<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
----------------------------
F O R M 10-Q
For the Quarter Ended April 1, 1995 Commission File Number 1-5315
----------------------------
S P R I N G S I N D U S T R I E S, I N C.
(Exact name of registrant as specified in its charter)
SOUTH CAROLINA 57-0252730
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
205 North White Street
Fort Mill, South Carolina 29715
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code:
(803) 547-1500
----------------------------
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
Registrant was required to file such reports), and (2) has been subject to such
filing requirements for at least the past 90 days.
Yes X No
----- -----
----------------------------
As of May 5, 1995, there were 9,781,157 shares of Class A Common Stock and
7,830,375 shares of Class B Common Stock of Springs Industries, Inc.
outstanding.
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There are 87 pages in the sequentially numbered, manually signed original of
this report.
Page 1 of 87
<PAGE> 2
TABLE OF CONTENTS TO FORM 10-Q
PART I - FINANCIAL INFORMATION
- ------------------------------
<TABLE>
<CAPTION>
ITEM PAGE
- ---- ----
<S> <C>
1. FINANCIAL STATEMENTS 3
2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS 8
PART II - OTHER INFORMATION
- ---------------------------
4. SUBMISSION OF MATTERS TO A VOTE 10
OF SECURITY HOLDERS
6. EXHIBITS 11
SIGNATURES 12
EXHIBIT INDEX 13
</TABLE>
Page 2 of 87
<PAGE> 3
PART I
ITEM I - FINANCIAL STATEMENTS
SPRINGS INDUSTRIES, INC.
Condensed Consolidated Statements of Operations
and Retained Earnings
(In thousands except per share data)
(Unaudited)
<TABLE>
<CAPTION>
THIRTEEN WEEKS
-------------------------
APRIL 1, APRIL 2,
1995 1994
---------- ----------
<S> <C> <C>
OPERATIONS
Net sales . . . . . . . . . . . . . . . . . . . . . $ 483,136 $ 485,213
Cost of goods sold . . . . . . . . . . . . . . . 396,028 394,521
Selling, general and
administrative expenses . . . . . . . . . . . . 64,010 72,390
---------- ----------
Operating income . . . . . . . . . . . . . . . 23,098 18,302
Interest expense . . . . . . . . . . . . . . . . 7,252 7,179
Other (income) expense . . . . . . . . . . . . . (835) 764
---------- ----------
Income before income taxes . . . . . . . . . . . . 16,681 10,359
Income taxes . . . . . . . . . . . . . . . . . . . 6,813 4,558
---------- ----------
Net income . . . . . . . . . . . . . . . . . . $ 9,868 $ 5,801
========== ==========
Per share:
Net income . . . . . . . . . . . . . . . . . . . . $ .55 $ .33
========== ==========
Cash dividends - Class A shares . . . . . . . . . . $ .30 $ .30
========== ==========
Cash dividends - Class B shares . . . . . . . . . . $ .27 $ .27
========== ==========
Weighted average shares of
common stock . . . . . . . . . . . . . . . . . . . 17,807 17,813
========== ==========
RETAINED EARNINGS
Retained earnings at beginning
of period . . . . . . . . . . . . . . . . . . . . $ 568,403 $ 526,428
Net income . . . . . . . . . . . . . . . . . . . . 9,868 5,801
Cash dividends . . . . . . . . . . . . . . . . . . (5,046) (5,041)
---------- ----------
Retained earnings at end of period . . . . . . . . $ 573,225 $ 527,188
========== ==========
</TABLE>
Page 3 of 87
<PAGE> 4
SPRINGS INDUSTRIES, INC.
Condensed Consolidated Balance Sheet
(In thousands except share data)
<TABLE>
<CAPTION>
(UNAUDITED)
APRIL 1, DECEMBER 31,
1995 1994
---------- -----------
<S> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents . . . . . . . . . . . . . . . . . . . . . . . $ 1,142 $ 769
Accounts receivable . . . . . . . . . . . . . . . . . . . . . . . . . . 300,175 312,739
Inventories . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 299,229 264,161
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40,169 39,335
---------- -----------
Total current assets 640,715 617,004
---------- -----------
Property, plant and equipment . . . . . . . . . . . . . . . . . . . . . . 1,271,382 1,253,060
Accumulated depreciation . . . . . . . . . . . . . . . . . . . . . . . (717,598) (697,810)
---------- -----------
Property, plant, and equipment, net . . . . . . . . . . . . . . . . . 553,784 555,250
---------- -----------
Other assets and deferred charges . . . . . . . . . . . . . . . . . . . . 119,775 116,789
---------- -----------
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $1,314,274 $ 1,289,043
========== ===========
LIABILITIES AND SHAREOWNERS' EQUITY
Current liabilities:
Short-term borrowings . . . . . . . . . . . . . . . . . . . . . . . . . $ 55,600 $ 11,100
Current maturities of long-term debt . . . . . . . . . . . . . . . . . 21,391 21,318
Accounts payable . . . . . . . . . . . . . . . . . . . . . . . . . . . 76,720 83,232
Other accrued liabilities . . . . . . . . . . . . . . . . . . . . . . . 115,975 128,306
---------- -----------
Total current liabilities . . . . . . . . . . . . . . . . . . . . . . 269,686 243,956
---------- -----------
Noncurrent liabilities:
Long-term debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . 261,786 265,384
Long-term benefit plans and deferred
compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 141,856 144,967
Deferred income taxes and other deferred
credits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50,841 50,645
---------- ----------
Total noncurrent liabilities . . . . . . . . . . . . . . . . . . . . 454,483 460,996
---------- ----------
Shareowners' equity:
Class A common stock- $.25 par value
(9,888,859 and 9,884,143 shares issued
in 1995 and 1994, respectively) . . . . . . . . . . . . . . . . . . . 2,472 2,471
Class B common stock- $.25 par value
(7,830,375 and 7,830,375 shares issued
in 1995 and 1994, respectively) . . . . . . . . . . . . . . . . . . . 1,958 1,958
Additional paid-in capital . . . . . . . . . . . . . . . . . . . . . . 11,657 11,413
Retained earnings . . . . . . . . . . . . . . . . . . . . . . . . . . . 573,225 568,403
Cost of Class A shares in treasury
(April 1, 1995-111,448 shares; Decem-
ber 31, 1994 - 119,585 shares) . . . . . . . . . . . . . . . . . . . (2,467) (2,602)
Currency translation adjustment 3,260 2,448
---------- -----------
Shareowners' equity . . . . . . . . . . . . . . . . . . . . . . . . . 590,105 584,091
---------- -----------
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $1,314,274 $ 1,289,043
========== ===========
</TABLE>
Page 4 of 87
<PAGE> 5
SPRINGS INDUSTRIES, INC.
Condensed Consolidated Statement of Cash Flows
(In thousands)
(Unaudited)
<TABLE>
<CAPTION>
THIRTEEN WEEKS ENDED
-----------------------
APRIL 1, APRIL 2,
1995 1994
--------- ---------
<S> <C> <C>
CASH PROVIDED (USED) BY:
Operating activities:
Net income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 9,868 $ 5,801
Adjustments to reconcile net income to
net cash provided (used) by operating
activities:
Depreciation and amortization . . . . . . . . . . . . . . . . . . . 23,304 23,205
Changes in operating assets and liabilities . . . . . . . . . . . . (37,250) (35,851)
Other, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (6,669) 705
--------- ---------
Net cash (used) by operating activities . . . . . . . . . . . . . (10,747) (6,140)
--------- ---------
Investing activities:
Purchase of property, plant and
equipment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (19,727) (26,955)
Proceeds from sales of assets . . . . . . . . . . . . . . . . . . . . 43 -
--------- ---------
Net cash (used) by investing activities . . . . . . . . . . . . . (19,684) (26,955)
--------- ---------
Financing activities:
Proceeds from short-term borrowings . . . . . . . . . . . . . . . . . 44,500 46,980
Proceeds from commercial paper and long-term
debt borrowings . . . . . . . . . . . . . . . . . . . . . . . . . . 9,959 106
Payment of commercial paper and long-term debt . . . . . . . . . . . (13,484) (3,528)
Payment of dividends. . . . . . . . . . . . . . . . . . . . . . . . . (10,171) (10,080)
--------- ---------
Net cash provided by financing activities . . . . . . . . . . . . 30,804 33,478
--------- ---------
Increase in cash and cash equivalents . . . . . . . . . . . . . . . . . $ 373 $ 383
========= =========
</TABLE>
Page 5 of 87
<PAGE> 6
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
1. Significant Accounting Policies:
These condensed consolidated financial statements should be read in
conjunction with the financial statements presented in the Springs
Industries, Inc. ("Springs" or "the Company") 1994 Annual Report on Form
10-K.
In the opinion of the management of Springs, these unaudited condensed
consolidated financial statements contain all adjustments of a normal
recurring nature necessary for their fair presentation. The results for
interim periods reflect estimates for certain items which can be
definitively determined only on an annual basis. These items include the
valuation of a substantial portion of inventories on a LIFO cost basis and
the provision for income taxes. These interim financial statements
reflect applicable portions of the estimated annual amounts for such
items.
The results of operations for interim periods are not necessarily
indicative of operating results to be expected for the remainder of the
year.
2. Inventory:
Inventories are summarized as follows (in thousands):
<TABLE>
<CAPTION>
April 1, December 31,
1995 1994
--------- ------------
<S> <C> <C>
Standard cost (which approximates
average cost) or average cost:
Finished goods . . . . . . . . . . . . . . . . $ 190,460 $ 173,729
In process . . . . . . . . . . . . . . . . . . 182,605 166,347
Raw materials and supplies . . . . . . . . . . 60,016 56,553
--------- ---------
433,081 396,629
Less LIFO reserve . . . . . . . . . . . . . . . . (133,852) (132,468)
--------- ---------
Total . . . . . . . . . . . . . . . . . . . . . $ 299,229 $ 264,161
========= =========
</TABLE>
3. Acquisitions:
Subsequent to the Company's year-end, a definitive merger agreement was
signed with Dundee Mills, Incorporated regarding the Company's acquisition
of Dundee. Dundee is a significant manufacturer of towels sold to retail
and institutional markets, as well as textile products for infants.
Dundee operates 14 facilities, primarily in Georgia. Consummation of the
acquisition is subject to approval by Dundee shareholders on May 25, 1995.
The Company has also signed a definitive agreement regarding the Company's
purchase of certain assets of Dawson Home Fashions, Inc., which is a major
producer and marketer of shower curtains, coordinated accessories and
other bath products. Consummation of this transaction is subject to
appropriate governmental clearances.
Page 6 of 87
<PAGE> 7
4. Accounting Change:
In the first quarter of 1995, the Company completed an evaluation of
indirect manufacturing costs that in 1994 and prior years were classified
as selling, general and administrative expenses. As a result of that
evaluation, the Company has made an accounting change to include in
its inventory costs certain indirect manufacturing and
manufacturing-related information services costs. The Company believes
this accounting change is preferable and these costs are more
appropriately reflected as costs of the goods sold due to changing
technologies and reengineering of the delivery process for indirect
support services. No material effect on inventory or net income resulted
from the accounting change. In addition, certain other costs relating to
designs have been reclassified in the prior year to conform to the 1995
presentation.
5. Legal and Environmental:
As disclosed in the 1994 Annual Report on Form 10-K, Springs is involved
in certain administrative proceedings alleging violations of environmental
laws and regulations, including proceedings under the Comprehensive
Environmental Response, Compensation, and Liability Act. In connection
with these proceedings, the Company has accrued an amount which represents
management's best estimate of Springs' probable liability.
Springs is also involved in various other legal proceedings and claims
incidental to its business. Springs is defending its position in all such
proceedings.
In the opinion of management, based on the advice of counsel, the
resolution of the above matters should not have a material adverse impact
on the financial condition nor the future results of operations of
Springs.
Page 7 of 87
<PAGE> 8
ITEM 2. - MANAGEMENT'S DISCUSSION AND ANALYSIS
RESULTS OF OPERATIONS
Sales
Net sales for the first quarter were down less than one percent from those
reported in the first quarter of 1994. However, after reducing sales in the
first quarter of 1994 for sales of Clark-Schwebel Distribution Corp., which
was sold in June 1994, sales for the first quarter of 1995 increased four
percent over the same period one year ago. In the home furnishings segment,
first-quarter sales improved nearly six percent over the prior year as a result
of improved pricing and volume. In the specialty fabrics segment, after
adjustment for the sale of Clark-Schwebel Distribution Corp., sales were
slightly higher than in the first quarter of 1994. This improvement is due to
increased volume in industrial fabrics, partially offset by weaker demand for
finished fabrics.
Earnings
First-quarter net income of $.55 per share represented a sixty-seven percent
increase from net income of $.33 per share in 1994. Operating profits for the
home furnishings segment improved substantially over last year. This
improvement was due to increased volume as well as higher margins which
resulted from cost reductions and a general price increase for bedding products
which became effective during the third quarter of 1994. In the specialty
fabrics segment, after adjustment for the sale of Clark-Schwebel Distribution
Corp. in June 1994, operating profits were somewhat lower than in the prior
year as a result of lower volume and margins in finished fabrics, which more
than offset improvements in both volume and margins in industrial fabrics. In
addition, the results from the Company's minority equity investments in Germany
and Japan continued to improve.
CAPITAL RESOURCES AND LIQUIDITY
A normal seasonal increase in working capital since year-end resulted in
increased short-term borrowings. Capital expenditures for 1995 are expected to
approximate those of 1994. Operating cash needs for 1995 are expected to be
provided from operations and commercial paper and short-term bank borrowings.
During the first quarter of 1995, the Company signed a definitive merger
agreement with Dundee Mills, Incorporated. Dundee shareholders would receive a
combination of Springs Class A Common Stock and cash having an aggregate value
of approximately $118 million, based on the expected values of Springs stock, in
exchange for all of the outstanding shares of Dundee common stock. In
addition, the Company has also signed a definitive cash purchase agreement
regarding the Company's purchase of certain assets of Dawson Home Fashions,
Inc. Funding for the transactions will be provided by the issuance of new
shares of the Company's Class A Common Stock and long-term borrowings under the
term loan agreement dated as of March 31, 1995.
OTHER
In view of recent upward trends in the costs of raw materials, Springs expects
its earnings to grow at a more moderate pace during the second quarter.
Consummation of the Dundee acquisition noted above is subject to approval by
Dundee shareholders on May 25, 1995. Dundee is a significant manufacturer of
towels sold to retail and institutional markets, as well as textile products
Page 8 of 87
<PAGE> 9
for infants. Dundee operates 14 facilities, primarily in Georgia. In
addition, consummation of the Dawson transaction noted above is subject to
appropriate governmental clearances. Dawson is a major producer and marketer
of shower curtains, coordinated accessories and other bath products.
During the first quarter of 1995, the Company completed an evaluation of
indirect manufacturing costs that in 1994 and prior years were classified as
selling, general and administrative expenses. As a result of that evaluation,
the Company has made an accounting change to include in its inventory costs
certain indirect manufacturing and manufacturing-related information services
costs. The Company believes this accounting change is preferable and these
costs are more appropriately reflected as costs of the goods sold due to
changing technologies and reengineering of the delivery process for indirect
support services. No material effect on inventory or net income resulted from
the accounting change. In addition, certain other costs relating to designs
have been reclassified from selling, general and administrative expenses to
cost of goods sold and restated in the prior year to conform to the 1995
presentation. The result of this accounting change and cost reclassification
is to state first-quarter 1995 selling, general and administrative expenses at
approximately 13.3% of sales. Had prior year figures been restated for the
accounting change, prior year first-quarter selling, general and administrative
expenses under the preferred method of cost classification would have been
equivalent to 12.5% of sales.
Page 9 of 87
<PAGE> 10
PART II - OTHER INFORMATION
ITEM 4 - SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
(a) The annual meeting of the security holders of the Company was held
on May 1, 1995.
(b) During the annual meeting, the security holders of the Company
elected the following directors to hold office until the next annual meeting of
the security holders and until a successor is duly elected and qualified:
John F. Akers Dan M. Krausse
Crandall Close Bowles John H. McArthur
John L. Clendenin Aldo Papone
Leroy S. Close Robin B. Smith
Charles W. Coker Sherwood H. Smith, Jr.
Walter Y. Elisha Stewart Turley
(c)
<TABLE>
<CAPTION>
Description of Matter For Against or Abstentions
Voted Upon Withheld
<S> <C> <C> <C>
(i)
Annual election of
directors:
John F. Akers 37,350,057 58,389
Crandall Close Bowles 37,354,717 53,729
John L. Clendenin 37,353,517 54,929
Leroy S. Close 37,354,572 53,874
Charles W. Coker 37,355,083 53,363
Walter Y. Elisha 37,354,588 53,858
Dan M. Krausse 37,354,561 53,885
John H. McArthur 37,354,283 54,163
Aldo Papone 37,354,770 53,676
Robin B. Smith 37,352,104 56,342
Sherwood H. Smith, Jr. 37,354,727 53,719
Stewart Turley 37,354,967 53,479
(ii)
Ratification of the 37,382,605 13,692 12,149
appointment of Deloitte &
Touche as the Company's
auditors
</TABLE>
(d) N/A
Page 10 of 87
<PAGE> 11
ITEM 6 - EXHIBITS
The following exhibit is filed as part of this report:
(a) Exhibits required to be listed by Item 601 of Regulation S-K are
listed (and, where applicable, attached) in the Exhibit Index attached hereto,
which is incorporated herein by this reference.
(b) Reports on Form 8-K: No 8-K's were filed during the last quarter of
the period covered by this report.
Page 11 of 87
<PAGE> 12
SIGNATURES
Pursuant to the requirements of Securities Exchange Act of 1934, Springs
Industries, Inc. has duly caused this Report to be signed on its behalf by the
undersigned thereunto duly authorized.
SPRINGS INDUSTRIES, INC.
By:_______________________________
James F. Zahrn
Senior Vice President and
Chief Financial Officer
(Duly Authorized Officer and
Principal Financial Officer)
DATED: May 16, 1995
Page 12 of 87
<PAGE> 13
EXHIBIT INDEX
<TABLE>
<CAPTION>
Item Page Number
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(2) Agreement and Plan of Merger among Springs Industries, Incorporated
Inc., Dundee Acquisition Corp. and Dundee Mills, by reference
Incorporated, dated February 6, 1995, incorporated by
reference from Form 10-K filed March 6, 1995 (62 pages)
(3) (a) Springs' Restated Articles of Incorporation, amended and Incorporated
restated as of April 18, 1994, incorporated by reference by reference
from Form 10-Q filed August 15, 1994 (16 pages).
(b) Springs' Bylaws, amended as of April 18, 1994, Incorporated
incorporated by reference from Form 10-Q, filed May 17, by reference
1994 (19 pages).
(10) Material Contracts - Executive Compensation Plans and Arrangements
(a) Springs' Deferred Unit Stock Plan, amended and restated Incorporated
effective February 22, 1990, incorporated by reference by reference
from Form 10-K, filed March 26, 1990 (15 pages).
Amendment effective December 10, 1990, incorporated by
reference from Form 10-K, filed March 25, 1991 (1 page).
Amendment effective August 16, 1990, incorporated by
reference from Form 10-Q, filed November 12, 1991 (1
page).
(b) Springs' Restricted Stock Plan, incorporated by reference Incorporated
from Form 10-K, filed March 19, 1982 (6 pages). Amendment by reference
dated August 19, 1983, incorporated by reference from Form
10-K, filed March 16, 1984 (1 page).
(c) Employment Agreement dated July 1, 1985, between Springs Incorporated
and Walter Y. Elisha, incorporated by reference from by reference
Form 10-K, filed March 14, 1986 (9 pages).
(d) Springs' Deferred Compensation Plan, as amended and Incorporated
restated on August 18, 1994, incorporated by reference by reference
from Form 10-Q, filed November 14, 1994 (28 pages).
</TABLE>
Page 13 of 87
<PAGE> 14
<TABLE>
<S> <C> <C>
(e) Springs' Senior Executive Supplemental Retirement Plan, Incorporated
incorporated by reference from Form 10-K, filed March 19, by reference
1982 (11 pages). Amendment dated February 26, 1987,
incorporated by reference from Form 10-K, filed March 27,
1987 (4 pages). Amendment dated June 20, 1991,
incorporated by reference from Form 10-K, filed March 25,
1992 (1 page).
(f) Springs' Shadow Retirement Plan, incorporated by reference Incorporated
from Form 10-K, filed March 19, 1982 (6 pages). Amendment by reference
adopted October 18, 1990, incorporated by reference from
Form 10-K, filed March 25, 1991 (3 pages).
(g) Springs' Deferred Compensation Plan for Outside Directors, Incorporated
as amended and restated on August 18, 1994, incorporated by reference
by reference from Form 10-Q, filed November 14, 1994 (24
pages).
