0000950124-95-002392.txt : 19950810
0000950124-95-002392.hdr.sgml : 19950810
ACCESSION NUMBER: 0000950124-95-002392
CONFORMED SUBMISSION TYPE: 8-K
PUBLIC DOCUMENT COUNT: 7
CONFORMED PERIOD OF REPORT: 19950727
ITEM INFORMATION: Acquisition or disposition of assets
ITEM INFORMATION: Financial statements and exhibits
FILED AS OF DATE: 19950809
SROS: NASD
FILER:
COMPANY DATA:
COMPANY CONFORMED NAME: WALBRO CORP
CENTRAL INDEX KEY: 0000104174
STANDARD INDUSTRIAL CLASSIFICATION: MOTOR VEHICLE PARTS & ACCESSORIES [3714]
IRS NUMBER: 381358966
STATE OF INCORPORATION: DE
FISCAL YEAR END: 1231
FILING VALUES:
FORM TYPE: 8-K
SEC ACT: 1934 Act
SEC FILE NUMBER: 000-06955
FILM NUMBER: 95560037
BUSINESS ADDRESS:
STREET 1: 6242 GARFIELD ST
CITY: CASS CITY
STATE: MI
ZIP: 48726
BUSINESS PHONE: 5178722131
MAIL ADDRESS:
STREET 1: 6432 GARFIELD ST
CITY: CASS CITY
STATE: MI
ZIP: 48726
8-K
1
FORM 8-K
1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
The Securities Exchange Act of 1934
Date of Report (Date of Earliest Event Reported): July 27, 1995
Walbro Corporation
(Exact Name of Registrant as Specified in Charter)
Delaware 0-6955 38-1358966
(State or Other Jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
6242 Garfield Street, Cass City, Michigan 48726
(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code (517) 872-2131
2
ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS.
(a) On July 27, 1995, Walbro Corporation ("Walbro"), through certain of its
wholly-owned subsidiaries, acquired the Fuel Systems business of Dyno
Industrier A.S, a Norwegian corporation ("Dyno") (the "Acquisition").
The net purchase price for the Acquisition was approximately $124 million
(approximately $138 million less approximately $14 million in cash
acquired by Walbro), exclusive of expenses of the transaction. The
purchase price is subject to certain post-closing adjustments. The
purchase price was arrived at through arms'-length negotiations between
Walbro and Dyno. Prior to this transaction, there was no material
relationship between (i) Dyno or its shareholders and (ii) Walbro or any
of its affiliates, any director or officer of Walbro, or any associate
of any such director or officer. The Fuel Systems business of Dyno
acquired by Walbro is in the business of designing, manufacturing and
marketing plastic fuel tank systems and components to European vehicle
manufacturers, with operations in six countries.
Of the approximate $138 million purchase price, approximately $107
million was supplied by the offering of institutionally placed unsecured
senior notes due 2005. The remaining approximate $31 million was
provided by a Credit Facility (the "Credit Facility") with Comerica Bank,
as agent, and certain other lenders. The Credit Facility consists of a
$135 million multicurrency revolving loan facility for Walbro and certain
of its wholly-owned domestic and foreign subsidiaries. Borrowings under
the Credit Facility will bear interest at a per annum rate equal to the
agent's base rate or the prevailing interbank offered rate in the
applicable offshore currency market, plus an additional margin ranging
from 0.5% to 1.75% based on certain financial ratios of Walbro.
(b) Certain of the assets acquired pursuant to this transaction constitute
plant, equipment or other physical property used by Dyno in its business
as a designer, manufacturer and marketer of plastic fuel tank systems and
components. Walbro intends to continue such use.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
(a) Financial Statements of Business Acquired.
The following Financial Statements of the Fuel Systems Division of Dyno
are included on Pages F-1 through F-23:
As of December 31, 1994 and 1993 and for the years ended December 31,
1994 and 1993
Report of Independent Public Accountants . . . . . . . . . . . . . . . . . F-1
Combined Balance Sheets . . . . . . . . . . . . . . . . . . . . . . . . . F-3
Combined Income StatemenTs . . . . . . . . . . . . . . . . . . . . . . . . F-4
Combined Statements of Cash Flows . . . . . . . . . . . . . . . . . . . . F-5
Notes to the Combined Financial Statements . . . . . . . . . . . . . . . . F-6
- 1 -
3
For the year ended December 31, 1992
Report of Independent Public Accountants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F-16
Combined Statement of Revenues and Direct Costs and Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . F-17
Notes to the Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F-18
As of March 31, 1995 and for the three months ended March 31, 1995 and 1994
Unaudited Combined Balance Sheets as of March 31, 1995 and 1994 . . . . . . . . . . . . . . . . . . . . . . . . . F-20
Combined Income Statements (Unaudited) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F-21
Combined Statements of Cash Flows (Unaudited) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F-22
Notes to the Combined Financial Statements (Unaudited) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F-23
(b) Pro Forma Financial Information.
The following Pro Forma Unaudited Condensed Consolidated Financial
Information is included in pages P-1 through P-3 of this Form 8-K:
Pro Forma Unaudited Condensed Consolidated Statement of Operations
for the three months ended March 31, 1995 and the year ended
December 31, 1994. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . P-1
Notes to Pro Forma Unaudited Condensed Consolidated Statements of Operations . . . . . . . . . . . . . . . . . . P-2
Pro Forma Unaudited Condensed Consolidated Balance Sheet as of
March 31, 1995 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . P-3
Notes to Pro Forma Unaudited Condensed Consolidated Balance Sheet . . . . . . . . . . . . . . . . . . . . . . . . P-3
(c) Exhibits.
2.1 Purchase and Sale Agreement ("Dyno Agreement") by and between Walbro Corporation and Dyno Industrier A.S, dated as
of April 7, 1995, incorporated by reference to Exhibit 2.1 to Walbro's Quarterly Report on Form 10-Q for the quarter
ended March 31, 1995.
2.2 Addendum to Dyno Agreement by and between Walbro Corporation and Dyno Industrier A.S, dated as of July 27, 1995.
2.3 Indenture dated as of July 27, 1995 among Walbro Corporation, Walbro Automotive Corporation, Walbro Engine
Management Corporation, Sharon Manufacturing Company, Whitehead Engineered Products, Inc. and Bankers Trust
Company.
2.4 Walbro Corporation $135,000,000 Credit Agreement dated as of July 26, 1995, with Comerica Bank, as agent.
23.1 Consent of Arthur Andersen & Co. GmbH
23.2 Consent of Arthur Andersen & Co. GmbH
23.3 Consent of Deloitte & Touche
- 2 -
4
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Walbro Corporation
/s/ L. E. Althaver
By: ------------------------------------
Dated: August 9, 1995 L. E. Althaver
Chairman, President and Chief
Executive Officer
- 3 -
5
PRO FORMA UNAUDITED CONDENSED CONSOLIDATED FINANCIAL DATA
The following Pro Forma Unaudited Condensed Consolidated Statements of
Operations for the three months ended March 31, 1995 and the year ended
December 31, 1994 present pro forma operating results as if the Transactions
had occurred as of January 1, 1994. The Pro Forma Unaudited Condensed
Consolidated Balance Sheet as of March 31, 1995 gives effect to the
Transactions as if they had occurred on that date. The pro forma adjustments
are described in the notes thereto. The Pro Forma Unaudited Condensed
Consolidated Financial Data should be read in conjunction with the Company's
and Dyno's historical financial statements and related notes thereto. The Pro
Forma Unaudited Condensed Consolidated Financial Data do not purport to
represent either future results or the results that would have occurred if the
Transactions had occurred on the dates indicated, nor do they give effect to
any matters other than those described in the notes thereto.
PRO FORMA UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
THREE MONTHS ENDED MARCH 31, 1995
---------------------------------------------------------
COMPANY DYNO
HISTORICAL HISTORICAL(1) ADJUSTMENTS PRO FORMA
---------- ------------- ----------- ---------
(UNAUDITED DOLLARS IN THOUSANDS, EXCEPT SHARE DATA)
Net sales.................................... $ 98,257 $53,339 $-- $ 151,596
Cost of sales................................ 77,550 41,823 (196)(2) 119,177
---------- ---------- --------- ---------
Gross margin................................. 20,707 11,516 196 32,419
Selling and administrative expenses.......... 12,661 8,190 -- 20,851
---------- ---------- --------- ---------
Operating income............................. 8,046 3,326 196 11,568
Interest expense, net........................ 1,089 509 2,966(3) 4,564
Other expense, net........................... 321 202 -- 523
---------- ---------- --------- ---------
Income before taxes and other................ 6,636 2,615 (2,770) 6,481
Provision for income taxes................... 2,554 795 (1,082)(5) 2,267
Equity in (income) loss of joint ventures.... (1,006) -- -- (1,006)
---------- ---------- --------- ---------
Net income................................... $ 5,088 $ 1,820 $(1,688) $ 5,220
======== ========== ========= =========
Net income per share......................... $.59 $.61
Weighted average shares outstanding.......... 8,597,265 8,597,265
EBITDA(6).................................... $ 11,690 $ 5,983 -- $ 17,673
Ratio of EBITDA to interest expense, net..... 10.7x 3.9x
YEAR ENDED DECEMBER 31, 1994
-------------------------------------------------------
COMPANY DYNO
HISTORICAL HISTORICAL(1) ADJUSTMENTS PRO FORMA
---------- ------------- ----------- ---------
(UNAUDITED DOLLARS IN THOUSANDS, EXCEPT SHARE DATA)
Net sales..................................... $ 325,205 $ 147,147 $ -- $ 472,352
Cost of sales................................. 261,501 112,514 916(2) 374,931
---------- ------------- ----------- ---------
Gross margin.................................. 63,704 34,633 (916) 97,421
Selling and administrative expenses........... 39,318 29,541 (950)(4) 67,909
---------- ------------- ----------- ---------
Operating income.............................. 24,386 5,092 34 29,512
Interest expense, net......................... 3,771 2,792 10,754(3) 17,317
Other expense, net............................ 2,713 984 -- 3,697
---------- ------------- ----------- ---------
Income before taxes and other................. 17,902 1,316 (10,720) 8,498
Provision for income taxes.................... 5,824 2,329 (3,435)(5) 4,718
Minority interest............................. 92 -- -- 92
Equity in (income) loss of joint ventures..... (2,609) -- -- (2,609)
---------- ------------- ----------- ---------
Income (loss) before extraordinary item....... 14,595 (1,013) (7,285) 6,297
---------- ------------- ----------- ---------
Extraordinary item--gain on forgiveness
of debt..................................... -- 4,691 (4,691) --
---------- ------------- ----------- ---------
Net income.................................... $ 14,595 $ 3,678 $ (11,976) $ 6,297
======== ========== ========= ========
Net income per share.......................... $1.70 $.73
Weighted average shares outstanding........... 8,602,077 8,602,077
EBITDA(6)..................................... $ 36,345 $ 14,020 $ 950 $ 51,315
Ratio of EBITDA to interest expense, net...... 9.6x 3.0x
P-1
6
NOTES TO PRO FORMA UNAUDITED CONDENSED CONSOLIDATED STATEMENTS
OF OPERATIONS
(1) The Dyno historical information represents amounts derived from the
unaudited combined financial statements of Dyno for the three months ended
March 31, 1995 and the audited combined financial statements of Dyno for the
year ended December 31, 1994, included elsewhere in this Offering
Memorandum, translated from Norwegian Kroner ("NOK") to U.S. Dollars at the
average exchange rates of 6.54 NOK and 7.05 NOK to one U.S. Dollar for the
three months ended March 31, 1995 and the year ended December 31, 1994,
respectively.
(2) Adjustments consist of pro forma adjustments to the historical expenses of
Dyno to reflect estimated adjustments to depreciation and amortization
expense resulting from the revaluation of Dyno net assets acquired. The
adjustments include the following items:
THREE MONTHS ENDED YEAR ENDED
MARCH 31, 1995 DECEMBER 31, 1994
------------------ -----------------
Depreciation and amortization expense on revalued
assets............................................... $ 2,461 $ 9,844
Eliminate historical depreciation and amortization
expense on assets.................................... (2,657) (8,928)
-------- -------
$ (196) $ 916
======== =======
(3) Reflects interest expense changes resulting from new indebtedness incurred
in conjunction with the Transactions. Amortization of deferred financing
fees was calculated based on a ten year amortization period for fees related
to the Notes and a five year amortization period for fees related to the New
Credit Facility. In addition, the remaining balance of deferred financing
fees on the existing credit agreement is assumed to be written off. In
connection with the Dyno Acquisition, certain liabilities are not being
assumed by the Company, consisting principally of certain borrowings of
long-term debt, amounts payable to related entities, certain notes payable
and subordinated loans. As such, interest expense incurred on these
borrowings not being assumed has been eliminated in the pro forma
presentation.
THREE MONTHS ENDED YEAR ENDED
MARCH 31, 1995 DECEMBER 31, 1994
------------------ -----------------
Interest expense on the Notes, at 9 7/8%, including
amortization of original issue discount of $10 and
$39, respectively.................................... $2,725 $10,901
Estimated interest on New Credit Facility borrowings... 885 4,081
Elimination of interest expense on certain credit
facilities........................................... (111) (1,629)
Elimination of interest expense on Dyno borrowings not
assumed.............................................. (659) (3,104)
Fee amortization on Notes.............................. 109 436
Fee amortization on New Credit Facility................ 32 129
Write-off of unamortized deferred financing fees....... (15) (60)
------ -------
$2,966 $10,754
====== =======
P-2
7
(4) Reflects the elimination of a $950 charge recorded in 1994 related to a
litigation claim against Dyno Industrier A.S in France which is still
pending. In accordance with the agreement to acquire Dyno, Dyno Industrier
A.S will retain all obligations related to this claim.
(5) Reflects estimated income tax adjustments resulting from the pro forma
adjustments as follows:
THREE MONTHS ENDED YEAR ENDED
MARCH 31, 1995 DECEMBER 31, 1994
------------------ -----------------
Income tax effects of adjustments in Notes 2 and 4
above at Dyno's estimated effective income tax rate
of 30.4% and 177.1%, respectively.................... $ 60 $ 60
Income tax effects of adjustments in Note 3 above at
the Company's estimated effective income tax rate of
38.5% and 32.5%, respectively........................ (1,142) (3,495)
-------- -------
$ (1,082) $(3,435)
======== =======
(6) "EBITDA" represents, for any period, the sum of operating income (minus
foreign currency exchange losses and other expenses, net) and depreciation
and amortization. EBITDA is not intended to be a performance measure that
should be regarded as an alternative either to operating income or net
income as an indicator of operating performance or to cash flow as a measure
of liquidity. The Company has included information concerning EBITDA as it
understands that it is used by certain investors as one measure of an
issuer's historical ability to service its debt.
P-3
8
PRO FORMA UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEET
AS OF MARCH 31, 1995
----------------------------------------------------------------
COMPANY DYNO
HISTORICAL HISTORICAL(1) ADJUSTMENTS PRO FORMA
---------- ------------- -------------- ---------
(UNAUDITED DOLLARS IN THOUSANDS)
ASSETS
Cash..................................... $ 3,188 $ 6,299 $-- $ 9,487
Accounts receivable, net................. 71,591 41,037 -- 112,628
Inventories.............................. 34,180 14,664 -- 48,844
Other current assets..................... 8,523 9,975 -- 18,498
--------- --------- -------- ---------
Total current assets................ 117,482 71,975 -- 189,457
--------- --------- -------- ---------
Property, plant and equipment............ 155,682 106,277 (13,342) (2) 248,617
Accumulated depreciation................. (54,197) (44,694) 44,694 (2) (54,197)
--------- --------- -------- ---------
Net property, plant and equipment........ 101,485 61,583 31,352 194,420
--------- --------- -------- ---------
Goodwill................................. 19,134 1,574 11,750 (2) 32,458
Other assets............................. 43,079 4,753 2,093 (3)(4) 49,925
--------- --------- -------- ---------
Total other assets.................. 62,213 6,327 13,843 82,383
--------- --------- -------- ---------
Total assets...................... $ 281,180 $ 139,885 $ 45,195 $ 466,260
========= ========= ======== =========
LIABILITIES AND STOCKHOLDERS' EQUITY
Short-term debt.......................... $ 15,973 $ 20,451 $(15,381) (4) $ 21,043
Other current liabilities................ 44,478 45,437 (4,844) (4) 85,071
---------- --------- -------- ---------
Total current liabilities........... 60,451 65,888 (20,225) 106,114
---------- --------- -------- ---------
Total long-term debt, less current
portion................................ 74,352 18,048 117,349 (4)(5) 209,749
Other long-term liabilities.............. 12,932 8,299 (4,224) (4)(6) 17,007
---------- --------- -------- ---------
Total long-term liabilities......... 87,284 26,347 113,125 226,756
---------- --------- -------- ---------
Total stockholders' equity............... 133,445 47,650 (47,705) (2)(3) 133,390
---------- --------- -------- ---------
Total liabilities and stockholders'
equity............................ $ 281,180 $ 139,885 $ 45,195 $ 466,260
======== ========= ======== =========
NOTES TO PRO FORMA UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEET
(1) The Dyno historical information represents amounts derived from the
unaudited combined financial statements of Dyno for the three months ended
March 31, 1995, included elsewhere in this Offering Memorandum, translated
from NOK to U.S. Dollars at the March 31, 1995 exchange rate of 6.29 NOK to
one U.S. Dollar.
(2) The purchase price of $130,000 in cash includes provisions for estimated
closing adjustments and fees and expenses estimated at $6,000. The Dyno
Acquisition will be accounted for using the purchase method of accounting
and the total purchase cost will be allocated first to assets and
liabilities based upon their respective fair market values, with the
remainder allocated to goodwill. Historical Dyno equity balances are
eliminated for purposes of the pro forma consolidated balance sheet. The
allocation of the purchase price reflected above is based on estimates and
may differ from the final allocation.
(3) Reflects fees of $5,000 related to the Offering and the New Credit Facility,
net of the write-off of unamortized fees of $55 on the retirement of
borrowings under certain credit facilities.
(4) The assets acquired and liabilities assumed by the Company in the Dyno
Acquisition excluded certain long-term assets, a portion of long-term debt
(both current and non-current portions), amounts payable to related
entities, income taxes payable, deferred income taxes and certain long-term
liabilities.
(5) Reflects the effects of the Transactions as follows:
Issuance of the Notes......................................................... $109,615
Borrowings under the New Credit Facility...................................... 32,785
Retirement of the borrowings outstanding under certain credit facilities...... (7,400)
--------
Net increase in long-term debt................................................ $135,000
========
(6) Reflects the recognition of deferred income taxes on the write-up of
property, plant and equipment computed at the statutory tax rate in effect
in each country where the stock is being acquired as follows: Belgium --
40%, France -- 33% and Spain -- 35%.
P-4
9
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
To the Board of Directors of Dyno Industrier A.S
Oslo, Norway:
We have audited the accompanying combined balance sheet of the Fuel Tank
System Division (the "Division") of Dyno Industrier A.S ("Dyno") as of December
31, 1994, and the related combined statements of income, stockholders' and
divisional equity, and cash flows for the year then ended. These financial
statements are the responsibility of the Division and Dyno's management. Our
responsibility is to express an opinion on these combined financial statements
based on our audit.
We conducted our audit in accordance with auditing standards generally
accepted in the United States. Those standards require that we plan and perform
the audit to obtain reasonable assurance about whether the financial statements
are free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements. An
audit also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audit provides a reasonable basis
for our opinion.
In our opinion, such 1994 financial statements present fairly, in all
material respects, the combined financial position of the Division as of
December 31, 1994, and the combined results of operations and its combined cash
flows for the year then ended in conformity with accounting principles generally
accepted in the United States.
ARTHUR ANDERSEN & CO. GmbH
Stuttgart, Germany
May 12, 1995
F-1
10
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
To The Board of Directors of Dyno Industrier A.S:
We have audited the accompanying combined balance sheet of the Fuel Tank
System Division of Dyno Industrier A.S (the "Division") as of December 31, 1993,
and the related combined statements of income, and cash flow for the year then
ended. These combined financial statements are the responsibility of the
Division's management. Our responsibility is to express an opinion on these
combined financial statements based on our audit.
We conducted our audit in accordance with auditing standards generally
accepted in the United States. Those standards require that we plan and perform
the audit to obtain reasonable assurance about whether the financial statements
are free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements. An
audit also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audit provides a reasonable basis
for our opinion.
In our opinion, such 1993 combined financial statements present fairly, in
all material respects, the combined financial position of the Division as of
December 31, 1993, and the combined results of operations and its combined cash
flows for the year then ended in conformity with accounting principles generally
accepted in the United States.
DELOITTE & TOUCHE
Oslo, Norway
May 12, 1995
F-2
11
DYNO INDUSTRIER A.S FUEL TANK SYSTEM DIVISION
COMBINED BALANCE SHEETS
AS OF DECEMBER 31, 1994 AND 1993
1994 1993
------- -------
(AMOUNTS IN NOK
1,000)
ASSETS
Current Assets:
Cash and cash equivalents -- (Note 1)................................ 24,136 25,285
Notes receivable -- (Note 4)......................................... 32,622 34,384
Accounts receivable (less allowance for doubtful accounts of 1,612
and 3,591 in 1994 and 1993 respectively) -- (Note 4).............. 181,792 116,863
Amounts receivable from related entities -- (Note 11)................ 28,980 2,591
Inventories: -- (Note 1)
Raw materials........................................................ 37,036 31,337
Work in progress..................................................... 22,005 36,374
Finished goods....................................................... 26,569 19,494
------- -------
Total Inventories............................................ 85,610 87,205
------- -------
Prepaid expenses and other current assets............................ 43,532 43,838
------- -------
Total Current Assets......................................... 396,672 310,166
======= =======
Property, Plant and Equipment -- Net -- (Note 1 and 5)................. 396,665 420,601
Other Assets:
Long term receivables................................................ 16,602 33,278
Intangible assets -- Net -- (Note 6)................................. 14,801 13,338
Deferred taxes -- (Notes 1 and 3).................................... 11,130 12,793
Other................................................................ 3,605 3,738
------- -------
Total Other Assets........................................... 46,138 63,147
------- -------
Total Assets................................................. 839,475 793,914
======= =======
LIABILITIES AND SHAREHOLDERS' AND DIVISIONAL EQUITY:
Current Liabilities:
Bank overdraft....................................................... -- 3,826
Accounts payable..................................................... 147,465 108,826
Accrued liabilities -- (Note 12)..................................... 79,919 124,043
Current portion of long term debt -- (Note 7)........................ 102,388 32,679
Amounts payable to related entities -- (Note 11)..................... 36,788 108,570
Notes payable........................................................ 30,792 26,390
Income Taxes payable................................................. 1,596 246
------- -------
Total Current Liabilities.................................... 398,948 404,580
======= =======
Deferred Revenue....................................................... 9,876 4,842
Accrued Pension Liabilities -- (Notes 1 and 9)......................... 10,655 9,488
Deferred Taxes -- (Notes 1 and 3)...................................... 22,777 16,469
Long Term Debt -- Less current portion -- (Note 7)..................... 100,050 156,258
Subordinated Loan -- (Note 7).......................................... 9,511 124,890
Commitments and Contingencies -- (Note 12)
Shareholders' and Divisional Equity -- (Note 10)....................... 287,658 77,387
------- -------
Total Liabilities and Shareholders' and Divisional Equity.... 839,475 793,914
======= =======
F-3
12
DYNO INDUSTRIER A.S FUEL TANK SYSTEM DIVISION
COMBINED INCOME STATEMENTS
FOR THE YEARS ENDED DECEMBER 31, 1994 AND 1993
1994 1993
--------- -------
(AMOUNTS IN NOK
1,000)
Revenues -- (Note 2)................................................... 1,037,571 617,955
Cost of Goods Sold..................................................... 793,364 485,030
--------- -------
Gross Profit........................................................... 244,207 132,925
--------- -------
Selling, General, and Administrative Expenses -- (Notes 1, 8, 9, and
11).................................................................. 208,303 170,590
--------- -------
Operating Income (Loss)................................................ 35,904 (37,665)
--------- -------
Other Income (Expense):
Interest expense..................................................... (25,446) (19,052)
Interest income...................................................... 5,757 1,213
Other expense -- net................................................. (6,940) 1,106
--------- -------
Total other income (expense)................................. (26,629) (16,733)
--------- -------
Income (Loss) Before Taxes and Extraordinary Item...................... 9,275 (54,398)
--------- -------
Income Taxes -- (Note 3)............................................... 16,421 349
--------- -------
Loss Before Extraordinary Item......................................... (7,146) (54,747)
--------- -------
Extraordinary Item -- Gain on forgiveness on debt -- (Note 7).......... 33,078 --
--------- -------
Net income (loss)............................................ 25,932 (54,747)
======== =======
F-4
13
DYNO INDUSTRIER A.S FUEL TANK SYSTEM DIVISION
COMBINED STATEMENTS OF CASH FLOWS
FOR THE YEARS ENDED DECEMBER 31, 1994 AND 1993
1994 1993
-------- --------
(AMOUNTS IN NOK
1,000)
Cash Flows From Operating Activities:
Net income (loss).................................................... 25,932 (54,747)
Adjustments to reconcile net income to net cash provided by operating
activities:
Depreciation and amortization................................... 62,956 45,110
Change in deferred income taxes................................. 7,971 (1,424)
Gain on sale of property, plant and equipment................... (1,899) (2,039)
Gain on forgiveness of debt..................................... (33,078) --
Changes in operating assets and liabilities
(Increase) decrease:
Accounts and notes receivable................................ (63,167) (31,791)
Inventories.................................................. 1,595 (8,437)
Prepaid expenses and other current assets.................... 306 (17,987)
Long-term receivables and other assets....................... 15,346 (29,323)
Increase (decrease):
Accounts payable............................................. 38,639 17,729
Accrued and other liabilities................................ (45,433) 71,355
Deferred revenue............................................. 5,034 4,492
-------- --------
Net cash provided by operating activities....................... 14,202 (7,062)
======== ========
Cash Flows From Investing Activities:
Purchases of property, plant and equipment........................... (61,376) (182,061)
Proceeds from sale of property, plant and equipment.................. 25,523 28,932
(Advances to) repayments from related entities -- net................ (98,171) 54,157
-------- --------
Net cash used in investing activities................................ (134,024) (98,972)
-------- --------
Cash Flows From Financing Activities:
Borrowings of long-term debt......................................... 43,145 37,220
Repayments of long-term debt......................................... (5,434) (1,097)
Net repayment of related party long-term debt........................ (19,808) (18,334)
Borrowings of subordinated loans..................................... -- 42,612
Repayments of subordinated loans..................................... (82,301) --
Contributed equity................................................... 185,656 65,560
-------- --------
Net cash provided by financing activities.............................. 121,258 125,961
-------- --------
Foreign currency effects on cash flows................................. (2,585) 2,640
Net increase (decrease) in cash and cash equivalents................... (1,149) 22,567
-------- --------
Cash and cash equivalents at beginning of year......................... 25,285 2,718
-------- --------
Cash and cash equivalents at end of year............................... 24,136 25,285
======== ========
Supplemental disclosure of cash flow information:
Cash paid for interest............................................... 24,150 27,722
Income taxes deemed to be paid....................................... 7,100 1,527
F-5
14
DYNO INDUSTRIER A.S FUEL TANK SYSTEM DIVISION
NOTES TO THE COMBINED FINANCIAL STATEMENTS
AS OF AND FOR THE YEARS ENDED 31 DECEMBER 1994 AND 1993
1 ACCOUNTING POLICIES
Principles of Combination
The combined historical financial statements include the accounts of the
Fuel Tank System Division (the Division) of Dyno Industrier A.S (Dyno), a
Norwegian company. This division comprises production units in Norway, Great
Britain, Germany, France, Belgium, and Spain which are involved in the
development and manufacture of plastic automotive fuel tank systems. All
significant accounts and transactions between the division's units have been
eliminated in combination.
The financial statements of the Division's operating units have been
combined and prepared as a result of the Purchase and Sale Agreement between
Dyno and Walbro Corporation dated April 7, 1995. Walbro Corporation is
purchasing certain divisional assets of the entities in Norway, Great Britain,
Germany and Belgium, and the shares of the entities in France and Spain. The
combined financial statements have been prepared in accordance with accounting
principles generally accepted in the United States.
During the periods covered by the combined income statement the Division's
business was conducted as an integral part of Dyno's overall operations. The
financial statements include sales to and purchases of materials to and from
other Dyno business units at established prices. These amounts are not
necessarily indicative of the costs that will prevail for the Division
subsequent to the closing of the transaction described in the purchase
agreement. The financial statements also include various allocated costs and
expenses (see Note 8) which are not necessarily indicative of the costs and
expenses which would have resulted had the Division been operated as a separate
company. All of the allocations and estimates reflected in the financial
statements are based on assumptions that the production units' and Dyno's
management believes are reasonable.
In preparing the combined accounts, the results are translated into
Norwegian kroner (NOK) at annual average rates of exchange. The combined balance
sheet is translated at year-end rates of exchange. The effects of exchange rate
changes during the year on net assets are included in Divisional equity.
Cash and cash equivalents
Cash and cash equivalents include cash, bank deposits and all other
monetary instruments with a maturity of less than three months at the date of
purchase.
Financial instruments
The Division's activities in derivative financial instruments are not
significant and generally consist of agreements with Dyno and its affiliates to
manage foreign currency and interest rate exposure. The estimated fair values of
Dyno's financial instruments approximate the carrying values.
Discounts/premiums on foreign exchange contracts and cost/income on other
hedging contracts (interest rate swaps, interest rate caps, etc.) have been
recognized as other income or expense over the life of the contracts.
Inventories
Inventories are valued at the lower of cost using the 'first-in-first-out'
method or at net realizable value. Cost for goods purchased is the purchase
price. Cost for goods in production and internally produced goods is the direct
manufacturing cost plus the appropriate portion of production overhead costs.
F-6
15
DYNO INDUSTRIER A.S FUEL TANK SYSTEM DIVISION
NOTES TO THE COMBINED FINANCIAL STATEMENTS -- (CONTINUED)
Property, Plant and Equipment
Property, plant and equipment are carried on the balance sheet at original
cost, less straight-line depreciation. The rates for calculating straight-line
depreciation have been determined based on an evaluation of the individual fixed
asset's economic lifetime as follows:
machinery and equipment................................ 3 - 20 years
buildings.............................................. 20 - 33 years
Intangible Assets
Intangible assets include organization costs and goodwill, and are
amortized on a straight-line basis over five to twenty years.
Research and Development
Research and development costs are expensed as they are incurred.
Pensions and Pension Liabilities
Pension costs are calculated in accordance with the Statement of Financial
Accounting Standards No. 87. Pension liabilities (directly financed and funded
plans) have been valued at the present value of future pension payments as of
December 31, 1994. Future pension payments are calculated on the basis of the
expected salary at the time of retirement. Pension plan assets are valued at
market value on December 31, 1994. Net pension liabilities (pension liabilities
less pension plan assets) are accounted for as long term obligations after
correction for net actuarial differences.
Income Taxes
The Division has been included in Dyno's consolidated income tax returns in
the various countries. The recorded provision for income taxes approximates the
tax effect which would have been recorded had the Division operated on a
stand-alone basis.
Deferred income tax expense has been calculated using the liability method
in accordance with Statement of Financial Accounting Standards No. 109. Under
this method, deferred tax assets and liabilities are measured based upon
"temporary differences" which are differences between the carrying values of
assets and liabilities for financial reporting and their tax basis. Deferred
income tax expense is the change during the year in the deferred tax assets and
liabilities.
Deferred Revenues
Deferred revenues consist of investment grants from governments and certain
subsidies received from customers. Grants are recognized as income when
conditions for receipt are met, and subsidies are recognized as an offset to
cost of goods sold over the term of the agreement.
F-7
16
DYNO INDUSTRIER A.S FUEL TANK SYSTEM DIVISION
NOTES TO THE COMBINED FINANCIAL STATEMENTS -- (CONTINUED)
2 REVENUES BY COUNTRY OF CUSTOMER
1994 1993
--------- -------
NOK 1,000
Europe:
United Kingdom....................................... 88,466 68,208
Netherlands.......................................... 5,575 4,679
Germany.............................................. 343,161 167,691
France............................................... 211,873 213,136
Belgium.............................................. 151,066 23,204
Spain................................................ 51,551 7
Finland.............................................. 301 3,889
Sweden............................................... 144,727 111,100
Other EU countries................................... -- 766
--------- -------
Total EU..................................... 996,720 592,680
Norway................................................. 8,083 6,109
Rest of Europe......................................... 18,730 16,460
--------- -------
Total Europe................................. 1,023,533 615,249
Outside Europe:
North America........................................ 115 1
Africa............................................... -- 310
Asia................................................. 13,923 2,395
--------- -------
TOTAL........................................ 1,037,571 617,955
========= =======
3 TAXES
The provision for income taxes included in the combined statements of
income consist of the following (in NOK 1,000):
1994 1993
------ ------
Current taxes............................................. 8,450 1,773
Deferred taxes............................................ 7,971 (1,424)
------ ------
Provision for income tax.................................. 16,421 349
====== ======
A reconciliation between income taxes at the statutory rates in Norway (28%
for 1994 and 1993) and the provision for income taxes for the years ended 1994
and 1993 is as follows (in NOK 1,000):
1994 1993
------ -------
Income tax provison (benefit) at Norwegian statutory
rate.................................................... 2,597 (15,231)
International rate differences............................ 2,870 --
Losses for which no tax benefit was provided.............. 8,282 15,478
Utilization of loss carry forwards........................ (3,004) --
Other..................................................... 5,676 102
------ -------
Provision for income tax.................................. 16,421 349
====== =======
F-8
17
DYNO INDUSTRIER A.S FUEL TANK SYSTEM DIVISION
NOTES TO THE COMBINED FINANCIAL STATEMENTS -- (CONTINUED)
Significant components of deferred tax balances as of December 31 are as
follows:
1994 1993
------- -------
NOK 1,000
Deferred tax assets:
Accrued costs of pension plans......................... 1,493 1,243
Net operating loss carry forwards...................... 33,448 44,706
Other.................................................. 1,498 408
------- -------
Total deferred tax assets................................ 36,439 46,357
Valuation allowance...................................... (25,309) (33,564)
------- -------
Net deferred tax assets.................................. 11,130 12,793
------- -------
Deferred tax liabilities
Property, plant and equipment.......................... 22,548 16,303
Other.................................................. 229 166
------- -------
Total Deferred tax liabilities........................... 22,777 16,469
======= =======
The valuation allowance is provided when it is more likely than not that
some portion of the deferred tax assets will not be realized. The Division has
established a valuation allowance for certain net operating loss carryforwards.
At the end of 1994, total deductible losses carried forward in Dynoplast
S.A France and Dynoplast S.A Spain (the entities where stock is being acquired)
amounted to NOK 90.4 million. Losses carried forward expire as follows (in NOK
1,000):
1997................................................................ 18,185
1998................................................................ 28,948
1999................................................................ 11,986
Without expiration.................................................. 31,271
-------
TOTAL..................................................... 90,390
======
4 GEOGRAPHIC AND CREDIT RISK
Accounts receivable by geographical area as of December 31, are:
1994 1993
-------- --------
NOK 1,000
Norway................................................. 3,026 --
The EU................................................. 178,887 119,718
Rest of Europe......................................... 284 58
------- -------
Total Europe...................................... 182,197 119,776
North America.......................................... 96 3
Asia................................................... 1,111 675
------- -------
TOTAL GROSS ACCOUNTS RECEIVABLE........................ 183,404 120,454
Less allowance for doubtful accounts................... 1,612 3,591
------- -------
TOTAL NET ACCOUNTS RECEIVABLE..................... 181,792 116,863
======= =======
In addition the French and Spanish entities had notes receivables of (NOK
1,000) 32,449 and 173 in 1994 and 34,377 and 7 in 1993, respectively. These
notes are created in the normal course of business in these countries and are
generally collected under similar terms to accounts receivable.
F-9
18
DYNO INDUSTRIER A.S FUEL TANK SYSTEM DIVISION
NOTES TO THE COMBINED FINANCIAL STATEMENTS -- (CONTINUED)
5 PROPERTY, PLANT AND EQUIPMENT
Property, plant and equipment consist of the following at December 31:
1994 1993
------- -------
NOK 1,000
Land.................................................... 12,012 14,067
Assets under construction............................... 23,337 35,354
Buildings............................................... 62,257 41,045
Machinery and equipment................................. 534,229 531,103
------- -------
Total.............................................. 631,835 621,569
Less accumulated depreciation...................... 235,170 200,968
------- -------
Property, plant and equipment -- net............... 396,665 420,601
======= =======
6 INTANGIBLE ASSETS
Intangible assets consist of the following at December 31:
1994 1993
------ ------
NOK 1,000
Organizational costs (less accumulated amortization of
2,102 and 1,401 in 1994 and 1993, respectively)........ 4,961 2,945
Goodwill (less accumulated amortization of 1,168 and 810
in 1994 and 1993, respectively)........................ 9,840 10,393
------- ------
Intangible assets -- net................................. 14,801 13,338
======= ======
7 NOTES PAYABLE AND LONG-TERM DEBT
Notes payable include a short term facility with a bank in Spain. This
facility was renewed in 1994. It bears interest at 9.6% and matures in December
1995.
Long-term debt agreements are generally entered into by the legal entities
in the various locations. To present the financial position of the division,
these amounts have been allocated between divisions operating within the legal
entities. Depending on the type of loan, various allocation bases have been
utilized including relative investment, level of operations, and working
capital.
Long-term debt consists of the following at December 31:
1994 1993
-------- -------
NOK 1,000
Mortgage loans.......................................... 6,661 4,389
Bank loans and other long-term debt..................... 45,300 14,263
Loans from Dyno and affiliated companies................ 150,477 170,285
-------- -------
Total.............................................. 202,438 188,937
Less Current portion.................................... (102,388) (32,679)
-------- -------
Total long-term debt............................... 100,050 156,258
======== =======
F-10
19
DYNO INDUSTRIER A.S FUEL TANK SYSTEM DIVISION
NOTES TO THE COMBINED FINANCIAL STATEMENTS -- (CONTINUED)
Long-term debt at December 31, 1994, matures as follows (in NOK 1,000):
1995............................................................... 102,388
1996............................................................... 5,973
1997............................................................... 26,380
1998............................................................... 3,464
1999............................................................... 3,464
Thereafter......................................................... 60,769
-------
TOTAL.................................................... 202,438
=======
Long-term debt including first year's installments are payable in the
following currencies:
CURRENCY VALUE NOK 1,000 CURRENCY VALUE NOK 1,000
CURRENCY DEC 31 1994 DEC 31 1994 DEC 31 1993 DEC 31 1993
-------- -------------- ----------- -------------- -----------
NOK..................... 43,460 43,460 16,693 16,693
GBP..................... 2,077 21,950 2,597 28,850
DEM..................... 21,542 94,039 27,139 117,597
ESB..................... 47,383 2,432 89,131 4,704
FRF..................... -- -- 13,000 16,579
BEF..................... 190,955 40,557 21,683 4,514
------- -------
TOTAL......... 202,438 188,937
======= =======
The mortgage loans relate to the building in Belgium, and are secured by
property, plant and equipment with a total net book value of approximately 97
NOK million at December 31, 1994. The loans bear interest at fixed rates ranging
from 8.09 to 10.45% and require monthly principal and interest payments. The
loans mature between 1995 and 1997.
Bank loans and other long-term debt at December 31, 1994 includes loans
from banks and other financial institutions in Belgium, Great Britain and Spain.
These loans are unsecured, generally require monthly principal payments and bear
interest at rates ranging from 6.92 to 10.8%. These loans mature in 2005, 1997,
and 1995, respectively.
Loans from Dyno and affiliated companies consists of agreements in Norway,
Germany, France and Great Britain to finance the operations and investing
strategies of the entities. These agreements are with the legal entities and
balances included in the combined financial statements are allocations of the
total outstanding balance. The agreements include both short term facilities and
long term notes depending on the cash and capital requirements of the various
entities. The agreements generally bear interest at the libor rate plus 0.5 to
0.6875%, and mature at dates ranging from 1995 to 1999.
Generally the related party loans are unsecured but contain negative pledge
clauses. The loan agreements do not contain clauses restrictive to the freedom
of action of the entities.
Subordinated Loans
The subordinated loans are all agreements with related parties that the
Division is normally consolidated with. These agreements do not bear interest
and no interest has been imputed.
The legal entity in Great Britain has a non-interest bearing GBP 2,700,000
(NOK 28,500,000) subordinated loan facility with a related party company in
Great Britain. Outstanding borrowings allocated to the Division were NOK
9,511,000 and NOK 9,998,000 at December 31, 1994 and 1993, respectively. The
facility matures August 27, 1996.
F-11
20
DYNO INDUSTRIER A.S FUEL TANK SYSTEM DIVISION
NOTES TO THE COMBINED FINANCIAL STATEMENTS -- (CONTINUED)
The legal entity in France had a non-interest bearing FFR 60,000,000 (NOK
76,519,000) subordinated loan from Dyno as of December 31, 1993, of which FFR
34,000,000 was repaid in 1994 and FFR 26,000,000 was forgiven in accordance with
an agreement between Dyno and Dynoplast S.A. in France.
The legal entity in Germany had a non-interest bearing DEM 10,800,000 (NOK
46,797,000) subordinated loan from Dyno of which NOK 38,373,000 was allocated to
the Division as of December 31, 1993, and repaid during 1994.
8 GENERAL, ADMINISTRATIVE AND OTHER ALLOCATED EXPENSES
General, administrative and other expenses are allocated to the Division
using procedures deemed appropriate for the nature of the expenses involved. The
procedures utilize various allocation bases such as relative investment, working
capital, number of employees and related payroll costs, and direct effort
expended. Management of Dyno believes the allocations are reasonable, but they
are not necessarily indicative of the costs that would have been incurred had
the Division been a stand-alone company. Additionally certain management and
overhead costs incurred by Dyno related to the Division have been included in
the combined financial statements. Such amounts totalled 10.7 NOK million in
1994 and 2.9 NOK million in 1993. These amounts have not been charged to the
production units, but have been included for presentation purposes.
Total research and development expense was (NOK 1,000) 11,414 and 13,030 in
1994 and 1993, respectively.
9 PENSION PLANS
In Norway, employees' retirement arrangements are provided by funded
defined benefit plans. The pension entitlements normally are based on years of
service and final salary. Entities in other countries have pension plans in line
with local rules and practice. Pension plans are either defined benefit plans or
defined contribution plans, where the employer pays a defined contribution which
is independently administered.
The pension assets in Norway are managed by an affiliated company and are
primarily invested in fixed interest securities, property and listed shares.
Net periodic pension cost
1994 1993
----- -----
NOK 1,000
Defined benefit plans
Benefits earned during the year.......................... 870 628
Interest cost on accrued benefit......................... 1,672 1,081
Expected return on pension assets........................ (684) (567)
----- -----
Net pension cost benefit plans........................... 1,858 1,142
----- -----
Early retirement and other............................... 35 --
----- -----
Total net periodic pension cost.................. 1,893 1,142
===== =====
This expense represents an allocation of Dyno's total pension expense based
on the ratio of the number of eligible Division employees to the total number of
eligible employees.
F-12
21
DYNO INDUSTRIER A.S FUEL TANK SYSTEM DIVISION
NOTES TO THE COMBINED FINANCIAL STATEMENTS -- (CONTINUED)
Status of pension plans reconciled to the combined balance sheet:
1994 1993
-------------------- -------------------
FUNDED UNFUNDED FUNDED UNFUNDED
PLANS PLANS PLANS PLANS
------- -------- ------ --------
NOK 1,000
Projected benefit obligation
(PBO)........................... (10,469) (9,783 ) (8,979) (9,216)
Plan assets at fair value......... 8,765 -- 8,707 --
PBO in excess of plan assets...... (1,704) (9,783 ) (272) (9,216)
Unrecognized net actuarial loss... 812 55
Early retirement plans and
other........................... (35 )
------- ------ ------ ------
Total accrued pension
liability............. (892) (9,763 ) (272) (9,216)
======= ====== ====== ======
Economic assumptions:
Discount rate................... 7.0% 7.0% 7.0% 7.0%
Rate of return -- plan assets... 8.0% -- 8.0% --
Salary increase................. 3.3% 3-3.5% 3.3% 3-3.5%
Pension increase................ 2.5% 2.5-3.0% 2.5% 2.5-3.0%
10 SHAREHOLDER'S AND DIVISIONAL EQUITY
Combined shareholder's and divisional equity consists of the following (in
NOK 1,000) at December 31:
DECEMBER 31, DECEMBER 31,
1994 1993
------------ ------------
COMMON STOCK:
Dynoplast S.A., France:
980,000 in 1993 and 1,189,996 in 1994 shares issued
at par FRF 100.................................. 150,523 29,750
Dynoplast S.A., Spain:
749,990,225 shares issued at par ESP 1............. 38,490 39,584
------- ------
Total Common Stock................................... 189,013 69,334
------- ------
Other Divisional Equity.............................. 98,645 8,053
------- ------
Total Stockholder's and Divisional Equity............ 287,658 77,387
------- ------
Balance as of beginning of year...................... 77,387 66,941
Net Income(Loss)..................................... 25,932 (54,747)
Contributed Equity................................... 185,656 65,560
Currency translation................................. (1,317) (367)
------- ------
Balance as of end of year............................ 287,658 77,387
======= ======
Contributed equity includes Dyno management and overhead costs that have
been included in the combined financial statements for presentation purposes
(see Note 8).
11 RELATED PARTIES
As described in Note 1, the Division is an integral part of Dyno and is
normally consolidated in the Dyno financial statements. Many of the Division's
production units share facilities with other Divisions of Dyno.
F-13
22
DYNO INDUSTRIER A.S FUEL TANK SYSTEM DIVISION
NOTES TO THE COMBINED FINANCIAL STATEMENTS -- (CONTINUED)
Dyno affiliates provide certain treasury, insurance, and pension fund management
services to the Division at varying degrees.
Amounts receivable from and payable to related entities comprises balances
between the Division and other Divisions in the same legal entity as well as
balances with Dyno and it's affiliates for various non-operating charges and
expenses.
In conjunction with certain financing arrangements (see Note 7), Dyno and
it's affiliates have issued letters of comfort on behalf of fuel tank business
units in favor of other lenders of approximately NOK 8,972,000 as of December
31, 1994.
The combined financial statements include sales and purchases of various
products and services to and from Dyno and its affiliates in the normal course
of business of approximately (NOK 1,000) 2,889 and 29,678 in 1994 and (NOK
1,000) 3,148 and 23,028 in 1993, respectively. Amounts due from and due to these
affiliated entities related to these transactions were approximately (NOK 1,000)
182 and 5,723 and (NOK 1,000) 810 and 4,615 as of December 31, 1994 and 1993,
respectively. These amounts are included in trade accounts receivable and
payable.
The production unit in France leased certain equipment from an affiliated
company during 1993 and 1994. This arrangement has been accounted for as a
capital lease. The equipment was purchased when the lease expired in 1994. The
capital lease obligation is included in bank loans and other long term debt at
December 31, 1993. Total payments under this arrangement were (NOK 1,000) 4,944
and 5,597 in 1994 and 1993, respectively.
12 CONTINGENCIES, GUARANTEES AND LEASE COMMITMENTS
Minimum commitments under non-cancelable leases having a remaining lease
term in excess of one year at December 31, 1994 will fall due for payment as
follows (in NOK 1,000):
1995................................................................ 14,948
1996................................................................ 15,294
1997................................................................ 11,424
1998................................................................ 10,935
1999................................................................ 10,825
Thereafter.......................................................... 6,960
------
Total..................................................... 70,386
======
Total lease expense was approximately (NOK 1,000) 22,739 and 23,739 in 1994
and 1993, respectively.
The operating unit in Norway has issued a performance bond of NOK 352,000
as of December 31, 1994.
In 1994 a former agent of the division filed a 19 FFR million
(approximately 24 NOK million) claim against Dyno Industrier A.S for breach of
the agent agreement related to procurement of materials for the production unit
in France. The litigation is still pending and Dyno intends to vigorously defend
its position. Although the final outcome cannot presently be determined, Dyno
has accrued a liability of approximately 6.7 NOK million which has been included
in the combined statements in 1994 as it relates to the operations of the
Division. In accordance with the purchase agreement (see Note 1), Dyno will
retain any obligations related to this claim.
F-14
23
DYNO INDUSTRIER A.S FUEL TANK SYSTEM DIVISION
NOTES TO THE COMBINED FINANCIAL STATEMENTS -- (CONTINUED)
13 FINANCIAL INSTRUMENTS
The financial hedging agreements as of December 31 are as follows:
1993:
1. FORWARD CONTRACTS
CONTRACT SUM (THOUSANDS)
--------------------------
BOUGHT SOLD FORWARD RATE DATE DUE CONTRACT PARTNER
---------- ------------ ------------ --------- ----------------
DEM 1,496 ESB 122,807 82.09 Jan 1994 Dyno Finans A.S
DEM 5,583 FRF 19,477 0.2867 Jan 1994 Dresdner Bank
1994:
1. FORWARD CONTRACT
CONTRACT SUM
(THOUSANDS)
-----------------------
BOUGHT SOLD FORWARD RATE DATE DUE CONTRACT PARTNER
-------- ----------- ------------ --------- ----------------
DEM
883... ESB 73,858 83.65 Jan 1995 Dyno Finans A.S
2. INTEREST RATE CAPS
CURR. AMOUNT INTEREST RATE PERIOD CONTRACT PARTNER
------------ ------------- ------------------- ----------------
(THOUSANDS)
ESB 500,000 11% 1995 - August 1997 Dyno Finans A.S
F-15
24
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
To The Board of Directors of Dyno Industrier A.S:
We have audited the accompanying combined statement of revenues and direct
costs and expenses of the Fuel Tank System Division (the "Division") of Dyno
Industrier A.S for the year ended December 31, 1992. This financial statement is
the responsibility of the Division's management. Our responsibility is to
express an opinion on this financial statement based on our audit.
We conducted our audit in accordance with auditing standards generally
accepted in the United States. Those standards require that we plan and perform
the audit to obtain reasonable assurance about whether the financial statement
is free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosure in the financial statements. An
audit also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audit provides a reasonable basis
for our opinion.
In our opinion, the financial statement presents fairly, in all material
respects, the combined revenues and direct costs and expenses of the Division
for the year ended December 31, 1992, in conformity with accounting principles
generally accepted in the United States.
DELOITTE & TOUCHE
Oslo, Norway
May 30, 1995
F-16
25
DYNO INDUSTRIER A.S FUEL TANK SYSTEM DIVISION
COMBINED STATEMENT OF REVENUES AND DIRECT COSTS AND EXPENSES
FOR THE YEAR ENDED DECEMBER 31, 1992
1992
----------
(AMOUNTS IN
NOK 1,000)
Revenues -- (Note 3)............................................................. 406,503
Cost of Goods Sold............................................................... 277,229
Gross Profit..................................................................... 129,274
Selling, General, and Administrative Expenses.................................... 177,524
---------
Operating Income (Loss).......................................................... (48,250)
=========
F-17
26
DYNO INDUSTRIER A.S FUEL TANK SYSTEM DIVISION
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 1992
1 BASIS OF PRESENTATION
The financial statements includes the combined accounts of the Fuel Tank
System Division (the Division) of Dyno Industrier A.S (Dyno), a Norwegian
company. This division comprises production units in Norway, Great Britain,
Germany, France, Belgium and Spain which are involved in the development and
manufacture of plastic automotive fuel tank systems. All significant
transactions between the division's production units have been eliminated in
combination.
The financial statements of the Division's operating units have been
combined and prepared as a result of the Purchase and Sale Agreement between
Dyno and Walbro Corporation dated April 7, 1995. Walbro Corporation is
purchasing certain divisional assets of the entities in Norway, Great Britain,
Germany and Belgium, and the shares of the entities in France and Spain.
During the period covered by the combined financial statement the
Division's business was conducted as an integral part of Dyno's overall
operations. The financial statements include sales to and purchases of materials
to and from other Dyno business units at established prices. These amounts are
not necessarily indicative of the costs that will prevail for the Division
subsequent to the closing of the transaction described in the purchase
agreement.
The combined financial statement includes all revenues and costs and
expenses directly incurred by, or related to, the Division, including
depreciation and rental cost related to facilities used in the business. The
cost of administrative and marketing personnel and facilities in certain
locations are shared with, and allocated between, other Dyno divisions. The
financial statement does not reflect any Dyno corporate management or overhead
costs, or any provision for income taxes.
The accompanying combined statement of revenues and direct costs and
expenses has been prepared in conformity with general accepted accounting
principles in the United States.
2 ACCOUNTING POLICIES
Cost of Goods Sold
Inventories are valued at the lower of cost using the 'first-in-first-out'
method or at net realizable value. Cost for goods purchased is the purchase
price. Cost for goods in production and internally produced goods is the direct
manufacturing cost plus the appropriate portion of production overhead costs.
Depreciation
Property, plant and equipment are depreciated using the straight-line
method. The rates for calculating straight-line depreciation have been
determined based on an evaluation of the individual fixed asset's economic
lifetime as follows:
machinery and equipment....................................... 3 - 20 years
buildings..................................................... 20 - 33 years
F-18
27
DYNO INDUSTRIER A.S FUEL TANK SYSTEM DIVISION
NOTES TO THE FINANCIAL STATEMENTS -- (CONTINUED)
3 REVENUES BY COUNTRY OF CUSTOMER
(IN NOK 1000)
United Kingdom................................................. 81,474
Germany........................................................ 73,029
France......................................................... 105,684
Belgium........................................................ 3,322
Sweden......................................................... 111,568
Other.......................................................... 31,426
-------
Total................................................ 406,503
=======
4 RELATED PARTY TRANSACTIONS
As described in Note 1, the Division is an integral part of Dyno and is
normally consolidated in the Dyno financial statements. Many of the Division's
production units share facilities with other divisions of Dyno.
The combined financial statement includes sales and purchases of various
products and services to and from Dyno and its affiliates in the normal course
of business totalling approximately (NOK 1,000) 2,177 and 24,274.
The production units in France and Germany leased certain equipment from an
affiliated company during the year. Total payments for the year under these
arrangements were (NOK 1,000) 9,917.
5 COMMITMENTS
The Division has various leases for certain facilities and machinery and
equipment. Total rental expense for the year was approximately (NOK 1,000)
22,922.
F-19
28
DYNO INDUSTRIER A.S FUEL TANK SYSTEM DIVISION
COMBINED BALANCE SHEETS
3/31/95 3/31/94
------- -------
(AMOUNTS IN NOK 1,000)
(UNAUDITED)
ASSETS
Current Assets:
Cash and cash equivalents............................................ 39,635 20,548
Notes receivable..................................................... 33,290 32,296
Accounts receivable -- Net........................................... 218,024 158,044
Amounts receivable from related entities............................. 6,913 11,910
Inventories:
Raw materials........................................................ 39,964 37,329
Work in progress..................................................... 25,000 32,926
Finished goods....................................................... 27,308 28,984
------- -------
Total Inventories............................................ 92,272 99,239
------- -------
Prepaid expenses and other current assets............................ 62,770 34,697
------- -------
Total Current Assets......................................... 452,904 356,734
======= =======
Property, Plant and Equipment -- Net................................... 387,510 402,524
Other Assets:
Long term receivables................................................ 11,965 26,564
Intangible assets -- Net............................................. 14,050 13,725
Deferred taxes....................................................... 10,158 17,421
Other................................................................ 3,639 3,624
------- -------
Total Other Assets........................................... 39,812 61,334
------- -------
Total Assets................................................. 880,226 820,592
======= =======
LIABILITIES AND SHAREHOLDERS' AND DIVISIONAL EQUITY
Current Liabilities:
Bank overdraft....................................................... 2,678 3,746
Accounts payable..................................................... 205,716 228,389
Accrued liabilities.................................................. 49,718 82,931
Current portion of long term debt.................................... 96,784 36,269
Amounts payable to related entities.................................. 27,715 19,900
Notes payable........................................................ 29,220 31,920
Income taxes payable................................................. 2,770 971
------- -------
Total Current Liabilities.................................... 414,601 404,126
======= =======
Long Term Debt -- Less current portion................................. 113,566 169,631
Subordinated Loan...................................................... 8,984 124,742
Deferred Taxes......................................................... 27,003 18,850
Other Long Term Liabilities............................................ 16,232 13,263
Shareholders' and Divisional Equity.................................... 299,840 89,980
------- -------
Total Liabilities and Shareholders' and Divisional Equity.... 880,226 820,592
======= =======
F-20
29
DYNO INDUSTRIER A.S FUEL TANK SYSTEM DIVISION
COMBINED INCOME STATEMENTS
THREE MONTHS ENDED
---------------------
3/31/95 3/31/94
------- -------
(AMOUNTS IN NOK 1,000)
(UNAUDITED)
Revenues.............................................................. 348,606 236,057
Cost of Goods Sold.................................................... 273,338 181,938
------- -------
Gross Profit.......................................................... 75,268 54,119
------- -------
Selling, General, and Administrative Expenses -- (Note 1)............. 53,527 52,396
------- -------
Operating Income...................................................... 21,741 1,723
------- -------
Other Income (Expense):
Interest expense.................................................... (5,131) (6,699)
Interest income..................................................... 1,806 1,333
Other expense -- Net................................................ (1,324) (421)
------- -------
Total Other Income (Expense)................................ (4,649) (5,787)
------- -------
Income (Loss) Before Taxes............................................ 17,092 (4,064)
------- -------
Income Taxes.......................................................... 5,198 4,531
------- -------
Net Income (Loss)........................................... 11,894 (8,595)
======= =======
F-21
30
DYNO INDUSTRIER A.S FUEL TANK SYSTEM DIVISION
COMBINED STATEMENTS OF CASH FLOWS
THREE MONTHS ENDED
----------------------
3/31/95 3/31/94
-------- --------
(AMOUNTS IN NOK 1,000)
(UNAUDITED)
Cash Flows From Operating Activities:
Net income (loss).................................................. 11,894 (8,595)
Adjustments to reconcile net income to net cash provided by
operating activities:
Depreciation and amortization................................. 17,364 15,499
Change in deferred income taxes............................... 5,199 (2,248)
(Gain) loss on sale of property, plant and equipment.......... (58) 94
Changes in operating assets and liabilities:
(Increase) decrease:
Accounts and notes receivable.............................. (36,900) (39,093)
Inventories................................................ (6,662) (11,105)
Prepaid expenses and other current assets.................. (19,238) 9,141
Long-term receivables and other assets..................... 5,354 6,442
Increase (decrease):
Accounts payable........................................... 58,251 119,563
Accrued and other liabilities.............................. (30,648) (41,532)
-------- --------
Net cash provided by operating activities..................... 4,556 48,166
======== ========
Cash Flows From Investing Activities:
Purchases of property, plant and equipment......................... (9,185) (13,934)
Proceeds from sale of property, plant and equipment................ 1,362 16,563
(Advances to) repayments from related entities -- net.............. 12,994 (97,989)
-------- --------
Net cash provided by (used in) investing activities................ 5,171 (95,360)
-------- --------
Cash Flows From Financing Activities:
Borrowings of long-term debt....................................... 8,739 15,006
Repayments of long-term debt....................................... (3,272) (1,270)
Net change of related party long-term debt......................... 2,987 8,269
Contributed equity................................................. 2,326 22,937
-------- --------
Net cash provided by financing activities............................ 10,780 44,942
-------- --------
Foreign currency effects on cash flows............................... (5,008) (2,485)
Net increase (decrease) in cash and cash equivalents................. 15,499 (4,737)
-------- --------
Cash and cash equivalents at beginning of year....................... 24,136 25,285
-------- --------
Cash and cash equivalents at end of period........................... 39,635 20,548
======== ========
F-22
31
DYNO INDUSTRIER A.S FUEL TANK SYSTEM DIVISION
NOTES TO THE COMBINED FINANCIAL STATEMENTS
1 ACCOUNTING POLICIES AND PRINCIPLES OF COMBINATION
The condensed combined interim financial statements and notes should be
read in conjunction with the combined financial statements and notes for the
fuel tank system division for the year ended December 31, 1994. The condensed
combined financial statements have been prepared in accordance with United
States generally accepted accounting principles. The interim combined financial
statements are unaudited and reflect all adjustments which are, in the opinion
of management, necessary to present fairly the results of operation for the
periods presented.
During the periods covered by the combined income statements the Division's
business was conducted as an integral part of Dyno Industrier A.S's ("Dyno")
overall operations. The combined financial statements include sales to and
purchases of materials to and from other Dyno business units at established
prices. They also include various allocated costs and expenses which are not
necessarily indicative of the costs and expenses which would have resulted had
the Division been operated as a separate company. All of the allocations and
estimates reflected in the combined financial statements are based on
assumptions that the production units' and Dyno's management believes are
reasonable. Additionally certain management and overhead costs incurred by Dyno
related to the Division have been included in the combined financial statements.
Such amounts totaled 2.3 and 1.4 NOK million for the three months ended March
31, 1995 and 1994, respectively. These amounts have not been charged to the
production units, but have been included for presentation purposes. Total
research and development expense was 2.4 and 2.6 NOK million for the three
months ended March 31, 1995 and 1994, respectively.
2 CONTINGENCIES
In 1994 a former agent of the Division filed a 19 FFR million
(approximately 24 NOK million) claim against Dyno Industrier A.S for breach of
the agent agreement related to procurement of materials for the production unit
in France. The litigation is still pending and Dyno intends to vigorously defend
its position. Although the final outcome cannot presently be determined, Dyno
has accrued a liability of approximately 6.7 NOK million which has been included
in the combined statements as it relates to the operations of the Division. In
accordance with the purchase and sale agreement (see Note 3), Dyno will retain
any obligations related to this claim.
3 SUBSEQUENT EVENT
In April 1995, Dyno signed a purchase and sale agreement with Walbro
Corporation. Walbro is purchasing certain divisional assets of the entities in
Norway, Great Britain, Germany and Belgium, and the shares of the entities in
France and Spain. The price of the acquisition will be approximately USD 124
million, subject to certain adjustments. The transaction is expected to close in
the summer of 1995.
F-23
32
Exhibit Index
-------------
Sequential
Page
Exhibit # Item Number
--------- ---- ----------
2.2 Addendum to Dyno Agreement by and between Walbro
Corporation and Dyno Industrier A.S, dated as of
July 27, 1995.
2.3 Indenture dated as of July 27, 1995 among Walbro
Corporation, Walbro Automotive Corporation, Walbro
Engine Management Corporation, Sharon Manufacturing
Company, Whitehead Engineered Products, Inc. and
Bankers Trust Company.
2.4 Walbro Corporation $135,000,000 Credit Agreement
dated as July 26, 1995, with Comerica Bank, as agent.
23.1 Consent of Arthur Andersen & Co. GmbH
23.2 Consent of Arthur Andersen & Co. GmbH
23.3 Consent of Deloitte & Touche
EX-2.2
2
EXHIIBT 2.2
1
EXHIBIT 2.2
ADDENDUM
This ADDENDUM (this "Addendum") is made as of this 26th day of July,
1995, by and between Dyno Industrier A.S., a Norwegian corporation ("Seller")
and Walbro Corporation, a Delaware corporation.
WHEREAS, Seller and Walbro Corporation have entered into a Purchase
and Sale Agreement dated April 7, 1995 (the "Purchase and Sale Agreement"),
whereby Walbro Corporation and its subsidiaries (jointly and severally,
"Purchaser") will purchase all of the Assets related to the Business.
WHEREAS, Seller and Purchaser desire to modify and supplement the
Purchase and Sale Agreement pursuant to the terms set forth in this Addendum.
WHEREAS, all capitalized terms used and not otherwise defined herein
shall have the meanings set forth in the Purchase and Sale Agreement. Unless
otherwise indicated, all references to schedules and exhibits contained in this
Addendum shall be references to the Schedules and the Exhibits to the Purchase
and Sale Agreement.
NOW, THEREFORE, in consideration of the mutual covenants of the
parties set forth herein and in the Purchase and Sale Agreement, Purchaser and
Sale Agreement, Purchaser and Seller agree as follows:
1. FINLAND OPTION.
Section 4.24 is hereby replaced by the following:
a. Seller agrees that Purchaser shall have an option, to be exercised at
Purchaser's will, to acquire the automotive blow molding and truck
blow molding business (the "Automotive Business") and the other
technical non-automotive blow molded business which is produced on the
same machines as the Automotive Business (the "Non-Automotive
Business") of Dynoplast OY in Finland. The current Automotive
Business includes the sale of products, generally constituting (1)
coolant reservoirs to Volvo truck, (2) washer reservoirs to Scania and
(3) air-ducts to SAAB Auto, and also includes the machines and
equipment utilized in producing such products. Within 60 days after
Closing, Seller shall provide to Purchaser a detailed list of
Automotive Business and Non-Automotive Business products with
information regarding the name of the customers, the product
description, 1994 sales volume in units and the machines utilized in
the business.
b. The option shall be for all machines, tools and contracts ("OY
Assets") of the Automotive Business and Non-Automotive Business of
Dynoplast OY and of the Automotive Business of any of its affiliates,
wherever located. The price will be calculated in accordance with
Exhibit 1.b attached hereto and will be for all the OY
2
Assets related to the operation of such businesses Finland only. If
the parties cannot agree upon the price for the OY Assets pursuant to
the provisions in Exhibit 1.b they shall mutually select an appraiser
knowledgeable in the automotive industry, whose opinion shall be final
and binding.
c. Seller agrees that all machines and equipment used in the Automotive
Business shall remain at Dynoplast OY's plant at Turku, Finland.
d. Seller agrees to compensate Purchaser if, for any reason, any of the
Automotive Business which is currently carried out at Kongsvinger
shall be transferred to Dynoplast OY. Such compensation shall be
calculated as follows:
If there is a transfer of such business at the initiation of
the customer, then Seller shall pay to Purchaser an amount
equal to Dynoplast OY's profits with respect to such business.
If there is a transfer of such business at the initiation of
Dynoplast OY, then Seller shall pay to Purchaser an amount
equal to Purchaser's loss with respect to such business.
e. Seller agrees that at Purchaser's request, Seller shall assist
Purchaser in establishing contact with Dynoplast OY's customers in the
Automotive Business. The parties agree that all contact with
customers shall be aimed at maintaining and developing the customer
base.
f. The option hereunder is exercisable at any time within 36 months after
Closing, with a consummation of the transaction to occur within 18
months following the date of exercise of the option.
2. PAYMENT OF PURCHASE PRICE.
Seller and Purchaser agree to modify Section 2.1 of the Purchase and
Sale Agreement so that the total Purchase Price will be paid in USD,
the conversion from NOK and DM to be calculated based on the following
exchange rates: (1) DM 1.3924 equals USD 1 and (2) NOK 6.1790 equals
USD 1.
3. GERMAN ENVIRONMENTAL MATTERS.
a. Purchaser hereby waives Seller's obligation to remove certain
hydrocarbon pollution in the soil at the location of the Business in
Germany, as referenced in Section 4.23 of the Purchase and Sale
Agreement, and agrees that Seller shall have no liability in
connection therewith. The Purchase Price will be increased (pursuant
to Section 2.3 of the Purchase and Sale Agreement) DM 150,000 to
reflect the fact the reserve on Seller's books for such obligations is
no longer needed.
b. The Purchase Price will be decreased (pursuant to Section 2.3 of the
Purchase and Sale Agreement) DM 500,000 in consideration of releasing
Seller from its obligation to repair all cracks in the plant floor in
Germany pursuant to Section 4.23 of the Purchase and Sale Agreement.
-2-
3
4. REAL PROPERTY IN NORWAY.
Purchaser and Seller acknowledge that separate lease agreements with
the owner of the real property in Kongsvinger, Norway, will not be
entered into prior to the Closing. Pursuant to Section 4.11 of the
Purchase and Sale Agreement, Seller or its Subsidiary will provide the
space to Purchaser required to operate the Business pursuant to a
sublease or similar arrangement. The lease payments to be paid by
Purchaser to Seller shall be based upon the current allocation of the
lease at the Kongsvinger plant between its technical department and
packaging department. When such separate lease agreements are entered
into, the lease payments shall be allocated to the separate sections
of the building as determined by SIVA and will be based upon Seller's
and Purchaser's respective use of each separate section. In
consideration of the above, the Purchase Price shall be decreased
(pursuant to Section 2.3 of the Purchase and Sale Agreement) by NOK
1,050,000.
5. NORWEGIAN ENVIRONMENTAL MATTERS.
Seller agrees that, in the event of a discharge of oil or other
substances into the Glomma River from the air compressor at the
Kongsvinger Plant prior to September 1, 1995, Seller will indemnify
Purchaser from any "loss". For purposes of this section, a "loss"
shall include all customer or governmental penalties, fines or charges
incurred by Purchaser and any direct or indirect labor costs incurred
for the period that production is partially or completely shut down.
6. WELSH INVESTMENT GRANTS.
Pursuant to an agreement dated in July, 1995 ("the Welsh Agreement")
entered into between (1) the Secretary of State for Wales, (2)
Dynoplast Limited and (3) Walbro Automotive Limited ("WAL") the
Secretary of State for Wales gave permission to Dynoplast Limited for
the transfer to WAL of certain business assets and employees situated
at Deeside. In the Welsh Agreement, WAL agreed to be bound by the
terms of sub-clauses 8.1(b)(i), 8.1(b)(ii) and 8.1(d) of the offer
letter dated 17 April 1991 (as subsequently amended by a letter dated
12 June 1992) from the Secretary of State for Wales to Dynoplast
Limited. In the event that WAL suffers any fees, costs, damages or
losses under the Welsh Agreement, other than due to the fact that WAL
ceases operations at or subleases any of the premises at Deeside
within three years of entering into the Welsh Agreement or violates
sub-clause 8.1(b)(ii) of the offer letter, Seller hereby agrees to
indemnify WAL against all such fees, costs, damages or losses incurred
by it.
In the event Purchaser terminates the lease in Deeside pursuant to
Section 10 thereof after 2 years, then Purchaser shall indemnify
Seller for any costs, damages and expenses incurred by Seller in
favour of the Welsh Development Agency including any payment
obligations to it under the offer letter.
-3-
4
7. GERMAN SPARE PARTS INVENTORY.
The Purchase Price will be increased (pursuant to Section 2.3 of the
Purchase and Sale Agreement) DM 264,525 in consideration for
Purchaser's purchase of the spare parts inventory used by the
packaging business at the German plant. Upon the termination of the
German toll agreement (Exhibit 4.8 of the Purchase and Sale
Agreement), Seller shall repurchase all such spare parts at their net
book value utilizing Seller's existing accounting principals.
8. ALLOCATION OF PURCHASE PRICE.
Purchaser and Seller agree to revise Schedule 2.5 of the Purchase and
Sale Agreement in accordance with Exhibit 8 attached. In addition,
following the Closing, Purchaser and Seller agree to allocate the
Purchase Price for Assets located at the German, Norwegian and United
Kingdom plants based on the fair market value of such assets.
9. PENSION PLANS.
a. Section 2.3.2 of the Purchase and Sale Agreement is hereby
amended to give Purchaser until 60 days after the Closing to
review and agree or object to the actuaries' calculation of
the net underfunding or overfunding in accordance with the
provisions of Section 2.3.2.
b. Section 4.7.1 of the Purchase and Sale Agreement is hereby
amended to give Purchaser 60 days after the Closing to
establish Purchaser Employee Plans pursuant to the terms of
that Section.
c. Section 4.7.2 of the Purchase and Sale Agreement is hereby
modified to provide that the amount of assets to be
transferred thereunder shall equal the amount of assets in
such Employee Plans attributable to the Hired Employees at
December 31, 1994, increased by the applicable portion of the
total yield on the total amount of assets in such Employee
Plans maintained by Seller for the period from January 1,
1995, until the date of transfer. The date of transfer shall
not be later than October 27, 1995.
10. SUMITOMO MATTER.
Seller has delivered to Purchaser a letter from Sumitomo addressed to
Seller stating that Sumitomo's claim against Seller for commission
payments has been fully resolved to Sumitomo's satisfaction;
nevertheless, Seller agrees to indemnify Purchaser for any costs or
expenses incurred by Purchaser in connection with claims by Sumitomo
against Purchaser for commission payments.
11. JOURNEE OPTION.
Purchaser hereby agrees to waive Seller's obligations under Section
4.26 of the Purchase and Sale Agreement.
-4-
5
12. SCHEDULE 5.1.4.
Schedule 5.1.4 to the Purchase and Sale Agreement is hereby amended to
delete Oyvind Jensrud and Jens Njosen and add Peter McHugo. Peter
McHugo shall be permitted to return to the employ of Seller on
December 31, 1996.
13. ELBANTAINER ITALIA.
Seller agrees to reimburse Buyer for any costs and expenses incurred
by Buyer with respect to the dissolution of Elbatainer Italia.
14. GERMAN ENVIRONMENTAL PERMITS.
Seller consents to Walbro Automotive GmbH ("WAG") using all permits
obtained by Dynoplast Elbatainer GmbH's ("DEG") permits to dispose of
waste and use and discharge of used groundwater for the production
site in Ettlingen as necessary to run the Fuel Tank Business. This
consent is granted until WAG has obtained permits equivalent to the
permits now granted to DEG. Purchaser agrees to use its best efforts
to get all necessary permits.
Purchaser agrees to reimburse DEG for any costs incurred related to
WAG's use of the above mentioned permits, and assumed liability for
all damages caused by its use of the permits.
15. BELGIUM BANK LIENS.
Purchaser hereby waives Seller's obligation to release the floating
liens in favour of two Belgium banks listed on Schedule 3.1.6 of the
Purchase and Sale Agreement prior to Closing. Seller undertakes to
have these releases recorded at the Mortgage Office in Gent as soon as
possible after Closing, but no later than September 30, 1995.
16. SPECIAL ACCOUNTING.
Seller and Purchaser hereby agree to modify Section 4.18 of the
Purchase and Sale Agreement as follows:
(a) Accounts receivable and payable arising from transactions in
the ordinary course of business between the Business and the
Seller and any of its Affiliates (other than any operating
unit of the Business) (i.e. sales of goods, invoicing,
re-invoicing of expenses) will not be subject to the
calculation of interest charge;
(b) Section 4.18.2 is hereby amended to change from 45 days to 60
days.
(c) Section 4.18.2(2) of the Purchase and Sale Agreement shall be
modified to add the following: (c) There shall be a charge to
the Kongsvinger unit for all employment expenses related to
Trond Tenold and Oyvind Jensrud for the period from January 1,
1995 until the Closing Date.
-5-
6
17. NORWEGIAN LABOR COMPLIANCE.
Seller shall review within 60 days after the Closing, the report from
the Norwegian Labor Directorate regarding compliance of all Norwegian
working environmental legislation at the Kongsvinger plant and shall
at its cost immediately remedy any deviation from such legislation
identified in such report applicable to the Business at Kongsvinger.
Seller shall provide to Purchaser no later than September 30, 1995 a
report listing all such deviations and the corrective actions to be
taken.
18. ASSUMED LIABILITIES.
Section 2.1.1(1) of the Purchase and Sale Agreement is hereby modified
for greater clarity to provide that Purchaser shall not assume any
liabilities with respect to Fispa Ulma and/or Mr. Darrou.
19. FRENCH DEBT FOREGIVENESS.
Seller hereby agrees that the Foregiveness of Debt Agreement dated
September 1, 1994, between Seller and Dynoplast S.A. France is hereby
cancelled and null and void, effective at the Closing.
20. FLATS IN KONGSVINGER.
Purchaser hereby agrees to waive Seller's obligation to transfer title
to Purchaser of the two flats in Kongsvinger referred to in Schedule
3.12 provided such title is passed by appropriate conveyance documents
by August 30, 1995.
21. NET WORKING CAPITAL.
Seller and Purchaser agree to substitute NOK 145,000,000 for NOK
148,100,000 in Section 2.3.1.
22. REQUIRED CONSENTS.
Seller and Purchaser acknowledge that the parties have not obtained
all Required Consents pursuant to Section 4.22 and 5.1.2 of the
Purchase and Sale Agreement. Purchaser hereby waives Seller's
obligation with respect to such Required Consents as a condition to
Closing; provided however, that the parties shall use their best
efforts to comply with their obligations under Section 4.22 by
September 30, 1995.
23. INTEREST ON SPANISH BANK DEPOSIT.
The Purchase Price will be increased (pursuant to Section 2.3 of the
Purchase and Sale Agreement) USD 27,961 to reflect Seller's accrued
interest on the Spanish Bank Deposit, described in Section 4.30, for
the period ended December 31, 1994, which interest along with any
interest accruing after December 31, 1994, shall belong to the
Purchaser.
-6-
7
24. EXTENSIONS IN GENT AND ETTLINGEN.
Purchaser shall have the option, exercisable upon written notice at
least 12 months prior to the expiration of the initial 18 month term
of the agreement respecting the use by Walbro of the premises in
Belgium and the Gent Sharing Agreement (the "Belgium Agreements"), to
extend the Belgium Agreements for a period of up to 2 years. In the
event such option is exercised, Purchaser shall have an option to
extend the German Toll Production Agreement for a period corresponding
to the extended term of the Belgium Agreements with respect to
approximately one-third of the space currently used for production of
Seller's products in the premises in Ettlingen.
25. BELGIUM WAREHOUSE.
The lease for the warehouse space (Wachtebeke) in Belgium shall be
transferred directly to Walbro Automotive N.V. by August 30, 1995.
From July 29, 1995, until such time as this lease has been
transferred, all amounts owing under the existing lease shall be for
the account of Purchaser.
26. CERTAIN LIABILITIES.
For greater certainty, the parties acknowledge that there shall be no
reduction to the Purchase Price pursuant to Section 2.3.3 by reason of
the guarantee obligations assumed by Purchaser referred to in Schedule
2.3.3.
27. CERTAIN GERMAN EMPLOYEES.
The parties agree that there are up to ten employees who will be
assumed by Purchaser in excess of the current budgeted employment
requirements of the Business in Germany. During the duration the Toll
Production Agreement and upon its termination, Purchaser shall use its
best efforts to integrate such employees into its operations to the
extent possible and take over full employment responsibility for such
employees on a preferential basis rather than hiring new employees.
Upon the termination of the Toll Production Agreement, Seller shall be
liable for any severance costs in relation to up to ten employees
whose termination is directly related to the termination of the Toll
Production Agreement.
28. NEDCAR ADJUSTMENT.
Section 2.3.9 of the Purchase and Sale Agreement is amended to
substitute BEF 27,672,053 for BEF 20,335,409.
29. GERMAN PACKAGING INVENTORY.
Purchaser agrees to purchase from Seller the packaging inventory at
Ettlingen on July 27, 1995, at a price computed under the principals
of Section 3.3 of the German Toll Production Agreement, Payment shall
be due on the same date as Seller pays Purchaser
-7-
8
with respect to the Special Accounting in Section 4.18.3 of the
Purchase and Salle Agreement. The payment shall bear interest at the
rate of 7.06% per annum.
30. ADDITIONAL PURCHASE PRICE.
Section 2.1.2 of the Purchase and Sale Agreement is hereby amended to
provide that the Additional Purchase Price on which interest is
calculated shall not include adjustments under Section 2.3.8 of the
Purchase and Sale Agreement or Sections 3, 4, 7 and 23 of this
Addendum.
IN WITNESS WHEREOF, the parties have executed this Addendum as of the
date first above written.
SELLER: PURCHASER:
DYNO INDUSTRIER A.S. WALBRO CORPORATION
By: ________________________________ By: __________________________________
a duly authorized signatory a duly authorized signatory
-8-
9
FINAL
Calculation of 2.5. Allocation of Purchase Price
Country Allocation Key Allocation in USD
-----------------------------------------------------------------
1 Norway 22,9% 31.688.708
2 Germany 25,3% 35.009.795
3 Belgium 15,6% 21.587.068
4 France 18,6% 25.738.427
5 Spain 7,5% 10,378.398
6 United Kingdom 10,1% 13.976.242
------------------------------------------------------------------
Total 100,0% 138.378.638
------------------------------------------------------------------
-9-
10
EXHIBIT 1.B
The price for the OY Assets shall be calculated as follows:
1. In the event the Finland business is moved from Turku by Purchaser,
the purchase price shall be the higher of:
(a) EBITDA times a multiple of 5.0, 4.5 or 4.0 in the event the
option is exercised in 1996, 1997 or 1998 respectively; and
(b) EBITDA times a multiple of 4.0, 3.5 or 3.0 in the event the
option is exercised in 1996, 1997 or 1998 respectively plus 2
times Fixed Costs included in EBITDA.
2. In the event the Finland business is not moved from Turku by
Purchaser, the purchase price shall be equal to EBITDA times a
multiple of 4.0, 3.5 or 3.0 in the event the option is exercised in
1996, 1997 or 1998 respectively. In such event, Purchaser shall
covenant to keep the business in Turku for a period of 30 months and
to enter into a toll production agreement with a price to Dyno which
gives Dyno full coverage for its direct and indirect costs consistent
with expense allocation used in calculating EBITDA above.
For the purpose hereof, EBITDA shall be calculated as of December 31 for the
year previous to the year in which the option is exercised and EBITDA shall be
audited by an accounting firm acceptable to both Seller and Purchaser.
The Purchase Price shall be increased on a Finnish Mark for Finnish Mark basis
to the extent the Net Working Capital exceeds 2:1 and the purchase price shall
be similarly reduced if it is less than 2:1.
For the purposes of calculating Net Working Capital, current liabilities shall
not include any interest bearing indebtedness and current liabilities shall
also be adjusted to reflect an outstanding period of 40 days.
In no event shall the purchase price determined in accordance with 1 or 2 above
be less than the fair market value of the OY Assets.
