UNITED STATES
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:
February 7, 2005
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(Date of earliest event reported)
RAYOVAC CORPORATION
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(Exact Name of Registrant as Specified in Charter)
Wisconsin 001-13615 22-2423556
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(State or other Jurisdiction of (Commission File No.) (IRS Employer
Incorporation) Identification No.)
Six Concourse Parkway, Suite 3300, Atlanta, Georgia 30328
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(Address of principal executive offices, including zip code)
(770) 829-6200
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(Registrant's telephone number, including area code)
Not Applicable
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(Former Name or Former Address, if Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the Registrant under any of
the following provisions:
|_| Written communications pursuant to Rule 425 under the Securities Act
(17 CFR 230.425)
|_| Soliciting material pursuant to Rule 14a-12 under the Exchange Act
(17 CFR 240.14a-12)
|_| Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
|_| Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
Item 1.01. ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT.
New Indenture
On February 7, 2005, Rayovac Corporation (the "Company") and certain of its
domestic subsidiaries, as guarantors, entered into an Indenture (the
"Indenture") with U.S. Bank National Association, as trustee, relating to the
issuance by the Company of $700,000,000 aggregate principal amount of 7 3/8%
Senior Subordinated Notes due 2015 (the "Notes"). The Notes were sold in a
private transaction not subject to the registration requirements of the
Securities Act of 1933 (the "Securities Act"), and have not been and will not
be registered under the Securities Act, and may not be offered or sold in the
United States absent registration or an applicable exemption from the
registration requirements of the Securities Act.
The Notes bear an interest rate of 7 3/8% per annum and will be payable
semi-annually in arrears on February 1 and August 1, commencing on August 1,
2005. The Company will make each interest payment to the holders of record on
the immediately preceding January 15 and July 15. The Notes are general
unsecured obligations of the Company. They are subordinated in right of
payment to all existing and future senior debt of the Company, including the
indebtedness of the Company under its senior credit facilities. The Notes are
pari passu in right of payment with all existing and any future senior
subordinated indebtedness of the Company and are senior in right of payment to
any future subordinated indebtedness of the Company.
The terms of the Notes are governed by the Indenture. The Indenture contains
customary covenants that limit the Company's ability to, among other things,
incur additional indebtedness, pay dividends on or redeem or repurchase the
Company's equity interests, make certain investments, expand into unrelated
businesses, create liens on assets, merge or consolidate with another company,
transfer or sell all or substantially all of the Company's assets, and enter
into transactions with affiliates. Upon the occurrence of a "change of
control," as defined in the Indenture, the Company is required to make an
offer to repurchase the outstanding Notes at 101% of the principal amount
thereof, plus accrued and unpaid interest, if any, to the repurchase date.
Beginning on February 1, 2010, the Company may redeem all or a part of the
Notes upon not less than 30 nor more than 60 days' notice, at redemption
prices (expressed as percentages of principal amount) of 101.229%, 102.458%
and 103.688% of the principal amount thereof, plus accrued and unpaid interest
and any applicable liquidated damages, for redemptions occurring during the
twelve-month period beginning on February 1 of 2012, 2011, and 2010,
respectively. Thereafter, the redemption price is 100.000% of the principal
amount of the Notes to be redeemed, plus accrued and unpaid interest and any
applicable liquidated damages. Prior to February 1, 2008, the Company may
redeem up to 35% of the aggregate principal amount of Notes at a redemption
price of 107.375% of the principal amount thereof, plus accrued and unpaid
interest and any applicable liquidated damages, with the net cash proceeds
from certain equity offerings of the Company.
The Indenture is subject to customary events of default, including failure to
make required payments, failure to comply with certain agreements or
covenants, failure to pay or acceleration of certain other indebtedness, and
certain events of bankruptcy and insolvency. Events of default
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under the Indenture arising from certain events of bankruptcy or insolvency
will automatically cause the acceleration of the amounts due under the Notes.
If any other event of default under the Indenture occurs and is continuing,
the Trustee or the registered holders of at least 25% in aggregate principal
amount of the then outstanding Notes may declare the acceleration of the
amounts due under the Notes.
The net proceeds from the offering of the Notes, together with borrowings
under the Company's new senior credit facilities, were used to finance the
acquisition of United Industries Corporation ("United"), to retire United's
then existing indebtedness and the Company's former senior credit facilities,
and to pay related fees and expenses.
Supplement to Existing Indenture
On February 7, 2005, the Company, U.S. Bank National Association and certain
subsidiaries of the Company entered into the Third Supplemental Indenture (the
"Third Supplemental Indenture") to the Indenture (the "2003 Indenture") dated
as of September 30, 2003 (as previously supplemented) governing the Company's
8 1/2% Senior Subordinated Notes due 2013. The Third Supplemental Indenture
added United and certain of its subsidiaries as guarantors under the 2003
Indenture, removed Lindbergh Corporation, whose corporate existence was
terminated in connection with the Company's acquisition of United, as a
guarantor under the 2003 Indenture and corrected certain cross-references
contained in the 2003 Indenture.
New Credit Agreement, Security Agreement and Guarantees
On February 7, 2005, the Company, as the U.S. Borrower, the Subsidiary
Borrowers named therein, Bank of America, N.A., as Administrative Agent, Swing
Line Lender and L/C Issuer, Citicorp North America, Inc., as Syndication
Agent, Merrill Lynch Capital Corporation, as Documentation Agent and as
Managing Agent, the other lenders party thereto, Banc of America Securities
LLC and Citigroup Global Markets Inc., as Joint Lead Arrangers, and Banc of
America Securities LLC, Citigroup Global Markets Inc. and Merrill Lynch,
Pierce, Fenner & Smith, as Joint Book Managers, entered into the Fourth
Amended and Restated Credit Agreement (the "Senior Credit Facility"), which
amended and restated the Company's preexisting credit agreement relating to
its preexisting senior credit facilities. The Senior Credit Facility provides
the opportunity to borrow in domestic and foreign currencies through various
term loan facilities and revolving credit facilities in an initial aggregate
amount of $1.03 billion. The Senior Credit Facility includes aggregate term
loan facilities of $730 million consisting of a $540 million U.S. Dollar Term
Loan B Facility, U.S. $140 million Euro Term Loan B Facility and U.S. $50
million Canadian Dollar Term Loan B Facility. The Senior Credit Facility also
includes $300 million revolving credit facilities allowing for U.S. Dollar,
Euro and Pounds Sterling borrowings (the "Revolving Credit Facilities"), each
of which will be available from February 7, 2005 until the earliest of (a)
February 6, 2011, (b) voluntary termination by the borrowers or (c)
termination as a result of an event of default under the Credit Agreement
(together, the "Maturity Date"). The Revolving Credit Facilities include
sublimits for swing line loans ("Swing Line Loans") denominated in U.S.
dollars, Euros and Pounds Sterling equal to the lesser of U.S.$15,000,000 and
the amount currently available under the U.S. Revolving Credit Facility for
borrowings in U.S. dollars; the lesser of the U.S. dollar equivalent of
(euro)5,000,000 and the amount currently available under the Euro Revolving
Credit Facility for borrowings in Euros, and the lesser of the U.S. dollar
equivalent of (pound)5,000,000 and the amount currently available under the UK
Revolving Credit Facility for borrowings in Pounds Sterling.
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The Company is the U.S. borrower under the Senior Credit Facility and certain
of its subsidiaries, namely Varta Consumer Batteries GmbH & Co. KGaA and
Rayovac Europe Limited are foreign borrowers. At any time, and from time to
time before the Maturity Date, the Company can request up to five additional
incremental term loan facilities in U.S. dollars, Euros or with the consent of
the Administrative Agent, other foreign currencies, all in an aggregate amount
up to $500 million. The Company may add additional foreign borrowers from time
to time with the consent of the Administrative Agent.
The interest and fees per annum are calculated on a 365-day (or 366-day, as
the case may be) basis for Base Rate (as defined below) loans and loans
denominated in Pounds Sterling. For all other denominations, interest and fees
per annum are calculated on the basis of a 360-day year. The interest rates
per annum applicable to the Senior Credit Facility (other than in respect of
Swing Line Loans) are the Eurocurrency Rate plus the Applicable Margin (as
defined below) or, at the Company's option in the case of advances made in
U.S. dollars, the base rate (which is the higher of (x) the Bank of America
prime rate and (y) the Federal Funds rate plus 0.5% (the "Base Rate")) plus
the Applicable Margin. Applicable Margin means, (i) with respect to the U.S.
Dollar Term Loan B Facility and the Canadian Term Loan B Facility (a) until
August 7, 2005, 2.00% per annum in the case of Eurocurrency Rate advances and
with respect to U.S. Dollar Term Loan B Facility only, 1.00% per annum in the
case of Base Rate advances and (b) thereafter, a percentage per annum to be
determined in accordance with a pricing grid based on debt ratings, (ii) with
respect to the Euro Term Loan B Facility, 2.50% per annum, and (iii) with
respect to the Revolving Credit Facility, (a) until August 7, 2005, 2.25% per
annum in the case of Eurocurrency Rate advances and in the case of advances
made in U.S. dollars only, 1.25% per annum in the case of Base Rate advances
and (b) thereafter, a percentage per annum to be determined in accordance with
a pricing grid based on the Leverage Ratio (as defined in the credit agreement
pertaining to the Senior Credit Facility). Each Swing Line Loan denominated in
U.S. dollars shall bear interest at the Base Rate plus the Applicable Margin
for Base Rate advances under the Revolving Credit Facilities. Each Swing Line
Loan denominated in either Euros or Pounds Sterling shall bear interest at a
rate per annum equal to the rate of interest at which deposits having a term
of one day in the applicable currency would be offered to major banks in the
London interbank market, plus the Applicable Margin for the Revolving Credit
Facilities.
The Company and the foreign borrowers are required to pay a quarterly
commitment fee on the Revolving Credit Facilities that equal 0.50% times the
amount by which the aggregate revolving credit commitments exceeds the sum of
(a) the outstanding revolving credit loans and (b) the outstanding amounts of
the dollar letter of credit commitments. A quarterly letter of credit fee
equal to the Applicable Margin on Revolving Credit LIBOR Advances (as defined
in the credit agreement pertaining to the Senior Credit Facility) times the
amount available to be drawn under the letters of credit is also payable on
the stated amount of outstanding letters of credit.
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The term loan facilities are subject to repayment according to a scheduled
amortization, with the final payment of all amounts outstanding, plus accrued
and unpaid interest, due on February 6, 2012. The Revolving Credit Facility
will terminate on February 6, 2011.
Beginning with the fiscal year ended September 30, 2006, the Senior Credit
Facility provides for annual mandatory prepayments, over and above the normal
amortization as a result of "Excess Cash Flow" (as defined, less certain
operating expenditures including scheduled principal payments of long-term
debt). The Senior Credit Facility also provides for other mandatory
prepayments as a result of issuance of debt (excluding certain permitted
indebtedness) and sales of certain assets above an annual threshold.
The Senior Credit Facility is secured by substantially all of the Company's
domestic assets and certain of its foreign assets pursuant to a security
agreement (the "Security Agreement") made by the Company and certain of its
subsidiaries on February 7, 2005, which secures the domestic obligations of
the Senior Credit Facility, as well as certain share charges made by certain
foreign subsidiaries on February 7, 2005, which secure the obligations of the
foreign borrowers. The Company's obligations under the Senior Credit Facility
are guaranteed by certain of the Company's subsidiaries, including all of the
Company's domestic subsidiaries, pursuant to a guarantee executed by those
subsidiaries on February 7, 2005 (the "ROV Guaranty"). Similarly, the
obligations of the foreign borrowers are secured by certain guarantees made by
the foreign borrowers and certain of their subsidiaries pursuant to two
guarantees executed by those subsidiaries on February 7, 2005 (the "KGaA
Guaranty" and "UK Guaranty").
The Senior Credit Facility contains financial covenants with respect to debt
which include maintaining minimum interest and maximum leverage ratios. In
accordance with the agreement, the limits imposed by such ratios become more
restrictive over time. In addition, the agreement restricts the Company's
ability to incur additional indebtedness, create liens, make investments or
specified payments, give guarantees, pay dividends, make capital expenditures
and merge or acquire or sell assets.
The Senior Credit Facility contains customary events of default, including,
without limitation, payment defaults, breaches of representations and
warranties, covenant defaults, cross-defaults to similar obligations, certain
events of bankruptcy and insolvency, judgment defaults, failure of any
guaranty or security document supporting the agreement to be in full force and
effect, change of control and customary ERISA defaults. If an event of default
occurs and is continuing, amounts due under the Senior Credit Facility may be
accelerated and the rights and remedies of the lenders under the Senior Credit
Facility available under the applicable loan-related documents may be
exercised, including rights with respect to the collateral securing
obligations under the Senior Credit Facility.
Registration Rights Agreement relating to the Notes
In connection with the issuance of the Notes, the Company entered into a
registration rights agreement, dated February 7, 2005 (the "Registration
Rights Agreement"), by and between the Company, certain of the Company's
domestic subsidiaries and the initial purchasers of the Notes. Under the
Registration Rights Agreement, the Company agreed, among other things, to (i)
file an
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exchange offer registration statement with the Securities and Exchange
Commission ("SEC") with respect to the Notes within 120 days after February 7,
2005, (ii) use reasonable best efforts to have such exchange offer
registration statement declared effective by the SEC within 240 days after
February 7, 2005, (iii) commence an exchange offer upon effectiveness of the
exchange offer registration statement and (iv) cause the exchange offer to be
consummated no later than 30 business days after the exchange offer
registration statement becomes effective. Under certain circumstances, the
Company has agreed to file a shelf registration statement with the SEC with
respect to the resale of the Notes. If the Company does not comply with these
obligations, subject to limitations set forth in the Registration Rights
Agreement, the Company will be required to pay additional interest in an
amount equal to a per annum rate of 0.25% on the principal amount of the Notes
for the first 90 days following default. Thereafter, the amount of interest
will increase by an additional per annum rate of 0.25% on the principal amount
of the Notes for each subsequent 90-day period until all registration defaults
have been cured, up to a maximum amount of additional interest for all
registration defaults of 1.00% per annum on the principal amount of the Notes.
Registration Rights Agreement relating to the United acquisition
On February 7, 2005, the Company entered into a registration rights agreement
(the "Acquisition Registration Rights Agreement") with certain former
stockholders of United, including certain affiliates of Thomas H. Lee
Partners, L.P. and an affiliate of Banc of America Securities LLC, pursuant to
which the Company has agreed to prepare and file with the SEC, not later than
nine months following the consummation of the acquisition of United on
February 7, 2005, a registration statement to permit the public offering and
resale under the Securities Act of 1933 on a continuous basis of shares of the
Company's common stock issued in connection with its acquisition of United
(the "Shelf Registration Statement"). Pursuant to the Acquisition Registration
Rights Agreement, the Company will also grant to the former stockholders of
United certain rights to require the Company, on not more than three
occasions, to amend the Shelf Registration Statement or prepare and file a new
registration statement to permit an underwritten offering of shares of the
Company's stock received by them in the acquisition of United as well as
certain rights to include those shares in any registration statement proposed
to be filed by the Company. In addition, the Acquisition Registration Rights
Agreement prohibits those former stockholders party to the agreement from
selling or transferring shares of the Company's common stock received in the
acquisition of United for 12 months following the consummation of that
acquisition or from selling or transferring more than 50% of those shares
during the 18 month period following the consummation of that acquisition.
Standstill Agreement
On February 7, 2005, the Company entered into a standstill agreement (the
"Standstill Agreement") with Thomas H. Lee Equity Fund IV, L.P., THL Equity
Advisors IV, LLC, Thomas H. Lee Partners, L.P. and Thomas H. Lee Advisors,
L.L.C. (the "Restricted Parties"). Pursuant to the Standstill Agreement, the
Restricted Parties are prohibited until February 7, 2010 from acquiring
ownership in excess of 28% of the Company's outstanding voting capital stock,
on a fully-diluted basis, soliciting proxies or consents with respect to the
Company's voting capital stock, soliciting or encouraging third parties to
acquire or seek to acquire the Company, a significant portion of the Company's
assets or more than 5% of the Company's outstanding voting capital stock or
joining or participating in a pooling agreement, syndicate, voting trust or
other similar arrangement with respect to the Company's voting capital stock
for the purpose of acquiring, holding, voting or disposing of such voting
capital stock.
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Certain Relationships
Banc of America Securities LLC, Citigroup Global Markets Inc., Merrill Lynch,
Pierce, Fenner & Smith Incorporated and ABN AMRO Incorporated were the initial
purchasers of the Notes. Bank of America, N.A., an affiliate of Banc of
America Securities LLC, Citicorp North America, Inc., an affiliate of
Citigroup Global Markets Inc., Merrill Lynch Capital Corporation, an affiliate
of Merrill Lynch, Pierce, Fenner & Smith Incorporated and LaSalle Bank, N.A.,
an affiliate of ABN AMRO Incorporated, are lenders to Rayovac under the Senior
Credit Facility, and, other than LaSalle Bank, N.A., each of them were lenders
under the United senior credit facilities that were retired in connection with
the Company's acquisition of United. Bank of America Securities LLC provided
services to the Company in connection with the Company's tender offer for
outstanding United 9 7/8% Senior Subordinated Notes due 2009 in connection
with the Company's acquisition of United. In addition, an affiliate of Banc of
America Securities LLC and Bank of America, N.A. owned United stock
immediately prior to the Company's acquisition of United and currently
beneficially owns less than 3% of the Company's outstanding common stock.
Certain affiliates of Thomas H. Lee Partners, L.P. were the majority
shareholders of United as of immediately prior to the consummation of the
Company's acquisition of United, and as a result of the Company's acquisition
of United, are significant shareholders of the Company. Certain affiliates of
Thomas H. Lee Partners, L.P. previously provided United with certain
professional services. In addition, two of the Company's directors, Scott A.
Schoen and Charles A. Brizius, are members of Thomas H. Lee Advisors, LLC,
which is the general partner of Thomas H. Lee Partners, L.P. For additional
information regarding certain relationships involving Thomas H. Lee Partners,
L.P. and its affiliates, please refer to Items 2.01 and 5.02(d) of this
Current Report on Form 8-K.
The foregoing descriptions of the Indenture, the Third Supplemental Indenture,
the Senior Credit Facility, the Security Agreement, the ROV Guaranty, the KGaA
Guaranty, the UK Guaranty, the Registration Rights Agreement, the Acquisition
Registration Rights Agreement and the Standstill Agreement do not purport to
be complete, and are qualified in their entirety by reference to the full text
of those agreements, copies of which are filed as Exhibits 4.1, 4.2, 10.1,
10.2, 10.3, 10.4, 10.5, 4.3, 10.6 and 10.7, respectively, to this Current
Report on Form 8-K and are incorporated herein by reference.
Item 2.01. COMPLETION OF ACQUISITION OR DISPOSITION OF ASSETS.
On February 7, 2005, the Company acquired all of the equity interests of
United pursuant to the Agreement and Plan of Merger (as amended, the "Merger
Agreement") by and among the Company, Lindbergh Corporation and United dated
as of January 3, 2005 filed as an exhibit to the Current Report on Form 8-K
filed by the Company on January 4, 2005. Pursuant to the terms of the Merger
Agreement, Lindbergh Corporation merged with and into United, with United
continuing as the surviving corporation (the "Merger"). The total merger
consideration consisted of 13.75 million shares of the Company's common stock
and approximately $70 million in cash.
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The cash portion of the merger consideration relating to the acquisition of
United was financed from the proceeds of the sale of the Notes and from the
Senior Credit Facility, both described in Item 1.01 of this Current Report on
Form 8-K.
In connection with the acquisition of United, and pursuant to the
shareholder's agreement entered into by the Company and a former shareholder
of United (which shareholder was affiliated with Thomas H. Lee Partners, L.P.)
in connection with the Merger (which shareholder's agreement was filed as an
exhibit to the Company's Current Report on Form 8-K filed on January 4, 2005),
the Company increased the size of its Board of Directors from eight to ten
members. Scott A. Schoen and Charles A. Brizius, both of Thomas H. Lee
Partners, L.P., have been appointed as the new members of the Company's Board
of Directors. Mr. Schoen is Co-President and Mr. Brizius is Managing Director
of Thomas H. Lee Partners, L.P. In addition, Robert L. Caulk, Chief Executive
Officer of United, will become a member of Rayovac's Executive Committee.
David A. Jones, Chairman of the Board and Chief Executive Officer of the
Company, and trusts for his family members, collectively owned 202,935 shares
of United common stock as of immediately prior to the Merger, which shares
were converted into an aggregate of 36,239 shares of Company common stock
pursuant to the Merger. In addition, Mr. Jones held vested options to acquire
397,065 shares of United common stock at a weighted average exercise price of
$2.00 per share, which, pursuant to the terms of the Merger Agreement, were
cashed out in an amount equal to the number of shares underlying options
having an exercise price less than $5.997 per share multiplied by the amount
by which $5.997 exceeded the relevant option exercise price. Mr. Jones was a
member of the Board of Directors of United from January 20, 1999 to December
31, 2003 and provided consulting services to United under an agreement that
was terminated on September 28, 2004. Thomas R. Shepherd, a member of the
Company's Board of Directors, is an investor in Thomas H. Lee Equity Fund IV,
L.P, a large shareholder of United immediately prior to the Merger, and, as a
result of the Merger, currently is a large shareholder of Rayovac. The
Company's Board of Directors established an independent committee of the Board
of Directors, which did not include Mr. Jones or Mr. Shepherd, to evaluate,
negotiate and approve the terms of the acquisition of United.
For additional information regarding certain relationships involving Thomas H.
Lee Partners, L.P. and its affiliates, please refer to Items 1.01 and 5.02(d)
of this Current Report on Form 8-K.
Item 2.03. CREATION OF A DIRECT FINANCIAL OBLIGATION OR AN OBLIGATION
UNDER AN OFF-BALANCE SHEET ARRANGEMENT OF A REGISTRANT.
(a)
The disclosures under Item 1.01 of this Current Report on Form 8-K relating to
the Indenture and the Senior Credit Facility are incorporated herein by
reference.
Item 3.03. MATERIAL MODIFICATION TO RIGHTS OF SECURITY HOLDERS
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(a)
The disclosure under Item 1.01 of this Current Report on Form 8-K relating to
the Third Supplemental Indenture is incorporated herein by reference.
(b)
The disclosure under Item 1.01 of this Current Report on Form 8-K relating to
the Indenture and the Senior Credit Facility is incorporated herein by
reference.
Item 5.02. DEPARTURE OF DIRECTORS OR PRINCIPAL OFFICERS; ELECTION OF
DIRECTORS; APPOINTMENT OF PRINCIPAL OFFICERS.
(d)
On February 7, 2005, Scott A. Schoen and Charles A. Brizius were appointed as
members of the Company's Board of Directors. Mr. Schoen and Mr. Brizius were
appointed pursuant to the shareholder's agreement (the "Shareholder's
Agreement") by and between the Company and UIC Holdings, L.L.C. ("Holdings")
dated as of January 3, 2005, which was filed as an exhibit to the Current
Report on Form 8-K filed by the Company on January 4, 2005. On January 14,
2005, Holdings merged with and into United. As permitted by the Shareholder's
Agreement, Holdings assigned its rights and obligations under the
Shareholder's Agreement to Thomas H. Lee Partners, L.P. or its affiliates
("THL"). Pursuant to the Shareholder's Agreement, the Company will allow THL
to include on any slate of directors presented to the Company's stockholders
for election at the appropriate meeting of stockholders, to be approved by the
Company's nominating committee, up to two directors on the Company's Board of
Directors for so long as THL owns at least 15% of the Company's issued and
outstanding common stock on a fully-diluted basis, and one director for so
long as THL owns at least 10% of the Company's issued and outstanding common
stock on a fully-diluted basis.
United previously had a professional services agreement with certain
affiliates of Thomas H. Lee Partners, L.P. pursuant to which the Company paid
$62,500 per month for management and other consulting services and reimbursed
out-of-pocket expenses. In connection with the Merger, the professional
services agreement was terminated effective as of the Merger. Messrs. Schoen
and Brizius are members of Thomas H. Lee Advisors, LLC, which is the general
partner of Thomas H. Lee Partners, L.P., which is the manager of THL Equity
Advisors IV, LLC, which, in turn, is the general partner of each of the Thomas
H. Lee related funds that were shareholders of United immediately prior to the
Merger and now are significant shareholders of the Company.
For additional information regarding certain relationships involving Thomas H.
Lee Partners, L.P. and its affiliates, please refer to Items 1.01 and 2.01 of
this Current Report on Form 8-K.
Item 5.03. AMENDMENTS TO ARTICLES OF INCORPORATION OR BYLAWS;
CHANGE IN FISCAL YEAR.
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(a)
Effective as of February 7, 2005, the Board of Directors of the Company
amended Section III.1 of the Company's By-Laws to change the permitted range
of number of directors from between five and nine to between five and twelve.
The full text of the amendment to the Company's By-Laws is attached as Exhibit
3.1 to this Current Report on Form 8-K.
Item 8.01. OTHER EVENTS.
On February 7, 2005 the Company issued a press release, a copy of which is
filed as Exhibit 99.1 to this Current Report on Form 8-K and is incorporated
herein by reference.
Item 9.01. FINANCIAL STATEMENTS AND EXHIBITS.
(a) Financial statements of businesses acquired
The financial statements required under this item are not included in this
Current Report on Form 8-K. Such financial statements will be filed by
amendment not later then 71 calendar days after the date that this Current
Report on Form 8-K was required to be filed.
(b) Pro forma financial information
The pro forma financial information required under this item is not included
in this Current Report on Form 8-K. Such information will be filed by
amendment not later then 71 calendar days after the date that this Current
Report on Form 8-K was required to be filed.
(c) Exhibits
Exhibit
Number Description of Exhibit
3.1 Amendment to the By-Laws of Rayovac Corporation,
effective as of February 7, 2005
4.1 Indenture dated as of February 7, 2005 by and
among Rayovac Corporation, certain of Rayovac
Corporation's domestic subsidiaries and U.S. Bank
National Association
4.2 Third Supplemental Indenture dated as of February
7, 2005 to the Indenture dated as of September 30,
2003 by and among Rayovac Corporation, certain of
Rayovac Corporation's domestic subsidiaries and
U.S. Bank National Association
4.3 Registration Rights Agreement dated as of February
7, 2005 by and between Rayovac Corporation,
certain of Rayovac's domestic
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subsidiaries, Banc of America Securities LLC,
Citigroup Global Markets Inc., Merrill Lynch,
Pierce, Fenner & Smith Incorporated and ABN AMRO
Incorporated
10.1 Fourth Amended and Restated Credit Agreement dated
as of February 7, 2005 by and among Rayovac
Corporation, the Subsidiary Borrowers named
therein, Bank of America, N.A., Citicorp North
America, Inc., Merrill Lynch Capital Corporation,
the other lenders party thereto, Banc of America
Securities LLC, Citigroup Global Markets Inc. and
Merrill Lynch, Pierce, Fenner & Smith Incorporated
10.2 Security Agreement dated February 7, 2005 made by
Rayovac Corporation and the other persons
signatory thereto
10.3 ROV Guaranty dated as of February 7, 2005 made by
certain subsidiaries of Rayovac Corporation
10.4 KGaA Guaranty dated as of February 7, 2005 made by
Rayovac Corporation and certain subsidiaries of
Rayovac Corporation
10.5 UK Guaranty dated as of February 7, 2005 made by
Rayovac Corporation and certain subsidiaries of
Rayovac Corporation
10.6 Registration Rights Agreement dated as of
February 7, 2005 by and between Rayovac
Corporation and certain former shareholders of
United Industries Corporation
10.7 Standstill Agreement dated as of February 7, 2005
by and between Rayovac Corporation, Thomas H. Lee
Equity Fund IV, L.P., THL Equity Advisors IV, LLC,
Thomas H. Lee Partners, L.P. and Thomas H. Lee
Advisors, L.L.C.
99.1 Press release dated February 7, 2005
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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.
Date: February 11, 2005 RAYOVAC CORPORATION
By: /s/ Randall J. Steward
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Name: Randall J. Steward
Title: Executive Vice President and
Chief Financial Officer
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EXHIBIT INDEX
Exhibit
Number Description of Exhibit
3.1 Amendment to the By-Laws of Rayovac Corporation, effective as of
February 7, 2005
4.1 Indenture dated as of February 7, 2005 by and among Rayovac
Corporation, certain of Rayovac Corporation's domestic
subsidiaries and U.S. Bank National Association
4.2 Third Supplemental Indenture dated as of February 7, 2005 to the
Indenture dated as of September 30, 2003 by and among Rayovac
Corporation, certain of Rayovac Corporation's domestic
subsidiaries and U.S. Bank National Association
4.3 Registration Rights Agreement dated as of February 7, 2005 by and
between Rayovac Corporation, certain of Rayovac's domestic
subsidiaries, Banc of America Securities LLC, Citigroup Global
Markets Inc., Merrill Lynch, Pierce, Fenner & Smith Incorporated
and ABN AMRO Incorporated
10.1 Fourth Amended and Restated Credit Agreement dated as of February
7, 2005 by and among Rayovac Corporation, the Subsidiary
Borrowers named therein, Bank of America, N.A., Citicorp North
America, Inc., Merrill Lynch Capital Corporation, the other
lenders party thereto, Banc of America Securities LLC, Citigroup
Global Markets Inc. and Merrill Lynch, Pierce, Fenner & Smith
Incorporated
10.2 Security Agreement dated February 7, 2005 made by Rayovac
Corporation and the other persons signatory thereto
10.3 ROV Guaranty dated as of February 7, 2005 made by certain
subsidiaries of Rayovac Corporation
10.4 KGaA Guaranty dated as of February 7, 2005 made by Rayovac
Corporation and certain subsidiaries of Rayovac Corporation
10.5 UK Guaranty dated as of February 7, 2005 made by Rayovac
Corporation and certain subsidiaries of Rayovac Corporation
10.6 Registration Rights Agreement dated as of February 7, 2005
by and between Rayovac Corporation and certain former
shareholders of United Industries Corporation
10.7 Standstill Agreement dated as of February 7, 2005 by and between
Rayovac Corporation, Thomas H. Lee Equity Fund IV, L.P., THL
Equity Advisors IV, LLC, Thomas H. Lee Partners, L.P. and Thomas
H. Lee Advisors, L.L.C.
99.1 Press release dated February 7, 2005
14
EXHIBIT 3.1
Amendment to Section III.1 of the Bylaws of Rayovac Corporation
Section III.1 of the Bylaws of Rayovac Corporation was amended to read in its
entirety as follows:
III.1 General Powers and Number. The business and affairs of the
Corporation shall be managed by its Board of Directors. The number of
directors shall be fixed from time to time by the Board of Directors,
but in no event shall the number be greater than twelve (12) nor fewer
than five (5).
EXHIBIT 4.1
RAYOVAC CORPORATION
7 3/8% SENIOR SUBORDINATED NOTES DUE 2015
___________________________________
INDENTURE
Dated as of February 7, 2005
___________________________________
U.S. Bank National Association
Trustee
CROSS-REFERENCE TABLE*
Trust Indenture Act Indenture
Section Section
310(a)(1)............................................................ 7.10
(a)(2).......................................................... 7.10
(a)(5).......................................................... 7.10
(b)............................................................. 7.10
311(a)............................................................... 7.11
(b)............................................................. 7.11
312(a)............................................................... 2.05
(b)............................................................. 12.03
(c)............................................................. 12.03
313(a)............................................................... 7.06
(b)(2).......................................................... 7.06
(c)............................................................. 7.06
12.02
(d)............................................................. 7.06
314(a)............................................................... 4.03
12.05
(c)............................................................. 12.04
(e)............................................................. 12.05
315(a)............................................................... 7.01(b)
(b)............................................................. 7.05
(c)............................................................. 7.01(a)
(d)............................................................. 7.01(c)
(e)............................................................. 6.11
316(a)(last sentence)................................................ 2.09
(a)(1)(A)....................................................... 6.05
(a)(1)(B)....................................................... 6.04
(b)............................................................. 6.07
(c)............................................................. 6.15
317(a)(1)............................................................ 6.08
(b)............................................................. 6.07
(c)............................................................. 2.04
318(a)............................................................... 12.01
____________________
* This Cross-Reference Table is not part of this Indenture.
TABLE OF CONTENTS
ARTICLE 1
DEFINITIONS AND INCORPORATION BY REFERENCE
Section 1.01. Definitions.................................................................1
Section 1.02. Other Definitions..........................................................22
Section 1.03. Incorporation by Reference of Trust Indenture Act..........................22
Section 1.04. Rules of Construction......................................................23
ARTICLE 2
THE NOTES
Section 2.01. Form and Dating............................................................24
Section 2.02. Execution and Authentication...............................................25
Section 2.03. Registrar and Paying Agent.................................................25
Section 2.04. Paying Agent to Hold Money in Trust........................................26
Section 2.05. Holder Lists...............................................................26
Section 2.06. Transfer and Exchange......................................................26
Section 2.07. Replacement Notes..........................................................39
Section 2.08. Outstanding Notes..........................................................39
Section 2.09. Treasury Notes.............................................................40
Section 2.10. Certificated Notes.........................................................40
Section 2.11. Temporary Notes............................................................41
Section 2.12. Cancellation...............................................................41
Section 2.13. Defaulted Interest.........................................................41
Section 2.14. CUSIP and ISIN Numbers.....................................................42
Section 2.15. Deposit of Moneys..........................................................42
Section 2.16. Computation of Interest....................................................42
ARTICLE 3
REDEMPTION AND PREPAYMENT
Section 3.01. Notices to Trustee.........................................................42
Section 3.02. Selection of Notes to Be Redeemed..........................................42
Section 3.03. Notice of Redemption.......................................................43
Section 3.04. Effect of Notice of Redemption.............................................44
Section 3.05. Deposit of Redemption Price................................................44
Section 3.06. Notes Redeemed in Part.....................................................44
Section 3.07. Optional Redemption........................................................44
Section 3.08. Mandatory Redemption.......................................................45
Section 3.09. Offer to Purchase..........................................................45
ARTICLE 4
COVENANTS
Section 4.01. Payment of Notes...........................................................47
Section 4.02. Maintenance of Office or Agency............................................47
i
Section 4.03. Reports....................................................................47
Section 4.04. Compliance Certificate.....................................................48
Section 4.05. Taxes .....................................................................49
Section 4.06. Stay, Extension and Usury Laws.............................................49
Section 4.07. Restricted Payments........................................................49
Section 4.08. Dividend and Other Payment Restrictions Affecting Restricted Subsidiaries..52
Section 4.09. Incurrence of Indebtedness and Issuance of Preferred Stock.................53
Section 4.10. Asset Sales................................................................56
Section 4.11. Transactions with Affiliates...............................................57
Section 4.12. Liens .....................................................................59
Section 4.13. Corporate Existence........................................................59
Section 4.14. Offer to Repurchase upon Change of Control.................................59
Section 4.15. Limitation on Senior Subordinated Debt.....................................60
Section 4.16. Designation of Restricted and Unrestricted Subsidiaries....................60
Section 4.17. Payments for Consent.......................................................62
Section 4.18. Business Activities........................................................62
Section 4.19. Limitation on Issuances and Sales of Equity Interests in Restricted
Subsidiaries...............................................................62
Section 4.20. Additional Note Guarantees.................................................63
ARTICLE 5
SUCCESSORS
Section 5.01. Merger, Consolidation or Sale of Assets....................................64
Section 5.02. Successor Corporation Substituted..........................................65
ARTICLE 6
DEFAULTS 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........................................................68
Section 6.06. Limitation on Suits........................................................69
Section 6.07. Rights of Holders of Notes to Receive Payment..............................69
Section 6.08. Collection Suit by Trustee.................................................69
Section 6.09. Trustee May File Proofs of Claim...........................................69
Section 6.10. Priorities.................................................................70
Section 6.11. Undertaking for Costs......................................................70
Section 6.12. Restoration of Rights and Remedies.........................................70
Section 6.13. Rights and Remedies Cumulative.............................................71
Section 6.14. Delay or Omission Not Waiver...............................................71
Section 6.15. Record Date................................................................71
ii
ARTICLE 7
TRUSTEE
Section 7.01. Duties of Trustee..........................................................71
Section 7.02. Rights of Trustee..........................................................72
Section 7.03. Individual Rights of Trustee...............................................73
Section 7.04. Trustee's Disclaimer.......................................................73
Section 7.05. Notice of Defaults.........................................................73
Section 7.06. Reports by Trustee to the Holders of the Notes.............................74
Section 7.07. Compensation and Indemnity.................................................74
Section 7.08. Replacement of Trustee.....................................................75
Section 7.09. Successor Trustee by Merger, Etc...........................................76
Section 7.10. Eligibility; Disqualification..............................................76
Section 7.11. Preferential Collection of Claims Against Company..........................76
ARTICLE 8
LEGAL DEFEASANCE AND COVENANT DEFEASANCE; SATISFACTION AND DISCHARGE
Section 8.01. Option to Effect Legal Defeasance or Covenant Defeasance...................76
Section 8.02. Legal Defeasance and Discharge.............................................77
Section 8.03. Covenant Defeasance........................................................77
Section 8.04. Conditions to Legal Defeasance or Covenant Defeasance......................78
Section 8.05. Satisfaction and Discharge of Indenture....................................79
Section 8.06. Survival of Certain Obligations............................................80
Section 8.07. Acknowledgment of Discharge by Trustee.....................................80
Section 8.08. Deposited Money and Cash Equivalents to Be Held in Trust; Other
Miscellaneous Provisions...................................................80
Section 8.09. Repayment to Company.......................................................81
Section 8.10. Indemnity for Government Securities........................................81
Section 8.11. Reinstatement..............................................................81
ARTICLE 9
AMENDMENT, SUPPLEMENT AND WAIVER
Section 9.01. Without Consent of Holders of Notes........................................81
Section 9.02. With Consent of Holders of Notes...........................................82
Section 9.03. Compliance with Trust Indenture Act........................................84
Section 9.04. Revocation and Effect of Consents..........................................84
Section 9.05. Notation on or Exchange of Notes...........................................84
Section 9.06. Trustee to Sign Amendments, Etc............................................84
ARTICLE 10
SUBORDINATION
Section 10.01. Agreement to Subordinate...................................................85
iii
Section 10.02. Liquidation; Dissolution; Bankruptcy.......................................85
Section 10.03. Default on Designated Senior Debt..........................................85
Section 10.04. Acceleration of Securities.................................................86
Section 10.05. When Distribution Must Be Paid Over........................................86
Section 10.06. Notice by the Company......................................................87
Section 10.07. Subrogation................................................................87
Section 10.08. Relative Rights............................................................87
Section 10.09. Subordination May Not Be Impaired by the Company...........................87
Section 10.10. Distribution or Notice to Representative...................................87
Section 10.11. Rights of Trustee and Paying Agent.........................................88
Section 10.12. Authorization to Effect Subordination......................................88
ARTICLE 11
NOTE GUARANTEES
Section 11.01. Guarantee..................................................................88
Section 11.02. Subordination of Note Guarantee............................................89
Section 11.03. Limitation on Guarantor Liability..........................................90
Section 11.04. Execution and Delivery of Note Guarantee...................................90
Section 11.05. Releases Following Sale of Assets..........................................90
Section 11.06. Additional Guarantors......................................................91
Section 11.07. Notation Not Required......................................................91
Section 11.08. Successors and Assigns.....................................................91
Section 11.09. No Waiver..................................................................91
Section 11.10. Modification...............................................................91
ARTICLE 12
MISCELLANEOUS
Section 12.01. Trust Indenture Act Controls...............................................92
Section 12.02. Notices....................................................................92
Section 12.03. Communication by Holders of Notes with Other Holders of Notes..............93
Section 12.04. Certificate and Opinion as to Conditions Precedent.........................93
Section 12.05. Statements Required in Certificate or Opinion..............................93
Section 12.06. Rules by Trustee and Agents................................................94
Section 12.07. No Personal Liability of Directors, Officers, Employees and Stockholders...94
Section 12.08. Governing Law..............................................................94
Section 12.09. No Adverse Interpretation of Other Agreements..............................94
Section 12.10. Successors.................................................................94
Section 12.11. Severability...............................................................94
Section 12.12. Counterpart Originals......................................................94
Section 12.13. Table of Contents, Headings, Etc...........................................95
iv
EXHIBITS
Exhibit A FORM OF NOTE
Exhibit B FORM OF CERTIFICATE OF TRANSFER
Exhibit C FORM OF CERTIFICATE OF EXCHANGE
Exhibit D FORM OF NOTE GUARANTEE
Exhibit E FORM OF SUPPLEMENTAL INDENTURE
Schedule I GUARANTORS
v
INDENTURE dated as of February 7, 2005 among Rayovac Corporation, a
Wisconsin corporation (the "Company"), the Guarantors listed in Schedule I
hereto and U.S. Bank National Association, as trustee (the "Trustee").
The Company, the Guarantors and the Trustee agree as follows for the
benefit of each other and for the equal and proportionate benefit of the
Holders of the 7 3/8% Senior Subordinated Notes due 2015 and the Exchange Notes
(as defined herein).
ARTICLE 1
DEFINITIONS AND INCORPORATION BY REFERENCE
Section 1.01. Definitions.
"144A Global Note" means a global note in the form of Exhibit A hereto
bearing the Global Note Legend and the Private Placement Legend and deposited
with or on behalf of, and registered in the name of, the Depositary or its
nominee that shall be issued in a denomination equal to the outstanding
principal amount of the Notes sold in reliance on Rule 144A.
"Acquired Debt" means, with respect to any specified Person:
(a) Indebtedness of any other Person existing at the time such other
Person is merged with or into, or becomes a Subsidiary of, such specified
Person, whether or not such Indebtedness is incurred in connection with,
or in contemplation of, such other Person merging with or into, or
becoming a Subsidiary of, such specified Person; and
(b) Indebtedness secured by a Lien encumbering any asset acquired by
such specified Person.
"Additional Notes" means an unlimited maximum aggregate principal
amount of Notes (other than the Notes issued on the Issue Date) issued under
this Indenture in accordance with Sections 2.02 and subject to Section 4.09
hereof.
"Affiliate" of any specified Person means (a) any other Person
directly or indirectly controlling or controlled by or under direct or
indirect common control with such specified Person or (b) any executive
officer or director of such specified Person. For purposes of this definition,
"control," as used with respect to any Person, shall mean the possession,
directly or indirectly, of the power to direct or cause the direction of the
management or policies of such Person, whether through the ownership of voting
securities, by agreement or otherwise; provided that beneficial ownership of
10% or more of the Voting Stock of a Person shall be deemed to be control. For
purposes of this definition, the terms "controlling," "controlled by" and
"under common control with" shall have correlative meanings; provided further
that each of Paula Grundstucksverwaltungsgesellschaft mbH & Co.
Vermietungs-KG, Mannheim and ROSATA Grundstucksvermietungsgesellschaft mbH &
Co. Object Dischingen KG, Dusseldorf, shall not be deemed Affiliates of the
Company or any of its Restricted Subsidiaries solely by
1
virtue of the beneficial ownership by the Company or its Restricted
Subsidiaries of up to 20% of the Voting Stock of each entity.
"Agent" means any Registrar, Paying Agent or co-registrar.
"Applicable Procedures" means, with respect to any transfer or
exchange of or for beneficial interests in any Global Note, the rules and
procedures of the Depositary, Euroclear and Clearstream that apply to such
transfer or exchange.
"Asset Sale" means:
(a) the sale, lease, conveyance or other disposition of any property
or assets; provided that the sale, conveyance or other disposition of all
or substantially all of the assets of the Company and its Restricted
Subsidiaries, taken as a whole, shall be governed by the provisions of
Section 4.14 and/or Section 5.01 and not by the provisions of Section 4.10;
and
(b) the issuance of Equity Interests by any of the Company's
Restricted Subsidiaries or the sale by the Company or any Restricted
Subsidiary of Equity Interests in any of its Subsidiaries.
Notwithstanding the preceding, the following items shall be
deemed not to be Asset Sales:
(i) any single transaction or series of related transactions that
involves assets having a fair market value of less than $10.0 million;
(ii) a transfer of assets between or among the Company and its
Restricted Subsidiaries;
(iii) an issuance of Equity Interests by a Restricted Subsidiary to
the Company or to another Restricted Subsidiary of the Company;
(iv) the sale, lease or other disposition of equipment, inventory,
accounts receivable or other assets in the ordinary course of business;
(v) the sale or other disposition of Cash Equivalents;
(vi) a Restricted Payment that is permitted by Section 4.07;
(vii) any sale or disposition of any property or equipment that has
become damaged, worn out, obsolete or otherwise unsuitable or no longer
required for use in the ordinary course of the business of the Company or
its Restricted Subsidiaries;
(viii) the licensing of intellectual property in the ordinary course
of business;
(ix) any sale or other disposition deemed to occur with creating or
granting a Lien not otherwise prohibited by this Indenture; and
2
(x) upon the termination of the VARTA joint venture with VARTA AG, the
sale, transfer or other disposition of the Equity Interests in FinanceCo
(as defined in the VARTA Joint Venture Agreement) and the forgiveness of
any loans owed by VARTA AG, in each case pursuant to, and in accordance
with the terms of, the VARTA Joint Venture Agreement as in effect on the
Issue Date.
"Bankruptcy Law" means any law relating to bankruptcy, insolvency,
receivership, winding-up, liquidation, reorganization or relief of debtors or
any amendment to, succession to or change in any such law, including, without
limitation, the state bankruptcy law of the Company or the Guarantor's
jurisdiction and title 11, United States Bankruptcy Code of 1978, as amended.
"Beneficial Owner" has the meaning assigned to such term in Rule 13d-3
and Rule 13d-5 under the Exchange Act, except that in calculating the
beneficial ownership of any particular "person" (as that term is used in
Section 13(d)(3) of the Exchange Act), such "person" shall be deemed to have
beneficial ownership of all securities that such "person" has the right to
acquire by conversion or exercise of other securities, whether such right is
currently exercisable or is exercisable only upon the occurrence of a
subsequent condition. The terms "Beneficially Owns" and "Beneficially Owned"
shall have a corresponding meaning.
"Board of Directors" means (a) with respect to a corporation, the
board of directors of the corporation; (b) with respect to a partnership, the
Board of Directors of the general partner of the partnership; and (c) with
respect to any other Person, the board or committee of such Person serving a
similar function.
"Board Resolution" means a resolution certified by the Secretary or an
Assistant Secretary to have been duly adopted by the Board of Directors and to
be in full force and effect on the date of such certification.
"Broker-Dealer" has the meaning set forth in the Registration Rights
Agreement.
"Business Day" means any day other than a Legal Holiday.
"Calculation Date" has the meaning set forth in the definition of
Fixed Charge Coverage Ratio.
"Capital Lease Obligation" means, at the time any determination
thereof is to be made, the amount of the liability in respect of a capital
lease that would at that time be required to be capitalized on a balance sheet
in accordance with GAAP.
"Capital Stock" means (a) in the case of a corporation, corporate
stock; (b) in the case of an association or business entity, any and all
shares, interests, participations, rights or other equivalents (however
designated) of corporate stock; (c) in the case of a partnership or limited
liability company, partnership or membership interests (whether general or
limited); and (d) any other interest or participation that confers on a Person
the right to receive a share of the profits and losses of, or distributions of
assets of, the issuing Person.
3
"Cash Equivalents" means (a) United States dollars, Euros and British
Pounds Sterling; (b) securities issued or directly and fully guaranteed or
insured by the United States government or any agency or instrumentality
thereof (provided that the full faith and credit of the United States is
pledged in support thereof) having maturities of not more than six months from
the date of acquisition; (c) certificates of deposit and eurodollar time
deposits with maturities of six months or less from the date of acquisition,
bankers' acceptances with maturities not exceeding six months and overnight
bank deposits, in each case, with any domestic commercial bank having capital
and surplus in excess of $500.0 million and a Thomson Bank Watch Rating of "B"
or better; (d) repurchase obligations with a term of not more than seven days
for underlying securities of the types described in clauses (b) and (c) above
entered into with any financial institution meeting the qualifications
specified in clause (c) above; (e) commercial paper having the highest rating
obtainable from Moody's or S&P and in each case maturing within nine months
after the date of acquisition; (f) marketable direct obligations issued by any
state of the United States of America or any political subdivision of any such
state or any public instrumentality thereof having the highest ratings
obtainable from Moody's or S&P and maturing within six months from the date of
acquisition thereof; (g) money market funds at least 95% of the assets of which
constitute Cash Equivalents of the kinds described in clauses (a) through (f)
of this definition; and (h) in the case of a Foreign Subsidiary, local currency
held by such Foreign Subsidiary from time to time in the ordinary course of
business and Euros and British Pounds Sterling.
"Certificated Note" means a certificated note in registered
certificated form in the name of the Holder thereof and issued in accordance
with Section 2.06 hereof, in the form of Exhibit A hereto, except that such
Note shall not bear the Global Note Legend and shall not have the "Schedule of
Exchanges of Interests in the Global Note" attached thereto.
"Change of Control" means the occurrence of any of the following: (a)
the direct or indirect sale, transfer, conveyance or other disposition (other
than by way of merger or consolidation), in one or a series of related
transactions, of all or substantially all of the properties or assets of the
Company and its Restricted Subsidiaries, taken as a whole, to any "person" (as
that term is used in Section 13(d)(3) of the Exchange Act); (b) the adoption of
a plan relating to the liquidation or dissolution of the Company; (c) any
"person" or "group" (as such terms are used in Sections 13(d) and 14(d) of the
Exchange Act) becomes the ultimate Beneficial Owner, directly or indirectly, of
50% or more of the voting power of the Voting Stock of the Company; (d) the
first day on which a majority of the members of the Board of Directors of the
Company are not Continuing Directors; or (e) the Company consolidates with, or
merges with or into, any Person, or any Person consolidates with, or merges
with or into the Company, in any such event pursuant to a transaction in which
any of the outstanding Voting Stock of the Company or such other Person is
converted into or exchanged for cash, securities or other property, other than
any such transaction where (i) the Voting Stock of the Company outstanding
immediately prior to such transaction is converted into or exchanged for Voting
Stock (other than Disqualified Stock) of the surviving or transferee Person
constituting a majority of the outstanding shares of such Voting Stock of such
surviving or transferee Person (immediately after giving effect to such
issuance) 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)
becomes, directly or indirectly, the ultimate Beneficial Owner of 50% or more
of the voting power of the Voting Stock of the surviving or transferee Person.
4
"Clearstream" means Clearstream Banking, societe anonyme.
"Consolidated Cash Flow" means, with respect to any specified Person
for any period, the Consolidated Net Income of such Person for such period
plus, without duplication: (a) provision for taxes based on income or profits
of such Person and its Restricted Subsidiaries for such period, to the extent
that such provision for taxes was deducted in computing such Consolidated Net
Income; plus (b) Fixed Charges of such Person and its Restricted Subsidiaries
for such period, to the extent that any such Fixed Charges were deducted in
computing such Consolidated Net Income; plus (c) depreciation, amortization
(including amortization of goodwill and other intangibles but excluding
amortization of prepaid cash expenses that were paid in a prior period) and
other non-cash expenses (excluding any charges referred to in clauses (d), (e),
(f) and (g) without giving effect to the provisos, and any such non-cash
expense to the extent that it represents an accrual of or reserve for cash
expenses in any future period or amortization of a prepaid cash expense that
was paid in a prior period) of such Person and its Restricted Subsidiaries for
such period to the extent that such depreciation, amortization and other
non-cash expenses were deducted in computing such Consolidated Net Income; plus
(d) restructuring and related charges and other non-recurring charges incurred
by the Company in the fiscal year ended September 30, 2004, to the extent such
charges were deducted in computing Consolidated Net Income for such period;
provided that the maximum aggregate amount of such charges shall not exceed
$25.0 million; plus (e) for any period prior to the acquisition of Microlite,
any operating losses and non-recurring charges incurred in such period by
Microlite, to the extent such operating losses and non-recurring charges were
reflected in computing Consolidated Net Income for such period; provided that
the maximum aggregate amount of such operating losses and charges shall not
exceed $8.1 million; plus (f) for any period prior to the acquisition of
United, restructuring and related charges incurred in such period by United
related to its acquisition of United Pet Group, Inc. or The Nu-Gro Company, to
the extent such charges were deducted in computing Consolidated Net Income for
such period; provided that the maximum aggregate amount of such charges shall
not exceed $31.1 million; plus (g) restructuring and related charges related to
the acquisition of United and any other acquisition, incurred during any period
after September 30, 2004, and prior to September 30, 2008, to the extent such
charges were deducted in computing Consolidated Net Income for such period;
provided that the maximum aggregate amount of such charges shall not exceed
$100.0 million; minus (h) non-cash items increasing such Consolidated Net
Income for such period, other than the accrual of revenue consistent with past
practice, in each case, on a consolidated basis and determined in accordance
with GAAP.
Notwithstanding the preceding, the provision for taxes based on the
income or profits of, and the depreciation and amortization and other non-cash
expenses of, a Restricted Subsidiary of the Company shall be added to
Consolidated Net Income to compute Consolidated Cash Flow of the Company (A) in
the same proportion that the Net Income of such Restricted Subsidiary was added
to compute such Consolidated Net Income of the Company and (B) only to the
extent that a corresponding amount would be permitted at the date of
determination to be dividended or distributed to the Company by such Restricted
Subsidiary without prior governmental approval (that has not been obtained),
and without direct or indirect restriction pursuant to the terms of its charter
and all agreements, instruments, judgments, decrees, orders, statutes, rules
and governmental regulations applicable to that Subsidiary or its stockholders.
5
"Consolidated Net Income" means, with respect to any specified Person
for any period, the aggregate of the Net Income of such Person and its
Subsidiaries for such period, on a consolidated basis, determined in accordance
with GAAP; provided that:
(a) the Net Income (but not loss) of any Person that is not a
Restricted Subsidiary or that is accounted for by the equity method of
accounting shall be included only to the extent of the amount of dividends
or distributions paid in cash to the specified Person or a Restricted
Subsidiary thereof;
(b) the Net Income of any Restricted Subsidiary shall be excluded to
the extent that the declaration or payment of dividends or similar
distributions by that Restricted Subsidiary of that Net Income is not at
the date of determination permitted without any prior governmental approval
(that has not been obtained) or, 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 equityholders;
(c) the Net Income of any Person acquired during the specified period
for any period prior to the date of such acquisition shall be excluded;
(d) the cumulative effect of a change in accounting principles shall
be excluded; and
(e) notwithstanding clause (a) above, the Net Income (but not loss) of
any Unrestricted Subsidiary shall be excluded, whether or not distributed
to the specified Person or one of its Subsidiaries.
"Consolidated Net Tangible Assets" of any Person means, as of any
date, the amount which, in accordance with GAAP, would be set forth under the
caption "Total Assets" (or any like caption) on a consolidated balance sheet of
such Person and its Restricted Subsidiaries, as of the end of the most recently
ended fiscal quarter for which internal financial statements are available,
less (a) all intangible assets, including, without limitation, goodwill,
organization costs, patents, trademarks, copyrights, franchises, and research
and development costs and (b) current liabilities.
"Continuing Directors" means, as of any date of determination, any
member of the Board of Directors of the Company who (a) was a member of such
Board of Directors on the Issue Date; or (b) was nominated for election or
elected to such Board of Directors with the approval of a majority of the
Continuing Directors who were members of such Board at the time of such
nomination or election.
"Corporate Trust Office of the Trustee" shall be at the address of the
Trustee specified in Section 12.02 hereof or such other address as to which the
Trustee may give notice to the Company.
"Credit Agreement" means that certain Credit Agreement, dated the
date hereof, by and among the Company, VARTA, Bank of America, N.A., as
Administrative Agent, and the other lenders named therein, including any
related notes, Guarantees, collateral documents,
6
instruments and agreements executed in connection therewith, and in
each case as amended, modified, renewed, refunded, replaced or refinanced from
time to time, regardless of whether such amendment, modification, renewal,
refunding, replacement or refinancing is with the same financial institutions
or otherwise.
"Credit Facilities" means, one or more debt facilities (including,
without limitation, the Credit Agreement) or commercial paper facilities, in
each case with banks or other institutional lenders providing for revolving
credit loans, term loans, receivables financing (including through the sale
of receivables to such lenders or to special purpose entities formed to
borrow from such lenders against such receivables) or letters of credit, in
each case, as amended, restated, modified, renewed, refunded, replaced or
refinanced in whole or in part from time to time.
"Custodian" means the Trustee, as custodian with respect to the
Notes in global form, or any successor entity thereto.
"Default" means any event that is, or with the passage of time or
the giving of notice or both would be, an Event of Default.
"Depositary" means, with respect to the Notes issuable or issued in
whole or in part in global form, the Person specified in Section 2.03 hereof
as the Depositary with respect to the Notes, and any and all successors
thereto appointed as depositary hereunder and having become such pursuant to
the applicable provision of this Indenture.
"Designated Senior Debt" means:
(a) any Indebtedness outstanding under the Credit Agreement; and
(b) after payment in full of all Obligations under the Credit
Agreement, any other Senior Debt permitted under this Indenture the
principal amount of which is $50.0 million or more and that has been
designated by the Company as "Designated Senior Debt."
"Disqualified Stock" means any Capital Stock that, by its terms (or by
the terms of any security into which it is convertible, or for which it is
exchangeable, in each case at the option of the holder thereof), or upon the
happening of any event, matures or is mandatorily redeemable, pursuant to a
sinking fund obligation or otherwise, or redeemable at the option of the holder
thereof, in whole or in part, on or prior to the date that is one year after the
date on which the Notes mature, except to the extent such Capital Stock is
solely redeemable with, or solely exchangeable for, any Equity Interests of the
Company that are not Disqualified Stock. Notwithstanding the preceding sentence,
any Capital Stock that would constitute Disqualified Stock solely because the
holders thereof have the right to require the Company to repurchase such Capital
Stock upon the occurrence of a change of control or an asset sale shall not
constitute Disqualified Stock if the terms of such Capital Stock provide that
the Company may not repurchase or redeem any such Capital Stock pursuant to such
provisions unless such repurchase or redemption complies with Section 4.07. The
term "Disqualified Stock" shall also include any options, warrants or other
rights that are convertible into Disqualified Stock or that are
7
redeemable at the option of the holder, or required to be redeemed, prior
to the date that is one year after the date on which the Notes mature.
"Domestic Subsidiary" means any Restricted Subsidiary of the Company
other than a Restricted Subsidiary that is (a) a "controlled foreign
corporation" under Section 957 of the Internal Revenue Code or (b) a Subsidiary
of any such controlled foreign corporation.
"Equity Interests" means Capital Stock and all warrants, options or
other rights to acquire Capital Stock (but excluding any debt security that is
convertible into, or exchangeable for, Capital Stock).
"Equity Offering" means a public or private offer and sale of common
stock (other than Disqualified Stock) of the Company (other than common stock
sold to a Subsidiary of the Company).
"Euroclear" means Euroclear S.A./N.V., as operator of the Euroclear
System.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Exchange Notes" means the Notes issued in the Exchange Offer in
accordance with Section 2.06(f) hereof.
"Exchange Offer" has the meaning set forth in the Registration Rights
Agreement or any similar agreement with respect to any Additional Notes.
"Exchange Offer Registration Statement" has the meaning set forth in
the Registration Rights Agreement or any similar agreement with respect to any
Additional Notes.
"Existing Indebtedness" means the aggregate principal amount of
Indebtedness of the Company and its Subsidiaries (other than Indebtedness under
the Credit Agreement) in existence on the Issue Date after giving effect to the
acquisition of United and, the application of the proceeds of the Notes and any
Indebtedness under the Credit Agreement borrowed on the Issue Date, until such
amounts are repaid.
"fair market value" means the price that would be paid in an
arm's-length transaction between an informed and willing seller under no
compulsion to sell and an informed and willing buyer under no compulsion to
buy, as determined in good faith by the Board of Directors, whose determination
shall be conclusive if evidenced by a Board Resolution.
"Fixed Charge Coverage Ratio" means, with respect to any specified
Person for any period, the ratio of the Consolidated Cash Flow of such Person
for such period to the Fixed Charges of such Person for such period. In the
event that the specified Person or any of its Subsidiaries incurs, assumes,
Guarantees, repays, repurchases or redeems any Indebtedness or issues,
repurchases or redeems preferred stock subsequent to the commencement of the
period for which the Fixed Charge Coverage Ratio is being calculated and on or
prior to the date on which the event for which the calculation of the Fixed
Charge Coverage Ratio is made (the "Calculation Date"), then the Fixed Charge
Coverage Ratio shall be calculated giving pro forma effect to such incurrence,
assumption, Guarantee, repayment, repurchase or redemption of
8
Indebtedness, or such issuance, repurchase or redemption of preferred stock,
and the use of the proceeds therefrom as if the same had occurred at the
beginning of the applicable four-quarter reference period.
In addition, for purposes of calculating the Fixed Charge Coverage
Ratio:
(a) acquisitions and dispositions of business entities or property and
assets constituting a division or line of business of any Person that have
been made by the specified Person or any of its Restricted Subsidiaries,
including through mergers or consolidations and including any related
financing transactions, during the four-quarter reference period or
subsequent to such reference period and on or prior to the Calculation Date
shall be given pro forma effect as if they had occurred on the first day of
the four-quarter reference period and Consolidated Cash Flow for such
reference period shall be calculated on a pro forma basis in accordance
with Regulation S-X under the Securities Act, but without giving effect to
clause (c) of the proviso set forth in the definition of Consolidated Net
Income; (b) the Consolidated Cash Flow attributable to discontinued
operations, as determined in accordance with GAAP, shall be excluded; (c)
the Fixed Charges attributable to discontinued operations, as determined in
accordance with GAAP shall be excluded, but only to the extent that the
obligations giving rise to such Fixed Charges shall not be obligations of
the specified Person or any of its Subsidiaries following the Calculation
Date; and (d) consolidated interest expense attributable to interest on any
Indebtedness (whether existing or being incurred) computed on a pro forma
basis and bearing a floating interest rate shall be computed as if the rate
in effect on the Calculation Date (taking into account any interest rate
option, swap, cap or similar agreement applicable to such Indebtedness if
such agreement has a remaining term in excess of 12 months or, if shorter,
at least equal to the remaining term of such Indebtedness) had been the
applicable rate for the entire period.
"Fixed Charges" means, with respect to any specified Person for any
period, the sum, without duplication, of (a) the consolidated interest expense
of such Person and its Restricted Subsidiaries for such period, whether paid or
accrued, including, without limitation, amortization of debt issuance costs and
original issue discount, non-cash interest payments, the interest component of
any deferred payment obligations, the interest component of all payments
associated with Capital Lease Obligations, commissions, discounts and other fees
and charges incurred in respect of letter of credit or bankers' acceptance
financings, and net of the effect of all payments made, received or accrued in
connection with Hedging Obligations; plus (b) the consolidated interest of such
Person and its Restricted Subsidiaries that was capitalized during such period;
plus (c) any interest expense on Indebtedness of another Person that is
Guaranteed by such Person or one of its Restricted Subsidiaries or secured by a
Lien on assets of such Person or one of its Restricted Subsidiaries, whether or
not such Guarantee or Lien is called upon; plus (d) the product of (i) all
dividends, whether paid or accrued and whether or not in cash, on any series of
Disqualified Stock or preferred stock of such Person or any of its Restricted
Subsidiaries, other than (A) dividends on Equity Interests payable solely in
Equity Interests of the Company (other than Disqualified Stock) or (B) dividends
to the Company or a Restricted Subsidiary of the Company, times (ii) a fraction,
the numerator of which is one and the denominator of which is one minus the then
current combined federal, state and local statutory tax rate of such Person,
expressed as a decimal, in each case, on a consolidated basis and in
9
accordance with GAAP; provided that Fixed Charges shall not include any
interest expense of, or dividends paid by, VARTA to VARTA AG to the extent that
the Company or a Restricted Subsidiary of the Company receives interest or
dividends in cash from VARTA AG in connection with the VARTA Joint Venture
Agreement as in effect on the Issue Date.
"Foreign Subsidiary" means any Restricted Subsidiary of the Company
other than a Domestic Subsidiary.
"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, the opinions and pronouncements of
the Public Company Accounting Oversight Board and in the statements and
pronouncements of the Financial Accounting Standards Board or in such other
statements by such other entity as have been approved by a significant segment
of the accounting profession, which are in effect on the Issue Date.
"Global Note Legend" means the legend set forth in Section
2.06(g)(ii), which is required to be placed on all Global Notes issued under
this Indenture.
"Global Notes" means, individually and collectively, each of the
Restricted Global Notes and the Unrestricted Global Notes, issued in accordance
with certain sections of this Indenture and deposited with or on behalf of, and
registered in the name of, the Depositary or its nominee.
"Government Securities" means direct obligations of, or obligations
guaranteed by, the United States of America for the payment of which guarantee
or obligations the full faith and credit of the United States is pledged.
"Guarantee" means, as to any Person, a guarantee other than by
endorsement of negotiable instruments for collection in the ordinary course of
business, direct or indirect, in any manner including, without limitation, by
way of a pledge of assets or through letters of credit or reimbursement
agreements in respect thereof, of all or any part of any Indebtedness of
another Person.
"Guarantors" means:
(a) each direct or indirect Domestic Subsidiary of the Company on the
Issue Date; and
(b) any other subsidiary that executes a Note Guarantee in accordance
with the provisions of this Indenture;
and their respective successors and assigns until released from their
obligations under their Note Guarantees and this Indenture in accordance with
the terms of this Indenture.
"Hedging Obligations" means, with respect to any specified Person, the
obligations of such Person under (a) interest rate swap agreements, interest
rate cap agreements, interest rate collar agreements and other agreements or
arrangements designed for the purpose of fixing, hedging or swapping interest
rate risk; (b) commodity swap agreements, commodity option
10
agreements, forward contracts and other agreements or arrangements designed for
the purpose of fixing, hedging or swapping commodity price risk; and (c)
foreign exchange contracts, currency swap agreements and other agreements or
arrangements designed for the purpose of fixing, hedging or swapping foreign
currency exchange rate risk.
"Holder" means a Person in whose name a Note is registered.
"incur" means, with respect to any Indebtedness, to incur, create,
issue, assume, Guarantee or otherwise become directly or indirectly liable for
or with respect to, or become responsible for, the payment of, contingently or
otherwise, such Indebtedness; provided that (a) any Indebtedness of a Person
existing at the time such Person becomes a Restricted Subsidiary of the Company
shall be deemed to be incurred by such Restricted Subsidiary at the time it
becomes a Restricted Subsidiary of the Company; and (b) neither the accrual of
interest nor the accretion of original issue discount nor the payment of
interest in the form of additional Indebtedness with the same terms and the
payment of dividends on Disqualified Stock in the form of additional shares of
the same class of Disqualified Stock (to the extent provided for when the
Indebtedness or Disqualified Stock on which such interest or dividend is paid
was originally issued) shall be considered an incurrence of Indebtedness;
provided that in each case the amount thereof is for all other purposes
included in the Fixed Charges and Indebtedness of the Company or its Restricted
Subsidiary as accrued.
"Indebtedness" means, with respect to any specified Person, any
indebtedness of such Person, whether or not contingent:
(a) in respect of borrowed money;
(b) evidenced by bonds, notes, debentures or similar instruments
or letters of credit (or reimbursement agreements in respect thereof),
but excluding obligations with respect to letters of credit (including
trade letters of credit) securing obligations entered into in the
ordinary course of business of such Person to the extent such letters
of credit are not drawn upon or, if drawn upon, to the extent such
drawing is reimbursed no later than the fifth Business Day following
receipt by such Person of a demand for reimbursement);
(c) in respect of banker's acceptances;
(d) in respect of Capital Lease Obligations;
(e) in respect of the balance deferred and unpaid of the purchase
price of any property, except any such balance that constitutes an
accrued expense or trade payable;
(f) representing Hedging Obligations, other than Hedging
Obligations that are incurred in the ordinary course of business for
the purpose of fixing, hedging or swapping interest rate, commodity
price or foreign currency exchange rate risk (or to reverse or amend
any such agreements previously made for such purposes), and not for
speculative purposes, and that do not increase the Indebtedness of the
obligor outstanding at any time other than as a result of fluctuations
in interest rates, commodity prices or foreign
11
currency exchange rates or by reason of fees, indemnities and compensation
payable thereunder; or
(g) representing Disqualified Stock valued at the greater of its
voluntary or involuntary maximum fixed repurchase price plus accrued
dividends;
if and to the extent that any of the preceding items (other than letters of
credit and Hedging Obligations) would appear as liability upon a balance sheet
of the specified Person prepared in accordance with GAAP. In addition, the term
"Indebtedness" includes (x) all Indebtedness of others secured by a Lien on any
asset of the specified Person (whether or not such Indebtedness is assumed by
the specified Person), provided that the amount of such Indebtedness shall be
the lesser of (A) the fair market value of such asset at such date of
determination and (B) the amount of such Indebtedness, and (y) to the extent
not otherwise included, the Guarantee by the specified Person of any
Indebtedness of any other Person. For purposes hereof, the "maximum fixed
repurchase price" of any Disqualified Stock which does not have a fixed
repurchase price shall be calculated in accordance with the terms of such
Disqualified Stock as if such Disqualified 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 Disqualified Stock, such fair market value shall be determined in
good faith by the Board of Directors of the issuer of such Disqualified Stock.
The amount of any Indebtedness outstanding as of any date shall be
the outstanding balance at such date of all unconditional obligations as
described above and, with respect to contingent obligations, the maximum
liability upon the occurrence of the contingency giving rise to the
obligation, and shall be:
(A) the accreted value thereof, in the case of any Indebtedness
issued with original issue discount; and
(B) the principal amount thereof, together with any interest
thereon that is more than 30 days past due, in the case of any other
Indebtedness;
provided that Indebtedness shall not include:
(1) any liability for federal, state, local or other taxes;
(2) performance, surety or appeal bonds provided in the ordinary
course of business; or
(3) agreements providing for indemnification, adjustment of
purchase price or similar obligations, or Guarantees or letters of
credit, surety bonds or performance bonds securing any obligations of
the Company or any of its Restricted Subsidiaries pursuant to such
agreements, in any case incurred in connection with the disposition of
any business, assets or Restricted Subsidiary (other than Guarantees of
Indebtedness incurred by any Person acquiring all or any portion of
such business, assets or Restricted Subsidiary for the purpose of
financing such acquisition), so long as the principal amount does not
exceed the gross proceeds actually received by the Company or any
Restricted Subsidiary in connection with such disposition.
12
"Indenture" means this Indenture, as amended or supplemented from
time to time.
"Indirect Participant" means a Person who holds a beneficial
interest in a Global Note through a Participant.
"Interest Payment Date" means February 1 and August 1 of each year
to Stated Maturity.
"Internal Revenue Code" means the Internal Revenue Code of 1986,
as amended.
"Investments" means, with respect to any Person, all direct or
indirect investments by such Person in other Persons (including Affiliates)
in the forms of loans or other extensions of credit (including Guarantees,
but excluding advances to customers or suppliers in the ordinary course of
business that are, in conformity with GAAP, recorded as accounts
receivable, prepaid expenses or deposits on the balance sheet of the
Company or its Restricted Subsidiaries and endorsements for collection or
deposit arising in the ordinary course of business), advances (excluding
commission, travel, payroll and similar advances to officers and employees
made consistent with past practices), capital contributions (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), purchases or other
acquisitions for consideration of Indebtedness, Equity Interests or other
securities, together with all items that are or would be classified as
investments on a balance sheet prepared in accordance with GAAP.
If the Company or any Restricted Subsidiary of the Company sells
or otherwise disposes of any Equity Interests of any direct or indirect
Restricted Subsidiary of the Company such that, after giving effect to any
such sale or disposition, such Person is no longer a Restricted Subsidiary
of the Company, the Company shall be deemed to have made an Investment on
the date of any such sale or disposition equal to the fair market value of
the Investment in such Restricted Subsidiary not sold or disposed of in an
amount determined as provided in Section 4.07. The acquisition by the
Company or any Restricted Subsidiary of the Company of a Person that holds
an Investment in a third Person shall be deemed to be an Investment by the
Company or such Restricted Subsidiary in such third Person only if such
Investment was made in contemplation of, or in connection with, the
acquisition of such Person by the Company or such Restricted Subsidiary and
the amount of any such Investment shall be determined as provided in the
final paragraph of Section 4.07.
"Issue Date" means the date on which $700.0 million in aggregate
principal amount of the Notes were originally issued under this Indenture.
"Legal Holiday" means a Saturday, a Sunday or a day on which
commercial banks in The City of New York or at a place of payment are
authorized or required by law, regulation or executive order to remain
closed. If a payment date is a Legal Holiday at a place of payment, payment
may be made at that place on the next succeeding day that is not a Legal
Holiday, and no interest on such payment shall accrue for the intervening
period.
"Letter of Transmittal" means the letter of transmittal to be
prepared by the Company and sent to all Holders of the Notes for use by
such Holders in connection with the Exchange Offer.
13
"Lien" means, with respect to any asset, any mortgage, lien,
pledge, charge, security interest or encumbrance of any kind in respect of
such asset, whether or not filed, recorded or otherwise perfected under
applicable law, including any conditional sale or other title retention
agreement, any lease in the nature thereof, any option or other agreement
to sell or give a security interest in and any filing of or agreement to
give any financing statement under the Uniform Commercial Code (or
equivalent statutes) of any jurisdiction.
"Liquidated Damages" means the additional amounts (if any) payable
by the Company in the event of a Registration Default under, and as defined
in, the Registration Rights Agreement.
"Maturity" means, with respect to any Indebtedness, the date on
which any principal of such Indebtedness becomes due and payable as therein
or herein provided, whether at the Stated Maturity with respect to such
principal or by declaration of acceleration, call for redemption or
purchase or otherwise.
"Microlite" means Microlite S.A. and its successors or assigns.
"Microlite Purchase Agreement" means the Share Purchase Agreement
by and among the Company, ROV Holding, Inc. and the shareholders of
Microlite dated February 21, 2004.
"Moody's" means Moody's Investors Service, Inc. or any successor
to the rating agency business thereof.
"Net Income" means, with respect to any specified Person, the net
income (loss) of such Person, determined in accordance with GAAP and before
any reduction in respect of preferred stock dividends, excluding, however,
(a) any gain or loss, together with any related provision for taxes on such
gain or loss, realized in connection with (i) any sale of assets outside
the ordinary course of business of such Person; or (ii) the disposition of
any securities by such Person or any of its Restricted Subsidiaries or the
extinguishment of any Indebtedness of such Person or any of its Restricted
Subsidiaries; and (b) any extraordinary gain or loss, together with any
related provision for taxes on such extraordinary gain or loss.
