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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
_________________
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): April 12, 1999
Chart Industries, Inc.
------------------------------------------------------
(Exact name of registrant as specified in its charter)
Delaware 1-11442 34-1712937
- ---------------- ------------- --------------------
(State or other (Commission (I.R.S. Employer
jurisdiction of File Number) Identification No.)
incorporation)
5885 Landerbrook Drive, Suite 150, Cleveland, Ohio 44124
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(Address of principal executive offices) (Zip Code)
- -------------------------------------------------------------------------------
(Former Name or Former Address, if Changed Since Last Report)
Registrant's telephone number, including area code: (440) 753-1490
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Item 2. ACQUISITION OR DISPOSITION OF ASSETS.
On April 12, 1999, Chart Industries, Inc. (the "Company") completed
the acquisition of MVE Holdings, Inc. ("MVE"). The acquisition was accomplished
pursuant to an Agreement and Plan of Merger dated as of February 16, 1999, among
Chart Industries, Inc., Chart Acquisition Company and MVE Holdings, Inc. (the
"Agreement"). Chart Acquisition Company is a wholly owned subsidiary of the
Company.
Headquartered in Burnsville, Minnesota, MVE manufactures
vacuum-insulated containment vessels and equipment for storing, transporting and
using cryogenic liquids. These engineering products serve worldwide customers
in the industrial gas, restaurant, medical, agricultural, and liquid natural gas
alternative fuel industries. MVE's products include a wide range of standard
cryogenic storage tanks, specialty tanks, transportation equipment, medical
respiratory products (including liquid oxygen systems), equipment for producing
carbonated beverages and equipment used to store and transport biological matter
and other temperature-sensitive substances. In 1998, MVE had sales of
approximately $208 million. MVE has manufacturing operations in Minnesota,
Georgia, the Czech Republic, Australia and China.
As consideration for this acquisition, Chart Acquisition Company paid
approximately $240 million in cash to purchase all of MVE's common stock and
preferred stock. The purchase price also includes funds used to pay off
existing debt instruments, as well as to complete a tender offer and consent
solicitation for the outstanding 12-1/2% senior secured notes due 2002 issued by
MVE, Inc., a wholly owned subsidiary of MVE. The tender offer and consent
solicitation was priced on April 12, 1999. The purchase price and other terms
of the Agreement were determined through arms-length negotiations. There are no
material relationships between MVE and the Company or any of their affiliates,
directors or officers.
Payment of the purchase price was financed by the Company from
borrowings under its Credit Agreement, dated as of April 12, 1999, between Chart
Industries, Inc., the Subsidiary Borrowers (as defined therein), the Subsidiary
Guarantors (as defined therein), the Lenders (as defined therein), The Chase
Manhattan Bank, as Administrative Agent, and National City Bank, as
Documentation Agent (the "Credit Agreement").
Item 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS.
(a) FINANCIAL STATEMENTS OF BUSINESSES ACQUIRED. Pursuant to Item
7(a)(4) of Form 8-K, the Company will file the required financial statements of
the acquired business by amendment as soon as is practicable, but not later than
60 days after the date on which this Current Report on Form 8-K must be filed.
(b) PRO FORMA FINANCIAL INFORMATION. Pursuant to Item 7(a)(4) of
Form 8-K, the Company will file the required pro forma financial information by
amendment as soon as is
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practicable, but no later than 60 days after the date on which this Current
Report on Form 8-K must be filed.
(c) EXHIBITS.
2.1 Agreement and Plan of Merger, dated as of February 16, 1999, among
Chart Industries, Inc., Chart Acquisition Company and MVE Holdings,
Inc.
2.2 Agreement and Plan of Merger, dated as of February 25, 1999, among
Chart Industries, Inc., Chart Acquisition Company and MVE Investors,
LLC.
10.1 Credit Agreement, dated as of April 12, 1999, between Chart
Industries, Inc., the Subsidiary Borrowers (as defined therein), the
Subsidiary Guarantors (as defined therein), the Lenders (as defined
therein), The Chase Manhattan Bank, as Administrative Agent, and
National City Bank, as Documentation Agent.
10.2 Indemnification and Warrant Purchase Agreement, dated as of April 12,
1999, among Chart Industries, Inc., MVE Holdings, Inc. and each of the
former members of MVE Investors, LLC listed on the signature pages
thereto.
10.3 Form of Promissory Note.
10.4 Form of Mortgage, Assignment of Rents, Security Agreement and Fixture
Filing.
10.5 Warrant Agreement, dated as of April 12, 1999, between Chart
Industries, Inc. and each of the persons listed on the signature pages
thereto.
10.6 Escrow Agreement, dated as of April 12, 1999, by and among MVE
Holdings, Inc., Chart Industries, Inc., Chart Acquisition Company, ACI
Capital I, LLC, in its own capacity and, with respect to the Class B
Escrow Amount (as defined therein), as agent and attorney-in-fact for
each of the former members of MVE Investors, LLC listed therein, and
Firstar Bank of Minnesota, N.A.
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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.
CHART INDUSTRIES, INC.
Date: April 27, 1999 By: /s/ Don A. Baines
----------------------------------------
Don A. Baines
Chief Financial Officer and Treasurer
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EXHIBIT INDEX
Exhibit Description Of Exhibit
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2.1 Agreement and Plan of Merger, dated as of February 16, 1999, among
Chart Industries, Inc., Chart Acquisition Company and MVE Holdings,
Inc.
2.2 Agreement and Plan of Merger, dated as of February 25, 1999, among
Chart Industries, Inc., Chart Acquisition Company and MVE Investors,
LLC.
10.1 Credit Agreement, dated as of April 12, 1999, between Chart
Industries, Inc., the Subsidiary Borrowers (as defined therein), the
Subsidiary Guarantors (as defined therein), the Lenders (as defined
therein), The Chase Manhattan Bank, as Administrative Agent, and
National City Bank, as Documentation Agent.
10.2 Indemnification and Warrant Purchase Agreement, dated as of April 12,
1999, among Chart Industries, Inc., MVE Holdings, Inc. and each of the
former members of MVE Investors, LLC listed on the signature pages
thereto.
10.3 Form of Promissory Note.
10.4 Form of Mortgage, Assignment of Rents, Security Agreement and Fixture
Filing.
10.5 Warrant Agreement, dated as of April 12, 1999, between Chart
Industries, Inc. and each of the persons listed on the signature pages
thereto.
10.6 Escrow Agreement, dated as of April 12, 1999, by and among MVE
Holdings, Inc., Chart Industries, Inc., Chart Acquisition Company, ACI
Capital I, LLC, in its own capacity and, with respect to the Class B
Escrow Amount (as defined therein), as agent and attorney-in-fact for
each of the former members of MVE Investors, LLC listed therein, and
Firstar Bank of Minnesota, N.A.
E-1
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================================================================================
AGREEMENT AND PLAN OF MERGER
dated as of February 16, 1999
among
CHART INDUSTRIES, INC.,
CHART ACQUISITION COMPANY
and
MVE HOLDINGS, INC.
================================================================================
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TABLE OF CONTENTS
Page
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ARTICLE I
THE MERGER........................................................... 2
SECTION 1.1. The Merger....................................... 2
SECTION 1.2. Closing.......................................... 2
SECTION 1.3. Effective Time................................... 2
SECTION 1.4. Effects of the Merger............................ 2
SECTION 1.5. Certificate of Incorporation; By-laws............ 2
SECTION 1.6. Directors........................................ 3
SECTION 1.7. Officers......................................... 3
ARTICLE II
EFFECT OF THE MERGER ON THE SECURITIES OF
THE CONSTITUENT CORPORATION.......................................... 3
SECTION 2.1. Effect on Capital Stock.......................... 3
SECTION 2.2. Treatment of Other Securities of the Company..... 5
SECTION 2.3. Exchange of Certificates......................... 7
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE COMPANY........................ 10
SECTION 3.1. Organization and Qualification; Subsidiaries.... 10
SECTION 3.2. Capitalization.................................. 10
SECTION 3.3. Authority Relative to This Agreement;
Stockholder Approval......................... 12
SECTION 3.4. SEC Reports; Financial Statements............... 13
SECTION 3.5. No Undisclosed Liabilities...................... 13
SECTION 3.6. Absence of Changes.............................. 13
SECTION 3.7. Consents and Approvals; No Violations........... 14
SECTION 3.8. Property........................................ 14
SECTION 3.9. Litigation...................................... 15
SECTION 3.10. Compliance with Applicable Law.................. 15
SECTION 3.11. Employee Plans.................................. 15
SECTION 3.12. Labor Matters................................... 17
SECTION 3.13. Environmental Matters........................... 18
SECTION 3.14. Tax Matters..................................... 19
SECTION 3.15. Material Contracts.............................. 20
SECTION 3.16. Brokers......................................... 21
SECTION 3.17. Opinion of Financial Advisor.................... 21
SECTION 3.18. Anti-Takeover Provisions........................ 21
SECTION 3.19. Intellectual Property........................... 22
SECTION 3.20. Insurance Policies.............................. 22
SECTION 3.21. Certain Business Practices...................... 23
SECTION 3.22. Suppliers and Customers......................... 23
SECTION 3.23. Millennium Compliance........................... 23
SECTION 3.24. Related Party Transactions...................... 23
SECTION 3.25. MVE Restaurant Services, Inc.................... 24
SECTION 3.26. Full Disclosure................................. 24
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Page
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ARTICLE IV
REPRESENTATION AND WARRANTIES OF PARENT AND SUB...................... 24
SECTION 4.1. Organization..................................... 25
SECTION 4.2. Authority Relative to This Agreement............. 25
SECTION 4.3. Consents and Approvals; No Violations............ 25
SECTION 4.4. No Prior Activities.............................. 26
SECTION 4.5. Available Funds.................................. 26
SECTION 4.6. Brokers.......................................... 27
ARTICLE V
COVENANTS RELATED TO CONDUCT OF BUSINESS............................. 27
SECTION 5.1. Conduct of Business of the Company............... 27
SECTION 5.2. Access to Information............................ 31
SECTION 5.3 Notification of Certain Events................... 31
ARTICLE VI
ADDITIONAL AGREEMENTS................................................ 31
SECTION 6.1. Stockholder Consent............................. 31
SECTION 6.2. Reasonable Best Efforts......................... 32
SECTION 6.3. Public Announcements............................ 33
SECTION 6.4. Indemnification; Directors' and Officers'
Insurance..................................... 34
SECTION 6.5. Employee Matters................................ 35
SECTION 6.6. Obligations of Sub.............................. 36
SECTION 6.7. Distribution.................................... 37
SECTION 6.8. Cooperation in Financing........................ 37
SECTION 6.9. Indenture....................................... 37
SECTION 6.10. Subordinated Notes.............................. 38
SECTION 6.11. Repayment of Bank Debt.......................... 38
ARTICLE VII
CONDITIONS TO CONSUMMATION OF THE MERGER............................. 38
SECTION 7.1. Conditions to Each Party's Obligations to
Effect the Merger.............................. 38
SECTION 7.2. Additional Conditions to Parent's and Sub's
Obligations to Effect the Merger............... 38
SECTION 7.3. Additional Conditions to the Company's
Obligations to Effect the Merger............... 40
ARTICLE VIII
TERMINATION; AMENDMENT; WAIVER....................................... 41
SECTION 8.1. Termination...................................... 41
SECTION 8.2. Effect of Termination............................ 42
SECTION 8.3. Fees and Expenses................................ 42
SECTION 8.4. Liquidated Damages............................... 42
SECTION 8.5. Amendment........................................ 43
SECTION 8.6. Extension; Waiver................................ 43
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Page
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ARTICLE IX
SPECIAL INDEMNIFICATION.............................................. 44
SECTION 9.1. Special Indemnification.......................... 44
SECTION 9.2. Method of Asserting Claims....................... 44
SECTION 9.3. Limitations...................................... 44
SECTION 9.4. Escrow Agreement................................. 45
SECTION 9.5. Distribution of Holdback Amount.................. 45
ARTICLE X
MISCELLANEOUS........................................................ 45
SECTION 10.1. Nonsurvival of Representations and Warranties...45
SECTION 10.2. Entire Agreement; Assignment....................45
SECTION 10.3. Notices.........................................46
SECTION 10.4. Governing Law...................................47
SECTION 10.5. Descriptive Headings........................... 47
SECTION 10.6. Parties in Interest............................ 47
SECTION 10.7. Severability................................... 47
SECTION 10.8. Specific Performance........................... 48
SECTION 10.9. Counterparts................................... 48
SECTION 10.10. Interpretation................................. 48
SECTION 10.11. Definitions.................................... 49
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Glossary of Defined Terms
Defined Terms Defined in Section
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ACI Warrant.......................................................2.2(d)
Affiliate..........................................................10.11
Agreement.......................................................Recitals
Antitrust Law.....................................................6.2(b)
beneficial ownership...............................................10.11
Capital Stock........................................................2.1
Cash Amount.......................................................2.1(c)
Certificate of Merger................................................1.3
Class A Merger Consideration......................................2.1(d)
Class A Preferred Stock..............................................2.1
Class B Merger Consideration......................................2.1(d)
Class B Preferred Stock..............................................2.1
Closing..............................................................1.2
Closing Date.........................................................1.2
Commitment Letter....................................................4.5
Common Merger Consideration.......................................2.1(c)
Common Stock.........................................................2.1
Company.........................................................Recitals
Company Disclosure Schedule..................................Article III
Company Permits.....................................................3.10
Company Requisite Vote............................................3.3(b)
Company SEC Reports..................................................3.4
Company Stock Option..............................................2.2(a)
Confidentiality Agreement.........................................5.2(b)
Contract...........................................................10.11
Credit Agreement.....................................................4.5
Damages..............................................................9.1
Date Data...........................................................3.23
Delaware Secretary of State..........................................1.3
DGCL.................................................................1.1
Dissenting Shares.................................................2.1(e)
DOJ...............................................................6.2(b)
Effective Time.......................................................1.3
Employee Benefit Plan............................................3.11(a)
Environmental Law.............................................3.13(a)(i)
Escrow Agent.........................................................9.4
Escrow Agreement.....................................................9.4
Exeter Warrants...................................................2.2(c)
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Defined Terms Defined in Section
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Financials...........................................................3.4
FTC...............................................................6.2(b)
GAAP.................................................................3.4
Government Entity....................................................3.7
Hazardous Material...........................................3.13(a)(ii)
Holdback Amount...................................................2.1(c)
Holdback Termination Date............................................9.1
HSR Act............................................................. 3.7
Indemnification Agreement.........................................7.2(e)
Indemnified Party................................................... 6.4
Indemnitee.......................................................... 9.1
Indemnity Claims.................................................... 9.2
Indenture........................................................... 3.4
IRS............................................................. 3.11(b)
know or knowledge................................................. 10.11
Law............................................................... 10.11
Lien..............................................................3.2(b)
Material Adverse Affect............................................10.11
Material Contracts...............................................3.15(a)
Material Intellectual Property Rights...............................3.19
Members..............................................................9.1
Merger..........................................................Recitals
Merger Consideration..............................................2.1(d)
Millennium Compliant................................................3.23
Misallocation Claims.................................................9.1
MVE..................................................................3.4
MVE Investors.....................................................3.3(b)
Named Employees...................................................6.5(b)
Option Consideration..............................................2.2(a)
Parent..........................................................Recitals
Parent Disclosure Schedule....................................Article IV
Paying Agent......................................................2.3(b)
Payment Fund......................................................2.3(b)
Permitted Lien.....................................................10.11
person.............................................................10.11
Powell Claims........................................................9.1
Public Note Warrant...............................................2.2(b)
Public Note Warrant Agreement.....................................2.2(b)
Release.....................................................3.13(a)(iii)
Remedial Action..............................................3.13(a)(iv)
Restaurant Services.................................................3.25
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Defined Terms Defined in Section
- ------------- ------------------
Restaurant Services Agreement.....................................6.7(c)
SEC..................................................................3.4
Securities Act....................................................3.2(c)
Sub.............................................................Recitals
Subordinated Note Agreement..........................................4.5
subsidiary.........................................................10.11
Surviving Corporation................................................1.1
Tax or Taxes.....................................................3.14(a)
Tax Returns......................................................3.14(a)
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AGREEMENT AND PLAN OF MERGER (this "Agreement") dated as of February
16, 1999 among CHART INDUSTRIES, INC., a Delaware corporation ("Parent"), CHART
ACQUISITION COMPANY, a Delaware corporation and wholly owned subsidiary of
Parent ("Sub") and MVE HOLDINGS, INC., a Delaware corporation (the "Company").
W I T N E S S E T H :
WHEREAS, the Board of Directors of each of Parent, Sub and the
Company has adopted resolutions approving this Agreement, pursuant to which Sub
shall be merged with and into the Company and the Company shall become a wholly
owned, direct subsidiary of Parent (the "Merger"), and has determined that the
Merger would be fair and in the best interests of the stockholders of Parent and
the Company;
WHEREAS, concurrently with the execution of this Agreement, certain
stockholders of the Company, including the holder of the Company's 12 1/2% Class
A Cumulative Convertible Participating Preferred Stock, have executed a written
consent approving this Agreement in accordance with Section 228 of the Delaware
General Corporation Law; and
WHEREAS, Parent, Sub and the Company desire to make certain
representations, warranties, covenants and agreements in connection with the
Merger and also to prescribe various conditions to the Merger;
NOW, THEREFORE, in consideration of the representations, warranties,
covenants and agreements contained in this Agreement, the parties agree as
follows:
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ARTICLE I
THE MERGER
SECTION I.1. The Merger. Upon the terms and subject to the
conditions set forth in this Agreement, and in accordance with the Delaware
General Corporation Law (the "DGCL"), Sub shall be merged with and into the
Company at the Effective Time (as hereinafter defined). Upon the Effective Time,
the separate existence of Sub shall cease, and the Company shall continue as the
surviving corporation (the "Surviving Corporation").
SECTION I.2. Closing. Unless this Agreement shall have been
terminated and the transactions herein contemplated shall have been abandoned
pursuant to Section 8.1 and subject to the satisfaction or waiver of the
conditions set forth in Article VII, the closing of the Merger (the "Closing")
will take place at 10:00 a.m. on the second business day following the date (the
"Closing Date") on which the last to be fulfilled or waived of the conditions
set forth in Sections 7.1, 7.2 and 7.3 shall be fulfilled or waived in
accordance with this Agreement (other than those conditions which by their
nature are to be satisfied at the Closing, but subject to the satisfaction or
waiver of those conditions), at the offices of Weil, Gotshal & Manges LLP, 767
Fifth Avenue, New York, New York unless another date, time or place is agreed to
in writing by the parties hereto.
SECTION I.3. Effective Time. The parties hereto will file with the
Secretary of State of the State of Delaware (the "Delaware Secretary of State")
on the date of the Closing (or on such other date as Parent and the Company may
agree) a certificate of merger (the "Certificate of Merger") or other
appropriate documents, executed in accordance with the relevant provisions of
the DGCL, and make all other filings or recordings required under the DGCL in
connection with the Merger. The Merger shall become effective upon the filing of
the Certificate of Merger with the Delaware Secretary of State, or at such later
time as is specified in the Certificate of Merger (the "Effective Time").
SECTION I.4. Effects of the Merger. The Merger shall have the
effects set forth in Section 259 of the DGCL. Without limiting the generality of
the foregoing, and subject thereto, at the Effective Time, all the properties,
rights, privileges, powers and franchises of the Company and Sub shall vest in
the Surviving Corporation, and all debts, liabilities and duties of the Company
and Sub shall become the debts, liabilities and duties of the Surviving
Corporation.
SECTION I.5. Certificate of Incorporation; By-laws. (a) At the
Effective
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Time, the Company's Certificate of Incorporation shall be the Certificate of
Incorporation of the Surviving Corporation, except that the Certificate of
Incorporation of the Surviving Corporation shall be amended, in a manner not
inconsistent with Section 6.4 of this Agreement, at the discretion of Parent and
Sub.
(b) The By-Laws of Sub as in effect at the Effective Time shall,
from and after the Effective Time, be the By-Laws of the Surviving Corporation
until thereafter changed or amended as provided therein or by applicable law.
SECTION I.6. Directors. The directors of Sub at the Effective Time
shall, from and after the Effective Time, become the directors of the Surviving
Corporation, until the earlier of their resignation or removal or until their
respective successors are duly elected and qualified, as the case may be.
SECTION I.7. Officers. At the Effective Time, the officers of Sub
shall become the officers of the Surviving Corporation, until the earlier of
their resignation or removal or until their respective successors are duly
elected and qualified, as the case may be. The officers of the Surviving
Corporation shall include John Kucharik, David E. Hoffman and Lewis Shender in
their current positions, except that John Kucharik will be President and Chief
Operating Officer of the Surviving Corporation.
ARTICLE II
EFFECT OF THE MERGER ON THE SECURITIES OF THE CONSTITUENT
CORPORATIONS
SECTION II.1. Effect on Capital Stock. As of the Effective Time, by
virtue of the Merger and without any action on the part of the holder of (i) any
shares of (a) common stock, par value $.01 per share, of the Company (the
"Common Stock") (b) 12 1/2% Class A Cumulative Convertible Participating
Preferred Stock, par value $100.00 per share, of the Company (the "Class A
Preferred Stock") and (c) 10% Class B Cumulative Preferred Stock, par value
$100.00 per share, of the Company (the "Class B Preferred Stock" and together
with the Common Stock and the Class A Preferred Stock, the "Capital Stock") or
any other shares of capital stock of the Company or (ii) any shares of capital
stock of Sub, the following shall occur:
(a) Common Stock of Sub. Each share of common stock of Sub issued
and outstanding immediately prior to the Effective Time shall be converted into
and become one validly issued, fully paid and nonassessable share of Common
Stock, par
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value $.01 per share, of the Surviving Corporation.
(b) Cancellation of Treasury Stock. Each share of Capital Stock
issued and outstanding immediately prior to the Effective Time that is owned,
directly or indirectly, by Parent, Sub, the Company or by any subsidiary of the
Company shall automatically be cancelled and retired and shall cease to exist,
and no cash or other consideration shall be delivered or deliverable in exchange
therefor.
(c) Conversion of Common Stock. Each share of Common Stock issued
and outstanding immediately prior to the Effective Time (other than shares to be
cancelled in accordance with Section 2.1(b) and other than Dissenting Shares (as
defined in Section 2.1(e)) shall be converted into the right to receive $25.00
per share net to the holder in cash, without interest (the "Cash Amount") plus
the right to receive a pro rata share of the Holdback Amount (as defined below)
subject to the terms of Article IX hereof (the Cash Amount plus a pro rata share
of the Holdback Amount are together called the "Common Merger Consideration").
As of the Effective Time, subject to Section 9.5 hereof Parent shall deposit (or
cause to be deposited) with the Escrow Agent (as defined in Section 9.4), cash
in the amount of $20 multiplied by the number of shares of Common Stock
outstanding as of the Effective Time (including the Common Stock issuable upon
exercise of the Public Note Warrants and the Exeter Warrants (to the extent not
put to the Company pursuant to the terms thereof) referred to in Sections 2.2(b)
and (c) but excluding any Dissenting Shares) (the "Holdback Amount"). The
Holdback Amount shall be held by the Escrow Agent and disbursed in accordance
with the terms of Article IX and the Escrow Agreement (as defined in Section
9.4).
(d) Preferred Stock. Each share of Class A Preferred Stock issued
and outstanding immediately prior to the Effective Time (other than shares to be
cancelled in accordance with Section 2.1(b)) shall be converted into the right
to receive, per share, the Liquidation Preference (as defined in the Certificate
of Designation of the Company, dated August 26, 1996, with respect to the Class
A Preferred Stock) plus any accrued but unpaid dividends thereon as of the
Effective Date, net to the holder in cash, without interest (the "Class A Merger
Consideration"). Each share of Class B Preferred Stock issued and outstanding
immediately prior to the Effective time shall be converted into the right to
receive, per share, the Liquidation Value (as defined in the Certificate of
Designation of the Company, dated August 26, 1996, with respect to the Class B
Preferred Stock) plus all accrued and unpaid dividends thereon as of the
Effective Date, net to the holder in cash, without interest (the "Class B Merger
Consideration" and together with the Common Merger Consideration and the Class A
Merger Consideration, the "Merger Consideration").
4
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(e) Dissenting Shares. (i) Notwithstanding anything in this
Agreement to the contrary, shares of Capital Stock issued and outstanding
immediately prior to the Effective Time held by a holder (if any) who has the
right to demand, and who properly demands, an appraisal of such shares in
accordance with Section 262 of the DGCL (or any successor provision)
("Dissenting Shares") shall not be converted into a right to receive the Merger
Consideration unless such holder fails to perfect or otherwise loses such
holder's right to such appraisal, if any. If, after the Effective Time, such
holder fails to perfect or loses any such right to appraisal, each such share of
such holder shall be treated as a share that had been converted as of the
Effective Time into the right to receive the Merger Consideration in accordance
with this Section 2.1. At least 21 days prior to the Effective Time, the Company
shall provide notice to the holders of Common Stock of the Merger and the other
transactions contemplated hereby and inform such holders of their appraisal
rights.
(f) Cancellation and Retirement of Capital Stock. As of the
Effective Time, all certificates representing shares of Capital Stock issued and
outstanding immediately prior to the Effective Time, shall no longer be
outstanding and shall automatically be cancelled and retired and shall cease to
exist, and each holder of a certificate representing any such shares of Capital
Stock shall cease to have any rights with respect thereto, except the right to
receive the Merger Consideration, as applicable, upon surrender of such
certificate in accordance with Section 2.3 and rights with respect to Dissenting
Shares, if any, under Section 262 of the DGCL.
(g) Restricted Stock Grants. Immediately prior to the Effective
Time, each restricted share of Common Stock issued under the Company's 1998
Restricted Stock Plan shall fully vest and all such shares of restricted Common
Stock shall be converted into the right to receive the Common Merger
Consideration, subject to the Holdback Amount.
(h) Certain Adjustments. If, between the date of this Agreement and
the Effective Time, the outstanding shares of any class or series of Capital
Stock shall be changed into a different number of shares by reason of any
reclassification, recapitalization, split-up, combination, exchange of shares,
or any dividend payable in stock or other securities (other than the dividend
described in Section 6.7 below) shall be declared thereon with a record date
within such period, the Merger Consideration payable to the holders thereof
shall be adjusted accordingly to provide to such holders the same economic
effect as contemplated by this Agreement prior to such reclassification,
recapitalization, split-up, combination, exchange or dividend.
SECTION II.2. Treatment of Other Securities of the Company.
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(a) Stock Option Plan. Each outstanding option issued pursuant to
the Company 1997 Stock Option Plan to purchase shares of Common Stock (a
"Company Stock Option") shall be cancelled immediately prior to the Effective
Time in exchange for an amount in cash equal to the product of (i) the number of
shares of Common Stock subject to such Company Stock Option and (ii) $1.00 (the
"Option Consideration"). The surrender of a Company Stock Option to the Company
in exchange for the Option Consideration shall be deemed a release of any and
all rights the holder or the Company had or may have had in such Company Stock
Option. Prior to the Effective Time, the Company shall use its reasonable
efforts to obtain all necessary consents or releases from holders of Company
Stock Options and take any such other reasonable action (including any amendment
or modification of the Company 1997 Stock Option Plan) as may be necessary to
give effect to the transactions contemplated by this Section 2.2.
(b) Public Note Warrants. As soon as practicable following the date
of this Agreement, the Company shall take all necessary action to cause each
Warrant issued by the Company in connection with the offering of 12-1/2% Senior
Secured Notes Due 2002 of MVE, Inc. (each, a "Public Note Warrant"), pursuant to
the Warrant Agreement between the Company and American Bank National
Association, as warrant agent, dated as of February 16, 1995 (the "Public Note
Warrant Agreement"), to be converted automatically and without any further
action by the Company or the holders thereof, into the right to receive,
pursuant to Section 2.1(c), an amount equal to the (x) Common Merger
Consideration (subject to the Holdback Amount) multiplied by such number of
shares of Common Stock issuable upon exercise of such Public Note Warrant
assuming it had been exercised immediately prior to the Effective Time, less (y)
the aggregate exercise price of such Public Note Warrant.
(c) Exeter Warrants. As soon as practicable following the date of
this Agreement, the Company shall take all necessary action such that, in the
event any holder of the Warrants to purchase an aggregate of 8,000 shares of
Common Stock originally issued to Exeter Equity Partners, L.P. and Exeter
Venture Lenders, L.P. on or about May 5, 1998 (collectively, the "Exeter
Warrants") elects not to require the Company to purchase its Exeter Warrants,
such Exeter Warrants shall be converted automatically and without any further
action by the Company or the holders thereof, into the right to receive,
pursuant to Section 2.1(c), an amount equal to the (x) Common Merger
Consideration (subject to the Holdback Amount) multiplied by such number of
shares of Common Stock issuable upon exercise of such Exeter Warrants assuming
they had been exercised immediately prior to the Effective Time less (y) the
aggregate exercise price of such Exeter Warrants.
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(d) ACI Warrant. At or immediately prior to the Effective Time, the
Company shall take all necessary action to cause the Warrant to purchase 25,000
shares of Common Stock originally issued to A.C. Israel Enterprises Inc. on
August 27, 1996 (the "ACI Warrant") to be cancelled without consideration.
(e) No Further Rights. The Company shall take all action reasonably
necessary to cause any other plans, programs or arrangements providing for the
issuance or grant of any interest in respect of the capital stock of the Company
or any of its subsidiaries to terminate as of the Effective Time.
SECTION II.3. Exchange of Certificates.
(a) Payment at Closing. At the Effective Time, Parent shall pay by
wire transfer of immediately available funds, to each holder of an outstanding
certificate or certificates which prior thereto represented shares of Common
Stock, Class A Preferred Stock or Class B Preferred Stock (other than any such
shares cancelled without consideration pursuant to Section 2.1(b)), who
surrenders to the Parent such certificate or certificates, the Cash Amount, the
Class A Merger Consideration and the Class B Merger Consideration, as
applicable.
(b) Paying Agent. As of the Effective Time, Parent shall deposit,
with or for the account of a bank or trust company designated by Parent, which
shall be reasonably satisfactory to the Company (the "Paying Agent"), for the
benefit of the holders of shares of Common Stock other than those holders who
have received the Cash Amount at Closing pursuant to Section 2.3(a) and other
than Dissenting Shares, cash in an aggregate amount sufficient to pay the
aggregate unpaid Cash Amount (such amount being hereinafter referred to as the
"Payment Fund").
(c) Exchange Procedures. As soon as practicable after the Effective
Time, each holder of an outstanding certificate or certificates which prior
thereto represented shares of Common Stock (other than any Dissenting Shares)
shall, upon surrender to the Paying Agent of such certificate or certificates
and acceptance thereof by the Paying Agent, be entitled to the per share Cash
Amount multiplied by the aggregate number of shares of Common Stock previously
represented by such certificate(s). The Paying Agent shall accept such
certificates upon compliance with such reasonable terms and conditions as the
Paying Agent may impose to effect an orderly exchange thereof in accordance with
normal exchange practices. If the consideration to be paid in the Merger (or any
portion thereof) is to be delivered to any person other than the person in whose
name the certificate representing shares of Common Stock surrendered in exchange
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therefor is registered, it shall be a condition to such exchange that the
certificate so surrendered shall be properly endorsed or otherwise be in proper
form for transfer and that the person requesting such exchange shall pay to the
Paying Agent any transfer or other taxes required by reason of the payment of
such consideration to a person other than the registered holder of the
certificate surrendered, or shall establish to the satisfaction of the Paying
Agent that such tax has been paid or is not applicable. After the Effective
Time, there shall be no further transfer on the records of the Company or its
transfer agent of certificates representing shares of Common Stock and if such
certificates are presented to the Company for transfer, they shall be cancelled
against delivery of the Cash Amount as hereinabove provided. Until surrendered
as contemplated by this Section 2.3(c), each certificate representing shares of
Common Stock (other than certificates representing shares to be cancelled in
accordance with Section 2.1(b) or Dissenting Shares), shall be deemed at any
time after the Effective Time to represent only the right to receive upon such
surrender the Common Merger Consideration (subject to the Holdback Amount),
without any interest thereon, as contemplated by Section 2.1. No interest will
be paid or will accrue on any cash payable as Common Merger Consideration.
(d) Letter of Transmittal. Promptly after the Effective Time (but in
no event more than 5 days thereafter), the Surviving Corporation shall require
the Paying Agent to mail to each record holder of certificates that immediately
prior to the Effective Time represented shares of Common Stock which have been
converted into Common Merger Consideration, a form of letter of transmittal and
instructions for use in surrendering such certificates and receiving the
consideration to which such holder shall be entitled therefor pursuant to
Section 2.1.
(e) No Further Ownership Rights in Capital Stock. The Merger
Consideration paid upon the surrender for exchange of certificates representing
shares of Capital Stock in accordance with the terms of this Article II and
Section 9.5 below shall be deemed to have been issued and paid in full
satisfaction of all rights pertaining to such shares theretofore represented by
such certificates.
(f) Termination of Payment Fund. Any portion of the Payment Fund
which remains undistributed to the holders of the certificates representing
shares of Common Stock for 120 days after the Effective Time shall be delivered
to Parent, upon demand, and any holders of shares of Common Stock who have not
theretofore complied with this Article II shall thereafter look only to Parent
and only as general creditors thereof for payment of their claim for any Common
Merger Consideration.
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(g) No Liability. None of Parent, Sub, the Surviving Corporation or
the Paying Agent shall be liable to any person in respect of any cash, shares,
dividends or distributions payable from the Payment Fund delivered to a public
official pursuant to any applicable abandoned property, escheat or similar law.
If any certificates representing shares of Common Stock shall not have been
surrendered prior to five years after the Effective Time (or immediately prior
to such earlier date on which any Merger Consideration in respect of such
certificate would otherwise escheat to or become the property of any
Governmental Entity (as defined in Section 3.7), any such cash, shares,
dividends or distributions payable in respect of such certificate shall, to the
extent permitted by applicable law, become the property of the Surviving
Corporation, free and clear of all claims or interest of any person previously
entitled thereto.
(h) Investment of Payment Fund. The Paying Agent shall invest the
Payment Fund in any combination of the following, as directed by Parent: (i)
direct obligations of the United States of America, (ii) obligations for which
the full faith and credit of the United States of America is pledged to provide
for the payment of principal and interest, (iii) commercial paper rated the
highest quality by either Moody's Investors Services, Inc. or Standard & Poor's
Corporation, or (iv) certificates of deposit, bank repurchase agreements or
bankers' acceptances of commercial banks with capital exceeding $100 million,
and any net earnings with respect thereto shall be paid to Parent as and when
requested by Parent; provided that any such investment or any such payment of
earnings shall not delay the receipt by holders of shares of Common Stock of the
Common Merger Consideration or otherwise impair such holders' respective rights
hereunder. Any interest and other income resulting from the investment of the
Payment Fund shall be paid to the Surviving Corporation. In the event the
Payment Fund shall realize a loss on any such investment, Parent shall promptly
thereafter deposit in such Payment Fund on behalf of the Surviving Corporation
cash in an amount sufficient to enable such Payment Fund to satisfy all
remaining obligations originally contemplated to be paid out of such Payment
Fund.
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ARTICLE III
REPRESENTATIONS AND WARRANTIES
OF THE COMPANY
Except as set forth in the disclosure schedule delivered by the
Company to Parent prior to the execution of this Agreement (the "Company
Disclosure Schedule") (each section of which qualifies the correspondingly
numbered representation and warranty or covenant to the extent specified
therein), the Company hereby represents and warrants to each of Parent and Sub
as follows:
SECTION III.1. Organization and Qualification; Subsidiaries. (a) The
Company and each of its subsidiaries is a corporation or legal entity duly
organized, validly existing and in good standing under the Laws of the
jurisdiction of its incorporation and has all requisite corporate, partnership
or similar power and authority to own, lease and operate its properties and to
carry on its businesses as now conducted and proposed by the Company to be
conducted.
(b) Section 3.1 of the Company Disclosure Schedule sets forth a list
of all subsidiaries of the Company. Except as listed in Section 3.1 of the
Company Disclosure Schedule, the Company does not own, directly or indirectly,
beneficially or of record, any shares of capital stock or other security of any
other entity or any other investment in any other entity.
(c) Each of the Company and its subsidiaries is duly qualified or
licensed and in good standing to do business in each jurisdiction in which the
property owned, leased or operated by it or the nature of the business conducted
by it makes such qualification or licensing necessary, except where the failure
to be so duly qualified or licensed and in good standing does not have a
Material Adverse Effect on the Company.
(d) The Company has heretofore delivered or made available to Parent
accurate and complete copies of the certificate of incorporation and bylaws, as
currently in effect, of each of the Company and each of its subsidiaries.
SECTION III.2. Capitalization (a) As of the date of this Agreement,
the Company has 10,000,000 shares of Common Stock authorized for issuance, of
which 132,810 shares are issued and outstanding (including uncertificated
restricted shares of Common Stock), 4,700 shares of Class A Preferred Stock
authorized for issuance, of which 4,700 are issued and outstanding, and 1,400
shares of Class B Preferred Stock
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authorized for issuance, of which 797.08 shares are issued and outstanding. All
of the outstanding shares of the Company's capital stock have been duly
authorized and validly issued and are fully paid and nonassessable and free from
preemptive rights. There are no outstanding options, warrants, convertible
securities, subscriptions or other rights or agreements providing for the
issuance or sale of any shares of capital stock or other securities of the
Company, except as set forth on Section 3.2(a) of the Company Disclosure
Schedule. Section 3.2(a) of the Company Disclosure Schedule sets forth with
respect to each option and warrant listed thereon, the identity of the record
holder thereof (or beneficial holder, if known), the number and type of shares
of capital stock of the Company issuable thereunder, the expiration date (if
any) thereof and the exercise price thereof. Except as set forth on Section
3.2(a) of the Company Disclosure Schedule, the Company is not required to
repurchase, redeem or otherwise acquire or make any payment in respect of any
shares of Capital Stock or other securities of the Company.
(b) Except as set forth on Section 3.2(b) of the Company Disclosure
Schedule, all of the outstanding capital stock of the Company's subsidiaries is
owned by the Company, directly or indirectly, free and clear of any Lien (as
hereinafter defined) or any other limitation or restriction (including any
restriction on the right to vote or sell the same, except as may be provided as
a matter of Law). There are no securities of the Company or its subsidiaries
convertible into or exchangeable for, no options or other rights to acquire from
the Company or its subsidiaries, and no other Contract (whether or not
contingent) providing for the issuance or sale, directly or indirectly, of any
capital stock or other ownership interests in, or any other securities of, any
subsidiary of the Company. There are no outstanding contractual obligations of
the Company or its subsidiaries to repurchase, redeem or otherwise acquire any
outstanding shares of capital stock or other ownership interests in any
subsidiary of the Company. For purposes of this Agreement, "Lien" means, with
respect to any asset (including, without limitation, any security) any mortgage,
lien, pledge, charge, security interest or encumbrance of any kind in respect of
such asset.
(c) Except as set forth in Section 3.2(c) of the Company Disclosure
Schedule, there are no outstanding bonds, debentures, notes or other
indebtedness or other securities of the Company (other than Capital Stock)
having the right to vote, or convertible into or exchangeable for securities
having the right to vote, on any matters on which stockholders of the Company
may vote. Other than as set forth in Section 3.2(c) of the Company Disclosure
Schedule, no indebtedness for borrowed money of the Company or any of its
subsidiaries by its terms contains any restriction upon the incurrence of
indebtedness for borrowed money by the Company or any of its subsidiaries or
restricts the ability of the Company or any of its subsidiaries to grant any
Liens on their respective properties or assets. Except as set forth in Section
3.2(c) of the Company Disclosure
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Schedule, there are no Contracts pursuant to which the Company is or could be
required to register any securities issued by the Company or any subsidiary
under the Securities Act of 1933, as amended (the "Securities Act"), or other
Contracts with or among any security holders of the Company or any of its
subsidiaries with respect to any securities of the Company or any of its
subsidiaries. Except as set forth in Section 3.2(c) of the Company Disclosure
Schedule, to the knowledge of the Company, there are no effective proxies with
respect to any shares of Capital Stock or other securities of the Company or any
of its subsidiaries.
SECTION III.3. Authority Relative to This Agreement; Stockholder
Approval. (a) The Company has all necessary corporate power and authority to
execute and deliver this Agreement and to consummate the transactions
contemplated hereby. No other corporate proceedings on the part of the Company
are necessary to authorize this Agreement or to consummate the transactions
contemplated hereby (other than the Company Requisite Vote (as hereinafter
defined)). This Agreement has been duly and validly executed and delivered by
the Company and constitutes a valid, legal and binding agreement of the Company,
enforceable against the Company in accordance with its terms, subject to
applicable bankruptcy, insolvency, reorganization, moratorium and similar laws
affecting creditors' rights and remedies generally and subject, as to
enforceability, to general principles of equity, including principles of
commercial reasonableness, good faith and fair dealing (regardless of whether
enforcement is sought in a proceeding at law or in equity).
(b) The Board of Directors of the Company, by unanimous vote, has
duly and validly authorized the execution and delivery of this Agreement and
approved the consummation of the transactions contemplated hereby, and has taken
all corporate actions required to be taken by the Company Board for the
consummation of the transactions, including the Merger, contemplated hereby and
has resolved (i) to deem this Agreement and the transactions contemplated
hereby, including the Merger, advisable and fair to, and in the best interests
of, the Company and its stockholders; and (ii) to recommend that the
stockholders of the Company approve and adopt this Agreement. The approval of
the holders of shares of Common Stock and Class A Preferred Stock representing a
majority of the votes that may be cast by the holders of all outstanding shares
of such stock (voting as a single class) as of the record date for such vote
(the "Company Requisite Vote") is the only vote of the holders of any class or
series of capital stock of the Company necessary to adopt this Agreement and
approve the transactions contemplated hereby, including the Merger. MVE
Investors LLC ("MVE Investors") as record holder of all of the outstanding
shares of Class A Preferred Stock has executed a written consent in favor of
approval of the adoption of this Agreement, and no further stockholder action is
required under the DGCL in order to approve the Merger.
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SECTION III.4. SEC Reports; Financial Statements. Pursuant to the
Indenture, dated as of February 16, 1995, of MVE, Inc. ("MVE"), a wholly owned
subsidiary of the Company, with respect to MVE's 12-1/2% Senior Secured Notes
due 2002 (the "Indenture"), and the Public Note Warrant Agreement, each of the
Company and MVE is required to file certain financial information with the
Securities and Exchange Commission (the "SEC"). Such information is not intended
to comply with, and does not comply with, the periodic reporting requirements
under Section 13 of the Securities Exchange Act of 1934, as amended, and the
rules and regulations promulgated thereunder. The Company has heretofore
delivered or made available to Parent, in the form filed with the SEC, all
information filed by the Company and MVE with the SEC since January 1, 1997 (the
"Company SEC Reports"). The information set forth in the Company SEC Reports is
true and correct in all material respects. The consolidated financial statements
of the Company included in the Company SEC Reports (the "Financials") fairly
present, in conformity with generally accepted accounting principles applied on
a consistent basis ("GAAP") (except as may be indicated in the notes thereto),
the consolidated financial position of the Company and its consolidated
subsidiaries as of the dates thereof and their consolidated results of
operations and changes in financial position for the periods then ended
(subject, in the case of the unaudited interim financial statements, to normal
year-end adjustments, none of which, individually or in the aggregate, is
material). The monthly financial statements of the Company as of December 31,
1998, delivered to Parent, are true and correct in all material respects, and
were prepared in a manner consistent with past practice for the preparation of
monthly financial statements.
SECTION III.5. No Undisclosed Liabilities. Except as set forth in
Section 3.5 of the Company Disclosure Schedule and except as and to the extent
disclosed in the Financials and except for liabilities incurred in the ordinary
course of business consistent with past practice since September 30, 1998, none
of the Company or its subsidiaries has (i) any liabilities or obligations of any
nature, whether or not accrued, contingent or otherwise, and whether due or to
become due or asserted or unasserted, which would be required by GAAP to be
reflected in, reserved against or otherwise described in the consolidated
balance sheet of the Company (including the notes thereto) or (ii) any material
liability or obligation of any nature, whether or not accrued, contingent or
otherwise, and whether due or to become due or asserted or unasserted, which is
known to the Company but would not be required to be disclosed by GAAP.
SECTION III.6. Absence of Changes. Except as set forth in Section
3.6 of the Company Disclosure Schedule, since September 30, 1998, each of the
Company and its subsidiaries has conducted its business only in the ordinary
course consistent with
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past practice, and there is not and has not been (i) any Material Adverse Effect
with respect to the Company, (ii) any condition, event or occurrence which would
be reasonably likely to have a Material Adverse Effect on the Company or (iii)
any condition, event or occurrence which could reasonably be expected to
prevent, hinder or materially delay the ability of the Company to consummate the
transactions contemplated hereby.
SECTION III.7. Consents and Approvals; No Violations. Except for
filings, permits, authorizations, consents and approvals as may be required
under, and other applicable requirements of, the Hart-Scott-Rodino Antitrust
Improvements Act of 1976, as amended (the "HSR Act"), the filing and recordation
of the Certificate of Merger as required by the DGCL and as otherwise set forth
in Section 3.7 to the Company Disclosure Schedule, no filing with or notice to,
and no permit, authorization, consent or approval of, any United States or
foreign court or tribunal or administrative, governmental or regulatory body,
agency or authority (a "Governmental Entity") or any person under any Contract
to which the Company or any of its subsidiaries is a party or to which any of
their respective properties or assets is subject, or under any permit issued to
the Company or any of its subsidiaries, is necessary for the execution and
delivery by the Company of this Agreement or the consummation by the Company of
the transactions contemplated hereby, except where the failure to obtain such
permits, authorizations, consents or approvals or to make such filings or give
such notice would not be material to the Company. Neither the execution,
delivery and performance of this Agreement by the Company nor the consummation
by the Company of the transactions contemplated hereby will (i) conflict with or
result in any breach of any provision of the respective certificate or articles
of incorporation or bylaws (or similar governing documents) of the Company or
any of its subsidiaries, (ii) result in a violation or breach of, or constitute
(with or without due notice or lapse of time or both) a default (or give rise to
any right of termination, amendment, cancellation or acceleration or Lien)
under, any of the terms, conditions or provisions of any Contract to which the
Company or any of its subsidiaries is a party or by which any of them or any of
their respective properties or assets may be bound, or (iii) violate any Law
applicable to the Company or any of its subsidiaries or any of their respective
properties or assets, except in the case of (ii) or (iii) for violations,
breaches or defaults which do not have a Material Adverse Effect on the Company.
SECTION III.8. Property. Except as set forth in Section 3.8 of the
Company Disclosure Schedule, the Company and each subsidiary of the Company has
good, marketable and valid title in and to all of its material assets, including
all real, personal and intangible property, and except as reflected on Section
3.8 of the Company Disclosure Schedule, the Company and each subsidiary of the
Company holds its assets free and clear of any Liens (other than Permitted
Liens).
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SECTION III.9. Litigation. Except as disclosed on Section 3.9 of the
Company Disclosure Schedule, there is no suit, claim, action, proceeding or
investigation pending or, to the Company's knowledge, threatened against the
Company or any of its subsidiaries or any of their respective properties or
assets which (a) seeks damages in excess of $100,000 or (b) as of the date
hereof, questions the validity of this Agreement, or any action to be taken by
the Company in connection with the consummation of the transactions contemplated
hereby or could otherwise prevent or delay the consummation of the transactions
contemplated by this Agreement. Except as disclosed in Section 3.9 of the
Company Disclosure Schedule, none of the Company or its subsidiaries is subject
to any outstanding material order, writ, injunction or decree.
SECTION III.10. Compliance with Applicable Law. The Company and its
subsidiaries hold all material permits, licenses, variances, exemptions, orders
and approvals of all Governmental Entities necessary for the lawful conduct of
their respective businesses (the "Company Permits"), except as set forth in
Section 3.13 of the Company Disclosure Schedule. Except as set forth in Section
3.13 of the Company Disclosure Schedule, the Company and its subsidiaries are in
compliance in all material respects with the terms of the Company Permits. Each
of the Company and its subsidiaries is in compliance in all material respects
with all material Laws. To the Company's knowledge, except as set forth in
Section 3.10 of the Company Disclosure Schedule, no material investigation or
review by any Governmental Entity with respect to the Company or its
subsidiaries is pending or threatened, nor, to the Company's knowledge, has any
Governmental Entity indicated an intention to conduct the same.
SECTION III.11. Employee Plans. (a) The Company has made available
to Parent all "employee benefit plans," as defined in Section 3(3) of ERISA, and
all material bonus or other incentive compensation, equity or equity-based
compensation, deferred compensation and severance pay, plans or policies that
the Company or any of its subsidiaries has any obligation to or liability for
(each an "Employee Benefit Plan" and collectively, the "Employee Benefit
Plans").
(b) True, correct and complete copies of the following documents,
with respect to each of the Employee Benefit Plans (other than a Multiemployer
Plan) have been made available or delivered to Parent by the Company (i) the
most recent plan document and related trust documents, and amendments thereto;
(ii) the most recent Forms 5500 and schedules thereto; (iii) the most recent
Internal Revenue Service ("IRS") determination letter; (iv) the most recent
financial statements and actuarial valuations, if applicable; and (v) the most
recent summary plan descriptions.
(c) As of the date hereof, except for such non-compliance which
would
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not have a Material Adverse Effect on the Company, (i) all payments required to
be made by or under any Employee Benefit Plan, any related trusts, or any
collective bargaining agreement or pursuant to Law have been made by the due
date thereof (including any valid extension); (ii) the Employee Benefit Plans
(other than any multiemployer plans), have been administered in compliance with
their terms and the requirements of ERISA, the Code and other applicable Laws;
and (iii) to the Company's knowledge, there are no actions, suits, arbitrations
or claims (other than routine claims for benefit) pending or threatened with
respect to any Employee Benefit Plan.
(d) Except as set forth in Section 3.11(d) or the Company Disclosure
Schedule, there has been no "reportable event" as that term is defined in
Section 4043 of ERISA and the regulations thereunder with respect to any
Employee Benefit Plan subject to Title IV of ERISA which would require the
giving of notice or any event requiring disclosure under Section 4041(c)(3)(C)
or 4063(a) of ERISA which would reasonably be expected to result in a Material
Adverse Effect on the Company.
(e) Each of the Employee Benefit Plans which is intended to qualify
under Section 401(a) of the Code has been determined by the IRS to so qualify,
and the trusts maintained pursuant thereto are exempt from federal income
taxation under Section 501 of the Code, and the Company knows of no fact which
would adversely affect the qualified status of any such pension plan or the
exemption of such trust and which would reasonably be expected to result in a
Material Adverse Effect on the Company.
(f) Except as set forth in Section 3.11(f) of the Disclosure
Schedule, neither the execution and delivery of this Agreement nor the
consummation of the transactions contemplated hereby, will except as expressly
contemplated by this Agreement, (i) result in any material payment becoming due,
or materially increase the amount of compensation due, to any current or former
employee of the Company or any of its subsidiaries; (ii) materially increase any
benefits otherwise payable under any Employee Benefit Plan; or (iii) result in
the acceleration of the time of payment or vesting of any such material
benefits.
(g) Other than as set forth in Section 3.11(g) of the Company
Disclosure Schedule, neither the Company nor any of its subsidiaries has any
rights plan, preferred stock plan, deferred compensation plan or similar
Contract which applies to or provides for the grant or acceleration of any
benefits as a result of the transactions contemplated hereby.
(h) Except as set forth in Section 3.11(h) of the Company Disclosure
Schedule, there are no material unfunded benefit liabilities with respect to any
defined
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benefit plan maintained by the Company or any of its subsidiaries, as determined
under reasonable actuarial assumptions. No pension plan maintained by the
Company or any of its subsidiaries has incurred an accumulated funding
deficiency, whether or not waived
SECTION III.12. Labor Matters. (a) Section 3.12 of the Company
Disclosure Schedule sets forth a list of all employment, labor or collective
bargaining agreements to which the Company or any subsidiary is party which
calls for the payment by the Company in any single year of an amount in excess
of $100,000 and except as set forth therein, there are no material employment,
labor or collective bargaining agreements which pertain to employees of the
Company or any of its subsidiaries. Except as set forth on Section 3.12 of the
Company Disclosure Schedule, the Company has heretofore made available to Parent
true and complete copies of the employment agreements and the labor or
collective bargaining agreements listed on Section 3.12 of the Company
Disclosure Schedule, together with all amendments, modifications, supplements
and side letters affecting the duties, rights and obligations of any party
thereunder.
(b) Except as set forth in Section 3.12 of the Company Disclosure
Schedule, no employees of the Company or any of its U.S. subsidiaries are
represented by any labor organization; no labor organization or group of
employees of the Company or any of its subsidiaries has made a pending demand
for recognition or certification; and, to the Company's knowledge, there are no
representation or certification proceedings or petitions seeking a
representation proceeding presently pending or threatened in writing to be
brought or filed with the National Labor Relations Board or any other labor
relations tribunal or authority. To the Company's knowledge, except as set forth
in Section 3.12 of the Company Disclosure Schedule, there are no organizing
activities involving the Company or any of its subsidiaries pending with any
labor organization or group of employees of the Company or any of its
subsidiaries. Except as set forth in Section 3.12 to the Company Disclosure
Schedule, there is no strike, work stoppage or other major labor dispute
involving the Company or any of its subsidiaries pending or, to the knowledge of
the Company, threatened.
(c) Except as set forth on Section 3.12 to the Company Disclosure
Schedule, there are no material unfair labor practice charges, grievances or
complaints pending or to the best of the Company's knowledge, threatened in
writing by or on behalf of any employee or group of employees of the Company or
any of its subsidiaries.
(d) Except as set forth in Section 3.12 of the Company Disclosure
Schedule, there are no complaints, charges or claims against the Company or any
of its subsidiaries pending, or to the best of the Company's knowledge,
threatened in writing, arising out of, in connection with, or otherwise relating
to the employment or termination
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of employment of any individual by the Company or any of its subsidiaries which
would be material to the Company, including, without limitation, any
discrimination claims or sexual harassment claims. Except as set forth in
Section 3.12 of the Company Disclosure Schedule, and except for payments in the
ordinary course of business, neither the Company nor any of its subsidiaries is
liable for any severance pay or other payments to any employee, former employee
or beneficiary of any employee or former employee arising out of any termination
of employment or other change in employment relationship.
SECTION III.13. Environmental Matters. (a) For purposes of this
Agreement:
(i) "Environmental Law" means any applicable federal, state,
local or foreign Law (including common Law) or other legal requirement relating
to the protection of natural resources, the environment and public and employee
health and safety or pollution or the release or exposure to Hazardous Materials
(as hereinafter defined) as such Laws have been and may be amended or
supplemented through the Closing Date;
(ii) "Hazardous Material" means any substance, material or
waste which is regulated, classified or otherwise characterized as hazardous,
toxic, pollutant, contaminant or words of similar meaning or regulatory effect
by any Governmental Entity or the United States, and includes, without
limitation, petroleum, petroleum by-products and wastes, asbestos and
polychlorinated biphenyls;
(iii) "Release" means any release, spill, effluent, emission,
leaking, pumping, injection, deposit, disposal, discharge, dispersal, leaching,
or migration into the indoor or outdoor environment, or into or out of any
property owned, operated or leased by the applicable party or its subsidiaries;
and
(iv) "Remedial Action" means all actions, including, without
limitation, any capital expenditures, required by a Governmental Entity or
required under or taken pursuant to any Environmental Law, or voluntarily
undertaken to (A) clean up, remove, treat, or in any other way, ameliorate or
address any Hazardous Materials or other substance in the indoor or outdoor
environment; (B) prevent the Release or threat of Release, or minimize the
further Release of any Hazardous Material so it does not endanger or threaten to
endanger the public health or welfare of the indoor or outdoor environment; (C)
perform pre-remedial studies and investigations or post-remedial monitoring and
care pertaining or relating to a Release; or (D) bring the applicable party into
compliance with any Environmental Law.
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(b) Except as set forth in Section 3.13 of the Company Disclosure
Schedule:
(i) The Company and its subsidiaries are and have been in
compliance in all material respects with all applicable Environmental Laws;
(ii) The Company and its subsidiaries have all material
permits, authorizations, licenses or similar approvals required under applicable
Environmental Laws for the continued operations of their respective businesses,
and no material modification, revocation, reissuance or amendment will occur or
is required in connection with the transactions contemplated by this Agreement;
(iii) Neither the Company nor any of its subsidiaries is
subject to any outstanding written orders or decrees issued by any Governmental
Entity or is a party to any Contract with any person respecting (A)
Environmental Laws, (B) Remedial Action or (C) any Release or threatened Release
of a Hazardous Material;
(iv) Neither the Company nor any of its subsidiaries has
received any written communication alleging, with respect to any such party, the
violation of any Environmental Law, which violation would materially and
adversely affect the Company; and
(v) No judicial or administrative proceedings are pending or,
to the Company's knowledge, threatened against the Company or any of its
subsidiaries alleging the violation of or seeking to impose liability pursuant
to any Environmental Law and there are no investigations pending or, to the
Company's knowledge, threatened against the Company or any of its subsidiaries
under any Environmental Laws.
SECTION III.14. Tax Matters. (a) The Company and each of its
subsidiaries has timely filed all material Tax Returns (as hereinafter defined)
required to be filed by it. All such Tax Returns are materially complete and
correct. The Company and each of its subsidiaries has paid (or the Company has
paid on its subsidiaries' behalf) all Taxes shown due on such returns, or has
established reserves therefor. For purposes of this Agreement, "Tax" or "Taxes"
shall mean all taxes, charges, fees, imposts, or levies, including, without
limitation, all net income, gross receipts, capital, sales, use, ad valorem,
value added, transfer, franchise, profits, inventory, capital stock, license,
withholding, payroll, employment, social security, unemployment, excise,
severance, stamp, occupation, and property taxes, together with any interest and
any penalties, fines, additions to tax or additional amounts imposed by any
taxing authority (domestic or foreign). "Tax Returns" shall mean any report,
return, document, declaration or any
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other information or filing required to be supplied to any taxing authority or
jurisdiction (foreign or domestic) with respect to Taxes, including, without
limitation, information returns, any document with respect to or accompanying
payments or estimated Taxes.
(b) No material deficiencies for any Taxes have been proposed,
asserted or assessed against the Company or any of its subsidiaries that have
not been fully paid or adequately provided for in the appropriate financial
statements of the Company and its subsidiaries, no requests for waivers or
extensions of the time to assess any Taxes are pending, and no power of attorney
with respect to any Taxes has been executed or filed with any taxing authority.
All U.S. Federal income Tax Returns filed by or on behalf of the Company or any
of its subsidiaries for taxable periods prior to February, 1995 have been
reviewed by the relevant taxing authority.
(c) Except as set forth in Section 3.14(c) of the Company Disclosure
Schedule, none of the Company or any of its subsidiaries is a party to or is
bound by any Tax sharing agreement, Tax indemnity obligation or similar
agreement, arrangement or practice with respect to Taxes. Except as set forth in
Section 3.14(c) of the Company Disclosure Schedule, to the Company's knowledge,
no audit of any Tax Return of the Company or any of its subsidiaries is being
conducted by any taxing authority.
SECTION III.15. Material Contracts. (a) Section 3.15 of the Company
Disclosure Schedule sets forth a list of the following types of written
Contracts to which the Company or any of its subsidiaries is a party or to which
any of their respective assets are subject: (i) employment Contracts outside the
ordinary course of business, severance Contracts, personal services or
consulting Contracts providing for payments in excess of $250,000 per year,
non-competition Contracts imposing material competition restrictions on the
Company or its subsidiaries or indemnification Contracts outside the ordinary
course of business (including, without limitation, any Contract to which the
Company or any of its subsidiaries is a party involving employees of the
Company); (ii) licensing, distribution or dealership Contracts providing for
exclusivity in any region that constituted 5% or more of the Company's gross
revenues in the Company's latest fiscal year or for payments in excess of
$500,000 per year; (iii) partnership or joint venture Contracts; (iv) Contracts
for the acquisition, sale or lease of properties or assets of the Company or any
subsidiary in an amount greater than $500,000 (by merger, purchase or sale of
assets or stock or otherwise (other than the sale of products of the Company or
any subsidiaries in the ordinary course of business)) entered into since August
27, 1996; (v) loan or credit agreements, mortgages, indentures or other
Contracts or instruments evidencing indebtedness for borrowed money by the
Company or any of its subsidiaries or any Liens related to such Contracts or any
Contracts pursuant to which indebtedness for borrowed money may be incurred;
(vi) all Contracts outside the ordinary course of business relating
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to Material Intellectual Property Rights (as defined herein) (vii) all Contracts
with any current or former shareholder, officer or director of the Company or
any of its subsidiaries, other than those disclosed on Section 3.24 of the
Company Disclosure Schedule; (viii) all other Contracts, other than purchase and
sales orders entered into in the ordinary course of business, which involve
amounts in excess of $1,000,000 and all other material Contracts which are not
terminable by either party thereto without penalty upon not more than 90 days
notice to the other party; and (ix) any Contracts to enter into any of the
foregoing (collectively, the "Material Contracts").
(b) Each of the Material Contracts constitutes the valid and legally
binding obligation of the Company or its subsidiaries, enforceable in accordance
with its terms (except as enforceability may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium, fraudulent transfer and
similar Laws of general applicability relating to or affecting creditors' rights
or by general equity principles), and is in full force and effect. Except as
disclosed on Section 3.15(b) of the Company Disclosure Schedule, there is no
material default under any Material Contract either by the Company or, to the
Company's knowledge, by any other party thereto, and no event has occurred that
with the lapse of time or the giving of notice or both would constitute a
material default thereunder by the Company or, to the Company's knowledge, any
other party.
SECTION III.16. Brokers. Except for Donaldson, Lufkin & Jenrette
Securities Corporation, the fees and expenses of which will be paid by the
Company pursuant to an engagement letter, a copy of which has been provided to
Parent, no broker, finder or investment banker is entitled to any brokerage,
finder's or other fee or commission or expense reimbursement in connection with
the transactions contemplated by this Agreement based upon arrangements made by
and on behalf of the Company or any of its Affiliates. The aggregate fees
payable to Donaldson, Lufkin & Jenrette Securities Corporation are not expected
to exceed $400,000 plus expenses.
SECTION III.17. Opinion of Financial Advisor. Donaldson, Lufkin &
Jenrette Securities Corporation has delivered to the Company its written
opinion, dated February 15, 1999, to the effect, that based upon and subject to
the assumptions and qualifications set forth therein, the aggregate Merger
Consideration to be received by the holders of Common Stock, the Class A
Preferred Stock and Class B Preferred Stock of the Company, taken together,
pursuant to the Agreement is fair to such stockholders from a financial point of
view.
SECTION III.18. Anti-Takeover Provisions. The Company has taken all
steps necessary to exempt the Merger and the other transactions contemplated
hereby from the requirements of any "business combination," "moratorium,"
"control bid," "control
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share," or other anti-takeover Law of any state or foreign country which (i)
restricts the Company's ability to consummate the Merger or the other
transactions contemplated hereby, (ii) would have the effect of invalidating or
voiding this Agreement or any provision hereof, or (iii) would subject Parent or
Sub to any material impediment or condition in connection with the exercise of
their respective rights under this Agreement or their ownership and operation of
the business of the Surviving Corporation and its subsidiaries after the
Effective Time.
SECTION III.19. Intellectual Property. As used herein, the term
"Intellectual Property Rights" means any registered trade names, trademarks and
service marks and all applications therefor, all registered patents and all
applications therefor and all reissues, divisions, continuations and extensions
thereof. Section 3.19 of the Company Disclosure Schedule lists all Intellectual
Property Rights which are material to the operations of the Company and its
subsidiaries, taken as a whole ("Material Intellectual Property Rights"), and
which are owned by the Company or any of its subsidiaries or with respect to
which (as noted in Section 3.19 of the Company Disclosure Schedule) the Company
or any of its subsidiaries has any material right or license. To the Company's
knowledge, the Material Intellectual Property Rights are valid and in full force
and effect. Except as set forth in Section 3.19 of the Company Disclosure
Schedule, there have been no material interference actions or other judicial,
arbitration or other adversary proceedings concerning any of the Material
Intellectual Property Rights. Neither the Company nor any of its subsidiaries
has disposed of or permitted to lapse, or otherwise failed to preserve its right
to use, any of its Material Intellectual Property Rights. Except as disclosed in
Section 3.19 of the Company Disclosure Schedule, to the Company's knowledge,
neither the Company nor any of its subsidiaries has infringed any Intellectual
Property Right of any other person and, to the Company's knowledge, no such
infringement has been alleged in writing by any other person within the past
three years. Except as disclosed in Section 3.19 of the Company Disclosure
Schedule, to the knowledge of the Company, there has not been any infringement
by any other person of any of the Intellectual Property Rights of the Company or
any of its subsidiaries. Each of the Company and each of its subsidiaries has
the right to use all Intellectual Property Rights as are necessary to enable it
to conduct all material phases of its business in the manner presently conducted
by it.
SECTION III.20. Insurance Policies. Section 3.20 of the Company
Disclosure Schedule contains a list of all insurance policies of the Company and
its U.S. Subsidiaries and each such policy is in full force and effect. All
premiums with respect to such insurance policies which are due and payable prior
to the date of this Agreement have been paid, and no written notice of
cancellation or termination has been received by the Company with respect to any
such policy.
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SECTION III.21. Certain Business Practices. Since August 27, 1996,
except as set forth in Section 3.21 of the Company Disclosure Schedule, neither
the Company nor any of its subsidiaries, nor to the Company's knowledge any
directors, officers, agents or employees of the Company or any of its
subsidiaries, (i) has used any funds for unlawful contributions, gifts,
entertainment or other expenses related to political activity, (ii) has made any
unlawful payment to any foreign or domestic government officials or employees or
to foreign or domestic political parties or campaigns or violated any provision
of the Foreign Corrupt Practices Act of 1977, as amended or (iii) has violated
any Law relating to the sale or export of technology or products into foreign
countries.
SECTION III.22. Suppliers and Customers. Except as set forth in
Section 3.22 of the Company Disclosure Schedule, since November 30, 1998,
neither the Company nor any of its subsidiaries has received any written notice
from any supplier or customer of the Company or any of its subsidiaries of such
supplier's or customer's intention to cancel an existing agreement, with the
Company or such subsidiary prior to its expiration date, which agreement
involves the purchase or sale in any given year of amounts in excess of
$5,000,000.
SECTION III.23. Millennium Compliance. All information systems used
by the Company in connection with the operations of the Company and its
subsidiaries are Millennium Compliant in all material respects. For purposes of
this Agreement, the term "Millennium Compliant" means the ability, when used
individually or in conjunction with any other systems, software or equipment,
to: (i) accurately process Date Data before, after and across December 31, 1999
and throughout the year 2000 and beyond; (ii) provide correct results when
moving backwards and forwards between the 20th and 21st centuries; and (iii)
function without error or interruption related to or caused by Date Data. For
the purposes of this Agreement, the term "Date Data" means data which represents
or references dates in the same and/or different centuries. The Company has made
reasonable inquiries of its key vendors and suppliers with respect to whether
their information systems are Millennium Compliant and does not believe that any
failure on the part of any vendor or supplier to be Millennium Compliant will
have a Material Adverse Effect on the Company.
SECTION III.24. Related. Except as set forth in Section 3.24 of the
Company Disclosure Schedule, since August 27, 1996, no director, officer,
employee or Affiliate of the Company or any of its subsidiaries (i) has borrowed
any funds from or has outstanding any indebtedness or other obligations to the
Company or any of its subsidiaries, (ii) owns any direct or indirect interest of
any kind in, or is a
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director, officer, employee, Affiliate or associate of, or consultant or lender
to, or borrower from, or has the right to participate in the management,
operations or profits of, any person which is (x) a competitor, supplier,
customer, distributor, lessor, tenant, creditor or debtor of the Company or any
of its subsidiaries, (y) engaged in a business related to the business of the
Company or any of its subsidiaries, or (z) participating in any transaction to
which the Company or any of its subsidiaries is a party, or (iii) is otherwise a
party to any Contract with the Company or any of its subsidiaries.
SECTION III.25. MVE Restaurant Services, Inc. Section 3.25 of the
Company Disclosure Schedule sets forth (i) a true and correct balance sheet of
MVE Restaurant Services, Inc., a Delaware corporation and wholly owned
subsidiary of the Company ("Restaurant Services"), as of December 31, 1998 and
(ii) a list of all full-time employees of Restaurant Services as of the date
hereof. No assets of Restaurant Services material to the conduct of the business
of the Company or the business of any other subsidiary of the Company are
shared.
SECTION 3.26. Full Disclosure. No representation or warranty by the
Company in this Agreement and no statement contained in the Company Disclosure
Schedule contains any untrue statement of a material fact or omits to state a
material fact necessary to make the statements contained therein, in light of
the circumstances in which they are made, not misleading. To the knowledge of
the Company, there is no event or circumstance which the Company has not
disclosed to Parent in writing which would have a Material Adverse Effect on the
Company.
ARTICLE IV
REPRESENTATION AND WARRANTIES
OF PARENT AND SUB
Except as set forth in the disclosure schedule delivered by Parent
to the Company prior to the execution of this Agreement (the "Parent Disclosure
Schedule") (each section of which qualifies the correspondingly numbered
representation and warranty or covenant to the extent specified therein), Parent
and Sub hereby represent and warrant to the Company as follows:
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SECTION IV.1. Organizing. (a) Each of Parent and Sub is a
corporation duly organized, validly existing and in good standing under the Laws
of the State of Delaware and has all requisite corporate power and authority to
own, lease and operate its properties and to carry on its businesses as now
conducted or proposed by Parent to be conducted.
(b) Each of Parent and Sub is duly qualified or licensed and in good
standing to do business in each jurisdiction in which the property owned, leased
or operated by it or the nature of the business conducted by it makes such
qualification or licensing necessary, except where the failure to be so duly
qualified or licensed and in good standing would not have a Material Adverse
Effect on Parent or Sub.
(c) Parent has heretofore delivered to the Company accurate and
complete copies of the certificate of incorporation and bylaws of each of Parent
and Sub as currently in effect.
SECTION IV.2. Authority Relative to This Agreement. (a) Each of
Parent and Sub has all necessary corporate power and authority to execute and
deliver this Agreement and to consummate the transactions contemplated hereby.
No other corporate proceedings on the part of Parent or Sub are necessary to
authorize this Agreement or to consummate the transactions contemplated hereby.
This Agreement has been duly and validly executed and delivered by each of
Parent and Sub and constitutes a valid, legal and binding agreement of each of
Parent and Sub, enforceable against each of Parent and Sub in accordance with
its terms, subject to applicable bankruptcy, insolvency, reorganization,
moratorium and similar laws affecting creditors' rights and remedies generally,
and subject, as to enforceability, to general principles of equity, including
principles of commercial reasonableness, good faith and fair dealing (regardless
of whether enforcement is sought in a proceeding at law or in equity).
(b) The Boards of Directors of Parent and Sub, and Parent as the
sole stockholder of Sub, have in each case by unanimous vote duly and validly
authorized the execution and delivery of this Agreement and the consummation of
the transactions contemplated hereby, and have taken all corporate actions
required to be taken by such Boards of Directors and Parent as the sole
stockholder of Sub for the consummation of the transactions contemplated hereby.
SECTION IV.3. Consents and Approvals; No Violations. Except for
filings, permits, authorizations, consents and approvals as may be required
under, and other applicable requirements of, the HSR Act, the filing and
recordation of the Certificate
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of Merger as required by the DGCL and as otherwise set forth in Section 4.3 to
the Parent Disclosure Schedule, no filing with or notice to, and no permit,
authorization, consent or approval of, any Governmental Entity, or any person
under any Contract to which Parent or Sub is a party or to which any of their
respective properties or assets is subject, is necessary for the execution and
delivery by Parent or Sub of this Agreement or the consummation by Parent or Sub
of the transactions contemplated hereby, except where the failure to obtain such
permits, authorizations, consents or approvals or to make such filings or give
such notice would not be material to Parent or Sub. Neither the execution,
delivery and performance of this Agreement by Parent or Sub nor the consummation
by Parent or Sub of the Transactions contemplated hereby will (i) conflict with
or result in any breach of any provision of the respective certificates of
incorporation or bylaws (or similar governing documents) of Parent or Sub, (ii)
result in a violation or breach of, or constitute (with or without due notice or
lapse of time or both) a default (or give rise to any right of termination,
amendment, cancellation or acceleration or Lien) under, any of the terms,
conditions or provisions of any Contract to which Parent or Sub is a party or by
which either of them or any of their respective properties or assets may be
bound or (iii) violate any Law applicable to Parent or Sub or any of their
respective properties or assets, except in the case of (ii) or (iii) for
violations, breaches or defaults which would not have a Material Adverse Effect
on Parent of Subsidiary.
SECTION IV.4. No Prior Activities. Except for obligations incurred
in connection with its incorporation or organization or the negotiation and
consummation of this Agreement and the transactions contemplated hereby, Sub has
neither incurred any obligation or liability nor engaged in any business or
activity of any type or kind whatsoever or entered into any agreement or
arrangement with any person.
SECTION IV.5. Available Funds. Parent has obtained a letter, dated
on or about the date hereof (the "Commitment Letter"), from The Chase Manhattan
Bank and Chase Securities Inc. (a copy of which has been provided to the
Company) which provides that, subject to the conditions set forth therein, upon
the funding of such Commitment Letter on the Closing Date, Parent will have
sufficient funds to consummate the Merger and to perform all of its obligations
under this Agreement and the transactions contemplated hereby, including,
without limitation, (i) the obligation, if any, to make the Change of Control
Payment (as defined in the Indenture) required to be made by the Company or MVE
pursuant to the Indenture, (ii) the payment in full of the Obligations (as
defined in the Credit Agreement) of the Company and MVE under the Credit
Agreement, dated as of October 17, 1997, by and among MVE and certain of its
Affiliates, the lenders party thereto and BankBoston, N.A., as agent to the
lenders (the "Credit Agreement"), (iii) the obligation to make any payments
required to be made by the Company pursuant to the Senior Subordinated Note
Purchase Agreement, dated as of May 5, 1998, among the
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Company, Exeter Venture Lenders, L.P. and Exeter Equity Partners, L.P. (the
"Subordinated Note Agreement") in connection with the redemption of the notes
issued thereunder pursuant to Section 2.7(b) thereof, and (iv) any payments
required to be made to the holders of the Exeter Warrants to the extent such
holders exercise their put rights pursuant to such warrants.
SECTION IV.6. Brokers. Except for Schroder & Co., Inc., Chase
Securities Inc. and other investment banks retained by Parent in connection with
the financing of the transactions contemplated hereby, no broker, finder or
investment banker is entitled to any brokerage, finder's or other fee or
commission in connection with the transactions contemplated by this Agreement
based upon arrangements made by and on behalf of Parent or Sub or any of their
Affiliates.
ARTICLE V
COVENANTS RELATED TO CONDUCT OF BUSINESS
SECTION V.1. Conduct of Business of the Company. Except as otherwise
specifically provided by this Agreement, during the period from the date hereof
to the Effective Time, the Company will, and will cause each of its subsidiaries
to, conduct its operations in the ordinary and usual course of business
consistent with past practice and use its reasonable best efforts to preserve
intact its current business organizations, preserve its goodwill, keep available
the service of its current officers and employees, maintain all material
properties and assets in customary condition and repair, maintain its books and
records in accordance with past practice, comply in all material respects with
all applicable Laws, and preserve its relationships with customers, suppliers
and others having business dealings with it. Without limiting the generality of
the foregoing, and except as otherwise expressly provided in this Agreement or
in the Company Disclosure Schedule, prior to the Effective Time, neither the
Company nor any of its subsidiaries will, without the prior written consent of
Parent, which consent shall not be unreasonably withheld or delayed:
(a) amend its certificate of incorporation or bylaws or similar
organizational documents;
(b) authorize for issuance, issue, sell, deliver or agree or commit
to issue, sell or deliver (whether through the issuance or granting of options,
warrants, commitments, subscriptions, rights to purchase or otherwise) any stock
of any class or any other securities convertible into or exchangeable for any
stock or any equity equivalents
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(including, without limitation, any stock options or stock appreciation rights),
except for the issuance of shares of Common Stock pursuant to the exercise of
outstanding Company Stock Options described in the Company Disclosure Schedule
or other currently outstanding convertible securities of the Company described
in the Company Disclosure Schedule;
(c) (i) split, combine or reclassify any shares of its capital
stock; (ii) declare, set aside or pay any dividend or other distribution
(whether in cash, stock or property or any combination thereof) in respect of
its capital stock other than the dividend contemplated by Section 6.7 hereof
(iii) make any other actual, constructive or deemed distribution in respect of
any shares of its capital stock or otherwise make any payments to stockholders
in their capacity as such; or (iv) redeem, repurchase or otherwise acquire any
of its securities or any securities of any of its subsidiaries;
(d) adopt a plan of complete or partial liquidation, dissolution,
merger, consolidation, restructuring, recapitalization or other reorganization
of the Company or any of its subsidiaries (other than the Merger);
(e) alter through merger, liquidation, reorganization, restructuring
or in any other fashion its corporate structure or ownership of any subsidiary;
(f) (i) incur or assume any long-term or short-term debt or issue
any debt securities, except for borrowings under existing lines of credit in the
ordinary and usual course of business consistent with past practice, (ii)
assume, guarantee, endorse or otherwise become liable or responsible (whether
directly, contingently or otherwise) for the obligations of any other person,
except in the ordinary and usual course of business consistent with past
practice, and except for obligations of the wholly owned subsidiaries of the
Company; (iii) make any loans, advances or capital contributions to, or
investments in, any other person (other than to the wholly owned subsidiaries of
the Company, provided, however, that in the case of Restaurant Services, the
Company will not make any such loans, advances or capital contributions to the
extent that such loans, advances or capital contributions would exceed amounts
previously budgeted for such purposes (a copy of which budget is set forth as
Section 5.1 of the Company Disclosure Schedule) or customary loans or advances
to employees in the ordinary and usual course of business consistent with past
practice); (iv) pledge or otherwise encumber shares of capital stock of the
Company's subsidiaries; or (v) mortgage or pledge any of its material assets,
tangible or intangible, or create or suffer to exist any material Lien
thereupon;
(g) except as may be required by Law or as specifically provided by
this Agreement, including the provisions of Section 6.5, enter into, adopt or
amend or
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terminate any Employee Benefit Plan or any bonus, profit sharing, compensation,
severance, termination, stock option (except as provided in Section 5.1(b)
above), stock appreciation right, restricted stock, performance unit, stock
equivalent, stock purchase, retirement, deferred compensation, employment,
severance or other employee benefit agreement, or other arrangement for the
benefit of any director, officer or employee, or (except as set forth in Section
5.1(g) of the Company Disclosure Schedule and except for normal increases in the
ordinary and usual course of business consistent with past practice, and except
as required under existing agreements) increase in any manner the compensation
of any director, officer or employee or pay any benefit not required by any
plan, agreement or arrangement as in effect as of the date hereof (including,
without limitation, the granting of stock appreciation rights or performance
units);
(h) acquire, sell, lease or dispose of any assets outside the
ordinary and usual course of business consistent with past practice, enter into
any commitment or transaction outside the ordinary and usual course of business
consistent with past practice or grant any exclusive distribution rights outside
the ordinary and usual course of business consistent with past practice;
(i) except as may be required as a result of a change in Law or in
GAAP, change any of the accounting principles or practices used by it;
(j) revalue in any material respect any of its assets, including,
without limitation, writing down the value of inventory or writing-off notes or
accounts receivable other than in the ordinary and usual course of business
consistent with past practice or as required by GAAP;
(k) acquire (by merger, consolidation, or acquisition of stock or
assets) any corporation, partnership or other business organization or division
thereof or any equity interest therein;
(l) make or revoke any Tax election, or settle or compromise any
material Tax liability or change (or make a request to any taxing authority to
change) any material aspect of its method of accounting for Tax purposes;
(m) pay, discharge or satisfy any claims, liabilities or obligations
(absolute, accrued, asserted or unasserted, contingent or otherwise), other than
the payment, discharge or satisfaction in the ordinary and usual course of
business consistent with past practice of liabilities reflected or reserved
against in the consolidated financial statements of the Company and its
subsidiaries or incurred in the ordinary and usual course of business consistent
with past practice or waive the benefits of, or agree to
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modify in any manner, any confidentiality, standstill or similar agreement to
which the Company or any of its subsidiaries is a party;
(n) enter into any agreement or arrangement that limits or otherwise
restricts the Company or any of its subsidiaries or any successor thereto or
that could, after the Effective Time, limit or restrict the Surviving
Corporation and its Affiliates (including Parent) or any successor thereto, from
engaging or competing in any material line of business or in any geographic
area;
(o) waive, release, grant or transfer any rights of material value
or modify or change in any material respect any existing Contract, other than in
the ordinary course of business consistent with past practice;
(p) enter into any new Contract, or modify or terminate any existing
Contract, except in the ordinary course of business consistent with past
practice, or enter into or modify any Contract between Restaurant Services and
the Company or any of its other subsidiaries other than as contemplated by
Section 6.7 hereof;
(q) settle or compromise any litigation (whether or not commenced
prior to the date of this Agreement) other than settlements or compromises of
litigation with respect to which the amount paid (after giving effect to
insurance proceeds actually received) in settlement or compromise is not
material to the Company;
(r) materially decrease or increase the level of capital
expenditures by the Company and its subsidiaries considered as a whole;
(s) effectuate a "plant closing" or "mass layoff," as those terms
are defined in the Worker Adjustment and Retraining Notification Act of 1988 or
any similar state Law;
(t) except as specifically contemplated by this Agreement, take any
action the taking of which, or omit to take any action the omission of which,
would cause any of the representations or warranties of the Company contained
herein to not continue to be true and correct in all material respects as though
made at and as of the date of such action or omission (except to the extent such
representation or warranty specifically refers to another date); or
(u) take, propose to take, or agree in writing or otherwise to take,
any of the actions described in Sections 5.1(a) through 5.1(t).
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SECTION V.2. Access to Information. (a) Between the date hereof and
the Effective Time, the Company will give Parent and Sub and their authorized
representatives (including counsel, financial advisors and auditors) reasonable
access during normal business hours upon reasonable notice to all officers,
plants, offices, warehouses and other facilities and to all books and records of
the Company and its subsidiaries, will permit Parent and Sub to make such
inspections as Parent and Sub may reasonably require and will cause the
Company's officers and those of its subsidiaries to furnish Parent and Sub with
such financial and operating data and other information with respect to the
business, properties and personnel of the Company and its subsidiaries as Parent
or Sub may from time to time reasonably request, provided that no investigation
pursuant to this Section 5.2 shall affect or be deemed to modify any of the
representations or warranties made by the Company.
(b) Prior to the Effective Time, each of Parent and Sub will hold
and will cause its authorized representatives to hold in confidence all
documents and information concerning the Company and its subsidiaries furnished
to Parent or Sub in connection with the transactions contemplated by this
Agreement pursuant to the terms of that certain Confidentiality Agreement
entered into between the Company and Parent dated November 16, 1998 (the
"Confidentiality Agreement").
SECTION 5.3. Notification of Certain Events. The Company shall give
prompt notice to Parent, and Parent or Sub shall give prompt notice to the
Company, of (i) the occurrence or non-occurrence of any event which causes or is
reasonably likely to cause any representation or warranty of such party
contained in this Agreement to be untrue or inaccurate in any material respect
or any covenant, condition or agreement contained in this Agreement not to be
complied with or satisfied and (ii) any failure of the Company on the one hand,
or Parent or Sub on the other hand, to comply with or satisfy any covenant,
condition or agreement to be complied with or satisfied by it hereunder;
provided, however, that the delivery of any notice pursuant to this Section 5.3
shall not limit or otherwise affect the remedies available hereunder to the
party receiving such notice.
ARTICLE VI
ADDITIONAL AGREEMENTS
SECTION VI.1. Stockholder Consent. Prior to the Effective Time, the
Company will take all action necessary in accordance with applicable law and its
Certificate of Incorporation and By-Laws to cause the stockholders of the
Company to
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approve, by written consent, this Agreement and the Merger and such other
matters as may be necessary to effectuate the transactions contemplated hereby.
The Company will notify all of its stockholders who have not executed such
written consent as to the execution thereof, in such manner as is required by
the DGCL and the Company's Certificate of Incorporation and By-Laws, prior to
the Effective Date. In addition, the Company agrees to immediately notify Parent
in writing upon its receipt of any notices or other communications with respect
to the Dissenting Shares.
SECTION VI.2. Reasonable Best Efforts. (a) Subject to the terms and
conditions of this Agreement, each party will use its reasonable best efforts to
take, or cause to be taken, all actions and to do, or cause to be done, all
things necessary, proper or advisable under applicable Laws to consummate the
Merger and the other transactions contemplated by this Agreement. In furtherance
and not in limitation of the foregoing, each party hereto agrees to make an
appropriate filing of a Notification and Report Form pursuant to the HSR Act
with respect to the transactions contemplated hereby as promptly as practicable
and in any event within ten business days of the date hereof and to supply as
promptly as practicable any additional information and documentary material that
may be requested pursuant to the HSR Act and to use its reasonable best efforts
to take, or cause to be taken, all other actions consistent with this Section
6.2 necessary to cause the expiration or termination of the applicable waiting
periods under the HSR Act as soon as practicable.
(b) Each of Parent and the Company shall, in connection with the
efforts referenced in Section 6.2(a) to obtain all requisite approvals and
authorizations for the transactions contemplated by this Agreement under the HSR
Act or any other Antitrust Law, use its reasonable best efforts to (i) cooperate
in all respects with each other in connection with any filing or submission and
in connection with any investigation or other inquiry, including any proceeding
initiated by a private party; and (ii) keep the other party informed in all
material respects of any material communication received by such party from, or
given by such party to, the Federal Trade Commission (the "FTC"), the Antitrust
Division of the Department of Justice (the "DOJ") or any other Governmental
Entity and of any material communication received or given in connection with
any proceeding by a private party, in each case regarding any of the
transactions contemplated hereby. For purposes of this Agreement, "Antitrust
Law" means the Sherman Act, as amended, the Clayton Act, as amended, the HSR
Act, the Federal Trade Commission Act, as amended, and all other Laws that are
designed or intended to prohibit, restrict or regulate actions having the
purpose or effect of monopolization or restraint of trade or lessening of
competition through merger or acquisition.
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(c) In furtherance and not in limitation of the covenants of the
parties contained in Sections 6.2(a) and (b), each of Parent and the Company
shall use its reasonable best efforts to resolve such objections, if any, as may
be asserted by a Governmental Entity or other person with respect to the
transactions contemplated hereby under any Antitrust Law. In connection with the
foregoing, if any administrative or judicial action or proceeding, including any
proceeding by a private party, is instituted (or threatened to be instituted)
challenging any transaction contemplated by this Agreement as violative of any
Antitrust Law, each of Parent and the Company shall cooperate in all respects
with each other and use its respective reasonable best efforts to contest and
resist any such action or proceeding and to have vacated, lifted, reversed or
overturned any decree, judgment, injunction or other order, whether temporary,
preliminary or permanent, that is in effect and that prohibits, prevents or
restricts consummation of the transactions contemplated by this Agreement. In
connection with the receipt of any necessary approvals under any Antitrust Laws,
none of the Company, Parent, Sub or their respective subsidiaries shall be
required to divest or to hold separate, or otherwise to take or commit to take
any action that limits its freedom of action with respect to, or its ability to
retain, any material businesses, product lines or assets; provided, however,
that the Company agrees to take any action (including the divestiture of any
businesses, product lines or assets) requested by Parent, such actions to be
conditional upon the consummation of the Merger, in order to comply with any
Antitrust Laws or to satisfy any conditions imposed upon the consummation of the
transactions contemplated hereby by the FTC, the DOJ or any other any
Governmental Entity responsible for the enforcement of such Antitrust Laws.
