Exhibit 10.1
EXECUTION VERSION
OMNIBUS AMENDMENT TO
REVOLVING CREDIT AGREEMENT
AND
GUARANTEE AND COLLATERAL AGREEEMENT
dated as of October 12, 2006
among
THE PACIFIC LUMBER COMPANY
and
BRITT LUMBER CO., INC.,
as Borrowers
THE LENDERS PARTY HERETO,
MARATHON STRUCTURED FINANCE FUND L.P.,
as Administrative Agent
and
MARATHON STRUCTURED FINANCE FUND L.P.,
as Sole Bookrunner and Sole Lead Arranger
and
LASALLE BUSINESS CREDIT, LLC,
as Collateral Agent
and
LASALLE BANK NATIONAL ASSOCIATION
as
Issuing Bank
TABLE OF CONTENTS
Page
SECTION 1
DEFINITIONS..........................................................
SECTION 2
RECITALS.............................................................
SECTION 3 AMENDMENTS TO THE CREDIT
AGREEMENT...................................
SECTION 4 AMENDMENTS TO THE GUARANTEE AND COLLATERAL
AGREEMENT.................
SECTION 5
CONDITIONS...........................................................
SECTION 6 REPRESENTATIONS AND
WARRANTIES.......................................
SECTION 7
REAFFIRMATION........................................................
SECTION 8 NO
WAIVER............................................................
SECTION 9 GENERAL
PROVISIONS...................................................
THIS OMNIBUS
AMENDMENT TO REVOLVING
CREDIT
AGREEMENT
AND
GUARANTEE AND
COLLATERAL
AGREEMENT is dated as of October 12, 2006 (this "Amendment"),
among
THE PACIFIC LUMBER COMPANY
("PALCO"),
a Delaware
corporation and BRITT LUMBER
CO.,
INC.
("Britt"),
a California
corporation,
the Lenders (as such term is
defined in the Credit Agreement
described below),
MARATHON
STRUCTURED FINANCE
FUND L.P.,
as
administrative
agent (in such
capacity and
together
with its
successors,
the
"Administrative
Agent"),
LASALLE
BUSINESS
CREDIT,
LLC, as
collateral
agent
(in such
capacity
and
together
with its
successors,
the
"Collateral
Agent", and together with the Administrative
Agent, the "Agents"),
and
LASALLE
BANK
NATIONAL
ASSOCIATION
("LaSalle
Bank") in its
capacity as
Issuing
Bank,
and amends the Credit
Agreement (as defined
below).
PALCO and
Britt are
sometimes
referred to herein
collectively
as the
"Borrowers"
and
individually as a "Borrower").
WHEREAS, the Administrative
Agent, the Borrowers and the Lenders are party
to that certain Credit Agreement dated as of July 18, 2006 (as the
same has been
amended, restated, supplemented or otherwise modified as of the
date hereof, the
"Credit
Agreement"),
pursuant to which the Lenders
have made
certain
loans,
advances
and other
accommodations
to the
Borrowers
and the
Borrowers
have
granted to the
Administrative
Agent,
for the
benefit of the
Lenders and any
other lenders who from time to time may become party to the Credit
Agreement,
a
lien on and a security
interest in all of the
Borrowers'
real,
personal
and
intellectual
property to secure the
Borrowers'
liabilities
arising under the
Credit Agreement (collectively, the "Existing Obligations");
WHEREAS,
the
Administrative
Agent,
the
Borrowers,
Maxxam
Group Inc.,
("Holdings")
Salmon Creek LLC ("Salmon") and Scotia Inn Inc. ("Scotia Inn," and
together with Salmon and the Borrowers,
the
"Grantors") are also party to that
certain
Guarantee and
Collateral
Agreement
dated as of July 18, 2006 (as the
same has been amended,
restated,
supplemented or otherwise
modified as of the
date hereof, the "Guarantee and Collateral Agreement"), pursuant to
which, among
other
things,
(i) Salmon and Scotia
Inn
guaranteed
the prompt and
complete
payment and performance by the Borrowers of all of the Borrower
Obligations (as
defined therein), (ii) each Grantor granted to the Administrative
Agent, for the
benefit of the
Lenders
and any other
lenders who from time to time may become
party to the Credit
Agreement,
a lien on and a security interest in all of the
Grantor's assets,
and (iii) Holdings granted to the
Administrative
Agent, for
the
benefit
of the
Lenders
and any other
lenders
who from time to time may
become
party
to the
Credit
Agreement,
a
security
interest
in all
equity
interests in PALCO;
WHEREAS the Borrowers have requested that the Administrative
Agent and the
Lenders amend the Credit
Agreement and the Guarantee and Collateral
Agreement,
to, among other things, (i) reflect the addition of LaSalle
Business Credit, LLC
("LaSalle") as a lender; (ii) assign certain duties of the
Administrative
Agent
to
LaSalle
and
appoint
LaSalle
as the
collateral
agent
under the
Credit
Agreement (iii) appoint
LaSalle Bank National
Association as the Issuing Bank,
and (iv) make other
modifications to the Credit Agreement and the Guarantee and
Collateral
Agreement,
in each case,
upon the terms and
conditions
set forth
herein; and
WHEREAS,
it
is
the
intention
of
the
Borrowers,
the
Lenders,
the
Administrative
Agent and the Collateral
Agent that the amendment of the Credit
Agreement
pursuant to this Amendment shall not effect a refinancing or
novation
of the
Existing
Obligations
which shall remain
outstanding
under the Credit
Agreement and shall remain secured by the "Collateral" (as defined
in the Credit
Agreement).
The parties hereto agree as follows:
SECTION 1 DEFINITIONS.
Capitalized
terms used in this
Amendment,
unless
otherwise
defined herein,
shall have the applicable
meaning
ascribed to such
terms in the Credit Agreement and/or the Guarantee and Collateral
Agreement.
SECTION 2 RECITALS.
The foregoing
Recitals are hereby made a part of this
Amendment.
SECTION 3
AMENDMENTS
TO THE
CREDIT
AGREEMENT.
Subject to the terms and
conditions
set forth
herein and in reliance
upon each
respective
Borrower's
representations,
acknowledgments
and warranties herein
contained,
the Credit
Agreement is hereby amended as follows:
SECTION 3.1 Section 1.01 of the Credit
Agreement is hereby
amended to add
the following definitions in their appropriate alphabetical
position within such
Section:
"Administrative
Fee Letter"
shall mean that certain Fee Letter dated
as of the Closing Date between PALCO and Marathon
Structured
Finance Fund
L.P., as amended, supplemented, restated or otherwise modified from
time to
time.
"Agents" shall have the meaning assigned to such term in the
preamble.
"Cash
Collateral"
means to deliver cash collateral to the Collateral
Agent in an amount equal to 105% of the L/C Exposure as of such
date, to be
held as cash
collateral
for
outstanding
Letters of Credit,
pursuant to
documentation
satisfactory
to the Collateral
Agent.
Derivatives of such
term have corresponding meanings.
"Collateral Agent" shall have the meaning assigned to such term in
the
preamble.
"Collateral Agent Fee Letter" shall mean that certain Collateral
Agent
Fee Letter dated as of October 12, 2006 between PALCO and LaSalle
Business
Credit, LLC, as amended, supplemented,
restated or otherwise modified from
time to time.
"LaSalle" has the meaning assigned such term in the recitals.
"LaSalle Bank" has the meaning assigned such term in the preamble.
"L/C Application"
means, with respect to any request for the issuance
of a Letter of
Credit,
a letter of credit
application
in the form being
used by the Issuing Bank at the time of such request for the type
of letter
of credit requested.
"L/C Fee Rate" shall mean 2.75% per annum.
"Master Letter of Credit
Agreement"
means, at any time, with respect
to the issuance of Letters of Credit,
a master letter of credit
agreement
or
reimbursement
agreement in the form, if any, being used by the Issuing
Bank at such time.
SECTION
3.2
The
definition
of
each
of
"Appraisal,"
"Borrowing
Availability,"
"Borrowing
Base,"
"Borrowing
Base
Certificate,"
"Borrowing
Request," "Eligible Accounts," "Eligible
Inventory," "Excluded Taxes," "Federal
Funds
Effective
Rate," "Fees,"
"Issuing
Bank," ""L/C
Exposure,"
"Lenders,"
"Letter of Credit," "LIBO Rate," "Loan
Documents,"
"Material
Adverse Effect,"
"Net Cash Proceeds," "Net Orderly
Liquidation Value," "Prime Rate," "Reserves,"
"Statutory
Reserve,"
and
"Swingline
Lender" set forth in Section 1.01 of the
Credit
Agreement are hereby
amended and restated in their
entirety to read as
follows:
"Appraisal" means an appraisal
delivered by Administrative
Borrower,
at Borrowers'
expense,
to Administrative
Agent prior to the Closing Date
and thereafter
Collateral
Agent pursuant to Section 5.04(k) setting forth
the Net Orderly
Liquidation
Value of the Inventory of each
Borrower,
in
form and
substance
and prepared by an
independent
appraiser
reasonably
acceptable to Collateral Agent.
"Borrowing
Availability"
means as of any time of
determination
the
lesser of (i) the Total Revolving
Credit
Commitment at such time and (ii)
the
Borrowing
Base at such time,
in each
case,
less the sum of (a) the
Loans then outstanding
(including,
without
duplication,
the outstanding
balance of the Swingline Loan then outstanding), (b) aggregate L/C
Exposure
at such
time
(excluding
any
Letters
of
Credit
which
have
been Cash
Collateralized)
and
(c)
Reserves
established
by
either
Agent
in its
reasonable credit judgment.
"Borrowing Base" means, at any time, an amount equal to the sum of:
(i) at all times other than
during the
Seasonal
Overadvance
Period
eighty-five
percent
(85%) of the Net Amount of Eligible
Accounts or (ii)
during the Seasonal Overadvance Period ninety-five percent (95%) of
the Net
Amount of Eligible Accounts; plus
(i) at all times other than during the Seasonal Overadvance Period
the
lesser of (x) eighty
percent
(80%) of the value
(being the lower of cost
(on a first-in
first-out
basis) or market) of Eligible
Inventory
or (y)
eighty-five percent (85%) of the Net Orderly Liquidation Value at
such time
of the value
(being the lower of cost (on a first-in
first-out
basis) or
market) of
Eligible
Inventory
or (ii)
during the
Seasonal
Overadvance
Period the lesser of (x) ninety percent (90%) of the value (being
the lower
of cost (on a first-in first-out basis) or market) of Eligible
Inventory or
(y) ninety-five
percent (95%) of the Net Orderly Liquidation Value at such
time of the value (being the lower of cost (on a first-in
first-out basis)
or market) of Eligible Inventory; less
Reserves
from
time
to
time
established
by
either
Agent
in its
reasonable credit judgment.
"Borrowing
Base
Certificate"
means a
certificate
by a Responsible
Officer of PALCO,
substantially
in the form of Exhibit H (or another form
acceptable to the Collateral
Agent)
setting forth the
calculation of the
Borrowing Base,
including a calculation of each component thereof,
all in
such detail as shall be reasonably
satisfactory
to the Collateral
Agent.
All
calculations
of the Borrowing Base in connection with the preparation
of any Borrowing
Base
Certificate
shall
originally be made by PALCO and
certified to the Collateral
Agent;
provided,
that the
Collateral
Agent
shall
have
the
right
to
review
and
adjust,
in the
exercise
of its
reasonable
credit
judgment,
any
such
calculation
(1) to
reflect
its
reasonable estimate of declines in value of any of the Collateral
described
therein,
and (2) to the extent that such
calculation is not in accordance
with this Agreement.
"Borrowing
Request"
shall
mean
a
request
by
the
Administrative
Borrower in accordance with the terms of Section 2.03 and
substantially in
the form of
Exhibit
D, or such
other
form as shall be
approved
by the
Collateral Agent.
"Eligible Accounts" shall mean the Accounts which the Collateral
Agent
in the exercise of its reasonable
commercial
discretion
determines to be
Eligible Accounts.
Without limiting the discretion of the Collateral Agent
to establish other criteria of ineligibility,
Eligible Accounts shall not,
unless the
Collateral
Agent in its sole
discretion
elects,
include any
Account:
(a) with
respect
to which more than 60 days have
elapsed
since the
date of the
original
invoice
therefor or which is more than 30 days past
due,
provided,
that during the period from November 1 through March 31 in
any year any Account that is subject to an Extended
Terms Invoice and with
respect to which no more than 120 days have
elapsed
since the date of the
original
invoice
therefor or which is no more than 30 days past due shall
be eligible,
provided, that when such Account is aggregated with the gross
amount of all other such Accounts then outstanding,
such aggregated amount
shall not exceed $2,500,000;
(b) with
respect
to which
any of the
representations,
warranties,
covenants, and agreements contained in the Security Documents are
incorrect
or have been breached;
(c) with respect to which
Account (or any other Account due from such
Account
Debtor),
in whole or in part, a check,
promissory
note,
draft,
trade
acceptance
or other
instrument
for the
payment of money has been
received, presented for payment and returned uncollected for any
reason;
(d) which represents a progress billing (as hereinafter defined) or
as
to which the applicable
Borrower has extended the time for payment without
the consent of the Collateral
Agent;
for the purposes
hereof,
"progress
billing"
means any invoice
for goods sold or leased or services
rendered
under a
contract
or
agreement
pursuant
to which the
Account
Debtor's
obligation
to
pay
such
invoice
is
conditioned
upon
the
applicable
Borrower's
completion
of any further
performance
under the
contract or
agreement;
(e) with respect to which any one or more of the following
events has
occurred
to
the
Account
Debtor
on
such
Account:
death
or
judicial
declaration of incompetency of an Account Debtor who is an
individual;
the
filing by or
against
the
Account
Debtor of a request
or
petition
for
liquidation, reorganization, arrangement, adjustment of debts,
adjudication
as
a
bankrupt,
winding-up,
or
other
relief
under
the
bankruptcy,
insolvency,
or similar laws of the United
States,
any state or territory
thereof,
or any foreign
jurisdiction,
now or
hereafter
in effect;
the
making of any general
assignment by the Account
Debtor for the benefit of
creditors;
the appointment of a receiver or trustee for the Account Debtor
or
for
any of
the
assets
of the
Account
Debtor,
including,
without
limitation,
the
appointment of or taking
possession by a "custodian," as
defined in the Federal
Bankruptcy
Code; the institution by or against the
Account
Debtor of any
other
type of
insolvency
proceeding
(under
the
bankruptcy
laws of the
United
States or
otherwise)
or of any formal or
informal
proceeding for the dissolution or liquidation
of,
settlement of
claims against,
or winding up of affairs of, the Account Debtor; the sale,
assignment,
or transfer of all or any
material
part of the assets of the
Account Debtor; the nonpayment generally by the Account Debtor of
its debts
as they become due; or the cessation of the business of the Account
Debtor
as a going concern;
(f) if fifty percent
(50%) or more of the aggregate
Dollar amount of
outstanding
Accounts
owed at such time by the Account
Debtor
thereon is
classified as ineligible under clause (a) above;
(g) owed by an Account
Debtor which:
(i) does not maintain its chief
executive
office in the United States of America or Canada (other than the
Province of
Newfoundland);
or (ii) is not organized under the laws of the
United
States of America or Canada or any state or
province
thereof;
or
(iii) is the government of any foreign
country or sovereign
state,
or of
any state, province,
municipality, or other political subdivision thereof,
or of any department,
agency, public corporation, or other instrumentality
thereof;
except to the extent that such Account is secured or payable by a
letter of credit satisfactory to the Collateral Agent in its
discretion;
(h) owed by an Account Debtor which is an Affiliate or employee of
the
applicable Borrower;
(i) except as
provided
in clause (k)
below,
with
respect to which
either the perfection,
enforceability,
or validity of the
Administrative
Agent's
Liens in such
Account,
or the
Administrative
Agent's
right or
ability
to
obtain
direct
payment
to the
Administrative
Agent
of the
proceeds
of such
Account,
is governed by any
federal,
state,
or local
statutory requirements other than those of the UCC;
(j) owed by an Account Debtor to which the applicable
Borrower or any
of its
Subsidiaries,
is
indebted
in any way, or which is subject to any
right of setoff or
recoupment
by the Account
Debtor,
unless the Account
Debtor has entered into an agreement acceptable to the
Administrative Agent
to waive
setoff
rights;
or if the Account
Debtor
thereon has
disputed
liability or made any claim with respect to any other Account due
from such
Account
Debtor;
but in
each
such
case
only
to
the
extent
of
such
indebtedness, setoff, recoupment, dispute, or claim;
(k) owed by the
government
of the United
States of America,
or any
department,
agency, public corporation,
or other instrumentality thereof,
unless the Federal
Assignment of Claims Act of 1940, as amended (31 U.S.C.
ss.
3727
et
seq.),
and
any
other
steps
necessary
to
perfect
the
Administrative
Agent's
Liens
therein,
have
been
complied
with to the
Collateral Agent's satisfaction with respect to such Account;
(l) owed by any state, municipality, or other political subdivision
of
the
United
States
of
America,
or
any
department,
agency,
public
corporation,
or
other
instrumentality
thereof
and
as
to
which
the
Collateral
Agent
determines
that its Lien
therein
is not or
cannot be
perfected;
(m) which represents a sale on a bill-and-hold,
guaranteed sale, sale
and return,
sale on approval,
consignment,
or other repurchase or return
basis;
(n) which is evidenced by a promissory note or other
instrument or by
chattel paper;
(o)
if
the
Collateral
Agent
believes,
in
the
exercise
of
its
reasonable
judgment,
that the prospect of
collection
of such Account is
impaired
or that the
Account
may not be paid by
reason
of the
Account
Debtor's financial inability to pay;
(p) with
respect to which the Account
Debtor is located in any state
requiring the filing of a Notice of Business
Activities
Report or similar
report
in
order
to
permit
the
applicable
Borrower
to seek
judicial
enforcement in such State of payment of such Account,
unless such Borrower
has
qualified
to do
business
in such
state or has
filed a
Notice
of
Business Activities Report or equivalent report for the then
current year;
(q) which arises out of a sale not made in the ordinary
course of the
applicable Borrower's business;
(r) with
respect to which the goods
giving rise to such Account have
not been shipped and delivered to and accepted by the Account
Debtor or the
services
giving
rise to such
Account
have
not
been
performed
by the
applicable Borrower, and, if applicable, accepted by the Account
Debtor, or
the Account Debtor revokes its acceptance of such goods or
services;
(s) owed by an Account Debtor or a group of affiliated Account
Debtors
which is
obligated
to the
applicable
Borrower
respecting
Accounts the
aggregate
unpaid
balance of which
exceeds
fifteen
percent (15%) of the
aggregate unpaid balance of all Accounts owed to such Borrower at
such time
by all of the Borrower's
Account
Debtors,
but only to the extent of such
excess;
(t) which is not subject to a first
priority and
perfected
security
interest
in favor
of the
Administrative
Agent
for the
benefit
of the
Secured Parties;
(u) as to which any
Borrower
is not able to bring suit or
otherwise
enforce its remedies against the Account Debtor through judicial
process;
(v) that is not a true and correct statement of bona fide
indebtedness
incurred in the amount of the Account for
merchandise
sold to or services
rendered and accepted by the applicable Account Debtor;
(w) with
respect to which an invoice,
reasonably
acceptable
to the
Collateral Agent in form and substance, has not been sent to the
applicable
Account Debtor;
(x) that (i) is not owned by any
Borrower
or (ii) is
subject to any
Lien of any other person,
other than Liens in favor of the
Administrative
Agent, on behalf of itself and the Lenders;
(y) to the extent such Account exceeds any credit limit established
by
the Collateral
Agent, in its reasonable
credit judgment,
following prior
notice
of
such
limit
by the
Collateral
Agent
to
the
Administrative
Borrower; and
(z) that is payable in any currency other than dollars.
In
addition,
(i) to the
extent
that the
amounts in respect of any
Account in the general ledger are lower than the amounts in respect
of such
Account in the monthly aging reports submitted to the Collateral
Agent, the
difference
between such amounts shall be excluded from the
calculation of
Eligible
Accounts
and (ii) if PALCO does not own any Equity
Interest
in
Britt, no Account of Britt shall constitute an Eligible Account.
If any Account at any time ceases to be an Eligible Account, then
such
Account
shall
promptly
be
excluded
from the
calculation
of
Eligible
Accounts.
"Eligible
Inventory"
means Inventory which the Collateral
Agent, in
its reasonable
discretion,
determines to be Eligible
Inventory.