"Net Proceeds" means the aggregate cash proceeds, including
payments in respect of deferred payment obligations (to the extent
corresponding to the principal, but not the interest component, thereof)
received by the Company or any of its Restricted Subsidiaries in respect of
any Asset Sale (including, without limitation, any cash received upon the
sale or other disposition of any non-cash consideration received in any
Asset Sale), net of (a) the direct costs relating to such Asset Sale,
including, without limitation, legal, accounting and investment banking
fees, and sales commissions, and any relocation expenses incurred as a
result thereof; (b) taxes paid or payable as a result thereof, in each
case, after taking into account any available tax credits or deductions
arising therefrom and any tax sharing arrangements in connection therewith;
(c) amounts required to be applied to the repayment of Indebtedness or
other liabilities, secured by a Lien on the asset or assets that were the
subject of such Asset Sale, or required to be paid as a result of such
sale; and (d) any reserve for adjustment in respect of the sale price of
such asset or assets established in accordance with GAAP.
14
"Ningbo Baowang" means Ningbo Baowang Battery Company, Ltd. and
its successors or assigns.
"Non-U.S. Person" means a Person who is not a U.S. Person.
"Note Guarantee" means the Guarantee by each Guarantor of the
Company's payment obligations under this Indenture and on the Notes,
executed pursuant to this Indenture.
"Notes" means the 7 3/8% Senior Subordinated Notes due 2015 of the
Company issued on the Issue Date, the Exchange Notes and the Additional
Notes. The Notes shall be treated as a single class for all purposes under
this Indenture.
"Obligations" means any principal, interest, penalties, fees,
indemnifications, reimbursements, damages and other liabilities payable under
the documentation governing any Indebtedness.
"Officer" means, with respect to any Person, the Chairman of the
Board, the Chief Executive Officer, the President, the Chief Operating
Officer, the Chief Financial Officer, the Treasurer, any Assistant
Treasurer, the Controller, the Secretary or any Vice-President of such
Person.
"Officers' Certificate" means a certificate signed on behalf of
the Company by two Officers of the Company, one of whom must be the
principal executive officer, the principal financial officer, the
treasurer, or the principal accounting officer of the Company, that meets
the requirements of Section 12.05 hereof.
"Opinion of Counsel" means an opinion from legal counsel that
meets the requirements of Section 12.05 hereof. The counsel may be an
employee of or counsel to the Company, any subsidiary of the Company or the
Trustee.
"Participant" means, with respect to the Depositary, Euroclear or
Clearstream, a Person who has an account with the Depositary, Euroclear or
Clearstream, respectively (and, with respect to The Depository Trust
Company, shall include Euroclear and Clearstream).
"Permitted Business" means any business conducted or proposed to
be conducted by the Company and its Restricted Subsidiaries on the Issue
Date and other businesses similar or reasonably related, ancillary or
incidental thereto or reasonable extensions thereof.
"Permitted Investments" means:
(a) any Investment in the Company or in a Restricted Subsidiary
of the Company;
(b) any Investment in Cash Equivalents;
(c) any Investment by the Company or any Restricted Subsidiary of
the Company in a Person, if as a result of such Investment:
15
(i) such Person becomes a Restricted Subsidiary of the
Company; or
(ii) such Person is merged, consolidated or amalgamated with
or into, or transfers or conveys substantially all of its assets
to, or is liquidated into, the Company or a Restricted Subsidiary
of the Company;
(d) any Investment made as a result of the receipt of non-cash
consideration from an Asset Sale that was made pursuant to and in
compliance with Section 4.10;
(e) Investments to the extent acquired in exchange for the
issuance of Equity Interests (other than Disqualified Stock) of the
Company;
(f) Hedging Obligations that are incurred in the ordinary course
of business for the purpose of fixing, hedging or swapping interest
rate, commodity price or foreign currency exchange rate risk (or to
reverse or amend any such agreements previously made for such
purposes), and not for speculative purposes, and that do not increase
the Indebtedness of the obligor outstanding at any time other than as a
result of fluctuations in interest rates, commodity prices or foreign
currency exchange rates or by reason of fees, indemnities and
compensation payable thereunder;
(g) stock, obligations or securities received in satisfaction of
judgments;
(h) Investments in securities of trade debtors or customers
received pursuant to any plan of reorganization or similar arrangement
upon the bankruptcy or insolvency of such trade creditors or customers
or in good faith settlement of delinquent obligations of such trade
debtors or customers or in compromise or resolution of litigation,
arbitration or other disputes with Persons who are not Affiliates; and
(i) other Investments in any Person that is not an Affiliate of
the Company (other than a Restricted Subsidiary) having an aggregate
fair market value (measured on the date each such Investment was made
and without giving effect to subsequent changes in value), when taken
together with all other Investments made pursuant to this clause (i)
since the Issue Date, not to exceed $30.0 million.
"Permitted Junior Securities" means (a) Equity Interests in the
Company or any Guarantor or any other business entity provided for by a plan of
reorganization; and (b) debt securities of the Company or any Guarantor or any
other business entity provided for by a plan of reorganization that are
subordinated to the payment of all Senior Debt and any debt securities issued
in exchange for Senior Debt to substantially the same extent as, or to a
greater extent than, the Notes and the Note Guarantees are subordinated to
Senior Debt under this Indenture.
"Permitted Liens" means:
(a) Liens on the assets of the Company and any Guarantor securing
Senior Debt that was permitted by the terms of this Indenture to be
incurred;
(b) Liens in favor of the Company or any Restricted Subsidiary;
16
(c) Liens on property of a Person existing at the time such Person is
merged with or into or consolidated with the Company or any Restricted
Subsidiary of the Company; provided that such Liens were in existence prior
to the contemplation of such merger or consolidation and do not extend to
any assets other than those of the Person merged into or consolidated with
the Company or the Restricted Subsidiary;
(d) Liens on property existing at the time of acquisition thereof by
the Company or any Restricted Subsidiary of the Company, provided that such
Liens were in existence prior to the contemplation of such acquisition and
do not extend to any property other than the property so acquired by the
Company or the Restricted Subsidiary;
(e) Liens existing on the Issue Date;
(f) Liens securing Permitted Refinancing Indebtedness; provided that
such Liens do not extend to any property or assets other than the property
or assets that secure the Indebtedness being refinanced;
(g) Liens incurred in the ordinary course of business of the Company
or any Restricted Subsidiary of the Company with respect to obligations
that do not exceed $25.0 million at any one time outstanding; and
(h) Liens on the assets of a Foreign Subsidiary securing Indebtedness
of a Foreign Subsidiary that was permitted by the terms of the Indenture to
be incurred.
"Permitted Refinancing Indebtedness" means any Indebtedness of the
Company or any of its Restricted Subsidiaries issued in exchange for, or
the net proceeds of which are used to extend, refinance, renew, replace,
defease or refund other Indebtedness of the Company or any of its Restricted
Subsidiaries (other than intercompany Indebtedness); provided that:
(a) the principal amount (or accreted value, if applicable) of such
Permitted Refinancing Indebtedness does not exceed the principal amount (or
accreted value, if applicable) of the Indebtedness so extended, refinanced,
renewed, replaced, defeased or refunded (plus all accrued interest thereon
and the amount of any reasonably determined premium necessary to accomplish
such refinancing and such reasonable expenses incurred in connection
therewith);
(b) such Permitted Refinancing Indebtedness has a final maturity date
later than the final maturity date of, and has a Weighted Average Life to
Maturity equal to or greater than the Weighted Average Life to Maturity of,
the Indebtedness being extended, refinanced, renewed, replaced, defeased or
refunded;
(c) if the Indebtedness being extended, refinanced, renewed, replaced,
defeased or refunded is subordinated in right of payment to the Notes or
the Note Guarantees, such Permitted Refinancing Indebtedness has a final
maturity date later than the final maturity date of, and is subordinated in
right of payment to, the Notes on terms at least as favorable to the
Holders of Notes as those contained in the documentation governing the
Indebtedness being extended, refinanced, renewed, replaced, defeased or
refunded;
17
(d) if the Indebtedness being extended, refinanced, renewed, replaced,
defeased or refunded is pari passu in right of payment with the Notes or
any Note Guarantees, such Permitted Refinancing Indebtedness is pari passu
with, or subordinated in right of payment to, the Notes or such Note
Guarantees; and
(e) such Indebtedness is incurred either by the Company or by the
Restricted Subsidiary who is the obligor on the Indebtedness being
extended, refinanced, renewed, replaced, defeased or refunded.
"Person" means any individual, corporation, partnership, joint
venture, association, joint-stock company, trust, unincorporated organization,
limited liability company or government or other entity.
"preferred stock" means, with respect to any Person, any Capital Stock
of such Person that has preferential rights to any other Capital Stock of such
Person with respect to dividends or redemption upon liquidation.
"Private Placement Legend" means the legend set forth in Section
2.06(g)(i) to be placed on all Notes issued hereunder except where otherwise
permitted by this Indenture.
"QIB" means a "qualified institutional buyer" as defined in Rule 144A.
"Record Date" for the interest payable on any Interest Payment Date
means March 15 or September 15 (whether or not a Business Day), as the case may
be, next preceding such Interest Payment Date.
"Registration Rights Agreement" means the Registration Rights
Agreement, dated February 7, 2005, among the Company, the Guarantors, Banc of
America Securities LLC, Citigroup Global Markets Inc., Merrill Lynch, Pierce,
Fenner & Smith Incorporated and ABN AMRO Incorporated.
"Regulation S" means Regulation S promulgated under the Securities Act.
"Regulation S Global Note" means a Regulation S Temporary Global Note
or a Regulation S Permanent Global Note, as appropriate.
"Regulation S Permanent Global Note" means a permanent Global Note in
the form of Exhibit A hereto bearing the Global Note Legend and the Private
Placement Legend and deposited with or on behalf of and registered in the name
of the Depositary or its nominee, issued in a denomination equal to the
outstanding principal amount of the Regulation S Temporary Global Note upon
expiration of the Restricted Period.
"Regulation S Temporary Global Note" means a temporary global Note in
the form of Exhibit A hereto bearing the Global Note Legend, the Private
Placement Legend and the Temporary Regulation S Legend and deposited with or on
behalf of and registered in the name of the Depositary or its nominee, issued
in a denomination equal to the outstanding principal amount of the Notes
initially sold in reliance on Rule 903 of Regulation S.
18
"Replacement Assets" means (a) non-current assets that shall be used
or useful in a Permitted Business or (b) all or substantially all of the assets
of a Permitted Business or a majority of the Voting Stock of any Person engaged
in a Permitted Business that shall become on the date of acquisition thereof a
Restricted Subsidiary of the Company.
"Representative" means the Trustee, agent or representative for any
Senior Debt.
"Responsible Officer" when used with respect to the Trustee, means any
officer within the Corporate Trust Administration of the Trustee (or any
successor group of the Trustee) or any other officer of the Trustee customarily
performing functions similar to those performed by any of the above designated
officers and also means, with respect to a particular corporate trust matter,
any other officer to whom such matter is referred because of his knowledge of
and familiarity with the particular subject and who shall have direct
responsibility for the administration of this Indenture.
"Restricted Certificated Note" means a Certificated Note bearing the
Private Placement Legend.
"Restricted Global Note" means individually and collectively a 144A
Global Note, a Regulation S Permanent Global Note and a Regulation S Temporary
Global Note.
"Restricted Investment" means an Investment other than a Permitted
Investment.
"Restricted Period" means the 40-day restricted period as defined in
Regulation S.
"Restricted Subsidiary" of a Person means any Subsidiary of the
referent Person that is not an Unrestricted Subsidiary.
"Rule 144" means Rule 144 promulgated under the Securities Act.
"Rule 144A" means Rule 144A promulgated under the Securities Act.
"Rule 903" means Rule 903 promulgated under the Securities Act.
"Rule 904" means Rule 904 promulgated the Securities Act.
"S&P" means Standard and Poor's Rating Services or any successor to
the rating agency business thereof and its successors.
"Sale and Leaseback Transaction" means, with respect to any Person,
any transaction involving any of the assets or properties of such Person
whether now owned or hereafter acquired, whereby such Person sells or transfers
such assets or properties and then or thereafter leases such assets or
properties or any part thereof or any other assets or properties which such
Person intends to use for substantially the same purpose or purposes as the
assets or properties sold or transferred.
"SEC" means the Securities and Exchange Commission.
19
"Securities Act" means the Securities Act of 1933, as amended.
"Senior Debt" means:
(a) all Indebtedness of the Company or any Guarantor outstanding
under Credit Facilities and all Hedging Obligations with respect thereto;
(b) any other Indebtedness of the Company or any Guarantor permitted
to be incurred under the terms of this Indenture, unless the instrument
under which such Indebtedness is incurred expressly provides that it is on
a parity with or subordinated in right of payment to the Notes or any Note
Guarantee; and
(c) all Obligations with respect to the items listed in the preceding
clauses (a) and (b).
Notwithstanding anything to the contrary in the preceding paragraph,
Senior Debt shall not include:
(i) any liability for federal, state, local or other taxes owed or
owing by the Company or any Guarantor;
(ii) any Indebtedness of the Company or any Guarantor to any of their
Subsidiaries or other Affiliates;
(iii) any trade payables;
(iv) the portion of any Indebtedness that is incurred in violation of
this Indenture;
(v) any Indebtedness of the Company or any Guarantor that, when
incurred, was without recourse to the Company or such Guarantor;
(vi) any repurchase, redemption or other obligation in respect of
Disqualified Stock; or
(vii) the 8 1/2% Senior Subordinated Notes due 2013 of the Company.
"Shelf Registration Statement" means the Shelf Registration Statement
as defined in the Registration Rights Agreement.
"Significant Subsidiary" means any Subsidiary that would constitute a
"significant subsidiary" within the meaning of Article 1 of Regulation S-X of
the Securities Act.
"Stated Maturity" means, with respect to any installment of interest
or principal on any series of Indebtedness, the date on which such payment of
interest or principal was scheduled to be paid in the original documentation
governing such Indebtedness, and shall not include any contingent obligations
to repay, redeem or repurchase any such interest or principal prior to the date
originally scheduled for the payment thereof.
20
"Subsidiary" means, with respect to any specified Person: (a) any
corporation, association or other business entity of which more than 50% of the
total voting power of shares of Capital Stock entitled (without regard to the
occurrence of any contingency) to vote in the election of directors, managers
or trustees thereof is at the time owned or controlled, directly or indirectly,
by such Person or one or more of the other Subsidiaries of that Person (or a
combination thereof); and any partnership (i) the sole general partner or the
managing general partner of which is such Person or a Subsidiary of such Person
or (ii) the only general partners of which are such Person or one or more
Subsidiaries of such Person (or any combination thereof).
"Temporary Regulation S Legend" means the legend set forth in Section
2.06(h), which is required to be placed on the Regulation S Temporary Global
Note.
"TIA" means the Trust Indenture Act of 1939, as amended (15 U.S.C.
ss.ss. 77aaa-77bbbb) as in effect on the date on which this Indenture is
qualified under the TIA.
"Trustee" means the party named as such in the preamble to this
Indenture until a successor replaces it in accordance with this Indenture and
thereafter means the successor serving hereunder.
"United" means United Industries Corporation.
"Unrestricted Certificated Note" means one or more Certificated Notes
that do not bear and are not required to bear the Private Placement Legend.
"Unrestricted Global Note" means a permanent global Note in the form
of Exhibit A attached hereto that bears the Global Note Legend and that has the
"Schedule of Exchanges of Interests in the Global Note" attached thereto, and
that is deposited with or on behalf of and registered in the name of the
Depositary, representing a series of Notes that do not bear the Private
Placement Legend.
"Unrestricted Subsidiary" means any Subsidiary of the Company that is
designated by the Board of Directors of the Company as an Unrestricted
Subsidiary pursuant to a Board Resolution in compliance with Section 4.16 and
any Subsidiary of such Subsidiary.
"U.S. Person" means a U.S. person as defined in Rule 902(o) under the
Securities Act.
"VARTA" means Varta Geratebatterie GmbH and its successors or
assignees.
"VARTA Joint Venture Agreement" means the agreement among VARTA AG,
the Company and ROV German Limited GmbH dated July 28, 2002, as amended.
"Voting Stock" of any Person as of any date means the Capital Stock of
such Person that is at the time entitled to vote in the election of the Board
of Directors of such Person.
"Weighted Average Life to Maturity" means, when applied to any
Indebtedness at any date, the number of years obtained by dividing: (a) the sum
of the products obtained by multiplying (i) the amount of each then remaining
installment, sinking fund, serial maturity or
21
other required payments of principal, including payment at final maturity, in
respect thereof, by (ii) the number of years (calculated to the nearest
one-twelfth) that shall elapse between such date and the making of such
payment; by (b) the then outstanding principal amount of such Indebtedness.
"Wholly Owned Restricted Subsidiary" of any specified Person means a
Restricted Subsidiary of such Person all of the outstanding Capital Stock or
other ownership interests of which (other than directors' qualifying shares or
Investments by foreign nationals mandated by applicable law) shall at the time
be owned by such Person or by one or more Wholly Owned Restricted Subsidiaries
of such Person and one or more Wholly Owned Restricted Subsidiaries of such
Person.
Section 1.02. Other Definitions.
Defined in
Term Section
---- -------
"Affiliate Transaction".................................. 4.11
"Asset Sale Offer"....................................... 4.10
"Authentication Order"................................... 2.02
"Change of Control Offer"................................ 4.14
"Change of Control Payment".............................. 4.14
"Change of Control Payment Date"......................... 4.14
"Company"................................................ Preamble
"Covenant Defeasance".................................... 8.03
"DTC".................................................... 2.03
"Event of Default"....................................... 6.01
"Excess Proceeds"........................................ 4.10
"Legal Defeasance"....................................... 8.02
"Offer Amount"........................................... 3.09
"Offer Period"........................................... 3.09
"Paying Agent"........................................... 2.03
"Payment Blockage Notice"................................ 10.03
"Payment Default"........................................ 6.01
"Permitted Debt"......................................... 4.09
"Purchase Date".......................................... 3.09
"Registrar".............................................. 2.03
"Repurchase Offer"....................................... 3.09
"Restricted Payments".................................... 4.07
Section 1.03. Incorporation by Reference of Trust Indenture Act. The
mandatory provisions of the TIA that are required to be a part of and govern
indentures qualified under the TIA are incorporated by reference in and are a
part of this Indenture, whether or not this Indenture is so qualified. Whenever
this Indenture refers to a provision of the TIA, the 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:
22
"indenture securities" means the Notes;
"indenture security Holder" means a Holder of a Note;
"indenture to be qualified" means this Indenture;
"indenture trustee" or "institutional trustee" means the Trustee; and
"obligor" on the Notes means the Company and any successor obligor
upon the Notes.
All other terms used in this Indenture that are defined by the TIA,
defined by TIA reference to another statute or defined by SEC rule under the
TIA have the meanings so assigned to them.
Section 1.04. Rules of Construction. Unless the context otherwise
requires:
(a) a term has the meaning assigned to it;
(b) "or" is not exclusive;
(c) "including" or "include" means including or include without
limitation;
(d) words in the singular include the plural and words in the plural
include the singular;
(e) the words "herein," "hereof" and "hereunder" and other words of
similar import refer to this Indenture as a whole and not to any
particular Article, Section, clause or other subdivision;
(f) "$," "U.S. Dollars" and "United States Dollars" each refer to
United States dollars, or such other money of the United States
that at the time of payment is legal tender for payment of public
and private debts;
(g) provisions apply to successive events and transactions;
(h) references to sections of or rules under the Securities Act shall
be deemed to include substitute, replacement or successor
sections or rules adopted by the SEC from time to time; and
(i) unless the context otherwise requires, any reference to an
"Article" or a "Section" refers to an Article or a Section, as
the case may be, of this Indenture.
23
ARTICLE 2
THE NOTES
Section 2.01. Form and Dating. (a) General. The Notes and the
Trustee's certificate of authentication shall be substantially in the form of
Exhibit A hereto. The Notes may have notations, legends or endorsements
required by law, stock exchange rule or usage. Each Note shall be dated the
date of its authentication. The Notes shall be issued in registered, global
form and shall be in denominations of $1,000 and integral multiples of $1,000
in excess thereof.
The terms and provisions contained in the Notes shall constitute, and
are hereby expressly made, a part of this Indenture and the Company, the
Guarantors and the Trustee, by their execution and delivery of this Indenture,
expressly agree to such terms and provisions and to be bound thereby. However,
to the extent any provision of any Note conflicts with this Indenture, this
Indenture shall govern and be controlling.
(b) Global Notes. Notes issued in global form shall be substantially
in the form of Exhibit A attached hereto (including the Global Note Legend
thereon and the "Schedule of Exchanges of Interests in the Global Note"
attached thereto). Notes issued in definitive form shall be substantially
in the form of Exhibit A attached hereto (but without the Global Note
Legend thereon and without the "Schedule of Exchanges of Interests in the
Global Note" attached thereto). Each Global Note shall represent such of
the outstanding Notes as shall be specified therein and each shall provide
that it shall represent the aggregate principal amount of outstanding Notes
from time to time endorsed thereon and that the aggregate principal amount
of outstanding Notes represented thereby may from time to time be reduced
or increased, as appropriate, to reflect exchanges and redemptions. Any
endorsement of a Global Note to reflect the amount of any increase or
decrease in the aggregate principal amount of outstanding Notes represented
thereby shall be made by the Trustee, in accordance with instructions given
by the Holder thereof as required by Section 2.06 hereof.
(c) Temporary Global Notes. Notes offered and sold in reliance on
Regulation S shall be issued initially in the form of the Regulation S
Temporary Global Note, which shall be deposited on behalf of the purchasers
of the Notes represented thereby with the Trustee, as custodian for The
Depository Trust Company in New York, New York, and registered in the name
of the Depositary or the nominee of the Depositary for the accounts of
designated agents holding on behalf of Euroclear or Clearstream, duly
executed by the Company and authenticated by the Trustee as hereinafter
provided. The Restricted Period shall be terminated upon the receipt by the
Trustee of (i) a written certificate from Euroclear and Clearstream
certifying that they have received certification of non-United States
beneficial ownership of 100% of the aggregate principal amount of the
Regulation S Temporary Global Note (except to the extent of any Beneficial
Owners thereof who acquired an interest therein during the Restricted
Period pursuant to another exemption from registration under the Securities
Act and who shall take delivery of a beneficial ownership interest in a
144A Global Note bearing a Private Placement Legend, all as contemplated by
Section 2.06(b)(ii) hereof), and (ii) an Officers' Certificate from
24
the Company. Following the termination of the Restricted Period, beneficial
interests in the Regulation S Temporary Global Note shall be exchanged for
beneficial interests in Regulation S Permanent Global Notes pursuant to the
Applicable Procedures. Simultaneously with the authentication of Regulation
S Permanent Global Notes, the Trustee shall cancel the Regulation S
Temporary Global Note. The aggregate principal amount of the Regulation S
Temporary Global Note and the Regulation S Permanent Global Notes may from
time to time be increased or decreased by adjustments made on the records
of the Trustee and the Depositary or its nominee, as the case may be, in
connection with transfers of interest as hereinafter provided.
(d) Euroclear and Clearstream Procedures Applicable. The provisions of
the "Operating Procedures of the Euroclear System" and "Terms and
Conditions Governing Use of Euroclear" and the "General Terms and
Conditions of Clearstream Banking" and "Customer Handbook" of Clearstream
shall be applicable to transfers of beneficial interests in the Regulation
S Global Notes that are held by Participants through Euroclear or
Clearstream.
Section 2.02. Execution and Authentication. One Officer shall sign the
Notes for the Company by manual or facsimile signature.
If an Officer whose signature is on a Note no longer holds that office
at the time a Note is authenticated, the Note shall nevertheless be valid.
A Note shall not be valid until authenticated by the manual signature
of the Trustee. The signature shall be conclusive evidence that the Note has
been authenticated under this Indenture.
The aggregate principal amount of Notes which may be authenticated and
delivered under this Indenture is unlimited.
The Trustee shall, upon a written order of the Company signed by one
Officer (an "Authentication Order"), authenticate Notes for original issue up
to the aggregate principal amount authorized pursuant to this Indenture.
The Trustee may appoint an authenticating agent acceptable to the
Company to authenticate Notes. An authenticating agent may authenticate Notes
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 Holders or an
Affiliate of the Company.
Section 2.03. Registrar and Paying Agent. The Company shall maintain
an office or agency where Notes may be presented for registration of transfer
or for exchange ("Registrar") and an office or agency where Notes may be
presented for payment ("Paying Agent"). The Registrar shall keep a register
of the Notes and of their transfer and exchange. The Company may appoint one
or more co-registrars and one or more additional paying agents. The term
"Registrar" includes any co-registrar and the term "Paying Agent" includes
any additional paying agent. The Company may change any Paying Agent or
Registrar without notice to any Holder. The Company shall promptly notify the
Trustee in writing of the name and address of
25
any Agent not a party to this Indenture. If the Company fails to appoint or
maintain another entity as Registrar or Paying Agent, the Trustee shall act
as such. The Company or any of its Subsidiaries may act as Paying Agent or
Registrar.
The Company initially appoints The Depository Trust Company ("DTC") to
act as Depositary with respect to the Global Notes.
The Company initially appoints the Trustee to act as the Registrar and
Paying Agent and to act as Custodian with respect to the Global Notes.
Section 2.04. Paying Agent to Hold Money in Trust. The Company shall
require each Paying Agent other than the Trustee to agree in writing that the
Paying Agent shall hold in trust for the benefit of Holders or the Trustee all
money held by the Paying Agent for the payment of principal, premium, if any,
or Liquidated Damages, if any, or interest on the Notes, and shall notify the
Trustee of any default by the Company in making any such payment. While any
such default continues, the Trustee may require a Paying Agent to pay all money
held by it to the Trustee. The Company at any time may require a Paying Agent
to pay all money held by it to the Trustee. Upon payment over to the Trustee,
the Paying Agent (if other than the Company or a Subsidiary thereof) shall have
no further liability for the money. If the Company or a Subsidiary thereof acts
as Paying Agent, it shall segregate and hold in a separate trust fund for the
benefit of the Holders all money held by it as Paying Agent. Upon any
bankruptcy or reorganization proceedings relating to the Company, the Trustee
shall serve as Paying Agent for the Notes.
Section 2.05. Holder 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 all Holders and shall otherwise comply with TIA ss.
312(a). If the Trustee is not the Registrar, the Company shall furnish to the
Trustee at least seven Business Days before each Interest Payment Date and at
such other times as the Trustee may request in writing, a list in such form and
as of such date as the Trustee may reasonably require of the names and
addresses of the Holders of Notes and the Company shall otherwise comply with
TIA ss. 312(a).
Section 2.06. Transfer and Exchange. (a) Transfer and Exchange of
Global Notes. A Global Note may not be transferred as a whole except by the
Depositary to a nominee of the Depositary, by a nominee of the Depositary to
the Depositary or to another nominee of the Depositary, by the Depositary or
any such nominee to a successor Depositary or a nominee of such successor
Depositary. All Global Notes shall be exchanged by the Company for
Certificated Notes if (i) the Company delivers to the Trustee notice from the
Depositary that it is unwilling or unable to continue to act as Depositary or
that it is no longer a clearing agency registered under the Exchange Act and,
in either case, a successor Depositary is not appointed by the Company within
120 days after the date of such notice from the Depositary or (ii) the
Company in its sole discretion determines that the Global Notes (in whole but
not in part) should be exchanged for Certificated Notes and delivers a
written notice to such effect to the Trustee; provided that in no event shall
the Regulation S Temporary Global Note be exchanged by the Company for
Certificated Notes prior to (x) the expiration of the Restricted Period and
(y) the receipt by the Registrar of any certificates required pursuant to
Rule 903(b)(3)(ii)(B) under the Securities Act or (iii) there shall have
occurred and be continuing a Default or Event of Default
26
with respect to the Notes. Upon the occurrence of any of the preceding events
in (i), (ii) or (iii) above, Certificated Notes shall be issued in such names
as the Depositary shall instruct the Trustee. Global Notes also may be
exchanged or replaced, in whole or in part, as provided in Sections 2.07, 2.10
and 2.11 hereof. Every Note authenticated and delivered in exchange for, or in
lieu of, a Global Note or any portion thereof, pursuant to this Section 2.06 or
Section 2.07, 2.10 or 2.11 hereof, shall be authenticated and delivered in the
form of, and shall be, a Global Note. A Global Note may not be exchanged for
another Note other than as provided in this Section 2.06(a), however,
beneficial interests in a Global Note may be transferred and exchanged as
provided in Section 2.06(b), (c) or (f) hereof.
(b) Transfer and Exchange of Beneficial Interests in the Global
Notes. The transfer and exchange of beneficial interests in the Global
Notes shall be effected through the Depositary, in accordance with this
Indenture and the Applicable Procedures. Beneficial interests in the
Restricted Global Notes shall be subject to restrictions on transfer
comparable to those set forth herein to the extent required by the
Securities Act. Transfers of beneficial interests in the Global Notes
also shall require compliance with either subparagraph (i) or (ii) below,
as applicable, as well as one or more of the other following
subparagraphs, as applicable:
(i) Transfer of Beneficial Interests in the Same Global Note.
Beneficial interests in any Restricted Global Note may be transferred to
Persons who take delivery thereof in the form of a beneficial interest in
the same Restricted Global Note in accordance with the transfer
restrictions set forth in the Private Placement Legend; provided,
however, that prior to the expiration of the Restricted Period, transfers
of beneficial interests in the Regulation S Temporary Global Note may not
be made to a U.S. Person or for the account or benefit of a U.S. Person
(other than an Initial Purchaser). Beneficial interests in any
Unrestricted Global Note may be transferred to Persons who take delivery
thereof in the form of a beneficial interest in an Unrestricted Global
Note. No written orders or instructions shall be required to be delivered
to the Registrar to effect the transfers described in this Section
2.06(b)(i).
(ii) All Other Transfers and Exchanges of Beneficial Interests in
Global Notes. In connection with all transfers and exchanges of
beneficial interests that are not subject to Section 2.06(b)(i) above,
the transferor of such beneficial interest shall deliver to the Registrar
either (A) a written order from a Participant or an Indirect Participant
given to the Depositary in accordance with the Applicable Procedures
directing the Depositary to credit or cause to be credited a beneficial
interest in the Global Note in an amount equal to the beneficial interest
to be transferred or exchanged and instructions given in accordance with
the Applicable Procedures containing information regarding the
Participant account to be credited with such increase or (B) a written
order from a Participant or an Indirect Participant given to the
Depositary in accordance with the Applicable Procedures directing the
Depositary to cause to be issued a Certificated Note in an amount equal
to the beneficial interest to be transferred or exchanged and
instructions given by the Depositary to the Registrar containing
information regarding the Person in whose name such Certificated Note
shall be registered to effect the transfer or exchange referred to in (A)
above; provided that in no event shall Certificated Notes be issued upon
the transfer or exchange of beneficial interests in the Regulation S
27
Temporary Global Note prior to (x) the expiration of the Restricted
Period and (y) the receipt by the Registrar of any certificates required
pursuant to Rule 903 under the Securities Act. Upon consummation of an
Exchange Offer by the Company in accordance with Section 2.06(f) hereof,
the requirements of this Section 2.06(b)(ii) shall be deemed to have been
satisfied upon receipt by the Registrar of the instructions contained in
the Letter of Transmittal delivered by the Holder of such beneficial
interests in the Restricted Global Notes. Upon satisfaction of all of the
requirements for transfer or exchange of beneficial interests in Global
Notes contained in this Indenture and the Notes or otherwise applicable
under the Securities Act, the Trustee shall adjust the principal amount
of the relevant Global Note(s) pursuant to Section 2.06(i) hereof.
(iii) Transfer of Beneficial Interests to Another Restricted Global
Note. A beneficial interest in any Restricted Global Note may be
transferred to a Person who takes delivery thereof in the form of a
beneficial interest in another Restricted Global Note if the transfer
complies with the requirements of Section 2.06(b)(ii) above and the
Registrar receives the following:
(A) if the transferee shall take delivery in the form of a
beneficial interest in the 144A Global Note, then the transferor must
deliver a certificate in the form of Exhibit B hereto, including the
certifications in item (1) thereof; and
(B) if the transferee shall take delivery in the form of a
beneficial interest in the Regulation S Global Note, then the
transferor must deliver a certificate in the form of Exhibit B
hereto, including the certifications in item (2) thereof.
(iv) Transfer and Exchange of Beneficial Interests in a Restricted
Global Note for Beneficial Interests in the Unrestricted Global Note. A
beneficial interest in any Restricted Global Note may be exchanged by any
holder thereof for a beneficial interest in an Unrestricted Global Note
or transferred to a Person who takes delivery thereof in the form of a
beneficial interest in an Unrestricted Global Note if the exchange or
transfer complies with the requirements of Section 2.06(b)(ii) above and:
(A) such exchange or transfer is effected pursuant to the
Exchange Offer in accordance with the Registration Rights Agreement
and the holder of the beneficial interest to be transferred, in the
case of an exchange, or the transferee, in the case of a transfer,
certifies in the applicable Letter of Transmittal that it is not (1)
a Broker-Dealer, (2) a Person participating in the distribution of
the Exchange Notes or (3) a Person who is an affiliate (as defined in
Rule 144) of the Company;
(B) such transfer is effected pursuant to the Shelf
Registration Statement in accordance with the Registration Rights
Agreement;
(C) such transfer is effected by a Broker-Dealer pursuant to
the Exchange Offer Registration Statement in accordance with the
Registration Rights Agreement; or
28
(D) the Registrar receives the following:
(1) if the Holder of such beneficial interest in a
Restricted Global Note proposes to exchange such beneficial
interest for a beneficial interest in an Unrestricted Global
Note, a certificate from such Holder in the form of Exhibit C
hereto, including the certifications in item (1)(a) thereof;
or
(2) if the Holder of such beneficial interest in a
Restricted Global Note proposes to transfer such beneficial
interest to a Person who shall take delivery thereof in the
form of a beneficial interest in an Unrestricted Global Note,
a certificate from such Holder in the form of Exhibit B
hereto, including the certifications in item (4) thereof;
and, in each such case set forth in this subparagraph (D), if the
Registrar so requests or if the Applicable Procedures so require, an
Opinion of Counsel in form reasonably acceptable to the Registrar to
the effect that such exchange or transfer is in compliance with the
Securities Act and that the restrictions on transfer contained
herein and in the Private Placement Legend are no longer required in
order to maintain compliance with the Securities Act.
If any such transfer is effected pursuant to subparagraph (B) or (D)
above at a time when an Unrestricted Global Note has not yet been issued, the
Company shall issue and, upon receipt of an Authentication Order in
accordance with Section 2.02 hereof, the Trustee shall authenticate one or
more Unrestricted Global Notes in an aggregate principal amount equal to the
aggregate principal amount of beneficial interests transferred pursuant to
subparagraph (B) or (D) above.
Beneficial interests in an Unrestricted Global Note cannot be
exchanged for, or transferred to Persons who take delivery thereof in the
form of, a beneficial interest in a Restricted Global Note.
(c) Transfer or Exchange of Beneficial Interests for Certificated
Notes.
(i) Beneficial Interests in Restricted Global Notes to
Restricted Certificated Notes. If any Holder of a beneficial interest in
a Restricted Global Note proposes to exchange such beneficial interest
for a Restricted Certificated Note or to transfer such beneficial
interest to a Person who takes delivery thereof in the form of a
Restricted Certificated Note, then, upon receipt by the Registrar of the
following documentation:
(A) if the Holder of such beneficial interest in a
Restricted Global Note proposes to exchange such beneficial
interest for a Restricted Certificated Note, a certificate from
such Holder in the form of Exhibit C hereto, including the
certifications in item (2)(a) thereof;
(B) if such beneficial interest is being transferred to a
QIB in accordance with Rule 144A under the Securities Act, a
certificate to the effect set forth in Exhibit B hereto,
including the certifications in item (1) thereof;
29
(C) if such beneficial interest is being transferred to a
Non-U.S. Person in an offshore transaction in accordance with
Rule 903 or Rule 904 under the Securities Act, a certificate to
the effect set forth in Exhibit B hereto, including the
certifications in item (2) thereof;
(D) if such beneficial interest is being transferred
pursuant to an exemption from the registration requirements of
the Securities Act in accordance with Rule 144 under the
Securities Act, a certificate to the effect set forth in Exhibit
B hereto, including the certifications in item (3)(a) thereof;
(E) if such beneficial interest is being transferred to the
Company or any of its Subsidiaries, a certificate to the effect
set forth in Exhibit B hereto, including the certifications in
item (3)(b) thereof; or
(F) if such beneficial interest is being transferred
pursuant to an effective registration statement under the
Securities Act, a certificate to the effect set forth in Exhibit
B hereto, including the certifications in item (3)(c) thereof,
the Trustee shall cause the aggregate principal amount of the applicable Global
Note to be reduced accordingly pursuant to Section 2.06(i) hereof, and the
Company shall execute and the Trustee shall authenticate and deliver to the
Person designated in the instructions a Certificated Note in the appropriate
principal amount. Any Certificated Note issued in exchange for a beneficial
interest in a Restricted Global Note pursuant to this Section 2.06(c) shall be
registered in such name or names and in such authorized denomination or
denominations as the holder of such beneficial interest shall instruct the
Registrar through instructions from the Depositary and the Participant or
Indirect Participant. The Trustee shall deliver such Certificated Notes to the
Persons in whose names such Notes are so registered. Any Certificated Note
issued in exchange for a beneficial interest in a Restricted Global Note
pursuant to this Section 2.06(c)(i) shall bear the Private Placement Legend and
shall be subject to all restrictions on transfer contained therein.
(ii) Beneficial Interests in Regulation S Temporary Global Note to
Definitive Notes. Notwithstanding Sections 2.06(c)(i)(A) and (C), a
beneficial interest in the Regulation S Temporary Global Note may not be
exchanged for a Certificated Note or transferred to a Person who takes
delivery thereof in the form of a Certificated Note prior to (x) the
expiration of the Restricted Period and (y) the receipt by the Registrar of
any certificates required pursuant to Rule 903(b)(3)(ii)(B) under the
Securities Act, except in the case of a transfer pursuant to an exemption
from the registration requirements of the Securities Act other than Rule
903 or Rule 904.
(iii) Beneficial Interests in Restricted Global Notes to Unrestricted
Certificated Notes. A Holder of a beneficial interest in a Restricted
Global Note may exchange such beneficial interest for an Unrestricted
Certificated Note or may transfer such beneficial interest to a Person who
takes delivery thereof in the form of an Unrestricted Certificated Note
only if:
30
(A) such exchange or transfer is effected pursuant to the
Exchange Offer in accordance with the Registration Rights Agreement
and the Holder of such beneficial interest, in the case of an
exchange, or the transferee, in the case of a transfer, certifies in
the applicable Letter of Transmittal that it is not (1) a
Broker-Dealer, (2) a Person participating in the distribution of the
Exchange Notes or (3) a Person who is an affiliate (as defined in Rule
144) of the Company;
(B) such transfer is effected pursuant to the Shelf Registration
Statement in accordance with the Registration Rights Agreement;
(C) such transfer is effected by a Broker-Dealer pursuant to the
Exchange Offer Registration Statement in accordance with the
Registration Rights Agreement; or
(D) the Registrar receives the following:
(1) if the Holder of such beneficial interest in a
Restricted Global Note proposes to exchange such beneficial
interest for a Certificated Note that does not bear the Private
Placement Legend, a certificate from such Holder in the form of
Exhibit C hereto, including the certifications in item (1)(b)
thereof; or
(2) if the Holder of such beneficial interest in a
Restricted Global Note proposes to transfer such beneficial
interest to a Person who shall take delivery thereof in the form
of a Certificated Note that does not bear the Private Placement
Legend, a certificate from such Holder in the form of Exhibit B
hereto, including the certifications in item (4) thereof;
and, in each such case set forth in this subparagraph (D), if the
Registrar so requests or if the Applicable Procedures so require, an
Opinion of Counsel in form reasonably acceptable to the Registrar to
the effect that such exchange or transfer is in compliance with the
Securities Act and that the restrictions on transfer contained herein
and in the Private Placement Legend are no longer required in order to
maintain compliance with the Securities Act.
(iv) Beneficial Interests in Unrestricted Global Notes to
Unrestricted Certificated Notes. If any Holder of a beneficial
interest in an Unrestricted Global Note proposes to exchange such
beneficial interest for a Certificated Note or to transfer such
beneficial interest to a Person who takes delivery thereof in the form
of a Certificated Note, then, upon satisfaction of the conditions set
forth in Section 2.06(b)(ii) hereof, the Trustee shall cause the
aggregate principal amount of the applicable Global Note to be reduced
accordingly pursuant to Section 2.06(i) hereof, and the Company shall
execute and the Trustee shall authenticate and deliver to the Person
designated in the instructions a Certificated Note in the appropriate
principal amount. Any Certificated Note issued in exchange for a
beneficial interest pursuant to this Section 2.06(c)(iv) shall be
registered in such name or names and in such authorized denomination
or denominations as the Holder of such beneficial interest shall
instruct the Registrar through instructions from
31
the Depositary and the Participant or Indirect Participant. The
Trustee shall deliver such Certificated Notes to the Persons in whose
names such Notes are so registered. Any Certificated Note issued in
exchange for a beneficial interest pursuant to this Section
2.06(c)(iv) shall not bear the Private Placement Legend.
(d) Transfer and Exchange of Certificated Notes for Beneficial
Interests.
(i) Restricted Certificated Notes to Beneficial Interests in
Restricted Global Notes. If any Holder of a Restricted Certificated
Note proposes to exchange such Note for a beneficial interest in a
Restricted Global Note or to transfer such Restricted Certificated
Note to a Person who takes delivery thereof in the form of a
beneficial interest in a Restricted Global Note, then, upon receipt by
the Registrar of the following documentation:
(A) if the Holder of such Restricted Certificated Note
proposes to exchange such Note for a beneficial interest in a
Restricted Global Note, a certificate from such Holder in the
form of Exhibit C hereto, including the certifications in item
(2)(b) thereof;
(B) if such Restricted Certificated Note is being
transferred to a QIB in accordance with Rule 144A under the
Securities Act, a certificate to the effect set forth in Exhibit
B hereto, including the certifications in item (1) thereof;
(C) if such Restricted Certificated Note is being
transferred to a Non-U.S. Person in an offshore transaction in
accordance with Rule 903 or Rule 904 under the Securities Act, a
certificate to the effect set forth in Exhibit B hereto,
including the certifications in item (2) thereof;
(D) if such Restricted Certificated Note is being
transferred pursuant to an exemption from the registration
requirements of the Securities Act in accordance with Rule 144
under the Securities Act, a certificate to the effect set forth
in Exhibit B hereto, including the certifications in item (3)(a)
thereof;
(E) if such Restricted Certificated Note is being
transferred to the Company or any of its Subsidiaries, a
certificate to the effect set forth in Exhibit B hereto,
including the certifications in item (3)(b) thereof; or
(F) if such Restricted Certificated Note is being
transferred pursuant to an effective registration statement under
the Securities Act, a certificate to the effect set forth in
Exhibit B hereto, including the certifications in item (3)(c)
thereof,
the Trustee shall cancel the Restricted Certificated Note, increase or cause to
be increased the aggregate principal amount of, in the case of clause (A)
above, the appropriate Restricted Global Note, in the case of clause (B) above,
the 144A Global Note, and in the case of clause (C) above, the Regulation S
Global Note.
32
(ii) Restricted Certificated Notes to Beneficial Interests in
Unrestricted Global Notes. A Holder of a Restricted Certificated Note
may exchange such Note for a beneficial interest in an Unrestricted
Global Note or transfer such Restricted Certificated Note to a Person
who takes delivery thereof in the form of a beneficial interest in an
Unrestricted Global Note only if:
(A) such exchange or transfer is effected pursuant to the
Exchange Offer in accordance with the Registration Rights
Agreement and the Holder, in the case of an exchange, or the
transferee, in the case of a transfer, certifies in the
applicable Letter of Transmittal that it is not (1) a
Broker-Dealer, (2) a Person participating in the distribution of
the Exchange Notes or (3) a Person who is an affiliate (as
defined in Rule 144) of the Company;
(B) such transfer is effected pursuant to the Shelf
Registration Statement in accordance with the Registration Rights
Agreement;
(C) such transfer is effected by a Broker-Dealer pursuant
to the Exchange Offer Registration Statement in accordance with
the Registration Rights Agreement; or
(D) the Registrar receives the following:
(1) if the Holder of such Certificated Notes
proposes to exchange such Notes for a beneficial interest
in the Unrestricted Global Note, a certificate from such
Holder in the form of Exhibit C hereto, including the
certifications in item (1)(c) thereof; or
(2) if the Holder of such Certificated Notes
proposes to transfer such Notes to a Person who shall take
delivery thereof in the form of a beneficial interest in
the Unrestricted Global Note, a certificate from such
Holder in the form of Exhibit B hereto, including the
certifications in item (4) thereof;
and, in each such case set forth in this subparagraph (D), if the
Registrar so requests or if the Applicable Procedures so require,
an Opinion of Counsel in form reasonably acceptable to the
Registrar to the effect that such exchange or transfer is in
compliance with the Securities Act and that the restrictions on
transfer contained herein and in the Private Placement Legend are
no longer required in order to maintain compliance with the
Securities Act.
Upon satisfaction of the conditions of any of the subparagraphs in this Section
2.06(d)(ii), the Trustee shall cancel the Certificated Notes and increase or
cause to be increased the aggregate principal amount of the Unrestricted Global
Note.
(iii) Unrestricted Certificated Notes to Beneficial Interests in
Unrestricted Global Notes. A Holder of an Unrestricted Certificated Note
may exchange such Note for a beneficial interest in an Unrestricted Global
Note or transfer such Certificated Notes to a Person who takes delivery
thereof in the form of a beneficial interest in an
33
Unrestricted Global Note at any time. Upon receipt of a request for such an
exchange or transfer, the Trustee shall cancel the applicable Unrestricted
Certificated Note and increase or cause to be increased the aggregate
principal amount of one of the Unrestricted Global Notes.
If any such exchange or transfer from a Certificated Note to a
beneficial interest is effected pursuant to subparagraph (ii)(B), (ii)(D) or
(iii) above at a time when an Unrestricted Global Note has not yet been issued,
the Company shall issue and, upon receipt of an Authentication Order in
accordance with Section 2.02 hereof, the Trustee shall authenticate one or more
Unrestricted Global Notes in an aggregate principal amount equal to the
principal amount of Certificated Notes so transferred.
(e) Transfer and Exchange of Certificated Notes for Certificated
Notes. Upon request by a Holder of Certificated Notes and such Holder's
compliance with this Section 2.06(e), the Registrar shall register the
transfer or exchange of Certificated Notes. Prior to such registration of
transfer or exchange, the requesting Holder shall present or surrender to
the Registrar the Certificated Notes duly endorsed or accompanied by a
written instruction of transfer in form satisfactory to the Registrar duly
executed by such Holder or by his attorney, duly authorized in writing. In
addition, the requesting Holder shall provide any additional
certifications, documents and information, as applicable, required pursuant
to the following clauses of this Section 2.06(e).
(i) Restricted Certificated Notes to Restricted Certificated Notes.
Any Restricted Certificated Note may be transferred to and registered in
the name of Persons who take delivery thereof in the form of a Restricted
Certificated Note if the Registrar receives the following:
(A) if the transfer shall be made pursuant to Rule 144A under the
Securities Act, then the transferor must deliver a certificate in the
form of Exhibit B hereto, including the certifications in item (1)
thereof;
(B) if the transfer shall be made pursuant to Rule 903 or Rule
904, then the transferor must deliver a certificate in the form of
Exhibit B hereto, including the certifications in item (2) thereof;
and
(C) if the transfer shall be made pursuant to any other exemption
from the registration requirements of the Securities Act, then the
transferor must deliver a certificate in the form of Exhibit B hereto,
including the certifications, certificates and Opinion of Counsel
required by item (3) thereof, if applicable.
(ii) Restricted Certificated Notes to Unrestricted Certificated Notes.
Any Restricted Certificated Note may be exchanged by the Holder thereof for
an Unrestricted Certificated Note or transferred to a Person or Persons who
take delivery thereof in the form of an Unrestricted Certificated Note if:
(A) such exchange or transfer is effected pursuant to the
Exchange Offer in accordance with the Registration Rights Agreement
and the Holder, in the case of an exchange, or the transferee,
in the case of a transfer, certifies in the
34
applicable Letter of Transmittal that it is not (1) a Broker-Dealer,
(2) a Person participating in the distribution of the Exchange Notes
or (3) a Person who is an affiliate (as defined in Rule 144) of the
Company;
(B) any such transfer is effected pursuant to the Shelf
Registration Statement in accordance with the Registration Rights
Agreement;
(C) any such transfer is effected by a Broker-Dealer pursuant to
the Exchange Offer Registration Statement in accordance with the
Registration Rights Agreement; or
(D) the Registrar receives the following:
(1) if the Holder of such Restricted Certificated Notes
proposes to exchange such Notes for an Unrestricted Certificated
Note, a certificate from such Holder in the form of Exhibit C
hereto, including the certifications in item (1)(d) thereof; or
(2) if the Holder of such Restricted Certificated Notes
proposes to transfer such Notes to a Person who shall take
delivery thereof in the form of an Unrestricted Certificated
Note, a certificate from such Holder in the form of Exhibit B
hereto, including the certifications in item (4) thereof;
and, in each such case set forth in this subparagraph (D), if the
Registrar so requests, an Opinion of Counsel in form reasonably
acceptable to the Company to the effect that such exchange or transfer
is in compliance with the Securities Act and that the restrictions on
transfer contained herein and in the Private Placement Legend are no
longer required in order to maintain compliance with the Securities
Act.
(iii) Unrestricted Certificated Notes to Unrestricted Certificated
Notes. A Holder of Unrestricted Certificated Notes may transfer such Notes
to a Person who takes delivery thereof in the form of an Unrestricted
Certificated Note. Upon receipt of a request to register such a transfer,
the Registrar shall register the Unrestricted Certificated Notes pursuant
to the instructions from the Holder thereof.
(f) Exchange Offer. Upon the occurrence of the Exchange Offer in
accordance with the Registration Rights Agreement, the Company shall issue
and, upon receipt of an Authentication Order in accordance with Section
2.02, the Trustee shall authenticate (i) one or more Unrestricted Global
Notes in an aggregate principal amount equal to the principal amount of the
beneficial interests in the Restricted Global Notes tendered for acceptance
by Persons that certify in the applicable Letters of Transmittal that (x)
they are not Broker-Dealers, (y) they are not participating in a
distribution of the Exchange Notes and (z) they are not affiliates (as
defined in Rule 144) of the Company, and accepted for exchange in the
Exchange Offer and (ii) Certificated Notes in an aggregate principal amount
equal to the principal amount of the Restricted Certificated Notes accepted
for exchange in the Exchange Offer. Concurrently with the issuance of
35
such Notes, the Trustee shall cause the aggregate principal amount of
the applicable Restricted Global Notes to be reduced accordingly, and the
Company shall execute and the Trustee shall authenticate and deliver to the
Persons designated by the Holders of Certificated Notes so accepted
Certificated Notes in the appropriate principal amount. Any Notes that
remain outstanding after the consummation of the Exchange Offer, and
Exchange Notes issued in connection with the Exchange Offer, shall be
treated as a single class of securities under this Indenture.
(g) Legends. The following legends shall appear on the face of Global
Notes and Certificated Notes issued under this Indenture as specified in
this Indenture.
(i) Private Placement Legend. (A) Except as permitted by subparagraph
(B) below, each Global Note and each Certificated Note (and all Notes
issued in exchange therefor or substitution thereof) shall bear the legend
in substantially the following form:
"THIS NOTE AND THE GUARANTEES ENDORSED HEREON HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"),
OR ANY STATE OR FOREIGN SECURITIES LAWS. NEITHER THIS NOTE NOR THE
GUARANTEES ENDORSED HEREON NOR ANY INTEREST OR PARTICIPATION HEREIN
MAY BE OFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR
OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS
SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT. THE HOLDER OF THIS NOTE AND THE
GUARANTEES ENDORSED HEREON BY ITS ACCEPTANCE HEREOF AGREES TO OFFER,
SELL OR OTHERWISE TRANSFER SUCH SECURITY, PRIOR TO THE DATE WHICH IS
TWO YEARS AFTER THE LATER OF THE ORIGINAL ISSUE DATE HEREOF AND THE
LAST DATE ON WHICH THE COMPANY OR ANY AFFILIATE OF THE COMPANY WAS THE
OWNER OF THIS NOTE AND THE GUARANTEES ENDORSED HEREON (OR ANY
PREDECESSOR OF THIS NOTE AND THE GUARANTEES ENDORSED HEREON OF THIS
NOTE) (THE "RESALE RESTRICTION TERMINATION DATE") ONLY (A) TO THE
COMPANY OR ANY SUBSIDIARY THEREOF, (B) PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT, (C) FOR SO LONG AS
THE NOTES ARE ELIGIBLE FOR RESALE PURSUANT TO RULE 144A UNDER THE
SECURITIES ACT ("RULE 144A"), TO A PERSON IT REASONABLY BELIEVES IS A
"QUALIFIED INSTITUTIONAL BUYER" AS DEFINED IN RULE 144A THAT PURCHASES
FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL
BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN
RELIANCE ON RULE 144A, (D) PURSUANT TO OFFERS AND SALES TO NON-U.S.
PERSONS THAT OCCUR OUTSIDE THE UNITED STATES WITHIN THE MEANING OF
REGULATION S UNDER THE SECURITIES ACT OR
36
(E) PURSUANT TO ANOTHER AVAILABLE EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT, SUBJECT TO THE COMPANY'S AND THE
TRUSTEE'S RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER (i) PURSUANT
TO CLAUSE (D) PRIOR TO THE END OF THE 40-DAY DISTRIBUTION COMPLIANCE
PERIOD WITHIN THE MEANING OF REGULATION S UNDER THE SECURITIES ACT OR
PURSUANT TO CLAUSE (E) PRIOR TO THE RESALE RESTRICTION TERMINATION
DATE TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION
AND/OR OTHER INFORMATION SATISFACTORY TO EACH OF THEM, AND (ii) IN
EACH OF THE FOREGOING CASES, TO REQUIRE THAT A CERTIFICATE OF TRANSFER
IN THE FORM APPEARING ON THIS NOTE IS COMPLETED AND DELIVERED BY THE
TRANSFEROR TO THE TRANSFER AGENT. THIS LEGEND SHALL BE REMOVED UPON
THE REQUEST OF A HOLDER AFTER THE RESALE RESTRICTION TERMINATION
DATE."
(B) Notwithstanding the foregoing, any Global Note or Certificated
Note issued pursuant to subparagraph (b)(iv), (c)(iii), (c)(iv), (d)(ii),
(d)(iii), (e)(ii), (e)(iii) or (f) to this Section 2.06 (and all Notes
issued in exchange therefor or substitution thereof) shall not bear the
Private Placement Legend.
(ii) Global Note Legend. Each Global Note shall bear a legend in
substantially the following form:
"THIS GLOBAL NOTE IS HELD BY THE DEPOSITARY (AS DEFINED IN THE
INDENTURE GOVERNING THIS NOTE) OR ITS NOMINEE IN CUSTODY FOR THE
BENEFIT OF THE BENEFICIAL OWNERS HEREOF, AND IS NOT TRANSFERABLE TO
ANY PERSON UNDER ANY CIRCUMSTANCES EXCEPT THAT (I) THE TRUSTEE MAY
MAKE SUCH NOTATIONS HEREON AS MAY BE REQUIRED PURSUANT TO SECTION 2.06
OF THE INDENTURE, (II) THIS GLOBAL NOTE MAY BE EXCHANGED IN WHOLE BUT
NOT IN PART PURSUANT TO SECTION 2.06(a) OF THE INDENTURE, (III) THIS
GLOBAL NOTE MAY BE DELIVERED TO THE TRUSTEE FOR CANCELLATION PURSUANT
TO SECTION 2.12 OF THE INDENTURE AND (IV) THIS GLOBAL NOTE MAY BE
TRANSFERRED TO A SUCCESSOR DEPOSITARY WITH THE PRIOR WRITTEN CONSENT
OF THE COMPANY."
(h) Regulation S Temporary Global Note Legend. Each Regulation S
Temporary Global Note shall bear a legend in substantially the
following form:
"THE NOTE IS A TEMPORARY REGULATION S GLOBAL NOTE WITHIN THE MEANING
OF THE INDENTURE REFERRED TO HEREINAFTER. EXCEPT IN THE CIRCUMSTANCES
DESCRIBED IN SECTION 2.06 OF THE INDENTURE, NO TRANSFER OR EXCHANGE
OF AN INTEREST IN THIS TEMPORARY GLOBAL NOTE MAY BE MADE FOR AN
INTEREST IN THE RESTRICTED GLOBAL NOTE. NO EXCHANGE OF AN INTEREST
IN THIS TEMPORARY REGULATION S GLOBAL NOTE MAY BE MADE
37
FOR AN INTEREST IN THE PERMANENT REGULATION S GLOBAL NOTE EXCEPT (A)
ON OR AFTER THE TERMINATION OF THE DISTRIBUTION COMPLIANCE PERIOD (AS
DEFINED IN REGULATION S UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE "SECURITIES ACT")) AND (B) UPON DELIVERY OF THE OWNER SECURITIES
CERTIFICATION AND THE TRANSFEREE SECURITIES CERTIFICATION RELATING TO
SUCH INTEREST IN ACCORDANCE WITH THE TERMS OF THE INDENTURE.
UNTIL 40 DAYS AFTER THE COMMENCEMENT OF THE OFFERING OF THE NOTES, AN
OFFER OR SALE OF THE NOTES WITHIN THE UNITED STATES BY A DEALER (AS
DEFINED IN THE SECURITIES ACT OF 1933, AS AMENDED) MAY VIOLATE THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT OF 1933, AS AMENDED IF
SUCH OFFER OR SALE IS MADE OTHERWISE THAN IN ACCORDANCE WITH RULE 144A
UNDER THE SECURITIES ACT OF 1933, AS AMENDED."
(i) Cancellation and/or Adjustment of Global Notes. At such time as
all beneficial interests in a particular Global Note have been exchanged
for Certificated Notes or a particular Global Note has been redeemed,
repurchased or canceled in whole and not in part, each such Global Note
shall be returned to or retained and canceled by the Trustee in accordance
with Section 2.12 hereof. At any time prior to such cancellation, if any
beneficial interest in a Global Note is exchanged for or transferred to a
Person who shall take delivery thereof in the form of a beneficial
interest in another Global Note or for Certificated Notes, the principal
amount of Notes represented by such Global Note shall be reduced
accordingly and an endorsement shall be made on such Global Note by the
Trustee or by the Depositary at the direction of the Trustee to reflect
such reduction; and if the beneficial interest is being exchanged for or
transferred to a Person who shall take delivery thereof in the form of a
beneficial interest in another Global Note, such other Global Note shall
be increased accordingly and an endorsement shall be made on such Global
Note by the Trustee or by the Depositary at the direction of the Trustee
to reflect such increase.
(j) General Provisions Relating to Transfers and Exchanges. (i) To
permit registrations of transfers and exchanges, the Company shall execute
and the Trustee shall authenticate Global Notes and Certificated Notes
upon the Company's order or at the Registrar's request.
(ii) No service charge shall be made to a holder of a beneficial
interest in a Global Note or to a Holder of a Certificated Note 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 similar governmental charge payable upon exchange or transfer pursuant
to Sections 2.11, 3.06, 3.09, 4.10, 4.14 and 9.05 hereof).
38
(iii) The Registrar shall not be required to register the transfer of
or exchange any Note selected for redemption in whole or in part, except
the unredeemed portion of any Note being redeemed in part.
(iv) All Global Notes and Certificated Notes issued upon any
registration of transfer or exchange of Global Notes or Certificated Notes
shall be the valid and legally binding obligations of the Company,
evidencing the same debt, and entitled to the same benefits under this
Indenture, as the Global Notes or Certificated Notes surrendered upon such
registration of transfer or exchange.
(v) The Company shall not be required (A) to issue, to register the
transfer of or to exchange any Notes during a period beginning at the
opening of business 15 days before the day of any selection of Notes for
redemption under Section 3.02 hereof and ending at the close of business
on the day of selection, (B) to register the transfer of or to exchange
any Note so selected for redemption in whole or in part, except the
unredeemed portion of any Note being redeemed in part or (C) to register
the transfer of or to exchange a Note between a record date and the next
succeeding Interest Payment Date.
(vi) Prior to due presentment for the registration of a transfer of
any Note, the Trustee, any Agent and the Company may deem and treat the
Person in whose name any Note is registered as the absolute owner of such
Note for the purpose of receiving payment of principal of and interest on
such Notes and for all other purposes, and none of the Trustee, any Agent
or the Company shall be affected by notice to the contrary.
(vii) The Trustee shall authenticate Global Notes and Certificated
Notes in accordance with Section 2.02 hereof.
(viii) All certifications, certificates and Opinions of Counsel
required to be submitted to the Registrar pursuant to this Section 2.06 to
effect a registration of transfer or exchange may be submitted by
facsimile.
Section 2.07. Replacement Notes. If any mutilated Note is surrendered
to the Trustee or the Company and the Trustee receives evidence to its
satisfaction of the destruction, loss or theft of any Note, the Company shall
issue and the Trustee, upon receipt of an Authentication Order, shall
authenticate a replacement Note if the Trustee's requirements are met. If
required by the Trustee or the Company, an indemnity bond must be supplied by
the Holder that is sufficient in the judgment of the Trustee and the Company
to protect the Company, the Trustee, any Agent and any authenticating agent
from any loss that any of them may suffer if a Note is replaced. The Company
may charge for its expenses in replacing a Note.
Every replacement Note issued pursuant to this Section 2.07 is an
additional obligation of the Company and shall be entitled to all of the
benefits of this Indenture equally and proportionately with all other Notes
duly issued hereunder.
Section 2.08. Outstanding Notes. The Notes outstanding at any time
are all the Notes authenticated by the Trustee except for those canceled by
it, those delivered to it for cancellation, those reductions in the interest
in a Global Note effected by the Trustee in accordance with this Indenture,
and those described in this Section as not outstanding. Except as
39
set forth in Section 2.09 hereof, a Note does not cease to be outstanding
because the Company or an Affiliate of the Company holds the Note; however,
Notes held by the Company or a Subsidiary of the Company shall not be deemed
to be outstanding for purposes of Section 3.07(b) hereof.
If a Note is replaced pursuant to Section 2.07 hereof, it ceases to
be outstanding unless the Trustee receives proof satisfactory to it that the
replaced Note is held by a bona fide purchaser or protected purchaser.
If the principal amount of any Note is considered paid under Section
4.01 hereof, it ceases to be outstanding and interest on it ceases to accrue.
If the Paying Agent (other than the Company, a Subsidiary or an
Affiliate of any of the foregoing) holds, on a redemption date or maturity
date, money sufficient to pay Notes payable on that date in full, then on and
after that date such Notes shall be deemed to be no longer outstanding and
shall cease to accrue interest.
Section 2.09. Treasury Notes. In determining whether the Holders of
the required principal amount of the Notes have concurred in any direction,
waiver or consent, Notes owned by the Company, any direct or indirect
Subsidiary of the Company or any Affiliate of the Company shall be considered
as though not outstanding, except that for the purposes of determining whether
the Trustee shall be protected in relying on any such direction, waiver or
consent, only Notes that the Trustee knows are so owned shall be so
disregarded. Notes so owned which have been pledged in good faith shall not be
disregarded if the pledgee establishes to the satisfaction of the Trustee the
pledgee's right to deliver any such direction, waiver or consent with respect
to the Notes and that the pledgee is not the Company or any obligor upon the
Notes or any Affiliate of the Company or of such other obligor.
Section 2.10. Certificated Notes. (a) A Global Note deposited with
the Depositary or other custodian for the Depositary pursuant to Section 2.01
shall be transferred to the beneficial owners thereof in the form of
certificated Notes only if such transfer complies with Section 2.06. Notice of
any such transfer shall be given by the Company in accordance with the
provisions of Section 12.02.
(b) Any Global Note that is transferable to the beneficial owners
thereof in the form of certificated Notes pursuant to this Section 2.10
shall be surrendered by the Depositary to the Transfer Agent, to be so
transferred, in whole or from time to time in part, without charge, and
the Trustee shall authenticate and deliver, upon such transfer of each
portion of such Global Note, an equal aggregate principal amount of Notes
of authorized denominations in the form of certificated Notes.
(c) In connection with the exchange of an entire Global Note for
certificated Notes pursuant to this Section 2.10, such Global Note shall
be deemed to be surrendered to the Trustee for cancellation, and the
Company shall execute, and the Trustee shall authenticate and deliver, to
each beneficial owner identified by the Depositary in exchange for its
beneficial interest in such Global Note, an equal aggregate principal
amount of certificated Notes. In the event that such certificated Notes
are not issued to
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each beneficial owner promptly after the Registrar has received a
request from the Depositary or (through the Depositary) a beneficial owner
to issue such certificated Notes, the Company expressly acknowledges, with
respect to the right of any Holder to pursue a remedy pursuant to Article
Six hereof, the right of any beneficial owner of Notes to pursue such
remedy with respect to the portion of the Global Note that represents such
beneficial owner's Notes as if such certificated Notes had been issued.
(d) Any portion of a Global Note transferred or exchanged pursuant to
this Section 2.10 shall be executed, authenticated and delivered only in
registered form in denominations of $1,000 and any integral multiple
thereof and registered in such names as the Depositary shall direct.
Subject to the foregoing, a Global Note is not exchangeable except for a
Global Note of like denomination to be registered in the name of the
Depositary or its nominee. In the event that a Global Note becomes
exchangeable for certificated Notes, payment of principal, premium, if
any, and Liquidated Damages, if any, and interest on the certificated
Notes will be payable, and the transfer of the certificated Notes will be
registrable, at the office or agency of the Company maintained for such
purposes in accordance with Section 2.03.
(e) In the event of the occurrence of any of the events specified in
Section 2.10(a), the Company will promptly make available to the Trustee a
reasonable supply of certificated Notes in definitive, fully registered
form without interest coupons.
Section 2.11. Temporary Notes. Until certificates representing Notes
are ready for delivery, the Company may prepare and the Trustee, upon receipt
of an Authentication Order, shall authenticate temporary Notes. Temporary
Notes shall be substantially in the form of certificated Notes but may have
variations that the Company considers appropriate for temporary Notes and as
shall be reasonably acceptable to the Trustee. Without unreasonable delay, the
Company shall prepare and the Trustee shall authenticate definitive Notes in
exchange for temporary Notes.
Holders of temporary Notes shall be entitled to all of the benefits
of this Indenture.
Section 2.12. Cancellation. The Company at any time may deliver Notes
to the Trustee for cancellation. The Registrar and Paying Agent shall forward
to the Trustee any Notes surrendered to them for registration of transfer,
exchange or payment. The Trustee and no one else shall cancel all Notes
surrendered for registration of transfer, exchange, payment, replacement or
cancellation and shall dispose of such canceled Notes in its customary manner
(subject to record retention requirements of the Exchange Act). Subject to
Section 2.07, the Company may not issue new Notes to replace Notes that it has
paid or that have been delivered to the Trustee for cancellation.
Section 2.13. Defaulted Interest. If the Company defaults in a payment
of interest on the Notes, it shall pay the defaulted interest in any lawful
manner plus, to the extent lawful, interest payable on the defaulted interest,
to the Persons who are Holders on a subsequent special record date, in each case
at the rate provided in the Notes and in Section 4.01 hereof. The Company shall
notify the Trustee in writing of the amount of defaulted interest proposed to be
41
paid on each Note and the date of the proposed payment. The Company shall fix
or cause to be fixed each such special record date and payment date, provided
that no such special record date shall be less than 10 days prior to the
related payment date for such defaulted interest. At least 15 days before the
special record date, the Company (or, upon the written request of the Company,
the Trustee in the name and at the expense of the Company) shall mail or cause
to be mailed to Holders a notice that states the special record date, the
related payment date and the amount of such interest to be paid.
Section 2.14. CUSIP and ISIN Numbers. The Company in issuing the Notes
may use "CUSIP" and "ISIN" numbers (if then generally in use), and, if so, the
Trustee shall use "CUSIP" and "ISIN" numbers in notices of redemption as a
convenience to Holders; provided that any such notice may state that no
representation is made as to the correctness of such numbers either as printed
on the Notes or as contained in any notice of redemption and that reliance may
be placed only on the other identification numbers printed on the Notes, and
any such redemption shall not be affected by any defect in or omission of such
numbers. The Company shall promptly notify the Trustee of any change in the
"CUSIP" or "ISIN" numbers.
Section 2.15. Deposit of Moneys. By or before 12:00 p.m. (noon)
Eastern Time on each due date of the principal, premium, if any, and Liquidated
Damages, if any, and interest on any Notes, the Company shall deposit with the
Paying Agent money in immediately available funds sufficient to pay such
principal, premium, if any, and Liquidated Damages, if any, and interest so
becoming due on the due date for payment under the Notes and (unless the Paying
Agent is the Trustee) the Company will promptly notify the Trustee of its
action or failure so to act.
Section 2.16. Computation of Interest. Interest on the Notes shall be
computed on the basis of a 360-day year of twelve 30-day months.
ARTICLE 3
REDEMPTION AND PREPAYMENT
Section 3.01. Notices to Trustee. If the Company elects to redeem
Notes pursuant to Section 3.07 hereof, it shall furnish to the Trustee, at
least 30 days but not more than 60 days before a redemption date (unless a
shorter notice period shall be satisfactory to the Trustee in its reasonable
discretion), an Officers' Certificate setting forth (a) the clause of this
Indenture pursuant to which the redemption shall occur, (b) the redemption
date, (c) the principal amount of Notes to be redeemed and (d) the redemption
price.
Section 3.02. Selection of Notes to Be Redeemed. If less than all of
the Notes are to be redeemed at any time, selection of Notes for redemption
shall be made by the Trustee in compliance with the requirements of the
principal national securities exchange, if any, on which the Notes are listed,
or, if the Notes are not so listed, on a pro rata basis, by lot or by such
method as the Trustee shall deem fair and appropriate. In the event of partial
redemption by lot, the particular Notes to be redeemed shall be selected,
unless otherwise provided herein, not less than 30 nor more than 60 days prior
to the redemption date by the Trustee (unless a shorter time
42
period shall be satisfactory to the Trustee) from the outstanding Notes not
previously called for redemption.
The Trustee shall promptly notify the Company in writing of the Notes
selected for redemption and, in the case of any Note selected for partial
redemption, the principal amount thereof to be redeemed. Notes and portions of
Notes selected shall be in amounts of $1,000 or whole multiples of $1,000;
except that if all of the Notes of a Holder are to be redeemed, the entire
outstanding amount of Notes held by such Holder, even if not a multiple of
$1,000, shall be redeemed. Except as provided in the preceding sentence, the
provisions of this Indenture that apply to Notes called for redemption also
apply to portions of Notes called for redemption.
Section 3.03. Notice of Redemption. Subject to Section 3.09 hereof, at
least 30 days but not more than 60 days before a redemption date, the Company
shall mail or cause to be mailed, by first class mail, a notice of redemption
to each Holder whose Notes are to be redeemed at its registered address.
The notice shall identify the Notes to be redeemed and shall state:
(a) the redemption date;
(b) the redemption price;
(c) if any Note is being redeemed in part, the portion of the
principal amount of such Note to be redeemed and that, after the
redemption date upon surrender of such Note, a new Note or Notes in
principal amount equal to the unredeemed portion of the original Note
shall be issued in the name of the Holder thereof upon cancellation of the
original Note;
(d) the name and address of the Paying Agent;
(e) that Notes called for redemption must be surrendered to the
Paying Agent to collect the redemption price and become due on the date
fixed for redemption;
(f) that, unless the Company defaults in making such redemption
payment, interest on Notes called for redemption ceases to accrue on and
after the redemption date;
(g) the paragraph of the Notes and/or Section of this Indenture
pursuant to which the Notes called for redemption are being redeemed; and
(h) that no representation is made as to the correctness or accuracy
of the CUSIP number, if any, listed in such notice or printed on the
Notes.
At the Company's request, the Trustee shall give the notice of
redemption in the Company's name and at its expense; provided, however, that
the Company shall have delivered to the Trustee, at least 45 days prior to the
redemption date, an Officers' Certificate requesting that the Trustee give
such notice and setting forth the information to be stated in such notice as
provided in the preceding paragraph. The notice, if mailed in the manner
provided herein shall be presumed to have been given, whether or not the
Holder receives such notice.
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Section 3.04. Effect of Notice of Redemption. Once notice of
redemption is mailed in accordance with Section 3.03 hereof, Notes called for
redemption become irrevocably due and payable on the redemption date at the
redemption price. A notice of redemption may not be conditional.
Section 3.05. Deposit of Redemption Price. Not later than one
Business Day prior to the redemption date, the Company shall deposit with the
Trustee or with the Paying Agent money sufficient to pay the redemption price
of and accrued and unpaid interest and Liquidated Damages, if any, on all
Notes to be redeemed on that date. The Trustee or the Paying Agent shall
promptly return to the Company any money deposited with the Trustee or the
Paying Agent by the Company in excess of the amounts necessary to pay the
redemption price of, and accrued and unpaid interest on, all Notes to be
redeemed.
If the Company complies with the preceding paragraph of this Section
3.05, on and after the redemption date, interest shall cease to accrue on the
Notes or the portions of Notes called for redemption. If a Note is redeemed on
or after a record date but on or prior to the related Interest Payment Date,
then any accrued and unpaid interest shall be paid to the Person in whose name
such Note was registered at the close of business on such record date. If any
Note called for redemption shall not be so paid upon surrender for redemption
because of the failure of the Company to comply with the preceding paragraph,
interest shall accrue on the unpaid principal, from the redemption date until
such principal is paid, and to the extent permitted by applicable law on any
interest accrued through the date of redemption but not paid on such unpaid
principal, in each case at the rate provided in the Notes and in Section 4.01
hereof.
Section 3.06. Notes Redeemed in Part. Upon surrender of a Note that
is redeemed in part, the Company shall issue and, upon the Company's written
request, the Trustee shall authenticate for the Holder at the expense of the
Company a new Note equal in principal amount to the unredeemed portion of the
Note surrendered.
Section 3.07. Optional Redemption. (a) Except as set forth in clause
(b) of this Section 3.07, the Notes shall not be redeemable at the Company's
option prior to February 1, 2010. Thereafter, the Company may redeem all or a
part of the Notes, from time to time, upon not less than 30 nor more than 60
days' notice, at the redemption prices (expressed as percentages of principal
amount) set forth below plus accrued and unpaid interest and Liquidated
Damages, if any, to the applicable redemption date, if redeemed during the
twelve-month period beginning on February 1 of the years indicated below:
Year Percentage
---- ----------
2010........................................ 103.688%
2011........................................ 102.458%
2012........................................ 101.229%
2013 and thereafter......................... 100.000%
(b) At any time prior to February 1, 2008, the Company may at its
option on any one or more occasions redeem up to 35% of the aggregate
principal amount of Notes at a redemption price of 107.375% of the
principal amount thereof, plus accrued and unpaid interest and Liquidated
Damages, if any, thereon to the redemption date, with the
44
net cash proceeds of one or more Equity Offerings; provided that (i) at
least 65% of the aggregate principal amount of Notes remains outstanding
immediately after the occurrence of such redemption (excluding Notes held
by the Company or its Subsidiaries); and (ii) the redemption must occur
within 45 days of the date of the closing of such Equity Offering.