Notwithstanding the foregoing or any other provision of this Agreement, nothing
in this Section 6.2 shall (i) limit a party's right to terminate this Agreement
pursuant to Section 8.1(b) or Section 8.1(c) so long as such party has up to
then complied in all material respects with its obligations under this Section
6.2.
SECTION VI.3. Public Announcements. Each of Parent, Sub and the
Company will consult with one another before issuing any press release or
otherwise making any public statements with respect to the transactions
contemplated by this Agreement, including, without limitation, the Merger, and
shall not issue any such press release or make any such public statement prior
to obtaining the consent of the other party, which consent shall not be
unreasonably withheld, except as may be required by applicable Law or by
obligations pursuant to any listing agreement with the New York Stock Exchange,
as determined by Parent, Sub or the Company, as the case may be. Notwithstanding
anything to the contrary herein, Parent shall have the right to discuss publicly
available information concerning the Company on conference calls or during
meetings with analysts and current or prospective investors or at the conference
sponsored by Schroder & Co., Inc scheduled to take place on or about March 2,
1999.
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SECTION VI.4. Indemnification; Directors' and Officers' Insurance.
(a) From and after the Effective Time, the Surviving Corporation shall, to the
fullest extent permitted by applicable Law, indemnify, defend and hold harmless
each person who is now, or has been at any time prior to the date hereof, or who
becomes prior to the Effective Time, a director or officer of the Company (each
an "Indemnified Party" and, collectively, the "Indemnified Parties") against all
losses, expenses (including reasonable attorneys' fees and expenses), claims,
damages or liabilities or, subject to the proviso of the next succeeding
sentence, amounts paid in settlement, arising out of actions or omissions
occurring at or prior to the Effective Time and whether asserted or claimed
prior to, at or after the Effective Time that are in whole or in part based on,
or arising out of the fact that such person is or was a director or officer of
the Company or any of its subsidiaries, including, without limitation, losses,
expenses, claims, damages or liabilities based on or arising out of or
pertaining to the transactions contemplated by this Agreement except, in the
case of directors who are Affiliated with MVE Investors, LLC or the members
thereof, for Misallocation Claims (as defined in Section 9.1), which shall be
handled in accordance with the provisions of Article IX. In the event of any
such loss, expense, claim, damage or liability (whether or not arising before
the Effective Time) other than, with respect to directors who are Affiliated
with MVE Investors, any loss, expense, claim, damage or liability based on or
arising out of any Misallocation Claim, (i) the Surviving Corporation shall pay
the reasonable fees and expenses of counsel selected by the Indemnified Parties,
which counsel shall be reasonably satisfactory to the Surviving Corporation,
promptly after statements therefor are received and otherwise advance to such
Indemnified Party upon request reimbursement of documented expenses reasonably
incurred, provided, however, that any such reimbursement shall be conditioned
upon receiving an agreement promptly to return such amounts to the Surviving
Corporation if a court of competent jurisdiction ultimately should determine
that indemnification of such person is prohibited by applicable Law, (ii) the
Surviving Corporation will cooperate in the defense of any such matter and (iii)
any determination required to be made with respect to whether an Indemnified
Party's conduct complies with the standards set forth under the DGCL and the
Surviving Corporation's certificate of incorporation or bylaws shall be made by
independent counsel mutually acceptable to the Surviving Corporation and the
Indemnified Party.
(b) For a period of six years after the Effective Time, the
Surviving Corporation shall maintain in effect the policies of directors' and
officers' liability insurance maintained by the Company (or a policy providing
substantially similar coverage) for the benefit of those persons who are covered
by such policies at the Effective Time (with respect to matters occurring prior
to the Effective Time), to the extent that such liability insurance can be
maintained annually at a total cost to the Surviving Corporation not greater
than $200,000; provided that if such insurance cannot
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be so maintained or obtained at such cost, the Surviving Corporation shall
maintain or obtain as much of such insurance as can be so maintained or obtained
at a cost equal to $200,000.
(c) In the event the Surviving Corporation or any of its successors
or assigns (i) consolidates with or merges into any other person and shall not
be the continuing or surviving corporation or entity or such consolidation or
merger or (ii) transfers all or substantially all of its properties and assets
to any person, then and in either such case, proper provision shall be made so
that the successors and assigns of the Surviving Corporation shall assume the
obligations set for in this Section 6.4.
(d) To the fullest extent permitted by Law, from and after the
Effective Time, all rights to indemnification now existing in favor of the
directors and officers of the Company with respect to their activities as such
prior to the Effective Time (other than indemnification of directors Affiliated
with MVE Investors with respect to Misallocation Claims), as provided in the
Company's certificate of incorporation or bylaws, in effect on the date thereof
or otherwise in effect on the date hereof, shall survive the Merger and shall
continue in full force and effect for a period of not less than six years from
the Effective Time, provided, however, that any such reimbursement shall be
conditioned upon receiving an agreement promptly to return such amounts to the
Surviving Corporation if a court of competent jurisdiction ultimately should
determine that indemnification of such person is prohibited by applicable Law.
(e) The provisions of this Section 6.4 are intended to be for the
benefit of, and shall be enforceable by, each Indemnified Party, his or her
heirs and his or her representatives. The Surviving Corporation shall pay for
all costs and fees (including reasonable attorneys' fees and expenses) incurred
by any Indemnified Party in connection with such Indemnified Party enforcing his
or her rights under this Section 6.4 in the event a court of competent
jurisdiction determines that the Surviving Corporation is responsible for
indemnifying such Indemnified Party hereunder.
SECTION VI.5. Employee Matters. (a) The Surviving Corporation will
honor the obligations of the Company and its subsidiaries under the provisions
of each employment, consulting, termination, severance, change in control and
indemnification agreement between and among the Company or any of its
subsidiaries and any current or former officer, director, consultant or employee
of the Company or any of its subsidiaries. During the period from the Effective
Time through December 31, 1999, Parent shall cause the Surviving Corporation and
its successors to maintain for all employees of the Company and its subsidiaries
employee benefit plans, programs, policies and practices in the aggregate no
less favorable than those benefits currently provided to the employees of
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the Company and its subsidiaries.
(b) At the Effective Time, the Company will adopt a severance policy
for the benefit of the employees listed on Section 6.5(b) of the Company
Disclosure Schedule (the "Named Employees"). If the employment of any Named
Employee is terminated by the Company at any time without cause or any Named
Employee resigns for good reason, such Named Employee shall be entitled to the
benefits described on Section 6.5(b) of the Company Disclosure Schedule. Parent
agrees that it will cause the Surviving Corporation to honor all of the
Company's obligations under this Section 6.5(b). For purposes of this Section
6.5(b) only, "good reason" means any resignation following a change in title,
duties or responsibilities without such employee's consent, any reduction in
compensation or benefits from the current compensation and benefits provided to
such employees or a change in location of such employee's principal office or
the place where such employee conducts his principal employment activities, in
each case to a place more than 30 miles from such employee's current principal
office, provided, however, that with respect to any Named Employee who is a
member of senior management and designated as such on Section 6.5(b) of the
Company Disclosure Schedule, good reason shall not include a resignation because
the employee's position changed if such employee was offered a position with the
same or a higher salary and benefits no less favorable than the employee's
current benefits, such offered position has a comparable level of responsibility
and job title and is located within 30 miles of such employee's current
principal office. For purposes of this Section 6.5(b) only, "cause" means (i) a
material breach by the employee of any employment agreement currently in place
between such employee and the Company or any subsidiary of the Company (or, if
no such employment agreement is currently in place, the employee's continuing
failure to comply with the reasonable directives of any person to whom such
employee directly or indirectly reports or the Board of Directors of the Company
after written notice thereof and a period of 10 days to cure such failure) or
(ii) the conviction by the employee of any felony or any other offense involving
misappropriation of a material amount of money or property from the Company.
(c) The provisions of Section 6.5(b) are intended to be for the
benefit of, and may be enforceable by, each of the Named Employees. The
Surviving Corporation shall pay for all costs and fees (including reasonable
attorneys' fees and expenses) incurred by any Named Employee in connection with
such person enforcing his rights under Section 6.5(b) in the event that such
Employee's claim is successful, as determined by a court of competent
jurisdiction.
SECTION VI.6. Obligations of Sub. Subject to Sections 7.1 and 7.2
below, Parent will take all action necessary to cause Sub to perform its
obligations under
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this Agreement and to consummate the Merger on the terms and conditions set
forth in this Agreement.
SECTION VI.7. Distribution. (a) Immediately prior to the Effective
Time, the Company shall make a distribution to the holders of record as of a
date not later than two business days prior to the Effective Time, of the Common
Stock, pro rata in accordance with the relative ownership of shares of Common
Stock, of eighty percent (80%) of the issued and outstanding capital stock of
Restaurant Services then owned by the Company and its subsidiaries, taken as a
whole, or otherwise effect a transfer of such interests to the holders of Common
Stock in a form mutually acceptable to Parent and the Company.
(b) In the event that Restaurant Services offers additional shares
of its capital stock to any person, the Company shall have the right to
participate, pro rata, in any such offering and to participate, pro rata, in any
additional offerings of capital stock of Restaurant Services in order to
maintain its percentage interest in the capital stock of Restaurant Services,
provided that the Company's rights hereunder shall terminate if at any time the
Company fails to participate in any such offering.
(c) The parties acknowledge that Parent, the Company and Restaurant
Services will enter into an agreement (the "Restaurant Services Agreement")
which shall provide (i) that the Company will provide certain transition
services to Restaurant Services for up to one year at the Company's cost, (ii)
that the Company will have the right to designate a member of the Board of
Directors of Restaurant Services for so long as the Company owns at least 10% of
the capital stock of Restaurant Services on a fully-diluted basis (excluding
employee stock options), (iii) that Parent, the Company and their Affiliates
will not compete with Restaurant Services in the business of providing cooking
oil to, retrieving cooking oil from, or storing or circulating cooking oil in
restaurants for a period of ten years, (iv) for the preemptive rights described
in Section 6.7(b) and (v) for mutual indemnity between the Company and
Restaurant Services in respect of any liabilities attributable to such party.
SECTION VI.8. Cooperation in Financing. The Company shall use its
reasonable efforts to assist Parent with Parent's efforts to finance the
transactions contemplated by this Agreement.
SECTION VI.9. Indenture. (a) After the Effective Time, the Surviving
Corporation or MVE shall (i) make the Change in Control Offer and, if necessary,
the Change of Control Payment (both as defined in the Indenture) required to be
made by MVE pursuant to Section 4.14 of the Indenture, and (ii) take any other
additional actions
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required by the Indenture in conjunction with such payments.
(b) In the event Parent desires to make an offer prior to the
Effective Time to redeem the outstanding 12-1/2% Senior Secured Notes Due 2002
of MVE, Inc. (which offer would become effective upon or following the
consummation of the Merger), the Company and its subsidiaries (including without
limitation MVE, Inc.) shall cooperate with Parent with respect thereto.
SECTION VI.10. Subordinated Notes. After the Effective Time, the
Surviving Corporation shall (i) redeem all of the outstanding notes issued under
the Subordinated Note Agreement pursuant to Section 2.7(b) thereto and pay all
accrued and unpaid interest thereon and any premium payable in connection
therewith, and (ii) take any other additional actions required by the Note
Purchase Agreement.
SECTION VI.11. Repayment of Bank Debt. The Surviving Corporation
shall pay in full the Obligations (as defined in the Credit Agreement) of the
Company and MVE under the Credit Agreement.
ARTICLE VII
CONDITIONS TO CONSUMMATION OF THE MERGER
SECTION VII.1. Conditions to Each Party's Obligations to Effect the
Merger. The respective obligations of each party to consummate the transactions
contemplated by this Agreement are subject to the fulfillment at or prior to the
Effective Time of each of the following conditions, any or all of which may be
waived in whole or in part by the party being benefitted thereby, to the extent
permitted by applicable Law:
(a) Any waiting period applicable to the Merger under the HSR Act
shall have expired or early termination thereof shall have been granted without
limitation, restriction or condition and all required consents or approvals
under foreign Antitrust Laws shall have been obtained; and
(b) No temporary restraining order, preliminary or permanent
injunction or other order issued by any Governmental Entity, and no other legal
restraint or prohibition, shall be in effect preventing or prohibiting the
consummation of the Merger.
SECTION VII.2. Additional Conditions to Parent's and Sub's
Obligations
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to Effect the Merger. The obligations of Parent and Sub to consummate the
transactions contemplated by this Agreement are subject to the fulfillment at or
prior to the Effective Time of the following condition, any or all of which may
be waived in whole or in part by Parent and Sub:
(a) The representations and warranties of the Company set forth in
this Agreement shall be true and accurate as of the Effective Time as though
made on or as of such date (except for those representations and warranties that
address matters only as of a particular date or only with respect to a specific
period of time which need only be true and accurate as of such date or with
respect to such period and except for the representation set forth in Section
3.6 hereof which needs only to be true and correct as of the date hereof) and
the Company shall not have failed to perform or comply with any obligation,
agreement or covenant required by this Agreement to be performed or complied
with by it except, in each case where the failure of such representations and
warranties to be true and accurate (without giving effect to any limitation as
to "materiality" or "material adverse effect" set forth therein), or the failure
to perform or comply with such obligations, agreements or covenants, do not,
have a Material Adverse Effect on the Company or a materially adverse effect on
the Company's ability to consummate the Merger or the other transactions
contemplated hereby.
(b) The Company shall have delivered to Parent a certificate signed
by the president of the Company certifying as to the matters described in
Section 7.2(a).
(c) There shall have been no Material Adverse Change since the date
of this Agreement. For purposes hereof, Material Adverse Change means (i)
physical casualty or damage to the assets or property of the Company that
results in a cost to the Company, after taking into account third-party
insurance proceeds which have been or are reasonably likely to be received, of
an amount in excess of $35,000,000 or (ii) a probable reduction, after taking
into account third-party insurance proceeds which have been or are reasonably
likely to be received, in the Company's earnings before interest, taxes,
depreciation and amortization (to be calculated in a manner consistent with the
Financials) of an amount in excess of $7,500,000 in the twelve-month period
following the date on which the event giving rise to the probable reduction
occurs.
(d) There shall have not occurred a material disruption of or
material adverse change in financial, banking or capital market conditions that,
in the reasonable judgment of The Chase Manhattan Bank and Chase Securities
Inc., would materially impair their syndication of the Credit Facilities (as
defined in the Commitment Letter), but only to the extent that, as a result
thereof, The Chase Manhattan Bank and Chase Securities Inc. refuse to provide
the financing contemplated in the Commitment Letter.
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(e) There shall have been delivered to Parent executed copies of (i)
the Indemnification and Warrant Purchase Agreement among Parent, the Company and
the members of MVE Investors in substantially the form of Exhibit A hereto (the
"Indemnification Agreement"), (ii) the Escrow Agreement and (iii) the Restaurant
Services Agreement (which shall contain terms reasonably satisfactory to
Parent).
(f) The Company shall have cancelled or terminated the ACI Warrant
and all agreements with A.C. Israel Enterprises, Inc. and American Securities
Capital Partners, L.P. or their Affiliates without any continuing cost to the
Company.
SECTION VII.3. Additional Conditions to the Company's Obligations to
Effect the Merger. The obligation of the Company to consummate the transactions
contemplated by this Agreement is subject to the fulfillment at or prior to the
Effective Time of each of the following conditions, any or all of which may be
waived in whole or in part by the Company:
(a) The representations and warranties of Parent and Sub set forth
in this Agreement shall be true and accurate as of the Effective Time as though
made on or as of such date (except for those representations and warranties that
address matters only as of a particular date or only with respect to a specific
period of time which need only be true and accurate as of such date or with
respect to such period) and Parent and Sub shall not have failed to perform or
comply with any obligation, agreement or covenant required by this Agreement to
be performed or complied with by them except, in each case where the failure of
such representations and warranties to be true and accurate (without giving
effect to any limitation as to "materiality" or "material adverse effect" set
forth therein), or the failure to perform or comply with such obligations,
agreement or covenants, do not have a Material Adverse Effect on Parent and Sub
or a materially adverse effect on their ability to consummate the Merger;
(b) MVE Investors shall have been merged into Sub pursuant to an
agreement satisfactory to Parent and MVE Investors; provided that if no such
agreement has been executed prior to February 26, 1999, this condition shall be
deemed to have been fulfilled;
(c) Parent and Sub shall have delivered to the Company a certificate
signed by their respective presidents certifying as to the matters described in
Section 7.3(a); and
(d) Parent shall have delivered to the Company executed copies of
(i)
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the Indemnification Agreement, (ii) the Escrow Agreement and (iii) the
Restaurant Services Agreement.
ARTICLE VIII
TERMINATION; AMENDMENT; WAIVER
SECTION VIII.1. Termination. This Agreement may be terminated and
the Merger may be abandoned at any time prior to the Effective Time, whether
before or after approval of matters presented in connection with the Merger by
the stockholders of the Company:
(a) By the mutual written consent of Parent and the Company.
(b) By either of Parent or the Company if any of the conditions
specified in Section 7.1 have not been satisfied as of the date which is 90 days
after the date of execution of this Agreement or if satisfaction of any such
condition is or becomes impossible (other than through the failure of any party
seeking to terminate this Agreement to comply fully with its obligations under
this Agreement).
(c) By either party if the Closing has not occurred (other than
through failure of any party seeking to terminate this Agreement to comply fully
with its obligations under this Agreement) on or before the date which is 90
days from the date of execution of this Agreement, or such later date as the
parties may agree upon.
(d) By the Company:
(i) if any of the conditions specified in Section 7.3 have not
been satisfied as of the date which is 90 days from the date of execution of
this Agreement or if satisfaction of any such condition is or becomes impossible
(other than through the failure of the Company to comply fully with its
obligations under this Agreement) and the Company has not waived such condition
prior to the Effective Time;
(ii) if there shall be a breach by Parent or Sub of any of
their representations, warranties, covenants or agreements contained in this
Agreement and such breach materially adversely affects the Company's ability to
consummate the Merger, which breach cannot or has not been cured within 20 days
after the giving of written notice to Parent.
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(e) By Parent or Sub:
(i) if any of the conditions specified in Section 7.2 have not
been satisfied as of the date which is 90 days from the date of execution of
this Agreement or if satisfaction of any such condition is or becomes impossible
(other then through the failure of Parent or Sub to comply fully with their
obligations under this Agreement) and the Company has not waived such condition
prior to the Effective Time;
(ii) if there shall be a breach by the Company of any of its
representations, warranties, covenants or agreements contained in this Agreement
and such breach or breaches, have a Material Adverse Effect on the Company or
materially adversely affects Parent's ability to consummate the Merger, which
cannot or has not been cured within 20 days after the giving of written notice
to the Company.
SECTION VIII.2. Effect of Termination. In the event of termination
of this Agreement by either the Company or Parent or Sub as provided in Section
8.1, this Agreement shall forthwith become void and have no effect, without any
liability or obligation on the part of Parent, Sub or the Company, other than
the provisions of Section 5.2(b), this Section 8.2, Section 8.3, Section 8.4 and
Article X.
SECTION VIII.3. Fees and Expenses. Except as otherwise provided
herein, all fees and expenses incurred in connection with the Merger, this
Agreement and the transactions contemplated hereby shall be paid by the party
incurring such fees or expenses, whether or not the Merger is consummated.
SECTION VIII.4. Liquidated Damages. (a) Notwithstanding anything to
the contrary in this Agreement, if this Agreement is terminated by Parent or Sub
pursuant to (i) Section 8.1(c) and all of the conditions to the Company's
obligations to effect the Merger have been satisfied, or (ii), Section
8.1(e)(ii), Parent's and Sub's sole and exclusive remedy against the Company
under this Agreement and with respect to the transactions contemplated hereby
shall be to exercise its right to terminate this Agreement and to receive the
payment from the Company, in cash in an amount equal to $15,000,000 as
liquidated damages (and not as a penalty), it being understood that Parent's and
Sub's actual damages in the event of such termination are difficult to ascertain
and that such proceeds represent the parties' best current estimate of such
damages and each party agrees that such estimate is reasonable. The Company
acknowledges that its obligations under this Section 8.4(a) are a material
inducement for Parent and Sub to enter into this Agreement.
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(b) Notwithstanding anything to the contrary in this Agreement, if
this Agreement is terminated by the Company pursuant to (i) Section 8.1(c) and
all of the conditions to the Parent's and Sub's obligations to effect the Merger
have been satisfied, or (ii), Section 8.1(d)(ii), the Company's sole and
exclusive remedy against Parent and Sub under this Agreement and with respect to
the transactions contemplated hereby shall be to exercise its right to terminate
this Agreement and to receive the payment from Parent and Sub, in cash in an
amount equal to $15,000,000 as liquidated damages (and not as a penalty), it
being understood that the Company's actual damages in the event of such
termination are difficult to ascertain and that such proceeds represent the
parties' best current estimate of such damages and each party agrees that such
estimate is reasonable; provided, however, that in the case of termination by
the Company pursuant to (i) above, which termination is based upon the failure
of the condition specified in Section 7.2(d), the amount of liquidated damages
provided for in this Section 8.4(b) shall be $7,500,000. Parent and Sub
acknowledge that their obligations under this Section 8.4(b) are a material
inducement for the Company to enter into this Agreement.
SECTION VIII.5. Amendment. This Agreement may be amended by action
taken by the Company, Parent and Sub at any time before or after approval of the
Merger by the Company Requisite Vote but, after any such approval, no amendment
shall be made which requires the approval of the Company's stockholders under
applicable Law without such approval. This Agreement may not be amended except
by an instrument in writing signed on behalf of the parties hereto.
SECTION VIII.6. Extension; Waiver. At any time prior to the
Effective Time, each party hereto (for these purposes, Parent and Sub shall
together be deemed one party and the Company shall be deemed the other party)
may (i) extend the time for the performance of any of the obligations or other
acts of the other party, (ii) waive any inaccuracies in the representations and
warranties of the other party contained herein or in any document, certificate
or writing delivered pursuant hereto, or (iii) waive compliance by the other
party with any of the agreements or conditions contained herein. Any agreement
on the part of either party hereto to any such extension or waiver shall be
valid only if set forth in an instrument in writing signed on behalf of such
party. The failure of either party hereto to assert any of its rights hereunder
shall not constitute a waiver of such rights.
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ARTICLE IX
SPECIAL INDEMNIFICATION
SECTION IX.1. Special Indemnification. At any time after the
Effective Time and prior to the sixth anniversary of the Effective Time (the
"Holdback Termination Date") the former holders of the Common Stock of the
Company shall indemnify Parent, Surviving Corporation and each of the members of
MVE Investors (the "Members") (each an "Indemnitee" and collectively, the
"Indemnitees") in respect of, and hold them harmless against, any and all debts,
obligations and other Liabilities, monetary damages, fines, fees, penalties,
interest obligations, deficiencies, losses and expenses, including amounts paid
in settlement, interest, court costs, reasonable costs of investigators,
reasonable fees and expenses of attorneys, accountants, financial advisors, and
other expenses, and other expenses of litigation incurred or suffered by the
Indemnitees or any Affiliate thereof ("Damages") arising out of or in connection
with (i) any action, suit or proceeding brought by or on behalf of any holder of
Common Stock challenging or disputing the allocation of the Merger Consideration
among the holders of Common Stock and the Class A Preferred Stock
("Misallocation Claims") and (ii) the lawsuits in the Minnesota District Court
for the First Judicial District (Dakota County) captioned R. Edwin Powell and
Ralph E. Powell Family Ltd. Partnership, Plaintiffs v. MVE Holdings, Inc., MVE,
Inc., CAIRE, Inc., MVE Investors, LLC, A.C. Israel Enterprises, Inc., American
Securities Capital Partners, L.P., Kevin S. Penn, Michael G. Fisch and J. David
O'Halloran, Defendants (Court File No. C5-97-10024) and R. Edwin Powell,
Plaintiff v. MVE Holdings, Inc., Defendant (Court File No. C9-98-6214),
currently consolidated by Order of the court on December 11, 1998, as Case No.
19-C9-98-6214 (collectively, the "Powell Claims").
SECTION IX.2. Method of Asserting Claims. All claims against the
former holders of Common Stock for indemnification by an Indemnitee pursuant to
Section 9.1 ("Indemnity Claims") shall be made in accordance with the provisions
of this Article IX and the Escrow Agreement (as defined below).
SECTION IX.3. Limitations. Notwithstanding anything to the contrary
herein, the aggregate amount of Damages under this Article IX payable by the
former holders of Common Stock shall not exceed the Holdback Amount and the
Indemnitees' sole recourse in respect of the holders of Common Stock shall be to
the Holdback Amount and they shall have no additional rights against the former
holders of Common Stock hereunder.
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SECTION IX.4. Escrow Agreement. The Holdback Amount shall be held
subject to the terms and conditions of this Agreement, pursuant to an escrow
agreement (the "Escrow Agreement") by and among the parties hereto, ACI Capital
I, LLC and an escrow agent to be agreed upon by the parties hereto (the "Escrow
Agent"), in substantially the form attached hereto as Exhibit B. The Holdback
Amount shall be held in an interest-bearing account as provided under the Escrow
Agreement and interest accrued shall be added to the Holdback Amount.
SECTION IX.5. Distribution of Holdback Amount. The remaining portion
of the Holdback Amount shall be distributed, pro rata, to the former holders of
Common Stock on the Holdback Termination Date. Notwithstanding the foregoing,
any holder of Common Stock or, from and after the Effective Time, former holder
of Common Stock, shall be entitled to his pro rata share of the Holdback Amount
if such holder has executed and delivered to the Company a consent/release in
the form attached hereto as Exhibit C.
ARTICLE X
MISCELLANEOUS
SECTION X.1. Nonsurvival of Representations and Warranties. None of
the representations, warranties, covenants and agreements in this Agreement or
in any exhibit, schedule or instrument delivered pursuant to this Agreement
shall survive beyond the Effective Time, except for those covenants and
agreements contained herein and therein that by their terms apply or are to be
performed in whole or in part after the Effective Time including, but not
limited to, Sections 6.4, 6.5, Article IX and this Article X of this Agreement
and the Indemnification Agreement, the Escrow Agreement and the Restaurant
Services Agreement. This Section 10.1 shall not limit any covenant or agreement
of the parties which by its terms contemplates performance after the Effective
Time.
SECTION X.2. Entire Agreement; Assignment. (a) This Agreement and
the Indemnification Agreement, the Escrow Agreement and the Restaurant Services
Agreement constitute the entire agreement between the parties hereto with
respect to the subject matter hereof and thereof and supersede all other prior
or contemporaneous agreements and understandings, both written and oral, between
the parties with respect to
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the subject matter hereof and thereof other than the Confidentiality Agreement.
(b) Neither this Agreement nor any of the rights, interests or
obligations hereunder shall be assigned by operation of Law (including, but not
limited to, by merger or consolidation) or otherwise; provided, however, that
Sub may assign, in its sole discretion, any or all of its rights, interests and
obligations under this Agreement to any direct wholly owned subsidiary of
Parent, but no such assignment shall relieve Parent or Sub of its obligations
hereunder if such assignee does not perform such obligations; provided, further,
Parent may assign its rights and obligations hereunder in connection with a sale
or transfer of all or substantially all of its assets or a merger of Parent with
and into another person; provided, further, Parent may assign its rights
hereunder to any of its creditors. Any assignment in violation of the preceding
sentence shall be void. Subject to the preceding sentence, this Agreement will
be binding upon, inure to the benefit of, and be enforceable by, the parties and
their respective successors and assigns.
SECTION X.3. Notices. All notices, requests, instructions or other
documents to be given under this Agreement shall be in writing and shall be
deemed given, (i) five business days following sending by registered or
certified mail, postage prepaid, (ii) when sent if sent by facsimile; provided
that the fax is promptly confirmed by telephone confirmation thereof, (iii) when
delivered, if delivered personally to the intended recipient and (iv) one
business day following sending by overnight delivery via a national courier
service, and in each case, addressed to a party at the following address for
such party:
if to Parent or to
Sub, to: Chart Industries, Inc.
5885 Landerbrook Drive
Suite 150
Mayfield Heights, Ohio 44124
Attention: Arthur S. Holmes
Facsimile: (440) 753-1451
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with a copy to: Calfee, Halter & Griswold LLP
1400 McDonald Investment Center
800 Superior Avenue
Cleveland, Ohio 44114-2688
Attention: Thomas F. McKee
Facsimile: (216) 241-0816
if to the Company prior
to the Effective Time, to: MVE Holdings, Inc.
3505 County Road 42 West
Burnsville, Minnesota 55306
Attention: General Counsel
Facsimile: (612) 882-5180
with a copy to: Weil, Gotshal & Manges LLP
767 Fifth Avenue
New York, NY 10153
Attention: Stephen Besen, Esq.
Facsimile: (212) 310-8007
or to such other address as the person to whom notice is given may have
previously furnished to the other in writing in the manner set forth above.
SECTION X.4. Governing Law. This Agreement shall be governed by and
construed in accordance with the Laws of the State of Delaware, without giving
effect to the conflict of Law principles thereof.
SECTION X.5. Descriptive Headings. The descriptive headings herein
are inserted for convenience of reference only and are not intended to be part
of or to affect the meaning or interpretation of this Agreement.
SECTION X.6. Parties in Interest. This Agreement shall be binding
upon and inure solely to the benefit of each party hereto and its successors and
permitted assigns, and, except as provided in Sections 6.4 and 6.5, nothing in
this Agreement, express or implied, is intended to or shall confer upon any
other person any rights, benefits or remedies of any nature whatsoever under or
by reason of this Agreement.
SECTION X.7. Severability. The provisions of this Agreement shall be
deemed severable and the invalidity or unenforceability of any provision shall
not affect the validity or enforceability of the other provisions hereof. If any
provision of this
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Agreement, or the application thereof to any person or any circumstance, is
invalid or unenforceable, (a) if necessary, a suitable and equitable provision
shall be substituted therefor in order to carry out, so far as may be valid and
enforceable, the intent and purpose of such invalid or unenforceable provision
and (b) the remainder of this Agreement and the application of such provision to
other persons or circumstances shall not be affected by such invalidity or
unenforceability, nor shall such invalidity or unenforceability affect the
validity or enforceability of such provision, or the application thereof, in any
other jurisdiction.
SECTION X.8. Specific Performance. The parties agree that
irreparable damage would occur in the event that any of the provisions of this
Agreement were not performed in accordance with their specific terms or were
otherwise breached. It is accordingly agreed that the parties shall be entitled
to an injunction or injunctions to prevent breaches of this Agreement and to
enforce specifically the terms and provisions of this Agreement in any court of
the United States located in the State of Delaware or in Delaware state court,
this being in addition to any other remedy to which they are entitled at Law or
in equity. In addition, each of the parties hereto (a) consents to submit itself
to the personal jurisdiction of any federal court located in the State of
Delaware or any Delaware state court in the event any dispute arises out of this
Agreement or any of the transactions contemplated hereby, (b) agrees that it
will not attempt to deny or defeat such personal jurisdiction by motion or other
request for leave from any such court and (c) agrees that it will not bring any
action relating to this Agreement or any of the transactions contemplated hereby
in any court other than a federal or state court sitting in the State of
Delaware.
SECTION X.9. Counterparts. This Agreement may be executed in one or
more counterparts, all of which shall be considered one and the same agreement
and shall become effective when one or more counterparts have been signed by
each of the parties and delivered to the other parties.
SECTION X.10. Interpretation. (a) The words "hereof," "herein" and
"herewith" and words of similar import shall, unless otherwise stated, be
construed to refer to this Agreement as a whole and not to any particular
provision of this Agreement, and article, section, paragraph, exhibit and
schedule references are to the articles, sections, paragraphs, exhibits and
schedules of this Agreement unless otherwise specified. Whenever the words
"include," "includes" or "including" are used in this Agreement, they shall be
deemed to be followed by the words "without limitation." All terms defined in
this Agreement shall have the defined meanings contained herein when used in any
certificate or other document made or delivered pursuant hereto unless otherwise
defined therein. The definitions contained in this Agreement are applicable to
the singular as well
48
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as the plural forms of such terms and to the masculine as well as to the
feminine and neuter genders of such terms. Any agreement, instrument or statute
defined or referred to herein or in any agreement or instrument that is referred
to herein means such agreement, instrument or statute as from time to time,
amended, qualified or supplemented, including (in the case of agreements and
instruments) by waiver or consent and (in the case of statutes) by succession of
comparable successor statutes and all attachments thereto and instruments
incorporated therein. References to a person are also to its permitted
successors and assigns.
(b) The phrases "the date of this Agreement," "the date hereof" and
terms of similar import, unless the context otherwise requires, shall be deemed
to refer to February 16, 1999. The phrase "made available" in this agreement
shall mean that the information referred to has been actually delivered to the
party to whom such information is to be made available.
(c) The parties have participated jointly in the negotiation and
drafting of this Agreement. In the event an ambiguity or question of intent or
interpretation arises, this Agreement shall be construed as if drafted jointly
by the parties and no presumption or burden of proof shall arise favoring or
disfavoring any party by virtue of the authorship of any provisions of this
Agreement.
SECTION X.11. Definitions.
(a) "Affiliate" means, with respect to any person, any other person
controlling, controlled by or under common control with such particular person,
where "control" means the possession, directly or indirectly, of the power to
direct the management and policies of a person whether through the ownership of
voting securities, contract or otherwise.
(b) "beneficial ownership" or "beneficially own" shall have the
meaning provided in Section 13(d) of the Exchange Act and the rules and
regulations thereunder.
(c) "Contract" means any contract, commitment, understanding,
instrument, lease, pledge, mortgage, indenture, note, license, agreement,
purchase or sales order, promise or other arrangement evidencing or creating any
obligation, whether written or oral.
(d) "know" or "knowledge" means, with respect to the Company, (i)
the actual knowledge of Kevin Penn or (ii) the knowledge of John M. Kucharik,
David Hoffman and Lewis Shender after due inquiry of the books and records of
the Company,
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provided, however, that due inquiry shall not require any inquiry of other
employees of the Company or its subsidiaries.
(e) "Law" means any domestic or foreign law, order, writ,
injunction, decree, ordinance, award, stipulation, statute, judicial or
administrative doctrine, rule or regulation entered by a Governmental Entity.
(f) "Material Adverse Effect" means with respect to any entity, any
change, circumstance or effect that, individually or in the aggregate with all
other changes, circumstances and effects, is or is reasonably likely to be
materially adverse to (i) the assets, properties, condition (financial or
otherwise), or results of operations of such entity and its subsidiaries taken
as a whole, other than any change, circumstance or effect relating (w) to the
economy or financial markets in general, (x) changes in general political or
regulatory conditions in the United States or any foreign jurisdictions in which
such entity conducts business, (y) generally to the industries in which such
entity operates and not specifically relating to such entity or (z) to the
announcement or pendency of the Merger or (ii) the ability of such party to
consummate the transactions contemplated by this Agreement.
(g) "Permitted Lien" means Liens for taxes, fees, assessments,
governmental charges or claims that are not due and payable, inchoate mechanics;
warehousemen's, and other statutory Liens incurred in the ordinary course of
business, easements, rights-of-way, restrictions, municipal zoning ordinances,
reservations, permits and similar charges, encumbrances, title defects or other
irregularities and any other Liens that do not materially interfere with the
ordinary course of business of the Company.
(h) "person" means an individual, corporation, limited liability
company, partnership, association, trust, unincorporated organization, other
entity or group (as defined in the Exchange Act).
(i) "subsidiary" means, when used with reference to any entity, any
corporation or other organization, whether incorporated or unincorporated, (i)
of which such party or any other subsidiary of such party is a general or
managing partner or (ii)
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the outstanding voting securities or interests of, which having by their terms
ordinary voting power to elect a majority of the Board of Directors or others
performing similar functions with respect to such corporation or other
organization, is directly or indirectly owned or controlled by such party or by
any one or more of its subsidiaries.
[signature page follows]
51
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IN WITNESS WHEREOF, each of the parties has caused this Agreement to
be duly executed on its behalf as of the day and year first above written.
CHART INDUSTRIES, INC.
By: /s/ Arthur S. Holmes
-------------------------------------
Name: Arthur S. Holmes
Title: Chairman and CEO
CHART ACQUISITION COMPANY
By: /s/ Arthur S. Holmes
-------------------------------------
Name: Arthur S. Holmes
Title: Chairman and CEO
MVE HOLDINGS, INC.
By: /s/ John M. Kucharik
-------------------------------------
Name: John M. Kucharik
Title: President and CEO
52
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================================================================================
AGREEMENT AND PLAN OF MERGER
dated as of February 25, 1999
among
CHART INDUSTRIES, INC.,
CHART ACQUISITION COMPANY
and
MVE INVESTORS LLC
================================================================================
<PAGE>
Page
TABLE OF CONTENTS
ARTICLE I
THE MERGER....................................... 1
SECTION 1.1. The Merger....................................... 1
SECTION 1.2. Closing.......................................... 2
SECTION 1.3. Effective Time................................... 2
SECTION 1.4. Effects of the Merger............................ 2
SECTION 1.5. Certificate of Incorporation; By-laws............ 2
SECTION 1.6. Directors........................................ 3
SECTION 1.7. Officers......................................... 3
ARTICLE II
EFFECT OF THE MERGER ON THE SECURITIES
OF THE CONSTITUENT ENTITIES....................... 3
SECTION 2.1. Effect on Ownership Interests..................... 3
SECTION 2.2. Payment........................................... 4
SECTION 2.3. No Further Ownership Rights in the Company........ 4
ARTICLE III
REPRESENTATIONS AND WARRANTIES
OF THE COMPANY................................... 4
SECTION 3.1. Organization and Qualification; Subsidiaries..... 4
SECTION 3.2. Members.......................................... 5
SECTION 3.3. Authority Relative to This Agreement; Member
Approval..................................... 5
SECTION 3.4. No Liabilities................................... 5
SECTION 3.5. Consents and Approvals; No Violations............ 5
SECTION 3.6. Class A Preferred Stock.......................... 6
SECTION 3.7. Litigation....................................... 6
SECTION 3.8. Compliance with Laws............................. 6
SECTION 3.9. No Employees..................................... 6
SECTION 3.10. Company Activities............................... 6
SECTION 3.11. No Assets........................................ 6
SECTION 3.12. Net Worth........................................ 7
SECTION 3.13. Tax Status....................................... 7
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SECTION 3.14. Brokers......................................... 7
SECTION 3.15. Full Disclosure................................. 7
ARTICLE IV
REPRESENTATION AND WARRANTIES
OF PARENT AND SUB................................ 7
SECTION 4.1. Organization..................................... 7
SECTION 4.2. Authority Relative to This Agreement............. 8
SECTION 4.3. Consents and Approvals; No Violations............ 8
SECTION 4.4. No Prior Activities.............................. 9
ARTICLE V
COVENANTS RELATED TO CONDUCT OF BUSINESS......... 9
SECTION 5.1. Conduct of Business of the Company............... 9
SECTION 5.2. Access to Information............................ 10
ARTICLE VI
ADDITIONAL AGREEMENTS............................ 11
SECTION 6.1. Member Consent................................... 11
SECTION 6.2. Reasonable Best Efforts.......................... 11
SECTION 6.3. Public Announcements............................. 13
SECTION 6.4. Indemnification of Parent and Surviving
Company...................................... 13
SECTION 6.5. Obligations of Sub............................... 15
ARTICLE VII
CONDITIONS TO CONSUMMATION OF THE MERGER......... 15
SECTION 7.1. Conditions to Each Party's Obligations
to Effect the Merger......................... 15
SECTION 7.2. Additional Conditions to Parent's and
Sub's Obligations to Effect the Merger....... 16
SECTION 7.3. Additional Conditions to the Company's
Obligations to Effect the Merger............. 16
ii
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ARTICLE VIII
TERMINATION; AMENDMENT; WAIVER................... 17
SECTION 8.1. Termination...................................... 17
SECTION 8.2. Effect of Termination............................ 17
SECTION 8.3. Fees and Expenses................................ 17
SECTION 8.4. Amendment........................................ 17
SECTION 8.5. Extension; Waiver................................ 17
ARTICLE IX
MISCELLANEOUS.................................... 18
SECTION 9.1. Nonsurvival of Representations and Warranties.... 18
SECTION 9.2. Entire Agreement; Assignment..................... 18
SECTION 9.3. Notices.......................................... 19
SECTION 9.4. Governing Law.................................... 19
SECTION 9.5. Descriptive Headings............................. 20
SECTION 9.6. Parties in Interest.............................. 20
SECTION 9.7. Severability..................................... 20
SECTION 9.8. Specific Performance............................. 20
SECTION 9.9. Counterparts..................................... 21
SECTION 9.10. Interpretation.................................. 21
SECTION 9.11. Definitions..................................... 22
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Page
Glossary of Defined Terms
Defined Terms Defined in Section
- ------------- ------------------
Antitrust Law.....................................................6.2(b)
Certificate of Merger................................................1.3
Closing..............................................................1.2
Code................................................................3.13
Company.........................................................Recitals
Confidentiality Agreement.........................................5.2(b)
DGCL.................................................................1.1
DLLCA................................................................1.1
DOJ...............................................................6.2(b)
Effective Time.......................................................1.3
FTC...............................................................6.2(b)
Governmental Entity..................................................3.5
HSR Act..............................................................3.5
Liens................................................................3.6
Material Adverse Effect..........................................9.11(e)
Merger..............................................................p. 1
Merger Consideration..............................................2.1(b)
Parent..........................................................Recitals
Preferred Stock...................................................2.1(b)
subsidiary.......................................................9.11(g)
Surviving Company....................................................1.1
iv
<PAGE>
AGREEMENT AND PLAN OF MERGER (this "Agreement") dated as of February
25, 1999 among CHART INDUSTRIES, INC., a Delaware corporation ("Parent"), Chart
Acquisition Company, a Delaware corporation and wholly owned subsidiary of
Parent ("Sub"), and MVE INVESTORS LLC, a Delaware limited liability company (the
"Company").
W I T N E S S E T H :
WHEREAS, the Boards of Directors of Parent and Sub and the Members
of the Company have adopted resolutions approving this Agreement, pursuant to
which the Company shall be merged with and into Sub and Sub shall remain a
wholly owned direct subsidiary of Parent (the "Merger"), and has determined that
the Merger would be fair and in the best interests of the stockholders of Parent
and the members of the Company; and
WHEREAS, Parent, Sub and MVE Holdings, Inc., a Delaware corporation
("Holdings"), have entered into an Agreement and Plan of Merger dated February
16, 1999 (the "Holdings Merger Agreement"), whereby immediately following the
consummation of the Merger, Sub will merge with and into Holdings (the "Holdings
Merger");
WHEREAS, Parent, Sub and the Company desire to make certain
representations, warranties, covenants and agreements in connection with the
Merger and also to prescribe various conditions to the Merger;
NOW, THEREFORE, in consideration of the representations, warranties,
covenants and agreements contained in this Agreement, the parties agree as
follows:
ARTICLE I
THE MERGER
SECTION I.1. The Merger. Upon the terms and subject to the
conditions set forth in this Agreement, and in accordance with the Delaware
General Corporation Law (the
1
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"DGCL") and the Delaware Limited Liability Company Act (the "DLLCA"), the
Company shall be merged with and into Sub at the Effective Time (as hereinafter
defined). At the Effective Time, the separate existence of the Company shall
cease, and Sub shall continue as the surviving corporation (the "Surviving
Company").
SECTION I.2. Closing. Unless this Agreement shall have been
terminated and the transactions herein contemplated shall have been abandoned
pursuant to Section 8.1 and subject to the satisfaction or waiver of the
conditions set forth in Article VII, the consummation of the Merger (the
"Closing") will take place at 9 a.m., on the date (the "Closing Date") on which
the Holdings Merger is consummated, at the offices of Weil, Gotshal & Manges
LLP, 767 Fifth Avenue, New York, New York, unless another date, time or place is
agreed to in writing by the parties hereto.
SECTION I.3. Effective Time. The parties hereto will file with the
Secretary of State of the State of Delaware (the "Delaware Secretary of State")
on the Closing Date (or on such other date as Parent and the Company may agree)
a certificate of merger (the "Certificate of Merger") or other appropriate
documents, executed in accordance with the relevant provisions of the DGCL and
the DLLCA, and make all other filings or recordings required under the DGCL and
the DLLCA in connection with the Merger. The Merger shall become effective upon
the filing of the Certificate of Merger with the Delaware Secretary of State, or
at such later time as is specified in the Certificate of Merger (the "Effective
Time").
SECTION I.4. Effects of the Merger. The Merger shall have the
effects set forth in Section 264 of the DGCL and Section 18-209 of the DLLCA.
Without limiting the generality of the foregoing, and subject thereto, at the
Effective Time, all the properties, rights, privileges, powers and franchises of
the Company and Sub shall vest in the Surviving Company, and all debts,
liabilities and duties of the Company and Sub shall become the debts,
liabilities and duties of the Surviving Company.
SECTION I.5. Certificate of Incorporation; By-laws. (a) At the
Effective Time, Sub's Certificate of Incorporation shall be the Certificate of
Incorporation of the Surviving Company.
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(b) The By-laws of Sub as in effect at the Effective Time shall,
from and after the Effective Time, be the By-laws of the Surviving Company until
thereafter changed or amended as provided therein or by applicable law.
SECTION I.6. Directors. The directors of Sub at the Effective Time
shall, from and after the Effective Time, become the directors of the Surviving
Company, until the earlier of their resignation or removal or until their
respective successors are duly elected and qualified, as the case may be.
SECTION I.7. Officers. At the Effective Time, the officers of Sub
shall be the officers of the Surviving Company, until the earlier of their
resignation or removal or until their respective successors are duly elected and
qualified, as the case may be.
ARTICLE II
EFFECT OF THE MERGER ON THE SECURITIES OF THE CONSTITUENT
ENTITIES
SECTION II.1. Effect on Ownership Interests. As of the Effective
Time, by virtue of the Merger and without any action on the part of the members
of the Company (the "Members") or the holders of any shares of capital stock of
Sub:
(a) Common Stock of Sub. Each share of common stock of Sub issued
and outstanding immediately prior to the Effective Time shall remain outstanding
from and after the Effective Time.
(b) Conversion of Company Membership Interests. The Membership
Interests (as defined in the Limited Liability Company Agreement of the Company
(the "LLC Agreement")) of the Company shall be converted into the right to
receive an amount equal to the Liquidation Preference (as defined in the
Certificate of Designation of Holdings, dated August 26, 1996, with respect to
the 12 1/2% Class A Cumulative Convertible Participating Preferred Stock, par
value $100.00 per share, of Holdings (the "Class A Preferred Stock")), plus any
accrued but unpaid dividends thereon as of the Effective Time multiplied by
4,700, the number of shares of Class A Preferred Stock outstanding as of the
Effective Time, minus $400,000, net to the holder in cash, without interest (the
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<PAGE>
"Merger Consideration").
SECTION II.2. Payment. At or immediately after the Effective Time
but not later than the Effective Time of the Holdings Merger, Parent shall pay
to the Members or a designee chosen by the Members, pro rata in proportion to
their respective Percentage Interests (as defined in the LLC Agreement and as
set forth on Exhibit A hereto), by wire transfer of immediately available funds,
the Merger Consideration.
SECTION II.3. No Further Ownership Rights in the Company. The Merger
Consideration paid in accordance with the terms of this Article II shall be
deemed to have been paid in full satisfaction of all rights pertaining to the
Company.
ARTICLE III
REPRESENTATIONS AND WARRANTIES
OF THE COMPANY
The Company hereby represents and warrants to each of Parent and Sub
as follows:
SECTION III.1. Organization and Qualification; Subsidiaries. (a) The
Company is a limited liability company duly organized, validly existing and in
good standing under the Laws of the State of Delaware and has all requisite
power and authority to own, lease and operate its properties and to carry on its
businesses as now conducted and proposed by the Company to be conducted.
(b) Except for the ownership of the Class A Preferred Stock, the
Company does not own, directly or indirectly, beneficially or of record, any
shares of capital stock or other securities of any other entity or any other
investment in any other entity.
(c) The Company is duly qualified or licensed and in good standing
to do business in each jurisdiction in which the property owned, leased or
operated by it or the nature of the business conducted by it makes such
qualification or licensing necessary.
(d) The Company has heretofore delivered to Parent accurate and
complete copies of the Certificate of
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Formation of the Company and the LLC Agreement.
SECTION III.2. Members. Exhibit A hereto sets forth a list of all of
the Members of the Company and their respective Percentage Interests and all of
the managers of the Company (the "Managers"). There are no outstanding options,
warrants, subscriptions or other rights or agreements providing for the issuance
or sale of any Membership Interests or other ownership interests in the Company.
The Company is not required to repurchase, redeem or otherwise acquire or make
any payment in respect of the Membership Interests. Other than Holdings, the
Company does not have any subsidiaries.
SECTION III.3. Authority Relative to This Agreement; Member
Approval. The Company has all necessary power and authority to execute and
deliver this Agreement and to consummate the transactions contemplated hereby
(other than the approval of the Members referred to in Section 6.1 below). No
other proceedings on the part of the Company are necessary to authorize this
Agreement or to consummate the transactions contemplated hereby. This Agreement
has been duly and validly executed and delivered by the Company and constitutes
a valid, legal and binding agreement of the Company, enforceable against the
Company in accordance with its terms, subject to applicable bankruptcy,
insolvency, reorganization, moratorium and similar laws affecting creditors'
rights and remedies generally and subject, as to enforceability, to general
principles of equity, including principles of commercial reasonableness, good
faith and fair dealing (regardless of whether enforcement is sought in a
proceeding at law or in equity).
SECTION III.4. No Liabilities. Except for the Powell Claims (as
defined in the Holdings Merger Agreement), the Company has no liabilities or
obligations of any nature, whether or not accrued, contingent or otherwise, and
whether due or to become due or asserted or unasserted.
SECTION III.5. Consents and Approvals; No Violations. Except for
filings, permits, authorizations, consents and approvals as may be required
under, and other applicable requirements of, the Hart-Scott-Rodino Antitrust
Improvements Act of 1976, as amended (the "HSR Act"), and the filing and
recordation of the Certificate of Merger as required by the DLLCA and the DGCL,
no filing with or notice to, and no permit, authorization, consent or approval
of, any
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United States or foreign court or tribunal or administrative, governmental or
regulatory body, agency or authority (a "Governmental Entity") or any person
under any Contract to which the Company is a party or to which any of its
properties or assets is subject, is necessary for the execution and delivery by
the Company of this Agreement or the consummation by the Company of the
transactions contemplated hereby. Neither the execution, delivery and
performance of this Agreement by the Company nor the consummation by the Company
of the transactions contemplated hereby will (i) conflict with or result in any
breach of any provision of the Certificate of Formation of the Company or the
LLC Agreement, (ii) result in a violation or breach of, or constitute (with or
without due notice or lapse of time or both) a default (or give rise to any
right of termination, amendment, cancellation or acceleration or Lien) under,
any of the terms, conditions or provisions of any Contract to which the Company
is a party or by which it or any of its properties or assets may be bound, or
(iii) violate any Law applicable to the Company or any of its properties or
assets.
SECTION III.6. Class A Preferred Stock. The Company has good,
marketable and valid title in and to the Class A Preferred Stock, free and clear
of any liens, claims, charges, encumbrances, restrictions or limitations
("Liens").
SECTION III.7. Litigation. There is no suit, claim, action,
proceeding or investigation pending or, to the Company's knowledge, threatened
against the Company or its properties or assets. The Company is not subject to
any outstanding order, writ, injunction or decree.
SECTION III.8. Compliance with Laws. The Company is in compliance
with all applicable Laws.
SECTION III.9. No Employees. The Company has no employees.
SECTION III.10. Company Activities. The Company has not been and is
not engaged in any activities other than the purchase and ownership of the Class
A Preferred Stock and activities incident thereto and the maintenance of its
existence and good standing.
SECTION III.11. No Assets. Other than the Class A Preferred Stock,
the Company has no assets whatsoever.
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SECTION III.12. Net Worth. (i) The Members collectively owned all of
the membership interests of the Company during the period of time from January
1, 1999 until the date hereof and (ii) the aggregate net worth of the Members as
of the date hereof is not less than $50,000,000.
SECTION III.13. Tax Status. The Company is currently treated as a
partnership for Federal tax purposes. The Company is not a publicly traded
limited partnership under the Internal Revenue Code of 1986, as amended.
SECTION III.14. Brokers. No broker, finder or investment banker is
entitled to any brokerage, finder's or other fee or commission or expense
reimbursement in connection with the transactions contemplated by this Agreement
based upon arrangements made by and on behalf of the Company or any of its
Members.
SECTION III.15. Full Disclosure. No representation or warranty by
the Company in this Agreement contains any untrue statement of a material fact
or omits to state a material fact necessary to make the statements contained
herein, in light of the circumstances in which they are made, not misleading.
ARTICLE IV
REPRESENTATION AND WARRANTIES
OF PARENT AND SUB
Parent and Sub hereby represent and warrant to the Company as
follows:
SECTION IV.1. Organization. (a) Each of Parent and Sub is a
corporation duly organized, validly existing and in good standing under the Laws
of the State of Delaware and has all requisite corporate power and authority to
own, lease and operate its properties and to carry on its businesses as now
conducted or proposed by Parent to be conducted.
(b) Each of Parent and Sub is duly qualified or licensed and in good
standing to do business in each jurisdiction in which the property owned, leased
or operated by it or the nature of the business conducted by it makes such
qualification or licensing necessary, except where the failure to be so duly
qualified or licensed and in good
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standing does not and would not reasonably be expected to have, individually or
in the aggregate, a Material Adverse Effect on Parent.
SECTION IV.2. Authority Relative to This Agreement. (a) Each of
Parent and Sub has all necessary corporate or other power and authority to
execute and deliver this Agreement and to consummate the transactions
contemplated hereby. No other corporate or other proceedings on the part of
Parent or Sub are necessary to authorize this Agreement or to consummate the
transactions contemplated hereby. This Agreement has been duly and validly
executed and delivered by each of Parent and Sub and constitutes a valid, legal
and binding agreement of each of Parent and Sub, enforceable against each of
Parent and Sub in accordance with its terms, subject to applicable bankruptcy,
insolvency, reorganization, moratorium and similar laws affecting creditors'
rights and remedies generally, and subject, as to enforceability, to general
principles of equity, including principles of commercial reasonableness, good
faith and fair dealing (regardless of whether enforcement is sought in a
proceeding at law or in equity).
(b) The Board of Directors of each of Parent and Sub, and Parent as
the sole stockholder of Sub, have duly and validly authorized the execution and
delivery of this Agreement and the consummation of the transactions contemplated
hereby, and have taken all corporate or other actions required to be taken by
such Boards of Directors and Parent as the sole stockholder of Sub for the
consummation of the transactions contemplated hereby.
SECTION IV.3. Consents and Approvals; No Violations. Except for
filings, permits, authorizations, consents and approvals as may be required
under, and other applicable requirements of, the HSR Act, and the filing and
recordation of the Certificate of Merger as required by the DLLCA and the DGCL,
no filing with or notice to, and no permit, authorization, consent or approval
of, any Governmental Entity, or any person under any Contract to which Parent or
Sub is a party or to which any of their respective properties or assets is
subject, is necessary for the execution and delivery by Parent or Sub of this
Agreement or the consummation by Parent or Sub of the transactions contemplated
hereby. Neither the execution, delivery and performance of this Agreement by
Parent or Sub nor the consummation by Parent or Sub of the transactions
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contemplated hereby will (i) conflict with or result in any breach of any
provision of the respective certificates of incorporation or bylaws (or similar
governing documents) of Parent or any of Parent's subsidiaries, (ii) result in a
violation or breach of, or constitute (with or without due notice or lapse of
time or both) a default (or give rise to any right of termination, amendment,
cancellation or acceleration or Lien) under, any of the terms, conditions or
provisions of any Contract to which Parent or Sub is a party or by which any of
them or any of their respective properties or assets may be bound or (iii)
violate any Law applicable to Parent or Sub or any of their respective
properties or assets, except in the case of (ii) or (iii) for violations,
breaches or defaults which do not or would not reasonably be expected to have,
individually or in the aggregate, a Material Adverse Effect on Parent.
SECTION IV.4. No Prior Activities. Except for obligations incurred
in connection with its formation or organization or the negotiation and
consummation of this Agreement and the Holdings Merger Agreement and the
transactions contemplated hereby and thereby, Sub has neither incurred any
obligation or liability nor engaged in any business or activity of any type or
kind whatsoever or entered into any agreement or arrangement with any person.
ARTICLE V
COVENANTS RELATED TO CONDUCT OF BUSINESS
SECTION V.1. Conduct of Business of the Company. During the period
from the date hereof to the Effective Time, the Company will conduct its
operations in the ordinary and usual course of business consistent with past
practice. Without limiting the generality of the foregoing, except as otherwise
expressly provided in this Agreement prior to the Effective Time, the Company
will not, without the prior written consent of Parent, which consent shall not
be unreasonably withheld or delayed:
(a) amend its Certificate of Formation or the LLC Agreement;
(b) authorize for issuance, issue, sell, deliver or agree or commit
to issue, sell or deliver any interests in the Company;
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(c) make any distributions or other payments to its Members;
(d) adopt a plan of complete or partial liquidation, dissolution,
merger, consolidation, restructuring, recapitalization or other reorganization
of the Company or any of its subsidiaries (other than the Merger or the
transactions contemplated by the Holdings Merger Agreement);
(e) alter through merger, liquidation, reorganization, restructuring
or in any other fashion the ownership of the Company;
(f) incur or assume any obligations or liabilities (other than
obligations or liabilities incurred in connection with maintaining its existence
and good standing in the State of Delaware);
(g) employ any person;
(h) acquire, sell, lease or dispose of any assets;
(i) enter into any agreement or arrangement that limits or otherwise
restricts the Company or any of its subsidiaries or any successor thereto or
that could, after the Effective Time, limit or restrict the Surviving Company or
any of its Affiliates (including Parent) or any successor thereto, from engaging
or competing in any line of business or in any geographic area;
(j) conduct any business or engage in any activities other than as
required to continue its ownership interest in Holdings; or
(k) take, propose to take, or agree in writing or otherwise to take,
any of the actions described in Sections 5.1(a) through 5.1(j).
SECTION V.2. Access to Information. (a) Between the date hereof and
the Effective Time, the Company will give Parent and Sub and their authorized
representatives (including counsel, financial advisors and auditors) reasonable
access during normal business hours upon reasonable notice to all Members,
plants, offices, warehouses
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and other facilities and to all books and records of the Company, will permit
Parent and Sub to make such inspections as Parent and Sub may reasonably require
and will cause the Company's officers to furnish Parent and Sub with such
financial and operating data and other information with respect to the business,
properties and personnel of the Company as Parent or Sub may from time to time
reasonably request, provided that no investigation pursuant to this Section
5.2(a) shall affect or be deemed to modify any of the representations or
warranties made by the Company.
(b) Prior to the Effective Time, each of Parent and Sub will hold
and will cause their authorized representatives to hold in confidence all
documents and information concerning the Company and its subsidiaries furnished
to Parent or Sub in connection with the transactions contemplated by this
Agreement and the Holdings Merger Agreement pursuant to the terms of that
certain Confidentiality Agreement entered into between MVE Holdings and Parent
dated November 16, 1998 (the "Confidentiality Agreement").
ARTICLE VI
ADDITIONAL AGREEMENTS
SECTION VI.1. Member Consent. Prior to the Effective Time, the
Company will take all action necessary in accordance with applicable Law and the
LLC Agreement to cause the Members to approve, by written consent, this
Agreement and the Merger and such other matters as may be necessary to
effectuate the transactions contemplated hereby.
SECTION VI.2. Reasonable Best Efforts. (a) Subject to the terms and
conditions of this Agreement, each party will use its reasonable best efforts to
take, or cause to be taken, all actions and to do, or cause to be done, all
things necessary, proper or advisable under applicable Laws to consummate the
Merger and the other transactions contemplated by this Agreement. In furtherance
and not in limitation of the foregoing, each party hereto agrees to supply as
promptly as practicable any information and documentary material that may be
requested pursuant to the HSR Act and use its reasonable best efforts to take,
or cause to be taken, all other actions consistent with this Section 6.2
necessary to cause the expiration or termination
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of the applicable waiting periods under the HSR Act as soon as practicable.
(b) Each of Parent and the Company shall, in connection with the
efforts referenced in Section 6.2(a) to obtain all requisite approvals and
authorizations for the transactions contemplated by this Agreement under the HSR
Act or any other Antitrust Law, use its reasonable best efforts to (i) cooperate
in all respects with each other in connection with any filing or submission and
in connection with any investigation or other inquiry, including any proceeding
initiated by a private party; and (ii) keep the other party informed in all
material respects of any material communication received by such party from, or
given by such party to, the Federal Trade Commission (the "FTC"), the Antitrust
Division of the Department of Justice (the "DOJ") or any other Governmental
Entity and of any material communication received or given in connection with
any proceeding by a private party, in each case regarding any of the
transactions contemplated hereby. For purposes of this Agreement, "Antitrust
Law" means the Sherman Act, as amended, the Clayton Act, as amended, the HSR
Act, the Federal Trade Commission Act, as amended, and all other Laws that are
designed or intended to prohibit, restrict or regulate actions having the
purpose or effect of monopolization or restraint of trade or lessening of
competition through merger or acquisition.
(c) In furtherance and not in limitation of the covenants of the
parties contained in Sections 6.2(a) and (b), each of Parent and the Company
shall use its reasonable best efforts to resolve such objections, if any, as may
be asserted by a Governmental Entity or other person with respect to the
transactions contemplated hereby under any Antitrust Law. In connection with the
foregoing, if any administrative or judicial action or proceeding, including any
proceeding by a private party, is instituted (or threatened to be instituted)
challenging any transaction contemplated by this Agreement as violative of any
Antitrust Law, each of Parent and the Company shall cooperate in all respects
with each other and use its respective reasonable best efforts to contest and
resist any such action or proceeding and to have vacated, lifted, reversed or
overturned any decree, judgment, injunction or other order, whether temporary,
preliminary or permanent, that is in effect and that prohibits, prevents or
restricts consummation of the transactions contemplated by this Agreement. In
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connection with the receipt of any necessary approvals under any Antitrust Laws,
none of the Company, Parent, Sub or their respective subsidiaries shall be
required to divest or to hold separate, or otherwise to take or commit to take
any action that limits its freedom of action with respect to, or its ability to
retain, any material businesses, product lines or assets; provided, however,
that the Company agrees to take any action requested by Parent, such actions to
be conditional upon the consummation of the Merger and the Holdings Merger, in
order to comply with any Antitrust Laws or to satisfy any conditions imposed
upon the consummation of the transactions contemplated hereby by the FTC, the
DOJ or any other Governmental Entity responsible for the enforcement of such
Antitrust Laws. Notwithstanding the foregoing or any other provision of this
Agreement, nothing in this Section 6.2 shall limit a party's right to terminate
this Agreement pursuant to Section 8.1 so long as such party has up to then
complied in all material respects with its obligations under this Section 6.2.
SECTION VI.3. Public Announcements. Each of Parent, Sub and the
Company will consult with one another before issuing any press release or
otherwise making any public statements with respect to the transactions
contemplated by this Agreement, including, without limitation, the Merger, and
shall not issue any such press release or make any such public statement prior
to obtaining the consent of the other party, which consent shall not be
unreasonably withheld, except as may be required by applicable Law or by
obligations pursuant to any listing agreement with the New York Stock Exchange,
as determined by Parent, Sub or the Company, as the case may be. Notwithstanding
anything to the contrary herein, Parent shall have the right to discuss publicly
available information concerning the Company on conference calls or during
meetings with analysts and current or prospective investors or at the conference
sponsored by Schroder & Co., Inc. scheduled to take place on or about March 2,
1999.
SECTION VI.4. Indemnification of Parent and Surviving Company. (a)
From and after the Effective Time, each of the Members shall jointly and
severally, indemnify, defend and hold harmless Parent and Surviving Company
against all losses, expenses (including reasonable attorneys' fees and
expenses), claims, damages or liabilities or, subject to the proviso of the next
succeeding sentence, amounts paid in settlement (collectively, "Damages"),
arising out of (i) any
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misrepresentation or breach of warranty or covenant made by the Company in this
Agreement or (ii) actions or omissions occurring at or prior to the Effective
Time and whether asserted or claimed prior to, at or after the Effective Time
that are based on, arising out of or pertaining to the operations of the Company
prior to the Effective Time, (including without limitation any amounts paid, and
any fees and expenses incurred, in connection with, the indemnification of any
persons under Section 6.7 of the LLC Agreement, under the Company's Certificate
of Formation or under the DGCL or DLLCA or otherwise, except with respect to
Misallocation Claims to the extent Parent has agreed to provide indemnification
to certain persons under the Indemnification and Warrant Purchase Agreement to
be entered into by and among Parent, Holdings and the Members (the
"Indemnification and Warrant Purchase Agreement"). In the event of any such
Damages (whether or not arising before the Effective Time), (i) the Members
shall pay the reasonable fees and expenses of counsel selected by Parent and the
Surviving Company, which counsel shall be reasonably satisfactory to the
Members, promptly after statements therefor are received and otherwise advance
to Parent and the Surviving Company upon request reimbursement of documented
expenses reasonably incurred and (ii) the Members will cooperate in the defense
of any such matter.
(b) Parent shall give prompt written notification to the Members of
the assertion of any third party claim or commencement of any action, suit or
proceeding relating to a third party claim for which indemnification pursuant to
this Section 6.4 may be sought. Within 20 days after delivery of such
notification, the Members may, upon written notice thereof to Parent, assume
control of the defense of such claim, action, suit or proceeding with counsel
reasonable satisfactory to Parent, provided that the Members acknowledge in
writing, and in form and substance acceptable to Parent, that any Damages that
may be assessed against Parent in connection with such action, suit or
proceeding constitute Damages for which Parent shall be entitled to
indemnification pursuant to this Section 6.4; and provided, further, that Parent
shall have the right to control the defense to the extent of any claim or demand
seeking equitable relief or remedial action on the part of Parent. If the
Members do not so assume control of such defense, Parent shall control such
defense. The party not controlling such defense may participate therein at its
own expense; provided that if the Members assume control of such defense and
Parent reasonably
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concludes that the Members and Parent have a conflict of interest or different
defenses available with respect to such action, suit or proceeding, the
reasonable fees and expenses of counsel to Parent shall be considered "Damages"
for purposes of this Agreement. The party controlling such defense shall keep
the other party advised of the status of such action, suit or proceeding and the
defense thereof and shall consider in good faith recommendations made by the
other party with respect thereto. Parent shall not agree to any settlement of
such claim, action, suit or proceeding without the prior written consent of the
Members, which consent shall not be unreasonably withheld or delayed. The
Members shall not agree to any settlement of such action, suit or proceeding
without the prior written consent of Parent, which consent shall not be
unreasonably withheld or delayed.
SECTION VI.5. Obligations of Sub. Parent will take all action
necessary to cause Sub to perform its obligations under this Agreement and to
consummate the Merger on the terms and conditions set forth in this Agreement.
ARTICLE VII
CONDITIONS TO CONSUMMATION OF THE MERGER
SECTION VII.1. Conditions to Each Party's Obligations to Effect the
Merger. The respective obligations of each party to consummate the transactions
contemplated by this Agreement are subject to the fulfillment at or prior to the
Effective Time of each of the following conditions, any or all of which may be
waived in whole or in part by the party being benefitted thereby, to the extent
permitted by applicable Law:
(a) Any waiting period applicable to the Merger under the HSR Act
shall have expired or early termination thereof shall have been granted without
limitation, restriction or condition and all required consents or approvals
under foreign antitrust Laws shall have been obtained; and
(b) No temporary restraining order, preliminary or permanent
injunction or other order issued by any Governmental Entity, and no other legal
restraint or prohibition, shall be in effect preventing or prohibiting the
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consummation of the Merger.
(c) Each of the conditions set forth in the Holdings Merger
Agreement shall have been fulfilled or waived (other than the condition that the
transactions contemplated by this Agreement shall have been consummated).
SECTION VII.2. Additional Conditions to Parent's and Sub's
Obligations to Effect the Merger. The obligations of Parent and Sub to
consummate the transactions contemplated by this Agreement are subject to the
fulfillment at or prior to the Effective Time of the following condition, which
may be waived in whole or in part by Parent and Sub:
The representations and warranties of the Company set forth in this
Agreement shall be true and accurate in all material respects as of the
Effective Time as though made on or as of such date (except for those
representations and warranties that address matters only as of a particular date
or only with respect to a specific period of time which need only be true and
accurate as of such date or with respect to such period) and the Company shall
not have failed to perform or comply in any material respect with any
obligation, agreement or covenant required by this Agreement to be performed or
complied with by it.
SECTION VII.3. Additional Conditions to the Company's Obligations to
Effect the Merger. The obligation of the Company to consummate the transactions
contemplated by this Agreement is subject to the fulfillment at or prior to the
Effective Time of the following condition, which may be waived in whole or in
part by the Company:
The representations and warranties of Parent and Sub set forth in
this Agreement shall be true and accurate in all material respects as of the
Effective Time as though made on or as of such date (except for those
representations and warranties that address matters only as of a particular date
or only with respect to a specific period of time which need only be true and
accurate as of such date or with respect to such period) and Parent and Sub
shall not have failed to perform or comply in any material respect with any
obligation, agreement or covenant required by this Agreement to be performed or
complied with by it.
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ARTICLE VIII
TERMINATION; AMENDMENT; WAIVER
SECTION VIII.1. Termination. This Agreement may be terminated and
the Merger contemplated herein may be abandoned at any time prior to the
Effective Time:
(a) By the mutual written consent of Parent and the Company.
(b) By either party if the Holdings Merger Agreement is terminated
by any party thereto for any reason.
SECTION VIII.2. Effect of Termination. In the event of termination
of this Agreement by either the Company or Parent or Sub as provided in Section
8.1, this Agreement shall forthwith become void and have no effect, without any
liability or obligation on the part of Parent, Sub or the Company, other than
the provisions of Section 5.2(b), this Section 8.2, Section 8.3 and Article IX,
which shall survive.
SECTION VIII.3. Fees and Expenses. Except as otherwise provided
herein, all fees and expenses incurred in connection with the Merger, this
Agreement and the transactions contemplated hereby shall be paid by the party
incurring such fees or expenses, whether or not the Merger is consummated.
SECTION VIII.4. Amendment. This Agreement may not be amended except
by an instrument in writing signed on behalf of the parties hereto.
SECTION VIII.5. Extension; Waiver. At any time prior to the
Effective Time, each party hereto (for these purposes, Parent and Sub shall
together be deemed one party and the Company shall be deemed the other party)
may (i) extend the time for the performance of any of the obligations or other
acts of the other party, (ii) waive any inaccuracies in the representations and
warranties of the other party contained herein or in any document, certificate
or writing delivered pursuant hereto, or (iii) waive compliance by the other
party with any of the agreements or conditions contained herein. Any agreement
on the part of either party hereto to any such extension or waiver shall be
valid only if set forth in an instrument in writing signed on behalf of such
party. The failure of either party hereto to assert any
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of its rights hereunder shall not constitute a waiver of such rights.
ARTICLE IX
MISCELLANEOUS
SECTION IX.1. Nonsurvival of Representations and Warranties. None of
the representations, warranties, covenants and agreements in this Agreement or
in any exhibit, schedule or instrument delivered pursuant to this Agreement
shall survive beyond the Effective Time, except for those covenants and
agreements contained herein and therein that by their terms apply or are to be
performed in whole or in part after the Effective Time including, but not
limited to, Sections 5.2(b), 6.4 and this Article IX. This Section 9.1 shall not
limit any covenant or agreement of the parties which by its terms contemplates
performance after the Effective Time.
SECTION IX.2. Entire Agreement; Assignment. (a) This Agreement, the
Holdings Merger Agreement and the Indemnification and Warrant Purchase Agreement
constitute the entire agreement between the parties hereto with respect to the
subject matter hereof and thereof and supersede all other prior agreements and
understandings, both written and oral, between the parties with respect to the
subject matter hereof and thereof other than the Confidentiality Agreement.
(b) Neither this Agreement nor any of the rights, interests or
obligations hereunder shall be assigned by operation of Law (including, but not
limited to, by merger or consolidation) or otherwise; provided, however, that
Sub may assign, in its sole discretion, any or all of its rights, interests and
obligations under this Agreement to any direct wholly owned subsidiary of
Parent, but no such assignment shall relieve Parent or Sub of its obligations
hereunder if such assignee does not perform such obligations; provided, further,
Parent may assign its rights and obligations hereunder in connection with a sale
or transfer of all or substantially all of its assets or a merger of Parent with
and into another person; provided, further, Parent may assign its rights
hereunder to any of its creditors. Any assignment in violation of the preceding
sentence shall be void. Subject to the preceding sentence, this Agreement will
be binding upon, inure to the benefit of, and be enforceable by, the parties and
their respective successors and assigns.
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SECTION IX.3. Notices. All notices, requests, instructions or other
documents to be given under this Agreement shall be in writing and shall be
deemed given, (i) five business days following sending by registered or
certified mail, postage prepaid, (ii) when sent if sent by facsimile; provided
that the fax is promptly confirmed by telephone confirmation thereof, (iii) when
delivered, if delivered personally to the intended recipient and (iv) one
business day following sending by overnight delivery via a national courier
service, and in each case, addressed to a party at the following address for
such party:
if to Parent or to
Sub, to: Chart Industries, Inc.
5885 Landerbrook Drive
Suite 150
Mayfield Heights, Ohio 44124
Attention: Arthur S. Holmes
Facsimile: (440) 753-1491
with a copy to: Calfee, Halter & Griswold LLP
1400 McDonald Investment Center
800 Superior Avenue
Cleveland, Ohio 44114-2688
Attention: Thomas F. McKee
Facsimile: (216) 241-0816
if to the Company, to: MVE Investors LLC
707 Westchester Avenue
White Plains, NY 10604
Attention: Kevin Penn
Facsimile: (914) 681-9856
with a copy to: Weil, Gotshal & Manges LLP
767 Fifth Avenue
New York, NY 10153
Attention: Stephen Besen, Esq.
Facsimile: (212) 310-8007
or to such other address as the person to whom notice is given may have
previously furnished to the other in writing in the manner set forth above.
SECTION IX.4. Governing Law. This Agreement shall
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be governed by and construed in accordance with the Laws of the State of
Delaware, without giving effect to the conflict of Law principles thereof.
SECTION IX.5. Descriptive Headings. The descriptive headings herein
are inserted for convenience of reference only and are not intended to be part
of or to affect the meaning or interpretation of this Agreement.
SECTION IX.6. Parties in Interest. This Agreement shall be binding
upon and inure solely to the benefit of each party hereto and its successors and
permitted assigns, and nothing in this Agreement, express or implied, is
intended to or shall confer upon any other person any rights, benefits or
remedies of any nature whatsoever under or by reason of this Agreement.
SECTION IX.7. Severability. The provisions of this Agreement shall
be deemed severable and the invalidity or unenforceability of any provision
shall not affect the validity or enforceability of the other provisions hereof.
If any provision of this Agreement, or the application thereof to any person or
any circumstance, is invalid or unenforceable, (a) if necessary, a suitable and
equitable provision shall be substituted therefor in order to carry out, so far
as may be valid and enforceable, the intent and purpose of such invalid or
unenforceable provision and (b) the remainder of this Agreement and the
application of such provision to other persons or circumstances shall not be
affected by such invalidity or unenforceability, nor shall such invalidity or
unenforceability affect the validity or enforceability of such provision, or the
application thereof, in any other jurisdiction.
SECTION IX.8. Specific Performance. The parties agree that
irreparable damage would occur in the event that any of the provisions of this
Agreement were not performed in accordance with their specific terms or were
otherwise breached. It is accordingly agreed that the parties shall be entitled
to an injunction or injunctions to prevent breaches of this Agreement and to
enforce specifically the terms and provisions of this Agreement in any court of
the United States located in the State of Delaware or in Delaware state court,
this being in addition to any other remedy to which they are entitled at Law or
in equity. In addition, each of the parties hereto (a) consents to submit itself
to the personal jurisdiction of any federal court located in the
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State of Delaware or any Delaware state court in the event any dispute arises
out of this Agreement or any of the transactions contemplated hereby, (b) agrees
that it will not attempt to deny or defeat such personal jurisdiction by motion
or other request for leave from any such court and (c) agrees that it will not
bring any action relating to this Agreement or any of the transactions
contemplated hereby in any court other than a federal or state court sitting in
the State of Delaware.
SECTION IX.9. Counterparts. This Agreement may be executed in one or
more counterparts, all of which shall be considered one and the same agreement
and shall become effective when one or more counterparts have been signed by
each of the parties and delivered to the other parties.
SECTION IX.10. Interpretation. (a) The words "hereof," "herein" and
"herewith" and words of similar import shall, unless otherwise stated, be
construed to refer to this Agreement as a whole and not to any particular
provision of this Agreement, and article, section, paragraph, exhibit and
schedule references are to the articles, sections, paragraphs, exhibits and
schedules of this Agreement unless otherwise specified. Whenever the words
"include," "includes" or "including" are used in this Agreement, they shall be
deemed to be followed by the words "without limitation." All terms defined in
this Agreement shall have the defined meanings contained herein when used in any
certificate or other document made or delivered pursuant hereto unless otherwise
defined therein. The definitions contained in this Agreement are applicable to
the singular as well as the plural forms of such terms and to the masculine as
well as to the feminine and neuter genders of such terms. Any agreement,
instrument or statute defined or referred to herein or in any agreement or
instrument that is referred to herein means such agreement, instrument or
statute as from time to time, amended, qualified or supplemented, including (in
the case of agreements and instruments) by waiver or consent and (in the case of
statutes) by succession of comparable successor statutes and all attachments
thereto and instruments incorporated therein. References to a person are also to
its permitted successors and assigns.
(b) The phrases "the date of this Agreement," "the date hereof" and
terms of similar import, unless the context otherwise requires, shall be deemed
to refer to February 25, 1999. The phrase "made available" in this
21
<PAGE>
agreement shall mean that the information referred to has been actually
delivered to the party to whom such information is to be made available.
(c) The parties have participated jointly in the negotiation and
drafting of this Agreement. In the event an ambiguity or question of intent or
interpretation arises, this Agreement shall be construed as if drafted jointly
by the parties and no presumption or burden of proof shall arise favoring or
disfavoring any party by virtue of the authorship of any provisions of this
Agreement.
SECTION IX.11. Definitions. (a) "Affiliate" means, with respect to
any person, any other person controlling, controlled by or under common control
with such particular person, where "control" means the possession, directly or
indirectly, of the power to direct the management and policies of a person
whether through the ownership of voting securities, by Contract or otherwise.
(b) "beneficial ownership" or "beneficially own" shall have the
meaning provided in Section 13(d) of the and the rules and regulations
thereunder.
(c) "Contract" means any contract, commitment, understanding,
instrument, lease, pledge, mortgage, indenture, note, license, agreement,
purchase or sales order, promise or other arrangement evidencing or creating any
obligation, whether written or oral.
(d) "Law" means any domestic or foreign law, order, writ,
injunction, decree, ordinance, award, stipulation, statute, judicial or
administrative doctrine, rule or regulation entered by a Governmental Entity.
(e) "Material Adverse Effect" means with respect to any entity, any
change, circumstance or effect that, individually or in the aggregate with all
other changes, circumstances and effects, is or is reasonably likely to be
materially adverse to (i) the assets, properties, condition (financial or
otherwise) or results of operations of such entity and its subsidiaries taken as
a whole, other than any change, circumstance or effect relating (x) to the
economy or financial markets in general, (y) changes in general political or
regulatory conditions in the United States or any foreign jurisdictions in which
such entity conducts business, (y) generally to the industries in which such
22
<PAGE>
entity operates and not specifically relating to such entity or (z) to the
announcement or pendency of the Merger or (ii) the ability of such party to
consummate the transactions contemplated by this Agreement.
(f) "person" means an individual, corporation, limited liability
company, partnership, association, trust, unincorporated organization, other
entity or group (as defined in the ).
(g) "subsidiary" means, when used with reference to any entity, any
corporation or other organization, whether incorporated or unincorporated, (i)
of which such party or any other subsidiary of such party is a general or
managing partner or (ii) the outstanding voting securities or interests of,
which having by their terms ordinary voting power to elect a majority of the
Board of Directors or others performing similar functions with respect to such
corporation or other organization, is directly or indirectly owned or controlled
by such party or by any one or more of its subsidiaries.
[signature page follows]
23
<PAGE>
IN WITNESS WHEREOF, each of the parties has caused this Agreement to
be duly executed on its behalf as of the day and year first above written.
CHART INDUSTRIES, INC.
By: /s/ James R. Sadowski
-------------------------------------
Name: James R. Sadowski
Title: President and Chief
Operating Officer
CHART ACQUISITION COMPANY
By: /s/ James R. Sadowski
-------------------------------------
Name: James R. Sadowski
Title: Vice President
MVE INVESTORS LLC
By: /s/ Kevin S. Penn
-------------------------------------
Name: Kevin S. Penn
Title: President, ACI Captial I, LLC
As Manager
<PAGE>
Accepted and Agreed With Respect
to Section 6.5 Only:
ACI CAPITAL I, LLC
By: /s/ Kevin S. Penn
-------------------------------------
Name: Kevin S. Penn
Title: President
AMERICAN SECURITIES PARTNERS, L.P.
By: American Securities Associates, L.P.,
its general partner
By: American Securities Partners GP
(Management) Corp.
By: Authorized Representative
-------------------------------------
Name:
Title:
MVE CRYOGENICS LLC
By: Authorized Representative
-------------------------------------
Name:
Title:
CRM/MVE CAPITAL LLC
By: Cramer Rosenthal McGlynn, Inc.,
as Manager
By: /s/ Eugene A. Trainor
-------------------------------------
Name: Eugene A. Trainor
Title: EVP, COO
<PAGE>
TANGENT LLC
By: Authorized Representative
-------------------------------------
Name:
Title:
FERTOSA LLC
By: Authorized Representative
-------------------------------------
Name:
Title:
BURDEN DIRECT INVESTMENT FUND II
By: William A.M. Burden & Co., L.P.,
its general partner
By: Burden Brothers, Inc.,
its sole general partner
By: /s/ Jeffrey A. Weber
-------------------------------------
Name: Jeffrey A. Weber
Title: President and CEO
<PAGE>
EXECUTION COUNTERPART
- --------------------------------------------------------------------------------
CREDIT AGREEMENT
dated as of
April 12, 1999
between
CHART INDUSTRIES, INC.
The SUBSIDIARY BORROWERS Party Hereto
The SUBSIDIARY GUARANTORS Party Hereto
The LENDERS Party Hereto
THE CHASE MANHATTAN BANK,
as Administrative Agent
and
NATIONAL CITY BANK,
as Documentation Agent
----------
$300,000,000
----------
CHASE SECURITIES INC.,
as Lead Arranger and Book Manager
- --------------------------------------------------------------------------------
<PAGE>
================================================================================
TABLE OF CONTENTS
Page
ARTICLE I
DEFINITIONS....................................................................1
SECTION 1.01. Defined Terms..............................................1
SECTION 1.02. Classification of Loans and Borrowings....................26
SECTION 1.03. Terms Generally...........................................26
SECTION 1.04. Accounting Terms; GAAP....................................27
ARTICLE II
THE CREDITS...................................................................27
SECTION 2.01. The Commitments...........................................27
SECTION 2.02. Loans and Borrowings......................................28
SECTION 2.03. Requests for Syndicated Borrowings........................28
SECTION 2.04. Swingline Loans; Foreign Currency Credits.................29
SECTION 2.05. Letters of Credit.........................................34
SECTION 2.06. Funding of Borrowings.....................................39
SECTION 2.07. Interest Elections........................................40
SECTION 2.08. Termination and Reduction of the Commitments..............42
SECTION 2.09. Repayment of Loans; Evidence of Debt......................43
SECTION 2.10. Prepayment of Loans.......................................46
SECTION 2.11. Fees......................................................51
SECTION 2.12. Interest..................................................52
SECTION 2.13. Alternate Rate of Interest................................53
SECTION 2.14. Increased Costs...........................................54
SECTION 2.15. Break Funding Payments....................................55
SECTION 2.16. Taxes.....................................................56
SECTION 2.17. Payments Generally; Pro Rata Treatment; Sharing of
Set-offs..................................................57
SECTION 2.18. Mitigation Obligations; Replacement of Lenders............60
ARTICLE III
GUARANTEE.....................................................................61
SECTION 3.01. The Guarantee.............................................61
SECTION 3.02. Obligations Unconditional.................................62
SECTION 3.03. Reinstatement.............................................63
SECTION 3.04. Subrogation...............................................63
SECTION 3.05. Remedies..................................................63
SECTION 3.06. Instrument for the Payment of Money.......................63
<PAGE>
SECTION 3.07. Continuing Guarantee......................................64
SECTION 3.08. Rights of Contribution....................................64
SECTION 3.09. General Limitation on Guarantee Obligations...............65
ARTICLE IV
REPRESENTATIONS AND WARRANTIES................................................65
SECTION 4.01. Organization; Powers......................................65
SECTION 4.02. Authorization; Enforceability.............................65
SECTION 4.03. Governmental Approvals; No Conflicts......................66
SECTION 4.04. Financial Condition; No Material Adverse Change; Year
2000 Issues...............................................66
SECTION 4.05. Properties................................................67
SECTION 4.06. Litigation................................................68
SECTION 4.07. Environmental Matters.....................................68
SECTION 4.08. Compliance with Laws and Agreements.......................70
SECTION 4.09. Investment and Holding Company Status.....................70
SECTION 4.10. Taxes.....................................................70
SECTION 4.11. ERISA.....................................................71
SECTION 4.12. Disclosure................................................71
SECTION 4.13. Use of Credit.............................................71
SECTION 4.14. Debt Agreements and Liens.................................72
SECTION 4.15. Capitalization............................................72
SECTION 4.16. Subsidiaries and Investments..............................72
SECTION 4.17. Real Property.............................................73
SECTION 4.18. Solvency..................................................73
SECTION 4.19. Labor Matters.............................................74
SECTION 4.20. No Burdensome Restrictions................................74
SECTION 4.21. Acquisition...............................................74
ARTICLE V
CONDITIONS....................................................................75
SECTION 5.01. Effective Date............................................75
SECTION 5.02. Each Credit Event.........................................80
SECTION 5.03. Conditions to Application of Term Loan Proceeds...........81
ARTICLE VI
AFFIRMATIVE COVENANTS.........................................................82
SECTION 6.01. Financial Statements and Other Information................82
SECTION 6.02. Notices of Material Events................................84
SECTION 6.03. Existence; Conduct of Business............................85
SECTION 6.04. Payment of Obligations....................................85
-iii-
<PAGE>
SECTION 6.05. Maintenance of Properties; Insurance......................85
SECTION 6.06. Books and Records; Inspection.............................85
SECTION 6.07. Compliance with Laws......................................86
SECTION 6.08. Use of Proceeds and Letters of Credit.....................86
SECTION 6.09. Hedging Agreements........................................86
SECTION 6.10. Certain Obligations Respecting Subsidiaries and
Collateral................................................86
SECTION 6.11. Senior Secured Notes......................................88
ARTICLE VII
NEGATIVE COVENANTS............................................................88
SECTION 7.01. Indebtedness..............................................88
SECTION 7.02. Liens.....................................................89
SECTION 7.03. Fundamental Changes.......................................90
SECTION 7.04. Investments...............................................92
SECTION 7.05. Restricted Payments.......................................93
SECTION 7.06. Transactions with Affiliates..............................94
SECTION 7.07. Restrictive Agreements....................................94
SECTION 7.08. Operating Leases..........................................95
SECTION 7.09. Certain Financial Covenants...............................95
SECTION 7.10. Modifications of Certain Documents; Payment of Senior
Secured Notes.............................................96
SECTION 7.11. Sale and Leaseback........................................97
SECTION 7.12. Fiscal Year...............................................97
ARTICLE VIII
EVENTS OF DEFAULT.............................................................97
ARTICLE IX
THE ADMINISTRATIVE AGENT.....................................................101
ARTICLE X
MISCELLANEOUS................................................................104
SECTION 10.01. Notices.................................................104
SECTION 10.02. Waivers; Amendments.....................................105
SECTION 10.03. Expenses; Indemnity; Damage Waiver......................107
SECTION 10.04. Successors and Assigns..................................109
SECTION 10.05. Survival................................................111
SECTION 10.06. Counterparts; Integration; Effectiveness................112
SECTION 10.07. Severability............................................112
SECTION 10.08. Right of Setoff.........................................112
-iv-
<PAGE>
SECTION 10.09. Governing Law; Jurisdiction; Etc........................113
SECTION 10.10. WAIVER OF JURY TRIAL....................................113
SECTION 10.11. Headings................................................114
SECTION 10.12. Treatment of Certain Information; Confidentiality.......114
SECTION 10.13. European Monetary Union.................................115
SCHEDULE I - Commitments
SCHEDULE II - Indebtedness and Liens
SCHEDULE III - Restrictive Agreements
SCHEDULE IV - Litigation
SCHEDULE V - Environmental Matters
SCHEDULE VI - Subsidiaries and Investments
SCHEDULE VII - Real Property
SCHEDULE VIII - Labor Matters
SCHEDULE IX - Existing Letters of Credit
EXHIBIT A - Form of Assignment and Acceptance
EXHIBIT B - Form of Security Agreement
EXHIBIT C - Form of Mortgage
EXHIBIT D - Form of Guarantee Assumption Agreement
-v-
<PAGE>
CREDIT AGREEMENT dated as of April 12, 1999, between CHART
INDUSTRIES, INC., the SUBSIDIARY BORROWERS party hereto, the SUBSIDIARY
GUARANTORS party hereto, the LENDERS party hereto, THE CHASE MANHATTAN BANK, as
Administrative Agent, and NATIONAL CITY BANK, as Documentation Agent.