(h) Springs' Outside Directors COLI Deferred Compensation Plan Incorporated
adopted December 12, 1985, incorporated by reference from by reference
Form 10-K, filed March 14, 1986 (10 pages).
(i) Springs' Senior Management COLI Deferred Compensation Plan Incorporated
adopted December 12, 1985, incorporated by reference from by reference
Form 10-K, filed March 14, 1986 (11 pages).
(j) Springs' 1991 Incentive Stock Plan, as approved by Incorporated
shareholders on April 15, 1991, incorporated by reference by reference
from the Company's Proxy Statement to Shareholders dated
February 27, 1991, under the caption "Exhibit A" on
pages A-1 through A-12 of such Proxy Statement.
(k) Springs' 1991 Restricted Stock Plan for Outside Directors, Incorporated
as approved by the Company's shareholders on April 15, by reference
1991, incorporated by reference from the Company's Proxy
Statement to Shareholders dated February 27, 1991, under
the caption "Exhibit B" on pages B-1 through B-4 of such
Proxy Statement.
</TABLE>
Page 14 of 87
<PAGE> 15
<TABLE>
<S> <C> <C>
(l) Springs' Amended and Restated Achievement Incentive Plan, Incorporated
as approved by the Board of Directors on April 13, 1992, by reference
incorporated by reference from Form 10-Q, filed May 11,
1992 (12 pages). Amendment approved by the Board of
Directors on February 18, 1993, incorporated by reference
from Form 10-K, filed March 31, 1993 (10 pages).
(m) Springs' Contingent Compensation Plan adopted by the Board Incorporated
of Directors on June 20, 1991, incorporated by reference by reference
from Form 10-Q, filed November 12, 1991 (6 pages).
(10) Material Contracts - Other
(a) Loan Agreement dated July 7, 1986, among Springs Incorporated
Industries, Inc., Wachovia Bank, N.A., Chemical Bank, by reference
Manufacturers Hanover Bank (Delaware), NCNB National Bank
of North Carolina and The South Carolina National Bank,
incorporated by reference from Form 10-Q, filed August 19,
1986 (66 pages). Amendments effective June 5, 1989, and
September 29, 1989, incorporated by reference from
Form 10-K, filed March 26, 1990 (4 pages). Amendment
effective December 27, 1990, incorporated by reference
from Form 10-K, filed March 25, 1991 (2 pages). Amendment
effective May 13, 1992, incorporated by reference from
Form 10-K, filed March 31, 1993 (2 pages). Amendment
effective March 27, 1993, incorporated by reference from
Form 10-K, filed March 30, 1994 (3 pages). Amendment
dated November 16, 1994, incorporated by reference from
Form 10-K filed March 6, 1995 (1 page).
</TABLE>
Page 15 of 87
<PAGE> 16
<TABLE>
<S> <C> <C>
(b) Note Agreement for 9.375% Senior Notes Due July 1, 2006, Incorporated
dated as of July 7, 1986, incorporated by reference from by reference
Form 10-Q, filed August 19, 1986 (53 pages). Amendment
effective September 29, 1989, incorporated by reference
from Form 10-K, filed March 26, 1990 (2 pages). Amendment
effective December 27, 1990, incorporated by reference
from Form 10-K, filed March 25, 1991 (2 pages). Amendment
effective March 29, 1992, incorporated by reference from
Form 10-K, filed March 31, 1993 (2 pages). Amendment
effective March 27, 1993, incorporated by reference from
Form 10-K, filed March 30, 1994 (3 pages).
(c) Long-term revolving credit agreements among Springs and Incorporated
several banks, dated February 1 or 2, 1990, as back-up for by reference
Springs' commercial paper program; commercial paper
issuing and paying agency agreement between Springs and
Morgan Guaranty Trust Company of New York dated
February 5, 1990, incorporated by reference from Form 10-
K, filed March 26, 1990 (52 pages). Amendment effective
December 27, 1990, incorporated by reference from Form 10-
K, filed March 25, 1991 (10 pages). Amendment effective
June 3, 1992, incorporated by reference from Form 10-K,
filed March 31, 1993 (5 pages). Amendment effective
March 27, 1993, incorporated by reference from Form 10-K,
filed March 30, 1994 (3 pages).
(d) Note Agreement for 9.60% Senior Notes Due July 1, 2006, Incorporated
dated as of May 29, 1991, incorporated by reference from by reference
Form 10-K, filed March 25, 1992 (47 pages). Amendment
effective March 29, 1992, incorporated by reference from
Form 10-K, filed March 31, 1993 (1 page). Amendment
effective March 27, 1993, incorporated by reference from
Form 10-K, filed March 30, 1994 (3 pages).
</TABLE>
Page 16 of 87
<PAGE> 17
<TABLE>
<S> <C> <C>
(e) Springs' Commercial paper issuing and paying agency Incorporated
agreement between Springs and Chemical Bank dated July 17, by reference
1992; Commercial paper dealer agreement between Springs
and Goldman Sachs Money Markets, L.P. dated July 16, 1992;
Long-term revolving credit agreements among Springs and
several banks, dated July 10-21, 1992, as back-up for
Springs' commercial paper program; all of which are
incorporated by reference from Form 10-Q, filed July 31,
1992 (49 pages). Amendment effective March 27, 1993,
incorporated by reference from Form 10-K, filed March 30,
1994 (4 pages).
(f) Long-Term revolving credit agreement between Springs and Incorporated
Trust Company Bank, dated April 1, 1993, as back-up for by reference
Springs' commercial paper program, incorporated by
reference from Form 10-Q, filed May 17, 1993 (4 pages).
(g) Term loan agreement dated as of March 31, 1995, among Page 18
Springs Industries, Inc., Wachovia Bank of North Carolina,
N.A., and Wachovia Bank of Georgia, N.A., as agent, filed
herein (69 pages)
(27) Financial Data Schedule (for SEC purposes) Page 87
</TABLE>
Page 17 of 87
<PAGE> 1
TABLE OF CONTENTS
CREDIT AGREEMENT
<TABLE>
<CAPTION>
Page
<S> <C>
ARTICLE I
DEFINITIONS . . . . . . . . . . . . . . . . . . . . 24
SECTION 1.01. Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
-----------
SECTION 1.02. Accounting Terms and Determinations . . . . . . . . . . . . . . . . . . . . . . . . 38
-----------------------------------
SECTION 1.03. References . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
----------
SECTION 1.04. Use of Defined Terms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
--------------------
SECTION 1.05. Terminology . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
-----------
ARTICLE II
THE CREDITS . . . . . . . . . . . . . . . . . . . . 39
SECTION 2.01. Commitments to Lend . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
-------------------
SECTION 2.02. Method of Borrowing Loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
-------------------------
SECTION 2.03. Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
-----
SECTION 2.04. Maturity of Loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
-----------------
SECTION 2.05. Interest Rates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
--------------
SECTION 2.06. Fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
----
SECTION 2.07. Optional Prepayments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
--------------------
SECTION 2.08. Mandatory Prepayments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
---------------------
SECTION 2.09. General Provisions as to Payments . . . . . . . . . . . . . . . . . . . . . . . . . 47
---------------------------------
SECTION 2.10. Computation of Interest and Fees . . . . . . . . . . . . . . . . . . . . . . . . . 48
--------------------------------
ARTICLE III
CONDITIONS TO CLOSING DATE AND BORROWINGS . . . . . . . . . . . . . 49
SECTION 3.01. Conditions to Occurrence of Closing Date . . . . . . . . . . . . . . . . . . . . . 49
----------------------------------------
SECTION 3.02. Conditions to All Borrowings . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
----------------------------
</TABLE>
Page 18 of 87
<PAGE> 2
<TABLE>
<S> <C>
ARTICLE IV
REPRESENTATIONS AND WARRANTIES . . . . . . . . . . . . . . . 51
SECTION 4.01. Corporate Existence and Power . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
-----------------------------
SECTION 4.02. Corporate and Governmental Authorization; No
--------------------------------------------
Contravention . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
-------------
SECTION 4.03. Binding Effect . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
--------------
SECTION 4.04. Financial Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
---------------------
SECTION 4.05. No Litigation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
-------------
SECTION 4.06. Compliance with ERISA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
---------------------
SECTION 4.07. Compliance with Laws; Payment of Taxes . . . . . . . . . . . . . . . . . . . . . . 53
--------------------------------------
SECTION 4.08. Subsidiaries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
------------
SECTION 4.09. Investment Company Act . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
----------------------
SECTION 4.10. Public Utility Holding Company Act . . . . . . . . . . . . . . . . . . . . . . . . 53
----------------------------------
SECTION 4.11. Ownership of Property; Liens . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
----------------------------
SECTION 4.12. No Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54
----------
SECTION 4.13. Full Disclosure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54
---------------
SECTION 4.14. Environmental Matters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54
---------------------
SECTION 4.15. Capital Stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54
-------------
SECTION 4.16. Margin Stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
------------
SECTION 4.17. Insolvency . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
----------
SECTION 4.18. Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
---------
ARTICLE V
COVENANTS . . . . . . . . . . . . . . . . . . . . . 56
SECTION 5.01. Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56
-----------
SECTION 5.02. Inspection of Property, Books and Records . . . . . . . . . . . . . . . . . . . . . 57
-----------------------------------------
SECTION 5.03. Leverage Ratio . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58
--------------
</TABLE>
Page 19 of 87
<PAGE> 3
<TABLE>
<S> <C>
SECTION 5.04. Ratio of Consolidated Debt to Consolidated
------------------------------------------
Total Tangible Capital . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58
----------------------
SECTION 5.05. Minimum Consolidated Tangible Net Worth . . . . . . . . . . . . . . . . . . . . . . 58
---------------------------------------
SECTION 5.06. Restricted Payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58
-------------------
SECTION 5.07. Loans or Advances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58
-----------------
SECTION 5.08. Investments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59
-----------
SECTION 5.09. Negative Pledge . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60
---------------
SECTION 5.10. Maintenance of Existence . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
------------------------
SECTION 5.11. Dissolution . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
-----------
SECTION 5.12. Consolidations, Mergers and Sales of Assets . . . . . . . . . . . . . . . . . . . . 61
-------------------------------------------
SECTION 5.13. Use of Proceeds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
---------------
SECTION 5.14. Compliance with Laws; Payment of Taxes . . . . . . . . . . . . . . . . . . . . . . 62
--------------------------------------
SECTION 5.15. Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
---------
SECTION 5.16. Change in Fiscal Year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63
---------------------
SECTION 5.17. Maintenance of Property . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63
-----------------------
SECTION 5.18. Environmental Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63
---------------------
SECTION 5.19. Environmental Matters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63
---------------------
SECTION 5.20. Environmental Release . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63
---------------------
SECTION 5.21. Transactions with Affiliates . . . . . . . . . . . . . . . . . . . . . . . . . . . 63
----------------------------
SECTION 5.22. Election to Become Guarantors; Release of
-----------------------------------------
Guarantors to be Sold . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 64
---------------------
ARTICLE VI
DEFAULTS . . . . . . . . . . . . . . . . . . . . . 64
SECTION 6.01. Events of Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 64
-----------------
SECTION 6.02. Notice of Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 67
-----------------
</TABLE>
Page 20 of 87
<PAGE> 4
<TABLE>
<S> <C>
ARTICLE VII
THE AGENT . . . . . . . . . . . . . . . . . . . . 67
SECTION 7.01. Appointment; Powers and Immunities . . . . . . . . . . . . . . . . . . . . . . . . 67
----------------------------------
SECTION 7.02. Reliance by Agent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 68
-----------------
SECTION 7.03. Defaults . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 68
--------
SECTION 7.04. Rights of Agent as a Bank . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 69
-------------------------
SECTION 7.05. Indemnification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 69
---------------
SECTION 7.06. Consequential Damages . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 69
---------------------
SECTION 7.07. Payee of Note Treated as Owner . . . . . . . . . . . . . . . . . . . . . . . . . . 70
------------------------------
SECTION 7.08. Nonreliance on Agent and Other Banks . . . . . . . . . . . . . . . . . . . . . . . 70
------------------------------------
SECTION 7.09. Failure to Act . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 70
--------------
SECTION 7.10. Resignation or Removal of Agent . . . . . . . . . . . . . . . . . . . . . . . . . . 70
-------------------------------
ARTICLE VIII
CHANGE IN CIRCUMSTANCES; COMPENSATION . . . . . . . . . . . . . 71
SECTION 8.01. Basis for Determining Interest Rate Inadequate
----------------------------------------------
or Unfair . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 71
---------
SECTION 8.02. Illegality . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 72
----------
SECTION 8.03. Increased Cost and Reduced Return . . . . . . . . . . . . . . . . . . . . . . . . . 72
---------------------------------
SECTION 8.04. Base Rate Loans Substituted for Affected Euro-
----------------------------------------------
Dollar Loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 74
------------
SECTION 8.05. Compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 74
------------
ARTICLE IX
MISCELLANEOUS . . . . . . . . . . . . . . . . . . . . 75
SECTION 9.01. Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 75
-------
SECTION 9.02. No Waivers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 75
----------
SECTION 9.03. Expenses; Documentary Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . 75
---------------------------
</TABLE>
Page 21 of 87
<PAGE> 5
<TABLE>
<S> <C>
SECTION 9.04. Indemnification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 76
---------------
SECTION 9.05. Setoff; Sharing of Setoffs . . . . . . . . . . . . . . . . . . . . . . . . . . . . 76
--------------------------
SECTION 9.06. Amendments and Waivers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 77
----------------------
SECTION 9.07. No Margin Stock Collateral . . . . . . . . . . . . . . . . . . . . . . . . . . . . 78
--------------------------
SECTION 9.08. Successors and Assigns . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 78
----------------------
SECTION 9.09. Confidentiality . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 80
---------------
SECTION 9.10. Representation by Banks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 81
-----------------------
SECTION 9.11. Obligations Several . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 81
-------------------
SECTION 9.12. Georgia Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 81
-----------
SECTION 9.13. Severability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 81
------------
SECTION 9.14. Interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 82
--------
SECTION 9.15. Interpretation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 83
--------------
SECTION 9.16. Waiver of Jury Trial; Consent to Jurisdiction . . . . . . . . . . . . . . . . . . . 83
---------------------------------------------
SECTION 9.17. Counterparts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 83
------------
SECTION 9.18. Source of Funds -- ERISA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 84
------------------------
EXHIBIT A Form of Note
- ---------
EXHIBIT B Form of Opinion of Counsel for the Borrower
- ---------
EXHIBIT C Form of Opinion of Special Counsel for the Agent
- ---------
EXHIBIT D Form of Assignment and Acceptance
- ---------
EXHIBIT E Form of Notice of Borrowing
- ---------
EXHIBIT F Form of Compliance Certificate
- ---------
EXHIBIT G Form of Closing Certificate
- ---------
EXHIBIT H Form of Funding Indemnification Letter
- ---------
EXHIBIT I Form of Guaranty
- ---------
EXHIBIT J Form of Contribution Agreement
- ---------
</TABLE>
Page 22 of 87
<PAGE> 6
Schedule 4.06 ERISA
- -------------
Schedule 4.08 Subsidiaries
- -------------
Schedule 4.14 Environmental Matters
- -------------
Page 23 of 87
<PAGE> 7
CREDIT AGREEMENT
CREDIT AGREEMENT dated as of March 31, 1995 among SPRINGS
INDUSTRIES, INC., the BANKS listed on the signature pages hereof and WACHOVIA
BANK OF GEORGIA, N.A., as Agent.
The parties hereto agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.01. Definitions. The terms as defined in this Section
1.01 shall, for all purposes of this Agreement and any amendment hereto (except
as herein otherwise expressly provided or unless the context otherwise
requires), have the meanings set forth herein:
"Adjusted London Interbank Offered Rate" has the meaning set forth
in Section 2.05(c).
"Affiliate" of any relevant Person means (i) any Person that
directly, or indirectly through one or more intermediaries, controls the
relevant Person (a "Controlling Person"), (ii) any Person (other than the
relevant Person or a Subsidiary of the relevant Person) which is controlled by
or is under common control with a Controlling Person, or (iii) any Person
(other than a Subsidiary of the relevant Person) of which the relevant Person
owns, directly or indirectly, 20% or more of the common stock or equivalent
equity interests. As used herein, the term "control" means possession,
directly or indirectly, of the power to direct or cause the direction of the
management or policies of a Person, whether through the ownership of voting
securities, by contract or otherwise.
"Agent" means Wachovia Bank of Georgia, N.A., a national banking
association organized under the laws of the United States of America, in its
capacity as agent for the Banks hereunder, and its successors and permitted
assigns in such capacity.
"Agent's Letter Agreement" means that certain letter agreement,
dated as of December 6, 1994 between the Borrower and the Agent relating to the
structure of the Loans, and certain fees from time to time payable by the
Borrower to the Agent, together with all amendments and supplements thereto.
The Agent's Letter Agreement shall not survive the execution and
Page 24 of 87
<PAGE> 8
delivery of this Agreement, except for purposes of determining fees pursuant to
Section 2.06(b).
"Agreement" means this Credit Agreement, together with all
amendments and supplements hereto.
"Anniversary Date" means, with respect to each Term Loan Advance,
each anniversary of the Drawdown Date for such Term Loan Advance.
"Applicable Margin" has the meaning set forth in Section 2.05(a).
"Assignee" has the meaning set forth in Section 9.08(c).
"Assignment and Acceptance" means an Assignment and Acceptance
executed in accordance with Section 9.08(c) in the form attached hereto as
Exhibit D.
"Authority" has the meaning set forth in Section 8.02.
"Bank" means each bank listed on the signature pages hereof as
having a Commitment, and its successors and assigns.
"Base Rate" means for any Base Rate Loan for any day, the rate per
annum equal to the higher as of such day of (i) the Prime Rate, or (ii)
one-half of one percent above the Federal Funds Rate. For purposes of
determining the Base Rate for any day, changes in the Prime Rate or the Federal
Funds Rate shall be effective on the date of each such change.
"Base Rate Loan" means a Loan to be made as a Base Rate Loan
pursuant to the applicable Notice of Borrowing, Section 2.02(e), or Article
VIII, as applicable.
"Borrower" means Springs Industries, Inc., a South Carolina
corporation, and its successors and its permitted assigns.
"Borrowing" means a borrowing hereunder consisting of Loans made to
the Borrower at the same time by all of the Banks, pursuant to Article II. A
Borrowing is a "Base Rate Borrowing" if such Loans are Base Rate Loans or a
"Euro-Dollar Borrowing" if such Loans are Euro-Dollar Loans. Each Borrowing
pertaining to a Term Loan Advance after the Drawdown Date for such Term Loan
Advance is a "Refunding Borrowing", and shall consist only of Refunding Loans.
Page 25 of 87
<PAGE> 9
"Capital Stock" means any nonredeemable capital stock of the
Borrower or any Consolidated Subsidiary (to the extent issued to a Person other
than the Borrower), whether common or preferred.
"CERCLA" means the Comprehensive Environmental Response Compensation
and Liability Act, 42 U.S.C. Section 9601 et. seq. and its implementing
regulations and amendments.
"CERCLIS" means the Comprehensive Environmental Response
Compensation and Liability Inventory System established pursuant to CERCLA.
"Change of Law" shall have the meaning set forth in Section 8.02.
"Closing Certificate" has the meaning set forth in Section 3.01(e).
"Closing Date" means the date on which each of the conditions set
forth in Section 3.01 has been satisfied.
"Code" means the Internal Revenue Code of 1986, as amended, or any
successor Federal tax code.
"Close Family Interests" means Anne Springs Close and members of her
family, the Close Family Trusts, The Springs Company and Central Reassurance
Corporation.
"Commitment" means, with respect to each Bank, the commitment of
each Bank to make Term Loan Advances in the aggregate amount set forth opposite
the name of such Bank on the signature pages hereof.
"Compliance Certificate" has the meaning set forth in Section
5.01(c).
"Consolidated Debt" means at any date the Debt of the Borrower and
its Consolidated Subsidiaries, determined on a consolidated basis as of such
date.
"Consolidated Interest Expense" for any period means interest,
whether expensed or capitalized, in respect of Debt of the Borrower or any of
its Consolidated Subsidiaries outstanding during such period.
"Consolidated Net Income" means, for any period, the Net Income of
the Borrower and its Consolidated Subsidiaries determined in accordance with
GAAP on a consolidated basis, but excluding (i) extraordinary items and (ii)
any gains resulting
Page 26 of 87
<PAGE> 10
from a write-up of assets, or any earnings of any Person acquired by the
Borrower or any Consolidated Subsidiary in a pooling of interests for any
Fiscal Year prior to the Fiscal Year of the date of measurement.
