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Sample Business ContractsHome: Sample Business Contracts:
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Credit Agreement
Dated as of October 29, 1999
among
California Pizza Kitchen, Inc.,
The Financial
Institutions Party Hereto,
Bank of America, N.A.,
as Administrative Agent, Swing Line Lender
and
Letter of Credit Issuing Lender,
Banc of America Securities LLC,
as Sole Arranger and Sole Book Manager
and Bankers Trust Company, as Documentation Agent
[LOGO of Bank of America]
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<PAGE>
TABLE OF CONTENTS
Section Page
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SECTION 1. DEFINITIONS AND ACCOUNTING TERMS 1
1.01 Defined Terms................................................. 1
1.02 Use of Certain Terms.......................................... 24
1.03 Accounting Terms.............................................. 24
1.04 Rounding...................................................... 24
1.05 Exhibits and Schedules........................................ 25
1.06 References to Agreements and Laws............................. 25
SECTION 2. THE COMMITMENTS AND EXTENSIONS OF CREDIT....................... 25
2.01 Amount and Terms of Commitments............................... 25
2.02 Borrowings, Conversions and Continuations of Loans............ 26
2.03 Letters of Credit............................................. 27
2.04 Swing Line Loans.............................................. 31
2.05 Prepayments................................................... 33
2.06 Reduction or Termination of Revolving Commitments............. 34
2.07 Principal and Interest........................................ 34
2.08 Fees.......................................................... 35
2.09 Computation of Interest and Fees.............................. 35
2.10 Making Payments............................................... 35
2.11 Funding Sources............................................... 37
2.12 Master Subsidiary Guaranty and Collateral..................... 37
SECTION 3. TAXES, YIELD PROTECTION AND ILLEGALITY......................... 37
3.01 Taxes......................................................... 37
3.02 Illegality.................................................... 38
3.03 Inability to Determine Rates.................................. 38
3.04 Increased Cost and Reduced Return; Capital Adequacy........... 39
3.05 Breakfunding Costs............................................ 39
3.06 Matters Applicable to all Requests for Compensation........... 40
3.07 Survival...................................................... 41
SECTION 4. CONDITIONS PRECEDENT TO EXTENSIONS OF CREDIT................... 41
4.01 Conditions of Initial Extension of Credit..................... 41
4.02 Conditions to all Extensions of Credit........................ 43
SECTION 5. REPRESENTATIONS AND WARRANTIES................................. 44
5.01 Existence and Qualification; Power; Compliance with Laws...... 44
5.02 Power; Authorization; Enforceable Obligations................. 44
5.03 No Legal Bar.................................................. 45
5.04 Financial Statements; No Material Adverse Effect.............. 45
5.05 Litigation.................................................... 45
5.06 No Default.................................................... 45
5.07 Ownership of Property; Liens.................................. 46
5.08 Taxes......................................................... 46
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<PAGE>
5.09 Margin Regulations; Investment Company Act; Public Utility Holding
Company Act................................................... 46
5.10 No ERISA Plans................................................ 46
5.11 Intangible Assets............................................. 46
5.12 Compliance With Laws.......................................... 47
5.13 Environmental Compliance...................................... 47
5.14 Insurance..................................................... 47
5.15 Subsidiaries.................................................. 47
5.16 Year 2000..................................................... 47
5.17 Collateral.................................................... 48
5.18 Projections and Operating Budgets............................. 48
5.19 Disclosure.................................................... 48
SECTION 6. AFFIRMATIVE COVENANTS.......................................... 48
6.01 Financial Statements.......................................... 49
6.02 Certificates, Notices and Other Information................... 49
6.03 Payment of Taxes.............................................. 51
6.04 Preservation of Existence..................................... 51
6.05 Maintenance of Properties..................................... 51
6.06 Maintenance of Insurance...................................... 51
6.07 Compliance With Laws.......................................... 51
6.08 Inspection Rights............................................. 52
6.09 Keeping of Records and Books of Account....................... 52
6.10 Compliance With Agreements.................................... 52
6.11 Use of Proceeds............................................... 52
6.12 Additional Guarantors, Debtors and Collateral................. 52
6.13 Further Assurances............................................ 53
SECTION 7. NEGATIVE COVENANTS............................................. 53
7.01 Indebtedness.................................................. 54
7.02 Liens and Negative Pledges.................................... 54
7.03 Fundamental Changes........................................... 54
7.04 Dispositions.................................................. 55
7.05 Investments................................................... 55
7.06 Lease Obligations............................................. 55
7.07 Restricted Payments........................................... 56
7.08 ERISA......................................................... 56
7.09 Change in Nature of Business.................................. 56
7.10 Transactions with Affiliates.................................. 56
7.11 Capital Expenditures.......................................... 56
7.12 Financial Covenants........................................... 56
7.13 Change in Auditors............................................ 57
SECTION 8. EVENTS OF DEFAULT AND REMEDIES................................. 58
8.01 Events of Default............................................. 58
8.02 Remedies Upon Event of Default................................ 60
SECTION 9. ADMINISTRATIVE AGENT........................................... 61
9.01 Appointment and Authorization of Administrative Agent......... 61
9.02 Delegation of Duties.......................................... 62
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9.03 Liability of Administrative Agent............................. 62
9.04 Reliance by Administrative Agent.............................. 62
9.05 Notice of Default............................................. 63
9.06 Credit Decision; Disclosure of Information by Administrative
Agent......................................................... 63
9.07 Indemnification of Administrative Agent....................... 64
9.08 Administrative Agent in Individual Capacity................... 64
9.09 Successor Administrative Agent................................ 64
9.10 Proportionate Interest in any Collateral...................... 65
9.11 Documentation Agent........................................... 65
SECTION 10. MISCELLANEOUS................................................. 65
10.01 Amendments; Consents.......................................... 65
10.02 Transmission and Effectiveness of Communications and
Signatures.................................................... 66
10.03 Attorney Costs, Expenses and Taxes............................ 67
10.04 Binding Effect; Assignment.................................... 68
10.05 Set-off....................................................... 69
10.06 Sharing of Payments........................................... 70
10.07 No Waiver; Cumulative Remedies................................ 70
10.08 Usury......................................................... 71
10.09 Counterparts.................................................. 71
10.10 Integration................................................... 71
10.11 Nature of Lenders' Obligations................................ 71
10.12 Survival of Representations and Warranties.................... 72
10.13 Indemnity by Borrower......................................... 72
10.14 Nonliability of Lenders....................................... 72
10.15 No Third Parties Benefited.................................... 73
10.16 Severability.................................................. 73
10.17 Confidentiality............................................... 73
10.18 Further Assurances............................................ 74
10.19 Headings...................................................... 74
10.20 Time of the Essence........................................... 74
10.21 Foreign Lenders and Participants.............................. 74
10.22 Governing Law................................................. 75
10.23 Waiver of Right to Trial by Jury.............................. 76
10.24 Entire Agreement.............................................. 76
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<PAGE>
EXHIBITS
Form of
A Request for Extension of Credit
B Compliance Certificate
C-1 Revolving Note
C-2 Term Note
D Notice of Assignment and Acceptance
E Master Subsidiary Guaranty
F Security Agreement
G Pledge Agreement
H Joinder Agreement
SCHEDULES
2.01 Commitments and Pro Rata Shares
5.05 Material Litigation
5.11 Trademarks, Patents, Copyrights
5.15 Subsidiaries
7.01 Existing Indebtedness, Liens and Negative Pledges
10.02 Offshore and Domestic Lending Offices, Addresses for Notices
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<PAGE>
CREDIT AGREEMENT
This CREDIT AGREEMENT ("Agreement") is entered into as of October 29, 1999
---------
by and among CALIFORNIA PIZZA KITCHEN, INC., a California corporation
("Borrower"), each lender from time to time party hereto (collectively,
--------
"Lenders" and individually, a "Lender"), and BANK OF AMERICA, N.A., as
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Administrative Agent and Issuing Lender and BANKERS TRUST COMPANY, as
Documentation Agent.
RECITAL
Borrower has requested that Lenders and Issuing Lender provide a revolving
line of credit and term loans, and Lenders, Issuing Lender and Administrative
Agent are willing to do so on the terms and conditions set forth herein.
In consideration of the mutual covenants and agreements herein contained,
the parties hereto covenant and agree as follows:
SECTION 1.
DEFINITIONS AND ACCOUNTING TERMS
1.01 Defined Terms. As used in this Agreement, the following terms shall
have the meanings set forth below:
"Administrative Agent" means Bank of America, N.A., in its capacity as
--------------------
Administrative agent under any of the Loan Documents, or any successor
administrative agent.
"Administrative Agent's Office" means Administrative Agent's address and,
-----------------------------
as appropriate, account as set forth on Schedule 10.02, or such other address or
--------------
account as Administrative Agent hereafter may designate by written notice to
Borrower and Lenders.
"Administrative Agent-Related Persons" means Administrative Agent
------------------------------------
(including any successor agent), together with its Affiliates (including, in the
case of Administrative Agent, the Arranger), and the officers, directors,
employees, agents and attorneys-in-fact of such Persons and Affiliates.
"Affiliate" means any Person directly or indirectly controlling, controlled
---------
by, or under direct or indirect common control with, another Person. A Person
shall be deemed to be "controlled by" any other Person if such other Person
possesses, directly or indirectly, power (a) to vote 25% or more of the
securities (on a fully diluted basis) having ordinary voting power for the
election of directors or managing general partners; or (b) to direct or cause
the direction of the management and policies of such Person whether by contract
or otherwise.
"Agreement" means this Credit Agreement, as amended, restated, extended,
---------
supplemented or otherwise modified in writing from time to time.
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<PAGE>
"Applicable Amount" means the following amounts per annum, based upon the
-----------------
Leverage Ratio as set forth in the most recent Compliance Certificate received
by Administrative Agent pursuant to Section 6.02(b); provided, however, that,
--------------- -------- -------
until Administrative Agent receives the first Compliance Certificate after the
Closing Date, such amounts shall be those indicated for Pricing Level 2 set
forth below:
Applicable Amount
Offshore
Revolving Rate +
----------
Pricing Commitment Letters of Base Rate
Level Leverage Ratio fee Credit +
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1 *2.00:1 but **2.50:1 0.375 1.75 0.50
2 *1.50:1 but **2.00:1 0.375 1.50 0.25
3 **1.50:1 0.250 1.25 None
* Greater than or equal to
** Less than
The Applicable Amount shall be in effect from the date the most recent
Compliance Certificate is received by Administrative Agent to but excluding the
date the next Compliance Certificate is received; provided, however, that if
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Borrower fails to timely deliver the next Compliance Certificate, the Applicable
Amount from the date such Compliance Certificate was due to but excluding the
date such Compliance Certificate is received by Administrative Agent shall be
the highest pricing level set forth above, and, thereafter, the pricing level
indicated by such Compliance Certificate when received.
"Applicable Payment Date" means, (a) as to any Offshore Rate Loan, the last
-----------------------
day of the relevant Interest Period and any date that such Loan is prepaid or
converted in whole or in part and the Maturity Date; provided, however, that if
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any Interest Period for an Offshore Rate Loan exceeds three months, interest
shall also be paid on the date which falls every three months after the
beginning of such Interest Period, and (b) as to any other amount, the last
Business Day of each calendar quarter and the Maturity Date; provided, further,
-------- -------
that interest accruing at the Default Rate shall be payable from time to time
upon demand of Administrative Agent.
"Arranger" means Banc of America Securities LLC, in its capacity as sole
--------
arranger and sole book manager.
"Attorney Costs" means and includes all reasonable fees and disbursements
--------------
of any law firm or other external counsel and the reasonable allocated cost of
internal legal services and all reasonable disbursements of internal counsel.
"Audited Financial Statements" means the audited consolidated balance sheet
----------------------------
of Borrower and its Subsidiaries for the fiscal year ended January 3, 1999, and
the related consolidated statements of income and cash flows for such fiscal
year of Borrower.
"Bank of America" means Bank of America, N.A.
---------------
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<PAGE>
"Base Rate" means a fluctuating rate per annum equal to the higher of (a)
---------
the Federal Funds Rate plus 1/2 of 1% and (b) the rate of interest in effect for
such day as publicly announced from time to time by Bank of America as its
"prime rate." Such rate is a rate set by Bank of America based upon various
factors including Bank of America's costs and desired return, general economic
conditions and other factors, and is used as a reference point for pricing some
loans, which may be priced at, above, or below such announced rate. Any change
in such rate announced by Bank of America shall take effect at the opening of
business on the day specified in the public announcement of such change.
"Base Rate Loan" means a Loan which bears interest based on the Base Rate.
--------------
"Borrower" has the meaning set forth in the introductory paragraph hereto.
--------
"Borrower Party" means Borrower or any Person other than Lenders and any
--------------
Affiliates of Lenders, Administrative Agent, Issuing Lender and Documentation
Agent from time to time party to a Loan Document.
"Borrowing" and "Borrow" each mean, a borrowing hereunder consisting of
--------- ------
Loans of the same type made on the same day and, other than in the case of Base
Rate Loans, having the same Interest Period.
"Borrowing Date" means the date that a Loan is made, which shall be a
--------------
Business Day.
"Business Day" means any day other than a Saturday, Sunday, or other day on
------------
which commercial banks are authorized to close under the Laws of, or are in fact
closed in, the state where Administrative Agent's Office is located and, if such
day relates to any Offshore Rate Loan, means any such day on which dealings in
Dollar deposits are conducted by and between banks in the offshore Dollar
interbank market.
"Cash Equivalents" means, when used in connection with any Person, that
----------------
Person's Investments in:
(a) Government Securities due within one year after the date of the
making of the Investment;
(b) readily marketable direct obligations of any State of the United
States of America or any political subdivision of any such State or any
public agency or instrumentality thereof given on the date of such
Investment a credit rating of at least Aa by Moody's Investors Service,
Inc. or AA by Standard & Poor's Corporation, in each case due within one
year from the making of the Investment;
(c) certificates of deposit issued by, bank deposits in, eurodollar
deposits through, bankers' acceptances of, and repurchase agreements
covering Government Securities executed by any Lender or any bank
incorporated under the Laws of the United States of America, any State
thereof or the District of Columbia and having on the date of such
Investment combined capital, surplus and undivided profits of at least
$250,000,000,
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<PAGE>
or total assets of at least $5,000,000,000, in each case due within one
year after the date of the making of the Investment;
(d) certificates of deposit issued by, bank deposits in, eurodollar
deposits through, bankers' acceptances of, and repurchase agreements
covering Government Securities executed by any Lender or any branch or
office located in the United States of America of a bank incorporated under
the Laws of any jurisdiction outside the United States of America having on
the date of such Investment combined capital, surplus and undivided profits
of at least $500,000,000, or total assets of at least $15,000,000,000, in
each case due within one year after the date of the making of the
Investment;
(e) repurchase agreements covering Government Securities executed by a
broker or dealer registered under Section 15(b) of the Securities Exchange
Act of 1934, as amended, having on the date of the Investment capital of at
least $50,000,000, due within 90 days after the date of the making of the
Investment; provided that the maker of the Investment receives written
--------
confirmation of the transfer to it of record ownership of the Government
Securities on the books of a "primary dealer" in such Government Securities
or on the books of such registered broker or dealer, as soon as practicable
after the making of the Investment;
(f) readily marketable commercial paper or other debt securities
issued by corporations doing business in and incorporated under the Laws of
the United States of America or any State thereof or of any corporation
that is the holding company for a bank described in clause (c) or (d) above
- -
given on the date of such Investment a credit rating of at least P-1 by
Moody's Investors Service, Inc. or A-1 by Standard & Poor's Corporation, in
each case due within one year after the date of the making of the
Investment;
(g) "money market preferred stock" issued by a corporation
incorporated under the Laws of the United States of America or any State
thereof (i) given on the date of such Investment a credit rating of at
least Aa by Moody's Investors Service, Inc. and AA by Standard & Poor's
Ratings Services, a division of The McGraw-Hill Companies, Inc., in each
case having an investment period not exceeding 50 days or (ii) to the
extent that investors therein have the benefit of a standby letter of
credit issued by a Lender or a bank described in clauses (c) or (d) above;
- -
provided that (y) the amount of all such Investments issued by the same
--------
issuer does not exceed $5,000,000 and (z) the aggregate amount of all such
Investments does not exceed $15,000,000;
(h) a readily redeemable "money market mutual fund" sponsored by a
bank described in clause (c) or (d) hereof, or a registered broker or
- -
dealer described in clause (e) hereof, that has and maintains an investment
-
policy limiting its investments primarily to instruments of the types
described in clauses (a) through (g) hereof and given on the date of such
- -
Investment a credit rating of at least Aa by Moody's Investors Service,
Inc. and AA by Standard & Poor's Ratings Services, a division of The
McGraw-Hill Companies, Inc.; and
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<PAGE>
(i) corporate notes or bonds having an original term to maturity of
not more than one year issued by a corporation incorporated under the Laws
of the United States of America, or a participation interest therein;
provided that (i) commercial paper issued by such corporation is given on
--------
the date of such Investment a credit rating of at least Aa by Moody's
Investors Service, Inc. and AA by Standard & Poor's Ratings Services, a
division of The McGraw-Hill Companies, Inc., (ii) the amount of all such
Investments issued by the same issuer does not exceed $5,000,000 and (iii)
the aggregate amount of all such Investments does not exceed $15,000,000.
"Cash Flow Coverage Ratio" means, as of any date of determination, for
------------------------
Borrower and its Subsidiaries on a consolidated basis, the ratio of (a) (i)
Consolidated EBITDA for the period of the four prior fiscal quarters ending on
such date less (ii) capital expenditures made during such period less (iii) cash
---- ----
taxes paid during such period to (b) the sum of (i) Consolidated Interest
Charges for such period plus (ii) scheduled principal payments of Indebtedness
----
for such period (unless renewable or extendible at the option of the obligor
beyond such period).
"Change in Control" means Richard L. Rosenfield, Rosenfield Children Trust,
-----------------
Larry S. Flax, Bruckmann, Rosser, Sherrill & Co., L.P., Furman Selz SBIC, L.P.,
Roy L. Furman, David S. Harris, Eric Gleacher, Robert A. Engel, James Goodwin,
Emil Henry, Roger Hoit, H. Conrad Meyer III, David Mills, Charles Phillips,
Clayton J. Rohrbach III, Jeffrey Tepper, Gleacher IV, L.P., BancBoston
Investments, Inc., Bruce C. Bruckmann, BCB Family Partners, NAZ Family Partners,
Nancy A. Zweng, H. Virgil Sherrill, Harold O. Rosser, Paul D. Kaminski, J. Rice
Edmonds, and Marilena Tibrea ceasing, as a group, to have beneficial ownership
and control of at least 51% of the total voting power of all classes of capital
stock of Borrower entitled to vote generally in the election of directors.
"Closing Date" means the date all the conditions precedent in Section 4.01
------------ ------------
are satisfied or waived in accordance with Section 4.01.
------------
"Code" means the Internal Revenue Code of 1986, as amended from time to
----
time.
"Collateral Documents" means, collectively, the Security Agreement, any
--------------------
Supplemental Security Agreements, the Pledge Agreement, any Joinder Agreement
and any other security agreements, pledge agreements, deeds of trust, mortgages,
collateral security agreements, supplements, financing statements (or comparable
documents now or hereafter filed in accordance with the Uniform Commercial Code
or comparable law), filings, recordings, consents and other documents from time
to time executed, delivered, filed or recorded in connection with perfecting,
effecting, facilitating, consenting to, providing notice of or otherwise
evidencing Liens to secure the Obligations, in each case either as originally
executed or as from time to time supplemented, modified, amended, extended or
supplanted.
"Commitments" means the Revolving Commitments and the Term Commitments.
-----------
"Compliance Certificate" means a certificate substantially in the form of
----------------------
Exhibit B, properly completed and signed by a Responsible Officer of Borrower.
---------
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<PAGE>
"Consolidated EBIRT" means, for any period, for Borrower and its
------------------
Subsidiaries on a consolidated basis, an amount equal to the sum of (a)
Consolidated Net Income, (b) Consolidated Interest Charges, (c) lease and rental
expense, (d) the amount of taxes, based on or measured by income, used or
included in the determination of such Consolidated Net Income and (e) non-cash
charges which will not result in a cash expense, including, without limitation,
such charges resulting from compliance with FASB 121, compensation expense
relating to variable plan accounting and write-offs of unamortized cost relating
the Existing Credit Facility.
"Consolidated EBITDA" means, for any period, for Borrower and its
-------------------
Subsidiaries on a consolidated basis, an amount equal to the sum of (a)
Consolidated Net Income, (b) Consolidated Interest Charges, (c) the amount of
taxes, based on or measured by income, used or included in the determination of
such Consolidated Net Income, (d) the amount of depreciation and non-cash
amortization expense deducted in determining such Consolidated Net Income, and
(e) non-cash charges which will not result in a cash expense, including, without
limitation, such charges resulting from compliance with FASB 121, compensation
expense relating to variable plan accounting and write-offs of unamortized cost
relating the Existing Credit Facility.
"Consolidated Funded Indebtedness" means, as of any date of determination,
--------------------------------
for Borrower and its Subsidiaries on a consolidated basis, the sum of (a) the
outstanding principal amount of all obligations and liabilities, whether current
or long-term, for borrowed money (including Obligations hereunder), (b) that
portion of obligations with respect to capital leases that are capitalized in
the consolidated balance sheet of Borrower and its Subsidiaries, and (c) without
duplication, all Guaranty Obligations with respect to Indebtedness of the type
specified in subsections (a) and (b) above of Persons other than Borrower or any
of its Subsidiaries.
"Consolidated Interest Charges" means, for any period, for Borrower and its
-----------------------------
Subsidiaries on a consolidated basis, the sum of (a) all interest, premium
payments, fees, charges and related expenses payable by Borrower and its
Subsidiaries in connection with borrowed money (including capitalized interest)
or in connection with the deferred purchase price of assets, in each case to the
extent treated as interest in accordance with GAAP, and (b) the portion of rent
payable by Borrower and its Subsidiaries with respect to such period under
capital leases that is treated as interest in accordance with GAAP.
"Consolidated Net Income" means, for any period, for Borrower and its
-----------------------
Subsidiaries on a consolidated basis, the net income of Borrower and its
Subsidiaries from continuing operations for that period excluding extraordinary
---------
items, gains or losses from Dispositions of assets and non-cash gains.
"Consolidated Net Worth" means, as of any date of determination, for
----------------------
Borrower and its Subsidiaries on a consolidated basis, Shareholders' Equity of
Borrower and its Subsidiaries on that date.
"Continuation" and "Continue" mean, with respect to any Offshore Rate Loan,
------------ --------
the continuation of such Offshore Rate Loan as an Offshore Rate Loan on the last
day of the Interest Period for such Loan.
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<PAGE>
"Contractual Obligation" means, as to any Person, any provision of any
----------------------
security issued by such Person or of any agreement, instrument or undertaking to
which such Person is a party or by which it or any of its property is bound.
"Conversion" and "Convert" mean, with respect to any Loan, the conversion
---------- -------
of such Loan from or into another type of Loan.
"Debtor" means a Person pledging Collateral under the Security Agreement or
------
the Pledge Agreement.
"Debtor Relief Laws" means the Bankruptcy Code of the United States of
------------------
America, and all other liquidation, conservatorship, bankruptcy, assignment for
the benefit of creditors, moratorium, rearrangement, receivership, insolvency,
reorganization, or similar debtor relief Laws of the United States of America or
other applicable jurisdictions from time to time in effect affecting the rights
of creditors generally.
"Default" means any event that, with the giving of any notice, the passage
-------
of time, or both, would be an Event of Default.
"Default Rate" means an interest rate equal to the Base Rate plus the
------------ ----
Applicable Amount, if any, applicable to Base Rate Loans plus 2% per annum, to
----
the fullest extent permitted by applicable Laws; provided, however, that with
-------- -------
respect to an Offshore Rate Loan, the Default Rate shall be an interest rate
equal to the interest rate (including any Applicable Amount) otherwise
applicable to such Loan plus 2% per annum.
"Designated Deposit Account" means a deposit account maintained by Borrower
--------------------------
with Bank of America, as from time to time designated by Borrower to
Administrative Agent.
"Disposition" or "Dispose" means the sale, transfer, license or other
----------- -------
disposition (including any sale and leaseback transaction) of any property by
any Person, including any sale, assignment, transfer or other disposal with or
without recourse of any notes or accounts receivable or any rights and claims
associated therewith.
"Dollar" and "$" means lawful money of the United States of America.
------ -
"Documentation Agent" means Bankers Trust Company in its capacity as
-------------------
documentation agent hereunder.
"Domestic Subsidiary" means a Subsidiary of Borrower which is incorporated
-------------------
under the laws of any State of the United States, other than such a Subsidiary
which is a Subsidiary of a Foreign Subsidiary (collectively, the "Domestic
--------
Subsidiaries").
------------
"Eligible Assignee" means (a) a financial institution organized under the
-----------------
laws of the United States, or any state thereof, and having a combined capital
and surplus of at least $100,000,000; (b) a commercial bank organized under the
laws of any other country which is a member of the Organization for Economic
Cooperation and Development, or a political
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<PAGE>
subdivision of any such country, and having a combined capital and surplus of at
least $100,000,000, provided that such bank is acting through a branch or agency
located in the United States; (c) a Person that is primarily engaged in the
business of commercial banking that is (i) a Subsidiary of a Lender, (ii) a
Subsidiary of a Person of which a Lender is a Subsidiary, or (iii) a Person of
which a Lender is a Subsidiary; (d) another Lender and (e) any other entity
which is an "accredited investor" (as defined in Regulation D under the
Securities Act of 1933, as amended) which extends credit or buys loans as one of
its businesses, including but not limited to, insurance companies, mutual funds
and lease financing companies. No Borrower Party or any Affiliate of a Borrower
Party shall be an Eligible Assignee.
"Environmental Laws" means all Laws relating to environmental, health,
------------------
safety and land use matters applicable to any property.
"ERISA" means the Employee Retirement Income Security Act of 1974 and any
-----
regulations issued pursuant thereto, as amended from time to time.
"ERISA Affiliate" means any trade or business (whether or not incorporated)
---------------
under common control with Borrower within the meaning of Sections 414(b) or (c)
of the Code (and Sections 414(m) and (o) of the Code for purposes of provisions
relating to Section 412 of the Code).
"Event of Default" means any of the events specified in Section 8.
---------------- ---------
"Existing Credit Facility" means that certain Credit Agreement dated as of
------------------------
September 30, 1997, as amended, among Borrower, Union Bank of California, as
agent and a syndicate of lenders.
"Extension of Credit" means (a) a Borrowing, Conversion or Continuation of
-------------------
Loans or (b) a Letter of Credit Action which has the effect of increasing the
amount of a Letter of Credit, extending the maturity of a Letter of Credit or
making any material modification to a Letter of Credit or the reimbursement of
drawings under a Letter of Credit (collectively, the "Extensions of Credit").
--------------------
"Federal Funds Rate" means, for any day, the rate per annum (rounded
------------------
upwards to the nearest 1/100 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 on the Business Day next succeeding such day; provided that
--------
(a) if such day is not a Business Day, the Federal Funds Rate for such day shall
be such rate on such transactions on the next preceding Business Day as so
published on the next succeeding Business Day, and (b) if no such rate is so
published on such next succeeding Business Day, the Federal Funds Rate for such
day shall be the average rate charged to Bank of America on such day on such
transactions as determined by Administrative Agent.
"Fixed Charge Coverage Ratio" means, as of any date of determination, for
---------------------------
Borrower and its Subsidiaries on a consolidated basis, the ratio of (a)
Consolidated EBIRT for the period of the
-8-
<PAGE>
four prior fiscal quarters ending on such date to (b) the sum of (i)
Consolidated Interest Charges for such period plus (ii) lease and rental expense
----
during such period.
"Foreign Subsidiary" means a Subsidiary of Borrower which is not a Domestic
------------------
Subsidiary (collectively, the "Foreign Subsidiaries").
--------------------
"GAAP" means generally accepted accounting principles set forth in the
----
opinions and pronouncements of the Accounting Principles Board and the American
Institute of Certified Public Accountants and statements and pronouncements of
the Financial Accounting Standards Board or such other principles as may be
approved by a significant segment of the accounting profession, that are
applicable to the circumstances as of the date of determination, consistently
applied. If at any time any change in GAAP would affect the computation of any
financial ratio or requirement set forth in any Loan Document, and either
Borrower or the Requisite Lenders shall so request: (a) Administrative Agent,
Lenders and Borrower shall negotiate in good faith to amend such ratio or
requirement to preserve the original intent thereof in light of such change in
GAAP (subject to the approval of the Requisite Lenders), and (b) until so
amended, (i) such ratio or requirement shall continue to be computed in
accordance with GAAP prior to such change therein and (ii) Borrower shall
provide to Administrative Agent, and Lenders financial statements and other
documents required under this Agreement or as reasonably requested hereunder
setting forth a reconciliation between calculations of such ratio or requirement
made before and after giving effect to such change in GAAP.
"Governmental Authority" means (a) any international, foreign, federal,
----------------------
state, county or municipal government, or political subdivision thereof, (b) any
governmental or quasi-governmental agency, authority, board, bureau, commission,
department, instrumentality, central bank or public body, or (c) any court,
administrative tribunal or public utility.
"Government Securities" means readily marketable (a) direct full faith and
---------------------
credit obligations of the United States of America or obligations guaranteed by
the full faith and credit of the United States of America and (b) obligations of
an agency or instrumentality of, or corporation owned, controlled or sponsored
by, the United States of America that are generally considered in the securities
industry to be implicit obligations of the United States of America.
"Guarantor" means each Person from time to time a guarantor under the
---------
Master Subsidiary Guaranty (collectively, the "Guarantors").
----------
"Guaranty Obligation" means, as to any Person, any (a) guaranty by that
-------------------
Person of Indebtedness of, or other obligation payable or performable by, any
other Person or (b) assurance, agreement, letter of responsibility, letter of
awareness, undertaking or arrangement given by that Person to an obligee of any
other Person with respect to the payment or performance of an obligation by, or
the financial condition of, such other Person, whether direct, indirect or
contingent, including any purchase or repurchase agreement covering such
obligation or any collateral security therefor, any agreement to provide funds
(by means of loans, capital contributions or otherwise) to such other Person,
any agreement to support the solvency or level of any balance sheet item of such
other Person or any "keep-well" or other arrangement of whatever nature given
for the purpose of assuring or holding harmless such obligee against loss
-9-
<PAGE>
with respect to any obligation of such other Person; provided, however, that the
-------- -------
term Guaranty Obligation shall not include endorsements of instruments for
deposit or collection in the ordinary course of business. The amount of any
Guaranty Obligation shall be deemed to be an amount equal to the stated or
determinable amount of the related primary obligation, or portion thereof,
covered by such Guaranty Obligation or, if not stated or determinable, the
maximum reasonably anticipated liability in respect thereof as determined by the
Person in good faith.
"Indebtedness" means as to any Person at a particular time, all items which
------------
would, in conformity with GAAP, be classified as liabilities on a balance sheet
of such Person as at such time (excluding trade and other accounts payable in
the ordinary course of business in accordance with customary trade terms and
which are not overdue for a period of more than 60 days and excluding deferred
taxes), but in any event including, without duplication:
(a) all obligations of such Person for borrowed money and all
obligations of such Person evidenced by bonds, debentures, notes or other
similar instruments;
(b) any direct or contingent obligations of such Person arising under
letters of credit (including standby and commercial), banker's acceptances,
bank guaranties, surety bonds and similar instruments;
(c) net obligations under any Swap Contract in an amount equal to (i)
if such Swap Contract has been closed out, the termination value thereof,
or (ii) if such Swap Contract has not been closed out, the mark-to-market
value thereof determined on the basis of readily available quotations
provided by any recognized dealer in such Swap Contract;
(d) whether or not so included as liabilities in accordance with GAAP,
all obligations of such Person to pay the deferred purchase price of
property or services, and indebtedness (excluding prepaid interest thereon)
secured by a Lien on property owned or being purchased by such Person
(including indebtedness arising under conditional sales or other title
retention agreements), whether or not such indebtedness shall have been
assumed by such Person or is limited in recourse;
(e) lease payment obligations under capital leases or Synthetic Lease
Obligations; and
(f) all Guaranty Obligations of such Person in respect of any of the
foregoing; provided, however, that Indebtedness shall not include redeemable
-------- -------
preferred stock.
For all purposes of this Agreement, the Indebtedness of any Person shall
include the Indebtedness of any partnership or joint venture in which such
Person is a general partner or a joint venturer, unless such Indebtedness is
expressly made non-recourse to such Person except for customary exceptions
acceptable to the Requisite Lenders.
"Indemnified Liabilities" has the meaning set forth in Section 10.13.
----------------------- -------------
-10-
<PAGE>
"Initial Projections" means those certain projections dated September 23,
-------------------
1999, as amended by a letter dated October 26, 1999.
"Interest Period" means, for each Offshore Rate Loan as requested by
---------------
Borrower, (a) initially, the period commencing on the date such Offshore Rate
Loan is disbursed, Continued as, or Converted into, an Offshore Rate Loan and
(b) thereafter, the period commencing on the last day of the preceding Interest
Period, and ending, in each case, on the earlier of (x) the scheduled Maturity
Date, or (y) one, two, three or six months thereafter (or such other period
consented to by Lenders); provided that:
--------
(i) any Interest Period that would otherwise end on a day that is
not a Business Day shall be extended to the next succeeding Business Day
unless such Business Day falls in another calendar month, in which case
such Interest Period shall end on the next preceding Business Day;
(ii) any Interest Period which begins on the last Business Day of a
calendar month (or on a day for which there is no numerically corresponding
day in the calendar month at the end of such Interest Period) shall end on
the last Business Day of the calendar month at the end of such Interest
Period;
(iii) No Interest Period applicable to any Term Loan shall extend
beyond the next Principal Payment Date unless, on that Principal Payment
Date, the sum of (A) the aggregate principal amount of Term Loans which are
Base Rate Loans plus (B) the aggregate principal amount of Term Loans which
----
are Offshore Rate Loans with an Interest Period ending on that Principal
Payment Date is at least equal to the Principal Payment Amount due on that
Principal Payment Date; and
(iv) unless Administrative Agent otherwise consents, there may not be
more than six Interest Periods in effect at any time.
"Interim Financial Statements" means the company-prepared consolidated
----------------------------
balance sheet of Borrower and its Subsidiaries for the 39-weeks ended October 3,
1999, and the related consolidated statements of income and cash flows for such
fiscal year of Borrower.
"Investment" means, as to any Person, any acquisition or any investment by
----------
such Person, whether by means of the purchase or other acquisition of stock or
other securities of any other Person or by means of a loan, creating a debt,
capital contribution, guaranty or other debt or equity participation or interest
in any other Person, including any partnership and joint venture interests in
such other Person. For purposes of covenant compliance, the amount of any
Investment shall be the amount actually invested, without adjustment for
subsequent increases or decreases in the value of such Investment.
"IRS" means the Internal Revenue Service.
---
"Issuing Lender" means Bank of America, or any successor issuing lender
--------------
hereunder.
-11-
<PAGE>
"Joinder Agreement" means a Joinder Agreement substantially in the form of
-----------------
Exhibit H, either as originally executed or as it may from time to time be
---------
supplemented, modified, amended, extended or supplanted.
"Laws" or "Law" means all international, foreign, federal, state and local
---- ---
statutes, treaties, rules, guidelines, regulations, ordinances, codes and
administrative or judicial precedents or authorities, including the
interpretation or administration thereof by any Governmental Authority charged
with the enforcement, interpretation or administration thereof, and all
applicable administrative orders, directed duties, requests, licenses,
authorizations and permits of, and agreements with, any Governmental Authority,
in each case whether or not having the force of law.
"Lender" means each lender from time to time party hereto and, as the
------
context requires, Issuing Lender and Swing Line Lender.
"Lending Office" means, as to any Lender, the office or offices of such
--------------
Lender described as such on Schedule 10.02, or such other office or offices as
--------------
such Lender may from time to time notify Administrative Agent.
"Letter of Credit" means any standby letter of credit issued or outstanding
----------------
hereunder.
"Letter of Credit Action" means the issuance, supplement, amendment,
-----------------------
renewal, extension, modification or other action relating to a Letter of Credit
hereunder.
"Letter of Credit Application" means an application for a Letter of Credit
----------------------------
Action as from time to time in use by Issuing Lender.
"Letter of Credit Cash Collateral Account" means a blocked deposit account
----------------------------------------
at Bank of America with respect to which Borrower hereby grants a security
interest in such account to Bank of America as security for Letter of Credit
Usage and with respect to which Borrower agrees to execute and deliver from time
to time such documentation as Bank of America or Administrative Agent may
reasonably request to further assure and confirm such security interest.
"Letter of Credit Sublimit" means an amount equal to the lesser of the
-------------------------
combined Revolving Commitments and $2,000,000. The Letter of Credit Sublimit is
part of the Revolving Commitments and is not in addition to the Revolving
Commitments or the Term Commitments.
"Letter of Credit Usage" means, as at any date of determination, the
----------------------
aggregate undrawn face amount of outstanding Letters of Credit plus the
----
aggregate amount of all drawings under the Letters of Credit not reimbursed to
Issuing Lender by Borrower or converted into Loans.
"Leverage Ratio" means, as of any date of determination, for Borrower and
--------------
its Subsidiaries on a consolidated basis, the ratio of (a) Consolidated Funded
Indebtedness as of such date to (b) Consolidated EBITDA for the period of the
four fiscal quarters ending on that date.
-12-
<PAGE>
"Lien" means any mortgage, pledge, hypothecation, assignment, deposit
----
arrangement (in the nature of compensating balances, cash collateral accounts or
security interests), encumbrance, lien (statutory or other), charge, or
preference, priority or other security interest or preferential arrangement of
any kind or nature whatsoever (including any conditional sale or other title
retention agreement, any financing lease having substantially the same economic
effect as any of the foregoing, and the filing of any financing statement under
the Uniform Commercial Code or comparable Laws of any jurisdiction), including
the interest of a purchaser of accounts receivable.
"Loan" means any advance made by any Lender to Borrower as provided in
----
Section 2 (collectively, the "Loans").
--------- -----
"Loan Documents" means this Agreement, the Master Subsidiary Guaranty, the
--------------
Collateral Documents, any Letter of Credit Application, any Request for
Extension of Credit and any Note, certificate, any fee letter, and other
instrument, document or agreement from time to time delivered in connection with
this Agreement.
"Master Subsidiary Guaranty" means the Master Subsidiary Guaranty
--------------------------
substantially in the form of Exhibit E hereto, either as originally executed or
---------
as it may from time to time be supplemented, modified, amended, extended or
supplanted.
"Material Adverse Effect" means any set of circumstances or events which
-----------------------
(a) has or would reasonably be expected to have any material adverse effect
whatsoever upon the validity or enforceability of any Principal Loan Document or
the perfection or priority of any Lien on any material Collateral under any
Collateral Document, (b) is or would reasonably be expected to be material and
adverse to the condition (financial or otherwise), business, assets, operations
or prospects of Borrower and its Subsidiaries, taken as a whole, or (c)
materially impairs or would reasonably be expected to materially impair the
ability of any Borrower Party to perform a material portion of the Obligations,
in each case as reasonably determined by Requisite Lenders.
"Maturity Date" means October 31, 2004, as such date may be earlier
-------------
terminated or extended in accordance with the terms hereof.
-13-
<PAGE>
"Minimum Amount" means, with respect to each of the following actions, the
--------------
minimum amount and any multiples in excess thereof set forth opposite such
action:
Multiples in
Minimum excess
Type of Action Amount/1/ thereof/1/
--------------------------------------------------------------------------------
Borrowing or prepayment of, or Conversion $ 500,000 $100,000
into, Base Rate Loans
Borrowing, prepayment or Continuation of, or $ 500,000 $100,000
Conversion into, Offshore Rate Loans
Borrowing or prepayment of Swing Line Loans $ 100,000 None
Letter of Credit Action $ 25,000 None
Reduction in Commitments $1,000,000 $500,000
Assignments $5,000,000 None
"Negative Pledge" means a Contractual Obligation that restricts Liens on a
---------------
material portion of property.
"Net Cash Proceeds" means the gross proceeds received by Borrower and its
-----------------
Subsidiaries from any applicable transaction in Cash, net of brokerage
commissions, legal expenses and other transactional costs payable by Borrower
and its Subsidiaries in connection therewith and net of an amount determined in
good faith by Borrower to be the estimated amount of income, sales and uses
taxes payable by Borrower attributable to such transaction.
"Note" means a Revolving Note or a Term Note (collectively, the "Notes").
---- -----
"Notice of Assignment and Acceptance" means a Notice of Assignment and
-----------------------------------
Acceptance substantially in the form of Exhibit D.
---------
"Obligations" means all advances to, and debts, liabilities, obligations,
-----------
covenants and duties of, any Borrower Party arising under any Loan Document,
whether direct or indirect (including those acquired by assignment), absolute or
contingent, due or to become due, now existing or hereafter arising and
including interest that accrues after the commencement of any proceeding under
any Debtor Relief Laws by or against any Borrower Party or any Subsidiary or
Affiliate of any Borrower Party.
________________
/1/ Or such lesser amount as may be required to facilitate the payment of
the Principal Payment Amount payable on any Principal Payment Date.
-14-
<PAGE>
"Offshore Base Rate" has the meaning set forth in the definition of
------------------
Offshore Rate.
"Offshore Rate" means for any Interest Period with respect to any Offshore
-------------
Rate Loan, a rate per annum determined by Administrative Agent pursuant to the
following formula:
Offshore Rate = Offshore Base Rate
-----------------------------------------
1.00 - Eurodollar Reserve Percentage
Where,
"Offshore Base Rate" means, for such Interest Period:
------------------
(a) the rate per annum equal to the rate determined by Administrative
Agent to be the offered rate that appears on the page of the Telerate
Screen that displays an average British Bankers Association Interest
Settlement Rate for deposits in Dollars (for delivery on the first day of
such Interest Period) with a term equivalent to such Interest Period,
determined as of approximately 11:00 a.m. (London time) two Business Days
prior to the first day of such Interest Period, or
(b) in the event the rate referenced in the preceding subsection (a)
does not appear on such page or service or such page or service shall cease
to be available, the rate per annum equal to the rate determined by
Administrative Agent to be the offered rate on such other page or other
service that displays an average British Bankers Association Interest
Settlement Rate for deposits in Dollars (for delivery on the first day of
such Interest Period) with a term equivalent to such Interest Period,
determined as of approximately 11:00 a.m. (London time) two Business Days
prior to the first day of such Interest Period, or
(c) in the event the rates referenced in the preceding subsections (a)
and (b) are not available, the rate per annum determined by Administrative
Agent as the rate of interest (rounded up to the nearest 1/100% of 1%) at
which Dollar deposits (for delivery on the first day of such Interest
Period) in same day funds in the approximate amount of the applicable
Offshore Rate Loan and with a term equivalent to such Interest Period would
be offered by its London Branch to major banks in the offshore Dollar
market at their request at approximately 11:00 a.m. (London time) two
Business Days prior to the first day of such Interest Period.
"Eurodollar Reserve Percentage" means, for any day during any Interest
-----------------------------
Period, the reserve percentage (expressed as a decimal, rounded upward to
the next 1/100th of 1%) in effect on such day, whether or not applicable to
any Lender, under regulations issued from time to time by the Board of
Governors of the Federal Reserve System for determining the maximum reserve
requirement (including any emergency, supplemental or other marginal
reserve requirement) with respect to Eurocurrency funding (currently
referred to as "Eurocurrency liabilities"). The Offshore Rate for each
outstanding Offshore Rate Loan shall be adjusted automatically as of the
effective date of any change in the Eurodollar Reserve Percentage.
-15-
<PAGE>
"Offshore Rate Loan" means a Loan bearing interest based on the Offshore
------------------
Rate.
"Ordinary Course Dispositions" means:
----------------------------
(a) Dispositions of obsolete or worn out property, whether now owned
or hereafter acquired, in the ordinary course of business;
(b) Dispositions of cash, cash equivalents, inventory and other
property in the ordinary course of business;
(c) Dispositions of property to the extent that such property is
exchanged for credit against the purchase price of similar replacement
property, or the proceeds of such sale are reasonably promptly applied to
the purchase price of such replacement property or where Borrower or its
Subsidiary determine in good faith that the failure to replace such
property will not be detrimental to the business of Borrower or such
Subsidiary provided, further, that no such Disposition shall be for less
--------- -------
than the fair market value of the property being disposed of; and
(d) Dispositions of assets or property by any Subsidiary of Borrower
to Borrower or another wholly-owned Subsidiary of Borrower; provided,
--------
however, that if any asset so Disposed of is subject to a Lien under the
-------
Collateral Documents, such asset shall remain subject to such Lien, and if
the transferor Subsidiary is a Guarantor or had its equity interests
pledged under the Pledge Agreement, the transferee Subsidiary shall also be
a Guarantor or have its equity interests pledged under the Pledge
Agreement, and in each such case Borrower shall promptly notify
Administrative Agent of such Disposition;
(e) the grant of licenses to use Trademark Collateral and Trade Secret
Collateral (as defined in the Security Agreement) in the ordinary course of
business.
"Ordinary Course Indebtedness" means:
----------------------------
(a) Indebtedness under the Loan Documents;
(b) intercompany Guaranty Obligations of Borrower or any of its
Subsidiaries guarantying Indebtedness otherwise permitted hereunder of
Borrower or any wholly-owned Subsidiary of Borrower;
(c) Indebtedness arising from the honoring of a check, draft or
similar instrument against insufficient funds; and
(d) Ordinary Course Swap Obligations.
"Ordinary Course Investments" means Investments consisting of:
---------------------------
(a) cash and Cash Equivalents;
-16-
<PAGE>
(b) advances to officers, directors and employees of Borrower and its
Subsidiaries for travel, entertainment, relocation and analogous ordinary
business purposes;
(c) other advances to officers, directors and employees of Borrower
and its Subsidiaries not exceeding $500,000 in the aggregate outstanding at
any time;
(d) Investments of Borrower in any of its Subsidiaries and Investments
of any Subsidiary of Borrower in Borrower or another Subsidiary of
Borrower;
(e) extensions of credit to customers or suppliers of Borrower and its
Subsidiaries in the ordinary course of business and any Investments
received in satisfaction or partial satisfaction thereof; and
(f) Guaranty Obligations permitted by Section 7.01;
------------
provided, however, that for purposes of this definition, Subsidiaries shall
-------- -------
not include CPK Beverage, Inc., CPK I, Limited Partnership or CPK Water
Tower Limited Partnership.
"Ordinary Course Liens" means:
---------------------
(a) Liens pursuant to any Loan Document;
(b) Liens for taxes not yet due or which are being contested in good
faith and by appropriate proceedings, if adequate reserves with respect
thereto are maintained on the books of the applicable Person in accordance
with GAAP;
(c) carriers', warehousemen's, mechanics', materialmen's, repairmen's
or other like Liens arising in the ordinary course of business which are
not overdue for a period of more than 30 days or which are being contested
in good faith and by appropriate proceedings, if adequate reserves with
respect thereto are maintained on the books of the applicable Person;
(d) pledges or deposits in connection with worker's compensation,
unemployment insurance and other social security legislation;
(e) deposits to secure the performance of bids, trade contracts (other
than for borrowed money), leases, statutory obligations, surety and appeal
bonds, performance bonds and other obligations of a like nature incurred in
the ordinary course of business;
(f) easements, rights-of-way, restrictions and other similar
encumbrances affecting real property which, in the aggregate, are not
substantial in amount, and which do not in any case materially detract from
the value of the property subject thereto or materially interfere with the
ordinary conduct of the business of any Person; and
-17-
<PAGE>
(g) attachment, judgment or other similar Liens arising in connection
with litigation or other legal proceedings (and not otherwise a Default
hereunder) in the ordinary course of business that is currently being
contested in good faith by appropriate proceedings provided that such Lien
is junior to the Lien of the Collateral Documents, adequate reserves have
been set aside and no material property is subject to a material risk of
loss or forfeiture and the claims in respect of such Liens are fully
covered by insurance (subject to ordinary and customary deductibles).
"Ordinary Course Swap Obligations" means all obligations (contingent or
--------------------------------
otherwise) of Borrower or any Subsidiary existing or arising under any Swap
Contract, provided that each of the following criteria is satisfied: (a) such
--------
obligations are (or were) entered into by such Person in the ordinary course of
business for the purpose of directly mitigating risks associated with
liabilities, commitments or property held or reasonably anticipated by such
Person, or changes in the value of securities issued by such Person in
conjunction with a securities repurchase program not otherwise prohibited
hereunder, and not for purposes of speculation or taking a "market view;" and
(b) such Swap Contracts do not contain (i) any provision ("walk-away" provision)
exonerating the non-defaulting party from its obligation to make payments on
outstanding transactions to the defaulting party, or (ii) any provision creating
or permitting the declaration of an event of default, termination event or
similar event upon the occurrence of an Event of Default hereunder (other than
an Event of Default referred to in Section 8.01(f)(ii)).
-------------------
"Organization Documents" means, (a) with respect to any corporation, the
----------------------
certificate or articles of incorporation and the bylaws; (b) with respect to any
limited liability company, the articles of formation and operating agreement;
and (c) with respect to any partnership, joint venture, trust or other form of
business entity, the partnership or joint venture agreement and any agreement,
instrument, filing or notice with respect thereto filed in connection with its
formation with the secretary of state or other department in the state of its
formation, in each case as amended from time to time.
"Outstanding Obligations" means the Outstanding Revolving Obligations and
-----------------------
the Outstanding Term Obligations.
"Outstanding Revolving Obligations" means, as of any date, and giving
---------------------------------
effect to making any Extensions of Credit requested on such date and all
payments, repayments and prepayments made on such date, (a) when reference is
made to all Lenders, the sum of (i) the aggregate outstanding principal amount
of all Revolving Loans and Swing Line Loans, and (ii) all Letter of Credit
Usage, and (b) when reference is made to one Lender the sum of (i) the aggregate
outstanding principal amount of all Revolving Loans made by such Lender
(excluding, in the case of the Swing Line Lender, its Swing Line Loans except to
the extent provided in clause (iii) below), (ii) such Lender's ratable risk
participation in all Letter of Credit Usage, and (iii) such Lender's ratable
risk participation in all outstanding Swing Line Loans.
"Outstanding Term Obligations" means, as of any date, and giving effect to
----------------------------
making any Extensions of Credit requested on such date and all payments,
repayments and prepayments made on such date, (a) when reference is made to all
Lenders, the aggregate outstanding principal amount
-18-
<PAGE>
of all Term Loans, and (b) when reference is made to one Lender the aggregate
outstanding principal amount of all Term Loans made by such Lender.
"Person" means any individual, trustee, corporation, general partnership,
------
limited partnership, limited liability company, joint stock company, trust,
unincorporated organization, bank, business association, firm, joint venture,
Governmental Authority, or otherwise.
"Pledge Agreement" means the pledge agreement substantially in the form of
----------------
Exhibit G, either as originally executed or as it may from time to time be
---------
supplemented, modified, amended, extended or supplanted.
"Pledged Collateral" means all certificates or instruments representing or
------------------
evidencing the Collateral pledged or to be pledged under the Pledge Agreement.
"Principal Loan Documents" means this Agreement, the Master Subsidiary
------------------------
Guaranty, the Security Agreement, the Pledge Agreement, any Supplemental
Security Agreements, any Note and any other principal agreement delivered from
time to time in connection with this Agreement.
"Principal Payment Amount" means, with respect to any Principal Payment
------------------------
Date, the amount set forth below opposite that Principal Payment Date:
Principal Principal
Principal Payment Payment Principal Payment Payment
Date Amount Date Amount
----------------------------------------------------------------------------------------------------
September 30, 2000 $ 750,000 March 31, 2002 $1,250,000
December 31, 2000 $ 750,000 June 30, 2002 $1,250,000
Total for year $1,500,000 September 30, 2002 $1,250,000
December 31, 2002 $1,250,000
Total for year $5,000,000
March 31, 2001 $ 750,000 March 31, 2003 $1,500,000
June 30, 2001 $ 750,000 June 30, 2003 $1,500,000
September 30, 2001 $ 750,000 September 30, 2003 $1,500,000
December 31, 2001 $ 750,000 December 31, 2003 $1,500,000
Total for year $3,000,000 Total for year $6,000,000
March 31, 2004 $3,167,000
June 30, 2004 $3,167,000
September 30, 2004 $3,166,000
Maturity Date Remaining
"Principal Payment Date" means each of the dates set forth under "Principal
----------------------
Payment Date" in the definition of "Principal Payment Amount."
-19-
<PAGE>
"Pro Rata Share" means, with respect to each Lender, the percentage of the
--------------
combined Commitments set forth opposite the name of that Lender on Schedule
--------
2.01.
----
"Request for Extension of Credit" means a written request substantially in
-------------------------------
the form of Exhibit A duly completed and signed by a Responsible Officer of
---------
Borrower and delivered by Requisite Notice. In the case of a Letter of Credit
Action, the Letter of Credit Application shall be deemed to be the Request for
Extension of Credit.
"Requisite Lenders" means, as of any date of determination: (a) if the
-----------------
Commitments are then in effect, at least two Lenders (excluding any Lenders not
funding when required to do so hereunder) having in the aggregate more than 66-
2/3% of the combined Commitments then in effect and (b) if the Commitments have
then been terminated and there are Outstanding Obligations, at least two Lenders
holding Obligations aggregating more than 66-2/3% of such Outstanding
Obligations.
"Requisite Notice" means, unless otherwise provided herein, (a) irrevocable
----------------
written notice to the intended recipient or (b) except with respect to Letter of
Credit Actions (which must be in writing), irrevocable telephonic notice to the
intended recipient, promptly followed by a written notice to such recipient.
Such notices shall be (i) delivered to such recipient at the address or
telephone number specified on Schedule 10.02 or as otherwise designated by such
--------------
recipient by Requisite Notice to Administrative Agent, and (ii) if made by any
Borrower Party, given or made by a Responsible Officer of such Borrower Party.
Any written notice delivered in connection with any Loan Document shall be in
the form, if any, prescribed herein or therein and may be delivered as provided
in Section 10.02. Any notice sent by other than hardcopy shall be promptly
-------------
confirmed by a telephone call to the recipient and, if requested by
Administrative Agent, by a manually-signed hardcopy thereof.
"Requisite Time" means, with respect to any of the actions listed below,
--------------
not later than the time and date set forth below opposite such action (all times
are California time):
-20-
<PAGE>
Type of Action Time Date of Action
---------------------------------------------------------------------------------------------------
Delivery of Request for Extension of Credit
for, or notice for:
. Borrowing or prepayment of, or Conversion 8:30 a.m. Same date as such Borrowing,
into, Base Rate Loans prepayment or Conversion
. Borrowing, prepayment or Continuation of, or 10:00 a.m. 3 Business Days prior to such
Conversion into, Offshore Rate Loans Borrowing, prepayment,
Continuation, or Conversion
. Borrowing or prepayment of Swing Line Loans 1:00 p.m. Same date as such Borrowing or
prepayment
. Letter of Credit Action 10:00 a.m. 2 Business Days prior to such
action (or such lesser time which
is acceptable to Issuing Lender)
. Voluntary reduction in or termination of 10:00 a.m. 2 Business Days prior to such
Commitments reduction or termination
Payments by Lenders or Borrower to 11:00 a.m. On date payment is due
Administrative Agent
"Responsible Officer" means the president, chief financial officer or
-------------------
controller of a Borrower Party. Any document or certificate hereunder that is
signed by a Responsible Officer of a Borrower Party shall be conclusively
presumed to have been authorized by all necessary corporate, partnership and/or
other action on the part of such Borrower Party and such Responsible Officer
shall be conclusively presumed to have acted on behalf of such Borrower Party.
"Restricted Payment" means:
------------------
(a) the declaration or payment of any dividend or distribution by
Borrower or any of its Subsidiaries, either in cash or property, on any
shares of the capital stock of any class of Borrower or any of its
Subsidiaries (except dividends or other distributions payable solely in
shares of capital stock of Borrower or any of its Subsidiaries or payable
by a Subsidiary to Borrower or another wholly-owned Subsidiary of
Borrower);
(b) the purchase, redemption or retirement by Borrower or any of its
Subsidiaries of any shares of its capital stock of any class or any
warrants, rights or options to purchase or acquire any shares of its
capital stock, whether directly or indirectly;
(c) any other payment or distribution by Borrower or any of its
Subsidiaries in respect of its capital stock, either directly or
indirectly;
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(d) any Investment other than an Investment otherwise permitted under
any Loan Document; and
(e) the payment or prepayments of any principal (including sinking
fund payments) or any other amount (other than scheduled interest payments)
with respect to any Indebtedness (including the payment of cash in
connection with such a conversion thereof), or the purchase or redemption
of (or offer to purchase or redeem) any Indebtedness, or the deposit of any
monies, securities or other property with any trustee or other Person to
provide assurance that the principal or any portion thereof of any
Indebtedness will be paid when due or any other provision for the
defeasance of any Indebtedness.
"Revolving Commitment" means, as to any Lender, the amount set forth
--------------------
opposite such Lender's name on Schedule 2.01 hereto under the heading Revolving
-------------
Commitments, as such amount may be reduced from time to time in accordance with
this Agreement (collectively, the "combined Revolving Commitments").
------------------------------
"Revolving Loan" has the meaning specified in Section 2.01(a).
-------------- ---------------
"Revolving Note" means a promissory note made by Borrower in favor of a
--------------
Lender evidencing Revolving Loans made by such Lender, substantially in the form
of Exhibit C-1 (collectively, the "Revolving Notes").
----------- ---------------
"Security Agreement" means the security agreement substantially in the form
------------------
of Exhibit F, either as originally executed or as it may from time to time be
---------
supplemented, modified, amended, extended or supplanted.
"Shareholders' Equity" means, as of any date of determination for Borrower
--------------------
and its Subsidiaries on a consolidated basis, shareholders' equity, including
redeemable preferred stock, as of that date determined in accordance with GAAP.
"Subsidiary" means a corporation, partnership, joint venture, limited
----------
liability company or other business entity of which a majority of the shares of
securities or other interests having ordinary voting power for the election of
directors or other governing body (other than securities or interests having
such power only by reason of the happening of a contingency) are at the time
beneficially owned, or the management of which is otherwise controlled,
directly, or indirectly through one or more intermediaries, or both, by
Borrower.
"Supplemental Security Agreement" means a duly executed, delivered and
-------------------------------
completed Supplemental Security Agreements (Trademarks) substantially in the
form of Exhibit A to the Security Agreement.
"Swap Contract" means (a) any and all rate swap transactions, basis swaps,
-------------
forward rate transactions, commodity swaps, commodity options, forward commodity
contracts, equity or equity index swaps or options, bond or bond price or bond
index swaps or options or forward bond or forward bond price or forward bond
index transactions, interest rate options, forward
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foreign exchange transactions, cap transactions, floor transactions, collar
transactions, currency swap transactions, cross-currency rate swap transactions,
currency options, or any other similar transactions or any combination of any of
the foregoing (including any options to enter into any of the foregoing),
whether or not any such transaction is governed by or subject to any master
agreement, and (b) any and all transactions of any kind, and the related
confirmations, which are subject to the terms and conditions of, or governed by,
any form of master agreement published by the International Swaps and
Derivatives Association, Inc., or any other master agreement (any such master
agreement, together with any related schedules, as amended, restated, extended,
supplemented or otherwise modified in writing from time to time, a "Master
------
Agreement"), including any such obligations or liabilities under any Master
---------
Agreement.
"Swap Termination Value" means, in respect of any one or more Swap
----------------------
Contracts, after taking into account the effect of any legally enforceable
netting agreement relating to such Swap Contracts, (a) for any date on or after
the date such Swap Contracts have been closed out and termination value(s)
determined in accordance therewith, such termination value(s), and (b) for any
date prior to the date referenced in clause (a) the amount(s) determined as the
mark-to-market value(s) for such Swap Contracts, as determined based upon one or
more mid-market or other readily available quotations provided by any recognized
dealer in such Swap Contracts (which may include any Lender).
"Swing Line" means the revolving line of credit established by Swing Line
----------
Lender in favor of Borrower pursuant to Section 2.04.
------------
"Swing Line Lender" means Bank of America, or any successor swing line
-----------------
Lender hereunder.
"Swing Line Loan" means a loan which bears interest at a rate per annum
---------------
equal to interest payable on a Base Rate Loan (plus the Applicable Amount, if
any) and made by Swing Line Lender to Borrower under the Swing Line.
"Swing Line Sublimit" means an amount equal to the lesser of (a) $5,000,000
-------------------
and (b) the combined Revolving Commitments. The Swing Line Sublimit is part of
the Revolving Commitments and is not in addition to the Revolving Commitments or
the Term Commitments.
"Synthetic Lease Obligations" means all monetary obligations of a Person
---------------------------
under (a) a so-called synthetic, off-balance sheet or tax retention lease, or
(b) an agreement for the use or possession of property creating obligations
which do not appear on the balance sheet of such Person but which, upon the
insolvency or bankruptcy of such Person, would be characterized as the
Indebtedness of such Person (without regard to accounting treatment).
"Term Commitment" means, as to any Lender, the amount set forth opposite
---------------
such Lender's name on Schedule 2.01 hereto under the heading Term Commitments,
-------------
as such amount may be reduced from time to time in accordance with this
Agreement (collectively, the "combined Commitments").
--------------------
"Term Loan" has the meaning specified in Section 2.01(b).
--------- ---------------
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"Term Note" means a promissory note made by Borrower in favor of a Lender
---------
evidencing Term Loans made by such Lender, substantially in the form of Exhibit
-------
C-2 (collectively, the "Term Notes").
--- ----------
"to the best knowledge of" means, when modifying a representation, warranty
------------------------
or other statement of any Person, that the fact or situation described therein
is known by such Person (or, in the case of a Person other than a natural
Person, known by a Responsible Officer of such Person) making the
representation, warranty or other statement, or with the exercise of reasonable
due diligence under the circumstances (in accordance with the standard of what a
reasonable Person in similar circumstances would have done) would have been
known by such Person (or, in the case of a Person other than a natural Person,
would have been known by a Responsible Officer of such Person).
"type" of Loan means (a) a Base Rate Loan, (b) an Offshore Rate Loan or (c)
----
a Swing Line Loan.
1.02 Use of Certain Terms.
(a) All terms defined in this Agreement shall have the defined meanings
when used in any certificate or other document made or delivered pursuant hereto
or thereto, unless otherwise defined therein.
(b) As used herein, unless the context requires otherwise, the masculine,
feminine and neuter genders and the singular and plural include one another.
(c) The words "herein" and "hereunder" and words of similar import when
------ ---------
used in any Loan Document shall refer to the Loan Documents as a whole and not
to any particular provision thereof. The term "including" is by way of example
---------
and not limitation. References herein to a Section, subsection or clause shall,
unless the context otherwise requires, refer to the appropriate Section,
subsection or clause in this Agreement.
(d) The term "or" is disjunctive; the term "and" is conjunctive. The term
-- ---
"shall" is mandatory; the term "may" is permissive. Masculine terms also apply
----- ---
to females; feminine terms also apply to males.
1.03 Accounting Terms. All accounting terms not specifically or completely
defined in this Agreement shall be construed in conformity with, and all
financial data required to be submitted by this Agreement shall be prepared in
conformity with, GAAP applied on a consistent basis, as in effect from time to
time, applied in a manner consistent with that used in preparing the Audited
Financial Statements, except as otherwise specifically prescribed herein.
------
1.04 Rounding. Any financial ratios required to be maintained by Borrower
pursuant to this Agreement shall be calculated by dividing the appropriate
component by the other component, carrying the result to one place more than the
number of places by which such ratio is expressed in this Agreement and rounding
the result up or down to the nearest number (with a
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round-up if there is no nearest number) to the number of places by which such
ratio is expressed in this Agreement.
1.05 Exhibits and Schedules. All exhibits and schedules to this Agreement,
either as originally existing or as the same may from time to time be
supplemented, modified or amended, are incorporated herein by this reference. A
matter disclosed on any Schedule shall be deemed disclosed on all Schedules.
1.06 References to Agreements and Laws. Unless otherwise expressly provided
herein, (a) references to agreements (including the Loan Documents) and other
contractual instruments shall include all amendments, restatements, extensions,
supplements and other modifications thereto (unless prohibited by any Loan
Document), and (b) references to any Law shall include all statutory and
regulatory provisions consolidating, amending, replacing, supplementing or
interpreting such Law.
SECTION 2.
THE COMMITMENTS AND EXTENSIONS OF CREDIT
2.01 Amount and Terms of Commitments.
(a) The Revolving Commitments. Subject to the terms and conditions set
forth in this Agreement, each Lender severally agrees until the Maturity Date to
(i) make, Convert and Continue revolving loans (each such loan, a "Revolving
---------
Loan") as Borrower may from time to time request; and (ii) purchase risk
----
participations in outstanding Letter of Credit Usage and Swing Line Loans;
provided, however, that the Outstanding Revolving Obligations of each Lender
-------- -------
shall not exceed such Lender's Revolving Commitment, and the Outstanding
Revolving Obligations of all Lenders shall not exceed the combined Revolving
Commitments at any time. Subject to the foregoing and the other terms and
conditions hereof, Borrower may borrow, Convert, Continue, prepay and reborrow
Revolving Loans as set forth herein without premium or penalty.
(b) The Term Commitments. Subject to the terms and conditions set forth in
this Agreement, each Lender severally agrees to make a single term loan (each
such loan, a "Term Loan") on the Closing Date and thereafter Convert and
---------
Continue such Term Loan as Term Loans hereunder as Borrower may from time to
time request; provided, however, that the aggregate principal amount of each
-------- -------
Lender's Term Loans shall not exceed such Lender's Term Commitment, and the
aggregate principal amount of all Lenders' Term Loans shall not exceed the
combined Term Commitments at any time. The Term Commitments are not revolving,
and except as provided in Section 2.05, Term Loans which are repaid or prepaid
------------
may not be reborrowed.
(c) Loans made by each Lender shall be evidenced by one or more loan
accounts or records maintained by such Lender in the ordinary course of
business. Upon the request of any Lender made through Administrative Agent,
such Lender's Revolving Loans may be evidenced by one or
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<PAGE>
more Revolving Notes, and such Lender's Term Loans may be evidenced by one or
more Term Notes, instead of or in addition to loan accounts. Each such Lender
may attach schedules to its Notes and endorse on its Revolving Note the date,
amount and maturity of its Revolving Loans and payments with respect thereto and
endorse on its Term Note the date, amount and maturity of its Term Loans and
payments with respect thereto. Such loan accounts, records or Notes shall be
conclusive absent manifest error of the amount of such Loans and payments
thereon. Any failure so to record or any error in doing so shall not, however,
limit or otherwise affect the obligation of Borrower to pay any amount owing
with respect to the Loans.
2.02 Borrowings, Conversions and Continuations of Loans.
(a) Borrower may irrevocably request a Borrowing, Conversion or
Continuation of Loans in a Minimum Amount therefor by delivering a Request for
Extension of Credit therefor by Requisite Notice to Administrative Agent not
later than the Requisite Time therefor. All Borrowings, Conversions and
Continuations shall constitute Base Rate Loans unless properly and timely
otherwise designated as set forth in the prior sentence.
(b) Following receipt of a Request for Extension of Credit, Administrative
Agent shall promptly notify each Lender of its Pro Rata Share thereof by
Requisite Notice. In the case of a Borrowing of Loans, each Lender shall make
the funds for its Loan available to Administrative Agent at Administrative
Agent's Office not later than the Requisite Time therefor on the Business Day
specified in such Request for Extension of Credit. Upon satisfaction of the
applicable conditions set forth in Section 4.02 (and, in the case of the initial
------------
Extension of Credit hereunder, Section 4.01), all funds so received shall be
------------
made available to Borrower in like funds received. Administrative Agent shall
promptly notify Borrower and Lenders of the interest rate applicable to any Loan
other than a Base Rate Loan upon determination of same.
(c) Except as otherwise provided herein, an Offshore Rate Loan may be
Continued or Converted only on the last day of the Interest Period for such
Offshore Rate Loan. During the existence of a Default or Event of Default, no
Loans may be requested as, Converted into or Continued as Offshore Rate Loans if
so determined by Requisite Lenders, and Requisite Lenders may demand that any or
all of the then outstanding Offshore Rate Loans be Converted immediately into
Base Rate Loans. Such Conversion shall be effective upon notice to Borrower and
shall continue so long as such Default or Event of Default continues to exist.
(d) If a Loan is to be made on the same date that another Loan is due and
payable, Borrower or Lenders, as the case may be, shall, unless Administrative
Agent otherwise requests, make available to Administrative Agent the net amount
of funds giving effect to both such Loans and the effect for purposes of this
Agreement shall be the same as if separate transfers of funds had been made with
respect to each such Loan.
(e) The failure of any Lender to make any Loan on any date shall not
relieve any other Lender of any obligation to make a Loan on such date, but no
Lender shall be responsible for the failure of any other Lender to so make its
Loan.
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<PAGE>
2.03 Letters of Credit.
(a) The Letter of Credit Sublimit. Subject to the terms and conditions set
forth in this Agreement, until the Maturity Date, Issuing Lender shall take such
Letter of Credit Actions under the Revolving Commitments as Borrower may from
time to time request; provided, however, that (i) the aggregate outstanding
-------- -------
Letter of Credit Usage shall not exceed the Letter of Credit Sublimit at any
time and (ii) the Outstanding Obligations of each Lender shall not exceed such
Lender's Revolving Commitment and the Outstanding Obligations of all Lenders
shall not exceed the combined Revolving Commitments at any time. Each Letter of
Credit Action shall be in a form acceptable to Issuing Lender. Unless consented
to by the Issuing Lender and the Requisite Lenders, no Letter of Credit may
expire more than 12 months after the date of its issuance or last renewal;
provided, however, that no Letter of Credit shall expire after the Maturity
-------- -------
Date. If any Letter of Credit Usage remains outstanding after the Maturity
Date, Borrower shall deposit cash in an amount equal to such Letter of Credit
Usage in a Letter of Credit Cash Collateral Account not later than the Maturity
Date.
(b) Requesting Letter of Credit Actions. Borrower may irrevocably request
a Letter of Credit Action in a Minimum Amount therefor by delivering a Letter of
Credit Application therefor to Issuing Lender, with a copy to Administrative
Agent (who shall notify Lenders), by Requisite Notice not later than the
Requisite Time therefor. Unless Administrative Agent notifies Issuing Lender
that such Letter of Credit Action is not permitted hereunder or Issuing Lender
notifies Administrative Agent that it has determined that such Letter of Credit
Action is contrary to any Laws or policies of Issuing Lender, Issuing Lender
shall, upon satisfaction of the applicable conditions set forth in Section 4.02
------------
with respect to any Letter of Credit Action constituting an Extension of Credit,
effect such Letter of Credit Action. This Agreement shall control in the event
of any conflict with any Letter of Credit Application. Upon the issuance of a
Letter of Credit, each Lender shall be deemed to have purchased a pro rata
participation in such Letter of Credit from Issuing Lender in an amount equal to
that Lender's Pro Rata Share thereof.
(c) Reimbursement of Payments Under Letters of Credit. Borrower shall
reimburse Issuing Lender through Administrative Agent for any payment that
Issuing Lender makes under a Letter of Credit on or before the date of such
payment; provided, however, that if the conditions precedent set forth in
-------- -------
Section 4.02 can be satisfied, Borrower may request a Borrowing of Loans to
------------
reimburse Issuing Lender for such payment pursuant to Section 2.02, or, failing
------------
to make such request, Borrower shall be deemed to have requested a Borrowing of
Base Rate Loans on such payment date pursuant to subsection (e) below.
(d) Funding by Lenders When Issuing Lender Not Reimbursed. Upon any
drawing under a Letter of Credit, Issuing Lender shall notify Administrative
Agent and Borrower. If Borrower fails to timely make the payment required
pursuant to subsection (c) above, Issuing Lender shall notify Administrative
Agent of such fact and the amount of such unreimbursed payment. Administrative
Agent shall promptly notify each Lender of its Pro Rata Share of such amount by
Requisite Notice. Each Lender shall make funds in an amount equal its Pro Rata
Share of such amount available to Administrative Agent at Administrative Agent's
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<PAGE>
Office not later than the Requisite Time therefor on the Business Day specified
by Administrative Agent. Administrative Agent shall remit the funds so received
to Issuing Lender. The obligation of each Lender to so reimburse Issuing Lender
shall be absolute and unconditional and shall not be affected by the occurrence
of a Default or Event of Default or any other occurrence or event. Any such
reimbursement shall not relieve or otherwise impair the obligation of Borrower
to reimburse Issuing Lender for the amount of any payment made by Issuing Lender
under any Letter of Credit, together with interest as provided herein.
(e) Nature of Lenders' Funding. If the conditions precedent set forth in
Section 4.02 can be satisfied (except for the giving of a Request for Extension
------------
of Credit) on the date Borrower is obligated to make, but fails to make, a
reimbursement of a payment under a Letter of Credit, the funding by Lenders
pursuant to subsection (d) above shall be deemed to be a Borrowing of Base Rate
Loans (without regard to the Minimum Amount therefor) deemed requested by
Borrower. If the conditions precedent set forth in Section 4.02 cannot be
------------
satisfied on the date Borrower is obligated to make, but fails to make, a
reimbursement of a payment under a Letter of Credit, the funding by Lenders
pursuant to subsection (d) above shall be deemed to be a funding by each Lender
of its risk participation in such Letter of Credit, and each Lender making such
funding shall thereupon acquire a pro rata participation, to the extent of its
reimbursement, in the claim of Issuing Lender against Borrower in respect of
such payment and shall share, in accordance with that pro rata participation, in
any payment made by Borrower with respect to such claim. Such funds shall be
payable by Borrower upon demand of Administrative Agent and shall bear interest
at the Default Rate payable on demand.
(f) Special Provisions Relating to Evergreen Letters of Credit. Borrower
may request Letters of Credit that have automatic extension or renewal
provisions ("evergreen" Letters of Credit) so long as Issuing Lender has the
right not to permit any such extension or renewal at least annually within a
notice period to be agreed upon at the time each such Letter of Credit is
issued. If the conditions set forth in Section 4.02 could be satisfied within
------------
such notice period, an evergreen Letter of Credit shall be permitted to
automatically extend or renew in accordance with its terms for the period(s)
specified therein (but not to a date later than the Maturity Date). If the
conditions set forth in Section 4.02 could not be satisfied within such notice
------------
period, Administrative Agent shall notify Borrower, Issuing Lender and each
Lender of such fact. Unless Requisite Lenders (with the consent of Issuing
Lender given in its sole and absolute discretion) decide to allow such Letter of
Credit to nonetheless automatically extend or renew, Issuing Lender shall notify
the beneficiary of such non-extension or nonrenewal.
(g) Obligations Absolute. The obligation of Borrower to pay to Issuing
Lender the amount of any payment made by Issuing Lender under any Letter of
Credit shall be absolute, unconditional, and irrevocable. Without limiting the
foregoing or limiting Borrower's rights to pursue such rights and remedies as it
may have against Issuing Lender, Administrative Agent or any Lender or
beneficiaries of a Letter of Credit, Borrower's obligation shall not be affected
by any of the following circumstances:
(i) any lack of validity or enforceability of the Letter of Credit,
this Agreement, or any other agreement or instrument relating thereto;
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<PAGE>
(ii) any amendment or waiver of or any consent to departure by
Borrower from the Letter of Credit, this Agreement, or any other agreement
or instrument relating hereto or thereto;
(iii) the existence of any claim, setoff, defense, or other rights
which Borrower may have at any time against Issuing Lender, Administrative
Agent or any Lender, any beneficiary of the Letter of Credit (or any
persons or entities for whom any such beneficiary may be acting) or any
other Person, whether in connection with the Letter of Credit, this
Agreement, or any other agreement or instrument relating thereto, or any
unrelated transactions;
(iv) any demand, statement, or any other document presented under
the Letter of Credit proving to be forged, fraudulent, invalid, or
insufficient in any respect or any statement therein being untrue or
inaccurate in any respect whatsoever so long as any such document appeared
to comply with the terms of the Letter of Credit;
(v) payment by Issuing Lender in good faith under the Letter of
Credit against presentation of a draft or any accompanying document which
does not strictly comply with the terms of the Letter of Credit; or any
payment made by Issuing Lender under any Letter of Credit to any Person
purporting to be a trustee in bankruptcy, debtor-in-possession, assignee
for the benefit of creditors, liquidator, receiver or other representative
of or successor to any beneficiary or any transferee of any Letter of
Credit, including any arising in connection with any proceeding under any
Debtor Relief Laws;
(vi) the existence, character, quality, quantity, condition,
packing, value or delivery of any property purported to be represented by
documents presented in connection with any Letter of Credit or for any
difference between any such property and the character, quality, quantity,
condition, or value of such property as described in such documents;
(vii) the time, place, manner, order or contents of shipments or
deliveries of property as described in documents presented in connection
with any Letter of Credit or the existence, nature and extent of any
insurance relative thereto;
(viii) the solvency or financial responsibility of any party issuing
any documents in connection with a Letter of Credit;
(ix) any failure or delay in notice of shipments or arrival of any
property;
(x) any error in the transmission of any message relating to a
Letter of Credit not caused by Issuing Lender, or any delay or interruption
in any such message;
(xi) any error, neglect or default of any correspondent of Issuing
Lender in connection with a Letter of Credit;
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<PAGE>
(xii) any consequence arising from acts of God, wars, insurrections,
civil unrest, disturbances, labor disputes, emergency conditions or other
causes beyond the control of Issuing Lender;
(xiii) so long as Issuing Lender in good faith determines that the
document appears to comply with the terms of the Letter of Credit, the
form, accuracy, genuineness or legal effect of any contract or document
referred to in any document submitted to Issuing Lender in connection with
a Letter of Credit; and
(xiv) where Issuing Lender has acted in good faith under any other
circumstances whatsoever.
In addition, Issuing Lender shall deliver the form of any proposed Letter
of Credit or amendment thereto to Borrower prior to issuing the same to any
beneficiary. Upon Borrower affirmatively notifying Issuing Lender that the same
is acceptable, Issuing Bank shall thereupon issue it to the beneficiary thereof.
After giving any such notice of acceptance, Borrower shall be conclusively
deemed to have waived any claim of noncompliance with Borrower's instructions or
other irregularity in the Letter of Credit against Issuing Lender and its
correspondents with respect to such Letter of Credit or amendment.
(h) Role of Issuing Lender. Each Lender and Borrower Party agree that, in
paying any drawing under a Letter of Credit, Issuing Lender shall not have any
responsibility to obtain any document (other than any sight draft, certificates
and documents expressly required by the Letter of Credit) or to ascertain or
inquire as to the validity or accuracy of any such document or the authority of
the Person executing or delivering any such document. No Administrative Agent-
Related Person nor any of the respective correspondents, participants or
assignees of Issuing Lender shall be liable to any Lender for any action taken
or omitted in connection herewith at the request or with the approval of Lenders
or the Requisite Lenders, as applicable; any action taken or omitted in the
absence of gross negligence or willful misconduct; or the due execution,
effectiveness, validity or enforceability of any document or instrument related
to any Letter of Credit. Borrower hereby assumes all risks of the acts or
omissions of any beneficiary or transferee with respect to its use of any Letter
of Credit; provided, however, that this assumption is not intended to, and shall
-------- -------
not, preclude Borrower's pursuing such rights and remedies as it may have
against the beneficiary or transferee at law or under any other agreement. No
Administrative Agent-Related Person, nor any of the respective correspondents,
participants or assignees of Issuing Lender, shall be liable or responsible for
any of the matters described in subsection (g) above. In furtherance and not in
limitation of the foregoing, Issuing Lender may accept documents that appear on
their face to be in order, without responsibility for further investigation,
regardless of any notice or information to the contrary, and Issuing Lender
shall not be responsible for the validity or sufficiency of any instrument
transferring or assigning or purporting to transfer or assign a Letter of Credit
or the rights or benefits thereunder or proceeds thereof, in whole or in part,
which may prove to be invalid or ineffective for any reason.
(i) Applicability of ISP98 and UCP. Unless otherwise expressly agreed by
the Issuing Lender and Borrower when a Letter of Credit is issued, performance
under Letters of
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<PAGE>
Credit by the Issuing Lender, its correspondents, and beneficiaries will be
governed by the rules of the "International Standby Practices 1998" (ISP98) or
such later revision as may be published by the International Chamber of Commerce
(the "ICC").
---
(j) Letter of Credit Fee. On each Applicable Payment Date, Borrower shall
pay to Administrative Agent in arrears, for the account of each Lender in
accordance with its Pro Rata Share, a Letter of Credit fee in an amount equal to
the indicated Applicable Amount for Letters of Credit times the actual daily
-----
maximum amount available to be drawn under each Letter of Credit since the later
of the Closing Date and the previous Applicable Payment Date. If there is any
change in the Applicable Amount during any quarter, the actual daily amount
shall be computed and multiplied by the Applicable Amount separately for each
period during such quarter that such Applicable Amount was in effect. The
minimum fee for any single Letter of Credit shall be $150 per annum.
(k) Fronting Fee and Documentary and Processing Charges Payable to Issuing
Lender. On each Applicable Payment Date, Borrower shall pay to Administrative
Agent for the sole account of Issuing Lender a fronting fee in an amount equal
to 1/4 of 1% per annum on the actual daily maximum amount available to be drawn
under each Letter of Credit since the later of the Closing Date and the previous
Applicable Payment Date. In addition, Borrower shall pay directly to Issuing
Lender, upon demand, for its sole account its customary documentary and
processing charges in accordance with its standard schedule, as from time to
time in effect, for any Letter of Credit Action or other occurrence relating to
a Letter of Credit for which such charges are customarily made. Such fees and
charges are nonrefundable.
2.04 Swing Line Loans.
(a) Subject to the terms and conditions set forth in this Agreement, Swing
Line Lender agrees to make Swing Line Loans until the Maturity Date in such
amounts as Borrower may from time to time request; provided, however, that (i)
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the aggregate principal amount of all Swing Line Loans shall not exceed the
Swing Line Sublimit at any time, and (ii) the Outstanding Revolving Obligations
of each Lender shall not exceed such Lender's Revolving Commitment and the
Outstanding Revolving Obligations of all Lenders shall not exceed the combined
Revolving Commitments at any time. Swing Line Lender may terminate or suspend
the Swing Line at any time in its sole discretion upon Requisite Notice to
Borrower. Without the consent of all Requisite Lenders and Swing Line Lender,
no Swing Line Loan shall be made during the continuation of a Default or Event
of Default. Borrower may borrow, repay and reborrow under this Section;
provided, however, that Swing Line Lender may terminate or suspend its
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commitment to make new Swing Line Loans at any time in its sole discretion upon
at least 24 hours Requisite Notice to Borrower.
(b) Unless notified to the contrary by Swing Line Lender, Borrower may
request Swing Line Loans in the Minimum Amount therefor upon Requisite Notice
made to Swing Line Lender not later than the Requisite Time therefor. Each such
request for a Swing Line Loan shall constitute a representation and warranty by
Borrower that the conditions set forth in Sections 4.02(a) and (b) are
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satisfied. Promptly after receipt of such request, Swing Line Lender
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shall obtain telephonic verification from the Administrative Agent that there is
availability for such Swing Line Loan under the Revolving Commitments. Upon
receiving such verification, Swing Line Lender shall make such Swing Line Loan
available to Borrower. Upon the making of a Swing Line Loan, each Lender shall
be deemed to have purchased from Swing Line Lender a risk participation therein
in an amount equal to that Lender's Pro Rata Share times the amount of such
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Swing Line Loan.
(c) Swing Line Loans shall bear interest at a fluctuating rate per annum
equal to the rate of interest payable on Base Rate Loans (plus the Applicable
Amount, if any) upon demand of Swing Line Lender and on the Maturity Date.
Swing Line Lender shall be responsible for invoicing Borrower (or notifying
Administrative Agent to so invoice Borrower) for such interest. The interest
payable on Swing Line Loans is solely for the account of Swing Line Lender.
(d) Borrower shall repay each Swing Line Loan on the earliest of (i) the
fifth Business Day after it is made and (ii) the Maturity Date. Borrower shall
repay the principal amount of each Swing Line Loan by payment directly to Swing
Line Lender or by debit at a demand deposit account at the Swing Line Lender not
later than the Requisite Time for payments hereunder. If the conditions
precedent set forth in Section 4.02 can be satisfied, Borrower may request a
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Borrowing of Loans to repay Swing Line Lender pursuant to Section 2.02, or,
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failing to make such request, Borrower shall be deemed to have requested a
Borrowing of Base Rate Loans on such payment date pursuant to subsection (e)
below.
(e) If Borrower fails to timely make any principal of or interest payment
on Swing Line Loans, Swing Line Lender shall notify the Administrative Agent of
such fact and the unpaid amount. The Administrative Agent shall promptly notify
each Lender of its Pro Rata Share of such amount by Requisite Notice. Each
Lender shall make funds in an amount equal its Pro Rata Share of such amount
available to the Administrative Agent at the Administrative Agent's Office not
later than the Requisite Time for payments hereunder on the following Business
Day. The obligation of each Lender to make such payment shall be absolute and
unconditional and shall not be affected by the occurrence of an Event of Default
or any other occurrence or event. Any such payment shall not relieve or
otherwise impair the obligation of Borrower to repay Swing Line Lender for any
amount of Swing Line Loans, together with interest as provided herein.
(f) If the conditions precedent set forth in Section 4.02 can be satisfied
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(except for the giving of a Request for Extension of Credit) on any date
Borrower is obligated to make, but fails to make, a repayment of Swing Line
Loans, the funding by the Lenders pursuant to subsection (d) above shall be
deemed to be part of a Borrowing of Base Rate Loans (without regard to the
Minimum Amount therefor) requested by Borrower. If the conditions precedent set
forth in Section 4.02 cannot be satisfied on the date Borrower is obligated to
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make, but fails to make, such payment, the funding by the Lenders pursuant to
subsection (d) above shall be deemed to be a funding by each Lender of its
participation in such Swing Line Loans, and such funds shall be payable by
Borrower upon demand and shall bear interest at the Default Rate, and each
Lender making such funding shall thereupon acquire a pro rata participation, to
the extent of such payment, in the claim of Swing Line Lender against Borrower
in respect of such payment and
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shall share, in accordance with that pro rata participation, in any payment made
by Borrower with respect to such claim.
2.05 Prepayments.
(a) Optional Prepayments. Upon Requisite Notice to Administrative Agent
not later than the Requisite Time therefor, Borrower may from time to time
voluntarily prepay Loans in part in the Minimum Amount therefor or in full
without premium or penalty. All voluntary prepayments of Term Loans shall be
applied ratably against all remaining Principal Payment Amounts and except as
aforesaid shall be subject to subsection (g) below.
(b) Mandatory Prepayments of Term Loans from Proceeds of Dispositions.
Upon the receipt of any Net Cash Proceeds of any Disposition (other than
Ordinary Course Dispositions) by Borrower or any Subsidiary in excess of
$1,000,000 in the aggregate in any calendar year, Borrower shall promptly prepay
outstanding Term Loans in an amount equal to 100% of such Net Cash Proceeds
(excluding the first $1,000,000). Such prepayments shall be subject to
subsections (f) and (g) below.
(c) Mandatory Prepayments of Term Loans from Proceeds of Insurance. Upon
the receipt of any insurance proceeds by Borrower or any Subsidiary in excess of
$2,000,000 in the aggregate in any calendar year, Borrower shall promptly prepay
outstanding Term Loans in an amount equal to 100% of such proceeds (excluding
the first $2,000,000). Such prepayments shall be subject to subsections (f) and
(g) below.
(d) Mandatory Prepayments of Term Loans from Proceeds of Additional
Equity. Until the Term Loans are paid in full, upon the receipt Borrower or any
Subsidiary of any Net Cash Proceeds of any additional equity issued by Borrower
after the Closing Date (other than Net Cash |