The Borrower (as hereinafter defined) has requested that the Lenders
(as so defined) extend credit to the Borrower and/or the Subsidiary Borrowers
(as so defined), under the guarantee of the Subsidiary Guarantors (as so
defined) and/or the Borrower, in an aggregate principal or face amount not
exceeding $300,000,000, to refinance certain existing indebtedness of the
Borrower and its Subsidiaries (as so defined), to enable the Borrower to
consummate the Acquisition (as so defined) and for working capital and other
general corporate purposes of the Borrower and its Subsidiaries. The Lenders are
prepared to extend such credit upon the terms and conditions hereof, and,
accordingly, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.01. Defined Terms. As used in this Agreement, the
following terms have the meanings specified below:
"A Term Loan" means a Term Loan made pursuant to Section 2.01(b).
"ABR", when used in reference to any Loan or Borrowing, refers to
whether such Loan, or the Loans constituting such Borrowing, are bearing
interest at a rate determined by reference to the Alternate Base Rate.
"Acquisition" means the acquisition by the Borrower of MVE Holdings
and its Subsidiaries, effected through the merger of MVE Investors with and into
Chart Acquisition (with Chart Acquisition as the surviving corporation) followed
by the merger of Chart Acquisition with and into MVE Holdings (with MVE Holdings
as the surviving corporation), and the other transactions contemplated by the
Acquisition Documents that are to take place substantially simultaneously with
the Effective Date.
"Acquisition Documents" means, collectively, the Merger Agreements,
the Indemnification Agreement (as defined in the MVE Holdings Merger Agreement)
and the Escrow Agreement (as defined in the MVE Holdings Merger Agreement).
Credit Agreement
<PAGE>
-2-
"Adjusted LIBO Rate" means, for the Interest Period for any
Eurodollar Borrowing, an interest rate per annum (rounded upwards, if necessary,
to the next 1/16 of 1%) equal to (a) the LIBO Rate for such Interest Period
multiplied by (b) the Statutory Reserve Rate for such Interest Period.
"Administrative Agent" means Chase, in its capacity as
administrative agent for the Lenders hereunder.
"Administrative Questionnaire" means an Administrative Questionnaire
in a form supplied by the Administrative Agent.
"Affiliate" means, with respect to a specified Person, another
Person that directly, or indirectly through one or more intermediaries, Controls
or is Controlled by or is under common Control with the Person specified.
"Alternate Base Rate" means, for any day, a rate per annum equal to
the greater of (a) the Prime Rate in effect on such day and (b) the Federal
Funds Effective Rate for such day plus 1/2 of 1%. Any change in the Alternate
Base Rate due to a change in the Prime Rate or the Federal Funds Effective Rate
shall be effective from and including the effective date of such change in the
Prime Rate or the Federal Funds Effective Rate, as the case may be.
"Applicable Margin" means, for any day, with respect to any ABR Loan
(including any Swingline Loan) or Eurodollar Loan, as the case may be, of any
Class the applicable rate per annum set forth below under the caption "ABR
Spread" or "Eurodollar Spread" with respect to such Class, respectively, based
upon the Leverage Ratio as of the most recent determination date; provided that
until the third Business Day after delivery of the Borrower's unaudited
consolidated financial statements for the fiscal quarter ending June 30, 1999,
the "Applicable Margin" shall be the applicable rate per annum set forth below
in Category 3:
Credit Agreement
<PAGE>
-3-
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------
Eurodollar
ABR Spread for Spread for
Revolving Revolving Credit ABR Spread Eurodollar
Credit Loans Loans and Term for Term Spread for
Leverage Ratio: and Term Loan A Loan A Loan B Term Loan B
- --------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Category 1
1.0% 2.0% 1.50% 2.50%
Greater than 4.00 to 1
- --------------------------------------------------------------------------------------------
Category 2
0.75% 1.75% 1.25% 2.25%
Less than or equal to
4.00 to 1 and greater
than 3.50 to 1
- --------------------------------------------------------------------------------------------
Category 3
0.50% 1.50% 1.00% 2.00%
Less than or equal to
3.50 to 1 and greater
than 3.00 to 1
- --------------------------------------------------------------------------------------------
Category 4
0.25% 1.25% 1.00% 2.00%
Less than or equal to
3.00 to 1
- --------------------------------------------------------------------------------------------
</TABLE>
For purposes of the foregoing (but subject to the proviso above), (a) the
Leverage Ratio shall be determined as of the end of each fiscal quarter of the
Borrower's fiscal year based upon the Borrower's consolidated financial
statements delivered pursuant to Section 6.01(a) or (b) and (b) each change in
the Applicable Margin resulting from a change in the Leverage Ratio shall be
effective during the period commencing on and including the date three Business
Days after delivery to the Administrative Agent of such consolidated financial
statements indicating such change and ending on the date immediately preceding
the effective date of the next such change; provided that the Leverage Ratio
shall be deemed to be in Category 1 above (i) at any time that an Event of
Default has occurred and is continuing and (ii) if the Borrower fails to deliver
the consolidated financial statements required to be delivered by it pursuant to
Section 6.01(a) or (b) and/or the related compliance certificate, during the
period from the expiration of the time for delivery thereof until such
consolidated financial statements and compliance certificate are so delivered.
Credit Agreement
<PAGE>
-4-
"Applicable Percentage" means (a) with respect to any Revolving
Credit Lender for purposes of Section 2.04 or 2.05 or in respect of any
indemnity claim under Section 10.03(c) arising out of an action or omission of
the Swingline Lender, the Foreign Currency Lender or the Issuing Lenders under
this Agreement, the percentage of the total Revolving Credit Commitments
represented by such Revolving Credit Lender's Revolving Credit Commitment, and
(b) with respect to any Lender in respect of any indemnity claim under Section
10.03(c) arising out of an action or omission of the Administrative Agent under
this Agreement, the percentage of the total Commitments or Loans of all Classes
hereunder represented by the aggregate amount of such Lender's Commitments or
Loans of all Classes hereunder. If the Revolving Credit Commitments have
terminated or expired, the Applicable Percentages shall be determined based upon
the Revolving Credit Commitments most recently in effect, giving effect to any
assignments.
"Approved Fund" means, with respect to any Lender that is a fund
that invests in commercial loans, any other fund that invests in commercial
loans and is managed or advised by the same investment advisor as such Lender or
by an Affiliate of such investment advisor.
"Assignment and Acceptance" means an Assignment and Acceptance
entered into by a Lender and an assignee (with the consent of any Person whose
consent is required by Section 10.04(b)), and accepted by the Administrative
Agent, in the form of Exhibit A or any other form approved by the Administrative
Agent.
"B Term Loan" means a Term Loan made pursuant to Section 2.01(c).
"Basic Documents" means, collectively, the Credit Documents and the
Acquisition Documents.
"Board" means the Board of Governors of the Federal Reserve System
of the United States of America.
"Bond Tender Offer" means the offer by Chart Acquisition to purchase
for cash any and all of the Senior Secured Notes pursuant to the Offer to
Purchase, which was commenced on February 17, 1999.
"Bond Tender Offer Closing Date" means the date on which the Bond
Tender Offer is consummated and the conditions specified in Section 5.03 are
satisfied (or waived in accordance with Section 10.02).
"Bond Tender Offer Collateral Account" has the meaning assigned to
such term in Section 2.06(c).
Credit Agreement
<PAGE>
-5-
"Borrower" means Chart Industries, Inc., a Delaware corporation.
"Borrowing" means (a) all Syndicated ABR Loans of the same Class
made, converted or continued on the same date, (b) all Eurodollar Loans of the
same Class that have the same Interest Period, (c) a Swingline Loan or (d) a
Foreign Currency Credit. For purposes hereof, the date of a Syndicated Borrowing
comprising one or more Loans that have been converted or continued shall be the
effective date of the most recent conversion or continuation of such Loan or
Loans.
"Borrowing Request" means a request by the Borrower for a Syndicated
Borrowing in accordance with Section 2.03.
"Business Day" means (i) any day that is not a Saturday, Sunday or
other day on which commercial banks in New York City are authorized or required
by law to remain closed; provided that, when used in connection with a
Eurodollar Loan, the term "Business Day" shall also exclude any day on which
banks are not open for dealings in Dollar deposits in the London interbank
market and (ii) when used in connection with a Foreign Currency Credit, the term
"Business Day" shall exclude any day on which commercial banks and foreign
exchange markets do not settle payments in the principal financial center (as
determined by the Administrative Agent) of the country that issues the Foreign
Currency in which such Foreign Currency Credit is denominated and shall be
subject to Section 10.13.
"Capital Expenditures" means, for any period, expenditures made by
the Borrower or any of its Subsidiaries to acquire or construct fixed assets,
plant and equipment (including renewals, improvements and replacements, but
excluding repairs) during such period computed in accordance with GAAP.
"Capital Lease Obligations" of any Person means the obligations of
such Person to pay rent or other amounts under any lease of (or other
arrangement conveying the right to use) real or personal property, or a
combination thereof, which obligations are required to be classified and
accounted for as capital leases on a balance sheet of such Person under GAAP,
and the amount of such obligations shall be the capitalized amount thereof
determined in accordance with GAAP.
"Casualty Event" means, with respect to any property of any Person,
any loss of or damage to, or any condemnation or other taking of, such property
for which such Person or any of its Subsidiaries receives insurance proceeds, or
proceeds of a condemnation award or other compensation.
Credit Agreement
<PAGE>
-6-
"Change in Control" means any of the following: (a) the acquisition
of ownership, directly or indirectly, beneficially or of record, by any Person
or group (within the meaning of the Securities Exchange Act of 1934 and the
rules of the Securities and Exchange Commission thereunder as in effect on the
date hereof) (other than by Arthur Holmes and/or any related trust of which he
or any immediate member of his family is the beneficiary), of shares
representing more than 35% of the aggregate ordinary voting power represented by
the issued and outstanding capital stock of the Borrower ("Voting Stock"); (b)
occupation of a majority of the seats (other than vacant seats) on the board of
directors of the Borrower by Persons who were neither (i) nominated by the board
of directors of the Borrower nor (ii) appointed by directors so nominated; or
(c) failure of Arthur Holmes and/or any related trust of which he or any
immediate member of his family is the beneficiary to own at least 3,000,000
shares of the Voting Stock (as such number of shares shall be adjusted for stock
splits and combinations, stock dividends, recapitalizations or other similar
transactions after the date hereof).
"Change in Law" means (a) the adoption of any law, rule or
regulation after the date of this Agreement, (b) any change in any law, rule or
regulation or in the interpretation or application thereof by any Governmental
Authority after the date of this Agreement or (c) compliance by any Lender or
any Issuing Lender (or, for purposes of Section 2.14(b), by any lending office
of such Lender or by such Lender's or such Issuing Lender's holding company, if
any) with any request, guideline or directive (whether or not having the force
of law) of any Governmental Authority made or issued after the date of this
Agreement.
"Chart Acquisition" means Chart Acquisition Company, a Delaware
corporation and, as of the date hereof, a direct Wholly Owned Subsidiary of the
Borrower.
"Chase" means The Chase Manhattan Bank.
"CHD" means CHD, Inc., a Delaware corporation.
"Class", when used in reference to any Loan or Borrowing, refers to
whether such Loan, or the Loans constituting such Borrowing, are Revolving
Credit Loans, A Term Loans, B Term Loans, Swingline Loans or Foreign Currency
Credits and, when used in reference to any Commitment, refers to whether such
Commitment is a Revolving Credit Commitment, Term Loan A Commitment or Term Loan
B Commitment.
"Code" means the Internal Revenue Code of 1986, as amended from time
to time.
"Collateral Account" has the meaning assigned to such term in the
Security Agreement.
Credit Agreement
<PAGE>
-7-
"Commitment" means a Revolving Credit Commitment, Term Loan A
Commitment or Term Loan B Commitment, or any combination thereof (as the context
requires).
"Control" means the possession, directly or indirectly, of the power
to direct or cause the direction of the management or policies of a Person,
whether through the ability to exercise voting power, by contract or otherwise.
"Controlling" and "Controlled" have meanings correlative thereto.
"Credit Documents" means, collectively, this Agreement, the Letter
of Credit Documents and the Security Documents.
"Current Assets" means, as at any date, the total assets that would
properly be classified as consolidated current assets (excluding cash and
Permitted Investments) of the Borrower and its Subsidiaries as of such date in
accordance with GAAP.
"Current Liabilities" means, as at any date, the total liabilities
that would properly be classified as consolidated current liabilities (excluding
the current portion of long-term Indebtedness) of the Borrower and its
Subsidiaries as of such date in accordance with GAAP.
"Debt Incurrence" means the incurrence of any Indebtedness by the
Borrower or any Subsidiary Guarantor after the Effective Date, provided that
Debt Incurrence shall not include Indebtedness permitted under Section 7.01.
"Debt Service" means, for any period, the sum, for the Borrower and
its Subsidiaries (determined on a consolidated basis without duplication in
accordance with GAAP), of the following: (a) all regularly scheduled payments or
prepayments of principal of Indebtedness (including the principal component of
any payments in respect of Capital Lease Obligations) made during such period
plus (b) all Interest Expense for such period.
"Default" means any event or condition which constitutes an Event of
Default or which upon notice, lapse of time or both would, unless cured or
waived, become an Event of Default.
"Disposition" means any sale, assignment, transfer or other
disposition of any property (whether now owned or hereafter acquired) by the
Borrower or any of its Subsidiaries to any other Person excluding any sale,
assignment, transfer or other disposition of any property sold or disposed of in
the ordinary course of business and on ordinary business terms.
Credit Agreement
<PAGE>
-8-
"Documentation Agent" means National City Bank, in its capacity as
documentation agent hereunder.
"Dollars" or "$" refers to lawful money of the United States of
America.
"Dollar Equivalent" means, with respect to any Foreign Currency
Credit, the equivalent amount in Dollars determined on the basis of the
applicable spot selling rate in the relevant foreign exchange market, as
determined by the Foreign Currency Lender (which determination shall be
conclusive absent manifest error).
"EBIT" means, for any period, the sum, for the Borrower and its
Subsidiaries (determined on a consolidated basis without duplication in
accordance with GAAP), of the following for such period: (a) net income for such
period plus (b) to the extent deducted in computing such net income, the sum of
(i) income tax expense, plus (ii) Interest Expense for such period.
"EBITDA" means, for any period, the sum, for the Borrower and its
Subsidiaries (determined on a consolidated basis without duplication in
accordance with GAAP), of the following for such period: (a) net income for such
period plus (b) to the extent deducted in computing such net income, the sum of
(i) income tax expense, plus (ii) depreciation, amortization for such period
(including amortization of any goodwill or other intangibles), plus (iii)
Interest Expense for such period plus (iv) all other non-cash, extraordinary
charges plus (v) for any period ending on or prior to December 31, 1999,
non-recurring, cash charges of $5,000,000 in the aggregate minus (c) to the
extent added in computing such net income, the sum of (i) any gains and losses
attributable to any fixed asset sales and (ii) any non-cash, extraordinary
gains; provided that in calculating EBITDA for the purpose of the Leverage Ratio
only, for any period prior to four full fiscal quarters after the Effective
Date, EBITDA of the Borrower and its Subsidiaries shall include on a pro forma
basis EBITDA of MVE Holdings and its Subsidiaries as if the Acquisition had
occurred on the first day of the relevant calculation period.
"Effective Date" means the date on which the conditions specified in
Section 5.01 are satisfied (or waived in accordance with Section 10.02).
"Environmental Laws" means all laws, rules, regulations, codes,
ordinances, orders, decrees, judgments, injunctions, notices or binding
agreements issued, promulgated or entered into by any Governmental Authority,
relating in any way to the environment, preservation or reclamation of natural
resources, the management or Release of any Hazardous Material or to health or
safety matters.
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"Environmental Liability" means any liability, contingent or
otherwise (including any liability for damages, costs of environmental
remediation, fines, penalties or indemnities, and including any Lien filed
against all or any part of any property covered by the Security Documents in
favor of any governmental entity), of the Borrower or any Subsidiary directly or
indirectly resulting from or based upon (a) violation of any Environmental Law,
(b) the generation, use, handling, transportation, storage, treatment or
disposal of any Hazardous Materials, (c) exposure to any Hazardous Materials,
(d) the release or threatened release of any Hazardous Materials into the
environment or (e) any contract, agreement or other consensual arrangement
pursuant to which liability is assumed or imposed with respect to any of the
foregoing.
"Equity Issuance" means (a) any issuance or sale by the Borrower or
any of its Subsidiaries after the Effective Date of (i) any of its capital
stock, (ii) any warrants or options exercisable in respect of its capital stock
(other than (A) any warrants or options issued in connection with the
consummation of the Acquisition, (B) any warrants or options issued to
directors, officers or employees of the Borrower or any of its Subsidiaries
pursuant to employee benefit plans established in the ordinary course of
business and (C) any capital stock of the Borrower issued upon the exercise of
any such warrants or options) or (iii) any other security or instrument
representing an equity interest (or the right to obtain any equity interest) in
the Borrower or any of its Subsidiaries or (b) the receipt by the Borrower or
any of its Subsidiaries after the Effective Date of any capital contribution
(whether or not evidenced by any equity security issued by the recipient of such
contribution); provided that Equity Issuance shall not include (x) any such
issuance or sale by any Subsidiary of the Borrower to the Borrower or any Wholly
Owned Subsidiary of the Borrower or (y) any capital contribution by the Borrower
or any Wholly Owned Subsidiary of the Borrower to any Subsidiary of the
Borrower.
"Equity Rights" means, with respect to any Person, any
subscriptions, options, warrants, commitments, preemptive rights or agreements
of any kind (including any shareholders' or voting trust agreements) for the
issuance, sale, registration or voting of, or securities convertible into, any
additional shares of capital stock of any class, or partnership or other
ownership interests of any type in, such Person.
"ERISA" means the Employee Retirement Income Security Act of 1974,
as amended from time to time.
"ERISA Affiliate" means any trade or business (whether or not
incorporated) that, together with the Borrower, is treated as a single employer
under Section 414(b) or (c) of the Code, or, solely for purposes of Section 302
of ERISA and Section 412 of the Code, is treated as a single employer under
Section 414 of the Code.
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"ERISA Event" means (a) any "reportable event", as defined in
Section 4043 of ERISA or the regulations issued thereunder with respect to a
Plan (other than an event for which the 30-day notice period is waived); (b) the
existence with respect to any Plan of an "accumulated funding deficiency" (as
defined in Section 412 of the Code or Section 302 of ERISA), whether or not
waived; (c) the filing pursuant to Section 412(d) of the Code or Section 303(d)
of ERISA of an application for a waiver of the minimum funding standard with
respect to any Plan; (d) the incurrence by the Borrower or any of its ERISA
Affiliates of any liability under Title IV of ERISA with respect to the
termination of any Plan; (e) the receipt by the Borrower or any ERISA Affiliate
from the PBGC or a plan administrator of any notice relating to an intention to
terminate any Plan or Plans or to appoint a trustee to administer any Plan; (f)
the incurrence by the Borrower or any of its ERISA Affiliates of any liability
with respect to the withdrawal or partial withdrawal from any Plan or
Multiemployer Plan; or (g) the receipt by the Borrower or any ERISA Affiliate of
any notice, or the receipt by any Multiemployer Plan from the Borrower or any
ERISA Affiliate of any notice, concerning the imposition of Withdrawal Liability
or a determination that a Multiemployer Plan is, or is expected to be, insolvent
or in reorganization, within the meaning of Title IV of ERISA.
"Eurodollar", when used in reference to any Loan or Borrowing,
refers to whether such Loan, or the Loans constituting such Borrowing, are
bearing interest at a rate determined by reference to the Adjusted LIBO Rate.
"Event of Default" has the meaning assigned to such term in Article
VIII.
"Excess Cash Flow" means, for any period, (a) EBITDA for such period
minus (b) the sum of (i) Capital Expenditures made during such period (except
for any such Capital Expenditures to the extent financed with the proceeds of
purchase money Indebtedness or Capital Lease Obligations incurred during such
period) plus (ii) the aggregate amount of Debt Service for such period
(excluding any prepayment made during such period pursuant to Section
2.10(b)(iv)) plus (iii) the aggregate amount of income taxes paid in cash by the
Borrower and its Subsidiaries during such fiscal year plus (iv) the aggregate
amount of cash dividends paid by the Borrower on its common stock during such
period under Section 7.05(d) plus (v) the aggregate amount paid by the Borrower
during such period in respect of the repurchase of its common stock under
Section 7.05(c) plus (or minus) (c) an amount equal to the decrease (or
increase, as the case may be) in Net Working Capital during such period (to the
extent not taken into account in any of the foregoing clauses).
"Excluded Taxes" means, with respect to the Administrative Agent,
any Lender, any Issuing Lender or any other recipient of any payment to be made
by or on account of any obligation of the Borrower hereunder, (a) income or
franchise taxes imposed on (or measured by) its net income by the United States
of America, or by the jurisdiction under the laws of
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which such recipient is organized or in which its principal office is located
or, in the case of any Lender, in which its applicable lending office is
located, (b) any branch profits taxes imposed by the United States of America or
any similar tax imposed by any other jurisdiction in which the Borrower is
located and (c) in the case of a Foreign Lender (other than an assignee pursuant
to a request by the Borrower under Section 2.18(b)), any withholding tax that is
imposed on amounts payable to such Foreign Lender at the time such Foreign
Lender becomes a party to this Agreement or is attributable to such Foreign
Lender's failure or inability to comply with Section 2.16(e), except to the
extent that such Foreign Lender's assignor (if any) was entitled, at the time of
assignment, to receive additional amounts from the Borrower with respect to such
withholding tax pursuant to Section 2.16(a).
"Existing Chart Credit Agreement" means the Credit Agreement dated
as of July 29, 1997 by and between the Borrower and certain of its Subsidiaries,
the lenders party thereto and National City Bank, as agent for such banks, as
amended and in effect immediately prior to the Effective Date.
"Existing Letters of Credit" has the meaning assigned to such term
in Section 2.05(l).
"Existing MVE Credit Agreement" means the Credit Agreement dated as
of October 31, 1997 by and among MVE and certain of its Subsidiaries, the
lenders party thereto and BankBoston, N.A. as agent for such lenders, as amended
and in effect immediately prior to the Effective Date.
"Federal Funds Effective Rate" means, for any day, the weighted
average (rounded upwards, if necessary, to the next 1/100 of 1%) of the rates on
overnight Federal funds transactions with members of the Federal Reserve System
arranged by Federal funds brokers, as published on the next succeeding Business
Day by the Federal Reserve Bank of New York, or, if such rate is not so
published for any day that is a Business Day, the average (rounded upwards, if
necessary, to the next 1/100 of 1%) of the quotations for such day for such
transactions received by the Administrative Agent from three Federal funds
brokers of recognized standing selected by it.
"Financial Officer" means the chief financial officer, principal
accounting officer, treasurer or controller of the Borrower.
"Fixed Charge Coverage Ratio" means, as at any date, the ratio of
(a) (i) EBITDA for the period of four consecutive fiscal quarters ending on or
most recently ended prior to such date minus (ii) Capital Expenditures for such
period to (b) Fixed Charges for such period; provided that in calculating the
Fixed Charge Coverage Ratio at any date prior to March 31,
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2000, each component of the Fixed Charge Coverage Ratio shall be determined only
for the period commencing on April 1, 1999 and ending on June 30, 1999,
September 30, 1999 and December 31, 1999, as applicable.
"Fixed Charges" means, for any period, the sum, for the Borrower and
its Subsidiaries (determined on a consolidated basis without duplication in
accordance with GAAP), of the following: (a) all Debt Service for such period
plus (b) the aggregate amount of income taxes paid during such period plus (c)
the aggregate amount of cash dividends paid by the Borrower on its common stock
during such period under Section 7.05(d) plus (d) the aggregate amount paid by
the Borrower during such period in respect of the repurchase of its common stock
under Section 7.05(c).
"Foreign Currencies" means Pounds Sterling, Deutschmarks and any
other lawful currency other than Dollars which is freely convertible into
Dollars and which, from time to time, is acceptable to the Foreign Currency
Lender and the Administrative Agent.
"Foreign Currency Credit" means an extension of credit made pursuant
to Section 2.04(b).
"Foreign Currency Credit Exposure" means, at any time, the aggregate
principal amount of all Foreign Currency Credits outstanding at such time. The
Foreign Currency Exposure of any Lender at any time shall be its Applicable
Percentage of Dollar Equivalent of the total Foreign Currency Exposure at such
time.
"Foreign Currency Lender" means NBD Bank or one of its affiliates
acting for NBD Bank or such Lender or an affiliate of such Lender designated by
the Borrower (with the approval of the Administrative Agent) to be the successor
to the Foreign Currency Lender.
"Foreign Lender" means any Lender that is organized under the laws
of a jurisdiction other than that in which the Borrower is located. For purposes
of this definition, the United States of America, each State thereof and the
District of Columbia shall be deemed to constitute a single jurisdiction.
"Foreign Subsidiary" means any Subsidiary of the Borrower that is
organized under the laws of a jurisdiction other than a State of the United
States or the District of Columbia.
"Foreign Subsidiary Pledge Agreement" means a pledge or similar
agreement between an Obligor and the Administrative Agent (or a sub-agent of the
Administrative Agent),
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providing for the pledge of certain equity interests of a Foreign Subsidiary,
executed and delivered pursuant to this Agreement.
"Funded Indebtedness" means all Indebtedness of the Borrower and its
Subsidiaries (determined on a consolidated basis without duplication in
accordance with GAAP) of a type described in clauses (a), (b), (c), (d), (e),
(f) or (g) (or any Guarantee of any such Indebtedness) of the definition of
"Indebtedness" in this Section.
"GAAP" means generally accepted accounting principles in the United
States of America.
"Governmental Authority" means the government of the United States
of America, any other nation or any political subdivision thereof, whether state
or local, and any agency, authority, instrumentality, regulatory body, court,
central bank or other entity exercising executive, legislative, judicial,
taxing, regulatory or administrative powers or functions of or pertaining to
government.
"Guarantee" of or by any Person (the "guarantor") means any
obligation, contingent or otherwise, of the guarantor guaranteeing or having the
economic effect of guaranteeing any Indebtedness or other obligation of any
other Person (the "primary obligor") in any manner, whether directly or
indirectly, and including any obligation of the guarantor, direct or indirect,
(a) to purchase or pay (or advance or supply funds for the purchase or payment
of) such Indebtedness or other obligation or to purchase (or to advance or
supply funds for the purchase of) any security for the payment thereof, (b) to
purchase or lease property, securities or services for the purpose of assuring
the owner of such Indebtedness or other obligation of the payment thereof, (c)
to maintain working capital, equity capital or any other financial statement
condition or liquidity of the primary obligor so as to enable the primary
obligor to pay such Indebtedness or other obligation or (d) as an account party
in respect of any letter of credit or letter of guaranty issued to support such
Indebtedness or obligation; provided that the term Guarantee shall not include
endorsements for collection or deposit in the ordinary course of business.
"Guarantee Assumption Agreement" means a Guarantee Assumption
Agreement substantially in the form of Exhibit D by an entity that, pursuant to
Section 6.10(a) is required to become a "Subsidiary Guarantor" hereunder in
favor of the Administrative Agent.
"Guarantors" means the Borrower (to the extent provided in Section
3.01(a)) and the Subsidiary Guarantors.
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"Hazardous Materials" means all explosive or radioactive substances
or wastes and all hazardous or toxic substances, wastes or other pollutants,
including petroleum or petroleum distillates, asbestos or asbestos-containing
materials, polychlorinated biphenyls, radon gas, infectious or medical wastes
and all other substances or wastes of any nature regulated pursuant to any
Environmental Law.
"Hedging Agreement" means any interest rate protection agreement,
foreign currency exchange agreement, commodity price protection agreement or
other interest or currency exchange rate or commodity price hedging arrangement.
"Indebtedness" of any Person means, without duplication, (a) all
obligations of such Person for borrowed money or with respect to deposits or
advances of any kind (other than deposits or advances made or received in the
ordinary course of business), (b) all obligations of such Person evidenced by
bonds, debentures, notes or similar instruments, (c) all obligations of such
Person under conditional sale or other title retention agreements relating to
property acquired by such Person, (d) all obligations of such Person in respect
of the deferred purchase price of property or services (excluding current
accounts payable incurred in the ordinary course of business), (e) all
Indebtedness of others secured by (or for which the holder of such Indebtedness
has an existing right, contingent or otherwise, to be secured by) any Lien on
property owned or acquired by such Person, whether or not the Indebtedness
secured thereby has been assumed, (f) all Guarantees by such Person of
Indebtedness of others, (g) all Capital Lease Obligations of such Person, (h)
all obligations, contingent or otherwise, of such Person as an account party in
respect of letters of credit and letters of guaranty and (i) all obligations,
contingent or otherwise, of such Person in respect of bankers' acceptances. The
Indebtedness of any Person shall include the Indebtedness of any other entity
(including any partnership in which such Person is a general partner) to the
extent such Person is liable therefor as a result of such Person's ownership
interest in or other relationship with such entity, except to the extent the
terms of such Indebtedness provide that such Person is not liable therefor.
"Indemnified Taxes" means Taxes other than Excluded Taxes.
"Information Memorandum" means the Confidential Information
Memorandum dated February 1999 with respect to the credit facilities
contemplated hereby heretofore furnished to each of the Lenders.
"Interest Coverage Ratio" means, as at any date of determination
thereof, the ratio of (a) EBIT for the period of four fiscal quarters ending on
or most recently ended prior to such date to (b) Interest Expense for such
period; provided that in calculating the Interest Coverage Ratio at any date
prior to March 31, 2000, each component of the Interest Coverage Ratio shall
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be determined only for the period commencing on April 1, 1999 and ending on June
30, 1999, September 30, 1999 and December 31, 1999, as applicable.
"Interest Election Request" means a request by the Borrower to
convert or continue a Syndicated Borrowing in accordance with Section 2.07.
"Interest Expense" means, for any period, the sum, for the Borrower
and its Subsidiaries (determined on a consolidated basis without duplication in
accordance with GAAP), of the following: (a) all interest in respect of
Indebtedness (including the interest component of any payments in respect of
Capital Lease Obligations) accrued or capitalized during such period (whether or
not actually paid during such period) plus (b) the net amount payable (or minus
the net amount receivable) under Hedging Agreements relating to interest during
such period (whether or not actually paid or received during such period).
"Interest Payment Date" means (a) with respect to any Syndicated ABR
Loan, each Quarterly Date, (b) with respect to any Eurodollar Loan, the last day
of each Interest Period therefor and, in the case of any Interest Period that is
more than three months long, each day prior to the last day of such Interest
Period that occurs at intervals of three months after the first day of such
Interest Period and (c) with respect to any Swingline Loan, the day that such
Loan is required to be repaid.
"Interest Period" means (a) for any Borrowing (other than an ABR
Borrowing), the Interest Period of the Loan or Loans constituting such
Borrowing; and (b) for any Eurodollar Loan, the period commencing on the date of
such Loan and ending on the numerically corresponding day in the calendar month
that is one, two, three or six months thereafter, as specified in the applicable
Borrowing Request or Interest Election Request; provided that (i) if any
Interest Period would end on a day other than a Business Day, such Interest
Period shall be extended to the next succeeding Business Day unless such next
succeeding Business Day would fall in the next calendar month, in which case
such Interest Period shall end on the next preceding Business Day and (ii) any
Interest Period that commences on the last Business Day of a calendar month (or
on a day for which there is no numerically corresponding day in the last
calendar month of such Interest Period) shall end on the last Business Day of
the last calendar month of such Interest Period. For purposes hereof, the date
of a Loan initially shall be the date on which such Loan is made and thereafter
shall be the effective date of the most recent conversion or continuation of
such Loan.
"Investment" means, for any Person: (a) the acquisition (whether for
cash, property, services or securities or otherwise) of capital stock, bonds,
notes, debentures, partnership or other ownership interests or other securities
of any other Person or any agreement to make any such acquisition (including any
"short sale" or any sale of any securities at a time
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when such securities are not owned by the Person entering into such sale); (b)
the making of any deposit with, or advance, loan or other extension of credit
to, any other Person (including the purchase of property from another Person
subject to an understanding or agreement, contingent or otherwise, to resell
such property to such Person), but excluding any such advance, loan or extension
of credit having a term not exceeding 90 days arising in connection with the
sale of inventory or supplies by such Person in the ordinary course of business;
(c) the entering into of any Guarantee of, or other contingent obligation with
respect to, Indebtedness or other liability of any other Person and (without
duplication) any amount committed to be advanced, lent or extended to such
Person; or (d) the entering into of any Hedging Agreement.
"Issuing Lender" means Chase, National City Bank (solely with
respect to the Existing Letters of Credit identified on Schedule IX) or any
other Lender designated by the Administrative Agent as an Issuing Lender
hereunder, each in its capacity as an issuer of one or more Letters of Credit
hereunder, and their respective successors in such capacity as provided in
Section 2.05(j).
"LC Disbursement" means a payment made by an Issuing Lender pursuant
to a Letter of Credit.
"LC Exposure" means, at any time, the sum of (a) the aggregate
undrawn amount of all outstanding Letters of Credit at such time plus (b) the
aggregate amount of all LC Disbursements that have not yet been reimbursed by or
on behalf of the Borrower at such time. The LC Exposure of any Lender at any
time shall be its Applicable Percentage of the total LC Exposure at such time.
"Lenders" means the Persons listed on Schedule I and any other
Person that shall have become a party hereto pursuant to an Assignment and
Acceptance, other than any such Person that ceases to be a party hereto pursuant
to an Assignment and Acceptance. Unless the context otherwise requires, the term
"Lenders" includes the Swingline Lender and the Foreign Currency Lender.
"Letter of Credit" means any letter of credit issued pursuant to
this Agreement (including any Existing Letter of Credit continued hereunder
pursuant to Section 2.05(l)).
"Letter of Credit Documents" means, with respect to any Letter of
Credit, collectively, any application therefor and any other agreements,
instruments, guarantees or other documents (whether general in application or
applicable only to such Letter of Credit) governing or providing for (a) the
rights and obligations of the parties concerned or at risk with respect to such
Letter of Credit or (b) any collateral security for any of such obligations,
each as the same may be modified and supplemented and in effect from time to
time.
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"Leverage Ratio" means, as at any date of determination thereof, the
ratio of (a) all Funded Indebtedness of the Borrower and its Subsidiaries
(determined on a consolidated basis, without duplication, in accordance with
GAAP) as at such date to (b) EBITDA for the period of four fiscal quarters
ending on or most recently ended prior to such date.
"LIBO Rate" means, for the Interest Period for any Eurodollar
Borrowing, the rate appearing on Page 3750 of the Telerate Service (or on any
successor or substitute page of such Service, or any successor to or substitute
for such Service, providing rate quotations comparable to those currently
provided on such page of such Service, as determined by the Administrative Agent
from time to time for purposes of providing quotations of interest rates
applicable to Dollar deposits in the London interbank market) at approximately
11:00 a.m., London time, two Business Days prior to the commencement of such
Interest Period, as the rate for the offering of Dollar deposits with a maturity
comparable to such Interest Period. In the event that such rate is not available
at such time for any reason, then the LIBO Rate for such Interest Period shall
be the rate at which Dollar deposits of $5,000,000 and for a maturity comparable
to such Interest Period are offered by the principal London office of the
Administrative Agent in immediately available funds in the London interbank
market at approximately 11:00 a.m., London time, two Business Days prior to the
commencement of such Interest Period.
"Lien" means, with respect to any asset, (a) any mortgage, deed of
trust, lien, pledge, hypothecation, encumbrance, charge or security interest in,
on or of such asset, (b) the interest of a vendor or a lessor under any
conditional sale agreement, capital lease or title retention agreement (or any
financing lease having substantially the same economic effect as any of the
foregoing) relating to such asset and (c) in the case of securities, any
purchase option, call or similar right of a third party with respect to such
securities.
"Loans" means the loans made by the Lenders to the Borrower pursuant
to this Agreement.
"Margin Stock" means "margin stock" within the meaning of
Regulations T, U and X of the Board.
"Material Adverse Effect" means a material adverse effect on (a) the
business, assets, liabilities, operations, material contracts, prospects or
condition, financial or otherwise, of the Borrower and its Subsidiaries taken as
a whole, (b) the ability of any Obligor to perform any of its obligations under
this Agreement or any of the other Credit Documents to which it is a party or
(c) the rights of or benefits available to the Lenders under this Agreement or
any of the other Credit Documents.
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"Maturity Date" means, with respect to each Class of Loans, the Term
Loan A Maturity Date, the Term Loan B Maturity Date or the Revolving Credit
Commitment Termination Date, as applicable.
"Merger Agreements" mean (i) the MVE Holdings Merger Agreement and
(ii) the Agreement and Plan of Merger dated as of February 16, 1999 among the
Borrower, Chart Acquisition and MVE Investors.
"Mortgages" means, collectively, the instruments of Mortgage, Deed
of Trust, Assignment of Rents, Security Agreement and Fixture Filing (or other
similar instruments) executed by the Borrower and/or one or more of its
Subsidiaries in favor of the Administrative Agent (or a trustee, for the benefit
of the Administrative Agent and the Lenders), in each case substantially in the
form of Exhibit C (or such other form approved by the Administrative Agent) and
covering the respective properties and leasehold interest identified therein
(and including such additional provisions and deviations from such exhibit as
shall be so necessary in the judgment of the Administrative Agent to conform
such instrument to applicable or local law or as shall be customary under local
law).
"Multiemployer Plan" means a multiemployer plan as defined in
Section 4001(a)(3) of ERISA.
"MVE" means MVE, Inc., a Delaware corporation.
"MVE Guarantee Agreement" means the Guarantee Agreement between MVE
and the Administrative Agent executed and delivered pursuant to Section
5.03(b)(iv).
"MVE Holdings" means MVE Holdings, Inc., a Delaware corporation.
"MVE Holdings Merger Agreement" mean the Agreement and Plan of
Merger dated as of February 16, 1999 by and among the Borrower, Chart
Acquisition and MVE Holdings.
"MVE Investors" mean MVE Investors LLC, a Delaware limited liability
company.
"Net Available Proceeds" means (a) in the case of any Disposition,
the amount of Net Cash Payments received in connection with such Disposition;
(b) in the case of any Casualty Event, the aggregate amount of proceeds of
insurance, condemnation awards and other compensation received by the Borrower
and its Subsidiaries in respect of such Casualty Event net of (i) reasonable
expenses incurred by the Borrower and its Subsidiaries in connection
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therewith and (ii) contractually required repayments of Indebtedness to the
extent secured by a Lien on such property and any income and transfer taxes
payable by the Borrower or any of its Subsidiaries in respect of such Casualty
Event; and (c) in the case of any Equity Issuance or Debt Incurrence, the
aggregate amount of all cash received by the Borrower and its Subsidiaries in
respect of such Equity Issuance or Debt Incurrence, as the case may be, net of
reasonable expenses incurred by the Borrower and its Subsidiaries in connection
therewith.
"Net Cash Payments" means, with respect to any Disposition, the
aggregate amount of all cash payments, and the fair market value of any non-cash
consideration, received by the Borrower and its Subsidiaries directly or
indirectly in connection with such Disposition; provided that Net Cash Payments
shall be net of (a) the amount of any legal, title and recording tax expenses,
commissions and other fees and expenses paid by the Borrower and its
Subsidiaries in connection with such Disposition, (b) any Federal, state and
local income or other taxes estimated to be payable by the Borrower and its
Subsidiaries as a result of such Disposition (but only to the extent that such
estimated taxes are in fact paid to the relevant Federal, state or local
governmental authority within six months of the date of such Disposition) and
(c) any repayments by the Borrower or any of its Subsidiaries of Indebtedness to
the extent that (i) such Indebtedness is secured by a Lien on the property that
is the subject of such Disposition and (ii) the transferee of (or holder of a
Lien on) such property requires that such Indebtedness be repaid as a condition
to the purchase of such property.
"Net Working Capital" means, as at any date, the excess of (a)
Current Assets over (b) Current Liabilities, in each as of such date.
"Net Worth" means, as at any date, the sum, for the Borrower and its
Subsidiaries (determined on a consolidated basis without duplication in
accordance with GAAP), of the following: (a) the sum of capital stock taken at
par, capital surplus and retained earnings as of such date minus (b) treasury
stock and any minority interests in Subsidiaries.
"Obligor" means the Borrower, each Subsidiary Borrower and each
Subsidiary Guarantor.
"Offer to Purchase" means the Offer to Purchase for Cash Any and All
Outstanding 12 1/2% Senior Secured Notes due February 15, 2002 issued by MVE,
Inc. and Solicitation of Consents to Amendments of the Indenture and Collateral
Documents, each dated February 17, 1999, pursuant to which Chart Acquisition has
offered to purchase for cash any and all of the outstanding Senior Secured
Notes.
"Other Taxes" means any and all present or future stamp or
documentary taxes or any other excise or property taxes, charges or similar
levies arising from any payment made
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under any Credit Document or from the execution, delivery or enforcement of, or
otherwise with respect to, any Credit Document.
"PBGC" means the Pension Benefit Guaranty Corporation referred to
and defined in ERISA and any successor entity performing similar functions.
"Permitted Encumbrances" means (a) Liens imposed by law for taxes
that are not yet due or are being contested in compliance with Section 6.04; (b)
carriers', warehousemen's, mechanics', materialmen's, repairmen's and other like
Liens imposed by law, arising in the ordinary course of business and securing
obligations that are not overdue by more than 30 days or are being contested in
compliance with Section 6.04; (c) pledges and deposits made in the ordinary
course of business in compliance with workers' compensation, unemployment
insurance and other social security laws or regulations; (d) cash deposits to
secure the performance of bids, trade contracts, leases, statutory obligations,
surety and appeal bonds, performance bonds and other obligations of a like
nature, in each case in the ordinary course of business; (e) judgment liens in
respect of judgments that do not constitute an Event of Default under clause (k)
of Article VIII; (f) easements, zoning restrictions, rights-of-way and similar
encumbrances on real property imposed by law or arising in the ordinary course
of business that do not secure any monetary obligations and do not materially
detract from the value of the affected property or interfere with the ordinary
conduct of business of the Borrower or any Subsidiary; (g) bankers liens arising
by operation of law; and (h) Liens permitted under any of the Mortgages;
provided that the term "Permitted Encumbrances" shall not include any Lien
securing Indebtedness.
"Permitted Investments" means (a) direct obligations of, or
obligations the principal of and interest on which are unconditionally
guaranteed by, the United States of America (or by any agency thereof to the
extent such obligations are backed by the full faith and credit of the United
States of America), in each case maturing within one year from the date of
acquisition thereof; (b) investments in commercial paper maturing within 270
days from the date of acquisition thereof and having, at such date of
acquisition, the highest credit rating obtainable from Standard & Poor's Ratings
Services, a Division of The McGraw-Hill Companies, Inc., or from Moody's
Investors Services, Inc; (c) investments in certificates of deposit, banker's
acceptances and time deposits maturing within 180 days from the date of
acquisition thereof issued or guaranteed by or placed with, and money market
deposit accounts issued or offered by, any domestic office of any commercial
bank organized under the laws of the United States of America or any State
thereof which has a combined capital and surplus and undivided profits of not
less than $500,000,000; and (d) fully collateralized repurchase agreements with
a term of not more than 30 days for securities described in clause (a) of this
definition and entered into with a financial institution satisfying the criteria
described in clause (c) of this definition.
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"Person" means any natural person, corporation, limited liability
company, trust, joint venture, association, company, partnership, Governmental
Authority or other entity.
"Plan" means any employee pension benefit plan (other than a
Multiemployer Plan) subject to the provisions of Title IV of ERISA or Section
412 of the Code or Section 302 of ERISA, and in respect of which the Borrower or
any ERISA Affiliate is (or, if such plan were terminated, would under Section
4069 of ERISA be deemed to be) an "employer" as defined in Section 3(5) of
ERISA.
"Prime Rate" means the rate of interest per annum publicly announced
from time to time by Chase as its prime rate in effect at its principal office
in New York City; each change in the Prime Rate shall be effective from and
including the date such change is publicly announced as being effective.
"Principal Payment Dates" means, with respect to each Class of Term
Loans, the Quarterly Dates falling on or nearest to March 31, June 30, September
30 and December 31 of each year, commencing with December 31, 1999, through and
including the respective Term Loan Maturity Date for such Class.
"Quarterly Dates" means the last Business Day of March, June,
September and December in each year, the first of which shall be the first such
day after the date hereof.
"Register" has the meaning set forth in Section 10.04.
"Related Parties" means, with respect to any specified Person, such
Person's Affiliates and the respective directors, officers, employees, agents
and advisors of such Person and such Person's Affiliates.
"Release" means any release, threatened release, spill, emission,
leaking, pumping, injection, deposit, disposal, discharge, dispersal, leaching
or migration into the indoor or outdoor environment, including the movement of
Hazardous Materials through ambient air, soil, surface water, ground water,
wetlands, land or subsurface strata.
"Required Lenders" means, at any time, Revolving Credit Lenders
having Revolving Credit Exposures and unused Revolving Credit Commitments, Term
A Lenders having outstanding A Term Loans and unused Term A Loan Commitments and
Term Loan B Lenders having outstanding B Term Loans and unused Term Loan B
Commitments, representing more than 50% of the sum of the total outstanding
Revolving Credit Exposures, the Term Loans and unused Commitments at such time.
The "Required Lenders" of a particular Class of Loans means Lenders having
Revolving Credit Exposures, outstanding Term Loans and unused
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Commitments of such Class representing more than 50% of the total Revolving
Credit Exposures, outstanding Term Loans and unused Commitments of such Class at
such time.
"Restricted Payment" means any dividend or other distribution
(whether in cash, securities or other property) with respect to any shares of
any class of capital stock of the Borrower or any of its Subsidiaries, or any
payment (whether in cash, securities or other property), including any sinking
fund or similar deposit, on account of the purchase, redemption, retirement,
acquisition, cancellation or termination of any such shares of capital stock or
any option, warrant or other right to acquire any such shares of capital stock.
"Revolving Credit Availability Period" means the period from and
including the Effective Date to but excluding the earlier of the Revolving
Credit Commitment Termination Date and the date of termination of the Revolving
Credit Commitments.
"Revolving Credit Commitment" means, with respect to each Lender,
the commitment, if any, of such Lender to make Revolving Credit Loans and to
acquire participations in Letters of Credit, Swingline Loans and the Foreign
Currency Credits hereunder, expressed as an amount representing the maximum
aggregate amount of such Lender's Revolving Credit Exposure hereunder, as such
commitment may be (a) reduced from time to time pursuant to Section 2.08 or
2.10(b) and (b) reduced or increased from time to time pursuant to assignments
by or to such Lender pursuant to Section 10.04. The initial amount of each
Lender's Revolving Credit Commitment is set forth on Schedule I, or in the
Assignment and Acceptance pursuant to which such Lender shall have assumed its
Revolving Credit Commitment, as applicable. The initial aggregate amount of the
Lenders' Revolving Credit Commitments is $50,000,000.
"Revolving Credit Commitment Termination Date" means the Quarterly
Date falling on or nearest to March 31, 2005.
"Revolving Credit Exposure" means, with respect to any Lender at any
time, the sum of the outstanding principal amount of such Lender's Revolving
Credit Loans and its LC Exposure, Swingline Exposure and Foreign Currency Credit
Exposure at such time.
"Revolving Credit Lender" means a Lender with a Revolving Credit
Commitment or, if the Revolving Credit Commitments have terminated or expired, a
Lender with Revolving Credit Exposure.
"Revolving Credit Loan" means a Loan made pursuant to Section
2.01(a).
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"Security Agreement" means a Security Agreement substantially in the
form of Exhibit B between the Borrower, the Subsidiary Guarantors and the
Administrative Agent.
"Security Documents" means, collectively, the Security Agreement,
the Mortgages, the Guarantee Assumption Agreements, the MVE Guarantee Agreement,
the Foreign Subsidiary Pledge Agreements, such other security agreements, pledge
agreements or similar agreements or instruments as may be required by the terms
of this Agreement, and all Uniform Commercial Code financing statements required
thereby to be filed, or other filings and/or registrations required to be made
or obtained, as the case may be, with respect to the security interests in
personal property and fixtures created pursuant to any of the foregoing
agreements.
"Senior Secured Notes" means the 12 1/2% Senior Secured Notes due
2002 issued pursuant to the Senior Secured Notes Indenture in an aggregate
outstanding principal amount of $112,000,000 as of the date hereof.
"Senior Secured Notes Indenture" means the Indenture dated as of
February 16, 1995 between MVE and American Bank National Association, as
Trustee.
"Statutory Reserve Rate" means, for the Interest Period for any
Eurodollar Borrowing, a fraction (expressed as a decimal), the numerator of
which is the number one and the denominator of which is the number one minus the
arithmetic mean, taken over each day in such Interest Period, of the aggregate
of the maximum reserve percentages (including any marginal, special, emergency
or supplemental reserves) expressed as a decimal established by the Board to
which the Administrative Agent is subject for eurocurrency funding (currently
referred to as "Eurocurrency liabilities" in Regulation D of the Board). Such
reserve percentages shall include those imposed pursuant to such Regulation D.
Eurodollar Loans shall be deemed to constitute eurocurrency funding and to be
subject to such reserve requirements without benefit of or credit for proration,
exemptions or offsets that may be available from time to time to any Lender
under such Regulation D or any comparable regulation. The Statutory Reserve Rate
shall be adjusted automatically on and as of the effective date of any change in
any reserve percentage.
"Subsidiary" means, with respect to any Person (the "parent") at any
date, any corporation, limited liability company, partnership, association or
other entity the accounts of which would be consolidated with those of the
parent in the parent's consolidated financial statements if such financial
statements were prepared in accordance with GAAP as of such date, as well as any
other corporation, limited liability company, partnership, association or other
entity (a) of which securities or other ownership interests representing more
than 50% of the equity or more than 50% of the ordinary voting power or, in the
case of a partnership, more than 50% of the general partnership interests are,
as of such date, owned, controlled or held, or
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(b) that is, as of such date, otherwise Controlled, by the parent or one or more
subsidiaries of the parent or by the parent and one or more subsidiaries of the
parent. Unless otherwise specified, "Subsidiary" means a Subsidiary of the
Borrower. "Wholly Owned Subsidiary" means any such corporation, limited
liability company, partnership, association or other entity of which all of such
securities or other ownership interest (other than in the case of a corporation,
directors' qualifying shares and shares or equity interests required to be held
by foreign nationals, in each case to the extent mandated by applicable law) are
so owned or controlled.
"Subsidiary Borrower" means Chart Marston Limited and/or any other
Subsidiary designated by the Borrower as a Subsidiary Borrower and approved by
the Foreign Currency Lender and the Administrative Agent.
"Subsidiary Guarantor" means each of the Subsidiaries of the
Borrower identified under the caption "SUBSIDIARY GUARANTORS" on the signature
pages hereto and each Subsidiary of the Borrower that becomes a "Subsidiary
Guarantor" on or after the date hereof pursuant to this Agreement (including MVE
as a guarantor under the MVE Guarantee Agreement); provided that,
notwithstanding anything herein to the contrary, the following Subsidiaries
shall not be, or be required to become, Subsidiary Guarantors: (i) CHD and any
of its Subsidiaries; (ii) any Foreign Subsidiary and any of its Subsidiaries;
and (iii) prior to the Bond Tender Offer Closing Date, MVE and its Subsidiaries.
"Swingline Exposure" means, at any time, the aggregate principal
amount of all Swingline Loans outstanding at such time. The Swingline Exposure
of any Lender at any time shall be its Applicable Percentage of the total
Swingline Exposure at such time.
"Swingline Lender" means Chase, in its capacity as lender of
Swingline Loans hereunder.
"Swingline Loan" means a Loan made pursuant to Section 2.04(a).
"Syndicated Loans" means, collectively, the Revolving Credit Loans,
Term Loan A and Term Loan B.
"Taxes" means any and all present or future taxes, levies, imposts,
duties, deductions, charges or withholdings imposed by any Governmental
Authority.
"Term Loan A" means, collectively, each A Term Loan.
"Term Loan A Commitment" means, with respect to each Lender, the
commitment, if any, of such Lender to make an A Term Loan hereunder on the
Effective Date,
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expressed as an amount representing the maximum principal amount of the A Term
Loan to be made by such Lender hereunder, as such commitment may be (a) reduced
from time to time pursuant to Section 2.08 or 2.10(b) and (b) reduced or
increased from time to time pursuant to assignments by or to such Lender
pursuant to Section 10.04. The initial amount of each Lender's Term Loan A
Commitment is set forth on Schedule I, or in the Assignment and Acceptance
pursuant to which such Lender shall have assumed its Term Loan A Commitment, as
applicable. The initial aggregate amount of the Lenders' Term Loan A Commitments
is $125,000,000.
"Term Loan A Lender" means a Lender with a Term Loan A Loan
Commitment or an outstanding A Term Loan.
"Term Loan A Maturity Date" means the Quarterly Date falling on or
nearest to March 31, 2005.
"Term Loan B" means, collectively, each B Term Loan.
"Term Loan B Commitment" means, with respect to each Lender, the
commitment, if any, of such Lender to make a Term Loan hereunder on the
Effective Date, expressed as an amount representing the maximum principal amount
of the B Term Loan to be made by such Lender hereunder, as such commitment may
be (a) reduced from time to time pursuant to Section 2.08 or 2.10(b) and (b)
reduced or increased from time to time pursuant to assignments by or to such
Lender pursuant to Section 10.04. The initial amount of each Lender's Term Loan
B Commitment is set forth on Schedule I, or in the Assignment and Acceptance
pursuant to which such Lender shall have assumed its Term Loan B Commitment, as
applicable. The initial aggregate amount of the Lenders' Term Loan B Commitments
is $125,000,000.
"Term Loan B Lender" means a Lender with a Term Loan B Commitment or
an outstanding B Term Loan.
"Term Loan B Maturity Date" means the Quarterly Date falling on or
nearest to March 31, 2006.
"Term Loan Commitments" means, collectively, the Term Loan A
Commitments and the Term Loan B Commitments.
"Term Loan Maturity Date" means, with respect to each Class of Term
Loans, the Term Loan A Maturity Date or the Term Loan B Maturity Date, as
applicable.
"Term Loans" means, collectively, the Term Loan A and the Term Loan
B.
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"Transactions" means the execution, delivery and performance by each
Obligor of this Agreement and the other Basic Documents to which such Obligor is
intended to be a party, the borrowing of Loans, the use of the proceeds thereof,
the issuance of Letters of Credit hereunder, and the consummation of the
Acquisition and the other transactions contemplated by the Acquisition
Documents.
"Type", when used in reference to any Loan or Borrowing, refers to
whether the rate of interest on such Loan, or on the Loans constituting such
Borrowing, is determined by reference to the Adjusted LIBO Rate or the Alternate
Base Rate.
"Uniform Commercial Code" means the Uniform Commercial Code as in
effect from time to time in the State of New York.
"Withdrawal Liability" means liability to a Multiemployer Plan as a
result of a complete or partial withdrawal from such Multiemployer Plan, as such
terms are defined in Part I of Subtitle E of Title IV of ERISA.
SECTION 1.02. Classification of Loans and Borrowings. For purposes
of this Agreement, Loans may be classified and referred to by Class (e.g., a
"Revolving Credit Loan"), by Type (e.g., an "ABR Loan") or by Class and Type
(e.g., a "Revolving Credit ABR Loan"). Borrowings also may be classified and
referred to by Class (e.g., a "Revolving Credit Borrowing"), by Type (e.g., an
"ABR Borrowing") or by Class and Type (e.g., a "Revolving Credit ABR
Borrowing"). When used in relation to a Loan or Borrowing, "Syndicated" refers
to any Loan or Borrowing (other than the Swingline Loans and Foreign Currency
Credits).
SECTION 1.03. Terms Generally. The definitions of terms herein
shall apply equally to the singular and plural forms of the terms defined.
Whenever the context may require, any pronoun shall include the corresponding
masculine, feminine and neuter forms. The words "include", "includes" and
"including" shall be deemed to be followed by the phrase "without limitation".
The word "will" shall be construed to have the same meaning and effect as the
word "shall". Unless the context requires otherwise (a) any definition of or
reference to any agreement, instrument or other document herein shall be
construed as referring to such agreement, instrument or other document as from
time to time amended, supplemented or otherwise modified (subject to any
restrictions on such amendments, supplements or modifications set forth herein),
(b) any reference herein to any Person shall be construed to include such
Person's successors and assigns, (c) the words "herein", "hereof" and
"hereunder", and words of similar import, shall be construed to refer to this
Agreement in its entirety and not to any particular provision hereof, (d) all
references herein to Articles, Sections, Exhibits and Schedules shall be
construed to refer to Articles and Sections of, and Exhibits and Schedules to,
this Agreement and (e) the words "asset" and "property" shall be construed to
have the same
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meaning and effect and to refer to any and all tangible and intangible assets
and properties, including cash, securities, accounts and contract rights.
SECTION 1.04. Accounting Terms; GAAP. Except as otherwise expressly
provided herein, all terms of an accounting or financial nature shall be
construed in accordance with GAAP, as in effect from time to time; provided
that, if the Borrower notifies the Administrative Agent that the Borrower
requests an amendment to any provision hereof to eliminate the effect of any
change occurring after the date hereof in GAAP or in the application thereof on
the operation of such provision (or if the Administrative Agent notifies the
Borrower that the Required Lenders request an amendment to any provision hereof
for such purpose), regardless of whether any such notice is given before or
after such change in GAAP or in the application thereof, then such provision
shall be interpreted on the basis of GAAP as in effect and applied immediately
before such change shall have become effective until such notice shall have been
withdrawn or such provision amended in accordance herewith.
ARTICLE II
THE CREDITS
SECTION 2.01. The Commitments.
(a) Revolving Credit Loans. Subject to the terms and conditions set
forth herein, each Revolving Credit Lender agrees to make Revolving Credit Loans
to the Borrower from time to time during the Revolving Credit Availability
Period in an aggregate principal amount that will not result in (i) such
Revolving Credit Lender's Revolving Credit Exposure exceeding such Lender's
Revolving Credit Commitment or (ii) the total Revolving Credit Exposures
exceeding the total Revolving Credit Commitments. Within the foregoing limits
and subject to the terms and conditions set forth herein, the Borrower may
borrow, prepay and reborrow Revolving Credit Loans. For purposes of determining
the Revolving Credit Exposure of the Lenders at any time, the Dollar Equivalent
amount of each Foreign Currency Credit then outstanding shall be determined on
the basis of such amount as most recently determined in accordance with Section
2.04(b) and notified to the Administrative Agent.
(b) Term Loan A. Subject to the terms and conditions set forth
herein, each Term Loan A Lender agrees to make an A Term Loan to the Borrower on
the Effective Date in a principal amount equal to its Term Loan A Commitment.
Amounts repaid in respect of the Term Loan A may not be reborrowed.
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(c) Term Loan B. Subject to the terms and conditions set forth
herein, each Term Loan B Lender agrees to make a B Term Loan to the Borrower on
the Effective Date in a principal amount equal to its Term Loan B Commitment.
Amounts repaid in respect of the Term Loan B may not be reborrowed.
SECTION 2.02. Loans and Borrowings.
(a) Obligations of Lenders. Each Syndicated Loan shall be made as
part of a Borrowing consisting of Loans of the same Class and Type made by the
Lenders ratably in accordance with their respective Commitments of the
applicable Class. The failure of any Lender to make any Loan required to be made
by it shall not relieve any other Lender of its obligations hereunder; provided
that the Commitments of the Lenders are several and no Lender shall be
responsible for any other Lender's failure to make Loans as required.
(b) Type of Loans. Subject to Section 2.13, each Syndicated
Borrowing shall be constituted entirely of ABR Loans or Eurodollar Loans as the
Borrower may request in accordance herewith. Each Swingline Loan shall be an ABR
Loan. Each Lender at its option may make any Eurodollar Loan by causing any
domestic or foreign branch or Affiliate of such Lender to make such Loan;
provided that any exercise of such option shall not affect the obligation of the
Borrower to repay such Loan in accordance with the terms of this Agreement.
(c) Minimum Amounts; Limitation on Number of Borrowings. At the
commencement of the Interest Period for any Eurodollar Borrowing, such Borrowing
shall be in an aggregate amount of $2,500,000 or a larger multiple of $500,000.
At the time that each Syndicated ABR Borrowing is made, such Borrowing shall be
in an aggregate amount equal to $2,500,000 or a larger multiple of $250,000;
provided that a Syndicated ABR Borrowing may be in an aggregate amount that is
equal to the entire unused balance of the total Commitments of the applicable
Class or (in the case of a Revolving Credit ABR Borrowing) that is required to
finance the reimbursement of an LC Disbursement as contemplated by Section
2.05(f). Each Swingline Loan shall be in an amount equal to $1,000,000 or a
larger multiple of $250,000. Borrowings of more than one Type and Class may be
outstanding at the same time; provided that there shall not at any time be more
than a total of fifteen Eurodollar Borrowings outstanding.
SECTION 2.03. Requests for Syndicated Borrowings. To request a
Syndicated Borrowing, the Borrower shall notify the Administrative Agent of such
request by telephone (a) in the case of a Eurodollar Borrowing, not later than
11:00 a.m., New York City time, three Business Days before the date of the
proposed Borrowing or (b) in the case of a Syndicated ABR Borrowing, not later
than 11:00 a.m., New York City time, one Business Day before the date of the
proposed Borrowing; provided that any such notice of a Revolving Credit ABR
Borrowing to
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finance the reimbursement of an LC Disbursement as contemplated by Section
2.05(f) may be given not later than 10:00 a.m., New York City time, on the date
of the proposed Borrowing. Each such telephonic Borrowing Request shall be
irrevocable and shall be confirmed promptly by hand delivery or telecopy to the
Administrative Agent of a written Borrowing Request in a form approved by the
Administrative Agent and signed by the Borrower. Each such telephonic and
written Borrowing Request shall specify the following information in compliance
with Section 2.02:
(i) whether the requested Borrowing is to be a Revolving Credit
Borrowing, Term Loan A Borrowing or Term Loan B Borrowing;
(ii) the aggregate amount of the requested Borrowing;
(iii) the date of such Borrowing, which shall be a Business Day;
(iv) whether such Borrowing is to be an ABR Borrowing or a
Eurodollar Borrowing;
(v) in the case of a Eurodollar Borrowing, the Interest Period
therefor, which shall be a period contemplated by the definition of the
term "Interest Period"; and
(vi) the location and number of the Borrower's account to which
funds are to be disbursed, which shall comply with the requirements of
Section 2.06.
If no election as to the Type of Syndicated Borrowing is specified, then the
requested Syndicated Borrowing shall be an ABR Borrowing. If no Interest Period
is specified with respect to any requested Eurodollar Borrowing, then the
Borrower shall be deemed to have selected an Interest Period of one month's
duration. Promptly following receipt of a Borrowing Request in accordance with
this Section, the Administrative Agent shall advise each Lender of the details
thereof and of the amount of such Lender's Loan to be made as part of the
requested Borrowing.
SECTION 2.04. Swingline Loans; Foreign Currency Credits.
(a) Swingline Loans
(i) Agreement to Make Swingline Loans. Subject to the terms
and conditions set forth herein, the Swingline Lender agrees to make
Swingline Loans to the Borrower from time to time during the
Revolving Credit Availability Period, in an aggregate principal
amount at any time outstanding that will not result in (i) the
aggregate principal amount of outstanding Swingline Loans
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exceeding $10,000,000 or (ii) the total Revolving Credit Exposures
exceeding the total Revolving Credit Commitments; provided that the
Swingline Lender shall not be required to make a Swingline Loan to
refinance an outstanding Swingline Loan. Within the foregoing limits
and subject to the terms and conditions set forth herein, the
Borrower may borrow, prepay and reborrow Swingline Loans.
(ii) Notice of Swingline Loans by the Borrower. To request a
Swingline Loan, the Borrower shall notify the Administrative Agent
of such request by telephone (confirmed by telecopy), not later than
12:00 noon, New York City time, on the day of a proposed Swingline
Loan. Each such notice shall be irrevocable and shall specify the
requested date (which shall be a Business Day) and amount of the
requested Swingline Loan. The Administrative Agent will promptly
advise the Swingline Lender of any such notice received from the
Borrower. The Swingline Lender shall make each Swingline Loan
available to the Borrower by means of a credit to the general
deposit account of the Borrower with the Swingline Lender (or, in
the case of a Swingline Loan made to finance the reimbursement of an
LC Disbursement as provided in Section 2.05(f), by remittance to the
relevant Issuing Lender) by 3:00 p.m., New York City time, on the
requested date of such Swingline Loan.
(iii) Participations by Lenders in Swingline Loans. The
Swingline Lender may by written notice given to the Administrative
Agent not later than 10:00 a.m., New York City time, on any Business
Day require the Lenders to acquire participations on such Business
Day in all or a portion of the Swingline Loans outstanding. Such
notice to the Administrative Agent shall specify the aggregate
amount of Swingline Loans in which Revolving Credit Lenders will
participate. Promptly upon receipt of such notice, the
Administrative Agent will give notice thereof to each Revolving
Credit Lender, specifying in such notice such Revolving Credit
Lender's Applicable Percentage of such Swingline Loan or Loans. Each
Revolving Credit Lender hereby absolutely and unconditionally
agrees, upon receipt of notice as provided above in this paragraph,
to pay to the Administrative Agent, for account of the Swingline
Lender, such Revolving Credit Lender's Applicable Percentage of such
Swingline Loan or Loans. Each Revolving Credit Lender acknowledges
and agrees that its obligation to acquire participations in
Swingline Loans pursuant to this paragraph is absolute and
unconditional and shall not be affected by any circumstance
whatsoever, including the occurrence and continuance of a Default or
reduction or termination of the Commitments, and that each such
payment shall be made without any offset, abatement, withholding or
reduction whatsoever. Each Revolving Credit Lender shall comply with
its obligation under this paragraph by wire transfer of
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immediately available funds, in the same manner as provided in
Section 2.06 with respect to Loans made by such Revolving Credit
Lender (and Section 2.06 shall apply, mutatis mutandis, to the
payment obligations of the Revolving Credit Lenders), and the
Administrative Agent shall promptly pay to the Swingline Lender the
amounts so received by it from the Revolving Credit Lenders. The
Administrative Agent shall notify the Borrower of any participations
in any Swingline Loan acquired pursuant to this paragraph, and
thereafter payments in respect of such Swingline Loan shall be made
to the Administrative Agent and not to the Swingline Lender. Any
amounts received by the Swingline Lender from the Borrower (or other
party on behalf of the Borrower) in respect of a Swingline Loan
after receipt by the Swingline Lender of the proceeds of a sale of
participations therein shall be promptly remitted to the
Administrative Agent; any such amounts received by the
Administrative Agent shall be promptly remitted by the
Administrative Agent to the Revolving Credit Lenders that shall have
made their payments pursuant to this paragraph and to the Swingline
Lender, as their interests may appear. The purchase of
participations in a Swingline Loan pursuant to this paragraph shall
not relieve the Borrower of any default in the payment thereof.
Notwithstanding the foregoing, a Revolving Credit Lender shall not
have any obligation to acquire a participation in a Swingline Loan
pursuant to this paragraph if a Default shall have occurred and be
continuing at the time such Swingline Loan was made and such
Revolving Credit Lender shall have notified the Swingline Lender in
writing, at least one Business Day prior to the time such Swingline
Loan was made, that such Default has occurred and that such
Revolving Credit Lender will not acquire participations in Swingline
Loans made while such Default is continuing.
(b) Foreign Currency Extensions of Credit.
(i) Agreement to Make Foreign Currency Credits. Subject to the
terms and conditions set forth herein, the Foreign Currency Lender
agrees to make Foreign Currency Credits, in minimum amounts to be
agreed upon from time to time between the Foreign Currency Lender
and the relevant Subsidiary Borrower, by means of advances or the
issuance of letters of credit, bank guaranties or similar
instruments, in Foreign Currencies to the relevant Subsidiary
Borrower from time to time during the Revolving Credit Availability
Period, in an aggregate principal amount at any time outstanding
that will not result in (A) the Dollar Equivalent of the aggregate
principal amount of outstanding Foreign Currency Credits exceeding
$10,000,000 or (B) the total Revolving Credit Exposures exceeding
the total Revolving Credit Commitments, provided that (I) except as
provided in sub-clause (II) below, the Foreign Currency Lender will
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determine the Dollar Equivalent of each Foreign Currency Credit as
of the date of the making or issuance of such Foreign Currency
Credit and the last Business Day of each month (and the Foreign
Currency Lender may make such determination at such other time as it
shall determine) and will promptly advise the Administrative Agent
of each such determination and (II) if the total Revolving Credit
Exposure (as most recently determined pursuant to sub-clause (I)
above) is greater than the sum of the total Revolving Credit
Commitments minus $5,000,000, then the Administrative Agent will
notify the Foreign Currency Lender and, so long as such condition
continues, the Foreign Currency Lender will determine the Dollar
Equivalent of the Foreign Currency Credits on each Business Day and
will advise the Administrative Agent thereof. If upon the
calculation of the Dollar Equivalent of the Foreign Currency Credits
pursuant to the immediately preceding sentence the total Revolving
Credit Exposure exceeds the Revolving Credit Commitments the
Borrower will promptly prepay Revolving Credit Loans in an aggregate
principal amount at least equal to such excess (but in any event in
an amount at least equal to $1,000,000). Within the foregoing limits
and subject to the terms and conditions set forth herein, the
Subsidiary Borrowers may borrow, prepay and reborrow Foreign
Currency Credits.
(ii) Notice of Foreign Currency Credits by the Borrower. To
request a Foreign Currency Credit, the relevant Subsidiary Borrower
shall notify the Foreign Currency Lender in accordance with the
notice and other procedures agreed upon between the Foreign Currency
Lender and such Subsidiary Borrower. Each such notice shall be
irrevocable and shall specify the requested date (which shall be a
Business Day), tenor (which shall not be later than the Revolving
Credit Commitment Termination Date), currency, amount of the
requested Foreign Currency Credit and the type of such Foreign
Currency Credit (and, with respect to any letter of credit, bank
guaranty or similar instrument, such notice shall be accompanied by
such additional information and documentation as the Foreign
Currency Lender shall reasonably require). The Foreign Currency
Lender will promptly advise the Administrative Agent of the making
and amount (and Dollar Equivalent as of the date made) of each
Foreign Currency Credit.
(iii) Refunding of Foreign Currency Credit. The Foreign
Currency Lender may, upon at least three Business Days' prior
written notice given to the Administrative Agent require the
Revolving Credit Lenders to acquire participations in all or a
portion of the Foreign Currency Credits outstanding. Such notice to
the Administrative Agent shall specify the date of such acquisition
and the aggregate amount, type and currency of Foreign Currency
Credits in which the Revolving Credit Lenders will participate.
Promptly upon receipt of
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such notice, the Administrative Agent will give notice thereof to
each Revolving Credit Lender, specifying in such notice such
Lender's Applicable Percentage of such Foreign Currency Credit or
Credits. Each Revolving Credit Lender hereby absolutely and
unconditionally agrees, upon receipt of notice as provided above in
this paragraph, to pay to the Administrative Agent, for account of
the Foreign Currency Lender, such Revolving Credit Lender's
Applicable Percentage of such Foreign Currency Credit or Credits in
accordance with the second succeeding sentence. Each Revolving
Credit Lender acknowledges and agrees that its obligation to acquire
participations in Foreign Currency Credits pursuant to this
paragraph is absolute and unconditional and shall not be affected by
any circumstance whatsoever, including the occurrence and
continuance of a Default or reduction or termination of the
Commitments, and that each such payment shall be made without any
offset, abatement, withholding or reduction whatsoever. Each
Revolving Credit Lender shall comply with its obligation under this
paragraph by wire transfer to the Administrative Agent of
immediately available funds, in Dollars in an amount equal to such
Revolving Credit Lender's Applicable Percentage of the Dollar
Equivalent of such Foreign Currency Credit or Credits and otherwise
in the manner as provided in Section 2.06 with respect to Loans made
by such Revolving Credit Lender (and Section 2.06 shall apply,
mutatis mutandis, to the payment obligations of the Revolving Credit
Lenders); provided that after giving effect to the purchase of such
participations such Revolving Credit Lender's Revolving Credit
Exposure will not exceed such Lender's Revolving Credit Commitment.
The Administrative Agent (or any agent as the Administrative Agent
shall designate for this purpose) shall promptly pay to the Foreign
Currency Lender the amounts in Dollars so received by it from the
Lenders. The Administrative Agent shall notify the Borrower of any
participations in any Foreign Currency Credit acquired pursuant to
this paragraph, and thereafter such Foreign Currency Credit shall be
deemed for all purposes hereof to be a Revolving Credit Loan
denominated in Dollars (which initially shall be an ABR Loan) and
payments in respect of such Revolving Credit Loan shall be made by
the Borrower in Dollars to the Administrative Agent for account of
the Revolving Credit Lenders and not to the Foreign Currency Lender.
Any amounts received by the Foreign Currency Lender from such
Subsidiary Borrower (or other party on behalf of such Subsidiary
Borrower) in respect of a Foreign Currency Credit after receipt by
the Foreign Currency Lender of the proceeds of a sale of
participations therein shall be promptly remitted in Dollars to the
Administrative Agent; any such amounts received by the
Administrative Agent shall be promptly remitted by the
Administrative Agent to the Revolving Credit Lenders that shall have
made their payments pursuant to this paragraph and to the Foreign
Currency Lender, as their interests may appear. The purchase of
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participations in a Foreign Currency Credit pursuant to this
paragraph shall not relieve any Subsidiary Borrower of any default
in the payment thereof. Notwithstanding the foregoing, a Revolving
Credit Lender shall not have any obligation to acquire a
participation in a Foreign Currency Credit pursuant to this
paragraph if a Default shall have occurred and be continuing at the
time such Foreign Currency Credit was made and such Revolving Credit
Lender shall have notified the Foreign Currency Lender in writing,
at least one Business Day prior to the time such Foreign Currency
Credit was made, that such Default has occurred and that such
Revolving Credit Lender will not acquire participations in Foreign
Currency Credits made while such Default is continuing.
SECTION 2.05. Letters of Credit.
(a) General. Subject to the terms and conditions set forth herein,
in addition to the Loans provided for in Section 2.01, the Borrower may request
an Issuing Lender to issue, at any time and from time to time during the
Revolving Credit Availability Period, one or more Letters of Credit for its own
account denominated in Dollars and in such form as is acceptable to such Issuing
Lender in its reasonable determination. Letters of Credit issued hereunder shall
constitute utilization of the Revolving Credit Commitments.
(b) Notice of Issuance, Amendment, Renewal or Extension. To request
the issuance of a Letter of Credit (or the amendment, renewal or extension of an
outstanding Letter of Credit), the Borrower shall hand deliver or telecopy (or
transmit by electronic communication, if arrangements for doing so have been
approved by the relevant Issuing Lender) to the relevant Issuing Lender and the
Administrative Agent (reasonably in advance of the requested date of issuance,
amendment, renewal or extension) a notice requesting the issuance of a Letter of
Credit, or identifying the Letter of Credit to be amended, renewed or extended,
and specifying the date of issuance, amendment, renewal or extension (which
shall be a Business Day), the date on which such Letter of Credit is to expire
(which shall comply with Section 2.05(d)), the amount of such Letter of Credit,
the name and address of the beneficiary thereof and such other information as
shall be necessary to prepare, amend, renew or extend such Letter of Credit. If
requested by such Issuing Lender, the Borrower also shall submit a letter of
credit application on such Issuing Lender's standard form in connection with any
request for a Letter of Credit. In the event of any inconsistency between the
terms and conditions of this Agreement and the terms and conditions of any form
of letter of credit application or other agreement submitted by the Borrower to,
or entered into by the Borrower with, the relevant Issuing Lender relating to
any Letter of Credit, the terms and conditions of this Agreement shall control.
(c) Limitations on Amounts. A Letter of Credit shall be issued,
amended, renewed or extended only if (and upon issuance, amendment, renewal or
extension of each Letter
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of Credit the Borrower shall be deemed to represent and warrant that), after
giving effect to such issuance, amendment, renewal or extension (i) the
aggregate LC Exposure of the Issuing Lenders (determined for these purposes
without giving effect to the participations therein of the Revolving Credit
Lenders pursuant to Section 2.05(e)) shall not exceed $25,000,000 and (ii) the
total Revolving Credit Exposures shall not exceed the total Revolving Credit
Commitments.
(d) Expiration Date. Each Letter of Credit shall expire at or prior
to the close of business on the earlier of (i) the date twelve months after the
date of the issuance of such Letter of Credit (or, in the case of any renewal or
extension thereof, twelve months after the then-current expiration date of such
Letter of Credit, so long as such renewal or extension occurs within three
months of such then-current expiration date) and (ii) the date that is five
Business Days prior to the Revolving Credit Commitment Termination Date.
(e) Participations. By the issuance of a Letter of Credit (or an
amendment to a Letter of Credit increasing the amount thereof) by an Issuing
Lender, and without any further action on the part of such Issuing Lender or the
Lenders, such Issuing Lender hereby grants to each Lender, and each Lender
hereby acquires from such Issuing Lender, a participation in such Letter of
Credit equal to such Lender's Applicable Percentage of the aggregate amount
available to be drawn under such Letter of Credit. Each Lender acknowledges and
agrees that its obligation to acquire participations pursuant to this paragraph
in respect of Letters of Credit is absolute and unconditional and shall not be
affected by any circumstance whatsoever, including any amendment, renewal or
extension of any Letter of Credit or the occurrence and continuance of a Default
or reduction or termination of the Commitments, and that each such payment shall
be made without any offset, abatement, withholding or reduction whatsoever.
In consideration and in furtherance of the foregoing, each Lender
hereby absolutely and unconditionally agrees to pay to the Administrative Agent,
for account of the relevant Issuing Lender, such Lender's Applicable Percentage
of each LC Disbursement made by such Issuing Lender promptly upon the request of
such Issuing Lender at any time from the time of such LC Disbursement until such
LC Disbursement is reimbursed by the Borrower or at any time after any
reimbursement payment is required to be refunded to the Borrower for any reason.
Each such payment shall be made in the same manner as provided in Section 2.06
with respect to Loans made by such Lender (and Section 2.06 shall apply, mutatis
mutandis, to the payment obligations of the Lenders), and the Administrative
Agent shall promptly pay to the relevant Issuing Lender the amounts so received
by it from the Lenders. Promptly following receipt by the Administrative Agent
of any payment from the Borrower pursuant to the next following paragraph, the
Administrative Agent shall distribute such payment to the relevant Issuing
Lender or, to the extent that the Lenders have made payments pursuant to this
paragraph to reimburse such Issuing Lender, then to such Lenders and such
Issuing Lender as their interests may appear. Any payment made by a Lender
pursuant to this paragraph to reimburse an Issuing Lender for
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any LC Disbursement shall not constitute a Loan and shall not relieve the
Borrower of its obligation to reimburse such LC Disbursement.
(f) Reimbursement. If an Issuing Lender shall make any LC
Disbursement in respect of a Letter of Credit, the Borrower shall reimburse such
Issuing Lender in respect of such LC Disbursement by paying to the
Administrative Agent an amount equal to such LC Disbursement not later than
12:00 noon, New York City time, on (i) the Business Day that the Borrower
receives notice of such LC Disbursement, if such notice is received prior to
10:00 a.m., New York City time, or (ii) the Business Day immediately following
the day that the Borrower receives such notice, if such notice is not received
prior to such time, provided that, if such LC Disbursement is not less than
$1,000,000, the Borrower may, subject to the conditions to borrowing set forth
herein, request in accordance with Section 2.03 or 2.04 that such payment be
financed with a Revolving Credit ABR Borrowing or Swingline Loan in an
equivalent amount and, to the extent so financed, the Borrower's obligation to
make such payment shall be discharged and replaced by the resulting Revolving
Credit ABR Borrowing or Swingline Loan. If the Borrower fails to make such
payment when due, the Administrative Agent shall notify each Revolving Credit
Lender of the applicable LC Disbursement, the payment then due from the Borrower
in respect thereof and such Lender's Applicable Percentage thereof.
(g) Obligations Absolute. The Borrower's obligation to reimburse LC
Disbursements as provided in paragraph (f) of this Section shall be absolute,
unconditional and irrevocable, and shall be performed strictly in accordance
with the terms of this Agreement under any and all circumstances whatsoever and
irrespective of (i) any lack of validity or enforceability of any Letter of
Credit, or any term or provision therein, (ii) any draft or other document
presented under a Letter of Credit proving to be forged, fraudulent or invalid
in any respect or any statement therein being untrue or inaccurate in any
respect, (iii) payment by any Issuing Lender under a Letter of Credit issued by
it against presentation of a draft or other document that does not comply
strictly with the terms of such Letter of Credit, and (iv) any other event or
circumstance whatsoever, whether or not similar to any of the foregoing, that
might, but for the provisions of this Section, constitute a legal or equitable
discharge of the Borrower's obligations hereunder.
Neither the Administrative Agent, the Lenders nor any Issuing
Lender, nor any of their Related Parties, shall have any liability or
responsibility by reason of or in connection with the issuance or transfer of
any Letter of Credit by any Issuing Lender or any payment or failure to make any
payment thereunder (irrespective of any of the circumstances referred to in the
preceding sentence), or any error, omission, interruption, loss or delay in
transmission or delivery of any draft, notice or other communication under or
relating to any Letter of Credit (including any document required to make a
drawing thereunder), any error in interpretation of technical terms or any
consequence arising from causes beyond the control of any Issuing
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Lender; provided that the foregoing shall not be construed to excuse any Issuing
Lender from liability to the Borrower to the extent of any direct damages (as
opposed to consequential damages, claims in respect of which are hereby waived
by the Borrower to the extent permitted by applicable law) suffered by the
Borrower that are caused by such Issuing Lender's gross negligence or willful
misconduct when determining whether drafts and other documents presented under a
Letter of Credit comply with the terms thereof. The parties hereto expressly
agree that:
(i) any Issuing Lender may accept documents that appear on their
face to be in substantial compliance with the terms of a Letter of Credit
issued by it without responsibility for further investigation, regardless
of any notice or information to the contrary, and may make payment upon
presentation of documents that appear on their face to be in substantial
compliance with the terms of such Letter of Credit;
(ii) any Issuing Lender shall have the right, in its sole
discretion, to decline to accept such documents and to make such payment
if such documents are not in strict compliance with the terms of a Letter
of Credit issued by it; and
(iii) this sentence shall establish the standard of care to be
exercised by the Issuing Lenders when determining whether drafts and other
documents presented under a Letter of Credit comply with the terms thereof
(and the parties hereto hereby waive, to the extent permitted by
applicable law, any standard of care inconsistent with the foregoing).
(h) Disbursement Procedures. Each Issuing Lender shall, within a
reasonable time following its receipt thereof, examine all documents purporting
to represent a demand for payment under a Letter of Credit issued by it. Such
Issuing Lender shall promptly after such examination notify the Administrative
Agent and the Borrower by telephone (confirmed by telecopy) of such demand for
payment and whether such Issuing Lender has made or will make an LC Disbursement
thereunder; provided that any failure to give or delay in giving such notice
shall not relieve the Borrower of its obligation to reimburse such Issuing
Lender and the Lenders with respect to any such LC Disbursement.
(i) Interim Interest. If any Issuing Lender shall make any LC
Disbursement, then, unless the Borrower shall reimburse such LC Disbursement in
full on the date such LC Disbursement is made, the unpaid amount thereof shall
bear interest, for each day from and including the date such LC Disbursement is
made to but excluding the date that the Borrower reimburses such LC
Disbursement, at the rate per annum then applicable to Syndicated ABR Loans;
provided that, if the Borrower fails to reimburse such LC Disbursement when due
pursuant to paragraph (f) of this Section, then Section 2.12(c) shall apply.