"Consolidated Net Income Available for Restricted Payments" means,
on any date, an amount equal to the sum of: (i) $40,000,000; plus (or minus, in
case of a deficit) (ii) 100% of Consolidated Net Income for the period (taken
as one accounting period) commencing on the Closing Date and terminating at the
end of the last Fiscal Quarter preceding the date of any proposed Restricted
Payment; less (iii) the aggregate amount of all Dividends paid or declared
after the Closing Date by the Borrower on any of its Capital Stock; and less
(iv) the excess of (A) the aggregate amount expended, directly or indirectly,
after the Closing Date for redemption, purchase, retirement or other
acquisition of any shares of its Capital Stock over (B) the aggregate amount
received after the Closing Date from sales of Capital Stock.
"Consolidated Subsidiary" means at any date any Subsidiary or other
entity the accounts of which, in accordance with GAAP, would be consolidated
with those of the Borrower in its consolidated financial statements as of such
date.
"Consolidated Tangible Net Worth" means, at any time, Stockholders'
Equity, less the sum of the value, as set forth or reflected on the most recent
consolidated balance sheet of the Borrower and its Consolidated Subsidiaries,
prepared in accordance with GAAP, of:
(A) Any surplus resulting from any write-up of assets
subsequent to January 1, 1994;
(B) All assets which would be treated as intangible assets for
balance sheet presentation purposes under GAAP, including without limitation
goodwill (whether representing the excess of cost over book value of assets
acquired, or otherwise), trademarks, tradenames, copyrights, patents and
technologies, and unamortized debt discount and expense;
(C) To the extent not included in (B) of this definition, any
amount at which shares of Capital Stock of the Borrower appear as an asset on
the balance sheet of the Borrower and its Consolidated Subsidiaries; and
(D) Loans or advances to stockholders, directors, officers or
employees.
Page 27 of 87
<PAGE> 11
"Consolidated Total Tangible Capital" means, at any time, the sum of
(i) Consolidated Tangible Net Worth, and (ii) Consolidated Debt, provided that
for purposes of this definition only, in determining Consolidated Debt, clauses
(vii), (viii) and (ix) of the definition of Debt contained in this Agreement
shall be disregarded.
"Contribution Agreement" means the Contribution Agreement of even
date herewith in substantially the form of Exhibit "J" to be executed by the
Borrower and each of the Guarantors.
"Controlled Group" means all members of a controlled group of
corporations and all trades or businesses (whether or not incorporated) under
common control which, together with the Borrower, are treated as a single
employer under Section 414 of the Code.
"Debt" of any Person means at any date, without duplication, (i) all
obligations of such Person for borrowed money, (ii) all obligations of such
Person evidenced by bonds, debentures, notes or other similar instruments,
(iii) all obligations of such Person to pay the deferred purchase price of
property or services, except trade accounts payable arising in the ordinary
course of business, (iv) all obligations of such Person as lessee under capital
leases, (v) all obligations of such Person to reimburse any bank or other
Person in respect of amounts payable under a banker's acceptance, (vi) all
Redeemable Preferred Stock of such Person (in the event such Person is a
corporation), (vii) all obligations of such Person to reimburse any bank or
other Person in respect of amounts paid under a standby (but not commercial)
letter of credit or similar instrument (but excluding such reimbursement
obligations pertaining to any variable rate demand bond while they remain
contingent due to there having been no presenting and honoring of a draft under
any such letter of credit or similar instrument), (viii) all Debt of others
secured by a Lien on any asset of such Person, whether or not such Debt is
assumed by such Person, and (ix) all Debt of others Guaranteed by such Person.
"Default" means any condition or event which constitutes an Event of
Default or which with the giving of notice or lapse of time or both would,
unless cured or waived, become an Event of Default.
"Default Rate" means, with respect to any Loan, on any day, the sum
of 2% plus the then highest interest rate (including the Applicable Margin)
which may be applicable to any Loans hereunder (irrespective of whether any
such type of Loans are actually outstanding hereunder).
Page 28 of 87
<PAGE> 12
"Dividends" means for any period the sum of all dividends or other
distributions paid or declared during such period in respect of any Capital
Stock and Redeemable Preferred Stock (other than dividends or other
distributions paid or payable in the form of additional Capital Stock).
"Dollars" or "$" means dollars in lawful currency of the United
States of America.
"Domestic Business Day" means any day except a Saturday, Sunday or
other day on which commercial banks in Georgia or North Carolina are authorized
by law to close.
"Domestic Subsidiary" means any Subsidiary created under the laws of
the United States of America or any state thereof.
"Drawdown Date", with respect to any Term Loan Advance, has the
meaning set forth in Section 2.01.
"EBITDA" means the sum of the following, calculated on a
consolidated basis in accordance with GAAP for the Borrower and its
Consolidated Subsidiaries at the end of each Fiscal Quarter for such Fiscal
Quarter and the 3 immediately preceding Fiscal Quarters: (i) Consolidated Net
Income; plus (ii) income taxes; plus (iii) Consolidated Interest Expense; plus
(iv) depreciation and amortization expense; and (v) other non-cash charges.
"Environmental Authority" means any foreign, federal, state, local
or regional government that exercises any form of jurisdiction or authority
under any Environmental Requirement.
"Environmental Authorizations" means all licenses, permits, orders,
approvals, notices, registrations or other legal prerequisites for conducting
the business of the Borrower or any Subsidiary required by any Environmental
Requirement.
"Environmental Judgments and Orders" means all judgments, decrees or
orders arising from or in any way associated with any Environmental
Requirements, whether or not entered upon consent, or written agreements with
an Environmental Authority or other entity arising from or in any way
associated with any Environmental Requirement, whether or not incorporated in a
judgment, decree or order.
"Environmental Liabilities" means any liabilities, whether accrued,
contingent or otherwise, arising from and in any way associated with any
Environmental Requirements.
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"Environmental Notices" means notice from any Environmental
Authority or by any other person or entity, of possible or alleged
noncompliance with or liability under any written Environmental Requirement,
including without limitation any complaints, citations, demands or requests
from any Environmental Authority or from any other person or entity for
correction of any violation of any Environmental Requirement or any
investigations concerning any violation of any Environmental Requirement.
"Environmental Proceedings" means any judicial or administrative
proceedings arising from or in any way associated with any Environmental
Requirement.
"Environmental Releases" means releases as defined in CERCLA or
under any applicable state or local environmental law or regulation.
"Environmental Requirements" means any legal requirement relating to
health, safety or the environment and applicable to the Borrower, any
Subsidiary or the Properties, including but not limited to any such requirement
under CERCLA or similar state legislation and all federal, state and local
laws, ordinances, regulations, orders, writs, decrees and common law.
"ERISA" means the Employee Retirement Income Security Act of 1974,
as amended from time to time, or any successor law. Any reference to any
provision of ERISA shall also be deemed to be a reference to any successor
provision or provisions thereof.
"Euro-Dollar Business Day" means any Domestic Business Day on which
dealings in Dollar deposits are carried out in the London interbank market.
"Euro-Dollar Loan" means a Loan to be made as a Euro-Dollar Loan
pursuant to the applicable Notice of Borrowing.
"Euro-Dollar Reserve Percentage" has the meaning set forth in
Section 2.05(c).
"Event of Default" has the meaning set forth in Section 6.01.
"Federal Funds Rate" means, for any day, the rate per annum (rounded
upward, if necessary, to the next higher 1/100th of 1%) equal to the weighted
average of the rates on overnight Federal funds transactions with members of
the Federal Reserve System arranged by Federal funds brokers on such day, as
published by the Federal Reserve Bank of New York on the Domestic Business Day
next succeeding such day, provided that (i) if the
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day for which such rate is to be determined is not a Domestic Business Day, the
Federal Funds Rate for such day shall be such rate on such transactions on the
next preceding Domestic Business Day as so published on the next succeeding
Domestic Business Day, and (ii) if such rate is not so published for any day,
the Federal Funds Rate for such day shall be the average rate charged to the
Agent on such day on such transactions, as determined by the Agent.
"Fifth Closing Date Anniversary" means the date which is the fifth
anniversary of the Closing Date.
"Fiscal Quarter" means any fiscal quarter of the Borrower.
"Fiscal Year" means any fiscal year of the Borrower.
"Foreign Subsidiary" means any Subsidiary which is not a Domestic
Subsidiary.
"Funding Indemnification Letter" means a letter from the Borrower to
the Agent substantially in the form of Exhibit H, pursuant to which (i) the
Banks and the Borrower shall agree upon the interest rates, amount of Borrowing
and Interest Periods for each portion of the initial funding on the initial
Drawdown Date of the Term Loan Advance to be made on such date which is to
constitute a Euro-Dollar Loan, and (ii) the Borrower shall indemnify the Banks
from any loss or expense arising from the failure to close on the anticipated
Closing Date identified in such letter or the failure to borrow such
Euro-Dollar Loan on such date, unless such failure is caused solely by the
Banks' breach of this Agreement.
"GAAP" means generally accepted accounting principles applied on a
basis consistent with those which, in accordance with Section 1.02, are to be
used in making the calculations for purposes of determining compliance with the
terms of this Agreement.
"Guarantee" by any Person means any obligation, contingent or
otherwise, of such Person directly or indirectly guaranteeing any Debt or other
obligation of any other Person and, without limiting the generality of the
foregoing, any obligation, direct or indirect, contingent or otherwise, of such
Person (i) to secure, purchase or pay (or advance or supply funds for the
purchase or payment of) such Debt or other obligation (whether arising by
virtue of partnership arrangements, by agreement to keep-well, to purchase
assets, goods, securities or services, to provide collateral security, to
take-or-pay, or to maintain financial statement conditions or otherwise) or
(ii)
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entered into for the purpose of assuring in any other manner the obligee of
such Debt or other obligation of the payment thereof or to protect such obligee
against loss in respect thereof (in whole or in part), provided that the term
Guarantee shall not include endorsements for collection or deposit in the
ordinary course of business. The term "Guarantee" used as a verb has a
corresponding meaning.
"Guarantors" means any one or more or all of the following, as the
context shall require: (i) Springs Window Fashions Division, Inc. and
Clark-Schwebel, Inc., each a Delaware corporation; and (ii) any Domestic
Subsidiary which elects to become a Guarantor pursuant to Section 5.22; in each
case subject to the provisions of the last sentence of Section 5.22.
"Guaranty" means the Guaranty Agreement of even date herewith in
substantially the form of Exhibit "I" to be executed by the Guarantors,
unconditionally and jointly and severally Guaranteeing payment of the Loans,
the Notes and all other obligations of the Borrower to the Agent and the Banks
hereunder, including without limitation all principal, interest, fees, costs,
and compensation and indemnification amounts.
"Hazardous Materials" includes, without limitation, (a) solid or
hazardous waste, as defined in the Resource Conservation and Recovery Act of
1980, 42 U.S.C. Section 6901 et seq. and its implementing regulations and
amendments, or in any applicable state or local law or regulation, (b)
"hazardous substance", "pollutant", or "contaminant" as defined in CERCLA, or
in any applicable state or local law or regulation, (c) gasoline, or any other
petroleum product or by-product, including, crude oil or any fraction thereof,
or (d) pesticides, as defined in the Federal Insecticide, Fungicide, and
Rodenticide Act of 1975, or in any applicable state or local law or regulation,
as each such Act, statute or regulation may be amended from time to time.
"Installment Payment Date" means, for each Term Loan Advance, each
Anniversary Date for such Term Loan Advance and each date which is three, six
and nine months after, and on the same day of the month as, each Anniversary
Date for such Term Loan Advance (or on the first Domestic Business Day
thereafter, if such day of the month is not a Domestic Business Day),
commencing on the first such date after the third such Anniversary Date.
"Interest Period" means: (1) with respect to each Euro-Dollar
Borrowing, the period commencing on the date of such Borrowing and ending on
the numerically corresponding day in the first, second, third or sixth month
thereafter, as the Borrower may elect in the applicable Notice of Borrowing;
provided that:
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(a) any Interest Period (subject to paragraph (c) below) which
would otherwise end on a day which is not a Euro-Dollar Business Day shall
be extended to the next succeeding Euro-Dollar Business Day unless such
Euro-Dollar Business Day falls in another calendar month, in which case
such Interest Period shall end on the next preceding Euro-Dollar Business
Day;
(b) any Interest Period which begins on the last Euro-Dollar
Business Day of a calendar month (or on a day for which there is no
numerically corresponding day in the appropriate subsequent calendar
month) shall, subject to paragraph (c) below, end on the last Euro-Dollar
Business Day of the appropriate subsequent calendar month; and
(c) no Interest Period may be selected which begins before the
Maturity Date and would otherwise end after the Maturity Date.
(2) with respect to each Base Rate Borrowing, the period commencing on the date
of such Borrowing and ending 30 days thereafter; provided that:
(a) any Interest Period (subject to paragraph (b) below) which
would otherwise end on a day which is not a Domestic Business Day shall be
extended to the next succeeding Domestic Business Day; and
(b) no Interest Period which begins before the Maturity Date and
would otherwise end after the Maturity Date may be selected.
"Investment" means any investment in any Person other than a
Subsidiary, whether by means of purchase or acquisition of obligations or
securities of such Person, capital contribution to such Person, loan or advance
to such Person, making of a time deposit with such Person, Guarantee or
assumption of any obligation of such Person or otherwise.
"Lending Office" means, as to each Bank, its office located at its
address set forth on the signature pages hereof (or identified on the signature
pages hereof as its Lending Office) or such other office as such Bank may
hereafter designate as its Lending Office by notice to the Borrower and the
Agent.
"Leverage Ratio" means the ratio of Consolidated Debt to EBITDA.
"Lien" means, with respect to any asset, any mortgage, deed to
secure debt, deed of trust, lien, pledge, charge,
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security interest, security title, preferential arrangement which has the
practical effect of constituting a security interest or encumbrance, or
encumbrance or servitude of any kind in respect of such asset to secure or
assure payment of a Debt or a Guarantee, whether by consensual agreement or by
operation of statute or other law, or by any agreement, contingent or
otherwise, to provide any of the foregoing. For the purposes of this
Agreement, the Borrower or any Subsidiary shall be deemed to own subject to a
Lien any asset which it has acquired or holds subject to the interest of a
vendor or lessor under any conditional sale agreement, capital lease or other
title retention agreement relating to such asset.
"Loan" means a Term Loan Advance, and also means a Base Rate Loan or
Euro-Dollar Loan, and "Loans" means the Term Loan Advances and the Term Loans,
and also means Base Rate Loans or Euro-Dollar Loans, or any one or more or all
of them, as the context shall require.
"Loan Documents" means this Agreement, the Notes, the Contribution
Agreement (insofar as it relates to the Borrower), any other document
evidencing, relating to or securing the Loans, and any other document or
instrument delivered from time to time in connection with this Agreement, the
Notes or the Loans, as such documents and instruments may be amended or
supplemented from time to time.
"London Interbank Offered Rate" has the meaning set forth in Section
2.05(c).
"Margin Stock" means "margin stock" as defined in Regulations G, T,
U or X.
"Material Adverse Effect" means, with respect to any event, act,
condition or occurrence of whatever nature (including any adverse
determination in any litigation, arbitration, or governmental investigation or
proceeding), whether singly or in conjunction with any other event or events,
act or acts, condition or conditions, occurrence or occurrences, whether or not
related, a material adverse change in, or a material adverse effect upon, any
of (a) the financial condition, operations, business, properties or prospects
of the Borrower and its Consolidated Subsidiaries taken as a whole, (b) the
rights and remedies of the Agent or the Banks under the Loan Documents, or the
ability of the Borrower to perform its obligations under the Loan Documents to
which it is a party, as applicable, or (c) the legality, validity or
enforceability of any Loan Document.
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"Maturity Date" means, for each Term Loan Advance, the Domestic
Business Day immediately preceding the tenth Anniversary Date for such Term
Loan Advance.
"Multiemployer Plan" shall have the meaning set forth in Section
4001(a)(3) of ERISA.
"Net Income" means, as applied to any Person for any period, the
aggregate amount of net income of such Person, after taxes, for such period, as
determined in accordance with GAAP.
"Net Proceeds of Capital Stock" means any proceeds received by the
Borrower or a Consolidated Subsidiary in respect of the issuance of Capital
Stock, after deducting therefrom all reasonable and customary costs and
expenses incurred by the Borrower or such Consolidated Subsidiary directly in
connection with the issuance of such Capital Stock.
"Notes" means the promissory notes of the Borrower, substantially in
the form of Exhibit A-1, evidencing the obligation of the Borrower to repay the
Loans, together with all amendments, consolidations, modifications, renewals
and supplements thereto.
"Notice of Borrowing" has the meaning set forth in Section 2.02.
"Operating Profits" means, as applied to any Person for any period,
the operating income of such Person for such period, as determined in
accordance with GAAP.
"Participant" has the meaning set forth in Section 9.08(b).
"PBGC" means the Pension Benefit Guaranty Corporation or any entity
succeeding to any or all of its functions under ERISA.
"Performance Pricing Determination Date" has the meaning set forth
in Section 2.05(a).
"Person" means an individual, a corporation, a partnership, an
unincorporated association, a trust or any other entity or organization,
including, but not limited to, a government or political subdivision or an
agency or instrumentality thereof.
"Plan" means at any time an employee pension benefit plan which is
covered by Title IV of ERISA or subject to the minimum funding standards under
Section 412 of the Code and is
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either (i) maintained by a member of the Controlled Group for employees of any
member of the Controlled Group or (ii) maintained pursuant to a collective
bargaining agreement or any other arrangement under which more than one
employer makes contributions and to which a member of the Controlled Group is
then making or accruing an obligation to make contributions or has within the
preceding 5 plan years made contributions.
"Prime Rate" refers to that interest rate so denominated and set by
Wachovia from time to time as an interest rate basis for borrowings. The Prime
Rate is but one of several interest rate bases used by Wachovia. Wachovia
lends at interest rates above and below the Prime Rate.
"Properties" means all real property owned, leased or otherwise used
or occupied by the Borrower or any Subsidiary, wherever located.
"Redeemable Preferred Stock" of any Person means any preferred stock
issued by such Person which is at any time prior to the Maturity Date either
(i) mandatorily redeemable (by sinking fund or similar payments or otherwise)
or (ii) redeemable at the option of the holder thereof.
"Refunding Loan" means a new Loan made on the day on which an
outstanding Loan is maturing or a Base Rate Borrowing is being converted to a
Euro-Dollar Borrowing.
"Regulation G" means Regulation G of the Board of Governors of the
Federal Reserve System, as in effect from time to time, together with all
official rulings and interpretations issued thereunder.
"Regulation T" means Regulation T of the Board of Governors of the
Federal Reserve System, as in effect from time to time, together with all
official rulings and interpretations issued thereunder.
"Regulation U" means Regulation U of the Board of Governors of the
Federal Reserve System, as in effect from time to time, together with all
official rulings and interpretations issued thereunder.
"Regulation X" means Regulation X of the Board of Governors of the
Federal Reserve System, as in effect from time to time, together with all
official rulings and interpretations issued thereunder.
"Required Banks" means at any time Banks having at least 66 2/3% of
the aggregate outstanding principal amount of
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the sum of the Loans, or if there are no Loans outstanding, of the Commitments.
"Restricted Payment" means (i) any Dividend on any shares of the
Borrower's Capital stock or (ii) any payment on account of the purchase,
redemption, retirement or acquisition of (a) any shares of the Borrower's
Capital Stock (except shares acquired upon the conversion thereof into other
shares of its Capital Stock) or (b) any option, warrant or other right to
acquire shares of the Borrower's Capital Stock.
"Stockholders' Equity" means, at any time, the shareholders' equity
of the Borrower and its Consolidated Subsidiaries, as set forth or reflected on
the most recent consolidated balance sheet of the Borrower and its Consolidated
Subsidiaries prepared in accordance with GAAP, but excluding any Redeemable
Preferred Stock of the Borrower or any of its Consolidated Subsidiaries.
Shareholders' equity generally would include, but not be limited to (i) the par
or stated value of all outstanding Capital Stock, (ii) capital surplus, (iii)
retained earnings, and (iv) various deductions such as (A) purchases of
treasury stock, (B) valuation allowances, (C) receivables due from an employee
stock ownership plan, (D) employee stock ownership plan debt guarantees, and
(E) translation adjustments for foreign currency transactions.
"Subsidiary" means any corporation or other entity of which
securities or other ownership interests having ordinary voting power to elect a
majority of the board of directors or other persons performing similar
functions are at the time directly or indirectly owned by the Borrower.
"Taxes" has the meaning set forth in Section 2.09(c).
"Term Loan" means the term loans to be made by each Bank hereunder
in the amount of its Commitment, which may consist of up to 3 Term Loan
Advances, and "Term Loans" means, collectively, the Term Loans of all of the
Banks.
"Term Loan Advance" means any initial advance of funds by the Banks
constituting part of the Term Loans, pursuant to Section 2.01.
"Third Parties" means all lessees, sublessees, licensees and other
users of the Properties, excluding those users of the Properties in the
ordinary course of the Borrower's business and on a temporary basis.
"Transferee" has the meaning set forth in Section 9.08(d).