Without
limiting the discretion of the Collateral Agent to establish other
criteria
of ineligibility, Eligible Inventory shall not, unless the
Collateral Agent
in its sole discretion elects, include any Inventory:
(a) that is not owned by the applicable Borrower;
(b) that is not subject to the Administrative Agent's Liens, which
are
perfected
as to such
Inventory,
or that are
subject
to any other
Lien
whatsoever
(other than the Liens
described
in clause (d) of Section 6.02
provided
that such
Permitted
Liens (i) are
junior
in
priority
to the
Administrative
Agent's Liens or subject to Reserves and (ii) do not impair
directly or indirectly the ability of the
Administrative
Agent to realize
on or obtain the full benefit of the Collateral);
(c) that does not consist of finished goods or raw materials;
(d) that
consists of chemicals,
samples,
prototypes,
supplies,
or
packing and shipping materials;
(e) that is not in good condition, is unmerchantable, or does not
meet
all standards
imposed by any
Governmental
Authority,
having
regulatory
authority over such goods, their use or sale;
(f)
that
is not
currently
either
usable
or
salable,
at
prices
approximating
at
least
cost,
in the
normal
course
of the
applicable
Borrower's business, or that is slow moving or stale;
(g) that is obsolete or returned or repossessed or used goods taken
in
trade;
(h) that is located
outside the
placecountry-regionUnited
States of
America (or that is in-transit from vendors or suppliers);
(i) that is located in a public warehouse or in possession of a
bailee
or in a facility leased by the applicable Borrower, if the
warehouseman, or
the bailee,
or the lessor has not delivered to the
Collateral
Agent,
if
requested by the Collateral
Agent, a
subordination
agreement in form and
substance satisfactory to the Collateral Agent or if a Reserve for
rents or
storage charges has not been established for Inventory at that
location;
(j) that
contains
or bears any
proprietary
rights
licensed to the
applicable Borrower by any Person, if the Collateral Agent is not
satisfied
that
the
Administrative
Agent
may
sell or
otherwise
dispose
of such
Inventory
in
accordance
with the
terms of the
Security
Documents
and
Section
6.05
without
infringing
the
rights
of the
licensor
of
such
proprietary
rights or
violating
any
contract
with such
licensor
(and
without
payment of any royalties other than any royalties due with respect
to the sale or
disposition
of such
Inventory
pursuant
to the
existing
license
agreement),
and,
as to which
the
applicable
Borrower
has not
delivered to the
Collateral
Agent a consent or sublicense
agreement from
such licensor in form and substance
acceptable to the Collateral
Agent if
requested;
(k) that is Inventory placed on consignment;
(l) that consists of the difference
between any Borrower's
first-in,
first-out log costs and estimated market value log costs;
(m) that consists of the difference
between any Borrower's
first-in,
first-out lumber costs and reported market value lumber costs;
(n)(i) is not located on premises owned, leased or rented by
Borrowers
and set forth in
Disclosure
Schedule
3.20 or (ii) is located at an owned
location
subject
to a
mortgage
in
favor
of a
lender
other
than the
Administrative Agent, unless a reasonably satisfactory mortgagee
waiver has
been delivered to the Collateral Agent;
(o) that is covered by a
negotiable
document
of title,
unless such
document has been
delivered
to the
Collateral
Agent with all
necessary
endorsements,
free and
clear of all
Liens
except
those in favor of the
Administrative Agent and Lenders;
(p) that is not of a type held for sale in the ordinary
course of the
applicable Borrower's business;
(q) that breaches any of the representations or warranties
pertaining
to Inventory set forth in the Loan Documents;
(r) that consists of any costs associated with "freight in"
charges;
(s)
that
consists
of
Hazardous
Materials
or
goods
that
can be
transported or sold only with licenses that are not readily
available; or
(t) that is not covered by casualty insurance reasonably acceptable
to
the Collateral Agent.
In
addition,
(i) to the
extent
that the
amounts in respect of any
Inventory
in the
general
ledger are lower than the amounts in respect of
such
Inventory in the monthly
aging reports
submitted to the
Collateral
Agent,
the
difference
between
such amounts
shall be excluded
from the
calculation
of Eligible
Inventory
and (ii) to the extent that PALCO does
not own an Equity Interest in Britt, no Inventory of Britt shall
constitute
Eligible Inventory.
If any
Inventory
at any time ceases to be Eligible
Inventory,
such
Inventory
shall
promptly be
excluded
from the
calculation
of Eligible
Inventory.
"Excluded Taxes" shall mean, with respect to any Agent, any Lender,
or
any other
recipient
of any
payment
to be made by or on
account
of any
obligation
of the Borrowers
hereunder,
(a) taxes imposed on (or measured
by) its net income as a result of a connection
between such
recipient and
the jurisdiction
imposing such tax (or any political subdivision thereof),
other than any such
connection
arising solely from such recipient
having
executed,
delivered or
performed
its
obligations
or received a payment
under,
or enforced,
this
Agreement or any other Loan Document and (b) in
the case of a Foreign Lender (other than an assignee
pursuant to a request
by the
Administrative
Borrower under Section 2.21(a)),
any United States
withholding
tax that is imposed on amounts
payable to such Foreign Lender
at the time
such
Foreign
Lender
becomes a party to this
Agreement
(or
designates
a new
lending
office)
or is
attributable
to
such
Foreign
Lender's failure to comply with Section 2.20(d),
except to the extent that
such Foreign Lender (or its assignor,
if any) was entitled, at the time of
designation of a new lending office (or assignment),
to receive additional
amounts from PALCO with respect to such withholding tax pursuant to
Section
2.20(a).
"Federal Funds
Effective
Rate" shall mean, for any day, the weighted
average
(rounded
upwards,
if necessary,
to the next 1/100 of 1%) of the
rates on overnight
Federal funds
transactions with members of the Federal
Reserve System arranged by Federal funds brokers,
as published on the next
succeeding
Business Day by the Federal
Reserve
Bank of New York,
or, if
such
rate is not so
published
for any day that is a
Business
Day,
the
average
(rounded
upwards,
if necessary,
to the next 1/100 of 1%) of the
quotations
for the day for such
transactions
received by the
Collateral
Agent from three Federal funds brokers of recognized
standing
selected by
it.
"Fees" shall mean the Commitment Fees, the Administrative
Agent Fees,
the Collateral Agent Fees and the Issuing Bank Fees.
"Issuing Bank" shall mean, LaSalle Bank National
Association,
in its
capacity as the issuer of Letters of Credit.
"L/C
Exposure"
shall mean, at any time, the sum of (a) the aggregate
undrawn
amount of all Letters of Credit at such time and (b) the aggregate
amount of all unreimbursed payments and disbursements under such
Letters of
Credit. The L/C Exposure of any Lender at any time shall equal its
Pro Rata
Percentage of the aggregate L/C Exposure at such time.
"Lenders"
shall mean (a) the persons that
deliver a Lender
Addendum
(other than any such person that has ceased to be a party
hereto
pursuant
to an Assignment
and
Acceptance),
(b) any person that has become a party
hereto
pursuant to an Assignment
and
Acceptance,
and (c) the Collateral
Agent; provided, that such designation with respect to the
Collateral Agent
is solely
for
purposes
of
enabling
its claims
against
under the Loan
Documents
to be secured by liens
under the
Security
Documents,
and the
Collateral
Agent shall have no other rights or
obligations
as a "Lender"
under
the Loan
Documents,
including
rights
to
approve
or
disapprove
amendments or
modifications or rights to receive payments from collateral,
except
in
accordance
with
Section
6.5 of the
Guarantee
and
Security
Agreement or except as otherwise set forth in such Loan Document.
. Unless
the
context
otherwise
requires,
the term
"Lenders"
shall
include the
Swingline
Lender and the Issuing
Bank to the extent that LaSalle Bank (or
any Successor
Issuing Bank) may have rights or
obligations in addition to
those of the other Lenders due to its status as Issuing Bank.
"Letter of Credit"
shall
have the
meaning
assigned
to such term in
Section 2.01 (b).
"LIBO Rate" shall mean,
with respect to any Eurodollar
Borrowing for
any Interest Period,
the rate per annum determined by the Collateral Agent
at approximately
11:00 a.m., London time, on the date that is two Business
Days prior to the
commencement of such Interest Period by reference to the
British
Bankers'
Association
Interest
Settlement
Rates for deposits in
dollars (as set forth by the Bloomberg Information Service or any
successor
thereto or any other
service
selected by the
Collateral
Agent which has
been
nominated
by
the
British
Bankers'
Association
as an
authorized
information
vendor for the purpose of displaying
such rates) for a period
equal
to such
Interest
Period;
provided
that,
to the
extent
that an
interest rate is not ascertainable
pursuant to the foregoing provisions of
this
definition,
the "LIBO
Rate"
shall be the
interest
rate per annum
determined by the Collateral Agent to be the average of the rates
per annum
at which deposits in dollars are offered for such relevant
Interest Period
to major
banks in the London
interbank
market in London,
England by the
Collateral Agent at approximately 11:00 a.m. (London time) on the
date that
is two Business Days prior to the beginning of such Interest
Period.
"Loan
Documents"
shall mean this
Agreement,
the
Master
Letter of
Credit
Agreement and the Security
Documents.
"Material
Adverse
Effect"
shall mean a material
adverse
condition or material
adverse change in or
materially affecting (a) the business, assets,
liabilities,
operations or
condition
(financial
or
otherwise)
or
prospects
of
PALCO
and
the
Subsidiaries,
taken as a whole, or (b) the validity or
enforceability
of
any of the Loan
Documents or the rights and remedies of the Arranger,
the
Collateral
Agent,
the
Administrative
Agent,
or
the
Secured
Parties
thereunder.
"Material
Adverse Effect" shall mean a material adverse
condition or
material
adverse
change
in or
materially
affecting
(a) the
business,
assets,
liabilities,
operations or condition
(financial or otherwise) or
prospects
of PALCO
and the
Subsidiaries,
taken
as a whole,
or (b) the
validity or
enforceability
of any of the Loan Documents or the rights and
remedies of the Arranger,
the Collateral Agent, the Administrative
Agent,
or the Secured Parties thereunder.
"Net Cash
Proceeds"
shall mean (a) with respect to any Asset Sale or
Recovery
Event,
the proceeds
thereof in the form of cash
(including any
such proceeds
subsequently
received (as and when
received) in respect of
noncash
consideration
initially
received),
net of (i) selling
expenses
(including
reasonable and customary
broker's fees or
commissions,
legal
fees,
transfer
and
similar
taxes
incurred
by the
Borrowers
and
the
Subsidiaries in connection therewith and the Borrowers' good faith
estimate
of income taxes paid or payable in connection with such sale,
after taking
into account any available
tax credits or
deductions
and any tax sharing
arrangements),
(ii) amounts provided as a reserve, in accordance with GAAP
and
acceptable
to
each
Agent,
against
any
liabilities
under
any
indemnification
obligations or purchase price
adjustment
associated with
such
Asset
Sale
(provided
that,
to the extent and at the time any such
amounts are released from such reserve,
such amounts shall
constitute Net
Cash Proceeds),
(iii) the principal
amount,
premium or penalty,
if any,
interest and other amounts on any
Indebtedness for borrowed money which is
secured by the asset sold in such
Asset Sale and which is
required
to be
repaid with such proceeds
(other than
Indebtedness
hereunder or any such
Indebtedness assumed by the purchaser of such asset) and (iv) to
the extent
not otherwise included in clause (i) above, Capital Expenditures
associated
with the preparation and sale of non-core assets,
not to exceed $5,000,000
in the
aggregate;
and (b) with respect to any issuance or
disposition of
Indebtedness or any Equity Issuance,
the cash proceeds thereof, net of all
taxes and
reasonable
and
customary
fees,
commissions,
costs and other
expenses
incurred by the
Borrowers
and the
Subsidiaries
in
connection
therewith.
"Net Orderly
Liquidation
Value"
means at any time,
with respect to
Inventory,
the orderly liquidation value (expressed as a percentage of the
book value and on a non-conversion
basis), if any, of such Inventory (less
estimated liquidation expenses) at such time, as determined by
reference to
the most recent Appraisal thereof delivered to Collateral Agent
pursuant to
Section 5.04(k), which is reasonably satisfactory to Collateral
Agent.
"Prime Rate" shall mean the rate of interest per annum
announced from
time to time by JP Morgan
Chase
Bank,
N.A as its prime rate in effect at
its principal
office in New York City; each change in the Prime Rate shall
be
effective
as of the
opening of
business
on the date such
change is
announced as being
effective.
The Prime Rate is a reference rate and does
not necessarily represent the lowest or best rate actually
available.
"Reserves"
shall mean reserves that limit the
availability of credit
hereunder,
consisting
of
reserves
against
the
Commitments,
Eligible
Accounts or Eligible
Inventory,
established
by either Agent from time to
time in such
Agent's
reasonable
credit
judgment.