Interest accrued
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pursuant to this paragraph shall be for account of the relevant Issuing Lender,
except that interest accrued on and after the date of payment by any Lender
pursuant to paragraph (f) of this Section to reimburse such Issuing Lender shall
be for account of such Lender to the extent of such payment.
(j) Replacement of Issuing Lenders. Any Issuing Lender may be
replaced at any time by written agreement between the Borrower, the
Administrative Agent, the replaced Issuing Lender and a successor Issuing
Lender. The Administrative Agent shall notify the Lenders of any such
replacement of any Issuing Lender. At the time any such replacement shall become
effective, the Borrower shall pay all unpaid fees accrued for account of the
replaced Issuing Lender pursuant to Section 2.11(b). From and after the
effective date of any such replacement, (i) the successor Issuing Lender shall
have all the rights and obligations of the replaced Issuing Lender under this
Agreement with respect to Letters of Credit to be issued thereafter and (ii)
references herein to the term "Issuing Lender" shall be deemed to include such
successor or to any previous Issuing Lender, or to such successor and all
previous Issuing Lenders, as the context shall require. After the replacement of
an Issuing Lender hereunder, the replaced Issuing Lender shall remain a party
hereto and shall continue to have all the rights and obligations of an Issuing
Lender under this Agreement with respect to Letters of Credit issued by it prior
to such replacement, but shall not be required to issue additional Letters of
Credit.
(k) Cash Collateralization. If either (i) an Event of Default shall
occur and be continuing and the Borrower receives notice from the Administrative
Agent or the Required Lenders (or, if the maturity of the Loans has been
accelerated, Lenders with LC Exposure representing more than 50% of the total LC
Exposure) demanding the deposit of cash collateral pursuant to this paragraph,
or (ii) the Borrower shall be required to provide cover for LC Exposure pursuant
to Section 2.10(b), the Borrower shall immediately deposit into the Collateral
Account an amount in cash equal to, in the case of an Event of Default, the LC
Exposure as of such date plus any accrued and unpaid interest thereon and, in
the case of cover pursuant to Section 2.10(b), the amount required under Section
2.10(b), as the case may be; provided that the obligation to deposit such cash
collateral shall become effective immediately, and such deposit shall become
immediately due and payable, without demand or other notice of any kind, upon
the occurrence of any Event of Default with respect to the Borrower described in
clause (h) or (i) of Article VIII. Such deposit shall be held by the
Administrative Agent in the Collateral Account as collateral in the first
instance for the LC Exposure under this Agreement and thereafter for the payment
of the "Secured Obligations" under and as defined in the Security Agreement, and
for these purposes the Borrower hereby grants a security interest to the
Administrative Agent for the benefit of the Lenders in the Collateral Account
and in any financial assets (as defined in the Uniform Commercial Code) or other
property held therein.
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(l) Existing Letters of Credit. Certain letters of credit issued by
National City Bank for account of the Borrower or MVE (or any of their
respective Subsidiaries) and outstanding under the Existing Chart Credit
Agreement or the Existing MVE Credit Agreement, respectively, immediately prior
to the Effective Date, as identified in Schedule IX (collectively, the "Existing
Letters of Credit"), shall be deemed to be a Letter of Credit issued hereunder
and constitute utilization of the Revolving Credit Commitments and, from and
after the Effective Date, shall be governed in all respects by the terms of this
Agreement (including, without limitation, this Section 2.05).
SECTION 2.06. Funding of Borrowings.
(a) Funding by Lenders. Each Lender shall make each Loan to be made
by it hereunder on the proposed date thereof by wire transfer of immediately
available funds by 1:00 noon, New York City time, to the account of the
Administrative Agent most recently designated by it for such purpose by notice
to the Lenders; provided that Swingline Loans shall be made as provided in
Section 2.04(a) and Foreign Currency Credits shall be made as provided in
Section 2.04(b). The Administrative Agent will make such Loans available to the
Borrower by promptly crediting the amounts so received, in like funds, to an
account of the Borrower maintained with the Administrative Agent in New York
City and designated by the Borrower in the applicable Borrowing Request;
provided that Revolving Credit ABR Borrowings made to finance the reimbursement
of an LC Disbursement as provided in Section 2.05(f) shall be remitted by the
Administrative Agent to the relevant Issuing Lender.
(b) Presumption by the Administrative Agent. Unless the
Administrative Agent shall have received notice from a Lender prior to the
proposed date of any Borrowing that such Lender will not make available to the
Administrative Agent such Lender's share of such Borrowing, the Administrative
Agent may assume that such Lender has made such share available on such date in
accordance with paragraph (a) of this Section and may, in reliance upon such
assumption, make available to the Borrower a corresponding amount. In such
event, if a Lender has not in fact made its share of the applicable Borrowing
available to the Administrative Agent, then the applicable Lender and the
Borrower severally agree to pay to the Administrative Agent forthwith on demand
such corresponding amount with interest thereon, for each day from and including
the date such amount is made available to the Borrower to but excluding the date
of payment to the Administrative Agent, at (i) in the case of such Lender, the
Federal Funds Effective Rate or (ii) in the case of the Borrower, the interest
rate applicable to ABR Loans. If such Lender pays such amount to the
Administrative Agent, then such amount shall constitute such Lender's Loan
included in such Borrowing.
(c) Deposit of Term Loan Proceeds into Collateral Account. The
Administrative Agent will cause to be established at a banking institution to be
selected by the Administrative
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Agent a cash collateral account (the "Bond Tender Offer Collateral Account"),
which may be a "securities account" (as defined in Section 8-501 of the Uniform
Commercial Code), in the name and under the sole dominion and control of the
Administrative Agent (and, in the case of a securities account, in respect of
which the Administrative Agent is the "entitlement holder" (as defined in
Section 8-102(a)(7) of the Uniform Commercial Code)), into which there shall be
deposited as of the Effective Date the proceeds of the Term Loans in an
aggregate amount equal to the sum of $125,000,000 minus the aggregate amount of
the Term Loans (if any) that is applied by the Borrower as of the Effective Date
to consummate the Bond Tender Offer, subject to Section 5.03; provided that if
such sum is equal to or less than $15,000,000, such proceeds may be retained by
the Borrower. The balance in the Bond Tender Offer Collateral Account shall be
subject to withdrawal by the Borrower only (i) to consummate the Bond Tender
Offer and only upon satisfaction of each of the conditions specified in Section
5.03 (unless any such condition shall have been waived in accordance with
Section 10.02) or (ii) to prepay the Term Loans in accordance with Section
2.10(b)(vi); provided that if upon the consummation of the Bond Tender Offer
such balance shall be equal to or less than $15,000,000, such amount shall be
paid directly to the Borrower upon its instructions.
SECTION 2.07. Interest Elections.
(a) Elections by the Borrower for Syndicated Borrowings. Each
Syndicated Borrowing initially shall be of the Type specified in the applicable
Borrowing Request and, in the case of a Eurodollar Borrowing, shall have the
Interest Period specified in such Borrowing Request. Thereafter, the Borrower
may elect to convert such Borrowing to a Borrowing of a different Type or to
continue such Borrowing as a Borrowing of the same Type and, in the case of a
Eurodollar Borrowing, may elect the Interest Period therefor, all as provided in
this Section. The Borrower may elect different options with respect to different
portions of the affected Borrowing, in which case each such portion shall be
allocated ratably among the Lenders holding the Loans constituting such
Borrowing, and the Loans constituting each such portion shall be considered a
separate Borrowing. This Section shall not apply to Swingline Borrowings or
Foreign Currency Borrowings, which may not be converted or continued.
(b) Notice of Elections. To make an election pursuant to this
Section, the Borrower shall notify the Administrative Agent of such election by
telephone by the time that a Borrowing Request would be required under Section
2.03 if the Borrower were requesting a Syndicated Borrowing of the Type
resulting from such election to be made on the effective date of such election.
Each such telephonic Interest Election Request shall be irrevocable and shall be
confirmed promptly by hand delivery or telecopy to the Administrative Agent of a
written Interest Election Request in a form approved by the Administrative Agent
and signed by the Borrower.
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(c) Information in Interest Election Requests. Each telephonic and
written Interest Election Request shall specify the following information in
compliance with Section 2.02:
(i) the Borrowing to which such Interest Election Request applies
and, if different options are being elected with respect to different
portions thereof, the portions thereof to be allocated to each resulting
Borrowing (in which case the information to be specified pursuant to
clauses (iii) and (iv) of this paragraph shall be specified for each
resulting Borrowing);
(ii) the effective date of the election made pursuant to such
Interest Election Request, which shall be a Business Day;
(iii) whether the resulting Borrowing is to be an ABR Borrowing or a
Eurodollar Borrowing; and
(iv) if the resulting Borrowing is a Eurodollar Borrowing, the
Interest Period therefor after giving effect to such election, which shall
be a period contemplated by the definition of the term "Interest Period".
If any such Interest Election Request requests a Eurodollar Borrowing but does
not specify an Interest Period, then the Borrower shall be deemed to have
selected an Interest Period of one month's duration.
(d) Notice by the Administrative Agent to Lenders. Promptly
following receipt of an Interest Election Request, the Administrative Agent
shall advise each Lender of the details thereof and of such Lender's portion of
each resulting Borrowing.
(e) Failure to Elect; Events of Default. If the Borrower fails to
deliver a timely Interest Election Request with respect to a Eurodollar
Borrowing prior to the end of the Interest Period therefor, then, unless such
Borrowing is repaid as provided herein, at the end of such Interest Period such
Borrowing shall be converted to a Syndicated ABR Borrowing. Notwithstanding any
contrary provision hereof, if an Event of Default has occurred and is continuing
and the Administrative Agent, at the request of the Required Lenders, so
notifies the Borrower, then, so long as an Event of Default is continuing (i) no
outstanding Syndicated Borrowing may be converted to or continued as a
Eurodollar Borrowing and (ii) unless repaid, each Eurodollar Borrowing shall be
converted to a Syndicated ABR Borrowing at the end of the Interest Period
therefor.
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(f) Limitations on Lengths of Interest Periods. Notwithstanding any
other provision of this Agreement, the Borrower shall not be entitled to
request, or to elect to convert to or continue as a Eurodollar Borrowing: (i)
any Revolving Credit Borrowing if the Interest Period requested therefor would
end after the Revolving Credit Commitment Termination Date; (ii) any Term
Borrowing if the Interest Period requested therefor would end after the Term
Loan Maturity Date for the relevant Class; or (iii) any Term Borrowing if the
Interest Period requested therefor would commence before and end after any
Principal Payment Date for any Class unless, after giving effect thereto, the
aggregate principal amount of the Term Loan A or Term Loan B, as the case may
be, having Interest Periods that end after such Principal Payment Date shall be
equal to or less than the aggregate principal amount of the Term Loan A or Term
Loan B, respectively, permitted to be outstanding after giving effect to the
payments of principal required to be made on such Principal Payment Date.
SECTION 2.08. Termination and Reduction of the Commitments.
(a) Scheduled Termination. Unless previously terminated, (i) the
Term Loan Commitments of each Class shall terminate at 5:00 p.m., New York City
time, on the Effective Date, and (ii) the Revolving Credit Commitments shall
terminate on the Revolving Credit Commitment Termination Date.
(b) Voluntary Termination or Reduction. The Borrower may at any time
terminate, or from time to time reduce, the Commitments of any Class; provided
that (i) each reduction of the Commitments of any Class pursuant to this Section
shall be in an amount that is $5,000,000 or a larger multiple of $1,000,000 and
(ii) the Borrower shall not terminate or reduce the Revolving Credit Commitments
if, after giving effect to any concurrent prepayment of the Revolving Credit
Loans in accordance with Section 2.10, the total Revolving Credit Exposures
would exceed the total Revolving Credit Commitments.
(c) Notice of Voluntary Termination or Reduction. The Borrower shall
notify the Administrative Agent of any election to terminate or reduce the
Commitments of any Class under paragraph (b) of this Section at least three
Business Days prior to the effective date of such termination or reduction,
specifying such election and the effective date thereof. Promptly following
receipt of any notice, the Administrative Agent shall advise the Lenders of the
contents thereof. Each notice delivered by the Borrower pursuant to this Section
shall be irrevocable; provided that a notice of termination of the Revolving
Credit Commitments delivered by the Borrower may state that such notice is
conditioned upon the effectiveness of other credit facilities, in which case
such notice may be revoked by the Borrower (by notice to the Administrative
Agent on or prior to the specified effective date) if such condition is not
satisfied.
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(d) Effect of Termination or Reduction. Any termination or reduction
of the Commitments of any Class shall be permanent. Each reduction of the
Commitments of any Class shall be made ratably among the Lenders in accordance
with their respective Commitments of such Class.
SECTION 2.09. Repayment of Loans; Evidence of Debt.
(a) Repayment. The Borrower hereby unconditionally promises to pay
the Loans as follows:
(i) to the Administrative Agent for account of the Revolving Credit
Lenders the outstanding principal amount of the Revolving Credit Loans on
the Revolving Credit Commitment Termination Date;
(ii) to the Administrative Agent for account of the Term A Lenders
the outstanding principal amount of the Term Loan A on each Principal
Payment Date set forth below in the aggregate principal amount set forth
opposite such Principal Payment Date (subject to adjustment pursuant to
paragraph (b) of this Section):
Principal Payment Date Amount ($)
---------------------- ----------
December 31, 1999 2,500,000
March 31, 2000 2,500,000
June 30, 2000 2,500,000
September 30, 2000 2,500,000
December 31, 2000 2,500,000
March 31, 2001 2,500,000
June 30, 2001 5,000,000
September 30, 2001 5,000,000
December 31, 2001 5,000,000
March 31, 2002 5,000,000
June 30, 2002 6,250,000
September 30, 2002 6,250,000
December 31, 2002 6,250,000
March 31, 2003 6,250,000
June 30, 2003 7,500,000
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September 30, 2003 7,500,000
December 31, 2003 7,500,000
March 31, 2004 7,500,000
June 30, 2004 8,750,000
September 30, 2004 8,750,000
December 31, 2004 8,750,000
Term Loan A Maturity Date 8,750,000;
(iii) to the Administrative Agent for account of the Term Loan B
Lenders the outstanding principal amount of the Term Loan B on each
Principal Payment Date set forth below in the aggregate principal amount
set forth opposite such Principal Payment Date (subject to adjustment
pursuant to paragraph (b) of this Section):
Principal Payment Date Amount ($)
---------------------- ----------
December 31, 1999 312,500
March 31, 2000 312,500
June 30, 2000 312,500
September 30, 2000 312,500
December 31, 2000 312,500
March 31, 2001 312,500
June 30, 2001 312,500
September 30, 2001 312,500
December 31, 2001 312,500
March 31, 2002 312,500
June 30, 2002 312,500
September 30, 2002 312,500
December 31, 2002 312,500
March 31, 2003 312,500
June 30, 2003 312,500
September 30, 2003 312,500
December 31, 2003 312,500
March 31, 2004 312,500
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June 30, 2004 312,500
September 30, 2004 312,500
December 31, 2004 312,500
March 31, 2005 312,500
June 30, 2005 29,531,250
September 30, 2005 29,531,250
December 31, 2005 29,531,250
Term Loan B Maturity Date 29,531,250;
(iv) to the Swingline Lender the then unpaid principal amount of
each Swingline Loan on the earlier of the Revolving Credit Commitment
Termination Date and the first date after such Swingline Loan is made that
is the 15th or last day of a calendar month and is at least two Business
Days after such Swingline Loan is made; provided that on each date that a
Revolving Credit Borrowing is made, the Borrower shall repay all Swingline
Loans then outstanding; and
(v) to the Foreign Currency Lender the unpaid principal amount of
each Foreign Currency Credit on the date(s) agreed upon in writing between
the relevant Subsidiary Borrower and the Foreign Currency Lender (which
date(s) shall not be later than the Revolving Credit Commitment
Termination Date).
(b) Adjustment of Amortization Schedule. Any prepayment of a Term
Loan of either Class shall be applied to reduce ratably the remaining scheduled
installments of such Term Loan. To the extent not previously paid, all Term
Loans of each Class shall be due and payable on the Term Loan Maturity Date for
such Class.
(c) Manner of Payment. Prior to any repayment or prepayment of any
Borrowings of any Class hereunder, the Borrower shall select the Borrowing or
Borrowings of the applicable Class to be paid and shall notify the
Administrative Agent by telephone (confirmed by telecopy) of such selection not
later than 11:00 a.m., New York City time, three Business Days before the
scheduled date of such repayment; provided that each repayment of Borrowings of
any Class shall be applied to repay any outstanding ABR Borrowings of such Class
before any other Borrowings of such Class. If the Borrower fails to make a
timely selection of the Borrowing or Borrowings to be repaid or prepaid, such
payment shall be applied, first, to pay any outstanding ABR Borrowings of the
applicable Class and, second, to other Borrowings of such Class in the order of
the remaining duration of their respective Interest Periods (the Borrowing with
the shortest remaining Interest Period to be repaid first). Each
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payment of a Syndicated Borrowing shall be applied ratably to the Loans included
in such Borrowing.
(d) Maintenance of Loan Accounts by the Lenders. Each Lender shall
maintain in accordance with its usual practice an account or accounts evidencing
the indebtedness of the Borrower to such Lender resulting from each Loan made by
such Lender, including the amounts of principal and interest payable and paid to
such Lender from time to time hereunder.
(e) Maintenance of Loan Accounts by the Administrative Agent. The
Administrative Agent shall maintain accounts in which it shall record (i) the
amount of each Loan made hereunder, the Class and Type thereof and each Interest
Period therefor, (ii) the amount of any principal or interest due and payable or
to become due and payable from the Borrower to each Lender hereunder and (iii)
the amount of any sum received by the Administrative Agent hereunder for account
of the Lenders and each Lender's share thereof.
(f) Effect of Entries. The entries made in the accounts maintained
pursuant to paragraph (d) or (e) of this Section shall be prima facie evidence
of the existence and amounts of the obligations recorded therein; provided that
the failure of any Lender or the Administrative Agent to maintain such accounts
or any error therein shall not in any manner affect the obligation of the
Borrower to repay the Loans in accordance with the terms of this Agreement.
(g) Promissory Notes. Any Lender may request that Loans of any Class
made by it be evidenced by a promissory note. In such event, the Borrower (or in
the case of the Foreign Currency Credits, the relevant Subsidiary Borrower)
shall prepare, execute and deliver to such Lender a promissory note payable to
the order of such Lender (or, if requested by such Lender, to such Lender and
its registered assigns) and in a form approved by the Administrative Agent (or
in the case of the Foreign Currency Credits, the Foreign Currency Lender).
Thereafter, the Loans evidenced by such promissory note and interest thereon
shall at all times (including after assignment pursuant to Section 10.04) be
represented by one or more promissory notes in such form payable to the order of
the payee named therein (or, if such promissory note is a registered note, to
such payee and its registered assigns).
SECTION 2.10. Prepayment of Loans.
(a) Optional Prepayments. The Borrower shall have the right at any
time and from time to time to prepay any Borrowing in whole or in part, subject
to the requirements of this Section. Any prepayment of the Term Loans of either
Class pursuant to this paragraph shall be applied ratably (i) among the Classes
of Term Loans in accordance with the aggregate amount of the outstanding Term
Loans of such Class (if any) and (ii) with respect to each class of Term Loans,
to the remaining scheduled installments thereof.
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(b) Mandatory Prepayments
(i) Casualty Events. Following the receipt by the Borrower of the
proceeds of insurance, condemnation award or other compensation in respect
of any Casualty Event affecting any property of the Borrower or any of its
Subsidiaries, the Borrower shall prepay the Loans (and/or provide cover
for LC Exposure as specified in Section 2.05(k)), and/or the Commitments
shall be subject to automatic reduction, in an aggregate amount, if any,
equal to 100% of the Net Available Proceeds of such Casualty Event to the
extent required by the next paragraph of this clause (i), such prepayment
and/or reduction to be effected in each case in the manner and to the
extent specified in clause (vii) of this paragraph.
Notwithstanding anything herein or in any Security Document to the
contrary, the Borrower shall be required to make a prepayment in respect
of any Casualty Event pursuant to this clause (i) as follows:
(x) The first $50,000,000 in the aggregate of Net Available
Proceeds of Casualty Events may be used by the Borrower or any of
its Subsidiaries to repair or replace the property affected by the
relevant Casualty Event, provided that all such amounts in excess of
$10,000,000 in the aggregate shall be deposited by the Borrower or
the relevant Subsidiary into the relevant cash collateral account
(in the case of property covered by the Security Agreement) or the
Restoration Account (as defined in the relevant Mortgage) or similar
account (in the case of property covered by a Mortgage) and shall be
disbursed by the Administrative Agent (or mortgagee, as the case may
be) upon request and certification by the Borrower that such amounts
are to be used to repair or replace the property affected by the
relevant Casualty Event, and provided further, if at any time the
Borrower determines that it shall not repair or replace such
property, the Borrower shall promptly notify the Administrative
Agent thereof and, within 30 days thereof, prepay the Loans (and/or
provide cover for LC Exposure) and/or the Commitments shall be
reduced as provided in the first paragraph of this clause (i) in an
amount equal to that portion of the Net Available Proceeds so
determined not to be used for such repair or replacement (but in
amounts not less than $1,000,000 and in $1,000,000 increments); and
(y) All Net Available Proceeds of Casualty Events in excess of
$50,000,000 in the aggregate shall, unless the Required Lenders
shall approve the use thereof for the purpose of repairing or
replacing the property affected by the relevant Casualty Event,
within 30 days after the Borrower's receipt of such Net
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Available Proceeds, prepay the Loans (and/or provide cover for LC
Exposure) and/or the Commitments shall be reduced as provided in the
first paragraph of this clause (i) in an amount equal to such excess
(but in amounts not less than $1,000,000 and in $1,000,000
increments).
Nothing in this paragraph shall be deemed to limit any obligation of
the Borrower or any of its Subsidiaries pursuant to any of the Security
Documents to remit to a collateral or similar account maintained by the
Administrative Agent pursuant to any of the Security Documents the proceeds of
insurance, condemnation award or other compensation received in respect of any
Casualty Event.
(ii) Debt Incurrence. Upon any Debt Incurrence after the Effective
Date, the Borrower shall prepay the Loans (and/or provide cover for LC
Exposure as specified in Section 2.05(k)), and/or the Revolving Credit
Commitments shall be subject to automatic reduction, in an aggregate
amount equal to 100% of the Net Available Proceeds thereof, such
prepayment and/or reduction to be effected in each case in the manner and
to the extent specified in clause (vii) of this paragraph.
(iii) Equity Issuance. Upon any Equity Issuance after the Effective
Date, the Borrower shall prepay the Loans (and/or provide cover for LC
Exposure as specified in Section 2.05(k)), and/or the Commitments shall be
subject to automatic reduction, in an aggregate amount equal to 100% of
the Net Available Proceeds thereof, such prepayment and/or reduction to be
effected in each case in the manner and to the extent specified in clause
(vii) of this paragraph.
(iv) Excess Cash Flow. Not later than the date 90 days after the end
of each fiscal year of the Borrower ending after the date hereof, the
Borrower shall prepay the Loans (and/or provide cover for LC Exposure as
specified in Section 2.05(k)), and/or the Revolving Credit Commitments
shall be subject to automatic reduction, in an aggregate amount equal to
(A) 75% of Excess Cash Flow for such fiscal year minus (B) the aggregate
amount of optional prepayments of Term Loans (if any) made during such
fiscal year pursuant to paragraph (a) of this Section and, after the
payment in full of the Term Loans, the aggregate amount of voluntary
reductions of the Revolving Credit Commitments made during such fiscal
year pursuant to Section 2.08(b), such prepayment and/or reduction to be
effected in each case in the manner and to the extent specified in clause
(vii) of this paragraph; provided that no such prepayment under this
clause (iv) shall be required with respect to any such fiscal year if the
Leverage Ratio determined as of the last day of such fiscal year is less
than 3.0:1.0 (as set forth in the certificate with respect to such fiscal
year delivered pursuant to Section 6.01(c)).
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(v) Sale of Assets. Without limiting the obligation of the Borrower
to obtain the consent of the Required Lenders pursuant to Section 7.03(b)
to any Disposition not otherwise permitted hereunder, in the event that
the Net Available Proceeds of any Disposition (herein, the "Current
Disposition"), and of all prior Dispositions as to which a prepayment has
not yet been made under this paragraph, shall exceed $5,000,000 in the
aggregate (and thereafter in increments of $1,000,000) then, no later than
five Business Days prior to the occurrence of the Current Disposition, the
Borrower will deliver to the Lenders a statement, certified by a Financial
Officer of the Borrower, in form and detail satisfactory to the
Administrative Agent, of the amount of the Net Available Proceeds of the
Current Disposition and of all such prior Dispositions and will prepay the
Loans (and/or provide cover for LC Exposure as specified in Section
2.05(k)), and/or the Revolving Credit Commitments shall be subject to
automatic reduction, in an aggregate amount equal to 100% of the Net
Available Proceeds of the Current Disposition and such prior Dispositions
in excess of either $5,000,000 in the aggregate for any fiscal year or
$10,000,000 in the aggregate from the Effective Date, such prepayment
and/or reduction to be effected in each case in the manner and to the
extent specified in clause (vii) of this paragraph.
(vi) Consummation of Bond Tender Offer. Upon the earlier of (A) the
Bond Tender Offer Closing Date (but only if the aggregate amount of the
Term Loans not applied to consummate the Bond Tender Offer shall exceed
$15,000,000) or (B) the date 40 days after the Effective Date (but only if
the Bond Tender Offer Closing Date shall not have occurred by such date),
the Borrower will prepay the Term Loans in an aggregate amount equal to
100% of (i) the amount (if any) then held in the Bond Tender Offer
Collateral Account or (ii) if the Bond Tender Offer Closing Date shall
occur on the Effective Date, that portion of the proceeds (if any) of the
Term Loans that are not applied by the Borrower to consummate the Bond
Tender Offer but only if such unapplied amount exceeds $15,000,000,
ratably among the Classes of Term Loans and ratably over the remaining
scheduled installments thereof and the aggregate amount of such
prepayments may not be reborrowed.
(vii) Application. Prepayments and/or reductions of Commitments
pursuant to this paragraph (except with respect to prepayments made
pursuant to clause (vi) of this paragraph) shall be applied as follows:
first, ratably among the Classes of Term Loans in accordance
with the respective sums at such time of the aggregate outstanding
principal amount of Term Loans of such Class (if any), to prepay the
Term Loans of such Class (and, with respect to each Class of Term
Loans, ratably over the remaining scheduled installments thereof),
and
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second, after the payment in full of the Term Loans and the
termination of the Term Loan Commitments, to reduce the aggregate
amount of the Revolving Credit Commitments (and to the extent that,
after giving effect to such reduction, the total Revolving Credit
Exposures would exceed the Revolving Credit Commitments, the
Borrower shall, first, prepay ratably Swingline Loans and Foreign
Currency Credits, second, prepay Revolving Credit Loans and third,
provide cover for LC Exposure as specified in Section 2.05(k) in an
aggregate amount equal to such excess).
(c) Rights of Term Loan B Lenders. Notwithstanding anything to the
contrary in this Section, in connection with any optional or mandatory
prepayment under this Section at any time when the Term Loan A is outstanding,
any Term Loan B Lender may elect, by notice to the Administrative Agent and the
Borrower by telephone (confirmed by telecopy) at least one Business Day prior to
the prepayment date, to decline all or any portion of any such prepayment of its
B Term Loan, in which case the aggregate amount of the prepayment that would
have been applied to prepay such Lender's B Term Loan but that is so declined
shall be applied to prepay ratably over the remaining scheduled installments of
the Term Loan A (and, in that connection, to enable the election by any Term
Loan B Lender under this paragraph, the Borrower agrees to provide the
Administrative Agent (which shall promptly notify each Lender) at least five
Business Days' prior written notice of any prepayment under this Section to be
made at a time when any B Term Loan is outstanding).
(d) Notices, Etc. The Borrower shall notify the Administrative Agent
(and, in the case of prepayment of a Swingline Loan, the Swingline Lender) by
telephone (confirmed by telecopy) of any optional prepayment hereunder (i) in
the case of prepayment of a Eurodollar Borrowing, not later than 11:00 a.m., New
York City time, three Business Days before the date of prepayment, (ii) in the
case of prepayment of a Syndicated ABR Borrowing, not later than 11:00 a.m., New
York City time, one Business Day before the date of prepayment or (iii) in the
case of prepayment of a Swingline Loan, not later than 12:00 noon, New York City
time, on the date of prepayment. Each such notice shall be irrevocable and shall
specify the prepayment date, the principal amount of each Borrowing or portion
thereof to be prepaid and, in the case of a mandatory prepayment, a reasonably
detailed calculation of the amount of such prepayment; provided that, if a
notice of prepayment is given in connection with a conditional notice of
termination of the Revolving Credit Commitments as contemplated by Section 2.08,
then such notice of prepayment may be revoked if such notice of termination is
revoked in accordance with Section 2.08. Promptly following receipt of any such
notice relating to a Syndicated Borrowing, the Administrative Agent shall advise
the relevant Lenders of the contents thereof. Each partial prepayment of any
Borrowing shall be in an amount that would be permitted in the case of a
Borrowing of the same Type as provided in Section 2.02, except as necessary to
apply fully the
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required amount of a mandatory prepayment. Each prepayment of a Syndicated
Borrowing shall be applied ratably to the Loans included in the prepaid
Borrowing. Prepayments shall be accompanied by accrued interest to the extent
required by Section 2.12 and shall be made in the manner specified in Section
2.09(c). The notice requirement applicable to the prepayment of Foreign Currency
Credits shall be as agreed upon between the Foreign Currency Lender and the
relevant Subsidiary Borrower.
SECTION 2.11. Fees.
(a) Commitment Fee. The Borrower agrees to pay to the Administrative
Agent for account of each Revolving Credit Lender a commitment fee, which shall
accrue at a rate per annum equal to 0.50% on the average daily unused amount of
the Revolving Credit Commitment of such Lender during the period from and
including the Effective Date hereof to but excluding the earlier of the date
such Revolving Credit Commitment terminates and the Revolving Credit Commitment
Termination Date. Accrued commitment fees shall be payable in arrears on each
Quarterly Date and on the earlier of the date the Revolving Credit Commitment
terminates and the Revolving Credit Commitment Termination Date, commencing on
the first such date to occur after the date hereof. All commitment fees shall be
computed on the basis of a year of 360 days and shall be payable for the actual
number of days elapsed (including the first day but excluding the last day). For
purposes of computing commitment fees with respect to the Revolving Credit
Commitments, the Revolving Credit Commitment of a Lender shall be deemed to be
used to the extent of the outstanding Revolving Credit Loans and LC Exposure of
such Lender (and the Swingline Exposure and Foreign Currency Exposure of such
Lender shall be disregarded for such purpose).
(b) Letter of Credit Fees. The Borrower agrees to pay (i) to the
Administrative Agent for account of each Revolving Credit Lender a participation
fee with respect to its participations in Letters of Credit, which shall accrue
at a rate per annum equal to the Applicable Margin applicable to interest on
Eurodollar Revolving Credit Loans on the average daily amount of such Lender's
LC Exposure (excluding any portion thereof attributable to unreimbursed LC
Disbursements) during the period from and including the Effective Date to but
excluding the later of the date on which such Lender's Revolving Credit
Commitment terminates and the date on which such Lender ceases to have any LC
Exposure, and (ii) to each Issuing Lender a fronting fee in respect of each
Letter of Credit issued by it, which shall accrue at the rate per annum, as
mutually agreed between the Borrower and such Issuing Lender, on the average
daily amount of the aggregate undrawn amount of such Letter of Credit plus the
aggregate amount of all LC Disbursements in respect thereof that have not yet
been reimbursed by or on behalf of the Borrower during the period from and
including the Effective Date to but excluding the later of the date of
termination of the Revolving Credit Commitments and the date on which there
ceases to be any exposure with respect to such Letter of Credit, as well as such
Issuing Lender's
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standard fees with respect to the issuance, amendment, renewal or extension of
any Letter of Credit or processing of drawings thereunder. Participation fees
and fronting fees accrued through and including each Quarterly Date shall be
payable in arrears on the third Business Day following such Quarterly Date,
commencing on the first such date to occur after the Effective Date; provided
that all such fees shall be payable on the date on which the Revolving Credit
Commitments terminate and any such fees accruing after the date on which the
Revolving Credit Commitments terminate shall be payable on demand. Any other
fees payable to any Issuing Lender pursuant to this paragraph shall be payable
within 10 days after demand. All participation fees and fronting fees shall be
computed on the basis of a year of 360 days and shall be payable for the actual
number of days elapsed (including the first day but excluding the last day).
(c) Administrative Agent Fees. The Borrower agrees to pay to the
Administrative Agent, for its own account, fees payable in the amounts and at
the times separately agreed upon between the Borrower and the Administrative
Agent.
(d) Payment of Fees. Other than under paragraph (e) below, all fees
payable hereunder shall be paid on the dates due, in immediately available
funds, to the Administrative Agent (or to any Issuing Lender, in the case of
fees payable to it) for distribution, in the case of commitment fees and
participation fees, to the Lenders entitled thereto. Fees paid shall not be
refundable under any circumstances.
(e) Foreign Currency Credit Fees. The relevant Subsidiary Borrower
agrees to pay directly to the Foreign Currency Lender for its account such fees
in respect of the Foreign Currency Credits in such currency and on such date(s)
as may be agreed upon between such Subsidiary Borrower and the Foreign Currency
Lender.
SECTION 2.12. Interest.
(a) ABR Loans. The Loans constituting each ABR Borrowing (including
each Swingline Loan) shall bear interest at a rate per annum equal to the
Alternate Base Rate plus the Applicable Margin.
(b) Eurodollar Loans. The Loans constituting each Eurodollar
Borrowing shall bear interest at a rate per annum equal to the Adjusted LIBO
Rate for the Interest Period for such Borrowing plus the Applicable Margin.
(c) Default Interest. Notwithstanding the foregoing, upon and during
the continuation of any Event of Default, the aggregate principal amount of all
Loans shall bear interest, after as well as before judgment, at a rate per annum
equal to 2% plus the rate otherwise
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applicable to the respective Loans. In addition (but without duplication of the
amounts payable under the immediately preceding sentence), if any principal of
or interest on any Loan or any fee or other amount payable by the Borrower
hereunder is not paid when due, whether at stated maturity, upon acceleration,
by mandatory prepayment or otherwise, such overdue amount shall bear interest,
after as well as before judgment, at a rate per annum equal to (i) in the case
of overdue principal of any Loan, 2% plus the rate otherwise applicable to such
Loan as provided above or (ii) in the case of any other amount, 2% plus the rate
applicable to ABR Loans as provided in paragraph (a) of this Section.
(d) Payment of Interest. Accrued interest on each Loan shall be
payable in arrears on each Interest Payment Date for such Loan and, in the case
of Revolving Credit Loans, upon termination of the Revolving Credit Commitments;
provided that (i) interest accrued pursuant to paragraph (c) of this Section
shall be payable on demand, (ii) in the event of any repayment or prepayment of
any Loan (other than a prepayment of a Revolving Credit ABR Loan prior to the
Revolving Credit Commitment Termination Date), accrued interest on the principal
amount repaid or prepaid shall be payable on the date of such repayment or
prepayment and (iii) in the event of any conversion of any Eurodollar Borrowing
prior to the end of the Interest Period therefor, accrued interest on such
Borrowing shall be payable on the effective date of such conversion.
(e) Computation. All interest hereunder shall be computed on the
basis of a year of 360 days, except that interest computed by reference to the
Alternate Base Rate at times when the Alternate Base Rate is based on the Prime
Rate shall be computed on the basis of a year of 365 days (or 366 days in a leap
year), and in each case shall be payable for the actual number of days elapsed
(including the first day but excluding the last day). The applicable Alternate
Base Rate or Adjusted LIBO Rate shall be determined by the Administrative Agent,
and such determination shall be conclusive absent manifest error.
(f) Foreign Currency Credits. Each Foreign Currency Credit shall
bear interest at a rate per annum as agreed upon between the Foreign Currency
Lender and the relevant Subsidiary Borrower at or prior to the time of the
making or issuance, as the case may be, of such Foreign Currency Credit and
shall be computed on the basis as so agreed. Accrued interest on each Foreign
Currency Credit shall be payable on the date(s) as agreed upon between the
Foreign Currency Lender and the relevant Subsidiary Borrower (which date(s)
shall not be later than the Revolving Credit Commitment Termination Date).
SECTION 2.13. Alternate Rate of Interest. If prior to the
commencement of the Interest Period for a Eurodollar Borrowing:
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(a) the Administrative Agent determines (which determination shall
be conclusive absent manifest error) that adequate and reasonable means do
not exist for ascertaining the Adjusted LIBO Rate for such Interest
Period; or
(b) if such Borrowing is of a particular Class of Loans, the
Administrative Agent is advised by the Required Lenders of such Class that
the Adjusted LIBO Rate for such Interest Period will not adequately and
fairly reflect the cost to such Lenders of making or maintaining their
Loans included in such Borrowing for such Interest Period;
then the Administrative Agent shall give notice thereof to the Borrower and the
Lenders by telephone or telecopy as promptly as practicable thereafter and,
until the Administrative Agent notifies the Borrower and the Lenders that the
circumstances giving rise to such notice no longer exist, (i) any Interest
Election Request that requests the conversion of any Syndicated Borrowing to, or
continuation of any Syndicated Borrowing as, a Eurodollar Borrowing shall be
ineffective and (ii) if any Borrowing Request requests a Eurodollar Borrowing,
such Borrowing shall be made as a Syndicated ABR Borrowing.
SECTION 2.14. Increased Costs.
(a) Increased Costs Generally. If any Change in Law shall:
(i) impose, modify or deem applicable any reserve, special deposit
or similar requirement against assets of, deposits with or for account of,
or credit extended by, any Lender (except any such reserve requirement
reflected in the Adjusted LIBO Rate) or any Issuing Lender; or
(ii) impose on any Lender or any Issuing Lender or the London
interbank market any other condition affecting this Agreement or
Eurodollar Loans made by such Lender or any Letter of Credit or
participation therein;
and the result of any of the foregoing shall be to increase the cost to such
Lenders of making or maintaining any Eurodollar Loan (or of maintaining its
obligation to make any such Loan) or to increase the cost to such Lender or the
relevant Issuing Lender of participating in, issuing or maintaining any Letter
of Credit or to reduce the amount of any sum received or receivable by such
Lender or such Issuing Lender hereunder (whether of principal, interest or
otherwise), then the Borrower will pay to such Lender or such Issuing Lender, as
the case may be, such additional amount or amounts as will compensate such
Lender or such Issuing Lender, as the case may be, for such additional costs
incurred or reduction suffered.
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(b) Capital Requirements. If any Lender or any Issuing Lender
determines that any Change in Law regarding capital requirements has or would
have the effect of reducing the rate of return on such Lender's or such Issuing
Lender's capital or on the capital of such Lender's or such Issuing Lender's
holding company, if any, as a consequence of this Agreement or the Loans made
by, or participations in Letters of Credit held by, such Lender, or the Letters
of Credit issued by such Issuing Lender, to a level below that which such Lender
or such Issuing Lender or such Lender's or such Issuing Lender's holding company
could have achieved but for such Change in Law (taking into consideration such
Lender's or such Issuing Lender's policies and the policies of such Lender's or
such Issuing Lender's holding company with respect to capital adequacy), then
from time to time the Borrower will pay to such Lender or such Issuing Lender,
as the case may be, such additional amount or amounts as will compensate such
Lender or such Issuing Lender or such Lender's or such Issuing Lender's holding
company for any such reduction suffered.
(c) Certificates from Lenders. A certificate of a Lender or an
Issuing Lender setting forth the amount or amounts necessary to compensate such
Lender or such Issuing Lender or its holding company, as the case may be, as
specified in paragraph (a) or (b) of this Section shall be delivered to the
Borrower and shall be conclusive absent manifest error. The Borrower shall pay
such Lender or such Issuing Lender, as the case may be, the amount shown as due
on any such certificate within 30 days after receipt thereof.
(d) Delay in Requests. Failure or delay on the part of any Lender or
any Issuing Lender to demand compensation pursuant to this Section shall not
constitute a waiver of such Lender's or such Issuing Lender's right to demand
such compensation; provided that the Borrower shall not be required to
compensate a Lender or an Issuing Lender pursuant to this Section for any
increased costs or reductions incurred more than six months prior to the date
that such Lender or such Issuing Lender, as the case may be, notifies the
Borrower of the Change in Law giving rise to such increased costs or reductions
and of such Lender's or such Issuing Lender's intention to claim compensation
therefor; provided further that, if the Change in Law giving rise to such
increased costs or reductions is retroactive, then the six-month period referred
to above shall be extended to include the period of retroactive effect thereof.
SECTION 2.15. Break Funding Payments. In the event of (a) the
payment of any principal of any Eurodollar Loan other than on the last day of an
Interest Period therefor (including as a result of an Event of Default), (b) the
conversion of any Eurodollar Loan other than on the last day of an Interest
Period therefor, (c) the failure to borrow, convert, continue or prepay any
Syndicated Loan on the date specified in any notice delivered pursuant hereto
(regardless of whether such notice is permitted to be revocable under Section
2.10(d) and is revoked in accordance herewith), or (d) the assignment of any
Eurodollar Loan other than on the last day of an Interest Period therefor as a
result of a request by the Borrower pursuant to
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Section 2.18, then, in any such event, the Borrower shall compensate each Lender
for the loss, cost and expense attributable to such event. In the case of a
Eurodollar Loan, the loss to any Lender attributable to any such event shall be
deemed to include an amount determined by such Lender to be equal to the excess,
if any, of (i) the amount of interest that such Lender would pay for a deposit
equal to the principal amount of such Loan for the period from the date of such
payment, conversion, failure or assignment to the last day of the then current
Interest Period for such Loan (or, in the case of a failure to borrow, convert
or continue, the duration of the Interest Period that would have resulted from
such borrowing, conversion or continuation) if the interest rate payable on such
deposit were equal to the Adjusted LIBO Rate for such Interest Period, over (ii)
the amount of interest that such Lender would earn on such principal amount for
such period if such Lender were to invest such principal amount for such period
at the interest rate that would be bid by such Lender (or an affiliate of such
Lender) for Dollar deposits from other banks in the eurodollar market at the
commencement of such period. A certificate of any Lender setting forth any
amount or amounts that such Lender is entitled to receive pursuant to this
Section shall be delivered to the Borrower and shall be conclusive absent
manifest error. The Borrower shall pay such Lender the amount shown as due on
any such certificate within 30 days after receipt thereof.
SECTION 2.16. Taxes.
(a) Payments Free of Taxes. Any and all payments by or on account of
any obligation of the Borrower hereunder or under any other Credit Document
shall be made free and clear of and without deduction for any Indemnified Taxes
or Other Taxes; provided that if the Borrower shall be required to deduct any
Indemnified Taxes or Other Taxes from such payments, then (i) the sum payable
shall be increased as necessary so that after making all required deductions
(including deductions applicable to additional sums payable under this Section)
the Administrative Agent, Lender or Issuing Lender (as the case may be) receives
an amount equal to the sum it would have received had no such deductions been
made, (ii) the Borrower shall make such deductions and (iii) the Borrower shall
pay the full amount deducted to the relevant Governmental Authority in
accordance with applicable law.
(b) Payment of Other Taxes by the Borrower. In addition, the
Borrower shall pay any Other Taxes to the relevant Governmental Authority in
accordance with applicable law.
(c) Indemnification by the Borrower. The Borrower shall indemnify
the Administrative Agent, each Lender and each Issuing Lender, within 30 days
after written demand therefor, for the full amount of any Indemnified Taxes or
Other Taxes (including Indemnified Taxes or Other Taxes imposed or asserted on
or attributable to amounts payable under this Section) paid by the
Administrative Agent, such Lender or such Issuing Lender, as the case may be,
and any penalties, interest and reasonable expenses arising therefrom or with
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respect thereto, whether or not such Indemnified Taxes or Other Taxes were
correctly or legally imposed or asserted by the relevant Governmental Authority.
A certificate as to the amount of such payment or liability delivered to the
Borrower by a Lender or an Issuing Lender, or by the Administrative Agent on its
own behalf or on behalf of a Lender or an Issuing Lender, shall be conclusive
absent manifest error.
(d) Evidence of Payments. As soon as practicable after any payment
of Indemnified Taxes or Other Taxes by the Borrower to a Governmental Authority,
the Borrower shall deliver to the Administrative Agent the original or a
certified copy of a receipt issued by such Governmental Authority evidencing
such payment, a copy of the return reporting such payment or other evidence of
such payment reasonably satisfactory to the Administrative Agent.
(e) Foreign Lenders. Any Foreign Lender that is entitled to an
exemption from or reduction of withholding tax under the law of the jurisdiction
in which the Borrower is located, or any treaty to which such jurisdiction is a
party, with respect to payments under this Agreement shall deliver to the
Borrower (with a copy to the Administrative Agent), at the time or times
prescribed by applicable law or reasonably requested by the Borrower, such
properly completed and executed documentation prescribed by applicable law as
will permit such payments to be made without withholding or at a reduced rate.
SECTION 2.17. Payments Generally; Pro Rata Treatment; Sharing of
Set-offs.
(a) Payments by the Obligors. Each Obligor shall make each payment
required to be made by it hereunder (whether of principal, interest, fees or
reimbursement of LC Disbursements, or under Section 2.14, 2.15 or 2.16, or
otherwise) or under any other Credit Document (except to the extent otherwise
provided therein) prior to 12:00 noon, New York City time, on the date when due,
in immediately available funds, without set-off, counterclaim or other
deduction; provided that if a new Loan is to be made by any Lender on a date the
Borrower is to repay any principal of an outstanding Loan of such Lender, such
Lender shall apply the proceeds of such new Loan to the payment of the principal
to be repaid and only an amount equal to the difference between the principal to
be borrowed and the principal to be repaid shall be made available by such
Lender to the Administrative Agent as provided in Section 2.06 or paid by the
Borrower to the Administrative Agent pursuant to this paragraph, as the case may
be. Any amounts received after such time on any date may, in the discretion of
the Administrative Agent, be deemed to have been received on the next succeeding
Business Day for purposes of calculating interest thereon. All such payments
shall be made to the Administrative Agent at its offices at 270 Park Avenue, New
York, New York, except as otherwise expressly provided in the relevant Credit
Document, and except payments to be made directly to the relevant Issuing
Lender, the Swingline Lender or the Foreign Currency Lender as expressly
provided herein and except that payments pursuant to Sections 2.14, 2.15, 2.16
and 10.03 shall be made directly to
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the Persons entitled thereto. The Administrative Agent shall distribute any such
payments received by it for account of any other Person to the appropriate
recipient promptly following receipt thereof. If any payment hereunder shall be
due on a day that is not a Business Day, the date for payment shall be extended
to the next succeeding Business Day and, in the case of any payment accruing
interest, interest thereon shall be payable for the period of such extension.
All payments hereunder or under any other Credit Document (except to the extent
otherwise provided herein or therein) shall be made in Dollars.
(b) Application of Insufficient Payments. If at any time
insufficient funds are received by and available to the Administrative Agent to
pay fully all amounts of principal, unreimbursed LC Disbursements, interest and
fees then due hereunder, such funds shall be applied (i) first, to pay interest
and fees then due hereunder, ratably among the parties entitled thereto in
accordance with the amounts of interest and fees then due to such parties, and
(ii) second, to pay principal and unreimbursed LC Disbursements then due
hereunder, ratably among the parties entitled thereto in accordance with the
amounts of principal and unreimbursed LC Disbursements then due to such parties.
(c) Pro Rata Treatment. Except to the extent otherwise provided
herein: (i) each Syndicated Borrowing of a particular Class shall be made from
the relevant Lenders, each payment of commitment fee under Section 2.11 in
respect of Commitments of a particular Class shall be made for account of the
relevant Lenders, and each termination or reduction of the amount of the
Commitments of a particular Class under Section 2.08 shall be applied to the
respective Commitments of such Class of the relevant Lenders, pro rata according
to the amounts of their respective Commitments of such Class; (ii) each
Syndicated Borrowing of any Class shall be allocated pro rata among the relevant
Lenders according to the amounts of their respective Commitments of such Class
(in the case of the making of Syndicated Loans) or their respective Loans of
such Class (in the case of conversions and continuations of Loans); (iii) each
payment or prepayment of principal of Revolving Credit Loans, the Term Loan A
and the Term Loan B by the Borrower shall be made for account of the relevant
Lenders pro rata in accordance with the respective unpaid principal amounts of
the Syndicated Loans of such Class held by them; and (iv) each payment of
interest on Revolving Credit Loans, the Term Loan A and the Term Loan B by the
Borrower shall be made for account of the relevant Lenders pro rata in
accordance with the amounts of interest on such Loans then due and payable to
the respective Lenders.
(d) Sharing of Payments by Lenders. If any Lender shall, by
exercising any right of set-off or counterclaim or otherwise, obtain payment in
respect of any principal of or interest on any of its Syndicated Loans or
participations in LC Disbursements, Swingline Loans or Foreign Currency Credits
resulting in such Lender receiving payment of a greater proportion of the
aggregate amount of its Syndicated Loans and participations in LC Disbursements,
Swingline
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Loans and Foreign Currency Credits and accrued interest thereon then due than
the proportion received by any other Lender, then the Lender receiving such
greater proportion shall purchase (for cash at face value) participations in the
Syndicated Loans and participations in LC Disbursements, Swingline Loans and
Foreign Currency Credits of other Lenders to the extent necessary so that the
benefit of all such payments shall be shared by the Lenders ratably in
accordance with the aggregate amount of principal of and accrued interest on
their respective Syndicated Loans and participations in LC Disbursements,
Swingline Loans and Foreign Currency Credits; provided that (i) if any such
participations are purchased and all or any portion of the payment giving rise
thereto is recovered, such participations shall be rescinded and the purchase
price restored to the extent of such recovery, without interest, and (ii) the
provisions of this paragraph shall not be construed to apply to any payment made
by any Obligor pursuant to and in accordance with the express terms of this
Agreement or any payment obtained by a Lender as consideration for the
assignment of or sale of a participation in any of its Loans or participations
in LC Disbursements to any assignee or participant, other than to the Borrower
or any Subsidiary or Affiliate thereof (as to which the provisions of this
paragraph shall apply). Each Obligor consents to the foregoing and agrees, to
the extent it may effectively do so under applicable law, that any Lender
acquiring a participation pursuant to the foregoing arrangements may exercise
against such Obligor rights of set-off and counterclaim with respect to such
participation as fully as if such Lender were a direct creditor of such Obligor
in the amount of such participation. The Dollar Equivalent of the principal or
face amount of each Foreign Currency Credit shall be determined by the
Administrative Agent in the case of receipt by any Lender of any payment or
other recovery which may be subject to this paragraph (d).
(e) Presumptions of Payment. Unless the Administrative Agent shall
have received notice from the Borrower prior to the date on which any payment is
due to the Administrative Agent for account of the Lenders or any Issuing Lender
hereunder that the Borrower will not make such payment, the Administrative Agent
may assume that the Borrower has made such payment on such date in accordance
herewith and may, in reliance upon such assumption, distribute to the Lenders or
such Issuing Lender, as the case may be, the amount due. In such event, if the
Borrower has not in fact made such payment, then each of the Lenders or such
Issuing Lender, as the case may be, severally agrees to repay to the
Administrative Agent forthwith on demand the amount so distributed to such
Lender or such Issuing Lender with interest thereon, for each day from and
including the date such amount is distributed to it to but excluding the date of
payment to the Administrative Agent, at the Federal Funds Effective Rate.
(f) Certain Deductions by the Administrative Agent. If any Lender
shall fail to make any payment required to be made by it pursuant to Section
2.04(a)(iii), 2.04(b)(iii), 2.05(e) or (f), 2.06(b) or 2.17(e), then the
Administrative Agent may, in its discretion (notwithstanding any contrary
provision hereof), apply any amounts thereafter received by the Administrative
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Agent for account of such Lender to satisfy such Lender's obligations under such
Sections until all such unsatisfied obligations are fully paid.
SECTION 2.18. Mitigation Obligations; Replacement of Lenders.
(a) Designation of a Different Lending Office. If any Lender
requests compensation under Section 2.14, or if the Borrower is required to pay
any additional amount to any Lender or any Governmental Authority for account of
any Lender pursuant to Section 2.16, then such Lender shall use reasonable
efforts to designate a different lending office for funding or booking its Loans
hereunder or to assign its rights and obligations hereunder to another of its
offices, branches or affiliates, if, in the judgment of such Lender, such
designation or assignment (i) would eliminate or reduce amounts payable pursuant
to Section 2.14 or 2.16, as the case may be, in the future and (ii) would not
subject such Lender to any unreimbursed cost or expense and would not otherwise
be disadvantageous to such Lender. The Borrower hereby agrees to pay all
reasonable costs and expenses incurred by any Lender in connection with any such
designation or assignment.
(b) Replacement of Lenders. If any Lender requests compensation
under Section 2.14, or if the Borrower is required to pay any additional amount
to any Lender or any Governmental Authority for account of any Lender pursuant
to Section 2.16, or if any Lender defaults in its obligation to fund Loans
hereunder, then the Borrower may, at its sole expense and effort, upon notice to
such Lender and the Administrative Agent, require such Lender to assign and
delegate, without recourse (in accordance with and subject to the restrictions
contained in Section 10.04), all its interests, rights and obligations under
this Agreement to an assignee that shall assume such obligations (which assignee
may be another Lender, if a Lender accepts such assignment); provided that (i)
the Borrower shall have received the prior written consent of the Administrative
Agent (and, if a Revolving Credit Commitment is being assigned, the Issuing
Lenders, the Swingline Lender and the Foreign Currency Lender), which consent
shall not unreasonably be withheld, (ii) such Lender shall have received payment
of an amount equal to the outstanding principal of its Loans and participations
in LC Disbursements, Swingline Loans and Foreign Currency Credits, accrued
interest thereon, accrued fees and all other amounts payable to it hereunder,
from the assignee (to the extent of such outstanding principal and accrued
interest and fees) or the Borrower (in the case of all other amounts) and (iii)
in the case of any such assignment resulting from a claim for compensation under
Section 2.14 or payments required to be made pursuant to Section 2.16, such
assignment will result in a reduction in such compensation or payments. A Lender
shall not be required to make any such assignment and delegation if, prior
thereto, as a result of a waiver by such Lender or otherwise, the circumstances
entitling the Borrower to require such assignment and delegation cease to apply.
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ARTICLE III
GUARANTEE
SECTION 3.01. The Guarantee
(a) The Borrower hereby guarantees to each Lender and the
Administrative Agent and their respective successors and assigns, in each case
as primary obligor and not merely as surety, the prompt payment in full when due
(whether at stated maturity, by acceleration or otherwise) of the principal of
and interest on the Foreign Currency Credits made by the Foreign Currency Lender
to the Subsidiary Borrowers and all other amounts from time to time owing to the
Lenders or the Administrative Agent by the Subsidiary Borrowers under this
Agreement, in each case strictly in accordance with the terms thereof (such
obligations being herein collectively called the "Foreign Currency Guaranteed
Obligations"). The Borrower hereby further agrees that if the Subsidiary
Borrowers shall fail to pay in full when due (whether at stated maturity, by
acceleration or otherwise) any of the Foreign Currency Guaranteed Obligations,
the Borrower will promptly pay the same, without any demand or notice
whatsoever, and that in the case of any extension of time of payment or renewal
of any of the Foreign Currency Guaranteed Obligations, the same will be promptly
paid in full when due (whether at extended maturity, by acceleration or
otherwise) in accordance with the terms of such extension or renewal.
(b) The Subsidiary Guarantors hereby jointly and severally guarantee
to each Lender and the Administrative Agent and their respective successors and
assigns the prompt payment in full when due (whether at stated maturity, by
acceleration or otherwise) of the principal of and interest on the Loans made by
the Lenders to the Borrower and all other amounts from time to time owing to the
Lenders or the Administrative Agent by the Borrower under this Agreement and by
any Obligor under any of the other Credit Documents, and all obligations of the
Borrower or any of its Subsidiaries to any Lender (or any affiliate of any
Lender) in respect of any Hedging Agreement, in each case strictly in accordance
with the terms thereof (such obligations being herein collectively called the
"Guaranteed Obligations"). The Subsidiary Guarantors hereby further jointly and
severally agree that if the Borrower shall fail to pay in full when due (whether
at stated maturity, by acceleration or otherwise) any of the Guaranteed
Obligations, the Subsidiary Guarantors will promptly pay the same, without any
demand or notice whatsoever, and that in the case of any extension of time of
payment or renewal of any of the Guaranteed Obligations, the same will be
promptly paid in full when due (whether at extended maturity, by acceleration or
otherwise) in accordance with the terms of such extension or renewal.
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SECTION 3.02. Obligations Unconditional. The obligations of the
Guarantors under Section 3.01 are absolute and unconditional, joint and several,
irrespective of the value, genuineness, validity, regularity or enforceability
of the obligations of the Borrower under this Agreement or any other agreement
or instrument referred to herein, or any substitution, release or exchange of
any other guarantee of or security for any of the Foreign Currency Guaranteed
Obligations or the Guaranteed Obligations, and, to the fullest extent permitted
by applicable law, irrespective of any other circumstance whatsoever that might
otherwise constitute a legal or equitable discharge or defense of a surety or
guarantor, it being the intent of this Section that the obligations of the
Guarantors hereunder shall be absolute and unconditional, joint and several,
under any and all circumstances. Without limiting the generality of the
foregoing, it is agreed that the occurrence of any one or more of the following
shall not alter or impair the liability of the Guarantors hereunder, which shall
remain absolute and unconditional as described above:
(i) at any time or from time to time, without notice to the
Guarantors, the time for any performance of or compliance with any of the
Foreign Currency Guaranteed Obligations or the Guaranteed Obligations
shall be extended, or such performance or compliance shall be waived;
(ii) any of the acts mentioned in any of the provisions of this
Agreement or any other agreement or instrument referred to herein shall be
done or omitted;
(iii) the maturity of any of the Foreign Currency Guaranteed
Obligations or the Guaranteed Obligations shall be accelerated, or any of
the Foreign Currency Guaranteed Obligations or the Guaranteed Obligations
shall be modified, supplemented or amended in any respect, or any right
under this Agreement or any other agreement or instrument referred to
herein shall be waived or any other guarantee of any of the Foreign
Currency Guaranteed Obligations or the Guaranteed Obligations or any
security therefor shall be released or exchanged in whole or in part or
otherwise dealt with; or
(iv) any lien or security interest granted to, or in favor of, the
Administrative Agent or any Lender or Lenders as security for any of the
Foreign Currency Guaranteed Obligations or the Guaranteed Obligations
shall fail to be perfected.
The Guarantors hereby expressly waive diligence, presentment, demand of payment,
protest and all notices whatsoever, and any requirement that the Administrative
Agent or any Lender exhaust any right, power or remedy or proceed against the
Borrower under this Agreement or any other agreement or instrument referred to
herein, or against any other Person under any other guarantee of, or security
for, any of the Foreign Currency Guaranteed Obligations or the Guaranteed
Obligations.
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SECTION 3.03. Reinstatement. The obligations of the Guarantors under
this Article shall be automatically reinstated if and to the extent that for any
reason any payment by or on behalf of an Obligor in respect of the Foreign
Currency Guaranteed Obligations or the Guaranteed Obligations is rescinded or
must be otherwise restored by any holder of any of the Foreign Currency
Guaranteed Obligations or the Guaranteed Obligations, whether as a result of any
proceedings in bankruptcy or reorganization or otherwise, and the Guarantors
jointly and severally agree that they will indemnify the Administrative Agent
and each Lender on demand for all reasonable costs and expenses (including
reasonable fees of counsel) incurred by the Administrative Agent or such Lender
in connection with such rescission or restoration, including any such costs and
expenses incurred in defending against any claim alleging that such payment
constituted a preference, fraudulent transfer or similar payment under any
bankruptcy, insolvency or similar law, but excluding any such costs and expenses
determined by a court of competent jurisdiction by final and nonappealable
judgment to have resulted from the gross negligence or willful misconduct of the
Administrative Agent or such Lender, as the case may be.
SECTION 3.04. Subrogation. The Guarantors hereby jointly and
severally agree that until the payment and satisfaction in full of all Foreign
Currency Guaranteed Obligations and Guaranteed Obligations and the expiration
and termination of the Commitments of the Lenders under this Agreement they
shall not exercise any right or remedy arising by reason of any performance by
them of their guarantee in Section 3.01, whether by subrogation or otherwise,
against any Obligor or any other guarantor of any of the Foreign Currency
Guaranteed Obligations or the Guaranteed Obligations or any security for any of
the Foreign Currency Guaranteed Obligations or the Guaranteed Obligations.
SECTION 3.05. Remedies. The Guarantors jointly and severally agree
that, as between the Guarantors and the Lenders, the obligations of the Obligors
under this Agreement may be declared to be forthwith due and payable as provided
in Article VIII (and shall be deemed to have become automatically due and
payable in the circumstances provided in Article VIII) for purposes of Section
3.01 notwithstanding any stay, injunction or other prohibition preventing such
declaration (or such obligations from becoming automatically due and payable) as
against any Obligor and that, in the event of such declaration (or such
obligations being deemed to have become automatically due and payable), such
obligations (whether or not due and payable by such Obligor) shall forthwith
become due and payable by the Guarantors for purposes of Section 3.01.
SECTION 3.06. Instrument for the Payment of Money. Each Guarantor
hereby acknowledges that the guarantee in this Article constitutes an instrument
for the payment of money, and consents and agrees that any Lender or the
Administrative Agent, at its sole option,
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in the event of a dispute by such Guarantor in the payment of any moneys due
hereunder, shall have the right to bring motion-action under New York CPLR
Section 3213.
SECTION 3.07. Continuing Guarantee. The guarantee in this Article is
a continuing guarantee, and shall apply to all Foreign Currency Guaranteed
Obligations and Guaranteed Obligations whenever arising.
SECTION 3.08. Rights of Contribution. The Subsidiary Guarantors
hereby agree, as between themselves, that if any Subsidiary Guarantor shall
become an Excess Funding Guarantor (as defined below) by reason of the payment
by such Subsidiary Guarantor of any Guaranteed Obligations (including without
duplication, for purposes of this Section only, any Guaranteed Obligations as
defined in the MVE Guarantee Agreement), each other Subsidiary Guarantor shall,
on demand of such Excess Funding Guarantor (but subject to the next sentence),
pay to such Excess Funding Guarantor an amount equal to such Subsidiary
Guarantor's Pro Rata Share (as defined below and determined, for this purpose,
without reference to the properties, debts and liabilities of such Excess
Funding Guarantor) of the Excess Payment (as defined below) in respect of such
Guaranteed Obligations. The payment obligation of a Subsidiary Guarantor to any
Excess Funding Guarantor under this Section shall be subordinate and subject in
right of payment to the prior payment in full of the obligations of such
Subsidiary Guarantor under the other provisions of this Article and such Excess
Funding Guarantor shall not exercise any right or remedy with respect to such
excess until payment and satisfaction in full of all of such obligations.
For purposes of this Section, (i) "Excess Funding Guarantor" means,
in respect of any Guaranteed Obligations, a Subsidiary Guarantor that has paid
an amount in excess of its Pro Rata Share of such Guaranteed Obligations, (ii)
"Excess Payment" means, in respect of any Guaranteed Obligations, the amount
paid by an Excess Funding Guarantor in excess of its Pro Rata Share of such
Foreign Currency Guaranteed Obligations or Guaranteed Obligations and (iii) "Pro
Rata Share" means, for any Subsidiary Guarantor, the ratio (expressed as a
percentage) of (x) the amount by which the aggregate present fair saleable value
of all properties of such Subsidiary Guarantor (excluding any shares of stock of
any other Subsidiary Guarantor) exceeds the amount of all the debts and
liabilities of such Subsidiary Guarantor (including contingent, subordinated,
unmatured and unliquidated liabilities, but excluding the obligations of such
Subsidiary Guarantor hereunder and any obligations of any other Subsidiary
Guarantor that have been Guaranteed by such Subsidiary Guarantor) to (y) the
amount by which the aggregate fair saleable value of all properties of all of
the Subsidiary Guarantors exceeds the amount of all the debts and liabilities
(including contingent, subordinated, unmatured and unliquidated liabilities, but
excluding the obligations of the Subsidiary Guarantors hereunder and under the
other Credit Documents) of all of the Subsidiary Guarantors, determined (A) with
respect to any Subsidiary Guarantor that is a party hereto on the Effective
Date, as of the Effective Date, and (B) with
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respect to any other Subsidiary Guarantor, as of the date such Subsidiary
Guarantor becomes a Subsidiary Guarantor hereunder.
SECTION 3.09. General Limitation on Guarantee Obligations. In any
action or proceeding involving any state corporate law, or any state or Federal
bankruptcy, insolvency, reorganization or other law affecting the rights of
creditors generally, if the obligations of any Subsidiary Guarantor under
Section 3.01(b) would otherwise, taking into account the provisions of Section
3.08, be held or determined to be void, invalid or unenforceable, or
subordinated to the claims of any other creditors, on account of the amount of
its liability under Section 3.01(b), then, notwithstanding any other provision
hereof to the contrary, the amount of such liability shall, without any further
action by such Subsidiary Guarantor, any Lender, the Administrative Agent or any
other Person, be automatically limited and reduced to the highest amount that is
valid and enforceable and not subordinated to the claims of other creditors as
determined in such action or proceeding.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
The Borrower represents and warrants to the Lenders that:
SECTION 4.01. Organization; Powers. Each of the Borrower and its
Subsidiaries is duly organized, validly existing and in good standing under the
laws of the jurisdiction of its organization, has all requisite power and
authority to carry on its business as now conducted and, except where the
failure to do so, individually or in the aggregate, could not reasonably be
expected to result in a Material Adverse Effect, is qualified to do business in,
and is in good standing in, every jurisdiction where such qualification is
required.
SECTION 4.02. Authorization; Enforceability. The Transactions are
within each Obligor's corporate powers and have been duly authorized by all
necessary corporate and, if required, by all necessary shareholder action. This
Agreement has been duly executed and delivered by each Obligor party hereto and
constitutes, and each of the other Basic Documents to which it is a party when
executed and delivered by such Obligor will constitute, a legal, valid and
binding obligation of such Obligor, enforceable against each Obligor in
accordance with its terms, except as such enforceability may be limited by (a)
bankruptcy, insolvency, reorganization, moratorium or similar laws of general
applicability affecting the enforcement of creditors' rights and (b) the
application of general principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity or at law).
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SECTION 4.03. Governmental Approvals; No Conflicts. The execution,
delivery and performance of the Credit Documents (a) do not require any consent
or approval of, registration or filing with, or any other action by, any
Governmental Authority, except for (i) such as have been obtained or made and
are in full force and effect and (ii) filings and recordings in respect of the
Liens created pursuant to the Security Documents, (b) will not violate any
applicable law or regulation or the charter, by-laws or other organizational
documents of the Borrower or any of its Subsidiaries or any order of any
Governmental Authority, (c) will not violate or result in a default under any
indenture, agreement or other instrument binding upon the Borrower or any of its
Subsidiaries or assets, or give rise to a right thereunder to require any
payment to be made by any such Person in excess of $5,000,000 in the aggregate,
and (d) except for the Liens created pursuant to the Security Documents, will
not result in the creation or imposition of any Lien on any asset of the
Borrower or any of its Subsidiaries.
SECTION 4.04. Financial Condition; No Material Adverse Change; Year
2000 Issues.
(a) Financial Condition of the Borrower. The Borrower has heretofore
furnished to the Lenders its audited consolidated balance sheet and statements
of income, stockholders' equity and cash flows as of and for each of the fiscal
years ended December 31, 1998 and December 31, 1997 reported on by Ernst & Young
LLP. Such financial statements present fairly, in all material respects, the
financial position and results of operations and cash flows of the Borrower and
its Subsidiaries as of such dates and for such periods in accordance with GAAP.
Neither the Borrower nor any of its Subsidiaries has, on the date hereof, any
material contingent liabilities, material liabilities for taxes, long-term
leases or unusual forward or long-term commitments, including any interest rate
or foreign currency swap or exchanged transactions, or any unrealized or
anticipated losses from any unfavorable commitments, which are not reflected in
such financial statements.
(b) Financial Condition of MVE Holdings. The Borrower has heretofore
furnished to the Lenders the consolidated balance sheet and statements of
income, stockholders' equity and cash flows of MVE Holdings and its Subsidiaries
as of and for each of the fiscal years ended December 31, 1998 and December 31,
1997. Such financial statements present fairly, in all material respects, the
financial position and results of operations and cash flows of MVE Holdings and
its Subsidiaries as of such dates and for such periods in accordance with GAAP.
Neither MVE Holdings nor any of its Subsidiaries has, on the date hereof, any
material contingent liabilities, material liabilities for taxes, long-term
leases or unusual forward or long-term commitments, including any interest rate
or foreign currency swap or exchanged transactions, or any unrealized or
anticipated losses from any unfavorable commitments, which are not reflected in
such financial statements.
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(c) Pro Forma Financial Statements. The Borrower has heretofore
furnished to the Lenders an unaudited pro forma consolidated balance sheet of
the Borrower and its Subsidiaries as at December 31, 1998 after giving effect to
the consummation of the Acquisition, the incurrence of the Indebtedness
hereunder and the use of the proceeds thereof and the consummation of the other
Transactions (including, without limitation, the Bond Tender Offer), which
presents fairly the consolidated pro forma financial condition of the Borrower
and its Subsidiaries, taken as a whole, and are based on assumptions that the
Borrower deems reasonable and appropriate in light of current circumstances.
(d) No Material Adverse Change. Since December 31, 1998, there has
been no material adverse change in the business, assets, operations, prospects
or condition, financial or otherwise, of the Borrower and its Subsidiaries,
taken as a whole (other than any such change resulting solely from the
consummation of the Acquisition as of the Effective Date).
(e) Year 2000 Issues. Any reprogramming required to permit the
proper functioning, in and following the year 2000, of (i) the Borrower's and
its Subsidiaries' computer systems and (ii) equipment containing embedded
microchips (including systems and equipment supplied by others or with which the
Borrower's and its Subsidiaries' systems interface) and the testing of all such
systems and equipment, as so reprogrammed, will be completed by June 30, 1999.
The cost to the Borrower and its Subsidiaries of such reprogramming and testing
and of the reasonably foreseeable consequences of year 2000 to the Borrower and
its Subsidiaries (including reprogramming errors and the failure of others'
systems or equipment) will not result in a Default or a Material Adverse Effect.
Except for such of the reprogramming referred to in the preceding sentence as
may be necessary, the computer and management information systems of the
Borrower and its Subsidiaries are and, with ordinary course upgrading and
maintenance, will continue for the term of this Agreement to be, sufficient to
permit the Borrower to conduct its business without a Material Adverse Effect.
SECTION 4.05. Properties.
(a) Property Generally. Each of the Borrower and its Subsidiaries
has good title to, or valid leasehold interests in, all its real and personal
property material to its business, subject only to Liens permitted by Section
7.02 and except for minor defects in title that do not interfere with its
ability to conduct its business as currently conducted or to utilize such
properties for their intended purposes.
(b) Intellectual Property. Each of the Borrower and its Subsidiaries
owns, or is licensed to use, all trademarks, tradenames, copyrights, patents and
other intellectual property material to its business, and the use thereof by the
Borrower and its Subsidiaries does not
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infringe upon the rights of any other Person, except for any such infringements
that, individually or in the aggregate, could not reasonably be expected to
result in a Material Adverse Effect.
SECTION 4.06. Litigation. There are no actions, suits or proceedings
by or before any arbitrator or Governmental Authority now pending against or, to
the knowledge of the Borrower, threatened against or affecting the Borrower or
any of its Subsidiaries (i) as to which there is a reasonable possibility of an
adverse determination and that, if adversely determined, could reasonably be
expected, individually or in the aggregate, to result in a Material Adverse
Effect (other than the matters disclosed in Schedule IV) or (ii) that involve
this Agreement or the Transactions. Since the date of this Agreement, there has
been no change in the status of the matters disclosed in Schedule IV that,
individually or in the aggregate, has resulted in, or materially increased the
likelihood of, a Material Adverse Effect.
SECTION 4.07. Environmental Matters. Each of the Borrower and its
Subsidiaries has obtained all environmental, health and safety permits,
licenses, registrations and other authorizations required under all
Environmental Laws to carry on its business as now being or as proposed to be
conducted, except to the extent failure to have any such permit, license,
registration or authorization would not (either individually or in the
aggregate) have a Material Adverse Effect. Each of such permits, licenses,
registrations and authorizations is in full force and effect and each of the
Borrower and its Subsidiaries is in compliance with the terms and conditions
thereof, and is also in compliance with all other limitations, restrictions,
conditions, standards, prohibitions, requirements, obligations, schedules and
timetables contained in any applicable Environmental Law or in any regulation,
code, plan, order, decree, judgment, injunction issued, entered, promulgated or
approved thereunder, except to the extent failure to comply therewith would not
(either individually or in the aggregate) have a Material Adverse Effect.
In addition, except as set forth in Schedule V:
(a) No Pending Environmental Matters. No written notice,
notification, demand, request for information, citation, summons or order
has been issued, no complaint has been filed, no penalty has been assessed
and no investigation or review is pending or, to the best knowledge of the
Borrower or any of its Subsidiaries, threatened by any governmental or
other entity with respect to any alleged failure by the Borrower or any of
its Subsidiaries to have any environmental, health or safety permit,
license, registration or other authorization required under any
Environmental Law in connection with the conduct of the business of the
Borrower or any of its Subsidiaries or with respect to any generation,
treatment, storage, recycling, transportation, discharge or disposal, or
any Release of any Hazardous Materials generated by the Borrower or any of
its Subsidiaries.
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(b) No Permits Required; Certain Specific Representations. Neither
the Borrower nor any of its Subsidiaries owns, operates or leases a
treatment, storage or disposal facility requiring a permit under the
Resource Conservation and Recovery Act of 1976, as amended, or under any
comparable state or local statute; and
(i) no polychlorinated biphenyls (PCB's) are or have been
present at or above regulated levels at any site or facility now or
previously owned, operated or leased by the Borrower or any of its
Subsidiaries;
(ii) no regulated asbestos or asbestos-containing materials is
or has been present at any site or facility now or previously owned,
operated or leased by the Borrower or any of its Subsidiaries;
(iii) there are no underground storage tanks or surface
impoundments for Hazardous Materials, active or abandoned, at any
site or facility now or, to the best knowledge of the Borrower or
any of its Subsidiaries, previously owned, operated or leased by the
Borrower or any of its Subsidiaries;
(iv) no Hazardous Materials have been Released at, on or under
any site or facility now or previously owned, operated or leased by
the Borrower or any of its Subsidiaries in a reportable quantity
established by statute, ordinance, rule, regulation or order; and
(v) no Hazardous Materials have been otherwise Released at, on
or under any site or facility now or previously owned, operated or
leased by the Borrower or any of its Subsidiaries that would (either
individually or in the aggregate) have a Material Adverse Effect.
(c) No Hazardous Material Transported to NPL Sites. Neither the
Borrower nor any of its Subsidiaries has transported or arranged for the
transportation of any Hazardous Material in amounts or quantities other
than those not reasonably likely to result in a Material Adverse Effect to
any location that is listed on the National Priorities List ("NPL") under
the Comprehensive Environmental Response, Compensation, and Liability Act
of 1980, as amended ("CERCLA"), listed for possible inclusion on the NPL
by the Environmental Protection Agency in the Comprehensive Environmental
Response and Liability Information System, as provided for by 40 C.F.R.
ss. 300.5 ("CERCLIS"), or on any similar state or local list or that is
the subject of Federal, state or local enforcement actions or other
investigations that may lead to Environmental Claims against the Borrower
or any of its Subsidiaries.
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(d) No Notifications or Listings. No oral or written notification of
a Release of a Hazardous Material has been filed by or on behalf of the
Borrower or any of its Subsidiaries and no site or facility now or
previously owned, operated or leased by the Borrower or any of its
Subsidiaries is listed or proposed for listing on the NPL, CERCLIS or any
similar state list of sites requiring investigation or clean-up.
(e) No Liens or Restrictions. No Liens have arisen under or pursuant
to any Environmental Laws on any site or facility owned, operated or
leased by the Borrower or any of its Subsidiaries, and no government
action has been taken or is in process that could subject any such site or
facility to such Liens and neither the Borrower nor any of its
Subsidiaries would be required to place any notice or restriction relating
to the presence of Hazardous Materials at any site or facility owned by it
in any deed to the real property on which such site or facility is
located.
(f) Full Disclosure. All environmental investigations, studies,
audits, tests, reviews or other analyses conducted by or that are in the
possession of the Borrower or any of its Subsidiaries in relation to
facts, circumstances or conditions at or affecting any site or facility
now or previously owned, operated or leased by the Borrower or any of its
Subsidiaries and that could result in a Material Adverse Effect have been
made available to the Lenders.
SECTION 4.08. Compliance with Laws and Agreements. Each of the
Borrower and its Subsidiaries is in compliance with all laws, regulations and
orders of any Governmental Authority applicable to it or its property and all
indentures, agreements and other instruments binding upon it or its property,
except where the failure to do so, individually or in the aggregate, could not
reasonably be expected to result in a Material Adverse Effect.
SECTION 4.09. Investment and Holding Company Status. Neither the
Borrower nor any of its Subsidiaries is (a) an "investment company" as defined
in, or subject to regulation under, the Investment Company Act of 1940 or (b) a
"holding company" as defined in, or subject to regulation under, the Public
Utility Holding Company Act of 1935.
SECTION 4.10. Taxes. Each of the Borrower and its Subsidiaries has
timely filed or caused to be filed all Tax returns and reports required to have
been filed and has paid or caused to be paid all Taxes required to have been
paid by it, except (a) Taxes that are being contested in good faith by
appropriate proceedings and for which such Person has set aside on its books
adequate reserves or (b) to the extent that the failure to do so could not
reasonably be expected to result in a Material Adverse Effect.
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SECTION 4.11. ERISA. No ERISA Event has occurred or is reasonably
expected to occur that, when taken together with all other such ERISA Events for
which liability is reasonably expected to occur, could reasonably be expected to
result in a Material Adverse Effect. The present value of all accumulated
benefit obligations under each Plan (based on the assumptions used for purposes
of Statement of Financial Accounting Standards No. 87) did not, as of the date
of the most recent financial statements reflecting such amounts, exceed by more
than $2,500,000 the fair market value of the assets of such Plan, and the
present value of all accumulated benefit obligations of all underfunded Plans
(based on the assumptions used for purposes of Statement of Financial Accounting
Standards No. 87) did not, as of the date of the most recent financial
statements reflecting such amounts, exceed by more than $4,000,000 the fair
market value of the assets of all such underfunded Plans.
SECTION 4.12. Disclosure. The Borrower has disclosed to the Lenders
all agreements, instruments and corporate or other restrictions to which it or
any of its Subsidiaries is subject, and all other matters known to it, that,
individually or in the aggregate, could reasonably be expected to result in a
Material Adverse Effect. None of the reports, financial statements, certificates
or other information (including, without limitation, the Information Memorandum)
furnished by or on behalf of the Obligors to the Lenders in connection with the
negotiation of this Agreement and the other Credit Documents or delivered
hereunder or thereunder (as modified or supplemented by other information so
furnished) contains any material misstatement of fact or omits to state any
material fact necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading; provided that, with
respect to projected financial information, the Borrower represents only that
such projected financial information was prepared in good faith based upon
assumptions believed to be reasonable at the time, it being recognized by the
Lenders that such projected financial information include forward-looking
statements that by their very nature are subject to significant risks,
uncertainties and contingencies, many of which are beyond the control of the
Borrower and its Subsidiaries and that actual results may differ, perhaps
materially, from those expressed or implied in such forward-looking statements.
There is no fact known to the Borrower or any of its Subsidiaries that could
reasonably be expected to have a Material Adverse Effect that has not been
disclosed herein, in the other Credit Documents or in a report, financial
statement, exhibit, schedule, disclosure letter or other writing furnished to
the Lenders for use in connection with the Transactions.
SECTION 4.13. Use of Credit. Neither the Borrower nor any of its
Subsidiaries is engaged principally, or as one of its important activities, in
the business of extending credit for the purpose, whether immediate, incidental
or ultimate, of buying or carrying Margin Stock, and no part of the proceeds of
any extension of credit hereunder will be used to buy or carry any Margin Stock.
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SECTION 4.14. Debt Agreements and Liens.
(a) Debt Agreements. Part A of Schedule II is a complete and correct
list of each credit agreement, loan agreement, indenture, purchase agreement,
guarantee, letter of credit or other arrangement providing for or otherwise
relating to any Indebtedness or any extension of credit (or commitment for any
extension of credit) to, or guarantee by, the Borrower or any of its
Subsidiaries outstanding on the date hereof, or that (after giving effect to the
transactions contemplated to occur on or before the Effective Date) will be
outstanding on the Effective Date, and the aggregate principal or face amount
outstanding or that may become outstanding under each such arrangement is
correctly described in Part A of Schedule II.
(b) Liens. Part B of Schedule II is a complete and correct list of
each Lien securing Indebtedness of any Person outstanding on the date hereof
(other than intercompany debt among the Borrower and the Subsidiary Guarantors),
or that (after giving effect to the transactions contemplated to occur on or
before the Effective Date) will be outstanding on the Effective Date and
covering any property of the Borrower or any of its Subsidiaries, and the
aggregate Indebtedness secured (or that may be secured) by each such Lien and
the property covered by each such Lien is correctly described in Part B of
Schedule II.
SECTION 4.15. Capitalization. As of March 17, 1999 the authorized
capital stock of the Borrower consists, of an aggregate of 31,000,000 shares
consisting of (i) 30,000,000 shares of common stock, par value $0.01 per share,
of which, 23,764,572 shares are duly and validly issued and outstanding (and
659,355 shares of which will be held in treasury), each of which shares will be
fully paid and nonassessable and (ii) 1,000,000 shares of preferred stock, none
of which is issued, outstanding or held in treasury.
SECTION 4.16. Subsidiaries and Investments.
(a) Subsidiaries. Set forth in Part A of Schedule VI is a complete
and correct list of all of the Subsidiaries of the Borrower as of the date
hereof, and as of the Effective Date (after giving effect to the Acquisition),
together with, for each such Subsidiary, (i) the jurisdiction of organization of
such Subsidiary, (ii) each Person holding ownership interests in such Subsidiary
(except that, in the case of non-Wholly Owned Subsidiaries, the identity of the
owners other than the Borrower and its Subsidiaries need not be specified) and
(iii) the nature of the ownership interests held by each such Person and the
percentage of ownership of such Subsidiary represented by such ownership
interests. Except as disclosed in Part A of Schedule VI, (x) each of the
Borrower and its Subsidiaries owns, or will own on the Effective Date (after
giving effect to the transactions contemplated to occur on or before the
Effective Date), free and clear of Liens (other than Liens created pursuant to
the Security Documents), and has the unencumbered right to vote, all outstanding
ownership interests in each Person shown to be held by it in Part A of
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Schedule VI, (y) all of the issued and outstanding capital stock of each such
Person organized as a corporation is validly issued, fully paid and
nonassessable and (z) there are no outstanding Equity Rights with respect to
such Person.
(b) Investments. Set forth in Part B of Schedule VI is a complete
and correct list of all Investments (other than Investments disclosed in Part A
of Schedule VI and other than Investments of the types referred to in clauses
(b), (c), (d), (e) and (f) of Section 7.04) held by the Borrower or any of its
`Subsidiaries in any Person on the date hereof or that will be held on the
Effective Date (after giving effect to the transactions contemplated to occur on
or before the Effective Date) and, for each such Investment, (x) the identity of
the Person or Persons holding such Investment and (y) the nature of such
Investment. Except as disclosed in Part B of Schedule VI, each of the Borrower
and its Subsidiaries owns (or will own, after giving effect to the transactions
contemplated to occur on or before the Effective Date), free and clear of all
Liens (other than Liens created pursuant to the Security Documents), all such
Investments.
(c) Restrictions on Subsidiaries. None of the Subsidiaries of the
Borrower is, on the date hereof, subject to any indenture, agreement, instrument
or other arrangement of the type described in Section 7.07.
SECTION 4.17. Real Property. Set forth on Schedule VII is a list, as
of the date hereof, and as of the Effective Date (after giving effect to the
transactions contemplated to occur on or before the Effective Date), of all of
the real property interests held by the Borrower and its Subsidiaries,
indicating in each case whether the respective property is owned or leased, the
identity of the owner or lessee and the location of the respective property. No
Mortgage encumbers (or will encumber) real property which is located in an area
that has been identified as an area having special flood hazards and in which
flood insurance has been made available under the National Flood Insurance Act
of 1968 (other than as identified in Schedule VII).
SECTION 4.18. Solvency. As of the Effective Date and after giving
effect to the initial extensions of credit hereunder and to the other
Transactions contemplated hereby (including, without limitation, the
consummation of the Acquisition), (a) the aggregate value of all properties of
the Borrower and its Subsidiaries at their present fair saleable value (i.e.,
the amount that may be realized within a reasonable time, considered to be six
months to one year, either through collection or sale at the regular market
value, conceiving the latter as the amount that could be obtained for the
property in question within such period by a capable and diligent businessman
from an interested buyer who is willing to purchase under ordinary selling
conditions, and determined on a going concern basis), exceeds the amount of all
the debts and liabilities (including contingent, subordinated, unmatured and
unliquidated liabilities) of the Borrower and its Subsidiaries, (b) the Borrower
and its Subsidiaries will not, on a consolidated basis, have an unreasonably
small capital with which to conduct their business operations as
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heretofore conducted and (c) the Borrower and its Subsidiaries will have, on a
consolidated basis, sufficient cash flow to enable them to pay their debts as
they mature.
SECTION 4.19. Labor Matters. Except as set forth in Schedule VIII,
(a) on the date hereof neither the Borrower nor any of its Subsidiaries nor any
of their respective employees is subject to any collective bargaining agreement,
(b) on the date hereof, no petition for certification or union election is
pending with respect to the employees of the Borrower or any of its Subsidiaries
and no union or collective bargaining unit has sought certification or
recognition with respect to the employees of any such Person within the
three-year period ending on the Effective Date and (c) there are no strikes or
other labor disputes against the Borrower or any of its Subsidiaries pending or,
to the knowledge of the Borrower, threatened, other than any thereof that
(individually or in the aggregate) could reasonably be expected to have a
Material Adverse Effect. Hours worked by and payment made to employees of the
Borrower and its Subsidiaries have not been in violation of the Fair Labor
Standards Act or any other applicable law, regulation or order of any
Governmental Authority dealing with such matters that (individually or in the
aggregate) could reasonably be expected to have a Material Adverse Effect. All
payments due from the Borrower or any of its Subsidiaries on account of employee
health and welfare insurance that (individually or in the aggregate) could
reasonably be expected to have a Material Adverse Effect if not paid have been
paid or accrued as a liability on the books of the Borrower or the relevant
Subsidiary.
SECTION 4.20. No Burdensome Restrictions. Neither the Borrower nor
any of its Subsidiaries is a party to any agreement or other contractual
arrangement imposing burdensome requirements upon the Borrower or any of its
Subsidiaries that, taking into account the benefits of such agreement or other
arrangement to the Borrower or such Subsidiary, could reasonably be expected to
result in a Material Adverse Effect.