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"Unfunded Vested Liabilities" means, with respect to any Plan at any
time, the amount (if any) by which (i) the present value of all vested
nonforfeitable benefits, determined on an accumulated benefit obligation basis,
under such Plan exceeds (ii) the fair market value of all Plan assets allocable
to such benefits, all determined as of the then most recent valuation date for
such Plan, but only to the extent that such excess represents a potential
liability of a member of the Controlled Group to the PBGC or the Plan under
Title IV of ERISA.
"Wachovia" means Wachovia Bank of North Carolina, N.A., a national
banking association, and its successors.
"Wholly Owned Subsidiary" means any Subsidiary all of the shares of
capital stock or other ownership interests of which (except directors'
qualifying shares) are at the time directly or indirectly owned by the
Borrower.
SECTION 1.02. Accounting Terms and Determinations. Unless otherwise
specified herein, all terms of an accounting character used herein shall be
interpreted, all accounting determinations hereunder shall be made, and all
financial statements required to be delivered hereunder shall be prepared, in
accordance with GAAP, applied on a basis consistent (except for changes
concurred in by the Borrower's independent public accountants or otherwise
required by a change in GAAP) with the most recent audited consolidated
financial statements of the Borrower and its Consolidated Subsidiaries
delivered to the Banks unless with respect to any such change concurred in by
the Borrower's independent public accountants or required by GAAP, in
determining compliance with any of the provisions of this Agreement or any of
the other Loan Documents: (i) the Borrower shall have objected to determining
such compliance on such basis at the time of delivery of such financial
statements, or (ii) the Required Banks shall so object in writing within 30
days after the delivery of such financial statements, in either of which events
such calculations shall be made on a basis consistent with those used in the
preparation of the latest financial statements as to which such objection shall
not have been made (which, if objection is made in respect of the first
financial statements delivered under Section 5.01 hereof, shall mean the
financial statements referred to in Section 4.04).
SECTION 1.03. References. Unless otherwise indicated, references in
this Agreement to "Articles", "Exhibits", "Schedules", "Sections" and other
Subdivisions are references to articles, exhibits, schedules, sections and
other subdivisions hereof.
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SECTION 1.04. Use of Defined Terms. All terms defined in this
Agreement shall have the same defined meanings when used in any of the other
Loan Documents, unless otherwise defined therein or unless the context shall
require otherwise.
SECTION 1.05. Terminology. All personal pronouns used in this
Agreement, whether used in the masculine, feminine or neuter gender, shall
include all other genders; the singular shall include the plural, and the
plural shall include the singular. Titles of Articles and Sections in this
Agreement are for convenience only, and neither limit nor amplify the
provisions of this Agreement.
ARTICLE II
THE CREDITS
SECTION 2.01. Commitments to Lend. Each Bank severally agrees, on
the terms and conditions set forth herein, upon not less than 3 Euro-Dollar
Business Days (or 2 Domestic Business Days, in the case of a Base Rate
Borrowing) prior written notice (which shall be irrevocable), to make up to 3
Term Loan Advances to the Borrower in an aggregate amount up to the amount of
the Commitment on a date specified in such notice (such date of any Term Loan
Advance being the "Drawdown Date" for such Term Loan Advance), which Drawdown
Date must be (i) a Euro-Dollar Business Day (or a Domestic Business Day, in the
case of a Base Rate Borrowing), and (ii) within 12 months of the Closing Date,
and thereafter to make Refunding Loans from time to time before the Maturity
Date. Upon the funding of 3 Term Loan Advances or a lesser number of Term Loan
Advances in an aggregate amount equal to the aggregate Commitments, whichever
is applicable, the Commitments shall terminate. The principal amount of each
Term Loan Advance shall be repaid in 27 consecutive quarterly installments,
each in an amount equal to 3.571428% of the original principal amount of such
Term Loan Advance, on each Installment Payment Date, with a final payment of
all outstanding principal and all accrued and unpaid interest on the Maturity
Date for such Term Loan Advance. Principal amounts repaid on Installment
Payment Dates may not be reborrowed, except as Refunding Loans. Each Refunding
Borrowing under this Section shall be in an aggregate principal amount of (i)
$2,500,000 or more, in the case of Euro-Dollar Loans, and (ii) 2,000,000 or
more, in the case of Base Rate Loans, and in each case shall be made from the
several Banks ratably in proportion to their respective Loans outstanding.
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SECTION 2.02. Method of Borrowing Loans. (a) If the Borrower
desires that any portion of the initial Term Loan Advance be made as
Euro-Dollar Loans on the Drawdown Date, the Borrower shall execute and deliver
to the Agent a Funding Indemnification Letter and the Banks and the Borrower
shall agree on the interest rates, amounts and Interest Periods with respect
thereto not later than 3 Euro-Dollar Business Days prior to the Drawdown Date
for such initial Term Loan Advance. If and to the extent that no Funding
Indemnification Letter has been so delivered or such agreement as to interest
rates, amounts and Interest Periods has not been reached within such time, the
funding of the initial Term Loan Advance, as well as all subsequent Term Loan
Advances and all Refunding Loans, shall be made as provided below. The
Borrower shall give the Agent notice (a "Notice of Borrowing"), which shall be
substantially in the form of Exhibit E, prior to 11:00 A.M. (Atlanta, Georgia
time) at least 1 Domestic Business Day before each Base Rate Borrowing and at
least 3 Euro-Dollar Business Days before each Euro-Dollar Borrowing,
specifying:
(i) the date of such Borrowing, which shall be a Domestic
Business Day in the case of a Base Rate Borrowing or a Euro-Dollar
Business Day in the case of a Euro-Dollar Borrowing,
(ii) the aggregate amount of such Borrowing,
(iii) whether the Loans comprising such Borrowing are to be Base
Rate Loans or Euro-Dollar Loans, and
(iv) in the case of a Euro-Dollar Borrowing, the duration of the
Interest Period applicable thereto, subject to the provisions of the
definition of Interest Period.
(b) Upon receipt of a Notice of Borrowing, the Agent shall
promptly notify each Bank of the contents thereof and of such Bank's ratable
share of such Borrowing and such Notice of Borrowing, once received by the
Agent, shall not thereafter be revocable by the Borrower.
(c) Not later than 11:00 A.M. (Atlanta, Georgia time) on the date
of each Borrowing, each Bank shall (except as provided in paragraph (d) of this
Section) (x) as to the initial funding of any Term Loan Advance on the Drawdown
Date for such Term Loan Advance, make available its ratable share of such
Borrowing, in Federal or other funds immediately available in Atlanta, Georgia,
to the Agent at its address determined pursuant to Section 9.01, and (y) as to
all Refunding Loans, make available (by and through the Agent) the amount of
the new Loan by setoff against the amount of the maturing Loan. Unless the
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Agent determines that any applicable condition specified in Article III has not
been satisfied, the Agent will make the funds so received from the Banks
available to the Borrower at the Agent's aforesaid address, or effect such
setoff, as applicable. Unless the Agent receives notice from a Bank, at the
Agent's address referred to in or specified pursuant to Section 9.01, no later
than 4:00 P.M. (local time at such address) on the Domestic Business Day before
the date of a Borrowing stating that such Bank will not make a Loan in
connection with such Borrowing, the Agent shall be entitled to assume that such
Bank will make a Loan in connection with such Borrowing and, in reliance on
such assumption, the Agent may (but shall not be obligated to) (A) as to the
initial funding of any Term Loan Advance on the Drawdown Date for such Term
Loan Advance, make available such Bank's ratable share of such Borrowing to the
Borrower for the account of such Bank, or (B) as to all Refunding Loans, effect
the setoff; provided, that the Agent may elect instead to have such funding
made available by Wachovia, and Wachovia hereby agrees to make such funding. If
the Agent or Wachovia makes such Bank's ratable share available to the Borrower
on the Drawdown Date and such Bank does not in fact make its ratable share of
such Borrowing available on such date, the Agent or Wachovia, as the case may
be, shall be entitled to recover such Bank's ratable share from such Bank,
together with interest thereon for each day during the period from the date of
such Borrowing until such sum shall be paid in full at a rate per annum equal
to the rate at which the Agent determines that it obtained (or could have
obtained) overnight Federal funds to cover such amount for each such day during
such period, provided that (i) any such payment by Wachovia of such Bank's
ratable share and interest thereon shall be without prejudice to any rights
that the Borrower may have against such Bank and (ii) until such Bank has paid
its ratable share of such Borrowing, together with interest pursuant to the
foregoing, it will have no interest in or rights with respect to such Borrowing
for any purpose hereunder (but Wachovia shall have such interest and rights, if
it has made such funding available).
(d) Notwithstanding anything to the contrary contained in this
Agreement, no Euro-Dollar Borrowing may be made if there shall have occurred a
Default or an Event of Default, which Default or Event of Default shall not
have been cured or waived.
(e) In the event that a Notice of Borrowing fails to specify
whether the Loans comprising such Borrowing are to be Base Rate Loans or
Euro-Dollar Loans, such Loans shall be made as Base Rate Loans. If the
Borrower is otherwise entitled under this Agreement to repay any Loans maturing
at the end of an Interest Period applicable thereto with the proceeds of a new
Borrowing, and the Borrower fails to repay such Loans using its
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own moneys and fails to give a Notice of Borrowing in connection with such new
Borrowing, a new Borrowing shall be deemed to be made on the date such Loans
mature in an amount equal to the principal amount of the Loans so maturing, and
the Loans comprising such new Borrowing shall be Base Rate Loans.
(f) Notwithstanding anything to the contrary contained herein,
there shall not be more than 6 interest rates (including the Applicable
Margins) applicable to the Loans at any time.
SECTION 2.03. Notes. (a) The Loans of each Bank shall be evidenced
by a single Note payable to the order of such Bank for the account of its
Lending Office in an amount equal to the original principal amount of such
Bank's Commitment.
(b) Upon receipt of each Bank's Notes pursuant to Section 3.01, the
Agent shall deliver such Notes to such Bank. Each Bank shall record, and prior
to any transfer of its Notes shall endorse on the schedules forming a part
thereof appropriate notations to evidence, each Term Loan Advance and the
Drawdown Date therefor, and the date, amount and maturity of, and effective
interest rate for, each Loan made by it, the date and amount of each payment of
principal made by the Borrower with respect thereto, and such schedules of each
such Bank's Notes shall constitute rebuttable presumptive evidence of the
respective principal amounts owing and unpaid on such Bank's Notes; provided
that the failure of any Bank to make any such recordation or endorsement shall
not affect the obligation of the Borrower hereunder or under the Notes or the
ability of any Bank to assign its Notes. Each Bank is hereby irrevocably
authorized by the Borrower so to endorse its Notes and to attach to and make a
part of any Note a continuation of any such schedule as and when required.
SECTION 2.04. Maturity of Loans. Each Loan included in any
Borrowing shall mature, and the principal amount thereof shall be due and
payable, on the last day of the Interest Period applicable to such Borrowing,
subject to the Borrower's right to obtain Refunding Loans pursuant hereto for
amounts not required to be paid on the Installment Payment Dates.
SECTION 2.05. Interest Rates. (a) "Applicable Margin" means:
(i) for the period from the Closing Date until the first Performance
Pricing Determination Date which occurs after the Closing Date, (x) for the
Base Rate 0.0%, and (y) for the Euro-Dollar Rate 0.3125%.
Page 42 of 87
<PAGE> 26
(ii) for the period from and after the first Performance Pricing
Determination Date which occurs after the Closing Date until but not including
the Fifth Closing Date Anniversary, for each type of Loan, the percentage
determined on each Performance Pricing Determination Date by reference to the
tables set forth below as to such type of Loan and the Leverage Ratio for the
quarterly or annual period ending immediately prior to such Performance Pricing
Determination Date:
<TABLE>
<CAPTION>
Leverage Ratio Base Rate Euro-Dollar Rate
-------------- --------- ----------------
<S> <C> <C>
Greater than 4.0 to 1.0 0.0% 0.625%
Greater than 3.50 to 1.0 but
less than or equal to
4.0 to 1.0 0.0% 0.5%
Less than or equal to
3.50 to 1.0 0.0% 0.3125%
</TABLE>
(iii) from and after the Fifth Closing Date Anniversary, for each type of
Loan, the percentage determined on each Performance Pricing Determination Date
(beginning with the first Performance Pricing Determination Date which occurs
after the Fifth Closing Date Anniversary) by reference to the tables set forth
below as to such type of Loan and the Leverage Ratio for the quarterly or
annual period ending immediately prior to such Performance Pricing
Determination Date:
<TABLE>
<CAPTION>
Leverage Ratio Base Rate Euro-Dollar Rate
-------------- --------- ----------------
<S> <C> <C>
Greater than 4.0 to 1.0 0.0% 0.75%
Greater than 3.50 to 1.0 but
less than or equal to
4.0 to 1.0 0.0% 0.625%
Less than or equal to
3.50 to 1.0 0.0% 0.4375%
</TABLE>
In determining interest for purposes of this Section 2.05, the Borrower
and the Banks shall refer to the Borrower's most recent consolidated quarterly
and annual (as the case may be) financial statements referred to in Section
4.04(a) or delivered pursuant to Section 5.01(a) or (b), as the case may be.
If such financial statements require a change in interest pursuant to this
Section 2.05, the Borrower shall deliver to the Agent, along with such
financial statements, a notice to that effect, which notice shall set forth in
reasonable detail the calculations establishing the required change.
The date of delivery of such financial statements and notice is the
"Performance Pricing Determination Date." Any such required change in interest
and fees shall become effective on
Page 43 of 87
<PAGE> 27
each Performance Pricing Determination Date which requires such change, except
that any change required on the first Performance Pricing Determination Date
which occurs after the Fifth Closing Date Anniversary shall become effective on
the Fifth Closing Date Anniversary (and if the Borrower has paid any interest
or fees during the period from the Fifth Closing Date Anniversary to the first
Performance Pricing Determination Date which occurs after the Fifth Closing
Date Anniversary, the Borrower shall pay to the Agent, for the account of the
Banks, as to interest, and for the account of the Agent, as to fees, an amount
equal to the difference in the interest or fees accrued through the last date
of such payment at such increased rate and the amount of interest or fees
actually paid on the last date of such payment), and any such change required
on any Performance Pricing Determination Date shall be in effect until the next
Performance Pricing Determination Date, provided that: (i) for Euro-Dollar
Loans, changes in interest shall only be effective for Interest Periods
commencing on or after the Performance Pricing Determination Date; and (ii) no
interest shall be decreased pursuant to this Section 2.05 if a Default is in
existence on the Performance Pricing Determination Date.
(b) Each Base Rate Loan shall bear interest on the outstanding
principal amount thereof, for each day from the date such Loan is made until it
becomes due, at a rate per annum equal to the Base Rate for such day plus the
Applicable Margin. Such interest shall be payable for each Interest Period on
the last day thereof. Any overdue principal of and, to the extent permitted by
applicable law, overdue interest on any Base Rate Loan shall bear interest,
payable on demand, for each day until paid at a rate per annum equal to the
Default Rate.
(c) Each Euro-Dollar Loan shall bear interest on the outstanding
principal amount thereof, for the Interest Period applicable thereto, at a rate
per annum equal to the sum of the Applicable Margin plus the applicable
Adjusted London Interbank Offered Rate for such Interest Period. Such interest
shall be payable for each Interest Period on the last day thereof and, if such
Interest Period is longer than 3 months, at intervals of 3 months after the
first day thereof. Any overdue principal of and, to the extent permitted by
law, overdue interest on any Euro-Dollar Loan shall bear interest, payable on
demand, for each day until paid at a rate per annum equal to the Default Rate.
The "Adjusted London Interbank Offered Rate" applicable to any
Interest Period means a rate per annum equal to the quotient obtained (rounded
upwards, if necessary, to the next higher 1/100th of 1%) by dividing (i) the
applicable London Interbank Offered Rate for such Interest Period by (ii) 1.00
minus the Euro-Dollar Reserve Percentage.
Page 44 of 87
<PAGE> 28
The "London Interbank Offered Rate" applicable to any Euro-Dollar
Loan means for the Interest Period of such Euro-Dollar Loan, the rate per annum
determined on the basis of the offered rate for deposits in Dollars of amounts
equal or comparable to the principal amount of such Euro-Dollar Loan offered
for a term comparable to such Interest Period, which rates appear on the
Reuters Screen LIBO Page as of 11:00 A.M., London time, 2 Euro-Dollar Business
Days prior to the first day of such Interest Period, provided that (i) if more
than one such offered rate appears on the Reuters Screen LIBO Page, the "London
Interbank Offered Rate" will be the arithmetic average (rounded upward, if
necessary, to the next higher 1/100th of 1%) of such offered rates; (ii) if no
such offered rates appear on such page, the "London Interbank Offered Rate" for
such Interest Period will be the arithmetic average (rounded upward, if
necessary, to the next higher 1/100th of 1%) of rates quoted by not less than 2
major banks in New York City, selected by the Agent, at approximately 10:00
A.M., New York City time, 2 Euro-Dollar Business Days prior to the first day of
such Interest Period, for deposits in Dollars offered to leading European banks
for a period comparable to such Interest Period in an amount comparable to the
principal amount of such Euro-Dollar Loan.
"Euro-Dollar Reserve Percentage" means for any day that percentage
(expressed as a decimal) which is in effect on such day, as prescribed by the
Board of Governors of the Federal Reserve System (or any successor) for
determining the maximum reserve requirement for a member bank of the Federal
Reserve System in respect of "Eurocurrency liabilities" (or in respect of any
other category of liabilities which includes deposits by reference to which the
interest rate on Euro-Dollar Loans is determined or any category of extensions
of credit or other assets which includes loans by a non-United States office of
any Bank to United States residents). The Adjusted London Interbank Offered
Rate shall be adjusted automatically on and as of the effective date of any
change in the Euro-Dollar Reserve Percentage.
(d) The Agent shall determine each interest rate applicable to
the Loans hereunder. The Agent shall give prompt notice to the Borrower and
the Banks by telecopier of each rate of interest so determined, and its
determination thereof shall be conclusive in the absence of manifest error.
(e) After the occurrence and during the continuance of a Default,
the principal amount of the Loans (and, to the extent permitted by applicable
law, all accrued interest thereon) may, at the election of the Required Banks,
bear interest at the Default Rate.
Page 45 of 87
<PAGE> 29
SECTION 2.06. Fees. (a) The Borrower shall pay to the Agent, for
the ratable account of each Bank, an upfront fee in the amount of 0.125% of the
aggregate Commitments, which fee shall be payable in full on the Closing Date.
(b) The Borrower shall pay to the Agent, for the account and sole
benefit of the Agent, such fees and other amounts at such times as set forth in
the Agent's Letter Agreement.
SECTION 2.07. Optional Prepayments. (a) The Borrower may, upon at
least (i) 1 Domestic Business Days' notice to the Agent, prepay any Base Rate
Borrowing, and (ii) 3 Euro-Dollar Business Days' notice to the Agent, prepay
any Euro-Dollar Borrowing, in each case in whole at any time or from time to
time in part (subject, however, to the provisions of paragraph (b) below as to
prepayments of Euro-Dollar Borrowings), in amounts aggregating at least
$5,000,000 or any larger multiple of $1,000,000 by paying the principal amount
to be prepaid together with accrued interest thereon to the date of prepayment.
Each such optional prepayment shall be applied (A) to prepay ratably the Base
Rate Loans of the several Banks included in such Base Rate Borrowing or the
Euro-Dollar Loans of the several Banks included in such Euro-Dollar Borrowing,
as applicable, and (B) to installments due on the Maturity Date and on
Installment Payment Dates in the inverse order of maturity, and such amounts
may not be reborrowed.
(b) The Borrower may prepay all or any portion of the principal
amount of any Euro-Dollar Loan prior to the maturity thereof, subject to the
payment of any compensation required by Section 8.05(a), if such payment is on
a date other than the last day of an Interest Period for such Euro-Dollar Loan.
(c) Upon receipt of a notice of prepayment pursuant to this
Section 2.07, the Agent shall promptly notify each Bank of the contents thereof
and of such Bank's ratable share of such prepayment and such notice, once
received by the Agent, shall not thereafter be revocable by the Borrower.
SECTION 2.08. Mandatory Prepayments. If (i) the Close Family
Interests shall own outstanding shares of the voting stock of the Borrower
having less than 51% of the voting power on all matters; or (ii) as of any date
a majority of the Board of Directors of the Borrower consists of individuals
who were not either (A) directors of the Borrower as of the corresponding date
of the previous year, (B) selected or nominated to become directors by the
Board of Directors of the Borrower of which a majority consisted of individuals
described in clause (A), or (C) selected or nominated to become directors by
the Board of
Page 46 of 87
<PAGE> 30
Directors of the Borrower of which a majority consisted of individuals
described in clause (A) and individuals described in clause (B);
then, in any such event, the Borrower shall prepay all outstanding principal
and accrued and unpaid interest and fees immediately following receipt of a
notice from the Agent (acting at the direction of the Required Banks) making
demand therefor.
