Credit Agreement - ICN Pharmaceuticals Inc. and Banque Nationale de Paris
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ICN PHARMACEUTICALS, INC.
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CREDIT AGREEMENT
Dated as of March 31, l997
$15,000,000
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BANQUE NATIONALE DE PARIS
Los Angeles Branch
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TABLE OF CONTENTS
PAGE
SECTION 1
DEFINITIONS.................................................. 1
1.1 CERTAIN DEFINED TERMS............................................. 1
1.2 ACCOUNTING TERMS.................................................. 8
1.3 OTHER TERMS....................................................... 8
SECTION 2
CREDIT....................................................... 9
2.1 REVOLVING CREDIT LOANS AND LETTERS OF CREDIT...................... 9
2.2 ISSUANCE OF LETTERS OF CREDIT..................................... 12
SECTION 3
CONDITIONS OF LENDING........................................ 14
3.1 CONDITIONS PRECEDENT TO THE INITIAL REVOLVING CREDIT
LOAN OR LETTER OF CREDIT..................................... 14
3.2 CONDITIONS PRECEDENT TO EACH REVOLVING CREDIT LOAN OR
LETTER OF CREDIT............................................. 15
SECTION 4
REPRESENTATIONS AND WARRANTIES............................... 16
4.1 STATUS............................................................ 16
4.2 AUTHORITY......................................................... 16
4.3 LEGAL EFFECT...................................................... 17
4.4 FINANCIAL STATEMENTS.............................................. 17
4.5 LITIGATION........................................................ 17
4.6 TITLE TO ASSETS................................................... 18
4.7 ERISA............................................................. 18
4.8 TAXES............................................................. 18
4.9 REGULATION U...................................................... 18
4.10 ENVIRONMENTAL COMPLIANCE.......................................... 18
SECTION 5
COVENANTS.................................................... 18
5.1 PRESERVATION OF EXISTENCE; WITH APPLICABLE LAWS................... 19
5.2 MAINTENANCE OF INSURANCE.......................................... 19
5.3 MAINTENANCE OF PROPERTIES......................................... 19
5.4 PAYMENT OF OBLIGATIONS AND TAXES.................................. 19
5.5 INSPECTION RIGHTS................................................. 19
5.6 REPORTING AND CERTIFICATION REQUIREMENTS.......................... 20
5.7 PAYMENT OF DIVIDENDS.............................................. 20
5.8 REDEMPTION OR REPURCHASE OF STOCK................................. 21
5.9 ADDITIONAL INDEBTEDNESS........................................... 21
5.10 LOANS............................................................. 21
5.11 LIENS AND ENCUMBRANCES............................................ 21
5.12 TRANSFER ASSETS................................................... 21
5.13 CHANGE IN NATURE OF BUSINESS...................................... 21
5.14 FINANCIAL CONDITION............................................... 22
5.15 NOTICE............................................................ 22
5.16 CONSOLIDATED OPERATING LOSS....................................... 22
5.17 ENVIRONMENTAL COMPLIANCE.......................................... 22
5.18 SUBORDINATED DEBT................................................. 23
5.19 INVESTMENTS....................................................... 23
SECTION 6
EVENTS OF DEFAULT.............................................. 23
6.1 NON-PAYMENT....................................................... 23
6.2 PERFORMANCE UNDER THIS AND OTHER AGREEMENTS....................... 23
6.3 REPRESENTATIONS AND WARRANTIES; FINANCIAL STATEMENTS.............. 24
6.4 INSOLVENCY........................................................ 24
6.5 EXECUTION......................................................... 24
6.6 SUSPENSION........................................................ 24
6.7 CHANGE IN OWNERSHIP............................................... 25
SECTION 7
REMEDIES ON DEFAULT............................................ 25
7.1 ACCELERATION...................................................... 25
7.2 CEASE EXTENDING CREDIT............................................ 25
7.3 TERMINATION....................................................... 25
7.4 CASH COLLATERAL................................................... 25
7.5 NON-EXCLUSIVITY OF REMEDIES....................................... 25
SECTION 8
BANK PROTECTIONS............................................... 26
8.1 INABILITY TO DETERMINE INTEREST RATE.............................. 26
8.2 ILLEGALITY........................................................ 26
8.3 INCREASED COSTS................................................... 27
8.4 TAXES............................................................. 28
8.5 INDEMNITY......................................................... 29
8.6 MITIGATION OF COSTS............................................... 29
SECTION 9
MISCELLANEOUS.................................................. 30
9.1 DEFAULT INTEREST RATE............................................. 30
9.2 RELIANCE.......................................................... 30
9.3 EXPENSES.......................................................... 30
9.4 NOTICES........................................................... 30
9.5 WAIVER............................................................ 31
9.6 CONFLICTING PROVISIONS............................................ 31
9.7 BINDING EFFECT; ASSIGNMENT........................................ 31
9.8 JURISDICTION...................................................... 31
9.9 WAIVER OF JURY TRIAL.............................................. 31
9.10 HEADINGS.......................................................... 32
9.11 ENTIRE AGREEMENT.................................................. 32
9.12 CONFIDENTIALITY................................................... 32
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CREDIT AGREEMENT
This Credit Agreement (the "Agreement") is made and entered into as of
March 31, 1997, by and between BANQUE NATIONALE DE PARIS, Los Angeles Branch
(the "Bank") and ICN PHARMACEUTICALS, INC. (the "Borrower"), on the terms and
conditions that follow:
SECTION 1
DEFINITIONS
1.1 CERTAIN DEFINED TERMS: Unless elsewhere defined in this Agreement,
the following terms shall have the following meanings (such meanings to be
generally applicable to the singular and plural forms of the terms defined):
"AGREEMENT": shall have the meaning set forth in the first paragraph
hereof.
"ALTERNATE BASE RATE": for any day, a rate per annum (rounded upwards,
if necessary, to the next 1/16 of 1%) equal to the greater of (a) the Reference
Rate and (b) the Federal Funds Effective Rate in effect on such day PLUS 1/2 of
1%. Any change in the Alternate Base Rate due to a change in the Reference Rate
or the Federal Funds Effective Rate shall be effective on the effective date of
such change in the Reference Rate or the Federal Funds Effective Rate,
respectively.
"ALTERNATE BASE RATE LOANS": Revolving Credit Loans the rate of
interest applicable to which is based upon the Alternate Base Rate.
"BANK": shall have the meaning set forth in the first paragraph
hereof.
"BORROWER": shall have the meaning set forth in the first paragraph
hereof.
"BUSINESS DAY": shall mean a day other than a Saturday or Sunday on
which commercial banks are open for business in California, USA.
"CASH INCOME TAXES": for any period, income taxes paid in cash by the
Borrower and its Subsidiaries on a consolidated basis.
"COMMITMENT": $15,000,000, as the same shall be adjusted from time to
time pursuant to this Agreement.
"CURRENT ASSETS": at any date, the assets of the Borrower and its
Subsidiaries on a consolidated basis which would be classified as current assets
in accordance with generally accepted accounting principles.
"CURRENT LIABILITIES": at any date, the liabilities (including tax and
other proper accruals) of the Borrower and its Subsidiaries on a consolidated
basis which would be classified as current liabilities in accordance with
generally accepted accounting principles.
"CURRENT RATIO": as of the last day of each calendar quarter, the
ratio of Current Assets to Current Liabilities.
"DEFAULT": any of the events specified in Section 6, whether or not
any requirement for the giving of notice, the lapse of time, or both, or any
other condition, has been satisfied.
"EBITDA": for the Borrower and its Subsidiaries on a consolidated
basis, Net Income after eliminating extraordinary gains and losses, plus (a)
provisions for taxes, (b) depreciation and amortization, (c) Interest Expense,
(d) other non-cash charges and (e) minority interests in Subsidiaries, all to
the extent deducted in computing Net Income.
"EFFECTIVE DATE": the date on which the conditions precedent set forth
in Section 3.1 have been satisfied, but in no event later than March 31, 1997.
"ERISA": shall mean the Employee Retirement Income Security Act of
1974, as amended from time to time, including (unless the context otherwise
requires) any rules or regulations promulgated thereunder.
"EURODOLLAR BUSINESS DAY": shall mean any day on which banks are open
for dealings in U.S. dollar deposits in the London Interbank Market.
"EVENT OF DEFAULT": shall have the meaning set forth in Section 6,
provided that any requirement for the giving of notice, the lapse of time, or
both, or any other condition, has been satisfied.
"EXCLUDED TAXES": all taxes imposed on or by reference to the net
income of the Bank and all franchise taxes, taxes on doing business or taxes
measured by capital or net worth imposed on the Bank, imposed:
(i) by the jurisdiction in which the Bank is located or in which
the Bank is organized or has its principal or registered office;
(ii) by reason of any connection between the jurisdiction
imposing such tax and the Bank other than a connection arising solely
from this Agreement or any transaction contemplated hereby;
(iii) by the United States or any political subdivision thereof
or therein including without limitation, branch profits taxes imposed
by the U.S. or similar taxes imposed by any subdivision thereof; or
(iv) by reason of the failure of the Bank to provide accurate
documentation required to be provided by the Bank pursuant to Section
8.4(b).
"FEDERAL FUNDS EFFECTIVE RATE": 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 Bank from three (3)
federal funds brokers of recognized standing selected by it. If, for any reason,
the Bank shall have determined (which determination shall be conclusive absent
manifest error) that it is unable to ascertain the Federal Funds Effective Rate
for any reason, including, without limitation, the inability or failure of the
Bank to obtain sufficient quotations in accordance with the terms hereof, the
Alternate Base Rate shall be determined without regard to the Federal Funds
Effective Rate until the circumstances giving rise to such inability no longer
exist.
"FIXED CHARGE COVERAGE RATIO": the ratio of EBITDA for the fiscal
quarter most recently ended and the immediately preceding three (3) fiscal
quarters to the sum of (a) Total Debt Service for the fiscal quarter most
recently ended and the immediately preceding three (3) fiscal quarters and (b)
Cash Income Taxes for the fiscal quarter most recently ended and the immediately
preceding three (3) fiscal quarters.
"INDEBTEDNESS": shall mean, with respect to the Borrower and its
Subsidiaries on a consolidated basis, (a) all indebtedness for borrowed money,
(b) for the deferred purchase price of property or services due more than sixty
(60) days from the date of payment specified on the invoice for such obligation
in respect of which the Borrower is primarily liable as obligor and (c)
obligations under leases which shall have been or should be, in accordance with
generally accepted accounting principles, reported as capital leases in respect
of which the Borrower or its Subsidiaries is primarily liable.
"INTEREST EXPENSE": for the Borrower and its Subsidiaries on a
consolidated basis, as of any date, for the fiscal quarter most recently ended
and the immediately preceding three (3) fiscal quarters, (a) the sum of (i) the
aggregate of all interest expense of the Borrower and its Subsidiaries to the
extent included in the calculation of Net Income for such periods in accordance
with generally accepted accounting principles and (ii) all commitment, letter of
credit or line of credit fees paid, payable and/or accrued for such period
(without duplication of previous amounts) to any lender in exchange for such
lender's commitment to lend or otherwise extend credit, less (b) all interest
income.
"INTEREST PAYMENT DATE": (a) as to an Alternate Base Rate Loan, the
last day of each calendar month while an Alternate Base Rate Loan is
outstanding, (b) as to any LIBOR Loan having an Interest Period of three (3)
months or less, the last day of such Interest Period, (c) as to any LIBOR Loan
having an Interest Period longer than three (3) months, each day which is at the
end of each three-month period within such Interest Period after the first day
of such Interest Period and the last day of such Interest Period and (d) for
each of (a), (b) and (c) above, the day on which the Revolving Credit Loans
become due and payable in full and are paid or are prepaid.
"INTEREST PERIOD": with respect to any LIBOR Loan":
(a) initially, the period commencing on the borrowing or
conversion date, as the case may be, with respect to such LIBOR Loan and ending
on the numerically corresponding day one (1), two (2), three (3) or six (6)
months (or, if reasonably available to the Bank, twelve (12) months) thereafter,
as selected by the Borrower in its notice of borrowing or its continuation
notice, as the case may be, given with respect thereto; and
(b) thereafter, each period commencing on the last day of the
next preceding Interest Period applicable to such LIBOR Loan and ending one (1),
two (2), three (3) or six (6) months (or, if reasonably available to the Bank,
twelve (12) months) thereafter, as selected by the Borrower by irrevocable
notice to the Bank not less than three (3) LIBOR Business Days prior to the last
day of the then current Interest Period with respect thereto;
provided that, all of the foregoing provisions relating to Interest
Periods are subject to the following:
(i) if any Interest Period pertaining to a LIBOR Loan 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;
(ii) any Interest Period which would otherwise extend beyond the date
final payment is due on the Revolving Credit Loans, shall end on the date of
such final payment; and
(iii) any Interest Period pertaining to a LIBOR Loan that begins on
the last day of the calendar month (or on a day for which there is no
numerically corresponding day in the calendar month at the end of such Interest
Period) shall end on the last Business Day of the calendar month.
"LETTERS OF CREDIT": shall have the meaning set forth in Section 2.1
hereof.
"LETTER OF CREDIT AMOUNT": the stated maximum amount available to be
drawn under a particular Letter of Credit, as such amount may be reduced or
reinstated from time to time in accordance with the terms of such Letter of
Credit.
"LIBOR": with respect to each day during each Interest Period
pertaining to a LIBOR Loan, the rate equal to the rate of interest per annum
determined by the Bank to be the arithmetic mean of the rates of interest per
annum appearing on Telerate page 3750 (or any successor publication) for U.S.
dollar deposits in the approximate amount of such LIBOR Loan to be borrowed,
continued or converted and having a maturity comparable to such Interest Period,
at approximately 11:00 a.m. (London time) two (2) Business Days prior to the
commencement of such Interest Period. Notwithstanding the foregoing, if for any
reason rates are not available as provided in the preceding clause, the LIBOR
Rate instead means the rate of interest per annum determined by the Bank to be
the arithmetic mean (rounded upwards to the nearest 1/16th of 1%) of the rates
of interest per annum notified to the Bank as the rate of interest at which U.S.
dollar deposits in the approximate amount of each LIBOR Loan to be borrowed,
continued or converted and having a maturity comparable to such Interest Period,
would be offered to major U.S. banks in the London Interbank Market at their
request at approximately 11:00 a.m. (London time) two Business Days prior to the
commencement of such Interest Period.
"LIBOR ADJUSTED RATE": with respect to each day during each Interest
Period pertaining to a LIBOR Loan, a rate per annum determined for such day in
accordance with the following formula (rounded upward to the nearest 1/100th of
1%):
LIBOR
1.00 minus LIBOR Reserve Requirements
"LIBOR BUSINESS DAY": a day which is a Business Day and a day on which
dealings in U.S. dollar deposits may be carried out in the London Interbank
Market.
"LIBOR LOANS": Revolving Credit Loans the rate of interest applicable
to which is based upon LIBOR.
"LIBOR RESERVE REQUIREMENTS": for any day as applied to a LIBOR Loan,
the aggregate (without duplication) of maximum rates (expressed as a decimal
fraction) of reserve requirements in effect on such day (including, without
limitation, basic, supplemental, marginal and emergency reserves and/or any
regulations of the Board of Governors of the Federal Reserve System or other
governmental authority having jurisdiction with respect thereto) dealing with
reserve requirements prescribed for eurocurrency funding (currently referred to
as "Eurocurrency Liabilities" in Regulation D of such Board) maintained by a
member bank of such Federal Reserve System. As of the Effective Date, there are
no such reserve requirements.
"LOAN ACCOUNT": shall have the meaning set forth in Section 2.1(d)
hereof.
"MATERIAL ADVERSE EFFECT": a material adverse effect on (a) the
business, operations, property or conditions, (financial or otherwise) of the
Borrower and its Subsidiaries on a consolidated basis, (b) the ability of the
Borrower or any of its Subsidiaries to perform its respective obligations
hereunder or (c) the validity or enforceability of this Agreement or the rights
or remedies of the Bank hereunder.
"MATERIAL SUBSIDIARY": shall mean any Subsidiary of the Borrower which
represents at any time (a) 10% of Net Income for the fiscal quarter most
recently ended and the immediately preceding three (3) fiscal quarters, (b) 10%
of the value of the assets as of the end of the most recently ended fiscal
quarter of the Borrower and its Subsidiaries on a consolidated basis or (c) 10%
of the total product sales of the Borrower and its Subsidiaries on a
consolidated basis for the fiscal quarter most recently ended and the
immediately preceding three (3) fiscal quarters.
"MATURITY DATE": in respect of any amount outstanding hereunder, March
31, 1999, unless all such amounts shall have earlier become due and payable,
whether by acceleration or otherwise.
"NET INCOME": net income as determined in accordance with generally
accepted accounting principles and in a manner consistent with the calculations
of net income as set forth in financial statements previously delivered by the
Borrower and its Subsidiaries on a consolidated basis to the Bank.
"NET WORTH": shall mean, as of the calculation date, all assets of the
Borrower and its Subsidiaries on a consolidated basis less all Total Liabilities
of the Borrower and its Subsidiaries on a consolidated basis.
"OBLIGATIONS": shall mean all amounts owing by the Borrower to the
Bank pursuant to this Agreement.
"OPERATING LOSS": a loss from operations before other income and
expenses, interest income and expense, income taxes, translation adjustments and
extraordinary items as set forth on the Borrower's consolidated statement of
income.
"PERMITTED LIENS": shall mean (a) liens and security interests
securing indebtedness owed by the Borrower to the Bank; (b) liens for taxes,
assessments or similar charges either not more than sixty (60) days past due or
being contested in good faith; (c) liens of materialmen, mechanics,
warehousemen, or carriers or other like liens arising in the ordinary course of
business and securing obligations which are not more than sixty (60) days past
due or being contested in good faith; (d) purchase money liens or purchase money
security interests upon or in any property acquired or held by the Borrower and
its Subsidiaries in the ordinary course of business to secure Indebtedness
outstanding on the date hereof or permitted to be incurred under Section 5.9
hereof and any renewals and modifications thereof not increasing the amount of
the obligations thereunder; (e) liens and security interests which, as of the
date hereof, have been disclosed in filings with the Securities and Exchange
Commission or which have been approved by the Bank in writing and any renewals
and modifications thereof not increasing the amount of the obligations
thereunder; (f) liens in connection with workers' compensation, unemployment
insurance, social security obligations and such other types of insurance; (g)
liens to secure performance bonds, bid bonds, contracts, leases, public or
statutory obligations, surety bonds and other similar obligations; (h) liens
resulting from zoning restrictions, easements and such other similar
restrictions on the use of real property; and (i) liens arising from judgments
and attachments that would not constitute an Event of Default hereunder; (j)
liens securing intercompany indebtedness (k) security interest filings
evidencing operating leases; (l) liens on the property or assets of any entity
at the time such entity becomes a Subsidiary after the date hereof and any
renewals and modifications thereof not increasing the amount of the obligation
thereunder; and (m) liens not otherwise covered under this definition in an
aggregate amount not exceeding at any time $15,000,000.
"REFERENCE RATE": the rate of interest per annum publicly announced
from time to time by the Bank as its reference rate in effect at its principal
office in Los Angeles.
"REGULATION D": Regulation D of the Board of Governors of the Federal
Reserve System as the same is from time to time in effect, and all official
rulings and interpretations thereunder or thereof and any successor regulation
thereto.
"REVOLVING CREDIT LOANS": shall have the meaning set forth in Section
2.1 hereof.
"SUBORDINATED DEBT": shall mean such liabilities of the Borrower and
its Subsidiaries which have been subordinated to those owed to the Bank in a
manner acceptable to the Bank.
"SUBSIDIARY": as to any person or entity at any time as determined, a
corporation, partnership or other entity of which shares of stock or other
ownership interest having ordinary voting power (other than stock or such other
ownership interest having such power only by reason of the happening of a
contingency) 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 subsidiaries, or both, by such person or entity.
Unless otherwise qualified, all references to a "subsidiary" or to
"subsidiaries" in this Agreement shall refer to a Subsidiary or Subsidiaries of
the Borrower.
"TANGIBLE NET WORTH": shall mean Net Worth less all intangible assets
of the Borrower and its Subsidiaries (i.e., goodwill, trademarks, patents,
copyrights, organization expense, and similar intangible items).
"TAXES": shall have the meaning set forth in Section 8.4 hereof.
"TOTAL DEBT SERVICE": for the Borrower and its Subsidiaries on a
consolidated basis, as of any date, for the fiscal quarter most recently ended
and the immediately preceding three (3) fiscal quarters, the sum of (a) all
Interest Expense and (b) regularly scheduled principal payments due on
Indebtedness (which result in permanent reductions in availability).
"TOTAL LIABILITIES": for the Borrower and its Subsidiaries on a
consolidated basis, as of any date, the aggregate amount of all items that would
be set forth as liabilities on a balance sheet of the Borrower and its
Subsidiaries on such date in accordance with generally accepted accounting
principles (but not redeemable equity or minority interests).
1.2 ACCOUNTING TERMS: All references to financial statements, assets,
liabilities, and similar accounting items not specifically defined herein shall
mean such financial statements or such items prepared or determined in
accordance with generally accepted accounting principles consistently applied
and, except where otherwise specified, all financial data submitted pursuant to
this Agreement shall be prepared in accordance with such principles. Any change
in generally accepted accounting principles which changes the calculation of
covenants hereunder shall result in the Borrower and the Bank negotiating, in
good faith, to recalculate such covenants on the basis of the new generally
accepted accounting principles.
1.3 OTHER TERMS: Other terms not otherwise defined shall have the
meanings attributed to such terms in the California Uniform Commercial Code.
SECTION 2
CREDIT
2.1 REVOLVING CREDIT LOANS AND LETTERS OF CREDIT (a) Subject to the
terms and conditions of this Agreement, the Bank agrees to (i) make revolving
credit loans ("Revolving Credit Loans") to the Borrower at any time and from
time to time on and after the Effective Date and until the Maturity Date and
(ii) issue letters of credit ("Letters of Credit") for the account of the
Borrower pursuant to Section 2.2 from time to time from and including the
Effective Date until the Maturity Date; provided, however, that at no time shall
the outstanding aggregate principal amount of all Revolving Credit Loans made by
the Bank, together with the aggregate Letter of Credit Amount of all outstanding
Letters of Credit exceed the Commitment. Within the Commitment, the Borrower may
borrow, have Letters of Credit issued for the Borrower's account, prepay
Revolving Credit Loans, reborrow Revolving Credit Loans and have additional
Letters of Credit issued for the Borrower's account. The Commitment shall
automatically and permanently terminate on the Maturity Date. The minimum amount
of each Revolving Credit Loan shall be $500,000 or an integral multiple thereof.
(b) The Borrower shall give to the Bank irrevocable written
notice (which notice must be received by the Bank prior to 10:00 a.m., Los
Angeles time, one (1) Business Day prior to each proposed borrowing date or, if
all or any part of the Revolving Credit Loans are requested to be made as LIBOR
Loans, three (3) Eurodollar Business Days prior to each proposed borrowing date)
requesting that the Bank make the Revolving Credit Loans on the proposed
borrowing date and specifying (i) the aggregate amount of Revolving Credit Loans
requested to be made, (ii) subject to Section 2.1(e), whether the Revolving
Credit Loans are to be LIBOR Loans, Alternate Base Rate Loans or a combination
thereof and (iii) if the Revolving Credit Loans are to be entirely or partly
LIBOR Loans, the respective amounts of each type of Revolving Credit Loan and
the respective lengths of the Interest Periods therefor.
(c) Proceeds from the Revolving Credit Loans shall be used for
general operating requirements of the Borrower including financing of fixed
assets acquired in the ordinary course of business, refinancing of existing
indebtedness and making acquisitions.
(d) The Bank shall maintain on its books a record of account
in which the Bank shall make entries setting forth all Revolving Credit Loans
made, all Letters of Credit issued, all payments made, the application of such
payments to interest and principal, accrued and unpaid interest (if any) and the
outstanding principal balance under the Revolving Credit Loans (the "Loan
Account"). The Bank shall provide the Borrower with a monthly statement of the
Loan Account, which statement shall be considered to be correct and conclusively
binding on the Borrower, absent manifest error.
(e) Subject to Sections 8.1
and 8.2, the Revolving Credit Loans may from time to time be (i) LIBOR Loans,
(ii) Alternate Base Rate Loans or (iii) a combination thereof, as determined by
the Borrower and notified to the Bank in accordance with the either Section
2.1(b) or 2.1(f). Notwithstanding the foregoing, the initial Revolving Credit
Loans made on or after the Effective Date shall be made as Alternate Base Rate
Loans and shall be subject to conversion to LIBOR Loans pursuant to Section
2.1(f).
Interest on LIBOR Loans shall bear interest at the rate equal
to the LIBOR Adjusted Rate plus a margin of 1.00% per annum and the Alternate
Base Rate Loans shall bear interest at the applicable Alternate Base Rate.
Interest on all Revolving Credit Loans shall be paid on each
applicable Interest Payment Date.
Interest shall be calculated on the basis of a year of 365/366
days (as applicable) for actual days that elapsed, in the case of Revolving
Credit Loan bearing interest at the Reference Rate. Interest on all other
Revolving Credit Loans shall be calculated on the basis of a year of 360 days
for actual days elapsed.
(f) The Borrower may elect from time to time to convert LIBOR
Loans to Alternate Base Rate Loans, by the Borrower giving the Bank at least two
(2) Business Days' prior irrevocable written notice of such election, provided
that any such conversion of LIBOR Loans may only be made on the last day of an
Interest Period with respect thereto. The Borrower may elect from time to time
to convert Alternate Base Rate Loans to LIBOR Loans by the Borrower giving the
Bank at least three LIBOR Business Days' prior irrevocable written notice of
such election. Any such notice of conversion to LIBOR Loans shall specify the
length of the initial Interest Period or Interest Periods therefor. All or any
part of outstanding LIBOR Loans and Alternate Base Rate Loans may be converted
as provided herein, provided that (i) any such conversion may only be made if,
after giving effect thereto, each such LIBOR Loan or Alternate Base Rate Loan
shall be equal to at least $500,000 or an integral multiple thereof, (ii) no
Revolving Credit Loan may be converted into a LIBOR Loan after the date that is
one (1) month prior to the Maturity Date and (iii) the Borrower shall not have
the right to elect or to continue at the end of the applicable Interest Period,
or to convert to, a LIBOR Loan if a Default shall have occurred and be
continuing.
Any LIBOR Loan may be continued as such upon the expiration of the
then current Interest Period with respect thereto by the Borrower giving notice
to the Bank in accordance with Section 2.1(b), of the length of the next
Interest Period to be applicable to such LIBOR Loan, provided that no LIBOR Loan
may be continued as such (i) if, after giving effect thereto, each such LIBOR
Loan would be less than $500,000 or an integral multiple thereof, (ii) after the
date that is one (1) month prior to the Maturity Date or (iii) if a Default
shall have occurred and be continuing and provided, further, that if the
Borrower shall fail to give any required notice as described above in this
Section or if such continuation is not permitted pursuant to the preceding
proviso, such LIBOR Loan shall be automatically converted to Alternate Base Rate
Loans on the last day of such then-expiring Interest Period.
(g) The Borrower may on the last day of any Interest Period
with respect thereto, in the case of LIBOR Loans, or at any time and from time
to time, in the case of Alternate Base Rate Loans, prepay such amounts, in whole
or in part, without premium or penalty, upon at least three (3) Business Days'
irrevocable written notice, in the case of both LIBOR Loans and Alternate Base
Rate Loans, from the Borrower to the Bank, specifying the date and amount of
prepayment and whether the prepayment is of LIBOR Loans or Alternate Base Rate
Loans or a combination thereof, and, if of a combination thereof, the amount
allocable to each. If any such notice is given, the amounts specified in such
notice shall be due and payable by the Borrower on the date specified therein,
together with accrued interest to such date on the amount prepaid and any other
amounts payable hereunder. Partial prepayments of Revolving Credit Loans shall
be in an aggregate principal amount at least equal to $1,000,000 or an integral
multiple thereof or the amount of Revolving Credit Loans outstanding, if less.
If LIBOR Loans are prepaid by reason of acceleration or otherwise on other than
the last day of an Interest Period, the Borrower shall upon the Bank's request,
promptly pay to and indemnify the Bank for all costs and any losses (including
interest) actually incurred by the Bank and any losses (including loss of profit
resulting from the re-employment of funds) sustained by the Bank as a
consequence of such prepayment. Any prepayment shall first be applied to pay
accrued interest, then be applied to pay the principal of Revolving Credit
Loans.
(h) The Borrower hereby promises and agrees to pay the
outstanding principal of all Revolving Credit Loans on the Maturity Date.
Each payment received by the Bank shall be applied to pay
interest then due and unpaid and the remainder thereof (if any) shall be applied
to pay principal.
(i) The Borrower agrees to pay to the Bank a commitment fee of
.25% per annum on the unutilized portion of the Commitment for the period from
the Effective Date to but excluding the Maturity Date (and, for purposes of this
calculation, issued Letters of Credit shall be deemed usage of the Commitment),
payable quarterly in arrears and computed on a year of 360 days for actual days
elapsed.
(j) The Borrower agrees to pay to the Bank an up-front
facility fee on the Effective Date equal to 1/4 of 1% of the Commitment.
(k) At the Borrower's option and upon at least five (5)
Business Days' prior irrevocable notice to the Bank, with such notice specifying
the amount and the date of such reduction, the Borrower may permanently reduce
the Commitment in whole at any time or in part from time to time; provided,
however, that each partial reduction of the Commitment shall be in an aggregate
amount equal to at least $1,000,000 or an integral multiple thereof or the
amount of the Commitment, if less. Upon each reduction of the Commitment, the
Borrower shall (i) pay the commitment fee, payable pursuant to Section 2.1(i),
accrued on the amount of the Commitment so reduced through the date of such
reduction, (ii) prepay the amount, if any, by which the sum of (A) the aggregate
unpaid principal amount of the Revolving Credit Loans and (B) the aggregate
Letter Credit Amount of all Letters of Credit outstanding exceed the amount of
the Commitment as so reduced, together with accrued interest on the amount being
prepaid to the date of such prepayment (or, with respect to outstanding Letters
of Credit, make a cash collateral deposit in an amount equal to such excess to
the extent such excess is not corrected by the foregoing prepayment) and (iii)
compensate the Bank for its funding costs, if any, in accordance with Section
8.5.
. 2.2 ISSUANCE OF LETTERS OF CREDIT
(a) The Borrower shall be entitled to request the issuance of
Letters of Credit from time to time from and including the Effective Date to but
excluding the date which is thirty (30) Business Days prior to the Maturity Date
by giving the Bank a Letter of Credit request at least three (3) Business Days
before the requested date of issuance of such Letter of Credit (which shall be a
Business Day). Any Letter of Credit Request received by the Bank later than
10:00 a.m., Los Angeles time, shall be deemed to have been received on the next
Business Day. Such Letter of Credit request shall be made in writing, shall be
signed by an authorized officer of the Borrower, shall be irrevocable and shall
be effective upon receipt by the Bank. Provided that a valid Letter of Credit
request has been received by the Bank and upon fulfillment of the other
applicable conditions set forth in Section 3, the Bank will issue the requested
Letter of Credit from its office specified in Section 9.4. No Letter of Credit
shall have an expiration date later than three (3) Business Days prior to the
Maturity Date.
(b) The payment by the Bank of a draft drawn under any Letter
of Credit shall first be made from any cash collateral deposit held by the Bank
with respect to such Letter of Credit. After any such cash collateral deposit
have been applied, prepayment by the Bank of a draft drawn under any Letter of
Credit shall constitute for all purposes of this Agreement the making by the
Bank of an Alternate Base Rate Loan in the amount of such payment (but without
any requirement of compliance with the conditions set forth in Section 3 and
without regard to any minimum borrowing amount).
(c) The obligations of the Borrower with respect to any Letter
of Credit, any Letter of Credit request and any other agreement or instrument
relating to any Letter of Credit and any Alternate Base Rate Loan made under
Section 2.2(b) shall be absolute, unconditional and irrevocable and shall be
paid strictly in accordance with the aforementioned documents under all
circumstances, including the following:
(i) any lack of validity or enforceability of any Letter of
Credit, this Agreement or any other related documents;
(ii) the existence of any claim, setoff, defense or other right
that the Borrower may have at any time against any beneficiary or
transferee of any Letter of Credit (or any person for whom any such
beneficiary or transferee may be acting), the Bank or any person,
whether in connection with this Agreement, and any other related
documents, the transactions contemplated hereby or thereby or any
unrelated transaction;
(iii) any statement or other document presented under any Letter
of Credit proving to be forged, fraudulent, invalid or insufficient in
any respect, or any statement therein being untrue or inaccurate in
any respect whatsoever;
(iv) payment by the Bank under any Letter of Credit against
presentation of the draft or certificate that does not substantially
comply on its face with the terms of such Letter of Credit;
(v) any exchange, release or non-perfection of any collateral or
any of the lease, amendment or waiver of or consent to departure from
any guarantee for any of the Obligations of the Borrower in respect of
the Letters of Credit; and
(vi) any other circumstance or happening whatsoever, whether or
not similar to any of the foregoing.
(d) The Borrower shall pay to the Bank with respect to each
Letter of Credit issued hereunder, for the period from and including the day
such Letter of Credit is issued to but excluding the day such Letter of Credit
expires or is cancelled, a letter of credit fee equal to 1.00% per annum of the
Letter of Credit Amount of such Letter of Credit from time to time, such letter
of credit fee to be payable quarterly in arrears on the last day of each March,
June, September and December and on the expiration date or cancellation date of
such Letter of Credit.
(e) The Borrower shall pay to the Bank with respect to each
Letter of Credit issued hereunder, for the period from and including the day
such Letter of Credit is issued to but excluding the day such Letter of Credit
expires, such additional fees and charges (including cable charges) as are
generally associated with letters of credit, in accordance with the Bank's
standard internal charge guidelines and the related Letter of Credit request.
(f) The Borrower assumes all risks of the acts or omissions of
any beneficiary or transferee of any Letter of Credit with respect to its use of
such Letter of Credit. Neither the Bank nor any of its officers or directors
shall be liable or responsible for (i) the use that may be made of any Letter of
Credit or any acts or omissions of any beneficiary or transferee in connection
therewith; (ii) the validity, sufficiency or genuineness of documents, or of any
endorsement thereof, even if such documents should prove to be in any or all
respects invalid, insufficient, fraudulent or forged; (iii) payment by the Bank
against presentation of documents that do not comply with the terms of any
Letter of Credit, including failure of any documents to bear any reference or
adequate reference to any Letter of Credit; or (iv) any other circumstance
whatsoever in making or failing to make payment under any Letter of Credit. In
furtherance and not in limitation of the foregoing, the Bank may accept any
document that appears on its face to be in order, without responsibility for
further investigation, regardless of any notice or information to the contrary.
Notwithstanding anything herein to the contrary, the Borrower shall not be
responsible for any acts of gross negligence or willful misconduct by the Bank.
SECTION 3
CONDITIONS OF LENDING
3.1 CONDITIONS PRECEDENT TO THE INITIAL REVOLVING CREDIT LOAN OR
LETTER OF CREDIT: The obligation of the Bank to make the first extension of
credit (either by a Revolving Credit Loan or a Letter of Credit) to or on
account of the Borrower hereunder is subject to the conditions precedent that
the Bank shall have received before the date of such first extension of credit
all of the following, in form and substance reasonably satisfactory to the Bank:
(a) Evidence that the execution, delivery and performance by
the Borrower of this Agreement and any document, instrument or agreement
required hereunder have been duly authorized.
(b) The up-front facility fee referred to in Section 2.1(j).
(c) An incumbency certificate of the Borrower dated the
Effective Date executed by one of its authorized officers or its Secretary or
Assistant Secretary.
(d) A copy of the resolutions of the Board of Directors of the
Borrower dated as of the Effective Date authorizing (i) the execution, delivery
and performance of this Agreement and related documents to which the Borrower is
or will become a party and (ii) the borrowings contemplated hereunder, in each
case certified by the Secretary or Assistant Secretary, which certificate states
that the resolutions thereby certified have not been amended, modified, revoked
or rescinded and are in full force and effect.
(e) Copies of the Certificate of Incorporation and Bylaws of
the Borrower, certified as of the Effective Date as complete and correct copies
thereof by the Secretary or Assistant Secretary of the Borrower.
(f) Payment of all fees, costs and expenses accrued and unpaid
and otherwise due and payable on or before the Effective Date by the Borrower in
connection with Section 9.3 of this Agreement.
(g) The executed legal opinion of David C. Watt, general
counsel to the Borrower, in form and substance reasonably acceptable to the
Bank.
(h) A certificate, dated a recent date, of the Secretaries of
the States of Delaware and California and each other jurisdiction where the
Borrower is required to be qualified to do business under such jurisdiction's
law, certifying as to the existence and good standing of, and the payment of
taxes by, the Borrower in each such state and listing all charter documents of
the Borrower on file with such officials.
(i) such other evidence as the Bank may reasonably request to
establish the consummation of the transaction contemplated hereunder and
compliance with the conditions of this Agreement.
3.2 CONDITIONS PRECEDENT TO EACH REVOLVING CREDIT LOAN OR LETTER OF
CREDIT : The obligation of the Bank to make each Revolving Credit Loan
(including the initial Revolving Credit Loan) or to issue each Letter of Credit
(including the initial Letter of Credit) to or on account of the Borrower
hereunder is subject to the following conditions precedent, which shall be
deemed certified by the Borrower to the Bank with each delivery of a borrowing
notice or Letter of Credit request:
(a) The following are true as of each borrowing date and on
each date on which a Letter of Credit is issued:
(i) The representations and warranties contained in
this Agreement and in each of the related documents and certificates
delivered to the Bank prior to, on or after the Effective Date pursuant
hereto and on or prior to the date for such Revolving Credit Loan or
the issuance of such Letter of Credit are correct on and as of such
date in all material respects as though made on and as of such date,
except to the extent that such representations and warranties expressly
relate to an earlier date;
(ii) No Default has occurred and is continuing or would
result from the making of the Revolving Credit Loan to be made on such
date or the issuance of such Letter of Credit as of such date; and
(iii) The making of such Revolving Credit Loan or the
issuance of such Letter of Credit, as applicable, shall not contravene
any law, rule or regulation applicable to the Borrower.
(b) The Bank shall have received a borrowing notice or Letter
of Credit request, as applicable, pursuant to the provisions of this Agreement
from the Borrower.
SECTION 4
REPRESENTATIONS AND WARRANTIES
The Borrower hereby makes the following representations and warranties
to the Bank, which representations and warranties are true and correct:
4.1 STATUS: The Borrower is a corporation duly organized and validly
existing under the laws of the State of Delaware and it and each Subsidiary is
properly licensed and is qualified to do business and in good standing in, and,
where necessary to maintain the Borrower's and such Subsidiary's rights and
privileges, has complied in all material respects with the fictitious name
statute of every jurisdiction in which the Borrower or such Subsidiary is doing
business, except where the failure to do so would result or could reasonably be
expected to result in a Material Adverse Effect.
4.2 AUTHORITY: The execution, delivery and performance by the Borrower
of this Agreement and any instrument, document or agreement required hereunder
have been duly authorized and do not: (a) violate any provision of any law,
rule, regulation, order, writ, judgment, injunction, decree, determination or
award presently in effect having application to the Borrower or any Subsidiary,
(b) result in a breach of or constitute a default under any material indenture
or loan or credit agreement or other material agreement, lease or instrument to
which the Borrower or any Subsidiary is a party or by which it or its properties
may be bound or affected; or (c) require any consent or approval of its
stockholders or violate any provision of its certificate of incorporation or
by-laws.
4.3 LEGAL EFFECT: This Agreement constitutes, and any instrument,
document or agreement required hereunder when delivered hereunder will
constitute, legal, valid and binding obligations of the Borrower enforceable
against the Borrower in accordance with their respective terms except as the
same may be limited by applicable bankruptcy, insolvency, reorganization or
similar laws relating to or limiting creditors' rights generally and subject to
the availability of equitable remedies.
4.4 FINANCIAL STATEMENTS: The audited consolidated balance sheet of
the Borrower and its Subsidiaries as at December 31, 1995 and the related
audited consolidated statements of operations, changes in stockholders' equity
and statements of cash flows for the fiscal year ended on such date, copies of
which have heretofore been furnished to the Bank, present fairly the
consolidated financial condition of the Borrower and its Subsidiaries as at such
date in all material respects, and the consolidated results of their operations,
consolidated changes in stockholders' equity and their consolidated cash flows
for the fiscal year then ended in all material respects. The unaudited
consolidated balance sheet of the Borrower and its Subsidiaries as at September
30, 1996 and the related unaudited consolidated statements of operation and cash
flows for the nine-month period ended on such date, a copy of which has
heretofore been furnished to the Bank, present fairly the consolidated financial
condition of such entities at such date in all material respects (subject to
normal year-end audit adjustments), and the consolidated results of their
operations and their respective consolidated cash flows for the nine-month
period then ended. All such financial statements, including the related
schedules and notes thereto, have been prepared in accordance with generally
accepted accounting principles applied consistently throughout the periods
involved. Since the most recent submission of such financial information or data
to the Bank, the Borrower represents and warrants that no material adverse
change in the financial condition or operations of the Borrower and its
Subsidiaries taken as a whole has occurred which has not been fully disclosed to
the Bank in writing.
4.5 LITIGATION: Except as have been disclosed to the Bank or disclosed
in reports filed with the Securities and Exchange Commission, there are no
actions, suits or proceedings pending or, to the knowledge of the Borrower,
threatened against or affecting the Borrower or the Borrower's Subsidiaries or
properties before any court or administrative agency which could reasonably be
expected, if determined adversely to the Borrower or any Subsidiary, to have a
material adverse effect on the Borrower's consolidated financial condition or
operations.
4.6 TITLE TO ASSETS: The Borrower and each Subsidiary has good and
marketable title to all of its assets, except for assets which are leased and
except whether the failure to have such title would not result or could
reasonably be expected to result in a Material Adverse Effect. Such assets are
not subject to any security interest, encumbrance, lien or claim of any third
person except for Permitted Liens.
4.7 ERISA: If the Borrower or any Subsidiary has a pension, profit
sharing or retirement plan subject to ERISA, such plan has been funded in
accordance with its terms and otherwise complies in all material respects with
the requirements of ERISA, except as disclosed in writing to the Bank prior to
the date of this Agreement.
4.8 TAXES: The Borrower and each Subsidiary has filed all tax returns
required to be filed and paid all taxes shown thereon to be due, including
interest and penalties, other than such taxes which are currently payable
without penalty or interest or those which are being duly contested in good
faith.
4.9 REGULATION U: The proceeds of the Revolving Credit Loans will not
be used to purchase or carry margin stock.
4.10: ENVIRONMENTAL COMPLIANCE: The Borrower and each Subsidiary has
implemented and complied in all material respects with all applicable federal,
state and local laws, ordinances, statutes and regulations with respect to
hazardous or toxic wastes, substances or related materials, industrial hygiene
or environmental conditions, except where the failure to so comply would not
result or could reasonably be expected to result in a Material Adverse Effect.
Except as previously disclosed to the Bank or in filings of the Borrower with
the Securities and Exchange Commission, there are no suits, proceedings, claims
or disputes pending or, to the knowledge of the Borrower or any Subsidiary,
threatened against or affecting the Borrower or any Subsidiary or its property
claiming violations of any federal, state or local law, ordinance, statute or
regulation relating to hazardous or toxic wastes, substances or related
materials which could reasonably be expected, if determined adversely to the
Borrower or any Subsidiary, to have a Material Adverse Effect.
SECTION 5
COVENANTS
The Borrower covenants and agrees that, during the term of this
Agreement, and so long thereafter as the Borrower is indebted to the Bank under
this Agreement, the Borrower will and will cause each Material Subsidiary to,
unless the Bank shall otherwise consent in writing:
5.1 PRESERVATION OF EXISTENCE; WITH APPLICABLE LAWS: Subject to
Section 5.12, maintain and preserve its existence; not liquidate or dissolve,
merge or consolidate with or into, any other business organization (other than
the Borrower or any Subsidiary); and conduct its business and operations in
accordance in all material respects with all applicable laws, rules and
regulations.
5.2 MAINTENANCE OF INSURANCE: Maintain insurance in such amounts and
covering such risks as is usually and prudently carried by companies engaged in
similar businesses and owning similar properties in the same general areas in
which the Borrower and its Material Subsidiaries operate; provided that the
Borrower and its Material Subsidiaries shall be permitted to self-insure against
product liability risks.
5.3 MAINTENANCE OF PROPERTIES: Subject to Section 5.12, maintain and
preserve all its properties in good working order and condition in accordance
with the general practice of other businesses of similar character and size,
ordinary wear and tear excepted.
5.4 PAYMENT OF OBLIGATIONS AND TAXES: Make timely payment of all
assessments and taxes and all of its liabilities and obligations unless the same
are being contested in good faith by appropriate proceedings with the
appropriate court or regulatory agency, provided however that the Borrower and
its Material Subsidiaries may make payment of trade payables in accordance with
its customary business practices. For purposes hereof, the issuance of a check,
draft or similar instrument without delivery to the intended payee shall not
constitute payment.
5.5 INSPECTION RIGHTS: At any reasonable time and from time to time,
permit the Bank or any representative thereof to examine and make copies of the
records as the Bank may reasonably request and visit the properties of the
Borrower and its Subsidiaries and discuss the business and operations of the
Borrower and its Subsidiaries with any designated representative thereof. If the
Borrower and its Subsidiaries shall maintain any records (including, but not
limited to, computer generated records or computer programs for the generation
of such records) in the possession of a third party, the Borrower and its
Subsidiaries hereby agree to notify such third party to permit the Bank free
access to such records at all reasonable times and to provide the Bank with
copies of any records which it may reasonably request. The costs and expenses
associated with the first such visit and examination in any fiscal year shall be
at the Borrower's expense, the amount of which shall be payable within thirty
(30) days following demand. Any subsequent visits or examinations in the same
fiscal year shall be at the Bank's expense.
5.6 REPORTING AND CERTIFICATION REQUIREMENTS: Deliver or cause to be
delivered to the Bank in form and detail reasonably satisfactory to the Bank:
(a) Not later than one hundred (100) days after the end of
each of the Borrower's fiscal years, a copy of the annual audited consolidated
financial report of the Borrower and its Subsidiaries for such year, all
certified to as having been prepared in accordance with generally accepted
accounting principles consistently applied by Coopers & Lybrand or another firm
of certified public accountants reasonably acceptable to Bank.
(b) Not later than fifty-five (55) days after the end of each
fiscal quarter, the consolidated balance sheet and income statement for the
Borrower and its Subsidiaries, each as of the end of such period.
(c) Not later than fifty-five (55) days after the end of each
fiscal quarter, a certificate of the chief financial officer of the Borrower
demonstrating compliance as of the end of such period with each financial
covenant set forth herein, all in form satisfactory to the Bank.
(d) Not later than fifty-five (55) days after the end of each
fiscal quarter, a certificate of an authorized officer of the Borrower updating
any outstanding litigation in which the claim or liability exceeds $10,000,000
against the Borrower or any of its Subsidiaries as of the end of such period,
all in form satisfactory to the Bank.
(e) Not later than ten (10) days after sending or filing
thereof, copies of all regular and periodic reports and all registration
statements (including, but not limited to, Form 10-K and Form 10-Q) and
prospectuses, if any, filed by the Borrower or any of its Subsidiaries with any
securities exchange or with the Securities and Exchange Commission or any
governmental or private regulatory authority (other than reports of a routine or
ministerial nature which are not material).
(f) Promptly upon the Bank's request, such other information
pertaining to the Borrower as the Bank may reasonably request.
5.7 PAYMENT OF DIVIDENDS: Not declare or pay any dividends on any
class of stock now or hereafter outstanding except (a) dividends payable solely
in the Borrower's capital stock, (b) dividends by Subsidiaries and (c) dividends
payable on any class of the Borrower's stock not to exceed, in any fiscal year,
$40,000,000 in aggregate amount and not to exceed, during the term of this
Agreement, $60,000,000 in aggregate amount (or such higher amount as the Bank
and the Borrower shall negotiate in good faith).
5.8 REDEMPTION OR REPURCASE OF STOCK: Not redeem or repurchase any
class of the Borrower's stock now or hereafter outstanding, except redemptions
or repurchases of any class of the Borrower's stock not to exceed, in any fiscal
year, $40,000,000 in aggregate amount and not to exceed, during the term of this
Agreement, $60,000,000 in aggregate amount (or such higher amount as the Bank
and the Borrower shall negotiate in good faith).
5.9 ADDITIONAL INDEBTEDNESS: Not, after the date hereof, create, incur
or assume, directly or indirectly, any additional Indebtedness or any commitment
therefor other than (a) Indebtedness owed or to be owed to the Bank, (b)
intercompany Indebtedness, (c) other Indebtedness outstanding from time to time
in an aggregate amount not to exceed, at any time, $250,000,000 or (d) renewals
or refinancing of Indebtedness existing on the date hereof but only to the
extent of the principal of the Indebtedness outstanding on the date hereof.
5.10 LOANS: Not make any loans or advances or extend credit to any
third person (other than a Subsidiary), including, but not limited to,
directors, officers, shareholders or employees of the Borrower and its
Subsidiaries, except for (a) credit extended in the ordinary course of the
Borrower's or its Subsidiaries' business as presently conducted, (b) loans or
advances outstanding on the date hereof and (c) loans or advances currently or
in the future outstanding not to exceed, at any time, $2,000,000 in aggregate
amount.
5.11 LIENS AND ENCUMRANCES: Not create, assume or permit to exist any
security interest, encumbrance, mortgage, deed of trust, or other lien affecting
any of the Borrower's properties or any properties of its Material Subsidiaries,
or execute or allow to be filed any financing statement or continuation thereof
affecting any of such properties, except for Permitted Liens or as otherwise
provided in this Agreement.
5.12 TRANSFER ASSETS: Not, after the date hereof, sell, contract for
sale, convey, transfer, assign, lease or sublet (a "Transfer"), any of its
assets except (a) in the ordinary course of business as presently conducted by
the Borrower and its Subsidiaries, which ordinary course of business includes,
but is not limited to, sale-leasebacks of equipment and, then, only in an arm's
length transaction and (b) during the term of this Agreement, Transfer of assets
not exceeding, when combined with previous asset Transfers, fifteen percent
(15%) of the value of total assets (calculated at book value) of the Borrower
and its Subsidiaries on a consolidated basis as of the end of the most recently
completed fiscal quarter.
5.13 CHANGE IN NATURE OF BUSINESS: Not make any material change in the
fundamental nature of its business existing or conducted as of the date hereof.
5.14 FINANCIUAL CONDITION: Maintain at the end of each fiscal
quarter:IAL CONDITION
(a) A minimum consolidated Tangible Net Worth of at least
$250,000,000, plus 75% of the sum of Net Income for each fiscal quarter
beginning on or after the date hereof.
(b) A Fixed Charge Coverage Ratio of not less than 2.0 to 1.0.
(c) A Current Ratio of not less than 2.0 to 1.0. For the
purposes hereof, outstanding amounts under any revolving lines of credit shall
be included in Current Liabilities.
(d) A ratio of Total Liabilities to Tangible Net Worth of not
more than:
1.75 to 1.00 for the quarter ending December 31, 1996
1.50 to 1.00 for each fiscal quarter in 1997
1.25 to 1.00 for each fiscal quarter in 1998
5.15 NOTICE: Give the Bank prompt written notice of any and all (a)
Defaults; (b) litigation, arbitration or administration proceedings to which the
Borrower is a party and which would be required to be reported to the Securities
and Exchange Commission and (c) other matters, other than matters of a general
economic nature (other than those matters relating primarily to the Borrower or
its Subsidiaries or the industries in which the Borrower or its Subsidiaries
conducts its respective businesses) which have resulted in, or could reasonably
be expected to, result in a Material Adverse Effect.
5.16 CONSOLIDATED OPERATING LOSS: Not incur for any two consecutive
fiscal quarters an Operating Loss.
5.17 ENVIRONMENTAL COMPLIANCE: SHALL:
(a) Implement and comply in all material respects with all
applicable federal, state and local laws, ordinances, statutes and regulations
with respect to hazardous or toxic wastes, substances or related materials,
industrial hygiene or to environmental conditions.
(b) Own, use, generate, manufacture, store, handle, treat,
release or dispose of any hazardous or toxic wastes, substances or related
materials, only if such ownership or use would not result, or could reasonably
be expected to result, in a Material Adverse Effect.
(c) Give prompt written notice to the Bank of any discovery of
or suit, proceeding, claim, dispute, threat, inquiry or filing respecting
hazardous or toxic wastes, substances or related materials.
(d) At all times indemnify and hold harmless the Bank from and
against any and all liability arising out of the Borrower's or any Subsidiary's
use, generation, manufacture, storage, handling, treatment, disposal or presence
of hazardous or toxic wastes, substances or related materials.
5.18 Subordinated Debt: Not make any prepayment of principal, interest
or any other amount on Subordinated Debt until the Bank has been repaid in full
all Obligations.
5.19 Investments: Not acquire for consideration any evidence of
Indebtedness, stock or other securities of any person or entity, except as so
long as no Default then exists or would be caused thereby, the Borrower and its
Subsidiaries may make investments as follows:
(a) Purchase marketable, direct obligations of the U.S.
maturing within three hundred sixty-five (365) days of the date of purchase;
(b) Purchase commercial paper issued by corporations, each of
which conducts a substantial part of its business in the U.S., maturing within
one hundred eighty (180) days from the date of the original issue thereof, and
rated "P-1" or better by Moody's Investors Service or "A-1" or better by
Standard & Poor's Corporation;
(c) Acquisition of a majority of the voting interest of other
companies, divisions of other companies or product lines;
(d) overnight deposits; and
(e) such other investments which shall not, in aggregate
amount, at any time exceed $100,000,000.
SECTION 6
EVENTS OF DEFAULT
Any one or more of the following described events shall constitute an
event of default (an "Event of Default") under this Agreement:
6.1 NON-PAYMENT: The Borrower shall fail to pay any principal on any
Revolving Credit Loan when due or shall fail to pay any other Obligation within
five (5) days after the date when due.
6.2 PERFORMANCE UNDER THIS AND OTHER AGREEMENT: The Borrower or any
Subsidiary shall fail in any material respect to perform or observe any term,
covenant or agreement contained in this Agreement or in any document, instrument
or agreement evidencing or relating to any Indebtedness in excess of $10,000,000
(whether such Indebtedness is owed to the Bank or to third persons if such
failure would permit such third persons to accelerate the Indebtedness), and any
such failure (exclusive of the payment of money to the Bank under this Agreement
or under any other instrument, document or agreement, which failure shall
constitute and be an immediate event of default if not paid when due or when
demanded to be due, but after giving effect to any grace period therefore) shall
continue for more than fifteen (15) days after written notice from the Bank to
the Borrower of the existence and character of such event of default.
6.3 REPRESENTATIONS AND WARRANTIES; FINANCIAL STATEMENTS: Any
representation or warranty made by the Borrower under or in connection with this
Agreement or any financial statement given by the Borrower shall prove to have
been incorrect in any material respect when made or given or when deemed to have
been made or given.
6.4 INSOLVENCY: The Borrower or any Material Subsidiary shall: (a)
become insolvent or be unable to pay (due to reasons other than currency
liquidity problems) its debts as they mature; (b) make an assignment for the
benefit of creditors or to an agent authorized to liquidate any substantial
amount of its properties and assets; (c) file a voluntary petition in bankruptcy
or seeking reorganization or to effect a plan or other arrangement with
creditors; (d) file an answer admitting the material allegations of an
involuntary petition relating to bankruptcy or reorganization or join in any
such petition; (e) be adjudicated a bankrupt; (f) apply for or consent to the
appointment of, or consent that an order be made, appointing any receiver,
custodian or trustee, for itself or any of its properties, assets or businesses;
or (g) any receiver, custodian or trustee shall have been appointed for all or
substantial part of its properties, assets or businesses and shall not be
discharged within sixty (60) days after the date of such appointment.
6.5 EXECUTION: Any writ of execution or attachment or any judgment
lien which individually exceeds $5,000,000 or which, in the aggregate, exceeds
$10,000,000, shall be issued against any property of the Borrower or any
Subsidiary and there shall be any period of sixty (60) consecutive days during
which a stay of enforcement of such writ or judgment by reason of a pending
appeal, or otherwise, shall not be in effect.
6.6 SUSPENSION: The Borrower or any Material Subsidiary shall
voluntarily suspend the transaction of business or allow to be suspended,
terminated, revoked or expired any permit, license or approval of any
governmental body materially necessary to conduct the Borrower's or any Material
Subsidiary's business as now conducted if such suspension, termination,
revocation or expiration would result or could reasonably be expected to result
in a Material Adverse Effect.
6.7 CHANGE IN OWNERSHIP: There shall occur a sale, transfer,
disposition or encumbrance (whether voluntary or involuntary), or an agreement
shall be entered into to do so with, any Person or group of Persons (as such
terms are defined pursuant to Federal securities laws) with respect to more than
thirty-five percent (35%) of the issued and outstanding capital stock of the
Borrower and, as a result thereof, such Person or group of Persons has the
ability to direct or cause the direction of the management and policies of the
Borrower.
SECTION 7
REMEDIES ON DEFAULT
Upon the occurrence and during the continuation of any Event of
Default, the Bank may, at its sole and absolute election, without demand and
only upon such notice as may be required by law:
7.1 ACCELERATION: Declare any or all of the Borrower's Indebtedness
owing to the Bank, whether under this Agreement or any other document,
instrument or agreement, immediately due and payable, whether or not otherwise
due and payable.
7.2 CEASE EXTENDING CREDIT: Cease extending credit to or for the
account of the Borrower under this Agreement or under any other agreement now
existing or hereafter entered into between the Borrower and the Bank.
7.3 TERMINATION: Terminate this Agreement as to any future obligation
of the Bank without affecting the Borrower's Obligations to the Bank or the
Bank's rights and remedies under this Agreement or under any other document,
instrument or agreement.
7.4 CASH COLLATERAL: To the extent any Letters of Credit are then
outstanding, demand that the Borrower make a cash collateral deposit in an
amount equal to the aggregate Letter of Credit Amount. Any such cash collateral
shall first be used to reimburse the Bank for drawings under outstanding Letters
of Credit. Upon expiration and payment of all Letters of Credit, any remaining
cash collateral shall be applied to repay outstanding Revolving Credit Loans.
7.5 NON-EXCLUSIVITY OF REMEDIES: Exercise one or more of the Bank's
rights set forth herein or seek such other rights or pursue such other remedies
as may be provided by law, in equity or in any other agreement now existing or
hereafter entered into between the Borrower and the Bank, or otherwise.
SECTION 8
BANK PROTECTIONS
8.1 INABILITY TO DETERMINE INTEREST RATE: In the event that prior to
the first day of an Interest Period:
(a) the Bank shall have determined (which determination shall
be conclusive and binding upon the Borrower absent manifest error) that, by
reason of circumstances affecting the relevant market, adequate and reasonable
means do not exist for ascertaining the LIBOR Adjusted Rate for such Interest
Period, or
(b) the Bank shall have determined that the LIBOR Adjusted
Rate determined or to be determined for such Interest Period will not adequately
and fairly reflect the cost to the Bank of making or maintaining its affected
Revolving Credit Loans during such Interest Period,
the Bank shall give prompt telecopy or telephonic notice thereof to the
Borrower. If such notice is given (i) any LIBOR Loans requested to be made on
the first day of such Interest Period shall accrue interest at the Alternate
Base Rate, (ii) Revolving Credit Loans that were to have been converted on the
first day of such Interest Period to LIBOR Loans shall be continued as Alternate
Base Rate Loans and (iii) any outstanding LIBOR Loans shall be converted, on the
first day of such Interest Period, to Revolving Credit Loans accruing interest
at the Alternate Base Rate Loans. Until such notice has been withdrawn by the
Bank, no further LIBOR Loans shall be made or continued as such, nor shall the
Borrower have the right to convert Alternate Base Rate Loans to LIBOR Loans.
8.2 ILLEGALITY: Notwithstanding any other provision herein, if any
change after the date of execution hereof in any requirement of law or in the
interpretation or application thereof shall make it unlawful for the Bank to
make or maintain LIBOR Loans as contemplated by this Agreement, (a) the
commitment of the Bank hereunder to make LIBOR Loans, continue LIBOR Loans as
such and convert Alternate Base Rate Loans to LIBOR Loans shall forthwith be
suspended during such period of illegality and (b) the Revolving Credit Loans
then outstanding as LIBOR Loans, if any, shall be converted automatically to
Alternate Base Rate Loans on the respective last days of the then current
Interest Periods with respect to such Loans or within such earlier period as
required by law. If any such conversion of a LIBOR Loan occurs on a day which is
not the last day of the then current Interest Period with respect thereto, the
Borrower shall pay to the Bank such amounts, if any, as may be required pursuant
to Section 8.5. To the extent that a Lender's LIBOR Loans have been converted to
Alternate Base Rate Loans pursuant to this Section, all payments and prepayments
of principal that otherwise would be applied to such Lender's LIBOR Loans shall
be applied instead to its Alternate Base Rate Loans.
8.3 INCREASED COSTS: (a) In the event that any change after the date
of execution hereof in any requirement of law or in the interpretation or
application thereof or compliance by the Bank with any request or directive
(whether or not having the force of law but, if not having the force of law,
generally applicable to and complied with by banks and financial institutions of
the same general type as the Bank in the relevant jurisdiction) from any central
bank or other governmental authority made subsequent to the date hereof:
(i) shall impose, modify or hold applicable any reserve,
special deposit, compulsory loan or similar requirements against assets
held by, letters of credit or guarantees issued by, deposits or other
liabilities in or for the account of, advances, loans or other
extensions of credit by, or any other acquisition of funds by, any
office of the Bank which is not otherwise included in the determination
of the LIBOR Adjusted Rate hereunder; or
(ii) shall impose on the Bank any other condition;
and the result of any of the foregoing is to increase the cost to the Bank of
issuing or maintaining any Letter of Credit or of making, converting into,
continuing or maintaining LIBOR Loans, or to reduce any amount receivable
hereunder in respect thereof then, in any such case, the Borrower shall
immediately pay to the Bank, upon the demand of the Bank, any additional amounts
necessary to compensate the Bank for such increased cost or reduced amount
receivable. If the Bank becomes entitled to claim any additional amounts
pursuant to this Section, it shall promptly notify the Borrower of the event by
reason of which it has become so entitled. A certificate as to any additional
amounts payable pursuant to this Section submitted by the Bank to the Borrower
shall be conclusive evidence of the accuracy of the information so recorded,
absent manifest error. This covenant shall survive the termination of this
Agreement, expiration of the Letters of Credit and the payment of all other
amounts payable hereunder.
(b) If, after the date of this Agreement, the introduction of
or any change in any applicable law, rule, regulation or guideline regarding
capital adequacy, or any change in the interpretation or administration thereof
by any governmental authority charged with the interpretation or administration
thereof, affects the amount of capital required or expected to be maintained by
the Bank or any corporation controlling the Bank, and the Bank (taking into
consideration the Bank's or such corporation's policies with respect to capital
adequacy) determines that the amount of capital maintained by the Bank or such
corporation which is attributable to or based upon the Revolving Credit Loans,
the Letters of Credit, the Commitment or this Agreement must be increased as a
consequence of such introduction or change by an amount deemed by the Bank to be
material, then, the Bank shall promptly notify the Borrower thereof and, upon
demand of the Bank, the Borrower shall immediately pay to the Bank additional
amounts sufficient to compensate the Bank or such corporation for the increased
costs to the Bank or corporation of such increased capital. Any such demand
shall be accompanied by a certificate of the Bank setting forth in reasonable
detail the computation of any such increased costs, which certificate shall be
conclusive, absent manifest error. This obligation of the Borrower under this
Section shall survive repayment of the Revolving Credit Loans, expiration of the
Letters of Credit and payment of all other amounts hereunder in full and the
termination of this Agreement.
8.4 TAXES: (a) All payments made by the Borrower to the Bank in
respect of the Obligations shall be made free and clear of, and without
deduction or withholding for or on account of, any present or future income,
stamp or other taxes, levies, imposts, duties, charges, fees, deductions or
withholdings, now or hereafter imposed, levied, collected, withheld or assessed
by any governmental authority or any political subdivision or taxing authority
thereof or therein, other than Excluded Taxes (all such non-Excluded Taxes being
hereinafter called "TAXES"). If any Taxes are required to be withheld from any
amounts payable to the Bank in respect of the Obligations, the amounts so
payable to the Bank shall be increased to the extent necessary to yield to the
Bank (after payment of all Taxes) interest or any such other amounts payable
hereunder at the rates or in the amounts specified in this Agreement. The Bank
shall deliver to the Borrower a certificate setting forth the amount of such
Taxes, the calculation of such Taxes and an explanation of the requirement
therefor, all in reasonable detail and such certificate shall be conclusive,
absent manifest error. Whenever any Taxes are payable by the Borrower, as
promptly as possible thereafter, the Borrower shall send to the Bank a copy of
an original official receipt received by the Borrower showing payment thereof or
such other evidence of payment reasonably satisfactory to the Bank. If the
Borrower fails to pay any Taxes when due to the appropriate taxing authority or
fails to remit to the Bank the required receipts or other required documentary
evidence, the Borrower shall indemnify the Bank for any incremental taxes,
interest or penalties (and related reasonable fees and expenses of counsel) that
may become payable by the Bank as a result of any such failure. The agreements
in this Section shall survive the termination of this Agreement, the expiration
of the Letters of Credit and the payment of all other amounts payable hereunder.
(b) The Bank agrees that prior to the date the Borrower makes
any payments under this Agreement it will deliver to the Borrower two duly
completed copies of (i) United States Internal Revenue Service Form 1001 or 4224
or successor applicable form, as the case may be, and (ii) an Internal Revenue
Service Form W-8 or W-9 or successor applicable form. The Bank also agrees to
deliver to the Borrower two further copies of the said Form 1001 or 4224 and
Form W-8 or W-9, or successor applicable forms or other manner or certification,
as the case may be, on or before the date that any such form expires or becomes
obsolete or after the occurrence of any event requiring a change in the most
recent form previously delivered by it to the Borrower, and such extensions or
renewals thereof as may reasonably be requested by the Borrower, unless in any
such case an event beyond the control of the Bank (including, without
limitation, any change in treaty, law or regulation) has occurred prior to the
date on which any such delivery would otherwise be required which renders all
such forms inapplicable or which would prevent the Bank from duly completing and
delivering any such form with respect to it and the Bank so advised the
Borrower. The Bank shall certify (i) in the case of a Form 1001 or 4224, that it
is entitled to receive payments under this Agreement without deduction or
withholding of any United States federal income taxes and (ii) in the case of a
Form W-8 or W-9, that it is entitled to an exemption from U.S. backup
withholding tax.
(c) The Borrower shall not be required to pay any amounts to
the Bank in respect of U.S. withholding tax pursuant to this Section if the
obligation to pay such amounts would not have arisen but for a failure by the
Bank to comply with the requirements of this Section (including the accuracy of
the certificates described in Section 8.04(b)).
8.5 INDEMNITY: The Borrower agrees to indemnify the Bank and to hold
the Bank harmless from and to pay the Bank within 5 days of the Bank's demand
the amount of any liability, loss or expense arising from the reemployment of
funds obtained by it or from fees payable to terminate the deposits from which
such funds were obtained (including reasonable fees and expenses of counsel)
which the Bank may sustain or incur as a consequence of (a) default by the
Borrower in payment when due of the principal amount of or interest on any LIBOR
Loan, (b) default by the Borrower in making a borrowing of, conversion into or
continuation of LIBOR Loans after the Borrower has given a notice requesting the
same in accordance with the provisions of this Agreement, (c) default by the
Borrower in making any prepayment after the Borrower has given a notice thereof
in accordance with the provisions of this Agreement or (d) the making by the
Borrower of a prepayment or conversion of LIBOR Loans on a day which is not the
last day of an Interest Period with respect thereto. The Bank's certificate as
to such liability, loss or expense shall be deemed conclusive, absent manifest
error. This covenant shall survive the termination of this Agreement and the
payment of all other amounts payable hereunder.
8.6 MITIGATION OF COSTS: If the Bank, by changing its applicable
lending office or taking any other reasonable action, can mitigate any adverse
effect on the Borrower under this Section 8, the Bank shall take such action, so
long as making such change or taking such other action is not, in the good faith
judgment of the Bank, disadvantageous to it in any financial, regulatory or
other respect.
SECTION 9
MISCELLANEOUS
9.1 DEFAULT INTEREST RATE: The Borrower shall pay the Bank interest on
any indebtedness or amount payable under this Agreement, from the date that such
indebtedness or amount became due or was demanded to be due until paid in full,
at a rate which is 3% in excess of the applicable interest rate otherwise
provided under this Agreement.
9.2 RELIANCE: Each warranty, representation, covenant, obligation and
agreement contained in this Agreement shall be conclusively presumed to have
been relied upon by the Bank regardless of any investigation made or information
possessed by the Bank and shall be cumulative and in addition to any other
warranties, representations, covenants and agreements which the Borrower now or
hereafter shall give, or cause to be given, to the Bank in writing, other than
those implied hereunder.
9.3 EXPENSES: Reasonable out-of-pocket expenses and attorneys' fees of
the Bank shall be paid by the Borrower in connection with the preparation of
this Agreement. In the event of any action in relation to this Agreement or any
document, instrument or agreement executed with respect to, evidencing or
securing the Obligations, the Borrower shall, in addition to all other sums
which it may owe to Bank, pay all reasonable attorneys' fees incurred by the
Bank.
9.4 NOTICES: All notices, payments, requests, information and demands
which either party hereto may desire, or may be required to give or make to the
other party hereto, shall be given or made to such party by hand delivery,
overnight courier service or through deposit in the United States mail, postage
prepaid, or by telecopier addressed as set forth below or to such other address
as may be specified from time to time in writing by either party to the other
and shall be deemed effective upon receipt.
To the Borrower: To the Bank:
ICN PHARMACEUTICALS, INC. BANQUE NATIONALE DE PARIS
3300 Hyland Avenue Los Angeles Branch
Costa Mesa, CA 92626 725 So. Figueroa Street,
Suite 2090
Los Angeles, CA 90017
Attn: Operational Controller Attn: Tjalling Terpstra
and Director of Cash Vice President
Management
Telecopier No. (714) 668-3145 Telecopier No. (213) 488-9602
9.5 WAIVER: Neither the failure nor delay by the Bank in exercising
any right hereunder or under any document, instrument or agreement mentioned
herein shall operate as a waiver thereof, nor shall any single or partial
exercise of any right hereunder or under any other document, instrument or
agreement mentioned herein preclude other or further exercise thereof or the
exercise of any other right; nor shall any waiver of any right or default
hereunder, or under any other document, instrument or agreement mentioned
herein, constitute a waiver of any other right or default or constitute a waiver
of any other default of the same or any other term or provision.
9.6 CONFLICTING PROVISIONS: To the extent the provisions contained in
this Agreement are inconsistent with those contained in any other document,
instrument or agreement executed pursuant hereto, the terms and provisions
contained herein shall control. Otherwise, such provisions shall be considered
cumulative.
9.7 BINDING EFFECT; ASSIGNMEENT: This Agreement shall be binding upon
and inure to the benefit of the Borrower and the Bank and their respective
successors and assigns, except that the Borrower shall not have the right to
assign its rights hereunder or any interest herein without the prior written
consent of the Bank. The Bank may sell, assign or grant participations in all or
any portion of its rights and benefits hereunder. The Borrower agrees that, in
connection with any such sale, grant or assignment, the Bank may deliver to the
prospective buyer, participant or assignee financial statements and other
relevant information relating to the Borrower if such third party agrees in
writing to abide by the confidentiality provisions of Section 9.12 hereof.
9.8 JURISDICTION: This Agreement, and any documents, instruments or
agreements mentioned or referred to herein shall be governed by and construed
according to the laws of the State of California, to the jurisdiction of whose
courts the parties hereby submit.
9.9 WAIVER OF JURY TRIAL: THE BORROWER AND THE BANK EACH WAIVE THEIR
RESPECTIVE RIGHTS TO A TRIAL BY JURY OF ANY CLAIM OR CAUSE OF ACTION BASED UPON
OR ARISING OUT OF OR RELATED TO THIS AGREEMENT, ANY OTHER LOAN DOCUMENTS, OR THE
TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY, IN ANY ACTION, PROCEEDING OR OTHER
LIGATION OF ANY TYPE BROUGHT BY ANY OF THE PARTIES AGAINST ANY OTHER PARTY OR
PARTIES, WHETHER WITH RESPECT TO CONTRACT CLAIMS, TORT CLAIMS, OR OTHERWISE. THE
BORROWER AND THE BANK EACH AGREE THAT ANY SUCH CLAIM OR CAUSE OF ACTION SHALL BE
TRIED BY A COURT TRIAL WITHOUT A JURY. WITHOUT LIMITING THE FOREGOING, THE
PARTIES FURTHER AGREE THAT THEIR RESPECTIVE RIGHT TO A TRIAL BY JURY IS WAIVED
BY OPERATION OF THIS SECTION AS TO ANY ACTION, COUNTERCLAIM OR OTHER PROCEEDING
WHICH SEEKS, IN WHOLE OR IN PART, TO CHALLENGE THE VALIDITY OR ENFORCEABILITY OF
THIS AGREEMENT OR ANY OTHER LOAN DOCUMENTS OR ANY PROVISION HEREOF OR THEREOF.
THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR
MODIFICATIONS TO THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS.
9.10 HEADINGS: The headings herein set forth are solely for the
purpose of identification and have no legal significance.
9.11 ENTIRE AGREEMENT: This Agreement and all documents, instruments
and agreements mentioned herein constitute the entire and complete understanding
of the parties with respect to the transactions contemplated hereunder. All
previous conversations, memoranda and writings between the parties pertaining to
the transactions contemplated hereunder not incorporated or referenced in this
Agreement or in such documents, instruments and agreements are superseded
hereby.
9.12 CONFIDENTIALITY: The Bank shall take normal and reasonable
precautions to maintain the confidentiality of all non-public information
obtained pursuant to the provisions of this Agreement but may, in any event,
make disclosures (a) reasonably required by any bona fide transferee, assignee
or participant in connection with the contemplated transfer or assignment of any
of the Commitment or Revolving Credit Loans or participations herein or
participations in Letters of Credit or (b) as required or requested by any
governmental agency or representative thereof or as required pursuant to legal
process or (c) to its attorneys and accountants or (d) as required by law or (e)
in connection with litigation involving the Bank; provided that the Bank shall
use its best efforts to notify the Borrower of any requirement or request by any
governmental agency or representative thereof (other than such request in
connection with an examination of the Bank by such governmental agency) and any
requirement pursuant to legal process of or disclosure of such information
(other than in connection with litigation between the Borrower and the Bank) and
further provided that in the case of clauses (a) and (e), the Banks makes each
person aware of the terms of this Section 9.12 and such persons agree to abide
by such terms.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed as of the date first hereinabove written.
BANK: BORROWER:
BANQUE NATIONALE DE PARIS ICN PHARMACEUTICALS, INC.
Los Angeles Branch
By: /s/ C. BEETLES By: /s/ BARBAROS GUVENC
---------------------------- ------------------------------
Name: C. Beetles Name: BARBAROS GUVENC
---------------------------- ------------------------------
Title: Sr. V.P. & Manager Title: TREASURER
---------------------------- ------------------------------
By: /s/ TJALLING TERPSTRA
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Name: TJALLING TERPSTRA
-------------------------
Title: VICE PRESIDENT
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