SECTION 4.21. Acquisition. As of the Effective Date (a) each of the
representations and warranties of each of the Borrower and/or its Subsidiaries,
MVE Holdings and MVE Investors in the respective Merger Agreement to which it is
a party are true and accurate as though made on or as of the Effective Date
(except for those representations and warranties that address matters only as of
a particular date or only with respect to a specific period of time which need
only be true and accurate as of such date or with respect to such period and
except for the representation of MVE Holdings set forth in Section 3.6 of the
MVE Holdings Merger Agreement which only needs to be true and correct as of the
date of the MVE Holdings Merger Agreement, except where the failure of any such
representation or warranty of MVE Holdings or MVE Investors to be true and
accurate (without giving effect to any limitation as to "materiality" or
"material adverse effect" set forth therein) does not have a Material Adverse
Effect (as such term is defined in the respective Merger Agreement) on the
Company or a materially adverse effect on MVE Holdings' or MVE Investors' (as
the case may be) ability to
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consummate the merger contemplated by the respective Merger Agreement or the
other transactions contemplated thereby and (b) there has been no Material
Adverse Change (as such term is defined in the MVE Holdings Merger Agreement).
ARTICLE V
CONDITIONS
SECTION 5.01. Effective Date. The obligations of the Lenders to make
Loans and of the Issuing Lenders to issue (or, in the case of the Existing
Letters of Credit, continue) Letters of Credit hereunder shall not become
effective until the date on which the Administrative Agent shall have received
each of the following documents, each of which shall be satisfactory to the
Administrative Agent (and to the extent specified below, to each Lender) in form
and substance (or such condition shall have been waived in accordance with
Section 10.02):
(a) Executed Counterparts. From each party hereto either (i) a
counterpart of this Agreement signed on behalf of such party or (ii)
written evidence satisfactory to the Administrative Agent (which may
include telecopy transmission of a signed signature page to this
Agreement) that such party has signed a counterpart of this Agreement.
(b) Opinion of Counsel to the Obligors. A favorable written opinion
(addressed to the Administrative Agent and the Lenders and dated the
Effective Date) of (i) Calfee, Halter & Griswold LLP, counsel for the
Obligors, and (ii) such other counsel to one or more of the Obligors, in
each case in form and substance satisfactory to the Administrative Agent
covering such matters relating to the Obligors, this Agreement and/or the
Transactions (and each Obligor hereby instructs such counsel to deliver
such opinion to the Lenders and the Administrative Agent).
(c) Opinion of Special New York Counsel to Chase. An opinion, dated
the Effective Date, of Milbank, Tweed, Hadley & McCloy LLP, special New
York counsel to Chase, substantially in form and substance satisfactory to
the Administrative Agent (and Chase hereby instructs such counsel to
deliver such opinion to the Lenders).
(d) Corporate Documents. Such documents and certificates as the
Administrative Agent or its counsel may reasonably request relating to the
organization, existence and good standing of each Obligor, the
authorization of the Transactions and any other legal matters relating to
the Obligors, this Agreement or the Transactions, all in form and
substance reasonably satisfactory to the Administrative Agent and its
counsel.
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(e) Officer's Certificate. A certificate, dated the Effective Date
and signed by the President, a Vice President or a Financial Officer of
the Borrower, confirming compliance with the conditions set forth in the
lettered clauses of the first sentence of Section 5.02.
(f) Security Documents. (i) The Security Agreement substantially in
the form of Exhibit B hereto, duly executed and delivered by the Borrower,
the Subsidiary Guarantors in existence as of the Effective Date and the
Administrative Agent and (ii) a Foreign Subsidiary Pledge Agreement, in
form and substance satisfactory to the Administrative Agent, between each
Obligor that holds the equity interests of a Foreign Subsidiary (other
than Chart UK Investments Limited Partnership and the Administrative Agent
(or a sub-agent acting for the Administrative Agent), duly executed and
delivered by the parties thereto, together with (to the extent required by
the terms of any Security Document) the certificates (if any) held by the
respective Obligor and identified therein and undated stock powers
executed in blank. In addition, the respective Obligors shall have taken
such other action (including delivering to the Administrative Agent
pursuant to each such Security Document for filing, appropriately
completed and duly executed copies of Uniform Commercial Code financing
statements) as the Administrative Agent shall have requested in order to
perfect the security interests created pursuant to each such Security
Document.
(g) Mortgage and Title Insurance. The following documents, each of
which shall be executed (and, where appropriate, acknowledged) by Persons
satisfactory to the Administrative Agent:
(i) one or more Mortgages covering certain real property of
the Borrower and/or the Subsidiary Guarantors in existence as of the
Effective Date identified in Schedule VII, in each case duly
executed and delivered by the respective owner or lessee of such
property in recordable form (in such number of copies as the
Administrative Agent shall have requested) and, to the extent
necessary with respect to any leasehold property to be subjected to
a Mortgage, consents of the respective landlords with respect to
such property;
(ii) one or more mortgagee policies of title insurance on
forms of and issued by First American Title Insurance Company and/or
any other title company satisfactory to the Administrative Agent
(the "Title Companies"), insuring the validity and priority of the
Liens created under each such Mortgage for and in amounts
satisfactory to the Administrative Agent, subject only to such
exceptions as are satisfactory to the Administrative Agent and, to
the extent necessary under applicable law, for filing in the
appropriate county land office(s), Uniform
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Commercial Code financing statements covering fixtures, in each case
appropriately completed and duly executed;
(iii) as-built surveys of recent date of each of the
facilities to be covered by each such Mortgage, showing such matters
as may be required by the Administrative Agent, which surveys shall
be in form and content acceptable to the Administrative Agent, and
certified to the Administrative Agent and to each Lender and the
Title Companies, and shall have been prepared by a registered
surveyor acceptable to the Administrative Agent;
(iv) certified copies of permanent and unconditional
certificates of occupancy (or, if it is not the practice to issue
certificates of occupancy in the jurisdiction in which the
facilities to be covered by each such Mortgage are located, then
such other evidence reasonably satisfactory to the Administrative
Agent) permitting the fully functioning operation and occupancy of
each such facility and of such other permits necessary for the use
and operation of each such facility issued by the respective
governmental authorities having jurisdiction over each such
facility; and
(v) opinions, each dated the Effective Date, of local counsel
in each of the respective states in which the properties covered by
the Mortgages executed and delivered under this clause (g) are
located, in form and substance satisfactory to the Administrative
Agent (and the Borrower hereby instructs such counsel to deliver
such opinion(s) to the Lenders and the Administrative Agent).
In addition, the Borrower shall have paid to the Title Companies all
expenses and premiums of the Title Companies in connection with the
issuance of such policies and in addition shall have paid to the Title
Companies an amount equal to the recording and stamp taxes payable in
connection with recording each such Mortgage in the appropriate county
land office(s).
(h) Insurance. Certificates of insurance evidencing the existence of
all insurance required to be maintained by the Borrower pursuant to
Section 6.05(b) and the designation of the Administrative Agent as the
loss payee or additional named insured, as the case may be, thereunder to
the extent required by Section 6.05(b), such certificates to be in such
form and contain such information as is specified in Section 6.05(b). In
addition, the Borrower shall have delivered a certificate of a Financial
Officer of the Borrower setting forth the insurance obtained by it in
accordance with the requirements of Section 6.05(b) and stating that such
insurance is in full force and effect and that all premiums then due and
payable thereon have been paid.
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(i) Solvency Certificate. A certificate of the chief financial
officer of the Borrower as to the solvency of the Borrower as of the
Effective Date and after giving effect to the initial extension of credit
hereunder, the Acquisition and to the other transactions contemplated
hereby.
(j) Repayment of Existing Indebtedness. Evidence that the principal
of and interest on, and all other amounts owing in respect of, the
Indebtedness (including any contingent or other amounts payable in respect
of letters of credit) indicated on Schedule II (including, without
limitations, all amounts outstanding under the Existing Credit Agreement)
that is to be repaid on the Effective Date shall have been (or shall be
simultaneously) paid in full, that any commitments to extend credit under
the agreements or instruments relating to such Indebtedness shall have
been canceled or terminated and that all Guarantees in respect of, and all
Liens securing, any such Indebtedness shall have been released (or
arrangements for such release satisfactory to the Administrative Agent
shall have been made).
(k) Acquisition. Evidence that:
(i) the Acquisition shall be simultaneously consummated in
accordance with the terms of the Acquisition Documents without
giving effect to any modification, supplement or waiver thereof not
approved by the Required Lenders;
(ii) without limiting the foregoing, each of the conditions
set forth in clauses (a), (b) and (c) of Section 7.2 of the MVE
Holdings Merger Agreement shall have been satisfied without giving
effect to any modification, supplement or waiver thereof not
approved by the Required Lenders;
(iii) all governmental and third party approvals in connection
with the Transactions shall have been obtained and be in full force
and effect, and all applicable waiting periods shall have expired
without any action being taken or threatened by any competent
authority which would restrain, prevent or otherwise impose
materially adverse conditions on the Transactions or the financing
thereof;
(iv) there shall be no action, suit or proceeding at law or in
equity or by or before any Governmental Authority pending or, to the
knowledge of the Borrower, threatened against the Borrower or any
other party to the Acquisition Documents or relating to the
Transactions that could reasonably be expected to have a material
adverse effect on the ability of the Borrower or any of the other
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parties to the Acquisition Documents to consummate the Transactions
or that could reasonably be expected to restrain, prevent or impose
materially burdensome conditions on any of the Transactions;
(v) the aggregate consideration and other amounts payable by
the Borrower and its Subsidiaries in connection with the
consummation of the Acquisition shall not exceed $254,300,000
(including the aggregate amount of the Indebtedness assumed in
connection therewith); and
(vi) the sources and uses of the funds for the consummation of
the Acquisition and the other transactions contemplated to occur in
connection therewith shall be as set forth in the Information
Memorandum;
and the Administrative Agent shall have received a certificate of a
Financial Officer of the Borrower to such effect and to the effect that
attached thereto are true and complete copies of each of the documents
delivered in connection with the closing of the Acquisition pursuant to
the Merger Agreements. In addition, the Administrative Agent shall have
received copies of the legal opinions (if any) delivered to the Borrower
pursuant to the Merger Agreements in connection with the Acquisition,
together with a letter from each Person delivering such opinion (or
authorization within such opinion) authorizing reliance thereon by the
Administrative Agent and the Lenders, it being understood that the
Borrower shall request counsel for MVE Holdings and MVE Investors to
deliver such a reliance letter.
(l) Offer to Purchase. A true and complete copy of the Offer to
Purchase prepared by the Borrower and in the final form mailed to the
holders of the Senior Secured Notes.
(m) Lien Searches. The results of a recent search, by a Person
satisfactory to the Administrative Agent, of Uniform Commercial Code,
judgment and tax lien filings in each relevant jurisdiction where property
of the Obligors is located, and the results of such search shall reveal no
Liens on any of the property of the Obligors except for those permitted
under Section 7.02 or Liens to be discharged on or prior to the Effective
Date pursuant to documentation satisfactory to the Administrative Agent.
(n) Approvals. All material governmental and third party approvals
(including landlords' and other consents) necessary or, in the discretion
of the Administrative Agent, advisable in connection with the Acquisition,
the financing contemplated hereby and the continuing operations of the
Borrower and its Subsidiaries (including, without limitation, the
ownership of the Property to be acquired pursuant to the Acquisition)
shall have been
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obtained and be in full force and effect, and all applicable waiting
periods shall have expired without any action being taken or threatened by
any competent authority which would restrain, prevent or otherwise impose
adverse conditions on the Acquisition or the financing thereof.
(o) Other Documents. Such other documents as the Administrative
Agent or any Lender or special New York counsel to Chase may reasonably
request.
The obligation of any Lender to make its initial extension of credit
hereunder is also subject to the payment by the Borrower of such fees as the
Borrower shall have agreed to pay to any Lender or the Administrative Agent in
connection herewith, including the reasonable fees and expenses of Milbank,
Tweed, Hadley & McCloy LLP, special New York counsel to Chase, in connection
with the negotiation, preparation, execution and delivery of this Agreement and
the other Credit Documents and the extensions of credit hereunder (to the extent
that statements for such fees and expenses have been delivered to the Borrower).
The Administrative Agent shall notify the Borrower and the Lenders
of the Effective Date, and such notice shall be conclusive and binding.
Notwithstanding the foregoing, the obligations of the Lenders to make Loans and
of the Issuing Lenders to issue Letters of Credit hereunder shall not become
effective unless each of the foregoing conditions is satisfied (or waived
pursuant to Section 10.02) on or prior to 3:00 p.m., New York City time, on
April 22, 1999 (and, in the event such conditions are not so satisfied or
waived, the Commitments shall terminate at such time).
SECTION 5.02. Each Credit Event. The obligation of each Lender to
make a Loan on the occasion of any Borrowing, and of each Issuing Lender to
issue, continue, amend, renew or extend any Letter of Credit, is subject to the
satisfaction of the following conditions:
(a) the representations and warranties of the Borrower set forth in
this Agreement, and of each Obligor in each of the Credit Documents to
which it is a party, shall be true and correct on and as of the date of
such Borrowing or the date of issuance, amendment, renewal or extension of
such Letter of Credit, as applicable; and
(b) at the time of and immediately after giving effect to such
Borrowing or the issuance, amendment, renewal or extension of such Letter
of Credit, as applicable, no Default shall have occurred and be
continuing.
Each Borrowing and each issuance, amendment, renewal or extension of a Letter of
Credit shall be deemed to constitute a representation and warranty by the
Borrower on the date thereof as to the matters specified in the preceding
sentence.
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SECTION 5.03. Conditions to Application of Term Loan Proceeds. The
proceeds of the Term Loans (including any proceeds that have been deposited into
the Bond Tender Offer Collateral Account pursuant to Section 2.06(c)) shall not
be applied to pay any amounts payable in respect of the consummation of the Bond
Tender Offer unless and until (a) each of the conditions to the Offer to
Purchase shall have been satisfied (or waived with the concurrence of the
Required Lenders) and (b) each of the following conditions shall be satisfied
(to the satisfaction of the Administrative Agent (and, in the case of each
document required to be delivered below, such document shall be satisfactory to
the Administrative Agent in form and substance), unless such condition shall
have been waived in accordance with Section 10.02:
(i) evidence of the tendering and acceptance for purchase of at
least $75,000,000 of the Senior Secured Notes at an average price not
exceeding 111.6% of the par value of such Senior Secured Notes pursuant to
the Bond Tender Offer;
(ii) a Supplemental Indenture (as defined in the Offer to Purchase)
duly executed by the trustee party thereto as consented to by the holders
of at least 66-2/3rds in principal amount of the Senior Secured Notes
providing for the effectiveness of the "Proposed Amendments" (as defined
in the Offer to Purchase) to the Senior Secured Notes Indenture;
(iii) a Guarantee Assumption Agreement, duly completed and executed
by each of MVE Holdings and its Subsidiaries (other than any Foreign
Subsidiaries of MVE Holdings) and the Administrative Agent;
(iv) the MVE Guarantee Agreement in form and substance satisfactory
to the Administrative Agent, duly executed and delivered by MVE and the
Administrative Agent in connection with the Mortgage(s) to be entered into
by MVE hereunder in respect of certain of its real property interests
located in the State of Minnesota;
(v) such documents (including shares of stock, Uniform Commercial
Code financing statements and mortgages or deeds of trust covering the
real property identified on Schedule VII and fixtures owned or leased by
MVE and its Subsidiaries, other than any Foreign Subsidiaries of MVE
Holdings) as shall be necessary to create and perfect valid and
enforceable first priority Liens on substantially all of the property of
MVE and its Subsidiaries as collateral security for the obligations of MVE
and its Subsidiaries hereunder;
(vi) such documents and certificates as the Administrative Agent or
its counsel may reasonably request relating to the organization, existence
and good standing of MVE
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and its Subsidiaries, opinions of counsel and other documents as is
consistent with those delivered by each Obligor pursuant to Section 5.01
on the Effective Date or as the Administrative Agent shall have requested;
(vii) a certificate dated the Bond Tender Offer Closing Date and
signed by a Financial Officer of the Borrower certifying (i) as to
satisfaction of the conditions under clause (a) of this Section, (ii) the
representations and warranties of the Borrower set forth in this
Agreement, and of each Obligor (including MVE Holdings and its
Subsidiaries) in each of the Credit Documents to which it is a party
(including, without limitation, the Credit Documents executed and
delivered pursuant to this Section), shall be true and correct on and as
of the Bond Tender Offer Closing Date; and (iii) as of the Bond Tender
Offer Closing Date, no Default shall have occurred and be continuing; and
(viii) such other documents as the Administrative Agent or any
Lender or special New York counsel to Chase may reasonably request.
ARTICLE VI
AFFIRMATIVE COVENANTS
Until the Commitments have expired or been terminated and the
principal of and interest on each Loan and all fees payable hereunder shall have
been paid in full and all Letters of Credit shall have expired or terminated and
all LC Disbursements shall have been reimbursed, the Borrower covenants and
agrees with the Lenders that:
SECTION 6.01. Financial Statements and Other Information. The
Borrower will furnish to the Administrative Agent and each Lender:
(a) within 90 days after the end of each fiscal year of the
Borrower, (i) the audited consolidated balance sheet and related
statements of operations, stockholders' equity and cash flows of the
Borrower and its Subsidiaries as of the end of and for such year, setting
forth in each case in comparative form the figures for the previous fiscal
year, all reported on by Ernst & Young LLP or other independent public
accountants of recognized national standing (without a "going concern" or
like qualification or exception and without any qualification or exception
as to the scope of such audit) to the effect that such consolidated
financial statements present fairly in all material respects the financial
condition and results of operations of the Borrower and its Subsidiaries
on a consolidated basis in accordance with GAAP consistently applied and
(ii) the unaudited consolidating balance sheets and related statements of
operations of each of the Borrower and its
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Subsidiaries as of the end of and for such year, setting forth in each
case in comparative form the figures for the previous fiscal year, all
certified by a Financial Officer of the Borrower as presenting fairly in
all material respects the respective consolidating financial condition and
results of operation of each of the Borrower and its Subsidiaries in
accordance with GAAP consistently applied, subject to normal year-end
audit adjustments and the absence of footnotes;
(b) within 45 days after the end of each fiscal quarter of the
Borrower, the unaudited consolidated and consolidating balance sheets and
related statements of operations (and in the case of consolidated
statements, related statements of stockholders equity and cash flows) of
the Borrower and its Subsidiaries as of the end of and for such fiscal
quarter and the then elapsed portion of the fiscal year, setting forth in
each case in comparative form the figures for (or, in the case of the
balance sheet, as of the end of) the corresponding period or periods of
the previous fiscal year, all certified by a Financial Officer of the
Borrower as presenting fairly in all material respects the consolidated or
respective consolidating, as the case may be, financial condition and
results of operations of the Borrower and/or its Subsidiaries, as the case
may be, in accordance with GAAP consistently applied, subject to normal
year-end audit adjustments and the absence of footnotes;
(c) concurrently with any delivery of financial statements under
clause (a) or (b) of this Section, a certificate of a Financial Officer of
the Borrower (i) certifying as to whether a Default has occurred and, if a
Default has occurred, specifying the details thereof and any action taken
or proposed to be taken with respect thereto, (ii) setting forth
reasonably detailed calculations demonstrating compliance with Sections
7.01, 7.05, 7.08 and 7.09, (iii) with respect to such financial statements
delivered under such clause (a), setting forth reasonably detailed
calculations of Excess Cash Flow as of the end of the relevant fiscal
year, and (iv) stating whether any change in GAAP or in the application
thereof has occurred since the date of the audited financial statements
referred to in Section 4.04 and, if any such change has occurred,
specifying the effect of such change on the financial statements
accompanying such certificate;
(d) concurrently with any delivery of financial statements under
clause (a) of this Section, a certificate of the accounting firm that
reported on such financial statements stating whether they obtained
knowledge during the course of their examination of such financial
statements of any Default (which certificate may be limited to the extent
required by accounting rules or guidelines);
(e) promptly upon receipt thereof, copies of all significant reports
submitted to the Borrower or any of its Subsidiaries by independent public
accountants in connection
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with each annual, interim or special audit of the financial statements of
the Borrower and its Subsidiaries made by such accountants, including the
comment letter submitted by such accountants to management in connection
with their annual audit;
(f) as soon as available but in any event no later than 60 days
after the commencement of each fiscal year of the Borrower, an annual
budget for such fiscal year of the Borrower and its Subsidiaries, setting
forth in comparative form the corresponding figures for the corresponding
periods in the immediately preceding fiscal year;
(g) promptly upon the mailing thereof to the holders of the Senior
Secured Notes, copies of all notices, requests, offers, demands, reports
or other information furnished to such holders;
(h) promptly after the same become publicly available, copies of all
periodic and other reports, proxy statements and other materials filed by
the Borrower or any of its Subsidiaries with the Securities and Exchange
Commission, or any Governmental Authority succeeding to any or all of the
functions of said Commission, or with any national securities exchange, or
distributed by the Borrower to its shareholders generally, as the case may
be; and
(i) promptly following any request therefor, such other information
regarding the operations, business affairs and financial condition of the
Borrower or any of its Subsidiaries, or compliance with the terms of this
Agreement and the other Credit Documents, as the Administrative Agent or
any Lender may reasonably request.
SECTION 6.02. Notices of Material Events. The Borrower will furnish
to the Administrative Agent and each Lender prompt written notice of the
following:
(a) the occurrence of (i) any Default or (ii) any Default under and
as defined in the Senior Secured Notes Indenture;
(b) the filing or commencement of any action, suit or proceeding by
or before any arbitrator or Governmental Authority against or affecting
the Borrower or any of its Affiliates that, if adversely determined, could
reasonably be expected to result in liability of the Borrower and its
Subsidiaries in an aggregate amount exceeding $5,000,000;
(c) the occurrence of any ERISA Event that, alone or together with
any other ERISA Events that have occurred, could reasonably be expected to
result in liability of the Borrower and its Subsidiaries in an aggregate
amount exceeding $5,000,000;
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(d) the assertion of any Environmental Claim by any Person against,
or with respect to the activities of, the Borrower or any of its
Subsidiaries and any alleged violation of or non-compliance with any
Environmental Laws or any permits, licenses or authorizations, other than
any Environmental Claim or alleged violation that, if adversely
determined, could reasonably be expected to result in liability of the
Borrower and its Subsidiaries in an aggregate amount exceeding $5,000,000;
and
(e) any other development that results in, or could reasonably be
expected to result in, a Material Adverse Effect.
Each notice delivered under this Section shall be accompanied by a statement of
a Financial Officer or other executive officer of the Borrower setting forth the
details of the event or development requiring such notice and any action taken
or proposed to be taken with respect thereto.
SECTION 6.03. Existence; Conduct of Business. The Borrower will, and
will cause each of its Subsidiaries to, do or cause to be done all things
necessary to preserve, renew and keep in full force and effect its legal
existence and the rights, licenses, permits, privileges and franchises material
to the conduct of its business; provided that the foregoing shall not prohibit
any merger, consolidation, liquidation or dissolution permitted under Section
7.03(a).
SECTION 6.04. Payment of Obligations. The Borrower will, and will
cause each of its Subsidiaries to, pay its obligations, including Tax
liabilities, that, if not paid, could result in a Material Adverse Effect before
the same shall become delinquent or in default, except where (a) the validity or
amount thereof is being contested in good faith by appropriate proceedings, (b)
the Borrower or such Subsidiary has set aside on its books adequate reserves
with respect thereto in accordance with GAAP and (c) the failure to make payment
pending such contest could not reasonably be expected to result in a Material
Adverse Effect.
SECTION 6.05. Maintenance of Properties; Insurance. The Borrower
will, and will cause each of its Subsidiaries to, (a) keep and maintain all
property material to the conduct of its business in good working order and
condition, ordinary wear and tear excepted, and (b) maintain, with financially
sound and reputable insurance companies, insurance in such amounts and against
such risks as are customarily maintained by companies engaged in the same or
similar businesses operating in the same or similar locations.
SECTION 6.06. Books and Records; Inspection. The Borrower will, and
will cause each of its Subsidiaries to, keep proper books of record and account
in which full, true and correct entries are made of all dealings and
transactions in relation to its business and activities. The Borrower will, and
will cause each of its Subsidiaries to, permit any representatives
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designated by the Administrative Agent or any Lender, upon reasonable prior
notice, to visit and inspect its properties, to examine and make extracts from
its books and records, and to discuss its affairs, finances and condition with
its officers, employees and independent accountants, all at such reasonable
times and as often as reasonably requested (which visits and inspections shall
be at the Borrower's sole expense after the occurrence and during the
continuance of any Default or in the case of any visit or inspection by the
Administrative Agent and at the Lenders' sole expense at any other time).
SECTION 6.07. Compliance with Laws. The Borrower will, and will
cause each of its Subsidiaries to, comply with all applicable laws (including,
without limitation, Environmental Laws), rules, regulations, orders, permits or
other authorization of or from any Governmental Authority, except where the
failure to do so, individually or in the aggregate, could not reasonably be
expected to result in a Material Adverse Effect.
SECTION 6.08. Use of Proceeds and Letters of Credit. The proceeds of
the Loans will be used only to finance the Acquisition, to refinance, in part,
certain existing Indebtedness of the Borrower and its Subsidiaries and for
working capital and other general corporate purposes of the Borrower and its
Subsidiaries in the ordinary course of business. Upon satisfaction of each of
the conditions in Section 5.03, a portion of the proceeds of the Term Loans will
be used to pay the purchase price and related amounts in respect of the
consummation of the Bond Tender Offer. No part of the proceeds of any Loan will
be used, whether directly or indirectly, for any purpose that entails a
violation of any of the Regulations of the Board, including Regulations T, U and
X.
SECTION 6.09. Hedging Agreements. The Borrower will within 90 days
of the Effective Date enter into, and thereafter maintain in full force and
effect, one or more Hedging Agreements with one or more of the Lenders or any of
their respective Affiliates (and/or with a bank or other financial institution
having capital, surplus and undivided profits of at least $500,000,000), that
effectively enables the Borrower (in a manner satisfactory to the Administrative
Agent) to protect itself against interest rate exposure as to a notional
principal amount at least equal to 50% of the aggregate outstanding principal
amount of the Term Loans for a period of at least three years measured from the
Effective Date.
SECTION 6.10. Certain Obligations Respecting Subsidiaries and
Collateral.
(a) Subsidiary Guarantors. The Borrower will take such action, and
will cause each of its Subsidiaries to take such action, from time to time as
shall be necessary to ensure that all Subsidiaries of the Borrower are
"Subsidiary Guarantors" hereunder; provided that, notwithstanding anything
herein to the contrary, the following Subsidiaries shall not be, or be required
to become, Subsidiary Guarantors: (i) CHD and any of its Subsidiaries; (ii) any
Foreign
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Subsidiary and any of its Subsidiaries; and (iii) prior to the Bond Tender Offer
Closing Date, MVE and its Subsidiaries. Without limiting the generality of the
foregoing, in the event that the Borrower or any of its Subsidiaries shall form
or acquire any new Subsidiary (other than a Foreign Subsidiary) that shall
constitute a Subsidiary hereunder, the Borrower and its Subsidiaries will cause
such new Subsidiary to:
(i) become a "Subsidiary Guarantor" hereunder and an "Obligor" and
an "Issuer" under the Security Agreement pursuant to a Guarantee
Assumption Agreement;
(ii) cause such Subsidiary to take such action (including delivering
such shares of stock, executing and delivering such Uniform Commercial
Code financing statements and executing and delivering mortgages or deeds
of trust covering the real property and fixtures owned or leased by such
Subsidiary) as shall be necessary to create and perfect valid and
enforceable first priority Liens on substantially all of the property of
such new Subsidiary as collateral security for the obligations of such new
Subsidiary hereunder; and
(iii) deliver such proof of corporate action, incumbency of
officers, opinions of counsel and other documents as is consistent with
those delivered by each Obligor pursuant to Section 5.01 on the Effective
Date or as the Administrative Agent shall have requested.
Notwithstanding the foregoing, if such new Subsidiary is a Foreign
Subsidiary such new Subsidiary shall not be required to become a Subsidiary
Guarantor hereunder or an Obligor under the Security Agreement, but the Borrower
will, and will cause each of its Subsidiaries, to pledge the shares of capital
stock of each Foreign Subsidiary that is directly owned by a Subsidiary which is
not a Foreign Subsidiary to the Administrative Agent (for the benefit of the
Lenders) under the Security Agreement (or, at the request of the Administrative
Agent, under a Foreign Subsidiary Pledge Agreement in form and substance
satisfactory to the Administrative Agent), provided that such pledge shall not
cover more than (x) 65% of the voting capital stock of such Foreign Subsidiary
having ordinary voting power for the election of the board of directors of such
Subsidiary and (y) 100% of all other capital stock of such Foreign Subsidiary.
(b) Ownership of Subsidiaries. The Borrower will, and will cause
each of its Subsidiaries to, take such action from time to time as shall be
necessary to ensure that each of its Subsidiaries is a Wholly Owned Subsidiary,
provided that, in the case of any Subsidiary that as of the Effective Date is
not a Wholly Owned Subsidiary as identified on Schedule VI, the Borrower will,
and will cause of its Subsidiaries to, own not less than the percentage of such
ownership interests of such Subsidiaries owned as of the Effective Date. In the
event that any
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shares of stock or other equity interests shall be issued by any Subsidiary
(including, without limitation, any Subsidiary formed or acquired after the date
hereof), subject (in the case of any Foreign Subsidiary) to the last paragraph
of paragraph (a) of this Section, the respective Obligor agrees forthwith to
deliver to the Administrative Agent pursuant to the relevant Security Document
the certificates (if any) evidencing such shares of stock or other equity
interests, accompanied by undated stock powers executed in blank and to take
such other action as the Administrative Agent shall request to perfect the
security interest created therein pursuant to the relevant Security Document.
(c) Real Property. Promptly upon (but in any event within 30 days
following) the acquisition of any real property interests (including leasehold
interests) after the Effective Date, the Borrower will, and will cause each of
the Subsidiary Guarantors to, execute and deliver from time to time a Mortgage
covering such real property as collateral security for the obligations of the
Obligors under this Agreement and the other Credit Documents, together with the
other instruments and documents with respect thereto consistent with the
requirements under Section 5.01(g), each in form and substance satisfactory to
the Administrative Agent.
SECTION 6.11. Senior Secured Notes.
(a) Upon the consummation of the Acquisition, the Borrower will
cause MVE to make a Change of Control Offer (as defined in the Senior Secured
Notes Indenture) in accordance with Section 4.14 of the Senior Secured Notes
Indenture.
(b) In the event that the Bond Tender Offer Closing Date shall not
have occurred prior to the date 40 days after the Effective Date, the Borrower
will, promptly after February 15, 2000 (but not later than April 15, 2000),
cause MVE to redeem in full all of the outstanding Senior Secured Notes in
accordance with Section 5 of the Senior Secured Notes.
ARTICLE VII
NEGATIVE COVENANTS
Until the Commitments have expired or terminated and the principal
of and interest on each Loan and all fees payable hereunder have been paid in
full and all Letters of Credit have expired or terminated and all LC
Disbursements shall have been reimbursed, the Borrower covenants and agrees with
the Lenders that:
SECTION 7.01. Indebtedness. The Borrower will not, nor will it
permit any of its Subsidiaries to, create, incur, assume or permit to exist any
Indebtedness, except:
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(a) Indebtedness created hereunder and under the other Credit
Documents;
(b) Indebtedness (including the Senior Secured Notes) existing on
the date hereof and set forth in Part A of Schedule II (excluding,
however, following the making of the initial Loans hereunder, the
Indebtedness to be repaid with the proceeds of such Loans, as indicated on
Schedule II), and any extensions, renewals or replacements of any such
Indebtedness (other than the Senior Secured Notes);
(c) (i) unsecured Indebtedness of the Borrower owing to any
Subsidiary (including Guarantees by the Borrower of Indebtedness of any
Subsidiary), provided that, in case of any such Indebtedness owing to, or
any such Guarantee of Indebtedness of, any Subsidiary which is not a
Subsidiary Guarantor, the payment of such Indebtedness (or such Guarantee,
as the case may be) shall be subordinated to the prior payment in full of
all obligations of the Borrower under the Credit Documents; or (ii)
Indebtedness of any Subsidiary owing to the Borrower or any other
Subsidiary (including Guarantees by any Subsidiary of Indebtedness of the
Borrower or any other Subsidiary), provided that, in the case of any such
Indebtedness owing by any Subsidiary Guarantor to, or any such Guarantee
by any Subsidiary Guarantor of Indebtedness of, any Subsidiary which is
not a Subsidiary Guarantor, the payment of such Indebtedness (or such
Guarantee, as the case may be) shall be subordinated to the prior payment
in full of all obligations of such Subsidiary Guarantor under the Credit
Documents; provided further that the aggregate amount of all such
Guarantees by the Obligors of Indebtedness of Subsidiaries that are not
Subsidiary Guarantors shall not exceed $30,000,000 at any time outstanding
(which shall include any such Guarantees outstanding as of the Effective
Date so long as the same remain outstanding);
(d) Indebtedness of the Borrower or any Subsidiary incurred to
finance the acquisition, construction or improvement of any fixed or
capital assets, including Capital Lease Obligations, and extensions,
renewals and replacements of any such Indebtedness that do not increase
the outstanding principal amount thereof; provided that (i) the amount of
such Indebtedness does not exceed the purchase or acquisition price or
such asset (or any such improvement) and (ii) the aggregate principal
amount of Indebtedness permitted by this clause (d) shall not exceed
$10,000,000 at any time outstanding; and
(e) other unsecured Indebtedness in an aggregate principal amount
not exceeding $20,000,000 at any time outstanding.
SECTION 7.02. Liens. The Borrower will not, nor will it permit any
of its Subsidiaries to, create, incur, assume or permit to exist any Lien on any
property or asset now
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owned or hereafter acquired by it, or assign or sell any income or revenues
(including accounts receivable) or rights in respect of any thereof, except:
(a) Liens created pursuant to the Security Documents;
(b) Permitted Encumbrances;
(c) any Lien on any property or asset of the Borrower or any of its
Subsidiaries existing on the date hereof and set forth in Part B of
Schedule II (excluding, however, following the making of the initial Loans
hereunder, Liens securing Indebtedness to be repaid with the proceeds of
such Loans, as indicated on Schedule II); provided that (i) no such Lien
shall extend to any other property or asset of the Borrower or any of its
Subsidiaries and (ii) any such Lien shall secure only those obligations
which it secures on the date hereof and extensions, renewals and
replacements thereof that do not increase the outstanding principal amount
thereof; and
(d) Liens on fixed or capital assets acquired, constructed or
improved by the Borrower or any Subsidiary, securing Indebtedness
permitted by clause (d) of Section 7.01.
SECTION 7.03. Fundamental Changes.
(a) Mergers, Consolidations, Etc. The Borrower will not, nor will it
permit any of its Subsidiaries to, merge into or consolidate with any
other Person, or permit any other Person to merge into or consolidate with
it, or liquidate or dissolve (other than the mergers contemplated by the
Merger Agreements that shall be effected as of the Effective Date), except
that, if at the time thereof and immediately after giving effect thereto
no Default shall have occurred and be continuing:
(i) any Subsidiary of the Borrower may merge into the Borrower
in a transaction in which the Borrower is the surviving corporation;
(ii) any Subsidiary of the Borrower may merge into any other
Subsidiary of the Borrower in a transaction in which the surviving
entity is a Subsidiary Guarantor;
(iii) any Foreign Subsidiary of the Borrower may merge into
any other Foreign Subsidiary of the Borrower; and
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(iv) any Subsidiary of the Borrower may liquidate or dissolve
if the Borrower determines in good faith that such liquidation or
dissolution is in the best interests of the Borrower and is not
materially disadvantageous to the Lenders (and the Borrower shall
give prompt written notice of such liquidation or dissolution to the
Administrative Agent).
(b) Dispositions. The Borrower will not, nor will it permit any of
its Subsidiaries to, convey, sell, lease, transfer or otherwise dispose of
any part of its business or property, whether now owned or hereafter
acquired including receivables and leasehold interests, except:
(i) the disposition of any inventory or other property in the
ordinary course of business and on ordinary business terms;
(ii) the disposition of obsolete or worn-out property, tools
or equipment no longer used or useful in its business so long as the
amount thereof sold in any fiscal year by the Borrower and its
Subsidiaries shall not have an aggregate fair market value in excess
of $1,000,000;
(iii) any Subsidiary of the Borrower may sell, transfer, lease
or otherwise dispose of its assets to the Borrower or to another
Subsidiary, provided that the aggregate fair market value of assets
that may be so sold, transferred, leased or disposed of to
Subsidiaries that are not Subsidiary Guarantors shall not exceed
$5,000,000; and
(iv) the conveyance, sale, lease, transfer of other
disposition of assets by the Borrower or any of its Subsidiaries
(other than to any Subsidiaries that are not Subsidiary Guarantors)
not exceeding an aggregate fair market value of $15,000,000 in the
fiscal year ending December 31, 1999 and $5,000,000 in any fiscal
year thereafter; provided that the proceeds from any such
conveyance, sale, lease, transfer or other disposition are used to
prepay the Loans to the extent required by Section 2.10(b)(v).
(c) Acquisitions. The Borrower will not, nor will it permit any of
its Subsidiaries to, acquire any business or property from, or capital
stock of, or be a party to any acquisition of, any Person, or acquire any
option to make any such acquisition, except:
(i) purchases of inventory and other property to be sold or
used in the ordinary course of business;
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(ii) Investments permitted under Section 7.04;
(iii) Capital Expenditures;
(iv) acquisitions by the Borrower or any Subsidiary Guarantor
of assets from any other Subsidiary, or acquisitions by any Foreign
Subsidiary of assets from any other Foreign Subsidiary;
(v) the consummation of the Acquisition and the other
transaction contemplated by the Acquisition Documents;
(vi) acquisitions by the Borrower or any Subsidiary Guarantor
of assets from any Person (other than the Borrower or any
Subsidiary) not exceeding $10,000,000 in the aggregate (excluding
any assets purchased with any Indebtedness permitted under Section
7.01(d)); and
(vii) (in addition any acquisition permitted under the
foregoing clauses) other acquisitions by the Borrower or any of its
Subsidiaries not exceeding $1,000,000 in the aggregate.
(d) Lines of Business. The Borrower will not, nor will it permit any
of its Subsidiaries to, engage to any material extent in any business
other than businesses of the type conducted by the Borrower and its
Subsidiaries on the date of execution of this Agreement and businesses
reasonably related thereto.
SECTION 7.04. Investments. The Borrower will not, nor will it permit
any of its Subsidiaries to, make or permit to remain outstanding any Investments
except:
(a) Investments outstanding on the date hereof and identified in
Part B of Schedule VI;
(b) operating deposit accounts with banks;
(c) Permitted Investments;
(d) (i) Investments by the Borrower or any of its Subsidiaries in
the Borrower and its Subsidiaries on the date hereof, and (ii) additional
Investments in the Subsidiaries after the date hereof, provided that the
aggregate amount of such additional Investments in Subsidiaries that are
not Subsidiary Guarantors shall not exceed (A) $5,000,000 in any fiscal
year or (B) $30,000,000 in the aggregate, and provided further that if the
aggregate
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amount of such Investments for any fiscal year shall be less than
$5,000,000 the unused amount may be carried forward and invested in such
Investments in any succeeding fiscal year (subject to the limitations in
subclause (B) above);
(e) Hedging Agreements (including, without limitation, the Hedging
Agreements required by Section 6.09) entered into in the ordinary course
of the Borrower's financial planning and not for speculative purposes;
(f) Investments consisting of security deposits with utilities and
other like Persons made in the ordinary course of business;
(g) the consummation of the Acquisition and the other transactions
contemplated by the Acquisition Documents;
(h) Indebtedness permitted under Section 7.01; and
(i) additional Investments up to but not exceeding $5,000,000 in the
aggregate.
For purposes of clause (i) of this Section, the aggregate amount of an
Investment at any time shall be deemed to be equal to (A) the aggregate amount
of cash, together with the aggregate fair market value of property, loaned,
advanced, contributed, transferred or otherwise invested that gives rise to such
Investment minus (B) the aggregate amount of dividends, distributions or other
payments received in cash in respect of such Investment; the amount of an
Investment shall not in any event be reduced by reason of any write-off of such
Investment nor increased by any increase in the amount of earnings retained in
the Person in which such Investment is made that have not been dividended,
distributed or otherwise paid out.
SECTION 7.05. Restricted Payments. The Borrower will not, nor will
it permit any of its Subsidiaries to, declare or make, or agree to pay or make,
directly or indirectly, any Restricted Payment, except that:
(a) the Borrower may declare and pay dividends with respect to its
capital stock payable solely in additional shares of its common stock;
(b) the Borrower or any of its Subsidiaries may make the Restricted
Payments contemplated by the Acquisition Documents;
(c) the Borrower may purchase shares of its common stock for
purposes of making contributions to the Borrower's employee benefits plan
or in connection with its
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employee stock option plans, provided that the aggregate amount of such
purchases shall not exceed $5,000,000 in any fiscal year; and
(d) if at the time thereof and immediately after giving effect
thereto no Event of Default shall have occurred and be continuing, the
Borrower may declare and pay cash dividends with respect to its capital
stock not exceeding $7,200,000 in any fiscal year.
Nothing herein shall be deemed to prohibit the payment of dividends by any
Subsidiary of the Borrower to the Borrower or to any other Subsidiary of the
Borrower.
SECTION 7.06. Transactions with Affiliates. The Borrower will not,
nor will it permit any of its Subsidiaries to, sell, lease or otherwise transfer
any property or assets to, or purchase, lease or otherwise acquire any property
or assets from, or otherwise engage in any other transactions with, any of its
Affiliates, except:
(a) transactions in the ordinary course of business at prices and on
terms and conditions not less favorable to the Borrower or such Subsidiary
than could be obtained on an arm's-length basis from unrelated third
parties;
(b) transactions between or among the Borrower and its Subsidiaries
that are Subsidiary Guarantors not involving any other Affiliate;
(c) any Restricted Payment permitted by Section 7.05; and
(d) the transactions contemplated by the Acquisition Documents.
SECTION 7.07. Restrictive Agreements. The Borrower will not, nor
will it permit any of its Subsidiaries to, directly or indirectly, enter into,
incur or permit to exist any agreement or other arrangement that prohibits,
restricts or imposes any condition upon (a) the ability of the Borrower or any
Subsidiary to create, incur or permit to exist any Lien upon any of its property
or assets, or (b) the ability of any Subsidiary to pay dividends or other
distributions with respect to any shares of its capital stock or to make or
repay loans or advances to the Borrower or any other Subsidiary or to Guarantee
Indebtedness of the Borrower or any other Subsidiary; provided that:
(i) the foregoing shall not apply to (w) restrictions and
conditions imposed by law or by this Agreement, (x) restrictions and
conditions existing on the date hereof under the Senior Secured Notes
Indenture as then in effect, (y) other restrictions and conditions
existing on the date hereof identified on Schedule III (but shall apply to
any extension or renewal of, or any amendment or modification expanding
the scope of,
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any such restriction or condition) and (z) customary restrictions and
conditions contained in agreements relating to the sale of a Subsidiary
pending such sale, provided such restrictions and conditions apply only to
the Subsidiary that is to be sold and such sale is permitted hereunder;
and
(ii) clause (a) of the foregoing shall not apply to (x)
restrictions or conditions imposed by any agreement relating to secured
Indebtedness permitted by this Agreement if such restrictions or
conditions apply only to the property or assets securing such Indebtedness
and (y) customary provisions in leases and other contracts restricting the
assignment thereof.
SECTION 7.08. Operating Leases. The Borrower will not nor will it
permit any of its Subsidiaries to, become or remain liable in any way, whether
directly or indirectly or by assignment or as a guarantor or other surety, for
the obligations of the lessee under any operating leases (other than
intercompany leases between the Borrower and its Subsidiaries), if the aggregate
amount of all rents paid by the Borrower and its Subsidiaries under all such
operating leases would exceed $7,500,000 in any fiscal year.
SECTION 7.09. Certain Financial Covenants.
(a) Leverage Ratio. The Borrower will not permit the Leverage Ratio
to exceed the following respective ratios at any time during the following
respective periods:
Period Ratio
------ -----
From June 30, 1999 through 4.25:1.0
December 31, 1999
From January 1, 2000 through 3.75:1.0
December 31, 2000
From January 1, 2001 through 3.25:1.0
December 31, 2001
From January 1, 2002 through 2.75:1.0
December 31, 2002
From January 1, 2003 and 2.50:1.0
thereafter
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(b) Interest Coverage Ratio. The Borrower will not permit the
Interest Coverage Ratio to be less than the following respective ratios as at
the last day of any fiscal quarter ending during the following respective
periods:
Period Ratio
------ -----
From June 30, 1999 through 2.25:1.0
December 31, 1999
From January 1, 2000 through 2.75:1.0
December 31, 2000
From January 1, 2001 through 3.00:1.0
December 31, 2001
From January 1, 2002 through 3.25:1.0
December 31, 2002
From January 1, 2003 through 3.50:1.0
December 31, 2003
From January 1, 2004 through 3.75:1.0
December 31, 2005
From January 1, 2006 and 4.00:1.0
thereafter
(c) Fixed Charge Coverage Ratio. The Borrower will not permit the
Fixed Charge Coverage Ratio to be less than 1.25:1.0.
(d) Net Worth. The Borrower will not permit its Net Worth to be less
than the sum of (a) $60,000,000 plus (b) 50% of net income (if positive) of the
Borrower and its Subsidiaries (determined on a consolidated basis in accordance
with GAAP) for each fiscal quarter commencing with the fiscal quarter ending
June 30, 1999.
SECTION 7.10. Modifications of Certain Documents; Payment of Senior
Secured Notes.
(a) The Borrower will not consent to any modification, supplement or
waiver of any of the provisions of any agreement, instrument or other document
evidencing or relating to
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(i) the charter or by-laws of the Borrower or any of its Subsidiaries, (ii) the
Senior Secured Notes or the Senior Secured Notes Indenture (other than the
amendments contemplated in the Offer to Purchase), (iii) the Acquisition
Documents, (iv) the Offer to Purchase or (v) any material lease, in each case
without the prior consent of the Administrative Agent (with the approval of the
Required Lenders).
(b) The Borrower will not, nor will it permit any of its
Subsidiaries to, purchase, redeem, retire or otherwise acquire for value, or set
apart any money for a sinking, defeasance or analogous fund for the purchase,
redemption, retirement or other acquisition of, or make any payment or
prepayment of the principal of or interest on, or any other amount owing in
respect of, the Senior Secured Notes, except for: (i) regularly scheduled
payments of principal of or interest on the Senior Secured Notes in accordance
with the terms thereof and of the Senior Secured Notes Indenture, each as in
effect on the Effective Date; (ii) the payments in respect of the consummation
of the Bond Tender Offer; and (iii) the redemption of the Senior Secured Notes
required by Section 6.11(b).
SECTION 7.11. Sale and Leaseback. The Borrower will not, nor will
it permit any of its Subsidiaries to, enter into any arrangement with any other
Person providing for the leasing by the Borrower or any of its Subsidiaries of
real or personal property that has been or is to be sold or transferred by the
Borrower or any of its Subsidiaries to such other Person or to any other Person
to whom funds have been or are to be advanced by such Person on the security of
such property or rental obligations of the Borrower or any of its Subsidiaries,
other than such transactions not exceeding an aggregate sale price of
$5,000,000.
SECTION 7.12. Fiscal Year. The Borrower will not, nor will it permit
any of its Subsidiaries to, change its fiscal year from a calendar year ending
December 31.
ARTICLE VIII
EVENTS OF DEFAULT
If any of the following events ("Events of Default") shall occur:
(a) the Borrower shall fail to pay any principal of any Loan or any
reimbursement obligation in respect of any LC Disbursement when and as the
same shall become due and payable, whether at the due date thereof or at a
date fixed for prepayment thereof or otherwise;
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(b) the Borrower shall fail to pay any interest on any Loan or any
fee or any other amount (other than an amount referred to in clause (a) of
this Article) payable under this Agreement or under any other Credit
Document, when and as the same shall become due and payable, and such
failure shall continue unremedied for a period of three or more Business
Days;
(c) any representation or warranty made or deemed made by or on
behalf of the Borrower or any of its Subsidiaries in or in connection with
this Agreement or any other Credit Document or any amendment or
modification hereof or thereof, or in any report, certificate, financial
statement or other document furnished pursuant to or in connection with
this Agreement or any other Credit Document or any amendment or
modification hereof or thereof, shall prove to have been incorrect when
made or deemed made in any material respect; or any representation or
warranty made by the Borrower, any of its Subsidiaries, MVE Holdings or
MVE Investors under the respective Merger Agreements shall prove to have
been incorrect when made in any material respect;
(d) the Borrower shall fail to observe or perform any covenant,
condition or agreement contained in Section 6.02(a), 6.03 (with respect to
the Borrower's existence), 6.08 or 6.10 or in Article VII or any Obligor
shall default in the performance of any of its obligations contained in
Section 4.02 or 5.02 of the Security Agreement or any provisions of the
Mortgages;
(e) any Obligor shall fail to observe or perform any covenant,
condition or agreement contained in this Agreement (other than those
specified in clause (a), (b) or (d) of this Article) or any other Credit
Document and such failure shall continue unremedied for a period of 30 or
more days after notice thereof from the Administrative Agent (given at the
request of any Lender) to the Borrower;
(f) the Borrower or any of its Subsidiaries shall fail to make any
payment (whether of principal or interest and regardless of amount) in
respect of any Indebtedness (other than Indebtedness hereunder and under
the other Credit Documents) aggregating $5,000,000 or more, or any payment
of any amount under Hedging Agreements for an aggregate notional principal
amount exceeding $5,000,000, in each case when and as the same shall
become due and payable;
(g) any event or condition occurs that results in any Indebtedness
(other than Indebtedness hereunder and under the other Credit Documents)
aggregating $5,000,000 or more becoming due prior to its scheduled
maturity or that enables or permits (with or without the giving of notice,
the lapse of time or both) the holder or holders of any such Indebtedness
or any trustee or agent on its or their behalf to cause any such
Indebtedness
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to become due, or to require the prepayment, repurchase, redemption or
defeasance thereof, prior to its scheduled maturity;
(h) an involuntary proceeding shall be commenced or an involuntary
petition shall be filed seeking (i) liquidation, reorganization or other
relief in respect of the Borrower or any of its Subsidiaries or its debts,
or of a substantial part of its assets, under any Federal, state or
foreign bankruptcy, insolvency, receivership or similar law now or
hereafter in effect or (ii) the appointment of a receiver, trustee,
custodian, sequestrator, conservator or similar official for the Borrower
or any of its Subsidiaries or for a substantial part of its assets, and,
in any such case, such proceeding or petition shall continue undismissed
for a period of 60 or more days or an order or decree approving or
ordering any of the foregoing shall be entered;
(i) the Borrower or any of its Subsidiaries shall (i) voluntarily
commence any proceeding or file any petition seeking liquidation,
reorganization or other relief under any Federal, state or foreign
bankruptcy, insolvency, receivership or similar law now or hereafter in
effect, (ii) consent to the institution of, or fail to contest in a timely
and appropriate manner, any proceeding or petition described in clause (h)
of this Article, (iii) apply for or consent to the appointment of a
receiver, trustee, custodian, sequestrator, conservator or similar
official for the Borrower or any of its Subsidiaries or for a substantial
part of its assets, (iv) file an answer admitting the material allegations
of a petition filed against it in any such proceeding, (v) make a general
assignment for the benefit of creditors or (vi) take any action for the
purpose of effecting any of the foregoing;
(j) the Borrower or any of its Subsidiaries shall become unable,
admit in writing its inability or fail generally to pay its debts as they
become due;
(k) one or more judgments for the payment of money in an aggregate
amount in excess of $10,000,000 shall be rendered against the Borrower or
any of its Subsidiaries or any combination thereof and the same shall
remain undischarged for a period of 30 consecutive days during which
execution shall not be effectively stayed, or any action shall be legally
taken by a judgment creditor to attach or levy upon any assets of the
Borrower or any of its Subsidiaries to enforce any such judgment;
(l) an ERISA Event shall have occurred that, in the opinion of the
Required Lenders, when taken together with all other ERISA Events that
have occurred, could reasonably be expected to result in liability of the
Borrower and its Subsidiaries in an aggregate amount exceeding
$10,000,000;
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(m) there shall have been asserted against the Borrower or any of
its Subsidiaries an Environmental Claim that, in the judgment of the
Required Lenders, is reasonably likely to be determined adversely to the
Borrower or any of its Subsidiaries, and the amount thereof (either
individually or in the aggregate) is reasonably likely to result in
liability of the Borrower and its Subsidiaries in an aggregate amount
exceeding $10,000,000 (insofar as such amount is payable by the Borrower
or any of its Subsidiaries but after deducting any portion thereof that is
reasonably expected to be paid by other creditworthy Persons jointly and
severally liable therefor);
(n) a Change in Control shall occur;
(o) any Subsidiary of the Borrower shall cease to be a Wholly Owned
Subsidiary (except as (i) a result of any transactions expressly permitted
under Article VII or (ii) otherwise permitted under Section 6.10(b)); or
(p) other than in connection with any termination of any Lien
permitted hereunder or any of the Security Documents, the Liens created by
the Security Documents shall at any time not constitute a valid and
perfected Lien on the collateral intended to be covered thereby (to the
extent perfection by filing, registration, recordation or possession is
required herein or therein) in favor of the Administrative Agent, free and
clear of all other Liens (other than Liens permitted under Section 7.02 or
under the respective Security Documents), or, except for expiration or
termination in accordance with its terms, any of the Security Documents
shall for whatever reason be terminated or cease to be in full force and
effect, or the enforceability thereof shall be contested in writing by any
Obligor;
then, and in every such event (other than an event with respect to any Obligor
described in clause (h) or (i) of this Article), and at any time thereafter
during the continuance of such event, the Administrative Agent may (in the case
of an event described in clause (a) or (b) of this Article) and shall at the
request of, or with the consent of the Required Lenders, by notice to the
Borrower, take either or both of the following actions, at the same or different
times: (i) terminate the Commitments, and thereupon the Commitments shall
terminate immediately, and (ii) declare the Loans then outstanding to be due and
payable in whole (or in part, in which case any principal not so declared to be
due and payable may thereafter be declared to be due and payable), and thereupon
the principal of the Loans so declared to be due and payable, together with
accrued interest thereon and all fees and other obligations of the Obligors
accrued hereunder, shall become due and payable immediately, without
presentment, demand, protest or other notice of any kind, all of which are
hereby waived by each Obligor; provided that in case of any event with respect
to any Obligor described in clause (h) or (i) of this Article, the Commitments
shall automatically terminate and the principal of the Loans then outstanding,
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together with accrued interest thereon and all fees and other obligations of the
Obligors accrued hereunder, shall automatically become due and payable, without
presentment, demand, protest or other notice of any kind, all of which are
hereby waived by each Obligor.
Anything herein to the contrary notwithstanding, it is understood
that (i) no Lender has the right to individually terminate its Commitments (such
right of termination residing with the Administrative Agent as provided above),
(ii) no Lender has the right to declare its Loans due and payable (such right to
declare the Loans due and payable residing with the Administrative Agent as
provided above, subject to the proviso set forth above in the case of an Event
of Default under clause (h) or (i) of this Article), and (iii) no Lender has the
right to exercise any remedies under the Security Agreement (such right to
exercise remedies residing with the Administrative Agent as provided therein).
ARTICLE IX
THE ADMINISTRATIVE AGENT
Each of the Lenders and the Issuing Lenders hereby irrevocably
appoints the Administrative Agent as its agent hereunder and under the other
Credit Documents and authorizes the Administrative Agent to take such actions on
its behalf and to exercise such powers as are delegated to the Administrative
Agent by the terms hereof or thereof, together with such actions and powers as
are reasonably incidental thereto.
The Person serving as the Administrative Agent hereunder shall have
the same rights and powers in its capacity as a Lender as any other Lender and
may exercise the same as though it were not the Administrative Agent, and such
Person and its Affiliates may accept deposits from, lend money to and generally
engage in any kind of business with the Borrower or any Subsidiary or other
Affiliate thereof as if it were not the Administrative Agent hereunder.
The Administrative Agent shall not have any duties or obligations
except those expressly set forth herein and in the other Credit Documents.
Without limiting the generality of the foregoing, (a) the Administrative Agent
shall not be subject to any fiduciary or other implied duties, regardless of
whether a Default has occurred and is continuing, (b) the Administrative Agent
shall not have any duty to take any discretionary action or exercise any
discretionary powers, except discretionary rights and powers expressly
contemplated hereby or by the other Credit Documents that the Administrative
Agent is required to exercise in writing by the Required Lenders, and (c) except
as expressly set forth herein and in the other Credit Documents, the
Administrative Agent shall not have any duty to disclose, and shall not be
liable for the failure to disclose, any information relating to the Borrower or
any of its Subsidiaries that
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is communicated to or obtained by the bank serving as Administrative Agent or
any of its Affiliates in any capacity. The Administrative Agent shall not be
liable for any action taken or not taken by it with the consent or at the
request of the Required Lenders or in the absence of its own gross negligence or
willful misconduct. The Administrative Agent shall be deemed not to have
knowledge of any Default unless and until written notice thereof is given to the
Administrative Agent by the Borrower or a Lender, and the Administrative Agent
shall not be responsible for or have any duty to ascertain or inquire into (i)
any statement, warranty or representation made in or in connection with this
Agreement or any other Credit Document, (ii) the contents of any certificate,
report or other document delivered hereunder or thereunder or in connection
herewith or therewith, (iii) the performance or observance of any of the
covenants, agreements or other terms or conditions set forth herein or therein,
(iv) the validity, enforceability, effectiveness or genuineness of this
Agreement, any other Credit Document or any other agreement, instrument or
document, or (v) the satisfaction of any condition set forth in Article V or
elsewhere herein or therein, other than to confirm receipt of items expressly
required to be delivered to the Administrative Agent.
The Administrative Agent shall be entitled to rely upon, and shall
not incur any liability for relying upon, any notice, request, certificate,
consent, statement, instrument, document or other writing believed by it to be
genuine and to have been signed or sent by the proper Person. The Administrative
Agent also may rely upon any statement made to it orally or by telephone and
believed by it to be made by the proper Person, and shall not incur any
liability for relying thereon. The Administrative Agent may consult with legal
counsel (who may be counsel for an Obligor), independent accountants and other
experts selected by it, and shall not be liable for any action taken or not
taken by it in accordance with the advice of any such counsel, accountants or
experts.
The Administrative Agent may perform any and all its duties and
exercise its rights and powers by or through any one or more sub-agents
appointed by the Administrative Agent (including, without limitation, under any
Security Document). The Administrative Agent and any such sub-agent may perform
any and all its duties and exercise its rights and powers through their
respective Related Parties. The exculpatory provisions of the preceding
paragraphs shall apply to any such sub-agent and to the Related Parties of the
Administrative Agent and any such sub-agent, and shall apply to their respective
activities in connection with the syndication of the credit facilities provided
for herein as well as activities as Administrative Agent. Each Lender by its
execution and delivery of this Agreement agrees, as contemplated by Section 4.04
of the Security Agreement, that, in the event it shall hold any Permitted
Investments referred to therein, such Permitted Investments shall be held in the
name and under the control of such Lender, and such Lender shall hold such
Permitted Investments as a collateral sub-agent for the Administrative Agent
thereunder. Each Obligor by its execution and delivery of this Agreement hereby
consents to the foregoing.
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The Administrative Agent may resign at any time by notifying the
Lenders, the Issuing Lenders and the Borrower. Upon any such resignation, the
Required Lenders shall have the right, in consultation with the Borrower, to
appoint a successor. If no successor shall have been so appointed by the
Required Lenders and shall have accepted such appointment within 30 days after
the retiring Administrative Agent gives notice of its resignation, then the
retiring Administrative Agent's resignation shall nonetheless become effective
and (i) the retiring Administrative Agent shall be discharged from its duties
and obligations hereunder and (ii) the Required Lenders shall perform the duties
of the Administrative Agent (and all payments and communications provided to be
made by, to or through the Administrative Agent shall instead be made by or to
each Lender directly) until such time as the Required Lenders appoint a
successor agent as provided for above in this paragraph. Upon the acceptance of
its appointment as Administrative Agent hereunder by a successor, such successor
shall succeed to and become vested with all the rights, powers, privileges and
duties of the retiring (or retired) Administrative Agent and the retiring
Administrative Agent shall be discharged from its duties and obligations
hereunder (if not already discharged therefrom as provided above in this
paragraph). The fees payable by the Borrower to a successor Administrative Agent
shall be the same as those payable to its predecessor unless otherwise agreed
between the Borrower and such successor. After the Administrative Agent's
resignation hereunder, the provisions of this Article and Section 10.03 shall
continue in effect for its benefit in respect of any actions taken or omitted to
be taken by it while it was acting as Administrative Agent.
Each Lender acknowledges that it has, independently and without
reliance upon the Administrative Agent or any other Lender and based on such
documents and information as it has deemed appropriate, made its own credit
analysis and decision to enter into this Agreement. Each Lender also
acknowledges that it will, independently and without reliance upon the
Administrative Agent or any other Lender and based on such documents and
information as it shall from time to time deem appropriate, continue to make its
own decisions in taking or not taking action under or based upon this Agreement,
any other Credit Document or any related agreement or any document furnished
hereunder or thereunder.
Notwithstanding anything herein to the contrary, the Lead Arranger
and Book Manager named on the cover page of this Agreement and the Documentation
Agent shall not have any duties or liabilities under this Agreement or the other
Credit Documents.
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ARTICLE X
MISCELLANEOUS
SECTION 10.01. Notices. Except in the case of notices and other
communications expressly permitted to be given by telephone, all notices and
other communications provided for herein shall be in writing and shall be
delivered by hand or overnight courier service, mailed by certified or
registered mail or sent by telecopy, as follows:
(a) if to the Borrower or any Subsidiary Guarantor, to the Borrower
at Chart Industries, Inc., 5885 Landerbrook Drive, Suite 150, Mayfield
Heights, Ohio 44124, Attention of Don A. Baines (Telecopy No. (440)
753-1491; Telephone No. (440) 753-1490);
(b) if to the Administrative Agent, to The Chase Manhattan Bank, 1
Chase Manhattan Plaza, 8th Floor, New York, New York 10081, Attention of
Mo-Lin Sum, Loan and Agency Services Group (Telecopy No. (212) 552-5650;
Telephone No. (212) 552-7312), with a copy to The Chase Manhattan Bank,
2300 Main Place Tower, Buffalo, New York 14202, Attention of Jennifer Pegg
(Telecopy No. (716) 843-4938; Telephone No. (716) 858-1435);
(c) if to the Swingline Lender, to The Chase Manhattan Bank, 1 Chase
Manhattan Plaza, 8th Floor, New York, New York 10081, Attention of Mo-Lin
Sum, Loan and Agency Services Group (Telecopy No. (212) 552-5650;
Telephone No. (212) 552-7312);
(d) if to an Issuing Lender, to it at its address specified in
writing to the Borrower and the Administrative Agent;
(e) if to the Foreign Currency Lender, to it at its address
specified in writing to the Borrower and the Administrative Agent; and
(f) if to a Lender, to it at its address (or telecopy number) set
forth in its Administrative Questionnaire.
Any party hereto may change its address or telecopy number for notices and other
communications hereunder by notice to the other parties hereto (or, in the case
of any such change by a Lender, by notice to the Borrower and the Administrative
Agent). All notices and other communications given to any party hereto in
accordance with the provisions of this Agreement shall be deemed to have been
given on the date of receipt.
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SECTION 10.02. Waivers; Amendments.
(a) No Deemed Waivers; Remedies Cumulative. No failure or delay by
the Administrative Agent, any Issuing Lender or any Lender in exercising any
right or power hereunder shall operate as a waiver thereof, nor shall any single
or partial exercise of any such right or power, or any abandonment or
discontinuance of steps to enforce such a right or power, preclude any other or
further exercise thereof or the exercise of any other right or power. The rights
and remedies of the Administrative Agent, the Issuing Lenders and the Lenders
hereunder are cumulative and are not exclusive of any rights or remedies that
they would otherwise have. No waiver of any provision of this Agreement or
consent to any departure by any Obligor therefrom shall in any event be
effective unless the same shall be permitted by paragraph (b) of this Section,
and then such waiver or consent shall be effective only in the specific instance
and for the purpose for which given. Without limiting the generality of the
foregoing, the making of a Loan or issuance of a Letter of Credit shall not be
construed as a waiver of any Default, regardless of whether the Administrative
Agent, any Lender or any Issuing Lender may have had notice or knowledge of such
Default at the time.
(b) Amendments to this Agreement. Neither this Agreement nor any
provision hereof may be waived, amended or modified except pursuant to an
agreement or agreements in writing entered into by the Borrower and the Required
Lenders or by the Borrower and the Administrative Agent with the consent of the
Required Lenders; provided that no such agreement shall:
(i) increase any Commitment of any Lender without the written
consent of such Lender;
(ii) reduce or forgive the principal amount of any Loan or LC
Disbursement or reduce the rate of interest thereon, or reduce or forgive
any fees payable hereunder, without the written consent of each Lender
affected thereby;
(iii) postpone the scheduled date of payment of the principal amount
of any Loan or LC Disbursement, or any interest thereon, or any fees
payable hereunder, or reduce the amount of, waive or excuse any such
payment, or postpone the scheduled date of expiration of any Commitment,
without the written consent of each Lender affected thereby;
(iv) alter the manner in which payments or prepayments of principal,
interest or other amounts hereunder shall be applied as among the Lenders
or Types or Classes of Loans, without the written consent of each Lender
affected thereby;
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(v) change any of the provisions of this Section or the definition
of the term "Required Lenders" or any other provision hereof specifying
the number or percentage of Lenders required to waive, amend or modify any
rights hereunder or make any determination or grant any consent hereunder,
without the written consent of each Lender; or
(vi) release any Guarantor from any of its guarantee obligations
under Article III or any Security Document, without the written consent of
each Lender (except that no such consent shall be required, and the
Administrative Agent is hereby authorized, to release any Guarantor from
such obligations that is the subject of a disposition or other transaction
which is permitted hereunder or to which the Required Lenders have
consented).
and provided further that (x) no such agreement shall amend, modify or otherwise
affect the rights or duties of the Administrative Agent, any Issuing Lender, the
Swingline Lender or the Foreign Currency Lender hereunder without the prior
written consent of the Administrative Agent, the affected Issuing Lender, the
Swingline Lender or the Foreign Currency Lender, as the case may be, and (y)
that any modification or supplement of Article III shall require the consent of
each Guarantor.
Anything in this Agreement to the contrary, no waiver or
modification of any provision of this Agreement that has the effect (either
immediately or at a later time) of (i) enabling the Borrower to satisfy a
condition precedent to the making of a Loan of any Class shall be effective
against the Lenders of such Class, unless the Required Lenders of such Class
(whichever Class is so affected) shall have concurred with such waiver on
modification or (ii) waiving or modifying any of the requirements of Section
5.03, or altering the conditions to the application of the proceeds of the Term
Loans to the consummation of the Bond Tender Offer, unless the Required Lenders
of each Class of Term Loans shall have concurred with such waiver or
modification.
(c) Amendments to Other Credit Documents. Except as otherwise
provided in Section 10.02(b) with respect to this Agreement, the Administrative
Agent may, with the prior consent of the Required Lenders (but not otherwise),
consent to any modification, supplement or waiver under any of the Credit
Documents, provided that, without the prior consent of each Lender, the
Administrative Agent shall not (except as provided herein or in the Security
Documents) (i) release all or substantially all of the collateral under the
Security Documents or otherwise terminate the Liens with respect to such
collateral, (ii) agree to additional obligations (other than obligations of the
type secured under the Security Documents) being secured by such collateral
security (unless the Lien for such additional obligations shall be junior to the
Lien securing the obligations secured by such Security Document, in which event
the Administrative
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Agent may consent to such junior Lien and enter into appropriate intercreditor
arrangements provided that it obtains the consent of the Required Lenders
thereto) or (iii) alter the relative priorities of the obligations entitled to
the benefits of the Liens created under the Security Documents, except that no
such consent shall be required, and the Administrative Agent is hereby
authorized, to release any Lien covering property that is the subject of either
a disposition of property permitted hereunder or a disposition to which the
Required Lenders have consented; provided that no such agreement shall amend,
modify or otherwise affect the rights and duties of the Administrative Agent
thereunder without the prior written consent of the Administrative Agent.
SECTION 10.03. Expenses; Indemnity; Damage Waiver.
(a) Costs and Expenses. The Borrower shall pay (i) all reasonable
out-of-pocket expenses incurred by the Administrative Agent and its Affiliates,
including the reasonable fees, charges and disbursements of counsel for the
Administrative Agent, in connection with the syndication of the credit
facilities provided for herein, the preparation and administration of this
Agreement and the other Credit Documents or any amendments, modifications or
waivers of the provisions hereof or thereof (whether or not the transactions
contemplated hereby or thereby shall be consummated), (ii) all out-of-pocket
expenses incurred by each Issuing Lender in connection with the issuance,
amendment, renewal or extension of any Letter of Credit or any demand for
payment thereunder, (iii) all out-of-pocket expenses incurred by the
Administrative Agent, any Issuing Lender or any Lender, including the fees,
charges and disbursements of any counsel for the Administrative Agent, any
Issuing Lender or any Lender, in connection with the enforcement or protection
of its rights in connection with this Agreement and the other Credit Documents,
including its rights under this Section, or in connection with the Loans made or
Letters of Credit issued hereunder, including in connection with any workout,
restructuring or negotiations in respect thereof and (iv) and all costs,
expenses, taxes, assessments and other charges incurred in connection with any
filing, registration, recording or perfection of any security interest
contemplated by any Security Document or any other document referred to therein.
(b) Indemnification by the Borrower. The Borrower shall indemnify
the Administrative Agent, each Issuing Lender and each Lender, and each Related
Party of any of the foregoing Persons (each such Person being called an
"Indemnitee") against, and to hold each Indemnitee harmless from, any and all
losses, claims, damages, liabilities and related expenses, including the fees,
charges and disbursements of any counsel for any Indemnitee, incurred by or
asserted against any Indemnitee arising out of, in connection with, or as a
result of (i) the execution or delivery of this Agreement or any agreement or
instrument contemplated hereby, the performance by the parties hereto of their
respective obligations hereunder or the consummation of the Transactions or any
other transactions contemplated hereby, (ii) any Loan
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or Letter of Credit or the use of the proceeds therefrom (including any refusal
by the relevant Issuing Lender to honor a demand for payment under a Letter of
Credit if the documents presented in connection with such demand do not strictly
comply with the terms of such Letter of Credit) or any payments that the
Administrative Agent is required to make under any indemnity issued to any bank
referred to in Section 4.02(b) of the Security Agreement to which remittances in
respect of Accounts, as defined therein, are to be made, (iii) any actual or
alleged presence, release or threatened release of Hazardous Materials relating
to any property owned or operated by the Borrower or any of its Subsidiaries, or
any Environmental Liability related in any way to the Borrower or any of its
Subsidiaries, or (iv) any actual or prospective claim, litigation, investigation
or proceeding relating to any of the foregoing, whether based on contract, tort
or any other theory and regardless of whether any Indemnitee is a party thereto;
provided that such indemnity shall not, as to any Indemnitee, be available to
the extent that such losses, claims, damages, liabilities or related expenses
are determined by a court of competent jurisdiction by final and nonappealable
judgment to have resulted from the gross negligence or willful misconduct of
such Indemnitee.
(c) Reimbursement by Lenders. To the extent that the Borrower fails
to pay any amount required to be paid by it to the Administrative Agent, any
Issuing Lender, the Swingline Lender or the Foreign Currency Lender under
paragraph (a) or (b) of this Section, each Lender severally agrees to pay to the
Administrative Agent, such Issuing Lender, the Swingline Lender or the Foreign
Currency Lender, as the case may be, such Lender's Applicable Percentage
(determined as of the time that the applicable unreimbursed expense or indemnity
payment is sought) of such unpaid amount; provided that the unreimbursed expense
or indemnified loss, claim, damage, liability or related expense, as the case
may be, was incurred by or asserted against the Administrative Agent, such
Issuing Lender, the Swingline Lender or the Foreign Currency Lender in its
capacity as such, and provided further that such indemnity shall not be
available to the Administrative Agent, such Issuing Lender, the Swingline Lender
or the Foreign Currency Lender to the extent that such losses, claims, damages,
liabilities or related expenses are determined by a court of competent
jurisdiction by final and nonappealable judgment to have resulted from the gross
negligence or willful misconduct of the Administrative Agent, such Issuing
Lender, the Swingline Lender or the Foreign Currency Lender, as the case may be.
(d) Waiver of Consequential Damages, Etc. To the extent permitted by
applicable law, no Obligor shall assert, and each Obligor hereby waives, any
claim against any Indemnitee, on any theory of liability, for special, indirect,
consequential or punitive damages (as opposed to direct or actual damages)
arising out of, in connection with, or as a result of, this Agreement or any
agreement or instrument contemplated hereby, the Transactions, any Loan or
Letter of Credit or the use of the proceeds thereof.
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(e) Payments. All amounts due under this Section shall be payable
promptly after written demand therefor.
SECTION 10.04. Successors and Assigns.
(a) Assignments Generally. The provisions of this Agreement shall be
binding upon and inure to the benefit of the parties hereto and their respective
successors and assigns permitted hereby, except that no Obligor may assign or
otherwise transfer any of its rights or obligations hereunder without the prior
written consent of each Lender (and any attempted assignment or transfer by any
Obligor without such consent shall be null and void). Nothing in this Agreement,
expressed or implied, shall be construed to confer upon any Person (other than
the parties hereto, their respective successors and assigns permitted hereby
and, to the extent expressly contemplated hereby, the Related Parties of each of
the Administrative Agent, the Issuing Lenders and the Lenders) any legal or
equitable right, remedy or claim under or by reason of this Agreement.
(b) Assignments by Lenders. Any Lender may assign to one or more
assignees all or a portion of its rights and obligations under this Agreement
(including all or a portion of its Commitments and the Loans at the time owing
to it); provided that (i) except in the case of an assignment by a Lender to
another Lender, an Affiliate of a Lender or an Approved Fund with respect to a
Lender or an Affiliate of a Lender, each of the Borrower and the Administrative
Agent (and, in the case of an assignment of all or a portion of a Commitment or
any Lender's obligations in respect of its LC Exposure, Swingline Exposure or
Foreign Currency Exposure, the Issuing Lenders, the Swingline Lender and the
Foreign Currency Lender) must give their prior written consent to such
assignment (which consent in each case shall not be unreasonably withheld), (ii)
except in the case of an assignment by a Lender to another Lender, an Affiliate
of a Lender or with respect to a Lender or an Affiliate of a Lender or an
assignment of the entire remaining amount of the assigning Lender's
Commitment(s), the amount of the Commitment(s) of the assigning Lender subject
to each such assignment (determined as of the date the Assignment and Acceptance
with respect to such assignment is delivered to the Administrative Agent) shall
not be less than $5,000,000 unless each of the Borrower and the Administrative
Agent otherwise consent, (iii) each partial assignment of any Class of
Commitment or Loans shall be made as an assignment of a proportionate part of
all the assigning Lender's rights and obligations of such Class of Commitment
and Loans under this Agreement, (iv) the parties to each assignment shall
execute and deliver to the Administrative Agent an Assignment and Acceptance,
together with a processing and recordation fee of $3,500, and (v) the assignee,
if it shall not be a Lender, shall deliver to the Administrative Agent an
Administrative Questionnaire; provided further that any consent of the Borrower
otherwise required under this paragraph shall not be required if an Event of
Default under clause (h) or (i) of Article VIII has occurred and is continuing.
Upon acceptance and recording pursuant to paragraph (d) of this Section, from
and
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after the effective date specified in each Assignment and Acceptance, the
assignee thereunder shall be a party hereto and, to the extent of the interest
assigned by such Assignment and Acceptance, have the rights and obligations of a
Lender under this Agreement, and the assigning Lender thereunder shall, to the
extent of the interest assigned by such Assignment and Acceptance, be released
from its obligations under this Agreement (and, in the case of an Assignment and
Acceptance covering all of the assigning Lender's rights and obligations under
this Agreement, such Lender shall cease to be a party hereto but shall continue
to be entitled to the benefits of Sections 2.14, 2.15, 2.16 and 10.03). Any
assignment or transfer by a Lender of rights or obligations under this Agreement
that does not comply with this paragraph shall be treated for purposes of this
Agreement as a sale by such Lender of a participation in such rights and
obligations in accordance with paragraph (e) of this Section.
(c) Maintenance of Register by the Administrative Agent. The
Administrative Agent, acting for this purpose as an agent of the Borrower, shall
maintain at one of its offices in New York City a copy of each Assignment and
Acceptance delivered to it and a register for the recordation of the names and
addresses of the Lenders, and the Commitments of, and principal amount of the
Loans and LC Disbursements owing to, each Lender pursuant to the terms hereof
from time to time (the "Register"). The entries in the Register shall be
conclusive, and the Borrower, the Administrative Agent, the Issuing Lenders and
the Lenders may treat each Person whose name is recorded in the Register
pursuant to the terms hereof as a Lender hereunder for all purposes of this
Agreement, notwithstanding notice to the contrary. The Register shall be
available for inspection by the Borrower, any Issuing Lender and any Lender, at
any reasonable time and from time to time upon reasonable prior notice.
(d) Effectiveness of Assignments. Upon its receipt of a duly
completed Assignment and Acceptance executed by an assigning Lender and an
assignee, the assignee's completed Administrative Questionnaire (unless the
assignee shall already be a Lender hereunder), the processing and recordation
fee referred to in paragraph (b) of this Section and any written consent to such
assignment required by paragraph (b) of this Section, the Administrative Agent
shall accept such Assignment and Acceptance and record the information contained
therein in the Register. No assignment shall be effective for purposes of this
Agreement unless it has been recorded in the Register as provided in this
paragraph.
(e) Participations. Any Lender may, without the consent of the
Borrower, the Administrative Agent, the Issuing Lenders, the Swingline Lender or
the Foreign Currency Lender, sell participations to one or more banks or other
entities (a "Participant") in all or a portion of such Lender's rights and
obligations under this Agreement and the other Credit Documents (including all
or a portion of its Commitments and the Loans owing to it); provided that (i)
such Lender's obligations under this Agreement and the other Credit Documents
shall remain unchanged, (ii) such Lender shall remain solely responsible to the
other parties hereto for
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the performance of such obligations and (iii) the Borrower, the Administrative
Agent, the Issuing Lenders and the other Lenders shall continue to deal solely
and directly with such Lender in connection with such Lender's rights and
obligations under this Agreement and the other Credit Documents. Any agreement
or instrument pursuant to which a Lender sells such a participation shall
provide that such Lender shall retain the sole right to enforce this Agreement
and the other Credit Documents and to approve any amendment, modification or
waiver of any provision of this Agreement or any other Credit Document; provided
that such agreement or instrument may provide that such Lender will not, without
the consent of the Participant, agree to any amendment, modification or waiver
described in the first proviso to Section 10.02(b) or described in the first
proviso to Section 10.02(c) that affects such Participant. Subject to paragraph
(f) of this Section, the Borrower agrees that each Participant shall be entitled
to the benefits of Sections 2.14, 2.15 and 2.16 to the same extent as if it were
a Lender and had acquired its interest by assignment pursuant to paragraph (b)
of this Section.
(f) Limitations on Rights of Participants. A Participant shall not
be entitled to receive any greater payment under Section 2.14 or 2.16 than the
applicable Lender would have been entitled to receive with respect to the
participation sold to such Participant, unless the sale of the participation to
such Participant is made with the Borrower's prior written consent. A
Participant that would be a Foreign Lender if it were a Lender shall not be
entitled to the benefits of Section 2.16 unless the Borrower is notified of the
participation sold to such Participant and such Participant agrees, for the
benefit of the Borrower, to comply with Section 2.16(e) as though it were a
Lender.
(g) Certain Pledges. Any Lender may at any time pledge or assign a
security interest in all or any portion of its rights under this Agreement to
secure obligations of such Lender, including any such pledge or assignment to a
Federal Reserve Bank, and this Section shall not apply to any such pledge or
assignment of a security interest; provided that no such pledge or assignment of
a security interest shall release a Lender from any of its obligations hereunder
or substitute any such assignee for such Lender as a party hereto.
(h) No Assignments to the Obligors or Affiliates. Anything in this
Section to the contrary notwithstanding, no Lender may assign or participate any
interest in any Loan or LC Exposure held by it hereunder to the Borrower or any
of its Affiliates or Subsidiaries without the prior consent of each Lender.
SECTION 10.05. Survival. All covenants, agreements, representations
and warranties made by the Borrower herein and in the certificates or other
instruments delivered in connection with or pursuant to this Agreement shall be
considered to have been relied upon by the other parties hereto and shall
survive the execution and delivery of this Agreement and the making of any Loans
and issuance of any Letters of Credit, regardless of any investigation made
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by any such other party or on its behalf and notwithstanding that the
Administrative Agent, any Issuing Lender or any Lender may have had notice or
knowledge of any Default or incorrect representation or warranty at the time any
credit is extended hereunder, and shall continue in full force and effect as
long as the principal of or any accrued interest on any Loan or any fee or any
other amount payable under this Agreement is outstanding and unpaid or any
Letter of Credit is outstanding and so long as the Commitments have not expired
or terminated. The provisions of Sections 2.14, 2.15, 2.16, 3.03 and 10.03 and
Article IX shall survive and remain in full force and effect regardless of the
consummation of the transactions contemplated hereby, the repayment of the
Loans, the expiration or termination of the Letters of Credit and the
Commitments or the termination of this Agreement or any provision hereof.
SECTION 10.06. Counterparts; Integration; Effectiveness. This
Agreement may be executed in counterparts (and by different parties hereto on
different counterparts), each of which shall constitute an original, but all of
which when taken together shall constitute a single contract. This Agreement and
any separate letter agreements with respect to fees payable to the
Administrative Agent constitute the entire contract between and among the
parties relating to the subject matter hereof and supersede any and all previous
agreements and understandings, oral or written, relating to the subject matter
hereof. Except as provided in Section 5.01, this Agreement shall become
effective when it shall have been executed by the Administrative Agent and when
the Administrative Agent shall have received counterparts hereof which, when
taken together, bear the signatures of each of the other parties hereto, and
thereafter shall be binding upon and inure to the benefit of the parties hereto
and their respective successors and assigns. Delivery of an executed counterpart
of a signature page to this Agreement by telecopy shall be effective as delivery
of a manually executed counterpart of this Agreement.
SECTION 10.07. Severability. Any provision of this Agreement held to
be invalid, illegal or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such invalidity, illegality or
unenforceability without affecting the validity, legality and enforceability of
the remaining provisions hereof; and the invalidity of a particular provision in
a particular jurisdiction shall not invalidate such provision in any other
jurisdiction.
SECTION 10.08. Right of Setoff. If an Event of Default shall have
occurred and be continuing, each Lender is hereby authorized at any time and
from time to time, to the fullest extent permitted by law, to set off and apply
any and all deposits (general or special, time or demand, provisional or final)
at any time held and other indebtedness at any time owing by such Lender to or
for the credit or the account of any Obligor against any of and all the
obligations of any Obligor now or hereafter existing under this Agreement held
by such Lender, irrespective of whether or not such Lender shall have made any
demand under this Agreement and although such obligations may be unmatured. The
rights of each Lender under this Section are in addition to other rights and
remedies (including other rights of setoff) which such Lender may have.
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SECTION 10.09. Governing Law; Jurisdiction; Etc.
(a) Governing Law. This Agreement shall be construed in accordance
with and governed by the law of the State of New York.
(b) Submission to Jurisdiction. Each Obligor hereby irrevocably and
unconditionally submits, for itself and its property, to the nonexclusive
jurisdiction of the Supreme Court of the State of New York sitting in New York
County and of the United States District Court of the Southern District of New
York, and any appellate court from any thereof, in any action or proceeding
arising out of or relating to this Agreement, or for recognition or enforcement
of any judgment, and each of the parties hereto hereby irrevocably and
unconditionally agrees that all claims in respect of any such action or
proceeding may be heard and determined in such New York State court or, to the
extent permitted by law, in such Federal court. Each of the parties hereto
agrees that a final judgment in any such action or proceeding shall be
conclusive and may be enforced in other jurisdictions by suit on the judgment or
in any other manner provided by law. Nothing in this Agreement shall affect any
right that the Administrative Agent, any Issuing Lender or any Lender may
otherwise have to bring any action or proceeding relating to this Agreement
against any Obligor or its properties in the courts of any jurisdiction.
(c) Waiver of Venue. Each Obligor hereby irrevocably and
unconditionally waives, to the fullest extent it may legally and effectively do
so, any objection which it may now or hereafter have to the laying of venue of
any suit, action or proceeding arising out of or relating to this Agreement in
any court referred to in paragraph (b) of this Section. Each of the parties
hereto hereby irrevocably waives, to the fullest extent permitted by law, the
defense of an inconvenient forum to the maintenance of such action or proceeding
in any such court.
(d) Service of Process. Each party to this Agreement irrevocably
consents to service of process in the manner provided for notices in Section
10.01. Nothing in this Agreement will affect the right of any party to this
Agreement to serve process in any other manner permitted by law.
SECTION 10.10. WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY
WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE
TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF
OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY (WHETHER
BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH PARTY HERETO (A) CERTIFIES
THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED,
EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD
Credit Agreement
<PAGE>
-114-
NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B)
ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER
INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND
CERTIFICATIONS IN THIS SECTION.
SECTION 10.11. Headings. Article and Section headings and the Table
of Contents used herein are for convenience of reference only, are not part of
this Agreement and shall not affect the construction of, or be taken into
consideration in interpreting, this Agreement.
SECTION 10.12. Treatment of Certain Information; Confidentiality.
(a) Treatment of Certain Information. The Borrower acknowledges that
from time to time financial advisory, investment banking and other services may
be offered or provided to the Borrower or one or more of its Subsidiaries (in
connection with this Agreement or otherwise) by any Lender or by one or more
subsidiaries or affiliates of such Lender and the Borrower hereby authorizes
each Lender to share any information delivered to such Lender by the Borrower
and its Subsidiaries pursuant to this Agreement, or in connection with the
decision of such Lender to enter into this Agreement, to any such subsidiary or
affiliate, it being understood that any such subsidiary or affiliate receiving
such information shall be bound by the provisions of paragraph (b) of this
Section as if it were a Lender hereunder. Such authorization shall survive the
repayment of the Loans, the expiration or termination of the Letters of Credit
and the Commitments or the termination of this Agreement or any provision
hereof.