SECTION 2.09. General Provisions as to Payments. (a) The Borrower
shall make each payment of principal of, and interest on, the Loans and of fees
hereunder, not later than 1:00 P.M. (Atlanta, Georgia time) on the date when
due, in Federal or other funds immediately available in Atlanta, Georgia, to
the Agent at its address referred to in Section 9.01. The Agent will promptly
distribute to each Bank its ratable share of each such payment received by the
Agent for the account of the Banks.
(b) Whenever any payment of principal of, or interest on, the
Base Rate Loans or of fees hereunder shall be due on a day which is not a
Domestic Business Day, the date for payment thereof shall be extended to the
next succeeding Domestic Business Day. Whenever any payment of principal of or
interest on, the Euro-Dollar Loans shall be due on a day which is not a
Euro-Dollar Business Day, the date for payment thereof shall be extended to the
next succeeding Euro-Dollar Business Day unless such Euro-Dollar Business Day
falls in another calendar month, in which case the date for payment thereof
shall be the next preceding Euro-Dollar Business Day.
(c) All payments of principal, interest and fees and all other
amounts to be made by the Borrower pursuant to this Agreement with respect to
any Loan or fee relating thereto shall be paid without deduction for, and free
from, any tax, imposts, levies, duties, deductions, or withholdings of any
nature now or at anytime hereafter imposed by any governmental authority or by
any taxing authority thereof or therein excluding in the case of each Bank,
taxes imposed on or measured by its net income, and franchise taxes imposed on
it, by the jurisdiction under the laws of which such Bank (as the case may be)
is organized or any political subdivision thereof and, in the case of each
Bank, taxes imposed on its income, and franchise taxes imposed on it, by the
jurisdiction of such Bank's applicable Lending Office or any political
subdivision thereof (all such non-excluded taxes, imposts, levies, duties,
deductions or withholdings of any nature being "Taxes"). In the event that the
Borrower is required by applicable law to make any such withholding or
deduction of Taxes with respect to any Loan or fee or other amount, the
Borrower shall pay such deduction or withholding to the applicable taxing
authority, shall promptly furnish to any Bank in respect of which
Page 47 of 87
<PAGE> 31
such deduction or withholding is made all receipts and other documents
evidencing such payment and shall pay to such Bank additional amounts as may be
necessary in order that the amount received by such Bank after the required
withholding or other payment shall equal the amount such Bank would have
received had no such withholding or other payment been made. If the Borrower
fails to provide such original or certified copy of a receipt evidencing
payment of Taxes, the Borrower hereby agrees to compensate such Bank for, and
indemnify them with respect to, the tax consequences of the Borrower's failure
to provide evidence of tax payments or tax exemption.
Each Bank which is not organized under the laws of the United
States or any state thereof agrees, as soon as practicable after receipt by it
of a request by the Borrower to do so, to file all appropriate forms and take
other appropriate action to obtain a certificate or other appropriate document
from the appropriate governmental authority in the jurisdiction imposing the
relevant Taxes, establishing that it is entitled to receive payments of
principal and interest under this Agreement and the Notes without deduction and
free from withholding of any Taxes imposed by such jurisdiction; provided that
if it is unable, for any reason, to establish such exemption, or to file such
forms and, in any event, during such period of time as such request for
exemption is pending, the Borrower shall nonetheless remain obligated under the
terms of the immediately preceding paragraph.
In the event any Bank receives a refund of any Taxes paid by the
Borrower pursuant to this Section 2.09(c), it will pay to the Borrower the
amount of such refund promptly upon receipt thereof; provided that if at any
time thereafter it is required to return such refund, the Borrower shall
promptly repay to it the amount of such refund.
Without prejudice to the survival of any other agreement of the
Borrower hereunder, the agreements and obligations of the Borrower and the
Banks contained in this Section 2.09(c) shall be applicable with respect to any
Participant, Assignee or other Transferee, and any calculations required by
such provisions (i) shall be made based upon the circumstances of such
Participant, Assignee or other Transferee, and (ii) constitute a continuing
agreement and shall survive the termination of this Agreement and the payment
in full or cancellation of the Notes.
SECTION 2.10. Computation of Interest and Fees. Interest on Base
Rate Loans based on the Base Rate shall be computed on the basis of a year of
360 days and paid for the actual number of days elapsed (including the first
day but excluding the last day). Interest on Base Rate Loans based on
Page 48 of 87
<PAGE> 32
Euro-Dollar Loans shall be computed on the basis of a year of 360 days and paid
for the actual number of days elapsed, calculated as to each Interest Period
from and including the first day thereof to but excluding the last day thereof.
Fees payable under the Agent's Letter Agreement shall be computed on the basis
of a year of 360 days and paid for the actual number of days elapsed (including
the first day but excluding the last day).
ARTICLE III
CONDITIONS TO CLOSING DATE AND BORROWINGS
SECTION 3.01. Conditions to Occurrence of Closing Date. The Closing
Date shall not occur until receipt by the Agent of the following (as to the
documents described in paragraphs (a),(c), (d) and (e) below, in sufficient
number of counterparts for delivery of a counterpart to each Bank and retention
of one counterpart by the Agent):
(a) from each of the parties hereto of either (i) a duly executed
counterpart of this Agreement signed by such party or (ii) a facsimile
transmission stating that such party has duly executed a counterpart of
this Agreement and sent such counterpart to the Agent;
(b) a duly executed Note;
(c) an opinion letter (together with any opinions of local
counsel relied on therein) of the General Counsel or Associate General
Counsel of the Borrower, dated as of the Closing Date, substantially in
the form of Exhibit B and covering such additional matters relating to the
transactions contemplated hereby as the Agent or any Bank may reasonably
request;
(d) an opinion of Jones, Day, Reavis & Pogue, special counsel for
the Agent, dated as of the Closing Date, substantially in the form of
Exhibit C and covering such additional matters relating to the
transactions contemplated hereby as the Agent may reasonably request;
(e) a certificate (the "Closing Certificate") substantially in
the form of Exhibit G), dated as of the Closing Date, signed by a
principal financial officer of the Borrower, to the effect that (i) no
Default has occurred and is continuing on the Closing Date and (ii) the
representations and warranties of the Borrower contained in Article IV are
true on and as of the Closing Date;
Page 49 of 87
<PAGE> 33
(f) all documents which the Agent or any Bank may reasonably
request relating to the existence of the Borrower and each Guarantor, the
corporate authority for and the validity of this Agreement, the Notes, the
Guaranty and the Contribution Agreement, and any other matters relevant
hereto, all in form and substance satisfactory to the Agent, including,
without limitation, a certificate of incumbency of the Borrower and each
Guarantor, signed by the Secretary or an Assistant Secretary of the
Borrower and each Guarantor, certifying as to the names, true signatures
and incumbency of the officer or officers of the Borrower or such
Guarantor authorized to execute and deliver the Loan Documents, or the
Guaranty and the Contribution Agreement, as applicable, and certified
copies of the following items: (i) the Borrower's and each Guarantor's
Certificate of Incorporation, (ii) the Borrower's and each Guarantor's
Bylaws, (iii) certificates of the Secretary of State of the State of
South Carolina as to the good standing of the Borrower and Catawba
Trucking Co., Inc. as South Carolina corporations, and of the Secretary of
State of Delaware as to the good standing of Springs Window Fashions
Division, Inc. and Clark-Schwebel, Inc. as Delaware corporations and (iv)
the action taken by the Board of Directors of the Borrower and each
Guarantor authorizing the Borrower's and each Guarantor's execution,
delivery and performance of this Agreement, the Notes and the other Loan
Documents to which the Borrower is a party, and of the Guaranty and the
Contribution Agreement by the Guarantors;
(g) the Guaranty and the Contribution Agreement, each duly
executed by each of the Guarantors; and
(h) receipt of all fees required to be paid on the Closing Date
pursuant to the Agent's Letter Agreement.
SECTION 3.02. Conditions to All Borrowings. The obligation of each
Bank to make a Loan on the occasion of each Borrowing is subject to the
satisfaction of the following conditions except as expressly provided in the
last sentence of this Section 3.02:
(a) receipt by the Agent of a Notice of Borrowing, unless all of
the funding of the initial Term Loan Advance on the Drawdown Date for such
Term Loan Advance is to consist of Euro-Dollars Borrowings, and a Funding
Indemnification Letter shall have been received, and the requirements of
the first sentence of Section 2.02(a) have been satisfied;
Page 50 of 87
<PAGE> 34
(b) the fact that, immediately before and after such Borrowing,
no Default shall have occurred and be continuing;
(c) the fact that the representations and warranties of the
Borrower contained in Article IV of this Agreement other than as set forth
in Section 4.04(b) shall be true on and as of the date of such Borrowing;
and
(d) the fact that, immediately after such Borrowing, the
conditions set forth in clauses (i) and (ii) of Section 2.01 shall have
been satisfied.
Each Borrowing hereunder shall be deemed to be a representation and warranty by
the Borrower on the date of such Borrowing as to the truth and accuracy of the
facts specified in paragraphs (b), (c) and (d) of this Section.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
The Borrower represents and warrants that:
SECTION 4.01. Corporate Existence and Power. The Borrower is a
corporation duly organized, validly existing and in good standing under the
laws of the jurisdiction of its incorporation, is duly qualified to transact
business in every jurisdiction where, by the nature of its business, such
qualification is necessary, except where such lack of qualification would not
have a Material Adverse Effect, and has all corporate powers and all
governmental licenses, authorizations, consents and approvals required to carry
on its business as now conducted.
SECTION 4.02. Corporate and Governmental Authorization; No
Contravention. The execution, delivery and performance by the Borrower of this
Agreement, the Notes and the other Loan Documents (i) are within the Borrower's
corporate powers, (ii) have been duly authorized by all necessary corporate
action, (iii) require no action by or in respect of or filing with, any
governmental body, agency or official, (iv) do not contravene, or constitute a
default under, any provision of applicable law or regulation or of the
certificate of incorporation or by-laws of the Borrower or of any agreement,
judgment, injunction, order, decree or other instrument binding upon the
Borrower or any of its Subsidiaries, and (v) do not result in the creation or
imposition of any Lien on any asset of the Borrower or any of its Subsidiaries.
Page 51 of 87
<PAGE> 35
SECTION 4.03. Binding Effect. This Agreement constitutes a valid
and binding agreement of the Borrower enforceable in accordance with its terms,
and the Notes and the other Loan Documents, when executed and delivered in
accordance with this Agreement, will constitute valid and binding obligations
of the Borrower enforceable in accordance with their respective terms, provided
that the enforceability hereof and thereof is subject in each case to general
principles of equity and to bankruptcy, insolvency and similar laws affecting
the enforcement of creditors' rights generally.
SECTION 4.04. Financial Information. (a) The consolidated balance
sheet of the Borrower and its Consolidated Subsidiaries as of January 1, 1994
and the related consolidated statements of income, shareholders' equity and
cash flows for the Fiscal Year then ended, reported on by Deloitte & Touche
LLP, copies of which have been delivered to each of the Banks, and the
unaudited consolidated financial statements of the Borrower for the interim
period ended October 1, 1994 copies of which have been delivered to each of the
Banks, fairly present, in conformity with GAAP, the consolidated financial
position of the Borrower and its Consolidated Subsidiaries as of such dates and
their consolidated results of operations and cash flows for such periods
stated.
(b) Since January 1, 1994, there has been no event, act,
condition or occurrence having a Material Adverse Effect.
SECTION 4.05. No Litigation. There is no action, suit or
proceeding pending, or to the knowledge of the Borrower threatened, against or
affecting the Borrower or any of its Subsidiaries before any court or
arbitrator or any governmental body, agency or official which could have a
Material Adverse Effect or which in any manner draws into question the
validity of or could impair the ability of the Borrower to perform its
obligations under, this Agreement, the Notes or any of the other Loan
Documents.
SECTION 4.06. Compliance with ERISA. (a) The Borrower and each
member of the Controlled Group have fulfilled their obligations under the
minimum funding standards of ERISA and the Code with respect to each Plan and
are in compliance in all material respects with the presently applicable
provisions of ERISA and the Code, and have not incurred any liability to the
PBGC or a Plan under Title IV of ERISA.
(b) Except as set forth in Schedule 4.06, neither the Borrower nor any
member of the Controlled Group has incurred any withdrawal liability with
respect to any Multiemployer Plan under Title IV of ERISA, and no such
liability is expected to be incurred.
Page 52 of 87
<PAGE> 36
SECTION 4.07. Compliance with Laws; Payment of Taxes. The Borrower
and its Subsidiaries are in compliance with all applicable laws, regulations
and similar requirements of governmental authorities, except where such
compliance is being contested in good faith through appropriate proceedings.
There have been filed on behalf of the Borrower and its Subsidiaries all
Federal, state and local income, excise, property and other tax returns which
are required to be filed by them and all taxes due pursuant to such returns or
pursuant to any assessment received by or on behalf of the Borrower or any
Subsidiary have been paid. The charges, accruals and reserves on the books of
the Borrower and its Subsidiaries in respect of taxes or other governmental
charges are, in the opinion of the Borrower, adequate. United States income
tax returns of the Borrower and its Subsidiaries have been examined and closed
through the Fiscal Year ended 1986.
SECTION 4.08. Subsidiaries. Each of the Borrower's Subsidiaries is
a corporation duly organized, validly existing and in good standing under the
laws of its jurisdiction of incorporation, is duly qualified to transact
business in every jurisdiction where, by the nature of its business, such
qualification is necessary, except where such lack of qualification would not
have a Material Adverse Effect, and has all corporate powers and all
governmental licenses, authorizations, consents and approvals required to carry
on its business as now conducted. The Borrower has no Subsidiaries except for
those Subsidiaries listed on Schedule 4.08, which accurately sets forth each
such Subsidiary's complete name and jurisdiction of incorporation.
SECTION 4.09. Investment Company Act. Neither the Borrower nor any
of its Subsidiaries is an "investment company" within the meaning of the
Investment Company Act of 1940, as amended.
SECTION 4.10. Public Utility Holding Company Act. Neither the
Borrower nor any of its Subsidiaries is a "holding company", or a "subsidiary
company" of a "holding company", or an "affiliate" of a "holding company" or of
a "subsidiary company" of a "holding company", as such terms are defined in the
Public Utility Holding Company Act of 1935, as amended.
SECTION 4.11. Ownership of Property; Liens. Each of the Borrower
and its Consolidated Subsidiaries has title to its properties sufficient for
the conduct of its business, and none of such property is subject to any Lien
except as permitted in Section 5.09.
Page 53 of 87
<PAGE> 37
SECTION 4.12. No Default. Neither the Borrower nor any of its
Consolidated Subsidiaries is in default under or with respect to any agreement,
instrument or undertaking to which it is a party or by which it or any of its
property is bound, which default could have or cause a Material Adverse Effect.
No Default or Event of Default has occurred and is continuing.
SECTION 4.13. Full Disclosure. All information heretofore
furnished by the Borrower to the Agent or any Bank for purposes of or in
connection with this Agreement or any transaction contemplated hereby is, and
all such information hereafter furnished by the Borrower to the Agent or any
Bank will be, true, accurate and complete in every material respect or based on
reasonable estimates on the date as of which such information is stated or
certified. The Borrower has disclosed to the Banks in writing any and all
facts which could have or cause a Material Adverse Effect.
SECTION 4.14. Environmental Matters. (a) Neither the Borrower nor
any Subsidiary is subject to any Environmental Liability which could have or
cause a Material Adverse Effect and, except as disclosed on Schedule 4.14,
neither the Borrower nor any Subsidiary has been designated as a potentially
responsible party under CERCLA or under any state statute similar to CERCLA.
Except as disclosed in Schedule 4.14, none of the Properties has been
identified on any current or proposed (i) National Priorities List under 40
C.F.R. Section 300, (ii) CERCLIS list or (iii) any list arising from a state
statute similar to CERCLA.
(b) No Hazardous Materials have been or are being used, produced,
manufactured, processed, treated, recycled, generated, stored, disposed of,
managed or otherwise handled at, or shipped or transported to or from the
Properties or are otherwise present at, on, in or under the Properties, or, to
the best of the knowledge of the Borrower, at or from any adjacent site or
facility, except for Hazardous Materials used, produced, manufactured,
processed, treated, recycled, generated, stored, disposed of, managed, or
otherwise handled in the ordinary course of business in compliance with all
applicable Environmental Requirements.
(c) The Borrower, and each of its Subsidiaries and Affiliates,
has procured all Environmental Authorizations necessary for the conduct of its
business, and is in compliance with all Environmental Requirements in
connection with the operation of the Properties and the Borrower's, and each of
its Subsidiary's and Affiliate's, respective businesses.
SECTION 4.15. Capital Stock. All Capital Stock, debentures, bonds,
notes and all other securities of the Borrower
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<PAGE> 38
and its Subsidiaries presently issued and outstanding are validly and properly
issued in accordance with all applicable laws, including, but not limited to,
the "Blue Sky" laws of all applicable states and the federal securities laws.
The issued shares of Capital Stock of the Borrower's Wholly Owned Subsidiaries
are owned by the Borrower free and clear of any Lien or adverse claim. At
least a majority of the issued shares of capital stock of each of the
Borrower's other Subsidiaries (other than Wholly Owned Subsidiaries) is owned
by the Borrower free and clear of any Lien or adverse claim.
SECTION 4.16. Margin Stock. Neither the Borrower nor any of its
Subsidiaries is engaged principally, or as one of its important activities, in
the business of purchasing or carrying any Margin Stock, and no part of the
proceeds of any Loan will be used to purchase or carry any Margin Stock or to
extend credit to others for the purpose of purchasing or carrying any Margin
Stock, or be used for any purpose which violates, or which is inconsistent
with, the provisions of Regulation X.
SECTION 4.17. Insolvency. After giving effect to the execution and
delivery of the Loan Documents and the making of the Loans under this
Agreement: (i) the Borrower will not (x) be "insolvent," within the meaning of
such term as used in O.C.G.A. Section 18-2-22 or as defined in Section 101 of
the "Bankruptcy Code", or Section 2 of either the "UFTA" or the "UFCA", or as
defined or used in any "Other Applicable Law" (as those terms are defined
below), or (y) be unable to pay its debts generally as such debts become due
within the meaning of Section 548 of the Bankruptcy Code, Section 4 of the UFTA
or Section 6 of the UFCA, or (z) have an unreasonably small capital to engage
in any business or transaction, whether current or contemplated, within the
meaning of Section 548 of the Bankruptcy Code, Section 4 of the UFTA or Section
5 of the UFCA; and (ii) the obligations of the Borrower under the Loan
Documents and with respect to the Loans will not be rendered avoidable under
any Other Applicable Law. For purposes of this Section 4.17, "Bankruptcy Code"
means Title 11 of the United States Code, "UFTA" means the Uniform Fraudulent
Transfer Act, "UFCA" means the Uniform Fraudulent Conveyance Act, and "Other
Applicable Law" means any other applicable state law pertaining to fraudulent
transfers or acts voidable by creditors, in each case as such law may be
amended from time to time.
SECTION 4.18. Insurance. The Borrower and each of its Subsidiaries
has (either in the name of the Borrower or in such Subsidiary's own name), with
financially sound and reputable insurance companies, insurance on all its
property in at least such amounts and against at least such risks as are
usually insured against in the same general area by companies of established
repute engaged in the same or similar business.