Without
limiting the
generality of the foregoing, the following reserves shall be deemed
to be a
reasonable
exercise of each
Agent's
credit
judgment:
(a) a reserve for
accrued,
unpaid
interest on the
Obligations,
(b)
reserves
for rent at
leased
locations
subject to statutory or contractual
landlord liens, (c)
reserves for any lumberman's liens,
logger's liens or other priming liens,
(d)
Inventory
shrinkage,
(e)
environmental
compliance
reserves,
(f)
dilution, and (g) warehousemen's or bailees' charges.
"Statutory
Reserves" shall mean a fraction
(expressed as a decimal),
the
numerator of which is the number one and the
denominator
of which is
the number
one minus the
aggregate
of the
maximum
reserve
percentages
(including
any
marginal,
special,
emergency or
supplemental
reserves)
expressed
as a decimal
established
by the
Board
and any other
banking
authority, domestic or foreign, to which any Agent or any Lender
(including
any branch, Affiliate or other fronting office making or holding a
Loan) is
subject for eurocurrency
funding
(currently
referred to as "Eurocurrency
Liabilities"
in
Regulation
D of the
Board).
Eurodollar
Loans shall be
deemed to constitute eurocurrency funding and to be subject to such
reserve
requirements
without
benefit of or credit for
proration,
exemptions
or
offsets
that may be
available
from time to time to any Lender under such
Regulation D or any
comparable
regulation.
Statutory
Reserves
shall be
adjusted automatically on and as of the effective date of any
change in any
reserve percentage.
"Swingline
Lender" shall mean
LaSalle,
in its capacity as lender of
Swingline Loans hereunder.
SECTION
3.2
The
definition
of
each
of
"Fee
Letter,"
"L/C
Disbursement,"
"L/C Fee Payment
Date," "L/C Guaranty Fee," and "Letter of
Credit
Guaranty"
set forth in Section
1.01 of the Credit
Agreement
are
hereby deleted their entirety.
SECTION 3.3 Article II of the Credit
Agreement is hereby
amended and
restated in its entirety to read as follows:
"ARTICLE II
THE CREDITS
SECTION 2.01 Commitments.
(a) Subject to the terms and
conditions
hereof and relying upon
the
representations
and
warranties
set forth
herein,
each Lender
agrees,
severally and not jointly, to make Loans to the Borrowers, at
any time and from time to time on or after the Closing
Date and until
the earlier of the Maturity Date and the termination of the
Commitment
of such Lender in accordance
with the terms
hereof,
in an aggregate
principal
amount at any time
outstanding that (i) will not result in
such
Lender's
Revolving
Credit
Exposure
exceeding
such
Lender's
Revolving Credit
Commitment and (ii) will not result in the Aggregate
Revolving Credit Exposure exceeding the Borrowing Base, subject to
the
Administrative Agent's authority, to make Protective Advances
pursuant
to the terms of
Section
2.24.
Within the limits set forth in clause
(ii) of the
preceding
sentence and subject to the terms,
conditions
and
limitations
set forth herein,
the Borrowers may borrow,
pay or
prepay and reborrow Loans.
(b) L/C
Commitment.
Subject to Section
2.23,
the Issuing Bank
agrees to issue letters of credit,
in each case containing such terms
and
conditions as are permitted by this
Agreement and are reasonably
satisfactory to the Issuing Bank (each, a "Letter of Credit"),
at the
request
of and for the
account
of the
Borrowers
from time to time
before the Maturity Date and, as more fully set forth in Section
2.23,
each Lender agrees to purchase a participation
in each such Letter of
Credit;
provided that (a) the aggregate
Stated Amount of all Letters
of
Credit
shall
not at any
time
exceed $
20,000,000
and (b) the
Aggregate
Revolving
Credit Exposure shall not at any time exceed the
Borrowing Availability.
SECTION 2.02 Loans.
(a) Each Loan (other than Swingline
Loans) shall be made as part
of a
Borrowing
consisting
of
Loans of the
same
Type
made by the
Lenders
ratably
in
accordance
with their
respective
Commitments;
provided,
however,
that the
failure
of any Lender to make any Loan
required to be made by it shall not in itself relieve any other
Lender
of its
obligation to lend
hereunder (it being
understood,
however,
that no
Lender
shall be
responsible
for the
failure
of any other
Lender to make any Loan
required
to be made by such
other
Lender).
Except for Loans
deemed made
pursuant to Section
2.02(f) or Section
2.24,
and subject to Section 2.22
relating to Swingline
Loans,
the
Loans
comprising
any
Borrowing
shall be in an aggregate
principal
amount that is (i) an integral
multiple of $250,000 and not less than
$750,000
or (ii)
equal to the
remaining
available
balance
of the
applicable Commitments.
(b) Subject to Sections 2.08, 2.15 and 2.24, each Borrowing shall
be
comprised
entirely
of
ABR
Loans
or
Eurodollar
Loans
as the
Administrative Borrower may request pursuant to Section 2.03;
provided
that all
Borrowings
made on the
Closing
Date and during the period
ending seven days
thereafter
must be made as ABR Borrowings (and may
not be
converted
into
Eurodollar
Borrowings
until the end of such
seven-day
period),
and
no
Borrowings
may
be
converted
into
or
continued
as a
Eurodollar
Borrowing
having an
Interest
Period in
excess
of one
month
prior to the date
which is 60 days
after
the
Closing Date.
Each Lender may at its option make any Eurodollar
Loan
by causing any domestic or foreign
branch or Affiliate of such Lender
to make such Loan; provided that any exercise of such option shall
not
affect
the
obligation
of
the
Borrowers
to
repay
such
Loan
in
accordance with the terms of this
Agreement.
Borrowings of more than
one Type may be outstanding at the same time; provided,
however, that
the
Administrative
Borrower
shall not be
entitled
to request
any
Borrowing that, if made, would result in more than five (5)
Eurodollar
Borrowings
outstanding
hereunder
at any time.
For
purposes of the
foregoing, Borrowings having different Interest Periods, regardless
of
whether they commence on the same date,
shall be considered
separate
Borrowings.
(c) Except with respect to Loans made pursuant to Section 2.02(f)
or Section
2.24 and subject to Section
2.22
relating
to
Swingline
Loans,
each Lender shall make each Loan to be made by it hereunder on
the proposed
date thereof by wire transfer of
immediately
available
funds to such account in New York City as the Administrative Agent
may
designate
not later
than 2:00
p.m.,
New York
City
time,
and the
Administrative
Agent shall promptly credit the amounts so received to
an account in the name of the applicable
Borrower,
designated by the
Administrative
Borrower in the applicable
Borrowing Request or, if a
Borrowing shall not occur on such date because any condition
precedent
herein
specified
shall not have
been met,
return
the
amounts
so
received to the respective Lenders.
(d) Unless the
Administrative
Agent shall have received
notice
from a Lender prior to the date of any Borrowing that such Lender
will
not make available to the
Administrative
Agent such Lender's portion
of such
Borrowing,
the
Administrative
Agent may
assume
that such
Lender has made such portion available to the Administrative
Agent on
the date of such
Borrowing in accordance
with
paragraph (c) of this
Section
and the
Administrative
Agent
may,
in
reliance
upon such
assumption,
make
available
to
the
Borrowers
on
such
date
a
corresponding
amount. If the Administrative
Agent shall have so made
funds
available
then,
to the extent that such Lender shall not have
made such portion available to the
Administrative
Agent, such Lender
and the Borrowers severally agree to repay to the Administrative
Agent
forthwith on demand such
corresponding
amount together with interest
thereon,
for each day from the date such amount is made
available to
the
Borrowers to but
excluding the date such amount is repaid to the
Administrative Agent at (i) in the case of the Borrowers, the
interest
rate applicable at the time to the Loans
comprising such Borrowing or
(ii)
in
the
case
of
such
Lender,
a
rate
determined
by
the
Administrative
Agent to represent its cost of overnight or short term
funds (which determination shall be conclusive absent manifest
error).
If
such
Lender
shall
repay
to
the
Administrative
Agent
such
corresponding
amount, such amount shall constitute such Lender's Loan
as part of such Borrowing for purposes of this Agreement.
(e)
Notwithstanding
any other provision of this Agreement,
the
Administrative Borrower shall not be entitled to request any
Borrowing
if the Interest Period
requested with respect thereto would end after
the Maturity Date.
SECTION 2.03 Borrowing Procedure. In order to request a Borrowing
(other than a Swingline Loan or a deemed Borrowing pursuant to
Section
2.02(f)
or Section
2.24,
as to which
this
Section
2.03 shall not
apply), the
Administrative
Borrower shall hand deliver or fax to the
Collateral Agent a duly completed Borrowing Request (a) in the case
of
a Eurodollar Borrowing,
not later than 2:00 p.m., New York City time,
three Business Days before a proposed Borrowing and (b) in the case
of
an ABR
Borrowing,
not later than 2:00 p.m.,
New York City time, one
Business Day before a proposed Borrowing. Each Borrowing Request
shall
be irrevocable,
shall be signed by or on behalf of the Administrative
Borrower and shall specify the following information:
(i) whether the
Borrowing then being
requested is to be a Eurodollar
Borrowing or an
ABR
Borrowing;
(ii) the
date of such
Borrowing
(which
shall be a
Business
Day);
(iii) the number and location of the account to which
funds are to be disbursed
(which
shall be an account
that
complies
with the
requirements
of Section
2.02(c));
(iv) the amount of such
Borrowing;
(v) if such Borrowing is to be a Eurodollar Borrowing, the
initial Interest Period with respect thereto and (vi) a Borrowing
Base
Certificate as of such date; provided,
however, that, notwithstanding
any contrary
specification in any Borrowing
Request,
each requested
Borrowing
shall
comply
with the
requirements
set forth in Section
2.02.
If no election as to the Type of
Borrowing is specified in any
such notice,
then the requested
Borrowing shall be an ABR Borrowing.
If no Interest
Period with
respect to any
Eurodollar
Borrowing
is
specified in any such notice,
then the Administrative
Borrower shall
be deemed to have selected an Interest Period of one month's
duration.
The Collateral
Agent shall promptly advise the applicable
Lenders of
any
notice
given in
accordance
with
this
Section
2.03
(and the
contents
thereof),
and of each
Lender's
portion
of the
requested
Borrowing.
SECTION 2.04 Repayment of Loans; Evidence of Debt.
(a) The Borrowers
hereby
unconditionally
promise to pay to the
Collateral
Agent
for the
account
of each
Lender
the then
unpaid
principal
amount of each Loan of such Lender made to the Borrowers on
the Maturity Date. The Borrowers hereby unconditionally promise to
pay
to the
Swingline
Lender
the then
unpaid
principal
amount of each
Swingline
Loan made to the Borrowers on the Maturity Date or the last
day of each calendar month.
(b) Each
Lender
shall
maintain
in
accordance
with its usual
practice an account or accounts
evidencing
the
indebtedness
of the
Borrowers to such Lender
resulting from each Loan made by such Lender
to the Borrowers from time to time, including the amounts of
principal
and
interest
payable and paid to such Lender from time to time under
this Agreement.