(b) Confidentiality. Each of the Administrative Agent, the Issuing
Lenders and the Lenders agrees to maintain the confidentiality of the
Information (as defined below), except that Information may be disclosed (i) to
its and its Affiliates' directors, officers, employees and agents, including
accountants, legal counsel and other advisors (it being understood that the
Persons to whom such disclosure is made will be informed of the confidential
nature of such Information and instructed to keep such Information
confidential), (ii) to the extent requested by any regulatory authority, (iii)
to the extent required by applicable laws or regulations or by any subpoena or
similar legal process, (iv) to any other party to this Agreement, (v) to any
direct or indirect contractual counterparty in swap agreements or such
contractual counterparty's professional advisor (so long as such contractual
counterparty or professional advisor to such contractual counterparty agrees to
be bound by the provisions of this Section 10.12), (vi) in connection with the
exercise of any remedies hereunder or under any other Credit Document or any
suit, action or proceeding relating to this Agreement or any other Credit
Document or the enforcement of rights hereunder or thereunder, (vii) subject to
an agreement containing provisions substantially the same as those of this
paragraph, to any assignee of or Participant in, or any prospective assignee of
or Participant in, any of its rights or obligations under this Agreement, (viii)
with the consent of the Borrower or (ix) to the extent such Information
Credit Agreement
<PAGE>
-115-
(A) becomes publicly available other than as a result of a breach of this
paragraph or (B) becomes available to the Administrative Agent, any Issuing
Lender or any Lender on a nonconfidential basis (and not as a result of a breach
of any applicable confidentiality agreement known to the Administrative Agent,
any Issuing Lender and/or any Lender) from a source other than an Obligor. For
the purposes of this paragraph, "Information" means all information received
from any Obligor relating to any Obligor or its business, other than any such
information that is available to the Administrative Agent, any Issuing Lender or
any Lender on a nonconfidential basis prior to disclosure by an Obligor;
provided that, in the case of information received from an Obligor after the
date hereof, such information is clearly identified at the time of delivery as
confidential. Any Person required to maintain the confidentiality of Information
as provided in this Section shall be considered to have complied with its
obligation to do so if such Person has exercised the same degree of care to
maintain the confidentiality of such Information as such Person would accord to
its own confidential information.
SECTION 10.13. European Monetary Union.
(a) Definitions. In this Section and in each other provision of this
Agreement to which reference is made in this Section (whether expressly or
impliedly), the following terms have the meanings given to them in this Section:
"EMU" means Economic and Monetary Union as contemplated in the
Treaty on European Union.
"EMU Legislation" means legislative measures of the European Council
(including European Council regulations) for the introduction of,
changeover to or operation of a single or unified European currency
(whether known as the euro or otherwise), being in part the implementation
of the third stage of EMU.
"Euro" means the single currency of Participating Member States of
the European Union, which shall be a Foreign Currency under this
Agreement.
"Euro Unit" means a currency unit of the Euro.
"National Currency Unit" means a unit of any Foreign Currency (other
than a Euro Unit) of a Participating Member State.
"Participating Member State" means each state so described in any
EMU Legislation.
"TARGET Operating Day" means any day that is not (i) a Saturday or
Sunday, (ii) Christmas Day or New Year's Day or (iii) any other day on
which the Trans-European
Credit Agreement
<PAGE>
-116-
Automated Real-time Gross Settlement Express Transfer system (or any
successor settlement system) is not operating (as determined by the
Administrative Agent).
"Treaty on European Union" shall mean the Treaty of Rome of March
25, 1957, as amended by the Single European Act 1986 and the Maastricht
Treaty (which was signed at Maastricht on February 7, 1992, and came into
force on November 1, 1993), as amended from time to time.
(b) Effectiveness of Provisions. The provisions of paragraphs (c)
through (h) of this Section shall be effective from and after January 1, 1999,
provided that if and to the extent that any such provision relates to any state
(or the currency of such state) that is not a Participating Member State on the
date hereof, such provision shall become effective in relation to such state
(and the currency of such state) at and from the date on which such state
becomes a Participating Member State.
(c) Redenomination and Alternative Currencies. Each obligation under
this Agreement of a party to this Agreement which has been denominated in the
National Currency Unit of a Participating Member State shall be denominated, or
redenominated into, the Euro Unit in accordance with EMU Legislation, provided
that if and to the extent that any EMU Legislation provides that an amount
denominated either in the Euro or in the National Currency Unit of a
Participating Member State and payable within the Participating Member State by
crediting an account of the creditor can be paid by the debtor either in the
Euro Unit or in that National Currency Unit, any party to this Agreement shall
be entitled to pay or repay any such amount either in the Euro Unit or in such
National Currency Unit.
(d) Payments by the Administrative Agent Generally. With respect to
the payment of any amount denominated in the Euro or in a National Currency
Unit, neither the Foreign Currency Lender nor the Administrative Agent shall be
liable to any Subsidiary Borrower or any of the Lenders in any way whatsoever
for any delay, or the consequences of any delay, in the crediting to any account
of any amount required by this Agreement to be paid by the Administrative Agent
or the Foreign Currency Lender if the Administrative Agent or the Foreign
Currency Lender, as the case may be, shall have taken all relevant steps to
achieve, on the date required by this Agreement, the payment of such amount in
immediately available, freely transferable, cleared funds (in the Euro Unit or,
as the case may be, in a National Currency Unit) to the account of such
Subsidiary Borrower or any Lender, as the case may be, in the principal
financial center in the Participating Member State which such Subsidiary
Borrower or, as the case may be, such Lender shall have specified for such
purpose. In this paragraph (d), "all relevant steps" shall mean all such steps
as may be prescribed from time to time by the regulations or operating
procedures of such clearing or settlement system as the Administrative
Credit Agreement
<PAGE>
-117-
Agent or the Foreign Currency Lender, as the case may be, may from time to time
determine for the purpose of clearing or settling payments of the Euro.
(e) Determination of Foreign Currency Interest Rate. For the
purposes of determining the date on which the applicable rate for Foreign
Currency Borrowings is determined under this Agreement for any Foreign Currency
Credit denominated in the Euro (or any National Currency Unit) for any interest
period therefor (if relevant), references in this Agreement to Business Days
shall be deemed to be references to TARGET Operating Days.
(f) Basis of Accrual. If the basis of accrual of interest or fees
expressed in this Agreement with respect to the Foreign Currency of any state
that becomes a Participating Member State shall be inconsistent with any
convention or practice in the applicable interbank market for the basis of
accrual of interest or fees in respect of the Euro, such convention or practice
shall replace such expressed basis effective as of and from the date on which
such state becomes a Participating Member State, provided that if any Foreign
Currency Credit in the Foreign Currency of such state, outstanding immediately
prior to such date, such replacement shall take effect, with respect to such
Loan, at the end of the then current interest period (if any) for such Foreign
Currency Credit.
(g) Rounding. Without prejudice and in addition to any method of
conversion or rounding prescribed by the EMU Legislation, each reference in this
Agreement to a minimum amount (or a multiple thereof) in a National Currency
Unit to be paid to or by the Foreign Currency Lender or the Administrative Agent
shall be replaced by a reference to such reasonably comparable and convenient
amount (or a multiple thereof) in the Euro Unit as the Foreign Currency Lender
or the Administrative Agent, as the case may be, may from time to time specify.
(h) Other Consequential Changes. Without prejudice to the respective
liabilities of the Subsidiary Borrowers to the Foreign Currency Lender and of
the Foreign Currency Lender to the Subsidiary Borrowers under or pursuant to
this Agreement, except as expressly provided in this Section (but subject, in
any event, to Sections 10.02(b) and 10.02(c)), each provision of this Agreement
shall be subject to such reasonable changes of construction as the Foreign
Currency Lender or the Administrative Agent, as the case may be, may from time
to time specify to be necessary or appropriate to reflect the introduction of or
changeover to the Euro in Participating Member States.
Credit Agreement
<PAGE>
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed by their respective authorized officers as of the day and year
first above written.
CHART INDUSTRIES, INC.
By /s/ Don A. Baines
---------------------------
Name: Don A. Baines
Title: Treasurer and Chief
Financial Officer
SUBSIDIARY BORROWERS
CHART MARSTON LIMITED
By /s/ Don A. Baines
----------------------------
Name: Don A. Baines
Title: Director
Credit Agreement
<PAGE>
-119-
SUBSIDIARY GUARANTORS
ALTEC, INC.
By /s/ Don A. Baines
----------------------------
Name: Don A. Baines
Title: Assistant Secretary
ALTEC INTERNATIONAL LIMITED
PARTNERSHIP
By: CHART MANAGEMENT COMPANY, INC.,
as its sole general partner
By /s/ Don A. Baines
----------------------------
Name: Don A. Baines
Title: Chief Financial Officer,
Treasurer and Secretary
CHART INDUSTRIES FOREIGN SALES
CORPORATION
By /s/ Don A. Baines
----------------------------
Name: Don A. Baines
Title: Secretary and Treasurer
CHART INTERNATIONAL INC.
By /s/ Don A. Baines
----------------------------
Name: Don A. Baines
Title: Treasurer and Chief
Financial Officer
Credit Agreement
<PAGE>
-120-
CHART MANAGEMENT COMPANY, INC.
By /s/ Don A. Baines
----------------------------
Name: Don A. Baines
Title: Secretary and Treasurer
CRYENCO, INC.
By /s/ Don A. Baines
-----------------------------
Name: Don A. Baines
Title: Secretary, Treasurer and
Chief Financial Officer
CRYENCO SCIENCES, INC.
By /s/ Don A. Baines
-----------------------------
Name: Don A. Baines
Title: Secretary, Treasurer and
Chief Financial Officer
GREENVILLE TUBE CORPORATION
By /s/ Don A. Baines
-----------------------------
Name: Don A. Baines
Title: Assistant Secretary
PROCESS SYSTEMS INTERNATIONAL, INC.
By /s/ Don A. Baines
------------------------------
Name: Don A. Baines
Title: Assistant Clerk, Treasurer
Credit Agreement
<PAGE>
-121-
NCI SALES AND LEASING, INC.
By /s/ Don A. Baines
--------------------------------
Name: Don A. Baines
Title: Secretary and Treasurer
NORTHCOAST ACQUISITION CORP.
By /s/ Don A. Baines
--------------------------------
Name: Don A. Baines
Title: Vice President, Secretary
and Treasurer
NORTHCOAST OF AMERICA CRYOGENIC INC.
By /s/ Don A. Baines
--------------------------------
Name: Don A. Baines
Title: Secretary and Treasurer
MVE HOLDINGS, INC.
By /s/ Don A. Baines
---------------------------------
Name: Don A. Baines
Title: Assistant Secretary
Credit Agreement
<PAGE>
-122-
LENDERS
THE CHASE MANHATTAN BANK,
individually and as Administrative
Agent
By /s/ William D. Rindfuss
-------------------------------
Name: William D. Rindfuss
Title: Vice President
NATIONAL CITY BANK
By /s/ Anthony J. Dimare
-------------------------------
Name: Anthony J. Dimare
Title: Senior Vice President
NBD BANK
By /s/ Patrick F. Dunphy
-------------------------------
Name: Patrick F. Dunphy
Title: Vice President
VAN KAMPEN PRIME RATE INCOME TRUST
By /s/ Jeffrey W. Maillet
-------------------------------
Name: Jeffrey W. Maillet
Title: Senior Vice President and
Director
Credit Agreement
<PAGE>
-123-
SENIOR DEBT PORTFOLIO
By: Boston Management and Research,
as Investment Advisor
By_________________________
Name:
Title:
U.S. BANK NATIONAL ASSOCIATION
By /s/ Megan G. Mourning
--------------------------------
Name: Megan G. Mourning
Title: Vice President
UNION BANK OF CALIFORNIA, N.A.
By /s/ J. Scott Jessup
--------------------------------
Name: J. Scott Jessup
Title: Vice President
FLEET NATIONAL BANK
By /s/ Thomas J. Mahoney
--------------------------------
Name: Thomas J. Mahoney
Title: Vice President
Credit Agreement
<PAGE>
-124-
GENERAL ELECTRIC CAPITAL CORPORATION
By /s/ William E. Magee
---------------------------------
Name: William E. Magee
Title: Duly Authorized Signatory
HARRIS TRUST AND SAVINGS BANK
By /s/ Kwang S. Son
---------------------------------
Name: Kwang S. Son
Title: Assistant Vice President
THE HUNTINGTON NATIONAL BANK
By /s/ Robert G. Zellar
---------------------------------
Name: Robert G. Zellar
Title: Senior Vice President
NATIONSBANK, N.A.
By /s/ Lisa S. Donoghue
---------------------------------
Name: Lisa S. Donoghue
Title: Sr. Vice President
Credit Agreement
<PAGE>
-125-
STATE STREET BANK AND TRUST COMPANY
By /s/ Christopher DelSignore
----------------------------------
Name: Christopher DelSignore
Title: Vice President
BANK AUSTRIA CREDITANSTALT CORPORATE
FINANCE, INC.
By /s/ Douglas B. Warren
----------------------------------
Name: Douglas B. Warren
Title: Vice President
FIRST MERIT BANK N.A.
By /s/ John F. Newmann
----------------------------------
Name: John F. Newmann
Title: Vice President
KEYBANK NATIONAL ASSOCIATION
By /s/ Brendan A. Lawlor
----------------------------------
Name: Brendan A. Lawlor
Title: Assistant Vice President
Credit Agreement
<PAGE>
-126-
KZH RIVERSIDE LLC
By /s/ Virginia Conway
----------------------------------
Name: Virginia Conway
Title: Authorized Agent
KZH STERLING LLC
By /s/ Virginia Conway
----------------------------------
Name: Virginia Conway
Title: Authorized Agent
KZH CYPRESSTREE - 1 LLC
By /s/ Virginia Conway
----------------------------------
Name: Virginia Conway
Title: Authorized Agent
Credit Agreement
<PAGE>
SCHEDULE I
Commitments
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------------------------
LENDER A Term Loan B Term Loan Revolving Loan Total Commitment
- -------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
The Chase Manhattan Bank $ 15,000,000.00 $ 23,000,000.00 $ 6,000,000.00 $ 44,000,000.00
- -------------------------------------------------------------------------------------------------------------------
National City Bank $ 17,142,857.14 $ 6,857,142.86 $ 24,000,000.00
- -------------------------------------------------------------------------------------------------------------------
NBD Bank $ 10,714,285.72 $ 5,000,000.00 $ 4,285,714.28 $ 20,000,000.00
- -------------------------------------------------------------------------------------------------------------------
Van Kampen Prime Rate Income Trust $ 30,000,000.00 $ 30,000,000.00
- -------------------------------------------------------------------------------------------------------------------
U.S. Bank National Association $ 10,714,285.72 $ 5,000,000.00 $ 4,285,714.28 $ 20,000,000.00
- -------------------------------------------------------------------------------------------------------------------
Union Bank of California, N.A $ 7,142,857.14 $ 7,000,000.00 $ 2,857,142.86 $ 17,000,000.00
- -------------------------------------------------------------------------------------------------------------------
Fleet National Bank $ 7,142,857.14 $ 5,000,000.00 $ 2,857,142.86 $ 15,000,000.00
- -------------------------------------------------------------------------------------------------------------------
General Electric Capital Corporation $ 15,000,000.00 $ 15,000,000.00
- -------------------------------------------------------------------------------------------------------------------
Harris Trust and Savings Bank $ 10,714,285.72 $ 4,285,714.28 $ 15,000,000.00
- -------------------------------------------------------------------------------------------------------------------
The Huntington National Bank $ 7,142,857.14 $ 5,000,000.00 $ 2,857,142.86 $ 15,000,000.00
- -------------------------------------------------------------------------------------------------------------------
NationsBank, N.A $ 10,714,285.72 $ 4,285,714.28 $ 15,000,000.00
- -------------------------------------------------------------------------------------------------------------------
State Street Bank and Trust Company $ 7,142,857.14 $ 5,000,000.00 $ 2,857,142.86 $ 15,000,000.00
- -------------------------------------------------------------------------------------------------------------------
Bank Austria Creditanstalt
Corporate Finance, Inc. $ 7,142,857.14 $ 2,857,142.86 $ 10,000,000.00
- -------------------------------------------------------------------------------------------------------------------
First Merit Bank N.A $ 7,142,857.14 $ 2,857,142.86 $ 10,000,000.00
- -------------------------------------------------------------------------------------------------------------------
KeyBank National Association $ 7,142,857.14 $ 2,857,142.86 $ 10,000,000.00
- -------------------------------------------------------------------------------------------------------------------
KZH Riverside LLC $ 10,000,000.00 $ 10,000,000.00
- -------------------------------------------------------------------------------------------------------------------
KZH Sterling LLC $ 10,000,000.00 $ 10,000,000.00
- -------------------------------------------------------------------------------------------------------------------
KZH Cypress Tree - 1 LLC $ 5,000,000.00 $ 5,000,000.00
- -------------------------------------------------------------------------------------------------------------------
TOTAL $125,000,000.00 $125,000,000.00 $50,000,000.00 $300,000,000.00
- -------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
SCHEDULE II
Debt Agreements and Liens
[See Section 4.14, Section 5.01(m), Section 7.01(b) and Section 7.02(c)]
Part A - Material Agreements
Part B - Liens
Schedule II to Credit Agreement
<PAGE>
SCHEDULE III
Restrictive Agreements
[See Section 7.07]
Schedule III to Credit Agreement
<PAGE>
SCHEDULE IV
Litigation
[See Section 4.06]
Schedule IV to Credit Agreement
<PAGE>
SCHEDULE V
Environmental Matters
[See Section 4.07]
Schedule V to Credit Agreement
<PAGE>
SCHEDULE VI
Subsidiaries and Investments
[See Section 4.16]
Part A - Subsidiaries
Part B - Investments
Schedule VI to Credit Agreement
<PAGE>
SCHEDULE VII
Real Property
[See Section 4.17]
Schedule VII to Credit Agreement
<PAGE>
SCHEDULE VIII
Labor Matters
[See Section 4.19]
Schedule VIII to Credit Agreement
<PAGE>
SCHEDULE IX
Existing Letters of Credit
Schedule IX to Credit Agreement
<PAGE>
EXHIBIT A
[Form of Assignment and Acceptance]
ASSIGNMENT AND ACCEPTANCE
Reference is made to the Credit Agreement dated as of April 12, 1999
(as amended and in effect on the date hereof, the "Credit Agreement"), between
Chart Industries, Inc., the Subsidiary Borrowers party thereto, the Subsidiary
Guarantors party thereto, the Lenders party thereto, The Chase Manhattan Bank,
as Administrative Agent for the Lenders and National City Bank, as Documentation
Agent. Terms defined in the Credit Agreement are used herein with the same
meanings.
The Assignor named below hereby sells and assigns, without recourse,
to the Assignee named below, and the Assignee hereby purchases and assumes,
without recourse, from the Assignor, effective as of the Assignment Date set
forth below, the interests set forth below (the "Assigned Interest") in the
Assignor's rights and obligations under the Credit Agreement, including the
interests set forth below in the Commitment of the Assignor on the Assignment
Date and Syndicated Loans owing to the Assignor which are outstanding on the
Assignment Date, together with unpaid interest accrued on the assigned Loans to
the Assignment Date, the participations in Letters of Credit, LC Disbursements
and Swingline Loans held by the Assignor on the Assignment Date, and the amount,
if any, set forth below of the fees accrued to the Assignment Date for account
of the Assignor. The Assignee hereby acknowledges receipt of a copy of the
Credit Agreement. From and after the Assignment Date (i) the Assignee shall be a
party to and be bound by the provisions of the Credit Agreement and, to the
extent of the interests assigned by this Assignment and Acceptance, have the
rights and obligations of a Lender thereunder and (ii) the Assignor shall, to
the extent of the interests assigned by this Assignment and Acceptance,
relinquish its rights and be released from its obligations under the Credit
Agreement.
This Assignment and Acceptance is being delivered to the
Administrative Agent together with (i) if the Assignee is a Foreign Lender, any
documentation required to be delivered by the Assignee pursuant to Section
2.16(e) of the Credit Agreement, duly completed and executed by the Assignee,
and (ii) if the Assignee is not already a Lender under the Credit Agreement, an
Administrative Questionnaire in the form supplied by the Administrative Agent,
duly completed by the Assignee. The [Assignee/Assignor] shall pay the fee
payable to the Administrative Agent pursuant to Section 10.04(b) of the Credit
Agreement.
This Assignment and Acceptance shall be governed by and construed in
accordance with the laws of the State of New York.
Assignment and Acceptance
<PAGE>
-2-
Date of Assignment:
Legal Name of Assignor:
Legal Name of Assignee:
Assignee's Address for Notices:
Effective Date of Assignment
("Assignment Date"):
Percentage Assigned
of Facility/
Commitment (set
forth, to at least 8
decimals, as a
percentage of the
Facility and the
aggregate
Commitments
Principal Amount of all Lenders
Facility Assigned thereunder)
- -------- -------- -----------
Commitment Assigned: $ %
Revolving Credit Commitment
Term Loan A Commitment
Term Loan B Commitment
Syndicated Loans:
Revolving Credit Loans
Term Loan A
Term Loan B
Fees Assigned (if any):
Assignment and Acceptance
<PAGE>
-3-
The terms set forth above are hereby agreed to:
[NAME OF ASSIGNOR], as Assignor
By:_________________________
Name:
Title:
[NAME OF ASSIGNEE], as Assignee
By:_________________________
Name:
Title:
The undersigned hereby consent to the within assignment:(1)
CHART INDUSTRIES, INC.
By:_________________________
Name:
Title:
THE CHASE MANHATTAN BANK,
as Administrative Agent,
as Swingline Lender
and as Issuing Lender
By:_________________________
Name:
Title:
- --------
1 Consents to be included to the extent required by Section 10.04(b) of the
Credit Agreement.
Assignment and Acceptance
<PAGE>
-4-
NBD BANK, as Foreign Currency Lender
By:_________________________
Name:
Title:
Assignment and Acceptance
<PAGE>
EXHIBIT B
SECURITY AGREEMENT
SECURITY AGREEMENT dated as of April 12, 1999, between CHART
INDUSTRIES, INC., a corporation duly organized and validly existing under the
laws of the State of Delaware (the "Borrower"); each of the Subsidiaries of the
Borrower identified under the caption "SUBSIDIARY GUARANTORS" on the signature
pages hereto (individually, a "Subsidiary Guarantor" and, collectively, the
"Subsidiary Guarantors" and, together with the Borrower, the "Obligors"); and
THE CHASE MANHATTAN BANK, as administrative agent for the lenders or other
financial institutions or entities party, as lenders, to the Credit Agreement
referred to below (in such capacity, together with its successors in such
capacity, the "Administrative Agent").
The Borrower, the Subsidiary Borrowers, the Subsidiary Guarantors,
the Lenders party thereto, the Administrative Agent and National City Bank, as
Documentation Agent are parties to a Credit Agreement dated as of April 12, 1999
(as modified and supplemented and in effect from time to time, the "Credit
Agreement"), providing, subject to the terms and conditions thereof, for
extensions of credit (by making of loans and issuing letters of credit) to be
made by the Lenders to the Borrower and/or the Subsidiary Borrowers in an
aggregate principal or face amount not exceeding $300,000,000. In addition, the
Borrower may from time to time be obligated to various of said lenders (or their
affiliates) in respect of one or more Hedging Agreements under and as defined in
the Credit Agreement.
To induce said lenders to enter into the Credit Agreement and to
extend credit thereunder and to extend credit under Hedging Agreements, and for
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, each Obligor has agreed to pledge and grant a security
interest in the Collateral (as hereinafter defined) as security for the Secured
Obligations (as so defined). Accordingly, the parties hereto agree as follows:
Section 1. Definitions. Terms defined in the Credit Agreement are
used herein as defined therein. In addition, as used herein:
"Accounts" has the meaning assigned to such term in Section 3(e).
"Collateral" has the meaning assigned to such term in Section 3.
"Collateral Account" has the meaning assigned to such term in
Section 4.01.
Security Agreement
<PAGE>
-2-
"Copyright Collateral" means all Copyrights, whether now owned or
hereafter acquired by any Obligor, including each Copyright identified in
Annex 2.
"Copyrights" means all copyrights, copyright registrations and
applications for copyright registrations, including, without limitation,
all renewals and extensions thereof, the right to recover for all past,
present and future infringements thereof, and all other rights of any kind
whatsoever accruing thereunder or pertaining thereto.
"Documents" has the meaning assigned to such term in Section 3(k).
"Equipment" has the meaning assigned to such term in Section 3(i).
"Instruments" has the meaning assigned to such term in Section 3(f).
"Intellectual Property" means, collectively, all Copyright
Collateral, all Patent Collateral and all Trademark Collateral, together
with (a) all inventions, processes, production methods, proprietary
information, know-how and trade secrets; (b) all licenses or user or other
agreements granted to any Obligor with respect to any of the foregoing, in
each case whether now or hereafter owned or used including, without
limitation, the licenses or other agreements with respect to the Copyright
Collateral, the Patent Collateral or the Trademark Collateral, listed in
Annex 5; (c) all information, customer lists, identification of suppliers,
data, plans, blueprints, specifications, designs, drawings, recorded
knowledge, surveys, engineering reports, test reports, manuals, materials
standards, processing standards, performance standards, catalogs, computer
and automatic machinery software and programs; (d) all field repair data,
sales data and other information relating to sales or service of products
now or hereafter manufactured; (e) all accounting information and all
media in which or on which any information or knowledge or data or records
may be recorded or stored and all computer programs used for the
compilation or printout of such information, knowledge, records or data;
(f) all licenses, consents, permits, variances, certifications and
approvals of governmental agencies now or hereafter held by any Obligor;
and (g) all causes of action, claims and warranties now or hereafter owned
or acquired by any Obligor in respect of any of the items listed above.
"Inventory" has the meaning assigned to such term in Section 3(g).
"Issuers" means, collectively, the respective corporations
identified on Annex 1 under the caption "Issuer", and each other
Subsidiary of the Borrower formed or acquired after the date hereof and
required by Section 6.10(a) of the Credit Agreement to be added as an
"Issuer" under this Agreement (but excluding any Foreign Subsidiary to the
extent covered by a separate Foreign Subsidiary Pledge Agreement).
Security Agreement
<PAGE>
-3-
"Motor Vehicles" means motor vehicles, tractors, trailers and other
like property, whether or not the title thereto is governed by a
certificate of title or ownership.
"Other Issuer" means an Issuer organized other than as a
corporation.
"Patent Collateral" means all Patents, whether now owned or
hereafter acquired by any Obligor, including each Patent identified in
Annex 3.
"Patents" means all patents and patent applications, including,
without limitation, the inventions and improvements described and claimed
therein together with the reissues, divisions, continuations, renewals,
extensions and continuations-in-part thereof, all income, royalties,
damages and payments now or hereafter due and/or payable under and with
respect thereto, including, without limitation, damages and payments for
past or future infringements thereof, the right to sue for past, present
and future infringements thereof, and all rights corresponding thereto
throughout the world.
"Pledged Interests" has the meaning assigned to such term in Section
3(d).
"Pledged Stock" has the meaning assigned to such term in Section
3(a).
"Secured Obligations" means, collectively, (a) in the case of the
Borrower, the principal and interest on the Loans made by the Lenders to
the Borrower and all other amounts from time to time owing to the Lenders
or the Administrative Agent by the Borrower under the Credit Documents
(including, without limitation, all LC Disbursements and interest thereon
and all obligations of the Borrower to the Lenders or any of their
affiliates in respect of Hedging Agreements), (b) in the case of the
Subsidiary Guarantors, all obligations of the Subsidiary Guarantors under
the Credit Agreement and the other Credit Documents (including, without
limitation, in respect of their respective Guarantee under Article III of
the Credit Agreement), (c) in the case of the Subsidiary Borrowers, the
principal of and interest on the Foreign Currency Credits made by the
Foreign Currency Lender to the Subsidiary Borrowers and all other amounts
from time to time owing to the Foreign Currency Lender or the
Administrative Agent by the Subsidiary Borrowers under the Credit
Documents, (d) all obligations of Chart Marston Limited ("Chart Marston")
to NBD Bank or any of its affiliates in respect of a line of credit
provided to Chart Marston in Pounds Sterling not exceeding 5,000,000 and
(e) all obligations of the Obligors to the Lenders and the Administrative
Agent hereunder.
"Stock Collateral" has the meaning assigned to such term in Section
3(c) and shall include the proceeds of and to the Stock Collateral and, to
the extent related thereto or such proceeds, all books, correspondence,
credit files, records, invoices and other papers.
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"Trademark Collateral" means all Trademarks, whether now owned or
hereafter acquired by any Obligor, including each Trademark identified in
Annex 4. Notwithstanding the foregoing, the Trademark Collateral does not
and shall not include any Trademark that would be rendered invalid,
abandoned, void or unenforceable by reason of its being included as part
of the Trademark Collateral.
"Trademarks" means all trade names, trademarks and service marks,
logos, trademark and service mark registrations, and applications for
trademark and service mark registrations, including, without limitation,
all renewals of trademark and service mark registrations, all rights
corresponding thereto throughout the world, the right to recover for all
past, present and future infringements thereof, all other rights of any
kind whatsoever accruing thereunder or pertaining thereto, together, in
each case, with the product lines and goodwill of the business connected
with the use of, and symbolized by, each such trade name, trademark and
service mark.
"Uniform Commercial Code" means the Uniform Commercial Code as in
effect from time to time in the State of New York.
Section 2. Representations and Warranties. Each Obligor represents
and warrants to the Lenders and the Administrative Agent that:
(a) Ownership and Liens. Such Obligor is the sole beneficial owner
of the Collateral in which it purports to grant a security interest
pursuant to Section 3 and no Lien exists or will exist upon such
Collateral at any time, except for liens permitted under Section 7.02 of
the Credit Agreement and except for the pledge and security interest in
favor of the Administrative Agent for the benefit of the Lenders created
or provided for herein, which pledge and security interest constitute a
first priority perfected pledge and security interest in and to all of
such Collateral.
(b) Pledged Stock. The Pledged Stock evidenced by the certificates
identified opposite the name of such Obligor in Part A of Annex 1 (to the
extent such Pledged Stock is certificated) is, and all other Pledged Stock
in which such Obligor shall hereafter grant a security interest pursuant
to Section 3 will be, duly authorized, validly existing, fully paid and
non-assessable and none of such Pledged Stock is or will be subject to any
contractual restriction, or any restriction under the charter or by-laws
of the respective Issuer of such Pledged Stock, upon the transfer of such
Pledged Stock (except for any such restriction contained herein or in the
Credit Agreement). Except as otherwise disclosed in Part A of Annex 1, the
Pledged Stock evidenced by the certificates identified opposite the name
of such Obligor in Part A of Annex 1 constitutes all of the issued and
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outstanding shares of capital stock of any class of the Issuers
beneficially owned by such Obligor on the date hereof (whether or not
registered in the name of such Obligor) and Part A of Annex 1 correctly
identifies, as at the date hereof, the respective Issuers of such Pledged
Stock, the respective class and par value of the shares constituting such
Pledged Stock and the respective number of shares (and registered owners
thereof) represented by each such certificate.
(c) Pledged Interests. The Pledged Interests (if any) identified
opposite the name of such Obligor in Part B of Annex 1 are, and all other
Pledged Interests in which such Obligor shall hereafter grant a security
interest pursuant to Section 3, will (to the extent applicable) be, duly
authorized, validly existing, fully paid and non-assessable and none of
such Pledged Interests is or will be subject to any contractual
restriction, upon the transfer of such Pledged Interests (except for any
such restriction contained herein or as permitted under the Credit
Agreement) and the Pledged Interests constitute all of the ownership
interests in the Other Issuers held by such Obligor (whether or not
registered in the name of such Obligor), and such Obligor is the
registered owner of all such ownership interests.
(d) Copyrights, Patents and Trademarks. Annexes 2, 3 and 4,
respectively, set forth under the name of such Obligor a complete and
correct list of all Copyrights, Patents and Trademarks owned by such
Obligor on the date hereof; except pursuant to licenses and other user
agreements entered into by such Obligor in the ordinary course of business
that are listed in Annex 5, such Obligor owns and possesses the right to
use, and has done nothing to authorize or enable any other Person to use,
any Copyright, Patent or Trademark listed in Annexes 2, 3 and 4, and all
registrations listed in Annexes 2, 3 and 4 are valid and in full force and
effect; except as may be set forth in Annex 5, such Obligor owns and
possesses the right to use all Copyrights, Patents and Trademarks.
(e) Licenses. Annex 5 sets forth a complete and correct list of all
licenses and other user agreements included in the Intellectual Property
on the date hereof.
(f) No Violations in Respect of Copyrights, Patents and Trademarks.
To such Obligor's knowledge, (i) except as set forth in Annex 5, there is
no violation by others of any right of such Obligor with respect to any
Copyright, Patent or Trademark listed in Annexes 2, 3 and 4, respectively,
under the name of such Obligor and (ii) such Obligor is not infringing in
any respect upon any Copyright, Patent or Trademark of any other Person;
and no proceedings have been instituted or are pending against such
Obligor or, to such Obligor's knowledge, threatened, and no claim against
such Obligor has been received by such Obligor, alleging any such
violation, except as may be set forth in Annex 5.
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(g) Trademark Collateral. Except as disclosed in Annex 4, such
Obligor does not own any Trademarks registered in the United States of
America to which the last sentence of the definition of Trademark
Collateral applies.
(h) Fair Labor Standards Act. Any goods now or hereafter produced by
such Obligor or any of its Subsidiaries included in the Collateral have
been and will be produced in compliance with the requirements of the Fair
Labor Standards Act, as amended.
Section 3. Collateral. As collateral security for the prompt payment
in full when due (whether at stated maturity, by acceleration or otherwise) of
the Secured Obligations, each Obligor hereby pledges and grants to the
Administrative Agent, for the benefit of the Lenders as hereinafter provided, a
security interest in all of such Obligor's right, title and interest in the
following property, whether now owned by such Obligor or hereafter acquired and
whether now existing or hereafter coming into existence (all being collectively
referred to herein as "Collateral"):
(a) the shares of common stock of the Issuers represented by the
certificates identified in Annex 1 under the name of such Obligor and all
other shares of capital stock of whatever class of the Issuers, now or
hereafter owned by such Obligor, in each case together with the
certificates evidencing the same, provided that if any Issuer hereunder
shall be a Foreign Subsidiary the shares of capital stock of such Foreign
Subsidiary that constitute Collateral shall be limited to (i) 65% of the
voting capital stock of such Foreign Subsidiary having ordinary voting
power for the election of the board of directors (or similar body) of such
Foreign Subsidiary and (ii) 100% of all other capital stock of such
Foreign Subsidiary (collectively, the "Pledged Stock");
(b) all shares, securities, moneys or property representing a
dividend on any of the Pledged Stock, or representing a distribution or
return of capital upon or in respect of the Pledged Stock, or resulting
from a split-up, revision, reclassification or other like change of the
Pledged Stock or otherwise received in exchange therefor, and any
subscription warrants, rights or options issued to the holders of, or
otherwise in respect of, the Pledged Stock;
(c) without affecting the obligations of such Obligor under any
provision prohibiting such action hereunder or under the Credit Agreement,
in the event of any consolidation or merger in which an Issuer is not the
surviving corporation, all shares of each class of the capital stock of
the successor corporation (unless such successor corporation is such
Obligor itself) formed by or resulting from such consolidation or merger
(the Pledged Stock, together with all other certificates, shares,
securities,
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properties or moneys as may from time to time be pledged hereunder
pursuant to clause (a) or (b) above and this clause (c) being herein
collectively called the "Stock Collateral");
(d) all limited liability company, partnership or other ownership
interests of such Obligor in any Other Issuer, including, without
limitation, the respective ownership interests of the Other Issuers
identified in Part B of Annex 1 opposite the name of such Obligor, all
certificates (if any) representing or evidencing such ownership interests,
all right, title and interest in, to and under the limited liability
company, partnership or other ownership agreements (the "Other
Agreements") of any Other Issuers (including, without limitation, all of
the right, title and interest as a member or partner to participate in the
operation or management of any Other Issuer and all of its ownership
interests under the Other Agreements), and all present and future rights
of such Obligor to (i) receive payment of money, any other property or
assets in connection with its ownership interests and its rights under the
Other Agreements, (ii) any claim which such Obligor now has or may in the
future acquire against any Other Issuer and its property or arising out of
or for breach of or default under any operating, partnership or other
ownership agreement or otherwise relating to the property of any Other
Issuer and (iii) terminate, amend, supplement, modify or waive performance
under any operating, partnership or other ownership agreement, to perform
thereunder and to compel performance and to otherwise exercise all
remedies thereunder, in each case together with any certificates
evidencing the same (all of such interests being pledged pursuant to this
clause (d) herein collectively called the "Pledged Interests");
(e) all accounts and general intangibles (each as defined in the
Uniform Commercial Code) of such Obligor constituting any right to the
payment of money, including (but not limited to) all moneys due and to
become due to such Obligor in respect of any loans or advances or for
Inventory or Equipment or other goods sold or leased or for services
rendered, all moneys due and to become due to such Obligor under any
guarantee (including a letter of credit) of the purchase price of
Inventory or Equipment sold by such Obligor and all tax refunds (such
accounts, general intangibles and moneys due and to become due being
herein called collectively "Accounts");
(f) all instruments, chattel paper or letters of credit (each as
defined in the Uniform Commercial Code) of such Obligor evidencing,
representing, arising from or existing in respect of, relating to,
securing or otherwise supporting the payment of, any of the Accounts,
including (but not limited to) promissory notes, drafts, bills of exchange
and trade acceptances (herein collectively called "Instruments");
(g) all inventory (as defined in the Uniform Commercial Code) of
such Obligor, all goods obtained by such Obligor in exchange for such
inventory, and any products
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made or processed from such inventory including all substances, if any,
commingled therewith or added thereto (herein collectively called
"Inventory");
(h) all Intellectual Property and all other accounts or general
intangibles of such Obligor not constituting Intellectual Property or
Accounts;
(i) all equipment (as defined in the Uniform Commercial Code) of
such Obligor, including all Motor Vehicles (herein collectively called
"Equipment");
(j) each contract and other agreement of such Obligor relating to
the sale or other disposition of Inventory or Equipment;
(k) all documents of title (as defined in the Uniform Commercial
Code) or other receipts of such Obligor covering, evidencing or
representing Inventory or Equipment (herein collectively called
"Documents");
(l) all rights, claims and benefits of such Obligor against any
Person arising out of, relating to or in connection with Inventory or
Equipment purchased by such Obligor, including, without limitation, any
such rights, claims or benefits against any Person storing or transporting
such Inventory or Equipment;
(m) the balance from time to time in the Collateral Account;
(n) the Bond Tender Offer Collateral Account; and
(o) all other tangible and intangible personal property and fixtures
of such Obligor, including, without limitation, all proceeds, products,
offspring, accessions, rents, profits, income, benefits, substitutions and
replacements of and to any of the property of such Obligor described in
the preceding clauses of this Section 3 (including, without limitation,
any proceeds of insurance thereon and all causes of action, claims and
warranties now or hereafter held by any Obligor in respect of any of the
items listed above) and, to the extent related to any property described
in said clauses or such proceeds, products and accessions, all books,
correspondence, credit files, records, invoices and other papers,
including without limitation all tapes, cards, computer runs and other
papers and documents in the possession or under the control of such
Obligor or any computer bureau or service company from time to time acting
for such Obligor;
provided, however, that the Collateral shall not include any rights, title or
interest arising under, and any property acquired under, any agreement that
validly prohibits the creation by any Obligor of a secured interest in such
agreement or property.
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Section 4. Cash Proceeds of Collateral; Collateral Accounts.
4.01 Collateral Account. The Administrative Agent will cause to be
established at a banking institution to be selected by the Administrative Agent
a cash collateral account (the "Collateral Account"), which may be a "securities
account" (as defined in Section 8-501 of the Uniform Commercial Code), in the
name and under the sole dominion and control of the Administrative Agent (and,
in the case of a securities account, in respect of which the Administrative
Agent is the "entitlement holder" (as defined in Section 8-102(a)(7) of the
Uniform Commercial Code)), into which there shall be deposited from time to time
the cash proceeds of any of the Collateral (including proceeds of insurance
thereon) required to be delivered to the Administrative Agent pursuant hereto
and into which the Obligors may from time to time deposit any additional amounts
that any of them wishes to pledge to the Administrative Agent for the benefit of
the Lenders as additional collateral security hereunder or that, as provided in
the Credit Agreement, they are required to pledge as additional collateral
security hereunder. The balance from time to time in the Collateral Account
shall constitute part of the Collateral hereunder and shall not constitute
payment of the Secured Obligations until applied as hereinafter provided. Except
as expressly provided in the next sentence, the Administrative Agent shall remit
the collected balance standing to the credit of the Collateral Account to or
upon the order of the respective Obligor as such Obligor through the Borrower
shall from time to time instruct. However, at any time following the occurrence
and during the continuance of an Event of Default, the Administrative Agent may
(and, if instructed by the Lenders as specified in Section 10.02(c) of the
Credit Agreement, shall) in its (or their) discretion apply or cause to be
applied (subject to collection) the balance from time to time standing to the
credit of the Collateral Account to the payment of the Secured Obligations in
the manner specified in Section 5.09.
4.02 Concentration Account; Proceeds of Accounts.
(a) The Obligors agree to establish and maintain a single deposit
account (the "Concentration Account") with a Lender selected by the Borrower
with the approval of the Administrative Agent (such approval not to be
unreasonably withheld) into which (subject to paragraph (b) of this Section
4.02) the Obligors shall cause all account debtors and other Persons obligated
in respect of the Accounts to make all payments, either directly or indirectly,
in respect of the Accounts. The Concentration Account as of the date hereof is
identified on Annex 7. The Borrower shall promptly notify the Administrative
Agent of any change in the location or account number of, or matters relating
to, the Concentration Account; provided that (i) the Concentration Account shall
not be held at any time at a depository institution other than a Lender which is
approved by the Administrative Agent (such approval not to be unreasonably
withheld) and (ii) upon the occurrence or during the continuation of an Event of
Default no such changes may be made without the prior written approval of the
Administrative Agent.
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(b) Upon the occurrence and during the continuation of an Event of
Default, the Administrative Agent may (i) by written notice to the Borrower
require each Obligor to instruct all account debtors and other Persons obligated
in respect of all Accounts to make all payments, in respect of the Accounts,
instead of making such payments to the Concentration Account as provided in
paragraph (a) of this Section 4.02, either (x) directly to the Administrative
Agent (by instructing that such payments be remitted to a post office box which
shall be in the name and under the control of the Administrative Agent) or (y)
to one or more other banks in the United States of America (by instructing that
such payments be remitted to a post office box which shall be in the name and
under the control of the Administrative Agent) under arrangements, in form and
substance satisfactory to the Administrative Agent, pursuant to which such
Obligor shall have irrevocably instructed such other bank (and such other bank
shall have agreed) to remit all proceeds of such payments directly to the
Administrative Agent for deposit into the Collateral Account and/or (ii)
instruct the Lender which is the depositary institution in respect of the
Concentration Account to remit the entire balance then held in the Concentration
Account directly to the Administrative Agent for deposit into the Collateral
Account (and to this end the Obligors hereby irrevocably instruct whichever
Lender shall hold the Concentration Account at such time upon receipt of such
instructions to pay such balance to the Administrative Agent). All payments made
to the Administrative Agent, as provided in the preceding sentence, shall be
immediately deposited in the Collateral Account. In addition to the foregoing
(but subject to paragraph (a) of this Section 4.02), each Obligor agrees that if
the proceeds of any Collateral hereunder (including the payments made in respect
of Accounts) shall be received by it, such Obligor shall as promptly as possible
deposit such proceeds into the Collateral Account. Until so deposited, all such
proceeds shall be held in trust by such Obligor for and as the property of the
Administrative Agent and shall not be commingled with any other funds or
property of such Obligor.
4.03 Bond Tender Offer Collateral Account. The Administrative Agent
will cause to be established at a banking institution to be selected by the
Administrative Agent a cash collateral account (the "Bond Tender Offer
Collateral Account"), which may be a "securities account" (as defined in Section
8-501 of the Uniform Commercial Code), in the name and under the sole dominion
and control of the Administrative Agent (and, in the case of a securities
account, in respect of which the Administrative Agent is the "entitlement
holder" (as defined in Section 8-102(a)(7) of the Uniform Commercial Code)),
into which there shall be deposited as of the Effective Date the proceeds of the
Term Loans in an aggregate amount at least equal to the sum of $125,000,000
minus the aggregate amount of the Term Loans (if any) that is applied by the
Borrower as of the Effective Date to consummate the Bond Tender Offer, subject
to Section 5.03 of the Credit Agreement; provided that if such sum is equal to
or less than $15,000,000, such proceeds may be returned to the Borrower. The
balance in the Bond Tender Offer Collateral Account shall be subject to
withdrawal by the Borrower only (i) to consummate the Bond Tender Offer and only
upon satisfaction of each of the conditions specified in Section 5.03
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of the Credit Agreement (unless any such condition shall have been waived in
accordance with Section 10.02 thereof) or (ii) to prepay the Term Loans in
accordance with Section 2.10(b)(vi) thereof; provided that if upon the
consummation of the Bond Tender Offer such balance shall be equal to or less
than $15,000,000, such amount shall be paid directly to the Borrower upon its
instructions.
4.04 Investment of Balance in Collateral Accounts. The cash balance
standing to the credit of the Collateral Account and the Bond Tender Offer
Collateral Account shall be invested from time to time in such Permitted
Investments as the respective Obligor through the Borrower (or, after the
occurrence and during the continuance of a Default, the Administrative Agent)
shall determine, which Permitted Investments shall be held in the name and be
under the control of the Administrative Agent (and, if the Collateral Account or
the Bond Offer Collateral Account, as the case may be, is a securities account,
credited to such account), provided that at any time after the occurrence and
during the continuance of an Event of Default, the Administrative Agent shall,
but only, if instructed by the Lenders as specified in Article VIII of the
Credit Agreement) in its (or their) discretion at any time and from time to time
elect to liquidate any such Permitted Investments and to apply or cause to be
applied the proceeds thereof to the payment of the Secured Obligations in the
manner specified in Section 5.09 (except that the funds held to the credit of
the Bond Tender Offer Collateral Account shall be applied first ratably to the
payment of the Term Loans before application to any other Secured Obligations).
4.05 Cover for LC Exposure. Amounts deposited into the Collateral
Account as cover for LC Exposure under the Credit Agreement pursuant to Section
2.05(k) thereof shall be held by the Administrative Agent in a separate
sub-account (designated "LC Exposure Sub-Account") and all amounts held in such
sub-account shall constitute collateral security first for the LC Exposure
outstanding from time to time and second as collateral security for the other
Secured Obligations hereunder.
Section 5. Further Assurances; Remedies. In furtherance of the grant
of the pledge and security interest pursuant to Section 3, the Obligors hereby
jointly and severally agree with each Lender and the Administrative Agent as
follows:
5.01 Delivery and Other Perfection. Each Obligor shall:
(a) if any of the shares, securities, moneys or property required to
be pledged by such Obligor under clauses (a), (b) and (c) of Section 3 are
received by such Obligor, forthwith either (x) transfer and deliver to the
Administrative Agent such shares or securities so received by such Obligor
(together with the certificates for any such shares and securities duly
endorsed in blank or accompanied by undated stock powers duly
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executed in blank), all of which thereafter shall be held by the
Administrative Agent, pursuant to the terms of this Agreement, as part of
the Collateral or (y) take such other action as the Administrative Agent
shall deem reasonably necessary or appropriate to duly record the Lien
created hereunder in such shares, securities, moneys or property in said
clauses (a), (b) and (c);
(b) deliver and pledge to the Administrative Agent any and all
Instruments, endorsed and/or accompanied by such instruments of assignment
and transfer in such form and substance as the Administrative Agent may
reasonably request; provided that so long as no Default shall have
occurred and be continuing, such Obligor may retain for collection in the
ordinary course any Instruments received by such Obligor in the ordinary
course of business and the Administrative Agent shall, promptly upon
request of such Obligor through the Borrower, make appropriate
arrangements for making any Instrument pledged by such Obligor available
to such Obligor for purposes of presentation, collection or renewal (any
such arrangement to be effected, to the extent deemed appropriate by the
Administrative Agent, against trust receipt or like document);
(c) give, execute, deliver, file and/or record any financing
statement, notice, instrument, document, agreement or other papers that
may be reasonably necessary or desirable (in the judgment of the
Administrative Agent) to create, preserve, perfect or validate the
security interest granted pursuant hereto or to enable the Administrative
Agent to exercise and enforce its rights hereunder with respect to such
pledge and security interest, including, without limitation, causing any
or all of the Stock Collateral to be transferred of record into the name
of the Administrative Agent or its nominee (and the Administrative Agent
agrees that if any Stock Collateral is transferred into its name or the
name of its nominee, the Administrative Agent will thereafter promptly
give to the respective Obligor copies of any notices and communications
received by it with respect to the Stock Collateral pledged by such
Obligor hereunder), provided that notices to account debtors in respect of
any Accounts or Instruments shall be subject to the provisions of clause
(i) below;
(d) without limiting the obligations of such Obligor under Section
5.04(c), upon the acquisition after the date hereof by such Obligor of any
Equipment covered by a certificate of title or ownership, cause the
Administrative Agent to be listed as the lienholder on such certificate of
title and within 120 days of the acquisition thereof deliver evidence of
the same to the Administrative Agent;
(e) keep full and accurate books and records relating to the
Collateral, and stamp or otherwise mark such books and records in such
manner as the Administrative Agent may reasonably require in order to
reflect the security interests granted by this Agreement;
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(f) furnish to the Administrative Agent from time to time (but,
unless a Default shall have occurred and be continuing, no more frequently
than annually) statements and schedules further identifying and describing
the Copyright Collateral, the Patent Collateral and the Trademark
Collateral, respectively, and such other reports in connection with the
Copyright Collateral, the Patent Collateral and the Trademark Collateral
as the Administrative Agent may reasonably request, all in reasonable
detail;
(g) promptly upon reasonable request of the Administrative Agent,
following receipt by the Administrative Agent of any statements, schedules
or reports pursuant to clause (f) above, modify this Agreement by amending
Annexes 2, 3 and/or 4, as the case may be, to include any Copyright,
Patent or Trademark that becomes part of the Collateral under this
Agreement;
(h) permit representatives of the Administrative Agent, upon
reasonable notice, at any time during normal business hours to inspect and
make abstracts from its books and records pertaining to the Collateral,
and permit representatives of the Administrative Agent to be present at
such Obligor's place of business to receive copies of all communications
and remittances relating to the Collateral, and forward copies of any
notices or communications received by such Obligor with respect to the
Collateral, all in such manner as the Administrative Agent may require;
and
(i) upon the occurrence and during the continuance of any Default,
upon request of the Administrative Agent, promptly notify (and such
Obligor hereby authorizes the Administrative Agent so to notify) each
account debtor in respect of any Accounts or Instruments that such
Collateral has been assigned to the Administrative Agent hereunder, and
that any payments due or to become due in respect of such Collateral are
to be made directly to the Administrative Agent.
5.02 Other Financing Statements and Liens. Except as otherwise
permitted under Section 7.02 of the Credit Agreement, without the prior written
consent of the Administrative Agent (granted with the authorization of the
Lenders as specified in Section 10.02(c) of the Credit Agreement), no Obligor
shall file or suffer to be on file, or authorize or permit to be filed or to be
on file, in any jurisdiction, any financing statement or like instrument with
respect to the Collateral in which the Administrative Agent is not named as the
sole secured party for the benefit of the Lenders.
5.03 Preservation of Rights. The Administrative Agent shall not be
required to take steps necessary to preserve any rights against prior parties to
any of the Collateral.
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5.04 Special Provisions Relating to Certain Collateral.
(a) Stock Collateral.
(1) The Obligors will cause (A) the Stock Collateral to constitute
at all times (i) except as provided in clause (ii) below, 100% of the total
number of shares of each class of capital stock of each Issuer then outstanding
and owned by the Obligors and (ii) in the case of any Foreign Subsidiary which
is an Issuer hereunder, 65% of the total number of shares of voting capital
stock of such Foreign Subsidiary having ordinary voting power for the election
of the board of directors (or similar body) and 100% of each class of all other
capital stock of such Foreign Subsidiary and (B) the Pledged Interests to
constitute 100% of the aggregate ownership interests of each Other Issuer then
outstanding and owned by the Obligors.
(2) So long as no Event of Default shall have occurred and be
continuing, the Obligors shall have the right to exercise all voting, consensual
and other powers of ownership pertaining to the Stock Collateral for all
purposes not inconsistent with the terms of this Agreement, the Credit Agreement
or any other instrument or agreement referred to herein, provided that the
Obligors jointly and severally agree that they will not vote the Stock
Collateral in any manner that is inconsistent with the terms of this Agreement,
the Credit Agreement or any such other instrument or agreement; and the
Administrative Agent shall execute and deliver to the Obligors or cause to be
executed and delivered to the Obligors all such proxies, powers of attorney,
dividend and other orders, and all such instruments, without recourse, as the
Obligors may reasonably request for the purpose of enabling the Obligors to
exercise the rights and powers that they are entitled to exercise pursuant to
this Section 5.04(a)(2).
(3) Unless and until an Event of Default has occurred and is
continuing, the Obligors shall be entitled to receive and retain any dividends
on the Stock Collateral paid in cash out of earned surplus.
(4) If any Event of Default shall have occurred, then so long as
such Event of Default shall continue, and whether or not the Administrative
Agent or any Lender exercises any available right to declare any Secured
Obligation due and payable or seeks or pursues any other relief or remedy
available to it under applicable law or under this Agreement, the Credit
Agreement or any other agreement relating to such Secured Obligation, all
dividends and other distributions on the Stock Collateral shall be paid directly
to the Administrative Agent and retained by it in the Collateral Account as part
of the Stock Collateral, subject to the terms of this Agreement, and, if the
Administrative Agent shall so request in writing, the Obligors jointly and
severally agree to execute and deliver to the Administrative Agent appropriate
additional dividend, distribution and other orders and documents to that end,
provided that if such Event of Default is cured or waived, any such dividend or
distribution theretofore paid to the
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<PAGE>
-15-
Administrative Agent shall, upon request of the Obligors (except to the extent
theretofore applied to the Secured Obligations), be returned by the
Administrative Agent to the Obligors.
(b) Intellectual Property.
(1) For the purpose of enabling the Administrative Agent to exercise
rights and remedies under Section 5.05 at such time as the Administrative Agent
shall be lawfully entitled to exercise such rights and remedies, and for no
other purpose, each Obligor hereby grants to the Administrative Agent, to the
extent assignable, an irrevocable, non-exclusive license (exercisable without
payment of royalty or other compensation to such Obligor) to use, assign,
license or sublicense any of the Intellectual Property now owned or hereafter
acquired by such Obligor, wherever the same may be located, including in such
license reasonable access to all media in which any of the licensed items may be
recorded or stored and to all computer programs used for the compilation or
printout thereof.
(2) Notwithstanding anything contained herein to the contrary, but
subject to the provisions of Section 7.03 of the Credit Agreement that limit the
rights of the Obligors to dispose of their property, so long as no Event of
Default shall have occurred and be continuing, the Obligors will be permitted to
exploit, use, enjoy, protect, license, sublicense, assign, sell, dispose of or
take other actions with respect to the Intellectual Property in the ordinary
course of the business of the Obligors. In furtherance of the foregoing, unless
an Event of Default shall have occurred and be continuing the Administrative
Agent shall from time to time, upon the request of the respective Obligor,
execute and deliver any instruments, certificates or other documents, in the
form so requested, that such Obligor through the Borrower shall have certified
are appropriate (in its judgment) to allow it to take any action permitted above
(including relinquishment of the license provided pursuant to clause (1)
immediately above as to any specific Intellectual Property). Further, upon the
payment in full of all of the Secured Obligations and cancellation or
termination of the Commitments and LC Exposure or earlier expiration of this
Agreement or release of the Collateral, the Administrative Agent shall grant
back to the Obligors the license granted pursuant to clause (1) immediately
above. The exercise of rights and remedies under Section 5.05 by the
Administrative Agent shall not terminate the rights of the holders of any
licenses or sublicenses theretofore granted by the Obligors in accordance with
the first sentence of this clause (2).
(c) Motor Vehicles. At any time after the occurrence and during the
continuance of an Event of Default, each Obligor shall, upon the request of the
Administrative Agent, deliver to the Administrative Agent originals of the
certificates of title or ownership for the Motor Vehicles owned by it with the
Administrative Agent listed as lienholder and take such other action as the
Administrative Agent shall deem appropriate to perfect the security interest
created hereunder in all such Motor Vehicles.
Security Agreement
<PAGE>
-16-
5.05 Events of Default, Etc. During the period during which an Event
of Default shall have occurred and be continuing:
(a) each Obligor shall, at the request of the Administrative Agent,
assemble the Collateral owned by it at such place or places, reasonably
convenient to both the Administrative Agent and such Obligor, designated
in its request;
(b) the Administrative Agent may make any reasonable compromise or
settlement deemed desirable with respect to any of the Collateral and may
extend the time of payment, arrange for payment in installments, or
otherwise modify the terms of, any of the Collateral;
(c) the Administrative Agent shall have all of the rights and
remedies with respect to the Collateral of a secured party under the
Uniform Commercial Code (whether or not said Code is in effect in the
jurisdiction where the rights and remedies are asserted) and such
additional rights and remedies to which a secured party is entitled under
the laws in effect in any jurisdiction where any rights and remedies
hereunder may be asserted, including, without limitation, the right, to
the maximum extent permitted by law, to exercise all voting, consensual
and other powers of ownership pertaining to the Collateral as if the
Administrative Agent were the sole and absolute owner thereof (and each
Obligor agrees to take all such action as may be appropriate to give
effect to such right);
(d) the Administrative Agent in its discretion may, in its name or
in the name of the Obligors or otherwise, demand, sue for, collect or
receive any money or property at any time payable or receivable on account
of or in exchange for any of the Collateral, but shall be under no
obligation to do so; and
(e) the Administrative Agent may, upon ten Business Days' prior
written notice to the Obligors of the time and place, with respect to the
Collateral or any part thereof that shall then be or shall thereafter come
into the possession, custody or control of the Administrative Agent, the
Lenders or any of their respective agents, sell, lease, assign or
otherwise dispose of all or any part of such Collateral, at such place or
places as the Administrative Agent deems best, and for cash or for credit
or for future delivery (without thereby assuming any credit risk), at
public or private sale, without demand of performance or notice of
intention to effect any such disposition or of the time or place thereof
(except such notice as is required above or by applicable statute and
cannot be waived), and the Administrative Agent or any Lender or anyone
else may be the purchaser, lessee, assignee or recipient of any or all of
the Collateral so disposed of at any public sale (or, to the extent
permitted by law, at any private sale) and thereafter hold the same
absolutely, free from any claim or right of whatsoever kind, including any
right or
Security Agreement
<PAGE>
-17-
equity of redemption (statutory or otherwise), of the Obligors, any such
demand, notice and right or equity being hereby expressly waived and
released. In the event of any sale, assignment, or other disposition of
any of the Trademark Collateral, the goodwill connected with and
symbolized by the Trademark Collateral subject to such disposition shall
be included, and the Obligors shall supply to the Administrative Agent or
its designee, for inclusion in such sale, assignment or other disposition,
all Intellectual Property relating to such Trademark Collateral. The
Administrative Agent may, without notice or publication, adjourn any
public or private sale or cause the same to be adjourned from time to time
by announcement at the time and place fixed for the sale, and such sale
may be made at any time or place to which the sale may be so adjourned.
The proceeds of each collection, sale or other disposition under this Section
5.05, including by virtue of the exercise of the license granted to the
Administrative Agent in Section 5.04(b), shall be applied in accordance with
Section 5.09.
The Obligors recognize that, by reason of certain prohibitions
contained in the Securities Act of 1933, as amended, and applicable state
securities laws, the Administrative Agent may be compelled, with respect to any
sale of all or any part of the Collateral, to limit purchasers to those who will
agree, among other things, to acquire the Collateral for their own account, for
investment and not with a view to the distribution or resale thereof. The
Obligors acknowledge that any such private sales may be at prices and on terms
less favorable to the Administrative Agent than those obtainable through a
public sale without such restrictions, and, notwithstanding such circumstances,
agree that any such private sale shall be deemed to have been made in a
commercially reasonable manner and that the Administrative Agent shall have no
obligation to engage in public sales and no obligation to delay the sale of any
Collateral for the period of time necessary to permit the respective Issuer or
issuer thereof to register it for public sale.
5.06 Deficiency. If the proceeds of sale, collection or other
realization of or upon the Collateral pursuant to Section 5.05 are insufficient
to cover the costs and expenses of such realization and the payment in full of
the Secured Obligations, the Obligors shall remain liable for any deficiency to
the extent the Obligors are obligated under this Agreement.
5.07 Removals, Etc. Without at least 20 days' prior written notice
to the Administrative Agent, no Obligor shall (i) maintain any of its books and
records with respect to the Collateral at any office, or maintain its principal
place of business at any place, or permit any Inventory or Equipment to be
located anywhere, other than at the address indicated beneath the signature of
the Borrower to the Credit Agreement or at one of the locations identified in
Annex 6 under its name or in transit from one of such locations to another or
(ii) change its name, or the name under which it does business, from the name
shown on the signature pages hereto.
Security Agreement
<PAGE>
-18-
5.08 Private Sale. The Administrative Agent and the Lenders shall
incur no liability as a result of the sale of the Collateral, or any part
thereof, at any private sale pursuant to Section 5.05 conducted in a
commercially reasonable manner. Each Obligor hereby waives any claims against
the Administrative Agent or any Lender arising by reason of the fact that the
price at which the Collateral may have been sold at such a private sale was less
than the price that might have been obtained at a public sale or was less than
the aggregate amount of the Secured Obligations, even if the Administrative
Agent accepts the first offer received and does not offer the Collateral to more
than one offeree.
5.09 Application of Proceeds. Except as otherwise herein expressly
provided and except as provided below in this Section 5.09, the proceeds of any
collection, sale or other realization of all or any part of the Collateral
pursuant hereto, and any other cash at the time held by the Administrative Agent
under Section 4 or this Section 5, shall be applied by the Administrative Agent:
First, to the payment of the costs and expenses of such collection,
sale or other realization, including reasonable out-of-pocket costs and
expenses of the Administrative Agent and the fees and expenses of its
agents and counsel, and all expenses incurred and advances made by the
Administrative Agent in connection therewith;
Next, to the payment in full of the Secured Obligations, in each
case equally and ratably in accordance with the respective amounts thereof
then due and owing or as the Lenders holding the same may otherwise agree;
and
Finally, to the payment to the respective Obligor, or their
respective successors or assigns, or as a court of competent jurisdiction
may direct, of any surplus then remaining.
Notwithstanding the foregoing, the proceeds of any cash or other amounts held in
the "LC Exposure Sub-Account" of the Collateral Account pursuant to Section 4.05
shall be applied first to the LC Exposure outstanding from time to time and
second to the other Secured Obligations in the manner provided above in this
Section 5.09.
As used in this Section 5, "proceeds" of Collateral means cash,
securities and other property realized in respect of, and distributions in kind
of, Collateral, including any thereof received under any reorganization,
liquidation or adjustment of debt of the Obligors or any issuer of or obligor on
any of the Collateral.
5.10 Attorney-in-Fact. Without limiting any rights or powers granted
by this Agreement to the Administrative Agent while no Event of Default has
occurred and is continuing, upon the occurrence and during the continuance of
any Event of Default the
Security Agreement
<PAGE>
-19-
Administrative Agent is hereby appointed the attorney-in-fact of each Obligor
for the purpose of carrying out the provisions of this Section 5 and taking any
action and executing any instruments that the Administrative Agent may deem
necessary or advisable to accomplish the purposes hereof, which appointment as
attorney-in-fact is irrevocable and coupled with an interest. Without limiting
the generality of the foregoing, so long as the Administrative Agent shall be
entitled under this Section 5 to make collections in respect of the Collateral,
the Administrative Agent shall have the right and power to receive, endorse and
collect all checks made payable to the order of any Obligor representing any
dividend, payment or other distribution in respect of the Collateral or any part
thereof and to give full discharge for the same.
5.11 Perfection. Prior to or concurrently with the execution and
delivery of this Agreement, each Obligor shall (i) file such financing
statements and other documents in such offices as the Administrative Agent may
reasonably request to perfect the security interests granted by Section 3 of
this Agreement, (ii) cause the Administrative Agent to be listed as the
lienholder on all certificates of title or ownership relating to Motor Vehicles
owned by such Obligor and (iii) deliver to the Administrative Agent all
certificates identified in Annex 1, accompanied by undated stock powers duly
executed in blank.
5.12 Termination. When all Secured Obligations shall have been paid
in full and the Commitments of the Lenders under the Credit Agreement and all LC
Exposure shall have expired or been terminated, this Agreement shall terminate,
and the Administrative Agent shall forthwith cause to be assigned, transferred
and delivered, against receipt but without any recourse, warranty or
representation whatsoever, any remaining Collateral and money received in
respect thereof, to or on the order of the respective Obligor and to be released
and canceled all licenses and rights referred to in Section 5.04(b). The
Administrative Agent shall also execute and deliver to the respective Obligor
upon such termination such Uniform Commercial Code termination statements,
certificates for terminating the Liens on the Motor Vehicles and such other
documentation as shall be reasonably requested by the respective Obligor to
effect the termination and release of the Liens on the Collateral.
5.13 Further Assurances. Each Obligor agrees that, from time to time
upon the written request of the Administrative Agent, such Obligor will execute
and deliver such further documents and do such other acts and things as the
Administrative Agent may reasonably request in order fully to effect the
purposes of this Agreement.
5.14 Release of Motor Vehicles. So long as no Default shall have
occurred and be continuing, upon the request of any Obligor, the Administrative
Agent shall execute and deliver to such Obligor such instruments as such Obligor
shall reasonably request to remove the notation of the Administrative Agent as
lienholder on any certificate of title for any Motor Vehicle; provided that any
such instruments shall be delivered, and the release effective only upon receipt
by the Administrative Agent of a certificate from such Obligor stating that the
Security Agreement
<PAGE>
-20-
Motor Vehicle the lien on which is to be released is to be sold or has suffered
a casualty loss (with title thereto passing to the casualty insurance company
therefor in settlement of the claim for such loss).
Section 6. Miscellaneous.
6.01 Notices. All notices, requests, consents and demands hereunder
shall be in writing and telecopied or delivered to the intended recipient at its
"Address for Notices" specified pursuant to Section 10.01 of the Credit
Agreement and shall be deemed to have been given at the times specified in said
Section 10.01.
6.02 No Waiver. No failure on the part of the Administrative Agent
or any Lender to exercise, and no course of dealing with respect to, and no
delay in exercising, any right, power or remedy hereunder shall operate as a
waiver thereof; nor shall any single or partial exercise by the Administrative
Agent or any Lender of any right, power or remedy hereunder preclude any other
or further exercise thereof or the exercise of any other right, power or remedy.
The remedies herein are cumulative and are not exclusive of any remedies
provided by law.
6.03 Amendments, Etc. The terms of this Agreement may be waived,
altered or amended only by an instrument in writing duly executed by each
Obligor and the Administrative Agent (with the consent of the Lenders as
specified in Section 10.02(c) of the Credit Agreement). Any such amendment or
waiver shall be binding upon the Administrative Agent and each Lender, each
holder of any of the Secured Obligations and each Obligor.
6.04 Expenses. The Obligors jointly and severally agree to reimburse
each of the Lenders and the Administrative Agent for all reasonable costs and
expenses of the Lenders and the Administrative Agent (including, without
limitation, the reasonable fees and expenses of legal counsel) in connection
with (i) any Default and any enforcement or collection proceeding resulting
therefrom, including, without limitation, all manner of participation in or
other involvement with (w) performance by the Administrative Agent of any
obligations of the Obligors in respect of the Collateral that the Obligors have
failed or refused to perform, (x) bankruptcy, insolvency, receivership,
foreclosure, winding up or liquidation proceedings, or any actual or attempted
sale, or any exchange, enforcement, collection, compromise or settlement in
respect of any of the Collateral, and for the care of the Collateral and
defending or asserting rights and claims of the Administrative Agent in respect
thereof, by litigation or otherwise, including expenses of insurance, (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 6.04, and all such costs and expenses shall be Secured Obligations
entitled to the benefits of the collateral security provided pursuant to Section
3.
Security Agreement
<PAGE>
-21-
6.05 Successors and Assigns. This Agreement shall be binding upon
and inure to the benefit of the respective successors and assigns of each
Obligor, the Administrative Agent, the Lenders and each holder of any of the
Secured Obligations (provided, however, that no Obligor shall assign or transfer
its rights hereunder without the prior written consent of the Administrative
Agent).
6.06 Counterparts. This Agreement may be executed in any number of
counterparts, all of which taken together shall constitute one and the same
instrument and any of the parties hereto may execute this Agreement by signing
any such counterpart.
6.07 Governing Law. This Agreement shall be governed by, and
construed in accordance with, the law of the State of New York.
6.08 Captions. The captions and section headings appearing herein
are included solely for convenience of reference and are not intended to affect
the interpretation of any provision of this Agreement.
6.09 Agents and Attorneys-in-Fact. The Administrative Agent may
employ agents and attorneys-in-fact in connection herewith and shall not be
responsible for the negligence or misconduct of any such agents or
attorneys-in-fact selected by it in good faith.
6.10 Severability. If any provision hereof is invalid and
unenforceable in any jurisdiction, then, to the fullest extent permitted by law,
(a) the other provisions hereof shall remain in full force and effect in such
jurisdiction and shall be liberally construed in favor of the Administrative
Agent and the Lenders in order to carry out the intentions of the parties hereto
as nearly as may be possible and (b) the invalidity or unenforceability of any
provision hereof in any jurisdiction shall not affect the validity or
enforceability of such provision in any other jurisdiction.
6.11 Additional Obligors. As contemplated in Section 6.10 of the
Credit Agreement, a new Subsidiary of the Borrower formed or acquired by the
Borrower after the date hereof may become a "Subsidiary Guarantor" under the
Credit Agreement and an "Obligor" under this Agreement, by executing and
delivering to the Administrative Agent a Guarantee Assumption Agreement in the
form of Exhibit D to the Credit Agreement. Accordingly, upon the execution and
delivery of any such Guarantee Assumption Agreement by any such Subsidiary, such
new Subsidiary shall automatically and immediately, and without any further
action on the part of any Person, become an "Obligor" for all purposes of this
Agreement, and each of the Annexes hereto shall be supplemented in the manner
specified in such Guarantee Assumption Agreement.
Security Agreement
<PAGE>
-22-
IN WITNESS WHEREOF, the parties hereto have caused this Security
Agreement to be duly executed and delivered as of the day and year first above
written.
CHART INDUSTRIES, INC.
By ________________________
Name:
Title:
Security Agreement
<PAGE>
-23-
SUBSIDIARY GUARANTORS
ALTEC, INC.
By ________________________
Name:
Title:
ALTEC INTERNATIONAL LIMITED
PARTNERSHIP
By: CHART MANAGEMENT COMPANY, INC.,
its sole general partner
By ________________________
Name:
Title:
CHART INDUSTRIES FOREIGN SALES
CORPORATION
By ________________________
Name:
Title:
CHART INTERNATIONAL, INC.
By ________________________
Name:
Title:
Security Agreement
<PAGE>
-24-
CHART MANAGEMENT COMPANY, INC.
By ________________________
Name:
Title:
CRYENCO, INC.
By ________________________
Name:
Title:
CRYENCO SCIENCES, INC.
By ________________________
Name:
Title:
GREENVILLE TUBE CORPORATION
By ________________________
Name:
Title:
PROCESS SYSTEMS INTERNATIONAL, INC.
By ________________________
Name:
Title:
Security Agreement
<PAGE>
-25-
NCI SALES AND LEASING, INC.
By ________________________
Name:
Title:
NORTHCOAST ACQUISITION CORP.
By ________________________
Name:
Title:
NORTHCOAST OF AMERICA CRYOGENIC INC.
By ________________________
Name:
Title:
MVE HOLDINGS, INC.
By ________________________
Name:
Title:
Security Agreement
<PAGE>
-26-
THE CHASE MANHATTAN BANK,
as Administrative Agent
By ________________________
Title:
Security Agreement
<PAGE>
ANNEX 1
PLEDGED STOCK
[See Section 2(b) and (c).]
Part A
Part B
Annex 1 to Security Agreement
<PAGE>
ANNEX 2
LIST OF COPYRIGHTS, COPYRIGHT REGISTRATIONS AND
APPLICATIONS FOR COPYRIGHT REGISTRATIONS
[See Section 2(d).]
[Complete for each Obligor:]
[NAME OF OBLIGOR]
Title Date Filed Registration No. Effective Date
- ----- ---------- ---------------- --------------
Annex 2 to Security Agreement
<PAGE>
ANNEX 3
LIST OF PATENTS AND PATENT APPLICATIONS
[See Section 2(d).]
[Complete for each Obligor:]
[NAME OF OBLIGOR]
File Patent Country Registration No. Date
- ---- ------ ------- ---------------- ----
Annex 3 to Security Agreement
<PAGE>
ANNEX 4
LIST OF TRADE NAMES, TRADEMARKS, SERVICES MARKS,
TRADEMARK AND SERVICE MARK REGISTRATIONS AND
APPLICATIONS FOR TRADEMARK AND SERVICE MARK REGISTRATIONS
[See Section 2(d).]
U.S. Trademarks
[Complete for each Obligor:]
[NAME OF OBLIGOR]
Application (A)
Registration (R) Registration
Mark or Series No. (S) or Filing Date
---- ----------------- --------------
Annex 4 to Security Agreement
<PAGE>
-2-
Foreign Trademarks
[Complete for each Obligor]
[NAME OF OBLIGOR]
Application (A) Registration or
Mark Registration (R) Country Filing Date (F)
---- ---------------- ------- ---------------
Annex 4 to Security Agreement
<PAGE>
ANNEX 5
LIST OF CONTRACTS, LICENSES AND OTHER AGREEMENTS
[See Section 2(d), (e) and (f).]
[Complete for each Obligor:]
[NAME OF OBLIGOR]
Annex 5 to Security Agreement
<PAGE>
ANNEX 6
LIST OF LOCATIONS
[See Section 5.07.]
[Complete for each Obligor:]
[NAME OF OBLIGOR]
Annex 6 to Security Agreement
<PAGE>
ANNEX 7
CONCENTRATION ACCOUNT
[See Section 4.02]
Annex 7 to Security Agreement
<PAGE>
EXHIBIT C
[Form of Mortgage]
Form of Mortgage
<PAGE>
EXHIBIT D
[Form of Guarantee Assumption Agreement]
GUARANTEE ASSUMPTION AGREEMENT
GUARANTEE ASSUMPTION AGREEMENT dated as of ________ __, ____ by
[NAME OF ADDITIONAL SUBSIDIARY GUARANTOR], a ________ corporation (the
"Additional Subsidiary Guarantor"), in favor of The Chase Manhattan Bank, as
administrative agent for the lenders or other financial institutions or entities
party as "Lenders" to the Credit Agreement referred to below (in such capacity,
together with its successors in such capacity, the "Administrative Agent").
Chart Industries, Inc., a Delaware corporation, the Subsidiary
Borrowers referred to therein, the Subsidiary Guarantors referred to therein,
the Lenders party thereto, the Administrative Agent and National City Bank, as
Documentation Agent, are parties to a Credit Agreement dated as of April 12,
1999 (as modified and supplemented and in effect from time to time, the "Credit
Agreement"). Terms defined in the Credit Agreement are used herein with the same
meanings.
Pursuant to Section 6.10(a) of the Credit Agreement, the Additional
Subsidiary Guarantor hereby agrees to become a "Subsidiary Guarantor" for all
purposes of the Credit Agreement, and an "Obligor" and an "Issuer" for all
purposes of the Security Agreement (and hereby supplements Annexes 1 through 6
to said Security Agreement as specified in Appendix A). Without limiting the
foregoing, the Additional Subsidiary Guarantor hereby, jointly and severally
with the other Subsidiary Guarantors, guarantees to each Lender and the
Administrative Agent and their respective successors and assigns the prompt
payment in full when due (whether at stated maturity, by acceleration or
otherwise) of all Guaranteed Obligations (as defined in Section 3.01(b) of the
Credit Agreement) in the same manner and to the same extent as is provided in
Article III of the Credit Agreement. In addition, the Additional Subsidiary
Guarantor hereby makes the representations and warranties set forth in Sections
4.01, 4.02 and 4.03 of the Credit Agreement, and in Section 2 of the Security
Agreement, with respect to itself and its obligations under this Agreement, as
if each reference in such Sections to the Credit Documents included reference to
this Agreement.
The Additional Subsidiary Guarantor hereby instructs its counsel to
deliver the opinions referred to in Section 6.10(a) of the Credit Agreement to
the Lenders and the Administrative Agent.
Guarantee Assumption Agreement
<PAGE>
-2-
IN WITNESS WHEREOF, the Additional Subsidiary Guarantor has caused
this Guarantee Assumption Agreement to be duly executed and delivered as of the
day and year first above written.
[NAME OF ADDITIONAL SUBSIDIARY
GUARANTOR]
By ________________________
Title:
Accepted and agreed:
THE CHASE MANHATTAN BANK,
as Administrative Agent
By ________________________
Title:
Guarantee Assumption Agreement
<PAGE>
Appendix A
SUPPLEMENTS TO ANNEXES TO SECURITY AGREEMENT
Supplement to Annex 1:
[to be completed]
Supplement to Annex 2:
[to be completed]
Supplement to Annex 3:
[to be completed]
Supplement to Annex 4:
[to be completed]
Supplement to Annex 5:
[to be completed]
Supplement to Annex 6:
[to be completed]
Appendix A to Guarantee Assumption Agreement
<PAGE>
INDEMNIFICATION AND WARRANT PURCHASE AGREEMENT
INDEMNIFICATION AND WARRANT PURCHASE AGREEMENT (the "Agreement"),
dated as of April 12, 1999, among Chart Industries, Inc., a Delaware
corporation ("Chart"), MVE Holdings, Inc., a Delaware corporation ("Holdings")
and each of the former members of MVE Investors, LLC listed on the signature
pages hereto (the "Members").
W I T N E S S E T H:
WHEREAS, Chart, Chart Acquisition Company, a Delaware corporation
("Sub"), and Holdings have entered into an Agreement and Plan of Merger, dated
February 16, 1999, whereby Sub will merge with and into Holdings (the "Merger
Agreement"; capitalized terms used herein but not defined shall have the
meanings ascribed to such terms in the Merger Agreement) (except that as used
herein the term "Holdings" shall include the "Surviving Corporation" of the
Merger);
WHEREAS, Chart has deposited certain amounts into escrow, which
amounts may be utilized as provided herein by the Members.
WHEREAS, Chart, Holdings and the Members desire to memorialize their
understanding that Damages arising out of Misallocation Claims and Powell Claims
(collectively, "Indemnifiable Claims") shall be satisfied first from insurance
proceeds, if any, second from the Holdback Amount and third, to the extent any
insurance proceeds and the Holdback Amount are not sufficient to satisfy all
Damages arising out of such claims (i) with respect to Misallocation Claims,
from the parties hereto according to the following percentages: (a) 90% by the
Members and (b) 10% by Chart and Holdings and (ii) with respect to Powell
Claims, 100% by the Members.
WHEREAS, Chart and Holdings, on the one hand, and the Members, on
the other hand, desire to indemnify each other for their proportionate share of
Damages, if any, arising out of Misallocation Claims and the Members desire to
indemnify Chart and Holdings for Damages arising out of Powell Claims; and
WHEREAS, Chart desires to grant to the Members the option to
purchase warrants to purchase up to 1,000,000 shares of common stock of Chart on
the terms and subject to the conditions set forth in this Agreement in
consideration of the Members' agreement to provide indemnification to Chart and
Holdings as provided herein.
<PAGE>
NOW, THEREFORE, in consideration of the foregoing and the covenants
and agreements herein contained, and for other good and lawful consideration,
the receipt and sufficiency of which is hereby acknowledged, the parties hereto
agree as follows:
ARTICLE I.
INDEMNIFICATION AND RELATED MATTERS
I.01 Insurance Proceeds. Chart and Holdings agree to use
commercially reasonable efforts (including without limitation, complying with
the terms of the Merger Agreement) to cause any Damages for Indemnifiable Claims
which may be covered by third party insurance to be paid by any such third party
insurance carrier.
I.02 Holdback Amount. To the extent not paid in full with insurance
proceeds, all Damages for Indemnifiable Claims shall be paid out of the Holdback
Amount pursuant to the Merger Agreement and the Escrow Agreement, but only if
and to the extent the Members consent to the release of such funds in accordance
with the terms set forth in the Escrow Agreement.
I.03 Escrow Amount. Chart or the Company shall deposit in a separate
escrow account an amount in cash equal to (a) the accrued but unpaid dividends
on 576.76 shares of 10% Class B Cumulative Preferred Stock, par value $100.00
per share, of the Company, plus (b) any amounts recovered by the Company in
respect of certain rights assigned to it to collect indemnification payments
with respect to certain tax issues under that certain Agreement, dated August
27, 1996 among Robert E. Cieslukowski, Cieslukowski Family Limited Partnership,
C.J. Schoenbauer, H. Michael Lutgen, R. Edwin Powell, Powell Family Limited
Partnership, John J. Pint, Michael Tate, JMS Family Limited Partnership and
O'Halloran Family Limited Partnership, which collection rights have been
assigned to the Company pursuant to a letter agreement, dated February 11, 1999,
among MVE Inc. and Messrs. Clemence J. Schoenbauer and H. Michael Lutgen minus
(c) $296,035 (collectively, the "Escrow Amount"). The Members may, in their sole
and absolute discretion, at any time and from time to time, utilize all or any
portion of the Escrow Amount (a) to defend, settle or pay any Powell Claims, (b)
to satisfy their indemnification obligation arising under Section 1.06 hereof,
(c) to pay any or all of the purchase price of the Warrants (as defined in
Section 2.01), (d) to pay a bonus to any current or former officer of Holdings
or MVE, Inc., (e) to pay the fees and expenses of any Affiliate of the Members
including, without limitation, investment banking fees of
2
<PAGE>
ACI Capital Co., Inc., or its Affiliates or (f) in any other manner as the
Members, in their sole and absolute discretion, may from time to time determine;
provided, however, that the Members may only utilize the Escrow Amount for the
purposes described in clauses (a) and (b) above until such time as the Members'
indemnification obligations under Section 1.06 hereof terminate.
I.04 Liability of Chart, Holdings and the Members. To the extent any
Damages for Indemnifiable Claims are not paid out of insurance proceeds and to
the extent that such Damages are not paid out of the Holdback Amount or the
Escrow Amount, then such Damages in excess of any amounts actually paid by
Chart's or Holdings' insurance carriers and any amounts released from the
Holdback Amount or the Escrow Amount shall, pursuant to Sections 1.05 and 1.06
hereof, (a) with respect to Misallocation Claims be borne 90% by the Members and
10% by Chart and Holdings and (b) with respect to Powell Claims be borne 100% by
the Members.
I.05 Indemnification of the Members by Chart and Holdings. Chart and
Holdings shall, jointly and severally, indemnify, defend and hold the Members
and their respective directors, officers and Affiliates ("Member Indemnitees")
harmless from and against ten percent (10%) of any and all Damages, other than
Damages satisfied out of insurance proceeds pursuant to Section 1.01, Damages
satisfied out of the Holdback Amount pursuant to Section 1.02 or Damages
satisfied out of the Escrow Amount pursuant to Section 1.03, incurred or
suffered by any Member Indemnitee arising out of or in connection with any
Misallocation Claim.
I.06 Indemnification of Chart and Holdings by the Members. The
Members shall, jointly and severally (but if any Member deposits one-third of
its Class A Merger Consideration in an escrow account established for the
purpose of satisfying claims by any Chart Indemnitees (as hereinafter defined)
for Damages hereunder, the terms of which escrow are reasonably satisfactory to
Chart and Holdings, then to the extent such funds remain in escrow, such
Member's liability hereunder shall be several but not joint), indemnify, defend
and hold Chart and Holdings and their respective directors, officers and
Affiliates ("Chart Indemnitees") harmless from and against (a) ninety percent
(90%) of any and all Damages, other than Damages satisfied out of insurance
proceeds pursuant to Section 1.01, Damages satisfied out of the Holdback Amount
pursuant to Section 1.02, and Damages satisfied out of the Escrow Amount
pursuant to Section 1.03, incurred or suffered by a Chart Indemnitee arising out
of or in connection with any Misallocation Claim and (b) one hundred percent
(100%) of any and all Damages, other than Damages satisfied out of insurance
proceeds pursuant to Section 1.01, Damages satisfied out of the Holdback Amount
pursuant to Section 1.02 and Damages satisfied out of the Escrow Amount pursuant
to Section 1.03, incurred or
3
<PAGE>
suffered by any Chart Indemnitee arising out of or in connection with the Powell
Claims. The obligation of the Members to provide indemnification to Chart and
Holdings hereunder with respect to Misallocation Claims shall terminate (except
with respect to any claim for which a Claim Notice (as defined below) has been
provided) on the second anniversary of the Effective Time. The obligation of the
Members to provide indemnification to the Chart Indemnitees hereunder with
respect to Powell Claims shall terminate at the earliest time that (a) the
Powell Claims shall have been dismissed with prejudice pursuant to a settlement
agreement or otherwise, (b) the parties to the Powell Claims shall have reached
a settlement agreement reasonably satisfactory to Chart or (c) a court of
competent jurisdiction shall have issued a final judgment with respect to the
Powell Claims which is not subject to appeal, or if subject to appeal, the
applicable appeal period shall have lapsed, and such judgment shall have been
satisfied in full.
I.07 Limitations on Liability. Notwithstanding anything herein to
the contrary, the Members shall not be liable (a) for any Damages with respect
to Misallocation Claims and Powell Claims, in the aggregate, in excess of the
accrued but unpaid dividends on the 12 1/2% Class A Cumulative Convertible
Participating Preferred Stock, par value $100 per share, of the Company,
immediately prior to the Effective Time (the "Aggregate Cap") and (b) for any
Damages with respect to Powell Claims only, in excess of $5,000,000 (the "Powell
Cap"); provided, however, that (i) from and after the date which is six months
from the date hereof, if there are no Misallocation Claims outstanding, the
Aggregate Cap shall be reduced to $13,000,000 and (ii) on and after the first
anniversary of the date hereof, the Aggregate Cap shall be reduced at that time
and from time to time by an amount equal to $100 multiplied by the number of
shares of Common Stock held by former holders of Common Stock who have at any
time executed releases in the form of Exhibit A hereto; provided, further,
however, that as long as any Powell Claims remain outstanding, the Aggregate Cap
shall not be reduced below the Powell Cap.
I.08 Indemnification Claims. (a) If an indemnified party hereunder
(the "Claimant") wishes to assert an indemnification claim against another party
hereto, the Claimant shall deliver to the indemnifying party not later than the
second anniversary of the Effective Time a written notice (a "Claim Notice")
setting forth:
(i) a description of the facts and circumstances giving rise to the
right to receive indemnification hereunder; and
(ii) a description and a good faith estimate of the total amount of
4
<PAGE>
Damages actually incurred or expected to be incurred by the Claimant
(which estimate shall not operate as a limit on any indemnification
claim).
(b) Each of (i) the Members and (ii) Chart and Holdings agrees
to provide notice to the other of any information regarding threatened or
pending claims.
I.09 Defense of Indemnifiable Claims. Subject to the Members' prior
delivery to Chart and Holdings of a written acknowledgement that a claim
constitutes an Indemnifiable Claim for which the Members are responsible (in
whole or in part) pursuant to Section 1.06 of this Agreement, the Members shall
have the sole and exclusive right to assume the defense of any Indemnifiable
Claims. During any such defense:
(a) Chart and Holdings shall make available to the Members all
books, records and other documents and materials that are under the direct
or indirect control of Chart or Holdings or any of their representatives
and that the Members reasonably consider necessary or desirable for the
defense of any such Indemnifiable Claim;
(b) Chart and Holdings shall execute such documents and take such
other actions as the Members may reasonably request for the purpose of
facilitating the defense of, or any settlement, compromise or adjustment
relating to, any Indemnifiable Claim;
(c) Chart and Holdings shall otherwise fully cooperate as reasonably
requested by the Members in the defense of any Indemnifiable Claim; and
(d) The Members shall have the exclusive right to settle, adjust or
compromise any Indemnifiable Claim, on such terms as they, in their sole
and absolute discretion, deem appropriate, without the consent or approval
of Chart or Holdings; provided, however, that if Chart or Holdings are
parties to such settlement, adjustment or compromise, such settlement,
adjustment or compromise shall include a complete release of the Chart
Indemnitees on terms reasonably satisfactory to Chart; provided, further,
that such settlement, adjustment or compromise shall not require Chart or
Holdings to refrain from taking any action in the future or otherwise
provide for injunctive relief against Chart or Holdings.
1.10 Representation of the Members. The Members hereby jointly and
5
<PAGE>
severally represent and warrant to Chart and Holdings that (i) the Members
collectively owned all of the membership interests of MVE Investors during the
period of time from January 1, 1999 until immediately prior to the consummation
of the merger of MVE Investors with and into Sub, and (ii) the aggregate net
worth of the Members as of the date of this Agreement is not less than
$50,000,000.
1.11 Powell Offset. The amount payable in Section 1.06 hereof by the
Members in respect to Powell Claims shall be reduced by any amounts received by
the Chart Indemnitees in respect of potential claims against R. Edwin Powell,
the R. Edwin Powell Family Limited Partnership and the partners thereof, and
their representatives and professional service providers. In the event such
amounts recovered exceed the amount of the Powell Claims, such excess amount
shall be allocated and shall be distributed 90% to the Members and 10% to Chart
and Holdings
ARTICLE II.
OPTION TO PURCHASE WARRANTS
II.01 Option to Purchase Warrants. In consideration of the Members'
agreement to provide indemnification to Chart and Holdings hereunder, Chart
hereby grants to the Members the right to purchase from Chart, which right to
purchase is exercisable by the Members in whole or in part, in their sole and
absolute discretion, at any time after the date hereof and prior to the date
which is five years from the date hereof (the "Purchase Period"), warrants to
purchase an aggregate of 1,000,000 shares of common stock, par value $.01, of
Chart (the "Warrants"), pursuant to a Warrant Agreement in the form attached
hereto as Exhibit B, which option to purchase the Warrants shall be exercisable
for an aggregate purchase price determined in accordance with Section 2.02
hereof; provided, however, that in the event of the payment by Chart of the
Settlement Amount (as defined in Section 2.02 below), the Purchase Period shall
expire on the earlier to occur of (a) the fifth anniversary of the date hereof
or (b) the date which is one hundred and twenty (120) days following the date a
written notice is sent by Chart to the Members setting forth the amount of the
Settlement Amount and the general terms of the settlement or transaction giving
rise to the payment of the Settlement Amount.
II.02 Price of Warrants. If the Members determine, in their sole and
absolute discretion, to purchase the Warrants from Chart, the purchase price
therefor shall be an amount equal to seventy-five percent (75%) of the amount,if
any, paid by Chart, Holdings or any Affiliate thereof (the "Settlement Amount")
to Grumman Hill Investments LP ("Grumman Hill") in connection with (a) the
relinquishment or
6
<PAGE>
termination by Grumman Hill of all of its rights, or (b) any transaction or
series of transactions pursuant to which Grumman Hill sells to Chart, Holdings
or any Affiliate thereof (i) all of its right to the option (the "Option")
granted pursuant to that certain Caire Inc. Stock Option Agreement, dated
January 26, 1998, between Caire and Grumman Hill (the "Option Agreement"), (ii)
all of its rights to receive 10% Series AA Cumulative Preferred Stock (the
"Series AA Stock") of Caire Inc. ("Caire") or any other equity interest in Caire
pursuant to the exercise of the Option, or (iii) the actual Series AA Stock
issued to Grumman Hill upon the exercise of the Option or any other securities,
cash or property into which such Series AA Stock is converted or for which it is
exchanged; provided, however, that if the Members determine to purchase the
Warrant prior to the payment of the Settlement Amount or the original expiration
date of the Option (the "Expiration Date"), the purchase price of the Warrants
shall be an amount equal to seventy-five percent (75%) of (x) the aggregate
Liquidation Value (as defined in the Certificate of Designations, Preferences
and Rights of 10% Series AA Cumulative Preferred Stock of Caire Inc.) of the
shares of Series AA Stock issuable upon exercise of the Option as if such stock
was issued immediately prior to the fifth anniversary of the Grant Date (as
defined in the Option Agreement) (the "Maximum Purchase Price") minus (y) the
aggregate Exercise Price of the Option (as defined in the Option Agreement), as
if the Option were exercised immediately prior to the fifth anniversary of the
Grant Date. Notwithstanding the foregoing, if, during the Purchase Period,
Grumman Hill exercises the Option, the purchase price of the Warrant shall be an
amount equal to 75% of the amount paid to redeem, repurchase or otherwise
acquire the Series AA Stock issued upon exercise of the Option or if, on or
prior to the Expiration Date, Grumman Hill has failed to exercise the Option, or
no Settlement Amount has been paid by Chart, Holdings or any Affiliate thereof
to Grumman Hill, then the purchase price of the Warrant shall be $1.00. If the
Members pay the Maximum Purchase Price for the Warrant and subsequent to such
payment (x) Chart pays the Settlement Amount and seventy-five percent (75%) of
such Settlement Amount is less than the Maximum Purchase Price, then Chart shall
pay to the Members an amount equal to (i) the Maximum Purchase Price minus (ii)
seventy-five percent (75%) of the Settlement Amount or (y) Grumman Hill's right
to receive the Series AA Stock expires without payment of the Settlement Amount,
then Chart shall pay to the Members the Maximum Purchase Price minus $1.00.
ARTICLE III.
MISCELLANEOUS
III.01 Effective Time of Agreement. This Agreement shall not become
7
<PAGE>
effective unless the Merger is consummated, in which case this Agreement shall
be deemed to be effective as of the Effective Time of the Merger.
III.02 Notices. All notices, requests and other communications to
any party hereunder shall be in writing (including telecopy or similar writing)
and shall be given,
if to Chart or Holdings, to:
Chart Industries, Inc.
5885 Landerbrook Drive
Suite 150
Mayfield Heights, Ohio 44124
Attention: Arthur S. Holmes
Telecopy: (440) 753-1451
with a copy to:
Calfee, Halter & Griswold LLP
1400 McDonald Investment Center
800 Superior Avenue
Cleveland, Ohio 44114-2688
Attention: Thomas F. McKee, Esq.
Telecopy: (216) 241-0816
if to the Members, to:
ACI Capital I, LLC
707 Westchester Avenue
White Plains, New York 10604
Attention: Kevin Penn
Telecopy: (914) 681-9856
with a copy to:
Weil, Gotshal & Manges LLP
767 Fifth Avenue
New York, New York 10153
Attention: Stephen M. Besen, Esq.
8
<PAGE>
Telecopy: (212) 310-8007
Unless otherwise provided, any notice required or permitted under
this Agreement shall be given in writing and shall be deemed effective (i) if
personally delivered, at the time delivered by hand, (ii) if delivered by
facsimile transmission, upon confirmation of transmission, (iii) if by courier,
on the business day such courier guarantees delivery, and (iv) if delivered by
U.S. Mail, seven business days after deposit in the U.S. Mail, postage prepaid.
III.03 No Waivers. No failure or delay by either party in exercising
any right, power or privilege hereunder shall operate as a waiver thereof nor
shall any single or partial exercise thereof preclude any other or further
exercise thereof or the exercise of any other right, power or privilege. The
rights and remedies herein provided shall be cumulative and not exclusive of any
rights or remedies provided by law.
III.04 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, provided that neither party may assign,
delegate or otherwise transfer any of its rights or obligations under this
Agreement without the consent of the other party hereto.
III.05 Counterparts; Effectiveness. This Agreement may be signed in
two counterparts, each of which shall be an original, with the same effect as if
the signatures thereto and hereto were upon the same instrument. Subject to
Section 3.01, this Agreement shall become effective when each party hereto shall
have received a counterpart hereof signed by the other party hereto.
III.06 Entire Agreement; Assignment. (a) This Agreement, the Merger
Agreement, the Escrow Agreement and the Warrant Agreement constitute the entire
agreement between the parties hereto with respect to the subject matter hereof
and thereof and supersedes all prior agreements, understandings and
negotiations, both written and oral, between the paries with respect to the
subject matter hereof and thereof. No representation, inducement, promise,
understanding, condition or warranty not set forth herein has been made or
relied upon by either party hereto. Except as expressly stated herein, this
Agreement is not intended to confer upon any person other than the parties
hereto any rights or remedies hereunder.
9
<PAGE>
(b) Neither this Agreement nor any of the rights, interests or
obligations hereunder shall be assigned by operation of Law (including, but not
or otherwise; provided, however, that Chart may assign its rights and
obligations hereunder in connection with a sale or transfer of all or
substantially all of its assets or its rights hereunder to any of its creditors.
Any assignment in violation of the preceding sentence shall be void. Subject to
the preceding sentence, this Agreement will be binding upon, inure to the
benefit of, and be enforceable by, the parties and their respective successors
and assigns.
III.07 Governing Law. This Agreement shall be governed in all
respects by the laws of the State of Delaware, excluding its conflict of law
provisions.
III.08 Captions. The captions herein are included for convenience of
reference only and shall be ignored in the construction or interpretation
hereof.
III.09 Amendment. This Agreement may be amended, supplemented or
modified, and any provisions may be waived, only pursuant to a written
instrument signed by the parties hereto.
III.010 Severability. The invalidity or enforceability of any
provision of this Agreement shall not effect the validity or enforceability of
any other provision of this Agreement, each of which shall remain in full force
and effect.
10
<PAGE>
IN WITNESS WHEREOF, the parties hereto here caused this Agreement to
be duly executed by their respective authorized officers as of the day and year
first above written.
CHART INDUSTRIES, INC.
By: /s/ Arthur S. Holmes
------------------------------------
Name: Arthur S. Holmes
Title: Chairman and Chief Executive
Officer
MVE HOLDINGS, INC.
By: /s/ John M. Kucharik
------------------------------------
Name: John M. Kucharik
Title: President and CEO
11
<PAGE>
THE MEMBERS:
ACI CAPITAL I, LLC
By: /s/ Kevin S. Penn
----------------------------------
Name: Kevin S. Penn
Title: President
AMERICAN SECURITIES PARTNERS, L.P.
By: American Securities Associates, L.P.,
its general partner
By: American Securities Partners GP
(Management) Corp.
By: Authorized Representative
----------------------------------
Name:
Title:
MVE CRYOGENICS LLC
By: Authorized Representative
------------------------------------
Name:
Title:
CRM/MVE CAPITAL LLC
By: Cramer Rosenthal McGlynn, Inc.,
as Manager
By: /s/ Eugene Trainor
------------------------------------
Name: Eugene Trainor
Title: EVD, COO
12
<PAGE>
TANGENT LLC
By: /s/ Authorized Representative
-----------------------------------
Name:
Title:
FERTOSA LLC
By: /s/ Authorized Representative
------------------------------------
Name:
Title:
BURDEN DIRECT INVESTMENT FUND II
By: William A.M. Burden & Co., L.P.,
its general partner
By: Burden Brothers, Inc.,
its sole general partner
By: /s/ Jeffrey A. Weber
--------------------------------------
Name: Jeffrey A. Weber
Title: President and CEO
13
<PAGE>
PROMISSORY NOTE
(Revolving Credit Loan)
$[_________________] April [__], 1999
New York, New York
FOR VALUE RECEIVED, CHART INDUSTRIES, INC., a Delaware corporation
(the "Borrower"), hereby promises to pay to _____________(the "Lender"), at such
of the offices of The Chase Manhattan Bank as shall be notified to the Borrower
from time to time, the principal sum of ______________(or such lesser amount as
shall equal the aggregate unpaid principal amount of the Revolving Credit Loans
made by the Lender to the Borrower under the Credit Agreement), in lawful money
of the United States of America and in immediately available funds, on the dates
and in the principal amounts provided in the Credit Agreement, and to pay
interest on the unpaid principal amount of each such Revolving Credit Loan, at
such office, in like money and funds, for the period commencing on the date of
such Revolving Credit Loan until such Revolving Credit Loan shall be paid in
full, at the rates per annum and on the dates provided in the Credit Agreement.
The date, amount, Type, interest rate and duration of Interest
Period (if applicable) of each Revolving Credit Loan made by the Lender to the
Borrower, and each payment made on account of the principal thereof, shall be
recorded by the Lender on its books and, prior to any transfer of this Note,
endorsed by the Lender on the schedule attached hereto or any continuation
thereof, provided that the failure of the Lender to make any such recordation or
endorsement shall not affect the obligations of the Borrower to make a payment
when due of any amount owing under the Credit Agreement or hereunder in respect
of the Revolving Credit Loans made by the Lender.
This Note is one of the notes referred to in the Credit Agreement
dated as of April [__], 1999 (as modified and supplemented and in effect from
time to time, the "Credit Agreement") between the Borrower, the Subsidiary
Guarantors party thereto, the lenders party thereto, and The Chase Manhattan
Bank, as Administrative Agent and evidences Revolving Credit Loans made by the
Lender thereunder. Terms used but not defined in this Note have the respective
meanings assigned to them in the Credit Agreement.
The Credit Agreement provides for the acceleration of the maturity
of this Note upon the occurrence of certain events and for prepayments of Loans
upon the terms and conditions specified therein.
Except as permitted by Section 10.04 of the Credit Agreement, this
Note may not be assigned by the Lender to any other Person.
Revolving Credit Loan Note
<PAGE>
-2-
This Note shall be governed by, and construed in accordance with,
the law of the State of New York.
CHART INDUSTRIES, INC.
By_________________________
Title:
Revolving Credit Loan Note
<PAGE>
-3-
SCHEDULE OF REVOLVING CREDIT LOANS
This Note evidences the Revolving Credit Loans made, continued or
converted under the within-described Credit Agreement to the Borrower, on the
dates, in the principal amounts, of the Types, bearing interest at the rates and
having Interest Periods (if applicable) of the durations set forth below,
subject to the payments, continuations, conversions and prepayments of principal
set forth below:
Amount
Date Prin- Paid,
Made, cipal Duration Prepaid, Unpaid
Continued Amount Type of Continued Prin-
or of of Interest Interest or cipal Notation
Converted Loan Loan Rate Period Converted Amount Made by
- --------- ---- ---- ---- ------ --------- ------ -------
Revolving Credit Loan Note
<PAGE>
PROMISSORY NOTE
(A Term Loan)
$[___________________] April [__], 1999
New York, New York
FOR VALUE RECEIVED, CHART INDUSTRIES, INC., a Delaware corporation
(the "Borrower"), hereby promises to pay to ___________ (the "Lender"), at such
of the offices of The Chase Manhattan Bank as shall be notified to the Borrower
from time to time, the principal sum of ____________________, in lawful money of
the United States of America and in immediately available funds, on the dates
and in the principal amounts provided in the Credit Agreement, and to pay
interest on the unpaid principal amount of each A Term Loan evidenced hereby, at
such office, in like money and funds, for the period commencing on the date of
such A Term Loan until such A Term Loan shall be paid in full, at the rates per
annum and on the dates provided in the Credit Agreement.
The date, amount, Type, interest rate and duration of Interest
Period (if applicable) of each A Term Loan made by the Lender to the Borrower
and evidenced hereby, and each payment made on account of the principal thereof,
shall be recorded by the Lender on its books and, prior to any transfer of this
Note, endorsed by the Lender on the schedule attached hereto or any continuation
thereof, provided that the failure of the Lender to make any such recordation or
endorsement shall not affect the obligations of the Borrower to make a payment
when due of any amount owing under the Credit Agreement or hereunder in respect
of such A Term Loans.
This Note is one of the notes referred to in the Credit Agreement
dated as of April [__], 1999 (as modified and supplemented and in effect from
time to time, the "Credit Agreement") between the Borrower, the Subsidiary
Guarantors party thereto, the lenders party thereto, and The Chase Manhattan
Bank, as Administrative Agent and evidences A Term Loans made by the Lender
thereunder. Terms used but not defined in this Note have the respective meanings
assigned to them in the Credit Agreement.
The Credit Agreement provides for the acceleration of the maturity
of this Note upon the occurrence of certain events and for prepayments of Term
Loan A upon the terms and conditions specified therein.
Except as permitted by Section 10.04 of the Credit Agreement, this
Note may not be assigned by the Lender to any other Person.
A Term Loan Note
<PAGE>
-2-
This Note shall be governed by, and construed in accordance with,
the law of the State of New York.
CHART INDUSTRIES, INC.
By_________________________
Title:
A Term Loan Note
<PAGE>
-3-
SCHEDULE OF A TERM LOANS
This Note evidences A Term Loans made, continued or converted under
the within-described Credit Agreement to the Borrower, on the dates, in the
principal amounts, of the Types, bearing interest at the rates and having
Interest Periods (if applicable) of the durations set forth below, subject to
the payments, continuations, conversions and prepayments of principal set forth
below:
Amount
Date Prin- Paid,
Made, cipal Duration Prepaid, Unpaid
Continued Amount Type of Continued Prin-
or of of Interest Interest or cipal Notation
Converted Loan Loan Rate Period Converted Amount Made by
- --------- ---- ---- ---- ------ --------- ------ -------
A Term Loan Note
<PAGE>
PROMISSORY NOTE
(B Term Loan)
$[___________________] April [__], 1999
New York, New York
FOR VALUE RECEIVED, CHART INDUSTRIES, INC., a Delaware corporation
(the "Borrower"), hereby promises to pay to ___________ (the "Lender"), at such
of the offices of The Chase Manhattan Bank as shall be notified to the Borrower
from time to time, the principal sum of ____________________, in lawful money of
the United States of America and in immediately available funds, on the dates
and in the principal amounts provided in the Credit Agreement, and to pay
interest on the unpaid principal amount of each B Term Loan evidenced hereby, at
such office, in like money and funds, for the period commencing on the date of
such B Term Loan until such B Term Loan shall be paid in full, at the rates per
annum and on the dates provided in the Credit Agreement.
The date, amount, Type, interest rate and duration of Interest
Period (if applicable) of each B Term Loan made by the Lender to the Borrower
and evidenced hereby, and each payment made on account of the principal thereof,
shall be recorded by the Lender on its books and, prior to any transfer of this
Note, endorsed by the Lender on the schedule attached hereto or any continuation
thereof, provided that the failure of the Lender to make any such recordation or
endorsement shall not affect the obligations of the Borrower to make a payment
when due of any amount owing under the Credit Agreement or hereunder in respect
of such B Term Loans.
This Note is one of the notes referred to in the Credit Agreement
dated as of April [__], 1999 (as modified and supplemented and in effect from
time to time, the "Credit Agreement") between the Borrower, the Subsidiary
Guarantors party thereto, the lenders party thereto, and The Chase Manhattan
Bank, as Administrative Agent and evidences B Term Loans made by the Lender
thereunder. Terms used but not defined in this Note have the respective meanings
assigned to them in the Credit Agreement.
The Credit Agreement provides for the acceleration of the maturity
of this Note upon the occurrence of certain events and for prepayments of Term
Loan B upon the terms and conditions specified therein.
Except as permitted by Section 10.04 of the Credit Agreement, this
Note may not be assigned by the Lender to any other Person.
B Term Loan Note
<PAGE>
-2-
This Note shall be governed by, and construed in accordance with,
the law of the State of New York.
CHART INDUSTRIES, INC.
By_________________________
Title:
B Term Loan Note
<PAGE>
-3-
SCHEDULE OF B TERM LOANS
This Note evidences B Term Loans made, continued or converted under
the within-described Credit Agreement to the Borrower, on the dates, in the
principal amounts, of the Types, bearing interest at the rates and having
Interest Periods (if applicable) of the durations set forth below, subject to
the payments, continuations, conversions and prepayments of principal set forth
below:
Amount
Date Prin- Paid,
Made, cipal Duration Prepaid, Unpaid
Continued Amount Type of Continued Prin-
or of of Interest Interest or cipal Notation
Converted Loan Loan Rate Period Converted Amount Made by
- --------- ---- ---- ---- ------ --------- ------ -------
B Term Loan Note
<PAGE>
Recording requested by:
[NAME OF TITLE INSURANCE COMPANY]
This Mortgage was prepared by and
when recorded should be mailed to:
______________________, Esq.
Milbank, Tweed, Hadley & McCloy LLP
1 Chase Manhattan Plaza
New York, New York 10005
--------------------------------------------------------------
Space above this line for recorder's use
MORTGAGE, ASSIGNMENT OF RENTS, SECURITY AGREEMENT AND
FIXTURE FILING
KNOW ALL PERSONS BY THESE PRESENTS:
THIS MORTGAGE, ASSIGNMENT OF RENTS, SECURITY AGREEMENT AND FIXTURE
FILING (this "Mortgage") is made as of the [ ]th day of March, 1999 by
[ ], a corporation duly organized and validly existing under the laws of
the State of [ ] and having an office at _______________________________
(the "Mortgagor"), in favor of THE CHASE MANHATTAN BANK, a New York State
banking corporation having its principal office at 270 Park Avenue, New York,
New York 10017, as administrative agent for the lenders referred to below (in
such capacity, together with its successors in such capacity, the "Mortgagee").
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W I T N E S S E T H:
WHEREAS, Chart Industries, Inc., a corporation organized under the
laws of the State of Delaware (the "Borrower"), the Subsidiary Guarantors party
thereto (including the Mortgagor), certain lenders (collectively, the "Lenders")
and the Mortgagee are parties to a Credit Agreement dated as of March [ ], 1999
(said Credit Agreement, as modified and supplemented and in effect from time to
time, being herein called the "Credit Agreement"; except as otherwise herein
expressly provided, all terms defined in the Credit Agreement being used herein
as defined therein), which Credit Agreement provides for extensions of credit
(by making of loans and issuing letters of credit) to be made by the Lenders to
the Mortgagor in an aggregate principal or face amount not exceeding
$300,000,000;
WHEREAS, the Mortgagor may from time to time be obligated to pay to
one or more of the Lenders (each, a "Swap Provider") in respect of one or more
Hedging Agreements as required by Section 6.09 of the Credit Agreement (such
obligations being herein referred to as the "Hedging Agreement Obligations")
which amounts are payable by the Mortgagor to the Swap Providers as additional
interest in connection with the loans under the Credit Agreement;
WHEREAS, the Mortgagor may from time to time be obligated to one or
more of the Lenders (each, a "Letter of Credit Lender") in respect of one or
more letters of credit issued by such Lenders for account of the Mortgagor as
permitted by Section 2.05 of the Credit Agreement (such obligations being herein
referred to as the "Reimbursement Obligations");
WHEREAS, pursuant to Article III of the Credit Agreement the
Mortgagor has unconditionally guaranteed the principal of and interest on, and
all other amounts from time to time owing under the Credit Agreement, as well as
the Hedging Agreement Obligations and the Reimbursement Obligations;
WHEREAS, it is a condition to the obligation of the Lenders to
extend credit to the Borrower pursuant to the Credit Agreement that the
Mortgagor execute and deliver this Mortgage;
NOW, THEREFORE, for good and valuable consideration, the receipt of
which is hereby acknowledged, and FOR THE PURPOSE OF SECURING the following
(collectively, the "Obligations"):
(a) the obligations of the Mortgagor in respect of its guarantee
under the Guarantee Agreement,
(b) the obligations of the Mortgagor to the Swap Providers
constituting Hedging Agreement Obligations,
(c) the obligations of the Mortgagor to the Issuing Lender
constituting
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Reimbursement Obligations,
(d) the performance and payment of the covenants, agreements and
obligations hereinafter contained and all other monies secured hereby,
including, without limitation, any and all sums expended by the Mortgagee
pursuant to Section 1.13, together with interest thereon, and
(e) the payment of all other obligations of the Mortgagor to the
Lenders under the Credit Agreement,
the Mortgagor hereby irrevocably grants, bargains, sells, releases, conveys,
warrants, assigns, transfers, mortgages, pledges, sets over and confirms unto
the Mortgagee, under and subject to the terms and conditions hereinafter set
forth, all of the following described properties:
(A) the land and premises (collectively, the "Fee Property") more
particularly described in Schedule I; and
(B) the [lease/lease agreement] (the "Lease") more particularly
described in Schedule II affecting the land and premises (collectively,
the "Leasehold Property" and, together with the Fee Property, the
"Properties") described in Schedule II;
TOGETHER WITH all interests, estates or other claims, both in law
and in equity, that the Mortgagor now has or may hereafter acquire in (a) the
Properties, (b) all easements, rights-of-way and rights used in connection
therewith or as a means of access thereto and (c) all tenements, hereditaments
and appurtenances in any manner belonging, relating or appertaining thereto (all
of the foregoing interests, estates and other claims being hereinafter
collectively called "Easements and Rights of Way"); and
TOGETHER WITH all estate, right, title and interest of the
Mortgagor, now owned or hereafter acquired, in and to any land lying within the
right-of-way of any streets, open or proposed, adjoining the Properties, and any
and all sidewalks, alleys and strips and gores of land adjacent to or used in
connection therewith (all of the foregoing estate, right, title and interest
being hereinafter called "Adjacent Rights"); and
TOGETHER WITH all estate, right, title and interest of the
Mortgagor, now owned or hereafter acquired, in and to any and all buildings and
other improvements now or hereafter located on the Properties and all building
materials, building equipment and fixtures of every kind and nature located on
the Properties or, attached to, contained in or used in any such buildings and
other improvements, and all appurtenances and additions thereto and betterments,
substitutions and replacements thereof (all of the foregoing estate, right,
title and interest being hereinafter collectively called, "Improvements"); and
TOGETHER WITH all estate, right, title and interest of the Mortgagor
in and to all such tangible property now owned or hereafter acquired by the
Mortgagor (including all machinery, apparatus, equipment, fittings and articles
of personal property) and now or hereafter
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located on or at or attached to the Properties that an interest in such tangible
property arises under applicable real estate law, and any and all products and
accessions to any such property that may exist at any time (all of the foregoing
estate, right, title and interest, and products and accessions, being
hereinafter called "Fixtures"); and
TOGETHER WITH all estate, right, title and interest of the Mortgagor
in and to all rights, royalties and profits in connection with all minerals, oil
and gas and other hydrocarbon substances on or in the Properties, development
rights or credits, air rights, water, water rights (whether riparian,
appropriative, or otherwise and whether or not appurtenant) and water stock (all
of the foregoing estate, right, title and interest being hereinafter
collectively called "Mineral and Related Rights"); and
TOGETHER WITH all reversion or reversions and remainder or
remainders of the Properties and Improvements and all estate, right, title and
interest of the Mortgagor in and to any and all present and future leases of
space in the Properties and Improvements, and all rents, revenues, proceeds,
issues, profits, royalties, income and other benefits now or hereafter derived
from the Properties, the Improvements and the Fixtures, subject to the right,
power and authority hereinafter given to the Mortgagor to collect and apply the
same (all of the foregoing reversions, remainders, leases of space, rents,
revenues, proceeds, issues, profits, royalties, income and other benefits being
hereinafter collectively called "Rents"); and
TOGETHER WITH all estate, right, title and interest and other claim
or demand that the Mortgagor now has or may hereafter acquire with respect to
any damage to the Properties, the Improvements or the Fixtures and any and all
proceeds of insurance in effect with respect to the Improvements or the
Fixtures, and any and all awards made for the taking by eminent domain, or by
any proceeding or purchase in lieu thereof, of the Properties, the Improvements
or the Fixtures, including without limitation any awards resulting from a change
of grade of streets or as the result of any other damage to the Properties, the
Improvements or the Fixtures for which compensation shall be given by any
governmental authority (all of the foregoing estate, right, title and interest
and other claims or demand, and any such proceeds or awards, being hereinafter
collectively, called "Damage Rights"); and
TOGETHER WITH all the estate, right, title, interest and other claim
of the Mortgagor with respect to any parking facilities located other than on
the Properties and used or intended to be used in connection with the operation,
ownership or use of the Properties, any and all replacements and substitutions
for the same, and any other parking rights, easements, covenants and other
interests in parking facilities acquired by the Mortgagor for the use of tenants
or occupants of the Improvements (all of the foregoing estate, right, title,
interest and other claim being hereinafter collectively called "Parking
Rights"); and
TOGETHER WITH all estate, right, title and interest of the Mortgagor
with respect to any and all air rights, development rights, zoning rights or
other similar rights or interests that benefit or are appurtenant to the
Properties or the Improvements (all of the foregoing estate, right, title and
interest being hereinafter collectively called "Air and Development Rights");
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All of the foregoing Easements and Rights of Way, Adjacent Rights,
Improvements, Fixtures, Minerals and Related Rights, Rents, Damage Rights,
Parking Rights and Air and Development Rights being sometimes hereinafter
referred to collectively as the "Ancillary Rights and Properties" and the Lease,
Properties and Ancillary Rights and Properties being sometimes hereinafter
referred to collectively as the "Mortgage Estate";
TO HAVE AND TO HOLD the Mortgage Estate with all privileges and
appurtenances thereunto belonging, to the Mortgagee and its successors and
assigns, forever, upon the terms and conditions and for the uses hereinafter set
forth;
PROVIDED ALWAYS, that if the principal of and interest on the
extensions of credit under the Credit Agreement and all of the other Obligations
shall be paid in full, and the Mortgagor shall abide by and comply with each and
every covenant contained herein and in the Credit Agreement, then this Mortgage
and the estate hereby granted shall cease, terminate and become void.
This Mortgage, the Credit Agreement and any other instrument given
to evidence or further secure the payment and performance of any Obligation are
sometimes hereinafter collectively referred to as the "Loan Instruments".
TO PROTECT THE SECURITY OF THIS MORTGAGE, THE MORTGAGOR HEREBY
COVENANTS AND AGREES AS FOLLOWS:
ARTICLE 1
Particular Covenants and Agreements of the Mortgagor
Section 1.01. Payment of Secured Obligations. The Mortgagor shall
pay when due all Obligations.
Section 1.02. Title, Etc. The Mortgagor represents and warrants that
it has good and marketable fee simple title in and to the Fee Properties, and
the related Ancillary Rights and Properties, in each case subject to no
mortgage, deed of trust, lien, pledge, charge, security interest or other
encumbrance or adverse claim of any nature, except those listed as exceptions to
title in the title policy insuring the lien or estate created by this Mortgage.
The Mortgagor represents and warrants that (a) the Lease is in full
force and effect and there are no defaults thereunder and no event has occurred
and is continuing that with notice or lapse of time or both will result in such
a default and (b) the Mortgagor is lawfully seized and possessed of a valid and
subsisting leasehold estate in and to the Leasehold Properties and is the owner
of the related Ancillary Rights and Properties with respect to the Lease, in
each case subject to no mortgage, deed of trust, lien, pledge, charge, security
interest or other encumbrance or adverse claim of any nature (including, without
limitation, any thereof affecting the fee title to
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the Leasehold Properties), except those listed as exceptions to title in the
title policy insuring the lien or estate created by this Mortgage.
The Mortgagor represents and warrants that it has the full power and
lawful authority to grant, bargain, sell, release, convey, warrant, assign,
transfer, mortgage, pledge, set over and confirm unto the Mortgagee the Mortgage
Estate as hereinabove provided and warrants that it will forever defend the
title to the Mortgage Estate and the validity and priority of the lien or estate
hereof against the claims and demands of all persons whomsoever.
Section 1.03. Further Assurances; Filing; Re-Filing; Etc.
(a) Further Instruments. The Mortgagor shall execute, acknowledge
and deliver, from time to time, such further instruments as the Mortgagee may
require to accomplish the purposes of this Mortgage.
(b) Filing and Refiling. The Mortgagor, immediately upon the
execution and delivery of this Mortgage, and thereafter from time to time, shall
cause this Mortgage, any security agreement or mortgage supplemental hereto and
each instrument of further assurance to be filed, registered or recorded and
refiled, re-registered or re-recorded in such manner and in such places as may
be required by any present or future law in order to publish notice of and
perfect the lien or estate of this Mortgage upon the Mortgage Estate.
(c) Fees and Expenses. The Mortgagor shall pay all filing,
registration and recording fees, all refiling, re-registration and re-recording
fees, and all expenses incident to the execution, filing, recording and
acknowledgment of this Mortgage, any security agreement or mortgage supplemental
hereto and any instrument of further assurance, and all Federal, state, county
and municipal stamp taxes and other taxes, duties, imposts, assessments and
charges arising out of or in connection with the execution, delivery, filing and
recording of this Mortgage or any of the other Loan Instruments, any security
agreement or mortgage supplemental hereto or any instruments of further
assurance.
Section 1.04. Liens. Except as otherwise provided in Section 7.02 of
the Credit Agreement, but without limiting the obligations of the Mortgagor
under Section 1.07 of this Mortgage, the Mortgagor shall not create or suffer to
be created any mortgage, deed of trust, lien, security interest, charge or
encumbrance upon the Mortgage Estate prior to, on a parity with, or subordinate
to the lien of this Mortgage. The Mortgagor shall pay and promptly discharge at
the Mortgagor's cost and expense, any such mortgages, deeds of trust, liens,
security interests, charges or encumbrances upon the Mortgage Estate or any
portion thereof or interest therein.
Section 1.05. Insurance. The Mortgagor will maintain insurance, with
respect to the Mortgage Estate, issued by financially sound and reputable
insurers against loss or damage by reason of any Peril (as defined below) in
such amounts (subject to such deductibles as shall be satisfactory to the
Mortgagor) as shall be reasonable and customary and sufficient to avoid the
insured named therein from becoming a co-insurer of any loss under such policy
but in any event in an amount at least equal to 100% of the actual replacement
cost of the Mortgage Estate
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(including, without limitation, foundation, footings and excavation costs),
subject to deductibles as aforesaid. In addition, the Mortgagor will maintain
insurance (i) against claims for bodily injury, death or property damage
occurring on, in or about the Mortgage Estate (and adjoining streets, sidewalks
and waterways), in such amounts as are then customary for property similar in
use in the jurisdictions where the Mortgage Estate is located and (ii) such
other insurance, including, without limitation, War-Risk Insurance when and to
the extent obtainable from the United States Government, in each case as
generally carried by owners of properties similar to the Mortgage Estate in the
jurisdictions where the Mortgage Estate is located, in such amounts and against
such risks as are then customary for property similar in use. The Mortgagor
expressly assumes all risk of loss, including a decrease in the use, enjoyment
or value of the Mortgage Estate from any Peril, whether or not insurable or
insured against.
Such insurance shall be written by financially responsible companies
selected by the Mortgagor and having an A.M. Best rating of "A+" or better and
being in a financial size category of XIV or larger, or by other companies
acceptable to the Mortgagee, and shall name the Mortgagee as loss payee (to the
extent covering risk of loss or damage to tangible property) and as an
additional named insured as its interests may appear (to the extent covering any
other risk). Each policy referred to in this Section 1.05 shall provide that it
will not be canceled or reduced, or allowed to lapse without renewal, except
after not less than 30 days' notice to the Mortgagee and shall also provide that
the interests of the Mortgagee and the Lenders shall not be invalidated by any
act or negligence of the Mortgagor or any Person having an interest in the
Mortgage Estate nor by occupancy or use of any of the Mortgage Estate for
purposes more hazardous than permitted by such policy nor by any foreclosure or
other proceedings relating to the Mortgage Estate. The Mortgagor will advise the
Mortgagee promptly of any policy cancellation, reduction or amendment.
On or before the date hereof, the Mortgagor will deliver to the
Mortgagee certificates of insurance satisfactory to the Mortgagee evidencing the
existence of all insurance required to be maintained by the Mortgagor hereunder
setting forth the respective coverages, limits of liability, carrier, policy
number and period of coverage and showing that such insurance will remain in
effect through the December 31 falling at least six months after the date
hereof, subject only to the payment of premiums as they become due (and
attaching original copies of any policies with respect to casualty insurance).
Thereafter, on each November 15 in each year (commencing with the first November
15 after the date hereof) the Mortgagor will deliver to the Mortgagee
certificates of insurance evidencing that all insurance required to be
maintained by the Mortgagor hereunder will be in effect through the December 31
of the calendar year following the calendar year of the current November 15,
subject only to the payment of premiums as they become due. In addition, the
Mortgagor will not modify any of the provisions of any policy with respect to
casualty insurance without delivering the original copy of the endorsement
reflecting such modification to the Mortgagee accompanied by a written report of
_______________, or any other firm of independent insurance brokers of
nationally recognized standing, stating that, in their opinion, such policy (as
so modified) adequately protects the interests of of the Lenders and the
Mortgagee, is in compliance with the provisions of this Section 1.05, and is
comparable in all respect with insurance carried by responsible owners and
operators of properties similar to the Mortgage Estate. The Mortgagor will not
obtain or carry separate insurance concurrent in
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form or contributing in the event of loss with that required by this Section
1.05 unless the Mortgagee is the named insured thereunder, with loss payable as
provided herein. The Mortgagor will immediately notify the Mortgagee whenever
any such separate insurance is obtained and shall deliver to the Mortgagee the
certificates evidencing the same.
Without limiting the obligations of the Mortgagor under the
foregoing provisions of this Section 1.05, in the event the Mortgagor shall fail
to maintain in full force and effect insurance as required by the foregoing
provisions of this Section 1.05, then the Mortgagee may, but shall have no
obligation so to do, procure insurance covering the interests of the Lenders and
the Mortgagee in such amounts and against such risks as the Mortgagee shall deem
appropriate and the Mortgagor shall reimburse the Mortgagee in respect of any
premiums paid by the Mortgagee in respect thereof.
For purposes hereof, the term "Peril" means, collectively, fire,
lightning, flood, windstorm, hail, earthquake, explosion, riot and civil
commotion, vandalism and malicious mischief, damage from aircraft, vehicles and
smoke and all other perils covered by the "all-risk" endorsement then in use in
the jurisdictions where the Mortgage Estate is located.
Nothing in this Section 1.05 shall be deemed to limit in any respect
the obligations of the Mortgagor under Section [6.05] of the Credit Agreement.
Section 1.06. Casualty and Condemnation Events.
(a) Casualty and Condemnation. Should the Mortgage Estate or any
part thereof be taken or damaged by reason of any fire or other casualty
(collectively, a "Casualty"), or by reason of any public improvement or
condemnation proceeding (collectively, a "Condemnation") or should the Mortgagor
receive any notice or other information regarding any such proceeding, the
Mortgagor shall give prompt notice thereof to the Mortgagee. The Mortgagee
shall, subject to the rights of the lessor under the Lease, be entitled to
receive all insurance or other amounts payable as a result of any such Casualty
(collectively, the "Casualty Proceeds"), and all compensation, awards, damages
and other payments or relief arising out of any such condemnation or any part
thereof (collectively, "Condemnation Proceeds"), and all such insurance and
other amounts, and compensation, awards, damages and other payments or relief,
together with all rights and causes of action relating thereto or arising out of
any such Casualty or Condemnation, are hereby assigned to the Mortgagee. The
Mortgagor shall execute such further assignments of the Casualty Proceeds and
Condemnation Proceeds as the Mortgagee may from time to time require.
(b) Restoration Account. Following the occurrence of any Casualty or
Condemnation involving the Mortgage Estate or any part thereof resulting in a
loss in excess of $_________, the Mortgagor shall give prompt notice thereof to
the Mortgagee and shall cause all Casualty or Condemnation Proceeds, as the case
may be, to be paid to the Mortgagee as additional collateral security hereunder
subject to the lien of this Mortgage. Upon receipt by the Mortgagee of any such
proceeds (including, without limitation, any Casualty Proceeds payable directly
to the Mortgagee as loss payee under the respective policies maintained pursuant
to
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Section 1.05), the Mortgagee shall deposit the same into a cash collateral
account (the "Restoration Account") in the name and under the control of the
Mortgagee. The balance from time to time in the Restoration Account shall
constitute part of the Mortgage Estate hereunder and shall not constitute
payment of the Obligations until applied as hereinafter provided.
(c) Application of Proceeds. Following the occurrence of any
Casualty or Condemnation involving the Mortgage Estate or any part thereof
resulting in a loss in excess of $__________, but without limiting its
obligations under Section 1.08 to restore and repair any Improvements and
Fixtures affected by such event, the Mortgagor may, at its option, to be
exercised by delivery of notice to the Mortgagee within [30] days of such
Casualty or Condemnation, elect to either apply any Casualty or Condemnation
Proceeds received as a result of such event: (i) to the restoration and repair
of that part of the Mortgage Estate affected by such Casualty or Condemnation
(the "Affected Property"); or (ii) subject to the rights of the lessor under the
Lease, to the prepayment of the loans or other indebtedness constituting the
Obligations hereunder in the manner and to the extent specified in Section
2.10(b) of the Credit Agreement. Failure of the Mortgagor to make such an
election within three months from the date of the respective Casualty or
Condemnation shall automatically constitute an election to so apply the
respective Casualty or Condemnation Proceeds to the prepayment as aforesaid of
the indebtedness secured hereby.
If the Mortgagor elects to so restore and repair the Affected
Property, any amounts (and any earnings thereon) held in the Restoration Account
shall, subject to the rights of the lessor under the Lease, be applied by the
Mortgagee to the restoration and repair of the Affected Property and advanced to
the Mortgagor in periodic installments upon compliance by the Mortgagor with
such reasonable conditions to disbursement as may be imposed by the Mortgagee,
including, but not limited to, reasonable retention amounts and receipt of lien
releases.
Anything in this Section 1.06 to the contrary notwithstanding, the
Mortgagee shall have no obligation to release any amounts held in the
Restoration Account to the Mortgagor for restoration or repair of the Affected
Property if an Event of Default (as defined in Section 4.01), or any event that
with lapse of time or with notice and lapse of time would become an Event of
Default, has occurred and is continuing. If an Event of Default, or any event
that with lapse of time or with notice and lapse of time would become an Event
of Default, has occurred and is continuing, the Mortgagee may, in its sole
discretion, subject to the rights of the lessor under the Lease, apply any
Casualty or Condemnation Proceeds either: (A) to the payment of the Obligations
as provided in paragraph (a) of Section 4.03 or (B) to the restoration or repair
of the Affected Property; provided, however, that if the Mortgagee requires such
proceeds to be applied to the restoration or repair of the Affected Property,
the Mortgagee will advance to the Mortgagor in accordance with the foregoing
provisions of this Section 1.06(c), the Casualty and Condemnation Proceeds, less
such amounts that may have been expended by the Mortgagee to effectuate any cure
of such Event of Default. All Casualty or Condemnation Proceeds remaining after
the payment for restoration and repair of the Affected Property pursuant to this
Section 1.06(c) may, at the option of the Mortgagee, subject to the rights of
the lessor under the Lease, be applied to the prepayment of the loans or other
indebtedness constituting the
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Obligations hereunder in the manner and to the extent specified in Section
2.10(b) of the Credit Agreement.
(d) Compromise, Adjustment or Settlement. The Mortgagee shall,
subject to the rights of the lessor under the Lease, be entitled at its option
to participate in any compromise, adjustment or settlement in connection with
any claims for loss, damage or destruction under any policy or policies of
insurance, in excess of $_________, and the Mortgagor shall within five Business
Days after request therefor reimburse the Mortgagee for all out-of-pocket
expenses (including reasonable attorneys' fees and disbursements) incurred by
the Mortgagee in connection with such participation. The Mortgagor shall not
make any compromise, adjustment or settlement in connection with any such claim
without the approval of the Mortgagee.
(e) Foreclosure, Etc. In the event of foreclosure of the lien of
this Mortgage or other transfer of title or assignment of the Mortgage Estate in
extinguishment, in whole or in part, of the Obligations, all right, title and
interest of the Mortgagor in and to all policies of casualty insurance covering
all or any part of the Mortgage Estate shall, subject to the rights of the
lessor under the Lease, inure to the benefit of and pass to the successors in
interest to the Mortgagor or the purchaser or grantee of the Mortgage Estate or
any part thereof.
Section 1.07. Impositions.
(a) Payment of Impositions. Except to the extent otherwise permitted
under Section 6.04 of the Credit Agreement, the Mortgagor shall pay or cause to
be paid, before any fine, penalty, interest or cost attaches thereto, all taxes,
assessments, water and sewer rates, utility charges and all other governmental
or nongovernmental charges or levies now or hereafter assessed or levied against
any part of the Mortgage Estate (including, without limitation, nongovernmental
levies or assessments such as maintenance charges, owner association dues or
charges or fees, levies or charges resulting from covenants, conditions and
restrictions affecting the Mortgage Estate) or upon the lien or estate of the
Mortgagee therein (collectively, "Impositions"), as well as all claims for
labor, materials or supplies that, if unpaid, might by law become a prior lien
thereon, and within 10 days after request by the Mortgagee will exhibit receipts
showing payment of any of the foregoing; provided, however, that if by law any
such Imposition may be paid in installments (whether or not interest shall
accrue on the unpaid balance thereof), the Mortgagor may pay the same in
installments (together with accrued interest on the unpaid balance thereof) as
the same respectively become due, before any fine, penalty or cost attaches
thereto.
(b) Right to Contest Impositions. To the extent not inconsistent
with the provisions of Section 6.04 of the Credit Agreement, the Mortgagor at
its expense may, after prior notice to the Mortgagee, contest by appropriate
legal, administrative or other proceedings conducted in good faith and with due
diligence, the amount or validity or application, in whole or in part, of any
Imposition or lien therefor or any claims of mechanics, materialmen, suppliers
or vendors or lien thereof, and may withhold payment of the same pending such
proceedings if permitted by law, so long as (i) in the case of any Impositions
or lien therefor or any claims of mechanics, materialmen, suppliers or vendors
or lien thereof, such proceedings shall suspend the
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collection thereof from the Mortgage Estate, (ii) neither the Mortgage Estate
nor any part thereof or interest therein will be sold, forfeited or lost if the
Mortgagor pays the amount or satisfies the condition being contested, and the
Mortgagor would have the opportunity to do so, in the event of the Mortgagor's
failure to prevail in the contest, (iii) neither the Mortgagee nor any of the
Lenders would, by virtue of such permitted contest, be exposed to any risk of
any civil liability for which the Mortgagor has not furnished additional
security as provided in clause (iv) below, or to any risk of criminal liability,
and neither the Mortgage Estate nor any interest therein would be subject to the
imposition of any lien for which the Mortgagor has not furnished additional
security as provided in clause (iv) below, as a result of the failure to comply
with such law or of such proceeding and (iv) the Mortgagor shall have furnished
to the Mortgagee additional security in respect of the claim being contested or
the loss or damage that may result from the Mortgagor's failure to prevail in
such contest in such amount as may be reasonably requested by the Mortgagee[,
but only to the extent that such claim or contest and all other then-current
claims or contests involve an aggregate amount greater than $_______].
Section 1.08. Maintenance of the Improvements and Fixtures. The
Mortgagor shall not permit the Improvements or Fixtures to be removed or
demolished (provided, however, that, subject to the provisions of Section
7.03(b)(ii) of the Credit Agreement, the Mortgagor may remove or alter such
Improvements and Fixtures that become obsolete in the usual conduct of the
Mortgagor's business and the removal or alteration of which do not materially
detract from the operation of the Mortgagor's business); shall maintain the
Mortgage Estate in good repair, working order and condition, except for
reasonable wear and use; and shall restore and repair the Improvements and
Fixtures or any part thereof now or hereafter affected by any Casualty or
Condemnation.
Section 1.09. Compliance With Laws.
(a) Representation. The Mortgagor represents and warrants that,
except as otherwise previously disclosed in writing to the Mortgagee (and except
for the matters described in paragraph (b) of this Section 1.09, as to which the
provisions of said paragraph (b) shall apply) the Mortgagor and its operations
at the Properties currently comply with all laws, ordinances, orders, rules and
regulations of all Federal, state, and local governments and of the appropriate
departments, commissions, boards and offices thereof, and the orders, rules and
regulations of the American Insurance Association or any other body now or
hereafter constituted exercising similar functions, that at any time are
applicable to the Mortgage Estate.
(b) Compliance with Environmental Laws. The Mortgagor represents and
warrants to the Mortgagee that the Mortgagor has obtained all environmental,
health and safety permits, licenses and other authorizations required under all
Environmental Laws (as defined below in this Section 1.09(b)) to carry on its
business as now being or as proposed to be conducted at the Properties. Each of
such permits, licenses and authorizations is in full force and effect and the
Mortgagor is in compliance with the terms and conditions thereof, and is also in
compliance with all other limitations, restrictions, conditions, standards,
prohibitions, requirements, obligations, schedules and timetables contained in
any applicable Environmental
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Law or in any regulation, code, plan, order, decree, judgment, injunction,
notice or demand letter issued, entered, promulgated or approved thereunder.
In addition, except as previously disclosed in writing to the
Mortgagee:
(1) No notice, notification, demand, request for information,
citation, summons or order has been issued, no complaint has been filed,
no penalty has been assessed and no investigation or review is pending or
threatened by any governmental or other entity with respect to any alleged
failure by the Mortgagor to have any environmental, health or safety
permit, license or other authorization required under any Environmental
Law in connection with the conduct of the business of the Mortgagor at the
Properties or with respect to any generation, treatment, storage,
recycling, transportation, discharge or disposal, or any Release of any
Hazardous Materials (as so defined) generated by the Mortgagor at the
Properties.
(2) None of the Properties constitutes a treatment, storage or
disposal facility requiring a permit under the Resource Conservation and
Recovery Act of 1976, as amended, or under any comparable state or local
statute; and
(i) no polychlorinated biphenyls (PCB's) is or has been
present at any of the Properties;
(ii) no asbestos or asbestos-containing materials is or
has been present at any of the Properties;
(iii) there are no underground storage tanks or surface
impoundments for Hazardous Materials, active or abandoned, at any of
the Properties;
(iv) no Hazardous Materials have been Released at, on or
under any of the Properties in a reportable quantity established by
statute, ordinance, rule, regulation or order; and
(v) no Hazardous Materials have been otherwise Released
at, on or under any of the Properties.
(3) No oral or written notification of a Release of a Hazardous
Material has been filed by or on behalf of the Mortgagor and none of the
Properties is listed or proposed for listing on the National Priorities
List under the Comprehensive Environmental Response, Compensation and
Liability Act of 1980, as amended, or under the Comprehensive
Environmental Response and Liability Information System, as provided for
by 40 C.F.R. ss. 300.5 or any similar state list of sites requiring
investigation or clean-up.
(4) No Liens have arisen under or pursuant to any Environmental Laws
on any of the Properties, and no government action has been taken or is in
process that could
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subject any of the Properties to such Liens and the Mortgagor would not be
required to place any notice or restriction relating to the presence of
Hazardous Materials at any of the Properties in any deed therefor.
(5) There have been no environmental investigations, studies,
audits, tests, reviews or other analyses conducted by or that are in the
possession of the Mortgagor in relation to any of the Properties that have
not been made available to the Mortgagee.
As used in this Section 1.09, the following respective terms shall
have the following respective meanings:
"Environmental Laws" means any and all present and future Federal,
state, local and foreign laws, rules or regulations, and any orders or
decrees, in each case as now or hereafter in effect, relating to the
regulation or protection of human health, safety or the environment or to
emissions, discharges, releases or threatened releases of pollutants,
contaminants, chemicals or toxic or hazardous substances or wastes into
the indoor or outdoor environment, including, without limitation, ambient
air, soil, surface water, ground water, wetlands, land or subsurface
strata, or otherwise relating to the manufacture, processing,
distribution, use, treatment, storage, disposal, transport or handling of
pollutants, contaminants, chemicals or toxic or hazardous substances or
wastes.
"Hazardous Material" means, collectively, (i) any petroleum or
petroleum products, flammable explosives, radioactive materials, asbestos
in any form that is or could become friable, urea formaldehyde foam
insulation, and transformers or other equipment that contain dielectric
fluid containing polychlorinated biphenyls (PCB's), (ii) any chemicals or
other materials or substances that are now or hereafter become defined as
or included in the definition of "hazardous substances", "hazardous
wastes", "hazardous materials", "extremely hazardous wastes", "restricted
hazardous wastes", "toxic substances", "toxic pollutants", "contaminants",
"pollutants" or words of similar import under any Environmental Law and
(iii) any other chemical or other material or substance, exposure to which
is now or hereafter prohibited, limited or regulated under any
Environmental Law.
(c) Notification of Notices and Orders. The Mortgagor shall notify
the Mortgagee promptly of any notice or order that the Mortgagor receives from
any agency or instrumentality of the Federal, or any state or local, government
with respect to the Mortgagor's compliance with any laws or regulations referred
to in this Section 1.09 and promptly take any and all actions necessary to bring
its operations at the Properties into compliance with such laws or regulations
(and shall fully comply with the requirements of such laws or regulations that
at any time are applicable to its operations at the Properties) all to the
extent required under the applicable provisions of the Credit Agreement;
provided, that to the extent not inconsistent with the provisions of Section
____ of the Credit Agreement, the Mortgagor at its expense may, after prior
notice to the Mortgagee, contest by appropriate legal, administrative or other
proceedings conducted in good faith and with due diligence, the validity or
application, in whole or in part, of
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any such laws or regulations so long as (i) neither the Mortgage Estate nor any
part thereof or any interest therein, will be sold, forfeited or lost if the
Mortgagor pays the amount or satisfies the condition being contested, and the
Mortgagor would have the opportunity to do so, in the event of the Mortgagor's
failure to prevail in the contest, (ii) neither the Mortgagee nor any of the
Lenders would, by virtue of such permitted contest, be exposed to any risk of
any civil liability for which the Mortgagor has not furnished additional
security as provided in clause (iii) below, or to any risk of criminal
liability, and neither the Mortgage Estate nor any interest therein would be
subject to the imposition of any lien for which the Mortgagor has not furnished
additional security as provided in clause (iii) below as a result of the failure
to comply with such law or of such proceeding and (iii) the Mortgagor shall have
furnished to the Mortgagee additional security in respect of the claim being
contested or the loss or damage that may result from the Mortgagor's failure to
prevail in such contest in such amount as may be reasonably requested by the
Mortgagee[, but only to the extent that such claim or contest and all other
then-current claims or contests involve an aggregate amount greater than
$_________].
(d) Right to Cure Non-Compliance with Environmental Laws. The
Mortgagee, at its election and in its sole discretion may, without obligation to
do so, and upon notice to the Mortgagor (except in an emergency), cure any
failure on the part of the Mortgagor to comply with any laws or regulations
referred to in this Section 1.09, and without limitation, may take any of the
following actions:
(i) arrange for the prevention of any Release or threat of
Release of Hazardous Substances at any of the Properties, and pay any
costs associated with such prevention;
(ii) arrange for the removal or remediation of Hazardous
Substances that may be Released or result from a Release at any of the
Properties, and pay any costs associated with such removal and/or
remediation;
(iii) pay, on behalf of the Mortgagor, any costs, fines or
penalties imposed on the Mortgagor by the Federal, or any state or local,
government or any representative thereof in connection with such Release
or threat of Release of Hazardous Substances; or
(iv) make any other payment or perform any other act that will
prevent a lien in favor of any governmental agency from attaching to any
of the Properties or the Mortgage Estate.
Any partial exercise by the Mortgagee of the remedies hereinafter set forth, or
any partial undertaking on the part of the Mortgagee to cure the Mortgagor's
failure to comply with such laws or regulations, shall not obligate the
Mortgagee to complete the actions taken or require the Mortgagee to expend
further sums to cure the Mortgagor's noncompliance; nor shall the exercise of
any such remedies operate to place upon the Mortgagee any responsibility for the
operation, control, care, management or repair of any of the Properties or make
the Mortgagee the "operator" of any of the Properties within the meaning of any
Environmental Laws. Any amount paid or costs incurred by the Mortgagee as a
result of the exercise by the Mortgagee of any of the
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rights hereinabove set forth, together with interest thereon at the Post-Default
Rate, shall be immediately due and payable by the Mortgagor to the Mortgagee,
and until paid shall be added to and become a part of the Obligations secured
hereby; and the Mortgagee, by making any such payment or incurring any such
costs, shall be subrogated to any rights of the Mortgagor to seek reimbursement
from any third parties, including, without limitation, a predecessor-in-interest
to the Mortgagor's title who may be a "responsible party" or otherwise liable
under any Environmental Law in connection with any such Release or threat of
Release of Hazardous Substances.
(e) Environmental Survey and Risk Assessment. If after the
occurrence and during the continuance of any Event of Default the Mortgagee
desires that an environmental survey and risk assessment with respect to any of
the Properties be prepared, the Mortgagor agrees to supply such a survey and
risk assessment by an independent engineering firm selected by the Mortgagor and
satisfactory to the Mortgagee, in form and detail satisfactory to the Mortgagee
(including test borings of the ground and chemical analyses of air, water and
waste discharges), estimating current liabilities and assessing potential
sources of future liabilities of the Mortgagor or any other owner or operator of
the Properties under applicable Environmental Laws.
(f) Indemnity. Without limiting the provisions of Section 10.03 of
the Credit Agreement, the Mortgagor shall indemnify and hold the Mortgagee and
the Lenders harmless from and against any and all losses, liabilities, claims,
damages or expenses (including any lien filed against the Properties or any part
of the Mortgage Estate in favor of any governmental entity, but excluding any
loss, liability, claim, damage or expense incurred by reason of the gross
negligence or wilful misconduct of the person to be indemnified) arising under
any Environmental Law as a result of the past, present or future operations of
the Mortgagor (or any predecessor in interest to the Mortgagor), or the past,
present or future condition of any of the Properties, or any Release or
threatened Release of any Hazardous Materials from any of the Properties,
excluding any such Release or threatened Release that shall occur during any
period when the Mortgagee or any of the Lenders shall be in possession of any of
the Properties following the exercise by the Mortgagee of any of its rights and
remedies hereunder, but including any such Release or threatened Release
occurring during such period that is a continuation of conditions previously in
existence, or of practices employed by the Mortgagor, at any of the Properties.
Section 1.10. Limitations of Use. The Mortgagor shall not initiate,
join in or consent to any change in any private restrictive covenant, zoning
ordinance or other public or private restrictions limiting or defining the uses
that may be made of any of the Properties and the Improvements or any part
thereof that would have a material adverse effect on the value of any of the
Properties or the Improvements. The Mortgagor shall comply with the provisions
of all leases, licenses, agreements and private covenants, conditions and
restrictions that at any time are applicable to the Mortgage Estate.
Section 1.11. Inspection of the Properties. The Mortgagor shall keep
adequate records and books of account in accordance with GAAP consistently
applied and shall permit the
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Mortgagee and its authorized representatives to enter and inspect the
Properties, to examine the records and books of account of the Mortgagor with
respect thereto and make copies or extracts thereof, all at such reasonable
times as may be requested by the Mortgagee.
Section 1.12. Estoppel Certificates. The Mortgagor, within five days
upon request in person or within ten days upon request by mail, shall furnish
the Mortgagee a written statement, duly acknowledged, of the amount of the
Obligations then secured by this Mortgage and whether any offsets or defenses
exist against any such Obligations.
Section 1.13. Actions to Protect Mortgage Estate. If the Mortgagor
shall fail to (a) perform and observe any of the terms, covenants or conditions
required to be performed or observed by it under the Lease, (b) effect the
insurance required by Section 1.06, (c) make the payments required by Section
1.07 or (d) perform or observe any of its other covenants or agreements
hereunder, the Mortgagee may, without obligation to do so, and upon notice to
the Mortgagor (except in an emergency) effect or pay the same. To the maximum
extent permitted by law, all sums, including reasonable attorneys' fees and
disbursements, so expended or expended to sustain the lien or estate of this
Mortgage or its priority, or to protect or enforce any of the rights hereunder,
or to recover any of the Obligations, shall be a lien on the Mortgage Estate,
shall be deemed to be added to the Obligations secured hereby, and shall be paid
by the Mortgagor within 10 days after demand therefor, together with interest
thereon at the Post-Default Rate.
Section 1.14. Insurance and Condemnation Proceeds.
(a) Restoration Account. Any Casualty or Condemnation Proceeds,
shall, as provided in Section 1.06, be held by the Mortgagee in the Restoration
Account and any interest or other amounts, if any, actually earned on the
balance held by the Mortgagee in the Restoration Account shall be credited to
the Restoration Account, for the benefit of the Mortgagor. So long as no Event
of Default shall have occurred and be continuing, at the written request of the
Mortgagor, any monies held in the Restoration Account shall be invested or
reinvested in such Permitted Investments (as defined in paragraph (b) of this
Section 1.14) as the Mortgagor shall from time to time specify. Such Permitted
Investments shall be held by the Mortgagee pursuant to this Section 1.14; but,
upon request of the Mortgagor, the Mortgagee shall sell all or any designated
part of the same and the proceeds of such sale shall be held by the Mortgagee in
the Restoration Account subject to the provisions hereof in the same manner as
the cash used by it to purchase the Permitted Investments so sold. The Mortgagor
agrees to pay the Mortgagee, on demand, amounts equal to any loss resulting from
any investment or reinvestment pursuant to this Section 1.14 (and any such
payments made by the Mortgagor shall be deposited by the Mortgagee into the
Restoration Account), it being understood that the Mortgagee shall not be liable
or responsible for any such loss.
Notwithstanding anything herein or at law or in equity to the
contrary, none of the Casualty or Condemnation Proceeds paid to the Mortgagee as
herein provided, and none of the other amounts from time to time held in the
Restoration
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Account, shall be deemed trust funds, and the Mortgagee shall be entitled to
advance amounts from time to time held in the Restoration Account to the
Mortgagor, or to apply the same to the prepayment of the loans or other
indebtedness constituting the Obligations hereunder, as provided in Section
1.06(c).
(b) Permitted Investments. For purposes hereof, "Permitted
Investments" means: (i) direct obligations of the United States of America, or
of any agency thereof, or obligations guaranteed as to principal and interest by
the United States of America or any agency thereof, in either case maturing not
more than 90 days from the date of acquisition thereof; (ii) certificates of
deposit issued by any bank or trust company organized under the laws of the
United States of America or any State thereof and having capital, surplus and
undivided profits of at least $500,000,000, maturing not more than 90 days from
the date of acquisition thereof; and (iii) commercial paper rated A-1 or better
or P-1 by Standard & Poor's Ratings Services, a Division of The McGraw-Hill
Companies, Inc., or Moody's Investors Services, Inc., respectively, maturing not
more than 90 days from the date of acquisition thereof.
Section 1.15. Leasehold Interests.
(a) Leasehold Interests Generally. The Mortgagor shall (i) promptly
perform and observe all of the terms, covenants and conditions required to be
performed and observed by the Mortgagor under the Lease and do all things
necessary to preserve and to keep unimpaired its rights thereunder, (ii)
promptly notify the Mortgagee of any default by the Mortgagor under the Lease in
the performance of any of the terms, covenants or conditions on the part of the
Mortgagor to be performed or observed thereunder or of the giving of any notice
by the lessor to the Mortgagor of any default under the Lease or of the lessor's
intention to exercise any remedy reserved to the lessor thereunder and (iii)
promptly cause a copy of each such notice given by the lessor under the Lease to
the Mortgagor to be delivered to the Mortgagee.
(b) Right to Cure Defaults. If the Mortgagor shall fail promptly to
perform or observe any of the terms, covenants or conditions required to be
performed by it under the Lease, including, without limitation, payment of all
rent and other charges due thereunder, the Mortgagee may, without obligation to
do so, and upon notice to the Mortgagor (except in an emergency), take such
action as is appropriate to cause such terms, covenants or conditions to be
promptly performed or observed on behalf of the Mortgagor but no such action by
the Mortgagee shall release the Mortgagor from any of its obligations under this
Mortgage. Upon receipt by the Mortgagee from the lessor under the Lease of any
notice of default by the Mortgagor thereunder, the Mortgagee may rely thereon
and take any action as aforesaid to cure such default even though the existence
of such default or the nature thereof be questioned or denied by the Mortgagor
or by any party on behalf of the Mortgagor.
(c) No Modification Without Consent. The Mortgagor shall not
surrender its leasehold estate and interests under the Lease, nor terminate or
cancel the Lease, and the Mortgagor shall not modify, change, supplement, alter
or amend the Lease orally or in writing, and the Mortgagor does hereby expressly
release, relinquish and surrender unto the Mortgagee all its right, power and
authority, if any, to modify, change, supplement, alter or amend the Lease in
any way, and any attempt on the part of the Mortgagor to exercise any such right
without the consent of the Mortgagee shall be null and void.
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(d) Release or Forbearance. No release or forbearance of any of the
Mortgagor's obligations under the Lease, pursuant to the terms thereof or
otherwise, shall release the Mortgagor from any of its obligations under this
Mortgage.
(e) No Merger of Interests. Neither the fee title to the property
demised by the Lease nor the leasehold estate created by the Lease shall merge,
but shall always remain separate and distinct, notwithstanding the union of the
aforesaid estates either in the lessor or the Mortgagor under the Lease or in a
third party by purchase or otherwise, unless the Mortgagee shall, at its option,
execute and record a document evidencing its intent to merge such estates. If
the Mortgagor acquires the fee title or any other estate, title or interest in
any Leasehold Property covered by the Lease, this Mortgage shall attach to, be a
lien upon and spread to the fee title or such other estate so acquired, and such
fee title or other estate shall, without further assignment, mortgage or
conveyance, become and be subject to the lien of this Mortgage. The Mortgagor
shall notify the Mortgagee of any such acquisition by the Mortgagor and, on
written request by the Mortgagee, shall cause to be executed and recorded all
such other and further assurances or other instruments in writing as may in the
opinion of the Mortgagee be required to carry out the intent and meaning hereof.
(f) Obligations of Lessor. The Mortgagor shall enforce the
obligations of the lessor under the Lease to the end that the Mortgagor may
enjoy all of the rights granted to it under the Lease and shall promptly notify
the Mortgagee of any default by the lessor under the Lease, in the performance
or observance of any of the terms, covenants and conditions on the part of the
lessor to be performed or observed under the Lease and the Mortgagor shall
promptly advise the Mortgagee of the occurrence of any event of default under
the Lease.
(g) No-Default Certificates. The Mortgagor shall use its best
efforts to obtain from the lessor under the Lease and deliver to the Mortgagee,
within 20 days after demand from the Mortgagee, a statement in writing
certifying that the Lease is unmodified and in full force and effect and the
dates to which the rent and other charges, if any, have been paid in advance,
and stating whether or not, to the best knowledge of the signer of such
certificate, the Mortgagor is in default in the performance of any covenant,
agreement or condition contained in the Lease, and, if so, specifying each such
default of which the signer may have knowledge.
(h) Renewals and Extensions. Unless the exercise of any option, now
existing or hereafter created, to renew or extend the term of the Lease would,
in the Mortgagor's reasonable business judgment, be inadvisable, the Mortgagor
shall, at least six months prior to the last day upon which the Mortgagor may
validly exercise such option, (i) exercise such option in such manner as will
cause the term of the Lease to be effectively renewed or extended for the period
provided by such option and (ii) give immediate notice thereof to the Mortgagee,
it being understood that in the event of the failure of the Mortgagor to do so,
the Mortgagee shall have, and is hereby granted, the irrevocable right to
exercise any such option, either in its own name and behalf, or in the name and
behalf of the Mortgagor, as the Mortgagee shall in its sole discretion
determine.
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(i) Notifications of Changes in Rent. The Mortgagor shall promptly
notify the Mortgagee of any change in the rent or other charges payable under
the Lease, except for changes made pursuant to the provisions of the Lease.
(j) Notifications Concerning Proceeds.In the event that any proceeds
of insurance on any part of the Mortgage Estate, or any Condemnation Proceeds,
shall be deposited with any person pursuant to the requirements of the Lease,
the Mortgagor shall promptly notify the Mortgagee of the name and address of the
person with whom such proceeds have been deposited and of the amount so
deposited.
Section 1.16. Notice Regarding Special Flood Hazards. The Mortgagor
hereby acknowledges that it realizes that the following Properties are in zones
identified by the Director of the Federal Emergency Management Agency as special
flood hazard zones described in 12 C.F.R. ss. 22.2 and that it has received,
prior to the making of the Loans and the incurrence of any other indebtedness
constituting part of the Obligations secured by this Mortgage, the notice
regarding Federal disaster relief assistance referred to in the Appendix to 12
C.F.R. Part 22:
[List Properties located in special flood hazard zones].
ARTICLE 2
Assignment of Rents, Issues and Profits
Section 2.01. Assignment of Rents, Issues and Profits. The Mortgagor
hereby assigns and transfers to the Mortgagee, FOR THE PURPOSE OF SECURING the
Obligations, all Rents, and hereby gives to and confers upon the Mortgagee the
right, power and authority to collect the same. The Mortgagor irrevocably
appoints the Mortgagee its true and lawful attorney-in-fact, at its option at
any time and from time to time following the occurrence and during the
continuance of an Event of Default, to demand, receive and enforce payment, to
give receipts, releases and satisfactions, and to sue, in the name of the
Mortgagor or otherwise, for Rents and apply the same to the Obligations as
provided in paragraph (a) of Section 4.03; provided, however, that the Mortgagor
shall have the right to collect Rents at any time prior to the occurrence of an
Event of Default (but not more than one month in advance, except in the case of
security deposits).
Section 2.02. Collection Upon Default. To the extent permitted by
law, upon the occurrence of any Event of Default, the Mortgagee may, at any time
without notice, either in person, by agent or by a receiver appointed by a
court, and without regard to the adequacy of any security for the Obligations or
the solvency of the Mortgagor, enter upon and take possession of the Properties,
the Improvements and the Fixtures or any part thereof, in its own name, sue for
or otherwise collect Rents including those past due and unpaid, and, apply the
same, less costs and expenses of operation and collection, including attorneys'
fees and disbursements, to the payment of the Obligations as provided in
paragraph (a) of Section 4.03, and in such order as the Mortgagee may determine.
The collection of Rents or the entering upon and taking possession of
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the Properties, the Improvements or the Fixtures or any part thereof, or the
application thereof as aforesaid, shall not cure or waive any Event of Default
or notice thereof or invalidate any act done in response to such Event of
Default or pursuant to notice thereof.
ARTICLE 3
Security Agreement
Section 3.01. Creation of Security Interest. The Mortgagor hereby
grants to the Mortgagee a security interest in the Fixtures for the purpose of
securing the Obligations. The Mortgagee shall have, in addition to all rights
and remedies provided herein and in the other Loan Instruments, all the rights
and remedies of a secured party under the Uniform Commercial Code of the state
in which the applicable portion of the Fixtures is located.
Section 3.02. Warranties, Representations and Covenants. The
Mortgagor hereby warrants, represents and covenants that: (a) the Fixtures will
be kept on or at the related Properties and the Mortgagor will not remove any
Fixtures from the related Properties, except such portions or items of the
Fixtures that are consumed or worn out in ordinary usage, all of which shall be
promptly replaced by the Mortgagor, except as otherwise expressly provided in
Section 1.08, (b) all covenants and obligations of the Mortgagor contained
herein relating to the Mortgage Estate shall be deemed to apply to the Fixtures
whether or not expressly referred to herein and (c) this Mortgage constitutes a
security agreement and "fixture filing" as those terms are used in the
applicable Uniform Commercial Code. Information relative to the security
interest created hereby may be obtained by application to the Mortgagee (secured
party) c/o The Chase Manhattan Bank, 1 Chase Manhattan Plaza, New York, New York
10081. The mailing address of the Mortgagor is set forth on Page 1 hereof.
ARTICLE 4
Defaults; Remedies
Section 4.01. Defaults. If one or more of the following events
(herein called "Events of Default") shall occur and be continuing:
(a) the Borrower or the Mortgagor shall (i) default in the payment
of any principal of any of the loans or other indebtedness constituting
part of the Obligations hereunder when due (whether at stated maturity or
at mandatory or optional prepayment), or (ii) default in the payment of
any interest on any of the loans or other indebtedness constituting part
of the Obligations hereunder when due and such default shall have
continued unremedied for ***;
(b) any representation, warranty or certification made or deemed
made herein (or in any modification or supplement hereto) by the
Mortgagor, or any certificate furnished
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to the Mortgagee pursuant to the provisions hereof, shall prove to have
been false or misleading as of the time made or furnished in any material
respect;
(c) the Mortgagor shall default in the performance of any of its
obligations under any of Sections ___ or ___, or the Mortgagor shall
default in the performance of any of its obligations under any other
provision hereof and such default shall continue unremedied for a period
of ____ days after notice thereof to the Mortgagor by the Mortgagee;
(d) the Borrower or the Mortgagor shall admit in writing its
inability to, or be generally unable to, pay its debts as such debts
become due;
(e) the Borrower or the Mortgagor shall (i) apply for or consent to
the appointment of, or the taking of possession by, a receiver, custodian,
trustee, examiner or liquidator of itself or of all or a substantial part
of its property, (ii) make a general assignment for the benefit of its
creditors, (iii) commence a voluntary case under the Bankruptcy Code, (iv)
file a petition seeking to take advantage of any other law relating to
bankruptcy, insolvency, reorganization, liquidation, dissolution,
arrangement or winding-up, or composition or readjustment of debts, (v)
fail to controvert in a timely and appropriate manner, or acquiesce in
writing to, any petition filed against it in an involuntary case under the
Bankruptcy Code, or (vi) take any corporate action for the purpose of
effecting any of the foregoing;
(f) a proceeding or case shall be commenced, without the application
or consent of the Borrower or the Mortgagor, in any court of competent
jurisdiction, seeking (i) its reorganization, liquidation, dissolution,
arrangement or winding-up, or the composition or readjustment of its
debts, (ii) the appointment of a receiver, custodian, trustee, examiner,
liquidator or the like of the Borrower or the Mortgagor or of all or any
substantial part of its property, or (iii) similar relief in respect of
the Borrower or the Mortgagor under any law relating to bankruptcy,
insolvency, reorganization, winding-up, or composition or adjustment of
debts, and such proceeding or case shall continue undismissed, or an
order, judgment or decree approving or ordering any of the foregoing shall
be entered and continue unstayed and in effect, for a period of 60 or more
days; or an order for relief against the Borrower or the Mortgagor shall
be entered in an involuntary case under the Bankruptcy Code;
(g) a reasonable basis shall exist for the assertion against the
Mortgagor of (or there shall have been asserted against the Mortgagor)
claims or liabilities, whether accrued, absolute or contingent, based on
or arising from the generation, storage, transport, handling or disposal
of Hazardous Materials by the Mortgagor, or any other person, with respect
to the Properties or Improvements, which claims or liabilities (insofar as
they are payable by the Mortgagor but after deducting any portion thereof
that is reasonably expected to be paid by other creditworthy persons
jointly and severally liable therefor), in the judgment of the Required
Lenders under the Credit Agreement are reasonably likely to be determined
adversely to the Mortgagor, and the amount thereof is,
Mortgage
<PAGE>
-22-
singly or in the aggregate, reasonably likely to materially adversely
affect the value of the Properties or Improvements; or
(h) any other event or condition shall occur that constitutes an
"Event of Default" under and as defined in the Credit Agreement shall
occur and be continuing;
THEREUPON, as more particularly provided in the Credit Agreement: (1) in the
case of an Event of Default other than one referred to in clause (e) or (f) of
this Section 4.01 the Mortgagee may, by notice to the Mortgagor, declare the
principal amount then outstanding of, and the accrued interest on, the loans and
other indebtedness constituting the Obligations hereunder to be forthwith due
and payable, whereupon such amounts shall be immediately due and payable without
presentment, demand, protest or other formalities of any kind, all of which have
been expressly waived by the Borrower pursuant to the provisions of the Credit
Agreement; and (2) in the case of the occurrence of an Event of Default referred
to in clause (e) or (f) of this Section 4.01, the principal amount then
outstanding of, and the accrued interest on, the loans and other indebtedness
constituting the Obligations hereunder shall automatically become immediately
due and payable without presentment, demand, protest or other formalities of any
kind, all of which have been expressly waived by the Borrower pursuant to the
provisions of the Credit Agreement.
Section 4.02. Default Remedies.
(a) Remedies Generally. If an Event of Default shall have occurred
and be continuing, this Mortgage may, to the maximum extent permitted by law, be
enforced, and the Mortgagee may exercise any right, power or remedy permitted to
it hereunder, under the Credit Agreement or under any of the other Loan
Instruments or by law, and, without limiting the generality of the foregoing,
the Mortgagee may, personally or by its agents, to the maximum extent permitted
by law:
(i) enter into and take possession of the Mortgage Estate or
any part thereof, exclude the Mortgagor and all persons claiming under the
Mortgagor whose claims are junior to this Mortgage, wholly or partly
therefrom, and use, operate, manage and control the same either in the
name of the Mortgagor or otherwise as the Mortgagee shall deem best, and
upon such entry, from time to time at the expense of the Mortgagor and the
Mortgage Estate, make all such repairs, replacements, alterations,
additions or improvements to the Mortgage Estate or any part thereof as
the Mortgagee may deem proper and, whether or not the Mortgagee has so
entered and taken possession of the Mortgage Estate or any part thereof,
collect and receive all Rents and apply the same to the payment of all
expenses that the Mortgagee may be authorized to make under this Mortgage,
the remainder to be applied to the payment of the Obligations until the
same shall have been repaid in full; if the Mortgagee demands or attempts
to take possession of the Mortgage Estate or any portion thereof in the
exercise of any rights hereunder, the Mortgagor shall promptly turn over
and deliver complete possession thereof to the Mortgagee; and
Mortgage
<PAGE>
-23-
(ii) personally or by agents, with or without entry, if the
Mortgagee shall deem it advisable:
(x) sell the Mortgage Estate at a sale or sales held at such
place or places and time or times and upon such notice and otherwise
in such manner as may be required by law, or, in the absence of any
such requirement, as the Mortgagee may deem appropriate, and from
time to time adjourn any such sale by announcement at the time and
place specified for such sale or for such adjourned sale without
further notice, except such as may be required by law; [without
limiting the generality of the foregoing provisions of this clause
(x), the Mortgagee shall be authorized at its option, whether or not
possession of the Mortgage Estate is taken, to sell the Mortgage
Estate (or such part or parts thereof as the Mortgagee may elect to
sell) under the power of sale hereby given to the Mortgagee, at
public outcry, to the highest bidder for cash, at the main door of
the courthouse of _____ County, Alabama, after first giving notice
by publication once a week for three successive weeks of the time,
place and terms of such sale, together with a description of the
Mortgage Estate to be sold, by publication in some newspaper
published in said county, which sale shall be held between the hours
of 11;00 a.m. and 4:00 p.m. on the date designated for the exercise
of power of sale hereunder;](1)
(y) proceed to protect and enforce its rights under this
Mortgage, by suit for specific performance of any covenant contained
herein or in the Loan Instruments or in aid of the execution of any
power granted herein or in the Loan Instruments, or for the
foreclosure of this Mortgage (as a mortgage or otherwise) and the
sale of the Mortgage Estate under the judgment or decree of a court
of competent jurisdiction, or for the enforcement of any other right
as the Mortgagee shall deem most effectual for such purpose,
provided, that in the event of a sale, by foreclosure or otherwise,
of less than all of the Mortgage Estate, this Mortgage shall
continue as a lien on, and security interest in, the remaining
portion of the Mortgage Estate; or
(z) exercise any or all of the remedies available to a secured
party under the applicable Uniform Commercial Code, including,
without limitation:
(1) either personally or by means of a court appointed
receiver, take possession of all or any of the Fixtures and
exclude therefrom the Mortgagor and all persons claiming under
the Mortgagor, and thereafter hold, store, use, operate,
manage, maintain and control, make repairs, replacements,
alterations, additions and improvements to and exercise all
rights and powers of the Mortgagor in respect of the Fixtures
or any part thereof; if the Mortgagee demands or attempts to
take possession of the Fixtures in the exercise of any rights
hereunder, the Mortgagor shall
- --------
(1) Include in an Alabama mortgage
Mortgage
<PAGE>
-24-
promptly turn over and deliver complete possession thereof to
the Mortgagee;
(2) without notice to or demand upon the Mortgagor, make
such payments and do such acts as the Mortgagee may deem
necessary to protect its security interest in the Fixtures,
including, without limitation, paying, purchasing, contesting
or compromising any encumbrance that is prior to or superior
to the security interest granted hereunder, and in exercising
any such powers or authority paying all expenses incurred in
connection therewith;
(3) require the Mortgagor to assemble the Fixtures or
any portion thereof, at a place designated by the Mortgagee
and reasonably convenient to both parties, and promptly to
deliver the Fixtures to the Mortgagee, or an agent or
representative designated by it; the Mortgagee, and its agents
and representatives, shall have the right to enter upon the
premises and property of the Mortgagor to exercise the
Mortgagee's rights hereunder; and
(4) sell, lease or otherwise dispose of the Fixtures,
with or without having the Fixtures at the place of sale, and
upon such terms and in such manner as the Mortgagee may
determine (and the Mortgagee or any Lender may be a purchaser
at any such sale).
(b) Appointment of Receiver. If an Event of Default shall have
occurred and be continuing, the Mortgagee, to the maximum extent permitted by
law, shall be entitled, as a matter of right, to the appointment of a receiver
of the Mortgage Estate, without notice or demand, and without regard to the
adequacy of the security for the Obligations or the solvency of the Mortgagor.
The Mortgagor hereby irrevocably consents to such appointment and waives notice
of any application therefor. Any such receiver or receivers shall have all the
usual powers and duties of receivers in like or similar cases and all the powers
and duties of the Mortgagee in case of entry and shall continue as such and
exercise all such powers until the date of confirmation of sale of the Mortgage
Estate, unless such receivership is sooner terminated.
(c) Rents. If an Event of Default shall have occurred and be
continuing, the Mortgagor shall, to the maximum extent permitted by law, pay
monthly in advance to the Mortgagee, or to any receiver appointed at the request
of the Mortgagee to collect Rents, the fair and reasonable rental value for the
use and occupancy of the Properties, the Improvements and the Fixtures or of
such part thereof as may be in the possession of the Mortgagor. Upon default in
the payment thereof, the Mortgagor shall vacate and surrender possession of the
Properties, the Improvements and the Fixtures to the Mortgagee or such receiver,
and upon a failure so to do may be evicted by summary proceedings.
(d) Sale. In any sale under any provision of this Mortgage or
pursuant to any judgment or decree of court, the Mortgage Estate, to the maximum
extent permitted by law, may
Mortgage
<PAGE>
-25-
be sold in one or more parcels or as an entirety and in such order as the
Mortgagee may elect, without regard to the right of the Mortgagor or any person
claiming under the Mortgagor to the marshalling of assets. The purchaser at any
such sale shall take title to the Mortgage Estate or the part thereof so sold
free and discharged of the estate of the Mortgagor therein, the purchaser being
hereby discharged from all liability to see to the application of the purchase
money. Any person, including the Mortgagee or any Lender, may purchase at any
such sale. Upon the completion of any such sale by virtue of this Section 4.02
the Mortgagee shall execute and deliver to the purchaser an appropriate
instrument that shall effectively transfer all of the Mortgagor's estate, right,
title, interest, property, claim and demand in and to the Mortgage Estate or
portion thereof so sold, but without any covenant or warranty, express or
implied. The Mortgagee is hereby irrevocably appointed the attorney-in-fact of
the Mortgagor in its name and stead to make all appropriate transfers and
deliveries of the Mortgage Estate or any portions thereof so sold and, for that
purpose, the Mortgagee may execute all appropriate instruments of transfer, and
may substitute one or more persons with like power, the Mortgagor hereby
ratifying and confirming all that said attorneys or such substitute or
substitutes shall lawfully do by virtue hereof. Nevertheless, the Mortgagor
shall ratify and confirm, or cause to be ratified and confirmed, any such sale
or sales by executing and delivering, or by causing to be executed and
delivered, to the Mortgagee or to such purchaser or purchasers all such
instruments as may be advisable, in the judgment of the Mortgagee, for such
purpose, and as may be designated in such request. Any sale or sales made under
or by virtue of this Mortgage, to the extent not prohibited by law, shall
operate to divest all the estate, right, title, interest, property, claim and
demand whatsoever, whether at law or in equity, of the Mortgagor in, to and
under the Mortgage Estate, or any portions thereof so sold, and shall be a
perpetual bar both at law and in equity against the Mortgagor and against any
and all persons claiming or who may claim the same, or any part thereof, by,
through or under the Mortgagor. The powers and agency herein granted are coupled
with an interest and are irrevocable.
(e) Possession of Loan Instruments Not Necessary. All rights of
action under the Loan Instruments and this Mortgage may be enforced by the
Mortgagee without the possession of the Loan Instruments and without the
production thereof at any trial or other proceeding relative thereto.
Section 4.03. Application of Proceeds.
(a) Application of Proceeds Generally. The proceeds of any sale made
either under the power of sale hereby given or under a judgment, order or decree
made in any action to foreclose or to enforce this Mortgage, or of any monies
held by the Mortgagee hereunder shall, to the maximum extent permitted by law,
be applied:
(i) first to the payment of all costs and expenses of such
sale, including the Mortgagee's attorneys' fees and disbursements;
(ii) then to the payment of all charges, expenses and advances
incurred or made by the Mortgagee in order to protect the lien and estate
of this Mortgage or the security afforded hereby;
Mortgage
<PAGE>
-26-
(iii) then to the payment in full of the Obligations, ratably
in accordance with the respective amounts then due and owing or as the
Lenders may otherwise agree;
and after payment in full of all Obligations any surplus remaining shall be paid
to the Mortgagor or to whomsoever may be lawfully entitled to receive the same.
(b) Liability for Deficiencies. No sale or other disposition of all
or any part of the Mortgage Estate pursuant to Section 4.02 shall be deemed to
relieve the Mortgagor of its obligations under the Credit Agreement or any other
Loan Instrument except to the extent the proceeds thereof are applied to the
payment of such obligations. If the proceeds of sale, collection or other
realization of or upon the Mortgage Estate are insufficient to cover the costs
and expenses of such realization and the payment in full of the Obligations, the
Mortgagor shall remain liable for any deficiency.
Section 4.04. Right to Sue. The Mortgagee shall have the right from
time to time to sue for any sums required to be paid by the Mortgagor under the
terms of this Mortgage as the same become due, without regard to whether or not
the Obligations shall be, or have become, due and without prejudice to the right
of the Mortgagee thereafter to bring any action or proceeding of foreclosure or
any other action upon the occurrence of any Event of Default existing at the
time such earlier action was commenced.
Section 4.05. Powers of the Mortgagee. The Mortgagee may at any time
or from time to time renew or extend this Mortgage or (with the agreement of the
Mortgagor) alter or modify the same in any way, or waive any of the terms,
covenants or conditions hereof or thereof, in whole or in part, and may release
any portion of the Mortgage Estate or any other security, and grant such
extensions and indulgences in relation to the Obligations, or release any person
liable therefor as the Mortgagee may determine without the consent of any junior
lienor or encumbrancer, without any obligation to give notice of any kind
thereto, without in any manner affecting the priority of the lien and estate of
this Mortgage on or in any part of the Mortgage Estate, and without affecting
the liability of any other person liable for any of the Obligations.
Section 4.06. Remedies Cumulative.
(a) Remedies Cumulative. No right or remedy herein conferred upon or
reserved to the Mortgagee is intended to be exclusive of any other right or
remedy, and each and every right and remedy shall be cumulative and in addition
to any other right or remedy under this Mortgage, or under applicable law,
whether now or hereafter existing; the failure of the Mortgagee to insist at any
time upon the strict observance or performance of any of the provisions of this
Mortgage or to exercise any right or remedy provided for herein or under
applicable law, shall not impair any such right or remedy nor be construed as a
waiver or relinquishment thereof.
Mortgage
<PAGE>
-27-
(b) Other Security. The Mortgagee shall be entitled to enforce
payment and performance of any of the obligations of the Mortgagor and to
exercise all rights and powers under this Mortgage or under any Loan Instrument
or any laws now or hereafter in force, notwithstanding that some or all of the
Obligations may now or hereafter be otherwise secured, whether by mortgage, deed
of trust, pledge, lien, assignment or otherwise; neither the acceptance of this
Mortgage nor its enforcement, whether by court action or pursuant to the power
of sale or other powers herein contained, shall prejudice or in any manner
affect the Mortgagee's right to realize upon or enforce any other security now
or hereafter held by the Mortgagee, it being stipulated that the Mortgagee shall
be entitled to enforce this Mortgage and any other security now or hereafter
held by the Mortgagee in such order and manner as the Mortgagee, in its sole
discretion, may determine; every power or remedy given by the Credit Agreement,
this Mortgage or any of the other Loan Instruments to the Mortgagee, or to which
the Mortgagee is otherwise entitled, may be exercised, concurrently or
independently, from time to time and as often as may be deemed expedient by the
Mortgagee, and the Mortgagee may pursue inconsistent remedies.
Section 4.07. Waiver of Stay, Extension, Moratorium Laws; Equity of
Redemption. To the maximum extent permitted by law, the Mortgagor shall not at
any time insist upon, or plead, or in any manner whatever claim or take any
benefit or advantage of any applicable present or future stay, extension or
moratorium law, that may affect observance or performance of the provisions of
this Mortgage; nor claim, take or insist upon any benefit or advantage of any
present or future law providing for the valuation or appraisal of the Mortgage
Estate or any portion thereof prior to any sale or sales thereof that may be
made under or by virtue of Section 4.02; and the Mortgagor, to the extent that
it lawfully may, hereby waives all benefit or advantage of any such law or laws.
The Mortgagor for itself and all who may claim under it, hereby waives, to the
maximum extent permitted by applicable law, any and all rights and equities of
redemption from sale under the power of sale created hereunder or from sale
under any order or decree of foreclosure of this Mortgage and (if an Event of
Default shall have occurred) all notice or notices of seizure, and all right to
have the Mortgage Estate marshalled upon any foreclosure hereof. The Mortgagee
shall not be obligated to pursue or exhaust its rights or remedies as against
any other part of the Mortgage Estate and the Mortgagor hereby waives any right
or claim of right to have the Mortgagee proceed in any particular order.
ARTICLE 5
Miscellaneous
Section 5.01. Release by the Mortgagee. Upon the termination of the
Commitments under and as defined in the Credit Agreement and the payment in full
of the Obligations, the Mortgagee shall release the lien of this Mortgage, or
upon the request of the Mortgagor, and at the Mortgagor's expense, assign this
Mortgage without recourse to the Mortgagor's designee, or to the person or
persons legally entitled thereto, by an instrument duly acknowledged in form for
recording.
Mortgage
<PAGE>
-28-
Section 5.02. Notices. All notices, demands, consents, requests or
other communications that are permitted or required to be given by any party to
the other hereunder shall be in writing and given in the manner specified in
Section 10.01 of the Credit Agreement.
Section 5.03. Amendments; Waivers; Etc. This Mortgage cannot be
modified, changed or discharged except by an agreement in writing, duly
acknowledged in form for recording, signed by the Mortgagor and the Mortgagee
with the consent of the Lenders as provided in the Credit Agreement. For
purposes hereof, a statement by the Mortgagee in any modification or supplement
to this Mortgage to the effect that such modification or supplement has been
consented to by the Lenders as provided in the Credit Agreement shall be
conclusive evidence of such consent and it shall not be necessary for a copy of
such consent to be recorded with such modification or supplement as a condition
to such modification or supplement being recorded in the appropriate real estate
records.
Section 5.04. Successors and Assigns. This Mortgage applies to,
inures to the benefit of and binds the Mortgagor and the Mortgagee and their
respective successors and assigns and shall run with the Properties.
Section 5.05. Captions. The captions or headings at the beginning of
Articles, Sections and paragraphs hereof are for convenience of reference and
are not a part of this Mortgage.
Section 5.06. Severability. If any term or provision of this
Mortgage or the application thereof to any person or circumstance shall to any
extent be invalid or unenforceable, the remainder of this Mortgage, or the
application of such term or provision to persons or circumstances other than
those as to which it is invalid or unenforceable, shall not be affected thereby,
and each term and provision of this Mortgage shall be valid and enforceable to
the maximum extent permitted by law. If any portion of the Obligations shall for
any reason not be secured by a valid and enforceable lien upon any part of the
Mortgage Estate, then any payments made in respect of the Obligations (whether
voluntary or under foreclosure or other enforcement action or procedure or
otherwise) shall, for purposes of this Mortgage (except to the extent otherwise
required by applicable law) be deemed to be made (i) first, in respect of the
portion of the Obligations not secured by the lien of this Mortgage, (ii)
second, in respect of the portion of the Obligations secured by the lien of this
Mortgage, but which lien is on less than all of the Mortgage Estate, and (iii)
last, to the portion of the Obligations secured by the lien of this Mortgage,
and which lien is on all of the Mortgage Estate.
IN WITNESS WHEREOF, this Mortgage has been duly executed by the
Mortgagor as of the day and year first above written.
[ ]
By _______________________________
Title:
Mortgage
<PAGE>
-29-
Signed and acknowledged
in the presence of:
_________________________
_________________________
Mortgage
<PAGE>
-30-
STATE OF NEW YORK )
) ss:
COUNTY OF NEW YORK )
On this __ day of _______, 1999, before me, the undersigned, a notary public in
and for said state, personally appeared ______________, personally known to me
or proved to me on the basis of satisfactory evidence to be the individual whose
name is subscribed to the within instrument, and acknowledged to me that he/she
executed the same in his/her capacity and that by his/her signature on the
instrument the individual or the person upon behalf of which the individual
acted executed the instrument.
___________________________
Notary Public
[SEAL]
Mortgage
<PAGE>
SCHEDULE I
DESCRIPTION OF FEE PROPERTY
The following land and premises located in ___________________
County, ____________:
[Insert metes and bounds description]
Schedule I
<PAGE>
SCHEDULE II
DESCRIPTION OF LEASE
AND LEASEHOLD PROPERTY
That certain [lease/lease agreement] dated as of _______________,
19__ between the Mortgagor [as successor by merger] [assignment] to
____________, a [corporation] [partnership] duly organized and validly existing
under the laws of the State of _____________, as lessee, and __________, a
[corporation] [partnership] duly organized and validly existing under the laws
of the State of _____________, as lessor, and recorded in volume ___ at page ___
of the ________ Records of ________ County, __________ on ______________, 19__,
and the leasehold estate created thereby affecting the following land and
premises located in ______________ County, _________:
[Insert metes and bounds description]
Schedule II
<PAGE>
EXECUTION COPY
WARRANT AGREEMENT
Dated as of
April 12, 1999
between
CHART INDUSTRIES, INC.
and
each of the persons listed on the signature pages hereto
Warrants for
Common Stock of
CHART INDUSTRIES, INC.
<PAGE>
TABLE OF CONTENTS
Page
----
ARTICLE 1 DEFINITIONS.............................................1
SECTION 1.1 Definitions..........................................1
SECTION 1.2. Other Definitions...................................2
SECTION 1.3. Rules of Construction...............................3
ARTICLE 2 WARRANT CERTIFICATES....................................3
SECTION 2.1. Form and Dating.....................................3
SECTION 2.2. Legends.............................................4
SECTION 2.3. Transfer Provisions.................................4
SECTION 2.4. Replacement Certificates............................5
ARTICLE 3 EXERCISE TERMS..........................................5
SECTION 3.1. Exercise Price......................................5
SECTION 3.2. Exercise Period; Restrictions on Exercise...........5
SECTION 3.3. Expiration..........................................5
SECTION 3.4. Manner of Exercise..................................5
SECTION 3.5. Issuance of Warrant Shares..........................6
SECTION 3.6. Fractional Warrant Shares...........................7
SECTION 3.7. Reservation of Warrant Shares.......................7
ARTICLE 4 ANTIDILUTION PROVISIONS.................................8
SECTION 4.1. Changes in Common Stock.............................8
SECTION 4.2. Rights Issue to All Holders of Common Stock.........8
SECTION 4.3. Combination; Liquidation............................8
SECTION 4.4. Other Events........................................9
SECTION 4.5. Minimum Adjustment..................................9
SECTION 4.6. Notice of Adjustment...............................10
SECTION 4.7. Notice of Certain Transactions.....................10
SECTION 4.8. Adjustment to Warrant Certificate..................11
ARTICLE 5 REGISTRATION RIGHTS....................................11
SECTION 5.1. Effectiveness of Registration Statement............11
SECTION 5.2. Suspension.........................................12
SECTION 5.3. Blue Sky...........................................12
i
<PAGE>
SECTION 5.4. Accuracy of Disclosure.............................12
SECTION 5.5. Indemnification....................................13
SECTION 5.6. Additional Acts....................................16
SECTION 5.7. Expenses...........................................16
ARTICLE 6 MISCELLANEOUS..........................................17
SECTION 6.1. Reports of the Company.............................17
SECTION 6.2. Rights of Holders..................................17
SECTION 6.3. Amendment..........................................17
SECTION 6.4. Notices............................................18
SECTION 6.5. Governing Law......................................18
SECTION 6.6. Successors.........................................18
SECTION 6.7. Multiple Originals.................................18
SECTION 6.8. Table of Contents..................................18
SECTION 6.9. Severability.......................................19
EXHIBIT A Form of Face of Warrant Certificate
ii
<PAGE>
WARRANT AGREEMENT dated as of April 12, 1999 (this "Agreement"),
between CHART INDUSTRIES, INC. a Delaware corporation (the "Company") and the
persons listed on the signature pages hereto (each a "Holder" and, collectively,
the "Holders").
WHEREAS, the Company, MVE Holdings, Inc., a Delaware corporation,
and certain former members of MVE Investors LLC, a Delaware limited liability
company, have executed an Indemnification and Warrant Purchase Agreement dated
as of April 12, 1999 (the "Indemnification and Warrant Purchase Agreement");
WHEREAS, pursuant to the Indemnification and Warrant Purchase
Agreement, the Company may be obligated to issue up to an aggregate of 1,000,000
warrants (each a "Warrant" and collectively, "Warrants"), as described herein,
which will initially entitle the Holders to purchase from time to time up to an
aggregate of 1,000,000 shares of common stock, par value $0.01 per share (the
"Common Stock"), of the Company at a purchase price of $10.00 per share, subject
to the adjustments described herein;
NOW, THEREFORE, the parties hereto agree as follows:
ARTICLE 1
Definitions
SECTION 1.1. Definitions.
"Affiliate" means with respect to any Person, any other Person
controlling, controlled by or under common control with such particular Person,
where "control" means the possession, directly or indirectly, of the power to
direct the management and policies of a Person whether through the ownership of
voting securities, contract or otherwise or, with respect to any Holder, any
member, officer, director, shareholder, partner (general or limited) or employee
of such Person.
"Board" means the Board of Directors of the Company or any committee
thereof duly authorized to act on behalf of such Board of Directors.
"Business Day" means each day other than Saturday, Sunday or a day
on which banking institutions are not required to be open in the State of New
York.
"Cashless Exercise Ratio" means a fraction, the numerator of which
is the excess of the Current Market Value per share of Common Stock on the
Exercise Date over the Exercise Price per share as of the Exercise Date and the
denominator of which is the Current Market Value per share of the Common Stock
on the Exercise Date.
"Combination" means an event in which the Company consolidates with,
merges with or into, or sells all or substantially all of its assets to another
Person.
<PAGE>
"Commission" means the Securities and Exchange Commission, or any
successor agency or body performing substantially similar functions.
"Current Market Value" per share of Common Stock or any other
security of the Company at any date means the last reported sale price of the
Common Stock on the Business Day immediately preceding such date as officially
reported by the New York Stock Exchange, or if not then traded on the New York
Stock Exchange, as reported in the Nasdaq National Market System ("Nasdaq") for
such Business Day, or if the Common Stock is not listed or admitted to trading
on any national securities exchange or quoted on Nasdaq, the closing bid price
for such Business Day as furnished by the National Association of Securities
Dealers, Inc. through Nasdaq or similar organization if Nasdaq is no longer
reporting such information.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended.
"Exercise Date" means, for a given Warrant, the day on which such
Warrant is exercised pursuant to Section 3.4.
"Issue Date" means the date the Warrants are issued.
"Person" means any individual, corporation, partnership, joint
venture, limited liability company, association, joint-stock company, trust,
unincorporated organization, government or any agency or political subdivision
thereof or any other entity.
"Securities Act" means the Securities Act of 1933, as amended.
"Warrant Certificate" means a registered certificate issued by the
Company under this Agreement representing a Warrant.
"Warrant Shares" mean the shares of Common Stock (and any other
securities) for which the Warrants are exercisable.
SECTION 1.2. Other Definitions.
Defined in
Term Section
---- -------
"Agreement" .......................................Recitals
"Cashless Exercise"................................3.4
"Combination Agent"................................4.3(b)
"Common Stock".....................................Recitals
"Company"..........................................Recitals
"Company Indemnified Parties"......................5.5(b)
"Delivering Seller"................................5.5(a)
"Exercise Price"...................................3.1
"Expiration Date"..................................3.2
"Holder"...........................................Recitals
2
<PAGE>
"Indemnification and Warrant Purchase Agreement....Recitals
"Holder Indemnified Parties".......................5.5(a)
"Nasdaq"...........................................1.1
"Notes"............................................Recitals
"Period"...........................................1.1
"Private Placement Legend..........................2.2(b)
"Successor Company"................................4.3(a)
"Transfer Agent"...................................3.5
"Warrant Shares Registration Statement"............5.1
"Warrants".........................................Recitals
SECTION 1.3. Rules of Construction. Unless the text otherwise
requires:
(i) a defined term has the meaning assigned to it;
(ii) an accounting term not otherwise defined has the meaning
assigned to it in accordance with generally accepted accounting
principles as in effect from time to time;
(iii) "or" is not exclusive;
(iv) "including" means including without limitation; and
(v) words in the singular include the plural and words in the
plural include the singular.
ARTICLE 2
Warrant Certificates
SECTION 2.1. Form and Dating. Each Warrant Certificate shall be
issued in registered form only, substantially in the form of Exhibit A. The
Warrant Certificates may have notations, legends or endorsements required by
law, stock exchange rule, agreements to which the Company is subject, if any, or
usage (including CUSIP numbers) (provided that any such notation, legend or
endorsement is in a form acceptable to the Company) and shall bear the legends
required by Section 2.2.
The terms and provisions contained in the form of Warrant annexed
hereto as Exhibit A shall constitute, and are hereby expressly made, a part of
this Agreement. The Company and the Holders, by their execution and delivery of
this Agreement, agree to such terms and provisions and to be bound thereby.
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SECTION 2.2. Legends. (a) Each Warrant Certificate shall bear the
following legend:
THIS WARRANT ENTITLES THE HOLDER TO PURCHASE ____ SHARES OF COMMON STOCK
OF THE COMPANY AT A PURCHASE PRICE OF $10.00 PER SHARE, SUBJECT TO
ADJUSTMENT UNDER CERTAIN CIRCUMSTANCES. A COPY OF THE WARRANT AGREEMENT
PURSUANT TO WHICH THE WARRANTS HAVE BEEN ISSUED IS AVAILABLE FROM THE
COMPANY UPON REQUEST. THIS WARRANT IS TRANSFERABLE ONLY AFTER COMPLIANCE
WITH THE PROVISIONS OF THE WARRANT AGREEMENT.
(b) Except as provided in Section 2.3(b), each Warrant Certificate
(and each certificate representing Warrant Shares issued upon exercise of
Warrants) shall bear the following legend (the "Private Placement Legend") on
the face thereof:
THE WARRANTS DESCRIBED HEREIN HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND MAY NOT BE
OFFERED OR SOLD EXCEPT (i) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT
UNDER THE SECURITIES ACT or (ii) UPON THE DELIVERY BY THE HOLDER TO THE
COMPANY OF AN OPINION OF COUNSEL, WHICH OPINION AND COUNSEL SHALL BE
REASONABLY SATISFACTORY TO THE COMPANY, STATING THAT AN EXEMPTION FROM
REGISTRATION UNDER THE SECURITIES ACT IS AVAILABLE.
SECTION 2.3. Transfer Provisions. (a) The Warrants may not be
offered or sold except (i) pursuant to an effective registration statement under
the Securities Act or (ii) upon the delivery by the Holder to the Company of an
opinion of counsel, which opinion and counsel shall be reasonably satisfactory
to the Company, stating that an exemption from registration under the Securities
Act is available. WARRANTS MAY NOT BE SOLD OR OTHERWISE TRANSFERRED TO ANY
PERSON OTHER THAN AN AFFILIATE OF THE HOLDER THEREOF.
(b) Private Placement Legend. Upon the transfer, exchange or
replacement of Warrants or Warrant Shares bearing the Private Placement Legend,
the Company shall deliver only Warrants or Warrant Shares, as applicable, that
bear the Private Placement Legend, unless such transfer or exchange (i) is
effected pursuant to an effective registration statement under the Securities
Act or (ii) in the case of Warrant Shares, such Warrant Shares were acquired
pursuant to an effective registration statement under the Securities Act or
(iii) there is delivered an opinion of counsel, which opinion and counsel shall
be reasonably satisfactory to the Company, to the effect that neither such
legend nor the related restrictions on transfer are required in order to
maintain compliance with the provisions of the Securities Act.
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(c) General. By its acceptance of any Warrant or Warrant Share
bearing the Private Placement Legend, each Holder or holder of a Warrant Share,
as applicable, acknowledges the restrictions on transfer of such Warrant or
Warrant Share, as applicable, set forth in this Agreement and in the Private
Placement Legend and agrees that it shall transfer such Warrant or Warrant
Share, as applicable, only as provided in this Agreement.
SECTION 2.4. Replacement Certificates. If a mutilated Warrant
Certificate is surrendered to the Company or if the Holder claims that the
Warrant Certificate has been lost, destroyed or wrongfully taken, the Company
shall issue a replacement Warrant Certificate. Such Holder shall furnish an
indemnity sufficient in the judgment of the Company to protect the Company from
any loss which it may suffer if a Warrant Certificate is replaced. Every
replacement Warrant Certificate is an additional obligation of the Company.
ARTICLE 3
Exercise Terms
SECTION 3.1. Exercise Price. Each Warrant shall initially entitle
the Holder thereof, subject to adjustment pursuant to the terms of this
Agreement, to purchase the number of shares of Common Stock set forth on the
face of the Warrant Certificate for a per share exercise price (the "Exercise
Price") of $10.00.
SECTION 3.2. Exercise Period; Restrictions on Exercise. Subject to
the terms and conditions set forth herein, the Warrants shall be exercisable at
any time; provided, however, that no Warrant shall be exercisable after the
fifth anniversary of the date of the Indemnification and Warrant Purchase
Agreement (the "Expiration Date").
SECTION 3.3. Expiration. Each Warrant shall terminate and become
void as of the earlier of (i) the close of business on the Expiration Date or
(ii) the date such Warrant is exercised. The Company shall give notice not less
than 90 and not more than 120 days prior to the Expiration Date to the Holders
of all then outstanding Warrants to the effect that the Warrants will terminate
and become void as of the close of business on the Expiration Date; provided,
however, that if the Company fails to give notice as provided in this Section
3.3, the Warrants will nevertheless expire and become void on the Expiration
Date.
SECTION 3.4. Manner of Exercise. Warrants may be exercised upon (i)
surrender to the Company of the related Warrant Certificate, together with the
form of election to purchase Common Stock on the reverse thereof duly filled in
and signed by the Holder thereof, and (ii) payment to the Company of the
Exercise Price for each
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Warrant Share issuable upon the exercise of such Warrants then exercised. Such
payment shall be made (i) in cash or by certified or official bank check payable
to the order of the Company or by wire transfer of funds to an account
designated by the Company for such purpose or (ii) without the payment of cash,
by reducing the number of shares of Common Stock obtainable upon the exercise of
a Warrant so as to yield a number of shares of Common Stock upon the exercise of
such Warrant equal to the product of (a) the number of shares of Common Stock
issuable as of the Exercise Date upon the exercise of such Warrant (if payment
of the Exercise Price were being made in cash) and (b) the Cashless Exercise
Ratio. An exercise of a Warrant in accordance with the immediately preceding
sentence is herein called a "Cashless Exercise". Upon surrender of a Warrant
Certificate representing more than one Warrant in connection with the holder's
option to elect a Cashless Exercise, the number of shares of Common Stock
deliverable upon a Cashless Exercise shall be equal to the number of shares of
Common Stock issuable upon the exercise of Warrants that the Holder specifies
are to be exercised pursuant to a Cashless Exercise multiplied by the Cashless
Exercise Ratio. All provisions of this Agreement shall be applicable with
respect to a surrender of a Warrant Certificate pursuant to a Cashless Exercise
for less than the full number of Warrants represented thereby. Subject to
Section 3.2, the rights represented by the Warrants shall be exercisable at the
election of the Holders thereof either in full or in part, and in the event that
a Warrant Certificate is surrendered for exercise of less than all the Warrants
represented by such Warrant Certificate at any time prior to the Expiration
Date, a new Warrant Certificate representing the remaining Warrants shall be
issued. The Company shall duly sign and deliver to the Holders the required new
Warrant Certificates.
SECTION 3.5. Issuance of Warrant Shares. Subject to Section 2.4,
upon the surrender of Warrant Certificates and payment of the per share Exercise
Price, as set forth in Section 3.4, the Company shall issue and cause the
transfer agent for the Common Stock (the "Transfer Agent") to countersign and
deliver to or upon the written order of the Holder and in such name or names as
the Holder may designate a certificate or certificates for the number of full
Warrant Shares so purchased upon the exercise of such Warrants or other
securities or property to which it is entitled, registered or otherwise, to the
Person or Persons entitled to receive the same, together with cash as provided
in Section 3.6 in respect of any fractional Warrant Shares otherwise issuable
upon such exercise. If the Warrant Shares and any cash to be delivered in lieu
of fractional Warrant Shares, or other securities or property to which a Holder
may be entitled, are to be delivered at such Holder's request to any Person
other than such Holder, as a condition to such delivery (i) the Warrant
Certificates so surrendered shall be properly endorsed or otherwise shall be in
proper form for transfer and (ii) the Holder shall pay to the Company any
transfer or other taxes required by reason of the delivery of such Warrant
Shares, cash, and/or other securities or property to a Person other than the
Holder, or shall establish to the satisfaction of the Company that any such
taxes have been paid or are not applicable. Such certificate or certificates
shall be deemed to have been issued and any Person so designated to be named
therein shall be deemed to have become a holder of record of such Warrant Shares
as of the date of the surrender of such Warrant Certificates and payment of the
per share Exercise Price, as aforesaid; provided, however, that if, at such
date, the transfer books for the Warrant Shares shall be closed,
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the certificates for the Warrant Shares in respect of which such Warrants are
then exercised shall be issuable as of the date on which such books shall next
be opened and until such date the Company shall be under no duty to deliver any
certificates for such Warrant Shares; provided further, however, that such
transfer books, unless otherwise required by law, shall not be closed at any one
time for a period longer than 20 calendar days. Each certificate representing
Warrant Shares shall bear the Private Placement Legend except as otherwise
provided in Section 2.3(b).
SECTION 3.6. Fractional Warrant Shares. The Company shall not be
required to issue fractional Warrant Shares on the exercise of Warrants. If more
than one Warrant shall be exercised in full at the same time by the same Holder,
the number of full Warrant Shares which shall be issuable upon such exercise
shall be computed on the basis of the aggregate number of Warrant Shares
purchasable pursuant thereto. If any fraction of a Warrant Share would, except
for the provisions of this Section 3.6, be issuable on the exercise of any
Warrant (or specified portion thereof), the Company shall pay at the time of
exercise an amount in cash equal to the Current Market Value per Warrant Share,
as determined on the day immediately preceding the date the Warrant is
exercised, multiplied by such fraction, computed to the nearest whole cent.
SECTION 3.7. Reservation of Warrant Shares. The Company shall at all
times until the Expiration Date keep reserved out of its authorized shares of
Common Stock a number of shares of Common Stock sufficient to provide for the
exercise of all outstanding Warrants. The Company will keep a copy of this
Agreement on file with any appointed Transfer Agent. All Warrant Shares which
may be issued upon exercise of Warrants shall, upon issue, be fully paid,
nonassessable, free of preemptive rights and free from all liens, charges and
security interests with respect to the issue thereof. The Company will supply
such Transfer Agent with duly executed stock certificates for such purpose and
will itself provide or otherwise make available any cash which may be payable as
provided in Section 3.6. The Company will furnish to such Transfer Agent a copy
of all notices of adjustments (and certificates related thereto) transmitted to
each Holder.
Before taking any action which would cause an adjustment pursuant to
Article 4 to reduce the Exercise Price below the then par value (if any) of the
Common Stock, the Company shall take any and all corporate action which may, in
the opinion of its counsel, be necessary in order that the Company may validly
and legally issue fully paid and nonassessable shares of Common Stock at the
Exercise Price as so adjusted.
The Company covenants that all shares of Common Stock which may be
issued upon exercise of Warrants will, upon issue, be fully paid, nonassessable,
free of preemptive rights, and free from all liens, charges and security
interests, created by or through the Company, with respect to the issue thereof.
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ARTICLE 4
Antidilution Provisions
SECTION 4.1. Changes in Common Stock. In the event that at any time
or from time to time after the date of execution of the Indemnification and
Warrant Purchase Agreement, the Company shall (i) pay a dividend or make a
distribution on its Common Stock payable in shares of its Common Stock or other
equity interests of the Company, (ii) subdivide its outstanding shares of Common
Stock into a larger number of shares of Common Stock, (iii) combine its
outstanding shares of Common Stock into a smaller number of shares of Common
Stock or (iv) increase or decrease the number of shares of Common Stock
outstanding by reclassification of its Common Stock, then the number of shares
of Common Stock issuable upon exercise of each Warrant immediately after the
happening of such event shall be adjusted to a number determined by multiplying
the number of shares of Common Stock that such Holder would have owned or have
been entitled to receive upon exercise had such Warrants been exercised
immediately prior to the happening of the events described above (or, in the
case of a dividend or distribution of Common Stock or other shares of capital
stock, immediately prior to the record date therefor) by a fraction, the
numerator of which shall be the total number of shares of Common Stock
outstanding immediately after the happening of the events described above and
the denominator of which shall be the total number of shares of Common Stock
outstanding immediately prior to the happening of the events described above;
and subject to Section 4.5, the Exercise Price for each Warrant shall be
adjusted to a number determined by dividing the Exercise Price immediately prior
to such event by the aforementioned fraction. An adjustment made pursuant to
this Section 4.1 shall become effective immediately after the effective date of
such event, retroactive to the record date therefor in the case of a dividend or
distribution in shares of Common Stock or other shares of the Company's capital
stock.
SECTION 4.2. Rights Issue to All Holders of Common Stock. In the
event that at any time or from time to time the Company shall issue to all
holders of Common Stock, without any charge, rights, options or warrants
entitling the holders thereof to subscribe for shares of Common Stock, or
securities convertible into or exchangeable or exercisable for Common Stock,
entitling such holders to subscribe for or purchase shares of Common Stock other
than in connection with the adoption of a shareholder rights plan by the
Company, then the Holders shall have the right to participate along with and to
the same extent as the holders of Common Stock, pro rata as if the Warrants were
exercised in full immediately prior to such issuance.
SECTION 4.3. Combination; Liquidation. (a) Except as provided in
Section 4.3(b), in the event of a Combination, each Holder shall have the right
to receive upon exercise of the Warrants the kind and amount of shares of
capital stock or other securities or property which such Holder would have been
entitled to receive upon or as a result of such Combination had such Warrant
been exercised
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immediately prior to such event. Unless paragraph (b) is applicable to a
Combination, the Company shall provide that the surviving or acquiring Person
(the "Successor Company") in such Combination will confirm the Holders' rights
pursuant to this Section 4.3(a) and provide for adjustments, which shall be as
nearly equivalent as may be practicable to the adjustments provided for in this
Article 4. The provisions of this Section 4.3(a) shall similarly apply to
successive Combinations involving any Successor Company.
(b) In the event of (i) a Combination where consideration to the
holders of Common Stock in exchange for their shares is payable solely in cash
or (ii) the dissolution, liquidation or winding-up of the Company, Holders shall
be entitled to receive, upon surrender of their Warrant Certificates,
distributions on an equal basis with the holders of Common Stock or other
securities, issuable upon exercise of the Warrants, as if the Warrants had been
exercised immediately prior to such event, less the Exercise Price. In case of
any Combination described in this Section 4.3(b), the surviving or acquiring
Person and, in the event of any dissolution, liquidation or winding up of the
Company, the Company, shall deposit promptly with the Transfer Agent (or such
other agent acting in the place of the Transfer Agent for such dissolution,
liquidation or winding up of the Corporation (the "Combination Agent") the
funds, if any, necessary to pay to the Holders the amounts to which they are
entitled as described above. After such funds and the surrendered Warrant
Certificates are received, the Transfer Agent (or Combination Agent, as
appropriate) shall deliver a check in such amount as is appropriate (or, in the
case of consideration other than cash, such other consideration as is
appropriate) to such Person or Persons as it may be directed in writing by the
surrendering Holders.
(c) In the event of a combination pursuant to which Holders become
entitled to receive, upon exercise of the Warrants, capital stock, other
securities, property, cash or other distributions pursuant to Sections 4.3(a) or
4.3(b), Holders shall not thereafter be entitled to receive Common Stock upon
the exercise of the Warrants.
SECTION 4.4. Other Events. If any event occurs as to which the
foregoing provisions of this Article 4 are not strictly applicable or, if
strictly applicable, would not, in the good faith judgment of the Board, fairly
and adequately protect the purchase rights of the Warrants in accordance with
the essential intent and principles of such provisions, then the Board shall
make such adjustments in the application of such provisions, in accordance with
such essential intent and principles, as shall be reasonably necessary, in the
good faith opinion of the Board, to protect such purchase rights as aforesaid,
but in no event shall any such adjustment have the effect of increasing the
Exercise Price or decreasing the number of shares of Common Stock issuable upon
exercise of any Warrant.
SECTION 4.5. Minimum Adjustment. The adjustments required by the
preceding Sections of this Article 4 shall be made whenever and as often as any
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specified event requiring an adjustment shall occur, except that no adjustment
of the Exercise Price or the number of shares of Common Stock issuable upon
exercise of Warrants that would otherwise be required shall be made unless and
until such adjustment, either by itself or with other adjustments not previously
made, increases or decreases by at least 1% the Exercise Price or the number of
shares of Common Stock issuable upon exercise of Warrants immediately prior to
the making of such adjustment. Any adjustment representing a change of less than
such minimum amount shall be carried forward and made as soon as such
adjustment, together with other adjustments required by this Article 4 and not
previously made, would result in a minimum adjustment. For the purpose of any
adjustment, any specified event shall be deemed to have occurred at the close of
business on the date of its occurrence. In computing adjustments under this
Article 4, fractional interests in Common Stock shall be taken into account to
the nearest one-hundredth of a share.
SECTION 4.6. Notice of Adjustment. Whenever the Exercise Price or
the number of shares of Common Stock and other property, if any, issuable upon
exercise of the Warrants is adjusted, as herein provided, the Company shall
deliver to each Holder a certificate setting forth, in reasonable detail, the
event requiring the adjustment and the method by which such adjustment was
calculated and specifying the Exercise Price and the number of shares of Common
Stock issuable upon exercise of Warrants after giving effect to such adjustment.
SECTION 4.7. Notice of Certain Transactions. In the event that the
Company shall propose to (a) pay any dividend payable in securities of any class
to the holders of its Common Stock or to make any other non-cash dividend or
distribution to the holders of its Common Stock, (b) offer the holders of its
Common Stock rights to subscribe for or to purchase any securities convertible
into shares of Common Stock or shares of stock of any class or any other
securities, rights or options, (c) issue any (i) shares of Common Stock, (ii)
rights, options or warrants entitling the holders thereof to subscribe for
shares of Common Stock, or (iii) securities convertible into or exchangeable or
exercisable for Common Stock (in the case of (i), only if such issuance or
adjustment would result in an adjustment hereunder), (d) effect any capital
reorganization, reclassification, consolidation or merger, (e) effect the
voluntary or involuntary dissolution, liquidation or winding-up of the Company
or (f) make a tender offer or exchange offer with respect to the Common Stock,
the Company shall send to each Holder a notice of such proposed action or offer.
Such notice shall specify the record date for the purposes of such dividend,
distribution or right, or the date such issuance or event is to take place and
the date of participation therein by the holders of Common Stock, if any such
date is to be fixed, and shall briefly indicate the effect of such action on the
Common Stock and on the number and kind of any other shares of stock and on
other property, if any, and the number of shares of Common Stock and other
property, if any, issuable upon exercise of each Warrant and the Exercise Price
after giving effect to any adjustment pursuant to Article 4 which will be
required as a result of such action. Such notice shall be given as promptly as
possible and (x) in the case of any action covered by clause (a) or (b) above,
at least 10 days prior to the record date for
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determining holders of the Common Stock for purposes of such action or (y) in
the case of any other such action, at least 20 days prior to the date of the
taking of such proposed action or the date of participation therein by the
holders of Common Stock, whichever shall be the earlier.
SECTION 4.8. Adjustment to Warrant Certificate. The form of Warrant
Certificate need not be changed because of any adjustment made pursuant to this
Article 4, and Warrant Certificates issued after such adjustment may state the
same Exercise Price and the same number of shares of Common Stock issuable upon
exercise of the Warrants as are stated in the Warrant Certificates initially
issued pursuant to this Agreement. The Company, however, may at any time in its
sole discretion make any change in the form of Warrant Certificate that it may
deem appropriate to give effect to such adjustment and that does not affect the
substance of the Warrant Certificate, and any Warrant Certificate thereafter
issued or countersigned, whether in exchange or substitution for an outstanding
Warrant Certificate or otherwise, may be in the form as so changed.
ARTICLE 5
Registration Rights
SECTION 5.1. Effectiveness of Registration Statement. Subject to
Section 5.2, upon the purchase of at least 500,000 Warrants pursuant to the
Indemnification and Warrant Purchase Agreement, the Company shall cause to be
filed pursuant to Rule 415 (or any successor provision) of the Securities Act a
shelf registration statement covering resales of Warrant Shares by the holders
thereof (the "Warrant Shares Registration Statement") and shall use its
reasonable best efforts to cause the Warrant Shares Registration Statement to be
declared effective as soon as practicable thereafter. Subject to Section 5.2,
the Company shall cause the Warrant Shares Registration Statement to remain
effective until the earlier of (i) the second anniversary of the date on which
the last Warrant has been exercised at a time when the Warrant Shares
Registration Statement was not effective or when the use of the prospectus
contained therein was suspended and (ii) the date when all the Warrant Shares
have been sold pursuant to the Warrant Shares Registration Statement. In
connection with the Warrant Shares Registration Statement, (i) the Company shall
furnish to each Holder, without charge, at least one copy of the Warrant Shares
Registration Statement and any post-effective amendment thereto, including
financial statements and schedules, and, if the Holder so requests in writing,
all exhibits thereto (including those incorporated by reference), (ii) the
Company shall, for so long as the Warrant Shares Registration Statement is
effective, deliver to each Holder, without charge, as many copies of the
prospectus (including each preliminary prospectus) included in the Warrant
Shares Registration Statement and any amendment or supplement thereto as such
Holder may reasonably request, and the Company consents to the proper use of the
prospectus therein and any amendment or supplement thereto by each of the
selling Holders in connection
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with the offering and sale of the Warrant Shares covered by such prospectus and
any amendment or supplement thereto, (iii) the Company may require each Holder
of Warrants to be exercised in connection with the Warrant Shares Registration
Statement to furnish to the Company such information regarding the Holder and
the distribution of such Warrant Shares as the Company may from time to time
reasonably request for inclusion in the Warrant Shares Registration Statement
and (iv) the Company shall enter into such agreements (including underwriting
agreements) as are appropriate, customary and reasonably necessary in connection
with the Warrant Shares Registration Statement.
SECTION 5.2. Suspension. During any consecutive 365-day period, the
Company shall be entitled to suspend the availability of the Warrant Shares
Registration Statement for up to two 45 consecutive-day periods (except that the
Company may not suspend such availability during the 45 consecutive-day period
immediately prior to the Expiration Date) if the Board determines in the
exercise of its reasonable judgment that there is a valid business purpose for
such suspension and provides notice that such determination was made by the
Company's Board to Holders.
SECTION 5.3. Blue Sky. Upon the filing of the Warrant Shares
Registration Statement, the Company shall use its reasonable best efforts to
register or qualify the resale of the Warrant Shares under all applicable
securities laws, blue sky laws or similar laws of all jurisdictions in the
United States in which any Holder may or may be deemed to resell Warrant Shares
and shall use its reasonable best efforts to maintain such registration or
qualification through the period of time during which the Warrant Shares
Registration Statement remains effective; provided, however, that the Company
shall not be required to qualify generally to do business in any jurisdiction
where it would not otherwise be required to qualify but for this Section 5.3 or
to take any action which would subject it to general service of process or to
taxation in any such jurisdiction where it is not then so subject.
SECTION 5.4. Accuracy of Disclosure. The Company represents and
warrants to each Holder and agrees for the benefit of each Holder that (i) the
Warrant Shares Registration Statement and any amendment thereto will not contain
any untrue statement of material fact or omit to state a material fact required
to be stated therein or necessary to make the statements contained therein not
misleading; and (ii) no prospectus furnished to such Holder for delivery in
connection with the sale of Warrant Shares or the documents incorporated by
reference therein, will contain any untrue statement of material fact or omit to
state a material fact required to be stated therein or necessary to make the
statements contained therein, in light of the circumstances under which they
were made, not misleading; provided, however, that the Company shall have no
liability under clause (i) or (ii) of this Section 5.4 with respect to any such
untrue statement or omission in the Warrant Shares Registration Statement made
in reliance upon and in conformity with information furnished to the Company by
or on behalf of the Holders specifically for inclusion therein.
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SECTION 5.5. Indemnification. (a) In connection with the Warrant
Shares Registration Statement, the Company agrees to indemnify and hold harmless
each Holder and/or holder of Warrant Shares and each Person, if any, who
controls such Holder within the meaning of the Securities Act or the Exchange
Act (each Holder and such controlling Persons being referred to collectively as
the "Holder Indemnified Parties") from and against any losses, damages or
liabilities, joint or several, or any actions in respect thereof (including but
not limited to any losses, claims, damages, liabilities or actions relating to
purchases and sales of the Warrant Shares) to which each Holder Indemnified
Party may become subject under the Securities Act, the Exchange Act or
otherwise, insofar as such losses, claims, damages, liabilities or actions arise
out of or are based upon any untrue statement or alleged untrue statement of a
material fact contained in the Warrant Shares Registration Statement or its
related prospectus or in any amendment or supplement thereto, or arise out of,
or are based upon, the omission or alleged omission of a material fact required
to be stated therein or necessary to make the statements therein, in light of
the circumstances under which they were made, not misleading, and shall
reimburse, as incurred, the Holder Indemnified Parties for any legal or other
expenses reasonably incurred by them in connection with investigating or
defending any such loss, claim, damage, liability or action in respect thereof;
provided, however, that (i) the Company shall not be liable in any such case to
the extent that such loss, claim, damage or liability arises out of or is based
upon any untrue statement or alleged untrue statement or omission or alleged
omission made in the Warrant Shares Registration Statement or any preliminary or
final prospectus or in any amendment or supplement thereto in reliance upon and
in conformity with written information pertaining to such Holder and furnished
to the Company by or on behalf of such Holder specifically for inclusion
therein; (ii) with respect to any untrue statement or omission or alleged untrue
statement or omission made in any prospectus relating to the Warrant Shares
Registration Statement, the indemnity agreement contained in this subsection (a)
shall not inure to the benefit of any Person to whom there is a prospectus
delivery requirement (a "Delivering Seller") that sold the Warrant Shares to the
Person asserting any such losses, claims, damages or liabilities to the extent
that any such loss, claim, damage or liability of such Delivering Seller results
from the failure to send or give to such Person, on or prior to the written
confirmation of such sale, a copy of the relevant prospectus, as amended and
supplemented, provided that (I) the Company shall have previously furnished
copies thereof to such Delivering Seller in accordance with this Agreement and
(II) such furnished prospectus, as amended and supplemented, would have
corrected any such untrue statement or omission or alleged untrue statement or
omission; and (iii) this indemnity agreement will be in addition to any
liability which the Company may otherwise have to such Holder Indemnified Party.
(b) In connection with the Warrant Shares Registration Statement,
the Holders agree to indemnify and hold harmless the Company and each Person, if
any, who controls the Company within the meaning of the Securities Act or the
Exchange Act (the Company and such controlling Persons being referred to
collectively as the "Company Indemnified Parties") from and against any losses,
damages or liabilities, joint or several, or any actions in respect thereof
(including but not limited to any losses, claims, damages, liabilities or
actions relating to purchases and sales of the Warrant Shares) to
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which each Company Indemnified Party may become subject under the Securities
Act, the Exchange Act or otherwise, insofar as such losses, claims, damages,
liabilities or actions arise out of or are based upon any untrue statement or
alleged untrue statement of a material fact contained in the Warrant Shares
Registration Statement or its related prospectus or in any amendment or
supplement thereto, or arise out of, or are based upon, the omission or alleged
omission of a material fact required therein or necessary to make the statements
therein, in light of the circumstances under which they were made, not
misleading, and shall reimburse, as incurred, the Company Indemnified Parties
for any legal or other expenses reasonably incurred by them in connection with
investigating or defending any such loss, claim, damage, liability or action in
respect thereof; provided, however, that such Holder shall not be liable in any
such case to the extent that such loss, claim, damage or liability arises out of
or is based upon any untrue statement or alleged untrue statement or omission or
alleged omission made in the Warrant Shares Registration Statement or any
preliminary or final prospectus or in any amendment or supplement thereto in
reliance upon and in conformity with written information pertaining to such
Holder and furnished to such Holder by or on behalf of the Company specifically
for inclusion therein.
(c) Promptly after receipt by an indemnified party under this
Section 5.5 of notice of any claim or the commencement of any action, the
indemnified party shall, if a claim in respect thereof is to be made against the
indemnifying party under this Section 5.5, notify the indemnifying party in
writing of the claim or the commencement of the action; provided, however, that
the failure to notify the indemnifying party shall not relieve it from any
liability which it may have under this Section 5.5 except to the extent it has
been materially prejudiced by such failure and, provided further, that the
failure to notify the indemnifying party shall not relieve it from any liability
which it may have to an indemnified party otherwise than under Section 5.5(a) or
5.5(b) herein. If any such claim or action shall be brought against an
indemnified party, and it shall have notified the indemnifying party thereof,
the indemnifying party shall be entitled to participate therein and, to the
extent that it wishes, jointly with any other similarly notified indemnifying
party, to assume the defense thereof with counsel reasonably satisfactory to the
indemnified party. After notice from the indemnifying party to the indemnified
party of its election to assume the defense of such claim or action, the
indemnifying party shall not be liable to the indemnified party under this
Section 5.5 for any legal or other expenses subsequently incurred by the
indemnified party in connection with the defense thereof other than reasonable
costs of investigation; provided, however, that the indemnified party shall have
the right to employ counsel to represent jointly the indemnified party and those
other Holders and their respective officers, employees and controlling Persons
who may be subject to liability arising out of any claim in respect of which
indemnity may be sought by an indemnified party against the indemnifying party
under this Section 5.5 if, in the reasonable judgment of the indemnified party
it is advisable for the indemnified party and those Holders, officers, employees
and controlling Persons to be jointly represented by separate counsel, and in
that event the fees and expenses of such separate counsel shall be paid by the
indemnifying party. In no event shall the indemnifying parties be liable for the
fees and expenses of more than one counsel (in addition to local counsel) for
all indemnified parties in connection with any
14
<PAGE>
proceeding or related proceedings. Each indemnified party, as a condition of the
indemnity agreements contained in Section 5.5(a) and 5.5(b) hereof, shall use
its best efforts to cooperate with the indemnifying party in the defense of any
such action or claim. No indemnifying party shall (i) without the prior written
consent of the indemnified parties (which consent shall not be unreasonably
withheld), settle or compromise or consent to the entry of any judgment with
respect to any pending or threatened claim, action, suit or proceeding in
respect of which indemnification or contribution may be sought hereunder
(whether or not the indemnified parties are actual or potential parties to such
claim or action) unless such settlement, compromise or consent includes an
unconditional release of each indemnified party from all liability arising out
of such claim, action, suit or proceeding, or (ii) be liable for any settlement
of any such action effected without its written consent (which consent shall not
be unreasonably withheld or delayed), but if settled with its written consent or
if there is a final judgment for the plaintiff in any such action, the
indemnifying party agrees to indemnify and hold harmless any indemnified party
from and against any loss or liability by reason of such settlement or judgment.
(d) If the indemnification provided for in this Section 5.5 shall
for any reason be unavailable to or insufficient to hold harmless an indemnified
party under Section 5.5(a) or 5.5(b) in respect of any loss, claim, damage or
liability, or any action in respect thereof, referred to therein, then each
indemnifying party shall, in lieu of indemnifying such indemnified party,
contribute to the amount paid or payable by such indemnified party as a result
of such loss, claim, damage or liability, or action in respect thereof, in such
proportion as shall be appropriate to reflect the relative fault of the Company
on the one hand and the Holders on the other with respect to the statements or
omissions which resulted in such loss, claim, damage or liability, or action in
respect thereof, as well as any other relevant equitable considerations. The
relative fault shall be determined by reference to, among other things, whether
the untrue or alleged untrue statement of a material fact or omission or alleged
omission to state a material fact relates to information supplied by the Company
or the Holders, the intent of the parties and their relative knowledge, access
to information and opportunity to correct or prevent such statement or omission.
The Company and the Holders agree that it would not be just and equitable if
contributions pursuant to this Section 5.5(d) were to be determined by pro rata
allocation (even if the Holders were treated as one entity for such purpose) or
by any other method of allocation which does not take into account the equitable
considerations referred to herein. The amount paid or payable by an indemnified
party as a result of the loss, claim, damage or liability, or action in respect
thereof, referred to above in this Section 5.5(d) shall be deemed to include,
subject to limitations set forth above, for purposes of this Section 5.5(d), any
legal or other expenses reasonably incurred by such indemnified party in
connection with investigating or defending any such action or claim.
Notwithstanding the provisions of this Section 5.5(d), no Holder shall be
required to indemnify or contribute any amount in excess of the amount by which
proceeds received by such Holder from an offering of the Warrant Shares exceeds
the amount of any damages which such Holder has otherwise paid or become liable
to pay by reason of any untrue or alleged untrue statement or omission or
alleged omission. No Person guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the Securities Act)
15
<PAGE>
shall be entitled to contribution from any Person who was not guilty of such
fraudulent misrepresentation. The Holders' obligations to contribute as provided
in this Section 5.5(d) are several and not joint. The remedies provided for in
this Section 5.5 are not exclusive and shall not limit any rights or remedies
which may otherwise be available to any indemnified party at law or in equity.
(e) The agreements contained in this section shall survive the
exercise of the Warrant Shares, and shall remain in full force and effect,
regardless of any termination or cancellation of this Agreement or any
investigation made by or on behalf of any indemnified party.
SECTION 5.6. Additional Acts. If the issuance or sale of any Common
Stock or other securities issuable upon the exercise of the Warrants requires
registration or approval of any governmental authority (other than the
registration requirements under the Securities Act), or the taking of any other
action under the laws of the United States of America or any political
subdivision thereof before such securities may be validly offered or sold in
compliance with such laws, then the Company covenants that it will, in good
faith and as expeditiously as reasonably possible, use all reasonable efforts to
secure and maintain such registration or approval or to take such other action,
as the case may be.
SECTION 5.7. Expenses. All expenses (other than any underwriting
discounts or commissions) incident to the Company's performance of or compliance
with its obligations under this Article 5 will be borne by the Company,
including, without limitation: (i) all Commission, stock exchange or National
Association of Securities Dealers, Inc. registration and filing fees, (ii) all
fees and expenses incurred in connection with compliance with state securities
or blue sky laws, (iii) all expenses of any Persons incurred by or on behalf of
the Company in preparing or assisting in preparing, printing and distributing
the Warrant Shares Registration Statement or any other registration statement,
prospectus, any amendments or supplements thereto and other documents relating
to the performance of and compliance with this Article 5, (iv) the fees and
disbursements of counsel for the Company, and (v) the fees and disbursements of
the independent public accountants of the Company, including the expenses of any
special audits or comfort letters required by or incident to such performance
and compliance.
16
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ARTICLE 6
Miscellaneous
SECTION 6.1. Reports of the Company. The Company agrees to provide
to each Holder, without cost to such Holder, copies of the annual reports that
the Company files with the Commission (to the extent such filings are accepted
by the Commission) and any other documents that the Company mails to holders of
Common Stock within 15 days after the date such reports or other documents are
mailed to holders of Common Stock.
SECTION 6.2. Rights of Holders. Holders of unexercised Warrants are
not entitled to (i) receive dividends or other distributions, (ii) receive
notice of or vote at any meeting of the stockholders, (iii) consent to any
action of the stockholders, (iv) receive notice as stockholders of any other
proceedings of the Company, (v) exercise any preemptive rights or (vi) exercise
any other rights whatsoever as stockholders of the Company.
SECTION 6.3. Amendment. This Agreement may be amended by the parties
hereto without the consent of any Holder for the purpose of curing any
ambiguity, or of curing, correcting or supplementing any defective provision
contained herein or adding or changing any other provisions with respect to
matters or questions arising under this Agreement as the Company may deem
necessary or desirable (including, without limitation, any addition or
modification to provide for compliance with the transfer restrictions set forth
herein); provided, however, that such action shall not adversely affect the
rights of any of the Holders. Any amendment or supplement to this Agreement that
has an adverse effect on the interests of the Holders shall require the written
consent of the Holders of a majority of the then outstanding Warrants. The
consent of each Holder affected shall be required for any amendment pursuant to
which the Exercise Price would be increased or the number of Warrant Shares
issuable upon exercise of Warrants would be decreased (other than pursuant to
adjustments provided herein) or the exercise period with respect to the Warrants
would be shortened. In determining whether the Holders of the required number of
Warrants have concurred in any direction, waiver or consent, Warrants owned by
the Company or by any Person directly or indirectly controlling or controlled by
or under direct or indirect common control with the Company shall be disregarded
and deemed not to be outstanding. Also, subject to the foregoing, only Warrants
outstanding at the time shall be considered in any such determination.
17
<PAGE>
SECTION 6.4. Notices. Any notice or communication shall be in
writing and delivered in Person or mailed by first-class mail addressed as
follows:
if to the Company:
Chart Industries, Inc.
5885 Landerbrook Drive
Suite 150
Mayfield Heights, OH 44114-2688
Attention: Chief Financial Officer
with a copy to:
Calfee, Halter & Griswold LLP
1400 McDonald Investment Center
800 Superior Avenue
Cleveland, Ohio 44114-2688
Attention: Thomas F. McKee
Any notice or communication mailed to a Holder shall be mailed to
the Holder at the Holder's address as it appears on Exhibit B hereto or such
other address as such Holder shall notify the Company in writing.
Failure to mail a notice or communication to a Holder or any defect
in it shall not affect its sufficiency with respect to other Holders. If a
notice or communication is mailed in the manner provided above, it is duly
given, whether or not the addressee receives it.
SECTION 6.5. Governing Law. The laws of the State of Delaware shall
govern this Agreement and the Warrants.
SECTION 6.6. Successors. All agreements of the Company in this
Agreement and the Warrant Certificates shall bind its successors.
SECTION 6.7. Multiple Originals. The parties may sign any number of
copies of this Agreement. Each signed copy shall be an original, but all of them
together represent the same agreement. One signed copy is enough to prove this
Agreement.
SECTION 6.8. Table of Contents. The table of contents and headings
of the Articles and Sections of this Agreement have been inserted for
convenience of
18
<PAGE>
reference only, are not a part this Agreement and shall not modify or restrict
any of the terms or provisions hereof.
SECTION 6.9. Severability. The provisions of this Agreement are
severable, and if any clause or provision shall be held invalid, illegal or
unenforceable in whole or in part in any jurisdiction, then such invalidity or
unenforceability shall affect in that jurisdiction only such clause or
provision, or part thereof, and shall not in any manner affect such clause or
provision in any other jurisdiction or any other clause or provision of this
Agreement in any jurisdiction.
19
<PAGE>
IN WITNESS WHEREOF, the parties have caused this Agreement to be
duly executed as of the date first written above.
CHART INDUSTRIES, INC.
BY: /s/ Arthur S. Holmes
-----------------------------------
Arthur S. Holmes
Chairman and Chief Executive Officer
THE MEMBERS:
ACI CAPITAL I, LLC
BY: /s/ Kevin S. Penn
------------------------------
Name: Kevin S. Penn
Title: President
AMERICAN SECURITIES PARTNERS, L.P.
By: American Securities Associates, L.P.,
its general partner
By: American Securities Partners GP
(Management) Corp.
BY: Authorized Representative
-----------------------------
Name:
Title:
MVE CRYOGENICS LLC
BY: Authorized Representative
------------------------------
Name:
Title:
20
<PAGE>
CRM/MVE CAPITAL LLC
By: Cramer Rosenthal McGlynn, Inc.,
as Manager
BY: /s/ Eugene Trainor
--------------------------
Name: Eugene Trainor
Title: EVP, COO
TANGENT LLC
BY: Authorized Representative
------------------------------
Name:
Title:
FERTOSA LLC
BY: Authorized Representative
------------------------------
Name:
Title:
BURDEN DIRECT INVESTMENT FUND II
By: William A.M. Burden & Co., L.P.,
its general partner
By: Burden Brothers, Inc.,
its sole general partner
BY: /s/ Jeffrey A. Weber
-----------------------------
Name: Jeffrey A. Weber
Title: President and CEO
21
<PAGE>
EXHIBIT A
FORM OF FACE OF WARRANT CERTIFICATE
THIS WARRANT ENTITLES THE HOLDER TO PURCHASE ______ SHARES OF COMMON
STOCK OF THE COMPANY AT A PURCHASE PRICE OF $10.00 PER SHARE, SUBJECT TO
ADJUSTMENT UNDER CERTAIN CIRCUMSTANCES. A COPY OF THE WARRANT AGREEMENT PURSUANT
TO WHICH THE WARRANTS HAVE BEEN ISSUED IS AVAILABLE FROM THE COMPANY UPON
REQUEST. THIS WARRANT IS TRANSFERABLE ONLY AFTER COMPLIANCE WITH THE PROVISIONS
OF THE WARRANT AGREEMENT
THE WARRANTS DESCRIBED HEREIN HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND MAY NOT BE
OFFERED OR SOLD EXCEPT (i) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OR (ii) UPON THE DELIVERY BY THE HOLDER TO THE COMPANY OF AN
OPINION OF COUNSEL, WHICH OPINION AND COUNSEL SHALL BE REASONABLY SATISFACTORY
TO THE COMPANY, STATING THAT AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES
ACT IS AVAILABLE.
22
<PAGE>
No. Certificate for _____ Warrants
WARRANTS TO PURCHASE COMMON STOCK OF
CHART INDUSTRIES, INC.
THIS CERTIFIES THAT __________, or his (or its) registered assigns,
is the registered holder of the number of Warrants set forth above (the
"Warrants"). Each Warrant entitles the holder thereof (the "Holder"), at his (or
its) option and subject to the provisions contained herein and in the Agreement
referred to below, to purchase from Chart Industries, Inc., a Delaware
corporation ("the Company"), ________ shares of common stock, par value $0.01
per share, of the Company (the "Common Stock") at the per share exercise price
of $10.00 (the "Exercise Price"), or by Cashless Exercise referred to below.
This Warrant Certificate shall terminate and become void as of the close of
business on April 12, 2004 (the "Expiration Date") or upon the exercise hereof
as to all the shares of Common Stock subject hereto. The number of shares of
Common Stock issuable upon exercise of the Warrants and the Exercise Price per
share shall be subject to adjustment from time to time as set forth in the
Agreement.
This Warrant Certificate is issued under and in accordance with the
Warrant Agreement dated as of April 12, 2004 (the "Agreement"), between the
Company and the Holder hereof, and is subject to the terms and provisions
contained in the Agreement. Reference is hereby made to the Agreement for a full
statement of the respective rights, limitations of rights, duties and
obligations of the Company and the Holders. Capitalized terms used but not
defined herein shall have the meanings ascribed to them in the Agreement. A copy
of the Agreement may be obtained for inspection by the Holder hereof upon
written request to the Company at Chart Industries, Inc., 5885 Landerbrook
Drive, Suite 150, Mayfield Heights, Ohio 44124.
Subject to the terms of the Agreement, the Warrants may be exercised
in whole or in part (i) by presentation of this Warrant Certificate with the
Election to Purchase attached hereto duly executed and with the simultaneous
payment of the Exercise Price in cash to the Company or (ii) by Cashless
Exercise. Payment of the Exercise Price in cash shall be made by certified or
official bank check payable to the order of the Company or by wire transfer of
funds to an account designated by the Company for such purpose. Payment by
Cashless Exercise shall be made without the payment of cash by reducing the
amount of Common Stock that would be obtainable upon the exercise of a Warrant
and payment of the Exercise Price in cash so as to yield a number of shares of
Common Stock upon the exercise of such Warrant equal to the product of (1) the
number of shares of Common Stock for which such Warrant is exercisable as of the
Exercise Date (if the Exercise Price were paid in cash) and (2) a fraction, the
numerator of which is the excess of the Current Market Value per share of Common
Stock on the Exercise Date over the Exercise Price per share of Common Stock as
of the Exercise Date and the denominator of which is the Current Market Value
per share of the Common Stock on the Exercise Date.
23
<PAGE>
This Warrant requires the Holder to comply with certain
certification and opinion delivery requirements under certain circumstances to
validly exercise the Warrant.
As provided in the Agreement and subject to the terms and conditions
therein set forth, the Warrants shall be exercisable at any time, provided,
however, that no Warrant shall be exercisable after April 12, 2004. This Warrant
is entitled to the benefit of certain registration rights contained in the
Agreement.
In the event the Company enters into a Combination, the Holder
hereof will be entitled to receive upon exercise of the Warrants only the kind
and amount of shares of capital stock or other securities or other property of
such surviving entity as the Holder would have been entitled to receive upon or
as a result of the Combination had the Holder exercised its Warrants immediately
prior to such Combination; provided, however, that in the event that, in
connection with such Combination, consideration to holders of Common Stock in
exchange for their shares is payable solely in cash or in the event of the
dissolution, liquidation or winding-up of the Company, the Holder hereof will be
entitled to receive only such cash distributions as the Holder would have
received had the Holder exercised its Warrants immediately prior to such
Combination, less the Exercise Price.
As provided in the Agreement, the number of shares of Common Stock
issuable upon the exercise of the Warrants and the Exercise Price are subject to
adjustment upon the happening of certain events.
The Company may require payment of a sum sufficient to pay all
taxes, assessments or other governmental charges in connection with the transfer
or exchange of the Warrant Certificates pursuant to Section 2.3 of the
Agreement, but not for any exchange or original issuance (not involving a
transfer) with respect to temporary Warrant Certificates, the exercise of the
Warrants or the issuance of the Warrant Shares.
Upon any partial exercise of the Warrants, there shall be signed and
issued to the Holder hereof a new Warrant Certificate representing those
Warrants which were not exercised. This Warrant Certificate may be exchanged at
the office of the Company by mailing or presenting this Warrant Certificate,
properly endorsed and with a request to exchange this Warrant Certificate for
other Warrant Certificates evidencing an equal number of Warrants. No fractional
Warrant Shares will be issued upon the exercise of the Warrants, but the Company
shall pay an amount in cash equal to the Current Market Value per Warrant Share
on the day immediately preceding the date the Warrant is exercised, multiplied
by the fraction of a Warrant Share that would be issuable on the exercise of any
Warrant.
All shares of Common Stock issuable by the Company upon the exercise
of the Warrants shall, upon such issue, be duly and validly issued and fully
paid and non-assessable.
24
<PAGE>
The holder in whose name the Warrant Certificate is registered may
be deemed and treated by the Company as the absolute owner of the Warrant
Certificate for all purposes whatsoever and the Company shall not be affected by
notice to the contrary.
The Warrants do not entitle any holder hereof to any of the rights
of a shareholder of the Company.
This Warrant shall be governed by the laws of the State of Delaware.
This Warrant Certificate shall not be valid or obligatory for any
purpose until it shall have been signed by the Company.
CHART INDUSTRIES, INC.
By:____________________________________
Arthur S. Holmes
Chairman and Chief Executive Officer
DATED: April 12, 1999
25
<PAGE>
FORM OF ELECTION TO PURCHASE WARRANT SHARES
(to be executed only upon exercise of Warrants)
CHART INDUSTRIES, INC.
The undersigned hereby irrevocably elects to exercise Warrants at an
exercise price per Warrant (subject to adjustment) of $10.00 and acquire _____
shares of Common Stock, par value $0.01 per share, of Chart Industries, Inc. on
the terms and conditions specified within the Warrant Certificate and the
Agreement therein referred to, surrenders this Warrant Certificate and all
right, title and interest therein to Chart Industries, Inc. and directs that the
shares of Common Stock deliverable upon the exercise of such Warrants be
registered or placed in the name and at the address specified below and
delivered thereto.
Date:____________, ____
(Signature of Owner)
(Street Address)
(City) (State) (Zip Code)
Signature Guaranteed by:
Signature must be guaranteed by an
eligible Guarantor Institution (banks,
stock brokers, savings and loan
associations and credit unions) with
membership in an approved guarantee
medallion program pursuant to Securities
and Exchange Commission Rule 17Ad-5
The signature must correspond with the name as written upon the face of
the Warrant Certificate in every particular, without alteration or
enlargement or any change whatsoever, and must be guaranteed.
Securities and/or checks should be issued to:
Please insert social security or identifying number:
26
<PAGE>
Name:_____________________________________________________________________
Street Address:___________________________________________________________
City, State and Zip Code:_________________________________________________
Any unexercised Warrants represented by the Warrant Certificate should be issued
to:
Please insert social security or identifying number:
Name:_____________________________________________________________________
Street Address:___________________________________________________________
City, State and Zip Code:_________________________________________________
27
<PAGE>
FORM OF TRANSFER NOTICE
FOR VALUE RECEIVED the undersigned registered holder hereby sell(s),
assign(s) and transfer(s) unto
Insert Taxpayer Identification No.
(Please print or type name and address including zip code of assignee)
the within Warrant and all rights thereunder, hereby irrevocably constituting
and appointing _________________________ attorney to transfer such Warrant on
the books of the Company with full power of substitution in the premises.
In connection with any transfer of this Warrant occurring prior to
the date which is the earlier of the date of an effective Registration Statement
or the end of the period referred to in Rule 144(k) under the Securities Act,
the undersigned confirms that without utilizing any general solicitation or
general advertising that this Warrant is being transferred and documents are
being furnished which comply with the conditions of transfer set forth in this
Warrant and the Agreement.
Date:____________________________ ________________________
NOTICE: The signature to this assignment
must correspond with the name as written
upon the face of the Warrant in every
particular, without alteration or any
change whatsoever.
28
<PAGE>
EXECUTION COPY
ESCROW AGREEMENT
THIS ESCROW AGREEMENT (this "Escrow Agreement"), dated as of April 12,
1999, by and among MVE Holdings, Inc., a Delaware corporation (the "Company"),
Chart Industries, Inc., a Delaware corporation ("Parent"), Chart Acquisition
Company, a Delaware corporation and wholly owned subsidiary of Parent ("Sub"),
ACI Capital I, LLC, a Delaware limited liability company, in its own capacity
("ACI") and, with respect to the Class B Escrow Amount (as defined herein), as
agent and attorney-in-fact for each of the former members of MVE Investors, LLC
listed on Exhibit A hereto (the "Members", and ACI Capital I, LLC, in its
capacity as agent and attorney-in-fact for the Members, the "Member
Representative"), Firstar Bank of Minnesota, N.A. (the "Escrow Agent").
W I T N E S S E T H:
WHEREAS, Parent, Sub and the Company have entered into an Agreement and
Plan of Merger, dated as of February 16, 1999 (the "Merger Agreement";
capitalized terms used and not otherwise defined herein are used herein as
defined in the Merger Agreement), pursuant to which Sub will be merged with and
into the Company and the Company shall become a wholly owned, direct subsidiary
of Parent (the "Merger");
WHEREAS, pursuant to the Merger Agreement, Parent will deposit with the
Escrow Agent on or prior to the effective time of the Merger (the "Effective
Time") the pro rata share of the Holdback Amount of those holders of common
stock, par value $.01 per share, of the Company (the "Common Stock"), and the
holders of the Public Note Warrants and the Exeter Warrants (to the extent not
put to the Company pursuant to the terms thereof; such holders of the Public
Note Warrants and the Exeter Warrants, together with the holders of the Common
Stock, are referred to collectively herein as the "Stockholders") who do not
execute and deliver prior to the Effective Time a consent and release pursuant
to Section 9.5 of the Merger Agreement (the "Common Escrow Amount"), to be held
in escrow by the Escrow Agent, subject to the terms, provisions and conditions
set forth herein and in the Merger Agreement, as security for certain
indemnification and reimbursement obligations of the Stockholders to the
Indemnitees and their affiliates as described in the Merger Agreement.
WHEREAS, the Company, Chart and the Members shall enter into an
Indemnification and Warrant Purchase Agreement (the "Indemnification
Agreement"), dated as of the date of the Effective Time, providing for the Class
B Escrow Amount (as defined herein) and defining the uses thereof;
WHEREAS, pursuant to the Indemnification Agreement, Chart shall deposit
with the Escrow Agent, on or prior to the Effective Time, an amount in cash
equal to (a) the accrued but unpaid dividends on 576.76 shares of 10% Class B
Cumulative Preferred Stock, par value $100.00 per share, of the Company, plus
(b) any amounts recovered by the Company in respect of the Company assignment of
certain rights to collect indemnification payments in respect of certain tax
issues under that certain Agreement,
<PAGE>
dated August 27, 1996 among Robert E. Cieslukowski, Cieslukowski Family Limited
Partnership, C.J. Schoenbauer, H. Michael Lutgen, R. Edwin Powell, Powell Family
Limited Partnership, John J. Pint, Michael Tate, JMS Family Limited Partnership
and O'Halloran Family Limited Partnership, which collection rights have been
assigned to the Company pursuant to a letter agreement, dated February 11, 1999,
among MVE Inc. and Messrs. Clemence J. Schoenbauer and H. Michael Lutgen, minus
(c) $296,035 (the "Class B Escrow Amount"), to be held in escrow by the Escrow
Agent, subject to the terms, provisions and conditions set forth herein and in
the Indemnification Agreement;
WHEREAS, the Escrow Agent shall maintain a single escrow, containing both
the Common Escrow Amount and the Class B Escrow Amount (collectively, the
"Escrow Amount");
NOW, THEREFORE, in consideration of the premises and the mutual promises
contained herein, the parties hereto hereby agree as follows:
1. Appointment of the Escrow Agent.
(a) Upon the joint written agreement by the parties hereto, an
escrow agent shall be appointed as Escrow Agent hereunder.
(b) Upon such appointment, the Escrow Agent will acknowledge to the
parties hereto the receipt of the Escrow Amount.
2. Retention; Investment.
(a) The Escrow Agent shall hold and dispose of the Escrow Amount,
and shall act as Escrow Agent in accordance with the terms and provisions of
this Escrow Agreement, the Indemnification Agreement and the Merger Agreement.
The Escrow Amount shall be held and used solely for the purposes and subject to
the applicable conditions set forth in this Escrow Agreement, the
Indemnification Agreement and the Merger Agreement.
(b) The Common Escrow Amount shall be fully invested by the Escrow
Agent, at the joint written direction of ACI and Parent, signed and delivered to
the Escrow Agent (a "Joint Written Direction"), and the Class B Escrow Amount
shall be fully invested by the Escrow Agent, at the written direction of the
Member Representative, signed and delivered to the Escrow Agent (a "Written
Direction"), solely in one or more of the investments referred to below:
(i) short-term direct obligations of, or obligations
guaranteed by, the United States of America, or short-term
certificates of deposit or interest bearing accounts of any bank or
trust company, incorporated under the laws of the United States of
America, any state or the District of Columbia, which has combined
capital and surplus of not less than $500,000,000; or commercial
paper, maturing not more than 90 days from the date of issue, or
corporate demand notes, in each case rated at least A-l
2
<PAGE>
by Standard & Poor's Ratings Group or P-l by Moody's Investors
Service, Inc.; or investments in short-term asset management
accounts offered by any bank of the stature described above
investing solely in investments of the types described in this
clause (i); or
(ii) such other "investment grade" investments (the maturities
of which shall not at any time be later than the next anniversary of
the date hereof) which, with respect to the Common Escrow Amount,
may be determined by ACI and approved by Parent, such approval not
to be unreasonably withheld or delayed, and, with respect to the
Class B Escrow Amount, may be determined by the Member
Representative.
(c) In the absence of a Join Written Direction from ACI and Parent
as set forth in paragraph (b) above, the Escrow Agent shall invest the Common
Escrow Amount in the Escrow Agent's money market fund, the portfolio of which is
limited to U.S. government obligations. In the absence of a Written Direction
from the Member Representative as set forth in paragraph (b) above, the Escrow
Agent shall invest the Class B Escrow Amount in the Escrow Agent's money market
fund, the portfolio of which is limited to U.S. government obligations.
(d) Notwithstanding anything to the contrary contained herein, the
Escrow Agent may, without notice to any of the parties hereto, sell or liquidate
any of the foregoing investments at any time if the proceeds thereof are
required for any release of funds permitted or required hereunder, and the
Escrow Agent shall not be liable or responsible for any loss, cost or penalty
resulting from any such sale or liquidation.
(e) All interest accruing to the Common Escrow Amount shall be added
to the Common Escrow Amount. All interest accruing to the Class B Escrow Amount
shall be added to the Class B Escrow Amount.
3. Disbursements of the Escrow Amount. Subject to the terms of the
Indemnification Agreement and Article IX of the Merger Agreement, the Escrow
Agent shall disburse funds from the Escrow Amount in the manner provided below.
(a) Common Escrow Amount.
(i) Except as provided in Sections 3(a)(ii) and 3(a)(iii)
below, the Escrow Agent shall only make disbursements from the
Common Escrow Amount in accordance with a Joint Written Direction.
(ii) If, at any time prior to the sixth anniversary of the
effective time of the Merger Agreement (the "Common Escrow Amount
Termination Date"), a Stockholder executes a Consent and Release
substantially in the form of Exhibit B attached hereto (a
"Release"), releasing the Released Parties (as defined in the
Release) from any and all Liabilities (as defined in the Release),
in consideration for such Release
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the Escrow Agent shall deliver to such Stockholder his pro rata
portion of the Common Escrow Amount.
(iii) On the Common Escrow Amount Termination Date, the Escrow
Agent will assign and deliver, all remaining funds in the Common
Escrow Amount, pro rata, to Stockholders who have not previously
signed a Release.
(b) Class B Escrow Amount.
(i) The Escrow Agent shall only make disbursements from the
Class B Escrow Amount in accordance with a Written Direction.
(ii) The Member Representative, as agent and attorney-in-fact
for the Members, may, at its discretion and subject only to the
oversight of the Members, at any time and from time to time, issue a
Written Direction instructing the Escrow Agent to disburse all or
any portion of the Class B Escrow Amount for any reason authorized
by Article I of the Indemnification Agreement but subject to the
limitations contained therein.
(iii) The Class B Escrow Amount shall terminate upon the
two-year anniversary of the Effective Time. Upon that date, the
Escrow Agent shall distribute the remaining funds in the Class B
Escrow Amount to the Member Representative, who shall have sole use
of and discretion over such funds.
(c) The Escrow Agent is hereby authorized, in the event of any doubt
as to the course of action it should take under this Escrow Agreement, to
petition any United States Federal District Court for the District which
includes the State of Delaware, or any Delaware state court of competent
jurisdiction, for instructions or to interplead the funds or assets so held into
such court. The parties agree to the jurisdiction of either of said courts,
waive personal service of process, and agree that service of process by
certified or registered mail, return receipt requested, to such party's address
set forth herein shall constitute adequate service.
4. Duration. This Escrow Agreement shall continue in full force and effect
until the close of business on the day during which the last of the funds in the
Escrow Amount are distributed in full and all fees and related expenses of the
Escrow Agent hereunder have been paid pursuant to the terms hereof, at which
time this Escrow Agreement shall terminate. Upon termination of this Escrow
Agreement, the Escrow Agent shall be discharged from any further obligation
hereunder.
5. Escrow Provisions.
(a) The Escrow Agent shall keep separate and accurate accounts of
all income earned by each of the Common Escrow Amount and the Class B Escrow
Amount.
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(b) All fees and related expenses of the Escrow Agent for its
services hereunder in relation to the Common Escrow Amount shall be paid out of
the Common Escrow Amount. All fees and related expenses of the Escrow Agent for
its services hereunder in relation to the Class B Escrow Amount shall be paid
out of the Class B Escrow Amount. Such fees and expenses shall be determined in
accordance with the fee schedule attached hereto as Exhibit C.
(c) Within 30 days after the end of each calendar quarter, and at
such other times as ACI, Parent, or any Stockholder may reasonably request, the
Escrow Agent shall provide the requesting party with a full accounting of all
investments of the Common Escrow Amount and a report of all transactions with
respect to the Common Escrow Amount (including receipts, investments and
disbursements) not previously reported. Within 30 days after the end of each
calendar quarter, and at such other times as Parent, the Member Representative
or any Member may reasonably request, the Escrow Agent shall provide the
requesting party with a full accounting of all investments of the Class B Escrow
Amount and a report of all transactions with respect to the Class B Escrow
Amount (including receipts, investments and disbursements) not previously
reported.
6. Liability of the Escrow Agent.
(a) The Escrow Agent shall have no liability or obligation with
respect to the Escrow Amount except with respect to the Escrow Agent's willful
misconduct or gross negligence. The Escrow Agent's sole responsibility shall be
for the safekeeping, investment, and disbursement of the Escrow Amount in
accordance with the applicable terms of this Escrow Agreement, the
Indemnification Agreement and the Merger agreement. The Escrow Agent shall have
no implied duties or obligations and shall not be charged with knowledge or
notice of any fact or circumstance not specifically set forth herein, in the
Indemnification Agreement, in the Merger Agreement, in a Joint Written Direction
or in a Written Direction. In no event shall the Escrow Agent be liable for
incidental, indirect, special, consequential or punitive damages. The Escrow
Agent shall not be obligated to take any legal action or commence any proceeding
in connection with the Escrow Amount, any account in which the funds from the
Escrow Amount are deposited, this Escrow Agreement, the Indemnification
Agreement or the Merger Agreement. The Escrow Agent may consult legal counsel
selected by it in the event of any dispute or question as to the construction of
any of the provisions hereof or thereof or of its duties hereunder, and shall
incur no liability and shall be fully indemnified from any liability whatsoever
in acting in good faith in accordance with the opinion of such counsel. Upon
demand by the Escrow Agent to ACI, accompanied by written invoices, ACI shall
authorize disbursements from the Common Escrow Amount to pay the reasonable fees
and expenses of not more than one firm of such legal counsel retained by the
Escrow Agent where such fees and expenses are related to a dispute, question or
liability related to the Common Escrow Amount. Upon demand by the Escrow Agent
to the Member Representative, accompanied by written invoices, the Member
Representative shall authorize disbursements from the Class B Escrow Amount to
pay the reasonable fees and expenses of not more than one firm of such legal
counsel retained by
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the Escrow Agent where such fees and expenses are related to a dispute, question
or liability related to the Class B Escrow Amount.
(b) The Escrow Agent is authorized to comply with orders issued or
process entered by any court with respect to the Escrow Amount. If any portion
of the Escrow Amount is at any time attached, garnished or levied upon under any
court order, or in case the payment, assignment, transfer, conveyance or
delivery of any such property shall be stayed or enjoined by any court order, or
in case any order, judgment or decree shall be made or entered by any court
affecting such property or any part thereof, then and in any such event, the
Escrow Agent is authorized to rely in good faith upon and comply with any such
order, writ, judgment or decree which it is advised by legal counsel is binding
upon the Escrow Agent; and if the Escrow Agent complies with any such order,
writ judgment or decree, it shall not be liable to any of the parties hereto or
to any other person or entity by reason of such compliance.
7. Indemnification of the Escrow Agent. The Escrow Agent shall be entitled
to reimbursement for all losses, liabilities or expenses, including reasonable
attorneys' fees, incurred or made by it without gross negligence or bad faith
arising out of or in connection with its entering into this Escrow Agreement or
carrying out its duties hereunder, including the costs and expenses of defending
itself against any claim of liability. Any such compensation and reimbursement
in connection with the Common Escrow Amount to which the Escrow Agent is
entitled shall be paid out of the Common Escrow Amount. Any such compensation
and reimbursement in connection with the Class B Escrow Amount to which the
Escrow Agent is entitled shall be paid out of the Common Escrow Amount.
The parties agree that the disbursement of any amounts to the Escrow Agent
and each director, officer, employee, attorney, agent or affiliate of the Escrow
Agent (each an "Indemnified Party") from the Escrow Amount in respect of a claim
by the Escrow Agent or any Indemnified Party for indemnification shall not
impair, limit, modify or affect the respective rights and obligations of ACI,
the Member Representative, Parent, the Company, the Members and the Stockholders
under this Escrow Agreement or the Merger Agreement.
8. Tax Matters. The Escrow Agent shall have no tax reporting duties with
respect to the Escrow Amount or income thereon, such duties being the
responsibility of the party or parties which receive, or have the right to
receive, such funds or any taxable income hereunder.
9. Resignation of the Escrow Agent; Appointment of Successor. The Escrow
Agent acting at any time hereunder may resign at any time by giving 30 days'
prior written notice of resignation to ACI and Parent, such resignation to be
effective on the date specified in such notice, but in no event sooner than 30
days after the date of such notice. ACI and Parent shall appoint a bank or trust
company as successor to the Escrow Agent. Such successor to the Escrow Agent
shall succeed to all of the rights and obligations of the retiring Escrow Agent
as of the effective date of resignation and the retiring Escrow Agent shall duly
transfer and deliver the Escrow Amount (including all
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evidence of investment of the Escrow Amount) to the successor to the Escrow
Agent. If no successor shall have been appointed at the conclusion of such
30-day notice period, all obligations of the Escrow Agent hereunder shall cease
and terminate, and the Escrow Agent's sole responsibility shall be to keep
safely all property then being held by it and to deliver the same to a person
designated by the parties or in accordance with the directions of a final order
or judgment of a court of competent jurisdiction.
10. Governing Law. This Escrow Agreement shall be construed in accordance
with and governed by the laws of the State of Delaware, without reference to its
conflict of laws provisions.
11. Binding Effect. This Escrow Agreement shall be binding upon and inure
to the benefit of the Stockholders and the Members, and their respective heirs,
executors, administrators, successors and assigns. This Escrow Agreement also
shall be binding upon and inure to the benefit of ACI, Parent, the Member
Representative, the Company and the Escrow Agent and their respective successors
and assigns.
12. Notices. All notices required to permitted hereunder shall be in
writing and shall be deemed duly given when personally delivered or mailed by
registered or certified mail, return receipt requested, to the parties at the
following addresses (or at such other address for a party as shall be specified
by like notice) or sent by electronic transmission (with answerback confirmation
received) to the facsimile numbers specified below:
If to Parent, to: Chart Industries, Inc.
5885 Landerbrook Drive
Suite 150
Mayfield Heights, Ohio 44124
Attention: Arthur S. Holmes
Facsimile: (440) 753-1451
With a copy to: Calfee, Halter & Griswold LLP
1400 McDonald Investment Center
800 Superior Avenue
Cleveland, Ohio 44114-2688
Attention: Thomas F. McKee
Facsimile: (216) 241-0816
If to ACI or to the Member ACI Capital I, LLC
Representative, to: 707 Westchester Avenue
4th Floor
White Plains, New York 10604
Attention: Kevin Penn
Facsimile: (914) 681-9856
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With a copy to: Weil, Gotshal & Manges LLP
767 Fifth Avenue
New York, New York 10153
Attention: Stephen M. Besen
Facsimile: (212) 310-8007
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If to the Escrow Firstar Bank of Minnesota, N.A.
Agent, to: 101 East 5th Street
St. Paul, Minnesota 55101
Attn: Frank Leslie, Corporate Trust Department
Facsimile: (651)-229-6415
13. Entire Agreement. This Escrow Agreement, the Indemnification Agreement
and the Merger Agreement constitute the entire agreement among the parties
relating to the holding, investment and disbursement of the Escrow Amount and
set forth in their entirety the obligations and duties of the Escrow Agent with
respect to the Escrow Amount.
14. Counterparts. This Escrow Agreement may be executed in multiple
counterparts, each of which shall be an original, but all of which shall
constitute but one agreement.
[Signature page follows.]
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IN WITNESS WHEREOF, the parties have caused this Escrow Agreement to be duly
executed on the day and year first above written.
MVE HOLDINGS, INC.
By: /s/ John M. Kucharik
---------------------------------
Name: John M. Kucharik
Title: President and CEO
CHART INDUSTRIES, INC.
By: /s/ Arthur S. Holmes
----------------------------------
Name: Arthur S. Holmes
Title: Chairman and Chief Executive Officer
CHART ACQUISITION COMPANY
By: /s/ Arthur S. Holmes
----------------------------------
Name: Arthur S. Holmes
Title: Chairman and Chief Executive Officer
ACI CAPITAL I, LLC
By: /s/ Kevin S. Penn
-----------------------------------
Name: Kevin S. Penn
Title: President
ACI CAPITAL I, LLC, as the
Member Representative
By: /s/ Kevin S. Penn
-----------------------------------
Name: Kevin S. Penn
Title:
FIRSTAR BANK OF MINNESOTA, N.A.,
as Escrow Agent
By: /s/ Frank P. Leslie
-----------------------------------
Name: Frank P. Leslie
Title: Vice President
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Exhibit A
Former Members of MVE Investors, LLC
ACI Capital I, LLC
American Securities Partners, L.P.
MVE Cryogenics LLC
CRM/MVE Capital LLC
Tangent LLC
Fertosa LLC
Fertosa LLC
Burden Direct Investment Fund II
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Exhibit B
FORM OF CONSENT AND RELEASE
Reference is made to the Agreement and Plan of Merger (the "Merger Agreement")
among MVE Holdings, Inc., a Delaware corporation (the "Company"), Chart
Industries, Inc., a Delaware corporation ("Chart") and Chart Acquisition
Company, a Delaware corporation and wholly-owned subsidiary of Chart ("Sub"),
dated as of February 16, 1999, pursuant to which Sub shall be merged with and
into the Company (the "Merger"). According to the terms of the Merger Agreement,
each holder of common stock, par value $.01 per share, of the Company (the
"Common Stock"), will be entitled to receive aggregate merger consideration (the
"Common Stock Merger Consideration") of $45 per share of Common Stock held by
such holder as of the effective time of the Merger (the "Effective Time").
Pursuant to the terms of the Merger Agreement, the Common Stock Merger
Consideration shall be paid to holders of Common Stock as follows: (i) $25 per
share of Common Stock will be paid to the holders of Common Stock at or shortly
after the Effective Time, and (ii) $20 per share of Common Stock will be held in
escrow and will be subject to reduction for certain potential indemnification
claims (the "Escrow Amount"), which escrow will terminate on the sixth
anniversary of the Effective Time.
In consideration of the payment and release, at the Effective Time, of the
portion of the Escrow Amount payable to the undersigned, without reduction for
any future indemnification claims of third parties, the undersigned hereby (i)
consents, as a holder of Common Stock, to the adoption and approval of the
Merger Agreement and to the transactions contemplated thereby, including the
Merger and (ii) on behalf of himself, herself or itself and on behalf of his,
her or its heirs, executors, administrators, legal representatives, successors
and assigns, releases and forever discharges each of the Company and its
subsidiaries, Chart, Sub, MVE Investors, LLC, a Delaware limited liability
company, and each of their respective past, present and future shareholders,
members, directors, officers, employees, controlling persons and affiliates, and
their respective successors and assigns (each, a "Released Party," and
collectively, the "Released Parties"), from any and all claims, actions, causes
of action, awards, judgments, payments, losses, damages, expenses, rights and
liabilities (collectively, "Liabilities"), from the beginning of time through
the Effective Time, of every kind and nature, known and unknown, at law and in
equity, which relate in any way to (x) the Merger Agreement and the transactions
contemplated thereby, including, without limitation, any Liability arising out
of or in connection with any action, suit or proceeding brought by or on behalf
of any holder or former holder of Common Stock challenging or disputing the
allocation of the consideration in the Merger among the holders of Common Stock
and the holder(s) of Class A Cumulative Convertible Participating Preferred
Stock, par value $100 per share; (y) (i) the Recapitalization Agreement, dated
as of July 22, 1996, among the Company, MVE, Inc., MVE Investors, LLC and the
stockholders named therein (the "Recapitalization Agreement") and (ii) the First
Amendment to the Recapitalization Agreement, dated as of August 27, 1996, among
the Company, MVE, Inc., MVE Investors, LLC and the stockholders named therein
(the "Amendment"), and the transactions and agreements contemplated or executed
in connection with either the
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Recapitalization Agreement or the Amendment; and (z) any and all actions,
agreements, documents or instruments taken by or entered into by or on behalf of
any Released Party.
The undersigned hereby acknowledges that the undersigned has been advised to
consult counsel before signing this Consent and Release, and has had ample
opportunity to do so.
This Consent and Release is governed and construed by the laws of the State of
Delaware.
Agreed and Accepted, this
___ day of ___________, 1999.
________________________________
Name:
Address:
Number of shares of
Common Stock Owned: ________
Attest:
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Exhibit C
FEE SCHEDULE
Fees payable annually to the Escrow Agent shall equal $1,000 plus
out-of-pocket-expenses.
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