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ARTICLE V
COVENANTS
The Borrower agrees that, so long as any Bank has any Loan
outstanding hereunder or any amount payable hereunder or under any Note remains
unpaid:
SECTION 5.01. Information. The Borrower will deliver to each of
the Banks:
(a) as soon as available and in any event within 90 days after
the end of each Fiscal Year, a consolidated balance sheet of the Borrower
and its Consolidated Subsidiaries as of the end of such Fiscal Year and
the related consolidated statements of income, shareholders' equity and
cash flows for such Fiscal Year, setting forth in each case in comparative
form the figures for the previous fiscal year, all certified by Deloitte &
Touche LLP or other independent public accountants of nationally
recognized standing, with such certification to be free of exceptions and
qualifications not acceptable to the Required Banks;
(b) as soon as available and in any event within 45 days after
the end of each of the first 3 Fiscal Quarters of each Fiscal Year, a
consolidated balance sheet of the Borrower and its Consolidated
Subsidiaries as of the end of such Fiscal Quarter and the related
statement of income and statement of cash flows as of such Fiscal Quarter,
setting forth in each case in comparative form the figures for the
corresponding Fiscal Quarter and the corresponding portion of the previous
Fiscal Year, all certified (subject to normal year-end adjustments) as to
fairness of presentation, GAAP and consistency by the chief financial
officer or the chief accounting officer of the Borrower;
(c) simultaneously with the delivery of each set of financial
statements referred to in paragraphs (a) and (b) above, a certificate,
substantially in the form of Exhibit F (a "Compliance Certificate"), of
the chief financial officer or the chief accounting officer of the
Borrower (i) setting forth in reasonable detail the calculations required
to establish whether the Borrower was in compliance with the requirements
of Sections 5.03 through 5.07, inclusive, and 5.09 on the date of such
financial statements and (ii) stating whether any Default exists on the
date of such certificate and, if any Default then exists, setting forth
the details thereof and the action which the Borrower is taking or
proposes to take with respect thereto;
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(d) simultaneously with the delivery of each set of annual
financial statements referred to in paragraph (a) above, a statement of
the firm of independent public accountants which reported on such
statements to the effect that nothing has come to their attention to cause
them to believe that any Default existed on the date of such financial
statements;
(e) within 5 Domestic Business Days after the Borrower becomes
aware of the occurrence of any Default, a certificate of the chief
financial officer or the chief accounting officer of the Borrower setting
forth the details thereof and the action which the Borrower is taking or
proposes to take with respect thereto;
(f) promptly upon the mailing thereof to the shareholders of the
Borrower generally, copies of all financial statements, reports and proxy
statements so mailed;
(g) promptly upon the filing thereof, copies of all registration
statements (other than the exhibits thereto and any registration
statements on Form S-8 or its equivalent) and annual, quarterly or monthly
reports which the Borrower shall have filed with the Securities and
Exchange Commission;
(h) if and when any member of the Controlled Group (i) gives or
is required to give notice to the PBGC of any "reportable event" (as
defined in Section 4043 of ERISA) with respect to any Plan which might
constitute grounds for a termination of such Plan under Title IV of ERISA,
or knows that the plan administrator of any Plan has given or is required
to give notice of any such reportable event, a copy of the notice of such
reportable event given or required to be given to the PBGC; (ii) receives
notice of complete or partial withdrawal liability under Title IV of
ERISA, a copy of such notice; or (iii) receives notice from the PBGC under
Title IV of ERISA of an intent to terminate or appoint a trustee to
administer any Plan, a copy of such notice; and
(i) from time to time such additional information regarding the
financial position or business of the Borrower and its Subsidiaries as the
Agent, at the request of any Bank, may reasonably request.
SECTION 5.02. Inspection of Property, Books and Records. The
Borrower will (i) keep, and cause each Subsidiary to keep, proper books of
record and account in which full, true and correct entries in conformity with
GAAP shall be made of all
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dealings and transactions in relation to its business and activities; and (ii)
permit, and cause each Subsidiary to permit, at reasonable times and on
reasonable notice, representatives of any Bank at such Bank's expense prior to
the occurrence of a Default and at the Borrower's expense after the occurrence
of a Default to visit and inspect any of their respective properties, to
examine and make abstracts from any of their respective books and records and
to discuss their respective affairs, finances and accounts with their
respective officers, employees and independent public accountants. The
Borrower agrees to cooperate and assist in such visits and inspections, in each
case at such reasonable times and as often as may reasonably be desired.
SECTION 5.03. Leverage Ratio. The Leverage Ratio will not at any
time exceed 4.5 to 1.00, calculated at the end of each Fiscal Quarter.
SECTION 5.04. Ratio of Consolidated Debt to Consolidated Total
Tangible Capital. The ratio of Consolidated Debt to Consolidated Total
Tangible Capital will not at any time exceed 0.5 to 1.00, calculated at the end
of each Fiscal Quarter.
SECTION 5.05. Minimum Consolidated Tangible Net Worth.
Consolidated Tangible Net Worth will at no time be less than $475,000,000, plus
the sum of (i) 25% of the cumulative Consolidated Net Income of the Borrower
and its Consolidated Subsidiaries for the period from the Closing Date through
and including the last Fiscal Quarter just ended (taken as one accounting
period), calculated quarterly but excluding from such calculations of
Consolidated Net Income for purposes of this clause (i), any quarter in which
the Consolidated Net Income of the Borrower and its Consolidated Subsidiaries
is negative, (ii) 100% of the cumulative Net Proceeds of Capital Stock received
during any period after the Closing Date, less the amount of any Capital Stock
repurchased by the Borrower during any period after the Closing Date and (iii)
100% of the amount of any Debt converted to equity in the Borrower during any
period after the Closing Date, calculated quarterly.
SECTION 5.06. Restricted Payments. The Borrower will not declare
or make any Restricted Payment during any Fiscal Year except from Consolidated
Net Income Available for Restricted Payments; provided that after giving effect
to the payment of any such Restricted Payments, the Borrower will be in full
compliance with all of the provisions of this Agreement.
SECTION 5.07. Loans or Advances. Neither the Borrower nor any of
its Subsidiaries shall make loans or advances to any Person except: (i) loans
or advances to employees not exceeding $1,500,000 in the aggregate principal
amount outstanding at any
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time, in each case made in the ordinary course of business and consistent with
practices existing on the Closing Date; and (ii) deposits required by
government agencies or public utilities; (iii) loans and advances not in excess
of an aggregate amount of $10,000,000 consisting of trade accounts receivable,
the payment terms of which have been altered by virtue of the bankruptcy of the
account debtor; (iv) loans and advances (a) from the Borrower to any Guarantor
(b) from any Guarantor to any other Guarantor or (c) from any Subsidiary to the
Borrower; (v) loans and advances from the Borrower to any Foreign Subsidiary
not exceeding at any time an amount which, together with the aggregate amount
of Investments in Foreign Subsidiaries permitted by clause (C) of Section 5.08,
is equal to 15% of Consolidated Tangible Net Worth at such time; and (vi) other
loans and advances, not exceeding at any time an amount which, together with
the aggregate amounts of Investments permitted by clause (D) of Section 5.08,
is equal to 10% of Consolidated Tangible Net Worth at such time; provided that
after giving effect to the making of any loans, advances or deposits permitted
by this Section, the Borrower will be in full compliance with all the
provisions of this Agreement.
SECTION 5.08. Investments. Except for the existing Investments
listed on Schedule 5.08, neither the Borrower nor any of its Subsidiaries shall
make Investments in any Person except as permitted by Section 5.07 and except
(A) Investments in (i) direct obligations of the United States Government
maturing within one year, (ii) certificates of deposit issued by a commercial
bank whose credit is satisfactory to the Agent, (iii) commercial paper rated A1
or the equivalent thereof by Standard & Poor's Corporation or P1 or the
equivalent thereof by Moody's Investors Service, Inc. and in either case
maturing within 6 months after the date of acquisition, (iv) tender bonds the
payment of the principal of and interest on which is fully supported by a
letter of credit issued by a United States bank whose long-term certificates
of deposit are rated at least AA or the equivalent thereof by Standard & Poor's
Corporation and Aa or the equivalent thereof by Moody's Investors Service, Inc.
and/or (v) other short term Investments in accordance with company policy of
the Borrower in effect as of the date of this Agreement, a written copy of
which has been provided to the Banks, which policy may not be changed without
the Required Banks' prior written consent, (B) Investments by the Borrower in a
Guarantor or by any Guarantor in another Guarantor, (C) Investments by the
Borrower in Foreign Subsidiaries not exceeding at any time an amount which,
together with loans and advances to Foreign Subsidiaries permitted by clause
(v) of Section 5.07, is equal to 15% of Consolidated Tangible Net Worth at such
time; and (D) other Investments not exceeding at any time an amount which,
together with the aggregate amounts of loans and advances
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permitted by clause (vi) of Section 5.07, is equal to 10% of Consolidated
Tangible Net Worth at such time.
SECTION 5.09. Negative Pledge. Neither the Borrower nor any
Consolidated Subsidiary will create, assume or suffer to exist any Lien on any
asset now owned or hereafter acquired by it, except:
(a) Liens existing on the date of this Agreement securing Debt
outstanding on the date of this Agreement in an aggregate principal amount
not exceeding $30,000,000;
(b) any Lien existing on any asset of any corporation at the time
such corporation becomes a Consolidated Subsidiary and not created in
contemplation of such event;
(c) any Lien on any asset securing Debt incurred or assumed for
the purpose of financing all or any part of the cost of acquiring or
constructing such asset, provided that such Lien attaches to such asset
concurrently with or within 18 months after the acquisition or completion
of construction thereof;
(d) any Lien on any asset of any corporation existing at the time
such corporation is merged or consolidated with or into the Borrower or a
Consolidated Subsidiary and not created in contemplation of such event;
(e) any Lien existing on any asset prior to the acquisition
thereof by the Borrower or a Consolidated Subsidiary and not created in
contemplation of such acquisition;
(f) Liens securing Debt owing by any Subsidiary to the Borrower;
(g) any Lien arising out of the refinancing, extension, renewal
or refunding of any Debt secured by any Lien permitted by any of the
foregoing paragraphs of this Section, provided that (i) such Debt is not
secured by any additional assets, and (ii) the amount of such Debt secured
by any such Lien is not increased;
(h) Liens incidental to the conduct of its business or the
ownership of its assets which (i) do not secure Debt and (ii) do not in
the aggregate materially detract from the value of its assets or
materially impair the use thereof in the operation of its business;
(i) any Lien on Margin Stock; and
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(j) Liens not otherwise permitted by the foregoing paragraphs of
this Section securing Debt (other than indebtedness represented by the
Notes) in an aggregate principal amount at any time outstanding not to
exceed 10% of Consolidated Tangible Net Worth.
Provided Liens permitted by the foregoing paragraphs (a) through (j) shall at
no time secure Debt in an aggregate amount greater than 15% of Consolidated
Tangible Net Worth.
SECTION 5.10. Maintenance of Existence. The Borrower shall, and
shall cause each Subsidiary to, maintain its corporate existence and carry on
its business in substantially the same manner and in substantially the same
fields as such business is now carried on and maintained.
SECTION 5.11. Dissolution. Neither the Borrower nor any of its
Subsidiaries shall suffer or permit dissolution or liquidation either in whole
or in part, except through corporate reorganization to the extent permitted by
Section 5.12, and except for Subsidiaries which are shown on Schedule 4.08 as
being inactive.
SECTION 5.12. Consolidations, Mergers and Sales of Assets. The
Borrower will not, nor will it permit any Subsidiary to, consolidate or merge
with or into, or sell, lease or otherwise transfer all or any substantial part
of its assets to, any other Person, or discontinue or eliminate any business
line or segment, provided that (a) the Borrower may merge with another Person
if (i) such Person was organized under the laws of the United States of America
or one of its states, (ii) the Borrower is the corporation surviving such
merger and (iii) immediately after giving effect to such merger, no Default
shall have occurred and be continuing, (b) Subsidiaries of the Borrower may
merge with one another, and (c) the foregoing limitation on the sale, lease or
other transfer of assets and on the discontinuation or elimination of a
business line or segment shall not prohibit, during any Fiscal Year, a transfer
of assets or the discontinuance or elimination of a business line or segment
(in a single transaction or in a series of related transactions) unless the
aggregate assets to be so transferred or utilized in a business line or segment
to be so discontinued, when combined with all other assets transferred, and all
other assets utilized in all other business lines or segments discontinued,
during such Fiscal Year constituted more than 10% of Consolidated Tangible Net
Worth.
SECTION 5.13. Use of Proceeds. No portion of the proceeds of the
Loans will be used by the Borrower or any Subsidiary (i) in connection with,
whether directly or
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indirectly, any tender offer for, or other acquisition of, stock of any
corporation with a view towards obtaining control of such other corporation,
unless such tender offer or other acquisition is to be made on a negotiated
basis with the approval of the Board of Directors of the Person to be acquired
(ii) directly or indirectly, for the purpose, whether immediate, incidental or
ultimate, of purchasing or carrying any Margin Stock, or (iii) for any purpose
in violation of any applicable law or regulation.
SECTION 5.14. Compliance with Laws; Payment of Taxes. (a) The
Borrower will, and will cause each of its Subsidiaries and each member of the
Controlled Group to, comply with applicable laws (including but not limited to
ERISA), regulations and similar requirements of governmental authorities
(including but not limited to PBGC), except where the necessity of such
compliance is being contested in good faith through appropriate proceedings.
The Borrower will, and will cause each of its Subsidiaries to, pay promptly
when due all taxes, assessments, governmental charges, claims for labor,
supplies, rent and other obligations which, if unpaid, might become a lien
against the property of the Borrower or any Subsidiary, except liabilities
being contested in good faith and against which, if requested by the Agent, the
Borrower will set up reserves in accordance with GAAP.
(b) The Borrower (i) shall not permit the aggregate complete or
partial withdrawal liability under Title IV of ERISA with respect to
Multiemployer Plans incurred by the Borrower and members of the Controlled
Group to exceed $3,000,000 at any time, and (ii) shall notify the Agent and the
Banks in writing, within 90 days after the end of each Fiscal Year, of the
aggregate amount of such liability, if it exceeds $1,000,000. For purposes of
this Section 5.14(b), the amount of withdrawal liability of the Borrower and
members of the Controlled Group at any date shall be the aggregate present
value of the amount claimed to have been incurred less any portion thereof
which the Borrower and members of the Controlled Group have paid or as to which
the Borrower reasonably believes, after appropriate consideration of possible
adjustments arising under Sections 4219 and 4221 of ERISA, it and members of
the Controlled Group will have no liability, provided that the Borrower shall
obtain prompt written advice from independent actuarial consultants supporting
such determination.
SECTION 5.15. Insurance. The Borrower will maintain, and will
cause each of its Subsidiaries to maintain (either in the name of the Borrower
or in such Subsidiary's own name), with financially sound and reputable
insurance companies, insurance on all its property in at least such amounts
and against at least such risks as are usually insured against in the same
general
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area by companies of established repute engaged in the same or similar
business.
SECTION 5.16. Change in Fiscal Year. The Borrower will not change
its Fiscal Year without the consent of the Required Banks.
SECTION 5.17. Maintenance of Property. The Borrower shall, and
shall cause each Subsidiary to, maintain all of its properties and assets
reasonably required for the conduct of its business in good condition, repair
and working order, ordinary wear and tear excepted.
SECTION 5.18. Environmental Notices. The Borrower shall furnish to
the Banks and the Agent prompt written notice of all material Environmental
Liabilities, pending, threatened or anticipated Environmental Proceedings,
Environmental Notices, Environmental Judgments and Orders, and Environmental
Releases at, on, in, under or in any way affecting the Properties or any
adjacent property, and all facts, events, or conditions that could lead to any
of the foregoing.
SECTION 5.19. Environmental Matters. The Borrower and its
Subsidiaries will not, and will not permit any Third Party to, use, produce,
manufacture, process, treat, recycle, generate, store, dispose of, manage at,
or otherwise handle, or ship or transport to or from the Properties any
Hazardous Materials except for Hazardous Materials used, produced,
manufactured, processed, treated, recycled, generated, stored, disposed,
managed, or otherwise handled in the ordinary course of business in compliance
with all applicable Environmental Requirements.
SECTION 5.20. Environmental Release. The Borrower agrees that upon
the occurrence of a non-permitted Environmental Release at or on any of the
Properties it will act immediately to investigate the extent of, and to take
appropriate remedial action to eliminate, such Environmental Release, whether
or not ordered or otherwise directed to do so by any Environmental Authority.
SECTION 5.21. Transactions with Affiliates. Neither the Borrower
nor any of its Subsidiaries shall enter into, or be a party to, any transaction
with any Affiliate of the Borrower or such Subsidiary (which Affiliate is not
the Borrower or a Wholly Owned Subsidiary), except as permitted by law and in
the ordinary course of business and pursuant to reasonable terms which are
fully disclosed to the Agent and the Banks, and are no less favorable to
Borrower or such Subsidiary than would be obtained in a comparable arm's length
transaction with a Person which is not an Affiliate.
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SECTION 5.22. Election to Become Guarantors; Release of Guarantors
to be Sold. (a) Any Domestic Subsidiary (whether existing on the Closing Date
or acquired or created thereafter) which is not a Guarantor may elect to become
a Guarantor at any time by (x) executing and delivering to the Agent a
counterpart of the Guaranty and a counterpart of the Contribution Agreement,
thereby becoming a party to each of them, (y) delivering to the Agent an
opinion of counsel to such Subsidiary substantially in the form of Exhibit B,
but limited to such Domestic Subsidiary, and excluding paragraph 2 thereof, and
(z) delivering to the Agent documents pertaining to such Domestic Subsidiary
reasonably requested by the Agent of the types described in paragraph (f) of
Section 3.01.
(b) In the case of any Guarantor the stock of which is to be sold, such
Guarantor may submit to the Agent a request for a release of its obligations
under the Guaranty, and such Guarantor shall be entitled to obtain from the
Agent a written release from the Guaranty, provided that it can demonstrate to
the reasonable satisfaction of the Agent that (A) the provisions of Section
5.12 will not be breached by such sale, (b) all loans to such Guarantor from
the Borrower or any other Guarantor have been repaid in full, (C) the net
purchase price to be realized by the seller of such Guarantor for such sale
will be not less than 100% of the net book value of such seller's Investment in
such Guarantor, and (D) no Event of Default is in existence or will be caused
as a result of such sale, and upon obtaining such written release, it shall no
longer be a Guarantor for any purpose hereunder or under the Guaranty.
ARTICLE VI
DEFAULTS
SECTION 6.01. Events of Default. If one or more of the following
events ("Events of Default") shall have occurred and be continuing:
(a) the Borrower shall fail to pay when due any principal of any
Loan or shall fail to pay any interest on any Loan within 5 Domestic
Business Days after such interest shall become due, or shall fail to pay
any fee or other amount payable hereunder within 5 Domestic Business Days
after such fee or other amount becomes due; or
(b) the Borrower shall fail to observe or perform any covenant
contained in Sections 5.01(e), 5.02(ii), 5.03 to 5.13, inclusive, Sections
5.16 or 5.21; or
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(c) the Borrower shall fail to observe or perform any covenant or
agreement contained or incorporated by reference in this Agreement (other
than those covered by paragraph (a) or (b) above) and such failure shall
not have been cured within 30 days after the earlier to occur of (i)
written notice thereof has been given to the Borrower by the Agent at the
request of any Bank or (ii) the Borrower otherwise becomes aware of any
such failure; or
(d) any representation, warranty, certification or statement made
by the Borrower in Article IV of this Agreement or in any certificate,
financial statement or other document delivered pursuant to this Agreement
shall prove to have been incorrect or misleading in any material respect
when made (or deemed made); or
(e) the Borrower or any Subsidiary shall fail to make any payment
in respect of Debt outstanding (other than the Notes) when due or within
any applicable grace period; or
(f) any event or condition shall occur which results in the
acceleration of the maturity of Debt outstanding of the Borrower or any
Subsidiary (including, without limitation, any required mandatory
prepayment or "put" of such Debt to the Borrower or any Subsidiary) or
enables (or, with the giving of notice or lapse of time or both, would
enable) the holders of such Debt or commitment or any Person acting on
such holders' behalf to accelerate the maturity thereof or terminate any
such commitment (including, without limitation, any required mandatory
prepayment or "put" of such Debt to the Borrower or any Subsidiary); or
(g) the Borrower or any Subsidiary shall commence a voluntary
case or other proceeding seeking liquidation, reorganization or other
relief with respect to itself or its debts under any bankruptcy,
insolvency or other similar law now or hereafter in effect or seeking the
appointment of a trustee, receiver, liquidator, custodian or other similar
official of it or any substantial part of its property, or shall consent
to any such relief or to the appointment of or taking possession by any
such official in an involuntary case or other proceeding commenced against
it, or shall make a general assignment for the benefit of creditors, or
shall fail generally to pay its debts as they become due, or shall take
any corporate action to authorize any of the foregoing; or
(h) an involuntary case or other proceeding shall be commenced
against the Borrower or any Subsidiary seeking liquidation, reorganization
or other relief with respect to
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it or its debts under any bankruptcy, insolvency or other similar law now
or hereafter in effect or seeking the appointment of a trustee, receiver,
liquidator, custodian or other similar official of it or any substantial
part of its property, and such involuntary case or other proceeding shall
remain undismissed and unstayed for a period of 60 days; or an order for
relief shall be entered against the Borrower or any Subsidiary under the
federal bankruptcy laws as now or hereafter in effect; or
(i) the Borrower or any member of the Controlled Group shall fail
to pay when due any material amount which it shall have become liable to
pay to the PBGC or to a Plan under Title IV of ERISA; or notice of intent
to terminate a Plan or Plans shall be filed under Title IV of ERISA by the
Borrower, any member of the Controlled Group, any plan administrator or
any combination of the foregoing, if the Plan or Plans have unfunded
liabilities, calculated on a termination basis, in excess of $3,000,000;
or the PBGC shall institute proceedings under Title IV of ERISA to
terminate or to cause a trustee to be appointed to administer any such
Plan or Plans or a proceeding shall be instituted by a fiduciary of any
such Plan or Plans to enforce Section 515 or 4219(c)(5) of ERISA and such
proceeding shall not have been dismissed within 30 days thereafter; or a
condition shall exist by reason of which the PBGC would be entitled to
obtain a decree adjudicating that any such Plan or Plans must be
terminated; or
(j) one or more judgments or orders for the payment of money in
an aggregate amount in excess of $3,000,000 shall be rendered against the
Borrower or any Subsidiary and such judgment or order shall continue
unsatisfied and unstayed for a period of 30 days; or
(k) a federal tax lien shall be filed against the Borrower or any
Subsidiary under Section 6323 of the Code or a lien of the PBGC shall be
filed against the Borrower or any Subsidiary under Section 4068 of ERISA
and in either case such lien shall remain undischarged for a period of 25
days after the date of filing;
then, and in every such event, the Agent shall if requested by the Required
Banks, by notice to the Borrower declare the Notes (together with accrued
interest thereon) to be, and the Notes shall thereupon become, immediately due
and payable without presentment, demand, protest or other notice of any kind,
all of which are hereby waived by the Borrower together with interest at the
Default Rate accruing on the principal amount thereof from
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and after the date of such Event of Default; provided that if any Event of
Default specified in paragraph (g) or (h) above occurs with respect to the
Borrower, without any notice to the Borrower or any other act by the Agent or
the Banks, the Commitments shall thereupon terminate and the Notes (together
with accrued interest thereon) shall become immediately due and payable
without presentment, demand, protest or other notice of any kind, all of which
are hereby waived by the Borrower together with interest thereon at the Default
Rate accruing on the principal amount thereof from and after the date of such
Event of Default. Notwithstanding the foregoing, the Agent shall have
available to it all other remedies at law or equity, and shall exercise any one
or all of them at the request of the Required Banks.