(c) Any redemption pursuant to this Section 3.07 shall be made
pursuant to Section 3.01 through 3.06 hereof.
Section 3.08. Mandatory Redemption. The Company is not required to
make mandatory redemption or sinking fund payments with respect to the Notes.
Section 3.09. Offer to Purchase. In the event that, pursuant to
Sections 4.10 and 4.14 hereof, the Company shall be required to commence an
offer to all Holders to purchase Notes (a "Repurchase Offer"), it shall follow
the procedures specified below.
The Repurchase Offer shall remain open for a period of 20 Business
Days following its commencement and no longer, except to the extent that a
longer period is required by applicable law (the "Offer Period"). No later
than five Business Days after the termination of the Offer Period (the
"Purchase Date"), the Company shall purchase the principal amount of Notes
required to be purchased pursuant to Section 4.10 or 4.14 hereof (the "Offer
Amount") or, if less than the Offer Amount has been tendered, all Notes
tendered in response to the Repurchase Offer. Payment for any Notes so
purchased shall be made in the same manner as interest payments are made.
If the Purchase Date is on or after an interest Record Date and on or
before the related Interest Payment Date, any accrued and unpaid interest
shall be paid to the Person in whose name a Note is registered at the close of
business on such Record Date, and no additional interest shall be payable to
Holders who tender Notes pursuant to the Repurchase Offer.
Upon the commencement of a Repurchase Offer, the Company shall send,
by first class mail, a notice to the Trustee and each of the Holders, with a
copy to the Trustee. The notice shall contain all instructions and materials
necessary to enable such Holders to tender Notes pursuant to the Repurchase
Offer. The Repurchase Offer shall be made to all Holders. The notice, which
shall govern the terms of the Repurchase Offer, shall state:
(a) that the Repurchase Offer is being made pursuant to this Section
3.09 and Section 4.10 or 4.14 hereof and the length of time the Repurchase
Offer shall remain open;
(b) the Offer Amount, the purchase price and the Purchase Date;
(c) that any Note not tendered or accepted for payment shall continue
to accrue interest and Liquidated Damages, if any;
(d) that, unless the Company defaults in making such payment, any
Note accepted for payment pursuant to the Repurchase Offer shall cease to
accrue interest and Liquidated Damages, if any, after the Purchase Date;
45
(e) that Holders electing to have a Note purchased pursuant to a
Repurchase Offer may only elect to have all of such Note purchased or a
portion of such Note in denominations of $1,000 or integral multiples
thereof;
(f) that Holders electing to have a Note purchased pursuant to any
Repurchase Offer shall be required to surrender the Note, with the form
entitled "Option of Holder to Elect Purchase" on the reverse of the Note
completed, or transfer by book-entry transfer, to the Company, the
Depositary, if appointed by the Company, or a Paying Agent at the address
specified in the notice at least three days before the Purchase Date;
(g) that Holders shall be entitled to withdraw their election if the
Company, the Depositary or the Paying Agent, as the case may be, receives,
not later than the expiration of the Offer Period, a telegram, telex,
facsimile transmission or letter setting forth the name of the Holder, the
principal amount of the Note the Holder delivered for purchase and a
statement that such Holder is withdrawing his election to have such Note
purchased;
(h) that, if the aggregate principal amount of Notes surrendered by
Holders exceeds the Offer Amount required pursuant to Section 4.10, the
Company shall select the Notes to be purchased pursuant to the terms of
Section 3.02 (with such adjustments as may be deemed appropriate by the
Trustee so that only Notes in denominations of $1,000, or integral
multiples thereof, shall be purchased); and
(i) that Holders whose Notes were purchased only in part shall be
issued new Notes equal in principal amount to the unpurchased portion of
the Notes surrendered (or transferred by book-entry transfer).
On or before the Purchase Date, the Company shall, to the extent
lawful, accept for payment, on a pro rata basis to the extent necessary, the
Offer Amount of Notes or portions thereof tendered pursuant to the Repurchase
Offer, or if less than the Offer Amount has been tendered, all Notes tendered,
and shall deliver to the Trustee an Officers' Certificate stating that such
Notes or portions thereof were accepted for payment by the Company in
accordance with the terms of this Section 3.09. The Company, the Depositary or
the Paying Agent, as the case may be, shall promptly (but in any case not
later than five days after the Purchase Date) mail or deliver to each
tendering Holder an amount equal to the purchase price of the Notes tendered
by such Holder and accepted by the Company for purchase, and the Company shall
promptly issue a new Note, and the Trustee, upon written request from the
Company shall authenticate and mail or deliver such new Note to such Holder,
in a principal amount equal to any unpurchased portion of the Note
surrendered. Any Note not so accepted shall be promptly mailed or delivered by
the Company to the Holder thereof. The Company shall publicly announce the
results of the Repurchase Offer on the Purchase Date.
Other than as specifically provided in this Section 3.09, any
purchase pursuant to this Section 3.09 shall be made pursuant to Sections 3.01
through 3.06 hereof.
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ARTICLE 4
COVENANTS
Section 4.01. Payment of Notes. The Company shall pay or cause to be
paid the principal of, premium, if any, and Liquidated Damages, if any, and
interest on the Notes on the dates and in the manner provided in the Notes and
in this Indenture. Principal, premium, if any, and Liquidated Damages, if any,
and interest shall be considered paid on the date due if the Paying Agent, if
a Person other than the Company, a Subsidiary or affiliate thereof, holds as
of 12:00 p.m. (noon) Eastern Time on the due date money deposited by the
Company in immediately available funds and designated for and sufficient to
pay all principal, premium, if any, and Liquidated Damages, if any, and
accrued and unpaid interest then due.
The Company shall pay interest (including post-petition interest in
any proceeding under any Bankruptcy Law) on overdue principal at the rate
equal to 1% per annum in excess of the then applicable interest rate on the
Notes to the extent lawful; it shall pay interest (including post-petition
interest in any proceeding under any Bankruptcy Law) on overdue installments
of interest and Liquidated Damages (without regard to any applicable grace
period) at the same rate to the extent lawful.
Section 4.02. Maintenance of Office or Agency. The Company shall
maintain in the Borough of Manhattan, the City of New York, an office or
agency (which may be an office of the Trustee or an affiliate of the Trustee,
Registrar or co-registrar) where Notes may be surrendered for registration of
transfer or for exchange and where notices and demands to or upon the Company
in respect of the Notes and this Indenture may be served. 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 Corporate Trust Office of the Trustee.
The Company may also from time to time designate one or more other
offices or agencies where the Notes may be presented or surrendered for any or
all such purposes and may from time to time rescind such designations;
provided, however, that no such designation or rescission shall in any manner
relieve the Company of its obligation to maintain an office or agency in the
Borough of Manhattan, the City of New York for such purposes. The Company
shall give prompt written notice to the Trustee of any such designation or
rescission and of any change in the location of any such other office or
agency.
The Company hereby designates the Corporate Trust Office of the
Trustee as one such office or agency of the Company in accordance with Section
2.03.
Section 4.03. Reports. (a) Whether or not required by the SEC, so
long as any Notes are outstanding, the Company shall prepare and furnish to
the Holders of Notes, within the time periods specified in the SEC's rules and
regulations, (i) all quarterly and annual financial information that would be
required to be contained in a filing with the SEC on Forms 10-Q and 10-K if
the Company were required to file such Forms, including a "Management's
Discussion
47
and Analysis of Financial Condition and Results of Operations" and, with
respect to the annual information only, a report on the annual financial
statements by the Company's certified independent accountants; and (ii) all
current reports that would be required to be filed with the SEC on Form 8-K if
the Company were required to file such reports. In addition, whether or not
required by the SEC, the Company shall file a copy of all of the information
and reports referred to in clauses (i) and (ii) above with the SEC for public
availability within the time periods specified in the SEC's rules and
regulations (unless the SEC shall not accept such a filing) and make such
information available to securities analysts and prospective investors upon
request. In addition, the Company and the Guarantors have agreed that, for so
long as any Notes remain outstanding, they shall furnish to the Holders and to
prospective investors, upon their request, the information required to be
delivered pursuant to Rule 144A(d)(4) under the Securities Act.
(b) If the Company has designated any of its Subsidiaries as
Unrestricted Subsidiaries, then the quarterly and annual financial
information required by paragraph (a) above shall include a reasonably
detailed presentation, either on the face of the financial statements or
in the footnotes thereto, and in "Management's Discussion and Analysis of
Financial Condition and Results of Operations," of the financial condition
and results of operations of the Company and its Restricted Subsidiaries
separate from the financial condition and results of operations of the
Unrestricted Subsidiaries of the Company.
Section 4.04. Compliance Certificate. (a) The Company and each
Guarantor (to the extent that such Guarantor is so required under the TIA)
shall deliver to the Trustee, within 90 days after the end of each fiscal
year, an Officers' Certificate stating that, to his or her knowledge the
Company has kept, observed, performed and fulfilled its obligations under this
Indenture and is not in default in the performance or observance of any of the
terms, provisions and conditions of this Indenture (or, if a Default or Event
of Default shall have occurred, describing all such Defaults or Events of
Default of which he or she may have knowledge and what action the Company is
taking or proposes to take with respect thereto) and that to his or her
knowledge no event has occurred and is continuing by reason of which payments
on account of the principal of or interest, if any, on the Notes is prohibited
or if such event has occurred, a description of the event and what action the
Company is taking or proposes to take with respect thereto.
(b) So long as not contrary to the then current recommendations of
the American Institute of Certified Public Accountants, the year-end
financial statements delivered pursuant to Section 4.03(a) above shall be
accompanied by a written statement of the Company's independent public
accountants (who shall be a firm of established national reputation) that
in making the examination necessary for certification of such financial
statements, nothing has come to their attention that would lead them to
believe that the Company has violated Article 4 or Article 5 hereof 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, so long as any of the Notes are outstanding,
deliver to the Trustee, forthwith, but in no event later than five
Business Days, upon any Officer
48
becoming aware of any Default or Event of Default, an Officers'
Certificate specifying such Default or Event of Default and what action
the Company is taking or proposes to take with respect thereto.
Section 4.05. Taxes. The Company shall pay, and shall cause each of
its Subsidiaries to pay, prior to delinquency, all material taxes,
assessments, and governmental levies except such as are contested in good
faith and by appropriate proceedings or where the failure to effect such
payment is not adverse in any material respect to the Holders of the Notes.
Section 4.06. Stay, Extension and Usury Laws. Each of the Company and
the Guarantors covenants (to the extent that it is permitted by applicable
law) 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, extension or
usury law wherever enacted, now or at any time hereafter in force, that may
affect the obligations of the Company and each of the Guarantors and the
performance of this Indenture by the Company and each of the Guarantors; and
each of the Company and the Guarantors (to the extent that it is permitted by
applicable law) hereby expressly waives all benefit or advantage of any such
law, and covenants that it shall not, by resort to any such law, hinder, delay
or impede the execution of any power herein granted to the Trustee, but shall
suffer and permit the execution of every such power as though no such law has
been enacted.
Section 4.07. Restricted Payments. (a) The Company shall not, and
shall not permit any of its Restricted Subsidiaries to, directly or
indirectly:
(i) declare or pay any dividend or make any other payment or
distribution on account of the Company's or any of its Restricted
Subsidiaries' Equity Interests (including, without limitation, any payment
in connection with any merger or consolidation involving the Company or
any of its Restricted Subsidiaries) or to the direct or indirect holders
of the Company's or any of its Restricted Subsidiaries' Equity Interests
in their capacity as such (other than dividends, payments or distributions
payable in Equity Interests (other than Disqualified Stock) of the Company
or to the Company or a Restricted Subsidiary of the Company);
(ii) purchase, redeem or otherwise acquire or retire for value
(including, without limitation, in connection with any merger or
consolidation involving the Company) any Equity Interests of the Company
or any Restricted Subsidiary of the Company held by Persons other than the
Company or any of its Restricted Subsidiaries, other than the purchase,
redemption or acquisition or retirement for value of any of (x) all of the
Equity Interests in VARTA not held by the Company or any of its Restricted
Subsidiaries pursuant to, and in accordance with the terms of, the VARTA
Joint Venture Agreement as in effect on the Issue Date to the extent the
cash purchase price does not exceed (euro)5.0 million; (y) all of the
Equity Interests of Ningbo Baowang not held by the Company or any of its
Restricted Subsidiaries to the extent the cash purchase price does not
exceed $5.0 million; and (z) all of the Equity Interests of Microlite not
held by the Company or any of its Restricted Subsidiaries pursuant to, and
in accordance with the terms of, the Microlite Purchase Agreement as in
effect on the date of the Indenture to the extent the cash purchase price
does not exceed $10.0 million;
49
(iii) make any payment on or with respect to, or purchase, redeem,
defease or otherwise acquire or retire for value any Indebtedness that is
subordinated to the Notes or the Note Guarantees, except a payment of
interest or principal on or after the Stated Maturity thereof or on
Indebtedness permitted to be incurred pursuant to Section 4.09(b)(vi); or
(iv) make any Restricted Investment (all such payments and other
actions set forth in clauses (i) through (iv) above being collectively
referred to as "Restricted Payments"),
unless, at the time of and after giving effect to such Restricted Payment:
(A) no Default or Event of Default shall have occurred and be
continuing or would occur as a consequence thereof; and
(B) the Company would, at the time of such Restricted Payment and
after giving pro forma effect thereto as if such Restricted Payment had
been made at the beginning of the applicable four-quarter period, have
been permitted to incur at least $1.00 of additional Indebtedness pursuant
to the Fixed Charge Coverage Ratio test set forth in Section 4.09; and
(C) such Restricted Payment, together with the aggregate amount of
all other Restricted Payments made by the Company and its Restricted
Subsidiaries after the Issue Date (excluding Restricted Payments permitted
by clauses (ii), (iii) (iv) (to the extent such dividends are paid to the
Company or any of its Restricted Subsidiaries) and (v) of Section
4.07(b)), is less than the sum, without duplication, of:
(1) 50% of the Consolidated Net Income of the Company for the
period (taken as one accounting period) from the beginning of the
first fiscal quarter commencing after the Issue Date to the end of
the Company's most recently ended fiscal quarter for which internal
financial statements are available at the time of such Restricted
Payment (or, if such Consolidated Net Income for such period is a
deficit, less 100% of such deficit); plus
(2) 100% of the aggregate net cash proceeds received by the
Company since the Issue Date as a contribution to its common equity
capital or from the issue or sale of Equity Interests of the Company
(other than Disqualified Stock) or from the issue or sale of
convertible or exchangeable Disqualified Stock or convertible or
exchangeable debt securities of the Company that have been converted
into or exchanged for such Equity Interests (other than Equity
Interests (or Disqualified Stock or debt securities) sold to a
Subsidiary of the Company); plus
(3) with respect to Restricted Investments made by the Company
and its Restricted Subsidiaries after the Issue Date, an amount equal
to the net reduction in Investments (other than reductions in
Permitted Investments) in any Person resulting from repayments of
loans or advances, or other transfers of assets, in each case to the
Company or any Restricted Subsidiary or from the net
50
cash proceeds from the sale of any such Investment (except, in each
case, to the extent any such payment or proceeds are included in the
calculation of Consolidated Net Income, from the release of any
Guarantee (except to the extent any amounts are paid under such
Guarantee) or from redesignations of Unrestricted Subsidiaries as
Restricted Subsidiaries, not to exceed, in each case, the amount of
Investments previously made by the Company or any Restricted
Subsidiary in such Person or Unrestricted Subsidiary; plus
(4) $50.0 million.
(b) So long as no Default has occurred and is continuing or would be
caused thereby, the preceding clauses of this Section 4.07 shall not
prohibit:
(i) the payment of any dividend within 60 days after the date of
declaration thereof, if at said date of declaration such payment would
have complied with this Indenture;
(ii) the redemption, repurchase, retirement, defeasance or other
acquisition of any subordinated Indebtedness of the Company or any
Guarantor or of any Equity Interests of the Company or any Guarantor in
exchange for, or out of the net cash proceeds of a contribution to the
common equity of the Company or a substantially concurrent sale (other
than to a Subsidiary of the Company) of, Equity Interests of the Company
(other than Disqualified Stock); provided that the amount of any such net
cash proceeds that are utilized for any such redemption, repurchase,
retirement, defeasance or other acquisition shall be excluded from clause
(C)(2) of Section 4.07(a);
(iii) the defeasance, redemption, repurchase or other acquisition of
subordinated Indebtedness of the Company or any Guarantor with the net
cash proceeds from an incurrence of Permitted Refinancing Indebtedness;
(iv) the payment of any dividend by a Restricted Subsidiary of the
Company to the holders of its common Equity Interests on a pro rata basis;
(v) Investments acquired as a capital contribution to, or in exchange
for, or out of the net cash proceeds of a substantially concurrent
offering of, Equity Interests (other than Disqualified Stock) of the
Company; provided that the amount of any such net cash proceeds that are
utilized for any such acquisition or exchange shall be excluded from
clause (C)(2) of Section 4.07(a);
(vi) the repurchase of Capital Stock deemed to occur upon the
exercise of options or warrants if such Capital Stock represents all or a
portion of the exercise price thereof;
(vii) the repurchase, redemption or other acquisition or retirement
for value of any Equity Interests of the Company held by any employee,
former employee, director or former director of the Company (or any of its
Restricted Subsidiaries) upon the death, disability or termination of
employment of any of the foregoing pursuant to the terms of any employee
equity subscription agreement, stock option agreement or similar
51
agreement; provided that the aggregate price paid for all such
repurchased, redeemed, acquired or retired Equity Interests in any fiscal
year shall not exceed the sum of (x) $5.0 million and (y) the amount of
Restricted Payments permitted but not made pursuant to this clause (vii)
in the immediately preceding fiscal year; or
(viii) the repurchase, redemption or other acquisition or retirement
for value of any Equity Interests of any Restricted Subsidiary of the
Company from the minority stockholders (or other holders of minority
interest, however designated) of such Restricted Subsidiary for fair
market value; provided that the aggregate price paid for all such
repurchased, redeemed, acquired or retired Equity Interests shall not
exceed $20.0 million.
The amount of all Restricted Payments (other than cash) shall be the
fair market value on the date of the Restricted Payment of the asset(s) or
securities proposed to be transferred or issued to or by the Company or such
Subsidiary, as the case may be, pursuant to the Restricted Payment. The fair
market value of any assets or securities that are required to be valued
pursuant to this Section 4.07 shall be determined by the Board of Directors of
the Company whose resolution with respect thereto shall be delivered to the
Trustee. Not later than the date of making any Restricted Payment, the Company
shall deliver to the Trustee an Officers' Certificate stating that such
Restricted Payment is permitted and setting forth the basis upon which the
calculations required by this Section 4.07 were computed, together with a copy
of any fairness opinion or appraisal required by this Indenture.
Section 4.08. Dividend and Other Payment Restrictions Affecting
Restricted Subsidiaries. The Company shall not, and shall not permit any of
its Restricted Subsidiaries to, directly or indirectly, create or permit to
exist or become effective any consensual encumbrance or restriction on the
ability of any Restricted Subsidiary to:
(a) pay dividends or make any other distributions on its Capital
Stock (or with respect to any other interest or participation in, or
measured by, its profits) to the Company or any of its Restricted
Subsidiaries or pay any liabilities owed to the Company or any of its
Restricted Subsidiaries;
(b) make loans or advances to the Company or any of its Restricted
Subsidiaries; or
(c) transfer any of its properties or assets to the Company or any of
its Restricted Subsidiaries.
However, the preceding restrictions shall not apply to encumbrances
or restrictions existing under, by reason of, or with respect to:
(i) the Credit Agreement, Existing Indebtedness or any other
agreements in effect on the Issue Date and any amendments, modifications,
restatements, renewals, extensions, supplements, refundings, replacements
or refinancings thereof, provided that the encumbrances and restrictions
in any such amendments, modifications, restatements, renewals, extensions,
supplements, refundings, replacement or refinancings are no more
restrictive, taken as a whole, than those in effect on the Issue Date;
52
(ii) applicable law, rule, regulation or order;
(iii) any Person or the property or assets of a Person acquired by
the Company or any of its Restricted Subsidiaries existing at the time of
such acquisition and not incurred in connection with or in contemplation
of such acquisition, which encumbrance or restriction is not applicable to
any Person or the properties or assets of any Person, other than the
Person, or the property or assets of such Person, so acquired and any
amendments, modifications, restatements, renewals, extensions,
supplements, refundings, replacements or refinancings thereof, provided
that the encumbrances and restrictions in any such amendments,
modifications, restatements, renewals, extensions, supplements,
refundings, replacement or refinancings are no more restrictive, taken as
a whole, than those contained in the Credit Agreement, Existing
Indebtedness or such other agreements as in effect on the date of the
acquisition;
(iv) in the case of clause (c) of the first paragraph of this Section
4.08:
(A) provisions that restrict in a customary manner the
subletting, assignment or transfer of any property or asset that is a
lease, license, conveyance or contract or similar property or asset,
(B) restrictions existing by virtue of any transfer of,
agreement to transfer, option or right with respect to, or Lien on,
any property or assets of the Company or any Restricted Subsidiary
not otherwise prohibited by this Indenture, or
(C) restrictions arising or agreed to in the ordinary course of
business, not relating to any Indebtedness, and that do not,
individually or in the aggregate, detract from the value of property
or assets of the Company or any Restricted Subsidiary in any manner
material to the Company or any Restricted Subsidiary;
(v) provisions with respect to the disposition or distribution of
assets or property in joint venture agreements and other similar
agreements entered into in the ordinary course of business;
(vi) any agreement for the sale or other disposition of all or
substantially all of the capital stock of, or property and assets of, a
Restricted Subsidiary that restricted distributions by that Restricted
Subsidiary pending such sale or other disposition; and
(vii) Indebtedness of a Foreign Subsidiary permitted to be incurred
under this Indenture; provided that (A) such encumbrances or restrictions
are ordinary and customary with respect to the type of Indebtedness being
incurred; and (B) such encumbrances or restrictions will not affect the
Company's ability to make principal and interest payments on the Notes, as
determined in good faith by the Board of Directors of the Company.
Section 4.09. Incurrence of Indebtedness and Issuance of Preferred
Stock. (a) The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, directly or indirectly, incur any Indebtedness (including
Acquired Debt), and the Company shall not permit
53
any of its Restricted Subsidiaries to issue any preferred stock; provided,
however, that the Company or any Restricted Subsidiary of the Company may
incur Indebtedness, if the Fixed Charge Coverage Ratio for the Company's most
recently ended four full fiscal quarters for which internal financial
statements are available immediately preceding the date on which such
additional Indebtedness is incurred would have been at least 2.0 to 1,
determined on a pro forma basis (including a pro forma application of the net
proceeds therefrom), as if the additional Indebtedness had been incurred at
the beginning of such four-quarter period.
(b) So long as no Default shall have occurred and be continuing or
would be caused thereby, Section 4.09(a) shall not prohibit the incurrence
of any of the following items of Indebtedness (collectively, "Permitted
Debt"):
(i) the incurrence by the Company or any Restricted Subsidiary of the
Company of Indebtedness under Credit Facilities (and the incurrence of
Guarantees thereof) in an aggregate principal amount at any one time
outstanding pursuant to this clause (i) (with letters of credit being
deemed to have a principal amount equal to the maximum potential liability
of the Company and its Restricted Subsidiaries thereunder) not to exceed
$1.6 billion, less the aggregate amount of all Net Proceeds of Asset Sales
applied by the Company or any Restricted Subsidiary to permanently repay
any such Indebtedness (and, in the case of any revolving credit
Indebtedness, to effect a corresponding commitment reduction thereunder)
pursuant to Section 4.10;
(ii) the incurrence of Existing Indebtedness;
(iii) the incurrence by the Company and the Guarantors of
Indebtedness represented by the Notes and the related Note Guarantees to
be issued on the Issue Date and the Exchange Notes and the related Note
Guarantees to be issued pursuant to the Registration Rights Agreement;
(iv) the incurrence by the Company or any Restricted Subsidiary of
the Company of Indebtedness represented by Capital Lease Obligations,
mortgage financings or purchase money obligations, in each case, incurred
for the purpose of financing all or any part of the purchase price or cost
of construction or improvement of property, plant or equipment used in the
business of the Company or such Restricted Subsidiary, in an aggregate
principal amount, including all Permitted Refinancing Indebtedness
incurred to refund, refinance or replace any Indebtedness incurred
pursuant to this clause (iv), not to exceed, at any time outstanding, the
greater of (a) $50.0 million and (b) 10% of Consolidated Net Tangible
Assets of the Company;
(v) the incurrence by the Company or any Restricted Subsidiary of the
Company of Permitted Refinancing Indebtedness in exchange for, or the net
proceeds of which are used to refund, refinance or replace Indebtedness
(other than intercompany Indebtedness) that was permitted by this
Indenture to be incurred under Section 4.09(a) or clauses (ii) (other than
the 9 7/8% Senior Subordinated Notes due 2009 of United incurred in
connection with its acquisition by the Company), (iii), (iv), (v), or
(viii) of this Section 4.09(b);
54
(vi) the incurrence by the Company or any of its Restricted
Subsidiaries of intercompany Indebtedness owing to and held by the Company
or any of its Restricted Subsidiaries; provided, however, that:
(x) if the Company or any Guarantor is the obligor on such
Indebtedness, such Indebtedness must be unsecured and expressly
subordinated to the prior payment in full in cash of all Obligations
with respect to the Notes, in the case of the Company, or the Note
Guarantee, in the case of a Guarantor;
(y) Indebtedness owed to the Company or any Guarantor must be
evidenced by an unsubordinated promissory note, unless the obligor
under such Indebtedness is the Company or a Guarantor; and
(z) (A) any subsequent issuance or transfer of Equity Interests
that results in any such Indebtedness being held by a Person other
than the Company or a Restricted Subsidiary thereof and (B) any sale
or other transfer of any such Indebtedness to a Person that is not
either the Company or a Restricted Subsidiary thereof, shall be
deemed, in each case, to constitute an incurrence of such
Indebtedness by the Company or such Restricted Subsidiary, as the
case may be, that was not permitted by this clause (vi);
(vii) the Guarantee by the Company or any Restricted Subsidiary of
the Company of Indebtedness of the Company or a Restricted Subsidiary of
the Company that was permitted to be incurred by another provision of this
Section 4.09;
(viii) the incurrence by the Company or any Restricted Subsidiary of
the Company of additional Indebtedness in an aggregate principal amount
(or accreted value, as applicable) at any time outstanding, including all
Permitted Refinancing Indebtedness incurred to refund, refinance or
replace any Indebtedness incurred pursuant to this clause (8), not to
exceed $50.0 million; and
(ix) the incurrence of Indebtedness by the Company or any Restricted
Subsidiary of the Company 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 that such
Indebtedness is extinguished within five Business Days of incurrence.
(c) For purposes of determining compliance with this Section 4.09, in
the event that any proposed Indebtedness meets the criteria of more than
one of the categories of Permitted Debt described in clauses (i) through
(ix) of Section 4.09(b) above, or is entitled to be incurred pursuant to
Section 4.09(a), the Company shall be permitted to classify at the time of
its incurrence such item of Indebtedness in any manner that complies with
this Section 4.09. Indebtedness under Credit Facilities outstanding on the
date on which Notes are first issued under this Indenture shall be deemed
to have been incurred on such date in reliance on the exception provided
by clause (i) of Section 4.09(b). In addition, any Indebtedness originally
classified as incurred pursuant to clauses (i) through (ix) of Section
4.09(b) may later be reclassified
55
by the Company such that it shall be deemed as having been incurred
pursuant to another of such clauses to the extent that such reclassified
Indebtedness could be incurred pursuant to such new clause at the time of
such reclassification.
(d) Notwithstanding any other provision of this Section 4.09, the
maximum amount of Indebtedness that may be incurred pursuant to this
Section 4.09 shall not be deemed to be exceeded, with respect to any
outstanding Indebtedness due solely to the result of fluctuations in the
exchange rates of currencies.
Section 4.10. Asset Sales. (a) The Company shall not, and shall not
permit any of its Restricted Subsidiaries to, consummate an Asset Sale unless:
(i) the Company (or the 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 assets or Equity Interests issued or sold or
otherwise disposed of;
(ii) such fair market value is determined by the Company's Board of
Directors and evidenced by a resolution of the Board of Directors set
forth in an Officers' Certificate delivered to the Trustee; and
(iii) at least 75% of the consideration therefor received by the
Company or such Restricted Subsidiary is in the form of cash or
Replacement Assets or a combination of both. For purposes of this clause,
each of the following shall be deemed to be cash:
(A) any liabilities (as shown on the Company's or such
Restricted Subsidiary's most recent balance sheet), of the Company or
any Restricted Subsidiary (other than contingent liabilities,
Indebtedness that is by its terms subordinated to the Notes or any
Note Guarantee and liabilities to the extent owed to the Company or
any Affiliate of the Company) that are assumed by the transferee of
any such assets pursuant to a written novation agreement that
releases the Company or such Restricted Subsidiary from further
liability; and
(B) any securities, notes or other obligations received by the
Company or any such Restricted Subsidiary from such transferee that
are converted by the Company or such Restricted Subsidiary into cash
(to the extent of the cash received in that conversion) within 90
days of the applicable Asset Sale.
(b) Within 360 days after the receipt of any Net Proceeds from an
Asset Sale, the Company may apply such Net Proceeds at its option:
(i) to repay Senior Debt and, if the Senior Debt repaid is revolving
credit Indebtedness, to correspondingly reduce commitments with respect
thereto; or
(ii) to purchase Replacement Assets or make a capital expenditure in
or that is used or useful in a Permitted Business.
56
Pending the final application of any such Net Proceeds, the Company may
temporarily reduce revolving credit borrowings or otherwise invest such Net
Proceeds in any manner that is not prohibited by this Indenture.
(c) Any Net Proceeds from Asset Sales that are not applied or
invested as provided in the preceding paragraph shall constitute "Excess
Proceeds." Within 10 days after the aggregate amount of Excess Proceeds
exceeds $20.0 million, the Company shall make an offer (an "Asset Sale
Offer") to all Holders of Notes and all holders of other Indebtedness that
is pari passu with the Notes or any Note Guarantee containing provisions
similar to those set forth in this Indenture with respect to offers to
purchase with the proceeds of sales of assets, to purchase the maximum
principal amount of Notes and such other pari passu Indebtedness that may
be purchased out of the Excess Proceeds. The offer price in any Asset Sale
Offer shall be equal to 100% of the principal amount of the Notes and such
other pari passu Indebtedness plus accrued and unpaid interest and
Liquidated Damages, if any, to the date of purchase, and shall be payable
in cash. If any Excess Proceeds remain after consummation of an Asset Sale
Offer, the Company may use such Excess Proceeds for any purpose not
otherwise prohibited by this Indenture. If the aggregate principal amount
of Notes and such other pari passu Indebtedness tendered into such Asset
Sale Offer exceeds the amount of Excess Proceeds, the Notes and such other
pari passu Indebtedness shall be purchased on a pro rata basis based on
the principal amount of Notes and such other pari passu Indebtedness
tendered. Upon completion of each Asset Sale Offer, the amount of Excess
Proceeds shall be reset at zero.
(d) Any Asset Sale Offer shall be made in accordance with Section
3.09. The Company shall comply with the requirements of Rule 14e-1 under
the Exchange Act and any other securities laws and regulations thereunder
to the extent such laws and regulations are applicable in connection with
each repurchase of Notes pursuant to an Asset Sale Offer. To the extent
that the provisions of any securities laws or regulations conflict with
this Section 4.10 or Section 3.09, the Company shall comply with the
applicable securities laws and regulations and shall not be deemed to have
breached its obligations under this Section 4.10 or Section 3.09 by virtue
of such compliance.
Section 4.11. Transactions with Affiliates. (a) The Company shall
not, and shall not permit any of its Restricted Subsidiaries to, make any
payment to, or sell, lease, transfer or otherwise dispose of any of its
properties or assets to, or purchase any property or assets from, or enter
into, make, amend, renew or extend any transaction, contract, agreement,
understanding, loan, advance or Guarantee with, or for the benefit of, any
Affiliate (each, an "Affiliate Transaction"), unless:
(i) such Affiliate Transaction is on terms that are no less favorable
to the Company or the relevant Restricted Subsidiary than those that would
have been obtained in a comparable arm's-length transaction by the Company
or such Restricted Subsidiary with a Person that is not an Affiliate of
the Company; and
(ii) the Company delivers to the Trustee:
57
(A) with respect to any Affiliate Transaction or series of
related Affiliate Transactions involving aggregate consideration in
excess of $10.0 million, a resolution of the Board of Directors of
the Company set forth in an Officers' Certificate certifying that
such Affiliate Transaction or series of related Affiliate
Transactions complies with this Section 4.11 and that such Affiliate
Transaction or series of related Affiliate Transactions has been
approved by a majority of the disinterested members of the Board of
Directors of the Company; and
(B) with respect to any Affiliate Transaction or series of
related Affiliate Transactions involving aggregate consideration in
excess of $25.0 million, an opinion as to the fairness to the Company
or such Restricted Subsidiary of such Affiliate Transaction or series
of related Affiliate Transactions from a financial point of view
issued by an independent accounting, appraisal or investment banking
firm of national standing.
(b) The following items shall not be deemed to be Affiliate
Transactions and, therefore, shall not be subject to Section 4.11(a):
(i) transactions between or among the Company and/or its Restricted
Subsidiaries;
(ii) payment of reasonable and customary fees and compensation to,
and reasonable and customary indemnification arrangements and similar
payments on behalf of, directors of the Company;
(iii) Restricted Payments that are permitted by this Indenture;
(iv) any sale of Capital Stock (other than Disqualified Stock) of the
Company;
(v) loans and advances to officers and employees of the Company or
any of its Restricted Subsidiaries for bona fide business purposes in the
ordinary course of business consistent with past practice;
(vi) any employment, consulting, service or termination agreement, or
reasonable and customary indemnification arrangements, entered into by the
Company or any of its Restricted Subsidiaries with officers and employees
of the Company or any of its Restricted Subsidiaries and the payment of
compensation to officers and employees of the Company or any of its
Restricted Subsidiaries (including amounts paid pursuant to employee
benefit plans, employee stock option or similar plans), in each case in
the ordinary course of business and consistent with past practice; and
(vii) any agreements or arrangements in effect on the Issue Date, or
any amendment, modification, or supplement thereto or any replacement
thereof, as long as such agreement or arrangement, as so amended,
modified, supplemented or replaced, taken as a whole, is not more
disadvantageous to the Company and its Restricted Subsidiaries than the
original agreement as in effect on the Issue Date, as determined in
58
good faith by the Company's Board of Directors, and any transactions
contemplated by any of the foregoing agreements or arrangements.
Section 4.12. Liens. The Company shall not, and shall not permit any
of its Restricted Subsidiaries to, create, incur, assume or otherwise cause or
suffer to exist or become effective any Lien of any kind securing Indebtedness
(other than Permitted Liens) upon any of their property or assets, now owned
or hereafter acquired, unless all payments due under this Indenture and the
Notes are secured on an equal and ratable basis with the obligations so
secured until such time as such obligations are no longer secured by a Lien.
Section 4.13. Corporate Existence. Subject to Article 5 hereof, the
Company shall do or cause to be done all things reasonably necessary to
preserve and keep in full force and effect (a) its corporate existence, and
the corporate, partnership or other existence of each of its subsidiaries, in
accordance with the respective organizational documents (as the same may be
amended from time to time) of the Company or any such subsidiary and (b) the
material rights (charter and statutory), licenses and franchises of the
Company and its subsidiaries; provided, however, that the Company shall not be
required to preserve any such right, license or franchise, or the corporate,
partnership or other existence of any of its subsidiaries, if the Board of
Directors shall determine that the preservation thereof is no longer desirable
in the conduct of the business of the Company and its subsidiaries, taken as a
whole, and that the loss thereof is not adverse in any material respect to the
Holders of the Notes.
Section 4.14. Offer to Repurchase upon Change of Control. (a) If a
Change of Control occurs, each Holder of Notes shall have the right to require
the Company to repurchase all or any part (equal to $1,000 or an integral
multiple thereof) of such Holder's Notes pursuant to the offer described below
(the "Change of Control Offer") at an offer price in cash equal to 101% of the
aggregate principal amount thereof plus accrued and unpaid interest and
Liquidated Damages thereon, if any, to the date of purchase (the "Change of
Control Payment").
(b) Within 30 days following any Change of Control, the Company shall
mail a notice to each Holder describing the transaction or transactions
that constitute the Change of Control and which shall be no earlier than
30 days and no later than 60 days from the date such notice is mailed (the
"Change of Control Payment Date") and stating that the Change of Control
Offer is being made pursuant to this Section 4.14 and that all Notes
properly tendered pursuant to the Change of Control Offer will be accepted
for payment.
(c) Any Change of Control offer shall be made in accordance with
Section 3.09. The Company shall comply with the requirements of Rule 14e-1
under the Exchange Act and any other securities laws and regulations
thereunder to the extent such laws and regulations are applicable in
connection with the repurchase of the Notes as a result of a Change of
Control. To the extent that the provisions of any securities laws or
regulations conflict with this Section 4.14, the Company shall comply with
the applicable securities laws and regulations and shall not be deemed to
have breached its obligations under this Section 4.14 by virtue of such
compliance.
59
(d) Prior to complying with this Section 4.14, but in any event
within 30 days following a Change of Control, the Company shall either
repay all outstanding Senior Debt or obtain the requisite consents, if
any, under all agreements governing outstanding Senior Debt to permit the
repurchase of Notes required by this Section 4.14.
(e) Clause (b) of this Section 4.14 shall be applicable regardless of
whether any other Sections of this Indenture are applicable. Except as
described above with respect to a Change of Control, this Indenture does
not contain provisions that permit the Holders of the Notes to require
that the Company repurchase or redeem the Notes in the event of a
takeover, recapitalization or similar transaction.
(f) 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 set forth in this Indenture applicable to a Change of
Control Offer made by the Company and purchases all Notes validly tendered
and not withdrawn under such Change of Control Offer.
Section 4.15. Limitation on Senior Subordinated Debt. The Company
shall not incur any Indebtedness that is subordinate or junior in right of
payment to any Senior Debt of the Company unless it is pari passu or
subordinate in right of payment to the Notes to the same extent. No Guarantor
shall incur any Indebtedness that is subordinate or junior in right of payment
to the Senior Debt of such Guarantor unless it is pari passu or subordinate in
right of payment to such Guarantor's Note Guarantee to the same extent. For
purposes of the foregoing, no Indebtedness will be deemed to be subordinate or
junior in right of payment to any other Indebtedness of the Company or any
Guarantor, as applicable, solely by reason of any Liens or Guarantees arising
or created in respect thereof or by virtue of the fact that the holders of any
secured Indebtedness have entered into intercreditor agreements giving one or
more of such holders priority over the other holders in the collateral held by
them.
Section 4.16. Designation of Restricted and Unrestricted
Subsidiaries. (a) The Board of Directors of the Company may designate any
Restricted Subsidiary of the Company to be an Unrestricted Subsidiary;
provided that:
(i) any Guarantee by the Company or any Restricted Subsidiary of any
Indebtedness of the Subsidiary being so designated shall be deemed to be
an incurrence of Indebtedness by the Company or such Restricted Subsidiary
(or both, if applicable) at the time of such designation, and such
incurrence of Indebtedness would be permitted under Section 4.09;
(ii) the aggregate fair market value of all outstanding Investments
owned by the Company and its Restricted Subsidiaries in the Subsidiary
being so designated (including any Guarantee by the Company or any
Restricted Subsidiary of any Indebtedness of such Subsidiary) shall be
deemed to be a Restricted Investment made as of the time of such
designation and that such Investment would be permitted under Section
4.07;
60
(iii) such Subsidiary does not own any Equity Interests of, or hold
any Liens on any property of, the Company or any Restricted Subsidiary;
(iv) the Subsidiary being so designated:
(A) is not party to any agreement, contract, arrangement or
understanding with the Company or any Restricted Subsidiary of the
Company unless the terms of any such agreement, contract, arrangement
or understanding are no less favorable to the Company or such
Restricted Subsidiary than those that might be obtained at the time
from Persons who are not Affiliates of the Company;
(B) is a Person with respect to which neither the Company nor
any of its Restricted Subsidiaries has any direct or indirect
obligation (x) to subscribe for additional Equity Interests or (y) to
maintain or preserve such Person's financial condition or to cause
such Person to achieve any specified levels of operating results;
(C) has not Guaranteed or otherwise directly or indirectly
provided credit support for any Indebtedness of the Company or any of
its Restricted Subsidiaries, except to the extent such Guarantee or
credit support would be released upon such designation; and
(D) has at least one director on its Board of Directors that is
not a director or officer of the Company or any of its Restricted
Subsidiaries and has at least one executive officer that is not a
director or officer of the Company or any of its Restricted
Subsidiaries; and
(v) no Default or Event of Default would be in existence following
such designation.
(b) Any designation of a Restricted Subsidiary of the Company as an
Unrestricted Subsidiary shall be evidenced to the Trustee by filing with
the Trustee a certified copy of the Board Resolution giving effect to such
designation and an Officers' Certificate certifying that such designation
complied with the preceding conditions and was permitted by this
Indenture. If, at any time, any Unrestricted Subsidiary would fail to meet
any of the preceding requirements described in clause (iv) above, it shall
thereafter cease to be an Unrestricted Subsidiary for purposes of this
Indenture and any Indebtedness, Investments, or Liens on the property, of
such Subsidiary shall be deemed to be incurred by a Restricted Subsidiary
of the Company as of such date and, if such Indebtedness, Investments or
Liens are not permitted to be incurred as of such date under this
Indenture, the Company shall be in default under this Indenture.
(c) The Board of Directors of the Company may at any time designate
any Unrestricted Subsidiary to be a Restricted Subsidiary; provided that:
(i) such designation shall be deemed to be an incurrence of
Indebtedness by a Restricted Subsidiary of the Company of any outstanding
Indebtedness of such
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Unrestricted Subsidiary and such designation shall only be permitted if
such Indebtedness is permitted under Section 4.09, calculated on a pro
forma basis as if such designation had occurred at the beginning of the
four-quarter reference period;
(ii) all outstanding Investments owned by such Unrestricted
Subsidiary shall be deemed to be made as of the time of such designation
and such Investments shall only be permitted if such Investments would be
permitted under Section 4.07;
(iii) all Liens upon property or assets of such Unrestricted
Subsidiary existing at the time of such designation would be permitted
under Section 4.12; and
(iv) no Default or Event of Default would be in existence following
such designation.
Section 4.17. Payments for Consent. The Company shall not, and shall
not permit any of its Restricted Subsidiaries to, directly or indirectly, pay
or cause to be paid any consideration to or for the benefit of any Holder of
Notes for or as an inducement to any consent, waiver or amendment of any of
the terms or provisions of this Indenture or the Notes unless such
consideration is offered to be paid and is paid to all Holders of the Notes
that consent, waive or agree to amend in the time frame set forth in the
solicitation documents relating to such consent, waiver or agreement.
Section 4.18. Business Activities. The Company shall not, and shall
not permit any of its Restricted Subsidiaries to, engage in any business other
than Permitted Businesses, except to such extent as would not be material to
the Company and its Restricted Subsidiaries taken as a whole.
Section 4.19. Limitation on Issuances and Sales of Equity Interests
in Restricted Subsidiaries. The Company shall not transfer, convey, sell,
lease or otherwise dispose of, and shall not permit any of its Restricted
Subsidiaries to, issue, transfer, convey, sell, lease or otherwise dispose of
any Equity Interests in any Restricted Subsidiary of the Company to any Person
(other than the Company or a Restricted Subsidiary of the Company or, if
necessary, shares of its Capital Stock constituting directors' qualifying
shares or issuances of shares of Capital Stock of foreign Restricted
Subsidiaries to foreign nationals, to the extent required by applicable law),
except:
(1) if, immediately after giving effect to such issuance, transfer,
conveyance, sale, lease or other disposition, such Restricted Subsidiary
would no longer constitute a Restricted Subsidiary and any Investment in
such Person remaining after giving effect to such issuance or sale would
have been permitted to be made under Section 4.07 if made on the date of
such issuance or sale and the cash Net Proceeds from such transfer,
conveyance, sale, lease or other disposition are applied in accordance
with Section 4.10; or
(2) other sales of Capital Stock of a Restricted Subsidiary by the
Company or a Restricted Subsidiary, provided that the Company or such
Restricted Subsidiary complies with Section 4.10.
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Section 4.20. Additional Note Guarantees. (a) If the Company or any
of its Restricted Subsidiaries acquires or creates another Domestic Subsidiary
on or after the Issue Date, then that newly acquired or created Domestic
Subsidiary must become a Guarantor and execute a supplemental indenture and
deliver an Opinion of Counsel to the Trustee.
(b) The Company shall not permit any of its Restricted Subsidiaries,
directly or indirectly, to Guarantee or pledge any assets to secure the
payment of any other Indebtedness of the Company or any Restricted
Subsidiary thereof, other than Foreign Subsidiaries, unless such
Restricted Subsidiary is a Guarantor or simultaneously executes and
delivers a supplemental indenture providing for the Guarantee of the
payment of the Notes by such Restricted Subsidiary, which Guarantee shall
be senior to or pari passu with such Subsidiary's Guarantee of such other
Indebtedness unless such other Indebtedness is Senior Debt, in which case
the Guarantee of the Notes may be subordinated to the Guarantee of such
Senior Debt to the same extent as the Notes are subordinated to such
Senior Debt. The form of the Note Guarantee is attached as Exhibit D
hereto.
(c) A Guarantor may not sell or otherwise dispose of all or
substantially all of its assets to, or consolidate with or merge with or
into (whether or not such Guarantor is the surviving Person), another
Person, other than the Company or another Guarantor, unless:
(i) immediately after giving effect to that transaction, no Default
or Event of Default exists; and
(ii) either:
(A) the Person acquiring the property in any such sale or
disposition or the Person formed by or surviving any such
consolidation or merger (if other than the Guarantor) is a
corporation organized or existing under the laws of the United
States, any state thereof or the District of Columbia and assumes all
the obligations of that Guarantor under this Indenture, its Note
Guarantee and the Registration Rights Agreement pursuant to a
supplemental indenture satisfactory to the Trustee; or
(B) such sale or other disposition or consolidation or merger
complies with Section 4.10.
(d) The Note Guarantee of a Guarantor will be released:
(i) in connection with any sale or other disposition of all of the
Capital Stock of a Guarantor to a Person that is not (either before or
after giving effect to such transaction) an Affiliate of the Company, if
the sale of all such Capital Stock of that Guarantor complies with Section
4.10;
(ii) if the Company properly designates any Restricted Subsidiary
that is a Guarantor as an Unrestricted Subsidiary under this Indenture; or
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(iii) solely in the case of a Note Guarantee created pursuant to
Section 4.20(a), upon the release or discharge of the Guarantee which
resulted in the creation of such Note Guarantee pursuant to this Section
4.20, except a discharge or release by or as a result of payment under
such Guarantee.
ARTICLE 5
SUCCESSORS
Section 5.01. Merger, Consolidation or Sale of Assets. (a) The
Company shall not, directly or indirectly consolidate or merge with or into
another Person (whether or not the Company is the surviving corporation) or
sell, assign, transfer, convey or otherwise dispose of all or substantially
all of the properties and assets of the Company and its Restricted
Subsidiaries, taken as a whole, in one or more related transactions, to
another Person or Persons, unless:
(i) either: (A) the Company is the surviving corporation; or (B) the
Person formed by or surviving any such consolidation or merger (if other
than the Company) or to which such sale, assignment, transfer, conveyance
or other disposition shall have been made (x) is a corporation organized
or existing under the laws of the United States, any state thereof or the
District of Columbia and (y) assumes all the obligations of the Company
under the Notes, this Indenture, and the Registration Rights Agreement
pursuant to agreements reasonably satisfactory to the Trustee;
(ii) immediately after giving effect to such transaction no Default
or Event of Default exists;
(iii) immediately after giving effect to such transaction on a pro
forma basis, the Company or the Person formed by or surviving any such
consolidation or merger (if other than the Company), or to which such
sale, assignment, transfer, conveyance or other disposition shall have
been made, shall, on the date of such transaction after giving pro forma
effect thereto and any related financing transactions as if the same had
occurred at the beginning of the applicable four-quarter period, be
permitted to incur at least $1.00 of additional Indebtedness pursuant to
the Fixed Charge Coverage Ratio test set forth in Section 4.09(a);
(iv) each Guarantor, unless such Guarantor is the Person with which
the Company has entered into a transaction under this Section 5.01, shall
have by amendment to its Note Guarantee confirmed that its Note Guarantee
shall apply to the obligations of the Company or the surviving Person in
accordance with the Notes and this Indenture; and
(v) the Company shall have delivered to the Trustee an Opinion of
Counsel to the effect that the Holders will not recognize income, gain or
loss for Federal income tax purposes as a result of such transaction and
will be subject to Federal income tax on the same amounts, in the same
manner and at the same times as would have been the case if such
transaction had not occurred.
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(b) Neither the Company nor any Restricted Subsidiary may, directly
or indirectly, lease all or substantially all of its properties or assets,
in one or more related transactions, to any other Person. Clause (iii)
above of this Section 5.01 shall not apply to any merger, consolidation or
sale, assignment, transfer, lease, conveyance or other disposition of
assets between or among the Company and any of its Restricted
Subsidiaries.
Section 5.02. Successor Corporation Substituted. Upon any
consolidation or merger, or any sale, assignment, transfer, conveyance or
other disposition of all or substantially all of the assets of the Company in
accordance with Section 5.01 hereof, the successor corporation formed by such
consolidation or into or with which the Company is merged or to which such
sale, assignment, transfer, conveyance or other disposition is made shall
succeed to, and be substituted for (so that from and after the date of such
consolidation, merger, sale, conveyance or other disposition, the provisions
of this Indenture referring to the "Company" shall refer instead to the
successor corporation and not to the Company), and may exercise every right
and power of the Company under this Indenture with the same effect as if such
successor Person had been named as the Company herein; provided, however, that
the predecessor Company shall not be relieved from the obligation to pay the
principal of and interest on the Notes except in the case of a sale of all of
the Company's assets that meets the requirements of Section 5.01 hereof.
ARTICLE 6
DEFAULTS AND REMEDIES
Section 6.01. Events of Default. Each of the following is an "Event
of Default":
(i) default for 30 days in the payment when due of interest on, or
Liquidated Damages with respect to, the Notes whether or not prohibited by
Article 10 of this Indenture;
(ii) default in payment when due (whether at maturity, upon
acceleration, redemption or otherwise) of the principal of, or premium, if
any, on the Notes, whether or not prohibited by Article 10 of this
Indenture;
(iii) failure by the Company or any of its Restricted Subsidiaries to
comply with Section 4.10, Section 4.14, Section 4.20(c) or Section 5.01;
(iv) failure by the Company or any of its Restricted Subsidiaries for
60 days after written notice by the Trustee or Holders representing 25% or
more of the aggregate principal amount of Notes outstanding to comply with
any of the other agreements in this Indenture;
(v) default under any mortgage, indenture or instrument under which
there may be issued or by which there may be secured or evidenced any
Indebtedness for money borrowed by the Company or any of its Restricted
Subsidiaries (or the payment of
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which is Guaranteed by the Company or any of its Restricted Subsidiaries)
whether such Indebtedness or Guarantee now exists, or is created after the
Issue Date, if that default:
(A) is caused by a failure to make any payment when due at the
final maturity of such Indebtedness (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 $25.0 million or more;
(vi) failure by the Company or any of its Restricted Subsidiaries to
pay final judgments (to the extent such judgments are not paid or covered
by insurance provided by a carrier that has acknowledged coverage in
writing and has the ability to perform) aggregating in excess of $25.0
million, which judgments are not paid, discharged or stayed for a period
of 60 days;
(vii) except as permitted by this Indenture, any Note Guarantee shall
be held in any judicial proceeding to be unenforceable or invalid or shall
cease for any reason to be in full force and effect or any Guarantor, or
any Person acting on behalf of any Guarantor, shall deny or disaffirm its
obligations under its Note Guarantee; and
(viii) the Company or any of its Restricted Subsidiaries that is a
Significant Subsidiary (or any group of Restricted Subsidiaries that
together would constitute a Significant Subsidiary of the Company),
pursuant to or within the meaning of Bankruptcy Law:
(A) commences a voluntary case,
(B) consents to the entry of an order for relief against it in
an involuntary case,
(C) makes a general assignment for the benefit of its creditors,
or
(D) generally is not paying its debts as they become due; and
(ix) a court of competent jurisdiction enters an order or decree
under any Bankruptcy Law that:
(A) is for relief against the Company or any of its Restricted
Subsidiaries that is a Significant Subsidiary (or any group of
Restricted Subsidiaries that together would constitute a Significant
Subsidiary of the Company), in an involuntary case;
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(B) appoints a custodian of the Company or any of its Restricted
Subsidiaries that is a Significant Subsidiary (or any group of
Restricted Subsidiaries that together would constitute a Significant
Subsidiary of the Company) or for all or substantially all of the
property of the Company or any of its Restricted Subsidiaries that is
a Significant Subsidiary (or any group of Restricted Subsidiaries
that together would constitute a Significant Subsidiary of the
Company), or
(C) orders the liquidation of the Company or any of its
Restricted Subsidiaries that is a Significant Subsidiary (or any
group of Restricted Subsidiaries that together would constitute a
Significant Subsidiary of the Company);
and the order or decree remains undismissed or unstayed and in effect
for 60 consecutive days.
Section 6.02. Acceleration. In the case of an Event of Default
specified in clause (viii) or (ix) of Section 6.01 with respect to the
Company, any Guarantor or any Significant Subsidiary (or any group of
Restricted Subsidiaries that together would constitute a Significant
Subsidiary of the Company), all outstanding Notes will become due and payable
immediately without further action or notice. If any other Event of Default
occurs and is continuing, the Trustee or the Holders of at least 25% in
principal amount of the then outstanding Notes may declare all the Notes to be
due and payable immediately by notice in writing to the Company specifying the
Event of Default.
In the event of a declaration of acceleration of the Notes because an
Event of Default has occurred and is continuing as a result of the
acceleration of any Indebtedness described in clause (v) of Section 6.01
hereof, the declaration of acceleration of the Notes shall be automatically
annulled if the holders of any Indebtedness described in clause (v) of Section
6.01 hereof have rescinded the declaration of acceleration in respect of the
Indebtedness if:
(i) the annulment of the acceleration of Notes would not conflict
with any judgment or decree of a court of competent jurisdiction; and
(ii) all existing Events of Default, except nonpayment of principal
or interest on the Notes that became due solely because of the
acceleration of the Notes, have been cured or waived.
In the case of any Event of Default occurring by reason of any
willful action or inaction taken or not taken by or on behalf of the Company
with the intention of avoiding payment of the premium that the Company would
have had to pay if the Company then had elected to redeem the Notes pursuant
to Section 3.07 hereof, an equivalent premium shall also become and be
immediately due and payable to the extent permitted by law upon the
acceleration of the Notes. If an Event of Default occurs prior to February 1,
2010, by reason of any willful action (or inaction) taken (or not taken) by or
on behalf of the Company with the intention of avoiding the prohibition on
redemption of the Notes, prior to February 1, 2010, then
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the premium specified in Section 3.07(b) shall also become immediately due and
payable to the extent permitted by law upon the acceleration of the Notes.
Section 6.03. Other Remedies. If an Event of Default occurs and is
continuing, the Trustee may pursue any available remedy to collect the payment
of principal, premium, if any, and Liquidated Damages, if any, and interest,
if any, on the Notes or to enforce the performance of any provision of the
Notes or this Indenture.
The Trustee may maintain a proceeding even if it does not possess any
of the Notes or does not produce any of them in the proceeding. A delay or
omission by the Trustee or any Holder of a Note 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. All
remedies are cumulative to the extent permitted by law.
Section 6.04. Waiver of Past Defaults. Holders of a majority in
aggregate principal amount of the then outstanding Notes by notice to the
Trustee may on behalf of the Holders of all of the Notes waive any existing
Default or Event of Default and its consequences hereunder (including
rescinding any related acceleration of the payment of the Notes), except a
continuing Default or Event of Default (and any related acceleration of the
payment of the Notes) in the payment of the principal of, premium and
Liquidated Damages, if any, or interest on, the Notes. 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. In case of any such waiver, the Company, the Trustee and the
Holders shall be restored to their former positions and rights hereunder and
under the Notes, respectively. This Section 6.04 shall be in lieu of Section
316(a)(1)(B) of the TIA and such Section 316(a)(1)(B) of the TIA is hereby
expressly excluded from this Indenture and the Notes, as permitted by the TIA.
Upon any such waiver, such Default shall cease to exist, and any Event of
Default arising therefrom shall be deemed to have been cured for every purpose
of this Indenture; but no such waiver shall extend to any subsequent or other
Default or impair any right consequent thereon.
Section 6.05. Control by Majority. Subject to Section 2.09, holders
of a majority in principal amount of the then outstanding Notes may direct the
time, method and place of conducting any proceeding for exercising any remedy
available to the Trustee or exercising any trust or power conferred on it.
However, the Trustee may refuse to follow any direction that conflicts with
law or this Indenture, that may involve the Trustee in personal liability or
that the Trustee determines in good faith may be unduly prejudicial to the
rights of Holders of Notes not joining in the giving of such direction, and
the Trustee shall have the right to decline to follow any such direction, if
the Trustee, being advised by counsel, determines that such action so directed
may not be lawfully taken or if the Trustee, in good faith shall by a
Responsible Officer, determine that the proceedings so directed 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
satisfactory to it in its sole discretion against any loss or expense caused
by taking such action or following such direction. This Section 6.05 shall be
in lieu of Section 316(a)(1)(A) of the TIA, and such Section 316(a)(1)(A) of
the TIA is hereby expressly excluded from this Indenture and the Notes, as
permitted by the TIA.
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Section 6.06. Limitation on Suits. A Holder of a Note may not pursue
a remedy with respect to this Indenture, the Notes or the Note Guarantees
unless:
(a) the Holder of a Note gives to the Trustee written notice of a
continuing Event of Default;
(b) the Holders of at least 25% in aggregate principal amount of the
then outstanding Notes make a written request to the Trustee to pursue the
remedy;
(c) such Holder of a Note or Holders of Notes offer and, if
requested, provide to the Trustee indemnity satisfactory to the Trustee
against any loss, liability or expense;
(d) the Trustee does not comply with the request within 60 days after
receipt of the request and the offer and, if requested, the provision of
indemnity; and
(e) during such 60-day period the Holders of a majority in principal
amount of the then outstanding Notes do not give the Trustee a direction
inconsistent with the request.
A Holder of a Note may not use this Indenture to prejudice the rights
of another Holder of a Note or to obtain a preference or priority over another
Holder of a Note.
Section 6.07. Rights of Holders of Notes to Receive Payment.
Notwithstanding any other provision of this Indenture, the right of any Holder
of a Note to receive payment of principal, premium, if any, and Liquidated
Damages, if any, and interest on the Note, on or after the respective due dates
expressed in the Note (including in connection with an offer to purchase), 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 such
Holder.
Section 6.08. Collection Suit by Trustee. If an Event of Default
specified in Section 6.01 occurs and is continuing, the Trustee is authorized
to recover judgment in its own name and as trustee of an express trust against
the Company for the whole amount of principal of, premium and Liquidated
Damages, if any, and interest remaining unpaid on the Notes and interest on
overdue principal and, to the extent lawful, interest 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 is
authorized to 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, disbursements
and advances of the Trustee, its agents and counsel) and the Holders of the
Notes allowed in any judicial proceedings relative to the Company or any
Guarantor (or any other obligor upon the Notes), its creditors or its property
and shall be entitled and empowered to collect, receive and distribute any
money or other securities or property payable or deliverable on any such
claims and any custodian in any such judicial proceeding is hereby authorized
by each Holder 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 Holders,
to pay to the Trustee any amount due to it for the reasonable compensation,
expenses, disbursements and advances of the Trustee, its agents
69
and counsel, and any other amounts due the Trustee under Section 7.07 hereof.
To the extent that the payment of any such compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel, and any
other amounts due the Trustee under Section 7.07 hereof out of the estate in
any such proceeding, shall be denied for any reason, payment of the same shall
be secured by a Lien on, and shall be paid out of, any and all distributions,
dividends, money, securities and other properties that the Holders may be
entitled to receive in such proceeding whether in liquidation or under any
plan of reorganization or arrangement or otherwise. Nothing herein contained
shall be deemed to authorize the Trustee to authorize or consent to or accept
or adopt on behalf of any Holder any plan of reorganization, arrangement,
adjustment or composition affecting the Notes or the rights of any Holder, or
to authorize the Trustee to vote in respect of the claim of any Holder in any
such proceeding.
Section 6.10. Priorities. If the Trustee collects any money pursuant
to this Article, it shall pay out the money in the following order:
First: to the Trustee, its agents and attorneys for amounts due under
Section 7.07 hereof, including payment of all compensation, expense and
liabilities incurred, and all advances made, by the Trustee and the costs
and expenses of collection;
Second: to Holders of Notes for amounts due and unpaid on the Notes
for principal, premium, if any, and Liquidated Damages, if any, and
interest, ratably, without preference or priority of any kind, according
to the amounts due and payable on the Notes for principal, premium, if
any, and Liquidated Damages, if any and interest, respectively; and
Third: to the Company or to such party as a court of competent
jurisdiction shall direct.
The Trustee may fix a record date and payment date for any payment to
Holders of Notes 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 a 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, 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 does not apply to
a suit by the Trustee, a suit by a Holder of a Note pursuant to Section 6.07
hereof, or a suit by Holders of more than 10% in principal amount of the then
outstanding Notes.
Section 6.12. Restoration of Rights and Remedies. If the Trustee or
any Holder has instituted any proceeding to enforce any right or remedy under
this Indenture and such proceeding has been discontinued or abandoned for any
reason, or has been determined adversely to the Trustee or to such Holder,
then and in every such case, subject to any determination in such proceeding,
the Company, any Subsidiary Guarantor, the Trustee and the Holders shall be
restored severally and respectively to their former positions hereunder and
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thereafter all rights and remedies of the Trustee and the Holders shall
continue as though no such proceeding had been instituted.
Section 6.13. Rights and Remedies Cumulative. Except as otherwise
provided with respect to the replacement or payment of mutilated, destroyed,
lost or stolen Notes in Section 2.07, no right or remedy herein conferred upon
or reserved to the Trustee or to the Holders is intended to be exclusive of
any other right or remedy, and every right and remedy shall, to the extent
permitted by law, be cumulative and in addition to every other right and
remedy given hereunder or now or hereafter existing at law or in equity or
otherwise. The assertion of any right or remedy hereunder, or otherwise, shall
not prevent the concurrent assertion or employment of any other appropriate
right or remedy.
Section 6.14. Delay or Omission Not Waiver. No delay or omission of
the Trustee or of any Holder of any Note to exercise any right or remedy
accruing upon any Event of Default shall impair any such right or remedy or
constitute a waiver of any such Event of Default or an acquiescence therein.
Every right and remedy given by this Article Six or by law to the Trustee or
to the Holders may be exercised from time to time, and as often as may be
deemed expedient, by the Trustee or by the Holders, as the case may be.
Section 6.15. Record Date. The Company may set a record date for
purposes of determining the identity of Holders entitled to vote or to consent
to any action by vote or consent authorized or permitted by Sections 6.04,
6.05 and 9.02. Unless the Company provides otherwise, such record date shall
be the later of 30 days prior to the first solicitation of such consent or the
date of the most recent list of Holders furnished to the Trustee pursuant to
Section 2.05 prior to such solicitation.
ARTICLE 7
TRUSTEE
Section 7.01. Duties of Trustee. (a) If an Event of Default 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 its exercise, as a prudent person would exercise or use under the
circumstances in the conduct of its own affairs.
(b) Except during the continuance of an Event of Default:
(i) the duties of the Trustee shall be determined solely by this
Indenture and the Trustee need perform only those duties that are
specifically set forth in this Indenture and no others, and no implied
covenants or obligations shall be read into this Indenture against the
Trustee; and
(ii) 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 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 (but need
71
not confirm or investigate the accuracy of mathematical calculations or
other facts purported to be stated therein).
(c) The Trustee may not be relieved from liabilities for its own
negligent action, its own negligent failure to act, or its own willful
misconduct, except that:
(i) this paragraph does not limit the effect of paragraph (b) of this
Section;
(ii) the Trustee shall not be liable for any error of judgment made
in good faith by a Responsible Officer, unless it is proved that the
Trustee was negligent in ascertaining the pertinent facts; and
(iii) 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 hereof.
(d) Whether or not therein expressly so provided, every provision of
this Indenture that in any way relates to the Trustee is subject to
paragraphs (a), (b), and (c) of this Section.
(e) No provision of this Indenture shall require the Trustee to
expend or risk its own funds or incur any liability. The Trustee shall be
under no obligation to exercise any of its rights and powers under this
Indenture at the request of any Holders, unless such Holder shall have
offered to the Trustee security and indemnity satisfactory to it against
any loss, liability or expense.
(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 or assets held in trust by the Trustee need not be
segregated from other funds or assets except to the extent required by
law.
Section 7.02. Rights of Trustee. (a) The Trustee may conclusively
rely upon any document (whether in its original or facsimile form) 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 consult
with counsel and may require (other than in connection with the Exchange
Offer contemplated by Section 2.06(f) unless required by the TIA) an
Officers' Certificate or an Opinion of Counsel or both. The Trustee shall
not be liable for any action it takes or omits to take in good faith in
reliance on such Officers' Certificate or Opinion of Counsel. The Trustee
may consult with counsel and the advice of such counsel or any Opinion of
Counsel shall be full and complete authorization and protection from
liability in respect of any action taken, suffered or omitted by it
hereunder in good faith and in reliance thereon.
(c) The Trustee may act through its attorneys and agents and shall
not be responsible for the misconduct or negligence of any agent or
attorney appointed with due care.
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(d) The Trustee shall not be liable for any action it takes or omits
to take in good faith that it believes to be authorized or within the
rights or powers conferred upon it by this Indenture.
(e) Unless otherwise specifically provided in this Indenture, any
demand, request, direction or notice from the Company shall be sufficient
if signed by an Officer of the Company.
(f) The Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Indenture at the request or
direction of any of the Holders unless such Holders shall have offered to
the Trustee reasonable security or indemnity satisfactory to it against
the costs, expenses and liabilities that might be incurred by it in
compliance with such request or direction.
(g) Except with respect to Section 4.01, the Trustee shall have no
duty to inquire as to the performance of the Company with respect to the
covenants contained in Article 4. In addition, the Trustee shall not be
deemed to have knowledge of a Default or an Event of Default except (i)
any Default or Event of Default occurring pursuant to Sections 4.01,
6.01(i) or 6.01(ii) or (ii) any Default or Event of Default of which the
Trustee shall have received written notification or obtained actual
knowledge.
(h) Delivery of reports, information and documents to the Trustee
under Section 4.03 is for informational purposes only and the Trustee's
receipt of the foregoing shall not constitute constructive notice of any
information contained therein or determinable from information contained
therein, including the Company's compliance with any of their covenants
hereunder (as to which the Trustee is entitled to rely exclusively on
Officers' Certificates).
Section 7.03. Individual Rights of Trustee. The Trustee in its
individual or any other capacity may become the owner or pledgee of Notes and
may otherwise deal with the Company or any Affiliate of the Company with the
same rights it would have if it were not Trustee. However, in the event that
the Trustee acquires any conflicting interest that would require the Trustee
to resign it must eliminate such conflict within 90 days, apply to the SEC for
permission to continue as trustee or resign. Any Agent may do the same with
like rights and duties. The Trustee is also subject to Sections 7.10 and 7.11
hereof.
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 Notes, it shall not be accountable for the Company's use
of the proceeds from the Notes or any money paid to the Company or upon the
Company's direction under any provision of this Indenture, it shall not be
responsible for the use or application of any money received by any Paying
Agent other than the Trustee, and it shall not be responsible for any
statement or recital herein or any statement in the Notes or any other
document in connection with the sale of the Notes or pursuant to this
Indenture other than its certificate of authentication.
Section 7.05. Notice of Defaults. If a Default or Event of Default
occurs and is continuing and if it is known to the Trustee, the Trustee shall
mail to the Holders of the Notes a
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notice of the Default or Event of Default within 90 days after it occurs.
Except in the case of a Default or Event of Default in payment of principal
of, premium and Liquidated Damages, if any, or interest on any Note, the
Trustee may withhold the notice if and so long as the board of directors, the
executive committee or a committee of its Responsible Officers in good faith
determines that withholding the notice is in the interests of the Holders of
the Notes.
Section 7.06. Reports by Trustee to the Holders of the Notes. Within
60 days after each May 15 beginning with the May 15 following the Issue Date,
and for so long as Notes remain outstanding, the Trustee shall mail to the
Holders of the Notes a brief report dated as of such reporting date that
complies with TIA ss. 313(a) (but if no event described in TIA ss. 313(a) has
occurred within the twelve months preceding the reporting date, no report need
be transmitted). The Trustee also shall comply with TIA ss. 313(b)(2). The
Trustee shall also transmit by mail all reports as required by TIA ss. 313(c).
A copy of each report at the time of its mailing to the Holders of
the Notes shall be mailed to the Company and filed with the SEC and each stock
exchange on which the Notes are listed in accordance with TIA ss. 313(d). The
Company shall promptly notify the Trustee when the Notes are 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 acceptance of this
Indenture and 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 promptly upon request for all reasonable
disbursements, advances and expenses incurred or made by it in addition to the
compensation for its services. Such expenses shall include the reasonable
compensation, disbursements and expenses of the Trustee's agents and counsel
and any taxes or other expenses incurred by a trust created pursuant to Section
8.04 hereof.
The Company shall indemnify the Trustee and its agents against any
and all losses, liabilities, claims, damages or expenses (including
compensation, fees, disbursements and expenses of Trustee's agents and
counsel) incurred by it arising out of or in connection with the acceptance or
administration of its duties under this Indenture, including the costs and
expenses of enforcing this Indenture against the Company (including this
Section 7.07) and defending itself against any claim (whether asserted by the
Company or any Holder or any other person) or liability in connection with the
exercise or performance of any of its powers or duties hereunder, except to
the extent any such loss, liability or expense is judicially determined to
have been caused by to its own negligence or bad faith. The Trustee shall
notify the Company promptly of any claim for which it may seek indemnity.
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. The Trustee may have separate counsel
and the Company shall pay the reasonable fees and expenses of such counsel.
The Company need not pay for any settlement made without its consent, which
consent shall not be unreasonably withheld.
The obligations of the Company under this Section 7.07 shall survive
the satisfaction and discharge of this Indenture.
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To secure the Company's payment obligations in this Section 7.07, the
Trustee shall have a Lien prior to the Notes on all money or property held or
collected by the Trustee, except that held in trust to pay principal and
interest on particular Notes. Such Lien shall survive the satisfaction and
discharge of this Indenture. The Trustee's right to receive payment of any
amounts due under this Section 7.07 shall not be subordinated to any other
liability or Indebtedness of the Company.
When the Trustee incurs expenses or renders services after an Event
of Default specified in Section 6.01(viii) or (ix) hereof occurs, the expenses
and the compensation for the services (including the fees and expenses of its
agents and counsel) are intended to constitute expenses of administration
under any Bankruptcy Law.
The Trustee shall comply with the provisions of TIA ss. 313(b)(2) to
the extent applicable.
Section 7.08. Replacement of Trustee. A resignation or removal of the
Trustee and appointment of a successor Trustee shall become effective only
upon the successor Trustee's acceptance of appointment as provided in this
Section 7.08.
The Trustee may resign in writing at any time and be discharged from
the trust hereby created by so notifying the Company. The Holders of a
majority in principal amount of the then outstanding Notes may remove the
Trustee by so notifying the Trustee and the Company in writing. The Company
may remove the Trustee if:
(a) the Trustee fails to comply with Section 7.10 hereof;
(b) the Trustee is adjudged a bankrupt or an insolvent or an order
for relief is entered with respect to the Trustee under any Bankruptcy
Law;
(c) a custodian or public officer takes charge of the Trustee or its
property; or
(d) the Trustee becomes incapable of acting.
If the Trustee resigns or is removed or if a vacancy exists in the
office of Trustee for any reason, the Company 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 then outstanding Notes
may appoint a successor Trustee to replace the successor Trustee appointed by
the Company.
If a successor Trustee does not take office within 60 days after the
retiring Trustee resigns or is removed, the retiring Trustee, the Company, or
the Holders of Notes of at least 10% in principal amount of the then
outstanding Notes may petition at the expense of the Company any court of
competent jurisdiction for the appointment of a successor Trustee.
If the Trustee, after written request by any Holder of a Note who has
been a Holder of a Note for at least six months, fails to comply with Section
7.10, such Holder of a Note may petition any court of competent jurisdiction
for the removal of the Trustee and the appointment of a successor Trustee.
75
A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Company. Thereupon, 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. The successor Trustee shall mail a notice of its
succession to Holders of the Notes. The retiring Trustee shall promptly
transfer all property held by it as Trustee to the successor Trustee, provided
all sums owing to the Trustee hereunder have been paid and subject to the Lien
provided for in Section 7.07 hereof. Notwithstanding replacement of the
Trustee pursuant to this Section 7.08, the Company's obligations under Section
7.07 hereof shall continue for the benefit of the retiring Trustee.
Section 7.09. Successor Trustee by Merger, Etc. If the Trustee
consolidates, merges or converts into, or transfers all or substantially all
of its corporate trust business to, another corporation, the successor
corporation without any further act shall be the successor Trustee.
Section 7.10. Eligibility; Disqualification. There shall at all times
be a Trustee hereunder that is a corporation organized and doing business
under the laws of the United States of America or of any state thereof that is
authorized under such laws to exercise corporate trustee power, that is
subject to supervision or examination by federal or state authorities and that
has a combined capital and surplus of at least $50 million as set forth in its
most recent published annual report of condition.
This Indenture shall always have a Trustee who satisfies the
requirements of TIA ss.ss. 310(a)(1), (2) and (5). The Trustee is subject to
TIA ss. 310(b); provided, however, that there shall be excluded from the
operation of TIA ss. 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 ss. 310(b)(1) are met.
Section 7.11. Preferential Collection of Claims Against Company. The
Trustee is subject to TIA ss. 311(a), excluding any creditor relationship
listed in TIA ss. 311(b). A Trustee who has resigned or been removed shall be
subject to TIA ss. 311(a) to the extent indicated therein. The Trustee hereby
waives any right to set off any claim that it may have against the Company in
any capacity (other than as Trustee and Paying Agent) against any of the
assets of the Company held by the Trustee; provided, however, that if the
Trustee is or becomes a lender of any other Indebtedness permitted hereunder
to be pari passu with the Notes, then such waiver shall not apply to the
extent of such Indebtedness.
ARTICLE 8
LEGAL DEFEASANCE AND COVENANT DEFEASANCE; SATISFACTION AND DISCHARGE
Section 8.01. Option to Effect Legal Defeasance or Covenant
Defeasance. The Company may, at the option of its Board of Directors evidenced
by a resolution set forth in an Officers' Certificate, at any time, elect to
have either Section 8.02 or Section 8.03 hereof be
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applied to all outstanding Notes upon compliance with the conditions set forth
below in this Article 8.
Section 8.02. Legal Defeasance and Discharge. Upon the Company's
exercise under Section 8.01 hereof of the option applicable to this Section
8.01, the Company shall, subject to the satisfaction of the conditions set
forth in Section 8.04 hereof, be deemed to have been discharged from its
obligations with respect to all outstanding Notes and all obligations of the
Guarantors shall be deemed to have been discharged with respect to their
obligations under the Note Guarantees on the date the conditions set forth
below are satisfied (hereinafter, "Legal Defeasance"). For this purpose, Legal
Defeasance means that the Company and the Guarantors shall be deemed to have
paid and discharged the entire Indebtedness represented by the outstanding
Notes and Note Guarantees, respectively, which shall thereafter be deemed to
be "outstanding" only for the purposes of Section 8.08 hereof and the other
Sections of this Indenture referred to in (a) and (b) below, and to have
satisfied all its other obligations under such Notes and this Indenture (and
the Trustee, on demand of and at the expense of the Company, shall execute
proper instruments acknowledging the same), except for the following clauses,
which shall survive until otherwise terminated or discharged hereunder: (a)
the rights of Holders of outstanding Notes to receive solely from the trust
fund described in Section 8.04 hereof, and as more fully set forth in such
Section, payments in respect of the principal of, premium and Liquidated
Damages, if any, and interest on such Notes when such payments are due, (b)
the Company's obligations with respect to such Notes under Article 2 and
Section 4.02 hereof, (c) the rights, powers, trusts, duties and immunities of
the Trustee hereunder and the Company's obligations in connection therewith
and (d) this Article 8. Subject to compliance with this Article 8, the Company
may exercise its option under this Section 8.02 notwithstanding the prior
exercise of its option under Section 8.03 hereof.
Section 8.03. Covenant Defeasance. Upon the Company's exercise under
Section 8.01 hereof of the option applicable to this Section 8.03, the Company
and each of the Guarantors shall, subject to the satisfaction of the
conditions set forth in Section 8.04 hereof, be released from their respective
obligations under the covenants set forth in Sections 4.07, 4.08, 4.09, 4.10,
4.11, 4.12, 4.13, 4.14, 4.15, 4.16, 4.17, 4.18, 4.19 and 4.20, hereof with
respect to the outstanding Notes on and after the date the conditions set
forth in Section 8.04 are satisfied (hereinafter, "Covenant Defeasance"), and
the Notes shall thereafter be deemed not "outstanding" for the purposes 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 (it being
understood that such Notes shall not be deemed outstanding for accounting
purposes). For this purpose, Covenant Defeasance means that, with respect to
the outstanding Notes, the Company 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 hereof, but, except as specified above, the remainder of this
Indenture and such Notes shall be unaffected thereby. In addition, upon the
Company's exercise under Section 8.01 hereof of the option applicable to this
Section 8.03, subject to the satisfaction of the conditions set forth in
Section 8.04 hereof, clauses (i) through (iii) of Section 6.01 and
77
clauses (v) through (vii) of Section 6.01 hereof shall cease to operate and
not constitute Events of Default.
Section 8.04. Conditions to Legal Defeasance or Covenant Defeasance.
The following shall be the conditions to the application of either Section
8.02 or 8.03 hereof to the outstanding Notes:
In order to exercise either Legal Defeasance or Covenant Defeasance:
(a) the Company shall irrevocably deposit with the Trustee, in trust,
for the benefit of the Holders of the Notes, cash in U.S. dollars,
non-callable Government Securities, or a combination thereof, in such
amounts as shall be sufficient, in the opinion of a nationally recognized
firm of independent public accountants, to pay the principal of, premium
and Liquidated Damages, if any, and interest on the outstanding Notes on
the Stated Maturity or on the applicable redemption date, as the case may
be, and the Company shall specify whether the Notes are being defeased to
maturity or to a particular redemption date;
(b) in the case of an election under Section 8.02 hereof, the Company
shall have delivered to the Trustee an Opinion of Counsel reasonably
acceptable to the Trustee confirming that (i) the Company has received
from, or there has been published by, the Internal Revenue Service a
ruling or (ii) 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 confirm that, the Holders of
the outstanding Notes shall not recognize income, gain or loss for federal
income tax purposes as a result of such Legal Defeasance and shall be
subject to federal income tax on the same amounts, in the same manner and
at the same times as would have been the case if such Legal Defeasance had
not occurred;
(c) in the case of an election under Section 8.03 hereof, the Company
shall have delivered to the Trustee an Opinion of Counsel reasonably
acceptable to the Trustee confirming that the Holders of the outstanding
Notes shall not recognize income, gain or loss for federal income tax
purposes as a result of such Covenant Defeasance and shall be subject to
federal income tax on the same amounts, in the same manner and at the same
times as would have been the case if such Covenant Defeasance had not
occurred;
(d) no Default or Event of Default shall have occurred and be
continuing either (i) on the date of such deposit, or (ii) insofar as an
Event of Default set forth in Section 6.01(viii) shall have occurred and
be continuing, at any time in the period ending on the 123rd day after the
date of deposit;
(e) such Legal Defeasance or Covenant Defeasance shall not result in
a breach or violation of, or constitute a default under any material
agreement or instrument (other than this Indenture) to which the Company
or any of its Subsidiaries is a party or by which the Company or any of
its Subsidiaries is bound;
(f) the Company shall have delivered to the Trustee an Opinion of
Counsel to the effect that, (i) assuming no intervening bankruptcy of the
Company or any Guarantor
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between the date of deposit and the 123rd day following the deposit and
assuming that no Holder is an "insider" of the Company under applicable
bankruptcy law, after the 123rd day following the deposit, the trust funds
shall not be subject to the effect of Section 547 of the United States
Bankruptcy Code or Section 15 of the New York Debtor and Creditor Law and
(ii) the creation of the defeasance trust does not violate the Investment
Company Act of 1940;
(g) the Company shall have delivered to the Trustee an Officers'
Certificate stating that the deposit was not made by the Company with the
intent of preferring the Holders of Notes over any other creditors of the
Company with the intent of defeating, hindering, delaying or defrauding
any other creditors of the Company or others;
(h) if the Notes are to be redeemed prior to their Stated Maturity,
the Company shall have delivered to the Trustee irrevocable instructions
to redeem all of the Notes on the specified redemption date; and
(i) the Company shall have delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all conditions
precedent, including, without limitation, the conditions set forth in this
Section 8.04, provided for or relating to the Legal Defeasance or the
Covenant Defeasance have been complied with.
Section 8.05. Satisfaction and Discharge of Indenture. This Indenture
shall be discharged and shall cease to be of further effect as to all Notes
issued hereunder when:
(i) either:
(A) all Notes that have been authenticated (except lost, stolen
or destroyed Notes that have been replaced or paid and Notes for
whose payment money has theretofore been deposited in trust and
thereafter repaid to the Company) have been delivered to the Trustee
for cancellation; or
(B) all Notes that have not been delivered to the Trustee for
cancellation have become due and payable by reason of the making of a
notice of redemption or otherwise or will become due and payable
within one year and the Company or any Guarantor has irrevocably
deposited or caused to be deposited with the Trustee as trust funds
in trust solely for the benefit of the Holders, cash in U.S. dollars,
non-callable Government Securities, or a combination thereof, in such
amounts as will be sufficient without consideration of any
reinvestment of interest, to pay and discharge the entire
indebtedness on the Notes not delivered to the Trustee for
cancellation for principal, premium, if any, and Liquidated Damages,
if any, and accrued interest to the date of maturity or redemption;
(ii) no Default or Event of Default shall have occurred and be
continuing on the date of such deposit or shall occur as a result of such
deposit and such deposit will not result in a breach or violation of, or
constitute a default under, any other instrument to which the Company or
any Guarantor is a party or by which the Company or any Guarantor is
bound;
79
(iii) the Company or any Guarantor has paid or caused to be paid all
sums payable by it under this Indenture; and
(iv) the Company has delivered irrevocable instructions to the
Trustee under this Indenture to apply the deposited money toward the
payment of the Notes at maturity or the redemption date, as the case may
be.
In addition, the Company must deliver an Officers' Certificate and an
Opinion of Counsel to the Trustee stating that all conditions precedent to
satisfaction and discharge have been satisfied.
Section 8.06. Survival of Certain Obligations. Notwithstanding
Sections 8.02, 8.03 and 8.05, any obligations of the Company and the
Guarantors in Sections 2.03 through 2.16 (excluding Sections 2.08 and 2.14),
6.07, 7.07, 7.08, and 8.07 through 8.11 shall survive until the Notes have
been paid in full. Thereafter, any obligations of the Company and the
Guarantors in Sections 7.07, 8.07, 8.08 and 8.10 shall survive such
satisfaction and discharge. Nothing contained in this Article Eight shall
abrogate any of the obligations or duties of the Trustee under this Indenture.
Section 8.07. Acknowledgment of Discharge by Trustee. After the
conditions of Section 8.02, 8.03 or 8.05 have been satisfied, the Trustee upon
written request shall acknowledge in writing the discharge of all of the
Company's obligations under this Indenture except for those surviving
obligations specified in this Article Eight.
Section 8.08. Deposited Money and Cash Equivalents to Be Held in
Trust; Other Miscellaneous Provisions. Subject to Section 8.09 hereof, all
money and non-callable Cash Equivalents (including the proceeds thereof)
deposited with the Trustee (or other qualifying trustee, collectively for
purposes of this Section 8.08, the "Trustee") pursuant to Section 8.04 hereof
in respect of the outstanding Notes shall be held in trust and applied by the
Trustee, in accordance with the provisions of such Notes and this Indenture,
to the payment, either directly or through any Paying Agent (including the
Company acting as Paying Agent) as the Trustee may determine, to the Holders
of such Notes of all sums due and to become due thereon in respect of
principal, premium, if any, and Liquidated Damages, if any, and interest, but
such money need not be segregated from other funds except to the extent
required by law.
The Company shall pay and indemnify the Trustee against any tax, fee
or other charge imposed on or assessed against the cash or non-callable Cash
Equivalents deposited pursuant to Section 8.04(a) hereof or the principal and
interest received in respect thereof other than any such tax, fee or other
charge which by law is for the account of the Holders of the outstanding
Notes.
Anything in this Article 8 to the contrary notwithstanding, the
Trustee shall deliver or pay to the Company from time to time upon the request
of the Company any money or non-callable Cash Equivalents held by it as
provided in Section 8.04 hereof which, in the opinion of a nationally
recognized firm of independent public accountants expressed in a written
certification thereof delivered to the Trustee (which may be the opinion
delivered under
80
Section 8.04 hereof), are in excess of the amount thereof that would then be
required to be deposited to effect an equivalent Legal Defeasance or Covenant
Defeasance.
Section 8.09. Repayment to Company. Any money deposited with the
Trustee or any Paying Agent, or then held by the Company, in trust for the
payment of the principal of, premium and Liquidated Damages, if any, and
interest on any Note and remaining unclaimed for two years after such
principal, and premium and Liquidated Damages, if any, and interest has become
due and payable shall be paid to the Company on its request or (if then held
by the Company) shall be discharged from such trust; and the Holder of such
Note shall thereafter, as a secured creditor, look only to the Company for
payment thereof, and all liability of the Trustee or such Paying Agent with
respect to such trust money, and all liability of the Company as trustee
thereof, shall thereupon cease; provided, however, that the Trustee or such
Paying Agent, before being required to make any such repayment, may at the
expense of the Company cause to be published once, in the New York Times and
The Wall Street Journal (national edition), notice that such money remains
unclaimed and that, after a date specified therein, which shall not be less
than 30 days from the date of such notification or publication, any unclaimed
balance of such money then remaining shall be repaid to the Company.
Section 8.10. Indemnity for Government Securities. The Company shall
pay and shall indemnify the Trustee against any tax, fee or other charge
imposed on or assessed against deposited U.S. Government Obligations or the
principal and interest, if any, received on such U.S. Government Obligations.
Section 8.11. Reinstatement. If the Trustee or Paying Agent is unable
to apply any United States dollars or non-callable Government Securities in
accordance with Section 8.02 or 8.03 hereof, as the case may be, by reason of
any order or judgment of any court or governmental authority enjoining,
restraining or otherwise prohibiting such application, then the Company's
obligations under this Indenture and the Notes shall be revived and reinstated
as though no deposit had occurred pursuant to Section 8.02 or 8.03 hereof
until such time as the Trustee or Paying Agent is permitted to apply all such
money in accordance with Section 8.02 or 8.03 hereof, as the case may be;
provided, however, that, if the Company makes any payment of principal of,
premium, if any, or interest on any Note following the reinstatement of its
obligations, the Company shall be subrogated to the rights of the Holders of
such Notes to receive such payment from the money held by the Trustee or
Paying Agent.
ARTICLE 9
AMENDMENT, SUPPLEMENT AND WAIVER
Section 9.01. Without Consent of Holders of Notes. Notwithstanding
Section 9.02 of this Indenture, without the consent of any Holder of Notes,
the Company, the Guarantors and the Trustee may amend or supplement this
Indenture, or the Notes or the Note Guarantees:
(a) to cure any ambiguity, defect, error or inconsistency;
81
(b) to provide for uncertificated Notes in addition to or in place of
certificated Notes;
(c) to provide for the assumption of the Company's or any Guarantor's
obligations to Holders of Notes in the case of a merger or consolidation
or sale of all or substantially all of the assets of the Company or of
such Guarantor;
(d) to make any change that would provide any additional rights or
benefits to the Holders of Notes or that does not adversely affect the
legal rights under this Indenture of any such Holder;
(e) to comply with requirements of the SEC in order to effect or
maintain the qualification of this Indenture under the Trust Indenture
Act;
(f) to comply with the requirements of Section 4.20;
(g) to evidence and provide for the acceptance of appointment by a
successor Trustee, or
(h) to provide for the issuance of Additional Notes in accordance
with this Indenture.
Upon the request of the Company accompanied by a resolution of its
Board of Directors authorizing the execution of any such amended or
supplemental Indenture, and upon receipt by the Trustee of the documents
described in Section 7.02(b) hereof stating that such amended or supplemental
Indenture complies with this Section 9.01, the Trustee shall join with the
Company in the execution of any amended or supplemental Indenture authorized
or permitted by the terms of this Indenture and to make any further
appropriate agreements and stipulations that may be therein contained, but the
Trustee shall not be obligated to enter into such amended or supplemental
Indenture that affects its own rights, duties or immunities under this
Indenture or otherwise.
Section 9.02. With Consent of Holders of Notes. Except as provided
below in this Section 9.02, this Indenture (including Sections 3.09, 4.10 and
4.14 hereof), the Notes or the Note Guarantees may be amended or supplemented
with the consent of the Holders of at least a majority in principal amount of
the Notes then outstanding (including, without limitation, consents obtained
in connection with a purchase of, or tender offer or exchange offer for,
Notes), and, subject to Sections 6.04 and 6.07 hereof, any existing Default or
Event of Default or compliance with any provision of this Indenture or the
Notes may be waived with the consent of the Holders of a majority in principal
amount of the then outstanding Notes (including, without limitation, consents
obtained in connection with a tender offer or exchange offer for, Notes).
Without the consent of the Holders of at least 75% in principal amount of the
Notes then outstanding voting as a single class (including, without
limitation, consents obtained in connection with a purchase of, or tender
offer or exchange offer for, the Notes), an amendment or waiver may not amend
or modify any of the provisions of this Indenture or the related definitions
affecting the subordination or ranking of the Notes or any Note Guarantee in
any manner adverse to the holders of the Notes or any Note Guarantee. Section
2.08 hereof shall determine which Notes are considered to be "outstanding" for
purposes of this Section 9.02.
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Upon the request of the Company accompanied by a resolution of its
Board of Directors authorizing the execution of any such amended or
supplemental Indenture, and upon the filing with the Trustee of evidence
satisfactory to the Trustee of the consent of the Holders of Notes as
aforesaid, and upon receipt by the Trustee of the documents described in
Section 7.02(b) hereof stating that any such amended or supplemental Indenture
complies with this Section 9.02, the Trustee shall join with the Company in
the execution of such amended or supplemental Indenture unless such amended or
supplemental Indenture directly affects the Trustee's own rights, duties or
immunities under this Indenture or otherwise, in which case the Trustee may in
its discretion, but shall not be obligated to, enter into such amended or
supplemental Indenture.
It shall not be necessary for the consent of the Holders of Notes
under this Section 9.02 to approve the particular form of any proposed
amendment 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 of Notes 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 amended or
supplemental Indenture or waiver.
Subject to Sections 6.04 and 6.07 hereof, the Holders of a majority
in aggregate principal amount of the Notes then outstanding voting as a single
class may waive compliance in a particular instance by the Company with any
provision of this Indenture or the Notes. However, without the consent of each
Holder affected, an amendment or waiver under this Section 9.02 may not (with
respect to any Notes held by a non-consenting Holder):
(a) reduce the principal amount of Notes whose Holders must consent
to an amendment, supplement or waiver;
(b) reduce the principal of or change the fixed maturity of any Note
or alter the provisions, or waive any payment, with respect to the
redemption of the Notes;
(c) reduce the rate of or change the time for payment of interest on
any Note;
(d) waive a Default or Event of Default in the payment of principal
of or premium, if any, or interest or Liquidated Damages, if any, on the
Notes (except a rescission of acceleration of the Notes by the Holders of
at least a majority in aggregate principal amount of the Notes and a
waiver of the payment default that resulted from such acceleration);
(e) make any Note payable in money other than U.S. dollars;
(f) make any change in the provisions of this Indenture relating to
waivers of past Defaults or the rights of Holders of Notes to receive
payments of principal of, or interest or premium or Liquidated Damages, if
any, on the Notes;
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(g) release any Guarantor from any of its obligations under its Note
Guarantee of these Notes or this Indenture, except in accordance with the
terms of this Indenture;
(h) impair the right to institute suit for the enforcement of any
payment on or with respect to the Notes or the Note Guarantees;
(i) amend, change or modify the obligation of the Company to make and
consummate an Asset Sale Offer with respect to any Asset Sale in
accordance with Section 4.10 after the obligation to make such an Asset
Sale Offer has arisen, or the obligation of the Company to make and
consummate a Change of Control Offer in the event of a Change of Control
in accordance with Section 4.14 after such Change of Control has occurred,
including, in each case, amending, changing or modifying any definition
relating thereto;
(j) except as otherwise permitted under Section 5.01 and Article 11,
consent to the assignment or transfer by the Company or any Guarantor of
any of their rights or obligations under this Indenture; or
(k) make any change in Section 6.04 or 6.07 hereof or in the
foregoing amendment and waiver provisions.
Section 9.03. Compliance with Trust Indenture Act. Every amendment or
supplement to this Indenture or the Notes shall be set forth in a amended or
supplemental Indenture that complies with the TIA as then in effect.
Section 9.04. Revocation and Effect of Consents. Until an amendment,
supplement or waiver becomes effective, a consent to it by a Holder of a Note
is a continuing consent by such Holder of a Note and every subsequent Holder
of a Note or portion of a Note that evidences the same debt as the consenting
Holder's Note, even if notation of the consent is not made on any Note.
However, any such Holder of a Note or subsequent Holder of a Note may revoke
the consent as to its Note if the Trustee receives written notice of
revocation before the date the waiver, supplement or amendment becomes
effective. An amendment, supplement or waiver becomes effective in accordance
with its terms and thereafter binds every Holder.
Section 9.05. Notation on or Exchange of Notes. The Trustee may place
an appropriate notation about an amendment, supplement or waiver on any Note
thereafter authenticated. The Company in exchange for all Notes may issue and
the Trustee shall, upon receipt of an Authentication Order, authenticate new
Notes that reflect the amendment, supplement or waiver.
Failure to make the appropriate notation or issue a new Note shall
not affect the validity and effect of such amendment, supplement or waiver.
Section 9.06. Trustee to Sign Amendments, Etc. The Trustee shall sign
any amended or supplemental indenture or Note authorized pursuant to this
Article 9 if the amendment or supplement does not adversely affect the rights,
duties, liabilities or immunities of the Trustee. The Company may not sign an
amendment or supplemental indenture or Note until the Board of Directors
approves it. In executing any amended or supplemental indenture or
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Note, the Trustee shall be entitled to receive and (subject to Section 7.01
hereof) shall be fully protected in relying upon, in addition to the documents
required by Section 11.04 hereof, an Officer's Certificate and an Opinion of
Counsel stating that the execution of such amended or supplemental indenture
is authorized or permitted by this Indenture. The Trustee may, but shall not
be obligated to, execute any such amendment, supplement or waiver which
affects the Trustee's rights, duties or immunities under this Indenture or
otherwise. In signing any amendment, supplement or waiver, the Trustee shall
be entitled to receive an indemnity reasonably satisfactory to it.
ARTICLE 10
SUBORDINATION
Section 10.01. Agreement to Subordinate. The Company agrees, and each
Holder by accepting a Note agrees, that the Indebtedness evidenced by the
Notes is subordinated in right of payment, to the extent and in the manner
provided in this Article 10, to the prior payment in full in cash or Cash
Equivalents of all Senior Debt (whether outstanding on the Issue Date or
hereafter created, incurred, assumed or guaranteed), and that the
subordination is for the benefit of the holders of Senior Debt.
Section 10.02. Liquidation; Dissolution; Bankruptcy. The holders of
Senior Debt of the Company shall be entitled to receive payment in full in
cash or Cash Equivalents of all Obligations due in respect of Senior Debt of
the Company (including interest after the commencement of any bankruptcy
proceeding at the rate specified in the applicable Senior Debt of the Company
whether or not an allowed claim) before the Holders of Notes shall be entitled
to receive any payment with respect to the Notes (except that Holders of Notes
may receive and retain Permitted Junior Securities and payments made from the
trust pursuant to Article 8 hereof), in the event of any distribution to
creditors of the Company in connection with (a) any liquidation or dissolution
of the Company; (b) any bankruptcy, reorganization, insolvency, receivership
or similar proceeding relating to the Company or its property; (c) any
assignment by the Company for the benefit of its creditors; or (d) any
marshaling of the Company's assets and liabilities.
Section 10.03. Default on Designated Senior Debt. The Company shall
not make any payment in respect of the Notes (except in Permitted Junior
Securities or from the trust pursuant to Article 8 hereof) if:
(a) a payment default on Designated Senior Debt of the Company occurs
and is continuing; or
(b) any other default (a "nonpayment default") occurs and is
continuing on any series of Designated Senior Debt of the Company that
permits holders of that series of Designated Senior Debt of the Company to
accelerate its maturity and the Trustee receives a notice of such default
(a "Payment Blockage Notice") from the Company or (i) with respect to
Designated Senior Debt incurred pursuant to the Credit Agreement, the
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agent for the lenders thereunder and (ii) with respect to any other
Designated Senior Debt, the holders of such Designated Senior Debt.
(c) Payments on the Notes may and shall be resumed:
(i) in the case of a payment default on Designated Senior Debt of the
Company, upon the date on which such default is cured or waived; and
(ii) in case of a nonpayment default on Designated Senior Debt of the
Company, the earlier of the date on which such default is cured or waived
or 179 days after the date on which the applicable Payment Blockage Notice
is received, unless the maturity of such Designated Senior Debt of the
Company has been accelerated.
(d) No new Payment Blockage Notice may be delivered unless and until:
(i) 360 days have elapsed since the delivery of the immediately prior
Payment Blockage Notice; and
(ii) all scheduled payments of principal, interest and premium and
Liquidated Damages, if any, on the Notes that have come due have been paid
in full in cash.
(e) No nonpayment default that existed or was continuing on the date
of delivery of any Payment Blockage Notice to the Trustee shall be, or be
made, the basis for a subsequent Payment Blockage Notice.
Section 10.04. Acceleration of Securities. If payment of the Notes is
accelerated because of an Event of Default, the Company and the Trustee shall
promptly notify holders of Senior Debt of the acceleration.
Section 10.05. When Distribution Must Be Paid Over. In the event that
the Trustee or any Holder receives any payment of any Obligations with respect
to the Notes (except in Permitted Junior Securities or from the trust pursuant
to Article 8 hereof) at a time when the payment is prohibited by this Article
and the Trustee or such Holder, as applicable, has actual knowledge that such
payment is prohibited by Article 10 hereof, such payment shall be held by the
Trustee or such Holder, as applicable, in trust for the benefit of the holders
of the Senior Debt of the Company, upon written request of the holders of the
Senior Debt of the Company shall be paid forthwith over and delivered, to the
holders of Senior Debt as their interests may appear or their proper
Representative, for application to the payment of all Obligations with respect
to Senior Debt remaining unpaid to the extent necessary to pay such
Obligations in full in accordance with their terms, after giving effect to any
concurrent payment or distribution to or for the holders of Senior Debt.
With respect to the holders of Senior Debt, the Trustee undertakes to
perform only such obligations on the part of the Trustee as are specifically
set forth in this Article 10, and no implied covenants or obligations with
respect to the holders of Senior Debt shall be read into this Indenture
against the Trustee. The Trustee shall not be deemed to owe any fiduciary duty
to the
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holders of Senior Debt, and shall not be liable to any such holders if
the Trustee shall pay over or distribute to or on behalf of Holders or the
Company or any other Person money or assets to which any holders of Senior
Debt shall be entitled by virtue of this Article 10, except if such payment is
made as a result of the willful misconduct or gross negligence of the Trustee.
Section 10.06. Notice by the Company. The Company shall promptly
notify the Trustee and the Paying Agent in writing of any facts known to the
Company that would cause a payment of any Obligations with respect to the
Notes to violate this Article 10, but failure to give such notice shall not
affect the subordination of the Notes to the Senior Debt as provided in this
Article 10.
Section 10.07. Subrogation. After all Senior Debt is paid in full and
until the Notes are paid in full, Holders of Notes shall be subrogated
(equally and ratably with all other Indebtedness pari passu with the Notes) to
the rights of holders of Senior Debt to receive distributions applicable to
Senior Debt to the extent that distributions otherwise payable to the Holders
of Notes have been applied to the payment of Senior Debt. A distribution made
under this Article 10 to holders of Senior Debt that otherwise would have been
made to Holders of Notes is not, as between the Company and Holders, a payment
by the Company on the Notes.
Section 10.08. Relative Rights. This Article 10 defines the relative
rights of Holders of Notes and holders of Senior Debt. Nothing in this
Indenture shall:
(a) impair, as between the Company and Holders of Notes, the
obligation of the Company, which is absolute and unconditional, to pay
principal of and interest on the Notes in accordance with their terms;
(b) affect the relative rights of Holders of Notes and creditors of
the Company other than their rights in relation to holders of Senior Debt;
or
(c) prevent the Trustee or any Holder of Notes from exercising its
available remedies upon a Default or Event of Default, subject to the
rights of holders and owners of Senior Debt to receive distributions and
payments otherwise payable to Holders of Notes.
If the Company fails because of this Article 10 to pay principal of
or interest on a Note on the due date, the failure is still a Default or Event
of Default.
Section 10.09. Subordination May Not Be Impaired by the Company. No
right of any holder of Senior Debt to enforce the subordination of the
Indebtedness evidenced by the Notes shall be impaired by any act or failure to
act by the Company or any Holder or by the failure of the Company or any
Holder to comply with this Indenture.
Section 10.10. Distribution or Notice to Representative. Whenever a
distribution is to be made or a notice given to holders of Senior Debt, the
distribution may be made and the notice given to their Representative.
Upon any payment or distribution of assets of the Company referred to
in this Article 10, the Trustee and the Holders of Notes shall be entitled to
rely upon any order or decree
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made by any court of competent jurisdiction or upon any certificate of such
Representative or of the liquidating trustee or agent or other Person making
any distribution to the Trustee or to the Holders of Notes for the purpose of
ascertaining the Persons entitled to participate in such distribution, the
holders of the Senior Debt and other Indebtedness of the Company, the amount
thereof or payable thereon, the amount or amounts paid or distributed thereon
and all other facts pertinent thereto or to this Article 10.
Section 10.11. Rights of Trustee and Paying Agent. Notwithstanding
this Article 10 or any other provision of this Indenture, the Trustee shall
not be charged with knowledge of the existence of any facts that would
prohibit the making of any payment or distribution by the Trustee, and the
Trustee and the Paying Agent may continue to make payments on the Notes,
unless the Trustee shall have received at its Corporate Trust Office at least
five Business Days prior to the date of such payment written notice of facts
that would cause the payment of any Obligations with respect to the Notes to
violate this Article 10. Only the Company or a Representative may give the
notice. Nothing in this Article 10 shall impair the claims of, or payments to,
the Trustee under or pursuant to Section 7.07 hereof.
The Trustee in its individual or any other capacity may hold Senior
Debt with the same rights it would have if it were not Trustee. Any Agent may
do the same with like rights.
Section 10.12. Authorization to Effect Subordination. Each Holder of
Notes, by the Holder's acceptance thereof, authorizes and directs the Trustee
on such Holder's behalf to take such action as may be necessary or appropriate
to effectuate the subordination as provided in this Article 10, and appoints
the Trustee to act as such Holder's attorney-in-fact for any and all such
purposes. If the Trustee does not file a proper proof of claim or proof of
debt in the form required in any proceeding referred to in Section 6.09 hereof
at least 30 days before the expiration of the time to file such claim, the
lenders under the Credit Agreement are hereby authorized to file an
appropriate claim for and on behalf of the Holders of the Notes.
ARTICLE 11
NOTE GUARANTEES
Section 11.01. Guarantee. Subject to this Article 11 each of the
Guarantors hereby, jointly and severally, unconditionally guarantees to each
Holder of a Note authenticated and delivered by the Trustee and to the Trustee
and its successors and assigns, irrespective of the validity and enforceability
of this Indenture, the Notes or the obligations of the Company hereunder or
thereunder, that:
(a) (i) the principal of and interest on the Notes will be promptly
paid in full when due, whether at maturity, by acceleration, redemption or
otherwise, and interest on the overdue principal of and interest on the
Notes, if any, if lawful (subject in all cases to any applicable grace
period provided herein), 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 hereof and thereof;
and (ii) in case of any extension of time of payment or renewal of any
Notes or any of such other obligations,
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that 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. Failing payment when due of any
amount so guaranteed or any performance so guaranteed for whatever reason,
the Guarantors shall be jointly and severally obligated to pay the same
immediately. Each Guarantor agrees that this is a guarantee of payment and
not a guarantee of collection.
(b) The Guarantors hereby agree that their obligations hereunder
shall be unconditional, irrespective of the validity, regularity or
enforceability of the Notes or this Indenture, the absence of any action
to enforce the same, any waiver or consent by any Holder of the Notes with
respect to this Indenture, the recovery of any judgment against the
Company, any action to enforce the same or any other circumstance which
might otherwise constitute a legal or equitable discharge or defense of a
Guarantor. Subject to Section 6.06 hereof and to the extent permitted by
applicable law, 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
covenant that this Note Guarantee shall not be discharged except by
complete performance of the obligations contained in the Notes and this
Indenture.
(c) If any Holder or the Trustee is required by any court or
otherwise to return to the Company, the Guarantors or any custodian,
trustee, liquidator or other similar official acting in relation to either
the Company or the Guarantors, any amount paid by either to the Trustee or
such Holder, this Note Guarantee, to the extent theretofore discharged,
shall be reinstated in full force and effect.
(d) Each Guarantor agrees that it shall not be entitled to any right
of subrogation in relation to the Holders in respect of any obligations
guaranteed hereby until payment in full of all obligations guaranteed
hereby. Each Guarantor further agrees that, as between the Guarantors, 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 6 hereof for the purposes of this Note 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 declaration of acceleration of such obligations as
provided in Article 6 hereof, such obligations (whether or not due and
payable) shall forthwith become due and payable by the Guarantors for the
purpose of this Note Guarantee. The Guarantors shall have the right to
seek contribution from any non-paying Guarantor so long as the exercise of
such right does not impair the rights of the Holders under the Note
Guarantee.
Section 11.02. Subordination of Note Guarantee. The Obligations of
each Guarantor under its Note Guarantee pursuant to this Article 11 shall be
subordinated to the Guarantee of any Senior Debt of such Guarantor on the same
basis as the Notes are subordinated to Senior Debt of the Company. For the
purposes of the foregoing sentence, the Trustee and the Holders shall have the
right to receive and/or retain payments by any of the Guarantors only at such
times as they may receive and/or retain payments in respect of the Notes
pursuant to this Indenture, including Article 10 hereof.
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Section 11.03. Limitation on Guarantor Liability. Each Guarantor, and
by its acceptance of Notes, each Holder, hereby confirms that it is the
intention of all such parties that the Note Guarantee of such Guarantor not
constitute a fraudulent transfer or conveyance for purposes of Bankruptcy Law,
the Uniform Fraudulent Conveyance Act, the Uniform Fraudulent Transfer Act or
any similar federal or state law to the extent applicable to any Note
Guarantee. To effectuate the foregoing intention, the Trustee, the Holders and
the Guarantors hereby irrevocably agree that the obligations of such Guarantor
shall, after giving effect to such maximum amount and all other contingent and
fixed liabilities of such Guarantor that are relevant under such laws, and
after giving effect to any collections from, rights to receive contribution
from or payments made by or on behalf of any other Guarantor in respect of the
obligations of such other Guarantor under this Article 11, result in the
obligations of such Guarantor under its Note Guarantee not constituting a
fraudulent transfer or conveyance.
Section 11.04. Execution and Delivery of Note Guarantee. To evidence
its Note Guarantee set forth in Section 11.01, each Guarantor hereby agrees
that a notation of such Note Guarantee substantially in the form included in
Exhibit D attached hereto shall be endorsed by an Officer of such Guarantor on
each Note authenticated and delivered by the Trustee and that this Indenture
shall be executed on behalf of such Guarantor by its President or one of its
Vice Presidents.
Each Guarantor hereby agrees that its Note Guarantee set forth in
Section 11.01 shall remain in full force and effect notwithstanding any
failure to endorse on each Note a notation of such Note Guarantee.
If an Officer whose signature is on this Indenture or on the Note
Guarantee no longer holds that office at the time the Trustee authenticates
the Note on which a Note Guarantee is endorsed, the Note Guarantee shall be
valid nevertheless.
The delivery of any Note by the Trustee, after the authentication
thereof hereunder, shall constitute due delivery of the Note Guarantee set
forth in this Indenture on behalf of the Guarantors.
Section 11.05. Releases Following Sale of Assets. Any Guarantor shall
be released and relieved of any obligations under its Note Guarantee, (a) in
connection with any sale of all of the Capital Stock of that Guarantor
(including by way of merger or consolidation) to a Person that is not (either
before or after giving effect to such transaction) an Affiliate of the
Company, if the sale of all of such Capital Stock of that Guarantor complies
with Section 4.10 hereof, including the application of the Net Proceeds
therefrom; (b) if the Company designated such Subsidiary Guarantor as an
Unrestricted Subsidiary in accordance with this Indenture; or (c) solely in
the case of a Note Guarantee created pursuant to Section 4.20(a), upon the
release or discharge of the Guarantee which resulted in the creation of such
Note Guarantee pursuant to Section 4.20, except a discharge or release by or
as a result of payment under such Guarantee.
Any Guarantor not released from its obligations under its Note
Guarantee shall remain liable for the full amount of principal of and interest
on the Notes and for the other obligations of any Guarantor under this
Indenture as provided in this Article Eleven.
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Section 11.06. Additional Guarantors. The Company covenants and
agrees that it shall cause any Person which becomes obligated to become a
Guarantor, pursuant to the terms of Section 4.20, to execute a supplemental
indenture substantially in the form of Exhibit E hereto and any other
documentation requested by the Trustee satisfactory in form to the Trustee in
accordance with Section 4.20 pursuant to which such Restricted Subsidiary
shall guarantee the obligations of the Company under the Notes and this
Indenture in accordance with this Article Eleven with the same effect and to
the same extent as if such Person had been named herein as a Subsidiary
Guarantor.
Section 11.07. Notation Not Required. Neither the Company nor the
Guarantors shall be required to make a notation on the Notes to reflect any
Note Guarantee or any release, termination or discharge thereof.
Section 11.08. Successors and Assigns. This Article Eleven shall be
binding upon the Guarantors and each of their successors and assigns and shall
inure to the benefit of the successors and assigns of the Trustee and the
Holders and, in the event of any transfer or assignment of rights by any
Holder or the Trustee, the rights and privileges conferred upon that party in
this Indenture and in the Notes shall automatically extend to and be vested in
such transferee or assigns, all subject to the terms and conditions of this
Indenture.
Except as set forth in Article 4 and 5 hereof, and notwithstanding
the provisions of this Section, nothing contained in this Indenture shall
prevent any consolidation or merger of a Guarantor with or into the Company or
another Guarantor, or will prevent the sale or conveyance of the property of a
Guarantor as an entirety or substantially as an entirety to the Company or
another Guarantor.
Section 11.09. No Waiver. Neither a failure nor a delay on the part
of either the Trustee or the Holders in exercising any right, power or
privilege under this Article Eleven shall operate as a waiver thereof, nor
shall a single or partial exercise thereof preclude any other or further
exercise of any right, power or privilege. The rights, remedies and benefits
of the Trustee and the Holders herein expressly specified are cumulative and
are not exclusive of any other rights, remedies or benefits which either may
have under this Article Eleven at law, in equity, by statute or otherwise.
Section 11.10. Modification. No modification, amendment or waiver of
any provision of this Article Eleven, nor the consent to any departure by the
Guarantor therefrom, shall in any event be effective unless the same shall be
in writing and signed by the Trustee, and then such waiver or consent shall be
effective only in the specific instance and for the purpose for which given.
No notice to or demand on the Guarantor in any case shall entitle the
Guarantor to any other or further notice or demand in the same, similar or
other circumstance.
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ARTICLE 12
MISCELLANEOUS
Section 12.01. Trust Indenture Act Controls. This Indenture is
subject to the provisions of the TIA that are required to be a part of this
Indenture, and shall, to the extent applicable, be governed by such
provisions. If any provision of this Indenture modifies any TIA provision that
may be so modified, such TIA provision shall be deemed to apply to this
Indenture as so modified. If any provision of this Indenture excludes any TIA
provision that may be so excluded, such TIA provision shall be excluded from
this Indenture.
The provisions of TIA ss. 310 through 317 that impose duties on
any Person (including the provisions automatically deemed included unless
expressly excluded by this Indenture) are a part of and govern this Indenture,
whether or not physically contained herein.
Section 12.02. Notices. Any notice or communication by the Company,
any Guarantor or the Trustee to the others is duly given if in writing and
delivered in Person or mailed by first class mail (registered or certified,
return receipt requested), telex, telecopier or overnight air courier
guaranteeing next day delivery, to the others' address.
If to the Company and/or any Guarantor:
Rayovac Corporation
6 Concourse Parkway, Suite 3300
Atlanta, GA 30328
Facsimile: 770-829-6298
Attention: General Counsel
with a copy to:
Skadden, Arps, Slate, Meagher & Flom LLP
One Beacon Street
Boston, Massachusetts 02108-3194
Facsimile: 617-573-4822
Attention: Margaret Brown
If to the Trustee:
U.S. Bank National Association
60 Livingston Avenue
St. Paul, MN 55107-2292
Facsimile: 651- 495-8097
Attention: Corporate Trust Department
The Company, any Guarantor or the Trustee, by notice to the others
may designate additional or different addresses for subsequent notices or
communications.
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All notices and communications (other than those sent to Holders)
shall be deemed to have been duly given: (i) at the time delivered by hand, if
personally delivered; (ii) five Business Days after being deposited in the
mail, postage prepaid, if mailed; (iii) when answered back, (iv) if telexed;
when receipt acknowledged, if telecopied; and (v) the next Business Day after
timely delivery to the courier, if sent by overnight air courier guaranteeing
next day delivery.
Any notice or communication to a Holder shall be mailed by first
class mail, certified or registered, return receipt requested, or by overnight
air courier guaranteeing next day delivery to its address shown on the
register kept by the Registrar. Any notice or communication shall also be so
mailed to any Person described in TIA ss. 313(c), to the extent required by
the TIA. Failure to mail a notice or communication to a Holder or any defect
in it shall not affect its sufficiency with respect to other Holders.
If a notice or communication is mailed in the manner provided above
within the time prescribed, it is duly given, whether or not the addressee
receives it.
If the Company mails a notice or communication to Holders, it shall
mail a copy to the Trustee and each Agent at the same time.
Section 12.03. Communication by Holders of Notes with Other Holders
of Notes. Holders may communicate pursuant to TIA ss. 312(b) with other
Holders with respect to their rights under this Indenture or the Notes. The
Company, the Trustee, the Registrar and anyone else shall have the protection
of TIA ss. 312(c).
Section 12.04. 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 (other than in connection with the Exchange Offer
contemplated by Section 2.06(f) or under Section 2.02 hereof unless required
by the TIA), the Company shall furnish to the Trustee:
(a) an Officers' Certificate in form and substance reasonably
satisfactory to the Trustee (which shall include the statements set forth
in Section 12.05 hereof) stating that, in the opinion of the signers, all
conditions precedent and covenants, if any, provided for in this Indenture
relating to the proposed action have been satisfied;
(b) an Opinion of Counsel in form and substance reasonably
satisfactory to the Trustee (which shall include the statements set forth
in Section 12.05 hereof) stating that, in the opinion of such counsel, all
such conditions precedent and covenants have been satisfied; and
(c) where applicable, a certificate or opinion by an independent
certified public accountant satisfactory to the Trustee that complies with
TIA ss. 314(c)(3).
Section 12.05. 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 a certificate provided pursuant to
TIA ss. 314(a)(4)) shall comply with the provisions of TIA ss. 314(e) and
shall include:
93
(a) a statement that the Person making such certificate or opinion
has read such covenant or condition;
(b) 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;
(c) a statement that, in the opinion of such Person, he or she 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 satisfied; and
(d) a statement as to whether or not, in the opinion of such Person,
such condition or covenant has been satisfied.
Section 12.06. Rules by Trustee and Agents. The Trustee may make
reasonable rules for action by or at a meeting of Holders. The Registrar or
Paying Agent may make reasonable rules and set reasonable requirements for its
functions.
Section 12.07. No Personal Liability of Directors, Officers,
Employees and Stockholders. No director, officer, employee, agent, manager,
member, incorporator, stockholder or other equityholder of the Company or any
Guarantor, as such, shall have any liability for any obligations of the
Company or the Guarantors under the Notes, the Exchange Notes, the Note
Guarantees, this Indenture or for any claim based on, in respect of, or by
reason of, such obligations or their creation. Each Holder of Notes by
accepting a Note waives and releases all such liability. The waiver and
release are part of the consideration for issuance of the Notes. Such waiver
may not be effective to waive liabilities under the federal securities laws.
Section 12.08. Governing Law. THE INTERNAL LAW OF THE STATE OF NEW
YORK SHALL GOVERN AND BE USED TO CONSTRUE THIS INDENTURE, THE NOTES AND THE
NOTE GUARANTEES.
Section 12.09. No Adverse Interpretation of Other Agreements. This
Indenture may not be used to interpret any other indenture, loan or debt
agreement of the Company or its Subsidiaries or of any other Person. Any such
indenture, loan or debt agreement may not be used to interpret this Indenture.
All agreements of each Guarantor in this Indenture shall bind its successors.
Section 12.10. Successors. All agreements of the Company in this
Indenture and the Notes shall bind its successors. All agreements of the
Trustee in this Indenture shall bind its successors. All agreements of each
Guarantor in this Indenture shall bind its successors.
Section 12.11. Severability. In case any provision in this Indenture
or in the Notes shall be invalid, illegal or unenforceable, the validity,
legality and enforceability of the remaining provisions shall not in any way
be affected or impaired thereby.
Section 12.12. Counterpart Originals. The parties may sign any number
of copies of this Indenture. Each signed copy shall be an original, but all of
them together represent the same agreement.
94
Section 12.13. Table of Contents, Headings, Etc. The Table of
Contents, Cross-Reference Table and Headings of the Articles and Sections of
this Indenture have been inserted for convenience of reference only, are not
to be considered a part of this Indenture and shall in no way modify or
restrict any of the terms or provisions hereof.
[Signatures on following page]
95
IN WITNESS WHEREOF, the parties have executed this Indenture as of
February 7, 2005.
RAYOVAC CORPORATION
By: /s/ James T. Lucke
--------------------------
Name: James T. Lucke
Title: Secretary
ROV Holding, Inc.
By: /s/ James T. Lucke
--------------------------
Name: James T. Lucke
Title: Secretary
Rovcal, Inc.
By: /s/ James T. Lucke
--------------------------
Name: James T. Lucke
Title: Secretary
96
UNITED INDUSTRIES CORPORATION
By: /s/ Daniel J. Johnston
-------------------------------------
Name: Daniel J. Johnston
Title: Executive Vice President and
Chief Financial Officer
SCHULTZ COMPANY
By: /s/ Daniel J. Johnston
-------------------------------------
Name: Daniel J. Johnston
Title: Vice President and Treasurer
WPC BRANDS, INC.
By: /s/ Daniel J. Johnston
-------------------------------------
Name: Daniel J. Johnston
Title: Vice President and Treasurer
SYLORR PLANT CORP.
By: /s/ Daniel J. Johnston
-------------------------------------
Name: Daniel J. Johnston
Title: Vice President and Treasurer
GROUND ZERO, INC.
By: /s/ Daniel J. Johnston
-------------------------------------
Name: Daniel J. Johnston
Title: Vice President and Treasurer
NU-GRO US HOLDCO CORPORATION
By: /s/ Daniel J. Johnston
-------------------------------------
Name: Daniel J. Johnston
Title: Vice President and Treasurer
97
NU-GRO AMERICA CORP.
By: /s/ Daniel J. Johnston
-------------------------------------
Name: Daniel J. Johnston
Title: Vice President and Treasurer
IB NITROGEN INC.
By: /s/ Daniel J. Johnston
-------------------------------------
Name: Daniel J. Johnston
Title: Vice President and Treasurer
NU-GRO TECHNOLOGIES, INC.
By: /s/ Daniel J. Johnston
-------------------------------------
Name: Daniel J. Johnston
Title: Vice President and Treasurer
UNITED PET GROUP, INC.
By: /s/ Daniel J. Johnston
-------------------------------------
Name: Daniel J. Johnston
Title: Vice President and Treasurer
DB ONLINE, LLC
By: /s/ Daniel J. Johnston
-------------------------------------
Name: Daniel J. Johnston
Title: Vice President and Treasurer
SOUTHERN CALIFORNIA FOAM, INC.
By: /s/ Daniel J. Johnston
-------------------------------------
Name: Daniel J. Johnston
Title: Vice President and Treasurer
98
AQ HOLDINGS, INC.
By: /s/ Daniel J. Johnston
-------------------------------------
Name: Daniel J. Johnston
Title: Vice President and Treasurer
AQUARIA, INC.
By: /s/ Daniel J. Johnston
-------------------------------------
Name: Daniel J. Johnston
Title: Vice President and Treasurer
PERFECTO HOLDING CORP.
By: /s/ Daniel J. Johnston
-------------------------------------
Name: Daniel J. Johnston
Title: Vice President and Treasurer
AQUARIUM SYSTEMS, INC.
By: /s/ Daniel J. Johnston
-------------------------------------
Name: Daniel J. Johnston
Title: Vice President and Treasurer
PERFECTO MANUFACTURING, INC.
By: /s/ Daniel J. Johnston
-------------------------------------
Name: Daniel J. Johnston
Title: Vice President and Treasurer
JUNGLE TALK INTERNATIONAL, INC.
By: /s/ Daniel J. Johnston
-------------------------------------
Name: Daniel J. Johnston
Title: Vice President and Treasurer
99
PETS `N PEOPLE, INC.
By: /s/ Daniel J. Johnston
-------------------------------------
Name: Daniel J. Johnston
Title: Vice President and Treasurer
U.S. BANK NATIONAL
ASSOCIATION, as trustee
By: /s/ Richard H. Prokosch
-------------------------------------
Name: Richard H. Prokosch
Title: Vice President
100
EXHIBIT A
FORM OF NOTE
[Face of Note]
[THIS GLOBAL NOTE IS HELD BY THE DEPOSITARY (AS DEFINED IN THE INDENTURE
GOVERNING THIS NOTE) OR ITS NOMINEE IN CUSTODY FOR THE BENEFIT OF THE
BENEFICIAL OWNERS HEREOF, AND IS NOT TRANSFERABLE TO ANY PERSON UNDER ANY
CIRCUMSTANCES EXCEPT THAT (I) THE TRUSTEE MAY MAKE SUCH NOTATIONS HEREON AS MAY
BE REQUIRED PURSUANT TO SECTION 2.06 OF THE INDENTURE, (II) THIS GLOBAL NOTE
MAY BE EXCHANGED IN WHOLE BUT NOT IN PART PURSUANT TO SECTION 2.06(a) OF THE
INDENTURE, (III) THIS GLOBAL NOTE MAY BE DELIVERED TO THE TRUSTEE FOR
CANCELLATION PURSUANT TO SECTION 2.12 OF THE INDENTURE AND (IV) THIS GLOBAL
NOTE MAY BE TRANSFERRED TO A SUCCESSOR DEPOSITARY WITH THE PRIOR WRITTEN
CONSENT OF THE COMPANY.
THIS NOTE AND THE GUARANTEES ENDORSED HEREON HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY STATE OR
FOREIGN SECURITIES LAWS. NEITHER THIS NOTE NOR THE GUARANTEES ENDORSED HEREON
NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE OFFERED, SOLD, ASSIGNED,
TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF
SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO,
THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT. THE HOLDER OF THIS NOTE
AND THE GUARANTEES ENDORSED HEREON BY ITS ACCEPTANCE HEREOF AGREES TO OFFER,
SELL OR OTHERWISE TRANSFER SUCH SECURITY, PRIOR TO THE DATE WHICH IS TWO YEARS
AFTER THE LATER OF THE ORIGINAL ISSUE DATE HEREOF AND THE LAST DATE ON WHICH
THE COMPANY OR ANY AFFILIATE OF THE COMPANY WAS THE OWNER OF THIS NOTE AND THE
GUARANTEES ENDORSED HEREON (OR ANY PREDECESSOR OF THIS NOTE AND THE GUARANTEES
ENDORSED HEREON OF THIS NOTE) (THE "RESALE RESTRICTION TERMINATION DATE") ONLY
(A) TO THE COMPANY OR ANY SUBSIDIARY THEREOF, (B) PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT, (C) FOR SO LONG AS THE NOTES
ARE ELIGIBLE FOR RESALE PURSUANT TO RULE 144A UNDER THE SECURITIES ACT ("RULE
144A"), TO A PERSON IT REASONABLY BELIEVES IS A "QUALIFIED INSTITUTIONAL BUYER"
AS DEFINED IN RULE 144A THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT
OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS
BEING MADE IN RELIANCE ON RULE 144A, (D) PURSUANT TO OFFERS AND
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SALES TO NON-U.S. PERSONS THAT OCCUR OUTSIDE THE UNITED STATES WITHIN THE
MEANING OF REGULATION S UNDER THE SECURITIES ACT OR (E) PURSUANT TO ANOTHER
AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT,
SUBJECT TO THE COMPANY'S AND THE TRUSTEE'S RIGHT PRIOR TO ANY SUCH OFFER, SALE
OR TRANSFER (i) PURSUANT TO CLAUSE (D) PRIOR TO THE END OF THE 40-DAY
DISTRIBUTION COMPLIANCE PERIOD WITHIN THE MEANING OF REGULATION S UNDER THE
SECURITIES ACT OR PURSUANT TO CLAUSE (E) PRIOR TO THE RESALE RESTRICTION
TERMINATION DATE TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL,
CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO EACH OF THEM, AND (ii)
IN EACH OF THE FOREGOING CASES, TO REQUIRE THAT A CERTIFICATE OF TRANSFER IN
THE FORM APPEARING ON THIS NOTE IS COMPLETED AND DELIVERED BY THE TRANSFEROR TO
THE TRANSFER AGENT. THIS LEGEND SHALL BE REMOVED UPON THE REQUEST OF A HOLDER
AFTER THE RESALE RESTRICTION TERMINATION DATE.]
[If Temporary Regulation S Global Note- THE NOTE IS A TEMPORARY REGULATION S
GLOBAL NOTE WITHIN THE MEANING OF THE INDENTURE REFERRED TO HEREINAFTER. EXCEPT
IN THE CIRCUMSTANCES DESCRIBED IN SECTION 2.06 OF THE INDENTURE, NO TRANSFER OR
EXCHANGE OF AN INTEREST IN THIS TEMPORARY GLOBAL NOTE MAY BE MADE FOR AN
INTEREST IN THE RESTRICTED GLOBAL NOTE. NO EXCHANGE OF AN INTEREST IN THIS
TEMPORARY REGULATION S GLOBAL NOTE MAY BE MADE FOR AN INTEREST IN THE PERMANENT
REGULATION S GLOBAL NOTE EXCEPT (A) ON OR AFTER THE TERMINATION OF THE
DISTRIBUTION COMPLIANCE PERIOD (AS DEFINED IN REGULATION S UNDER THE SECURITIES
ACT OF 1933, AS AMENDED (THE "SECURITIES ACT")) AND (B) UPON DELIVERY OF THE
OWNER SECURITIES CERTIFICATION AND THE TRANSFEREE SECURITIES CERTIFICATION
RELATING TO SUCH INTEREST IN ACCORDANCE WITH THE TERMS OF THE INDENTURE.
UNTIL 40 DAYS AFTER THE COMMENCEMENT OF THE OFFERING OF THE NOTES, AN OFFER OR
SALE OF THE NOTES WITHIN THE UNITED STATES BY A DEALER (AS DEFINED IN THE
SECURITIES ACT OF 1933, AS AMENDED) MAY VIOLATE THE REGISTRATION REQUIREMENTS
OF THE SECURITIES ACT OF 1933, AS AMENDED IF SUCH OFFER OR SALE IS MADE
OTHERWISE THAN IN ACCORDANCE WITH RULE 144A UNDER THE SECURITIES ACT OF 1933,
AS AMENDED.]
A-2
[If Restricted Global Note - CUSIP Number 755081 AE6/ISIN Number US755081AE62]
[If Temporary Regulation S Global Note or Regulation S Global Note - CUSIP
Number U75320 AB4/ISIN Number USU75320AB47]
No.
---
**$_________**
RAYOVAC CORPORATION
7 3/8% Senior Subordinated Notes due 2015
Rayovac Corporation (the "Company"), for value received, promises to
pay to CEDE & Co., or its registered assigns, the principal sum of [Amount of
Note] $______________ Dollars on February 1, 2015.
Interest Payment Dates: February 1 and August 1 of each year, starting on
August 1, 2005.
Record Dates: January 15 and July 15.
Reference is hereby made to the further provisions of this Note set
forth on the reverse hereof, which further provisions shall for all purposes
have the same effect as if set forth at this place.
A-3
IN WITNESS WHEREOF, the Company has caused this Note to be signed manually or
by facsimile by its duly authorized officers.
RAYOVAC CORPORATION
By:
-------------------------------
Name:
Title:
(Trustee's Certificate of Authentication)
This is one of the 7 3/8% Senior Subordinated Notes due 2015 referred to in
the within-mentioned Indenture.
Dated:
U.S. BANK NATIONAL ASSOCIATION, as Trustee
By:
-------------------------------
Authorized Signatory
A-4
[Reverse Side of Note]
RAYOVAC CORPORATION
7 3/8% Senior Subordinated Notes due 2015
Capitalized terms used herein shall have the meanings
assigned to them in the Indenture referred to below unless otherwise indicated.
1. Interest. The Company promises to pay interest on the principal
amount and premium, if any, of this Note at 7 3/8% per annum from the date
hereof until Maturity and shall pay the Liquidated Damages, if any, payable
pursuant to Section 5 of the Registration Rights Agreement referred to below.
The Company shall pay interest and Liquidated Damages, if any, semi-annually on
February 1 and August 1 of each year, or if any such day is not a Business Day,
on the next succeeding Business Day (each an "Interest Payment Date"). Interest
on the Notes shall accrue from the most recent date to which interest has been
paid or, if no interest has been paid, from the date of issuance; provided that
if there is no existing Default in the payment of interest, and if this Note is
authenticated between a Record Date referred to on the face hereof and the next
succeeding Interest Payment Date, interest shall accrue from such next
succeeding Interest Payment Date; provided further that the first Interest
Payment Date shall be August 1, 2005. The Company shall pay interest (including
post-petition interest in any proceeding under any Bankruptcy Law) on overdue
principal and premium, if any, from time to time on demand at a rate that is 1%
per annum in excess of the rate then in effect; it shall pay interest
(including post-petition interest in any proceeding under any Bankruptcy Law)
on overdue installments of interest and Liquidated Damages (without regard to
any applicable grace periods) from time to time on demand at the same rate to
the extent lawful. Interest shall be computed on the basis of a 360-day year of
twelve 30-day months.
2. Method of Payment. The Company shall pay interest on the Notes
(except defaulted interest) and Liquidated Damages, if any, to the Persons who
are registered Holders of Notes at the close of business on the Record Date
immediately preceding the Interest Payment Date, even if such Notes are
canceled after such Record Date and on or before such Interest Payment Date,
except as provided in Section 2.13 of the Indenture with respect to defaulted
interest. The Notes shall be payable as to principal, premium, if any, and
Liquidated Damages, if any, and interest at the office or agency of the Company
maintained for such purpose within or without the City and State of New York,
or, at the option of the Company, payment of interest and Liquidated Damages,
if any, may be made by check mailed to the Holders at their addresses set forth
in the register of Holders, and provided that payment by wire transfer of
immediately available funds shall be required with respect to principal of and
interest, premium and Liquidated Damages on, all Global Notes and all other
Notes the Holders of which shall have provided wire transfer instructions to
the Company or the Paying Agent. Such payment shall be in such coin or currency
of the United States of America as at the time of payment is legal tender for
payment of public and private debts.
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3. Paying Agent and Registrar. Initially, U.S. Bank National
Association, the Trustee under the Indenture, shall act as Paying Agent and
Registrar. The Company may change any Paying Agent or Registrar without notice
to any Holder. The Company or any of its Subsidiaries may act in any such
capacity.
4. Indenture. The Company issued the Notes under an Indenture dated
as of February 7, 2005 (the "Indenture") among the Company, the Guarantors and
the Trustee. The terms of the Notes include those stated in the Indenture and
those made part of the Indenture by reference to the Trust Indenture Act of
1939, as amended. The Notes are subject to all such terms, and Holders are
referred to the Indenture and such Act for a statement of such terms. To the
extent any provision of this Note conflicts with the express provisions of the
Indenture, the provisions of the Indenture shall govern and be controlling.
The Indenture pursuant to which this Note is issued provides that an unlimited
aggregate principal amount of Additional Notes may be issued thereunder.
5. Optional Redemption. (a) Except as set forth in paragraph 5 (b)
below, the Notes shall not be redeemable at the Company's option prior to
February 1, 2010. Thereafter, the Company may redeem all or a part of these
Notes, upon not less than 30 nor more than 60 days' notice, at the redemption
prices (expressed as percentages of principal amount) set forth below plus
accrued and unpaid interest and Liquidated Damages, if any, thereon to the
applicable redemption date, if redeemed during the twelve-month period
beginning on February 1 of the years indicated below:
Year Percentage
---- ----------
2010............................................... 103.688%
2011............................................... 102.458%
2012............................................... 101.229%
2013 and thereafter................................ 100.000%
(b) At any time prior to February 1, 2008, the Company may on one
or more occasions redeem up to 35% of the aggregate principal amount of
Notes at a redemption price of 107.375% of the principal amount thereof,
plus accrued and unpaid interest and Liquidated Damages thereon, if any,
to the redemption date, with the net cash proceeds of one or more Equity
Offerings of the Company; provided that at least 65% of the aggregate
principal amount of Notes remains outstanding immediately after the
occurrence of such redemption (excluding Notes held by the Company or its
Subsidiaries); and such redemption shall occur within 45 days of the date
of the closing of such Equity Offering.
6. Repurchase at Option of Holder. (a) If a Change of Control
occurs, each Holder of Notes shall have the right to require the Company to
repurchase all or any part (equal to $1,000 or an integral multiple thereof)
of such Holder's Notes pursuant to the offer described below (the "Change of
Control Offer") at an offer price in cash equal to 101% of the aggregate
principal amount of Notes repurchased plus accrued and unpaid interest and
Liquidated Damages, if any, thereon to the date of purchase (the "Change of
Control Payment"). Within 30 days following any Change of Control, the
Company shall mail a notice to each Holder describing the transaction or
transactions that constitute the Change of Control and which shall
A-6
be no earlier than 30 days and no later than 60 days from the date such
notice is mailed (the "Change of Control Payment Date"), pursuant to the
procedures required by the Indenture and described in such notice;
(b) Within 360 days after the receipt of any Net Proceeds from an
Asset Sale, the Company may apply such Net Proceeds at its option: (i) to
repay Senior Debt and, if the Senior Debt being repaid is revolving credit
Indebtedness, to correspondingly reduce commitments with respect thereto; or
(ii) to purchase Replacement Assets or make a capital expenditure in or that
is used or useful in a Permitted Business. Pending the final applications of
any such Net Proceeds, the Company may temporarily reduce revolving credit
borrowings or otherwise invest such Net Proceeds in any manner that is not
prohibited by the Indenture. Any Net Proceeds from Asset Sales that are not
applied or invested as provided in the preceding paragraph will constitute
"Excess Proceeds." Within 10 days after the aggregate amount of Excess
Proceeds exceeds $20.0 million, the Company will make an offer (an "Asset Sale
Offer") to all Holders of Notes and all holders of other Indebtedness that is
pari passu with the Notes or any Note Guarantee containing provisions similar
to those set forth in the Indenture with respect to offers to purchase with
the proceeds of sales of assets to purchase the maximum principal amount of
Notes and such other pari passu Indebtedness that may be purchased out of the
Excess Proceeds at an offer price in cash equal to 100% of the principal
amount thereof of the Notes and such other pari passu Indebtedness plus
accrued and unpaid interest and Liquidated Damages, if any, to the date of
purchase, and will be payable in cash. If any Excess Proceeds remain after
consummation of an Asset Sale Offer, the Company may use such Excess Proceeds
for any purpose not otherwise prohibited by the Indenture. If the aggregate
principal amount of Notes and such other pari passu Indebtedness tendered into
such Asset Sale Offer exceeds the amount of Excess Proceeds, the Notes and
such other pari passu Indebtedness to be purchased on a pro rata basis based
on the principal amount of Notes and such other pari passu Indebtedness
tendered. Upon completion of each Asset Sale Offer, the amount of Excess
Proceeds shall be reset at zero.
7. Selection and Notice of Redemption If less than all of the Notes
are to be redeemed or purchased in an offer to purchase at any time, the
Trustee shall select the Notes to be redeemed or purchased among the Holders
in compliance with the requirements of the principal national securities
exchange, if any, on which the Notes are listed, or, if the Notes are not so
listed, on a pro rata basis, by lot or in accordance with any other method
the Trustee shall deem fair and appropriate. At least 30 days but not more
than 60 days before a redemption date, the Company shall mail or cause to be
mailed, by first class mail, a notice of redemption to each Holder whose
Notes are to be redeemed at its registered address. The notice shall
identify the Notes to be redeemed and shall state:(i) the redemption date;
(ii) the redemption price; (iii) if any Note is being redeemed in part, the
portion of the principal amount of such Note to be redeemed and that, after
the redemption date upon surrender of such Note, a new Note or Notes in
principal amount equal to the unredeemed portion of the original Note shall
be issued in the name of the Holder thereof upon cancellation of the
original Note; (iv) the name and address of the Paying Agent; (v) that Notes
called for redemption must be surrendered to the Paying Agent to collect the
redemption price and become due on the date fixed for redemption; (vi) that,
unless the Company defaults in making such redemption payment, interest on
Notes called for redemption ceases to accrue on and after the redemption
date; (vii) the paragraph of the Notes and/or Section of the Indenture
pursuant to which the Notes called for redemption are being redeemed; and
A-7
(viii) that no representation is made as to the correctness or accuracy of
the CUSIP number, if any, listed in such notice or printed on the Notes.
8. Denominations, Transfer, Exchange. The Notes are in registered
form without coupons in denominations of $1,000 and integral multiples of
$1,000. The transfer of Notes may be registered and Notes may be exchanged as
provided in the Indenture. The Registrar and the Trustee may require a Holder,
among other things, to furnish appropriate endorsements and transfer documents
and the Company may require a Holder to pay any taxes and fees required by law
or permitted by the Indenture. The Company need not exchange or register the
transfer of any Note or portion of a Note selected for redemption, except for
the unredeemed portion of any Note being redeemed in part. Also, the Company
need not exchange or register the transfer of any Notes for a period of 15
days before a selection of Notes to be redeemed or during the period between a
record date and the corresponding Interest Payment Date.
9. Persons Deemed Owners. The registered Holder of a Note will be
treated as its owner for all purposes.
10. Amendment, Supplement and Waiver. Subject to certain exceptions,
the Indenture, the Note Guarantees, or the Notes may be amended or
supplemented with the consent of the Holders of at least a majority in
principal amount of the then outstanding Notes and Additional Notes, if any,
voting as a single class, and any existing default or compliance with any
provision of the Indenture, the Note Guarantees, or the Notes may be waived
with the consent of the Holders of a majority in principal amount of the then
outstanding Notes, if any, voting as a single class. Without the consent of
the Holders of at least 75% in principal amount of the Notes then outstanding
voting as a single class (including, without limitation, consents obtained in
connection with a purchase of, or tender offer or exchange offer for, the
Notes), an amendment or waiver may not amend or modify any of the provisions
of the Indenture or the related definitions affecting the subordination or
ranking of the Notes or any Note Guarantee in any manner adverse to the
holders of the Notes or any Note Guarantee. Without the consent of any Holder
of a Note, the Indenture, the Note Guarantees, or the Notes may be amended or
supplemented to cure any ambiguity, defect or inconsistency, to provide for
uncertificated Notes in addition to or in place of certificated Notes, to
provide for the assumption of the Company's obligations to Holders of the
Notes in case of a merger or consolidation or sale of all or substantially all
of the assets of the Company, to make any change that would provide any
additional rights or benefits to the Holders of the Notes or that does not
adversely affect the legal rights under the Indenture of any such Holder, to
comply with the requirements of the SEC in order to effect or maintain the
qualification of the Indenture under the Trust Indenture Act or to allow any
Subsidiary to guarantee the Notes, to provide for the issuance of Additional
Notes in accordance with the limitations set forth in the Indenture, or to
allow any Guarantor to execute a supplemental indenture to the Indenture with
respect to the Notes.
11. Defaults and Remedies. In the case of an Event of Default arising
from certain events of bankruptcy or insolvency, with respect to the Company
or any of its Restricted Subsidiaries that is a Significant Subsidiary, all
outstanding Notes will become due and payable immediately without further
action or notice. If any other Event of Default occurs and is continuing, the
Trustee or the Holders of at least 25% in principal amount of the Notes may
A-8
declare all the Notes to be due and payable immediately by notice in writing
to the Company specifying the Event of Default. Holders of the Notes may not
enforce the Indenture or the Notes except as provided in the Indenture.
Subject to certain limitations, Holders of a majority in principal amount of
the then outstanding Notes may direct the Trustee in its exercise of any trust
or power. The Trustee may withhold from Holders of the Notes notice of any
continuing Default or Event of Default (except a Default or Event of Default
relating to the payment of principal, premium, if any, or interest) if it
determines that withholding notice is in their interest. The Holders of a
majority in aggregate principal amount of the Notes then outstanding by notice
to the Trustee may on behalf of the Holders of all of the Notes waive any
existing Default or Event of Default and its consequences under the Indenture
except a continuing Default or Event of Default in the payment of interest,
premium or Liquidated Damages on, or the principal of, the Notes.
In the case of any Event of Default occurring by reason of any
willful action or inaction taken or not taken by or on behalf of the Company
with the intention of avoiding payment of the premium that the Company would
have had to pay if the Company then had elected to redeem the Notes pursuant
to Section 3.07 of the Indenture concerning optional redemption, an equivalent
premium shall also become and be immediately due and payable to the extent
permitted by law upon the acceleration of the Notes.
12. Trustee Dealings with Company. The Trustee, in its individual or
any other capacity, may make loans to, accept deposits from, and perform
services for the Company or its Affiliates, and may otherwise deal with the
Company or its Affiliates, as if it were not the Trustee.
13. No Recourse Against Others. No past, present or future director,
officer, employee, incorporator, stockholder or agent of the Company or any
Guarantor, as such, shall have any liability for any obligations of the
Company or any Guarantor under the Notes, any Note Guarantees, the Indenture
or for any claim based on, in respect of, or by reason of, such obligations or
their creation. Each Holder of the Notes by accepting a Note waives and
releases all such liability. The waiver and release are part of the
consideration for issuance of the Notes. Such waiver may not be effective to
waive liabilities under the federal securities laws.
14. Authentication. This Note shall not be valid until authenticated
by the manual signature of the Trustee or an authenticating agent.
15. Additional Rights of Holders of Restricted Global Notes and
Restricted Certificated Notes. In addition to the rights provided to Holders
of Notes under the Indenture, Holders of Restricted Global Notes and
Restricted Definitive Notes shall have all the rights set forth in the
Registration Rights Agreement, dated as of February 7, 2005, among the
Company, the Guarantors and the parties named on the signature pages thereof
or, in the case of Additional Notes, Holders of Restricted Global Notes and
Restricted Definitive Notes shall have the rights set forth in one or more
registration rights agreements, if any, among the Company, the Guarantors and
the other parties thereto, relating to rights given by the Company to the
purchasers of Additional Notes (collectively, the "Registration Rights
Agreement").
A-9
16. 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 Notes and the Trustee may use CUSIP
numbers in notices of redemption as a convenience to Holders. No
representation is made as to the accuracy of such numbers either as printed on
the Notes or as contained in any notice of redemption and reliance may be
placed only on the other identification numbers placed thereon.
The Company shall furnish to any Holder upon written request and without charge
a copy of the Indenture and/or the Registration Rights Agreement. Requests may
be made to:
If to the Company and/or any Guarantor:
Rayovac Corporation
6 Concourse Parkway, Suite 3300
Atlanta, GA 30328
Facsimile: 770-829-6298
Attention: General Counsel
with a copy to:
Skadden, Arps, Slate, Meagher & Flom LLP
One Beacon Street
Boston, Massachusetts 02108-3194
Facsimile: 617-573-4822
Attention: Margaret Brown
A-10
ASSIGNMENT FORM
To assign this Note, fill in the form below: (I) or (we) assign and transfer
this Note to
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
(Insert assignee's legal name)
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
(Insert assignee's soc. sec. or tax I.D. no.)
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
(Print or type assignee's name, address and zip code)
- -------------------------------------------------------------------------------
and irrevocably appoint ______________________________________________________
to transfer this Note on the books of the Company. The agent may substitute
another to act for him.
Date: _______________
Your Signature:_______________________
(Sign exactly as your name appears on
the face of this Note)
Signature Guarantee.*
* Participant is recognized Signature Guarantee Medallion Program (or other
signature guarantor acceptable to the Trustee).
A-11
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Note purchased by the Company
pursuant to Section 4.10 or 4.14 of the Indenture, check the box below:
[ ] [ ]
Section 4.10 Section 4.14
If you want to elect to have only part of the Note purchased by the
Company pursuant to Section 4.10 or Section 4.14 of the Indenture, state the
amount you elect to have purchased: $________
Date: _______________ Your Signature:
------------------
(Sign exactly as your name
appears on the Note)
Tax Identification No:________
Signature Guarantee.*
* Participant is recognized Signature Guarantee Medallion Program (or other
signature guarantor acceptable to the Trustee).
A-12
SCHEDULE OF EXCHANGES OF GLOBAL NOTE
The following exchanges of a part of this Global Note for an
interest in another Global Note or of another Global Note for an interest in
this Global Note, have been made:
Principal Amount Signature of
Amount of Decrease in Amount of Increase in of this Global Note Authorized Officer
Principal Principal Following such of Trustee or
Date of Exchange of this Global Note of this Global Note decrease (or increase) Note Custodian
- ---------------- ------------------- ------------------- ---------------------- --------------
A-13
EXHIBIT B
FORM OF CERTIFICATE OF TRANSFER
Re: 7 3/8% Senior Subordinated Notes due 2015
Reference is hereby made to the Indenture, dated as of February 7,
2005 (the "Indenture"), between Rayovac Corporation, as issuer (the "Company"),
the Guarantors, as defined therein (the "Guarantors") and U.S. Bank National
Association, as trustee. Capitalized terms used but not defined herein shall
have the meanings given to them in the Indenture.
______________, (the "Transferor") owns and proposes to transfer the
Note[s] or interest in such Note[s] specified in Annex A hereto, in the
principal amount of $___________ in such Note[s] or interests (the "Transfer"),
to __________ (the "Transferee"), as further specified in Annex A hereto. In
connection with the Transfer, the Transferor hereby certifies that:
[CHECK ALL THAT APPLY]
[ ] 1. CHECK IF TRANSFEREE SHALL TAKE DELIVERY OF A BENEFICIAL
INTEREST IN THE 144A GLOBAL NOTE OR A CERTIFICATED NOTE PURSUANT TO RULE 144A.
The Transfer is being effected pursuant to and in accordance with Rule 144A
under the United States Securities Act of 1933, as amended (the "Securities
Act"), and, accordingly, the Transferor hereby further certifies that the
beneficial interest or Certificated Note is being transferred to a Person that
the Transferor reasonably believed and believes is purchasing the beneficial
interest or Certificated Note for its own account, or for one or more accounts
with respect to which such Person exercises sole investment discretion, and
such Person and each such account is a "qualified institutional buyer" within
the meaning of Rule 144A in a transaction meeting the requirements of Rule 144A
and such Transfer is in compliance with any applicable blue sky securities laws
of any state of the United States. Upon consummation of the proposed Transfer
in accordance with the terms of the Indenture, the transferred beneficial
interest or Certificated Note shall be subject to the restrictions on transfer
enumerated in the Private Placement Legend printed on the 144A Global Note
and/or the Certificated Note and in the Indenture and the Securities Act.
[ ] 2. CHECK IF TRANSFEREE SHALL TAKE DELIVERY OF A BENEFICIAL INTEREST IN
THE REGULATION S GLOBAL NOTE OR A CERTIFICATED NOTE PURSUANT TO REGULATION S.
The Transfer is being effected pursuant to and in accordance with Rule 903 or
Rule 904 under the Securities Act and, accordingly, the Transferor hereby
further certifies that (a) the Transfer is not being made to a person in the
United States and (x) at the time the buy order was originated, the Transferee
was outside the United States or such Transferor and any Person acting on its
behalf reasonably believed and believes that the Transferee was outside the
United States or (y) the transaction was executed in, on or through the
facilities of a designated offshore securities market and neither such
Transferor nor any Person acting on its behalf knows that the transaction was
prearranged with a buyer in the United States, (b) no directed selling efforts
have been made in contravention of the requirements of Rule 903(b) or Rule
904(b) of Regulation S under the Securities Act, (c) the transaction is not
part of a plan or scheme to evade the registration requirements of the
Securities Act and (d) if the proposed transfer is being made prior to the
expiration of the Restricted Period, the transfer is not being made to a U.S.
Person or for the account or benefit of a
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U.S. Person (other than an Initial Purchaser). Upon consummation of
the proposed transfer in accordance with the terms of the Indenture, the
transferred beneficial interest or Certificated Note shall be subject to the
restrictions on Transfer enumerated in the Private Placement Legend printed on
the Regulation S Global Note and/or the Certificated Note and in the Indenture
and the Securities Act.
[ ] 3. CHECK AND COMPLETE IF TRANSFEREE SHALL TAKE DELIVERY OF A
BENEFICIAL INTEREST IN A CERTIFICATED NOTE PURSUANT TO ANY PROVISION OF THE
SECURITIES ACT OTHER THAN RULE 144A OR REGULATION S. The Transfer is being
effected in compliance with the transfer restrictions applicable to beneficial
interests in Restricted Global Notes and Restricted Certificated Notes and
pursuant to and in accordance with the Securities Act and any applicable blue
sky securities laws of any state of the United States, and accordingly the
Transferor hereby further certifies that (check one):
[ ] (a) such Transfer is being effected pursuant to and in accordance with
Rule 144 under the Securities Act;
or
[ ] (b) such Transfer is being effected to the Company or a subsidiary
thereof;
or
[ ] (c) such Transfer is being effected pursuant to an effective
registration statement under the Securities Act and in compliance with the
prospectus delivery requirements of the Securities Act.
[ ] 4. CHECK IF TRANSFEREE SHALL TAKE DELIVERY OF A BENEFICIAL INTEREST IN
AN UNRESTRICTED GLOBAL NOTE OR OF AN UNRESTRICTED CERTIFICATED NOTE.
[ ] (a) CHECK IF TRANSFER IS PURSUANT TO RULE 144. (a) The Transfer is
being effected pursuant to and in accordance with Rule 144 under the Securities
Act and in compliance with the transfer restrictions contained in the Indenture
and any applicable blue sky securities laws of any state of the United States
and (b) the restrictions on transfer contained in the Indenture and the Private
Placement Legend are not required in order to maintain compliance with the
Securities Act. Upon consummation of the proposed Transfer in accordance with
the terms of the Indenture, the transferred beneficial interest or Certificated
Note shall no longer be subject to the restrictions on transfer enumerated in
the Private Placement Legend printed on the Restricted Global Notes, on
Restricted Certificated Notes and in the Indenture.
[ ] (b) CHECK IF TRANSFER IS PURSUANT TO REGULATION S. (a) The
Transfer is being effected pursuant to and in accordance with Rule 903 or
Rule 904 under the Securities Act and in compliance with the transfer
restrictions contained in the Indenture and any applicable blue sky
securities laws of any state of the United States and (b) the restrictions on
transfer contained in the Indenture and the Private Placement Legend are not
required in order to maintain compliance with the Securities Act. Upon
consummation of the proposed Transfer in accordance with the terms of the
Indenture, the transferred beneficial interest or Certificated Note shall no
longer be subject to the restrictions on transfer enumerated in the Private
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Placement Legend printed on the Restricted Global Notes, on Restricted
Certificated Notes and in the Indenture.
[ ] (c) CHECK IF TRANSFER IS PURSUANT TO OTHER EXEMPTION. (a) The Transfer
is being effected pursuant to and in compliance with an exemption from the
registration requirements of the Securities Act other than Rule 144, Rule 903
or Rule 904 and in compliance with the transfer restrictions contained in the
Indenture and any applicable blue sky securities laws of any State of the
United States and (b) the restrictions on transfer contained in the Indenture
and the Private Placement Legend are not required in order to maintain
compliance with the Securities Act. Upon consummation of the proposed Transfer
in accordance with the terms of the Indenture, the transferred beneficial
interest or Certificated Note shall not be subject to the restrictions on
transfer enumerated in the Private Placement Legend printed on the Restricted
Global Notes or Restricted Certificated Notes and in the Indenture.
This certificate and the statements contained herein are made for your
benefit and the benefit of the Company.
[Insert Name of Transferor]
By:
-------------------------------
Name:
Title:
Dated:_____________,____
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ANNEX A TO CERTIFICATE OF TRANSFER
1. The Transferor owns and proposes to transfer the following:
[CHECK ONE OF (a) OR (b)]
[ ] (a) a beneficial interest in the:
(i) 144A Global Note (CUSIP ); or
(ii) Regulation S Global Note (CUSIP ); or
[ ] (b) a Restricted Certificated Note.
(q) After the Transfer the Transferee shall hold:
[CHECK ONE]
[ ] (c) a beneficial interest in the:
(i) 144A Global Note (CUSIP ); or
(ii) Regulation S Global Note (CUSIP ); or
(iii) Unrestricted Global Note (CUSIP ); or
(d) a Restricted Certificated Note; or
(e) an Unrestricted Certificated Note,
in accordance with the terms of the Indenture.
B-4
EXHIBIT C
FORM OF CERTIFICATE OF EXCHANGE
Re: 7 3/8% Senior Subordinated Notes due 2015
(CUSIP______________)
Reference is hereby made to the Indenture, dated as of February 7,
2005 (the "Indenture"), between Rayovac Corporation, as issuer (the "Company"),
the Guarantors named therein (the "Guarantors") and U.S. Bank National
Association, as trustee. Capitalized terms used but not defined herein shall
have the meanings given to them in the Indenture.
____________, (the "Owner") owns and proposes to exchange the
Note[s] or interest in such Note[s] specified herein, in the principal amount
of $____________ in such Note[s] or interests (the "Exchange"). In connection
with the Exchange, the Owner hereby certifies that:
1. EXCHANGE OF RESTRICTED CERTIFICATED NOTES OR BENEFICIAL
INTERESTS IN A RESTRICTED GLOBAL NOTE FOR UNRESTRICTED CERTIFICATED NOTES OR
BENEFICIAL INTERESTS IN AN UNRESTRICTED GLOBAL NOTE.
[ ] (a) CHECK IF EXCHANGE IS FROM BENEFICIAL INTEREST IN A RESTRICTED
GLOBAL NOTE TO BENEFICIAL INTEREST IN AN UNRESTRICTED GLOBAL NOTE. In
connection with the Exchange of the Owner's beneficial interest in a Restricted
Global Note for a beneficial interest in an Unrestricted Global Note in an
equal principal amount, the Owner hereby certifies (i) the beneficial interest
is being acquired for the Owner's own account without transfer, (ii) such
Exchange has been effected in compliance with the transfer restrictions
applicable to the Global Notes and pursuant to and in accordance with the
United States Securities Act of 1933, as amended (the "Securities Act"), (iii)
the restrictions on transfer contained in the Indenture and the Private
Placement Legend are not required in order to maintain compliance with the
Securities Act and (iv) the beneficial interest in an Unrestricted Global Note
is being acquired in compliance with any applicable blue sky securities laws of
any state of the United States.
[ ] (b) CHECK IF EXCHANGE IS FROM BENEFICIAL INTEREST IN A RESTRICTED
GLOBAL NOTE TO UNRESTRICTED CERTIFICATED NOTE. In connection with the Exchange
of the Owner's beneficial interest in a Restricted Global Note for an
Unrestricted Certificated Note, the Owner hereby certifies (i) the Certificated
Note is being acquired for the Owner's own account without transfer, (ii) such
Exchange has been effected in compliance with the transfer restrictions
applicable to the Restricted Global Notes and pursuant to and in accordance
with the Securities Act, (iii) the restrictions on transfer contained in the
Indenture and the Private Placement Legend are not required in order to
maintain compliance with the Securities Act and (iv) the Certificated Note is
being acquired in compliance with any applicable blue sky securities laws of
any state of the United States.
[ ] (c) CHECK IF EXCHANGE IS FROM RESTRICTED CERTIFICATED NOTE TO
BENEFICIAL INTEREST IN AN UNRESTRICTED GLOBAL NOTE. In connection with the
Owner's Exchange of a
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Restricted Certificated Note for a beneficial interest in an Unrestricted
Global Note, the Owner hereby certifies (i) the beneficial interest is being
acquired for the Owner's own account without transfer, (ii) such Exchange has
been effected in compliance with the transfer restrictions applicable to
Restricted Certificated Notes and pursuant to and in accordance with the
Securities Act, (iii) the restrictions on transfer contained in the Indenture
and the Private Placement Legend are not required in order to maintain
compliance with the Securities Act and (iv) the beneficial interest is being
acquired in compliance with any applicable blue sky securities laws of any
state of the United States.
[ ] (d) CHECK IF EXCHANGE IS FROM RESTRICTED CERTIFICATED NOTE TO
UNRESTRICTED CERTIFICATED NOTE. In connection with the Owner's Exchange of a
Restricted Certificated Note for an Unrestricted Certificated Note, the Owner
hereby certifies (i) the Unrestricted Certificated Note is being acquired for
the Owner's own account without transfer, (ii) such Exchange has been effected
in compliance with the transfer restrictions applicable to Restricted
Certificated Notes and pursuant to and in accordance with the Securities Act,
(iii) the restrictions on transfer contained in the Indenture and the Private
Placement Legend are not required in order to maintain compliance with the
Securities Act and (iv) the Unrestricted Certificated Note is being acquired in
compliance with any applicable blue sky securities laws of any state of the
United States.
[ ] 2. EXCHANGE OF RESTRICTED CERTIFICATED NOTES OR BENEFICIAL
INTERESTS IN RESTRICTED GLOBAL NOTES FOR RESTRICTED CERTIFICATED NOTES OR
BENEFICIAL INTERESTS IN RESTRICTED GLOBAL NOTES.
[ ] (a) CHECK IF EXCHANGE IS FROM BENEFICIAL INTEREST IN A RESTRICTED
GLOBAL NOTE TO RESTRICTED CERTIFICATED NOTE. In connection with the Exchange of
the Owner's beneficial interest in a Restricted Global Note for a Restricted
Certificated Note with an equal principal amount, the Owner hereby certifies
that the Restricted Certificated Note is being acquired for the Owner's own
account without transfer. Upon consummation of the proposed Exchange in
accordance with the terms of the Indenture, the Restricted Certificated Note
issued shall continue to be subject to the restrictions on transfer enumerated
in the Private Placement Legend printed on the Restricted Certificated Note and
in the Indenture and the Securities Act.
[ ] (b) CHECK IF EXCHANGE IS FROM RESTRICTED CERTIFICATED NOTE TO
BENEFICIAL INTEREST IN A RESTRICTED GLOBAL NOTE. In connection with the
Exchange of the Owner's Restricted Certificated Note for a beneficial interest
in the [CHECK ONE] 144A Global Note, Regulation S Global Note, the Owner hereby
certifies (i) the beneficial interest is being acquired for the Owner's own
account without transfer and (ii) such Exchange has been effected in compliance
with the transfer restrictions applicable to the Restricted Global Notes and
pursuant to and in accordance with the Securities Act, and in compliance with
any applicable blue sky securities laws of any state of the United States. Upon
consummation of the proposed Exchange in accordance with the terms of the
Indenture, the beneficial interest issued shall be subject to the restrictions
on transfer enumerated in the Private Placement Legend printed on the relevant
Restricted Global Note and in the Indenture and the Securities Act.
This certificate and the statements contained herein are made for
your benefit and the benefit of the Company.
C-2
[Insert Name of Owner]
By:
-------------------------------
Name:
Title:
Dated: _____________, ____
C-3
EXHIBIT D
FORM OF NOTATION OF GUARANTEE
For value received, each Guarantor (which term includes any successor
Person under the Indenture) jointly and severally, unconditionally guarantees,
to the extent set forth in the Indenture and subject to the provisions in the
Indenture dated as of February 7, 2005 (the "Indenture") among Rayovac
Corporation (the "Company"), the Guarantors named therein and U.S. Bank
National Association, as trustee (the "Trustee"), (a) the due and punctual
payment of the principal of, premium and Liquidated Damages (as defined in the
Indenture), if any, and interest on the Notes (as defined in the Indenture),
whether at maturity, by acceleration, redemption or otherwise, the due and
punctual payment of interest on overdue principal and premium, and, to the
extent permitted by law, interest and Liquidated Damages, 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 of the Indenture and (b) in case
of any extension of time of payment or renewal of any Notes or any of such
other obligations, that the same shall 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. The obligations of the
Guarantors to the Holders of Notes and to the Trustee pursuant to the Note
Guarantee and the Indenture are expressly set forth in Article Eleven of the
Indenture and reference is hereby made to the Indenture for the precise terms
of the Note Guarantee. Each Holder of a Note, by accepting the same, (a) agrees
to and shall be bound by such provisions, (b) authorizes and directs the
Trustee, on behalf of such Holder, to take such action as may be necessary or
appropriate to effectuate the subordination as provided in the Indenture and
(c) appoints the Trustee attorney-in-fact of such Holder for such purpose;
provided, however, that the Indebtedness evidenced by this Note Guarantee shall
cease to be so subordinated and subject in right of payment upon any defeasance
of this Note in accordance with the provisions of the Indenture. Capitalized
terms used but not defined herein shall have the meanings ascribed to them in
the Indenture.
D-1
IN WITNESS HEREOF, the Guarantors have caused this Notation of Guarantee to be
executed by a duly authorized officer.
[Name of Guarantor]
By:
-----------------------------
Name:
Title:
D-2
EXHIBIT E
FORM OF SUPPLEMENTAL INDENTURE
TO BE DELIVERED BY SUBSEQUENT GUARANTORS
Supplemental Indenture (this "Supplemental Indenture"), dated as of
_____________, among __________________ (the "Guaranteeing Subsidiary"),
Rayovac Corporation, a Wisconsin Corporation, (the "Company"), the Guarantors
(as defined in the Indenture referred to herein) and U.S. Bank National
Association, as Trustee (the "Trustee").
W I T N E S S E T H
WHEREAS, the Company and the Guarantors have heretofore executed and
delivered to the Trustee an indenture (the "Indenture"), dated as of February
7, 2005 providing for the issuance of an unlimited aggregate principal amount
of 7 3/8% Senior Subordinated Notes due 2015 (the "Notes");
WHEREAS, the Indenture provides that under certain circumstances the
Guaranteeing Subsidiary shall execute and deliver to the Trustee a supplemental
indenture pursuant to which the Guaranteeing Subsidiary shall unconditionally
guarantee all of the Company's obligations under the Notes and the Indenture on
the terms and conditions set forth herein (the "Note Guarantee"); and
WHEREAS, pursuant to Section 9.01 of the Indenture, the Trustee is
authorized to execute and deliver this Supplemental Indenture.
NOW THEREFORE, in consideration of the foregoing and for other good
and valuable consideration, the receipt of which is hereby acknowledged, the
Guaranteeing Subsidiary and the Trustee mutually covenant and agree for the
equal and ratable benefit of the Holders of the Notes as follows:
1. Capitalized Terms. Capitalized terms used herein without definition
shall have the meanings assigned to them in the Indenture.
2. Agreement to Guarantee. The Guaranteeing Subsidiary hereby agrees
as follows:
(a) Along with all other Guarantors, to jointly and severally
Guarantee to each Holder of a Note authenticated and delivered by the
Trustee and to the Trustee and its successors and assigns,
irrespective of the validity and enforceability of the Indenture, the
Notes or the obligations of the Company hereunder or thereunder, that:
(i) the principal of and interest on the Notes shall
be promptly paid in full when due, whether at maturity, by
acceleration, redemption or otherwise, and interest on the
overdue principal of and interest on the Notes, if any, if
lawful (subject in all cases to any applicable grace period
E-1
provided in the Indenture), and all other obligations of the
Company to the Holders or the Trustee hereunder or thereunder
shall be promptly paid in full or performed, all in
accordance with the terms hereof and thereof; and
(ii) in case of any extension of time of payment or
renewal of any Notes or any of such other obligations, the
same shall 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.
Failing payment when due of any amount so guaranteed or any
performance so guaranteed for whatever reason, the Guarantors
shall be jointly and severally obligated to pay the same
immediately.
(b) The obligations hereunder shall be unconditional,
irrespective of the validity, regularity or enforceability of the
Notes or the Indenture, the absence of any action to enforce the same,
any waiver or consent by any Holder of the Notes with respect to any
provisions hereof or thereof, the recovery of any judgment against the
Company, any action to enforce the same or any other circumstance that
might otherwise constitute a legal or equitable discharge or defense
of a guarantor.
(c) Subject to Section 6.06 of the Indenture and to the
extent permitted by applicable law, 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.
(d) Subject to Section 6.06 of the Indenture and to the
extent permitted by applicable law, this Note Guarantee shall not be
discharged except by complete performance of the obligations contained
in the Notes and the Indenture.
(e) If any Holder or the Trustee is required by any court or
otherwise to return to the Company, the Guarantors, or any custodian,
trustee, liquidator or other similar official acting in relation to
either the Company or the Guarantors, any amount paid by either to the
Trustee or such Holder, this Note Guarantee, to the extent theretofore
discharged, shall be reinstated in full force and effect.
(f) The Guaranteeing Subsidiary shall not be entitled to any
right of subrogation in relation to the Holders in respect of any
obligations guaranteed hereby until payment in full of all obligations
guaranteed hereby.
(g) As between the Guarantors, 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 6 of the Indenture for the purposes of this Note 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 declaration of acceleration of such
obligations as provided in Article 6 of the Indenture, such
obligations (whether or not due and
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payable) shall forthwith become due and payable by the Guarantors for
the purpose of this Note Guarantee.
(h) The Guarantors shall have the right to seek contribution
from any non-paying Guarantor so long as the exercise of such right
does not impair the rights of the Holders under the Note Guarantee.
(i) Pursuant to Section 11.03 of the Indenture, after giving
effect to any maximum amount and any other contingent and fixed
liabilities of the Guarantor that are relevant under any applicable
Bankruptcy Law, the Uniform Fraudulent Conveyance Act, the Uniform
Fraudulent Transfer Act or any similar federal or state law to the
extent applicable, and after giving effect to any collections from,
rights to receive contribution from or payments made by or on behalf
of any other Guarantor in respect of the obligations of such other
Guarantor under Article 11 of the Indenture, the Trustee, the Holders
and the Guarantor irrevocably agree that the obligation of such
Guarantor shall result in the obligations of such Guarantor under its
Note Guarantee not constituting a fraudulent transfer or conveyance.
3. Subordination. The Obligations of the Guaranteeing
Subsidiary under its Note Guarantee pursuant to this Supplemental
Indenture shall be junior and subordinated to the Senior Debt of the
Guaranteeing Subsidiary on the same basis as the Notes are junior and
subordinated to the Senior Debt of the Company. For the purposes of
the foregoing sentence, the Trustee and the Holders shall have the
right to receive and/or retain payments by the Guaranteeing Subsidiary
only at such time as they may receive and/or retain payments in
respect of the Notes pursuant to the Indenture, including Article 10
thereof.
4. Execution and Delivery. Each Guaranteeing Subsidiary
agrees that the Note Guarantees shall remain in full force and effect
notwithstanding any failure to endorse on each Note a notation of such
Note Guarantee.
5. Guaranteeing Subsidiary May Consolidate, Etc., on Certain
Terms. Except as otherwise provided in Section 11.05 of the Indenture,
a Guarantor may not sell or otherwise dispose of all or substantially
all of its assets, or consolidate with or merge with or into (whether
or not such Guarantor is the surviving Person) another Person unless:
(a) immediately after giving effect to such transaction, no Default or
Event of Default exists; and
(b) either:
the Person acquiring the property in any such sale or
disposition or the Person formed by or surviving any such
consolidation or merger is a corporation, organized or
existing under (i) the laws of the United States, any state
thereof or the District of Columbia or (ii) the laws of the same
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jurisdiction as that Guarantor and, in each case,
assumes all the obligations of that Guarantor under the
Indenture, its Note Guarantee and the Registration Rights
Agreement pursuant to a supplemental indenture satisfactory
to the Trustee; or
in the case of a Subsidiary Guarantor, such sale or
other disposition (A) complies with Section 4.10 of the
Indenture, including the application of the Net Proceeds
therefrom and (B) is to a Person that is not a Restricted
Subsidiary of the Company.
In case of any such consolidation, merger, sale or conveyance
and upon the assumption by the successor Person, by supplemental indenture,
executed and delivered to the Trustee and satisfactory in form to the Trustee,
of the Note Guarantee endorsed upon the Notes and the due and punctual
performance of all of the obligations and conditions of the Indenture to be
performed by a Guarantor, such successor Person shall succeed to and be
substituted for a Guarantor with the same effect as if it had been named herein
as a Guarantor. Such successor Person thereupon may cause to be signed any or
all of the Note Guarantees to be endorsed upon all of the Notes issuable
hereunder which theretofore shall not have been signed by the Company and
delivered to the Trustee. All the Note Guarantees so issued shall in all
respects have the same legal rank and benefit under the Indenture as the Note
Guarantees theretofore and thereafter issued in accordance with the terms of
the Indenture as though all of such Note Guarantees had been issued at the date
of the execution hereof.
Except as set forth in Articles 4 and 5 of the Indenture, and
notwithstanding clauses (a) and (b) above, nothing contained in the Indenture
or in any of the Notes shall prevent any consolidation or merger of a Guarantor
with or into the Company or another Guarantor, or shall prevent any sale or
conveyance of the property of a Guarantor as an entirety or substantially as an
entirety to the Company or another Guarantor.
6. Releases. (a) Any Guarantor shall be released and relieved of any
obligations under its Note Guarantee, (i) in connection with any sale or other
disposition of all or substantially all of the assets of that Guarantor
(including by way of merger or consolidation) to a Person that is not (either
before or after giving effect to such transaction) a Restricted Subsidiary of
the Company, if the sale or other disposition of all or substantially all of
the assets of that Guarantor complies with Section 4.10 of the Indenture,
including the application of the Net Proceeds therefrom; (ii) in connection
with any sale of all of the Capital Stock of a Guarantor to a Person that is
not (either before or after giving effect to such transaction) a Restricted
Subsidiary of the Company, if the sale of all such Capital Stock of that
Guarantor complies with Section 4.10 of the Indenture, including the
application of the Net Proceeds therefrom; (iii) if the Company designates any
Restricted Subsidiary that is a Guarantor as an Unrestricted Subsidiary in
accordance with the terms hereof; or (iv) in connection with any sale of
Capital Stock of a Guarantor to a Person that results in the Guarantor no
longer being a Subsidiary of the
E-4
Company, if the sale of such Capital Stock of that Guarantor complies with
Section 4.10, including the application of the Net Proceeds therefrom. Upon
delivery by the Company to the Trustee of an Officers' Certificate and an
Opinion of Counsel to the effect that such sale or other disposition was made
by the Company in accordance with the provisions of the Indenture, including
without limitation Section 4.10 hereof, the Trustee shall execute any documents
reasonably required in order to evidence the release of any Guarantor from its
obligations under its Note Guarantee.
(b) Any Guarantor not released from its obligations under its Note
Guarantee shall remain liable for the full amount of principal of and interest
on the Notes and for the other obligations of any Guarantor under the Indenture
as provided in Article 10 of the Indenture.
7. No Recourse Against Others. No past, present or future director,
officer, employee, incorporator, stockholder or agent of the Guaranteeing
Subsidiary, as such, shall have any liability for any obligations of the
Company or any Guaranteeing Subsidiary under the Notes, any Note Guarantees,
the Indenture or this Supplemental Indenture or for any claim based on, in
respect of, or by reason of, such obligations or their creation. Each Holder of
the Notes by accepting a Note waives and releases all such liability. The
waiver and release are part of the consideration for issuance of the Notes.
Such waiver may not be effective to waive liabilities under the federal
securities laws.
8. NEW YORK LAW TO GOVERN. THE INTERNAL LAW OF THE STATE OF NEW YORK
SHALL GOVERN AND BE USED TO CONSTRUE THIS SUPPLEMENTAL INDENTURE.
9. Counterparts. The parties may sign any number of copies of this
Supplemental Indenture. Each signed copy shall be an original, but all of them
together represent the same agreement.
10. Effect of Headings. The Section headings herein are for
convenience only and shall not affect the construction hereof.
11. Trustee. The Trustee shall not be responsible in any manner
whatsoever for or in respect of the validity or sufficiency of this
Supplemental Indenture or for or in respect of the recitals contained herein,
all of which recitals are made solely by the Guaranteeing Subsidiary and the
Company.
E-5
IN WITNESS WHEREOF, the parties hereto have caused this Supplemental
Indenture to be duly executed and attested, all as of the date first above
written.
Dated: _______________, ____
[Guaranteeing Subsidiary]
By:
-------------------------------
Name:
Title:
[Name of Guarantor]
By:
-------------------------------
Name:
Title:
RAYOVAC CORPORATION
By:
-------------------------------
Name:
Title:
U.S. BANK NATIONAL
ASSOCIATION, AS TRUSTEE
By:
-------------------------------
Name:
Title:
E-6
SCHEDULE I
GUARANTORS
ROV Holding, Inc.
Rovcal, Inc.
United Industries Corporation
Schultz Company
WPC Brands, Inc.
Sylorr Plant Corp.
Ground Zero, Inc.
Nu-Gro US Holdco Corporation
Nu-Gro America Corp.
IB Nitrogen Inc.
Nu-Gro Technologies, Inc.
United Pet Group, Inc.
DB Online, LLC
Southern California Foam, Inc.
AQ Holdings, Inc.
Aquaria, Inc.
Perfecto Holding Corp.
Aquarium Systems, Inc.
Perfecto Manufacturing, Inc.
Jungle Talk International, Inc.
Pets `N People, Inc.
EXHIBIT 4.2
RAYOVAC CORPORATION
8 1/2% SENIOR SUBORDINATED NOTES DUE 2013
________________________________
THIRD SUPPLEMENTAL INDENTURE
Dated as of February 7, 2005
to
INDENTURE
Dated as of September 30, 2003
_________________________________
U.S. BANK
NATIONAL ASSOCIATION,
as Trustee
________________________________
THIRD SUPPLEMENTAL INDENTURE
THIRD SUPPLEMENTAL INDENTURE (this "Supplemental Indenture"), dated as
of February 7, 2005 among Rayovac Corporation, a Wisconsin corporation, (the
"Company"), the Guarantors (as defined in the Indenture referred to herein),
the Rayovac subsidiaries listed in Exhibit A hereto (each, a "Guaranteeing
Subsidiary" and, together, the "Guaranteeing Subsidiaries"), and U.S. Bank
National Association, as Trustee (the "Trustee").
W I T N E S S E T H
WHEREAS, the Company and the Guarantors have heretofore executed and
delivered to the Trustee an indenture, dated as of September 30, 2003, as
supplemented by the Supplemental Indenture dated as of October 24, 2003 and the
Second Supplemental Indenture dated as of January 20, 2005 (the "Indenture"),
providing for the issuance of the Company's 8 1/2% Senior Subordinated Notes
due 2013 (the "Notes"); and
WHEREAS, the Indenture provides that if the Company acquires
additional Domestic Subsidiaries on or after the Issue Date, each such
subsidiary shall execute and deliver to the Trustee a supplemental indenture
pursuant to which such subsidiary shall unconditionally guarantee all of the
Company's obligations under the Notes and the Indenture on the terms and
conditions set forth herein (the "Note Guarantee"); and
WHEREAS, in connection with the Company's acquisition of all of the
equity interests of United Industries Corporation (the "Acquisition"), the
Company has acquired each of the Guaranteeing Subsidiaries; and
WHEREAS, also in connection with the Acquisition, the separate
corporate existence of Lindbergh Corporation, a former subsidiary of the
Company, has ceased; and
WHEREAS, the Trustee, the Company and the Guarantors wish to cure
certain errors relating to certain cross-references in the Indenture; and
WHEREAS, pursuant to Section 9.01 of the Indenture, the Trustee is
authorized to execute and deliver this Supplemental Indenture;
NOW, THEREFORE, in consideration of the foregoing and for other good
and valuable consideration, the receipt of which is hereby acknowledged, the
Guaranteeing Subsidiaries, the Guarantors and the Trustee mutually covenant and
agree for the equal and ratable benefit of the Holders of the Notes as follows:
1. Capitalized Terms. Capitalized terms used herein without definition
shall have the meanings assigned to them in the Indenture.
2
2. Guarantors. Pursuant to Section 9.01 of the Indenture, the Company,
the Guarantors and the Trustee hereby amend the definition of the term
"Guarantors" set forth in the Indenture by (a) adding to Schedule I to the
Indenture those entities listed in Exhibit A hereto and (b) deleting from such
Schedule I "Lindbergh Corporation." For purposes of clarification, Schedule I
to the Indenture shall be identical to Schedule I-A attached hereto.
3. Agreement to Guarantee. The Guaranteeing Subsidiaries hereby agree
as follows:
(a) Along with all other Guarantors, to jointly and severally
Guarantee to each Holder of a Note authenticated and delivered by the
Trustee and to the Trustee and its successors and assigns, irrespective of
the validity and enforceability of the Indenture, the Notes or the
obligations of the Company hereunder or thereunder, that:
(i) the principal of and interest on the Notes shall be promptly
paid in full when due, whether at maturity, by acceleration,
redemption or otherwise, and interest on the overdue principal of and
interest on the Notes, if any, if lawful (subject in all cases to any
applicable grace period provided in the Indenture), and all other
obligations of the Company to the Holders or the Trustee hereunder or
thereunder shall be promptly paid in full or performed, all in
accordance with the terms hereof and thereof; and
(ii) in case of any extension of time of payment or renewal of any
Notes or any of such other obligations, the same shall 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. Failing payment when due of any amount so guaranteed or any
performance so guaranteed for whatever reason, the Guarantors shall be
jointly and severally obligated to pay the same immediately.
(b) The obligations hereunder shall be unconditional, irrespective of
the validity, regularity or enforceability of the Notes or the Indenture,
the absence of any action to enforce the same, any waiver or consent by
any Holder of the Notes with respect to any provisions hereof or thereof,
the recovery of any judgment against the Company, any action to enforce
the same or any other circumstance that might otherwise constitute a legal
or equitable discharge or defense of a guarantor.
(c) Subject to Section 6.06 of the Indenture and to the extent
permitted by applicable law, 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.
3
(d) Subject to Section 6.06 of the Indenture and to the extent
permitted by applicable law, this Note Guarantee shall not be discharged
except by complete performance of the obligations contained in the Notes
and the Indenture.
(e) If any Holder or the Trustee is required by any court or otherwise
to return to the Company, the Guarantors, or any custodian, trustee,
liquidator or other similar official acting in relation to either the
Company or the Guarantors, any amount paid by either to the Trustee or
such Holder, this Note Guarantee, to the extent theretofore discharged,
shall be reinstated in full force and effect.
(f) The Guaranteeing Subsidiaries shall not be entitled to any right
of subrogation in relation to the Holders in respect of any obligations
guaranteed hereby until payment in full of all obligations guaranteed
hereby.
(g) As between the Guarantors, 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 6 of the
Indenture for the purposes of this Note 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
declaration of acceleration of such obligations as provided in Article 6
of the Indenture, such obligations (whether or not due and payable) shall
forthwith become due and payable by the Guarantors for the purpose of this
Note Guarantee.
(h) The Guarantors shall have the right to seek contribution from any
non-paying Guarantor so long as the exercise of such right does not impair
the rights of the Holders under the Note Guarantee.
(i) Pursuant to Section 11.03 of the Indenture, after giving effect to
any maximum amount and any other contingent and fixed liabilities of the
Guarantor that are relevant under any applicable Bankruptcy Law, the
Uniform Fraudulent Conveyance Act, the Uniform Fraudulent Transfer Act or
any similar federal or state law to the extent applicable, and after
giving effect to any collections from, rights to receive contribution from
or payments made by or on behalf of any other Guarantor in respect of the
obligations of such other Guarantor under Article 11 of the Indenture, the
Trustee, the Holders and the Guarantor irrevocably agree that the
obligation of such Guarantor shall result in the obligations of such
Guarantor under its Note Guarantee not constituting a fraudulent transfer
or conveyance.
4. Subordination. The Obligations of each Guaranteeing Subsidiary
under its Note Guarantee pursuant to this Supplemental Indenture shall be
junior and subordinated to the Senior Debt of such Guaranteeing Subsidiary on
the same basis as the Notes are junior and subordinated to the Senior Debt of
the Company. For the purposes of the foregoing sentence, the Trustee and the
Holders shall have the right to receive and/or retain payments by each
Guaranteeing Subsidiary only at such time as they may
4
receive and/or retain payments in respect of the Notes pursuant to the
Indenture, including Article 10 thereof.
5. Execution and Delivery. The Guaranteeing Subsidiaries agree that
the Note Guarantees shall remain in full force and effect notwithstanding any
failure to endorse on each Note a notation of such Note Guarantee.
6. Guaranteeing Subsidiaries May Consolidate, Etc., on Certain Terms.
Except as otherwise provided in Section 11.05 of the Indenture, a Guarantor may
not sell or otherwise dispose of all or substantially all of its assets, or
consolidate with or merge with or into (whether or not such Guarantor is the
surviving Person) another Person unless:
(a) immediately after giving effect to such transaction, no Default or
Event of Default exists; and
(b) either:
(i) the Person acquiring the property in any such sale or
disposition or the Person formed by or surviving any such
consolidation or merger is a corporation, organized or existing under
(i) the laws of the United States, any state thereof or the District
of Columbia or (ii) the laws of the same jurisdiction as that
Guarantor and, in each case, assumes all the obligations of that
Guarantor under the Indenture, its Note Guarantee and the Registration
Rights Agreement pursuant to a supplemental indenture satisfactory to
the Trustee; or
(ii) in the case of a Subsidiary Guarantor, such sale or other
disposition (A) complies with Section 4.10 of the Indenture, including
the application of the Net Proceeds therefrom and (B) is to a Person
that is not a Restricted Subsidiary of the Company.
In case of any such consolidation, merger, sale or conveyance and upon
the assumption by the successor Person, by supplemental indenture, executed and
delivered to the Trustee and satisfactory in form to the Trustee, of the Note
Guarantee endorsed upon the Notes and the due and punctual performance of all
of the obligations and conditions of the Indenture to be performed by a
Guarantor, such successor Person shall succeed to and be substituted for a
Guarantor with the same effect as if it had been named herein as a Guarantor.
Such successor Person thereupon may cause to be signed any or all of the Note
Guarantees to be endorsed upon all of the Notes issuable hereunder which
theretofore shall not have been signed by the Company and delivered to the
Trustee. All the Note Guarantees so issued shall in all respects have the same
legal rank and benefit under the Indenture as the Note Guarantees theretofore
and thereafter issued in accordance with the terms of the Indenture as though
all of such Note Guarantees had been issued at the date of the execution
hereof.
5
Except as set forth in Articles 4 and 5 of the Indenture, and
notwithstanding clauses (a) and (b) above, nothing contained in the Indenture
or in any of the Notes shall prevent any consolidation or merger of a Guarantor
with or into the Company or another Guarantor, or shall prevent any sale or
conveyance of the property of a Guarantor as an entirety or substantially as an
entirety to the Company or another Guarantor.
7. Releases. (a) Any Guarantor shall be released and relieved of any
obligations under its Note Guarantee, (i) in connection with any sale or other
disposition of all or substantially all of the assets of that Guarantor
(including by way of merger or consolidation) to a Person that is not (either
before or after giving effect to such transaction) a Restricted Subsidiary of
the Company, if the sale or other disposition of all or substantially all of
the assets of that Guarantor complies with Section 4.10 of the Indenture,
including the application of the Net Proceeds therefrom; (ii) in connection
with any sale of all of the Capital Stock of a Guarantor to a Person that is
not (either before or after giving effect to such transaction) a Restricted
Subsidiary of the Company, if the sale of all such Capital Stock of that
Guarantor complies with Section 4.10 of the Indenture, including the
application of the Net Proceeds therefrom; (iii) if the Company designates any
Restricted Subsidiary that is a Guarantor as an Unrestricted Subsidiary in
accordance with the terms hereof; or (iv) in connection with any sale of
Capital Stock of a Guarantor to a Person that results in the Guarantor no
longer being a Subsidiary of the Company, if the sale of such Capital Stock of
that Guarantor complies with Section 4.10, including the application of the Net
Proceeds therefrom. Upon delivery by the Company to the Trustee of an Officers'
Certificate and an Opinion of Counsel to the effect that such sale or other
disposition was made by the Company in accordance with the provisions of the
Indenture, including without limitation Section 4.10 hereof, the Trustee shall
execute any documents reasonably required in order to evidence the release of
any Guarantor from its obligations under its Note Guarantee.
(b) Any Guarantor not released from its obligations under its Note
Guarantee shall remain liable for the full amount of principal of and interest
on the Notes and for the other obligations of any Guarantor under the Indenture
as provided in Article 10 of the Indenture.
8. No Recourse Against Others. No past, present or future director,
officer, employee, incorporator, stockholder or agent of any Guaranteeing
Subsidiary, as such, shall have any liability for any obligations of the
Company or any Guaranteeing Subsidiary under the Notes, any Note Guarantees,
the Indenture or this Supplemental Indenture or for any claim based on, in
respect of, or by reason of, such obligations or their creation. Each Holder of
the Notes by accepting a Note waives and releases all such liability. The
waiver and release are part of the consideration for issuance of the Notes.
Such waiver may not be effective to waive liabilities under the federal
securities laws.
9. Correction of Cross-References. In order to correct certain cross-
references in the Indenture:
6
(a) The last sentence of subsection (ii) of Section 2.06(b) of the
Indenture is hereby deleted and restated in its entirety to read as follows:
"Upon satisfaction of all of the requirements for transfer or exchange
of beneficial interests in Global Notes contained in this Indenture
and the Notes or otherwise applicable under the Securities Act, the
Trustee shall adjust the principal amount of the relevant Global
Note(s) pursuant to Section 2.06(i) hereof."
(b) The first phrase following subsection (i)(F) of Section 2.06(c) of
the Indenture is hereby deleted and restated in its entirety to read as
follows:
"the Trustee shall cause the aggregate principal amount of the
applicable Global Note to be reduced accordingly pursuant to Section
2.06(i) hereof, and the Company shall execute and the Trustee shall
authenticate and deliver to the Person designated in the instructions
a Certificated Note in the appropriate principal amount."
(c) The first sentence of subsection (iv) of Section 2.06(c) of the
Indenture is hereby deleted and restated in its entirety to read as follows:
"If any Holder of a beneficial interest in an Unrestricted Global Note
proposes to exchange such beneficial interest for a Certificated Note
or to transfer such beneficial interest to a Person who takes delivery
thereof in the form of a Certificated Note, then, upon satisfaction of
the conditions set forth in Section 2.06(b)(ii) hereof, the Trustee
shall cause the aggregate principal amount of the applicable Global
Note to be reduced accordingly pursuant to Section 2.06(i) hereof, and
the Company shall execute and the Trustee shall authenticate and
deliver to the Person designated in the instructions a Certificated
Note in the appropriate principal amount."
(d) Third sentence of Section 4.10(d) of the Indenture is hereby
deleted and restated in its entirety to read as follows:
"To the extent that the provisions of any securities laws or
regulations conflict with this Section 4.10 or Section 3.09, the
Company shall comply with the applicable securities laws and
regulations and shall not be deemed to have breached its obligations
under this Section 4.10 or Section 3.09 by virtue of such compliance."
(e) Subsection (iii) of Section 6.01 of the Indenture is hereby
deleted and restated in its entirety to read as follows:
"failure by the Company or any of its Restricted Subsidiaries to
comply with Section 4.10, Section 4.14, Section 4.20(c) or Section
5.01;"
7
(f) Section 9.01(f) of the Indenture is hereby deleted and restated in
its entirety to read as follows:
"to comply with the requirements of Section 4.20;"
10. GOVERNING LAW. THE INTERNAL LAWS OF THE STATE OF NEW YORK SHALL
GOVERN AND BE USED TO CONSTRUE THIS SUPPLEMENTAL INDENTURE BUT WITHOUT GIVING
EFFECT TO APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE
APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.
11. Counterparts. The parties may sign any number of copies of this
Supplemental Indenture. Each signed copy shall be an original, but all of them
together represent the same agreement.
12. Effect of Headings. The Section headings herein are for
convenience only and shall not affect the construction hereof.
13. Trustee. The Trustee shall not be responsible in any manner
whatsoever for or in respect of the validity or sufficiency of this
Supplemental Indenture or for or in respect of the recitals contained herein,
all of which recitals are made solely by the Guaranteeing Subsidiary and the
Company.
8
IN WITNESS WHEREOF, the parties hereto have caused this Third
Supplemental Indenture to be duly executed and attested, all as of the dates
referenced.
Dated: February 7, 2005
ROV HOLDING, INC.
By: /s/ James T. Lucke
------------------------------------
Name: James T. Lucke
Title: Secretary
ROVCAL, INC.
By: /s/ James T. Lucke
------------------------------------
Name: James T. Lucke
Title: Secretary
UNITED INDUSTRIES CORPORATION
By: /s/ Louis N. Laderman
------------------------------------
Name: Louis N. Laderman
Title: Vice President, Secretary and
General Counsel
SCHULTZ COMPANY
By: /s/ Louis N. Laderman
------------------------------------
Name: Louis N. Laderman
Title: Vice President and Secretary
WPC BRANDS, INC.
By: /s/ Louis N. Laderman
------------------------------------
Name: Louis N. Laderman
Title: Vice President and Secretary
SYLORR PLANT CORP.
By: /s/ Louis N. Laderman
------------------------------------
Name: Louis N. Laderman
Title: Vice President and Secretary
9
GROUND ZERO, INC.
By: /s/ Louis N. Laderman
------------------------------------
Name: Louis N. Laderman
Title: Vice President and Secretary
NU-GRO US HOLDCO CORPORATION
By: /s/ Louis N. Laderman
------------------------------------
Name: Louis N. Laderman
Title: Secretary
NU-GRO AMERICA CORP.
By: /s/ Louis N. Laderman
------------------------------------
Name: Louis N. Laderman
Title: Vice President and Secretary
IB NITROGEN INC.
By: /s/ Louis N. Laderman
------------------------------------
Name: Louis N. Laderman
Title: Vice President and Secretary
NU-GRO TECHNOLOGIES, INC.
By: /s/ Louis N. Laderman
------------------------------------
Name: Louis N. Laderman
Title: Vice President and Secretary
UNITED PET GROUP, INC.
By: /s/ Louis N. Laderman
------------------------------------
Name: Louis N. Laderman
Title: Vice President and Secretary
10
DB ONLINE, LLC
By: /s/ Louis N. Laderman
------------------------------------
Name: Louis N. Laderman
Title: Vice President and Secretary
SOUTHERN CALIFORNIA FOAM, INC.
By: /s/ Louis N. Laderman
------------------------------------
Name: Louis N. Laderman
Title: Vice President and Secretary
AQ HOLDINGS, INC.
By: /s/ Louis N. Laderman
------------------------------------
Name: Louis N. Laderman
Title: Vice President and Secretary
AQUARIA, INC.
By: /s/ Louis N. Laderman
------------------------------------
Name: Louis N. Laderman
Title: Vice President and Secretary
PERFECTO HOLDING CORP.
By: /s/ Louis N. Laderman
------------------------------------
Name: Louis N. Laderman
Title: Vice President and Secretary
AQUARIUM SYSTEMS, INC.
By: /s/ Louis N. Laderman
------------------------------------
Name: Louis N. Laderman
Title: Vice President and Secretary
11
PERFECTO MANUFACTURING, INC.
By: /s/ Louis N. Laderman
------------------------------------
Name: Louis N. Laderman
Title: Vice President and Secretary
JUNGLE TALK INTERNATIONAL, INC.
By: /s/ Louis N. Laderman
------------------------------------
Name: Louis N. Laderman
Title: Vice President and Secretary
PETS `N PEOPLE, INC.
By: /s/ Louis N. Laderman
------------------------------------
Name: Louis N. Laderman
Title: Vice President and Secretary
RAYOVAC CORPORATION
By: /s/ James T. Lucke
------------------------------------
Name: James T. Lucke
Title: Senior Vice President -
General Counsel and Secretary
U.S. BANK NATIONAL ASSOCIATION,
AS TRUSTEE
By: /s/ Richard H. Prokosch
------------------------------------
Name: Richard H. Prokosch
Title: Vice President
12
Exhibit A
Guaranteeing Subsidiaries
United Industries Corporation
Schultz Company
WPC Brands, Inc.
Sylorr Plant Corp.
Ground Zero, Inc.
Nu-Gro US Holdco Corporation
Nu-Gro America Corp.
IB Nitrogen Inc.
Nu-Gro Technologies, Inc.
United Pet Group, Inc.
DB Online, LLC
Southern California Foam, Inc.
AQ Holdings, Inc.
Aquaria, Inc.
Perfecto Holding Corp.
Aquarium Systems, Inc.
Perfecto Manufacturing, Inc.
Jungle Talk International, Inc.
Pets `N People, Inc.
SCHEDULE I-A
GUARANTORS
----------
ROV Holding, Inc.
Rovcal, Inc.
United Industries Corporation
Schultz Company
WPC Brands, Inc.
Sylorr Plant Corp.
Ground Zero, Inc.
Nu-Gro US Holdco Corporation
Nu-Gro America Corp.
IB Nitrogen Inc.
Nu-Gro Technologies, Inc.
United Pet Group, Inc.
DB Online, LLC
Southern California Foam, Inc.
AQ Holdings, Inc.
Aquaria, Inc.
Perfecto Holding Corp.
Aquarium Systems, Inc.
Perfecto Manufacturing, Inc.
Jungle Talk International, Inc.
Pets `N People, Inc.
EXHIBIT 4.3
REGISTRATION RIGHTS AGREEMENT
by and among
Rayovac Corporation
and
The Guarantors listed on Schedule A hereto
and
Banc of America Securities LLC
Citigroup Global Markets Inc.
Merrill Lynch, Pierce, Fenner & Smith Incorporated
ABN AMRO Incorporated
Dated as of February 7, 2005
Registration Rights Agreement
This Registration Rights Agreement (this "Agreement") is made and
entered into as of February 7, 2005, by and among Rayovac Corporation, a
Wisconsin corporation (the "Company"), and the guarantors listed on Schedule A
hereto (the "Guarantors"), and Banc of America Securities LLC, Citigroup
Global Markets Inc., Merrill Lynch, Pierce, Fenner & Smith Incorporated and
ABN AMRO Incorporated (each an "Initial Purchaser" and, collectively, the
"Initial Purchasers"), each of whom has agreed to purchase the Company's 7 3/8%
Senior Subordinated Notes due 2015 (the "Initial Notes") pursuant to the
Purchase Agreement (as defined below).
This Agreement is made pursuant to the Purchase Agreement, dated as
of January 21, 2005 (the "Purchase Agreement"), by and among the Company,
Rovcal, Inc. and ROV Holding, Inc. and the Initial Purchasers (i) for the
benefit of each Initial Purchaser and (ii) for the benefit of the holders from
time to time of the Initial Notes (including each Initial Purchaser). In order
to induce the Initial Purchasers to purchase the Initial Notes, the Company
has agreed to provide the registration rights set forth in this Agreement. The
execution and delivery of this Agreement is a condition to the obligations of
the Initial Purchasers set forth in Section 5(i) of the Purchase Agreement.
The parties hereby agree as follows:
SECTION 1. Definitions. As used in this Agreement, the following
capitalized terms shall have the following meanings:
Advice: As defined in the last paragraph of Section 6 hereof.
Agreement: As defined in the preamble.
Broker-Dealer: Any broker or dealer registered under the Exchange
Act.
Business Day: Any day except a Saturday, Sunday or other day that in
the City of New York, or in the city of the corporate trust office of the
Trustee, banks are authorized to close.
Closing Date: The date of this Agreement.
Commission: The Securities and Exchange Commission.
Company: As defined in the preamble hereto.
Consummate: An Exchange Offer shall be deemed "Consummated" or the
"Consummation" of which shall be deemed to have occurred for purposes of this
Agreement upon the occurrence of (i) the filing and effectiveness under the
Securities Act of the Exchange Offer Registration Statement relating to the
Exchange Notes to be issued in the Exchange Offer, (ii) the maintenance of
such Registration Statement continuously effective and the keeping of the
Exchange Offer open for a period not less than the minimum period required
pursuant to Section 3(b) hereof, and (iii) the delivery by the Company to the
Registrar under the Indenture of
1
Exchange Notes in the same aggregate principal amount as the aggregate
principal amount of Initial Notes that were tendered by Holders thereof
pursuant to the Exchange Offer.
Controlling Person: As defined in Section 8(a) hereof.
Effectiveness Target Date: As defined in Section 5 hereof.
Exchange Act: The Securities Exchange Act of 1934, as amended.
Exchange Notes: The 7 3/8% Senior Subordinated Notes due 2015, of the
same series under the Indenture as the Initial Notes, to be issued to Holders
in exchange for Transfer Restricted Securities pursuant to this Agreement.
Exchange Offer: The registration by the Company under the Securities
Act of the Exchange Notes pursuant to a Registration Statement pursuant to
which the Company offers the Holders of all outstanding Transfer Restricted
Securities the opportunity to exchange all such outstanding Transfer
Restricted Securities held by such Holders for Exchange Notes in an aggregate
principal amount equal to the aggregate principal amount of the Transfer
Restricted Securities tendered in such exchange offer by such Holders.
Exchange Offer Registration Statement: The Registration Statement
relating to the Exchange Offer, including the related Prospectus.
Guarantors: As defined in the preamble.
Holders: As defined in Section 2(b) hereof.
Indemnified Holder: As defined in Section 8(a) hereof.
Indenture: The Indenture, dated as of February 7, 2005, among the
Company, the Guarantors and U.S. Bank, National Association, as trustee (the
"Trustee"), pursuant to which the Notes are to be issued, as such Indenture is
amended or supplemented from time to time in accordance with the terms
thereof.
Initial Notes: As defined in the preamble hereto.
Initial Placement: The issuance and sale by the Company of the
Initial Notes to the Initial Purchasers pursuant to the Purchase Agreement.
Initial Purchaser: As defined in the preamble hereto.
Liquidated Damages: As defined in Section 5 hereof.
NASD: National Association of Securities Dealers, Inc.
Notes: The Initial Notes and the Exchange Notes.
Person: An individual, partnership, corporation, trust or
unincorporated organization, or a government or agency or political
subdivision thereof.
2
Prospectus: The prospectus included in a Registration Statement, as
amended or supplemented by any prospectus supplement and by all other
amendments thereto, including post-effective amendments, and all material
incorporated by reference into such Prospectus.
Purchase Agreement: As defined in the preamble.
Registration Default: As defined in Section 5 hereof.
Registration Statement: Any registration statement of the Company
relating to (a) an offering of Exchange Notes pursuant to an Exchange Offer or
(b) the registration for resale of Transfer Restricted Securities pursuant to
the Shelf Registration Statement, in each case, (i) which is filed pursuant to
the provisions of this Agreement, (ii) all amendments and supplements thereto
(including post-effective amendments) and all exhibits and material
incorporated by reference therein and (iii) the Prospectus included therein.
Securities Act: The Securities Act of 1933, as amended.
Shelf Filing Deadline: As defined in Section 4 hereof.
Shelf Registration Statement: As defined in Section 4 hereof.
Suspension Notice: As defined in the last paragraph of Section 6
hereof.
Transfer Restricted Securities: Each Initial Note, until the earliest
to occur of (a) the date on which such Initial Note is exchanged in the
Exchange Offer and entitled to be resold to the public by the Holder thereof
without complying with the prospectus delivery requirements of the Securities
Act, (b) following the exchange by a broker-dealer in the Exchange Offer of an
Initial Note for an Exchange Note, the date on which such Exchange Note is
sold to a purchaser who receives from such Broker-Dealer on or prior to the
date of such sale a copy of the prospectus contained in the Exchange Offer
Registration Statement, (c) the date on which such Initial Note has been
effectively registered under the Securities Act and disposed of in accordance
with a Shelf Registration Statement and (d) the date on which such Initial
Note is distributed to the public pursuant to Rule 144 under the Securities
Act.
Trustee: As defined in the definition of the Indenture herein.
Trust Indenture Act: The Trust Indenture Act of 1939 (15 U.S.C.
Section 77aaa 77bbbb) as in effect on the date of the Indenture.
Underwritten Registration or Underwritten Offering: A registration in
which securities of the Company are sold to an underwriter for reoffering to
the public.
SECTION 2. Securities Subject to this Agreement.
(a) Transfer Restricted Securities. The securities subject to the
benefits of this Agreement are the Transfer Restricted Securities.
3
(b) Holders of Transfer Restricted Securities. A Person is deemed to
be a holder of Transfer Restricted Securities (each, a "Holder") whenever such
Person owns Transfer Restricted Securities.
SECTION 3. Registered Exchange Offer.
(a) Unless the Exchange Offer shall not be permissible under
applicable law or Commission policy (after the procedures set forth in Section
6(a) below have been complied with), the Company and the Guarantors shall (i)
cause the Exchange Offer Registration Statement to be filed with the
Commission as soon as reasonably practicable after the Closing Date, but in no
event later than 120 days after the Closing Date, (ii) use their commercially
reasonable efforts to cause the Exchange Offer Registration Statement to
become effective as soon as reasonably practicable, but in no event later than
240 days, after the Closing Date, (iii) in connection with the foregoing, use
their commercially reasonable efforts to file (A) all pre-effective amendments
to such Registration Statement as may be necessary in order to cause such
Exchange Offer Registration Statement to become effective, (B) if applicable,
a post-effective amendment to such Exchange Offer Registration Statement
pursuant to Rule 430A under the Securities Act and (C) cause all necessary
filings in connection with the registration and qualification of the Exchange
Notes to be made under the Blue Sky laws of such jurisdictions as are
necessary to permit Consummation of the Exchange Offer (provided, however,
that the Company and the Guarantors shall not be required to qualify as a
foreign corporation or to take any action that would subject it to general
service of process in any such jurisdiction where it is not presently
qualified or where it would be subject to taxation as a foreign corporation)
and (iv) upon the effectiveness of such Exchange Offer Registration Statement,
commence the Exchange Offer. The Exchange Offer shall be on the appropriate
form permitting registration of the Exchange Notes to be offered in exchange
for the Transfer Restricted Securities and to permit resales of Transfer
Restricted Securities held by Broker-Dealers as contemplated by Section 3(c)
below.
(b) The Company and the Guarantors shall use their commercially
reasonable efforts to cause the Exchange Offer Registration Statement to be
effective continuously and shall keep the Exchange Offer open for a period of
not less than the minimum period required under applicable federal and state
securities laws to Consummate the Exchange Offer; provided, however, that in
no event shall such period be less than 30 days after the date notice of the
Exchange Offer is mailed to the Holders. The Company and the Guarantors shall
cause the Exchange Offer to comply with all applicable federal and state
securities laws. No securities other than the Exchange Notes shall be included
in the Exchange Offer Registration Statement. The Company and the Guarantors
shall use their commercially reasonable efforts to cause the Exchange Offer to
be Consummated as soon as reasonably practicable after the Exchange Offer
Registration Statement has become effective, but in no event later than 30
Business Days after the Exchange Offer Registration Statement has become
effective.
(c) The Company and the Guarantors shall indicate in a "Plan of
Distribution" section contained in the Prospectus forming a part of the
Exchange Offer Registration Statement that any Broker-Dealer who holds Initial
Notes that are Transfer Restricted Securities and that were acquired for its
own account as a result of market-making activities or other trading
activities (other than Transfer Restricted Securities acquired directly from
the Company), may exchange
4
such Initial Notes pursuant to the Exchange Offer, and in light of that, such
Broker-Dealer may be deemed to be an "underwriter" within the meaning of the
Securities Act and must, therefore, deliver a prospectus meeting the
requirements of the Securities Act in connection with any resales of the
Exchange Notes received by such Broker-Dealer in the Exchange Offer, which
prospectus delivery requirement may be satisfied by the delivery by such
Broker-Dealer of the Prospectus contained in the Exchange Offer Registration
Statement. Such "Plan of Distribution" section shall also contain all other
information with respect to such resales by Broker-Dealers that the Commission
may require in order to permit such resales pursuant thereto, but such "Plan
of Distribution" shall not name any such Broker-Dealer or disclose the amount
of Notes held by any such Broker-Dealer except to the extent required by the
Commission as a result of a change in policy, rules or regulations after the
date of this Agreement.
The Company and the Guarantors shall use their commercially
reasonable efforts to keep the Exchange Offer Registration Statement
continuously effective, supplemented and amended as required by the provisions
of Section 6(c) below to the extent necessary to ensure that it is available
for resales of Notes acquired by Broker-Dealers for their own accounts as a
result of market-making activities or other trading activities, and to ensure
that it conforms with the requirements of this Agreement, the Securities Act
and the policies, rules and regulations of the Commission as announced from
time to time, for a period ending on the earlier of (i) 180 days from the date
on which the Exchange Offer Registration Statement is declared effective and
(ii) the date on which a Broker-Dealer is no longer required to deliver a
prospectus in connection with market-making or other trading activities.
The Company and the Guarantors shall provide sufficient copies of the
latest version of such Prospectus to Broker-Dealers promptly upon request at
any time during such 180-day (or shorter as provided in the foregoing
sentence) period in order to facilitate such resales.
SECTION 4. Shelf Registration.
(a) Shelf Registration. If (i) the Company and the Guarantors are not
required to file an Exchange Offer Registration Statement or to consummate the
Exchange Offer because the Exchange Offer is not permitted by applicable law
or Commission policy (after the procedures set forth in Section 6(a) below
have been complied with) or (ii) any Holder of Transfer Restricted Securities
shall notify the Company in writing prior to the 20th day following the
Consummation of the Exchange Offer that (A) such Holder is prohibited by
applicable law or Commission policy from participating in the Exchange Offer,
(B) such Holder may not resell the Exchange Notes acquired by it in the
Exchange Offer to the public without delivering a prospectus and that the
Prospectus contained in the Exchange Offer Registration Statement is not
appropriate or available for such resales by such Holder or (C) such Holder is
a Broker-Dealer and holds Initial Notes acquired directly from the Company or
one of its affiliates, then the Company and the Guarantors shall:
(x) use their commercially reasonable efforts to cause to be
filed a shelf registration statement pursuant to Rule 415 under the
Securities Act, which may be an amendment to the Exchange Offer
Registration Statement (in either event, the "Shelf Registration
Statement"), on or prior to the earliest to occur of (1) the 60th day
after the date on which the Company determines that it not required
to file the Exchange Offer
5
Registration Statement pursuant to clause (a)(i) above and (2) the
60th day after the date on which the Company receives notice from a
Holder of Transfer Restricted Securities as contemplated by clause
(a)(ii) above (such earliest date being the "Shelf Filing Deadline"),
which Shelf Registration Statement shall provide for the resale of
all Transfer Restricted Securities the Holders of which shall have
provided the information required pursuant to Section 4(b) hereof;
and
(y) use their commercially reasonable efforts to cause such
Shelf Registration Statement to be declared effective by the
Commission on or before the 120th day after the Shelf Filing
Deadline.
The Company and the Guarantors shall use their commercially
reasonable efforts to keep such Shelf Registration Statement continuously
effective, supplemented and amended as required by and subject to the
provisions of Sections 6(b) and (c) hereof to the extent necessary to ensure
that it is available for resales of Transfer Restricted Securities by the
Holders thereof entitled to the benefit of this Section 4(a), and to ensure
that it conforms with the requirements of this Agreement, the Securities Act
and the policies, rules and regulations of the Commission as announced from
time to time, for a period of at least two years following the date of
effectiveness of the Shelf Registration Statement (or, if earlier, until the
date when all Transfer Restricted Securities covered by such Shelf
Registration Statement have been sold pursuant to such Shelf Registration
Statement).
(b) Provision by Holders of Certain Information in Connection with
the Shelf Registration Statement. No Holder of Transfer Restricted Securities
may include any of its Transfer Restricted Securities in any Shelf
Registration Statement pursuant to this Agreement unless and until such Holder
furnishes to the Company in writing, within 20 Business Days after receipt of
a request therefor, such information as the Company may reasonably request for
use in connection with any Shelf Registration Statement or Prospectus or
preliminary Prospectus included therein. Each Holder as to which any Shelf
Registration Statement is being effected agrees to furnish promptly to the
Company all information required to be disclosed in order to make the
information previously furnished to the Company by such Holder not misleading.
SECTION 5. Liquidated Damages. If (i) any of the Registration
Statements required by this Agreement is not filed with the Commission on or
prior to the date specified for such filing in this Agreement, (ii) any of
such Registration Statements has not been declared effective by the Commission
on or prior to the date specified for such effectiveness in this Agreement
(the "Effectiveness Target Date"), (iii) the Exchange Offer has not been
Consummated within 30 Business Days after the Effectiveness Target Date with
respect to the Exchange Offer Registration Statement or (iv) subject to
Section 6(c)(i), any Registration Statement required by this Agreement is
filed and declared effective but shall thereafter cease to be effective prior
to the time periods set forth in this Agreement or fail to be usable for its
intended purpose without being succeeded immediately by a post-effective
amendment to such Registration Statement that cures such failure and that is
itself immediately declared effective (each such event referred to in clauses
(i) through (iv), a "Registration Default"), the Company hereby agrees that
the interest rate borne by the Transfer Restricted Securities shall be
increased by 0.25% per annum during the 90-day period immediately following
the occurrence of any Registration Default and shall increase by an additional
0.25% per annum at the end of each subsequent 90-day period, but in
6
no event shall such increase exceed 1.00% per annum; provided that the Company
and the Guarantors shall in no event be required to pay such additional
interest for more than one Registration Default at any given time. Such
additional interest to be paid pursuant to a Registration Default is herein
referred to as "Liquidated Damages." Following the cure of any Registration
Default relating to any particular Transfer Restricted Securities, the
interest rate borne by the relevant Transfer Restricted Securities will be
reduced to the original interest rate borne by such Transfer Restricted
Securities; provided, however, that, if after any such reduction in interest
rate, a different Registration Default exists or occurs, the interest rate
borne by the relevant Transfer Restricted Securities shall again be increased
pursuant to the foregoing provisions unless and until the different
Registration Default has been cured.
All Liquidated Damages accrued pursuant to this Section 5 shall be
paid to the Holders entitled thereto, in the manner provided for the payment
of interest in the Indenture, on each Interest Payment Date, as more fully set
forth in the Indenture and the Notes. All obligations of the Company and the
Guarantors set forth in the preceding paragraph that are outstanding with
respect to any Transfer Restricted Security at the time such security ceases
to be a Transfer Restricted Security shall survive until such time as all such
obligations with respect to such Note shall have been satisfied in full.
SECTION 6. Registration Procedures.
(a) Exchange Offer Registration Statement. In connection with the
Exchange Offer, the Company and the Guarantors shall comply with all of the
provisions of Section 6(c) below, shall use their commercially reasonable
efforts to effect such exchange to permit the sale of Transfer Restricted
Securities being sold in accordance with the intended method or methods of
distribution thereof, and the Company, the Guarantors and the Holders of the
Notes, as applicable, shall comply with all of the following provisions:
(i) If in the reasonable opinion of counsel to the Company there
is a serious question as to whether the Exchange Offer is permitted
by applicable law, the Company and the Guarantors hereby agree to use
their commercially reasonable efforts to seek a no-action letter or
other favorable decision from the Commission allowing the Company and
the Guarantors to Consummate an Exchange Offer for such Initial
Notes. The Company and the Guarantors hereby agree to use their
commercially reasonable efforts to pursue the issuance of such a
decision to the Commission staff level, but shall not be required to
take commercially unreasonable action to effect a change of
Commission policy or otherwise obtain such no-action letter or other
favorable decision. The Company and the Guarantors hereby agree,
however, to (A) participate in telephonic conferences with the
Commission, (B) deliver to the Commission staff an analysis prepared
by counsel to the Company and the Guarantors setting forth the legal
bases, if any, upon which such counsel has concluded that such an
Exchange Offer should be permitted and (C) diligently pursue a
resolution (which need not be favorable) by the Commission staff of
such submission.
(ii) As a condition to its participation in the Exchange Offer
pursuant to the terms of this Agreement, each Holder of Transfer
Restricted Securities shall furnish, upon the request of the Company,
prior to the Consummation thereof, a written representation
7
to the Company and the Guarantors (which may be contained in the
letter of transmittal contemplated by the Exchange Offer Registration
Statement) to the effect that (A) it is not an affiliate of the
Company or the Guarantors, (B) it is not engaged in, and does not
intend to engage in, and has no arrangement or understanding with any
Person to participate in, a distribution of the Exchange Notes to be
issued in the Exchange Offer and (C) it is acquiring the Exchange
Notes in its ordinary course of business. In addition, all such
Holders of Transfer Restricted Securities shall otherwise cooperate
in the Company's preparations for the Exchange Offer. Each Holder
hereby acknowledges and agrees that any Broker-Dealer and any such
Holder using the Exchange Offer to participate in a distribution of
the securities to be acquired in the Exchange Offer (1) could not
under Commission policy as in effect on the date of this Agreement
rely on the position of the Commission enunciated in Morgan Stanley
and Co., Inc. (available June 5, 1991) and Exxon Capital Holdings
Corporation (available May 13, 1988), as interpreted in the
Commission's letter to Shearman & Sterling dated July 2, 1993, and
similar no-action letters (which may include any no-action letter
obtained pursuant to clause (i) above), and (2) must comply with the
registration and prospectus delivery requirements of the Securities
Act in connection with a secondary resale transaction and that such a
secondary resale transaction must be covered by an effective
registration statement containing the selling security holder
information required by Item 507 or 508, as applicable, of Regulation
S-K of the Securities Act if the resales are of Exchange Notes
obtained by such Holder in exchange for Initial Notes acquired by
such Holder directly from the Company.
(b) Shelf Registration Statement. In connection with the Shelf
Registration Statement, the Company and the Guarantors shall comply with all
the provisions of Section 6(c) below and shall use their commercially
reasonable efforts to effect such registration to permit the sale of the
Transfer Restricted Securities being sold in accordance with the intended
method or methods of distribution thereof, and pursuant thereto the Company
and the Guarantors will as soon as reasonably practicable prepare and file
with the Commission a Registration Statement relating to the registration on
any appropriate form under the Securities Act, which form shall be available
for the sale of the Transfer Restricted Securities in accordance with the
intended method or methods of distribution thereof.
(c) General Provisions. In connection with any Registration Statement
and any Prospectus required by this Agreement to permit the sale or resale of
Transfer Restricted Securities (including, without limitation, any
Registration Statement and the related Prospectus required to permit resales
of Transfer Restricted Securities by Broker-Dealers), the Company and the
Guarantors shall:
(i) use their commercially reasonable efforts to keep such
Registration Statement continuously effective and provide all
requisite financial statements (including, if required by the
Securities Act or any regulation thereunder, financial statements of
the Guarantors) for the period specified in Section 3 or 4 of this
Agreement, as applicable; upon the occurrence of any event that would
cause any such Registration Statement or the Prospectus contained
therein (A) to contain a material misstatement or omission or (B) not
to be effective and usable for resale of Transfer Restricted
Securities during the period required by this Agreement, the Company
and the Guarantors shall file promptly
8
an appropriate amendment to such Registration Statement, in the case
of clause (A), correcting any such misstatement or omission, and, in
the case of either clause (A) or (B), use their commercially
reasonable efforts to cause such amendment to be declared effective
as soon as practicable thereafter. Notwithstanding the foregoing, if
the Board of Directors of the Company determines in good faith that
it is in the best interests of the Company and the Guarantors not to
disclose the existence of or facts surrounding any proposed or
pending material corporate transaction or other material development
involving the Company or the Guarantors, the Company and the
Guarantors may allow any Shelf Registration Statement to fail to be
effective or the Prospectus contained therein to be unusable as a
result of such nondisclosure for up to 90 days in any year during the
two-year period of effectiveness required by Section 4 hereof;
(ii) use their commercially reasonable efforts to prepare and
file with the Commission such amendments and post-effective
amendments to the Registration Statement as may be necessary to keep
the Registration Statement effective for the applicable period set
forth in Section 3 or 4 hereof, as applicable, or such shorter period
as will terminate when all Transfer Restricted Securities covered by
such Registration Statement have been sold; cause the Prospectus to
be supplemented by any required Prospectus supplement, and as so
supplemented to be filed pursuant to Rule 424 under the Securities
Act, and to comply fully with the applicable provisions of Rules 424
and 430A under the Securities Act in a timely manner; and comply with
the provisions of the Securities Act with respect to the disposition
of all securities covered by such Registration Statement during the
applicable period in accordance with the intended method or methods
of distribution by the sellers thereof set forth in such Registration
Statement or supplement to the Prospectus;
(iii) advise the underwriter(s), if any, and selling Holders
promptly and, if requested by such Persons, to confirm such advice in
writing, (A) when the Prospectus or any Prospectus supplement or
post-effective amendment has been filed, and, with respect to any
Registration Statement or any post-effective amendment thereto, when
the same has become effective, (B) of any request by the Commission
for amendments to the Registration Statement or amendments or
supplements to the Prospectus or for additional information relating
thereto, (C) of the issuance by the Commission of any stop order
suspending the effectiveness of the Registration Statement under the
Securities Act or of the suspension by any state securities
commission of the qualification of the Transfer Restricted Securities
for offering or sale in any jurisdiction, or the initiation of any
proceeding for any of the preceding purposes or (D) of the existence
of any fact or the happening of any event that makes any statement of
a material fact made in the Registration Statement, the Prospectus,
any amendment or supplement thereto, or any document incorporated by
reference therein untrue, or that requires the making of any
additions to or changes in the Registration Statement or the
Prospectus in order to make the statements therein, in light of the
circumstances in which they were made, not misleading. If at any time
the Commission shall issue any stop order suspending the
effectiveness of the Registration Statement, or any state securities
commission or other regulatory authority shall issue an order
suspending the qualification or exemption from qualification of the
Transfer Restricted Securities under state securities or Blue Sky
laws,
9
the Company and the Guarantors shall use their commercially
reasonable efforts to obtain the withdrawal or lifting of such order
at the earliest possible time;
(iv) furnish without charge to each of the Initial Purchasers,
each selling Holder named in any Registration Statement, and each of
the underwriter(s), if any, before filing with the Commission, copies
of any Registration Statement or any Prospectus included therein or
any amendments or supplements to any such Registration Statement or
Prospectus (including all documents incorporated by reference after
the initial filing of such Registration Statement), which documents
will be subject to the review of such Holders and underwriter(s) in
connection with such sale, if any, and the Company and any Guarantors
will not file any such Registration Statement or Prospectus or any
amendment or supplement to any such Registration Statement or
Prospectus (including all such documents incorporated by reference)
to which an Initial Purchaser of Transfer Restricted Securities
covered by such Registration Statement or the underwriter(s), if any,
shall reasonably object in writing, with respect to any such
documents, other than a Current Report on Form 8-K, within five
Business Days, and with respect to any Current Report on Form 8-K,
within 24 hours, in each case, after the receipt thereof (any such
objection to be deemed timely made upon confirmation of telecopy
transmission within such period). The objection of an Initial
Purchaser or underwriter, if any, shall be deemed to be reasonable if
such Registration Statement, amendment, Prospectus or supplement, as
applicable, as proposed to be filed, contains a material misstatement
or omission;
(v) promptly prior to the filing of any document that is to be
incorporated by reference into a Registration Statement or
Prospectus, provide copies of such document to the Initial
Purchasers, each selling Holder named in any Registration Statement,
and to the underwriter(s), if any, make the Company's representatives
available and representatives of the Guarantors available for
discussion of such document and other customary due diligence
matters, and include such information in such document prior to the
filing thereof as such selling Holders or underwriter(s), if any,
reasonably may request;
(vi) make available at reasonable business hours in the offices
where such records are normally maintained for inspection by the
Initial Purchasers, any managing underwriter participating in any
disposition pursuant to such Registration Statement and any attorney
or accountant retained by such Initial Purchasers or any of the
underwriter(s), all relevant financial and other records, pertinent
corporate documents and documents relating to relevant properties of
the Company and the Guarantors subject to appropriate confidentiality
agreements and cause the Company's and the Guarantors' officers,
directors and employees to supply all information that is (a)
reasonably requested by any such Holder, underwriter, attorney or
accountant in connection with such Registration Statement subsequent
to the filing thereof and prior to its effectiveness and (b)
customarily furnished in transactions of the type contemplated by
such Registration Statement;
(vii) if requested by any selling Holders or the underwriter(s),
if any, promptly incorporate in any Registration Statement or
Prospectus, pursuant to a supplement or
10
post-effective amendment if necessary, such information as such
selling Holders and underwriter(s), if any, may reasonably request to
have included therein, including, without limitation, information
relating to the "Plan of Distribution" of the Transfer Restricted
Securities, information with respect to the principal amount of
Transfer Restricted Securities being sold to such underwriter(s), the
purchase price being paid therefor and any other terms of the
offering of the Transfer Restricted Securities to be sold in such
offering; and make all required filings of such Prospectus supplement
or post-effective amendment as soon as reasonably practicable after
the Company is notified of the matters to be incorporated in such
Prospectus supplement or post-effective amendment;
(viii) furnish to each selling Holder and each of the
underwriter(s), if any, without charge, at least one copy of the
Registration Statement, as first filed with the Commission, and of
each amendment thereto, including financial statements and schedules,
all documents incorporated by reference therein and all exhibits
(including exhibits incorporated therein by reference);
(ix) deliver to each selling Holder and each of the
underwriter(s), if any, without charge, as many copies of the
Prospectus (including each preliminary prospectus) and any amendment
or supplement thereto as such Persons reasonably may request; the
Company and the Guarantors hereby consent to the use (in accordance
with law) of the Prospectus and any amendment or supplement thereto
by each of the selling Holders and each of the underwriter(s), if
any, in connection with the offering and the sale of the Transfer
Restricted Securities covered by the Prospectus or any amendment or
supplement thereto;
(x) enter into, and cause the Guarantors to enter into, such
agreements (including an underwriting agreement containing customary
terms), and make, and cause the Guarantors to make, such
representations and warranties, and take all such other actions in
connection therewith in order to expedite or facilitate the
disposition of the Transfer Restricted Securities pursuant to any
Registration Statement contemplated by this Agreement, all to such
extent as may be reasonably requested by any Initial Purchaser or by
any Holder of Transfer Restricted Securities or underwriter in
connection with any sale or resale pursuant to any Registration
Statement contemplated by this Agreement;
(xi) in the case of a Shelf Registration Statement, the Company
and the Guarantors shall:
(A) furnish (or in the case of paragraph (2) and (3)
below, use their commercially reasonable efforts to cause to be
furnished) to each Initial Purchaser, each selling Holder and
each underwriter, if any, in such substance and scope as are
customarily made, in the case of an Underwritten Offering, by
issuers to underwriters in primary underwritten offerings, upon
the date of effectiveness of the Shelf Registration Statement
and in the case of an Underwritten Offering, upon the date of
the underwriting agreement (except in the case of paragraphs (1)
and (2)) and the date of closing:
11
(1) a certificate, signed by (y) the President or
any Vice President and (z) a principal financial or
accounting officer of each of the Company and the
Guarantors, confirming, as of the date thereof, the
matters, to the extent applicable, set forth in paragraphs
(i), (ii) and (iii) of Section 5(f) of the Purchase
Agreement;
(2) an opinion, of counsel for the Company and the
Guarantors, covering the matters in the opinions delivered
pursuant to Section 5(c) of the Purchase Agreement and in
any event including a statement to the effect that such
counsel has participated in conferences with officers and
other representatives of the Company and the Guarantors,
representatives of the independent public accountants for
the Company and the Guarantors, the Initial Purchasers'
representatives and the Initial Purchasers' counsel in
connection with the preparation of such Shelf Registration
Statement and the related Prospectus and have considered
the matters required to be stated therein and the
statements contained therein, although such counsel has
not independently verified the accuracy, completeness or
fairness of such statements; and that such counsel advises
that, on the basis of the foregoing (relying as to
materiality to the extent such counsel deems appropriate
upon the statements of officers and other representatives
of the Company and the Guarantors and without independent
check or verification), no facts came to such counsel's
attention that caused such counsel to believe that the
applicable Shelf Registration Statement, at the time such
Shelf Registration Statement or any post-effective
amendment thereto became effective, and in the case of an
Underwritten Offering, at the date of the underwriting
agreement, contained an untrue statement of a material
fact or omitted to state a material fact required to be
stated therein or necessary to make the statements therein
not misleading, or that the Prospectus contained in such
Shelf Registration Statement as of its date and in the
case of an Underwritten Offering, at the date of the
underwriting agreement and the date of closing contained
an untrue statement of a material fact or omitted to state
a material fact necessary in order to make the statements
therein, in light of the circumstances under which they
were made, not misleading. Without limiting the foregoing,
such counsel may state further that such counsel assumes
no responsibility for, and has not independently verified,
the accuracy, completeness or fairness of the financial
statements, notes and schedules and other financial data
included in any Shelf Registration Statement contemplated
by this Agreement or the related Prospectus; and
(3) a customary comfort letter, from (i) the
Company's independent accountants and (ii) the independent
accountants of any other Person for which financial
statements are included in or incorporated by reference
into any Shelf Registration Statement contemplated by this
Agreement or the related Prospectus, in the
12
customary form and covering matters of the type
customarily covered in comfort letters to underwriters in
connection with primary underwritten offerings, and
affirming the matters set forth in the comfort letters
delivered pursuant to Section 5(a) of the Purchase
Agreement, without exception;
(B) in the case of an Underwritten Offering, set forth in
full or incorporate by reference in the underwriting agreement,
if any, the indemnification provisions and procedures of Section
8 hereof with respect to all parties to be indemnified pursuant
to said Section; and
(C) in the case of an Underwritten Offering, deliver such
other documents and certificates as may be reasonably requested
by such parties to evidence compliance with clause (A) above and
with any customary conditions contained in the underwriting
agreement or other customary agreement entered into by the
Company or the Guarantors pursuant to clause (x).
If at any time the representations and warranties of the Company
and the Guarantors contemplated in clause (A)(1) above cease to be
true and correct, the Company shall so advise the Initial Purchasers
and the underwriter(s), if any, and each selling Holder promptly and,
if requested by such Persons, shall confirm such advice in writing;
(xii) prior to any public offering of Transfer Restricted
Securities, cooperate with, and cause the Guarantors to cooperate
with, the selling Holders, the underwriter(s), if any, and their
respective counsel in connection with the registration and
qualification of the Transfer Restricted Securities under the
securities or Blue Sky laws of such jurisdictions as the selling
Holders or underwriter(s) may request and do any and all other acts
or things necessary or advisable to enable the disposition in such
jurisdictions of the Transfer Restricted Securities covered by the
Shelf Registration Statement; provided, however, that neither the
Company nor any Guarantor shall be required to register or qualify as
a foreign corporation where it is not then so qualified or to take
any action that would subject it to the service of process in suits
or to taxation, other than as to matters and transactions relating to
the Registration Statement, in any jurisdiction where it is not then
so subject;
(xiii) issue, upon the request of any Holder of Initial Notes
covered by the Shelf Registration Statement, Exchange Notes, having
an aggregate principal amount equal to the aggregate principal amount
of Initial Notes surrendered to the Company by such Holder in
exchange therefor or being sold by such Holder; such Exchange Notes
to be registered in the name of such Holder or in the name of the
purchaser(s) of such Notes, as the case may be; in return, the
Initial Notes held by such Holder shall be surrendered to the Company
for cancellation;
(xiv) cooperate with, and cause the Guarantors to cooperate
with, the selling Holders and the underwriter(s), if any, to
facilitate the timely preparation and delivery of certificates
representing Transfer Restricted Securities to be sold and not
bearing any
13
restrictive legends; and enable such Transfer Restricted Securities
to be in such denominations and registered in such names as the
Holders or the underwriter(s), if any, may request at least two
Business Days prior to any sale of Transfer Restricted Securities
made by such underwriter(s);
(xv) use their commercially reasonable efforts to cause the
Transfer Restricted Securities covered by the Registration Statement
to be registered with or approved by such other governmental agencies
or authorities as may be necessary to enable the seller or sellers
thereof or the underwriter(s), if any, to consummate the disposition
of such Transfer Restricted Securities, subject to the proviso
contained in clause (xii) above;
(xvi) subject to Section 6(c)(i), if any fact or event
contemplated by clause (c)(iii)(D) above shall exist or have
occurred, prepare a supplement or post-effective amendment to the
Registration Statement or related Prospectus or any document
incorporated therein by reference or file any other required document
so that, as thereafter delivered to the purchasers of Transfer
Restricted Securities, the Prospectus will not contain an untrue
statement of a material fact or omit to state any material fact
necessary to make the statements therein not misleading;
(xvii) provide a CUSIP number for all Transfer Restricted
Securities not later than the effective date of the Registration
Statement and provide the Trustee under the Indenture with printed
certificates for the Transfer Restricted Securities which are in a
form eligible for deposit with the Depositary Trust Company;
(xviii) in the case of an Underwritten Offering, cooperate and
assist in any filings required to be made with the NASD and in the
performance of any due diligence investigation by any underwriter
(including any "qualified independent underwriter") that is required
to be retained in accordance with the rules and regulations of the
NASD, and use their reasonable best efforts to cause such
Registration Statement to become effective and approved by such
governmental agencies or authorities as may be necessary to enable
the Holders selling Transfer Restricted Securities to consummate the
disposition of such Transfer Restricted Securities;
(xix) otherwise use their commercially reasonable efforts to
comply with all applicable rules and regulations of the Commission,
and make generally available to its security holders, as soon as
reasonably practicable, a consolidated earnings statement meeting the
requirements of Rule 158 under the Securities Act (which need not be
audited) for the twelve-month period (A) commencing at the end of any
fiscal quarter in which Transfer Restricted Securities are sold to
underwriters in a firm or best efforts Underwritten Offering or (B)
if not sold to underwriters in such an offering, beginning with the
first month of the Company's first fiscal quarter commencing after
the effective date of the Registration Statement;
(xx) cause the Indenture to be qualified under the Trust
Indenture Act not later than the effective date of the first
Registration Statement required by this Agreement, and, in connection
therewith, cooperate, and cause the Guarantors to cooperate with, the
Trustee and the Holders of Notes to effect such changes to the
Indenture as may be
14
required for such Indenture to be so qualified in accordance with the
terms of the Trust Indenture Act; and to execute, and cause the
Guarantors to execute, and use their commercially reasonable efforts
to cause the Trustee to execute, all documents that may be required
to effect such changes and all other forms and documents required to
be filed with the Commission to enable such Indenture to be so
qualified in a timely manner;
(xxi) cause all Transfer Restricted Securities covered by the
Registration Statement to be listed on each securities exchange on
which securities of the same class issued by the Company and the
Guarantors are then listed if requested by the Holders of a majority
in aggregate principal amount of Initial Notes or the managing
underwriter(s), if any; and
(xxii) provide promptly to each Holder upon request each
document filed with the Commission pursuant to the requirements of
Section 13 or Section 15(d) of the Exchange Act.
Each Holder agrees by acquisition of a Transfer Restricted Security
that, upon receipt of any notice referred to in Section 6(c)(iii)(C) or any
notice from the Company of the existence of any fact of the kind described in
Section 6(c)(iii)(D) hereof (in each case, a "Suspension Notice"), such Holder
will forthwith discontinue disposition of Transfer Restricted Securities
pursuant to the applicable Registration Statement until such Holder's receipt
of the copies of the supplemented or amended Prospectus contemplated by
Section 6(c)(xvi) hereof, or until it is advised in writing (the "Advice") by
the Company that the use of the Prospectus may be resumed, and has received
copies of any additional or supplemental filings that are incorporated by
reference in the Prospectus. Each Holder receiving a Suspension Notice hereby
agrees that it will either (i) destroy any Prospectuses, other than permanent
file copies, then in such Holder's possession which have been replaced by the
Company with more recently dated Prospectuses or (ii) if so directed by the
Company, deliver to the Company (at the Company's expense) all copies, other
than permanent file copies then in such Holder's possession, of the Prospectus
covering such Transfer Restricted Securities that was current at the time of
receipt of such Suspension Notice. In the event the Company shall give any
such notice, the time period regarding the effectiveness of such Registration
Statement set forth in Section 3 or 4 hereof, as applicable, shall be extended
by the number of days in the period from and including the date of the
delivery of the Suspension Notice to and including the date when each selling
Holder covered by such Registration Statement shall have received the copies
of the supplemented or amended Prospectus contemplated by Section 6(c)(xvi)
hereof or shall have received the Advice; however, no such extension shall be
taken into account in determining whether Liquidated Damages are due pursuant
to Section 5 hereof or the amount of such Liquidated Damages, it being agreed
that the Company's option to suspend use of a Registration Statement pursuant
to this paragraph shall be treated as a Registration Default for purposes of
Section 5.
SECTION 7. Registration Expenses.
(a) All expenses incident to the Company's or the Guarantors'
performance of or compliance with this Agreement will be borne by the Company
or the Guarantors, regardless of whether a Registration Statement becomes
effective, including without limitation: (i) all registration and filing fees
and expenses (including filings made by any Initial Purchaser or
15
Holder with the NASD (and, if applicable, the fees and expenses of any
"qualified independent underwriter" and its counsel that may be required by
the rules and regulations of the NASD)); (ii) all fees and expenses of
compliance with federal securities and state Blue Sky or securities laws;
(iii) all expenses of printing (including printing certificates for the
Exchange Notes to be issued in the Exchange Offer and printing of
Prospectuses), messenger and delivery services and telephone; (iv) all fees
and disbursements of counsel for the Company, the Guarantors and, subject to
Section 7(b) below, the Holders of Transfer Restricted Securities; (v) all
application and filing fees in connection with listing the Exchange Notes on a
national securities exchange or automated quotation system pursuant to the
requirements thereof; and (vi) all fees and disbursements of independent
certified public accountants of the Company, the Guarantors or other Person
(including the expenses of any special audit and comfort letters required by
or incident to such performance).
The Company and the Guarantors will, in any event, bear their
internal expenses (including, without limitation, all salaries and expenses of
its officers and employees performing legal or accounting duties), the
expenses of any annual audit and the fees and expenses of any Person,
including special experts, retained by the Company and the Guarantors.
(b) In connection with any Registration Statement required by this
Agreement (including, without limitation, the Exchange Offer Registration
Statement and the Shelf Registration Statement, if any), the Company and the
Guarantors will reimburse the Initial Purchasers and the Holders of Transfer
Restricted Securities being tendered in the Exchange Offer and/or resold
pursuant to the "Plan of Distribution" contained in the Exchange Offer
Registration Statement or registered pursuant to the Shelf Registration
Statement, as applicable, for the reasonable fees and disbursements of not
more than one counsel, who shall be Shearman & Sterling LLP or such other
counsel as may be chosen by the Holders of a majority in principal amount of
the Transfer Restricted Securities for whose benefit such Registration
Statement is being prepared.
SECTION 8. Indemnification.
(a) The Company agrees and the Guarantors, jointly and severally,
agree to indemnify and hold harmless (i) each Holder and (ii) each Person, if
any, who controls (within the meaning of Section 15 of the Securities Act or
Section 20 of the Exchange Act) any Holder (any of the Persons referred to in
this clause (ii) being hereinafter referred to as a "Controlling Person") and
(iii) the respective officers, directors, partners, employees, representatives
and agents of any Holder or any Controlling Person (any person referred to in
clause (i), (ii) or (iii) may hereinafter be referred to as an "Indemnified
Holder"), to the fullest extent lawful, from and against any and all losses,
claims, damages, liabilities or expenses (including without limitation,
reimbursement of all costs reasonably incurred in investigating, preparing,
pursuing, settling, compromising, paying or defending any claim or action, or
any investigation or proceeding by any governmental agency or body, commenced
or threatened, including the reasonable fees and expenses of counsel to any
Indemnified Holder), caused by, related to, based upon, arising out of or in
connection with any untrue statement or alleged untrue statement of a material
fact contained in any Registration Statement or Prospectus (or any amendment
or supplement thereto), or any omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the
statements therein not misleading, except insofar as such losses, claims,
damages, liabilities or expenses are caused by, based upon, arising out of or
in connection with
16
an untrue statement or omission or alleged untrue statement or omission that
is made in reliance upon and in conformity with information relating to any
Indemnified Holder furnished in writing to the Company by any of the Holders,
or on their behalf, expressly for use therein. This indemnity agreement shall
be in addition to any liability which the Company may otherwise have.
In case any action or proceeding (including any governmental or
regulatory investigation or proceeding) shall be brought against any of the
Indemnified Holders with respect to which indemnity may be sought against the
Company or the Guarantors, such Indemnified Holder (or the Indemnified Holder
controlled by such Controlling Person) shall promptly notify the Company and
the Guarantors in writing (provided, that the failure to give such notice
shall not relieve the Company or the Guarantors of their respective
obligations pursuant to this Agreement unless prejudiced thereby). In case any
such action is brought against any Indemnified Holder and such Indemnified
Holder seeks or intends to seek indemnity from the Company and the Guarantors,
the Company and the Guarantors will be entitled to participate in and, to the
extent that they shall elect by written notice delivered to the Indemnified
Holder promptly after receiving the aforesaid notice from such Indemnified
Holder, to assume the defense thereof with counsel reasonably satisfactory to
such Indemnified Holder; provided, however, if the defendants in any such
action include both the Indemnified Holder and the Company or any Guarantor
and the Indemnified Holder shall have reasonably concluded that a conflict may
arise between the positions of the Company or any Guarantor and the
Indemnified Holder in conducting the defense of any such action or that there
may be legal defenses available to it which are different from or additional
to those available to the Company or any Guarantor, the Indemnified Holder
shall have the right to select separate counsel to assume such legal defenses
and to otherwise participate in the defense of such action on behalf of
itself. Upon receipt of notice from the Company or any Guarantor to such
Indemnified Holder of the Company or any Guarantor's election so to assume the
defense of such action and approval by the Indemnified Holder of counsel, the
Company or any Guarantor will not be liable to such Indemnified Holder under
this Section 8 for any legal or other expenses subsequently incurred by such
Indemnified Holder in connection with the defense thereof unless (i) the
Indemnified Holder shall have employed separate counsel in accordance with the
proviso to the second sentence of this paragraph (it being understood,
however, that the Company or any Guarantor shall not be liable for the
expenses of more than one separate counsel (together with local counsel,
approved by the Company or any Guarantor, representing the Indemnified Holder
who is a party to such action) or (ii) the Company or any Guarantor shall not
have employed counsel reasonably satisfactory to the Indemnified Holder to
represent the Indemnified Holder within a reasonable time after notice of
commencement of the action, in each of which cases the fees and expenses of
counsel shall be at the expense of the Company and the Guarantor.
The Company and the Guarantors shall be liable for any settlement of
any such action or proceeding effected with the Company's prior written
consent, which consent shall not be withheld unreasonably, and the Company and
the Guarantors agree to indemnify and hold harmless any Indemnified Holder
from and against any loss, claim, damage, liability or expense by reason of
any settlement of any action effected with the written consent of the Company.
The Company and the Guarantors shall not, without the prior written consent of
each Indemnified Holder, settle or compromise or consent to the entry of
judgment in or otherwise seek to terminate any pending or threatened action,
claim, litigation or proceeding in respect of which
17
indemnification or contribution may be sought hereunder (whether or not any
Indemnified Holder is a party thereto), unless such settlement, compromise,
consent or termination (i) includes an unconditional release of each
Indemnified Holder from all liability arising out of such action, claim,
litigation or proceeding and (ii) does not include a statement as to, or an
admission of, fault, culpability or a failure to act, by or on behalf of the
Indemnified Holder.
(b) Each Holder of Transfer Restricted Securities agrees, severally
and not jointly, to indemnify and hold harmless the Company and the Guarantors
and their respective directors, officers, and each person controlling (within
the meaning of Section 15 of the Securities Act or Section 20 of the Exchange
Act) the Company, the Guarantors and the respective officers, directors,
partners, employees, representatives and agents of each such person, to the
same extent as the indemnity from the Company and the Guarantors to each of
the Indemnified Holders set forth in Section 8(a), but only with respect to
claims and actions based on information relating to such Holder furnished in
writing by such Holder, or on their behalf, expressly for use in any
Registration Statement. In case any action or proceeding shall be brought
against the Company, the Guarantors or their directors or officers or any such
Controlling Person in respect of which indemnity may be sought against a
Holder of Transfer Restricted Securities, such Holder shall have the rights
and duties given the Company and/or the Guarantors and the Company, the
Guarantors or their directors or officers or such Controlling Person shall
have the rights and duties given to each Holder by Section 8(a).
(c) If the indemnification provided for in this Section 8 is
unavailable to an indemnified party under Section 8(a) or Section 8(b) (other
than by reason of exceptions provided in those Sections) in respect of any
losses, claims, damages, liabilities or expenses referred to therein, then
each applicable indemnifying party, in lieu of indemnifying such indemnified
party, shall contribute to the amount paid or payable by such indemnified
party as a result of such losses, claims, damages, liabilities or expenses in
such proportion as is appropriate to reflect the relative benefits received by
the Company and the Guarantors, on the one hand, and the Holders, on the other
hand, from the Initial Placement (which in the case of the Company and the
Guarantors shall be deemed to be equal to the total gross proceeds from the
Initial Placement as set forth on the cover page of the Offering Memorandum,
less any discount received by the Initial Purchasers in the Initial
Placement), the amount of Liquidated Damages which does not become payable as
a result of the filing of the Registration Statement resulting in such losses,
claims, damages, liabilities or expenses, and such Registration Statement, or
if such allocation is not permitted by applicable law, the relative fault of
the Company and the Guarantors on the one hand, and of the Indemnified Holder,
on the other hand, in connection with the statements or omissions which
resulted in such losses, claims, damages, liabilities or expenses, as well as
any other relevant equitable considerations. The relative fault of the Company
on the one hand and of the Indemnified Holder on the other shall be determined
by reference to, among other things, whether the untrue or alleged untrue
statement of a material fact or the omission or alleged omission to state a
material fact relates to information supplied by the Company or by the
Indemnified Holder and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or omission.
The amount paid or payable by a party as a result of the losses, claims,
damages, liabilities and expenses referred to above shall be deemed to
include, subject to the limitations set forth in the second paragraph of
Section 8(a), any legal or other fees or expenses reasonably incurred by such
party in connection with investigating or defending any action or claim.
18
The Company, the Guarantors and each Holder of Transfer Restricted
Securities agree that it would not be just and equitable if contribution
pursuant to this Section 8(c) were determined by pro rata allocation (even if
the Holders were treated as one entity for such purpose) or by any other
method of allocation which does not take account of the equitable
considerations referred to in the immediately preceding paragraph. The amount
paid or payable by an indemnified party as a result of the losses, claims,
damages, liabilities or expenses referred to in the immediately preceding
paragraph shall be deemed to include, subject to the limitations set forth
above, any legal or other expenses reasonably incurred by such indemnified
party in connection with investigating or defending any such action or claim.
Notwithstanding the other provisions of this Section 8, no Holder (and its
related Indemnified Holders) shall be liable, in the aggregate, for any amount
in excess of the discount granted or the commission paid by the Company as set
forth in the Purchase Agreement with respect to the Initial Notes held by such
Holder, or in the case of a Holder of Exchange Notes, the Initial Notes
exchanged for such Exchange Notes. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. The Holders' obligations to contribute pursuant
to this Section 8(c) are several in proportion to the respective principal
amount of Initial Notes held by each of the Holders hereunder and not joint.
SECTION 9. Rule 144A. The Company and the Guarantors each hereby
agrees with each Holder, for so long as any Transfer Restricted Securities
remain outstanding, to make available to any Holder or beneficial owner of
Transfer Restricted Securities in connection with any sale thereof and any
prospective purchaser of such Transfer Restricted Securities from such Holder
or beneficial owner, the information required by Rule 144A(d)(4) under the
Securities Act in order to permit resales of such Transfer Restricted
Securities pursuant to Rule 144A.
SECTION 10. Participation in Underwritten Registrations. No Holder
may participate in any Underwritten Registration hereunder unless such Holder
(a) agrees to sell such Holder's Transfer Restricted Securities on the basis
provided in a customary underwriting agreement entered into in connection
herewith and (b) completes and executes all reasonable questionnaires, powers
of attorney, indemnities, underwriting agreements, lock-up letters and other
documents required under the terms of such underwriting arrangements.
SECTION 11. Selection of Underwriters. The Holders of Transfer
Restricted Securities covered by the Shelf Registration Statement who desire
to do so may sell such Transfer Restricted Securities in an Underwritten
Offering. In any such Underwritten Offering, the investment banker or
investment bankers and manager or managers that will administer the offering
will be selected by the Holders of a majority in aggregate principal amount of
the Transfer Restricted Securities included in such offering; provided, that
such investment bankers and managers must be reasonably satisfactory to the
Company.
SECTION 12. Miscellaneous.
(a) Remedies. The Company and the Guarantors each hereby agrees that
monetary damages would not be adequate compensation for any loss incurred by
reason of a breach by it of the provisions of this Agreement and hereby agree
to waive the defense in any action for specific performance that a remedy at
law would be adequate.
19
(b) No Inconsistent Agreements. The Company will not, and will cause
the Guarantors not to, on or after the date of this Agreement enter into any
agreement with respect to its securities that is inconsistent with the rights
granted to the Holders in this Agreement or otherwise conflicts with the
provisions hereof. The rights granted to the Holders hereunder do not in any
way conflict with and are not inconsistent with the rights granted to the
holders of the Company's securities under any agreement in effect on the date
hereof.
(c) Adjustments Affecting the Notes. The Company and the Guarantors
will not take any action, or permit any change to occur, with respect to the
Notes that would materially and adversely affect the ability of the Holders to
Consummate any Exchange Offer.
(d) Amendments and Waivers. The provisions of this Agreement may not
be amended, modified or supplemented, and waivers or consents to or departures
from the provisions hereof may not be given unless the Company has obtained
the written consent of Holders of a majority of the outstanding principal
amount of Transfer Restricted Securities. Notwithstanding the foregoing, a
waiver or consent to departure from the provisions hereof that relates
exclusively to the rights of Holders whose securities are being tendered
pursuant to the Exchange Offer and that does not affect directly or indirectly
the rights of other Holders whose securities are not being tendered pursuant
to such Exchange Offer may be given by the Holders of a majority of the
outstanding principal amount of Transfer Restricted Securities being tendered
or registered; provided that, with respect to any matter that directly or
indirectly affects the rights of any Initial Purchaser hereunder, the Company
shall obtain the written consent of each such Initial Purchaser with respect
to which such amendment, qualification, supplement, waiver, consent or
departure is to be effective.
(e) Notices. All notices and other communications provided for or
permitted hereunder shall be made in writing by hand-delivery, first-class
mail (registered or certified, return receipt requested), telex, telecopier,
or air courier guaranteeing overnight delivery:
(i) if to a Holder, at the address set forth on the records of
the Registrar under the Indenture, with a copy to the Registrar under
the Indenture; and
(ii) if to the Company:
Rayovac Corporation
6 Concourse Parkway, Suite 3300
Atlanta, GA 30328
Facsimile: (770) 829-6298
Attention: General Counsel
With a copy to:
Skadden, Arps, Slate, Meagher & Flom LLP
One Beacon Street, 31st Floor
Boston, MA 02108
20
Telecopier No.: (617) 573-4822
Attention: Margaret Brown
All such notices and communications shall be deemed to have been duly
given: at the time delivered by hand, if personally delivered; five Business
Days after being deposited in the mail, postage prepaid, if mailed; when
answered back, if telexed; when receipt acknowledged, if telecopied; and on
the next Business Day, if timely delivered to an air courier guaranteeing
overnight delivery.
Copies of all such notices, demands or other communications shall be
concurrently delivered by the Person giving the same to the Trustee at the
address specified in the Indenture.
(f) Successors and Assigns. This Agreement shall inure to the benefit
of and be binding upon the successors and assigns of each of the parties,
including without limitation and without the need for an express assignment,
subsequent Holders of Transfer Restricted Securities; provided, however, that
this Agreement shall not inure to the benefit of or be binding upon a
successor or assign of a Holder unless and to the extent such successor or
assign acquired Transfer Restricted Securities from such Holder.
(g) Counterparts. This Agreement may be executed in any number of
counterparts and by the parties hereto in separate counterparts, each of which
when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement.
(h) Headings. The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof.
(i) Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO THE
CONFLICT OF LAW RULES THEREOF.
(j) Severability. In the event that any one or more of the provisions
contained herein, or the application thereof in any circumstance, is held
invalid, illegal or unenforceable, the validity, legality and enforceability
of any such provision in every other respect and of the remaining provisions
contained herein shall not be affected or impaired thereby.
(k) Entire Agreement. This Agreement is intended by the parties as a
final expression of their agreement and intended to be a complete and
exclusive statement of the agreement and understanding of the parties hereto
in respect of the subject matter contained herein. There are no restrictions,
promises, warranties or undertakings, other than those set forth or referred
to herein with respect to the registration rights granted by the Company with
respect to the Transfer Restricted Securities. This Agreement supersedes all
prior agreements and understandings between the parties with respect to such
subject matter.
21
IN WITNESS WHEREOF, the parties have executed this Agreement as of
the date first written above.
RAYOVAC CORPORATION
By: /s/ James T. Lucke
-----------------------------------------
Name: James T. Lucke
Title: Senior Vice President -
General Counsel and Secretary
ROV HOLDING, INC.
By: /s/ James T. Lucke
-----------------------------------------
Name: James T. Lucke
Title: Secretary
ROVCAL, INC.
By: /s/ James T. Lucke
-----------------------------------------
Name: James T. Lucke
Title: Secretary
UNITED INDUSTRIES CORPORATION
By: /s/ Louis N. Laderman
-----------------------------------------
Name: Louis N. Laderman
Title: Vice President, Secretary and
General Counsel
SCHULTZ COMPANY
By: /s/ Louis N. Laderman
-----------------------------------------
Name: Louis N. Laderman
Title: Vice President and Secretary
22
WPC BRANDS, INC.
By: /s/ Louis N. Laderman
-----------------------------------------
Name: Louis N. Laderman
Title: Vice President and Secretary
SYLORR PLANT CORP.
By: /s/ Louis N. Laderman
-----------------------------------------
Name: Louis N. Laderman
Title: Vice President and Secretary
GROUND ZERO, INC.
By: /s/ Louis N. Laderman
-----------------------------------------
Name: Louis N. Laderman
Title: Vice President and Secretary
NU-GRO US HOLDCO CORPORATION
By: /s/ Louis N. Laderman
-----------------------------------------
Name: Louis N. Laderman
Title: Secretary
NU-GRO AMERICA CORP.
By: /s/ Louis N. Laderman
-----------------------------------------
Name: Louis N. Laderman
Title: Vice President and Secretary
23
IB NITROGEN INC.
By: /s/ Louis N. Laderman
-----------------------------------------
Name: Louis N. Laderman
Title: Vice President and Secretary
NU-GRO TECHNOLOGIES, INC.
By: /s/ Louis N. Laderman
-----------------------------------------
Name: Louis N. Laderman
Title: Vice President and Secretary
UNITED PET GROUP, INC.
By: /s/ Louis N. Laderman
-----------------------------------------
Name: Louis N. Laderman
Title: Vice President and Secretary
DB ONLINE, LLC
By: /s/ Louis N. Laderman
-----------------------------------------
Name: Louis N. Laderman
Title: Vice President and Secretary
SOUTHERN CALIFORNIA FOAM, INC.
By: /s/ Louis N. Laderman
-----------------------------------------
Name: Louis N. Laderman
Title: Vice President and Secretary
24
AQ HOLDINGS, INC.
By: /s/ Louis N. Laderman
-----------------------------------------
Name: Louis N. Laderman
Title: Vice President and Secretary
AQUARIA, INC.
By: /s/ Louis N. Laderman
-----------------------------------------
Name: Louis N. Laderman
Title: Vice President and Secretary
PERFECTO HOLDING CORP.
By: /s/ Louis N. Laderman
-----------------------------------------
Name: Louis N. Laderman
Title: Vice President and Secretary
AQUARIUM SYSTEMS, INC.
By: /s/ Louis N. Laderman
-----------------------------------------
Name: Louis N. Laderman
Title: Vice President and Secretary
PERFECTO MANUFACTURING, INC.
By: /s/ Louis N. Laderman
-----------------------------------------
Name: Louis N. Laderman
Title: Vice President and Secretary
25
JUNGLE TALK INTERNATIONAL, INC.
By: /s/ Louis N. Laderman
-----------------------------------------
Name: Louis N. Laderman
Title: Vice President and Secretary
PETS `N PEOPLE, INC.
By: /s/ Louis N. Laderman
-----------------------------------------
Name: Louis N. Laderman
Title: Vice President and Secretary
26
The foregoing Registration Rights Agreement is hereby confirmed and
accepted as of the date first above written:
BANC OF AMERICA SECURITIES LLC
CITIGROUP GLOBAL MARKETS INC.
MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED
ABN AMRO INCORPORATED
By: Banc of America Securities LLC
By: /s/ Douglas M. Ingram
--------------------------------
Douglas M. Ingram
Managing Director
27
SCHEDULE A
Guarantor Jurisdiction of Incorporation
- --------- -----------------------------
ROV Holding, Inc. Delaware
Rovcal, Inc. California
United Industries Corporation Delaware
Schultz Company Missouri
WPC Brands, Inc. Wisconsin
Sylorr Plant Corp. Delaware
Ground Zero, Inc. Missouri
Nu-Gro US Holdco Corporation Delaware
Nu-Gro America Corp. Delaware
IB Nitrogen Inc. Delaware
Nu-Gro Technologies, Inc. Delaware
United Pet Group, Inc. Delaware
DB Online, LLC Hawaii
Southern California Foam, Inc. California
AQ Holdings, Inc. Delaware
Aquaria, Inc. California
Perfecto Holding Corp. Delaware
Aquarium Systems, Inc. Delaware
Perfecto Manufacturing, Inc. Delaware
Jungle Talk International, Inc. Delaware
Pets `N People, Inc. Delaware
EXHIBIT 10.1
===============================================================================
Published CUSIP Number: ____
FOURTH AMENDED AND RESTATED CREDIT AGREEMENT
Dated as of February 7, 2005
among
RAYOVAC CORPORATION,
as the U.S. Borrower,
the Subsidiary Borrowers named herein,
BANK OF AMERICA, N.A.,
as Administrative Agent, Swing Line Lender and L/C Issuer,
CITICORP NORTH AMERICA, INC.,
as Syndication Agent,
MERRILL LYNCH CAPITAL CORPORATION,
as Documentation Agent and as Managing Agent,
The Other Lenders Party Hereto,
BANC OF AMERICA SECURITIES LLC and CITIGROUP GLOBAL MARKETS INC.,
as Joint Lead Arrangers
and
BANC OF AMERICA SECURITIES LLC, CITIGROUP GLOBAL MARKETS INC. and
MERRILL LYNCH, PIERCE, FENNER & SMITH,
as Joint Book Managers
===============================================================================
TABLE OF CONTENTS
Section Page
- ------- ----
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
1.01 Defined Terms........................................................1
1.02 Other Interpretive Provisions.......................................49
1.03 Accounting Terms....................................................50
1.04 Rounding............................................................50
1.05 Times of Day........................................................50
1.06 Letter of Credit Amounts............................................50
1.07 Currency Equivalents Generally......................................50
ARTICLE II
the COMMITMENTS and Credit Extensions
2.01 The Loans...........................................................51
2.02 Borrowings, Conversions and Continuations of Loans..................52
2.03 Dollar Letters of Credit............................................55
2.04 Euro Letters of Credit..............................................66
2.05 UK Letters of Credit................................................75
2.06 Swing Line Loans....................................................84
2.07 Prepayments.........................................................89
2.08 Termination or Reduction of Commitments.............................93
2.09 Repayment of Loans..................................................95
2.10 Interest............................................................97
2.11 Fees................................................................98
2.12 Computation of Interest and Fees....................................99
2.13 Evidence of Indebtedness............................................99
2.14 Payments Generally; Administrative Agent's Clawback................100
2.15 Sharing of Payments by Lenders.....................................102
2.16 Incremental Facility...............................................103
ARTICLE III
TAXES, YIELD PROTECTION AND ILLEGALITY
3.01 Taxes..............................................................106
3.02 Illegality.........................................................109
3.03 Inability to Determine Rates.......................................109
3.04 Increased Costs; Reserves on Eurocurrency Rate Loans...............109
3.05 Compensation for Losses............................................111
3.06 Mitigation Obligations; Replacement of Lenders.....................111
3.07 Survival...........................................................112
i
ARTICLE IV
CONDITIONS PRECEDENT TO Credit Extensions
4.01 Conditions of Initial Credit Extension.............................112
4.02 Conditions to all Credit Extensions................................116
ARTICLE V
REPRESENTATIONS AND WARRANTIES
5.01 Existence, Qualification and Power; Compliance with Laws...........117
5.02 Authorization; No Contravention....................................117
5.03 Governmental Authorization; Other Consents.........................118
5.04 Binding Effect.....................................................118
5.05 Financial Statements; No Material Adverse Effect...................118
5.06 Litigation.........................................................119
5.07 No Default.........................................................119
5.08 Ownership of Property..............................................119
5.09 Environmental Compliance...........................................120
5.10 Insurance..........................................................121
5.11 Taxes..............................................................121
5.12 ERISA Compliance...................................................121
5.13 Subsidiaries; Equity Interests; Loan Parties.......................122
5.14 Margin Regulations; Investment Company Act; Public Utility
Holding Company Act................................................122
5.15 Disclosure.........................................................123
5.16 Intellectual Property; Licenses, Etc...............................123
5.17 Solvency...........................................................123
ARTICLE VI
AFFIRMATIVE COVENANTS
6.01 Financial Statements...............................................124
6.02 Certificates; Other Information....................................125
6.03 Notices............................................................126
6.04 Payment of Obligations.............................................127
6.05 Preservation of Existence, Etc.....................................127
6.06 Maintenance of Properties..........................................127
6.07 Maintenance of Insurance...........................................127
6.08 Compliance with Laws...............................................128
6.09 Books and Records..................................................128
6.10 Inspection Rights..................................................128
6.11 Use of Proceeds....................................................128
6.12 Covenant to Guarantee Obligations and Give Security................128
6.13 Compliance with Environmental Laws.................................132
6.14 Further Assurances.................................................132
6.15 Interest Rate Hedging..............................................132
6.16 Cash Collateral Accounts...........................................132
6.17 Euro Borrower Financial Condition..................................133
ii
6.18 Real Estate Post-Closing Obligations...............................133
6.19 Foreign Collateral Post-Closing Obligations........................135
ARTICLE VII
NEGATIVE COVENANTS
7.01 Liens..............................................................136
7.02 Indebtedness.......................................................139
7.03 Investments........................................................142
7.04 Fundamental Changes................................................145
7.05 Dispositions.......................................................146
7.06 Restricted Payments................................................147
7.07 Change in Nature of Business.......................................149
7.08 Transactions with Affiliates.......................................149
7.09 Burdensome Agreements..............................................149
7.10 Use of Proceeds....................................................149
7.11 Financial Covenants................................................149
7.12 Capital Expenditures...............................................150
7.13 Amendments of Organization Documents...............................150
7.14 Accounting Changes.................................................150
7.15 Prepayments, Etc. of Indebtedness..................................151
7.16 Amendment, Etc. of Related Documents and Indebtedness..............151
7.17 Speculative Transactions...........................................151
7.18 Limitations on Finance Companies and Certain German Entities.......151
7.19 Designation of Senior Debt.........................................151
7.20 Limitations of Undertakings........................................151
Article VIII
EVENTS OF DEFAULT AND REMEDIES
8.01 Events of Default..................................................152
8.02 Remedies Upon Event of Default.....................................155
8.03 Application of Funds...............................................156
ARTICLE IX
ADMINISTRATIVE AGENT
9.01 Appointment and Authority..........................................157
9.02 Power of Attorney for German Collateral Agreements to the
Administrative Agent in its capacity as "collateral agent".........157
9.03 Rights as a Lender.................................................158
9.04 Exculpatory Provisions.............................................158
9.05 Reliance by Administrative Agent...................................159
9.06 Delegation of Duties...............................................159
9.07 Resignation of Administrative Agent................................160
9.08 Non-Reliance on Administrative Agent and Other Lenders.............160
9.09 No Other Duties, Etc...............................................161
iii
9.10 Administrative Agent May File Proofs of Claim......................161
9.11 Collateral and Guaranty Matters....................................162
9.12 Appointment of Supplemental Collateral Agents......................162
9.13 Abstract Acknowledgement of Indebtedness/Joint Creditorship........163
ARTICLE X
MISCELLANEOUS
10.01 Amendments, Etc....................................................165
10.02 Notices and Other Communications; Facsimile Copies.................167
10.03 No Waiver; Cumulative Remedies.....................................169
10.04 Expenses; Indemnity; Damage Waiver.................................169
10.05 Payments Set Aside.................................................171
10.06 Successors and Assigns.............................................172
10.07 Treatment of Certain Information; Confidentiality..................176
10.08 Right of Setoff....................................................177
10.09 Non-U.S. Subsidiaries..............................................177
10.10 Interest Rate Limitation...........................................178
10.11 Counterparts; Effectiveness........................................178
10.12 Survival of Representations and Warranties.........................178
10.13 Severability.......................................................178
10.14 Replacement of Lenders.............................................178
10.15 Judgment...........................................................179
10.16 Governing Law; Jurisdiction; Etc...................................180
10.17 Waiver of Jury Trial...............................................181
10.18 USA PATRIOT Act Notice.............................................181
10.19 "Know your customer" checks........................................181
SIGNATURES..................................................................183
iv
SCHEDULES
I KGaA Guarantors
II ROV Guarantors
III UK Guarantors
IV Consolidated EBITDA
V Existing Letters of Credit
2.01 Commitments and Applicable Percentages
5.05 Supplement to Interim Financial Statements
5.06 Litigation
5.08(b) Owned Real Property
5.08(c) Leased Real Property
5.09 Environmental Matters
5.13 Subsidiaries and Other Equity Investments;
Loan Parties
5.16 Intellectual Property Claims
6.18 Real Property to be Mortgaged
7.01(b) Existing Permitted Liens
7.02 Indebtedness
7.03(f) Existing Permitted Investments
7.05(m) Certain Dispositions
7.08 Certain Transactions with Affiliates
10.02 Administrative Agent's Office, Certain Addresses
for Notices
10.06 Processing and Recordation Fees
EXHIBITS
Form of
A Committed Loan Notice
B Swing Line Loan Notice
C-1 Term Note
C-2 U.S. Revolving Credit Note
C-3 Euro Revolving Term Note
C-4 UK Revolving Credit Note
D Compliance Certificate
E Assignment and Assumption
F-1 ROV Guaranty
F-2 KGaA Guaranty
F-3 UK Guaranty
G Security Agreement
H-1 Mortgage
H-2 Third Amendment to Mortgage
I-1 Opinion Matters - Counsel to Loan Parties
I-2 Opinion Matters - Local Counsel to Loan Parties
I-3 Opinion Matters - Real Estate Counsel to Loan Parties
v
CREDIT AGREEMENT
This FOURTH AMENDED AND RESTATED CREDIT AGREEMENT ("Agreement") is
entered into as of February 7, 2005, among Rayovac Corporation, a Wisconsin
corporation (the "U.S. Borrower"), Varta Consumer Batteries GmbH & Co. KGaA, a
German partnership limited by shares (the "Euro Borrower"), Rayovac Europe
Limited, a limited liability company (the "UK Borrower and, with the Euro
Borrower, each a "Subsidiary Borrower" and collectively, the "Subsidiary
Borrowers" and the Subsidiary Borrowers, with the U.S. Borrower, each a
"Borrower" and collectively, the "Borrowers"), each lender from time to time
party hereto (collectively, the "Lenders" and individually, a "Lender"),
Citicorp North America, Inc., as Syndication Agent, Merrill Lynch Capital
Corporation, as Documentation Agent and Managing Agent, and Bank of America,
N.A., as Administrative Agent (as hereinafter defined), Swing Line Lender (as
hereinafter defined) and L/C Issuer (as hereinafter defined).
The U.S. Borrower and the Euro Borrower have entered into that certain
Third Amended and Restated Credit Agreement dated as of October 1, 2002 with
Bank of America, N.A. as administrative agent, and the lenders party thereto
(as amended, supplemented or otherwise modified from time to time in accordance
with the terms thereof, the "Existing Rayovac Credit Agreement").
Pursuant to the Agreement and Plan of Merger dated January 3, 2005 (as
amended, supplemented or otherwise modified in accordance with its terms, to
the extent permitted in accordance with the Loan Documents (as hereinafter
defined), the "Merger Agreement") between the U.S. Borrower, United Industries
Corporation ("UIC") and Lindberg Corporation ("Newco"), the U.S. Borrower has
agreed to acquire all of the stock of UIC through a merger (the "Merger") of
Newco with and into UIC.
The Borrowers have requested that the Lenders amend and restate the
Existing Rayovac Credit Agreement to lend to the Borrowers up to U.S.$1.03
billion in order to (a) pay to the existing holders of the Equity Interests of
UIC the cash consideration for their shares in the Merger, (b) refinance (i)
the existing senior credit facilities of UIC and its Subsidiaries (as
hereinafter defined) and (ii) the existing senior subordinated notes of UIC
(collectively, the "Refinancing"), (c) pay transaction fees and expenses
incurred in connection with the Merger and the Refinancing and (d) provide
ongoing working capital and for other general corporate purposes of the
Borrowers and their Subsidiaries.
The Lenders have indicated their willingness to amend and restate the
Existing Rayovac Credit Agreement in its entirety to read as set forth herein,
on the terms and subject to the conditions set forth herein and it has been
agreed
In consideration of the mutual covenants and agreements herein
contained, the parties hereto covenant and agree as follows:
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
1.01 Defined Terms. As used in this Agreement, the following terms
shall have the meanings set forth below:
1
"2013 Notes" means the 8.5% unsecured subordinated notes of the U.S.
Borrower due 2013 in an aggregate principal amount of U.S.$350 million issued
and sold on September 30, 2003 pursuant to the 2013 Notes Indenture.
"2013 Notes Indenture" means the Indenture, dated as of September 30,
2003, among the U.S. Borrower, the guarantors named therein and U.S. Bank
National Association, as trustee.
"2015 Notes" means the 7.375% subordinated notes of the U.S. Borrower
due 2015 in an aggregate principal amount of U.S.$700 million issued and sold
on the Closing Date pursuant to the 2015 Notes Indenture.
"2015 Notes Indenture" means the Indenture to be dated as of the
Closing Date, among the U.S. Borrower, the guarantors named therein and U.S.
Bank National Association, as trustee.
"80% Subsidiary" means any Subsidiary in which (other than director's
qualifying shares or similar shares owned by other Persons due to native
ownership requirements) at least 80% of the capital stock or other equity
interests of each class is owned beneficially and of record by the U.S.
Borrower or by one or more Wholly-Owned Subsidiaries.
"Acceptable Bank" has the meaning specified in the definition of "Cash
Equivalents".
"Acknowledgment I" has the meaning specified in Section 9.13(a).
"Acknowledgment II" has the meaning specified in Section 9.13(b).
"Acknowledgment III" has the meaning specified in Section 9.13(c).
"Acquisition" means any transaction or series of related transactions
for the purpose of, or resulting directly or indirectly in, (a) the acquisition
of all or substantially all of the assets of a Person, or of any business or
division of a Person, (b) the acquisition of in excess of 50% of the capital
stock, partnership interests, membership interests or equity of any Person, or
otherwise causing any Person to become a Subsidiary or (c) a merger or
consolidation or any other combination with another Person (other than a Person
that is a Subsidiary), provided that the U.S. Borrower or a Subsidiary is the
surviving entity.
"Additional Foreign Currency Facility" means a revolving credit
facility made available by certain Lenders hereunder to a Subsidiary of the
U.S. Borrower in a currency other than Dollars.
"Administrative Agent" means Bank of America in its capacity as
administrative agent under any of the Loan Documents, or any successor
administrative agent.
"Administrative Agent's Office" means the Administrative Agent's
address and, as appropriate, account as set forth on Schedule 10.02, or such
other address or account as the Administrative Agent may from time to time
notify to the Borrowers and the Lenders.
2
"Administrative Questionnaire" means an Administrative Questionnaire
in a form supplied by the Administrative Agent.
"Affiliate" means, with respect to any Person, another Person that
directly, or indirectly through one or more intermediaries, Controls or is
Controlled by or is under common Control with the Person specified.
"Aggregate Commitments" means the Commitments of all the Lenders.
"Agreement" means this Credit Agreement.
"Applicable Euro Revolving Credit Percentage" means with respect to
any Euro Revolving Credit Lender at any time, such Euro Revolving Credit
Lender's Applicable Percentage in respect of the Euro Revolving Credit Facility
at such time.
"Applicable Percentage" means (a) in respect of the Canadian Term
Facility, with respect to any Canadian Term Lender at any time, the percentage
(carried out to the ninth decimal place) of the Canadian Term Facility
represented by (i) on or prior to the Closing Date, such Canadian Term Lender's
Canadian Term Commitment at such time and (ii) thereafter, the principal amount
of such Canadian Term Lender's Canadian Term Loans at such time, (b) in respect
of the Dollar Term Facility, with respect to any Dollar Term Lender at any
time, the percentage (carried out to the ninth decimal place) of the Dollar
Term Facility represented by (i) on or prior to the Closing Date, such Dollar
Term Lender's Dollar Term Commitment at such time and (ii) thereafter, the
principal amount of such Dollar Term Lender's Dollar Term Loans at such time,
(c) in respect of the Euro Term Facility, with respect to any Euro Term Lender
at any time, the percentage (carried out to the ninth decimal place) of the
Euro Term Facility represented by (i) on or prior to the Closing Date, such
Euro Term Lender's Euro Term Commitment at such time and (ii) thereafter, the
principal amount of such Euro Term Lender's Euro Term Loans at such time, (d)
in respect of the Euro Revolving Credit Facility, with respect to any Euro
Revolving Credit Lender at any time, the percentage (carried out to the ninth
decimal place) of the Euro Revolving Credit Facility represented by such Euro
Revolving Credit Lender's Euro Revolving Credit Commitment at such time and (e)
in respect of the UK Revolving Credit Facility, with respect to any UK
Revolving Credit lender at any time, the percentage (carried out to the ninth
decimal place) of the UK Revolving Credit Facility represented by such UK
Revolving Credit lender's UK Revolving Credit Commitment at such time and (f)
in respect of the U.S. Revolving Credit Facility, with respect to any U.S.
Revolving Credit Lender at any time, the percentage (carried out to the ninth
decimal place) of the U.S. Revolving Credit Facility represented by such U.S.
Revolving Credit Lender's Revolving Credit Commitment at such time. If the Euro
Revolving Credit Commitment of each Euro Revolving Credit Lender to make Euro
Revolving Credit Loans have been terminated pursuant to Section 8.02, or if the
Euro Revolving Credit Commitments have expired, then the Applicable Percentage
of each Euro Revolving Credit Lender in respect of the Euro Revolving Credit
Facility shall be determined based on the Applicable Percentage of such Euro
Revolving Credit Lender in respect of the Euro Revolving Credit Facility most
recently in effect, giving effect to any subsequent assignments. If the UK
Revolving Credit Commitment of each UK Revolving Credit Lender to make UK
Revolving Credit Loans have been terminated pursuant to Section 8.02, or if the
UK Revolving Credit Commitments have expired, then the Applicable Percentage of
each UK Revolving Credit Lender in respect of the UK Revolving Credit Facility
shall be determined based on the Applicable Percentage of such UK Revolving
Credit Lender in respect of the UK Revolving Credit Facility most recently in
effect, giving effect to any subsequent assignments. If the U.S. Revolving
Credit Commitment of each U.S. Revolving Credit Lender to make U.S. Revolving
Credit Loans and the obligation of the L/C Issuer to make L/C Credit Extensions
have been terminated pursuant to Section 8.02, or if the U.S. Revolving Credit
Commitments have expired, then the Applicable Percentage
3
of each U.S. Revolving Credit Lender in respect of the U.S. Revolving Credit
Facility shall be determined based on the Applicable Percentage of such U.S.
Revolving Credit Lender in respect of the U.S. Revolving Credit Facility most
recently in effect, giving effect to any subsequent assignments. The initial
Applicable Percentage of each Lender in respect of each Facility is set forth
opposite the name of such Lender on Schedule 2.01 or in the Assignment and
Assumption pursuant to which such Lender becomes a party hereto, as applicable.
"Applicable Rate" means (a) in respect of the Revolving Credit
Facilities, (i) for the first six months following the Closing Date, 1.25% per
annum for Base Rate Loans and 2.25% per annum for Eurocurrency Rate Loans and
(ii) thereafter, a percentage per annum as set forth in the table below
determined by reference to the Consolidated Leverage Ratio as set forth in the
most recent Compliance Certificate received by the Administrative Agent
pursuant to Section 6.02(a):
- ----------------------------------------------------------------------------------------------------------------------
Eurocurrency Rate
Revolving Credit Base Rate
Loans and Letters of Revolving
Pricing Level Consolidated Leverage Ratio Commitment Fee Credit Credit Loans
- ----------------------------------------------------------------------------------------------------------------------
1 <3.50:1 0.50 1.75 0.75
- ----------------------------------------------------------------------------------------------------------------------
2 >3.50:1 but <4.00:1 0.50 2.00 1.00
- ----------------------------------------------------------------------------------------------------------------------
3 >4.00:1 0.50 2.25 1.25
- ----------------------------------------------------------------------------------------------------------------------
Any increase or decrease in the Applicable Rate resulting from a
change in the Consolidated Leverage Ratio shall become effective as of the
first Business Day immediately following the date a Compliance Certificate is
delivered pursuant to Section 6.02(a); provided, however, that if a Compliance
Certificate is not delivered when due in accordance with such Section, then
Pricing Level 3 shall apply from and as of the first Business Day after the
date on which such Compliance Certificate was required to have been delivered
until the date such Compliance Certificate is delivered,
(b) in respect of the Canadian Term Loans and the Dollar Term Loans
(i) for the first six months following the Closing Date, 2.00% per annum
for Canadian Term Loans and for Dollar Term Loans that are Eurocurrency
Rate Loans and 1.00% per annum for Dollar Term Loans that are Base Rate
Loans and (ii) thereafter, a percentage to be determined by reference to
the Debt Rating certified by the U.S. Borrower as described below:
4
- ----------------------------------------------------------------------------------------
Eurocurrency Base Rate
Pricing Debt Ratings Canadian Term Rate Dollar Term Dollar Term
Level S&P/Moody's Loans Loans Loans
- ----------------------------------------------------------------------------------------
1 BB-/Ba3 or better 1.75 1.75 0.75
- ----------------------------------------------------------------------------------------
2 B+/B1 or worse 2.00 2.00 1.00
- ----------------------------------------------------------------------------------------
Initially, the Applicable Rate shall be determined based upon the Debt
Rating specified in a certificate delivered by the U.S. Borrower as to its
existing Debt Rating on such date. Thereafter, each change in the Applicable
Rate resulting from a publicly announced change in the Debt Rating shall be
effective, in the case of an upgrade, during the period commencing on the date
of the public announcement thereof (such announcement to be notified to the
Administrative Agent by the U.S. Borrower) and ending on the date immediately
preceding the effective date of the next such change and, in the case of a
downgrade, during the period commencing on the date of the public announcement
thereof and ending on the date immediately preceding the effective date of the
next such change, and
(c) in respect of the Euro Term Loans, 2.50% per annum.
"Applicable UK Revolving Credit Percentage" means with respect to any
UK Revolving Credit Lender at any time, such UK Revolving Credit Lender's
Applicable Percentage in respect of the UK Revolving Credit Facility at such
time.
"Applicable U.S. Revolving Credit Percentage" means with respect to
any U.S. Revolving Credit Lender at any time, such U.S. Revolving Credit
Lender's Applicable Percentage in respect of the U.S. Revolving Credit Facility
at such time.
"Appropriate Lender" means, at any time, (a) with respect to any of
the Canadian Term Facility, the Dollar Term Facility, the Euro Term Facility,
the U.S. Revolving Credit Facility, the Euro Revolving Credit Facility or the
UK Revolving Credit Facility, a Lender that has a Commitment with respect to
such Facility at such time, (b) with respect to the Dollar Letter of Credit
Sublimit, (i) the L/C Issuer and (ii) if any Letters of Credit have been issued
pursuant to Section 2.03(a), the U.S. Revolving Credit Lenders, (c) with
respect to the Euro Letter of Credit Sublimit, (i) the L/C Issuer and (ii) if
any Letters of Credit have been issued pursuant to Section 2.04(a), the Euro
Revolving Credit Lenders, (d) with respect to the UK Letter of Credit Sublimit,
(i) the L/C Issuer and (ii) if any Letters of Credit have been issued pursuant
to Section 2.05(a), the UK Revolving Credit Lenders and (e) with respect to
either the Dollar Swing Line, the Euro Swing Line or the UK Swing Line, (i) the
Swing Line Lender, (ii) if any Dollar Swing Line Loans are outstanding pursuant
to Section 2.06(a), the U.S. Revolving Credit Lenders, (iii) if any Euro Swing
Line Loans are outstanding pursuant to Section 2.06(b), the Euro Revolving
Credit Lenders and (iv) if any UK Swing Line Loans are outstanding pursuant to
Section 2.06(c), the UK Revolving Credit Lenders.
"Approved Fund" means any Fund that is administered or managed by (a)
a Lender, (b) an Affiliate of a Lender or (c) an entity (including an
investment advisor) or an Affiliate of an entity that administers or manages a
Lender.
5
"Arrangers" means BAS and CGMI, in their capacities as joint lead
arrangers.
"Assignee Group" means two or more Eligible Assignees that are
Affiliates of one another or two or more Approved Funds managed by the same
investment advisor.
"Assignment and Assumption" means an assignment and assumption entered
into by a Lender and an Eligible Assignee (with the consent of any party whose
consent is required by Section 10.06(b), and accepted by the Administrative
Agent, in substantially the form of Exhibit E or any other form approved by the
Administrative Agent.
"Assuming Lender" has the meaning specified in Section 2.16(d).
"Assumption Agreement" has the meaning specified in Section 2.16(d).
"Attributable Indebtedness" means, on any date, (a) in respect of any
Capitalized Lease of any Person, the capitalized amount of the remaining lease
thereof that would appear on a balance sheet of such Person prepared as of such
date in accordance with GAAP, (b) in respect of any Synthetic Lease Obligation,
the capitalized amount of the remaining lease or similar payments under the
relevant lease or other applicable agreement or instrument that would appear on
a balance sheet of such Person prepared as of such date in accordance with GAAP
if such lease or other agreement or instrument were accounted for as a
Capitalized Lease and (c) all Synthetic Debt of such Person.
"Audited Financial Statements" means the audited consolidated balance
sheets of (i) the U.S. Borrower and its Subsidiaries for the fiscal year ended
September 30, 2004 and (ii) UIC and its Subsidiaries for the fiscal year ended
December 31, 2003 and, in each case, the related consolidated statements of
income or operations, shareholders' equity and cash flows for such fiscal year
of the U.S. Borrower and its Subsidiaries and UIC and its Subsidiaries,
respectively, including the notes thereto.
"Auto-Extension Dollar Letter of Credit" has the meaning specified in
Section 2.03(b)(iii).
"Auto-Extension Euro Letter of Credit" has the meaning specified in
Section 2.04(b)(iii).
"Auto-Extension UK Letter of Credit" has the meaning specified in
Section 2.05(b)(iii).
"Availability Period" means the period from and including the Closing
Date to (a) in respect of the U.S. Revolving Credit Facility, the earliest of
(i) the Maturity Date for the U.S. Revolving Credit Facility, (ii) the date of
termination of the U.S. Revolving Credit Commitments pursuant to Section 2.08,
and (iii) the date of termination of the commitment of each U.S. Revolving
Credit Lender to make U.S. Revolving Credit Loans and of the obligation of the
L/C Issuer to make Dollar L/C Credit Extensions pursuant to Section 8.02, (b)
in respect of the Euro Revolving Credit Facility, the earliest of (i) the
Maturity Date for the Euro Revolving Credit Facility, (ii) the date of
termination of the Euro Revolving Credit Commitments pursuant to Section 2.08,
and (iii) the date of termination of the commitment of each Euro Revolving
Credit
6
Lender to make Euro Revolving Credit Loans and of the obligation of the L/C
Issuer to make Euro L/C Credit Extensions pursuant to Section 8.02 and (c) in
respect of the UK Revolving Credit Facility, the earliest of (i) the Maturity
Date for the UK Revolving Credit Facility, (ii) the date of termination of the
UK Revolving Credit Commitments pursuant to Section 2.08, and (iii) the date of
termination of the commitment of each UK Revolving Credit Lender to make UK
Revolving Credit Loans and of the obligation of the L/C Issuer to make UK L/C
Credit Extensions pursuant to Section 8.02.
"Average Dollar Equivalent" means, on any date, in relation to any
Indebtedness outstanding on such date denominated in a Foreign Currency, the
amount of Dollars that could be purchased with the amount of such Indebtedness
at the average of the foreign exchange spot rates of the Administrative Agent
on the last day of each of the twelve calendar months preceding such date.
"Backstop L/C" has the meaning specified in Section 2.03(g).
"Bank of America" means Bank of America, N.A. and its successors.
"BAS" means Banc of America Securities LLC and its successors.
"Base Rate" means for any day a fluctuating rate per annum equal to
the higher of (a) the Federal Funds Rate plus 1/2 of 1% and (b) the rate of
interest in effect for such day as publicly announced from time to time by Bank
of America as its "prime rate." The "prime rate" is a rate set by Bank of
America based upon various factors including Bank of America's costs and
desired return, general economic conditions and other factors, and is used as a
reference point for pricing some loans, which may be priced at, above, or below
such announced rate. Any change in such rate announced by Bank of America shall
take effect at the opening of business on the day specified in the public
announcement of such change.
"Base Rate Loan" means a Loan that bears interest based on the Base
Rate.
"Book Managers" means BAS, CGMI and MLPF&S in their capacities as
joint book managers.
"Borrower" has the meaning specified in the introductory paragraph
hereto.
"Borrower Materials" has the meaning specified in Section 6.02.
"Borrowing" means a U.S. Revolving Credit Borrowing, a Euro Revolving
Credit Borrowing, a UK Revolving Credit Borrowing, a Dollar Swing Line
Borrowing, a Euro Swing Line Borrowing, a UK Swing Line Borrowing, a Canadian
Term Borrowing, a Dollar Term Borrowing or a Euro Term Borrowing, as the
context may require.
"Business Day" means any day other than (a) a Saturday, Sunday or
other day on which commercial banks in New York, Chicago or Charlotte are
authorized to close under the Laws of New York, Illinois or North Carolina, or
are in fact closed in, the state where the Administrative Agent's Office is
located, (b) if such day relates to any Eurocurrency Rate Loan, a day on which
banks are not open for general business in London and (c) if such day relates
to
7
any Eurocurrency Rate Loan denominated in a Foreign Currency other than Euro, a
day on which banks are not open for general business in the principal financial
center of the country of that currency or, if such day relates to a Loan in
Euros, any day that is not a TARGET Day.
"Canadian Dollar" and "CAD" mean lawful money of Canada.
"Canadian Share Pledge" means the Share Pledge Agreement dated as of
October 1, 2002 (as reaffirmed by the Confirmation of Security dated as of the
Closing Date) made by ROV Holding in favor of the Administrative Agent, for the
benefit of the Lenders, in respect of the Equity Interests in Rayovac Canada
Inc.
"Canadian Term Borrowing" means a borrowing consisting of simultaneous
Canadian Term Loans having the same Interest Period made by each of the
Canadian Term Lenders pursuant to Section 2.01(a).
"Canadian Term Commitment" means, as to each Canadian Term Lender, its
obligation to make Canadian Term Loans to the U.S. Borrower pursuant to Section
2.01(a) in an aggregate principal amount at any one time outstanding not to
exceed the amount set forth opposite such Lender's name on Schedule 2.01 under
the caption "Canadian Term Commitment" or opposite such caption in the
Assignment and Assumption pursuant to which such Lender becomes a party hereto,
as applicable, as such amount may be adjusted from time to time in accordance
with this Agreement.
"Canadian Term Facility" means, at any time, (a) on or prior to the
Closing Date, the aggregate amount of the Canadian Term Commitments at such
time and (b) thereafter, the aggregate principal amount of the Canadian Term
Loans of all Canadian Term Lenders outstanding at such time.
"Canadian Term Lender" means (a) at any time on or prior to the
Closing Date, any Lender that has a Canadian Term Commitment at such time and
(b) at any time after the Closing Date, any Lender that holds Canadian Term
Loans, at such time.
"Canadian Term Loan" means an advance made by any Canadian Term Lender
under the Canadian Term Facility.
"Canadian Term Note" means a promissory note made by the U.S. Borrower
in favor of a Canadian Term Lender evidencing Canadian Term Loans made by such
Canadian Term Lender, in substantially the form of Exhibit C-1.
"Capital Expenditure Carryover Amount" has the meaning specified in
Section 7.12.
"Capital Expenditures" means, with respect to any Person for any
period, all expenditures that, in accordance with GAAP, would be required to be
capitalized and shown on the consolidated balance sheet of the U.S. Borrower,
but excluding expenditures made in connection with the replacement,
substitution, restoration or trade-in of assets to the extent financed (a) from
insurance proceeds (or other similar recoveries) paid on account of the loss of
or damage to the assets being replaced or restored, (b) with awards of
compensation arising from
8
the taking by eminent domain or condemnation of the assets being replaced, (c)
proceeds received from assets Disposed of contemporaneously with such
expenditure or (d) with a credit by the seller of such assets for the assets
being simultaneously traded in.
"Capitalized Leases" means all leases that have been or should be, in
accordance with GAAP, recorded as capitalized leases.
"Cash Collateral" has the meaning specified in Section 2.03(g).
"Cash Collateral Account" means a blocked, non-interest bearing
deposit account of one or more of the Loan Parties at Bank of America or, in
respect of non-U.S. Cash Collateral Accounts, at Bank of America or another
commercial bank to the extent the Collateral Agent has a perfected security in
such account, in each case, in the name of the Collateral Agent and under the
sole dominion and control of the Collateral Agent, and otherwise established in
a manner reasonably satisfactory to the Administrative Agent.
"Cash Collateralize" has the meaning specified in Section 2.03(g).
"Cash Equivalents" means any of the following types of Investments, to
the extent owned by the U.S. Borrower or any of its Subsidiaries free and clear
of all Liens (other than Liens permitted in the manner specified hereunder):
(a) readily marketable obligations issued or directly and fully
guaranteed or insured by the United States of America, an OECD Member, any
member of the European Economic Union or any agency or instrumentality
thereof having maturities of not more than 365 days from the date of
acquisition thereof; provided that the full faith and credit of the United
States of America, member of the European Economic Union or such OECD
Member is pledged in support thereof;
(b) time deposits with, or insured certificates of deposit or bankers'
acceptances of, any commercial bank that (each such bank an "Acceptable
Bank") (i) (A) is a Lender, (B) is organized under the laws of the United
States of America, any state thereof or the District of Columbia or is the
principal banking subsidiary of a bank holding company organized under the
laws of the United States of America, any state thereof or the District of
Columbia, and is a member of the Federal Reserve System or (C) is a member
of the applicable central bank of any OECD Member or any member of the
European Economic Union, (ii) issues (or the parent of which issues)
commercial paper rated as described in clause (c) of this definition and
(iii) has combined capital and surplus of at least U.S. $250,000,000 (or
the equivalent in the applicable currency), in each case with maturities
of not more than 365 days from the date of acquisition thereof;
(c) commercial paper issued by any Person organized under the laws of
any state of the United States of America, any member state of the
European Economic Union or any OECD Member or any Acceptable Bank and
rated at least "Prime-1" (or the then equivalent grade) by Moody's or
Fitch or at least "A-1" (or the then equivalent grade) by S&P, or
guaranteed by any industrial company with long-term unsecured debt rating
(at the time of investment) of at least AA by S&P or at least Aa by
Moody's or
9
Fitch in each case with maturities of not more than 365 days from the date
of acquisition thereof;
(d) investments, classified in accordance with GAAP as current assets
of the U.S. Borrower or any of its Subsidiaries, in money market
investment programs, which are administered by financial institutions that
have the highest rating obtainable from either Moody's or S&P, and the
portfolios of which are limited solely to Investments of the character,
quality and maturity described in clauses (a), (b) and (c) of this
definition;
(e) repurchase agreements with any Lender or any primary dealer
maturing within 365 days from the date of investment that are fully
collateralized by investment instruments that would otherwise be Cash
Equivalents; provided that the terms of such repurchase agreements comply
with the guidelines set forth in the Federal Financial Institutions
Examination Council Supervisory Policy -- Repurchase Agreements of
Depository Institutions With Securities Dealers and Others, as adopted by
the Comptroller of the Currency on October 31, 1985;
(f) sterling bills of exchange eligible for rediscount at the Bank of
England and accepted by an Acceptable Bank (or their dematerialized
equivalents);
(g) any other debt security approved by the Required Lenders; and
(h) any investment made by a Foreign Subsidiary in its jurisdiction of
organization that is of similar credit quality and similar maturity
(including character, quality and maturities) as one of the investments
described in clause (a) - (f) above.
"Cayman Finance Co." means ROV International Finance Company, a Cayman
Islands exempted company and a Subsidiary.
"Caymans Share Charges" means, collectively, (a) the Share Charge in
respect of shares of Rayovac Overseas Corp. to be entered into by ROV Holding,
(b) the Share Charge in respect of shares of ROV International Finance Company
to be entered into by ROV Holding, and (c) the Share Charge in respect of
shares of Rayovac PRC to be entered into by ROV Holding, in each case in form
and substance satisfactory to the Administrative Agent.
"CERCLA" means the Comprehensive Environmental Response, Compensation
and Liability Act of 1980.
"CERCLIS" means the Comprehensive Environmental Response, Compensation
and Liability Information System maintained by the U.S. Environmental
Protection Agency.
"CGMI" means Citigroup Global Markets Inc. and its successors.
"Change in Law" means the occurrence, after the date of this
Agreement, of any of the following: (a) the adoption or taking effect of any
law, rule, regulation or treaty, (b) any change in any law, rule, regulation or
treaty or in the administration, interpretation or application thereof by any
Governmental Authority or (c) the making or issuance of any request, guideline
or directive (whether or not having the force of law) by any Governmental
Authority.
10
"Change of Control" means, an event or series of events by which:
(a) any "person" or "group" (as such terms are used in Sections 13(d)
and 14(d) of the Securities Exchange Act of 1934, but excluding any
employee benefit plan of such person or its subsidiaries, and any person
or entity acting in its capacity as trustee, agent or other fiduciary or
administrator of any such plan) other than THLee or any group of which
THLee is a member becomes the "beneficial owner" (as defined in Rules
13d-3 and 13d-5 under the Securities Exchange Act of 1934, except that a
person or group shall be deemed to have "beneficial ownership" of all
securities that such person or group has the right to acquire (such right,
an "option right"), whether such right is exercisable immediately or only
after the passage of time), directly or indirectly, of 40% or more of the
equity securities of the U.S. Borrower entitled to vote for members of the
board of directors or equivalent governing body of the U.S. Borrower on a
fully-diluted basis; or
(b) during any period of 12 consecutive months, a majority of the
members of the board of directors or other equivalent governing body of
the U.S. Borrower cease to be composed of individuals (i) who were members
of that board or equivalent governing body on the first day of such
period, (ii) whose election or nomination to that board or equivalent
governing body was approved by individuals referred to in clause (i) above
constituting at the time of such election or nomination at least a
majority of that board or equivalent governing body or (iii) whose
election or nomination to that board or other equivalent governing body
was approved by individuals referred to in clauses (i) and (ii) above
constituting at the time of such election or nomination at least a
majority of that board or equivalent governing body (excluding, in the
case of both clause (ii) and clause (iii), any individual whose initial
nomination for, or assumption of office as, a member of that board or
equivalent governing body occurs as a result of an actual or threatened
solicitation of proxies or consents for the election or removal of one or
more directors by any person or group other than a solicitation for the
election of one or more directors by or on behalf of the board of
directors), or
(c) any Person or two or more Persons (other than THLEE or any group
of which THLEE is a member) acting in concert shall have acquired by
contract or otherwise, or shall have entered into a contract or
arrangement that, upon consummation thereof, will result in its or their
acquisition of the power to exercise, directly or indirectly, a
controlling influence over the management or policies of the U.S.
Borrower, or control over the equity securities of the U.S. Borrower
entitled to vote for members of the board of directors or equivalent
governing body the U.S. Borrower on a fully-diluted basis (and taking into
account all such securities that such "person" or "group" has the right to
acquire pursuant to any option right) representing 40% or more of the
combined voting power of such securities, or
(d) the giving of notice to the holders of either the 2013 Notes or
the 2015 Notes that a "Change of Control" or any comparable term under,
and as defined in, the 2013 Notes Indenture, or the 2015 Notes Indenture,
respectively, shall have occurred.
"Chinese Facility" means a facility in an amount not to exceed the
Equivalent in Yuan of U.S. $35,000,000 that is made available to a Subsidiary
of the U.S. Borrower organized
11
under the laws of China pursuant to (i) a bilateral facility with a third party
lender that is guaranteed by the U.S. Borrower, (ii) a bilateral facility with
a third party lender and in connection therewith a Letter of Credit is issued
to such third party lender under the U.S. Revolving Credit Facility or (iii) a
revolving credit facility made available by certain Lenders hereunder.
"Closing Date" means the first date all the conditions precedent in
Section 4.01 are satisfied or waived in accordance with Section 10.01.
"Closing Date Dormant Subsidiaries" means Minera Vidaluz, S.A. de
C.V., a corporation organized under the laws of Mexico, Zoe-Phos International
N.V., a corporation organized under the laws of Netherlands Antilles, Rayovac
Far East Limited, a company organized under the laws of Hong Kong, Rayovac
Latin America, Ltd., a company organized under the laws of the Cayman Islands,
Rayovac Foreign Sales Corporation, a corporation organized under the laws of
Barbados, Remington Licensing Corporation, a corporation organized under the
laws of the state of Delaware, Rayovac (UK) Ltd., a limited liability company
organized under the laws of the United Kingdom, Varta Ltd., a limited liability
company organized under the laws of the United Kingdom, Remington Consumer
Products Ltd., a limited liability company organized under the laws of the
United Kingdom, Rayovac Europe B.V., a limited liability company organized
under the laws of the Netherlands, Brisco Electronics B.V., a limited liability
company organized under the laws of the Netherlands, Rayovac Brasil
Participacoes Ltda., a company organized under the laws of Brazil, Rayovac
Battery Participacoes Ltda., a company organized under the laws of Brazil,
Rayovac Honduras S.A., a company organized under the laws of Honduras, and
Remington Products GmbH, a limited liability companyorganized under the laws of
Germany.
"CNAI" means Citicorp North America, Inc.
"Code" means the Internal Revenue Code of 1986, as amended from time
to time.
"Collateral" means all of the "Collateral", "Mortgaged Property" and
"Pledged Shares" (or other similar terms) referred to in the Collateral
Documents and intended under the terms of the Collateral Documents to be
subject to Liens in favor of the Administrative Agent for the benefit of the
Secured Parties.
"Collateral Documents" means, collectively, the Security Agreement,
the Intellectual Property Security Agreement, the Mortgages, each of the
Foreign Collateral Documents, the collateral assignments, Security Agreement
Supplements, IP Security Agreement Supplements, pledge agreements or other
similar agreements delivered to the Administrative Agent and the Lenders
pursuant to Section 6.12, and each of the other agreements, instruments or
documents that creates or purports to create a Lien in favor of the
Administrative Agent for the benefit of the Secured Parties.
"Commitment" means a Canadian Term Commitment, a Dollar Term
Commitment, a Euro Term Commitment or a Revolving Credit Commitment, as the
context may require.
"Commitment Date" has the meaning specified in Section 2.16(b).
12
"Committed Loan Notice" means a notice of (a) a Term Borrowing, (b) a
Revolving Credit Borrowing, (c) a conversion of Loans from one Type to the
other, or (d) a continuation of Eurocurrency Rate Loans, pursuant to Section
2.02(a), which, if in writing, shall be substantially in the form of Exhibit A.
"Compliance Certificate" means a certificate substantially in the form
of Exhibit D.
"Consolidated EBITDA" means, for any period, for the U.S. Borrower and
its Subsidiaries on a consolidated basis, an amount equal to Consolidated Net
Income for such period plus (a) the following to the extent deducted in
calculating such Consolidated Net Income: (i) Consolidated Interest Charges for
such period, (ii) the provision for Federal, state, local and foreign income
taxes payable by the U.S. Borrower and its Subsidiaries for such period (iii)
depreciation and amortization expense, (b) non-recurring losses or charges,
including Restructuring Charges, (c) estimated synergies arising out of the
Merger in an amount equal to $10 million for the fiscal quarter ended June 30,
2005, $7.5 million for the fiscal quarter ended September 30, 2005, $5 million
for the fiscal quarter ended December 31, 2005 and $2.5 million for the fiscal
quarter ended March 31, 2006 and (d) without duplication with clause (1) below,
actual and projected cost savings and synergies implemented or reasonably
expected to be implemented in the first four quarters following the
consummation of any Acquisition, on a pro forma basis, so long as such
adjustments are accompanied by a certificate of the chief financial officer of
the U.S. Borrower and minus (e) to the extent included in calculating such
Consolidated Net Income, (i) other extraordinary gains and losses for such
period and (ii) non-recurring gains; provided that (1) with respect to any
Acquisition made by the U.S. Borrower and its Subsidiaries during the period
for which Consolidated EBITDA is calculated, Consolidated EBITDA shall be
increased by the EBITDA of the Person or assets so acquired using the
historical financial statements (including audited financial statements, to the
extent applicable) for such Person and such Acquisition shall be deemed to have
occurred on the first day of the relevant period for which such Consolidated
EBITDA is calculated and (2) with respect to any Disposition of all or
substantially all of the Equity Interests or property and assets of any Person
or all or substantially all of the property and assets of a division of any
Person made by the U.S. Borrower and its Subsidiaries during the period for
which Consolidated EBITDA is calculated, Consolidated EBITDA shall be decreased
by the EBITDA of the Person or assets so Disposed of using the historical
financial statements (including audited financial statements, to the extent
applicable) for such Person and such Disposition shall be deemed to have
occurred on the first day of the relevant period for which such Consolidated
EBITDA is calculated and all such adjustments to Consolidated EBITDA as
specified in clauses (1) and (2) shall be accompanied by a certificate of the
chief financial officer of the U.S. Borrower showing such calculations in
reasonable detail; provided further that Consolidated EBITDA for each of the
two fiscal quarters ending September 30, 2004 and December 31, 2004 shall be
calculated on a pro forma basis giving effect to the Acquisition, as set forth
in reasonable detail on a certificate of the Chief Financial Officer of the
U.S. Borrower delivered to the Administrative Agent (such certificate to be
reasonably satisfactory to the Administrative Agent).
"Consolidated Funded Indebtedness" means, as of any date of
determination, for the U.S. Borrower and its Subsidiaries on a consolidated
basis, the sum of (a) the outstanding principal amount of all obligations
(including amounts drawn under both standby and
13
commercial letters of credit), whether current or long-term, for borrowed money
(including Obligations hereunder) and all obligations evidenced by bonds,
debentures, notes, loan agreements or other similar instruments, (b) all
purchase money Indebtedness, (c) all direct obligations arising under bankers'
acceptances, bank guaranties, surety bonds and similar instruments, (d) all
obligations in respect of the deferred purchase price of property or services
(other than trade accounts and accrued expenses payable in the ordinary course
of business), (e) Attributable Indebtedness (other than Synthetic Debt), (f)
without duplication, all Guarantees with respect to outstanding Indebtedness of
the types specified in clauses (a) through (e) above of Persons other than the
U.S. Borrower or any Subsidiary, (g) all Indebtedness of the types referred to
in clauses (a) through (f) above of any partnership or joint venture (other
than a joint venture that is itself a corporation or limited liability company)
in which the U.S. Borrower or a Subsidiary is a general partner or joint
venturer, unless such Indebtedness is expressly made non-recourse to the U.S.
Borrower or such Subsidiary or is owed to the U.S. Borrower or a Subsidiary and
(h) the Average Dollar Equivalent of any such Indebtedness denominated in a
Foreign Currency minus the Equivalent in Dollars of any such Indebtedness
denominated in a Foreign Currency.
"Consolidated Interest Charges" means, for any period, for the U.S.
Borrower and its Subsidiaries on a consolidated basis, the sum of (a) all
interest, premium payments, debt discount, fees, charges and related expenses
of the U.S. Borrower and its Subsidiaries in connection with borrowed money
(excluding capitalized interest, other than to the extent set forth in clause
(b) below, and any amortization of such interest, premiums and other costs) or
in connection with the deferred purchase price of assets, in each case to the
extent treated as interest in accordance with GAAP and (b) the portion of rent
expense of the U.S. Borrower and its Subsidiaries with respect to such period
under Capitalized Leases that is treated as interest in accordance with GAAP.
If the U.S. Borrower or any Subsidiary makes an Acquisition or a Disposition of
all or substantially all of the Equity Interests or property and assets of any
Person or all or substantially all of the property and assets of a division of
any Person during any period, then for purposes of determining the Consolidated
Interest Coverage Ratio and the Consolidated Leverage Ratio for such period,
Consolidated Interest Charges shall be adjusted to account for all increases or
decreases in Indebtedness directly related to such Acquisition or Disposition
based on the assumption that such increase or decrease had occurred on the
first day of such period rather than on the date of such Acquisition or
Disposition, all as reasonably determined by the U.S. Borrower and certified in
reasonable detail to the Administrative Agent and the Lenders.
"Consolidated Interest Coverage Ratio" means, as of any date of
determination, the ratio of (a) Consolidated EBITDA for the period of the four
prior fiscal quarters ending on such date to (b) Consolidated Interest Charges
for such period; provided that for purposes of calculating Consolidated
Interest Charges with respect to the fiscal quarters ending June 30, 2005,
September 30, 2005 and December 31, 2005, respectively, Consolidated Interest
Charges shall be deemed to be (i) the actual Consolidated Interest Charges for
the fiscal quarter ended June 30, 2005 multiplied by 4, (ii) the actual
Consolidated Interest Charges for the two consecutive fiscal quarters ended
September 30, 2005 multiplied by 2 and (iii) the actual Consolidated Interest
Charges for the three consecutive fiscal quarters ended December 31, 2005,
multiplied by 4/3, respectively.
14
"Consolidated Leverage Ratio" means, as of any date of determination,
the ratio of (a) Consolidated Funded Indebtedness as of such date minus the
aggregate principal amount of cash and Cash Equivalents held by the U.S.
Borrower and its Subsidiaries on such date to (b) Consolidated EBITDA for the
period of the four fiscal quarters most recently ended.
"Consolidated Net Income" means, for any period, for the U.S. Borrower
and its Subsidiaries on a consolidated basis, the net income (or loss) of the
U.S. Borrower and its Subsidiaries for that period, provided that the net
income of any Subsidiary shall be excluded from Consolidated Net Income to the
extent that the declaration or payment of dividends or similar distributions by
such Subsidiary from such income is not at the time permitted by the terms of
its charter or by-laws or any judgment, decree, order, law, statute, rule,
regulation, agreement, indenture or other instrument (other than any agreement,
indenture or other instrument the breach of which could not reasonably be
expected to result in a Material Adverse Effect) which is binding on such
Subsidiary.
"Contractual Obligation" means, as to any Person, any provision of any
security issued by such Person or of any agreement, instrument or other
undertaking to which such Person is a party or by which it or any of its
property is bound other than the Loan Documents.
"Control" means the possession, directly or indirectly, of the power
to direct or cause the direction of the management or policies of a Person,
whether through the ability to exercise voting power, by contract or otherwise.
"Controlling" and "Controlled" have meanings correlative thereto.
"Credit Extension" means each of the following: (a) a Borrowing and
(b) an L/C Credit Extension.
"Debt Rating" means, as of any date of determination, the rating as
determined by either S&P or Moody's (collectively, the "Debt Ratings") of the
U.S. Borrower's non-credit-enhanced, senior unsecured long-term debt; provided
that if (i) a Debt Rating is issued by each of the foregoing rating agencies,
then the worse of such Debt Ratings shall apply (with the Debt Rating for
Pricing Level 1 being the worst and the Debt Rating for Pricing Level 2 being
the best) and (ii) either S&P or Moody's shall change the basis on which
ratings are established by it, each reference to the Debt Rating announced by
S&P or Moody's shall refer to the then equivalent rating by S&P or Moody's, as
the case may be.
"Debtor Relief Laws" means the Bankruptcy Code of the United States,
and all other liquidation, conservatorship, bankruptcy, assignment for the
benefit of creditors, moratorium, rearrangement, receivership, insolvency,
reorganization, or similar debtor relief Laws of the United States or other
applicable jurisdictions from time to time in effect and affecting the rights
of creditors generally.
"Default" means any event or condition that constitutes an Event of
Default or that, with the giving of any notice, the passage of time, or both,
would be an Event of Default.
"Default Rate" means (a) when used with respect to Obligations other
than Letter of Credit Fees, an interest rate equal to (i) the Base Rate plus
(ii) the Applicable Rate, if any, applicable to Base Rate Loans plus (iii) 2.0%
per annum; provided, however, that with respect to
15
a Eurocurrency Rate Loan, the Default Rate shall be an interest rate equal to
the interest rate (including any Applicable Rate) otherwise applicable to such
Loan plus 2.0% per annum and (b) when used with respect to Letter of Credit
Fees, a rate equal to the Applicable Rate plus 2.0% per annum.
"Defaulting Lender" means any Lender that (a) has failed to fund any
portion of the Term Loans, Revolving Credit Loans, participations in L/C
Obligations or participations in Swing Line Loans or Foreign Currency Revolving
Credit Loans required to be funded by it hereunder within one Business Day of
the date required to be funded by it hereunder, (b) has otherwise failed to pay
over to the Administrative Agent or any other Lender any other amount required
to be paid by it hereunder within one Business Day of the date when due, unless
the subject of a good faith dispute, or (c) has been deemed insolvent or become
the subject of a bankruptcy or insolvency proceeding.
"Disposition" or "Dispose" means the sale, transfer, or other
disposition (including any sale and leaseback transaction but excluding other
license or lease arrangements) of any property by any Person (or the granting
of any option or other right to do any of the foregoing), including any sale,
assignment, transfer or other disposal, with or without recourse, of any notes
or accounts receivable or any rights and claims associated therewith.
"Documentation Agent" means Merrill Lynch in its capacity as
documentation agent hereunder.
"Dollar" and "$" mean lawful money of the United States.
"Dollar Honor Date" has the meaning specified in Section 2.03(c)(i).
"Dollar L/C Advance" means, with respect to each U.S. Revolving Credit
Lender, such Lender's funding of its participation in any Dollar L/C Borrowing
in accordance with its Applicable Percentage.
"Dollar L/C Borrowing" means an extension of credit resulting from a
drawing under any Dollar Letter of Credit which has not (a) been reimbursed
within one Business Day following the date when made or (b) refinanced as a
U.S. Revolving Credit Borrowing.
"Dollar L/C Obligations" means, as at any date of determination, the
aggregate amount available to be drawn under all outstanding Dollar Letters of
Credit plus the aggregate of all Unreimbursed Dollar Amounts, including all
Dollar L/C Borrowings. For purposes of computing the amount available to be
drawn under any Dollar Letter of Credit, the amount of such Dollar Letter of
Credit shall be determined in accordance with Section 1.06. For all purposes of
this Agreement, if on any date of determination a Dollar Letter of Credit has
expired by its terms but any amount may still be drawn thereunder by reason of
the operation of Rule 3.14 of the ISP, such Dollar Letter of Credit shall be
deemed to be "outstanding" in the amount so remaining available to be drawn.
"Dollar Letter of Credit" means any letter of credit issued hereunder
that is denominated in Dollars and shall include the Existing Letters of
Credit. A Dollar Letter of Credit may be a commercial letter of credit or a
standby letter of credit.
16
"Dollar Letter of Credit Expiration Date" means the day that is seven
days prior (or such later date determined in the sole discretion of the L/C
Issuer) to the Maturity Date then in effect for the U.S. Revolving Credit
Facility (or, if such day is not a Business Day, the next preceding Business
Day).
"Dollar Letter of Credit Fee" has the meaning specified in Section
2.03(i).
"Dollar Letter of Credit Sublimit" means an amount equal to
$50,000,000. The Dollar Letter of Credit Sublimit is part of, and not in
addition to, the U.S. Revolving Credit Facility. If a Chinese Facility
contemplated by clause (ii) of the definition thereof is entered into, the
Dollar Letter of Credit Sublimit shall be increased by the amount of such
Chinese Facility solely to the extent that a Letter of Credit hereunder is
issued in connection with such Chinese Facility.
"Dollar Swing Line" means the Dollar revolving credit facility made
available by the Swing Line Lender pursuant to Section 2.06.
"Dollar Swing Line Borrowing" means a borrowing of a Dollar Swing Line
Loans pursuant to Section 2.06.
"Dollar Swing Line Loan" has the meaning specified in Section 2.06(a).
"Dollar Swing Line Sublimit" means at any time an amount equal to the
lesser of (a) U.S.$15,000,000 and (b) the U.S. Revolving Credit Facility at
such time. The Dollar Swing Line Sublimit is part of, and not in addition to,
the U.S. Revolving Credit Facility Commitments.
"Dollar Term Borrowing" means a borrowing consisting of simultaneous
Dollar Term Loans of the same Type and, in the case of Eurocurrency Rate Loans,
having the same Interest Period made by each of the Dollar Term Lenders
pursuant to Section 2.01(b).
"Dollar Term Commitment" means, as to each Dollar Term Lender, its
obligation to make Dollar Term Loans to the U.S. Borrower pursuant to Section
2.01(b) in an aggregate principal amount at any one time outstanding not to
exceed the amount set forth opposite such Lender's name on Schedule 2.01 under
the caption "Dollar Term Commitment" or opposite such caption in the Assignment
and Assumption pursuant to which such Lender becomes a party hereto, as
applicable, as such amount may be adjusted from time to time in accordance with
this Agreement.
"Dollar Term Facility" means, at any time, (a) on or prior to the
Closing Date, the aggregate amount of the Dollar Term Commitments at such time
and (b) thereafter, the aggregate principal amount of the Dollar Term Loans of
all Dollar Term Lenders outstanding at such time.
"Dollar Term Lender" means (a) at any time on or prior to the Closing
Date, any Lender that has a Dollar Term Commitment at such time and (b) at any
time after the Closing Date, any Lender that holds Dollar Term Loans at such
time.
17
"Dollar Term Loan" means an advance made by any Dollar Term Lender
under the Dollar Term Facility.
"Dollar Term Note" means a promissory note made by the U.S. Borrower
in favor of a Dollar Term Lender evidencing Dollar Term Loans made by such
Dollar Term Lender, in substantially the form of Exhibit C-1.
"Domestic Subsidiary" means any Subsidiary that is organized under the
laws of any political subdivision of the United States.
"Dormant Subsidiaries" means each of the Closing Date Dormant
Subsidiaries, and any other Subsidiary so designated by the U.S. Borrower in a
certificate to the Administrative Agent as to the matters below, so long as, in
the case of each such Closing Date Dormant Subsidiary and each Subsidiary so
designated, (a) all such Persons do not have consolidated assets with a fair
market value in the aggregate in excess of 2.5% of the Total Assets and (b) any
such Person transacts no business other than business required to maintain such
Person's existence; provided that no Subsidiary may be a Dormant Subsidiary if
the U.S. Borrower or any of its other Subsidiaries provides any credit support
thereto or is liable in any respect for the liabilities thereof greater in the
aggregate than such person's fair market value.
"Eligible Assignee" means (a) a Lender; (b) an Affiliate of a Lender;
(c) an Approved Fund; and (d) any other Person (other than a natural person)
approved by (i) the Administrative Agent, (ii) in the case of any assignment of
a Revolving Commitment, the L/C Issuer and the Swing Line Lender, and (iii)
unless an Event of Default under Sections 8.01(f) or (g) has occurred and is
continuing, the U.S. Borrower (each such approval not to be unreasonably
withheld or delayed); provided that notwithstanding the foregoing, "Eligible
Assignee" shall not include the Borrowers or any of their Affiliates or
Subsidiaries.
"Environmental Action" means any suit, notice of non-compliance or
violation, notice of liability, investigation, proceeding or consent order
relating in any way to any Environmental Law, Environmental Permit or Hazardous
Material.
"Environmental Laws" means any and all Federal, state, local, and
foreign statutes, laws, regulations, ordinances, rules, judgments, orders,
decrees, permits, concessions, grants, franchises, licenses, agreements or
governmental restrictions relating to pollution and the protection of the
environment or the release of any materials into the environment, including
those related to hazardous substances or wastes, air emissions and discharges
to waste or public systems.
"Environmental Liability" means any liability, contingent or otherwise
(including any liability for damages, costs of environmental remediation,
fines, penalties or indemnities), of the Borrowers, any other Loan Party or any
of their respective Subsidiaries directly or indirectly resulting from or based
upon (a) violation of any Environmental Law, (b) the generation, use, handling,
transportation, storage, treatment or disposal of any Hazardous Materials, (c)
exposure to any Hazardous Materials, (d) the release or threatened release of
any Hazardous Materials into the environment or (e) any contract, agreement or
other consensual arrangement pursuant to which liability is assumed or imposed
with respect to any of the foregoing.
18
"Environmental Permit" means any permit, approval, identification
number, license or other authorization required under any Environmental Law.
"Equity Interests" means, with respect to any Person, all of the
shares of capital stock of (or other ownership or profit interests in) such
Person, all of the warrants, options or other rights for the purchase or
acquisition from such Person of shares of capital stock of (or other ownership
or profit interests in) such Person, all of the securities convertible into or
exchangeable for shares of capital stock of (or other ownership or profit
interests in) such Person or warrants, rights or options for the purchase or
acquisition from such Person of such shares (or such other interests), and all
of the other ownership or profit interests in such Person (including
partnership, member or trust interests therein), whether voting or nonvoting,
and whether or not such shares, warrants, options, rights or other interests
are outstanding on any date of determination.
"Equivalent" in Dollars of any Foreign Currency on any date means the
equivalent in Dollars of such Foreign Currency determined by using the
prevailing foreign exchange spot rate of the Administrative Agent and the
"Equivalent" in any Foreign Currency of Dollars on any date means the
equivalent in such Foreign Currency of Dollars determined by using the
prevailing foreign exchange spot rate of the Administrative Agent for such
date.
"ERISA" means the Employee Retirement Income Security Act of 1974.
"ERISA Affiliate" means any trade or business (whether or not
incorporated) under common control with the U.S. Borrower within the meaning of
Section 414(b) or (c) of the Code (and Sections 414(m) and (o) of the Code for
purposes of provisions relating to Section 412 of the Code).
"ERISA Event" means (a) a Reportable Event with respect to a Pension
Plan; (b) a withdrawal by the U.S. Borrower or any ERISA Affiliate from a
Pension Plan subject to Section 4063 of ERISA during a plan year in which it
was a substantial employer (as defined in Section 4001(a)(2) of ERISA) or a
cessation of operations that is treated as such a withdrawal under Section
4062(e) of ERISA; (c) a complete or partial withdrawal by the U.S. Borrower or
any ERISA Affiliate from a Multiemployer Plan, or notification that a
Multiemployer Plan is in reorganization or has been terminated, within the
meaning of Title IV of ERISA; (d) the filing of a notice of intent to
terminate, the treatment of a Pension Plan amendment as a termination under
Sections 4041 or 4041A of ERISA, or the commencement of proceedings by the PBGC
to terminate a Pension Plan or Multiemployer Plan; (e) an event or condition
which constitutes grounds under Section 4042 of ERISA for the termination of,
or the appointment of a trustee to administer, any Pension Plan or
Multiemployer Plan; (f) the application for a minimum funding waiver with
respect to a Pension Plan; (g) the imposition of any liability under Title IV
of ERISA, other than for PBGC premiums due but not delinquent under Section
4007 of ERISA, upon the U.S. Borrower or any ERISA Affiliate; or (h) any other
event similar to those described under (a) - (g) with respect to any Foreign
Plan.
"Euro" and "(euro)" means the single currency of the participating
members of the European Union.
19
"Euro Borrower" has the meaning specified in the introductory
paragraph hereto.
"Euro Honor Date" has the meaning specified in Section 2.04(c)(i).
"Euro L/C Advance" means, with respect to each Euro Revolving Credit
Lender, such Lender's funding of its participation in any Euro L/C Borrowing in
accordance with its Applicable Percentage.
"Euro L/C Borrowing" means an extension of credit resulting from a
drawing under any Euro Letter of Credit which has not (a) been reimbursed
within one Business Day following the date when made or (b) refinanced as a
Euro Revolving Credit Borrowing.
"Euro L/C Obligations" means, as at any date of determination, the
aggregate amount available to be drawn under all outstanding Euro Letters of
Credit plus the aggregate of all Unreimbursed Euro Amounts, including all Euro
L/C Borrowings. For purposes of computing the amount available to be drawn
under any Euro Letter of Credit, the amount of such Euro Letter of Credit shall
be determined in accordance with Section 1.06. For all purposes of this
Agreement, if on any date of determination a Euro Letter of Credit has expired
by its terms but any amount may still be drawn thereunder by reason of the
operation of Rule 3.14 of the ISP, such Euro Letter of Credit shall be deemed
to be "outstanding" in the amount so remaining available to be drawn.
"Euro Letter of Credit" means any letter of credit issued hereunder
that is denominated in Euros. A Euro Letter of Credit may be a commercial
letter of credit or a standby letter of credit.
"Euro Letter of Credit Expiration Date" means the day that is seven
days prior (or such later date determined in the sole discretion of the L/C
Issuer) to the Maturity Date then in effect for the Euro Revolving Credit
Facility (or, if such day is not a Business Day, the next preceding Business
Day).
"Euro Letter of Credit Fee" has the meaning specified in Section
2.04(i).
"Euro Letter of Credit Sublimit" means an amount equal to the Euro
Revolving Credit Facility. The Euro Letter of Credit Sublimit is part of, and
not in addition to, the Euro Revolving Credit Facility.
"Euro Reduction Amount" has the meaning set forth in Section
2.07(b)(ix).
"Euro Revolving Credit Borrowing" means a borrowing consisting of
simultaneous Euro Revolving Credit Loans to the Euro Borrower having the same
Interest Period made by each of the Euro Revolving Credit Lenders pursuant to
Section 2.01(e).
"Euro Revolving Credit Commitment" means, as to each Euro Revolving
Credit Lender, its obligation to (a) make Euro Revolving Credit Loans to the
Euro Borrower pursuant to Section 2.01(e), (b) purchase participations in Euro
L/C Obligations and (c) purchase participations in Euro Swing Line Loans, in an
aggregate principal amount at any one time outstanding not to exceed the amount
set forth opposite such Lender's name on Schedule 2.01
20
under the caption "Euro Revolving Credit Commitment" or opposite such caption
in the Assignment and Assumption pursuant to which such Lender becomes a party
hereto, as applicable, as such amount may be adjusted from time to time in
accordance with this Agreement.
"Euro Revolving Credit Facility" means, at any time, the aggregate
amount of the Euro Revolving Credit Lenders' Euro Revolving Credit Commitments
at such time.
"Euro Revolving Credit Lender" means, at any time, any Lender that has
a Euro Revolving Credit Commitment at such time.
"Euro Revolving Credit Loan" has the meaning specified in Section
2.01(e).
"Euro Revolving Credit Note" means a promissory note made by the Euro
Borrower in favor of a Euro Revolving Credit Lender evidencing Euro Revolving
Credit Loans or Euro Swing Line Loans, as the case may be, made by such Euro
Revolving Credit Lender, in substantially the form of Exhibit C-3.
"Euro Swing Line" means the Euro revolving credit facility made
available by the Swing Line Lender pursuant to Section 2.06.
"Euro Swing Line Borrowing" means a borrowing of a Euro Swing Line
Loans pursuant to Section 2.06.
"Euro Swing Line Loan" has the meaning specified in Section 2.06(b).
"Euro Swing Line Sublimit" means at any time an amount equal to the
lesser of (a) (euro)5,000,000 and (b) the Euro Revolving Credit Facility at
such time. The Euro Swing Line Sublimit is part of, and not in addition to, the
Euro Revolving Credit Facility Commitments.
"Euro Term Borrowing" means a borrowing consisting of simultaneous
Euro Term Loans having the same Interest Period made by each of the Euro Term
Lenders pursuant to Section 2.01(c).
"Euro Term Commitment" means, as to each Euro Term Lender, its
obligation to make Euro Term Loans to the U.S. Borrower pursuant to Section
2.01(c) in an aggregate principal amount at any one time outstanding not to
exceed the amount set forth opposite such Lender's name on Schedule 2.01 under
the caption "Euro Term Commitment" or opposite such caption in the Assignment
and Assumption pursuant to which such Lender becomes a party hereto, as
applicable, as such amount may be adjusted from time to time in accordance with
this Agreement.
"Euro Term Facility" means, at any time, (a) on or prior to the
Closing Date, the aggregate amount of the Euro Term Commitments at such time
and (b) thereafter, the aggregate principal amount of the Euro Term Loans of
all Euro Term Lenders outstanding at such time.
21
"Euro Term Lender" means (a) at any time on or prior to the Closing
Date, any Lender that has a Euro Term Commitment at such time and (b) at any
time after the Closing Date, any Lender that holds Euro Term Loans at such
time.
"Euro Term Loan" means an advance made by any Euro Term Lender under
the Euro Term Facility.
"Euro Term Note" means a promissory note made by the U.S. Borrower in
favor of a Euro Term Lender evidencing Euro Term Loans made by such Euro Term
Lender, in substantially the form of Exhibit C-1.
"Eurocurrency Rate" means, for any Interest Period, with respect to a
Eurocurrency Rate Loan, the rate per annum (rounded upward, if necessary, to
the next 1/100th of 1%) determined by the Administrative Agent as follows:
Eurocurrency Base Rate
Eurocurrency Rate = --------------------------------------
1.00 - Eurocurrency Reserve Percentage
Where,
"Eurocurrency Base Rate" means, for such Interest Period, the rate per
annum equal to the British Bankers Association LIBOR Rate ("BBA LIBOR"), as
published by Reuters (or other commercially available source providing
quotations of BBA LIBOR as designated by the Administrative Agent from time to
time) at approximately 11.00 a.m., London time, two Business Days prior to the
commencement of such Interest Period, for deposits in Dollars or the applicable
Foreign Currency other than Pounds Sterling and at approximately 11:00a.m.
London time on the first day of such Interest Period for deposits in Pound
Sterling (in each case, for delivery on the first day of such Interest Period)
with a term equivalent to such Interest Period. If such rate is not available
at such time for any reason, then the "Eurocurrency Base Rate" for such
Interest Period shall be the rate per annum determined by the Administrative
Agent to be the rate at which deposits in Dollars or the applicable Foreign
Currency for delivery on the first day of such Interest Period in same day
funds in the approximate amount of the Eurocurrency Rate Loan being made,
continued or converted by Bank of America and with a term equivalent to such
Interest Period would be offered by Bank of America's London Branch to major
banks in the London interbank eurocurrency market at their request at
approximately 11:00 a.m. (London time) two Business Days prior to the first day
of such Interest Period.
"Eurocurrency Rate Loan" means a Loan that bears interest at a rate
based on the Eurocurrency Rate.
"Eurocurrency Reserve Percentage" means for any day during any
Interest Period the reserve percentage (expressed as a decimal, carried out to
five decimal places) in effect on such day, whether or not applicable to any
Lender, under regulations issued from time to time by the FRB for determining
the maximum reserve requirement (including any emergency, supplemental or other
marginal reserve requirement) with respect to Eurocurrency funding (currently
referred to as "Eurocurrency liabilities"). The Eurocurrency Rate for each
22
outstanding Eurocurrency Rate Loan shall be adjusted automatically as of the
effective date of any change in the Eurocurrency Reserve Percentage.
"Eurodollar Rate Loan" means any Eurocurrency Loan denominated in
Dollars.
"Event of Default" has the meaning specified in Section 8.01.
"Excess Cash Flow" means, for any period, the remainder of
(a) the sum of (i) Consolidated EBITDA for such period
plus
----
(ii) the aggregate amount of all extraordinary cash gains
received by the U.S. Borrower and its Subsidiaries during such period
less
----
(b) the sum, without duplication, of
(i) repayments of principal of Term Loans pursuant to Section
2.08, scheduled principal payments arising with respect to any other
long-term Indebtedness of the U.S. Borrower and its Subsidiaries, and the
portion of any scheduled payments with respect to Capital Leases allocable
to principal, in each case made during such period,
plus
----
(ii) voluntary prepayments of the Term Loans pursuant to
Section 2.07(a), voluntary principal prepayments arising with respect to
any other Indebtedness of the U.S. Borrower and its Subsidiaries and
permanently reducing such Indebtedness, and the portion of any voluntary
prepayments with respect to Capital Leases allocable to principal, in each
case to the extent permitted hereunder and made during such period,
plus
----
(iii) mandatory prepayments of the Term Loans pursuant to
Section 2.07(b)(ii), (iii) and (iv) made during such period to the
extent that the applicable Net Cash Proceeds applied to such mandatory
prepayments were taken into account in calculating Consolidated EBITDA
for such period,
plus
----
(iv) cash payments made in such period with respect to Capital
Expenditures,
plus
----
23
(v) all federal, state, local and foreign Taxes paid by the
U.S. Borrower and its Subsidiaries during such period,
plus
----
(vi) the cash component of Consolidated Interest Charges of the
U.S. Borrower and its Subsidiaries during such period,
plus
----
(vii) cash Restricted Payments permitted under Section 7.06 and
paid by the U.S. Borrower and its Subsidiaries during such period,
plus
----
(viii) non-recurring cash charges (including, without limitation,
cash Restructuring Charges),
plus
----
(ix) proceeds received by or on behalf of the U.S. Borrower and
its Subsidiaries from insurance claims with respect to casualty events,
business interruption or product recalls which reimburse prior business
expenses, to the extent such proceeds were taken into account when
calculating Consolidated EBITDA for such period,
plus
----
(x) cash expenses or charges incurred in connection with or in
contemplation of any Investment permitted under Section 7.03, issuance of
Equity Interests permitted hereunder and issuance or incurrence of
Indebtedness permitted by Section 7.02 (whether or not consummated),
plus
----
(xi) to the extent not deducted in calculating Consolidated
EBITDA, fees and expenses (including any applicable premium) in connection
with the Refinancing or exchanges, redemptions or refinancings permitted
by this Agreement, in each case to the extent incurred during such period,
plus
----
(xii) cash expenses incurred in connection with deferred
compensation arrangements in connection with the Nu-Gro Transaction and
the UPG Acquisition,
plus
----
(xiii) cash from operations used to consummate a Permitted
Acquisition,
plus
----
24
(xiv) Net Cash Proceeds of permitted equity issuances, to the
extent such proceeds were taken into account when calculating Consolidated
EBITDA for such period,
plus
----
(xv) Net Cash Proceeds received during such period pending
reinvestment in accordance with the provisions of Section 2.07(b), to the
extent such proceeds were taken into account when calculating Consolidated
EBITDA for such period
plus
----
(xvi) cash payments made in satisfaction of non-current
liabilities,
plus
----
(xvii) the aggregate amount of all extraordinary cash charges
made by the Borrower and its Subsidiaries during such period plus/minus
changes in working capital.
"Excluded Taxes" means, with respect to the Administrative Agent, any
Lender, the L/C Issuer or any other recipient of any payment to be made by or
on account of any obligation of the Borrowers hereunder, (a) Taxes imposed on
or measured by its overall net income (however denominated), and franchise
Taxes imposed on it (in lieu of net income Taxes), by the jurisdiction (or any
political subdivision thereof) under the laws of which such recipient is
organized or in which its principal office is located or in which it otherwise
does business or, in the case of any Lender, in which its applicable Lending
Office is located or in which it otherwise does business, (b) any branch
profits taxes imposed by the United States or any similar Tax imposed by any
other jurisdiction in which the Borrowers are located, (c) in the case of a
Foreign Lender (other than an assignee pursuant to a request by a Borrower
under Section 10.14), any (i) United States withholding tax with respect to the
U.S. Borrower, (ii) German withholding tax with respect to the Euro Borrower
and (iii) United Kingdom withholding tax with respect to the UK Borrower, in
each case that is imposed on amounts payable to such Foreign Lender at the time
such Foreign Lender becomes a party hereto (or designates a new Lending Office)
or is attributable to such Foreign Lender's failure or inability (other than as
a result of a Change in Law) to comply with Section 3.01(f), except to the
extent that such Foreign Lender (or its assignor, if any) was entitled, at the
time of designation of a new Lending Office (or assignment), to receive
additional amounts from the applicable Borrower with respect to such Tax
pursuant to Section 3.01(a) and (d) in the case of a Lender that is neither a
Foreign Lender nor a Lender in respect of a Loan made to a Borrower
incorporated in the United Kingdom (to which the provisions of Section 3.01(h)
apply), in each case other than an assignee pursuant to a request by a Borrower
under Section 10.14, any Tax that is imposed on amounts payable to such Lender
at the time such Lender becomes a party hereto (or designates a new Lending
Office) or is attributable to such Lender's failure or inability (other than as
a result of a Change in Law) to comply with Section 3.01(f), except to the
extent that such Lender (or its assignor, if any) was
25
entitled at the time of designation of a new Lending Office (or assignment), to
receive additional amounts from the applicable Borrower with respect to such
Tax pursuant to Section 3.01(a).
"Existing Letters of Credit" means the letters of credit outstanding
under the Existing Rayovac Credit Agreement and the Existing UIC Credit
Agreement, as set forth on Schedule V.
"Existing Rayovac Credit Agreement" means has the meaning specified in
the preliminary statements hereto.
"Existing UIC Credit Agreement" means that certain Amended and
Restated Credit Agreement dated as of July 30, 2004 among UIC as borrower, Bank
of America, N.A. as administrative agent, and the lenders party thereto.
"Facility" means the Canadian Term Facility, the Dollar Term Facility,
the Euro Term Facility, the U.S. Revolving Credit Facility, the Euro Revolving
Credit Facility, the UK Revolving Credit Facility, the Dollar Swing Line
Sublimit, the Euro Swing Line Sublimit, the UK Swing Line Sublimit, the Dollar
Letter of Credit Sublimit, the Euro Letter of Credit Sublimit or the UK Letter
of Credit Sublimit, as the context may require.
"Federal Funds Rate" means, for any day, the 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 on such
day, as published by the Federal Reserve Bank of New York on the Business Day
next succeeding such day; provided that (a) if such day is not a Business Day,
the Federal Funds Rate for such day shall be such rate on such transactions on
the next preceding Business Day as so published on the next succeeding Business
Day, and (b) if no such rate is so published on such next succeeding Business
Day, the Federal Funds Rate for such day shall be the average rate (rounded
upward, if necessary, to a whole multiple of 1/100 of 1%) charged to Bank of
America on such day on such transactions as determined by the Administrative
Agent.
"Fee Letter" means the letter agreement, dated January 3, 2005 among
the U.S. Borrower, the Administrative Agent and the Joint Book Managers.
"Fitch" means Fitch Ratings and any successor thereto.
"Foreign Collateral Documents" means the Canadian Share Pledge, the
Netherlands Share Pledge, the Caymans Share Charges, the German Account Pledge
Agreement, the German Share Pledges, the German Global Assignment Agreement,
the German Security Transfer Agreement and any other Collateral Document
governed by laws other than laws of the U.S. or a subdivision thereof.
"Foreign Currency" means Euro, Canadian Dollars or Pounds Sterling.
"Foreign Government Scheme or Arrangement" has the meaning specified
in Section 5.12(d).
26
"Foreign Lender" means any Lender that is organized under the laws of
a jurisdiction other than the United States, each State thereof and the
District of Columbia.
"Foreign Plan" has the meaning specified in Section 5.12(c).
"FRB" means the Board of Governors of the Federal Reserve System of
the United States.
"Fund" means any Person (other than a natural person) that is (or will
be) engaged in making, purchasing, holding or otherwise investing in commercial
loans and similar extensions of credit in the ordinary course of its business.
"GAAP" means generally accepted accounting principles in the United
States set forth in the opinions and pronouncements of the Accounting
Principles Board and the American Institute of Certified Public Accountants and
statements and pronouncements of the Financial Accounting Standards Board or
such other principles as may be approved by a significant segment of the
accounting profession in the United States, which are applicable to the
circumstances as of the date of determination.
"German Account Pledge Agreement" means the account pledge agreement
to be entered into with respect to the accounts of the Euro Borrower.
"German Collateral Agreement" means any Foreign Collateral Document
governed by the Laws of the Federal Republic of Germany.
"German Finance Co." means ROV German Finance GmbH.
"German Global Assignment" means the Global Assignment Agreement dated
as of October 1, 2002 (as amended by the Global Amendment Agreement dated as of
the Closing Date) between the Euro Borrower, as assignor, and the
Administrative Agent, as assignee.
"German Loan Party" has the meaning specified in Section 7.20.
"German Security Interest" has the meaning specified in Section
9.02(a).
"German Security Transfer Agreement" means the Security Transfer
Agreement dated as of October 1, 2002 (as amended by the Global Amendment
Agreement dated as of the Closing Date) between the Euro Borrower, as
transferor, and the Administrative Agent, as transferee.
"German Share Pledges" means, collectively, (a) one or more share
pledges to be entered into with respect to the Equity Interests of (i) ROV
German General Partner GmbH, (ii) ROV German Limited GmbH, and (iii) the Euro
Borrower and (b) the Rayovac Europe GmbH Share Pledge."
"Governmental Authority" means the government of the United States or
any other nation, or of any political subdivision thereof, whether state or
local, and any agency, authority, instrumentality, regulatory body, court,
central bank or other entity exercising
27
executive, legislative, judicial, taxing, regulatory or administrative powers
or functions of or pertaining to government (including any supra-national
bodies such as the European Union or the European Central Bank).
"Granting Lender" has the meaning specified in Section 10.06(h).
"Guarantee" means, as to any Person, any (a) any obligation,
contingent or otherwise, of such Person guaranteeing or having the economic
effect of guaranteeing any Indebtedness payable or performable by another
Person (the "primary obligor") in any manner, whether directly or indirectly,
and including any obligation of such Person, direct or indirect, (i) to
purchase or pay (or advance or supply funds for the purchase or payment of)
such Indebtedness or other obligation, (ii) to purchase or lease property,
securities or services for the purpose of assuring the obligee in respect of
such Indebtedness or other obligation of the payment or performance of such
Indebtedness or other obligation, (iii) to maintain working capital, equity
capital or any other financial statement condition or liquidity or level of
income or cash flow of the primary obligor so as to enable the primary obligor
to pay such Indebtedness or other obligation, or (iv) entered into for the
purpose of assuring in any other manner the obligee in respect of such
Indebtedness or other obligation of the payment or performance thereof or to
protect such obligee against loss in respect thereof (in whole or in part), or
(b) any Lien on any assets of such Person securing any Indebtedness or other
obligation of any other Person, whether or not such Indebtedness or other
obligation is assumed by such Person (or any right, contingent or otherwise, of
any holder of such Indebtedness to obtain any such Lien). The amount of any
Guarantee shall be deemed to be an amount equal to the stated or determinable
amount of the related primary obligation, or portion thereof, in respect of
which such Guarantee is made or, if not stated or determinable, the maximum
reasonably anticipated liability in respect thereof as determined by the
guaranteeing Person in good faith. The term "Guarantee" as a verb has a
corresponding meaning.
"Guarantors" means, collectively, the ROV Guarantors, the KGaA
Guarantors, the UK Guarantors and each other Subsidiary of the U.S. Borrower
that shall be required to execute and deliver a guaranty or guaranty supplement
pursuant to Section 6.12.
"Hazardous Materials" means all radioactive substances, radioactive
wastes, hazardous or toxic substances, hazardous or toxic wastes, or other
pollutants, including petroleum or petroleum distillates, asbestos or
asbestos-containing materials, polychlorinated biphenyls, radon gas, hazardous
materials and all other substances or wastes of any nature regulated as
hazardous, toxic or pollutants pursuant to any Environmental Law.
"Hedge Bank" means any Person that is a Lender or an Affiliate of a
Lender, in its capacity as a party to a Secured Hedge Agreement.
"Increase Date" has the meaning specified in Section 2.16(a).
"Increasing Lender" has the meaning specified in Section 2.16(b).
"Incremental Commitments" has the meaning specified in Section
2.16(a).
"Incremental Facility" has the meaning specified in Section 2.16(a).
28
"Incremental Revolving Credit Facility" has the meaning specified in
Section 2.16(a).
"Incremental Term Facility" has the meaning specified in Section
2.16(a).
"Indebtedness" means, as to any Person at a particular time, without
duplication, all of the following, each to the extent treated as indebtedness
or liabilities in accordance with GAAP:
(a) all indebtedness of such Person for borrowed money and all
obligations of such Person evidenced by bonds, debentures, notes, loan
agreements or other similar instruments;
(b) the maximum amount of all direct or contingent obligations of such
Person arising under letters of credit (including standby and commercial),
bankers' acceptances, bank guaranties, surety bonds and similar
instruments;
(c) all obligations of such Person to pay the deferred purchase price
of property or services (other than trade accounts and accrued expenses
payable in the ordinary course of business);
(d) indebtedness (excluding prepaid interest thereon) secured by a
Lien on property owned or being purchased by such Person (including
indebtedness arising under conditional sales or other title retention
agreements) in an amount up to the lesser of the amount of indebtedness so
secured and the fair market value of the property securing such
indebtedness, whether or not such indebtedness shall have been assumed by
such Person or is limited in recourse;
(e) all Attributable Indebtedness;
(f) all obligations of such Person to purchase, redeem, retire,
defease or otherwise make any cash payment in respect of any Equity
Interest in such Person or any other Person or any warrant, right or
option to acquire such Equity Interest, valued, in the case of a
redeemable preferred interest, at the greater of its voluntary or
involuntary liquidation preference plus accrued and unpaid dividends; and
(g) all Guarantees of such Person in respect of any of the foregoing.
For all purposes hereof, the Indebtedness of any Person shall include
the Indebtedness of any partnership or joint venture (other than a joint
venture that is itself a corporation or limited liability company) in which
such Person is a general partner or a joint venturer, unless such Indebtedness
is expressly made non-recourse to such Person.
"Indemnified Taxes" means Taxes arising from any payment hereunder or
under any other Loan Document other than Excluded Taxes.
"Indemnitees" has the meaning specified in Section 10.04(b).
29
"Information" has the meaning specified in Section 10.07.
"Information Memorandum" means the Information Memorandum dated
January 2005 used by the Arrangers in connection with the syndication of the
Commitments.
"Intellectual Property Security Agreement" has the meaning specified
in Section 4.01(a)(iv).
"Interest Payment Date" means, (a) as to any Loan other than a Base
Rate Loan, the last day of each Interest Period applicable to such Loan and the
Maturity Date of the Facility under which such Loan was made; provided,
however, that if any Interest Period for a Eurocurrency Rate Loan exceeds three
months, the respective dates that fall every three months after the beginning
of such Interest Period shall also be Interest Payment Dates; and (b) as to any
Base Rate Loan (including a Dollar Swing Line Loan), the last Business Day of
each March, June, September and December and the Maturity Date of the Facility
under which such Loan was made.
"Interest Period" means, as to each Eurocurrency Rate Loan, the period
commencing on the date such Eurocurrency Rate Loan is disbursed or converted to
or continued as a Eurocurrency Rate Loan and ending on the date one, two, three
or six months thereafter, as selected by the applicable Borrower in its
Committed Loan Notice or, to the extent available to all applicable Lenders,
nine or twelve months thereafter or, in respect of the initial Credit Extension
and solely to the extent provided in Section 2.02(f), 64 days or 98 days
thereafter; provided that:
(a) any Interest Period that would otherwise end on a day that is not
a Business Day shall be extended to the next succeeding Business Day
unless (i) such Business Day falls in another calendar month or (ii) such
Business Day falls more than 365 days after the commencement of such
Interest Period (or if such Interest Period includes February 29, 366
days), in which case such Interest Period shall end on the next preceding
Business Day;
(b) any Interest Period that begins on the last Business Day of a
calendar month (or on a day for which there is no numerically
corresponding day in the calendar month at the end of such Interest
Period) shall end on the last Business Day of the calendar month at the
end of such Interest Period; and
(c) no Interest Period shall extend beyond the Maturity Date of the
Facility under which such Loan was made.
"Internal Control Event" means a material fraud that involves
management employees who have a significant role in the U.S. Borrower's
internal controls over financial reporting, in each case as described in the
Securities Laws.
"Investment" means, as to any Person, any direct or indirect
acquisition or investment by such Person, whether by means of (a) the purchase
or other acquisition of Equity Interests of another Person, (b) a loan, advance
or capital contribution to, Guarantee or assumption of debt of, or purchase or
other acquisition of any other debt interest in, another
30
Person, or (c) the purchase or other acquisition (in one transaction or a
series of transactions) of assets of another Person that constitute a business
unit or all or a substantial part of the business of, such Person. For purposes
of covenant compliance, the amount of any Investment shall be the amount
actually invested, without adjustment for subsequent increases or decreases in
the value of such Investment.
"IP Rights" has the meaning specified in Section 5.16.
"IP Security Agreement Supplement" has the meaning specified in
Section 12(f) of the Security Agreement.
"IRB Debt" means Indebtedness of the U.S. Borrower arising as a result
of the issuance of tax-exempt industrial revenue bonds or similar tax-exempt
public financing.
"IRS" means the United States Internal Revenue Service.
"ISP" means, with respect to any Letter of Credit, the "International
Standby Practices 1998" published by the Institute of International Banking Law
& Practice (or such later version thereof as may be in effect at the time of
issuance).
"Issuer Documents" means with respect to any Letter of Credit, the
Letter of Credit Application, and any other document, agreement and instrument
entered into by the L/C Issuer and any Borrower (or any Subsidiary) or in favor
of the L/C Issuer and relating to any such Letter of Credit.
"KGaA Guarantors" means, collectively, the U.S. Borrower, the
Subsidiaries of the U.S. Borrower listed on Schedule I and each other
Subsidiary of the U.S. Borrower that shall be required to execute and deliver a
guaranty or guaranty supplement pursuant to Section 6.12(a)(i)(B).
"KGaA Guaranty" means, collectively, the KGaA Guaranty made by the
KGaA Guarantors in favor of the Administrative Agent, the L/C Issuers and the
Lenders, substantially in the form of Exhibit F-2, together with each other
guaranty and guaranty supplement delivered pursuant to Section 6.12(a)(i)(B).
"Laws" means, collectively, all international, foreign, Federal, state
and local statutes, treaties, rules, regulations, ordinances and codes, and all
applicable administrative orders and agreements with, any Governmental
Authority, in each case having the force of law.
"L/C Advance" means, as the context may require, any or all of the
Dollar L/C Advances, Euro L/C Advances and UK L/C Advances.
"L/C Borrowing" means as the context may require, any or all of the
Dollar L/C Borrowings, Euro L/C Borrowings or UK L/C Borrowings.
"L/C Credit Extension" means, with respect to any Letter of Credit,
the issuance thereof or extension of the expiry date thereof, or the increase
of the amount thereof.
31
"L/C Issuer" means Bank of America in its capacity as issuer of
Letters of Credit hereunder, or any successor issuer of Letters of Credit
hereunder.
"L/C Obligations" means, any or all of, as the context may require,
the Dollar L/C Obligations, Euro L/C Obligations or UK L/C Obligations.
"Lender" has the meaning specified in the introductory paragraph
hereto and, as the context requires, includes the Swing Line Lender.
"Lending Office" means, as to any Lender, the office or offices of
such Lender described as such in such Lender's Administrative Questionnaire, or
such other office or offices as a Lender may from time to time notify the
Borrowers under the Facilities as to which such Lender has a Commitment and the
Administrative Agent.
"Letter of Credit" means, as the context requires, one or all of
Dollar Letters of Credit, Euro Letters of Credit and UK Letters of Credit.
"Letter of Credit Application" means an application and agreement for
the issuance or amendment of a Letter of Credit in the form from time to time
in use by the L/C Issuer.
"Letter of Credit Expiration Date" means, as the context requires, the
Dollar Letter of Credit Expiration Date, the Euro Letter of Credit Expiration
Date, or the UK Letter of Credit Expiration Date.
"Letter of Credit Fee" means any or all of (as the context requires) a
Dollar Letter of Credit Fee, Euro Letter of Credit Fee or UK Letter of Credit
Fee.
"Letter of Credit Sublimit" means, as the context may require, the
Dollar Letter of Credit Sublimit, the Euro Letter of Credit Sublimit or the UK
Letter of Credit Sublimit.
"Lien" means any mortgage, pledge, hypothecation, assignment, deposit
arrangement, encumbrance, lien (statutory or other), charge, or preference,
priority or other security interest or preferential arrangement in the nature
of a security interest of any kind (including any conditional sale or other
title retention agreement, any easement, right of way or other encumbrance on
title to real property, and any financing lease having substantially the same
economic effect as any of the foregoing but not including the interest of a
lessor under an operating lease).
"Loan" means an extension of credit by a Lender to a Borrower under
Article II in the form of a Term Loan, a Revolving Credit Loan or a Swing Line
Loan.
"Loan Documents" means, collectively, (a) this Agreement, (b) the
Notes, (c) the ROV Guaranty, (d) the KGaA Guaranty, (e) the UK Guaranty, (f)
the Collateral Documents, (g) the Fee Letter, (h) each Issuer Document, (i)
each Secured Hedge Agreement and (j) each agreement evidencing a Qualified
Foreign Credit Facility or a Guarantee thereof; provided, that for purposes of
Articles IV through VIII, "Loan Documents" shall not include Secured Hedge
Agreements or agreements evidencing Qualified Foreign Credit Facilities or a
Guarantee thereof.
32
"Loan Parties" means, collectively, each Borrower and each Guarantor.
"Managing Agent" means Merrill Lynch in its capacity as managing
agent.
"Material Adverse Effect" means (a) a material adverse change in, or a
material adverse effect upon, the operations, business, assets or condition
(financial or otherwise) of the U.S. Borrower and its Subsidiaries, taken as a
whole; (b) a material impairment of the rights and remedies of the
Administrative Agent or any Lender under any Loan Document, or of the ability
of the Loan Parties, taken as a whole, to perform the obligations under the
Loan Documents; or (c) as of the Closing Date, a reasonable expectation of the
Arrangers that the Senior Credit Facilities, the Acquisition or the Merger,
could be materially adversely affected.
"Maturity Date" means (a) with respect to the U.S. Revolving Credit
Facility, the earlier of (i) February 6, 2011 and (ii) the date of termination
in whole of the U.S. Revolving Credit Commitments pursuant to Section 2.08 or
8.02, (b) with respect to the Euro Revolving Credit Facility, the earlier of
(i) February 6, 2011 and (ii) the date of termination in whole of the Euro
Revolving Credit Commitments pursuant to Section 2.08 or 8.02, (c) with respect
to the UK Revolving Credit Facility, the earlier of (i) February 6, 2011 and
(ii) the date of termination in whole of the UK Revolving Credit Commitments
pursuant to Section 2.08 or 8.02 and (d) with respect to each of the Term
Facilities, the earlier of (i) February 6, 2012 and (ii) the date of
termination in whole of the Term Commitments pursuant to Section 2.08 or 8.02.
"Maximum Rate" has the meaning specified in Section 10.10.
"Merger" has the meaning specified in the Preliminary Statements to
this Agreement.
"Merger Agreement" has the meaning specified in the Preliminary
Statements to this Agreement.
"Merrill Lynch" means Merrill Lynch Capital Corporation and its
successors.
"MLPF&S" means Merrill Lynch, Pierce, Fenner & Smith and its
successors.
"Moody's" means Moody's Investors Service, Inc. and any successor
thereto.
"Mortgage" has the meaning specified in Section 6.18(a).
"Mortgage Amendment" means an amendment, substantially in the form of
Exhibit H-2, to a Mortgage previously executed by any Loan Party or Subsidiary.
"Mortgage Policy" has the meaning specified in Section 6.18(a).
"Mortgage Properties" shall mean the fee owned real properties and the
leasehold interests listed on Schedule 6.18 hereto.
33
"Multiemployer Plan" means any employee benefit plan of the type
described in Section 4001(a)(3) of ERISA, to which the U.S. Borrower or any
ERISA Affiliate makes or is obligated to make contributions.
"Net Cash Proceeds" means:
(a) with respect to any Disposition by the U.S. Borrower or
any of its Subsidiaries, the excess, if any, of (i) the sum of cash
and Cash Equivalents received in connection with such transaction
(including any cash or Cash Equivalents received by way of deferred
payment pursuant to, or by monetization of, a note receivable or
otherwise, but only as and when so received) over (ii) the sum of (A)
the principal amount of any Indebtedness that is secured by the
applicable asset or owed by a Subsidiary and that is required to be
repaid in connection with such transaction (other than Indebtedness
under the Loan Documents), together with any interest, premium or
penalties required to be paid in connection therewith, (B) the direct
costs and expenses (including sales commissions and legal, accounting
and investment banking fees but excluding costs and expenses owed to
any Affiliate of the U.S. Borrower (other than THLee)) incurred by the
U.S. Borrower or such Subsidiary in connection with such transaction,
(C) Taxes reasonably estimated to be actually payable within two years
of the date of the relevant transaction as a result of any gain
recognized in connection therewith and (D) any reserve for adjustment
in respect of (x) sale price of such assets established in accordance
with GAAP and (y) any liabilities associated with such asset or assets
and retained by the Borrowers or any of their respective Subsidiaries
after such sale or other disposition thereof, including, without
limitation, pension and other post-employment benefit liabilities and
liabilities related to environmental matters or against any
indemnifications obligations associated with such transaction; and
(b) with respect to the incurrence or issuance of any
Indebtedness by the U.S. Borrower or any of its Subsidiaries, the
excess of (i) the sum of the cash and Cash Equivalents received in
connection with such transaction over (ii) the sales and underwriting
discounts, fees and commissions, and other direct costs and expenses
(including legal, accounting and investment banker fees), incurred by
the U.S. Borrower or such Subsidiary in connection therewith.
"Netherlands Share Pledge" means the share pledge to be entered into
in respect of the Equity Interests of Varta B.V., in form and substance
satisfactory to the Administrative Agent.
"Newco" has the meaning specified in the Preliminary Statements to
this Agreement.
"Non-Consenting Lender" has the meaning specified in Section 10.01.
"Non-Dollar Letters of Credit" means the Existing Letters of Credit
listed on Schedule V that are denominated in a currency other than Dollars.
"NonExtension Notice Date" has the meaning specified in Section
2.03(b)(iii).
34
"Note" means a Term Note or a Revolving Credit Note, as the context
may require.
"NPL" means the National Priorities List under CERCLA.
"NuGro Transaction" means the acquisition by UIC of all the equity
interests of The Nu-Gro Corporation, an Ontario corporation, as consummated on
April 30, 2004, and each of the related transactions entered into on April 30,
2004, in each case, as permitted under and specified by that certain Credit
Agreement dated as of April 30, 2004 among UIC, as borrower, certain banks,
financial institutions and other institutional lenders party thereto and Bank
of America, as administrative agent for the lenders thereunder.
"Obligations" means all advances to, and debts, liabilities,
obligations, covenants and duties of, any Loan Party arising under any Loan
Document or otherwise with respect to any Loan or Letter of Credit, whether
direct or indirect (including those acquired by assumption), absolute or
contingent, due or to become due, now existing or hereafter arising and
including interest and fees that accrue after the commencement by or against
any Loan Party or any Affiliate thereof of any proceeding under any Debtor
Relief Laws naming such Person as the debtor in such proceeding, regardless of
whether such interest and fees are allowed claims in such proceeding.
"OECD" means the Organization for Economic Cooperation and
Development.
"OECD Member" means a country that signed or ratified the Convention
on the Organisation for Economic Cooperation and Development and is thus a
member of OECD.
"Organization Documents" means, (a) with respect to any corporation,
the certificate or articles of incorporation and the bylaws (or equivalent or
comparable constitutive documents with respect to any non-U.S. jurisdiction);
(b) with respect to any limited liability company, the certificate or articles
of formation or organization and operating agreement; and (c) with respect to
any partnership, joint venture, trust or other form of business entity, the
partnership, joint venture or other applicable agreement of formation or
organization and any agreement, instrument, filing or notice with respect
thereto filed in connection with its formation or organization with the
applicable Governmental Authority in the jurisdiction of its formation or
organization and, if applicable, any certificate or articles of formation or
organization of such entity.
"Other Taxes" means all present or future stamp, documentary, excise,
property, intangible, mortgage recording or similar taxes, charges or similar
levies arising from any payment made hereunder or under any other Loan Document
or from the execution, delivery or enforcement of, or otherwise with respect
to, this Agreement or any other Loan Document.
"Outstanding Amount" means, without duplication, (a) with respect to
Term Loans, Revolving Credit Loans and Swing Line Loans on any date, the
aggregate outstanding principal amount thereof (calculated in respect of Loans
denominated in a Foreign Currency on the Equivalent thereof in Dollars at such
time) after giving effect to any borrowings and prepayments or repayments of
Term Loans, Revolving Credit Loans and Swing Line Loans, as the case may be,
occurring on such date; and (b) with respect to any L/C Obligations on any
date,
35
the amount of such L/C Obligations on such date after giving effect to any L/C
Credit Extension occurring on such date and any other changes in the aggregate
amount of the L/C Obligations as of such date, including as a result of any
reimbursements by a Borrower of Unreimbursed Amounts.
"Overnight Rate" means with respect to any Euro Swing Line Loan, UK
Swing Line Loan or any unpaid sum denominated in a currency other than Dollars,
the rate of interest per annum determined by the Administrative Agent as the
rate of interest at which deposits in the applicable currency, in the
approximate amount of such Euro Swing Line Loan, such UK Swing Line Loan or
such sum and having a term of one Business Day (or, in the case of a Euro Swing
Line Loan or UK Swing Line Loan, such other period not exceeding ten Business
Days as may be agreed by the Euro Borrower or the UK Borrower, as applicable,
and the Swing Line Lender), would be offered to major banks in the London
interbank market at their request at approximately 1:00 p.m. (London time) (or
such other period of time as the Administrative Agent determines is customary
for deposits in the applicable currency and for the applicable term) on the
term for which such rate is being determined (or, in the case of a Euro Swing
Line Loan or a UK Swing Line Loan, such other rate as may be agreed upon
between the Euro Borrower of the UK Borrower, as applicable, and the Swing Line
Lender).
"Overnight Rate Loan" means a Loan having interest at the Overnight
Rate.
"Participant" has the meaning specified in Section 10.06(d).
"PBGC" means the Pension Benefit Guaranty Corporation.
"Pension Plan" means any "employee pension benefit plan" (as such term
is defined in Section 3(2) of ERISA), other than a Multiemployer Plan, that is
subject to Title IV of ERISA and is sponsored or maintained by the U.S.
Borrower or any ERISA Affiliate or to which the U.S. Borrower or any ERISA
Affiliate contributes or has an obligation to contribute or to which the U.S.
Borrower or any ERISA Affiliate could have liability under Section 4064 or 4069
of ERISA in the event such plan has been or were to be terminated.
"Permitted Acquisition" means an Investment that is consummated in
compliance with the requirements of Section 7.03(h).
"Permitted Encumbrances" has the meaning specified in the Mortgages.
"Permitted Lien" has the meaning specified in Section 7.01.
"Person" means any natural person, corporation, limited liability
company, trust, joint venture, association, company, partnership, Governmental
Authority or other entity.
"Plan" means any "employee benefit plan" (as such term is defined in
Section 3(3) of ERISA) established by the U.S. Borrower or, with respect to any
such plan that is subject to Section 412 of the Code or Title IV of ERISA, any
ERISA Affiliate.
"Platform" has the meaning specified in Section 6.02.
36
"Pledged Debt" has the meaning specified in Section 1(d) of the
Security Agreement.
"Pledged Equity" has the meaning specified in Section 1(d) of the
Security Agreement.
"Pound Sterling" or "(pound)" means lawful money of the United
Kingdom.
"Public Lender" has the meaning specified in Section 6.02.
"Qualified Foreign Credit Facility" means a credit facility provided
by a Lender or an Affiliate of a Lender to any foreign Subsidiary that (a) is
guaranteed by the U.S. Borrower, (b) is permitted under Section 7.02(g) and (d)
and (c) the U.S. Borrower has specified in a written notice to the
Administrative Agent is entitled to the benefit of the ROV Guaranty, the KGaA
Guaranty, the UK Guaranty and the Collateral Documents.
"Qualified Foreign Lender" means any Person that is a Lender or an
Affiliate of a Lender, in its capacity as a party to a Qualified Foreign Credit
Facility.
"Rayovac Europe GmbH Share Pledge" means the Share Pledge Agreement
dated as of the Closing Date among ROV Holding, as pledgor, and the
Administrative Agent and the lenders named therein, as pledgees, with respect
to the Equity Interests of Rayovac Europe GmbH.
"Refinancing" has the meaning specified in the Preliminary Statements
to this Agreement.
"Register" has the meaning specified in Section 10.06(c).
"Registered Public Accounting Firm" has the meaning specified by the
Securities Laws and shall be independent of the U.S. Borrower as described by
the Securities Laws.
"Related Documents" means the Merger Agreement, the Shareholders
Agreement and the Standstill Agreement.
"Related Parties" means, with respect to any Person, such Person's
Affiliates and the partners, directors, officers, employees, agents and
advisors of such Person and of such Person's Affiliates.
"Relevant Local Time" means, with respect to any notice being given or
any payment being made, the local time in the zone in which such notice or
payment is received.
"Relevant Undertakings" has the meaning specified in Section 7.20.
"Renminbi," "Yuan" and "Y" mean lawful money of China.
37
"Reportable Event" means any of the events set forth in Section
4043(c) of ERISA, other than events for which the 30 day notice period has been
waived.
"Request for Credit Extension" means (a) with respect to a Borrowing,
conversion or continuation of Term Loans or Revolving Credit Loans, a Committed
Loan Notice, (b) with respect to an L/C Credit Extension, a Letter of Credit
Application and, (c) with respect to a Swing Line Loan, a Swing Line Loan
Notice.
"Required Canadian Term Lenders" means, as of any date of
determination, Canadian Term Lenders holding more than 50% of the aggregate
principal amount of the Canadian Term Loans outstanding on such date; provided
that the Canadian Term Loans held by any Defaulting Lender shall be excluded
for purposes of making a determination of Required Canadian Term Lenders.
"Required Dollar Letter of Credit Lenders" means, as of any date of
determination, U.S. Revolving Credit Lenders holding more than 50% of the sum
of the (a) Total U.S. Revolving Credit Outstandings (with the aggregate amount,
without duplication, of each U.S. Revolving Credit Lender's risk participation
and funded participation in Dollar L/C Obligations and Dollar Swing Line Loans
being deemed "held" by such U.S. Revolving Credit Lender for purposes of this
definition) and (b) aggregate unused U.S. Revolving Credit Commitments;
provided that the unused U.S. Revolving Credit Commitment of, and the portion
of the Total U.S. Revolving Credit Outstandings held or deemed held by, any
Defaulting Lender shall be excluded for purposes of making a determination of
Required U.S. Letter of Credit Lenders.
"Required Dollar Term Lenders" means, as of any date of determination,
Dollar Term Lenders holding more than 50% of the aggregate principal amount of
the Dollar Term Loans outstanding on such date; provided that the Dollar Term
Loans held by any Defaulting Lender shall be excluded for purposes of making a
determination of Required Dollar Term Lenders.
"Required Euro Letter of Credit Lenders" means, as of any date of
determination, Euro Revolving Credit Lenders holding more than 50% of the sum
of the (a) Total Euro Revolving Credit Outstandings (with the aggregate amount,
without duplication, of each Euro Revolving Credit Lender's risk participation
and funded participation in Euro L/C Obligations and Euro Swing Line Loans
being deemed "held" by such Euro. Revolving Credit Lender for purposes of this
definition) and (b) aggregate unused Euro Revolving Credit Commitments;
provided that the unused Euro Revolving Credit Commitment of, and the portion
of the Total Euro Revolving Credit Outstandings held or deemed held by, any
Defaulting Lender shall be excluded for purposes of making a determination of
Required Euro Letter of Credit Lenders.
"Required Euro Term Lenders" means, as of any date of determination,
at Euro Term Lenders holding more than 50% of the aggregate principal amount of
the Euro Term Loans outstanding on such date; provided that the Euro Term Loans
held by any Defaulting Lender shall be excluded for purposes of making a
determination of Required Euro Term Lenders.
38
"Required Lenders" means, as of any date of determination, Lenders
holding more than 50% of the sum of the (a) Total Outstandings (with the
aggregate amount, without duplication, of each Revolving Credit Lender's risk
participation and funded participation in L/C Obligations and Swing Line Loans
being deemed "held" by such Revolving Credit Lender for purposes of this
definition) and (b) aggregate unused Revolving Credit Commitments; provided
that the unused Revolving Credit Commitment of, and the portion of the Total
Outstandings held or deemed held by, any Defaulting Lender shall be excluded
for purposes of making a determination of Required Lenders.
"Required Revolving Lenders" means, as of any date of determination,
Revolving Credit Lenders holding more than 50% of the sum of the (a) Total U.S.
Revolving Credit Outstandings (with the aggregate amount, without duplication,
of each U.S. Revolving Credit Lender's risk participation and funded
participation in Dollar L/C Obligations and Dollar Swing Line Loans being
deemed "held" by such U.S. Revolving Credit Lender for purposes of this
definition), (b) Total Euro Revolving Credit Outstandings (with the aggregate
amount, without duplication, of each Euro Revolving Credit Lender's risk
participation and funded participation in Euro L/C Obligations Euro Swing Line
Loans being deemed "held" by such Euro Revolving Credit Lender for purposes of
this definition), (c) Total UK Revolving Credit Outstandings (with the
aggregate amount, without duplication, of each UK Revolving Credit Lender's
risk participation and funded participation being deemed "held" by such UK
Revolving Credit Lender for purposes of this definition), (d) aggregate unused
U.S. Revolving Credit Commitments, (e) aggregate unused Euro Revolving Credit
Commitments and (f) aggregate unused UK Revolving Credit Commitments; provided
that the unused Revolving Credit Commitment of, and the portion of the Total
U.S. Revolving Credit Outstandings, Total Euro Revolving Credit Outstandings or
Total UK Revolving Credit Outstandings held or deemed held by, any Defaulting
Lender shall be excluded for purposes of making a determination of Required
Revolving Lenders.
"Required Term Lenders" means, as of any date of determination, Term
Lenders holding more than 50% of the aggregate principal amount of the Term
Loans outstanding on such date; provided that the Term Loans held by any
Defaulting Lender shall be excluded for purposes of making a determination of
Required Term Lenders.
"Required UK Letter of Credit Lenders" means, as of any date of
determination, UK Revolving Credit Lenders holding more than 50% of the sum of
the (a) Total UK Revolving Credit Outstandings (with the aggregate amount,
without duplication, of each UK Revolving Credit Lender's risk participation
and funded participation in UK L/C Obligations and UK Swing Line Loans being
deemed "held" by such UK Revolving Credit Lender for purposes of this
definition) and (b) aggregate unused UK Revolving Credit Commitments; provided
that the unused UK Revolving Credit Commitment of, and the portion of the Total
UK Revolving Credit Outstandings held or deemed held by, any Defaulting Lender
shall be excluded for purposes of making a determination of Required UK Letter
of Credit Lenders.
"Responsible Officer" means the chief executive officer, president,
chief financial officer, treasurer or assistant treasurer of a Loan Party, or
in the case of the U.K. Borrower, a director. Any document delivered hereunder
that is signed by a Responsible Officer of a Loan Party shall be conclusively
presumed to have been authorized by all necessary corporate,
39
partnership and/or other action on the part of such Loan Party and such
Responsible Officer shall be conclusively presumed to have acted on behalf of
such Loan Party.
"Restricted Payment" means any dividend or other distribution with
respect to any capital stock or other Equity Interest of any Person or any of
its Subsidiaries, or any payment, including any sinking fund or similar
deposit, on account of the purchase, redemption, retirement, defeasance,
acquisition, cancellation or termination of any such capital stock or other
Equity Interest, or on account of any return of capital to any Person's
stockholders, partners or members (or the equivalent of any thereof).
"Restructuring Charges" means all cash and noncash charges related to
the integration of an acquisition or non-recurring charges related to a
non-recurring restructuring of operations of the U.S. Borrower and its
Subsidiaries appearing or disclosed in the audited consolidated financial
statements of the U.S. Borrower and its Subsidiaries.
"Revolving Credit Borrowing" means any or all of (as the context may
require) a U.S. Revolving Credit Borrowing, a Euro Revolving Credit Borrowing
or a UK Revolving Credit Borrowing.
"Revolving Credit Commitment" means any or all of (as the context may
require) a U.S. Revolving Credit Commitment, a Euro Revolving Credit Commitment
or a UK Revolving Credit Commitment.
"Revolving Credit Facility" means any or all of (as the context may
require) the U.S. Revolving Credit Facility, the Euro Revolving Credit Facility
or the U.K. Revolving Credit Facility.
"Revolving Credit Lender" means any or all of (as the context may
require) a U.S. Revolving Credit Lender, a Euro Revolving Credit Lender or a UK
Revolving Credit Lender.
"Revolving Credit Loan" means any or all of (as the context may
require) a U.S. Revolving Credit Loan, a Euro Revolving Credit Loan or a UK
Revolving Credit Loan.
"Revolving Credit Note" means any or all of (as the context may
require) a U.S. Revolving Credit Note, a Euro Revolving Credit Note or a UK
Revolving Credit Note.
"Rosata/Paula Acquisitions" means the acquisition of one or more of
the Euro Borrower's leased facilities located in Ellwangen, Germany and
Dischingen, Germany, currently owned by Paula
Grundstucksverwaltungsgesellschaft mbH & Co. Vermietungs-KG, Mannheim and
ROSATA Grundstucksvermietungsgesellschaft mbH & Co. Object Dischingen KG,
Dusseldorf, respectively, or the equity interests of one or both such entities,
for an aggregate purchase price not to exceed (euro)20,000,000.
"ROV German Holding" means Rayovac Europe GmbH, with a registered seat
in Sulzbach, registered under file no. HRB 55482 with the Commercial Register
(Handelsregister) located with the local court (Amtsgericht) Frankfurt am Main,
Germany.
40
"ROV GP GmbH" means ROV German General Partner GmbH, with a registered
seat in Sulzbach, registered under file no. HRB 55425 with the Commercial
Register (Handelsregister) located with the local court (Amtsgericht) Frankfurt
am Main, Germany.
"ROV Guarantors" means, collectively, the Subsidiaries of the U.S.
Borrower listed on Schedule II and each other Subsidiary of the U.S. Borrower
that shall be required to execute and deliver a guaranty or guaranty supplement
pursuant to Section 6.12(a)(i)(A).
"ROV Guaranty" means, collectively, the ROV Guaranty made by the ROV
Guarantors in favor of the Secured Parties, substantially in the form of
Exhibit F-1, together with each other guaranty and guaranty supplement
delivered pursuant to Section 6.12(a)(i)(A).
"ROV Holding" means ROV Holding, Inc., a corporation organized under
the laws of Delaware.
"ROV LP GmbH" means ROV German Limited GmbH, with a registered seat in
Sulzbach, registered under file no. HRB 55352 with the Commercial Register
(Handelsregister) located with the local court (Amtsgericht) Frankfurt am Main,
Germany.
"S&P" means Standard & Poor's Ratings Services, a division of The
McGraw-Hill Companies, Inc. and any successor thereto.
"Sarbanes-Oxley" means the Sarbanes-Oxley Act of 2002.
"SEC" means the Securities and Exchange Commission, or any
Governmental Authority succeeding to any of its principal functions.
"Secured Hedge Agreement" means any interest rate Swap Contract
required or permitted under Article VI or VII that is entered into by and
between any Borrower and any Lender or Affiliate of a Lender.
"Secured Obligations" means all Obligations of the Loan Parties now or
hereafter existing under the Loan Documents.
"Secured Parties" means, collectively, the Administrative Agent, the
Lenders, the L/C Issuer, the Hedge Banks, the Qualified Foreign Lenders, each
co-agent or sub-agent appointed by the Administrative Agent from time to time
pursuant to Section 9.06, and the other Persons the Secured Obligations owing
to which are or are purported to be secured by the Collateral under the terms
of the Collateral Documents.
"Securities Laws" means the Securities Act of 1933, the Securities
Exchange Act of 1934, Sarbanes-Oxley, and, in each case, the rules and
regulations of the SEC promulgated thereunder, and the applicable accounting
and auditing principles, rules, standards and practices promulgated, approved
or incorporated by the SEC or the Public Company Accounting Oversight Board, as
each of the foregoing may be amended and in effect on any applicable date under
this Agreement.
"Security Agreement" has the meaning specified in Section
4.01(a)(iii).
41
"Security Agreement Supplement" has the meaning specified in Section
22 of the Security Agreement.
"Shareholders' Agreement" means the Shareholders' Agreement dated as
of January 3, 2005, by and between the U.S. Borrower and UIC Holdings.
"Solvent" and "Solvency" mean, with respect to any Person on any date
of determination, that on such date (a) the fair value of the property of such
Person is greater than the total amount of liabilities, including contingent
liabilities, of such Person, (b) the present fair salable value of the assets
of such Person is not less than the amount that will be required to pay the
probable liability of such Person on its debts as they become absolute and
matured, (c) such Person does not intend to, and does not believe that it will,
incur debts or liabilities beyond such Person's ability to pay such debts and
liabilities as they mature and (d) such Person is not engaged in business or a
transaction, and is not about to engage in business or a transaction, for which
such Person's property would constitute an unreasonably small capital. The
amount of contingent liabilities at any time shall be computed as the amount
that, in the light of all the facts and circumstances existing at such time,
represents the amount that can reasonably be expected to become an actual or
matured liability.
"SPC" has the meaning specified in Section 10.06(h).
"Standstill Agreement" means the Standstill Agreement to be dated as
of February 7, 2005, by and among UIC Holdings, THLee and the U.S. Borrower.
"Subordinated Notes" means the 2013 Notes and the 2015 Notes.
"Subsidiary" of a Person means a corporation, partnership, joint
venture, limited liability company or other business entity of which a majority
of the shares of securities or other interests having ordinary voting power for
the election of directors or other governing body (other than securities or
interests having such power only by reason of the happening of a contingency)
are at the time beneficially owned, or the management of which is otherwise
controlled, directly, or indirectly through one or more intermediaries, or
both, by such Person (including, for the avoidance of doubt, a company,
corporation or partnership which is a "dependent enterprise" (abhangiges
Unternehmen) of such Person within the meaning of Section 17 of the German
Stock Corporation Act (Aktiengesetz), or which is a "subsidiary"
(Tochterunternehmen) within the meaning of Section 290 of the German Commercial
Code (Handelsgesetzbuch) of such Person, or where such Person has the power to
direct the management and the policies of such entity whether through the
ownership of share capital, contract or otherwise). Unless otherwise specified,
all references herein to a "Subsidiary" or to "Subsidiaries" shall refer to a
Subsidiary or Subsidiaries of U.S. Borrower.
"Subsidiary Borrower" has the meaning specified in the introductory
paragraph hereto.
"Supplemental Collateral Agent" has the meaning specified in Section
9.12(a) and "Supplemental Collateral Agents" shall have the corresponding
meaning.
42
"Swap Contract" means (a) any and all rate swap transactions, basis
swaps, credit derivative transactions, forward rate transactions, commodity
swaps, commodity options, forward commodity contracts, equity or equity index
swaps or options, bond or bond price or bond index swaps or options or forward
bond or forward bond price or forward bond index transactions, interest rate
options, forward foreign exchange transactions, cap transactions, floor
transactions, collar transactions, currency swap transactions, cross-currency
rate swap transactions, currency options, spot contracts, or any other similar
transactions or any combination of any of the foregoing (including any options
to enter into any of the foregoing), whether or not any such transaction is
governed by or subject to any master agreement, and (b) any and all
transactions of any kind, and the related confirmations, which are subject to
the terms and conditions of, or governed by, any form of master agreement
published by the International Swaps and Derivatives Association, Inc., any
International Foreign Exchange Master Agreement, or any other master agreement
(any such master agreement, together with any related schedules, a "Master
Agreement"), including any such obligations or liabilities under any Master
Agreement.
"Swap Termination Value" means, in respect of any one or more Swap
Contracts, after taking into account the effect of any legally enforceable
netting agreement relating to such Swap Contracts, (a) for any date on or after
the date such Swap Contracts have been closed out and termination value(s)
determined in accordance therewith, such termination value(s), and (b) for any
date prior to the date referenced in clause (a), the amount(s) determined as
the mark-to-market value(s) for such Swap Contracts, as determined based upon
one or more mid-market or other readily available quotations provided by any
recognized dealer in such Swap Contracts (which may include a Lender or any
Affiliate of a Lender).
"Swing Line" means any or all of (as the context may require) the
Dollar Swing Line, the Euro Swing Line or the UK Swing Line.
"Swing Line Borrowing" means any or all of (as the context may
require) a Dollar Swing Line Borrowing, a Euro Swing Line Borrowing or a UK
Swing Line Borrowing.
"Swing Line Lender" means Bank of America in its capacity as provider
of Swing Line Loans, or any successor swing line lender hereunder.
"Swing Line Loan" means any or all of (as the context may require) a
Dollar Swing Line Loan, a Euro Swing Line Loan or a UK Swing Line Loan.
"Swing Line Loan Notice" means a notice of a Swing Line Borrowing
pursuant to Section 2.06(d), which, if in writing, shall be substantially in
the form of Exhibit B.
"Syndication Agent" means CNAI in its capacity as syndication agent
hereunder.
"Synthetic Debt" means, with respect to any Person as of any date of
determination thereof, all Obligations of such Person in respect of
transactions entered into by such Person that are intended to function
primarily as a borrowing of funds (including any minority interest transactions
that function primarily as a borrowing) but are not otherwise included in the
definition of "Indebtedness" or as a liability on the consolidated balance
sheet of such Person and its Subsidiaries in accordance with GAAP.
43
"Synthetic Lease Obligation" means the monetary obligation of a Person
under (a) a so-called synthetic, off-balance sheet or tax retention lease, or
(b) an agreement for the use or possession of property (including sale and
leaseback transactions), in each case, creating obligations that do not appear
on the balance sheet of such Person but which, upon the application of any
Debtor Relief Laws to such Person, would be characterized as the indebtedness
of such Person (without regard to accounting treatment).
"TARGET Day" means any day on which the Trans-European Automated
Real-time Gross settlement Express Transfer payment system is open for the
settlement of payments in Euro.
"Taxes" means all present or future taxes, levies, imposts, duties,
deductions, withholdings, assessments, fees or other charges imposed by any
Governmental Authority, including any interest, additions to tax or penalties
applicable thereto.
"Term Borrowing" means either a Canadian Term Borrowing, a Dollar Term
Borrowing or a Euro Term Borrowing.
"Term Commitment" means (as the context requires) a Canadian Term
Commitment, a Dollar Term Commitment or a Euro Term Commitment.
"Term Facilities" means (as the context requires) the Canadian Term
Facility, the Dollar Term Facility and the Euro Term Facility.
"Term Loan" means one or all of (as the context requires) a Canadian
Term Loan, a Dollar Term Loan or a Euro Term Loan.
"Term Note" means one or all of (as the context may require) a
Canadian Term Note, a Dollar Term Note or a Euro Term Note.
"THLee" means Thomas H. Lee Partners, L.P. and its Affiliates.
"Threshold Amount" means $20,000,000.
"Total Assets" means, as of any day, the total consolidated assets of
the U.S. Borrower and its Subsidiaries, as shown on the most recent balance
sheet delivered pursuant to Section 6.01.
"Total Euro Revolving Credit Outstandings" means the aggregate
Outstanding Amount of all Euro Revolving Credit Loans, Euro L/C Obligations and
Euro Swing Line Loans.
"Total Outstandings" means the aggregate Outstanding Amount of all
Loans and all L/C Obligations.
"Total UK Revolving Credit Outstandings" means the aggregate
Outstanding Amount of all UK Revolving Credit Loans, UK L/C Obligations and UK
Swing Line Loans.
44
"Total U.S. Revolving Credit Outstandings" means the aggregate
Outstanding Amount of all U.S. Revolving Credit Loans, Dollar Swing Line Loans
and Dollar L/C Obligations.
"Transaction" means, collectively, (a) the consummation of the Merger,
(b) the entering into by the Loan Parties and their applicable Subsidiaries of
the Loan Documents and the Related Documents to which they are or are intended
to be a party, (c) the Refinancing and (d) the payment of the fees and expenses
incurred in connection with the consummation of the foregoing.
"Treaty Lender" has the meaning specified in the definition of "UK
Lender".
"Type" means, with respect to a Loan denominated in Dollars, its
character as a Base Rate Loan or a Eurodollar Rate Loan.
"UIC" means United Industries Corporation, a Delaware corporation.
"UIC Holdings" means UIC Holdings, L.L.C., a Delaware limited
liability company.
"UIC Notes" means 9.875% senior subordinated notes of UIC existing on
the Closing Date.
"UK Borrower" has the meaning specified in the introductory paragraph
hereto.
"UK Guarantors" means, collectively, the U.S. Borrower, the
Subsidiaries of the U.S. Borrower listed on Schedule III and each other
Subsidiary of the U.S. Borrower that shall be required to execute and deliver a
guaranty or guaranty supplement pursuant to Section 6.12(a)(i)(B).
"UK Guaranty" means, collectively, the UK Guaranty made by the UK
Guarantors in favor of the Administrative Agent, the L/C Issuers and the
Lenders, substantially in the form of Exhibit F-3, together with each other
guaranty and guaranty supplement delivered pursuant to Section 6.12(a)(i)(B).
"UK Honor Date" has the meaning specified in Section 2.05(c)(i).
"UK Lender" means a Lender which is beneficially entitled to interest
payable to that Lender in respect of a loan made under this Agreement to a
Borrower incorporated in the United Kingdom and which Lender is either:
(i) a Lender:
(A) which is a bank (as defined for the purposes of Section 349 of
the UK Income and Corporation Taxes Act 1988) making an advance
under this Agreement; or
45
(B) in respect of an advance made under this Agreement by a person
that was a bank (as defined for the purposes of Section 349 of
the UK Income and Corporation Taxes Act 1988) at the time that
the advance was made,
and in either case is within the charge to UK corporation tax as
respects any payment of interest made in respect of that advance; or
(ii) a Lender which is treated as resident (for the purposes of the
relevant double taxation agreement) in a jurisdiction having a double
taxation agreement with the United Kingdom which makes provision for full
exemption from Tax imposed by the United Kingdom on interest and does not
carry on business in the United Kingdom through a permanent establishment
with which that Lender's participation in that loan is effectively
connected (a "Treaty Lender").
"UK L/C Advance" means, with respect to each UK Revolving Credit
Lender, such Lender's funding of its participation in any UK L/C Borrowing in
accordance with its Applicable Percentage.
"UK L/C Borrowing" means an extension of credit resulting from a
drawing under any UK Letter of Credit which has not been (a) reimbursed within
one Business Day following the date when made or (b) refinanced as a UK
Revolving Credit Borrowing.
"UK L/C Obligations" means, as at any date of determination, the
aggregate amount available to be drawn under all outstanding UK Letters of
Credit plus the aggregate of all Unreimbursed UK Amounts, including all UK L/C
Borrowings. For purposes of computing the amount available to be drawn under
any UK Letter of Credit, the amount of such UK Letter of Credit shall be
determined in accordance with Section 1.06. For all purposes of this Agreement,
if on any date of determination a UK Letter of Credit has expired by its terms
but any amount may still be drawn thereunder by reason of the operation of Rule
3.14 of the ISP, such UK Letter of Credit shall be deemed to be "outstanding"
in the amount so remaining available to be drawn.
"UK Letter of Credit" means any letter of credit issued hereunder that
is denominated in Pounds Sterling. A UK Letter of Credit may be a commercial
letter of credit or a standby letter of credit.
"UK Letter of Credit Expiration Date" means the day that is seven days
prior (or such later date determined in the sole discretion of the L/C Issuer)
to the Maturity Date then in effect for the UK Revolving Credit Facility (or,
if such day is not a Business Day, the next preceding Business Day).
"UK Letter of Credit Fee" has the meaning specified in Section
2.05(i).
"UK Letter of Credit Sublimit" means an amount equal to the UK
Revolving Credit Facility. The UK Letter of Credit Sublimit is part of, and not
in addition to, the UK Revolving Credit Facility.
"UK Reduction Amount" has the meaning specified in Section 2.07(b)(x).
46
"UK Revolving Credit Borrowing" means a borrowing consisting of
simultaneous UK Revolving Credit Loans to the UK Borrower having the same
Interest Period made by each of the UK Revolving Credit Lenders pursuant to
Section 2.01(f).
"UK Revolving Credit Commitment" means, as to each UK Revolving Credit
Lender, its obligation to (a) make UK Revolving Credit Loans to the UK Borrower
pursuant to Section 2.01(f), (b) purchase participations in UK L/C Obligations,
and (c) purchase participations in UK Swing Line Loans, in an aggregate
principal amount at any one time outstanding not to exceed the amount set forth
opposite such Lender's name on Schedule 2.01 under the caption "UK Revolving
Credit Commitment" or opposite such caption in the Assignment and Assumption
pursuant to which such Lender becomes a party hereto, as applicable, as such
amount may be adjusted from time to time in accordance with this Agreement.
"UK Revolving Credit Facility" means, at any time, the aggregate
amount of the UK Revolving Credit Lenders' UK Revolving Credit Commitments at
such time.
"UK Revolving Credit Lender" means, at any time, any Lender that has a
UK Revolving Credit Commitment at such time.
"UK Revolving Credit Loan" has the meaning specified in Section
2.01(f).
"UK Revolving Credit Note" means a promissory note made by the UK
Borrower in favor of a UK Revolving Credit Lender evidencing UK Revolving
Credit Loans or UK Swing Line Loans, as the case may be, made by such UK
Revolving Credit Lender, in substantially the form of Exhibit C-4.
"UK Swing Line" means the UK revolving credit facility made available
by the Swing Line Lender pursuant to Section 2.06.
"UK Swing Line Borrowing" means a borrowing of a UK Swing Line Loans
pursuant to Section 2.06.
"UK Swing Line Loan" has the meaning specified in Section 2.06(c).
"UK Swing Line Sublimit" means at any time an amount equal to the
lesser of (a) (pound)5,000,000 and (b) the UK Revolving Credit Facility at such
time. The UK Swing Line Sublimit is part of, and not in addition to, the UK
Revolving Credit Facility Commitments.
"Unfunded Pension Liability" means the excess of a Pension Plan's
benefit liabilities under Section 4001(a)(16) of ERISA over the current value
of that Pension Plan's assets, determined in accordance with the assumptions
used for funding the Pension Plan pursuant to Section 412 of the Code for the
applicable plan year.
"United States" and "U.S." mean the United States of America.
"Unreimbursed Dollar Amount" has the meaning specified in Section
2.03(c)(i).
47
"Unreimbursed Euro Amount" has the meaning specified in Section
2.04(c)(i).
"Unreimbursed UK Amount" has the meaning specified in Section
2.05(c)(i).
"UPG Acquisition" means the acquisition by UIC of all the outstanding
equity interests of United Pet Group, Inc., a Delaware corporation, pursuant to
a Merger Agreement dated as of June 14, 2004.
"U.S. Borrower" has the meaning specified in the introductory
paragraph hereto.
"U.S. Reduction Amount" has the meaning set forth in Section
2.07(b)(viii).
"U.S. Revolving Credit Borrowing" means a borrowing consisting of
simultaneous U.S. Revolving Credit Loans of the same Type and, in the case of
Eurocurrency Rate Loans, having the same Interest Period made by each of the
U.S. Revolving Credit Lenders pursuant to Section 2.01(d).
"U.S. Revolving Credit Commitment" means, as to each U.S. Revolving
Credit Lender, its obligation to (a) make U.S. Revolving Credit Loans to the
U.S. Borrower pursuant to Section 2.01(d), (b) purchase participations in
Dollar L/C Obligations and (c) purchase participations in Dollar Swing Line
Loans in an aggregate principal amount, without duplication, at any one time
outstanding not to exceed the amount set forth opposite such Lender's name on
Schedule 2.01 under the caption "U.S. Revolving Credit Commitment" or opposite
such caption in the Assignment and Assumption pursuant to which such Lender
becomes a party hereto, as applicable, as such amount may be adjusted from time
to time in accordance with this Agreement.
"U.S. Revolving Credit Facility" means, at any time, the aggregate
amount of the U.S. Revolving Credit Lenders' U.S. Revolving Credit Commitments
at such time; provided that if a Chinese Facility contemplated by clause (iii)
of the definition thereof or an Additional Foreign Credit Facility is entered
into, the aggregate U.S. Revolving Credit Commitments shall be reduced by the
amount of such facility and the U. S. Revolving Credit Commitment of any Lender
that commits to such a Chinese Facility shall be reduced by the amount such
Lender so commits.
"U.S. Revolving Credit Lender" means, at any time, any Lender that has
a U.S. Revolving Credit Commitment at such time.
"U.S. Revolving Credit Loan" has the meaning specified in Section
2.01(d).
"U.S. Revolving Credit Note" means a promissory note made by the U.S.
Borrower in favor of a U.S. Revolving Credit Lender evidencing U.S. Revolving
Credit Loans made by such U.S. Revolving Credit Lender, in substantially the
form of Exhibit C-2.
"VARTA Acquisition" means the acquisition by the U.S. Borrower of
certain assets of the Euro Borrower (excluding the Euro Borrower's ownership
interest in Microlite and certain other assets transferred to the Euro
Borrower's parent or Affiliates).
48
"VARTA Acquisition Agreement" means the Agreement dated July 28, 2002
among VARTA AG, ROV German Limited GmbH and the U.S. Borrower delivered in
connection with the VARTA Acquisition.
"VARTA Exchange" means the transfer of the stock of German Finance Co.
to VARTA AG of an affiliate thereof in exchange for the stock of the Euro
Borrower owned by VARTA AG or an affiliate thereof and not more than
(euro)1,000,000, all on the terms set forth in Article XI of the VARTA
Acquisition Agreement as in effect on the date hereof.
"Wholly-Owned Subsidiary" means (i) the Euro Borrower, (ii) any Person
in which (other than director's qualifying shares or similar shares owned by
other Persons due to native ownership requirements) 100% of the capital stock
or other equity interests of each class is owned beneficially and of record by
the U.S. Borrower or by one or more Wholly-Owned Subsidiaries, and (iii) any
80% Subsidiary.
1.02 Other Interpretive Provisions. With reference to this Agreement
and each other Loan Document, unless otherwise specified herein or in such
other Loan Document:
(a) The definitions of terms herein shall apply equally to the
singular and plural forms of the terms defined. Whenever the context may
require, any pronoun shall include the corresponding masculine, feminine and
neuter forms. The words "include," "includes" and "including" shall be deemed
to be followed by the phrase "without limitation." The word "will" shall be
construed to have the same meaning and effect as the word "shall." Unless the
context requires otherwise, (i) any definition of or reference to any
agreement, instrument or other document (including any Organization Document)
shall be construed as referring to such agreement, instrument or other document
as from time to time amended, supplemented or otherwise modified (subject to
any restrictions on such amendments, supplements or modifications set forth
herein or in any other Loan Document), (ii) any reference herein to any Person
shall be construed to include such Person's successors and assigns, (iii) the
words "herein," "hereof" and "hereunder," and words of similar import when used
in any Loan Document, shall be construed to refer to such Loan Document in its
entirety and not to any particular provision thereof, (iv) all references in a
Loan Document to Articles, Sections, Exhibits and Schedules shall be construed
to refer to Articles and Sections of, and Exhibits and Schedules to, the Loan
Document in which such references appear, (v) any reference to any law shall
include all statutory and regulatory provisions consolidating, amending
replacing or interpreting such law and any reference to any law or regulation
shall, unless otherwise specified, refer to such law or regulation as amended,
modified or supplemented from time to time, and (vi) the words "asset" and
"property" shall be construed to have the same meaning and effect and to refer
to any and all tangible and intangible assets and properties, including cash,
securities, accounts and contract rights.
(b) In the computation of periods of time from a specified date to a
later specified date, the word "from" means "from and including;" the words
"to" and "until" each mean "to but excluding;" and the word "through" means "to
and including."
49
(c) Section headings herein and in the other Loan Documents are
included for convenience of reference only and shall not affect the
interpretation of this Agreement or any other Loan Document.
1.03 Accounting Terms. (a) Generally. All accounting terms not
specifically or completely defined herein shall be construed in conformity
with, and all financial data (including financial ratios and other financial
calculations) required to be submitted pursuant to this Agreement shall be
prepared in conformity with, GAAP applied on a consistent basis, as in effect
from time to time, applied in a manner consistent with that used in preparing
the Audited Financial Statements, except as otherwise specifically prescribed
herein.
(b) Changes in GAAP. If at any time any change in GAAP would affect
the computation of any financial ratio or requirement set forth in any Loan
Document, and either the U.S. Borrower or the Required Lenders shall so
request, the Administrative Agent, the Lenders and the U.S. Borrower shall
negotiate in good faith to amend such ratio or requirement to preserve the
original intent thereof in light of such change in GAAP (subject to the
approval of the Required Lenders); provided that, until so amended, (i) such
ratio or requirement shall continue to be computed in accordance with GAAP
prior to such change therein and (ii) the U.S. Borrower shall provide to the
Administrative Agent and the Lenders financial statements and other documents
required under this Agreement or as reasonably requested hereunder setting
forth a reconciliation between calculations of such ratio or requirement made
before and after giving effect to such change in GAAP.
1.04 Rounding. Any financial ratios required to be maintained by the
Borrowers pursuant to this Agreement shall be calculated by dividing the
appropriate component by the other component, carrying the result to one place
more than the number of places by which such ratio is expressed herein and
rounding the result up or down to the nearest number (with a rounding-up if
there is no nearest number).
1.05 Times of Day. Unless otherwise specified, all references herein
to times of day shall be references to Eastern time (daylight or standard, as
applicable).
1.06 Letter of Credit Amounts. Unless otherwise specified, all
references herein to the amount of a Letter of Credit at any time shall be
deemed to be the stated amount of such Letter of Credit in effect at such time;
provided, however, that with respect to any Letter of Credit that, by its terms
or the terms of any Issuer Document related thereto, provides for one or more
automatic increases in the stated amount thereof, the amount of such Letter of
Credit shall be deemed to be the maximum stated amount of such Letter of Credit
after giving effect to all such increases, whether or not such maximum stated
amount is in effect at such time.
1.07 Currency Equivalents Generally. Unless otherwise set forth
herein, any amount specified in this Agreement in Dollars shall include the
Equivalent in Dollars of such amount in any Foreign Currency and if any amount
described in this Agreement is comprised of amounts in Dollars and amounts in
one or more Foreign Currencies, the Equivalent in Dollars of such Foreign
Currency amounts shall be used to determine the total.
50
ARTICLE II
THE COMMITMENTS AND CREDIT EXTENSIONS
2.01 The Loans. (a) The Canadian Term Borrowings. Subject to the terms
and conditions set forth herein, each Canadian Term Lender severally agrees to
make a single loan to the U.S. Borrower on the Closing Date in an amount not to
exceed such Canadian Term Lender's Canadian Term Commitment. The Canadian Term
Borrowing shall consist of Canadian Term Loans made in Canadian Dollars
simultaneously by the Canadian Term Lenders in accordance with their respective
Canadian Term Commitments. Amounts borrowed under this Section 2.01(a) and
repaid or prepaid may not be reborrowed. Canadian Term Loans shall be
Eurocurrency Rate Loans.
(b) The Dollar Term Borrowings. Subject to the terms and conditions
set forth herein, each Dollar Term Lender severally agrees to make a single
loan to the U.S. Borrower on the Closing Date in an amount not to exceed such
Dollar Term Lender's Dollar Term Commitment. The Dollar Term Borrowing shall
consist of Dollar Term Loans made in Dollars simultaneously by the Dollar Term
Lenders in accordance with their respective Dollar Term Commitments. Amounts
borrowed under this Section 2.01(b) and repaid or prepaid may not be
reborrowed. Dollar Term Loans may be Base Rate Loans or Eurocurrency Rate Loans
as further provided herein.
(c) The Euro Term Borrowings. Subject to the terms and conditions set
forth herein, each Euro Term Lender severally agrees to make a single loan to
the U.S. Borrower on the Closing Date in an amount not to exceed such Euro Term
Lender's Euro Term Commitment. The Euro Term Borrowing shall consist of Euro
Term Loans made in Euros simultaneously by the Euro Term Lenders in accordance
with their respective Euro Term Commitments. Amounts borrowed under this
Section 2.01(c) and repaid or prepaid may not be reborrowed. Euro Term Loans
shall be Eurocurrency Rate Loans.
(d) The U.S. Revolving Credit Borrowings. Subject to the terms and
conditions set forth herein, each U.S. Revolving Credit Lender severally agrees
to make loans denominated in Dollars to the U.S. Borrower (each such loan, a
"U.S. Revolving Credit Loan") to the U.S. Borrower from time to time, on any
Business Day during the Availability Period, in an aggregate amount not to
exceed at any time outstanding the amount of such Lender's U.S. Revolving
Credit Commitment; provided, however, that after giving effect to any U.S.
Revolving Credit Borrowing and the use of the proceeds thereof, (i) the Total
U.S. Revolving Credit Outstandings at such time shall not exceed the U.S.
Revolving Credit Facility at such time and (ii) the aggregate Outstanding
Amount of the U.S. Revolving Credit Loans of any Lender, plus such U.S.
Revolving Credit Lender's Applicable U.S. Revolving Credit Percentage of the
Outstanding Amount of all Dollar L/C Obligations, plus such U.S. Revolving
Credit Lender's Applicable U.S. Revolving Credit Percentage of the Outstanding
Amount of all Dollar Swing Line Loans determined on the date of delivery of the
applicable Committed Loan Notice shall not exceed such U.S. Revolving Credit
Lender's U.S. Revolving Credit Commitment. Within the limits of each U.S.
Revolving Credit Lender's U.S. Revolving Credit Commitment, and subject to the
other terms and conditions hereof, the U.S. Borrower may borrow under this
Section 2.01(d), prepay under Section 2.07, and reborrow under this Section
2.01(d). U.S.
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Revolving Credit Loans denominated in Dollars may be Base Rate Loans or
Eurodollar Rate Loans, as further provided herein.
(e) The Euro Revolving Credit Borrowings. Subject to the terms and
conditions set forth herein, each Euro Revolving Credit Lender severally agrees
to make loans denominated in Euros (each such loan, a "Euro Revolving Credit
Loan") to the Euro Borrower, from time to time, on any Business Day during the
Availability Period, in an aggregate amount not to exceed at any time
outstanding the amount of such Euro Revolving Credit Lender's Euro Revolving
Credit Commitment; provided, however, that after giving effect to any Euro
Revolving Credit Borrowing and the use of the proceeds thereof, (i) the Total
Euro Revolving Credit Outstandings at such time shall not exceed the Euro
Revolving Credit Facility at such time and (ii) the aggregate Outstanding
Amount of the Euro Revolving Credit Loans of any Lender, plus such Euro
Revolving Credit Lender's Applicable Euro Revolving Credit Percentage of the
Outstanding Amount of all Euro L/C Obligations, plus such Euro Revolving Credit
Lender's Applicable Euro Revolving Credit Percentage of the Outstanding Amount
of all Euro Swing Line Loans shall not exceed such Euro Revolving Credit
Lender's Euro Revolving Credit Commitment. Within the limits of each Euro
Revolving Credit Lender's Euro Revolving Credit Commitment, and subject to the
other terms and conditions hereof, the Euro Borrower may borrow under this
Section 2.01(e), prepay under Section 2.07, and reborrow under this Section
2.01(e). Euro Revolving Credit Loans shall be Eurocurrency Rate Loans.
(f) The UK Revolving Credit Borrowings. Subject to the terms and
conditions set forth herein, each UK Revolving Credit Lender severally agrees
to make loans denominated in Pounds Sterling (each such loan, a "UK Revolving
Credit Loan") to the UK Borrower, from time to time, on any Business Day during
the Availability Period, in an aggregate amount not to exceed at any time
outstanding the amount of such UK Revolving Credit Lender's UK Revolving Credit
Commitment; provided, however, that after giving effect to any UK Revolving
Credit Borrowing and the use of the proceeds thereof, (i) the Total UK
Revolving Credit Outstandings at such time shall not exceed the UK Revolving
Credit Facility at such time and (ii) the aggregate Outstanding Amount of the
UK Revolving Credit Loans of any Lender, plus such UK Revolving Credit Lender's
Applicable UK Revolving Credit Percentage of the Outstanding Amount of all UK
L/C Obligations plus such UK Revolving Credit Lender's Applicable UK Revolving
Credit Percentage of the Outstanding Amount of all UK Swing Line Loans shall
not exceed such UK Revolving Credit Lender's UK Revolving Credit Commitment.
Within the limits of each UK Revolving Credit Lender's UK Revolving Credit
Commitment, and subject to the other terms and conditions hereof, the UK
Borrower may borrow under this Section 2.01(f), prepay under Section 2.07, and
reborrow under this Section 2.01(f). UK Revolving Credit Loans shall be
Eurocurrency Rate Loans.
2.02 Borrowings, Conversions and Continuations of Loans.
(a) Each Canadian Term Borrowing, each Dollar Term Borrowing, each
Euro Term Borrowing, each U.S. Revolving Credit Borrowing, each Euro Revolving
Credit Borrowing, each UK Revolving Credit Borrowing, each conversion of Dollar
denominated Term Loans or U.S. Revolving Credit Loans from one Type to the
other, and each continuation of Eurocurrency Rate Loans shall be made upon the
applicable Borrower's irrevocable notice to the Administrative Agent, which may
be given by telephone. Each such notice must be received by
52
the Administrative Agent not later than (i) 1:00 p.m. three Business Days prior
to the requested date of any Borrowing of, conversion to or continuation of
Eurodollar Rate Loans or of any conversion of Base Rate Loans to Eurodollar
Rate Loans (ii) 1:00 p.m. (Relevant Local Time) three Business Days prior to
the requested date of any Borrowing or continuation of Eurocurrency Rate Loans
in any Foreign Currency, and (iii) on the requested date of any Borrowing of
Base Rate Loans; provided, however, that if a Borrower wishes to request
Eurocurrency Rate Loans having an Interest Period of nine or twelve months
duration as provided in the definition of "Interest Period", the applicable
notice must be received by the Administrative Agent not later than 1:00 p.m.
(Relevant Local Time) four Business Days prior to the requested date of such
Borrowing, conversion or continuation, whereupon the Administrative Agent shall
give prompt notice to the Lenders of such request and determine whether the
requested Interest Period is acceptable to all of them. Not later than 11:00
a.m. (Relevant Local Time), three Business Days before the requested date of
such Borrowing, conversion or continuation, the Administrative Agent shall
notify such Borrower (which notice may be by telephone) whether or not the
requested Interest Period has been consented to by all the Lenders. Each
telephonic notice by a Borrower pursuant to this Section 2.02(a) must be
confirmed promptly by delivery to the Administrative Agent of a written
Committed Loan Notice, appropriately completed and signed by a Responsible
Officer of such Borrower. Each Borrowing of, conversion to or continuation of
Eurodollar Rate Loans shall be in a principal amount of $5,000,000 or a whole
multiple of $1,000,000 in excess thereof and each Borrowing or continuation of
Eurocurrency Rate Loans in Foreign Currencies shall be in a principal amount of
(euro)5,000,000 or a whole multiple of (euro)1,000,000 in excess thereof in the
case of Loans denominated in Euros, in a principal amount of (pound)5,000,000
or a whole multiple of (pound)1,000,000 in excess thereof in the case of Loans
denominated in Pounds Sterling and in a principal amount of CAD5,000,000 or a
whole multiple of CAD1,000,000 in excess thereof in the case of Loans
denominated in Canadian Dollars. Except as provided in Sections 2.03(c) and
2.06(e), each Borrowing of or conversion to Base Rate Loans shall be in a
principal amount of $500,000 or a whole multiple of $100,000 in excess thereof.
Each telephonic request and each Committed Loan Notice shall specify (i)
whether the applicable Borrower is requesting a Canadian Term Borrowing, a
Dollar Term Borrowing, a Euro Term Borrowing, a U.S. Revolving Credit
Borrowing, a UK Revolving Credit Borrowing, a Euro Revolving Credit Borrowing,
a conversion of Dollar denominated Term Loans or Revolving Credit Loans from
one Type to the other, or a continuation of Eurocurrency Rate Loans, (ii) the
requested date of the Borrowing, conversion or continuation, as the case may be
(which shall be a Business Day), (iii) the principal amount of Loans to be
borrowed, converted or continued (expressed in the applicable currency), (iv)
in the case of Loans denominated in Dollars, the Type of Loans to be borrowed
or to which existing Term Loans or Revolving Credit Loans are to be converted,
and (v) in the case of a Eurocurrency Rate Loan, the currency and the duration
of the Interest Period with respect thereto. If a Borrower fails to specify a
Type of Loan in a Committed Loan Notice or if a Borrower fails to give a timely
notice requesting a conversion or continuation, then the applicable Term Loans
or applicable Revolving Credit Loans shall be made as, or converted to, Base
Rate Loans, except in the case of Loans denominated in Foreign Currencies,
which shall always be Eurocurrency Rate Loans and upon such failure the
applicable Borrower shall be deemed to have specified an Interest Period for
Eurocurrency Rate Loans of one month. Any such automatic conversion to Base
Rate Loans or deemed Interest Period shall be effective as of the last day of
the Interest Period then in effect with respect to the applicable Eurocurrency
Rate
53
Loans. If a Borrower requests a Borrowing of, conversion to, or continuation of
Eurocurrency Rate Loans in any such Committed Loan Notice, but fails to specify
an Interest Period, it will be deemed to have specified an Interest Period of
one month. Notwithstanding anything to the contrary herein, a Dollar Swing Line
Loan shall only be a Base Rate Loan and may not be converted to a Eurocurrency
Rate Loan.
(b) Following receipt of a Committed Loan Notice, the Administrative
Agent shall promptly notify each Lender of the amount of its Applicable
Percentage under the applicable Facility of the applicable Canadian Term Loans,
Dollar Term Loans, Euro Term Loans, U.S. Revolving Credit Loans, Euro Revolving
Credit Loans or UK Revolving Credit Loans, and if no timely notice of a
conversion or continuation is provided by the applicable Borrower, the
Administrative Agent shall notify each Lender of the details of any automatic
conversion to Base Rate Loans or automatic specification of a one month
Interest Period, as applicable, described in Section 2.02(a). In the case of a
Canadian Term Borrowing, a Dollar Term Borrowing, a Euro Term Borrowing, a U.S.
Revolving Credit Borrowing, a Euro Revolving Credit Borrowing or a UK Revolving
Credit Borrowing, each Appropriate Lender shall make the amount of its Loan
available to the Administrative Agent in immediately available funds at the
Administrative Agent's Office not later than 1:00 p.m. (Relevant Local Time) on
the Business Day specified in the applicable Committed Loan Notice. Upon
satisfaction of the applicable conditions set forth in Section 4.02 (and, if
such Borrowing is the initial Credit Extension, Section 4.01), the
Administrative Agent shall make all funds so received available to the
applicable Borrower in like funds as received by the Administrative Agent
either by (i) crediting the account of such Borrower on the books of Bank of
America with the amount of such funds or (ii) wire transfer of such funds, in
each case in accordance with instructions provided to (and reasonably
acceptable to) the Administrative Agent by such Borrower; provided, however,
that (1) if, on the date a Committed Loan Notice with respect to a U.S.
Revolving Credit Borrowing is given by the U.S. Borrower, there are Dollar L/C
Borrowings outstanding, then the proceeds of such U.S. Revolving Credit
Borrowing first shall be applied to the payment in full of any such Dollar L/C
Borrowings and second, shall be made available to the U.S. Borrower as provided
above, (2) if, on the date a Committed Loan Notice with respect to a Euro
Revolving Credit Borrowing is given by the Euro Borrower, there are Euro L/C
Borrowings outstanding, then the proceeds of such Euro Revolving Credit
Borrowing first shall be applied to the payment in full of any such Euro L/C
Borrowing and second, shall be made available to the Euro Borrower as provided
above and (3) if, on the date a Committed Loan Notice with respect to a UK
Revolving Credit Borrowing is given by the UK Borrower, there are UK L/C
Borrowings outstanding, then the proceeds of such UK Revolving Credit Borrowing
first shall be applied to the payment in full of any such UK L/C Borrowing and
second, shall be made available to the UK Borrower as provided above.
(c) Except as otherwise provided herein, a Eurocurrency Rate Loan may
be continued or converted only on the last day of an Interest Period for such
Eurocurrency Rate Loan. During the existence of an Event of Default, no Loans
in Dollars may be requested as, converted to or continued as Eurodollar Rate
Loans and no Loans in any Foreign Currency may be requested as or continued as
Eurocurrency Rate Loans with an Interest Period of greater than one month, in
each case, without the consent of the Required Lenders.
54
(d) The Administrative Agent shall promptly notify the applicable
Borrower and the Lenders of the interest rate applicable to any Interest Period
for Eurocurrency Rate Loans upon determination of such interest rate. At any
time that Base Rate Loans are outstanding, the Administrative Agent shall
notify the U.S. Borrower and the Lenders of any change in Bank of America's
prime rate used in determining the Base Rate promptly following the public
announcement of such change.
(e) After giving effect to all Canadian Term Borrowings and all
continuations of Canadian Term Loans, there shall be no more than 3 Interest
Periods in effect in respect of the Canadian Term Facility. After giving effect
to all Dollar Term Borrowings, all conversions of Dollar Term Loans from one
Type to the other, and all continuations of Dollar Term Loans as the same Type,
there shall be no more than 10 Interest Periods in effect in respect of the
Dollar Term Facility. After giving effect to all Euro Term Borrowings and all
continuations of Euro Term Loans, there shall be no more than 5 Interest
Periods in effect in respect of the Euro Term Facility. After giving effect to
all U.S. Revolving Credit Borrowings, all conversions of U.S. Revolving Credit
Loans from one Type to the other, and all continuations of U.S. Revolving
Credit Loans, there shall be no more than 5 Interest Periods in effect in
respect of the U.S. Revolving Credit Facility. After giving effect to all Euro
Revolving Credit Borrowings and all continuations of Euro Revolving Credit
Loans, there shall be no more than 5 Interest Periods in effect in respect of
the Euro Revolving Credit Facility. After giving effect to all UK Revolving
Credit Borrowings and all continuances of UK Revolving Credit Loans, there
shall be no more than 5 Interest Periods in effect in respect of the UK
Revolving Credit Facility.
(f) Anything in this Section 2.02 notwithstanding, for the initial
Credit Extension, the Borrowers may select Interest Periods of 64 days for up
to U.S. $70 million of Dollar Term Loans and 98 days for up to U.S. $100
million of Dollar Term Loans.
2.03 Dollar Letters of Credit.
(a) The Dollar Letter of Credit Commitment.
(i) Subject to the terms and conditions set forth herein, (A) the L/C
Issuer agrees, in reliance upon the agreements of the other U.S. Revolving
Credit Lenders set forth in this Section 2.03, (1) from time to time on
any Business Day during the period from the Closing Date until the Dollar
Letter of Credit Expiration Date, to issue Dollar Letters of Credit for
the account of the U.S. Borrower (or jointly for the account of the U.S.
Borrower and any Subsidiary), and to amend or extend Dollar Letters of
Credit previously issued by it, in accordance with Section 2.03(b), and
(2) to honor drawings under the Dollar Letters of Credit; and (B) the U.S.
Revolving Credit Lenders severally agree to participate in Dollar Letters
of Credit issued for the account of the U.S. Borrower (or jointly for the
account of the U.S. Borrower and any Subsidiary) and any drawings
thereunder; provided that after giving effect to any L/C Credit Extension
with respect to any Dollar Letter of Credit, (x) the Total U.S. Revolving
Credit Outstandings at such time shall not exceed the U.S. Revolving
Credit Facility at such time, (y) the aggregate Outstanding Amount of the
U.S. Revolving Credit Loans of any U.S. Revolving Credit Lender, plus such
Lender's
55
Applicable U.S. Revolving Credit Percentage of the Outstanding Amount
of all Dollar L/C Obligations, plus such Lender's Applicable U.S.
Revolving Credit Percentage of the Outstanding Amount of all Dollar Swing
Line Loans, shall not exceed such Lender's U.S. Revolving Credit
Commitment, and (z) the Outstanding Amount of the Dollar L/C Obligations
at such time shall not exceed the Dollar Letter of Credit Sublimit. Each
request by the U.S. Borrower for the issuance or amendment of a Dollar
Letter of Credit shall be deemed to be a representation by the U.S.
Borrower that the Dollar L/C Credit Extension so requested complies with
the conditions set forth in the proviso to the preceding sentence. Within
the foregoing limits, and subject to the terms and conditions hereof, the
U.S. Borrower's ability to obtain Dollar Letters of Credit shall be fully
revolving, and accordingly the U.S. Borrower may, during the foregoing
period, obtain Dollar Letters of Credit to replace Dollar Letters of
Credit that have expired or that have been drawn upon and reimbursed. All
Existing Dollar Letters of Credit shall be deemed to have been Dollar
Letters of Credit issued pursuant hereto, and from and after the Closing
Date shall be subject to and governed by the terms and conditions hereof.
(ii) The L/C Issuer shall not issue any Dollar Letter of Credit if
subject to Section 2.03(b)(iii), the expiry date of such requested Dollar
Letter of Credit would occur more than twelve months after the date of
issuance or last extension, unless the Required Dollar Letter of Credit
Lenders have approved such expiry date.
(iii) The L/C Issuer shall not be under any obligation to issue any
Dollar Letter of Credit if:
(A) any order, judgment or decree of any Governmental Authority
or arbitrator shall by its terms purport to enjoin or restrain the L/C
Issuer from issuing such Dollar Letter of Credit, or any Law
applicable to the L/C Issuer or any request or directive (whether or
not having the force of law) from any Governmental Authority with
jurisdiction over the L/C Issuer shall prohibit, or request that the
L/C Issuer refrain from, the issuance of letters of credit generally
or such Dollar Letter of Credit in particular or shall impose upon the
L/C Issuer with respect to such Dollar Letter of Credit any
restriction, reserve or capital requirement (for which the L/C Issuer
is not otherwise compensated hereunder) not in effect on the Closing
Date, or shall impose upon the L/C Issuer any unreimbursed loss, cost
or expense which was not applicable on the Closing Date and which the
L/C Issuer in good faith deems material to it;
(B) the issuance of such Dollar Letter of Credit would violate
one or more policies of the L/C Issuer;
(C) except as otherwise agreed by the Administrative Agent and
the L/C Issuer, such Dollar Letter of Credit is in an initial stated
amount less than $100,000;
(D) the expiry date of such requested Dollar Letter of Credit
would occur after the Dollar Letter of Credit Expiration Date, unless
all of the U.S. Revolving Credit Lenders have approved such expiry
date.
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(E) such Dollar Letter of Credit is to be denominated in a
currency other than Dollars;
(F) such Dollar Letter of Credit contains any provisions for
automatic reinstatement of the stated amount after any drawing
thereunder; or
(G) a default of any Lender's obligations to fund under Section
2.03(c) exists or any Lender is at such time a Defaulting Lender
hereunder, unless the L/C Issuer has entered into satisfactory
arrangements with the U.S. Borrower or such Lender to eliminate the
L/C Issuer's risk with respect to such Lender.
(iv) The L/C Issuer shall not amend any Dollar Letter of Credit if the
L/C Issuer would not be permitted at such time to issue such Dollar Letter
of Credit in its amended form under the terms hereof.
(v) The L/C Issuer shall be under no obligation to amend any Dollar
Letter of Credit if (A) the L/C Issuer would have no obligation at such
time to issue such Dollar Letter of Credit in its amended form under the
terms hereof, or (B) the beneficiary of such Dollar Letter of Credit does
not accept the proposed amendment to such Dollar Letter of Credit.
(vi) The L/C Issuer shall act on behalf of the U.S. Revolving Credit
Lenders with respect to any Dollar Letters of Credit issued by it and the
documents associated therewith, and the L/C Issuer shall have all of the
benefits and immunities (A) provided to the Administrative Agent in
Article IX with respect to any acts taken or omissions suffered by the L/C
Issuer in connection with Dollar Letters of Credit issued by it or
proposed to be issued by it and Issuer Documents pertaining to such Dollar
Letters of Credit as fully as if the term "Administrative Agent" as used
in Article IX included the L/C Issuer with respect to such acts or
omissions, and (B) as additionally provided herein with respect to the L/C
Issuer.
(b) Procedures for Issuance and Amendment of Dollar Letters of
Credit; Auto-Extension Dollar Letters of Credit.
(i) Each Dollar Letter of Credit shall be issued or amended, as the
case may be, upon the request of the U.S. Borrower delivered to the L/C
Issuer (with a copy to the Administrative Agent) in the form of a Letter
of Credit Application, appropriately completed and signed by a Responsible
Officer of the U.S. Borrower. Such Letter of Credit Application must be
received by the L/C Issuer and the Administrative Agent not later than
1:00 p.m. (Relevant Local Time) at least two Business Days (or such later
date and time as the Administrative Agent and the L/C Issuer may agree in
a particular instance in their sole discretion) prior to the proposed
issuance date or date of amendment, as the case may be. In the case of a
request for an initial issuance of a Dollar Letter of Credit, such Letter
of Credit Application shall specify in form and detail reasonably
satisfactory to the L/C Issuer: (A) the proposed issuance date of the
requested Dollar Letter of Credit (which shall be a Business Day); (B) the
amount thereof; (C) the expiry date thereof; (D) the name and address of
the beneficiary thereof; (E) the
57
documents to be presented by such beneficiary in case of any drawing
thereunder; and (F) the full text of any certificate to be presented by
such beneficiary in case of any drawing thereunder. In the case of a
request for an amendment of any outstanding Dollar Letter of Credit, such
Letter of Credit Application shall specify in form and detail reasonably
satisfactory to the L/C Issuer (1) the Dollar Letter of Credit to be
amended; (2) the proposed date of amendment thereof (which shall be a
Business Day); and (3) the nature of the proposed amendment. Additionally,
the U.S. Borrower shall furnish to the L/C Issuer and the Administrative
Agent such other documents and information pertaining to such requested
Dollar Letter of Credit issuance or amendment, including any Issuer
Documents, as the L/C Issuer or the Administrative Agent may reasonably
require.
(ii) Promptly after receipt of any Letter of Credit Application, the
L/C Issuer will confirm with the Administrative Agent (by telephone or in
writing) that the Administrative Agent has received a copy of such Letter
of Credit Application with respect to a Dollar Letter of Credit from the
U.S. Borrower and, if not, the L/C Issuer will provide the Administrative
Agent with a copy thereof. Unless the L/C Issuer has received written
notice from any U.S. Revolving Credit Lender, the Administrative Agent or
any Loan Party, at least one Business Day prior to the requested date of
issuance or amendment of the applicable Dollar Letter of Credit, that one
or more applicable conditions contained in Section 4.02 shall not then be
satisfied, then, subject to the terms and conditions hereof, the L/C
Issuer shall, on the requested date, issue a Dollar Letter of Credit for
the account of the U.S. Borrower (or jointly the U.S. Borrower and the
applicable Subsidiary) or enter into the applicable amendment, as the case
may be, in each case in accordance with the L/C Issuer's usual and
customary business practices. Immediately upon the issuance of each Dollar
Letter of Credit, each U.S. Revolving Credit Lender shall be deemed to,
and hereby irrevocably and unconditionally agrees to, purchase from the
L/C Issuer a risk participation in such Dollar Letter of Credit in an
amount equal to the product of such U.S. Revolving Credit Lender's
Applicable U.S. Revolving Credit Percentage times the amount of such
Dollar Letter of Credit.
(iii) If the U.S. Borrower so requests in any applicable Letter of
Credit Application, the L/C Issuer may, in its sole and absolute
discretion, agree to issue a Dollar Letter of Credit that has automatic
extension provisions (each, an "Auto-Extension Dollar Letter of Credit");
provided that any such Auto-Extension Dollar Letter of Credit must permit
the L/C Issuer to prevent any such extension at least once in each
twelve-month period (commencing with the date of issuance of such Dollar
Letter of Credit) by giving prior notice to the beneficiary thereof not
later than a day (the "NonExtension Notice Date") in each such
twelve-month period to be agreed upon at the time such Letter of Credit is
issued. Unless otherwise directed by the L/C Issuer, the U.S. Borrower
shall not be required to make a specific request to the L/C Issuer for any
such extension. Once an Auto-Extension Dollar Letter of Credit has been
issued, the U.S. Revolving Credit Lenders shall be deemed to have
authorized (but may not require) the L/C Issuer to permit the extension of
such Dollar Letter of Credit at any time to an expiry date not later than
the Dollar Letter of Credit Expiration Date; provided, however, that the
L/C Issuer shall not have an obligation to permit any such extension if
(A) the L/C Issuer has determined that it would not be permitted, or would
have no obligation at such time to issue such Dollar Letter of Credit in
its revised form (as extended) under the
58
terms hereof (by reason of the provisions of clause (ii) or (iii) of
Section 2.03(a) or otherwise), or (B) it has received notice (which may be
by telephone or in writing) on or before the day that is five Business
Days before the NonExtension Notice Date (1) from the Administrative Agent
that the Required Dollar Letter of Credit Lenders have elected not to
permit such extension, (2) from the Administrative Agent, any U.S.
Revolving Credit Lender or the U.S. Borrower that one or more of the
applicable conditions specified in Section 4.02 is not then satisfied, and
in each such case directing the L/C Issuer not to permit such extension or
(3) from the U.S. Borrower directing the L/C Issuer not to permit such
extension.
(iv) Promptly after its delivery of any Dollar Letter of Credit or any
amendment to a Dollar Letter of Credit to an advising bank with respect
thereto or to the beneficiary thereof, the L/C Issuer will also deliver to
the U.S. Borrower and the Administrative Agent a true and complete copy of
such Dollar Letter of Credit or amendment and the Administrative Agent
will give prompt notice of such Dollar Letter of Credit issuance or
amendment to the U.S. Revolving Credit Lenders.
(c) Drawings and Reimbursements; Funding of Participations.
(i) Upon receipt from the beneficiary of any Dollar Letter of Credit
of any notice of a drawing under such Dollar Letter of Credit, the L/C
Issuer shall notify the U.S. Borrower and the Administrative Agent
thereof. If the L/C Issuer notifies the U.S. Borrower of such payment
prior to 11:00 a.m. on the date of any payment by the L/C Issuer under a
Dollar Letter of Credit (each such date, a "Dollar Honor Date"), the U.S.
Borrower shall reimburse the L/C Issuer through the Administrative Agent
in an amount equal to the amount of such drawing on such Dollar Honor
Date; provided, that if such notice is not provided to the U.S. Borrower
prior to 11:00 a.m. on the Dollar Honor Date, then the U.S. Borrower shall
reimburse the L/C Issuer through the Administrative Agent in an amount
equal to the amount of such drawing on the next succeeding Business Day
and such extension of time shall be reflected in computing fees in respect
of any such Dollar Letter of Credit. If the U.S. Borrower fails to so
reimburse the L/C Issuer by such time, the Administrative Agent shall
promptly notify each Revolving Credit Lender of the Dollar Honor Date, the
amount of the unreimbursed drawing (the "Unreimbursed Dollar Amount"), and
the amount of such U.S. Revolving Credit Lender's Applicable U.S.
Revolving Credit Percentage thereof. In such event, the U.S. Borrower
shall be deemed to have requested a U.S. Revolving Credit Borrowing of
Base Rate Loans to be disbursed on the Dollar Honor Date in an amount
equal to the Unreimbursed Amount, without regard to the minimum and
multiples specified in Section 2.02 for the principal amount of Base Rate
Loans, but subject to the amount of the unutilized portion of the U.S.
Revolving Credit Commitments and the conditions set forth in Section 4.02
(other than the delivery of a Committed Loan Notice). Any notice given by
the L/C Issuer or the Administrative Agent pursuant to this Section
2.03(c)(i) may be given by telephone if immediately confirmed in writing;
provided that the lack of such an immediate confirmation shall not affect
the conclusiveness or binding effect of such notice.
(ii) Each U.S. Revolving Credit Lender shall upon receipt of any
notice pursuant to Section 2.03(c)(i) make funds available to the
Administrative Agent for the
59
account of the L/C Issuer at the Administrative Agent's Office in an
amount equal to its Applicable U.S. Revolving Credit Percentage of the
Unreimbursed Dollar Amount not later than 1:00 p.m. on the Business Day
specified in such notice by the Administrative Agent, whereupon, subject
to the provisions of Section 2.03(c)(iii), each U.S. Revolving Credit
Lender that so makes funds available shall be deemed to have made a Base
Rate Loan to the U.S. Borrower in such amount. The Administrative Agent
shall remit the funds so received to the L/C Issuer.
(iii) With respect to any Unreimbursed Dollar Amount that is not fully
refinanced by a U.S. Revolving Credit Borrowing of Base Rate Loans because
the conditions set forth in Section 4.02 (other than the delivery of a
Committed Loan Notice, which is not required to be satisfied) cannot be
satisfied or for any other reason, the U.S. Borrower shall be deemed to
have incurred from the L/C Issuer a Dollar L/C Borrowing in the amount of
the Unreimbursed Dollar Amount that is not so refinanced, which Dollar L/C
Borrowing shall be due and payable on demand (together with interest) and
shall bear interest at the Default Rate. In such event, each U.S.
Revolving Credit Lender's payment to the Administrative Agent for the
account of the L/C Issuer pursuant to Section 2.03(c)(ii) shall be deemed
payment in respect of its participation in such Dollar L/C Borrowing and
shall constitute a Dollar L/C Advance from such Lender in satisfaction of
its participation obligation under this Section 2.03.
(iv) Until a U.S. Revolving Credit Lender funds its U.S. Revolving
Credit Loan or Dollar L/C Advance pursuant to this Section 2.03(c) to
reimburse the L/C Issuer for any amount drawn under any Dollar Letter of
Credit, interest in respect of such Lender's Applicable U.S. Revolving
Credit Percentage of such amount shall be solely for the account of the
L/C Issuer.
(v) Each U.S. Revolving Credit Lender's obligation to make U.S.
Revolving Credit Loans or Dollar L/C Advances to reimburse the L/C Issuer
for amounts drawn under Dollar Letters of Credit, as contemplated by this
Section 2.03(c), shall be absolute and unconditional and shall not be
affected by any circumstance, including (A) any setoff, counterclaim,
recoupment, defense or other right which such Lender may have against the
L/C Issuer, the U.S. Borrower or any other Person for any reason
whatsoever; (B) the occurrence or continuance of a Default, or (C) any
other occurrence, event or condition, whether or not similar to any of the
foregoing; provided, however, that each U.S. Revolving Credit Lender's
obligation to make U.S. Revolving Credit Loans pursuant to this Section
2.03(c) is subject to the conditions set forth in Section 4.02 (other than
delivery by the U.S. Borrower of a Committed Loan Notice ). No such making
of a Dollar L/C Advance shall relieve or otherwise impair the obligation
of the U.S. Borrower to reimburse the L/C Issuer for the amount of any
payment made by the L/C Issuer under any Dollar Letter of Credit, together
with interest as provided herein.
(vi) If any U.S. Revolving Credit Lender fails to make available to
the Administrative Agent for the account of the L/C Issuer any amount
required to be paid by such Lender pursuant to the foregoing provisions of
this Section 2.03(c) by the time specified in Section 2.03(c)(ii), the L/C
Issuer shall be entitled to recover from such Lender (acting through the
Administrative Agent), on demand, such amount with interest
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thereon for the period from the date such payment is required to the date
on which such payment is immediately available to the L/C Issuer at a rate
per annum equal to the greater of the Federal Funds Rate and a rate
determined by the L/C Issuer in accordance with banking industry rules on
interbank compensation from time to time in effect. A certificate of the
L/C Issuer submitted to any U.S. Revolving Credit Lender (through the
Administrative Agent) with respect to any amounts owing under this Section
2.03(c)(vi) shall be conclusive absent manifest error.
(d) Repayment of Participations.
(i) At any time after the L/C Issuer has made a payment under any
Dollar Letter of Credit and has received from any U.S. Revolving Credit
Lender such Lender's L/C Advance in respect of such payment in accordance
with Section 2.03(c), if the Administrative Agent receives for the account
of the L/C Issuer any payment in respect of the related Unreimbursed
Dollar Amount or interest thereon (whether directly from the U.S. Borrower
or otherwise, including proceeds of Cash Collateral applied thereto by the
Administrative Agent), the Administrative Agent will distribute to such
Lender its Applicable U.S. Revolving Credit Percentage thereof
(appropriately adjusted, in the case of interest payments, to reflect the
period of time during which such Lender's Dollar L/C Advance was
outstanding) in the same funds as those received by the Administrative
Agent.
(ii) If any payment received by the Administrative Agent for the
account of the L/C Issuer pursuant to Section 2.03(c)(i) is required to be
returned under any of the circumstances described in Section 10.05
(including pursuant to any settlement entered into by the L/C Issuer in
its discretion), each U.S. Revolving Credit Lender shall pay to the
Administrative Agent for the account of the L/C Issuer its Applicable U.S.
Revolving Credit Percentage thereof on demand of the Administrative Agent,
plus interest thereon from the date of such demand to the date such amount
is returned by such Lender, at a rate per annum equal to the Federal Funds
Rate from time to time in effect. The obligations of the Lenders under
this clause shall survive the payment in full of the Obligations and the
termination of this Agreement.
(e) Obligations Absolute. The obligation of the U.S. Borrower to
reimburse the L/C Issuer for each drawing under each Dollar Letter of Credit
and to repay each Dollar L/C Borrowing shall be absolute, unconditional and
irrevocable, and shall be paid strictly in accordance with the terms of this
Agreement under all circumstances, including the following:
(i) any lack of validity or enforceability of such Dollar Letter of
Credit, this Agreement, or any other Loan Document;
(ii) the existence of any claim, counterclaim, setoff, defense or
other right that the U.S. Borrower or any Subsidiary may have at any time
against any beneficiary or any transferee of such Dollar Letter of Credit
(or any Person for whom any such beneficiary or any such transferee may be
acting), the L/C Issuer or any other Person, whether in connection with
this Agreement, the transactions contemplated hereby or by such Dollar
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Letter of Credit or any agreement or instrument relating thereto, or any
unrelated transaction;
(iii) any draft, demand, certificate or other document presented under
such Dollar 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; or any loss or delay in the transmission or
otherwise of any document required in order to make a drawing under such
Dollar Letter of Credit;
(iv) any payment by the L/C Issuer under such Dollar Letter of Credit
against presentation of a draft or certificate that does not strictly
comply with the terms of such Dollar Letter of Credit; or any payment made
by the L/C Issuer under such Dollar Letter of Credit to any Person
purporting to be a trustee in bankruptcy, debtor-in-possession, assignee
for the benefit of creditors, liquidator, receiver or other representative
of or successor to any beneficiary or any transferee of such Dollar Letter
of Credit, including any arising in connection with any proceeding under
any Debtor Relief Law;
(v) any other circumstance or happening whatsoever, whether or not
similar to any of the foregoing, including any other circumstance that
might otherwise constitute a defense available to, or a discharge of, the
U.S. Borrower or any of its Subsidiaries.
The U.S. Borrower shall promptly examine a copy of each Dollar Letter
of Credit and each amendment thereto that is delivered to it and, in the event
of any claim of noncompliance with the U.S. Borrower's instructions or other
irregularity, the U.S. Borrower will promptly notify the L/C Issuer. The U.S.
Borrower shall be conclusively deemed to have waived any such claim against the
L/C Issuer and its correspondents unless such notice is given as aforesaid.
(f) Role of L/C Issuer. Each Lender and the U.S. Borrower agree that,
in paying any drawing under a Dollar Letter of Credit, the L/C Issuer shall not
have any responsibility to obtain any document (other than any sight draft,
certificates and documents expressly required by the Dollar Letter of Credit)
or to ascertain or inquire as to the validity or accuracy of any such document
or the authority of the Person executing or delivering any such document. None
of the L/C Issuer, the Administrative Agent, any of their respective Related
Parties nor any correspondent, participant or assignee of the L/C Issuer shall
be liable to any Lender for (i) any action taken or omitted in connection
herewith at the request or with the approval of the U.S. Revolving Credit
Lenders or the Required Dollar Letter of Credit Lenders, as applicable; (ii)
any action taken or omitted in the absence of gross negligence or willful
misconduct; or (iii) the due execution, effectiveness, validity or
enforceability of any document or instrument related to any Dollar Letter of
Credit or Issuer Document. The U.S. Borrower hereby assumes all risks of the
acts or omissions of any beneficiary or transferee with respect to its use of
any Dollar Letter of Credit; provided, however, that this assumption is not
intended to, and shall not, preclude the U.S. Borrower's pursuing such rights
and remedies as it may have against the beneficiary or transferee at law or
under any other agreement. None of the L/C Issuer, the Administrative Agent,
any of their respective Related Parties nor any correspondent, participant or
assignee of the L/C Issuer shall be liable or responsible for any of the
matters described in clauses (i) through (v) of Section 2.03(e); provided,
however, that anything in such
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clauses to the contrary notwithstanding, the U.S. Borrower may have a claim
against the L/C Issuer, and the L/C Issuer may be liable to the U.S. Borrower,
to the extent, but only to the extent, of any direct, as opposed to
consequential or exemplary, damages suffered by the U.S. Borrower which the
U.S. Borrower proves were caused by the L/C Issuer's willful misconduct or
gross negligence or the L/C Issuer's willful or grossly negligent failure to
pay under any Dollar Letter of Credit after the presentation to it by the
beneficiary of a sight draft and certificate(s) strictly complying with the
terms and conditions of a Dollar Letter of Credit. In furtherance and not in
limitation of the foregoing, the L/C Issuer may accept documents that appear on
their face to be in order, without responsibility for further investigation,
regardless of any notice or information to the contrary, and the L/C Issuer
shall not be responsible for the validity or sufficiency of any instrument
transferring or assigning or purporting to transfer or assign a Dollar Letter
of Credit or the rights or benefits thereunder or proceeds thereof, in whole or
in part, which may prove to be invalid or ineffective for any reason.
(g) Cash Collateral. Upon the request of the Administrative Agent,
(i) if the L/C Issuer has honored any full or partial drawing request under any
Dollar Letter of Credit and such drawing has resulted in a Dollar L/C
Borrowing, or (ii) if, as of the Dollar Letter of Credit Expiration Date, any
Dollar L/C Obligation for any reason remains outstanding, the U.S. Borrower
shall, in each case, immediately Cash Collateralize the then Outstanding Amount
of all Dollar L/C Obligations; provided, that all such Cash Collateral or
Backstop L/Cs (each as defined below) shall be denominated in Dollars. Sections
2.07 and 8.02(c) set forth certain additional requirements to deliver Cash
Collateral hereunder. For purposes of this Section 2.03, Section 2.04, Section
2.05, Section 2.07 and Section 8.02(c), "Cash Collateralize" means to pledge
and deposit with or deliver to the Administrative Agent, for the benefit of the
L/C Issuer and the Lenders, as collateral for the L/C Obligations, cash or
deposit account balances ("Cash Collateral") or one or more backstop Letters of
Credit in form and substance acceptable to, and issued by financial
institutions reasonably acceptable to the L/C Issuer (each such Letter of
Credit, a "Backstop L/C") pursuant to documentation in form and substance
reasonably satisfactory to the Administrative Agent and the L/C Issuer (which
documents are hereby consented to by the Lenders). Derivatives of such term
have corresponding meanings. The Borrowers hereby grant to the Administrative
Agent, for the benefit of the L/C Issuer and the Lenders, a security interest
in all such cash, deposit accounts and all balances therein and all proceeds of
the foregoing. Cash Collateral shall be maintained in Cash Collateral Accounts.
If at any time the Administrative Agent determines that any funds held as Cash
Collateral are subject to any right or claim of any Person other than the
Administrative Agent or that the total amount of such funds and Backstop L/Cs
then held by the L/C Issuer in respect of Dollar L/C Obligations is less than
the aggregate Outstanding Amount of all Dollar L/C Obligations, the U.S.
Borrower will, forthwith upon demand by the Administrative Agent either (x)
deliver one or more additional Backstop L/Cs or (y) pay to the Administrative
Agent, as additional funds to be deposited as Cash Collateral aforesaid, an
amount equal to the excess of (a) such aggregate Outstanding Amount over (b)
the total amount of funds, if any, then held as Cash Collateral in respect of
Dollar L/C Obligations that the Administrative Agent determines to be free and
clear of any such right and claim or subjected to such existing Backstop L/Cs.
Upon the drawing of any Dollar Letter of Credit for which funds are on deposit
as Cash Collateral, such funds shall be applied, to the extent permitted under
applicable law, to reimburse the L/C Issuer or the U.S. Revolving Credit
Lenders in accordance with the terms hereof. In the event that the funds held
as Cash Collateral exceed in respect of Dollar L/C Obligations 105% of the
aggregate
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Outstanding Amount of all Dollar L/C Obligations, the L/C Issuer shall, at the
U.S. Borrower's request, refund such excess to the U.S. Borrower so long as no
Default or Event of Default shall have occurred and be continuing. In the event
that the aggregate amount available to be drawn under any Backstop L/C held in
respect to Dollar L/C Obligations exceeds 105% of the aggregate Outstanding
Amount of all Dollar L/C Obligations, the L/C Issuer shall, upon request by the
U.S. Borrower, use reasonable efforts to cause the aggregate among available to
be drawn under any such Backstop L/C to be reduced by the amount of such
excess, so long as no Default or Event of Default shall have occurred and be
continuing.
(h) Applicability of ISP98 and UCP. Unless otherwise expressly agreed
by the L/C Issuer and the U.S. Borrower when a Dollar Letter of Credit is
issued (including any such agreement applicable to an Existing Letter of
Credit), (i) the rules of the ISP shall apply to each standby Dollar Letter of
Credit, and (ii) the rules of the Uniform Customs and Practice for Documentary
Credits, as most recently published by the International Chamber of Commerce at
the time of issuance shall apply to each commercial Dollar Letter of Credit.
(i) Letter of Credit Fees. The U.S. Borrower shall pay to the
Administrative Agent for the account of each U.S. Revolving Credit Lender in
accordance with its Applicable U.S. Revolving Credit Percentage a Letter of
Credit Fee (the "Dollar Letter of Credit Fee") for each Dollar Letter of Credit
equal to the Applicable Rate times the daily amount available to be drawn under
such Dollar Letter of Credit. For purposes of computing the daily amount
available to be drawn under any Dollar Letter of Credit, the amount of such
Dollar Letter of Credit shall be determined in accordance with Section 1.06.
Letter of Credit Fees shall be (i) computed on a quarterly basis in arrears and
(ii) due and payable on the last Business Day of each March, June, September
and December, commencing with the first such date to occur after the issuance
of such Dollar Letter of Credit, on the Dollar Letter of Credit Expiration Date
and thereafter on demand. If there is any change in the Applicable Rate during
any quarter, the daily amount available to be drawn under each standby Dollar
Letter of Credit shall be computed and multiplied by the Applicable Rate
separately for each period during such quarter that such Applicable Rate was in
effect. Notwithstanding anything to the contrary contained herein, upon the
request of the Required Dollar Letter of Credit Lenders, while any Event of
Default exists, all Letter of Credit Fees payable under shall accrue at the
Default Rate.
(j) Fronting Fee and Documentary and Processing Charges Payable to
L/C Issuer. The U.S. Borrower shall pay directly to the L/C Issuer for its own
account a fronting fee (i) with respect to each commercial Dollar Letter of
Credit, at a rate separately agreed between the U.S. Borrower and the L/C
Issuer, computed on the amount of such Dollar Letter of Credit, and payable
upon the issuance thereof, (ii) with respect to any amendment of a commercial
Dollar Letter of Credit increasing the amount of such Dollar Letter of Credit,
at a rate separately agreed between the U.S. Borrower and the L/C Issuer,
computed on the amount of such increase, and payable upon the effectiveness of
such amendment and (iii) with respect to each standby Dollar Letter of Credit,
at a rate separately agreed between the U.S. Borrower and the L/C Issuer,
computed on the daily amount available to be drawn under such Letter of Credit
on a quarterly basis in arrears, and due and payable on the last Business Day
of each calendar quarter, commencing with the first such date to occur after
the issuance of such Dollar Letter of Credit, on the Dollar Letter of Credit
Expiration Date and thereafter on demand. In addition, the U.S. Borrower shall
pay directly to the L/C Issuer for its own account the customary issuance,
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presentation, amendment and other processing fees, and other standard costs and
charges, of the L/C Issuer relating to letters of credit as from time to time
in effect. Such customary fees and standard costs and charges are due and
payable on demand and are nonrefundable.
(k) Conflict with Issuer Documents. In the event of any conflict
between the terms hereof and the terms of any Issuer Document, the terms hereof
shall control.
(l) Letters of Credit Issued for Subsidiaries. Notwithstanding that a
Dollar Letter of Credit issued or outstanding hereunder is in support of any
obligations of, or is for the account of, a Subsidiary, the U.S. Borrower shall
be obligated to reimburse the L/C Issuer hereunder for any and all drawings
under such Dollar Letter of Credit. The U.S. Borrower hereby acknowledges that
the issuance of Dollar Letters of Credit for the account of Subsidiaries inures
to the benefit of the U.S. Borrower, and that the U.S. Borrower's business
derives substantial benefits from the businesses of such Subsidiaries.
(m) Non-Dollar Letters of Credit
(i) The U.S. Borrower agrees that its reimbursement obligation
under Section 2.03(c) and any resulting L/C Borrowing, in each case in
respect of a drawing under any Non-Dollar Letter of Credit, (x) shall
be payable in Dollars at the Dollar Equivalent of such obligation in
the currency in which such Non-Dollar Letter of Credit was issued
(determined on the date of payment) and (y) in lieu of interest
payable pursuant to Section 2.03(c), shall bear interest at a rate per
annum equal to the sum of the Federal Funds Rate plus the Applicable
Rate plus 3% for each day from and including the Dollar Honor Date to
but excluding the date such obligation is paid in full.
(ii) Each Lender agrees that its obligation to make U.S.
Revolving Credit Loans under Section 2.03(c) and to make L/C Advances
for any unpaid reimbursement obligation or L/C Borrowing in respect of
a drawing under any Non-Dollar Letter of Credit shall be payable in
Dollars at the Dollar Equivalent of such obligation in the currency in
which such Non-Dollar Letter of Credit was issued (calculated on the
date of payment) (and, in lieu of interest payable pursuant to Section
2.03(c)(vi), any such amount which is not paid when due shall bear
interest at a rate per annum equal to the Overnight Rate plus,
beginning on the third Business Day after such amount was due, the
Applicable Rate).
(iii) For purposes of determining whether there is availability
for the U.S. Borrower to request, continue or convert any Loan, or
request, extend or increase the face amount of any Letter of Credit,
the Dollar Equivalent of the Outstanding Amount of each Non-Dollar
Letter of Credit shall be calculated on the date such Letter of Credit
is to be issued, extended or increased and on the last day of each
calendar month.
(iv) For purposes of determining (i) the amount of the
Outstanding Amount of Dollar L/C Obligations, (ii) the letter of
credit fee under Section 2.03(i), and (iii) the Total U.S. Revolving
Credit Outstandings in Section 2.07(b)(iv), the Dollar Equivalent of
the Outstanding Amount of any Non-Dollar
65
Letter of Credit shall be determined on each of (1) the date of any
payment by the Issuing Lender in respect of a drawing under such
Non-Dollar Letter of Credit, (2) the last day of each calendar month
and (4) each day on which the U.S. Revolving Credit Commitments are
reduced.
2.04 Euro Letters of Credit.
(a) The Euro Letter of Credit Commitment.
(i) Subject to the terms and conditions set forth herein, (A) the L/C
Issuer agrees, in reliance upon the agreements of the other Euro Currency
Revolving Credit Lenders set forth in this Section 2.04, (1) from time to
time on any Business Day during the period from the Closing Date until the
Euro Letter of Credit Expiration Date, to issue Euro Letters of Credit for
the account of the Euro Borrower (or jointly for the account of the Euro
Borrower and any of its Subsidiaries), and to amend or extend Euro Letters
of Credit previously issued by it, in accordance with Section 2.04(b), and
(2) to honor drawings under the Euro Letters of Credit; and (B) the Euro
Revolving Credit Lenders severally agree to participate in Euro Letters of
Credit issued for the account of the Euro Borrower (or jointly for the
account of the Euro Borrower and any of its Subsidiaries) and any drawings
thereunder; provided that after giving effect to any L/C Credit Extension
with respect to any Euro Letter of Credit, (x) the Total Euro Revolving
Credit Outstandings at such time shall not exceed the Euro Revolving
Credit Facility at such time, (y) the aggregate Outstanding Amount of the
Euro Revolving Credit Loans of any Euro Revolving Credit Lender, plus such
Lender's Applicable Euro Revolving Credit Percentage of the Outstanding
Amount of all Euro L/C Obligations, plus such Lender's Applicable Euro
Revolving Credit Percentage of the Outstanding Amount of all Euro Swing
Line Loans, shall not exceed such Lender's Euro Revolving Credit
Commitment, and (z) the Outstanding Amount of the Euro L/C Obligations at
such time shall not exceed the Euro Letter of Credit Sublimit. Each
request by the Euro Borrower for the issuance or amendment of a Euro
Letter of Credit shall be deemed to be a representation by the Euro
Borrower that the Euro L/C Credit Extension so requested complies with the
conditions set forth in the proviso to the preceding sentence. Within the
foregoing limits, and subject to the terms and conditions hereof, the Euro
Borrower's ability to obtain Euro Letters of Credit shall be fully
revolving, and accordingly the Euro Borrower may, during the foregoing
period, obtain Euro Letters of Credit to replace Euro Letters of Credit
that have expired or that have been drawn upon and reimbursed.
(ii) The L/C Issuer shall not issue any Euro Letter of Credit if
subject to Section 2.04(b)(iii), the expiry date of such requested Euro
Letter of Credit would occur more than twelve months after the date of
issuance or last extension, unless the Required Euro Letter of Credit
Lenders have approved such expiry date.
(iii) The L/C Issuer shall not be under any obligation to issue any
Euro Letter of Credit if:
(A) any order, judgment or decree of any Governmental Authority
or arbitrator shall by its terms purport to enjoin or restrain the L/C
Issuer from
66
issuing such Euro Letter of Credit, or any Law applicable to
the L/C Issuer or any request or directive (whether or not having the
force of law) from any Governmental Authority with jurisdiction over
the L/C Issuer shall prohibit, or request that the L/C Issuer refrain
from, the issuance of letters of credit generally or such Euro Letter
of Credit in particular or shall impose upon the L/C Issuer with
respect to such Euro Letter of Credit any restriction, reserve or
capital requirement (for which the L/C Issuer is not otherwise
compensated hereunder) not in effect on the Closing Date, or shall
impose upon the L/C Issuer any unreimbursed loss, cost or expense
which was not applicable on the Closing Date and which the L/C Issuer
in good faith deems material to it;
(B) the issuance of such Euro Letter of Credit would violate
one or more policies of the L/C Issuer;
(C) except as otherwise agreed by the Administrative Agent and
the L/C Issuer, such Euro Letter of Credit is in an initial stated
amount less than (euro)100,000;
(D) the expiry date of such requested Euro Letter of Credit
would occur after the Euro Letter of Credit Expiration Date, unless
all of the Euro Revolving Credit Lenders have approved such expiry
date.
(E) such Euro Letter of Credit is to be denominated in a
currency other than Euros;
(F) such Euro Letter of Credit contains any provisions for
automatic reinstatement of the stated amount after any drawing
thereunder; or
(G) a default of any Lender's obligations to fund under Section
2.04(c) exists or any Lender is at such time a Defaulting Lender
hereunder, unless the L/C Issuer has entered into satisfactory
arrangements with the Euro Borrower or such Lender to eliminate the
L/C Issuer's risk with respect to such Lender.
(iv) The L/C Issuer shall not amend any Euro Letter of Credit if the
L/C Issuer would not be permitted at such time to issue such Euro Letter
of Credit in its amended form under the terms hereof.
(v) The L/C Issuer shall be under no obligation to amend any Euro
Letter of Credit if (A) the L/C Issuer would have no obligation at such
time to issue such Euro Letter of Credit in its amended form under the
terms hereof, or (B) the beneficiary of such Euro Letter of Credit does
not accept the proposed amendment to such Euro Letter of Credit.
(vi) The L/C Issuer shall act on behalf of the Euro Revolving Credit
Lenders with respect to any Euro Letters of Credit issued by it and the
documents associated therewith, and the L/C Issuer shall have all of the
benefits and immunities (A) provided to the Administrative Agent in
Article IX with respect to any acts taken or omissions suffered by the L/C
Issuer in connection with Euro Letters of Credit issued by it or
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proposed to be issued by it and Issuer Documents pertaining to such Euro
Letters of Credit as fully as if the term "Administrative Agent" as used
in Article IX included the L/C Issuer with respect to such acts or
omissions, and (B) as additionally provided herein with respect to the L/C
Issuer.
(b) Procedures for Issuance and Amendment of Euro Letters of Credit;
Auto-Extension Euro Letters of Credit.
(i) Each Euro Letter of Credit shall be issued or amended, as the
case may be, upon the request of the Euro Borrower delivered to the L/C
Issuer (with a copy to the Administrative Agent) in the form of a Letter
of Credit Application, appropriately completed and signed by a Responsible
Officer of the Euro Borrower. Such Letter of Credit Application must be
received by the L/C Issuer and the Administrative Agent not later than
11:00 a.m. (Relevant Local Time) at least three Business Days (or such
later date and time as the Administrative Agent and the L/C Issuer may
agree in a particular instance in their sole discretion) prior to the
proposed issuance date or date of amendment, as the case may be. In the
case of a request for an initial issuance of a Euro Letter of Credit, such
Letter of Credit Application shall specify in form and detail reasonably
satisfactory to the L/C Issuer: (A) the proposed issuance date of the
requested Euro Letter of Credit (which shall be a Business Day); (B) the
amount thereof; (C) the expiry date thereof; (D) the name and address of
the beneficiary thereof; (E) the documents to be presented by such
beneficiary in case of any drawing thereunder and (F) the full text of any
certificate to be presented by such beneficiary in case of any drawing
thereunder. In the case of a request for an amendment of any outstanding
Euro Letter of Credit, such Letter of Credit Application shall specify in
form and detail reasonably satisfactory to the L/C Issuer (1) the Euro
Letter of Credit to be amended; (2) the proposed date of amendment thereof
(which shall be a Business Day) and (3) the nature of the proposed
amendment. