|
|
|
|
Legal Resources
Business Contracts
MCLE Courses
Projects
Friends
|
Sample Business ContractsHome: Sample Business Contracts:
MULTI-CURRENCY, MULTI-OPTION
CREDIT AGREEMENT
among
HARMAN INTERNATIONAL INDUSTRIES, INCORPORATED
The Subsidiary Borrowers and Subsidiary Guarantors
The Several Lenders
from Time to Time Hereto
CHEMICAL SECURITIES, INC.
as Arranger
NATIONSBANK OF NORTH CAROLINA, N.A.,
as Co-Agent
CHEMICAL BANK
as Administrative Agent
Dated as of September 30, 1994
14
<PAGE>
TABLE OF CONTENTS
-----------------
Page
----
SECTION 1. DEFINITIONS . . . . . . . . . . . . . . . . . . .
2
1.1 Defined Terms . . . . . . . . . . . . . . . . . .
2
1.2 Other Definitional Provisions . . . . . . . . . . 22
SECTION 2. THE COMMITTED RATE LOANS . . . . . . . . . . . . 23
2.1 Committed Rate Loans . . . . . . . . . . . . . . 23
2.2 Procedure for Committed Rate Loan Borrowing . . . 23
2.3 Repayment of Committed Rate Loans; Evidence of
Debt . . . . . . . . . . . . . . . . . . . . 24
2.4 Termination or Reduction of Commitments . . . . . 24
2.5 Optional Prepayments . . . . . . . . . . . . . . . 25
2.6 Conversion and Continuation Options . . . . . . . 25
2.7 Minimum Amounts of Tranches . . . . . . . . . . . 26
2.8 Interest rates and Payment Dates for Committed
Rate Loans . . . . . . . . . . . . . . . . . . 26
2.9 Inability to Determine Interest Rate . . . . . . . 26
SECTION 3. THE COMPETITIVE ADVANCE LOANS . . . . . . . . . . 27
3.1 Competitive Advance Loans . . . . . . . . . . . . 27
3.2 Procedure for Competitive Advance Loan Borrowing . 28
3.3 Repayment of Competitive Advance Loans; Evidence
of Debt . . . . . . . . . . . . . . . . . . . 28
3.4 Prepayments . . . . . . . . . . . . . . . . . . . 28
SECTION 4. THE SWING LINE LOANS . . . . . . . . . . . . . . 29
4.1 Swing Line Loans . . . . . . . . . . . . . . . . . 29
4.2 Procedure for Swing Line Borrowing . . . . . . . . 29
4.3 Repayment of Swing Line Loans; Evidence of Debt . 29
4.4 Allocating Swing Line Loans; Swing Line Loan
Participations . . . . . . . . . . . . . . . . 30
SECTION 5. THE LETTERS OF CREDIT . . . . . . . . . . . . . . 31
5.1 L/C Commitment . . . . . . . . . . . . . . . . . . 31
5.2 Procedure for Issuance of Letters of Credit under
this Agreement . . . . . . . . . . . . . . . . 32
5.3 Fees, Commissions and Other Charges . . . . . . . 33
5.4 L/C Participations . . . . . . . . . . . . . . . . 33
5.5 Reimbursement Obligation of the Borrowers . . . . 34
5.6 Obligations Absolute . . . . . . . . . . . . . . . 35
5.7 Letter of Credit Payments . . . . . . . . . . . . 35
5.8 Application . . . . . . . . . . . . . . . . . . . 36
SECTION 6. CERTAIN PROVISIONS APPLICABLE TO THE LOANS AND
LETTERS OF CREDIT . . . . . . . . . . . . . . 36
15
<PAGE>
Page
----
6.1 Facility Fee . . . . . . . . . . . . . . . . . . . 36
6.2 Computation of Interest and Fees . . . . . . . . . 36
6.3 Pro Rata Treatment and Payments . . . . . . . . . 36
6.4 Illegality . . . . . . . . . . . . . . . . . . . . 38
6.5 Requirements of Law . . . . . . . . . . . . . . . 38
6.6 Taxes . . . . . . . . . . . . . . . . . . . . . . 40
6.7 Indemnity . . . . . . . . . . . . . . . . . . . . 42
6.8 Change of Lending Office . . . . . . . . . . . . . 43
6.9 Company Controls on Exposure; Calculation of
Exposure; Prepayment if Exposure exceeds
Commitments . . . . . . . . . . . . . . . . . 44
SECTION 7. REPRESENTATIONS AND WARRANTIES . . . . . . . . . 45
7.1 Financial Condition . . . . . . . . . . . . . . . 45
7.2 No Change . . . . . . . . . . . . . . . . . . . . 45
7.3 Corporate Existence; Compliance with Law . . . . . 46
7.4 Corporate Power; Authorization; Enforceable
Obligations . . . . . . . . . . . . . . . . . 46
7.5 No Legal Bar . . . . . . . . . . . . . . . . . . . 46
7.6 No Material Litigation . . . . . . . . . . . . . . 47
7.7 No Default . . . . . . . . . . . . . . . . . . . . 47
7.8 Ownership of Property; Liens . . . . . . . . . . . 47
7.9 Intellectual Property . . . . . . . . . . . . . . 47
7.10 Taxes . . . . . . . . . . . . . . . . . . . . . . 47
7.11 Federal Regulations . . . . . . . . . . . . . . . 48
7.12 ERISA . . . . . . . . . . . . . . . . . . . . . . 48
7.13 Investment Company Act; Other Regulations . . . . 49
7.14 Subsidiaries . . . . . . . . . . . . . . . . . . . 49
7.15 Purpose of Loans and Letters of Credit . . . . . . 49
7.16 Accuracy and Completeness of Information . . . . . 49
7.17 Environmental Matters . . . . . . . . . . . . . . 49
SECTION 8. CONDITIONS PRECEDENT
8.1 Conditions to Initial Extensions of Credit . . . . 50
8.2 Conditions to Each Extension of Credit . . . . . . 52
SECTION 9. AFFIRMATIVE COVENANTS
9.1 Financial Statements . . . . . . . . . . . . . . . 53
9.2 Certificates; Other Information . . . . . . . . . 53
9.3 Payment of Obligations . . . . . . . . . . . . . . 54
9.4 Conduct of Business and Maintenance of Existence . 55
9.5 Maintenance of Property; Insurance . . . . . . . . 55
9.6 Inspection of Property; Books and Records;
Discussions . . . . . . . . . . . . . . . . . 55
9.7 Notices . . . . . . . . . . . . . . . . . . . . . 55
9.8 Environmental Laws . . . . . . . . . . . . . . . . 56
- ii -
16
<PAGE>
PAGE
----
SECTION 10. NEGATIVE COVENANTS . . . . . . . . . . . . . . . 57
10.1 Financial Condition Covenants . . . . . . . . . . 57
10.2 Limitation on Indebtedness of Restricted
Subsidiaries . . . . . . . . . . . . . . . . . 57
10.3 Limitation on Liens . . . . . . . . . . . . . . . 58
10.4 Limitation on Fundamental Changes . . . . . . . . 60
10.5 Limitation on Sale of Assets . . . . . . . . . . . 60
10.6 Limitation on Dividends . . . . . . . . . . . . . 61
10.7 Limitation on Investments, Loans and Advances . . 62
10.8 Limitation on Optional Payments of Subordinated
Debt and Modifications of Subordination
Provisions . . . . . . . . . . . . . . . . . . 62
10.9 Limitation on Transactions with Affiliates . . . . 62
10.10 Limitation on Sales and Leasebacks . . . . . . . . 63
10.11 Limitation on Changes in Fiscal Year . . . . . . . 63
10.12 Limitation on Guarantee Obligations in respect
of Indebtedness of Subsidiaries other than
Restricted Subsidiaries . . . . . . . . . . . 63
10.13 Limitation on Subsidiaries other than Restricted
Subsidiaries . . . . . . . . . . . . . . . . . 63
10.14 Limitation on Guarantee Obligations . . . . . . . 63
SECTION 11. GUARANTEES . . . . . . . . . . . . . . . . . . . 63
11.1 Guarantees . . . . . . . . . . . . . . . . . . . . 63
11.2 No Subrogation, Contribution, Reimbursement or
Indemnity . . . . . . . . . . . . . . . . . . 65
11.3 Modification of Obligations . . . . . . . . . . . 66
11.4 Waiver . . . . . . . . . . . . . . . . . . . . . . 66
11.5 Reinstatement . . . . . . . . . . . . . . . . . . 67
11.6 Payment of Obligations . . . . . . . . . . . . . . 68
SECTION 12. EVENTS OF DEFAULT . . . . . . . . . . . . . . . 68
SECTION 13. THE ADMINISTRATIVE AGENT;
THE CO-AGENT AND THE ARRANGER . . . . . . 71
13.1 Appointment . . . . . . . . . . . . . . . . . . . 71
13.2 Delegation of Duties . . . . . . . . . . . . . . . 71
13.3 Exculpatory Provisions . . . . . . . . . . . . . . 71
13.4 Reliance by Administrative Agent . . . . . . . . . 72
13.5 Notice of Default . . . . . . . . . . . . . . . . 72
13.6 Non-Reliance on Administrative Agent and Other
Lenders . . . . . . . . . . . . . . . . . . . 73
13.7 Indemnification . . . . . . . . . . . . . . . . . 73
13.8 Administrative Agent in Its Individual Capacity . 74
13.9 Successor Administrative Agent . . . . . . . . . . 74
13.10 Co-Agent and Arranger . . . . . . . . . . . . . . 75
- iii -
17
<PAGE>
PAGE
----
SECTION 14. MISCELLANEOUS . . . . . . . . . . . . . . . . . 75
14.1 Amendments and Waivers Generally; Amendments to
Schedules II and III . . . . . . . . . . . . . 75
14.2 Notices . . . . . . . . . . . . . . . . . . . . . 77
14.3 No Waiver; Cumulative Remedies . . . . . . . . . . 78
14.4 Survival of Representations and Warranties . . . . 78
14.5 Payment of Expenses and Taxes . . . . . . . . . . 78
14.6 Successors and Assigns; Participations and
Assignments . . . . . . . . . . . . . . . . . 79
14.7 Adjustments; Set-off . . . . . . . . . . . . . . . 81
14.8 Power of Attorney . . . . . . . . . . . . . . . . 82
14.9 Judgement . . . . . . . . . . . . . . . . . . . . 83
14.10 Counterparts . . . . . . . . . . . . . . . . . . . 83
14.11 Severability . . . . . . . . . . . . . . . . . . . 83
14.12 Integration . . . . . . . . . . . . . . . . . . . 83
14.13 GOVERNING LAW . . . . . . . . . . . . . . . . . . 84
14.14 Submission To Jurisdiction; Waivers . . . . . . . 84
14.15 Acknowledgements . . . . . . . . . . . . . . . . . 84
14.16 WAIVERS OF JURY TRIAL . . . . . . . . . . . . . . 85
14.17 Confidentiality . . . . . . . . . . . . . . . . . 85
- iv -
18
<PAGE>
SCHEDULES
Schedule I: Lenders and Commitments
Schedule II: Subsidiary Borrowers and Subsidiary
Guarantors
Schedule III: Swing Line Lenders and Issuing Banks
Schedule IV: Administrative Schedule
Schedule V: Description of Studer Transaction
Schedule VI: Material Debt Instruments
Schedule 7.14: Subsidiaries
Schedule 10.2: Existing Indebtedness and Liens
EXHIBITS
EXHIBIT A: Joinder Agreement
EXHIBIT B: Schedule Agreement
EXHIBIT C: Form of Borrowing Certificate
EXHIBIT D: Assignment and Acceptance
EXHIBIT E-1 Opinion of Jones, Day, Reavis & Pogue
EXHIBIT E-2 Opinion of General Counsel
EXHIBIT E-3 Opinions Relating to Foreign
Subsidiary Borrowers
- v -
19
<PAGE>
MULTI-CURRENCY, MULTI-OPTION CREDIT AGREEMENT, dated as
of September 30, 1994, among:
(i) HARMAN INTERNATIONAL INDUSTRIES, INCORPORATED, a Delaware
corporation (the "Company");
(ii) the DOMESTIC SUBSIDIARY BORROWERS (as hereinafter
defined);
(iii) the FOREIGN SUBSIDIARY BORROWERS (as hereinafter
defined);
(iv) the SUBSIDIARY GUARANTORS (as hereinafter defined);
(v) the several banks and other financial institutions from
time to time parties to this Agreement (each, a "Lender"; and
collectively, the "Lenders");
(vi) CHEMICAL SECURITIES INC., as Arranger (the "Arranger");
(vii) NATIONSBANK OF NORTH CAROLINA, N.A., as Co-Agent (in
such capacity, the "Co-Agent"); and
(viii) CHEMICAL BANK, a New York banking corporation
("Chemical"), as administrative agent for the Lenders
hereunder (and its successors in such capacity, the
"Administrative Agent").
W I T N E S S E T H:
WHEREAS, the Company has requested the Lenders to make
available a credit facility pursuant to which (i) the Company and
the Subsidiary Borrowers (as hereinafter defined) may borrow
revolving credit loans and swing line loans at committed interest
rates, and short-term loans at interest rates determined by a
competitive bidding process to be conducted by the Company or a
Subsidiary Borrower and (ii) one or more Issuing Banks (as
hereinafter defined) will issue letters of credit for the account
of the Company or a Subsidiary Borrower, and each of the Lenders
will acquire a participating interest in each such letter of
credit;
WHEREAS, the Company has requested that the loans made,
and letters of credit issued, under this Agreement be denominated,
at the option of the Company or the relevant Subsidiary Borrower,
as the case may be, in United States Dollars or Available Foreign
Currencies (as hereinafter defined); and
WHEREAS, the Lenders are willing to make such credit
facility available;
NOW, THEREFORE, in consideration of the premises and the
mutual agreements herein contained, the parties hereto hereby agree
as follows:
20
<PAGE>
2
SECTION 1. DEFINITIONS
1.1 Defined Terms. As used in this Agreement, the
following terms shall have the following meanings:
"ABR": for any day, a rate per annum (rounded upwards,
if necessary, to the next 1/16 of 1%) equal to the greatest of
(a) the Prime Rate in effect on such day, (b) the Base CD Rate
in effect on such day plus 1% and (c) the Federal Funds
Effective Rate in effect on such day plus 1/2 of 1%. For
purposes hereof: "Prime Rate" shall mean the rate of interest
per annum publicly announced from time to time by Chemical as
its prime rate in effect at its principal office in New York
City (the Prime Rate not being intended to be the lowest rate
of interest charged by Chemical in connection with extensions
of credit to debtors); "Base CD Rate" shall mean the sum of
(a) the product of (i) the Three-Month Secondary CD Rate and
(ii) a fraction, the numerator of which is one and the
denominator of which is one minus the C/D Reserve Percentage
and (b) the C/D Assessment Rate; "Three-Month Secondary CD
Rate" shall mean, for any day, the secondary market rate for
three-month certificates of deposit reported as being in
effect on such day (or, if such day shall not be a Business
Day, the next preceding Business Day) by the Board of
Governors of the Federal Reserve System (the "Board") through
the public information telephone line of the Federal Reserve
Bank of New York (which rate will, under the current practices
of the Board, be published in Federal Reserve Statistical
Release H.15(519) during the week following such day), or, if
such rate shall not be so reported on such day or such next
preceding Business Day, the average of the secondary market
quotations for three-month certificates of deposit of major
money center banks in New York City received at approximately
10:00 A.M., New York City time, on such day (or, if such day
shall not be a Business Day, on the next preceding Business
Day) by the Administrative Agent from three New York City
negotiable certificate of deposit dealers of recognized
standing selected by it; and "Federal Funds Effective Rate"
shall mean, for any day, the weighted average of the rates on
overnight Federal funds transactions with members of the
Federal Reserve System arranged by Federal funds brokers, as
published on the next succeeding Business Day by the Federal
Reserve Bank of New York, or, if such rate is not so published
for any day which is a Business Day, the average of the
quotations for the day of such transactions received by the
Administrative Agent from three Federal funds brokers of
recognized standing selected by it.
"ABR Loans": Loans in Dollars bearing interest based
upon the ABR.
21
<PAGE>
3
"Administrative Schedule": Schedule IV to this
Agreement, which contains interest rate definitions and
administrative information in respect of each Currency and
each Type of Loan.
"Affiliate": as to any Person, any other Person (other
than a Subsidiary) which, directly or indirectly, is in
control of, is controlled by, or is under common control with,
such Person. For purposes of this definition, "control" of a
Person means the power, directly or indirectly, either to (a)
vote 10% or more of the securities having ordinary voting
power for the election of directors of such Person or (b)
direct or cause the direction of the management and policies
of such Person, whether by contract or otherwise.
"Agreement": this Multi-Currency, Multi-Option Credit
Agreement, as amended, supplemented or otherwise modified from
time to time.
"Applicable Margin": for each day during each Interest
Period in respect of any Eurocurrency Loan, the margin per
annum set forth below opposite the EBITDA Ratio shown on the
last EBITDA Ratio Certificate delivered pursuant to subsection
9.2(c) prior to such day:
EBITDA Ratio Applicable Margin
Greater than or
equal to 6.5 to 1.0 .20%
Greater than or equal
to 5.5 to 1.0 but lower
than 6.5 to 1.0 .25%
Greater than or equal to
4.25 to 1.0 but lower than
5.5 to 1.0 .30%
Greater than or equal to
3.0 to 1.0 but lower than
4.25 to 1.0 .375%
Lower than 3.0 to 1.0 .50%
; provided, however, that, (i) in the event that no EBITDA
Ratio Certificate has been delivered for a fiscal quarter
prior to the last date on which it can be delivered without
violation of subsection 9.2(c), the Applicable Margin from
such date until such EBITDA Ratio Certificate is actually
delivered shall be that applicable when the EBITDA Ratio is
lower than 3.0 to 1.0 and (ii) in the event that the actual
EBITDA Ratio for any fiscal quarter is subsequently
22
<PAGE>
4
determined to be less than that set forth in the EBITDA Ratio
Certificate for such fiscal quarter, the Applicable Margin
shall be recalculated for the applicable period based upon
such actual EBITDA Ratio. Changes in the Applicable Margin,
if any, resulting from the operation of clause (ii) above
shall be given effect through adjustments in subsequent
payments of interest so as to give effect to such Applicable
Margin retroactively to the applicable period.
"Application": in respect of each Letter of Credit
issued by an Issuing Bank, an application, in such form as
such Issuing Bank may specify from time to time, requesting
issuance of such Letter of Credit.
"Assignee": as defined in subsection 14.6(c).
"Assignment and Acceptance": such Assignment and
Acceptance, substantially in the form of Exhibit D, executed
and delivered pursuant to subsection 14.6(c).
"Available Foreign Currencies": Deutsche Marks, Pounds
Sterling, Hong Kong Dollars, Singapore Dollars, Belgian
Francs, French Francs, Austrian Schillings, Danish Kroner,
Japanese Yen, Swiss Francs, and any other available and
freely-convertible foreign currency selected by the Company
and approved by the Administrative Agent in the manner
described in subsection 14.1(b).
"Borrowers": the collective reference to the Company and
the Subsidiary Borrowers.
"Borrowing Date": any Business Day on which a Loan is to
be made at the request of a Borrower under this Agreement.
"Business": as defined in subsection 7.17.
"Business Day": (a) when such term is used in respect of
a day on which a Loan in an Available Foreign Currency is to
be made, a payment is to be made in respect of such Loan or
any other dealing in such Available Foreign Currency is to be
carried out pursuant to this Agreement, such term shall mean
a
London Banking Day which is also a day on which banks are open
for general banking business in the city which is the
principal financial center of the country of such Available
Foreign Currency, (b) when such term is used to describe a day
on which a request is to be made to an Issuing Bank for
issuance of a Letter of Credit or on which a Letter of Credit
is to be issued, such term shall mean a day other than a
Saturday, Sunday or other day on which commercial banks in the
city in which such Issuing Bank's Issuing Office is located
and (c) when such term is used in any other context in this
Agreement, such term shall mean a day other than a Saturday,
Sunday or other day on which
23
<PAGE>
5
commercial banks in New York City are authorized or required
by law to close.
"Capital Stock": any and all shares, interests,
participations or other equivalents (however designated) of
capital stock of a corporation, any and all equivalent
ownership interests in a Person (other than a corporation) and
any and all warrants or options to purchase any of the
foregoing.
"Cash-Equivalents": (a) securities with maturities of
one year or less from the date of acquisition issued or fully
guaranteed or insured by the United States Government or any
agency thereof; (b) marketable general obligations issued by
any state of the United States of America or any political
subdivision of any such state or any public instrumentality
thereof maturing within one year from the date of acquisition
thereof and, at the time of acquisition, having one of the two
highest credit ratings from either Standard & Poor's
Corporation or Moody's Investors Service, Inc.; (c)
certificates of deposit, time deposits, eurodollar time
deposits, overnight bank deposits, bankers' acceptances and
repurchase agreements having maturities of one year or less
from the date of acquisition issued, and money market deposit
accounts issued or offered by any Lender or by any commercial
bank organized under the laws of the United States of America
or any state thereof having combined capital and surplus of
not less than $100,000,000; and (d) commercial paper of an
issuer rated at least A-2 by Standard & Poor's Corporation or
P-2 by Moody's Investors Service, Inc., or carrying an
equivalent rating by a nationally recognized rating agency, if
both of the two named rating agencies cease publishing ratings
of investments, and, in either case, maturing within one year
from the date of acquisition.
"C/D Assessment Rate": for any day, the annual
assessment rate in effect on such day which is payable by a
member of the Bank Insurance Fund maintained by the Federal
Deposit Insurance Corporation (the "FDIC") classified as well-
capitalized and within supervisory subgroup "B" (or a
comparable successor assessment risk classification) within
the meaning of 12 C.F.R. 327.3(d) (or any successor
provision) to the FDIC (or any successor) for the FDIC's (or
such successor's) insuring time deposits at offices of such
institution in the United States.
"C/D Reserve Percentage": for any day, that percentage
(expressed as a decimal) which is in effect on such day, as
prescribed by the Board of Governors of the Federal Reserve
System (or any successor) (the "Board"), for determining the
maximum reserve requirement for a Depositary Institution (as
defined in Regulation D of the Board) in respect of new
24
<PAGE>
6
non-personal time deposits in Dollars having a maturity of 30
days or more.
"Change of Control": an event or series of events by
which (i) any "person" or "group" (as such terms are defined
in Sections 13(d) and 14(d) of the Securities Exchange Act of
1934, as amended), other than the Permitted Investor, is or
becomes the "beneficial owner" (as defined in Rules 13d-3 and
13d-5 under the Exchange Act, except that a Person shall be
deemed to have "beneficial ownership" of all shares that any
such Person has the right to acquire without condition, other
than passage of time, whether such right is exercisable
immediately or only after the passage of time), directly or
indirectly, of more than 50% of the total voting power of the
then outstanding Voting Stock of the Company, (ii)(A) the
Company consolidates with or merges into another corporation
or conveys, transfers or leases all or substantially all of
its properties and assets (determined on a consolidated basis
for the Company and its Subsidiaries taken as a whole) to any
Person, or (B) any corporation consolidates with or merges
into the Company or a Subsidiary of the Company in a
transaction in which the outstanding Voting Stock of the
Company is changed into or exchanged for cash, securities or
other property, other than a transaction solely between the
Company and a Subsidiary of the Company or (iii) during any
period of two consecutive years, individuals who at the
beginning of such period constituted the Board of Directors of
the Company (together with any new directors whose election by
such Board of Directors or whose nomination for election by
the shareholders of the Company was approved by a vote of 66
2/3% of the directors then still in office who were either
directors at the beginning of such period or whose election or
nomination for election was previously so approved) cease for
any reason to constitute a majority of the Board of Directors
of the Company then in office; provided, however, that
notwithstanding anything to the contrary in this definition,
transfer of beneficial ownership of shares held by the
Permitted Investor upon the death of the Permitted Investor to
the heirs and devisees of the Permitted Investor shall not
constitute a Change of Control.
"Chemical": Chemical Bank.
"Closing Date": the date on or before October 31, 1994
on which the conditions precedent set forth in subsection 8.1
shall be satisfied.
"Code": the Internal Revenue Code of 1986, as amended
from time to time.
"Commercial Letter of Credit": as defined in subsection
5.1(b).
25
<PAGE>
7
"Commitment": as to any Lender, the obligation of such
Lender to make and/or acquire participating interests in Loans
and issue and/or acquire participating interests in Letters of
Credit hereunder in an aggregate Dollar Equivalent Amount at
any one time outstanding not to exceed the amount set forth
opposite such Lender's name on Schedule I, as such amount may
be changed from time to time in accordance with the provisions
of this Agreement.
"Commitment Percentage": as to any Lender at any time,
the percentage which such Lender's Commitment then constitutes
of the aggregate Commitments (or, at any time after the
Commitments shall have expired or terminated, the percentage
which the amount of such Lender's Exposure then outstanding
constitutes of the aggregate amount of the Exposure of all the
Lenders then outstanding).
"Commitment Period": the period from and including the
Closing Date to but not including the Termination Date or such
earlier date on which the Commitments shall terminate as
provided herein.
"Committed Rate Loan": as defined in subsection 2.1; a
Committed Rate Loan bearing interest based upon the ABR shall
be a "Committed Rate ABR Loan", and a Committed Rate Loan
bearing interest based upon the Eurocurrency Rate shall be a
"Committed Rate Eurocurrency Loan".
"Commonly Controlled Entity": an entity, whether or not
incorporated, which is under common control with the Company
within the meaning of Section 4001 of ERISA or is part of a
group which includes the Company and which is treated as a
single employer under Section 414(b), (c), (m) or (o) of the
Code.
"Company Obligations": the unpaid principal of and
interest on the Loans made to the Company, all Reimbursement
Obligations in respect of Letters of Credit issued for the
account of the Company and all other obligations and
liabilities of the Company to the Administrative Agent, any
Issuing Bank or any Lender (including, without limitation,
interest accruing after the maturity or earlier acceleration
of the Loans and interest accruing after the filing of any
petition in bankruptcy, or the commencement of any insolvency,
reorganization or like proceeding, relating to the Company,
whether or not a claim for post-filing or post petition
interest is allowed in such proceeding), whether direct or
indirect, absolute or contingent, due or to become due, now
existing or hereafter incurred, which may arise under, out of,
or in connection with, this Agreement, the Loans, the Letters
of Credit, or any other document made, delivered or given in
connection therewith, in each case whether on account of
principal, interest, reimbursement obligations, fees,
indemnities, costs, expenses (including,
26
<PAGE>
8
without limitation, all fees and disbursements of counsel to
the Administrative Agent, any Issuing Bank or any Lender) or
otherwise.
"Competitive Advance Loan": as defined in subsection
3.1.
"Consolidated Capitalization": at any date, the sum of
(i) shareholders' equity of the Company and (without
duplication) its consolidated Subsidiaries, determined on a
consolidated basis in accordance with GAAP, and (ii)
Consolidated Total Debt; provided, that the Studer Preferred
Stock shall not be included in determining shareholders'
equity of the Company and its consolidated Subsidiaries.
"Consolidated EBITDA": for any period, Consolidated Net
Income for such period, plus the amount of taxes, interest,
depreciation and amortization deducted from earnings in
determining such Consolidated Net Income.
"Consolidated Interest Expense": for any period, the
amount of interest expense deducted from earnings of the
Company and its consolidated Subsidiaries in determining
Consolidated Net Income for such period in accordance with
GAAP.
"Consolidated Net Income": for any fiscal period, the
net income of the Company and its Subsidiaries, determined on
a consolidated basis in accordance with GAAP minus Studer
Dividends.
"Consolidated Senior Debt": at any date, Consolidated
Total Debt less the outstanding principal amount of
Subordinated Debt.
"Consolidated Total Assets": at any date, the aggregate
amount of the assets of the Company and its consolidated
Subsidiaries, determined on a consolidated basis in accordance
with GAAP; provided, that the Studer Assets shall not be
included in determining Consolidated Total Assets.
"Consolidated Total Debt": at any date, without
duplication, the aggregate of all Indebtedness (including the
current portion thereof) of the Company and its consolidated
Subsidiaries, determined on a consolidated basis in accordance
with GAAP; provided, that the obligations of the Company and
Studer in respect of the Studer L/C shall not be included in
determining Consolidated Total Debt.
"Contractual Obligation": as to any Person, any
provision of any security issued by such Person or of any
material agreement, instrument or other undertaking to which
<PAGE>
27
<PAGE>
9
such Person is a party or by which it or any of its property
is bound.
"Currencies": the collective reference to Dollars and
the Available Foreign Currencies.
"Default": any event or condition that upon notice, the
lapse of time, or both, would constitute an Event of Default.
"Dividend": the quarterly dividend of $0.04 per share of
Common Stock paid by the Company on August 15, 1994 to each
holder of record as of July 29, 1994.
"Dollar Equivalent Amount": with respect to the amount
of any Available Foreign Currency on any date, the equivalent
amount in Dollars of such amount of Available Foreign
Currency, as determined by the Administrative Agent using the
Exchange Rate.
"Dollars" and "$": dollars in lawful currency of the
United States of America.
"Domestic Subsidiary Borrower": each Subsidiary of the
Company which is organized under the laws of the District of
Columbia or a State of the United States and listed as a
Domestic Subsidiary Borrower on Schedule II.
"EBITDA Ratio": on any date, the ratio of Consolidated
EBITDA to Consolidated Interest Expense for the four
consecutive fiscal quarters of the Company most recently ended
prior to such date.
"EBITDA Ratio Certificate": as defined in subsection
9.2(c).
"Environmental Laws": any and all applicable material,
foreign, Federal, state, local or municipal laws, rules,
orders, regulations, statutes, ordinances, codes, decrees,
enforceable requirements of any Governmental Authority or
other Requirements of Law (including common law) regulating,
relating to or imposing liability or standards of conduct
concerning protection of human health or the environment, as
now or may at any time hereafter be in effect.
"ERISA": the Employee Retirement Income Security Act of
1974, as amended from time to time.
"Eurocurrency Loan": any Loan bearing interest based
upon a Eurocurrency Rate.
"Eurocurrency Rate": in respect of each Currency, the
rate determined as the Eurocurrency Rate for such Currency in
the manner set forth in the Administrative Schedule.
28
<PAGE> 10
"Event of Default": any of the events specified in
Section 12, provided that any requirement for the giving of
notice, the lapse of time, or both, or any other condition,
has been satisfied.
"Exchange Rate": with respect to any Available Foreign
Currency on any date, the rate at which such Available Foreign
Currency may be exchanged into Dollars, as set forth on such
date on the relevant Reuters currency page at or about 11:00
A.M. London time on such date. In the event that such rate
does not appear on any Reuters currency page, the "Exchange
Rate" with respect to such Available Foreign Currency shall be
determined by reference to such other publicly available
service for displaying exchange rates as may be agreed upon by
the Administrative Agent and the Company or, in the absence of
such agreement, such "Exchange Rate" shall instead be the
Administrative Agent's spot rate of exchange in the interbank
market where its foreign currency exchange operations in
respect of such Available Foreign Currency are then being
conducted, at or about 10:00 A.M., local time, at such date
for the purchase of Dollars with such Available Foreign
Currency, for delivery two Business Days later; provided, that
if at the time of any such determination, no such spot rate
can reasonably be quoted, the Administrative Agent may use any
reasonable method as it deems applicable to determine such
rate, and such determination shall be conclusive absent
manifest error.
"Exposure": at any date, the aggregate Dollar Equivalent
Amount of (a) all Loans then outstanding and (b) all L/C
Obligations then outstanding.
"Extensions of Credit": the collective reference to
Loans made and Letters of Credit issued under this Agreement.
"Facility Fee Rate": for each day during each fiscal
quarter of the Company, the rate per annum set forth below
opposite the EBITDA Ratio shown on the EBITDA Ratio
Certificate required pursuant to subsection 9.2(c) to be
delivered for the immediately preceding fiscal quarter:
EBITDA Ratio Facility Fee Rate
Greater than or
equal to 6.5 to 1.0 .10%
Greater than or equal
to 5.5 to 1.0 but lower
than 6.5 to 1.0 .15%
Greater than or equal to
4.25 to 1.0 but lower than
29
<PAGE>
11
5.5 to 1.0 .20%
Greater than or equal to
3.0 to 1.0 but lower than
4.25 to 1.0 .25%
Lower than 3.0 to 1.0 .375%
; provided, however, that, (i) in the event that no EBITDA
Ratio Certificate has been delivered for a fiscal quarter
prior to the last day of the next succeeding fiscal quarter,
the Facility Fee Rate during such next succeeding fiscal
quarter shall be that applicable when the EBITDA Ratio is
lower than 3.0 to 1.0 and (ii) in the event that the actual
EBITDA Ratio for any fiscal quarter is subsequently determined
to be less than that set forth in the EBITDA Ratio Certificate
for such fiscal quarter, the Facility Fee Rate during the
fiscal quarter next succeeding the fiscal quarter in respect
of which such EBITDA Ratio has been determined shall be
determined based upon such actual EBITDA Ratio. Changes in
the Facility Fee Rate, if any, resulting from the operation of
any of clauses (i) or (ii) above for any fiscal quarter shall
be given effect through adjustments in subsequent payments of
facility fee so as to give effect to such Facility Fee Rate
retroactively to the beginning of such fiscal quarter.
"Fee Letter": the letter agreement, dated August 16,
1994, between the Company and Chemical.
"Financing Lease": any lease of property, real or
personal, the obligations of the lessee in respect of which
are required in accordance with GAAP to be capitalized on a
balance sheet of the lessee.
"Foreign Subsidiary Borrower": each Subsidiary of the
Company which is organized under the laws of a jurisdiction
other than the District of Columbia or a State of the United
States and listed as a Foreign Subsidiary Borrower on Schedule
II.
"Foreign Subsidiary Obligations": the unpaid principal of
and interest on the Loans made to the Foreign Subsidiary
Borrowers, all Reimbursement Obligations in respect of Letters
of Credit issued for the account of the Foreign Subsidiary
Borrowers and all other obligations and liabilities of the
Foreign Subsidiary Borrowers to the Administrative Agent, any
Issuing Bank or any Lender (including, without limitation,
interest accruing after the maturity or earlier acceleration
of such Loans and interest accruing after the filing of any
petition in bankruptcy, or the commencement of any insolvency,
reorganization or like proceeding, relating to any Foreign
Subsidiary Borrower, whether or not a claim for post-filing or
post petition
30
<PAGE> 12
interest is allowed in such proceeding), whether direct or
indirect, absolute or contingent, due or to become due, now
existing or hereafter incurred, which may arise under, out of,
or in connection with, this Agreement, the Loans, the Letters
of Credit, or any other document made, delivered or given in
connection therewith, in each case whether on account of
principal, interest, reimbursement obligations, fees,
indemnities, costs, expenses (including, without limitation,
all fees and disbursements of counsel to the Administrative
Agent, any Issuing Bank or any Lender) or otherwise.
"Funding Office": for each Type of Loan and each
Currency, the Funding Office set forth in respect thereof in
the Administrative Schedule.
"Funding Time": for each Type of Loan and each Currency,
the Funding Time set forth in respect thereof in the
Administrative Schedule.
"GAAP": generally accepted accounting principles in the
United States of America in effect from time to time.
"Governmental Authority": any nation or government, any
state or other political subdivision thereof and any entity
exercising applicable executive, legislative, judicial,
regulatory or administrative functions of or pertaining to
government.
"Guarantee Obligation": as to any Person (the
"guaranteeing person"), any obligation of (a) the guaranteeing
person or (b) another Person (including, without limitation,
any bank under any letter of credit) to induce the creation of
which the guaranteeing person has issued a reimbursement,
counterindemnity or similar obligation, in either case
guaranteeing or in effect guaranteeing any Indebtedness,
leases, dividends or other obligations (the "primary
obligations") of any other third Person (the "primary
obligor") in any manner, whether directly or indirectly,
including, without limitation, any obligation of the
guaranteeing person, whether or not contingent, (i) to
purchase any such primary obligation or any property
constituting direct or indirect security therefor, (ii) to
advance or supply funds (1) for the purchase or payment of any
such primary obligation or (2) to maintain working capital or
equity capital of the primary obligor or otherwise to maintain
the net worth or solvency of the primary obligor, (iii) to
purchase property, securities or services primarily for the
purpose of assuring the owner of any such primary obligation
of the ability of the primary obligor to make payment of such
primary obligation or (iv) otherwise to assure or hold
harmless the owner of any such primary obligation against loss
in respect thereof; provided, however, that the term Guarantee
31
<PAGE>
13
Obligation shall not include (x) endorsements of instruments
for deposit or collection in the ordinary course of business
or (y) obligations of the Company or any of its Subsidiaries
under arrangements entered into in the ordinary course of
business whereby the Company or such Subsidiary sells
inventory to other Persons under agreements obligating the
Company or such Subsidiary to repurchase such inventory, at a
price not exceeding the original sale price, upon the
occurrence of certain specified events. The amount of any
Guarantee Obligation of any guaranteeing person shall be
deemed to be the lower of (a) an amount equal to the stated or
determinable amount of the primary obligation in respect of
which such Guarantee Obligation is made and (b) the maximum
amount for which such guaranteeing person may be liable
pursuant to the terms of the instrument embodying such
Guarantee Obligation, unless such primary obligation and the
maximum amount for which such guaranteeing person may be
liable are not stated or determinable, in which case the
amount of such Guarantee Obligation shall be such guaranteeing
person's maximum reasonably anticipated liability in respect
thereof as determined by the Company in good faith.
"Guarantor": each Subsidiary Guarantor and the Company
and each Subsidiary Borrower in its capacity as a guarantor
pursuant to Section 11 of this Agreement.
"Implied Senior Long-Term Debt Rating": in the case
where the Company has no long-term, senior, unsecured, non-
credit enhanced debt that is the subject of a current rating
by either Standard & Poor's Ratings Group or Moody's Investors
Service, Inc., then the Company's implied senior, unsecured,
long-term debt rating, as determined and made publicly-
available from time to time by Standard & Poor's Ratings Group
or Moody's Investors Service, Inc.
"Indebtedness": of any Person at any date, all
indebtedness or obligations of such Person (other than current
trade liabilities incurred in the ordinary course of business
and payable in accordance with customary practices), as
reflected on the balance sheet of such Person prepared in
accordance with GAAP.
"Insolvency": with respect to any Multiemployer Plan,
the condition that such Plan is insolvent within the meaning
of Section 4245 of ERISA.
"Insolvent": pertaining to a condition of Insolvency.
"Interest Payment Date": (a) as to any ABR Loan, the
last day of each March, June, September and December to occur
while such Loan is outstanding, (b) as to any Committed Rate
Eurocurrency Loan having an Interest Period of three months or
less, the last day of such Interest
32
<PAGE> 14
Period, (c) as to any Committed Rate Eurocurrency Loan having
an Interest Period longer than three months, each day which is
three months after the first day of such Interest Period and
the last day of such Interest Period, (d) as to any Swing Line
Loan, the last Business Day of each calendar month during
which such Swing Line Loan is outstanding and the date of
repayment thereof, and (e) as to any Competitive Advance Loan,
the date or dates agreed upon by the relevant Borrower and
Lender at the time the terms of such Competitive Advance Loan
are determined as provided in Section 3.
"Interest Period": with respect to any Committed Rate
Eurocurrency Loan:
(i) initially, the period commencing on the
borrowing, continuation or conversion date, as the case
may be, with respect to such Eurocurrency Loan and ending
one, two, three or six months thereafter, as selected by
the relevant Borrower in its Notice of Borrowing, Notice
of Continuation or Notice of Conversion, as the case may
be, given with respect thereto; and
(ii) thereafter, each period commencing on the
last day of the next preceding Interest Period applicable
to such Eurocurrency Loan and ending one, two, three or
six months thereafter, as selected by the relevant
Borrower by a Notice of Continuation with respect
thereto;
provided that, all of the foregoing provisions relating to
Interest Periods are subject to the following:
(1) if any Interest Period would otherwise end on
a day that is not a Business Day, such Interest Period
shall be extended to the next succeeding Business Day
unless the result of such extension would be to carry
such Interest Period into another calendar month in which
event such Interest Period shall end on the immediately
preceding Business Day;
(2) any Interest Period that would otherwise
extend beyond the Termination Date shall end on the
Termination Date; and
(3) any Interest Period that begins on the last
Business Day of a calendar month (or on a day for which
there is no numerically corresponding day in the calendar
month at the end of such Interest Period) shall end on
the last Business Day of a calendar month.
"Investment Grade": the Company shall be deemed to be
Investment Grade when its long-term, senior, unsecured, non-
33
<PAGE>
15
credit enhanced debt is rated or, when the Company has no
long-term, senior, unsecured, non-credit enhanced debt that is
the subject of a rating, then its Implied Senior Long-Term
Debt Rating is, at least BBB- by Standard & Poor's Ratings
Group or at least Baa3 by Moody's Investors Service, Inc.
"Issuing Bank": each Lender listed as an Issuing Bank in
Schedule III.
"Issuing Office": in respect of each Issuing Bank, the
Issuing Office set forth for such Issuing Bank in Schedule
III.
"Joinder Agreement": each Joinder Agreement,
substantially in the form of Exhibit A, from time to time
executed and delivered hereunder pursuant to subsection 14.1
(b).
"L/C Obligations": at any time, an amount equal to the
sum of (a) the aggregate then undrawn and unexpired amount of
the then outstanding Letters of Credit and (b) the aggregate
amount of drawings under Letters of Credit which have not then
been reimbursed pursuant to subsection 5.5(a).
"L/C Participant": in respect of each Letter of Credit,
each Lender (other than the Issuing Bank in respect of such
Letter of Credit) in its capacity as the holder of a
participating interest in such Letter of Credit.
"Letter of Credit": as defined in subsection 5.1.
"Lien": any mortgage, pledge, hypothecation, assignment,
deposit arrangement, encumbrance, lien (statutory or other),
charge or other security interest or any preference, priority
or other security agreement or preferential arrangement of any
kind or nature whatsoever (including, without limitation, any
conditional sale or other title retention agreement and any
Financing Lease having substantially the same economic effect
as any of the foregoing).
"Loan": any Committed Rate Loan, Competitive Advance
Loan or Swing Line Loan made by any Lender pursuant to this
Agreement.
"Loan Documents": this Agreement and each Joinder
Agreement.
"Loan Parties": the Borrowers and the Subsidiary
Guarantors.
34
<PAGE> 16
"London Banking Day": any day on which banks in London
are open for general banking business, including dealings in
foreign currency and exchange.
"Majority Lenders": at any time, Lenders the Commitment
Percentages of which aggregate more than 50%.
"Material Adverse Effect": a material adverse effect on
(a) the business, operations, property or condition (financial
or otherwise) of the Company and its Subsidiaries taken as a
whole or (b) the validity or enforceability of this or any of
the other Loan Documents or the rights or remedies of the
Administrative Agent or the Lenders hereunder or thereunder.
"Material Debt Instrument": those agreements and other
instruments of Indebtedness listed on Schedule VI, which list
shall include any such instrument under which any Loan Party
is an obligor and under which the outstanding amount and/or
available commitment to extend credit exceeds $10,000,000.
"Materials of Environmental Concern": any gasoline or
petroleum (including crude oil or any fraction thereof) or
petroleum products or any hazardous or toxic substances,
materials or wastes, defined or regulated as such in or under
any Environmental Law, including, without limitation,
asbestos, polychlorinated biphenyls and urea-formaldehyde
insulation.
"Multiemployer Plan": a Plan which is a multiemployer
plan as defined in Section 4001(a)(3) of ERISA.
"Non-Excluded Taxes": as defined in subsection 6.6.
"Notice of Borrowing": with respect to a Loan of any
Type in any Currency, a notice from the Borrower in respect of
such Loan, containing the information in respect of such Loan
and delivered to the Person, in the manner and by the time
specified for a Notice of Borrowing in respect of such
Currency and such Type of Loan in the Administrative Schedule.
"Notice of Competitive Advance Loan": with respect to
each Competitive Advance Loan in any Currency, a notice from
the Lender in respect of such Loan, containing the information
in respect of such Loan and delivered to the Person, in the
manner and by the time specified for a Notice of Competitive
Advance Loan in the Administrative Schedule.
"Notice of Continuation": with respect to a Committed
Rate Loan in any Currency, a notice from the Borrower in
respect of such Loan, containing the information in respect of
such Loan and delivered to the Person, in the manner and
35
<PAGE>
17
by the time specified for a Notice of Continuation in respect
of such Currency in the Administrative Schedule.
"Notice of Conversion": with respect to a Committed Rate
Loan in Dollars which a Borrower wishes to convert from a
Eurocurrency Loan to an ABR Loan, or from an ABR Loan to a
Eurocurrency Loan, as the case may be, a notice from such
Borrower setting forth the amount of such Loan to be
converted, the date of such conversion (which, in the case of
conversions of Eurocurrency Loans to ABR Loans, shall be the
last day of an Interest Period applicable to such Eurocurrency
Loans) and, in the case of conversions of ABR Loans to
Eurocurrency Loans, the length of the initial Interest Period
applicable thereto. Each Notice of Conversion shall be
delivered to the Administrative Agent at its address set forth
in subsection 14.2 and shall be delivered before 11:00 A.M.,
New York City time, one Business Day before the requested
conversion in the case of conversions to ABR Loans, and before
11:00 A.M., New York City time, three Business Days before the
requested conversion in the case of conversions to
Eurocurrency Loans.
"Notice of Swing Line Outstandings": with respect to
each Swing Line Lender, a notice from such Swing Line Lender
containing the information, delivered to the Person, in the
manner and by the time, specified for a Notice of Swing Line
Outstandings in the Administrative Schedule.
"Notice of Swing Line Refunding": with respect to each
Swing Line Lender, a notice from such Swing Line Lender
containing the information, delivered to the Person, in the
manner and by the time, specified for a Notice of Swing Line
Refunding in the Administrative Schedule.
"Obligations": the collective reference to the Company
Obligations and the Subsidiary Obligations.
"Participant": as defined in subsection 14.6(b).
"Payment Office": for each Type of Loan and each
Currency, the Payment Office set forth in respect thereof in
the Administrative Schedule.
"Payment Time": for each Type of Loan and each Currency,
the Payment Time set forth in respect thereof in the
Administrative Schedule.
"PBGC": the Pension Benefit Guaranty Corporation
established pursuant to Subtitle A of Title IV of ERISA.
"Permitted Business Acquisitions": acquisitions of all or
substantially all of the assets of, or all of the shares or
other equity interests in, a Person or division or line of
business of a Person engaged in the same business as the
36
<PAGE> 18
Company and its Subsidiaries or in a related business if
immediately after giving effect thereto: (i) no Default or
Event of Default shall have occurred and be continuing after
giving effect to such acquisition, (ii) all transactions
related thereto shall be consummated in accordance with
applicable laws, (iii) 75% of the outstanding capital stock or
other ownership interests of any acquired or newly formed
corporation or other entity must be owned directly by the
Company or a Restricted Subsidiary and such corporation or
entity shall become a Restricted Subsidiary and a Subsidiary
Guarantor hereunder, (iv) in the case of an acquisition of
Capital Stock, the board of directors (or equivalent governing
body) of the target company shall have approved such
transaction, and (v) the Company shall be in compliance, on a
pro forma basis, with the covenants contained in subsection
10.1 recomputed as at the last day of the most recently ended
fiscal quarter of the Company, and the Company shall have
delivered to the Administrative Agent an officers' certificate
to such effect, together with all relevant financial
information for such acquired corporation, entity or assets.
"Permitted Investor": Sidney Harman, Chairman of the
Board of Directors and Chief Executive Officer of the Company
on the date hereof.
"Person": an individual, partnership, corporation,
business trust, joint stock company, trust, unincorporated
association, joint venture, Governmental Authority or other
entity of whatever nature.
"Plan": at a particular time, any employee benefit plan
which is covered by ERISA and in respect of which the Company
or a Commonly Controlled Entity is (or, if such plan were
terminated at such time, would under Section 4069 of ERISA be
deemed to be) an "employer" as defined in Section 3(5) of
ERISA.
"Properties": as defined in subsection 7.17.
"Quotation Day": in respect of the determination of the
Eurocurrency Rate for any Interest Period for any Currency,
the day on which quotations would ordinarily be given by prime
banks in the London interbank market (or, if such Currency is
Sterling, in the Paris interbank market) for deposits in such
Currency for delivery on the first day of such Interest
Period; provided, that if quotations would ordinarily be given
on more than one date, the Quotation Day for such Interest
Period shall be the last of such dates. On the date hereof,
the Quotation Day in respect of any Interest Period for any
Currency is customarily the last day prior to the beginning of
such Interest Period which is (i) at least two London Banking
Days prior to the beginning of such Interest Period and (ii)
a
day on which banks are open
37
<PAGE> 19
for general banking business in the city which is the
principal financial center of the country of such Currency
(and, in the case of Sterling, in Paris).
"Reference Lenders": Chemical Bank, Societe Generale and
NationsBank.
"Register": as defined in subsection 14.6(d).
"Regulation U": Regulation U of the Board of Governors
of the Federal Reserve System as in effect from time to time.
"Reimbursement Obligation": in respect of each Letter of
Credit, the obligation of the account party thereunder to
reimburse the Issuing Bank for all drawings made thereunder in
accordance with Section 5 and the Application related to such
Letter of Credit.
"Reorganization": with respect to any Multiemployer
Plan, the condition that such plan is in reorganization within
the meaning of Section 4241 of ERISA.
"Reportable Event": any of the events set forth in
Section 4043(b) of ERISA, other than those events as to which
the thirty day notice period is waived under subsections .13,
.14, .16, .18, .19 or .20 of PBGC Reg. 2615.
"Requirement of Law": as to any Person, the Certificate
of Incorporation and By-Laws or other organizational or
governing documents of such Person, and any material law,
treaty, rule or regulation or determination of an arbitrator
or a court or other Governmental Authority, in each case
applicable to or binding upon such Person or any of its
property or to which such Person or any of its property is
subject.
"Responsible Officer": the chief executive officer, the
president, the chief financial officer or the vice president
for financial or legal affairs of the Company.
"Restricted Subsidiary": any Subsidiary listed in
Schedule II. Each Restricted Subsidiary which is organized
under the laws of any jurisdiction in the United States shall
be a Subsidiary Borrower or a Subsidiary Guarantor.
"Sale and Lease-Back Transaction": as defined in
subsection 10.10.
"Schedule Amendment": each Schedule Amendment,
substantially in the form of Exhibit B, executed and delivered
pursuant to subsection 14.1.
38
<PAGE> 20
"Single Employer Plan": any Plan which is covered by
Title IV of ERISA, but which is not a Multiemployer Plan.
"Standby Letter of Credit": as defined in subsection
5.1(b).
"Studer": Studer Professional Audio AG, a Subsidiary
corporation organized under the laws of Switzerland.
"Studer Assets": the investment assets of Studer
acquired with the proceeds of the Studer Preferred Stock as a
part of the Studer Transaction.
"Studer Dividend": any dividend paid to holders of
Studer Preferred Stock.
"Studer Income": the income to be earned by Studer from
the Studer Assets.
"Studer L/C": the letter of credit to be issued for the
account of Studer to back obligations to pay dividends and
redemption price in respect of the Studer Preferred Stock as
a
part of the Studer Transaction.
"Studer Preferred Stock: the preferred stock to be
issued by Studer as a part of the Studer Transaction.
"Studer Transaction": the transaction or series of
transactions described in Schedule V.
"Subordinated Debt": (a) Indebtedness of the Company
under its 11.20% Senior Subordinated Notes Due December 1,
1998, (b) Indebtedness of the Company under its 12% Senior
Subordinated Notes Due August 1, 2002 and (c) any other
unsecured Indebtedness of the Company no part of the principal
of which is required to be paid (whether by way of mandatory
sinking fund, mandatory redemption or mandatory prepayment or
otherwise) prior to the Termination Date, and the payment of
the principal of and interest on which and any other
obligations of the Company in respect thereof is subordinated
to the prior payment in full of the principal of and interest
(including post-petition interest) on the Loans and all other
Obligations hereunder on terms and conditions that are (i) no
less favorable to the Lenders (as reasonably determined by the
Majority Lenders) than those applicable to the Indebtedness
described in clause (b) above or (ii) otherwise personally
acceptable to the Majority Lenders.
"Subsidiary": as to any Person, a corporation,
partnership or other entity of which shares of stock or other
ownership interests having ordinary voting power (other than
stock or such other ownership interests having such power only
by reason of the happening of a contingency)
39
<PAGE>
21
to elect a majority of the board of directors or other
managers of such corporation, partnership or other entity are
at the time owned, or the management of which is otherwise
controlled, directly or indirectly through one or more
intermediaries, or both, by such Person. Unless otherwise
qualified, all references to a "Subsidiary" or to
"Subsidiaries" in this Agreement shall refer to a Subsidiary
or Subsidiaries of the Company.
"Subsidiary Borrower": each Subsidiary of the Company
listed as a Subsidiary Borrower in Schedule II.
"Subsidiary Guarantor": each Subsidiary of the Company
listed as a Subsidiary Guarantor in Schedule II.
"Subsidiary Obligations": the unpaid principal of and
interest on the Loans made to the Subsidiary Borrowers, all
Reimbursement Obligations in respect of Letters of Credit
issued for the account of the Subsidiary Borrowers and all
other obligations and liabilities of the Subsidiary Borrowers
to the Administrative Agent, any Issuing Bank or any Lender
(including, without limitation, interest accruing after the
maturity or earlier acceleration of the Loans and interest
accruing after the filing of any petition in bankruptcy, or
the commencement of any insolvency, reorganization or like
proceeding, relating to any Subsidiary Borrower, whether or
not a claim for post-filing or post petition interest is
allowed in such proceeding), whether direct or indirect,
absolute or contingent, due or to become due, now existing or
hereafter incurred, which may arise under, out of, or in
connection with, this Agreement, the Loans, the Letters of
Credit, or any other document made, delivered or given in
connection therewith, in each case whether on account of
principal, interest, reimbursement obligations, fees,
indemnities, costs, expenses (including, without limitation,
all fees and disbursements of counsel to the Administrative
Agent, any Issuing Bank or any Lender) or otherwise.
"Swing Line Currency": in respect of any Borrower, the
Currency set forth for such Borrower in Schedule III.
"Swing Line Lender": in respect of any Borrower and any
Currency, each Lender listed as a Swing Line Lender in respect
of such Borrower and Currency in Schedule III.
"Swing Line Loan": as defined in subsection 4.1.
"Swing Line Rate": in respect of each Swing Line
Currency, the interest rate per annum set forth for such Swing
Line Currency in Schedule III.
"Termination Date": September 30, 1999.
40
<PAGE> 22
"Tranche": the collective reference to Committed Rate
Eurocurrency Loans in any Currency the then current Interest
Periods with respect to all of which begin on the same date
and end on the same later date (whether or not such Loans
shall originally have been made on the same day).
"Transferee": as defined in subsection 14.6(f).
"Type": in respect of any Loan, its character as a
Committed Rate Loan, Competitive Advance Loan or Swing Line
Loan, as the case may be.
"Uniform Customs": the Uniform Customs and Practice for
Documentary Credits (1993 Revision), International Chamber of
Commerce Publication No. 500, as the same may be amended,
supplemented or otherwise modified from time to time.
"Value": with respect to a Sale and Lease-Back
Transaction, as of any particular time, the amount equal to
the greater of (i) the net proceeds of the sale or transfer of
the property leased pursuant to such Sale and Lease-Back
Transaction or (ii) the fair market value of such property at
the time of entering into such Sale and Lease-Back
Transaction, in either case, divided first by the number of
full years of the term of the lease and then multiplied by the
number of full years of such term remaining at the time of
determination, without regard to any renewal or extension op-
tions contained in the lease.
"Voting Stock": stock of the class or classes pursuant
to which the holders thereof have the general voting power
under ordinary circumstances to elect at least a majority of
the Board of Directors of the Company (irrespective of whether
or not at the time stock of any other class or classes shall
have or might have voting power by reason of the happening of
any contingency).
1.2 Other Definitional Provisions. (a) Unless
otherwise specified therein, all terms defined in this Agreement
shall have the defined meanings when used in any certificate or
other document made or delivered pursuant hereto.
(b) As used herein and in any certificate or other
document made or delivered pursuant hereto, accounting terms
relating to the Company and its Subsidiaries not defined in
subsection 1.1 and accounting terms partly defined in subsection
1.1, to the extent not defined, shall have the respective meanings
given to them under GAAP.
(c) The words "hereof", "herein" and "hereunder" and
words of similar import when used in this Agreement shall refer to
this Agreement as a whole and not to any particular provision of
this Agreement, and Section, subsection, Schedule and Exhibit
41
<PAGE> 23
references are to this Agreement unless otherwise specified.
References to Schedules to this Agreement are references to such
Schedules as the same may from time to time be amended or otherwise
modified in accordance with the terms hereof.
(d) The meanings given to terms defined herein shall be
equally applicable to both the singular and plural forms of such
terms.
SECTION 2. THE COMMITTED RATE LOANS
2.1 Committed Rate Loans. (a) Subject to the terms
and conditions hereof, each Lender severally agrees to make loans
on a revolving credit basis ("Committed Rate Loans") to any
Borrower from time to time during the Commitment Period; provided,
that no Committed Rate Loan shall be made if, after giving effect
to the making of such Loan and the simultaneous application of the
proceeds thereof, the amount of the Exposure would exceed the
aggregate amount of the Commitments. During the Commitment Period
the Borrowers may use the Commitments by borrowing, prepaying the
Committed Rate Loans in whole or in part, and reborrowing, all in
accordance with the terms and conditions hereof.
(b) The Committed Rate Loans may be made in Dollars or
any Available Foreign Currency and may from time to time be (i)
Committed Rate Eurocurrency Loans, (ii) in the case of Committed
Rate Loans in Dollars only, Committed Rate ABR Loans or (iii) a
combination thereof, as determined by the relevant Borrower and set
forth in the Notice of Borrowing or Notice of Conversion with
respect thereto; provided, that no Committed Rate Eurocurrency Loan
shall be made after the day that is one month prior to the
Termination Date.
2.2 Procedure for Committed Rate Loan Borrowing. Any
Borrower may request the Lenders to make Committed Rate Loans on
any Business Day during the Commitment Period by delivering a
Notice of Borrowing. Each borrowing of Committed Rate Loans shall
be in an amount equal to (a) in the case of ABR Loans, $1,000,000
or a whole multiple thereof (or, if the then aggregate undrawn
amount of the Commitments is less than $1,000,000, such lesser
amount) and (b) in the case of Eurocurrency Loans, (i) if in
Dollars, $2,000,000 or increments of $500,000 thereafter, and (ii)
if in any Available Foreign Currency, an amount in such Available
Foreign Currency of which the Dollar Equivalent Amount is at least
$2,000,000. Upon receipt of any such Notice of Borrowing from a
Borrower, the Administrative Agent shall promptly notify each
Lender thereof. Subject to the terms and conditions hereof, each
Lender will make the amount of its pro rata share of each such
borrowing available to the Administrative Agent for the account of
such Borrower at the Funding Office, and at or prior to the Funding
Time, for the Currency of such Loan in funds immediately available
to the Administrative Agent. Such
42
<PAGE>
24
borrowing will then be made available to such Borrower at the
Funding Office, in like funds as received by the Administrative
Agent.
2.3 Repayment of Committed Rate Loans; Evidence of Debt.
(a) Each Borrower hereby unconditionally promises to pay to the
Administrative Agent for the account of each Lender on the
Termination Date (or such earlier date on which the Loans become
due and payable pursuant to Section 12), the then unpaid principal
amount of each Committed Rate Loan made by such Lender. Each
Borrower hereby further agrees to pay interest on the unpaid
principal amount of the Committed Rate Loans made to such Borrower
from time to time outstanding from the date hereof until payment in
full thereof at the rates per annum, and on the dates, set forth in
subsection 2.8.
(b) Each Lender shall maintain in accordance with its
usual practice an account or accounts evidencing indebtedness of
each Borrower to such Lender resulting from each Committed Rate
Loan of such Lender from time to time, including the amounts of
principal and interest payable and paid to such Lender from time to
time under this Agreement.
(c) The Administrative Agent shall maintain the Register
pursuant to subsection 14.6(d), and a subaccount therein for each
Lender, in which shall be recorded (i) the amount of each Committed
Rate Loan made hereunder and each Interest Period applicable
thereto, (ii) the amount of any principal or interest due and
payable or to become due and payable from each Borrower to each
Lender under Committed Rate Loans and (iii) the amount of any sum
received by the Administrative Agent from each Borrower in respect
of Committed Rate Loans, and the amount of each Lender's share
thereof.
(d) The entries made in the Register and the accounts of
each Lender maintained pursuant to subsection 2.3(b) shall, to the
extent permitted by applicable law, be prima facie evidence of the
existence and amounts of the obligations of each Borrower therein
recorded; provided, however, that the failure of any Lender or the
Administrative Agent to maintain the Register or any such account,
or any error therein, shall not in any manner affect the obligation
of each Borrower to repay (with applicable interest) the Committed
Rate Loans made to such Borrower by such Lender in accordance with
the terms of this Agreement.
2.4 Termination or Reduction of Commitments. The
Company shall have the right, upon not less than five Business
Days' notice to the Administrative Agent, to terminate the
Commitments or, from time to time, to reduce the amount of the
Commitments. Any such reduction shall be in an amount equal to
$5,000,000 or a whole multiple thereof and shall reduce permanently
the Commitments then in effect.
43
<PAGE> 25
2.5 Optional Prepayments. Any Borrower may, at any time
and from time to time, prepay the Committed Rate Loans made to such
Borrower, in whole or in part, without premium or penalty, upon at
least four Business Days' irrevocable notice to the Administrative
Agent, specifying the date and amount of prepayment, the Currency
of the Committed Rate Loans to be prepaid and whether the
prepayment is of Eurocurrency Loans, ABR Loans (in the case of
Committed Rate Loans in Dollars) or a combination thereof, and, if
of a combination thereof, the amount allocable to each. Upon
receipt of any such notice the Administrative Agent shall promptly
notify each Lender thereof. If any such notice is given, the
amount specified in such notice shall be due and payable on the
date specified therein, together with any amounts payable pursuant
to subsection 6.7. Partial prepayments shall be in an aggregate
principal amount of $1,000,000 or a whole multiple thereof.
2.6 Conversion and Continuation Options. (a) By giving
a Notice of Conversion, any Borrower may elect from time to time
(i) to convert such Borrower's Eurocurrency Loans in Dollars to ABR
Loans or (ii) to convert such Borrower's ABR Loans to Eurocurrency
Loans in Dollars; provided, that any such conversion of
Eurocurrency Loans may only be made on the last day of an Interest
Period with respect thereto. Upon receipt of any Notice of
Conversion the Administrative Agent shall promptly notify each
Lender thereof. All or any part of Eurocurrency Loans outstanding
in Dollars or ABR Loans may be converted as provided herein,
provided that (i) no ABR Loan may be converted into a Eurocurrency
Loan when any Event of Default has occurred and is continuing and
the Administrative Agent has or the Majority Lenders have
determined that such a conversion is not appropriate and (ii) no
ABR Loan may be converted into a Eurocurrency Loan after the date
that is one month prior to the Termination Date.
(b) By giving a Notice of Continuation, any Borrower may
continue any of such Borrower's Eurocurrency Loans as Eurocurrency
Loans in the same Currency for additional Interest Periods.
(c) Any Borrower may convert Committed Rate Loans
outstanding in one Currency to Committed Rate Loans of a different
Currency by repaying such Loans in the first Currency and borrowing
Loans of such different Currency in accordance with the applicable
provisions of this Agreement.
(d) If any Borrower shall fail to timely give a Notice
of Continuation or a Notice of Conversion in respect of any of such
Borrower's Eurocurrency Loans with respect to which an Interest
Period is expiring, such Eurocurrency Loans shall become due and
payable on the last day of such expiring Interest Period; provided,
that such Borrower may, in accordance with and subject to the terms
and conditions of this Agreement refinance such
44
<PAGE> 26
maturing Eurocurrency Loans on such maturity date with Swing Line
Loans or Competitive Advance Loans.
2.7 Minimum Amounts of Tranches. All borrowings,
conversions and continuations of Committed Rate Loans and all
selections of Interest Periods shall be in such amounts and be made
pursuant to such elections so that, after giving effect thereto,
the aggregate principal amount of the Loans comprising (i) each
Tranche in Dollars shall be not less than $2,000,000 and (ii) each
Tranche in any Available Foreign Currency shall be not less than
the Dollar Equivalent Amount in such Currency of $2,000,000.
2.8 Interest Rates and Payment Dates for Committed Rate
Loans. (a) Each Committed Rate Eurocurrency Loan shall bear
interest for each day during each Interest Period with respect
thereto at a rate per annum equal to the Eurocurrency Rate for such
Interest Period plus the Applicable Margin.
(b) Each Committed Rate ABR Loan shall bear interest at
a rate per annum equal to the ABR.
(c) If all or a portion of (i) the principal amount of
any Committed Rate Loan or (ii) any interest payable thereon shall
not be paid when due (whether at the stated maturity, by
acceleration or otherwise), such overdue amount shall bear interest
at a rate per annum which is (x) in the case of overdue principal,
the rate that would otherwise be applicable thereto pursuant to the
foregoing provisions of this subsection plus 2% or (y) in the case
of overdue interest, the rate described in paragraph (b) of this
subsection plus 2%, in each case from the date of such non-payment
until such amount is paid in full (as well after as before
judgment).
(d) Interest on Committed Rate Loans shall be payable in
arrears on each Interest Payment Date; provided, that interest
accruing pursuant to paragraph (c) of this subsection shall be
payable from time to time on demand.
2.9 Inability to Determine Interest Rate. If on or
prior to the Quotation Day for any Interest Period in respect of
any Eurocurrency Loan in any Currency:
(a) the Administrative Agent shall have determined
(which determination shall be conclusive absent manifest
error) that, by reason of circumstances affecting the relevant
market generally, adequate and reasonable means do not exist
for ascertaining the Eurocurrency Rate for such affected
Currency or such affected Interest Period, or
(b) the Administrative Agent shall have received notice
from Lenders having Commitments comprising at least 25% of the
aggregate amount of the Commitments that the Eurocurrency Rate
determined or to be determined for such
45
<PAGE> 27
affected Interest Period will not adequately and fairly
reflect the cost to such Lenders (as conclusively certified by
such Lenders) of making or maintaining their affected
Committed Rate Loans during such affected Interest Period,
the Administrative Agent shall give telecopy or telephonic notice
thereof to the Company and the Lenders as soon as practicable
thereafter. If such notice is given (x) any Eurocurrency Loans
requested to be made in such affected Currency on the first day of
such affected Interest Period shall be made as ABR Loans in Dollars
in an Equivalent Amount, (y) any Committed Rate Loans that were to
have been converted on the first day of such affected Interest
Period from ABR Loans, to Eurocurrency Loans in such affected
Currency, shall be continued as ABR Loans and (z) any Eurocurrency
Loans in such affected Currency that were to have been continued as
such shall be converted, on the first day of such Interest Period,
to ABR Loans in Dollars in an Equivalent Amount. Until such notice
has been withdrawn by the Administrative Agent, no further
Eurocurrency Loans in such affected Currency shall be made or
continued as such.
SECTION 3. THE COMPETITIVE ADVANCE LOANS
3.1 Competitive Advance Loans. (a) Subject to the
terms and conditions hereof, any Borrower may, from time to time
during the Commitment Period, request one or more Lenders to offer
bids, and any such Lender may, in its sole discretion, offer such
bids, to make competitive advance loans ("Competitive Advance
Loans") to such Borrower on the terms and conditions set forth in
such bids. Each Competitive Advance Loan shall bear interest at
the rates, payable on the dates, and shall mature on the date,
agreed between such Borrower and Lender at the time such
Competitive Advance Loan is made; provided, that (i) each
Competitive Advance Loan shall mature not earlier than 1 day and
not later than 180 days, after the date such Competitive Advance
Loan is made and (ii) no Competitive Advance Loan shall mature
after the Termination Date. During the Commitment Period the
Borrowers may accept bids from Lenders from time to time for
Competitive Advance Loans, and borrow and repay Competitive Advance
Loans, all in accordance with the terms and conditions hereof;
provided, that no Competitive Advance Loan shall be made if, after
giving effect to the making of such Loan and the simultaneous
application of the proceeds thereof, the aggregate amount of the
Exposure would exceed the aggregate amount of the Commitments.
Subject to the foregoing, any Lender may, in its sole discretion,
make Competitive Advance Loans in an aggregate outstanding amount
exceeding the amount of such Lender's Commitment.
(b) The Competitive Advance Loans may be made in Dollars
or any Available Foreign Currency, as agreed between the Borrower
and Lender in respect thereof at the time such Competitive Advance
Loan is made.
46
<PAGE> 28
3.2 Procedure for Competitive Advance Loan Borrowing.
(a) Any Borrower may request one or more Lenders to make bids to
make Committed Rate Loans in such manner and at such time as shall
be agreed by such Borrower and such Lenders. The proceeds of each
Competitive Advance Loan will be made available to the Borrower in
respect thereof in the manner agreed between such Borrower and the
relevant Lender at the time such Competitive Advance Loan is made.
(b) Promptly after any Lender makes a Competitive
Advance Loan (and in any event on the same day) such Lender shall
deliver a Notice of Competitive Advance Loan.
3.3 Repayment of Competitive Advance Loans; Evidence of
Debt. (a) Each Borrower that borrows any Competitive Advance Loan
hereby unconditionally promises to pay to the Lender that made such
Competitive Advance Loan on the maturity date, as agreed by such
Borrower and Lender at the time such Competitive Advance Loan is
made (or such earlier date on which all the Loans become due and
payable pursuant to Section 12), the then unpaid principal amount
of such Competitive Advance Loan. Each Borrower hereby further
agrees to pay interest on the unpaid principal amount of the
Competitive Advance Loans made by any Lender to such Borrower from
time to time outstanding from the date thereof until payment in
full thereof at the rate per annum, and on the dates, agreed by
such Borrower and Lender at the time such Competitive Advance Loan
is made. All payments in respect of Competitive Advance Loans
shall be made by such Borrower to its Competitive Advance Loan
Lender at the address separately agreed to between the Company and
such Competitive Advance Loan Lender.
(b) Each Lender shall maintain in accordance with its
usual practice an account or accounts evidencing indebtedness of
each Borrower to such Lender resulting from each Competitive
Advance Loan of such Lender from time to time, including the
amounts of principal and interest payable and paid to such Lender
from time to time in respect of Competitive Advance Loans. The
entries made in the accounts of each Lender maintained pursuant to
this subsection 3.3(b) shall, to the extent permitted by applicable
law, be prima facie evidence of the existence and amounts of the
obligations of each Borrower therein recorded, absent manifest
error; provided, however, that the failure of any Lender to
maintain any such account, or any error therein, shall not in any
manner affect the obligation of each Borrower to repay (with
applicable interest) the Competitive Advance Loans made to such
Borrower by such Lender in accordance with the terms of this
Agreement.
3.4 Prepayments. Unless otherwise agreed by the Lender
making a Competitive Advance Loan, such Competitive Advance Loan
may not be optionally prepaid prior to the scheduled maturity date
thereof.
47
<PAGE> 29
SECTION 4. THE SWING LINE LOANS
4.1 Swing Line Loans. Subject to the terms and
conditions hereof, each Borrower may borrow from such Borrower's
Swing Line Lender swing line loans ("Swing Line Loans") from time
to time during the Commitment Period in Dollars or in the Swing
Line Currency of such Borrower; provided, that no Swing Line Loan
shall be made if, after giving effect to the making of such Loan
and the simultaneous application of the proceeds thereof, (i) the
amount of the Exposure would exceed the aggregate amount of the
Commitments or (ii) (A) the aggregate principal amount of the Swing
Line Loans of any such Borrower outstanding in Dollars would exceed
$2,000,000 or (B) the Dollar Equivalent Amount of aggregate
principal amount of the Swing Line Loans of such Borrower
outstanding in the Swing Line Currency of any such Borrower would
exceed $2,000,000. During the Commitment Period, the Borrowers may
borrow and prepay the Swing Line Loans, in whole or in part, all in
accordance with the terms and conditions hereof.
4.2 Procedure for Swing Line Borrowing. (a) Any
Borrower may borrow Swing Line Loans during the Commitment Period
on any Business Day by giving a Notice of Borrowing in respect of
such Swing Line Loan. Subject to the terms and conditions hereof,
on the Borrowing Date of each Swing Line Loan, the relevant Swing
Line Lender shall make the proceeds thereof available to the
relevant Borrower in immediately available funds in the manner from
time to time agreed by such Borrower and such Swing Line Lender.
(b) On the last Business Day of each week on which a
Swing Line Lender has any outstanding Swing Line Loans, such Lender
shall deliver a Notice to the Administrative Agent of Swing Line
Outstandings. The Administrative Agent will, at the request of any
Swing Line Lender, advise such Swing Line Lender of the Exchange
Rate used by the Administrative Agent in calculating the Dollar
Equivalent Amount of Swing Line Loans of such Swing Line Lender on
any date.
4.3 Repayment of Swing Line Loans; Evidence of Debt.
(a) Each Borrower of Swing Line Loans hereby unconditionally
promises to pay to its Swing Line Lender on the Termination Date
(or such earlier date on which such Swing Line Loans become due and
payable pursuant to subsection 4.4 or on which all the Loans become
due and payable pursuant to Section 12), the then unpaid principal
amount of such Swing Line Loans. Each Borrower of Swing Line Loans
hereby further agrees to pay interest on the unpaid principal
amount of such Swing Line Loans from time to time outstanding from
the date thereof until payment in full thereof at the Swing Line
Rate for the Currency of such Swing Line Loan, payable on the last
Business Day of each calendar month on which such Swing Line Loans
are outstanding. All payments in respect of Swing Line Loans shall
be made by such Borrower of Swing Line Loans to its Swing Line
Lender at the
48
<PAGE> 30
address set forth in Schedule III for such Swing Line Lender and
Swing Line Loans in such Currency.
(b) Each Swing Line Lender shall maintain in accordance
with its usual practice an account or accounts evidencing
indebtedness of each Borrower to such Swing Line Lender resulting
from each Swing Line Loan of such Lender from time to time,
including the amounts of principal and interest payable and paid to
such Swing Line Lender from time to time under this Agreement. The
entries made in the accounts of each Swing Line Lender maintained
pursuant to this subsection 4.3(b) shall, to the extent permitted
by applicable law, be prima facie evidence of the existence and
amounts of the obligations of each Borrower therein recorded;
provided, however, that the failure of any Swing Line Lender to
maintain any such account, or any error therein, shall not in any
manner affect the obligation of each Borrower to repay (with
applicable interest) the Swing Line Loans made to such Borrower by
such Swing Line Lender in accordance with the terms of this
Agreement.
4.4 Allocating Swing Line Loans; Swing Line Loan
Participations. (a) If any Event of Default shall occur and be
continuing, any Swing Line Lender may, in its sole and absolute
discretion, direct that the Swing Line Loans owing to it be
refunded, by delivering a Notice of Swing Line Refunding. Upon
receipt of a Notice of Swing Line Refunding the Administrative
Agent shall promptly give notice of the contents thereof to the
Lenders and, unless an Event of Default described in Section 12 (f)
in respect of the Company or the relevant Borrower has occurred, to
the Company and the relevant Borrower. Each such Notice of Swing
Line Refunding shall be deemed to constitute delivery by such
Borrower of a Notice of Borrowing of Committed Rate Eurocurrency
Loans in the amount and Currency of the Swing Line Loans to which
it relates, for an Interest Period of one month's duration.
Subject to the terms and conditions hereof, each Lender (including
each Swing Line Lender in its capacity as a Lender having a
Commitment) hereby agrees to make a Committed Rate Loan to such
Borrower pursuant to Section 2 in an amount equal to such Lender's
Commitment Percentage of the aggregate amount of the Swing Line
Loans to which such Notice of Swing Line Refunding relates. Unless
any of the events described in Section 12(f) in respect of the
Company or such Borrower shall have occurred (in which case the
procedures of subsection 4.4(b) shall apply), each Lender shall
make the amount of such Committed Rate Loan available to the
Administrative Agent at the Funding Office, and at or prior to the
Funding Time, for the Currency of such Loan in funds immediately
available to the Administrative Agent. The proceeds of such
Committed Rate Loans shall be immediately made available to such
Swing Line Lender by the Administrative Agent and applied by such
Swing Line Lender to repay the Swing Line Loans to which such
Notice of Swing Line Refunding related.
(b) If prior to the time a Committed Rate Loan would
have otherwise been made pursuant to subsection 4.4(a), one of
49
<PAGE> 31
the events described in Section 12(f) shall have occurred in
respect of the Company or the relevant Borrower, each Lender (other
than the relevant Swing Line Lender) shall, on the date such
Committed Rate Loan would have been made pursuant to the Notice of
Swing Line Refunding referred to in subsection 4.4(a) (the
"Refunding Date"), purchase an undivided participating interest in
the outstanding Swing Line Loans to which such Notice of Swing Line
Refunding related, in an amount equal to (i) such Lender's
Commitment Percentage times (ii) the aggregate principal amount of
such Swing Line Loans then outstanding which were to have been
repaid with Committed Rate Loans (the "Swing Line Participation
Amount"). On the Refunding Date, each Lender shall transfer to
such Swing Line Lender, in immediately available funds, such
Lender's Swing Line Participation Amount, and upon receipt thereof
such Swing Line Lender shall, if requested by any Lender, deliver
to such Lender a participation certificate dated the date of such
Swing Line Lender's receipt of such funds and evidencing such
Lender's ownership of its Swing Line Participation Amount.
(c) Whenever, at any time after any Swing Line Lender
has received from any Lender such Lender's Swing Line Participation
Amount, such Swing Line Lender receives any payment on account of
the related Swing Line Loans, such Swing Line Lender will
distribute to such Lender its Commitment Percentage of such payment
on account of its Swing Line Participation Amount (appropriately
adjusted, in the case of interest payments, to reflect the period
of time during which such Lender's participating interest was
outstanding and funded); provided, however, that in the event that
such payment received by such Swing Line Lender is required to be
returned, such Lender will return to such Swing Line Lender any
portion thereof previously distributed to it by such Swing Line
Lender.
(d) Each Lender's obligation to make Committed Rate
Loans pursuant to subsection 4.4(a) and to purchase participating
interests pursuant to subsection 4.4(b) shall be absolute and
unconditional and shall not be affected by any circumstance,
including, without limitation, (i) any set-off, counterclaim,
recoupment, defense or other right which such Lender may have
against any other Lender or any Borrower, or any Borrower may have
against any Lender or any other Person, as the case may be, for any
reason whatsoever; (ii) the occurrence or continuance of a Default
or an Event of Default; (iii) any adverse change in the condition
(financial or otherwise) of the Company or any of its Subsidiaries;
(iv) any breach of this Agreement by any party hereto; or (v) any
other circumstance, happening or event whatsoever, whether or not
similar to any of the foregoing.
50
<PAGE> 32
SECTION 5. THE LETTERS OF CREDIT
5.1 L/C Commitment. (a) Subject to the terms and
conditions hereof, each Issuing Bank agrees to issue letters of
credit ("Letters of Credit") for the account of any Borrower on any
Business Day during the Commitment Period in such form as shall be
reasonably acceptable to such Issuing Bank; provided, that no
Letter of Credit shall be issued if, after giving effect thereto
(i) the aggregate amount of the Exposure would exceed the aggregate
amount of the Commitments or (ii) the aggregate amount of the L/C
Obligations would exceed $50,000,000.
(b) Each Letter of Credit shall:
(i) be denominated in Dollars or an Available Foreign
Currency and shall be either (A) a standby letter of credit
issued to support obligations of a Borrower, contingent or
otherwise, to provide credit support for workers'
compensation, other insurance programs and other lawful
corporate purposes (a "Standby Letter of Credit") or (B) a
commercial letter of credit issued in respect of the purchase
of goods and services in the ordinary course of business of
the Company and its Subsidiaries (a "Commercial Letter of
Credit"; together with the Standby Letters of Credit, the
"Letters of Credit") and,
(ii) expire no later than the earlier of (A) 360 days
(in the case of Standby Letters of Credit) or 180 days (in the
case of Commercial Letters of Credit) after its date of
issuance and (B) 5 Business Days prior to the Termination
Date.
(c) Each Letter of Credit shall be subject to the
Uniform Customs and, to the extent not inconsistent therewith, the
laws of the State of New York or, if acceptable to the Majority
Lenders and the relevant account party, the jurisdiction of the
Issuing Office at which such Letter of Credit is issued.
(d) No Issuing Bank shall at any time be obligated to
issue any Letter of Credit hereunder if such issuance would
conflict with, or cause such Issuing Bank or any Lender to exceed
any limits imposed by, any applicable Requirement of Law.
5.2 Procedure for Issuance of Letters of Credit under
this Agreement. Any Borrower may from time to time request that an
Issuing Bank issue a Letter of Credit by delivering to such Issuing
Bank at its Issuing Office an Application therefor, completed to
the satisfaction of the Issuing Bank, and such other certificates,
documents and other papers and information as such Issuing Bank may
reasonably request. Upon receipt by an Issuing Bank of any
Application, such Issuing Bank will process such Application and
the certificates, documents and other papers and information
delivered to it in connection therewith in accordance with its
customary procedures and shall promptly issue the Letter
51
<PAGE> 33
of Credit requested thereby (but in no event shall any Issuing Bank
be required to issue any Letter of Credit earlier than five
Business Days after its receipt of the Application therefor and all
such other certificates, documents and other papers and information
relating thereto) by issuing the original of such Letter of Credit
to the beneficiary thereof or as otherwise may be agreed by such
Issuing Bank and such Borrower. Such Issuing Bank shall advise the
Administrative Agent of the terms of such Letter of Credit on the
date of issuance thereof and shall promptly thereafter furnish
copies thereof to the Company and each Lender.
5.3 Fees, Commissions and Other Charges. (a) Each
Borrower for whose account a Letter of Credit is issued hereunder
shall pay to the Administrative Agent, for the account of the
Lenders (including the Issuing Bank) pro rata according to their
Commitment Percentages, a letter of credit commission with respect
to each Letter of Credit, computed at a rate equal to the then
Applicable Margin for Eurocurrency Loans on the daily average
undrawn face amount of such Letter of Credit. Such commissions
shall be payable in arrears on the last Business Day of each March,
June, September and December to occur after the date of issuance of
each Letter of Credit and on the expiration date of such Letter of
Credit and shall be nonrefundable. Each Borrower for whose account
a Letter of Credit is issued hereunder shall also pay to the
Issuing Bank in respect of each Letter of Credit such commission as
shall be agreed from time to time by the Company and such Issuing
Bank.
(b) In addition to the foregoing fees and commissions,
each Borrower for whose account a Letter of Credit is issued
hereunder shall pay or reimburse the Issuing Bank for such normal
and customary costs and expenses as are incurred or charged by such
Issuing Bank in issuing, effecting payment under, amending or
otherwise administering such Letter of Credit.
(c) The Administrative Agent shall, promptly following
its receipt thereof, distribute to the Issuing Bank and the Lenders
all fees and commissions received by the Administrative Agent for
their respective accounts pursuant to this subsection.
5.4 L/C Participations. (a) Each Issuing Bank
irrevocably agrees to grant and hereby grants to each L/C
Participant, and, to induce the Issuing Bank to issue Letters of
Credit hereunder, each L/C Participant irrevocably agrees to accept
and purchase and hereby accepts and purchases from such Issuing
Bank, on the terms and conditions hereinafter stated, for such L/C
Participant's own account and risk, an undivided interest equal to
such L/C Participant's Commitment Percentage in such Issuing Bank's
obligations and rights under each Letter of Credit issued by such
Issuing Bank hereunder and the amount of each draft paid by such
Issuing Bank thereunder. Each L/C Participant unconditionally and
irrevocably agrees with each Issuing Bank that, if a draft is paid
under any Letter of Credit
52
<PAGE> 34
issued by such Issuing Bank for which such Issuing Bank is not
reimbursed in full by the Borrower which is the account party
thereunder in accordance with the terms of this Agreement, such L/C
Participant shall pay to such Issuing Bank upon demand at such
Issuing Bank's Issuing Office an amount equal to such L/C
Participant's Commitment Percentage of the amount of such draft, or
any part thereof, which is not so reimbursed.
(b) If any amount required to be paid by any L/C
Participant to any Issuing Bank pursuant to subsection 5.4(a) in
respect of any unreimbursed portion of any payment made by such
Issuing Bank under any Letter of Credit is not paid to such Issuing
Bank on the date such payment is due from such L/C Participant,
such L/C Participant shall pay to such Issuing Bank on demand an
amount equal to the product of such amount, times (A) in the case
of any such payment obligation denominated in Dollars, the daily
average Federal funds rate, as quoted by such Issuing Bank, or (B)
in the case of any such payment obligation denominated in an
Available Foreign Currency, the rate customary in such Currency for
settlement of similar inter-bank obligations, as quoted by such
Issuing Bank, in each case during the period from and including the
date such payment is required to the date on which such payment is
immediately available to the Issuing Bank, times a fraction the
numerator of which is the number of days that elapse during such
period and the denominator of which is 360. A certificate of an
Issuing Bank submitted to any L/C Participant with respect to any
amounts owing under this subsection shall be conclusive in the
absence of manifest error.
(c) Whenever, at any time after an Issuing Bank has made
payment under any Letter of Credit and has received from any L/C
Participant its pro rata share of such payment in accordance with
subsection 5.4(a) the Issuing Bank receives any payment related to
such Letter of Credit (whether directly from the account party or
otherwise, including by way of set-off or proceeds of collateral
applied thereto by such Issuing Bank), or any payment of interest
on account thereof, such Issuing Bank will distribute to such L/C
Participant its pro rata share thereof; provided, however, that in
the event that any such payment received by such Issuing Bank shall
be required to be returned by the Issuing Bank, such L/C
Participant shall return to such Issuing Bank the portion thereof
previously distributed by such Issuing Bank to it.
5.5 Reimbursement Obligation of the Borrowers.
(a) Each Borrower for whose account a Letter of Credit is
issued hereunder agrees to reimburse the Issuing Bank in respect of
such Letter of Credit on each date on which such Issuing Bank
notifies such Borrower of the date and amount of a draft presented
under such Letter of Credit and paid by such Issuing Bank for the
amount of such draft so paid and any taxes, fees, charges or
other costs or expenses incurred by such Issuing Bank in connection
with such payment. Each such payment shall be made
53
<PAGE> 35
to such Issuing Bank at its Issuing Office in the Currency in which
payment of such draft was made and in immediately available funds.
(b) Interest shall be payable on any and all amounts
remaining unpaid by any Borrower under this subsection from the
date such amounts become payable (whether at stated maturity, by
acceleration or otherwise) until payment in full at the rate which
is (i) in the case of such amounts payable in Dollars, 2% above the
ABR from time to time and (ii) in the case of such amounts payable
in any other currency, 2% above the rate reasonably determined by
the Issuing Bank as the cost of funding such overdue amount from
time to time on an overnight basis.
5.6 Obligations Absolute. (a) The obligations of the
Borrowers under this Section 5 shall be absolute and unconditional
under any and all circumstances and irrespective of any set-off,
counterclaim or defense to payment which any Borrower may have or
have had against the Issuing Bank or any beneficiary of a Letter of
Credit.
(b) Each Borrower for whose account a Letter of Credit
is issued hereunder also agrees with the Issuing Bank in respect of
such Letter of Credit that such Issuing Bank shall not be
responsible for, and such Borrower's Reimbursement Obligations
under subsection 5.5(a) shall not be affected by, among other
things, (i) the validity or genuineness of documents or of any
endorsements thereon, even though such documents shall in fact
prove to be invalid, fraudulent or forged, provided, that reliance
upon such documents by such Issuing Bank shall not have constituted
gross negligence or wilful misconduct of such Issuing Bank or (ii)
any dispute between or among such Borrower and any beneficiary of
any Letter of Credit or any other party to which such Letter of
Credit may be transferred or (iii) any claims whatsoever of any
Borrower against any beneficiary of such Letter of Credit or any
such transferee.
(c) The Issuing Banks shall not be liable for any error,
omission, interruption or delay in transmission, dispatch or
delivery of any message or advice, however transmitted, in
connection with any Letter of Credit, except for errors or
omissions caused by such Issuing Bank's gross negligence or willful
misconduct.
(d) Each Borrower for whose account a Letter of Credit
is issued hereunder agrees that any action taken or omitted by any
Issuing Bank under or in connection with any Letter of Credit or
the related drafts or documents, if done in the absence of gross
negligence or willful misconduct and in accordance with the
standards of care specified in the Uniform Customs, shall be
binding on such Borrower and shall not result in any liability of
such Issuing Bank to such Borrower.
54
<PAGE> 36
5.7 Letter of Credit Payments. If any draft shall be
presented for payment to an Issuing Bank under any Letter of
Credit, such Issuing Bank shall promptly notify the account party
of the date and amount thereof. The responsibility of the Issuing
Bank to the account party in connection with any draft presented
for payment under any Letter of Credit shall, in addition to any
payment obligation expressly provided for in such Letter of Credit,
be limited to determining that the documents (including each draft)
delivered under such Letter of Credit in connection with such
presentment are in conformity with such Letter of Credit.
5.8 Application. To the extent that any provision of
any Application related to any Letter of Credit is inconsistent
with the provisions of this Section 5, the provisions of this
Section 5 shall apply.
SECTION 6. CERTAIN PROVISIONS APPLICABLE TO THE LOANS AND
LETTERS OF CREDIT
6.1 Facility Fee. (a) The Company agrees to pay to the
Administrative Agent for the account of each Lender a facility fee
for the period from and including the Closing Date to, but
excluding, the Termination Date, computed at the Facility Fee Rate
in effect from time to time on the average daily amount of the
Commitment (used and unused) of such Lender during the period for
which payment is made, payable quarterly in arrears on the last day
of each March, June, September and December and on the Termination
Date or such earlier date on which the Commitments shall terminate
as provided herein, commencing on the first of such dates to occur
after the date hereof.
(b) The Company agrees to pay to the Administrative
Agent, for its own account, the administrative agent's fee, to the
Administrative Agent, for the account of the Lenders, the upfront
fee, and to Chemical, for its own account, such other fees, in the
amounts and on the dates set forth in the Fee Letter.
6.2 Computation of Interest and Fees. Facility fees
and, whenever it is calculated on the basis of the Prime Rate,
interest shall be calculated on the basis of a 365- (or 366-, as
the case may be) day year for the actual days elapsed; and,
otherwise, interest and Letter of Credit commissions shall be
calculated on the basis of a 360-day year for the actual days
elapsed. The Administrative Agent shall as soon as practicable
notify the relevant Borrower and the Lenders of each determination
of a Eurocurrency Rate. Any change in the ABR due to a change in
the Prime Rate, the Three-Month Secondary CD Rate or the Federal
Funds Effective Rate shall be effective as of the opening of
business on the effective day of such change in the Prime Rate, the
Three-Month Secondary CD Rate or the Federal Funds Effective Rate,
respectively. The Administrative Agent
55
<PAGE> 37
shall as soon as practicable notify the relevant Borrower and the
Lenders of the effective date and the amount of each such change in
interest rate.
(b) Each determination of an interest rate by the
Administrative Agent pursuant to any provision of this Agreement
shall be conclusive and binding on the Borrowers and the Lenders in
the absence of manifest error.
6.3 Pro Rata Treatment and Payments. (a) Each
borrowing by a Borrower of Committed Rate Loans, each payment by
the Borrower on account of any facility fee hereunder and any
reduction of the Commitments of the Lenders shall be made pro rata
according to the respective Commitment Percentages of the Lenders.
Each payment (including each prepayment) by any Borrower on account
of principal of and interest on any Loans shall be made pro rata
according to the respective principal amounts of the Loans of such
Borrower then due and owing to the Lenders. All payments
(including prepayments) to be made by any Borrower hereunder,
whether on account of principal, interest, fees, Reimbursement
Obligations or otherwise, shall be made without set off or
counterclaim. All payments in respect of Committed Rate Loans in
any Currency shall be made in such Currency and in immediately
available funds at the Payment Office, and at or prior to the
Payment Time, for such Type of Loans and such Currency, on the due
date thereof. The Administrative Agent shall distribute to the
Lenders any payments received by the Administrative Agent promptly
upon receipt in like funds as received. If any payment hereunder
becomes due and payable on a day other than a Business Day, such
payment shall be extended to the next succeeding Business Day, and,
with respect to payments of principal, interest thereon shall be
payable at the then applicable rate during such extension.
(b) Unless the Administrative Agent shall have been
notified in writing by any Lender prior to a Borrowing Date in
respect of Committed Rate Loans that such Lender will not make the
amount that would constitute its Commitment Percentage of such
borrowing available to the Administrative Agent, the Administrative
Agent may assume that such Lender is making such amount available
to the Administrative Agent, and the Administrative Agent may, in
reliance upon such assumption, make available to the relevant
Borrower a corresponding amount. If such amount is not made
available to the Administrative Agent by the required time on the
Borrowing Date therefor, such Lender shall pay to the
Administrative Agent, on demand, such amount with interest thereon
at a rate equal to (A) in the case of any such Committed Rate Loans
denominated in Dollars, the daily average Federal funds rate, as
quoted by the Administrative Agent, or (B) in the case of any
Committed Rate Loans denominated in an Available Foreign Currency,
the rate customary in such Currency for settlement of similar
inter-bank obligations, as quoted by the Administrative Agent, in
each case for the period until such Lender makes such amount
immediately available to the
56
<PAGE> 38
Administrative Agent. A certificate of the Administrative Agent
submitted to any Lender with respect to any amounts owing under
this subsection shall be conclusive in the absence of manifest
error. If such Lender's Commitment Percentage of such borrowing is
not made available to the Administrative Agent by such Lender
within three Business Days of such Borrowing Date, the
Administrative Agent shall also be entitled to recover such amount
with interest thereon at the rate per annum applicable to Swing
Line Loans in such Currency hereunder, on demand, from the relevant
Borrower.
6.4 Illegality. Notwithstanding any other provision
herein, if the adoption of or any change in any Requirement of Law
or in the interpretation thereof by any Governmental Authority
charged with the administration or interpretation thereof shall
make it unlawful for any Lender to make or maintain Eurocurrency
Loans or Extensions of Credit to one or more Foreign Subsidiary
Borrowers as contemplated by this Agreement, the commitment of such
Lender hereunder to make Eurocurrency Loans, continue Eurocurrency
Loans as such, convert Loans to Eurocurrency Loans and maintain
Extensions of Credit to such Foreign Subsidiary Borrowers shall
forthwith be cancelled to the extent necessary to remedy or prevent
such illegality. Nothing in this subsection 6.4 shall affect the
obligation of the Lenders to make and maintain ABR Loans to the
Company and the Domestic Subsidiary Borrowers and, to the extent
not unlawful, to Foreign Subsidiary Borrowers, notwithstanding that
a Requirement of Law may make it unlawful to make and maintain
Eurocurrency Loans to such Borrowers.
6.5 Requirements of Law. (a) If after the date
hereof the adoption of or any change in any Requirement of Law or
in the interpretation thereof by any Governmental Authority charged
with the administration or interpretation thereof or compliance by
any Lender with any request or directive (whether or not having the
force of law) applicable generally in the jurisdiction of such
Lender to banking institutions of the same type as such Lender:
(i) shall subject any Lender to any tax of any kind
whatsoever with respect to this Agreement, any Eurocurrency
Loan made by it to any Borrower or any Extension of Credit to
any Foreign Subsidiary Borrower, or change the basis of
taxation of payments to such Lender in respect thereof (except
for Non-Excluded Taxes covered by subsection 6.6 and changes
in the rate of tax on the overall net income of such Lender);
(ii) shall impose, modify or hold applicable any
reserve, special deposit, compulsory loan or similar
requirement against assets held by, deposits or other
liabilities in or for the account of, advances, loans or other
extensions of credit by, or any other acquisition of
57
<PAGE> 39
funds by, any office of such Lender which is not otherwise
included in the determination of the Eurocurrency Rate; or
(iii) shall impose on such Lender any other
condition affecting Eurocurrency Loans made by such Lender to
any Borrower, or Extensions of Credit by such Lender to
Foreign Subsidiary Borrowers
and the result of any of the foregoing is to increase the cost to
such Lender, by an amount which such Lender deems to be material,
of making, converting into, continuing or maintaining Eurocurrency
Loans or making or maintaining Extensions of Credit to Foreign
Subsidiary Borrowers or to reduce any amount receivable hereunder
in respect thereof, and such Lender has no reasonable means (as it
shall determine in its sole discretion) to avoid such costs or
reductions, then, in any such case, the Company shall promptly pay
such Lende |