-10-
EX-2.3
3
EXHIBIT 2.3
1
EXHIBIT 2.3
================================================================================
Indenture
Dated as of July 27, 1995
among
WALBRO CORPORATION,
as Issuer,
WALBRO AUTOMOTIVE CORPORATION,
WALBRO ENGINE MANAGEMENT CORPORATION,
SHARON MANUFACTURING COMPANY,
WHITEHEAD ENGINEERED PRODUCTS, INC.,
as Guarantors,
and
BANKERS TRUST COMPANY,
as Trustee
-----------------
$110,000,000
9-7/8% Senior Notes due 2005, Series A
9-7/8% Senior Notes due 2005, Series B
================================================================================
2
CROSS-REFERENCE TABLE
TIA Indenture
Section Section
------- ---------
310 (a)(1) ............................................... 7.10
(a)(2) ............................................... 7.10
(a)(3) ............................................... N.A.
(a)(4) ............................................... N.A.
(a)(5) ............................................... 7.10
(b) ................................................... 7.10
(c) ................................................... N.A.
311 (a) ................................................... 7.11
(b) ................................................... 7.11
(c) ................................................... N.A.
312 (a) ................................................... 2.05
(b) ................................................... 11.03
(c) ................................................... 11.03
313 (a) ................................................... 7.06
(b)(1) ............................................... N.A.
(b)(2) ............................................... 7.06
(c) ................................................... 7.06; 11.02
(d) ................................................... 7.06
314 (a) ................................................... 4.08; 4.10
(b) ................................................... N.A.
(c)(1) ............................................... 4.08; 11.04
(c)(2) ............................................... 11.04
(c)(3) ............................................... 4.08
(d) ................................................... N.A.
(e) ................................................... 11.05
(f) ................................................... N.A.
315 (a) ................................................... 7.01(b)
(b) ................................................... 7.05; 11.02
(c) ................................................... 7.01(a)
(d) ................................................... 6.05; 7.01(c)
(e) ................................................... 6.11
316 (a)(last sentence)..................................... 2.09
(a)(1)(A).............................................. 6.05
(a)(1)(B).............................................. 6.04
(a)(2)................................................. N.A.
(b) ................................................... 6.07
317 (a)(1)................................................. 6.08
(a)(2)................................................. 6.09
(b) ................................................... 2.04
318 (a) ................................................... 11.01
(c) ................................................... 11.01
----------------------
N.A. means Not Applicable
NOTE: This Cross-Reference Table shall not, for any purpose, be deemed to be a
part of the Indenture.
3
TABLE OF CONTENTS
Page
----
ARTICLE I
DEFINITIONS AND INCORPORATION
BY REFERENCE
Section 1.01 Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Section 1.02 Incorporation by Reference of TIA . . . . . . . . . . . . . . . . . . . . 24
Section 1.03 Rules of Construction . . . . . . . . . . . . . . . . . . . . . . . . . . 25
ARTICLE II
THE SECURITIES
Section 2.01 Form and Dating . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
Section 2.02 Execution and Authentication . . . . . . . . . . . . . . . . . . . . . . 26
Section 2.03 Registrar and Paying Agent . . . . . . . . . . . . . . . . . . . . . . . 27
Section 2.04 Paying Agent To Hold Assets in Trust . . . . . . . . . . . . . . . . . . 28
Section 2.05 Securityholder Lists . . . . . . . . . . . . . . . . . . . . . . . . . . 28
Section 2.06 Transfer and Exchange . . . . . . . . . . . . . . . . . . . . . . . . . . 29
Section 2.07 Replacement Securities . . . . . . . . . . . . . . . . . . . . . . . . . 30
Section 2.08 Outstanding Securities . . . . . . . . . . . . . . . . . . . . . . . . . 30
Section 2.09 Treasury Securities . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
Section 2.10 Temporary Securities . . . . . . . . . . . . . . . . . . . . . . . . . . 31
Section 2.11 Cancellation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
Section 2.12 Defaulted Interest . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
Section 2.13 CUSIP Number . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
Section 2.14 Deposit of Moneys . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
Section 2.15 Book-Entry Provisions for Global
Securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
Section 2.16 Registration of Transfers and Exchanges . . . . . . . . . . . . . . . . . 34
Section 2.17 Designation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
ARTICLE III
REDEMPTION
Section 3.01 Notices to Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
Section 3.02 Selection of Securities To Be Redeemed . . . . . . . . . . . . . . . . . 39
Section 3.03 Notice of Redemption . . . . . . . . . . . . . . . . . . . . . . . . . . 40
Section 3.04 Effect of Notice of Redemption . . . . . . . . . . . . . . . . . . . . . 41
Section 3.05 Deposit of Redemption Price . . . . . . . . . . . . . . . . . . . . . . . 41
Section 3.06 Securities Redeemed in Part . . . . . . . . . . . . . . . . . . . . . . . 42
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----
ARTICLE IV
COVENANTS
Section 4.01 Payment of Securities . . . . . . . . . . . . . . . . . . . . . . . . . . 42
Section 4.02 Maintenance of Office or Agency . . . . . . . . . . . . . . . . . . . . . 42
Section 4.03 Limitation on Restricted Payments . . . . . . . . . . . . . . . . . . . . 43
Section 4.04 Limitation on Indebtedness . . . . . . . . . . . . . . . . . . . . . . . 46
Section 4.05 Corporate Existence . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
Section 4.06 Payment of Taxes and Other Claims . . . . . . . . . . . . . . . . . . . . 50
Section 4.07 Maintenance of Properties and Insurance . . . . . . . . . . . . . . . . . 51
Section 4.08 Compliance Certificate; Notice of Default . . . . . . . . . . . . . . . . 51
Section 4.09 Compliance with Laws . . . . . . . . . . . . . . . . . . . . . . . . . . 52
Section 4.10 SEC Reports . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
Section 4.11 Waiver of Stay, Extension or Usury Laws . . . . . . . . . . . . . . . . . 53
Section 4.12 Limitation on Transactions with Interested
Persons . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54
Section 4.13 Limitation on Dividend and Other Payment
Restrictions Affecting Subsidiaries . . . . . . . . . . . . . . . . . . 54
Section 4.14 Limitation on Liens . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
Section 4.15 Change of Control . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56
Section 4.16 Disposition of Proceeds of Asset Sales . . . . . . . . . . . . . . . . . 58
Section 4.17 Limitation on Issuance and Sale of
Preferred Stock by Restricted
Subsidiaries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
Section 4.18 Limitation on Sale-Leaseback Transactions . . . . . . . . . . . . . . . . 62
ARTICLE V
SUCCESSOR CORPORATION
Section 5.01 Mergers, Consolidations and Sale of
Assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
Section 5.02 Successor Corporation Substituted . . . . . . . . . . . . . . . . . . . . 64
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Page
----
ARTICLE VI
DEFAULT AND REMEDIES
Section 6.01 Events of Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . 65
Section 6.02 Acceleration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 67
Section 6.03 Other Remedies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 68
Section 6.04 Waiver of Past Defaults . . . . . . . . . . . . . . . . . . . . . . . . . 68
Section 6.05 Control by Majority . . . . . . . . . . . . . . . . . . . . . . . . . . . 69
Section 6.06 Limitation on Suits . . . . . . . . . . . . . . . . . . . . . . . . . . . 69
Section 6.07 Rights of Holders To Receive Payment . . . . . . . . . . . . . . . . . . 70
Section 6.08 Collection Suit by Trustee . . . . . . . . . . . . . . . . . . . . . . . 70
Section 6.09 Trustee May File Proofs of Claim . . . . . . . . . . . . . . . . . . . . 70
Section 6.10 Priorities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 71
Section 6.11 Undertaking for Costs . . . . . . . . . . . . . . . . . . . . . . . . . . 71
ARTICLE VII
TRUSTEE
Section 7.01 Duties of Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . 72
Section 7.02 Rights of Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . 73
Section 7.03 Individual Rights of Trustee . . . . . . . . . . . . . . . . . . . . . . 74
Section 7.04 Trustee's Disclaimer . . . . . . . . . . . . . . . . . . . . . . . . . . 75
Section 7.05 Notice of Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . 75
Section 7.06 Reports by Trustee to Holders . . . . . . . . . . . . . . . . . . . . . . 75
Section 7.07 Compensation and Indemnity . . . . . . . . . . . . . . . . . . . . . . . 76
Section 7.08 Replacement of Trustee . . . . . . . . . . . . . . . . . . . . . . . . . 77
Section 7.09 Successor Trustee by Merger, Etc. . . . . . . . . . . . . . . . . . . . . 78
Section 7.10 Eligibility; Disqualification . . . . . . . . . . . . . . . . . . . . . . 79
Section 7.11 Preferential Collection of Claims
Against Company . . . . . . . . . . . . . . . . . . . . . . . . . . . . 79
ARTICLE VIII
SATISFACTION AND DISCHARGE OF INDENTURE
Section 8.01 Legal Defeasance and Covenant Defeasance . . . . . . . . . . . . . . . . 79
Section 8.02 Satisfaction and Discharge . . . . . . . . . . . . . . . . . . . . . . . 83
Section 8.03 Survival of Certain Obligations . . . . . . . . . . . . . . . . . . . . . 84
Section 8.04 Acknowledgment of Discharge by Trustee . . . . . . . . . . . . . . . . . 84
Section 8.05 Application of Trust Assets . . . . . . . . . . . . . . . . . . . . . . . 85
Section 8.06 Repayment to the Company or Guarantors;
Unclaimed Money . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 85
Section 8.07 Reinstatement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 86
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6
Page
----
ARTICLE IX
AMENDMENTS, SUPPLEMENTS AND WAIVERS
Section 9.01 Without Consent of Holders . . . . . . . . . . . . . . . . . . . . . . . 86
Section 9.02 With Consent of Holders . . . . . . . . . . . . . . . . . . . . . . . . . 87
Section 9.03 Compliance with TIA . . . . . . . . . . . . . . . . . . . . . . . . . . . 88
Section 9.04 Revocation and Effect of Consents . . . . . . . . . . . . . . . . . . . . 89
Section 9.05 Notation on or Exchange of Securities . . . . . . . . . . . . . . . . . . 90
Section 9.06 Trustee To Sign Amendments, Etc. . . . . . . . . . . . . . . . . . . . . 90
ARTICLE X
GUARANTEE
Section 10.01 Unconditional Guarantee . . . . . . . . . . . . . . . . . . . . . . . . . 90
Section 10.02 Severability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 92
Section 10.03 Release of a Guarantor . . . . . . . . . . . . . . . . . . . . . . . . . 92
Section 10.04 Limitation of Guarantor's Liability . . . . . . . . . . . . . . . . . . . 92
Section 10.05 Guarantors May Consolidate, etc., on
Certain Terms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 93
Section 10.06 Contribution . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 94
Section 10.07 Waiver of Subrogation . . . . . . . . . . . . . . . . . . . . . . . . . . 94
Section 10.08 Execution of Guarantee . . . . . . . . . . . . . . . . . . . . . . . . . 95
Section 10.09 Waiver of Stay, Extension or Usury Laws . . . . . . . . . . . . . . . . . 96
ARTICLE XI
MISCELLANEOUS
Section 11.01 TIA Controls . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 96
Section 11.02 Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 96
Section 11.03 Communications by Holders with Other
Holders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 98
Section 11.04 Certificate and Opinion as to Conditions
Precedent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 98
Section 11.05 Statements Required in Certificate or
Opinion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 98
Section 11.06 Rules by Trustee, Paying Agent, Registrar . . . . . . . . . . . . . . . . 99
Section 11.07 Legal Holidays . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 99
Section 11.08 Governing Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 99
Section 11.09 No Adverse Interpretation of Other
Agreements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 99
Section 11.10 No Recourse Against Others . . . . . . . . . . . . . . . . . . . . . . . 100
Section 11.11 Successors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 100
-iv-
7
Page
----
Section 11.12 Duplicate Originals........................................... 100
Section 11.13 Severability.................................................. 100
Signatures.................................................................... 101
Exhibit A - Form of Series A Security
Exhibit B - Form of Series B Security
Exhibit C - Form of Legend for Global Securities
Exhibit D - Transfer Certificate
Exhibit E - Transferee Certificate for Institutional
Accredited Investors
Exhibit F - Transferee Certificate for Regulation S
Transfers
Note: This Table of Contents shall not, for any purpose, be deemed to be
part of the Indenture.
-v-
8
INDENTURE dated as of July 27, 1995, among WALBRO CORPORATION,
a Delaware corporation (the "Company"), as Issuer, WALBRO AUTOMOTIVE
CORPORATION, a Delaware corporation, WALBRO ENGINE MANAGEMENT CORPORATION, a
Delaware corporation, SHARON MANUFACTURING COMPANY, a Michigan corporation,
WHITEHEAD ENGINEERED PRODUCTS, INC., a Delaware corporation, as Guarantors, and
BANKERS TRUST COMPANY, a New York banking corporation, as Trustee (the
"Trustee").
The Company has duly authorized the creation of an issue of
9-7/8% Senior Notes due 2005, Series A, and 9-7/8% Senior Notes due 2005,
Series B, to be issued in exchange for the 9-7/8% Senior Notes due 2005, Series
A, pursuant to the Registration Rights Agreement and, to provide therefor, the
Company and the Guarantors have duly authorized the execution and delivery of
this Indenture. All things necessary to make the Securities, when duly issued
and executed by the Company and authenticated and delivered hereunder, and the
Guarantees the valid and binding obligations of the Company and the Guarantors,
respectively, and to make this Indenture a valid and binding agreement of the
Company and each of the Guarantors, have been done.
Each party hereto agrees as follows for the benefit of each
other party and for the equal and ratable benefit of the Holders of the
Securities:
ARTICLE I.
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.01 Definitions.
"Acquired Indebtedness" means Indebtedness of a person (a)
assumed in connection with an Asset Acquisition from such person or (b)
existing at the time such person becomes a Subsidiary of any other person.
"Affiliate" means, with respect to any specified person, any
other person directly or indirectly controlling or controlled by or under
direct or indirect common control with such specified person.
"Agent" means any Registrar, Paying Agent or co-Registrar.
9
-2-
"Asset Acquisition" means (a) an Investment by the Company or
any Restricted Subsidiary of the Company in any other person pursuant to which
such person shall become a Restricted Subsidiary of the Company, or shall be
merged with or into the Company or any Restricted Subsidiary of the Company;
(b) the acquisition by the Company or any Restricted Subsidiary of the Company
of the assets of any person (other than a Restricted Subsidiary of the Company)
which constitute all or substantially all of the assets of such person; or (c)
the acquisition by the Company or any Restricted Subsidiary of the Company of
any division or line of business of any person (other than a Restricted
Subsidiary of the Company).
"Asset Sale" means any direct or indirect sale, issuance,
conveyance, transfer, lease or other disposition to any person other than the
Company or a Wholly-Owned Restricted Subsidiary, in one or a series of related
transactions, of (a) any Capital Stock of any Restricted Subsidiary of the
Company (other than in respect of director's qualifying shares or investments
by foreign nationals mandated by applicable law); (b) all or substantially all
of the properties and assets of any division or line of business of the Company
or any Restricted Subsidiary of the Company; or (c) any other properties or
assets of the Company or any Restricted Subsidiary of the Company other than in
the ordinary course of business. For the purposes of this definition, the term
"Asset Sale" shall not include (i) any sale, transfer or other disposition of
equipment, tools or other assets (excluding Capital Stock of any Restricted
Subsidiary of the Company) by the Company or any of its Restricted Subsidiaries
in one or a series of related transactions in respect of which the Company or
such Restricted Subsidiary receives cash or property with an aggregate Fair
Market Value of $5,000,000 or less; (ii) any sale, issuance, conveyance,
transfer, lease or other disposition of properties or assets that is governed
by the provisions described in Section 5.01; and (iii) any sale, transfer or
exchange of Capital Stock of any person other than a Restricted Subsidiary to
the extent proceeds thereof are Capital Stock of such person or its Affiliates.
"Asset Sale Offer" has the meaning provided in Section 4.16.
"Attributable Value" means, as to any particular lease under
which any person is at the time liable other than a Capitalized Lease
Obligation, and at any date as of which the amount thereof is to be determined,
the total net amount of rent required to be paid by such person under such
lease during the initial term thereof as determined in accordance with GAAP,
10
-3-
discounted from the last date of such initial term to the date of determination
at a rate per annum equal to the discount rate which would be applicable to a
Capitalized Lease Obligation with a like term in accordance with GAAP. The net
amount of rent required to be paid under any such lease for any such period
shall be the aggregate amount of rent payable by the lessee with respect to
such period after excluding amounts required to be paid on account of
insurance, taxes, assessments, utility, operating and labor costs and similar
charges. In the case of any lease which is terminable by the lessee upon the
payment of a penalty, such net amount shall also include the amount of such
penalty, but no rent shall be considered as required to be paid under such
lease subsequent to the first date upon which it may be so terminated.
"Attributable Value" means, as to a Capitalized Lease Obligation under which
any person is at the time liable and at any date as of which the amount thereof
is to be determined, the capitalized amount thereof that would appear on the
face of a balance sheet of such person in accordance with GAAP.
"Average Life to Stated Maturity" means, with respect to any
Indebtedness, as at any date of determination, the quotient obtained by
dividing (i) the sum of the products of (a) the number of years (or any
fraction thereof) from such date to the date or dates of each successive
scheduled principal payment (including, without limitation, any sinking fund
requirements) of such Indebtedness multiplied by (b) the amount of each such
principal payment by (ii) the sum of all such principal payments.
"Bankruptcy Law" means Title 11, U.S. Code or any similar
Federal, state or foreign law for the relief of debtors.
"Board of Directors" means, with respect to any person, the
Board of Directors of such person or any committee of the Board of Directors of
such person duly authorized, with respect to any particular matter, to exercise
the power of the Board of Directors of such person.
"Board Resolution" means, with respect to any person, a copy
of a resolution certified by the Secretary or an Assistant Secretary of such
person to have been duly adopted by the Board of Directors of such person and
to be in full force and effect on the date of such certification, and
delivered to the Trustee.
"Business Day" means any day other than a Saturday, Sunday or
any other day on which banking institutions in the City of New York are
required or authorized by law or other governmental action to be closed.
11
-4-
"Capital Stock" means, with respect to any person, any and all
shares, interests, participations, rights in or other equivalents (however
designated) of such person's capital stock, and any rights (other than debt
securities convertible into capital stock), warrants or options exchangeable
for or convertible into such capital stock.
"Capitalized Lease Obligation" means any obligation under a
lease of (or other agreement conveying the right to use) any property (whether
real, personal or mixed) that is required to be classified and accounted for as
a capital lease obligation under GAAP, and, for the purpose of this Indenture,
the amount of such obligation at any date shall be the capitalized amount
thereof at such date, determined in accordance with GAAP.
"Cash Equivalents" means, at any time, (a) any evidence of
Indebtedness with a maturity of 180 days or less issued or directly and fully
guaranteed or insured by the United States of America or any agency or
instrumentality thereof (provided that the full faith and credit of the United
States of America is pledged in support thereof); (b) certificates of deposit
or acceptances with a maturity of 180 days or less of any financial institution
that is a member of the Federal Reserve System having combined capital and
surplus and undivided profits of not less than $500,000,000; (c) certificates
of deposit with a maturity of 180 days or less of any financial institution
that is organized under the laws of the United States, any state thereof or the
District of Columbia that are rated at least A-1 by S&P or at least P-1 by
Moody's or at least an equivalent rating category of another Rating Agency; and
(d) repurchase agreements and reverse repurchase agreements relating to
marketable direct obligations issued or unconditionally guaranteed by the
government of the United States of America or issued by any agency thereof and
backed by the full faith and credit of the United States of America, in each
case maturing within 180 days from the date of acquisition; provided that the
terms of such agreements comply with the guidelines set forth in the Federal
Financial Agreements of Depository Institutions With Securities Dealers and
Others, as adopted by the Comptroller of the Currency on October 31, 1985.
"Change of Control" means the occurrence of any of the
following events: (a) any "person" or "group" (as such terms are used in
Sections 13(d) and 14(d) of the Exchange Act) other than a Permitted Holder or
a group controlled by or comprised of Permitted Holders 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
12
-5-
all securities that such person has the right to acquire, whether such right is
exercisable immediately or only after the passage of time, upon the happening
of an event or otherwise), directly or indirectly, of more than 50% of the
total Voting Stock of the Company; (b) the Company consolidates with, or merges
with or into, another person or sells, assigns, conveys, transfers, leases or
otherwise disposes of all or substantially all of its assets to any person, or
any person consolidates with, or merges with or into, the Company, in any such
event pursuant to a transaction in which the outstanding Voting Stock of the
Company is converted into or exchanged for cash, securities or other property,
other than any such transaction where (i) the outstanding Voting Stock of the
Company is converted into or exchanged for (1) Voting Stock (other than
Redeemable Capital Stock) of the surviving or transferee corporation or (2)
cash, securities and other property in an amount which could then be paid by
the Company as a Restricted Payment under this Indenture, or a combination
thereof, and (ii) immediately after such transaction no "person" or "group" (as
such terms are used in Sections 13(d) and 14(d) of the Exchange Act) other than
a Permitted Holder or a group controlled by or comprised of Permitted Holders
is 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 securities that such person has the right to acquire, whether
such right is exercisable immediately or only after the passage of time, upon
the happening of an event or otherwise), directly or indirectly, of more than
50% of the total Voting Stock of the surviving or transferee corporation; (c)
at any time during any consecutive two-year period, 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 stockholders of the Company was approved
by a vote of a majority 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; or (d) the
Company is liquidated or dissolved or adopts a plan of liquidation.
"Change of Control Date" has the meaning provided in Section
4.15.
"Change of Control Offer" has the meaning provided in Section
4.15.
13
-6-
"Change of Control Purchase Date" has the meaning provided in
Section 4.15.
"Common Stock" means, with respect to any person, any and all
shares, interests or other participations in, and other equivalents (however
designated and whether voting or nonvoting) of, such person's common stock,
whether outstanding on the Issue Date or issued after the Issue Date, and
includes, without limitation, all series and classes of such common stock.
"Company" means the party named as such in this Indenture
until a successor replaces it pursuant to this Indenture and thereafter means
such successor.
"Consolidated Cash Flow Available for Fixed Charges" means,
with respect to any person for any period, the sum of, without duplication, the
amounts for such period, taken as a single accounting period, of (a)
Consolidated Net Income; (b) Consolidated Non-cash Charges; (c) Consolidated
Interest Expense; and (d) Consolidated Income Tax Expense, less any non-cash
items increasing Consolidated Net Income for such period.
"Consolidated Fixed Charge Coverage Ratio" means, with respect
to any person, the ratio of the aggregate amount of Consolidated Cash Flow
Available for Fixed Charges of such person for the four full fiscal quarters
immediately preceding the date of the transaction (the "Transaction Date")
giving rise to the need to calculate the Consolidated Fixed Charge Coverage
Ratio (such four full fiscal quarter period being referred to herein as the
"Four Quarter Period") to the aggregate amount of Consolidated Fixed Charges of
such person for the Four Quarter Period. In addition to and without limitation
of the foregoing, for purposes of this definition, "Consolidated Cash Flow
Available for Fixed Charges" and "Consolidated Fixed Charges" shall be
calculated after giving effect on a pro forma basis for the period of such
calculation to, without duplication, (a) the incurrence of any Indebtedness
(other than revolving credit Indebtedness for working capital purposes) of such
person or any of its Restricted Subsidiaries (and the application of the net
proceeds thereof) during the period commencing on the first day of the Four
Quarter Period to and including the Transaction Date (the "Reference Period"),
including, without limitation, the incurrence of the Indebtedness giving rise
to the need to make such calculation (and the application of the net proceeds
thereof), as if such incurrence (and application) occurred on the first day of
the Reference Period, and (b) any Asset Sales or Asset Acquisitions (including,
without limitation, any Asset
14
-7-
Acquisition giving rise to the need to make such calculation as a result of
such person or one of its Restricted Subsidiaries (including any person who
becomes a Restricted Subsidiary as a result of the Asset Acquisition)
incurring, assuming or otherwise being liable for Acquired Indebtedness)
occurring during the Reference Period, as if such Asset Sale or Asset
Acquisition occurred on the first day of the Reference Period. Furthermore, in
calculating "Consolidated Fixed Charges" for purposes of determining the
denominator (but not the numerator) of this "Consolidated Fixed Charge Coverage
Ratio," (i) interest on outstanding Indebtedness determined on a fluctuating
basis as of the Transaction Date and which will continue to be so determined
thereafter shall be deemed to have accrued at a fixed rate per annum equal to
the rate of interest on such Indebtedness in effect on the Transaction Date;
and (ii) if interest on any Indebtedness actually incurred on the Transaction
Date may optionally be determined at an interest rate based upon a factor of a
prime or similar rate, a eurocurrency interbank offered rate, or other rates,
then the interest rate in effect on the Transaction Date will be deemed to have
been in effect during the Reference Period. If such person or any of its
Restricted Subsidiaries directly or indirectly guarantees Indebtedness of a
third person, the above clause shall give effect to the incurrence of such
guaranteed Indebtedness as if such person or such Restricted Subsidiary had
directly incurred or otherwise assumed such guaranteed Indebtedness.
"Consolidated Fixed Charges" means, with respect to any person
for any period, the sum of, without duplication, the amounts for such period of
(i) Consolidated Interest Expense and (ii) the aggregate amount of dividends
and other distributions paid or accrued during such period in respect of
Preferred Stock and Redeemable Capital Stock of such person and its Restricted
Subsidiaries on a consolidated basis, multiplied by a fraction, the numerator
of which is one and the denominator of which is one minus the then current
federal statutory income tax rate of such person.
"Consolidated Income Tax Expense" means, with respect to any
person for any period, the provision for federal, state, local and foreign
income taxes of such person and its Restricted Subsidiaries for such period as
determined on a consolidated basis in accordance with GAAP.
"Consolidated Interest Expense" means, with respect to any
person for any period, without duplication, the sum of (a) the interest expense
(net of interest income) of such person and its Restricted Subsidiaries for
such period as determined on
15
-8-
a consolidated basis in accordance with GAAP, including, without limitation,
(i) any amortization of debt discount; (ii) the net cost under Interest Rate
Protection Obligations; (iii) the interest portion of any deferred payment
obligation; (iv) all commissions, discounts and other fees and charges owed
with respect to letters of credit and bankers' acceptance financing; and (v)
all accrued interest, and (b) the interest component of Capitalized Lease
Obligations paid, accrued and/or scheduled to be paid or accrued by such person
and its Restricted Subsidiaries during such period as determined on a
consolidated basis in accordance with GAAP.
"Consolidated Net Income" means, with respect to any person,
for any period, the consolidated net income (or loss) of such person and its
Restricted Subsidiaries for such period as determined in accordance with GAAP,
adjusted, to the extent included in calculating such net income, by excluding,
without duplication, (a) all extraordinary gains or losses; (b) the portion of
net income (but not losses) of such person and its Restricted Subsidiaries
allocable to minority interests in unconsolidated persons to the extent that
cash dividends or distributions have not actually been received by such person
or one of its Restricted Subsidiaries; (c) net income (or loss) of any person
combined with such person or one of its Restricted Subsidiaries on a "pooling
of interests" basis attributable to any period prior to the date of
combination; (d) any gain or loss realized upon the termination of any employee
pension benefit plan, on an after-tax basis; (e) gains in respect of any Asset
Sales by such person or one of its Restricted Subsidiaries; and (f) the net
income of any Restricted Subsidiary of such person to the extent that the
declaration of dividends or similar distributions by that Restricted Subsidiary
of that income is not at the time permitted, directly or indirectly, by
operation of the terms of its charter or any agreement, instrument, judgment,
decree, order, statute, rule or governmental regulation applicable to that
Restricted Subsidiary or its stockholders.
"Consolidated Net Worth" means, with respect to any person at
any date, the consolidated stockholders' equity of such person less the amount
of such stockholders' equity attributable to Redeemable Capital Stock of such
person and its Restricted Subsidiaries, as determined in accordance with GAAP.
"Consolidated Non-cash Charges" means, with respect to any
person for any period, the aggregate depreciation, amortization and other
non-cash expenses of such person and its Restricted Subsidiaries reducing
Consolidated Net Income of such person and its Restricted Subsidiaries for such
period,
16
-9-
determined on a consolidated basis in accordance with GAAP (excluding any such
charges constituting an extraordinary item or loss or any such charge which
required an accrual of or a reserve for cash charges for any future period).
"Covenant Defeasance" has the meaning provided in Section 8.01.
"Credit Agreement" means the Credit Agreement dated as of July
26, among the Company, certain of its Subsidiaries, Comerica Bank, in its
individual capacity and as agent, and the other banks which are or become
parties from time to time thereto, and as it may be amended, restated,
supplemented or otherwise modified from time to time, including all exhibits
and schedules thereto, and any successor or replacement facility.
"Currency Agreement" means any foreign exchange contract,
currency swap agreement or other similar agreement or arrangement designed to
protect any person or any of its Restricted Subsidiaries against fluctuations
in currency values.
"Custodian" means any receiver, trustee, assignee, liquidator,
sequestrator or similar official under any Bankruptcy Law.
"Default" means any event that is, or after notice or passage
of time or both would be, an Event of Default.
"Depository" means, with respect to the Securities issued in
the form of one or more Global Securities, The Depository Trust Company or
another person designated as Depository by the Company, which must be a
clearing agency registered under the Exchange Act.
"Event of Default" has the meaning provided in Section 6.01.
"Excess Proceeds" has the meaning provided in Section 4.16.
"Excess Proceeds Payment Date" has the meaning provided in
Section 4.16.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended, or any successor statute or statutes thereto.
"Fair Market Value" means, with respect to any assets, the
price, as determined by the Board of Directors of the
17
-10-
Company, acting in good faith, which could be negotiated in an arm's-length
free market transaction, for cash, between a willing seller and a willing
buyer, neither of which is under pressure or compulsion to complete the
transaction; provided, however, that, with respect to any transaction which
involves an asset or assets in excess of $250,000, such determination shall be
evidenced by a Board Resolution of the Company delivered to the Trustee.
"Final Maturity Date" means July 15, 2005.
"Four Quarter Period" has the meaning provided in the
definition of "Consolidated Fixed Charge Coverage Ratio" above.
"Funding Guarantor" has the meaning provided in Section 10.06.
"GAAP" means generally accepted accounting principles set
forth in the opinions and pronouncements of the Accounting Principles Board of
the American Institute of Certified Public Accountants and statements and
pronouncements of the Financial Accounting Standards Board or in such other
statements by such other entity as may be approved by a significant segment of
the accounting profession of the United States, which are in effect as of the
Issue Date.
"Global Security" means a security evidencing all or a part of
the Securities issued to the Depository in accordance with Section 2.01 and
bearing the legend prescribed in Exhibit C.
"guarantee" means, as applied to any obligation, (i) a
guarantee (other than by endorsement of negotiable instruments for collection
in the ordinary course of business), direct or indirect, in any manner, of any
part or all of such obligation and (ii) an agreement, direct or indirect,
contingent or otherwise, the practical effect of which is to assure in any way
the payment or performance (or payment of damages in the event of
non-performance) of all or any part of such obligation, including, without
limiting the foregoing, the payment of amounts drawn down by letters of credit.
"Guarantee" has the meaning provided in Section 10.01.
"Guarantor" means (a) each of Walbro Automotive Corporation, a
Delaware corporation, Walbro Engine Management Corporation, a Delaware
corporation, Sharon Manufacturing Company, a Michigan corporation, and
Whitehead Engineered Products, Inc., a Delaware corporation; (b) each
Wholly-Owned Restricted Subsidiary of the Company which is incorporated under
18
-11-
the laws of the United States or any state therein or the District of Columbia
which incurs Indebtedness (other than to the Company or a Wholly-Owned
Restricted Subsidiary) in an aggregate principal amount in excess of $5,000,000
for so long as such Wholly-Owned Restricted Subsidiary has Indebtedness
outstanding in excess of $5,000,000; and (c) any other Subsidiary that
guarantees the Securities.
"Holder" or "Securityholder" means a person in whose name a
Security is registered on the Registrar's books.
"incur" has the meaning provided in Section 4.04.
"Indebtedness" means, with respect to any person, without
duplication, (a) all liabilities of such person for borrowed money or for the
deferred purchase price of property or services, excluding any trade payables
and other accrued current liabilities incurred in the ordinary course of
business and which are not overdue by more than 180 days, but including,
without limitation, all obligations, contingent or otherwise, of such person in
connection with any letters of credit, banker's acceptance or other similar
credit transaction; (b) all obligations of such person evidenced by bonds,
notes, debentures or other similar instruments; (c) all indebtedness created or
arising under any conditional sale or other title retention agreement with
respect to property acquired by such person (even if the rights and remedies of
the seller or lender under such agreement in the event of default are limited
to repossession or sale of such property), but excluding trade accounts payable
arising in the ordinary course of business; (d) all Capitalized Lease
Obligations of such person; (e) all Indebtedness referred to in the preceding
clauses of other persons and all dividends of other persons, the payment of
which is secured by (or for which the holder of such Indebtedness has an
existing right, contingent or otherwise, to be secured by) any Lien upon
property (including, without limitation, accounts and contract rights) owned by
such person, even though such person has not assumed or become liable for the
payment of such Indebtedness (the amount of such obligation being deemed to be
the lesser of the value of such property or asset or the amount of the
obligation so secured); (f) all guarantees of Indebtedness referred to in this
definition by such person; (g) all Redeemable Capital Stock of such person
valued at the greater of its voluntary or involuntary maximum fixed repurchase
price plus accrued dividends; (h) all obligations under or in respect of
Currency Agreements and Interest Rate Protection Obligations of such person;
and (i) any amendment, supplement, modification, deferral, renewal, extension
or refunding of any liability of the types referred to in
19
-12-
clauses (a) through (h) above. For purposes hereof, the "maximum fixed
repurchase price" of any Redeemable Capital Stock which does not have a fixed
repurchase price shall be calculated in accordance with the terms of such
Redeemable Capital Stock as if such Redeemable Capital Stock were purchased on
any date on which Indebtedness shall be required to be determined pursuant to
this Indenture, and if such price is based upon, or measured by, the Fair
Market Value of such Redeemable Capital Stock, such Fair Market Value.
"Indenture" means this Indenture, as amended or supplemented
from time to time in accordance with the terms hereof.
"Independent" when used with respect to any specified person
means such a person who (a) is in fact independent; (b) does not have any
direct financial interest or any material indirect financial interest in the
Company or any of its Subsidiaries, or in any Affiliate of the Company or any
of its Subsidiaries; and (c) is not an officer, employee, promoter,
underwriter, trustee, partner, director or person performing similar functions
for the Company or any of its Subsidiaries. Whenever it is provided in this
Indenture that any Independent person's opinion or certificate shall be
furnished to the Trustee, such person shall be appointed by the Company, and
such opinion or certificate shall state that the signer has read this
definition and that the signer is Independent within the meaning hereof.
"Independent Financial Advisor" means a firm (a) which does
not, and whose directors, officers and employees or Affiliates do not, have a
direct or indirect financial interest in the Company or any of its Subsidiaries
and (b) which, in the judgment of the Board of Directors of the Company, is
otherwise independent and qualified to perform the task for which it is to be
engaged.
"Initial Purchasers" means Smith Barney Inc., A.G. Edwards &
Sons, Inc., McDonald & Company Securities, Inc. and Stifel, Nicolaus & Company
Incorporated.
"Institutional Accredited Investor" means an institution that
is an "accredited investor" as that term is defined in Rule 501(a)(1), (2), (3)
or (7) under the Securities Act.
"Interest Payment Date" means the stated maturity of an
installment of interest on the Securities.
20
-13-
"Interest Rate Protection Agreement" means, with respect to
any person, any arrangement with any other person whereby, directly or
indirectly, such person is entitled to receive from time to time periodic
payments calculated by applying either a floating or a fixed rate of interest
on a stated notional amount in exchange for periodic payments made by such
person calculated by applying a fixed or a floating rate of interest on the
same notional amount and shall include without limitation, interest rate swaps,
caps, floors, collars and similar agreements.
"Interest Rate Protection Obligations" means the obligations
of any person pursuant to an Interest Rate Protection Agreement.
"Investment" means, with respect to any person, any direct or
indirect loan or other extension of credit or capital contribution to (by means
of any transfer of cash or other property to others or any payment for
property or services for the account or use of others), or any purchase or
acquisition by such person of any Capital Stock, bonds, notes, debentures or
other securities or evidences of Indebtedness issued by, any other person. In
addition, the Fair Market Value of the assets of any Subsidiary of the Company
at the time that such Subsidiary is designated as an Unrestricted Subsidiary
shall be deemed to be an Investment made by the Company in such Unrestricted
Subsidiary at such time. "Investments" shall exclude extensions of trade
credit by the Company and its Restricted Subsidiaries in the ordinary course of
business in accordance with normal trade practices of the Company or such
Restricted Subsidiary, as the case may be.
"Investment Grade" means, with respect to the Securities, (a)
in the case of S&P, a rating of at least BBB-; (b) in the case of Moody's, a
rating of at least Baa3; and (c) in the case of a Rating Agency other than S&P
or Moody's, the equivalent rating, or in each case, any successor, replacement
or equivalent definition as promulgated by S&P, Moody's or other Rating Agency,
as the case may be; provided that a rating of BBB-, with respect to S&P, Baa3,
with respect to Moody's, or the equivalent rating of another Rating Agency
other than S&P or Moody's (or any such successor, replacement or equivalent
definition) shall not be Investment Grade if any such Rating Agency shall have
then placed the Securities on credit watch with negative implications.
"Issue Date" means the date of first issuance of the
Securities under this Indenture.
21
-14-
"Legal Defeasance" has the meaning provided in Section 8.01.
"Lien" means any mortgage, charge, pledge, lien (statutory or
other), security interest, hypothecation, assignment for security, claim, or
preference or priority or other encumbrance upon or with respect to any
property of any kind. A person shall be deemed to own subject to a Lien any
property which such person has acquired or holds subject to the interest of a
vendor or lessor under any conditional sale agreement, capital lease or other
title retention agreement.
"Moody's" means Moody's Investors Service, Inc. and its
successors.
"Net Cash Proceeds" means, with respect to any Asset Sale, the
proceeds thereof in the form of cash or Cash Equivalents including payments in
respect of deferred payment obligations when received in the form of cash or
Cash Equivalents (except to the extent that such obligations are financed or
sold with recourse to the Company or any Restricted Subsidiary of the Company)
net of (a) brokerage commissions and other fees and expenses (including,
without limitation, fees and expenses of legal counsel and investment bankers)
related to such Asset Sale; (b) provisions for all taxes payable as a result of
such Asset Sale; (c) amounts required to be paid to any person (other than the
Company or any Restricted Subsidiary of the Company) owning a beneficial
interest in the assets subject to the Asset Sale; and (d) appropriate amounts
to be provided by the Company or any Restricted Subsidiary of the Company, as
the case may be, as a reserve required in accordance with GAAP against any
liabilities associated with such Asset Sale and retained by the Company or any
Restricted Subsidiary of the Company, as the case may be, after such Asset
Sale, including, without limitation, pension and other post-employment benefit
liabilities, liabilities related to environmental matters and liabilities under
any indemnification obligations associated with such Asset Sale, all as
reflected in an Officers' Certificate delivered to the Trustee.
"Net Worth" means, with respect to any person at any date, the
stockholders' equity of such person less the amount of such stockholders'
equity attributable to Redeemable Capital Stock of such person, as determined
in accordance with GAAP.
"Non-Investment Grade Period" has the meaning provided in
Section 4.16.
22
-15-
"Note Agreement" means the Note Agreement dated as of October
1, 1994 by and among the Company and the Purchasers named on Schedule I
thereto, relating to the $45,000,000 aggregate principal amount of 7.68% Senior
Notes due October 1, 2004 of the Company.
"Obligations" means all obligations for principal, premium,
interest, penalties, fees, indemnifications, reimbursements, damages and other
liabilities payable under the documentation governing any Indebtedness.
"Offering Memorandum" means the Offering Memorandum of the
Company dated July 21, 1995 with respect to the Series A Securities.
"Officer" means, with respect to any person, the Chairman of
the Board, the Chief Executive Officer, the President, any Vice President, the
Chief Financial Officer, the Controller, or the Secretary of such person.
"Officers' Certificate" means a certificate signed by two
Officers of the Company.
"Opinion of Counsel" means a written opinion from legal
counsel which and who are acceptable to the Trustee.
"Participants" has the meaning provided in Section 2.15.
"Paying Agent" has the meaning provided in Section 2.03.
"Permitted Holder" means (i) each of Lambert A. Althaver,
Robert H. Walpole, Gary L. Vollmar, Richard H. Whitehead, Michael A. Shope and
Daniel L. Hittler; (ii) each spouse, lineal descendant and spouse of a lineal
descendant of a person named in clause (i); and (iii) the estate or legal
representative of a person named in clause (i) or (ii).
"Permitted Investments" means any of the following: (a)
Investments in any Wholly-Owned Restricted Subsidiary (including any person
that pursuant to such Investment becomes a Wholly-Owned Restricted Subsidiary)
and any person that is merged or consolidated with or into, or transfers or
conveys all or substantially all of its assets to, the Company or any
Wholly-Owned Restricted Subsidiary at the time such Investment is made; (b)
Investments in Cash Equivalents; (c) Investments in deposits with respect to
leases or utilities provided to third parties in
23
-16-
the ordinary course of business; (d) Investments in the Securities; (e)
Investments in Currency Agreements on commercially reasonable terms entered
into by the Company or any of its Restricted Subsidiaries in the ordinary
course of business in connection with the operations of the business of the
Company or its Restricted Subsidiaries to hedge against fluctuations in foreign
exchange rates; (f) loans or advances to officers, employees or consultants of
the Company and its Restricted Subsidiaries in the ordinary course of business
for bona fide business purposes of the Company and its Restricted Subsidiaries
(including travel and moving expenses) not in excess of $1,000,000 in the
aggregate at any one time outstanding; (g) Investments in evidences of
Indebtedness, securities or other property received from another person by the
Company or any of its Restricted Subsidiaries in connection with any bankruptcy
proceeding or by reason of a composition or readjustment of debt or a
reorganization of such person or as a result of foreclosure, perfection or
enforcement of any Lien in exchange for evidences of Indebtedness, securities
or other property of such person held by the Company or any of its Restricted
Subsidiaries, or for other liabilities or obligations of such other person to
the Company or any of its Restricted Subsidiaries that were created in
accordance with the terms of this Indenture; (h) Investments in Interest Rate
Protection Agreements on commercially reasonably terms entered into by the
Company or any of its Restricted Subsidiaries in the ordinary course of
business in connection with the operations of the business of the Company or
its Restricted Subsidiaries to hedge against fluctuations in interest rates;
and (i) other Investments made after the Issue Date not to exceed $10,000,000
in the aggregate plus an amount equal to the lesser of the return of capital
with respect to such Investment and the initial amount of such Investment, in
either case, less the cost of the disposition of such Investment.
"Permitted Liens" means the following types of Liens:
(a) Liens for taxes, assessments or governmental charges
or claims either (a) not delinquent or (b) contested in good faith by
appropriate proceedings and as to which the Company or any of its
Restricted Subsidiaries shall have set aside on its books such
reserves as may be required pursuant to GAAP;
(b) statutory Liens of landlords and Liens of carriers,
warehousemen, mechanics, suppliers, materialmen, repairmen and other
Liens imposed by law incurred in the ordinary course of business for
sums not yet delinquent or being contested in good faith, if such
reserve or other
24
-17-
appropriate provision, if any, as shall be required by GAAP shall have
been made in respect thereof;
(c) Liens incurred or deposits made in the ordinary
course of business in connection with workers' compensation,
unemployment insurance and other types of social security, or to
secure the performance of tenders, statutory obligations, surety and
appeal bonds, bids, leases, governmental contracts, performance and
return-of-money bonds and other similar obligations (exclusive of
obligations for the payment of borrowed money);
(d) judgment Liens not giving rise to an Event of Default
so long as such Lien is adequately bonded and any appropriate legal
proceedings which may have been duly initiated for the review of such
judgment shall not have been finally terminated or the period within
which such proceedings may be initiated shall not have expired;
(e) easements, rights-of-way, zoning restrictions and
other similar charges or encumbrances in respect of real property not
interfering in any material respect with the ordinary conduct of the
business of the Company or any of its Restricted Subsidiaries;
(f) any interest or title of a lessor under any
Capitalized Lease Obligation or operating lease;
(g) purchase money Liens to finance the acquisition or
construction of property or assets of the Company or any Restricted
Subsidiary of the Company acquired in the ordinary course of business;
provided, however, that (i) the related purchase money Indebtedness
shall not be secured by any property or assets of the Company or any
Restricted Subsidiary of the Company other than the property and
assets so acquired or construction, (ii) the amount of Indebtedness
secured by any such Lien shall not exceed the purchase price of the
property or assets acquired or constructed and (iii) the Lien securing
such Indebtedness either (x) exists at the time of such acquisition or
construction or (y) shall be created within 90 days of such
acquisition or construction;
(h) other purchase money Liens to finance the acquisition
or construction of property or assets of the Company or any Restricted
Subsidiary of the Company acquired in the ordinary course of business
securing Indebtedness of the Company and its Restricted Subsidiaries
under industrial
25
-18-
revenue bonds or other Indebtedness of the Company and its Restricted
Subsidiaries for which a governmental entity or agency provides direct
or indirect credit support not to exceed $20,000,000 in the aggregate
at any one time outstanding; provided, however, that (i) the amount of
Indebtedness secured by any such Lien shall not exceed 125% of the
purchase price of the property or assets acquired or constructed and
(ii) the Lien securing such Indebtedness either (x) exists at the time
of such acquisition or construction or (y) shall be created within 90
days of such acquisition or construction;
(i) other Liens; provided that at the time any such Lien
is to be incurred, all such Liens incurred pursuant to this clause (i)
secure obligations of the Company and its Restricted Subsidiaries not
to exceed 10% of the Consolidated Net Worth of the Company after
giving pro forma effect to the Lien that is to be incurred; and
(j) Liens in favor of customs and revenue authorities
arising as a matter of law to secure payment of customs duties in
connection with the importation of goods.
"person" means any individual, corporation, limited liability
company, partnership, joint venture, association, joint-stock company, trust,
charitable foundation, unincorporated organization, government or any agency or
political subdivision thereof or any other entity.
"Physical Securities" has the meaning provided in Section 2.01.
"Preferred Stock" means, with respect to any person, any and
all shares, interests, participations or other equivalents (however designated,
whether voting or non-voting) of preferred or preference Capital Stock of such
person.
"principal" of any Indebtedness (including the Securities)
means the principal amount of such Indebtedness plus the premium, if any, on
such Indebtedness.
"Private Placement Legend" means the legend initially set
forth on the Securities in the form set forth on Exhibit A.
"pro forma" means, with respect to any calculation made or
required to be made pursuant to the terms of this Indenture, a calculation in
accordance with Article 11 of Regulation S-X under the Securities Act as
interpreted by the Company's Board of
26
-19-
Directors in consultation with its independent certified public accountants.
"Purchase Agreement" means the purchase agreement dated as of
July 21, 1995 by and among the Company, the Guarantors and the Initial
Purchasers of the Securities.
"Qualified Institutional Buyer" or "QIB" shall have the
meaning specified in Rule 144A under the Securities Act.
"Rating Agency" means a nationally recognized securities
rating agency, selected by the Company and satisfactory to the Trustee.
"Record Date" means the Record Dates specified in the
Securities; provided that if any such date is not a Business Day, the Record
Date shall be the first day immediately preceding such specified day that is a
Business Day.
"Redeemable Capital Stock" means any shares of any class or
series of Capital Stock that, either by the terms thereof, by the terms of any
security into which it is convertible or exchangeable or by contract or
otherwise, is or upon the happening of an event or passage of time would be,
required to be redeemed prior to the Stated Maturity with respect to the
principal of any Security or is redeemable at the option of the holder thereof
at any time prior to any such Stated Maturity, or is convertible into or
exchangeable for debt securities at any time prior to any such Stated Maturity.
"Redemption Date," when used with respect to any Security to
be redeemed, means the date fixed for such redemption pursuant to this
Indenture and the Securities.
"Redemption Price," when used with respect to any Security to
be redeemed, means the price fixed for such redemption, payable in immediately
available funds, pursuant to this Indenture and the Securities.
"Registered Exchange Offer" means the offer to exchange the
Series B Securities for all of the outstanding Series A Securities in
accordance with the Registration Rights Agreement.
"Registrar" has the meaning provided in Section 2.03.
"Registration Rights Agreement" means the Registration Rights
Agreement by and among the Company, the Guarantors and the Initial Purchasers,
relating to the Securities and dated as of
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the Issue Date, as the same may be amended, supplemented or modified from time
to time in accordance with the terms thereof.
"Regulation S" means Regulation S under the Securities Act.
"Replacement Assets" has the meaning provided in Section 4.16.
"Responsible Officer" shall mean, when used with respect to
the Trustee, any officer in the Corporate Trust Office of the Trustee including
any vice president, assistant vice president, assistant secretary, treasurer,
assistant treasurer, or any other officer of the Trustee who customarily
performs functions similar to those performed by the persons who at the time
shall be such officers, respectively, or to whom any corporate trust matter is
referred because of such officer's knowledge of and familiarity with the
particular subject.
"Restricted Payment" has the meaning provided in Section 4.03.
"Restricted Security" has the meaning set forth in Rule
144(a)(3) under the Securities Act; provided that the Trustee shall be entitled
to request and conclusively rely upon an Opinion of Counsel with respect to
whether any Security is a Restricted Security.
"Restricted Subsidiary" means a Subsidiary of any person which
is not an Unrestricted Subsidiary.
"Rule 144A" means Rule 144A under the Securities Act.
"Sale-Leaseback Transaction" of any person means an
arrangement with any lender or investor or to which such lender or investor is
a party providing for the leasing by such person of any property or asset of
such person which has been or is being sold or transferred by such person after
the acquisition thereof or the completion of construction or commencement of
operation thereof to such lender or investor or to any person to whom funds
have been or are to be advanced by such lender or investor on the security of
such property or asset. The stated maturity of such arrangement shall be the
date of the last payment of rent or any other amount due under such arrangement
prior to the first date on which such arrangement may be terminated by the
lessee without payment of a penalty.
"SEC" means the Securities and Exchange Commission.
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"Securities" means the Series A Securities and the Series B
Securities treated as a single class of securities, as amended or supplemented
from time to time in accordance with the terms hereof, that are issued pursuant
to this Indenture.
"Securities Act" means the Securities Act of 1933, as amended,
and the rules and regulations of the SEC promulgated thereunder.
"Series A Securities" means the 9-7/8% Senior Notes due 2005,
Series A, of the Company issued pursuant to this Indenture and sold pursuant to
the Purchase Agreement.
"Series B Securities" means the 9-7/8% Senior Notes due 2005,
Series B, of the Company to be issued in exchange for the Series A Securities
pursuant to the Registered Exchange Offer and the Registration Rights
Agreement.
"Significant Subsidiary" shall have the same meaning as in
Rule 1.02(v) of Regulation S-X under the Securities Act.
"S&P" means Standard & Poor's Ratings Services, a division of
The McGraw-Hill Companies, Inc., and its successors.
"Stated Maturity" means, when used with respect to any
Security or any installment of interest thereon, the date specified in such
Security as the fixed date on which the principal of such Security or such
installment of interest is due and payable, and when used with respect to any
other Indebtedness, means the date specified in the instrument governing such
Indebtedness as the fixed date on which the principal of such Indebtedness, or
any installment of interest thereon, is due and payable.
"Subordinated Indebtedness" means Indebtedness of the Company
or a Guarantor which is expressly subordinated in right of payment to the
Securities or the Guarantee of such Guarantor, as the case may be.
"Subsidiary" means, with respect to any person, (a) a
corporation a majority of whose Voting Stock is at the time, directly or
indirectly, owned by such person, by one or more Subsidiaries of such person or
by such person and one or more Subsidiaries thereof and (b) any other person
(other than a corporation), including, without limitation, a joint venture, in
which such person, one or more Subsidiaries thereof or such person and one or
more Subsidiaries thereof, directly or indirectly, at the date of determination
thereof, has at least
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majority ownership interest entitled to vote in the election of directors,
managers or trustees thereof (or other person performing similar functions).
For purposes of this definition, any directors' qualifying shares or
investments by foreign nationals mandated by applicable law shall be
disregarded in determining the ownership of a Subsidiary.
"Surviving Entity" has the meaning provided in Section 5.01.
"Unrestricted Subsidiary" means a Subsidiary of the Company
(a) none of whose properties or assets were owned by the Company or any of its
Subsidiaries on or prior to the Issue Date, other than any such assets as are
transferred to such Unrestricted Subsidiary in accordance with Section 4.03;
(b) whose properties and assets, to the extent that they secure Indebtedness,
secure only Non-Recourse Indebtedness; and (c) which has no Indebtedness other
than Non-Recourse Indebtedness. As used above, "Non-Recourse Indebtedness"
means Indebtedness as to which (i) neither the Company nor any of its
Restricted Subsidiaries (1) provides credit support (including any undertaking,
agreement or instrument which would constitute Indebtedness), (2) guarantees or
is otherwise directly or indirectly liable or (3) constitutes the lender (in
each case, other than pursuant to and in compliance with Section 4.03) and (ii)
no default with respect to such Indebtedness (including any rights which the
holders thereof may have to take enforcement action against the relevant
Unrestricted Subsidiary or its assets) would permit (upon notice, lapse of time
or both) any holder of any other Indebtedness of the Company or its Restricted
Subsidiaries to declare a default on such other Indebtedness or cause the
payment thereof to be accelerated or payable prior to its stated maturity. The
Company shall not be permitted to designate any Unrestricted Subsidiary as a
Restricted Subsidiary unless, after giving pro forma effect to such
designation, (i) the Company would be permitted to incur $1.00 of additional
Indebtedness pursuant to the first paragraph of Section 4.04 (assuming a market
rate of interest with respect to such Indebtedness) and (ii) all Indebtedness
and Liens of such Unrestricted Subsidiary would be permitted to be incurred by
a Restricted Subsidiary of the Company under this Indenture. An Unrestricted
Subsidiary shall not be designated as a Restricted Subsidiary unless the
Company shall have provided written notice to the Trustee as to compliance with
this Indenture. A designation of an Unrestricted Subsidiary as a Restricted
Subsidiary may not thereafter be rescinded.
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"TIA" means the Trust Indenture Act of 1939 (15 U.S.C.
Sections 77aaa-77bbbb), as amended, as in effect on the date of the execution of
this Indenture until such time as this Indenture is qualified under the TIA, and
thereafter as in effect on the date on which this Indenture is qualified under
the TIA, except as otherwise provided in Section 9.03.
"Trustee" means the party named as such in this Indenture
until a successor replaces it in accordance with the provisions of this
Indenture and thereafter means such successor.
"U.S. Government Obligations" shall have the meaning provided
in Section 8.01.
"U.S. Legal Tender" means such coin or currency of the United
States of America as at the time of payment shall be legal tender for the
payment of public and private debts.
"U.S. Physical Securities" shall have the meaning set forth in
Section 2.01.
"Voting Stock" means any class or classes of Capital Stock
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,
managers or trustees of any person (irrespective of whether or not, at the
time, Capital Stock of any other class or classes shall have, or might have,
voting power by reason of the happening of any contingency).
"Wholly-Owned Restricted Subsidiary" means any Restricted
Subsidiary of the Company of which 100% of the outstanding Capital Stock is
owned by the Company or one or more Wholly-Owned Restricted Subsidiaries or by
the Company and one or more Wholly-Owned Restricted Subsidiaries. For purposes
of this definition, any directors' qualifying shares or investments by foreign
nationals mandated by applicable law shall be disregarded in determining the
ownership of a Subsidiary.
SECTION 1.02 Incorporation by Reference of TIA.
Whenever this Indenture refers to a provision of the TIA, such
provision is incorporated by reference in, and made a part of, this Indenture.
The following TIA terms used in this Indenture have the following meanings:
"Commission" means the SEC.
"indenture securities" means the Securities.
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"indenture security holder" means a Holder or a Securityholder.
"indenture to be qualified" means this Indenture.
"indenture trustee" or "institutional trustee" means the
Trustee.
"obligor" on the indenture securities means the Company, any
Guarantor or any other obligor on the Securities.
All other TIA terms used in this Indenture that are defined by
the TIA, defined by TIA reference to another statute or defined by SEC rule and
not otherwise defined herein have the meanings assigned to them therein.
SECTION 1.03 Rules of Construction.
Unless the context otherwise requires:
(1) a term has the meaning assigned to it;
(2) an accounting term not otherwise defined has the
meaning assigned to it in accordance with GAAP;
(3) "or" is not exclusive;
(4) words in the singular include the plural, and words
in the plural include the singular;
(5) provisions apply to successive events and
transactions; and
(6) "herein," "hereof" and other words of similar import
refer to this Indenture as a whole and not to any particular Article, Section
or other subdivision.
ARTICLE II.
THE SECURITIES
SECTION 2.01 Form and Dating.
The Series A Securities and the Trustee's certificate of
authentication thereof shall be substantially in the form of
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Exhibit A annexed hereto, which is hereby incorporated in and expressly made a
part of this Indenture. The Series B Securities and the Trustee's certificate
of authentication thereof shall be substantially in the form of Exhibit B
annexed hereto, which is hereby incorporated in and expressly made a part of
this Indenture. The Securities may have notations, legends or endorsements
(including notations relating to the Guarantee) required by law, stock exchange
rule or usage. The Company and the Trustee shall approve the form of the
Securities and any notation, legend or endorsement (including notations
relating to the Guarantee) on them. Each Security shall be dated the date of
its issuance and shall show the date of its authentication.
Securities offered and sold in reliance on Rule 144A shall be
issued initially in the form of one or more permanent Global Securities in
registered form, substantially in the form set forth in Exhibit A, deposited
with the Trustee, as custodian for the Depository, and shall bear the legend
set forth on Exhibit C. The aggregate principal amount of any Global Security
may from time to time be increased or decreased by adjustments made on the
records of the Trustee, as custodian for the Depository, as hereinafter
provided.
Securities offered and sold in offshore transactions in
reliance on Regulation S shall be issued in the form of certificated Securities
in registered form set forth in Exhibit A (the "Offshore Physical Securities").
Securities offered and sold in reliance on any other exemption from
registration under the Securities Act other than as described in the preceding
paragraph shall be issued, and Securities offered and sold in reliance on Rule
144A may be issued, in the form of certificated Securities in registered form
in substantially the form set forth in Exhibit A (the "U.S. Physical
Securities"). The Offshore Physical Securities and the U.S. Physical
Securities are sometimes collectively herein referred to as the "Physical
Securities."
SECTION 2.02 Execution and Authentication.
Two Officers, or an Officer and an Assistant Secretary, shall
sign, or one Officer shall sign and one Officer or an Assistant Secretary (each
of whom shall, in each case, have been duly authorized by all requisite
corporate actions) shall attest to, the Securities for the Company by manual or
facsimile signature. The Company's seal shall also be reproduced on the
Securities.
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If an Officer or Assistant Secretary whose signature is on a
Security was an Officer or Assistant Secretary at the time of such execution
but no longer holds that office at the time the Trustee authenticates the
Security, the Security shall be valid nevertheless. Each Guarantor shall
execute the Guarantee in the manner set forth in Section 10.08.
A Security shall not be valid until an authorized signatory of
the Trustee manually signs the certificate of authentication on the Security.
The signature shall be conclusive evidence that the Security has been
authenticated under this Indenture.
The Trustee shall authenticate (i) Series A Securities for
original issue in the aggregate principal amount not to exceed $110,000,000 and
(ii) Series B Securities from time to time for issue only in exchange for a
like principal amount of Series A Securities, in each case upon a written order
of the Company in the form of an Officers' Certificate. The Officers'
Certificate shall specify the amount of Securities to be authenticated, the
series of Securities and the date on which the Securities are to be
authenticated. The aggregate principal amount of Securities outstanding at any
time may not exceed $110,000,000, except as provided in Section 2.07. Upon
receipt of a written order of the Company in the form of an Officers'
Certificate, the Trustee shall authenticate Securities in substitution for
Securities originally issued to reflect any name change of the Company.
The Trustee may appoint an authenticating agent reasonably
acceptable to the Company to authenticate Securities. Unless otherwise
provided in the appointment, an authenticating agent may authenticate
Securities whenever the Trustee may do so. Each reference in this Indenture to
authentication by the Trustee includes authentication by such agent. An
authenticating agent has the same rights as an Agent to deal with the Company
and Affiliates of the Company.
The Securities shall be issuable only in registered form
without coupons in denominations of $1,000 and any integral multiple thereof.
SECTION 2.03 Registrar and Paying Agent.
The Company shall maintain an office or agency in the Borough
of Manhattan, The City of New York, where (a) Securities may be presented or
surrendered for registration of transfer or for exchange ("Registrar"), (b)
Securities may be presented or
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surrendered for payment ("Paying Agent") and (c) notices and demands in respect
of the Securities and this Indenture may be served. The Registrar shall keep a
register of the Securities and of their transfer and exchange. The Company,
upon written notice to the Trustee, may have one or more co-Registrars and one
or more additional Paying Agents reasonably acceptable to the Trustee. The
term "Paying Agent" includes any additional Paying Agent. The Company
initially appoints the Trustee as Registrar and Paying Agent until such time as
the Trustee has resigned or a successor has been appointed. Neither the
Company nor any Affiliate of the Company may act as Paying Agent except as
otherwise expressly provided in the form of the Security.
To the extent the Company makes such payments directly to the
Holders, the Company shall simultaneously notify the Trustee thereof in
writing.
SECTION 2.04 Paying Agent To Hold Assets in Trust.
The Company shall require each Paying Agent other than the
Trustee to agree in writing that each Paying Agent shall hold in trust for the
benefit of Holders or the Trustee all assets held by the Paying Agent for the
payment of principal of, or interest on, the Securities, and shall notify the
Trustee in writing of any Default by the Company in making any such payment.
The Company at any time may require a Paying Agent to distribute all assets
held by it to the Trustee and account for any assets disbursed and the Trustee
may at any time, but shall be under no obligation to, during the continuance of
any payment Default, upon written request to a Paying Agent, require such
Paying Agent to distribute all assets held by it to the Trustee and to account
for any assets distributed. Upon distribution to the Trustee of all assets
that shall have been delivered by the Company to the Paying Agent, the Paying
Agent shall have no further liability for such assets.
SECTION 2.05 Securityholder Lists.
The Trustee shall preserve in as current a form as is
reasonably practicable the most recent list available to it of the names and
addresses of Holders. If the Trustee is not the Registrar, the Company shall
furnish to the Trustee before each Record Date and at such other times as the
Trustee may request in writing a list as of such date and in such form as the
Trustee may reasonably require of the names and addresses of Holders, which
list may be conclusively relied upon by the Trustee.
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SECTION 2.06 Transfer and Exchange.
Subject to the provisions of Sections 2.15 and 2.16, when
Securities are presented to the Registrar or a co-Registrar with a request to
register the transfer of such Securities or to exchange such Securities for an
equal principal amount of Securities of other authorized denominations of the
same series, the Registrar or co-Registrar shall register the transfer or make
the exchange as requested if its requirements for such transaction are met;
provided, however, that the Securities surrendered for transfer or exchange
shall be duly endorsed or accompanied by a written instrument of transfer in
form satisfactory to the Company and the Registrar or co-Registrar, duly
executed by the Holder thereof or his attorney duly authorized in writing. To
permit registrations of transfers and exchanges, the Company shall execute and
the Trustee shall authenticate Securities at the Registrar's or co-Registrar's
written request. No service charge shall be made for any registration of
transfer or exchange, but the Company may require payment of a sum sufficient
to cover any transfer tax or similar governmental charge payable in connection
therewith (other than any such transfer taxes or other governmental charge
payable upon exchanges or transfers pursuant to Section 2.02, 2.10, 3.06, 4.15,
4.16 or 9.05). The Registrar or co-Registrar shall not be required to register
the transfer of or exchange of any Security (i) during a period beginning at
the opening of business 15 days before the mailing of a notice of redemption of
Securities and ending at the close of business on the day of such mailing and
(ii) selected for redemption in whole or in part pursuant to Article Three,
except the unredeemed portion of any Security being redeemed in part.
Any Holder of a Global Security shall, by acceptance of such
Global Security, agree that transfers of beneficial interests in such Global
Security may be effected only through a book-entry system maintained by the
Depository (or its agent), and that ownership of a beneficial interest in a
Global Security shall be required to be reflected in a book entry system.
SECTION 2.07 Replacement Securities.
If a mutilated Security is surrendered to the Trustee or if
the Holder of a Security claims that the Security has been lost, destroyed or
wrongfully taken, the Company shall issue and the Trustee shall authenticate
upon written notice from the Company a replacement Security if the Trustee's
requirements are met. If required by the Trustee or the Company, such Holder
must provide an indemnity bond or other indemnity, sufficient in the
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judgment of both the Company and the Trustee, to protect the Company, the
Trustee and any Agent from any loss which any of them may suffer if a Security
is replaced. The Company may charge such Holder for its reasonable,
out-of-pocket expenses in replacing a Security, including reasonable fees and
expenses of counsel.
Every replacement Security is an additional obligation of the
Company.
SECTION 2.08 Outstanding Securities.
Securities outstanding at any time are all the Securities that
have been authenticated by the Trustee except those cancelled by it, those
delivered to it for cancellation and those described in this Section as not
outstanding. Subject to Section 2.09, a Security does not cease to be
outstanding because the Company or any of its Affiliates holds the Security.
If a Security is replaced pursuant to Section 2.07 (other than
a mutilated Security surrendered for replacement), it ceases to be outstanding
unless the Trustee receives proof satisfactory to it that the replaced Security
is held by a bona fide purchaser. A mutilated Security ceases to be
outstanding upon surrender of such Security and replacement thereof pursuant to
Section 2.07.
If on a Redemption Date or the Final Maturity Date the Paying
Agent holds U.S. Legal Tender or U.S. Government Obligations sufficient to pay
all of the principal and interest due on the Securities payable on that date,
then on and after that date such Securities cease to be outstanding and
interest on them ceases to accrue.
SECTION 2.09 Treasury Securities.
In determining whether the Holders of the required principal
amount of Securities have concurred in any direction, waiver or consent,
Securities owned by the Company, the Guarantors or any of their respective
Affiliates shall be disregarded, except that, for the purposes of determining
whether the Trustee shall be protected in relying on any such direction, waiver
or consent, only Securities that a Responsible Officer of the Trustee actually
knows are so owned shall be disregarded.
The Trustee may require an Officers' Certificate listing
Securities owned by the Company, a Guarantor or any of their respective
Affiliates.
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SECTION 2.10 Temporary Securities.
Until definitive Securities are ready for delivery, the
Company may prepare and the Trustee shall authenticate temporary Securities
upon receipt of a written order of the Company in the form of an Officers'
Certificate. The Officers' Certificate shall specify the amount of temporary
Securities to be authenticated and the date on which the temporary Securities
are to be authenticated. Temporary Securities shall be substantially in the
form of definitive Securities but may have variations that the Company
considers appropriate for temporary Securities. Without unreasonable delay,
the Company shall prepare and the Trustee shall authenticate upon receipt of a
written order of the Company pursuant to Section 2.02 definitive Securities in
exchange for temporary Securities.
SECTION 2.11 Cancellation.
The Company at any time may deliver Securities to the Trustee
for cancellation. The Registrar and the Paying Agent shall forward to the
Trustee any Securities surrendered to them for transfer, exchange or payment.
The Trustee, or at the direction of the Trustee, the Registrar or the Paying
Agent, and no one else, shall cancel and, at the written direction of the
Company, shall dispose of all Securities surrendered for transfer, exchange,
payment or cancellation. Subject to Section 2.07, the Company may not issue
new Securities to replace Securities that it has paid or delivered to the
Trustee for cancellation. If the Company or any Guarantor shall acquire any
of the Securities, such acquisition shall not operate as a redemption or
satisfaction of the Indebtedness represented by such Securities unless and
until the same are surrendered to the Trustee for cancellation pursuant to this
Section 2.11.
SECTION 2.12 Defaulted Interest.
If the Company defaults in a payment of interest on the
Securities, it shall pay interest on overdue principal and on overdue
installments of interest (without grace periods) from time to time on demand at
the rate of 2% per annum in excess of the rate shown on the Security.
SECTION 2.13 CUSIP Number.
The Company in issuing the Securities will use a "CUSIP"
number, and if so, the Trustee shall use the CUSIP number in notices of
redemption or exchange as a convenience to Holders; provided that any such
notice may state that no representation is
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made as to the correctness or accuracy of the CUSIP number printed in the
notice or on the Securities, and that reliance may be placed only on the other
identification numbers printed on the Securities.
SECTION 2.14 Deposit of Moneys.
Prior to 11:00 a.m. New York City time on each Interest
Payment Date and the Final Maturity Date, the Company shall have either
delivered by wire transfer or check such interest or principal and interest, as
the case may be to Holders at such Holders registered address or deposited with
the Paying Agent in immediately available funds money sufficient to make cash
payments, if any, due on such Interest Payment Date or the Final Maturity Date,
as the case may be, in a timely manner which permits the Paying Agent to remit
payment to the Holders on such Interest Payment Date or the Final Maturity
Date, as the case may be.
SECTION 2.15 Book-Entry Provisions for Global Securities.
(a) The Global Securities initially shall (i) be
registered in the name of the Depository or the nominee of such Depository,
(ii) be delivered to the Trustee as custodian for such Depository and (iii)
bear legends as set forth in Exhibit C.
Members of, or participants in, the Depository
("Participants") shall have no rights under this Indenture with respect to any
Global Security held on their behalf by the Depository, or the Trustee as its
custodian, or under the Global Security, and the Depository may be treated by
the Company, the Trustee and any agent of the Company or the Trustee as the
absolute owner of the Global Security for all purposes whatsoever.
Notwithstanding the foregoing, nothing herein shall prevent the Company, the
Trustee or any agent of the Company or the Trustee from giving effect to any
written certification, proxy or other authorization furnished by the Depository
or impair, as between the Depository and Participants, the operation of
customary practices governing the exercise of the rights of a Holder of any
Security.
(b) Transfers of Global Securities shall be limited to
transfers in whole, but not in part, to the Depository, its successors or their
respective nominees. Interests of beneficial owners in the Global Securities
may be transferred or exchanged for Physical Securities in accordance with the
rules and procedures of the Depository and the provisions of Section 2.16. In
addition, Physical Securities shall be transferred to all
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beneficial owners in exchange for their beneficial interests in Global
Securities if (i) the Depository notifies the Company that it is unwilling or
unable to continue as Depository for any Global Security and a successor
depositary is not appointed by the Company within 90 days of such notice or
(ii) an Event of Default has occurred and is continuing and the Registrar has
received a request from the Depository to issue Physical Securities.
(c) In connection with the transfer of Global Securities
as an entirety to beneficial owners pursuant to paragraph (b) of this Section
2.15, the Global Securities shall be deemed to be surrendered to the Trustee
for cancellation, and the Company shall execute, and the Trustee shall upon
written instructions from the Company authenticate and deliver, to each
beneficial owner identified by the Depository in exchange for its beneficial
interest in the Global Securities, an equal aggregate principal amount of
Physical Securities of authorized denominations.
(d) Any Physical Security constituting a Restricted
Security delivered in exchange for an interest in a Global Security pursuant to
paragraph (b) or (d) of this Section 2.15 shall, except as otherwise provided
by Section 2.16, bear the Private Placement Legend.
(e) The Holder of any Global Security may grant proxies
and otherwise authorize any person, including Participants and persons that may
hold interests through Participants, to take any action which a Holder is
entitled to take under this Indenture or the Securities.
SECTION 2.16 Registration of Transfers and Exchanges.
(a) Transfer and Exchange of Physical Securities. When
Physical Securities are presented to the Registrar with a request:
(i) to register the transfer of the Physical Securities;
or
(ii) to exchange such Physical Securities for an equal
number of Physical Securities of other authorized
denominations,
the Registrar shall register the transfer or make the exchange as requested if
the requirements under this Indenture as set forth in this Section 2.16 for
such transactions are met; provided,
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however, that the Physical Securities presented or surrendered for registration
of transfer or exchange:
(I) shall be duly endorsed or accompanied by a written
instrument of transfer in form satisfactory to the
Registrar or co-Registrar, duly executed by the
Holder thereof or his attorney duly authorized in
writing; and
(II) in the case of Physical Securities the offer and sale
of which have not been registered under the
Securities Act, such Physical Securities shall be
accompanied, in the sole discretion of the Company,
by the following additional information and
documents, as applicable:
(A) if such Physical Security is being delivered
to the Registrar by a holder for registration
in the name of such holder, without transfer,
a certification from such holder to that
effect (in substantially the form of Exhibit
D hereto); or
(B) if such Physical Security is being
transferred to a Qualified Institutional
Buyer in accordance with Rule 144A under the
Securities Act, a certification to that
effect (in substantially the form of Exhibit
D hereto); or
(C) if such Physical Security is being
transferred to an Institutional Accredited
Investor, delivery of a certification to that
effect (in substantially the form of Exhibit
D hereto) and a Transferee Certificate for
Institutional Accredited Investors in the
form of Exhibit E hereto; or
(D) if such Physical Security is being
transferred in reliance on Regulation S,
delivery of a certification to that effect
(substantially in the form of Exhibit D
hereto) and a Transferee Certificate for
Regulation S Transfers in the form of Exhibit
F hereto and an Opinion of Counsel reasonably
satisfactory to the Company to the effect
that such transfer is in compliance with the
Securities Act; or
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(E) if such Physical Security is being
transferred in reliance on Rule 144 under the
Securities Act, delivery of a certification
to that effect (substantially in the form of
Exhibit D hereto) and an Opinion of Counsel
reasonably satisfactory to the Company to the
effect that such transfer is in compliance
with the Securities Act; or
(F) if such Physical Security is being
transferred in reliance on another exemption
from the registration requirements of the
Securities Act, a certification to that
effect (in substantially the form of Exhibit
D hereto) and an Opinion of Counsel
reasonably acceptable to the Company to the
effect that such transfer is in compliance
with the Securities Act.
(b) Restrictions on Transfer of a Physical Security for a
Beneficial Interest in a Global Security. A Physical Security may not be
exchanged for a beneficial interest in a Global Security except upon
satisfaction of the requirements set forth below. Upon receipt by the
Registrar of a Physical Security, duly endorsed or accompanied by appropriate
instruments of transfer, in form satisfactory to the Registrar, together with:
(A) certification, substantially in the form of Exhibit D
hereto, that such Physical Security is being
transferred to a Qualified Institutional Buyer; and
(B) written instructions directing the Registrar to make,
or to direct the Depository to make, an endorsement
on the Global Security to reflect an increase in the
aggregate amount of the Securities represented by the
Global Security,
then the Registrar shall cancel such Physical Security and cause, or direct the
Depository to cause, in accordance with the standing instructions and
procedures existing between the Depository and the Registrar, the number of
Securities represented by the Global Security to be increased accordingly. If
no Global Security is then outstanding, the Company shall issue and the Trustee
shall upon written instructions from the Company authenticate a new Global
Security in the appropriate amount.
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(c) Transfer and Exchange of Global Securities. The
transfer and exchange of Global Securities or beneficial interests therein
shall be effected through the Depository, in accordance with this Indenture
(including the restrictions on transfer set forth herein) and the procedures of
the Depository therefor.
(d) Transfer of a Beneficial Interest in a Global
Security for a Physical Security.
(i) Any person having a beneficial interest in a Global
Security may upon request exchange such beneficial
interest for a Physical Security. Upon receipt by
the Registrar of written instructions or such other
form of instructions as is customary for the
Depository from the Depository or its nominee on
behalf of any person having a beneficial interest in
a Global Security and upon receipt by the Trustee of
a written order or such other form of instructions as
is customary for the Depository or the person
designated by the Depository as having such a
beneficial interest containing registration
instructions and, in the case of any such transfer
or exchange of a beneficial interest in Securities
the offer and sale of which have not been registered
under the Securities Act, the following additional
information and documents:
(A) if such beneficial interest is being
transferred to the person designated by the
Depository as being the beneficial owner, a
certification from such person to that effect
(in substantially the form of Exhibit D
hereto); or
(B) if such beneficial interest is being
transferred to a Qualified Institutional
Buyer in accordance with Rule 144A under the
Securities Act, a certification to that
effect (in substantially the form of Exhibit
D hereto); or
(C) if such beneficial interest is being
transferred to an Institutional Accredited
Investor, delivery of a certification to that
effect (substantially in the form of Exhibit
D hereto) and a Certificate for Institutional
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Accredited Investors in the form of Exhibit E
hereto; or
(D) if such beneficial interest is being
transferred in reliance on Regulation S,
delivery of a certification to that effect
(substantially in the form of Exhibit D
hereto) and a Transferee Certificate for
Regulation S Transfers in the form of Exhibit
F hereto and an Opinion of Counsel reasonably
satisfactory to the Company to the effect
that such transfer is in compliance with the
Securities Act; or
(E) if such beneficial interest is being
transferred in reliance on Rule 144 under the
Securities Act, delivery of a certification
to that effect (substantially in the form of
Exhibit D hereto) and an Opinion of Counsel
reasonably acceptable to the Company to the
effect that such transfer is in compliance
with the Securities Act; or
(F) if such beneficial interest is being
transferred in reliance on another exemption
from the registration requirements of the
Securities Act, a certification to that
effect (in substantially the form of Exhibit
D hereto) and an Opinion of Counsel
reasonably acceptable to the Company to the
effect that such transfer is in compliance
with the Securities Act,
then the Registrar will cause, in accordance with the
standing instructions and procedures existing between
the Depository and the Registrar, the aggregate
amount of the Global Security to be reduced and,
following such reduction, the Company will execute
and, upon receipt of an authentication order in the
form of an Officers' Certificate, the Trustee will
authenticate and deliver to the transferee a Physical
Security.
(ii) Securities issued in exchange for a beneficial
interest in a Global Security pursuant to this
Section 2.16(d) shall be registered in such names and
in such authorized denominations as the Depository,
pursuant to instructions from its
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direct or indirect participants or otherwise, shall
instruct the Registrar in writing. The Registrar
shall deliver such Physical Securities to the persons
in whose names such Physical Securities are so
registered.
(e) Restrictions on Transfer and Exchange of Global
Securities. Notwithstanding any other provisions of this Indenture, a Global
Security may not be transferred as a whole except by the Depository to a
nominee of the Depository or by a nominee of the Depository to the Depository
or another nominee of the Depository or by the Depository or any such nominee
to a successor Depository or a nominee of such successor Depository.
(f) Private Placement Legend. Upon the transfer, exchange or
replacement of Securities not bearing the Private Placement Legend, the
Registrar shall deliver Securities that do not bear the Private Placement
Legend. Upon the transfer, exchange or replacement of Securities bearing the
Private Placement Legend, the Registrar shall deliver only Securities that bear
the Private Placement Legend unless, and the Trustee is hereby authorized to
deliver Securities without the Private Placement Legend if, (i) there is
delivered to the Trustee an Opinion of Counsel reasonably satisfactory to the
Company and the Trustee to the effect that neither such legend nor the related
restrictions on transfer are required in order to maintain compliance with the
provisions of the Securities Act or (ii) such Security has been sold pursuant
to an effective registration statement under the Securities Act.
(g) General. By its acceptance of any Security bearing the
Private Placement Legend, each Holder of such a Security acknowledges the
restrictions on transfer of such Security set forth in this Indenture and in
the Private Placement Legend and agrees that it will transfer such Security
only as provided in this Indenture.
The Registrar shall retain copies of all letters, notices and
other written communications received pursuant to Section 2.15 or this Section
2.16. The Company shall have the right to inspect and make copies of all such
letters, notices or other written communications at any reasonable time upon
the giving of reasonable written notice to the Registrar.
SECTION 2.17 Designation.
The Indebtedness evidenced by the Securities is hereby
irrevocably designated as "senior indebtedness" or such other
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term denoting seniority for the purposes of any future Indebtedness of the
Company which the Company makes subordinate to any senior indebtedness or such
other term denoting seniority.
ARTICLE III.
REDEMPTION
SECTION 3.01 Notices to Trustee.
If the Company elects to redeem Securities pursuant to
Paragraph 5 or Paragraph 6 of the Securities, it shall notify the Trustee in
writing of the Redemption Date, the Redemption Price and the principal amount
of Securities to be redeemed. The Company shall give notice of redemption to
Trustee at least 30 days but not more than 60 days before the Redemption Date
(unless a shorter notice shall be agreed to by the Trustee in writing),
together with an Officers' Certificate stating that such redemption will comply
with the conditions contained herein.
SECTION 3.02 Selection of Securities To Be Redeemed.
If fewer than all of the Securities are to be redeemed, the
Trustee shall select the Securities to be redeemed in compliance with the
requirements of the principal national securities exchange, if any, on which
the Securities are listed or, if the Securities are not listed on a national
securities exchange, by lot or by such method as the Trustee shall deem fair
and appropriate; provided, however, that if the Securities are redeemed
pursuant to Paragraph 6 of the Securities, the Securities shall be redeemed
solely on a pro rata basis unless the securities exchange, if any, on which the
Securities are listed requires a different method. If the Securities are
listed on any national securities exchange, the Company shall notify the
Trustee in writing of the requirements of such exchange in respect of any
redemption. The Trustee shall make the selection from the Securities
outstanding and not previously called for redemption and shall promptly notify
the Company in writing of the Securities selected for redemption and, in the
case of any Security selected for partial redemption, the principal amount
thereof to be redeemed. Securities in denominations of less than $1,000 may be
redeemed only in whole. The Trustee may select for redemption portions (equal
to $1,000 or any integral multiple thereof) of the principal of Securities that
have denominations larger than $1,000. Provisions of this Indenture that apply
to
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Securities called for redemption also apply to portions of Securities called
for redemption.
SECTION 3.03 Notice of Redemption.