(c) The Collateral Agent shall maintain accounts in which it will
record (i) the amount of each Loan made
hereunder,
the Type
thereof
and the Interest
Period
applicable
thereto,
(ii) the amount of any
principal
or
interest
due and
payable or to become due and payable
from the
Borrowers to each Lender
hereunder
and (iii) the amount of
the sum received by the Collateral
Agent hereunder from the Borrowers
or any Guarantor and each Lender's share thereof.
(d) The
entries
made in the
accounts
maintained
pursuant
to
paragraphs
(b) and (c) of this Section shall be prima facie
evidence
of the
existence
and amounts of the
obligations
therein
recorded;
provided,
however,
that the
failure
of any
Lender or any Agent to
maintain
such
accounts or any error
therein shall not in any manner
affect the obligations of the Borrowers to repay the Loans made to
the
Borrowers in accordance with the terms of this Agreement.
(e) Any Lender may
request
that Loans made by it
hereunder
be
evidenced by a promissory
note. In such event,
the
Borrowers
shall
execute and deliver to such Lender a
promissory
note payable to such
Lender
and
its
registered
assigns
and
in a
form
and
substance
reasonably
acceptable to the Collateral
Agent.
Notwithstanding
any
other
provision
of this
Agreement,
in the event any
Lender
shall
request and receive such a promissory note, the interests
represented
by such note shall at all times (including after any assignment of
all
or part of such interests
pursuant to Section 9.04) be represented by
one or more promissory notes payable to the payee named therein or
its
registered assigns.
SECTION 2.05 Fees.
(a) The
Borrowers
agree
to pay to
each
Lender,
through
the
Collateral
Agent,
on the last Business Day of each calendar month in
each
year and on each
date on which any
Commitment
of such
Lender
shall expire or be terminated as provided
herein, a commitment fee (a
"Commitment
Fee")
equal to the
Commitment
Fee Rate on the
average
daily unused
amount of the
Commitment of such Lender (other than the
Swingline
Commitment)
during the
preceding
month (or other
period
commencing
with the date hereof or ending with the
Maturity
Date or
the date on which the
Commitments
of such Lender
shall expire or be
terminated). All Commitment Fees shall be computed on the basis of
the
actual
number of days elapsed in a year of 360 days.
The
Commitment
Fee due to each Lender shall commence to accrue on the date hereof
and
shall
cease to
accrue on the date on which
the
Commitment
of such
Lender shall expire or be terminated as provided herein.
For purposes
of calculating Commitment Fees, no portion of the Commitments shall
be
deemed
utilized
under
Section
2.22
as
a
result
of
outstanding
Swingline Loans.
(b) The Borrowers
agree to pay to the
Administrative
Agent and
the Arranger,
for its own account, the fees in the amounts and at the
times from time to time agreed to in writing by the
Borrowers (or any
Affiliate) and the
Administrative
Agent,
including
pursuant to the
Administrative
Fee Letter
(the
"Administrative
Agent
Fees").
The
Borrowers agree to pay to the Collateral
Agent,
for its own account,
the fees in the
amounts
and at the times from time to time agreed to
in writing by the
Borrowers
(or any
Affiliate)
and the
Collateral
Agent,
including
pursuant
to the
Collateral
Agent Fee Letter (the
"Collateral Agent Fees").
(c) The Borrowers
agree to pay to the
Collateral
Agent for the
account
of each
Lender a letter
of
credit
fee for each
Letter of
Credit
equal to the L/C Fee Rate in effect
from time to time of such
Lender's Pro Rata
Percentage
(as adjusted
from time to time) of the
undrawn
amount
of such
Letter of Credit
(computed
for the
actual
number of days
elapsed on the basis of a year of 360 days);
provided
that, upon the election of either Agent or the Required
Lenders,
the
rate
applicable
to each Letter of Credit shall be increased by 2% at
any time that an Event of Default exists
(without
duplication of any
default
interest charge imposed on such letter of credit fee, if any,
pursuant to Section 2.07).
Such letter of credit fee shall be payable
in arrears on the last day of each calendar quarter and on the
earlier
of the Maturity Date or the
termination
of all the
Commitments
(or
such
later
date
on
which
such
Letter
of
Credit
expires
or is
terminated)
for the
period
from
the date of the
issuance
of each
Letter of Credit
(or the last day on which the
letter of credit
fee
was paid with respect
thereto) to the date such payment is due or, if
earlier,
the date on which
such
Letter
of
Credit
expired
or was
terminated.
In addition,
with respect to each Letter of Credit,
the
Borrowers
agree to pay to the Issuing Bank, for its own account,
(i)
such fees and
expenses as the Issuing
Bank
customarily
requires in
connection
with
the
issuance,
negotiation,
processing
and/or
administration
of letters of credit in similar
situations and (ii) a
letter of credit fronting fee in the amount and at the times agreed
to
by the Borrowers and the Issuing Bank (clause (i) and (ii) referred
to
herein collectively, as the "Issuing Bank Fees").
(d) If,
on or prior to the
second
anniversary
of the
Closing
Date,
the
Revolving
Credit
Commitment
of any Lender is reduced or
terminated, the Borrowers agree to pay to the Collateral Agent for
the
benefit of such Lender on the date of such
reduction or termination a
fee equal to the Applicable
Percentage (as defined below)
multiplied
by the
amount
of
each
reduction
(or
the
entire
amount
of such
Revolving Credit Commitment in the event of a termination thereof).
As
used herein,
the term "Applicable
Percentage"
shall mean (w) 3%, in
the
case
of a
reduction
or
termination
of the
Revolving
Credit
Commitment on or prior to the first
anniversary
of the Closing Date,
(x) 2%, in the case of a reduction
or
termination
of the
Revolving
Credit
Commitment after the first anniversary of the Closing Date but
on or prior to the second anniversary thereof, (y) 1% in the case
of a
reduction or termination of the Revolving Credit
Commitment after the
second
anniversary
of the
Closing
Date or on or prior to the third
anniversary
of the
Closing
Date,
and
(z)
0%,
in the
case
of a
prepayment after the third anniversary of the Closing Date.
(e) All
Fees
shall be paid on the
dates
due,
in
immediately
available funds, to the Collateral Agent for
distribution,
if and as
appropriate,
among the
Lenders,
except that the
Issuing
Bank Fees
shall be paid for the account of the Issuing Bank.
Once paid, none of
the Fees shall be refundable under any circumstances.
SECTION 2.06 Interest on Loans.
(a)
Subject
to
the
provisions
of
Section
2.07,
the
Loans
comprising each ABR Borrowing,
including each Swingline
Loan,
shall
bear
interest
(computed
on the basis of the
actual
number of days
elapsed
over a year of 360
days)
at a rate per
annum
equal to the
Alternate Base Rate plus the Applicable
Margin in effect from time to
time.
(b)
Subject
to
the
provisions
of
Section
2.07,
the
Loans
comprising each Eurodollar
Borrowing shall bear interest (computed on
the
basis of the
actual
number of days
elapsed
over a year of 360
days) at a rate per
annum
equal to the
Adjusted
LIBO
Rate for the
Interest
Period
in effect
for such
Borrowing
plus the
Applicable
Margin in effect from time to time.
(c)
Interest
on each
Loan
shall be
payable
on the
Interest
Payment Dates applicable to such Loan except as otherwise
provided in
this
Agreement.
The applicable
Alternate Base Rate or Adjusted LIBO
Rate for each Interest Period or day within an Interest Period, as
the
case may be, shall be determined
by the
Collateral
Agent,
and such
determination shall be conclusive absent manifest error.
SECTION
2.07
Default
Interest.
If an
Event
of
Default
has
occurred and is continuing and either Agent or the Required Lenders
so
elect,
the
Borrowers
shall on written
demand from time to time pay
interest,
to the extent permitted by law, on all Obligations,
to but
excluding
the
date of
actual
payment
(after
as
well
as
before
judgment)
at the
rate
otherwise
applicable
to Loans
pursuant
to
Section 2.06 plus 2.00% per annum.
SECTION 2.08
Alternate
Rate of Interest.
In the event,
and on
each occasion,
that prior to the
commencement of any Interest Period
for a
Eurodollar
Borrowing
(a)
the
Collateral
Agent
shall
have
determined
that
adequate
and
reasonable
means
do not
exist
for
determining the Adjusted LIBO Rate for such Interest Period or (b)
the
Collateral
Agent is advised by the Required Lenders in respect of the
Facility that the Adjusted LIBO Rate for such Interest Period will
not
adequately
and fairly
reflect the cost to such
Lenders of making or
maintaining
their Loans
included in such Borrowing for such Interest
Period, the Collateral Agent shall, as soon as practicable
thereafter,
give written or fax notice of such
determination to the Borrowers and
the
Lenders.
In the
event
of any
such
determination,
until
the
Collateral Agent shall have advised the Borrowers and the Lenders
that
the circumstances
giving rise to such notice no longer exist, (i) any
request by the
Administrative
Borrower
for a
Eurodollar
Borrowing
pursuant
to Section
2.03 or 2.10 shall be deemed to be a request for
an ABR Borrowing and (ii) any Interest
Period
election that requests
the conversion of any Borrowing to, or
continuation
of any Borrowing
as, a Eurodollar Borrowing shall be ineffective. Each determination
by
the
Collateral
Agent
under this
Section
2.08 shall be
conclusive
absent manifest error.
SECTION 2.09 Termination and Reduction of Commitments.
(a) Unless
previously
terminated in
accordance
with the terms
hereof, the Commitments shall automatically
terminate on the Maturity
Date.
Notwithstanding
the
foregoing,
all
the
Commitments
shall
automatically
terminate at 5:00 p.m., New York City time, on
July 18, 2006, if the initial
Credit Event shall not have occurred by
such time.
Upon at least three Business Days' prior
irrevocable
written or
fax notice to the Collateral
Agent,
the Borrowers may at any time in
whole permanently terminate,
or from time to time in part permanently
reduce,
the
Commitments;
provided,
however,
that (i) each partial
reduction
of the
Commitments
shall be in an
integral
multiple
of
$1,000,000
and
in a
minimum
amount
of
$1,000,000
and
(ii)
the
Commitments
shall not be reduced
to an amount
that is less than the
Aggregate Revolving Credit Exposure then in effect.
(b) Each
reduction in the
Commitments
hereunder
shall be made
ratably among the applicable Lenders in accordance with their Pro
Rata
Percentages.
The Borrowers shall pay to the Collateral
Agent for the
account of the applicable
Lenders, on the date of each termination or
reduction,
the
Commitment
Fees on the amount of the
Commitments so
terminated
or
reduced
accrued
to but
excluding
the
date of such
termination or reduction.
SECTION 2.10
Conversion
and
Continuation
of
Borrowings.
The
Administrative
Borrower
shall
have the right at any time upon prior
irrevocable
notice to the
Collateral
Agent (a) not later than 12:00
p.m.,
New York City time,
one Business Day prior to
conversion,
to
convert
any
Eurodollar
Borrowing
of
the
Borrowers
into
an
ABR
Borrowing,
(b) not later
than 2:00 p.m.,
New York City time,
three
Business Days prior to conversion or continuation,
to convert any ABR
Borrowing of the Borrowers into a Eurodollar
Borrowing or to continue
any
Eurodollar
Borrowing of the Borrowers as a Eurodollar
Borrowing
for an
additional
Interest
Period and (c) not later than 2:00 p.m.,
New York City
time,
three
Business
Days
prior to
conversion,
to
convert the Interest
Period with respect to any Eurodollar
Borrowing
of the Borrowers to another
permissible
Interest Period,
subject in
each case to the following:
(i) each conversion or
continuation
shall be made pro rata
among the Lenders in
accordance
with the
respective
principal
amounts
of the
Loans
comprising
the
converted
or
continued
Borrowing;
(ii) if less than all the
outstanding
principal
amount of
any
Borrowing
shall
be
converted
or
continued,
then
each
resulting
Borrowing shall satisfy the
limitations
specified in
Sections
2.02(a) and 2.02(b)
regarding the principal amount and
maximum number of Borrowings of the relevant Type;
(iii) each
conversion
shall be effected by each Lender and
the Collateral
Agent by recording for the account of such Lender
the new Loan of such Lender
resulting
from such
conversion and
reducing
the Loan (or
portion
thereof)
of such
Lender
being
converted by an equivalent principal amount;
accrued interest on
any Eurodollar Loan (or portion thereof) being converted shall be
paid by the Borrowers at the time of conversion;
(iv) if any
Eurodollar
Borrowing
is
converted
at a time
other than the end of the Interest Period applicable thereto, the
Borrowers shall pay, upon demand,
any amounts due to the Lenders
pursuant to Section 2.16;
(v) any
portion of a
Borrowing
maturing or required to be
repaid
in less
than
one
month
may not be
converted
into or
continued as a Eurodollar Borrowing;
(vi) any portion of a
Eurodollar
Borrowing
that cannot be
converted
into or continued as a Eurodollar
Borrowing by reason
of
the
immediately
preceding
clause
shall
be
automatically
converted
at the end of the
Interest
Period in effect for such
Borrowing into an ABR Borrowing;
(vii) after the occurrence
and during the
continuance of a
Default or Event of Default, no outstanding Loan may be converted
into, or continued as, a Eurodollar Loan.
Each notice
pursuant to this Section
2.10 shall be
irrevocable
and shall refer to this
Agreement
and specify (i) the
identity
and
amount of the Borrowing that the
Administrative
Borrower
request be
converted or continued, (ii) whether such Borrowing is to be
converted
to or continued as a Eurodollar
Borrowing or an ABR Borrowing,
(iii)
if such
notice
requests a
conversion,
the date of such
conversion
(which
shall be a Business
Day) and (iv) if such
Borrowing is to be
converted
to or continued
as a
Eurodollar
Borrowing,
the Interest
Period with respect thereto. If no Interest Period is specified in
any
such notice with respect to any
conversion
to or
continuation
as a
Eurodollar Borrowing,
the Administrative
Borrower shall be deemed to
have
selected
an
Interest
Period
of
one
month's
duration.
The
Collateral Agent shall advise the Lenders of any notice given
pursuant
to this Section 2.10 and of each Lender's
portion of any converted or
continued
Borrowing.
If the
Administrative
Borrower shall not have
given
notice in
accordance
with this
Section
2.10 to continue any
Borrowing into a subsequent
Interest
Period (and shall not otherwise
have given notice in accordance with this Section 2.10 to convert
such
Borrowing),
such Borrowing
shall,
at the end of the Interest Period
applicable
thereto
(unless
repaid
pursuant
to the terms
hereof),
automatically be converted or continued into an ABR Borrowing.
SECTION 2.11 [Reserved]
SECTION 2.12 Prepayment.
(a) The Borrowers
shall,
subject to the requirements of Section
2.05(b),
have the
right at any time and from
time to time to prepay
any Borrowing, in whole or in part, upon at least three Business
Days'
prior written or fax notice (or telephone notice promptly confirmed
by
written or fax notice) in the case of Eurodollar
Loans, or written or
fax notice (or telephone
notice promptly
confirmed by written or fax
notice) at least one Business Day prior to the date of
prepayment
in
the case of ABR Loans,
to the Collateral
Agent before 2:00 p.m., New
York City time; provided,
however, that each partial prepayment shall
be in an amount that is an integral
multiple of $250,000 and not less
than $750,000.
(b) Each notice of prepayment
shall specify the prepayment
date
and the principal
amount of each Borrowing (or portion thereof) to be
prepaid, shall be irrevocable and shall commit the Borrowers to
prepay
such
Borrowing
by the
amount
stated
therein
on the
date
stated
therein.
All prepayments
under this Section 2.12 shall be subject to
Section
2.16,
but
otherwise
without
premium
or
penalty.
All
prepayments
under this Section 2.12 shall be
accompanied
by accrued
and
unpaid
interest
on the
principal
amount to be
prepaid to but
excluding the date of payment.
SECTION 2.13 Mandatory Prepayments.
(a) In the event of any termination of all the
Commitments,
the
Borrowers shall, on the date of such termination,
repay or prepay all
its outstanding Borrowings and all its outstanding Swingline Loans
and
replace
all its
outstanding
Letters
of Credit
and/or
shall
Cash
Collateralize
in full all
obligations
arising
with
respect to the
Letters
of Credit.
If as a result of any
partial
reduction
of the
Commitments the Aggregate
Revolving
Credit Exposure would exceed the
Commitments after giving effect thereto,
then the Borrowers shall, on
the date of such
reduction,
repay or prepay
Borrowings or Swingline
Loans (or a combination
thereof) and/or shall Cash
Collateralize
in
full all obligations
arising with respect to the Letters of Credit in
an amount sufficient to eliminate such excess.
(b) In the event and on each
occasion that
Aggregate
Revolving
Credit Exposure (other than amounts constituting
Protective Advances)
exceeds the Borrowing
Base,
the Borrowers
shall
immediately
repay
Loans and/or Cash Collateralize
outstanding
Letters of Credit to the
extent necessary to cause the Aggregate
Revolving Credit Exposure not
to exceed the Borrowing Base.
(c) In connection
with any Asset Sale which
consists of (i) the
sale of all of the
Equity
Interests
in
Britt
or (ii)
the sale of
Eligible Accounts and/or Eligible Inventory (or the sale of certain
of
such assets and other assets of a Borrower), the Borrowers shall
apply
the Net Cash
Proceeds
of such
sale to repay
outstanding
Revolving
Loans and/or shall Cash Collateralize in full all obligations
arising
with respect to the Letters of Credit in an amount equal to the
lesser
of (i) the amount
necessary
to cause the
Borrowers
to comply
with
Section
2.13(b)
or (ii) the sum of (a) 85% of the Net
Amount of the
Eligible
Accounts
sold in such
Asset Sale plus (b) 75% of the value
(being the lower of cost (on a first-in first out basis) or market)
of
the Eligible Inventory sold in such Asset Sale.
SECTION 2.14 Reserve Requirements; Change in Circumstances.
(a)
Notwithstanding
any other
provision of this
Agreement,
if any
Change in Law shall:
(i) impose,
modify or deem applicable any reserve,
special
deposit or similar
requirement
against assets of, deposits with
or for the account of, or credit
extended
by, any Lender or any
Agent (except any such reserve
requirement which is reflected in
the
Adjusted
LIBO
Rate) or
(ii)
(impose
on any
Lender
or any
Agent
or the
London
interbank market any other condition
affecting this Agreement or
Eurodollar
Loans made by such
Lender or any Letter of Credit or
participation
therein,
and the
result of any of the
foregoing
shall
be to
increase
the
cost to such
Lender
of
making
or
maintaining any Eurodollar Loan (or of maintaining its obligation
to make any such Loan) or to
increase
the cost to any Lender or
any
Agent of
issuing
or
maintaining
any
Letter of Credit or
Letter
of
Credit
Guaranty
or
purchasing
or
maintaining
a
participation therein or to reduce the amount of any sum received
or
receivable
by such Lender
hereunder
(whether of principal,
interest or otherwise) by an amount deemed by such Lender or such
Agent to be material,
then the Borrowers will pay to such Lender
or such Agent,
as the case may be,
upon demand such
additional
amount or amounts as will compensate
such Lender,
such Agent or
the Issuing Bank, as the case may be, for such
additional
costs
incurred or reduction suffered.
(b) If any Lender or any Agent shall have
determined
that any Change
in Law regarding
capital adequacy has or would have the effect of reducing
the rate of return
on such
Lender's
or such
Agent's
capital
or on the
capital of such
Lender's or such
Agent's
holding
company,
if any, as a
consequence
of this Agreement or the Loans made by, or
participations
in
Letters of Credit
purchased
by,
such
Lender to a level below that which
such Lender,
any Agent or such
Lender's or such Agent's
holding
company
could have
achieved but for such Change in Law (taking into
consideration
such Lender's or such Agent's policies and the policies of such
Lender's or
such Agent's holding company with respect to capital adequacy) by
an amount
deemed by such Lender or such Agent to be material,
then from time to time
the Borrowers
shall pay to such Lender or such Agent,
as the case may be,
such
additional
amount or amounts as will
compensate such Lender or such
Agent
or such
Lender's
or such
Agent's
holding
company
for any
such
reduction suffered.
(c) A certificate of a Lender or any Agent setting forth the amount
or
amounts
necessary to
compensate
such Lender or such Agent or its holding
company,
as
applicable,
as
specified
in
paragraph
(a) or (b) of this
Section 2.14 shall be delivered to the
Borrowers
and shall be
conclusive
absent manifest
error.
The Borrowers shall pay such Lender or such Agent,
as the
case
may be,
the
amount
or
amounts
shown
as due on any
such
certificate delivered by it within 10 days after its receipt of the
same.
(d)
Failure or delay on the part of any Lender or any Agent to demand
compensation pursuant to this Section shall not constitute a waiver
of such
Lender's or the such Agent's
right to demand such
compensation;
provided
that the Borrowers
shall not be under any
obligation
to
compensate
any
Lender or any Agent under paragraph (a) or (b) above for increased
costs or
reductions
with
respect to any period
prior to the date that is 180 days
prior to such request if such Lender or such Agent knew or could
reasonably
have
been
expected
to
know
of the
circumstances
giving
rise to such
increased costs or reductions and of the fact that such
circumstances would
result in a claim for increased
compensation
by reason of such
increased
costs or reductions;
provided further that the foregoing
limitation shall
not
apply
to
any
increased
costs
or
reductions
arising
out
of the
retroactive
application
of any Change in Law within such 180-day
period.
The
protection
of this Section shall be available to each Lender and each
Agent
regardless
of
any
possible
contention
of
the
invalidity
or
inapplicability
of the
Change in Law that
shall
have
occurred
or been
imposed.
SECTION 2.15 Change in Legality.
(a)
Notwithstanding
any other
provision of this
Agreement,
if any
Change in Law shall make it unlawful for any Lender to make or
maintain any
Eurodollar Loan or to give effect to its obligations as
contemplated hereby
with
respect
to any
Eurodollar
Loan,
then,
by
written
notice to the
Administrative Borrower and to the Collateral Agent:
(i) such
Lender
may
declare
that
Eurodollar
Loans
will not
thereafter
(for the
duration of such
unlawfulness)
be made by such
Lender hereunder (or be continued for additional
Interest Periods and
ABR Loans will not
thereafter
(for such
duration) be converted into
Eurodollar
Loans),
whereupon any request for a Eurodollar
Borrowing
(or to
convert
an ABR
Borrowing
to a
Eurodollar
Borrowing
or to
continue a Eurodollar
Borrowing
for an additional
Interest
Period)
shall, as to such Lender only, be deemed a request for an ABR Loan
(or
a request to continue an ABR Loan as such for an
additional
Interest
Period or to convert a Eurodollar
Loan into an ABR Loan,
as the case
may be), unless such declaration shall be subsequently withdrawn;
and
(ii) such
Lender may
require
that all
outstanding
Eurodollar
Loans made by it be
converted
to ABR Loans,
in which event all such
Eurodollar Loans shall be
automatically
converted to ABR Loans as of
the effective date of such notice as provided in paragraph (b)
below.
In the event any Lender
shall
exercise
its rights under (i) or (ii)
above,
all payments and prepayments of principal that would otherwise have
been
applied
to repay the
Eurodollar
Loans that would have been made by
such Lender or the converted
Eurodollar Loans of such Lender shall instead
be
applied
to repay
the ABR
Loans
made by such
Lender
in lieu of, or
resulting
from
the
conversion
of,
such
Eurodollar
Loans.
Any
such
conversion of a Eurodollar Loan under (i) above shall be subject to
Section
2.16.
(b) For purposes of this Section 2.15, a notice to the
Administrative
Borrower by any Lender shall be effective as to each
Eurodollar
Loan made
by such
Lender,
if lawful,
on the last day of the
Interest
Period then
applicable to such Eurodollar Loan; in all other cases such notice
shall be
effective on the date of receipt by the Borrowers.
SECTION 2.16
Indemnity.
The Borrowers
shall
indemnify
each Lender
against
any loss or expense
that such
Lender
may
sustain or incur as a
consequence
of (a) any event,
other than a default by such
Lender in the
performance of its obligations hereunder,
which results in (i) such Lender
receiving or being deemed to receive any amount on account of the
principal
of any
Eurodollar
Loan prior to the end of the Interest
Period in effect
therefor, (ii) the conversion of any Eurodollar Loan to an ABR
Loan, or the
conversion of the Interest
Period with respect to any Eurodollar
Loan, in
each
case
other
than on the last day of the
Interest
Period
in effect
therefor or (iii) any Eurodollar Loan to be made by such Lender
(including
any
Eurodollar
Loan to be made pursuant to a conversion
or
continuation
under
Section
2.10) not being made
after
notice of such Loan shall have
been
given by the
Administrative
Borrower
hereunder
(any of the events
referred to in this clause (a) being called a "Breakage
Event") or (b) any
default in the
making of any
payment or
prepayment
required
to be made
hereunder.
In the case of any Breakage
Event,
such loss shall include an
amount equal to the excess, as reasonably determined by such
Lender, of (i)
its cost of obtaining
funds for the Eurodollar Loan that is the subject of
such Breakage
Event for the period from the date of such Breakage Event to
the last day of the
Interest
Period in effect (or that would have been in
effect)
for such
Loan
over
(ii) the
amount
of
interest
likely to be
realized by such Lender in
redeploying
the funds released or not utilized
by reason of such
Breakage
Event for such period.
A
certificate
of any
Lender setting forth any amount or amounts which such Lender is
entitled to
receive
pursuant to this Section 2.16 shall be delivered to the
Borrowers
and shall be conclusive absent manifest error.
SECTION
2.17 Pro Rata
Treatment.
Except as
provided
below in this
Section 2.17 with respect to Swingline
Loans and as required under Section
2.15,
each
Borrowing,
each
payment or
prepayment
of
principal of any
Borrowing,
each
payment of
interest
on the Loans,
each
payment of the
Commitment
Fees,
each reduction of the Commitments and each conversion of
any
Borrowing to or
continuation
of any
Borrowing as a Borrowing of any
Type shall be allocated pro rata among the Lenders in accordance
with their
respective
applicable
Commitments
(or,
if such
Commitments
shall have
expired or been
terminated,
in accordance
with the respective
principal
amounts of their
outstanding
Loans).
For
purposes
of
determining
the
available
Revolving
Credit
Commitments of the Lenders at any time,
each
outstanding
Swingline
Loan shall be deemed to have utilized the Revolving
Credit
Commitments of the Lenders (including those Lenders which shall not
have made
Swingline
Loans) pro rata in
accordance
with such
respective
Revolving
Credit
Commitments.
Each Lender agrees that in computing
such
Lender's
portion of any
Borrowing to be made
hereunder,
the
Collateral
Agent may,
in its
discretion,
round
each
Lender's
percentage
of such
Borrowing to the next higher or lower whole dollar amount.
SECTION 2.18 Sharing of Setoffs.
Each Lender agrees that if it shall,
through the exercise of a right of banker's
lien,
setoff or
counterclaim
against the
Borrowers
or any other Loan
Party,
or pursuant to a secured
claim
under
Section
506 of Title 11 of the United
States
Code or other
security or interest
arising
from,
or in lieu of,
such
secured
claim,
received by such Lender
under any
applicable
bankruptcy,
insolvency
or
other
similar law or
otherwise,
or by any other
means,
obtain
payment
(voluntary or involuntary) in respect of any Loan or Loans or
participation
in all Letters of Credit as a result of which the unpaid principal
portion
of its
Loans
and
participations
in
all
Letters
of
Credit
shall
be
proportionately
less than the
unpaid
principal
portion of the Loans and
participations
in the Letters of Credit of any other
Lender,
it shall be
deemed
simultaneously
to have
purchased
from such other
Lender at face
value,
and shall promptly pay to such other Lender the purchase price for,
a participation in the Loans and L/C Exposure of such other Lender,
so that
the
aggregate
unpaid
principal
amount of the Loans and L/C Exposure and
participations
in Loans and L/C
Exposure
held by each Lender shall be in
the same proportion to the aggregate
unpaid
principal amount of all Loans
and L/C Exposure then
outstanding as the principal amount of its Loans and
L/C
Exposure
prior
to
such
exercise
of
banker's
lien,
setoff
or
counterclaim
or other event was to the
principal
amount of all Loans and
L/C Exposure outstanding prior to such exercise of banker's lien,
setoff or
counterclaim or other event;
provided,
however, that if any such purchase
or purchases or adjustments shall be made pursuant to this Section
2.18 and
the
payment
giving rise
thereto
shall
thereafter
be
recovered,
such
purchase or
purchases or
adjustments
shall be rescinded to the extent of
such
recovery
and the
purchase
price or prices or
adjustment
restored
without
interest.
The
Borrowers
expressly
consent
to
the
foregoing
arrangements
and agrees that any Lender holding a participation
in a Loan
or Letter of Credit
deemed to have been so purchased
may exercise any and
all rights of banker's lien, setoff or counterclaim with respect to
any and
all moneys owing by the Borrowers to such Lender by reason thereof
as fully
as if such Lender had made a Loan
directly to the
Borrowers in the amount
of such participation.
SECTION 2.19 Payments.
(a) The Borrowers shall make each payment
(including
principal of or
interest
on any
Borrowing
reimbursement
obligations
under a Letter
of
Credit or any Fees or other
amounts)
hereunder
and under any other
Loan
Document not later than 12:00 (noon),
placeCityNew
York City time, on the
date when due in immediately available dollars,
without setoff, defense or
counterclaim.
Each such payment
(other than
principal of and interest on
Swingline
Loans,
which
shall be paid
directly to the
Swingline
Lender
except as
otherwise
provided
in
Section
2.21(e))
shall be made to the
Collateral
Agent at its offices at
addressStreet135
S.
LaSalle
Street,
Suite
425,
CityChicago,
StateIllinois
PostalCode60603.
All
payments
hereunder and under each other Loan Document shall be made in
dollars.
(b)
Except as
otherwise
expressly
provided
herein,
whenever
any
payment (including principal of or interest on any Borrowing or any
Fees or
other amounts) hereunder or under any other Loan Document shall
become due,
or otherwise would occur, on a day that is not a Business Day, such
payment
may be made on the next succeeding Business Day, and such extension
of time
shall in such case be included in the
computation
of interest or Fees, if
applicable.
SECTION 2.20 Taxes.
(a) Any and all
payments
by or on account of any
obligation
of the
Borrowers
or any other
Loan
Party
hereunder
or under
any
other
Loan
Document
shall be made free and
clear of and
without
deduction
for any
Indemnified Taxes or Other Taxes; provided that if any Indemnified
Taxes or
Other Taxes are
required to be
withheld or deducted
from such
payments,
then (i) the sum payable by the
Borrowers
shall be increased as necessary
so that after all required deductions or withholding
(including deductions
or
withholdings
applicable to additional
sums payable under this Section
2.20) the Collateral Agent, the Administrative Agent or such Lender
(as the
case may be) receives an amount equal to the sum it would have
received had
no such
deductions
been made, (ii) the Borrowers or such other Loan Party
shall make (or cause to be made) such deductions and (iii) the
Borrowers or
such
other
Loan
Party
shall pay (or
cause to be paid) the full
amount
deducted
to
the
relevant
Governmental
Authority
in
accordance
with
applicable
law.
In
addition,
the
Borrowers
or any
other
Loan
Party
hereunder
shall pay (or cause to be paid) any Other Taxes to the
relevant
Governmental Authority in accordance with applicable law.
(b)
The
Borrowers
shall
indemnify
the
Collateral
Agent,
the
Administrative
Agent and each Lender,
within 10 days after written demand
therefor,
for the full amount of any Indemnified Taxes or Other Taxes paid
by the Collateral Agent or such Lender, as the case may be, or any
of their
respective
Affiliates,
on or with respect to any payment by or on account
of any
obligation
of any Loan
Party
hereunder
or under any other
Loan
Document (including Indemnified Taxes or Other Taxes imposed or
asserted on
or
attributable
to amounts payable under this Section) and any penalties,
interest and expenses arising therefrom or with respect thereto,
whether or
not such Indemnified Taxes or Other Taxes were correctly or legally
imposed
or asserted by the relevant Governmental Authority. A certificate
as to the
amount of such payment or liability delivered to the Borrowers by a
Lender,
or by the Collateral Agent on its behalf or on behalf of a Lender,
shall be
conclusive absent manifest error.
(c) As soon as practicable
after any payment of Indemnified
Taxes or
Other Taxes pursuant to Section 2.20(a), and in any event within 30
days of
any such payment
being due, the
Borrowers
shall
deliver (or cause to be
delivered)
to each Agent the
original
or a
certified
copy of a receipt
issued by such Governmental
Authority
evidencing such payment,
a copy of
the
return
reporting
such
payment
or other
evidence
of such
payment
reasonably satisfactory to the Collateral Agent.
(d) Any
Foreign
Lender
that is
entitled
to an
exemption
from or
reduction of withholding tax under the law of the jurisdiction in
which the
Borrowers is located,
or any treaty to which such jurisdiction is a party,
with
respect
to
payments
under
this
Agreement
shall
deliver
to the
Administrative
Borrower
(with a copy to each
Agent),
at the
reasonable
written request of the Administrative Borrower, such properly
completed and
executed
documentation
prescribed by
applicable
law as will permit such
payments to be made without withholding or at a reduced rate;
provided that
such Lender is legally
entitled
to
complete,
execute
and deliver
such
documentation and in such Lender's
judgment such completion,
execution or
delivery would not materially
prejudice the legal position of such Lender.
In addition,
each Foreign Lender shall (i) furnish on or before it becomes
a party to the
Agreement
either (a) two accurate and complete
originally
executed U.S.
Internal
Revenue Service Form W-8BEN (or successor form) or
(b) an accurate and complete U.S.
Internal Revenue Service Form W-8ECI (or
successor form), certifying, in either case, to such Foreign
Lender's legal
entitlement to an exemption or reduction from U.S. Federal
withholding tax
with respect to all
interest
payments
hereunder,
and (ii) provide a new
Form W 8BEN (or
successor
form) or U.S.
Internal
Revenue
Service
Form
W-8ECI (or
successor
form) upon the
expiration
or
obsolescence
of any
previously
delivered form to reconfirm any complete exemption from, or any
entitlement to a reduction in, U.S. Federal withholding tax with
respect to
any interest
payment
hereunder;
provided that any Foreign Lender that is
not a "bank" within the meaning of Section 881(c)(3)(A) of the Tax
Code and
is relying
on the
so-called
"portfolio
interest
exemption"
shall also
furnish a "Non-Bank
Certificate"
in the form of Exhibit G together with a
U.S.
Internal
Revenue
Service
Form W 8BEN.
Notwithstanding
any
other
provision
of this
paragraph,
a Foreign
Lender
shall not be required to
deliver any form pursuant to this paragraph that such Foreign
Lender is not
legally able to deliver.
(e) Any Lender that is a United States
person,
as defined in Section
7701(a)(30)
of the Tax Code,
and is not an exempt
recipient
within
the
meaning of Treasury
Regulations
Section
1.6049-4(c) shall deliver to the
Borrowers
(with a copy to each Agent) two accurate
and complete
original
signed copies of Internal
Revenue
Service Form W-9, or any successor form
that such
person is
entitled
to
provide at such time in order to comply
with United States back-up withholding requirements.
(f) Without
prejudice to the
survival of any other
agreement of the
Borrowers
hereunder,
the
agreements
and
obligations
of the
Borrowers
contained
in this
Section
2.20 shall
survive the payment in full of all
amounts due hereunder.
SECTION 2.21
Assignment of Commitments
Under Certain
Circumstances;
Duty to Mitigate.
(a) In the event (i) any
Lender
delivers
a
certificate
requesting
compensation
pursuant to Section 2.14,
(ii) any Lender
delivers a notice
described
in Section
2.15,
(iii) the
Borrowers
are required to pay any
additional amount to any Lender or any Governmental Authority on
account of
any Lender
pursuant to Section 2.20 or (iv) any Lender does not consent to
a proposed amendment, modification or waiver of this Agreement
requested by
the
Administrative
Borrower
which
requires
the
consent
of all of the
Lenders or all of the Lenders under any Facility to become
effective
(and
which is approved by at least the Required Lenders),
the Borrowers may, at
their sole expense and effort (including with respect to the
processing and
recordation fee referred to in Section 9.04(b)), upon notice to
such Lender
and each of the Agents, require such Lender to transfer and assign,
without
recourse (in accordance with and subject to the
restrictions
contained in
Section 9.04),
all of its
interests,
rights and
obligations
under this
Agreement to an assignee that shall assume such assigned
obligations (which
assignee
may be another
Lender,
if a Lender
accepts
such
assignment);
provided that (x) such assignment
shall not conflict with any law, rule or
regulation
or order of any court or other
Governmental
Authority
having
jurisdiction,
(y) solely with respect to replacements of Lenders
pursuant
to clauses (i),
(ii) or (iii) of this Section,
the
Borrowers
shall have
received
the
prior
written
consent
of each of the
Agents
(and,
if a
Revolving Credit
Commitment is being assigned,
of the Swingline
Lender),
which consent shall not unreasonably be withheld,
and (z) the Borrowers or
such
assignee
shall
have
paid to the
affected
Lender
in
immediately
available funds an amount equal to the sum of the principal of and
interest
accrued
to
the
date
of
such
payment
on
the
outstanding
Loans
or
participations
in all Letters of Credit of such Lender,
plus all Fees and
other amounts accrued for the account of such Lender
hereunder
(including
any amounts under Section 2.14 and Section 2.16); provided further
that, if
prior to any such transfer and assignment the
circumstances
or event that
resulted in such
Lender's
claim for
compensation
under
Section 2.14 or
notice under
Section 2.15 or the amounts paid pursuant to Section 2.20, as
the case may be,
cease to cause such Lender to suffer
increased
costs or
reductions
in amounts
received or
receivable
or
reduction in return on
capital,
or cease to have the
consequences
specified in Section 2.15, or
cease to result in amounts
being
payable
under Section 2.20, as the case
may be (including
as a result of any action taken by such Lender
pursuant
to paragraph
(b) below),
or if such Lender shall waive its right to claim
further compensation under Section 2.14 in respect of such
circumstances or
event or shall
withdraw its notice
under
Section 2.15 or shall waive its
right
to
further
payments
under
Section
2.20
in
respect
of
such
circumstances
or event,
as the case may be,
then such
Lender
shall not
thereafter be required to make any such transfer and assignment
hereunder.
In connection
with any such
replacement,
if the replaced Lender does not
execute and deliver to the Collateral Agent a duly completed
Assignment and
Acceptance
reflecting
such
replacement
within five Business Days of the
date on which the replacement
Lender executes and delivers such Assignment
and Acceptance to the replaced
Lender,
then such replaced Lender shall be
deemed to have executed and delivered such Assignment and
Acceptance.
(b) If (i) any Lender shall request
compensation
under Section 2.14,
(ii) any Lender
delivers a notice
described
in Section 2.15 or (iii) the
Borrowers
are required to pay any
additional
amount to any Lender or any
Governmental Authority on account of any Lender,
pursuant to Section 2.20,
then such Lender shall use reasonable efforts (which shall not
require such
Lender to incur an
unreimbursed
loss or
unreimbursed
cost or expense or
otherwise take any action
inconsistent with its internal policies or legal
or regulatory
restrictions or suffer any
disadvantage or burden deemed by
it to be significant)
(x) to file any
certificate or document
reasonably
requested
in writing by the
Administrative
Borrower or (y) to assign its
rights and delegate and
transfer its
obligations
hereunder to another of
its offices,
branches or
affiliates,
if such filing or assignment
would
reduce its
claims
for
compensation
under
Section
2.14 or enable it to
withdraw
its notice
pursuant
to
Section
2.15 or would
reduce
amounts
payable
pursuant to Section 2.20,
as the case may be, in the future.
The
Borrowers hereby agree to pay all reasonable costs and expenses
incurred by
any Lender in connection with any such filing or assignment,
delegation and
transfer.
SECTION 2.22 Swingline Loans.
(a) Swingline
Commitment.
Subject to the terms and conditions hereof
and relying upon the
representations
and warranties set forth herein, the
Swingline
Lender
agrees to make loans to the
Borrowers,
at any time and
from time to time
after the
Closing
Date,
and until the
earlier of the
Maturity Date and the termination of the Commitments in accordance
with the
terms hereof, in an aggregate principal amount at any time
outstanding that
will not
result in (i) the
aggregate
principal
amount of all
Swingline
Loans exceeding $2,000,000 in the aggregate or (ii) the Aggregate
Revolving
Credit Exposure,
after giving effect to any Swingline Loan,
exceeding the
Commitment.
Each Swingline Loan shall be in a principal
amount that is an
integral multiple of $100,000.
The Swingline
Commitment may be terminated
or reduced
from time to time as
provided
herein.
Within
the
foregoing
limits,
the
Borrowers
may borrow,
pay or prepay and reborrow
Swingline
Loans hereunder, subject to the terms, conditions and limitations
set forth
herein.
(b) Swingline
Loans.
The
Administrative
Borrower
shall notify the
Collateral Agent by fax, or by telephone (confirmed by fax), not
later than
11:00 a.m., New York City time, on the day of a proposed
Swingline Loan to
be made to it. Such notice shall be delivered on a Business
Day,
shall be
irrevocable
and
shall
refer to this
Agreement
and
shall
specify
the
requested date (which shall be a Business Day) and amount of such
Swingline
Loan. The Collateral Agent will promptly advise the Swingline
Lender of any
notice received from the Administrative Borrower pursuant to this
paragraph
(b). The Swingline
Lender shall make each
Swingline Loan available to the
Borrowers
by means of a
credit
to the
general
deposit
account
of the
Borrowers with the Swingline Lender by 3:00 p.m. on the date such
Swingline
Loan is so requested.
(c)
Prepayment.
The
Borrowers
shall have the right at any time and
from time to time to prepay any Swingline
Loan, in whole or in part,
upon
giving
written or fax notice (or telephone
notice
promptly
confirmed by
written or fax notice) to the Swingline
Lender and to the Collateral Agent
before 12:00
(noon),
New York City time, on the date of prepayment at the
Swingline
Lender's
address for notices
specified in the Lender
Addendum
delivered by the
Swingline
Lender.
All
principal
payments of Swingline
Loans shall be
accompanied
by accrued
interest on the
principal
amount
being repaid to the date of payment.
(d) Interest. Each Swingline Loan shall be an ABR Loan and, subject
to
the provisions of Section 2.07,
shall bear interest as provided in Section
2.06(a).
(e)
Participations.
The Swingline Lender may by written notice given
to the
Collateral
Agent not later than 10:00 a.m., New York City time, on
any
Business
Day require the
Lenders to acquire
participations
on such
Business Day in all or a portion of the Swingline Loans
outstanding.
Such
notice
shall
specify the
aggregate
amount of
Swingline
Loans in which
Lenders will participate.
The Collateral Agent will, promptly upon receipt
of such notice, give notice to each Lender,
specifying in such notice such
Lender's
Pro
Rata
Percentage
of
such
Swingline
Loan
or
Loans.
In
furtherance
of
the
foregoing,
each
Lender
hereby
absolutely
and
unconditionally agrees, upon receipt of notice as provided above,
to pay to
the
Collateral
Agent,
for the
account
of the
Swingline
Lender,
such
Lender's Pro Rata
Percentage of such Swingline Loan or Loans.
Each Lender
acknowledges
and agrees that its obligation to acquire
participations
in
Swingline
Loans pursuant to this
paragraph is absolute and
unconditional
and shall not be affected by any
circumstance
whatsoever,
including
the
occurrence and
continuance
of a Default or an Event of Default,
and that
each such payment shall be made without any offset, abatement,
withholding
or reduction whatsoever. Each Lender shall comply with its
obligation under
this paragraph by wire transfer of immediately available funds, in
the same
manner as provided in Section
2.02(c)
with
respect to Loans made by such
Lender (and Section 2.02(c) shall apply,
mutatis mutandis,
to the payment
obligations
of the Lenders
under this Section) and the
Collateral
Agen