SECTION 6.02. Notice of Default. The Agent shall give notice to
the Borrower of any Default under Section 6.01(c) promptly upon being requested
to do so by any Bank and shall thereupon notify all the Banks thereof.
ARTICLE VII
THE AGENT
SECTION 7.01. Appointment; Powers and Immunities. Each Bank hereby
irrevocably appoints and authorizes the Agent to act as its agent hereunder and
under the other Loan Documents with such powers as are specifically delegated
to the Agent by the terms hereof and thereof, together with such other powers
as are reasonably incidental thereto. The Agent: (a) shall have no duties or
responsibilities except as expressly set forth in this Agreement and the other
Loan Documents, and shall not by reason of this Agreement or any other Loan
Document be a trustee for any Bank; (b) shall not be responsible to the Banks
for any recitals, statements, representations or warranties contained in this
Agreement or any other Loan Document, or in any certificate or other document
referred to or provided for in, or received by any Bank under, this Agreement
or any other Loan Document, or for the validity, effectiveness, genuineness,
enforceability or sufficiency of this Agreement or any other Loan Document or
any other document referred to or provided for herein or therein or for any
failure by the Borrower to perform any of its obligations hereunder or
thereunder; (c) shall not be required to initiate or conduct any litigation or
collection proceedings hereunder or under any other Loan Document except to the
extent requested by the Required Banks, and then only on terms and conditions
satisfactory to the Agent, and (d) shall not be responsible for any action
taken or omitted to be taken by it hereunder or under any other Loan Document
or any other document or instrument referred to or provided for herein or
therein or in connection
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herewith or therewith, except for its own gross negligence or wilful
misconduct. The Agent may employ agents and attorneys-in-fact and shall not be
responsible for the negligence or misconduct of any such agents or
attorneys-in-fact selected by it with reasonable care. The provisions of this
Article VII are solely for the benefit of the Agent and the Banks, and the
Borrower shall not have any rights as a third party beneficiary of any of the
provisions hereof. In performing its functions and duties under this Agreement
and under the other Loan Documents, the Agent shall act solely as agent of the
Banks and does not assume and shall not be deemed to have assumed any
obligation towards or relationship of agency or trust with or for the Borrower.
The duties of the Agent shall be ministerial and administrative in nature, and
the Agent shall not have by reason of this Agreement or any other Loan Document
a fiduciary relationship in respect of any Bank.
SECTION 7.02. Reliance by Agent. The Agent shall be entitled to
rely upon any certification, notice or other communication (including any
thereof by telephone, telefax, telegram or cable) believed by it to be genuine
and correct and to have been signed or sent by or on behalf of the proper
Person or Persons, and upon advice and statements of legal counsel, independent
accountants or other experts selected by the Agent. As to any matters not
expressly provided for by this Agreement or any other Loan Document, the Agent
shall in all cases be fully protected in acting, or in refraining from acting,
hereunder and thereunder in accordance with instructions signed by the Required
Banks, and such instructions of the Required Banks in any action taken or
failure to act pursuant thereto shall be binding on all of the Banks.
SECTION 7.03. Defaults. The Agent shall not be deemed to have
knowledge of the occurrence of a Default or an Event of Default (other than the
nonpayment of principal of or interest on the Loans) unless the Agent has
received notice from a Bank or the Borrower specifying such Default or Event of
Default and stating that such notice is a "Notice of Default". In the event
that the Agent receives such a notice of the occurrence of a Default or an
Event of Default, the Agent shall give prompt notice thereof to the Banks. The
Agent shall give each Bank prompt notice of each nonpayment of principal of or
interest on the Loans whether or not it has received any notice of the
occurrence of such nonpayment. The Agent shall (subject to Section 9.06) take
such action hereunder with respect to such Default or Event of Default as shall
be directed by the Required Banks, provided that, unless and until the Agent
shall have received such directions, the Agent may (but shall not be obligated
to) take such action, or refrain from taking such
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action, with respect to such Default or Event of Default as it shall deem
advisable in the best interests of the Banks.
SECTION 7.04. Rights of Agent as a Bank. If Wachovia Bank of
Georgia, N.A. becomes a Bank hereunder at any time, the following provisions
shall apply. With respect to the Loans made by it, in its capacity as a Bank
hereunder shall have the same rights and powers hereunder as any other Bank and
may exercise the same as though it were not acting as the Agent, and the term
"Bank" or "Banks" shall, unless the context otherwise indicates, include
Wachovia in its individual capacity. The Agent may (without having to account
therefor to any Bank) accept deposits from, lend money to and generally engage
in any kind of banking, trust or other business with the Borrower (and any of
its Affiliates) as if it were not acting as the Agent, and the Agent may accept
fees and other consideration from the Borrower (in addition to any agency fees
and arrangement fees heretofore agreed to between the Borrower and the Agent)
for services in connection with this Agreement or any other Loan Document or
otherwise without having to account for the same to the Banks.
SECTION 7.05. Indemnification. Each Bank severally agrees to
indemnify the Agent, to the extent the Agent shall not have been reimbursed by
the Borrower, ratably in accordance with its Loans outstanding for any and all
liabilities, obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses (including, without limitation, counsel fees and
disbursements) or disbursements of any kind and nature whatsoever which may be
imposed on, incurred by or asserted against the Agent in any way relating to or
arising out of this Agreement or any other Loan Document or any other documents
contemplated by or referred to herein or therein or the transactions
contemplated hereby or thereby (excluding, unless an Event of Default has
occurred and is continuing, the normal administrative costs and expenses
incident to the performance of its agency duties hereunder) or the enforcement
of any of the terms hereof or thereof or any such other documents; provided
that no Bank shall be liable for any of the foregoing to the extent they arise
from the gross negligence or wilful misconduct of the Agent. If any indemnity
furnished to the Agent for any purpose shall, in the opinion of the Agent, be
insufficient or become impaired, the Agent may call for additional indemnity
and cease, or not commence, to do the acts indemnified against until such
additional indemnity is furnished.
SECTION 7.06 Consequential Damages. THE AGENT SHALL NOT BE
RESPONSIBLE OR LIABLE TO ANY BANK, THE BORROWER OR ANY OTHER PERSON OR ENTITY
FOR ANY PUNITIVE, EXEMPLARY OR CONSEQUENTIAL DAMAGES WHICH MAY BE ALLEGED AS A
RESULT OF THIS
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AGREEMENT, THE OTHER LOAN DOCUMENTS OR ANY OF THE TRANSACTIONS CONTEMPLATED
HEREBY OR THEREBY.
SECTION 7.07. Payee of Note Treated as Owner. The Agent may deem
and treat the payee of any Note as the owner thereof for all purposes hereof
unless and until a written notice of the assignment or transfer thereof shall
have been filed with the Agent and the provisions of Section 9.08(c) have been
satisfied. Any requests, authority or consent of any Person who at the time of
making such request or giving such authority or consent is the holder of any
Note shall be conclusive and binding on any subsequent holder, transferee or
assignee of that Note or of any Note or Notes issued in exchange therefor or
replacement thereof.
SECTION 7.08. Nonreliance on Agent and Other Banks. Each Bank
agrees that it has, independently and without reliance on the Agent or any
other Bank, and based on such documents and information as it has deemed
appropriate, made its own credit analysis of the Borrower and decision to enter
into this Agreement and that it will, independently and without reliance upon
the Agent or any other Bank, and based on such documents and information as it
shall deem appropriate at the time, continue to make its own analysis and
decisions in taking or not taking action under this Agreement or any of the
other Loan Documents. The Agent shall not be required to keep itself informed
as to the performance or observance by the Borrower of this Agreement or any of
the other Loan Documents or any other document referred to or provided for
herein or therein or to inspect the properties or books of the Borrower or any
other Person. Except for notices, reports and other documents and information
expressly required to be furnished to the Banks by the Agent hereunder or under
the other Loan Documents, the Agent shall not have any duty or responsibility
to provide any Bank with any credit or other information concerning the
affairs, financial condition or business of the Borrower or any other Person
(or any of their Affiliates) which may come into the possession of the Agent.
SECTION 7.09. Failure to Act. Except for action expressly required
of the Agent hereunder or under the other Loan Documents, the Agent shall in
all cases be fully justified in failing or refusing to act hereunder and
thereunder unless it shall receive further assurances to its satisfaction by
the Banks of their indemnification obligations under Section 7.05 against any
and all liability and expense which may be incurred by the Agent by reason of
taking, continuing to take, or failing to take any such action.
SECTION 7.10. Resignation or Removal of Agent. Subject to the
appointment and acceptance of a successor Agent as
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provided below, the Agent may resign at any time by giving notice thereof to
the Banks and the Borrower and the Agent may be removed at any time with or
without cause by the Required Banks. Upon any such resignation or removal, the
Required Banks shall have the right to appoint a successor Agent. If no
successor Agent shall have been so appointed by the Required Banks and shall
have accepted such appointment within 30 days after the retiring Agent's notice
of resignation or the Required Banks' removal of the retiring Agent, then the
retiring Agent may, on behalf of the Banks, appoint a successor Agent. Any
successor Agent shall be a bank which has a combined capital and surplus of at
least $500,000,000. Upon the acceptance of any appointment as Agent hereunder
by a successor Agent, such successor Agent shall thereupon succeed to and
become vested with all the rights, powers, privileges and duties of the
retiring Agent, and the retiring Agent shall be discharged from its duties and
obligations hereunder. After any retiring Agent's resignation or removal
hereunder as Agent, the provisions of this Article VII shall continue in effect
for its benefit in respect of any actions taken or omitted to be taken by it
while it was acting as the Agent hereunder.
ARTICLE VIII
CHANGE IN CIRCUMSTANCES; COMPENSATION
SECTION 8.01. Basis for Determining Interest Rate Inadequate or
Unfair. If on or prior to the first day of any Interest Period:
(a) the Agent determines that deposits in Dollars (in the
applicable amounts) are not being offered in the relevant market for such
Interest Period, or
(b) the Required Banks advise the Agent that the London
Interbank Offered Rate, as determined by the Agent, will not adequately
and fairly reflect the cost to such Banks of funding the relevant
Euro-Dollar Loans for such Interest Period,
the Agent shall forthwith give notice thereof to the Borrower and the Banks,
whereupon until the Agent notifies the Borrower that the circumstances giving
rise to such suspension no longer exist, the obligations of the Banks to make
the Euro-Dollar Loans specified in such notice shall be suspended. Unless the
Borrower notifies the Agent at least 2 Domestic Business Days before the date
of any Borrowing of such Euro-Dollar Loans for which a Notice of Borrowing has
previously been given that it elects not
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to borrow on such date, such Borrowing shall instead be made as a Base Rate
Borrowing.
SECTION 8.02. Illegality. If, after the date hereof, the adoption
of any applicable law, rule or regulation, or any change therein, or any change
in the interpretation or administration thereof by any governmental authority,
central bank or comparable agency charged with the interpretation or
administration thereof (any such agency being referred to as an "Authority" and
any such event being referred to as a "Change of Law"), or compliance by any
Bank (or its Lending Office) with any request or directive (whether or not
having the force of law) of any Authority shall make it unlawful or impossible
for any Bank (or its Lending Office) to make, maintain or fund its Euro-Dollar
Loans and such Bank shall so notify the Agent, the Agent shall forthwith give
notice thereof to the other Banks and the Borrower, whereupon until such Bank
notifies the Borrower and the Agent that the circumstances giving rise to such
suspension no longer exist, the obligation of such Bank to make Euro-Dollar
Loans shall be suspended. Before giving any notice to the Agent pursuant to
this Section, such Bank shall designate a different Lending Office if such
designation will avoid the need for giving such notice and will not, in the
judgment of such Bank, be otherwise disadvantageous to such Bank. If such Bank
shall determine that it may not lawfully continue to maintain and fund any of
its outstanding Euro-Dollar Loans to maturity and shall so specify in such
notice, the Borrower shall immediately prepay in full the then outstanding
principal amount of each Euro-Dollar Loan of such Bank, together with accrued
interest thereon. Concurrently with prepaying each such Euro-Dollar Loan, the
Borrower shall borrow a Base Rate Loan in an equal principal amount from such
Bank (on which interest and principal shall be payable contemporaneously with
the related Euro-Dollar Loans of the other Banks), and such Bank shall make
such a Base Rate Loan.
SECTION 8.03. Increased Cost and Reduced Return. (a) If after the
date hereof, a Change of Law or compliance by any Bank (or its Lending Office)
with any request or directive (whether or not having the force of law) of any
Authority:
(i) shall impose, modify or deem applicable any reserve, special
deposit or similar requirement (including, without limitation, any such
requirement imposed by the Board of Governors of the Federal Reserve
System, but excluding any such requirement included in an applicable
Euro-Dollar Reserve Percentage) against assets of, deposits with or for
the account of, or credit extended by, any Bank (or its Lending Office);
or
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(ii) shall impose on any Bank (or its Lending Office) or on the
London interbank market any other condition affecting its Euro-Dollar
Loans, its Notes or its obligation to make Euro-Dollar Loans;
and the result of any of the foregoing is to increase the cost to such Bank (or
its Lending Office) of making or maintaining any Loan, or to reduce the amount
of any sum received or receivable by such Bank (or its Lending Office) under
this Agreement or under its Notes with respect thereto, by an amount deemed by
such Bank to be material, then, within 15 days after demand by such Bank (with
a copy to the Agent), the Borrower shall pay to such Bank such additional
amount or amounts as will compensate such Bank for such increased cost or
reduction.
(b) If any Bank reasonably shall have determined that after the
date hereof the adoption of any applicable law, rule or regulation regarding
capital adequacy, or any change therein, or any change in the interpretation or
administration thereof, or compliance by any Bank (or its Lending Office) with
any request or directive regarding capital adequacy (whether or not having the
force of law) of any Authority, has or would have the effect of reducing the
rate of return on such Bank's capital as a consequence of its obligations
hereunder to a level below that which such Bank could have achieved but for
such adoption, change or compliance (taking into consideration such Bank's
policies with respect to capital adequacy) by an amount deemed by such Bank to
be material, then from time to time, within 15 days after demand by such Bank,
the Borrower shall pay to such Bank such additional amount or amounts as will
compensate such Bank for such reduction.
(c) Each Bank will promptly notify the Borrower and the Agent of
any event of which it has knowledge, occurring after the date hereof, which
will entitle such Bank to compensation pursuant to this Section and will
designate a different Lending Office if such designation will avoid the need
for, or reduce the amount of, such compensation and will not, in the judgment
of such Bank, be otherwise disadvantageous to such Bank. A certificate of any
Bank claiming compensation under this Section and setting forth the additional
amount or amounts to be paid to it hereunder shall be conclusive, provided it
has a reasonable basis for claiming compensation, in the absence of manifest
error. In determining such amount, such Bank may use any reasonable averaging
and attribution methods.
(d) The provisions of this Section 8.03 shall be applicable with
respect to any Participant, Assignee or other Transferee, and any calculations
required by such provisions
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shall be made based upon the circumstances of such Participant, Assignee or
other Transferee.
SECTION 8.04. Base Rate Loans Substituted for Affected Euro-Dollar
Loans. If (i) the obligation of any Bank to make or maintain any Euro-Dollar
Loans has been suspended pursuant to Section 8.02 or (ii) any Bank has demanded
compensation under Section 8.03, and the Borrower shall, by at least 5
Euro-Dollar Business Days' prior notice to such Bank through the Agent, have
elected that the provisions of this Section shall apply to such Bank, then,
unless and until such Bank notifies the Borrower that the circumstances giving
rise to such suspension or demand for compensation no longer apply:
(a) all Loans which would otherwise be made by such Bank as
Euro-Dollar Loans shall be made instead as Base Rate Loans, and
(b) after each of Euro-Dollar Loans has been repaid, all payments
of principal which would otherwise be applied to repay such Euro-Dollar
Loans shall be applied to repay its Base Rate Loans instead.
SECTION 8.05. Compensation. Upon the request of any Bank,
delivered to the Borrower and the Agent, the Borrower shall pay to such Bank
such amount or amounts as shall compensate such Bank for any loss, cost or
expense incurred by such Bank as a result of:
(a) any payment or prepayment (pursuant to Section 2.07, 2.08,
6.01, 8.02 or otherwise) of a Euro-Dollar Loan on a date other than the last
day of an Interest Period for such Loan; or
(b) any failure by the Borrower to borrow a Euro-Dollar Loan on
the date for the Euro-Dollar Borrowing of which such Euro-Dollar Loan is a part
specified in the applicable Notice of Borrowing delivered pursuant to Section
2.02;
such compensation to include, without limitation, an amount equal to the
excess, if any, of (x) the amount of interest which would have accrued on the
amount so paid or prepaid or not prepaid or borrowed for the period from the
date of such payment, prepayment or failure to prepay or borrow to the last day
of the then current Interest Period for such Euro-Dollar Loan (or, in the case
of a failure to prepay or borrow, the Interest Period for such Euro-Dollar Loan
which would have commenced on the date of such failure to prepay or borrow) at
the applicable rate of interest for such Euro-Dollar Loan provided for herein
over (y) the amount of interest (as reasonably determined by such Bank)
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such Bank would have paid on deposits in Dollars of comparable amounts having
terms comparable to such period placed with it by leading banks in the London
interbank market.
ARTICLE IX
MISCELLANEOUS
SECTION 9.01. Notices. All notices, requests and other
communications to any party hereunder shall be in writing (including bank wire,
telecopier or similar writing) and shall be given to such party at its address
or telecopier number set forth on the signature pages hereof or such other
address or telecopier number as such party may hereafter specify for the
purpose by notice to each other party. Each such notice, request or other
communication shall be effective (i) if given by telecopier, when such telecopy
is transmitted to the telecopier number specified in this Section and the
appropriate confirmation is received, (ii) if given by mail, 72 hours after
such communication is deposited in the mails with first class postage prepaid,
addressed as aforesaid or (iii) if given by any other means, when delivered at
the address specified in this Section; provided that notices to the Agent under
Article II or Article VIII shall not be effective until received.
SECTION 9.02. No Waivers. No failure or delay by the Agent or any
Bank in exercising any right, power or privilege hereunder or under any Note or
other Loan Document 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.
SECTION 9.03. Expenses; Documentary Taxes. The Borrower shall pay
(i) all out-of-pocket expenses of the Agent, including fees and disbursements
of special counsel for the Banks and the Agent, in connection with the
preparation of this Agreement and the other Loan Documents, any waiver or
consent hereunder or thereunder or any amendment hereof or thereof or any
Default or alleged Default hereunder or thereunder and (ii) if a Default
occurs, all out-of-pocket expenses incurred by the Agent and the Banks,
including fees and disbursements of counsel, in connection with such Default
and collection and other enforcement proceedings resulting therefrom,
including out-of-pocket expenses incurred in enforcing this Agreement and the
other Loan Documents. The Borrower shall indemnify the Agent and each Bank
against any transfer taxes, documentary taxes, assessments or charges made by
any Authority by reason of the
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execution and delivery of this Agreement or the other Loan Documents.
SECTION 9.04. Indemnification. The Borrower shall indemnify the
Agent, the Banks and each Affiliate thereof and their respective directors,
officers, employees and agents from, and hold each of them harmless against,
any and all losses, liabilities, claims or damages to which any of them may
become subject, insofar as such losses, liabilities, claims or damages arise
out of or result from any actual or proposed use by the Borrower of the
proceeds of any extension of credit by any Bank hereunder or breach by the
Borrower of this Agreement or any other Loan Document or from any
investigation, litigation (including, without limitation, any actions taken by
the Agent or any of the Banks to enforce this Agreement or any of the other
Loan Documents) or other proceeding (including, without limitation, any
threatened investigation or proceeding) relating to the foregoing, and the
Borrower shall reimburse the Agent and each Bank, and each Affiliate thereof
and their respective directors, officers, employees and agents, upon demand for
any expenses (including, without limitation, legal fees) incurred in connection
with any such investigation or proceeding; but excluding any such losses,
liabilities, claims, damages or expenses incurred by reason of the gross
negligence or wilful misconduct of the Person to be indemnified.
SECTION 9.05. Setoff; Sharing of Setoffs. (a) The Borrower agrees
that the Agent and each Bank shall have a lien for all indebtedness and
obligations owing to them from the Borrower upon all deposits or deposit
accounts, of any kind, or any interest in any deposits or deposit accounts
thereof, now or hereafter pledged, mortgaged, transferred or assigned to the
Agent or any such Bank or otherwise in the possession or control of the Agent
or any such Bank for any purpose for the account or benefit of the Borrower and
including any balance of any deposit account or of any credit of the Borrower
with the Agent or any such Bank, whether now existing or hereafter established,
hereby authorizing the Agent and each Bank at any time or times with or without
prior notice to apply such balances or any part thereof to such of the
indebtedness and obligations owing by the Borrower to the Banks and/or the
Agent then past due and in such amounts as they may elect, and whether or not
the collateral, if any, or the responsibility of other Persons primarily,
secondarily or otherwise liable may be deemed adequate. For the purposes of
this paragraph, all remittances and property shall be deemed to be in the
possession of the Agent or any such Bank as soon as the same may be put in
transit to it by mail or carrier or by other bailee.
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(b) Each Bank agrees that if it shall, by exercising any right of
setoff or counterclaim or otherwise, receive payment of a proportion of the
aggregate amount of principal and interest owing with respect to the Note held
by it which is greater than the proportion received by any other Bank in
respect of the aggregate amount of all principal and interest owing with
respect to the Note held by such other Bank, the Bank receiving such
proportionately greater payment shall purchase such participations in the Notes
held by the other Banks owing to such other Banks, and such other adjustments
shall be made, as may be required so that all such payments of principal and
interest with respect to the Notes held by the Banks owing to such other Banks
shall be shared by the Banks pro rata; provided that (i) nothing in this
Section shall impair the right of any Bank to exercise any right of setoff or
counterclaim it may have and to apply the amount subject to such exercise to
the payment of indebtedness of the Borrower other than its indebtedness under
the Notes, and (ii) if all or any portion of such payment received by the
purchasing Bank is thereafter recovered from such purchasing Bank, such
purchase from each other Bank shall be rescinded and such other Bank shall
repay to the purchasing Bank the purchase price of such participation to the
extent of such recovery together with an amount equal to such other Bank's
ratable share (according to the proportion of (x) the amount of such other
Bank's required repayment to (y) the total amount so recovered from the
purchasing Bank) of any interest or other amount paid or payable by the
purchasing Bank in respect of the total amount so recovered. The Borrower
agrees, to the fullest extent it may effectively do so under applicable law,
that any holder of a participation in a Note, whether or not acquired pursuant
to the foregoing arrangements, may exercise rights of setoff or counterclaim
and other rights with respect to such participation as fully as if such holder
of a participation were a direct creditor of the Borrower in the amount of such
participation.
SECTION 9.06. Amendments and Waivers. (a) Any provision of this
Agreement, the Notes or any other Loan Documents may be amended or waived if,
but only if, such amendment or waiver is in writing and is signed by the
Borrower and the Required Banks (and, if the rights or duties of the Agent are
affected thereby, by the Agent); provided that, no such amendment or waiver
shall, unless signed by all Banks, (i) subject any Bank to any additional
obligation, (ii) change the principal of or rate of interest on any Loan or any
fees (other than fees payable to the Agent) hereunder, (iii) change the date
fixed for any payment of principal of or interest on any Loan or any fees
hereunder, (iv) change the amount of principal, interest or fees due on any
date fixed for the payment thereof, (v) change the percentage of the aggregate
unpaid principal amount of the Notes, or the percentage of Banks, which shall
be required for
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the Banks or any of them to take any action under this Section or any other
provision of this Agreement, (vi) change the manner of application of any
payments made under this Agreement or the Notes, (vii) release or substitute
all or any substantial part of the collateral (if any) held as security for the
Loans, or (viii) release any Guarantee given to support payment of the Loans.
(b) The Borrower will not solicit, request or negotiate for or
with respect to any proposed waiver or amendment of any of the provisions of
this Agreement except through the Agent and the Agent shall be supplied by the
Borrower with sufficient information to enable the Banks to make an informed
decision with respect thereto. Executed or true and correct copies of any
waiver or consent effected pursuant to the provisions of this Agreement shall
be delivered by the Borrower to each Bank forthwith following the date on which
the same shall have been executed and delivered by the requisite percentage of
Banks. The Borrower will not, directly or indirectly, pay or cause to be paid
any remuneration, whether by way of supplemental or additional interest, fee or
otherwise, to any Bank (in its capacity as such) as consideration for or as an
inducement to the entering into by such Bank of any waiver or amendment of any
of the terms and provisions of this Agreement unless such remuneration is
concurrently paid, on the same terms, ratably to all such Banks.
SECTION 9.07. No Margin Stock Collateral. Each of the Banks
represents to the Agent and each of the other Banks that it in good faith is
not, directly or indirectly (by negative pledge or otherwise), relying upon any
Margin Stock as collateral in the extension or maintenance of the credit
provided for in this Agreement.
SECTION 9.08. Successors and Assigns. (a) 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 the Borrower may not
assign or otherwise transfer any of its rights under this Agreement.
(b) Any Bank may at any time sell to one or more Persons (each a
"Participant") participating interests in any Loan owing to such Bank, any Note
held by such Bank or any other interest of such Bank hereunder. In the event
of any such sale by a Bank of a participating interest to a Participant, such
Bank's obligations under this Agreement shall remain unchanged, such Bank shall
remain solely responsible for the performance thereof, such Bank shall remain
the holder of any such Note for all purposes under this Agreement, and the
Borrower and the Agent shall continue to deal solely and directly with such
Bank in connection with such Bank's rights and obligations under this
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Agreement. In no event shall a Bank that sells a participation be obligated to
the Participant to take or refrain from taking any action hereunder except that
such Bank may agree that it will not (except as provided below), without the
consent of the Participant, agree to (i) the change of any date fixed for the
payment of principal of or interest on the related loan or loans, (ii) the
change of the amount of any principal, interest or fees due on any date fixed
for the payment thereof with respect to the related loan or loans, (iii) the
change of the principal of the related loan or loans, (iv) any change in the
rate at which either interest is payable thereon or (if the Participant is
entitled to any part thereof) fee is payable hereunder from the rate at which
the Participant is entitled to receive interest or fee (as the case may be) in
respect of such participation, (v) the release or substitution of all or any
substantial part of the collateral (if any) held as security for the Loans, or
(vi) the release of any Guarantee given to support payment of the Loans. Each
Bank selling a participating interest in any Loan, Note, or other interest
under this Agreement shall, within 10 Domestic Business Days of such sale,
provide the Borrower and the Agent with written notification stating that such
sale has occurred and identifying the Participant and the interest purchased by
such Participant. The Borrower agrees that each Participant shall be entitled
to the benefits of Article VIII with respect to its participation in Loans
outstanding from time to time.
(c) Any Bank may at any time assign to one or more banks or
financial institutions (each an "Assignee") all or a proportionate part of all
its Loans, in an amount of not less than $5,000,000 or any larger multiple of
$1,000,000, and of its rights and obligations under this Agreement, the Notes
and the other Loan Documents, and such Assignee shall assume all such rights
and obligations, pursuant to an Assignment and Acceptance, executed by such
Assignee, such transferor Bank and the Agent (and, in the case of an Assignee
that is not then a Bank, the Borrower); provided that except during the
continuance of a Default, no interest may be sold by a Bank pursuant to this
paragraph (c) to any Assignee that is not then a Bank (or an Affiliate of a
Bank) without the consent of the Borrower and the Agent, which consent shall
not be unreasonably withheld. Upon (A) execution of the Assignment and
Acceptance by such transferor Bank, such Assignee, the Agent and (if
applicable) the Borrower, (B) delivery of an executed copy of the Assignment
and Acceptance to the Borrower and the Agent, (C) payment by such Assignee to
such transferor Bank of an amount equal to the purchase price agreed between
such transferor Bank and such Assignee, and (D) payment of a processing and
recordation fee of $2,000 to the Agent, such Assignee shall for all purposes be
a Bank party to this Agreement and shall have all the rights and obligations of
a Bank under this Agreement to the same extent as if it were an
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original party hereto with Loans as set forth in such instrument of assumption,
and the transferor Bank shall be released from its obligations hereunder to a
corresponding extent, and no further consent or action by the Borrower, the
Banks or the Agent shall be required. Upon the consummation of any transfer to
an Assignee pursuant to this paragraph (c), the transferor Bank, the Agent and
the Borrower shall make appropriate arrangements so that, if required, a new
Note is issued to such Assignee.
(d) Subject to the provisions of Section 9.09, the Borrower
authorizes each Bank to disclose to any Participant, Assignee or other
transferee (each a "Transferee") and any prospective Transferee any and all
financial information in such Bank's possession concerning the Borrower which
has been delivered to such Bank by the Borrower pursuant to this Agreement or
which has been delivered to such Bank by the Borrower in connection with such
Bank's credit evaluation prior to entering into this Agreement.
(e) No Transferee shall be entitled to receive any greater
payment under Section 8.03 than the transferor Bank would have been entitled to
receive with respect to the rights transferred, unless such transfer is made
with the Borrower's prior written consent or by reason of the provisions of
Section 8.02 or 8.03 requiring such Bank to designate a different Lending
Office under certain circumstances or at a time when the circumstances giving
rise to such greater payment did not exist.
(g) Anything in this Section 9.08 to the contrary
notwithstanding, any Bank may assign and pledge all or any portion of the Loans
and/or obligations owing to it to any Federal Reserve Bank or the United States
Treasury as collateral security pursuant to Regulation A of the Board of
Governors of the Federal Reserve System and any Operating Circular issued by
such Federal Reserve Bank, provided that any payment in respect of such
assigned Loans and/or obligations made by the Borrower to the assigning and/or
pledging Bank in accordance with the terms of this Agreement shall satisfy the
Borrower's obligations hereunder in respect of such assigned Loans and/or
obligations to the extent of such payment. No such assignment shall release
the assigning and/or pledging Bank from its obligations hereunder.
SECTION 9.09. Confidentiality. Each Bank agrees to exercise
commercially reasonable efforts to keep any information delivered or made
available by the Borrower to it which is clearly indicated to be confidential
information, confidential from anyone other than persons employed or retained
by such Bank who are or are expected to become engaged in evaluating,
approving, structuring or administering the Loans; provided that nothing herein
shall prevent any Bank from disclosing such
Page 80 of 87
<PAGE> 64
information (i) to any other Bank, (ii) upon the order of any court or
administrative agency, (iii) upon the request or demand of any regulatory
agency or authority having jurisdiction over such Bank, (iv) which has been
publicly disclosed, (v) to the extent reasonably required in connection with
any litigation to which the Agent, any Bank or their respective Affiliates may
be a party, (vi) to the extent reasonably required in connection with the
exercise of any remedy hereunder, (vii) to such Bank's legal counsel and
independent auditors and (viii) to any actual or proposed Participant, Assignee
or other Transferee of all or part of its rights hereunder which has agreed in
writing to be bound by the provisions of this Section 9.09; provided that
should disclosure of any such confidential information be required by virtue of
clause (ii) of the immediately preceding sentence, any relevant Bank shall
promptly notify the Borrower of same so as to allow the Borrower to seek a
protective order or to take any other appropriate action; provided, further,
that, no Bank shall be required to delay compliance with any directive to
disclose any such information so as to allow the Borrower to effect any such
action.
SECTION 9.10. Representation by Banks. Each Bank hereby represents
that it is a commercial lender or financial institution which makes Loans in
the ordinary course of its business and that it will make its Loans hereunder
for its own account in the ordinary course of such business; provided that,
subject to Section 9.08, the disposition of the Note or Notes held by that Bank
shall at all times be within its exclusive control.
SECTION 9.11. Obligations Several. The obligations of each Bank
hereunder are several, and no Bank shall be responsible for the obligations or
commitment of any other Bank hereunder. Nothing contained in this Agreement
and no action taken by the Banks pursuant hereto shall be deemed to constitute
the Banks to be a partnership, an association, a joint venture or any other
kind of entity. The amounts payable at any time hereunder to each Bank shall
be a separate and independent debt, and each Bank shall be entitled to protect
and enforce its rights arising out of this Agreement or any other Loan Document
and it shall not be necessary for any other Bank to be joined as an additional
party in any proceeding for such purpose.
SECTION 9.12. Georgia Law. This Agreement and each Note shall be
construed in accordance with and governed by the law of the State of Georgia.
SECTION 9.13. Severability. In case any one or more of the
provisions contained in this Agreement, the Notes or any of the other Loan
Documents should be invalid, illegal or
Page 81 of 87
<PAGE> 65
unenforceable in any respect, the validity, legality and enforceability of the
remaining provisions contained herein and therein shall not in any way be
affected or impaired thereby and shall be enforced to the greatest extent
permitted by law.
SECTION 9.14. Interest. In no event shall the amount of interest,
and all charges, amounts or fees contracted for, charged or collected pursuant
to this Agreement, the Notes or the other Loan Documents and deemed to be
interest under applicable law (collectively, "Interest") exceed the highest
rate of interest allowed by applicable law (the "Maximum Rate"), and in the
event any such payment is inadvertently received by any Bank, then the excess
sum (the "Excess") shall be credited as a payment of principal, unless the
Borrower shall notify such Bank in writing that it elects to have the Excess
returned forthwith. It is the express intent hereof that the Borrower not pay
and the Banks not receive, directly or indirectly in any manner whatsoever,
interest in excess of that which may legally be paid by the Borrower under
applicable law. The right to accelerate maturity of any of the Loans does not
include the right to accelerate any interest that has not otherwise accrued on
the date of such acceleration, and the Agent and the Banks do not intend to
collect any unearned interest in the event of any such acceleration. All
monies paid to the Agent or the Banks hereunder or under any of the Notes or
the other Loan Documents, whether at maturity or by prepayment, shall be
subject to rebate of unearned interest as and to the extent required by
applicable law. By the execution of this Agreement, the Borrower covenants
that (i) the credit or return of any Excess shall constitute the acceptance by
the Borrower of such Excess, and (ii) the Borrower shall not seek or pursue any
other remedy, legal or equitable, against the Agent or any Bank, based in whole
or in part upon contracting for charging or receiving any Interest in excess of
the Maximum Rate. For the purpose of determining whether or not any Excess has
been contracted for, charged or received by the Agent or any Bank, all interest
at any time contracted for, charged or received from the Borrower in connection
with this Agreement, the Notes or any of the other Loan Documents shall, to the
extent permitted by applicable law, be amortized, prorated, allocated and
spread in equal parts throughout the full term of the Term Loans. The
Borrower, the Agent and each Bank shall, to the maximum extent permitted under
applicable law, (i) characterize any non-principal payment as an expense, fee
or premium rather than as Interest and (ii) exclude voluntary prepayments and
the effects thereof. The provisions of this Section shall be deemed to be
incorporated into each Note and each of the other Loan Documents (whether or
not any provision of this Section is referred to therein). All such Loan
Documents and communications relating to any Interest owed by the Borrower and
all figures set forth therein shall, for the sole purpose of
Page 82 of 87
<PAGE> 66
computing the extent of obligations hereunder and under the Notes and the other
Loan Documents be automatically recomputed by the Borrower, and by any court
considering the same, to give effect to the adjustments or credits required by
this Section.
SECTION 9.15. Interpretation. No provision of this Agreement or
any of the other Loan Documents shall be construed against or interpreted to
the disadvantage of any party hereto by any court or other governmental or
judicial authority by reason of such party having or being deemed to have
structured or dictated such provision.
SECTION 9.16. Waiver of Jury Trial; Consent to Jurisdiction. The
Borrower (a) and each of the Banks and the Agent irrevocably waives, to the
fullest extent permitted by law, any and all right to trial by jury in any
legal proceeding arising out of this Agreement, any of the other Loan
Documents, or any of the transactions contemplated hereby or thereby, (b)
submits to the nonexclusive personal jurisdiction in the State of Georgia, the
courts thereof and the United States District Courts sitting therein, for the
enforcement of this Agreement, the Notes and the other Loan Documents, (c)
waives any and all personal rights under the law of any jurisdiction to object
on any basis (including, without limitation, inconvenience of forum) to
jurisdiction or venue within the State of Georgia for the purpose of litigation
to enforce this Agreement, the Notes or the other Loan Documents, and (d)
agrees that service of process may be made upon it in the manner prescribed in
Section 9.01 for the giving of notice to the Borrower. Nothing herein
contained, however, shall prevent the Agent from bringing any action or
exercising any rights against any security and against the Borrower personally,
and against any assets of the Borrower, within any other state or jurisdiction.
SECTION 9.17. Counterparts. This Agreement may be signed in any
number of counterparts, each of which shall be an original, with the same
effect as if the signatures thereto and hereto were upon the same instrument.
Page 83 of 87
<PAGE> 67
SECTION 9.18. Source of Funds -- ERISA. Each of the Banks hereby
severally (and not jointly) represents to the Borrower that no part of the
funds to be used by such Bank to fund the Loans hereunder from time to time
constitutes (i) assets allocated to any separate account maintained by such
Bank in which any employee benefit plan (or its related trust) has any interest
nor (ii) any other assets of any employee benefit plan. As used in this
Section, the terms "employee benefit plan" and "separate account" shall have
the respective meanings assigned to such terms in Section 3 of ERISA.
[Signatures are contained on the following pages.]
Page 84 of 87
<PAGE> 68
IN WITNESS WHEREOF, the parties hereto have caused this Agreement
to be duly executed, under seal, by their respective authorized officers as of
the day and year first above written.
SPRINGS INDUSTRIES, INC.(SEAL)
By: /s/ James F. Zahrn
-------------------------------
Title: Senior Vice President
Springs Industries, Inc.
205 North White Street
Fort Mill, South Carolina 29715
Attention: Chief Financial Officer
Telecopier number: 803-547-3707
Confirmation number: 803-547-3774
WACHOVIA BANK OF GEORGIA, N.A.,
as Agent (SEAL)
By: /s/ Terrence S. Katon
-------------------------------
Title: Vice President
Wachovia Bank of Georgia, N.A.
191 Peachtree Street, N.E.
Atlanta, Georgia 30303-1757
Attention: Syndications Group
Telecopier number: 404-332-4005
Confirmation number: 404-332-6454
Page 85 of 87
<PAGE> 69
COMMITMENTS WACHOVIA BANK OF NORTH
- ----------- CAROLINA, N.A. (SEAL)
$100,000,000
By: /s/Joanne M. Starnes
-------------------------------
Title: Senior Vice President
Lending Office
--------------
Wachovia Bank of North
Carolina, N.A.
400 South Tryon Street
Charlotte, North Carolina 28202
Mail Code 21065-6th Floor
Attention: Joanne M. Starnes
Telecopier number: 704-378-5181
Confirmation number: 704-378-5361
Page 86 of 87
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
FINANCIAL STATEMENTS OF SPRINGS INDUSTRIES FOR THE PERIOD ENDED APRIL 1, 1995,
AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-30-1995
<PERIOD-START> JAN-01-1995
<PERIOD-END> APR-01-1995
<CASH> 1,142
<SECURITIES> 0
<RECEIVABLES> 307,849
<ALLOWANCES> 7,674
<INVENTORY> 299,229
<CURRENT-ASSETS> 640,715
<PP&E> 1,271,382
<DEPRECIATION> 717,598
<TOTAL-ASSETS> 1,314,274
<CURRENT-LIABILITIES> 269,686
<BONDS> 261,786
<COMMON> 4,430
0
0
<OTHER-SE> 585,675
<TOTAL-LIABILITY-AND-EQUITY> 1,314,274
<SALES> 483,136
<TOTAL-REVENUES> 483,136
<CGS> 396,028
<TOTAL-COSTS> 396,028
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 7,252
<INCOME-PRETAX> 16,681
<INCOME-TAX> 6,813
<INCOME-CONTINUING> 9,868
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 9,868
<EPS-PRIMARY> .55
<EPS-DILUTED> .55
</TABLE>