At least 30 days but not more than 60 days before a Redemption
Date, the Company shall mail or cause to be mailed a notice of redemption by
first class mail, postage prepaid, to each Holder whose Securities are to be
redeemed. At the Company's written request, the Trustee shall give the notice
of redemption in the Company's name and at the Company's expense. Each notice
for redemption shall identify the Securities to be redeemed and shall state:
(1) the Redemption Date;
(2) the Redemption Price and the amount of accrued interest, if
any, to be paid;
(3) the name and address of the Paying Agent;
(4) that Securities called for redemption must be surrendered to
the Paying Agent to collect the Redemption Price plus accrued interest, if any;
(5) that, unless the Company defaults in making the redemption
payment, interest on Securities called for redemption ceases to accrue on and
after the Redemption Date, and the only remaining right of the Holders of such
Securities is to receive payment of the Redemption Price upon surrender to the
Paying Agent of the Securities redeemed;
(6) if any Security is being redeemed in part, the portion of the
principal amount of such Security to be redeemed and that, after the Redemption
Date, and upon surrender of such Security, a new Security or Securities in
aggregate principal amount equal to the unredeemed portion thereof will be
issued;
(7) if fewer than all the Securities are to be redeemed, the
identification of the particular Securities (or portion thereof) to be
redeemed, as well as the aggregate principal amount of Securities to be
redeemed and the aggregate principal amount of Securities to be outstanding
after such partial redemption; and
(8) the Paragraph of the Securities pursuant to which the
Securities are to be redeemed.
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SECTION 3.04 Effect of Notice of Redemption.
Once notice of redemption is mailed in accordance with Section
3.03, Securities called for redemption become due and payable on the Redemption
Date and at the Redemption Price plus accrued interest, if any. Upon surrender
to the Paying Agent, such Securities called for redemption shall be paid at the
Redemption Price (which shall include accrued interest thereon to the
Redemption Date), but installments of interest, the maturity of which is on or
prior to the Redemption Date, shall be payable to Holders of record at the
close of business on the relevant Record Dates.
SECTION 3.05 Deposit of Redemption Price.
On or before the Redemption Date, the Company shall deposit
with the Paying Agent U.S. Legal Tender sufficient to pay the Redemption Price
plus accrued interest, if any, of all Securities to be redeemed on that date.
If the Company complies with the preceding paragraph, then,
unless the Company defaults in the payment of such Redemption Price plus
accrued interest, if any, interest on the Securities to be redeemed will cease
to accrue on and after the applicable Redemption Date, whether or not such
Securities are presented for payment.
SECTION 3.06 Securities Redeemed in Part.
Upon surrender of a Security that is to be redeemed in part,
the Trustee shall upon written instruction from the Company authenticate for
the Holder a new Security or Securities equal in principal amount to the
unredeemed portion of the Security surrendered.
ARTICLE IV.
COVENANTS
SECTION 4.01 Payment of Securities.
The Company shall pay the principal of and interest on the
Securities in the manner provided in the Securities. An installment of
principal of or interest on the Securities shall be considered paid on the date
it is due if the Trustee or Paying
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Agent holds on that date U.S. Legal Tender designated for and sufficient to pay
the installment.
The Company shall pay, to the extent such payments are lawful,
interest on overdue principal and it shall pay interest on overdue installments
of interest (without regard to any applicable grace periods) from time to time
on demand at the rate borne by the Securities plus 2% per annum. Interest will
be computed on the basis of a 360-day year comprised of twelve 30-day months.
SECTION 4.02 Maintenance of Office or Agency.
The Company shall maintain in the Borough of Manhattan, The
City of New York, the office or agency required under Section 2.03. The
Company shall give prompt written notice to the Trustee of the location, and
any change in the location, of such office or agency. If at any time the
Company shall fail to maintain any such required office or agency or shall fail
to furnish the Trustee with the address thereof, such presentations,
surrenders, notices and demands may be made or served at the address of the
Trustee set forth in Section 11.02. The Company hereby initially designates
the Corporate Trust Office of the Trustee as its office or agency in the
Borough of Manhattan, The City of New York.
SECTION 4.03 Limitation on Restricted Payments.
The Company will not, and will not permit any of its
Restricted Subsidiaries to, directly or indirectly:
(a) declare or pay any dividend or make any other
distribution or payment on or in respect of Capital Stock of the
Company or any of its Restricted Subsidiaries or any payment made to
the direct or indirect holders (in their capacities as such) of
Capital Stock of the Company or any of its Restricted Subsidiaries
(other than (x) dividends or distributions payable solely in Capital
Stock of the Company (other than Redeemable Capital Stock) or in
options, warrants or other rights to purchase Capital Stock of the
Company (other than Redeemable Capital Stock), (y) the declaration or
payment of dividends or other distributions to the extent declared or
paid to the Company or any Restricted Subsidiary of the Company and
(z) the declaration or payment of dividends or other distributions by
any Restricted Subsidiary of the Company to all holders of Common
Stock of such Restricted Subsidiary on a pro rata basis),
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(b) purchase, redeem, defease or otherwise acquire or
retire for value any Capital Stock of the Company or any of its
Restricted Subsidiaries (other than any such Capital Stock owned by a
Wholly-Owned Restricted Subsidiary),
(c) make any principal payment on, or purchase, defease,
repurchase, redeem or otherwise acquire or retire for value, prior to
any scheduled maturity, scheduled repayment, scheduled sinking fund
payment or other Stated Maturity, any Subordinated Indebtedness (other
than any such Indebtedness owned by the Company or a Wholly-Owned
Restricted Subsidiary), or
(d) make any Investment (other than any Permitted
Investment) in any person
(such payments or Investments described in the preceding clauses (a), (b), (c)
and (d) are collectively referred to as "Restricted Payments"), unless, at the
time of and after giving effect to the proposed Restricted Payment (the amount
of any such Restricted Payment, if other than cash, shall be the Fair Market
Value on the date of such Restricted Payment of the asset(s) proposed to be
transferred by the Company or such Restricted Subsidiary, as the case may be,
pursuant to such Restricted Payment), (A) no Default or Event of Default shall
have occurred and be continuing, (B) immediately prior to and after giving
effect to such Restricted Payment, the Company would be able to incur $1.00 of
additional Indebtedness pursuant to the first paragraph of Section 4.04
(assuming a market rate of interest with respect to such additional
Indebtedness) and (C) the aggregate amount of all Restricted Payments declared
or made from and after the Issue Date would not exceed the sum of (1) 50% of
the aggregate Consolidated Net Income of the Company accrued on a cumulative
basis during the period beginning on the first day of the fiscal quarter of the
Company during which the Issue Date occurs and ending on the last day of the
fiscal quarter of the Company immediately preceding the date of such proposed
Restricted Payment, which period shall be treated as a single accounting period
(or, if such aggregate cumulative Consolidated Net Income of the Company for
such period shall be a deficit, minus 100% of such deficit) plus (2) the
aggregate net proceeds (the amount of such proceeds, if other than cash, shall
be the Fair Market Value on the date such proceeds are received by the Company
of the asset(s) comprising such proceeds) received by the Company either (x) as
capital contributions to the Company after the Issue Date from any person
(other than a Subsidiary of the Company) or (y) from the issuance or sale of
Capital Stock (excluding Redeemable Capital Stock, but including Capital Stock
issued upon the
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conversion of convertible Indebtedness or from the exercise of options,
warrants or rights to purchase Capital Stock (other than Redeemable Capital
Stock)) of the Company to any person (other than to a Subsidiary of the
Company) after the Issue Date plus (3) in the case of the disposition or
repayment of any Investment constituting a Restricted Payment made after the
Issue Date (excluding any Investment described in clause (v) of the following
paragraph), an amount equal to the lesser of the return of capital with respect
to such Investment and the initial amount of such Investment, in either case,
less the cost of the disposition of such Investment. For purposes of the
preceding clause (C)(2), the value of the aggregate net proceeds received by
the Company upon the issuance of Capital Stock upon the conversion of
convertible Indebtedness or upon the exercise of options, warrants or rights
will be the net proceeds received upon the issuance of such Indebtedness,
options, warrants or rights plus the incremental proceeds received by the
Company upon the conversion or exercise thereof.
None of the foregoing provisions will prohibit (i) the payment
of any dividend within 60 days after the date of its declaration, if at the
date of declaration such payment would be permitted by the foregoing paragraph;
(ii) so long as no Default or Event of Default shall have occurred and be
continuing, the redemption, repurchase or other acquisition or retirement of
any shares of any class of Capital Stock of the Company or any Restricted
Subsidiary of the Company in exchange for, or out of the net proceeds of, a
substantially concurrent (x) capital contribution to the Company from any
person (other than a Subsidiary of the Company) or (y) issue and sale of other
shares of Capital Stock (other than Redeemable Capital Stock) of the Company to
any person (other than to a Subsidiary of the Company); provided, however, that
the amount of any such net proceeds that are utilized for any such redemption,
repurchase or other acquisition or retirement shall be excluded from clause
(C)(2) of the preceding paragraph; (iii) so long as no Default or Event of
Default shall have occurred and be continuing, any redemption, repurchase or
other acquisition or retirement of Subordinated Indebtedness by exchange for,
or out of the net proceeds of, a substantially concurrent (x) capital
contribution to the Company from any person (other than a Subsidiary of the
Company) or (y) issue and sale of (1) Capital Stock (other than Redeemable
Capital Stock) of the Company to any person (other than to a Subsidiary of the
Company); provided, however, that the amount of any such net proceeds that are
utilized for any such redemption, repurchase or other acquisition or retirement
shall be excluded from clause (C)(2) of the preceding paragraph; or (2)
Indebtedness of the Company issued to any person (other than a
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Subsidiary of the Company), so long as such Indebtedness is Subordinated
Indebtedness which (x) has no Stated Maturity earlier than the 91st day after
the Final Maturity Date, (y) has an Average Life to Stated Maturity equal to or
greater than the remaining Average Life to Stated Maturity of the Securities
and (z) is subordinated to the Securities in the same manner and at least to
the same extent as the Subordinated Indebtedness so purchased, exchanged,
redeemed, acquired or retired; (iv) so long as no Default or Event of Default
shall have occurred and be continuing, the making of any Restricted Payment by
the Company or any Restricted Subsidiary of the Company during any period of
time when the Securities are rated Investment Grade by S&P and Moody's (or if
either S&P or Moody's does not make a rating of the Securities publicly
available, by either S&P or Moody's and an equivalent rating by another Rating
Agency); (v) Investments constituting Restricted Payments made as a result of
the receipt of non-cash consideration from any Asset Sale made pursuant to and
in compliance with Section 4.16; (vi) so long as no Default or Event of Default
has occurred and is continuing, repurchases by the Company of Common Stock of
the Company from employees of the Company or any of its Subsidiaries or their
authorized representatives upon the death, disability or termination of
employment of such employees, in an aggregate amount not exceeding $1,000,000
in any calendar year; and (vii) so long as no Default or Event of Default has
occurred and is continuing, other Restricted Payments in an aggregate amount
not exceeding $5,000,000. In computing the amount of Restricted Payments
previously made for purposes of clause (C) of the preceding paragraph,
Restricted Payments made under the preceding clauses (i), (iv), (vi) and (vii)
shall be included and clauses (ii), (iii) and (v) shall not be so included.
SECTION 4.04 Limitation on Indebtedness.
The Company will not, and will not permit any of its
Restricted Subsidiaries to, directly or indirectly, create, incur, issue,
assume, guarantee or in any manner become directly or indirectly liable,
contingently or otherwise, for the payment of (in each case, to "incur") any
Indebtedness (including, without limitation, any Acquired Indebtedness);
provided, however, that the Company or any Guarantor will be permitted to incur
Indebtedness (including, without limitation, Acquired Indebtedness) if, at the
time of such incurrence, and after giving pro forma effect thereto, the
Consolidated Fixed Charge Coverage Ratio of the Company is at least equal to
2:1.
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Notwithstanding the foregoing, the Company and its Restricted
Subsidiaries may, to the extent specifically set forth below, incur each and
all of the following:
(a) Indebtedness of the Company evidenced by the
Securities and Indebtedness of any Guarantor evidenced by its
Guarantee;
(b) Indebtedness of the Company and its Subsidiaries
outstanding on the Issue Date;
(c) Indebtedness of the Company and any Guarantor under
the Credit Agreement in an aggregate principal amount at any one time
outstanding not to exceed the greater of (x) the sum of (A) 80% of the
accounts receivable of the Company and its Restricted Subsidiaries on
a consolidated basis and (B) 60% of the inventory of the Company and
its Restricted Subsidiaries on a consolidated basis and (y)
$135,000,000;
(d) (i) Interest Rate Protection Obligations of the
Company covering Indebtedness of the Company or a Restricted
Subsidiary of the Company and (ii) Interest Rate Protection
Obligations of any Restricted Subsidiary of the Company covering
Indebtedness of such Restricted Subsidiary; provided, however, that,
in the case of either clause (i) or (ii), (x) any Indebtedness to
which any such Interest Rate Protection Obligations relate is
otherwise permitted to be incurred under this Section 4.04 and (y) the
notional principal amount of any such Interest Rate Protection
Obligations does not exceed the principal amount of the Indebtedness
to which such Interest Rate Protection Obligations relate;
(e) Indebtedness of a Wholly-Owned Restricted Subsidiary
owed to and held by the Company or another Wholly-Owned Restricted
Subsidiary, in each case which is not subordinated in right of payment
to any Indebtedness of such Wholly-Owned Restricted Subsidiary,
except that (i) any transfer of such Indebtedness by the Company or a
Wholly-Owned Restricted Subsidiary (other than to the Company or to a
Wholly-Owned Restricted Subsidiary) and (ii) the sale, transfer or
other disposition by the Company or any Wholly-Owned Restricted
Subsidiary of Capital Stock of a Wholly-Owned Restricted Subsidiary
which is owed Indebtedness of another Wholly-Owned Restricted
Subsidiary such that it ceases to be a Wholly-Owned Restricted
Subsidiary shall, in each case, be an incurrence of Indebtedness by
such Wholly-
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Owned Restricted Subsidiary subject to the other provisions of this
Section 4.04;
(f) Indebtedness of the Company owed to and held by a
Wholly-Owned Restricted Subsidiary which is unsecured and subordinated
in right of payment to the payment and performance of the Company's
obligations under this Indenture and the Securities except that (i)
any transfer of such Indebtedness by a Wholly-Owned Restricted
Subsidiary (other than to another Wholly-Owned Restricted Subsidiary)
and (ii) the sale, transfer or other disposition by the Company or any
Wholly-Owned Restricted Subsidiary of Capital Stock of a Wholly-Owned
Restricted Subsidiary which holds Indebtedness of the Company such
that it ceases to be a Wholly-Owned Restricted Subsidiary shall, in
each case, be an incurrence of Indebtedness by the Company, subject to
the other provisions of this Section 4.04;
(g) Indebtedness under Currency Agreements; provided that
in the case of Currency Agreements which relate to Indebtedness, such
Currency Agreements do not increase the Indebtedness of the Company
and its Restricted Subsidiaries outstanding other than as a result of
fluctuations in foreign currency exchange rates or by reason of fees,
indemnities and compensation payable thereunder;
(h) Indebtedness arising from the honoring by a bank or
other financial institution of a check, draft or similar instrument
inadvertently (except in the case of daylight overdrafts) drawn
against insufficient funds in the ordinary course of business;
provided, however, that such Indebtedness is extinguished within two
Business Days of incurrence;
(i) Indebtedness of the Company or any of its Restricted
Subsidiaries represented by letters of credit for the account of the
Company or such Restricted Subsidiary, as the case may be, in order to
provide security for workers' compensation claims, payment obligations
in connection with self-insurance or similar requirements in the
ordinary course of business;
(j) Indebtedness of Restricted Subsidiaries of the
Company which are not Guarantors not to exceed the sum of (x) 90% of
the accounts receivable of any such Restricted Subsidiary, (y) 70% of
the inventory of any such Restricted Subsidiary and (z) 10% of the Net
Worth of any such Restricted Subsidiary; provided that if any such
Subsidiary
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shall sell or otherwise transfer any of its accounts receivable, the
Net Cash Proceeds from any such sale or transfer shall be used to
repay any Indebtedness of such Subsidiary incurred pursuant to this
clause (j);
(k) Indebtedness incurred by the Company or any of its
Restricted Subsidiaries during any period of time when the Securities
are rated Investment Grade by S&P and Moody's (or if either S&P or
Moody's does not make a rating of the Securities publicly available,
by either S&P or Moody's and an equivalent rating by another Rating
Agency) and no Default or Event of Default shall have occurred and be
continuing;
(l) Indebtedness of the Company or any Guarantor in
addition to that described in clauses (a) through (k) above, in an
aggregate principal amount outstanding at any time not exceeding
$20,000,000; and
(m) (i) Indebtedness of the Company the proceeds of which
are used solely to refinance (whether by amendment, renewal, extension
or refunding) Indebtedness of the Company or any of its Restricted
Subsidiaries and (ii) Indebtedness of any Restricted Subsidiary of the
Company the proceeds of which are used solely to refinance (whether by
amendment, renewal, extension or refunding) Indebtedness of such
Restricted Subsidiary, in each case other than the Indebtedness
refinanced, redeemed or retired as described under "Use of Proceeds"
in the Offering Memorandum or incurred under clause (c), (d), (e),
(f), (g), (h), (i), (j) or (l) of this Section 4.04; provided,
however, that (x) the principal amount of Indebtedness incurred
pursuant to this clause (m) (or, if such Indebtedness provides for an
amount less than the principal amount thereof to be due and payable
upon a declaration of acceleration of the maturity thereof, the
original issue price of such Indebtedness) shall not exceed the sum of
the principal amount of Indebtedness so refinanced, plus the amount of
any premium required to be paid in connection with such refinancing
pursuant to the terms of such Indebtedness or the amount of any
premium reasonably determined by the Board of Directors of the Company
as necessary to accomplish such refinancing by means of a tender offer
or privately negotiated purchase, plus the amount of reasonable
expenses in connection therewith, and (y) in the case of Indebtedness
incurred by the Company or any Guarantor pursuant to this clause (m),
such Indebtedness (A) has no scheduled principal payment prior to the
earlier of (1) the final maturity of the Indebtedness refinanced or
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(2) the 91st day after the Final Maturity Date and (B) has an Average
Life to Stated Maturity greater than either (1) the Average Life to
Stated Maturity of the Indebtedness refinanced or (2) the remaining
Average Life to Stated Maturity of the Securities.
The Company will not, directly or indirectly, in any event
incur any Indebtedness which by its terms (or by the terms of any agreement
governing such Indebtedness) is subordinated in right of payment to any other
Indebtedness of the Company unless such Indebtedness is also by its terms (or
by the terms of any agreement governing such Indebtedness) made expressly
subordinate in right of payment to the Securities pursuant to subordination
provisions that are substantively identical to the subordination provisions of
such Indebtedness (or such agreement) that are most favorable to the holders of
any other Indebtedness of the Company.
SECTION 4.05 Corporate Existence.
Except as otherwise permitted by Article Five, the Company
shall do or cause to be done all things necessary to preserve and keep in full
force and effect its corporate existence and the corporate, partnership or
other existence of each of its Restricted Subsidiaries in accordance with the
respective organizational documents of each Restricted Subsidiary and the
rights (charter and statutory) and material franchises of the Company and each
of its Restricted Subsidiaries; provided, however, that the Company shall not
be required to preserve any such right or franchise, or the corporate existence
of any Restricted Subsidiary, if the Board of Directors of the Company shall
determine that the preservation thereof is no longer desirable in the conduct
of the business of the Company and its Restricted Subsidiaries, taken as a
whole, and that the loss thereof is not, and will not be, adverse in any
material respect to the Holders.
SECTION 4.06 Payment of Taxes and Other Claims.
The Company shall pay or discharge or cause to be paid or
discharged, before the same shall become delinquent, (i) all material taxes,
assessments and governmental charges levied or imposed upon it or any of its
Restricted Subsidiaries or upon the income, profits or property of it or any of
its Restricted Subsidiaries and (ii) all lawful claims for labor, materials and
supplies which, in each case, if unpaid, might by law become a material
liability or Lien upon the property of it or any of its Restricted
Subsidiaries; provided, however, that the Company
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shall not be required to pay or discharge or cause to be paid or discharged any
such tax, assessment, charge or claim whose amount, applicability or validity
is being contested in good faith by appropriate proceedings and for which
appropriate provision has been made.
SECTION 4.07 Maintenance of Properties and Insurance.
(a) The Company shall cause all material properties owned
by or leased by it or any of its Restricted Subsidiaries used or useful to the
conduct of its business or the business of any of its Restricted Subsidiaries
to be improved or maintained and kept in normal condition, repair and working
order and supplied with all necessary equipment and shall cause to be made all
necessary repairs, renewals, replacements, betterments and improvements
thereof, all as in its judgment may be necessary, so that the business carried
on in connection therewith may be properly and advantageously conducted at all
times; provided, however, that nothing in this Section 4.07 shall prevent the
Company or any of its Restricted Subsidiaries from discontinuing the use,
operation or maintenance of any of such properties, or disposing of any of
them, if such discontinuance or disposal is, in the judgment of the Board of
Directors of the Company or of the Board of Directors of any Restricted
Subsidiary of the Company, or of an officer (or other agent employed by the
Company or of any of its Restricted Subsidiaries) of the Company or any of its
Restricted Subsidiaries having managerial responsibility for any such property,
desirable in the conduct of the business of the Company or any Restricted
Subsidiary of the Company, and if such discontinuance or disposal is not
adverse in any material respect to the Holders.
(b) The Company shall maintain, and shall cause its
Restricted Subsidiaries to maintain, insurance with responsible carriers
against such risks and in such amounts, and with such deductibles, retentions,
self-insured amounts and co- insurance provisions, as are customarily carried
by similar businesses of similar size, including property and casualty loss,
workers' compensation and interruption of business insurance.
SECTION 4.08 Compliance Certificate; Notice of Default.
(a) The Company shall deliver to the Trustee, within 100
days after the close of each fiscal year an Officers' Certificate stating that
a review of the activities of the Company has been made under the supervision
of the signing officers with a view to determining whether it has kept,
observed, performed and fulfilled its obligations under this
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Indenture and further stating, as to each such Officer signing such
certificate, that to the best of his knowledge the Company during such
preceding fiscal year has kept, observed, performed and fulfilled each and
every such covenant and no Default or Event of Default occurred during such
year and at the date of such certificate no Default or Event of Default has
occurred and is continuing or, if such signers do know of such Default or Event
of Default, the certificate shall describe its status with particularity. The
Officers' Certificate shall also notify the Trustee should the Company elect to
change the manner in which it fixes its fiscal year end.
(b) The annual financial statements delivered pursuant to
Section 4.10 shall be accompanied by a written report of the Company's
independent accountants (who shall be a firm of established national
reputation) that in conducting their audit of such financial statements nothing
has come to their attention that would lead them to believe that the Company
has violated any provisions of Article 4, 5 or 6 of this Indenture insofar as
they relate to accounting matters or, if any such violation has occurred,
specifying the nature and period of existence thereof, it being understood that
such accountants shall not be liable directly or indirectly to any person for
any failure to obtain knowledge of any such violation.
(c) The Company shall deliver to the Trustee, within ten
days of becoming aware of any Default or Event of Default in the performance of
any covenant, agreement or condition contained in this Indenture, an Officers'
Certificate specifying the Default or Event of Default and describing its
status with particularity.
SECTION 4.09 Compliance with Laws.
The Company shall comply, and shall cause each of its
Restricted Subsidiaries to comply, with all applicable statutes, rules,
regulations, orders and restrictions of the United States of America, all
states and municipalities thereof, and of any governmental department,
commission, board, regulatory authority, bureau, agency and instrumentality of
the foregoing, in respect of the conduct of their respective businesses and the
ownership of their respective properties, except for such noncompliances as
would not in the aggregate have a material adverse effect on the financial
condition or results of operations of the Company and its Restricted
Subsidiaries taken as a whole.
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SECTION 4.10 SEC Reports.
(a) The Company will file with the SEC all information
documents and reports to be filed with the SEC pursuant to Section 13 or 15(d)
of the Exchange Act, whether or not the Company is subject to such filing
requirements so long as the SEC will accept such filings. The Company (at its
own expense) will file with the Trustee within 15 days after it files them with
the SEC, copies of the annual reports and of the information, documents and
other reports (or copies of such portions of any of the foregoing as the SEC
may by rules and regulations prescribe) which the Company files with the SEC
pursuant to Section 13 or 15(d) of the Exchange Act. Upon qualification of
this Indenture under the TIA, the Company shall also comply with the provisions
of TIA Section 314(a).
(b) At the Company's expense, regardless of whether the
Company is required to furnish such reports to its stockholders pursuant to the
Exchange Act, the Company shall cause its consolidated financial statements,
comparable to that which would have been required to appear in annual or
quarterly reports, to be delivered to the Trustee and the Holders. The Company
will also make such reports available to prospective purchasers of the
Securities, securities analysts and broker-dealers upon their request.
(c) For so long as any of the Securities remain
outstanding the Company will make available to any prospective purchaser of the
Securities or beneficial owner of the Securities in connection with any sale
thereof the information required by Rule 144A(d)(4) under the Securities Act
during any period when the Company is not subject to Section 13 or 15(d) under
the Exchange Act.
SECTON 4.11 Waiver of Stay, Extension or Usury Laws.
The Company covenants (to the extent that it may lawfully do
so) that it shall not at any time insist upon, plead, or in any manner
whatsoever claim or take the benefit or advantage of, any stay or extension law
or any usury law or other law that would prohibit or forgive the Company from
paying all or any portion of the principal of and/or interest on the
Securities as contemplated herein, wherever enacted, now or at any time
hereafter in force, or which may affect the covenants or the performance of
this Indenture, and (to the extent that it may lawfully do so) the Company
hereby expressly waives all benefit or advantage of any such law, and covenants
that it will not hinder, delay or impede the execution of any power herein
granted
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to the Trustee, but will suffer and permit the execution of every such power as
though no such law had been enacted.
SECTION 4.12 Limitation on Transactions with Interested Persons.
The Company will not, and will not permit any of its
Restricted Subsidiaries to, directly or indirectly, enter into or suffer to
exist any transaction or series of related transactions (including, without
limitation, the sale, transfer, disposition, purchase, exchange or lease of
assets, property or services) with, or for the benefit of, any Affiliate of the
Company, unless (a) such transaction or series of related transactions is on
terms that are no less favorable to the Company or such Restricted Subsidiary,
as the case may be, than those which could have been obtained in a comparable
transaction at such time from persons who are not Affiliates of the Company,
(b) with respect to a transaction or series of transactions involving aggregate
payments or value equal to or greater than $5,000,000, the Company has obtained
a written opinion from an Independent Financial Advisor stating that the terms
of such transaction or series of transactions are fair to the Company or such
Restricted Subsidiary, as the case may be, from a financial point of view and
(c) with respect to a transaction or series of transactions involving aggregate
payments or value equal to or greater than $2,500,000, the Company shall have
delivered an Officers' Certificate to the Trustee certifying that such
transaction or series of transactions complies with the preceding clause (a)
and, if applicable, certifying that the opinion referred to in the preceding
clause (b) has been delivered and that such transaction or series of
transactions has been approved by a majority of the Board of Directors of the
Company; provided, however, that this Section 4.12 will not restrict the
Company from (i) paying dividends in respect of its Capital Stock permitted
under Section 4.03, (ii) paying reasonable and customary fees to directors of
the Company who are not employees of the Company or (iii) making loans or
advances to officers, employees or consultants of the Company and its
Restricted Subsidiaries (including travel and moving expenses) in the ordinary
course of business for bona fide business purposes of the Company or such
Restricted Subsidiary not in excess of $5,000,000 in the aggregate at any one
time outstanding.
SECTION 4.13 Limitation on Dividend and Other Payment Restrictions Affecting
Restricted Subsidiaries.
The Company will not, and will not permit any of its
Restricted Subsidiaries to, directly or indirectly, create or
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otherwise cause or suffer to exist or become effective any encumbrance or
restriction on the ability of any Restricted Subsidiary of the Company to (a)
pay dividends, in cash or otherwise, or make any other distributions on or in
respect of its Capital Stock or any other interest or participation in, or
measured by, its profits, (b) pay any Indebtedness owed to the Company or any
other Restricted Subsidiary of the Company, (c) make loans or advances to, or
any investment in, the Company or any other Restricted Subsidiary of the
Company, (d) transfer any of its properties or assets to the Company or any
other Restricted Subsidiary of the Company or (e) guarantee any Indebtedness of
the Company or any other Restricted Subsidiary of the Company, except for such
encumbrances or restrictions existing under or by reason of (i) applicable law,
(ii) customary non-assignment provisions of any contract or any lease governing
a leasehold interest of the Company or any Restricted Subsidiary of the
Company, (iii) customary restrictions on transfers of property subject to a
Lien permitted under this Indenture which could not materially adversely affect
the Company's ability to satisfy its obligations under this Indenture and the
Securities, (iv) any agreement or other instrument of a person acquired by the
Company or any Restricted Subsidiary of the Company (or a Restricted Subsidiary
of such person) in existence at the time of such acquisition (but not created
in contemplation thereof), which encumbrance or restriction is not applicable
to any person, or the properties or assets of any person, other than the
person, or the properties or assets of the person, so acquired, (v) provisions
contained in agreements or instruments relating to Indebtedness which prohibit
the transfer of all or substantially all of the assets of the obligor
thereunder unless the transferee shall assume the obligations of the obligor
under such agreement or instrument and (vi) encumbrances and restrictions under
and as contemplated by agreements governing Indebtedness in effect on the Issue
Date and encumbrances and restrictions in permitted refinancings or
replacements thereof which are no less favorable to the Holders of the
Securities than those contained in the Indebtedness so refinanced or replaced.
SECTION 4.14 Limitation on Liens.
The Company will not, and will not permit any of its
Restricted Subsidiaries to, create, incur, assume or suffer to exist any Liens
of any kind against or upon any of its property or assets, or any proceeds
therefrom, unless (x) in the case of Liens securing Subordinated Indebtedness,
the Securities are secured by a Lien on such property, assets or proceeds that
is senior in priority to such Liens and (y) in all other cases, the Securities
are equally and ratably secured, except for (a) Liens
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existing as of the Issue Date and Liens under and as contemplated by agreements
existing as of the Issue Date, including Liens on Capital Stock of Subsidiaries
of the Company, accounts receivable, inventory and intangibles of the Company
and its Restricted Subsidiaries securing Indebtedness (including any
guarantees) under the Credit Agreement and the Note Agreement incurred in
accordance with this Indenture; (b) Liens securing the Securities or any
Guarantee; (c) Liens in favor of the Company; (d) Liens securing Indebtedness
which is incurred to refinance Indebtedness which has been secured by a Lien
permitted under this Indenture and which has been incurred in accordance with
the provisions of this Indenture; provided, however, that such Liens do not
extend to or cover any property or assets of the Company or any of its
Restricted Subsidiaries not securing the Indebtedness so refinanced; and (e)
Permitted Liens.
SECTION 4.15 Change of Control.
(a) Upon the occurrence of a Change of Control, the
Company shall be obligated to make an offer to purchase (a "Change of Control
Offer"), and shall purchase, on a Business Day (the "Change of Control Purchase
Date") not more than 60 nor less than 30 days following the occurrence of the
Change of Control, all of the then outstanding Securities at a purchase price
equal to 101% of the principal amount thereof, plus accrued and unpaid
interest, if any, to the Change of Control Purchase Date. The Change of
Control Offer shall remain open for at least 20 Business Days and until the
close of business on the Change of Control Purchase Date.
(b) Within 30 days following the date upon which the
Change of Control occurred (the "Change of Control Date"), the Company shall
mail, or cause to be mailed, by first class mail, a notice to each Holder,
with a copy to the Trustee, which notice shall govern the terms of the Change
of Control Offer. The notice to the Holders shall contain all instructions and
materials necessary to enable such Holders to tender Securities pursuant to the
Change of Control Offer. Such notice shall state:
(1) that the Change of Control Offer is being made
pursuant to this Section 4.15 and that all Securities tendered and not
withdrawn will be accepted for payment;
(2) the purchase price (including the amount of accrued
interest) and the Change of Control Purchase Date;
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(3) that any Security not tendered will continue to
accrue interest;
(4) that, unless the Company defaults in making payment
therefor, any Security accepted for payment pursuant to the Change of
Control Offer shall cease to accrue interest after the Change of
Control Purchase Date;
(5) that Holders electing to have a Security purchased
pursuant to a Change of Control Offer will be required to surrender
the Security, with the form entitled "Option of Holder to Elect
Purchase" on the reverse of the Security completed, to the Paying
Agent at the address specified in the notice prior to the close of
business on the Change of Control Purchase Date;
(6) that Holders will be entitled to withdraw their
election if the Paying Agent receives, not later than the second
Business Day prior to the Change of Control Purchase Date, a facsimile
transmission or letter setting forth the name of the Holder, the
principal amount of the Securities the Holder delivered for purchase
and a statement that such Holder is withdrawing his election to have
such Securities purchased;
(7) that Holders whose Securities are purchased only in
part will be issued new Securities in a principal amount equal to the
unpurchased portion of the Securities surrendered; and
(8) the circumstances and relevant facts regarding such
Change of Control.
On or before the Change of Control Purchase Date, the Company
shall (i) accept for payment Securities or portions thereof tendered pursuant
to the Change of Control Offer, (ii) deposit with the Paying Agent in
accordance with Section 2.14 U.S. Legal Tender sufficient to pay the purchase
price plus accrued interest, if any, of all Securities so tendered and (iii)
deliver to the Trustee Securities so accepted together with an Officers'
Certificate stating the Securities or portions thereof being purchased by the
Company. Upon receipt by the Paying Agent of the monies specified in clause
(ii) above and a copy of the Officers' Certificate specified in clause (iii)
above, the Paying Agent shall promptly mail to the Holders of Securities so
accepted payment in an amount equal to the purchase price plus accrued
interest, if any, and the Trustee shall promptly authenticate and mail to such
Holders new Securities
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equal in principal amount to any unpurchased portion of the Securities
surrendered. Any Securities not so accepted shall be promptly mailed by the
Company to the Holder thereof. For purposes of this Section 4.15, the Trustee
shall act as the Paying Agent.
Any amounts remaining after the purchase of all validly
tendered and not validly withdrawn Securities pursuant to a Change of Control
Offer shall be returned by the Trustee to the Company.
The Company shall and shall cause its Subsidiaries to comply
with all tender offer rules under state and Federal securities laws, including,
but not limited to, Section 14(e) under the Exchange Act and Rule 14e-1
thereunder, to the extent applicable to such offer. To the extent that the
provisions of any securities laws or regulations conflict with this Section
4.15, the Company shall comply with the applicable securities laws and
regulations and shall not be deemed to have breached its obligations under this
Section 4.15 by virtue thereof.
The Company shall not be required to make a Change of Control
Offer upon a Change of Control if a third party makes the Change of Control
Offer in the manner, at the times and otherwise in compliance with the
requirements applicable to a Change of Control Offer made by the Company and
purchases all Securities validly tendered and not withdrawn under such Change
of Control Offer.
SECTION 4.16 Disposition of Proceeds of Asset Sales.
(a) The Company will not, and will not permit any of its
Restricted Subsidiaries to, make any Asset Sale during any period when the
Securities are not rated Investment Grade by S&P and Moody's (or if either S&P
or Moody's does not make a rating of the Securities publicly available, by
either S&P or Moody's and an equivalent rating by another Rating Agency (such
period, the "Non-Investment Grade Period")) unless (a) the Company or such
Restricted Subsidiary, as the case may be, receives consideration at the time
of such Asset Sale at least equal to the Fair Market Value of the shares or
assets sold or otherwise disposed of and (b) at least 75% of such consideration
consists of cash or Cash Equivalents. To the extent the Net Cash Proceeds of
any Asset Sale consummated during the Non-Investment Grade Period are not
required (a) to repay any Indebtedness secured by the assets subject to such
Asset Sale pursuant to Liens permitted under this Indenture, (b) to repay
Indebtedness incurred pursuant to clause (j) of Section 4.04 or (c) to be
applied to repay, and
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permanently reduce the commitments under, the Credit Agreement (as required by
the terms thereof), or, in each case, are not so applied, the Company or such
Restricted Subsidiary, as the case may be, may, within 365 days of such Asset
Sale, apply such Net Cash Proceeds to an investment in properties and assets
that replace the properties and assets that were the subject of such Asset Sale
or in properties and assets that will be used in the businesses of the Company
and its Restricted Subsidiaries existing on the Issue Date or in businesses
reasonably related thereto ("Replacement Assets"). Any Net Cash Proceeds from
any Asset Sale consummated during the Non-Investment Grade Period that are
neither used to repay Indebtedness, as specified in the immediately preceding
sentence, nor invested in Replacement Assets within the 365-day period
described above constitute "Excess Proceeds," subject to disposition as
provided below in clause (b) of this Section 4.16.
(b) When the aggregate amount of Excess Proceeds equals
or exceeds $10,000,000, the Company shall make an offer to purchase (an "Asset
Sale Offer"), from all Holders of the Securities, not more than 40 Business
Days thereafter (the "Excess Proceeds Payment Date"), an aggregate principal
amount of Securities equal to such Excess Proceeds, at a price in cash equal to
100% of the outstanding principal amount thereof plus accrued and unpaid
interest, if any, to the Excess Proceeds Payment Date. To the extent that the
aggregate principal amount of Securities tendered pursuant to an Asset Sale
Offer is less than the Excess Proceeds, the Company may use such deficiency
for general corporate purposes. If the aggregate principal amount of
Securities validly tendered and not withdrawn by holders thereof exceeds the
Excess Proceeds, Securities to be purchased will be selected on a pro rata
basis. Upon completion of such Asset Sale Offer, the amount of Excess Proceeds
shall be reset to zero.
(c) Notice of each Asset Sale Offer pursuant to this
Section 4.16 shall be mailed or caused to be mailed, by first class mail, by
the Company not less than 30 days prior to the Excess Proceeds Payment Date to
all Holders at their last registered addresses, with a copy to the Trustee.
The notice shall contain all instructions and materials necessary to enable
such Holders to tender Securities pursuant to the Asset Sale Offer and shall
state the following terms:
(1) that the Asset Sale Offer is being made pursuant to
Section 4.16 and that all Securities tendered will be accepted for
payment; provided, however, that if the principal amount of Securities
tendered in an Asset Sale Offer plus accrued interest at the
expiration of such offer
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exceeds the aggregate amount of the Excess Proceeds, the Company shall
select the Securities to be purchased on a pro rata basis;
(2) the purchase price (including the amount of accrued
interest, if any) and the Excess Proceeds Payment Date (which shall be
at least 20 Business Days from the date of mailing of notice of such
Asset Sale Offer, or such longer period as required by law);
(3) that any Security not tendered will continue to
accrue interest;
(4) that, unless the Company defaults in making payment
therefor, any Security accepted for payment pursuant to the Asset Sale
Offer shall cease to accrue interest after the Excess Proceeds Payment
Date;
(5) that Holders electing to have a Security purchased
pursuant to an Asset Sale Offer will be required to surrender the
Security, with the form entitled "Option of Holder to Elect Purchase"
on the reverse of the Security completed, to the Paying Agent at the
address specified in the notice prior to the close of business on the
Excess Proceeds Payment Date;
(6) that Holders will be entitled to withdraw their
election if the Paying Agent receives, not later than the second
Business Day prior to the Excess Proceeds Payment Date, a facsimile
transmission or letter setting forth the name of the Holder, the
principal amount of the Security the Holder delivered for purchase and
a statement that such Holder is withdrawing his election to have such
Security purchased; and
(7) that Holders whose Securities are purchased only in
part will be issued new Securities in a principal amount equal to the
unpurchased portion of the Securities surrendered.
On or before the Excess Proceeds Payment Date, the Company
shall (i) accept for payment Securities or portions thereof tendered pursuant
to the Asset Sale Offer which are to be purchased in accordance with item
(c)(1) above, (ii) deposit with the Paying Agent in accordance with Section
2.14 U.S. Legal Tender sufficient to pay the purchase price plus accrued
interest, if any, of all Securities to be purchased and (iii) deliver to the
Trustee Securities so accepted together with
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an Officers' Certificate stating the Securities or portions thereof being
purchased by the Company. The Paying Agent shall promptly mail to the Holders
of Securities so accepted payment in an amount equal to the purchase price plus
accrued interest, if any. For purposes of this Section 4.16, the Trustee shall
act as the Paying Agent.
The Company shall and shall cause its Subsidiaries to comply
with all tender offer rules under state and Federal securities laws, including,
but not limited to, Section 14(e) under the Exchange Act and Rule 14e-1
thereunder, to the extent applicable to such offer. To the extent that the
provisions of any securities laws or regulations conflict with the foregoing
provisions of this Indenture, the Company shall comply with the applicable
securities laws and regulations and shall not be deemed to have breached its
obligations under the foregoing provisions of this Indenture by virtue thereof.
(d) In the event of the transfer of substantially all
(but not all) of the property and assets of the Company and its Restricted
Subsidiaries as an entirety to a person in a transaction permitted under
Section 5.01 hereof, the successor corporation shall be deemed to have sold the
properties and assets of the Company and its Restricted Subsidiaries not so
transferred for purposes of this Section 4.16, and shall comply with the
provisions of this Section 4.16 with respect to such deemed sale as if it were
an Asset Sale. In addition, the Fair Market Value of such properties and
assets of the Company or its Restricted Subsidiaries deemed to be sold shall be
deemed to be Net Cash Proceeds for purposes of this Section 4.16.
SECTION 4.17 Limitation on Issuance and Sale of Preferred Stock by
Restricted Subsidiaries.
The Company (a) will not permit any of its Restricted
Subsidiaries to issue any Preferred Stock (other than to the Company or a
Wholly-Owned Restricted Subsidiary) and (b) will not permit any person (other
than the Company or a Wholly-Owned Restricted Subsidiary) to own any Preferred
Stock of any Restricted Subsidiary of the Company; provided, however, that this
Section 4.17 shall not prohibit the issuance and sale of (x) all, but not less
than all, of the issued and outstanding Capital Stock of any Restricted
Subsidiary of the Company owned by the Company or any of its Restricted
Subsidiaries in compliance with the other provisions of this Indenture or (y)
the issuance or sale of any Preferred Stock of a Restricted Subsidiary during
any period of time when the Securities are rated Investment Grade by S&P and
Moody's (or if either S&P or
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Moody's does not make a rating of the Securities publicly available, by either
S&P or Moody's and an equivalent rating by another Rating Agency), so long as
no Default or Event of Default shall have occurred and be continuing.
SECTION 4.18 Limitation on Sale-Leaseback Transactions.
The Company will not, and will not permit any of its
Restricted Subsidiaries to, enter into any Sale-Leaseback Transaction with
respect to any property of the Company or any of its Restricted Subsidiaries.
Notwithstanding the foregoing, the Company and its Restricted Subsidiaries may
enter into Sale-Leaseback Transactions with respect to property acquired or
constructed after the Issue Date; provided that (a) the Attributable Value of
such Sale-Leaseback Transaction shall be deemed to be Indebtedness of the
Company or such Restricted Subsidiary, as the case may be, and (b) after giving
pro forma effect to any such Sale-Leaseback Transaction and the foregoing
clause (a), the Company would be able to incur $1.00 of additional Indebtedness
pursuant to the first paragraph of Section 4.04 above (assuming a market rate
of interest with respect to such additional Indebtedness).
ARTICLE V.
SUCCESSOR CORPORATION
SECTION 5.01 Mergers, Consolidations and Sale of Assets.
(a) The Company shall not, in a single transaction or
series of related transactions, consolidate or merge with or into any person,
or sell, assign, transfer, lease, convey or otherwise dispose of (or cause or
permit any Restricted Subsidiary of the Company to sell, assign, transfer,
lease, convey or otherwise dispose of) all or substantially all of the
Company's assets (determined on a consolidated basis for the Company and the
Company's Restricted Subsidiaries) whether as an entirety or substantially as
an entirety to any person unless: (i) either (1) the Company shall be the
surviving or continuing corporation or (2) the person (if other than the
Company) formed by such consolidation or into which the Company is merged or
the person which acquires by sale, assignment, transfer, lease, conveyance or
other disposition the properties and assets of the Company and of the Company's
Restricted Subsidiaries substantially as an entirety (the "Surviving Entity")
(x) shall be a corporation organized and validly existing under the laws of the
United
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States or any State thereof or the District of Columbia and (y) shall expressly
assume, by supplemental indenture (in form and substance satisfactory to the
Trustee), executed and delivered to the Trustee, the due and punctual payment
of the principal of, and premium, if any, and interest on all of the Securities
and the performance of every covenant of the Securities, this Indenture and the
Registration Rights Agreement on the part of the Company to be performed or
observed; (ii) immediately after giving effect to such transaction and the
assumption contemplated by clause (i)(2)(y) above (including giving effect to
any Indebtedness and Acquired Indebtedness incurred or anticipated to be
incurred in connection with or in respect of such transaction), the Company or
such Surviving Entity, as the case may be, (1) shall have a Consolidated Net
Worth equal to or greater than the Consolidated Net Worth of the Company
immediately prior to such transaction and (2) shall be able to incur at least
$1.00 of additional Indebtedness pursuant to the first paragraph of Section
4.04 (assuming a market rate of interest with respect to such additional
Indebtedness) hereof; provided that in determining the Consolidated Fixed
Charge Coverage Ratio of the resulting, transferee or surviving person, such
ratio shall be calculated as if the transaction (including the incurrence of
any Indebtedness or Acquired Indebtedness) took place on the first day of the
Four Quarter Period; (iii) immediately before and immediately after giving
effect to such transaction and the assumption contemplated by clause (i)(2)(y)
above (including, without limitation, giving effect to any Indebtedness and
Acquired Indebtedness incurred or anticipated to be incurred and any Lien
granted in connection with or in respect of the transaction) no Default and no
Event of Default shall have occurred or be continuing; and (iv) the Company or
the Surviving Entity shall have delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that such consolidation,
merger, sale, assignment, transfer, lease, conveyance or other disposition and,
if a supplemental indenture is required in connection with such transaction,
such supplemental indenture comply with the applicable provisions of this
Indenture and that all conditions precedent in this Indenture relating to such
transaction have been satisfied.
(b) For purposes of the foregoing, the transfer (by
lease, assignment, sale or otherwise, in a single transaction or series of
transactions) of all or substantially all of the properties and assets of one
or more Restricted Subsidiaries of the Company, the Capital Stock of which
constitutes all or substantially all of the properties and assets of the
Company,
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shall be deemed to be the transfer of all or substantially all of the
properties and assets of the Company.
(c) Each Guarantor (other than any Guarantor whose
Guarantee is to be released in accordance with the terms of the Guarantee and
this Indenture in connection with any transaction complying with the provisions
of Section 4.16) will not, and the Company will not cause or permit any
Guarantor to, consolidate with or merge with or into any person other than the
Company or any other Guarantor unless: (i) the entity formed by or surviving
any such consolidation or merger (if other than the Guarantor), or to which
sale, lease, conveyance or other disposition shall have been made, is a
corporation organized and existing under the laws of the United States, any
state thereof or the District of Columbia; (ii) such entity assumes by
supplemental indenture all of the obligations of the Guarantor on the
Guarantee; (iii) immediately after giving effect to such transaction, no
Default or Event of Default shall have occurred and be continuing; and (iv)
immediately after giving effect to such transaction and the use of any net
proceeds therefrom on a pro forma basis, the Company could satisfy the
provisions of clause (a)(ii) of this Section 5.01.
SECTION 5.02 Successor Corporation Substituted.
Upon any such consolidation, merger, conveyance, lease or
transfer in accordance with the foregoing, the successor person formed by such
consolidation or into which the Company is merged or to which such conveyance,
lease or transfer is made will succeed to, and be substituted for, and may
exercise every right and power of, the Company under this Indenture with the
same effect as if such successor had been named as the Company therein, and
thereafter (except in the case of a sale, assignment, transfer, lease,
conveyance or other disposition) the predecessor corporation will be relieved
of all further obligations and covenants under this Indenture, the Securities
and the Registration Rights Agreement; provided that solely for purposes of
computing amounts described in subclause (C) of Section 4.03, any such
successor person shall only be deemed to have succeeded to and be substituted
for the Company with respect to periods subsequent to the effective time of
such merger, consolidation or transfer of assets.
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ARTICLE VI.
DEFAULT AND REMEDIES
SECTION 6.01 Events of Default.
An "Event of Default" occurs if:
(1) the Company fails to pay interest on any Security
when the same becomes due and payable and such failure continues for a
period of 30 days; or
(2) the Company fails to pay the principal of or premium
on any Security, when such principal or premium becomes due and
payable, whether at maturity, upon redemption or otherwise (including
the failure to make a payment to purchase Securities tendered pursuant
to a Change of Control Offer or an Asset Sale Offer); or
(3) the Company defaults in the observance or performance
of any other covenant or agreement contained in this Indenture, the
Securities or any Guarantee which default continues for a period of 30
days after (x) the Company receives written notice specifying the
default and requiring the Company to remedy the same from the Trustee
or (y) the Company and the Trustee receive such a notice from Holders
of at least 25% in principal amount of outstanding Securities; or
(4) the Company defaults under any mortgage, indenture or
instrument under which there may be issued or by which there may be
secured or evidenced any Indebtedness of the Company or of any
Restricted Subsidiary of the Company (or the payment of which is
guaranteed by the Company or any Restricted Subsidiary of the Company)
which default (a) is caused by a failure to pay principal of or
premium, if any, on such Indebtedness after any applicable grace
period provided in such Indebtedness on the date of such default (a
"payment default"), or (b) results in the acceleration of such
Indebtedness prior to its express maturity and, in each case, the
principal amount of any such Indebtedness, together with the principal
amount of any other such Indebtedness under which there has been a
payment default or the maturity of which has been so accelerated,
aggregates $5,000,000; or
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(5) the Company or any of its Significant Subsidiaries
(A) admits in writing its inability to pay its debts generally as they
become due, (B) commences a voluntary case or proceeding under any
Bankruptcy Law with respect to itself, (C) consents to the entry of a
judgment, decree or order for relief against it in an involuntary case
or proceeding under any Bankruptcy Law, (D) consents to the
appointment of a Custodian of it or for substantially all of its
property, (E) consents to or acquiesces in the institution of a
bankruptcy or an insolvency proceeding against it, (F) makes a general
assignment for the benefit of its creditors, or (G) takes any
corporate action to authorize or effect any of the foregoing; or
(6) a court of competent jurisdiction enters a judgment,
decree or order for relief in respect of the Company or any of its
Significant Subsidiaries in an involuntary case or proceeding under
any Bankruptcy Law, which shall (A) approve as properly filed a
petition seeking reorganization, arrangement, adjustment or
composition in respect of the Company or any of its Significant
Subsidiaries, (B) appoint a Custodian of the Company or any of its
Significant Subsidiaries or for substantially all of any of their
property or (C) order the winding-up or liquidation of its affairs;
and such judgment, decree or order shall remain unstayed and in effect
for a period of 60 consecutive days; or
(7) one or more judgments, orders or decrees of any court
or regulatory or administrative agency of competent jurisdiction for
the payment of money in excess of $5,000,000, either individually or
in the aggregate, shall be entered against the Company or any
Restricted Subsidiary of the Company or any of their respective
properties and shall not be discharged or fully bonded and there shall
have been a period of 60 days after the date on which any period for
appeal has expired and during which a stay of enforcement of such
judgment, order or decree shall not be in effect; or
(8) either (i) the collateral agent under the Credit
Agreement or (ii) any holder of at least $5,000,000 in aggregate
principal amount of Indebtedness of the Company or any of its
Restricted Subsidiaries shall commence judicial proceedings to
foreclose upon assets of the Company or any of its Restricted
Subsidiaries having an aggregate Fair Market Value, individually or in
the aggregate, in excess of $5,000,000 or shall have exercised any
right under
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applicable law or applicable security documents to take ownership of
any such assets in lieu of foreclosure; or
(9) any of the Guarantees cease to be in full force and
effect, or any of the Guarantees are declared to be null and void and
unenforceable or any of the Guarantees are found to be invalid or any
of the Guarantors denies its liability under its Guarantee (other than
by reason of release of a Guarantor in accordance with the terms of
this Indenture).
The Trustee shall, within 30 days after the occurrence of any
Default actually known to a Responsible Officer of the Trustee, give to the
holders of Securities notice of such Default; provided that, except in the case
of a Default in the payment of principal of or interest on any of the
Securities, the Trustee shall be protected in withholding such notice if and so
long as a Responsible Officer of the Trustee in good faith determines that the
withholding of such notice is in the interest of the Holders of Securities.
SECTION 6.02 Acceleration.
If an Event of Default (other than an Event of Default
specified in clauses (5) or (6) above) occurs and is continuing, then and in
every such case the Trustee or the Holders of not less than 25% in aggregate
principal amount of the then outstanding Securities may declare the unpaid
principal of, premium, if any, and accrued and unpaid interest on, all the
Securities then outstanding to be due and payable, by a notice in writing to
the Company (and to the Trustee, if given by Holders) and upon such declaration
such principal amount, premium, if any, and accrued and unpaid interest will
become immediately due and payable. If an Event of Default specified in clause
(5) or (6) above occurs, all unpaid principal of, and premium, if any, and
accrued and unpaid interest on, the Securities then outstanding will ipso facto
become due and payable without any declaration or other act on the part of the
Trustee or any Holder. The Holders of a majority in principal amount of the
Securities then outstanding by written notice to the Trustee may rescind an
acceleration and its consequences if (i) all existing Events of Default, other
than the non- payment of the principal of the Securities which has become due
solely by such declaration of acceleration, have been cured or waived, (ii) to
the extent the payment of such interest is lawful, interest on overdue
installments of interest and overdue principal, which has become due otherwise
than the rescission would not conflict with any judgment or decree of a court
of competent jurisdiction.
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SECTION 6.03 Other Remedies.
If an Event of Default occurs and is continuing, the Trustee
may pursue any available remedy by proceeding at law or in equity to collect
the payment of principal of or interest on the Securities or to enforce the
performance of any provision of the Securities, this Indenture or the
Guarantees.
The Trustee may maintain a proceeding even if it does not
possess any of the Securities or does not produce any of them in the
proceeding. A delay or omission by the Trustee or any Securityholder in
exercising any right or remedy accruing upon an Event of Default shall not
impair the right or remedy or constitute a waiver of or acquiescence in the
Event of Default. No remedy is exclusive of any other remedy. All available
remedies are cumulative to the extent permitted by law.
SECTION 6.04 Waiver of Past Defaults.
Subject to Sections 6.07 and 9.02, the Holders of not less
than a majority in principal amount of the outstanding Securities by written
notice to the Trustee may waive an existing Default or Event of Default and its
consequences, except a Default in the payment of principal of or interest on
any Security as specified in clauses (1) and (2) of Section 6.01. The Company
shall deliver to the Trustee an Officers' Certificate stating that the
requisite percentage of Holders have consented to such waiver and attaching
copies of such consents upon which the Trustee may conclusively rely. When a
Default or Event of Default is waived, it is cured and ceases.
SECTIN 6.05 Control by Majority.
The Holders of not less than a majority in principal amount of
the outstanding Securities may direct the time, method and place of conducting
any proceeding for any remedy available to the Trustee or exercising any trust
or power conferred on it. Subject to Section 7.01, however, the Trustee may
refuse to follow any direction that conflicts with any law or this Indenture,
that the Trustee determines may be unduly prejudicial to the rights of another
Securityholder, or that may involve the Trustee in personal liability; provided
that the Trustee may take any other action deemed proper by the Trustee which
is not inconsistent with such direction.
In the event the Trustee takes any action or follows any
direction pursuant to this Indenture, the Trustee shall be entitled to
indemnification from the Company satisfactory to it
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in its sole discretion against any loss, liability, cost or expense caused by
taking such action or following such direction.
SECTION 6.06 Limitation on Suits.
A Securityholder may not pursue any remedy with respect to
this Indenture or the Securities unless:
(1) the Holder gives to the Trustee written notice of a
continuing Event of Default;
(2) the Holder or Holders of at least 25% in principal
amount of the outstanding Securities make a written request to the
Trustee to pursue the remedy;
(3) such Holder or Holders offer and, if requested,
provide to the Trustee indemnity satisfactory to the Trustee against
any loss, liability or expense;
(4) the Trustee does not comply with the request within
30 days after receipt of the request and the offer and, if requested,
the provision of indemnity; and
(5) during such 30-day period the Holder or Holders of a
majority in principal amount of the outstanding Securities do not give
the Trustee a direction which, in the opinion of the Trustee, is
inconsistent with the request.
A Securityholder may not use this Indenture to prejudice the
rights of another Securityholder or to obtain a preference or priority over
such other Securityholder.
SECTION 6.07 Rights of Holders To Receive Payment.
Notwithstanding any other provision of this Indenture, the
right of any Holder to receive payment of principal of and interest on a
Security, on or after the respective due dates expressed in such Security, or
to bring suit for the enforcement of any such payment on or after such
respective dates, shall not be impaired or affected without the consent of the
Holder.
SECTION 6.08 Collection Suit by Trustee.
If an Event of Default in payment of principal or interest
specified in clause (1) or (2) of Section 6.01 occurs and is continuing, the
Trustee may recover judgment in its own name and as trustee of an express trust
against the Company or any other obligor on the Securities for the whole amount
of
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principal and accrued interest remaining unpaid, together with interest on
overdue principal and, to the extent that payment of such interest is lawful,
interest on overdue installments of interest, in each case at the rate per
annum borne by the Securities and such further amount as shall be sufficient to
cover the costs and expenses of collection, including the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel.
SECTION 6.09 Trustee May File Proofs of Claim.
The Trustee may file such proofs of claim and other papers or
documents as may be necessary or advisable in order to have the claims of the
Trustee (including any claim for the reasonable compensation, expenses, legal
fees, disbursements and advances of the Trustee, its agents, nominees,
custodians and counsel) and the Securityholders allowed in any judicial
proceedings relating to the Company, its creditors or its property and shall be
entitled and empowered to collect and receive any monies or other property
payable or deliverable on any such claims and to distribute the same, and any
Custodian in any such judicial proceedings is hereby authorized by each
Securityholder to make such payments to the Trustee and, in the event that the
Trustee shall consent to the making of such payments directly to the
Securityholders, to pay to the Trustee any amount due to it for the reasonable
compensation, expenses, legal fees, disbursements and advances of the Trustee,
its agents, nominees, custodians and counsel, and any other amounts due the
Trustee under Section 7.07. Nothing herein contained shall be deemed to
authorize the Trustee to authorize or consent to or accept or adopt on behalf
of any Securityholder any plan of reorganization, arrangement, adjustment or
composition affecting the Securities or the rights of any Holder thereof, or to
authorize the Trustee to vote in respect of the claim of any Securityholder in
any such proceeding.
SECTION 6.10 Priorities.
If the Trustee collects any money or property pursuant to this
Article Six, it shall pay out the money or property in the following order:
First: to the Trustee for amounts due under Section 7.07;
Second: if the Holders are forced to proceed against the
Company, a Guarantor or any other obligor on the
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Securities directly without the Trustee, to Holders for their
collection costs;
Third: to Holders for amounts due and unpaid on the
Securities for principal and interest, ratably, without preference or
priority of any kind, according to the amounts due and payable on the
Securities for principal and interest, respectively; and
Fourth: to the Company or the Guarantors, as their respective
interests may appear.
The Trustee, upon prior notice to the Company, may fix a
record date and payment date for any payment to Securityholders pursuant to
this Section 6.10.
SECTION 6.11 Undertaking for Costs.
In any suit for the enforcement of any right or remedy under
this Indenture or in any suit against the Trustee for any action taken or
omitted by it as Trustee, a court in its discretion may require the filing by
any party litigant in the suit of an undertaking to pay the costs of the suit,
and the court in its discretion may assess reasonable costs, including
reasonable attorneys' fees and expenses, against any party litigant in the
suit, having due regard to the merits and good faith of the claims or defenses
made by the party litigant. This Section 6.11 does not apply to a suit by the
Trustee, a suit by a Holder pursuant to Section 6.07, or a suit by a Holder or
Holders of more than 10% in principal amount of the outstanding Securities.
ARTICLE VII.
TRUSTEE
SECTION 7.01 Duties of Trustee.
(a) If an Event of Default actually known to a
Responsible Officer of the Trustee has occurred and is continuing, the Trustee
shall exercise such of the rights and powers vested in it by this Indenture and
use the same degree of care and skill in their exercise as a prudent person
would exercise or use under the circumstances in the conduct of his own
affairs. Subject to such provisions, the Trustee shall be under no obligation
to exercise any of its rights or powers under this
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Indenture at the request of any of the holders of Securities, unless they shall
have offered to the Trustee security and indemnity satisfactory to it.
(b) Except during the continuance of an Event of Default
actually known to a Responsible Officer of the Trustee:
(1) The Trustee need perform only those duties as are
specifically set forth herein and no others and no implied covenants
or obligations shall be read into this Indenture against the Trustee.
(2) In the absence of bad faith on its part, the Trustee
may conclusively rely, as to the truth of the statements and the
correctness of the opinions expressed therein, upon certificates or
opinions and such other documents delivered to it pursuant to Section
11.04 hereof furnished to the Trustee and conforming to the
requirements of this Indenture. However, the Trustee shall examine
the certificates and opinions to determine whether or not they conform
to the requirements of this Indenture.
(c) The Trustee may not be relieved from liability for its
own negligent action, its own negligent failure to act, or its own willful
misconduct, except that:
(1) This paragraph does not limit the effect of paragraph
(b) of this Section 7.01.
(2) The Trustee shall not be liable for any error of
judgment made in good faith by a Responsible Officer of the Trustee,
unless it is proved that the Trustee was negligent in ascertaining the
pertinent facts.
(3) The Trustee shall not be liable with respect to any
action it takes or omits to take in good faith in accordance with a
direction received by it pursuant to Section 6.05.
(d) No provision of this Indenture shall require the
Trustee to expend or risk its own funds or otherwise incur any financial
liability in the performance of any of its duties hereunder or to take or omit
to take any action under this Indenture or take any action at the request or
direction of Holders if it shall have reasonable grounds for believing that
repayment of such funds is not assured to it or it does not receive an
indemnity satisfactory to it in its sole discretion
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against such risk, liability, loss, fee or expense which might be incurred by
it in compliance with such request or direction.
(e) Every provision of this Indenture that in any way
relates to the Trustee is subject to this Section 7.01.
(f) The Trustee shall not be liable for interest on any
money received by it except as the Trustee may agree in writing with the
Company. Money held in trust by the Trustee need not be segregated from other
funds except to the extent required by law.
SECTION 7.02 Rights of Trustee.
Subject to Section 7.01:
(a) The Trustee may conclusively rely and shall be
protected in acting or refraining from acting on any document believed
by it to be genuine and to have been signed or presented by the proper
person. The Trustee need not investigate any fact or matter stated in
the document.
(b) Before the Trustee acts or refrains from acting, it
may require an Officers' Certificate and an Opinion of Counsel, which
shall conform to the provisions of Section 11.05. The Trustee shall
not be liable for any action it takes or omits to take in good faith
in reliance on such certificate or opinion.
(c) The Trustee may act through its attorneys, agents,
custodians and nominees and shall not be responsible for the
misconduct or negligence of any attorney, agent, custodian or nominee
(other than such a person who is an employee of the Trustee) appointed
with due care.
(d) The Trustee shall not be liable for any action it
takes or omits to take in good faith which it reasonably believes to
be authorized or within its rights or powers.
(e) The Trustee may consult with counsel and the advice
or opinion of such counsel as to matters of law shall be full and
complete authorization and protection from liability in respect of any
action taken, omitted or suffered by it hereunder in good faith and in
accordance with the advice or opinion of such counsel.
(f) The Trustee shall be under no obligation to exercise
any of the rights or powers vested in it by this
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Indenture at the request, order or direction of any of the Holders
pursuant to the provisions of this Indenture, unless such Holders
shall have offered to the Trustee reasonable security or indemnity
against the costs, expenses and liabilities which may be incurred
therein or thereby.
(g) The Trustee shall not be deemed to have notice or
knowledge of any matter unless a Responsible Officer assigned to and
working in the Trustee's Corporate Trust Office has actual knowledge
thereof or unless written notice thereof is received by the Trustee at
the Corporate Trust Office and such notice references the Securities
generally, the Company or this Indenture.
SECTION 7.03 Individual Rights of Trustee.
The Trustee in its individual or any other capacity may become
the owner or pledgee of Securities and may otherwise deal with the Company, its
Subsidiaries, or their respective Affiliates with the same rights it would have
if it were not Trustee. Any Agent may do the same with like rights. However,
the Trustee must comply with Sections 7.10 and 7.11.
SECTION 7.04 Trustee's Disclaimer.
The Trustee shall not be responsible for and makes no
representation as to the validity or adequacy of this Indenture or the
Securities, it shall not be accountable for the Company's use of the proceeds
from the Securities, and it shall not be responsible for any statement of the
Company in this Indenture or any document issued in connection with the sale of
Securities or any statement in the Securities other than the Trustee's
certificate of authentication. The Trustee makes no representations with
respect to the effectiveness or adequacy of this Indenture. The Trustee shall
not be responsible for independently ascertaining or maintaining such validity,
if any, and shall be fully protected in relying upon certificates and opinions
delivered to it in accordance with the terms of this Indenture.
SECTION 7.05 Notice of Default.
If a Default or an Event of Default occurs and is continuing
and a Responsible Officer of the Trustee receives actual notice of such event,
the Trustee shall mail to each Securityholder, as their names and addresses
appear on the Securityholder list described in Section 2.05, notice of the
uncured Default or Event of Default within 30 days after the
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Trustee receives such notice. Except in the case of a Default or an Event of
Default in payment of principal of, or interest on, any Security, including the
failure to make payment on (i) the Change of Control Purchase Date pursuant to
a Change of Control Offer or (ii) the Excess Proceeds Payment Date pursuant to
an Asset Sale Offer, or the Trustee may withhold the notice if and so long as
the board of directors, the executive committee, or a trust committee of
directors, of the Trustee in good faith determines that withholding the notice
is in the interest of the Securityholders.
SECTION 7.06 Reports by Trustee to Holders.
This Section 7.06 shall not be operative as a part of this
Indenture until this Indenture is qualified under the TIA, and, until such
qualification, this Indenture shall be construed as if this Section 7.06 were
not contained herein.
Within 60 days after each May 15 of each year beginning with
1996, the Trustee shall, to the extent that any of the events described in TIA
Section 313(a) occurred within the previous twelve months, but not otherwise,
mail to each Securityholder a brief report dated as of such date that complies
with TIA Section 313(a). The Trustee also shall comply with TIA Sections
313(b), 313(c) and 313(d).
A copy of each report at the time of its mailing to
Securityholders shall be mailed to the Company and filed with the SEC and each
securities exchange, if any, on which the Securities are listed.
The Company shall notify a Responsible Officer of the Trustee
if the Securities become listed on any securities exchange or of any delisting
thereof.
SECTION 7.07 Compensation and Indemnity.
The Company shall pay to the Trustee from time to time
reasonable compensation for its services hereunder. The Trustee's compensation
shall not be limited by any law on compensation of a trustee of an express
trust. The Company shall reimburse the Trustee upon request for all reasonable
disbursements, expenses and advances (including reasonable fees and expenses of
counsel) incurred or made by it in addition to the compensation for its
services, except any such disbursements, expenses and advances as may be
attributable to the Trustee's negligence or bad faith. Such expenses shall
include the reasonable compensation, legal fees, disbursements and expenses
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of the Trustee's agents, accountants, experts, nominees, custodians and counsel
and any taxes or other expenses incurred by a trust created pursuant to Section
8.01 hereof.
The Company shall indemnify the Trustee, its directors,
officers and employees and each predecessor trustee for, and hold it harmless
against, any loss, liability or expense incurred by the Trustee without
negligence or bad faith on its part arising out of or in connection with the
administration of this trust and its duties under this Indenture, including the
reasonable expenses and attorneys' fees of defending itself against any claim
of liability arising hereunder. The Trustee shall notify the Company promptly
of any claim asserted against the Trustee for which it may seek indemnity.
However, the failure by the Trustee to so notify the Company shall not relieve
the Company of its obligations hereunder. The Company shall defend the claim
and the Trustee shall cooperate in the defense (and may employ its own counsel)
at the Company's expense. The Company need not pay for any settlement made
without its written consent, which consent shall not be unreasonably withheld
or delayed. The Company need not reimburse any expense or indemnify against
any loss or liability incurred by the Trustee as a result of the violation of
this Indenture by the Trustee if such violation arose from the Trustee's
negligence or bad faith.
To secure the Company's payment obligations in this Section
7.07, the Trustee shall have a senior claim prior to the Securities against all
money or property held or collected by the Trustee, in its capacity as Trustee.
When the Trustee incurs expenses or renders services after an
Event of Default specified in clause (5) or (6) of Section 6.01 occurs, the
expenses (including the reasonable fees and expenses of its agents and counsel)
and the compensation for the services shall be preferred over the status of the
Holders in a proceeding under any Bankruptcy Law and are intended to constitute
expenses of administration under any Bankruptcy Law. The Company's obligations
under this Section 7.07 and any claim arising hereunder shall survive the
resignation or removal of any Trustee, the discharge of the Company's
obligations pursuant to Article Eight and any rejection or termination under
any Bankruptcy Law.
SECTION 7.08 Replacement of Trustee.
The Trustee may resign at any time by so notifying the Company
in writing. The Holders of a majority in principal amount of the outstanding
Securities may remove the Trustee by so
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notifying the Company and the Trustee in writing and may appoint a successor
trustee with the Company's consent. The Company may remove the Trustee if:
(1) the Trustee fails to comply with Section 7.10;
(2) the Trustee is adjudged a bankrupt or an insolvent;
(3) a receiver or other public officer takes charge of
the Trustee or its property; or
(4) the Trustee becomes legally incapable of acting with
respect to its duties hereunder.
If the Trustee resigns or is removed or if a vacancy exists in
the office of Trustee for any reason, the Company shall notify each Holder of
such event and shall promptly appoint a successor Trustee. Within one year
after the successor Trustee takes office, the Holders of a majority in
principal amount of the Securities may appoint a successor Trustee to replace
the successor Trustee appointed by the Company.
A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Company. Immediately after
that, the retiring Trustee shall transfer, after payment of all sums then owing
to the Trustee pursuant to Section 7.07, all property held by it as Trustee to
the successor Trustee, subject to the lien provided in Section 7.07, the
resignation or removal of the retiring Trustee shall become effective, and the
successor Trustee shall have all the rights, powers and duties of the Trustee
under this Indenture; provided, however, that no Trustee under this Indenture
shall be liable for any act or omission of any successor Trustee. A successor
Trustee shall mail notice of its succession to each Securityholder.
If a successor Trustee does not take office within 30 days
after the retiring Trustee resigns or is removed, the retiring Trustee, the
Company or the Holders of at least 10% in principal amount of the outstanding
Securities may petition any court of competent jurisdiction for the appointment
of a successor Trustee.
If the Trustee fails to comply with Section 7.10, any
Securityholder may petition any court of competent jurisdiction for the removal
of the Trustee and the appointment of a successor Trustee.
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Notwithstanding replacement of the Trustee pursuant to this
Section 7.08, the Company's obligations under Section 7.07 shall continue for
the benefit of the retiring Trustee and the Company shall pay to any such
replaced or removed Trustee all amounts owed under Section 7.07 upon such
replacement or removal.
SECTION 7.09 Successor Trustee by Merger, Etc.
If the Trustee consolidates with, merges or converts into, or
transfers all or substantially all of its corporate trust business to, another
corporation, the resulting, surviving or transferee corporation without any
further act shall, if such resulting, surviving or transferee corporation is
otherwise eligible hereunder, be the successor Trustee. In case any Securities
shall have been authenticated, but not delivered, by the Trustee then in
office, any successor by merger, conversion or consolidation to such
authenticating Trustee may adopt such authentication and deliver the Securities
so authenticated with the same effect as if such successor Trustee had itself
authenticated such Securities.
SECTION 7.10 Eligibility; Disqualification.
This Indenture shall always have a Trustee who satisfies the
requirement of TIA Sections 310(a)(1) and 310(a)(5). The Trustee shall
have a combined capital and surplus of at least $50,000,000 as set forth in its
most recent published annual report of condition. The Trustee shall comply
with TIA Section 310(b); provided, however, that there shall be excluded from
the operation of TIA Section 310(b)(1) any indenture or indentures under which
other securities, or certificates of interest or participation in other
securities, of the Company are outstanding, if the requirements for such
exclusion set forth in TIA Section 310(b)(1) are met.
SECTION 7.11 Preferential Collection of Claims Against Company.
The Trustee, in its capacity as Trustee hereunder shall comply
with TIA Section 311(a), excluding any creditor relationship listed in TIA
Section 311(b). A Trustee who has resigned or been removed shall be subject
to TIA Section 311(a) to the extent indicated.
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ARTICLE VIII.
SATISFACTION AND DISCHARGE OF INDENTURE
SECTION 8.01 Legal Defeasance and Covenant Defeasance.
(a) The Company may, at its option by Board Resolution,
at any time, with respect to the Securities, elect to have either paragraph (b)
or paragraph (c) below be applied to the outstanding Securities upon compliance
with the conditions set forth in paragraph (d).
(b) Upon the Company's exercise under paragraph (a) of
the option applicable to this paragraph (b), the Company shall be deemed to
have been released and discharged from its obligations with respect to the
outstanding Securities on the date the conditions set forth below are satisfied
(hereinafter, "Legal Defeasance"). For this purpose, such Legal Defeasance
means that the Company shall be deemed to have paid and discharged the entire
indebtedness represented by the outstanding Securities, which shall thereafter
be deemed to be "outstanding" only for the purposes of the Sections and matters
under this Indenture referred to in (i) and (ii) below, and to have satisfied
all its other obligations under such Securities and this Indenture insofar as
such Securities are concerned, except for the following, which shall survive
until otherwise terminated or discharged hereunder: (i) the rights of the
Holders of outstanding Securities to receive payment in respect of the
principal of, premium, if any, and interest on such Securities when such
payments are due, (ii) the Company's obligations to issue temporary Securities,
register the transfer or exchange of any Securities, replace mutilated,
destroyed, lost or stolen Securities and maintain an office or agency for
payments in respect of the Securities, (iii) the rights, powers, trusts, duties
and immunities of the Trustee, and (iv) the defeasance provisions of this
Indenture. The Company may exercise its option under this paragraph (b)
notwithstanding the prior exercise of its option under paragraph (c) below with
respect to the Securities.
(c) Upon the Company's exercise under paragraph (a) of
the option applicable to this paragraph (c), the Company shall be released and
discharged from its obligations under any covenant contained in Article 5 and
in Sections 4.03 through 4.18 with respect to the outstanding Securities on and
after the date the conditions set forth below are satisfied (hereinafter,
"Covenant Defeasance"), and the Securities shall thereafter be deemed to be
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not "outstanding" for the purpose of any direction, waiver, consent or
declaration or act of Holders (and the consequences of any thereof) in
connection with such covenants, but shall continue to be deemed "outstanding"
for all other purposes hereunder. For this purpose, such Covenant Defeasance
means that, with respect to the outstanding Securities, the Company and any
Guarantor may omit to comply with and shall have no liability in respect of any
term, condition or limitation set forth in any such covenant, whether directly
or indirectly, by reason of any reference elsewhere herein to any such covenant
or by reason of any reference in any such covenant to any other provision
herein or in any other document and such omission to comply shall not
constitute a Default or an Event of Default under Section 6.01(3), nor shall
any event referred to in Section 6.01(4), (7) or (8) thereafter constitute a
Default or an Event of Default thereunder but, except as specified above, the
remainder of this Indenture and such Securities shall be unaffected thereby.
(d) The following shall be the conditions to application
of either paragraph (b) or paragraph (c) above to the outstanding Securities:
(1) The Company shall have irrevocably deposited in trust
with the Trustee, pursuant to an irrevocable trust and security
agreement in form and substance satisfactory to the Trustee, U.S.
Legal Tender or direct non-callable obligations of, or non-callable
obligations guaranteed by, the United States of America for the
payment of which obligation or guarantee the full faith and credit of
the United States of America is pledged ("U.S. Government
Obligations") maturing as to principal and interest in such amounts
and at such times as are sufficient, without consideration of the
reinvestment of such interest and after payment of all Federal, state
and local taxes or other charges or assessments in respect thereof
payable by the Trustee, in the opinion of a nationally recognized
firm of independent public accountants expressed in a written
certification thereof (in form and substance reasonably satisfactory
to the Trustee) delivered to the Trustee, to pay the principal of,
premium, if any, and interest on all the outstanding Securities on the
dates on which any such payments are due and payable in accordance
with the terms of this Indenture and of the Securities;
(2) Such deposits shall not cause the Trustee to have a
conflicting interest as defined in and for purposes of the TIA;
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(3) The Trustee shall have received Officers'
Certificates stating that No Default of Event of Default or event
which with notice or lapse of time or both would become a Default or
an Event of Default with respect to the Securities shall have occurred
and be continuing on the date of such deposit or, insofar as Section
6.01(5) or (6) is concerned, at any time during the period ending on
the 91st day after the date of such deposit (it being understood that
this condition shall not be deemed satisfied until the expiration of
such period);
(4) The Trustee shall have received Officers'
Certificates stating that such deposit will not result in a Default
under this Indenture or a breach or violation of, or constitute a
default under, any other material instrument or agreement to which the
Company or any of its Subsidiaries is a party or by which it or its
property is bound;
(5) (i) In the event the Company elects paragraph (b)
hereof, the Company shall deliver to the Trustee an Opinion of
Counsel, in form and substance reasonably satisfactory to the Trustee
to the effect that (A) the Company has received from, or there has
been published by, the Internal Revenue Service a ruling or (B) since
the Issue Date, there has been a change in the applicable federal
income tax law, in either case to the effect that, and based thereon
such Opinion of Counsel shall state that Holders of the Securities
will not recognize income gain or loss for Federal income tax purposes
as a result of such deposit and the defeasance contemplated hereby and
will be subject to Federal income taxes in the same manner and at the
same times as would have been the case of such deposit and defeasance
had not occurred, or (ii) in the event the Company elects paragraph
(c) hereof, the Company shall deliver to the Trustee an Opinion of
Counsel, in form and substance reasonably satisfactory to the Trustee,
to the effect that, Holders of the Securities will not recognize
income, gain or loss for Federal income tax purposes as a result of
such deposit and the defeasance contemplated hereby and will be
subject to Federal income tax in the same amounts and in the same
manner and at the same times as would have been the case if such
deposit and defeasance had not occurred;
(6) The deposit shall not result in the Company, the
Trustee or the trust becoming or being deemed to be an "investment
company" under the Investment Company Act of 1940, as amended;
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(7) The Company shall have delivered to the Trustee an
Officers' Certificate, in form and substance reasonably satisfactory
to the Trustee, stating that the deposit under clause (1) was not made
by the Company or any Subsidiary with the intent of defeating,
hindering, delaying or defrauding any other creditors of the Company
or any Subsidiary or others;
(8) The Company shall have delivered to the Trustee an
Opinion of Counsel, in form and substance reasonably satisfactory to
the Trustee, to the effect that, (A) the trust funds will not be
subject to the rights of holders of Indebtedness of the Company or any
Guarantor other than the Securities and (B) assuming no intervening
bankruptcy of the Company between the date of deposit and the 91st day
following the deposit and that no Holder of Securities is an insider
of the Company, after the passage of 90 days following the deposit,
the trust funds will not be subject to any applicable bankruptcy,
insolvency, reorganization or similar law affecting creditors' rights
generally; and
(9) The Company has delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all
conditions precedent specified herein relating to the defeasance
contemplated by this Section 8.01 have been complied with; provided,
however, that no deposit under clause (1) above shall be effective to
terminate the obligations of the Company under the Securities or this
Indenture prior to 90 days following any such deposit.
In the event all or any portion of the Securities are to be
redeemed through such irrevocable trust, the Company must make arrangements
satisfactory to the Trustee, at the time of such deposit, for the giving of the
notice of such redemption or redemptions by the Trustee in the name and at the
expense of the Company.
SECTION 8.02 Satisfaction and Discharge.
In addition to the Company's rights under Section 8.01, the
Company may terminate all of its obligations under this Indenture (subject to
Section 8.03) when:
(1) all Securities theretofore authenticated and
delivered (other than Securities which have been destroyed, lost or
stolen and which have been replaced or paid as provided in Section
2.07) have been delivered to the Trustee for cancellation; or
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(2) all Securities not theretofore delivered to the
Trustee for cancellation (except lost, stolen or destroyed Securities
which have been replaced or paid) have been called for redemption
pursuant to the terms of the Securities or have otherwise become due
and payable and the Company has irrevocably deposited or caused to be
deposited with the Trustee funds in an amount sufficient to pay and
discharge the entire Indebtedness on the Securities not theretofore
delivered to the Trustee for cancellation, for principal of, premium,
if any, and interest on the Securities to the date of deposit together
with irrevocable instructions from the Company directing the Trustee
to apply such funds to the payment thereof at maturity or redemption,
as the case may be; and
(3) the Company has paid or caused to be paid all other
sums payable hereunder and under the Securities by the Company; and
(4) there exists no Default or Event of Default under
this Indenture; and
(5) the Company has delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all
conditions precedent specified herein relating to the satisfaction and
discharge of this Indenture have been complied with.
SECTION 8.03 Survival of Certain Obligations.
Notwithstanding the satisfaction and discharge of this
Indenture and of the Securities referred to in Section 8.01 or 8.02, the
respective obligations of the Company and the Trustee under Sections 2.02,
2.03, 2.04, 2.05, 2.06, 2.07, 2.10, 2.12, 2.13, 4.01, 4.02 and 6.07, Article
Seven and Sections 8.05, 8.06 and 8.07 shall survive until the Securities are
no longer outstanding, and thereafter the obligations of the Company and the
Trustee under Sections 7.07, 8.05, 8.06 and 8.07 shall survive. Nothing
contained in this Article Eight shall abrogate any of the rights, obligations
or duties of the Trustee under this Indenture.
SECTION 8.04 Acknowledgment of Discharge by Trustee.
Subject to Section 8.07, after (i) the conditions of Section
8.01 or 8.02 have been satisfied, (ii) the Company has paid or caused to be
paid all other sums payable hereunder by the Company and (iii) the Company has
delivered to the Trustee an
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Officers' Certificate and an Opinion of Counsel, each stating that all
conditions precedent referred to in clause (i) above relating to the
satisfaction and discharge of this Indenture have been complied with, the
Trustee upon written request shall acknowledge in writing the discharge of the
Company's obligations under this Indenture except for those surviving
obligations specified in Section 8.03.
SECTION 8.05 Application of Trust Assets.
The Trustee shall hold any U.S. Legal Tender or U.S.
Government Obligations deposited with it in the irrevocable trust established
pursuant to Section 8.01. The Trustee shall apply the deposited U.S. Legal
Tender or the U.S. Government Obligations, together with earnings thereon,
through the Paying Agent, in accordance with this Indenture and the terms of
the irrevocable trust agreement established pursuant to Section 8.01, to the
payment of principal of and interest on the Securities. The U.S. Legal Tender
or U.S. Government Obligations so held in trust and deposited with the Trustee
in compliance with Section 8.01 shall not be part of the trust estate under
this Indenture, but shall constitute a separate trust fund for the benefit of
all Holders entitled thereto.
SECTION 8.06 Repayment to the Company or Guarantors; Unclaimed Money.
Subject to Sections 7.07, 8.01, the Trustee shall promptly pay
to the Company, or if deposited with the Trustee by any Guarantor, to such
Guarantor, upon receipt by the Trustee of an Officers' Certificate, any excess
money, determined in accordance with Section 8.01, held by it at any time. The
Trustee and the Paying Agent shall pay to the Company or any Guarantor, as the
case may be, upon receipt by the Trustee or the Paying Agent, as the case may
be, of an Officers' Certificate, any money held by it for the payment of
principal, premium, if any, or interest that remains unclaimed for two years
after payment to the Holders is required; provided, however, that the Trustee
and the Paying Agent before being required to make any payment may, but need
not, at the expense of the Company cause to be published once in a newspaper of
general circulation in the City of New York or mail to each Holder entitled to
such money notice that such money remains unclaimed and that after a date
specified therein, which shall be at least 30 days from the date of such
publication or mailing, any unclaimed balance of such money then remaining will
be repaid to the Company. After payment to the Company of any Guarantor, as
the case may be, Security holders entitled to money must look solely to the
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Company for payment as general creditors unless an applicable abandoned
property law designates another person, and all liability of the Trustee or
Paying Agent with respect to such money shall thereupon cease.
SECTION 8.07 Reinstatement.
If the Trustee or Paying Agent is unable to apply any money or
U.S. Government Obligations in accordance with this Indenture by reason of any
legal proceeding or by reason of any order or judgment of any court or
governmental authority enjoining, restraining or otherwise prohibiting such
application, then and only then the Company's and each Guarantor's, if any,
obligations under this Indenture and the Securities shall be revived and
reinstated as though no deposit had been made pursuant to this Indenture until
such time as the Trustee is permitted to apply all such money or U.S.
Government Obligations in accordance with this Indenture; provided, however,
that if the Company or the Guarantors, as the case may be, have made any
payment of principal of, premium, if any, or interest on any Securities because
of the reinstatement of their obligations, the Company or the Guarantors, as
the case may be, shall be, subrogated to the rights of the holders of such
Securities to receive such payment from the money or U.S. Government
Obligations held by the Trustee or Paying Agent.
ARTICLE IX.
AMENDMENTS, SUPPLEMENTS AND WAIVERS
SECTION 9.01 Without Consent of Holders.
The Company and the Guarantors (when authorized by Board
Resolutions), and the Trustee, together, may amend or supplement this Indenture
or the Securities without notice to or consent of any Securityholder:
(1) to cure any ambiguity, defect or inconsistency;
(2) to evidence the succession in accordance with
Article V hereof of another person to the Company or a Guarantor and
the assumption by any such successor of the covenants of the Company or
a Guarantor herein and in the Securities or a Guarantee, as the case
may be;
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(3) to provide for uncertificated Securities in addition
to or in place of certificated Securities;
(4) to make any other change that does not materially
adversely affect the rights of any Securityholders hereunder; or
(5) to comply with any requirements of the SEC in
connection with the qualification of this Indenture under the TIA; or
(6) to add or release any Guarantor pursuant to the terms
of this Indenture.
provided that each of the Company and the Guarantors has delivered to the
Trustee an Opinion of Counsel and an Officers' Certificate, each stating that
such amendment or supplement complies with the provisions of this Section 9.01.
SECTION 9.02 With Consent of Holders.
Subject to Section 6.07, the Company and the Guarantors (when
authorized by Board Resolutions) and the Trustee, together, with the written
consent of the Holder or Holders of at least a majority in aggregate principal
amount of the outstanding Securities, may amend or supplement this Indenture or
the Securities, without notice to any other Securityholders. Subject to
Section 6.07, the Holder or Holders of a majority in aggregate principal amount
of the outstanding Securities may waive compliance by the Company with any
provision of this Indenture or the Securities without notice to any other
Securityholder. Without the consent of each Securityholder affected, however,
no amendment, supplement or waiver, including a waiver pursuant to Section
6.04, may:
(1) change the principal amount of Securities whose
Holders must consent to an amendment, supplement or waiver of any
provision of this Indenture, the Securities or the Guarantees;
(2) reduce the rate or change the time for payment of
interest, including default interest, on any Security;
(3) reduce the principal amount of any Security;
(4) change the Final Maturity Date of any Security, or
alter the redemption or repurchase provisions contained in
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this Indenture or the Securities in a manner adverse to any Holder;
(5) make any change in provisions of this Indenture
protecting the right of each Holder to receive payment of principal of
and interest on such Security on or after the due date thereof or to
bring suit to enforce such payment, or permitting Holders of a
majority in principal amount of the Securities to waive Defaults or
Events of Default;
(6) make any changes in Section 6.04, 6.07 or this
Section 9.02;
(7) make the principal of, or the interest on any
Security payable in money other than as provided for in this
Indenture, the Securities and the Guarantees as in effect on the date
hereof;
(8) affect the ranking of the Securities or the
Guarantees, in each case in a manner adverse to the Holders;
(9) amend, modify or change the obligation of the Company
to make or consummate a Change of Control Offer an Asset Sale Offer or
waive any default in the performance thereof or modify any of the
provisions or definitions with respect to any such offers; or
(10) release any Guarantor from any of its obligations
under its Guarantee or this Indenture otherwise than in accordance
with the terms of this Indenture.
It shall not be necessary for the consent of the Holders under
this Section 9.02 to approve the particular form of any proposed amendment,
supplement or waiver, but it shall be sufficient if such consent approves the
substance thereof.
After an amendment, supplement or waiver under this Section
9.02 becomes effective, the Company shall mail to the Holders affected thereby
a notice briefly describing the amendment, supplement or waiver. Any failure
of the Company to mail such notice, or any defect therein, shall not, however,
in any way impair or affect the validity of any such supplemental indenture.
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SECTION 9.03 Compliance with TIA.
From the date on which this Indenture is qualified under the
TIA, every amendment, waiver or supplement of this Indenture or the Securities
shall comply with the TIA as then in effect.
SECTION 9.04 Revocation and Effect of Consents.
Until an amendment, waiver or supplement becomes effective, a
consent to it by a Holder is a continuing consent by the Holder and every
subsequent Holder of a Security or portion of a Security that evidences the
same debt as the consenting Holder's Security, even if notation of the consent
is not made on any Security. However, any such Holder or subsequent Holder may
revoke the consent as to his Security or portion of his Security by notice to
the Trustee or the Company received before the date on which the Trustee
receives an Officers' Certificate certifying that the Holders of the requisite
principal amount of Securities have consented (and not theretofore revoked such
consent) to the amendment, supplement or waiver.
The Company may, but shall not be obligated to, fix a record
date for the purpose of determining the Holders entitled to consent to any
amendment, supplement or waiver, which record date shall be at least 30 days
prior to the first solicitation of such consent. If a record date is fixed,
then notwithstanding the last sentence of the immediately preceding paragraph,
those persons who were Holders at such record date (or their duly designated
proxies), and only those persons, shall be entitled to revoke any consent
previously given, whether or not such persons continue to be Holders after such
record date. No such consent shall be valid or effective for more than 90 days
after such record date.
After an amendment, supplement or waiver becomes effective, it
shall bind every Securityholder, unless it makes a change described in any of
clauses (1) through (10) of Section 9.02, in which case, the amendment,
supplement or waiver shall bind only each Holder of a Security who has
consented to it and every subsequent Holder of a Security or portion of a
Security that evidences the same debt as the consenting Holder's Security;
provided that any such waiver shall not impair or affect the right of any
Holder to receive payment of principal of and interest on a Security, on or
after the respective due dates expressed in such Security, or to bring suit for
the enforcement of any such payment on or after such respective dates without
the consent of such Holder.
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SECTION 9.05 Notation on or Exchange of Securities.
If an amendment, supplement or waiver changes the terms of a
Security, the Trustee may require the Holder of the Security to deliver it to
the Trustee. The Trustee may place an appropriate notation on the Security
about the changed terms and return it to the Holder. Alternatively, if the
Company or the Trustee so determines, the Company in exchange for the Security
shall issue and the Trustee shall authenticate a new Security that reflects the
changed terms.
SECTION 9.06 Trustee To Sign Amendments, Etc.
The Trustee shall execute any amendment, supplement or waiver
authorized pursuant to this Article Nine; provided that the Trustee may, but
shall not be obligated to, execute any such amendment, supplement or waiver
which affects the Trustee's own rights, duties or immunities under this
Indenture. The Trustee shall be entitled to receive, and shall be fully
protected in relying upon, an Opinion of Counsel and an Officers' Certificate
each stating that the execution of any amendment, supplement or waiver
authorized pursuant to this Article Nine is authorized or permitted by this
Indenture and constituted the legal, valid and binding obligations of the
Company enforceable in accordance with its terms. Such Opinion of Counsel
shall be at the expense of the Company, and the Trustee shall have a lien under
Section 7.07 for any such expense.
ARTICLE X.
GUARANTEE
SECTION 10.01 Unconditional Guarantee.
Each Guarantor hereby unconditionally, jointly and severally,
guarantees (such guarantee to be referred to herein as the "Guarantee") to each
Holder of a Security authenticated and delivered by the Trustee and to the
Trustee and its successors and assigns, the Securities or the Obligations of
the Company hereunder or thereunder, that: (i) the principal of and interest
on the Securities will be promptly paid in full when due, subject to any
applicable grace period, whether at maturity, by acceleration or otherwise and
interest on the overdue principal, if any, and interest on any interest, to the
extent lawful, of the Securities and all other Obligations of the Company to
the Holders or the Trustee hereunder or thereunder will be promptly paid in
full or performed, all in accordance with the terms
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hereof and thereof; and (ii) in case of any extension of time of payment or
renewal of any Securities or of any such other Obligations, the same will be
promptly paid in full when due or performed in accordance with the terms of the
extension or renewal, subject to any applicable grace period, whether at stated
maturity, by acceleration or otherwise, subject, however, in the case of
clauses (i) and (ii) above, to the limitations set forth in Section 10.03.
Each Guarantor hereby agrees that its obligations hereunder shall be
unconditional, irrespective of the validity, regularity or enforceability of
the Securities or this Indenture, the absence of any action to enforce the
same, any waiver or consent by any Holder of the Securities with respect to any
provisions hereof or thereof, the recovery of any judgment against the
Company, and action to enforce the same or any other circumstance which might
otherwise constitute a legal or equitable discharge or defense of a guarantor.
Each Guarantor hereby waives diligence, presentment, demand of payment, filing
of claims with a court in the event of insolvency or bankruptcy of the Company,
any right to require a proceeding first against the Company, protest, notice
and all demands whatsoever and covenants that this Guarantee will not be
discharged except by complete performance of the obligations contained in the
Securities, this Indenture and in this Guarantee. If any Securityholder or the
Trustee is required by any court or otherwise to return to the Company, any
Guarantor, or any custodian, trustee, liquidator or other similar official
acting in relation to the Company or any Guarantor, or any custodian, trustee,
liquidator or other similar official acting in relation to the Company or any
Guarantor, any amount paid by the Company or any Guarantor to the Trustee or
such Securityholder, this Guarantee, to the extent theretofore discharged,
shall be reinstated in full force and effect. Each Guarantor further agrees
that, as between each Guarantor, on the one hand, and the Holders and the
Trustee, on the other hand, (x) the maturity of the obligations guaranteed
hereby may be accelerated as provided in Article Six for the purposes of this
Guarantee, notwithstanding any stay, injunction or other prohibition preventing
such acceleration in respect of the obligations guaranteed hereby, and (y) in
the event of any acceleration of such obligations as provided in Article Six,
such obligations (whether or not due and payable) shall forthwith become due
and payable by each Guarantor for the purpose of this Guarantee.
SECTION 10.02 Severability.
In case any provision of this Guarantee shall be invalid,
illegal or unenforceable, the validity, legality, and
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enforceability of the remaining provisions shall not in any way be affected or
impaired thereby.
SECTION 10.03 Release of a Guarantor.
If all of the assets of any Guarantor or all of the Capital
Stock of any Guarantor is sold (including by issuance or otherwise) by the
Company or any of its Subsidiaries in a transaction constituting an Asset Sale,
and if the Net Cash Proceeds from such Asset Sale are used in accordance with
Section 4.16, then such Guarantor (in the event of a sale or other disposition
of all of the Capital Stock of such Guarantor) or the corporation or other
entity acquiring such assets (in the event of a sale or other disposition of
all or substantially all of the assets of such Guarantor) shall be released and
discharged of its Guarantee obligations.
The Trustee shall deliver an appropriate instrument evidencing
such release upon receipt of a request by the Company accompanied by an
Officers' Certificate and Opinion of Counsel certifying as to the compliance
with this Section 10.03. Any Guarantor not so released remains liable for the
full amount of principal of an interest on the Securities as provided in this
Article Ten.
SECTION 10.04 Limitation of Guarantor's Liability.
Each Guarantor and by its acceptance hereof each Holder hereby
confirms that it is the intention of all such parties that the guarantee by
such Guarantor pursuant to its Guarantee not constitute a fraudulent transfer
or conveyance for purposes of the Bankruptcy Law, the Uniform Fraudulent
Conveyance Act, the Uniform Fraudulent Transfer Act or any similar Federal or
state law. To effectuate the foregoing intention, the Holders and such
Guarantor hereby irrevocably agree that the obligations of such Guarantor under
the Guarantee shall be limited to the maximum amount as will, after giving
effect to all other contingent and fixed liabilities of such Guarantor and
after giving effect to any collections from or payments made by or on behalf of
any other Guarantor in respect of the obligations of such other Guarantor under
its Guarantee or pursuant to Section 10.05, result in the obligations of such
Guarantor under the Guarantee not constituting such fraudulent transfer or
conveyance.
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SECTION 10.05 Guarantors May Consolidate, etc., on Certain Terms.
(a) Nothing contained in this Indenture or in any of the
Securities shall prevent any consolidation or merger of a Guarantor with or
into the Company or another Guarantor or shall prevent any sale of assets or
conveyance of the property of a Guarantor as an entirety or substantially as an
entirety, to the Company or another Guarantor. Upon any such consolidation,
merger, sale or conveyance, the Guarantee given by such Guarantor shall no
longer have any force or effect.
(b) Except as set forth in Article Four and Article Five
hereof, nothing contained in this Indenture or in any of the Securities shall
prevent any consolidation or merger of a Guarantor with or into a corporation
or corporations other than the Company or another Guarantor (whether or not
affiliated with the Guarantor) or shall prevent any sale of assets of
conveyance of the property of a Guarantor as an entirety or substantially as an
entirety, to a corporation or corporations other than the Company or another
Guarantor (whether or not affiliated with the Guarantor); provided, however,
that, (i) immediately after such transaction, and giving effect thereto such
transaction does not (A) violate any covenants set forth herein or (B) result
in a Default or Event of Default under this Indenture that is continuing, and
(ii) upon any such consolidation, merger, sale or conveyance, the Guarantee set
forth in this Article Ten, and the due and punctual performance and observance
of all of the covenants and conditions of this Indenture to be performed by
such Guarantor, shall be expressly assumed (in the event that the Guarantor is
not the surviving corporation in the merger), by supplemental indenture
satisfactory in form to the Trustee, executed and delivered to the Trustee, by
the corporation formed by such consolidation, or into which the Guarantor shall
have merged, or by the corporation that shall have acquired such property. In
the case of any such consolidation, merger, sale or conveyance and upon the
assumption by the successor corporation, by supplemental indenture executed and
delivered to the Trustee and satisfactory in form to the Trustee of the due and
punctual performance of all of the convenants and conditions of this Indenture
to be performed by the Guarantor, such successor corporation shall succeed to
and be substituted for the Guarantor with the same effect as if it had been
named herein as a Guarantor; provided, however, that solely for purposes of
computing amounts described in subclause (C) of Section 4.03 any such successor
corporation shall only be deemed to have succeeded to and be substituted for
any Guarantor with respect to periods
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subsequent to the effective time of such merger, consolidation or transfer of
assets.
(c) The Trustee shall deliver an appropriate instrument
evidencing such release upon receipt of a request by the Company accompanied by
an Officers' Certificate and Opinion of Counsel certifying as to the compliance
with this Section 10.04. Any Guarantor not so released remains liable for the
full amount of principal of and interest on the Securities as provided in this
Article Ten.
SECTION 10.06 Contribution.
In order to provide for just and equitable contribution among
the Guarantors, the Guarantors agree, inter se, that in the event any payment
or distribution is made by any Guarantor (a "Funding Guarantor") under the
Guarantee, such Funding Guarantor shall be entitled to a contribution from all
other Guarantors in a pro rata amount based on the Adjusted Net Assets of each
Guarantor (including the Funding Guarantor) for all payments, damages and
expenses incurred by that Funding Guarantor in discharging the Company's
obligations with respect to the Securities or any other Guarantor's obligations
with respect to the Guarantee. "Adjusted Net Assets" of such Guarantor at any
date shall mean the lesser of the amount by which (x) the fair value of the
property of such Guarantor exceeds the total amount of liabilities, including,
without limitation, contingent liabilities (after giving effect to all other
fixed and contingent liabilities incurred or assumed on such date (other than
liabilities of such Guarantor under Indebtedness Subordinated to such
Guarantor's Guarantee)), but excluding liabilities under the Guarantee, of such
Guarantor at such date and (y) the present fair salable value of the assets of
such Guarantor at such date exceeds the amount that will be required to pay the
probable liability of such Guarantor on its debts (after giving effect to all
other fixed and contingent liabilities incurred or assumed on such date and
after giving effect to any collection from any Subsidiary of such Guarantor in
respect of the obligations of such Subsidiary under the Guarantee), excluding
debt in respect of the Guarantee of such Guarantor, as they become absolute and
matured.
SECTION 10.07 Waiver of Subrogation.
Until all Guarantee Obligations are paid in full each
Guarantor hereby irrevocably waives any claims or other rights which it may now
or hereafter acquire against the Company that arise from the existence,
payment, performance or enforcement of
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such Guarantor's obligations under the Guarantee and this Indenture, including,
without limitation, any right of subrogation, reimbursement, exoneration,
indemnification, and any right to participate in any claim or remedy of any
Holder of Securities against the Company, whether or not such claim, remedy or
right arises in equity, or under contract, statute or common law, including,
without limitation, the right to take or receive from the Company, directly or
indirectly, in cash or other property or by set-off or in any other manner,
payment or security on account of such claim or other rights. If any amount
shall be paid to any Guarantor in violation of the preceding sentence and the
Securities shall not have been paid in full, such amount shall have been deemed
to have been paid to such Guarantor for the benefit of, and held in trust for
the benefit of, the Holders of the Securities, and shall, forthwith be paid to
the Trustee for the benefit of such Holders to be credited and applied upon the
Securities, whether matured or unmatured, in accordance with the terms of this
Indenture. Each Guarantor acknowledges that it will receive direct and
indirect benefits from the financing arrangements contemplated by this
Indenture and that the waiver set forth in this Section 10.06 is knowingly made
in contemplation of such benefits.
SECTION 10.08 Execution of Guarantee.
To evidence their guarantee to the Securityholders set forth
in this Article Ten, the Guarantors hereby agree to execute the Guarantee in
substantially the form included in the Securities, which shall be endorsed on
each Security ordered to be authenticated and delivered by the Trustee. Each
Guarantor hereby agrees that its Guarantee set forth in this Article Ten shall
remain in full force and effect notwithstanding any failure to endorse on each
Security a notation of such Guarantee. Each such Guarantee shall be signed on
behalf of each Guarantor by two Officers, or an Officer and an Assistant
Secretary or one Officer shall sign and one Officer or an Assistant Secretary
(each of whom shall, in each case, have been duly authorized by all requisite
corporate actions) shall attest to such Guarantee prior to the authentication
of the Security on which it is endorsed, and the delivery of such Security by
the Trustee, after the authentication thereof hereunder, shall constitute due
delivery of such Guarantee on behalf of such Guarantor. Such signatures upon
the Guarantee may be by manual or facsimile signature of such officers and may
be imprinted or otherwise reproduced on the Guarantee, and in case any such
officer who shall have signed the Guarantee shall cease to be such officer
before the Security on which such Guarantee is endorsed shall have been
authenticated and delivered by the Trustee or disposed of by the Company, such
100
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Security nevertheless may be authenticated and delivered or disposed of as
though the person who signed the Guarantee had not ceased to be such officer of
the Guarantor.
SECTION 10.09 Waiver of Stay, Extension or Usury Laws.
Each Guarantor convenants (to the extent that it may lawfully
do so) that it will not at any time insist upon, plead, or in any manner
whatsoever claim or take the benefit or advantage of, any stay or extension law
or any usury law or other law that would prohibit or forgive each such
Guarantor from performing its Guarantee as contemplated herein, wherever
enacted, now or at any time hereafter in force, or which may affect the
covenants or the performance of this Indenture; and (to the extent that it may
lawfully do so) each such Guarantor hereby expressly waives all benefit or
advantage of any such law, and covenants that it will not hinder, delay or
impede the execution of any power herein granted to the Trustee, but will
suffer and permit the execution of every such power as though no such law had
been enacted.
ARTICLE XI.
MISCELLANEOUS
SECTION 11.01 TIA Controls.
If any provision of this Indenture limits, qualifies, or
conflicts with the duties imposed by operation of Section 318(c) of the TIA,
the imposed duties shall control.
SECTION 11.02 Notices.
Any notices or other communications required or permitted
hereunder shall be in writing, and shall be sufficiently given if made by hand
delivery, by telex, by telecopier or registered or certified mail, postage
prepaid, return receipt requested, addressed as follows:
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if to the Company:
Walbro Corporation
6242 Garfield Street
Cass City, Michigan 48726
Attention: Chief Executive Officer
Facsimile: (517) 872-2301
Telephone: (517) 872-2131
if to the Trustee:
Bankers Trust Company
Corporate Trust and Agency Group
Four Albany Street
New York, New York 10004
Attention: Corporate Market Services
Facsimile: (212) 250-6392/6961
Telephone: (212) 250-6562
Each of the Company and the Trustee by written notice to each
other such person may designate additional or different addresses for notices
to such person. Any notice or communication to the Company and the Trustee,
shall be deemed to have been given or made as of the date so delivered if
personally delivered; when answered back, if telexed; when receipt is
acknowledged, if telecopied; and five (5) calendar days after mailing if sent
by registered or certified mail, postage prepaid (except that a notice of
change of address shall not be deemed to have been given until actually
received by the addressee).
Any notice or communication mailed to a Securityholder shall
be mailed to him by first class mail or other equivalent means at his address
as it appears on the registration books of the Registrar and shall be
sufficiently given to him if so mailed within the time prescribed.
Failure to mail a notice or communication to a Securityholder
or any defect in it shall not affect its sufficiency with respect to other
Securityholders. If a notice or communication is mailed in the manner provided
above, it is duly given, whether or not the addressee receives it.
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SECTION 11.03 Communications by Holders with Other Holders.
Securityholders may communicate pursuant to TIA Section
312(b) with other Securityholders with respect to their rights under this
Indenture, the Securities or the Guarantees. The Company, the Trustee, the
Registrar and any other person shall have the protection of TIA Section
312(c).
SECTION 11.04 Certificate and Opinion as to Conditions Precedent.
Upon any request or application by the Company to the Trustee
to take any action under this Indenture, the Company shall furnish to the
Trustee at the request of the Trustee:
(1) an Officers' Certificate, in form and substance
satisfactory to the Trustee, stating that, in the opinion of the
signers, all conditions precedent, if any, provided for in this
Indenture relating to the proposed action have been complied with; and
(2) an Opinion of Counsel stating that, in the opinion of
such counsel, all such conditions precedent have been complied with.
SECTION 11.05 Statements Required in Certificate or Opinion.
Each certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture, other than the Officers'
Certificate required by Section 4.08, shall include:
(1) a statement that the person making such certificate
or opinion has read such covenant or condition;
(2) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opinions
contained in such certificate or opinion are based;
(3) a statement that, in the opinion of such person, he
has made such examination or investigation as is necessary to enable
him to express an informed opinion as to whether or not such covenant
or condition has been complied with; and
(4) a statement as to whether or not, in the opinion of
each such person, such condition or covenant has been
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complied with; provided, however, that with respect to matters of fact
an Opinion of Counsel may rely on an Officers' Certificate or
certificates of public officials.
SECTION 11.06 Rules by Trustee, Paying Agent, Registrar.
The Trustee, Paying Agent or Registrar may make reasonable
rules for its functions.
SECTION 11.07 Legal Holidays.
If a payment date is not a Business Day, payment may be made
on the next succeeding day that is a Business Day with the same force and
effect as if made on such payment date.
SECTION 11.08 Governing Law.
THIS INDENTURE, THE SECURITIES AND THE GUARANTEES SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK,
AS APPLIED TO CONTRACTS MADE AND PERFORMED WITHIN THE STATE OF NEW YORK,
WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAW. Each of the parties hereto
agrees to submit to the jurisdiction of the courts of the State of New York in
any action or proceeding arising out of or relating to this Indenture.
SECTION 11.09 No Adverse Interpretation of Other Agreements.
This Indenture may not be used to interpret another indenture,
loan or debt agreement of any of the Company or any of its Subsidiaries. Any
such indenture, loan or debt agreement may not be used to interpret this
Indenture.
SECTION 11.10 No Recourse Against Others.
A director, officer, employee, stockholder or incorporator, as
such, of the Company or any of its Subsidiaries shall not have any liability
for any obligations of the Company or the Guarantors under the Securities, this
Indenture or the Guarantees or for any claim based on, in respect of or by
reason of such obligations or their creations. Each Securityholder by
accepting a Security waives and releases all such liability. Such waiver and
release are part of the consideration for the issuance of the Securities.
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SECTION 11.11 Successors.
All agreements of the Company and the Guarantors in this
Indenture, the Securities and the Guarantees shall bind their respective
successors. All agreements of the Trustee in this Indenture shall bind its
successor.
SECTION 11.12 Duplicate Originals.
All parties may sign any number of copies of this Indenture.
Each signed copy or counterpart shall be an original, but all of them together
shall represent the same agreement.
SECTION 11.13 Severability.
In case any one or more of the provisions in this Indenture,
in the Securities or in the Guarantees shall be held invalid, illegal or
unenforceable, in any respect for any reason, the validity, legality and
enforceability of any such provision in every other respect and of the
remaining provisions shall not in any way be affected or impaired thereby, it
being intended that all of the provisions hereof shall be enforceable to the
full extent permitted by law.
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SIGNATURES
IN WITNESS WHEREOF, the parties hereto have caused this
Indenture to be duly executed, and their respective corporate seals to be
hereunto affixed and attested, all as of the date first written above.
WALBRO CORPORATION
By:
--------------------------
Name:
Title:
BANKERS TRUST COMPANY
as Trustee
By:
--------------------------
Name:
Title:
THE GUARANTORS:
WALBRO AUTOMOTIVE CORPORATION
By:
--------------------------
Name:
Title:
WALBRO ENGINE MANAGEMENT
CORPORATION
By:
--------------------------
Name:
Title:
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SHARON MANUFACTURING COMPANY
By:
--------------------------------
Name:
Title:
WHITEHEAD ENGINEERED PRODUCTS, INC.
By:
--------------------------------
Name:
Title:
107
[FORM OF SERIES A SECURITY]
THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "SECURITIES ACT"), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD
EXCEPT AS SET FORTH BELOW. BY ITS ACQUISITION HEREOF, THE HOLDER (1)
REPRESENTS THAT (A) IT IS A "QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN RULE
144A UNDER THE SECURITIES ACT) OR (B) IT IS AN INSTITUTIONAL "ACCREDITED
INVESTOR" (AS DEFINED IN RULE 501(A)(1), (2), (3) OR (7) UNDER THE SECURITIES
ACT) (AN "ACCREDITED INVESTOR") OR (C) IT IS NOT A U.S. PERSON AND IS ACQUIRING
THIS SECURITY IN AN OFFSHORE TRANSACTION, (2) AGREES THAT IT WILL NOT WITHIN
THREE YEARS AFTER THE ORIGINAL ISSUANCE OF THIS SECURITY RESELL OR OTHERWISE
TRANSFER THIS SECURITY EXCEPT (A) TO THE ISSUER OR ANY SUBSIDIARY THEREOF, (B)
INSIDE THE UNITED STATES TO A QUALIFIED INSTITUTIONAL BUYER IN COMPLIANCE WITH
RULE 144A UNDER THE SECURITIES ACT, (C) INSIDE THE UNITED STATES TO AN
ACCREDITED INVESTOR THAT, PRIOR TO SUCH TRANSFER, FURNISHES TO THE TRUSTEE A
SIGNED LETTER CONTAINING CERTAIN REPRESENTATIONS AND AGREEMENTS (THE FORM OF
WHICH LETTER CAN BE OBTAINED FROM THE TRUSTEE), (D) OUTSIDE THE UNITED STATES
TO PERSONS OTHER THAN U.S. PERSONS IN OFFSHORE TRANSACTIONS MEETING THE
REQUIREMENTS OF RULE 904 UNDER REGULATION S UNDER THE SECURITIES ACT, (E)
PURSUANT TO THE EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144 UNDER THE
SECURITIES ACT (IF AVAILABLE), OR (F) PURSUANT TO AN EFFECTIVE REGISTRATION
STATEMENT UNDER THE SECURITIES ACT AND (3) AGREES THAT IT WILL GIVE TO EACH
PERSON TO WHOM THIS SECURITY IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE
EFFECT OF THIS LEGEND. AS USED HEREIN, THE TERMS "OFFSHORE TRANSACTION,"
"UNITED STATES" AND "U.S. PERSON" HAVE THE RESPECTIVE MEANINGS GIVEN TO THEM
BY REGULATION S UNDER THE SECURITIES ACT.
108
WALBRO CORPORATION
9-7/8% Senior Note
due July 15, 2005, Series A
CUSIP No.:
No. [ ] $[ ]
WALBRO CORPORATION a Delaware corporation (the "Company",
which term includes any successor corporation), for value received promises to
pay to [ ] or registered assigns, the principal sum of $[ ]
Dollars, on July 15, 2005.
Interest Payment Dates: January 15 and July 15 commencing
January 15, 1996
Record Dates: January 1 and July 1
Reference is made to the further provisions of this Security
contained herein, which will for all purposes have the same effect as if set
forth at this place.
IN WITNESS WHEREOF, the Company has caused this Security to be
signed manually or by facsimile by its duly authorized officers.
Dated:
WALBRO CORPORATION
By:
-------------------------------
Name:
Title:
By:
-------------------------------
Name:
Title:
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109
[FORM OF TRUSTEE'S CERTIFICATE OF AUTHENTICATION]
This is one of the 9-7/8% Senior Notes due 2005, Series A,
described in the within-mentioned Indenture.
Dated: BANKERS TRUST COMPANY,
as Trustee
By:
-------------------------------
Authorized Signatory
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110
(REVERSE OF SECURITY)
WALBRO CORPORATION
9-7/8% Senior Note
due July 15, 2005, Series A
1. Interest.
WALBRO CORPORATION, a Delaware corporation (the "Company"),
promises to pay interest on the principal amount of this Security at the rate
per annum shown above. The Company will pay interest semi-annually on January
15 and July 15 of each year (the "Interest Payment Date"), commencing January
15, 1996. Interest on the Securities will accrue from the most recent date to
which interest has been paid or, if no interest has been paid, from July 27,
1995. Interest will be computed on the basis of a 360-day year of twelve
30-day months.
The Company shall pay interest on overdue principal from time
to time on demand at the rate borne by the Securities plus 2% and on overdue
installments of interest (without regard to any applicable grace periods) to
the extent lawful.
2. Method of Payment.
The Company shall pay interest on the Securities (except
defaulted interest) to the persons who are the registered Holders at the close
of business on the Record Date immediately preceding the Interest Payment Date
even if the Securities are cancelled on registration of transfer or
registration of exchange after such Record Date. Holders must surrender
Securities to a Paying Agent to collect principal payments. The Company shall
pay principal and interest in money of the United States that at the time of
payment is legal tender for payment of public and private debts ("U.S. Legal
Tender"). However, the Company may pay principal and interest by wire transfer
of Federal funds, or interest by check payable in such U.S. Legal Tender. The
Company may deliver any such interest payment to the Paying Agent or to a
Holder at the Holder's registered address.
3. Paying Agent and Registrar.
Initially, Bankers Trust Company (the "Trustee") will act as
Paying Agent and Registrar. The Company may change any Paying Agent, Registrar
or co-Registrar without notice to the Holders. The Company or any of its
Subsidiaries may, subject to certain exceptions, act as Registrar or
co-Registrar.
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111
4. Indenture and Guarantees.
The Company issued the Securities under an Indenture, dated as
of July 27, 1995 (the "Indenture"), among the Company, the Guarantors and the
Trustee. Capitalized terms herein are used as defined in the Indenture unless
otherwise defined herein. The terms of the Securities include those stated in
the Indenture and those made part of the Indenture by reference to the Trust
Indenture Act of 1939 (15 U.S.C. Sections 77aaa-77bbbb) (the "TIA"), as
in effect on the date of the Indenture until such time as the Indenture is
qualified under the TIA, and thereafter as in effect on the date on which the
Indenture is qualified under the TIA. Notwithstanding anything to the contrary
herein, the Securities are subject to all such terms, and Holders of Securities
are referred to the Indenture and the TIA for a statement of them. The
Securities are general unsecured obligations of the Company limited in
aggregate principal amount to $110,000,000. Payment on each Security is
guaranteed on a senior basis, jointly and severally, by the Guarantors pursuant
to Article Ten of the Indenture.
5. Optional Redemption.
The Securities will be redeemable, at the Company's option, in
whole at any time or in part from time to time, on and after July 15, 2000 at
the following redemption prices (expressed as percentages of the principal
amount) if redeemed during the twelve-month period commencing on July 15 of the
year set forth below, plus, in each case, accrued interest thereon to the date
of redemption:
Year Percentage
---- ----------
2000 . . . . . . . . . . . . . . . . . . . . . . . 104.938%
2001 . . . . . . . . . . . . . . . . . . . . . . . 103.292%
2002 . . . . . . . . . . . . . . . . . . . . . . . 101.646%
2003 and thereafter . . . . . . . . . . . . . . . 100.000%
6. Optional Redemption upon Public Equity Offering.
At any time, or from time to time, on or prior to July 15,
1998, the Company may, at its option, use the net cash proceeds of one or more
Public Equity Offerings (as defined) to redeem up to an aggregate of 30% of the
principal amount of Securities originally issued, at a redemption price equal
to 110% of the principal amount thereof plus accrued and unpaid interest, if
any, to the date of redemption. In order to effect the foregoing redemption
with the net cash proceeds of a Public Equity Offering, the Company shall send
the redemption notice
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112
not later than 60 days after the consummation of such Public Equity Offering.
As used in the preceding paragraph, "Public Equity Offering"
means an underwritten public offering of Capital Stock (other than Redeemable
Capital Stock) of the Company pursuant to a registration statement filed with
and declared effective by the SEC in accordance with the Securities Act.
7. Notice of Redemption.
Notice of redemption will be mailed at least 30 days but not
more than 60 days before the Redemption Date to each Holder of Securities to be
redeemed at such Holder's registered address. Securities in denominations of
$1,000 may be redeemed only in whole. The Trustee may select for redemption
portions (equal to $1,000 or any integral multiple thereof) of the principal of
Securities that have denominations larger than $1,000.
If any Security is to be redeemed in part only, the notice of
redemption that relates to such Security shall state the portion of the
principal amount thereof to be redeemed. A new Security in a principal amount
equal to the unredeemed portion thereof will be issued in the name of the
Holder thereof upon cancellation of the original Security. On and after the
Redemption Date, interest will cease to accrue on Securities or portions
thereof called for redemption.
8. Change of Control Offer.
Upon the occurrence of a Change of Control, the Company will
be required to offer to purchase all of the outstanding Securities at a
purchase price equal to 101% of the principal amount thereof plus accrued and
unpaid interest, if any, to the date of repurchase.
9. Limitation on Disposition of Assets.
The Company is subject to certain conditions, obligated to
make an offer to purchase Securities at 100% of their principal amount plus
accrued and unpaid interest to the date of repurchase with certain net cash
proceeds of certain sales or other dispositions of assets in accordance with
the Indenture.
10. Denominations; Transfer; Exchange.
The Securities are in registered form, without coupons, in
denominations of $1,000 and integral multiples of $1,000. A Holder shall
register the transfer of or exchange Securities in accordance with the
Indenture. The Registrar may require a
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113
Holder, among other things, to furnish appropriate endorsements and transfer
documents and to pay certain transfer taxes or similar governmental charges
payable in connection therewith as permitted by the Indenture. The Registrar
need not register the transfer of or exchange any Securities or portions
thereof selected for redemption, except the unredeemed portion of any security
being redeemed in part.
11. Persons Deemed Owners.
The registered Holder of a Security shall be treated as the
owner of it for all purposes.
12. Unclaimed Funds.
If funds for the payment of principal or interest remain
unclaimed for two years, the Trustee and the Paying Agents will repay the funds
to the Company at its request. After that, all liability of the Trustee and
such Paying Agents with respect to such funds shall cease.
13. Legal Defeasance and Covenant Defeasance.
The Company may be discharged from its obligations under the
Indenture and the Securities except for certain provisions thereof, and may be
discharged from its obligations to comply with certain covenants contained in
the Indenture and the Securities, in each case upon satisfaction of certain
conditions specified in the Indenture.
14. Amendment; Supplement; Waiver.
Subject to certain exceptions, the Indenture or the Securities
may be amended or supplemented with the written consent of the Holders of at
least a majority in aggregate principal amount of the Securities then
outstanding, and any existing Default or Event of Default or compliance with
any provision may be waived with the consent of the Holders of a majority in
aggregate principal amount of the Securities then outstanding. Without notice
to or consent of any Holder, the parties thereto may amend or supplement the
Indenture or the Securities to, among other things, cure any ambiguity, defect
or inconsistency, provide for uncertificated Securities in addition to or in
place of certificated Securities or comply with any requirements of the SEC in
connection with the qualification of the Indenture under the TIA, or make any
other change that does not materially adversely affect the rights of any Holder
of a Security.
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114
15. Restrictive Covenants.
The Indenture contains certain covenants that, among other
things, limit the ability of the Company and its subsidiaries to make
restricted payments, to incur indebtedness, to create liens, to issue preferred
or other capital stock of subsidiaries, to sell assets, to permit restrictions
on dividends and other payments by subsidiaries to the Company, to consolidate,
merge or sell all or substantially all of its assets, to engage in transactions
with affiliates or to engage in certain businesses. The limitations are
subject to a number of important qualifications and exceptions. The Company
must annually report to the Trustee on compliance with such limitations.
16. Defaults and Remedies.
If an Event of Default occurs and is continuing, the Trustee
or the Holders of at least 25% in aggregate principal amount of Securities then
outstanding may declare all the Securities to be due and payable immediately in
the manner and with the effect provided in the Indenture. Holders of
Securities may not enforce the Indenture or the Securities except as provided
in the Indenture. The Trustee is not obligated to enforce the Indenture or the
Securities unless it has received indemnity satisfactory to it. The Indenture
permits, subject to certain limitations therein provided, Holders of a majority
in aggregate principal amount of the Securities then outstanding to direct the
Trustee in its exercise of any trust or power. The Trustee may withhold from
Holders of Securities notice of any continuing Default or Event of Default
(except a Default in payment of principal or interest, including an accelerated
payment) if it determines that withholding notice is in their interest.
17. Trustee Dealings with Company.
The Trustee under the Indenture, in its individual or any
other capacity, may become the owner or pledgee of Securities and may otherwise
deal with the Company, its Subsidiaries or their respective Affiliates as if it
were not the Trustee.
18. No Recourse Against Others.
No stockholder, director, officer, employee or incorporator,
as such, of the Company shall have any liability for any obligation of the
Company under the Securities or the Indenture or for any claim based on, in
respect of or by reason of, such obligations or their creation. Each Holder of
a Security by accepting a Security waives and releases all such
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115
liability. The waiver and release are part of the consideration for the
issuance of the Securities.
19. Authentication.
This Security shall not be valid until the Trustee or
authenticating agent signs the certificate of authentication on this Security.
20. Abbreviations and Defined Terms.
Customary abbreviations may be used in the name of a Holder of
a Security or an assignee, such as: TEN COM (= tenants in common), TEN ENT
(=tenants by the entireties), JT TEN (= joint tenants with right of survivorship
and not as tenants in common), CUST (= Custodian), and U/G/M/A (= Uniform Gifts
to Minors Act).
21. CUSIP Numbers.
Pursuant to a recommendation promulgated by the Committee on
Uniform Security Identification Procedures, the Company has caused CUSIP
numbers to be printed on the Securities as a convenience to the Holders of the
Securities. No representation is made as to the accuracy of such numbers as
printed on the Securities and reliance may be placed only on the other
identification numbers printed hereon.
22. Registration Rights.
Pursuant to the Registration Rights Agreement, the Company
will be obligated upon the occurrence of certain events to consummate an
exchange offer pursuant to which the Holder of this Security shall have the
right to exchange this Series A Security for the Company's 9-7/8% Senior Notes
due 2005, Series B (the "Series B Securities"), which have been registered
under the Securities Act, in like principal amount and having terms identical
in all material respects as the Series A Securities. The Holders shall be
entitled to receive certain additional interest payments in the event such
exchange offer is not consummated and upon certain other conditions, all
pursuant to and in accordance with the terms of the Registration Rights
Agreement.
The Company will furnish to any Holder of a Security upon
written request and without charge a copy of the Indenture. Requests may be
made to: Walbro Corporation, 6242 Garfield Street, Cass City, Michigan 48726,
Attn: Chief Executive Officer.
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116
GUARANTEE
The Guarantors (as defined in the Indenture referred to in the
Security upon which this notation is endorsed and each hereinafter referred to
as a "Guarantor," which term includes any successor person under the Indenture)
have unconditionally guaranteed on a senior basis (such guarantee by each
Guarantor being referred to herein as the "Guarantee") (i) the due and punctual
payment of the principal of and interest on the Securities, whether at
maturity, by acceleration or otherwise, the due and punctual payment of
interest on the overdue principal and interest, if any, on the Securities, to
the extent lawful, and the due and punctual performance of all other
obligations of the Company to the Holders or the Trustee all in accordance with
the terms set forth in Article Ten of the Indenture and (ii) in case of any
extension of time of payment or renewal of any Securities or any of such other
obligations, that the same will be promptly paid in full when due or performed
in accordance with the terms of the extension or renewal, whether at stated
maturity, by acceleration or otherwise.
No stockholder, officer, director or incorporator, as such,
past, present or future, of any Guarantor shall have any liability under the
Guarantee by reason of his or its status as such stockholder, officer, director
or incorporator.
The Guarantee shall not be valid or obligatory for any purpose
until the certificate of authentication on the Securities upon which the
Guarantee is noted shall have been executed by the Trustee under the Indenture
by the manual signature of one of its authorized officers.
GUARANTORS:
WALBRO AUTOMOTIVE CORPORATION
By:
---------------------------------
Name:
Title:
WALBRO ENGINE MANAGEMENT CORPORATION
By:
---------------------------------
Name:
Title:
117
SHARON MANUFACTURING COMPANY
By:
---------------------------------
Name:
Title:
WHITEHEAD ENGINEERED PRODUCTS, INC.
By:
---------------------------------
Name:
Title:
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118
ASSIGNMENT FORM
I or we assign and transfer this Security to
________________________________________________________________________________
________________________________________________________________________________
(Print or type name, address and zip code of assignee or transferee)
________________________________________________________________________________
(Insert Social Security or other identifying number of assignee or transferee)
and irrevocably appoint ________________________________________________________
agent to transfer this Security on the books of the Company. The agent may
substitute another to act for him.
Dated: Signed:
__________________ _________________
(Sign exactly as
name appears on
the other side of
this Security)
Signature Guarantee:
__________________________________________________________
Participant in a recognized Signature Guarantee Medallion
Program (or other signature guarantor program reasonably
acceptable to the Trustee)
119
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Security purchased by the
Company pursuant to Section 4.15 or Section 4.16 of the Indenture, check the
appropriate box:
Section 4.15 / / Section 4.16 / /
If you want to elect to have only part of this Security
purchased by the Company pursuant to Section 4.15 or Section 4.16 of the
Indenture, state the amount: $_____________
Date:______________________________ Your Signature:_____________________________
(Sign exactly as your name
appears on the other side of
this Security)
Signature Guarantee: ___________________________________________________________
120
EXHIBIT B
[FORM OF SERIES B SECURITY]
WALBRO CORPORATION
9-7/8% Senior Note
due July 15, 2005, Series B
CUSIP No.: [ ]
No. [ ] $[ ]
WALBRO CORPORATION a Delaware corporation (the "Company",
which term includes any successor corporation), for value received promises to
pay to [ ] or registered assigns, the principal sum of $[ ]
Dollars, on July 15, 2005.
Interest Payment Dates: January 15 and July 15 commencing
January 15, 1996
Record Dates: January 1 and July 1
Reference is made to the further provisions of this Security
contained herein, which will for all purposes have the same effect as if set
forth at this place.
IN WITNESS WHEREOF, the Company has caused this Security to be
signed manually or by facsimile by its duly authorized officers.
Dated:
WALBRO CORPORATION
By:
------------------------------------
Name:
Title:
By:
------------------------------------
Name:
Title:
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[FORM OF TRUSTEE'S CERTIFICATE OF AUTHENTICATION]
This is one of the 9-7/8% Senior Notes due 2005, Series B,
described in the within-mentioned Indenture.
Dated: BANKERS TRUST COMPANY,
as Trustee
By
----------------------------------
Authorized Signatory
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(REVERSE OF SECURITY)
WALBRO CORPORATION
9-7/8% Senior Note
due July 15, 2005, Series B
1. Interest.
WALBRO CORPORATION, a Delaware corporation (the "Company"),
promises to pay interest on the principal amount of this Security at the rate
per annum shown above. The Company will pay interest semi-annually on January
15 and July 15 of each year (the "Interest Payment Date"), commencing January
15, 1996. Interest on the Securities will accrue from the most recent date to
which interest has been paid or, if no interest has been paid, from July 27,
1995. Interest will be computed on the basis of a 360- day year of twelve
30-day months.
The Company shall pay interest on overdue principal from time
to time on demand at the rate borne by the Securities plus 2% and on overdue
installments of interest (without regard to any applicable grace periods) to
the extent lawful.
2. Method of Payment.
The Company shall pay interest on the Securities (except
defaulted interest) to the persons who are the registered Holders at the close
of business on the Record Date immediately preceding the Interest Payment Date
even if the Securities are cancelled on registration of transfer or
registration of exchange after such Record Date. Holders must surrender
Securities to a Paying Agent to collect principal payments. The Company shall
pay principal and interest in money of the United States that at the time of
payment is legal tender for payment of public and private debts ("U.S. Legal
Tender"). However, the Company may pay principal and interest by wire transfer
of Federal funds, or interest by check payable in such U.S. Legal Tender. The
Company may deliver any such interest payment to the Paying Agent or to a
Holder at the Holder's registered address.
3. Paying Agent and Registrar.
Initially, Bankers Trust Company (the "Trustee") will act as
Paying Agent and Registrar. The Company may change any Paying Agent, Registrar
or co-Registrar without notice to the Holders. The Company or any of its
Subsidiaries may, subject to certain exceptions, act as Registrar or
co-Registrar.
B-3
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4. Indenture and Guarantees.
The Company issued the Securities under an Indenture, dated as
of July 27, 1995 (the "Indenture"), among the Company, the Guarantors and the
Trustee. Capitalized terms herein are used as defined in the Indenture unless
otherwise defined herein. The terms of the Securities include those stated in
the Indenture and those made part of the Indenture by reference to the Trust
Indenture Act of 1939 (15 U.S.C. Sections 77aaa-77bbbb) (the "TIA"), as in
effect on the date of the Indenture until such time as the Indenture is
qualified under the TIA, and thereafter as in effect on the date on which the
Indenture is qualified under the TIA. Notwithstanding anything to the contrary
herein, the Securities are subject to all such terms, and Holders of Securities
are referred to the Indenture and the TIA for a statement of them. The
Securities are general unsecured obligations of the Company limited in aggregate
principal amount to $110,000,000. Payment on each Security is guaranteed on a
senior basis, jointly and severally, by the Guarantors pursuant to Article Ten
of the Indenture.
5. Optional Redemption.
The Securities will be redeemable, at the Company's option, in
whole at any time or in part from time to time, on and after July 15, 2000 at
the following redemption prices (expressed as percentages of the principal
amount) if redeemed during the twelve-month period commencing on July 15 of the
year set forth below, plus, in each case, accrued interest thereon to the date
of redemption:
Year Percentage
---- ----------
2000 . . . . . . . . . . . . . . . . . . . . . . . 104.938%
2001 . . . . . . . . . . . . . . . . . . . . . . . 103.292%
2002 . . . . . . . . . . . . . . . . . . . . . . . 101.646%
2003 and thereafter . . . . . . . . . . . . . . . 100.000%
6. Optional Redemption upon Public Equity Offering.
At any time, or from time to time, on or prior to July 15,
1998, the Company may, at its option, use the net cash proceeds of one or more
Public Equity Offerings (as defined) to redeem up to an aggregate of 30% of the
principal amount of Securities originally issued, at a redemption price equal
to 110% of the principal amount thereof plus accrued and unpaid interest, if
any, to the date of redemption. In order to effect the foregoing redemption
with the net cash proceeds of a Public Equity Offering, the Company shall send
the redemption notice
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not later than 60 days after the consummation of such Public Equity Offering.
As used in the preceding paragraph, "Public Equity Offering"
means an underwritten public offering of Capital Stock (other than Redeemable
Capital Stock) of the Company pursuant to a registration statement filed with
and declared effective by the SEC in accordance with the Securities Act.
7. Notice of Redemption.
Notice of redemption will be mailed at least 30 days but not
more than 60 days before the Redemption Date to each Holder of Securities to be
redeemed at such Holder's registered address. Securities in denominations of
$1,000 may be redeemed only in whole. The Trustee may select for redemption
portions (equal to $1,000 or any integral multiple thereof) of the principal of
Securities that have denominations larger than $1,000.
If any Security is to be redeemed in part only, the notice of
redemption that relates to such Security shall state the portion of the
principal amount thereof to be redeemed. A new Security in a principal amount
equal to the unredeemed portion thereof will be issued in the name of the
Holder thereof upon cancellation of the original Security. On and after the
Redemption Date, interest will cease to accrue on Securities or portions
thereof called for redemption.
8. Change of Control Offer.
Upon the occurrence of a Change of Control, the Company will
be required to offer to purchase all of the outstanding Securities at a
purchase price equal to 101% of the principal amount thereof plus accrued and
unpaid interest, if any, to the date of repurchase.
9. Limitation on Disposition of Assets.
The Company is subject to certain conditions, obligated to
make an offer to purchase Securities at 100% of their principal amount plus
accrued and unpaid interest to the date of repurchase with certain net cash
proceeds of certain sales or other dispositions of assets in accordance with
the Indenture.
10. Denominations; Transfer; Exchange.
The Securities are in registered form, without coupons, in
denominations of $1,000 and integral multiples of $1,000. A Holder shall
register the transfer of or exchange Securities in accordance with the
Indenture. The Registrar may require a
B-5
125
Holder, among other things, to furnish appropriate endorsements and transfer
documents and to pay certain transfer taxes or similar governmental charges
payable in connection therewith as permitted by the Indenture. The Registrar
need not register the transfer of or exchange any Securities or portions
thereof selected for redemption, except the unredeemed portion of any security
being redeemed in part.
11. Persons Deemed Owners.
The registered Holder of a Security shall be treated as the
owner of it for all purposes.
12. Unclaimed Funds.
If funds for the payment of principal or interest remain
unclaimed for two years, the Trustee and the Paying Agents will repay the funds
to the Company at its request. After that, all liability of the Trustee and
such Paying Agents with respect to such funds shall cease.
13. Legal Defeasance and Covenant Defeasance.
The Company may be discharged from its obligations under the
Indenture and the Securities except for certain provisions thereof, and may be
discharged from its obligations to comply with certain covenants contained in
the Indenture and the Securities, in each case upon satisfaction of certain
conditions specified in the Indenture.
14. Amendment; Supplement; Waiver.
Subject to certain exceptions, the Indenture or the Securities
may be amended or supplemented with the written consent of the Holders of at
least a majority in aggregate principal amount of the Securities then
outstanding, and any existing Default or Event of Default or compliance with
any provision may be waived with the consent of the Holders of a majority in
aggregate principal amount of the Securities then outstanding. Without notice
to or consent of any Holder, the parties thereto may amend or supplement the
Indenture or the Securities to, among other things, cure any ambiguity, defect
or inconsistency, provide for uncertificated Securities in addition to or in
place of certificated Securities or comply with any requirements of the SEC in
connection with the qualification of the Indenture under the TIA, or make any
other change that does not materially adversely affect the rights of any Holder
of a Security.
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126
15. Restrictive Covenants.
The Indenture contains certain covenants that, among other
things, limit the ability of the Company and its subsidiaries to make
restricted payments, to incur indebtedness, to create liens, to issue preferred
or other capital stock of subsidiaries, to sell assets, to permit restrictions
on dividends and other payments by subsidiaries to the Company, to consolidate,
merge or sell all or substantially all of its assets, to engage in transactions
with affiliates or to engage in certain businesses. The limitations are
subject to a number of important qualifications and exceptions. The Company
must annually report to the Trustee on compliance with such limitations.
16. Defaults and Remedies.
If an Event of Default occurs and is continuing, the Trustee
or the Holders of at least 25% in aggregate principal amount of Securities then
outstanding may declare all the Securities to be due and payable immediately in
the manner and with the effect provided in the Indenture. Holders of
Securities may not enforce the Indenture or the Securities except as provided
in the Indenture. The Trustee is not obligated to enforce the Indenture or the
Securities unless it has received indemnity satisfactory to it. The Indenture
permits, subject to certain limitations therein provided, Holders of a majority
in aggregate principal amount of the Securities then outstanding to direct the
Trustee in its exercise of any trust or power. The Trustee may withhold from
Holders of Securities notice of any continuing Default or Event of Default
(except a Default in payment of principal or interest, including an accelerated
payment) if it determines that withholding notice is in their interest.
17. Trustee Dealings with Company.
The Trustee under the Indenture, in its individual or any
other capacity, may become the owner or pledgee of Securities and may otherwise
deal with the Company, its Subsidiaries or their respective Affiliates as if it
were not the Trustee.
18. No Recourse Against Others.
No stockholder, director, officer, employee or incorporator,
as such, of the Company shall have any liability for any obligation of the
Company under the Securities or the Indenture or for any claim based on, in
respect of or by reason of, such obligations or their creation. Each Holder of
a Security by accepting a Security waives and releases all such
B-7
127
liability. The waiver and release are part of the consideration for the
issuance of the Securities.
19. Authentication.
This Security shall not be valid until the Trustee or
authenticating agent signs the certificate of authentication on this Security.
20. Abbreviations and Defined Terms.
Customary abbreviations may be used in the name of a Holder
of a Security or an assignee, such as: TEN COM (= tenants in common), TEN ENT
(=tenants by the entireties), JT TEN (= joint tenants with right of survivor-
ship and not as tenants in common), CUST (= Custodian), and U/G/M/A
(= Uniform Gifts to Minors Act).
21. CUSIP Numbers.
Pursuant to a recommendation promulgated by the Committee on
Uniform Security Identification Procedures, the Company has caused CUSIP
numbers to be printed on the Securities as a convenience to the Holders of the
Securities. No representation is made as to the accuracy of such numbers as
printed on the Securities and reliance may be placed only on the other
identification numbers printed hereon.
The Company will furnish to any Holder of a Security upon
written request and without charge a copy of the Indenture. Requests may be
made to: Walbro Corporation, 6242 Garfield Street, Cass City, Michigan 48726,
Attn: Chief Executive Officer.
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128
GUARANTEE
The Guarantors (as defined in the Indenture referred to in the
Security upon which this notation is endorsed and each hereinafter referred to
as a "Guarantor," which term includes any successor person under the Indenture)
have unconditionally guaranteed on a senior basis (such guarantee by each
Guarantor being referred to herein as the "Guarantee") (i) the due and punctual
payment of the principal of and interest on the Securities, whether at
maturity, by acceleration or otherwise, the due and punctual payment of
interest on the overdue principal and interest, if any, on the Securities, to
the extent lawful, and the due and punctual performance of all other
obligations of the Company to the Holders or the Trustee all in accordance with
the terms set forth in Article Ten of the Indenture and (ii) in case of any
extension of time of payment or renewal of any Securities or any of such other
obligations, that the same will be promptly paid in full when due or performed
in accordance with the terms of the extension or renewal, whether at stated
maturity, by acceleration or otherwise.
No stockholder, officer, director or incorporator, as such,
past, present or future, of any Guarantor shall have any liability under the
Guarantee by reason of his or its status as such stockholder, officer, director
or incorporator.
The Guarantee shall not be valid or obligatory for any purpose
until the certificate of authentication on the Securities upon which the
Guarantee is noted shall have been executed by the Trustee under the Indenture
by the manual signature of one of its authorized officers.
GUARANTORS:
WALBRO AUTOMOTIVE CORPORATION
By:
------------------------------------
Name:
Title:
WALBRO ENGINE MANAGEMENT CORPORATION
By:
------------------------------------
Name:
Title:
129
SHARON MANUFACTURING COMPANY
By:
------------------------------------
Name:
Title:
WHITEHEAD ENGINEERED PRODUCTS, INC.
By:
------------------------------------
Name:
Title:
-2-
130
ASSIGNMENT FORM
I or we assign and transfer this Security to
________________________________________________________________________________
________________________________________________________________________________
(Print or type name, address and zip code of assignee or transferee)
________________________________________________________________________________
(Insert Social Security or other identifying number of assignee or transferee)
and irrevocably appoint ________________________________________________________
agent to transfer this Security on the books of the Company. The agent may
substitute another to act for him.
Dated:_____________________ Signed:_____________________
(Sign exactly as
name appears on
the other side of
this Security)
Signature Guarantee:____________________________________________________________
Participant in a recognized Signature Guarantee Medallion
Program (or other signature guarantor program reasonably
acceptable to the Trustee)
131
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Security purchased by the
Company pursuant to Section 4.15 or Section 4.16 of the Indenture, check the
appropriate box:
Section 4.15 / / Section 4.16 / /
If you want to elect to have only part of this Security
purchased by the Company pursuant to Section 4.15 or Section 4.16 of the
Indenture, state the amount: $_____________
Date:______________________________ Your Signature:____________________________
(Sign exactly as your name
appears on the other side of
this Security)
Signature Guarantee:___________________________________________________________
132
EXHIBIT C
FORM OF LEGEND FOR GLOBAL SECURITIES
Any Global Security authenticated and delivered hereunder
shall bear a legend (which would be in addition to any other legends required
in the case of a Restricted Security) in substantially the following form:
THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE
INDENTURE HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A
DEPOSITORY OR A NOMINEE OF A DEPOSITORY OR A SUCCESSOR DEPOSITORY.
THIS SECURITY IS NOT EXCHANGEABLE FOR SECURITIES REGISTERED IN THE
NAME OF A PERSON OTHER THAN THE DEPOSITORY OR ITS NOMINEE EXCEPT IN
THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE, AND NO TRANSFER
OF THIS SECURITY (OTHER THAN A TRANSFER OF THIS SECURITY AS A WHOLE BY
THE DEPOSITORY TO A NOMINEE OF THE DEPOSITORY OR BY A NOMINEE OF THE
DEPOSITORY TO THE DEPOSITORY OR ANOTHER NOMINEE OF THE DEPOSITORY) MAY
BE REGISTERED EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE
INDENTURE.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION
("DTC"), TO THE ISSUER OR ITS AGENT FOR REGISTRATION OF TRANSFER,
EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE
NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE &
CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR
VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE
REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
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EXHIBIT D
CERTIFICATE TO BE DELIVERED UPON EXCHANGE
OR REGISTRATION OF TRANSFER OF SECURITIES
Re: 9-7/8% Senior Notes due 2005, Series A,
and 9-7/8% Senior Notes due 2005, Series B
(the "Securities"), of Walbro Corporation
This Certificate relates to $_______ principal amount of
Securities held in the form of* ___ a beneficial interest in a Global Security
or* _______ Physical Securities by ______ (the "Transferor").
The Transferor:*
/ / has requested by written order that the Registrar deliver in
exchange for its beneficial interest in the Global Security held by the
Depositary a Physical Security or Physical Securities in definitive, registered
form of authorized denominations and an aggregate number equal to its
beneficial interest in such Global Security (or the portion thereof indicated
above); or
/ / has requested that the Registrar by written order to exchange or
register the transfer of a Physical Security or Physical Securities.
In connection with such request and in respect of each such
Security, the Transferor does hereby certify that the Transferor is familiar
with the Indenture relating to the above captioned Securities and the
restrictions on transfers thereof as provided in Section 2.16 of such
Indenture, and that the transfer of this Securities does not require
registration under the Securities Act of 1933, as amended (the "Act") because*:
/ / Such Security is being acquired for the Transferor's own account,
without transfer (in satisfaction of Section 2.16(a)(II)(A) or Section
2.16(d)(i)(A) of the Indenture).
D-1
134
/ / Such Security is being transferred to a "qualified institutional
buyer" (as defined in Rule 144A under the Act), in reliance on Rule 144A.
/ / Such Security is being transferred to an institutional
"accredited investor" (within the meaning of subparagraphs (a)(1), (2), (3) or
(7) of Rule 501 under the Act.
/ / Such Security is being transferred in reliance on Regulation S
under the Act
/ / Such Security is being transferred in reliance on Rule 144 under
the Act.
/ / Such Security is being transferred in reliance on and in
compliance with an exemption from the registration requirements of the Act other
than Rule 144A or Rule 144 or Regulation S under the Act to a person other than
an institutional "accredited investor."
____________________________________
[INSERT NAME OF TRANSFEROR]
By:__________________________________
[Authorized Signatory]
Date:____________________
*Check applicable box.
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135
EXHIBIT E
Form of Certificate To Be
Delivered in Connection with
Transfers to Institutional Accredited Investors
_______________, ____
Bankers Trust Company
Corporate Trust and Agency Group
Four Albany Street
New York, New York 10004
Re: Walbro Corporation (the "Company")
Indenture (the "Indenture") relating to
9-7/8% Senior Notes due 2005, Series A,
or 9-7/8% Senior Notes due 2005, Series B
Ladies and Gentlemen:
In connection with our proposed purchase of 9-7/8% Senior
Notes due 2005, Series A, or 9-7/8% Series Notes due 2005, Series B (the
"Securities"), of Walbro Corporation (the "Company"), we confirm that:
1. We have received such information as we deem
necessary in order to make our investment decision.
2. We understand that any subsequent transfer of the
Securities is subject to certain restrictions and conditions set forth in the
Indenture and the undersigned agrees to be bound by, and not to resell, pledge
or otherwise transfer the Securities except in compliance with, such
restrictions and conditions and the Securities Act of 1933, as amended (the
"Securities Act").
3. We understand that the offer and sale of the
Securities have not been registered under the Securities Act, and that the
Securities may not be offered or sold within the United States or to, or for
the account or benefit of, U.S. persons except as permitted in the following
sentence. We agree, on our own behalf and on behalf of any accounts for which
we are acting as hereinafter stated, that if we should sell any Securities, we
will do so only (A) to the Company or any subsidiary thereof, (B) inside the
United States in accordance with Rule 144A under the Securities Act to a
"qualified institutional buyer" (as defined therein), (C) inside the United
States to an institutional "accredited investor" (as defined below) that,
prior to such transfer, furnishes (or has furnished on its behalf by a U.S.
E-1
136
broker-dealer) to the Trustee a signed letter substantially in the form hereof,
(D) outside the United States in accordance with Regulations S under the
Securities Act, (E) pursuant to the exemption from registration provided by
Rule 144 under the Securities Act (if available), or (F) pursuant to an
effective registration statement under the Securities Act, and we further agree
to provide to any person purchasing Securities from us a notice advising such
purchaser that resales of the Securities are restricted as stated herein.
4. We understand that, on any proposed resale of
Securities, we will be required to furnish to the Trustee and the Company, such
certification, legal opinions and other information as the Trustee and the
Company may reasonably require to confirm that the proposed sale complies with
the foregoing restrictions. We further understand that the Securities
purchased by us will bear a legend to the foregoing effect.
5. We are an institutional "accredited investor" (as
defined in Rule 501(a)(1), (2), (3) or (7) of Regulation D under the Securities
Act) and have such knowledge and experience in financial and business matters
as to be capable of evaluating the merits and risks of our investment in the
Securities, and we and any accounts for which we are acting are each able to
bear the economic risk of our or their investment, as the case may be.
6. We are acquiring the Securities purchased by us for
our account or for one or more accounts (each of which is an institutional
"accredited investor") as to each of which we exercise sole investment
discretion.
You and the Company are entitled to rely upon this letter and
are irrevocably authorized to produce this letter or a copy hereof to any
interested party in any administrative or legal proceeding or official inquiry
with respect to the matters covered hereby.
Very truly yours,
[Name of Transferor]
By:
---------------------------------
[Authorized Signatory]
E-2
137
EXHIBIT F
Form of Certificate To Be
Delivered in Connection
with Regulation S Transfers
_______________, ____
Bankers Trust Company
Corporate Trust and Agency Group
Four Albany Street
New York, New York 10004
Re: Walbro Corporation (the "Company") 9-7/8%
Senior Notes due 2005, Series A, and 9-7/8%
Senior Notes due 2005, Series B (the "Securities")
Dear Sirs:
In connection with our proposed sale of $____________
aggregate principal amount of the Securities, we confirm that such sale has
been effected pursuant to and in accordance with Regulation S under the
Securities Act of 1933, as amended (the "Securities Act"), and, accordingly, we
represent that:
(1) the offer of the Securities was not made to a person in the
United States;
(2) either (a) at the time the buy offer was originated, the
transferee was outside the United States or we and any person acting on our
behalf reasonably believed that the transferee was outside the United States,
or (b) the transaction was executed in, on or through the facilities of a
designated off-shore securities market and neither we nor any person acting on
our behalf knows that the transaction has been pre-arranged with a buyer in the
United States;
(3) no directed selling efforts have been made in the United
States in contravention of the requirements of Rule 903(b) or Rule 904(b) of
Regulation S, as applicable;
(4) the transaction is not part of a plan or scheme to evade the
registration requirements of the Securities Act; and
(5) we have advised the transferee of the transfer restrictions
applicable to the Securities.
F-1
138
You and the Company are entitled to rely upon this letter and
are irrevocably authorized to produce this letter or a copy hereof to any
interested party in any administrative or legal proceedings or official inquiry
with respect to the matters covered hereby. Defined terms used herein without
definition have the respective meanings provided in Regulation S.
Very truly yours,
[Name of Transferor]
By:
---------------------------------
[Authorized Signatory]
F-2
EX-2.4
4
EXHIBIT 2.4
1
EXHIBIT 2.4
EXECUTION COPY
================================================================================
WALBRO CORPORATION
$135,000,000 CREDIT AGREEMENT
DATED AS OF JULY 26, 1995
COMERICA BANK, AS AGENT
================================================================================
2
TABLE OF CONTENTS
Page
----
1. DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
1.1 "Account(s)" . . . . . . . . . . . . . . . . . . . . . . . . . . 1
1.2 "Account Debtor" . . . . . . . . . . . . . . . . . . . . . . . . 1
1.3 "Account Party(ies)" . . . . . . . . . . . . . . . . . . . . . . 1
1.4 "Activation Fee" . . . . . . . . . . . . . . . . . . . . . . . . 1
1.5 "Advance(s)" . . . . . . . . . . . . . . . . . . . . . . . . . . 1
1.6 "Affiliate" . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
1.7 "Agent" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
1.8 "Agent's Correspondent" . . . . . . . . . . . . . . . . . . . . . 2
1.9 "Agent's Fees" . . . . . . . . . . . . . . . . . . . . . . . . . 2
1.10 "Alternate Base Rate" . . . . . . . . . . . . . . . . . . . . . . 2
1.11 "Alternative Currency" . . . . . . . . . . . . . . . . . . . . . 2
1.12 "Alternative Currency Principal Limit" . . . . . . . . . . . . . 3
1.13 "Applicable Fee Percentage" . . . . . . . . . . . . . . . . . . . 3
1.14 "Applicable Interest Rate" . . . . . . . . . . . . . . . . . . . 3
1.15 "Applicable Margin" . . . . . . . . . . . . . . . . . . . . . . . 3
1.16 "Assignment Agreement" . . . . . . . . . . . . . . . . . . . . . 3
1.17 "Banks" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
1.18 "Business Day" . . . . . . . . . . . . . . . . . . . . . . . . . 3
1.19 "Capital Expenditures" . . . . . . . . . . . . . . . . . . . . . 3
1.20 "Capitalized Lease Obligations" . . . . . . . . . . . . . . . . . 4
1.21 "Closing Fee" . . . . . . . . . . . . . . . . . . . . . . . . . . 4
1.22 "Co-Agent" . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
1.23 "Collateral" . . . . . . . . . . . . . . . . . . . . . . . . . . 4
1.24 "Collateral Agent" . . . . . . . . . . . . . . . . . . . . . . . 4
1.25 "Collateral Documents" . . . . . . . . . . . . . . . . . . . . . 4
1.26 "Company" . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
1.27 "Company Collateral Documents" . . . . . . . . . . . . . . . . . 4
1.28 "Company Guaranty" . . . . . . . . . . . . . . . . . . . . . . . 4
1.29 "Company Security Agreement" . . . . . . . . . . . . . . . . . . 5
1.30 "Consolidated" or "Consolidating" . . . . . . . . . . . . . . . . 5
1.31 "Consolidated Intangible Assets" . . . . . . . . . . . . . . . . 5
1.32 "Consolidated Net Income" . . . . . . . . . . . . . . . . . . . . 5
1.33 "Consolidated Tangible Net Worth" . . . . . . . . . . . . . . . . 5
1.34 "Continuing Directors" . . . . . . . . . . . . . . . . . . . . . 6
1.35 "Contractual Obligation" . . . . . . . . . . . . . . . . . . . . 6
1.36 "Covenant Compliance Report" . . . . . . . . . . . . . . . . . . 6
1.37 "Current Dollar Equivalent" . . . . . . . . . . . . . . . . . . . 6
1.38 "Current Shareholder and Management Group" . . . . . . . . . . . 6
1.39 "De Minimis Matters" . . . . . . . . . . . . . . . . . . . . . . 6
1.40 "Debt" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
1.41 "Default" . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
1.42 "Dollar Amount" . . . . . . . . . . . . . . . . . . . . . . . . . 7
1.43 "Dollars" and the sign "$" . . . . . . . . . . . . . . . . . . . 7
1.44 "Domestic Advance" . . . . . . . . . . . . . . . . . . . . . . . 8
1.45 "Domestic Guaranty" . . . . . . . . . . . . . . . . . . . . . . . 8
1.46 "Domestic Subsidiaries" . . . . . . . . . . . . . . . . . . . . . 8
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1.47 "Dyno" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
1.48 "Dyno Acquisition Agreement" . . . . . . . . . . . . . . . . . . 8
1.49 "Dyno Acquisition" . . . . . . . . . . . . . . . . . . . . . . . 8
1.50 "Dyno Capital Expenditures" . . . . . . . . . . . . . . . . . . . 8
1.51 "EBITDA" . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
1.52 "Equity Offering" . . . . . . . . . . . . . . . . . . . . . . . . 8
1.53 "Equity Offering Adjustment" . . . . . . . . . . . . . . . . . . 9
1.54 "ERISA" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
1.55 "ERISA Affiliate" . . . . . . . . . . . . . . . . . . . . . . . . 9
1.56 "Eurocurrency-based Advance" . . . . . . . . . . . . . . . . . . 9
1.57 "Eurocurrency-based Rate" . . . . . . . . . . . . . . . . . . . . 9
1.58 "Eurocurrency-Interest Period" . . . . . . . . . . . . . . . . . 10
1.59 "Eurocurrency Lending Office" . . . . . . . . . . . . . . . . . . 10
1.60 "Event of Default" . . . . . . . . . . . . . . . . . . . . . . . 10
1.61 "Excess Cash Flow" . . . . . . . . . . . . . . . . . . . . . . . 10
1.62 "Existing Senior Debt" . . . . . . . . . . . . . . . . . . . . . 10
1.63 "Existing Senior Debt Documents" . . . . . . . . . . . . . . . . 10
1.64 "Existing Senior Note Purchasers" . . . . . . . . . . . . . . . . 11
1.65 "Existing Senior Notes" . . . . . . . . . . . . . . . . . . . . . 11
1.66 "Federal Funds Effective Rate" . . . . . . . . . . . . . . . . . 11
1.67 "Fees" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
1.68 "Fixed Charge Coverage Ratio" . . . . . . . . . . . . . . . . . . 11
1.69 "Fixed Rate" . . . . . . . . . . . . . . . . . . . . . . . . . . 11
1.70 "Fixed Rate Advance" . . . . . . . . . . . . . . . . . . . . . . 12
1.71 "Fixed Rate Option" . . . . . . . . . . . . . . . . . . . . . . . 12
1.72 "Fixed Rate Election" . . . . . . . . . . . . . . . . . . . . . . 12
1.73 "Foreign Subsidiaries" . . . . . . . . . . . . . . . . . . . . . 12
1.74 "Funded Debt" . . . . . . . . . . . . . . . . . . . . . . . . . . 12
1.75 "Funded Debt Ratio" . . . . . . . . . . . . . . . . . . . . . . . 12
1.76 "GAAP" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
1.77 "Guaranties" . . . . . . . . . . . . . . . . . . . . . . . . . . 13
1.78 "Guarantor Collateral Documents" . . . . . . . . . . . . . . . . 13
1.79 "Guarantor Security Agreement[s]" . . . . . . . . . . . . . . . . 13
1.80 "Guarantor(s)" . . . . . . . . . . . . . . . . . . . . . . . . . 13
1.81 "Hazardous Material" . . . . . . . . . . . . . . . . . . . . . . 13
1.82 "Hazardous Material Law(s)" . . . . . . . . . . . . . . . . . . . 13
1.83 "Hereof", "hereto", "hereunder" . . . . . . . . . . . . . . . . . 14
1.84 "HLT Determination" . . . . . . . . . . . . . . . . . . . . . . . 14
1.85 "Indebtedness" . . . . . . . . . . . . . . . . . . . . . . . . . 14
1.86 "Intercreditor Agreement" . . . . . . . . . . . . . . . . . . . . 15
1.87 "Intercompany Loan" . . . . . . . . . . . . . . . . . . . . . . . 15
1.88 "Intercompany Loans, Advances or
Investments" . . . . . . . . . . . . . . . . . . . . . . . . . 15
1.89 "Interest Period" . . . . . . . . . . . . . . . . . . . . . . . . 15
1.90 "Internal Revenue Code" . . . . . . . . . . . . . . . . . . . . . 15
1.91 "Investment" . . . . . . . . . . . . . . . . . . . . . . . . . . 15
1.92 "Issuing Office" . . . . . . . . . . . . . . . . . . . . . . . . 16
1.93 "Japanese Term Loan" . . . . . . . . . . . . . . . . . . . . . . 16
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1.94 "Joinder Agreement" . . . . . . . . . . . . . . . . . . . . . . . 16
1.95 "Joint Venture" . . . . . . . . . . . . . . . . . . . . . . . . . 16
1.96 "Lender Debt" . . . . . . . . . . . . . . . . . . . . . . . . . . 16
1.97 "Lenders" . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
1.98 "Letter of Credit Agreement" . . . . . . . . . . . . . . . . . . 16
1.99 "Letter of Credit Fees" . . . . . . . . . . . . . . . . . . . . . 16
1.100 "Letter of Credit Maximum Amount" . . . . . . . . . . . . . . . . 16
1.101 "Letter of Credit Obligation(s)" . . . . . . . . . . . . . . . . 17
1.102 "Letter of Credit Payment" . . . . . . . . . . . . . . . . . . . 17
1.103 "Letter(s) of Credit" . . . . . . . . . . . . . . . . . . . . . . 17
1.104 "Lien" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
1.105 "Loan Documents" . . . . . . . . . . . . . . . . . . . . . . . . 17
1.106 "Majority Banks" . . . . . . . . . . . . . . . . . . . . . . . . 17
1.107 "Material Property" . . . . . . . . . . . . . . . . . . . . . . . 17
1.108 "Minority Interests" . . . . . . . . . . . . . . . . . . . . . . 17
1.109 "Multiemployer Plan" . . . . . . . . . . . . . . . . . . . . . . 18
1.110 "Net Income Adjustment" . . . . . . . . . . . . . . . . . . . . . 18
1.111 "New Senior Debt" . . . . . . . . . . . . . . . . . . . . . . . . 18
1.112 "New Senior Debt Documents" . . . . . . . . . . . . . . . . . . . 18
1.113 "New Senior Note Purchasers" . . . . . . . . . . . . . . . . . . 18
1.114 "New Senior Notes" . . . . . . . . . . . . . . . . . . . . . . . 18
1.115 "Notes" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
1.116 "PBGC" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
1.117 "Pension Plan(s)" . . . . . . . . . . . . . . . . . . . . . . . . 18
1.118 "Percentage" . . . . . . . . . . . . . . . . . . . . . . . . . . 19
1.119 "Permitted Acquisitions" . . . . . . . . . . . . . . . . . . . . 19
1.120 "Permitted Borrower" . . . . . . . . . . . . . . . . . . . . . . 20
1.121 "Permitted Borrower Guaranty" . . . . . . . . . . . . . . . . . . 20
1.122 "Permitted Currency(ies)" . . . . . . . . . . . . . . . . . . . . 20
1.123 "Permitted Guaranties" . . . . . . . . . . . . . . . . . . . . . 20
1.124 "Permitted Investments" . . . . . . . . . . . . . . . . . . . . . 20
1.125 "Permitted Liens" . . . . . . . . . . . . . . . . . . . . . . . . 21
1.126 "Permitted Merger(s)" . . . . . . . . . . . . . . . . . . . . . . 23
1.127 "Permitted Transfer(s)" . . . . . . . . . . . . . . . . . . . . . 24
1.128 "Person" . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
1.129 "Prime Rate" . . . . . . . . . . . . . . . . . . . . . . . . . . 24
1.130 "Prime-based Advance" . . . . . . . . . . . . . . . . . . . . . . 24
1.131 "Prime-based Rate" . . . . . . . . . . . . . . . . . . . . . . . 24
1.132 "Prohibited Transaction" . . . . . . . . . . . . . . . . . . . . 25
1.133 "Quoted Rate" . . . . . . . . . . . . . . . . . . . . . . . . . . 25
1.134 "Quoted Rate Advance" . . . . . . . . . . . . . . . . . . . . . . 25
1.135 "Quoted Rate Interest Period" . . . . . . . . . . . . . . . . . . 25
1.136 "Reference Banks" . . . . . . . . . . . . . . . . . . . . . . . . 25
1.137 "Refunded Swing Line Advance" . . . . . . . . . . . . . . . . . . 25
1.138 "Reportable Event" . . . . . . . . . . . . . . . . . . . . . . . 25
1.139 "Request for Advance" . . . . . . . . . . . . . . . . . . . . . . 25
1.140 "Required Consummation Date" . . . . . . . . . . . . . . . . . . 25
1.141 "Revolving Credit" . . . . . . . . . . . . . . . . . . . . . . . 25
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1.142 "Revolving Credit Aggregate Commitment" . . . . . . . . . . . . . 25
1.143 "Revolving Credit Commitment Fee" . . . . . . . . . . . . . . . . 26
1.144 "Revolving Credit Designated Unused
Portion" . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
1.145 "Revolving Credit Maturity Date" . . . . . . . . . . . . . . . . 26
1.146 "Revolving Credit Maximum Amount" . . . . . . . . . . . . . . . . 26
1.147 "Revolving Credit Notes" . . . . . . . . . . . . . . . . . . . . 26
1.148 "Shares" . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
1.149 "Sharon" . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
1.150 "Special Conditions" . . . . . . . . . . . . . . . . . . . . . . 26
1.151 "Special Purpose Letter(s) of Credit" . . . . . . . . . . . . . . 28
1.152 "Significant Subsidiary(ies)" . . . . . . . . . . . . . . . . . . 28
1.153 "Significant Domestic Subsidiaries" . . . . . . . . . . . . . . . 28
1.154 "Significant Foreign Subsidiaries" . . . . . . . . . . . . . . . 28
1.155 "Single Employer Plan" . . . . . . . . . . . . . . . . . . . . . 28
1.156 "Sublimit" . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
1.157 "Subordinated Debt" . . . . . . . . . . . . . . . . . . . . . . . 29
1.158 "Subsidiary(ies)" . . . . . . . . . . . . . . . . . . . . . . . . 29
1.159 "Swing Line Advance" . . . . . . . . . . . . . . . . . . . . . . 29
1.160 "Swing Line Bank" . . . . . . . . . . . . . . . . . . . . . . . . 29
1.161 "Swing Line Maximum Amount" . . . . . . . . . . . . . . . . . . . 29
1.162 "Swing Line Note(s)" . . . . . . . . . . . . . . . . . . . . . . 29
1.163 "Term Loans" . . . . . . . . . . . . . . . . . . . . . . . . . . 29
1.164 "Term Loan Aggregate Commitment" . . . . . . . . . . . . . . . . 29
1.165 "Term Loan Funding Period" . . . . . . . . . . . . . . . . . . . 30
1.166 "Term Loan Maturity Date" . . . . . . . . . . . . . . . . . . . . 30
1.167 "Term Loan Permitted Amortization
Schedule" . . . . . . . . . . . . . . . . . . . . . . . . . . 30
1.168 "Term Loan Initial Request" . . . . . . . . . . . . . . . . . . . 30
1.169 "Term Loan Rate Request" . . . . . . . . . . . . . . . . . . . . 30
1.170 "Term Loan Request" . . . . . . . . . . . . . . . . . . . . . . . 31
1.171 "Term Notes" . . . . . . . . . . . . . . . . . . . . . . . . . . 31
1.172 "UCC" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
1.173 "Walbro Automotive" . . . . . . . . . . . . . . . . . . . . . . . 31
1.174 "Walbro Engine Management" . . . . . . . . . . . . . . . . . . . 31
1.175 "Walbro Belgium" . . . . . . . . . . . . . . . . . . . . . . . . 31
1.176 "Walbro England" . . . . . . . . . . . . . . . . . . . . . . . . 31
1.177 "Walbro France" . . . . . . . . . . . . . . . . . . . . . . . . . 31
1.178 "Walbro Germany" . . . . . . . . . . . . . . . . . . . . . . . . 31
1.179 "Walbro Japan" . . . . . . . . . . . . . . . . . . . . . . . . . 31
1.180 "Walbro Netherlands" . . . . . . . . . . . . . . . . . . . . . . 31
1.181 "Walbro Spain" . . . . . . . . . . . . . . . . . . . . . . . . . 31
1.182 "Whitehead" . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
1.183 "Yield Maintenance Payment" . . . . . . . . . . . . . . . . . . . 31
2. REVOLVING CREDIT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
2.1 Commitment. . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
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2.2 Accrual of Interest and Maturity. . . . . . . . . . . . . . . . . 32
2.3 Requests for and Refundings and
Conversions of Advances. . . . . . . . . . . . . . . . . . . . . 33
2.4 Disbursement of Advances. . . . . . . . . . . . . . . . . . . . . 36
2.5 (a) Swing Line Advances. . . . . . . . . . . . . . . . . . . 37
(b) Accrual of Interest. . . . . . . . . . . . . . . . . . . 38
(c) Requests for Swing Line Advances. . . . . . . . . . . . . 38
(d) Disbursement of Swing Line
Advances. . . . . . . . . . . . . . . . . . . . . . . . 40
(e) Refunding of or Participation
Interest in Swing Line Advances. . . . . . . . . . . . 41
2.6 Prime-based Interest Payments. . . . . . . . . . . . . . . . . . . 43
2.7 Eurocurrency-based and Quoted Rate
Interest Payments. . . . . . . . . . . . . . . . . . . . . . . . 43
2.8 Interest Payments on Conversions. . . . . . . . . . . . . . . . . 44
2.9 Interest on Default. . . . . . . . . . . . . . . . . . . . . . . . 44
2.10 Prepayment. . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
2.11 Determination, Denomination and
Redenomination of Alternative Currency
Advances. . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
2.12 Prime-based Advance in Absence of Election
or Upon Default. . . . . . . . . . . . . . . . . . . . . . . . . 46
2.13 Revolving Credit Commitment Fee. . . . . . . . . . . . . . . . . . 46
2.14 Currency Appreciation; Sublimits;
Mandatory Reduction of Indebtedness. . . . . . . . . . . . . . . 47
2.15 Optional Reduction or Termination of
Revolving Credit Maximum Amount. . . . . . . . . . . . . . . . . 49
2.16 Revolving Credit Designated Unused
Portion. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
2.17 Activation of Designated Unused Portion. . . . . . . . . . . . . . 50
2.18 Extension of Revolving Credit Maturity
Date. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
2.19 Application of Advances. . . . . . . . . . . . . . . . . . . . . . 51
3. LETTERS OF CREDIT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
3.1 Letters of Credit. . . . . . . . . . . . . . . . . . . . . . . . . 52
3.2A Conditions to Issuance. . . . . . . . . . . . . . . . . . . . . . 52
3.2B Special Purpose Letters of Credit. . . . . . . . . . . . . . . . . 55
3.3 Notice. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
3.4 Letter of Credit Fees. . . . . . . . . . . . . . . . . . . . . . . 55
3.5 Issuance Fees. . . . . . . . . . . . . . . . . . . . . . . . . . . 56
3.6 Draws and Demands for Payment Under
Letters of Credit. . . . . . . . . . . . . . . . . . . . . . . . 56
3.7 Obligations Irrevocable. . . . . . . . . . . . . . . . . . . . . . 58
3.8 Risk Under Letters of Credit. . . . . . . . . . . . . . . . . . . 59
3.9 Indemnification. . . . . . . . . . . . . . . . . . . . . . . . . . 60
3.10 Right of Reimbursement. . . . . . . . . . . . . . . . . . . . . . 61
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4. TERM LOANS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
4.1 Commitment. . . . . . . . . . . . . . . . . . . . . . . . . . . 61
4.2 Repayment of Principal. . . . . . . . . . . . . . . . . . . . . 62
4.3 Excess Cash Flow Recapture. . . . . . . . . . . . . . . . . . . 62
4.4 Accrual of Interest. . . . . . . . . . . . . . . . . . . . . . 63
4.5 Prime-based Interest Payments. . . . . . . . . . . . . . . . . 63
4.6 Eurocurrency-based Interest Payments. . . . . . . . . . . . . . 63
4.7 Interest Payments on Conversions. . . . . . . . . . . . . . . . 64
4.8 Interest on Default. . . . . . . . . . . . . . . . . . . . . . 64
4.9A Initial Requests for Funding Term Loans . . . . . . . . . . . . 65
4.9B Term Loan Rate Requests; Refundings and
Conversions of Advances. . . . . . . . . . . . . . . . . . . 67
4.9C Term Loan Certifications. . . . . . . . . . . . . . . . . . . . 69
4.9D Failure to Refund or Convert . . . . . . . . . . . . . . . . . 69
4.9E Limited Availability . . . . . . . . . . . . . . . . . . . . . 70
4.9F Unavailability . . . . . . . . . . . . . . . . . . . . . . . . 70
4.9G Reconversion to Applicable Alternative
Currency and Eurocurrency-based Rate on
Re-availability . . . . . . . . . . . . . . . . . . . . . . . 70
4.9H Repayment on Reconversion . . . . . . . . . . . . . . . . . . . 71
4.9I Interest Payments on Conversions and
Reconversions . . . . . . . . . . . . . . . . . . . . . . . . 71
4.10 Disbursement of Advances. . . . . . . . . . . . . . . . . . . . 71
4.11 Fixed Rate Election. . . . . . . . . . . . . . . . . . . . . . 73
4.12 Prepayment. . . . . . . . . . . . . . . . . . . . . . . . . . . 75
4.13 Purpose. . . . . . . . . . . . . . . . . . . . . . . . . . . . 76
5. MARGIN ADJUSTMENTS; HLT DETERMINATION; SPECIAL LIMITATION . . . . . . . . 76
5.1 Margin Adjustments. . . . . . . . . . . . . . . . . . . . . . . 76
5.2 HLT Determination. . . . . . . . . . . . . . . . . . . . . . . 77
5.3 Special Limitation. . . . . . . . . . . . . . . . . . . . . . . 78
6. CONDITIONS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 78
6.1 Execution of Notes, this Agreement and the
other Loan Documents. . . . . . . . . . . . . . . . . . . . . 78
6.2 Corporate Authority. . . . . . . . . . . . . . . . . . . . . . 79
6.3 Company Guaranty. . . . . . . . . . . . . . . . . . . . . . . . 79
6.4 Domestic Guaranty. . . . . . . . . . . . . . . . . . . . . . . 79
6.5 Foreign Permitted Borrower Guaranty. . . . . . . . . . . . . . 79
6.6 Company Collateral Documents. . . . . . . . . . . . . . . . . . 79
6.7 Guarantor Collateral Documents. . . . . . . . . . . . . . . . . 80
6.8 Representations and Warranties -- All
Parties. . . . . . . . . . . . . . . . . . . . . . . . . . . 80
6.9 Compliance with Certain Documents and
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Agreements. . . . . . . . . . . . . . . . . . . . . . . . . . 80
6.10 Opinion of Counsel. . . . . . . . . . . . . . . . . . . . . . . 81
6.11 Intercreditor Agreement and Existing
Senior Debt. . . . . . . . . . . . . . . . . . . . . . . . . 81
6.12 Company's Certificate. . . . . . . . . . . . . . . . . . . . . 81
6.13 Payment of Agent's and Other Fees. . . . . . . . . . . . . . . 81
6.14 Other Documents and Instruments. . . . . . . . . . . . . . . . 81
6.15 Continuing Conditions. . . . . . . . . . . . . . . . . . . . . 81
7. REPRESENTATIONS AND WARRANTIES. . . . . . . . . . . . . . . . . . . . . . 82
7.1 Corporate Authority. . . . . . . . . . . . . . . . . . . . . . 82
7.2 Due Authorization -- Company. . . . . . . . . . . . . . . . . . 83
7.3 Due Authorization -- Subsidiaries. . . . . . . . . . . . . . . 83
7.4 Title to Property. . . . . . . . . . . . . . . . . . . . . . . 83
7.5 Liens. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 83
7.6 Subsidiaries. . . . . . . . . . . . . . . . . . . . . . . . . . 83
7.7 Taxes. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 83
7.8 No Defaults. . . . . . . . . . . . . . . . . . . . . . . . . . 84
7.9 Enforceability of Agreement and Loan
Documents -- Company. . . . . . . . . . . . . . . . . . . . . 84
7.10 Enforceability of Loan Documents --
Significant Subsidiaries. . . . . . . . . . . . . . . . . . . 84
7.11 Non-contravention -- Company. . . . . . . . . . . . . . . . . . 84
7.12 Non-contravention -- Subsidiaries. . . . . . . . . . . . . . . 85
7.13 No Litigation -- Company. . . . . . . . . . . . . . . . . . . . 85
7.14 No Litigation -- Other Parties. . . . . . . . . . . . . . . . . 85
7.15 Consents, Approvals and Filings, Etc. . . . . . . . . . . . . . 86
7.16 Agreements Affecting Financial Condition. . . . . . . . . . . . 86
7.17 No Investment Company; No Margin Stock. . . . . . . . . . . . . 86
7.18 ERISA. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 87
7.19 Environmental Matters and Safety Matters. . . . . . . . . . . . 88
7.20 Accuracy of Information. . . . . . . . . . . . . . . . . . . . 89
8. AFFIRMATIVE COVENANTS . . . . . . . . . . . . . . . . . . . . . . . . . . 90
8.1 Preservation of Existence, Etc. . . . . . . . . . . . . . . . . 90
8.2 Keeping of Books. . . . . . . . . . . . . . . . . . . . . . . . 90
8.3 Reporting Requirements. . . . . . . . . . . . . . . . . . . . . 90
8.4 Consolidated Tangible Net Worth. . . . . . . . . . . . . . . . 92
8.5 Funded Debt Ratio. . . . . . . . . . . . . . . . . . . . . . . 92
8.6 Maintain Fixed Charge Coverage Ratio. . . . . . . . . . . . . . 92
8.7 Inspections. . . . . . . . . . . . . . . . . . . . . . . . . . 93
8.8 Taxes. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 93
8.9 Further Assurances; Financing Statements. . . . . . . . . . . . 93
8.10 Insurance. . . . . . . . . . . . . . . . . . . . . . . . . . . 94
8.11 Indemnification. . . . . . . . . . . . . . . . . . . . . . . . 94
8.12 Governmental and Other Approvals. . . . . . . . . . . . . . . . 95
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8.13 Compliance with Contractual Obligations
and Laws. . . . . . . . . . . . . . . . . . . . . . . . . . . 95
8.14 ERISA. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 95
8.15 Environmental Matters. . . . . . . . . . . . . . . . . . . . . 96
8.16 Power of Attorney. . . . . . . . . . . . . . . . . . . . . . . 98
8.17 Significant Subsidiaries; Joinder
Agreements. . . . . . . . . . . . . . . . . . . . . . . . . . 99
8.18 Financial Covenant Amendments. . . . . . . . . . . . . . . . . 99
9. NEGATIVE COVENANTS . . . . . . . . . . . . . . . . . . . . . . . . . . . 100
9.1 Capital Structure and Redemptions. . . . . . . . . . . . . . . 100
9.2 Business Purposes. . . . . . . . . . . . . . . . . . . . . . . 100
9.3 Mergers or Dispositions. . . . . . . . . . . . . . . . . . . . 100
9.4 Guaranties. . . . . . . . . . . . . . . . . . . . . . . . . . . 101
9.5 Debt. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 101
9.6 Liens. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 101
9.7 Acquisitions. . . . . . . . . . . . . . . . . . . . . . . . . . 102
9.8 Investments. . . . . . . . . . . . . . . . . . . . . . . . . . 102
9.9 Accounts Receivable. . . . . . . . . . . . . . . . . . . . . . 104
9.10 Transactions with Affiliates. . . . . . . . . . . . . . . . . . 104
9.11 Dyno Capital Expenditures. . . . . . . . . . . . . . . . . . . 104
9.12 No Further Negative Pledges. . . . . . . . . . . . . . . . . . 104
9.13 Prepayment of Debts. . . . . . . . . . . . . . . . . . . . . . 105
9.14 Amendment of Existing Senior Debt
Documents and New Senior Debt Documents
and Subordinated Debt. . . . . . . . . . . . . . . . . . . . 105
10. DEFAULTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 105
10.1 Events of Default. . . . . . . . . . . . . . . . . . . . . . . 105
10.2 Exercise of Remedies. . . . . . . . . . . . . . . . . . . . . . 108
10.3 Rights Cumulative. . . . . . . . . . . . . . . . . . . . . . . 109
10.4 Waiver by Company and the Permitted
Borrowers of Certain Laws. . . . . . . . . . . . . . . . . . 109
10.5 Waiver of Defaults. . . . . . . . . . . . . . . . . . . . . . . 109
11. PAYMENTS, RECOVERIES AND COLLECTIONS. . . . . . . . . . . . . . . . . . . 110
11.1 Payment Procedure. . . . . . . . . . . . . . . . . . . . . . . 110
11.2 Application of Proceeds. . . . . . . . . . . . . . . . . . . . 112
11.3 Pro-rata Recovery. . . . . . . . . . . . . . . . . . . . . . . 112
11.4 Deposits and Accounts. . . . . . . . . . . . . . . . . . . . . 112
12. CHANGES IN LAW OR CIRCUMSTANCES; INCREASED COSTS. . . . . . . . . . . . . 113
12.1 Reimbursement of Prepayment Costs. . . . . . . . . . . . . . . 113
12.2 Eurocurrency Lending Office. . . . . . . . . . . . . . . . . . 114
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TABLE OF CONTENTS
(Continued)
Page
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12.3 Availability of Alternative Currency. . . . . . . . . . . . . . 114
12.4 Refunding Advances in Same Currency. . . . . . . . . . . . . . 114
12.5 Circumstances Affecting Eurocurrency-based
Rate or Alternative Currency Availability. . . . . . . . . . 114
12.6 Laws Affecting Eurocurrency-based or
Alternative Currency Advance Availability. . . . . . . . . . 115
12.7 Increased Cost of Eurocurrency-based or
Alternative Currency Advances. . . . . . . . . . . . . . . . 116
12.8 Indemnity. . . . . . . . . . . . . . . . . . . . . . . . . . . 117
12.9 Judgment Currency. . . . . . . . . . . . . . . . . . . . . . . 117
12.10 Other Increased Costs. . . . . . . . . . . . . . . . . . . . . 118
13. AGENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 119
13.1 Appointment of Agent. . . . . . . . . . . . . . . . . . . . . . 119
13.2 Deposit Account with Agent. . . . . . . . . . . . . . . . . . . 119
13.3 Exculpatory Provisions. . . . . . . . . . . . . . . . . . . . . 119
13.4 Successor Agents. . . . . . . . . . . . . . . . . . . . . . . . 120
13.5 Loans by Agent. . . . . . . . . . . . . . . . . . . . . . . . . 120
13.6 Credit Decisions. . . . . . . . . . . . . . . . . . . . . . . . 120
13.7 Notices by Agent. . . . . . . . . . . . . . . . . . . . . . . . 121
13.8 Agent's Fees. . . . . . . . . . . . . . . . . . . . . . . . . . 121
13.9 Nature of Agency. . . . . . . . . . . . . . . . . . . . . . . . 121
13.10 Actions; Confirmation of Agent's Authority
to Act in Event of Default. . . . . . . . . . . . . . . . . . 121
13.11 Authority of Agent to Enforce Notes and
This Agreement. . . . . . . . . . . . . . . . . . . . . . . . 122
13.12 Indemnification. . . . . . . . . . . . . . . . . . . . . . . . 122
13.13 Knowledge of Default. . . . . . . . . . . . . . . . . . . . . . 122
13.14 Agent's Authorization; Action by Banks. . . . . . . . . . . . . 123
13.15 Enforcement Actions by the Agent. . . . . . . . . . . . . . . . 123
13.16 Co-Agent. . . . . . . . . . . . . . . . . . . . . . . . . . . . 123
14. MISCELLANEOUS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 124
14.1 Accounting Principles. . . . . . . . . . . . . . . . . . . . . 124
14.2 Consent to Jurisdiction. . . . . . . . . . . . . . . . . . . . 124
14.3 Law of Michigan. . . . . . . . . . . . . . . . . . . . . . . . 124
14.4 Interest. . . . . . . . . . . . . . . . . . . . . . . . . . . . 125
14.5 Closing Costs; Other Costs. . . . . . . . . . . . . . . . . . . 125
14.6 Notices. . . . . . . . . . . . . . . . . . . . . . . . . . . . 126
14.7 Further Action. . . . . . . . . . . . . . . . . . . . . . . . . 126
14.8 Successors and Assigns; Assignments and
Participations. . . . . . . . . . . . . . . . . . . . . . . . 126
14.9 Indulgence. . . . . . . . . . . . . . . . . . . . . . . . . . . 130
14.10 Counterparts. . . . . . . . . . . . . . . . . . . . . . . . . . 130
14.11 Amendment and Waiver. . . . . . . . . . . . . . . . . . . . . . 130
14.12 Taxes and Fees. . . . . . . . . . . . . . . . . . . . . . . . . 131
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TABLE OF CONTENTS
(Continued)
Page
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14.13 Confidentiality. . . . . . . . . . . . . . . . . . . . . . . 131
14.14 Withholding Taxes. . . . . . . . . . . . . . . . . . . . . . 131
14.15 Effective Upon Execution. . . . . . . . . . . . . . . . . . . 132
14.16 Severability. . . . . . . . . . . . . . . . . . . . . . . . . 132
14.17 Table of Contents and Headings. . . . . . . . . . . . . . . . 132
14.18 Construction of Certain Provisions. . . . . . . . . . . . . . 133
14.19 Independence of Covenants. . . . . . . . . . . . . . . . . . 133
14.20 Reliance on and Survival of Various
Provisions. . . . . . . . . . . . . . . . . . . . . . . . . 133
14.21 Complete Agreement. . . . . . . . . . . . . . . . . . . . . . 133
EXHIBITS
--------
FORM OF REQUEST FOR ADVANCE . . . . . . . . . . . . . . . . . . . . . A
FORM OF REVOLVING CREDIT NOTE -- COMPANY . . . . . . . . . . . . . . . B-1
FORM OF REVOLVING CREDIT NOTE -- PERMITTED BORROWER . . . . . . . . . B-2
PERCENTAGES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . C
SUBLIMITS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . D
FORM OF SWING LINE NOTE -- COMPANY . . . . . . . . . . . . . . . . . . E-1
FORM OF SWING LINE NOTE -- PERMITTED BORROWER . . . . . . . . . . . . E-2
FORM OF REQUEST FOR SWING LINE ADVANCE . . . . . . . . . . . . . . . . F
FORM OF NOTICE OF ISSUANCE OF LETTER OF CREDIT . . . . . . . . . . . . G
FORM OF TERM NOTE -- COMPANY . . . . . . . . . . . . . . . . . . . . . H-1
FORM OF TERM NOTE -- PERMITTED BORROWER . . . . . . . . . . . . . . . H-2
FORM OF TERM LOAN INITIAL REQUEST . . . . . . . . . . . . . . . . . . I
FORM OF TERM LOAN RATE REQUEST . . . . . . . . . . . . . . . . . . . . J
FORM OF FIXED RATE ELECTION . . . . . . . . . . . . . . . . . . . . . K
FORM OF COVENANT COMPLIANCE REPORT . . . . . . . . . . . . . . . . . . L
FORM OF JOINDER AGREEMENT:
DOMESTIC GUARANTY . . . . . . . . . . . . . . . . . . . . . . M-1
PERMITTED BORROWER GUARANTY . . . . . . . . . . . . . . . . . M-2
FORM OF ASSIGNMENT AGREEMENT . . . . . . . . . . . . . . . . . . . . . N
SCHEDULES
---------
[TO BE LISTED]
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CREDIT AGREEMENT
THIS CREDIT AGREEMENT ("Agreement") is made as of the 26th day of
July, 1995, by and among the Banks signatory hereto (individually, "Bank", and
collectively "Banks"), Comerica Bank, as agent for the Banks (in such capacity,
"Agent"), and Walbro Corporation, a Delaware corporation ("Company").
RECITALS:
A. Company has requested that the Banks: (i) extend to it and to
the Permitted Borrowers (as defined below), credit in the aggregate amount of
up to One Hundred Thirty-Five Million Dollars ($135,000,000) consisting of the
Revolving Credit, Swing Line Advances, Letters of Credit and Term Loans (each
as defined below), on the terms and conditions set forth herein.
B. The Banks are prepared to extend such credit as aforesaid, but
only upon the terms and conditions set forth in this Agreement.
NOW THEREFORE, COMPANY, AGENT AND THE BANKS AGREE:
1. DEFINITIONS
For the purposes of this Agreement the following terms will have the
following meanings:
1.1 "Account(s)" shall mean any account or account receivable
as defined under the UCC, including without limitation, with respect to any
Person, any right of such Person to payment for goods sold or leased or for
services rendered.
1.2 "Account Debtor" shall mean the party who is obligated on
or under any Account.
1.3 "Account Party(ies)" shall mean, with respect to any Letter
of Credit, the account party or parties (which shall be Company individually,
or jointly and severally with a Permitted Borrower) named in an application to
the Agent for the issuance of such Letter of Credit.
1.4 "Activation Fee" shall mean the fee payable by Company to
Agent, for distribution to the Banks based on their respective Percentages, in
connection with each activation of the Revolving Credit Designated Unused
Portion under Section 2.17 hereof and each request for the funding of a Term
Loan under Section 4.9A hereof, in each case in the respective amounts set
forth therein.
1.5 "Advance(s)" shall mean, as the context may indicate, a
borrowing requested by Company or by a Permitted Borrower, and made by Banks
under Section 2.1 or 4.1 of this Agreement, as the
13
case may be, or requested by the Company or by a Permitted Borrower and made by
the Swing Line Bank under Section 2.5 hereof, including without limitation any
readvance, refunding or conversion of such borrowing pursuant to Section 2.3,
2.5(c) or 4.9B hereof, any advance in respect of a Letter of Credit under
Section 3.6 hereof, and shall include, as applicable, a Eurocurrency-based
Advance, a Prime-based Advance, a Quoted Rate Advance, a Fixed Rate Advance and
a Swing Line Advance.
1.6 "Affiliate" shall mean, with respect to any Person, any
other Person or group acting in concert in respect of the first Person that,
directly or indirectly, through one or more intermediaries, controls, or is
controlled by, or is under common control with such first Person. For purposes
of this definition, "control" (including, with correlative meanings, the terms
"controlled by" and "under common control with"), as used with respect to any
Person or group of Persons, shall mean the possession, directly or indirectly,
of the power to direct or cause the direction of management and policies of
such Person, whether through the ownership of voting securities or by contract
or otherwise.
1.7 "Agent" shall mean Comerica Bank, a Michigan banking
corporation, or any successor appointed in accordance with Section 13.4 hereof.
1.8 "Agent's Correspondent" shall mean such bank or banks as
Agent may from time to time designate by written notice to Company, the
Permitted Borrowers and the Banks as its correspondent for Advances in
Eurodollars or in particular Alternative Currencies.
1.9 "Agent's Fees" shall mean those fees and expenses required
to be paid by Company to Agent under Section 13.8 hereof.
1.10 "Alternate Base Rate" shall mean, for any day, an interest
rate per annum equal to the Federal Funds Effective Rate in effect on such day,
plus one percent (1%).
1.11 "Alternative Currency" shall mean British Pounds Sterling
("Sterling"), French Francs ("FF"), Japanese Yen ("Y."), Deutsche Marks ("DM"),
Norwegian Krone ("K"), Spanish Peseta ("SP"), Belgian Francs ("BF") and,
subject to the prior written approval of Agent and each of the Banks and to the
terms and conditions of this Agreement, such other freely convertible foreign
currencies (which, when referred to herein or in any of the other Loan
Documents, shall be referred to using the currency codes in effect from time to
time under ISO International Standard 4217, or any such successor publication
or standard) as requested by the Company or a Permitted Borrower.
2
14
1.12 "Alternative Currency Principal Limit" shall mean, with
respect to each Term Loan funded in an Alternative Currency, the initial
principal amount of such Term Loan (stated in the applicable Alternative
Currency) minus the sum of (a) the amount of any payments or prepayments of
principal made on such Term Loan on or prior to the date of any determination
of such Alternative Currency Principal Limit and (b) the amount of any
principal repayments on the Term Loan scheduled to be paid under Section 4.3
hereof or required to be paid under Section 4.2 hereof on or prior to the date
of any determination of such Alternative Currency Principal Limit.
1.13 "Applicable Fee Percentage" shall mean, as of any date of
determination thereof, the applicable percentage used to calculate certain of
the fees due and payable hereunder, determined (based on the Funded Debt Ratio)
by reference to the appropriate columns in the Pricing Matrix attached to this
Agreement as Schedule 5.1.
1.14 "Applicable Interest Rate" shall mean the
Eurocurrency-based Rate, the Quoted Rate or the Prime-based Rate, as selected
by Company or a Permitted Borrower from time to time, subject to the terms and
conditions of this Agreement, and, if elected by the Company or a Permitted
Borrower pursuant to Section 4.11 hereof, the Fixed Rate.
1.15 "Applicable Margin" shall mean, as of any date of
determination thereof, the applicable interest rate margin, determined (based
on the Funded Debt Ratio) by reference to the appropriate columns in the
Pricing Matrix attached to this Agreement as Schedule 5.1.
1.16 "Assignment Agreement" shall have the meaning ascribed to
such term in Section 14.8(d) hereof.
1.17 "Banks" shall mean Comerica Bank, any other Banks signatory
hereto, and any assignee which becomes a Bank pursuant to Section 14.8(d)
hereof.
1.18 "Business Day" shall mean any day on which commercial banks
are open for domestic and international business (including dealings in foreign
exchange) in Detroit, London (except with respect to any Prime-based Advances),
and New York and if funds are to be paid or made available in any Alternative
Currency, on such day in the place where such funds are to be paid or made
available.
1.19 "Capital Expenditures" shall mean, without duplication, any
amounts paid or accrued for a period in respect of any purchase or other
acquisition for value of fixed or capital assets; provided that, in no event
shall Capital Expenditures include amounts expended in respect of normal repair
and maintenance of plant facilities, machinery, fixtures and other like capital
assets
3
15
utilized in the ordinary conduct of business (to the extent such amounts would
not be capitalized in preparing a balance sheet determined in accordance with
GAAP).
1.20 "Capitalized Lease Obligations" shall mean, at any time, a
lease obligation with respect to which the lessee is required by GAAP to
recognize the acquisition of an asset and the incurrence of a liability at such
time.
1.21 "Closing Fee" shall mean the fee payable to the Agent upon
closing of this Agreement in accordance with the Agency Fee Letter.
1.22 "Co-Agent" shall mean [Reserved].
1.23 "Collateral" shall mean all property or rights in which a
security interest, mortgage, lien or other encumbrance for the benefit of the
Lenders is or has been granted or arises or has arisen, under or in connection
with this Agreement, the Loan Documents, the Existing Senior Debt Documents, or
otherwise.
1.24 "Collateral Agent" shall mean Comerica, acting in its
capacity as Collateral Agent for the Lenders under the Intercreditor Agreement.
1.25 "Collateral Documents" shall mean the Company Collateral
Documents and the Guarantor Collateral Documents executed and delivered by
Company and by certain of Company's Subsidiaries, as the case may be, to the
Collateral Agent, in accordance with the terms and conditions of this
Agreement, as the same may be amended from time to time.
1.26 "Company" shall mean Walbro Corporation, a Delaware
corporation.
1.27 "Company Collateral Documents" shall mean the Company
Security Agreement, and all of the other acknowledgments, certificates,
financing statements, instruments and other security documents executed by
Company and delivered to the Collateral Agent, as of the date hereof or, from
time to time, subsequent thereto, in connection with such security agreement,
this Agreement, the Loan Documents, and the Existing Senior Debt Documents, as
such collateral documents may be amended, restated, supplemented or replaced
from time to time.
1.28 "Company Guaranty" shall mean that certain guaranty of all
of the Indebtedness outstanding from the Permitted Borrowers hereunder,
executed and delivered by the Company to the Agent, on behalf of the Banks as
of the date hereof, as amended, restated, supplemented or replaced from time to
time.
4
16
1.29 "Company Security Agreement" shall mean that certain stock
pledge and security agreement encumbering the Accounts, Inventory and general
intangibles of Company and the shares of stock or share capital of Company in
certain of its Subsidiaries, now owned or hereafter acquired (all as set forth
therein), executed and delivered by Company to the Collateral Agent as of the
date hereof as security for the Lender Debt, as the same may be amended,
restated, supplemented or replaced from time to time.
1.30 "Consolidated" or "Consolidating" shall, when used with
reference to any financial information pertaining to (or when used as a part of
any defined term or statement pertaining to the financial condition of) Company
and its Subsidiaries, mean the accounts of Company and its Subsidiaries
determined on a consolidated or consolidating basis, as the case may be, all
determined as to principles of consolidation and, except as otherwise
specifically required by the definition of such term or by such statements, as
to such accounts, in accordance with GAAP applied on a consistent basis and
consistent with the financial statements as at and for the fiscal year ended
December 31, 1994.
1.31 "Consolidated Intangible Assets" shall mean, as of any date
of determination thereof, the amount of good will, patents, trade names, trade
marks, copyrights, franchises, experimental expense, organization expense,
unamortized debt discount and expense, deferred assets other than prepaid
insurance and prepaid taxes, the excess of cost of shares acquired over book
value of related assets and such other assets as are properly classified as
"intangible assets" determined on a Consolidated basis in accordance with GAAP
(but expressly excluding the value of the technology licenses for Orbital
Engine Company Ltd. and cash surrender values under key employee insurance
policies), in each case determined for the Company and its Subsidiaries on a
Consolidated basis.
1.32 "Consolidated Net Income" shall mean, in respect of any
period, the net income (loss) of Company and its Subsidiaries, determined on a
Consolidated basis in accordance with GAAP, for such period.
1.33 "Consolidated Tangible Net Worth" shall mean, as of any date
of determination thereof, (a) the amount of capital stock accounts plus (or
minus in the case of a deficit) the paid-in capital and retained earnings of the
Company and its Subsidiaries; plus (b) to the extent not included in
subparagraph (a) above, an amount equal to the liquidation preference of issued
and outstanding preferred stock of the Company; plus (c) to the extent not
included in subparagraph (a) above, Minority Interests; plus (d) deferred income
taxes; plus (e) the unpaid principal amount of any outstanding Subordinated
Debt; plus (f) $2,900,000; minus (g) the net book value, after deducting any
reserves applicable thereto, of all items of the following character which are
included
5
17
in the assets of the Company and its Subsidiaries: (i) Consolidated Intangible
Assets; (ii) any increment resulting from any reappraisal, revaluation or
writeup of assets; and (iii) treasury stock, all determined on a Consolidated
basis for the Company and its Subsidiaries in accordance with GAAP.
1.34 "Continuing Directors" shall mean the directors of the
Company on the effective date of this Agreement and each other director of the
Company, if such other director's nomination or election to the board of
directors of the Company is recommended by a majority of the then Continuing
Directors.
1.35 "Contractual Obligation" shall mean, as to any Person, any
provision of any security issued by such Person or of any agreement, instrument
or written undertaking to which such Person is a party or by which it or any of
its property is bound.
1.36 "Covenant Compliance Report" shall mean the report to be
furnished by the Company to the Agent, in substantially the form attached to
this Agreement as Exhibit "L" and certified by the chief financial officer of
the Company pursuant to Section 8.3(b) and 8.3(c), hereof, as to whether the
Company and its Subsidiaries are in compliance with the financial and other
covenants contained in Sections 8.4 through 8.6, inclusive, and 9.5, 9.6, 9.8
and 9.11, inclusive, of this Agreement, in which report the Company shall set
forth its calculations and the resultant ratios or financial tests determined
thereunder.
1.37 "Current Dollar Equivalent" shall mean at any time, with
respect to any Advance in an Alternative Currency, the amount of Dollars which
is equivalent to the then outstanding principal amount of such Advance at the
most favorable spot exchange rate determined by the Agent to be available to it
for the sale of Dollars for such Alternative Currency for delivery at
approximately 11:00 A.M. (Detroit time) two (2) Business Days after such date.
Alternative Currency equivalents of Advances in Dollars (to the extent used
herein) shall be determined by Agent in a manner consistent herewith.
1.38 "Current Shareholder and Management Group" shall mean (i)
Lambert A. Althaver, Robert H. Walpole, Gary L. Vollmar, Richard H. Whitehead
III, Michael A. Shope and Daniel L. Hittler; (ii) the spouses, lineal
descendants and spouses of the lineal descendants of the persons named in
clause (i); and (iii) the estates or legal representatives of the persons named
in clauses (i) and (ii).
1.39 "De Minimis Matters" shall mean environmental or other
matters, the existence of which and any liability which may result therefrom,
could not, individually or in the aggregate, have a material adverse effect on
the financial condition or businesses of the Company or any of its Subsidiaries
or on the ability of the
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Company or any of its Subsidiaries to pay its Debts, as such Debts become due.
1.40 "Debt" shall mean, as of any applicable date of
determination, all items of indebtedness, obligation or liability of a Person,
whether matured or unmatured, liquidated or unliquidated, direct or indirect,
absolute or contingent, joint or several, that should be classified as
liabilities on a balance sheet and in accompanying footnotes in accordance with
GAAP, including without limitation, reimbursement obligations in respect of
letters of credit, obligations in respect of bankers acceptances, payment
obligations, if any, under interest rate protection agreements (including
without limitation interest rate swaps and similar agreements), and currency
swaps and hedges and similar agreements; provided, however that for purposes of
calculating the aggregate Debt of Company and its Subsidiaries, the direct and
indirect and absolute and contingent obligations of Company and the Guarantors
(whether direct or contingent) shall be determined without duplication.
1.41 "Default" shall mean any event which, with the giving of
notice or the passage of time, or both, would constitute an Event of Default.
1.42 "Dollar Amount" shall mean (i) with respect to each Advance
made or carried (or to be made or carried) in Dollars, the principal amount
thereof and (ii) with respect to each Advance made or carried (or to be made or
carried) in an Alternative Currency, the amount of Dollars which is equivalent
to the principal amount of such Advance at the most favorable spot exchange
rate determined by the Agent to be available to it for the sale of Dollars for
such Alternative Currency at approximately 11:00 A.M. (Detroit time) two (2)
Business Days before such Advance is made (or to be made), as such Dollar
Amount may be adjusted from time to time pursuant to Section 2.11 hereof or
otherwise hereunder. When used with respect to any Alternative Currency portion
of an Advance being repaid or remaining outstanding at any time or with respect
to any other sum expressed in an Alternative Currency, "Dollar Amount" shall
mean the amount of Dollars which is equivalent to the principal amount of such
Advance, or the amount so expressed in such Alternative Currency, at the most
favorable spot exchange rate determined by the Agent to be available to it for
the sale of Dollars for such Alternative Currency at the relevant time.
Alternative Currency amounts of Advances made, carried or expressed in Dollars
(to the extent used herein) shall be determined by Agent in a manner consistent
herewith.
1.43 "Dollars" and the sign "$" shall mean lawful money of the
United States of America.
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1.44 "Domestic Advance" shall mean any Advance other than a
Eurocurrency-based Advance or any other Advance denominated in an Alternative
Currency.
1.45 "Domestic Guaranty" shall mean that certain guaranty
agreement containing the unconditional guaranties of borrowings hereunder by
Company and the Permitted Borrowers, executed and delivered by the Significant
Domestic Subsidiaries to the Banks as of the date hereof (or, pursuant to
Section 8.17 hereof, subsequent to the date of this Agreement), as amended,
restated, supplemented or replaced from time to time.
1.46 "Domestic Subsidiaries" shall mean those Subsidiaries of
the Company incorporated under the laws of the United States of America, or any
state thereof.
1.47 "Dyno" shall mean Dyno Industrier AS, a Norwegian
corporation.
1.48 "Dyno Acquisition Agreement" shall mean that certain
Purchase and Sale Agreement entered into between Dyno, as seller, and the
Company, as purchaser, dated as of April 7, 1995, as amended to the date
hereof, and as further amended (subject to the terms hereof) from time to time.
1.49 "Dyno Acquisition" shall mean the acquisition by the
Company, subject to the terms hereof, of the assets, properties, rights and
business of Dyno (and certain subsidiaries of Dyno) for the price and on the
terms and conditions set forth in the Dyno Acquisition Agreement.
1.50 "Dyno Capital Expenditures" shall mean all Capital
Expenditures of the Company and its Subsidiaries made as part of, or in support
(whether directly or indirectly) of the operations acquired by the Company and
its Subsidiaries pursuant to or in connection with the Dyno Acquisition,
excluding Capital Expenditures in an amount not to exceed Twelve Million
Dollars ($12,000,000) in the aggregate, for or in connection with the European
research and development facility to be constructed by the Company or a
Significant Foreign Subsidiary.
1.51 "EBITDA" shall mean, with respect to any period, net
earnings (or loss) before gross interest expense, depreciation, good will,
amortization and taxes and before reflecting extraordinary gains (losses),
gains (losses) from discontinued operations and gains (losses) from Minority
Interests and Joint Ventures for such period, as determined in accordance with
GAAP.
1.52 "Equity Offering" shall mean the issuance and sale by the
Company or any of its Subsidiaries of additional capital stock or other equity
interests.
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1.53 "Equity Offering Adjustment" shall mean that amount to be
added to the minimum Consolidated Tangible Net Worth required to be maintained
under Section 8.4 hereof consisting of an amount equal to one hundred percent
(100%) of each Equity Offering conducted by the Company or any of its
Subsidiaries (plus the result of any merger or acquisition), net of costs of
issuance, on or after the date hereof, on a cumulative basis.
1.54 "ERISA" shall mean the Employee Retirement Income Security
Act of 1974, as amended, or any successor act or code, and the regulations in
effect from time to time thereunder.
1.55 "ERISA Affiliate" shall mean any trade or business (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 would be treated as a single employer under Section 414(b) or (c)
of the Internal Revenue Code.
1.56 "Eurocurrency-based Advance" shall mean any Advance
(including a Swing Line Advance) which bears interest at the Eurocurrency-based
Rate.
1.57 "Eurocurrency-based Rate" shall mean a per annum interest
rate which is the Applicable Margin (subject in each case to adjustment under
Section 5.1 hereof) above the quotient of:
(i) the per annum interest rate at which deposits in the
relevant eurocurrency are offered to Agent's
Eurocurrency Lending Office by other prime banks in
the eurocurrency market in an amount comparable to
the relevant Eurocurrency-based Advance and for a
period equal to the relevant Eurocurrency-Interest
Period at approximately 11:00 A.M. Detroit time two
(2) Business Days prior to the first day of such
Eurocurrency-Interest Period, divided by
(ii) a percentage equal to 100% minus the maximum rate on
such date at which Agent is required to maintain
reserves on `Eurocurrency Liabilities' as defined in
and pursuant to Regulation D of the Board of
Governors of the Federal Reserve System or, if such
regulation or definition is modified, and as long as
Agent is required to maintain reserves against a
category of liabilities which includes eurocurrency
deposits or includes a category of assets which
includes eurocurrency loans, the rate at which such
reserves are required to be maintained on such
category,
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such sum to be rounded upward, if necessary, to the nearest whole multiple of
1/100th of 1%.
1.58 "Eurocurrency-Interest Period" shall mean, (a) for Swing
Line Advances, an Interest Period of one month (or any lesser number of days
agreed to in advance by Company or a Permitted Borrower, Agent and the Swing
Line Bank) and (b) for all other Eurocurrency-based Advances, an Interest
Period of one, two, three or six months (or any lesser or greater number of
days agreed to in advance by Company or a Permitted Borrower, Agent and the
Banks), as selected by Company or a Permitted Borrower, as applicable, for a
Eurocurrency-based Advance pursuant to Section 2.3, 2.5 or 4.9B hereof, as the
case may be.
1.59 "Eurocurrency Lending Office" shall mean, (a) with respect
to the Agent, Agent's office located at its Grand Caymans Branch or such other
branch of Agent, domestic or foreign, as it may hereafter designate as its
Eurocurrency Lending Office by notice to Company, the Permitted Borrower and
the Banks and (b) as to each of the Banks, its office, branch or affiliate
located at its address set forth on the signature pages hereof (or identified
thereon as its Eurocurrency Lending Office), or at such other office, branch or
affiliate of such Bank as it may hereafter designate as its Eurocurrency
Lending Office by notice to Company and Agent.
1.60 "Event of Default" shall mean each of the Events of Default
specified in Section 10.1 hereof.
1.61 "Excess Cash Flow" shall mean for any fiscal year (using
the terms contained in the Company's Consolidated financial statements for its
fiscal year ending December 31, 1994 and the sources and uses statement
contained in Company's 10-K Report filed with the Federal Securities and
Exchange Commission in respect of such period), net cash provided by operating
activities for such fiscal year, less purchase of property and equipment for
such fiscal year, less principal payments on long-term debt for such fiscal
year (including all principal payments based on Excess Cash Flow made on the
Term Loan under Section 4.3 hereof, if any, during such fiscal year, but
excluding all payments on the Revolving Credit, or any other revolving loan
facility utilized at any time by Company or any of its Subsidiaries), all
calculated based upon Company's annual Consolidated financial statements
required to be delivered to Agent and the Banks under Section 8.3(b) hereof.
1.62 "Existing Senior Debt" shall mean the senior debt issued by
the Company pursuant to the Senior Debt Documents in an aggregate principal
amount of Forty-Five Million Dollars ($45,000,000).
1.63 "Existing Senior Debt Documents" shall mean that certain
Walbro Corporation Note Purchase Agreement dated as of
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October 1, 1994 ($45,000,000 7.68% Senior Notes due October 1, 2004) and the
Existing Senior Notes issued thereunder, together with any and all other
documents, instruments and certificates executed and delivered pursuant thereto,
as the same may be amended from time to time (subject to the terms hereof) and
any and all other documents executed in exchange therefor or in replacement or
renewal thereof.
1.64 "Existing Senior Note Purchasers" shall mean the note
purchasers which are signatories to the Existing Senior Debt Documents, and
their respective successors and assigns.
1.65 "Existing Senior Notes" shall mean the senior notes issued
by the Company to the Existing Senior Note Purchasers pursuant to the Existing
Senior Debt Documents as evidence of the Existing Senior Debt, as such notes
may be amended, extended or supplemented from time to time, and any other notes
issued in substitution, renewal or replacement thereof from time to time.
1.66 "Federal Funds Effective Rate" shall mean, for any day, a
fluctuating interest rate per annum equal to the weighted average of the rates
on overnight Federal funds transactions with members of the Federal Reserve
System arranged by Federal funds brokers, as published for such day (or, if
such day is not a Business Day, for the next preceding 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 such day on such
transactions received by Agent from three Federal funds brokers of recognized
standing selected by it.
1.67 "Fees" shall mean the Agent's Fees, the Closing Fee, the
Activation Fee, the Letter of Credit Fees and the Revolving Credit Commitment
Fee and the other fees and charges payable hereunder.
1.68 "Fixed Charge Coverage Ratio" shall mean a ratio, the
numerator of which consists of the EBITDA of Company and its Subsidiaries for
the four fiscal quarters immediately preceding the applicable date of
determination, minus the aggregate Capital Expenditures of Company and its
Subsidiaries during such period (excluding in such calculations through and
including June 30, 1996, all Dyno Capital Expenditures, but including in such
calculations beginning September 30, 1996 all Dyno Capital Expenditures) and the
denominator of which consists of gross interest expense of Company and its
Subsidiaries for such period, all determined without duplication in accordance
with GAAP on a Consolidated basis.
1.69 "Fixed Rate" shall mean the per annum fixed rate of interest
for a speci ufied Term Loan established by the Agent under Section 4.11 hereof,
such rate to be based on (a) an average of the funding cost of each of the
Reference Banks on that date which is
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three (3) Business Days prior to the effective date of an election of the Fixed
Rate Option pursuant to Section 4.11 hereof, as determined by each such
Reference Bank in the interbank swap market for the weighted average life of the
specified Term Loan then remaining, plus (b) the Applicable Margin which would
then be in effect for Eurocurrency-based Rate Advances of such Term Loan if the
Company or the applicable Permitted Borrower had selected such rate, subject to
any applicable margin adjustment under Section 5.1 hereof, giving immediate
effect thereto based on the most current quarterly financial statement delivered
by the Company under Section 8.3(b) or 8.3(c) hereof, as the case may be.
1.70 "Fixed Rate Advance" shall mean any Advance of a Term Loan
carried at the Fixed Rate.
1.71 "Fixed Rate Option" shall mean the right of the Company or
a Permitted Borrower, subject to and in accordance with Section 4.11 hereof, to
elect the Fixed Rate as the Applicable Interest Rate for a specified Term Loan.
1.72 "Fixed Rate Election" shall mean the written election of
the Fixed Rate as the Applicable Interest Rate for a specified Term Loan,
submitted by the Company or a Permitted Borrower under Section 4.11 hereof, in
the form attached hereto as Exhibit "K."
1.73 "Foreign Subsidiaries" shall mean all of the Company's
Subsidiaries other than the Domestic Subsidiaries.
1.74 "Funded Debt" shall mean, on a Consolidated basis and
without duplication (i) all Debt of the Company and its Subsidiaries for
borrowed money or which has been incurred in connection with the acquisition of
assets, excluding intercompany items, (ii) all Capitalized Lease Obligations of
the Company and its Subsidiaries, and (iii) all guaranties by any Person of
Funded Debt of any other person, including without limitation any and all
agreements, contingent or otherwise, to support the obligation of such other
Person, whether or not denominated as a guaranty, any letter of credit
reimbursement obligations and any other such agreement or undertaking which
would constitute a guaranty for purposes of GAAP, consistently applied.
1.75 "Funded Debt Ratio" shall mean a ratio, the numerator of
which consists of the Funded Debt of the Company and its Subsidiaries as of the
applicable date of determination, and the denominator of which consists of the
EBITDA of the Company and its Subsidiaries for the four fiscal quarters
immediately preceding such date of determination, all determined without
duplication in accordance with GAAP on a Consolidated basis.
1.76 "GAAP" shall mean generally accepted accounting principles
in the United States of America (except as otherwise expressly stated herein) as
in effect (i) for purposes of
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calculating any financial covenants or ratios hereunder, on the date hereof,
consistently applied, and (ii) for all other purposes, as in effect from time to
time.
1.77 "Guaranties" shall mean the Company Guaranty, the Domestic
Guaranty and the Permitted Borrowers Guaranty, and "Guaranty" shall mean each
and any of such Guaranties, as the context may indicate.
1.78 "Guarantor Collateral Documents" shall mean the Guarantor
Security Agreement, the local share pledges identified therein ("Local Share
Pledges") and all other acknowledgments, certificates, financing statements,
instruments, local share pledges and other security documents executed by the
Domestic Guarantors and delivered to Collateral Agent, as of the date hereof
or, from time to time, subsequent thereto, in connection with such security
agreements, this Agreement, any of the other Loan Documents and the Existing
Senior Debt Documents, as such collateral documents may be amended, restated,
supplemented or replaced from time to time.
1.79 "Guarantor Security Agreement[s]" shall mean those certain
stock pledges and security agreements encumbering the accounts, inventory and
general intangibles of the Domestic Guarantors and the shares of stock or share
capital of certain of the Significant Subsidiaries now owned or hereafter
acquired by the Domestic Guarantors (or any of them) (as set forth therein),
executed and delivered by the Domestic Guarantors to the Collateral Agent, as
of the date hereof as security for the Lender Debt, as amended, restated,
supplemented or replaced from time to time, and each security agreement or
other security document executed and delivered from and after the date hereof
by a Significant Domestic Subsidiary which becomes a Guarantor hereunder
subsequent to the date hereof in accordance with this Agreement.
1.80 "Guarantor(s)" shall mean each Significant Subsidiary of
the Company and each Person otherwise becoming a Significant Subsidiary of the
Company subsequent to the date hereof or otherwise entering into a Guaranty (by
joinder agreement or otherwise) from time to time and shall as of the date of
execution of this Agreement consist of those Subsidiaries designated as
Guarantors on Schedule 7.6 hereto.
1.81 "Hazardous Material" shall mean and include any hazardous,
toxic or dangerous waste, substance or material defined as such in (or for
purposes of) the Hazardous Material Laws or in respect of which liability or
standards of conduct may be imposed under any such laws.
1.82 "Hazardous Material Law(s)" shall mean all laws, codes,
ordinances, rules, regulations, orders, decrees and directives issued by any
federal, state, local, foreign or other governmental
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or quasi-governmental authority or body (or any agency, instrumentality or
political subdivision thereof) pertaining to any hazardous, toxic, or dangerous
waste, substance or material on or about the Material Property or any portion
thereof including, without limitation, those relating to soil, surface,
subsurface ground water conditions and the condition of the ambient air; any
so-called "superfund" or "superlien" law; and any other federal, state, foreign
or local statute, law, ordinance, code, rule, regulation, order or decree
regulating, relating to, or imposing liability or standards of conduct
concerning, any hazardous, toxic or dangerous waste, substance or material, as
now or at any time hereafter in effect.
1.83 "Hereof", "hereto", "hereunder" and similar terms shall
refer to this Agreement in its entirety and not to any particular paragraph or
provision of this Agreement.
1.84 "HLT Determination" shall mean any determination by the
Agent or by the Majority Banks, or by applicable federal or state regulatory
authorities (including without limitation any central bank or other
governmental body having jurisdiction over any of the Banks) that the
Indebtedness (or any specific loan facility or portion thereof pursuant to this
Agreement) would be classified as a "highly-leveraged transaction" or an "HLT"
under applicable federal or state law, regulations or guidelines in effect from
time to time, provided that (a), with any determination of HLT status by Agent
or the Majority Banks, Agent shall have given Company not less than thirty (30)
days prior written notice of such determination, accompanied by a certificate
setting forth in reasonable detail the basis for such determination (which
shall be presumed correct absent manifest error) and (b) with respect to any
determination of HLT status by a federal or state regulatory authority, Agent
shall have given written notice thereof to Company, accompanied by a copy of
such determination (if in writing).
1.85 "Indebtedness" shall mean all indebtedness and liabilities,
whether direct or indirect, absolute or contingent, owing by Company or any of
the Permitted Borrowers to the Banks (or any of them) or to the Agent, in any
manner and at any time, under this Agreement or the other Loan Documents,
whether evidenced by the Notes, the Company Guaranty, the Domestic Guaranty, the
Permitted Borrower Guaranty, or otherwise, due or hereafter to become due, now
owing or that may hereafter be incurred by the Company, or any of the Permitted
Borrowers to, or acquired by, the Banks or by Agent, and any judgments that may
hereafter be rendered on such indebtedness or any part thereof, with interest
according to the rates and terms specified, or as provided by law, and any and
all consolidations, amendments, renewals, replacements or extensions of any of
the foregoing.
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1.86 "Intercreditor Agreement" shall mean that certain
Intercreditor Agreement dated as of the date hereof, as the same may be amended
from time to time, by and among Company, the Agent, the Collateral Agent and
the Lenders.
1.87 "Intercompany Loan" shall mean any loan (or advance in the
nature of a loan) by the Company or any 100% Subsidiary to another 100%
Subsidiary, provided that each such loan or advance is subordinated in right of
payment and priority to the Indebtedness on terms and conditions satisfactory
to Agent and the Majority Banks.
1.88 "Intercompany Loans, Advances or Investments" shall mean
any Intercompany Loan, and any advance or investment by the Company or any 100%
Subsidiary (including without limitation any guaranty of obligations or
indebtedness to third parties) to or in another 100% Subsidiary.
1.89 "Interest Period" shall mean a Eurocurrency-Interest Period
commencing on the day a Eurocurrency-based Advance is made, or on the effective
date of an election of the Eurocurrency-based Rate made under Section 2.3,
2.5(c) or 4.9B hereof, as the case may be, or a Quoted Rate Interest Period
commencing on the day a Quoted-Rate Advance is made under Section 2.5(c)
hereof, provided that:
(a) any Interest Period which would otherwise end on a
day which is not a Business Day shall be extended to the next
succeeding Business Day, except that as to a Eurocurrency-Interest
Period, if the next succeeding Business Day falls in another calendar
month, such Eurocurrency-Interest Period shall end on the next
preceding Business Day, and when a Eurocurrency-Interest Period begins
on a day which has no numerically corresponding day in the calendar
month during which such Eurocurrency-Interest Period is to end, it
shall end on the last Business Day of such calendar month, and
(b) no Interest Period shall extend beyond the maturity
date set forth in the Note to which such Interest Period is to apply.
1.90 "Internal Revenue Code" shall mean the Internal Revenue
Code of 1986, as amended from time to time, and the regulations promulgated
thereunder.
1.91 "Investment" shall mean any loan, advance or extension of
credit by Company or any of its Subsidiaries to, or any other loan, advance
investment by Company or any of its Subsidiaries in (or guaranty or similar
undertaking for the benefit of), any Person (including without limitation, any
Subsidiary of Company), without offset, reduction or other adjustment, whether
such loan, advance or investment shall be in the nature of an investment in
shares of
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stock or other capital or securities, any contribution of capital, general or
limited partnership or joint venture interests, debentures, evidences of
indebtedness or otherwise.
1.92 "Issuing Office" shall mean Agent's office located at One
Detroit Center, 500 Woodward Avenue, Detroit, Michigan 48275 or such other
office as Agent shall designate as its Issuing Office.
1.93 "Japanese Term Loan" shall mean that certain Term Loan in
the aggregate principal amount of Seven Hundred Fifty Million Yen (Y.
750,000,000) to be advanced by the Banks to Walbro Japan pursuant to Section
4.1 hereof.
1.94 "Joinder Agreement" shall mean a joinder agreement in the
form attached to this Agreement as Exhibits "M-1" or "M-2"; as the case may be,
to be executed and delivered pursuant to Section 8.17 of this Agreement by any
Subsidiary specified therein or which becomes a Significant Subsidiary
subsequent to the date hereof.
1.95 "Joint Venture" shall mean any corporation, partnership,
association, joint stock company, business trust or other combined enterprise,
other than a Consolidated Subsidiary, in which (or to which) the Company or any
of its Subsidiaries has made a loan, investment or advance or has an ownership
stake or interest, whether in the nature of Share Capital, partnership or
equity interest or otherwise.
1.96 "Lender Debt" shall mean the Indebtedness and the Existing
Senior Debt.
1.97 "Lenders" shall mean each of the Banks and each of the
Existing Senior Note Purchasers and their respective successors and assigns.
1.98 "Letter of Credit Agreement" shall mean, in respect of each
Letter of Credit, the application and related documentation satisfactory to the
Agent of an Account Party or Account Parties requesting Agent to issue such
Letter of Credit, as amended from time to time.
1.99 "Letter of Credit Fees" shall mean the fees payable to
Agent for the accounts of the Banks in connection with Letters of Credit
pursuant to Section 3.4 hereof.
1.100 "Letter of Credit Maximum Amount" shall mean as of any date
of determination the lesser of: (a) Seventeen Million Dollars ($17,000,000); or
(b) the Revolving Credit Aggregate Commitment of the Banks as of such date,
minus the aggregate principal amount of Advances outstanding as of such date
under the Revolving Credit Notes and the Swing Line Note.
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1.101 "Letter of Credit Obligation(s)" shall mean the obligation
of an Account Party or Account Parties under each Letter of Credit Agreement to
reimburse the Agent for each payment made by the Agent under the Letter of
Credit issued pursuant to such Letter of Credit Agreement, together with all
other sums, fees, charges and amounts which may be owing to the Agent under
such Letter of Credit Agreement.
1.102 "Letter of Credit Payment" shall mean any amount paid or
required to be paid by the Agent in its capacity hereunder as issuer of a
Letter of Credit as a result of a draft or other demand for payment under any
Letter of Credit.
1.103 "Letter(s) of Credit" shall mean any standby or documentary
letters of credit issued by Agent at the request of or for the account of an
Account Party or Account Parties pursuant to Article 3 hereof, including
without limitation any Special Purpose Letter of Credit.
1.104 "Lien" shall mean any pledge, assignment, hypothecation,
mortgage, security interest, deposit arrangement, option, trust receipt,
conditional sale or title retaining contract, sale and leaseback transaction,
or any other type of lien, charge or encumbrance, whether based on common law,
statute or contract.
1.105 "Loan Documents" shall mean, collectively, this Agreement,
the Notes, the Company Guaranty, the Domestic Guaranty, the Permitted Borrower
Guaranty, the Company Collateral Documents, the Guarantor Collateral Documents
(including the Local Share Pledges), the Intercreditor Agreement and any other
documents, instruments or agreements executed pursuant to or in connection with
any such document, or this Agreement, as such documents may be amended,
renewed, supplemented or replaced from time to time.
1.106 "Majority Banks" shall mean at any time Banks holding
66-2/3% of the aggregate principal amount of the Indebtedness
then outstanding under the Notes, or, if no Indebtedness is then outstanding,
Banks holding 66-2/3% of the Percentages.
1.107 "Material Property" shall mean any property, whether
personal or real, owned, leased or otherwise used by the Company or any of its
Subsidiaries which is material to the operations of the Company and its
Subsidiaries, taken as a whole, or which is material to the operations of
Company or any of the Significant Subsidiaries.
1.108 "Minority Interests" shall mean any shares of stock of any
class of a Subsidiary (other than directors' qualifying shares as required by
law) that are not owned by the Company and/or one or more of its Subsidiaries.
Minority Interests shall be valued by valuing Minority Interests constituting
preferred stock at the
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voluntary or involuntary liquidating value of such preferred stock, whichever is
greater, and by valuing Minority Interests constituting common stock at the book
value of capital and surplus applicable thereto adjusted, if necessary, to
reflect any changes from the book value of such common stock required by the
foregoing method of valuing Minority Interests in preferred stock.
1.109 "Multiemployer Plan" shall mean any Pension Plan which is a
multiemployer plan as defined in Section 4001(a)(3) of ERISA.
1.110 "Net Income Adjustment" shall mean that amount to be added
to the minimum Consolidated Tangible Net Worth required to be maintained under
Section 8.4 hereof consisting of fifty percent (50%) of Company's Consolidated
Net Income for each of Company's fiscal years ending on or after December 31,
1995 (in each case, only if a positive number), on a cumulative basis.
1.111 "New Senior Debt" shall mean the additional senior debt to
be issued by the Company pursuant to the New Senior Debt Documents in an
aggregate principal amount of One Hundred Ten Million Dollars ($110,000,000).
1.112 "New Senior Debt Documents" shall mean that certain note
purchase agreement to be entered into between the Company and the New Senior
Note Purchasers with respect to the New Senior Debt, and the New Senior Notes
to be issued thereunder (all in form and substance acceptable to Agent and the
Majority Banks), together with any and all other documents, instruments and
certificates executed and delivered pursuant thereto, as the same may be
amended from time to time (subject to the terms hereof), and all other
documents executed in exchange therefor or in replacement or renewal thereof.
1.113 "New Senior Note Purchasers" shall mean the note purchasers
which become signatories to the New Senior Debt Documents, and their respective
successors and assigns.
1.114 "New Senior Notes" shall mean the senior notes to be issued
by the Company to the New Senior Note Purchasers.
1.115 "Notes" shall mean the Revolving Credit Notes, the Swing
Line Note, or the Term Notes or any or all of the Revolving Credit Notes, the
Swing Line Note and the Term Notes as the context indicates, and in the absence
of such indication, all such notes.
1.116 "PBGC" shall mean the Pension Benefit Guaranty Corporation
under ERISA, or any successor corporation.
1.117 "Pension Plan(s)" shall mean all employee pension benefit
plans of Company or any ERISA Affiliate, as defined in Section 3(2) of ERISA,
to the extent such Person is subject to
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ERISA, as provided in Section 4 of ERISA, which is subject to Section 412 of the
Code or Section 302 of ERISA.
1.118 "Percentage" shall mean, with respect to any Bank, its
percentage share, as set forth on Exhibit "C" hereto, of the Revolving Credit,
Letters of Credit and/or the Term Loans, as the context indicates, as such
Exhibit may be revised from time to time by Agent in accordance with Section
14.8(d) hereof.
1.119 "Permitted Acquisitions" shall mean (x) subject to
satisfaction by the Company of the Special Conditions on or before the Required
Consummation Date, the Dyno Acquisition and (y) any acquisition by the Company
or any of its Subsidiaries of assets, businesses or business interests or
shares of stock or other ownership interests of or in any Person primarily
engaged in those businesses in which Company and its Subsidiaries are engaged
on the date hereof or other businesses directly related thereto, conducted in
accordance with the following requirements:
(a) not less than thirty (30) nor more than ninety (90)
days prior to the commencement of each such proposed acquisition, the
Company provides written notice thereof to Agent (with drafts of all
material documents pertaining to such proposed acquisition to be
furnished to Agent not less than thirty (30) days prior to such
proposed acquisition);
(b) on the date of any such acquisition, all necessary
or appropriate governmental, quasi-governmental, agency, regulatory or
similar approvals of applicable jurisdictions (or the respective
agencies, instrumentalities or political subdivisions, as applicable,
of such jurisdictions) and all necessary or appropriate
non-governmental and other third-party approvals which, in each case,
are material to such acquisition have been obtained and are in effect,
and the Company and its Subsidiaries are in full compliance therewith,
and all necessary or appropriate declarations, registrations or other
filings with any court, governmental or regulatory authority,
securities exchange or any other person have been made;
(c) the aggregate value of all of such acquisitions,
including the value of any proposed new acquisition, conducted while
this Agreement remains in effect as Permitted Acquisitions (but
excluding the Dyno Acquisition, and any acquisition conducted with the
specific written approval of the Majority Banks, and not as a
Permitted Acquisition hereunder) computed on the basis of total
acquisition consideration paid or incurred, or to be paid or incurred,
by the Company or its Subsidiaries with respect thereto, including all
indebtedness which is assumed or to which such assets, businesses or
business or ownership interests or shares, or any Person so acquired,
is subject,
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shall not exceed Twenty- Five Million Dollars ($25,000,000) (or the
Alternative Currency equivalent thereof, if applicable), determined as
of the date of such acquisition;
(d) concurrently with such acquisition, the Company, its
Subsidiaries and any of the corporate entities involved in such
acquisition shall execute or cause to be executed, and provide or
cause to be provided to Agent, for the Banks, any Loan Documents
required hereunder and such other documents and instruments (including
without limitation opinions of counsel, amendments, acknowledgments,
consents and evidence of approvals or filings) as reasonably requested
by Agent, if any, and otherwise comply with the terms and conditions
of this Agreement; and
(e) both immediately before and after such acquisition,
no Default or Event of Default (whether or not related to such
acquisition), has occurred and is continuing.
1.120 "Permitted Borrower" shall mean, prior to the Dyno
Acquisition, Walbro Automotive, Walbro Engine Management, Sharon, Whitehead and
Walbro Japan; and from and after the Dyno Acquisition, Walbro Automotive,
Walbro Engine Management, Sharon, Whitehead, Walbro Japan, Walbro Norway,
Walbro England, Walbro Germany, Walbro France, Walbro Belgium and Walbro Spain;
provided however that the aggregate Advances of the Revolving Credit available
to Company and the Permitted Borrowers hereunder shall be subject at all times
to the applicable Sublimits and to the Revolving Credit Aggregate Commitment
and to the other terms and conditions hereof.
1.121 "Permitted Borrower Guaranty" shall mean that certain
unconditional guaranty of all Indebtedness outstanding from the Permitted
Borrowers which are Foreign Subsidiaries hereunder, executed and delivered by
the Significant Foreign Subsidiaries to the Banks as of the date hereof (or,
pursuant to Section 8.17 hereof, subsequent to the date of this Agreement), as
amended from time to time.
1.122 "Permitted Currency(ies)" shall mean Dollars or any
Alternative Currency.
1.123 "Permitted Guaranties" shall mean those guaranties executed
and delivered, or to be executed and delivered, by the Significant Domestic
Subsidiaries in favor of the Existing Senior Note Purchasers and the New Senior
Note Purchasers according to the terms of the Existing Senior Debt Documents or
the New Senior Debt Documents, as the case may be, provided that the guarantors
thereunder are also Guarantors hereunder.
1.124 "Permitted Investments" shall mean:
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(a) Investments in direct obligations of, or obligations
guarantied by, the United States of America or any agency of the
United States of America the obligations of which agency carry the
full faith and credit of the United States of America, provided that
such obligations mature within one (1) year from the date of
acquisition thereof;
(b) Investments in any obligation of any state or
municipality thereof that at the time of acquisition thereof have an
assigned rating of "A" or higher by Standard & Poor's Ratings Group
(or an equivalent or higher rating by another credit rating agency of
recognized national standing in the United States of America),
provided that such obligations mature within one (1) year from the
date of acquisition thereof;
(c) Investments in negotiable certificates of deposit
issued by commercial banks organized under the laws of the United
States of America or any state thereof, having capital, surplus and
undivided profits aggregating at least Five Hundred Million Dollars
($500,000,000) and the long-term unsecured debt obligations of which
are rated "A" or higher by Standard & Poor's Ratings Group (or an
equivalent or higher rating by another credit rating agency of
recognized national standing in the United States of America),
provided that such certificates of deposit mature within one (1) year
from the date of acquisition thereof;
(d) Investments in corporate debt obligations of
corporations organized under the laws of the United States
of America or any state thereof that at the time of acquisition
thereof have an assigned rating of "A" or higher by Standard & Poor's
Rating Group (or an equivalent or higher rating by another credit
rating agency of recognized national standing in the United States of
America); and
(e) Investments in preferred stock of corporations
organized under the laws of the United States of America or any state
thereof that have an assigned rating of "A" or higher by Standard &
Poor's Ratings Group (or an equivalent or higher rating by another
credit rating agency of recognized national standing in the United
States of America).
1.125 "Permitted Liens" shall mean, with respect to any Person:
(a) any Liens granted under or established by this
Agreement or the other Loan Documents;
(b) Liens for taxes not yet due and payable or which are
being contested in good faith by appropriate proceedings diligently
pursued, provided that such provision
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for the payment of all such taxes known to such Person has been made on
the books of such Person as may be required by GAAP;
(c) mechanics', materialmen's, banker's, carriers',
warehousemen's and similar Liens arising in the ordinary course of
business and securing obligations of such Person that are not overdue
for a period of more than 60 days or are being contested in good faith
by appropriate proceedings diligently pursued, provided that in the
case of any such contest (i) any proceedings commenced for the
enforcement of such liens and encumbrances shall have been duly
suspended; and (ii) such provision for the payment of such liens and
encumbrances has been made on the books of such Person as may be
required by GAAP;
(d) Liens arising in connection with worker's
compensation, unemployment insurance, old age pensions (subject to the
applicable provisions of this Agreement) and social security benefits
which are not overdue or are being contested in good faith by
appropriate proceedings diligently pursued, provided that in the case
of any such contest (i) any proceedings commenced for the enforcement
of such Liens shall have been duly suspended; and (ii) such provision
for the payment of such Liens has been made on the books of such
Person as may be required by GAAP;
(e) (i) Liens incurred in the ordinary course of business to
secure the performance of statutory obligations arising in connection
with progress payments or advance payments due under contracts with the
United States or any foreign government or any agency thereof entered
into in the ordinary course of business and (ii) liens incurred or
deposits made in the ordinary course of business to secure the
performance of statutory obligations, bids, leases, fee and expense
arrangements with trustees and fiscal agents and other similar
obligations (exclusive of obligations incurred in connection with the
borrowing of money, any lease-purchase arrangements or the payment of
the deferred purchase price of property), provided that full provision
for the payment of all such obligations set forth in clauses (i) and
(ii) has been made on the books of such Person as may be required by
GAAP;
(f) Liens in the nature of any minor imperfections of
title, including but not limited to easements, covenants, rights-of-way
or other similar restrictions, which, either individually or in the
aggregate would not (i) materially adversely affect the present or
future use of the property to which they relate, or (ii) have a
material adverse effect on the sale or lease of such property, or (iii)
render title thereto unmarketable;
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(g) Liens (i) arising from judicial attachments and
judgments, (ii) securing appeal bonds or supersedeas bonds, and (iii)
arising in connection with court proceedings (including, without
limitation, surety bonds and letters of credit or any other instrument
serving a similar purpose), provided that (1) the execution or other
enforcement of such Liens is effectively stayed, (2) the claims
secured thereby are being contested in good faith and by appropriate
proceedings, (3) adequate book reserves in accordance with GAAP shall
have been established and maintained and shall exist with respect
thereto, (4) such Liens do not in the aggregate detract from the value
of such property and (5) the title of the Company or a Subsidiary, as
the case may be, to, and its right to use, such property, is not
materially adversely affected thereby; and
(h) those Liens of the Company or its Subsidiaries
identified in Schedule 9.6 hereto.
1.126 "Permitted Merger(s)" shall mean any merger of any
Subsidiary (including any of the Permitted Borrowers) into Company or another
Permitted Borrower or the merger of any Subsidiary (other than a Permitted
Borrower) into any 100% Subsidiary which, in each case, satisfies and/or is
conducted in accordance with the following requirements:
(a) not less than thirty (30) nor more than ninety
(90) days prior to the commencement of such proposed merger,
Company provides written notice thereof to Agent (with
drafts of all material documents pertaining to such proposed
merger to be furnished to Agent not less than twenty (20)
days prior to such proposed merger);
(b) immediately following and as the direct result
of any such merger, the surviving or successor entity has
succeeded by operation of applicable law (as confirmed by an
opinion(s) of counsel in form and substance satisfactory to
the Majority Banks) to all of the obligations of the
non-surviving entity under this Agreement and the other Loan
Documents, and to all of the property rights of such
non-surviving entity subject to the applicable Loan
Documents and, if the shares of stock of the non-surviving
entity have been pledged to the Collateral Agent on behalf
of the Lenders in accordance with this Agreement, the shares
of stock of the surviving or successor entity are, or
concurrently with such merger, will be similarly pledged,
and such steps have been taken as necessary under applicable
law to perfect such pledge;
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(c) concurrently with such proposed merger, the
surviving entity involved in such merger shall execute or
cause to be executed, and provide or cause to be provided
to Agent for the Banks (or the Collateral Agent for the
Lenders, if applicable), any Loan Documents required
hereunder and such other documents and instruments
(including without limitation Collateral Documents,
opinions of counsel, amendments, acknowledgments and
consents) as reasonably requested by the Majority Banks;
and
(d) both immediately before and immediately after
such merger, no Default or Event of Default (whether or not
related to such restructuring), has occurred and is
continuing.
1.127 "Permitted Transfer(s)" shall mean:
(a) any sale, assignment, transfer or other disposition of
inventory or worn-out or obsolete machinery, equipment or other such personal
property in the ordinary course of business; and
(b) any sale, lease, assignment, transfer or other disposition
of real estate or tangible personal property having a net book value, determined
in accordance with GAAP, at the time of disposition thereof, aggregating (with
all other such dispositions during the period commencing on the date of this
Agreement and ending on the Revolving Credit Maturity Date), an amount not to
exceed fifteen percent (15%) of the Company's Consolidated Tangible Net Worth
determined as of the applicable date of disposition, provided that, immediately
before and after each such disposition (giving effect thereto), no Default or
Event of Default has occurred and is continuing.
1.128 "Person" shall mean an individual, corporation,
partnership, trust, incorporated or unincorporated organization, joint venture,
joint stock company, or a government or any agency or political subdivision
thereof or other entity of any kind.
1.129 "Prime Rate" shall mean the per annum interest rate
established by Agent as its prime rate for its borrowers as such rate may vary
from time to time, which rate is not necessarily the lowest rate on loans made
by Agent at any such time.
1.130 "Prime-based Advance" shall mean an Advance (including a
Swing Line Advance) which bears interest at the Prime- based Rate.
1.131 "Prime-based Rate" shall mean that rate of interest which
is the greater of (i) the Prime Rate or (ii) the Alternate Base Rate.
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1.132 "Prohibited Transaction" shall mean any transaction
involving a Pension Plan which constitutes a non-exempt "prohibited
transaction" under Section 406 of ERISA or Section 4975 of the Internal Revenue
Code.
1.133 "Quoted Rate" shall mean the rate of interest per annum
offered by the Swing Line Bank in its sole discretion with respect to a Swing
Line Advance.
1.134 "Quoted Rate Advance" means any Swing Line Advance which
bears interest at the Quoted Rate.
1.135 "Quoted Rate Interest Period" shall mean an Interest Period
of up to thirty (30) days, as offered by the Swing Line Bank and accepted by
the Company or a Permitted Borrower with respect to a Quoted Rate Advance
pursuant to Section 2.5 hereof.
1.136 "Reference Banks" shall mean Comerica, [Reserved] and
[Reserved] , or such other Banks as may be agreed to constitute the "Reference
Banks" by Company, Agent and the Majority Banks.
1.137 "Refunded Swing Line Advance" is defined in Section 2.5(e)
hereof.
1.138 "Reportable Event" shall mean a "reportable event" within
the meaning of Section 4043 of ERISA and the regulations promulgated thereunder,
which is material to the Company and its Subsidiaries, taken as a whole.
1.139 "Request for Advance" shall mean a Request for Advance of
the Revolving Credit issued by Company or by a Permitted Borrower and
countersigned by the Company under Section 2.3 of this Agreement in the form
annexed hereto as Exhibit "A".
1.140 "Required Consummation Date" shall mean December 31, 1995,
or such later date as may be approved in writing by each of the Banks.
1.141 "Revolving Credit" shall mean the revolving credit loan to
be advanced to the Company and the Permitted Borrowers by the Banks pursuant to
Section 2 hereof, in an aggregate principal amount not to exceed (subject to
the terms hereof) the Revolving Credit Maximum Amount.
1.142 "Revolving Credit Aggregate Commitment" shall mean, as of
the applicable date of determination, the Revolving Credit Maximum Amount minus
the Revolving Credit Designated Unused Portion, subject to reduction or
termination pursuant to Sections 2.15 or 10.2 hereof.
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1.143 "Revolving Credit Commitment Fee" shall mean the commitment
fee payable to Agent for distribution to the Banks pursuant to Section 2.13
hereof.
1.144 "Revolving Credit Designated Unused Portion" shall mean
that portion of the Revolving Credit Aggregate Commitment, not to exceed Forty
Million Dollars ($40,000,000) in the aggregate, designated by Company as not
immediately available for borrowing hereunder in accordance with and subject to
Section 2.16 hereof.
1.145 "Revolving Credit Maturity Date" shall mean the earlier to
occur of (i) July 26, 2000, as such date may be extended from time to time
pursuant to Section 2.18 hereof, and (ii) the date on which the Revolving
Credit Maximum Amount shall be terminated pursuant to Section 2.15 or 10.2
hereof.
1.146 "Revolving Credit Maximum Amount" shall mean One Hundred
Thirty-Five Million Dollars ($135,000,000), less any reductions in the
Revolving Credit Maximum Amount under Section 2.15 or 4.9A of this Agreement.
1.147 "Revolving Credit Notes" shall mean the Notes described in
Section 2.1 hereof, made or to be made by Company or the Permitted Borrowers to
each of the Banks in the form annexed to this Agreement as Exhibit "B-1" or
"B-2", as the case may be, as such Notes may be amended, renewed, replaced or
extended from time to time.
1.148 "Shares", "share capital", "capital stock", "stock" and
words of similar import shall mean and refer to the equity capital interest
under applicable law of any Person in a corporation, howsoever such interest is
created or arises, whether such capital consists of common stock, preferred
stock or preference shares, or other stock, and whether such capital is
evidenced by a certificate, share register entry or otherwise.
1.149 "Sharon" shall mean Sharon Manufacturing Company, a
Michigan corporation.
1.150 "Special Conditions" shall mean those special terms and
conditions required to be satisfied prior to or concurrently with the
consummation of the Dyno Acquisition, as follows:
(a) the Company and its Subsidiaries shall have furnished,
executed and delivered, or caused to be furnished, executed
and delivered, to Collateral Agent, in form to be
satisfactory to Collateral Agent and the Lenders, the Local
Share Pledges, supported by (i) certified copies of such
parties' Articles of Incorporation and Bylaws or other
constitutional documents to the extent required in the
jurisdiction of incorporation, (ii) appropriate resolutions
in certified form authorizing
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same, and (iii) certificates of good standing meeting the
requirements set forth in Section 6.2 hereof;
(b) the Collateral Agent shall have received, to the extent
necessary for perfection of the security interests and
pledges under applicable law, certificates representing the
issued and outstanding capital stock of the Subsidiaries
encumbered by the Collateral Documents, transferred for
security purposes into the name of the Collateral Agent (or
its nominees), on behalf of the Lenders or the bearer or
properly endorsed or with assignments separate from
certificate for transfer and proof that each such pledge
has been duly registered or filed under applicable law, and
that appropriate financing statements, local share pledges,
nantissements, collateral and other documents covering such
Collateral have been executed and delivered by the
appropriate parties and registered, recorded or filed in
such jurisdictions as necessary to perfect the security
interests, stock pledges or other liens granted thereby;
(c) there shall have been no material adverse change in the
condition, financial or otherwise, or prospects of, Dyno and
its subsidiaries, generally, or in the condition, financial
or otherwise, or prospects of the properties, business,
results or operations of Dyno and its subsidiaries to be
acquired by the Company and its subsidiaries pursuant to the
Dyno Acquisition Agreement (taken as a whole) from that
existing as of the date of this Agreement (as determined in
reference to the financial statements of Dyno covering
fiscal years 1993 and 1994, as previously delivered by the
Company to the Banks); nor shall any omission,
inconsistency, inaccuracy, or any change in presentation or
accounting standards which renders such financial statements
materially misleading have been determined by Agent or the
Majority Banks to exist;
(d) all governmental, quasi-governmental, agency, regulatory or
similar licenses, authorizations, exemptions,
qualifications, consents and approvals necessary or
appropriate under any laws applicable to Company or any of
its Subsidiaries, or Dyno or any of its subsidiaries for or
in connection with the Dyno Acquisition and all necessary
or appropriate non-governmental and other third-party
approvals which, in each case, are material to such
acquisition shall have been obtained, and all necessary or
appropriate declarations, registrations or other filings
with any court, governmental or regulatory authority,
securities exchange or any other person have been made, and
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evidence thereof satisfactory in form and substance to Agent
and the Majority Banks shall have been delivered, or cause
to be delivered, by Company to Agent;
(e) the New Senior Notes shall have been executed and delivered
by the Company to and accepted by the New Senior Note
Purchasers, the funding of the New Senior Debt shall have
occurred, all New Senior Debt Documents shall have been
executed and delivered in form and substance satisfactory
to the Banks and Agent; and
(f) the Company shall have delivered or caused to be delivered
to Agent (as evidenced by Agent's written confirmation
thereof) updated schedule(s) of the Permitted Liens, and
the matters shown on such updated schedule(s) do not differ
materially adversely from the matters disclosed by Company
on Schedule 9.6, hereto (as evidenced by Agent's written
confirmation thereof), or have been approved by the
Majority Banks, in their sole discretion (upon which event
Schedule 9.6 hereto shall be deemed amended to include such
additional matters).
1.151 "Special Purpose Letter(s) of Credit" shall mean any letter
of credit which is issued for the purpose of supporting industrial development
revenue bonds or other obligations of the Company or an Account Party for
borrowed money.
1.152 "Significant Subsidiary(ies)" shall mean, as of any date of
determination, any Subsidiary which is or becomes a Permitted Borrower or a
Guarantor or which has total assets in excess of Ten Million Dollars
($10,000,000) (or the Alternative Currency equivalent thereof), determined by
Agent as of the end of the most recent fiscal quarter of the Company.
1.153 "Significant Domestic Subsidiaries" shall mean those
Domestic Subsidiaries identified on Schedule 7.6 hereto, and any Domestic
Subsidiaries which become Significant Subsidiaries subsequent to the date
hereof.
1.154 "Significant Foreign Subsidiaries" shall mean those Foreign
Subsidiaries identified on Schedule 7.6 hereto, and any Foreign Subsidiaries
which become Significant Subsidiaries subsequent to the date hereof.
1.155 "Single Employer Plan" shall mean any Pension Plan which
does not constitute a Multiemployer Plan.
1.156 "Sublimit" shall mean the maximum aggregate amount of Swing
Line Advances, Letters of Credit and of Advances of the Revolving Credit and
Term Loans available at any time to each of
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the Permitted Borrowers hereunder, as set forth on Exhibit "D" hereto.
1.157 "Subordinated Debt" shall mean any unsecured Debt
subordinated to the prior payment and discharge in full of the Indebtedness, on
written terms and conditions approved by and acceptable to each of the Banks,
in their sole discretion.
1.158 "Subsidiary(ies)" shall mean any other corporation,
association, joint stock company, or business trust of which more than fifty
percent (50%) of the outstanding voting stock is owned either directly or
indirectly by Company or one or more of its Subsidiaries or by Company and one
or more of its Subsidiaries, or the management of which is otherwise
controlled, directly, or indirectly through one or more intermediaries, or
both, by Company and/or its Subsidiaries. "100% Subsidiary(ies)" shall mean any
of the Company's Subsidiaries whose stock (other than directors' or qualifying
shares to the extent required under applicable law) is owned 100% by any other
100% Subsidiary and/or the Company.
1.159 "Swing Line Advance" shall mean an Advance made by Swing
Line Bank to Company or a Permitted Borrower pursuant to Section 2.5 hereof.
1.160 "Swing Line Bank" shall mean Comerica Bank, in its capacity
as lender under Section 2.5 of this Agreement, and its successors and assigns.
1.161 "Swing Line Maximum Amount" shall mean Five Million Dollars
($5,000,000).
1.162 "Swing Line Note(s)" shall mean the swing line notes
described in Section 2.5 hereof, made or to be made by Company or the Permitted
Borrowers to the Swing Line Bank in the form annexed hereto as Exhibit "E-1" or
"E-2", as the case may be, as such Notes may be amended or supplemented from
time to time, and any notes issued in substitution, replacement or renewal
thereof from time to time.
1.163 "Term Loans" shall mean the term loans to be advanced by
the Banks to the Company or any of the Permitted Borrowers pursuant to Section
4.1 hereof, in an aggregate amount not to exceed the Term Loan Aggregate
Commitment, and "Term Loan" shall mean any specified Term Loan funded pursuant
thereto.
1.164 "Term Loan Aggregate Commitment" shall mean Seventy Million
Dollars ($70,000,000) as reduced from time to time pursuant to Section 4.9A
hereof by the Dollar Amount or the Current Dollar Equivalent, as the case may
be, of each Term Loan funded from time to time hereunder as of the date of the
funding of each such Term Loan.
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1.165 "Term Loan Funding Period" shall mean (a) with respect to
the Japanese Term Loan, a period commencing on the date hereof and ending
ninety (90) days following the date of this Agreement and (b) with respect to
each of the other Term Loans, a period commencing thirty (30) days following
the date hereof, and ending on July 26, 1998.
1.166 "Term Loan Maturity Date" shall mean a maturity date for a
Term Loan selected by the Company or the applicable Permitted Borrower pursuant
to Section 4.9A hereof, not less than two years from the date of funding of
such Term Loan and not more than seven years from the date of this Agreement;
provided, however, that the Japanese Term Loan shall have a maturity date three
years from the date of funding of such loan.
1.167 "Term Loan Permitted Amortization Schedule" shall mean the
amortization schedule selected by Company or the applicable Permitted Borrower
for a specified Term Loan based on equal annual installments of principal
sufficient to pay and discharge the full initial amount of the Term Loan over
the stated term of such loan (without regard to any principal reductions
resulting from Excess Cash Flow), commencing on the first anniversary date of
the funding of such loan and continuing on each anniversary date thereof to and
including the applicable Term Loan Maturity Date; provided however that Company
or the applicable Permitted Borrower, in establishing the applicable
amortization schedule, may elect to make payments of interest only during the
first two years of the term of any such loan (or any portion thereof), in which
event principal amortization will be required in equal annual installments
sufficient to pay and discharge in full the initial amount of the applicable
Term Loan over the remaining term of the loan commencing on the first
anniversary date of the expiration of the interest-only period and continuing on
each anniversary date thereof to and including the applicable Term Loan Maturity
Date; and provided further that for each Term Loan with a Maturity Date of two
years or less from the date of funding thereof, no principal amortization will
be required during the stated term of the loan and (if no amortization is
provided) the entire outstanding principal balance shall be due and payable on
the applicable Term Loan Maturity Date.
1.168 "Term Loan Initial Request" shall mean a request for the
initial funding of a Term Loan submitted by the Company or the applicable
Permitted Borrower to the Agent under Section 4.9A of this Agreement in the
form annexed hereto as Exhibit "I".
1.169 "Term Loan Rate Request" shall mean a request for the
refunding or conversion of any Advance of a Term Loan, other than any Advance
carried at the Fixed Rate, submitted by Company or the applicable Permitted
Borrower under Section 4.9B of this Agreement in the form annexed hereto as
Exhibit "J".
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1.170 "Term Loan Request" shall mean a Term Loan Initial Request
or a Term Loan Rate Request, or both such requests, as the context may
indicate.
1.171 "Term Notes" shall mean the term notes described in Section
4.1 hereof, made by Company or a Permitted Borrower to each of the Banks in the
form annexed to this Agreement as Exhibit "H-1" or "H-2", as the case may be,
as such notes may be amended, renewed, replaced, extended or supplemented from
time to time.
1.172 "UCC" shall mean the Uniform Commercial Code, as in effect
from time to time in the State of Michigan.
1.173 "Walbro Automotive" shall mean Walbro Automotive
Corporation, a Delaware corporation.
1.174 "Walbro Engine Management" shall mean Walbro Engine
Management Corporation, a Delaware corporation.
1.175 "Walbro Belgium" shall mean Walbro Automotive N.V., a
Belgium corporation.
1.176 "Walbro England" shall mean Walbro Automotive Limited, an
English corporation.
1.177 "Walbro France" shall mean Dynoplast S.A., a French
corporation, whose name is to be changed, concurrently with the Dyno
Acquisition, to [Reserved] .
---------------------------------
1.178 "Walbro Germany" shall mean Walbro Automotive GmbH, a
German corporation.
1.179 "Walbro Japan" shall mean Walbro Japan, Inc. [K.K.], a
Japanese corporation.
1.180 "Walbro Netherlands" shall mean Walbro Automotive N.V., a
Dutch corporation.
1.181 "Walbro Spain" shall mean Dynoplast S.A., a Spanish
corporation, whose name is to be changed, concurrently with the Dyno
Acquisition, to [Reserved] .
---------------------------------
1.182 "Whitehead" shall mean Whitehead Engineered Products, Inc.,
a Delaware Corporation.
1.183 "Yield Maintenance Payment" shall mean the yield
maintenance payment required to be paid by the Company under Section 4.12(b)
hereof in connection with any prepayment of the Term Loan following the
Company's or a Permitted Borrower's Fixed Rate Election hereunder.
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2. REVOLVING CREDIT
2.1 Commitment. Subject to the terms and conditions of this
Agreement (including without limitation Section 2.3 hereof), each Bank
severally and for itself alone agrees to make Advances of the Revolving Credit
in any one or more of the Permitted Currencies to the Company or to any of the
Permitted Borrowers from time to time on any Business Day during the period
from the effective date hereof until (but excluding) the Revolving Credit
Maturity Date in an aggregate amount, based on the Dollar Amount of any
Advances outstanding in Dollars and the Current Dollar Equivalent of any
Advances outstanding in Alternative Currencies, not to exceed at any one time
outstanding each Bank's Percentage of the Revolving Credit Aggregate
Commitment. Except as provided in Section 2.12, for purposes of this Agreement,
Advances in Alternative Currencies shall be determined, denominated and
redenominated as set forth in Section 2.11 hereof. All of the Advances of the
Revolving Credit hereunder shall be evidenced by Revolving Credit Notes made by
Company or the Permitted Borrowers to each of the Banks in the form attached
hereto as Exhibit "B-1" or "B-2", as the case may be, subject to the terms and
conditions of this Agreement. Advances of the Revolving Credit shall be subject
to the following additional conditions and limitations:
(a) A Permitted Borrower shall not be entitled to
request an Advance of the Revolving Credit hereunder until it has executed and
delivered to the Banks, as aforesaid, the Revolving Credit Notes, accompanied
by authority documents, legal opinions and other supporting documents as
required hereunder.
(b) None of the Permitted Borrowers shall be entitled to
request or maintain (or, in the case of any Eurocurrency-based Advance,
maintain beyond any applicable Interest Period then in effect) an Advance of
the Revolving Credit hereunder if it ceases to be a 100% Subsidiary of the
Company.
(c) The maximum aggregate amount of Advances of the
Revolving Credit available to each of the Permitted Borrowers at any time
hereunder, using the Current Dollar Equivalent of any Advances outstanding in
any Alternative Currency (determined and tested pursuant to and in accordance
with Section 2.14 hereof), shall not exceed the Sublimit applicable to such
Permitted Borrower.
2.2 Accrual of Interest and Maturity. The Revolving Credit Notes,
and all principal and interest outstanding thereunder, shall mature and become
due and payable in full on the Revolving Credit Maturity Date, and each Advance
of Indebtedness evidenced by the Revolving Credit Notes from time to time
outstanding hereunder shall, from and after the date of such Advance, bear
interest at its Applicable Interest Rate. The amount and date of each Advance,
its Applicable Interest Rate, its Interest Period, if any, and the
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amount and date of any repayment shall be noted on Agent's records, which
records will be rebuttably presumptive evidence thereof, absent demonstrable
error; provided, however, that any failure by the Agent to record any such
information shall not relieve the Company or the applicable Permitted Borrower
of its obligation to repay the outstanding principal amount of such Advance, all
interest accrued thereon and any amount payable with respect thereto in
accordance with the terms of this Agreement and the other Loan Documents.
2.3 Requests for and Refundings and Conversions of Advances.
Company or a Permitted Borrower may request an Advance, refund any Advance in
the same type of Advance or convert any Advance to any other type of Advance
only after delivery to Agent of a Request for Advance executed by an authorized
officer of Company or of such Permitted Borrower, subject to the following and
to the remaining provisions hereof:
(a) each such Request for Advance shall set forth the
information required on the Request for Advance form annexed hereto as
Exhibit "A", including without limitation:
(i) the proposed date of such Advance, which must be a
Business Day;
(ii) whether such Advance is a refunding or conversion
of an outstanding Advance;
(iii) whether such Advance is to be a Prime-based Advance
or a Eurocurrency-based Advance, and, except in the
case of a Prime-based Advance, the first Interest
Period applicable thereto; and
(iv) in the case of a Eurocurrency-based Advance, the
Permitted Currency in which such Advance is to be
made.
(b) each such Request for Advance shall be delivered to
Agent by 12:00 noon (Detroit time) three (3) Business Days prior to
the proposed date of Advance, except in the case of a Prime-based
Advance, for which the Request for Advance must be delivered by 12:00
noon (Detroit time) on such proposed date;
(c) the principal amount (or Dollar Amount of the
principal amount, if such Advance of the Revolving Credit is being
funded in an Alternative Currency) of such requested Advance, plus the
principal amount of all other Advances of the Revolving Credit then
outstanding hereunder, whether to Company or the Permitted Borrowers
(using the Current Dollar Equivalent of any such Advances outstanding
in any Alternative
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Currency, determined pursuant to the terms hereof as of the date of
such requested Advance), plus the aggregate principal amount of all
Swing Line Advances hereunder (using the Current Dollar Equivalent of
any such Advances outstanding in any Alternative Currency) plus the
aggregate undrawn portion of any Letters of Credit which shall be
outstanding as of the date of the requested Advance (based on the
Dollar Amount of the undrawn portion of any Letters of Credit
denominated in Dollars and the Current Dollar Equivalent of the undrawn
portion of any Letters of Credit denominated in any Alternative
Currency) and the aggregate face amount of Letters of Credit requested
but not yet issued (determined as aforesaid), plus the unreimbursed
amount of any draws under any Letters of Credit (using the Current
Dollar Equivalent thereof for any Letters of Credit denominated in any
Alternative Currency) shall not exceed the Revolving Credit Aggregate
Commitment; provided however, that, in the case of any Advance of the
Revolving Credit being applied to refund an outstanding Swing Line
Advance, the aggregate principal amount of Swing Line Advances to be
refunded shall not be included for purposes of calculating the
limitation under this Section 2.3(c);
(d) in the case of each of the Permitted Borrowers, the
principal amount of the requested Advance of the Revolving Credit
(determined as aforesaid), plus the aggregate principal amount of any
other Advances of the Revolving Credit and of any Swing Line Advances
then outstanding to such Permitted Borrower hereunder (determined as
aforesaid), plus the aggregate undrawn portion of any Letters of Credit
which shall be outstanding as of the date of the requested Advance for
the account of such Permitted Borrower hereunder and the aggregate face
amount of Letters of Credit requested but not yet issued for the
account of such Permitted Borrower hereunder (in each case determined
as aforesaid), plus the unreimbursed amount of any draws under any
Letters of Credit (using the Current Dollar Equivalent thereof for any
Letters of Credit denominated in any Alternative Currency) issued for
the account of such Permitted Borrower hereunder, plus the aggregate
principal amount of any Term Loans then outstanding to such Permitted
Borrower (determined as aforesaid) shall not exceed the applicable
Sublimit;
(e) the principal amount of such requested Advance, plus
the amount of any other outstanding Advance of the Revolving Credit to
be then combined therewith having the same Applicable Interest Rate and
Interest Period, if any, shall be (i) in the case of a Prime-based
Advance at least Three Million Dollars ($3,000,000) and (ii) in the
case of a Eurocurrency-based Advance at least Five Million Dollars
($5,000,000) or the equivalent thereof in an Alternative Currency (or a
larger integral multiple of One Million Dollars
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($1,000,000), or the equivalent thereof in the Applicable Alternative
Currency), and at any one time there shall not be in effect more than
(x) for Advances in Dollars, eight (8) Applicable Interest Rates and
Interest Periods, and (y) for Advances in any Alternative Currency
(other than eurodollars), four (4) Applicable Interest Rates and
Interest Periods for each such currency;
(f) a Request for Advance, once delivered to Agent,
shall not be revocable by Company or the Permitted Borrowers;
(g) each Request for Advance shall constitute and
include a certification by the Company and the applicable Permitted
Borrower as of the date thereof that:
(i) both before and after such Advance, the
obligations of the Company and the Permitted
Borrowers set forth in this Agreement and the
Loan Documents to which such Persons are
parties are valid, binding and enforceable
obligations of the Company and the Permitted
Borrowers, as the case may be;
(ii) all conditions to Advances of the Revolving
Credit have been satisfied, and shall remain
satisfied to the date of such Advance (both
before and after giving effect to such
Advance);
(iii) there is no Default or Event of Default in
existence, and none will exist upon the
making of such Advance (both before and after
giving effect to such Advance);
(iv) the representations and warranties contained
in this Agreement and the Loan Documents are
true and correct in all material respects and
shall be true and correct in all material
respects as of the making of such Advance
(both before and after giving effect to such
Advance); and
(v) the execution of the Request for Advance will
not violate the material terms and conditions
of any material contract, agreement or other
borrowing of Company or the Permitted
Borrowers.
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2.4 Disbursement of Advances.
(a) Upon receiving any Request for Advance from Company
or a Permitted Borrower under Section 2.3 hereof, Agent shall promptly
notify each Bank by wire, telex or telephone (confirmed by wire,
telecopy or telex) of the amount and currency of such Advance to be
made and the date such Advance is to be made by said Bank pursuant to
its Percentage of such Advance. Unless such Bank's commitment to make
Advances of the Revolving Credit hereunder shall have been suspended
or terminated in accordance with this Agreement, each Bank shall make
available the amount of its Percentage of each Advance in immediately
available funds in the currency of such Advance to Agent, as follows:
(i) for Domestic Advances, at the office of Agent
located at One Detroit Center, Detroit,
Michigan 48226, not later than 2:00 p.m.
(Detroit time) on the date of such Advance;
and
(ii) for Eurocurrency-based Advances, at the
Agent's Correspondent for the account of the
Eurocurrency Lending Office of the Agent, not
later than 12 noon (the time of the Agent's
Correspondent) on the date of such Advance.
(b) Subject to submission of an executed Request for
Advance by Company or a Permitted Borrower without exceptions noted in
the compliance certification therein, Agent shall make available to
Company or to the applicable Permitted Borrower, as the case may be,
the aggregate of the amounts so received by it from the Banks in like
funds and currencies:
(i) for Domestic Advances, not later than 4:00
p.m. (Detroit time) on the date of such
Advance by credit to an account of Company or
such Permitted Borrower maintained with Agent
or to such other account or third party as
Company or such Permitted Borrower may
reasonably direct; and
(ii) for Eurocurrency-based Advances, not later
than 4:00 p.m. (the time of the Agent's
Correspondent) on the date of such Advance,
by credit to an account of Company or such
Permitted Borrower maintained with Agent's
Correspondent or to such other account or
third party as Company or such Permitted
Borrower may reasonably direct.
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48
(c) Agent shall deliver the documents and papers
received by it for the account of each Bank to such Bank or upon its
order. Unless Agent shall have been notified by any Bank prior to the
date of any proposed Advance that such Bank does not intend to make
available to Agent such Bank's Percentage of such Advance, Agent may
assume that such Bank has made such amount available to Agent on such
date and in such currency, as aforesaid and may, in reliance upon such
assumption, make available to Company or to the applicable Permitted
Borrower, as the case may be, a corresponding amount. If such amount
is not in fact made available to Agent by such Bank, as aforesaid,
Agent shall be entitled to recover such amount on demand from such
Bank. If such Bank does not pay such amount forthwith upon Agent's
demand therefor, the Agent shall promptly notify Company and the
applicable Permitted Borrower, and Company and the applicable
Permitted Borrower, shall pay such amount to Agent. Agent shall also
be entitled to recover from such Bank or Company, as the case may be,
interest on such amount in respect of each day from the date such
amount was made available by Agent to Company or the applicable
Permitted Borrower to the date such amount is recovered by Agent, at a
rate per annum equal to:
(i) in the case of such Bank, with respect to
Domestic Advances, the Federal Funds Effective
Rate, and with respect to Eurocurrency-based
Advances, Agent's aggregate marginal cost
(including the cost of maintaining any
required reserves or deposit insurance and of
any fees, penalties, overdraft charges or
other costs or expenses incurred by Agent as a
result of such failure to deliver funds
hereunder) of carrying such amount; and
(ii) in the case of Company or any of the
Permitted Borrowers, the rate of interest
then applicable to such Advance of the
Revolving Credit.
The obligation of any Bank to make any Advance of the Revolving Credit
hereunder shall not be affected by the failure of any other Bank to
make any Advance hereunder, and no Bank shall have any liability to
the Company or any of its Subsidiaries, the Agent, any other Bank, or
any other party for another Bank's failure to make any loan or Advance
hereunder.
2.5 (a) Swing Line Advances. The Swing Line Bank shall, on
the terms and subject to the conditions hereinafter set forth (including
without limitation Section 2.5(c) hereof), make one or more advances in Dollars
or in any Alternative Currency (each such advance being a "Swing Line Advance")
to Company or any of the
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Permitted Borrowers (provided that any such Permitted Borrower has executed a
Swing Line Note and Revolving Credit Notes in compliance with this Agreement)
from time to time on any Business Day during the period from the date hereof to
(but excluding) the Revolving Credit Maturity Date in an aggregate amount, based
on the Dollar Amount of any such Advances outstanding in Dollars and the Current
Dollar Equivalent of any such Advances outstanding in Alternative Currencies,
not to exceed at any time outstanding the Swing Line Maximum Amount. All Swing
Line Advances shall be evidenced by the Swing Line Notes, under which advances,
repayments and readvances may be made, subject to the terms and conditions of
this Agreement. Each Swing Line Advance shall mature and the principal amount
thereof shall be due and payable by Company or the applicable Permitted Borrower
on the last day of the Interest Period applicable thereto, if any. In no event
whatsoever shall any outstanding Swing Line Advance be deemed to reduce, modify
or affect any Bank's commitment to make Revolving Credit Advances based upon its
Percentage.
(b) Accrual of Interest. Each Swing Line Advance shall,
from time to time after the date of such Advance, bear interest at its
Applicable Interest Rate. The amount and date of each Swing Line Advance, its
Applicable Interest Rate, its Interest Period, and the amount and date of any
repayment shall be noted on Agent's records, which records will be rebuttably
presumptive evidence thereof, absent demonstrable error; provided, however, that
any failure by the Agent to record any such information shall not relieve
Company or the applicable Permitted Borrower of its obligation to repay the
outstanding principal amount of such Advance, all interest accrued thereon and
any amount payable with respect thereto in accordance with the terms of this
Agreement and the other Loan Documents.
(c) Requests for Swing Line Advances. Company or a
Permitted Borrower may request a Swing Line Advance only after delivery to
Swing Line Bank of a Request for Swing Line Advance executed by an authorized
officer of Company or such Permitted Borrower, subject to the following and to
the remaining provisions hereof:
(i) each such Request for Swing Line Advance shall set
forth the information required on the Request for Swing Line Advance form
annexed hereto as Exhibit "F", including without limitation:
(A) the proposed date of such Swing Line Advance,
which must be a Business Day;
(B) whether such Swing Line Advance is to be a
Prime-based Advance, Eurocurrency-based Advance or a Quoted Rate
Advance; and
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(C) except in the case of a Prime-based Advance,
the duration of the Interest Period applicable thereto; and
(D) in the case of a Eurocurrency-based Advance,
the Permitted Currency in which such Advance is to be made.
(ii) the principal amount (or Dollar Amount of the
principal amount, if such Advance is being funded in an Alternative Currency) of
such requested Swing Line Advance, plus the aggregate principal amount of all
other Swing Line Advances and all Advances of the Revolving Credit then
outstanding hereunder (including any Revolving Credit Advances requested to be
made on such date) whether to Company or to any of the Permitted Borrowers
(using the Current Dollar Equivalent of any such Advances outstanding in any
Alternative Currency, determined pursuant to the terms hereof as of the date of
such requested Advance), and the aggregate undrawn portion of any Letters of
Credit which shall be outstanding as of the date of the Requested Swing Line
Advance (based on the Dollar Amount of the undrawn portion of any Letters of
Credit denominated in Dollars and the Current Dollar Equivalent of the undrawn
portion of any Letters of Credit denominated in any Alternative Currency) and
the aggregate face amount of Letters of Credit required but not yet issued
(determined as aforesaid), plus the unreimbursed amount of any draws under
Letters of Credit (using the Current Dollar Equivalent thereof for any Letters
of Credit denominated in any Alternative Currency) shall not exceed the
Revolving Credit Aggregate Commitment;
(iii) in the case of each of the Permitted Borrowers, the
principal amount of the requested Swing Line Advance to the applicable Permitted
Borrower (determined as aforesaid), plus the aggregate principal amount of any
other Swing Line Advances and all Advances of the Revolving Credit then
outstanding to such Permitted Borrower hereunder (including any Revolving Credit
Advances requested to be made on such date) determined as aforesaid, plus the
aggregate undrawn portion of any Letters of Credit which shall be outstanding as
of the date of the requested Swing Line Advance for the account of such
Permitted Borrower hereunder, plus the aggregate face amount of any Letters of
Credit requested but not yet issued for the account of such Permitted Borrower
hereunder (in each case determined as aforesaid), plus the unreimbursed amount
of any draws under any Letters of Credit (using the Current Dollar Equivalent
thereof for any Letters of Credit denominated in any Alternative Currency)
issued for the account of such Permitted Borrower plus the aggregate principal
amount of any Term Loans then outstanding to such Permitted Borrower (determined
as aforesaid) shall not exceed the applicable Sublimit;
(iv) the principal amount of such Swing Line Advance, plus
the amount of any other outstanding Advance of the Swing Line to be then
combined therewith having the same Applicable Interest Rate and Interest Period,
if any, shall be (i) in the case of a
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Prime-based Advance at least Five Hundred Thousand Dollars ($500,000) and (ii)
in the case of a Quoted Rate Advance or a Eurocurrency-based Advance at least
Five Hundred Thousand Dollars ($500,000), or the equivalent thereof in an
Alternative Currency (or a larger integral multiple of Five Hundred Thousand
Dollars ($500,000), or the equivalent thereof in the Applicable Alternative
Currency), and at any one time there shall not be in effect more than (x) for
Advances in Dollars, three (3) Applicable Interest Rates and Interest Periods,
and (y) for Advances in any Alternative Currency (other than eurodollars), one
(1) Applicable Interest Rates and Interest Periods for each such currency;
(v) each such Request for Swing Line Advance shall be
delivered to the Swing Line Bank (x) for each Advance in Dollars, by 2:00 p.m.
(Detroit time) on the proposed date of the Advance and (y) for each Advance in
any Alternative Currency, by 12:00 noon (Detroit time) two Business Days prior
to the proposed date of Advance;
(vi) each Request for Swing Line Advance, once delivered
to Swing Line Bank, shall not be revocable by Company or the Permitted
Borrowers, and shall constitute and include a certification by the Company and
the applicable Permitted Borrower as of the date thereof that:
(A) both before and after such Swing Line
Advance, the obligations of the Company and the Permitted Borrowers
set forth in this Agreement and the Loan Documents, are valid, binding
and enforceable obligations of the Company and the Permitted
Borrowers;
(B) all conditions to the making of Swing Line
Advances have been satisfied (both before and after giving effect to
such Advance);
(C) both before and after the making of such
Swing Line Advance, there is no Default or Event of Default in
existence; and
(D) both before and after such Swing Line
Advance, the representations and warranties contained in this
Agreement and the other Loan Documents are true and correct in all
material respects.
Swing Line Bank shall promptly deliver to Agent by telecopy a copy of any
Request for Swing Line Advance received hereunder.
(d) Disbursement of Swing Line Advances. Subject to
submission of an executed Request for Swing Line Advance by Company or a
Permitted Borrower without exceptions noted in the compliance certification
therein and to the other terms and conditions hereof, Swing Line Bank shall
make available to Company or the applicable
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Permitted Borrower the amount so requested, in like funds and currencies, not
later than:
(i) for Domestic Advances, not later than 4:00
p.m. (Detroit time) on the date of such Advance by credit to an account of
Company or the applicable Permitted Borrower maintained with Agent or to such
other account or third party as Company or the Permitted Borrower may
reasonably direct; and
(ii) for Eurocurrency-based advances, not later
than 4:00 p.m. (the time of the Agent's Correspondent) on the date of such
Advance, by credit to an account of Company or the Permitted Borrower
maintained with Agent's Correspondent or to such other account or third party
as Company or the applicable Permitted Borrower may reasonably direct.
Swing Line Bank shall promptly notify Agent of any Swing Line Advance by
telephone, telex or telecopier.
(e) Refunding of or Participation Interest in Swing Line
Advances.
(i) The Agent, at any time in its sole and
absolute discretion, may (or, upon the request of the Swing Line Bank, shall)
on behalf of the Company or the applicable Permitted Borrower (which hereby
irrevocably directs the Agent to act on its behalf) request each of the Banks
(including the Swing Line Bank in its capacity as a Bank) to make an Advance of
the Revolving Credit to each of Company and the Permitted Borrowers, for each
Permitted Currency in which Swing Line Advances are outstanding to such party,
in an amount (in the applicable Permitted Currency, determined in accordance
with Section 2.11(b) hereof) equal to such Bank's Percentage of the principal
amount of the aggregate Swing Line Advances outstanding in each Permitted
Currency to each such party on the date such notice is given (the "Refunded
Swing Line Advances"); provided that at any time as there shall be a Swing Line
Advance outstanding for more than thirty days, the Agent shall, on behalf of
the Company or the applicable Permitted Borrower (which hereby irrevocably
directs the Agent to act on its behalf), promptly request each Bank (including
the Swing Line Bank) to make an Advance of the Revolving Credit in an amount
equal to such Bank's Percentage of the principal amount of such outstanding
Swing Line Advance. In the case of each Refunded Swing Line Advance outstanding
in Dollars, the applicable Advance of the Revolving Credit used to refund such
Swing Line Advance shall be a Prime-based Advance. In the case of each
Refunded Swing Line Advance outstanding in any Alternative Currency, the
applicable Advance of the Revolving Credit used to refund such Swing Line
Advance shall be an Advance in the applicable Alternative Currency, with an
Interest Period of one month (or any lesser number of days selected by Agent in
consultation with the Banks). Unless any of the events described in Section
10.1(j) hereof shall have occurred (in which
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event the procedures of subparagraph (ii) of this Section 2.5(e) shall apply)
and regardless of whether the conditions precedent set forth in this Agreement
to the making of an Advance of the Revolving Credit are then satisfied, each
Bank shall make the proceeds of its Advance of the Revolving Credit available to
the Agent for the benefit of the Swing Line Bank at the office of the Agent
specified in Section 2.4(a) hereof prior to 11:00 a.m. Detroit time (for
Domestic Advances) on the Business Day next succeeding the date such notice is
given, and, in the case of any Eurocurrency-based Advance, prior to 2:00 p.m.
Detroit time on the second Business Day following the date such notice is given,
in each case in immediately available funds in the applicable Permitted
Currency. The proceeds of such Advances of the Revolving Credit shall be
immediately applied to repay the Refunded Swing Line Advances in accordance with
the provisions of Section 11.1 hereof.
(ii) If, prior to the making of an Advance of the
Revolving Credit pursuant to subparagraph (i) of this Section 2.5(e), one of
the events described in Section 10.1(j) hereof shall have occurred, each Bank
will, on the date such Advance of the Revolving Credit was to have been made,
purchase from the Swing Line Bank an undivided participating interest in each
Refunded Swing Line Advance in an amount equal to its Percentage of such
Refunded Swing Line Advance. Each Bank within the time periods specified in
section 2.5(d)(i) and (ii), above, as the case may be, shall immediately
transfer to the Agent, in immediately available funds in the applicable
Permitted Currency of such Swing Line Advance, the amount of its participation
and upon receipt thereof the Agent will deliver to such Bank a participation
certificate evidencing such participation.
(iii) Each Bank's obligation to make Advances of
the Revolving Credit and to purchase participation interests in accordance with
clauses (i) and (ii) above shall, except in respect of any Swing Line Advance
made by the Swing Line Bank following receipt by Agent from such Bank of a
written notice of the type described in Section 13.13, below, captioned "Notice
of Default" and specifically stating that such Bank does not intend to refund
or participate in future Swing Line Advances on the basis of such Default or
Event of Default, 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 Bank may have against Swing Line
Bank, the Company, the Permitted Borrowers or any other Person for any reason
whatsoever; (ii) the occurrence or continuance of any Default or Event of
Default; (iii) any adverse change in the condition (financial or otherwise) of
the Company, any Permitted Borrower or any other Person; (iv) any breach of
this Agreement by the Company, any Permitted Borrower or any other Person; (v)
any inability of the Company or the Permitted Borrowers to satisfy the
conditions precedent to borrowing set forth in this Agreement on the date upon
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which such participating interest is to be purchased or (vi) any other
circumstance, happening or event whatsoever, whether or not similar to any of
the foregoing. If any Bank does not make available to the Agent the amount
required pursuant to clause (i) or (ii) above, as the case may be, the Agent
shall be entitled to recover such amount on demand from such Bank, together
with interest thereon for each day from the date of non-payment until such
amount is paid in full at the Federal Funds Effective Rate for the first two
Business Days and at the Alternate Base Rate thereafter for Advances in Dollars
and, for Eurocurrency-based Advances, Agent's marginal cost (including the cost
of maintaining any required reserves or deposit insurance and of any fees,
penalties, overdraft charges or other costs or expenses incurred by Agent as a
result of such failure to deliver funds hereunder) of carrying such amount.
2.6 Prime-based Interest Payments. Interest on the unpaid balance
of all Prime-based Advances of the Revolving Credit and all Swing Line Advances
carried at the Prime-based Rate from time to time outstanding shall accrue from
the date of such Advance to the Revolving Credit Maturity Date (and until
paid), at a per annum interest rate equal to the Prime-based Rate, and shall be
payable in immediately available funds (a) with respect to Swing Line Advances,
monthly commencing on September 1, 1995, and on the first day of each month
thereafter, and (b) with respect to Advances of the Revolving Credit, quarterly
commencing on October 1, 1995, and on the first day of each calendar quarter
thereafter. Interest accruing at the Prime-based Rate shall be computed on the
basis of a 360 day year and assessed for the actual number of days elapsed, and
in such computation effect shall be given to any change in the interest rate
resulting from a change in the Prime-based Rate on the date of such change in
the Prime-based Rate.
2.7 Eurocurrency-based and Quoted Rate Interest Payments. Interest
on each 1 month, 2 month and 3 month Eurocurrency- based Advance of the
Revolving Credit and all Swing Line Advances carried at the Eurocurrency-based
Rate or the Quoted Rate shall accrue at its Applicable Interest Rate and shall
be payable in immediately available funds on the last day of the Interest
Period applicable thereto. Interest shall be payable on each 6 month
Eurocurrency-based Advance outstanding from time to time, at intervals of 3
months after the first day of the applicable Interest Period, and shall also be
payable on the last day of the Interest Period applicable thereto. Interest
accruing at the Eurocurrency-
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based Rate and the Quoted Rate shall be computed on the basis of a 360 day year
(except that any such Advances made in Sterling or any other Alternative
Currency with respect to which applicable law or market custom so requires shall
be calculated based on a 365 day year, or as otherwise required under applicable
law or market custom) and assessed for the actual number of days elapsed from
the first day of the Interest Period applicable thereto to but not including the
last day thereof. Interest due on a Eurocurrency-based Advance made in an
Alternative Currency shall be paid in such Alternative Currency.
2.8 Interest Payments on Conversions. Notwithstanding anything to
the contrary in the preceding sections, all accrued and unpaid interest on any
Advance converted pursuant to Section 2.3 hereof shall be due and payable in
full on the date such Advance is converted.
2.9 Interest on Default. In the event and so long as any Event of
Default shall exist, interest shall be payable daily on all Advances of the
Revolving Credit and all Swing Line Advances from time to time outstanding at a
per annum rate equal to the Applicable Interest Rate plus two percent (2%) for
the remainder of the then existing Interest Period, if any, and at all other
such times, with respect to Domestic Advances thereof from time to time
outstanding, at a per annum rate equal to the Prime-based Rate plus two percent
(2%), and, with respect to Eurocurrency-based Advances or Quoted Rate Advances
thereof in any Alternative Currency from time to time outstanding, (i) at a per
annum rate calculated by the Agent, whose determination shall be presumed to be
correct, absent demonstrable error, on a daily basis, equal to two percent (2%)
above the interest rate per annum at which one (1) day deposits (or, if such
amount due remains unpaid for more than three (3) Business Days, then for such
other period of time as the Agent may elect which shall in no event be longer
than six (6) months) in the relevant eurocurrency in the amount of such overdue
payment due to the Agent are offered by Agent's Eurocurrency Lending Office for
the applicable period determined as provided above, or (ii) if at any such time
such deposits are not offered by the Eurocurrency Lending Office, then at a rate
per annum equal to two percent (2%) above the rate determined by the Agent to be
its aggregate marginal cost (including the cost of maintaining any required
reserves or deposit insurance) of carrying the amount of such Eurocurrency-based
Advance or Quoted Rate Advance.
2.10 Prepayment. (a) Company or the Permitted Borrowers may prepay
all or part of the outstanding balance of any Prime- based Advance(s) under
the Revolving Credit Notes at any time, provided that the amount of any partial
prepayment shall be at least One Million Dollars ($1,000,000) and the aggregate
balance of Prime-based Advance(s) of the Revolving Credit remaining outstanding
shall be at least Three Million Dollars ($3,000,000). Company or the applicable
Permitted Borrower may prepay all or part of any Eurocurrency-based Advance
(subject to not less than three (3) Business Days' notice to Agent) only on the
last day of the Interest Period therefor, provided that the amount of any such
partial prepayment shall be at least One Million Dollars ($1,000,000), or the
equivalent thereof in an Alternative Currency, and the unpaid portion of such
Advance which is refunded or converted under Section 2.3 hereof shall be at
least Five Million
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Dollars ($5,000,000) or the equivalent thereof in an Alternative Currency.
(b) Company may prepay all or part of the outstanding
balance of any Swing Line Advance carried at the Prime- based Rate at any time,
provided that the amount of any partial prepayment shall be at least Five
Hundred Thousand Dollars ($500,000) and the aggregate balance of such Swing Line
Advances remaining outstanding shall be at least Five Hundred Thousand Dollars
($500,000). Company may prepay all or part of any Swing Line Advances carried at
the Eurocurrency-based Rate or the Quoted Rate (subject to not less than three
(3) Business Days' notice to Swing Line Bank and Agent) only on the last day of
the Interest Period therefor, provided that the amount of any such partial
payment shall be at least Five Hundred Thousand Dollars ($500,000), or the
equivalent thereof in any Alternative Currency, and the unpaid portion of such
Advance which is refunded or converted under Section 2.5(c) hereof shall be at
least Five Hundred Thousand Dollars ($500,000), or the equivalent thereof in any
Alternative Currency.
(c) Any prepayment made in accordance with this Section
shall be without premium, penalty or prejudice to the right to reborrow under
the terms of this Agreement. Any other prepayment of all or any portion of any
Advance of the Revolving Credit or any Swing Line Advance shall be subject to
Section 12.1, hereof, but otherwise without premium, penalty or prejudice.
2.11 Determination, Denomination and Redenomination of Alternative
Currency Advances. Whenever, pursuant to any provision of this Agreement:
(a) an Advance of the Revolving Credit or a Swing Line
Advance is initially funded, as opposed to any refunding or conversion thereof,
in an Alternative Currency, the amount to be advanced hereunder will be the
equivalent in such Alternative Currency of the Dollar Amount of such Advance;
(b) an existing Advance of the Revolving Credit or a
Swing Line Advance denominated in an Alternative Currency is to be refunded, in
whole or in part, with an Advance denominated in the same Alternative Currency,
the amount of the new Advance shall be continued in the amount of the
Alternative Currency so refunded;
(c) an existing Advance of the Revolving Credit
denominated in an Alternative Currency is to be converted, in whole or in part,
to an Advance denominated in another Alternative Currency, the amount of the
new Advance shall be that amount of the Alternative Currency of the new Advance
which may be purchased, using the most favorable spot exchange rate determined
by Agent to be available to it for the sale of Dollars for such other
Alternative Currency at approximately (11:00 a.m.) (Detroit time) two (2)
Business Days prior to the last day of the Eurocurrency
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Interest Period applicable to the existing Advance, with the Dollar Amount of
the existing Advance, or portion thereof being converted; and
(d) an existing Advance of the Revolving Credit
denominated in an Alternative Currency is to be converted, in whole or in part,
to an Advance denominated in Dollars, the amount of the new Advance shall be
the Dollar Amount of the existing Advance, or portion thereof being converted
(determined as aforesaid).
2.12 Prime-based Advance in Absence of Election or Upon Default.
If, as to any outstanding Eurocurrency-based Advance of the Revolving Credit,
or any Swing Line Advance carried at the Eurocurrency-based Rate or the Quoted
Rate, Agent has not received payment on the last day of the Interest Period
applicable thereto, or does not receive a timely Request for Advance meeting
the requirements of Section 2.3 hereof with respect to the refunding or
conversion of such Advance, or, subject to Section 2.9 hereof, if on such day a
Default or an Event of Default shall have occurred and be continuing, the
principal amount thereof which is not then prepaid in the case of a
Eurocurrency-based Advance or a Quoted Rate Advance shall, upon the election of
the Majority Banks, be converted automatically to a Prime-based Advance and the
Agent shall thereafter promptly notify Company, the Permitted Borrowers and
each of the Banks of said action. If a Eurocurrency-based Advance or a Quoted
Rate Advance converted hereunder is payable in an Alternative Currency, the
Prime-based Advance shall be in an amount equal to the Dollar Amount of such
Eurocurrency-based Advance or Quoted Rate Advance at such time and the Agent
and the Banks shall use said Prime-based Advance to fund payment of the
Alternative Currency obligation, all subject to the provisions of Section 2.14.
The Company and the Permitted Borrowers, if applicable, shall reimburse the
Agent and the Banks on demand for any costs incurred by the Agent or any of the
Banks, as applicable, resulting from the conversion pursuant to this Section
2.12 of Eurocurrency-based Advances payable in an Alternative Currency to
Prime-based Advances.
2.13 Revolving Credit Commitment Fee. From the date hereof to the
Revolving Credit Maturity Date, the Company shall pay to the Agent, for
distribution to the Banks (as set forth below), a Revolving Credit Commitment
Fee equal to the sum of:
(a) the Applicable Fee Percentage per annum times the
daily average amount by which the Revolving Credit Aggregate Commitment then in
effect hereunder exceeds the Dollar Amount of the principal amount outstanding
from time to time under the Revolving Credit, plus the aggregate daily amount
of Swing Line Advances outstanding from time to time hereunder, plus the
aggregate undrawn portion of any Letters of Credit outstanding from time to
time hereunder (using the Current Dollar Equivalent of any such Letters of
Credit denominated in any Alternative Currency),
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determined, with respect to each outstanding Advance in an Alternative Currency,
as of the last day of each Interest Period and with respect to each Letter of
Credit denominated in an Alternative Currency, on the last day of each calendar
month (but otherwise computed on a daily basis); and
(b) the Applicable Fee Percentage per annum, times the
Revolving Credit Designated Unused Portion in effect under Section 2.16 hereof
during such period, calculated on a daily basis.
The Revolving Credit Commitment Fee shall be payable quarterly in arrears
commencing on October 1, 1995 (in respect of the prior calendar quarter), and
on the first day of each calendar quarter thereafter and at the Revolving
Credit Maturity Date, and shall be computed on the basis of a year of three
hundred sixty (360) days and assessed for the actual number of days elapsed.
Whenever any payment of the Revolving Credit Commitment Fee shall be due on a
day which is not a Business Day, the date for payment thereof shall be extended
to the next Business Day. Upon receipt of such payment Agent shall make prompt
payment to each Bank of its share of the Revolving Credit Commitment Fee based
upon its respective Percentage. It is expressly understood that the Revolving
Credit Commitment Fee shall not be refundable under any circumstances.
2.14 Currency Appreciation; Sublimits; Mandatory Reduction of
Indebtedness. (a) If at any time and for any reason, the aggregate principal
amount (tested in the manner set forth below) of all Advances of the Revolving
Credit hereunder to the Company and to the Permitted Borrowers made in Dollars
and the aggregate Current Dollar Equivalent of all Advances hereunder to the
Company and to the Permitted Borrowers in any Alternative Currency as of such
time, plus the aggregate principal amount of Swing Line Advances outstanding
hereunder as of such time, plus the aggregate undrawn portion of any Letters of
Credit which shall be outstanding (based on the Dollar Amount of the undrawn
portion of any Letters of Credit denominated in Dollars and the Current Dollar
Equivalent of the undrawn portion of any Letters of Credit denominated in any
Alternative Currency), plus the unreimbursed amount of any draws under any
Letters of Credit (using the Current Dollar Equivalent thereof for any Letters
of Credit denominated in any Alternative Currency) as of such time exceeds the
Revolving Credit Aggregate Commitment (as used in this subparagraph (a), the
"Excess"), the Company and the Permitted Borrowers shall:
(i) immediately (x) repay that portion of such
Indebtedness then carried as a Prime-based Advance, if any, by the Dollar
Amount of such Excess, and/or (y) reduce any pending request for an Advance in
Dollars on such day by the Dollar Amount of such Excess, and/or (z) activate
any portion of the Revolving Credit Designated Unused Portion available to be
activated under Section 2.17 hereof, if any, in compliance with said Section
2.17, to the extent of such Excess, in each case to the extent thereof; and
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(ii) on the last day of each Interest Period of any
Eurocurrency-based Advance or Quoted Rate Advance outstanding as of such time,
until the necessary reductions of Indebtedness under this Section 2.14(a) have
been fully made, repay the Indebtedness carried in such Advances and/or reduce
any requests for refunding or conversion of such Advances submitted (or to be
submitted) by the Company or the applicable Permitted Borrower in respect of
such Advances, by the Amount in Dollars or the applicable Alternative Currency,
as the case may be, of such Excess, to the extent thereof.
Compliance with this Section 2.14(a) shall be tested on a daily or other basis
satisfactory to Agent in its sole discretion, provided that, so long as no
Default or Event of Default has occurred and is continuing, at any time while
the aggregate Advances of the Revolving Credit available to be borrowed
hereunder (based on the Revolving Credit Aggregate Commitment then in effect)
equal or exceed Five Million Dollars ($5,000,000), compliance with this Section
2.14(a) shall be tested as of the last day of each calendar quarter.
Notwithstanding the foregoing, upon the occurrence and during the continuance
of any Default or Event of Default, or if any Excess remains after
recalculating said Excess based on ninety-five percent (95%) of the Current
Dollar Equivalent of any Advances or Letters of Credit denominated in
Alternative Currencies (and one hundred percent (100%) of any Advances or
Letters of Credit denominated in Dollars), Company and the Permitted Borrowers
shall be obligated immediately to reduce the foregoing Indebtedness hereunder
by an amount sufficient to eliminate such Excess.
(b) If at any time and for any reason with respect to a
Permitted Borrower the aggregate principal amount (tested in the manner set
forth below) of all Advances of the Revolving Credit, all Swing Line Advances,
the aggregate undrawn portion of any Letters of Credit, the unreimbursed amount
of any draws under any Letters of Credit and the aggregate principal amount of
any Term Loans hereunder to or for the account of such Permitted Borrower
denominated in Dollars and ninety-five percent (95%) of the aggregate Current
Dollar Equivalent of all such Advances, Letters of Credit (including
unreimbursed draws) and Term Loans hereunder to or for the account of such
Permitted Borrower in any Alternative Currency as of such time, exceeds the
Sublimit applicable to such Permitted Borrower, the applicable Permitted
Borrower shall (i) immediately repay that portion of the Indebtedness
outstanding to such Permitted Borrower then carried as a Prime-based Advance,
if any, by the Dollar Amount of such excess, and/or reduce on such day any
pending request for an Advance in Dollars submitted by such Permitted Borrower
by the Dollar Amount of such excess, to the extent thereof; and (ii) on the
last day of each Interest Period of any Eurocurrency-based Advance or Quoted
Rate Advance outstanding to such Permitted Borrower as of such time, until the
necessary reductions of Indebtedness under this Section 2.14(b) have been fully
made, repay such Indebtedness carried in such Advances and/or
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reduce any requests for refunding or conversion of such Advances submitted (or
to be submitted) by the applicable Permitted Borrower in respect of such
Advances, by the Amount in Dollars or the applicable Alternative Currency, as
the case may be, of such excess, to the extent thereof. Provided that no Default
or Event of Default has occurred and is continuing, each Permitted Borrower's
compliance with this Section 2.14(b) shall be tested as of the last day of each
calendar quarter. Upon the occurrence and during the continuance of any Default
or Event of Default, compliance with this Section 2.14(b) shall be tested on a
daily or other basis satisfactory to Agent in its sole discretion.
2.15 Optional Reduction or Termination of Revolving Credit Maximum
Amount. Provided that the Revolving Credit Designated Unused Portion then in
effect is zero (0), the Company may, upon at least twenty (20) Business Days'
prior written notice to Agent (except in the case of a request submitted
pursuant to Section 4.9A hereof, in which event only five (5) Business Days
prior written notice shall be required), permanently reduce the Revolving Credit
Maximum Amount in whole at any time, or in part from time to time, without
premium or penalty, provided that: (i) each partial reduction of the Revolving
Credit Maximum Amount shall be in an aggregate amount equal to at least Ten
Million Dollars ($10,000,000) or a larger integral multiple of One Million
Dollars ($1,000,000); (ii) each reduction shall be accompanied by the payment of
the Revolving Credit Commitment Fee, if any, accrued to the date of such
reduction; (iii) the Company shall prepay in accordance with the terms hereof
the amount, if any, by which the aggregate unpaid principal amount of Revolving
Credit Notes, plus the aggregate amount of outstanding Letters of Credit,
exceeds the amount of the Revolving Credit Maximum Amount, taking into account
the aforesaid reductions thereof, together with interest thereon to the date of
prepayment; (iv) if the termination or reduction of the Revolving Credit Maximum
Amount requires the prepayment of a Eurocurrency-based Advance, the termination
or reduction may be made only on the last Business Day of the then current
Interest Period applicable to such Eurocurrency-based Advance and (v) no
reduction shall reduce the amount of the Revolving Credit Maximum Amount to an
amount which is less than the sum of the aggregate undrawn amount of any Letters
of Credit outstanding at such time. Reductions of the Revolving Credit Maximum
Amount and any accompanying prepayments of the Revolving Credit Notes shall be
distributed by Agent to each Bank in accordance with such Bank's Percentage
thereof, and will not be available for reinstatement by or readvance to the
Company. Any reductions of the Revolving Credit Maximum Amount hereunder shall
reduce each Bank's portion thereof proportionately (based upon the applicable
Percentages), shall automatically reduce the maximum amount thereof which may be
designated as the Revolving Credit Designated Unused Portion (except in the case
of requests for reductions submitted pursuant to Section 4.9A hereof, which
shall be governed by Section 2.14 hereof) and shall be permanent and
irrevocable. Any payments made
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pursuant to this Section shall be applied first to outstanding Prime-based
Advances under the Revolving Credit, next to Swing Line Advances carried at the
Prime-based Rate, next to Eurocurrency- based Advances of the Revolving Credit,
next to Swing Line Advances carried at the Eurocurrency-based Rate and then to
Swing Line Advances carried at the Quoted Rate.
2.16 Revolving Credit Designated Unused Portion. The Company may at
any time and from time to time, upon at least five (5) Business Days' prior
written notice to the Agent, subject to any prior activations of the Revolving
Credit Designated Unused Portion which shall remain in effect for a period of
not less than one hundred eighty (180) days in accordance with Section 2.17
hereof, designate a portion of the Revolving Credit Aggregate Commitment not
exceeding Forty Million Dollars ($40,000,000) at any time in the aggregate so
designated (or such lesser amount resulting from the application of Section
2.15 hereof), as not presently available for borrowing hereunder, provided that
(i) each such designation shall be in an aggregate amount equal to at least Ten
Million Dollars ($10,000,000) or a larger One Million Dollar ($1,000,000)
integral multiple thereof; (ii) each such designation shall be accompanied by
the payment of the Revolving Credit Commitment Fee, if any, accrued to the date
of such designation; (iii) the Company shall prepay in accordance with the
terms hereof the amount, if any, by which the aggregate unpaid principal amount
of the Revolving Credit, then outstanding, plus the aggregate principal amount
of Swing Line Advances then outstanding, plus the aggregate amount of any
outstanding Letters of Credit (using the Dollar Amount of any such Advances or
Letters of Credit denominated in Dollars and the Current Dollar Equivalent of
such Advances or Letter of Credit denominated in any Alternative Currency),
exceeds the amount of the Revolving Credit Aggregate Commitment, taking into
account the aforesaid designation under this Section 2.16, together with
interest thereon to the date of prepayment; (iv) if the designation under this
Section 2.16 requires the prepayment of a Eurocurrency-based Advance or Quoted
Rate Advance, such designation may be effective only on the last Business Day
of the then current Interest Period applicable to such Advance and (v) no such
designation shall reduce the amount of the Revolving Credit Aggregate
Commitment to an amount which is less than the sum of the aggregate undrawn
amount (determined as aforesaid) of any Letters of Credit outstanding at such
time. The Revolving Credit Aggregate Commitment shall be reduced by the
aggregate amount so designated under this Section 2.16 as the Revolving Credit
Designated Unused Portion, upon the effective date of each such designation.
2.17 Activation of Designated Unused Portion. Provided that no
Default or Event of Default has occurred and is continuing, Company may, upon
not less than five (5) Business Days' prior written notice to the Agent (except
for any activation under Section 2.14(a)(i) hereof, which shall be effective
upon Agent's receipt of written notice thereof) elect to activate all or any
part of the
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Revolving Credit Designated Unused Portion, provided that on or before the
requested date for activation, Company shall pay to the Agent, for distribution
to the Banks based on their respective Percentages, an Activation Fee in the
amount of the Applicable Fee Percentage times that portion of the Revolving
Credit Designated Unused Portion thereby activated. Each activation of the
Revolving Credit Designated Unused Portion hereunder shall remain in effect (and
shall not be reduced by a subsequent designation under Section 2.16 hereof) for
a period of not less than 180 consecutive days. Upon the effectiveness of any
activation of the Revolving Credit Designated Unused Portion under this Section
2.17, the Revolving Credit Designated Unused Portion shall decrease by the
amount so activated and the Revolving Credit Aggregate Commitment shall increase
by the amount so activated.
2.18 Extension of Revolving Credit Maturity Date. Provided that no
Default or Event of Default has occurred and is continuing, Company may, by
written notice to Agent and each Bank (which notice shall be irrevocable and
which shall not be deemed effective unless actually received by Agent and each
Bank) prior to May 28th, but not before April 28th, of each year (commencing
with calendar year 1998), request that the Banks extend the then applicable
Revolving Credit Maturity Date to a date that is one year later than the
Revolving Credit Maturity Date then in effect (each such request, a "Request").
Each Bank shall, not later than forty-five (45) calendar days following the
date of its receipt of the Request, give written notice to the Agent stating
whether such Bank is willing to extend the Revolving Credit Maturity Date as
requested. If Agent has received the aforesaid written approvals of such
Request from each of the Banks, then, effective upon the date of Agent's
receipt of all such written approvals from the Banks, as aforesaid, the
Revolving Credit Maturity Date shall be so extended for an additional one year
period, the term Revolving Credit Maturity Date shall mean such extended date
and Agent shall promptly notify the Company and the Banks that such extension
has occurred. If (i) any Bank gives the Agent written notice that it is
unwilling to extend the Revolving Credit Maturity Date as requested or (ii) any
Bank fails to provide written approval to Agent of such a Request within
forty-five (45) calendar days of the date of Agent's receipt of the Request,
then (x) the Banks shall be deemed to have declined to extend the Revolving
Credit Maturity Date, (y) the then-current Revolving Credit Maturity Date shall
remain in effect (with no further right on the part of Company to request
extensions thereof under this Section 2.18) and (z) the commitments of the
Banks to make Advances of the Revolving Credit hereunder shall terminate on the
Revolving Credit Maturity Date then in effect, and Agent shall promptly notify
Company and the Banks thereof.
2.19 Application of Advances. Advances of the Revolving Credit and
Swing Line Advances shall be available, subject to the terms
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hereof, to fund working capital needs or other general corporate purposes of the
Company and the Permitted Borrowers.
3. LETTERS OF CREDIT.
3.1 Letters of Credit. Subject to the terms and conditions of this
Agreement, Agent may through its Issuing Office, at any time and from time to
time from and after the date hereof until thirty (30) days prior to the
Revolving Credit Maturity Date, upon the written request of an Account Party
accompanied by a duly executed Letter of Credit Agreement and such other
documentation related to the requested Letter of Credit as the Agent may
require, issue standby or documentary Letters of Credit for the account of such
Account Party, in an aggregate amount for all Letters of Credit issued
hereunder at any one time outstanding not to exceed the Letter of Credit
Maximum Amount. Each Letter of Credit shall be in a minimum face amount of One
Hundred Thousand Dollars ($100,000) and, other than any Special Purpose Letter
of Credit, shall have an expiration date not later than one (1) year from its
date of issuance; provided that each Letter of Credit (including any renewal
thereof, and any Special Purpose Letter of Credit) shall expire not later than
ten (10) Business Days prior to the Revolving Credit Maturity Date in effect on
the date of issuance thereof. The submission of all applications and the
issuance of each Letter of Credit hereunder shall be subject in all respects to
applicable provisions of U.S. law and regulations, including without
limitation, the Trading With the Enemy Act, Export Administration Act,
International Emergency Economic Powers Act, and the Regulations of the Office
of Foreign Assets Control of the U.S. Department of the Treasury.
3.2A Conditions to Issuance. No Letter of Credit shall be issued at
the request and for the account of any Account Party unless, as of the date of
issuance of such Letter of Credit:
(a) the face amount of the Letter of Credit requested
(based on the Dollar Amount of the undrawn portion
of any Letter of Credit denominated in Dollars and
the Current Dollar Equivalent of the undrawn portion
of any Letter of Credit denominated in any
Alternative Currency), plus the undrawn portion of
all other outstanding Letters of Credit (determined
as aforesaid), does not exceed the Letter of Credit
Maximum Amount;
(b) the face amount of the Letter of Credit requested,
plus the aggregate undrawn portion of all other
outstanding Letters of Credit (in each case
determined as aforesaid), plus the unreimbursed
amount of any draws under Letters of Credit (using
the Current Dollar Equivalent thereof for any Letters
of Credit denominated in any Alternative
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Currency), plus the aggregate principal amount of all
Advances outstanding under the Revolving Credit Notes
and the Swing Line Notes, including any Advances
requested to be made on such date (determined on the
basis of the Current Dollar Equivalent of any
Advances denominated in any Alternative Currency, and
the Dollar Amount of any Advances in Dollars), do not
exceed the then applicable Revolving Credit Aggregate
Commitment;
(c) whenever the Account Party is a Permitted Borrower,
the face amount of the Letter of Credit requested by
such Permitted Borrower, plus the aggregate undrawn
portion of all other outstanding Letters of Credit
issued for the account of such Permitted Borrower
(in each case determined as aforesaid), plus the
unreimbursed amount of any draws under Letters of
Credit (using the Current Dollar Equivalent thereof
for any Letters of Credit denominated in any
Alternative Currency) issued for the account of such
Permitted Borrower, plus the aggregate principal
amount of all Advances outstanding under the
Revolving Credit Notes and the Swingline Notes to
such Permitted Borrower, including any Advances
requested to be made on such date (in each case
determined as aforesaid), plus the aggregate
principal amount of all Term Loans outstanding
hereunder in the name of such Permitted Borrower
(determined as aforesaid) do not exceed the Sublimit
applicable to such Permitted Borrower;
(d) the obligations of Company and the Permitted
Borrowers set forth in this Agreement and the Loan
Documents are valid, binding and enforceable
obligations of Company and the valid, binding and
enforceable nature of this Agreement and the Loan
Documents has not been disputed by Company or the
Permitted Borrowers;
(e) the representations and warranties contained in this
Agreement and the Loan Documents are true in all
material respects as if made on such date, and both
immediately before and immediately after issuance of
the Letter of Credit requested, no Default or Event
of Default exists;
(f) the execution of the Letter of Credit Agreement with
respect to the Letter of Credit requested will not
violate the terms and conditions of any contract,
agreement or other borrowing of Company or the
Permitted Borrowers;
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(g) the Account Party requesting the Letter of Credit
shall have delivered to Agent at its Issuing Office,
not less than five (5) Business Days prior to the
requested date for issuance (or such shorter time as
the Agent, in its sole discretion, may permit), the
Letter of Credit Agreement related thereto, together
with such other documents and materials as may be
required pursuant to the terms thereof, and the
terms of the proposed Letter of Credit shall be
satisfactory to Agent and its Issuing Office;
(h) no order, judgment or decree of any court,
arbitrator or governmental authority shall purport
by its terms to enjoin or restrain Agent from
issuing the Letter of Credit, or any Bank from
taking an assignment of its Percentage thereof
pursuant to Section 3.6 hereof, and no law, rule,
regulation, request or directive (whether or not
having the force of law) shall prohibit or request
that Agent refrain from issuing, or any Bank refrain
from taking an assignment of its Percentage of, the
Letter of Credit requested or letters of credit
generally;
(i) there shall have been no introduction of or change
in the interpretation of any law or regulation that
would make it unlawful or unduly burdensome for the
Agent to issue the requested Letter of Credit, no
suspension of or material limitation on trading on
the New York Stock Exchange or any other national
securities exchange, no declaration of a general
banking moratorium by banking authorities in the
United States, Michigan or the respective
jurisdictions in which the Banks, the Account Party
and the beneficiary of the requested Letter of
Credit are located, and no establishment of any new
restrictions on transactions involving letters of
credit or on banks materially affecting the
extension of credit by banks; and
(j) Agent shall have received the issuance fees required
in connection with the issuance of such Letter of
Credit pursuant to Section 3.5 hereof.
Each Letter of Credit Agreement submitted to Agent pursuant hereto shall
constitute the certification by the Company and the Account Party of the
matters set forth in this Section 3.2(A) (a) through (f). The Agent shall be
entitled to rely on such certification without any duty of inquiry.
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3.2B Special Purpose Letters of Credit. Notwithstanding anything
herein to the contrary, in connection with the requested issuance of any
Special Purpose Letter of Credit, the Agent shall be entitled to impose such
additional conditions to issuance as it may in its sole discretion require.
3.3 Notice. Agent shall give notice, substantially in the form
attached as Exhibit "G", to each Bank of the issuance of each Letter of Credit,
not later than three (3) Business Days after issuance of each Letter of Credit,
specifying the amount thereof and the amount of such Bank's Percentage thereof.
3.4 Letter of Credit Fees. Company shall pay to the Agent for
distribution to the Banks in accordance with the Percentages, Letter of Credit
Fees as follows:
(a) A per annum Letter of Credit Fee with respect to the
undrawn amount of each Letter of Credit issued pursuant hereto (based on the
Dollar Amount of any Letters of Credit denominated in Dollars and the Current
Dollar Equivalent of any Letters of Credit denominated in any Alternative
Currency) in the amount of the Applicable Fee Percentage (determined with
reference to Schedule 5.1 to this Agreement), inclusive of the facing fee of
one-eighth of one percentage point (1/8%) per annum on the face amount thereof
to be retained by Agent under Section 3.5 hereof.
(b) If any change in any law or regulation or in the
interpretation thereof by any court or administrative or governmental authority
charged with the administration thereof shall either (i) impose, modify or cause
to be deemed applicable any reserve, special deposit, limitation or similar
requirement against letters of credit issued by, or assets held by, or deposits
in or for the account of, Agent or the Banks or (ii) impose on Agent or the
Banks any other condition regarding this Agreement or the Letters of Credit, and
the result of any event referred to in clause (i) or (ii) above shall be to
increase the cost or expense to Agent or the Banks of issuing or maintaining or
participating in any of the Letters of Credit (which increase in cost or expense
shall be determined by the Agent's or such Bank's reasonable allocation of the
aggregate of such cost increases and expense resulting from such events), then,
upon demand by the Agent or such Bank, as the case may be, the Company shall,
within ten days following demand for payment, pay to Agent or such Bank, as the
case may be, from time to time as specified by the Agent or such Bank,
additional amounts which shall be sufficient to compensate the Agent or such
Bank for such increased cost and expense, together with interest on each such
amount from ten days after the date demanded until payment in full thereof at
the Prime-based Rate. A certificate as to such increased cost or expense
incurred by the Agent or such Bank, as the case may be, as a result of any event
mentioned in clause (i) or (ii) above, submitted to the
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Company, shall be rebuttably presumptive evidence, absent demonstrable error, as
to the amount thereof.
(c) All payments by the Company or any Permitted
Borrower to the Agent or the Banks under this Section 3.4 shall be made in
Dollars and in immediately available funds at the Agent's Issuing Office or
such other office of the Agent as may be designated from time to time by
written notice to the Company and the Permitted Borrowers by the Agent. The
aforesaid fees shall be nonrefundable under all circumstances, shall be payable
annually in advance (or such lesser period, if applicable, for Letters of
Credit issued with stated expiration dates of less than one year) upon the
issuance of each such Letter of Credit, and shall be calculated on the basis of
a 360 day year and assessed for the actual number of days from the date of the
issuance thereof to the stated expiration thereof.
3.5 Issuance Fees. In connection with the Letters of Credit, and
in addition to the Letter of Credit Fees (including a letter of credit facing
fee of one-eighth of one percentage point (1/8%) to be retained by Agent for
its own account), the Company and the applicable Account Party shall pay, for
the sole account of the Agent, standard documentation, administration, payment
and cancellation charges assessed by Agent or its Issuing Office, at the times,
in the amounts and on the terms set forth or to be set forth from time to time
in the standard fee schedule of Agent's Issuing office in effect from time to
time.
3.6 Draws and Demands for Payment Under Letters of Credit.
(a) The Company and each applicable Account Party agrees
to pay to the Agent, on the day on which the Agent shall honor a draft or other
demand for payment presented or made under any Letter of Credit, an amount equal
to the amount paid by the Agent in respect of such draft or other demand under
such Letter of Credit and all expenses paid or incurred by the Agent relative
thereto. Unless the Company or the applicable Account Party shall have made
such payment to the Agent on such day, upon each such payment by the Agent, the
Agent shall be deemed to have disbursed to the Company or the applicable Account
Party, and the Company or the applicable Account Party shall be deemed to have
elected to substitute for its reimbursement obligation, with respect to Letters
of Credit denominated in Dollars, a Prime-based Advance and, with respect to
Letters of Credit denominated in any Alternative Currency, a Eurocurrency-based
Advance in the applicable Alternative Currency with an Interest Period of one
month (or, if unavailable, such other Interest Period as selected by Agent in
its sole discretion) in each case for the account of the Banks in an amount
equal to the amount so paid by the Agent in respect of such draft or other
demand under such Letter of Credit. Such Prime-based Advance or Eurocurrency
Advance shall be disbursed notwithstanding any failure to satisfy any conditions
for
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disbursement of any Advance set forth in Section 2 hereof and, to the extent of
the Advances so disbursed, the reimbursement obligation of the Company or the
applicable Account Party under this Section 3.6 shall be deemed satisfied.
(b) If the Agent shall honor a draft or other demand for payment
presented or made under any Letter of Credit, the Agent shall provide notice
thereof to the Company and the applicable Account Party on the date such draft
or demand is honored, and to each Bank on such date unless the Company or
applicable Account Party shall have satisfied its reimbursement obligation
under Section 3.6(a) by payment to the Agent on such date. The Agent shall
further use reasonable efforts to provide notice to the Company or applicable
Account Party prior to honoring any such draft or other demand for payment, but
such notice, or the failure to provide such notice, shall not affect the rights
or obligations of the Agent with respect to any Letter of Credit or the rights
and obligations of the parties hereto, including without limitation the
obligations of the Company or applicable Account Party under Section 3.6(a)
hereof.
(c) Upon issuance by the Agent of each Letter of Credit hereunder,
each Bank shall automatically acquire a pro rata risk participation interest in
such Letter of Credit and related Letter of Credit Payment based on its
respective Percentage. Each Bank, on the date a draft or demand under any Letter
of Credit is honored, shall make its Percentage share of the amount paid by the
Agent, and not reimbursed by the Company or applicable Account Party on such
day, available in the applicable Permitted Currency and an immediately available
funds at the principal office of the Agent for the account of the Agent. If and
to the extent such Bank shall not have made such pro rata portion available to
the Agent, such Bank, the Company and the applicable Account Party severally
agree to pay to the Agent forthwith on demand such amount together with interest
thereon, for each day from the date such amount was paid by the Agent until such
amount is so made available to the Agent at a per annum rate equal to the
interest rate applicable during such period to the related Advance disbursed
under Section 3.6(a) in respect of the reimbursement obligation of the Company
and the applicable Account Party. If such Bank shall pay such amount to the
Agent together with such interest, such amount so paid shall constitute an
Advance by such Bank disbursed in respect of the reimbursement obligation of the
Company or applicable Account Party under Section 3.6(a) for purposes of this
Agreement, effective as of the date such amount was paid by the Agent. The
failure of any Bank to make its pro rata portion of any such amount paid by the
Agent available to the Agent shall not relieve any other Bank of its obligation
to make available its pro rata portion of such amount, but no Bank shall be
responsible for failure of any other Bank to make such pro rata portion
available to the Agent.
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(d) Nothing in this Agreement shall be construed to require or
authorize any Bank to issue any Letter of Credit, it being recognized that the
Agent shall be the sole issuer of Letters of Credit under this Agreement.
3.7 Obligations Irrevocable. The obligations of Company and any
Account Party to make payments to Agent or the Banks with respect to Letter of
Credit Obligations under Section 3.6 hereof, shall be unconditional and
irrevocable and not subject to any qualification or exception whatsoever,
including, without limitation:
(a) Any lack of validity or enforceability of any Letter
of Credit or any documentation relating to any Letter of Credit or to any
transaction related in any way to such Letter of Credit (the "Letter of Credit
Documents");
(b) Any amendment, modification, waiver, consent, or any
substitution, exchange or release of or failure to perfect any interest in
collateral or security, with respect to any of the Letter of Credit Documents;
(c) The existence of any claim, setoff, defense or other
right which the Company or any Account Party may have at any time against any
beneficiary or any transferee of any Letter of Credit (or any persons or
entities for whom any such beneficiary or any such transferee may be acting),
the Agent or any Bank or any other person or entity, whether in connection with
any of the Letter of Credit Documents, the transactions contemplated herein or
therein or any unrelated transactions;
(d) Any draft or other statement or 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;
(e) Payment by the Agent to the beneficiary under any
Letter of Credit against presentation of documents which do not comply with the
terms of the Letter of Credit, including failure of any documents to bear any
reference or adequate reference to such Letter of Credit;
(f) Any failure, omission, delay or lack on the part of
the Agent or any Bank or any party to any of the Letter of Credit Documents to
enforce, assert or exercise any right, power or remedy conferred upon the
Agent, any Bank or any such party under this Agreement, any of the Loan
Documents or any of the Letter of Credit Documents, or any other acts or
omissions on the part of the Agent, any Bank or any such party; or
(g) Any other event or circumstance that would, in the
absence of this Section 3.7, result in the release or discharge by
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operation of law or otherwise of Company or any Account Party from the
performance or observance of any obligation, covenant or agreement contained in
Section 3.6.
No setoff, counterclaim, reduction or diminution of any obligation or any
defense of any kind or nature which Company or any Account Party has or may
have against the beneficiary of any Letter of Credit shall be available
hereunder to Company or any Account Party against the Agent or any Bank.
Nothing contained in this Section 3.7 shall be deemed to prevent Company or the
Account Parties, after satisfaction in full of the absolute and unconditional
obligations of Company and the Account Parties hereunder, from asserting in a
separate action any claim, defense, set off or other right which they (or any
of them) may have against Agent or any Bank.
3.8 Risk Under Letters of Credit. (a) In assigning and the
handling of Letters of Credit and any security therefor, or any documents or
instruments given in connection therewith, Agent shall have the sole right to
take or refrain from taking any and all actions under or upon the Letters of
Credit.
(b) Subject to other terms and conditions of this
Agreement, Agent shall issue the Letters of Credit and shall hold the documents
related thereto in its own name and shall make all collections thereunder and
otherwise administer the Letters of Credit in accordance with Agent's regularly
established practices and procedures and, except pursuant to Section 13.3
hereof, Agent will have no further obligation with respect thereto. In the
administration of Letters of Credit, Agent shall not be liable for any action
taken or omitted on the advice of counsel, accountants, appraisers or other
experts selected by Agent with due care and Agent may rely upon any notice,
communication, certificate or other statement from Company, any Account Party,
beneficiaries of Letters of Credit, or any other Person which Agent believes to
be authentic. Agent will, upon request, furnish the Banks with copies of Letter
of Credit Agreements, Letters of Credit and documents related thereto.
(c) In connection with the issuance and administration of
Letters of Credit and the assignments hereunder, Agent makes no representation
and shall have no responsibility with respect to (i) the obligations of Company
or any Account Party or, the validity, sufficiency or enforceability of any
document or instrument given in connection therewith, or the taking of any
action with respect to same, (ii) the financial condition of, any
representations made by, or any act or omission of Company, the applicable
Account Party or any other Person, or (iii) any failure or delay in exercising
any rights or powers possessed by Agent in its capacity as issuer of Letters of
Credit in the absence of its gross negligence or willful misconduct. Each of the
Banks expressly acknowledge that they have made and will continue to make their
own evaluations of
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Company's and the Account Parties' creditworthiness without reliance on any
representation of Agent or Agent's officers, agents and employees.
(d) If at any time Agent shall recover any part of any
unreimbursed amount for any draw or other demand for payment under a Letter of
Credit, or any interest thereon, Agent shall receive same for the pro rata
benefit of the Banks in accordance with their respective Percentage interests
therein and shall promptly deliver to each Bank its share thereof, less such
Bank's pro rata share of the costs of such recovery, including court costs and
attorney's fees. If at any time any Bank shall receive from any source
whatsoever any payment on any such unreimbursed amount or interest thereon in
excess of such Bank's Percentage share of such payment, such Bank will promptly
pay over such excess to Agent, for redistribution in accordance with this
Agreement.
3.9 Indemnification. (a) The Company and each Account Party hereby
indemnifies and agrees to hold harmless the Banks and the Agent, and their
respective officers, directors, employees and agents, from and against any and
all claims, damages, losses, liabilities, costs or expenses of any kind or
nature whatsoever which the Banks or the Agent or any such person may incur or
which may be claimed against any of them by reason of or in connection with any
Letter of Credit, and neither any Bank nor the Agent or any of their respective
officers, directors, employees or agents shall be liable or responsible for:
(i) the use which may be made of any Letter of Credit or for any acts or
omissions of any beneficiary in connection therewith; (ii) the validity,
sufficiency or genuineness of documents or of any endorsement thereon, even if
such documents should in fact prove to be in any or all respects invalid,
insufficient, fraudulent or forged; (iii) payment by the Agent to the
beneficiary under any Letter of Credit against presentation of documents which
do not comply with the terms of any Letter of Credit (unless such payment
resulted from the gross negligence or willful misconduct of the Agent),
including failure of any documents to bear any reference or adequate reference
to such Letter of Credit; (iv) 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; or (v) any other event or
circumstance whatsoever arising in connection with any Letter of Credit;
provided, however, that Company and Account Parties shall not be required to
indemnify the Banks and the Agent and such other persons, and the Banks shall
be liable to the Company and the Account Parties to the extent, but only to the
extent, of any direct, as opposed to consequential or incidental, damages
suffered by Company and the Account Parties which were caused by the Agent's
wrongful dishonor of any Letter of Credit after the presentation to it by the
beneficiary thereunder of a draft or other demand for payment and other
documentation strictly complying with the terms and conditions of such Letter
of Credit.
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(b) It is understood that in making any payment under a Letter of
Credit the Agent will rely on documents presented to it under such Letter of
Credit as to any and all matters set forth therein without further
investigation and regardless of any notice or information to the contrary. It
is further acknowledged and agreed that Company or an Account Party may have
rights against the beneficiary or others in connection with any Letter of
Credit with respect to which the Banks are alleged to be liable and it shall be
a condition of the assertion of any liability of the Banks under this Section
that Company or applicable Account Party shall contemporaneously pursue all
remedies in respect of the alleged loss against such beneficiary and any other
parties obligated or liable in connection with such Letter of Credit and any
related transactions.
3.10 Right of Reimbursement. Each Bank agrees to reimburse the
Agent on demand, pro rata in accordance with its respective Percentage, for (i)
the out-of-pocket costs and expenses of the Agent to be reimbursed by Company
or any Account Party pursuant to any Letter of Credit Agreement or any Letter
of Credit, to the extent not reimbursed by Company or Account Party and (ii)
any and all liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, fees, expenses or disbursements of any kind and nature
whatsoever which may be imposed on, incurred by or asserted against Agent (in
its capacity as issuer of any Letter of Credit) in any way relating to or
arising out of this Agreement, any Letter of Credit, any documentation or any
transaction relating thereto, or any Letter of Credit Agreement, except to the
extent that such liabilities, losses, costs or expenses were incurred by Agent
solely as a result of Agent's gross negligence or willful misconduct.
4. TERM LOANS
4.1 Commitment. Subject to the terms and conditions of this
Agreement, each Bank, severally and for itself alone, agrees from and after the
date hereof through the expiration of the Term Loan Funding Period to advance
to the Company or to any Permitted Borrower, in a single Advance for each such
loan in Dollars or any Alternative Currency (determined on the basis set forth
in Section 4.9A hereof), sums not to exceed in the aggregate for each such Bank
an amount equal to such Bank's respective Percentage of each Term Loan funded
pursuant to Section 4.9A hereof; provided, however, that the aggregate Term
Loans funded under this Agreement, determined as set forth in Section 4.9A
hereof, shall not exceed the Term Loan Aggregate Commitment. Upon the
expiration of the Term Loan Funding Period, the Banks' respective commitments
to make additional Term Loans hereunder shall expire and be of no further force
and effect. Each of the Term Loans funded under this Section 4.1 shall be
evidenced by Term Notes to be executed and delivered by Company or the
applicable Permitted Borrower to each of the Banks, substantially in the form
attached hereto as Exhibit "H-1"
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or "H-2", as applicable, with appropriate insertions acceptable to the Agent
and the Banks in form and substance, and in the face amount of each Bank's
Percentage of the applicable Term Loan to be funded by the Banks hereunder.
4.2 Repayment of Principal. Until the applicable Term Loan
Maturity Date (as selected by the Company or the applicable Permitted Borrower
hereunder), when the entire unpaid principal balance of the applicable Term
Loan and all accrued interest and other sums outstanding thereon shall be paid
in full in Dollars or the applicable Alternative Currency (subject to the terms
hereof), the principal Indebtedness evidenced by each Term Loan shall be repaid
(irrespective of and in addition to any principal payments based on Excess Cash
Flow required hereunder or any optional prepayments hereunder), in Dollars or
the Applicable Alternative Currency, as the case may be, in accordance with the
Term Loan Permitted Amortization Schedule selected by the Company or the
applicable Permitted Borrower for such Term Loan under Section 4.9A hereof.
The applicable Term Loan Maturity Date and the Term Loan Permitted Amortization
Schedule selected for such Term Loan under Section 4.9A hereof shall be set
forth in the Term Notes executed for such Term Loan. There shall be no
readvance or reborrowing of any principal reductions of the Term Loans, whether
pursuant to this Section 4.2, or consisting of optional prepayments or payments
based on Excess Cash Flow or otherwise.
4.3 Excess Cash Flow Recapture. (a) Subject to the terms and
conditions hereof, the Term Loans shall be subject to additional required
principal reductions in the amount of fifty percent (50%) of Excess Cash Flow,
to be applied pro rata to the Term Notes issued by the Company and the
Permitted Borrowers (based on the principal amounts outstanding under such
Notes at the time any such payments are made hereunder, using the Current
Dollar Equivalent of the outstanding principal balances of any Term Loans
denominated in any Alternative Currency), payable in Dollars or the applicable
Alternative Currency in respect of each calendar year (or portion thereof)
beginning with calendar year 1997 and continuing so long as this Agreement
remains in effect, on the earlier of (i) the respective dates of Company's
delivery of financial statements for such calendar years under Section 8.3(b)
hereof or (ii) May 31st of the succeeding year, as applicable, commencing on
May 31, 1998 and on each May 31st thereafter until the Term Loans have been
irrevocably paid and discharged in full.
(b) If the Applicable Interest Rate for any Term Loan
then in effect is the Fixed Rate, principal reductions based on Excess Cash
Flow otherwise required under this Section 4.3 shall be applied (in the manner
set forth above) first, against those Term Loans, if any, for which the Fixed
Rate has not been selected. To the extent Excess Cash Flow remains after such
principal reductions, such Excess Cash Flow shall be applied against the
remaining Term Loans carried at the Fixed Rate, in the manner set
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forth above and subject to the payment of a Yield Maintenance Payment in
respect of each such Term Loan so prepaid, in the amount required under Section
4.12(b); provided, however, that Company may elect, so long as no Default or
Event of Default has occurred and is continuing hereunder, to deposit such
Excess Cash Flow into a cash collateral account to be held by Agent for and on
behalf of the Banks (which may be an interest bearing account, with interest
earnings to be available to Company so long as no Default or Event of Default
has occurred and is continuing) on such terms and conditions as acceptable to
Agent and the Majority Banks, in their reasonable discretion. Subject to the
terms and conditions of the cash collateral account so maintained, such sums on
deposit therein shall be held in the cash collateral account until no Term
Loans are outstanding under this Agreement.
Principal reductions based on Excess Cash Flow shall be in addition to
scheduled principal payments under Section 3.2 hereof, as the case may be, or
any optional prepayments made prior thereto, and shall be applied against
principal installments due hereunder in the inverse order of their maturity.
4.4 Accrual of Interest. Each Advance of Indebtedness evidenced by
the Term Notes from time to time outstanding hereunder shall, from and after
the date of such Advance, bear interest at its Applicable Interest Rate. The
amount and date of each Advance, its Applicable Interest Rate, its Interest
Period, and the amount and date of any repayment shall be noted on Agent's
records, which records will be rebuttably presumptive evidence thereof, absent
demonstrable error.
4.5 Prime-based Interest Payments. Interest on the unpaid balance
of each Term Loan which is funded or carried as a Prime-based Advance from time
to time shall accrue from the date of such Advance to the Term Loan Maturity
Date applicable to such Term Loan (or until refunded, converted or paid), at a
per annum interest rate equal to the Prime-based Rate, and shall be payable in
immediately available funds quarterly commencing on the first day of the
calendar quarter immediately following the calendar quarter in which the
Advance under the applicable Term Loan is made, and continuing on the first day
of each calendar quarter thereafter until the applicable Term Loan Maturity
Date. Interest accruing at the Prime-based Rate shall be computed on the basis
of a 360-day year and assessed for the actual number of days elapsed, and in
such computation effect shall be given to any change in the interest rate
resulting from a change in the Prime-based Rate on the date of such change in
the Prime-based Rate.
4.6 Eurocurrency-based Interest Payments. Interest on the unpaid
balance of each Term Loan which is funded or carried as a 1-month, 2-month and
3-month Eurocurrency-based Advance from time to time shall accrue at its
Applicable Interest Rate and shall be payable in immediately available funds on
the last day of the
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Interest Period applicable thereto. Interest on the unpaid balance of each Term
Loan which is funded or carried as a 6-month Eurocurrency-based Advance
outstanding from time to time shall be payable in immediately available funds
at intervals of 3 months after the first day of the applicable Interest Period,
and on the last day of the applicable Interest Period. Interest accruing at the
Eurocurrency-based Rate shall be computed on the basis of a 360-day year
(except that any such Advances made in Sterling or any other Alternative
Currency with respect to which applicable law or market custom so requires
shall be calculated based on a 365 day year, or as otherwise required under
applicable law or market custom) and assessed for the actual number of days
elapsed from the first day of the Interest Period applicable thereto to, but
not including, the last day thereof. Interest due on a Eurocurrency-based
Advance made in an Alternative Currency shall be paid in such Alternative
Currency.
4.7 Interest Payments on Conversions. Notwithstanding anything to
the contrary in the preceding Sections, all accrued and unpaid interest on any
Advance of the Term Loan converted pursuant to Section 4.9B hereof shall be due
and payable in full on the date such Advance of the Term Loan is converted.
4.8 Interest on Default. Subject to Section 4.11(f) hereof with
respect to any Fixed Rate Advances, in the event and so long as any Event of
Default shall exist under any Term Note or under this Agreement, interest shall
be payable daily on all Advances evidenced by the Term Notes from time to time
outstanding at a per annum rate equal to the Applicable Interest Rate, plus two
percent (2%) for the remainder of the then existing Interest Period, if any,
and at all other such times, with respect to any Advances carried in Dollars
from time to time outstanding, at a per annum rate equal to the Prime-based
Rate plus two percent (2%), and, with respect to any Advances denominated in
any Alternative Currency from time to time outstanding under the Term Notes,
(i) at a per annum rate calculated by the Agent, whose determination shall be
presumed correct (absent demonstrable error), on a daily basis, equal to two
percent (2%) above the interest rate per annum at which one (1) day deposits
(or, if such amount due remains unpaid for more than three (3) Business Days,
then for such other period of time as the Agent may elect which shall in no
event be longer than six (6) months) in the relevant eurocurrency in the amount
of such overdue payment due to the Agent are offered by the Eurocurrency
Lending Office for the applicable period determined as provided above, or (ii)
if at any such time such deposits are not offered by the Eurocurrency Lending
Office, then at a rate per annum equal to two percent (2%) above the rate
determined by the Agent to be its aggregate marginal cost (including the cost
of maintaining any required reserves or deposit insurance) of carrying the
amount of such Eurocurrency Advance.
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4.9A Initial Requests for Funding Term Loans. Company or the
applicable Permitted Borrower may request the funding of a Term Loan only upon
delivery to the Agent of a Term Loan Initial Request executed by an authorized
officer of Company or the applicable Permitted Borrower not less than ten (10)
nor greater than thirty (30) Business Days prior to the proposed date of
funding, subject to the following conditions:
(a) Each such Term Loan Initial Request shall set forth the
information required on the form annexed hereto as Exhibit "I", including
without limitation:
(i) whether the borrower will be the Company or an
applicable Permitted Borrower (specifying such
Permitted Borrower);
(ii) the proposed date that the applicable Term Loan is
to be funded which must be a Business Day;
(iii) whether such Term Loan is to be funded in Dollars or
in an Alternative Currency, and, if in an
Alternative Currency, the applicable Alternative
Currency;
(iv) the principal amount of the Term Loan requested to
be funded, (A) which amount (except in the case of
the Japanese Term Loan) shall not be less than
Fifteen Million Dollars ($15,000,000), or the
equivalent thereof in an Alternative Currency; and
(v) subject to the terms and conditions hereof, the
proposed Term Loan Maturity Date and the Term Loan
Permitted Amortization Schedule for such Term Loan;
(b) The Dollar Amount or the Current Dollar Equivalent, as the
case may be, of the principal amount of the Term Loan requested to be funded,
determined as of the date of funding such loan, shall not exceed the lesser of
(i) the then remaining Term Loan Aggregate Commitment, reduced by the Dollar
Amount or the Current Dollar Equivalent, as the case may be, of each Term Loan
funded prior thereto (determined with respect to each Term Loan on the date of
funding thereof) and (ii) the Revolving Credit Maximum Amount as of the date of
funding thereof;
(c) Whenever the borrower under such Term Loan is a Permitted
Borrower, the Dollar Amount or the Current Dollar Equivalent (as of the date of
funding) of such Term Loan and the aggregate principal amount of any other Term
Loans outstanding to such Permitted Borrower, plus the aggregate principal
amount of the Advances of the Revolving Credit then outstanding to such
Permitted Borrower hereunder (using the current Dollar Equivalent of any such
Advances outstanding in any Alternative Currency), plus the aggregate
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principal amount of all Swing Line Advances then outstanding to such Permitted
Borrower hereunder (using the Current Dollar Equivalent of any such Advances
outstanding in any Alternative Currency), plus the aggregate undrawn portion of
any Letters of Credit which shall then be outstanding for the account of such
Permitted Borrower (based on the Dollar Amount of the undrawn portion of any
Letters of Credit denominated in Dollars and the Current Dollar Equivalent of
the undrawn portion of any Letters of Credit denominated in any Alternative
Currency) shall not exceed (in each case, as of the date of funding of such
Term Loan) the Sublimit applicable to such Permitted Borrower; and
(d) Each such Term Loan Initial Request shall be accompanied by
the Company's concurrent request for a reduction in the Revolving Credit
Maximum Amount in the Dollar Amount or the Current Dollar Equivalent, as the
case may be, of the amount of the Term Loan so requested, to be effective,
subject to the terms hereof, concurrently with the funding of such Term Loan,
and satisfying in every respect the terms and conditions of Section 2.15 hereof
(with respect to such reduction) as of the funding of such Term Loan, including
without limitation making those reductions of Indebtedness required to be made
under said Sections 2.14 and 2.15 hereof; and, if on the date of submission of
the Applicable Term Loan Initial Request, the principal amount of all Advances
of the Revolving Credit then outstanding hereunder, whether to Company or the
Permitted Borrowers (using the Current Dollar Equivalent of any such Advances
outstanding in any Alternative Currency), plus the aggregate principal amount
of all Swing Line Advances hereunder (using the Current Dollar Equivalent of
any such Advances outstanding in any Alternative Currency), plus the aggregate
undrawn portion of all Letters of Credit which shall then be outstanding (based
on the Dollar Amount of the undrawn portion of any Letters of Credit
denominated in Dollars and the Current Dollar Equivalent of the undrawn portion
or any Letters of Credit denominated in any Alternative Currency), plus the
principal amount of the Term Loan requested to be made (based on the Current
Dollar Equivalent thereof if denominated in an Alternative Currency) shall
exceed the Revolving Credit Aggregate Commitment then in effect, the Company
shall pay to Agent for distribution to the Banks based on their respective
Percentages an activation fee in the amount of the Applicable Fee Percentage
times the amount of such excess;
(e) Within three (3) Business Days of receipt from the Company or
the applicable Permitted Borrower of a Term Loan Initial Request, Agent shall
furnish, or cause to be furnished, to the Company or the applicable Permitted
Borrower the proposed forms of Term Notes which have been completed to evidence
the applicable Term Loan, incorporating the information supplied by the Company
in its Term Loan Initial Request with respect to such Term Loan, including
without limitation, the amount and currency of such Term Loan, the applicable
Term Loan Maturity Date, and the Term Loan Permitted Amortization Schedule
selected by the Company or the
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applicable Permitted Borrower, provided that neither the Agent nor any of the
Banks shall suffer any liability whatsoever in the event such Term Notes are
not delivered for execution hereunder; and
(f) Not later than the close of business five (5) days prior to
the proposed date of funding of the Term Loan covered by the Initial Request
for Term Loan Funding, Company or the applicable Permitted Borrower shall
deliver to the Agent (which shall distribute such documents to the Banks
concurrently with the funding of such Term Loan) (i) the aforesaid Term Notes,
executed and delivered in compliance with this Agreement (dated as of the
proposed date of funding of such Term Loan) accompanied by such other Loan
Documents (including without limitation Collateral Documents), corporate
authority documentation, opinions of counsel and the like as required
hereunder, upon which delivery the Term Loan Initial Request shall no longer be
revocable by the Company or the applicable Permitted Borrower and (ii) a Term
Loan Rate Request for such Term Loan submitted in accordance with Section 4.9B
hereof.
4.9B Term Loan Rate Requests; Refundings and Conversions of
Advances. Company may, until the exercise of the Fixed Rate Option, refund any
Advance of a Term Loan as an Advance denominated in the same currency with a
like Interest Period (or if denominated in Dollars, at the Prime-based Rate) or
convert any Advance of a Term Loan to an Advance denominated in the same
currency with a different Interest Period, but only after delivery to Agent of
a Term Loan Rate Request executed by an authorized officer of Company or the
applicable Permitted Borrower (with the countersignature of the Company) and
subject to the terms hereof and to the following:
(a) each such Term Loan Rate Request shall set forth the
information required on the Term Loan Rate Request form annexed hereto
as Exhibit "J" with respect to such Term Loan, including without
limitation:
(i) the Permitted Currency in which the
applicable Term Loan is denominated;
(ii) the proposed date of the refunding or
conversion of the Advance, which must be a
Business Day;
(iii) whether the Advance is a refunding or
conversion of an outstanding Advance,
provided that refundings and conversions of
Advances of any Term Loan may be made only in
the Permitted Currency in which the
applicable Term Loan was denominated on the
initial funding thereof; and
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(iv) whether such Advance is to be a Prime-based
Advance (if the applicable Term Loan is
denominated in Dollars) or a
Eurocurrency-based Advance, and, except in
the case of a Prime-based Advance, the first
Interest Period applicable thereto.
(b) each such Term Loan Rate Request shall be delivered
to Agent by 12 Noon (Detroit time) four (4) Business Days prior to the
proposed date of Advance, except in the case of a Prime-based Advance,
for which the Request for Advance must be delivered by 11 a.m. on the
proposed date of Advance;
(c) the principal amount of such Advance of a Term Loan,
plus the amount of any other advance of such Term Loan to be then
combined therewith having the same Applicable Interest Rate and
Interest Period, if any, shall be (i) in the case of a Prime-based
Advance at least Three Million Dollars ($3,000,000), or the remaining
principal balance outstanding under such Term Loan, whichever is less
and (ii) in the case of a Eurocurrency-based Advance at least Five
Million Dollars ($5,000,000) or the remaining principal balance
outstanding under such Term Loan, whichever is less (or the equivalent
thereof in the applicable Alternative Currency), or in each case a
larger integral multiple of One Million Dollars ($1,000,000);
(d) no Advance shall have an Interest Period ending
after the Term Loan Maturity Date applicable to such Term Loan, and,
notwithstanding any provision hereof to the contrary, Company or the
applicable Permitted Borrower shall be required to select Interest
Periods for sufficient portions of a Term Loan (or, to the extent
denominated in Dollars, maintain sufficient portions thereof as a
Prime-based Advance) such that the Company or the applicable Permitted
Borrower may make its required principal payments hereunder on a
timely basis and otherwise in accordance with Sections 4.2 and 4.3,
above;
(e) upon completion of the Advance there shall be no
more than two (2) Interest Periods and two (2) Applicable Interest
Rates (including the Prime-based Rate) with respect to each Term Loan;
and
(f) a Term Loan Rate Request, once delivered to Agent,
shall not be revocable by Company or the applicable Permitted
Borrower;
Each selection of an Interest Period, and the amount and date of any repayment
shall be noted on Agent's records, which records will be rebuttably presumptive
evidence thereof, absent demonstrable error.
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4.9C Term Loan Certifications. Each Term Loan Request shall
constitute and include a certification by the Company or the applicable
Permitted Borrower as of the date thereof that:
(a) both before and after the Advance so requested, the
obligations of the Company and its Subsidiaries set forth in this
Agreement and the Loan Documents to which such Persons are parties are
valid, binding and enforceable obligations of the Company, its
Subsidiaries and the Permitted Borrowers, as the case may be;
(b) all conditions to Advances of the applicable Term
Loan or Term Loans have been satisfied, and shall remain satisfied to
the date of Advance (both before and after giving effect to such
Advance);
(c) there is no Default or Event of Default in
existence, and none will exist upon the making of the applicable
Advance (both before and after giving effect to such Advance);
(d) the representations and warranties contained in this
Agreement and the Loan Documents are true and correct in all material
respect and shall be true and correct in all material respects as of
the making of the applicable Advance (both before and after giving
effect to such Advance); and
(e) the execution of the applicable Term Loan Request
will not violate the material terms and conditions of any material
contract, agreement or other borrowing of Company or any of its
Subsidiaries;
Each Term Loan Request shall be accompanied by such documents, instruments and
other materials required hereunder or otherwise necessary to evidence
satisfaction of all conditions to the applicable Advance or Advances of a
specified Term Loan or Term Loans.
4.9D Failure to Refund or Convert. In the event the Company shall
fail with respect to any Advance of a Term Loan (other than a Prime-based
Advance) to timely exercise its option to refund or convert such Advance in
accordance with this Section 4.9D (and such Advance has not been paid in full
on the last day of the Interest Period applicable thereto according to the
terms hereof) the principal amount of such Advance which has not been prepaid
shall:
(a) in the case of any Advance denominated in Dollars,
be automatically converted to a Prime-based Advance; and
(b) in the case of any Advance denominated in an
Alternative Currency, the next Interest Period shall be fixed by the
Agent for the same period as the Interest Period then
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in effect for such Advance, or, if applicable, the applicable Term
Loan Maturity Date, whichever is the shorter period, provided that
Company or the applicable Permitted Borrower will indemnify Agent and
each of the Banks against any loss or expense incurred by them (or any
of them) pursuant to Section 12.8 hereof.
4.9E Limited Availability. Notwithstanding the selection of an
Interest Period under Section 4.9B hereof for an Advance of a Term Loan
hereunder, if prior to the last day of any Interest Period, Agent or the Banks
(after consultation with Agent) shall determine that deposits of the applicable
Alternative Currency will not be available to Agent or the Banks in the amounts
and for the term(s) necessary to carry the outstanding principal Indebtedness
of the Advance subject to such Interest Period for the next applicable Interest
Period, then Agent shall so notify Company or the applicable Permitted Borrower
and, subject to the terms hereof, Company or the applicable Permitted Borrower
shall immediately select another Interest Period to be applicable as the next
Interest Period.
4.9F Unavailability. If, prior to the last day of any Interest
Period in respect of an Advance of a Term Loan hereunder, Agent or the Banks
(after consultation with Agent) shall determine that by reason of circumstances
affecting the foreign exchange and interbank markets, generally, or for any of
the reasons set forth in Sections 12.3 or 12.4 hereof, deposits of the
applicable Alternative Currency will not be available to Agent and the Banks as
of the last day of an applicable Interest Period in the amounts necessary to
carry the outstanding principal of the Advances subject to such ending Interest
Period in such Alternative Currency for any Interest Period, Agent shall notify
the Company or the applicable Permitted Borrower and such Advances shall then
be automatically converted to and carried in Dollars, in the Current Dollar
Equivalent of the Indebtedness then outstanding, and shall bear interest at the
Prime-based Rate, until the first day of the next Interest Period, if any,
selected pursuant to Section 4.9G hereof.
4.9G Reconversion to Applicable Alternative Currency and
Eurocurrency-based Rate on Re-availability. In the event that, after a
conversion of Indebtedness to Dollars pursuant to Section 4.9F hereof, Agent
determines that deposits of the applicable Alternative Currency are again
available to Agent and the Banks in the amounts necessary to carry the
principal Indebtedness under the applicable Term Loan in such Alternative
Currency for any Interest Period, Agent shall notify Company of the Interest
Period(s) for which such deposits in such Alternative Currency are available
and Company or the applicable Permitted Borrower shall immediately select the
next Interest Period from among such available Interest Periods, in accordance
with Section 4.9B hereof, and the Indebtedness previously converted from such
Alternative Currency to
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Dollars under Section 4.9F hereof shall be reconverted to such Alternative
Currency (in the amount of the Current Dollar Equivalent of such Indebtedness),
all in accordance with and subject to Section 4.9H hereof, below.
4.9H Repayment on Reconversion. In the event that the currency in
which any Term Loan is being carried is required to be changed from Dollars to
an applicable Alternative Currency under Section 4.9G hereof, as aforesaid, and
if the Current Dollar Equivalent of the principal amount of the Indebtedness
under the applicable Term Loan outstanding upon such reconversion shall exceed
the applicable Alternative Currency Principal Limit determined for such Term
Loan, then concurrently with such reconversion, Company shall pay to Agent in
immediately available funds, for the ratable benefit of the Banks, an amount in
such Alternative Currency sufficient to reduce the then outstanding principal
amount of such Term Loan to an amount not greater than the amount of applicable
Alternative Currency Principal Limit.
4.9I Interest Payments on Conversions and Reconversions.
Notwithstanding anything to the contrary in the preceding Sections, all accrued
and unpaid interest on any Indebtedness converted or reconverted pursuant to
the foregoing Sections or otherwise, shall be due and payable in full on the
date of such conversion or reconversion.
4.10 Disbursement of Advances.
(a) Upon receiving a Term Loan Request from Company or a
Permitted Borrower in compliance with Sections 4.9A and/or 4.9B
hereof, together with such other documents and instruments required
thereunder, Agent shall promptly notify each Bank by wire, telex or by
telephone (confirmed by wire, telecopy or telex) of the amount of such
Advance to be made and the date such Advance is to be made by said
Bank pursuant to its Percentage of the Advance. Unless such Bank's
commitment to make Advances hereunder shall have been suspended or
terminated in accordance with this Agreement, each Bank shall make
available to Agent the amount of its Percentage of the Advance in
immediately available funds in the currency of such Advance, as
follows:
(i) for Prime-based Advances, at the office of
Agent located at One Detroit Center, 500
Woodward Avenue, Detroit, Michigan 48226, not
later than 2:00 p.m. (Detroit time) on the
date of such Advance; and
(ii) for Eurocurrency-based Advances or other
Advances in any Alternative Currency, at the
Agent's Correspondent for the account of the
Eurocurrency Lending Office of the Agent, not
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later than 12 Noon (the time of the Agent's
Correspondent) on the date of such Advance.
(b) Subject to receipt of the Term Loan Requests, as
applicable, and such other documents and instruments referred to in
subparagraph 4.10(a) hereof (without exceptions noted in the
compliance certifications therein), Agent shall make available to
Company or the applicable Permitted Borrower, as the case may be, the
aggregate of the amounts so received by it from the Banks in like
funds and currencies:
(i) for Prime-based Advances, not later
than 4:00 p.m. (Detroit time) on the
date of such Advance by deposit to
an account of the Company or the
applicable Permitted Borrower
maintained with Agent, or to such
other account or third party as
Company or the applicable Permitted
Borrower may reasonably direct;
(ii) for Eurocurrency-based Advances or
other Advances denominated in any
Alternative Currency, not later than
4:00 p.m. (the time of the Agent's
Correspondent) on the date of such
Advance, by deposit to an account of
the Company or the applicable
Permitted Borrower, as the case may
be, maintained with Agent's
Correspondent, or to such other
account or third party as Company or
the applicable Permitted Borrower,
as the case may be, may reasonably
direct.
(c) Agent shall deliver the documents and papers
received by it for the account of each Bank to such Bank or upon its
order. Unless Agent shall have been notified by any Bank prior to the
date of any proposed Advance that such Bank does not intend to make
available to Agent such Bank's Percentage of the Advance, Agent may
assume that such Bank has made such amount available to Agent on such
date, as aforesaid and may, in reliance upon such assumption, make
available to Company or the applicable Permitted Borrower a
corresponding amount. If such amount is not in fact made available to
Agent by such Bank, as aforesaid, Agent shall be entitled to recover
such amount on demand from such Bank. If such Bank does not pay such
amount forthwith upon Agent's demand therefor, the Agent shall
promptly notify Company and Company or the applicable Permitted
Borrower shall pay such amount to Agent. Agent shall also be entitled
to recover from such Bank or Company (and the applicable Permitted
Borrower), as the case may be, interest on such amount in respect of
each day from the date such amount was made available by Agent to
Company or
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the applicable Permitted Borrower to the date such amount is recovered
by Agent, at a rate per annum equal to:
(i) in the case of such Bank, with
respect to Prime-based Advances, the
Federal Funds Effective Rate, and
with respect to Eurocurrency-based
Advances or other Advances in any
alternative currency, Agent's
aggregate marginal cost (including
the cost of maintaining any required
reserves or deposit insurance and of
any fees, penalties, overdraft
charges or other costs or expenses
incurred by Agent as a result of
such failure to deliver funds
hereunder) of carrying such amount;
and
(ii) in the case of Company, the rate of
interest then applicable to such Term
Loan.
The obligation of any Bank to make any Advance hereunder shall not be
affected by the failure of any other Bank to make any Advance
hereunder, and no Bank shall have any liability to the Company or its
Subsidiaries, the Agent, any other Bank, or any other party for
another Bank's failure to make any loan or Advance hereunder.
4.11 Fixed Rate Election. (a) The Fixed Rate Election shall set
forth the information required on the Fixed Rate Election form attached hereto
as Exhibit "K" and shall constitute Company's or the applicable Permitted
Borrower's certification that the conditions required under subparagraph (c),
below, have been satisfied and that Company or the applicable Permitted
Borrower is entitled, with respect to a specified Term Loan, to elect the Fixed
Rate hereunder;
(b) The Fixed Rate Election shall be delivered to Agent by
11:00 a.m. (Detroit time) not less than fourteen (14) nor greater than twenty
(20) Business Days prior to the proposed effective date of such election, and
once delivered to Agent by the Company or the applicable Permitted Borrower,
shall not be revocable by Company or the applicable Permitted Borrower;
(c) In order for the Fixed Rate to become effective, the
following conditions shall be satisfied by the Company or the applicable
Permitted Borrower (unless waived by the Banks) on or before the proposed
effective date of the Fixed Rate Election, and shall remain satisfied on the
actual effective date thereof:
(i) The Fixed Rate Election shall be
made only with respect to the entire
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outstanding principal balance of a
specified Term Loan, and not with
respect to any particular Advance or
portion of such Term Loan;
(ii) Except with respect to a Term Loan
carried in its entirety at the
Prime-based Rate, the proposed
effective date of the Fixed Rate
Election (and the actual effective
date thereof) shall occur only on
the last day of a single Interest
Period in which the entire principal
balance of the applicable Term Loan
(excluding any portion thereof
carried at the Prime-based Rate) is
then being carried;
(iii) All accrued interest outstanding
under the specified Term Loan as of
the effective date of the Fixed Rate
Election has been paid and
discharged in full;
(iv) Both before and after the effective
date of such election, the
obligations of Company and the
Permitted Borrowers set forth in
this Agreement are valid, binding
and enforceable obligations of such
parties; and
(v) There is no Default or Event of
Default in existence, and none will
exist upon the effective date of
such election (both before and after
giving effect to such Advance).
(d) Subject to the foregoing, the Fixed Rate Election shall
become effective (and the Fixed Rate shall become the Applicable Interest Rate
for the specified Term Loan) on the proposed effective date of the Fixed Rate
Election, as designated by the Company or the applicable Permitted Borrower
therein, whereupon Agent will notify Company and the Banks promptly of the
Fixed Rate thereby established hereunder.
(e) Once so elected, the Fixed Rate shall, subject to the
terms hereof, remain the Applicable Interest Rate for the specified Term Loan
so long as such Term Loan is outstanding hereunder.
(f) Interest on each Term Loan accruing at the Fixed Rate
shall be payable in immediately available funds quarterly commencing on the
last day of the calendar quarter in which the Fixed Rate Election shall have
been made by the Company or a Permitted Borrower hereunder, and continuing on
the last day of
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each calendar quarter thereafter until the applicable Term Loan Maturity Date
for such Term Loan, shall be computed on the basis of a 360-day year and
assessed for the actual number of days elapsed. In the event and so long as
any Event of Default shall have occurred and be continuing, interest shall be
payable daily on each Term Loan from time to time outstanding for which the
Applicable Interest Rate is the Fixed Rate at a per annum rate equal to the
Fixed Rate, plus three percent (3%).
4.12 Prepayment. (a) Company or the applicable Permitted Borrower
may prepay all or part of the outstanding balance of any Prime-based Advance(s)
of a Term Loan at any time (subject to not less than one (1) Business Day's
notice to Agent), provided that the amount of any partial prepayment by such
party shall be at least One Million Dollars ($1,000,000) and the aggregate
balance of Prime-based Advance(s) remaining outstanding on such Term Loan shall
be at least Three Million Dollars ($3,000,000). Company may prepay all or part
of any Eurocurrency-based Advance (subject to not less than three (3) Business
Days' notice to Agent) only on the last day of the Interest Period applicable
thereto, provided that the amount of any such partial prepayment by such party
shall be at least One Million Dollars ($1,000,000) (or the equivalent thereof
in the applicable Alternative Currency), and the unpaid portion of such Advance
which is refunded or converted by such party under Section 4.9B hereof shall be
at least Five Million Dollars ($5,000,000), or the equivalent thereof in any
Alternative Currency. Any prepayment made in accordance with this Section
shall be applied against principal installments due hereunder in the inverse
order of their maturities, and shall be without premium or penalty (subject to
Section 12 hereof), but there shall be no readvance or reborrowing of any
principal reductions of the applicable Term Loan (whether or not such principal
reductions constitute prepayments).
(b) Once the Fixed Rate becomes the applicable Interest Rate for a
Term Loan hereunder, at its option and upon not less than five (5) business
days prior written notice to Agent, Company or the applicable Permitted
Borrower may prepay the principal balance outstanding under such Term Loan in
whole or in part, provided that the amount of any partial prepayment by such
party shall be at least Five Million Dollars ($5,000,000) or the equivalent
thereof in the applicable Alternative Currency and the aggregate principal
balance remaining outstanding under such Term Loan shall be at least Five
Million Dollars ($5,000,000) or the equivalent thereof in any Alternative
Currency, only upon payment to the Agent, for distribution to the Banks pro
rata, of a Yield Maintenance Payment in an amount calculated by Agent to make
the Banks whole (to the extent of the interest which would have been earned by
the Banks but for the occurrence of such prepayment) on the basis of the
discounted net present values of the interest payments that would otherwise be
payable on the principal amount of the Term Loan being prepaid, after taking
into account the amount of interest which
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would be payable on each interest payment due date if the principal amount
being repaid were reinvested at the Current Market Rate (defined below).
As used herein, "Current Market Rate" shall mean a per annum interest
rate equal to one-half percentage point (.5%) above the rate reasonably
determined by Agent (based on quotations from established dealers) to be in
effect two (2) days prior to the repayment date in the secondary market for
United States Treasury Securities of a comparable amount and with a comparable
term to maturity as the principal amount being prepaid hereunder. For purposes
of computation, the discount rate for each computation will be the Current
Market Rate for the relevant principal installment.
Upon any involuntary prepayment of any Term Loan for which the applicable
Interest Rate is the Fixed Rate, whether by acceleration, or otherwise, the
Company or the applicable Permitted Borrower shall pay to Agent, for
distribution to the Banks pro rata, a Yield Maintenance Payment in an amount
equal to the Yield Maintenance Payment which would have been due and payable
hereunder if the Company or the applicable Permitted Borrower had voluntarily
elected to prepay such Term Loan (in an amount equal to such involuntary
prepayment) on such date of involuntary prepayment. Any partial prepayments
hereunder shall be applied to payments due under the Term Loan in the inverse
order of their maturities, and there shall be no readvance or reborrowing of
any such principal reductions (whether or not such principal reductions
constitute prepayments).
4.13 Purpose. Term Loans shall be available, subject to the terms
hereof, to fund working capital needs or other general corporate purposes of
the Company and the Permitted Borrowers or to renew and replace Advances of the
Revolving Credit or Swing Line Advances refinanced thereby.
5. MARGIN ADJUSTMENTS; HLT DETERMINATION; SPECIAL LIMITATION
5.1 Margin Adjustments. Adjustments to the Applicable Margin,
based on Schedule 5.1, shall be implemented as follows:
(i) Such adjustments to the Applicable Margin
shall be given prospective effect only, effective (A) as to all Prime-based
Advances outstanding hereunder, immediately upon required date of delivery of
the financial statements required to be delivered under Section 8.3(b) and
8.3(c) hereof establishing applicability of the appropriate adjustments, if
any, and (B) as to each Eurocurrency-based Advance outstanding hereunder,
effective upon the expiration of the applicable Interest Period(s), if any, in
effect on the required date of delivery of the latest of such financial
statements required to be delivered hereunder during such
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Interest Period(s), as applicable, in each case with no retroactivity or
claw-back.
(ii) With respect to Eurocurrency-based Advances
outstanding hereunder, an adjustment hereunder, after becoming effective, shall
remain in effect only through the end of the applicable Interest Period(s) for
such Eurocurrency-based Advances if any; provided, however, that upon the
delivery of quarterly financial statements demonstrating any change in the
Funded Debt Ratio, as aforesaid, or the occurrence of any other event which
under the terms hereof causes such adjustment no longer to be applicable, then
any such subsequent adjustment or no adjustment, as the case may be, shall be
effective (and said pricing shall thereby be adjusted up or down, as
applicable) with the commencement of each Interest Period following such change
or event, all in accordance with the preceding subparagraph.
5.2 HLT Determination. In the event at any time of an HLT
Determination, the Agent, the Banks and the Company shall commence negotiations
in good faith to agree upon whether and, if so, the extent to which fees,
interest rates and/or margins hereunder should be increased so as to reflect
such HLT Determination and to compensate the Banks and Agent for additional
costs, expenses and/or fees which result from or are associated with any such
HLT Determination, including without limitation any costs resulting from any
requirement that additional capital be allocated to the Indebtedness, or any
portion thereof. If Company and the Majority Banks agree that fees, interest
rates and/or margins should be increased, and agree on the amount of such
increase or increases, this Agreement may be amended to give effect to such
increase or increases as provided in Section 14.11 hereof. If Company and
Majority Banks fail to agree on whether and, if so, the extent to which fees,
interest rates and/or margins hereunder should be increased within 60 days
after notice to Company of an HLT Determination as herein provided, then (i)
the Agent shall, if requested by the Majority Banks, by written notice to the
Company terminate the commitments of the Banks to fund and/or maintain Advances
of the Revolving Credit and Swing Line Advances, and if still outstanding, any
commitment to fund Term Loans, and such commitments shall thereupon terminate,
(ii) Company shall be obligated to repay all outstanding Indebtedness at the
end of the Interest Period applicable thereto and (iii) the Company may, at its
option, on at least ten Business Days' written notice to the Agent (which shall
promptly notify the Banks thereof) prepay all Indebtedness outstanding
hereunder and under the other Loan Agreements by paying the aggregate principal
amount thereof, together, with all accrued interest thereon to the date of
prepayment; provided that, if the Company prepays any Fixed Rate Advance or
Advances carried at the Eurocurrency-based Rate, the Quoted Rate, or any
comparable rate, pursuant to this Section 5.2, Company shall compensate the
Banks for any resulting funding losses as provided in Section 12.1 hereof.
Subject to compliance by
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Company and the Permitted Borrowers with this Section 5.2, the Banks
acknowledge that an HLT Determination shall not constitute a Default or an
Event of Default hereunder.
5.3 Special Limitation. In the event, as a result of increases in
the value of any of the Alternative Currencies against the Dollar or for any
other reason, the obligation of any of the Banks to advance additional funds
hereunder (taking into account any other Indebtedness required to be aggregated
under 12 USCA 84, as amended, the regulations promulgated thereunder, or other,
similar applicable law) is determined by such Bank to exceed its then
applicable legal lending limit under 12 USCA 84, as amended, and the
regulations promulgated thereunder, or other, similar applicable laws, the
amount of additional funds which such Bank shall be obligated to advance
hereunder shall immediately be reduced to the maximum amount which such Bank
may legally advance (as determined by such Bank), the obligation of each of the
remaining Banks hereunder shall be proportionately reduced, based on the
applicable Percentages, and, to the extent necessary under such laws and
regulations (as determined by each of the Banks, with respect to the
applicability of such laws and regulations to itself), the Company shall
reduce, or cause to be reduced, complying to the extent practicable with the
remaining provisions hereof, the Indebtedness outstanding hereunder by an
amount sufficient to comply with such maximum amounts. Upon any such reduction
in the obligations of the Banks under this Section 5.3, Company shall have the
right, subject to the terms and conditions of this Agreement (but subsequent to
Company's compliance with its obligation to reduce the Indebtedness outstanding
hereunder), to add to the Banks providing financing hereunder a bank or banks
reasonably acceptable to the Agent for the purpose of restoring the shortfall
created by the reduction in such obligations of the Banks.
6. CONDITIONS. The obligations of Banks to make Advances or loans
pursuant to this Agreement are subject to the following conditions, provided
however that Sections 6.1 through 6.14 below shall only apply to the initial
Advances or loans hereunder:
6.1 Execution of Notes, this Agreement and the other Loan
Documents. The Company and the Permitted Borrowers, as applicable, shall have
executed and delivered to the Agent for the account of each Bank, the Revolving
Credit Notes, the Term Notes (if applicable) for each Term Loan then in effect,
the Swing Line Notes (solely for the account of the Swing Line Bank) and this
Agreement (including all schedules, exhibits, certificates, opinions, financial
statements and other documents to be delivered pursuant hereto) and the other
Loan Documents, and, as applicable, such Revolving Credit Notes, Term Notes,
Swing Line Notes, this Agreement and the other Loan Documents shall be in full
force and effect.
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6.2 Corporate Authority. Agent shall have received, with a
counterpart thereof for each Bank: (i) certified copies of resolutions of the
Board of Directors of the Company and each of the Permitted Borrowers
evidencing approval of this Agreement, the Notes and the other Loan Documents
to which such Person is a party and authorizing the execution and delivery
thereof and the borrowing of Advances hereunder; (ii) (A) certified copies of
the Company's and each Guarantor's articles of incorporation and bylaws or
other constitutional documents certified as true and complete as of a recent
date by the appropriate official of the jurisdiction of incorporation of each
such entity (or, if unavailable in such jurisdiction, by a responsible officer
of such entity); and (B) a certificate of good standing from the state or other
jurisdictions of the Company's incorporation, and from the applicable states of
incorporation or other jurisdictions of each of the Permitted Borrowers and the
Guarantors and from every state or other jurisdiction in which the Company,
each of the Permitted Borrowers or any of the Significant Subsidiaries is
qualified to do business, if issued by such jurisdictions, subject to the
limitations (as to qualification and authorization to do business) contained in
Section 7.1, hereof.
6.3 Company Guaranty. As security for all Indebtedness of the
Permitted Borrowers to the Banks hereunder and under the other Loan Documents,
the Company shall have furnished, executed and delivered to Agent, prior to or
concurrently with the initial borrowing hereunder, in form and substance
satisfactory to Agent and the Banks and supported by appropriate resolutions in
certified form authorizing same, the Company Guaranty.
6.4 Domestic Guaranty. As security for all Indebtedness of the
Company and the Permitted Borrowers to the Banks hereunder and under the other
Loan Documents, each of the Significant Domestic Subsidiaries shall have
furnished, executed and delivered to Agent, prior to or concurrently with the
initial borrowing hereunder, in form and substance satisfactory to Agent and
the Banks and supported by appropriate resolutions in certified form
authorizing same, the Domestic Guaranty.
6.5 Foreign Permitted Borrower Guaranty. As security for all
Indebtedness of those Permitted Borrowers which are Foreign Subsidiaries to the
Banks hereunder and under the other Loan Documents, each of the Significant
Foreign Subsidiaries shall have furnished, executed and delivered to Agent,
prior to or concurrently with the initial borrowing hereunder, in form and
substance satisfactory to Agent and the Banks and supported by appropriate
resolutions in certified form authorizing same, the Permitted Borrower
Guaranty.
6.6 Company Collateral Documents. As security for all Indebtedness
of Company to the Banks hereunder, Company shall have furnished, executed and
delivered to the Collateral Agent, or
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caused to be furnished, executed and delivered to the Collateral Agent, prior
to or concurrently with the initial borrowing hereunder, in form and substance
satisfactory to the Collateral Agent and the Banks and supported by appropriate
resolutions in certified form authorizing same, the Company Collateral
Documents. In addition, if required or advisable under applicable law to
perfect the liens granted thereby, the Collateral Agent shall have received,
concurrently with or prior to the making of Advances hereunder, proof that
appropriate financing statements, collateral and other documents covering such
Collateral have been executed and delivered by the appropriate parties and
recorded or filed in such jurisdictions and such other steps have been taken as
necessary to perfect the security interests, or other liens granted thereby.
6.7 Guarantor Collateral Documents. As security for all
Indebtedness of Company to the Banks hereunder, each of the Guarantors shall
have furnished, executed, and delivered to the Collateral Agent, or caused to
be furnished, executed and delivered to the Collateral Agent, prior to or
concurrently with the initial borrowing hereunder, in form and substance
satisfactory to Collateral Agent and the Banks and supported by appropriate
resolutions in certified form authorizing same, the Guarantor Collateral
Documents. In addition, if required or advisable under applicable law to
perfect the liens granted thereby, the Collateral Agent shall have received,
concurrently with the making of Advances hereunder proof that appropriate
financing statements, collateral and other documents covering such Collateral
have been executed and delivered by the appropriate parties and recorded or
filed in such jurisdictions and such other steps have been taken as necessary
to perfect the security interests or other liens granted thereby.
6.8 Representations and Warranties -- All Parties. The
representations and warranties made by the Company, the Permitted Borrowers,
the Significant Subsidiaries and any other party to any of the Loan Documents
under this Agreement or any of the other Loan Documents (excluding the Banks),
and the representations and warranties of any of the foregoing which are
contained in any certificate, document or financial or other statement
furnished at any time hereunder or thereunder or in connection herewith or
therewith shall have been true and correct in all material respects when made
and shall be true and correct in all material respects on and as of the date of
the making of the initial Advance hereunder.
6.9 Compliance with Certain Documents and Agreements. The Company,
the Permitted Borrowers and the Guarantors (and any of their respective
Subsidiaries or Affiliates) shall have each performed and complied with all
agreements and conditions contained in this Agreement, the other Loan
Documents, or any agreement or other document executed hereunder or thereunder
and required to be performed or complied with by each of them (as of the
applicable date) and none of such parties shall be in default in the
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performance or compliance with any of the terms or provisions hereof or
thereof.
6.10 Opinion of Counsel. The Company, the Permitted Borrowers and
the Guarantors shall have furnished Agent prior to the initial Advance under
this Agreement with signed copies for each Bank (and addressed to each of the
Banks) opinions of counsel given upon the express instructions of the Company,
the Permitted Borrowers and the Guarantors, dated the date hereof, and covering
such matters as required by and otherwise satisfactory in form and substance to
the Agent and each of the Banks.
6.11 Intercreditor Agreement and Existing Senior Debt. The
Intercreditor Agreement shall have been executed and delivered in form and
substance satisfactory to the Banks and Agent providing, among other things,
that the liens securing the Existing Senior Debt are in pari passu with the
liens securing the Indebtedness, and the Existing Senior Noteholders shall have
executed and delivered such acknowledgments, consent and approvals as required
to effectuate the transactions contemplated by this Agreement and the other
Loan Documents.
6.12 Company's Certificate. The Agent shall have received, with a
signed counterpart for each Bank, a certificate of a responsible senior officer
of Company, dated the date of the making of the initial Advances hereunder,
stating that the conditions of paragraphs 6.1, 6.8, 6.9 and 6.15(a) through (c)
hereof have been fully satisfied.
6.13 Payment of Agent's and Other Fees. Company shall have paid to
the Agent the Closing Fee (for distribution to the Banks hereunder), and to the
Agent, the Agent's Fees and all costs and expenses required hereunder.
6.14 Other Documents and Instruments. The Agent shall have
received, with a photocopy for each Bank, such other instruments and documents
as the Majority Banks may reasonably request in connection with the making of
Advances hereunder, and all such instruments and documents shall be
satisfactory in form and substance to the Majority Banks.
6.15 Continuing Conditions. Subject to the terms hereof, the
obligations of the Banks to make any of the Advances or loans under this
Agreement, including but not limited to the initial Advances of the Advances of
the Revolving Credit, Swing Line Advances or Term Loans hereunder, shall be
subject to the following continuing conditions:
(a) No Default or Event of Default shall have occurred
and be continuing as of the making of the proposed Advance (both before and
after giving effect thereto);
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(b) There shall have been no material adverse change in
the condition (financial or otherwise), properties, business, results or
operations of the Company and its Subsidiaries, taken as a whole, from December
31, 1994, except changes in the ordinary course of business (including without
limitation the information set forth in the Consolidated financial statements
of the Company and its Subsidiaries as of December 31, 1994), or any subsequent
December 31st, if the Agent determines, with the concurrence of the Majority
Banks, based on the Company's financial statements for such subsequent fiscal
year that no material adverse change has occurred during such year, such
determination being made solely for purposes of determining the applicable date
under this paragraph to the date of the proposed Advance hereunder;
(c) The representations and warranties contained in this
Agreement and the other Loan Documents are true and correct in all material
respects as of the making of the applicable Advance; and
(d) All documents executed or submitted pursuant hereto
shall be reasonably satisfactory in form and substance (consistent with the
terms hereof) to Agent and its counsel and to each of the Banks; Agent and its
counsel and each of the Banks and their respective counsel shall have received
all information, and such counterpart originals or such certified or other
copies of such materials, as Agent or its counsel and each of the Banks and
their respective counsel may reasonably request; and all other legal matters
relating to the transactions contemplated by this Agreement (including, without
limitation, matters arising from time to time as a result of changes occurring
with respect to any statutory, regulatory or decisional law applicable hereto)
shall be satisfactory to counsel to Agent and counsel to each of the Banks.
7. REPRESENTATIONS AND WARRANTIES
Each of the Company and the Permitted Borrowers represents and
warrants and such representations and warranties shall be deemed to be
continuing representations and warranties during the entire life of this
Agreement:
7.1 Corporate Authority. Each of the Company, the Subsidiaries and
the Permitted Borrowers is a corporation duly organized and validly existing in
good standing under the laws of the applicable jurisdiction of organization,
charter or incorporation; each of the Company, the Subsidiaries and the
Permitted Borrower is duly qualified and authorized to do business as a
corporation or foreign corporation in each jurisdiction where the character of
its assets or the nature of its activities makes such qualification necessary,
except where such failure to qualify and be authorized to do business could not
reasonably be expected to have a material adverse effect on the Company and its
Subsidiaries, taken as a whole.
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7.2 Due Authorization -- Company. Execution, delivery and
performance of this Agreement, the other Loan Documents, and any other
documents and instruments required under or in connection with this Agreement,
and the issuance of the Notes by the Company are within its corporate powers,
have been duly authorized, are not in contravention of law or the terms of the
Company's articles of incorporation or bylaws, and, except as have been
previously obtained or as referred to in Section 7.15, below, do not require
the consent or approval, material to the transactions contemplated by this
Agreement, or the Loan Documents, of any governmental body, agency or
authority.
7.3 Due Authorization -- Subsidiaries. Execution, delivery and
performance of this Agreement, the other Loan Documents and any other documents
and instruments required under or in connection with this Agreement by each of
the Permitted Borrowers and the Guarantors, and the issuance of the Notes by
the Permitted Borrowers and the Guaranties by the Guarantors, are within its
corporate powers, have been duly authorized, are not in contravention of law or
the terms of its articles of incorporation or bylaws or other organic documents
of the parties thereto, as applicable, and, except as have been previously
obtained (or as referred to in Section 7.15, below), do not require the consent
or approval, material to the transactions contemplated by this Agreement, or
the other Loan Documents, of any governmental body, agency or authority.
7.4 Title to Property. Each of the Company, the Permitted
Borrowers and the Subsidiaries has good and valid title to the property owned
by it, which property (individually or in the aggregate) is material to the
business or operations of the Company and its Subsidiaries, taken as a whole,
excluding imperfections in title not material to the ownership, use and/or
enjoyment of any such property.
7.5 Liens. There are no security interests in, Liens, mortgages or
other encumbrances on and no financing statements on file with respect to any
property of Company, the Permitted Borrowers or any of the Subsidiaries, except
for those Liens permitted under Section 9.6 hereof.
7.6 Subsidiaries. As of the date of this Agreement, there are no
directly or indirectly owned Subsidiaries of the Company, except for those
Subsidiaries identified in Schedule 7.6, attached hereto (on which Schedule are
identified, as of the date hereof, the Domestic Subsidiaries and the Foreign
Subsidiaries, the Significant Domestic Subsidiaries and the Significant Foreign
Subsidiaries and the Guarantors).
7.7 Taxes. The Company and its Subsidiaries each has filed on or
before their respective due dates, all federal, state and foreign tax returns
which are required to be filed or has obtained
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extensions for filing such tax returns and is not delinquent in filing such
returns in accordance with such extensions and has paid all taxes which have
become due pursuant to those returns or pursuant to any assessments received by
any such party, as the case may be, to the extent such taxes have become due,
except to the extent such tax payments are being actively contested in good
faith by appropriate proceedings and with respect to which adequate provision
has been made on the books of the Company or its Subsidiaries, as applicable,
as may be required by GAAP.
7.8 No Defaults. There exists no default under the provisions of
any instrument evidencing any permitted Debt of the Company or its Subsidiaries
or connected with any of the permitted Liens, or of any agreement relating
thereto, except where such default could not reasonably be expected to have a
material adverse effect on the Company and its Subsidiaries taken as a whole
and would not constitute a Default or an Event of Default under this Agreement
or any of the other Loan Documents according to the terms thereof.
7.9 Enforceability of Agreement and Loan Documents -- Company.
This Agreement, the Notes, the Company Guaranty, each of the other Loan
Documents to which the Company is a party, and all other certificates,
agreements and documents executed and delivered by Company under or in
connection herewith or therewith have each been duly executed and delivered by
duly authorized officers of the Company and constitute the valid and binding
obligations of the Company, enforceable in accordance with their respective
terms, except as enforcement thereof may be limited by applicable bankruptcy,
reorganization, insolvency, moratorium, ERISA or similar laws affecting the
enforcement of creditor's rights generally and by general principles of equity
(whether enforcement is sought in a proceeding in equity or at law).
7.10 Enforceability of Loan Documents -- Significant Subsidiaries.
This Agreement, the Notes, the Guaranties, each of the other Loan Documents to
which any of the Permitted Borrowers or the Guarantors is a party, and all
certificates, documents and agreements executed in connection herewith or
therewith by any of the Permitted Borrowers or the Guarantors have each been
duly executed and delivered by duly authorized officers of such parties and
constitute the valid and binding obligations of the Permitted Borrowers and the
Guarantors, enforceable in accordance with their respective terms, except as
enforcement thereof may be limited by applicable bankruptcy, reorganization,
insolvency, moratorium, ERISA or similar laws affecting the enforcement of
creditors' rights generally and by general principles of equity (whether
enforcement is sought in a proceeding in equity or at law).
7.11 Non-contravention -- Company. The execution, delivery and
performance of this Agreement and the other Loan Documents and any other
documents and instruments required under or in connection with this Agreement
by the Company are not in contravention of the
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terms of any indenture, material agreement or material undertaking to which the
Company is a party or by which it or its properties are bound or affected,
except to the extent such terms have been waived or are not material to the
transactions contemplated by this Agreement and the other Loan Documents.
7.12 Non-contravention -- Subsidiaries. The execution, delivery and
performance of this Agreement, those other Loan Documents signed by any of the
Permitted Borrowers or the Guarantors, and any other documents and instruments
required under or in connection with this Agreement by any of the Permitted
Borrowers or the Guarantors are not in contravention of the terms of any
indenture, material agreement or material undertaking to which any of the
Permitted Borrowers or the Guarantors is a party or by which it or its
properties are bound or affected, except to the extent such terms have been
waived or are not material to the transaction contemplated by this Agreement
and the other Loan Documents.
7.13 No Litigation -- Company. There is no suit, action,
proceeding, including, without limitation, any bankruptcy proceeding, or
governmental investigation pending against or, to the best knowledge of the
Company, threatened or otherwise affecting the Company (other than any suit,
action or proceeding in which the Company is the plaintiff and in which no
counterclaim or cross-claim against Company has been filed), nor has the
Company or any of its officers or directors been subject to any suit, action,
proceeding or governmental investigation as a result of which any such officer
or director is or may be entitled to indemnification by Company, except as
otherwise disclosed in Schedule 7.13 attached hereto and except for
miscellaneous suits, actions and proceedings which have a reasonable likelihood
of being adversely determined, and which suits, if resolved adversely to the
Company would not in the aggregate have a material adverse effect on the
Company and its Subsidiaries, taken as a whole. Except as so disclosed, there
is not outstanding against the Company any judgment, decree, injunction, rule,
or order of any court, government, department, commission, agency,
instrumentality or arbitrator, nor, to the best knowledge of the Company, is
the Company in violation of any applicable law, regulation, ordinance, order,
injunction, decree or requirement of any governmental body or court where such
violation would have a material adverse effect on the Company and its
Subsidiaries, taken as a whole.
7.14 No Litigation -- Other Parties. There is no suit, action,
proceeding (other than any suit, action or proceeding in which any such party
is the plaintiff and in which no counterclaim or cross-claim against any such
party has been filed), including, without limitation, any bankruptcy
proceeding, or governmental investigation pending against or, to the best
knowledge of the Company, threatened or otherwise affecting any of the
Subsidiaries or the Permitted Borrowers, nor has any such party or any of its
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officers or directors been subject to any suit, action, proceeding or
governmental investigation as a result of which any such officer or director is
or may be entitled to indemnification by such party, except as otherwise
disclosed in Schedule 7.14 attached hereto and except for miscellaneous suits,
actions and proceedings which have a reasonable likelihood of being adversely
determined, which suits, if resolved adversely to such party, would not in the
aggregate have a material adverse effect on the Company and its Subsidiaries,
taken as a whole. Except as so disclosed, there is not outstanding against any
such party any judgment, decree, injunction, rule, or order of any court,
government, department, commission, agency, instrumentality or arbitrator nor,
to the best knowledge of the Company, is any such party in violation of any
applicable law, regulation, ordinance, order, injunction, decree or requirement
of any governmental body or court where such violation would have a material
adverse effect on the Company and its Subsidiaries, taken as a whole.
7.15 Consents, Approvals and Filings, Etc. Except as have been
previously obtained or as are required for the consummation of the Dyno
Acquisition, no authorization, consent, approval, license, qualification or
formal exemption from, nor any filing, declaration or registration with, any
court, governmental agency or regulatory authority or any securities exchange
or any other person or party (whether or not governmental) is required in
connection with the execution, delivery and performance: (i) by the Company, of
this Agreement, any of the other Loan Documents to which it is a party or any
other documents or instruments to be executed and/or delivered by the Company
in connection therewith or herewith; and (ii) by each of the Permitted
Borrowers and the Guarantors, of this Agreement, the other Loan Documents to
which it is a party or any other documents or instruments to be executed and/or
delivered by each of the Permitted Borrowers or the Guarantors in connection
therewith or herewith. All such authorizations, consents, approvals, licenses,
qualifications, exemptions, filings, declarations and registrations which have
previously been obtained or made, as the case may be, are in full force and
effect and are not the subject of any attack, or to the knowledge of the
Company and the Permitted Borrowers, threatened attack (in any material
respect) by appeal or direct proceeding or otherwise.
7.16 Agreements Affecting Financial Condition. Neither the Company
nor any of the Permitted Borrowers (nor any of their respective Subsidiaries)
is party to any agreement or instrument or subject to any charter or other
corporate restriction which materially adversely affects the financial
condition or operations of the Company and its Subsidiaries, taken as a whole.
7.17 No Investment Company; No Margin Stock. Neither the Company
nor any of its Subsidiaries is engaged principally, or as one of its important
activities, directly or indirectly, in the business of extending credit for the
purpose of purchasing or
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carrying margin stock. None of the proceeds of any of the Advances will be used
by the Company, the Permitted Borrowers or any of the Subsidiaries to purchase
or carry margin stock or will be made available by the Company, the Permitted
Borrowers or any of the Subsidiaries in any manner to any other Person to
enable or assist such Person in purchasing or carrying margin stock. Terms for
which meanings are provided in Regulation U of the Board of Governors of the
Federal Reserve System or any regulations substituted therefor, as from time to
time in effect, are used in this paragraph with such meanings. Neither the
Company nor any of the Permitted Borrowers (nor any of their respective
Subsidiaries) is an "investment company" within the meaning of the Investment
Company Act of 1940, as amended.
7.18 ERISA. Except to the extent that an occurrence could not
reasonably be expected to have a material adverse effect on the Company and its
Subsidiaries taken as a whole: (a) neither a Reportable Event which is material
to the Company and its Subsidiaries taken as a whole nor an accumulated funding
deficiency (as defined in Section 412 of the Internal Revenue Code or Section
302 of ERISA) has occurred during the five-year period prior to the date on
which this representation is made or deemed made with respect to any Pension
Plan; (b) each Pension Plan has complied in all material respects with the
applicable provisions of ERISA and the Internal Revenue Code and any applicable
regulations thereof (and, if applicable, any comparable foreign law
provisions), except to the extent that any noncompliance, individually or in
the aggregate, would not have a material adverse effect upon the Company and
its Subsidiaries, taken as a whole; (c) no termination of a Single Employer
Plan has occurred, and no lien in favor of the PBGC or a Pension Plan has
arisen, during such five-year period; (d) the present value of all accrued
benefits under each Single Employer Plan maintained by the Company or any ERISA
Affiliate did not, as of the last annual valuation date prior to the date on
which this representation is made or deemed made, exceed the value of the
assets of such Pension Plan allocable to such accrued benefits; (e) neither the
Company nor any ERISA Affiliate has had a complete or partial withdrawal from
any Multiemployer Plan within the five year period prior to the date of this
Agreement, nor does the Company or any ERISA Affiliate presently intend to
completely or partially withdraw from any Multiemployer Plan, and neither the
Company nor any ERISA Affiliate would become subject to fines, penalties or any
other liability under ERISA if the Company or any ERISA Affiliate were to
withdraw completely from all Multiemployer Plans as of the valuation date most
closely preceding the date of this Agreement; (f) to the best of Company's
knowledge, no such Multiemployer Plan is in bankruptcy or reorganization or
insolvent; and (g) there is no pending or, to the best of Company's knowledge,
threatened litigation or investigation questioning the form or operation of any
Pension Plan, nor is there any basis for any such litigation or investigation
which if adversely determined could have a material adverse effect upon the
Company and its
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Subsidiaries, taken as a whole, as of the valuation date most closely preceding
the date of this Agreement.
7.19 Environmental Matters and Safety Matters. (a) The Company and
each Subsidiary is in compliance in all material respects with all applicable
federal, state, provincial and local laws, ordinances and regulations relating
to safety and industrial hygiene or to the environmental condition, including
without limitation all applicable Hazardous Materials Laws in jurisdictions in
which the Company or any such Subsidiary owns or operates a facility or site,
or arranges for disposal or treatment of hazardous substances, solid waste, or
other wastes, accepts for transport any hazardous substances, solid wastes or
other wastes or holds any interest in real property or otherwise, except for De
Minimis Matters or as otherwise disclosed on Schedule 7.19 hereto, and as to
any matters disclosed on such Schedule, none of such matters will, individually
or in the aggregate, have a material adverse effect upon the financial
condition or business of the Company and its Subsidiaries, taken as a whole.
(b) All federal, state, provincial, local and foreign
permits, licenses and authorizations required under the Hazardous Material Laws
for present or (to the best knowledge of the Company and the Permitted
Borrowers) past use of the facilities and other properties or activities of the
Company and each Subsidiary have been obtained and are presently in effect, and
there is and has been compliance in all material respects with all such
permits, licenses or authorizations, except for De Minimis Matters or as
otherwise disclosed on Schedule 7.19 hereto, and as to any matters disclosed on
such Schedule, none of such matters, individually or in the aggregate will have
a material adverse effect on the Company and its Subsidiaries taken as a whole.
(c) No demand, claim, notice, suit (in law or equity),
action, administrative action, investigation or inquiry (including, without
limitation, the listing of any property by any domestic or foreign governmental
entity which identifies sites for remedial, clean-up or investigatory action)
whether brought by any governmental authority, private person or entity or
otherwise, arising under or relating to or in connection with any applicable
Hazardous Material Laws is pending or, to the best knowledge of the Company and
the Permitted Borrowers, threatened against the Company or any of its
Subsidiaries, any real property in which the Company or any such Subsidiary
holds or, to the best of the Company's knowledge, has held an interest or any
present or, to the best knowledge of the Company and the Permitted Borrowers,
past operation of the Company or any such Subsidiary, except for De Minimis
Matters or as otherwise disclosed on Schedule 7.19 hereto, and as to any
matters disclosed on such Schedule, none of such matters, individually or in
the aggregate will have a material adverse effect on the financial condition or
business of the Company and its Subsidiaries, taken as a whole.
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(d) Neither the Company nor any of its Subsidiaries,
whether with respect to present or, to the best knowledge of the Company and
the Permitted Borrowers, past operations or properties, (i) is, to the best
knowledge of the Company and the Permitted Borrowers, the subject of any
federal or state investigation evaluating whether any remedial action is needed
to respond to a release of any Hazardous Materials into the environment, (ii)
has received any notice of any Hazardous Materials in or upon any of its
properties in violation of any applicable Hazardous Material Laws, or (iii)
knows of any basis for any such investigation or notice, or for the existence
of such a violation, except for De Minimis Matters or as otherwise disclosed on
Schedule 7.19 hereto, and as to any matters disclosed on such Schedule, none of
such matters, individually or in the aggregate will have a material adverse
effect on the financial condition or business of the Company and its
Subsidiaries, taken as a whole.
(e) No release, threatened release or disposal of any
Hazardous Materials is occurring or has occurred on, under or to any real
property in which the Company or any of its Subsidiaries holds any interest or
performs any of its operations, in violation of any applicable Hazardous
Material Laws, except for De Minimis Matters or as otherwise disclosed on
Schedule 7.19 hereto, and as to any matters disclosed on such Schedule, none of
such matters, individually or in the aggregate will have a material adverse
effect on the financial condition or business of the Company and its
Subsidiaries, taken as a whole.
7.20 Accuracy of Information. Each of the Company's audited or
unaudited financial statements previously furnished to Agent and the Banks by
the Company prior to the date of this Agreement, is complete and correct in all
material respects and fairly presents the financial condition of the Company
and its Subsidiaries, taken as a whole, and the results of their operations for
the periods covered thereby; any projections of operations for future years
previously furnished by Company to Agent or the Banks have been prepared as the
Company's good faith estimate of such future operations, taking into account
all relevant facts and matters known to Company; since December 31, 1994 there
has been no material adverse change in the financial condition of the Company
and its Subsidiaries, taken as a whole, except changes in the ordinary course
of business (including without limitation the information set forth in the
Consolidated financial statements of the Company and its Subsidiaries as of
December 31, 1994); neither the Company, nor any of its Subsidiaries has any
contingent obligations (including any liability for taxes) not disclosed by or
reserved against in the December 31, 1994 balance sheet which is likely to have
a material adverse effect on the Company and its Subsidiaries, taken as a
whole.
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8. AFFIRMATIVE COVENANTS
Each of the Company and the Permitted Borrowers covenants and agrees
that it will, and, as applicable, it will cause its Subsidiaries to, so long as
any of the Banks are committed to make any Advances under this Agreement and
thereafter so long as any Indebtedness remains outstanding under this
Agreement:
8.1 Preservation of Existence, Etc. Subject to the terms of this
Agreement: (i) preserve and maintain its existence and such of its rights,
licenses, and privileges as are material to the business and operations
conducted by it; (ii) qualify and remain qualified to do business in each
jurisdiction in which such qualification is material to its business and
operations or ownership of its properties; (iii) continue to conduct and
operate its businesses substantially as conducted and operated during the
present and preceding fiscal years; (iv) at all times maintain, preserve and
protect all of its franchises and trade names and preserve all the remainder of
its property and keep the same in good repair, working order and condition; and
(v) from time to time make, or cause to be made, all necessary or appropriate
repairs, replacements, betterments and improvements thereto such that the
businesses carried on in connection therewith may be properly and
advantageously conducted at all times.
8.2 Keeping of Books. Keep proper books of record and account in
which full and correct entries shall be made of all of its financial
transactions and its assets and businesses so as to permit the presentation of
financial statements prepared in accordance with GAAP.
8.3 Reporting Requirements. Furnish Agent with copies for each
Bank:
(a) as soon as possible, and in any event within three
Business Days after becoming aware of the occurrence of each Default
or Event of Default, a written statement of the chief financial
officer of the Company (or in his or her absence, a responsible senior
officer) setting forth details of such Default or Event of Default and
the action which the Company or any Permitted Borrower has taken or
has caused to be taken or proposes to take or cause to be taken with
respect thereto;
(b) as soon as available, and in any event within one
hundred twenty (120) days after and as of the end of each of Company's
fiscal years, (i) a detailed Consolidated audit report of Company
certified to by independent certified public accountants satisfactory
to Banks, together with an unaudited Consolidating report of Company
and its Subsidiaries (or, in lieu of such Consolidating report, other
financial reports as to the financial condition, on an individual
basis, of each of the Permitted Borrowers and Guarantors, in form
reasonably acceptable to Agent and the Majority Banks) certified by an
authorized officer of Company as to consistency (with prior
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financial reports and accounting periods), accuracy and fairness of
presentation; and (ii) a Covenant Compliance Report;
(c) as soon as available, and in any event within sixty
(60) days after and as of the end of each quarter, excluding the last
quarter of each fiscal year, (i) a Consolidated financial report
consisting of a balance sheet, income statement, statement of cash
flows and statement of shareholder's equity of Company and its
Subsidiaries certified by an authorized officer of Company as to
consistency (with prior financial reports and accounting periods),
accuracy and fairness of presentation and (ii) a Covenant Compliance
Report;
(d) as soon as available, and in any event within thirty
(30) days after the end of each calendar month, excluding those months
ending on the last day of each fiscal quarter, a Consolidated and
Consolidating balance sheet, income statement and statement of
shareholder's equity of Company and its Subsidiaries certified by an
authorized officer of Company as to consistency (with prior financial
reports and accounting periods), accuracy and fairness of
presentation;
(e) as soon as possible, and in any event within three
Business Days after becoming aware (i) of any material adverse change
in the financial condition of the Company, any of its Subsidiaries or
any of the Permitted Borrowers which could reasonably be expected to
have a material adverse effect upon the Company and its Subsidiaries,
taken as a whole, a certificate of the chief financial officer of
Company (or in his or her absence, a responsible senior officer)
setting forth the details of such change, and (ii) of the taking by
the Internal Revenue Service or any foreign taxing jurisdiction of a
written tax position which could reasonably be expected to have a
material adverse effect upon the Company and its Subsidiaries, taken
as a whole (or any such tax position taken by the Company or any of
its Subsidiaries or the Permitted Borrowers) setting forth the details
of such position and the financial impact thereof;
(f) as soon as available (and with copies for each of
the Banks), the Company's 8-K, 10-Q and 10-K Reports filed with the
federal Securities and Exchange Commission, and in any event, with
respect to the 10-Q Report, within sixty (60) days of the end of each
of the Company's fiscal quarters, and with respect to the 10-K Report,
within one hundred twenty (120) days after and as of the end of each
of Company's fiscal years; and as soon as available, copies of all
filings, reports or other documents filed by the Company or any of its
Subsidiaries with the federal Securities and Exchange
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Commission or comparable agencies or authorities in foreign
jurisdictions, or with any stock exchanges;
(g) promptly as issued, all press releases and notices
to shareholders transmitted by the Company or any of its Subsidiaries;
and
(h) promptly, and in form to be satisfactory to Agent
and the requesting Bank or Banks, such other information as Agent or
any of the Banks (acting through Agent) or the Collateral Agent may
reasonably request from time to time.
8.4 Consolidated Tangible Net Worth. Maintain, and cause its
Subsidiaries to maintain, at all times Consolidated Tangible Net Worth which on
a Consolidated basis will at no time be less than Ninety-Five Million Dollars
($95,000,000), plus the sum of the Net Income Adjustment and the Equity
Offering Adjustment.
8.5 Funded Debt Ratio. On a Consolidated basis, have and cause
its Subsidiaries to have, as of the end of each fiscal quarter, a Funded Debt
Ratio which will at no time exceed:
(a) from the date hereof through December 30, 1995, 6.0 to 1.0;
(b) from December 31, 1995 through March 30, 1996, 5.5 to 1.0;
(c) from March 31, 1996 through June 29, 1996, 5.0 to 1.0;
(d) from June 30, 1996 through September 29, 1996, 4.25 to 1.0;
(e) from September 30, 1996 to December 30, 1996, 3.75 to 1.0;
(f) from December 31, 1996 to December 30, 1997, 3.3 to 1.0;
(g) from December 31, 1997 to December 30, 1998, 2.9 to 1.0; and
(h) from and after December 31, 1998, 2.5 to 1.0.
8.6 Maintain Fixed Charge Coverage Ratio. On a Consolidated
basis, have and cause its Subsidiaries to have, as of the end of each fiscal
quarter, a Fixed Charge Coverage Ratio of not less than:
(a) from the date hereof through March 30, 1996, 1.25 to 1.0;
(b) from March 31, 1996 through September 29, 1996, 1.4 to 1.0;
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(c) from September 30, 1996 to December 30, 1996, 1.25 to 1.0;
(d) from December 31, 1996 to December 30, 1997, 1.35 to 1.0;
(e) from December 31, 1997 to December 30, 1998, 2.35 to 1.0; and
(f) from and after December 31, 1998, 2.5 to 1.0.
8.7 Inspections. Permit Agent and each Bank, through their
authorized attorneys, accountants and representatives to examine Company's and
each of the Subsidiaries' books, accounts, records, ledgers and assets and
properties of every kind and description wherever located, including without
limitation the Collateral, at all reasonable times during normal business
hours, upon oral or written request of Agent or such Bank; and permit Agent and
each Bank or their authorized representatives, at reasonable times and
intervals, to visit all of its offices, discuss its financial matters with its
officers and independent certified public accountants, and by this provision
Company authorizes such accountants to discuss the finances and affairs of
Company and its Subsidiaries (provided that Company is given an opportunity to
participate in such discussions) and examine any of its or their books and
other corporate records. An examination of the records or properties of Company
or any of its Subsidiaries may require revealment of proprietary and/or
confidential data and information, and the Agent and each of the Banks agrees
upon request of the inspected party to execute a confidentiality agreement
(reasonably satisfactory to Agent or the inspecting Bank, as the case may be,
and such party) on behalf of the Agent or such inspecting Bank and all parties
making such inspections or examinations under its authorization; provided
however that such confidentiality agreement shall not prohibit Agent from
revealing such information to Banks or prohibit the inspecting Bank from
revealing such information to Agent or another Bank. Notwithstanding the
foregoing, all information furnished to the Banks hereunder shall be subject to
the undertakings of the Banks set forth in Section 14.13 hereof.
8.8 Taxes. Pay and discharge all taxes and other governmental
charges, and all material contractual obligations calling for the payment of
money, before the same shall become overdue, unless and to the extent only that
such payment is being contested in good faith by appropriate proceedings and is
reserved for, as required by GAAP on its balance sheet, or where the failure to
pay any such matter could not have a material adverse effect on the Company and
its Subsidiaries, taken as a whole.
8.9 Further Assurances; Financing Statements. Furnish to the
Collateral Agent, at Company's sole expense, upon Majority Banks' (or
Collateral Agent's) request, in form reasonably satisfactory to the Majority
Banks, assignments, lien instruments or other security
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instruments, consents, acknowledgments, subordinations and financing statements
covering any or all of the Collateral pledged, assigned, or encumbered pursuant
to the Company Collateral Documents or the Guarantor Collateral Documents, of
every nature and description, whether now owned or hereafter acquired (by
Company or any Guarantor), to the extent that the Collateral Agent may
reasonably require, and execute and deliver or cause to be executed and
delivered such other documents or instruments as the Agent may reasonably
require to effectuate more fully the purposes of this Agreement or the other
Loan Documents.
8.10 Insurance. Maintain, with financially sound and reputable
insurers, insurance with respect to its Material Property and business against
such casualties and contingencies, of such types (including, without
limitation, insurance with respect to losses arising out of such property loss
or damage, public liability, business interruption, larceny, workers'
compensation, embezzlement or other criminal misappropriation) and in such
amounts as is customary in the case of corporations of established reputations
engaged in the same or similar business and similarly situated.
8.11 Indemnification. With respect to the Company, indemnify and
save Agent and each of the Banks (and their respective officers, directors,
agents, employees and other representatives) harmless from all reasonable loss,
cost, damage, liability or expenses, including reasonable attorneys' fees and
disbursements, incurred by Agent and each of the Banks (and their respective
officers, directors, agents, employees and other representatives) by reason of
an Event of Default or enforcing the obligations of the Company, the Permitted
Borrowers or any of the Significant Subsidiaries under this Agreement or the
other Loan Documents, or in the prosecution or defense of any action or
proceeding concerning any matter growing out of or connected with this
Agreement or any of the other Loan Documents (including, without limitation,
the Agent's confidential information memorandum dated May 24, 1995, the New
Senior Debt Documents and any Offering Memorandum distributed in connection
therewith, the Existing Senior Debt Documents and the Dyno Acquisition
Agreement) other than resulting from the gross negligence or willful misconduct
of Agent or such Bank or Banks, as the case may be; and, with respect to each
of the Permitted Borrowers and the Significant Subsidiaries, indemnify and save
Agent and each of the Banks (and their respective officers, directors, agents,
employees and other representatives) harmless from all reasonable loss, cost,
damage, liability or expenses, including reasonable attorneys' fees and
disbursements, incurred by Agent and each of the Banks (and their respective
officers, directors, agents, employees and other representatives) with respect
to such parties by reason of an Event of Default or enforcing the obligations
of such parties under this Agreement or the other Loan Documents or in the
prosecution or defense of any action or proceeding concerning any matter
growing out of or connected with this Agreement or any of the other Loan
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Documents (including, without limitation, the Agent's confidential information
memorandum dated May 24, 1995, the New Senior Debt Documents and any Offering
Memorandum distributed in connection therewith, the Existing Senior Debt
Documents and the Dyno Acquisition Agreement), other than resulting from the
gross negligence or willful misconduct of Agent or such Bank or Banks, as the
case may be.
8.12 Governmental and Other Approvals. Apply for, obtain and/or
maintain in effect, as applicable, all material authorizations, consents,
approvals, licenses, qualifications, exemptions, filings, declarations and
registrations (whether with any court, governmental agency, regulatory
authority, securities exchange or otherwise) which are necessary in connection
with the execution, delivery and performance of this Agreement, the other Loan
Documents, or any other documents or instruments to be executed and/or
delivered by the Company or the Permitted Borrower, as the case may be, in
connection therewith or herewith, and, upon and after the consummation thereof,
in connection with the Dyno Acquisition.
8.13 Compliance with Contractual Obligations and Laws. Comply in
all material respects with all Contractual Obligations and with all applicable
laws, rules, regulations and orders of any governmental authority, whether
federal, state, local or foreign (including without limitation Hazardous
Material Laws and any consumer protection, truth in lending, disclosure and
other similar laws and regulations governing the provision of financing to
consumers), in effect from time to time, except to the extent that failure to
comply therewith could not reasonably be expected to have, individually or in
the aggregate, a material adverse effect on the business, operations, property
or financial or other condition of the Company, the Permitted Borrowers and
their respective Subsidiaries, taken as a whole, and could not reasonably be
expected to materially adversely affect the ability of any of the Company, the
Permitted Borrowers or the Significant Subsidiaries to perform their respective
obligations under any of the Loan Documents to which they are a party.
8.14 ERISA. Comply in all material respects with all requirements
imposed by ERISA as presently in effect or hereafter promulgated or the
Internal Revenue Code (or comparable laws in applicable jurisdictions outside
the United States of America relating to foreign Pension Plans) and promptly
notify Banks upon the occurrence of any of the following events:
(a) the termination of any Pension Plan pursuant to
Subtitle C of Title IV of ERISA or otherwise (other than any defined
contribution plan not subject to Section 412 of the Internal Revenue Code and
any Multiemployer Plan);
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(b) the appointment of a trustee by a United States
District Court to administer any Pension Plan pursuant to ERISA;
(c) the commencement by the PBGC, or any successor
thereto, of any proceeding to terminate any Pension Plan;
(d) the failure of the Company or any ERISA Affiliate to
make any payment in respect of any Pension Plan required under Section 412 of
the Internal Revenue Code;
(e) the withdrawal of the Company or any ERISA Affiliate
from any Multiemployer Plan;
(f) the occurrence of an accumulated funding deficiency
(defined in Section 7.18 hereof) or a Reportable Event; or
(g) the occurrence of a Prohibited Transaction which
could reasonably be expected to have a material adverse effect upon the Company
and its Subsidiaries, taken as a whole.
8.15 Environmental Matters.
(a) Promptly notify the Agent and the Banks in writing of: (i) any
and all enforcement, cleanup, removal or other governmental or regulatory
actions instituted or completed pursuant to any applicable Hazardous Material
Laws; (ii) any and all claims made by any Person against the Company, any of
its Subsidiaries, the Permitted Borrowers or Dyno, or any of its other property
(whether real or personal, or any portion thereof) relating to damage,
contribution, cost recovery, compensation, loss or injury resulting from any
Hazardous Material (provided that, until the Dyno Acquisition, notification to
Agent of claims against Dyno shall not be required except for claims of which
Company has actual knowledge) which could reasonably be expected to have a
material adverse effect on the Company and its Subsidiaries, taken as a whole;
and (iii) Company's discovery of any occurrence or condition on any real
property or fixtures constituting a part of, adjoining or in the vicinity of
any of its property that could cause any such property (or any part thereof) to
be subject to any material restrictions on the ownership, occupancy,
transferability or use thereof under any Hazardous Material Laws, it being
understood and agreed that the Agent, on behalf of the Banks, shall have the
right to join and participate in, as a party if it or they so elect, any legal
proceedings or actions initiated in connection with any of the matters
described in subparagraphs (a) (i) or (a) (ii), above, and the Company agrees,
provided that an Event of Default has occurred and is continuing, to pay the
Agent's reasonable attorneys fees in connection therewith.
(b) Conduct and complete all investigations, studies, sampling and
testing, and all remedial, removal and other actions necessary to clean-up and
remove all Hazardous Materials on or
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affecting any premises owned or occupied by Company or any of its Subsidiaries,
whether resulting from conduct of Company or any of its Subsidiaries or any
other Person, if required by Hazardous Material Laws, all such actions to be
taken in accordance with such laws;
(c) From and after the Dyno Acquisition, with respect to the
properties and operations of Dyno, commence and diligently proceed to
completion, in accordance with applicable Hazardous Material Laws, with the
necessary remedial, corrective or other actions identified in any Schedule or
other written disclosure delivered to Agent and the Banks in connection with
the consummation of the Dyno Acquisition, as applicable, or as required under
the Dyno Acquisition Agreement, and cause Dyno, or its Subsidiaries, (to the
extent of its obligations under the Dyno Acquisition Agreement) to do so,
according to the time periods specified therein, or if no time periods are so
specified, as soon as reasonably practicable; provided that Company's
obligations under this subparagraph (c) shall not reduce or otherwise affect
Company's other obligations hereunder.
(d) Defend, indemnify and hold harmless Agent and each of the
Banks, and their respective employees, agents, officers and directors from and
against any and all claims, demands, penalties, fines, liabilities,
settlements, damages, costs or expenses of whatever kind or nature arising out
of or related to (i) the presence, disposal, release or threatened release of
any Hazardous Materials in violation of any applicable Hazardous Material Laws
on, from or affecting any premises owned or occupied by Company or any of its
Subsidiaries, (ii) any personal injury (including wrongful death) or property
damage (real or personal) arising out of or related to such Hazardous
Materials, (iii) any lawsuit or other proceeding brought or threatened,
settlement reached or governmental order or decree relating to such Hazardous
Materials, (iv) the cost of removal of all Hazardous Materials from all or any
portion of any premises owned by Company or its Subsidiaries, (v) the taking of
necessary precautions to protect against the release of Hazardous Materials in
violation of any applicable Hazardous Material Laws on or affecting any
premises owned by Company or any of its Subsidiaries, (vi) complying with all
Hazardous Material Laws and/or (vii) any material violation by Company or any
of its Subsidiaries of Hazardous Material Laws, including without limitation,
reasonable attorneys and consultants fees, investigation and laboratory fees,
environmental studies required by Agent or any Bank (whether before or after
the occurrence of any Default or Event of Default hereunder), court costs and
litigation expenses; and, if so requested by Agent or any Bank, Company shall
execute, and shall cause each of the Permitted Borrowers to execute, separate
indemnities covering the foregoing matters. The obligations of Company and
Permitted Borrowers under this Section 8.15 shall be in addition to any and all
other obligations and liabilities the Company or the Permitted Borrowers may
have to
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Agent or any of the Banks at common law or pursuant to any other agreement.
(e) Following the occurrence and during the continuance of a
Default or Event of Default, Agent may retain (on its own behalf and on behalf
of the Banks, but at Company's sole expense) such environmental auditors as
reasonably necessary to evaluate and/or confirm Company's environmental
responses, reports or other matters, including Company's compliance with
Hazardous Material Laws generally, under this Section 8.15, or elsewhere
herein.
8.16 Power of Attorney. Subject to the Intercreditor Agreement (and
the rights and powers of Collateral Agent thereunder), Company does hereby
make, constitute and appoint any officer or agent of Agent as its true and
lawful attorney-in-fact, with power, upon the occurrence of any Event of
Default (exercisable so long as such Event of Default is continuing and with
full power of substitution), to endorse its name, or the names of any of its
officers or agents, upon any notes, checks, drafts, money orders, or other
instruments of payment (including payments payable under any policy of
insurance) or Collateral that may come into possession of the Agent in full or
part payment of any amounts owing to the Banks; to sign and endorse the name of
Company, and/or any of its officers or agents, upon any invoice, freight or
express bill, bill of lading, storage or warehouse receipts, drafts against
debtors, assignments, verifications and notices in connection with Accounts of
the Company, and any instrument or document relating thereto or to Company's
rights therein; to execute on behalf of Company any financing statements,
amendments, subordinations or other filings pursuant to this Agreement or any
of the Loan Documents, granting unto Agent, as the attorney-in- fact of
Company, full power to do any and all things necessary to be done in and about
the Company's or any Subsidiary's premises as fully and effectually as Company
might or could do, and hereby ratifying all that any said attorney shall
lawfully do or cause to be done by virtue hereof. The power of attorney
described herein shall be deemed coupled with an interest and shall be
irrevocable until the payment in full of all the Indebtedness, the expiration
of any commitments to lend hereunder (or otherwise) and the performance by
Company, the Permitted Borrowers and the Guarantors of all other obligations
under this Agreement and the Loan Documents; Agent may, at any time after the
occurrence of an Event of Default, but before the expiration of any applicable
cure period or delivery of any required notice, notify Account Debtors that
Collateral has been assigned to Agent on behalf of the Banks and that payments
shall be made directly to Agent. Upon request of the Agent, Company will so
notify such Account Debtors and will indicate on all billings to such Account
Debtors that their accounts must be paid to or as directed by Agent. Upon the
occurrence and during the continuance of any Event of Default, the Agent acting
on behalf of the Banks shall have full power to collect, compromise, endorse,
sell or otherwise deal with the Collateral or proceeds thereof in the name
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of the Agent or in the name of Company, provided only that Agent shall act in a
commercially reasonable manner.
8.17 Significant Subsidiaries; Joinder Agreements. (a) With respect
to Walbro Netherlands, Walbro France, Walbro Belgium and Walbro Spain, as soon
as practicable under local law (as determined by Agent, in its reasonable
discretion), and with respect to each Subsidiary which becomes a Significant
Subsidiary subsequent to the date of this Agreement, within thirty days of the
date a Subsidiary becomes a Significant Subsidiary or a new Subsidiary is
created or acquired which is a Significant Subsidiary, as the case may be,
cause such Subsidiary to execute and deliver to Agent, for and on behalf of
each of the Banks, a Joinder Agreement whereby such Subsidiary becomes
obligated as a Guarantor under the Domestic Guaranty or the Permitted Borrowers
Guaranty, as applicable, and with respect to each Significant Domestic
Subsidiary a joinder agreement whereby such Subsidiary becomes obligated under
the Collateral Documents as then in effect, or, to the extent necessary or
appropriate (as determined by the Majority Banks or Collateral Agent), executes
and delivers new Collateral Documents, in each and all such cases accompanied
by such supporting documentation, including without limitation corporate
authority items, certificates and opinions of counsel, as reasonably required
by Agent and the Majority Banks.
(b) Furthermore, with respect to each Subsidiary which
becomes a Significant Subsidiary subsequent to the date hereof and the capital
stock or share capital of which is owned by Company or a Significant Domestic
Subsidiary, Company or such Significant Domestic Subsidiary, as the case may
be, shall promptly execute and deliver to Collateral Agent such Collateral
Documents as necessary to encumber (i) 100% of the capital stock or share
capital thereof (in the case of the pledge of share capital or capital stock of
any Significant Domestic Subsidiary) and (ii) 65% of the capital stock or share
capital thereof (in the case of the pledge of share capital or capital stock of
any Significant Foreign Subsidiary), in each case accompanied by such
supporting documentation, including without limitation corporate authority
items, certificates and opinions of counsel, as reasonably required by Agent
and the Majority Banks.
8.18 Financial Covenant Amendments. In the event that, at any time
while this Agreement is in effect, the Company shall issue any indebtedness for
borrowed money which is not by its terms subordinate and junior to other
indebtedness of Company and its Subsidiaries for borrowed money and such
indebtedness shall include, or be issued pursuant to a trust indenture or other
agreement which includes, financial covenants which are not substantially
identical to the financial covenants set forth in this Agreement, the Company
shall so advise the Agent in writing. Such notice shall be accompanied by a
copy of the applicable agreement containing such financial covenants. The
Agent shall
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promptly furnish a copy of such notice and the applicable agreement to each of
the Banks. If the Majority Banks determine in their sole discretion that some
or all of the financial covenants set forth in such agreement are more
favorable to the lender thereunder than the financial covenants set forth in
this Agreement ("More Favorable Terms") and that the Majority Banks desire that
this Agreement be amended to incorporate the More Favorable Terms, then the
Agent shall give written notice of such determination to the Company.
Thereupon, and in any event within thirty (30) days following the date of
notice by Agent to the Company, Company, the Permitted Borrowers and the Banks
shall enter into an amendment to this Agreement incorporating, on terms and
conditions acceptable to the Majority Banks, the More Favorable Terms.
9. NEGATIVE COVENANTS
Company covenants and agrees that, so long as any of the Banks are
committed to make any Advances under this Agreement and thereafter so long as
any Indebtedness remains outstanding, it will not, and it will not allow its
Subsidiaries, without the prior written consent of the Majority Banks, to:
9.1 Capital Structure and Redemptions. Purchase, acquire or redeem
any of its capital stock or make any material change in its capital structure,
provided however that the issuance of additional voting common stock shall not
be deemed to constitute a material change in capital structure; and provided
further that, with respect to the Significant Subsidiaries owned by Company or
any of its Domestic Subsidiaries, any increase in the share capital (or the
creation of any new share capital) of any of such Significant Subsidiaries
shall be permitted only if, at the time of any such increase or the creation of
any new shares, as the case may be, such shares are immediately subjected to a
pledge and security interest in favor of the Collateral Agent, for and on
behalf of the Lenders, pursuant to the applicable Collateral Documents (to the
extent required thereunder), and all steps are taken as necessary under
applicable law to perfect each such pledge and security interest.
9.2 Business Purposes. Make any material change in its general
business objects or purposes from those existing as of the date hereof or enter
into any business, directly or through any Subsidiary, except for those
businesses in which the Company and its Subsidiaries are engaged on the date of
this Agreement or other businesses which are directly related thereto.
9.3 Mergers or Dispositions. Enter into any merger or
consolidation, except for any Permitted Merger, or sell, lease, transfer,
relocate or dispose of all, substantially all, or any material part of its
assets, except for Permitted Transfers.
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9.4 Guaranties. Guarantee, endorse, or otherwise become liable for
or upon the obligations of others, except by endorsement of cash items for
deposit in the ordinary course of business and except for the Guaranties and
the Permitted Guaranties.
9.5 Debt. Become or remain obligated for any indebtedness for
borrowed money, or for any indebtedness incurred in connection with the
acquisition of any property, real or personal, tangible or intangible, or for
any other Debt, except for:
(a) Indebtedness to Banks hereunder;
(b) current unsecured trade, utility or
non-extraordinary accounts payable arising in the ordinary course of Company's
or any Subsidiary's businesses;
(c) purchase money debt for fixed assets (including
capitalized leases or other non-cancelable leases having a term of twelve
months or longer) not to exceed an aggregate amount, for the Company and its
Subsidiaries incurred while no Default or Event of Default exists under this
Agreement or the other Loan Documents, of Twenty Million Dollars ($20,000,000)
(or the Alternative Currency equivalent thereof) at any one time outstanding;
(d) the Existing Senior Debt, the New Senior Debt, the
Subordinated Debt and such other debt set forth in Schedule 9.5 attached
hereto, if any (in addition to any other matters set forth in this Section
9.5), and any renewals or refinancing of such indebtedness in amounts not
exceeding the scheduled amounts (less any required amortization according to
the terms thereof) on substantially the same terms and otherwise in compliance
with this Agreement;
(e) other Debt for borrowed money in an amount not to
exceed in the aggregate for the Company and its Subsidiaries at any time
outstanding, the sum of Five Million Dollars ($5,000,000) (or the Alternative
Currency equivalent thereof), which Debt shall be neither secured nor subject
to any guaranty; and
(f) Intercompany Loans, but only to the extent permitted
under the other applicable terms and limitations of this Agreement, including
but not limited to Section 9.8 hereof.
9.6 Liens. Permit or suffer any Lien to exist on any of its
properties, real, personal or mixed, tangible or intangible, whether now owned
or hereafter acquired, except:
(a) in favor of Collateral Agent, as security in pari
passu for the Indebtedness and the Lender Debt, in accordance with the
Intercreditor Agreement;
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(b) purchase money security interests in fixed assets to
secure the purchase money indebtedness permitted in Section 9.5(c) hereof,
provided that each such security interest is created substantially
contemporaneously with the acquisition of such fixed assets and does not extend
to any property other than the fixed asset so financed and provided further
that the sum of all such purchase money indebtedness outstanding at any time
shall not exceed the aggregate amount set forth in Section 9.5(c), hereof; and
(c) any lien securing Debt assumed pursuant to a
Permitted Acquisition, provided that such Lien is limited to the property so
acquired, and was not entered into, extended or renewed in contemplation of
such acquisition; and
(d) Permitted Liens.
9.7 Acquisitions. Other than any Permitted Acquisition, purchase
or otherwise acquire or become obligated for the purchase of all or
substantially all or any material portion of the assets or business interests
of any Person, firm or corporation, or any shares of stock (or other ownership
interests) of any corporation, trusteeship or association, or any business or
going concern, or in any other manner effectuate or attempt to effectuate an
expansion of present business by acquisition.
9.8 Investments. Make or allow to remain outstanding any
Investment in, or any loans or advances to, any Person, firm, corporation or
other entity or association, other than:
(a) any loan or other advance by Company or a
Subsidiary, as the case may be, to any and all of its officers or employees, as
the case may be, in the normal course of business, so long as the aggregate of
all such loans or advances by the Company and its Subsidiaries does not exceed
One Million Dollars ($1,000,000) (or the equivalent thereof in any Alternative
Currency) at any time outstanding, plus reasonable, reimbursable business and
travel expenses;
(b) Permitted Investments at any time outstanding or in
effect;
(c) Investments in Company's Subsidiaries existing as of
the date of this Agreement;
(d) The existing investments, loans and/or advances set
forth on Schedule 9.8 hereto, in addition to any other matters set forth in
this Section 9.8);
(e) Intercompany Loans, Advances, or Investments to
Company's Significant Domestic Subsidiaries;
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(f) Intercompany Loans, Advances, or Investments to
Company's Significant Foreign Subsidiaries without regard to any repayment of
such loans, advances, or investments (other than the repayment or recovery of
capital or principal), in an aggregate amount at any time outstanding not to
exceed (absent the consent of the Majority Banks), exclusive of the investments
permitted under subsections (a) through (c) and (l) of this Section 9.8, but
including any such loans, advances or investments permitted under any other
provision of this Agreement, the difference between (i) Sixty Million Dollars
($60,000,000) (or the equivalent thereof in any applicable Alternative
Currency) and (ii) the aggregate amount of Advances outstanding to the
Significant Foreign Subsidiaries at such time, determined as aforesaid;
(g) Intercompany Loans, Advances, or Investments to
Company's Subsidiaries which are not Significant Subsidiaries without regard to
any repayment of such loans, advances, or investments (other than the repayment
or recovery of capital or principal), in an aggregate amount at any time
outstanding not to exceed (absent the consent of the Majority Banks), exclusive
of the investments permitted under subsections (a) through (c) and (l) of this
Section 9.8, but including any such loans, advances or investments permitted
under any other provision of this Agreement, Five Million Dollars ($5,000,000)
(or the equivalent thereof in any Alternative Currency);
(h) loans, advances or investments (without regard to
any repayment of such loans, advances or investments, other than the repayment
of capital or principal) to any Joint Venture or Subsidiary which does not
constitute a 100% Subsidiary, including without limitation (i) loans, advances
or investments permitted under any other provision of this Agreement and (ii)
guaranties by the Company or any Subsidiary (valued on the basis of the
aggregate amount of such indebtedness covered by a guaranty) of third-party
indebtedness of any such Joint Venture or non-100% Subsidiary, in an aggregate
amount, for all such loans, advances and investments under this subsection (h),
at any time not to exceed twenty percent (20%) of Consolidated Tangible Net
Worth;
(i) subject to the terms and conditions of this
Agreement, including without limitation Sections 8.4 through 8.6 hereof,
foreign currency investments and other hedging instruments intended solely to
protect the Company from foreign currency fluctuations directly related to any
Permitted Acquisition, or otherwise in the ordinary course of its business
operations;
(j) other short term investments (excluding investments
in Subsidiaries, Affiliates or Joint Ventures) made or maintained by any
Foreign Subsidiary outside of the United States of America in the ordinary
course of its business, consistent with the present investment practices of the
Company and its Subsidiaries as of the
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date hereof (generally, and as to the individual and aggregate amounts and
other terms thereof);
(k) investments, whether by acquisition of shares of
Capital Stock, indebtedness or other obligations or security of, any Person
(other than a Subsidiary or an Affiliate) which is a customer of the Company or
any Subsidiary, which investment was made in exchange for amounts owed by such
customer to the Company or any Subsidiary (and incurred in the ordinary course
of business) or as an advance on the provision of goods and services in the
ordinary course of business; and
(l) the Dyno Acquisition, to the extent such acquisition
shall be deemed to constitute an Investment.
In valuing any Investments for the purpose of applying the limitations set
forth in this Section 9.8 (except as otherwise expressly provided herein), such
Investment shall be taken at the original cost thereof, without allowance for
any subsequent write-offs or appreciation or depreciation, but less any amount
repaid or recovered on account of capital or principal.
9.9 Accounts Receivable. Sell or assign any account, note or trade
acceptance receivable, except to Agent on behalf of the Banks.
9.10 Transactions with Affiliates. Enter into any transaction with
any of its or their stockholders or officers or its or their Affiliates, except
in the ordinary course of business and on terms not less favorable than would
be usual and customary in similar transactions between Persons dealing at arm's
length.
9.11 Dyno Capital Expenditures. Incur or make Dyno Capital
Expenditures (determined on a Consolidated basis) in aggregate amounts greater
than (a) from the date of the Dyno Acquisition, if the same shall occur,
through December 31, 1995, the sum of Fifteen Million Dollars ($15,000,000) (or
the equivalent thereof in any Alternative Currency) and (b) from January 1,
1996 through (and including) June 30, 1996, the sum of Ten Million Dollars
($10,000,000) (or the equivalent thereof in any Alternative Currency), in each
case on a non-cumulative basis.
9.12 No Further Negative Pledges. Enter into or become subject to
any agreement (other than loan documents evidencing or otherwise related to the
Existing Senior Debt, the New Senior Debt, or any purchase money Debt permitted
under this Agreement or the other Loan Documents, but only to the extent of the
property acquired with the proceeds of such purchase money Debt) (i)
prohibiting the guaranteeing by the Company or any Subsidiary of any
obligations, (ii) prohibiting the creation or assumption of any lien or
encumbrance upon the properties or assets of the Company or any Subsidiary,
whether now owned or hereafter acquired, or (iii)
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requiring an obligation to become secured (or further secured) if another
obligation is secured or further secured.
9.13 Prepayment of Debts. Prepay, purchase, redeem or defease any
Debt for money borrowed or any capital leases (including without limitation the
Existing Senior Debt, the New Senior Debt and the Subordinated Debt),
excluding, subject to the terms hereof, the Indebtedness, and excluding
paydowns from time to time of permitted working capital facilities or other
revolving debt.
9.14 Amendment of Existing Senior Debt Documents and New Senior
Debt Documents and Subordinated Debt. Amend, modify or otherwise alter (or
suffer to be amended, modified or altered) any of the material terms and
conditions of those documents or instruments evidencing or otherwise related to
the New Senior Debt or any Subordinated Debt or waive (or permit to be waived)
any provision thereof in any material respect, without the prior written
approval of Agent and the Majority Banks, and amend, modify or otherwise alter
(or suffer to be amended, modified or altered) any of the terms of the Existing
Senior Debt Documents, the amendment, modification or alteration of which are
restricted by Section 2.1(a) of the Intercreditor Agreement, except in
compliance therewith. For purposes of those documents or instruments evidencing
or otherwise related to such Debt (other than the Existing Senior Debt), any
increase in the original interest rate or principal amount, any shortening of
the original amortization, any change in any default, remedial or other
repayment terms and any change in or waiver of conditions contained therein
which are required under or necessary for compliance with this Agreement or the
other Loan Documents or, with respect to the Subordinated Debt, any change in
the subordination provisions contained therein, shall (without reducing the
scope of this Section 9.14) be deemed to be material.
10. DEFAULTS
10.1 Events of Default. Any of the following events is an "Event of
Default":
(a) non-payment when due of the principal or interest
under any of the Notes issued hereunder in accordance with the terms
thereof or of any reimbursement obligation under Section 3.6 hereof,
and in the case of interest payments, continuance thereof for three
(3) Business Days;
(b) default in the payment of any money by Company or
any of the Permitted Borrowers under this Agreement (other than as set
forth in subsection (a), above), within three (3) days of the date the
same is due and payable;
(c) default in the observance or performance of any of
the other conditions, covenants or agreements set forth in
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this Agreement or any of the other Loan Documents by any party thereto
(provided that, with respect to the covenants set forth in Sections
8.8, 8.10, 8.13, 8.14 and 8.15(b) hereof, such event has continued for
thirty (30) consecutive days) or the occurrence of any other default
or event of default, as the case may be, hereunder or thereunder;
(d) any representation or warranty made by Company or
any of the Permitted Borrowers herein or in any instrument submitted
pursuant hereto or by any other party to the Loan Documents proves
untrue in any material adverse respect when made or deemed made;
(e) default in the observance or performance of or
failure to comply with any of the conditions, covenants or agreements
of Company or any Guarantor set forth in any of the other Loan
Documents (including without limitations any of the Collateral
Documents), and the continuance thereof beyond any period of grace or
cure specified in any such document;
(f) any provision of the Company Guaranty, the Domestic
Guaranty or the Permitted Borrower Guaranty shall at any time for any
reason cease to be valid and binding and enforceable against the
Company or any of the Guarantors, as applicable, or the validity,
binding effect or enforceability thereof shall be contested by any
Person, or the Company or any of the Guarantors shall deny that it has
any or further liability or obligation under the Company Guaranty, the
Domestic Guaranty or the Permitted Borrower Guaranty, as applicable,
or the Company Guaranty, the Domestic Guaranty or the Permitted
Borrower Guaranty shall be terminated, invalidated, revoked or set
aside or in any way cease to give or provide to the Banks and the
Agent the benefits purported to be created thereby;
(g) any default in the observance, payment or
performance of or failure to comply with any of the conditions,
covenants or agreements of Company or any of its Subsidiaries under
the Existing Senior Debt Documents, the New Senior Debt Documents or
any Subordinated Debt Documents, and the continuance thereof beyond
any period of grace or cure specified in any such document;
(h) any default in the payment of any other obligation
of Company or any of its Subsidiaries for borrowed money or under a
capital lease in an amount, individually or in the aggregate in excess
of Five Million Dollars ($5,000,000), or the equivalent thereof in any
Alternative Currency, and the continuance thereof beyond any
applicable period of grace or cure; or any default in the observance
or performance of any conditions, covenants or agreements related or
given with respect to any other obligations for borrowed money or
under a capital lease in an amount, individually or in the
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aggregate, in excess of Five Million Dollars ($5,000,000), or the
equivalent thereof in an Alternative Currency, sufficient to permit
the holder thereof to accelerate the maturity of such obligation;
(i) a final judgment or final judgments for the payment
of money aggregating in excess of Five Million Dollars ($5,000,000),
or the equivalent thereof in an Alternative Currency, shall be
outstanding against any one or more of the Company and its
Subsidiaries and any one of such judgments shall have been outstanding
for more than thirty (30) days from the date of its entry, except to
the extent that any such judgment is being contested in good faith by
appropriate proceedings which provide for a stay of any enforcement
action against the Company or such Subsidiary during the pendency of
such proceedings and for which adequate reserves have been established
and where nonpayment of such judgment could not reasonably be expected
to have a material adverse effect on the Company and its Subsidiaries
taken as a whole;
(j) (i) any Person shall engage in any Prohibited
Transaction involving any Pension Plan, (ii) any accumulated funding
deficiency (as defined in Section 7.18 hereof), whether or not waived,
shall exist with respect to any Pension Plan or any Lien in favor of
the PBGC or a Pension Plan shall arise on the assets of the Company or
any ERISA Affiliate, (iii) a Reportable Event shall occur with respect
to, or proceedings shall commence to have a trustee appointed, or a
trustee shall be appointed, to administer or to terminate, any Single
Employer Plan, (iv) any Single Employer Plan shall terminate for
purposes of Title IV of ERISA or (v) the Company or any ERISA
Affiliate shall, or in the reasonable opinion of the Majority Banks is
likely to, incur any liability in connection with a withdrawal from,
or the insolvency, bankruptcy or reorganization of, a Multiemployer
Plan and in each case in clauses (i) through (v) above, (x) a period
of sixty (60) days, or more, has elapsed from the occurrence of such
event or condition and (y) such event or condition, together with all
other such events or conditions, if any, could reasonably be expected
to have a material adverse effect upon the Company and its
Subsidiaries, taken as a whole;
(k) (i) any Person or "group" (within the meaning of
Section 13(d) or 14(d) of the Securities Exchange Act of 1934, as
amended), other than the Current Shareholder and Management Group,
shall either (i) acquire beneficial ownership of more than fifty
percent (50%) of any outstanding class of common stock of the Company
having ordinary voting power in the election of the directors of the
Company or (ii) obtain the power (whether or not exercised) to elect a
majority of the Company's board of directors; or (ii) the board of
directors of the Company shall not consist of a majority of Continuing
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Directors; or (iii) a "Change in Control" shall occur under the
Existing Senior Debt Documents or the New Senior Debt Documents, as
the case may be, or the Company has issued any "Change of Control
Notice" or "Control Change" Notice hereunder; and
(l) if a receiver, liquidator, custodian or trustee of
the Company, any Guarantor, any Permitted Borrower or any Significant
Subsidiary, or of all or any part of the property of the Company, any
Guarantor, any Permitted Borrower or any Significant Subsidiary, shall
be appointed by court order and such order shall remain in effect for
more than sixty (60) days, or an order for relief shall be entered
with respect to the Company, any Guarantor, any Permitted Borrower or
any Significant Subsidiary, or the Company or any Subsidiary shall be
adjudicated a bankrupt or insolvent; or any of the property of the
Company, any Guarantor, any Permitted Borrower or any Significant
Subsidiary shall be sequestered by court order and such order shall
remain in effect for more than sixty (60) days; or a petition shall be
filed against the Company, any Guarantor, any Permitted Borrower or
any Significant Subsidiary under any bankruptcy, reorganization,
arrangement, insolvency, readjustment of debt, dissolution or
liquidation law of any jurisdiction, whether now or hereafter in
effect, and shall not be dismissed within sixty (60) days after such
filing; or if the Company, any Guarantor, any Permitted Borrower or
any Significant Subsidiary shall file a petition in voluntary
bankruptcy or seeking relief under any provision of any bankruptcy,
reorganization, arrangement, insolvency, readjustment of debt,
dissolution or liquidation law of any jurisdiction, whether now or
hereafter in effect, or shall consent to the filing of any petition
against it under any such law; or if the Company, any Guarantor, any
Permitted Borrower or any Significant Subsidiary shall make an
assignment for the benefit of its creditors, or shall admit in writing
its inability, or shall fail, to pay its debts generally as they
become due, or shall consent to the appointment of a receiver,
liquidator or trustee of the Company, any Guarantor, any Permitted
Borrower or any Significant Subsidiary or of all or any part of the
property of the Company, any Guarantor, any Permitted Borrower or any
Significant Subsidiary.
10.2 Exercise of Remedies. If an Event of Default has occurred and
is continuing hereunder: (a) the Agent shall, if directed to do so by the
Majority Banks, declare any commitment of the Banks (including the Swing Line
Bank) to lend hereunder immediately terminated; (b) the Agent shall, if
directed to do so by the Majority Banks, declare the entire unpaid principal
Indebtedness, including the Notes, immediately due and payable, without
presentment, notice or demand, all of which are hereby expressly waived by
Company and each of the Permitted Borrowers; (c) upon the
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occurrence of any Event of Default specified in subsection 10.1 (l), above, and
notwithstanding the lack of any declaration by Agent under preceding clause
(b), the entire unpaid principal Indebtedness, including the Notes, shall
become automatically due and payable; (d) the Agent shall, upon being directed
to do so by the Majority Banks, demand immediate delivery of cash collateral,
and the Company and each Account Party agrees to deliver such cash collateral
upon demand, in an amount equal to the maximum amount that may be available to
be drawn at any time prior to the stated expiry of all outstanding Letters of
Credit, and (e) the Agent shall, if directed to do so by the Majority Banks or
the Banks, as applicable (subject to the terms hereof), exercise any remedy
permitted by this Agreement, the other Loan Documents or law.
10.3 Rights Cumulative. No delay or failure of Agent and/or Banks
in exercising any right, power or privilege hereunder shall affect such right,
power or privilege, nor shall any single or partial exercise thereof preclude
any other or further exercise thereof, or the exercise of any other power,
right or privilege. The rights of Banks under this Agreement are cumulative and
not exclusive of any right or remedies which Banks would otherwise have.
10.4 Waiver by Company and the Permitted Borrowers of Certain Laws.
To the extent permitted by applicable law, Company and the Permitted Borrower
hereby agree to waive, and do hereby absolutely and irrevocably waive and
relinquish the benefit and advantage of any valuation, stay, appraisement,
extension or redemption laws now existing or which may hereafter exist, which,
but for this provision, might be applicable to any sale made under the
judgment, order or decree of any court, on any claim for interest on the Notes,
AND FURTHER HEREBY IRREVOCABLY AGREE TO WAIVE THE RIGHT TO TRIAL BY JURY WITH
RESPECT TO ANY AND ALL ACTIONS OR PROCEEDINGS IN WHICH AGENT OR THE BANKS (OR
ANY OF THEM), ON ONE HAND, AND THE COMPANY OR THE PERMITTED BORROWER, ON THE
OTHER HAND, ARE PARTIES, WHETHER OR NOT SUCH ACTIONS OR PROCEEDINGS ARISE OUT
OF THIS AGREEMENT OR THE OTHER LOAN DOCUMENTS, OR OTHERWISE. These waivers have
been voluntarily given, with full knowledge of the consequences thereof.
10.5 Waiver of Defaults. No Event of Default shall be waived by the
Banks except in a writing signed by an officer of the Agent in accordance with
Section 13.14 hereof. No single or partial exercise of any right, power or
privilege hereunder, nor any delay in the exercise thereof, shall preclude
other or further exercise of the Banks' rights by Agent. No waiver of any Event
of Default shall extend to any other or further Event of Default. No
forbearance on the part of the Agent in enforcing any of the Banks' rights
shall constitute a waiver of any of their rights. Company and each of the
Permitted Borrowers expressly agree that this Section may not be waived or
modified by the Banks or Agent by course of performance, estoppel or otherwise.
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11. PAYMENTS, RECOVERIES AND COLLECTIONS.
11.1 Payment Procedure.
(a) All payments by Company and/or by the Permitted
Borrowers of principal of, or interest on, the Revolving Credit Notes,
the Swing Line Note, any Term Notes or of Fees shall be made without
setoff or counterclaim on the date specified for payment under this
Agreement not later than 12:00 noon (Detroit time) in Dollars in
immediately available funds to Agent, for the ratable account of the
Banks, at Agent's office located at One Detroit Center, Detroit,
Michigan 48226, in respect of Domestic Advances. Payments made in
respect of any Advance in any Alternative Currency shall be made in
such Alternative Currency in immediately available funds for the
account of Agent's Eurocurrency Lending Office, at the Agent's
Correspondent, for the ratable account of the Banks, not later than
12:00 noon (the time of Agent's Correspondent). Upon receipt of each
such payment, the Agent shall make prompt payment to each Bank, or, in
respect of Eurocurrency-based Advances, such Bank's Eurocurrency
Lending Office, in like funds and currencies, of all amounts received
by it for the account of such Bank.
(b) Unless the Agent shall have been notified by the
Company prior to the date on which any payment to be made by the
Company or a Permitted Borrower is due that the Company or such
Permitted Borrower does not intend to remit such payment, the Agent
may, in its discretion, assume that the Company or the applicable
Permitted Borrower has remitted such payment when so due and the Agent
may, in reliance upon such assumption, make available to each Bank on
such payment date an amount equal to such Bank's share of such assumed
payment. If the Company or such Permitted Borrower has not in fact
remitted such payment to the Agent, each Bank shall forthwith on
demand repay to the Agent in the applicable currency the amount of
such assumed payment made available to such Bank, together with the
interest thereon, in respect of each day from and including the date
such amount was made available by the Agent to such Bank to the date
such amount is repaid to the Agent at a rate per annum equal to (i)
for Domestic Advances, the Federal Funds Effective Rate, as the same
may vary from time to time, and (ii) with respect to
Eurocurrency-based Advances or Advances in any Alternative Currency,
Agent's aggregate marginal cost (including the cost of maintaining any
required reserves or deposit insurance and of any fees, penalties,
overdraft charges or other costs or expenses incurred by Agent) of
carrying such amount.
(c) Whenever any payment to be made hereunder (other
than payments in respect of any Eurocurrency-based Advance) shall
otherwise be due on a day which is not a Business Day,
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such payment shall be made on the next succeeding Business Day and
such extension of time shall be included in computing interest, if
any, in connection with such payment. Whenever any payment of
principal of, or interest on, a Eurocurrency-based Advance shall be
due on a day which is not a Business Day the date of payment thereof
shall be extended to the next succeeding Business Day unless as a
result thereof it would fall in the next calendar month, in which case
it shall be shortened to the next preceding Business Day and, in the
case of a payment of principal, interest thereon shall be payable for
such extended or shortened time, if any.
(d) All payments to be made by the Company or any of the
Permitted Borrowers under this Agreement or any of the Notes
(including without limitation payments under the Swing Line Note)
shall be made without set-off or counterclaim, as aforesaid, and
without deduction for or on account of any present or future
withholding or other taxes of any nature imposed by any governmental
authority or of any political subdivision thereof or any federation or
organization of which such governmental authority may at the time of
payment be a member, unless Company or the applicable Permitted
Borrower, as the case may be, is compelled by law to make payment
subject to such tax. In such event, Company and the applicable
Permitted Borrower shall:
(i) pay to the Agent for Agent's own account
and/or, as the case may be, for the account
of the Banks (and, in the case of any Swing
Line Advances, pay to the Swing Line Bank
which funded such Advances) such additional
amounts as may be necessary to ensure that
the Agent and/or such Bank or Banks receive a
net amount in the applicable Permitted
Currency equal to the full amount which would
have been receivable had payment not been
made subject to such tax; and
(ii) remit such tax to the relevant taxing
authorities according to applicable law, and
send to the Agent or the applicable Bank
(including the Swing Line Bank) or Banks, as
the case may be, such certificates or
certified copy receipts as the Agent or such
Bank or Banks shall reasonably require as
proof of the payment by the Company or the
applicable Permitted Borrower of any such
taxes payable by the Company or the
applicable Permitted Borrower.
As used herein, the terms "tax", "taxes" and "taxation" include all
existing taxes, levies, imposts, duties, charges, fees,
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deductions and withholdings and any restrictions or conditions resulting in a
charge together with interest thereon and fines and penalties with respect
thereto which may be imposed by reason of any violation or default with respect
to the law regarding such tax, assessed as a result of or in connection with
the transactions in any Alternative Currency hereunder, or the payment and or
receipt of funds in any Alternative Currency hereunder, or the payment or
delivery of funds into or out of any jurisdiction other than the United States
(whether assessed against Company, any of the Permitted Borrowers, Agent or any
of the Banks).
11.2 Application of Proceeds. Notwithstanding anything to the
contrary in this Agreement, after an Event of Default, the proceeds of any
offsets, voluntary payments by the Company or any of the Permitted Borrowers or
others and any other sums received or collected in respect of the Indebtedness,
shall be applied, first, to the Notes in such order and manner as determined by
the Majority Banks (subject, however, to the applicable Percentages of the
Indebtedness held by each of the Banks), next, to any other Indebtedness on a
pro rata basis, and then, if there is any excess, to the Company or the
Permitted Borrowers, as the case may be. The application of such proceeds and
other sums to the Notes shall be based on each Bank's Percentage of the
aggregate Indebtedness.
11.3 Pro-rata Recovery. If any Bank shall obtain any payment or
other recovery (whether voluntary, involuntary, by application of offset or
otherwise) on account of principal of, or interest on, any of the Notes in
excess of its pro rata share of payments then or thereafter obtained by all
Banks upon principal of and interest on all Notes, such Bank shall purchase
from the other Banks such participations in the Notes held by them as shall be
necessary to cause such purchasing Bank to share the excess payment or other
recovery ratably in accordance with the Percentages with each of them;
provided, however, that if all or any portion of the excess payment or other
recovery is thereafter recovered from such purchasing holder, the purchase
shall be rescinded and the purchase price restored to the extent of such
recovery, but without interest.
11.4 Deposits and Accounts. In addition to and not in limitation of
any rights of any Bank or other holder of any of the Notes under applicable
law, each Bank and each other such holder shall, upon acceleration of the
indebtedness under the Notes and without notice or demand of any kind, have the
right to set-off, appropriate and apply to the payment of the Notes owing to it
(whether or not then due) any and all balances, credits, deposits, accounts or
moneys of Company or any of the Permitted Borrowers then or thereafter with
such Bank or other holder; provided, however, that any such amount so applied
by any Bank or other holder on any of the Notes owing to it shall be subject to
the provisions of Section 11.3 hereof.
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12. CHANGES IN LAW OR CIRCUMSTANCES; INCREASED COSTS.
12.1 Reimbursement of Prepayment Costs. If Company or any of the
Permitted Borrowers makes any payment of principal with respect to any
Eurocurrency-based Advance or Quoted Rate Advance on any day other than the
last day of the Interest Period applicable thereto (whether voluntarily, by
acceleration, or otherwise) or converts or refunds, (or attempt to convert or
refund) any such Advance, or if Company or any of the Permitted Borrowers fails
to borrow, refund or convert any Eurocurrency-based Advance or Quoted Rate
Advance after notice has been given by Company or such Permitted Borrower to
Agent in accordance with the terms hereof requesting such Advance, or if
Company or any of the Permitted Borrowers fails to make any payment of
principal or interest in respect of a Eurocurrency-based Advance or Quoted Rate
Advance when due, Company and the applicable Permitted Borrower shall reimburse
Agent and Banks, as the case may be on demand for any resulting loss, cost or
expense incurred by Agent and Banks, as the case may be as a result thereof,
including, without limitation, any such loss, cost or expense incurred in
obtaining, liquidating, employing or redeploying deposits from third parties,
whether or not Agent and Banks, as the case may be, shall have funded or
committed to fund such Advance, but excluding loss of the Applicable Margin.
Such amount payable by Company and the applicable Permitted Borrower to Agent
and Banks, as the case may be may include, without limitation, an amount equal
to the excess, if any, of (a) the amount of interest which would have accrued
on the amount so prepaid, or not so borrowed, refunded or converted, for the
period from the date of such prepayment or of such failure to borrow, refund or
convert, through the last day of the relevant Interest Period, at the
applicable rate of interest for said Advance(s) provided under this Agreement
(excluding the Applicable Margin, if any), over (b) the amount of interest (as
reasonably determined by Agent and Banks, as the case may be) which would have
accrued to Agent and Banks, as the case may be, on such amount by placing such
amount on deposit for a comparable period with leading banks in the interbank
eurocurrency market. Calculation of any amounts payable to any Bank under this
paragraph shall be made as though such Bank shall have actually funded or
committed to fund the relevant Advance through the purchase of an underlying
deposit in an amount equal to the amount of such Advance and having a maturity
comparable to the relevant Interest Period; provided, however, that any Bank
may fund any Eurocurrency-based Advance or Quoted Rate Advance in any manner it
deems fit and the foregoing assumptions shall be utilized only for the purpose
of the calculation of amounts payable under this paragraph. Upon the written
request of Company, Agent and Banks shall deliver to Company a certificate
setting forth in reasonable detail the basis for determining such losses, costs
and expenses, which certificate shall be presumed correct, absent demonstrable
error.
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12.2 Eurocurrency Lending Office. For any Advance in any
Alternative Currency or to which the Eurocurrency-based Rate is applicable, if
Agent or a Bank, as applicable, shall designate a Eurocurrency Lending Office
which maintains books separate from those of the rest of Agent or such Bank,
Agent or such Bank, as the case may be, shall have the option of maintaining
and carrying the relevant Advance on the books of such Eurocurrency Lending
Office.
12.3 Availability of Alternative Currency. The Agent and the Banks
shall not be required to make any Advance requested to be made in an
Alternative Currency if, at any time prior to making such Advance, the Agent or
the Banks (after consultation with Agent) shall determine, in its or their sole
discretion, that (i) deposits in the applicable Alternative Currency in the
amounts and maturities required to fund such Advance will not be available to
the Agent and the Banks; (ii) a fundamental change has occurred in the foreign
exchange or interbank markets with respect to the applicable Alternative
Currency (including, without limitation, changes in national or international
financial, political or economic conditions or currency exchange rates or
exchange controls); or (iii) it has become otherwise materially impracticable
for the Agent or the Banks, as applicable, to make such Advance in the
applicable Alternative Currency. The Agent or the applicable Bank, as the case
may be, shall promptly notify the Company and Banks of any such determination.
12.4 Refunding Advances in Same Currency. If pursuant to any
provisions of this Agreement, the Company or any of the Permitted Borrowers
repays one or more Advances and on the same day borrows an amount in the same
currency, the Agent (or the Swing Line Bank, in the case of a Swing Line
Advance) shall apply the proceeds of such new borrowing to repay the principal
of the Advance or Advances being repaid and only an amount equal to the
difference (if any) between the amount being borrowed and the amount being
repaid shall be remitted by the Agent to the Company or the applicable
Permitted Borrower, or by the Company or the applicable Permitted Borrower to
the Agent, as the case may be.
12.5 Circumstances Affecting Eurocurrency-based Rate or Alternative
Currency Availability. If with respect to any Interest Period Agent or the
Banks (after consultation with Agent) shall determine that, by reason of
circumstances affecting the foreign exchange and interbank markets generally,
deposits in eurodollars or in any applicable Alternative Currency, as the case
may be, in the applicable amounts are not being offered to the Agent or such
Bank for such Interest Period, then Agent shall forthwith give notice thereof
to the Company and the applicable Permitted Borrower. Thereafter, until Agent
notifies Company and the applicable Permitted Borrower that such circumstances
no longer exist, (i) the obligation of Banks to make Eurocurrency-based
Advances (other than in any applicable Alternative Currency with respect to
which deposits are available, as required hereunder),
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and the right of Company or any Permitted Borrower to convert an Advance to or
refund an Advance as a Eurocurrency-based Advance, as the case may be (other
than in any applicable Alternative Currency with respect to which deposits are
available, as required hereunder), shall be suspended, and (ii) the Company and
the applicable Permitted Borrower shall repay in full (or cause to be repaid in
full) the then outstanding principal amount of each such Eurocurrency-based
Advance covered hereby in the applicable Permitted Currency, together with
accrued interest thereon, any amounts payable under Sections 12.1 and 12.6,
hereof, and all other amounts payable hereunder on the last day of the then
current Interest Period applicable to such Advance. Upon the date for repayment
as aforesaid and unless Company or the applicable Permitted Borrower notifies
Agent to the contrary within two (2) Business Days after receiving a notice
from Agent pursuant to this Section, such outstanding principal amount shall be
converted to a Prime-based Advance (based on the Current Dollar Equivalent of
any Advance denominated in an Alternative Currency) as of the last day of such
Interest Period.
12.6 Laws Affecting Eurocurrency-based or Alternative Currency
Advance Availability. If, after the date hereof, the introduction of, or any
change in, any applicable law, rule or regulation or in the interpretation or
administration thereof by any governmental authority charged with the
interpretation or administration thereof, or compliance by any of the Banks (or
any of their respective Eurocurrency Lending Offices) with any request or
directive (whether or not having the force of law) of any such authority, shall
make it unlawful or impossible for any of the Banks (or any of their respective
Eurocurrency Lending Offices) to honor its obligations hereunder to make or
maintain any Advance with interest at the Eurocurrency-based Rate or in an
Alternative Currency, such Bank shall forthwith give notice thereof to Company
and to Agent. Thereafter, (a) the obligations of Banks to make
Eurocurrency-based Advances or Advances in any such Alternative Currency and
the right of Company to convert an Advance into or refund an Advance as a
Eurocurrency-based Advance or as an Advance in any such Alternative Currency
shall be suspended and thereafter Company may select as Applicable Interest
Rates or as Alternative Currencies only those which remain available and which
are permitted to be selected hereunder, and (b) if any of the Banks may not
lawfully continue to maintain an Advance to the end of the then current
Interest Period applicable thereto as a Eurocurrency-based Advance or in such
Alternative Currency, the applicable Advance shall immediately be converted to
a Prime-based Advance (based on the Current Dollar Equivalent of any Advances
denominated in any Alternative Currency) and the Prime-based Rate shall be
applicable thereto for the remainder of such Interest Period. For purposes of
this Section, a change in law, rule, regulation, interpretation or
administration shall include, without limitation, any change made or which
becomes effective on the basis of a law, rule, regulation, interpretation or
administration presently in force, the effective
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date of which change is delayed by the terms of such law, rule, regulation,
interpretation or administration.
12.7 Increased Cost of Eurocurrency-based or Alternative Currency
Advances. If the adoption after the date hereof, or any change after the date
hereof in, any applicable law, rule or regulation of or in the interpretation
or administration thereof by any governmental authority, central bank or
comparable agency charged with the interpretation or administration thereof, or
compliance by Agent or any of the Banks (or any of their respective
Eurocurrency Lending Offices) with any request or directive (whether or not
having the force of law) made by any such authority, central bank or comparable
agency after the date hereof:
(a) shall subject any of the Banks (or any of their
respective Eurocurrency Lending Offices) to any tax, duty or other
charge with respect to any Advance or any Note or shall change the
basis of taxation of payments to any of the Banks (or any of their
respective Eurocurrency Lending Offices) of the principal of or
interest on any Advance or any Note or any other amounts due under
this Agreement in respect thereof (except for changes in the rate of
tax on the overall net income of any of the Banks or any of their
respective Eurocurrency Lending Offices imposed by the jurisdiction in
which such Bank's principal executive office or Eurocurrency Lending
Office is located); or
(b) shall impose, modify or deem applicable any reserve
(including, without limitation, any imposed by the Board of Governors
of the Federal Reserve System), special deposit or similar requirement
against assets of, deposits with or for the account of, or credit
extended by any of the Banks (or any of their respective Eurocurrency
Lending Offices) or shall impose on any of the Banks (or any of their
respective Eurocurrency Lending Offices) or the foreign exchange and
interbank markets any other condition affecting any Advance or any of
the Notes;
and the result of any of the foregoing is to increase the costs to any of the
Banks of maintaining any part of the Indebtedness hereunder as a
Eurocurrency-based Advance or as an Advance in any Alternative Currency or to
reduce the amount of any sum received or receivable by any of the Banks under
this Agreement or under the Notes in respect of a Eurocurrency-based Advance or
any Advance in an Alternative Currency, whether with respect to Advances to
Company or to any of the Permitted Borrowers, then such Bank shall promptly
notify Agent (or, in the case of a Swing Line Advance, shall notify Company and
the applicable Permitted Borrower directly, with a copy of such notice to
Agent), and Agent (or such Bank, as aforesaid) shall promptly notify Company
and the applicable Permitted Borrower of such fact and demand compensation
therefor and, within thirty (30) days after such notice, Company
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and the applicable Permitted Borrowers agree to pay to such Bank such
additional amount or amounts as will compensate such Bank or Banks for such
increased cost or reduction. Agent will promptly notify Company and the
applicable Permitted Borrower of any event of which it has knowledge which will
entitle Banks to compensation pursuant to this Section, or which will cause
Company or Permitted Borrower to incur additional liability under Sections 12.1
and 12.8 hereof, provided that Agent shall incur no liability whatsoever to the
Banks, Company or any of the Permitted Borrowers in the event it fails to do
so. A certificate of Agent (or such Bank, if applicable) setting forth in
reasonable detail the basis for determining such additional amount or amounts
necessary to compensate such Bank or Banks shall be presumed to be correct,
save for demonstrable error. For purposes of this Section, a change in law,
rule, regulation, interpretation, administration, request or directive shall
include, without limitation, any change made or which becomes effective on the
basis of a law, rule, regulation, interpretation, administration, request or
directive presently in force, the effective date of which change is delayed by
the terms of such law, rule, regulation, interpretation, administration,
request or directive.
12.8 Indemnity. The Company and each of the Permitted Borrowers
will indemnify Agent and each of the Banks against any loss or expense which
may arise or be attributable to the Agent's and each Bank's obtaining,
liquidating or employing deposits or other funds acquired to effect, fund or
maintain the Advances (a) as a consequence of any failure by the Company or the
applicable Permitted Borrower to make any payment when due of any amount due
hereunder in connection with a Eurocurrency-based Advance or Advance in any
Alternative Currency, (b) due to any failure of the Company or the applicable
Permitted Borrower to borrow, refund or convert on a date specified therefor in
a Request for Advance or request for Swing Line Advance or (c) due to any
payment, prepayment or conversion of any Eurocurrency-based Advance or Advance
in any Alternative Currency on a date other than the last day of the Interest
Period for such Advance. Such loss or expense shall be calculated based upon
the present value, as applicable, of payments due from the Company or the
applicable Permitted Borrower with respect to a deposit obtained by the Agent
or any of the Banks in order to fund such Advance to the Company or to the
applicable Permitted Borrower. The Agent's and each Bank's, as applicable,
calculations of any such loss or expense shall be furnished to the Company in
reasonable detail and shall be presumed correct, absent demonstrable error.
12.9 Judgment Currency. The obligation of the Company and Permitted
Borrowers to make payments of the principal of and interest on the Notes and
any other amounts payable hereunder in the currency specified for such payment
herein or in the Notes shall not be discharged or satisfied by any tender, or
any recovery pursuant to any judgment, which is expressed in or converted into
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any other currency, except to the extent that such tender or recovery shall
result in the actual receipt by each of the Banks of the full amount of the
particular Permitted Currency expressed to be payable herein or in the Notes.
The Agent (or the Swing Line Bank, as applicable) shall, using all amounts
obtained or received from the Company and from the Permitted Borrowers pursuant
to any such tender or recovery in payment of principal of and interest on the
Notes, promptly purchase the applicable Permitted Currency at the most
favorable spot exchange rate determined by the Agent (or the Swing Line Bank,
as applicable) to be available to it. The obligation of the Company and the
Permitted Borrowers to make payments in the applicable Permitted Currency shall
be enforceable as an alternative or additional cause of action solely for the
purpose of recovering in the applicable Permitted Currency the amount, if any,
by which such actual receipt shall fall short of the full amount of the
Permitted Currency expressed to be payable herein or in the Notes.
12.10 Other Increased Costs. In the event that at any time after
the date of this Agreement any change in law such as described in Section 12.7
hereof, shall require that the Revolving Credit, the Swing Line, the Banks'
commitments to fund Term Loans hereunder or any other Indebtedness or
commitment under this Agreement or any of the other Loan Documents be treated
as an asset or otherwise be included for purposes of calculating the
appropriate amount of capital to be maintained by each of the Banks or any
corporation controlling such Banks, as the case may be, the Agent, in
consultation with the Banks, shall notify the Company. The Company and the
Agent shall thereafter negotiate in good faith an agreement to increase the
Revolving Credit Commitment Fee or other fees payable to the Agent, for the
benefit of the Banks under this Agreement, which in the opinion of the Agent
(in consultation with the Banks), will adequately compensate the Banks for the
costs associated with such change in law. If such increase is approved in
writing by the Company within thirty (30) days from the date of the notice to
the Company from the Agent, the Revolving Credit Commitment Fee or other fees
(if applicable) payable by the Company under this Agreement shall, effective
from the date of such agreement, include the amount of such agreed increase. If
the Company and the Agent are unable to agree on such an increase within thirty
(30) days from the date of the notice to the Company, the Company shall have
the option, exercised by written notice to the Agent within forty-five (45)
days from the date of the aforesaid notice to the Company from the Agent, to
terminate the Revolving Credit, the Swing Line or any commitments to fund Term
Loans hereunder, as the case may be, or other commitments if applicable, in
which event, all sums then outstanding to Banks and to Agent hereunder shall be
due and payable in full. If (a) the Company and the Agent (in consultation with
the Banks) fail to agree on an increase in the Revolving Credit Commitment Fee
or other fees (if applicable) or (b) the Company fails to give timely notice
that it has elected to exercise its option to terminate the
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Revolving Credit, the Swing Line or any commitments to fund Term Loans
hereunder or other commitments, if applicable, as set forth above, then the
Revolving Credit, the Swing Line or any commitments to fund Term Loans
hereunder and/or such other commitments shall automatically terminate as of the
last day of the aforesaid forty-five (45) day period, in which event all sums
then outstanding to Banks and to Agent hereunder shall be due and payable in
full.
13. AGENT
13.1 Appointment of Agent. Each Bank and the holder of each Note
appoints and authorizes Agent to act on behalf of such Bank or holder under the
Loan Documents and to exercise such powers hereunder and thereunder as are
specifically delegated to or required of Agent by the terms hereof and thereof,
together with such powers as may be reasonably incidental thereto. Each Bank
agrees (which agreement shall survive any termination of this Agreement) to
reimburse Agent for all reasonable out-of-pocket expenses (including in-house
and outside attorneys' fees) incurred by Agent hereunder or in connection
herewith or with an Event of Default or in enforcing the obligations of Company
or any of the Permitted Borrowers under this Agreement or the other Loan
Documents or any other instrument executed pursuant hereto, and for which Agent
is not reimbursed by Company or any of Permitted Borrowers, pro rata according
to such Bank's Percentage, but excluding any such expenses resulting from
Agent's gross negligence or willful misconduct. Agent shall not be required to
take any action under the Loan Documents, or to prosecute or defend any suit in
respect of the Loan Documents, unless indemnified to its satisfaction by the
Banks against loss, costs, liability and expense (excluding liability resulting
from its gross negligence or willful misconduct). If any indemnity furnished to
Agent shall become impaired, it may call for additional indemnity and cease to
do the acts indemnified against until such additional indemnity is given.
13.2 Deposit Account with Agent. Company and each of the Permitted
Borrowers may, by written notice to Agent, authorize Agent to charge their
respective general deposit accounts, if any, maintained with Agent for the
amount of any principal, interest, or other amounts or costs due under this
Agreement when the same shall become due and payable under the terms of this
Agreement or the Notes.
13.3 Exculpatory Provisions. Agent agrees to exercise its rights
and powers, and to perform its duties, as Agent hereunder and under the other
Loan Documents in accordance with its usual customs and practices in
bank-agency transactions, but only upon and subject to the express terms and
conditions of this Section 13 (and no implied covenants or other obligations
shall be read into this Agreement against the Agent); neither Agent nor any of
its directors, officers, employees or agents shall be liable to any
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Bank for any action taken or omitted to be taken by it or them under this
Agreement or any document executed pursuant hereto, or in connection herewith
or therewith, except for its or their own willful misconduct or gross
negligence, nor be responsible for any recitals or warranties herein or
therein, or for the effectiveness, enforceability, validity or due execution of
this Agreement or any document executed pursuant hereto, or any security
thereunder, or to make any inquiry respecting the performance by Company, any
of its Subsidiaries or the Permitted Borrowers of their respective obligations
hereunder or thereunder. Nor shall Agent have, or be deemed to have, a
fiduciary relationship with any Bank by reason of this Agreement. Agent shall
be entitled to rely upon advice of counsel concerning legal matters and upon
any notice, consent, certificate, statement or writing which it believes to be
genuine and to have been presented by a proper person.
13.4 Successor Agents. Agent may resign as such at any time upon
at least 30 days prior notice to Company and all Banks. If Agent at any time
shall resign or if the office of Agent shall become vacant for any other
reason, Majority Banks shall, by written instrument, appoint a successor Agent
(consisting of Co-Agent, or of any other Bank or financial institution
satisfactory to such Majority Banks and, provided that no Default or Event of
Default has occurred and is continuing, to Company, such approval of Company
not to be unreasonably withheld or delayed) which shall thereupon become Agent
hereunder and shall be entitled to receive from the prior Agent such documents
of transfer and assignment as such successor Agent may reasonably request. Such
successor Agent shall succeed to all of the rights and obligations of the
retiring Agent as if originally named. The retiring Agent shall duly assign,
transfer and deliver to such successor Agent all moneys at the time held by the
retiring or removed Agent hereunder after deducting therefrom its expenses for
which it is entitled to be reimbursed. Upon such succession of any such
successor Agent, the retiring agent shall be discharged from its duties and
obligations hereunder, except for its gross negligence or willful misconduct
arising prior to its retirement hereunder, and the provisions of this Section
13 shall continue in effect for its benefit in respect of any actions taken or
omitted to be taken by it while it was acting as Agent.
13.5 Loans by Agent. Agent shall have the same rights and powers
with respect to the credit extended by it and the Notes held by it as any Bank
and may exercise the same as if it were not Agent, and the term "Bank" and,
when appropriate, "holder" shall include Agent in its individual capacity.
13.6 Credit Decisions. Each Bank acknowledges that it has,
independently of Agent and each other Bank and based on the financial
statements of Company, the Permitted Borrowers and their respective
Subsidiaries and such other documents, information and investigations as it has
deemed appropriate, made its own credit
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decision to extend credit hereunder from time to time. Each Bank also
acknowledges that it will, independently of Agent and each other Bank and based
on such other documents, information and investigations as it shall deem
appropriate at any time, continue to make its own credit decisions as to
exercising or not exercising from time to time any rights and privileges
available to it under this Agreement or any document executed pursuant hereto.
13.7 Notices by Agent. Agent shall give prompt notice to each Bank
of its receipt of each notice or request required or permitted to be given to
Agent by Company or any of the Permitted Borrowers pursuant to the terms of
this Agreement and shall promptly distribute to the Banks any reports received
from the Company or any of its Subsidiaries or the Permitted Borrowers under
the terms hereof, or other material information or documents received by Agent,
in its capacity as Agent, from the Company, its Subsidiaries or the Permitted
Borrowers.
13.8 Agent's Fees. Commencing on August 1, 1996 and on each
succeeding anniversary date thereof until the Indebtedness has been repaid and
no commitment to fund any loan hereunder is outstanding, the Company and the
Permitted Borrowers, jointly and severally, shall pay to Agent an annual agency
fee set forth (or to be set forth from time to time) in a letter agreement
between or among Company, Permitted Borrowers and Agent. The Agent's Fees
described in this Section 13.8 shall not be refundable under any circumstances.
13.9 Nature of Agency. The appointment of Agent as agent hereunder
is for the convenience of Banks, Company and the Permitted Borrowers in making
Advances of the Revolving Credit, the Swing Line, Term Loans and any other
Indebtedness of Company or the Permitted Borrowers hereunder, and collecting
fees and principal and interest on the Indebtedness. No Bank is purchasing any
Indebtedness from Agent and this Agreement is not intended to be, and shall not
constitute, a purchase or participation agreement.
13.10 Actions; Confirmation of Agent's Authority to Act in Event of
Default. Subject to the terms and conditions of this Agreement, Agent is hereby
expressly authorized to act in all litigation by or against Agent and in all
other respects as the representative of the Banks where Agent considers it to
be necessary or desirable in order to carry out the purposes of this Agreement
or the other Loan Documents. Without necessarily accepting service of process
or designating Agent to do so in its stead, each Bank hereby agrees with each
other Bank and with Agent, without intending to confer or conferring any rights
on any other party, (a) that it shall be bound by any litigation brought by or
against Agent by the Company, any Subsidiary, any of the Permitted Borrowers or
any other party in connection with the Indebtedness or any other rights, duties
or obligations arising hereunder or under this Agreement or the other Loan
Documents and (b) that it now
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irrevocably waives the defense of procedural impediment or failure to name or
join such Bank as an indispensable party. In conducting such litigation
hereunder on behalf of the Banks, Agent shall at all times be indemnified by
the Banks as provided in Sections 13.1 and 13.12 hereof. Agent shall undertake
to give each Bank prompt written notice of any litigation commenced against
Agent and/or the Banks with respect to this Agreement or the other Loan
Documents or any matter referred to herein or therein.
13.11 Authority of Agent to Enforce Notes and This Agreement. Each
Bank, subject to the terms and conditions of this Agreement, authorizes the
Agent with full power and authority as attorney-in-fact to institute and
maintain actions, suits or proceedings for the collection and enforcement of
the Notes, this Agreement and the other Loan Documents and to file such proofs
of debt or other documents as may be necessary to have the claims of the Banks
allowed in any proceeding relative to the Company, any of its Subsidiaries, any
of the Permitted Borrowers or each such party's creditors or affecting each
such party's properties, and to take such other actions which Agent considers
to be necessary or desirable for the protection, collection and enforcement of
the Notes, this Agreement or the other Loan Documents.
13.12 Indemnification. The Banks agree to indemnify the Agent in
its capacity as such, to the extent not reimbursed by the Company or the
Permitted Borrowers, pro rata according to their respective Percentages, from
and against any and all claims, liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or disbursements of any
kind or nature whatsoever which may be imposed on, incurred by, or asserted
against the Agent in any way relating to or arising out of this Agreement or
any of the other Loan Documents or any action taken or omitted to be taken or
suffered in good faith by the Agent hereunder, provided that no Bank shall be
liable for any portion of any of the foregoing items resulting from the gross
negligence or willful misconduct of the Agent or any of its officers,
employees, directors or agents.
13.13 Knowledge of Default. It is expressly understood and agreed
that the Agent shall be entitled to assume that no Default or Event of Default
has occurred and is continuing, unless the officers of the Agent immediately
responsible for matters concerning this Agreement shall have actual (rather
than constructive) knowledge of such occurrence or shall have been notified in
writing by a Bank that such Bank considers that a Default or an Event of
Default has occurred and is continuing, and specifying the nature thereof. Upon
obtaining actual knowledge of any Default or Event of Default as described
above, the Agent shall promptly, but in any event within three (3) Business
Days after obtaining knowledge thereof, notify each Bank of such Default or
Event of Default and the action, if any, the Agent proposes be taken with
respect thereto.
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13.14 Agent's Authorization; Action by Banks. Except as otherwise
expressly provided herein, whenever the Agent is authorized and empowered
hereunder on behalf of the Banks to give any approval or consent, or to make
any request, or to take any other action on behalf of the Banks (including
without limitation the exercise of any right or remedy hereunder or under the
other Loan Documents), the Agent shall be required to give such approval or
consent, or to make such request or to take such other action only when so
requested in writing by the Majority Banks or the Banks, as applicable
hereunder. Action that may be taken by Majority Banks or all of the Banks, as
the case may be (as provided for hereunder), may be taken (i) pursuant to a
vote at a meeting (which may be held by telephone conference call) as to which
all of the Banks have been given reasonable advance notice, or (ii) pursuant to
the written consent of the requisite Percentages of the Banks as required
hereunder, provided that all of the Banks are given reasonable advance notice
of the requests for such consent.
13.15 Enforcement Actions by the Agent. Except as otherwise
expressly provided under this Agreement or in any of the other Loan Documents
and subject to the terms hereof, Agent will take such action, assert such
rights and pursue such remedies under this Agreement and the other Loan
Documents as the Majority Banks or all of the Banks, as the case may be (as
provided for hereunder), shall direct. Except as otherwise expressly provided
in any of the Loan Documents, Agent will not (and will not be obligated to)
take any action, assert any rights or pursue any remedies under this Agreement
or any of the other Loan Documents in violation or contravention of any express
direction or instruction of the Majority Banks or all of the Banks, as the case
may be (as provided for hereunder). Agent may refuse (and will not be
obligated) to take any action, assert any rights or pursue any remedies under
this Agreement or any of the other Loan Documents in the absence of the express
written direction and instruction of the Majority Banks or all of the Banks, as
the case may be (as provided for hereunder). In the event Agent fails, within
a commercially reasonable time, to take such action, assert such rights, or
pursue such remedies as the Majority Banks or all of the Banks, as the case may
be (as provided for hereunder), shall direct in conformity with this Agreement,
the Majority Banks or all of the Banks, as the case may be (as provided for
hereunder), shall have the right to take such action, to assert such rights, or
pursue such remedies on behalf of all of the Banks unless the terms hereof
otherwise require the consent of all the Banks to the taking of such actions
(in which event all of the Banks must join in such action). Except as expressly
provided above or elsewhere in this Agreement or the other Loan Documents, no
Bank (other than the Agent, acting in its capacity as Agent) shall be entitled
to take any enforcement action of any kind under any of the Loan Documents.
13.16 Co-Agent. [Reserved] has been designated
------------------------------
by the Company as "Co-Agent" under this Agreement.
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Other than its rights and remedies as a Bank hereunder, Co-Agent shall have no
administrative, collateral or other rights or responsibilities, provided,
however, that Co-Agent shall be entitled to the benefits afforded to Agent
under Sections 13.5 and 13.6 hereof.
14. MISCELLANEOUS
14.1 Accounting Principles. Where the character or amount of any
asset or liability or item of income or expense is required to be determined or
any consolidation or other accounting computation is required to be made for
the purposes of this Agreement, it shall be done in accordance with GAAP.
14.2 Consent to Jurisdiction. The Company and each of the
Permitted Borrowers hereby irrevocably submit to the non-exclusive
jurisdiction of any United States Federal or Michigan state court sitting in
Detroit in any action or proceeding arising out of or relating to this
Agreement or any of the other Loan Documents and the Company and each of the
Permitted Borrowers hereby irrevocably agree that all claims in respect of such
action or proceeding may be heard and determined in any such United States
Federal or Michigan state court. Each of the Permitted Borrowers irrevocably
appoints the Company as its agent for service of process. The Company and each
of the Permitted Borrowers irrevocably consent to the service of any and all
process in any such action or proceeding brought in any court in or of the
State of Michigan by the delivery of copies of such process to the Company at
its address specified on the signature page hereto or by certified mail
directed to such address. Nothing in this Section shall affect the right of the
Banks and the Agent to serve process in any other manner permitted by law or
limit the right of the Banks or the Agent (or any of them) to bring any such
action or proceeding against the Company or any of the Permitted Borrowers or
any of its or their property in the courts of any other jurisdiction. The
Company and each of the Permitted Borrowers hereby irrevocably waive any
objection to the laying of venue of any such suit or proceeding in the above
described courts.
14.3 Law of Michigan. This Agreement, the Notes and the other Loan
Documents have been delivered at Detroit, Michigan, and shall be governed by
and construed and enforced in accordance with the laws of the State of
Michigan, except to the extent that the Uniform Commercial Code, other personal
property law or real property law of a jurisdiction where Collateral is located
is applicable and except as and to the extent expressed to the contrary in any
of the Loan Documents. Whenever possible each provision of this Agreement shall
be interpreted in such manner as to be effective and valid under applicable
law, but if any provision of this Agreement shall be prohibited by or invalid
under applicable law, such provision shall be ineffective to the extent of such
prohibition or invalidity, without invalidating the
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remainder of such provision or the remaining provisions of this Agreement.
14.4 Interest. In the event the obligation of the Company or the
Permitted Borrowers to pay interest on the principal balance of any of the
Notes is or becomes in excess of the maximum interest rate which the Company or
any of the Permitted Borrowers is permitted by law to contract or agree to pay,
giving due consideration to the execution date of this Agreement, then, in that
event, the rate of interest applicable with respect to such Bank's Percentage
shall be deemed to be immediately reduced to such maximum rate and all previous
payments in excess of the maximum rate shall be deemed to have been payments in
reduction of principal and not of interest.
14.5 Closing Costs; Other Costs. Each of the Company and the
Permitted Borrowers, jointly and severally, shall pay or reimburse (a) Agent
for payment of, on demand, all reasonable closing costs and expenses,
including, by way of description and not limitation, reasonable in-house and
outside attorney fees and advances, appraisal and accounting fees, lien search
fees, and required travel costs, incurred by Agent in connection with the
commitment, consummation and closing of the loans or advances contemplated
hereby, or in connection with any refinancing or restructuring of the loans or
Advances provided under this Agreement or the other Loan Documents, or any
amendment thereof requested by Company or any of the Permitted Borrowers, and
(b) Agent and each of the Banks, as the case may be, for all stamp and other
taxes and duties payable or determined to be payable in connection with the
execution, delivery, filing or recording of this Agreement and the other Loan
Documents and the consummation of the transactions contemplated hereby, and any
and all liabilities with respect to or resulting from any delay in paying or
omitting to pay such taxes or duties. Furthermore, all reasonable costs and
expenses, including without limitation attorney fees, incurred by Agent in
revising, preserving, protecting, exercising or enforcing any of its or any of
the Banks' rights against Company or any of the Permitted Borrowers, or
otherwise incurred by Agent and the Banks in connection with any Event of
Default or the enforcement of the loans (whether incurred through negotiations,
legal proceedings or otherwise), including by way of description and not
limitation, such charges in any court or bankruptcy proceedings or arising out
of any claim or action by any person against Agent or any Bank which would not
have been asserted were it not for Agent's or such Bank's relationship with
Company and the Permitted Borrowers hereunder or otherwise, shall also be paid
by Company and each of the Permitted Borrowers. All of said amounts required to
be paid by Company and Permitted Borrowers hereunder and not paid forthwith
upon demand, as aforesaid, shall bear interest, from the date incurred to the
date payment is received by Agent, at the Prime-based Rate, plus two percent
(2%).
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14.6 Notices. Except as otherwise provided herein, all notices or
demand hereunder to the parties hereto shall be sufficient if made in writing
and delivered by messenger or deposited in the mail, postage prepaid, certified
mail, and addressed to the parties as set forth on the signature pages of this
Agreement and to each of the Permitted Borrowers at the Company's address. Any
notice or demand given to the Company hereunder shall be deemed given to each
of the Permitted Borrowers, whether or not said notice or demand is addressed
to or received by such Permitted Borrowers.
14.7 Further Action. Company and each of the Permitted Borrowers,
from time to time, upon written request of Agent, will make, execute,
acknowledge and deliver or cause to be made, executed, acknowledged and
delivered, all such further and additional instruments, and take all such
further action, as may be reasonably required to carry out the intent and
purpose of this Agreement, and to provide for Advances under and payment of the
Notes, according to the intent and purpose herein and therein expressed.
14.8 Successors and Assigns; Assignments and Participations.
(a) This Agreement shall be binding upon and shall inure
to the benefit of Company and the Permitted Borrowers and the Banks and their
respective successors and assigns.
(b) The foregoing shall not authorize any assignment by
Company or any of the Permitted Borrowers, of its rights or duties hereunder,
and no such assignment shall be made (or effective) without the prior written
approval of the Banks.
(c) The Company, the Permitted Borrowers and Agent
acknowledge that each of the Banks may at any time and from time to time,
subject to the terms and conditions hereof, assign or grant participations in
such Bank's rights and obligations hereunder and under the other Loan Documents
to any commercial bank, the identity of which institution is approved by
Company and Agent, such approval not to be unreasonably withheld or delayed;
provided, however, that (i) the approval of Company shall not be required upon
the occurrence and during the continuance of a Default or Event of Default and
(ii) the approval of Company and Agent shall not be required for any such sale,
transfer, assignment or participation to the Affiliate of an assigning Bank,
any other Bank or any Federal Reserve Bank; and provided further that, absent
the prior written approval of Company (which shall not be required upon the
occurrence and during the continuance of a Default or Event of Default) and
Agent, the aggregate assignments and participation interests sold by a Bank
(other than (A) pursuant to subparagraph (ii) of this Section 14.8(c), and (B)
Comerica Bank, a Michigan banking corporation) do not exceed fifty percent
(50%) of its original interest therein. The Company and each of the Permitted
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Borrowers authorize each Bank to disclose to any prospective assignee or
participant, once approved by Company and Agent, any and all financial
information in such Bank's possession concerning the Company and the Permitted
Borrowers which has been delivered to such Bank pursuant to this Agreement;
provided that each such prospective participant shall execute a confidentiality
agreement consistent with the terms of Section 14.13 hereof.
(d) Each assignment by a Bank of any portion of its
rights and obligations hereunder and under the other Loan Documents shall be
made pursuant to an Assignment Agreement substantially (as determined by Agent)
in the form attached hereto as Exhibit "N" (with appropriate insertions
acceptable to Agent) and shall be subject to the terms and conditions hereof,
and to the following restrictions:
(i) each assignment shall cover all of the Notes
issued by Company and the Permitted Borrowers
hereunder to the assigning Bank (and not any
particular note or notes), and shall be for a
fixed and not varying percentage thereof,
with the same percentage applicable to each
such Note;
(ii) each assignment shall be in a minimum amount
of Ten Million Dollars ($10,000,000) or, as
applicable, the Alternative Currency
equivalent thereof;
(iii) no assignment shall violate any "blue sky" or
other securities law of any jurisdiction or
shall require the Company, the Permitted
Borrowers or any other Person to file a
registration statement or similar application
with the United States Securities and
Exchange Commission (or similar state
regulatory body) or to qualify under the
"blue sky" or other securities laws of any
jurisdiction; and
(iv) no assignment shall be effective unless Agent
has received from the assignee (or from the
assigning Bank) an assignment fee of $3,500
for each such assignment.
In connection with any assignment, Company, the Permitted Borrowers and Agent
shall be entitled to continue to deal solely and directly with the assigning
Bank in connection with the interest so assigned until (x) the Agent shall have
received a notice of assignment duly executed by the assigning Bank and an
Assignment Agreement (with respect thereto) duly executed by the assigning Bank
and each assignee; and (y) the assigning Bank shall have delivered to the Agent
the original of each Note held by the assigning Bank under
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this Agreement. From and after the date on which the Agent shall notify
Company and the assigning Bank that the foregoing conditions shall have been
satisfied and all consents (if any) required shall have been given, the
assignee thereunder shall be deemed to be a party to this Agreement. To the
extent that rights and obligations hereunder shall have been assigned to such
assignee as provided in such notice of assignment (and Assignment Agreement),
such assignee shall have the rights and obligations of a Bank under this
Agreement and the other Loan Documents(including without limitation the right
to receive fees payable hereunder in respect of the period following such
assignment). In addition, the assigning Bank, to the extent that rights and
obligations hereunder shall have been assigned by it as provided in such notice
of assignment and the Assignment Agreement, but not otherwise, shall relinquish
its rights and be released from its obligations under this Agreement and the
other Loan Documents.
Within five (5) Business Days following Company's receipt of notice from the
Agent that Agent has accepted and executed a notice of assignment and the duly
executed Assignment Agreement, Company and the Permitted Borrowers shall, to
the extent applicable, execute and deliver to the Agent in exchange for any
surrendered Note(s), new Note(s) payable to the order of the assignee in an
amount equal to the amount assigned to it pursuant to such notice of assignment
(and Assignment Agreement), and with respect to the portion of the Indebtedness
retained by the assigning Bank, to the extent applicable, new Note(s) payable
to the order of the assigning Bank in an amount equal to the amount retained by
such Bank hereunder shall be executed and delivered by the Company and each of
the Permitted Borrowers, and applicable Agent, the Banks and the Company and
the Permitted Borrowers acknowledge and agree that any such new Note(s) shall
be given in renewal and replacement of the surrendered Notes and shall not
effect or constitute a novation or discharge of the Indebtedness evidenced by
any surrendered Note, and each such new Note may contain a provision confirming
such agreement. In addition, promptly following receipt of such Notes, Agent
shall prepare and distribute to Company, the Permitted Borrowers and each of
the Banks a revised Exhibit C to this Agreement setting forth the applicable
new Percentages of the Banks (including the assignee Bank), taking into account
such assignment.
(e) Each Bank agrees that any participation agreement
permitted hereunder shall comply with all applicable laws and shall be subject
to the following restrictions (which shall be set forth in the applicable
participation agreement):
(i) such Bank shall remain the holder of its
Notes hereunder, notwithstanding any such
participation;
(ii) except as expressly set forth in this Section
14.8(e) with respect to rights of setoff and
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the benefits of Section 12 hereof, a
participant shall have no direct rights or
remedies hereunder;
(iii) a participant shall not reassign or transfer,
or grant any sub-participations in its
participation interest hereunder or any part
thereof; and
(iv) such Bank shall retain the sole right and
responsibility to enforce the obligations of
the Company and Permitted Borrowers relating
to the Notes and the other Loan Documents,
including, without limitation, the right to
proceed against any Guaranties, or cause
Agent to do so (subject to the terms and
conditions hereof), and the right to approve
any amendment, modification or waiver of any
provision of this Agreement without the
consent of the participant, except for those
matters covered by Section 14.11(a) through
(e) and (h) hereof (provided that a
participant may exercise approval rights over
such matters only on an indirect basis,
acting through such Bank, and Company, the
Permitted Borrowers, Agent and the other
Banks may continue to deal directly with such
Bank in connection with such Bank's rights
and duties hereunder), and shall otherwise be
in form satisfactory to Agent.
Company and the Permitted Borrowers each agrees that each participant shall be
deemed to have the right of setoff under Section 11.4 hereof in respect of its
participation interest in amounts owing under this Agreement and the other Loan
Documents to the same extent as if the Indebtedness were owing directly to it
as a Bank under this Agreement, shall be subject to the pro rata recovery
provisions of Section 11.3 hereof and that each participant shall be entitled
to the benefits of Section 12 hereof. The amount, terms and conditions of any
participation shall be as set forth in the participation agreement between the
issuing Bank and the Person purchasing such participation, and none of the
Company, the Permitted Borrowers, the Agent and the other Banks shall have any
responsibility or obligation with respect thereto, or to any Person to whom any
such participation may be issued. No such participation shall relieve any
issuing Bank of any of its obligations under this Agreement or any of the other
Loan Documents, and all actions hereunder shall be conducted as if no such
participation had been granted.
(f) Nothing in this Agreement, the Notes or the other
Loan Documents expressed or implied, is intended to or shall confer
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on any Person other than the respective parties hereto and thereto and their
successors and assignees permitted hereunder and thereunder any benefit or any
legal or equitable right, remedy or other claim under this Agreement, the Notes
or the other Loan Documents.
14.9 Indulgence. No delay or failure of Agent and the Banks in
exercising any right, power or privilege hereunder shall affect such right,
power or privilege, nor shall any single or partial exercise thereof preclude
any other or further exercise thereof, or the exercise of any other right,
power or privilege. The rights of Agent and the Banks hereunder are cumulative
and are not exclusive of any rights or remedies which Agent and the Banks would
otherwise have.
14.10 Counterparts. This Agreement may be executed in several
counterparts, and each executed copy shall constitute an original instrument,
but such counterparts shall together constitute but one and the same
instrument.
14.11 Amendment and Waiver. No amendment or waiver of any provision
of this Agreement or any other Loan Document, or consent to any departure by
the Company or any of the Permitted Borrowers therefrom, shall in any event be
effective unless the same shall be in writing and signed by the Majority Banks,
and then such waiver or consent shall be effective only in the specific
instance and for the specific purpose for which given; provided, however, that
no amendment, waiver or consent shall, unless in writing and signed by all the
Banks, do any of the following: (a) subject the Banks to any additional
obligations, (b) reduce the principal of, or interest on, the Notes or any Fees
or other amounts payable hereunder, (c) postpone any date fixed for any payment
of principal of, or interest on, the Notes or any Fees or other amounts payable
hereunder, (d) waive any Event of Default specified in Sections 10.1(a) or (b)
hereof, (e) release or defer the granting or perfecting of a lien or security
interest in any Collateral or release any Guaranty, indemnity or similar
undertaking provided by any Person, except as shall be otherwise expressly
provided in this Agreement or any other Loan Document, (f) take any action
which requires the signing of all Banks pursuant to the terms of this Agreement
or any other Loan Document, (g) change the aggregate unpaid principal amount of
the Notes which shall be required for the Banks or any of them to take any
action under this Agreement or any other Loan Document, (h) change the
definitions of "Majority Banks", "Alternative Currency" or "Subordinated Debt"
or (i) change this Section 14.11, and provided further, however, that no
amendment, waiver, or consent shall, unless in writing and signed by the Agent
in addition to all the Banks, affect the rights or duties of the Agent under
this Agreement or any other Loan Document, whether in its capacity as Agent or
Issuing Bank, or as Collateral Agent under the Intercreditor Agreement. All
references
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in this Agreement to "Banks" or "the Banks" shall refer to all Banks, unless
expressly stated to refer to Majority Banks.
14.12 Taxes and Fees. Should any tax (other than a tax based upon
the net income of any Bank or Agent by any jurisdiction where a Bank or Agent
is located), recording or filing fee become payable in respect of this
Agreement or any of the other Loan Documents or any amendment or modification
hereto or thereto, or supplement hereof or thereof, the Company and each of the
Permitted Borrowers, jointly and severally, agrees to pay the same, together
with any interest or penalties thereon (unless the failure to pay such tax on a
timely basis is not due to the action or inaction of the Company or any of its
Subsidiaries) and agrees to hold the Agent and the Banks harmless with respect
thereto.
14.13 Confidentiality. Each Bank agrees that without the prior
consent of Company, it will not disclose (other than to its employees, to
another Bank or to its auditors or counsel) any information with respect to the
Company or any of its Subsidiaries or any of the Permitted Borrowers which is
furnished pursuant to the terms and conditions of this Agreement or any of the
other Loan Documents or which is designated (in writing) by Company or any of
the Permitted Borrowers to be confidential; provided that any Bank may disclose
any such information (a) as has become generally available to the public or has
been lawfully obtained by such Bank from any third party under no duty of
confidentiality to the Company, (b) as may be required in any report, statement
or testimony submitted to, or in respect of any inquiry, by, any municipal,
state or federal regulatory body having or claiming to have jurisdiction over
such Bank, including the Board of Governors of the Federal Reserve System of
the United States or the Federal Deposit Insurance Corporation or similar
organizations (whether in the United States or elsewhere) or their successors,
(c) as may be required in respect of any summons or subpoena or in connection
with any litigation, (d) in order to comply with any law, order, regulation or
ruling applicable to such Bank, and (e) to any permitted transferee or assignee
or to any approved participant of, or with respect to, the Notes, as aforesaid.
14.14 Withholding Taxes. If any Bank is not incorporated under the
laws of the United States or a state thereof, such Bank shall promptly deliver
to the Agent two executed copies of (i) Internal Revenue Service Form 1001
specifying the applicable tax treaty between the United States and the
jurisdiction of such Bank's domicile which provides for the exemption from
withholding on interest payments to such Bank, (ii) Internal Revenue Service
Form 4224 evidencing that the income to be received by such Bank hereunder is
effectively connected with the conduct of a trade or business in the United
States or (iii) other evidence satisfactory to the Agent that such Bank is
exempt from United States income tax withholding with respect to such income.
Such Bank shall amend or supplement any such form or evidence as required to
insure that it
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is accurate, complete and non-misleading at all times. Promptly upon notice
from the Agent of any determination by the Internal Revenue Service that any
payments previously made to such Bank hereunder were subject to United States
income tax withholding when made, such Bank shall pay to the Agent the excess
of the aggregate amount required to be withheld from such payments over the
aggregate amount actually withheld by the Agent. In addition, from time to time
upon the reasonable request and at the sole expense of the Company or any of
the Permitted Borrowers, each Bank and the Agent shall (to the extent it is
able to do so based upon applicable facts and circumstances), complete and
provide the Company or any of the Permitted Borrowers with such forms,
certificates or other documents as may be reasonably necessary to allow the
Company or the Permitted Borrower, as applicable, to make any payment under
this Agreement or the other Loan Documents without any withholding for or on
the account of any tax under Section 11.1(d) hereof (or with such withholding
at a reduced rate), provided that the execution and delivery of such forms,
certificates or other documents does not adversely affect or otherwise restrict
the right and benefits (including without limitation economic benefits)
available to such Bank or the Agent, as the case may be, under this Agreement
or any of the other Loan Documents, or under or in connection with any
transactions not related to the transactions contemplated hereby.
14.15 Effective Upon Execution. This Agreement shall become
effective upon the execution hereof by Banks, Agent and the Company and the
issuance by the Company and the Permitted Borrowers, as applicable, of the
Revolving Credit Notes, the Swing Line Notes and the Term Notes hereunder, and
shall remain effective until the Indebtedness has been repaid and discharged in
full and no commitment to extend any credit hereunder remains outstanding. By
execution of the aforesaid Notes, together with any applicable Term Notes, the
Permitted Borrowers shall become obligated hereunder.
14.16 Severability. In case any one or more of the obligations of
the Company or any of the Permitted Borrowers under this Agreement, the Notes
or any of the other Loan Documents shall be invalid, illegal or unenforceable
in any jurisdiction, the validity, legality and enforceability of the remaining
obligations of the Company or the Permitted Borrowers shall not in any way be
affected or impaired thereby, and such invalidity, illegality or
unenforceability in one jurisdiction shall not affect the validity, legality or
enforceability of the obligations of the Company or the Permitted Borrowers
under this Agreement, the Notes or any of the other Loan Documents in any other
jurisdiction.
14.17 Table of Contents and Headings. The table of contents and the
headings of the various subdivisions hereof are for convenience of reference
only and shall in no way modify or affect any of the terms or provisions
hereof.
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14.18 Construction of Certain Provisions. If any provision of this
Agreement or any of the other Loan Documents refers to any action to be taken
by any Person, or which such Person is prohibited from taking, such provision
shall be applicable whether such action is taken directly or indirectly by such
Person, whether or not expressly specified in such provision.
14.19 Independence of Covenants. Each covenant hereunder shall be
given independent effect (subject to any exceptions stated in such covenant) so
that if a particular action or condition is not permitted by any such covenant
(taking into account any such stated exception), the fact that it would be
permitted by an exception to, or would be otherwise within the limitations of,
another covenant shall not avoid the occurrence of a Default or an Event of
Default if such action is taken or such condition exists.
14.20 Reliance on and Survival of Various Provisions. All terms,
covenants, agreements, representations and warranties of the Company or any
party to any of the Loan Documents made herein or in any of the other Loan
Documents or in any certificate, report, financial statement or other document
furnished by or on behalf of the Company, any such party in connection with
this Agreement or any of the other Loan Documents shall be deemed to have been
relied upon by the Banks, notwithstanding any investigation heretofore or
hereafter made by any Bank or on such Bank's behalf, and those covenants and
agreements of the Company and the Permitted Borrowers set forth in Section 12.8
hereof (together with any other indemnities of the Company or the Permitted
Borrowers contained elsewhere in this Agreement or in any of the other Loan
Documents) and of Banks set forth in Section 14.13 hereof shall,
notwithstanding anything to the contrary contained in this Agreement, survive
the repayment in full of the Indebtedness and the termination of any
commitments to make Advances hereunder.
14.21 Complete Agreement. This Agreement, the Notes, any requests
for Advances or Letters of Credit hereunder, the other Loan Documents and any
agreements, certificates, or other documents given to secure the Indebtedness,
contain the entire agreement of the parties hereto with respect to the
transactions contemplated hereby, and none of the parties hereto shall be bound
by anything not expressed in writing.
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WITNESS the due execution hereof as of the day and year first above
written.
COMPANY: AGENT:
WALBRO CORPORATION COMERICA BANK, As Agent
By: By:
------------------------------ -------------------------------------
Its: Its:
----------------------------- ------------------------------------
6242 Garfield Street One Detroit Center
Cass City, MI 48726 500 Woodward Avenue
Attention: Detroit, Michigan 48226
---------------------- Attention: Renee D. Weinman
BANKS:
COMERICA BANK
By:
-------------------------------------
Its:
------------------------------------
One Detroit Center
500 Woodward Avenue
Detroit, Michigan 48226
Attention: Renee D. Weinman
Fax No.: (313)
-------------------------
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EXHIBIT
BANKS PERCENTAGES
================================================================================
Comerica Bank 100%
================================================================================
Total 100%
================================================================================
135
EX-23.1
5
EXHIBIT 23.1
1
EXHIBIT 23.1
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation of
our report dated June 15, 1995, with respect to the combined balance sheet of
the Fuel Tank Division of Dyno Industrier A.S as of March 31, 1995 and the
related combined statements of income, stockholders' and divisional equity, and
cash flows for the three months then ended, which report is included in this
Form 8-K of Walbro Corporation, into Walbro Corporation's previously filed
Registration Statements on Form S-8 (File Nos. 33-32068, 33-20841, 33-48562).
ARTHUR ANDERSEN & CO. GmbH
August 7, 1995
Stuttgart, Germany
EX-23.2
6
EXHIBIT 23.2
1
EXHIBIT 23.2
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation of
our report dated April 20, 1995, with respect to the combined balance sheet of
the Fuel Tank Division of Dyno Industrier A.S as of December 31, 1994 and the
related combined statements of income, stockholders' and divisional equity, and
cash flows for the year then ended, which report is included in this Form
8-K of Walbro Corporation, into Walbro Corporation's previously filed
Registration Statements on Form S-8 (File Nos. 33-32068, 33-20841, 33-48562).
ARTHUR ANDERSEN & CO. GmbH
August 7, 1995
Stuttgart, Germany
EX-23.3
7
EXHIBIT 23.3
1
EXHIBIT 23.3
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
We consent to the incorporation of our report dated May 12, 1995 of the
combined balance sheet of the Fuel Tank System Division of Dyno Industrier A.S
as of December 31, 1993 and the related combined statements of income and cash
flows for the year then ended, and our report dated May 30, 1995 of the
combined statement of revenues and direct costs and expenses of the Fuel Tank
System Division of Dyno Industrier A.S for the year ended December 31, 1992,
which reports are included in this Form 8-K of Walbro Corporation, into Walbro
Corporation's previously filed Registration Statements on Form S-8 (File Nos.
33-32068, 33-20841, 33-48562).
DELOITTE & TOUCHE
Oslo, Norway
August 8, 1995