
of an Unrestricted Subsidiary. The Board of Directors may designate (a
"Designation") any Subsidiary of the Company (other than a Subsidiary that is a
Note Guarantor or owns
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any Capital Stock of, or owns, or holds any Lien on, any property of the Company
or any other Subsidiary of the Company that is not a Subsidiary of the
Subsidiary to be so designated) to be an Unrestricted Subsidiary if: (a) no
Default shall have occurred and be continuing at the time of or after giving
effect to such Designation; (b) the Company could make an Investment at the time
of such Designation (assuming the effectiveness thereof) in an amount (the
"Designation Amount") equal to the Fair Market Value of the Capital Stock of
such Subsidiary on such date; and (c) the Company could incur $1.00 of
additional Indebtedness under Section 4.08(a) at the time of such Designation
(assuming the effectiveness thereof). In the event of any such Designation, the
Company shall be deemed to have made an Investment constituting a Restricted
Payment pursuant to Section 4.09 for all purposes of this Indenture in the
Designation Amount. The Board of Directors may revoke (a "Revocation") any
Designation of a Subsidiary as an Unrestricted Subsidiary if: (a) no Default
shall have occurred and be continuing at the time of and after giving effect to
such Revocation; (b) the Company could Incur $1.00 of additional Indebtedness
under Section 4.08(a) at the time of such Revocation (assuming the effectiveness
thereof); and (c) all Liens and Indebtedness of such Unrestricted Subsidiary
outstanding immediately following such Revocation would, if Incurred at such
time, have been permitted to be Incurred under this Indenture. Any Designation
or Revocation must be evidenced by a Board Resolution certifying compliance with
the foregoing provisions.
The Company shall not, and shall not permit any Restricted
Subsidiary to, at any time (i) provide a Guarantee of any Indebtedness of any
Unrestricted Subsidiary, (ii) be directly or indirectly liable for any
Indebtedness of any Unrestricted Subsidiary or (iii) be directly or indirectly
liable for any Indebtedness which provides that the holder thereof may (upon
notice, lapse of time or both) declare a default thereon or cause the payment
thereof to be accelerated or payable prior to its final scheduled maturity upon
the occurrence of a default with respect to any Indebtedness of any Unrestricted
Subsidiary (including any right to take enforcement action against such
Unrestricted Subsidiary), except in the case of clause (i) or (ii) to the extent
permitted under Section 4.09. No Unrestricted Subsidiary shall at any time
Guarantee any obligation of the Company or any Restricted Subsidiary.
"U.S. Government Obligations" means direct obligations (or
certificates representing an ownership
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interest in such obligations) of the United States of America (including any
agency or instrumentality thereof) for the payment of which the full faith and
credit of the United States of America is pledged and which are not callable or
redeemable at the issuer's option.
"U.S. Restricted Subsidiary" means any Restricted Subsidiary of the
Company (a) organized under the laws of the United States of America, any state
thereof or the District of Columbia or (b) a majority of the assets (excluding
equity investments in other Persons) of which are located in the United States
of America based on the Fair Market Value of such assets (as determined in good
faith by the Board of Directors).
"U.S. Significant Subsidiary" means any U.S. Restricted Subsidiary
(other than any Note Guarantor) that individually is, or taken together with
other U.S. Restricted Subsidiaries (other than any Note Guarantor) would be, a
Significant Restricted Subsidiary.
"Voting Stock" means any class or classes of Capital Stock pursuant
to which the holders thereof have the general voting power under ordinary
circumstances to elect at least a majority of the board of directors, managers,
or trustees of any Person (irrespective of whether or not, at the time, stock of
any other class or classes shall have, or might have, voting power by reason of
the happening of any contingency).
"Wholly Owned Non-U.S. Subsidiary" means a Non-U.S. Restricted
Subsidiary of the Company all the Capital Stock of which (other than nominal
directors' qualifying shares) is owned by the Company or another Wholly Owned
Non-U.S. Subsidiary.
"Wholly Owned Subsidiary" means a Restricted Subsidiary of the
Company all the Capital Stock of which (other than nominal directors' qualifying
shares) is owned by the Company or another Wholly Owned Subsidiary.
Section 1.02. Incorporation by Reference of Trust Indenture Act.
Whenever this Indenture refers to a provision of the TIA, the provision is
incorporated by ref erence in and made a part of this Indenture. The following
TIA terms used in this Indenture have the following meanings:
"Commission" means the SEC;
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"indenture notes" means the Notes and the Note Guarantees;
"indenture noteholder" means a Noteholder or Holder;
"indenture to be qualified" means this Indenture;
"indenture trustee" or "institutional trustee" means the Trustee;
and
"obligor" on the indenture notes means the Company, Holding or any
other obligor on the Notes.
All other TIA terms used in this Indenture that are defined by the
TIA, defined by TIA reference to another statute or defined by SEC rule and not
otherwise defined herein have the meanings assigned to them therein.
Section 1.03. Rules of Construction. For all purposes of this
Indenture, except as otherwise expressly provided or unless the context
otherwise requires:
(a) a term has the meaning assigned to it;
(b) words in the singular include the plural, and words in the
plural include the singular;
(c) "or" is not exclusive;
(d) provisions apply to successive events and transactions;
(e) all accounting terms not otherwise defined herein have the
meanings assigned to them in accordance with generally accepted accounting
principles, as in effect from time to time unless reference to GAAP is
made with respect to any specific accounting term; and
(f) the words "herein", "hereof" and "hereunder" and other words of
similar import refer to this Indenture as a whole and not to any
particular Article, Section or other subdivision.
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ARTICLE TWO
THE NOTES
Section 2.01. Forms and Dating. The Notes and the Trustee's
certificate of authentication thereon shall be in substantially the form of
Exhibit A hereto, with such appropriate insertions, omissions, substitutions and
other variations as are required or permitted by this Indenture and may have
such letters, numbers or other marks of identification and such legends or
endorsements placed thereon as may be required to comply with any applicable law
or with the rules of any securities exchange or as may, consistently herewith,
be determined by the Officers executing such Notes, as evidenced by their
execution thereof. The Notes shall be issuable only in registered form without
coupons and only in denominations of $1,000 and integral multiples thereof.
The definitive Notes and Note Guarantees shall be printed,
typewritten, lithographed or engraved or produced by any combination of these
methods or may be produced in any other manner permitted by the rules of any
securities exchange on which the Notes may be listed, all as determined by the
Officers executing such Notes, as evidenced by their execution of such Notes.
Each Note shall be dated the date of its authentication.
The terms and provisions contained in the form of the Notes, annexed
hereto as Exhibit A shall constitute, and are hereby expressly made, a part of
this Indenture and, to the extent applicable, the Company and the Trustee, by
their execution and delivery of this Indenture, expressly agree to such terms
and provisions and to be bound thereby.
(a) Global Note. The Notes shall be issued initially in the form of
one Global Note (the "Global Note") in definitive, fully registered form without
interest coupons in substantially the form of Exhibit A, which shall be
deposited on behalf of the purchasers of the Notes represented thereby with the
Trustee, at its New York City office, as custodian for the Depository, and
registered in the name of the Depository or a nominee of the Depository, duly
executed by the Company and authenticated by the Trustee as hereinafter
provided. The aggregate principal amount of the Global Note may from time to
time be increased or decreased by adjustments made on the records of the Trustee
and the Depository or its nominee in the limited circumstances hereinafter
provided.
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(b) Certificated Notes. Except as provided in Section 2.06, owners
of beneficial interests in the Global Note will not be entitled to receive
physical delivery of certificated securities.
Section 2.02. Execution and Authentication. Two Officers of the
Company shall execute the Notes on behalf of the Company by either manual or
facsimile signature. The Company's seal shall be impressed, affixed, imprinted
or reproduced on the Notes.
If an Officer of the Company whose signature is on a Note no longer
holds that office at the time the Trustee authenticates the Note or at any time
thereafter, the Note shall be valid nevertheless.
A Note shall not be valid until an authorized signatory of the
Trustee manually signs the certificate of authentication on the Note. Such
signature shall be conclusive evidence that the Note has been authenticated
under this Indenture.
The Trustee shall authenticate Notes for original issue in an
aggregate principal amount not to exceed $135,000,000 upon receipt of an
Officers' Certificate of the Company directing the Trustee to authenticate the
Notes and certifying that all conditions precedent to the issuance of the Notes
contained herein have been complied with. The aggregate principal amount of
Notes outstanding at any time may not exceed $135,000,000, except as provided in
Sections 2.07 and 2.08.
With the approval of the Company, the Trustee may appoint an
authenticating agent acceptable to the Company to authenticate Notes. Unless
limited by the terms of such appointment, an authenticating agent may
authenticate Notes whenever the Trustee may do so. Each reference in this
Indenture to authentication by the Trustee includes authentication by such
agent. Such authenticating agent shall have the same rights as the Trustee in
any dealings here under with the Company or with any of the Company's Affil-
iates.
Section 2.03. Registrar and Paying Agent. The Company shall maintain
in New York City an office or agency where Notes may be presented for
registration of transfer or for exchange (the "Registrar"), an office or agency
where Notes may be presented for payment (the "Paying Agent") and an office or
agency where notices and demands to or upon the
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Company in respect of the Notes and this Indenture may be served. The Registrar
shall keep a register of the Notes and of their transfer and exchange. The
Company may have one or more co-Registrars and one or more additional paying
agents. The term "Paying Agent" includes any additional paying agent. Except as
otherwise expressly provided in this Indenture, the Company or any Affiliate
thereof may act as Paying Agent.
The Company shall enter into an appropriate agency agreement with
any Agent not a party to this Indenture, which shall incorporate the provisions
of the TIA. The agreement shall implement the provisions of this Indenture that
relate to such Agent. The Company shall notify the Trustee of the name and
address of any such Agent. If the Company fails to maintain a Registrar, Paying
Agent or agent for service of notices and demands, or fails to give the
foregoing notice, the Trustee shall act as such and shall be entitled to
appropriate compensation in accordance with Section 7.08.
The Company hereby initially appoints the Trustee as Registrar,
Paying Agent and agent for service of notices and demands in connection with the
Notes.
Section 2.04. Paying Agent to Hold Money in Trust. Each Paying Agent
shall hold in trust for the benefit of the Holders or the Trustee all money
held by the Paying Agent for the payment of principal of, premium, if any, or
interest on the Notes (whether such money has been distributed to it by the
Company or any other obligor on the Notes), and the Company and the Paying Agent
shall notify the Trustee of any default by the Company (or any other obligor on
the Notes) in making any such payment. If the Company or a Subsidiary acts as
Paying Agent, it shall segregate the money and hold it as a separate trust fund.
The Company at any time may require a Paying Agent to distribute all money held
by it to the Trustee and account for any funds disbursed and the Trustee may at
any time during the continuance of any payment default with respect to the
Notes, upon written request to a Paying Agent, require such Paying Agent to pay
all money held by it to the Trustee and to account for any funds distributed.
Upon doing so, the Paying Agent (other than an obligor under the Notes or any
Note Guarantee) shall have no further liability for the money so paid over to
the Trustee.
Section 2.05. Noteholder Lists. The Trustee shall preserve in as
current a form as is reasonably prac-
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ticable the most recent list available to it of the names and addresses of the
Holders and shall otherwise comply with TIA Section 312(a). If the Trustee is
not the Registrar, the Company shall furnish to the Trustee at least ten
Business Days before each Interest Payment Date and at such other times as the
Trustee may request in writing a list in such form and as of such date as the
Trustee may reasonably require of the names and addresses of Holders, which list
may be conclusively relied upon by the Trustee.
Section 2.06. Transfer and Exchange. When Notes are presented to the
Registrar or a co-Registrar with a request to register the transfer of such
Notes or to exchange such Notes for an equal principal amount of Notes of other
authorized denominations, the Registrar shall register the transfer or make the
exchange as requested if its requirements for such transfer or exchange are met;
provided that the Notes surrendered for transfer or exchange shall be duly
endorsed or accompanied by a written instrument of transfer in form satisfactory
to the Registrar, duly executed by the Holder thereof or his attorney duly
authorized in writing. To permit registrations of transfers and exchanges, the
Company shall execute and the Trustee shall authenticate Notes at the
Registrar's request. No service charge shall be made for any registration of
transfer or exchange, but the Company may require payment of a sum sufficient to
cover any transfer tax or similar governmental charge payable in connection
therewith (other than any such transfer taxes or similar governmental charge
payable upon exchanges or transfers pursuant to Sections 2.02, 2.07, 2.10, 3.06,
4.18, 4.19 or 9.05). The Registrar shall not be required to register the
transfer of or exchange of any Note (i) during a period beginning at the opening
of business 15 days before the mailing of a notice of redemption of Notes and
ending at the close of business on the day of such mailing and (ii) selected for
redemption in whole or in part pursuant to Article Three, except the unredeemed
portion of any Note being redeemed in part.
With respect to the Global Note:
(1) The Global Note authenticated under this Indenture shall be
registered in the name of the Depository designated for the Global Note or
a nominee thereof and deposited with such Depository or a nominee thereof
or custodian therefor, and such Global Note shall constitute a single Note
for all purposes of this Indenture.
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(2) A Global Note may not be transferred except as a whole by the
Depository to a nominee of the Depository. A Global Note is exchangeable
for certificated Notes only if (i) the Depository notifies the Company
that it is unwilling or unable to continue as a Depository for such Global
Note or if at any time the Depository ceases to be a clearing agency
registered under the Exchange Act, (ii) the Company executes and delivers
to the Trustee a notice that such Global Note shall be so transferable,
registrable, and exchangeable, and such transfers shall be registrable or
(iii) there shall have occurred and be continuing an Event of Default or
an event which, with the giving of notice or lapse of time or both, would
constitute an Event of Default with respect to the Notes represented by
such Global Note. Any Global Note that is exchangeable for certificated
Notes pursuant to the preceding sentence will be transferred to, and
registered and exchanged for, certificated Notes in authorized
denominations, without legends applicable to a Global Note, and registered
in such names as the Depository holding such Global Note may direct.
Subject to the foregoing, a Global Note is not exchangeable, except for a
Global Note of like denomination to be registered in the name of the
Depository or its nominee. In the event that a Global Note becomes
exchangeable for certificated securities, (x) certificated Notes will be
issued only in fully registered form in denominations of $1,000 or
integral multiples thereof, (y) payment of principal, any repurchase
price, and interest on the certificated Notes will be payable, and the
transfer of the certificated Notes will be registrable, at the office or
agency of the Company maintained for such purposes, and (z) no service
charge will be made for any registration or transfer or exchange of the
certificated Notes, although the Company may require payment of a sum
sufficient to cover any tax or governmental charge imposed in connection
therewith.
(3) Notes issued in exchange for a Global Note or any portion
thereof shall have an aggregate principal amount equal to that of such
Global Note or portion thereof to be so exchanged, shall be registered in
such names and be in such authorized denominations as the Depository shall
designate and shall bear the applicable legends provided for herein. Any
Global Note to be exchanged in whole shall be surrendered by the
Depository to the Trustee. With respect to any
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Global Note to be exchanged in part, either such Global Note shall be so
surrendered for exchange or, if the Trustee is acting as custodian for the
Depository or its nominee with respect to such Global Note, the principal
amount thereof shall be reduced, by an amount equal to the portion thereof
to be so exchanged, by means of an appropriate adjustment made on the
records of the Trustee. Upon any such surrender or adjustment, the Trustee
shall authenticate and deliver the Note issuable on such exchange to or
upon the order of the Depository or an authorized representative thereof.
(4) Every security authenticated and delivered upon registration of
transfer of, or in exchange for or in lieu of, a Global Note or any
portion mutilated thereof, whether pursuant to this Section, Section 2.07
or 2.10 or otherwise, shall be authenticated and delivered in the form of,
and shall be, a Global Note, unless such Note is registered in the name of
a Person other than the Depository for such Global Note or a nominee
thereof.
Members of, or participants in, the Depository ("Participants")
shall have no rights under this Indenture with respect to the Global Note held
on their behalf by the Depository or by the Trustee as the custodian of the
Depository or under such Global Note, and the Depository or a nominee thereof,
as the case may be, may be treated by the Company, the Trustee and any agent of
the Company or the Trustee as the absolute owner of such Global Note for all
purposes whatsoever. Notwithstanding the foregoing, nothing herein shall prevent
the Company, the Trustee or any agent of the Company or the Trustee from giving
effect to any written certification, proxy or other authorization furnished by
the Depository or impair, as between the Depository and its Participants, the
operation of customary practices of such Depository governing the exercise of
the rights of a holder of a beneficial interest in the Global Note.
Section 2.07. Replacement Notes. If a mutilated Note is surrendered
to the Trustee or if the Holder of a Note claims that the Note has been lost,
destroyed or wrongfully taken, the Company shall issue and the Trustee shall
authenticate a replacement Note if the Trustee's requirements are met. If
required by the Trustee or the Company, such Holder must provide an indemnity
bond or other indemnity, sufficient in the judgment of both the Company and the
Trustee, to protect the Company, the Trustee or any Agent
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from any loss which any of them may suffer if a Note is replaced. The Company
and the Trustee may charge such Holder for its reasonable, out-of-pocket
expenses in replacing a Note, including reasonable fees and expenses of counsel.
Every replacement Note is an additional obligation of the Company.
Section 2.08. Outstanding Notes. Notes outstanding at any time are
all the Notes that have been authenticated by the Trustee except those cancelled
by it, those delivered to it for cancellation, those described in this Section
2.08 as not outstanding and those deemed satisfied pursuant to Article Eight. A
Note does not cease to be outstanding because the Company or any of its
Affiliates holds the Note.
If a Note is replaced pursuant to Section 2.07 (other than a
mutilated Note surrendered for replacement), it ceases to be outstanding unless
the Trustee receives proof satisfactory to it that the replaced Note is held by
a bona fide purchaser. A mutilated Note ceases to be outstanding upon surrender
of such Note and replacement thereof pursuant to Section 2.07.
If on a Redemption Date or a Maturity Date the Paying Agent (other
than the Company or an Affiliate of the Company) holds cash or U.S. Government
Obligations sufficient to pay all of the principal, premium, if any, and
interest due on the Notes payable on that date, and is not prohibited from
paying such cash or U.S. Government Obligations to the Holders of such Notes
pursuant to the terms of this Indenture, then on and after that date such Notes
cease to be outstanding and interest on them shall cease to accrue.
Section 2.09. Treasury Notes. In determining whether the Holders of
the required principal amount of Notes have concurred in any direction, waiver
or consent, Notes owned by the Company or any of its Affiliates shall be
disregarded, except that, for the purposes of determining whether the Trustee
shall be protected in relying on any such direction, waiver or consent, only
Notes which the Trustee knows or has reason to know are so owned shall be
disregarded.
Section 2.10. Temporary Notes. Until definitive Notes are prepared
and ready for delivery, the Company may prepare and the Trustee shall
authenticate temporary Notes. Temporary Notes shall be substantially in the form
of defin-
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itive Notes but may have variations that the Company considers appropriate for
temporary Notes. Without unreasonable delay, the Company shall prepare and the
Trustee shall authenticate definitive Notes in exchange for temporary Notes.
Until such exchange, temporary Notes shall be entitled to the same rights,
benefits and privileges as definitive Notes.
Section 2.11. Cancellation. The Company at any time may deliver
Notes to the Trustee for cancellation. The Registrar and the Paying Agent shall
forward to the Trustee any Notes surrendered to them for transfer, exchange or
payment. The Trustee, or at the direction of the Trustee, the Registrar or the
Paying Agent (other than the Company or a Subsidiary of the Company), and no one
else, shall cancel and, at the written direction of the Company, shall dispose
of all Notes surrendered for transfer, exchange, payment or cancellation.
Subject to Section 2.07, the Company may not issue new Notes to replace Notes
that it has paid or delivered to the Trustee for cancellation. If the Company
shall acquire any of the Notes, such acquisition shall not operate as a
redemption or satisfaction of the Indebtedness represented by such Notes unless
and until the same are surrendered to the Trustee for cancellation pursuant to
this Section 2.11.
Section 2.12. Defaulted Interest. If the Company defaults on a
payment of interest on the Notes, it shall pay the defaulted interest, plus (to
the extent permitted by law) any interest payable on the defaulted interest, in
accordance with the terms hereof, to the Persons who are Noteholders on a
subsequent special record date, which date shall be at least ten Business Days
prior to the payment date. The Company shall fix such special record date and
payment date in a manner satisfactory to the Trustee. At least 15 days before
such special record date, the Company shall mail to each Noteholder a notice
that states the special record date, the payment date and the amount of
defaulted interest, and interest payable on such defaulted interest, if any, to
be paid.
The Company may make payment of any defaulted interest in any other
lawful manner not inconsistent with the requirements (if applicable) of any
securities exchange on which the Notes may be listed, and upon such notice as
may be required by such exchange, if, after notice given by the Company to the
Trustee of the proposed payment pursuant to this paragraph, such manner of
payment shall be deemed practicable by the Trustee.
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Section 2.13. CUSIP Number. The Company in issuing the Notes may use
a "CUSIP" number (if then generally in use), and if so, the Trustee may use the
CUSIP numbers in notices of redemption or exchange as a convenience to Holders;
provided that any such notice may state that no representation is made as to the
correctness or accuracy of the CUSIP number printed in the notice or on the
Notes, and that reliance may be placed only on the other identification numbers
printed on the Notes. The Company will promptly notify the Trustee of any change
in the CUSIP number.
Section 2.14. Deposit of Moneys. On or before each Interest Payment
Date and Maturity Date, the Company shall deposit with the Trustee or Paying
Agent in immediately available funds money sufficient to make cash payments,
if any, due on such Interest Payment Date or Maturity Date, as the case may be,
in a timely manner which permits the Paying Agent to remit payment to the
Holders on such Interest Payment Date or Maturity Date, as the case may be;
provided that the Company may make any such deposit in next day funds on or
before the Business Day before each Interest Payment Date and Maturity Date.
Section 2.15. Computation of Interest. Interest payable on the Notes
shall be computed on the basis of a 360-day year comprised of twelve 30-day
months.
ARTICLE THREE
REDEMPTION OF NOTES
Section 3.01. Notices to the Trustee. If the Company elects to
redeem Notes pursuant to Paragraphs 4(a) or (b) of the Notes, it shall notify
the Trustee of the Redemption Date and principal amount of Notes to be redeemed.
The Company shall notify the Trustee by an Officers' Certificate,
stating that such redemption will comply with the provisions hereof and of the
Notes, of any redemption at least 45 days before the Redemption Date (unless a
shorter notice period shall be satisfactory to the Trustee).
Section 3.02. Selection of Notes to Be Redeemed. In the event that
less than all of the Notes are to be redeemed at any time, selection of such
Notes for redemption will be made by the Trustee in compliance with the
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requirements of the principal national securities exchange, if any, on which the
Notes are listed or, if the Notes are not then listed on a national securities
exchange (or if the Notes are so listed but the exchange does not impose
requirements with respect to the selection of debt securities for redemption),
on a pro rata basis, by lot or by such other method as the Trustee shall deem
fair and appropriate; provided that no Notes of a principal amount of $1,000 or
less shall be redeemed in part.
The Trustee shall promptly notify the Company and the Registrar in
writing of the Notes selected for redemption and, in the case of any Notes
selected for partial redemption, the principal amount thereof to be redeemed.
For all purposes of this Indenture, unless the context otherwise
requires, all provisions relating to redemption of Notes shall relate, in the
case of any Note redeemed or to be redeemed only in part, to the portion of the
principal amount of such Note which has been or is to be redeemed.
Section 3.03. Notice of Redemption. Notice of redemption shall be
given by first-class mail, postage prepaid, mailed not less than 30 nor more
than 60 days prior to the Redemption Date to each Holder of Notes to be
redeemed, at the address of such Holder appearing in the Note register
maintained by the Registrar.
All notices of redemption shall identify the Notes to be redeemed
and shall state:
(a) the Redemption Date;
(b) the Redemption Price and the amount of accrued interest, if any,
to be paid;
(c) that, unless the Company defaults in making the redemption
payment, interest on Notes called for redemption ceases to accrue on and
after the Redemption Date, and the only remaining right of the Holders of
such Notes is to receive payment of the Redemption Price upon surrender to
the Paying Agent of the Notes redeemed;
(d) if any Note is to be redeemed in part only, the portion of the
principal amount (equal to $1,000 or any integral multiple thereof) of
such Note to be redeemed and that on and after the Redemption Date,
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upon surrender for cancellation of such Note to the Paying Agent, a new
Note or Notes in the aggregate principal amount equal to the unredeemed
portion thereof will be issued without charge to the Noteholder;
(e) that Notes called for redemption must be surrendered to the
Paying Agent to collect the Redemption Price and the name and address of
the Paying Agent;
(f) the CUSIP number, if any, relating to such Notes;
(g) the paragraph of the Notes pursuant to which the Notes are being
redeemed; and
(h) no representation is made as to the accuracy or correctness of
the CUSIP number, if any, listed in such notice or printed on the Notes.
Notice of redemption of Notes to be redeemed at the election of the
Company shall be given by the Company or, at the Company's written request, by
the Trustee in the name and at the expense of the Company.
The notice, if mailed in the manner provided herein, shall be
conclusively presumed to have been given, whether or not the Holder receives
such notice. In any case, failure to give such notice by mail or any defect in
the notice shall not affect the validity of the proceedings for the redemption
of any Note.
Section 3.04. Effect of Notice of Redemption. Once notice of
redemption is mailed, Notes called for redemption become due and payable on the
Redemption Date and at the applicable Redemption Price (expressed as percentages
of principal amount). Upon surrender to the Paying Agent, such Notes called for
redemption shall be paid at the Redemption Price, plus accrued interest, if any,
to the Redemption Date, but interest installments whose maturity is on or prior
to such Redemption Date will be payable on the relevant Interest Payment Dates
to the Holders of record at the close of business on the relevant record dates
referred to in the Notes.
Section 3.05. Deposit of Redemption Price. On or prior to any
Redemption Date, the Company shall deposit with the Paying Agent an amount of
money in same day funds suf-
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ficient to pay the Redemption Price of, and accrued interest on, all the Notes
or portions thereof which are to be redeemed on that date, other than Notes or
portions thereof called for redemption on that date which have been delivered by
the Company to the Trustee for cancellation.
If the Company complies with the preceding paragraph, then, unless
the Company defaults in the payment of such Redemption Price, interest on the
Notes to be redeemed will cease to accrue on and after the applicable Redemption
Date, whether or not such Notes are presented for payment. If any Note called
for redemption shall not be so paid upon surrender thereof for redemption, the
principal of and, to the extent lawful, accrued interest thereon shall, until
paid, bear interest from the Redemption Date at the rate provided in the Notes.
Section 3.06. Notes Redeemed or Purchased in Part. Upon surrender to
the Paying Agent of a Note which is to be redeemed in part, the Company shall
execute, each Note Guarantor shall Guarantee and the Trustee shall authenticate
and deliver to the Holder of such Note without service charge, a new Note or
Notes (accompanied by a notation of Note Guarantee, duly endorsed by each such
Note Guarantor), of any authorized denomination as requested by such Holder in
aggregate principal amount equal to, and in exchange for, the unredeemed portion
of the principal of the Note so surrendered that is not redeemed.
ARTICLE FOUR
COVENANTS
Section 4.01. Payment of Notes. The Company shall pay, or cause to
be paid, the principal of, premium, if any, and interest on the Notes on the
dates and in the manner provided in the Notes and this Indenture. An installment
of principal or interest shall be considered paid on the date due if the Trustee
or Paying Agent (other than the Company, a Subsidiary of the Company or any
Affiliate of any thereof) holds on that date money designated for and sufficient
to pay the installment and is not prohibited from paying such money to the
Holders of the Notes pursuant to the terms of this Indenture.
The Company shall pay interest on overdue principal at the rate and
in the manner provided in the Notes. The Company shall pay interest on overdue
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installments of interest at the same rate and in the same manner, to the extent
lawful.
Section 4.02. Maintenance of Office or Agency. The Company shall
maintain in the Borough of Manhattan, The City of New York, an office or agency
where (i) the Notes and the Note Guarantees may be surrendered for registration
of transfer or exchange, (ii) the Notes and the Note Guarantees may be presented
for payment and (iii) notices and demands to or upon the Company or any Note
Guarantor in respect of the Notes, the Note Guarantees and this Indenture may be
served. The Company shall give prompt written notice to the Trustee of the
location, and any change in the location, of such office or agency. If at any
time the Company shall fail to maintain any such required office or agency or
shall fail to furnish the Trustee with the address thereof, such presentations,
surrenders, notices and demands may be made or served at the address of the
Trustee as set forth in Section 12.02.
The Company may also from time to time designate one or more other
offices or agencies where the Notes and the Note Guarantees may be presented or
surrendered for any or all such purposes and may from time to time rescind such
designations; provided that no such designation or rescission shall in any
manner relieve the Company of its obligation to maintain an office or agency in
the Borough of Manhattan, The City of New York, for such purposes. The Company
shall give prompt written notice to the Trustee of any such designation or
rescission and of any change in the location of any such other office or agency.
The Company hereby initially designates the office of the Trustee
maintained at 114 West 47th Street, New York, New York 10036, as such office of
the Company in accordance with this Section 4.02.
Section 4.03. Corporate Existence. Subject to Article Five, the
Company shall do or cause to be done all things necessary to and shall cause
each of its Subsidiaries to, preserve and keep in full force and effect the
corporate, partnership or limited liability company existence and rights
(charter and statutory), licenses and/or franchises of the Company and each of
its Subsidiaries; provided that the Company or any of its Subsidiaries shall not
be required to preserve any such existence (in the case of Subsidiaries),
rights, licenses or franchises if (x) the Company shall reasonably determine
that the preservation thereof is no longer desirable in the
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conduct of the business of the Company and its Subsidiaries taken as a whole or
(y) the loss thereof is not materially adverse to the Company and its
Subsidiaries taken as a whole or to the ability of the Company to otherwise
satisfy its obligations hereunder; provided, further, however, that the
foregoing shall not prohibit the sale, transfer or conveyance of a Subsidiary or
any of its assets in compliance with the terms of this Indenture.
Section 4.04. Payment of Taxes and Other Claims. The Company shall
pay or discharge or cause to be paid or discharged, before any penalty accrues
from the failure to so pay or discharge, (a) all material taxes, assessments and
governmental charges levied or imposed upon the Company or any Subsidiary or
upon the income, profits or property of the Company or any Subsidiary, and (b)
all material lawful claims for labor, materials and supplies which, if unpaid,
might by law become a Lien upon the property of the Company or any Subsidiary
except for Permitted Liens; provided, however, that the Company shall not be
required to pay or discharge or cause to be paid or discharged any such tax,
assessment, charge or claim the amount, applicability or validity of which is
being contested in good faith by appropriate proceedings properly instituted and
diligently conducted and for which adequate provision (in the good faith
judgment of management of the Company) has been made or where the failure to
effect such payment or discharge is not adverse in any material respect to the
Holders or is not materially adverse to the Company and its Subsidiaries taken
as a whole or to the ability of the Company to otherwise satisfy its obligations
hereunder.
Section 4.05. Maintenance of Properties. The Company shall, and
shall cause each of its Subsidiaries to, cause all material properties and
assets to be maintained and kept in good condition, repair and working order
(ordinary wear and tear excepted) and supplied with all necessary equipment, and
shall cause to be made all necessary repairs, renewals, replacements, additions,
betterments and improvements thereto, as shall be reasonably necessary for the
proper conduct of its business; provided that nothing in this Section 4.05 shall
prevent the Company or any Subsidiary from discontinuing the operation and
maintenance of any of its properties (x) if such discontinuance is, in the
judgment of the Company or of such Subsidiary, desirable in the conduct of its
business or (y) if such discontinuance or disposal is not materially adverse to
the Company and its Subsidiaries taken as a whole or the
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ability of the Company to otherwise satisfy its obligations hereunder.
Section 4.06. Compliance Certificate; Notice of Default. (a) The
Company shall deliver to the Trustee within 90 days after the end of each fiscal
year an Officers' Certificate stating whether or not the signers know of any
Default or Event of Default under this Indenture that occurred during such
fiscal period. If they do know of such a Default or Event of Default, the
certificate shall describe any such Default or Event of Default and its status.
One of the persons signing the Officers' Certificate given pursuant to this
Section 4.06 shall be the principal executive, financial or accounting officer
of the Company, in compliance with TIA Section 314(a)(4).
(b) The Company shall deliver to the Trustee as soon as possible,
and in any event within 30 days after the Company becomes aware or should
reasonably have become aware of the occurrence of any Default or Event of
Default, an Officers' Certificate specifying such Default or Event of Default
and what action the Company is taking or proposes to take with respect thereto.
Section 4.07. Waiver of Stay, Extension or Usury Laws. The Company
covenants (to the extent that it may lawfully do so) that it will not at any
time insist upon, or plead, or in any manner whatsoever claim or take the
benefit or advantage of, any stay or extension law or any usury law or other law
which would prohibit or forgive the Company from paying all or any portion of
the principal of, premium, if any, or interest on the Notes as contemplated
herein, wherever enacted, now or at any time hereafter in force, or which may
affect the covenants or the performance of this Indenture; and (to the extent
that it may lawfully do so) the Company hereby expressly waives all benefit or
advantage of any such law, and covenants that it will not hinder, delay or
impede the execution of any power herein granted to the Trustee, but will suffer
and permit the execution of every such power as though no such law had been
enacted.
Section 4.08. Limitation on Indebtedness. (a) The Company shall not,
and shall not permit any Restricted Subsidiary to, Incur any Indebtedness
(including Acquired Indebtedness), unless such Incurrence is by the Company, and
on the date of such Incurrence the Consolidated Coverage Ratio would be greater
than 2.0:1.0, if such Indebtedness is Incurred on or prior to December 31, 1998
and 2.25:1.0 if such Indebtedness is Incurred thereafter.
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(b) Notwithstanding the foregoing paragraph (a), the Company and, to
the extent specifically set forth below, its Restricted Subsidiaries may Incur
the following Indebtedness:
(i) Indebtedness of the Company or Swiss Subholding under the Credit
Agreement in an aggregate principal amount at any time outstanding not to
exceed (x) an amount of term loan borrowings thereunder equal to (1) the
aggregate principal amount of term loan borrowings by the Company or Swiss
Subholding outstanding under the Credit Agreement on the Issue Date minus
(2) the aggregate amount of all scheduled repayments and mandatory
repayments of term loan borrowings thereunder, whether or not actually
made (unless any such repayment is waived or the relevant provision
requiring any such repayment is amended by the lenders thereunder in
accordance therewith), and all other repayments of term loan borrowings
actually made thereunder (other than to the extent refinanced by an equal
principal amount of Indebtedness Incurred under this clause (i)) plus (3)
if such term loan borrowings are refinanced pursuant to this clause (i),
an amount of Refinancing Costs paid in connection with such refinancing,
plus (y) $140,000,000 of revolving credit borrowings thereunder (minus the
aggregate amount of Indebtedness of Non-U.S. Restricted Subsidiaries
Incurred pursuant to clause (xvii) of this paragraph (b)), provided that
(A) the aggregate principal amount of term loan borrowings by
Swiss Subholding outstanding under the Credit Agreement at any
time outstanding shall not exceed an amount equal to (x) the
aggregate principal amount of term loan borrowings by Swiss
Subholding outstanding under the Credit Agreement on the Issue
Date plus (y) if such term loan borrowings are refinanced
pursuant to this clause (i), an amount of Refinancing Costs
paid in connection with such refinancing,
(B) any Indebtedness Incurred by Swiss Subholding to renew,
extend, substitute for, refinance or replace (each, for
purposes of this clause (i), to "refinance") any Indebtedness
under the Credit Agreement shall be Incurred only
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in a transaction exempt from registration requirements under
United States securities laws, and not pursuant to a public
offering in the United States of America, and shall not be so
registered for resale in a public offering in the United
States of America, and
(C) for purposes of determining the outstanding principal amount
of term loan Indebtedness under this clause (i), the aggregate
principal amount of term loan Indebtedness that is Incurred
(x) to refinance term loan Indebtedness under the Credit
Agreement and (y) in a different currency from the
Indebtedness being refinanced, shall be calculated based on
the relevant currency exchange rate in effect on the date of
such refinancing;
(ii) Indebtedness of the Company pursuant to the Notes, Indebtedness
of any Note Guarantor pursuant to its Note Guarantee, and Indebtedness of
any other Restricted Subsidiary with respect to the Notes arising by
reason of any Lien granted by such Subsidiary to secure the Notes;
(iii) Indebtedness of the Company or any Restricted Subsidiary
outstanding on the Issue Date and listed on Schedule 2 to this Indenture
(other than Indebtedness under or in respect of the Credit Agreement);
(iv) Indebtedness of the Company owing to and held by any Restricted
Subsidiary or Indebtedness of a Restricted Subsidiary owing to and held by
the Company or any Restricted Subsidiary; provided, however, that (x) any
such Indebtedness is made pursuant to an intercompany note, (y) any such
Indebtedness of the Company or any Note Guarantor is Subordinated
Indebtedness that is subordinated to the Notes or to the applicable Note
Guarantee as provided in such intercompany note, and in any event at least
to the same extent as the Notes are subordinated to Senior Indebtedness,
and (z) any subsequent transfer of any such Indebtedness (except to the
Company or a Restricted Subsidiary) will be deemed, in each case, to
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constitute the Incurrence of such Indebtedness by the issuer thereof;
(v) Acquisition Indebtedness of any Non-U.S. Restricted Subsidiary
Incurred after the Issue Date (and not for the purpose of financing the
Acquisition), provided that (x) at the time of such Incurrence and after
giving effect thereto on a pro forma basis, (A) no Default or Event of
Default will have occurred and be continuing or would result therefrom and
(B) the Company could Incur $1.00 of additional Indebtedness pursuant to
paragraph (a) above and (y) such Indebtedness (unless Incurred by a Note
Guarantor) shall be Incurred only in a transaction exempt from
registration requirements under United States securities laws, and not
pursuant to a public offering in the United States of America, and shall
not be so registered for resale in a public offering in the United States
of America;
(vi) Acquired Indebtedness of any Restricted Subsidiary, provided
that at the time of such Incurrence and after giving effect thereto on a
pro forma basis, (x) no Default or Event of Default will have occurred and
be continuing or would result therefrom and (y) the Company could Incur
$1.00 of additional Indebtedness pursuant to paragraph (a) above;
(vii) Indebtedness of any Restricted Subsidiary that is a Note
Guarantor, provided that at the time of such Incurrence and after giving
effect thereto on a pro forma basis, (x) no Default or Event of Default
will have occurred and be continuing or would result therefrom and (y) the
Company could Incur $1.00 of additional Indebtedness pursuant to paragraph
(a) above;
(viii) Obligations of the Company or any Restricted Subsidiary
entered into in the ordinary course of business (A) under Interest Rate
Agreements designed to protect such Person against fluctuations in
interest rates in respect of Indebtedness of such Person permitted to be
incurred under this Indenture, which obligations do not exceed the
aggregate principal amount of such Indebtedness, and (B) under Currency
Agreements designed to protect such Person against fluctuations in foreign
currency exchange rates in
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respect of foreign exchange exposures incurred by such Person;
(ix) Obligations of the Company or any Restricted Subsidiary in
respect of (A) judgment, performance, surety and other bonds provided by
such Person with respect to obligations of such Person in the ordinary
course of business, and (B)(x) letters of credit securing obligations
incurred in the ordinary course of business or (y) other letters of credit
in an amount not to exceed $5,000,000 in the aggregate outstanding at any
time;
(x) Indebtedness of the Company or any Restricted Subsidiary arising
from the honoring of a check, draft or similar instrument of such Person
drawn against insufficient funds, provided that such Indebtedness is
extinguished within five Business Days of its incurrence;
(xi) (A) Indebtedness of the Company or any Restricted Subsidiary
consisting of Capitalized Lease Obligations, Purchase Money Obligations or
Capital Expenditure Indebtedness (including refinancings thereof), in an
aggregate principal amount outstanding at any time for all such
Indebtedness not exceeding 5% of Consolidated Assets, and (B) other
Capital Expenditure Indebtedness of any Non-U.S. Restricted Subsidiary so
long as at the time of Incurrence thereof and after giving effect thereto
on a pro forma basis, (x) no Default or Event of Default will have
occurred and be continuing or would result therefrom and (y) the Company
could Incur $1.00 of additional Indebtedness pursuant to paragraph (a)
above; provided that any Indebtedness described in this clause (xi)
Incurred by a Restricted Subsidiary (other than a Note Guarantor) shall be
Incurred only in a transaction exempt from registration requirements under
United States securities laws, and not pursuant to a public offering in
the United States of America, and shall not be so registered for resale in
a public offering in the United States of America;
(xii) Indebtedness of the Company or any Restricted Subsidiary that
is a Note Guarantor (other than Indebtedness permitted to be Incurred
pursuant to paragraph (a) above or any other clause of this paragraph (b))
not to exceed $10,000,000 in aggregate
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principal amount outstanding at any given time for all such Indebtedness;
(xiii) Indebtedness of any Non-U.S. Restricted Subsidiary (other
than Indebtedness permitted to be Incurred pursuant to any other clause of
this paragraph (b)) not to exceed $25,000,000 in aggregate principal
amount outstanding at any given time for all such Indebtedness;
(xiv) Indebtedness of the Company or any Restricted Subsidiary
consisting of guarantees, indemnities or obligations in respect of
purchase price adjustments, in connection with the disposition of assets
permitted under this Indenture, in a principal amount not to exceed the
gross proceeds actually received by the Company or any Restricted
Subsidiary in connection with such disposition;
(xv) (1) Guarantees of the Company or any Restricted Subsidiary of
Specified Senior Indebtedness that is otherwise permitted to be Incurred
in accordance with this covenant, (2) Permitted Guarantees and (3)
Guarantees of the Company or any Restricted Subsidiary (x) of Specified
Indebtedness that is otherwise permitted to be Incurred in accordance with
this covenant and (y) that are permitted to be Incurred in accordance with
Section 4.12;
(xvi) Indebtedness of the Company or any Restricted Subsidiary (A)
with respect to any Specified Senior Indebtedness that is otherwise
permitted to be Incurred in accordance with this covenant, to the extent
arising by reason of any Lien granted by such Person to secure such
Specified Senior Indebtedness, (B) with respect to any Pari Passu
Indebtedness that is otherwise permitted to be Incurred in accordance with
this covenant, to the extent arising by reason of any Permitted Lien
granted by such Person to secure such Pari Passu Indebtedness, or (C) with
respect to any Specified Indebtedness that is otherwise permitted to be
Incurred in accordance with this covenant, to the extent arising by reason
of any Lien granted by such Person to secure such Specified Indebtedness
in accordance with Section 4.11;
(xvii) Indebtedness of any Non-U.S. Restricted Subsidiary to the
extent that the amount of such Indebtedness would be permitted as
revolving credit
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borrowing under the Credit Agreement, provided that the aggregate amount
of such Indebtedness shall reduce the amount of revolving credit
borrowings permitted to be Incurred under the Credit Agreement for
purposes of clause (i)(y) of this paragraph (b); and
(xviii) Any renewals, extensions, substitutions, refinancings or
replacements (each, for purposes of this clause (xviii), a "refinancing")
of any Indebtedness described in paragraph (a) or clause (ii), (iii), (v),
(vi), (vii) or (xi)(B) of this paragraph (b), including any successive
refinancings, so long as (A) any such new Indebtedness shall be in
principal amount that does not exceed the principal amount (or, if such
Indebtedness being refinanced provides for an amount less than the
principal amount thereof to be due and payable upon a declaration of
acceleration thereof, such lesser amount as of the date of determination)
so refinanced plus the lesser of (I) the stated amount of any premium or
other payment required to be paid in connection with such a refinancing
pursuant to the terms of the Indebtedness being refinanced and (II) the
amount of premium or other payment actually paid at such time to refinance
the Indebtedness, plus, in either case, the amount of expenses of the
Company or a Restricted Subsidiary incurred in connection with such
refinancing; (B) in the case of any refinancing of Pari Passu Indebtedness
or Subordinated Indebtedness, such new Indebtedness is made pari passu
with or subordinate in right of payment to the Notes and the Note
Guarantees, as applicable, at least to the same extent as the Indebtedness
being refinanced; (C) such new Indebtedness has an Average Life equal to
or longer than the Average Life of the Indebtedness being refinanced and a
final Stated Maturity the same as or later than the final Stated Maturity
of the Indebtedness being refinanced; and (D) in the case of any
refinancing of Indebtedness described in clause (v), (vi) or (xi)(B) of
this paragraph (b), such new Indebtedness shall be Incurred (other than by
a Note Guarantor) only in a transaction exempt from registration
requirements under United States securities laws, and not pursuant to a
public offering in the United States of America, and shall not be so
registered for resale in a public offering in the United States of
America, provided, that this clause (D) shall not apply in respect of
clause (vi) to the extent that the Acquired Indebtedness being refinanced
was Incurred in such a registered transaction or public
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offering so long as the obligor in respect of such Indebtedness does not
change as a result of such refinancing.
(c) For purposes of determining compliance with, and the outstanding
principal amount of any particular Indebtedness Incurred pursuant to and in
compliance with, this covenant, (i) Indebtedness Incurred pursuant to the Credit
Agreement on the Issue Date shall be treated as Incurred pursuant to clause (i)
of the foregoing paragraph (b), (ii) any other obligation of the obligor on such
Indebtedness arising under any Guarantee, Lien or letter of credit supporting
such Indebtedness shall be disregarded to the extent that such Guarantee, Lien
or letter of credit secures the principal amount of such Indebtedness; (iii) in
the event that Indebtedness meets the criteria of more than one of the types of
Indebtedness described in paragraph (b), subject to clause (i) of this paragraph
(c), the Company, in its sole discretion, shall classify such item of
Indebtedness and only be required to include the amount and type of such
Indebtedness in one of such clauses; and (iv) the amount of Indebtedness issued
at a price that is less than the principal amount thereof shall be equal to the
amount of the liability in respect thereof determined in accordance with GAAP.
(d) For purposes of determining compliance with any
Dollar-denominated restriction on the Incurrence of Non-Dollar Indebtedness
under clause (ix)(B)(y), (xi)(A), (xii) or (xiii) of the foregoing paragraph
(b), the Dollar-equivalent principal amount of such Indebtedness Incurred
pursuant thereto shall be calculated based on the relevant currency exchange
rate in effect on the date that such Indebtedness was Incurred, in the case of
term debt, or first committed, in the case of revolving credit debt, provided
that (x) the Dollar-equivalent principal amount of any such Indebtedness
outstanding on the Issue Date shall be calculated based on the relevant currency
exchange rate in effect on the Issue Date and (y) if such Indebtedness is
Incurred to refinance Non-Dollar Indebtedness previously Incurred pursuant to
clause (ix)(B)(y), (xi)(A), (xii) or (xiii) of the foregoing paragraph (b), and
such refinancing would cause the Dollar-denominated restriction under such
respective clause to be exceeded if calculated at the relevant currency exchange
rate in effect on the date of such refinancing, such Dollar-denominated
restriction shall be deemed not to have been exceeded so long as the principal
amount of such refinancing Indebtedness does not exceed the principal amount of
such Indebtedness being refinanced, but
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the ability to make subsequent Incurrences of Indebtedness subject to the
Dollar-denominated restriction under such respective clause shall be determined
as if the relevant currency exchange rate applied to any such previous
refinancing was the rate in effect on the date of such refinancing. The
principal amount of any such refinancing Indebtedness, if Incurred in a
different currency from the Indebtedness being refinanced, shall be calculated
based on the currency exchange rate applicable to the currencies in which such
respective Indebtedness is denominated that is in effect on the date of such
refinancing.
Section 4.09. Limitation on Restricted Payments. (a) The Company
shall not, and shall not permit any Restricted Subsidiary to, directly or
indirectly,:
(i) declare or pay any dividend or make any other distribution or
payment on or in respect of Capital Stock of the Company (including any
payment in connection with any merger or consolidation involving the
Company or any Restricted Subsidiary), or any other payment to the direct
or indirect holders of Capital Stock of the Company in their capacity as
such, except dividends or distributions payable solely in Capital Stock of
the Company (other than Redeemable Capital Stock);
(ii) declare or pay any dividend or make any other distribution or
payment on or in respect of Capital Stock of any Restricted Subsidiary
(including any payment in connection with any merger or consolidation
involving the Company or any Restricted Subsidiary), or any other payment
to the direct or indirect holders of Capital Stock of any Restricted
Subsidiary in their capacity as such, except dividends or distributions
payable (x) on a pro rata basis to all such holders of such Capital Stock,
whether in Capital Stock of such Restricted Subsidiary or otherwise, or
(y) to the Company or any Restricted Subsidiary;
(iii) purchase, redeem, defease or otherwise acquire or retire for
value any Capital Stock of the Company or any Restricted Subsidiary held
by Persons other than the Company or a Restricted Subsidiary, except from
all holders of such Capital Stock of a Restricted Subsidiary on a pro rata
basis;
(iv) make any principal payment on, or purchase, defease,
repurchase, redeem or otherwise acquire or
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retire for value, prior to any scheduled maturity, scheduled repayment,
scheduled sinking fund payment or other Stated Maturity, any Subordinated
Indebtedness of the Company or any Note Guarantor (other than in
anticipation of satisfying a sinking fund obligation, principal
installment or final maturity, in each case due within one year of the
date of such acquisition or retirement); or
(v) make any Investment (other than any Permitted Investment) in any
Person (any such dividend, distribution, purchase, redemption, repurchase,
defeasance, other acquisition, retirement or Investment being herein
referred to as a "Restricted Payment") if at the time of and after giving
effect to such Restricted Payment on a pro forma basis, (1) a Default or
Event of Default shall have occurred and be continuing or would result
therefrom; (2) the Company could not Incur at least $1.00 of additional
Indebtedness under Section 4.08(a); or (3) the aggregate amount of such
Restricted Payment and all other Restricted Payments declared or made from
and after the Issue Date would exceed, without duplication, the sum of:
(A) 50% of the Consolidated Net Income accrued during the
period (treated as one accounting period) from October 1, 1996 to the end
of the most recent fiscal quarter ending prior to the date of such
Restricted Payment for which consolidated financial statements of the
Company are available (or, if such Consolidated Net Income for such period
will be a deficit, minus 100% of such deficit);
(B) the aggregate Net Cash Proceeds received by the Company
either (x) as capital contributions in the form of common equity to the
Company after the Issue Date or (y) from the issuance or sale of Capital
Stock (other than Redeemable Capital Stock) of the Company after the Issue
Date, other than to a Subsidiary of the Company;
(C) the amount equal to the net reduction in Investments in
Unrestricted Subsidiaries resulting from (i) payments of dividends,
repayments of the principal of loans or advances or other transfers of
assets to the Company or any Restricted Subsidiary from any Unrestricted
Subsidiary or (ii) the redesignation of Unrestricted Subsidiaries as
Restricted Subsidiaries
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(valued in each case as provided in the definition of "Investment"), not
to exceed in the case of any such Unrestricted Subsidiary the aggregate
amount of Investments (other than Permitted Investments) made by the
Company or any Restricted Subsidiary in such Unrestricted Subsidiary after
the Issue Date;
(D) in the case of disposition or repayment of any Investment
constituting a Restricted Payment made after the Issue Date, an amount
equal to the lesser of the return of capital with respect to such
Investment and the initial amount of such Investment, in either case, less
the cost of the disposition of such Investment; and
(E) the aggregate net cash proceeds received after the Issue
Date by the Company or any Restricted Subsidiary from the issuance or sale
(other than to any Restricted Subsidiary) of debt securities or Redeemable
Capital Stock that have been converted into or exchanged for Capital Stock
of the Company (other than Redeemable Capital Stock) to the extent such
debt securities or Redeemable Capital Stock were originally sold for cash,
together with the aggregate net cash proceeds received by the Company or
any Restricted Subsidiary from such conversion or exchange at the time
thereof.
(b) The provisions of the foregoing paragraph (a) shall not
prohibit:
(i) the payment of any dividend within 60 days after the date of its
declaration, if at the date of declaration such payment would be permitted
by the foregoing paragraph (a), provided, however, that such dividend will
be included in the calculation of the amount of Restricted Payments;
(ii) the redemption, repurchase or other acquisition or retirement
of any shares of any class of Capital Stock of the Company or any
Restricted Subsidiary in exchange for (including any such exchange
pursuant to the exercise of a conversion right or privilege in connection
with which cash is paid in lieu of the issuance of fractional shares), or
out of the Net Cash Proceeds received by the Company of, a substantially
concurrent issue and sale of other shares of Capital Stock (other than
Redeemable Capital Stock, in the case of any such redemption, repurchase
or other
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acquisition or retirement of Capital Stock that is not Redeemable Capital
Stock) of MT Investors, Holding or the Company to any Person (other than
to a Subsidiary of the Company), provided that (x) such Net Cash Proceeds
will be excluded from clause (3) of the foregoing paragraph (a) and (y)
such redemption, repurchase or other acquisition or retirement will be
excluded in the calculation of the amount of Restricted Payments;
(iii) any redemption, repurchase or other acquisition or retirement
of Subordinated Indebtedness of the Company or any Note Guarantor in
exchange for, or out of the Net Cash Proceeds received by the Company of,
a substantially concurrent issue and sale of (x) Capital Stock (other than
Redeemable Capital Stock) of MT Investors, Holding or the Company to any
Person (other than to a Subsidiary of the Company), provided that such Net
Cash Proceeds will be excluded from clause (3) of the foregoing paragraph
(a), or (y) Indebtedness of the Company or any Note Guarantor so long as
such Indebtedness complies with subclauses (B) and (C) of Section
4.08(b)(xviii); provided, however, that such redemption, repurchase or
other acquisition or retirement will be excluded in the calculation of the
amount of Restricted Payments;
(iv) (A) loans, advances, dividends or distributions by the Company
to Holding or MT Investors (x) not to exceed $1,000,000 in any fiscal year
to permit Holding or MT Investors to pay the operational expenses
(including professional fees and expenses) incurred by Holding or MT
Investors in the ordinary course of business to the extent related to
Holding's investment in the Company or MT Investors' investment in
Holding, respectively, or (y) not to exceed an amount necessary to permit
Holding or MT Investors to pay its expenses incurred in connection with
any public offering of equity securities or of Indebtedness permitted by
this Indenture that has been terminated by the board of directors of the
Company, Holding or MT Investors, as applicable, in each case, the net
proceeds of which were specifically intended to be contributed or loaned
to the Company, and (B) loans or advances by the Company to Holding or MT
Investors not to exceed an amount necessary to permit each of Holding and
MT Investors to pay its interim expenses incurred in connection with any
public offering of equity securities or Indebtedness permitted by this
Indenture,
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the net proceeds of which are specifically intended to be contributed or
loaned to the Company, which loans or advances, unless such offering shall
have been terminated by the board of directors of the Company, Holding or
MT Investors, as applicable, shall be repaid to the Company promptly out
of the proceeds of such offering; provided, however, that such amounts
will be excluded in the calculation of the amount of Restricted Payments;
(v) loans, advances, dividends or distributions by the Company to
Holding or MT Investors to permit Holding or MT Investors, as the case may
be, to repurchase or otherwise acquire its common stock or options or
other rights in respect thereof, or payments by the Company to repurchase
or otherwise acquire such common stock or options or other rights in
respect thereof, in connection with the repurchase provisions under
employee stock option agreements or employee stock purchase agreements,
such payments, loans, advances, dividends or distributions not to exceed
$2,000,000 in any fiscal year and $5,000,000 in the aggregate; provided,
however, that such amounts will be included in the calculation of the
amount of Restricted Payments;
(vi) loans or advances to officers or employees of MT Investors,
Holding, the Company or any Restricted Subsidiary in the ordinary course
of business not to exceed $2,000,000 in the aggregate outstanding at any
time, provided, however, that such amounts will be excluded in the
calculation of the amount of Restricted Payments;
(vii) payments pursuant to the Tax Sharing Agreement, provided,
however, that such payments will be excluded in the calculation of the
amount of Restricted Payments;
(viii) payments by the Company to Holding or MT Investors not to
exceed an amount necessary to permit Holding or MT Investors to make
payments in respect of its indemnification obligations owing to its
directors or officers under Holding's or MT Investors' charter, by-laws or
indemnification agreements, to the extent such payments relate to the
Company or any of its Restricted Subsidiaries or to Holding's or MT
Investors's investment therein, provided, however, that
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such payments will be excluded in the calculation of the amount of
Restricted Payments;
(ix) the payment by the Company of, or loans, advances, dividends or
distributions by the Company to Holding or MT Investors to pay, dividends
on the common stock of the Company, Holding or MT Investors, as
applicable, following an initial public offering of such common stock, in
an amount not to exceed in any fiscal year 6% of the net proceeds received
by the Company, in or from such public offering; provided, however, that
such payments, loans, advances, dividends or distributions will be
included in the calculation of the amount of Restricted Payments;
(x) payments by the Company, or payments by the Company to Holding
or MT Investors to enable Holding or MT Investors, as applicable, to make
payments, to holders of the common stock of the Company, Holding or MT
Investors, as applicable, in lieu of issuance of fractional shares of such
common stock, in connection with any recapitalization of the Company,
Holding or MT Investors, as applicable, such payments not to exceed
$100,000 in the aggregate; provided, however, that such payments will be
included in the calculation of the amount of Restricted Payments; or
(xi) any purchase or repayment of Subordinated Indebtedness upon a
Change of Control or an Asset Sale to the extent required by the agreement
governing such Subordinated Indebtedness but only if (x) in the case of a
Change of Control, the Company shall have complied with all of its
obligations under Section 4.19 and purchased all Notes tendered pursuant
to the offer to repurchase all the Notes required thereby prior to
purchasing or repaying such Subordinated Indebtedness or (y) in the case
of an Asset Sale, the Company shall have applied the Net Cash Proceeds
from such Asset Sale in accordance with Section 4.18, shall have made an
Excess Proceeds Offer pursuant to such covenant, and shall have purchased
all Notes tendered pursuant to such Excess Proceeds Offer prior to
purchasing or repaying such Subordinated Indebtedness, provided that (1)
in either case the purchase price (stated as a percentage of principal
amount or issue price plus accrued original issue discount, if less) of
such Subordinated Indebtedness shall not be greater than the price (stated
as a percentage of principal amount) of the Notes pursuant to any such
offer to repurchase the
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Notes in the event of a Change of Control or Excess Proceeds Offer,
respectively, (2) in the case of such Asset Sale, the aggregate principal
amount of such Subordinated Indebtedness that the Company may so purchase
or repay may not exceed the amount of the Excess Proceeds, if any,
available for such Excess Proceeds Offer and remaining after the Company
shall have purchased all Notes tendered pursuant to such Excess Proceeds
Offer, and (3) in either case, any such purchase or repayment will be
included in the calculation of the amount of Restricted Payments.
Section 4.10. Limitation on Transactions with Affiliates. (a) The
Company shall not, and shall not permit any Restricted Subsidiary to, directly
or indirectly, conduct any business, enter into or suffer to exist any
transaction or series of related transactions (including the purchase, sale,
conveyance, disposition, lease or exchange of any property, the rendering of any
service or the making of any loan or advance) with, or for the benefit of, any
Affiliate of the Company (an "Affiliate Transaction") unless (i) such Affiliate
Transaction is on terms no less favorable to the Company or such Restricted
Subsidiary than those that could be obtained at the time of such Affiliate
Transaction in a comparable arm's length transaction with a Person who is not an
Affiliate of the Company, and (ii) in the event such an Affiliate Transaction
involves aggregate payments or value of $5,000,000 or greater, (x) a majority of
the Board of Directors of the Company, including a majority of the Disinterested
Directors, have determined in good faith that the criteria set forth in clause
(i) are satisfied and have approved the relevant Affiliate Transaction, such
approval to be evidenced by a Board Resolution, or (y) in the event there are no
Disinterested Directors, the Company has obtained a written opinion of an
investment banking firm or an independent appraiser or accounting firm, in
either case that is nationally recognized in the United States of America,
stating that the terms of such Affiliate Transaction are fair to the Company and
its Restricted Subsidiaries from a financial point of view (a "Fairness
Opinion"), and (iii) in the event that such Affiliate Transaction involves
aggregate payments or value of $15,000,000 or greater, the Company has obtained
a Fairness Opinion with respect to such Affiliate Transaction and (iv) in the
event that such Affiliate Transaction involves aggregate payments or value of
$5,000,000 or greater, the Company has delivered to the Trustee an Officers'
Certificate certifying that such Affiliate Transaction complies with the
foregoing clause (i), and that, if
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required by the foregoing clause (ii) or (iii), such Affiliate Transaction has
been approved by the Board of Directors (including a majority of the
Disinterested Directors) or the Company has obtained a Fairness Opinion with
respect thereto, together with copies of the relevant Board Resolution or
Fairness Opinion.
(b) The foregoing paragraph (a) will not apply to: (i) any
transaction permitted as a Restricted Payment pursuant to Section 4.09, (ii) the
payment of reasonable and customary regular fees to directors of the Company and
its Restricted Subsidiaries who are not employees of the Company or its
Subsidiaries, (iii) any transaction between the Company and a Restricted
Subsidiary or between Restricted Subsidiaries, (iv) any transaction with an
officer or member of the board of directors of the Company or any Restricted
Subsidiary in the ordinary course of business involving compensation, indemnity
or employee benefit arrangements; (v) loans or advances to officers of the
Company or any Restricted Subsidiary in the ordinary course of business not
exceeding $2,000,000 in the aggregate outstanding at any time; (vi) payments
pursuant to the Tax Sharing Agreement; (vii) any agreement as in existence on
the Issue Date, as the same may be amended from time to time in any manner not
adverse to the Holders; and (viii) payment to AEA of fees in an aggregate amount
not to exceed $1,000,000 in any fiscal year and the reimbursement of reasonable
out-of-pocket expenses incurred by AEA, in each case in connection with its
performance of services pursuant to the Management Services Agreement; (ix) the
Acquisition and all transactions related thereto (including but not limited to
the financing thereof); and (x) any transaction in the ordinary course of
business or approved by a majority of the Disinterested Directors, between the
Company or any Restricted Subsidiary and any Affiliate of the Company controlled
by the Company that is a joint venture or similar entity primarily engaged in a
Related Business.
Section 4.11. Limitation on Certain Liens. (a) The Company shall
not, and shall not permit any Restricted Subsidiary to, directly or indirectly,
create, incur, assume or suffer to exist any Lien (other than any Permitted
Lien) on or with respect to any of its property or assets (including any Capital
Stock), whether held on the Issue Date or thereafter acquired, or any income,
profits or proceeds therefrom, securing any Specified Indebtedness, unless (x)
effective provision is made contemporaneously therewith to secure the Notes and
the Note Guarantees, as applicable, (i) in the case of a Lien securing
Subordinated
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Indebtedness, by a perfected Lien on such property, assets, income, profits or
proceeds that is senior in priority to such Lien securing such Indebtedness, or
(ii) in the case of a Lien securing any other Specified Indebtedness, equally
and ratably with (or prior to) such Lien securing such Indebtedness and (y) any
such Restricted Subsidiary is a Note Guarantor.
(b) Notwithstanding the foregoing, any Lien created for the benefit
of the Notes and the Note Guarantees, as applicable, pursuant to the foregoing
paragraph (a) shall provide by its terms that such Lien shall be automatically
and unconditionally released and discharged upon (i) any sale, exchange or
transfer to any Person not an Affiliate of the Company of all of the Capital
Stock held by the Company or any Restricted Subsidiary in, or all or
substantially all the assets of, any Restricted Subsidiary creating such Lien
(which sale, exchange or transfer is not prohibited by this Indenture) or (ii)
the release and discharge of such Lien, which release and discharge occurs at a
time when (A) no other Specified Indebtedness remains secured by such property
or assets of the Company or such Restricted Subsidiary, as the case may be, or
(B) the holders of all such other Specified Indebtedness that is secured by such
property or assets of the Company or such Restricted Subsidiary also release
their security interest in such property or assets.
Section 4.12. Limitation on Certain Guarantees. (a) The Company will
not permit any Restricted Subsidiary, directly or indirectly, to Guarantee any
Specified Indebtedness (other than any Permitted Guarantee) unless such
Restricted Subsidiary simultaneously executes and delivers a supplemental
indenture to this Indenture providing for a Note Guarantee by such Restricted
Subsidiary on substantially the same terms as set forth in Article Ten of this
Indenture with respect to the Note Guarantee of Holding, provided that if such
Specified Indebtedness is Subordinated Indebtedness, such Restricted
Subsidiary's Guarantee with respect to such Specified Indebtedness shall be
subordinated in right of payment to such Restricted Subsidiary's Note Guarantee
substantially to the same extent as such Specified Indebtedness is subordinated
to the Notes or any Note Guarantee, as the case may be, or (if not so
subordinated) to any other Indebtedness of such Restricted Subsidiary.
(b) Notwithstanding the foregoing, any Note Guarantee by a
Restricted Subsidiary of the Notes shall
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provide by its terms that it shall be automatically and unconditionally released
and discharged upon (i) any sale, exchange or transfer to any Person not an
Affiliate of the Company of all of the Capital Stock held by the Company or any
Restricted Subsidiary in, or all or substantially all the assets of, such
Restricted Subsidiary (which sale, exchange or transfer is not prohibited by
this Indenture) or (ii) the release and discharge of the Guarantee that resulted
in the creation of such Note Guarantee, except a discharge or release by or as a
result of payment under such Guarantee, which release and discharge occurs at a
time when (A) no other Specified Indebtedness remains Guaranteed by such
Restricted Subsidiary (other than pursuant to Permitted Guarantees) or (B) the
holders of all such other Indebtedness that is Guaranteed by such Restricted
Subsidiary (other than pursuant to Permitted Guarantees) also release their
Guarantee by such Restricted Subsidiary, except a release as a result of payment
pursuant to such Guarantee by such Restricted Subsidiary.
Section 4.13. Certain Future Note Guarantors. (a) The Company shall
cause (x) certain U.S. Restricted Subsidiaries, as provided in Section 4.17, and
(y) each U.S. Restricted Subsidiary that Incurs Indebtedness (other than
Specified U.S. Subsidiary Indebtedness), to execute and deliver to the Trustee a
supplemental indenture pursuant to which such Subsidiary shall Guarantee payment
of the Notes on substantially the same terms as set forth in Article Ten of this
Indenture with respect to the Note Guarantee of Holding. The Company also shall
have the right to cause any Restricted Subsidiary to execute and deliver to the
Trustee a supplemental indenture pursuant to which such Restricted Subsidiary
will Guarantee payment of the Notes as aforesaid. Each Note Guarantee shall be
limited to an amount not to exceed the maximum amount that can be Guaranteed by
that Subsidiary without rendering the Note Guarantee, as it relates to such
Subsidiary, voidable under applicable law relating to fraudulent conveyance or
fraudulent transfer or similar laws affecting the rights of creditors generally.
For purposes of clause (x) of this paragraph (a), the Company shall have the
right to designate the U.S. Restricted Subsidiary or U.S. Restricted
Subsidiaries that constitute a U.S. Significant Subsidiary or U.S. Significant
Subsidiaries, as the case may be, required to provide a Note Guarantee or Note
Guarantees thereunder, provided that, after giving effect to such Note Guarantee
or Note Guarantees, there shall not be in existence any U.S. Restricted
Subsidiary that is a U.S. Significant Subsidiary.
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(b) Notwithstanding the foregoing, any Note Guarantee by a
Restricted Subsidiary shall provide by its terms that it shall be automatically
and unconditionally released and discharged upon (i) any sale, exchange or
transfer to any Person not an Affiliate of the Company of all of the Capital
Stock held by the Company in, or all or substantially all the assets of, such
Restricted Subsidiary (which sale, exchange or transfer is not prohibited by
this Indenture) or (ii) in the case of any such Guarantee given by reason of
clause (y) of the first sentence of the foregoing paragraph (a), the repayment
in full of the Indebtedness that caused such Restricted Subsidiary to provide
such Note Guarantee, which repayment occurs at a time when such Restricted
Subsidiary has no obligation in respect of any other Indebtedness (other than
Specified U.S. Subsidiary Indebtedness) and would not otherwise be required to
Guarantee the Notes under any provision of this Indenture.
Section 4.14. Limitation on Other Senior Subordinated Indebtedness.
The Company shall not, and shall not permit any Restricted Subsidiary that is a
Note Guarantor to, directly or indirectly, Incur any Indebtedness that is
subordinate or junior in right of payment in any respect to any other
Indebtedness, unless such Indebtedness is expressly subordinate in right of
payment to, or ranks pari passu with, the Notes, in the case of the Company, or
the Note Guarantees, in the case of a Note Guarantor; provided that the
foregoing restriction shall not apply to distinctions between categories of
Senior Indebtedness or Guarantor Senior Indebtedness that exist solely by reason
of Liens or Guarantees arising or created in respect of some but not all such
Senior Indebtedness or Guarantor Senior Indebtedness, as the case may be.
Section 4.15. Limitation on the Sale or Issuance of Preferred Stock
of Restricted Subsidiaries. The Company shall not sell, and shall not permit any
Restricted Subsidiary to, directly or indirectly, issue or sell, any shares of
Preferred Stock of any Restricted Subsidiary except (i) to the Company or a
Restricted Subsidiary, or to directors as director's qualifying shares to the
extent required by applicable law, or (ii) if, immediately after giving effect
to such issuance or sale, such Restricted Subsidiary would no longer constitute
a Restricted Subsidiary. The proceeds of any sale of such Preferred Stock
permitted by the preceding clause (ii) will be treated as Net Cash Proceeds from
an Asset Sale and must be applied in accordance with the terms of Section 4.18.
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Section 4.16. Limitation on Dividend and Other Payment Restrictions
Affecting Restricted Subsidiaries. (a) The Company shall not, and shall not
permit any Restricted Subsidiary to, directly or indirectly, create, incur,
assume or otherwise cause or suffer to exist or become effective any encumbrance
or restriction on the ability of any Restricted Subsidiary to (i) pay, directly
or indirectly, dividends, in cash or otherwise, or make any other distribution
on or in respect of its Capital Stock or any other interest or participation in,
or measured by, its profits, (ii) pay any Indebtedness owed to the Company or
any other Restricted Subsidiary, (iii) make loans or advances to the Company or
any other Restricted Subsidiary, (iv) transfer any of its properties or assets
to the Company or any other Restricted Subsidiary (other than any customary
restriction on transfers of property subject to a Lien permitted under this
Indenture that would not adversely affect the Company's ability to satisfy its
obligations hereunder) or (v) Guarantee any Indebtedness of the Company or any
other Restricted Subsidiary, except for such encumbrances or restrictions
existing under or by reason of (a) applicable law, (b) customary non-assignment
provisions of any lease, license or other contract, (c) any agreement or other
instrument of a Person acquired by the Company or any Restricted Subsidiary in
existence at the time of such acquisition (but not created in contemplation
thereof), which encumbrance or restriction is not applicable to any Person, or
the properties or assets of any Person, other than the Person, or the property
or assets of the Person, so acquired, (d) any existing agreement as in effect on
the Issue Date (to the extent of any encumbrances or restrictions in existence
thereunder on the Issue Date), including the Credit Agreement as in effect on
the Issue Date, (e) any encumbrance or restriction with respect to a Non-U.S.
Restricted Subsidiary pursuant to an agreement relating to Indebtedness of such
Non-U.S. Restricted Subsidiary permitted to be Incurred pursuant to clause (v),
(vi), (vii), (viii), (ix), (xi), (xii) or (xiii) of Section 4.08(b), (f) arising
or agreed to in the ordinary course of business and that do not, individually or
in the aggregate, detract from the value of property or assets of the Company or
any Restricted Subsidiary, in each case in any manner material to the Company or
such Restricted Subsidiary, (g) any restriction with respect to a Restricted
Subsidiary imposed pursuant to an agreement entered into for the sale or
disposition of all or substantially all the Capital Stock or assets of such
Restricted Subsidiary pending the closing of such sale or disposition, (h) any
restriction contained in security agreement or mortgage
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securing Indebtedness of any Restricted Subsidiary to the extent such
restriction restricts the transfer of the property subject to such security
agreement or mortgage, (i) subordination provisions contained in any
intercompany note representing Indebtedness of the Company owing to and held by
any Restricted Subsidiary or Indebtedness of a Note Guarantor owing to and held
by the Company or any Restricted Subsidiary, as contemplated by Section
4.08(b)(iv)(y), and (j) any agreement that extends, refinances, renews or
replaces any agreement or other instrument described in clause (c), (d) or (e)
of this Section 4.16(a), which is not more restrictive or less favorable to the
Noteholders than those existing under the agreement being extended, refinanced,
renewed or replaced.
(b) Without limiting the foregoing, the Company shall not permit
Swiss Subholding to, directly or indirectly, create, incur, assume or otherwise
cause or suffer to exist or become effective any encumbrance or restriction on
the ability of Swiss Subholding to pay dividends or make distributions, loans,
advances or other payments to the Company to enable the Company to pay principal
of the Notes at their final scheduled maturity (as in effect on the Issue Date)
and scheduled interest on the Notes, pursuant to the terms of the Credit
Agreement or any other agreement or instrument, except for such encumbrances or
restrictions permitted pursuant to clause (a), (c), (g), (i) or (j) of the
foregoing paragraph (a) (it being understood that the Credit Agreement will be
permitted to prohibit any redemption, repayment or acquisition of the Notes
prior to final scheduled maturity).
Section 4.17. Restriction on Transfer of Assets to Subsidiaries. The
Company shall not, and shall not permit any Restricted Subsidiary that is a Note
Guarantor to, sell, convey, transfer or otherwise dispose of its assets or
property to any U.S. Restricted Subsidiary, except for any disposition (a) made
in the ordinary course of business (including intercompany loans and cash equity
contributions), (b) that, after giving effect thereto, does not cause the
existence of a U.S. Significant Subsidiary or (c) made to such U.S. Restricted
Subsidiary if such U.S. Restricted Subsidiary prior to or simultaneously with
such disposition executes and delivers a supplemental indenture to this
Indenture providing for a Note Guarantee by such Restricted Subsidiary on
substantially the same terms as set forth in Article Ten of this Indenture with
respect to the Note Guarantee of Holding, which Note Guarantee shall be
subordinated to any Guarantee of such Restricted Subsidiary
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of Senior Indebtedness of the Company and shall be subordinated to any other
Indebtedness of such Restricted Subsidiary (that is not subordinated or junior
in right of payment to any other Indebtedness of such Restricted Subsidiary), in
each case to the same extent as the Notes are subordinated to the Senior
Indebtedness of the Company under this Indenture.
Section 4.18. Limitation on Disposition of Proceeds of Asset Sales.
(a) The Company shall not, and shall not permit any Restricted Subsidiary to,
engage in any Asset Sale unless (i) such Asset Sale is for not less than the
Fair Market Value of the assets sold (as determined, to the extent such Asset
Sale involves a Fair Market Value greater than $5,000,000, in good faith by the
Board of Directors whose determination shall be conclusive and evidenced by a
Board Resolution) and (ii) at least 75% of the consideration thereof received by
the Company or such Restricted Subsidiary is in the form of cash or Cash
Equivalents (with Indebtedness of the Company or any Restricted Subsidiary being
counted as cash for such purpose if the Company and each Restricted Subsidiary,
as the case may be, is unconditionally released from liability therefor). Net
Cash Proceeds of any Asset Sale may be applied to repay Specified Senior
Indebtedness (but only if the related loan commitments (if any) or amounts
available to be reborrowed (if any) under such Specified Senior Indebtedness are
permanently reduced by the amount of such payment). To the extent that such Net
Cash Proceeds are not applied as provided in the preceding sentence, the Company
or a Restricted Subsidiary, as the case may be, may apply the Net Cash Proceeds
from such Asset Sale, within 360 days of such Asset Sale, to an investment in
properties and assets to replace the properties and assets that were the subject
of such Asset Sale or in properties and assets that will be used in the
businesses of the Company or its Restricted Subsidiaries, as the case may be,
existing on the Issue Date or in businesses reasonably related thereto. Any Net
Cash Proceeds from any Asset Sale not applied as provided in the preceding two
sentences, within 360 days of such Asset Sale, constitute "Excess Proceeds"
subject to disposition as provided below.
(b) When the aggregate amount of Excess Proceeds exceeds
$15,000,000, the Company shall make an offer to purchase (an "Excess Proceeds
Offer") from all Noteholders and, to the extent required by the terms thereof,
from the holders of Pari Passu Indebtedness of the Company, an aggregate
principal amount of Notes and any such Pari Passu
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Indebtedness equal to such Excess Proceeds, at a purchase price (the "Excess
Proceeds Offer Price") in cash equal to 100% of the outstanding principal amount
thereof (or accreted value, as applicable), plus accrued and unpaid interest, if
any, to the purchase date in respect of the Excess Proceeds Offer in accordance
with the procedures set forth in this Section 4.18 or the agreements governing
any such Pari Passu Indebtedness. To the extent that the aggregate principal
amount of Notes and any such Pari Passu Indebtedness tendered pursuant to an
Excess Proceeds Offer is less than the Excess Proceeds, the Company may use such
deficiency for general corporate purposes. If the aggregate principal amount of
Notes and any such Pari Passu Indebteness validly tendered and not withdrawn
exceeds the Excess Proceeds, the portion of the Excess Proceeds (x) payable in
respect of the Notes shall be an amount (the "Note Amount") equal to the Excess
Proceeds multiplied by a fraction, the numerator of which is the outstanding
principal amount of the Notes, and the denominator of which is the sum of the
outstanding principal amount of the Notes and the outstand ing principal amount
(or accreted value, as applicable) of any such Pari Passu Indebtedness (less the
amount, if any, by which such product exceeds the principal amount of Notes
validly tendered and not withdrawn) and (y) payable in respect of any such Pari
Passu Indebtedness shall be an amount equal to the excess of the Excess Proceeds
over the Note Amount. Upon completion of such Excess Proceeds Offer, the amount
of Excess Proceeds shall be reset to zero.
(c) (1) Within 15 Business Days after the Company becomes obligated
to make an Excess Proceeds Offer, the Company shall deliver to the Trustee and
send, by first-class mail to each Holder, a written notice stating that the
Holder may elect to have his Notes purchased by the Company either in whole or
in part (subject to prorating as hereinafter described in the event the Excess
Proceeds Offer is oversubscribed) in integral multiples of $1,000 of principal
amount, at the applicable purchase price. The notice shall specify a purchase
date not less than 30 days nor more than 60 days after the date of such notice,
or such later date as may be necessary for the Company to comply with the
requirements under the Exchange Act (an "Excess Proceeds Purchase Date"), and
shall contain such information concerning the business of the Company which the
Company in good faith believes will enable such Holders to make an informed
decision (which at a minimum shall include (i) the most recently filed Annual
Report on Form 10-K (including audited consolidated financial statements) of the
Company, the most recent subsequently filed Quarterly Report on Form
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10-Q and any Current Report on Form 8-K of the Company filed subsequent to such
Quarterly Report, other than Current Reports describing Asset Sales otherwise
described in the offering materials (or corresponding successor reports), (ii) a
description of material developments in the Company's business subsequent to the
date of the latest of such reports, and (iii) if material, appropriate pro forma
financial information and all instructions and materials necessary to tender
Notes pursuant to the Excess Proceeds Offer, together with the information
contained in clause (3).
(2) Not later than the date upon which written notice of an Excess
Proceeds Offer is delivered to the Trustee as provided below, the Company shall
deliver to the Trustee an Officers' Certificate as to (i) the amount of the
aggregate Excess Proceeds Offer Price for the Notes, (ii) the allocation of the
Net Cash Proceeds from the Asset Sales pursuant to which such Excess Proceeds
Offer is being made and (iii) the compliance of such allocation with the
provisions of Section 4.18(a). On or prior to the Excess Proceeds Purchase Date,
the Company shall also irrevocably deposit with the Trustee or with a Paying
Agent (or, if the Company is acting as its own paying agent, segregate and hold
in trust) in Cash Equivalents an amount equal to the aggregate Excess Proceeds
Offer Price for the Notes to be held for payment in accordance with the
provisions of this Section 4.18. Upon the expiration of the period for which the
Excess Proceeds Offer remains open (the "Offer Period"), the Company shall
deliver to the Trustee for cancellation the Notes or portions thereof which have
been properly tendered to and are to be accepted by the Company. The Trustee
shall, on the Excess Proceeds Purchase Date, mail or deliver payment to each
tendering Holder in the amount of the purchase price. In the event that the
aggregate purchase price of the Notes delivered by the Company to the Trustee is
less than the aggregate Excess Proceeds Offer Price for the Notes, the Trustee
shall deliver the excess to the Company immediately after the expiration of the
Offer Period for application in accordance with this Section 4.18.
(3) Holders electing to have a Note purchased will be required to
surrender the Note with an appropriate form duly completed, to the Company at
the address specified in the notice at least three Business Days prior to the
Excess Proceeds Purchase Date. Holders will be entitled to withdraw their
election to have a Note purchased pursuant to this Section 4.18 if the Trustee
or the Company receives not later than one Business Day prior to the Excess
Proceeds
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Purchase Date, a telegram, telex, facsimile transmission or letter setting forth
the name of the Holder, the principal amount of the Note which was delivered for
purchase by the Holder, the certificate number of the Note in respect of which
such notice of withdrawal is being submitted and a statement that such Holder is
withdrawing his election to have such Note purchased. If at the expiration of
the Offer Period the aggregate principal amount of Notes surrendered by Holders
exceeds the aggregate Excess Proceeds Offer Price for the Notes, the Company
shall select the Notes to be purchased on a pro rata basis (with such
adjustments as may be deemed appropriate by the Company so that only Notes in
denominations of $1,000, or integral multiples thereof, shall be purchased).
Holders whose Notes are purchased only in part will be issued new Notes equal in
principal amount to the unpurchased portion of the Notes surrendered.
(4) At the time the Company delivers Notes to the Trustee which are
to be accepted for purchase, the Company shall also deliver an Officers'
Certificate stating the such Notes are to be accepted by the Company pursuant to
and in accordance with the terms of this Section 4.18. A Note shall be deemed to
have been accepted for purchase at the time the Trustee, directly or through an
agent, mails or delivers payment therefor to the surrendering Holder.
(d) The Company shall comply, to the extent applicable, with the
requirements of Section 14(e) of the Exchange Act and any other securities laws
or regulations in connection with the repurchase of Notes pursuant to this
covenant. To the extent that the provisions of any securities laws or
regulations conflict with provisions of this covenant, the Company shall comply
with the applicable securities laws and regulations and will not be deemed to
have breached its obligations under this paragraph by virtue thereof.
Section 4.19. Change of Control. (a) Upon the occurrence of a Change
of Control, each Noteholder shall have the right to require the Company to
repurchase all or any part of such Holder's Notes at a purchase price in cash
equal to 101% of the principal amount thereof, plus accrued and unpaid interest,
if any, to the date of purchase (subject to the right of Holders of record on
the relevant record date to receive interest due on the relevant interest
payment date), in accordance with the terms contemplated in this covenant.
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(b) A "Change of Control" means the occurrence of any of the
following events:
(i) prior to an initial Public Equity Offering, the Permitted Holder
ceases to be the beneficial owner (as defined in Rules 13d-3 and 13d-5
under the Exchange Act), directly or indirectly, of Voting Stock of each
of the Company and Holding representing more than 50% of the total voting
power of the Voting Stock of each of the Company and Holding (as a result
of the acquisition or issuance of securities, by merger or otherwise);
(ii) at any time after an initial Public Equity Offering, any
"person" or "group" (as such terms are used in Sections 13(d) and 14(d) of
the Exchange Act), other than the Permitted Holder, is or becomes (as the
result of the acquisition or issuance of securities, by merger or
otherwise) the Beneficial Owner, directly or indirectly, of (A) more than
50% of the common stock of the Company or Holding or (B) more than 50% of
the total voting power of the Voting Stock of the Company or Holding;
(iii) the merger or consolidation of the Company or Holding with or
into another Person, or of another Person with or into the Company or
Holding, or the sale, assignment, conveyance, transfer, lease or other
disposition of all or substantially all the assets of the Company or
Holding to another Person, and, in the case of any such merger or
consolidation, the securities of the Company or Holding, as the case may
be, that are outstanding immediately prior to such transaction and that
represent 100% of the aggregate voting power of the Voting Stock of the
Company or Holding, as the case may be, are changed into or exchanged for
cash, securities or property, unless (x) pursuant to such transaction such
securities are changed into or exchanged for (A) Voting Stock (other than
Redeemable Capital Stock) of the surviving or transferee corporation or
(B) cash, securities and other property in an amount that could be paid by
the Company as a Restricted Payment under this Indenture, and (y)
immediately after giving effect to such transaction, no "person" or
"group" (as such terms are used in Sections 13(d) and 14(d) of the
Exchange Act), other than the Permitted Holder, is or becomes (as the
result of the acquisition or issuance of securities, by merger or
otherwise) the Beneficial Owner, directly or
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indirectly, of more than 50% of the total voting power of the Voting Stock
of the surviving or transferee corporation;
(iv) during any consecutive two-year period, individuals who at the
beginning of such period constituted the Board of Directors of the Company
or Holding (together with any new directors whose election by such Board
of Directors or whose nomination for election by the shareholders of the
Company or Holding, as the case may be, was approved by a vote of 66 2/3%
of the directors then still in office who were either directors at the
beginning of such period or whose election as directors or nomination for
election was previously so approved) cease for any reason to constitute a
majority of the Board of Directors of the Company or Holding, as the case
may be, then in office; or
(v) the approval by stockholders of the Company of any plan or
proposal for the liquidation or dissolution of the Company, or any final
order, judgment or decree of a court of competent jurisdiction shall be
entered against the Company decreeing the dissolution or liquidation of
the Company.
(c) Prior to the mailing of the notice to Holders provided for in
paragraph (d) below, the Company shall have (x) terminated all commitments and
repaid in full all Indebtedness under the Credit Agreement and all other Credit
Agreement Obligations then due and owing, or (y) obtained the requisite consents
under the Credit Agreement to permit the purchase of the Notes as provided for
under this covenant. If a notice has been mailed when such condition precedent
has not been satisfied, the Company shall have no obligation to (and shall not)
effect the purchase of Notes until such time as such condition precedent is
satisfied. Failure to mail the notice on the date specified below or to have
satisfied the foregoing condition precedent by the date that the notice is
required to be mailed shall in any event constitute a covenant default under
Section 6.01(iv).
(d) Within 30 days following any Change of Control (or at the
Company's option, prior to such Change of Control, in anticipation of such
Change of Control), the Company shall send by first class mail a written notice
to each Holder at its registered address with a copy to the Trustee stating: (1)
that a Change of Control has occurred (or will occur) and that such Holder has
the right to
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require the Company to purchase such Holder's Notes at a purchase price in cash
equal to 101% of the principal amount thereof, plus accrued and unpaid interest,
if any, to date of repurchase (subject to the right of Holders of record on a
record date to receive interest on the relevant interest payment date); (2) the
circumstances and relevant facts and financial information regarding such Change
of Control; (3) the repurchase date (which shall be no earlier than 30 days nor
later than 60 days from the date such notice is mailed); (4) the instructions
determined by the Company, consistent with this covenant, that a Holder must
follow in order to have its Notes purchased; and (5) that, if such offer is made
prior to such Change of Control, payment is conditioned on the occurrence of
such Change of Control.
(e) Holders electing to have a Note purchased will be required to
surrender the Note, with an appropriate form duly completed, to the Company at
the address specified in the notice at least three Business Days prior to the
repurchase date. Holders will be entitled to withdraw their election if the
Trustee or the Company receives not later than two Business Days prior to the
purchase date, a telegram, telex, facsimile transmission or letter setting forth
the name of the Holder, the principal amount of the Note which was delivered for
purchase by the Holder, the certificate number of the Note in respect of which
such notice of withdrawal is being submitted and a statement that such Holder is
withdrawing his election to have such Notes purchased.
(f) On the purchase date, all Notes purchased by the Company under
this Section shall be delivered by the Trustee for cancellation, and the Company
shall pay the purchase price accrued and unpaid interest, if any, to the Holders
entitled thereto.
(g) The Company shall comply, to the extent applicable, with the
requirements of Section 14(e) under the Exchange Act and any other securities
laws or regulations in connection with the repurchase of Notes pursuant to this
covenant. To the extent that the provisions of any securities laws or
regulations conflict with provisions of this covenant, the Company shall comply
with the applicable securities laws and regulations and will not be deemed to
have breached its obligations under this paragraph by virtue thereof.
Section 4.20. Reporting Requirements. Notwithstanding that the Company may
not be required to
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remain subject to the reporting requirements of Section 13 or 15(d) of the
Exchange Act, to the extent permitted by the Exchange Act or the interpretations
of the SEC in respect thereof, the Company shall file with the SEC and provide,
within five days after the Company is required to file the same with the SEC, to
the Trustee the annual reports and the information, documents and other reports
that are specified in Sections 13 and 15(d) of the Exchange Act. In the event
that the Company is not permitted to file such reports, documents and
information with the SEC, the Company shall provide substantially similar
information to the Trustee, Noteholders and prospective Noteholders (upon
reasonable request) as if the Company were subject to the reporting requirements
of Section 13 or 15(d) of the Exchange Act. The Company also will comply with
the other provisions of TIA Section 314(a).
ARTICLE FIVE
SUCCESSOR CORPORATION
Section 5.01. Merger, Consolidation and Sale of Assets. (a) The
Company shall not, in any transaction or series of related transactions, merge
or consolidate with or into, or sell, assign, convey, transfer, lease or
otherwise dispose of all or substantially all of its properties and assets to,
any Person or Persons, and the Company shall not permit any Restricted
Subsidiary to enter into any such transaction or series of transactions if such
transaction or series of transactions, in the aggregate, would result in a sale,
assignment, conveyance, transfer, lease or other disposition of all or
substantially all of the properties and assets of the Company or of the Company
and its Subsidiaries on a consolidated basis to any other Person or Persons,
unless at the time of and immediately after giving effect thereto (i) either (A)
if the transaction or transactions is a merger or consolidation, the Company
shall be the surviving Person of such merger or consolidation, or (B) the Person
formed by such consolidation or into which the Company or such Restricted
Subsidiary is merged or to which the properties and assets of the Company or
such Restricted Subsidiary, as the case may be, substantially as an entirety,
are sold, assigned, transferred, leased or otherwise disposed of (any such
surviving Person or transferee Person being the "Surviving Entity") shall be a
corporation organized and existing under the laws of the United States of
America, any State thereof or the District of Columbia and shall expressly
assume by a supplemental
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indenture executed and delivered to the Trustee, in form and substance
satisfactory to the Trustee, all the obligations of the Company under the Notes
and this Indenture, and in each case, this Indenture shall remain in full force
and effect; and (ii) immediately after giving effect to such transaction or
series of related transactions on a pro forma basis (including, without
limitation, any Indebtedness Incurred or anticipated to be Incurred in
connection with or in respect of such transaction or series of transactions),
(x) no Default or Event of Default shall have occurred and be continuing and (y)
the Company or the Surviving Entity, as the case may be, could Incur $1.00 of
additional Indebtedness pursuant to Section 4.08(a); provided that this Section
5.01(a) shall not apply to or restrict the Merger.
In connection with any consolidation, merger, sale, assignment,
conveyance, transfer, lease or other disposition contemplated hereby, the
Company shall deliver, or cause to be delivered, to the Trustee, in form and
substance satisfactory to the Trustee, an Officers' Certificate and an Opinion
of Counsel, each stating that such consolidation, merger, sale, assignment,
conveyance, transfer, lease or other disposition and the supplemental indenture
in respect thereof comply with the requirements under this Indenture. In
addition, each Note Guarantor, unless it is the other party to the transaction
or unless its Note Guarantee will be released and discharged in accordance with
its terms as a result of the transaction, will be required to confirm, by
supplemental indenture, that its Note Guarantee will apply to the obligations of
the Company or the Surviving Entity under this Indenture.
(b) The Company and Holding agree, as soon as possible, to cause the
Merger to be consummated and the First Supplemental Indenture to be executed.
Concurrently with the execution and delivery of the First Supplemental
Indenture, the Company shall deliver to the Trustee an Opinion of Counsel in
form and substance satisfactory to the Trustee stating that such supplemental
indenture has been duly authorized, executed and delivered by Mettler-Toledo,
Inc. and Holding and that, subject to the applicable bankruptcy, insolvency,
fraudulent transfer, fraudulent conveyance, reorganization, moratorium and other
laws now or hereafter in effect affecting creditors' rights generally and the
general principles of equity (including, without limitation, standards of
materiality, good faith, fair dealing and reasonableness), such supplemental
indenture is a valid and legally binding agreement of Mettler-Toledo,
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Inc. and Holding, enforceable against such parties in accordance with its terms.
Section 5.02. Successor Substituted. Upon any consolidation or
merger or any sale, assignment, conveyance, transfer, lease or disposition of
all or substantially all of the assets of the Company in accordance with Section
5.01 in which the Company is not the continuing obligor under this Indenture,
the Surviving Entity shall succeed to, and be substituted for, and may exercise
every right and power of, the Company under this Indenture with the same effect
as if such successor had been named as the Company herein, and thereafter the
predecessor Person shall be relieved of all obligations under this Indenture and
the Notes, except that the predecessor Person in the case of a transfer by lease
will not be released from the obligation to pay the principal of, premium, if
any, and interest on the Notes.
For all purposes of this Indenture and the Notes (including the
provision of this Section 5.02 and Sections 4.08, 4.09 and 4.11), Subsidiaries
of any Surviving Entity shall, upon such transaction or series of related
transactions, become Restricted Subsidiaries or Unrestricted Subsidiaries as
provided pursuant to the definition of "Unrestricted Subsidiary" set forth in
Section 1.01, and all Indebtedness, and all Liens on property or assets, of the
Surviving Entity and its Subsidiaries (other than Indebtedness, and Liens on
property or assets, of the Company and its Restricted Subsidiaries outstanding
immediately prior to such transaction or series of related transactions) shall
be deemed to have been Incurred upon such transaction or series of related
transactions.
ARTICLE SIX
REMEDIES
Section 6.01. Events of Default. An "Event of Default" means any of the
following events:
(i) default in the payment of principal of, or premium, if any, when
due and payable, on any of the Notes (at its Stated Maturity, upon
optional redemption, required repurchase, or otherwise); or
(ii) default in any payment of an installment of interest on any of
the Notes when due and payable, for 30 days; or
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(iii) failure to perform or comply with Section 5.01; or failure to
offer to repurchase or to repurchase the Notes in the Event of a Change of
Control in accordance with Section 4.19; or
(iv) the Company or any Note Guarantor shall fail to perform or
observe any other term, covenant or agreement contained in the Notes, any
Note Guarantee or this Indenture (other than a Default specified in clause
(i), (ii) or (iii) of this Section 6.01) for a period of 30 days after
written notice of such failure requiring the Company to remedy the same
shall have been given (x) to the Company by the Trustee or (y) to the
Company and the Trustee by the Holders of at least 25% in aggregate
principal amount of the Notes then outstanding; or
(v) default or defaults under one or more mortgages, bonds,
debentures or other evidences of Indebtedness under which the Company or
any Restricted Subsidiary then has outstanding Indebtedness in excess of
$15,000,000, individually or in the aggregate, and either (a) such a
principal amount of such Indebtedness is already due and payable in full
or (b) such default or defaults have resulted in the acceleration of the
maturity of such Indebtedness; or
(vi) one or more judgments, orders or decrees of any court or
regulatory or administrative agency of competent jurisdiction for the
payment of money in excess of $15,000,000, either individually or in the
aggregate, shall be entered against the Company, any Note Guarantor or any
Significant Restricted Subsidiary or any of their respective properties
and shall not be discharged or fully bonded and either (a) any creditor
shall have commenced an enforcement proceeding upon such judgment, order
or decree or (b) there shall have been a period of 60 days after the date
on which any period for appeal has expired and during which a stay of
enforcement of such judgment, order or decree shall not be in effect; or
(vii) (A) any holder of at least $15,000,000 in aggregate principal
amount of Indebtedness of the Company or any Restricted Subsidiary as to
which a default has occurred and is continuing shall commence judicial
proceedings (which proceedings shall remain unstayed for 5 Business Days)
to foreclose upon assets of the Company or any Restricted Subsidiary
having an
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aggregate Fair Market Value, individually or in the aggregate, in excess
of $15,000,000 or shall have exercised any right under applicable law or
applicable security documents to take ownership of any such assets in lieu
of foreclosure or (B) any action described in the foregoing clause (A)
shall result in any court of competent jurisdiction issuing any order for
the seizure of such assets; or
(viii) any Note Guarantee of a Significant Note Guarantor ceases to
be in full force and effect or is declared null and void or any Note
Guarantor denies that it has any further liability under any Note
Guarantee, or gives notice to such effect (other than by reason of the
termination of this Indenture or the release of any such Note Guarantee in
accordance with this Indenture); or
(ix) there shall have been the entry by a court of competent
jurisdiction of (a) a decree or order for relief in respect of the
Company, any Significant Note Guarantor or any Significant Restricted
Subsidiary in an involuntary case or proceeding under any applicable
Bankruptcy Law or (b) a decree or order adjudging the Company, any
Significant Note Guarantor or any Significant Restricted Subsidiary
bankrupt or insolvent, or seeking reorganization, arrangement, adjustment
or composition of or in respect of the Company, any Significant Note
Guarantor or any Significant Restricted Subsidiary under any applicable
federal, state or foreign law, or appointing a custodian, receiver,
liquidator, assignee, trustee, sequestrator (or other similar official) of
the Company, any Significant Note Guarantor or any Significant Restricted
Subsidiary or of any substantial part of their respective properties, or
ordering the winding up or liquidation of their affairs, and any such
decree or order for relief shall continue to be in effect, or any such
other decree or order shall be unstayed and in effect, for a period of 60
consecutive days; or
(x) (a) the Company, any Significant Note Guarantor or any
Significant Restricted Subsidiary commences a voluntary case or proceeding
under any applicable Bankruptcy Law or any other case or proceeding to be
adjudicated bankrupt or insolvent, (b) the Company, any Significant Note
Guarantor or any Significant Restricted Subsidiary consents to the entry
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of a decree or order for relief in respect of the Company, any Significant
Note Guarantor or such Significant Restricted Subsidiary in an involuntary
case or proceeding under any applicable Bankruptcy Law or to the
commencement of any bankruptcy or insolvency case or proceeding against
it, (c) the Company, any Significant Note Guarantor or any Significant
Restricted Subsidiary files a petition or answer or consent seeking
reorganization or relief under any applicable federal or state law, (d)
the Company, any Significant Note Guarantor or any Significant Restricted
Subsidiary (1) consents to the filing of such petition or the appointment
of, or taking possession by, a custodian, receiver, liquidator, assignee,
trustee, sequestrator or similar official of the Company, any Significant
Note Guarantor or such Significant Restricted Subsidiary or of any
substantial part of their respective properties, (2) makes an assignment
for the benefit of creditors or (3) admits in writing its inability to pay
its debts generally as they become due, or (e) the Company, any
Significant Note Guarantor or any Significant Restricted Subsidiary takes
any corporate action in furtherance of any such actions in this paragraph
(x).
Section 6.02. Acceleration. If an Event of Default (other than an
Event of Default specified in Section 6.01(ix) or (x) with respect to the
Company) occurs and is continuing, the Trustee, by notice to the Company, or the
Holders of at least 25% in aggregate principal amount of the Notes then
outstanding, by notice to the Trustee and the Company, may declare the principal
of, premium, if any, and accrued interest on all the Notes due and payable
immediately, upon which declaration all amounts payable in respect of the Notes
shall immediately be due and payable; provided that so long as the Credit
Agreement shall be in full force and effect, if an Event of Default shall have
occurred and be continuing (other than an Event of Default specified in Section
6.01(ix) or (x) with respect to the Company), any such acceleration shall not be
effective until the earlier to occur of (x) five Business Days following
delivery of a written notice of such acceleration of the Notes to the Bank Agent
under the Credit Agreement and (y) the acceleration of any Indebtedness under
the Credit Agreement. If an Event of Default specified in Section 6.01(ix) or
(x) with respect to the Company occurs and is continuing, then the principal of,
premium, if any, and interest on all the Notes shall ipso facto become and be
immediately due and payable without any
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declaration or other act on the part of the Trustees or any Holder.
Notwithstanding the foregoing, in the event of a declaration of
acceleration in respect of the Notes because (x) an Event of Default specified
in Section 6.01(v) shall have occurred and be continuing, such declaration of
acceleration of the Notes and such Event of Default shall be automatically
annulled and rescinded and be of no further effect if the Indebtedness that is
the subject of such Event of Default has been discharged or paid in full or such
Event of Default shall have been cured or waived by the holders of such
Indebtedness and if such Indebtedness has been accelerated, then the holders
thereof have rescinded their declaration of acceleration in respect of such
Indebtedness or (y) an Event of Default specified in Section 6.01(vii) shall
have occurred and be continuing, such declaration of acceleration of the Notes
and such Event of Default shall be automatically annulled and rescinded and be
of no further effect if the proceedings or enforcement action with respect to
the Indebtedness that is the subject of such Event of Default is terminated or
rescinded, or such Indebtedness is paid in full and only so long as any holder
of such Indebtedness shall not have applied any assets referenced in Section
6.01(vii) in satisfaction of such Indebtedness and, in the case of both (x) and
(y) of this paragraph, written notice of such discharge, cure or waiver and
rescission, as the case may be, shall have been given to the Trustee within 60
days after such declaration of acceleration in respect of the Notes by the
Company or by the requisite holders of such Indebtedness or a trustee, fiduciary
or agent for such holders or other evidence satisfactory to the Trustee of such
events is provided to the Trustee and no other Event of Default shall have
occurred which has not been cured or waived during such 60-day period.
After a declaration of acceleration under this Indenture, but before
a judgment or decree for payment of money due has been obtained by the Trustee,
the Holders of a majority in aggregate principal amount of the outstanding
Notes, by written notice to the Company and the Trustee, may rescind such
declaration if:
(a) the Company has paid or deposited with the Trustee a sum
sufficient to pay:
(i) all sums paid or advanced by the Trustee under this
Indenture and the reasonable
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compensation, expenses, disbursements, and advances of the Trustee,
its agents and counsel,
(ii) all overdue interest on all Notes,
(iii) the principal of, and premium, if any, on any Notes
which have become due otherwise than by such declaration of
acceleration and interest thereon at the rate borne by the Notes,
and
(iv) to the extent that payment of such interest is lawful,
interest upon overdue interest at the rate borne by the Notes which
has become due otherwise than by such declaration of acceleration;
(b) the rescission would not conflict with any judgment or decree of
a court of competent jurisdiction; and
(c) all Events of Default, other than the non-payment of principal
of, premium, if any, and interest on the Notes that has become due solely
by such declaration of acceleration, have been cured or waived.
No such rescission shall affect any subsequent Default or Event of
Default or impair any right consequent thereon.
Section 6.03. Other Remedies. If an Event of Default occurs and is
continuing, the Trustee may pursue any available remedy by proceeding at law or
in equity to collect the payment of principal of, premium, if any, or interest
on the Notes or to enforce the performance of any provision of the Notes or this
Indenture.
All rights of action and claims under this Indenture or the Notes
may be enforced by the Trustee even if it does not possess any of the Notes or
does not produce any of them in the proceeding. A delay or omission by the
Trustee or any Noteholder in exercising any right or remedy accruing upon an
Event of Default shall not impair the right or remedy or constitute a waiver of
or acquiescence in the Event of Default. No remedy is exclusive of any other
remedy. All available remedies are cumulative to the extent permitted by law.
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Section 6.04. Waiver of Past Defaults. The Holders of not less than
a majority in aggregate principal amount of the outstanding Notes by notice to
the Trustee may, on behalf of the Holders of all the Notes, waive any past
Defaults and their consequences, except a Default or Event of Default specified
in Section 6.01(i) or (ii) or in respect of any covenant or provision hereof
which cannot be modified or amended without the consent of the Holder of each
Note outstanding. When a Default or Event of Default is so waived, it shall be
deemed cured and shall cease to exist.
Section 6.05. Control by Majority. The Holders of at least a
majority in aggregate principal amount of the outstanding Notes shall have the
right to direct the time, method and place of conducting any proceeding for any
remedy available to the Trustee, or exercising any trust or power conferred on
the Trustee; provided that the Trustee may refuse to follow any direction (a)
that conflicts with any rule of law or this Indenture, (b) that the Trustee
determines may be unduly prejudicial to the rights of another Noteholder, or
(c) that may expose the Trustee to personal liability unless the Trustee has
indemnification satisfactory to it in its sole discretion against any loss or
expense caused by its following such direction; and provided, further, that the
Trustee may take any other action deemed proper by the Trustee that is not
inconsistent with such direction.
Section 6.06. Limitation on Suits. No Holder of any Notes shall have
any right to institute any proceeding with respect to this Indenture or any
remedy thereunder, unless:
(a) the Holder gives written notice to the Trustee of a continuing
Event of Default;
(b) the Holders of at least 25% in aggregate principal amount of the
outstanding Notes make a writ ten request to the Trustee to pursue the
remedy within 30 days of the receipt of such notice;
(c) such Holder or Holders offer and, if requested, provide to the
Trustee reasonable indemnity, satisfactory to the Trustee against any
loss, liability or expense, to institute such proceeding as Trustee under
the Notes and this Indenture;
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(d) the Trustee does not comply with the request within 30 days
after receipt of the notice and, if requested, provision of indemnity; and
(e) during such 30-day period the Holders of a majority in aggregate
principal amount of the outstanding Notes do not give the Trustee a
direction which is inconsistent with the request.
The foregoing limitations shall not apply to a suit instituted by a
Holder for the enforcement of the payment of the principal of, premium, if any,
or interest on, such Note held by such Holder on or after the respective due
dates set forth in such Note.
Section 6.07. Right of Holders to Receive Payment. Notwithstanding
any other provision in this Indenture, the right of any Holder of Notes to
receive payment of the principal of and interest on such Note, on or after the
respective Stated Maturities expressed in such Note, or to bring suit for the
enforcement of any such payment on or after the respective Stated Maturities, is
absolute and unconditional and shall not be impaired or affected without the
consent of the Holder.
Section 6.08. Collection Suit by Trustee. If an Event of Default
specified in clause (i) or (ii) of Section 6.01 occurs and is continuing, the
Trustee may recover judgment in its own name and as trustee of an express trust
against the Company, any Note Guarantor or any other obligor on the Notes for
the whole amount of principal of, premium, if any, and accrued interest
remaining unpaid, together with interest on overdue principal and, to the extent
that payment of such interest is lawful, interest on overdue installments of
interest, in each case at the rate per annum borne by the Notes and such further
amount as shall be sufficient to cover the costs and expenses of collection,
including the reasonable compensation, expenses, disbursements and advances of
the Trustee, its agents and counsel.
Section 6.09. Trustee May File Proofs of Claims. The Trustee may
file such proofs of claim and other papers or documents as may be necessary or
advisable in order to have the claims of the Trustee (including any claim for
the reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel) and of the Holders allowed in any judicial
proceedings relative to the Company or any Note Guarantor (or any other obligor
upon the
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Notes), their creditors or their property and shall be entitled and empowered to
collect and receive any monies or other property payable or deliverable on any
such claims and to distribute the same, and any Custodian in any such judicial
proceedings is hereby authorized by each Holder to make such payments to the
Trustee and, in the event that the Trustee shall consent to the making of such
payments directly to the Holders, to pay to the Trustee any amount due to it for
the reasonable compensation, expenses, disbursements and advances of the
Trustee, its agent and counsel, and any other amounts due the Trustee under
Section 7.08. Nothing herein contained shall be deemed to authorize the Trustee
to authorize or consent to or accept or adopt on behalf of any Holder any plan
of reorganization, arrangement, adjustment or composition affecting the Notes
or the rights of any Holder thereof, or to authorize the Trustee to vote in
respect of the claim of any Holder in any such proceeding.
Section 6.10. Priorities. If the Trustee collects any money
pursuant to this Article Six, it shall pay out such money in the following
order:
First: to the Trustee for amounts due under Section 7.08;
Second: subject to Article Eleven, to Holders for interest accrued
on the Notes, ratably, without preference or priority of any kind,
according to the amounts due and payable on the Notes for interest;
Third: subject to Article Eleven, to Holders for principal amounts
owing under the Notes, ratably, without preference or priority of any
kind, according to the amounts due and payable on the Notes for prin-
cipal; and
Fourth: the balance, if any, to the Company or, to the extent the
Trustee collects any amount from any Note Guarantor, to such Note
Guarantor.
The Trustee, upon prior written notice to the Company, may fix a
record date and payment date for any payment to Noteholders pursuant to this
Section 6.10.
Section 6.11. Undertaking for Costs. In any suit for the enforcement
of any right or remedy under this Indenture or in any suit against the Trustee
for any action taken or omitted by it as Trustee, a court may in its discretion
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require the filing by any party litigant in the suit of an undertaking to pay
the costs of the suit, and the court in its discretion may assess reasonable
costs, including reasonable attorneys' fees, against any party litigant in the
suit, having due regard to the merits and good faith of the claims or defenses
made by the party litigant. This Section 6.11 does not apply to any suit by the
Trustee, any suit by a Holder pursuant to Section 6.07, or a suit by Holders of
more than 10% in aggregate principal amount of the outstanding Notes.
Section 6.12. Restoration of Rights and Remedies. If the Trustee or
any Holder has instituted any proceeding to enforce any right or remedy under
this Indenture, any Note or any Note Guarantee and such proceeding has been dis-
continued or abandoned for any reason, or has been determined adversely to the
Trustee or to such Holder, then and in every such case the Company, each Note
Guarantor, the Trustee and the Holders shall, subject to any determination in
such proceeding, be restored severally and respectively to their former
positions hereunder, and thereafter all rights and remedies of the Trustee and
the Holders shall continue as though no such proceeding had been instituted.
ARTICLE SEVEN
TRUSTEE
Section 7.01. Duties. (a) In case an Event of Default has occurred
and is continuing, the Trustee shall exercise such of the rights and powers
vested in it by this Indenture, and shall use the same degree of care and skill
in their exercise, as a prudent Person would exercise or use under the
circumstances in the conduct of such Person's own affairs.
(b) Except during the continuance of an Event of Default,
(1) the Trustee need perform only such duties as are specifically
set forth in this Indenture, and no implied covenants or obligations shall
be read into this Indenture against the Trustee; and
(2) in the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the correctness
of the opinions expressed therein, upon certificates or opinions
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furnished to the Trustee and conforming to the requirements of this
Indenture; but in the case of any such certificates or opinions which by
provision hereof are specifically required to be furnished to the Trustee,
the Trustee shall be under a duty to examine the same to determine whether
or not they conform to the requirements of this Indenture.
(c) No provision of this Indenture shall be construed to relieve the
Trustee from liability for its own negligent action, its own negligent failure
to act, or its own willful misconduct, except that:
(1) this paragraph does not limit the effect of paragraph (b) of
this Section 7.01;
(2) the Trustee shall not be liable for any error of judgment made
in good faith by a Trust Officer, unless it is proved that the Trustee was
negligent in ascertaining the pertinent facts; and
(3) the Trustee shall not be liable with respect to any action it
takes or omits to take in good faith in accordance with a direction
received by it pursuant to Section 6.05.
(d) No provision of this Indenture shall require the Trustee to
expend or risk its own funds or otherwise incur any financial liability in the
performance of any of its duties hereunder or in the exercise of any of its
rights or powers if it shall have reasonable grounds for believing that
repayment of such funds or adequate indemnity against such risk or liability is
not reasonably assured to it.
(e) Every provision of this Indenture that in any way relates to the
Trustee is subject to paragraphs (a), (b), (c) and (d) of this Section 7.01.
(f) The Trustee shall not be liable for interest on any assets
received by it except as the Trustee may agree with the Company. Assets held in
trust by the Trustee need not be segregated from other assets except to the
extent required by law.
Section 7.02. Rights of Trustee. Subject to Section 7.01 hereof and
the provisions of TIA Section 315:
(a) The Trustee may rely on any document believed by it to be
genuine and to have been signed or pre-
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sented by the proper Person. The Trustee need not investigate any fact or matter
stated in the document.
(b) Before the Trustee acts or refrains from acting, it may consult
with counsel and may require an Officers' Certificate or an Opinion of
Counsel, which shall conform to Sections 12.04 and 12.05. The Trustee
shall not be liable for any action it takes or omits to take in good faith
in reliance on such certificate or opinion.
(c) The Trustee may act through its attorneys and agents and shall
not be responsible for the misconduct or negligence of any agent appointed
with due care.
(d) The Trustee shall not be liable for any action taken or omitted
by it in good faith and believed by it to be authorized or within the dis-
cretion, rights or powers conferred upon it by this Indenture other than
any liabilities arising out of its own willful misconduct or negligence.
(e) The Trustee may consult with counsel of its own choosing and the
advice or opinion of such counsel as to matters of law shall be full and
complete authorization and protection in respect of any action taken,
omitted or suffered by it hereunder in good faith and in accordance with
the advice or opinion of such counsel.
(f) The Trustee shall not be bound to make any investigation into
the facts or matters stated in any resolution, certificate, statement,
instrument, opinion notice, request, direction, consent, order, bond,
debenture, or other paper or document, but the Trustee, in its discretion,
may make such further inquiry or investigation into such facts or matters
as it may see fit.
(g) The Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Indenture at the request, order or
direction of any of the Holders pursuant to the provisions of this
Indenture, unless such Holders shall have offered to the Trustee
reasonable security or indemnity against the costs, expenses and
liabilities which may be incurred therein or thereby.
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Section 7.03. Individual Rights of Trustee. The Trustee, any Paying
Agent, Registrar or any other agent of the Company, in its individual or any
other capacity, may become the owner or pledgee of Notes and, subject to Sec-
tions 7.11 and 7.12 and TIA Sections 310 and 311, may otherwise deal with the
Company and its Subsidiaries with the same rights it would have if it were not
the Trustee, Paying Agent, Registrar or such other agent.
Section 7.04. Trustee's Disclaimer. The Trustee makes no
representations as to the validity or sufficiency of this Indenture, the Notes
or of any Note Guarantee, it shall not be accountable for the Company's use or
application of the proceeds from the Notes, it shall not be responsible for the
use or application of any money received by any Paying Agent other than the
Trustee and it shall not be responsible for any statement in the Notes other
than the Trustee's certificate of authentication.
Section 7.05. Notice of Default. If a Default or an Event of Default
occurs and is continuing and if it is known to the Trustee, the Trustee shall
mail to each Holder notice of the Default or Event of Default within 30 days
after the occurrence thereof; provided that, except in the case of a Default or
Event of Default in the payment of the principal of, premium, if any, or
interest on any Note, the Trustee may withhold the notice to the Holders of such
Notes if a committee of its Trust Officers in good faith determines that
withholding the notice is in the interests of the Holders.
Section 7.06. Money Held in Trust. All moneys received by the
Trustee shall, until used or applied as herein provided, be held in trust for
the purposes for which they were received, but need not be segregated from other
funds except to the extent required herein or by law. The Trustee shall not be
under any liability for interest on any moneys received by it hereunder.
Section 7.07. Reports by Trustee to Holders. Within 60 days after
each November 15 beginning with the November 15 following the date of this
Indenture, the Trustee shall, to the extent that any of the events described in
TIA Section 313(a) occurred within the previous twelve months, but not
otherwise, mail to each Holder a brief report dated as of such November 15 that
complies with TIA Section 313(a). The Trustee also shall comply with TIA
Sections 313(b) and 313(c).
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A copy of each report at the time of its mailing to Holders shall be
mailed to the Company and filed with the SEC and each securities exchange, if
any, on which the Notes are listed.
The Company shall notify the Trustee in writing if the Notes become
listed on any securities exchange and of any delisting thereof.
Section 7.08. Compensation and Indemnity. The Company covenants and
agrees to pay the Trustee from time to time reasonable compensation for its
services. The Trustee's compensation shall not be limited by any law on
compensation of a trustee of an express trust. The Company shall reimburse the
Trustee upon request for all reasonable disbursements, expenses and advances
incurred or made by it, including costs of collection. Such expenses shall
include the reasonable compensation, disbursements and expenses of the Trustee's
agents and counsel, accountants and experts.
The Company shall indemnify the Trustee for, and hold it harmless
against, any loss, liability, claim or expense (including reasonable attorneys'
fees and expenses) incurred by it arising out of or in connection with the
administration of this trust and its rights or duties hereunder, including the
costs and expenses of defending itself against any claim or liability in
connection with the acceptance, exercise or performance of any of its powers or
duties hereunder. The Trustee shall notify the Company promptly of any claim
asserted against the Trustee for which it may seek indemnity. Failure by the
Trustee to so notify the Company shall not relieve the Company of its
obligations hereunder. The Company shall defend the claim and the Trustee shall
cooperate in the defense. The Trustee may have separate counsel and the Company
shall pay the reasonable fees and expenses of such counsel. The Company need not
reimburse any expense or indemnify against any loss or liability to the extent
incurred by the Trustee through its negligence, bad faith or willful misconduct.
To secure the Company's payment obligations in this Section 7.08,
the Trustee shall have a Lien prior to the Notes on all assets held or collected
by the Trustee, in its capacity as Trustee, except assets held in trust to pay
principal of, premium, if any, or interest on particular Notes.
When the Trustee incurs expenses or renders services in connection
with an Event of Default specified in
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Section 6.01(ix) or (x), the expenses and the compensation for the services are
intended to constitute expenses of administration under any Bankruptcy Law.
The Company's obligations under this Section 7.08 and any Lien
arising hereunder shall survive the resignation or removal of any trustee, the
discharge of the Company's obligations pursuant to Article Eight and/or the
termination of this Indenture.
Section 7.09. Replacement of Trustee. The Trustee may resign by so
notifying the Company. The Holders of a majority in principal amount of the
outstanding Notes may remove the Trustee by so notifying the Company and the
Trustee and may appoint a successor trustee with the Company's consent. The
Company shall remove the Trustee if:
(a) the Trustee fails to comply with Section 7.11;
(b) the Trustee is adjudged a bankrupt or an insolvent or an order
for relief is entered with respect to the Trustee under any Bankruptcy
Law;
(c) a receiver or other public officer takes charge of the Trustee
or its property; or
(d) the Trustee becomes incapable of acting.
If the Trustee resigns or is removed or if a vacancy exists in the
office of Trustee for any reason, the Company shall notify each Holder of such
event and shall promptly appoint a successor Trustee. The Trustee shall be
entitled to payment of its fees and reimbursement of its expenses while acting
as Trustee, and to the extent such amounts remain unpaid, the Trustee that has
resigned or has been removed shall retain the Lien afforded by Section 7.08.
Within one year after the successor Trustee takes office, the Holders of a
majority in principal amount of the outstanding Notes may appoint a successor
Trustee to replace the successor Trustee appointed by the Company. No retiring
Trustee shall have any obligation to provide to any successor Trustee any form
of indemnity or other financial assurances concerning the fees and expenses of
the successor Trustee.
A successor Trustee shall deliver a written accep tance of its
appointment to the retiring Trustee and to the Company. Immediately after that,
the retiring Trustee shall
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transfer all property held by it as Trustee to the successor Trustee, subject to
the Lien provided in Section 7.08, the resignation or removal of the retiring
Trustee shall become effective, and the successor Trustee shall have all the
rights, powers and duties of the Trustee under this Indenture. A successor
Trustee shall mail notice of its succession to each Noteholder.
If a successor Trustee does not take office within 60 days after the
retiring Trustee resigns or is removed, the retiring Trustee, the Company or the
Holders of at least 10% in principal amount of the outstanding Notes may peti-
tion any court of competent jurisdiction for the appointment of a successor
Trustee.
If the Trustee fails to comply with Section 7.11, any Holder may
petition any court of competent jurisdiction for the removal of the Trustee and
the appointment of a successor Trustee.
Notwithstanding replacement of the Trustee pursuant to this Section
7.09, the Company's obligations under Section 7.08 shall continue for the
benefit of the retiring Trustee.
Section 7.10. Successor Trustee by Merger, etc. If the Trustee
consolidates with, merges or converts into, or transfers all or substantially
all of its corporate trust business or assets to, another corporation or
national banking association, the resulting, surviving or transferee corporation
or national banking association without any further act shall, if such
resulting, surviving or transferee corporation or national banking association
is otherwise eligible hereunder, be the successor Trustee.
In case at the time such successor or successors by consolidation,
merger, conversion or transfer to the Trustee shall succeed to the trusts
created by this Indenture any of the Notes shall have been authenticated but not
delivered, any such successor to the Trustee may adopt the certificate of
authentication of any predecessor trustee, and deliver such Notes so
authenticated; and in case at that time any of the Notes shall not have been
authenticated, any successor to the Trustee may authenticate such Notes either
in the name of any predecessor hereunder or in the name of the successor to the
Trustee; and in all such cases such certificates shall have the full force which
it is anywhere in the Notes or in this Indenture provided that the certificate
of the Trustee shall have.
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Section 7.11. Eligibility; Disqualification. There shall at all
times be a Trustee hereunder which shall be eligible to act as Trustee under TIA
Sections 310(a)(1) and 310(a)(5) and which shall have a combined capital and
surplus of at least $50,000,000. If such corporation publishes reports of
condition at least annually, pursuant to law or to the requirements of federal,
state, territorial or District of Columbia supervising or examining authority,
then for the purposes of this Section, the combined capital and surplus of such
corporation shall be deemed to be its combined capital and surplus as set forth
in its most recent report of condition so published. If at any time the Trustee
shall cease to be eligible in accordance with the provisions of this Section,
the Trustee shall resign imme diately in the manner and with the effect
hereinafter specified in this Article. The Trustee shall comply with TIA
Section 310(b); provided, however, that there shall be excluded from the
operation of TIA Section 310(b)(1) any indenture or indentures under which other
securities or certificates of interest or participation in other securities of
the Company or any Note Guarantor are outstanding if the requirements for such
exclusion set forth in TIA Section 310(b)(1) are met.
Section 7.12. Preferential Collection of Claims Against Company. The
Trustee shall comply with TIA Section 311(a), excluding any creditor
relationship listed in TIA Section 311(b). If the present or any future Trustee
shall resign or be removed, it shall be subject to TIA Section 311(a) to the
extent provided therein.
ARTICLE EIGHT
SATISFACTION AND DISCHARGE OF INDENTURE
Section 8.01. Termination of the Company's Obligations. The Company
may terminate its obligations under the Notes and this Indenture, and the
obligations of any Note Guarantor shall terminate except those obligations
referred to in the penultimate paragraph of this Section 8.01, when:
(i) either (a) all the Notes previously authenticated and delivered
(except lost, stolen or destroyed Notes which have been replaced or paid)
have been delivered to the Trustee for cancellation or (b) all Notes not
theretofore delivered to the Trustee for cancellation (x) have become due
and payable
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hereunder, (y) will become due and payable at their Stated Maturity within
one year or (z) are to be called for redemption within one year under
arrangements satisfactory to the Trustee for the giving of notice of
redemption by the Trustee in the name, and at the expense, of the Company;
(ii) the Company shall have irrevocably deposited or caused to be
deposited with the Trustee under the terms of an irrevocable trust
agreement in form and substance satisfactory to the Trustee, as trust
funds in trust solely for the benefit of the Holders for that purpose,
cash in Dollars, U.S. Government Obligations, or a combination thereof, in
such amount as is sufficient without consideration of reinvestment of such
interest, to pay and discharge the entire indebtedness on the Notes
(except lost, stolen or destroyed Notes which have been replaced or paid)
not theretofore delivered to the Trustee for cancellation, including
principal of, premium, if any, and interest on the outstanding Notes at
such Stated Maturity or the relevant Redemption Date; provided that the
Trustee shall have been irrevocably instructed to apply such money to the
payment of said principal, premium, if any, and interest with respect to
the Notes at such Stated Maturity or Redemption Date; and, provided,
further, that from and after the time of deposit, the money deposited
shall not be subject to the rights of holders of Senior Indebtedness
pursuant to the provisions of Article Ten;
(iii) the Company shall have paid all other sums payable by it
hereunder; and
(iv) the Company shall have delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all conditions
precedent providing for the termination of the Company's obligation under
the Notes and this Indenture have been complied with.
Notwithstanding the foregoing paragraph, the Company's obligations
in Sections 2.05, 2.06, 2.07, 2.08, 4.01, 4.02 and 7.08 and any Note Guarantor's
obligations in respect thereof shall survive until the Notes are no longer
outstanding pursuant to the last paragraph of Section 2.08. After the Notes are
no longer outstanding, the Company's obligations in Sections 7.08, 8.04 and 8.05
and any Note Guarantor's obligations in respect thereof shall survive.
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After such delivery or irrevocable deposit the Trustee upon request
shall acknowledge in writing the dis charge of the Company's and any Note
Guarantor's obligations under the Notes and this Indenture except for those sur-
viving obligations specified above.
Section 8.02. Defeasance and Covenant Defeasance. (a) The Company
may, at its option by Board Resolution which shall be delivered to the Trustee,
at any time, with respect to the outstanding Notes and the Note Guarantees,
elect to have either paragraph (b) or paragraph (c) below be applied to the
outstanding Notes and the Note Guarantees upon compliance with the conditions
set forth in paragraph (d).
(b) Upon the Company's exercise under paragraph (a) of the option
applicable to this paragraph (b), each of the Company and any Note Guarantor
shall be deemed to have been released and discharged from its respective
obligations with respect to the outstanding Notes and the Note Guarantees on the
date the conditions set forth below are satisfied (hereinafter, "defeasance").
For this purpose, such defeasance means that the Company shall be deemed to have
paid and discharged the entire indebtedness represented by the then outstanding
Notes, which shall thereafter be deemed to be "outstanding" only for the
purposes of paragraph (e) below and the other Sections of and matters under
this Indenture referred to in (i) and (ii) of this paragraph, and to have
satisfied all its other obligations under such Notes and this Indenture insofar
as such Notes are concerned (and the Trustee, at the expense of the Company,
shall execute proper instruments acknowledging the same), and Holders of the
Notes and the Note Guarantees and any amounts deposited under paragraph (d)
below shall cease to be subject to any obligations to, or the rights of, any
holder of Senior Indebtedness or Guarantor Senior Indebtedness under Articles
Ten, Eleven or otherwise, except for the following which shall survive until
otherwise terminated or discharged hereunder: (i) the rights of Holders of
outstanding Notes to receive solely from the trust fund described in paragraph
(d) below and as more fully set forth in such paragraph, payments in respect of
the principal of, premium, if any, and interest on such Notes when such payments
are due, (ii) the Company's obligations with respect to such Notes under
Sections 2.06, 2.07 and 4.02, and, with respect to the Trustee, under Section
7.08 and any Note Guarantor's obligations in respect thereof, (iii) the rights,
powers, trusts, duties, indemnities and immunities of the Trustee hereunder and
(iv)
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this Section 8.02 and Section 8.05. Subject to compliance with this Section
8.02, the Company may exercise its option under this paragraph (b)
notwithstanding the prior exercise of its option under paragraph (c) below with
respect to the Notes.
(c) Upon the Company's exercise under paragraph (a) of the option
applicable to this paragraph (c), the Company shall be released and discharged
from its obligations under any covenant contained in Sections 4.03 through 4.20
with respect to the outstanding Notes on and after the date the conditions set
forth below are satisfied (hereinafter, "covenant defeasance"), and the Notes
shall thereafter be deemed to be not "outstanding" for the purpose of any
direction, waiver, consent or declaration or act of Holders (and the
consequences of any thereof) in connection with such covenants, but shall
continue to be deemed "outstanding" for all other purposes hereunder and Holders
of the Notes and the Note Guarantees and any amounts deposited under paragraph
(d) below shall cease to be subject to any obligations to, or the rights of, any
holder of Senior Indebtedness or Guarantor Senior Indebtedness under Articles
Ten, Eleven or otherwise. For this purpose, such covenant defeasance means that,
with respect to the outstanding Notes, the Company and any Note Guarantor may
omit to comply with and shall have no liability in respect of any term,
condition or limitation set forth in any such covenant, whether directly or
indirectly, by reason of any reference elsewhere herein to any such covenant or
by reason of any reference in any such covenant to any other provision herein or
in any other document and such omission to comply shall not constitute a Default
or an Event of Default under Article Six, but, except as specified above, the
remainder of this Indenture and such Notes shall be unaffected thereby. In
addition, in the event covenant defeasance occurs, the Events of Default
specified in Sections 6.01(v), (vi) or (vii) will no longer constitute Events of
Default with respect to the Notes.
(d) The following shall be the conditions to application of either
paragraph (b) or paragraph (c) above to the outstanding Notes:
(i) the Company shall irrevocably have deposited or caused to be
deposited with the Trustee (or another trustee satisfying the requirements
of Section 7.11 who shall agree to comply with the provisions of this
Section 8.02 applicable to it) as trust funds in trust for the purpose of
making the following payments,
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specifically pledged as security for, and dedicated solely to, the benefit
of the Holders of such Notes, (x) cash in Dollars, or (y) U.S. Government
Obligations maturing as to principal, premium, if any, and interest in
such amounts of money and at such times as are sufficient without
consideration of any reinvestment of such interest, to pay principal of,
premium, if any, and interest on the outstanding Notes on the Stated
Maturity or relevant Redemption Date of such principal or installment of
interest not later than one day before the due date of any payment, or (z)
a combination thereof, sufficient, in the opinion of a nationally
recognized firm of independent public accountants expressed in a written
certification thereof delivered to the Trustee, to pay and discharge and
which shall be applied by the Trustee (or other qualifying trustee) to pay
and discharge principal of, premium, if any, and interest on the
outstanding Notes on the Maturity Date or Redemption Date or otherwise in
accordance with the terms of this Indenture and of such Notes; provided
that the Trustee shall have received an irrevocable written order from the
Company instructing the Trustee (or other qualifying trustee) to apply
such money or the proceeds of such U.S. Government Obligations to said
payments with respect to the Notes;
(ii) in the case of an election under paragraph (b) above, the
Company shall have delivered to the Trustee an Opinion of Counsel stating
that (x) the Company has received from, or there has been published by,
the Internal Revenue Service a ruling, which ruling must be referred to,
or (y) since the Issue Date, there has been a change in the applicable
Federal income tax law, in either case to the effect that, and based
thereon such opinion shall confirm that, the Holders of the outstanding
Notes will not recognize income, gain or loss for federal income tax
purposes as a result of such defeasance and will be subject to Federal
income tax on the same amounts, in the same manner and at the same times
as would have been the case if such defeasance had not occurred;
(iii) in the case of an election under paragraph (c) above, the
Company shall have delivered to the Trustee an Opinion of Counsel to the
effect that the Holders of the outstanding Notes will not recognize
income, gain or loss for Federal income tax purposes as a result of such
covenant defeasance and will be subject to Federal income tax on the same
amounts, in the
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same manner and at the same times as would have been the case if such
covenant defeasance had not occurred;
(iv) no Default or Event of Default shall have occurred and be
continuing on the date of such deposit or, insofar as Events of Default
specified in Section 6.01(ix) or (x) are concerned, at any time during the
period ending on the 91st day after the date of such deposit (it being
understood that this condition shall not be deemed satisfied until the
expiration of such period);
(v) such defeasance or covenant defeasance shall not cause the
Trustee to have a conflicting interest with respect to any securities of
the Company or any Note Guarantor;
(vi) such defeasance or covenant defeasance shall not result in a
breach or violation of, or constitute a Default or Event of Default under,
this Indenture or any other agreement or instrument to which the Company
or any Note Guarantor is a party or by which it is bound;
(vii) the Company shall have delivered to the trustee an Opinion of
Counsel stating that (A) the trust funds will not be subject to any rights
of holders of Senior Indebtedness, including, without limitation, those
arising under this Indenture, and (B) after the 91st day following the
deposit or after the date such Opinion of Counsel is delivered, the trust
funds will not be subject to the effect of any applicable bankruptcy,
insolvency, reorganization or similar laws affecting creditors' rights
generally; and
(viii) the Company shall have delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each satisfactory in form and
substance to the Trustee, stating that all conditions precedent provided
for relating to either the defeasance under paragraph (b) above or the
covenant defeasance under paragraph (c) above, as the case may be, have
been complied with.
(e) All cash in Dollars and U.S. Government Obligations (including
the proceeds thereof) deposited with the Trustee (or other qualifying trustee,
collectively for purposes of this paragraph (e), the "Trustee") pursuant to
paragraph (d) above in respect of the outstanding Notes shall be held in trust
and applied by the Trustee, in
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accordance with the provisions of such Notes and this Indenture, to the payment,
either directly or through any Paying Agent (other than the Company or any
Affiliate of the Company) as the Trustee may determine, to the Holders of such
Notes of all sums due and to become due thereon in respect of principal,
premium, if any, and interest, but such money need not be segregated from other
funds except to the extent required by law.
The Company shall pay and indemnify the Trustee against any tax, fee
or other charge imposed on or assessed against the U.S. Government Obligations
deposited pursuant to paragraph (d) above or the principal, premium, if any, and
interest received in respect thereof other than any such tax, fee or other
charge which by law is for the account of the Holders of the outstanding Notes.
Anything in this Section 8.02 to the contrary notwithstanding, the
Trustee shall deliver or pay to the Company from time to time upon the request,
in writing, by the Company any cash in Dollars or U.S. Government Obligations
held by it as provided in paragraph (d) above which, in the opinion of a
nationally recognized firm of independent public accountants expressed in a
written certification thereof delivered to the Trustee, are in excess of the
amount thereof which would then be required to be deposited to effect an
equivalent legal defeasance or covenant defeasance.
Section 8.03. Application of Trust Money. The Trustee shall hold in
trust cash in Dollars or U.S. Government Obligations deposited with it pursuant
to Sections 8.01 and 8.02, and shall apply the deposited cash in Dollars and
U.S. Government Obligations in accordance with this Indenture to the payment of
principal of, premium, if any, and interest on the Notes.
Section 8.04. Repayment to Company or Note Guarantors. Subject to
Sections 7.08, 8.01 and 8.02, the Trustee shall promptly pay to the Company, or
if deposited with the Trustee by any Note Guarantor, to such Note Guarantor,
upon receipt by the Trustee of an Officers' Certificate, any excess money,
determined in accordance with Section 8.02, held by it at any time. The Trustee
and the Paying Agent shall pay to the Company or any Note Guarantor, as the case
may be, upon receipt by the Trustee or the Paying Agent, as the case may be, of
an Officers' Certificate, any money held by it for the payment of principal,
premium, if any, or interest that remains
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unclaimed for two years; provided that the Trustee and the Paying Agent before
being required to make any payment may, but need not, at the expense of the
Company cause to be published once in a newspaper of general circulation in The
City of New York or mail to each Holder entitled to such money notice that such
money remains unclaimed and that after a date specified therein, which shall be
at least 30 days from the date of such publication or mailing, any unclaimed
balance of such money then remaining will be repaid to the Company. After
payment to the Company or any Note Guarantor, as the case may be, Holders
entitled to money must look solely to the Company for payment as general
creditors unless an applicable abandoned property law designates another Person,
and all liability of the Trustee or Paying Agent with respect to such money
shall thereupon cease.
Section 8.05. Reinstatement. If the Trustee or Paying Agent is
unable to apply any cash in Dollars or U.S. Government Obligations in accordance
with this Indenture by reason of any legal proceeding or by reason of any order
or judgment of any court or governmental authority enjoining, restraining or
otherwise prohibiting such application, then the Company's obligations under
this Indenture and the Notes shall be revived and reinstated as though no
deposit had been made pursuant to this Indenture until such time as the Trustee
is permitted to apply all such cash in Dollars or U.S. Government Obligations in
accordance with this Indenture; provided that if the Company has made any
payment of principal of, premium, if any, or interest on any Notes because of
the reinstatement of its obligations, the Company or any such Note Guarantor, as
the case may be, shall be subrogated to the rights of the Holders of such Notes
to receive such payment from the cash in Dollars or U.S. Government Obligations
held by the Trustee or Paying Agent.
ARTICLE NINE
AMENDMENTS, SUPPLEMENTS AND WAIVERS
Section 9.01. Without Consent of Holders. The Company, the Note
Guarantors, and the Trustee may amend, waive or supplement this Indenture or the
Notes without notice to or consent of any Holder:
(a) to cure any ambiguity, omission, defect or inconsistency;
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(b) to comply with Article Five;
(c) to add Guarantees with respect to the Notes;
(d) to secure the Notes;
(e) to add to the covenants of the Company for the benefit of the
Holders;
(f) to surrender any right or power conferred upon the Company or
any Note Guarantor;
(g) to make any change that does not adversely affect the rights of
any Holder; or
(h) to comply with any requirements of the SEC in order to effect or
maintain the qualification of this Indenture under the TIA.
After an amendment, supplement or waiver under this Section 9.01
becomes effective, the Company shall mail to the Holders, with a copy to the
Trustee, a notice briefly describing the amendment, supplement or waiver. Any
failure of the Company to mail such notice, or any defect therein, shall not,
however, in any way impair or affect the validity of any supplemental indenture.
Notwithstanding the foregoing and Section 9.02, on or after the date
hereof (but after the execution and delivery of this Indenture and the issuance
of the Notes and after or concurrently with consummation of the Merger), the
Company, Holding and the Trustee shall execute and deliver the First
Supplemental Indenture attached as Exhibit B hereto, without notice to or
consent of any Noteholder.
Section 9.02. With Consent of Holders. Subject to Section 6.04, the
Company and the Note Guarantors when authorized by Board Resolutions of their
respective Boards of Directors, and the Trustee may amend or modify this
Indenture or the Notes with the written consent of the Holders of not less than
a majority in aggregate principal amount of the Notes then outstanding, and the
Holders of not less than a majority in aggregate principal amount of the Notes
then outstanding by written notice to the Trustee, may waive future compliance
by the Company or any Note Guarantor with any provision of this Indenture, the
Notes or the Note Guarantees except a default in the payment of principal of,
premium, if any, or interest on the Notes.
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Notwithstanding the provisions of this Section 9.02, without the
consent of each Holder affected, an amendment, modification or waiver,
including a waiver pursuant to Section 6.04, may not:
(a) reduce the principal amount outstanding of or extend the Stated
Maturity of any Note or alter the redemption provisions with respect
thereto;
(b) make the principal of, premium, if any, or interest on any Note
payable in money other than that stated in the Note;
(c) reduce the percentage in outstanding aggregate principal amount
of Notes the Holders of which must consent to an amendment, supplement or
waiver of or consent to take any action under any provision of this
Indenture, the Notes or any Note Guarantee;
(d) modify or change Section 4.14 or any provision of this Indenture
affecting the subordination of the Notes or any Note Guarantee in a manner
adverse to the Holders;
(e) impair the right of any Holder to receive payment of principal
of, premium, if any, and interest on such Holder's Notes on or after the
due dates therefor or to institute suit for the enforcement of any payment
on or with respect to the Notes;
(f) waive a default in the payment of the principal of, premium, if
any, or interest on, or redemption or an offer to purchase required
hereunder with respect to, any Note or any Note Guarantee (except for any
waiver of a default in payment to the extent resulting from a declaration
of acceleration under this Indenture, which declaration has been rescinded
by the Holders as contemplated by the third full paragraph under Section
6.02);
(g) following the occurrence of a Change of Control or an Asset
Sale, amend, change or modify the obligation of the Company to offer to
repurchase and to repurchase the Notes in the event of a Change of Control
or make and consummate the Excess Proceeds Offer with respect to any Asset
Sale, including by modifying any of the provisions or definitions with
respect thereto;
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(h) reduce or change the rate or time for payment of interest on the
Notes;
(i) modify this Section 9.02 or Section 6.04 or Section 6.07; or
(j) release any Significant Note Guarantor from any of its
obligations under its Note Guarantee or this Indenture other than in
compliance with this Indenture.
Notwithstanding the foregoing, no amendment shall modify any
provision of this Indenture so as to affect adversely the rights of any Senior
Indebtedness or any Guarantor Senior Indebtedness representing Credit Agreement
Obligations at the time outstanding which are entitled to the benefits of
subordination under this Indenture (or any group or representative thereof
authorized to give a consent) without the written consent of such holders.
It shall not be necessary for the consent of the Holders under this
Section 9.02 to approve the particular form of any proposed amendment,
supplement or waiver, but it shall be sufficient if such consent approves the
substance thereof.
After an amendment, supplement or waiver under this Section 9.02
becomes effective, the Company shall mail to the Holders, with a copy to the
Trustee, a notice briefly describing the amendment, supplement or waiver. Any
failure of the Company to mail such notice, or any defect therein, shall not,
however, in any way impair or affect the validity of any supplemental indenture.
Section 9.03. Compliance with Trust Indenture Act. Every amendment
of or supplement to this Indenture, the Notes or the Note Guarantees shall
comply with the TIA as then in effect.
Section 9.04. Revocation and Effect of Consents. Until an amendment,
supplement or waiver becomes effective, a consent to it by a Holder is a
continuing consent by such Holder and every subsequent Holder of that Note or
portion of that Note that evidences the same debt as the consenting Holder's
Note, even if notation of the consent is not made on any Note. However, any such
Holder or subsequent Holder may revoke the consent as to his Note or portion of
a Note prior to such amendment, supplement or waiver becoming effective. Such
revocation shall be effective only if the Trustee receives the notice of
revocation before the date
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the amendment, supplement or waiver becomes effective. Notwithstanding the
above, nothing in this paragraph shall impair the right of any Holder under
Section 316(b) of the TIA.
The Company may, but shall not be obligated to, fix a record date
for the purpose of determining the Holders entitled to consent to any amendment,
supplement or waiver. If a record date is fixed, then notwithstanding the second
and third sentences of the immediately preceding paragraph, those Persons who
were Holders at such record date (or their duly designated proxies), and only
those Persons, shall be entitled to consent to such amendment, supplement or
waiver or to revoke any consent previously given, whether or not such Persons
continue to be Holders after such record date. Such consent shall be effective
only for actions taken within 120 days after such record date.
After an amendment, supplement or waiver becomes effective, it shall
bind every Holder, unless it makes a change described in any of clauses (a)
through (j) of Section 9.02; if it makes such a change, the amendment, sup-
plement or waiver shall bind every subsequent Holder of a Note or portion of a
Note that evidences the same debt as the consenting Holder's Note.
Section 9.05. Notation on or Exchange of Notes. If an amendment,
supplement or waiver changes the terms of a Note, the Trustee shall (in
accordance with the specific direction of the Company) request the Holder of the
Note to deliver it to the Trustee. The Trustee shall (in accordance with the
specific direction of the Company) place an appropriate notation on the Note
about the changed terms and return it to the Holder. Alternatively, if the
Company or the Trustee so determines, the Company in exchange for the Note shall
issue and the Trustee shall authenticate a new Note that reflects the changed
terms. Failure to make the appropriate notation or issue a new Note shall not
affect the validity and effect of such amendment, supplement or waiver.
Section 9.06. Trustee May Sign Amendments, etc. The Trustee shall
sign any amendment, supplement or waiver authorized pursuant to this Article
Nine if the amendment, supplement or waiver does not adversely affect the
rights, duties, liabilities or immunities of the Trustee. If it does, the
Trustee may, but need not, sign it. In signing or refusing to sign such
amendment, supplement or waiver, the Trustee shall be entitled to receive
indemnity reasonably
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satisfactory to it and to receive, and shall be fully protected in relying upon,
an Officers' Certificate and an Opinion of Counsel, each stating that the
execution of any amendment, supplement or waiver is authorized or permitted by
this Indenture, that it is not inconsistent herewith and that it will be valid
and binding upon the Company in accordance with its terms.
ARTICLE TEN
GUARANTEE OF NOTES
Section 10.01. Note Guarantee. Subject to the provisions of this
Article Ten, Holding hereby absolutely, unconditionally and irrevocably
guarantees to each Holder of a Note authenticated and delivered by the Trustee
and to the Trustee and its successors and assigns, as a primary obliger and not
merely as a surety, that: (a) the principal of, premium, if any, and interest on
the Notes shall be duly and punctually paid in full when due, whether at
maturity, by acceleration, by redemption or otherwise, and interest on the
overdue principal and (to the extent permitted by law) interest, if any, on the
Notes and all other obligations of the Company to the Holders or the Trustee
hereunder or thereunder (including fees and expenses, including reasonable
attorneys' fees and expenses) and all other Senior Subordinated Note Obligations
shall be promptly paid in full or performed, all in accordance with the terms
hereof and thereof; and (b) in case of any extension of time of payment or
renewal of any Notes or any of such other Senior Subordinated Note Obligations,
the same shall be promptly paid in full when due or performed in accordance with
the terms of the extension or renewal, whether at Stated Maturity, by
acceleration, by redemption or otherwise. Failing payment when due of any amount
so guaranteed, or failing performance of any other obligation of the Company to
the Holders, for whatever reason, Holding shall be obligated to pay, or to
perform or cause the performance of, the same immediately. This Note Guarantee
shall be a continuing guarantee of payment, performance and compliance when due
(and not a guarantee of collection) in respect of all Senior Subordinated Note
Obligations and shall remain in full force and effect until the payment in full
of all Senior Subordinated Note Obligations. An Event of Default under this
Indenture or the Notes shall constitute an event of default under this Note
Guarantee, and shall entitle the Holders of Notes to accelerate the
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obligations of Holding hereunder in the same manner and to the same extent as
the obligations of the Company.
Holding hereby agrees that its obligations hereunder shall be
absolute and unconditional, irrespective of the validity, regularity or
enforceability of the Notes or this Indenture, any extension or renewal of this
Indenture or the Notes, the absence of any action to enforce the same, any
waiver or consent by any Holder of the Notes with respect to any provisions
hereof or thereof, any release of any other Note Guarantor, the recovery of any
judgment against the Company, any action to enforce the same, whether or not a
Note Guarantee is affixed to any particular Note, or any other circumstance
which might otherwise constitute a legal or equitable discharge or defense of a
guarantor. Holding hereby waives the benefit of diligence, presentment, demand
of payment, filing of claims with a court in the event of insolvency or
bankruptcy of the Company, any right to require a proceeding first against the
Company, protest, notice and all demands whatsoever and covenants that its Note
Guarantee will not be discharged except by complete performance of the
obligations contained in the Notes, this Indenture and this Note Guarantee. If
any Holder or the Trustee is required by any court or otherwise to return to the
Company or to Holding, or any custodian, trustee, liquidator or other similar
official acting in relation to the Company or Holding, any amount paid by the
Company or Holding to the Trustee or such Holder, this Note Guarantee, to the
extent theretofore discharged, shall be reinstated in full force and effect.
Holding further agrees that, as between it, on the one hand, and the Holders of
Notes and the Trustee, on the other hand, (a) subject to this Article Ten, the
maturity of the obligations guaranteed hereby may be accelerated as provided in
Article Six hereof for the purposes of this Note Guarantee, notwithstanding any
stay, injunction or other prohibition preventing such acceleration in respect of
the obligations guaranteed hereby, and (b) in the event of any acceleration of
such obligations as provided in Article Six hereof, such obligations (whether or
not due and payable) shall forthwith become due and payable by Holding for the
purpose of this Note Guarantee.
This Note Guarantee shall remain in full force and effect and
continue to be effective should any petition be filed by or against the Company
for liquidation or reorganization, should the Company become insolvent or make
an assignment for the benefit of creditors or should a receiver or trustee be
appointed for all or any significant part of
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the Company's assets, and shall, to the fullest extent permitted by law,
continue to be effective or be reinstated, as the case may be, if at any time
payment and performance of the Notes are, pursuant to applicable law, rescinded
or reduced in amount, or must otherwise be restored or returned by any obligee
on the Notes, whether as a "voidable preference," "fraudulent transfer" or
otherwise, all as though such payment or performance had not been made. In the
event that any payment, or any part thereof, is rescinded, reduced, restored or
returned, the Notes shall, to the fullest extent permitted by law, be reinstated
and deemed reduced only by such amount paid and not so rescinded, reduced,
restored or returned.
Any term or provision of this Indenture to the contrary
notwithstanding, the maximum aggregate amount of the obligations guaranteed
hereunder by any Note Guarantor shall not exceed the maximum amount that can be
hereby guaranteed without rendering this Indenture, as it relates to any Note
Guarantor, voidable under applicable law relating to fraudulent conveyance or
fraudulent transfer or similar laws affecting the rights of creditors generally.
Section 10.02. Execution and Delivery by Holding of Note Guarantee.
To further evidence the Note Guarantee set forth in Section 10.01, Holding
hereby agrees that a notation of such Note Guarantee, substantially in the form
included in the form of Note included in Exhibit A hereto, shall be endorsed on
each Note authenticated and delivered by the Trustee after such Note Guarantee
is executed and executed by either manual or facsimile signature of an Officer
of Holding. The validity and enforceability of any Note Guarantee shall not be
affected by the fact that it is not affixed to any particular Note.
Holding hereby agrees that its Note Guarantee set forth in Section
10.01 shall remain in full force and effect notwithstanding any failure to
endorse on each Note a notation of such Note Guarantee.
If an Officer of Holding whose signature is on this Indenture or a
Note no longer holds that office at the time the Trustee authenticates such Note
or at any time thereafter, Holding's Note Guarantee of such Note shall be valid
nevertheless.
The delivery of any Note by the Trustee, after the authentication
thereof hereunder, shall constitute due
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delivery of the Note Guarantee set forth in this Indenture on behalf of Holding.
Section 10.03. Additional Note Guarantors. Each Restricted
Subsidiary that is required to become a Note Guarantor pursuant to Section 4.12
or 4.13, and each Restricted Subsidiary that the Company causes to become a Note
Guarantor pursuant to Section 4.13 or Section 4.17, shall promptly (a) execute
and deliver to the Trustee a supplemental indenture in form and substance
reasonably satisfactory to the Trustee, which shall subject such Restricted
Subsidiary to the provisions of this Indenture as a Note Guarantor on
substantially the same terms as set forth in this Article Ten with respect to
the Note Guarantee of Holding, and (b) the Company shall deliver to the Trustee
an Opinion of Counsel in form and substance reasonably satisfactory to the
Trustee stating that such supplemental indenture has been duly authorized,
executed and delivered by such Restricted Subsidiary and that, subject to the
applicable bankruptcy, insolvency, fraudulent transfer, fraudulent conveyance,
reorganization, moratorium and other laws now or hereafter in effect affecting
creditors' rights generally and the general principles of equity (including,
without limitation, standards of materiality, good faith, fair dealing and
reasonableness), such supplemental indenture is a valid and binding agreement of
such Restricted Subsidiary, enforceable against such Restricted Subsidiary in
accordance with its terms.
Section 10.04. Note Guarantee Obligations Subordinated to Guarantor
Senior Indebtedness. Holding covenants and agrees, and each Holder of a Note, by
its acceptance thereof, likewise covenants and agrees, that all payments
pursuant to the Note Guarantee made by or on behalf of Holding are hereby
expressly made subordinate and, subject, in right of payment as provided in this
Article Ten, to the prior payment in full in cash or cash equivalents of all
amounts payable under all existing and future Guarantor Senior Indebtedness of
Holding.
This Section 10.04 and the following Sections 10.05 through 10.17 of
this Article Ten shall constitute a continuing offer to all Persons who, in
reliance upon such provisions, become holders of, or continue to hold Guarantor
Senior Indebtedness of Holding and, to the extent set forth in Section 10.06(b),
holders of Designated Senior Indebtedness; and such provisions are made for the
benefit of the holders of Guarantor Senior Indebtedness of Holding and, to the
extent set forth in Section 10.06(b), holders of
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Designated Senior Indebtedness; and such holders (to such extent) are made
obligees hereunder and they or each of them may enforce such provisions.
Section 10.05. Payment Over of Proceeds upon Dissolution, etc. In
the event of (a) any insolvency or bankruptcy case or proceeding, or any
receivership, liquidation, reorganization or other similar case or proceeding in
connection therewith, relating to Holding or its assets, or (b) any liquidation,
dissolution or other winding-up of Holding, whether voluntary or involuntary, or
(c) any assignment for the benefit of creditors or other marshalling of assets
or liabilities of Holding, then and in any such event:
(1) the holders of all Guarantor Senior Indebtedness of Holding
shall be entitled to receive payment in full in cash or cash equivalents,
or provision acceptable to the requisite holders of Guarantor Senior
Indebtedness of Holding made for such payment, of all amounts due on or in
respect of all such Guarantor Senior Indebtedness before the Holders are
entitled to receive any payment or distribution, whether in cash, property
or securities (excluding Permitted Junior Securities) on account of the
Senior Subordinated Note Obligations or for the acquisition of any of the
Notes; and
(2) any payment or distribution of assets of Holding of any kind or
character, whether in cash, property or securities (excluding Permitted
Junior Securities), by set-off or otherwise, to which the Holders or the
Trustee would be entitled but for the subordination provisions of this
Article Ten shall be paid by the liquidating trustee or agent or other
Person making such payment or distribution, whether a trustee in
bankruptcy, a receiver or liquidating trustee or otherwise, directly to
the holders of Guarantor Senior Indebtedness of Holding or their
representative or representatives or to the trustee or trustees under any
indenture under which any instruments evidencing any of such Guarantor
Senior Indebtedness may have been issued, ratably according to the
aggregate amounts remaining unpaid on account of such Guarantor Senior
Indebtedness held or represented by each, to the extent necessary to make
payment in full in cash or cash equivalents of all such Guarantor Senior
Indebtedness remaining unpaid, after giving
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effect to any concurrent payment or distribution to the holders of such
Guarantor Senior Indebtedness; and
(3) in the event that, notwithstanding the foregoing provisions of
this Section 10.05, the Trustee or the Holder of any Note shall have
received any payment or distribution of assets of Holding of any kind or
character, whether in cash, property or securities, in respect of any
Senior Subordinated Note Obligations under this Note Guarantee before all
Guarantor Senior Indebtedness of Holding is paid in full in cash or cash
equivalents or payment thereof provided for, then and in such event such
payment or distribution (excluding Permitted Junior Securities) shall be
paid over or delivered forthwith to the trustee in bankruptcy, receiver,
liquidating trustee, custodian, assignee, agent or other Person making
payment or distribution of assets of Holding for application to the
payment of all such Guarantor Senior Indebtedness remaining unpaid, to the
extent necessary to pay all of such Guarantor Senior Indebtedness in full
in cash or cash equivalents, after giving effect to any concurrent
payment or distribution to or for the holders of such Guarantor Senior
Indebtedness.
The consolidation of Holding with, or the merger of Holding with or
into, another Person or the liquidation or dissolution of Holding following the
conveyance, transfer or lease of its properties and assets substantially as an
entirety to another Person shall not be deemed a dissolution, winding-up,
liquidation, reorganization, assignment for the benefit of creditors or
marshalling of assets and liabilities of Holding for the purposes of this
Article if the Person formed by such consolidation or the surviving entity of
such merger or the Person which acquires by conveyance, transfer or lease such
properties and assets substantially as an entirety, as the case may be, shall,
as a part of such consolidation, merger, conveyance, transfer or lease, assume
the Note Guarantee of Holding.
Section 10.06. Suspension of Note Guarantee Obligations When
Guarantor Senior Indebtedness in Default. (a) Unless Section 10.05 shall be
applicable, after the occurrence of a Payment Default no payment or distribution
of any assets of Holding of any kind or character shall be made by or on behalf
of Holding on account of the Senior Subordinated Note Obligations or on account
of the purchase, redemption, defeasance or other acquisition of the Senior
Subordinated Note Obligations or any of the obligations of
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Holding under this Note Guarantee unless and until such Payment Default shall
have been cured or waived or shall have ceased to exist or the Senior
Indebtedness as to which such Payment Default relates shall have been discharged
or paid in full in cash or cash equivalents, after which, subject to Section
10.05 (if applicable), Holding shall resume making any and all required payments
in respect of its obligations under this Note Guarantee.
(b) Unless Section 10.05 shall be applicable, during any Payment
Blockage Period in respect of the Notes, no payment or distribution of any
assets of Holding of any kind or character shall be made by or on behalf of
Holding on account of the Senior Subordinated Note Obligations or on account of
the purchase, redemption, defeasance or other acquisition of the Senior
Subordinated Note Obligations or on account of any of the other obligations of
Holding under this Note Guarantee, provided that the foregoing prohibition shall
not apply unless such Payment Blockage Period has been instituted under Section
11.03(b) by a Senior Representative acting for holders of Designated Senior
Indebtedness which also constitutes Guarantor Senior Indebtedness. Upon the
termination of any Payment Blockage Period, subject to Section 10.05 (if
applicable), Holding shall resume making any and all required payments in
respect of its obligations under this Note Guarantee.
(c) In the event that, notwithstanding the foregoing, the Trustee
or the Holder of any Note shall have received any payment from Holding
prohibited by the foregoing provisions of this Section 10.06, then and in such
event such payment shall be paid over and delivered forthwith to the Senior
Representative initiating the Payment Blockage Period, in trust for distribution
to the holders of Guarantor Senior Indebtedness of Holding or, if no amounts are
then due in respect of Guarantor Senior Indebtedness of Holding, prompt return
to Holding, or as a court of competent jurisdiction shall direct.
Section 10.07. Release of Note Guarantee. (a) Concurrently with the
payment in full of all Senior Subordinated Note Obligations, then Holding shall
be released from and relieved of its obligations under this Article Ten. Upon
the delivery by the Company to the Trustee of an Officers' Certificate and, if
requested by the Trustee, an Opinion of Counsel stating that the transaction
giving rise to the release of this Note Guarantee was made by the Company in
accordance with the provisions of this Indenture and the Notes, the Trustee
shall execute any
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documents reasonably required in order to evidence the release of Holding from
its obligations under this Note Guarantee. If any of the Senior Subordinated
Note Obligations are revived and reinstated after the termination of this Note
Guarantee, then all of the obligations of Holding under this Note Guarantee
shall be revived and reinstated as if this Note Guarantee had not been
terminated until such time as the Senior Subordinated Note Obligations are paid
in full, and Holding shall enter into an amendment to this Note Guarantee,
reasonably satisfactory to the Trustee, evidencing such revival and
reinstatement.
(b) Any Restricted Subsidiary that becomes a Note Guarantor pursuant
to Section 4.12, 4.13 or 4.17 shall be released from and relieved of its
obligations under its Note Guarantee in accordance with the terms thereof, as
provided in Section 4.12 or 4.13, or upon payment in full of all Senior
Subordinated Note Obligations, subject to the terms thereof which in such
respect shall be substantially the same as set forth in the foregoing paragraph
(a) with respect to the Note Guarantee of Holding.
Section 10.08. Waiver of Subrogation. Holding hereby irrevocably
waives any claim or other rights which it may now or hereafter acquire against
the Company that arise from the existence, payment, performance or enforcement
of Holding's obligations under this Note Guarantee and this Indenture,
including, without limitation, any right of subrogation, reimbursement,
exoneration, indemnification, and any right to participate in any claim or
remedy of any Holder of Notes against the Company, whether or not such claim,
remedy or right arises in equity, or under contract, statute or common law. If
any amount shall be paid to Holding in violation of the preceding sentence and
the Notes shall not have been paid in full, such amount shall have been deemed
to have been paid to Holding for the benefit of, and held in trust for the
benefit of, the Holders of the Notes, and shall, subject to the subordination
provisions of this Article and to Article Eleven, forthwith be paid to the
Trustee for the benefit of such Holders to be credited and applied upon the
Notes, whether matured or unmatured, in accordance with the terms of this
Indenture.
Section 10.09. Provisions Solely to Define Relative Rights. The
subordination provisions of this Article Ten are and are intended solely for the
purpose of defining the relative rights of the Holders of the Notes on the one
hand and the holders of Guarantor Senior Indebtedness of Holding and, to the
extent set forth in Section
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10.06, holders of Designated Senior Indebtedness on the other hand. Nothing
contained in this Article Ten or elsewhere in this Indenture or in the Notes is
intended to or shall (a) impair, as among Holding, its creditors other than
holders of its Guarantor Senior Indebtedness and the Holders of the Notes, the
obligation of Holding, which is absolute and unconditional, to make payments to
the Holders in respect of its obligations under this Note Guarantee as and when
the same shall become due and payable in accordance with their terms; or (b)
affect the relative rights against Holding of the Holders of the Notes and
creditors of Holding other than the holders of the Guarantor Senior Indebtedness
of Holding; or (c) prevent the Trustee or the Holder of any Note from exercising
all remedies otherwise permitted by applicable law upon Default or an Event of
Default under this Indenture, subject to the rights, if any, under the
subordination provisions of this Article Ten of the holders of Guarantor Senior
Indebtedness of Holding hereunder and, to the extent set forth in Section 10.06,
holders of Designated Senior Indebtedness (1) in any case, proceeding,
dissolution, liquidation or other winding-up, assignment for the benefit of
creditors or other marshaling of assets and liabilities of Holding referred to
in Section 10.05, to receive, pursuant to and in accordance with such Section,
cash, property and securities otherwise payable or deliverable to the Trustee
or such Holder, or (2) under the conditions specified in Section 10.06, to
prevent any payment prohibited by such Section or enforce their rights pursuant
to Section 10.06(c).
The failure by Holding to make a payment in respect of its
obligations under this Note Guarantee by reason of any provision of this Article
Ten shall not be construed as preventing the occurrence of a Default or an Event
of Default hereunder.
Section 10.10. Trustee to Effectuate Subordination. Each Holder of a
Note by his acceptance thereof authorizes and directs the Trustee on his behalf
to take such action as may be necessary or appropriate to effectuate the
subordination provided in this Article Ten and appoints the Trustee his
attorney-in-fact for any and all such purposes, including, in the event of any
dissolution, winding-up, liquidation or reorganization of Holding whether in
bankruptcy, insolvency, receivership proceedings, or otherwise, the timely
filing of a claim for the unpaid balance of the indebtedness of Holding owing to
such Holder in the form required in such proceedings and the causing of such
claim to be approved. If the Trustee does
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not file such a claim prior to 30 days before the expiration of the time to file
such a claim, the holders of Guarantor Senior Indebtedness, or any Senior
Representative, may file such a claim on behalf of Holders of the Notes.
Section 10.11. No Waiver of Subordination Provisions. (a) No right
of any present or future holder of any Guarantor Senior Indebtedness or
Designated Senior Indebtedness to enforce subordination as herein provided shall
at any time in any way be prejudiced or impaired by any act or failure to act on
the part of the Company or Holding or by any act or failure to act, in good
faith, by any such holder, or by any non-compliance by the Company or Holding
with the terms, provisions and covenants of this Indenture, regardless of any
knowledge thereof any such holder may have or be otherwise charged with.
(b) Without limiting the generality of subsection (a) of this
Section 10.11, the holders of Guarantor Senior Indebtedness may, at any time and
from time to time, without the consent of or notice to the Trustee or the
Holders of the Notes, without incurring responsibility to the Holders of the
Notes and without impairing or releasing the subordination provided in this
Article Ten or the obligations hereunder of the Holders of the Notes to the
holders of such Guarantor Senior Indebtedness, do any one or more of the
following: (1) change the manner, place or terms of payment or extend the time
of payment of, or renew or alter, such Guarantor Senior Indebtedness or any
Senior Indebtedness as to which such Guarantor Senior Indebtedness relates or
any instrument evidencing the same or any agreement under which such Guarantor
Senior Indebtedness or such Senior Indebtedness is outstanding; (2) sell,
exchange, release or otherwise deal with any property pledged, mortgaged or
otherwise securing such Guarantor Senior Indebtedness or any Senior Indebtedness
as to which such Guarantor Senior Indebtedness relates; (3) release any Person
liable in any manner for the collection or payment of such Guarantor Senior
Indebtedness or any Senior Indebtedness as to which such Guarantor Senior
Indebtedness relates; and (4) exercise or refrain from exercising any rights
against Holding and any other Person; provided that in no event shall any such
actions limit the right of the Holders of the Notes to take any action to
accelerate the maturity of the Notes pursuant to Article Six hereof or to pursue
any rights or remedies hereunder or under applicable laws if the taking of such
action does not otherwise violate the terms of this Indenture.
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Section 10.12. Notice to Trustee. (a) The Company and Holding shall
give prompt written notice to the Trustee of any fact known to Holding which
would prohibit the making of any payment to or by the Trustee in respect of the
Notes. Notwithstanding the subordination provisions of this Article or any other
provision of this Indenture, the Trustee shall not be charged with knowledge of
the existence of any facts which would prohibit the making of any payment to or
by the Trustee in respect of the Notes, unless and until the Trustee shall have
received written notice thereof at its Corporate Trust Office from the Company,
Holding or a holder of its Guarantor Senior Indebtedness or from any
representative, trustee, fiduciary or agent therefor; and, prior to the receipt
of any such written notice, the Trustee, subject to the provisions of this
Section 10.12, shall be entitled in all respects to assume that no such facts
exist; provided that if the Trustee shall not have received the notice provided
for in this Section 10.12 at least two Business Days prior to the date upon
which by the terms hereof any money may become payable for any purpose under
this Indenture (including, without limitation, the payment of the principal of
or interest on any Note), then, anything herein contained to the contrary
notwithstanding but without limiting the rights and remedies of the holders of
such Guarantor Senior Indebtedness or any representative, trustee, fiduciary or
agent thereof, the Trustee shall have full power and authority to receive such
money and to apply the same to the purpose for which such money was received and
shall not be affected by any notice to the contrary which may be received by it
within two Business Days prior to such date; nor shall the Trustee be charged
with knowledge of the curing of any such default or the elimination of the act
or condition preventing any such payment unless and until the Trustee shall have
received an Officers' Certificate to such effect.
(b) Subject to the provisions of Section 7.01, the Trustee shall be
entitled to rely on the delivery to it of a written notice to the Trustee, by a
Person representing himself to be a holder of Guarantor Senior Indebtedness (or
a representative, trustee, fiduciary or agent therefor). In the event that the
Trustee determines in good faith that further evidence is required with respect
to the right of any Person as a holder of Guarantor Senior Indebtedness to
participate in any payment or distribution pursuant to this Article Ten, the
Trustee may request such Person to furnish evidence to the reasonable
satisfaction of the Trustee as to the amount of Guarantor Senior Indebtedness
held by such Person, the extent to which such Person is entitled to
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participate in such payment or distribution and any other facts pertinent to the
rights of such Person under this Article Ten, and if such evidence is not
furnished, the Trustee may defer any payment to such Person pending judicial
determination as to the right of such Person to receive such payment.
Section 10.13. Reliance on Judicial Order or Certificate of
Liquidating Agent Regarding Dissolution, etc. Upon any payment or distribution
of assets of Holding referred to in this Article Ten, the Trustee, subject to
the provisions of Section 7.01, and the Holders shall be entitled to rely upon
any order or decree entered by any court of competent jurisdiction in which such
insolvency, bankruptcy, receivership, liquidation, reorganization, dissolution,
winding-up or similar case or proceeding is pending, or a certificate of the
trustee in bankruptcy, receiver, liquidating trustee, custodian, assignee for
the benefit of creditors, agent or other Person making such payment or
distribution, delivered to the Trustee or to the Holders, for the purpose of
ascertaining the Persons entitled to participate in such payment or
distribution, the holders of Guarantor Senior Indebtedness and other
Indebtedness of Holding, the amount thereof or payable thereon, the amount or
amounts paid or distributed thereon and all other facts pertinent thereto or to
this Article Ten; provided that the foregoing shall apply only if such court has
been fully apprised of the provisions of this Article Ten. The Trustee is not
responsible for determining whether or not the court has been fully apprised of
the provisions of this Article Ten.
Section 10.14. Rights of Trustee as a Holder of Guarantor Senior
Indebtedness; Preservation of Trustee's Rights. The Trustee in its individual
capacity shall be entitled to all the rights set forth in this Article Ten with
respect to any Guarantor Senior Indebtedness which may at any time be held by
the Trustee, to the same extent as any other holder of such Guarantor Senior
Indebtedness, and nothing in this Indenture shall deprive the Trustee of any of
its rights as such holder. Nothing in this Article Ten shall apply to claims of,
or payments to, the Trustee under or pursuant to Section 7.08.
Section 10.15. Article Ten Applicable to Paying Agents. In case at
any time any Paying Agent other than the Trustee shall have been appointed by
the Company and be then acting hereunder, the term "Trustee" as used in this
Article Ten shall in such case (unless the context otherwise
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requires) be construed as extending to and including such Paying Agent within
its meaning as fully for all intents and purposes as if such Paying Agent were
named in this Article Ten in addition to or in place of the Trustee; provided
that Section 10.14 shall not apply to the Company or any Affiliate of the
Company if it or such Affiliate acts as Paying Agent.
Section 10.16. No Suspension of Remedies. Nothing contained in this
Article Ten shall limit the right of the Trustee or the Holders of Notes to take
any action to accelerate the maturity of the Notes pursuant to Article Six or to
pursue any rights or remedies hereunder or under applicable law, subject to the
rights, if any, under this Article Ten of the holders, from time to time, of
Guarantor Senior Indebtedness.
Section 10.17. Trustee's Relation to Guarantor Senior Indebtedness.
With respect to the holders of Guarantor Senior Indebtedness, the Trustee
undertakes to perform or to observe only such of its covenants and obligations
as are specifically set forth in this Article Ten (and in Article Eleven with
respect to Senior Indebtedness), and no implied covenants or obligations with
respect to the holders of Guarantor Senior Indebtedness shall be read into this
Indenture against the Trustee. The Trustee shall not be deemed to owe any
fiduciary duty to the holders of Guarantor Senior Indebtedness and the Trustee
shall not be liable to any holder of Guarantor Senior Indebtedness if it shall
mistakenly in the absence of gross negligence or willful misconduct pay over or
deliver to Holders, Holding or any other Person moneys or assets to which any
holder of Guarantor Senior Indebtedness shall be entitled by virtue of this
Article Ten or otherwise.
Section 10.18. Subrogation. Upon the payment in full in cash or cash
equivalents of all amounts payable under or in respect of Guarantor Senior
Indebtedness, the Holders shall be subrogated to the rights of the holders of
such Guarantor Senior Indebtedness to receive payments or distributions of
assets of Holding made on such Guarantor Senior Indebtedness until all amounts
due under this Note Guarantee shall be paid in full; and for the purposes of
such subrogation, no payments or distributions to holders of such Guarantor
Senior Indebtedness of any cash, property or securities to which Holders of the
Notes would be entitled except for the provisions of this Article Ten, and no
payment pursuant to the provisions of this Article Ten to holders of such
Guarantor Senior Indebtedness by the
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Holders, shall, as among Holding, its creditors other than holders of such
Guarantor Senior Indebtedness and the Holders, be deemed to be a payment by
Holding to or on account of such Guarantor Senior Indebtedness) it being
understood that the provisions of this Article Ten are solely for the purpose of
defining the relative rights of the holders of such Guarantor Senior
Indebtedness, on the one hand, and the Holders, on the other hand.
If any payment or distribution to which the Holders would otherwise
have been entitled but for the provisions of this Article Ten shall have been
applied, pursuant to the provisions of this Article Ten, to the payment of all
amounts payable under Guarantor Senior Indebtedness, then and in such case, the
Holders shall be entitled to receive from the holders of such Guarantor Senior
Indebtedness at the time outstanding any payments or distributions received by
such holders of Guarantor Senior Indebtedness in excess of the amount sufficient
to pay all amounts payable under or in respect of such Guarantor Senior
Indebtedness in full.
ARTICLE ELEVEN
SUBORDINATION OF NOTES
Section 11.01. Notes Subordinate to Senior Indebtedness. The Company
covenants and agrees, and each Holder of a Note, by his acceptance thereof,
likewise covenants and agrees, that, to the extent and in the manner
hereinafter set forth in this Article Eleven, the Indebtedness represented by
the Notes and the payment of the Senior Subordinated Note Obligations are hereby
expressly made subordinate and subject in right of payment as provided in this
Article to the prior payment in full in cash or cash equivalents of all amounts
payable under all existing and future Senior Indebtedness.
This Article Eleven shall constitute a continuing offer to all
Persons who, in reliance upon such provisions, become holders of, or continue to
hold Senior Indebtedness; and such provisions are made for the benefit of the
holders of Senior Indebtedness; and such holders are made obligees hereunder and
they or each of them may enforce such provisions.
Section 11.02. Payment over of Proceeds upon Dissolution, etc. In
the event of (a) any insolvency or
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bankruptcy case or proceeding, or any receivership, liquidation, reorganization
or other similar case or proceeding in connection therewith, relating to the
Company or to its assets, or (b) any liquidation, dissolution or other
winding-up of the Company, whether voluntary or involuntary, or (c) any
assignment for the benefit of creditors or other marshalling of assets or
liabilities of the Company, then and in any such event:
(1) the holders of Senior Indebtedness shall be entitled to receive
payment in full in cash or cash equivalents or provision acceptable to the
requisite holders of Senior Indebtedness made for such payments, of all
amounts due on or in respect of Senior Indebtedness before the Holders are
entitled to receive any payment or distribution, whether in cash, property
or securities (excluding Permitted Junior Securities) on account of Senior
Subordinated Note Obligations or for the acquisition of any of the Notes;
and
(2) any payment or distribution of assets of the Company of any kind
or character, whether in cash, property or securities (excluding Permitted
Junior Securities), by set-off or otherwise, to which the Holders or the
Trustee would be entitled but for the provisions of this Article shall be
paid by the liquidating trustee or agent or other Person making such
payment or distribution, whether a trustee in bankruptcy, a receiver or
liquidating trustee or otherwise, directly to the holders of Senior
Indebtedness or their representative or representatives or to the trustee
or trustees under any indenture under which any instruments evidencing
any of such Senior Indebtedness may have been issued, ratably according to
the aggregate amounts remaining unpaid on account of the Senior
Indebtedness held or represented by each, to the extent necessary to make
payment in full in cash or cash equivalents of all Senior Indebtedness
remaining unpaid, after giving effect to any concurrent payment or
distribution to the holders of such Senior Indebtedness; and
(3) in the event that, notwithstanding the foregoing provisions of
this Section 11.02, the Trustee or the Holder of any Note shall have
received any payment or distribution of properties or assets of the
Company of any kind or character, whether in cash, property or securities,
by set off or otherwise in respect of any Senior Subordinated Note
Obligations before all Senior
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Indebtedness is paid or provided for in full in cash or cash equivalents,
then and in such event such payment or distribution (excluding Permitted
Junior Securities) shall be paid over or delivered forthwith to the
trustee in bankruptcy, receiver, liquidating trustee, custodian, assignee,
agent or other Person making payment or distribution of assets of the
Company for application to the payment of all Senior Indebtedness
remaining unpaid, to the extent necessary to pay all Senior Indebtedness
in full in cash or cash equivalents, after giving effect to any
concurrent payment or distribution to or for the holders of Senior Indebt-
edness.
The consolidation of the Company with, or the merger of the Company
with or into, another Person or the liquidation or dissolution of the Company
following the conveyance, transfer or lease of its properties and assets
substantially as an entirety to another Person upon the terms and conditions set
forth in Article Five hereof shall not be deemed a dissolution, winding-up,
liquidation, reorganization, assignment for the benefit of creditors or
marshalling of assets and liabilities of the Company for the purposes of this
Article if the Person formed by such consolidation or the surviving entity of
such merger or the Person which acquires by conveyance, transfer or lease such
properties and assets substantially as an entirety, as the case may be, shall,
as a part of such consolidation, merger, conveyance, transfer or lease, comply
with the conditions set forth in such Article Five.
Section 11.03. Suspension of Payment When Senior Indebtedness in
Default. (a) Unless Section 11.02 shall be applicable, upon the occurrence of a
Payment Default, no direct or indirect payment or distribution of any assets of
the Company of any kind or character shall be made by or on behalf of the
Company on account of the Senior Subordinated Note Obligations or on account of
the purchase or redemption or other acquisition of any Senior Subordinated Note
Obligations unless and until such Payment Default shall have been cured or
waived or shall have ceased to exist or such Senior Indebtedness shall have been
discharged or paid in full in cash in cash equivalents, after which, subject to
Section 11.02 (if applicable), the Company shall resume making any and all
required payments in respect of the Notes and the other Senior Subordinated Note
Obligations, including any missed payments.
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(b) Unless Section 11.02 shall be applicable, upon (1) the
occurrence of a Non-payment Default and (2) receipt by the Trustee and the
Company from a Senior Representative of written notice of such occurrence
stating that such notice is a Payment Blockage Notice pursuant to Section
11.03(b) of this Indenture, no payment or distribution of any assets of the
Company of any kind or character shall be made by or on behalf of the Company on
account of any Senior Subordinated Note Obligations or on account of the
purchase or redemption or other acquisition of Senior Subordinated Note
Obligations for a period ("Payment Blockage Period") commencing on the date of
receipt by the Trustee of such notice unless and until the earlier to occur of
the following events (subject to any blockage of payments that may then be in
effect under Section 11.02 or subsection (a) of this Section 11.03): (i) 179
days shall have elapsed since receipt of such notice, (ii) the date on which
such Non-payment Default is cured or waived or ceases to exist (provided that no
other Payment Default or Non-payment Default has occurred or is then continuing
after giving effect to such cure or waiver), (iii) the date on which such
Designated Senior Indebtedness is discharged or paid in full in cash or cash
equivalents or (iv) the date on which such Payment Blockage Period shall have
been terminated by express written notice to the Company or the Trustee from the
Senior Representative initiating such Payment Blockage Period, after which,
subject to Section 11.02 (if applicable), the Company shall promptly resume
making any and all required payments in respect of the Senior Subordinated Note
Obligations, including any missed payments. Notwithstanding any other provision
of this Indenture, only one Payment Blockage Period, whether with respect to the
Notes, any Note Guarantee or the Notes and the Note Guarantees collectively, may
be commenced within any 360 consecutive day period. No Non-payment Default with
respect to Designated Senior Indebtedness that existed or was continuing on the
date of the commencement of any Payment Blockage Period with respect to the
Designated Senior Indebtedness initiating such Payment Blockage Period (other
than any such Non-payment Default which was not and could not reasonably be
expected to have been known by the holders or the Senior Representative) will
be, or can be, made the basis for the commencement of a second Payment Blockage
Period, whether or not within a period of 360 consecutive days, unless such
default has been cured or waived for a period of not less than 90 consecutive
days (it being acknowledged that any subsequent action, or any breach of any
financial covenant for a period commencing after the date of commencement of
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such Payment Blockage Period, that, in either case, would give rise to a
Non-payment Default pursuant to any provision under which a Non-payment Default
previously existed or was continuing shall constitute a new Non-payment Default
for this purpose; provided that, in the case of a breach of a particular
financial covenant, the Company shall have been in compliance for at least one
full period commencing after the date of commencement of such Payment Blockage
Period). In no event shall a Payment Blockage Period extend beyond 179 days from
the date of the receipt by the Trustee of the notice referred to in clause (2)
hereof and there must be a 181 consecutive day period in any 360 day period
during which no Payment Blockage Period is in effect pursuant to this Section
11.03(b).
(c) In the event that, notwithstanding the foregoing, the Trustee
or the Holder of any Note shall have received any payment or distribution
prohibited by the foregoing provisions of this Section 11.03, then and in such
event such payment or distribution shall be paid over and delivered forthwith to
the Senior Representatives or as a court of competent jurisdiction shall direct
for application to the payment of any due and unpaid Senior Indebtedness, to the
extent necessary to pay all such due and unpaid Senior Indebtedness in cash or
cash equivalents, after giving effect to any concurrent payment to or for the
holders of Senior Indebtedness.
Section 11.04. Trustee's Relation to Senior Indebtedness. With
respect to the holders of Senior Indebtedness, the Trustee undertakes to
perform or to observe only such of its covenants and obligations as are
specifically set forth in this Article Eleven (and in Article Ten with respect
to any Guarantor Senior Indebtedness), and no implied covenants or obligations
with respect to the holders of Senior Indebtedness shall be read into this
Indenture against the Trustee. The Trustee shall not be deemed to owe any
fiduciary duty to the holders of Senior Indebtedness and the Trustee shall not
be liable to any holder of Senior Indebtedness if it shall mistakenly pay over
or deliver to Holders, the Company, any Note Guarantor or any other Person
moneys or assets to which any holder of Senior Indebtedness shall be entitled by
virtue of this Article Eleven or otherwise.
Section 11.05. Subrogation to Rights of Holders of Senior
Indebtedness. Upon the payment in full in cash or cash equivalents of all Senior
Indebtedness, the Holders of the Notes shall be subrogated to the rights of the
holders
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of such Senior Indebtedness to receive payments and distributions of cash,
property and securities applicable to the Senior Indebtedness until the
principal of, premium, if any, and interest on the Notes shall be paid in full
in cash or cash equivalents. For purposes of such subrogation, no payments or
distributions to the holders of Senior Indebtedness of any cash, property or
securities to which the Holders of the Notes or the Trustee would be entitled
except for the provisions of this Article, and no payments over pursuant to the
provisions of this Article to the holders of Senior Indebtedness by Holders of
the Notes or the Trustee shall, as among the Company, its creditors other than
holders of Senior Indebtedness, and the Holders of the Notes, be deemed to be a
payment or distribution by the Company to or on account of the Senior
Indebtedness.
If any payment or distribution to which the Holders would otherwise
have been entitled but for the provisions of this Article Eleven shall have been
applied, pursuant to the provisions of this Article Eleven, to the payment of
all amounts payable under the Senior Indebtedness of the Company, then and in
such case the Holders shall be entitled to receive from the holders of such
Senior Indebtedness at the time outstanding any payments or distributions
received by such holders of such Senior Indebtedness in excess of the amount
sufficient to pay all amounts payable under or in respect of such Senior
Indebtedness in full in cash or cash equivalents.
Section 11.06. Provisions Solely to Define Relative Rights. The
provisions of this Article Eleven are and are intended solely for the purpose of
defining the relative rights of the Holders of the Notes on the one hand and the
holders of Senior Indebtedness on the other hand. Nothing contained in this
Article Eleven or elsewhere in this Indenture or in the Notes is intended to or
shall (a) impair, as among the Company, its creditors other than holders of
Senior Indebtedness and the Holders of the Notes, the obligation of the
Company, which is absolute and unconditional, to pay to the Holders of the Notes
the principal of, premium, if any, and interest on the Notes as and when the
same shall become due and payable in accordance with their terms; or (b) affect
the relative rights against the Company of the Holders of the Notes and
creditors of the Company other than the holders of Senior Indebtedness; or (c)
prevent the Trustee or the Holder of any Note from exercising all remedies
otherwise permitted by applicable law upon a Default or an Event of Default
under this Indenture, subject to the rights, if any, under this Article Eleven
of the holders of
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Senior Indebtedness (1) in any case, proceeding, dissolution, liquidation or
other winding up, assignment for the benefit of creditors or other marshalling
of assets and liabilities of the Company referred to in Section 11.02, to
receive, pursuant to and in accordance with such Section, cash, property and
securities otherwise payable or deliverable to the Trustee or such Holder, or
(2) under the conditions specified in Section 11.03, to prevent any payment
prohibited by such Section or enforce their rights pursuant to Section 11.03(c).
The failure to make a payment on account of any Senior Subordinated
Note Obligations by reason of any provision of this Article Eleven shall not be
construed as preventing the occurrence of a Default or an Event of Default
hereunder.
Section 11.07. Trustee to Effectuate Subordination. Each Holder of
a Note by his acceptance thereof authorizes and directs the Trustee on his
behalf to take such action as may be necessary or appropriate to effectuate the
subordination provided in this Article Eleven and appoints the Trustee his
attorney-in-fact for any and all such purposes, including, in the event of any
dissolution, winding-up, liquidation or reorganization of the Company whether in
bankruptcy, insolvency, receivership proceedings, or otherwise, the timely
filing of a claim for the unpaid balance of the Indebtedness of the Company
owing to such Holder in the form required in such proceedings and the causing of
such claim to be approved. If the Trustee does not file such a claim prior to 30
days before the expiration of the time to file such a claim, the holders of
Senior Indebtedness, or any Senior Representative, may file such a claim on
behalf of Holders of the Notes.
Section 11.08. No Waiver of Subordination Provisions. (a) No right
of any present or future holder of any Senior Indebtedness to enforce
subordination as herein provided shall at any time in any way be prejudiced or
impaired by any act or failure to act on the part of the Company or by any act
or failure to act, in good faith, by any such holder, or by any non-compliance
by the Company with the terms, provisions and covenants of this Indenture,
regardless of any knowledge thereof any such holder may have or be otherwise
charged with.
(b) Without limiting the generality of subsection (a) of this
Section 11.08, the holders of Senior Indebtedness may, at any time and from
time to time, without the
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consent of or notice to the Trustee or the Holders of the Notes, without
incurring responsibility to the Holders of the Notes and without impairing or
releasing the subordination provided in this Article Eleven or the obligations
hereunder of the Holders of the Notes to the holders of Senior Indebtedness, do
any one or more of the following: (1) change the manner, place or terms of
payment or extend the time of payment of, or renew or alter, Senior Indebt-
edness or any instrument evidencing the same or any agreement under which
Senior Indebtedness is outstanding; (2) sell, exchange, release or otherwise
deal with any property pledged, mortgaged or otherwise securing Senior
Indebtedness; (3) release any Person liable in any manner for the collection or
payment of Senior Indebtedness; and (4) exercise or refrain from exercising any
rights against the Company and any other Person; provided that in no event shall
any such actions limit the right of the Holders of the Notes to take any action
to accelerate the maturity of the Notes pursuant to Article Six hereof or to
pursue any rights or remedies hereunder or under applicable laws if the taking
of such action does not otherwise violate the terms of this Indenture.
Section 11.09. Notice to Trustee. (a) The Company shall give prompt
written notice to the Trustee of any fact known to the Company which would
prohibit the making of any payment to or by the Trustee in respect of the Notes.
Notwithstanding the provisions of this Article Eleven or any other provision of
this Indenture, the Trustee shall not be charged with knowledge of the existence
of any facts which would prohibit the making of any payment to or by the Trustee
in respect of the Notes, unless and until the Trustee shall have received
written notice thereof from the Company or a holder of Senior Indebtedness or
from any trustee, fiduciary or agent therefor; and, prior to the receipt of any
such written notice, the Trustee, subject to the provisions of this Section
11.09, shall be entitled in all respects to assume that no such facts exist;
provided that if the Trustee shall not have received the notice provided for in
this Section 11.09 at least two Business Days prior to the date upon which by
the terms hereof any money may become payable for any purpose under this Inden-
ture (including, without limitation, the payment of the principal of, premium,
if any, or interest on any Note), then, anything herein contained to the
contrary notwithstanding but without limiting the rights and remedies of the
holders of Senior Indebtedness or any trustee, fiduciary or agent thereof, the
Trustee shall have full power and authority to receive such money and to apply
the
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same to the purpose for which such money was received and shall not be affected
by any notice to the contrary which may be received by it within two Business
Days prior to such date; nor shall the Trustee be charged with knowledge of the
curing of any such default or the elimination of the act or condition preventing
any such payment unless and until the Trustee shall have received an Officers'
Certificate to such effect.
(b) Subject to the provisions of Section 7.01, the Trustee shall be
entitled to rely on the delivery to it of a written notice to the Trustee by a
Person representing himself to be a holder of Senior Indebtedness (or a
representative, trustee, fiduciary or agent therefor) to establish that such
notice has been given by a holder of Senior Indebtedness (or a representative,
trustee, fiduciary or agent therefor). In the event that the Trustee determines
in good faith that further evidence is required with respect to the right of any
Person as a holder of Senior Indebtedness to participate in any payment or
distribution pursuant to this Article Eleven, the Trustee may request such
Person to furnish evidence to the reasonable satisfaction of the Trustee as to
the amount of Senior Indebtedness held by such Person, the extent to which such
Person is entitled to participate in such payment or distribution and any other
facts pertinent to the rights of such Person under this Article Eleven, and if
such evidence is not furnished, the Trustee may defer any payment to such Person
pending judicial determination as to the right of such Person to receive such
payment.
Section 11.10. Reliance on Judicial Order or Certificate of
Liquidating Agent. Upon any payment or distribution of assets of the Company
referred to in this Article Eleven, the Trustee, subject to the provisions of
Section 7.01, and the Holders, shall be entitled to rely upon any order or
decree entered by any court of competent jurisdiction in which such insolvency,
bankruptcy, receivership, liquidation, reorganization, dissolution, winding-up
or similar case or proceeding is pending, or a certificate of the trustee in
bankruptcy, receiver, liquidating trustee, custodian, assignee for the benefit
of creditors, agent or other Person making such payment or distribution,
delivered to the Trustee or to the Holders, for the purpose of ascertaining the
Persons entitled to participate in such payment or distribution, the holders of
Senior Indebtedness and other Indebtedness of the Company, the amount thereof or
payable thereon, the amount or amounts paid or distributed thereon and all other
facts pertinent thereto or to this
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Article; provided that the foregoing shall apply only if such court has been
fully apprised of the provisions of this Article Eleven. The Trustee is not
responsible for determining whether or not the court has been fully apprised of
the provisions of this Article Eleven.
Section 11.11. Rights of Trustee as a Holder of Senior Indebtedness;
Preservation of Trustee's Rights. The Trustee in its individual capacity shall
be entitled to all the rights set forth in this Article Eleven with respect to
any Senior Indebtedness which may at any time be held by it, to the same extent
as any other holder of Senior Indebtedness, and nothing in this Indenture shall
deprive the Trustee of any of its rights as such holder. Nothing in this Article
Eleven shall apply to claims of, or payments to, the Trustee under or pursuant
to Section 7.08.
Section 11.12. Article Applicable to Paying Agents. In case at any
time any Paying Agent other than the Trustee shall have been appointed by the
Company and be then acting hereunder, the term "Trustee" as used in this Article
shall in such case (unless the context otherwise requires) be construed as
extending to and including such Paying Agent within its meaning as fully for all
intents and purposes as if such Paying Agent were named in this Article Eleven
in addition to or in place of the Trustee; provided that Section 11.11 shall
not apply to the Company or any Affiliate of the Company if it or such Affiliate
acts as Paying Agent.
Section 11.13. No Suspension of Remedies. Nothing contained in this
Article Eleven shall limit the right of the Trustee or the Holders of Notes to
take any action to accelerate the maturity of the Notes pursuant to Article Six
or to pursue any rights or remedies hereunder or under applicable law, subject
to the rights, if any, under this Article Eleven of the holders, from time to
time, of Senior Indebtedness.
ARTICLE TWELVE
MISCELLANEOUS
Section 12.01. Trust Indenture Act of 1939. This Indenture is
subject to the provisions of the TIA that are required to be a part of this
Indenture, and shall, to the extent applicable, be governed by such provisions.
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If any provision of this Indenture modifies or excludes any
provision of the Trust Indenture Act that may be so modified or excluded, the
latter provision shall be deemed to apply to this Indenture as so modified or
excluded, as the case may be.
Section 12.02. Notices. Any notice or communication shall be
sufficiently given if in writing and delivered in person or mailed by first
class mail, postage prepaid, addressed as follows:
If to the Company or any Note Guarantor to:
Mettler-Toledo, Inc.
Im Langacher
P.O. Box MT-100
CH-8606
Greifensee, Switzerland
Attention: Chief Executive Officer
With a copy to:
Fried, Frank, Harris, Shriver & Jacobson
One New York Plaza
New York, New York 10004
Attention: Timothy E. Peterson
If to the Trustee to:
United States Trust Company of
New York
114 West 47th Street
New York, New York 10036
Attention: Corporate Trust Division
The parties hereto by notice to the other parties may designate
additional or different addresses for subsequent notices or communications.
Any notice or communication mailed, postage prepaid, to a Holder,
including any notice delivered in connection with TIA Section 310(b), TIA
Section 313(c), TIA Section 314(a) and TIA Section 315(b), shall be mailed by
first class mail to such Holder at the address of such Holder as it appears on
the Notes register maintained by the Registrar and shall be sufficiently given
to such Holder if so mailed within the time prescribed. Copies of any such
communication or notice to a Holder shall also be mailed to the Trustee.
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Failure to mail a notice or communication to a Noteholder or any
defect in it shall not affect its sufficiency with respect to other Holders.
Except for a notice to the Trustee, which is deemed given only when received, if
a notice or communication is mailed in the manner provided above, it is duly
given, whether or not the addressee receives it.
Section 12.03. Communication by Holders with Other Holders. Holders
may communicate pursuant to TIA Section 312(b) with other Holders with respect
to their rights under this Indenture or the Notes. The Company, the Trustee, the
Registrar and any other Person shall have the protection of TIA Section 312(c).
Section 12.04. Certificate and Opinion as to Conditions Precedent.
Upon any request or application by the Company to the Trustee to take or refrain
from taking any action under this Indenture, the Company shall furnish to the
Trustee:
(1) an Officers' Certificate in form and substance reasonably
satisfactory to the Trustee stating that, in the opinion of the signers,
all conditions precedent, if any, provided for in this Indenture relating
to the proposed action have been complied with; and
(2) an Opinion of Counsel in form and substance satisfactory to the
Trustee stating that, in the opinion of such counsel, all such conditions
precedent have been complied with.
Section 12.05. Statements Required in Certificate or Opinion. Each
certificate or opinion with respect to compliance with a condition or covenant
provided for in this Indenture shall include:
(1) a statement that the Person making such certificate or opinion
has read such covenant or condition;
(2) a brief statement as to the nature and scope of the examination
or investigation upon which the statements or opinions contained in such
certificate or opinion are based;
(3) a statement that, in the opinion of such Person, he has made
such examination or investigation
129
<PAGE>
as is reasonably necessary to enable him to express an informed opinion as
to whether or not such covenant or condition has been complied with; and
(4) a statement as to whether or not, in the opinion of such Person,
such condition or covenant has been complied with; provided that with
respect to matters of fact an Opinion of Counsel may rely on an Officers'
Certificate or certificates of public officials.
Section 12.06. Rules by Trustee, Paying Agent, Registrar. The
Trustee may make reasonable rules for action by or at a meeting of Noteholders.
The Paying Agent or Registrar may make reasonable rules for its functions.
Section 12.07. Legal Holiday. "Legal Holiday" is a Saturday, a
Sunday or a day on which banking institutions are not required to be open in the
State of New York. If a payment date is a Legal Holiday, payment shall be made
on the next succeeding day that is not a Legal Holiday, and no interest shall
accrue for the intervening period. If a regular record date is a Legal Holiday,
the record date shall not be affected.
Section 12.08. Governing Law. THIS INDENTURE AND THE NOTES SHALL BE
GOVERNED BY THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO THE PRINCIPLES
OF CONFLICTS OF LAW THEREOF.
Section 12.09. No Recourse Against Others. No director, officer,
employee, incorporator or stockholder, as such, of the Company, Holding, any
Note Guarantor or any Subsidiary of the foregoing shall have any liability for
any obligations of the Company under the Notes or this Indenture or of a Note
Guarantor under any Note Guarantee or for any claim based on, in respect of or
by reason of, such obligations or their creation. Each Holder by accepting a
Note waives and releases all such liability.
Section 12.10. Successors. All agreements of the Company and Holding
in this Indenture, the Notes and the Note Guarantee of Holding shall bind their
successors. All agreements of the Trustee in this Indenture shall bind its
successors.
Section 12.11. Multiple Originals. The parties may sign any number
of copies of this Indenture. Each signed copy shall be an original, but all such
executed
130
<PAGE>
copies together represent the same agreement. One signed copy is enough to prove
this Indenture.
Section 12.12. Separability. In case any provision in this
Indenture, the Notes or any Note Guarantee shall be invalid, illegal or
unenforceable, the validity, legality and enforceability of the remaining
provisions shall not in any way be affected or impaired thereby.
Section 12.13. Table of Contents, Headings, etc. The table of
contents, cross-reference table and headings of the Articles and Sections of
this Indenture have been inserted for convenience of reference only, are not to
be considered a part hereof, and shall in no way modify or restrict any of the
terms or provisions hereof.
Section 12.14. Benefits of Indenture. Nothing in this Indenture or
in the Notes, express or implied, shall give to any Person, other than the
parties hereto and their successors hereunder, and the Holders, any benefit or
any legal or equitable right, remedy or claim under this Indenture except to
holders of Senior Indebtedness and Guarantor Senior Indebtedness.
131
<PAGE>
This Indenture may be signed in any number of counterparts with the
same effect as if the signatures to each counterpart were upon a single
instrument, and all such counterparts together shall be deemed an original of
this Indenture.
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to
be duly executed as of the day and year first above written.
MT ACQUISITION CORP.
By: /s/ Robert Spoerry
-------------------------------
Name: Robert Spoerry
Title: President and Cheif
Executive Officer
METTLER-TOLEDO HOLDING INC.
By: /s/ Robert Spoerry
--------------------------------
Name: Robert Spoerry
Title: President and Cheif
Executive Officer
UNITED STATES TRUST COMPANY
OF NEW YORK, as Trustee
By: /s/ Patricia Sterner
--------------------------------
Name: Patricia Sterner
Title: Assistant Vice President
132
<PAGE>
SCHEDULE 1
Existing Liens
Various equipment and automobile liens filed against Mettler-Toledo S.A.
(France)
<PAGE>
SCHEDULE 2
Existing Indebtedness
US$-Equivalent
Indebtedness
Company Bank Currency Outstanding
------- ---- -------- -------------
Mettler-Toledo A/S Skandinaviska ENS SEK $1,308,000
Mettler-Toledo S.A.E. Banco BBV ESP 874,000
Mettler-Toledo S.p.A. Popodare di Milano ITL 490,000
Mettler-Toledo S.p.A. Popodare di Lecco ITL 126,000
Mettler-Toledo S.p.A. Ricevulez Bancarie ITL 670,000
Mettler-Toledo (S.E.A.)
Pte. Ltd. DBS Bank SGD 417,000
Mettler-Toledo (S.E.A.)
Pte. Ltd. Standard Chartered SGD 47,000
Mettler-Toledo
(Thailand) Ltd. Bangkok Bank THB 307,000
Changzhou Toledo
Electronic Scale Ltd Communication Bank CNY 311,000
Changzhou Toledo
Electronic Scale Ltd Bank of China CNY 2,262,000
----------
Total $6,812,000
==========
<PAGE>
EXHIBIT A
[Form of Face of Note]
[INCLUDE IF NOTE IS A GLOBAL NOTE DEPOSITED WITH THE DEPOSITORY --
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), NEW YORK, NEW YORK, TO
THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND
ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER
NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS
MADE TO CEDE & CO., OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
TRANSFERS OF THIS GLOBAL NOTE SHALL BE LIMITED TO TRANSFERS IN
WHOLE, BUT NOT IN PART, TO NOMINEES OF DTC OR TO A SUCCESSOR THEREOF OR SUCH
SUCCESSOR'S NOMINEE AND LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE
RESTRICTIONS SET FORTH IN THE INDENTURE REFERRED TO ON THE REVERSE HEREOF.]
MT ACQUISITION CORP.
(to be assumed by METTLER-TOLEDO, INC.)
9 3/4% Senior Subordinated Note due 2006
CUSIP No. 592685AA9
No. $
MT ACQUISITION CORP., a corporation incorporated under the laws of
the State of Delaware (herein called the "Company," which term includes any
successor corporation under the Indenture hereinafter referred to), for value
received, hereby promises to pay to or registered assigns, the principal sum of
$___ on October 1, 2006, at the office or agency of the Company referred to
below, and to pay interest thereon on April 1 and October 1, in each year,
commencing on April 1, 1997, accruing from October 15, 1996 or from the most
recent Interest Payment Date to which interest has been paid or duly provided
for, at the rate of 9 3/4% per annum, until the principal hereof is paid or duly
provided for. Interest shall be computed on the basis of a 360-day year
comprised of twelve 30-day months.
The interest so payable, and punctually paid or duly provided for,
on any Interest Payment Date will, as provided in the Indenture referred to on
the reverse hereof, be paid to the Person in whose name this Note (or one or
more Predecessor Notes) is registered at the close of business on the Regular
Record Date for such interest,
A-1
<PAGE>
which shall be March 15 or September 15 (whether or not a Business Day), as the
case may be, next preceding such Interest Payment Date (each a "Regular Record
Date"). Any such interest not so punctually paid, or duly provided for, and
interest on such defaulted interest at the rate borne by the Notes, to the
extent lawful, shall forthwith cease to be payable to the Holder on such Regular
Record Date, and may be paid to the Person in whose name this Note (or one or
more Predecessor Notes) is registered at the close of business on a special
record date for the payment of such defaulted interest to be fixed by the
Trustee, notice of which shall be given to Holders of Notes not less than 10
days prior to such special record date, or may be paid at any time in any other
lawful manner not inconsistent with the requirements of any securities exchange
on which the Notes may be listed, and upon such notice as may be required by
such exchange, all as more fully provided in the Indenture.
Payment of the principal of, premium, if any, and interest on this
Note will be made at the office or agency of the Company maintained for that
purpose in the Borough of Manhattan in The City of New York, or at such other
office or agency of the Company as may be maintained for such purpose, in such
coin or currency of the United States of America as at the time of payment is
legal tender for payment of public and private debts; provided that payment of
interest may be made at the option of the Company by check mailed to the address
of the Person entitled thereto as such address shall appear on the Note register
maintained by the Registrar, subject to Section 2.14 of the Indenture.
Reference is hereby made to the further provisions of this Note set
forth on the reverse hereof.
Unless the certificate of authentication hereon has been duly
executed by the Trustee referred to on the reverse hereof by manual signature,
and a seal has been affixed hereon, this Note shall not be entitled to any
benefit under the Indenture, or be valid or obligatory for any purpose.
A-2
<PAGE>
IN WITNESS WHEREOF, the Company has caused this instrument to be
duly executed under its corporate seal.
Dated: October __, 1996
MT ACQUISITION CORP.
By:_____________________________________
Name:
Title:
[SEAL]
By:_____________________________________
Name:
Title:
A-3
<PAGE>
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Notes referred to in the within-mentioned
Indenture.
UNITED STATES TRUST COMPANY
OF NEW YORK, as Trustee
By:_________________________________________
Authorized Signatory
Date of Authentication:
A-4
<PAGE>
[Form of Reverse of Note]
1. Indenture. This Note is one of a duly authorized issue of Notes
of the Company designated as its 9 3/4% Senior Subordinated Notes due 2006,
limited (except as otherwise provided in the Indenture referred to below) in
aggregate principal amount to $135,000,000, which may be issued under an
indenture (herein called the "Indenture") dated as of October 15, 1996, between
MT Acquisition Corp., a Delaware corporation, as issuer (together with its
successors, the "Company"), Mettler-Toledo Holding Inc., a Delaware corporation,
as a Note Guarantor and United States Trust Company of New York, as trustee (the
"Trustee," which term includes any successor Trustee under the Indenture), to
which Indenture and all indentures supplemental thereto reference is hereby made
for a statement of the respective rights, limitations of rights, duties,
obligations and immunities thereunder of the Company, any Note Guarantor, the
Trustee and the Holders of the Notes, and of the terms upon which the Notes are,
and are to be, authenticated and delivered.
All terms used in this Note which are defined in the Indenture and
not otherwise defined herein shall have the meanings assigned to them in the
Indenture.
No reference herein to the Indenture and no provisions of this Note
or of the Indenture shall alter or impair the absolute or unconditional
obligation of the Company and any Note Guarantor to pay the principal of,
premium, if any and interest on this Note at the times, place, and rate, and in
the coin or currency, herein prescribed.
2. Note Guarantees. This Note is entitled to a certain senior
subordinated Note Guarantee made for the benefit of the Holders. Reference is
hereby made to Article Ten of the Indenture for terms relating to the Note
Guarantee.
3. Subordination. The Indebtedness evidenced by the Notes is, to the
extent and in the manner provided in the Indenture, subordinate and subject in
right of payment to the prior payment in full in cash or cash equivalents of all
Senior Indebtedness and Guarantor Senior Indebtedness, as defined in the
Indenture, and this Note is issued subject to such provisions. Each Holder of
this Note, by accepting the same, (a) agrees to and shall be bound by such
provisions, (b) authorizes and directs the Trustee, on behalf of such Holder, to
take such action as may be necessary or appropriate to effectuate the
subordination as provided in the Indenture and (c) appoints the Trustee
attorney-in-fact of such Holder for such purpose; provided that the Indebtedness
evidenced by this Note shall cease to
A-5
<PAGE>
be so subordinate and subject in right of payment upon any defeasance of this
Note referred to in Paragraph 7 below.
4. Redemption.
(a) Optional Redemption. The Notes are subject to redemption, at the
option of the Company, as a whole or in part, in principal amounts of $1,000 or
any integral multiple of $1,000, at any time on or after October 1, 2001 upon
not less than 30 nor more than 60 days' prior notice at the following Redemption
Prices (expressed as percentages of the principal amount) if redeemed during the
12-month period beginning on October 1 of the years indicated below:
Redemption
Year Price
--------------------------- --------------
2001.................................... 104.875%
2002.................................... 103.250%
2003.................................... 101.625%
2004 and thereafter..................... 100.000%
plus accrued and unpaid interest, if any, to the Redemption Date, all as
provided in the Indenture.
(b) Optional Redemption Upon Public Equity Offering. In addition, at
any time and from time to time on or prior to December 1, 1999, the Company may
redeem in the aggregate up to $47,250,000 of the original principal amount of
the Notes with the proceeds of one or more Public Equity Offerings, in each case
which yields gross proceeds to the Company (before discounts, commissions and
expenses) of at least $65,000,000 and following which there is a Public Market,
at a redemption price equal to 109% of the principal amount thereof plus accrued
and unpaid interest, if any, to the Redemption Date; provided that not less than
$87,750,000 in aggregate principal amount of Notes must remain outstanding
following such redemption. In order to effect the foregoing redemption with the
proceeds of a Public Equity Offering, the redemption must be made within 60 days
of the date of the consummation of any such Public Equity Offering.
(c) Interest Payments. In the case of any redemption of Notes,
interest installments whose Stated Maturity is on or prior to the Redemption
Date will be payable to the Holders of such Notes, or one or more Predecessor
Notes, of record at the close of business on the relevant Record Date referred
to on the face hereof. Notes (or portions thereof) for whose redemption and
payment provision is made
A-6
<PAGE>
in accordance with the Indenture shall cease to bear interest from and after the
Redemption Date.
(d) Partial Redemption. In the event of redemption of this Note in
part only, a new Note or Notes for the unredeemed portion hereof shall be issued
in the name of the Holder hereof upon the cancellation hereof.
5. Offers to Purchase. Sections 4.18 and 4.19 of the Indenture
provide that following any Asset Sale and, upon the occurrence of a Change of
Control, and subject to further limitations contained therein, the Company shall
make an offer to purchase certain amounts of the Notes in accordance with the
procedures set forth in the Indenture.
6. Defaults and Remedies. If an Event of Default shall occur and be
continuing, the principal of all of the outstanding Notes, plus all accrued and
unpaid interest, if any, to and including the date the Notes are paid, may be
declared due and payable in the manner and with the effect provided in the
Indenture.
7. Defeasance. The Indenture contains provisions (which provisions
apply to this Note) for defeasance at any time of (a) the entire indebtedness on
this Note and (b) certain restrictive covenants and related Defaults and Events
of Default, in each case upon compliance by the Company with certain conditions
set forth therein.
8. Amendments and Waivers. The Indenture permits, with certain
exceptions as therein provided, the amendment thereof and the modification of
the rights and obligations of the Company and the rights of the Holders under
the Indenture at any time by the Company, any Note Guarantor and the Trustee
with the consent of the Holders of not less than a majority in aggregate
principal amount of the Notes at the time outstanding. The Indenture also
contains provisions permitting the Holders of specified percentages in aggregate
principal amount of the Notes at the time outstanding, on behalf of the Holders
of all the Notes, to waive compliance by the Company and any Note Guarantor with
certain provisions of the Indenture and certain past Defaults under the
Indenture and this Note and their consequences. Any such consent or waiver by or
on behalf of the Holder of this Note shall be conclusive and binding upon such
Holder and upon all future Holders of this Note and of any Note issued upon the
registration of transfer hereof or in exchange herefor or in lieu hereof whether
or not notation of such consent or waiver is made upon this Note.
9. Denominations, Transfer and Exchange. The Notes are issuable only
in registered form without coupons in denominations of $1,000 and any integral
multiple thereof. As provided in the Indenture and subject to certain
limitations therein set forth, the
A-7
<PAGE>
Notes are exchangeable for a like aggregate principal amount of Notes of a
different authorized denomination, as requested by the Holder surrendering the
same.
As provided in the Indenture and subject to certain limitations
therein set forth, the transfer of this Note is registrable on the Note register
of the Company, upon surrender of this Note for registration of transfer at the
office or agency of the Company maintained for such purpose in the Borough of
Manhattan in The City of New York or at such other office or agency of the
Company as may be maintained for such purpose, duly endorsed by, or accompanied
by a written instrument of transfer in form satisfactory to the Company and the
Registrar duly executed by, the Holder hereof or his attorney duly authorized in
writing, and thereupon one or more new Notes, of authorized denominations and
for the same aggregate principal amount, will be issued to the designated
transferee or transferees.
No service charge shall be made for any registration of transfer or
exchange or redemption of Notes, but the Company may require payment of a sum
sufficient to cover any tax or other governmental charge payable in connection
therewith.
10. Persons Deemed Owners. Prior to and at the time of due
presentment of this Note for registration of transfer, the Company, the Trustee
and any agent of the Company or the Trustee may treat the Person in whose name
this Note is registered as the owner hereof for all purposes, whether or not
this Note shall be overdue, and neither the Company, the Trustee nor any agent
shall be affected by notice to the contrary.
11. Governing Law. THIS NOTE SHALL BE GOVERNED BY THE LAWS OF THE
STATE OF NEW YORK, WITHOUT REGARD TO THE PRINCIPLES OF CON FLICTS OF LAW
THEREOF.
12. Selection and Notice. In the event that less than all of the
Notes are to be redeemed at any time, selection of such Notes for redemption
will be made by the Trustee in compliance with the requirements of the principal
national securities exchange, if any, on which the Notes are listed or, if the
Notes are not then listed on a national securities exchange, on a pro rata
basis, by lot or by such method as the Trustee shall deem fair and appropriate;
provided that no Notes of an original principal amount of $1,000 or less shall
be redeemed in part. Notice of redemption shall be mailed by first-class mail at
least 30 but not more than 60 days before the redemption date to each Holder of
Notes to be redeemed at its registered address. If any Note is to be redeemed in
part only, the notice of redemption that relates to such Note shall state the
portion of the principal amount thereof to be redeemed. A new Note in a
principal amount equal to the
A-8
<PAGE>
unredeemed portion thereof will be issued in the name of the Holder thereof upon
surrender for cancellation of the original Note. On and after the redemption
date, interest will cease to accrue on Notes or portions thereof called for
redemption and accepted for payment.
13. Abbreviations. The following abbreviations, when used in the
inscription on the face of this Note, shall be construed as though they were
written out in full according to applicable laws or regulations:
TEN COM -- as tenants in common
TEN ENT -- as tenants by the entireties
JT TEN -- as joint tenants with right of survivorship and
not as tenants in common
UNIF GIFT
MIN ACT -- ___________Custodian___________
(Cust) (Minor)
under Uniform Gifts to Minors
Act_____________________
(State)
Additional abbreviations may also be used though not in the above list.
A-9
<PAGE>
NOTE GUARANTEE
For value received, the undersigned hereby absolutely,
unconditionally and irrevocably guarantees, as a primary obligor and not merely
as a surety, to the Holder of this Note the payments of principal of, premium,
if any, and interest on this Note and the payment or performance of all other
obligations of the Company under the Indenture and this Note, all in accordance
with and subject to the terms of this Note and Article Ten of the Indenture.
This Note Guarantee is subject to release upon the terms set forth in the
Indenture.
METTLER-TOLEDO HOLDING INC.
By:_________________________________________
Name:
Title:
[SEAL]
A-10
<PAGE>
OPTION OF HOLDER TO ELECT PURCHASE
If you wish to have this Note purchased by the Company pursuant to
Section 4.18 or 4.19 of the Indenture, check the appropriate box:
Section 4.18 [ ]
Section 4.19 [ ]
If you wish to have a portion of this Note purchased by the Company
pursuant to Section 4.18 or 4.19 of the Indenture, state the amount:
$______________
Date: _________________ Your Signature:_________________________________________
(Sign exactly as your name appears on the
other side of this Note)
Signature Guarantee: ______________________
A-11
<PAGE>
ASSIGNMENT FORM
If you the Holder want to assign this Note, fill in the form below and have your
signature guaranteed:
I or we assign and transfer this Note to
________________________________________________________________________________
(Insert assignee's social security or tax ID number)____________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(Print or type assignee's name, address and zip code) and irrevocably appoint
________________________________________________________________________________
agent to transfer this Note on the books of the Company. The agent may
substitute another to act for him.
Date: _________________ Your Signature:_________________________________________
(Sign exactly as your name appears on the
other side of this Note)
Signature Guarantee: ______________________
A-12
<PAGE>
EXHIBIT B
FORM OF FIRST SUPPLEMENTAL INDENTURE
FIRST SUPPLEMENTAL INDENTURE, dated as of October 15, 1996 (this
"Supplemental Indenture"), among METTLER-TOLEDO, INC., a corporation
incorporated under the laws of the State of Delaware (together with its
successors, the "Company"), METTLER-TOLEDO HOLDING INC., a corporation
incorporated under the laws of the State of Delaware (the "Note Guarantor"), and
UNITED STATES TRUST COMPANY OF NEW YORK, as trustee under the indenture referred
to below (the "Trustee").
WITNESSETH:
WHEREAS the corporation formerly named MT Acquisition Corp. ("MT
Acquisition"), the Note Guarantor and the Trustee have heretofore executed and
delivered an indenture, dated as of the date hereof (as amended, the
"Indenture"), providing for the issuance of an aggregate principal amount of
$135,000,000 of 9 3/4% Senior Subordinated Notes due 2006 of the Company (the
"Notes");
WHEREAS immediately after the execution of the Indenture and the
issuance of the Notes, MT Acquisition was merged with and into the Company in
the Merger, with the Company as the surviving corporation; and
WHEREAS, pursuant to Sections 5.01 and 9.01 of the Indenture, the
Company, the Note Guarantor and the Trustee are authorized to execute and
deliver this Supplemental Indenture;
NOW, THEREFORE, each party hereto agrees as follows for the benefit
of each other party and for the equal and ratable benefit of the Holders of the
Notes as follows:
1. Definitions. Capitalized terms used herein without definition
shall have the meanings assigned to them in the Indenture. For all purposes of
this Supplemental Indenture, except as otherwise expressly provided or unless
the context otherwise requires: (i) the terms and expressions used herein shall
have the same meanings as corresponding terms and expressions used in the
Indenture; and (ii) the words "herein", "hereof" and "hereunder" and other words
of similar import refer to this Supplemental Indenture as a whole and not to any
particular section or other subdivision hereof.
2. Express Assumption. The Company hereby acknowledges and agrees
that as a result of it being the surviving corporation in the Merger with MT
Acquisition it has succeeded to all the obligations of MT Acquisition under the
Notes and the Indenture. The Company hereby expressly assumes all the
obligations of MT Acquisition under the Notes and the Indenture.
B-1
<PAGE>
3. Ratification of Indenture; Supplemental Indenture Part of
Indenture. Except as expressly amended hereby, the Indenture is in all respects
ratified and confirmed and all the terms, conditions and provisions thereof
shall remain in full force and effect. This Supplemental Indenture shall form a
part of the Indenture for all pur poses, and every Holder of Notes heretofore or
hereafter authenticated and delivered shall be bound hereby.
4. Governing Law. THIS SUPPLEMENTAL INDENTURE AND THE NOTES SHALL BE
GOVERNED BY THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO THE PRINCIPLES
OF CONFLICTS OF LAW THEREOF.
5. Trustee Makes No Representation. The Trustee makes no
representation as to the validity or sufficiency of this Supplemental Indenture.
6. Multiple Originals. The parties may sign any number of copies of
this Supplemental Indenture. Each signed copy shall be an original, but all such
executed copies together represent the same agreement. One signed copy is enough
to prove this Indenture.
7. Effect of Headings. The Section headings of this Supplemental
Indenture have been inserted for convenience of reference only, are not to be
considered a part hereof, and shall in no way modify or restrict any of the
terms or provisions thereof.
B-2
<PAGE>
EXHIBIT 4.2
<PAGE>
FIRST SUPPLEMENTAL INDENTURE, dated as of October 15, 1996 (this
"Supplemental Indenture"), among METTLER-TOLEDO, INC., a corporation
incorporated under the laws of the State of Delaware (together with its
successors, the "Company"), METTLER-TOLEDO HOLDING INC., a corporation
incorporated under the laws of the State of Delaware (the "Note Guarantor"), and
UNITED STATES TRUST COMPANY OF NEW YORK, as trustee under the indenture referred
to below (the "Trustee").
WITNESSETH:
WHEREAS the corporation formerly named MT Acquisition Corp. ("MT
Acquisition"), the Note Guarantor and the Trustee have heretofore executed and
delivered an indenture, dated as of the date hereof (as amended, the
"Indenture"), providing for the issuance of an aggregate principal amount of
$135,000,000 of 9 3/4% Senior Subordinated Notes due 2006 of the Company (the
"Notes");
WHEREAS immediately after the execution of the Indenture and the
issuance of the Notes, MT Acquisition was merged with and into the Company in
the Merger, with the Company as the surviving corporation; and
WHEREAS, pursuant to Sections 5.01 and 9.01 of the Indenture, the
Company, the Note Guarantor and the Trustee are authorized to execute and
deliver this Supplemental Indenture;
NOW, THEREFORE, each party hereto agrees as follows for the benefit
of each other party and for the equal and ratable benefit of the Holders of the
Notes as follows:
1. Definitions. Capitalized terms used herein without definition
shall have the meanings assigned to them in the Indenture. For all purposes of
this Supplemental Indenture, except as otherwise expressly provided or unless
the context otherwise requires: (i) the terms and expressions used herein shall
have the same meanings as corresponding terms and expressions used in the
Indenture; and (ii) the words "herein", "hereof" and "hereunder" and other words
of similar import refer to this Supplemental Indenture as a whole and not to any
particular section or other subdivision hereof.
<PAGE>
2. Express Assumption. The Company hereby acknowledges and agrees
that as a result of it being the surviving corporation in the Merger with MT
Acquisition it has succeeded to all the obligations of MT Acquisition under the
Notes and the Indenture. The Company hereby expressly assumes all the
obligations of MT Acquisition under the Notes and the Indenture.
3. Ratification of Indenture; Supplemental Indenture Part of
Indenture. Except as expressly amended hereby, the Indenture is in all respects
ratified and confirmed and all the terms, conditions and provisions thereof
shall remain in full force and effect. This Supplemental Indenture shall form a
part of the Indenture for all purposes, and every Holder of Notes heretofore or
hereafter authenticated and delivered shall be bound hereby.
4. Governing Law. THIS SUPPLEMENTAL INDENTURE AND THE NOTES SHALL BE
GOVERNED BY THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO THE PRINCIPLES
OF CONFLICTS OF LAW THEREOF.
5. Trustee Makes No Representation. The Trustee makes no
representation as to the validity or sufficiency of this Supplemental Indenture.
6. Multiple Originals. The parties may sign any number of copies of
this Supplemental Indenture. Each signed copy shall be an original, but all such
executed copies together represent the same agreement. One signed copy is enough
to prove this Indenture.
7. Effect of Headings. The Section headings of this Supplemental
Indenture have been inserted for convenience of reference only, are not to be
considered a part hereof, and shall in no way modify or restrict any of the
terms or provisions thereof.
2
<PAGE>
This Supplemental Indenture may be signed in any number of
counterparts with the same effect as if the signatures to each counterpart were
upon a single instrument, and all such counterparts together shall be deemed an
original of this Supplemental Indenture.
IN WITNESS WHEREOF, the parties hereto have caused this Supplemental
Indenture to be duly executed as of the day and year first above written.
METTLER-TOLEDO, INC.
By: /s/ Fred Ort
------------------------------
Name: Fred Ort
Title: Head, Finance & Control
METTLER-TOLEDO HOLDING INC.
By: /s/ Fred Ort
------------------------------
Name: Fred Ort
Title: Head, Finance & Control
UNITED STATES TRUST COMPANY OF
NEW YORK, as Trustee
By: /s/ Patricia Sterner
------------------------------
Name: Patricia Sterner
Title: Assistant President
<PAGE>
EXHIBIT 23.1
<PAGE>
INDEPENDENT AUDITORS' CONSENT
The Board of Directors
Ciba Geigy AG
We consent to the use of our report with respect to Mettler-Toledo Group
included in this Form 8-K.
KPMG FIDES PEAT
October 28, 1996
Zurich, Switzerland
<PAGE>
EXHIBIT 99.1
<PAGE>
================================================================================
CREDIT AGREEMENT
Dated as of October 15, 1996
among
METTLER-TOLEDO HOLDING INC.,
as Guarantor,
MT ACQUISITION CORP.
(to be merged into Mettler-Toledo, Inc.)
and
METTLER-TOLEDO HOLDING AG,
as Borrowers,
THE SUBSIDIARY SWING LINE BORROWERS NAMED HEREIN,
MERRILL LYNCH & CO.,
as Arranger and Documentation Agent,
THE BANK OF NOVA SCOTIA,
as Administrative Agent,
CREDIT SUISSE
and LEHMAN COMMERCIAL PAPER INC.,
as Co-Agents,
and
THE OTHER FINANCIAL INSTITUTIONS PARTY HERETO
================================================================================
<PAGE>
TABLE OF CONTENTS
Section Page
ARTICLE I
DEFINITIONS
1.1 Certain Defined Terms............................................ 2
1.2 Other Interpretive Provisions.................................... 44
1.3 Accounting Principles............................................ 45
1.4 Currency Equivalents Generally................................... 46
1.5 Principle of Deemed Reinvestment................................. 46
ARTICLE II
THE CREDITS
2.1 Amounts and Terms of Commitments................................. 46
2.2 Notes............................................................ 48
2.3 Procedure for Committed Borrowings............................... 48
2.4 Conversion and Continuation Elections for Committed Borrowings... 50
2.5 Utilization of Commitments in Offshore Currencies................ 52
2.6 Reduction or Termination of Commitments.......................... 55
2.7 Prepayments...................................................... 55
2.8 Currency Exchange Fluctuations................................... 60
2.9 Repayment........................................................ 61
2.10 Interest......................................................... 64
2.11 Fees............................................................. 65
(a) Arrangement, Agency Fees................................... 65
(b) Facility Fees.............................................. 66
2.12 Computation of Fees, Interest and Dollar Equivalent
Amount ......................................................... 66
2.13 Payments by the Borrowers and the Subsidiary Swing Line
Borrowers........................................................ 66
2.14 Payments by the Lenders to the Administrative Agent.............. 68
2.15 Adjustments...................................................... 68
2.16 Swing Line Commitment............................................ 69
2.17 Borrowing Procedures for Swing Line Loans........................ 70
2.18 Refunding of Swing Line Loans.................................... 71
2.19 Participations in Swing Line Loans............................... 72
2.20 Swing Line Participation Obligations Unconditional............... 72
2.21 Conditions to Swing Line Loans................................... 73
2.22 Substitution of Lenders in Certain Circumstances................. 73
-i-
<PAGE>
Section Page
2.23 Qualified Foreign Lender Notes................................... 74
ARTICLE III
THE LETTERS OF CREDIT
3.1 The Letter of Credit Subfacility................................. 75
3.2 Issuance, Amendment and Renewal of Letters of Credit............. 76
3.3 Risk Participations, Drawings and Reimbursements................. 79
3.4 Repayment of Participations...................................... 81
3.5 Role of the L/C Lender........................................... 81
3.6 Obligations Absolute............................................. 82
3.7 Cash Collateral Pledge........................................... 83
3.8 Letter of Credit Fees............................................ 83
3.9 Uniform Customs and Practice..................................... 84
3.10 Letters of Credit for the Account of Subsidiaries................ 84
ARTICLE IV
NET PAYMENTS, YIELD PROTECTION AND ILLEGALITY
4.1 Net Payments..................................................... 84
4.2 Illegality....................................................... 88
4.3 Increased Costs and Reduction of Return.......................... 89
4.4 Funding Losses................................................... 90
4.5 Inability to Determine Rates..................................... 91
4.6 Reserves on LIBOR Rate Committed Loans; MLA Costs................ 92
4.7 Certificates of Lenders.......................................... 92
4.8 Substitution of Lenders.......................................... 93
4.9 Right of Lenders to Fund Through Branches and
Affiliates....................................................... 93
ARTICLE V
CONDITIONS PRECEDENT
5.1 Conditions of Initial Loans...................................... 93
(a) Credit Agreement; Guarantees; Notes........................ 93
(b) Transactions............................................... 94
(c) Transaction Documents...................................... 94
(d) Opinions of Counsel........................................ 94
(e) Corporate Documents........................................ 95
-ii-
<PAGE>
Section Page
(f) Adverse Change, etc........................................ 95
(g) Litigation................................................. 95
(h) Approvals.................................................. 95
(i) Security Documents......................................... 96
(j) Conditions Relating to Mortgaged Real Property
and Real Property............................................ 97
(k) Solvency Opinion; Environmental Analyses; Evidence of
Insurance; Financial Statements......................... 99
(l) Pro Forma Balance Sheet....................................100
(m) Payment of Fees............................................100
(n) Other Matters..............................................100
(o) Certificate................................................100
(p) Debt to Be Repaid..........................................101
(q) Date of Closing............................................101
5.2 Conditions to All Credit Extensions..............................101
(a) Notice, Application........................................101
(b) Continuation of Representations and Warranties.............101
(c) No Existing Default; No Legal Bar .........................101
5.3 Delivery of Documents............................................102
ARTICLE VI
REPRESENTATIONS AND WARRANTIES
6.1 Corporate Status.................................................102
6.2 Authority........................................................103
6.3 No Conflicts; Consents...........................................103
6.4 Binding Effect...................................................103
6.5 Litigation.......................................................103
6.6 No Default.......................................................104
6.7 Benefit Plans....................................................104
6.8 Use of Proceeds; Margin Regulations..............................105
6.9 Financial Condition; Financial Statements;
Solvency; etc....................................................105
6.10 Properties.......................................................106
6.11 Taxes............................................................106
6.12 Environmental Matters............................................107
6.13 Regulated Entities...............................................109
6.14 Employee and Labor Matters.......................................109
6.15 Intellectual Property............................................110
6.16 Subsidiaries.....................................................110
6.17 Existing Indebtedness............................................110
-iii-
<PAGE>
Section Page
6.18 True and Complete Disclosure.....................................110
6.19 Security Interests...............................................111
6.20 Representations and Warranties in Basic Documents................111
6.21 M-T Acquisition..................................................112
6.22 Broker's Fees....................................................112
6.23 Senior Subordinated Notes........................................112
6.24 Assignment of Rights under M-T Acquisition Documents.............113
ARTICLE VII
AFFIRMATIVE COVENANTS
7.1 Financial Statements, etc........................................113
7.2 Certificates; Other Information..................................114
7.3 Notices..........................................................115
7.4 Preservation of Corporate Existence, etc.........................116
7.5 Maintenance of Property; Insurance...............................117
7.6 Payment of Obligations...........................................117
7.7 Compliance with Environmental Laws...............................117
7.8 Compliance with ERISA............................................118
7.9 Inspection of Property and Books and Records.....................118
7.10 End of Fiscal Years; Fiscal Quarters.............................119
7.11 Use of Proceeds..................................................119
7.12 Further Assurances...............................................119
7.13 Equal Security for Loans and Notes; No Further Negative Pledges..120
7.14 Pledge of Additional Collateral..................................120
7.15 Security Interests...............................................121
7.16 Interest Rate Protection.........................................122
7.17 Currency and Commodity Hedging Transactions......................122
7.18 Foreign Subsidiaries Security....................................122
7.19 Register.........................................................123
7.20 New Subsidiaries.................................................124
7.21 Assumption by Mettler-Toledo, Inc................................124
7.22 Post-Closing Obligations.........................................125
ARTICLE VIII
NEGATIVE COVENANTS
8.1 Limitation on Liens..............................................126
8.2 Consolidations, Mergers and Disposition of Assets................129
8.3 Leases...........................................................132
-iv-
<PAGE>
Section Page
8.4 Loans and Investments............................................132
8.5 Limitation on Indebtedness.......................................136
8.6 Transactions with Affiliates.....................................138
8.7 Use of Proceeds..................................................139
8.8 Contingent Obligations...........................................140
8.9 Restrictions on Subsidiaries.....................................141
8.10 Fixed Charge Coverage Ratio......................................142
8.11 Minimum Net Worth................................................142
8.12 Debt to EBITDA Ratio.............................................143
8.13 Restricted Payments..............................................144
8.14 ERISA............................................................145
8.15 Change in Business...............................................145
8.16 Accounting Changes...............................................146
8.17 Prepayments of Senior Subordinated Notes, etc....................146
8.18 Amendments to Other Documents....................................146
8.19 Capital Expenditures.............................................146
8.20 Sale and Lease-Backs.............................................147
8.21 Sale or Discount of Receivables..................................148
8.22 Creation of Subsidiaries.........................................148
8.23 Designated Senior Debt...........................................149
8.24 Issuance or Disposal of Subsidiary Stock.........................149
8.25 Limitation on Other Restrictions on Amendment of Basic Documents.149
ARTICLE IX
EVENTS OF DEFAULT
9.1 Event of Default.................................................149
(a) Non-Payment................................................149
(b) Representation or Warranty.................................150
(c) Specific Defaults..........................................150
(d) Other Defaults.............................................150
(e) Cross-Default..............................................150
(f) Insolvency; Voluntary Proceedings..........................150
(g) Involuntary Proceedings....................................151
(h) ERISA......................................................151
(i) Monetary Judgments.........................................151
(j) Non-Monetary Judgments.....................................151
(k) Guarantees.................................................151
(l) Security Documents.........................................152
(m) Change of Control..........................................152
(n) Senior Subordinated Notes..................................152
-v-
<PAGE>
Section Page
(o) Ciba Reimbursement Agreement...............................152
(p) Consummation of the M-T Acquisition........................152
(q) Environmental Events.......................................152
9.2 Remedies.........................................................152
9.3 Rights Not Exclusive.............................................153
ARTICLE X
THE AGENTS
10.1 Appointment and Authorization....................................154
10.2 Delegation of Duties.............................................155
10.3 Exculpatory Provisions...........................................155
10.4 Reliance by Administrative Agent.................................156
10.5 Notice of Default................................................156
10.6 Credit Decision..................................................156
10.7 Indemnification .................................................157
10.8 Administrative Agent in Individual Capacity......................158
10.9 Successor Administrative Agent...................................158
10.10 Holders..........................................................159
10.11 Failure to Act...................................................159
ARTICLE XI
MISCELLANEOUS
11.1 Amendments and Waivers...........................................159
11.2 Notices..........................................................161
11.3 No Waiver; Cumulative Remedies...................................162
11.4 Expenses, Indemnity, etc.........................................163
11.5 Payments Pro Rata................................................165
11.6 Payments Set Aside...............................................165
11.7 Successors and Assigns...........................................166
11.8 Assignments and Participations, etc..............................166
11.9 Confidentiality..................................................169
11.10 Set-off..........................................................170
11.11 Notification of Addresses, Lending Offices, etc..................170
11.12 Counterparts.....................................................170
11.13 Severability; Modification to Conform to Law.....................170
11.14 No Third Parties Benefited.......................................171
11.15 Governing Law; Submission to Jurisdiction; Venue.................171
11.16 Waiver of Jury Trial.............................................172
11.17 Judgment.........................................................172
-vi-
<PAGE>
Section Page
11.18 Prior Understandings.............................................172
11.19 Survival.........................................................172
11.20 CH Foreign Subsidiary Mortgages..................................173
-vii-
<PAGE>
ANNEXES
Annex A Administrative Agent's Payment Offices for
Offshore Currency Loans
SCHEDULES
Schedule 1.1(a) Ciba Loan Documents
Schedule 1.1(b) Calculation of the MLA Cost
Schedule 1.1(c) Mortgaged Properties
Schedule 1.1(d) M-T Acquisition Documents
Schedule 1.1(e) Non-Guarantor Subsidiaries
Schedule 2.1 Commitments and Pro Rata Shares
Schedule 5.1(p) Debt to Be Repaid
Schedule 6.5 Litigation
Schedule 6.12 Environmental Matters
Schedule 6.15 Intellectual Property
Schedule 6.16 Subsidiaries and Minority Interests
Schedule 6.17 Existing Indebtedness
Schedule 6.21 Certain Consents
Schedule 6.22 Broker's Fees
Schedule 7.22 Subsidiaries to Enter into Loan Documents Post-Closing
Schedule 8.1 Certain Existing Liens
Schedule 8.2(i) Certain Asset Sales
Schedule 8.4(j) Investments Made in Connection with the M-T Acquisition
Schedule 8.4(o) Existing Investments and Investments to Be Made Under Binding
Agreements
Schedule 8.8 Contingent Obligations
Schedule 11.2 Addresses for Notices
EXHIBITS
Exhibit A Form of Notice of Committed Borrowing
Exhibit B Form of Notice of Conversion/Continuation
Exhibit C Form of Compliance Certificate
Exhibit D Form of Security Agreement
Exhibit E-1 Form of CH Borrower Guarantee
Exhibit E-2 Form of Domestic Subsidiary Guarantee
Exhibit E-3 [Intentionally Omitted]
Exhibit E-4 Form of Holding Guarantee
Exhibit E-5 Form of US Borrower Guarantee
Exhibit F-1 Form of Opinion of Fried, Frank, Harris, Shriver & Jacobson
Exhibit F-2 Form of Local Counsel Opinion to the Domestic Loan Parties
-viii-
<PAGE>
Exhibit G Form of Assignment and Acceptance
Exhibit H-1 Form of Tranche A Term Note
Exhibit H-2 Form of Tranche B Term Note
Exhibit H-3 Form of Tranche C(CH) Term Note
Exhibit H-4 Form of Tranche C(US) Term Note
Exhibit H-5 Form of Revolving Note
Exhibit H-6 Form of Swing Line Note
Exhibit H-7 Form of QFL C(US) Note
Exhibit H-8 Form of QFL B Note
Exhibit I Form of Mortgage
Exhibit J-1 Form of Domestic Subsidiary Securities Pledge Agreement
Exhibit J-2 [Intentionally Omitted]
Exhibit J-3 Form of Holding Securities Pledge Agreement
Exhibit J-4 Form of US Borrower Securities Pledge Agreement
Exhibit K Form of Interest Rate Certificate
Exhibit L-1 Form of Section 4.1(f)(i) Certificate
Exhibit L-2 Form of Section 4.1(f)(v) Certificate
Exhibit M Form of Assumption Agreement
Exhibit N Form of Intercreditor Agreement
-ix-
<PAGE>
CREDIT AGREEMENT
This CREDIT AGREEMENT is entered into as of October 15, 1996, among
METTLER-TOLEDO HOLDING INC., a Delaware corporation (together with its
successors, "Holding"), MT ACQUISITION CORP. (to be merged into Mettler-Toledo,
Inc.), a Delaware corporation (together with its successors, "US Borrower"),
METTLER-TOLEDO HOLDING AG, a corporation organized under the laws of Switzerland
and, after giving effect to the M-T Acquisition, a Wholly-Owned Subsidiary of US
Borrower (together with its successors, "CH Borrower" and, together with US
Borrower, the "Borrowers"), the several SUBSIDIARY SWING LINE BORROWERS named
herein, the several financial institutions from time to time party to this
Agreement (collectively the "Lenders"; individually each a "Lender"), MERRILL
LYNCH & CO., as documentation agent and arranger (together with its successors,
the "Documentation Agent" or "Arranger"), THE BANK OF NOVA SCOTIA
("Scotiabank"), as Administrative Agent (together with its successors, the
"Administrative Agent"), a Swing Line Lender and L/C Lender, CREDIT SUISSE, as a
Swing Line Lender and as a co-agent, and LEHMAN COMMERCIAL PAPER INC., as a
co-agent (together with Credit Suisse in its capacity as a co-agent and each of
their respective successors, the "Co-Agents"), as provided herein.
WHEREAS, subject to the terms and conditions of this Agreement, to
finance in part the M-T Acquisition, to repay certain existing Indebtedness of
the Borrowers and their Subsidiaries, to pay fees and expenses in connection
with the Transactions and, after the Closing Date, to provide working capital
to, and for general corporate purposes of, US Borrower and the Subsidiaries and
to provide for the making of the Ciba Loan,
(i) the Lenders have agreed to make the Term Loans to the Borrowers
on the Closing Date; and
(ii) the Lenders have agreed to make available, during the period
from the Closing Date until 30 Business Days prior to the Revolving Loan
Maturity Date, (i) to the Borrowers, a revolving multicurrency credit
facility with letter of credit and swing line subfacilities and (ii) to
the Subsidiary Swing Line Borrowers, the swing line subfacility, and
WHEREAS, immediately following or in connection with the
consummation of the M-T Acquisition the rights and obligations of MT Acquisition
Corp. as "US Borrower" under and pursuant to the Loan Documents will be assumed
(the "Assumption") by Mettler Toledo Inc. pursuant to the Assumption Agreement.
NOW, THEREFORE, in consideration of the mutual agreements,
provisions and covenants contained herein, the parties agree as follows:
<PAGE>
-2-
ARTICLE I.
DEFINITIONS
1.1. Certain Defined Terms. The following terms have the following
meanings:
ABR Loan means a Committed Loan or an L/C Advance that bears
interest based on the Alternate Base Rate. ABR Loans may only be made in U.S.
Dollars.
Acquisition means any transaction or series of related transactions
for the purpose of or resulting, directly or indirectly, in (a) the acquisition
of all or substantially all of the assets of a Person, or of any business or
division of a Person, (b) the acquisition of in excess of 50% of the capital
stock, partnership interests, membership interests or equity of any Person, or
otherwise causing any Person to become a Subsidiary, or (c) a merger or
consolidation or any other combination with another Person.
Additional Collateral -- see Section 7.14.
Adjusted Working Capital means the remainder of: (a) (i) the
consolidated current assets of US Borrower and the Subsidiaries, less (ii) the
amount of cash and Cash Equivalents included in such consolidated current
assets; less (b) (i) consolidated current liabilities of US Borrower and the
Subsidiaries, less (ii) the amount of short-term Indebtedness (including
Revolving Facility Loans and current maturities of long-term Indebtedness) of US
Borrower and the Subsidiaries included in such consolidated current liabilities.
Adjustment Date -- see the definition of Assumed Swing Line Loan
Amount.
Administrative Agent -- see the introduction to this Agreement.
Administrative Agent's Fee Letter -- see subsection 2.11(a).
Administrative Agent's Payment Office means (i) in respect of
payments by the Borrowers in U.S. Dollars, The Bank of Nova Scotia, One Liberty
Plaza, 26th Floor, New York, New York 10006 or such other address as the
Administrative Agent may from time to time specify in accordance with Section
11.2, and (ii) in the case of payments by the Borrowers or M-T Leicester in any
Offshore Currency, as set forth in Annex A or such other address as the
Administrative Agent may from time to time specify in accordance with Section
11.2.
AEA means AEA Investors Inc., a Delaware corporation, and its
successors.
<PAGE>
-3-
Affiliate means, as to any Person, any other Person which, directly
or indirectly, is in control of, is controlled by, or is under common control
with such Person. A Person shall be deemed to control another Person if the
controlling Person possesses, directly or indirectly, the power to direct or
cause the direction of the management and policies of such other Person, whether
through the ownership of voting securities or membership interests, by contract,
or otherwise.
Agents means the Documentation Agent and the Administrative Agent;
and Agent means the Documentation Agent or the Administrative Agent.
Agreed Alternative Currency -- see subsection 2.5(e).
Agreement means this Credit Agreement, as amended and in effect from
time to time.
Aggregate Outstanding Revolving Credit means as to any Revolving
Facility Lender at any time an amount equal to the sum of (a) the aggregate
unpaid principal Dollar Equivalent amount at such time of all Revolving Loans
made by such Revolving Facility Lender, (b) such Revolving Facility Lender's Pro
Rata Share of the Effective Amount of all outstanding L/C Obligations at such
time and (c) such Revolving Facility Lender's Pro Rata Share of the aggregate
Dollar Equivalent amount of all outstanding Swing Line Loans (which for all
purposes, other than any Revolving Loan made pursuant to Section 2.18, shall
include such Lender's Pro Rata Share of the Assumed Swing Line Loan Amount).
Alternate Base Rate means, for any day, with respect to all ABR
Loans, a fluctuating rate of interest per annum (rounded, if necessary, to the
nearest 1/100 of 1%) equal to the higher of: (a) 0.50% per annum above the
latest U.S. Federal Funds Rate; and (b) the per annum rate of interest in effect
for such day as published in The Wall Street Journal (or a comparable
publication if The Wall Street Journal is not then published) as the "Prime
Rate" for major money center banks in the United States.
Amortization Payments means, as to any Term Loan Facility, the
scheduled repayments of the Term Loans of such Term Loan Facility as set forth
in subsections 2.9(a) and (b) and Amortization Payment means any such scheduled
repayment.
Annualized Interest Expense means, for any period of less than four
fiscal quarters, the product of (x) Interest Expense for such period and (y) a
fraction, the numerator of which is 365 and the denominator of which is the
number of days in such period.
<PAGE>
-4-
Applicable Currency means, as to any particular payment or Loan,
U.S. Dollars or the Offshore Currency in which it is denominated or is payable.
Applicable Margin means (A) for Tranche B Term Loans and Tranche C
Term Loans at any time, and for Tranche A Term Loans and Revolving Facility
Loans (including Non-U.S. $ Swing Line Loans) at any time prior to the date upon
which the consolidated financial results of US Borrower and the Subsidiaries for
four full fiscal quarters of US Borrower occurring after the Closing Date (not
including any financial results for the Mettler-Toledo Group prior to the
consummation of the M-T Acquisition) are provided to the Administrative Agent
and the Lenders in accordance with subsection 7.1(b) (the "Reset Date"), the
percentages set forth in the table below:
================================================================================
LIBOR Rate
Type of Loan Loans ABR Loans
================================================================================
Revolving Facility Loans (including
Non-U.S. $ Swing Line Loans) 2.00% 1.00%
- --------------------------------------------------------------------------------
Tranche A Term Loans 2.50% 1.50%
- --------------------------------------------------------------------------------
Tranche B Term Loans 3.00% 2.00%
- --------------------------------------------------------------------------------
Tranche C Term Loans 3.25% 2.25%
================================================================================
(B) for Tranche A Term Loans and Revolving Facility Loans (including
Non-U.S. $ Swing Line Loans), at any time following the Reset Date, the
applicable percentage set forth below opposite the Debt to EBITDA Ratio set
forth below as of the end of the most recent Computation Period:
<PAGE>
-5-
<TABLE>
<CAPTION>
============================================================================================================================
Debt to EBITDA Ratio LIBOR Rate Loans ABR Loans
----------------------------------------------------------------------------------------
Revolving Loans and
Non-U.S. $ Swing
Line Loans Tranche A Term Loans Revolving Loans
=============================================================================================================================
<S> <C> <C> <C>
Greater than 4.25 to 1.0 2.00% 2.50% 1.00%
- -----------------------------------------------------------------------------------------------------------------------------
Greater than 3.75 to 1.0 and
less than or equal to 4.25 to 1.75% 2.25% 0.75%
1.0
- -----------------------------------------------------------------------------------------------------------------------------
Greater than 3.5 to 1.0 and
less than or equal to 3.75 to 1.50% 2.00% 0.50%
1.0
- -----------------------------------------------------------------------------------------------------------------------------
Greater than 3.25 to 1.0 and
less than or equal to 3.5 to 1.25% 1.75% 0.25%
1.0
- -----------------------------------------------------------------------------------------------------------------------------
Less than 3.25 to 1.0 1.00% 1.50% 0%
=============================================================================================================================
</TABLE>
Any change in the Debt to EBITDA Ratio shall be effective to adjust the
Applicable Margin as of the date of receipt by the Administrative Agent of the
Interest Rate Certificate most recently delivered pursuant to subsection 7.2(b).
Applicable Swing Line Lender means, with respect to any Swing Line
Loan, the Swing Line Lender to whom a request for such Loan has been made
hereunder or who has made such Loan.
Arranger -- see the introduction to this Agreement.
Asset Sale shall mean any sale, issuance, conveyance, transfer,
lease or other disposition (including by sale-leaseback, merger, consolidation
or otherwise) by US Borrower or any Subsidiary, in one or a series of related
transactions, of: (a) any capital stock of any Subsidiary; (b) all or
substantially all of the properties and assets of any division or line of
business of US Borrower or any Subsidiary; (c) any payment, liquidation or
realization on any Investment permitted by subsection 8.4(d); or (d) other than
inventory in the ordinary course of business, any properties or assets of US
Borrower or any Subsidiary. For the purposes of this definition, the term "Asset
Sale" shall not include (i) any sale, issuance, conveyance, transfer, lease or
other disposition of properties or assets to either Borrower or any Wholly-Owned
<PAGE>
-6-
Subsidiary of US Borrower which is a Qualified Subsidiary Guarantor, (ii) any
Asset Sale not resulting in total consideration individually of more than the
Dollar Equivalent amount of U.S. $250,000 (calculated only at the time of
consummation thereof), (iii) any sale, issuance, conveyance, transfer, lease or
other disposition of properties or assets of US Borrower or any Subsidiary
permitted by Section 8.2 (other than subsections (d), (i), (j) and (k) thereof),
(iv) Takings or Destructions or loss of title to any Mortgaged Real Property,
(v) any Lien permitted by Section 8.1, (vi) any Investment permitted by Section
8.4 and (vii) any Restricted Payment permitted by Section 8.13.
Assignee -- see subsection 11.8(a).
Assumed Swing Line Loan Amount means the Dollar Equivalent amount of
the aggregate total of the Subsidiary Swing Line Borrower Sublimits of the
Subsidiary Swing Line Borrowers other than M-T Leicester, which amount shall be
adjusted (up or down) after the Closing Date not less frequently than on the
last Business Day of each fiscal quarter of US Borrower occurring after the
Closing Date (each such date, an "Adjustment Date") by the amount by which the
Dollar Equivalent amount as of such date of the Subsidiary Swing Line Borrower
Sublimits of the Subsidiary Swing Line Borrowers other than M-T Leicester is
greater than or less than the Assumed Swing Line Loan Amount as of the
immediately preceding Adjustment Date (or the Closing Date with respect to the
first Adjustment Date occurring after the Closing Date) (and from the most
recent Adjustment Date until the next immediately succeeding Adjustment Date the
Administrative Agent shall assume that the Dollar Equivalent amount of Swing
Line Loans in an amount of such adjusted amount is then outstanding for all
purposes other than any Revolving Loan to be made under Section 2.18 and any
Swing Line Loan to be made under Section 2.16).
Assumption -- see the recitals hereto.
Assumption Agreement means the Assumption Agreement executed and
delivered by a duly authorized officer of Mettler-Toledo, Inc. in connection
with or following the consummation of the M-T Acquisition, substantially in the
form of Exhibit M with such changes thereto as shall be approved by the
Arranger, providing for the Assumption.
Attorney Costs means and includes all reasonable fees and charges of
any law firm or other external counsel.
Available Revolving Facility Commitment means, as to any Revolving
Facility Lender at any time, an amount equal to the excess, if any, of (a) the
amount of such Revolving Facility Lender's Revolving Facility Commitment at such
time, over (b) the sum of (i) the aggregate unpaid principal Dollar Equivalent
amount at such time of all Revolving Loans made
<PAGE>
-7-
by such Revolving Facility Lender, (ii) such Revolving Facility Lender's Pro
Rata Share of the Effective Amount of all outstanding L/C Obligations at such
time and (iii) such Revolving Facility Lender's Pro Rata Share of the aggregate
Dollar Equivalent amount of all outstanding Swing Line Loans (which, for all
purposes other than any Revolving Loan made pursuant to Section 2.18, shall
include such Lender's Pro Rata Share of the Assumed Swing Line Loan Amount).
Average Life means, when applied to any Indebtedness at any date,
the number of years obtained by dividing (a) the then outstanding aggregate
principal amount of such Indebtedness into (b) the total of the product obtained
by multiplying (i) the amount of each then remaining installment, sinking fund,
serial maturity or other required payment of principal, including payment at
final maturity, in respect thereof, by (ii) the number of years (calculated to
the nearest one-twelfth) which will elapse between such date and the making of
such payment.
Bankruptcy Code means the Federal Bankruptcy Reform Act of 1978 (11
U.S.C. ss. 101, et seq.), as amended.
Basic Documents means the Loan Documents, the Transaction Documents
and the Other Documents, collectively and Basic Document means any such
agreement.
Beneficial Owner shall have the meaning assigned thereto in Rule
13d-3 of the SEC under the Exchange Act as in effect on the date hereof.
Benefitted Lender -- see Section 2.15.
Board of Directors means the Board of Directors of any of US
Borrower, Holding and MT Investors, as the case may be, or a designated
committee thereof.
Borrowers -- see the introduction to this Agreement.
Borrowing means a borrowing hereunder consisting of Loans of the
same Facility and Type and in the same Applicable Currency made to a Borrower or
a Subsidiary Swing Line Borrower on the same day by one or more Lenders under
Article II and, other than in the case of ABR Loans or Swing Line Loans made to
any Swing Line Borrower, having the same Interest Period.
Borrowing Date means any date on which a Borrowing occurs under
Section 2.3 or 2.17.
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Business Day means any day other than a Saturday, Sunday or other
day on which commercial banks in London, England, New York, New York or Zurich,
Switzerland or, with respect to any Subsidiary Swing Line Borrower, the
applicable country of its incorporation or organization are authorized or
required by law to close and (i) with respect to disbursements and payments in
U.S. Dollars relating to LIBOR Rate Committed Loans, a day on which dealings are
carried on in the applicable offshore U.S. Dollar interbank market, and (ii)
with respect to disbursements and payments in and calculations pertaining to any
Offshore Currency, a day on which commercial banks are open for foreign exchange
business in London, England, and on which dealings in the relevant Offshore
Currency are carried on in the applicable offshore foreign exchange interbank
market in which disbursement of or payment in such Offshore Currency will be
made or received hereunder.
Capital Adequacy Regulation means, in respect of any Lender, any
guideline, request or directive of any central bank or other Governmental
Authority, or any other law, rule or regulation, whether or not having the force
of law, in each case, regarding capital adequacy of such Lender or of any
corporation controlling such Lender which is generally applicable to banks or
corporations controlling banks in any applicable jurisdiction (and not
applicable to such Lender or the corporation controlling such Lender solely due
to the financial or regulatory condition of such Lender or such corporation).
Capital Expenditures means all expenditures which, in accordance
with GAAP, would be required to be capitalized and shown on the consolidated
balance sheet of US Borrower, but excluding (i) expenditures made in connection
with the replacement, substitution or restoration of assets to the extent
financed (x) from insurance proceeds (or other similar recoveries) paid on
account of the loss of or damage to the assets being replaced or restored or (y)
with awards of compensation arising from the taking by eminent domain,
expropriation or condemnation of the assets being replaced, (ii) the M-T
Acquisition, (iii) any Acquisition effected in accordance with subsection 8.4(f)
and (iv) any Investment (other than pursuant to subsection 8.4(t)) permitted by
Section 8.4.
Capital Lease, as applied to any Person, shall mean any lease of any
property (whether real, personal or mixed) by that Person as lessee which, in
conformity with GAAP, is accounted for as a capital lease on the balance sheet
of that Person.
Cash means money, currency or a credit balance in a deposit account.
Cash Collateralize means to pledge and deposit with or deliver to
the Administrative Agent, for the benefit of the Administrative Agent and the
Revolving Facility Lenders, as collateral for the L/C Obligations, Cash pursuant
to documentation in form and substance reasonably satisfactory to the
Administrative Agent and the L/C Lender (which
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documents are hereby consented to by the Lenders). Derivatives of such term
shall have corresponding meanings. The Borrowers hereby grant to the
Administrative Agent, for the benefit of the Administrative Agent, the L/C
Lender and the Revolving Facility Lenders, a security interest in all such Cash.
Cash collateral shall be maintained in blocked deposit accounts at Scotiabank.
Cash Equivalents means (i) any security, maturing not more than one
year after the date of acquisition, issued by the United States of America or an
instrumentality or agency thereof and guaranteed fully as to principal, premium,
if any, and interest by the United States of America; (ii) any certificate of
deposit, time deposit or bankers' acceptance (or, with respect to non-U.S.
banking institutions, similar instruments), maturing not more than one year
after the day of acquisition, issued by any commercial banking institution that
is a member of the Federal Reserve System or a commercial banking institution
organized and located in a country recognized by the United States of America,
in each case, having combined capital and surplus and undivided profits of not
less than $500 million (or the foreign currency equivalent thereof), whose
short-term debt has a rating, at the time as of which any investment therein is
made, of "P-1" (or higher) according to Moody's or "A-1" (or higher) according
to S&P; (iii) commercial paper maturing not more than one year after the date of
acquisition issued by a corporation (other than an Affiliate or Subsidiary of
either Borrower) with a rating, at the time as of which any investment therein
is made, of "P-1" (or higher) according to Moody's or "A-1" (or higher)
according to S&P; (iv) any money market deposit accounts issued or offered by a
commercial banking institution that is a member of the Federal Reserve System or
a commercial banking institution organized and located in a country recognized
by the United States of America, in each case, having combined capital and
surplus in excess of $500 million (or the foreign currency equivalent thereof);
and (v) other short-term investments utilized by Foreign Subsidiaries in
accordance with normal investment practices for cash management not exceeding a
Dollar Equivalent amount of $5.0 million in aggregate principal amount
outstanding at any time.
Change in Law means the introduction of any Requirement of Law, or
any change in any Requirement of Law or in the interpretation or administration
of any Requirement of Law.
Change of Control means any of the following events: (a) Holding
shall cease to own directly 100% on a fully diluted basis of the economic and
voting interest in US Borrower's capital stock or shall not have the power to
appoint all of the members of the Board of Directors of US Borrower; or (b) US
Borrower shall cease to own directly 100% on a fully diluted basis of the
economic and voting interest in CH Borrower's capital stock or shall not have
the power to appoint all of the members of the Board of Directors of CH
Borrower; or (c) prior to an initial public offering of common stock of MT
Investors or Holding, the Investors
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shall cease to own on a fully diluted basis in the aggregate at least a majority
of the economic or voting interest in MT Investors' or Holding's capital stock,
as the case may be (or in the capital stock of any other Person of which US
Borrower is a Subsidiary), or after such an initial public offering, any
"person" or "group" (as such terms are used in Sections 13(d) and 14(d) of the
Exchange Act), other than the Investors, is or becomes (as a result of the
acquisition or issuance of securities, by merger or otherwise) the Beneficial
Owner, directly or indirectly, on a fully diluted basis of more than 30% of the
economic or voting interest in MT Investors' or Holding's capital stock, as the
case may be (or in the capital stock of any other Person of which US Borrower is
a Subsidiary); (d) after the initial public offering of common stock of MT
Investors or Holding, during any consecutive two-year period, individuals who at
the beginning of such period constituted the Board of Directors of MT Investors
or Holding (or any other parent of U.S. Borrower), as the case may be (together
with any new directors whose election by the shareholders of MT Investors or
Holding (or any other Person of which US Borrower is a Subsidiary), as the case
may be, was approved by a vote of 66-2/3% of the directors then still in office
who were either directors at the beginning of such period or whose election as
directors or nomination for election was previously so approved), cease for any
reason to constitute a majority of the Board of Directors of MT Investors or
Holding (or any other Person of which US Borrower is a Subsidiary), as the case
may be, then in office; or (e) a "Change of Control" or similar event shall
occur as provided in the Senior Subordinated Note Indenture; provided, however,
that the merger of any of US Borrower, Holding and MT Investors with and into
any other of such three Persons shall not, in and of itself, be deemed a Change
of Control so long as the Lenders retain a pledge of 100% of the capital stock
of US Borrower or its successor in interest in such merger.
CH Borrower -- see the introduction to this Agreement.
CH Borrower Guarantee means a guarantee substantially in the form of
Exhibit E-1 entered into and delivered by CH Borrower.
CHF and Swiss Francs mean lawful money of Switzerland.
CHF Equivalent means, at any time, (a) as to any amount denominated
in CHF, the amount thereof at such time, and (b) as to any amount denominated in
any Offshore Currency, the equivalent amount in CHF as determined by Credit
Suisse at such time on the basis of the Spot Rate for the purchase of CHF with
such Offshore Currency on the date as is specified herein.
CH Foreign Subsidiary means each Foreign Subsidiary which is also a
Subsidiary of CH Borrower.
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Chinese Subsidiaries means each of the following Subsidiaries:
Changzhou Toledo Electronic Scale Ltd., Changzhou; Panzhihua Toledo Electronic
Scale Ltd., Panzhihua; Mettler-Toledo Instruments (Shanghai) Ltd., Shanghai;
Mettler-Toledo International Trading (Shanghai) Corp., and Xinjian Toledo
Electronic Scale Ltd., Urumgi, each incorporated in the People's Republic of
China, and their respective successors.
Ciba Loan means the loan made by CH Borrower to AG fur
Prazisioninstrumente, Greifensee, Switzerland, pursuant to the Ciba Loan
Documents in the amount of approximately CHF 37.875 million.
Ciba Loan Documents means the documents set forth on Schedule
1.1(a), as amended and in effect from time to time in accordance with Section
8.18.
Ciba Reimbursement Agreement means the agreement dated as of October
15, 1996 between Ciba-Geigy AG, US Borrower, Holding and Mettler-Toledo, Inc.,
as amended and in effect from time to time in accordance with Section 8.18.
Closing Date means the date on which all conditions precedent set
forth in Section 5.1 are satisfied or waived by all Lenders.
Co-Agents -- see the introduction to this Agreement.
Code means the Internal Revenue Code of 1986, as amended.
Collateral means all of the Security Agreement Collateral, Pledged
Securities and Mortgaged Real Property.
Commitment, as to each Lender, means its Tranche A Facility
Commitment, Tranche B Facility Commitment, Tranche C(CH) Facility Commitment,
Tranche C(US) Facility Commitment, Revolving Facility Commitment or Swing Line
Commitment.
Committed Borrowing means a Borrowing hereunder consisting of
Committed Loans of one Facility made by the Lenders ratably according to their
respective Pro Rata Shares in such Facility.
Committed Loan means a Revolving Loan, a Swing Line Loan or a Term
Loan.
Company means Holding or any of its Subsidiaries.
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Compliance Certificate means a certificate substantially in the form
of Exhibit C and delivered by the Borrowers pursuant to subsection 7.2(a).
Computation Amount - see subsection 3.8(a).
Computation Date means any date on which the Administrative Agent
determines the Dollar Equivalent amount of any Offshore Currency Loans or Swing
Line Loans pursuant to subsection 2.5(a) or 2.8(b).
Computation Period means each period of four full consecutive fiscal
quarters most recently ended and for which financial statements are or are
required to be available. Prior to such time as four full consecutive fiscal
quarters of financial information for US Borrower are available, Computation
Period shall include financial information of the Mettler-Toledo Group to the
extent necessary such that four full fiscal quarters of financial information
form the basis of the Computation Period.
Confidential Memorandum shall mean the Confidential Memorandum,
dated September 1996, and all written supplemental material thereto prepared by,
or on behalf of, the Borrowers and transmitted to the Lenders prior to the
Closing Date.
Consolidated Net Income means, for any period, the consolidated net
income of US Borrower and the Subsidiaries for such period; provided, however,
that there shall be excluded therefrom (i) the income of any Subsidiary to the
extent that the transfer of such income by such Subsidiary to either Borrower or
its direct parent at the time is restricted in any material way by operation of
the terms of its charter or any judgment, decree, order, statute, rule or
governmental regulation applicable to such Subsidiary or any agreement or
instrument which is binding on such Subsidiary, (ii) the income of any Person
which is not a Subsidiary (but any dividends or other distributions received in
cash by either Borrower or any Subsidiary from such Person shall be included in
Consolidated Net Income), (iii) unrealized gains or losses in respect of Swap
Contracts and (iv) unrealized foreign currency transaction gains or losses in
respect of Indebtedness of any Person denominated in a currency other than the
functional currency of such Person and permitted by Section 8.5.
Consolidated Net Worth means at the date of determination thereof,
the sum of (a) all items which in conformity with GAAP would be classified as
stockholders' equity on a consolidated balance sheet of US Borrower at such date
and (b) preferred stock (whether or not so classified as stockholders' equity)
provided that such preferred stock (i) has no mandatory redemptions prior to the
Tranche C Term Loan Maturity Date and (ii) was issued and is outstanding on
terms and conditions reasonably satisfactory to the Administrative Agent;
provided, however, that Consolidated Net Worth shall be calculated without
giving effect to
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(1) any item excluded from the definition of Consolidated Net Income (other than
clauses (i) and (ii) thereof), (2) any write-off of deferred financing costs in
connection with the early extinguishment of Indebtedness hereunder or under the
Senior Subordinated Notes, (3) cumulative currency translation adjustments and
net unrealized investment gains and losses, (4) charges relating to the closure
of the Westerville, Ohio facility and (5) nonrecurring restructuring charges
related to the M-T Acquisition and any nonrecurring restructuring charges
recorded on or prior to December 31, 1998 in an aggregate amount not to exceed
U.S.$20 million.
Contingent Obligation means, as to any Person, any direct or
indirect liability of such Person, whether or not contingent, with or without
recourse, (a) with respect to any Indebtedness, lease, dividend, letter of
credit or other obligation (the "primary obligations") of another Person (the
"primary obligor"), including any obligation of such Person (i) to purchase,
repurchase or otherwise acquire such primary obligations or any security
therefor, (ii) to advance or provide funds for the payment or discharge of any
such primary obligation, or to maintain working capital or equity capital of the
primary obligor or otherwise to maintain the net worth or solvency or any
balance sheet item, level of income or financial condition of the primary
obligor, (iii) to purchase property, securities or services primarily for the
purpose of assuring the owner of any such primary obligation of the ability of
the primary obligor to make payment of such primary obligation, or (iv)
otherwise to assure or hold harmless the holder of any such primary obligation
against loss in respect thereof (each of (i) - (iv), a "Guaranty Obligation");
(b) with respect to any Surety Instrument (other than any Letter of Credit)
issued for the account of such Person or as to which such Person is otherwise
liable for reimbursement of drawings or payments; (c) to purchase any materials,
supplies or other property from, or to obtain the services of, another Person if
the relevant contract or other related document or obligation requires that
payment for such materials, supplies or other property, or for such services,
shall be made regardless of whether delivery of such materials, supplies or
other property is ever made or tendered, or such services are ever performed or
tendered; or (d) in respect of any Swap Contract. The amount of any Contingent
Obligation shall (x) in the case of a Guaranty Obligation, be deemed equal to
the stated or determinable amount of the primary obligation in respect of which
such Guaranty Obligation is made or, if not stated or if indeterminable, the
maximum reasonably anticipated liability in respect thereof, and (y) in the case
of other Contingent Obligations, be equal to the maximum reasonably anticipated
liability in respect thereof.
Contractual Obligation means, as to any Person, any term, covenant,
provision of condition of any security issued by such Person or of any
agreement, undertaking, contract, indenture, mortgage, deed of trust or other
instrument, document or agreement to which such Person is a party or by which it
or any of its property is bound.
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Conversion/Continuation Date means any Business Day on which either
Borrower (i) converts Committed Loans of a Facility from one Type to the other
Type or (ii) continues as Committed Loans of the same Type, but with a new
Interest Period, Committed Loans of a Facility having Interest Periods expiring
on such date.
Covered Taxes means any and all Taxes, other than, in the case of
each Lender or Agent, Taxes of any jurisdiction (or any political subdivision
thereof) imposed on or measured by such Lender's or such Agent's net income or
net profits (including any franchise Taxes imposed thereon and any branch
profits Taxes), that arise by reason of a former, present or future connection
between such Lender or Agent and such jurisdiction (including, without
limitation, a connection arising from such Lender or Agent being or having been
a citizen or resident of such jurisdiction, or having been organized, present or
engaged in a trade or business in such jurisdiction, or having or having had a
permanent establishment or fixed place of business in such jurisdiction, but
excluding a connection arising solely from such Lender or Agent having executed,
delivered, performed its obligations or received a payment under this
Agreement).
Credit Extension means and includes (a) the making of any Loan
hereunder and (b) the Issuance of any Letter of Credit hereunder.
Credit Facilities means the Revolving Facility together with the
Term Loan Facilities.
Current Liabilities means, at any time, all amounts which, in
accordance with GAAP, would be included as current liabilities on a consolidated
balance sheet of US Borrower and the Subsidiaries at such time, excluding
current maturities of Indebtedness.
Debt to Be Repaid means all Indebtedness listed on Schedule 5.1(p).
Debt to EBITDA Ratio means, as of the last day of any fiscal
quarter, the ratio of: (a) the total consolidated Indebtedness of US Borrower
and the Subsidiaries as of such day to (b) EBITDA for the Computation Period
ending on such day.
Defaulting Lender means any Lender with respect to which a Lender
Default is in effect.
Destruction has the meaning assigned to that term in the Mortgages.
Deutschemarks and DM each mean lawful money of Germany.
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Disinterested Director means a member of a Board of Directors who
does not have any material direct or indirect financial interest in or with
respect to the transaction being considered.
Documentation Agent -- see the introduction to this Agreement.
Dollar Equivalent means, at any time, (a) as to any amount
denominated in U.S. Dollars, the amount thereof at such time, and (b) as to any
amount denominated in any Offshore Currency, the equivalent amount in U.S.
Dollars as determined by the Administrative Agent at such time on the basis of
the Spot Rate for the purchase of U.S. Dollars with such Offshore Currency on
the most recent Computation Date provided for in subsection 2.5(a) or such other
date as is specified herein.
Domestic Guarantors means Holding, US Borrower and the Domestic
Subsidiary Guarantors.
Domestic Loan Parties means the Domestic Guarantors.
Domestic Subsidiary means a Subsidiary that is incorporated under
the laws of any State of the United States or Puerto Rico or the District of
Columbia and that is a direct Subsidiary of (i) US Borrower or (ii) another
Domestic Subsidiary.
Domestic Subsidiary Guarantee means a guarantee substantially in the
form of Exhibit E-2 entered into and delivered by a Domestic Subsidiary.
Domestic Subsidiary Guarantor means each Domestic Subsidiary which
executes and delivers a Domestic Subsidiary Guarantee.
Domestic Subsidiary Securities Pledge Agreement means a securities
pledge agreement substantially in the form of Exhibit J-1 entered into and
delivered by a Domestic Subsidiary.
EBITDA means, for any period, the sum of: (a) Consolidated Net
Income of US Borrower and the Subsidiaries for such period excluding, to the
extent reflected in determining such Consolidated Net Income, (i) extraordinary
gains and losses for such period, (ii) any gain or loss associated with the sale
or write-down of assets not in the ordinary course of business, - (iii) any
deferred financing costs for such period written off in connection with the
early extinguishment of Indebtedness hereunder or under the Senior Subordinated
Notes, (iv) any charge for such period relating to the closure of the
Westerville, Ohio facility, (v) any non-recurring charges related to the M-T
Acquisition, any non-recurring charges recorded on or prior
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to December 31, 1998 in an aggregate amount not to exceed $20.0 million and any
non-recurring non-cash charges related to any other Acquisition by US Borrower
or any Subsidiary occurring after the Closing Date, (vi) any expense relating to
bonuses paid by Ciba-Geigy AG or its Affiliates (other than an Affiliate that
will be an Affiliate of US Borrower after the consummation of the M-T
Acquisition) to employees of US Borrower or any Subsidiary pursuant to any
agreements entered into in connection with the disposition of the Mettler-Toledo
Group by Ciba-Geigy AG or assumed by US Borrower or any Subsidiary in
consideration of a reduction in the purchase price for the M-T Acquisition and
(vii) any other non-cash or non-recurring items of income or expense (other than
any non-cash item of expense requiring an accrual or reserve for future cash
expense), plus (b) to the extent deducted in determining Consolidated Net Income
for such period, Interest Expense, income tax and capital tax expense,
depreciation, depletion and amortization expense for such period. Prior to such
time as four full fiscal quarters of financial information of US Borrower after
the Closing Date are available pursuant to this Agreement, EBITDA shall be
calculated by taking into account the results of the Mettler-Toledo Group (in
accordance with this definition) for such number of fiscal quarters (or part
thereof) so that, when added to the financial information of US Borrower, four
full fiscal quarters of financial information form the basis for the calculation
under this definition.
Effective Amount means with respect to any outstanding L/C
Obligations on any date, the aggregate Dollar Equivalent amount of such L/C
Obligations on such date after giving effect to any Issuances of Letters of
Credit occurring on such date and any other changes in the aggregate Dollar
Equivalent amount of the L/C Obligations as of such date, including as a result
of any reimbursement of outstanding unpaid drawings under any Letter of Credit
or any reduction in the maximum amount available for drawing under any Letter of
Credit taking effect on such date.
Eligible Assignee means (i) a commercial bank organized under the
laws of the United States, or any state thereof, and having a combined capital
and surplus of at least U.S. $100.0 million; (ii) a commercial bank organized
under the laws of any other country which is a member of the Organization for
Economic Cooperation and Development (the "OECD"), or a political subdivision of
any such country, and having a combined capital and surplus in a Dollar
Equivalent amount of at least U.S. $100.0 million; provided, however, that such
bank is acting through a branch or agency located in the country in which it is
organized or another country which is also a member of the OECD; (iii) a Person
that is primarily engaged in the business of commercial banking and that is (A)
a Subsidiary of a Lender, (B) a Subsidiary of a Person of which a Lender is a
Subsidiary, or (C) a Person of which a Lender is a Subsidiary; and (iv) an
insurance company, mutual fund or other financial institution organized under
the laws of the United States, any state thereof, any other country which is a
member of the OECD or a political subdivision of any such country with assets
under management in a Dollar Equivalent amount of at least U.S. $100.0 million;
provided, however, that no Person
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shall be an Eligible Assignee in respect of any Tranche A Facility Commitment or
Revolving Loan Commitment unless, at the time of the proposed assignment to such
Person, such Person is able to make Tranche A Loans or Revolving Loans, as the
case may be, in U.S. Dollars and each Offshore Currency.
Environmental Approvals means any material approval, determination,
order, consent, authorization, certificate, license, permit, franchise,
concession or validation of, or exemption or other action by, or filing,
recording or registration with, or notice to, any Governmental Authority
pursuant to or required under any Environmental Law.
Environmental Claims means all claims, however asserted, by any
Governmental Authority or other Person alleging potential liability under, or
responsibility for violation of, any Environmental Law, or for any release or
threatened release of a Hazardous Material or injury to the environment.
Environmental Laws means all applicable federal, state, local and
foreign laws, common law or regulations, treaties, orders, decrees, permits,
licenses, authorizations, judgments or injunctions issued, promulgated, approved
or entered thereunder, now or hereafter in effect in each case relating to
pollution or protection of employee health or safety or the environment
(including, without limitation, ambient and indoor air, surface water,
groundwater, soil, land surface or subsurface) including, without limitation,
laws relating to (a) emissions, discharges, releases or threatened releases of
Hazardous Materials into the environment and (b) the manufacture, processing,
distribution, use, generation, treatment, storage, disposal, transport or
handling of Hazardous Materials.
Equipment has the meaning assigned to that term in the Security
Agreements.
Equity Issuance means the issuance of common equity securities by
Holding directly or indirectly to the Investors for gross proceeds of the Dollar
Equivalent amount of not less than U.S. $190.0 million on or prior to the
Closing Date; provided, however, that up to the Dollar Equivalent amount of U.S.
$7.50 million to be contributed by employees of the Mettler-Toledo Group may be
contributed after the Closing Date, but will be contributed by AEA or its
designee if not so contributed by employees prior to December 31, 1996 (and the
term Equity Issuance shall include such later contributions to the extent made
by December 31, 1996).
ERISA means the Employee Retirement Income Security Act of 1974.
ERISA Affiliate means any trade or business (whether or not
incorporated) under common control with a Loan Party within the meaning of
Section 414(b) or (c) of the Code (and
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Sections 414(m) and (o) of the Code for purposes of provisions relating to
Section 412 of the Code).
ERISA Event means (a) a Reportable Event with respect to a Pension
Plan; (b) the failure to make a required contribution to a Pension Plan if such
failure could give rise to a Lien under Section 302(f) of ERISA; (c) a
withdrawal by a Loan Party or any ERISA Affiliate from a Pension Plan subject to
Section 4063 of ERISA during a plan year in which it was a substantial employer
(as defined in Section 4001(a)(2) of ERISA) or a cessation of operations which
is treated as such a withdrawal under Section 4062(e) of ERISA; (d) a complete
or partial withdrawal by a Loan Party or any ERISA Affiliate from a
Multiemployer Plan or notification that a Multiemployer Plan is in
reorganization; (e) the filing of a notice of intent to terminate, the treatment
of a Plan amendment as a termination under Section 4041 or 4041A of ERISA, or
the commencement of proceedings by the PBGC to terminate a Pension Plan or
Multiemployer Plan; (f) an event or condition which might reasonably be expected
to constitute grounds under Section 4042 of ERISA or the commencement of
proceedings by the PBGC for the termination of, or the appointment of a trustee
to administer, any Pension Plan or Multiemployer Plan; (g) the imposition of any
liability under Title IV of ERISA, other than PBGC premiums due but not
delinquent under Section 4007 of ERISA, upon a Loan Party or any ERISA
Affiliate; (h) the making of any amendment to a Pension Plan which could result
in the imposition of a Lien or the posting of a bond or other security; (i) the
engagement in any transaction by a Loan Party or any ERISA Affiliate in
connection with which any such entity could be subject to either a tax imposed
by Section 4975(a) of the Code or the corresponding civil penalty assessed
pursuant to Section 502(i) of ERISA; or (j) the application for a waiver of the
minimum funding standard under Section 412 of the Code with respect to a Pension
Plan.
Event of Default means any of the events or circumstances specified
in Section 9.1.
Excess Cash Flow means, for any period, the remainder of (a) the
sum, without duplication, of (i) Consolidated Net Income for such period
(calculated by (x) excluding any gains or losses on the sale or other
disposition of assets (other than sales of inventory in the ordinary course of
business), (y) adding back the non-cash component of all extraordinary or
non-recurring items of expense and (z) deducting the non-cash component of all
extraordinary or non-recurring items of income, in each case to the extent taken
into account in the calculation of such Consolidated Net Income), plus (ii) all
depreciation and amortization of assets (including goodwill and other intangible
assets), non-cash interest expense and all other non-cash charges of US Borrower
and the Subsidiaries deducted in determining Consolidated Net Income for such
period, plus (iii) any net decrease in Adjusted Working Capital (as reflected on
the audited consolidated statement of cash flows in accordance with FAS 52)
during such period (exclusive of decreases in working capital associated with
asset sales), plus (iv) all federal, state, local and
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foreign income or capital taxes (whether paid or deferred) of US Borrower and
the Subsidiaries deducted in determining Consolidated Net Income for such
period, minus (b) the sum, without duplication, of (i) regularly scheduled
installment payments of principal of Term Loans pursuant to Section 2.9,
voluntary prepayments of the Term Loans pursuant to subsection 2.7(g),
prepayments of principal of Revolving Facility Loans pursuant to Section 2.8,
the aggregate principal amount of permanent principal payments with respect to
any other Indebtedness of US Borrower and the Subsidiaries, prepayments of the
Revolving Loans to the extent of any concurrent permanent reduction in the
Revolving Facility Commitments, and the portion of any regularly scheduled
payments with respect to Capital Leases allocable to principal, in each case
made during such period (in any such case other than to the extent any such
payment is made from the proceeds of any capital contribution to US Borrower or
any Subsidiary or from any proceeds from the issuance or sale of capital stock
of US Borrower or any Subsidiary, any incurrence of Indebtedness by US Borrower
or any Subsidiary or from the proceeds of any sale or other disposition of
assets by US Borrower or any Subsidiary (other than sales of inventory in the
ordinary course of business)), plus (ii) Capital Expenditures for such period
and cash paid in connection with any Acquisition during such period (other than
to the extent made from any capital contribution to US Borrower or any
Subsidiary or from any proceeds from the issuance or sale of capital stock of US
Borrower or any Subsidiary, any incurrence of Indebtedness by US Borrower or any
Subsidiary or from the proceeds of any sale or other disposition of assets by US
Borrower or any Subsidiary or insurance proceeds (other than sales of inventory
in the ordinary course of business)), plus (iii) all federal, state, local and
foreign income or capital taxes paid by US Borrower and the Subsidiaries during
such period, plus (iv) non-cash charges added back in any previous period
pursuant to item (a)(ii) above to the extent such charge has become a cash item
in the current period, plus (v) any net increase in Adjusted Working Capital (as
reflected on the audited consolidated statement of cash flows in accordance with
FAS 52) during such period (exclusive of increases in working capital associated
with asset sales).
Exchange Act means the United States Securities Exchange Act of
1934.
Exchange Notes -- see subsection 2.23(a).
Facility means any of the Tranche A Term Loan Facility, the Tranche
B Term Loan Facility, the Tranche C(CH) Term Loan Facility, the Tranche C(US)
Term Loan Facility or the Revolving Facility.
Facility Fee -- see subsection 2.11(b).
Fee Letters -- see subsection 2.11(a).
<PAGE>
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FIRREA means the Financial Institutions Reform, Recovery &
Enforcement Act of 1989, as amended from time to time, and any successor
statute.
Foreign Guarantor means each Foreign Subsidiary which executes and
delivers a Foreign Subsidiary Guarantee.
Foreign Loan Parties means CH Borrower, the Subsidiary Swing Line
Borrowers and the Foreign Guarantors.
Foreign Subsidiary means a direct or indirect Subsidiary of US
Borrower which is not a Domestic Subsidiary.
Foreign Subsidiary Guarantee means a guarantee substantially in the
form of the Domestic Subsidiary Guarantee entered into and delivered by a
Foreign Subsidiary, but with such modifications, additions and deletions as may
be required to comply with applicable law.
Foreign Subsidiary Securities Pledge Agreement means a securities
pledge agreement substantially in the form of the Domestic Subsidiary Securities
Pledge Agreement entered into and delivered by a Foreign Subsidiary, but with
such modifications, additions and deletions as may be required to comply with
applicable law.
FRB means the Board of Governors of the Federal Reserve System, and
any Governmental Authority succeeding to any of its principal functions.
French Francs and FF each mean lawful money of France.
GAAP means generally accepted accounting principles set forth as of
the relevant date in the opinions and pronouncements of the Accounting
Principles Board of the American Institute of Certified Public Accountants and
statements and pronouncements of the Financial Accounting Standards Board (or
agencies with similar functions of comparable stature and authority within the
U.S. accounting profession), which are applicable to the circumstances as of the
date of determination.
German Subsidiaries means each of the following Subsidiaries:
Garvens Automation GmbH, Giesen, a German corporation; Mettler-Toledo GmbH,
Giessen, a German corporation; and Mettler-Toledo (Albstadt) GmbH, Albstadt, a
German corporation.
Governmental Authority means any nation or government, any state,
canton or other political subdivision thereof, any central bank (or similar
monetary or regulatory authority) thereof, the NAIC, any entity exercising
executive, legislative, judicial, regulatory or
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administrative functions of or pertaining to government, and any corporation or
other entity owned or controlled, through stock or capital ownership or
otherwise, by any of the foregoing.
Guarantees means the Holding Guarantee, the Domestic Subsidiary
Guarantees, the Foreign Subsidiary Guarantees, the CH Borrower Guarantee and the
US Borrower Guarantee.
Guarantors means each of the Domestic Guarantors and the Foreign
Guarantors.
Guaranty Obligation has the meaning specified in the definition of
Contingent Obligation.
Hazardous Materials means any pollutant, contaminant, toxic,
hazardous or extremely hazardous substance, constituent or waste, or any other
constituent, waste, material, compound or substance including, without
limitation, petroleum (including crude oil or any fraction thereof) or any
petroleum product, subject to regulation under any Environmental Law.
Holding Guarantee means a guarantee substantially in the form of
Exhibit E-4 entered into and delivered by Holding.
Holding Securities Pledge Agreement means a securities pledge
agreement substantially in the form of Exhibit J-3 entered into and delivered by
Holding.
Honor Date -- see subsection 3.3(b).
Indebtedness of any Person means, without duplication, (a) all
indebtedness for borrowed money of such Person; (b) all obligations issued,
undertaken or assumed by such Person as the deferred purchase price of property
or services (other than trade payables and accrued expenses entered into in the
ordinary course of business on ordinary terms); (c) all non-contingent
reimbursement or payment obligations of such Person with respect to Surety
Instruments (such as, for example, unpaid reimbursement obligations in respect
of a drawing under a letter of credit); (d) all obligations of such Person
evidenced by notes, bonds, debentures or similar instruments, including
obligations so evidenced incurred in connection with the acquisition of
property, assets or businesses; (e) all indebtedness of such Person created or
arising under any conditional sale or other title retention agreement, or
incurred as financing, in either case with respect to property acquired by such
Person (even though the rights and remedies of the seller or lender under such
agreement in the event of default are limited to repossession or sale of such
property); (f) all obligations of such Person with respect to Capital Leases;
(g) all net obligations of such Person with respect to Swap Contracts (such
obligations to be equal at any time to the aggregate net amount that would have
been payable by such
<PAGE>
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Person at the most recent fiscal quarter end in connection with the termination
of such Swap Contracts at such fiscal quarter end); (h) all indebtedness of
other Persons referred to in clauses (a) through (g) above secured by (or for
which the holder of such Indebtedness has an existing right, contingent or
otherwise, to be secured by) any Lien upon or in property (including accounts
and contracts rights) owned by such Person, even though such Person has not
assumed or become liable for the payment of such Indebtedness; and (j) all
Guaranty Obligations of such Person in respect of indebtedness or obligations of
others of the kinds referred to in clauses (a) through (h) above. Indebtedness
shall not include accounts extended by suppliers in the ordinary course on
normal trade terms in connection with the purchase of goods and services.
Indemnified Person -- see Section 11.4.
Independent Auditor -- see subsection 7.1(a).
Initial Funding Date means the first date on which any Lender makes
a Loan hereunder.
Initial Loans means the Loans made on the Initial Funding Date.
Insolvency Proceeding means, with respect to any Person, (a) any
case, action or proceeding with respect to such Person before any court or by or
before any other Governmental Authority relating to bankruptcy, insolvency,
reorganization, liquidation, receivership, dissolution, sequestration,
conservatorship, winding-up or relief of debtors, or (b) any assignment for the
benefit of creditors, composition, marshalling of assets for creditors, or other
similar arrangement in respect of such Person's creditors generally or any
substantial portion of its creditors.
Intellectual Property -- see Section 6.15.
Intercompany Indebtedness -- see subsection 8.4(c).
Intercreditor Agreement means an Intercreditor Agreement,
substantially in the form of Exhibit N with such changes thereto as shall be
approved by the Administrative Agent.
Interest Expense means for any period the consolidated interest
expense of US Borrower and the Subsidiaries for such period (including all
imputed interest on Capital Leases, but excluding (i) amortization of fees and
expenses in connection with the M-T Acquisition, this Agreement and the
transactions contemplated by the foregoing, (ii) amortization in connection with
Swap Contracts and (iii) interest expense on deferred compensation or customer
deposits).
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Interest Payment Date means (a) as to any ABR Loan, the last
Business Day of each calendar quarter, (b) as to any LIBOR Rate Committed Loan,
the last day of each Interest Period applicable to such Loan; provided, however,
that if any Interest Period for a LIBOR Rate Committed Loan exceeds three
months, the date that falls three months (or, in the case of a 12-month
Interest Period, three months, six months and nine months) after the beginning
of such Interest Period also shall be an Interest Payment Date and (c) as to any
Non-U.S. $ Swing Line Loan, the last Business Day of each month.
Interest Period means, as to any LIBOR Rate Committed Loan, the
period commencing on the Borrowing Date of such Loan or, in the case of any
LIBOR Rate Committed Loan, on the Conversion/Continuation Date on which such
Loan is converted into or continued as a LIBOR Rate Committed Loan, and ending
on the date one, two, three, six, or, if available from all of the Lenders,
twelve months thereafter as selected by the applicable Borrower in its Notice of
Committed Borrowing or Notice of Conversion/Continuation, as the case may be;
provided, however, that:
(i) if any Interest Period would otherwise end on a day that is not
a Business Day, such Interest Period shall be extended to the following
Business Day unless, in the case of a LIBOR Rate Committed Loan, the
result of such extension would be to carry such Interest Period into
another calendar month, in which event such Interest Period shall end on
the preceding Business Day;
(ii) any Interest Period for a LIBOR Rate Committed Loan that begins
on the last Business Day of a calendar month (or on a day for which there
is no numerically corresponding day in the calendar month at the end of
such Interest Period) shall end on the last Business Day of the calendar
month at the end of such Interest Period;
(iii) no Interest Period for any Revolving Facility Loan shall
extend beyond the scheduled Termination Date;
(iv) no Interest Period for any Tranche A Term Loan shall extend
beyond any scheduled installment date unless the aggregate principal
amount of Term Loans under such Facility having Interest Periods that will
expire on or before such scheduled installment date equals or exceeds the
amount of the installment of Term Loans due under such Facility on such
date; and
(v) no Interest Period for any Term Loan under the Tranche B Term
Loan Facility, the Tranche C(CH) Term Loan Facility or the Tranche C(US)
Term Loan Facility shall extend beyond any scheduled installment date
unless the aggregate principal amount of all Term Loans under such
Facility that are ABR Loans, plus the aggregate
<PAGE>
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principal amount of all Term Loans under such Facility having Interest
Periods that will expire on or before such scheduled installment date,
equals or exceeds the amount of the installment of the Term Loans under
such Facility due on such date.
Interest Rate Certificate means an officers' certificate
substantially in the form of Exhibit K, delivered pursuant to subsection 7.1(b),
demonstrating in reasonable detail the calculation of the Debt to EBITDA Ratio
as of the last day of the subject period.
Inventory means all of the inventory of US Borrower and the
Subsidiaries, whether now existing or existing in the future, including, without
limitation: (i) all raw materials, work in process, parts, components,
assemblies, supplies and materials used or consumed in their business, (ii) all
goods, wares and merchandise, finished or unfinished, held for sale or lease or
leased or furnished or to be furnished under contracts of service, and (iii) all
goods returned or repossessed by US Borrower or the Subsidiaries.
Investment -- see Section 8.4.
Investors means AEA and its current, former and future employees,
stockholders, directors and officers and the officers of Holding, US Borrower
and CH Borrower, and (i) trusts for the benefit of such Persons or the spouses,
issue, parents or other relatives of such Persons, (ii) entities controlling or
controlled by such Persons and (iii) in the event of the death of any such
individual Person, heirs or testamentary legatees of such Person. Investors
shall also include Ciba-Geigy AG and its direct and indirect subsidiaries, the
specialty chemicals entity that will be spun off from Novartis in connection
with the merger of Ciba-Geigy and Sandoz and the direct and indirect
subsidiaries of such specialty chemicals entity; provided, however, that no such
entity referred to in this sentence owns, directly or indirectly, more than
seven and one-half percent (7.50%) on a fully diluted basis of the economic or
voting interest in the capital stock of Holding.
IRS means the Internal Revenue Service, and any Governmental
Authority succeeding to any of its principal functions under the Code.
Issuance Date -- see subsection 3.1(a).
Issue means, with respect to any Letter of Credit, to issue or to
extend the expiry of, or to renew or increase the amount of, such Letter of
Credit; and the terms Issued, Issuing and Issuance have corresponding meanings.
Japanese Yen means lawful money of Japan.
<PAGE>
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Joint Venture means a corporation, partnership, limited liability
company, joint venture or other similar legal arrangement (whether created by
contract or conducted through a separate legal entity) now or hereafter formed
by US Borrower or any Subsidiary with another Person or Persons in order to
conduct a common venture or enterprise with such Person or Persons and that is
not a Subsidiary (whether owned, directly or indirectly, 50% or less by US
Borrower or any Subsidiary).
L/C Advance means each L/C Lender's participation in any L/C
Borrowing in accordance with its Pro Rata Share.
L/C Amendment Application means an application form for amendment of
outstanding standby or commercial documentary letters of credit as shall at any
time be in use by the L/C Lender, as the L/C Lender shall request.
L/C Application means an application form for issuances of standby
or commercial documentary letters of credit as shall at any time be in use by
the L/C Lender, as the L/C Lender shall request.
L/C Borrowing means an extension of credit resulting from a drawing
under any Letter of Credit which shall not have been reimbursed on the date when
made nor converted into a Borrowing of Revolving Facility Loans under subsection
3.3(b).
L/C Commitment means the commitment of the L/C Lender to Issue
Letters of Credit from time to time Issued or outstanding under Article III, in
an aggregate Dollar Equivalent amount not to exceed on any date an amount equal
to the lesser of U.S. $40.0 million and the amount of the combined Commitments
of all L/C Lenders; it being understood that the L/C Commitment is a part of the
combined Revolving Facility Commitments of all L/C Lenders, rather than a
separate, independent commitment.
L/C Lender means the New York agency of Scotiabank or such other
Lender or Lenders selected by the Administrative Agent satisfactory to the
Borrowers who agrees to act in such capacity to issue Letters of Credit. All
references in this Agreement to the L/C Lender shall be deemed a reference to
each L/C Lender.
L/C Obligations means at any time the sum of (a) the aggregate
undrawn Dollar Equivalent amount of all Letters of Credit then outstanding, plus
(b) the Dollar Equivalent amount of all unreimbursed drawings under all Letters
of Credit, including all outstanding L/C Borrowings.
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L/C-Related Documents means the Letters of Credit, the L/C
Applications, the L/C Amendment Applications and any other document relating to
any Letter of Credit, including any of the L/C Lender's standard form documents
for letter of credit issuances.
Lease means any lease, sublease, franchise agreement, license,
occupancy or concession agreement.
Lender -- see the introduction to this Agreement; Lender shall
include any L/C Lender or Swing Line Lender.
Lender Default means (i) the refusal (which has not been retracted)
of a Lender to make available its portion of any Borrowing (including pursuant
to Section 2.18) or to fund its portion of any unreimbursed payment under
Section 3.3 or (ii) a Lender having notified the Administrative Agent and/or
either Borrower that it does not intend to comply with the obligations under
Section 2.1, 2.18 or 3.3.
Lending Office means, as to any Lender, the office or offices of
such Lender (or, in the case of any Offshore Currency Loan, of an Affiliate of
such Lender) specified to the Administrative Agent and the Borrowers as its
"Lending Office" or "Domestic Lending Office" or "Offshore Lending Office", as
the case may be.
Letter of Credit means any letter of credit (whether a standby
letter of credit or a commercial documentary letter of credit) Issued by the L/C
Lender pursuant to Article III.
LIBOR Rate means, with respect to each day during each Interest
Period pertaining to LIBOR Rate Committed Loans comprising part of the same
Borrowing, the rate per annum determined by the Administrative Agent to be the
arithmetic mean (rounded to the nearest 1/100th of 1%) of the offered rates for
deposits in Dollars or in the Applicable Currency with a term comparable to such
Interest Period that appears on the Telerate British Bankers Assoc. Interest
Settlement Rates Page (as defined below) at approximately 11:30 a.m., London,
England time, on the second full Business Day preceding the first day of such
Interest Period (or, in the case of Pounds Sterling, on the first day of such
Interest Period); provided, however, that if there shall at any time no longer
exist a Telerate British Bankers Assoc. Interest Settlement Rates Page, "LIBOR
Rate" shall mean, with respect to each day during each Interest Period
pertaining to LIBOR Rate Committed Loans comprising part of the same Borrowing,
the rate per annum equal to the rate at which Scotiabank is offered deposits in
Dollars or in the Applicable Currency at approximately 11:30 a.m., London,
England time, two Business Days prior to the first day of such Interest Period
(or, in the case of Pounds Sterling, on the first day of such Interest Period)
in the interbank eurocurrency market where the eurocurrency and foreign currency
and exchange operations in respect of Dollars or such Applicable Currency,
<PAGE>
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as the case may be, 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 LIBOR Rate Committed Loan to be outstanding
during such Interest Period. "Telerate British Bankers Assoc. Interest
Settlement Rates Page" shall mean the display designated as Page 3750 (or such
other page on which any Applicable Currency then appears) on the Telerate System
Incorporated Service (or such other page as may replace such page on such
service for the purpose of displaying the rates at which Dollar deposits in any
Applicable Currency are offered by leading banks in the London interbank deposit
market).
LIBOR Rate Committed Loan means any Committed Loan that bears
interest based on the LIBOR Rate.
Lien means any security interest, mortgage, deed of trust, pledge,
claim, hypothecation, assignment for security, charge or deposit arrangement,
preferential arrangement in the nature of security or lien (statutory or other),
or other encumbrance of any kind in respect of any property (including those
created by, arising under or evidenced by any conditional sale or other title
retention agreement.
Loan means an extension of credit by a Lender to the Borrowers under
Article II or Article III, which may be a Term Loan, a Revolving Loan, a Swing
Line Loan or an L/C Advance.
Loan Documents means this Agreement, any Note, the Fee Letters, the
L/C-Related Documents, the Guarantees, each Security Document and all other
documents delivered to any Agent or any Lender in connection herewith.
Loan Parties means the Domestic Loan Parties and the Foreign Loan
Parties.
Losses means as to any Person, the losses, liabilities, claims
(including those based upon negligence, strict or absolute liability and
liability in tort), damages, expenses, obligations, penalties, actions,
judgments, Liens, penalties, fines, suits, costs or disbursements of any kind or
nature whatsoever (including Attorney Costs in connection with any Proceeding
commenced or threatened, whether or not such Person shall be designated a party
thereto) at any time (including following the payment of the Obligations and/or
the termination of the Commitments hereunder) incurred by, imposed on or
asserted against such Person.
Majority Lenders of the Affected Tranche means (i) at any time prior
to the Closing Date, Non-Defaulting Lenders holding at least a majority of the
aggregate amount of the Commitments of the Non-Defaulting Lenders of the
applicable Term Loan Facility which would be adversely affected by any
amendment, waiver or consent contemplated by clause (6)
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of the second proviso to subsection 11.1(a) and (ii) at any time after the
Closing Date, Non-Defaulting Lenders holding at least a majority of the
aggregate amount of the outstanding Loans of the Non-Defaulting Lenders of the
applicable Term Loan Facility which would be adversely affected by any
amendment, waiver or consent contemplated by clause (6) of the second proviso to
subsection 11.1(a).
Management Services Agreement means the Management Services
Agreement dated as of October 15, 1996, between AEA and US Borrower, as in
effect on the Closing Date and as the same may be amended and in effect from
time to time in accordance with Section 8.18.
Margin Stock means "margin stock" as such term is defined in
Regulation G, T, U or X of the FRB.
Material Adverse Effect means (a) a material adverse effect upon the
operations, business, assets, nature of assets, properties, condition (financial
or otherwise), solvency or prospects of US Borrower and the Subsidiaries taken
as a whole (which term "Subsidiary" shall include, on or prior to the Closing
Date, any entity which will become or be merged into either Borrower or any of
its Subsidiaries on the Closing Date in connection with the Transactions); or
(b) a material adverse effect on the rights and remedies of the Agents or the
Lenders under the Loan Documents.
Mettler-Toledo Group means the entities (other than those affiliated
solely with Holding immediately prior to the consummation of the M-T
Acquisition) set forth in the M-T Acquisition Documents and any additional
entities formed by such parties or their Affiliates in connection with
consummating the M-T Acquisition.
Mettler-Toledo, Inc. means Mettler-Toledo, Inc., a Delaware
corporation, and its successors.
Minimum Tranche means, in respect of Loans comprising part of the
same Borrowing, or to be converted or continued under Section 2.4, (a) in the
case of ABR Loans, U.S. $1.0 million or a higher integral multiple of U.S. $1.0
million, (b) in the case of LIBOR Rate Committed Loans (other than Revolving
Loans and Tranche A Term Loans), a minimum Dollar Equivalent amount of U.S. $5.0
million and an integral multiple of U.S. $1.0 million, (c) in the case of
Revolving Loans which are LIBOR Rate Committed Loans, a minimum Dollar
Equivalent amount of U.S. $1.0 million and an integral multiple of U.S. $1.0
million and (d) in the case of Tranche A Term Loans, a minimum amount of 5.0
million units of the Applicable Currency and an integral multiple of 1.0 million
units of the Applicable Currency.
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MLA Cost means the cost imputed to a Lender making a Committed Loan
in Pounds Sterling of compliance with the Mandatory Liquid Assets requirements
of the Bank of England during the Interest Period of that Loan determined in
accordance with Schedule 1.1(b).
Moody's means Moody's Investors Service, Inc. or its successors.
Mortgage means a term loan and revolving credit mortgage, assignment
of leases, security agreement and fixture filing, or a term loan and revolving
credit deed of trust, assignment of leases, security agreement and fixture
filing creating and evidencing a Lien on a Mortgaged Real Property, which shall
be substantially in the form of Exhibit I, containing such schedules and
including such additional provisions and other deviations from such Exhibits as
shall be necessary to conform such document to applicable or local law or as
shall be required under local law and which shall be dated as of the date of
delivery thereof and made by the owner of the Mortgaged Real Property described
therein for the benefit of the Administrative Agent, as mortgagee (grantee or
beneficiary), assignee and secured party, as the same may at any time be
amended, modified or supplemented in accordance with the terms thereof and
hereof.
Mortgaged Real Property means each Real Property designated on
Schedule 1.1(c) which shall be subject to a Mortgage and each additional Real
Property which shall be subject to a Mortgage delivered pursuant to Section
7.14.
M-T Acquisition means the acquisition by US Borrower or one or more
of the Subsidiaries of the Mettler-Toledo Group pursuant to the M-T Acquisition
Documents.
M-T Acquisition Documents means the documents listed in Schedule
1.1(d) hereto, in each case as in effect on the date hereof and as amended and
in effect from time to time in accordance with Section 8.18.
M-T AG means Mettler-Toledo AG Greifensee, a Swiss corporation and a
Subsidiary.
M-T Investors means MT Investors Inc., a Delaware corporation, and
any successors thereto.
M-T Leicester means Mettler-Toledo Ltd., Leicester, an English
corporation and a Subsidiary, and its successors.
Multiemployer Plan means a "multiemployer plan," within the meaning
of Section 4001(a)(3) of ERISA, to which a Loan Party or any ERISA Affiliate
makes, is making
<PAGE>
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or is obligated to make contributions or with respect to which it otherwise may
have any liability.
NAIC means the National Association of Insurance Commissioners.
Net Award has the meaning assigned to that term in each Mortgage.
Net Cash Proceeds means
(a) with respect to any Asset Sale, the aggregate cash proceeds
(including cash proceeds received by way of deferred payment of principal
pursuant to a note, installment receivable, liquidation or payment of any
Investment permitted by subsection 8.4(d), reserve for adjustment or
otherwise, but only as and when received) received by US Borrower or any
Subsidiary pursuant to such Asset Sale, net of (i) the direct and indirect
costs relating to such Asset Sale (including sales commissions and legal,
accounting and investment banking fees), (ii) taxes, fees, impositions and
recording charges paid or payable as a result thereof (after taking into
account any tax credits or deductions taken in connection with such Asset
Sale and any tax sharing arrangements), (iii) amounts applied to the
repayment of any Indebtedness secured by a Lien on the asset subject to
such Asset Sale (other than the Obligations), (iv) liabilities of the
entity, or relating to the business or assets, sold, transferred or
otherwise disposed of which are retained by US Borrower or the applicable
Subsidiary, (v) amounts required to be paid to any Person (other than US
Borrower or any Subsidiary) owning a beneficial interest in the assets
subject to the Asset Sale and (vi) appropriate amounts to be provided by
US Borrower or any Subsidiary, as the case may be, as a reserve required
in accordance with GAAP against any liabilities associated with such Asset
Sale and retained by the US Borrower or any Subsidiary, as the case may
be, after such Asset Sale (but upon reversal of such reserve, any amount
so reserved shall thereupon be Net Cash Proceeds);
(b) with respect to any issuance of equity securities or
Indebtedness, the aggregate cash proceeds (including cash proceeds
received by way of deferred payment of principal pursuant to a note,
installment receivable, reserve for adjustment or otherwise, but only as
and when received) received by Holding or any of its Subsidiaries pursuant
to such issuance, net of the direct costs relating to such issuance
(including sales and underwriter's commissions and legal, accounting and
investment banking fees); and
(c) with respect to any Taking, Destruction, or loss of title to all
or a portion of any Mortgaged Real Property, the Net Award, Net Proceeds
or title insurance proceeds (net of any reasonable costs incurred to
recover such title insurance proceeds), as applicable, resulting
therefrom, to be applied as Net Cash Proceeds under this Agreement
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pursuant to the provisions of the Mortgages; provided, however, such
amounts have not been applied to restore or rebuild the Mortgaged Real
Property so Taken or Destroyed as permitted or required by the applicable
Mortgage and this Agreement.
If Holding or any of its Subsidiaries receives Net Cash Proceeds in
a currency other than U.S. Dollars, the Dollar Equivalent amount thereof shall
be determined as of the earlier of (i) the date on which such Net Cash Proceeds
are required to be applied to prepayments under Section 2.7 and (ii) the date on
which such Net Cash Proceeds are converted into the currency in which any such
prepayment will be required.
Net Proceeds has the meaning assigned to that term in each Mortgage.
Net Tangible Assets means, at any time, the aggregate amount which,
in accordance with GAAP, would be included as total assets (less intangible
assets) on the consolidated balance sheet of US Borrower and the Subsidiaries at
such time, minus the aggregate amount which, in accordance with GAAP, would be
included as Current Liabilities on the consolidated balance sheet of US Borrower
and the Subsidiaries at such time.
Non-Defaulting Lender means each Lender other than a Defaulting
Lender.
Non-Guarantor Subsidiary means any Subsidiary set forth on Schedule
1.1(e).
Non-U.S. $ Swing Line Loans means any Swing Line Loan that is not
made in U.S. Dollars.
Notes means the Tranche A Term Notes, the Tranche B Term Notes, the
Tranche C(CH) Term Notes, the Tranche C(US) Term Notes, the Revolving Notes and
the Swing Line Notes and, if issued, the QFL Notes and Note means any of them.
Notice of Committed Borrowing means a notice in substantially the
form of Exhibit A.
Notice of Conversion/Continuation means a notice in substantially
the form of Exhibit B (in the case of a notice pursuant to Section 2.4).
Obligations means all advances, debts, liabilities, obligations,
guarantees, covenants and duties arising under any Loan Document, owing by any
Loan Party to any Lender, any Agent or any Indemnified Person, whether direct or
indirect (including those acquired by assignment), absolute or contingent, due
or to become due, now existing or hereafter arising.
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Officers' Certificate shall mean, as applied to any corporation, a
certificate executed on behalf of such corporation by its Chairman of the Board
(if an officer) or its President or one of its Vice Presidents and by its Chief
Financial Officer or its Treasurer or, in the case of Foreign Subsidiaries,
officers or persons performing comparable functions. Each Officers' Certificate
with respect to the compliance with a condition precedent or agreement hereunder
shall include (i) a statement that the signers have read such condition or
agreement and any definitions or other provisions contained in this Agreement
relating thereto, (ii) a statement that, in the opinion of the signers, they
have made or have caused to be made such examination or investigation as is
reasonably necessary to enable them to express an opinion as to whether or not
such condition or agreement has been complied with, and (iii) a statement as to
whether, in the opinion of the signers, based upon such examination or
investigation, such condition or agreement has been complied with.
Offshore Currency means at any time Deutschemarks, French Francs,
Japanese Yen, Pounds Sterling, Swiss Francs or any Agreed Alternative Currency.
Offshore Currency Loan means any LIBOR Rate Committed Loan
denominated in an Offshore Currency.
Offshore U.S. Dollar Loan means any LIBOR Rate Committed Loan
denominated in U.S. Dollars.
Operating Lease Expense means all operating lease expenses of US
Borrower and the Subsidiaries.
Organization Documents means, for any corporation, the certificate
or articles of incorporation or association, the bylaws, any certificate of
determination or instrument relating to the rights of preferred shareholders of
such corporation, any shareholder rights agreement or voting trust agreement,
and all applicable resolutions of the board of directors (or any committee
thereof) of such corporation and all other documents of a comparable nature and,
for each partnership, its partnership agreement, its certificate of partnership
and all other documents of the nature previously described as to a corporation.
Other Documents means the Ciba Loan Documents, the Ciba
Reimbursement Agreement, the Tax Sharing Agreement, the Management Services
Agreement and the Existing Affiliate Agreements and all other documents,
instruments and agreements entered into in connection with such documents
including all appendices, annexes, schedules, attachments and exhibits to any
such document, in each case as amended and in effect from time to time in
accordance with Section 8.18.
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Overnight Rate means, for any Committed Loan (other than a Swing
Line Loan that is made in any Applicable Currency other than U.S. Dollars or
Pounds Sterling) for any day, the rate of interest per annum at which overnight
deposits in the Applicable Currency, in an amount approximately equal to the
amount with respect to which such rate is being determined, would be offered for
such day by the Administrative Agent's London Branch to major banks in the
London or other applicable offshore interbank market. The Overnight Rate for any
day which is not a Business Day shall be the Overnight Rate for the preceding
Business Day. The Overnight Rate for any Swing Line Loan made in any Applicable
Currency other than U.S. Dollars or Pounds Sterling means, for any day, the rate
of interest per annum determined by the Applicable Swing Line Lender.
Participant -- see subsection 11.8(d).
PBGC means the Pension Benefit Guaranty Corporation, or any
Governmental Authority succeeding to any of its principal functions under ERISA.
Pension Plan means a pension plan (as defined in Section 3(2) of
ERISA) subject to Title IV of ERISA or subject to the minimum funding standards
under Section 412 of the Code which a Loan Party or any ERISA Affiliate sponsors
or maintains, or to which it makes, is making or is obligated to make
contributions, or with respect to which it otherwise may have any liability.
Permitted Liens -- see Section 8.1.
Person means an individual, partnership, corporation, limited
liability company, business trust, joint stock company, trust, unincorporated
association, joint venture or Governmental Authority.
Plan means an employee benefit plan (as defined in Section 3(3) of
ERISA) which a Loan Party or any ERISA Affiliate sponsors or maintains or to
which a Loan Party or any ERISA Affiliate makes, is making or is obligated to
make contributions or with respect to which it otherwise may have any liability,
and includes any Pension Plan.
Pledged Securities means all the Security Agreement Collateral as
defined in each of the Securities Pledge Agreements.
Pounds Sterling means the lawful money of the United Kingdom.
Prior Liens means Liens which pursuant to the provisions of any
Security Document are or may be superior to the Liens of such Security Document.
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Proceeding means any claim, action, judgment, suit, hearing,
governmental investigation, arbitration (to the extent binding on US Borrower or
any Subsidiary) or proceeding, including by or before any Governmental
Authority.
Pro Rata Share means as to any Lender in respect of any Facility at
any time, the percentage equivalent (expressed as a decimal, rounded to the
ninth decimal place) at such time of (a) prior to termination of the Commitments
in such Facility, (i) such Lender's Commitment in such Facility divided by (ii)
the combined Commitments of all Lenders in such Facility, or (b) after
termination of the Commitments in such Facility, (i) the aggregate principal
Dollar Equivalent amount of such Lender's Loans under such Facility, plus (in
the case of the Revolving Facility) (without duplication) the participation of
such Lender in the aggregate Effective Amount of all L/C Obligations and the
Dollar Equivalent amount of all Swing Line Loans, divided by (ii) the aggregate
Dollar Equivalent principal amount of all Loans under such Facility, plus (in
the case of the Revolving Facility) (without duplication) the Effective Amount
of all L/C Obligations.
QFL B Note -- see subsection 2.23(a).
QFL C(US) Note -- see subsection 2.23(a).
QFL Notes -- see subsection 2.23(a).
Qualified Subsidiary Guarantor means any Subsidiary Guarantor the
Guarantee of which does not on its face exclude any Obligations of the
applicable Borrower, not taking into account any restrictions resulting from the
amount of capital of such Subsidiary Guarantor available for distribution.
Real Property means all right, title and interest of the Borrowers
or any of their respective Subsidiaries (including, without limitation, any
leasehold estate) in and to a parcel of real property owned or operated by
either Borrower or any of its respective Subsidiaries together with, in each
case, all improvements and appurtenant fixtures, equipment, personal property,
easements and other property and rights incidental to the ownership, lease or
operation thereof.
Reimbursement Obligations shall mean, at any time, the obligations
of the Borrowers then outstanding, or that may thereafter arise in respect of
all Letters of Credit then outstanding, to reimburse amounts paid by the L/C
Lender in respect of any drawings under a Letter of Credit.
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Related Business means the businesses of US Borrower and the
Subsidiaries as conducted on the Closing Date, and any businesses related,
ancillary or complementary to such businesses.
Replacement Lender -- see Section 4.8.
Reportable Event means any of the events set forth in Section
4043(b) of ERISA or the regulations thereunder with respect to which a Loan
Party or any ERISA Affiliate would be subject to the notice requirements of
Section 4043(b), other than any such event for which the 30-day notice
requirement under ERISA has been waived in regulations issued by the PBGC.
Required Lenders means Non-Defaulting Lenders then holding at least
a majority of the sum of (i) the then aggregate unused amount of the Commitments
of the Non-Defaulting Lenders, plus (ii) the then aggregate unpaid Dollar
Equivalent principal amount of the Loans of the Non-Defaulting Lenders, plus
(iii) (without duplication) the then aggregate Effective Amount of the L/C
Obligations of the Non-Defaulting Lenders. For purposes of determining whether
the Required Lenders have approved any amendment, waiver or consent or taken any
other action hereunder, the Dollar Equivalent amount of all Offshore Currency
Loans shall be calculated on the date immediately preceding the date such
amendment, waiver or consent is to become effective or such action is to be
taken.
Required Revolving Facility Lenders means (a) at any time prior to
the Termination Date, Revolving Facility Lenders which are Non-Defaulting
Lenders then holding at least a majority of the sum of (i) the then aggregate
Available Revolving Facility Commitments of all Revolving Facility Lenders which
are Non-Defaulting Lenders, plus (ii) the then Aggregate Outstanding Revolving
Credit of all Revolving Facility Lenders which are Non-Defaulting Lenders, and
(b) otherwise, Revolving Facility Lenders which are Non-Defaulting Lenders then
holding at least a majority of the then Aggregate Outstanding Revolving Credit
of all Revolving Facility Lenders which are Non-Defaulting Lenders. For purposes
of determining whether the Required Revolving Facility Lenders have approved any
amendment, waiver or consent or taken any other action hereunder, the Dollar
Equivalent amount of all Offshore Currency Loans shall be calculated on the date
immediately preceding the date such amendment, waiver or consent is to become
effective or such action is to be taken.
Requirement of Law means, as to any Person, any law (statutory or
common), treaty, rule or regulation or determination of an arbitrator or of a
Governmental Authority, in each case applicable to or binding upon the Person or
any of its property or to which the Person or any of its property is subject.
Reset Date -- see the definition of Applicable Margin.
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Responsible Officer means the chief executive officer, the chief
financial officer, the president or any vice-president of the applicable
Borrower, or any other officer having substantially the same authority and
responsibility; or, with respect to compliance with financial covenants, the
chief financial officer, the treasurer or controller of the applicable Borrower,
or any other officer having substantially the same authority and responsibility.
Restoration has the meaning assigned to that term in each Mortgage.
Restricted Payment -- see Section 8.13.
Revolving Facility means the revolving multicurrency credit facility
in an aggregate principal amount equal to the Dollar Equivalent of U.S. $140.0
million with a letter of credit subfacility and a swing line subfacility
provided hereunder as set forth in subsection 2.1(e) and Sections 2.16 and 3.1.
Revolving Facility Commitment -- see subsection 2.1(e).
Revolving Facility Lender means a lender having a Revolving Facility
Commitment or a Swing Line Commitment or holding a Revolving Facility Loan or a
participation in an L/C Advance.
Revolving Facility Loan means an extension of credit by a Revolving
Facility Lender to a Borrower or a Subsidiary Swing Line Borrower under the
Revolving Facility pursuant to Article II or Article III, which may be a
Revolving Loan, a Swing Line Loan or an L/C Advance.
Revolving Loan -- see subsection 2.1(e).
Revolving Loan Maturity Date means December 31, 2002.
Revolving Note and Revolving Notes -- see Section 2.2.
Same Day Funds means (i) with respect to disbursements and payments
in U.S. Dollars, immediately available funds, and (ii) with respect to
disbursements and payments in an Offshore Currency, same day or other funds as
may be determined by the Administrative Agent to be customary in the place of
disbursement or payment for the settlement of international banking transactions
in the relevant Offshore Currency.
Scotiabank -- see the introduction to this Agreement.
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SEC means the United States Securities and Exchange Commission, or
any Governmental Authority succeeding to any of its principal functions.
Section 4.1(f)(i) Certificate -- see subsection 4.1(f)(i).
Section 4.1(f)(v) Certificate -- see subsection 4.1(f)(v).
Secured Parties has the meaning specified in the Security Documents.
Securities Pledge Agreements means the US Borrower Securities Pledge
Agreement, the Holding Securities Pledge Agreement, the Domestic Subsidiary
Securities Pledge Agreement and the Foreign Subsidiary Securities Pledge
Agreement and any other securities pledge agreements delivered pursuant to
Section 7.14 or Section 7.15.
Security Agreement means a security agreement substantially in the
form of Exhibit D hereto entered into and delivered by each of the Borrowers and
certain of the Subsidiary Guarantors.
Security Agreement Collateral means all "Collateral" as defined in
the Security Agreement.
Security Documents means each of the Securities Pledge Agreements,
Security Agreements, the Mortgages and any other documents utilized to pledge as
Collateral for the Obligations any other property or assets of whatever kind or
nature.
Senior Subordinated Note Documents shall mean and include each of
the documents and other agreements entered into (including, without limitation,
the Senior Subordinated Note Indenture) relating to the issuance by US Borrower
of the Senior Subordinated Notes, as in effect on the Closing Date and as the
same may be entered into, modified, supplemented or amended from time to time
pursuant to the terms hereof and thereof.
Senior Subordinated Note Indenture shall mean the Indenture, dated
as of October 15, 1996, entered into by and among US Borrower, Holding and
United States Trust Company of New York, as trustee thereunder, as in effect on
the Closing Date and as amended and in effect from time to time in accordance
with Section 8.18.
Senior Subordinated Notes means the U.S. $135.0 million 9-3/4%
senior subordinated notes due 2006 of US Borrower issued under the Senior
Subordinated Note Indenture.
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S&P means Standard & Poor's Corporation.
Specified Subsidiary means any Non-Guarantor Subsidiary or any
Subsidiary set forth on Schedule 7.22.
Spot Rate means with respect to any Applicable Currency, at any date
of determination thereof, the spot rate of exchange for such date in London that
appears on the display page applicable to such Applicable Currency on the
Telerate System Incorporated Service (or such other page as may replace such
page on such service for the purpose of displaying the spot rate of exchange in
London); provided, however, that if there shall at any time no longer exist such
a page or a relevant spot rate is not shown on such service, the spot rate of
exchange shall be determined by reference to another similar rate publishing
service selected by the Administrative Agent and if no such similar rate
publishing service is available by reference to the published rate of the
Administrative Agent in effect at such date for similar commercial transactions.
State, Local and Foreign Real Property Disclosure Requirements means
any federal, state or local laws requiring notification of the buyer of real
property, or notification, registration, or filing to or with any state or local
agency, prior to the sale of any real property or transfer of control of an
establishment, of the actual or threatened presence or release into the
environment, or the use, disposal, or handling of Hazardous Materials on, at,
under, or near the real property to be sold or the establishment for which
control is to be transferred.
Subsidiary of a Person means any corporation, association,
partnership, limited liability company, joint venture, business trust or other
business entity of which more than 50% of the voting stock, membership interests
or other equity interests is owned or controlled directly or indirectly by such
Person, or one or more of the Subsidiaries of such Person, or a combination
thereof. Notwithstanding the foregoing, any Joint Venture which is not majority
owned by, but is controlled by, US Borrower or a Subsidiary and the financial
results of which are included in the consolidated financial statements of US
Borrower shall be deemed to be a Subsidiary of US Borrower. Unless the context
otherwise clearly requires, references herein to a "Subsidiary" refer to a
Subsidiary of US Borrower. The term Subsidiary shall also include any Person to
become a Subsidiary pursuant to the M-T Acquisition.
Subsidiary Guarantees means each Domestic Subsidiary Guarantee and
each Foreign Subsidiary Guarantee.
Subsidiary Guarantors means the Domestic Subsidiary Guarantors and
the Foreign Guarantors.
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Subsidiary Swing Line Borrowers means each of the following
Subsidiaries: each of the German Subsidiaries; Mettler-Toledo S.A., Veroflay, a
French corporation; Mettler-Toledo K.K., Takarazuka, a Japanese corporation;
M-T AG; M-T Leicester; and each of their respective successors.
Subsidiary Swing Line Borrower Sublimit means the amounts set forth
opposite such Subsidiary's (or, in the case of the German Subsidiaries, their
collective) name in the table below (it being understood that for the German
Subsidiaries the amount is an aggregate sublimit for all of them together), as
adjusted pursuant to subsection 2.6(a):
================================================================================
Name of Subsidiary Units of Applicable Currency
================================================================================
German Subsidiaries DM 10,000,000
- --------------------------------------------------------------------------------
Mettler-Toledo S.A., Veroflay FF 8,000,000
- --------------------------------------------------------------------------------
Mettler-Toledo K.K., Takarazuka 100,000,000 Japanese Yen
- --------------------------------------------------------------------------------
M-T AG CHF 10,000,000
- --------------------------------------------------------------------------------
M-T Leicester 500,000 Pounds Sterling
================================================================================
Substitute Lender -- see Section 2.22.
Supermajority Lenders means Non-Defaulting Lenders then holding at
least 66-2/3% of the sum of (i) the then aggregate unused amount of the
Commitments of the Non-Defaulting Lenders, plus (ii) the then aggregate unpaid
Dollar Equivalent principal amount of the Loans of the Non-Defaulting Lenders,
plus (iii) (without duplication) the then aggregate Effective Amount of the L/C
Obligations of the Non-Defaulting Lenders. For purposes of determining whether
the Supermajority Lenders have approved any amendment, waiver or consent or
taken any other action hereunder, the Dollar Equivalent amount of all Offshore
Currency Loans shall be calculated on the date immediately preceding the date
such amendment, waiver or consent is to become effective or such action is to be
taken.
Surety Instruments means all letters of credit (including standby
and commercial), banker's acceptances, bank guaranties, surety bonds and similar
instruments.
Survey means a survey of any Mortgaged Real Property (and all
improvements thereon): (i) prepared by a surveyor or engineer licensed to
perform surveys in the state, province or country where such Mortgaged Real
Property is located, (ii) dated (or redated) not earlier than six months prior
to the date of delivery thereof unless there shall have occurred
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within the six months prior to such date of delivery any exterior construction
on the site of such Mortgaged Real Property, in which event such survey shall be
dated (or redated) after the completion of such construction or if such
construction shall not have been completed as of such date of delivery, not
earlier than 20 days prior to such date of delivery, (iii) certified by the
surveyor (in a manner reasonably acceptable to the Administrative Agent) to the
Administrative Agent and the Title Company and (iv) complying in all material
respects with the minimum detail requirements of the American Land Title
Association as such requirements are in effect on the date of preparation of
such survey; provided, however, that such survey is in a form reasonably
acceptable to the Title Company.
Swap Contract means any agreement (including any master agreement
and any agreement, whether or not in writing, relating to any single
transaction) that is an interest rate swap agreement, basis swap, forward rate
agreement, commodity swap, commodity option, equity or equity index swap or
option, bond option, interest rate option, foreign exchange agreement, rate cap,
collar or floor agreement, currency swap agreement, cross-currency rate swap
agreement, swaption, currency option or any other, similar agreement (including
any option to enter into any of the foregoing).
Swing Line Borrowers means US Borrower and the Subsidiary Swing Line
Borrowers.
Swing Line Commitment means the commitment of each Swing Line Lender
to make Swing Line Loans hereunder in an aggregate Dollar Equivalent amount not
to exceed on any date an amount equal to the lesser of U.S. $25.0 million and
the amount of the combined Commitments of all Swing Line Lenders, it being
understood that the Swing Line Commitment is a part of the combined Revolving
Facility Commitments of all Swing Line Lenders, rather than a separate
independent commitment.
Swing Line Lender means each of Credit Suisse (with respect solely
to Swing Line Loans to be made to M-T AG), Scotiabank (with respect solely to
Swing Line Loans to be made in U.S. Dollars to US Borrower and Pounds Sterling
to M-T Leicester) and such other Lenders as selected by the Subsidiary Swing
Line Borrowers and agreed to by such Lender (in each case solely with respect to
the Offshore Currency in which such Lender agrees to make Swing Line Loans
available to such Subsidiary Swing Line Borrower), in each case in its capacity
as a swing line lender hereunder, and Swing Line Lenders means all of them.
Swing Line Loan -- see Section 2.16.
Swing Line Loan Calculation Date -- see subsection 2.7 (j).
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Swing Line Note and Swing Line Notes -- see Section 2.2.
Swiss Francs and CHF each mean lawful money of Switzerland.
Taking has the meaning assigned to that term in each Mortgage.
Tax Sharing Agreement means the Tax Sharing Agreement dated as of
October 15, 1996 between MT Investors and US Borrower, as amended and in effect
from time to time in accordance with Section 8.18.
Taxes means any and all present or future income, stamp,
documentary, excise, property or other taxes, levies, imposts, duties,
deductions, charges, fees or withholdings, now or hereafter imposed, levied,
collected, withheld or assessed by any Governmental Authority, and all
liabilities with respect thereto, including any present or future Taxes or
similar levies which arise from any payment made hereunder or from the
execution, delivery or registration of, or otherwise with respect to, this
Agreement or any other Loan Document.
Termination Date means the earlier to occur of (i) the date 30
Business Days prior to the Revolving Loan Maturity Date and (ii) the date on
which the Revolving Facility Commitments are terminated or reduced to zero
pursuant to Section 2.6.
Term Loan Commitments means the Tranche A Facility Commitments, the
Tranche B Commitments, the Tranche C(CH) Commitments and the Tranche C(US)
Commitments of all the Lenders having such commitments.
Term Loan Facilities means the Tranche A Term Loan Facility, the
Tranche B Term Loan Facility, the Tranche C(CH) Term Loan Facility and the
Tranche C(US) Term Loan Facility.
Term Loans means the loans made under the Term Loan Facilities.
Title Company shall mean First American Title Insurance Company or
such other title insurance or abstract company as shall be designated by the
Required Lenders.
Tranche A Facility Commitment means a Lender's commitment to make a
Tranche A Term Loan hereunder.
Tranche A Lender means a Lender having a Tranche A Facility
Commitment.
Tranche A Term Loan -- see subsection 2.1(a).
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Tranche A Term Loan Facility means the term loan facility in an
aggregate principal amount of CHF 125.0 million.
Tranche A Term Loan Maturity Date means December 31, 2002.
Tranche A Term Note and Tranche A Term Notes -- see Section 2.2.
Tranche B Facility Commitment means a Lender's commitment to make a
Tranche B Term Loan hereunder.
Tranche B Lender means a Lender having a Tranche B Facility
Commitment.
Tranche B Term Loan -- see subsection 2.1(b).
Tranche B Term Loan Facility means the term loan facility in an
aggregate principal amount of U.S. $75.0 million.
Tranche B Term Loan Maturity Date means December 31, 2003.
Tranche B Term Note and Tranche B Term Notes -- see Section 2.2.
Tranche C Term Loans means loans made under the Tranche C(CH) Term
Loan Facility and the Tranche C(US) Term Loan Facility.
Tranche C(CH) Facility Commitment means a Lender's commitment to
make a Tranche C(CH) Loan hereunder.
Tranche C(CH) Lender means a Lender having a Tranche C(CH) Facility
Commitment.
Tranche C(CH) Term Loan -- see subsection 2.1(c).
Tranche C(CH) Term Loan Facility means the term loan facility in an
aggregate principal amount of U.S. $32.0 million.
Tranche C(CH) Term Loan Maturity Date means December 31, 2004.
Tranche C(CH) Term Note and Tranche C(CH) Term Notes -- see Section
2.2.
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Tranche C(US) Facility Commitment means each Lender's commitment to
make a Tranche C(US) Loan hereunder.
Tranche C(US) Lender means each Lender having a Tranche C(US)
Facility Commitment.
Tranche C(US) Term Loan -- see subsection 2.1(c).
Tranche C(US) Term Loan Facility means the term loan facility in an
aggregate principal amount of U.S. $40.0 million.
Tranche C(US) Term Loan Maturity Date means December 31, 2004.
Tranche C(US) Term Note and Tranche C(US) Term Notes -- see Section
2.2.
Transaction Documents means the M-T Acquisition Documents, the
Senior Subordinated Note Documents, the documents and instruments entered into
in connection with the Equity Issuance and each other document (other than the
Loan Documents) relating to the Transactions including all appendices, annexes,
schedules, attachments and exhibits to any such document.
Transactions means the M-T Acquisition, the offering and sale of the
Senior Subordinated Notes and the other transactions contemplated hereby, and
thereby to be effected in connection therewith.
Type of Loan means an ABR Loan or a LIBOR Rate Committed Loan.
UCC means the Uniform Commercial Code as in effect in the State of
New York.
Unfunded Pension Liability means the excess of a Pension Plan's
benefit liabilities under Section 4001(a)(16) of ERISA over the fair market
value of such Plan's assets (including all accrued contributions required to be
made to the Plan in respect of the applicable plan year), determined in
accordance with the actuarial assumptions used for funding such Plan pursuant to
Section 412 of the Code for the applicable plan year.
Unmatured Event of Default means any event or circumstance which,
with the giving of notice, the lapse of time, or both, would (if not cured or
otherwise remedied during such time) constitute an Event of Default.
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US Borrower Guarantee means the guarantee agreement substantially in
the form of Exhibit E-5 entered into and delivered by US Borrower.
US Borrower Securities Pledge Agreement means a securities pledge
agreement substantially in the form of Exhibit J-4 entered into and delivered by
US Borrower.
US Borrower Sublimit means U.S. $6.0 million, as adjusted pursuant
to subsection 2.6(a).
U.S. Dollars and U.S. $ each mean lawful money of the United States.
U.S. Federal Funds Rate means, for any day, the rate set forth in
the weekly statistical release designated as H.15(519), or any successor
publication, published by the Federal Reserve Bank of New York (including any
such successor, "H.15(519)") on the preceding Business Day opposite the caption
"Federal Funds (Effective)"; or, if for any relevant day such rate is not so
published on any such preceding Business Day, the rate for such day will be the
arithmetic mean as determined by the Administrative Agent of the rates for the
last transaction in overnight Federal funds arranged prior to 9:00 a.m. (New
York City time) on that day by each of three leading brokers of Federal funds
transactions in New York City selected by the Administrative Agent.
Wholly-Owned Subsidiary means, for any Person, any corporation in
which (other than directors' qualifying shares or other shareholdings required
by law) 100% of the capital stock of each class having ordinary voting power,
and 100% of the capital stock of each other class, at the time as of which any
determination is being made, is owned, beneficially and of record, by such
Person, or by one or more of the other Wholly-Owned Subsidiaries, or a
combination thereof.
1.2. Other Interpretive Provisions. (a) The meanings of defined
terms are equally applicable to the singular and plural forms of the defined
terms.
(b) The words "hereof," "herein," "hereunder" and similar words
refer to this Agreement as a whole and not to any particular provision of this
Agreement; and subsection, Section, Article, Schedule and Exhibit references are
to this Agreement unless otherwise specified.
(c)(i) The term "documents" includes any and all instruments,
documents, agreements, certificates, indentures, notices and other writings,
however evidenced.
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(ii) The term "including" is not limiting and means "including
without limitation."
(iii) In the computation of periods of time from a specified date to
a later specified date, the word "from" means "from and including"; the words
"to" and "until" each mean "to but excluding," and the word "through" means "to
and including."
(d) Unless otherwise expressly provided herein, (i) references to
agreements (including this Agreement) and other contractual instruments shall be
deemed to include all subsequent amendments and other modifications thereto, but
only to the extent such amendments and other modifications are not prohibited by
the terms of any Loan Document, and (ii) references to any statute or regulation
are to be construed as including all statutory and regulatory provisions
consolidating, amending, replacing, supplementing or interpreting the statute or
regulation.
(e) The captions and headings of this Agreement are for convenience
of reference only and shall not affect the interpretation of this Agreement.
(f) This Agreement and other Loan Documents may use several
different limitations, tests or measurements to regulate the same or similar
matters. All such limitations, tests and measurements are cumulative and shall
each be performed in accordance with their terms.
(g) This Agreement and the other Loan Documents are the result of
negotiations among and have been reviewed by counsel to the Agents, the
Borrowers and the other parties, and are the products of all parties.
Accordingly, they shall not be construed against the Lenders or any Agent merely
because of an Agent's or Lenders' involvement in their preparation.
1.3. Accounting Principles. (a) Unless the context otherwise clearly
requires, all accounting terms not expressly defined herein shall be construed,
and all financial computations required under this Agreement shall be made, in
accordance with GAAP, consistently applied; provided, however, that if the
Borrowers notify the Arranger that the Borrowers wish to amend any covenant in
Article VIII to eliminate the effect of any change in GAAP on the operation of
such covenant (or if the Arranger notifies the Borrowers that the Required
Lenders wish to amend Article VIII for such purpose), then the Borrowers'
compliance with such covenant shall be determined on the basis of GAAP in effect
immediately before the relevant change in GAAP became effective, until either
such notice is withdrawn or such covenant is amended in a manner satisfactory to
the Borrowers and the Required Lenders.
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(b) References herein to "fiscal year" and "fiscal quarter" refer to
such fiscal periods of US Borrower.
1.4. Currency Equivalents Generally. For all purposes of any Loan or
other Credit Extension pursuant to this Agreement (but not for purposes of the
preparation of any financial statements delivered pursuant hereto), the
equivalent in any Offshore Currency or other currency of an amount in U.S.
Dollars, and the equivalent in U.S. Dollars of an amount in any Offshore
Currency or other currency, shall be determined at the Spot Rate. For purposes
of determining compliance with any restriction limited to a Dollar Equivalent
amount in this Agreement (other than to the extent relating to any Loan or other
Credit Extension under this Agreement), the Dollar Equivalent amount of
transactions occurring prior to the date of determination shall be calculated
based on the Spot Rate on the date of determination; provided, however, that if
such Dollar Equivalent amount shall be exceeded, such restriction shall
nonetheless be deemed not violated if such Dollar Equivalent amount of such
transactions was calculated based on the relevant currency exchange rate in
effect on the date of each such transaction.
1.5. Principle of Deemed Reinvestment. Except to the extent
permitted under applicable law, all calculations of interest and fees hereunder
are to be made on the basis of the nominal interest rate set forth herein and
not using the effective rate method of calculation or on any basis which gives
effect to the principle of deemed reinvestment.
ARTICLE II.
THE CREDITS
2.1. Amounts and Terms of Commitments. (a) Each Tranche A Lender
severally agrees, on the terms and conditions set forth herein, to make a single
loan to CH Borrower (each such loan, a "Tranche A Term Loan") on the Closing
Date in an amount not to exceed such Lender's Pro Rata Share of CHF 125.0
million. The Tranche A Facility Commitment of each Tranche A Lender is set forth
on Schedule 2.1 opposite such Lender's name under the heading "Tranche A
Commitments."
(b) Each Tranche B Lender severally agrees, on the terms and
conditions set forth herein, to make a single loan, in U.S. Dollars, to US
Borrower (each such loan, a "Tranche B Term Loan") on the Closing Date in an
amount not to exceed such Lender's Pro Rata Share of U.S. $75.0 million. The
Tranche B Commitment of each Tranche B Lender is set forth on Schedule 2.1
opposite such Lender's name under the heading "Tranche B Commitments."
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(c) Each Tranche C(CH) Lender severally agrees, on the terms and
conditions set forth herein, to make a loan, in U.S. Dollars, to CH Borrower
(each such loan, a "Tranche C(CH) Term Loan") on the Closing Date in an amount
not to exceed such Lender's Pro Rata Share of U.S. $32.0 million. The Tranche
C(CH) Commitment of each Tranche C(CH) Lender is set forth on Schedule 2.1
opposite such Lender's name under the heading "Tranche C(CH) Commitments." Each
Tranche C(US) Lender severally agrees, on the terms and conditions set forth
herein, to make a single loan, in U.S. Dollars, to US Borrower (each such loan,
a "Tranche C(US) Term Loan") on the Closing Date in an amount not to exceed such
Lender's Pro Rata Share of U.S. $40.0 million. The Tranche C(US) Commitment of
each Tranche C(US) Lender is set forth on Schedule 2.1 opposite such Lender's
name under the heading "Tranche C(US) Commitments."
(d) Each Revolving Facility Lender severally agrees, on the terms
and conditions set forth herein, to make loans to each of the Borrowers (each
such loan, a "Revolving Loan") from time to time on any Business Day during the
period from the Closing Date to the Termination Date, in an aggregate amount not
to exceed at any time outstanding the amount set forth opposite such Lender's
name under the heading "Revolving Facility Commitments" on Schedule 2.1 (such
amount, as reduced pursuant to Section 2.6 or changed as a result of one or more
assignments under Section 4.8 or 11.8, such Lender's "Revolving Facility
Commitment") and in such currencies as a Borrower may request pursuant to
subsection 2.3(a)(E); provided, however, that Borrowings of Revolving Loans on
the Closing Date shall in no event exceed the Dollar Equivalent amount of U.S.
$75.0 million; provided, further, however, that after giving effect to any
Borrowing of Revolving Loans, the aggregate principal Dollar Equivalent amount
of all outstanding Revolving Loans, plus the aggregate principal Dollar
Equivalent amount of all outstanding Swing Line Loans, plus (without
duplication) the Effective Amount of all L/C Obligations shall not exceed the
combined Revolving Facility Commitments of all Revolving Facility Lenders;
provided, further, still, however, that the Aggregate Outstanding Revolving
Credit of any Revolving Facility Lender shall not at any time exceed such
Lender's Revolving Facility Commitment. For purposes of making any Revolving
Loan other than a Revolving Loan pursuant to Section 2.18 and any Swing Line
Loan pursuant to Section 2.16 there shall be deemed to be outstanding at all
times Swing Line Loans in a minimum aggregate amount equal to the Assumed Swing
Line Loan Amount. Any Revolving Loan made under Section 2.18 shall be made by
each Revolving Facility Lender in an amount equal to its Pro Rata Share of the
Revolving Loan made thereunder, provided that no Revolving Facility Lender need
make such a Revolving Loan to the extent that the aggregate amount of Swing Line
Loans made to any Subsidiary Swing Line Borrower exceeds such Subsidiary Swing
Line Borrower's Subsidiary Swing Line Borrower Sublimit. Within the limits of
each Revolving Facility Lender's Revolving Facility Commitment, and subject to
the other terms and conditions hereof, each Borrower may borrow
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under this subsection 2.1(d), prepay under Section 2.7, and reborrow under this
subsection 2.1(d).
(e) Amounts which are borrowed as Term Loans which are repaid or
prepaid may not be reborrowed.
2.2. Notes. The applicable Borrower's and the applicable Subsidiary
Swing Line Borrower's obligation to pay the principal of, and interest on, all
the Loans made to it by each Lender shall be evidenced (i) if Tranche A Term
Loans, by a promissory note substantially in the form of Exhibit H-1, with
blanks appropriately completed (each, a "Tranche A Term Note" and, collectively,
the "Tranche A Term Notes"), (ii) if Tranche B Term Loans, by a promissory note
substantially in the form of Exhibit H-2, with blanks appropriately completed
(each, a "Tranche B Term Note" and, collectively, the "Tranche B Term Notes"),
(iii) if Tranche C(CH) Term Loans, by a promissory note substantially in the
form of Exhibit H-3, with blanks appropriately completed (each, a "Tranche C(CH)
Term Note" and, collectively, the "Tranche C(CH) Term Notes"), (iv) if Tranche
C(US) Term Loans, by a promissory note substantially in the form of Exhibit H-4,
with blanks appropriately completed (each, a "Tranche C(US) Term Note" and,
collectively, the "Tranche C(US) Term Notes"), (v) if Revolving Loans, by a
promissory note substantially in the form of Exhibit H-5, with blanks
appropriately completed (each, a "Revolving Note" and, collectively, the
"Revolving Notes"), and (vi) if Swing Line Loans, by a promissory note
substantially in the form of Exhibit H-6, with blanks appropriately completed
(each, a "Swing Line Note" and, collectively, the Swing Line Notes"). Each such
Lender shall make appropriate notations on the schedules annexed to the
applicable Note of the date, amount and maturity of each applicable Loan made by
it and the amount of each payment of principal made by the applicable Borrower
or Subsidiary Swing Line Borrower, as the case may be, with respect thereto.
Each such Lender is irrevocably authorized by the applicable Borrower or the
applicable Subsidiary Swing Line Borrower, as the case may be, to make such
notations on the applicable Note and each such Lender's record shall be
conclusive absent manifest error; provided, however, that the failure of a
Lender to make, or an error in making, a notation on any Note with respect to
any Loan shall not limit or otherwise affect the obligations of the applicable
Borrower or Subsidiary Swing Line Borrower, as the case may be, hereunder or
under such Note to such Lender.
2.3. Procedure for Committed Borrowings. (a) Each Committed
Borrowing (other than of a Swing Line Loan) shall be made upon the applicable
Borrower's irrevocable written notice (or telephonic notice promptly confirmed
in writing) delivered to the Administrative Agent in the form of a Notice of
Committed Borrowing (which notice must be received by the Administrative Agent
prior to (i) 10:00 a.m. (London, England time), three Business Days prior to the
requested Borrowing Date, in the case of Offshore Currency Loans; (ii) 10:00
a.m. (New York City time), three Business Days prior to the requested Borrowing
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Date, in the case of Offshore U.S. Dollar Loans; and (iii) 10:00 a.m. (New York
City time), one Business Day prior to the requested Borrowing Date, in the case
of ABR Loans, and in each case not more than five Business Days prior to the
requested Borrowing Date) specifying:
(A) the amount of the Committed Borrowing, which shall be in an
aggregate amount not less than the Minimum Tranche;
(B) the requested Borrowing Date, which shall be a Business Day;
(C) the Type of Loans comprising the Committed Borrowing;
(D) in the case of a Borrowing of LIBOR Rate Committed Loans, the
duration of the Interest Period therefor; and
(E) in the case of a Borrowing of Offshore Currency Loans, the
Applicable Currency.
(b) The Dollar Equivalent amount of any Borrowing of Revolving
Facility Loans in an Offshore Currency will be determined by the Administrative
Agent for such Borrowing on the Computation Date therefor in accordance with
subsection 2.5(a). Upon receipt of a Notice of Committed Borrowing, the
Administrative Agent will promptly notify each Lender thereof and of the amount
of such Lender's Pro Rata Share of the Committed Borrowing. In the case of a
Borrowing of Revolving Facility Loans comprised of Offshore Currency Loans, such
notice will provide the approximate amount of each Lender's Pro Rata Share of
the Borrowing, and the Administrative Agent will, upon the determination of the
Dollar Equivalent amount of the Borrowing as specified in the Notice of
Committed Borrowing, promptly notify each Lender of the exact amount of such
Lender's Pro Rata Share of the Borrowing.
(c) Each Lender will make the amount of its Pro Rata Share of
each Committed Borrowing available to the Administrative Agent for the account
of the applicable Borrower at the Administrative Agent's Payment Office on the
Borrowing Date requested by such Borrower in Same Day Funds and in the requested
currency (i) in the case of a Committed Borrowing comprised of Loans in U.S.
Dollars, by 11:00 a.m. (New York City time) and (ii) in the case of a Borrowing
comprised of Offshore Currency Loans, by such time (London, England time) as the
Administrative Agent may specify. The proceeds of all such Committed Loans will
promptly be made available to the applicable Borrower by the Administrative
Agent at such office by crediting the account of such Borrower where requested
by such Borrower with the aggregate of the amounts made available to the
Administrative Agent by the Lenders and in like funds as received by the
Administrative Agent.
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(d) After giving effect to any Committed Borrowing, there may not be
more than four different Interest Periods in effect for all Tranche A Term
Loans, four different Interest Periods in effect for all Tranche B Term Loans,
four different Interest Periods in effect for all Tranche C(CH) Term Loans, four
different Interest Periods in effect for all Tranche C(US) Term Loans and six
different Interest Periods in effect for all Revolving Loans. No more than four
different Applicable Currencies shall be utilized for all outstanding Revolving
Loans.
(e) ABR Loans shall only be made in U.S. Dollars.
2.4. Conversion and Continuation Elections for Committed Borrowings.
(a) The Borrowers may, upon irrevocable written notice to the Administrative
Agent in accordance with subsection 2.4(b):
(i) elect, as of any Business Day in the case of ABR Loans, or as of
the last day of the applicable Interest Period, in the case of Offshore
U.S. Dollar Loans, to convert any such Committed Loans (or any part
thereof in an amount not less than the Minimum Tranche) into Committed
Loans in U.S. Dollars of the other Type; or
(ii) elect, as of the last day of the applicable Interest Period, to
continue any Committed Loans having Interest Periods expiring on such day
(or any part thereof in an amount not less than the Minimum Tranche);
provided, however, that if at any time the aggregate amount of Offshore U.S.
Dollar Loans in respect of any Committed Borrowing is reduced, by payment,
prepayment or conversion of part thereof, to be less than the Minimum Tranche,
such Offshore U.S. Dollar Loans shall automatically convert into ABR Loans, and
on and after such date the right of the applicable Borrower to continue such
Committed Loans as, and convert such Committed Loans into, Offshore U.S. Dollar
Loans shall terminate unless and until such Committed Loans are increased, by
additional Borrowings or Conversions, to be at least the Minimum Tranche.
(b) The applicable Borrower shall deliver a Notice of
Conversion/Continuation to be received by the Administrative Agent not later
than (i) 10:00 a.m. (London, England time), three Business Days prior to
the Conversion/Continuation Date, if the Committed Loans are to be continued as
Offshore Currency Loans; (ii) 10:00 a.m. (New York City time), three Business
Days prior to the Conversion/Continuation Date, if the Committed Loans are to be
converted into or continued as Offshore U.S. Dollar Loans; and (iii) 10:00 a.m.
(New York City time), one Business Day prior to the Conversion/Continuation
Date, if the Committed Loans are to be converted into ABR Loans, and in each
case not more than five Business Days prior to the Conversion/Continuation Date,
specifying:
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(A) the proposed Conversion/Continuation Date;
(B) the aggregate amount and Type of Committed Loans to be converted
or continued;
(C) the Type of Committed Loans resulting from the proposed
conversion or continuation; and
(D) other than in the case of conversions into ABR Loans, the
duration of the requested Interest Period.
(c) If upon the expiration of any Interest Period applicable to
Offshore U.S. Dollar Loans, the applicable Borrower has failed to select timely
a new Interest Period to be applicable to such Offshore U.S. Dollar Loans, the
applicable Borrower shall be deemed to have elected to convert such Offshore
U.S. Dollar Loans into ABR Loans effective as of the expiration date of such
Interest Period. If the applicable Borrower has failed to select a new Interest
Period to be applicable to Offshore Currency Loans by the applicable time on the
third Business Day in advance of the expiration date of the current Interest
Period applicable thereto as provided in subsection 2.4(b), the applicable
Borrower shall be deemed to have elected to continue such Offshore Currency
Loans on the basis of a one month Interest Period.
(d) The Administrative Agent will promptly notify each Lender of its
receipt of a Notice of Conversion/Continuation pursuant to this Section 2.4, or,
if no timely notice is provided by the applicable Borrower, the Administrative
Agent will promptly notify each Lender of the details of any automatic
conversion. All conversions and continuations shall be made ratably according to
the respective outstanding principal amounts of the Committed Loans held by each
Lender with respect to which the notice was given.
(e) Unless the Required Lenders otherwise agree or otherwise as
permitted hereby, during the existence of an Event of Default or Unmatured Event
of Default, no Borrower may elect to have a Committed Loan converted into an
Offshore U.S. Dollar Loan or continued as a LIBOR Rate Committed Loan.
(f) After giving effect to any conversion or continuation of
Committed Loans, there may not be more than four different Interest Periods in
effect for all Tranche A Term Loans, four different Interest Periods in effect
for all Tranche B Term Loans, four different Interest Periods in effect for all
Tranche C(CH) Term Loans, four different Interest Periods in effect for all
Tranche C(US) Term Loans and six different Interest Periods in effect for all
Revolving Loans.
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2.5. Utilization of Commitments in Offshore Currencies. (a) The
Administrative Agent will determine the Dollar Equivalent amount with respect
to:
(i) any Borrowing comprised of Offshore Currency Loans three
Business Days prior to the requested Borrowing Date,
(ii) any Swing Line Loans made in U.S. Dollars or Pounds Sterling,
as of the proposed Borrowing Date thereof,
(iii) any Issuance of a Letter of Credit in an Offshore Currency as
of the requested Issuance Date,
(iv) any drawing under a Letter of Credit in an Offshore Currency as
of the related Honor Date,
(v) all outstanding Offshore Currency Loans (other than Swing Line
Loans not made in U.S. Dollars or Pounds Sterling), Swing Line Loans made in
U.S. Dollars or Pounds Sterling and L/C Obligations as of the last Business Day
of each month and as of any other date selected by the Administrative Agent,
(vi) the aggregate Dollar Equivalent amount of the Subsidiary Swing
Line Borrower Sublimits of all Subsidiary Swing Line Borrowers other than M-T
Leicester as of each Adjustment Date,
(vii) any ABR Loan to be made in lieu of an Offshore Currency Loan
pursuant to subsection 2.5(b) as of the Business Day prior to the proposed
Borrowing Date and
(viii) any outstanding Offshore Currency Loan as of any
redenomination date pursuant to this Section 2.5 or Section 4.5, and
(ix) all Offshore Currency Loans and L/C Obligations on any date on
which the Revolving Facility Commitments, the US Borrower Sublimit or the
Subsidiary Swing Line Borrower Sublimits are reduced pursuant to Section 2.6.
(b) In the case of a proposed Borrowing (other than of Swing Line
Loans) under the Revolving Facility comprised of Offshore Currency Loans, in the
event that any Revolving Facility Lender gives notice to the Administrative
Agent not later than 10:00 a.m. (London, England time) one Business Day prior to
the proposed Borrowing Date that it is unable to fund Revolving Facility Loans
in an Offshore Currency at a reasonable cost to it, such Lender shall make its
Pro Rata Share of the proposed Borrowing as an ABR Loan in the Dollar
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Equivalent amount of the amount it otherwise would have made in such Offshore
Currency; provided, however, that the Lenders shall be under no obligation to
make Offshore Currency Loans in the requested Offshore Currency as part of such
Borrowing if the Administrative Agent has received notice from the Required
Revolving Facility Lenders by 10:00 a.m. (London, England time), three Business
Days prior to the day of such Borrowing, that such Lenders cannot provide Loans
in the requested Offshore Currency, in which event the Administrative Agent will
promptly give notice to the applicable Borrower that the Borrowing in the
requested Offshore Currency is not then available, and notice thereof also will
be given promptly by the Administrative Agent to the Lenders. If the
Administrative Agent shall have so notified the applicable Borrower that,
pursuant to any such notice from the Required Revolving Facility Lenders, any
such Borrowing in a requested Offshore Currency is not then available, such
Borrower may, by notice to the Administrative Agent not later than 10:00 a.m.
(London, England time), on the requested date of such Borrowing, withdraw the
Notice of Committed Borrowing relating to such requested Borrowing. If such
Borrower does so withdraw such Notice of Committed Borrowing, the Borrowing
requested therein shall not occur and the Administrative Agent will promptly so
notify each Lender. If such Borrower does not so withdraw such Notice of
Committed Borrowing, the Administrative Agent will promptly so notify each
Lender and such Notice of Committed Borrowing shall be deemed to be a Notice of
Committed Borrowing that requests a Borrowing comprised of ABR Loans in an
aggregate amount equal to the Dollar Equivalent of the amount of the originally
requested Borrowing in the Notice of Committed Borrowing (however, not in excess
of the aggregate Available Revolving Facility Commitment of all Revolving
Facility Lenders at such time); and in such notice by the Administrative Agent
to each Lender the Administrative Agent will state such aggregate amount of such
Borrowing in U.S. Dollars and such Lender's Pro Rata Share thereof.
(c) In the case of a proposed continuation of Offshore Currency
Loans under the Revolving Facility for an additional Interest Period pursuant to
Section 2.4, in the event that any Revolving Facility Lender gives notice to the
Administrative Agent that it is unable to continue Revolving Facility Loans in
an Offshore Currency at a reasonable cost to it, such Lender's Loans in such
Offshore Currency shall be repaid on the last day of the current Interest
Period; provided, however, that the Lenders shall be under no obligation to
continue such Offshore Currency Loans if the Administrative Agent has received
notice from the Required Revolving Facility Lenders by 10:00 a.m. (London,
England time), three Business Days prior to the day of such continuation, that
such Lenders cannot continue to provide Loans in the relevant Offshore Currency,
in which event the Administrative Agent will promptly give notice to the
applicable Borrower that the continuation of such Offshore Currency Loans in the
relevant Offshore Currency is not then available, and notice thereof also will
be given promptly by the Administrative Agent to the Lenders. If the
Administrative Agent shall have so notified such Borrower that, pursuant to such
notice from the Required Revolving Facility Lenders, any such continuation of
Offshore Currency Loans is not then available, any Notice of
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Continuation/Conversion with respect thereto shall be deemed withdrawn and such
Offshore Currency Loans shall be repaid on the last day of the Interest Period
with respect to such Offshore Currency Loans.
(d) Notwithstanding anything herein to the contrary, during the
existence of an Event of Default, upon the request of the Required Revolving
Facility Lenders (in the case of clause (i) of this subsection) or the Lenders
holding at least a majority of the Tranche A Term Loans (in the case of clause
(ii) of this subsection), (i) all or any part of any outstanding LIBOR Rate
Committed Loans under the Revolving Facility shall be redenominated (if not
Offshore U.S. Dollar Loans) and converted into ABR Loans with effect from the
last day of the Interest Period with respect to such LIBOR Rate Committed Loans,
and (ii) at the end of the current Interest Period therefor, each Tranche A Term
Loan shall not be continued for any Interest Period but instead shall bear
interest at a rate per annum equal to the Applicable Margin for Tranche A Term
Loans, plus the Overnight Rate for the Applicable Currency from time to time in
effect or such other rate as may be agreed to by CH Borrower and the Lenders
holding at least a majority of the Tranche A Term Loans and specified to the
Administrative Agent. The Administrative Agent will promptly notify the
applicable Borrower of any request pursuant to the foregoing sentence.
(e) The Borrowers shall be entitled to request that Revolving
Facility Loans hereunder also be permitted to be made in any other lawful
currency constituting a eurocurrency, in addition to the eurocurrencies
specified in the definition of "Offshore Currency" herein, that in the opinion
of the Required Revolving Facility Lenders is at such time freely traded in the
offshore interbank foreign exchange markets and is freely transferable and
freely convertible into U.S. Dollars (an "Agreed Alternative Currency"). The
applicable Borrower shall deliver to the Administrative Agent any request for
designation of an Agreed Alternative Currency not later than 10:00 a.m. (London,
England time), at least ten Business Days in advance of the date of any
Borrowing hereunder proposed to be made in such Agreed Alternative Currency.
Upon receipt of any such request the Administrative Agent will promptly notify
the Revolving Facility Lenders thereof, and each Lender will use its best
efforts to respond to such request within two Business Days of receipt thereof.
If the Administrative Agent has not received any response from a Revolving
Facility Lender by the end of the day four Business Days prior to the date of
Borrowing to be made in such Agreed Alternative Currency, the Administrative
Agent shall conclusively presume the assent of such Lender. Each Revolving
Facility Lender may grant or accept such request in its sole discretion. The
Administrative Agent will promptly notify the applicable Borrower of the
acceptance or rejection of any such request.
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2.6. Reduction or Termination of Commitments. (a) The Borrowers may,
upon not less than five Business Days' prior notice to the Administrative Agent,
terminate the Commitments in any Facility, or permanently reduce the Commitments
in any Facility by an aggregate amount equal to the Dollar Equivalent of U.S.
$1.0 million or a higher integral multiple of U.S. $1.0 million; unless, in the
case of the Revolving Facility, after giving effect thereto and to any
prepayments of the Revolving Facility Loans made on the effective date of such
termination or reduction, the then outstanding principal Dollar Equivalent
amount of all Revolving Facility Loans (including the Assumed Swing Line Loan
Amount), plus (without duplication) the Effective Amount of all L/C Obligations
together would exceed the amount of the combined Revolving Facility Commitments
of all Revolving Facility Lenders then in effect. The Borrowers may, upon not
less than five Business Days' prior notice to the Administrative Agent and the
Applicable Swing Line Lender, terminate or permanently reduce the Subsidiary
Swing Line Borrower Sublimit of any of the Subsidiary Swing Line Borrowers or
the US Borrower Sublimit; unless, after giving effect thereto and to any
prepayment of the Swing Line Loans made on the effective date of such
termination or reduction the then outstanding Dollar Equivalent amount of all
Swing Line Loans would exceed the amount of the Subsidiary Swing Line Borrower
Sublimits then in effect, plus the US Borrower Sublimit then in effect.
(b) The Commitments relating to each Term Loan Facility shall
automatically and permanently expire concurrently with the making of the Term
Loans thereunder on the Closing Date.
(c) Once reduced in accordance with this Section, the Commitments
may not be increased. Any reduction of the Commitments in any Facility shall be
applied to each Lender's Commitment in such Facility according to its Pro Rata
Share. All accrued Facility Fees in respect of any Facility to, but not
including, the effective date of any reduction or termination of Commitments in
such Facility shall be paid on the effective date of such reduction or
termination.
2.7. Prepayments. (a) So long as any Term Loans are outstanding,
within 20 days following each date on which US Borrower or any Subsidiary
receives any Net Cash Proceeds from any Taking or Destruction or loss of title
to any Mortgaged Real Property, a Dollar Equivalent amount equal to 100% of such
Net Cash Proceeds shall be applied as a mandatory prepayment of principal of the
Term Loans; provided, however, that so long as no Event of Default or Unmatured
Event of Default then exists and such proceeds do not exceed the Dollar
Equivalent amount of U.S. $10.0 million, such proceeds shall not be required to
be so applied on such date to the extent that the Borrowers have delivered an
Officers' Certificate to the Administrative Agent on or prior to such date
stating that such proceeds shall be used to replace or restore (in accordance
with the procedures set forth in the Mortgage) any properties or assets in
respect of which such proceeds were paid within 360 days following the date of
the
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receipt of such proceeds (which certificate shall set forth the estimates of the
proceeds to be so expended); provided, further, however, that (i) if the amount
of such proceeds exceeds the Dollar Equivalent amount of U.S. $10.0 million,
then the entire amount and not just the portion in excess of the Dollar
Equivalent amount of U.S. $10.0 million shall be applied as a mandatory
prepayment of Term Loans as provided above in this subsection 2.7(a) and (ii) if
all or any portion of such proceeds not required to be applied to the prepayment
of Term Loans pursuant to the preceding proviso are not so used within 360 days
after the date of the receipt of such proceeds, such remaining portion shall be
applied on the last day of such period (or the next preceding Business Day if
such last day is not a Business Day) as a mandatory prepayment of principal of
the Term Loans as provided above in this subsection 2.7(a). Each such prepayment
shall be applied as set forth in subsection 2.7(f).
(b) So long as any Term Loans are outstanding, within 90 days after
the end of each fiscal year of US Borrower ending after December 31, 1996, the
Borrowers shall prepay the Term Loans in a Dollar Equivalent amount equal to 75%
of Excess Cash Flow for such fiscal year; provided, however, that if the Debt to
EBITDA Ratio as of the end of the fiscal year immediately preceding the date of
any such prepayment is less than 3.50 to 1.0, such percentage shall be 50%. Each
such prepayment shall be applied as set forth in subsection 2.7(f).
(c) So long as any Term Loans are outstanding, within 30 days after
the receipt by US Borrower or any Subsidiary of Net Cash Proceeds from any Asset
Sale, the Borrowers shall prepay the Term Loans in a Dollar Equivalent amount
equal to 100% of the Net Cash Proceeds of such Asset Sale; provided, however,
that the Net Cash Proceeds from any Asset Sale permitted by each of subsection
8.2(d) and subsection 8.2(i) shall in each case not be required to be so applied
to the prepayment of the Term Loans on such date if (i) no Event of Default or
Unmatured Event of Default then exists and (ii) the Borrowers deliver an
Officers' Certificate to the Administrative Agent on or prior to such date
stating that such Net Cash Proceeds shall be reinvested in the business of the
Borrowers within 180 days following the date of such Asset Sale (which
certificate shall set forth the estimates of the proceeds to be so expended);
provided, further, however, that if all or any portion of such Net Cash Proceeds
not so applied to the prepayment of Term Loans is not so used within such 180
day period, such remaining portion shall be applied on the last day of such
period (or the next preceding Business Day if such last day is not a Business
Day) as a mandatory prepayment of principal of outstanding Term Loans as
provided above in this subsection 2.7(c). Each such prepayment shall be applied
as set forth in subsection 2.7(f).
(d) So long as any Term Loans are outstanding, the Borrowers shall
prepay the Term Loans concurrently with the receipt of any Net Cash Proceeds
from the issuance of any Indebtedness by US Borrower or any Subsidiary (other
than any Indebtedness permitted by
<PAGE>
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Section 8.5) in a Dollar Equivalent amount equal to 100% of such Net Cash
Proceeds. Each such prepayment shall be applied as set forth in subsection
2.7(f).
(e) So long as any Term Loans are outstanding, the Borrowers shall
prepay the Term Loans concurrently with the receipt of any Net Cash Proceeds
from any capital contribution to US Borrower or any Subsidiary or from the
issuance or sale of any equity securities of MT Investors, Holding or any of its
Subsidiaries or any other direct or indirect parent of US Borrower (other than
(x) the Equity Issuance, (y) the exercise of employee stock options and the
repayment of loans to employees and (z) in each case, contributions from or
issuances to another Company) in a Dollar Equivalent amount equal to 50% of such
Net Cash Proceeds; provided, however, that no such prepayment shall be required
in connection with the issuance or sale by Holding of any equity securities of
Holding to the Investors or from the proceeds of any capital contribution
therefrom to US Borrower or any Subsidiary in an aggregate amount of Net Cash
Proceeds up to the Dollar Equivalent amount of U.S. $35.0 million since the
Closing Date (over and above the Equity Issuance) if (i) no Event of Default or
Unmatured Event of Default then exists and (ii) such Net Cash Proceeds are
contemporaneously utilized by US Borrower and the Subsidiaries in their
business; provided, further, however, that such Net Cash Proceeds are not
utilized by US Borrower or any Subsidiary, directly or indirectly, to redeem,
retire or acquire any other Indebtedness of US Borrower or any Subsidiary. Each
such prepayment shall be applied as set forth in subsection 2.7(f).
(f) Each prepayment of the Term Loans required by subsections
(a)-(e) of this Section 2.7 shall be applied pro rata among the Term Loan
Facilities (based on the then remaining amounts of the Amortization Payments of
the Term Loan Facilities) and, as to each Term Loan Facility, first, to the next
immediately succeeding scheduled quarterly Amortization Payment of such Term
Loan Facility as set forth in the relevant subsection of Section 2.9 and,
second, pro rata to the remaining Amortization Payments under such Term Loan
Facility as set forth in the relevant subsection of Section 2.9. Subject to
subsection 2.10(b), all prepayments of Term Loans shall be made together with
all accrued interest thereon and any amounts required by Section 4.4, and all
such payments shall be applied to the payment of interest and such Section 4.4
amounts before application to principal. Notwithstanding the foregoing, in
respect of any partial prepayment of Term Loans pursuant to any of subsection
(a)-(e) of this Section 2.7 any Lender having a Tranche B Term Loan or a Tranche
C Term Loan may irrevocably decline receipt of its share of any such prepayment,
and, if such Lender so declines, such share shall be applied as an additional
prepayment of the Tranche A Term Loans, each such additional prepayment to be
applied pro rata to the remaining Amortization Payments under such Term Loan
Facility as set forth in Section 2.9, subject, however, to clause (iii) of
subsection 2.7(h). If the amount to be so applied to Tranche A Term Loans
exceeds the amount of the Tranche A Term Loans then outstanding, no prepayment
shall be required with respect to the amount of such excess. The Administrative
Agent will promptly notify the Lenders of any
<PAGE>
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prepayment required to be made. Any such Lender that wishes to decline receipt
of its share of any such prepayment shall promptly, and in any event no later
than the date specified for such prepayment, notify the Administrative Agent.
(g) Subject to Section 4.4, either Borrower may, at any time or from
time to time, ratably prepay, without premium or penalty, Committed Loans under
the Revolving Loan Facility or under the Term Loan Facilities in whole or in
part, in an aggregate Dollar Equivalent principal amount of at least U.S. $1.0
million and a higher integral multiple of 1.0 million units of the Applicable
Currency. The applicable Borrower shall deliver a notice of prepayment in
accordance with Section 11.2 to be received by the Administrative Agent not
later than (i) 10:00 a.m. (London, England time), three Business Days in advance
of the prepayment date, if the Committed Loans to be prepaid are LIBOR Rate
Committed Loans, and (ii) 10:00 a.m. (New York City time), one Business Day
prior to the prepayment date, if the Committed Loans to be prepaid are ABR Loans
(and in each case on not more than five Business Days' prior notice). Such
notice of prepayment shall specify the date and amount of such prepayment and
whether such prepayment is of ABR Loans, LIBOR Rate Committed Loans, or any
combination thereof, whether Revolving Loans or Term Loans are being prepaid and
the Applicable Currency. Such notice shall not thereafter be revocable by the
Borrowers. The Administrative Agent will promptly notify each Lender thereof and
of such Lender's Pro Rata Share of such prepayment. If such notice is given by a
Borrower, such Borrower shall make such prepayment and the payment amount
specified in such notice shall be due and payable on the date specified therein,
together with accrued interest to each such date on the amount prepaid and any
amounts required pursuant to Section 4.4. Each such prepayment (if a prepayment
of Term Loans) shall be applied pro rata among the Term Loan Facilities (based
on the then remaining amounts of the Amortization Payments of the Term Loan
Facilities) and, as to each Term Loan Facility, first, to the next immediately
succeeding scheduled quarterly Amortization Payment of such Term Loan Facility
and, second, pro rata to the then remaining amounts of the Amortization Payments
under such Term Loan Facility, subject, however, to clause (iii) of subsection
2.7(h). Notwithstanding the foregoing, in respect of any partial prepayment of
Term Loans pursuant to this subsection 2.7(g), any Lender having a Tranche B
Term Loan or a Tranche C Term Loan may decline receipt of its share of any such
prepayment, and, if such Lender so declines, such share shall be applied as an
additional prepayment of the Tranche A Term Loans, each such additional
prepayment to be applied pro rata to the remaining Amortization Payments under
such Term Loan Facility; provided, however, that any excess of such prepayment
over the amount of outstanding Tranche A Term Loans may, at the option of the
Borrowers, nonetheless be applied to the prepayment of the Tranche B Term Loans
and Tranche C Term Loans. The Administrative Agent will promptly notify the
Lenders of any prepayment so to be made. Any such Lender that wishes to decline
receipt of its share of any such prepayment shall promptly, and in any event no
later than the date specified for such prepayment, notify the Administrative
Agent.
<PAGE>
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(h) With respect to each prepayment of Loans pursuant to Section
2.7, the Borrowers may designate the Types of Loans which are to be repaid and
the specific Borrowing(s) under the affected Facility pursuant to which made;
provided, however, that (i) LIBOR Rate Committed Loans made pursuant to a
specific Facility may be designated for prepayment only on the last day of an
Interest Period applicable thereto unless all LIBOR Rate Committed Loans made
pursuant to such Facility with Interest Periods ending on such date of
prepayment and all ABR Loans made pursuant to such Facility have been paid in
full; (ii) if any prepayment of LIBOR Rate Committed Loans made pursuant to a
single Borrowing shall reduce the outstanding Loans made pursuant to such
Borrowing to an amount less than the Minimum Tranche, such Borrowing shall be
immediately converted into, if such Borrowing is Offshore U.S. Dollar Loans, ABR
Loans and, if Offshore Currency Loans, Offshore Currency Loans having an
Interest Period of one month; and (iii) each repayment of any Loans made
pursuant to a Borrowing shall be applied pro rata among such Loans, unless a
Borrower shall have become obligated to make any payment pursuant to Section
4.1, in which case such Borrower may prepay the Loans held solely by the Lender
or Lenders to which it is obligated to make such payment. In the absence of a
designation by the Borrowers as described in the preceding sentence, the
Administrative Agent shall, subject to the above, make such designation in its
sole discretion with a view, but no obligation, to minimize funding losses owing
under Section 4.4.
(i) Notwithstanding subsections 2.7(a) and (c), to the extent that
the Net Cash Proceeds required to be applied to a prepayment of the Loans
pursuant to such subsections (1) are prohibited or delayed by applicable law
from being repatriated to the jurisdiction of the Borrower required to make any
such prepayment or (2) may not be so repatriated without causing an adverse tax
consequence, such Net Cash Proceeds required to be applied to a prepayment of
the Loans pursuant to such subsections shall, so long as no Event of Default or
Unmatured Event of Default has occurred and is continuing, not be required to be
applied as a prepayment of the Loans at the time provided in such subsections to
the extent that the aggregate Dollar Equivalent amount of Net Cash Proceeds
proposed to be not so applied for such event when added to the aggregate Dollar
Equivalent amount of Net Cash Proceeds from all prior or concurrent events which
have not been applied by virtue of this subsection 2.7(i) is less than 5.0% of
Net Tangible Assets at such time. If and when such repatriation is permitted
under the applicable local law or may be made without an adverse tax
consequence, as the case may be, such repatriation shall be immediately effected
and such Net Cash Proceeds shall be applied in the manner set forth in
subsections 2.7(a) and (c), with any time limit therein being deemed to have
started upon receipt of such Net Cash Proceeds by any Subsidiary of US Borrower
notwithstanding this subsection 2.7(i); provided, however, if the time limit
shall have expired, then such Net Cash Proceeds so repatriated shall be applied
to the prepayment of the Term Loans as set forth in subsection 2.7(f) within
three Business Days.
<PAGE>
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(j) On the last Business Day of each month occurring after October
31, 1996, the Borrowers and the Subsidiary Swing Line Borrowers shall determine
the aggregate Dollar Equivalent amount of the total amount of Swing Line Loans
actually outstanding (the date of each such determination, the "Swing Line Loan
Calculation Date"). The Swing Line Borrowers shall repay the Swing Line Loans
within 10 Business Days of any Swing Line Loan Calculation Date if the aggregate
Dollar Equivalent amount of Swing Line Loans then outstanding exceeds U.S. $25.0
million in an amount equal to the amount such that after giving effect thereto
the Dollar Equivalent amount of all Swing Line Loans then outstanding would not
exceed U.S. $25.0 million.
2.8. Currency Exchange Fluctuations. (a) The Borrowers and the
Subsidiary Swing Line Borrowers will implement and maintain internal controls to
monitor the borrowings and repayments of Loans by the Borrowers and the
Subsidiary Swing Line Borrowers and the issuance of and drawings under Letters
of Credit, with the object of preventing any request for a Credit Extension that
would result in (i) the Aggregate Outstanding Revolving Credit with respect to
all of the Revolving Facility Lenders (including the Swing Line Lenders) being
in excess of the aggregate Revolving Facility Commitments then in effect or (ii)
the Subsidiary Swing Line Borrowers exceeding their respective Subsidiary Swing
Line Borrower Sublimits and of promptly identifying and remedying any
circumstance where, by reason of changes in exchange rates, the Aggregate
Outstanding Revolving Credit with respect to all of the Revolving Facility
Lenders (including the Swing Line Lenders) exceeds the aggregate Revolving
Facility Commitments then in effect or the aggregate Swing Line Loans made to
any Subsidiary Swing Line Borrower exceeds its Subsidiary Swing Line Borrower
Sublimit.
(b) Subject to Section 4.4, if on any Computation Date the
Administrative Agent shall have determined that the Aggregate Outstanding
Revolving Credit of all of the Revolving Facility Lenders exceeds the combined
Revolving Facility Commitments of all Revolving Facility Lenders by more than
the Dollar Equivalent amount of U.S. $5.0 million due to a change in applicable
rates of exchange between U.S. Dollars, on the one hand, and Offshore
Currencies, on the other hand, then the Administrative Agent shall give notice
to the Borrowers that a prepayment of Loans (or, if no Revolving Credit Loans
are outstanding, payment of unreimbursed drawings under Letters of Credit, or if
none thereof, Cash Collateralization of outstanding Letters of Credit) is
required under this subsection, and the Borrowers and the Subsidiary Swing Line
Borrowers agree if such excess shall not have been prepaid within 30 days of
such notice or during such 30 days such excess has not been eliminated by
changes in currency exchange rates thereupon to make prepayments (by such
repayment of Loans, payment of unreimbursed drawings or Cash Collateralization)
of their respective pro rata portion of such excess (determined by reference to
the aggregate Dollar Equivalent amount of each Borrower's outstanding Revolving
Facility Loans, plus (without duplication) the Effective Amount of all L/C
Obligations relative to the total of such amounts for both Borrowers) such that,
after giving
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effect to such prepayment (or payment or Cash Collateralization and changes in
currency exchange rates), the Aggregate Outstanding Revolving Credit of all of
the Revolving Lenders does not exceed the combined Revolving Facility
Commitments of all Revolving Facility Lenders.
2.9. Repayment. (a) US Borrower shall repay the Tranche B Term Loans
and the Tranche C(US) Term Loans on the Business Day immediately prior to the
dates set forth below in the installments as set forth below:
================================================================================
Tranche B Tranche C (US)
Term Loans Term Loans
Date (U.S. $) (U.S. $)
================================================================================
March 31, 1997 187,500 100,000
- --------------------------------------------------------------------------------
June 30, 1997 187,500 100,000
- --------------------------------------------------------------------------------
September 30, 1997 187,500 100,000
- --------------------------------------------------------------------------------
December 31, 1997 187,500 100,000
- --------------------------------------------------------------------------------
March 31, 1998 187,500 100,000
- --------------------------------------------------------------------------------
June 30, 1998 187,500 100,000
- --------------------------------------------------------------------------------
September 30, 1998 187,500 100,000
- --------------------------------------------------------------------------------
December 31, 1998 187,500 100,000
- --------------------------------------------------------------------------------
March 31, 1999 187,500 100,000
- --------------------------------------------------------------------------------
June 30, 1999 187,500 100,000
- --------------------------------------------------------------------------------
September 30, 1999 187,500 100,000
- --------------------------------------------------------------------------------
December 31, 1999 187,500 100,000
- --------------------------------------------------------------------------------
March 31, 2000 187,500 100,000
- --------------------------------------------------------------------------------
June 30, 2000 187,500 100,000
- --------------------------------------------------------------------------------
September 30, 2000 187,500 100,000
- --------------------------------------------------------------------------------
December 31, 2000 187,500 100,000
- --------------------------------------------------------------------------------
March 31, 2001 187,500 100,000
- --------------------------------------------------------------------------------
June 30, 2001 187,500 100,000
- --------------------------------------------------------------------------------
September 30, 2001 187,500 100,000
- --------------------------------------------------------------------------------
<PAGE>
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================================================================================
Tranche B Tranche C (US)
Term Loans Term Loans
Date (U.S. $) (U.S. $)
================================================================================
December 31, 2001 187,500 100,000
- --------------------------------------------------------------------------------
March 31, 2002 3,062,500 100,000
- --------------------------------------------------------------------------------
June 30, 2002 3,062,500 100,000
- --------------------------------------------------------------------------------
September 30, 2002 3,062,500 100,000
- --------------------------------------------------------------------------------
December 31, 2002 3,062,500 100,000
- --------------------------------------------------------------------------------
March 31, 2003 14,750,000 100,000
- --------------------------------------------------------------------------------
June 30, 2003 14,750,000 100,000
- --------------------------------------------------------------------------------
September 30, 2003 14,750,000 100,000
- --------------------------------------------------------------------------------
December 31, 2003 14,750,000 100,000
- --------------------------------------------------------------------------------
March 31, 2004 -- 9,300,000
- --------------------------------------------------------------------------------
June 30, 2004 -- 9,300,000
- --------------------------------------------------------------------------------
September 30, 2004 -- 9,300,000
- --------------------------------------------------------------------------------
December 31, 2004 -- 9,300,000
================================================================================
(b) CH Borrower shall repay the Tranche A Term Loans and the
Tranche C(CH) Term Loans on the Business Day immediately prior to the dates set
forth below in the installments set forth below:
================================================================================
Tranche A Tranche C (CH)
Term Loans Term Loans
Date (CHF) (U.S. $)
================================================================================
March 31, 1997 2,500,000 100,000
- --------------------------------------------------------------------------------
June 30, 1997 2,500,000 100,000
- --------------------------------------------------------------------------------
September 30, 1997 2,500,000 100,000
- --------------------------------------------------------------------------------
December 31, 1997 2,500,000 100,000
- --------------------------------------------------------------------------------
March 31, 1998 3,750,000 100,000
- --------------------------------------------------------------------------------
<PAGE>
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================================================================================
Tranche A Tranche C (CH)
Term Loans Term Loans
Date (CHF) (U.S. $)
================================================================================
June 30, 1998 3,750,000 100,000
- --------------------------------------------------------------------------------
September 30, 1998 3,750,000 100,000
- --------------------------------------------------------------------------------
December 31, 1998 3,750,000 100,000
- --------------------------------------------------------------------------------
March 31, 1999 4,687,500 100,000
- --------------------------------------------------------------------------------
June 30, 1999 4,687,500 100,000
- -------------------------------------------------------------------------------
September 30, 1999 4,687,500 100,000
- --------------------------------------------------------------------------------
December 31, 1999 4,687,500 100,000
- --------------------------------------------------------------------------------
March 31, 2000 5,937,500 100,000
- --------------------------------------------------------------------------------
June 30, 2000 5,937,500 100,000
- --------------------------------------------------------------------------------
September 30, 2000 5,937,500 100,000
- --------------------------------------------------------------------------------
December 31, 2000 5,937,500 100,000
- --------------------------------------------------------------------------------
March 31, 2001 7,187,500 100,000
- --------------------------------------------------------------------------------
June 30, 2001 7,187,500 100,000
- --------------------------------------------------------------------------------
September 30, 2001 7,187,500 100,000
- --------------------------------------------------------------------------------
December 31, 2001 7,187,500 100,000
- --------------------------------------------------------------------------------
March 31, 2002 7,187,500 100,000
- --------------------------------------------------------------------------------
June 30, 2002 7,187,500 100,000
- --------------------------------------------------------------------------------
September 30, 2002 7,187,500 100,000
- --------------------------------------------------------------------------------
December 31, 2002 7,187,500 100,000
- --------------------------------------------------------------------------------
March 31, 2003 -- 100,000
- --------------------------------------------------------------------------------
June 30, 2003 -- 100,000
- --------------------------------------------------------------------------------
September 30, 2003 -- 100,000
- --------------------------------------------------------------------------------
December 31, 2003 -- 100,000
- --------------------------------------------------------------------------------
March 31, 2004 -- 7,300,000
- --------------------------------------------------------------------------------
June 30, 2004 -- 7,300,000
- --------------------------------------------------------------------------------
September 30, 2004 -- 7,300,000
- --------------------------------------------------------------------------------
<PAGE>
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================================================================================
Tranche A Tranche C (CH)
Term Loans Term Loans
Date (CHF) (U.S. $)
================================================================================
December 31, 2004 -- 7,300,000
================================================================================
(c) Each Amortization Payment as set forth above in subsections
2.9(a) and (b) shall be automatically adjusted upon application of any
prepayment pursuant to Section 2.7.
(d) Revolving Credit Extension Reductions. Until the Revolving Loan
Maturity Date, the Borrowers and the Subsidiary Swing Line Borrowers shall from
time to time immediately prepay the Revolving Facility Loans (and/or provide
cover for L/C Obligations as specified in subsection 2.9(e)) in such amounts as
shall be necessary so that at all times the Aggregate Outstanding Revolving
Credit of all of the Revolving Facility Lenders shall not (other than as a
result of a change in currency exchange rates) exceed the Revolving Facility
Commitments of all of the Revolving Facility Lenders, such amount to be applied,
first, to Revolving Facility Loans outstanding and, second, as cover for L/C
Obligations outstanding as specified in subsection 2.9(e).
(e) Cover for L/C Obligations. In the event that the Borrowers and
the Subsidiary Swing Line Borrowers shall be required pursuant to subsection
2.9(d) to provide cover for L/C Obligations, the Borrowers and the Subsidiary
Swing Line Borrowers shall effect the same by paying to the Administrative Agent
immediately available funds in an amount equal to the required amount, which
funds shall be retained by the Administrative Agent pursuant to arrangements and
documentation reasonably satisfactory to the Administrative Agent as collateral
security in the first instance for the L/C Obligations until such time as all
Letters of Credit shall have been terminated and all of the L/C Obligations paid
in full.
(f) All outstanding Revolving Loans (including Swing Line Loans)
shall be repaid in full on the Revolving Loan Maturity Date.
2.10. Interest. (a) Each Committed Loan (other than any Non-U.S. $
Swing Line Loan) shall, except as otherwise provided herein, bear interest on
the outstanding principal amount thereof from the applicable Borrowing Date at a
rate per annum equal to (i) the LIBOR Rate or the Alternate Base Rate, as the
case may be (and subject to the Borrowers' right to convert to the other Type of
Committed Loans under Section 2.4), plus the Applicable Margin, plus, in the
case of Loans made in Pounds Sterling, the MLA Cost. Each Non-U.S. $ Swing Line
Loan shall bear interest at the rate per annum equal to (x) if such Loan is in
Pounds Sterling, the Overnight Rate from time to time in effect for Pounds
Sterling, plus the Applicable Margin, plus, the MLA Cost and (y) if such Loan is
in any other Offshore Currency, such rate
<PAGE>
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as is agreed to by the Applicable Swing Line Lender and the applicable Swing
Line Borrower, plus the Applicable Margin.
(b) Interest on each Loan shall be paid in arrears on each Interest
Payment Date. Interest shall also be paid on the date of any prepayment of Loans
pursuant to Section 2.7 for the portion of the Loans so prepaid; provided,
however, that in the event that any Term Loans that are ABR Loans are prepaid
pursuant to Section 2.7, interest accrued on such Loans shall be payable on the
next succeeding Interest Payment Date thereafter (or at final maturity, if
earlier).
(c) Notwithstanding subsections (a) and (b) of this Section, if any
amount of principal of or interest on any Loan, or any other amount payable
hereunder or under any other Loan Document, is not paid in full when due
(whether at stated maturity, by acceleration, demand or otherwise), the
Borrowers and/or the Subsidiary Swing Line Borrowers, as the case may be, agree,
to the extent permitted by applicable law, to pay interest on such unpaid
principal or other amount from the date such amount becomes due until the date
such amount is paid in full, after as well as before any entry of judgment
thereon, payable on demand, at a rate per annum equal to (i) in the case of
principal due in respect of any Loan prior to the end of an Interest Period
applicable thereto, the rate otherwise applicable to such Loan, plus 2%, and
(ii) in the case of any other amount, (x) if such amount is payable in U.S.
Dollars, the Alternate Base Rate from time to time in effect, plus 2% and (y) if
such amount is payable in a currency other than U.S. Dollars, the Overnight Rate
from time to time in effect, plus the Applicable Margin for LIBOR Rate Committed
Loans for Loans under the applicable Facility from time to time in effect, plus
2%, plus, in the case of Loans in Pounds Sterling, the MLA Cost.
(d) Anything herein to the contrary notwithstanding, the obligations
of the Borrowers and the Subsidiary Swing Line Borrowers to any Lender hereunder
shall be subject to the limitation that payments of interest shall not be
required for any period for which interest is computed hereunder, to the extent
(but only to the extent) that contracting for or receiving such payment by such
Lender would be contrary to the provisions of any law applicable to such Lender
limiting the highest rate of interest that may be lawfully contracted for,
charged or received by such Lender, and in such event the applicable Borrower or
the applicable Subsidiary Swing Line Borrower shall pay such Lender interest at
the highest rate permitted by applicable law.
2.11. Fees. In addition to certain fees described in Section 3.8:
(a) Arrangement, Agency Fees. The Borrowers shall pay fees to the
Arranger for the Arranger's own account as required by the letter
agreement ("Arranger Fee Letter") between the Arranger and AEA dated April
10, 1996 and shall pay agency fees
<PAGE>
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to the Administrative Agent for the Administrative Agent's own account as
required by the letter agreement between the Administrative Agent and AEA
dated October 7, 1996 (the "Administrative Agent's Fee Letter" and,
together with the Arranger Fee Letter, the "Fee Letters"). All fees paid
under the Fee Letters shall be paid solely in U.S. Dollars.
(b) Facility Fees. The Borrowers shall pay to the Administrative
Agent for the account of each Revolving Facility Lender a facility fee
computed at a rate per annum equal to 0.50% (the "Facility Fee") on the
average daily effective amount of such Lender's Revolving Facility
Commitment, computed on a quarterly basis in arrears on the last Business
Day of each calendar quarter. Such Facility Fee shall accrue from the
Closing Date to the earlier of the Termination Date and the date on which
the Revolving Facility Commitments have been terminated in full and shall
be due and payable quarterly in arrears on the last Business Day of each
calendar quarter (commencing December 31, 1996) through the Termination
Date or such earlier date as the Revolving Facility Commitments have been
terminated in full. The Facility Fee shall be paid solely in U.S. Dollars.
2.12. Computation of Fees, Interest and Dollar Equivalent Amount.
(a) All computations of the Facility Fee shall be made on the basis of a year of
360 days and actual days elapsed. All other computations of interest and fees
shall be made on the basis of a 360-day year and actual days elapsed. Interest
and fees shall accrue during each period during which interest or such fees are
computed from the first day thereof to the last day thereof. If a Loan is repaid
on the day on which it is made, one day's interest shall accrue at the rate per
annum applicable thereto as determined in accordance with Section 2.10 shall be
paid.
(b) Each determination of an interest rate or a Dollar Equivalent
amount by the Administrative Agent or an Applicable Swing Line Lender, as the
case may be, shall be conclusive and binding on the Borrowers and the Subsidiary
Swing Line Borrowers and the Lenders in the absence of manifest error. The
Administrative Agent or an Applicable Swing Line Lender, as the case may be,
will, at the request of the Borrowers or any Subsidiary Swing Line Borrower or
any Lender, deliver to the Borrowers or such Lender, as the case may be, a
statement showing the calculations used by the Administrative Agent or such
Applicable Swing Line Lender in determining any interest rate or Dollar
Equivalent amount.
2.13. Payments by the Borrowers and the Subsidiary Swing Line
Borrowers. (a) All payments to be made by the Borrowers and/or the Subsidiary
Swing Line Borrowers shall be made without set-off, recoupment or counterclaim.
Except as otherwise expressly provided herein, all payments by the Borrowers
and/or the Subsidiary Swing Line Borrowers that borrow in U.S. Dollars or Pounds
Sterling shall be made to the Administrative Agent for the account
<PAGE>
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of the Lenders (with respect to payments by the Borrowers) or Scotiabank (with
respect to Swing Line Loans made in U.S. Dollars or Pounds Sterling) at the
Administrative Agent's Payment Office and all payments to be made by all other
Subsidiary Swing Line Borrowers shall be made to the Applicable Swing Line
Lender as directed by it for the account of such Applicable Swing Line Lender.
Except as otherwise provided herein, all payments by the Borrowers or the
Subsidiary Swing Line Borrowers (i) with respect to principal of, interest on,
and any other amount relating to any Offshore Currency Loan, shall be made in
the Offshore Currency in which such Loan is denominated or payable, and (ii)
with respect to all other amounts payable hereunder, shall be made in U.S.
Dollars. Such payments shall be made in Same Day Funds and (x) in the case of
Offshore Currency payments, no later than such time on the dates specified
herein as may be determined by the Administrative Agent (or the Applicable Swing
Line Lender for Swing Line Loans not made in U.S. Dollars or Pounds Sterling)
(and advised in writing to the Borrowers or the applicable Subsidiary Swing Line
Borrower) to be necessary for such payment to be credited on such date in
accordance with normal banking procedures in the place of payment, and (y) in
the case of any U.S. Dollar payments, no later than 11:00 a.m. (New York City
time) on the date specified herein. The Administrative Agent will promptly
distribute to each Lender its Pro Rata Share of such payment received by it for
the account of the Lenders in like funds as received. Any payment received by
the Administrative Agent or the Applicable Swing Line Lender, as the case may
be, later than the time specified in clause (x) or (y) above, as applicable,
shall be deemed to have been received on the following Business Day, and any
applicable interest or fee shall continue to accrue.
(b) Whenever any payment is due on a day other than a Business Day,
such payment shall be made on the following Business Day, and such extension of
time shall be included in the computation of interest or fees, as the case may
be.
(c) Unless the Administrative Agent receives notice from the
Borrowers and/or any Subsidiary Swing Line Borrower that borrows in U.S. Dollars
or Pounds Sterling, as the case may be, prior to the date on which any payment
is due to the Lenders that the Borrowers and/or Subsidiary Swing Line Borrower,
as the case may be, will not make such payment in full as and when required, the
Administrative Agent may assume that the Borrowers and/or such Subsidiary Swing
Line Borrower, as the case may be, has made such payment in full to the
Administrative Agent on such date in Same Day Funds and the Administrative Agent
may (but shall not be required to), in reliance upon such assumption, distribute
to each Lender on such due date an amount equal to the amount then due such
Lender. If and to the extent the Borrowers and/or any Subsidiary Swing Line
Borrower that borrows in U.S. Dollars or Pounds Sterling, as the case be, has
not made such payment in full to the Administrative Agent, each Lender shall
repay to the Administrative Agent on demand such amount distributed to such
Lender, together with interest thereon at (i) in the case of a payment in an
Offshore Currency, the Overnight Rate or (ii) in the case of a payment in U.S.
Dollars, the U.S. Federal Funds
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Rate, in each case for each day from the date such amount is distributed to such
Lender until the date repaid.
2.14. Payments by the Lenders to the Administrative Agent. (a)
Unless the Administrative Agent receives notice from a Lender on or prior to the
Closing Date or, with respect to any Committed Borrowing after the Closing Date,
at least one Business Day prior to the date of such Borrowing, that such Lender
will not make available as and when required hereunder to the Administrative
Agent for the account of the applicable Borrower the amount of that Lender's Pro
Rata Share of the Committed Borrowing the Administrative Agent may assume that
such Lender has made such amount available to the Administrative Agent in Same
Day Funds on the Borrowing Date and the Administrative Agent may (but shall not
be required to), in reliance upon such assumption, make available to the
Borrowers on such date a corresponding amount. If and to the extent any Lender
shall not have made its full amount available to the Administrative Agent in
Same Day Funds and the Administrative Agent in such circumstances has made
available to the Borrowers such amount, such Lender shall on the Business Day
following such Borrowing Date make such amount available to the Administrative
Agent, together with interest at (i) in the case of a payment in an Offshore
Currency, the Overnight Rate and (ii) in the case of a payment in U.S. Dollars,
at the U.S. Federal Funds Rate, in each case for each day during such period. A
notice of the Administrative Agent submitted to any Lender with respect to
amounts owing under this subsection (a) shall be conclusive, absent manifest
error. If such amount is so made available, such payment to the Administrative
Agent shall constitute such Lender's Loan on the date of Borrowing for all
purposes of this Agreement. If such amount is not made available to the
Administrative Agent on the Business Day following the Borrowing Date, the
Administrative Agent will notify the Borrowers of such failure to fund and, upon
demand by the Administrative Agent, the Borrowers shall pay such amount to the
Administrative Agent for the Administrative Agent's account, together with
interest thereon for each day elapsed since the date of such Committed
Borrowing, at a rate per annum equal to the interest rate applicable at the time
to the Committed Loans comprising such Borrowing.
(b) The failure of any Lender to make any Loan on any Borrowing Date
shall not relieve any other Lender of its obligation hereunder (if any) to make
a Loan on such Borrowing Date, but no Lender shall be responsible for the
failure of any other Lender to make the Loan to be made by such other Lender on
any Borrowing Date.
2.15. Adjustments. If any Lender (a "Benefitted Lender") shall at
any time receive any payment of all or part of the Obligations then due and
owing to it, 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 subsection 9.1(f) or (g), or otherwise (except pursuant to
Section 2.6, 2.7, 2.8 or 2.9, Article IV or Section 11.8)), in a greater
proportion than any
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such payment to or collateral received by any other Lender, if any, in respect
of the Obligations then due and owing to such other Lender, such Benefitted
Lender shall purchase for cash from the other Lenders an interest (by
participation or assignment (each in accordance with Section 11.8)) in such
portion of each such other Lender's Revolving Credit Loans, Term Loans or the
L/C Obligations, as the case may be, owing to it, 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 (based upon Dollar Equivalent
amounts) 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. Each Borrower
expressly consents to the foregoing arrangement and agrees that any holder of a
participation in any such Loan or L/C Obligation, as the case may be, so
purchased and any other subsequent holder of a participation in any Loan or L/C
Obligation otherwise acquired may exercise any and all rights of banker's lien,
set off or counterclaim with respect to any and all monies owing by such
Borrower to that holder as fully as if that holder were a holder of such a Loan
or L/C Obligation in the amount of the participation held by that holder.
2.16. Swing Line Commitment. (a) Subject to the terms and conditions
of this Agreement, each Swing Line Lender agrees to make loans to the Swing Line
Borrowers on a revolving basis (each such loan, a "Swing Line Loan") from time
to time on any Business Day during the period from the Closing Date to the
Termination Date in an aggregate principal amount at any one time outstanding
for the Swing Line Borrowers collectively not to exceed the Dollar Equivalent
amount of U.S. $25.0 million; provided, however, that (i) the aggregate amount
(or CHF Equivalent with respect to M-T AG) of Swing Line Loans made and
outstanding at any one time to any Subsidiary Swing Line Borrower shall not
exceed the Subsidiary Swing Line Borrower Sublimit for such Subsidiary Swing
Line Borrower (or with respect to the German Subsidiaries, the collective
sublimit of the German Subsidiaries) and the aggregate Dollar Equivalent amount
of Swing Line Loans made to US Borrower shall not exceed the US Borrower
Sublimit, (ii) the sum of the Dollar Equivalent amount of the aggregate
principal amount of all outstanding Swing Line Loans, plus the aggregate
principal Dollar Equivalent amount of all other outstanding Revolving Facility
Loans, plus (without duplication) the Effective Amount of all L/C Obligations
shall not at any time exceed the Revolving Facility Commitments of all Revolving
Facility Lenders and (iii) Scotiabank need only make Swing Line Loans in U.S.
Dollars to US Borrower and in Pounds Sterling to M-T Leicester; Credit Suisse
need only make Swing Line Loans to M-T AG in such currencies as it shall agree
with such Subsidiary Swing Line Borrower; and each other Swing Line Lender need
only make Swing Line Loans to the Subsidiary Swing Line Borrower as it shall
agree with and in the Applicable Currency as it and the applicable Subsidiary
Swing Line Borrower shall agree. All Swing Line Loans made in U.S. Dollars shall
be made and maintained as ABR Loans.
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(b) Notwithstanding any other provision of this Agreement, (i) each
of the German Subsidiaries shall only borrow Swing Line Loans in, and no Swing
Line Lender need make any Swing Line Loan to any such Subsidiary Swing Line
Borrower other than in, Deutschemarks; (ii) Mettler-Toledo S.A., Veroflay shall
only borrow Swing Line Loans in, and no Swing Line Lender need make any Swing
Line Loan to such Subsidiary Swing Line Borrower other than in, French Francs;
(iii) Mettler-Toledo K.K., Takarazuka shall only borrow Swing Line Loans in, and
no Swing Line Lender need make any Swing Line Loan to such Subsidiary Swing Line
Borrower other than in, Japanese Yen; (iv) M-T Leicester shall only borrow Swing
Line Loans in, and no Swing Line Lender need make any Swing Line Loan to such
Subsidiary Swing Line Borrower other than in, Pounds Sterling; and (v) US
Borrower shall only borrow Swing Line Loans in, and no Swing Line Lender need
make any Swing Line Loan to US Borrower other than in, U.S. Dollars.
(c) Credit Suisse shall not permit the CHF Equivalent amount of all
Swing Line Loans outstanding for M-T AG to exceed M-T AG's Subsidiary Swing Line
Borrower Sublimit.
2.17. Borrowing Procedures for Swing Line Loans. (a) A Swing Line
Borrower requesting a Swing Line Loan shall give written or telephonic notice to
the Applicable Swing Line Lender of each proposed Borrowing pursuant to this
Section 2.17 not later than 11:00 a.m. (local time) on the proposed date of
Borrowing (promptly followed within one Business Day by delivery of a written
notice). Each such notice shall be effective upon receipt by the Applicable
Swing Line Lender and shall specify the date and amount of Borrowing. Unless the
Applicable Swing Line Lender has received written notice prior to 1:00 p.m.
(local time) on the proposed Borrowing Date from the Administrative Agent or any
Lender (or otherwise has knowledge) that one or more of the conditions precedent
set forth in Article V with respect to such Borrowing is not then satisfied, the
Applicable Swing Line Lender shall pay over the requested amount to the
applicable Swing Line Borrower on the requested Borrowing Date. Each Swing Line
Loan shall be made on a Business Day and shall be in the amount of (x) if made
in U.S. Dollars or Pounds Sterling, at least the Dollar Equivalent amount of
U.S. $500,000 and an integral multiple of U.S. $500,000 and (y) if made in any
Offshore Currency other than Pounds Sterling, at least such number of units of
the Applicable Currency and such integral multiple units of such Applicable
Currency as is agreed to by the Applicable Swing Line Lender and the applicable
Swing Line Borrower.
(b) The Applicable Swing Line Lender will determine the Dollar
Equivalent amount with respect to (i) any Borrowing of Swing Line Loans made by
such Swing Line Lender in an Offshore Currency as of the requested Borrowing
Date, (ii) all outstanding Swing Line Loans made by such Swing Line Lender that
are made in an Offshore Currency as of the last Business Day of each month, and
(iii) any outstanding Swing Line Loans made by such
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Swing Line Lender that are made in an Offshore Currency as of any date on which
the Revolving Facility Commitments, the US Borrower Sublimit or the Subsidiary
Swing Line Borrower Sublimits are reduced pursuant to Section 2.6.
2.18. Refunding of Swing Line Loans. The Applicable Swing Line
Lender may, at any time in its sole and absolute discretion, on behalf of US
Borrower, with respect to any Swing Line Loan made to US Borrower, or CH
Borrower, with respect to any Swing Line Borrower other than US Borrower (and
each such Borrower hereby irrevocably directs the Applicable Swing Line Lender
to act on its behalf), request each Revolving Facility Lender to make a
Revolving Loan (x) with respect to Credit Suisse, in CHF in an amount equal to
such Revolving Facility Lender's Pro Rata Share of the Dollar Equivalent amount
of the CHF Equivalent amount of the principal amount of the Swing Line Loans
made by such Swing Line Lender outstanding on the date such notice is given and
(y) with respect to each other Swing Line Lender other than Credit Suisse, in
the Offshore Currency of the Swing Line Loans made by such Swing Line Lender
(or, with respect to Scotiabank, as identified and made by it) in an amount
equal to such Revolving Facility Lender's Pro Rata Share of the Dollar
Equivalent amount of the principal amount of the Swing Line Loans made by such
Swing Line Lender outstanding on the date such notice is given. Unless any of
the events described in subsection 9.1(f) or (g) shall have occurred (in which
event the procedures of Section 2.19 shall apply), and regardless of whether the
conditions precedent set forth in this Agreement to the making of a Revolving
Loan are then satisfied or the aggregate amount of such Revolving Loans is not
in the minimum or integral amount otherwise required hereunder, each Revolving
Facility Lender shall make the proceeds of its Revolving Loan available to the
Administrative Agent for the account of the Applicable Swing Line Lender at the
office of the Administrative Agent in New York prior to 11:00 a.m. (New York
City time with respect to any refunding of a Swing Line Loan made in U.S.
Dollars or London, England time with respect to any other Swing Line Loan) in
Same Day Funds on the Business Day next succeeding the date such notice is
given. The proceeds of such Revolving Loans shall be immediately applied to
repay the outstanding Swing Line Loans of the Applicable Swing Line Lender. All
Revolving Loans made pursuant to this Section 2.18 shall be LIBOR Rate Committed
Loans with an Interest Period of one month (but, subject to the other provisions
of this Agreement, may be continued as LIBOR Rate Committed Loans with a
different Interest Period). No Revolving Facility Lender need make any Loan
under this Section 2.18 (x) with respect to Credit Suisse, other than in CHF and
(y) with respect to any other Swing Line Lender, unless the Swing Line Loan has
been made in accordance with subsection 2.16(b). Notwithstanding any other
provision of this Agreement, if any Swing Line Lender shall have made Swing Line
Loans to a Subsidiary Swing Line Borrower in excess of the applicable Subsidiary
Swing Line Borrower Sublimit of such Subsidiary Swing Line Borrower (or, with
respect to M-T AG, in excess of the CHF Equivalent of the Subsidiary Swing Line
Borrower Sublimit of M-T AG), no Lender shall have any obligation to make a
Revolving Loan with respect to such excess.
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2.19. Participations in Swing Line Loans. (a) If an event described
in subsection 9.1(f) or (g) occurs (or for any reason the Revolving Facility
Lenders may not make Revolving Loans pursuant to Section 2.18), each Revolving
Facility Lender will, upon notice from the Administrative Agent, purchase from
the Applicable Swing Line Lender (and the Applicable Swing Line Lender will sell
to each such Revolving Facility Lender) an undivided participation interest in
all outstanding Swing Line Loans of such Swing Line Lender in an amount equal to
its Pro Rata Share of the Dollar Equivalent amount of the outstanding principal
amount of the Swing Line Loans of such Swing Line Lender (and each Revolving
Facility Lender will immediately transfer to the Administrative Agent, for the
account of the Applicable Swing Line Lender, in immediately available funds, the
amount of its participation).
(b) Whenever, at any time after a Swing Line Lender has received
payment for any Revolving Facility Lender's participation interest in the Swing
Line Loans of such Swing Line Lender pursuant to subsection 2.19(a), such Swing
Line Lender receives any payment on account thereof, such Swing Line Lender will
distribute to the Administrative Agent for the account of such Revolving
Facility Lender its participation interest in such amount (appropriately
adjusted, in the case of interest payments, to reflect the period of time during
which such Revolving Facility Lender's participation interest was outstanding
and funded) in like funds as received; provided, however, that in the event that
such payment received by such Swing Line Lender is required to be returned, such
Revolving Facility Lender will return to the Administrative Agent for the
account of such Swing Line Lender any portion thereof previously distributed by
such Swing Line Lender to it in like funds as such payment is required to be
returned by such Swing Line Lender.
(c) Notwithstanding any other provision of this Agreement, if any
Swing Line Lender shall have made Swing Line Loans to a Subsidiary Swing Line
Borrower in excess of the applicable Subsidiary Swing Line Borrower Sublimit for
such Subsidiary Swing Line Borrower (or, with respect to M-T AG, in excess of
the CHF Equivalent of the Subsidiary Swing Line Borrower Sublimit of M-T AG), no
Lender shall have any obligation to purchase any participation in the amount of
such excess.
2.20. Swing Line Participation Obligations Unconditional. (a) Except
as provided in Section 2.18 and Section 2.19, each Revolving Facility Lender's
obligation to make Revolving Loans pursuant to Section 2.18 and/or to purchase
participation interests in Swing Line Loans pursuant to Section 2.19 shall be
absolute and unconditional and shall not be affected by any circumstance
whatsoever, including (a) any set-off, counterclaim, recoupment, defense or
other right which such Revolving Facility Lender may have against the Applicable
Swing Line Lender, any Loan Party or any other Person for any reason whatsoever;
(b) the occurrence or continuance of an Event of Default; (c) any adverse change
in the condition (financial or otherwise) of any Loan Party or any other Person;
(d) any breach of this Agreement by any
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Loan Party or any other Revolving Facility Lender; (e) any inability of the
applicable Swing Line Borrower to satisfy the conditions precedent to borrowing
set forth in this Agreement on the date upon which any Swing Line Loan is to be
refunded or any participation interest therein is to be purchased; or (f) any
other circumstance, happening or event whatsoever, whether or not similar to any
of the foregoing.
(b) Notwithstanding the provisions of subsection 2.20(a), no
Revolving Facility Lender shall be required to make any Revolving Loan to either
Borrower to refund a Swing Line Loan pursuant to Section 2.18 or to purchase a
participation interest in a Swing Line Loan pursuant to Section 2.19 if, prior
to the making by the Applicable Swing Line Lender of such Swing Line Loan, such
Swing Line Lender received written notice from such Revolving Facility Lender
specifying that such Revolving Facility Lender believes in good faith that one
or more of the conditions precedent to the making of such Swing Line Loan were
not satisfied and, in fact, such conditions precedent were not satisfied at the
time of the making of such Swing Line Loan; provided, however, that the
obligation of such Revolving Facility Lender to make such Revolving Loans and to
purchase such participation interests shall be reinstated upon the earlier to
occur of (i) the date on which such Revolving Facility Lender notifies the
Applicable Swing Line Lender that its prior notice has been withdrawn and (ii)
the date on which all conditions precedent to the making of such Swing Line Loan
have been satisfied (or waived by the Required Revolving Facility Lenders, the
Required Lenders or all Lenders, as applicable).
2.21. Conditions to Swing Line Loans. Notwithstanding any other
provision of this Agreement, no Swing Line Lender shall be obligated to make any
Swing Line Loan if an Event of Default or Unmatured Event of Default exists or
would result therefrom.
2.22. Substitution of Lenders in Certain Circumstances. In the event
that (x) S&P or Moody's shall, after the date that any Person becomes a Lender,
downgrade the long-term certificate of deposit ratings of such Lender, and the
resulting ratings shall be below BBB- or Baa3, respectively, or the equivalent
or (y) any Revolving Facility Lender gives notice to the Administrative Agent
that it is unable to make, convert or continue any Offshore Currency Loan
pursuant to subsection 2.5(b) or (c), then the Borrowers or the Administrative
Agent shall each have the right, but not the obligation, upon notice to such
Lender and the Administrative Agent, to replace such Lender with a financial
institution (a "Substitute Lender") acceptable to the Borrowers and the
Administrative Agent (such consents not to be unreasonably withheld or delayed;
provided, however, that no such consent shall be required if the Substitute
Lender is an existing Lender), and upon any such downgrading of any Lender's
long-term certificate of deposit rating or the giving of such notice, each such
Lender hereby agrees to transfer and assign (in accordance with and subject to
the restrictions contained in Section 11.8) its Commitments, Loans, Notes and
other rights and obligations under this Agreement and all other Loan Documents
to such Substitute Lender; provided, however, that (i) such assignment shall be
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without recourse, representation or warranty (other than that such Lender owns
the Commitments, Loans, and Notes being assigned, free and clear of any Liens)
and (ii) the purchase price paid by the Substitute Lender shall be in the amount
of such Lender's Loans and its Pro Rata Share of outstanding L/C Obligations,
together with all accrued and unpaid interest and fees in respect thereof, plus
all other amounts (other than the amounts (if any) demanded and unreimbursed
under Sections 4.1, 4.3 and 4.4, which shall be paid by the Borrowers), owing to
such Lender hereunder. Upon any such termination or assignment, such Lender
shall cease to be a party hereto but shall continue to be entitled to the
benefits of any provisions of this Agreement which by their terms survive the
termination of this Agreement.
2.23. Qualified Foreign Lender Notes. (a) Any Lender that is not a
"bank" within the meaning of Section 881(c)(3)(A) of the Code and that is in
compliance with the requirements of subsection 4.1(f)(i) (a "Qualified Foreign
Lender") shall upon receipt of the written request of US Borrower or the
Administrative Agent, and may upon its own written request to the Administrative
Agent, (i) exchange any Tranche B Term Note held by or assigned to it for a note
in the form attached hereto as Exhibit H-8 (a "QFL B Note") and (ii) exchange
any Tranche C(US) Term Note held by or assigned to it for a note in the form
attached hereto as Exhibit H-9 (a "QFL C(CH) Note" and together with the QFL B
Note, the "QFL Notes"); provided, however that, prior to any exchange of Notes,
such Lender shall have delivered to US Borrower the certificates, documents and
forms described in subsection 4.1(f)(i). Any QFL Notes issued in exchange for
any existing Notes pursuant to this subsection 2.23(a) shall be (i) dated the
Closing Date, (ii) issued in the names of the entities in whose names such
existing Notes were issued and (iii) issued in the same principal amounts as
such existing Notes. Any Tranche B Term Note or Tranche C(US) Term Note
exchanged pursuant to this subsection is sometimes referred to herein as an
"Exchange Note".
(b) US Borrower agrees that, upon the request of or delivery of a
request to a Qualified Foreign Lender pursuant to subsection (a) of this Section
2.23, it shall execute and deliver QFL Notes to the Administrative Agent in
exchange for the Exchange Note surrendered in connection with such request
conforming to the requirements of such subsection (a). Each Qualified Foreign
Lender shall surrender its Exchange Notes to the Administrative Agent in
connection with any exchange pursuant to this subsection (b). Upon receipt by
the Administrative Agent of the Exchange Notes to be exchanged for such QFL
Notes in accordance with this subsection (b), the Administrative Agent shall
forward the appropriate QFL Notes to the Qualified Foreign Lender which
surrendered its Exchange Notes for exchange and shall forward the Exchange Notes
to US Borrower marked "cancelled." Once issued, QFL Notes (i) shall be deemed to
and shall be "Notes" and Tranche B Term Notes and Tranche C(US) Term Notes, as
the case may be, for all purposes under this Agreement, the Security Documents
and the other Loan Documents, (ii) may not be exchanged for Tranche B Term Notes
or Tranche C(US) Term Notes, as the case may be, notwithstanding anything to the
contrary in this
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Agreement and (iii) shall at all times thereafter be QFL Notes, including,
without limitation, following any transfer or assignment thereof.
ARTICLE III.
THE LETTERS OF CREDIT
3.1. The Letter of Credit Subfacility. (a) On the terms and
conditions set forth herein, (i) the L/C Lender agrees, (A) from time to time on
any Business Day during the period from the Closing Date to the Termination Date
to issue Letters of Credit (including irrevocable standby letters of credit) for
the account of either Borrower (or, if a Letter of Credit is for the account of
a Subsidiary, jointly for the account of the applicable Borrower and such
Subsidiary), and to amend or renew Letters of Credit previously issued by it, in
accordance with subsections 3.2(c) and 3.2(d), and (B) to honor properly drawn
drafts under the Letters of Credit; and (ii) the Revolving Facility Lenders
severally agree to participate in Letters of Credit Issued for the accounts of
the Borrowers (including any Letter of Credit issued jointly for the account of
a Borrower and any Subsidiary); provided, however, that the L/C Lender shall not
be obligated to Issue, and no Lender shall be obligated to participate in, any
Letter of Credit if as of the date of Issuance of such Letter of Credit (the
"Issuance Date") (1) the Effective Amount of all L/C Obligations, plus (without
duplication) the outstanding principal Dollar Equivalent amount of all Revolving
Loans and Swing Line Loans exceeds the combined Revolving Facility Commitments
of all Revolving Facility Lenders, (2) the participation of such Revolving
Facility Lender in the Effective Amount of all L/C Obligations, plus (without
duplication) the outstanding principal Dollar Equivalent amount of the Revolving
Loans of such Revolving Facility Lender, plus such Revolving Facility Lender's
Pro Rata Share of the Dollar Equivalent amount of all outstanding Swing Line
Loans exceeds such Revolving Facility Lender's Revolving Facility Commitment, or
(3) the Effective Amount of all L/C Obligations exceeds the L/C Commitment.
Within the foregoing limits, and subject to the other terms and conditions
hereof, the Borrowers' ability to obtain Letters of Credit shall be fully
revolving, and, accordingly, the Borrowers may, during the foregoing period,
obtain Letters of Credit to replace Letters of Credit which have expired or
which have been drawn upon and reimbursed. For purposes of this Article III,
there shall at all times be deemed to be outstanding Swing Line Loans in an
amount equal to the Assumed Swing Line Loan Amount.
(b) The L/C Lender is under no obligation to Issue any Letter of
Credit if: (i) any order, judgment or decree of any Governmental Authority or
arbitrator shall by its terms purport to enjoin or restrain the L/C Lender from
Issuing such Letter of Credit, or any Requirement of Law applicable to the L/C
Lender or any request or directive (whether or not
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having the force of law) from any Governmental Authority with jurisdiction over
the L/C Lender shall prohibit, or request that the L/C Lender refrain from, the
Issuance of letters of credit generally or such Letter of Credit in particular
or shall impose upon the L/C Lender with respect to such Letter of Credit any
restriction, reserve or capital requirement (for which the L/C Lender is not
otherwise compensated hereunder) not in effect on the Closing Date, or shall
impose upon the L/C Lender any unreimbursed loss, cost or expense which was not
applicable on the Closing Date and which the L/C Lender in good faith deems
material to it; (ii) the L/C Lender has received written notice from any Lender,
the Administrative Agent or either Borrower, on or prior to the Business Day
prior to the requested date of Issuance of such Letter of Credit, that one or
more of the applicable conditions contained in Article V is not then satisfied;
(iii) the expiry date of any requested Letter of Credit is (A) more than twelve
months after the date of such Issuance for standby Letters of Credit or more
than 180 days after the date of such issuance for commercial documentation
Letters of Credit, unless the Required Revolving Facility Lenders have approved
such expiry date in writing; provided, however, that any standby Letter of
Credit may be automatically extendible for periods of up to one year so long as
such Letter of Credit provides that the L/C Lender retains an option reasonably
satisfactory to the L/C Lender, to terminate such Letter of Credit prior to each
extension date, or (B) after the fifth Business Day prior to the Termination
Date, unless all of the Revolving Facility Lenders have approved such expiry
date in writing; (iv) any requested Letter of Credit does not provide for
drafts, or is not otherwise in form and substance reasonably acceptable to the
L/C Lender, or the Issuance of a Letter of Credit shall violate any applicable
policies of the L/C Lender; (v) such Letter of Credit is denominated in a
currency other than US$ or an Offshore Currency; or (vi) an Event of Default or
Unmatured Event of Default has occurred and is continuing.
(c) Notwithstanding the foregoing, in the event a Lender Default
exists, the L/C Lender shall not be required to issue any Letter of Credit
unless the L/C Lender has entered into arrangements satisfactory to it and the
Borrowers to eliminate the L/C Lender's risk with respect to the participation
in Letters of Credit of the Defaulting Lender or Lenders, including by cash
collateralizing such Defaulting Lender's or Lenders' Pro Rata Share of the L/C
Obligations.
3.2. Issuance, Amendment and Renewal of Letters of Credit. (a) Each
Letter of Credit shall be Issued upon the irrevocable written request of the
applicable Borrower received by the L/C Lender (with a copy sent by the
applicable Borrower to the Administrative Agent) at least three Business Days
(or such shorter time as the L/C Lender may agree in a particular instance in
its sole discretion) prior to the proposed date of Issuance. Each such request
for Issuance of a Letter of Credit shall be by facsimile, confirmed in an
original writing, in the form of an L/C Application, and shall specify in form
and detail reasonably satisfactory to the L/C Lender: (i) the proposed date of
Issuance of the Letter of Credit (which shall be a Business Day); (ii) the face
amount of the Letter of Credit; (iii) the expiry date of the Letter of
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Credit; (iv) the name and address of the beneficiary thereof; (v) the documents
to be presented by the beneficiary of the Letter of Credit in case of any
drawing thereunder; (vi) the full text of any certificate to be presented by the
beneficiary in case of any drawing thereunder; (vii) the type of Letter of
Credit; and (viii) such other matters as the L/C Lender may reasonably require.
(b) At least two Business Days prior to the Issuance of any Letter
of Credit, the L/C Lender will confirm with the Administrative Agent (by
telephone or in writing) that the Administrative Agent has received a copy of
the L/C Application or L/C Amendment Application from the applicable Borrower
and, if not, the L/C Lender will provide the Administrative Agent with a copy
thereof. Unless the L/C Lender has received, on or before the Business Day
immediately preceding the date the L/C Lender is to Issue a requested Letter of
Credit, (A) notice from the Administrative Agent directing the L/C Lender not to
Issue such Letter of Credit because such Issuance is not then permitted under
subsection 3.1(a) as a result of the limitations set forth in clauses (1)
through (3) thereof or (B) a notice described in subsection 3.1(b)(ii), then,
subject to the terms and conditions hereof, the L/C Lender shall, on the
requested date, Issue a Letter of Credit for the account of the applicable
Borrower (or jointly for the account of the applicable Borrower and the
applicable Subsidiary) in accordance with the L/C Lender's usual and customary
business practices.
(c) From time to time while a Letter of Credit is outstanding and
prior to the Termination Date, the L/C Lender will, upon the written request of
the applicable Borrower received by the L/C Lender (with a copy sent by the
applicable Borrower to the Administrative Agent) at least three days (or such
shorter time as the L/C Lender may agree in a particular instance in its sole
discretion) prior to the proposed date of amendment, amend any Letter of Credit
Issued by it. Each such request for amendment of a Letter of Credit shall be
made by facsimile, confirmed immediately in an original writing, made in the
form of an L/C Amendment Application and shall specify in form and detail
reasonably satisfactory to the L/C Lender: (i) the Letter of Credit to be
amended; (ii) the proposed date of amendment of the Letter of Credit (which
shall be a Business Day); (iii) the nature of the proposed amendment; and (iv)
such other matters as the L/C Lender may reasonably require. The L/C Lender
shall be under no obligation to amend any Letter of Credit if: (A) the L/C
Lender would have no obligation at such time to Issue such Letter of Credit in
its amended form under the terms of this Agreement; or (B) the beneficiary of
any such Letter of Credit does not accept the proposed amendment to the Letter
of Credit. The Administrative Agent will promptly notify the Revolving Facility
Lenders of the receipt by it of any L/C Application or L/C Amendment
Application.
(d) The L/C Lender and the Revolving Facility Lenders agree
that, while a standby Letter of Credit is outstanding and prior to the
Termination Date, at the option of the applicable Borrower and upon the written
request of the applicable Borrower received by the
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L/C Lender (with a copy sent by the applicable Borrower to the Administrative
Agent) at least three Business Days (or such shorter time as the L/C Lender may
agree in a particular instance in its sole discretion) prior to the proposed
date of notification of renewal, the L/C Lender shall be entitled to authorize
the automatic renewal of any Letter of Credit Issued by it. Each such request
for renewal of a Letter of Credit shall be made by facsimile, confirmed in an
original writing, in the form of an L/C Amendment Application, and shall specify
in form and detail reasonably satisfactory to the L/C Lender: (i) the standby
Letter of Credit to be renewed; (ii) the proposed date of notification of
renewal of the Letter of Credit (which shall be a Business Day not more than 60
days prior to the expiry date of the Letter of Credit being renewed); (iii) the
revised expiry date of the Letter of Credit; and (iv) such other matters as the
L/C Lender may reasonably require. The L/C Lender shall be under no obligation
so to renew any Letter of Credit if: (A) the L/C Lender would have no obligation
at such time to Issue or amend such Letter of Credit in its renewed form under
the terms of this Agreement; or (B) the beneficiary of any such Letter of Credit
does not accept the proposed renewal of the Letter of Credit. If any outstanding
Letter of Credit shall provide that it shall be automatically renewed unless the
beneficiary thereof receives notice from the L/C Lender that such Letter of
Credit shall not be renewed, and if at the time of renewal the L/C Lender would
be entitled to authorize the automatic renewal of such Letter of Credit in
accordance with this subsection 3.2(d) upon the request of the applicable
Borrower but the L/C Lender shall not have received any L/C Amendment
Application from the applicable Borrower with respect to such renewal or other
written direction by the applicable Borrower with respect thereto, the L/C
Lender shall nonetheless be permitted to allow such Letter of Credit to renew,
and the applicable Borrower and the Revolving Facility Lenders hereby authorize
such renewal, and, accordingly, the L/C Lender shall be deemed to have received
an L/C Amendment Application from the applicable Borrower requesting such
renewal.
(e) The L/C Lender may, at its election (or as required by the
Administrative Agent at the direction of the Required Revolving Facility
Lenders), deliver any notices of termination or other communications to any
Letter of Credit beneficiary or transferee, and take any other reasonable
action, at any time and from time to time, in order to cause the expiry date of
such Letter of Credit to be a date not later than the fifth Business Day prior
to the Termination Date.
(f) This Agreement shall control in the event of any conflict with
any L/C- Related Document (other than any Letter of Credit).
(g) The L/C Lender will also deliver to the Administrative Agent,
concurrently or promptly following its delivery of a Letter of Credit, or
amendment to or renewal of a Letter of Credit, to an advising bank or a
beneficiary, a true and complete copy of each such Letter of Credit or amendment
to or renewal of a Letter of Credit.
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3.3. Risk Participations, Drawings and Reimbursements. (a)
Immediately upon the Issuance of each Letter of Credit, each Revolving Facility
Lender shall be deemed to, and hereby irrevocably and unconditionally agrees to,
purchase from the L/C Lender a participation in such Letter of Credit and each
drawing thereunder in an amount equal to the product of (i) the Pro Rata Share
of such Revolving Facility Lender times (ii) the maximum amount available to be
drawn under such Letter of Credit and the amount of such drawing, respectively.
(b) In the event of any request for a drawing under a Letter of
Credit by the beneficiary or transferee thereof, the L/C Lender will promptly
notify the applicable Borrower (but the failure to so notify any Borrower shall
not impair any rights of the Lenders or modify any obligation of the Borrowers).
The applicable Borrower shall reimburse the L/C Lender prior to 1:00 p.m. (New
York City time), on each date that any amount is paid by the L/C Lender under
any Letter of Credit (each such date, an "Honor Date"), in an amount equal to
the amount so paid by the L/C Lender. In the event the applicable Borrower fails
to reimburse the L/C Lender for the full amount of any drawing under any Letter
of Credit by 1:00 p.m. (New York City time) on the Honor Date, the L/C Lender
will promptly notify the Administrative Agent and the Administrative Agent will
promptly notify each Lender thereof. Thereupon the applicable Borrower shall be
deemed to have requested that Revolving Loans be made by the Revolving Facility
Lenders to be disbursed on the Honor Date under such Letter of Credit, subject
to the amount of the unutilized portion of the Revolving Facility Commitment and
subject to the conditions set forth in subsections 5.2(b) and (c), which Loans
shall be ABR Loans accruing interest at a rate per annum equal to the Alternate
Base Rate, plus the Applicable Margin for ABR Loans which are Revolving Loans,
in the case of a drawing in U.S. Dollars, or Loans accruing interest at a rate
per annum equal to the Overnight Rate applicable to such Offshore Currency from
time to time in effect, plus the Applicable Margin for LIBOR Rate Committed
Loans which are Revolving Loans, in the case of a drawing in an Offshore
Currency. Any notice given by the L/C Lender or the Administrative Agent
pursuant to this subsection 3.3(b) may be oral if immediately confirmed in
writing (including by facsimile); provided, however, that the lack of such an
immediate confirmation shall not affect the conclusiveness or binding effect of
such notice.
(c) Each Revolving Facility Lender shall upon any notice pursuant to
subsection 3.3(b) make available to the Administrative Agent for the account of
the L/C Lender an amount in U.S. Dollars or the Offshore Currency in which such
Letter of Credit is denominated, as the case may be, and in Same Day Funds equal
to its Pro Rata Share of the amount of the drawing, whereupon the participating
Revolving Facility Lenders shall (subject to subsection 3.3(d)) each be deemed
to have made a Revolving Loan to the applicable Borrower in that amount accruing
interest at a rate per annum equal to the Alternate Base Rate, plus the
Applicable Margin for ABR Loans which are Revolving Loans (in the case of a
drawing in U.S. Dollars), or the Overnight Rate applicable to such Offshore
Currency from time to time in
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effect, plus the Applicable Margin for LIBOR Rate Committed Loans which are
Revolving Loans (in the case of a drawing in an Offshore Currency). If any
Revolving Facility Lender so notified fails to make available to the
Administrative Agent for the account of the L/C Lender the amount of such
Revolving Facility Lender's Pro Rata Share of the amount of the drawing by no
later than 1:00 p.m. (New York time) on the Honor Date, then interest shall
accrue on such Revolving Facility Lender's obligation to make such payment, from
the Honor Date to the date such Revolving Facility Lender makes such payment, at
a rate per annum equal to (i) in the case of a drawing in U.S. Dollars, the U.S.
Federal Funds Rate in effect from time to time during such period and (ii) in
the case of a drawing in an Offshore Currency, the Overnight Rate applicable to
such Offshore Currency from time to time in effect. The Administrative Agent
will promptly give notice of the occurrence of the Honor Date, but failure of
the Administrative Agent to give any such notice on the Honor Date or in
sufficient time to enable any Revolving Facility Lender to effect such payment
on such date shall not relieve such Revolving Facility Lender from its
obligations under this Section 3.3.
(d) With respect to any unreimbursed drawing that is not converted
into Revolving Loans to the applicable Borrower in whole or in part, because of
such Borrower's failure to satisfy the conditions set forth in subsections
5.2(b) and (c) or for any other reason, such Borrower shall be deemed to have
incurred from the L/C Lender an L/C Borrowing in the amount of such drawing,
which L/C Borrowing shall be due and payable on demand (together with interest)
and shall bear interest at a rate per annum equal to (i) in the case of a
drawing in U.S. Dollars, the Alternate Base Rate, plus 2% per annum, and (ii) in
the case of a drawing in an Offshore Currency, the Overnight Rate applicable to
such Offshore Currency from time to time in effect, plus 2% per annum, and each
Revolving Facility Lender's payment to the L/C Lender pursuant to subsection
3.3(c) shall be deemed payment in respect of its participation in such L/C
Borrowing and shall constitute an L/C Advance from such Revolving Facility
Lender in satisfaction of its participation obligation under this Section 3.3.
(e) Each Revolving Facility Lender's obligation in accordance with
this Agreement to make the Revolving Loans or L/C Advances, as contemplated by
this Section 3.3, as a result of a drawing under a Letter of Credit, shall be
absolute and unconditional and without recourse to the L/C Lender and shall not
be affected by any circumstance, including (i) any set-off, counterclaim,
recoupment, defense or other right which such Revolving Facility Lender may have
against the L/C Lender, the applicable Borrower or any other Person for any
reason whatsoever; (ii) the occurrence or continuance of an Event of Default, an
Unmatured Event of Default or a Material Adverse Effect; or (iii) any other
circumstance, happening or event whatsoever, whether or not similar to any of
the foregoing; provided, however, that each Revolving Facility Lender's
obligation to make Revolving Loans under this Section 3.3 is subject to the
conditions set forth in Section 5.2.
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3.4. Repayment of Participations. (a) Upon (and only upon) receipt
by the Administrative Agent for the account of the L/C Lender of Same Day Funds
from the applicable Borrower (i) in reimbursement of any payment made by the L/C
Lender under the Letter of Credit with respect to which any Revolving Facility
Lender has paid the Administrative Agent for the account of the L/C Lender for
such Revolving Facility Lender's participation in the Letter of Credit pursuant
to Section 3.3 or (ii) in payment of interest thereon, the Administrative Agent
will pay to each Revolving Facility Lender, in the same funds as those received
by the Administrative Agent for the account of the L/C Lender, the amount of
such Revolving Facility Lender's Pro Rata Share of such funds, and the L/C
Lender shall receive the amount of the Pro Rata Share of such funds of any
Revolving Facility Lender that did not so pay the Administrative Agent for the
account of the L/C Lender.
(b) If the Administrative Agent or the L/C Lender is required at any
time to return to the applicable Borrower, or to a trustee, receiver, liquidator
or custodian, or any official in any Insolvency Proceeding, any portion of any
payment made by such Borrower to the Administrative Agent for the account of the
L/C Lender pursuant to subsection 3.4(a) in reimbursement of a payment made
under any Letter of Credit or interest or fee thereon, each Revolving Facility
Lender shall, on demand of the Administrative Agent, forthwith return to the
Administrative Agent or the L/C Lender the amount of its Pro Rata Share of any
amount so returned by the Administrative Agent or the L/C Lender plus interest
thereon from the date such demand is made to the date such amount is returned by
such Revolving Facility Lender to the Administrative Agent or the L/C Lender, at
a rate per annum equal to the U.S. Federal Funds Rate in effect from time to
time.
3.5. Role of the L/C Lender. (a) Each Revolving Facility Lender and
the Borrowers agree that, in paying any drawing under a Letter of Credit, the
L/C Lender shall not have any responsibility to obtain any document (other than
any sight draft and certificates or other documents expressly required by the
Letter of Credit) or to ascertain or inquire as to the validity or accuracy of
any such document or the authority of the Person executing or delivering any
such document.
(b) None of the Agents, any of their respective Affiliates or any of
the respective correspondents, participants or assignees of the L/C Lender shall
be liable to any Revolving Facility Lender for: (i) any action taken or omitted
in connection herewith at the request or with the approval of the Revolving
Facility Lenders (including the Required Revolving Facility Lenders, as
applicable); (ii) any action taken or omitted in the absence of gross negligence
or willful misconduct; or (iii) the due execution, effectiveness, validity or
enforceability of any L/C-Related Document.
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(c) Each Borrower hereby assumes all risks of the acts or omissions
of any beneficiary or transferee with respect to its use of any Letter of
Credit; provided, however, that this assumption is not intended to, and shall
not, preclude a Borrower's pursuing such rights and remedies as it may have
against the beneficiary or transferee at law or under any other agreement. None
of the Agents, any of their respective Affiliates or any of the respective
correspondents, participants or assignees of the L/C Lender shall be liable or
responsible for any of the matters described in clauses (i) through (iv) of
Section 3.6; provided, however, that, anything in such clauses to the contrary
notwithstanding, a Borrower may have a claim against the L/C Lender, and the L/C
Lender may be liable to such Borrower, to the extent, but only to the extent, of
any direct, as opposed to consequential or exemplary, damages suffered by such
Borrower which such Borrower proves were caused directly by the L/C Lender's
willful misconduct or gross negligence or the L/C Lender's willful failure to
pay under any Letter of Credit after the presentation to it by the beneficiary
of a sight draft and certificate(s) strictly complying with the terms and
conditions of a Letter of Credit. In furtherance and not in limitation of the
foregoing: (i) the L/C Lender may accept documents that appear on their face to
be in order, without responsibility for further investigation, regardless of any
notice or information to the contrary; and (ii) the L/C Lender shall not be
responsible for the validity or sufficiency of any instrument transferring or
assigning or purporting to transfer or assign a Letter of Credit or the rights
or benefits thereunder or proceeds thereof, in whole or in part, which may prove
to be invalid or ineffective for any reason.
3.6. Obligations Absolute. The obligations of the Borrowers under
this Agreement and any L/C-Related Document to reimburse the L/C Lender for a
drawing under a Letter of Credit, and to repay any L/C Borrowing and any drawing
under a Letter of Credit converted into Committed Loans, shall be unconditional
and irrevocable, and shall be paid strictly in accordance with the terms of this
Agreement and each such other L/C-Related Document under all circumstances,
including the following: (i) any lack of validity or enforceability of this
Agreement or any L/C-Related Document; (ii) the existence of any claim, set-off,
defense or other right that a Borrower may have at any time against any
beneficiary or any transferee of any Letter of Credit (or any Person for whom
any such beneficiary or any such transferee may be acting), the L/C Lender or
any other Person, whether in connection with this Agreement, the transactions
contemplated hereby or by the L/C-Related Documents or any unrelated
transaction; (iii) any draft, demand, certificate or other document presented
under any Letter or Credit proving to be forged, fraudulent, invalid or
insufficient in any respect or any statement therein being untrue or inaccurate
in any respect; or any loss or delay in the transmission or otherwise of any
document required in order to make a drawing under any Letter of Credit; or (iv)
any other circumstance or happening whatsoever, whether or not similar to any of
the foregoing, including any other circumstance that might otherwise constitute
a defense available to, or a discharge of, a Borrower or a guarantor; provided,
however, that the Borrowers shall not be obligated to reimburse the L/C Lender
for any wrongful payment made
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by the L/C Lender as a result of acts or omissions constituting willful
misconduct or gross negligence on the part of the L/C Lender.
3.7. Cash Collateral Pledge. If any Letter of Credit remains
outstanding and partially or wholly undrawn as of the Termination Date, then the
Borrowers shall immediately Cash Collateralize the L/C Obligations in an amount
equal to the maximum amount then available to be drawn under all Letters of
Credit.
3.8. Letter of Credit Fees. (a) The applicable Borrower shall pay to
the Administrative Agent for the account of each of the Revolving Facility
Lenders a letter of credit fee with respect to the Letters of Credit at a rate
per annum equal to the then Applicable Margin for LIBOR Rate Committed Loans
which are Revolving Facility Loans on an amount equal to the average daily
maximum amount available to be drawn of the outstanding Letters of Credit (the
"Computation Amount"), computed on a quarterly basis in arrears on the last
Business Day of each calendar quarter and on the Termination Date (or such later
date on which all outstanding Letters of Credit have been terminated or have
expired) based upon Letters of Credit outstanding for the applicable period as
calculated by the Administrative Agent.
(b) The applicable Borrower shall pay to the Administrative Agent
for the account of the L/C Lender a letter of credit fronting fee for each
Letter of Credit Issued by the L/C Lender of at least U.S. $100 or, if greater,
at the rate per annum equal to 1/4% of the Computation Amount, computed on the
last Business Day of each calendar quarter and on the Termination Date (or such
later date on which all outstanding Letters of Credit have been terminated or
have expired) based upon the Letters of Credit outstanding for the applicable
period as calculated by the Administrative Agent, which fee shall be credited
against the fee payable under subsection 3.8(a).
(c) The letter of credit fees payable under subsection 3.8(a) and
the fronting fees payable under subsection 3.8(b) shall be due and payable
quarterly in arrears on the last Business Day of each calendar quarter during
which Letters of Credit are outstanding, commencing on the first such quarterly
date to occur after the Closing Date, through the Termination Date (or such
later date upon which all outstanding Letters of Credit have been terminated or
have expired), with the final payment to be made on the Termination Date (or
such later termination or expiration date). All fees payable under this Section
3.8 shall be calculated as of their due date based upon the Dollar Equivalent
amount of the Computation Amount as of such date based upon the Spot Rate. All
such fees shall be payable solely in U.S. Dollars.
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(d) The Borrowers shall pay to the L/C Lender from time to time on
demand the normal issuance, presentation, amendment and other processing fees,
and other standard costs and charges, of the L/C Lender relating to letters of
credit as from time to time in effect.
3.9. Uniform Customs and Practice. The Uniform Customs and Practice
for Documentary Credits as published by the International Chamber of Commerce
most recently at the time of issuance of any Letter of Credit shall (unless
otherwise expressly provided in such Letter of Credit) apply to such Letter of
Credit.
3.10. Letters of Credit for the Account of Subsidiaries. Each
Borrower and its applicable Subsidiary shall be jointly and severally liable for
any Letter of Credit which is issued jointly for the account of that Borrower
and any of its Subsidiaries.
ARTICLE IV.
NET PAYMENTS, YIELD PROTECTION AND ILLEGALITY
4.1. Net Payments. (a) Except as provided in subsection 4.1(b), all
payments by any Loan Party to any Lender or any Agent under this Agreement and
any other Loan Document shall be made free and clear of, and without deduction
or withholding for, any Covered Taxes levied or imposed by any Governmental
Authority with respect to such payments. The Borrowers covenant and agree on
behalf of the Subsidiaries that the provisions of this Section 4.1 shall apply
to all payments under any Loan Document. In the event that any Loan Party (other
than a Borrower or a Subsidiary Swing Line Borrower) is obligated to make any
payments described in this Section 4.1 under any Loan Document, the Lenders and
Agents covenant and agree to deliver to any such Loan Party any forms or
certificates that (i) they are able to deliver and (ii) they would have been
required to deliver to such Loan Party if it were a Borrower or Subsidiary Swing
Line Borrower pursuant to this Section 4.1 and the appropriate requests therefor
have been made; provided, however, that no Lender or Agent shall have any
liability to any Loan Party or any other Person if not in compliance with this
sentence.
(b) If any Loan Party shall be required by law to deduct or withhold
any Covered Taxes from or in respect of any sum payable hereunder to any Lender
or any Agent, then except as provided in subsection 4.1(g): (i) the sum payable
shall be increased as necessary so that after making all such required
deductions and withholdings (including deductions and withholdings applicable to
additional sums payable under this Section) such Lender or such Agent, as the
case may be, receives an amount equal to the sum it would have received had no
such deductions or withholdings been made; (ii) such Loan Party shall make such
deductions and withholdings; and (iii) such Loan Party shall pay the full amount
deducted or withheld to the
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relevant taxing authority or other authority in accordance with applicable law.
If for any reason CH Borrower or any other Loan Party fails to make any payments
required under the preceding sentence, then US Borrower shall make such payments
on behalf of CH Borrower or such Loan Party. Within 30 days after the date of
any payment by a Loan Party of Covered Taxes, such Loan Party shall furnish the
Administrative Agent or the Applicable Subsidiary Swing Line Lender, in the case
of any Subsidiary Swing Line Borrower, the original or a certified copy of a
receipt evidencing payment thereof, or other evidence of payment reasonably
satisfactory to the Administrative Agent or the Applicable Subsidiary Swing Line
Lender, in the case of any Subsidiary Swing Line Borrower.
(c) The Loan Parties agree to indemnify and hold harmless each
Lender and each Agent for (i) the full amount of Covered Taxes (including any
Covered Taxes imposed by any jurisdiction on amounts payable under this Section
4.1) paid by such Lender or such Agent and any liability (including penalties,
interest, additions to tax and expenses) arising therefrom or with respect
thereto, whether or not such Covered Taxes were correctly or legally asserted,
and (ii) any Taxes levied or imposed by any Governmental Authority on any
additional amounts paid by any Loan Party under this Section 4.1 that are
measured by such Lender's or such Agent's net income by the jurisdiction (or any
political subdivision thereof) under the laws of which such Lender or such
Agent, as the case may be, is organized or maintains a Lending Office.
(d) If a Lender or an Agent receives a refund or credit of Taxes
paid or indemnified by a Loan Party pursuant to subsection (b) or (c) of this
Section 4.1, then such Lender or such Agent shall promptly repay the applicable
Loan Party such refund or credit (whether paid pursuant to subsection (b) or (c)
of this Section 4.1 and whether of the type described in either clause (i) or
(ii) of such subsection (c)) net of all out-of-pocket expenses related thereto
and without interest (other than interest received as part of such refund or
credit); provided, however, that if, due to any adjustment of such Taxes (or of
any liability, including penalties, interest, additions to tax and expenses,
arising therefrom or with respect thereto), such Lender or such Agent loses the
benefit of all or any portion of such refund or credit, the Loan Parties will
indemnify and hold harmless such Lender or such Agent in accordance with this
subsection. A certificate as to the amount of any such required indemnification
payment prepared with a reasonable basis by the Lender or such Agent shall be
final, conclusive and binding for all purposes. Payment under this
indemnification shall be made within 30 days after the date such Lender or such
Agent makes written demand therefor by the delivery of such certificate.
(e) If any Loan Party is required to pay additional amounts to any
Lender or any Agent pursuant to this Section 4.1, then such Lender shall use
reasonable efforts (consistent with legal and regulatory restrictions) to change
the jurisdiction of its Lending Office or take
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other appropriate action so as to eliminate any such additional payment by such
Loan Party which may thereafter accrue, if such change or other action in the
reasonable judgment of such Lender is not otherwise disadvantageous or
burdensome to such Lender.
(f)(i) Each Lender or Agent which is not a United States person (as
such term is defined in Section 7701(a) of the Code) agrees that:
(A) it shall, no later than the Closing Date (or, in the case of a
Lender which becomes a party hereto after the Closing Date, the date upon
which such Lender becomes a party hereto) deliver to the Administrative
Agent and to the Borrowers through the Administrative Agent (x) two
accurate and complete signed originals of Internal Revenue Service Form
4224 or any successor thereto ("Form 4224"), or two accurate and complete
signed originals of Internal Revenue Service Form 1001 or any successor
thereto ("Form 1001"), as appropriate, or (y) if such Lender is not a
"bank" within the meaning of Section 881(c)(3)(A) of the Code and cannot
deliver either Form 1001 or Form 4224 pursuant to clause (x) above, a
certificate substantially in the form of Exhibit L-1 (any such
certificate, a "Section 4.1(f)(i) Certificate") and, in the case of either
(x) or (y), two accurate and complete original signed copies of Internal
Revenue Service Form W-8 or any successor thereto ("Form W-8") or Internal
Revenue Service Form W-9 or any successor thereto ("Form W-9"), whichever
is applicable;
(B) if at any time such Lender or Agent makes any changes
necessitating a new Form 4224, Form 1001, Form W-8, Form W-9 or Section
4.1(f)(i) Certificate, as the case may be, it shall with reasonable
promptness deliver to the Administrative Agent and to the Borrowers
through the Administrative Agent in replacement for, or in addition to,
the forms previously delivered by it hereunder, two accurate and complete
signed originals of Form 4224, Form 1001, Form W-8, Form W-9 or Section
4.1(f)(i) Certificate, as appropriate; and
(C) it shall, before or promptly after the occurrence of any event
(including the passing of time (and in any event (x) in the case of a Form
4224 or Section 4.1(f)(i) Certificate, before the payment of any interest
in each succeeding taxable year of such Lender after the Closing Date
during which interest may be paid under this Agreement, and (y) in the
case of a Form 1001, before the payment of any interest in each third
succeeding calendar year after the Closing Date during which interest may
be paid under this Agreement) but excluding any event mentioned in clause
(B) above) requiring a change in or renewal of the most recent Form 4224,
Form 1001, Form W-8, Form W-9 or Section 4.1(f)(i) Certificate, previously
delivered by such Lender or Agent, deliver to the Administrative Agent and
to the Borrowers through the Administrative Agent two accurate and
complete original signed copies of Form 4224, Form 1001, or Form W-8
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and a Section 4.1(f)(i) Certificate, in replacement for the forms
previously delivered by such Lender or Agent.
(ii) Each Lender or Agent that is incorporated or organized under
the laws of the United States of America or a state thereof shall provide two
properly completed and duly executed copies of Form W-9, or successor applicable
form, at the times specified for delivery of forms under paragraph (f)(i) of
this subsection.
(iii) Each Form 1001 or 4224 delivered by a Lender or Agent pursuant
to this subsection (f) shall certify, unless unable to do so by virtue of a
Change in Law occurring after the date such Lender or Agent becomes a party
hereto, that the Lender or Agent is entitled to receive payments under this
Agreement without deduction or withholding of U.S. federal income taxes and each
Form W-9 shall certify, unless unable to do so by virtue of a Change in Law
occurring after the date such Lender or Agent becomes a party hereto, that such
Lender or Agent is entitled to an exemption from U.S. backup withholding.
(iv) Notwithstanding the foregoing provisions of this subsection (f)
or any other provision of this Section 4.1, no Lender or Agent shall be required
to deliver any form pursuant to this Section 4.1 if such Lender or Agent is not
legally able to do so by virtue of a Change in Law occurring after the date such
Lender or Agent becomes a party hereto.
(v) Each Revolving Facility Lender, Tranche A Lender and Tranche
C(CH) Lender shall, no later than the Closing Date (or, in the case of any such
Lender which becomes a party hereto after the Closing Date, the date upon which
such Lender becomes a party hereto) deliver a certificate substantially in the
form of Exhibit L-2 or other form of certificate reasonably satisfactory to CH
Borrower (any such certificate, a "Section 4.1(f)(v) Certificate"); provided,
however, that (x) if the Tranche C(CH) Term Loan made on the Closing Date by
each initial Tranche C(CH) Lender is at least a minimum of U.S. $4.0 million,
then no Tranche C(CH) Lender shall be required to deliver such Section 4.1(f)(v)
Certificate if it is unable to do so and (y) with respect to any Revolving
Facility Loan or Tranche A Term Loan (a) no Revolving Facility Lender or Tranche
A Lender making Loans or having Commitments as of the Closing Date need deliver
any Section 4.1(f)(v) Certificate if (i) it is unable to do so and (ii) the
total number of Lenders within the same Facility who have not delivered Section
4.1(f)(v) Certificates does not exceed three and (b) after the Closing Date no
Assignee of a Revolving Facility Lender or Tranche A Lender need deliver any
Section 4.1(f)(v) Certificate if (i) it is unable to do so and (ii) the
assignment to such Assignee would not increase beyond three the sum of (a) the
total number of Lenders within the same Facility who have not delivered Section
4.1(f)(v) Certificates and (b) the total number of Lenders within the same
Facility who have notified CH Borrower or the Administrative Agent that any of
the representations made in a previously delivered Section 4.1.(f)(v)
Certificate are no longer true
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and correct. Each Lender delivering a Section 4.1(f)(v) Certificate further
agrees to deliver a new Section 4.1(f)(v) Certificate at the times specified for
delivery of a Section 4.1(f)(i) Certificate under subsections (f)(i)(B) and (C)
of this Section 4.1, unless it is unable to do so by virtue of a Change in Law
occurring after the date such Lender becomes a party hereto.
(vi) Each Lender or Agent shall, promptly upon a Loan Party's or the
Administrative Agent's reasonable request to that effect, deliver to such Loan
Party or the Administrative Agent (as the case may be) such other forms or
similar documentation or other information as may be required from time to time
by any applicable law, treaty, rule or regulation of any Governmental Authority
in order to establish such Lender's or Agent's tax status for withholding
purposes.
(g) No Loan Party will be required to pay any additional amount in
respect of Taxes pursuant to this Section 4.1 to any Lender or to any Agent with
respect to any Lender if the obligation to pay such additional amount would not
have arisen but for a failure by such Lender to comply with its obligations
under subsection 4.1(f) or Section 11.8.
(h) Each Lender agrees to indemnify and hold harmless the Loan
Parties and each Agent from and against any Taxes, penalties, interest and other
costs or losses (including Attorney Costs) incurred or payable by the Loan
Parties or an Agent as a result of the failure of the Loan Parties or an Agent
to comply with its obligations to deduct or withhold any Taxes from any payments
made pursuant to this Agreement which failure resulted from such Loan Party's or
an Agent's reasonable reliance on any form, statement, certificate or other
information provided to it by such Lender pursuant to this Section 4.1.
(i) If, at any time, a Borrower or a Subsidiary Swing Line Borrower
requests any Lender to deliver any forms or other documentation pursuant to
subsection 4.1(f)(vi), then such Borrower or such Subsidiary Swing Line Borrower
shall, on demand of such Lender through the Administrative Agent, reimburse such
Lender for any material costs and expenses (including Attorney Costs) reasonably
incurred by such Lender in the preparation or delivery of such forms or other
documentation.
4.2. Illegality. (a) If any Lender determines that any Change in Law
has made it unlawful, or that any central bank or other Governmental Authority
has asserted that it is unlawful, for such Lender or its applicable Lending
Office to make or maintain LIBOR Rate Committed Loans in any Applicable Currency
then, on notice thereof by the Lender to the Borrowers through the
Administrative Agent, any obligation of such Lender to make, convert or continue
LIBOR Rate Committed Loans in such Applicable Currency shall be suspended until
such Lender notifies the Administrative Agent and the Borrowers that the
circumstances giving rise to such determination no longer exist and until such
time such Lender's commitment shall
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be only to make an ABR Loan when a LIBOR Rate Committed Loan is requested in
such Applicable Currency.
(b) If a Lender determines that it is unlawful to maintain any LIBOR
Rate Committed Loan in any Applicable Currency, (x) with respect to any such
LIBOR Rate Committed Loan that is an Offshore U.S. Dollar Loan, such Loan shall
be automatically converted to an ABR Loan either on the last day of the Interest
Period therefor, if such Lender may lawfully continue to maintain such LIBOR
Rate Committed Loan to such day, or immediately if such Lender may not lawfully
continue to maintain such LIBOR Rate Committed Loan and (y) with respect to any
other LIBOR Rate Committed Loan, the Borrowers shall, upon their receipt of
notice of such fact and demand from such Lender (with a copy to the
Administrative Agent), prepay in full such LIBOR Rate Committed Loans of such
Lender then outstanding in such Applicable Currency, together with interest
accrued thereon and amounts required under Section 4.4, either on the last day
of the Interest Period therefor, if such Lender may lawfully continue to
maintain such LIBOR Rate Committed Loan to such day, or immediately, if such
Lender may not lawfully continue to maintain such LIBOR Rate Committed Loan.
(c) Before giving any notice to the Administrative Agent under this
Section, the affected Lender shall designate a different Lending Office with
respect to its LIBOR Rate Committed Loans or take other appropriate action if
such designation or other action will avoid the need for giving notice and will
not, in the judgment of such Lender, be illegal or otherwise disadvantageous to
such Lender.
4.3. Increased Costs and Reduction of Return. (a) If any Lender
determines that, due to either (i) the introduction of or any change in or in
the interpretation of any law or regulation or (ii) the compliance by such
Lender with any guideline or request from any central bank or other Governmental
Authority (whether or not having the force of law), in either case after the
date of this Agreement there shall be any increase in the cost to such Lender of
agreeing to make or making, funding or maintaining any LIBOR Rate Committed Loan
or participating in Letters of Credit, or, in the case of the L/C Lender, any
increase in the cost to the L/C Lender of agreeing to issue, issuing or
maintaining any Letter of Credit or of agreeing to make or making, funding or
maintaining any unpaid drawing under any Letter of Credit, then the Borrowers
shall be liable for, and shall from time to time, upon demand (which demand
shall contain a reasonably detailed calculation of any relevant costs and shall
be conclusive and binding in the absence of manifest error, and a copy thereof
shall be sent to the Administrative Agent), pay to the Administrative Agent for
the account of such Lender, additional amounts as are sufficient to compensate
such Lender for such increased costs; provided, however, that CH Borrower shall
only be liable for those additional amounts relating to the Obligations of CH
Borrower and each CH Foreign Subsidiary.
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(b) If any Lender shall have determined that (i) the introduction of
any Capital Adequacy Regulation, (ii) any change in any Capital Adequacy
Regulation, (iii) any change in the interpretation or administration of any
Capital Adequacy Regulation by any central bank or other Governmental Authority
charged with the interpretation or administration thereof, or (iv) compliance by
such Lender (or its Lending Office) or any corporation controlling such Lender
with any Capital Adequacy Regulation, in each case after the date of this
Agreement, affects or would affect the amount of capital required or expected to
be maintained by such Lender or any corporation controlling such Lender and
(taking into consideration such Lender's or such corporation's policies with
respect to capital adequacy) determines that the amount of such capital is
increased as a consequence of its Commitment, Loans, credits or obligations
under this Agreement, then, upon demand of such Lender to the Borrowers through
the Administrative Agent, the Borrowers shall pay to such Lender, from time to
time as specified by such Lender, additional amounts reasonably sufficient to
compensate such Lender for such increase; provided, however, that CH Borrower
shall only be liable for those additional amounts relating to the Obligations of
CH Borrower and each CH Foreign Subsidiary. A statement of such Lender as to any
such additional amount or amounts (including calculations thereof in reasonable
detail), in the absence of manifest error, shall be conclusive and binding on
the Borrowers. In determining such amount or amounts, such Lender may use any
method of averaging and attribution that it (in its sole and absolute
discretion) shall deem applicable.
(c) Nothing in this Section 4.3 shall obligate any Loan Party to
make any payments with respect to Taxes of any sort, indemnification for which
is governed by Section 4.1.
4.4. Funding Losses. The applicable Borrower shall, within five days
of receipt of written notice thereof, reimburse each Lender and hold each Lender
harmless from any loss or expense which such Lender may sustain or incur as a
consequence of: (a) the failure of such Borrower to make on a timely basis any
payment of principal of any LIBOR Rate Committed Loan; (b) the failure
(including by reason of Section 4.5) of such Borrower to borrow, continue or
convert a LIBOR Rate Committed Loan after such Borrower has given (or is deemed
to have given) a Notice of Committed Borrowing or a Notice of
Conversion/Continuation (other than any such failure arising as a result of a
default by such Lender or the Administrative Agent); (c) the failure of such
Borrower to make any prepayment of any Committed Loan in accordance with any
notice delivered under Section 2.7; (d) the prepayment (including pursuant to
Section 2.7 or 2.8) or other payment (including after acceleration thereof) the
principal of any LIBOR Rate Committed Loan on a day that is not the last day of
the relevant Interest Period; or (e) the conversion under Section 2.4 of any
LIBOR Rate Committed Loan to an ABR Loan on a day that is not the last day of
the relevant Interest Period; including any such loss or expense arising from
the liquidation or reemployment of deposits or other funds obtained by it to
make, continue or maintain the applicable Loans or from fees payable to
terminate the
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deposits from which such funds were obtained. Such written notice (which shall
include calculations in reasonable detail) shall, in the absence of manifest
error, be conclusive and binding on the Borrowers. For purposes of calculating
amounts payable by the applicable Borrower to any Lender under this Section and
under subsection 4.3(a), each LIBOR Rate Committed Loan made by a Lender (and
each related reserve, special deposit or similar requirement) shall be
conclusively deemed to have been funded at the LIBOR Rate used in determining
the interest rate for such LIBOR Rate Committed Loan by a matching deposit or
other borrowing in the interbank eurodollar market for a comparable amount and
for a comparable period and in the same Applicable Currency, whether or not such
LIBOR Rate Committed Loan is in fact so funded.
4.5. Inability to Determine Rates. (a) If the Required Revolving
Facility Lenders or Lenders holding a majority of the Loans under the Tranche B
Term Loan Facility, the Tranche C(CH) Term Loan Facility or the Tranche C(US)
Term Loan Facility determine that for any reason adequate and reasonable means
do not exist for determining the LIBOR Rate for any requested Interest Period
with respect to a proposed LIBOR Rate Committed Loan under the applicable
Facility, the Administrative Agent will promptly so notify the applicable
Borrower and each Lender under such Facility. Thereafter, the obligation of the
Lenders under such Facility to make, convert or maintain LIBOR Rate Committed
Loans in the Applicable Currency shall be suspended until the Administrative
Agent upon the instruction of the Required Revolving Facility Lenders or Lenders
holding a majority of the Loans under the Tranche B Term Loan Facility, the
Tranche C(CH) Term Loan Facility or the Tranche C(US) Term Loan Facility, as the
case may be, revoke such notice in writing. Upon receipt of such notice, the
applicable Borrower may revoke any Notice of Committed Borrowing or Notice of
Conversion/Continuation then submitted by it. If the applicable Borrower does
not revoke (x) any such Notice of Committed Borrowing for Revolving Loans or (y)
any such Notice of Conversion/Continuation with respect solely to Offshore U.S.
Dollar Loans, the Lenders shall make, convert or continue the applicable Loans,
as proposed by such Borrower, in the amount specified in the applicable notice
submitted by such Borrower, but such Loans shall be made, converted or continued
as ABR Loans instead of LIBOR Rate Committed Loans, and in the case of any
Offshore Currency Loans under the Revolving Facility, the Borrowing shall be
redenominated and thereby be made in an aggregate amount equal to the Dollar
Equivalent amount of the originally requested Borrowing in the Offshore
Currency. If the applicable Borrower does not revoke any Notice of
Conversion/Continuation with respect to any outstanding Revolving Loans that are
Offshore Currency Loans which are the subject of any such continuation, such
Offshore Currency Loans shall from the end of the current Interest Period
therefor bear interest at a rate per annum equal to the Applicable Margin for
LIBOR Rate Committed Loans which are Revolving Loans, plus the Overnight Rate
for the Applicable Currency as in effect from time to time or such other rate as
may be agreed to between the
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Borrowers and the Required Revolving Facility Lenders, and specified to the
Administrative Agent from time to time.
(b) If Lenders holding a majority of the Tranche A Term Loans
determine that for any reason adequate and reasonable means do not exist for
determining the LIBOR Rate for any requested Interest Period with respect to
Tranche A Term Loans, the Administrative Agent will promptly so notify CH
Borrower and each Lender under the Tranche A Term Loan Facility. Thereafter,
until the Administrative Agent upon the instruction of Lenders holding a
majority of the Tranche A Term Loans revokes such notice in writing, the Tranche
A Term Loans shall bear interest at a rate per annum equal to the Applicable
Margin for LIBOR Rate Committed Loans which are Tranche A Term Loans, plus the
Overnight Rate for the Applicable Currency as in effect from time to time or
such other rate as may be agreed to between CH Borrower and Lenders holding a
majority of the Tranche A Term Loans and specified to the Administrative Agent
from time to time.
4.6. Reserves on LIBOR Rate Committed Loans; MLA Costs. The
applicable Borrower shall pay to each Lender, as long as such Lender shall be
required under regulations of the FRB to maintain reserves with respect to
liabilities or assets consisting of or including Eurocurrency funds or deposits
(currently known as "Eurocurrency liabilities") and, in respect of any Offshore
Currency Loans, under any applicable regulations of the country in which the
Offshore Currency of such Offshore Currency Loans circulates, additional costs
on the unpaid principal amount of each LIBOR Rate Committed Loan and Offshore
Currency Loan equal to the actual costs of such reserves allocated to such Loan
by such Lender (as calculated by such Lender in good faith, which calculation
shall be set forth in reasonable detail and shall be conclusive), payable on
each date on which interest is payable on such Loan, provided the applicable
Borrower shall have received at least 15 days' prior written notice (with a copy
to the Administrative Agent) of the amount of such additional interest from such
Lender. If a Lender fails to give notice 15 days prior to the relevant Interest
Payment Date, such additional interest shall be payable 15 days from receipt of
such notice. The applicable Borrower shall also pay all MLA Cost to each Lender.
4.7. Certificates of Lenders. Any Lender claiming reimbursement or
compensation under this Article IV shall deliver to the applicable Borrower
(with a copy to the Administrative Agent) a certificate (a) setting forth in
reasonable detail the circumstances giving rise to such claim and a computation
of the amount payable to such Lender hereunder in respect thereof and (b)
certifying that such Lender is making similar claims based on such circumstances
to similarly-situated borrowers from such Lender. Any such certificate shall be
conclusive and binding on the applicable Borrower in the absence of manifest
error.
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4.8. Substitution of Lenders. Upon (x) the receipt by either
Borrower or any Subsidiary Swing Line Borrower or the Administrative Agent from
any Lender (an "Affected Lender") of a claim for compensation under Section 4.1
or 4.3 (or a Change in Law which could reasonably be determined to allow a
Lender to make such a claim) or a notice of the type described in subsection
2.5(b), 2.5(c), 4.2(a) or 4.2(b), (y) any Lender providing notice to the
Borrowers or any Subsidiary Swing Line Borrower that a representation contained
in a Section 4.1(f)(i) Certificate or Section 4.1(f)(v) Certificate is no longer
true and correct or (z) the refusal of any Lender to consent to a proposed
amendment, waiver or consent with respect to the Loan Documents which has been
approved by the Required Lenders as provided in subsection 11.1(b), a Borrower
or a Subsidiary Swing Line Borrower may: (i) request the Affected Lender to use
its best efforts to obtain a replacement bank or financial institution
satisfactory to such Borrower or such Subsidiary Swing Line Borrower to acquire
and assume all or a ratable part of all of such Affected Lender's Loans,
participation in L/C Obligations and Commitments (a "Replacement Lender"); (ii)
request one more of the other Lenders to acquire and assume all or part of such
Affected Lender's Loans and Commitments; or (iii) designate a Replacement
Lender. Any such designation of a Replacement Lender under clause (i) or (iii)
shall be subject to the prior written consent of the Agents (which consent shall
not be unreasonably withheld).
4.9. Right of Lenders to Fund Through Branches and Affiliates. Each
Lender may, if it so elects, fulfill its commitment as to any Loan hereunder by
designating a branch or Affiliate of such Lender to make such Loan; provided,
however, that (a) such Lender shall remain solely responsible for the
performances of its obligations hereunder, (b) no such designation shall result
in any increased costs to the Borrowers and (c) such branch or Affiliate
complies with all form delivery and other requirements hereunder (including
pursuant to Section 4.1).
ARTICLE V.
CONDITIONS PRECEDENT
5.1. Conditions of Initial Loans. For purposes of this Article V,
the "Subsidiaries" of the Borrowers shall be deemed to include those who will
become Subsidiaries of the Borrowers upon consummation of the Transactions. The
obligation of any Lender to make its initial Credit Extension hereunder (whether
by making a Loan or issuing a Letter of Credit) is subject to the satisfaction
of the following conditions:
(a) Credit Agreement; Guarantees; Notes. On the Closing Date, this
Agreement shall have been duly authorized, executed and delivered to the Lenders
by the Borrowers and the Subsidiary Swing Line Borrowers in form and substance
acceptable to the
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Agents and the Lenders. On the Closing Date there shall have been duly
authorized, executed and delivered to the Lenders in form and substance
satisfactory to the Agents and the Lenders (i) the Holding Guarantee by Holding,
(ii) the US Borrower Guarantee by US Borrower, (iii) a Domestic Subsidiary
Guarantee by each Domestic Subsidiary, (iv) the CH Borrower Guarantee by CH
Borrower and (v) to the extent permitted by applicable law, a Foreign Subsidiary
Guarantee by each CH Foreign Subsidiary (other than the Specified Subsidiaries).
On or prior to the Closing there shall have been delivered to the Administrative
Agent for the account of each Lender the appropriate Note, in each case executed
by the appropriate Borrower or Subsidiary Swing Line Borrower and appropriately
completed as to amounts and maturities.
(b) Transactions. (i) The terms, conditions and structure of each of
the Transactions and the Transaction Documents shall be in form and substance
reasonably satisfactory to the Agents. The terms and conditions of each of the
Other Documents shall be in form and substance reasonably satisfactory to the
Agents.
(ii) US Borrower shall have received aggregate gross cash proceeds
of not less than U.S. $135.0 million from the sale of the Senior Subordinated
Notes, Holding shall have consummated the Equity Issuance and contributed the
proceeds thereof (net of any expenses of the M-T Acquisition) in cash to US
Borrower.
(iii) On the Closing Date, the Transactions shall have been
consummated in all material respects in accordance with the terms of Transaction
Documents (without any waiver of any material provision thereof). Except as set
forth in Schedule 6.17, all Indebtedness of the Mettler-Toledo Group existing
immediately prior to the M-T Acquisition shall be repaid in full (or provision
made therefor) to the reasonable satisfaction of the Agents and all lending
commitments thereunder terminated to the reasonable satisfaction of the Agents
with all security interests in favor of existing lenders being unconditionally
released and evidence therefor shall have been provided to the Agents to their
reasonable satisfaction.
(c) Transaction Documents. A certificate of a Responsible Officer
certifying as of the Closing Date true and complete copies of each of the
Transaction Documents and each of the Other Documents shall have been delivered
to the Agents.
(d) Opinions of Counsel. On the Closing Date, the Lenders shall have
received an opinion or opinions, addressed to the Agents and each of the Lenders
and dated the Closing Date, from (i) Fried, Frank, Harris, Shriver & Jacobson,
counsel to the Loan Parties, which opinion shall cover the matters contained in
Exhibit F-1 and such other matters incident to the transactions contemplated
herein as the Agents may reasonably request, (ii) local counsel to the Foreign
Loan Parties, which opinion shall be in form and substance reasonably
satisfactory to the Agents, (iii) local counsel to the Domestic Loan Parties
reasonably satisfactory
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to the Agents in each jurisdiction in which Collateral is located, which
opinions shall cover the matters contained in Exhibit F-2 and such other matters
incident to the transactions contemplated herein and in the other Loan Documents
as the Agents may reasonably request and (iv) such local, foreign and other
counsel reasonably satisfactory to the Agents, which opinions shall cover the
perfection of the security interest granted, the enforceability of the Loan
Documents and such other matters incident to the transactions contemplated
herein as the Agents may reasonably request, and each such opinion shall be in
form and substance reasonably satisfactory to the Agents. At Closing Date, the
Arranger shall have received the opinions, dated as of Closing Date, and
addressed to them on behalf of the Lenders and the Agents, of any counsel
delivered to the underwriters of the Senior Subordinated Notes in connection
with the issuance and sale thereof or the consummation of the M-T Acquisition,
or otherwise, or letters, dated as of Closing Date, from such counsel entitling
the Arranger to rely on such opinions, in each case as the Arranger may
reasonably request.
(e) Corporate Documents. The Agents shall have received on or prior
to the Closing Date certified copies of the Organization Documents of each Loan
Party and of all corporate authority for each Loan Party (including board of
director resolutions and evidence of the incumbency, including specimen
signatures, of officers) with respect to the execution, delivery and performance
of such of the Loan Documents to which such Loan Party is intended to be a party
and each other document to be delivered by such Loan Party from time to time in
connection herewith and the extensions of credit hereunder (and the Agents and
each Lender may conclusively rely on such certificate until it receives notice
in writing from such Loan Party to the contrary), the granting of Liens under
the Security Documents, the execution, delivery and performance of the
Transaction Documents and the consummation of the Transactions.
(f) Adverse Change, etc. On or prior to the Closing Date, there
shall not have occurred or become known any material adverse change or any
condition or event that has had or could reasonably be expected to result in (i)
a material adverse change in the business, assets, liabilities (contingent or
otherwise), operations, condition (financial or otherwise) or solvency of US
Borrower and the Subsidiaries (after giving effect to the Transactions), taken
as a whole, or any material adverse change in the prospects of US Borrower and
the Subsidiaries (after giving effect to the Transactions), taken as a whole, in
each case since December 31, 1995 or (ii) a material adverse effect on the
rights or remedies of the Agents or any Lender under the Loan Documents (except
in each case to the extent that the incurrence of the Indebtedness pursuant to
this Agreement and the Senior Subordinated Notes or the consummation of the M-T
Acquisition would be deemed such an event or condition).
(g) Litigation. There shall be no litigation or administrative
proceedings or other legal or regulatory developments, actual or threatened,
that, singly or in the aggregate, would have a Material Adverse Effect, or a
material adverse effect on the ability of the Loan
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Parties to consummate the Transactions or the validity or enforceability of the
Loan Documents or the rights, remedies and benefits available to the Agents and
the Lenders under the Loan Documents, or which would be materially inconsistent
with the stated assumptions underlying the projections previously provided to
the Agents.
(h) Approvals. All requisite third parties (including Governmental
Authorities) shall have approved or consented to the Transactions and the other
transactions contemplated hereby to the extent required in each case to the
extent that the failure to obtain such consent or approval would have a Material
Adverse Effect, and there shall be no governmental or judicial action, actual or
threatened, that has or would have, singly or in the aggregate, a reasonable
likelihood of restraining, preventing or imposing burdensome conditions on the
consummation of the Transactions.
(i) Security Documents. (i) On or before the Closing Date, there
shall have been duly authorized, executed and delivered (i) by Holding, the
Holding Securities Pledge Agreement, (ii) by US Borrower, the US Borrower
Securities Pledge Agreement, (iii) by each Domestic Subsidiary which upon giving
effect to the consummation of the M-T Acquisition will hold any capital stock or
notes of any other Subsidiary, a Domestic Subsidiary Securities Pledge Agreement
and (iv) by CH Borrower and by each CH Foreign Subsidiary (other than any
Subsidiary listed on Schedule 7.22) which upon giving effect to the consummation
of the M-T Acquisition will hold any capital stock or notes of any other
Subsidiary, a Foreign Subsidiary Securities Pledge Agreement and there shall
have been delivered to the Administrative Agent, as pledgee thereunder, all of
the pledged securities referred to in any such Securities Pledge Agreement,
endorsed in blank in the case of promissory notes or accompanied by executed and
undated stock powers in the case of certificated capital stock (or otherwise
pledged in accordance with applicable law), and the Securities Pledge Agreements
shall be in full force and effect.
(ii) On or before the Closing Date, the Borrowers and each
Subsidiary executing and delivering a Subsidiary Guarantee (other than any
Subsidiary listed on Schedule 7.22) shall have duly authorized, executed and
delivered a Security Agreement and all such Security Agreements shall be in full
force and effect.
(iii) On or before the Closing Date, the Borrowers shall or shall
cause to be delivered each of the following documents and instruments:
(1) executed copies of Financing Statements (Form UCC-1) (and
foreign equivalents thereof) in appropriate form for filing under the UCC
and any other applicable foreign, domestic or local law, rules or
regulation in each jurisdiction as may be necessary or appropriate to
perfect the security interests purported to be created by the Security
Documents; and
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(2) certified copies of Requests for Information (Form UCC-11), or
equivalent reports or lien search reports, each of a recent date listing
all effective financing statements or comparable documents that name US
Borrower or any Subsidiary that will execute a Security Agreement as
debtor and that are filed in those jurisdictions in which any of the
Collateral is located and the jurisdictions in which US Borrower and such
Subsidiaries' principal place of business is located, none of which
encumber the Collateral covered or intended or purported to be covered by
the Security Documents other than those encumbrances permitted by the
Security Documents.
(iv) To the extent that a material amount of Inventory is maintained
on a leased premise in the United States that is leased by a Domestic Loan
Party, such Domestic Loan Party shall request agreements from the respective
landlords of such of the Real Property which is being leased by such Domestic
Loan Party confirming that such landlords have subordinated their landlord liens
in such personal property to the security interests held by Administrative Agent
pursuant to the applicable Security Documents and that such landlords will
provide Administrative Agent with reasonable access to such facilities to
exercise Administrative Agent's remedies pursuant to such applicable Security
Documents.
(j) Conditions Relating to Mortgaged Real Property and Real
Property. On or prior to the Closing Date, each Borrower and each Subsidiary to
enter into a Mortgage shall have caused to be delivered to the Administrative
Agent, on behalf of the Lenders, the following documents and instruments:
(i) a Mortgage encumbering each Mortgaged Real Property in favor of
the Administrative Agent, for the benefit of the Lenders, in form for
recording in the recording office of each political subdivision or foreign
jurisdiction where each such Mortgaged Real Property is situated, together
with such certificates, affidavits, questionnaires or returns as shall be
required in connection with the recording or filing thereof to create a
lien under applicable law, and other similar statements as are
contemplated by the counsel opinions described in subsection 5.1(e) in
respect of such Mortgage, all of which shall be in form and substance
reasonably satisfactory to the Arranger, and any other instruments
necessary to grant a mortgage lien under the laws of any applicable
jurisdiction, which Mortgage and financing statements and other
instruments shall be effective to create a first priority Lien on such
Mortgaged Real Property subject to no Liens other than Prior Liens
applicable to such Mortgaged Real Property and other than Permitted Liens;
(ii) with respect to each Mortgaged Real Property, such consents,
approvals, estoppels, tenant subordination agreements or other instruments
as necessary or required
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to consummate the transactions contemplated hereby or as shall reasonably
be deemed necessary by the Arranger in order for the owner or holder of
the fee interest constituting such Mortgaged Real Property to grant the
Lien contemplated by the Mortgage with respect to such Mortgaged Real
Property; and
(iii) the following documents and instruments:
(l) with respect to each Mortgage, a policy (or commitment to issue
a policy) of title insurance insuring (or committing to insure) the Lien
of such Mortgage as a valid first priority Lien on the real property and
fixtures described therein in an amount not less than 115% of the fair
market value thereof which policy (or commitment) shall (a) be issued by
the Title Company, (b) include such reinsurance arrangements (with
provisions for direct access) as shall be reasonably acceptable to the
Arranger, (c) contain a "tie-in" or "cluster" endorsement (if available
under applicable law) (i.e., policies which insure against losses
regardless of location or allocated value of the insured property up to a
stated maximum coverage amount), (d) have been supplemented by such
endorsements (or where such endorsements are not available, opinions of
special counsel or other professionals reasonably acceptable to the
Arranger) as shall be reasonably requested by the Arranger, (e) such
affidavits and instruments of indemnification as shall be reasonably
required to induce the Title Company to issue the policy or policies (or
commitment) and endorsements contemplated in this subparagraph (iii) and
(f) contain no exceptions to title other than exceptions for (x) Liens of
the type described in clauses (a), (b), (c), (d), (g), (h), (i), (o) and
(p) of the definition of Permitted Liens, (y) any Lien of the type
described in clause (r) of the definition of Permitted Liens to the extent
the original Lien is permitted hereunder and (z) the Prior Liens
applicable to such Mortgaged Real Property;
(2) with respect to each Mortgaged Real Property, a Survey;
(3) with respect to each Mortgaged Real Property, policies or
certificates of insurance as required by the Mortgage relating thereto;
(4) with respect to each Mortgaged Real Property, UCC, judgment and
tax lien searches (or foreign jurisdictions equivalent) confirming that
the personal property comprising a part of such Mortgaged Real Property is
subject to no Liens other than Prior Liens;
(5) evidence acceptable to the Arranger of payment by the Borrowers
of all title insurance premiums, search and examination charges, survey
costs and related charges, mortgage recording taxes and related charges
required for the recording of the
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Mortgages and issuance of the title insurance policies referred to in
subparagraph (iii) above;
(6) with respect to each Real Property or Mortgaged Real Property,
copies of all Leases, subleases, leases in which a Loan Party holds the
tenant's interest or other agreements relating to possessory interests. To
the extent any of the foregoing affect any Mortgaged Real Property, such
agreement shall be subordinate to the Lien of the Mortgage to be recorded
against such Mortgaged Real Property, and shall otherwise be acceptable to
the Arranger; and
(7) with respect to each Mortgaged Real Property, an Officers'
Certificate or other evidence satisfactory to the Arranger that as of the
date thereof there (a) has been issued and is in effect, to the extent
required, a valid and proper certificate of occupancy or local or foreign
equivalent for the use then being made of such Mortgaged Real Property,
(b) has not occurred any material Destruction of any Mortgaged Real
Property that has not been restored and there is not pending any Taking of
any Mortgaged Real Property and (c) except as may be disclosed in the
Survey of such Mortgaged Real Property delivered pursuant to subsection
5.1(j)(iii)(2) above, are no disputes regarding boundary lines, location,
encroachment or possession of such Mortgaged Real Property and no state of
facts existing which could give rise to any such claim.
(k) Solvency Opinion; Environmental Analyses; Evidence of Insurance;
Financial Statements. On the Closing Date, the Agents and the Lenders shall have
received:
(i) an opinion (and related going-concern valuation) satisfactory in
all respects to the Agents and the Lenders from Appraisal Economics or
other independent valuation firm reasonably satisfactory to the Agents and
the Lenders to the effect that after giving effect to the Transactions, US
Borrower, on a consolidated basis, is not and will not be insolvent, will
not be left with unreasonably small capital with which to engage in its
business and has not incurred and will not have incurred debts beyond its
ability to pay such debts as they mature;
(ii) Phase I environmental assessments or their substantial
equivalent from ICF Kaiser Engineers, Inc. ("ICF") with respect to
domestic properties on which manufacturing operations are currently
conducted by US Borrower or any Subsidiary (immediately after giving
effect to the Transactions), and written reports from ICF with respect to
(A) foreign properties on which manufacturing operations are currently
conducted by US Borrower or any Subsidiary (immediately after giving
effect to the Transactions), (B) former manufacturing facilities at
Landing, New Jersey and Albstadt, Giessen and Steinbach, Germany, (C)
certain non-manufacturing properties in
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Switzerland and (D) certain representative domestic and foreign sales and
service offices in each case the results of which shall be in form and
substance reasonably satisfactory to the Agents and the Required Lenders;
and
(iii) evidence of insurance complying with the requirements of
Section 7.5 for the business and properties of US Borrower and the
Subsidiaries, in scope, form and substance satisfactory to the Agents and
the Required Lenders and naming the Administrative Agent as an additional
insured and/or loss payee.
(l) Pro Forma Balance Sheet. On or prior to the Closing Date, there
shall have been delivered to the Agents, an unaudited pro forma consolidated
balance sheet of US Borrower and the Subsidiaries as at June 30, 1996, after
giving effect to the Transactions and prepared in accordance with GAAP with U.S.
$ as the functional currency, together with a related funds flow statement,
which pro forma balance sheet and funds flow statement shall be satisfactory in
form and substance to the Agents and the Required Lenders.
(m) Payment of Fees. On the Closing Date, all costs, fees and
expenses, and all other compensation contemplated by this Agreement, due to the
Arranger, the Administrative Agent or the Lenders (including, without
limitation, Attorney Costs of the Agents) shall have been paid to the extent due
and if then invoiced.
(n) Other Matters. The Agents and the Lenders shall be reasonably
satisfied in all respects with (i) the status of all labor, employee benefit,
environmental and health and safety matters involving the Loan Parties, after
giving effect to the Transactions, and their plans with respect thereto; (ii)
the corporate and capital structure, and documents and instruments related
thereto, of the Loan Parties, after giving effect to the Transactions; (iii) the
amount, terms and conditions of any Indebtedness of any Loan Party to remain
outstanding after the Closing Date; (iv) the form and substance of all other
material documentation, including any tax sharing agreement, employment
agreement, management compensation arrangement (including any agreements entered
into with any of the senior management of the Borrowers) or other financing
arrangement of the Loan Parties; and (v) all legal, tax, accounting and currency
hedging matters relating to the transactions contemplated hereby, including,
without limitation, the ability of Subsidiaries of US Borrower to repatriate
funds to US Borrower and the withholding tax consequences thereof and the
Borrowers' plans and programs with respect to managing currency risk exposure.
(o) Certificate. A certificate signed by a Responsible Officer,
dated as of the Closing Date, stating that: (i) the representations and
warranties contained in Article VI are true and correct in all material respects
on and as of such date, as though made on and as of such date; (ii) no Event of
Default or Unmatured Event of Default exists or would result from the
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initial Credit Extension; and (iii) no event or circumstance has occurred since
December 31, 1995 with respect to US Borrower or any of its Subsidiaries (after
giving effect to the Transactions) that has resulted in a Material Adverse
Effect (except to the extent that the incurrence of Indebtedness pursuant to
this Agreement and the Senior Subordinated Notes or the consummation of the M-T
Acquisition would be deemed such an event or condition).
(p) Debt to Be Repaid. All Debt to Be Repaid set forth on Schedule
5.1(p) shall have been repaid in a manner satisfactory to the Agents and the
Lenders.
(q) Date of Closing. The Closing Date shall occur not later than
November 15, 1996.
5.2. Conditions to All Credit Extensions. The obligation of each
Lender to make any Credit Extension (including the initial Credit Extension) is
subject to the satisfaction of the following conditions precedent on the
relevant Borrowing Date or Issuance Date:
(a) Notice, Application. The Administrative Agent shall have
received a Notice of Committed Borrowing or the Applicable Swing Line Lender
shall have received notice from the applicable Swing Line Borrower of a Swing
Line Loan or the L/C Lender and the Administrative Agent shall have received an
L/C Application or L/C Amendment Application, as required under Section 3.2 (in
the case of any Issuance of a Letter of Credit).
(b) Continuation of Representations and Warranties. The
representations and warranties in Article VI shall be true and correct in all
material respects on and as of the date of such Credit Extension with the same
effect as if made on and as of such date (except to the extent such
representations and warranties expressly refer to an earlier date, in which case
they shall be true and correct as of such earlier date).
(c) No Existing Default; No Legal Bar. No Event of Default or
Unmatured Event of Default shall exist or will result from such Credit
Extension. No order, judgment or decree of any court, arbitration or
Governmental Authority shall purport to restrain any Lender from making any
Loans to be made by it on the date of such Credit Extension; and no injunction
or other restraining order shall have been issued and no hearing to cause an
injunction or other restraining order to be issued shall be pending or noticed
with respect to any action, suit or proceeding seeking to enjoin or otherwise
prevent the consummation of, or to recover any damages or obtain relief as a
result of, the transactions contemplated by this Agreement or the making of
Loans hereunder.
Each Notice of Committed Borrowing, L/C Application, L/C Amendment
Application and Swing Loan request submitted by either Borrower hereunder shall
constitute a
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representation and warranty by the Borrowers hereunder, as of the date of such
notice or request and as of the relevant Borrowing Date or Issuance Date, as
applicable, that the applicable conditions in this Section 5.2 are satisfied.
5.3 Delivery of Documents. All of the certificates, legal opinions
and other documents and papers referred to in Sections 5.1 and 5.2, unless
otherwise specified, shall be delivered to each of the Agents at their
respective office (or such other location as may be specified by such Agent) for
the account of each of the Lenders and in sufficient counterparts for each
Lender and, except where specifically otherwise provided, shall be reasonably
satisfactory to the Agents and the Lenders; provided, however, that for any
Credit Extension other than the initial Credit Extension, Borrower shall not be
required to deliver surveys, leases, insurance certificates, opinions, title
insurance, UCC, tax lien or judgment searches, or appraisals.
ARTICLE VI.
REPRESENTATIONS AND WARRANTIES
Each Borrower and Subsidiary Swing Line Borrower makes the following
representations and warranties to each Agent and each Lender, all of which shall
survive the execution and delivery of this Agreement and the making of the Loans
(with the execution and delivery of this Agreement and the making of each Loan
thereafter being deemed to constitute a representation and warranty that the
matters specified in this Article VI are true and correct in all material
respects after giving effect to the M-T Acquisition and the related transactions
and as of the date of such Loan unless such representation and warranty
expressly indicates that it is being made as of any specific date).
6.1. Corporate Status. Each Company (a) is a corporation,
partnership, joint stock company, limited liability company or other legal
entity duly organized, validly existing and, if applicable, in good standing
under the laws of its jurisdiction of organization; (b) has full corporate or
other power and authority and possesses all governmental franchises, licenses,
permits, authorizations and approvals necessary to enable it to own, lease or
otherwise hold its properties and assets and to carry on its business as
presently conducted; (c) in the case of the Domestic Loan Parties is duly
qualified and in good standing to do business as a foreign corporation in each
U.S. state in which the conduct or nature of its business or the ownership,
leasing or holding of its properties makes such qualification necessary; and (d)
is in compliance with all Requirements of Law, except, in each case referred to
in clauses (b), (c) and (d), to the extent that the failure to do so would not,
individually or in the aggregate, have a Material Adverse Effect.
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6.2. Authority. Each Loan Party has all requisite corporate power
and authority to enter into each Basic Document to which it is a party and to
perform its obligations thereunder and to consummate the transactions
contemplated thereby. All corporate acts and other proceedings required to be
taken by each Company to authorize the execution, delivery and performance of
each Basic Document to which such entity is a party and the consummation of the
transactions contemplated thereby have been duly and properly taken.
6.3. No Conflicts; Consents. (a) The execution, delivery and
performance by each Company of each Basic Document to which such entity is a
party does not and will not conflict with, or result in any violation of or
default (with or without notice or lapse of time, or both) under, or give rise
to a right of termination, cancellation or acceleration of any obligation or to
loss of a material benefit under, any provision of (i) the Organization
Documents of such Company; (ii) any note, bond, mortgage, indenture, deed of
trust, license, lease, contract, commitment, agreement or arrangement to which
such Company is a party or by which any of its properties or assets are bound,
except for Debt to Be Repaid; or (iii) any judgment, order or decree, or
statute, law, ordinance, rule or regulation applicable to such Company or its
properties or assets, other than, in the case of clauses (ii) and (iii) above,
any such items that would not, individually or in the aggregate, have a Material
Adverse Effect.
(b) No material consent, approval, license, permit, order or
authorization of, or registration, declaration or filing with, any Governmental
Authority is required to be obtained or made by or with respect to any Company
in connection with the execution, delivery and performance of any Basic Document
or the consummation of the Transactions or the other transactions contemplated
hereby or thereby, the failure of which to obtain would not, individually or in
the aggregate, have a Material Adverse Effect, other than filings required
pursuant to applicable antitrust laws, approvals required pursuant to the Lex
Friedrich Statute if applicable to the transactions contemplated hereby, U.S.
Federal, state and foreign securities and Blue Sky laws in connection with the
offering and sale of the Senior Subordinated Notes and Equity Issuance and
Chinese governmental consent to the transfer of the Chinese Subsidiaries.
6.4. Binding Effect. Each Basic Document to which any Company is a
party constitutes the legal, valid and binding obligation of such Company,
enforceable against such Company in accordance with its terms, except as
enforceability may be limited by applicable bankruptcy, insolvency or similar
laws affecting the enforcement of creditors' rights generally or by equitable
principles relating to enforceability, or by other laws and regulations of
non-U.S. jurisdictions.
6.5. Litigation. Except as may exist with respect to matters
specifically disclosed in Schedule 6.5, there are no actions, suits,
proceedings, claims or disputes pending or, to the best knowledge of any Loan
Party, threatened or contemplated, at law, in equity, in arbitration
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or before any Governmental Authority, against any Company or any of its
properties which (a) would have a Material Adverse Effect; or (b) would give
rise to any legal restraint on or prohibition against the Transactions or any of
the transactions contemplated by any Basic Document. No Company is a party or
subject to or in default under any material judgment, order, injunction or
decree of any Governmental Authority or arbitration tribunal applicable to it or
any of its respective properties, assets, operations or businesses, except where
such events would not, singly or in the aggregate, have a Material Adverse
Effect. There is no pending investigation of any Company, nor has there been any
such investigation threatened in writing in either case by any Governmental
Authority, except where such events could not, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect.
6.6. No Default. No Company is in default in the performance,
observance or fulfillment of any Contractual Obligation of such Company which
default would, singly or in the aggregate with any other default, have a
Material Adverse Effect, and no condition exists which, with the giving of
notice or the lapse of time or both, would, individually or in the aggregate
with any other condition, constitute such a default. No event has occurred and
no condition exists which, singly or in the aggregate with any other event or
condition, would constitute an Event of Default or an Unmatured Event of
Default. No Company is in violation of any term of its Organization Documents,
except where such violation would not, individually or in the aggregate, have a
Material Adverse Effect.
6.7. Benefit Plans. (a) Each Company and each of its ERISA
Affiliates are in compliance with all applicable provisions and requirements of
ERISA, the Code and other applicable laws with respect to each Plan, and have
performed all their material obligations under each Plan, except where
non-compliance or non-performance would not, individually or in the aggregate,
have a Material Adverse Effect. No ERISA Events have occurred or are reasonably
expected to occur which individually or in the aggregate resulted in or are
reasonably likely to result in (i) a Material Adverse Effect or (ii) the
imposition of a lien on the assets of any Company or any of its ERISA Affiliates
or a requirement for any Company or any of its ERISA Affiliates to post a bond
or other security. As of the most recent valuation date for any Pension Plan,
the amount of Unfunded Pension Liabilities individually or in the aggregate for
all Pension Plans (excluding for purposes of such computation any Pension Plans
which have a negative amount of Unfunded Pension Liabilities) does not exceed
$6.5 million.
(b) Each Company and each of the Foreign Plans are in compliance
with all applicable laws and regulations with respect to the Foreign Plans and
the terms of the Foreign Plans, and all required contributions have been made to
the Foreign Plans as are consistent with past practice and in the ordinary
course of business, except where non-compliance or failure would not,
individually or in the aggregate, have a Material Adverse Effect. For purposes
hereof, the term "Foreign Plans" shall mean any employee benefit plan, program,
policy,
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arrangement or agreement maintained or contributed to by, or entered into with,
a Company with respect to employees employed outside the United States.
6.8. Use of Proceeds; Margin Regulations. The proceeds of the Loans
are to be used solely for the purposes set forth in and permitted by Section
7.11 and Section 8.7. No Loan Party is generally engaged in the business of
purchasing or selling Margin Stock or extending credit for the purpose of
purchasing or carrying Margin Stock.
6.9. Financial Condition; Financial Statements; Solvency; etc. (a)
The audited combined balance sheet of the Mettler-Toledo Group dated December
31, 1995 (the "Balance Sheet"), and the audited combined statements of
operations and cash flows of the Mettler-Toledo Group for the year ended
December 31, 1995, together with the notes to such financial statements, have
been prepared in conformity with United States generally accepted accounting
principles consistently applied (except in each case as described in the notes
thereto) and on that basis fairly present the combined financial condition and
results of operations of the Mettler-Toledo Group as of the respective dates
thereof and for the respective periods indicated.
(b) Since December 31, 1995, there has not occurred an event or
condition that has had or would have, individually or in the aggregate, a
Material Adverse Effect, except to the extent that the incurrence of
Indebtedness pursuant to this Agreement and the Senior Subordinated Notes or the
consummation of the M-T Acquisition would be deemed such an event or condition.
(c) On and as of the Closing Date and on and as of each Borrowing
Date, on a pro forma basis after giving effect to the Transactions (solely as to
the Closing Date) and to all Indebtedness incurred, and to be incurred, and
Liens created, and to be created, by each Loan Party on such date, (x) the sum
of the assets, at a fair valuation, of each Loan Party and of US Borrower and
the Subsidiaries, on a consolidated basis, will exceed such Person's or Persons'
debts, on a consolidated basis, (y) each Loan Party has not and US Borrower and
the Subsidiaries, on a consolidated basis, have not incurred or intended to, or
believe that they will, incur debts beyond their ability to pay such debts as
such debts mature and (z) each Loan Party will have and US Borrower and the
Subsidiaries, on a consolidated basis, will have sufficient capital with which
to conduct their business. For purposes of this Section 6.9(c), "debt" means any
liability on a claim, and "claim" means (i) right to payment whether or not such
a right is reduced to judgment, liquidated, unliquidated, fixed, contingent,
matured, unmatured, disputed, undisputed, legal, equitable, secured or unsecured
or (ii) right to an equitable remedy for breach of performance if such breach
gives rise to a payment, whether or not such right to an equitable remedy is
reduced to judgment, fixed, contingent, matured, unmatured, disputed,
undisputed, secured or unsecured.
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(d) Except as fully reflected in the financial statements delivered
at any time pursuant to Section 7.1 or any financial statements delivered in
connection with the consummation of the Transactions and except for the
Indebtedness incurred under this Agreement and the Senior Subordinated Notes,
there were as of the Closing Date and on and as of each Borrowing Date (and
after giving effect to any Loans made on such date), no liabilities or
obligations (excluding current obligations incurred in the ordinary course of
business) with respect to US Borrower or any Subsidiary of any nature whatsoever
(whether absolute, accrued, contingent or otherwise and whether or not due), and
the Borrowers do not know of any such liability or obligation which,
individually or in the aggregate, has had or would have a Material Adverse
Effect.
(e) During the period from December 31, 1995 to and including the
Closing Date, except as provided in the Transaction Documents, there has been no
sale, transfer or other disposition by the Mettler-Toledo Group of any material
part of the business or property of the Mettler-Toledo Group, taken as a whole,
and no purchase or other acquisition by any of them of any business or property
(including any capital stock of any other Person) material in relation to the
consolidated financial condition of the Mettler-Toledo Group, taken as a whole,
in each case, which is not reflected in the financial statements delivered to
the Agents and the Lenders or in the notes thereto or otherwise in writing to
the Agents and the Lenders on or prior to the Closing Date (including the
prospectus filed with the SEC for the offering and sale of the Senior
Subordinated Notes).
6.10. Properties. US Borrower and each Subsidiary owns or leases, as
applicable, all properties and assets reflected in the most recent financial
statements delivered pursuant to Section 7.1, except as sold or otherwise
disposed of since the date of such financial statements in the ordinary course
of business and in accordance with this Agreement and the MT Acquisition
Documents. Title to each such property or asset is held by US Borrower or a
Subsidiary free and clear of all Liens, except for Prior Liens and Permitted
Liens. US Borrower and the Subsidiaries hold all material licenses, certificates
of occupancy or operation and similar certificates and clearances of municipal
and other authorities necessary to own and operate their properties in the
manner and for the purposes currently operated by such parties the absence of
which would, individually or in the aggregate, have a Material Adverse Effect.
Neither US Borrower nor any Subsidiary has received written notice of defaults
of a material nature with respect to any leases of real property under which US
Borrower or any Subsidiary, is lessor or lessee that would, individually or in
the aggregate, have a Material Adverse Effect.
6.11. Taxes. US Borrower and each Subsidiary (and their
predecessors, if any, for whose tax liabilities such Person is or may be liable)
has filed all tax returns reports and forms required to be filed by it and has
paid all material taxes and assessments shown to be due thereon or for which a
notice of assessment or deficiency has been received, except for those
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contested in good faith and for which adequate reserves have been established in
accordance with GAAP, and except where failure would not, individually or in the
aggregate, have a Material Adverse Effect. US Borrower and any Subsidiary has
paid, or provided adequate reserves (established in accordance with GAAP) for
the payment of, all Federal, state, local and foreign income taxes (including
franchise taxes based upon income) applicable for all prior fiscal years and for
the current fiscal year to the date hereof, except where failure would not,
individually or in the aggregate, have a Material Adverse Effect. Neither
Borrower knows of any proposed tax assessment against US Borrower or any
Subsidiary that would, individually or in the aggregate, have a Material Adverse
Effect, other than any assessment which is being actively contested in good
faith by such Borrower or Subsidiary to the extent affected thereby and for
which reserves or other appropriate provisions, if any, as shall be required in
conformity with GAAP shall have been made or provided therefor.
6.12. Environmental Matters. (A) Except as disclosed in Schedule
6.12 and except as would not, individually or in the aggregate, have a Material
Adverse Effect:
(i) US Borrower and each Subsidiary has obtained all permits,
licenses and other authorizations which are required under any
Environmental Law with respect to the operation of the businesses and
facilities and properties owned, leased or operated by any of them
including, without limitation, any joint ventures.
(ii) US Borrower and each Subsidiary is in compliance with all terms
and conditions of the permits, licenses and authorizations specified in
subsection (i) above, and is also in compliance with, and has no liability
under, any Environmental Laws applicable to it and its business and
operations and facilities and properties owned, leased or operated by any
of them.
(iii) Neither US Borrower nor any Subsidiary has received written
notice that it has been identified as a potentially responsible party
under the Comprehensive Environmental Response, Compensation and Liability
Act of 1980, as amended ("CERCLA"), or any comparable foreign or state
law, nor has US Borrower or any Subsidiary received any written
notification that any Hazardous Materials that it, or any of their
respective predecessors in interest has used, generated, stored, treated,
handled, transported or disposed of, or arranged for disposal or treatment
of, or arranged with a transporter for transport for disposal or treatment
of, have been found at any site at which any governmental agency or
private party is conducting or plans to conduct a remedial investigation
or other action pursuant to any Environmental Law.
(iv) There have been no releases (i.e., any past or present
releasing, spilling, leaking, pumping, pouring, emitting, emptying,
discharging, injecting, escaping,
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leaching, disposing or dumping) of Hazardous Materials by US Borrower or
any Subsidiary or, to the knowledge of the Borrowers, their respective
predecessors in interest on, at, upon, into or from any facilities or
properties owned, leased, or operated by any of them. To the knowledge of
the Borrowers, there have been no such releases of Hazardous Materials on,
at, under or from any property adjacent to any Mortgaged Real Property
that, through soil, air, surface water or groundwater migration or
contamination, may reasonably have been expected to have migrated to or
under any Mortgaged Real Property.
(v) No properties now or formerly owned, leased or operated by US
Borrower or any Subsidiary are (i) listed or proposed for listing on the
National Priorities List under CERCLA or (ii) listed in the Comprehensive
Environmental Response, Compensation, Liability Information System List
promulgated pursuant to CERCLA or (iii) to the knowledge of the Borrowers,
included on any comparable lists maintained by any Governmental Authority.
(vi) To the knowledge of the Borrowers, there are no past or present
events, conditions, activities, practices, or actions which would
reasonably be expected to prevent US Borrower's and its Subsidiaries'
compliance with any Environmental Law, or which would reasonably be
expected to give rise to any liability under any Environmental Law,
including, without limitation, liability under CERCLA or similar state,
local or foreign laws.
(vii) No Lien has been asserted or recorded, or to the knowledge of
the Borrowers threatened under any Environmental Law with respect to any
assets, facility, inventory or property owned, leased or operated by US
Borrower or any Subsidiary.
(viii) Neither US Borrower nor any Subsidiary has assumed by
contract any liabilities or obligations arising under any Environmental
Law in connection with (i) any properties or facilities currently or
formerly (a) owned, leased or operated or (b) used for the storage or
disposal of Hazardous Materials, in each case by US Borrower or any
Subsidiary (or any of their respective predecessors in interest) or (ii)
any divisions, subsidiaries, companies or other entities formerly owned by
US Borrower or any Subsidiary.
(ix) Neither US Borrower nor any Subsidiary has entered into or
agreed to any currently pending or effective judgment, decree or order by
any judicial or administrative tribunal and are not subject to any
judgment, decree or order relating to compliance with any Environmental
Law or to investigation, response or corrective action with respect to any
Hazardous Material under any Environmental Law.
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(x) Neither US Borrower nor any Subsidiary has received any written
notice of an Environmental Claim with regard to any properties, facilities
or business operated or formerly operated by US Borrower or any Subsidiary
or any of their respective predecessors in interest.
(xi) To the knowledge of Borrowers, there are no underground storage
tanks or related piping at any property owned, operated or leased by US
Borrower or any Subsidiary, and any former underground tanks or related
piping on any such property have been removed or closed in accordance with
any applicable Environmental Law.
(B) Environmental Documents. To the knowledge of the Borrowers, all
environmental investigations, studies, audits or assessments in the possession
or control of US Borrower or any Subsidiary ("Reports") concerning any violation
or potential violation of, or liability or potential liability under, any
Environmental Law relating to any current or prior business, facilities or
properties of US Borrower or any Subsidiary (or any of their respective
predecessors in interest) or any property, asset or facility currently or
formerly (i) owned, operated or leased or (ii) used for the storage or disposal
of Hazardous Materials, in each case by US Borrower or any Subsidiary (or any of
their respective predecessors in interest) have been made available to the
Arranger, except for Reports concerning such violation or liability,
individually or in the aggregate, which would not have a Material Adverse
Effect.
6.13. Regulated Entities. No Loan Party is an "Investment Company"
or a company "controlled" by an "investment company" within the meaning of the
Investment Company Act of 1940. Neither of the Borrowers nor any other Loan
Party is subject to regulation under the Public Utility Holding Company Act of
1935, the Federal Power Act, the Interstate Commerce Act, any state public
utilities code, or any other Federal or state statute or regulation limiting its
ability to incur Indebtedness.
6.14. Employee and Labor Matters. There is (i) no unfair labor
practice complaint pending against US Borrower or any Subsidiary or, to the best
knowledge of the Borrowers, threatened against any of them, before the National
Labor Relations Board, and no grievance or arbitration proceeding arising out of
or under any collective bargaining agreement is so pending against US Borrower
or any Subsidiary or, to the best knowledge of the Borrowers, threatened against
any of them, (ii) no strike, labor dispute, slowdown or stoppage pending against
US Borrower or any Subsidiary or, to the best knowledge of the Borrowers,
threatened against US Borrower or any Subsidiary and (iii) to the best knowledge
of the Borrowers, no union representation question existing with respect to the
employees of US Borrower or any Subsidiary and, to the best knowledge of the
Borrowers, no union organizing activities are taking place, except (with respect
to any matter specified in clause (i), (ii) or (iii) above, either individually
or in the aggregate) such as would not have a Material Adverse Effect.
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6.15. Intellectual Property. To the knowledge of the Borrowers, US
Borrower and each Subsidiary owns or possesses adequate licenses or otherwise
has the right to use all of the patents, patent applications, trademarks,
trademark applications, service marks, service mark applications, trade names,
copyrights, trade secrets and know-how (whether domestic or foreign)
(collectively, "Intellectual Property") that are necessary for the operation of
its business as presently conducted, except where the failure to so own or
possess licenses or rights would not, individually or in the aggregate, have a
Material Adverse Effect. To the knowledge of US Borrower and the Subsidiaries,
no claim is pending that US Borrower or any Subsidiary infringe upon the
asserted rights of any other Person under any Intellectual Property, except for
any such claim which would not, individually or in the aggregate, have a
Material Adverse Effect. To the knowledge of the Borrowers, no claim is pending
that any such Intellectual Property owned or licensed by US Borrower or any
Subsidiary or which US Borrower or any Subsidiary otherwise have the right to
use, is invalid or unenforceable, except for any such claim which would not,
individually or in the aggregate, have a Material Adverse Effect.
Except as set forth in Schedule 6.15, US Borrower or a Subsidiary
owns or has the right to use all Intellectual Property listed in Schedule 6.15
and the consummation of the transactions contemplated hereby will not, alter or
impair any such rights in a way that would, individually or in the aggregate,
have a Material Adverse Effect. Subject to the rights of third parties set forth
in Schedule 6.15, all Intellectual Property listed in Schedule 6.15 is free and
clear of all Liens except such as would not, individually or in the aggregate,
have a Material Adverse Effect.
6.16. Subsidiaries. As of the Closing Date, US Borrower has no
Subsidiaries other than those specifically disclosed in part (a) of Schedule
6.16 hereto and has no equity investments in any other corporation or entity
other than those specifically disclosed in part (b) of Schedule 6.16.
6.17. Existing Indebtedness. Schedule 6.17 sets forth a true and
complete list of all Indebtedness of US Borrower and the Subsidiaries as of the
Closing Date and which is to remain outstanding after giving effect to the
Transactions and the incurrence of Loans on such date (excluding the Loans, the
Letters of Credit and the Senior Subordinated Notes, the "Existing
Indebtedness"), in each case showing the aggregate principal amount thereof and
the name of the respective borrower and any other entity which directly or
indirectly guaranteed such debt.
6.18. True and Complete Disclosure. All factual information (taken
as a whole) heretofore or contemporaneously furnished by or on behalf of the
Borrowers and the other Loan Parties in writing to any Lender (including,
without limitation, all information contained in the M-T Acquisition Documents,
the Basic Documents and the Confidential Memorandum) for
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purposes of or in connection with this Agreement or any transaction contemplated
herein is (or was, on the date of making the Initial Loans), and all other such
factual information (taken as a whole) hereafter furnished by or on behalf of
the Borrowers in writing to any Lender will be, true and accurate in all
material respects on the date as of which such information is dated or certified
and not incomplete by omitting to state any material fact necessary to make such
information, taken as a whole, not misleading at such time in light of the
circumstances under which such information was provided. The projections and pro
forma financial information contained in or to be contained in such materials
(including the pro forma balance sheet furnished pursuant to Section 5.1(l), the
projections included in the Confidential Memorandum, and the budgets to be
furnished pursuant to Section 7.1(d)) are based on good faith estimates and
assumptions believed by the Borrowers 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, that actual results during the period or periods
covered by any such projections may differ materially from the projected results
and that the Borrowers make no representation or warranty that such projections,
pro forma results or budgets will be realized. There is no fact known to either
Borrower which materially and adversely affects the business, operations,
property, assets, nature of assets, liabilities, condition (financial or
otherwise) or prospects of US Borrower and the Subsidiaries, taken as a whole,
which has not been disclosed herein or in such other documents, certificates and
written statements furnished to the Lenders for use in connection with the
transactions contemplated hereby.
6.19. Security Interests. The Security Documents, once executed,
delivered, filed and/or recorded will create, in favor of the Administrative
Agent for the benefit of the Lenders, as security for the obligations purported
to be secured thereby, a valid and enforceable perfected first priority security
interest in and Lien upon all of the Collateral, superior to and prior to the
rights of all third persons and subject to no Liens except the Prior Liens
applicable to such Collateral and Permitted Liens. The mortgagor under each
Mortgage has good and marketable title to the Mortgaged Real Property free and
clear of all Liens other than Permitted Liens and Prior Liens applicable to such
Mortgaged Real Property. The respective pledgor or assignor, as the case may be,
has (or on and after the time it executes the respective Security Document, will
have) good and marketable title to all items of Collateral (other than real
property subject to a Mortgage) covered by such Security Document free and clear
of all Liens other than Liens permitted by the applicable Security Document. No
filings or recordings are required in order to perfect the security interests
created under any Security Document delivered on the Closing Date, except for
filings or recordings required in connection with any such Security Document as
set forth in the opinions of counsel delivered on the Closing Date.
6.20. Representations and Warranties in Basic Documents. All
representations and warranties set forth in the other Basic Documents were (with
respect to representations and warranties of parties other than the Loan
Parties, to the knowledge of the Borrowers) true and
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correct in all material respects as of the time such representations and
warranties were made and shall be true and correct in all material respects as
of the Closing Date as if such representations and warranties were made on and
as of such date, unless stated to relate to a specific earlier date, in which
case such representations and warranties shall be true and correct in all
material respects as of such earlier date.
6.21. M-T Acquisition. At the time of consummation thereof, the M-T
Acquisition shall have been consummated substantially in accordance with the
terms of the M-T Acquisition Documents and all applicable Requirements of Law.
At the time of consummation thereof, all consents and approvals of, and filings
and registrations with, and all other actions in respect of, all governmental
agencies, authorities or instrumentalities required to make or consummate the
M-T Acquisition have been obtained, given, filed or taken or waived and are or
will be in full force and effect (or effective judicial relief with respect
thereto has been obtained), except as set forth on Schedule 6.21 and except
where the failure to obtain, give, file, or take would not have a Material
Adverse Effect. All applicable waiting periods with respect thereto have or,
prior to the time when required, will have, expired without, in all such cases,
any action being taken by any competent Governmental Authority which restrains,
prevents, or imposes material adverse conditions upon the M-T Acquisition.
Additionally, there does not exist any judgment, order or injunction prohibiting
or imposing material adverse conditions upon the M-T Acquisition or the
performance by US Borrower and the Subsidiaries of their obligations under the
M-T Acquisition Documents and all applicable Requirements of Law.
6.22. Broker's Fees. Except as disclosed in Schedule 6.22, no
broker's or finder's fee or commission will be payable with respect to this
Agreement or any of the Transactions contemplated hereby, and the Borrowers
hereby jointly and severally indemnify the Agents and the Lenders against, and
agree that they will jointly and severally hold the Agents and the Lenders
harmless from, any claim, demand or liability for any such broker's or finder's
fees alleged to have been incurred in connection herewith or therewith and any
expenses (including fees, expenses and disbursements or counsel) arising in
connection with any such claim, demand or liability.
6.23. Senior Subordinated Notes. The subordination provisions
contained in the Senior Subordinated Note Documents are enforceable against US
Borrower and each of its Subsidiaries party thereto, and all Obligations are
within the definition of "Senior Indebtedness" or "Guarantor Senior
Indebtedness", as the case may be, included in such subordination provisions.
Senior Subordinated Notes, when issued and sold, will either (a) have been
registered or qualified under applicable federal and state securities laws or
(b) be exempt therefrom. The offering documents for the issuance and sale of the
Senior Subordinated Notes, as of their date, did not contain an untrue statement
of material fact or omit to state a material fact required to be stated therein
or necessary to make the statement therein not misleading.
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6.24. Assignment of Rights Under M-T Acquisition Documents. All
rights of MT Investors Inc. (formerly named AEA MT Inc.) under the M-T
Acquisition Documents will be assigned to US Borrower effective upon the
consummation of the merger of US Borrower and Mettler-Toledo, Inc., to
Mettler-Toledo, Inc. by operation of law.
ARTICLE VII.
AFFIRMATIVE COVENANTS
So long as any Lender shall have any Commitment hereunder, or any
Loan or other Obligation shall remain unpaid or unsatisfied, or any Letter of
Credit shall remain outstanding:
7.1. Financial Statements, etc. The Borrowers shall deliver to the
Administrative Agent and each Lender, in form and detail satisfactory to the
Administrative Agent and the Required Lenders:
(a) as soon as available, but not later than 90 days after the end
of each fiscal year, a copy of the audited consolidated (and consolidating
with respect to CH Borrower and its Subsidiaries on a consolidated basis)
balance sheet of US Borrower and the Subsidiaries as at the end of such
year and the related consolidated (and consolidating with respect to CH
Borrower and its Subsidiaries on a consolidated basis) statements of
operations, retained earnings, shareholders' equity and cash flow for such
year, setting forth in each case in comparative form the corresponding
consolidated figures for the previous fiscal year and comparable budgeted
figures for such fiscal year, and, in the case of the consolidated
statements, accompanied by the opinion of KPMG Fides Peat or another
nationally recognized independent certified public accounting firm
selected by the Borrowers and reasonably acceptable to the Administrative
Agent ("Independent Auditor"), which opinion (i) shall state that such
consolidated financial statements present fairly the consolidated
financial position and results of operations of US Borrower and the
Subsidiaries for the periods indicated in conformity with GAAP and (ii)
shall not be qualified or limited because of a restricted or limited
examination by the Independent Auditor of any material portion of US
Borrower's or any Subsidiary's records and shall be delivered to the
Administrative Agent pursuant to a reliance agreement between the
Administrative Agent and Lenders and such Independent Auditor in form and
substance satisfactory to the Agents and a certificate of such accountants
stating that in the course of its regular audit of the business of US
Borrower and the Subsidiaries no Event of Default or Unmatured Event of
Default which has occurred and is continuing has come
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to their attention or, if such an Event of Default or Unmatured Event of
Default has come to their attention, a statement as to the nature thereof;
(b) as soon as available, but not later than 45 days after the end
of each of the fiscal quarters of each fiscal year, a copy of the
consolidated (and consolidating with respect to CH Borrower and its
Subsidiaries on a consolidated basis) balance sheet of US Borrower and the
Subsidiaries as of the end of such quarter and the related consolidated
(and consolidating with respect to CH Borrower and its Subsidiaries on a
consolidated basis) statements of operations, retained earnings and cash
flow for the period commencing on the first day and ending on the last day
of such quarter, and (except with respect to the fourth fiscal quarter)
the period from the beginning of the respective fiscal year to the end of
such quarter, setting forth in each case in comparative form the
corresponding consolidated figures for the corresponding period in the
previous fiscal year, accompanied by a certificate of a Responsible
Officer, which certificate shall state that said consolidated financial
statements fairly present, in accordance with GAAP (subject to ordinary,
good-faith year-end adjustments), the consolidated financial position and
the results of operations of US Borrower and the Subsidiaries;
(c) within 60 days after the commencement of each fiscal year,
budgets of US Borrower and the Subsidiaries in reasonable detail for each
fiscal quarter of such fiscal year and for each fiscal quarter of the
immediately succeeding fiscal year, in each case, as customarily prepared
by management for its internal use, setting forth, with appropriate
discussion, the principal assumptions upon which such budgets are based.
Together with each delivery of statements of operations pursuant to
subsection 7.1(b), a comparison of the current year-to-date financial
results against the budgets required to be submitted pursuant to this
subsection (c) shall be presented; and
(d) promptly upon receipt thereof, a copy of each report or
"management letter" submitted to US Borrower or any Subsidiary by its
independent accountants in connection with any annual, interim or special
audit made by them of the books of US Borrower or any Subsidiary.
7.2. Certificates; Other Information. The Borrowers shall furnish to
the Administrative Agent and each Lender:
(a) concurrently with the delivery of the financial statements
referred to in subsections 7.1(a) and (b), a Compliance Certificate
executed by a Responsible Officer stating that the Loan Parties are in
compliance with the covenants set forth under this Article VII and Article
VIII;
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(b) on and after the Reset Date, together with the financial
statements delivered pursuant to subsections 7.1(a) and 7.1(b), an
Interest Rate Certificate;
(c) copies of all financial statements and regular, periodical or
special reports that US Borrower or any Subsidiary may make to, or file
with, the SEC if not otherwise delivered under Section 7.1; and
(d) as soon as practicable, such additional information regarding
the business, financial or corporate affairs of US Borrower or any
Subsidiary as the Administrative Agent or any Lender (through the
Administrative Agent) may from time to time reasonably (as to type and
interval) request.
7.3. Notices. Promptly upon a Responsible Officer learning thereof,
the Borrowers shall notify the Administrative Agent and each Lender:
(a) of the occurrence of any Event of Default or Unmatured Event of
Default;
(b) of any of the following matters that has resulted in a Material
Adverse Effect: (i) any breach or non-performance of, or any default
under, a Contractual Obligation of US Borrower or any Subsidiary; (ii) any
dispute, litigation, investigation, proceeding or suspension by or before
any Governmental Authority affecting US Borrower or any Subsidiary; or
(iii) to the knowledge of the Borrowers the commencement of, or any
material development in, any litigation or proceeding affecting US
Borrower or any Subsidiary, including pursuant to any applicable
Environmental Laws;
(c) of the occurrence of any of the following events if such event
has resulted or could reasonably be expected to result in any Material
Adverse Effect or in a Lien under ERISA or the Code (but in no event more
than ten days after such event), and deliver to the Administrative Agent
and each Lender a copy of any notice with respect to such event that is
filed with a Governmental Authority and any notice delivered by a
Governmental Authority to the Loan Party or any ERISA Affiliate with
respect to such event, and upon the request of the Administrative Agent or
any Lender shall furnish any Schedule B (Actuarial Information) to the
annual report (Form 5500 Series) filed by any Loan Party or ERISA
Affiliate with the Internal Revenue Service with respect to any Pension
Plan: (i) an ERISA Event; (ii) the adoption after the date hereof of, or
the commencement after the date hereof of contributions to, any Plan
subject to Section 412 of the Code by US Borrower or any ERISA Affiliate;
or (iii) the adoption after the date hereof of any amendment to a Plan
subject to Section 412 of the Code;
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(d)(i) of any pending or threatened Environmental Claim against US
Borrower or any Subsidiary or any Real Property owned or operated by US
Borrower or any Subsidiary that would, singly or in the aggregate, have a
Material Adverse Effect; (ii) of any condition or occurrence on any Real
Property owned or operated by US Borrower or any Subsidiary that (x)
results in noncompliance by US Borrower or any Subsidiary with any
applicable Environmental Law or (y) would form the basis of an
Environmental Claim against US Borrower or any Subsidiary or any such Real
Property in each case to the extent that any such noncompliance or
Environmental Claim would, singly or in the aggregate, have a Material
Adverse Effect; and (iii) of any condition or occurrence on any Real
Property owned or operated by US Borrower or any Subsidiary that could
reasonably be expected to cause such Real Property to be subject to any
restrictions on the ownership, occupancy, use or transferability by US
Borrower or any Subsidiary, as the case may be, of its interest in such
Real Property under any Environmental Law which condition or occurrence
would, singly or in the aggregate, have a Material Adverse Effect; and
(e) of the occurrence of any default or event of default under the
Senior Subordinated Notes.
Each notice under this Section shall be accompanied by a written
statement by a Responsible Officer setting forth details of the occurrence
referred to therein, and stating what action the Borrowers or any affected
Subsidiary proposes to take with respect thereto.
7.4. Preservation of Corporate Existence, etc. The Borrowers shall,
and shall cause each of their respective Subsidiaries to: (a) preserve and
maintain in full force and effect its existence and good standing under the laws
of its state or jurisdiction of organization, except in a transaction permitted
by Section 8.3; (b) preserve and maintain in full force and effect all material
governmental rights, privileges, qualifications, permits, licenses and
franchises necessary in the normal conduct of its business, except in connection
with transactions permitted by Section 8.3 and sales of assets permitted by
Section 8.2; (c) use reasonable efforts, in the ordinary course of business, to
preserve its business organization and goodwill; (d) preserve or renew all of
its Intellectual Property, the non-preservation of which would, singly or in the
aggregate, have a Material Adverse Effect; and (e) comply in all material
respects with all material Requirements of Law of any Governmental Authority
having jurisdiction over it or its business if failure to comply with such
requirements would, singly or in the aggregate, have a Material Adverse Effect,
except, in the case of clauses (a) (with respect to any Subsidiary which is of
de minimus significance to US Borrower and the Subsidiaries taken as a whole),
(b), (c) and (d), to the extent no longer economically desirable, in the
commercially reasonable opinion of management and except for the M-T
Acquisition.
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7.5. Maintenance of Property; Insurance. (a) Each Borrower will, and
will cause each of its Subsidiaries to exercise commercially reasonable efforts
to maintain or cause to be maintained in good repair, working order and
condition (subject to normal wear and tear) all properties used in its
businesses and from time to time will make or cause to be made all repairs,
renewals and replacements thereof, which the applicable Borrower or the
applicable Subsidiary deems appropriate in its commercially reasonable opinion
so that the business carried on in connection therewith may be properly and
advantageously conducted and will maintain and renew as necessary all licenses,
permits and other clearances reasonably necessary in the applicable Borrower's
or the applicable Subsidiary's commercially reasonable opinion to use and occupy
such properties, except to the extent no longer economically desirable in the
commercially reasonable opinion of the applicable Borrower or the applicable
Subsidiary.
(b) The Borrowers shall, and shall cause each of their respective
Subsidiaries to, maintain in full force and effect, with financially sound and
reputable independent insurers, insurance or reinsurance with respect to their
properties and business against loss or damage of the kinds customarily insured
against by corporations of established reputation engaged in the same or similar
business and similarly situated, of such types and in such amounts as are
customarily carried under similar circumstances by such other corporations. The
Borrowers and each of their respective Subsidiaries, as applicable, shall
furnish to the Administrative Agent on the Closing Date a summary of the
material insurance carried in respect of US Borrower and the Subsidiaries and
the assets of US Borrower and the Subsidiaries, together with certificates of
insurance and other evidence of such insurance, if any, naming the
Administrative Agent as an additional insured and/or loss payee.
(c) Without duplicating the requirements of subsection 7.5(b) above,
each Borrower will, and will cause each of its Subsidiaries to, maintain in full
force the insurance coverages specified in the Mortgages and the other Security
Documents.
7.6. Payment of Obligations. The Borrowers shall, and shall cause
each of their respective Subsidiaries to, pay and discharge as the same shall
become due and payable all of their obligations and liabilities, including: (a)
all material tax liabilities, assessments and governmental charges or levies
upon them or their properties or assets; and (b) all lawful claims which, if
unpaid, would by law become a Lien (other than a Permitted Lien) upon their
property; unless, in each case, the same are being contested in good faith by
appropriate proceedings and adequate reserves in accordance with GAAP are being
maintained by such Borrower or such Subsidiary with respect thereto, or the
failure to so pay or discharge would not, individually or in the aggregate, have
a Material Adverse Effect.
7.7. Compliance with Environmental Laws. (a) Each Borrower shall
comply and if any of its Subsidiaries fails to comply, shall cause such
Subsidiary to comply with all
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Environmental Laws; (b) each Borrower will pay, and, if any of its Subsidiaries
fails to pay, will cause each such Subsidiary to pay, all costs and expenses
incurred by it in complying in all material respects with all Environmental
Laws, and will keep or cause to be kept all Real Property owned, operated or
leased by any of them free and clear of any Liens imposed pursuant to such
Environmental Laws unless the failure to comply with these requirements
specified in clause (a) or (b) above would not, individually or in the
aggregate, have a Material Adverse Effect; (c) in the event of the presence of
any Hazardous Material at, on, under or upon any property owned, operated or
leased by either Borrower or any Subsidiary which would reasonably be expected
to result in liability under or a violation of any Environmental Law, in each
case which would, individually or in the aggregate, have a Material Adverse
Effect, the Borrowers agree to undertake, and/or to cause any of their
respective Subsidiaries, tenants or occupants to undertake, at their sole
expense, any investigation, removal, remedial or other action required pursuant
to Environmental Laws to mitigate and eliminate any such adverse effect;
provided, however, that neither Borrower nor any of their respective
Subsidiaries shall be required to comply with any order or directive which is
being contested in good faith and by proper proceedings so long as it has
maintained adequate reserves with respect to such compliance to the extent
required in accordance with GAAP; and (d) each Borrower shall as promptly as
practicable notify the Administrative Agent of the occurrence of any event
specified in clause (c) of this Section 7.7 and shall thereafter keep the
Administrative Agent informed on a periodic basis of any actions taken in
response to such event and the results of such actions.
7.8. Compliance with ERISA. The Borrowers shall, and shall cause
each of their respective ERISA Affiliates to: (a) maintain each Plan in
compliance in all material respects with the applicable provisions of ERISA, the
Code and other applicable law; (b) cause each Plan which is qualified under
Section 401(a) of the Code to maintain such qualification; and (c) make all
required contributions to any Plan subject to Section 412 of the Code, except
where failure would not, individually or in the aggregate, have a Material
Adverse Effect.
7.9. Inspection of Property and Books and Records. The Borrowers
shall, and shall cause each of their respective Subsidiaries to, maintain proper
books of record and account, in which full, true and correct entries in order to
permit the preparation of US Borrower's consolidated financial statements in
conformity with GAAP shall be made of all financial transactions and matters
involving the assets and business of US Borrower and the Subsidiaries. The
Borrowers shall, and shall cause each of their respective Subsidiaries to,
permit representatives and independent contractors of the Administrative Agent
or any Lender to visit and inspect any of their respective properties or assets,
to examine their respective corporate, financial and operating records, and make
copies thereof or abstracts therefrom, and to discuss their respective affairs,
finances and accounts with their respective directors, officers, and independent
public accountants (provided that officers of a Borrower or such Subsidiary are
offered the reasonable opportunity to be present at such discussion), all at the
expense of the
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Borrowers (it being understood that travel and out-of-pocket expenses of the
Agents and the Lenders in connection therewith shall not be for the account of
the Borrowers) and at such reasonable times and intervals during normal business
hours and as often as may be reasonably desired, upon reasonable advance notice
to the Borrowers or to the applicable Subsidiary and in connection with
commercially reasonable informational needs of the Administrative Agent or any
Lender; provided, however, when an Event of Default or emergency exists the
Administrative Agent or any Lender may do any of the foregoing at any time and
without advance notice in a commercially reasonable manner.
7.10. End of Fiscal Years; Fiscal Quarters. US Borrower will, for
financial reporting purposes, cause (i) each of its, and each of its
Subsidiaries', fiscal years to end on December 31 of each year and (ii) each of
its, and each of its Subsidiaries', fiscal quarters to end on March 31, June 30,
September 30 and December 31 of each year.
7.11. Use of Proceeds. On the Closing Date, the Borrowers shall use
the proceeds of all of the Term Loans and a borrowing of not more than U.S. $75
million of the Revolving Facility Loans solely to (i) finance a portion of the
M-T Acquisition and (ii) pay fees and expenses in connection with the M-T
Acquisition. After the Closing Date, the Revolving Facility will be used solely
to provide working capital and for general corporate purposes of the Borrowers
and their Subsidiaries and to make the Ciba Loan.
7.12. Further Assurances. The Borrowers shall take such actions as
are reasonably necessary, or as the Administrative Agent or any Lender may
reasonably request from time to time, to ensure that the Obligations of the
Borrowers are unconditionally guaranteed by each of the Domestic Subsidiaries
and the Obligations of CH Borrower are unconditionally guaranteed (subject to
limitations under applicable law) by each of the CH Foreign Subsidiaries (other
than, subject to Section 7.22, the Specified Subsidiaries) and cause any future
Subsidiaries created or acquired by either of the Borrowers to execute a
Domestic Subsidiary Guarantee, in the case of any Domestic Subsidiary, or
Foreign Subsidiary Guarantee (to the extent permitted by and subject to
limitations under applicable law (including limitations as to the nature of the
Obligations which may be guaranteed)), in the case of any CH Foreign
Subsidiaries (other than any CH Foreign Subsidiary that cannot, by virtue of
applicable law, enter into a Foreign Subsidiary Guarantee), and (other than,
subject to Section 7.22, any Specified Subsidiary or any Subsidiary that cannot,
by virtue of applicable law, enter into security documents in respect of the
Obligations) enter into any other security documents that the Administrative
Agent may reasonably require and are secured by perfected Liens in favor of the
Administrative Agent, for the benefit of the Administrative Agent and the
applicable Lenders, on all of the Collateral (subject to limitations under
applicable law).
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7.13. Equal Security for Loans and Notes; No Further Negative
Pledges. (a) If either Borrower or any of their respective Subsidiaries shall
create or assume any Lien upon any of their respective property or assets,
whether now owned or hereafter acquired and whether or not such property or
assets constitute Collateral, other than any Lien permitted by the Loan
Documents, it shall make or cause to be made effective provisions whereby the
Obligations will be secured by such Lien equally and ratably with any and all
other Indebtedness thereby secured as long as any such Indebtedness shall be
secured; provided, however, that this covenant shall not be construed as consent
by the Administrative Agent and the Required Lenders to any violation by either
Borrower or any of their respective Subsidiaries of the provisions of Section
8.1.
(b) Except with respect to prohibitions against other encumbrances
on specific property encumbered to secure payment of particular Indebtedness
permitted hereunder, neither Borrower nor any of their respective Subsidiaries
shall enter into any agreement prohibiting the creation or assumption of any
Lien upon its properties or assets, whether now owned or hereafter acquired.
7.14. Pledge of Additional Collateral. Subject to Section 7.13, as
soon as reasonably practicable after the acquisition of any property or assets
with a Dollar Equivalent Value of in excess of U.S. $100,000 individually and
$5.0 million or more in the aggregate of the type that would have constituted
Collateral (if the Person acquiring such assets had executed an appropriate
Security Document on the Closing Date (whether or not actually so executed)) at
the Closing Date (the "Additional Collateral"), the Borrowers will, and will
cause each of their respective Subsidiaries to, take all reasonably necessary or
desirable action, including the filing of appropriate financing statements under
the provisions of the UCC and applicable foreign, domestic or local laws, rules
or regulations in each of the offices where such filing is necessary or
appropriate, to grant to the Administrative Agent for the benefit of, with
respect to US Borrower or any Domestic Subsidiary, all of the Lenders and, with
respect to CH Borrower and CH Foreign Subsidiaries, the Lenders owed Obligations
by CH Borrower and/or CH Foreign Subsidiaries, a perfected first priority Lien
in such Collateral (or comparable interest under foreign law in the case of
foreign Collateral) pursuant to and to the full extent required by the
applicable Security Documents and this Agreement; provided, however, that
notwithstanding the foregoing, (i) none of US Borrower or any Domestic
Subsidiary shall be required, subject to Section 7.18, to pledge more than 65%
of the capital stock of any Foreign Subsidiary, (ii) none of US Borrower or any
Subsidiary shall be required, subject to Section 7.18, to pledge any property or
assets which in accordance with the terms of the Loan Documents was not pledged
(or would not have been so pledged if then in existence) on the Closing Date and
(iii) no Foreign Subsidiary need pledge any property or assets to the extent
prohibited by applicable law or to the extent such pledge would cause adverse
tax consequences. In the event that (x) US Borrower or any Domestic Subsidiary
acquires an interest in any
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additional real property which is a manufacturing or significant assembly
facility or of a character and importance similar at such time to the facilities
that are subject to the Mortgages on the Closing Date, US Borrower or such
Subsidiary, as the case may be, will take such reasonable actions and execute
such documents as the Administrative Agent shall reasonably require to confirm
the Lien of a Mortgage, if applicable, or to create a new Mortgage for the
benefit of the Lenders or (y) CH Borrower or any CH Foreign Subsidiary acquires
an interest in any additional real property which is a manufacturing or
significant assembly facility or of a character and importance similar at such
time to the facilities that are subject to the Mortgages on the Closing Date, CH
Borrower or such Subsidiary, as the case may be, will take such reasonable
actions and execute such documents as the Administrative Agent will reasonably
require to confirm the lien of a Mortgage, if applicable, or to create a new
Mortgage for the benefit of the Lenders which are owed Obligations by CH
Borrower or any CH Foreign Subsidiary. All actions taken by the parties in
connection with the pledge of Additional Collateral, including, without
limitation, reasonable costs of counsel for the Lenders, shall be for the
account of the Borrowers, which shall pay all reasonable sums due on demand.
7.15. Security Interests. (a) The Borrowers will, and will cause
each of their respective Subsidiaries to, perform any and all reasonable acts
and execute any and all documents (including, without limitation, the execution,
amendment or supplementation of any financing statement, continuation statement
or other statement) for filing in any appropriate jurisdiction under the
provisions of the UCC and applicable foreign, domestic or local law or any
statute, rule or regulation of any applicable jurisdiction, including any
filings in local real estate land record offices and the United States Patent
and Trademark Office, or the United States Copyright Office, which are
reasonably necessary or advisable, from time to time, in order to grant,
continue or maintain in favor of the Administrative Agent for the benefit of the
applicable Lenders a valid and perfected Lien on the Collateral and any
Additional Collateral, subject to no Liens except for Prior Liens, Permitted
Liens and Liens permitted by the applicable Security Documents.
(b) The Borrowers shall, and shall cause each of their respective
Subsidiaries to, deliver or cause to be delivered to the Administrative Agent
from time to time such other reasonable documentation, consents, authorizations,
approvals and orders in form and substance reasonably satisfactory to the
Administrative Agent as the Administrative Agent shall deem reasonably necessary
or advisable to perfect or maintain the Liens on the Collateral. Furthermore,
with respect to any Additional Collateral, the Borrowers shall cause to be
delivered to the Administrative Agent such opinions of counsel, title insurance
and other related documents as may reasonably be requested by the Administrative
Agent to assure itself that this Section 7.15 has been complied with.
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(c) If the Administrative Agent or the Required Lenders determine
that they are required by law or regulation to have appraisals prepared in
respect of the Real Property of the Borrowers and their respective Subsidiaries
constituting Collateral, the Borrowers shall provide to the Administrative Agent
appraisals which satisfy the applicable requirements of the Real Estate
Appraisal Reform Amendments of FIRREA and which shall be in form and substance
satisfactory to the Administrative Agent.
7.16. Interest Rate Protection. The Borrowers shall obtain, on or
within 90 days after the Closing Date, interest rate protection having terms and
with counterparties reasonably satisfactory to the Administrative Agent as shall
result in effectively limiting the interest cost to the Borrowers of 50% of the
aggregate Dollar Equivalent principal amount of then outstanding Term Loans for
a period of at least three years from the date the initial interest rate
protection was obtained.
7.17. Currency and Commodity Hedging Transactions. The Borrowers and
each of the Subsidiaries shall only enter into, purchase or otherwise acquire
agreements or arrangements relating to currency or commodity hedging to the
extent and only to the extent that such agreements or arrangements are entered
into, purchased or otherwise acquired in the ordinary course of business of the
Borrowers or any of the Subsidiaries with reputable financial institutions and
not for purposes of speculation.
7.18. Foreign Subsidiaries Security. If following a change in the
relevant sections of the Code or the regulations, rules, rulings, notices or
other official pronouncements issued or promulgated thereunder, counsel for the
Borrowers reasonably acceptable to the Arranger does not within 30 days after a
request from the Arranger or the Required Lenders deliver its opinion (in form
reasonably acceptable to the Arranger) with respect to any Foreign Subsidiary
which has not already had all of its stock owned by Holding or any of its
Subsidiaries pledged pursuant to a Securities Pledge Agreement, that (i) a
pledge to secure the Obligations of US Borrower or the Domestic Subsidiary
Guarantor which is the parent of such Foreign Subsidiary, as the case may be,
(x) of 66-2/3% or more of the total combined voting power of all classes of
capital stock of such Foreign Subsidiary entitled to vote and (y) of any
promissory note issued by such Foreign Subsidiary, if wholly-owned, to US
Borrower or any of its Domestic Subsidiaries, (ii) the entering into by such
Foreign Subsidiary, if wholly-owned, of a security agreement in substantially
the form of the Security Agreement executed and delivered by the Domestic
Subsidiary Guarantors (with appropriate modifications to conform to applicable
law) and (iii) the entering into by such Foreign Subsidiary, if wholly-owned, of
a guaranty in substantially the form of the Domestic Subsidiary Guarantee
guaranteeing the Obligations of US Borrower and CH Borrower, in any such case
could reasonably be expected to cause (I) the undistributed earnings of such
Foreign Subsidiary as determined for Federal income tax purposes to be treated
as a deemed dividend to such Foreign Subsidiary's United States parent for
Federal
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income tax purposes or (II) any other material adverse Federal income tax
consequences to the Loan Parties, then in the case of a failure to deliver the
opinion with respect to the factors described in clause (i) above, that portion
of such Foreign Subsidiary's outstanding capital stock or any promissory notes
so issued by such Foreign Subsidiary, in each case not theretofore pledged
pursuant to a Securities Pledge Agreement, shall be pledged to the
Administrative Agent pursuant to a Securities Pledge Agreement (with appropriate
modifications to conform to and subject to limitations of law) (or another
pledge agreement in substantially similar form, if needed) and, in the case of a
failure to deliver the opinion with respect to the factors described in clause
(ii) above, such Foreign Subsidiary shall execute and deliver a Security
Agreement in substantially the form executed and delivered by the Foreign
Subsidiary Guarantors (with appropriate modifications to conform to and subject
to limitations of law) (or another security agreement in substantially similar
form, if needed) securing the Obligations of US Borrower and CH Borrower and
their obligations under any Swap Agreement with a Lender and, in the event a
Guarantee guaranteeing the Obligations of US Borrower and/or CH Borrower shall
have been executed by such Foreign Subsidiary, the obligations of such Foreign
Subsidiary thereunder and, in the case of a failure to deliver the opinion with
respect to the factors described in clause (iii) above, such Foreign Subsidiary
shall execute and deliver a Guarantee guaranteeing the Obligations of US
Borrower and CH Borrower (with appropriate modifications to conform to and
subject to limitations of law) (or another guaranty in substantially similar
form, if needed), and their obligations under any Swap Agreement with a Lender,
in each case to the extent that the entering into of such Security Agreement or
Guarantee is permitted by the laws of the respective foreign jurisdiction and
with all documents delivered pursuant to this Section 7.18 to be in form and
substance reasonably satisfactory to the Arranger; provided, however, that such
Foreign Subsidiary shall not be required to pledge pursuant to a Foreign
Subsidiary Security Agreement any property or assets that it would not have been
required to pledge had it executed a Foreign Subsidiary Security Agreement at
the Closing Date.
7.19. Register. The Borrowers hereby designate the Administrative
Agent to serve as the Borrowers' agent, solely for purposes of this Section
7.19, to maintain a register (the "Register") on which it will record the
Commitment from time to time of each of the Lenders, the Loans made by each of
the Lenders (other than any Swing Line Loan made in other than U.S. Dollars or
Pounds Sterling) and each repayment in respect of the principal amount of the
Loans of each Lender (other than any Swing Line Loan made in other than U.S.
Dollars or Pounds Sterling). Failure to make any such recordation or any error
in such recordation shall not affect either Borrower's obligations in respect of
such Loans. The entries in the Register shall be conclusive, in the absence of
manifest error, and the applicable Borrower, the Administrative Agent and the
Lenders shall treat each Person whose name is recorded in the Register as the
owner of such a Loan or other obligation hereunder as the owner thereof for all
purposes of this Agreement and the other Loan Documents, notwithstanding any
notice to the contrary. With respect to any Lender, the transfer of any
Commitment of such Lender or the
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rights to the principal of, and interest on, any Loan (other than any Swing Line
Loan made in other than U.S. Dollars or Pounds Sterling) shall not be effective
until such transfer is recorded on the Register maintained by the Administrative
Agent with respect to ownership of such Commitment or Loans and prior to such
recordation all amounts owing to the transferor with respect to such Commitment
or Loans shall remain owing to the transferor. The registration of assignment or
transfer of all or part of any Commitment or Loans (other than any Swing Line
Loan made in other than U.S. Dollars or Pounds Sterling) shall be recorded by
the Administrative Agent on the Register only upon the acceptance by the
Administrative Agent of a properly executed and delivered Assignment and
Acceptance pursuant to Section 11.8. Coincident with the delivery of such an
Assignment and Acceptance to the Administrative Agent for acceptance and
registration of assignment or transfer of all or part of a Loan, or as soon
thereafter as practicable, the assigning or transferor Lender shall surrender
the Note evidencing such Loan and thereupon one or more new Notes in the same
aggregate principal amount shall be issued to the assigning or transferor Lender
and/or the new Lender. The Borrowers agree to indemnify the Administrative Agent
from and against any and all losses, claims, damages and liabilities of
whatsoever nature which may be imposed on, asserted against or incurred by the
Administrative Agent in performing its duties under this Section 7.19.
7.20. New Subsidiaries. In addition to their obligations with
respect to Sections 7.14, 7.15 and 7.18, if, after the Closing Date, the
Borrowers or any Subsidiary shall create or acquire any Subsidiary, the
Borrowers shall, concurrently with the creation or acquisition of such
Subsidiary, (i) cause such Subsidiary (other than (subject to Section 7.18) a
Foreign Subsidiary that is not a CH Foreign Subsidiary) to execute and deliver
to the Administrative Agent a Subsidiary Guarantee, substantially in the form of
Exhibit E-3 or E-4, as appropriate (with appropriate modifications to conform to
and subject to the limitations of foreign law), guaranteeing the applicable
Borrower's Obligations hereunder and (ii) take all necessary actions and execute
such agreements, instruments and documents, including, without limitation, stock
powers executed in blank, and deliver such opinions of counsel with respect
thereto, as the Administrative Agent may reasonably require to cause, subject to
Section 7.18, all, with respect to Domestic Subsidiaries, or at least 65% with
respect to Foreign Subsidiaries, of the capital stock of such Subsidiary owned
or controlled by the Borrowers to be pledged to the Administrative Agent to
secure the Obligations hereunder such that the Administrative Agent has a valid
and perfected first-priority security interest in such pledged capital stock or
the equivalent under applicable law.
7.21. Assumption by Mettler-Toledo, Inc. Holding shall cause MT
Acquisition Corp. and Mettler-Toledo, Inc. to enter into the Assumption
Agreement by the Closing Date.
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7.22. Post-Closing Obligations. (a) US Borrower shall, and shall
cause each of the Subsidiaries set forth on Schedule 7.22, to, as expeditiously
as possible after the Closing Date:
(i) execute and deliver each of the Loan Documents as set forth on
Schedule 7.22 identified thereon to be executed and delivered by such
Subsidiary, subject to limitations under applicable law and any required
third-party consents (which consents US Borrower shall use its best
efforts to procure but such efforts need not include the payment of
money);
(ii) use commercially reasonably efforts to obtain and deliver to
the Administrative Agent a Mortgage encumbering the Real Property located
in Ithaca, New York in favor of the Administrative Agent, for the benefit
of the Lenders, duly executed and acknowledged by the Loan Party that is
the owner of or holder of an interest in such real property and otherwise
in compliance with and in accordance with the provisions of subsection
5.1(j), except that any opinion of counsel in connection therewith need
only be customary for Mortgages of a similar nature;
(iii) request, and if obtained deliver to the Administrative Agent
zoning letters with respect to each Mortgaged Property, for which a zoning
endorsement from the title insurance company has not been obtained,
confirming that each such Mortgaged Property is in compliance with
applicable zoning regulations; and
(iv) obtain and deliver to the Administrative Agent, to the extent
not previously delivered prior to the Closing Date, UCC, judgment and the
tax lien search reports each of a recent date listing all effective
financing statements or comparable documents that name Mettler-Toledo,
Inc., as debtor in each of the jurisdictions set forth below:
(1) Maricopa County, Arizona;
(2) New Haven County, Connecticut;
(3) Howard County, Maryland;
(4) Oakland County, Michigan;
(5) Independent City of Richmond, Virginia;
(6) Independent City of Winchester, Virginia; and
(7) Hancock County, West Virginia.
(b) The certificate of merger with respect to the merger of MT
Acquisition Corp. and Mettler-Toledo, Inc. shall be filed with the
Secretary of State of the State of Delaware on or promptly after the
Closing Date.
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(c) Within a reasonable period of time after the Closing Date, the
Borrowers shall or shall cause to be delivered evidence of the completion
of all recordings and filings of, or with respect to, the Security
Documents and delivery of such other security and other documents as may
be necessary or, in the opinion of the Arranger, desirable to perfect the
Liens created, or purported or intended to be created, by the Security
Documents.
ARTICLE VIII.
NEGATIVE COVENANTS
So long as any Lender shall have any Commitment hereunder, or any
Loan or other Obligation shall remain unpaid or unsatisfied, or any Letter of
Credit shall remain outstanding:
8.1. Limitation on Liens. The Borrowers shall not, and will not
cause or permit any Subsidiary to, create, incur, assume or suffer to exist any
Lien upon or with respect to any property or assets of either Borrower or any
Subsidiary, whether now owned or hereafter acquired, or sell any such property
or assets subject to an understanding or agreement, contingent or otherwise, to
repurchase such property or assets or assign any right to receive income, or
file or permit the filing of any financing statement under the UCC or any other
similar effective notice of Lien under any similar recording or notice statute,
except Prior Liens and other Liens expressly permitted by the Security
Documents, and except the following, which are herein collectively referred to
as "Permitted Liens" (each of which shall be given independent effect):
(a) any Lien existing on property of either Borrower or any
Subsidiary (including any member of the Mettler-Toledo Group) on the
Closing Date and set forth in Schedule 8.1 covering only the property or
assets set forth in such Schedule 8.1 and securing Indebtedness
outstanding on such date (other than any Debt to Be Repaid);
(b) any Lien created under any Loan Document;
(c) to the extent complying with the provisions of the Security
Documents, Liens for taxes, fees, assessments or other governmental
charges which are not yet delinquent, or to the extent that non-payment
thereof is permitted by Section 7.6;
(d) to the extent complying with the provisions of the Security
Documents, Liens in respect of property or assets of US Borrower or any
Subsidiary imposed by law which were incurred in the ordinary course of
business and have not arisen to secure
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Indebtedness, such as landlords', carriers', warehousemen's, mechanics',
materialmen's, workmen's and repairmen's Liens, equipment leases and other
similar Liens arising in the ordinary course of business, and (x) which do
not in the aggregate materially detract from the value of such property or
assets or materially impair the use thereof in the operation of the
business of US Borrower and the Subsidiaries or (y) which are being
contested in good faith by appropriate proceedings, which proceedings have
the effect of preventing the forfeiture or sale of the property or asset
subject to such Lien;
(e) Liens (other than any Lien imposed by ERISA) consisting of
pledges or deposits required in the ordinary course of business in
connection with workers' compensation, unemployment insurance and other
social security or similar legislation;
(f) Liens on the property of US Borrower or any Subsidiary (other
than Collateral) securing (i) the non-delinquent performance of bids,
trade contracts (other than for borrowed money), leases or statutory
obligations, (ii) contingent obligations on surety or appeal bonds, and
(iii) other non-delinquent obligations of a like nature, in each case,
incurred in the ordinary course of business; provided, however, that all
such Liens individually or in the aggregate would not (even if enforced)
cause a Material Adverse Effect;
(g) Liens consisting of judgment or judicial attachment liens
(including prejudgment attachment), provided that the enforcement of such
Liens is effectively stayed or payment of which is covered in full
(subject to a customary deductible) by insurance or which do not otherwise
result in an Event of Default under subsection 9.1(i);
(h) easements, rights-of-way, servitudes, covenants, restrictive
covenants, encumbrances, minor defects or irregularities in title and
other similar restrictions which, individually or in the aggregate, do not
materially interfere with the ordinary conduct of the businesses of US
Borrower and the Subsidiaries and which do not materially impair for its
intended purpose the Mortgaged Real Property to which they relate;
(i) security interests (whether purchase money or otherwise) on any
property acquired, constructed or improved after the Closing Date by US
Borrower or any Subsidiary securing Indebtedness incurred or assumed for
the purpose of financing all or any part of the cost of acquiring,
constructing or improving such property; provided, however, that (i) any
such Lien attaches to such property concurrently with or within 180 days
after the acquisition thereof or the completion of construction or
improvement, (ii) such Lien attaches solely to the property so acquired,
constructed or improved in such transaction, (iii) the principal amount of
the Indebtedness secured thereby does not
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exceed 100% of the fair market value of such property at the time of
incurrence of such Indebtedness, plus the cost of construction or
improvement, and (iv) the principal amount of the Indebtedness secured by
any and all such security interests, plus the aggregate amount of all
Indebtedness arising under Capital Leases permitted solely by subsection
(j) below of this Section 8.1, shall not at any time exceed a Dollar
Equivalent amount of U.S. $10.0 million;
(j) Liens securing obligations in respect of Capital Leases on
assets subject to such leases; provided, however, that the aggregate
amount of all Indebtedness arising under Capital Leases permitted solely
by this subsection (j) (other than in respect of Capital Leases for
automobiles leased in the ordinary course of business that are not
required to be capitalized under International Accounting Standards), plus
the aggregate amount of all Indebtedness secured by security interests
permitted solely by subsection (i) above of this Section 8.1, shall not at
any time exceed a Dollar Equivalent amount of U.S. $10.0 million;
(k) Liens arising solely by virtue of any statutory or common law
provision relating to banker's liens, rights of set-off or similar rights
and remedies as to deposit accounts or other funds maintained with a
creditor depository institution; provided, however, that (i) such deposit
account is not a dedicated cash collateral account and is not subject to
restrictions against access by US Borrower or any Subsidiary in excess of
those set forth by regulations promulgated by the FRB, and (ii) such
deposit account is not intended by US Borrower or any Subsidiary to
provide collateral to the depository institution;
(l) Liens existing on any asset prior to the date of acquisition
thereof by US Borrower or any Subsidiary which (i) were not created in
contemplation of or in connection with such acquisition and (ii) do not
extend to or cover any other property or assets of US Borrower or any
Subsidiary;
(m) Liens existing on any asset of any Person at the time such
Person becomes a Subsidiary or is merged or consolidated with or into a
Subsidiary which (i) were not created in contemplation of or in connection
with such event and (ii) do not extend to or cover any other property or
assets of US Borrower or any Subsidiary;
(n) Liens (excluding Liens on Collateral) not otherwise permitted
hereunder securing obligations not at any time exceeding in the aggregate
a Dollar Equivalent amount of U.S. $5.0 million;
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(o) subject to the provisions of Section 8.20, Leases with respect
to the assets or properties of US Borrower or any Subsidiary, subordinate
in all respects to the Liens granted and evidenced by the Security
Documents;
(p) Liens evidenced by UCC financing statements regarding operating
and equipment leases permitted by this Agreement or in respect of
consigned goods;
(q) any encumbrance or restriction (including, without limitation,
any put and call agreements) with respect to the capital stock of any
Joint Venture or Subsidiary pursuant to the agreement governing such Joint
Venture or Subsidiary; provided, however, that no such encumbrance or
restriction affects in any way the ability of US Borrower or any
Subsidiary to comply with Section 8.22;
(r) any Lien arising out of the refinancing, extension, renewal or
refunding of any Indebtedness secured by any Lien permitted by any of
subsection 8.1(a), (i), (j), (l), (m), (n) or (v); provided, however, that
such Indebtedness is not increased, except as permitted under subsection
8.5(o) and is not secured by any additional assets as to which a Lien is
not otherwise permitted hereunder;
(s) Liens solely in favor of either Borrower or, if granted by any
Qualified Subsidiary Guarantor, any Subsidiary which is a Qualified
Subsidiary Guarantor or, if granted by any other Subsidiary, any
Subsidiary;
(t) Liens securing obligations under Swap Contracts with Lenders;
(u) Liens securing Guaranty Obligations of US Borrower or any
Subsidiary in respect of Indebtedness incurred pursuant to subsection
8.5(g); provided, however, that the creditor in respect of such
Indebtedness (or an agent on behalf of the creditors) shall have executed
and delivered an Intercreditor Agreement which is in full force and
effect; and
(v) Liens on cash in a deposit account securing Indebtedness
incurred under subsection 8.5(n) to the extent that such deposit account
is established in connection therewith, not to exceed an amount of cash
equal to such Indebtedness.
8.2. Consolidations, Mergers and Disposition of Assets. The
Borrowers shall not, and shall not cause or permit any Subsidiary to, directly
or indirectly, consummate any Asset Sale or wind up, liquidate or dissolve its
affairs or merge, amalgamate, consolidate with or into, or convey, transfer,
lease or otherwise dispose of (whether in one transaction or in a series of
transactions) all or substantially all of their respective properties or assets
(whether now
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owned or hereafter acquired) to or in favor of any Person, except (each of which
shall be given independent effect):
(a) dispositions of inventory and of used, worn-out or surplus
equipment, all in the ordinary course of business; provided, however, that
the proceeds thereof are reinvested in the business of US Borrower or the
Subsidiaries;
(b) the sale of equipment to the extent that such equipment is
exchanged for credit against the purchase price of similar replacement
equipment, or the proceeds of such sale are reasonably promptly applied to
the purchase price of similar replacement equipment;
(c) the Liens permitted by Section 8.1, the Investments permitted
pursuant to Section 8.4 and the Restricted Payments permitted by Section
8.13;
(d) US Borrower or any Subsidiary may sell assets; provided,
however, that (x) the aggregate sale proceeds from all such Assets Sales
shall not exceed the Dollar Equivalent amount of U.S. $2.0 million in any
fiscal year of US Borrower and (y) the Net Cash Proceeds therefrom are
either applied to prepay Term Loans as provided in subsection 2.7(c) or
reinvested as provided in subsection 2.7(c);
(e) US Borrower or any Subsidiary may sell or discount, in each case
without recourse, accounts receivables arising in the ordinary course of
business, but only in connection with the compromise or collection thereof
or as permitted by Section 8.21; provided, however, that any Foreign
Subsidiary may effect such sale or discount with recourse if such is
consistent with ordinary business terms in such Subsidiary's country of
business;
(f) US Borrower or any Subsidiary may, in the ordinary course of
business, license patents, trademarks, copyrights and know-how to third
Persons, so long as each such license is permitted to be assigned pursuant
to the Security Agreement and does not otherwise prohibit the granting of
a Lien therein by US Borrower or any Subsidiary pursuant to the Security
Agreement;
(g) any Subsidiary may be merged or consolidated with or into either
Borrower or any Wholly-Owned Subsidiary of US Borrower which is a
Qualified Subsidiary Guarantor and may transfer assets to either Borrower
or any Wholly-Owned Subsidiary of US Borrower which is a Qualified
Subsidiary Guarantor; provided, however, that (x) in any merger or
consolidation involving either Borrower, such Borrower (or CH Borrower if
between the Borrowers) shall be the surviving corporation
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(provided that upon CH Borrower being the survivor of any merger or
consolidation between the Borrowers, CH Borrower shall assume all
Obligations of US Borrower pursuant to documentation in form and substance
satisfactory to the Administrative Agent) and (y) if the surviving
corporation of such merger or consolidation or the transferee of such
assets is a Subsidiary, (i) all of the capital stock of such Subsidiary
(or, subject to Section 7.18, not less than 65% of the capital stock of
any Foreign Subsidiary) is pledged pursuant to a Securities Pledge
Agreement, (ii) such surviving Subsidiary is a Qualified Subsidiary
Guarantor, and (iii) the assets of such surviving Subsidiary are pledged
pursuant to an appropriate Security Document, except in each case to the
extent prohibited by law or such as would cause adverse tax consequences;
(h) the consummation of the M-T Acquisition in accordance with the
M-T Acquisition Documents;
(i) US Borrower or any Subsidiary may sell assets set forth on
Schedule 8.2(i); provided, however, that the Net Cash Proceeds therefrom
are either applied to prepay Term Loans as provided in subsection 2.7(c)
or reinvested as provided in subsection 2.7(c);
(j) US Borrower or any Subsidiary may sell surplus real property and
improvements thereon not utilized in the business of US Borrower or any
Subsidiary; provided, however, that the Net Cash Proceeds therefrom are
applied to prepay Term Loans as provided in subsection 2.7(c);
(k) US Borrower or any Subsidiary may sell a line of business if the
portion of the consolidated EBITDA of US Borrower and the Subsidiaries for
the latest twelve months immediately prior to such sale attributable to
such business, plus the trailing twelve month EBITDA of all other
businesses sold pursuant to this subsection 8.2(k) (measured at the time
of sale) does not exceed 5.0% of the consolidated EBITDA of US Borrower
and the Subsidiaries for the latest twelve months (before giving effect to
the current contemplated sale);
(l) any Acquisition permitted by Section 8.4;
(m) any Foreign Subsidiary which is not a Qualified Subsidiary
Guarantor may merge or consolidate with or into or sell, assign or
transfer its assets to any other Foreign Subsidiary which is not a
Qualified Subsidiary Guarantor, except that no Subsidiary which is a CH
Foreign Subsidiary may enter into any such transaction with a Subsidiary
that is not a CH Foreign Subsidiary unless the CH Foreign Subsidiary is
the surviving or transferee corporation; and
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(n) the abandonment or other disposition of patents, trademarks or
other intellectual property that is, in the reasonable judgment of US
Borrower, no longer economically practicable to maintain or useful in the
conduct of the business of US Borrower and the Subsidiaries, taken as a
whole.
To the extent the Required Lenders waive the provisions of this Section 8.2 with
respect to the sale or other disposition of any Collateral, or any Collateral is
sold or otherwise disposed of as permitted by this Section 8.2 (and such
Collateral is released (or permitted to be released) from the Liens created by
the respective Security Document), such Collateral in each case shall be sold or
otherwise disposed of free and clear of the Liens created by the Security
Documents and the Administrative Agent shall take such actions as are
appropriate in connection therewith.
8.3. Leases. The Borrowers shall not permit, and shall not cause or
permit any Subsidiary to permit, the aggregate lease payments calculated in
accordance with GAAP (including, without limitation, any property taxes paid as
additional rent or lease payments) by US Borrower and the Subsidiaries on a
consolidated basis under any agreement to rent or lease any real or personal
property (or any extension or renewal thereof) (excluding Capital Leases) to
exceed in any fiscal year (commencing with fiscal 1996) the Dollar Equivalent
amount of U.S. $17.50 million, increased each year after fiscal 1998 by the
Dollar Equivalent amount of U.S. $2.0 million.
8.4. Loans and Investments. The Borrowers shall not, and shall not
cause or permit any Subsidiary to, directly or indirectly, purchase or acquire,
or make any commitment to purchase or acquire, any capital stock, equity
interest, or obligations or other securities of, or any interest in, any Person,
or make or commit to make any Acquisition, or make or commit to make any
advance, loan, extension of credit or capital contribution to, or guarantee of
any obligation of, or any other investment in, or incur Guaranty Obligations on
behalf of, any Person (including any Affiliate of US Borrower) (any of the
foregoing, an "Investment"), except for (each of which shall be given
independent effect):
(a) Investments by US Borrower and the Subsidiaries in Cash and Cash
Equivalents;
(b) extensions of credit in the nature of accounts receivable or
notes receivable arising from the sale or lease of goods or services in
the ordinary course of business;
(c) Investments (including extensions of credit (such extensions of
credit, "Intercompany Indebtedness") and Guaranty Obligations) by US
Borrower or any Subsidiary in or to US Borrower, CH Borrower or any
Wholly-Owned Subsidiary of US Borrower which is a Qualified Subsidiary
Guarantor (or in any Person that thereby
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becomes a Wholly-Owned Subsidiary of US Borrower which is a Qualified
Subsidiary Guarantor); provided, however, that (x) with respect to any
Guaranty Obligation issued by any Subsidiary of either Borrower's
obligations, such Subsidiary has entered into a Subsidiary Guarantee at
least as favorable as such Guaranty Obligation, (y) upon request of the
Required Lenders, all such Intercompany Indebtedness shall be evidenced by
subordinated promissory notes in form, and shall be pledged to the
Administrative Agent pursuant to documentation, reasonably satisfactory to
the Required Lenders and (z) such Subsidiary shall have entered into the
appropriate Security Documents pursuant to Section 7.14 and taken all
necessary action pursuant to Section 7.15;
(d) Investments consisting of non-cash consideration received in the
form of securities, notes or similar obligations in connection with
disposition of assets permitted by subsection 8.2(d), (i), (j) or (k);
provided, however, that (i) the aggregate amount of such non-cash
consideration received in connection with any such disposition shall not
exceed 25% with respect to subsections 8.2(d), (i) and (j) and 15% with
respect to subsection 8.2(k) of the total consideration received in
connection with such disposition and (ii) such non-cash consideration is
pledged pursuant to the appropriate Security Document;
(e) Investments in Joint Ventures or non-Wholly-Owned Subsidiaries
(other than any Investment made to consummate any Acquisition); provided,
however, that the aggregate amount of any such Investment, plus the
aggregate value of all such Investments (excluding Investments which
constitute part of the M-T Acquisition) made by US Borrower or any
Subsidiary after the Closing Date and (without duplication) the aggregate
amount of all Guaranty Obligations permitted solely by subsection 8.8(f)
paid after the date hereof or outstanding as of the date of such
Investment, shall not exceed a Dollar Equivalent amount of U.S. $25.0
million (exclusive of any Investment pursuant to subsection 8.4(f));
provided, however, that any such Investment shall comply with Section 8.6;
(f) Investments made in order to consummate Acquisitions (other than
the M-T Acquisition); provided, however, that (i) no Event of Default or
Unmatured Event of Default exists or will result therefrom (including any
such event under Section 8.15), (ii) on a pro forma basis, after giving
effect to such Acquisition(s), US Borrower would have been in compliance
with Sections 8.10, 8.11 and 8.12 on the last day of the most recently
completed fiscal quarter (assuming, for purposes of Sections 8.10 and, if
applicable, 8.12, that such Acquisition had occurred on the first day of
the Computation Period ending on such last day) which compliance shall,
for any Acquisition involving consideration of the Dollar Equivalent
amount of U.S. $10.0 million, be demonstrated in an Officers' Certificate
delivered to the Administrative Agent and each Lender and
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(iii) the aggregate Dollar Equivalent amount of the consideration (which
for each Acquisition shall be measured at the date of consummation thereof
and which shall include debt assumed, earn outs, working capital deficits
and deferred payments) paid for all Acquisitions (other than the M-T
Acquisition) consummated since the Closing Date shall not exceed the
Dollar Equivalent amount of U.S. $30.0 million;
(g) pledges or deposits required in the ordinary course of business
in connection with workmen's compensation, unemployment insurance and
other social security or similar legislation;
(h) pledges or deposits in connection with (i) the non-delinquent
performance of bids, trade contracts (other than for borrowed money),
leases or statutory obligations, (ii) contingent obligations on surety or
appeal bonds (including those permitted by subsection 8.8(d)), and (iii)
other non-delinquent obligations of a like nature, in each case incurred
in the ordinary course of business;
(i) advances, loans or extensions of credit to suppliers in the
ordinary course of business by US Borrower or any Subsidiary consistent
with past practice as of the Closing Date;
(j) advances, loans or extensions of credit by US Borrower or any
Subsidiary to employees of US Borrower or any Subsidiary; provided,
however, that the aggregate amount of all such loans, advances and
extensions of credit, other than those entered into in connection with the
consummation of the M-T Acquisition and set forth on Schedule 8.4(j) and
other than advances for travel and entertainment expenses in the ordinary
course of business, shall not at any time exceed in the aggregate a Dollar
Equivalent amount of U.S. $5.0 million;
(k) other advances, loans or extensions of credit (excluding
advances, loans or extensions of credit of the types described in
subsection 8.4(j)) in the ordinary course of business by US Borrower or
any Subsidiary not at any time exceeding in the aggregate a Dollar
Equivalent amount of U.S. $2.50 million;
(l) Investments to consummate the M-T Acquisition on the terms set
forth in the M-T Acquisition Documents;
(m) Investments (including debt obligations) received in connection
with the bankruptcy or reorganization of suppliers and customers and in
settlement of delinquent obligations of, and other disputes with,
customers and suppliers arising in the ordinary
<PAGE>
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course of business; provided, however, that any securities or other
property so received is pledged pursuant to the appropriate Security
Document;
(n) Swap Contracts entered into in compliance with subsection
8.8(b);
(o) Investments in existence on the Closing Date and listed in
Schedule 8.4(o), without giving effect to any additions thereto and
Investments to be made pursuant to binding agreements in existence on the
Closing Date set forth on Schedule 8.4(o) to the extent made in accordance
with the terms of such agreements as in effect on the Closing Date;
(p) Investments (including Intercompany Indebtedness and Guaranty
Obligations) by US Borrower or any Subsidiary in any Subsidiary which is
not a Qualified Subsidiary Guarantor or which is not a Wholly-Owned
Subsidiary of US Borrower and not otherwise permitted by subsections (e),
(q), (v) and (w) of this Section 8.4, not to exceed an aggregate amount
outstanding at any time (net of returns, dividends in cash, net cash
proceeds on sale or other cash realizations thereof) of the Dollar
Equivalent amount of U.S. $10.0 million; provided, however, that upon
request of the Required Lenders, all such Intercompany Indebtedness shall
be evidenced by subordinated promissory notes in form, and shall be
pledged to the Administrative Agent pursuant to documentation, reasonably
satisfactory to the Required Lenders;
(q) US Borrower and the Subsidiaries may hold additional Investments
in any Subsidiary which is not a Qualified Subsidiary Guarantor or a
Wholly Owned Subsidiary to the extent that such Investments reflect an
increase in the value of such Subsidiary resulting from retained earnings
of such Subsidiary;
(r) any Subsidiary which is not a Qualified Subsidiary Guarantor may
make Investments in or to any other Subsidiary which is not a Qualified
Subsidiary Guarantor (other than by a CH Foreign Subsidiary to a non-CH
Foreign Subsidiary);
(s) Investment made in connection with the Ciba Loan; provided,
however, that (x) the Administrative Agent shall have received evidence
reasonably satisfactory to it from Swiss tax authorities that the Swiss
tax authorities will refund the Swiss withholding tax payments for which
substantially all of such loan is the interim source pending such
repayment and (y) the Ciba Loan Documents are pledged pursuant to the
Security Documents;
(t) without duplication, Capital Expenditures permitted by Section
8.19 and the Contingent Obligations permitted by subsections 8.8(d), (g)
and (i);
<PAGE>
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(u) US Borrower or any Subsidiary may make Investments (including
Intercompany Indebtedness and Guaranty Obligations) in any Subsidiary
Guarantor which is not a Qualified Subsidiary Guarantor in an amount not
to exceed the Dollar Equivalent amount of the Obligations guaranteed by
such Subsidiary Guarantor; provided, however, that upon request of the
Required Lenders, all such Intercompany Indebtedness shall be evidenced by
subordinated promissory notes in form, and shall be pledged to the
Administrative Agent pursuant to documentation, reasonably satisfactory to
the Required Lenders;
(v) Investments by US Borrower or any Subsidiary in any Wholly Owned
Subsidiary which is not a Qualified Subsidiary Guarantor to the extent
that contemporaneously with such Investment such entity in which the
Investment is being made issues an unsubordinated note to US Borrower or a
Qualified Subsidiary Guarantor in a Dollar Equivalent amount equal to the
Dollar Equivalent amount of the value of such Investment at such time;
provided, however, that (i) such note is fully secured by all assets of
the entity in which the Investment is being made to the extent permitted
by applicable law; (ii) such note is pledged to the Administrative Agent
on behalf of the Lenders pursuant to the Security Documents; and (iii)
such security interests securing such note, if any, are collaterally
assigned to the Administrative Agent on behalf of the Lenders; and
(w) Investments (including Intercompany Indebtedness and Guaranty
Obligations) by either Borrower or any Subsidiary in any Wholly-Owned
Subsidiary to the extent made in the ordinary course to fund or support
the ordinary course operations of such Wholly-Owned Subsidiary; provided,
however, that upon the request of the Required Lenders all such
Intercompany Indebtedness shall be evidenced by promissory notes in form,
and shall be pledged to the Administrative Agent pursuant to
documentation, reasonably satisfactory to the Required Lenders.
8.5. Limitation on Indebtedness. The Borrowers shall not, and shall
not cause or permit any Subsidiary to, directly or indirectly, create, incur,
assume, suffer to exist, or otherwise become or remain directly or indirectly
liable with respect to, any Indebtedness, except (each of which shall be given
independent effect):
(a) the Obligations;
(b) Indebtedness consisting of Contingent Obligations permitted
pursuant to Section 8.8;
<PAGE>
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(c) Indebtedness existing on the Closing Date which is Debt to Be
Repaid (which Indebtedness may not be outstanding beyond the Closing Date)
or is set forth in Schedule 6.17;
(d) Indebtedness incurred in connection with Capital Leases to the
extent permitted by subsection 8.1(j) and Indebtedness incurred in
connection with the acquisition, construction or improvement of property
to the extent permitted by subsection 8.1(i);
(e) Indebtedness of any Subsidiary to US Borrower or CH Borrower
and, to the extent the credit extension creating such Indebtedness is
permitted by subsection 8.4(c), (e), (l), (p), (r), (u), (v) or (w), of
any Subsidiary to any other Subsidiary;
(f) Indebtedness of US Borrower under the Senior Subordinated Notes
in an aggregate principal amount not to exceed U.S. $135.0 million, less
any prepayments or repayments thereof and any guarantee thereof by any
Domestic Subsidiary in accordance with the terms of the Senior
Subordinated Note Documents as in effect on the Closing Date;
(g) Indebtedness of Foreign Subsidiaries in an aggregate principal
amount not to exceed in the aggregate at any time outstanding for all
Foreign Subsidiaries (exclusive of any amount incurred pursuant to
subsection 8.5(n) below) the Dollar Equivalent amount of U.S. $30.0
million; provided, however, that not more than the Dollar Equivalent
amount of U.S. $15.0 million in the aggregate may be incurred and
outstanding at any time pursuant to any agreement that is for permanent
funded debt or pursuant to agreements which individually do not provide
for annual clean down provisions (i.e., reducing outstanding Indebtedness
to zero) for not less than 30 days per year;
(h) unsecured Indebtedness not to exceed in the aggregate at any
time outstanding the Dollar Equivalent amount of U.S. $10.0 million;
(i) Indebtedness arising from honoring a check, draft or similar
instrument against insufficient funds; provided, however, that such
Indebtedness is extinguished within five Business Days of its incurrence;
(j) obligations under operating leases permitted by Section 8.3 or
Section 8.20;
(k) [Intentionally Omitted];
<PAGE>
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(l) Indebtedness of a Person existing at the time such Person became
a Subsidiary or assets were acquired from such Person, to the extent such
Indebtedness was not incurred in connection with, or in contemplation of,
such Person becoming a Subsidiary or the acquisition of such assets, not
to exceed in the aggregate at any time outstanding the Dollar Equivalent
amount of U.S. $10.0 million;
(m) unsecured Indebtedness incurred by US Borrower to former
employees in connection with the purchase or redemption of stock of US
Borrower, Holding or MT Investors not to exceed in aggregate amount
outstanding the Dollar Equivalent amount of U.S. $2.50 million;
(n) Indebtedness of the Chinese Subsidiaries pursuant to local
working capital facilities and other Indebtedness not to exceed in the
aggregate at any time outstanding for all Chinese Subsidiaries the Dollar
Equivalent amount of U.S. $15.0 million; and
(o) any renewals, extensions, substitutions, refinancings or
replacements (each, for purposes of this subsection (o), a "refinancing")
of any Indebtedness permitted by this Section 8.05, including any
successive refinancings, so long as any such refinancing Indebtedness
shall (w) not be on financial and other terms, in the reasonable judgment
of the Borrowers, that are more onerous than the Indebtedness being
refinanced, (x) not have a stated maturity or Average Life that is shorter
than the Indebtedness being refinanced, (y) be at least as subordinate to
the Obligations as the Indebtedness being refinanced (and unsecured if the
refinanced Indebtedness is unsecured) and (z) be in principal amount that
does not exceed the principal amount so refinanced, plus the lesser of (I)
the stated amount of any premium or other payment required to be paid in
connection with such refinancing pursuant to the terms of the Indebtedness
being refinanced and (II) the amount of premium or other payment actually
paid at such time to refinance the Indebtedness, plus, in either case, the
amount of reasonable expenses of the Borrowers or any Subsidiary incurred
in connection with such refinancing.
If such Indebtedness is incurred to refinance Indebtedness
denominated in a currency other than U.S. Dollars and such refinancing would
cause a Dollar Equivalent restriction to be exceeded if calculated at the
relevant currency exchange rate in effect on the date of such refinancing, such
Dollar Equivalent restriction shall not be deemed to have been exceeded so long
as the principal amount of such refinancing Indebtedness does not exceed the
principal amount of such Indebtedness being refinanced, but the ability to make
subsequent incurrences of Indebtedness subject to the applicable Dollar
Equivalent restriction shall be determined as if the relevant currency exchange
rate applied to any such previous refinancing was the rate in effect on the date
of such refinancing.
<PAGE>
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8.6. Transactions with Affiliates. The Borrowers shall not, and
shall not cause or permit any Subsidiary to, directly or indirectly, enter into
any transaction with any Affiliate of US Borrower (other than a Borrower or a
Subsidiary if no portion of such Subsidiary is owned (other than through US
Borrower or the Subsidiaries) by Persons who control (directly or indirectly)
Holding), except upon fair and reasonable terms no less favorable to such
Borrower or such Subsidiary than would obtain in a comparable arm's-length
transaction with a Person not an Affiliate of US Borrower or such Subsidiary;
provided, however, that the following shall in any event be permitted: (a) the
payment on the Closing Date of one time fees to AEA in an aggregate amount not
to exceed U.S. $5.50 million (plus reasonable out-of-pocket expenses incurred by
AEA in providing services to US Borrower, including monies advanced for the
purchase of currency options and contracts entered into in connection with
consummation of the M-T Acquisition); (b) the payment, on a quarterly basis, of
management fees to AEA pursuant to the Management Services Agreement in an
aggregate amount (for all such Persons taken together) not to exceed U.S.
$250,000 in any fiscal quarter of US Borrower; provided, however, that no Event
of Default or Unmatured Event of Default pursuant to Section 9.1(a) then exists
or would result therefrom; (c) the reimbursement of AEA for its reasonable
out-of-pocket expenses incurred by it in connection with performing management
services to US Borrower and the Subsidiaries pursuant to the Management Services
Agreement; (d) Restricted Payments permitted by subsections 8.13(c), (e), (f)
and (h); (e) US Borrower and the Domestic Subsidiaries may enter into the Tax
Sharing Agreement and may make payments thereunder; (f) the payment of
reasonable and customary regular fees to directors of US Borrower or any
Subsidiary who are not employees of US Borrower or any Subsidiary; (g) any
transaction with an officer or member of the board of directors of US Borrower
or any Subsidiary in the ordinary course of business involving compensation,
indemnity or employee benefit arrangements; (h) loans or advances to employees
permitted by subsection 8.4(j); (i) the M-T Acquisition and all transactions
related thereto (including but not limited to the financing thereof) to the
extent consummated in accordance with the M-T Acquisition Documents; (j) any
transaction in the ordinary course of business or approved by a majority of the
Disinterested Directors, between US Borrower or any Subsidiary and any Affiliate
of US Borrower controlled by US Borrower that is a Joint Venture or similar
entity primarily engaged in a Related Business; provided, however, that no
person or entity which has an economic interest in MT Investors or Holding has
an interest in such Joint Venture other than through US Borrower or any
Subsidiary; and (k) US Borrower and the Subsidiaries may enter into and perform
its obligations under the Ciba Reimbursement Agreement and the Ciba Loan
Documents.
8.7. Use of Proceeds. (a) The Borrowers and the Subsidiary Swing
Line Borrowers shall not, and the Borrowers shall not cause or permit any
Subsidiary to, directly or indirectly, use any portion of the Loan proceeds or
any Letter of Credit, directly or indirectly, (i) to purchase or carry Margin
Stock, (ii) to repay or otherwise refinance Indebtedness of any
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Loan Party or others incurred to purchase or carry Margin Stock or (iii) to
extend credit for the purpose of purchasing or carrying any Margin Stock.
(b) The Borrowers and the Subsidiary Swing Line Borrowers shall not,
directly or indirectly, use any portion of the Loan proceeds or any Letter of
Credit (i) knowingly to purchase Ineligible Securities from the Arranger during
any period in which the Arranger makes a market in such Ineligible Securities,
(ii) knowingly to purchase during the underwriting or placement period
Ineligible Securities being underwritten or privately placed by the Arranger, or
(iii) to make payments of principal or interest on Ineligible Securities
underwritten or privately placed by the Arranger and issued by or for the
benefit of a Borrower or any Affiliate of a Borrower. The Arranger is a
registered broker-dealer and permitted to underwrite and deal in certain
Ineligible Securities; and "Ineligible Securities" means securities which may
not be underwritten or dealt in by member banks of the Federal Reserve System
under Section 16 of the Banking Act of 1933 (12 U.S.C. ss. 24, Seventh), as
amended.
8.8. Contingent Obligations. The Borrowers shall not, and shall not
cause or permit any Subsidiary to, directly or indirectly, create, incur, assume
or suffer to exist any Contingent Obligations, except:
(a) endorsements for collection or deposit in the ordinary course of
business;
(b) Swap Contracts entered into in the ordinary course of business
and designed to protect against fluctuations in interest rates, currency
exchange rates, commodity prices or similar risks (including any Swap
Contract entered into pursuant to Section 7.16 or Section 7.17);
(c) Contingent Obligations of US Borrower and the Subsidiaries
existing as of the Closing Date and listed in Schedule 8.8;
(d) Contingent Obligations arising under (i) Surety Instruments
arising in the ordinary course of business of US Borrower or any
Subsidiary or (ii) any guaranty of the performance of contractual
obligations (other than obligations to pay money) of other Persons that
are not Subsidiaries so long as such guaranty arises in connection with a
project in which a Borrower or the applicable Subsidiary is otherwise
involved in the ordinary course of business, not to exceed in the
aggregate for all Contingent Obligations pursuant to this subclause (d)
the Dollar Equivalent amount of U.S. $25.0 million;
(e) Guaranty Obligations permitted by subsections 8.4(c), (i), (j),
(k), (p), (r), (u) and (w);
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(f) Guaranty Obligations in respect of the Indebtedness or other
liabilities of Joint Ventures or Persons in which a Borrower or any
Subsidiary has a minority interest or in non-Wholly-Owned Subsidiaries of
US Borrower; provided, however, that the aggregate amount of all such
Guaranty Obligations at any time outstanding, plus the aggregate amount of
all Guaranty Obligations permitted solely by this subsection (f) which are
paid after the date hereof and (without duplication) the aggregate amount
of all Investments (excluding Investments which constitute part of the M-T
Acquisition) made after the date hereof which are permitted solely by
subsection 8.4(e), shall not exceed in the aggregate a Dollar Equivalent
amount of U.S. $25.0 million;
(g) other Contingent Obligations not at any time exceeding in the
aggregate outstanding a Dollar Equivalent amount of U.S. $5.0 million;
(h) the Guarantees and reimbursement obligations arising under the
Loan Documents in respect of drawings under Letters of Credit;
(i) Guaranty Obligations by Domestic Subsidiaries of US Borrower in
respect of US Borrower's obligations under the Senior Subordinated Notes
pursuant to the Senior Subordinated Note Documents as in effect on the
Closing Date;
(j) the Ciba Reimbursement Agreement;
(k) Guaranty Obligations of Foreign Subsidiaries under letters of
credit; and
(l) Guaranty Obligations by US Borrower or any Subsidiary of
Indebtedness of Foreign Subsidiaries permitted by subsection 8.5(g) or
(n); and
(m) Guaranty Obligations in connection with sales and other
dispositions of assets permitted under Section 8.2, arising in connection
with indemnification and other agreements in respect of any contract
relating to such sale, not to exceed the consideration received by US
Borrower or any Subsidiary in connection with such sale and excluding in
all cases any Guaranty Obligation with respect to any obligation of any
third person incurred in connection with the acquisition of such assets.
8.9. Restrictions on Subsidiaries. The Borrowers shall not cause or
permit any Subsidiary to, directly or indirectly, enter into any agreement or
instrument (other than (i) the Senior Subordinated Note Documents as in effect
on the Closing Date, (ii) the Loan Documents and (iii) any agreement or
instrument relating to Indebtedness permitted by subsection 8.5(c), provided
that such restriction relates solely to such Foreign Subsidiary) which by its
terms restricts the ability of such Subsidiary (a) to declare or pay dividends
or make similar
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distributions, (b) to repay principal of, or pay any interest on, any
indebtedness owed to a Borrower or any other Subsidiary, (c) to make payments of
royalties, licensing fees and similar amounts to a Borrower or any other
Subsidiary or (d) to make loans or advances to, or guarantee any Indebtedness or
other obligation of, a Borrower or any other Subsidiary, except for such
encumbrances or restrictions existing under or by reason of (i) customary
provisions restricting subletting or assignment of any lease governing a
leasehold interest of US Borrower or a Subsidiary, (ii) customary provisions
restricting assignment of any agreement or license entered into by US Borrower
or any Subsidiary in the ordinary course of business, (iii) customary provisions
restricting the transfer of assets subject to Liens permitted under subsections
8.1(a), (i), (j), (l), (m), (n) and (q) and (iv) applicable law (including
minimum capital requirements).
8.10. Fixed Charge Coverage Ratio. The Borrowers shall not permit,
as of the last day of any fiscal quarter (beginning with the fiscal quarter
ending December 31, 1996) ending during any period set forth below, the ratio of
(a) EBITDA less Capital Expenditures for the Computation Period ending on such
day, to (b) (x) prior to the first such time as four fiscal quarters of
financial information of US Borrower after the Closing Date shall have been
provided pursuant to this Agreement, Annualized Interest Expense at the end of
such fiscal quarter and (y) thereafter, Interest Expense of US Borrower and the
Subsidiaries for such Computation Period, to be less than the ratio set forth
opposite such period in the table below:
================================================================================
Period Ratio
- --------------------------------------------------------------------------------
Closing Date through 9/30/1997 1.20:1.0
- --------------------------------------------------------------------------------
10/1/1997 through 9/30/1998 1.30:1.0
- --------------------------------------------------------------------------------
10/1/1998 through 9/30/1999 1.50:1.0
- --------------------------------------------------------------------------------
10/1/1999 through 9/30/2000 1.75:1.0
- --------------------------------------------------------------------------------
10/1/2000 through 9/30/2001 2.00:1.0
- --------------------------------------------------------------------------------
10/1/2001 through 9/30/2002 2.25:1.0
- --------------------------------------------------------------------------------
10/1/2002 through 9/30/2003 2.50:1.0
- --------------------------------------------------------------------------------
10/1/2003 and thereafter 3.00:1.0
================================================================================
8.11. Minimum Net Worth. The Borrowers shall not permit Consolidated
Net Worth (to be calculated for the purposes of this Section 8.11 without giving
effect to cumulative depreciation and amortization of intangibles and excluding
net gains (but not losses) resulting from asset sales) at the end of any fiscal
quarter (beginning with the fiscal quarter ended
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December 31, 1996) occurring during any period set forth below to be less than
the amount set forth opposite such period:
================================================================================
Consolidated
Period Net Worth
- --------------------------------------------------------------------------------
Closing Date through 9/30/1998 U.S.$40.0 million
- --------------------------------------------------------------------------------
10/1/1998 through 9/30/1999 U.S.$50 million
- --------------------------------------------------------------------------------
10/1/1999 through 9/30/2000 U.S.$65 million
- --------------------------------------------------------------------------------
10/1/2000 through 9/30/2001 U.S.$80 million
- --------------------------------------------------------------------------------
10/1/2001 through 9/30/2002 U.S.$110 million
- --------------------------------------------------------------------------------
10/1/2002 through 9/30/2003 U.S.$135 million
- --------------------------------------------------------------------------------
10/1/2003 through 9/30/2004 U.S.$155 million
- --------------------------------------------------------------------------------
10/1/2004 and thereafter U.S.$175 million
================================================================================
To the extent that the final adjustments to stockholders' equity
(which shall be finalized not later than such time as necessary to be reflected
in the March 31, 1997 financial statements delivered hereunder) relating to the
write-down of research and development expense and inventory (of the nature
reflected in the pro forma financial statements in the prospectus filed with the
SEC relating to the Senior Subordinated Notes) is greater than or less than
U.S.$141.5 million (adjusted to give effect to the effect of applicable taxes to
the extent relating to inventory), the amount of such excess or deficit (as the
case may be) shall be added to or subtracted from (as the case may be) each
amount set forth in the table above for each fiscal year.
8.12. Debt to EBITDA Ratio. The Borrowers shall not permit, as of
the last day of any fiscal quarter (beginning with the fiscal quarter ending
March 31, 1997) ending during any period set forth below, the Debt to EBITDA
Ratio to exceed the ratio set forth opposite such period in the table below:
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================================================================================
Period Ratio
- --------------------------------------------------------------------------------
Closing Date through 9/30/1997 6.25:1.0
- --------------------------------------------------------------------------------
10/1/1997 through 3/31/1998 5.75:1.0
- --------------------------------------------------------------------------------
4/1/1998 through 12/30/1998 5.50:1.0
- --------------------------------------------------------------------------------
12/31/1998 through 3/31/1999 5.25:1.0
- --------------------------------------------------------------------------------
4/1/1999 through 9/30/1999 5.00:1.0
- --------------------------------------------------------------------------------
10/1/1999 through 9/30/2000 4.50:1.0
- --------------------------------------------------------------------------------
10/1/2000 through 9/30/2001 4.00:1.0
- --------------------------------------------------------------------------------
10/1/2001 through 9/30/2002 3.50:1.0
- --------------------------------------------------------------------------------
10/1/2002 and thereafter 3.00:1.0
================================================================================
8.13. Restricted Payments. Neither Borrower shall (i) declare or
make any dividend payment or other distribution of assets, properties, cash,
rights, obligations or securities on account of any shares of any class of the
capital stock of US Borrower or any Subsidiary (other than to US Borrower or any
Subsidiary) or (ii) purchase, redeem or otherwise acquire for value, or permit
any Subsidiary to purchase or otherwise acquire for value, any shares of US
Borrower's or any Subsidiary's capital stock or any warrants, rights or options
to acquire such shares, now or hereafter outstanding owned by any Person other
than US Borrower or any Wholly-Owned Subsidiary of US Borrower (any such
prohibited transaction, a "Restricted Payment"), except that (each of which
shall be given independent effect):
(a) US Borrower or any Subsidiary may declare and make dividend
payments or other distributions payable solely in its common stock;
(b) US Borrower or any Subsidiary may purchase, redeem, defease or
otherwise acquire or retire for value shares of its common stock or
warrants or options to acquire any such shares with shares of its common
stock;
(c) any Subsidiary may pay dividends and distributions or purchase,
redeem, defease or otherwise acquire or retire for value shares of its
common stock or warrants or options to acquire any such shares so long as
any such payments pursuant thereto by any non-Wholly-Owned Subsidiary of
US Borrower are made on a pro rata basis to such Subsidiary's shareholders
generally or are paid solely to a Loan Party;
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(d) US Borrower may pay cash loans, advances, dividends or
distributions to Holding to permit Holding or MT Investors to purchase
capital stock (or options or other rights in respect thereof) of Holding
or MT Investors held by former employees of Holding or any of its
Subsidiaries following termination of their employment or pursuant to
repurchase provisions under employee stock option agreements or employee
stock purchase agreements; provided, however, that (i) no Event of Default
or Unmatured Event of Default shall then exist or would arise therefrom
and (ii) the aggregate amount of such dividends shall not exceed U.S. $2.0
million in any fiscal year and U.S. $5.0 million in the aggregate since
the Closing Date;
(e) US Borrower may pay cash dividends to Holding to enable Holding
or MT Investors to pay operating expenses (including fees and
indemnification payments to directors and officers) in the ordinary course
of business; provided, however, that (i) no Event of Default or Unmatured
Event of Default under subsection 9.1(a) shall then exist or would arise
therefrom and (ii) the aggregate amount of such dividends shall not exceed
U.S. $1.0 million in any fiscal year;
(f) US Borrower may pay dividends to Holding in connection with the
payment of items specified in clauses (b) and (c) of the proviso to
Section 8.6; and
(g) US Borrower may make any payments to Holding or any parent
company of Holding to enable Holding or any parent company of Holding, as
applicable, to make payments, to holders of the common stock of US
Borrower, Holding or any parent company of Holding, as applicable, in lieu
of issuance of fractional shares of such common stock, in connection with
any recapitalization of US Borrower, Holding or any parent company of
Holding, as applicable, such payments not to exceed U.S. $100,000 in the
aggregate.
8.14. ERISA. The Loan Parties shall not, and shall not permit any of
their ERISA Affiliates to, engage in a transaction that could be subject to
Section 4069 or 4212(c) of ERISA.
8.15. Change in Business. (a) The Borrowers shall not, and shall not
cause or permit any Subsidiary to, directly or indirectly, engage in any
material line of business substantially different from those lines of business
carried on by US Borrower and the Subsidiaries (including the Mettler-Toledo
Group) on the Closing Date.
(b) Holding will engage in no business other than its ownership of
the capital stock of US Borrower and having those liabilities which it is
responsible for under the Basic Documents to which it is a party.
Notwithstanding the foregoing, Holding may engage in those
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activities that are incidental to (a) the maintenance of its corporate existence
in compliance with applicable law, (b) legal, tax and accounting matters in
connection with any of the foregoing activities and (c) the entering into, and
performing its obligations under, the Basic Documents to which it is a party.
8.16. Accounting Changes. The Borrowers shall not, and shall not
cause or permit any Subsidiary to, make any significant change in accounting
principles or reporting practices, except as required by GAAP, or change their
fiscal years.
8.17. Prepayments of Senior Subordinated Notes, etc. Holding and the
Borrowers shall not, and shall not cause or permit any Subsidiary to: (a) make
(or give any notice in respect of) any voluntary or optional payment or
prepayment or redemption or acquisition for value of the Senior Subordinated
Notes (including, without limitation, by way of depositing with any trustee with
respect thereto money or securities before such Indebtedness is due for the
purpose of paying such Indebtedness when due) or exchange of any such
Indebtedness, except that a refinancing thereof may be effected in accordance
with subsection 8.5(o); (b) amend, modify or change its certificate of
incorporation (including, without limitation, by the filing of any certificate
of designation) or its by-laws or any other organizational document or the
foreign equivalent thereof with respect to Foreign Subsidiaries (other than such
changes with respect to Subsidiaries (other than CH Borrower) as are necessary
to effect changes in organizational structure (whether under applicable
corporate law or for tax purposes) from corporate to partnership form in
connection with the M-T Acquisition), or any agreement entered into by it with
respect to its capital stock, or enter into any new agreement with respect to
its capital stock in any manner which would be materially adverse to the
Lenders; or (c) issue any capital stock other than non-redeemable common stock.
8.18. Amendments to Other Documents. Holding and the Borrowers shall
not and shall not cause or permit any Subsidiary to, directly or indirectly,
make any amendment, supplement or other modification of, or enter into any
consent or waiver with respect to, the subordination provisions of the Senior
Subordinated Note Documents or make any material amendment, supplement or other
modification of, or enter into any consent or waiver with respect to, any
Transaction Document or Other Document.
8.19. Capital Expenditures. The Borrowers shall not permit the
aggregate amount of all Capital Expenditures made by US Borrower and the
Subsidiaries for any fiscal year to exceed a Dollar Equivalent amount set forth
in the table below:
<PAGE>
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================================================================================
Fiscal Year U.S. Dollars
- --------------------------------------------------------------------------------
1996 30 million
- --------------------------------------------------------------------------------
1997 35 million
- --------------------------------------------------------------------------------
1998 35 million
- --------------------------------------------------------------------------------
1999 40 million
- --------------------------------------------------------------------------------
2000 40 million
- --------------------------------------------------------------------------------
2001 45 million
- --------------------------------------------------------------------------------
2002 45 million
- --------------------------------------------------------------------------------
2003 and thereafter 50 million
================================================================================
; provided, however, that the unused permitted amount of such Capital
Expenditures in any fiscal year may be carried over and used in the following
fiscal year if and to the extent that such carryover amount would not result in
the amount expended in any fiscal year exceeding 125% of the amount set forth in
the above table for such year (it being understood that in any fiscal year the
base permitted amount shall be counted first towards total expenditures);
provided, further, however, that the limitation set forth above shall not
include (1) Capital Expenditures made with (i) the proceeds of additional
capital contributions by Holding or the proceeds of additional equity issuances
and (ii) Net Cash Proceeds of Asset Sales to the extent reinvested in the
business as permitted hereby, (2) Capital Expenditures related to integration
costs that arise out of the M-T Acquisition in an amount not exceeding a Dollar
Equivalent amount of U.S. $5.0 million at any time prior to December 31, 1997
and (3) Capital Leases with respect to automobiles leased in the ordinary course
of business that are not required to be capitalized under International
Accounting Standards.
8.20. Sale and Lease-Backs. The Borrowers shall not, and shall not
cause or permit any Subsidiary to, directly or indirectly, become or thereafter
remain liable as lessee or as guarantor or other surety with respect to the
lessee's obligations under any lease, whether an operating lease or a Capital
Lease, of any property (whether real or personal or mixed), whether now owned or
hereafter acquired, (i) which US Borrower or any Subsidiary has sold or
transferred or is to sell or transfer to any other Person (other than US
Borrower or any Wholly-Owned Subsidiary which is a Qualified Subsidiary
Guarantor) or (ii) which US Borrower or any Subsidiary intends to use for
substantially the same purpose as any other property which has been or is to be
sold or transferred by Borrower or any Subsidiary to any Person in connection
with such lease, if in the case of clause (i) or (ii) above, such sale and such
lease are part of the same transaction or a series of related transactions or
such sale and such lease occur within one
<PAGE>
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year of each other or are with the same other Person, except for any transaction
permitted by subsection 8.2(d).
8.21. Sale or Discount of Receivables. Each Borrower shall not, nor
shall it cause or permit any Subsidiary to, directly or indirectly, sell, with
or without recourse, or discount (other than in connection with trade discounts
or arrangements necessitated by the creditworthiness of the other party, in each
case in the ordinary course of business consistent with past practice) or
otherwise sell for less than the face value thereof, notes or accounts
receivable, except (i) to US Borrower or any Wholly-Owned Subsidiary which is a
Qualified Subsidiary Guarantor, (ii) by Foreign Subsidiaries in the ordinary
course and consistent with past practice as of the Closing Date and the
customary practices of the applicable country and (iii) by Mettler-Toledo
(Albstadt) GmbH, Albstadt and Mettler-Toledo AG, Greifensee in connection with
the transfer of distribution rights relating to the business in Japan, not to
exceed the Dollar Equivalent amount of U.S. $4.0 million.
8.22 Creation of Subsidiaries. The Borrowers shall not, and shall
not cause or permit any Subsidiary to, establish, create or acquire after the
Closing Date any Subsidiary; provided, however, that, US Borrower and its
Wholly-Owned Subsidiaries shall be permitted to establish or create Wholly-Owned
Subsidiaries or any non-Wholly-Owned Subsidiary in connection with any
Investment permitted by subsection 8.4(e) so long as (i) at least 30 days' prior
written notice thereof is given to the Administrative Agent, (ii) all of the
capital stock of such new Subsidiary held by US Borrower or any Subsidiary is
pledged pursuant to a Securities Pledge Agreement and the certificates
representing such stock, together with stock powers duly executed in blank are
delivered to the Administrative Agent; provided, however, that (subject to
Section 7.18) not more than 65% of the capital stock of Foreign Subsidiaries
which are not CH Foreign Subsidiaries need be pledged, (iii) any such new
Subsidiary which is a Domestic Subsidiary shall have executed and delivered a
Domestic Subsidiary Guarantee and each other Security Document executed and
delivered by the Domestic Subsidiaries on the Closing Date and each such new CH
Foreign Subsidiary shall have executed a Foreign Subsidiary Guarantee and each
other Security Document executed and delivered by CH Foreign Subsidiaries on the
Closing Date (subject to applicable limitations under foreign law); provided,
however, that any Subsidiary which is prohibited by applicable local law from
entering into a Subsidiary Guarantee need not do so and (iv) to the extent
requested by the Administrative Agent or the Required Banks, takes all actions
required pursuant to Section 7.14 and Section 7.15. In addition, each new
Subsidiary which is a Domestic Subsidiary or a CH Foreign Subsidiary, as the
case may be, shall execute and deliver or cause to be executed and delivered all
other relevant documentation of the type described in Section 5 as such new
Subsidiary would have had to deliver if such new Subsidiary were a Domestic
Subsidiary or CH Foreign Subsidiary, as the case may be, on the Closing Date.
<PAGE>
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8.23 Designated Senior Debt. Neither Holding nor US Borrower will,
and each of them will not permit any Subsidiary to, designate or permit the
designation of any Indebtedness (other than the Obligations) as "Designated
Senior Indebtedness" or "Designated Guarantor Senior Indebtedness" for purposes
of, and as defined in, the Senior Subordinated Note Documents.
8.24 Issuance or Disposal of Subsidiary Stock. The Borrowers shall,
directly or indirectly, not: (a) issue, sell, assign, pledge or otherwise
encumber or dispose of any shares of capital stock, partnership interests, or
other equity securities of (or warrants, rights or options to acquire shares or
other equity securities of) any Subsidiary; or (b) cause or permit any
Subsidiary to, directly or indirectly, issue, sell, assign, pledge or otherwise
encumber or dispose of any of their respective or any of their respective
Subsidiaries' shares of capital stock, partnership interests, or other
securities (or warrants, rights or options to acquire any such shares or other
securities), except, in each case under clause (a) or (b), (i) to US Borrower or
any of its Wholly-Owned Subsidiaries, (ii) to qualify directors if required by
applicable law, (iii) the pledge thereof pursuant to the Security Documents and
(iv) as permitted by subsection 8.2(d) or (k) (provided, in each case, such sale
is for all of the capital stock of such Subsidiary) or by subsection 8.13(a) or
(b).
8.25 Limitation on Other Restrictions on Amendment of Basic
Documents. None of Holding, the Borrowers or the Subsidiaries shall enter into,
suffer to exist or become or remain subject to any agreement or instrument to
which any of them is a party or to which any of them or any property of any of
them (now owned or hereafter acquired) may be subject or bound (except for the
Loan Documents or the other Basic Documents (but with respect to the Basic
Documents that are not Loan Documents, only as to themselves)) that would
prohibit or restrict (including by way of any covenant, representation or
warranty or event of default), or require the consent of any Person to any
amendment to, or waiver or consent to departure from the terms of, any Basic
Document (which, in the case of the Basic Documents that are not Loan Documents,
would be materially adverse to the Lenders).
ARTICLE IX.
EVENTS OF DEFAULT
9.1. Event of Default. Any of the following shall constitute an
"Event of Default":
(a) Non-Payment. Any Loan Party fails to pay, (i) when and as
required to be paid herein, any principal of any Loan or of any L/C
Obligation or (ii) within three
<PAGE>
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days after the same becomes due, any interest, fee or any other amount
payable under any Loan Document.
(b) Representation or Warranty. Any representation or warranty by
any Loan Party made or deemed made in any Loan Document, or which is
contained in any certificate, document or financial or other statement by
any Loan Party or any Responsible Officer furnished at any time under any
Loan Document, is incorrect in any material respect on or as of the date
made or deemed made.
(c) Specific Defaults. Any Loan Party fails to perform or observe
any term, covenant or agreement contained in Section 7.3(a) or in Article
VIII.
(d) Other Defaults. Any Loan Party fails to perform or observe any
term, covenant or agreement (other than those referred to in subsections
9.1(a), (b) or (c) above) contained in any Loan Document, and such failure
shall continue unremedied for a period of at least 30 days after the date
upon which written notice thereof is given to the Borrowers by the
Administrative Agent or any Lender.
(e) Cross-Default. (i) Any Company fails to make any payment in
respect of any one or more issues of Indebtedness (other than the
Obligations) or Contingent Obligation having an aggregate principal of
more than the Dollar Equivalent amount of U.S. $5.0 million beyond the
period of grace, if any, provided in the instrument or agreement under
which such Indebtedness or Contingent Obligation was created or by which
it is governed; or (ii) any Company fails to perform or observe any other
term, condition or covenant, or any other event shall occur or condition
exist, under any agreement or instrument relating to any Indebtedness or
Contingent Obligation, if the effect of such failure, event or condition
is to cause, or to permit the holder or holders of such Indebtedness or
beneficiary or beneficiaries of such Indebtedness or Contingent Obligation
(or a trustee or agent on behalf of such holder or holders or beneficiary
or beneficiaries) to cause (with or without notice or passage of time or
both), such Indebtedness to be declared to be due and payable prior to its
stated maturity or such Contingent Obligation to become payable or cash
collateral in respect thereof to be demanded; provided, however, that the
aggregate amount of all such Indebtedness or Contingent Obligations so
affected and cash collateral so required shall be in a Dollar Equivalent
amount of U.S. $5.0 million or more.
(f) Insolvency; Voluntary Proceedings. Any Company (i) ceases or
fails to be solvent, or generally fails to pay, or admits in writing its
inability to pay, its debts as they become due; (ii) commences or consents
to any Insolvency Proceeding with respect to itself; or (iii) takes any
action to effectuate or authorize any of the foregoing.
<PAGE>
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(g) Involuntary Proceedings. (i) Any involuntary Insolvency
Proceeding is commenced or filed against any Company, or any writ,
judgment, warrant of attachment, execution or similar process is issued or
levied against a Company, and such proceeding or petition shall not be
dismissed, or such writ, judgment, warrant of attachment, execution or
similar process shall not be released, vacated or fully bonded, within 60
days after commencement, filing or levy; (ii) any Company admits the
material allegations of a petition against it in any Insolvency
Proceeding, or an order for relief (or similar order under non-U.S. law)
is ordered in any Insolvency Proceeding; or (iii) any Company acquiesces
in the appointment of a receiver, trustee, custodian, conservator,
liquidator, mortgagee in possession (or agent therefor), or other similar
person for itself or a substantial portion of its property or business.
(h) ERISA. (i) An ERISA Event shall occur with respect to a Pension
Plan or a Multiemployer Plan which has resulted or is reasonably likely to
result in liability of a Loan Party under Title IV of ERISA to such
Pension Plan or Multiemployer Plan or to the PBGC in an aggregate Dollar
Equivalent amount in excess of U.S. $5.0 million; or (ii) the aggregate
Dollar Equivalent amount of Unfunded Pension Liability among all Pension
Plans at any time exceeds U.S. $5.0 million and as a result thereof a lien
shall be imposed, a security interest shall be granted or a material
liability is incurred, which lien, security interest or liability, in the
reasonable judgment of the Required Lenders, is reasonably likely to
result in a Material Adverse Effect.
(i) Monetary Judgments. One or more non-interlocutory judgments,
non-interlocutory orders, decrees or arbitration awards is entered against
any Company involving in the aggregate a liability (to the extent not
covered by independent third-party insurance as to which the insurer does
not dispute coverage) as to any single or related series of transactions,
incidents or conditions, of a Dollar Equivalent amount of U.S. $5.0
million or more, and the same shall remain unvacated and unstayed pending
appeal for a period of 30 days after the entry thereof.
(j) Non-Monetary Judgments. Any non-monetary judgment, order or
decree is entered against any Company which does or would reasonably be
expected to have a Material Adverse Effect, and there shall be any period
of 30 consecutive days during which a stay of enforcement of such judgment
or order, by reason of a pending appeal or otherwise, shall not be in
effect.
(k) Guarantees. Any Guarantee ceases to be in full force and effect
(other than due to any effect of applicable foreign law or action by any
foreign government) or any of the Guarantors repudiates, or attempts to
repudiate, any of its obligations under any of the Guarantees.
<PAGE>
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(l) Security Documents. Any Security Document shall cease to be in
full force and effect (other than due to any effect of applicable foreign
law or action by any foreign government), or shall cease to give the
Administrative Agent the Liens, rights, powers and privileges purported to
be created thereby, in favor of the Administrative Agent, superior to and
prior to the rights of all third Persons and subject to no Liens other
than Prior Liens and Liens expressly permitted by the applicable Security
Document, or any judgment creditor having a Lien against any item of
Collateral shall commence legal action to foreclose such Lien or otherwise
exercise its remedies against any item of Collateral or either Borrower or
any Subsidiary fails to comply with or to perform any material obligation
or agreement under any Security Document within ten days after being
requested by the Administrative Agent or any Lender.
(m) Change of Control. Any Change of Control shall occur.
(n) Senior Subordinated Notes. The subordination provisions relating
to the any Senior Subordinated Note Document (the "Subordination
Provisions") shall fail to be enforceable by the Lenders (which have not
effectively waived the benefits thereof) in accordance with the terms
thereof, or any Obligation shall fail to constitute Senior Indebtedness or
Guarantor Senior Indebtedness (as defined in the Senior Subordinated Note
Documents); or Holding, US Borrower or any Subsidiary shall, directly or
indirectly, disavow or contest in any manner any of the Subordination
Provisions.
(o) Ciba Reimbursement Agreement. Any Borrower shall be in breach of
its obligations under the Ciba Reimbursement Agreement.
(p) Consummation of the M-T Acquisition. The M-T Acquisition shall
fail to be consummated promptly after the making of the Loans on the
Closing Date.
(q) Environmental Events. There shall have been asserted against any
Company, claims, whether accrued, absolute or contingent, based on or
arising from the generation, storage, transport, handling or disposal of
Hazardous Materials by any Company or any Affiliate, or any predecessor in
interest of any Company or any Affiliate, which claims are reasonably
likely to be determined adversely to any Company and the amount of any
such claim (insofar as it is payable by any Company but after deducting
any portion thereof which is reasonably expected to be paid, discharged or
forgiven by other creditworthy Persons jointly and severally liable
therefor), is, singly or in the aggregate, reasonably likely to have a
Material Adverse Effect.
9.2. Remedies. If any Event of Default occurs, the Administrative
Agent shall, at the request, or may, with the consent, of the Required Lenders:
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(a) declare the commitment of each Lender to make Loans and the
obligation of the L/C Lender to Issue Letters of Credit to be terminated,
whereupon such commitments and obligation shall be terminated;
(b) declare an amount equal to the maximum aggregate amount that is
or at any time thereafter may become available for drawing under any
outstanding Letters of Credit (whether or not any beneficiary shall have
presented, or shall be entitled at such time to present, the drafts or
other documents required to draw under such Letters of Credit) to be
immediately due and payable, and declare the unpaid principal amount of
all outstanding Loans, all interest accrued and unpaid thereon, and all
other amounts owing or payable hereunder or under any other Loan Document
to be immediately due and payable, without presentment, demand, protest or
other notice of any kind, all of which are hereby expressly waived by the
Borrowers;
(c) direct the Borrowers to pay (and the Borrowers agree that upon
receipt of such notice, or upon the occurrence of an Event of Default
specified in subsection 9.1(f) or (g) with respect to either Borrower,
such Borrower will pay) to the Administrative Agent at the Administrative
Agent's Payment Office such additional amount of cash, to be held as
security by the Administrative Agent, as is equal to the aggregate undrawn
face amount of all Letters of Credit issued for the account of either
Borrower and then outstanding; and
(d) exercise on behalf of the Administrative Agent and the Lenders
all rights and remedies available to the Administrative Agent and the
Lenders under the Loan Documents or applicable law;
provided, however, that upon the occurrence of any event specified in subsection
(f) or (g) of Section 9.1, the obligation of each Lender to make Loans and any
obligation of the L/C Lender to Issue Letters of Credit, shall automatically
terminate and the unpaid principal amount of all outstanding Loans and all
interest and other amounts as aforesaid shall automatically become due and
payable without further act of the Administrative Agent, the L/C Lender or any
other Lender.
9.3. Rights Not Exclusive. The rights provided for in this Agreement
and the other Loan Documents are cumulative and are not exclusive of any other
rights, powers, privileges or remedies provided by law or in equity, or under
any other instrument, document or agreement now existing or hereafter arising.
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ARTICLE X.
THE AGENTS
10.1. Appointment and Authorization. (a) Each Lender hereby
irrevocably (subject to Section 10.9) appoints, designates and authorizes the
Administrative Agent to take such action on its behalf under the provisions of
this Agreement and each other Loan Document and to exercise such powers and
perform such duties as are expressly delegated to it by the terms of this
Agreement or any other Loan Document, together with such powers as are
reasonably incidental thereto. The Administrative Agent is expressly authorized
to execute and deliver all Security Documents on the Closing Date and take all
actions incidental or related thereto. Notwithstanding any provision to the
contrary contained elsewhere in this Agreement or in any other Loan Document,
none of the Administrative Agent, the Documentation Agent, the Arranger or any
Co-Agent shall have any duties or responsibilities except those expressly set
forth herein, nor shall any of the Administrative Agent, the Documentation
Agent, the Arranger or any Co-Agent have or be deemed to have any fiduciary
relationship with any Lender, and no implied covenants, functions,
responsibilities, duties, obligations or liabilities shall be read into this
Agreement or any other Loan Document or otherwise exist against any of the
Administrative Agent, the Documentation Agent, the Arranger or any Co-Agent or
any of their affiliates. The provisions of this Article X are solely for the
benefit of the Agents, the Co-Agents and the Lenders, and no Loan Party shall
have any rights as a third party beneficiary of any of the provisions hereof. In
performing its functions and duties under this Agreement, the Administrative
Agent shall act solely as Administrative Agent of the Lenders and the
Administrative Agent does not assume and shall not be deemed to have assumed any
obligation or relationship of agency or trust with or for any Loan Party. None
of the Documentation Agent, the Arranger or any Co-Agent shall have any
responsibilities under any Loan Document, except as expressly set forth therein.
(b) The L/C Lender shall act on behalf of the Revolving Facility
Lenders with respect to any Letters of Credit Issued by it and the documents
associated therewith until such time and except for so long as the
Administrative Agent may agree at the request of the Required Lenders to act for
the L/C Lender with respect thereto; provided, however, that the L/C Lender
shall have all of the benefits and immunities (i) provided to the Administrative
Agent in this Article X with respect to any acts taken or omissions suffered by
the L/C Lender in connection with Letters of Credit Issued by it or proposed to
be Issued by it and the application and agreements for letters of credit
pertaining to the Letters of Credit as fully as if the term "Administrative
Agent," as used in this Article X, included the L/C Lender with respect to such
acts or omissions and (ii) as additionally provided in this Agreement with
respect to the L/C Lender.
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(c) Each Swing Line Lender shall have all of the benefits and
immunities (i) provided to the Administrative Agent in this Article X with
respect to any acts taken or omissions suffered by such Swing Line Lender in
connection with Swing Line Loans made or proposed to be made by it as fully as
if the term "Administrative Agent," as used in this Article X, included the
Swing Line Lenders with respect to such acts or omissions and (ii) as
additionally provided in this Agreement with respect to the Swing Line Lenders.
10.2. Delegation of Duties. The Administrative Agent may execute any
of its duties under this Agreement or any other Loan Document by or through
agents, employees or attorneys-in-fact and shall be entitled to advice of
counsel concerning all matters pertaining to such duties. The Administrative
Agent shall not be responsible for the negligence or misconduct of any agent or
attorney-in-fact that it selects with reasonable care.
10.3. Exculpatory Provisions. None of the Administrative Agent, the
Documentation Agent, the Arranger, any Co-Agent or any of their respective
Affiliates shall (i) be liable for any action taken or omitted to be taken by
any of them under or in connection with this Agreement or any other Loan
Document or under any other document or instrument referred to or provided for
herein or therein or the transactions contemplated hereby or thereby (except for
its own gross negligence or willful misconduct), (ii) be responsible in any
manner to any of the Lenders for any recital, statement, representation or
warranty made by any Loan Party or any Subsidiary or Affiliate of any Loan
Party, or any officer thereof, contained in this Agreement or in any other Loan
Document, or in any certificate, report, statement or other document referred to
or provided for in, or received by any of them under or in connection with, this
Agreement or any other Loan Document, or the value, validity, effectiveness,
genuineness, enforceability or sufficiency of this Agreement or any other Loan
Document or any other document referred to or provided for herein or therein, or
for any failure of any Loan Party or any other party to any Loan Document to
perform its obligations hereunder or thereunder, (iii) except to the extent
that, with respect to the Administrative Agent, it is expressly instructed by
the Lenders with respect to collateral security under the Security Documents, be
required to initiate or conduct any litigation or collection proceedings
hereunder or under any other Loan Document or (iv) with respect to the
Administrative Agent, be under any obligation to take any action hereunder or
under any other Loan Document if the Administrative Agent believes in good faith
that taking such action may conflict with any law or any provision of any Loan
Document, or may require the Administrative Agent to qualify to do business in
any jurisdiction where it is not then so qualified. None of the Administrative
Agent, the Documentation Agent, the Arranger, any Co-Agent or any of their
respective Affiliates shall be under any obligation to any Lender to ascertain
or to inquire as to the observance or performance of any of the agreements
contained in, or conditions of, this Agreement or any other Loan Document, or to
inspect the properties, books or records of any Loan Party or any Subsidiary or
Affiliate of any Loan Party.
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10.4. Reliance by Administrative Agent. (a) The Administrative Agent
shall be entitled to rely, and shall be fully protected in relying, upon any
writing, resolution, notice, consent, certificate, affidavit, letter, telegram,
facsimile, telex or telephone message, statement or other document or
conversation believed by it to be genuine and correct and to have been signed,
sent or made by or on behalf of the proper Person or Persons, and upon advice
and statements of legal counsel (including counsel to any Loan Party or any
Subsidiary), independent accountants and other experts selected by the
Administrative Agent. The Administrative Agent shall be fully justified in
failing or refusing to take any action under this Agreement or any other Loan
Document, unless it shall first receive such advice or concurrence of the
Required Lenders as it deems appropriate and, if it so requests, it shall first
be indemnified to its satisfaction by the Lenders against any and all liability
and expense which may be incurred by it by reason of taking or continuing to
take any such action. The Administrative Agent shall in all cases be fully
protected in acting, or in refraining from acting, under this Agreement or any
other Loan Document, in accordance with a request or consent of the Required
Lenders, and such request and any action taken or failure to act pursuant
thereto shall be binding upon all of the Lenders.
(b) For purposes of determining compliance with the conditions
specified in Section 5.1, each Lender that has executed this Agreement shall be
deemed to have consented to, approved or accepted or to be satisfied with each
document or other matter either sent by the Administrative Agent to such Lender
for consent, approval, acceptance or satisfaction, or required thereunder to be
consented to or approved by or acceptable or satisfactory to the Lender.
10.5. Notice of Default. The Administrative Agent shall not be
deemed to have knowledge or notice of the occurrence of any Event of Default or
Unmatured Event of Default, unless the Administrative Agent shall have received
written notice from a Lender or a Borrower referring to this Agreement,
describing such Event of Default or Unmatured Event of Default and stating that
such notice is a "notice of default." If the Administrative Agent receives such
a notice, the Administrative Agent will notify the Lenders of its receipt
thereof. The Administrative Agent shall take such action with respect to such
Event of Default or Unmatured Event of Default as may be requested by the
Required Lenders in accordance with Article IX; provided, however, that, unless
and until the Administrative Agent has received any such request, the
Administrative Agent may (but shall not be obligated to) take such action, or
refrain from taking such action, with respect to such Event of Default or
Unmatured Event of Default as it shall deem advisable or in the best interest of
the Lenders except to the extent that this Agreement expressly requires
otherwise.
10.6. Credit Decision. Each Lender acknowledges that none of the
Administrative Agent, the Documentation Agent, the Arranger, any Co-Agent or any
of their respective Affiliates has made any representation or warranty to it,
and that no act by the
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Administrative Agent hereafter taken, including any review of the affairs of any
Loan Party, shall be deemed to constitute any representation or warranty by the
Administrative Agent, the Documentation Agent, the Arranger, any Co-Agent or any
Lender. None of the Administrative Agent, the Documentation Agent, the Arranger
or any Co-Agent shall be required to keep itself informed as to the performance
or observance by any Lender of this Agreement or any of the other Loan Documents
or any other document referred to or provided for herein or therein or to
inspect the properties or books of any Loan Party. Each Lender represents to the
Administrative Agent, the Documentation Agent, the Arranger and the Co-Agents
that it has, independently and without reliance upon the Administrative Agent,
the Documentation Agent, the Arranger, any Co-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, prospects, operations,
property, financial and other condition and creditworthiness of the Loan
Parties, and all applicable bank regulatory laws relating to the transactions
contemplated hereby, and made its own decision to enter into this Agreement and
to extend credit hereunder. Each Lender also represents that it will,
independently and without reliance upon the Administrative Agent, the
Documentation Agent, the Arranger, any Co-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 or any other Loan Document, and to make
such investigations as it deems necessary to inform itself as to the business,
prospects, operations, property, financial and other condition and
creditworthiness of the Loan Parties. Except for notices, reports and other
documents and information expressly herein required to be furnished to the
Lenders by the Administrative Agent, none of the Administrative Agent, the
Documentation Agent, the Arranger or any Co-Agent shall have any duty or
responsibility to provide any Lender with any credit or other information
concerning the business, prospects, operations, property, financial and other
condition or creditworthiness of the Loan Parties which may come into the
possession of the Administrative Agent, the Documentation Agent, the Arranger,
any Co-Agent or any of their respective Affiliates.
10.7. Indemnification. Whether or not the transactions contemplated
hereby are consummated, the Lenders shall indemnify upon demand the
Administrative Agent, the Documentation Agent, the Arranger, the Co-Agents and
each of their respective Affiliates (to the extent not reimbursed by or on
behalf of the Borrowers in accordance with the terms hereof and without limiting
the obligation of the Borrowers to do so), pro rata (determined on the same
basis used in determining Required Lenders), from and against any and all Losses
which may at any time be imposed on, incurred by or asserted against the
Administrative Agent, the Documentation Agent, the Arranger or any Co-Agent in
their respective capacity as such (including by any Lender) arising out of or by
reason of any investigation in any way relating to or arising out of this
Agreement or any other Loan Document, or any documents contemplated by or
referred to herein or therein or the transactions contemplated hereby or
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thereby or the enforcement of any of the terms hereof or thereof or of any such
other documents; provided, however, that no Lender shall be liable for the
payment to the Administrative Agent, the Documentation Agent, the Arranger or
any Co-Agent or any of their respective Affiliates of any portion of the Losses
resulting from such Person's gross negligence or willful misconduct. Without
limitation of the foregoing, each Lender shall reimburse the Administrative
Agent upon demand for its ratable share (determined on the same basis used in
determining Required Lenders) of any costs or out-of-pocket expenses (including
Attorney Costs) incurred by the Administrative Agent in connection with the
preparation, execution, delivery, administration, modification, amendment or
enforcement (whether through negotiations, legal proceedings or otherwise) of,
or legal advice in respect of rights or responsibilities under, this Agreement,
any other Loan Document, or any document contemplated by or referred to herein
or therein, to the extent that the Administrative Agent is not reimbursed for
such expenses by or on behalf of the Borrowers. The agreements set forth in this
Section 10.7 shall survive the payment of all Loans and other obligations
hereunder and the resignation or replacement of the Administrative Agent and
shall be in addition to and not in lieu of any other indemnification agreements
contained in any other Loan Document.
10.8. Administrative Agent in Individual Capacity. The
Administrative Agent and its Affiliates may make loans to, issue letters of
credit for the account of, accept deposits from, acquire equity interests in and
generally engage in any kind of banking, trust, financial advisory, underwriting
or other business with the Loan Parties and Affiliates of the Loan Parties as
though the Administrative Agent were not the Administrative Agent hereunder,
without notice to or consent of the Lenders. The Lenders acknowledge that,
pursuant to such activities, the Administrative Agent and its Affiliates may
receive information regarding the Loan Parties or their Affiliates (including
information that may be subject to confidentiality obligations in favor of the
Borrowers or such Affiliates) and acknowledge that the Administrative Agent and
its Affiliates shall be under no obligation to provide such information to them.
With respect to its Loans, the Administrative Agent (and any of its Affiliates
which may become a Lender) shall have the same rights and powers under this
Agreement as any other Lender and may exercise the same as though it were not
the Administrative Agent or the L/C Lender. The terms "Lender" and "Lenders"
shall, unless the context otherwise indicates, include the Administrative Agent
in its individual capacity.
10.9. Successor Administrative Agent. The Administrative Agent may,
and at the request of the Required Lenders shall, resign as Administrative Agent
upon 30 days' notice to the Lenders and the Borrowers. If the Administrative
Agent resigns under this Agreement, the Required Lenders shall appoint from
among the Lenders a successor Administrative Agent which successor agent shall,
so long as no Event of Default exists, be subject to the approval of the
Borrowers (which approval shall not be unreasonably withheld or delayed). If no
successor agent is appointed prior to the effective date of the resignation of
the Administrative
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Agent, the Administrative Agent may appoint, after consulting with the Lenders
and the Borrowers, a successor agent, from among the Lenders. Upon the
acceptance of its appointment as successor agent hereunder, such successor agent
shall succeed to all the rights, powers and duties of the retiring
Administrative Agent, "Administrative Agent" shall mean such successor agent and
the retiring Administrative Agent's appointment, powers and duties as
Administrative Agent shall be terminated. After the retiring Administrative
Agent's resignation hereunder as Administrative Agent, the provisions of this
Article X and Section 11.4 shall inure to its benefit as to any actions taken or
omitted to be taken by it while it was the Administrative Agent under this
Agreement. If no successor agent has accepted appointment as the Administrative
Agent by the date which is 30 days following the retiring Administrative Agent's
notice of resignation, the retiring Administrative Agent's resignation shall
nevertheless thereupon become effective and the Lenders shall perform all of the
duties of the Administrative Agent hereunder until such time, if any, as the
Required Lenders appoint a successor agent as provided for above. Each successor
Administrative Agent shall comply with subsection 4.1(f).
10.10. Holders. The Administrative Agent may deem and treat the
payee of any Note as the owner thereof for all purposes hereof unless and until
a written notice of the assignment, transfer or endorsement thereof, as the case
may be, shall have been filed with the Administrative Agent. Any request,
authority or consent of any Person or entity who, at the time of making such
request or giving such consent, is the holder of any Note shall be conclusive
and binding on any subsequent holder, transferee, assignee or indorsee, as the
case may be, of such Note or of any Note or Notes issued in exchange therefor.
10.11. Failure to Act. Except for action expressly required of the
Administrative Agent hereunder and under the other Loan Documents, the
Administrative Agent shall in all cases be fully justified in failing or
refusing to act hereunder and thereunder unless it shall receive further
assurances to its satisfaction from the Lenders of their indemnification
obligations under Section 10.7 against any and all liability and expense that
may be incurred by it by reason of taking or continuing to take any such action.
ARTICLE XI.
MISCELLANEOUS
11.1. Amendments and Waivers. (a) No amendment or waiver of any
provision of this Agreement or any other Loan Document, and no consent with
respect to any departure by either Borrower therefrom, shall be effective unless
the same shall be in writing and signed by the Required Lenders (or by the
Administrative Agent at the written request of the Required Lenders) and the
Borrowers and acknowledged by the Administrative Agent, and then any such
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waiver or consent shall be effective only in the specific instance and for the
specific purpose for which given; provided, however, that no such waiver,
amendment or consent shall, unless in writing and signed by all the
Non-Defaulting Lenders and the Borrowers and the Subsidiary Swing Line Borrowers
and acknowledged by the Administrative Agent, do any of the following: (i)
increase or extend the term of any of the Commitments (it being understood that
a waiver of any condition, covenant violation, Event of Default or Unmatured
Event of Default shall not constitute a change in the terms of any Commitment of
any Lender) or extend the time or waive any requirement for the reduction or
termination of any of the Commitments (or reinstate any Commitment terminated
pursuant to Section 9.2) or change the currency in which any Loan or L/C
Obligation is payable, except as expressly permitted herein (provided that the
consent of the Lenders whose Loans or Commitments are being so changed (and none
other) shall be required); (ii) postpone or delay any date fixed by subsection
2.9(a) or (b) for any payment of any Amortization Payment or for any payment of
interest, fees or other amounts (other than any prepayment of the Term Loans as
a result of any of the events set forth in Section 2.7) due to the Lenders (or
any of them) under any Loan Document; (iii) reduce the principal of, or the rate
of interest specified herein (other than as a result of waiving the
applicability of any post-default increase in interest rates) on, any Loan or
(subject to clause (5) below) any fees or other amounts payable under any Loan
Document; (iv) modify the definition of the term "Required Lenders", "Required
Revolving Facility Lenders", "Majority Lenders of the Affected Tranche" or
"Supermajority Lenders" or change the percentage of the Commitments or of the
aggregate unpaid principal amount of the Loans and L/C Obligations which is
required for the Non-Defaulting Lenders or any of them to take any action
hereunder; (v) release any material portion of the Collateral (except as
expressly permitted by the Loan Documents); (vi) amend this Section 11.1,
Section 2.15, Article IV, or Section 11.4 or any provision herein or under any
Loan Document providing for consent or other action by all Lenders; (vii)
release any Guarantor from its obligations under its Guarantee (except upon a
permitted sale of such Guarantor); or (viii) consent to the assignment or
transfer by any Loan Party of its rights and obligations under any Loan Document
or the making of any assignment of Loans or other Obligations or participation
therein to any Loan Party or any Affiliate thereof; provided, further, however,
that (1) no amendment, waiver or consent shall, unless in writing and signed by
the L/C Lender in addition to the Required Lenders or all Non-Defaulting
Lenders, as the case may be, affect the rights or duties of the L/C Lender under
this Agreement or any L/C-Related Document, (2) no amendment, waiver or consent
shall, unless in writing signed by the Swing Line Lenders in addition to the
Required Lenders or all Non-Defaulting Lenders, as the case may be, affect the
rights or duties of any Swing Line Lender under any Loan Document, (3) no
amendment, waiver or consent shall, unless in writing and signed by the
applicable Agent in addition to the Required Lenders or all Non-Defaulting
Lenders, as the case may be, affect the rights or duties of the applicable Agent
under any Loan Document, (4) no amendment, waiver or consent (including any of
the foregoing with respect to any representation, warranty, covenant, default or
other matter which is otherwise effective for purposes of this Agreement) shall,
unless in writing and
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signed by the Required Revolving Facility Lenders, be effective for determining
whether the conditions precedent to any Credit Extension under the Revolving
Facility have been satisfied, (5) the Fee Letters may be amended, or rights or
privileges thereunder waived, in accordance with their respective terms and (6)
no amendment, waiver or consent shall, unless in writing signed by the Majority
Lenders of the Affected Tranche, in addition to the Required Lenders, change the
application of prepayments under Section 2.7 as among the Term Loan Facilities
or the order in which such prepayments are applied to any such Facility
(although any required prepayment under Section 2.7 may be waived or amended, in
whole or in part, by the Supermajority Lenders so long as the application of any
such prepayment which is still made is not altered); provided, further, still,
however, that no amendment, waiver or consent shall, unless in writing signed by
the Supermajority Lenders, amend, waive or consent to the departure from any
required prepayment under Section 2.7. In the case of any waiver effected in
accordance with this Section 11.1, the Loan Parties, the Lenders and the
Administrative Agent shall be restored to their former position and rights under
each Loan Document, and any Event of Default or Unmatured Event of Default
waived shall be deemed to be cured and not continuing; but no such waiver shall
extend to any subsequent or other Event of Default or Unmatured Event of
Default, or impair any right consequent thereon. Any amendment, waiver or
consent effected in accordance with this Section 11.1 shall be binding upon each
holder of the Notes at the time outstanding, each future holder of the Notes
and, if signed by the Borrowers and the Subsidiary Swing Line Borrowers, on the
Borrowers and the Subsidiary Swing Line Borrowers and the other Loan Parties.
(b) If, in connection with any proposed amendment, waiver or consent
to any of the provisions of this Agreement as contemplated by clauses
(i)-(viii), inclusive, of the first proviso to subsection 11.1(a), the consent
of the Required Lenders is obtained but the consent of one or more of such other
Lenders whose consent is required is not obtained, then the Borrowers and the
Subsidiary Swing Line Borrowers shall have the right to replace each such
non-consenting Lender or Lenders (so long as all non-consenting Lenders are so
replaced) with one or more Replacement Lenders pursuant to Section 4.8 so long
as at the time of such replacement each such Replacement Lender consents to the
proposed amendment, waiver or consent; provided, however, that the Borrowers and
the Subsidiary Swing Line Borrowers shall not have the right to replace a Lender
solely as a result of the exercise of such Lender's rights (and the withholding
of any required consent by such Lender) pursuant to the second or third proviso
to subsection 11.1(a).
11.2. Notices. (a) Except as otherwise expressly provided herein,
all notices, requests and other communications hereunder and under the Security
Documents (including any modifications of, or waivers, requests or consents
under, this Agreement) shall be in writing (including, unless the context
expressly otherwise provides, by facsimile transmission; provided, however, that
any matter transmitted by either Borrower or any Subsidiary Swing Line Borrower
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(x) to the Administrative Agent or any Applicable Swing Line Lender by facsimile
shall be immediately confirmed by a telephone call to the recipient at the
number specified on Schedule 11.2 and (y) to any Lender by facsimile shall be
immediately confirmed by a telephone call to the recipient at the number
specified on Schedule 11.2 or by overnight mail to the recipient at the address
specified on Schedule 11.2) and mailed, faxed or delivered to the applicable
party at the address or facsimile number specified for notices on Schedule 11.2
(which such facsimile notices shall be confirmed by overnight mail); or, as
directed to either Borrower or any Subsidiary Swing Line Borrower or the
Administrative Agent or any Applicable Swing Line Lender, to such other address
as shall be designated by such party in a written notice to the other parties,
and as directed to any other party, at such other address as shall be designated
by such party in a written notice to the Borrowers and the Subsidiary Swing Line
Borrowers and the Administrative Agent and the Applicable Swing Line Lenders (it
being understood that these provisions with respect to any Applicable Swing Line
Lenders and any Subsidiary Swing Line Borrower to which it has agreed to make
Swing Line Loans shall apply only to such parties).
(b) All such notices, requests and communications shall be
effective, (i) if transmitted by overnight delivery or faxed, when delivered or
transmitted in legible form by facsimile machine, respectively, (ii) if mailed,
upon receipt or (iii) if delivered, upon delivery; except that notices pursuant
to Article II, III or X to the Administrative Agent shall not be effective until
actually received by the Administrative Agent, and notices pursuant to Article
III to the L/C Lender shall not be effective until actually received by the L/C
Lender.
(c) Any agreement of the Administrative Agent and the Lenders herein
to receive certain notices by telephone or facsimile is solely for the
convenience and at the request of the Borrowers and the Subsidiary Swing Line
Borrowers. The Administrative Agent and the Lenders shall be entitled to rely on
the authority of any Person purporting to be a Person authorized by a Borrower
or a Subsidiary Swing Line Borrower to give such notice, and the Administrative
Agent and the Lenders shall not have any liability to the Borrowers or any
Subsidiary Swing Line Borrower or any other Person on account of any action
taken or not taken by the Administrative Agent or any Lender in reliance upon
such telephonic or facsimile notice. The obligation of the Borrowers and the
Subsidiary Swing Line Borrowers to repay the Loans and L/C Obligations shall not
be affected in any way or to any extent by any failure by the Administrative
Agent or any Lender to receive written confirmation of any telephonic or
facsimile notice or the receipt by the Administrative Agent or any Lender of a
confirmation which is at variance with the terms understood by the
Administrative Agent or such Lender to be contained in the telephonic or
facsimile notice.
11.3. No Waiver; Cumulative Remedies. No failure to exercise and no
delay in exercising, on the part of the Administrative Agent or any Lender, any
right, remedy, power or privilege hereunder or under any other Loan Document,
and no course of dealing between
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any Loan Party and any of the Administrative Agent or Lenders shall operate as a
waiver thereof; nor shall any single or partial exercise of any right, remedy,
power or privilege hereunder or under any other Loan Document preclude any other
or further exercise thereof or the exercise of any other right, remedy, power or
privilege hereunder or under such other Loan Document. The rights and remedies
expressly provided herein are cumulative and not exclusive of any rights or
remedies provided by law. No notice to or demand upon any Loan Party in any case
shall entitle any Loan Party to any other or further notice or demand in similar
or other circumstances or constitute a waiver of the rights of the Agents or the
Lenders to any other or further action in any circumstance without notice or
demand.
11.4. Expenses, Indemnity, etc. The Borrowers agree: (a) to pay or
reimburse the Agents for all of their reasonable out-of-pocket costs and
expenses (including the reasonable fees and expenses of Cahill Gordon & Reindel
and of all local and foreign counsel) in connection with (i) the negotiation,
preparation, execution and delivery of this Agreement and the other Loan
Documents and the extensions of credit hereunder, the administration of the
transactions contemplated hereby (including the monitoring of the Collateral)
and the Arranger's syndication efforts (including the Agents' due diligence
investigation expenses) with respect to this Agreement and (ii) the negotiation
or preparation of any modification, supplement or waiver of any of the terms of
this Agreement or any of the other Loan Documents (whether or not consummated or
effective); (b) to pay or reimburse each of the Lenders and the Administrative
Agent for all reasonable out-of-pocket costs and expenses of the Lenders and the
Administrative Agent (including Attorney Costs of the Administrative Agent and
the Lenders) in connection with (i) protection of the Lenders' rights following
any Event of Default and any enforcement or collection proceedings resulting
therefrom, including all manner of participation in or other involvement with
(x) bankruptcy, insolvency, receivership, foreclosure, winding up or liquidation
proceedings, (y) judicial or regulatory proceedings and (z) workout,
restructuring or other negotiations or proceedings (whether or not the workout,
restructuring or transaction contemplated thereby is consummated) and (ii) the
enforcement of this Section 11.4; and (c) to pay or reimburse each of the
Lenders and the Administrative Agent for all transfer, stamp, documentary or
other similar taxes, assessments or charges levied by any governmental or
revenue authority in respect of this Agreement or any of the other Loan
Documents or any other document referred to herein or therein and all costs,
expenses, taxes, assessments and other charges (including title insurance and
Attorney Costs) incurred in connection with any filing, registration, recording
or perfection of any security interest contemplated by any Loan Document or any
other document referred to therein.
The Borrowers agree, whether or not the transactions contemplated
hereby are consummated, to indemnify each Lender, each Agent, each Co-Agent and
each of their respective directors, officers, employees, attorneys, trustees and
agents (each, an "Indemnified Person") from, and hold each of them harmless
against, any and all Losses incurred by any of
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them in connection with any Proceeding (whether or not any Agent, any Co-Agent
or any Lender is a party thereto and whether or not brought by or on behalf of
any Loan Party or any other Person) arising out of or by reason of relating to
any of the Loan Documents, the extensions of credit hereunder or any actual or
proposed use by either Borrower or any Subsidiary Swing Line Borrower or any
Subsidiary of the proceeds of any of the extensions of credit hereunder or the
use of any collateral security for the Loans (including the exercise by the
Administrative Agent or any Lender of the rights and remedies or any power of
attorney with respect thereto and any action or inaction in respect thereof),
but excluding any such Losses to the extent resulting from the gross negligence
or bad faith of the Indemnified Person. Without limiting the generality of the
foregoing, the Borrowers agree to (x) indemnify the Administrative Agent for any
payments that the Administrative Agent is required to make under any indemnity
issued to any Lender referred to in any Security Document and (y) indemnify each
Lender and each other Indemnified Person from, and hold each Lender and each
other Indemnified Person harmless against, any Losses described in the preceding
sentence (net of insurance proceeds actually received but excluding, as provided
in the preceding sentence, any Loss to the extent resulting from the gross
negligence or bad faith of such Indemnified Person) arising under any
Environmental Law based on or arising out of (A) the past, present or future
operations of either Borrower or any Subsidiary (or any predecessor in interest
to either Borrower or any Subsidiary), (B) the past, present or future condition
of any facility or property owned, operated or leased at any time by either
Borrower or any Subsidiary (or any of their respective predecessors in
interest), or (C) any Release or threatened Release of any Hazardous Materials
at, under or from any such facility or property, including, without limitation,
any such Release or threatened Release that shall occur during any period when
any Lender or other Indemnified Person shall be in possession of any such
facility or property following the exercise by such Lender or other Indemnified
Person of any of its rights and remedies hereunder or under any of the Security
Documents, and the alleged disposal or alleged arranging for disposal or
treatment of any Hazardous Materials by either Borrower or any Subsidiary (or
any of their respective predecessors in interest) at any third-party site.
To the extent that the undertaking to indemnify and hold harmless
set forth in this Section 11.4 is unenforceable because it is violative of any
law or public policy or otherwise, the Borrower shall contribute the maximum
portion that each of them is permitted to pay and satisfy under applicable law
to the payment and satisfaction of all indemnified liabilities incurred by any
of the Persons indemnified hereunder.
The Borrowers also agree that no Indemnified Person shall have any
liability (whether direct or indirect, in contract or tort or otherwise) for any
Losses to any Loan Party or any Loan Party's security holders or creditors
resulting from, arising out of, in any way related to or by reason of, any
matter referred to in the second paragraph of this Section 11.4,
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except to the extent that any Loss resulted from the gross negligence or bad
faith of such Indemnified Person.
In the event that any Indemnified Person is requested or required to
appear as a witness in any Proceeding brought by or on behalf of or against any
Loan Party or any affiliate of any Loan Party in which such Indemnified Person
is not named as a defendant, the Borrowers agree to reimburse each Indemnified
Person for all reasonable out-of-pocket expenses and all reasonable allocable
costs of in-house legal counsel incurred by each Indemnified Person in
connection with such Indemnified Person's appearing and preparing to appear as
such a witness, including the reasonable fees and disbursements of one common
counsel for all Indemnified Persons.
The Borrowers agree that, without the prior written consent of the
Administrative Agent, the Arranger and the Required Lenders, no Loan Party will
settle, compromise or consent to the entry of any judgment in any pending or
threatened Proceeding in respect of which indemnification could be sought under
the indemnification provisions of this Section 11.4 (whether or not any
Indemnified Person is an actual or potential party to such Proceeding), unless
such settlement, compromise or consent includes an unconditional written release
reasonably satisfactory to the Administrative Agent, the Arranger and the
Required Lenders of each Indemnified Person from all liability arising out of
such Proceeding and does not include any statement as to an admission of fault,
culpability or failure to act by or on behalf of any Indemnified Person and does
not involve any payment of money or other value by any Indemnified Person or any
injunctive relief or factual findings or stipulations binding on any Indemnified
Person. No Indemnified Person shall settle, compromise or consent to the entry
of any judgment in any pending or threatened Proceeding without the prior
written consent of the Borrowers, which consent shall not be unreasonably
withheld or delayed.
11.5. Payments Pro Rata. Subject to Section 2.15, the Administrative
Agent agrees that promptly after its receipt of each payment from or on behalf
of any Loan Party in respect of any Obligations of such Loan Party, it shall
distribute such payment to the Lenders based upon their respective Pro Rata
Shares, if any, of the Obligations with respect to which such payment was
received.
11.6. Payments Set Aside. To the extent that a Borrower or a
Subsidiary Swing Line Borrower makes a payment to the Administrative Agent or
any Lender, or the Administrative Agent or any Lender exercises its right of
set-off, and such payment or the proceeds of such set-off or any part thereof is
subsequently invalidated, declared to be fraudulent or preferential, set aside
or required (including pursuant to any settlement entered into by the
Administrative Agent or such Lender in its discretion) to be repaid to a
trustee, receiver or any other party, in connection with any Insolvency
Proceeding or otherwise, then (a) to the
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extent of such recovery the obligation or part thereof originally intended to be
satisfied shall be revived and continued in full force and effect as if such
payment had not been made or such set-off had not occurred and (b) each Lender
severally agrees to pay to the Administrative Agent upon demand its pro rata
share of any amount so recovered from or repaid by the Administrative Agent.
11.7. Successors and Assigns. The provisions of this Agreement shall
be binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns.
11.8. Assignments and Participations, etc. (a) No Borrower or any
Subsidiary Swing Line Borrower may assign their rights or obligations hereunder
or under the Notes without the prior written consent of all of the Lenders and
the Administrative Agent.
(b) Any Lender may, with the written consent of the Borrowers (which
consent shall not be unreasonably withheld or delayed (it being understood that,
among other things, the imposition of any withholding tax on payments to such
Eligible Assignee at the time of assignment or the inability of an Eligible
Assignee to provide Loans in an Offshore Currency at the time of assignment
(unless all Lenders are then so unable) shall be reasonable grounds to withhold
consent)) and the Administrative Agent (and Scotiabank in its capacity as a
Swing Line Lender and Scotiabank in its capacity as an L/C Lender in the case of
any assignment of Revolving Facility Commitments), at any time assign and
delegate to one or more Eligible Assignees (provided that, except with respect
to any assignment of a Tranche C(CH) Note, Tranche A Note or Revolving Note,
each of which shall require the consent of the Borrowers as described above, no
written consent of the Borrowers, the Administrative Agent, any Swing Line
Lender or any L/C Lender shall be required in connection with any assignment and
delegation by a Lender to an Eligible Assignee that is an Affiliate of such
Lender or to another Lender) (each an "Assignee") (in which case, the Assignee
and assignor Lenders shall give notice of the assignment to the Administrative
Agent) all or any part of the Loans, the Commitments, the L/C Obligations and
the other rights and obligations of such Lender hereunder, in a minimum Dollar
Equivalent amount of U.S. $5.0 million or, if less, the entire amount of all
Loans, the Commitments, L/C Obligations and other rights and obligations of such
Lender hereunder in any Facility; provided, however, that (i) in no event may
any such assignment be made to the Borrowers or any of their Affiliates; and
(ii) the Borrowers, the Subsidiary Swing Line Borrowers and the Administrative
Agent may continue to deal solely and directly with such Lender in connection
with the interest so assigned to an Assignee until (x) written notice of such
assignment, together with payment instructions, addresses and related
information with respect to the Assignee, shall have been given to the Borrowers
and the Administrative Agent by such Lender and the Assignee; (y) such Lender
and its Assignee shall have delivered to the Borrowers and the Administrative
Agent an Assignment and Acceptance in the form of Exhibit G ("Assignment and
Acceptance") together with any Note or Notes
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subject to such assignment and (z) the assignor Lender shall have paid to the
Administrative Agent a processing fee in the amount of U.S. $3,000.
Notwithstanding any other term of this subsection 11.8(b), the agreement of any
Swing Line Lender to provide the Swing Line Commitment shall not impair or
otherwise restrict in any manner the ability of such Swing Line Lender to make
any assignment of its Loans or Commitments in accordance with the provisions of
this Section 11.8, it being understood and agreed that such Swing Line Lender
may terminate its Swing Line Commitment, either in whole or in part, in
connection with the making of any assignment; provided, however, that the
Assignee assumes the Swing Line Commitment of such Swing Line Lender. At the
time of each assignment pursuant to this subsection 11.8(b) to a Person which is
not already a Lender hereunder within the same Facility, the Assignee shall
provide to the Borrowers, the Subsidiary Swing Line Borrowers and the
Administrative Agent the appropriate forms and certificates described in
subsection 4.1(f) (except to the extent expressly provided otherwise). To the
extent that an assignment of all or any portion of a Lender's Commitments and
related outstanding Obligations pursuant to this subsection 11.8(b) would, at
the time of such assignment, result in increased costs payable to such assignee
Lender under Section 4.1, 4.3 or 4.4 from those being charged by the respective
assigning Lender prior to such assignment, then neither the Borrowers nor the
Subsidiary Swing Line Borrowers shall be obligated to pay such increased costs
(although the Borrowers and the Subsidiary Swing Line Borrowers shall be
obligated to pay any other increased costs of the type described above resulting
from changes after the date of the respective assignment).
(c) From and after the date that the Administrative Agent notifies
the assignor Lender that it has received (and provided its consent and, to the
extent required, received the consents of the Borrowers, the Swing Line Lenders
and the L/C Lender with respect to) an executed Assignment and Acceptance and
payment of the above-referenced processing fee, (i) the Assignee thereunder
shall be a party hereto and, to the extent that rights hereunder have been
assigned to it and obligations hereunder have been assumed by it pursuant to
such Assignment and Acceptance, shall have the rights and obligations of a
Lender under the Loan Documents, and (ii) the assignor Lender shall, to the
extent that rights and obligations hereunder and under the other Loan Documents
have been assigned by it pursuant to such Assignment and Acceptance, relinquish
its rights and be released from its obligations under the Loan Documents.
(d) Any Lender may at any time sell to one or more commercial banks
or other Persons not Affiliates of either Borrower (a "Participant")
participating interests in any Loan, the Commitment of such Lender and the other
interests of such Lender (the "originating Lender") hereunder and under the
other Loan Documents; provided, however, that (i) the originating Lender's
obligations under this Agreement shall remain unchanged, (ii) the originating
Lender shall remain solely responsible for the performance of such obligations,
(iii) the Borrowers, the Subsidiary Swing Line Borrowers, the Swing Line
Lenders, the L/C Lender, the Agent and the Administrative Agent shall continue
to deal solely and directly with
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the originating Lender in connection with the originating Lender's rights and
obligations under this Agreement and the other Loan Documents, and (iv) no
Lender shall transfer or grant any participating interest under which the
Participant has rights to approve any amendment to, or any consent or waiver
with respect to, this Agreement or any other Loan Document, except to the extent
such amendment, consent or waiver would (1) extend the final scheduled maturity
of any Loan, Note or Letter of Credit (unless such Letter of Credit is not
extended beyond the Termination Date) in which such Participant is
participating, or reduce the rate or extend the time of payment of interest or
fees thereon (except in connection with a waiver of applicability of any
post-default increase in interest rates) or reduce the principal amount thereof,
or increase the amount of the Participant's participation over the amount
thereof then in effect (it being understood that a waiver of any condition,
covenant, violation, Event of Default or Unmatured Event of Default shall not
constitute a change in the terms of such participation, and that an increase in
any Revolving Facility Commitment or Revolving Facility Loan shall be permitted
without the consent of any Participant if the Participant's participation is not
increased as a result thereof), (2) consent to the assignment or transfer by
either Borrower or any Subsidiary Swing Line Borrower of any of its rights and
obligations under this Agreement or (3) release all or substantially all of the
Collateral under all of the Security Documents (except as expressly provided in
the Loan Documents) supporting the Loans hereunder in which such Participant is
participating. In the case of any such participation, the Participant shall be
entitled to the benefit of Sections 2.15, 4.1, 4.3, 4.4, 4.6 and 11.4 as though
it were also a Lender hereunder (provided that the originating Lender and not
the Borrowers or any Subsidiary Swing Line Borrower shall be obligated to pay
any amount under Section 4.1, 4.3, 4.4 or 4.6 to any Participant which is
greater than a Borrower or Subsidiary Swing Line Borrower would have been
required to pay to the originating Lender if no such participation had been
sold), and if amounts outstanding under this Agreement are due and unpaid, or
shall have been declared or shall have become due and payable upon the
occurrence of an Event of Default, the Participant shall be deemed to have the
right of set-off in respect of its participating interest in amounts owing under
this Agreement to the same extent as if the amount of its participating interest
were owing directly to it as a Lender under this Agreement. Each originating
Lender shall indemnify and hold harmless the Borrowers and the Subsidiary Swing
Line Borrowers and each Agent from and against any taxes, penalties, interest
and other costs and losses (including Attorney Costs) incurred or payable by the
Borrowers or the Subsidiary Swing Line Borrowers or any Agent as a result of the
failure of the Borrower or the Subsidiary Swing Line Borrowers or any Agent to
comply with its obligations to deduct or withhold any Taxes from any payments
made pursuant to this Agreement to such Lender or any Agent, as the case may be,
which Taxes would not have been incurred or payable if such Participant had been
a Lender that had complied with the requirements of subsection 4.1(f).
(e) Notwithstanding any other provision in this Agreement, any
Lender may at any time create a security interest in, or pledge, all or any
portion of its rights under and
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interest in this Agreement and any Note held by it in favor of any Federal
Reserve Bank in accordance with Regulation A and any Operating Circular issued
by such Federal Reserve Bank. No such assignment shall release the assigning
Lender from its obligations hereunder.
(f) Each Borrower shall and shall cause each of its Subsidiaries to
assist any Lender in effectuating any assignment or participation pursuant to
this subsection 11.8(f) (including during syndication) in whatever manner such
Lender reasonably deems necessary, including the participation in meetings with
prospective Assignees.
11.9. Confidentiality. (a) Each of the Lenders agrees that it will
use its reasonable efforts not to disclose without the prior consent of the
Borrowers (other than to its employees, auditors, counsel or other professional
advisors, to Affiliates or to another Lender if the Lender or such Lender's
holding or parent company in its sole discretion determines that any such party
should have access to such information) any information with respect to the
Borrowers or any of their Subsidiaries which is furnished pursuant to this
Agreement; provided, however, that any Lender may disclose any such information
(i) as has become generally available to the public, (ii) as may be required or
appropriate in any report, statement or testimony submitted to any municipal,
state or Federal regulatory body having or claiming to have jurisdiction over
such Lender or to the Federal Reserve Board or the Federal Deposit Insurance
Corporation or the NAIC or similar organizations (whether in the United States
or elsewhere) or their successors, (iii) as may be required or appropriate in
response to any summons or subpoena or in connection with any litigation
(provided that, where practicable, the Borrowers shall be afforded prior notice
thereof and a reasonable opportunity to contest such summons or subpoena; it
being understood, however, that the Agents and Lenders shall be permitted in any
event to comply with such summons or subpoena), (iv) to comply with any law,
order, regulation or ruling applicable to such Lender, and (v) to any
prospective transferee in connection with any contemplated transfer of any of
the Notes or any interest therein by such Lender; provided, however, that the
transferring Lender shall use reasonable efforts to procure that such
prospective transferee (unless it is a Lender) executes an agreement with such
Lender containing provisions substantially identical to those contained in this
Section 11.9.
(b) Each of the Borrowers hereby acknowledges and agrees that each
Lender may share with any of its Affiliates any information related to the
Borrowers or any of their Subsidiaries (including, without limitation, any
nonpublic customer information regarding the creditworthiness of the Borrowers
and their Subsidiaries, provided that such Persons shall be subject to the
provisions of this Section 11.9 to the same extent as such Lender).
(c) Notwithstanding anything herein to the contrary, each of the
Borrowers hereby acknowledges and agrees that each Lender may share any
information with respect to the Borrowers or any of their Subsidiaries furnished
pursuant to this Agreement to any Person which
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shares or bears, whether directly or indirectly, such Lender's economic benefits
or burdens hereunder; provided, however, that such Person shall be subject to
the provisions of this Section 11.9 to the same extent as such Lender.
11.10. Set-off. In addition to any right or remedy of the Lenders
now or hereafter provided by law, and not by way of limitation of any such right
or remedy, during the continuance of an Event of Default such Lender is
authorized at any time and from time to time, without prior notice to the
Borrowers, any such notice being waived by the Borrowers to the fullest extent
permitted by law, to set off and to appropriate and apply any and all deposits
(general or special, time or demand, provisional or final) at any time held by,
and other indebtedness at any time owing by, such Lender (including by branches
and agencies of such Lender wherever located) to or for the credit or the
account of the applicable Borrower against such amount, irrespective of whether
or not any Administrative Agent or such Lender shall have made demand under this
Agreement or any Loan Document, including all interests in Obligations of such
Loan Party purchased by such Lender pursuant to Section 2.16, and all other
claims of any nature or description arising out of or connected with any Loan
Document, irrespective of whether or not such Lender shall have made any demand
hereunder and although said Obligations, liabilities or claims, or any of them,
shall be contingent or unmatured. Each Lender agrees promptly to notify the
applicable Borrower and the Administrative Agent after any such set-off and
application made by such Lender; provided, however, that the failure to give
such notice shall not affect the validity of such set-off and application.
11.11. Notification of Addresses, Lending Offices, etc. Each Lender
shall notify the Administrative Agent in writing of any change in the address to
which notices to such Lender should be directed, of addresses of any Lending
Office, of payment instructions in respect of all payments to be made to it
hereunder and of such other administrative information as the Administrative
Agent shall reasonably request.
11.12. Counterparts. This Agreement may be executed in any number of
separate counterparts, each of which, when so executed, shall be deemed an
original, and all of which taken together shall be deemed to constitute but one
and the same instrument. Any of the parties hereto may execute this Agreement by
signing any such counterpart.
11.13. Severability; Modification to Conform to Law. It is the
intention of the parties that this Agreement be enforceable to the fullest
extent permissible under applicable law, but that the unenforceability (or
modification to conform to such law) of any provision or provisions hereof shall
not render unenforceable, or impair, the remainder hereof. If any provision of
this Agreement shall be held invalid or unenforceable in whole or in part in any
jurisdiction, this Agreement shall, as to such jurisdiction, be deemed amended
to modify or delete, as necessary, the offending provision or provisions and to
alter the bounds thereof in
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order to render it or them valid and enforceable to the maximum extent permitted
by applicable law, without in any manner affecting the validity or
enforceability of such provision or provisions in any other jurisdiction or the
remaining provisions hereof in any jurisdiction.
11.14. No Third Parties Benefited. This Agreement is made and
entered into for the sole protection and legal benefit of the Borrowers, the
Lenders, the Agents and the Affiliates of the Agents, and their permitted
successors and assigns, and no other Person shall be a direct or indirect legal
beneficiary of, or have any direct or indirect cause of action or claim in
connection with, this Agreement or any other Loan Document.
11.15. Governing Law; Submission to Jurisdiction; Venue. (a) THIS
AGREEMENT AND THE OTHER LOAN DOCUMENTS AND THE RIGHTS AND OBLIGATIONS OF THE
PARTIES HEREUNDER AND THEREUNDER SHALL, EXCEPT AS OTHERWISE SET FORTH THEREIN,
BE CONSTRUED IN ACCORDANCE WITH AND BE GOVERNED BY THE LAW OF THE STATE OF NEW
YORK, WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAW THEREOF. Any legal action
or proceeding with respect to this Agreement or any other Loan Document may be
brought in the courts of the State of New York or of the United States for the
Southern District of New York and, by execution and delivery of this Agreement,
each Loan Party hereby irrevocably accepts for itself and in respect of its
property, generally and unconditionally, the jurisdiction of the aforesaid
courts. Each Loan Party hereby further irrevocably waives any claim that any
such courts lack jurisdiction over such Loan Party, and agrees not to plead or
claim, in any legal action or proceeding with respect to this Agreement or any
other Loan Document brought in any of the aforesaid courts, that any such court
lacks jurisdiction over such Loan Party. Each Loan Party irrevocably consents to
the service of process in any such action or proceeding by the mailing of copies
thereof by registered or certified mail, postage prepaid, to such Loan Party, at
its address for notices pursuant to Section 11.2, such service to become
effective 30 days after such mailing. Each Loan Party hereby irrevocably waives
any objection to such service of process and further irrevocably agrees not to
plead or claim in any action or proceeding commenced hereunder or under any
other Loan Document that service of process was in any way invalid or in
effective. Nothing herein shall affect the right of any Agent, any Lender or the
holder of any Note to serve process in any other manner permitted by law or to
commence legal proceedings or otherwise proceed against any Loan Party in any
other jurisdiction.
(b) Each Borrower on its own behalf and on behalf of each other Loan
Party hereby irrevocably waives any objection which it may now or hereafter have
to the laying of venue of any of the aforesaid proceedings arising out of or in
connection with this Agreement or any other Loan Document brought in the courts
referred to in clause (a) above and hereby further irrevocably waives and agrees
not to plead or claim in any such court that any such proceeding brought in any
such court has been brought in an inconvenient forum.
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11.16. Waiver of Jury Trial. Each of the parties to this Agreement
hereby irrevocably waives all right to a trial by jury in any proceeding or
counterclaim arising out of or relating to this Agreement, any other Loan
Document or any of the transactions contemplated hereby or thereby. In the event
of litigation, this Agreement may be filed as a written consent to a trial by
the court.
11.17. Judgment. If, for the purpose of obtaining judgment in any
court, it is necessary to convert a sum due hereunder or any other Loan Document
in one currency into another currency, the rate of exchange used shall be that
at which in accordance with normal banking procedures the Administrative Agent
could purchase the first currency with such other currency on the Business Day
preceding that on which final judgment is given. The obligation of each of the
Borrowers in respect of any such sum due from it to the Administrative Agent
hereunder or under any other Loan Document shall, notwithstanding any judgment
in a currency (the "Judgment Currency") other than that in which such sum is
denominated in accordance with the applicable provisions of this Agreement (the
"Agreement Currency"), be discharged only to the extent that on the Business Day
following receipt by the Administrative Agent of any sum adjudged to be so due
in the Judgment Currency, such Administrative Agent may in accordance with
normal banking procedures purchase the Agreement Currency with the Judgment
Currency. If the amount of the Agreement Currency so purchased is less than the
sum originally due to the Administrative Agent in the Agreement Currency, each
Borrower agrees, as a separate obligation and notwithstanding any such judgment,
to indemnify such Administrative Agent or the Person to whom such obligation was
owing against such loss. If the amount of the Agreement Currency so purchased is
greater than the sum originally due to the Administrative Agent in such
currency, such Administrative Agent agrees to return the amount of any excess to
the applicable Borrower (or to any other Person who may be entitled thereto
under applicable law).
11.18. Prior Understandings. This Agreement, together with the other
Loan Documents, embodies the entire agreement and understanding among the
Borrowers, the Lenders and the Agents, and supersedes all prior or
contemporaneous agreements and understandings of such Persons, verbal or
written, relating to the subject matter hereof and thereof, except that as
between the Loan Parties and the Arranger and the Administrative Agent the
following shall continue to remain in effect: (a) the Commitment Letter (other
than (A) the Term Sheet (as defined in the Commitment Letter) and (B) the
commitments of Merrill Lynch & Co. or Merrill Lynch Capital Corporation
thereunder) and (b) the Fee Letters.
11.19. Survival. The obligations of the Borrowers under Article IV
and Sections 11.4, 11.15 and 11.16 shall survive the repayment of the Loans and
other Obligations and the termination of the Commitments and, in the case of any
Lender that may assign any interest in its Commitments, Loans or Letter of
Credit interest hereunder, shall survive the making of such assignment,
notwithstanding that such assigning Lender may cease to be a "Lender" hereunder.
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11.20. CH Foreign Subsidiary Mortgages. Notwithstanding anything
else herein to the contrary, after the Closing Date, in order to reduce or
eliminate the potential imposition of withholding taxes, at CH Borrower's
request, the Administrative Agent shall permit Mortgages with respect to
Mortgaged Properties securing any Foreign Subsidiary Guarantee to be released
and to be replaced by Mortgages in favor of CH Borrower securing intercompany
indebtedness owed from the applicable Foreign Subsidiary Guarantor to CH
Borrower; provided, however, that (i) such intercompany indebtedness is pledged
by CH Borrower to secure its Obligations hereunder pursuant to the Securities
Pledge Agreement entered into by CH Borrower and the documents evidencing such
intercompany indebtedness and such Mortgages are delivered to the Administrative
Agent; (ii) the Administrative Agent receives opinions of counsel satisfactory
to the Administrative Agent with respect to the validity, binding effect and
enforceability of such mortgages and the perfection of the security interest
created by such mortgages, which opinions of counsel shall be substantially
equivalent in form and substance to the opinions of counsel delivered with
respect to the Mortgages being replaced; and (iii) all other matters relating to
such transactions shall be in form and substance reasonably satisfactory to the
Administrative Agent and its counsel and the Loan Parties shall take all action
and execute all such documents and instruments as are reasonably requested by
the Administrative Agent to provide for the security interest therein of the
Lenders. The Administrative Agent and the Lenders shall take all actions, at the
expense of the Borrowers, reasonably requested by the Borrowers to effect such
transactions.
[Signature Pages Follow]
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed and delivered by their proper and duly authorized officers as
of the day and year first above written.
MT ACQUISITION CORP. (to be merged
into Mettler-Toledo, Inc.), as a Borrower
By: /s/ Fred Ort
_______________________________________
Title:
METTLER-TOLEDO HOLDING AG,
as a Borrower
By: /s/ Fred Ort
_______________________________________
Title:
METTLER-TOLEDO HOLDING INC.,
as Guarantor
By: /s/ Fred Ort
_______________________________________
Title:
GARVENS AUTOMATION GmbH,
GIESEN, as a Subsidiary Swing Line
Borrower
By: /s/ Fred Ort
_______________________________________
Title:
<PAGE>
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METTLER-TOLEDO GmbH, GIESSEN,
as a Subsidiary Swing Line Borrower
By: /s/ Fred Ort
_______________________________________
Title:
METTLER-TOLEDO S.A., VIROFLAY,
as a Subsidiary Swing Line Borrower
By: /s/ Fred Ort
_______________________________________
Title:
METTLER-TOLEDO K.K., TAKARAZUKA,
as a Subsidiary Swing Line Borrower
By: /s/ Fred Ort
_______________________________________
Title:
METTLER-TOLEDO (ALBSTADT) GmbH,
ALBSTADT, as a Subsidiary Swing Line
Borrower
By: /s/ Fred Ort
_______________________________________
Title:
METTLER-TOLEDO AG, GREIFENSEE,
as a Subsidiary Swing Line Borrower
By: /s/ Fred Ort
_______________________________________
Title:
<PAGE>
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METTLER-TOLEDO LTD., LEICESTER,
as a Subsidiary Swing Line Borrower
By: /s/ Fred Ort
_______________________________________
Title:
<PAGE>
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MERRILL LYNCH & CO., as Arranger
and Documentation Agent
By: /s/ Christopher Birosak
_______________________________________
Title: Director
<PAGE>
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THE BANK OF NOVA SCOTIA,
as Administrative Agent
By: /s/ Todd Meller
_______________________________________
Title: Authorized Signatory
<PAGE>
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CREDIT SUISSE,
as Co-Agent
By: /s/ Joel Glodowski
_______________________________________
Title: Member of Senior Management
By: /s/ Andrea Tschopp
_______________________________________
ANDREA TSCHOPP ASSOCIATE
<PAGE>
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LEHMAN COMMERCIAL PAPER INC.,
as Co-Agent
By: /s/ Dennis J. Dee
_______________________________________
Title: Authorized Signatory
<PAGE>
LENDERS
ING CAPITAL ADVISORS, INC.,
as Agent for Bank Syndication Account,
as a Lender
By: /s/ Michael D. Hatley
_______________________________________
Name: Michael D. Hatley
Title: Vice President and Portfolio
Manager
Address for Notices:
333 S. Grand Avenue
Suite 400
Los Angeles, CA 90071
Attention: Michael D. Hatley
Telecopier No.: (213) 626-6552
Telephone No.: (213) 621-9062
<PAGE>
KZH HOLDING CORPORATION,
as a Lender
By: /s/ Robert Goodwin
_______________________________________
Name: Robert Goodwin
Title: Authorized Agent
Address for Notices:
CHASE MANHATTAN BANK
140 E. 45th Street
29th
New York, NY 10017
Attention: Joseph Nerich
Telecopier No.: 622-0136
Telephone No.: 622-0621
<PAGE>
THE NORTHWESTERN MUTUAL LIFE
INSURANCE COMPANY, as a Lender
By: /s/ John E. Schlifske
_______________________________________
Name: John E. Schlifske
Title: Vice President
Address for Notices:
720 E. Wisconsin Avenue
Milwaukee, WI 53202
Attention: John E. Schlifske
Telecopier No.: (414) 299-7124
Telephone No.: (414) 299-2454
<PAGE>
CRESCENT/MACH I PARTNERS, L.P.,
by: TCW Asset Management Company
its Investment Manager, as a Lender
By: /s/ Justin Driscoll
_______________________________________
Name: Justin Driscoll
Title: Vice President
Address for Notices:
TCW Asset Management Company
200 Park Avenue
Suite 2200
New York, N.Y. 10166-0228
Attention: Mark L. Gold
Telecopier No.: (212) 297-4159
Telephone No.: (212) 297-4000
With Copies to:
Crescent/Mach I Partners, L.P.
c/o State Street Bank & Trust Co.
Two International Place
Boston, MA 02110
Attention: Jackie Sweeney
Telecopier No.: (617) 664-5366
Telephone No.: (617) 664-5482
<PAGE>
TCW ASSET MANAGEMENT COMPANY
as Attorney-in-Fact for Integon
Life Insurance Corporation, as
a Lender
By: /s/ Justin Driscoll
_______________________________________
Name: Justin Driscoll
Title: Vice President
Address for Notices:
Conning & Company
City Place II
185 Asylum Street
Hartford, Connecticut 06103
Attention: Laurie Ereshena
Telecopier No.: (860) 520-1202
Telephone No.: (860) 520-1206
With Copies To:
TCW Asset Management Company
200 Park Avenue
Suite 2200
New York, NY 10166-0228
Attention: Mark L. Gold
Justin Driscoll
Telecopier No.: (212) 297-4159
Telephone No.: (212) 297-4000
<PAGE>
TCW ASSET MANAGEMENT COMPANY
as Attorney-in-Fact for United Companies
Life Insurance Company, as a Lender
By: /s/ Justin Driscoll
_______________________________________
Name: Justin Driscoll
Title: Vice President
Address for Notices:
United Companies Life Insurance
Company
8545 United Plaza Blvd.
Baton Rouge, LA 70809
Attention: Andrew Davidson
Vicky Read
Telecopier No.: (504) 922-4214
Telephone No.: (504) 924-6007
ext. 2327
AND
Arthur Evans
PennCorp Financial, Inc.
Telecopier No.: (212) 297-4159
Telephone No.: (212) 297-4000
With Copies To:
TCW Asset Management Company
200 Park Avenue
Suite 2200
New York, NY 10166-0228
Telecopier No.: (212) 297-4159
Telephone No.: (212) 297-4000
<PAGE>
VAN KAMPEN AMERICAN CAPITAL
PRIME RATE INCOME TRUST,
as a Lender
By: /s/ Brian W. Good
_______________________________________
Name: Brian W. Good
Title: Vice President
Address for Notices:
One Parkview Plaza
Oakbrook Terrace, IL 60181
Attention: Jeffrey W. Maillet
Telecopier No.: (630) 684-6740
Telephone No.: (630) 684-6438
<PAGE>
PRIME INCOME TRUST,
as a Lender
By: /s/ Rafael Scolari
_______________________________________
Name:
Title:
Address for Notices:
2 World Trade Center
72nd Floor
New York, NY 10048
Attention: Rafael Scolari
Telecopier No.: (212) 392-5345
Telephone No.: (212) 392-5686
<PAGE>
PROTECTIVE LIFE INSURANCE
COMPANY, as a Lender
By: /s/ Mark K. Okada
_______________________________________
Name: Mark K. Okada, CFA
Title: Executive Vice President,
Protective Asset
Management, L.L.C.
Address for Notices:
13455 Noel Road
Suite 1150
Dallas, TX 75240
Attention: T.J. Juffer
Telecopier No.: (972) 233-4343, 6143
Telephone No.: (972) 233-3939
<PAGE>
NEW YORK LIFE INSURANCE
COMPANY, as a Lender
By: /s/ Steven M. Benevento
_______________________________________
Name: Steven M. Benevento
Title: Assistant Vice President
Address for Notices:
51 Madison Avenue
New York, NY 10010
Attention: Investment Department
Private Finance Group
Room 206
Telecopier No.: (212) 576-6752
Telephone No.: (212) 576-7238 or
(212) 576-7699
With a copy of any notice to:
51 Madison Avenue
New York, NY 10010
Attention: Office of General Counsel
Investment Section
Room 1104
Telecopier No.: (212) 576-8340
<PAGE>
OAK HILL SECURITIES FUND, L.P.,
as a Lender
By: Oak Hill Securities GenPar, L.P.,
its General Partner
By: Oak Hill Securities MGP, Inc.,
its General Partner
By: /s/ Scott Krase
_______________________________________
Name: Scott Krase
Title: Vice President
Address for Notices:
c/o Oak Hill Partners, Inc.
65 East 55th Street
32nd Floor
New York, NY 10022
Attention: Scott Krase
Telecopier No.: (212) 593-3596
Telephone No.: (212) 326-1551
<PAGE>
CHL HIGH YIELD LOAN PORTFOLIO,
a unit of Chase Manhattan Bank,
as a Lender
By: /s/ Joyce C. Delucca
_______________________________________
Name: Joyce C. DeLucca
Title: Vice President
Address for Notices:
380 Madison Avenue
12th Floor
New York, NY 10017
Attention: Joyce C. DeLucca
Telecopier No.: (212) 622-3797
Telephone No.: (212) 622-3104
<PAGE>
PILGRIM AMERICA PRIME RATE
TRUST, as a Lender
By: /s/ Michael J. Bacevich
_______________________________________
Name: Michael J. Bacevich
Title: Vice President
Address for Notices:
Two Renaissance Square
40 North Central Avenue
Suite 1200
Phoenix, AZ 85004-3444
Attention: Robert Clouse
Telecopier No.: (602) 417-8321
Telephone No.: (602) 417-8268
AND
Address for Notices:
State Street Bank and Trust Company
Alternative Structures Unit
Two International Place
5th Floor
Boston, MA 02110
Attention: Debbie Jessee
Ref.: Pilgrim America Prime Rate
Trust
Telecopier No.: (617) 664-5366, 5367,
5368
<PAGE>
THE FIRST NATIONAL BANK OF
BOSTON, as a Lender
By: /s/ Diane J. Exeter
_______________________________________
Name: Diane J. Exeter
Title: Director
Address for Notices:
Mail Stop 01-08-05
100 Federal Street
Boston, MA 02110
Attention: Diane J. Exeter
Telecopier No.: (617) 434-4929
Telephone No.: (617) 434-1442
<PAGE>
THE BANK OF NOVA SCOTIA,
as a Lender
By: /s/ Todd Meller
_______________________________________
Name: Todd Meller
Title: Authorized Signatory
Address for Notices:
(Administrative) (US$)
One Liberty Plaza
26th Floor
New York, NY 10006
Attention: Tilsa Cora
Loan Administration
Group
Telecopier No.: (212) 225-5145
Telephone No.: (212) 225-5044
Address for Notices:
(Administrative) (Non-US$)
Scotia House - 33 Finsbury Square
London EC2A 1BB England
Attention: Rick Bastiani
Telecopier No.: (44-171) 638-8488
Telephone No.: (44-171) 826-5625
Address for Notices:
(Credit)
One Liberty Plaza
26th Floor
New York, NY 10006
Attention: Todd Meller
Telecopier No.: (212) 225-5090
Telephone No.: (212) 225-5096
<PAGE>
BANQUE FRANCAISE du COMMERCE
EXTERIEUR, as a Lender
By: /s/ Peter Karl Harris
_______________________________________
Name: Peter Karl Harris
Title: Vice President
By: /s/ William C. Maier
_______________________________________
Name: William C. Maier
Title: VP-Group Member
Address for Notices:
645 Fifth Avenue
New York, NY 10022
Attention: William C. Maier
Telecopier No.: (212) 872-5045
Telephone No.: (212) 872-5050
<PAGE>
BANQUE PARIBAS,
as a Lender
By: /s/ John J. McCormick, III
_______________________________________
Name: John J. McCormick, III
Title: Vice President
By: /s/ Ann C. Pifer
_______________________________________
Name: Ann C. Pifer
Title: Vice President
Address for Notices:
787 Seventh Avenue
New York, NY 10019
Attention: Mary T. Finnegan
Telecopier No.: (212) 841-2333
Telephone No.: (212) 841-2551
<PAGE>
COMPAGNIE FINANCIERE DE CIC ET
DE L'UNION EUROPEENNE,
as a Lender
By: /s/ Sean Mounier, /s/ Brian O'Leary
_______________________________________
Name: Sean Mounier, Brian O'Leary
Title: First Vice President, Vice
President
Address for Notices:
520 Madison Avenue
37th Floor
New York, NY 10022
Attention: Sean Mounier
Telecopier No.: (212) 715-4535
Telephone No.: (212) 715-4413
<PAGE>
CAISSE NATIONALE DE CREDIT
AGRICOLE, as a Lender
By: /s/ Dean Balice
_______________________________________
Name: Dean Balice
Title: Senior Vice President
Address for Notices:
55 E. Monroe Street
Suite 4700
Chicago, IL 60603
Attention: William Jeffers
Telecopier No.: (312) 372-3724
Telephone No.: (312) 917-7412
<PAGE>
CREDIT SUISSE,
as a Lender
By: /s/ Joel Glodowski
_______________________________________
Name: Joel Glodowski
Title: Member of Senior
Management
By: /s/ Andreas Tschopp
_______________________________________
Name: Andreas Tschopp
Title: Associate
Address for Notices:
Credit Suisse New York
Tower 49
12 East 49th Street
New York, NY 10017
Attention: Joel Glodowski
Telecopier No.: (212) 238-5441
Telephone No.: (212) 238-5470
<PAGE>
CREDITANSTALT CORPORATE
FINANCE, INC., as a Lender
By: /s/ Christina T. Schoen
_______________________________________
Name: Christina T. Schoen
Title: Vice President
By: /s/ Richard P. Buckanavage
_______________________________________
Name: Richard P. Buckanavage
Title: Vice President
Address for Notices:
2 Greenwhich Plaza
Greenwich, CT 06830
Attention: Maura K. Connor
Telecopier No.: (203) 861-6594
Telephone No.: (203) 861-6432
<PAGE>
CRESTAR BANK,
as a Lender
By: /s/ Linda L. Bergmann
_______________________________________
Name: Linda L. Bergmann
Title: Vice President
Address for Notices:
919 East Main Street
Richmond, VA 23219
Attention: Linda L. Bergmann
Corporate Division
22nd Floor
Telecopier No.: (804) 782-5413
Telephone No.: (804) 782-7806
<PAGE>
DG BANK DEUTSCHE
GENOSSENSCHAFTSBANK, as a
Lender
By: /s/ Norah McCann
_______________________________________
Name: Norah McCann
Title: SVP
By: /s/ Karen A. Brinkman
_______________________________________
Name: Karen A. Brinkman
Title: Vice President
Address for Notices:
609 Fifth Avenue
8th Floor
New York, NY 10017
Attention: Trevor H. Brookes
Telecopier No.: (212) 745-1556
Telephone No.: (212) 745-1564
<PAGE>
THE FUJI BANK, LIMITED,
as a Lender
By: /s/ Peter L. Chinnici
_______________________________________
Name: Peter L. Chinnici
Title: Joint General Manager
Address for Notices:
225 West Wacker Drive
Suite 2000
Chicago, IL 60606
Attention: James R. Fayen
Telecopier No.: (312) 621-0539
(312) 419-3677
Telephone No.: (312) 621-0397
<PAGE>
LEHMAN COMMERCIAL PAPER INC.,
as a Lender
By: /s/ Dennis J. Dee
_______________________________________
Name: Dennis J. Dee
Title: Authorized Signatory
Address for Notices:
Three World Financial Center
10th Floor
New York, NY 10285-0800
Attention: Michelle Swanson
Telecopier No.: (212) 528-0819
Telephone No.: (212) 526-0330
<PAGE>
THE LONG-TERM CREDIT BANK OF
JAPAN, LIMITED, NEW YORK
BRANCH, as a Lender
By: /s/ Takashi Fukuzaki
_______________________________________
Name: Takashi Fukuzaki
Title: Vice President
Address for Notices:
165 Broadway
New York, NY 10006
Attention: Takashi Fukuzaki
Telecopier No.: (212) 608-2371
Telephone No.: (212) 335-4486
<PAGE>
MERRILL LYNCH CAPITAL
CORPORATION,
as a Lender
By: /s/ Christopher Birosak
_______________________________________
Name: Christopher Birosak
Title: Vice President
Address for Notices:
Merrill Lynch & Co
World Financial Center
South Tower - 14th Floor
New York, NY 10081-6114
Attention: Chris Reilly
Telecopier No.: (212) 236-7584
Telephone No.: (212) 236-7579
<PAGE>
MERITA BANK LTD,
as a Lender
By: /s/ Frank Maffet
_______________________________________
Name: Frank Maffet
Title: Vice President
By: /s/ John F. Kehnle
_______________________________________
Name: John F. Kehnle
Title: Vice President
Address for Notices:
437 Madison Avenue
New York, NY 10022
Attention: Frank Maffei
Telecopier No.: (212) 318-9318
Telephone No.: (212) 318-9561
<PAGE>
PNC BANK NATIONAL
ASSOCIATION, as a Lender
By: /s/ Mark J. Williams
_______________________________________
Name: Mark J. Williams
Title: Vice President
Address for Notices:
345 Park Avenue
29th Floor
New York, NY 10154
Attention: Mark J. Williams
Telecopier No.: (212) 409-3737
Telephone No.: (212) 409-3724
<PAGE>
SOCIETE GENERALE,
as a Lender
By: /s/ John J. Wagner
_______________________________________
Name: John J. Wagner
Title: Vice President
Address for Notices:
1221 Avenue of the Americas
New York, NY 10020
Attention: John J. Wagner
(Credit Matters)
Telecopier No.: (212) 278-6178
Telephone No.: (212) 278-6736
Attention: Ricky Tretola
(Administrative Matters)
Telephone No.: (212) 278-6732
<PAGE>
THE HUNTINGTON NATIONAL
BANK, as a Lender
By: /s/ Chris Spence
_______________________________________
Name: Chris Spence
Title: Commercial Loan Officer
Address for Notices:
Huntington Center
HC-0810
41 South High Street
Columbus, OH 43287
Attention: Chris Spence
Telecopier No.: (614) 480-5791
Telephone No.: (614) 480-3129
<PAGE>
THE INDUSTRIAL BANK OF JAPAN,
LIMITED, as a Lender
By: /s/ Junri Oda
_______________________________________
Name: Junri Oda
Title: Senior Vice President &
Senior Manager
Address for Notices:
245 Park Avenue
New York, NY 10167
Attention: Mikihide Katsumata
Telecopier No.: (212) 682-2870
Telephone No.: (212) 309-6452
<PAGE>
THE MITSUBISHI TRUST & BANKING
CORP., as a Lender
By: /s/ Hachiro Hosoda
_______________________________________
Name: Hachiro Hosoda
Title: Senior Vice President
Address for Notices:
520 Madison Avenue
26th Floor
New York, NY 10022
Attention: Beatrice Kossodo
Telecopier No.: (212) 644-6825
Telephone No.: (212) 891-8363
<PAGE>
UNION BANK OF SWITZERLAND,
ZURICH,
as Lender for Tranche A
By: /s/ Simon Clarkson Webb
_______________________________________
Name: Simon Clarkson Webb
Title: Vice President
By: /s/ Mark P. Mottet
_______________________________________
Name: Mark P. Mottet
Title: Vice President
Address for Notices:
UBS
Bahnhofstrasse 45
CH-8021 Zurich
Switzerland
Attention: Dr. W. Schwartzkopff
Telecopier No.: 41-1-234-6475
Telephone No.: 41-1-234-5614
<PAGE>
UNION DES BANQUES SUISSES
(Luxembourg) S.A.,
as Lender of the Revolving Facility
By: /s/ Simon Clarkson Webb
_______________________________________
Name: Simon Clarkson Webb
Title: Vice President
Address for Notices:
UBS
Bahnhofstrasse 45
CH-8021 Zurich
Switzerland
Attention: Dr. W. Schwartzkopff
Telecopier No.: 41-1-234-6475
Telephone No.: 41-1-234-5614
<PAGE>
UNITED OF OMAHA LIFE
INSURANCE COMPANY, as a Lender
By: /s/ Edwin H. Garrison Jr.
_______________________________________
Name: Edwin H. Garrison Jr.
Title: First Vice President
Address for Notices:
Mutual of Omaha Plaza
Omaha, NE 68175-1011
Attention: Edward H. Garrison, Jr.
Telecopier No.: (402) 351-2913
Telephone No.: (402) 351-2504
<PAGE>
KEYPORT LIFE INSURANCE
COMPANY, as a Lender
By: /s/ Jefferey J. Lobo
_______________________________________
Name: Jefferey J. Lobo
Title: Vice President
Address for Notices:
125 High Street
Boston, MA 02110
Attention: Daniel T.H. Yin
Telecopier No.: (617) 526-1769
Telephone No.: (617) 526-1709
<PAGE>
EATON VANCE MANAGEMENT INC.,
as a Lender
By:
_______________________________________
Name:
Title:
Address for Notices:
Attention:
Telecopier No.:
Telephone No.:
<PAGE>
BANQUE INDOSUEZ, New York branch,
as a Lender
By: /s/ Andrew N. Marshak
_______________________________________
Name: Andrew N. Marshak
Title: Vice President
By: /s/ John L. Sabre
_______________________________________
Name: John L. Sabre
Title: First Vice President
Address for Notices:
1211 Avenue of the Americas
New York, New York 10036
Attention: Andrew Marshak
Telecopier No.: (212) 278-2254
Telephone No.: (212) 278-2232
<PAGE>
ANNEX A
The Bank of Nova Scotia Administrative Details:
For payment of principal, fees, or interest paid in the following currencies to
The Bank of Nova Scotia, please credit our accounts:
U.S. Dollar Denominated: at the Federal Reserve Bank of New York,
ABA# 026002532
For further credit to The Bank of Nova Scotia,
New York Agency, Account # 06083-35,
Attention: Special Management Account,
Reference: Mettler Toledo
French Franc Denominated: Banque Francaise Du Commerce Exteriuer
For further credit to The Bank of Nova Scotia
London, Reference: Mettler Toledo
Paris, France
Swift Code: BFCEFRPP
Pounds Sterling Denominated: The Bank of Nova Scotia London
For further credit to The Bank of Nova Scotia
London, Reference: Mettler Toledo
33 Finsbury Square, London EC2A 1B8
Chaps 301661
Swift Code: LOYD GB 2L
Japanese Yen Dominated: Tokyo, Japan
For further credit to The Bank of Nova Scotia
London, Reference: Mettler Toledo
Swift Code: NOSCJPJT
Deutsche Mark Denominated: Deutsche Bank AG
For further credit to The Bank of Nova Scotia
London, Reference: Mettler Toledo
Frankfurt, Germany
Swift Code: DEUTDEFF
Swiss Franc Denominated: Swiss Bank Corp.
For further credit to The Bank of Nova Scotia
London, Reference: Mettler Toledo
Zurich, Switzerland
Swift Code: SBCOCHZZ80A
U.S. Account
Administrator:
- -------------
The Bank of Nova Scotia Tilsa Cora
One Liberty Plaza, 26th Floor Tel: (212) 225-5044
New York, NY 10006 Fax: (212) 225-5145
CH Account
Administrator:
- -------------
Scotiabank (U.K.) Ltd. Rick Bastiani
Scotia House
33 Finsbury Square Tel: (44-171) 826-5625
London, EC2A 1B8 Fax: (44-171) 638-8488
Primary Secondary
Credit Contact: Credit Contact:
-------------- --------------
The Bank of Nova Scotia Todd S. Meller Jerome Noto
One Liberty Plaza, 26th Floor Tel: (212) 225-5096 Tel: (212) 225-5146
New York, NY 10006 Fax: (212) 225-5090 Fax: (212) 225-5090
<PAGE>
EXHIBIT 99.2
<PAGE>
UNAUDITED PRO FORMA FINANCIAL INFORMATION
The following unaudited pro forma financial statements of the Company have
been prepared to give effect to the Acquisition, including the Offering. The
accompanying Unaudited Pro Forma Balance Sheet at June 30, 1996 has been
prepared as if the Acquisition was consummated as of that date. The accompanying
Unaudited Pro Forma Statements of Operations of the Company for the year ended
December 31, 1995 and the six months ended June 30, 1995 and 1996 give effect to
the Acquisition as if it occurred at January 1, 1995.
The pro forma adjustments are based upon available information and certain
assumptions that the Company believes are reasonable under the circumstances.
Pro forma adjustments are applied to the historical financial statements of the
Mettler-Toledo Group to account for the Acquisition under the purchase method of
accounting. Under purchase accounting, the estimated Acquisition cost will be
allocated to the Mettler-Toledo Group's assets and liabilities based on their
relative fair values. Allocations are subject to valuations as of the date of
the Acquisition based on appraisals and other studies which are not yet
completed. Accordingly, the final allocations may differ from the amounts
reflected herein.
The Company is evaluating its business strategy as an independent company
after the Acquisition and believes that it can support continued sales growth
while further reducing its overall cost base. In July 1996, in anticipation of
the consummation of the Acquisition, the Company announced the closure of its
Westerville, Ohio facility. In addition, the Company will implement a targeted
workforce reduction by the end of 1996. The Unaudited Pro Forma Statements of
Operations reflect a pro forma adjustment of $8.3 million per year reflecting
the cost savings the Company expects to realize from these projects. See Note
(A) to the Unaudited Pro Forma Statements of Operations. A reserve of $9.0
million is reflected on the Unaudited Pro Forma Balance Sheet to reflect the
estimated costs of implementing these projects. See Note 2(F) to the Unaudited
Pro Forma Balance Sheet. Of such reserve of $9.0 million, the costs associated
with the closure of the Westerville facility of $2.0 million were recorded as a
charge in the quarter ended September 30, 1996.
In accordance with U.S. GAAP, the Company will allocate a portion of the
estimated Acquisition cost to (i) in-process research and development projects
that have economic value (currently estimated to be $120.4 million) and (ii) the
revaluation of inventories (currently estimated to be $21.1 million). In the
case of in-process research and development, the amount allocated will be
charged to expense as of the date of the Acquisition. In the case of
inventories, the revaluation amount will be charged to cost of sales over the
period in which such inventories are sold, which is expected to be one to two
quarters following the Closing. These one-time charges have not been reflected
in the accompanying Unaudited Pro Forma Statements of Operations due to their
unusual, non-recurring nature.
The pro forma financial statements have been prepared based upon the
Audited Combined Financial Statements and the Interim Financial Statements of
the Mettler-Toledo Group, included elsewhere herein, which have been prepared in
accordance with U.S. GAAP. The pro forma financial statements should be read in
conjunction with the Audited Combined Financial Statements, the Interim
Financial Statements, 'Management's Discussion and Analysis of Financial
Condition and Results of Operations' and other financial information included
elsewhere in this Prospectus. These unaudited pro forma financial statements and
related notes are provided for informational purposes only and do not purport to
be indicative of the results which would have actually been obtained had the
Acquisition and other events been completed on the dates indicated or which may
be expected to occur in the future. The Mettler-Toledo Group's historical net
income and cash flows as a wholly owned operation of Ciba are not necessarily
indicative of the net income and cash flows it might have realized as an
independent entity. See 'Management's Discussion and Analysis of Financial
Condition and Results of Operations--Effect of Acquisition on Results of
Operations.'
23
<PAGE>
METTLER-TOLEDO, INC.
UNAUDITED PRO FORMA BALANCE SHEET
<TABLE>
<CAPTION>
AS OF JUNE 30, 1996
------------------------------------------------------
METTLER-TOLEDO
METTLER-TOLEDO PRO FORMA INC.
GROUP HISTORICAL ADJUSTMENTS PRO FORMA
---------------- -------------- --------------
(IN THOUSANDS)
<S> <C> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents...................... $ 45,935 $(40,935)(1) $ 5,000
Due from Ciba and affiliates................... 53,025 (53,025)(2)(A) --
Trade accounts receivable, net................. 157,212 157,212
Inventories.................................... 107,342 21,100(2)(B) 128,442
Deferred taxes................................. 5,836 5,836
Other current assets........................... 25,040 25,040
---------------- -------------- --------------
Total current assets........................ 394,390 (72,860) 321,530
Property, plant and equipment, net............... 225,885 52,500(2)(C) 278,385
Goodwill and other intangible assets, net........ 83,155 94,250(2)(D) 177,405
Long-term deferred taxes......................... 13,596 13,596
Debt issuance costs.............................. -- 14,013(2)(E) 14,013
Other assets..................................... 14,894 14,894
---------------- -------------- --------------
Total assets................................ $731,920 $ 87,903 $819,823
---------------- -------------- --------------
---------------- -------------- --------------
LIABILITIES AND STOCKHOLDER'S EQUITY/NET ASSETS
Current liabilities:
Trade accounts payable......................... $ 34,265 $ 34,265
Accrued and other liabilities.................. 101,782 $ 9,000(2)(F) 110,782
Taxes payable.................................. 16,439 16,439
Deferred taxes................................. 7,313 6,330(2)(G) 13,643
Bank and other loans........................... 32,610 (32,610)(2)(H) --
Notes payable to Ciba and affiliates........... 83,242 (83,242)(2)(A) --
Short-term portion of term loans............... -- 9,000(1) 9,000
---------------- -------------- --------------
Total current liabilities................... 275,651 (91,522) 184,129
Long-term debt payable to Ciba and affiliates.... 152,231 (152,231)(2)(A) --
Long-term debt due to third parties.............. 6,015 (6,015)(2)(H) --
Long-term deferred taxes......................... 12,827 14,104(2)(G) 26,931
Credit Agreement:
Term loans..................................... -- 246,000(1) 246,000
Revolving credit facility...................... -- 55,829(1) 55,829
Notes............................................ -- 135,000(1) 135,000
Other long-term liabilities...................... 88,979 10,500(2)(I) 99,479
---------------- -------------- --------------
Total liabilities........................... 535,703 211,665 747,368
Minority interest................................ 2,855 2,855
Stockholder's equity/net assets:
Net assets..................................... 193,362 (193,362)(2) --
Common stock................................... -- 190,000(1) 190,000
Accumulated deficit............................ -- (120,400)(2)(J) (120,400)
---------------- -------------- --------------
Total stockholder's equity/net assets....... 193,362 (123,762) 69,600
---------------- -------------- --------------
Total liabilities and stockholder's
equity/net assets......................... $731,920 $ 87,903 $819,823
---------------- -------------- --------------
---------------- -------------- --------------
</TABLE>
24
<PAGE>
METTLER-TOLEDO, INC.
NOTES TO UNAUDITED PRO FORMA BALANCE SHEET
JUNE 30, 1996
(IN THOUSANDS)
(1) For a description of the sources and uses of funds for the Acquisition, see
'Use of Proceeds.' The amount of all debt due to Ciba and affiliates, net of
amounts due from Ciba and affiliates, will be settled at Closing. The Company
also expects to repay all existing bank and other loans at Closing. The
Unaudited Pro Forma Balance Sheet assumes receipt at Closing of the $7,500
equity contribution that may be made after Closing, as described under 'Use of
Proceeds.'
(2) Under purchase accounting, the total estimated Acquisition cost will be
allocated to the Company's assets and liabilities based on their relative fair
values. Allocations are subject to valuations as of the date of the Acquisition
based on appraisals and other studies which are not yet completed. Accordingly,
the final allocations may be different from the amounts reflected herein. The
amount and the components of the estimated Acquisition cost, along with the
estimate of the allocation of the purchase price to assets acquired and
liabilities assumed is as follows:
<TABLE>
<S> <C>
Estimated Acquisition price, including debt...................... $ 642,764
Acquisition and financing costs.................................. 34,000
----------
Total estimated Acquisition price, including debt........... $ 676,764
----------
----------
Historical net book value at June 30, 1996....................... $ 193,362
Repayment of net amounts owed to Ciba and affiliates:
Due from Ciba and affiliates................................... (53,025)(A)
Notes payable to Ciba and affiliates........................... 83,242(A)
Long-term debt payable to Ciba and affiliates.................. 152,231(A)
Estimated revaluation of inventories............................. 21,100(B)
Estimated revaluation of property, plant and equipment........... 52,500(C)
Goodwill and other intangible assets, net........................ 94,250(D)
Capitalized debt issuance related expenses....................... 14,013(E)
Estimated restructuring reserve.................................. (9,000)(F)
Net deferred tax effects of certain of the purchase accounting
adjustments:
Current..................................................... (6,330)(G)
Long-term................................................... (14,104)(G)
Repayment of bank and other loans................................ 32,610(H)
Long-term debt due to third parties.............................. 6,015(H)
Record pension and post-retirement obligations at projected
benefit obligation
and accumulated benefit obligation, respectively............... (10,500)(I)
Estimated in-process research and development valuation.......... 120,400(J)
----------
$ 676,764
----------
----------
</TABLE>
(A) As indicated in Note 1 above, the net amount of all debt due to Ciba
and affiliates will be settled at Closing.
(B) The Company will revalue certain inventories in connection with the
purchase price allocation. This revaluation will be charged to cost of sales in
the period in which the inventories are sold, which is expected to be one to two
quarters after Closing. This one-time charge is reflected in the Unaudited Pro
Forma Balance Sheet but not in the accompanying Unaudited Pro Forma Statements
of Operations due to its unusual, non-recurring nature.
(C) Represents the estimated revaluation of acquired real estate,
principally land holdings in Switzerland contiguous to certain of the Company's
manufacturing facilities.
25
<PAGE>
(D) Represents the excess purchase price resulting from the Acquisition,
which includes value that will ultimately be attributed to patents and other
intangible assets, other acquired assets, and goodwill once the Company's asset
appraisals and other valuation studies are completed. Such asset appraisals and
valuation studies are anticipated to be completed shortly after completion of
the Acquisition. As such asset appraisals and valuation studies have not yet
been completed, for purposes of the accompanying pro forma presentation, the
excess purchase price has been included in Goodwill and other intangible assets,
net in the Unaudited Pro Forma Balance Sheet and is being amortized over an
estimated composite amortizable life of 30 years in the Unaudited Pro Forma
Statements of Operations. The Company presently estimates that upon completion
of the asset appraisals and valuation studies, approximately $20 million of such
excess purchase price may be allocated to patents and amortized over a useful
life of five years and approximately $40 million may be allocated to trademarks
and amortized over a useful life of 12 to 13 years, while the remaining
approximately $117 million would represent goodwill and be amortized over a
useful life of 40 years. Final allocation of the excess purchase price between
intangible assets and goodwill will have no material effect on the Company's
balance sheet but may affect the estimated composite amortizable life of such
intangible assets and goodwill and, accordingly, the amount of amortization
expense.
(E) Represents expenses relating to the issuance of the loans under the
Credit Agreement and the issuance of the Notes.
(F) Represents a reserve for costs associated with the closure of the
Company's Westerville, Ohio facility, which was announced in July 1996, and a
targeted workforce reduction to be implemented by the end of 1996.
(G) Represents the net deferred tax liability (both current and long-term)
relating to certain of the purchase price adjustments for which there will be no
change in underlying tax bases of the affected assets and liabilities.
(H) At Closing, the Company expects to repay all existing bank and other
loans and long-term debt to third parties. However, the Company may determine to
leave in place certain third party indebtedness following the Closing and reduce
the borrowings at Closing under the revolving credit facility.
(I) Represents the recording of the pension liability at the projected
benefit obligation, net of plan assets (funded status) level and the
post-retirement liability at the accumulated benefit obligation level.
(J) In accordance with U.S. GAAP, the Company will allocate a portion of
the purchase price to in-process research and development projects that have
economic value and immediately write-off this value as a charge to operations
upon consummation of the Acquisition. This one-time charge is reflected in the
Unaudited Pro Forma Balance Sheet but not in the Unaudited Pro Forma Statements
of Operations due to its unusual, non-recurring nature.
26
<PAGE>
METTLER-TOLEDO, INC.
UNAUDITED PRO FORMA STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
FOR THE YEAR ENDED DECEMBER 31, 1995
-------------------------------------------------------
METTLER-TOLEDO,
METTLER-TOLEDO PRO FORMA INC.
GROUP HISTORICAL ADJUSTMENTS PRO FORMA
---------------- -------------- ---------------
(IN THOUSANDS)
<S> <C> <C> <C>
Net sales.......................... $850,415 $ 850,415
Cost of sales...................... 508,089 $ (2,600)(A) 505,489
---------------- -------------- ---------------
Gross profit..................... 342,326 2,600 344,926
Research and development
expenses......................... 54,542 (1,200)(A) 53,342
Marketing and selling expenses..... 167,396 (2,500)(A) 164,896
General and administrative
expenses......................... 81,167 2,300(B) 81,467
(2,000)(A)
Amortization of goodwill and other
intangible assets................ 2,529 3,385(C) 5,914
Other charges (income), net........ (701) (701)
---------------- -------------- ---------------
Income from operations........... 37,393 2,615 40,008
Interest expense................... 18,219 17,668(D) 38,270
2,383(E)
Financial income, net.............. 8,630 (5,388)(F) 3,242
---------------- -------------- ---------------
Income before taxes and minority
interest...................... 27,804 (22,824) 4,980
Provision for taxes................ 8,782 (4,218)(G) 4,564
Minority interest.................. 768 768
---------------- -------------- ---------------
Net income (loss).................. $ 18,254 $(18,606) $ (352)
---------------- -------------- ---------------
---------------- -------------- ---------------
</TABLE>
See accompanying notes to Unaudited Pro Forma Statements of Operations.
27
<PAGE>
METTLER-TOLEDO, INC.
UNAUDITED PRO FORMA STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
FOR THE SIX MONTHS ENDED JUNE 30, 1995
-----------------------------------------------------
METTLER-TOLEDO,
METTLER-TOLEDO PRO FORMA INC.
GROUP HISTORICAL ADJUSTMENTS PRO FORMA
---------------- -------------- ---------------
(IN THOUSANDS)
<S> <C> <C> <C>
Net sales..................... $406,992 $ 406,992
Cost of sales................. 243,643 $ (1,300)(A) 242,343
---------------- -------------- ---------------
Gross profit................ 163,349 1,300 164,649
Research and development
expenses.................... 27,005 (600)(A) 26,405
Marketing and selling
expenses.................... 80,965 (1,250)(A) 79,715
General and administrative
expenses.................... 37,909 1,150(B) 38,059
Amortization of goodwill and (1,000)(A)
other intangible assets..... 1,289 1,668(C) 2,957
---------------- -------------- ---------------
Income from operations...... 16,181 1,332 17,513
Interest expense.............. 8,717 9,226(D) 19,135
1,192(E)
Financial income, net......... 2,403 (2,110)(F) 293
---------------- -------------- ---------------
Income (loss) before taxes
and minority interest.... 9,867 (11,196) (1,329)
Provision (benefit) for
taxes....................... 3,117 (1,722)(G) 1,395
Minority interest............. 270 270
---------------- -------------- ---------------
Net income (loss)............. $ 6,480 $ (9,474) $ (2,994)
---------------- -------------- ---------------
---------------- -------------- ---------------
</TABLE>
See accompanying notes to Unaudited Pro Forma Statements of Operations.
28
<PAGE>
METTLER-TOLEDO, INC.
UNAUDITED PRO FORMA STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
FOR THE SIX MONTHS ENDED JUNE 30, 1996
-----------------------------------------------------
METTLER-TOLEDO,
METTLER-TOLEDO PRO FORMA INC.
GROUP HISTORICAL ADJUSTMENTS PRO FORMA
---------------- -------------- ---------------
(IN THOUSANDS)
<S> <C> <C> <C>
Net sales..................... $423,802 $ 423,802
Cost of sales................. 252,203 $ (1,300)(A) 250,903
---------------- -------------- ---------------
Gross profit................ 171,599 1,300 172,899
Research and development
expenses.................... 25,054 (600)(A) 24,454
Marketing and selling
expenses.................... 81,378 (1,250)(A) 80,128
General and administrative
expenses.................... 39,153 1,150(B) 39,303
Amortization of goodwill and (1,000)(A)
other intangible assets..... 1,270 1,687(C) 2,957
---------------- -------------- ---------------
Income from operations...... 24,744 1,313 26,057
Interest expense.............. 8,346 9,597(D) 19,135
1,192(E)
Financial income (expense),
net......................... 965 (1,813)(F) (848)
---------------- -------------- ---------------
Income before taxes and
minority interest........ 17,363 (11,289) 6,074
Provision for taxes........... 6,830 (3,266)(G) 3,564
Minority interest............. 526 526
---------------- -------------- ---------------
Net income.................... $ 10,007 $ (8,023) $ 1,984
---------------- -------------- ---------------
---------------- -------------- ---------------
</TABLE>
See accompanying notes to Unaudited Pro Forma Statements of Operations.
29
<PAGE>
METTLER-TOLEDO, INC.
NOTES TO UNAUDITED PRO FORMA STATEMENTS OF OPERATIONS
PERIODS ENDED DECEMBER 31, 1995 AND JUNE 30, 1995 AND 1996
(IN THOUSANDS)
(A) Represents the cost savings the Company expects to realize from (i) its
targeted workforce reduction program that is expected to be completed by the end
of 1996 and (ii) the closure of the Company's Westerville, Ohio facility, which
was announced in July 1996. The Company believes it can achieve such cost
savings, which result principally from elimination of (i) the Westerville
facility's fixed manufacturing costs and (ii) the affected employees' salaries
and benefits, without otherwise affecting its cost base or impairing its sales
as a result of available manufacturing capacity in its other facilities.
(B) Reflects the estimated additional general and administrative expenses
the Company anticipates it will incur principally as a result of the Acquisition
and its changed legal, tax and financing structure. These costs include
additional administrative, treasury, internal audit and certain legal services
and an annual management fee of $1,000 to be paid to AEA Investors for
consulting and financial services to be provided to the Company.
(C) Represents the amortization of goodwill and other intangible assets
arising from the Acquisition over their useful lives (five years for
approximately $20 million allocated to patents, 12 to 13 years for approximately
$40 million allocated to trademarks and 40 years for approximately $117 million
of goodwill). See Note (D) to the Unaudited Pro Forma Balance Sheet.
(D) Reflects the net change in interest expense based on the Acquisition
financing:
<TABLE>
<CAPTION>
SIX MONTHS ENDED
JUNE 30,
YEAR ENDED ------------------
DECEMBER 31, 1995 1995 1996
----------------- ------- -------
<S> <C> <C> <C>
Elimination of historical interest
expense on
refinanced debt.................. $ (18,219) $(8,717) $(8,346)
Interest on revolving credit
facility......................... 3,350 1,675 1,675
Interest on term loans............. 19,375 9,687 9,687
Interest on Notes.................. 13,162 6,581 6,581
----------------- ------- -------
Net change....................... $ 17,668 $ 9,226 $ 9,597
----------------- ------- -------
----------------- ------- -------
</TABLE>
For each 0.25% change in the assumed average rate on the revolving credit
facility and term loans under the Credit Agreement and the Notes, interest
expense would change by approximately $1,115 for the year ended December 31,
1995 and $557 for the six months ended June 30, 1995 and 1996.
(E) Represents the amortization of debt issuance fees plus other fees to be
incurred in connection with the Credit Agreement. The amortization periods for
the fees related to the term loans under the Credit Agreement and the Notes are
approximately seven years and ten years, respectively.
(F) Represents elimination of historical interest income.
(G) Estimated income tax effects of pre-tax pro forma adjustments and
related financing structure. The increased pro forma tax rate is principally
attributable to increased non-deductible goodwill expense.
30
<PAGE>
INDEX TO FINANCIAL STATEMENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
METTLER-TOLEDO GROUP
Audited Combined Financial Statements:
Independent Auditors' Report....................................... F-2
Combined Statements of Net Assets as of December 31, 1994 and
1995.............................................................. F-3
Combined Statements of Operations for the years ended December 31,
1993, 1994 and 1995............................................... F-4
Combined Statements of Changes in Net Assets for the years ended
December 31, 1993, 1994 and 1995.................................. F-5
Combined Statements of Cash Flows for the years ended December 31,
1993, 1994 and 1995............................................... F-6
Notes to Combined Financial Statements for the years ended December
31, 1993, 1994 and 1995........................................... F-7
Unaudited Interim Combined Financial Statements:
Interim Combined Statements of Net Assets as of December 31, 1995
and June 30, 1996................................................. F-22
Interim Combined Statements of Operations for the six months ended
June 30, 1995 and 1996............................................ F-23
Interim Combined Statements of Changes in Net Assets for the six
months ended June 30, 1995 and 1996............................... F-24
Interim Combined Statements of Cash Flows for the six months ended
June 30, 1995 and 1996............................................ F-25
Notes to the Interim Combined Financial Statements for the six
months ended June 30, 1995 and 1996............................... F-26
MT ACQUISITION CORP.
Independent Auditors' Report.......................................... F-27
Balance Sheet as of July 16, 1996..................................... F-28
Notes to Balance Sheet as of July 16, 1996............................ F-29
METTLER-TOLEDO HOLDING INC.
Independent Auditors' Report.......................................... F-30
Consolidated Balance Sheet as of July 16, 1996........................ F-31
Notes to Consolidated Balance Sheet as of July 16, 1996............... F-32
</TABLE>
F-1
<PAGE>
INDEPENDENT AUDITORS' REPORT
The Board of Directors
Ciba-Geigy AG
We have audited the accompanying combined statements of net assets of the
Mettler-Toledo Group (as defined in Note 1) as of December 31, 1994 and 1995,
and the related combined statements of operations, changes in net assets and
cash flows for each of the years in the three-year period ended December 31,
1995. These combined financial statements are the responsibility of the Group's
management. Our responsibility is to express an opinion on these combined
financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing standards
in the United States of America. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
In our opinion, the combined financial statements referred to above present
fairly, in all material respects, the combined financial position of the
Mettler-Toledo Group as of December 31, 1994 and 1995, and the combined results
of their operations and their cash flows for each of the years in the three-year
period ended December 31, 1995 in conformity with generally accepted accounting
principles in the United States of America.
KPMG FIDES PEAT
Zurich, Switzerland
February 5, 1996
F-2
<PAGE>
METTLER-TOLEDO GROUP
COMBINED STATEMENTS OF NET ASSETS
AS OF DECEMBER 31, 1994 AND 1995
(IN THOUSANDS)
<TABLE>
<CAPTION>
1994 1995
-------- --------
<S> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents............................ $ 63,802 $ 41,402
Due from Ciba and affiliates (Note 3)................ 18,688 33,072
Trade accounts receivable, net (Note 4).............. 139,315 159,218
Inventories (Note 5)................................. 105,001 110,986
Deferred taxes (Note 15)............................. 6,830 6,180
Other current assets (Note 7)........................ 17,755 21,469
-------- --------
Total current assets.............................. 351,391 372,327
Property, plant and equipment, net (Note 8)............ 230,033 241,018
Goodwill, net (Note 9)................................. 86,833 84,425
Long-term deferred taxes (Note 15)..................... 10,882 14,312
Other assets (Notes 10, 14)............................ 4,059 12,012
-------- --------
Total assets...................................... $683,198 $724,094
-------- --------
-------- --------
LIABILITIES AND NET ASSETS
Current liabilities:
Trade accounts payable............................... $ 31,126 $ 34,389
Accrued and other liabilities (Note 12).............. 86,672 107,118
Taxes payable........................................ 10,596 11,737
Deferred taxes (Note 15)............................. 7,921 7,698
Bank and other loans (Note 11)....................... 24,947 29,513
Notes payable to Ciba and affiliates (Note 13)....... 64,064 91,132
-------- --------
Total current liabilities......................... 225,326 281,587
Long-term debt payable to Ciba and affiliates
(Note 13)............................................ 132,275 145,097
Long-term debt due to third parties (Note 13).......... 862 3,621
Long-term deferred taxes (Note 15)..................... 10,222 13,502
Other long-term liabilities (Note 14).................. 83,964 84,303
-------- --------
Total liabilities................................. 452,649 528,110
Minority interest...................................... 2,355 2,730
Net assets:
Capital employed..................................... 218,129 162,604
Currency translation adjustment...................... 10,065 30,650
-------- --------
Total net assets.................................. 228,194 193,254
-------- --------
Commitments and contingencies (Note 18)
Total liabilities and net assets.................. $683,198 $724,094
-------- --------
-------- --------
</TABLE>
See the accompanying notes to the combined financial statements
F-3
<PAGE>
METTLER-TOLEDO GROUP
COMBINED STATEMENTS OF OPERATIONS
FOR THE YEARS ENDED DECEMBER 31, 1993, 1994 AND 1995
(IN THOUSANDS)
<TABLE>
<CAPTION>
1993 1994 1995
--------- --------- ---------
<S> <C> <C> <C>
Net sales.................................... $ 728,958 $ 769,136 $ 850,415
Cost of sales................................ 443,534 461,629 508,089
--------- --------- ---------
Gross profit............................... 285,424 307,507 342,326
Research and development expenses............ 46,438 47,994 54,542
Marketing and selling expenses............... 141,717 152,631 167,396
General and administrative expenses.......... 68,357 76,248 81,167
Amortization of goodwill..................... 2,535 2,536 2,529
Other charges (income), net (Note 16)........ 18,284 (2,852) (701)
--------- --------- ---------
Income from operations..................... 8,093 30,950 37,393
Interest expense (Note 13)................... 15,239 13,307 18,219
Financial income, net (Note 17).............. 4,174 4,864 8,630
--------- --------- ---------
Income (loss) before taxes and minority
interest................................ (2,972) 22,507 27,804
Provision for taxes (Note 15)................ 3,041 8,676 8,782
Minority interest............................ 1,140 347 768
--------- --------- ---------
Net income (loss).......................... $ (7,153) $ 13,484 $ 18,254
--------- --------- ---------
--------- --------- ---------
</TABLE>
See the accompanying notes to the combined financial statements
F-4
<PAGE>
METTLER-TOLEDO GROUP
COMBINED STATEMENTS OF CHANGES IN NET ASSETS
FOR THE YEARS ENDED DECEMBER 31, 1993, 1994 AND 1995
(IN THOUSANDS)
<TABLE>
<CAPTION>
CURRENCY
CAPITAL TRANSLATION
EMPLOYED ADJUSTMENT TOTAL
-------- ---------- --------
<S> <C> <C> <C>
Net assets at January 1, 1993................ $216,256 $ 36 $216,292
Capital transactions with Ciba and
affiliates................................. (6,460) -- (6,460)
Net loss..................................... (7,153) -- (7,153)
Change in currency translation adjustment.... -- (9,158) (9,158)
-------- ---------- --------
Net assets at December 31, 1993.............. 202,643 (9,122) 193,521
Capital transactions with Ciba and
affiliates................................. 2,002 -- 2,002
Net income................................... 13,484 -- 13,484
Change in currency translation adjustment.... -- 19,187 19,187
-------- ---------- --------
Net assets at December 31, 1994.............. 218,129 10,065 228,194
Capital transactions with Ciba and
affiliates................................. (73,779) -- (73,779)
Net income................................... 18,254 -- 18,254
Change in currency translation adjustment.... -- 20,585 20,585
-------- ---------- --------
Net assets at December 31, 1995.............. $162,604 $ 30,650 $193,254
-------- ---------- --------
-------- ---------- --------
</TABLE>
See the accompanying notes to the combined financial statements
F-5
<PAGE>
METTLER-TOLEDO GROUP
COMBINED STATEMENTS OF CASH FLOWS
FOR THE YEARS ENDED DECEMBER 31, 1993, 1994 AND 1995
(IN THOUSANDS)
<TABLE>
<CAPTION>
1993 1994 1995
-------- -------- --------
<S> <C> <C> <C>
Cash flows from operating activities:
Net income (loss)......................................... $ (7,153) $ 13,484 $ 18,254
Adjustments to reconcile net income (loss) to net cash
provided by operating activities:
Depreciation......................................... 26,674 27,681 30,598
Amortization of goodwill............................. 2,535 2,536 2,529
Amortization and write-down of other intangibles..... 382 3,901 236
Net gain on disposal of long-term assets............. (305) (1,396) (1,053)
Deferred taxes....................................... (2,881) 740 (551)
Minority interest.................................... 1,140 347 768
Increase (decrease) in cash resulting from changes
in:
Trade accounts receivable, net.................... (4,765) (7,410) (9,979)
Inventories....................................... 1,218 (574) (607)
Other current assets.............................. (1,596) 1,636 (3,058)
Trade accounts payable............................ (1,728) (1,123) 1,437
Accruals and other liabilities, net............... 8,935 (5,728) 13,095
-------- -------- --------
Net cash provided by operating activities....... 22,456 34,094 51,669
-------- -------- --------
Cash flows from investing activities:
Proceeds from sale of property, plant and equipment....... 3,799 12,454 4,000
Purchase of property, plant and equipment................. (25,122) (24,916) (25,858)
Investments in other long term assets, net................ (2,534) 162 (7,484)
-------- -------- --------
Net cash used in investing activities........... (23,857) (12,300) (29,342)
-------- -------- --------
Cash flows from financing activities:
Borrowings (repayments) of third party debt............... (2,384) (311) 3,983
Ciba and affiliates borrowings (repayments)............... 16,660 (9,187) (15,693)
Capital transactions with Ciba and affiliates............. (6,460) 2,002 (37,361)
-------- -------- --------
Net cash provided by (used in) financing
activities................................... 7,816 (7,496) (49,071)
-------- -------- --------
Effect of exchange rate changes on cash and cash
equivalents............................................... 2,275 10,040 4,344
-------- -------- --------
Net increase (decrease) in cash and cash equivalents........ 8,690 24,338 (22,400)
Cash and cash equivalents:
Beginning of year......................................... 30,774 39,464 63,802
-------- -------- --------
End of year............................................... $ 39,464 $ 63,802 $ 41,402
-------- -------- --------
-------- -------- --------
Supplemental disclosures of cash flow information:
Cash paid during the year for:
Interest............................................... $ 13,867 $ 13,225 $ 18,927
Taxes.................................................. 6,147 9,370 9,970
Non-cash financing and investing activities:
Due to Ciba for capital transactions (Note 13)............ $ 36,418
</TABLE>
See the accompanying notes to the combined financial statements
F-6
<PAGE>
METTLER-TOLEDO GROUP
NOTES TO THE COMBINED FINANCIAL STATEMENTS
FOR THE YEARS ENDED DECEMBER 31, 1993, 1994 AND 1995
(IN THOUSANDS UNLESS OTHERWISE STATED)
1. BASIS OF PRESENTATION
The accompanying combined financial statements have been prepared in
accordance with United States generally accepted accounting principles ('U.S.
GAAP') on a basis which reflects the combined assets and liabilities ('net
assets') and sales, costs of sales and other income and expenses ('operations')
and cash flows of the companies constituting the Mettler-Toledo Group
('Mettler-Toledo' or the 'Group'). The Group represents the following entities
(including their respective subsidiaries) owned by Ciba-Geigy AG ('Ciba')
assuming that the Group was organized as a separate legal entity for all periods
presented (Ciba ownership percentage is 100% unless otherwise indicated):
<TABLE>
<CAPTION>
JURISDICTION
ENTITY OF ORGANIZATION
- ----------------------------------------------------- -------------------------
<S> <C>
Mettler-Toledo (Holding) Deutschland GmbH............ Germany
MARKET ORGANIZATIONS--EUROPE
Mettler-Toledo GmbH.................................. Germany
Mettler-Toledo Sp. z.o.o........................... Poland
Getmore Gesellschaft fur Marketing & Media Service
GmbH............................................ Germany
Ohaus Waagen Vertriebsgesellschaft mbH............. Germany
Mettler-Toledo SA.................................... France
Ohaus S.a.r.l...................................... France
Mettler-Toledo Ltd................................... United Kingdom
Ohaus Europe, Branch of Ohaus US..................... United Kingdom
Mettler-Toledo (Schweiz) AG.......................... Switzerland
N.V. Mettler-Toledo SA............................... Belgium
Mettler-Toledo BV.................................... Netherlands
Mettler-Toledo S.p.A. (including Grandi Impianti
Mettler-Toledo S.r.l.--52% ownership by Ciba)...... Italy
Mettler-Toledo S.A.E................................. Spain
Mettler-Toledo AB.................................... Sweden
Mettler-Toledo A/S................................. Norway
Mettler-Toledo A/S................................. Denmark
Mettler-Toledo Gesellschaft mbH...................... Austria
Mettler-Toledo spol. s.r.o......................... Slovakia
Mettler-Toledo Service s.r.o....................... Slovakia
Mettler-Toledo spol, s.r.o......................... Czech Republic
Mettler-Toledo Kereskedelmi Kft.................... Hungary
Mettler-Toledo d.o.o............................... Slovenia
Mettler-Toledo d.o.o............................... Croatia
Mettler-Toledo Analyse Industrielle S.ar.l........... France
PRODUCING ORGANIZATIONS--EUROPE
Mettler-Toledo AG.................................... Switzerland
Mettler-Toledo (Albstadt) GmbH....................... Germany
Garvens Automation GmbH.............................. Germany
</TABLE>
F-7
<PAGE>
METTLER-TOLEDO GROUP
NOTES TO THE COMBINED FINANCIAL STATEMENTS--(CONTINUED)
FOR THE YEARS ENDED DECEMBER 31, 1993, 1994 AND 1995
(IN THOUSANDS UNLESS OTHERWISE STATED)
1. BASIS OF PRESENTATION--(CONTINUED)
<TABLE>
<CAPTION>
JURISDICTION
ENTITY OF ORGANIZATION
- ----------------------------------------------------- -------------------------
<S> <C>
AMERICAN COMPANIES
Mettler-Toledo, Inc.................................. United States
Mettler-Toledo Inc................................... Canada
Hi-Speed Checkweigher Co., Inc....................... United States
Mettler-Toledo S.A. de C.V........................... Mexico
Mettler-Toledo Process Analytical Inc................ United States
Ohaus Corporation.................................... United States
Ohaus de Mexico S.A. de C.V.......................... Mexico
Mettler-Toledo Industria e Comercio Ltda.(1)......... Brazil
ASIAN AND PACIFIC COMPANIES
Mettler-Toledo Ltd.(2)............................... Australia
Toledo Scale (HK) Ltd................................ Hong Kong
Mettler-Toledo Instruments (Shanghai) Ltd............ Peoples Republic of China
Mettler-Toledo International Trading (Shanghai)
Corp............................................ Peoples Republic of China
Changzhou Toledo Electronic Scale Ltd. (60% ownership
by Ciba)........................................... Peoples Republic of China
Mettler-Toledo (S.E.A.) Pte. Ltd..................... Singapore
Mettler-Toledo K.K................................... Japan
Mettler-Toledo (M) Sdn. Bhd.......................... Malaysia
Mettler-Toledo (Thailand)(3)......................... Thailand
OTHER COMPANIES
Mettler-Toledo Pac Rim AG............................ Switzerland
Microwa Prazisionswaagen AG.......................... Switzerland
</TABLE>
- ------------------
(1) Subsidiary of Mettler-Toledo AG.
(2) Subsidiary of Mettler-Toledo, Inc.
(3) Division of Ciba as of December 31, 1995. A separate legal entity formed in
1996.
- ------------------
In the opinion of management of the Group, the accompanying combined
financial statements include all material expenses that the Mettler-Toledo Group
would have incurred had it been operating as an independent entity for all
periods presented.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Business
The Mettler-Toledo Group is a manufacturer and marketer of weighing
instruments for use in laboratory, industrial and food retailing applications.
The Group also manufacturers and sells certain related laboratory
F-8
<PAGE>
METTLER-TOLEDO GROUP
NOTES TO THE COMBINED FINANCIAL STATEMENTS--(CONTINUED)
FOR THE YEARS ENDED DECEMBER 31, 1993, 1994 AND 1995
(IN THOUSANDS UNLESS OTHERWISE STATED)
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES--(CONTINUED)
measurement instruments. The Group's manufacturing facilities are located in
Switzerland, the United States, Germany and China. The Group's principal
executive offices are located in Greifensee, Switzerland.
Principles of Combination
The combined financial statements include the entities listed in Note 1.
All transactions and balances between the Companies listed in Note 1 have been
eliminated.
Cash and Cash Equivalents
Cash and cash equivalents include highly liquid investments with original
maturity dates of three months or less.
Inventories
Inventories are valued at the lower of cost or market. Cost, which includes
direct materials, labor and overhead plus indirect overhead, is determined using
the first in, first out (FIFO) or weighted average cost methods and to a lesser
extent the last in, first out (LIFO) method.
Property, Plant and Equipment
Property, plant and equipment are stated at cost less accumulated
depreciation. Depreciation is charged on a straight line basis over the
estimated useful lives of the assets as follows:
<TABLE>
<S> <C>
Buildings and improvements.... 15 to 50 years
Machinery and equipment....... 3 to 12 years
Computer software............. 3 years
Leasehold improvements........ Shorter of useful life or lease term
</TABLE>
Beginning January 1, 1996 the Group adopted Financial Accounting Standards
Board's Statement of Financial Accounting Standards No. 121 (SFAS 121),
'Accounting for the Impairment of Long-Lived Assets and for Long-Lived Assets to
Be Disposed Of'. SFAS 121 requires that long-lived assets and certain
identifiable intangibles to be held and used by an entity be reviewed for
impairment whenever events or changes in circumstances indicate that the
carrying amount of an asset may not be recoverable. In addition, SFAS 121
requires that long-lived assets and certain identifiable intangibles to be
disposed of be reported at the lower of carrying amount or fair value less cost
to sell. Adoption of SFAS 121 had no effect on the combined financial
statements.
Goodwill
Goodwill, which represents the excess of purchase price over the fair value
of net assets acquired, is amortized on a straight-line basis over 40 years
being the expected period to be benefited. The Group assesses the recoverability
of goodwill by determining whether the amortization of the goodwill balance over
its remaining life can be recovered from the undiscounted future operating cash
flows of the acquired operation. The amount of goodwill impairment, if any, is
measured based on projected discounted future operating cash flows using a
discount rate commensurate with the risks involved. The assessment of the
recoverability of goodwill will be impacted if estimated future operating cash
flows are not achieved.
F-9
<PAGE>
METTLER-TOLEDO GROUP
NOTES TO THE COMBINED FINANCIAL STATEMENTS--(CONTINUED)
FOR THE YEARS ENDED DECEMBER 31, 1993, 1994 AND 1995
(IN THOUSANDS UNLESS OTHERWISE STATED)
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES--(CONTINUED)
Taxation
The Group files its own tax returns in each jurisdiction in which it
operates, except in certain jurisdictions where it files jointly with other Ciba
subsidiaries. The Group has a tax sharing arrangement with Ciba in these
countries to share the tax burden or benefits. Such arrangement results in each
company's tax burden or benefit equating to that which it would have incurred or
received if it had been filing a separate tax return.
Taxes are accounted for under the asset and liability method. Deferred tax
assets and liabilities are recognized for the future tax consequences
attributable to differences between the financial statement carrying amounts of
existing assets and liabilities and their respective tax bases and operating
loss and tax credit carryforwards. Deferred tax assets and liabilities are
measured using enacted tax rates in the respective jurisdictions in which the
Group operates that are expected to apply to taxable income in the years in
which those temporary differences are expected to be recovered or settled. The
effect on deferred income tax assets and liabilities of a change in tax rates is
recognized in income in the period that includes the enactment date.
Generally, deferred taxes are not provided on the unremitted earnings of
subsidiaries outside of Switzerland because it is expected that these earnings
are permanently reinvested. Such earnings may become taxable upon the sale or
liquidation of these subsidiaries or upon the remittance of dividends. Deferred
taxes are provided in situations where the Group's subsidiaries plan to make
future dividend distributions.
Research and Development
Research and development costs are expensed as incurred. Research and
development costs, including customer engineering (which represents research and
development funded by customers and, accordingly, is included in cost of sales),
amounted to approximately $52,600, $55,600 and $62,400 during 1993, 1994 and
1995, respectively.
Currency Translation and Transactions
The reporting currency for the combined financial statements of the Group
is the United States dollar (USD). The functional currency for the Group's
operations is generally the applicable local currency. Accordingly, the assets
and liabilities of companies whose functional currency is other than the USD are
included in the combination by translating the assets and liabilities into the
reporting currency at the exchange rates applicable at the end of the reporting
year. The statements of operations and cash flows of such non-USD functional
currency operations are translated at the monthly average exchange rates during
the year. Translation gains or losses are accumulated as a separate component of
net assets. Currency transaction gains or losses arising from transactions of
Group companies in currencies other than the functional currency are included in
operations at each reporting period.
Derivative Financial Instruments
The Group has only limited involvement with derivative financial
instruments and does not use them for trading purposes. Derivative financial
instruments in the form of currency forward and option contracts are entered
into by the Group primarily as a hedge against anticipated currency exposures.
Such contracts limit the Group's exposure to both favorable and unfavorable
currency fluctuations. These contracts are adjusted to reflect market values as
of each balance sheet date, with the resulting unrealized gains and losses being
recognized in financial income or expense, as appropriate.
F-10
<PAGE>
METTLER-TOLEDO GROUP
NOTES TO THE COMBINED FINANCIAL STATEMENTS--(CONTINUED)
FOR THE YEARS ENDED DECEMBER 31, 1993, 1994 AND 1995
(IN THOUSANDS UNLESS OTHERWISE STATED)
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES--(CONTINUED)
Fair Value of Financial Instruments
The carrying amount of cash and cash equivalents, accounts receivable,
other current assets and current liabilities approximates fair market value
because of the short term maturity of these financial instruments. It is not
practical to determine the fair value of balances with Ciba due to the related
party nature of these financial instruments. Other financial instruments are not
significant to the combined financial statements.
Concentration of Credit Risk
The Group's revenue base is widely diversified by geographic region and by
individual customer. The Group's products are utilized in many different
industries, although extensively in the pharmaceutical and chemical industries.
The Group performs ongoing credit evaluations of its customers' financial
condition and, generally, requires no collateral from its customers.
Revenue Recognition
Revenue is recognized when title to a product has transferred or services
have been rendered. Revenues from service contracts are recognized on a
straight-line basis over the contract period.
Use of Estimates
The preparation of financial statements requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities, as well as disclosure of contingent assets and liabilities at the
date of the financial statements and the reported amounts of revenues and
expenses during the reporting period. Actual results may differ from those
estimates.
3. DUE FROM CIBA AND AFFILIATES, NET
The amount due from Ciba, net is comprised of the following:
<TABLE>
<CAPTION>
1994 1995
------- -------
<S> <C> <C>
Cash pool deposits..................................... $18,688 $22,239
Due from AG fur Prazisionsinstrumente ('AGP'), a
subsidiary of Ciba, 6.5%, revolving repayment
terms................................................ -- 10,833
------- -------
$18,688 $33,072
------- -------
------- -------
</TABLE>
Certain Group operating units participate in an arrangement with Ciba
whereby excess cash is pooled into an account maintained by Ciba. The net
deposit with Ciba in connection with this arrangement bears interest at the
short-term money market rates available to Ciba.
Ciba performs certain limited administrative services on behalf of the
Group. The cost of such services, which has not been charged to the Group nor
included in the combined financial statements, would not be significant.
F-11
<PAGE>
METTLER-TOLEDO GROUP
NOTES TO THE COMBINED FINANCIAL STATEMENTS--(CONTINUED)
FOR THE YEARS ENDED DECEMBER 31, 1993, 1994 AND 1995
(IN THOUSANDS UNLESS OTHERWISE STATED)
4. TRADE ACCOUNTS RECEIVABLE, NET
Trade accounts receivable, net, consisted of the following at December 31:
<TABLE>
<CAPTION>
1994 1995
-------- --------
<S> <C> <C>
Trade accounts receivable............... $146,726 $168,510
Allowance for doubtful accounts......... (7,411) (9,292)
-------- --------
$139,315 $159,218
-------- --------
-------- --------
</TABLE>
5. INVENTORIES
Inventories consisted of the following at December 31:
<TABLE>
<CAPTION>
1994 1995
-------- --------
<S> <C> <C>
Raw materials and parts................. $ 46,305 $ 45,523
Work in progress........................ 30,689 38,191
Finished goods.......................... 30,564 30,149
-------- --------
107,558 113,863
LIFO reserve............................ (2,557) (2,877)
-------- --------
$105,001 $110,986
-------- --------
-------- --------
</TABLE>
At December 31, 1994 and 1995, 9.2% and 8.8%, respectively, of the
Company's inventories (certain U.S. companies only) were valued using the LIFO
method of accounting. There were no material liquidations of LIFO inventories
during the periods presented.
6. FINANCIAL INSTRUMENTS WITH OFF-BALANCE SHEET RISKS
The Group may be exposed to credit losses in the event of nonperformance by
the counterparties to its currency forward and option contracts. The Group has
no reason to believe, however, that such counterparties will not be able to
fully satisfy their obligations under these contracts.
At December 31, 1994, the Group had contracts maturing during 1995 to
purchase the equivalent of approximately $130 and to sell the equivalent of
approximately $25,700 in various currencies. At December 31, 1995, the Group had
currency forward and option contracts maturing during 1996 to purchase the
equivalent of approximately $23,300 and to sell the equivalent of approximately
$27,900 in various currencies. These contracts were used to limit its exposure
to currency fluctuations on anticipated future cash flows, primarily for the
delivery and receipt of United States dollars, German marks, and Japanese yen in
exchange for Swiss francs.
At December 31, 1994 and 1995, the fair value of such financial
instruments, which the Group recognized as net unrealized gains, was
approximately $590 and $2,400, respectively.
7. OTHER CURRENT ASSETS
Other current assets consisted of the following at December 31:
<TABLE>
<CAPTION>
1994 1995
------- -------
<S> <C> <C>
Prepaid expenses....................................... $ 4,273 $ 4,703
Other (including net gains on derivative financial
instruments)......................................... 13,482 16,766
------- -------
$17,755 $21,469
------- -------
------- -------
</TABLE>
F-12
<PAGE>
METTLER-TOLEDO GROUP
NOTES TO THE COMBINED FINANCIAL STATEMENTS--(CONTINUED)
FOR THE YEARS ENDED DECEMBER 31, 1993, 1994 AND 1995
(IN THOUSANDS UNLESS OTHERWISE STATED)
8. PROPERTY, PLANT AND EQUIPMENT, NET
Property, plant and equipment, net, consisted of the following at
December 31:
<TABLE>
<CAPTION>
1994 1995
-------- --------
<S> <C> <C>
Land.............................................. $ 28,488 $ 31,535
Buildings and leasehold improvements.............. 166,281 186,608
Machinery and equipment........................... 218,824 237,457
Computer software................................. 4,114 5,373
-------- --------
417,707 460,973
Less accumulated depreciation and amortization.... (187,674) (219,955)
-------- --------
$230,033 $241,018
-------- --------
-------- --------
</TABLE>
9. GOODWILL, NET
Goodwill, net, consists of the following at December 31:
<TABLE>
<CAPTION>
1994 1995
-------- --------
<S> <C> <C>
Cost.......................... $101,572 $101,693
Accumulated amortization...... (14,739) (17,268)
-------- --------
$ 86,833 $ 84,425
-------- --------
-------- --------
</TABLE>
10. OTHER ASSETS
Other assets consisted of the following at December 31:
<TABLE>
<CAPTION>
1994 1995
------ -------
<S> <C> <C>
Bank deposits--restricted cash.......... $1,145 $ 4,697
Secured loans........................... 1,165 2,911
Other................................... 1,749 4,404
------ -------
$4,059 $12,012
------ -------
------ -------
</TABLE>
Bank deposits--restricted cash at December 31, 1994 and 1995 represented
amounts restricted as to use under Switzerland tax law and, in 1995, deposits
collateralizing a letter of credit given by a financial institution in
connection with one of the Company's subsidiaries in the Peoples Republic of
China.
11. BANK AND OTHER LOANS
Bank and other loans consisted of the following at December 31:
<TABLE>
<CAPTION>
1994 1995
------- -------
<S> <C> <C>
Bank overdraft liability................ $15,005 $16,977
Borrowings under line of credit......... 9,161 10,105
Other................................... 781 2,431
------- -------
$24,947 $29,513
------- -------
------- -------
</TABLE>
The weighted average interest rate on the borrowings under line of credit
was approximately 6.6% and 8.0% at December 31, 1994 and 1995, respectively. The
Group had available unused bank lines of credit for short-term financing of
approximately $72,000 at December 31, 1995.
F-13
<PAGE>
METTLER-TOLEDO GROUP
NOTES TO THE COMBINED FINANCIAL STATEMENTS--(CONTINUED)
FOR THE YEARS ENDED DECEMBER 31, 1993, 1994 AND 1995
(IN THOUSANDS UNLESS OTHERWISE STATED)
12. ACCRUED AND OTHER LIABILITIES
Accrued and other liabilities consisted of the following at December 31:
<TABLE>
<CAPTION>
1994 1995
------- --------
<S> <C> <C>
Accrued payroll and vacation................. $22,620 $ 26,400
Social benefits and payroll taxes............ 8,830 9,563
Other taxes payable.......................... 4,318 8,190
Warranty..................................... 5,633 6,420
Other liabilities............................ 45,271 56,545
------- --------
$86,672 $107,118
------- --------
------- --------
</TABLE>
Warranties on Mettler-Toledo products are generally for one year. The Group
provides for warranty costs, which have not been significant, based on
historical experience.
13. DEBT
The Group's debt obligations consist of the following at December 31:
Short-term notes payable to Ciba and affiliates:
<TABLE>
<CAPTION>
1994 1995
------- -------
<S> <C> <C>
Unsecured notes payable:
AGP, 4.25%, due February 29,1996 (renewable)......... $ -- $26,517
Ciba, 7.56%, due December 20, 1995................... 20,000 --
Due to Ciba for capital transactions................... -- 36,418
Due to AGP, 6.5%, revolving repayment terms............ 28,603 --
Other unsecured short-term debt to Ciba, varying
interest rates and maturities........................ 15,461 28,197
------- -------
$64,064 $91,132
------- -------
------- -------
</TABLE>
Long-term debt payable to Ciba and affiliates:
<TABLE>
<CAPTION>
1994 1995
-------- --------
<S> <C> <C>
Unsecured notes payable:
AGP, 8.4%, due December 20, 1999..................... $ -- $122,000
AGP, 6%, due December 20, 1999....................... -- 20,000
Ciba, 8.4%, due December 20, 1999
(refinanced during 1995).......................... 122,000 --
Other unsecured long-term debt to Ciba, varying
interest rates and maturities........................ 10,275 3,097
-------- --------
$132,275 $145,097
-------- --------
-------- --------
</TABLE>
Long-term debt payable to third parties at December 31, 1994 and 1995 was
$862 and $3,621, respectively.
Interest expense consists of the following for the years ended December 31:
<TABLE>
<CAPTION>
1993 1994 1995
------- ------- -------
<S> <C> <C> <C>
Ciba........... $13,402 $10,506 $15,693
Third-party.... 1,837 2,801 2,526
------- ------- -------
$15,239 $13,307 $18,219
------- ------- -------
------- ------- -------
</TABLE>
F-14
<PAGE>
METTLER-TOLEDO GROUP
NOTES TO THE COMBINED FINANCIAL STATEMENTS
FOR THE YEARS ENDED DECEMBER 31, 1993, 1994 AND 1995
(IN THOUSANDS UNLESS OTHERWISE STATED)
14. BENEFIT PLANS
Mettler-Toledo maintains a number of retirement plans for the benefit of
its employees.
Certain group companies sponsor defined contribution plans. Benefits are
determined and funded annually based upon the terms of the plans. Contributions
under these plans amounted to $8,455, $9,042, and $9,413, in 1993, 1994 and
1995, respectively.
Certain group companies sponsor defined benefit plans. Benefits are also
provided to employees under defined benefit plans primarily based upon years of
service and employees' compensation for certain periods during the last years of
employment.
The following table sets forth the funded status and amounts recognized in
the combined financial statements for the Group's principal defined benefit
plans at December 31, 1994 and 1995:
<TABLE>
<CAPTION>
1994 1995
------------------------------- -------------------------------
ASSETS EXCEED ACCUMULATED ASSETS EXCEED ACCUMULATED
ACCUMULATED BENEFITS EXCEED ACCUMULATED BENEFITS EXCEED
BENEFITS ASSETS BENEFITS ASSETS
------------- --------------- ------------- ---------------
<S> <C> <C> <C> <C>
Actuarial present value of accumulated
benefit obligations:
Vested benefits....................... $(8,247) $ (73,144) $ (8,582) $ (90,698)
Non-vested benefits................... (229) (4,279) (90) (3,122)
------------- --------------- ------------- ---------------
(8,476) (77,423) (8,672) (93,820)
------------- --------------- ------------- ---------------
Projected benefit obligations........... (9,166) (90,028) (10,737) (100,820)
Plan assets at fair value............... 10,135 28,414 10,546 40,091
------------- --------------- ------------- ---------------
Plan assets in excess of (less than)
projected benefit obligations......... 969 (61,614) (191) (60,729)
Unrecognized prior service cost
(benefit)............................. 502 1,103 183 (252)
Unrecognized net losses................. 66 1,265 188 247
Unrecognized transition obligations..... -- 3,835 -- 3,851
------------- --------------- ------------- ---------------
Prepaid (accrued) pension costs......... $ 1,537 $ (55,411) $ 180 $ (56,883)
------------- --------------- ------------- ---------------
------------- --------------- ------------- ---------------
</TABLE>
The prepaid (accrued) pension costs are recognized in the accompanying
combined financial statements as other long-term assets and other long term
liabilities, respectively.
The assumed discount rates and rates of increase in future compensation
level used in calculating the projected benefit obligations vary according to
the economic conditions of the country in which the retirement plans are
situated. The range of rates used for the purposes of the above calculations
are:
<TABLE>
<CAPTION>
1994 1995
------------- -------------
<S> <C> <C>
Discount rates................ 6.5% to 9.0% 6.5% to 8.0%
Compensation increase rates... 2.5% to 7.0% 2.5% to 6.0%
</TABLE>
The expected long term rates of return on plan assets ranged between 9.0%
and 9.3% for 1993, 9.5% and 11.0% in 1994, and 9.5% and 10.0% for 1995.
The assumptions used above have a significant effect on the reported
amounts of projected benefit obligations and net periodic pension cost. For
example, increasing the assumed discount rate would have the effect of
decreasing the projected benefit obligation and increasing unrecognized net
gains.
F-15
<PAGE>
METTLER-TOLEDO GROUP
NOTES TO THE COMBINED FINANCIAL STATEMENTS--(CONTINUED)
FOR THE YEARS ENDED DECEMBER 31, 1993, 1994 AND 1995
(IN THOUSANDS UNLESS OTHERWISE STATED)
14. BENEFIT PLANS--(CONTINUED)
Increasing the assumed compensation increase rate would increase the
projected benefit obligation and decrease unrecognized net gains. Increasing the
expected long-term rate of return on investments would decrease unrecognized net
gains.
Plan assets relate principally to the Group's U.S. companies and consist of
equity investments, obligations of the U.S. Treasury or other governmental
agencies, and other interest-bearing investments.
Net periodic pension cost for all of the plans above includes the following
components:
<TABLE>
<CAPTION>
1993 1994 1995
------ ------- -------
<S> <C> <C> <C>
Service cost (benefits earned during the
period).................................... $3,722 $ 3,833 $ 3,668
Interest cost on projected benefit
obligations................................ 6,055 6,426 7,561
Actual return on plan assets................. (3,609) (2,725) (8,653)
Net amortization and deferral................ 1,012 (170) 5,137
------ ------- -------
Net periodic pension expense................. $7,180 $ 7,364 $ 7,713
------ ------- -------
------ ------- -------
</TABLE>
The Group's U.S. operations provide postretirement medical benefits to
their employees. Employee contributions for medical benefits are related to
employee years of service.
The following table sets forth the status of the U.S. postretirement plans
and amounts recognized in the Group's combined financial statements at December
31, 1994 and 1995:
<TABLE>
<CAPTION>
1994 1995
-------- --------
<S> <C> <C>
Accumulated postretirement benefit obligations:
Retired...................................... $(27,837) $(27,682)
Fully eligible............................... (1,252) (1,196)
Other........................................ (2,547) (2,361)
-------- --------
(31,636) (31,239)
Unrecognized net loss.......................... 5,714 6,261
Unrecognized prior service benefit............. -- (692)
Unrecognized transition obligation............. 1,471 1,389
-------- --------
Accrued postretirement benefit cost............ $(24,451) $(24,281)
-------- --------
-------- --------
</TABLE>
Net periodic postretirement benefit cost for the above plans includes the
following components:
<TABLE>
<CAPTION>
1993 1994 1995
------- ------ ------
<S> <C> <C> <C>
Service cost (benefits earned during the
period)......................................... $ 296 $ 333 $ 285
Interest cost on accumulated postretirement
benefit obligations............................. 2,053 2,193 2,371
Net amortization and deferral..................... 82 82 99
------- ------ ------
Net periodic postretirement benefit cost.......... $ 2,431 $2,608 $2,755
------- ------ ------
------- ------ ------
</TABLE>
The accumulated postretirement benefit obligation and net periodic
postretirement benefit cost were determined using discount rates of 8.5% in 1993
and 7.3% in 1994 and 1995, and health care cost trend rates ranging from 10.75%
to 12.25% in 1993, 1994 and 1995, decreasing to 5.5% in 2005.
The health care cost trend rate assumption has a significant effect on the
accumulated postretirement benefit obligation and net periodic postretirement
benefit cost. For example, in 1995 the effect of a one-percentage-point increase
in the assumed health care cost trend rate would be an increase of $2,875 on the
accumulated
F-16
<PAGE>
METTLER-TOLEDO GROUP
NOTES TO THE COMBINED FINANCIAL STATEMENTS--(CONTINUED)
FOR THE YEARS ENDED DECEMBER 31, 1993, 1994 AND 1995
(IN THOUSANDS UNLESS OTHERWISE STATED)
14. BENEFIT PLANS--(CONTINUED)
postretirement benefit obligations and an increase of $251 on the aggregate of
the service and interest cost components of the net periodic benefit cost.
15. TAXES
The sources of the Group's income (loss) before taxes and minority interest
were as follows:
<TABLE>
<CAPTION>
1993 1994 1995
------- ------- -------
<S> <C> <C> <C>
Switzerland.................................. $ (5) $ 9,855 $11,431
Non-Switzerland.............................. (2,967) 12,652 16,373
------- ------- -------
$(2,972) $22,507 $27,804
------- ------- -------
------- ------- -------
</TABLE>
The provision (benefit) for taxes consists of:
<TABLE>
<CAPTION>
CURRENT DEFERRED TOTAL
------- -------- ------
<S> <C> <C> <C>
Year ended December 31, 1993:
Switzerland Federal........................ $ 464 $ (308) $ 156
Switzerland Canton (State) and Local....... 130 (509) (379)
Non-Switzerland............................ 5,328 (2,064) 3,264
------- -------- ------
$5,922 $ (2,881) $3,041
------- -------- ------
------- -------- ------
Year ended December 31, 1994:
Switzerland Federal........................ $1,182 $ (32) $1,150
Switzerland Canton (State) and Local....... 1,215 (53) 1,162
Non-Switzerland............................ 5,538 826 6,364
------- -------- ------
$7,935 $ 741 $8,676
------- -------- ------
------- -------- ------
Year ended December 31, 1995:
Switzerland Federal........................ $ 513 $ (92) $ 421
Switzerland Canton (State) and Local....... 481 (505) (24)
Non-Switzerland............................ 8,339 46 8,385
------- -------- ------
$9,333 $ (551) $8,782
------- -------- ------
------- -------- ------
</TABLE>
The provision for tax expense (benefit) for the years ended December 31,
1993, 1994 and 1995 differed from the amounts computed by applying the
Switzerland federal income tax rate of 9.8% to income (loss) before taxes and
minority interest as a result of the following:
<TABLE>
<CAPTION>
1993 1994 1995
------ ------ ------
<S> <C> <C> <C>
Expected tax................................. $ (291) $2,206 $2,725
Switzerland Canton (state) and local income
taxes, net of federal income tax benefit... (342) 1,048 (21)
Non-deductible goodwill...................... 248 249 248
Change in valuation allowance................ 4,601 (716) 1,603
Non-Switzerland income taxes in excess of
(less than) 9.8%........................... (1,295) 5,591 4,968
Other, net................................... 120 298 (741)
------ ------ ------
$3,041 $8,676 $8,782
------ ------ ------
------ ------ ------
</TABLE>
F-17
<PAGE>
METTLER-TOLEDO GROUP
NOTES TO THE COMBINED FINANCIAL STATEMENTS--(CONTINUED)
FOR THE YEARS ENDED DECEMBER 31, 1993, 1994 AND 1995
(IN THOUSANDS UNLESS OTHERWISE STATED)
15. TAXES--(CONTINUED)
The tax effects of temporary differences that give rise to significant
portions of the deferred tax assets and deferred tax liabilities at December 31,
1994 and 1995 are presented below:
<TABLE>
<CAPTION>
1994 1995
-------- --------
<S> <C> <C>
Deferred tax assets:
Inventory.............................................. $ 8,788 $ 9,706
Accrued and other liabilities.......................... 4,826 6,129
Deferred loss on sale of subsidiaries.................. 6,227 6,725
Accrued postretirement benefit costs................... 9,291 9,227
Accrued pension costs.................................. 5,684 6,276
Non-Switzerland foreign net operating loss
carryforwards........................................ 10,523 10,140
Other.................................................. 5,168 4,082
-------- --------
Total gross deferred tax assets........................ 50,507 52,285
Less valuation allowance............................... (19,563) (21,166)
-------- --------
Gross deferred tax assets less valuation allowance..... 30,944 31,119
-------- --------
Deferred tax liabilities:
Inventory.............................................. 5,946 5,952
Property, plant and equipment.......................... 21,352 21,675
Other.................................................. 4,077 4,200
-------- --------
Total gross deferred tax liabilities................... 31,375 31,827
-------- --------
Net deferred tax liability............................. $ (431) $ (708)
-------- --------
-------- --------
</TABLE>
The net change in the total valuation allowance, including changes
resulting from translation of such amounts from the local functional currencies
to the reporting currency, for the years ended December 31, 1993, 1994 and 1995
was an increase of $4,601 and $1,603 in 1993 and 1995, respectively, and a
decrease of $716 in 1994.
The Group has established valuation allowances primarily for net operating
losses and deferred losses on the sale of subsidiaries as follows:
<TABLE>
<CAPTION>
1994 1995
------- -------
<S> <C> <C>
Net operating losses:
Nordic Region........................................ $ 2,511 $ 2,680
Belgium.............................................. 1,537 1,937
Spain................................................ 2,379 1,551
Australia............................................ 1,189 1,415
Others............................................... 2,907 2,557
------- -------
Total net operating losses............................. 10,523 10,140
Deferred losses on sale of subsidiaries................ 6,227 6,725
Other.................................................. 2,813 4,301
------- -------
Total valuation allowance.............................. $19,563 $21,166
------- -------
------- -------
</TABLE>
At December 31, 1995, the Group had federal net operating loss
carryforwards in various countries other than Switzerland for income tax
purposes of $28,017. Of this amount, $19,363 had no expiration date, relating to
subsidiaries in Sweden, Belgium, Australia, United Kingdom, and Singapore.
Additionally, there were operating
F-18
<PAGE>
METTLER-TOLEDO GROUP
NOTES TO THE COMBINED FINANCIAL STATEMENTS--(CONTINUED)
FOR THE YEARS ENDED DECEMBER 31, 1993, 1994 AND 1995
(IN THOUSANDS UNLESS OTHERWISE STATED)
15. TAXES--(CONTINUED)
losses at that date in various other countries in the amount of $8,654 which
expire in varying amounts through 2001.
In assessing the realizability of deferred tax assets, management considers
whether it is more likely than not that some portion or all of the deferred tax
assets will not be realized. The ultimate realization of deferred tax assets is
dependent upon the generation of future taxable income during the periods in
which those temporary differences become deductible. Management considers the
scheduled reversal of deferred tax liabilities, projected future taxable income,
and tax planning strategies in making this assessment.
16. OTHER CHARGES (INCOME), NET
In June, 1993, Mettler-Toledo management approved a plan of reorganization
designed to reduce the Group's production capacity in Europe. In connection with
the reorganization, the Group recorded in 1993 charges of $19,774, including
approximately $3,800 for non-cash asset writedowns and approximately $16,000 for
severance and other costs. During 1994 the reorganization was substantially
completed.
Other income in 1993, 1994 and 1995 primarily relates to gains from sales
of property, and in 1994 to a gain on sale of a cost basis investment.
17. FINANCIAL INCOME, NET
Financial income (expense) consists of the following for the years ended
December 31:
<TABLE>
<CAPTION>
1993 1994 1995
-------- -------- --------
<S> <C> <C> <C>
Interest income......................... $ 4,590 $ 4,386 $ 5,388
Foreign currency transactions, net...... (416) 478 3,242
-------- -------- --------
$ 4,174 $ 4,864 $ 8,630
-------- -------- --------
-------- -------- --------
</TABLE>
18. COMMITMENTS AND CONTINGENCIES
OPERATING LEASES
The Group leases certain of its facilities in the U.S. and U.K. under
operating leases. The future minimum future lease payments under non-cancelable
operating leases are as follows at December 31, 1995:
<TABLE>
<S> <C>
1996.......... $ 8,497
1997.......... 5,878
1998.......... 3,731
1999.......... 1,802
2000.......... 1,145
Thereafter.... 6,407
-------
Total......... $27,460
-------
-------
</TABLE>
Rent expense for operating leases amounted to $9,077, $10,508 and $11,480
in 1993, 1994 and 1995, respectively.
F-19
<PAGE>
METTLER-TOLEDO GROUP
NOTES TO THE COMBINED FINANCIAL STATEMENTS--(CONTINUED)
FOR THE YEARS ENDED DECEMBER 31, 1993, 1994 AND 1995
(IN THOUSANDS UNLESS OTHERWISE STATED)
18. COMMITMENTS AND CONTINGENCIES--(CONTINUED)
LEGAL
The Group is party to various legal proceedings, including certain
environmental matters, incidental to the normal course of business. Management
does not expect that any of such proceedings will have a material adverse effect
on the Group's financial condition or results of operations.
19. GEOGRAPHIC SEGMENT INFORMATION
The tables below shows the Group's operations by geographic region.
Transfers between geographic regions are priced to reflect consideration of
market conditions and the regulations of the countries in which the transferring
entities are located.
<TABLE>
<CAPTION>
NET SALES BY NET SALES TRANSFERS BETWEEN TOTAL NET SALES INCOME (LOSS)
1993 DESTINATION BY ORIGIN GEOGRAPHIC AREAS BY ORIGIN FROM OPERATIONS
- ------------------ ------------ --------- ----------------- --------------- ---------------
<S> <C> <C> <C> <C> <C> <C>
Switzerland(1).... $ 29,927 $ 83,904 $ 116,281 $ 200,185 $(2,394)
Germany........... 123,464 132,012 34,403 166,415 115
Other Europe...... 193,919 172,527 679 173,206 (2,317)
------------ --------- ----------------- --------------- ---------------
Total Europe...... 347,310 388,443 151,363 539,806 (4,596)
United States..... 258,968 283,615 27,638 311,253 7,319
Other Americas.... 54,713 32,834 62 32,896 1,497
------------ --------- ----------------- --------------- ---------------
Total Americas.... 313,681 316,449 27,700 344,149 8,816
Asia and other.... 67,967 24,066 84 24,150 2,738
Eliminations...... -- -- (179,147) (179,147) 1,135
------------ --------- ----------------- --------------- ---------------
Totals............ $728,958 $ 728,958 $ -- $ 728,958 $ 8,093
------------ --------- ----------------- --------------- ---------------
------------ --------- ----------------- --------------- ---------------
</TABLE>
<TABLE>
<CAPTION>
NET SALES BY NET SALES TRANSFERS BETWEEN TOTAL NET SALES INCOME (LOSS) TOTAL
1994 DESTINATION BY ORIGIN GEOGRAPHIC AREAS BY ORIGIN FROM OPERATIONS ASSETS
- ------------------ ------------ --------- ----------------- --------------- --------------- ---------
<S> <C> <C> <C> <C> <C> <C>
Switzerland(1).... $ 31,992 $ 89,495 $ 133,583 $ 223,078 $10,516 $ 369,868
Germany........... 126,527 133,772 37,056 170,828 10,034 127,071
Other Europe...... 215,230 192,557 776 193,333 1,665 108,692
------------ --------- ----------------- --------------- --------------- ---------
Total Europe...... 373,749 415,824 171,415 587,239 22,215 605,631
United States..... 269,034 300,244 29,877 330,121 10,111 265,440
Other Americas.... 56,628 33,204 64 33,268 939 13,728
------------ --------- ----------------- --------------- --------------- ---------
Total Americas.... 325,662 333,448 29,941 363,389 11,050 279,168
Asia and other.... 69,725 19,864 75 19,939 238 21,601
Eliminations...... -- -- (201,431) (201,431) (2,553) (223,202)
------------ --------- ----------------- --------------- --------------- ---------
Totals............ $769,136 $ 769,136 $ -- $ 769,136 $30,950 $ 683,198
------------ --------- ----------------- --------------- --------------- ---------
------------ --------- ----------------- --------------- --------------- ---------
</TABLE>
F-20
<PAGE>
METTLER-TOLEDO GROUP
NOTES TO THE COMBINED FINANCIAL STATEMENTS--(CONTINUED)
FOR THE YEARS ENDED DECEMBER 31, 1993, 1994 AND 1995
(IN THOUSANDS UNLESS OTHERWISE STATED)
19. GEOGRAPHIC SEGMENT INFORMATION--(CONTINUED)
<TABLE>
<CAPTION>
NET SALES BY NET SALES TRANSFERS BETWEEN TOTAL NET SALES INCOME (LOSS) TOTAL
1995 DESTINATION BY ORIGIN GEOGRAPHIC AREAS BY ORIGIN FROM OPERATIONS ASSETS
- ------------------ ------------ --------- ----------------- --------------- --------------- ---------
<S> <C> <C> <C> <C> <C> <C>
Switzerland(1).... $ 41,820 $ 102,712 $ 159,453 $ 262,165 $ 6,316 $ 593,955
Germany........... 151,974 158,393 47,379 205,772 14,799 196,460
Other Europe...... 247,802 228,939 799 229,738 2,080 123,431
------------ --------- ----------------- --------------- --------------- ---------
Total Europe...... 441,596 490,044 207,631 697,675 23,195 913,846
United States..... 263,945 298,053 29,578 327,631 7,363 257,956
Other Americas.... 52,966 32,732 131 32,863 950 14,474
------------ --------- ----------------- --------------- --------------- ---------
Total Americas.... 316,911 330,785 29,709 360,494 8,313 272,430
Asia and other.... 91,908 29,586 97 29,683 2,331 31,777
Eliminations...... -- -- (237,437) (237,437) 3,554 (493,959)
------------ --------- ----------------- --------------- --------------- ---------
Totals............ $850,415 $ 850,415 $ -- $ 850,415 $37,393 $ 724,094
------------ --------- ----------------- --------------- --------------- ---------
------------ --------- ----------------- --------------- --------------- ---------
</TABLE>
- ------------------
(1) Includes Corporate.
20. SUBSEQUENT EVENT (UNAUDITED)
Pursuant to the terms of a Stock Purchase Agreement (as amended, the
'Agreement') dated April 2, 1996, between AEA MT Inc., AGP, and Ciba, Ciba
agreed to sell to AEA MT Inc. and AEA MT Inc. agreed to purchase from Ciba all
of the capital stock and other equity instruments in the entities listed in Note
1. Consummation of the transaction contemplated by the Agreement is subject to
various terms and conditions.
F-21
<PAGE>
METTLER-TOLEDO GROUP
INTERIM COMBINED STATEMENTS OF NET ASSETS
DECEMBER 31, 1995 AND JUNE 30, 1996
(IN THOUSANDS)
<TABLE>
<CAPTION>
DECEMBER 31, 1995 JUNE 30, 1996
----------------- -------------
(UNAUDITED)
<S> <C> <C>
ASSETS
Current assets
Cash and cash equivalents............. $ 41,402 $ 45,935
Due from Ciba and affiliates.......... 33,072 53,025
Trade accounts receivable, net........ 159,218 157,212
Inventories........................... 110,986 107,342
Deferred taxes........................ 6,180 5,836
Other current assets.................. 21,469 25,040
----------------- -------------
Total current assets.................. 372,327 394,390
Property, plant and equipment, net...... 241,018 225,885
Goodwill, net........................... 84,425 83,155
Long-term deferred taxes................ 14,312 13,596
Other assets............................ 12,012 14,894
----------------- -------------
Total assets....................... $ 724,094 $ 731,920
----------------- -------------
----------------- -------------
LIABILITIES AND NET ASSETS
Current liabilities
Trade accounts payable................ $ 34,389 $ 34,265
Accrued and other liabilities......... 107,118 101,782
Taxes payable......................... 11,737 16,439
Deferred taxes........................ 7,698 7,313
Bank and other loans.................. 29,513 32,610
Notes payable to Ciba and
affiliates......................... 91,132 83,242
----------------- -------------
Total current liabilities.......... 281,587 275,651
Long-term debt payable to Ciba and
affiliates............................ 145,097 152,231
Long-term debt due to third parties..... 3,621 6,015
Long-term deferred taxes................ 13,502 12,827
Other long-term liabilities............. 84,303 88,979
----------------- -------------
Total liabilities.................. 528,110 535,703
Minority interest....................... 2,730 2,855
Net assets:
Capital employed...................... 162,604 173,964
Currency translation adjustment....... 30,650 19,398
----------------- -------------
Total net assets................... 193,254 193,362
----------------- -------------
Total liabilities and net assets... $ 724,094 $ 731,920
----------------- -------------
----------------- -------------
</TABLE>
See the accompanying notes to the interim combined financial statements
F-22
<PAGE>
METTLER-TOLEDO GROUP
INTERIM COMBINED STATEMENTS OF OPERATIONS
SIX MONTHS ENDED JUNE 30, 1995 AND 1996
(IN THOUSANDS)
<TABLE>
<CAPTION>
JUNE 30,
----------------------
1995 1996
--------- ---------
(UNAUDITED)
<S> <C> <C>
Net sales.................................... $ 406,992 $ 423,802
Cost of sales................................ 243,643 252,203
--------- ---------
Gross profit............................ 163,349 171,599
Research and development expenses............ 27,005 25,054
Marketing and selling expenses............... 80,965 81,378
General and administrative expenses.......... 37,909 39,153
Amortization of goodwill..................... 1,289 1,270
--------- ---------
Income from operations.................. 16,181 24,744
Interest expense............................. 8,717 8,346
Financial income, net........................ 2,403 965
--------- ---------
Income before taxes and minority
interest............................... 9,867 17,363
Provision for taxes.......................... 3,117 6,830
Minority interest............................ 270 526
--------- ---------
Net income.............................. $ 6,480 $ 10,007
--------- ---------
--------- ---------
</TABLE>
See the accompanying notes to the interim combined financial statements
F-23
<PAGE>
METTLER-TOLEDO GROUP
INTERIM COMBINED STATEMENTS OF CHANGES IN NET ASSETS
SIX MONTHS ENDED JUNE 30, 1995 AND 1996
(IN THOUSANDS)
<TABLE>
<CAPTION>
CURRENCY
CAPITAL TRANSLATION
EMPLOYED ADJUSTMENT TOTAL
-------- ---------- --------
(UNAUDITED)
<S> <C> <C> <C>
Net assets at January 1, 1995...... $218,129 $ 10,065 $228,194
Capital transactions with Ciba and
affiliates....................... (18,644) -- (18,644)
Net income......................... 6,480 -- 6,480
Change in currency translation
adjustment....................... -- 28,823 28,823
-------- ---------- --------
Net assets at June 30, 1995........ $205,965 $ 38,888 $244,853
-------- ---------- --------
-------- ---------- --------
Net assets at January 1, 1996...... $162,604 $ 30,650 $193,254
Capital transactions with Ciba and
affiliates....................... 1,353 -- 1,353
Net income......................... 10,007 -- 10,007
Change in currency translation
adjustment....................... -- (11,252) (11,252)
-------- ---------- --------
Net assets at June 30, 1996........ $173,964 $ 19,398 $193,362
-------- ---------- --------
-------- ---------- --------
</TABLE>
See the accompanying notes to the interim combined financial statements
F-24
<PAGE>
METTLER TOLEDO GROUP
INTERIM COMBINED STATEMENTS OF CASH FLOWS
SIX MONTHS ENDED JUNE 30, 1995 AND 1996
(IN THOUSANDS)
<TABLE>
<CAPTION>
JUNE 30,
--------------------------
1995 1996
----------- -----------
(UNAUDITED)
<S> <C> <C>
Cash flows from operating activities:
Net income........................................ $ 6,480 $ 10,007
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation................................... 13,880 12,942
Amortization of goodwill....................... 1,289 1,270
Amortization and write-down of other
intangibles................................... 314 147
Net (gain) loss on disposal of long-term
assets........................................ 290 (131)
Deferred taxes................................. 367 (191)
Minority interest.............................. 270 526
Increase (decrease) in cash resulting from
changes in:
Trade accounts receivable, net............... (3,822) (4,666)
Inventories.................................. (1,162) 279
Other current assets......................... (7,306) (352)
Trade accounts payable....................... 597 932
Accruals and other liabilities, net.......... 11,869 16,097
----------- -----------
Net cash provided by operating
activities.............................. 23,066 36,860
----------- -----------
Cash flows from investing activities:
Proceeds from sale of property, plant and
equipment...................................... 1,046 508
Purchase of property, plant and equipment......... (6,527) (10,053)
Investments in other long term assets, net........ (721) (37)
----------- -----------
Net cash used in investing activities..... (6,202) (9,582)
----------- -----------
Cash flows from financing activities:
Repayment of third party debt..................... (2,779) (1,078)
Ciba and affiliates borrowings (repayments)....... 5,291 (16,368)
Capital transactions with Ciba and affiliates..... (9,685) (2,983)
----------- -----------
Net cash used in financing activities..... (7,173) (20,429)
----------- -----------
Effect of exchange rate changes on cash and cash
equivalents.................................... 5,569 (2,316)
----------- -----------
Net increase in cash and cash
equivalents............................. 15,260 4,533
Cash and cash equivalents:........................
Beginning of year.............................. 63,802 41,402
----------- -----------
End of six month period........................ $ 79,062 $ 45,935
----------- -----------
----------- -----------
</TABLE>
See the accompanying notes to the interim combined financial statements
F-25
<PAGE>
METTLER-TOLEDO GROUP
NOTES TO THE INTERIM COMBINED FINANCIAL STATEMENTS
(IN THOUSANDS UNLESS OTHERWISE STATED)
1. BASIS OF PRESENTATION
The accompanying interim combined financial statements have been prepared
in accordance with United States generally accepted accounting principles on a
basis which reflects the interim combined financial statements of the companies
constituting the Mettler-Toledo Group ('Mettler-Toledo' or the 'Group') assuming
that the Group, currently a business unit of Ciba-Geigy AG ('Ciba'), was
organized for all periods presented as a separate legal entity. Pursuant to the
terms of the Stock Purchase Agreement dated April 2, 1996 between AEA MT Inc.,
AG fur Prazisionsinstrumente, and Ciba, Ciba agreed to sell to AEA MT Inc. and
AEA MT Inc. agreed to purchase from Ciba all of the capital stock and other
equity instruments in the entities representing the Group.
The accompanying interim combined financial statements as of June 30, 1996
and for the six month periods ended June 30, 1995 and 1996 should be read in
conjunction with the December 31, 1994 and 1995 combined financial statements
and the notes thereto contained elsewhere in this Prospectus.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
BUSINESS
The Mettler-Toledo Group is a manufacturer and marketer of weighing
instruments for use in laboratory, industrial and food retailing applications.
The Group also manufacturers and sells certain related laboratory measurement
instruments. The Group's manufacturing facilities are located in Switzerland,
the United States, Germany and China.
INVENTORIES
Inventories are valued at the lower of cost or market. Cost, which includes
direct materials, labor and overhead plus indirect overhead, is determined using
the first in, first out (FIFO) or weighted average cost methods, and to a lesser
extent the last in, first out (LIFO) method.
Inventories consisted of the following at December 31, 1995 and June 30,
1996:
<TABLE>
<CAPTION>
DECEMBER 31, JUNE 30,
1995 1996
------------ --------
<S> <C> <C>
Raw materials and parts....... $ 45,523 $ 43,227
Work in progress.............. 38,191 36,810
Finished goods................ 30,149 29,765
------------ --------
113,863 109,802
LIFO reserve.................. (2,877) (2,460)
------------ --------
$110,986 $107,342
------------ --------
------------ --------
</TABLE>
MANAGEMENT REPRESENTATION
The accompanying unaudited interim combined financial statements have been
prepared by Group management pursuant to the rules and regulations of the
Securities and Exchange Commission and reflect all adjustments (consisting of
only normal recurring adjustments) which, in the opinion of management, are
necessary for a fair statement of the results of the interim periods presented.
Operating results for the six month period ended June 30, 1996 are not
necessarily indicative of the results to be expected for the year ending
December 31, 1996.
F-26
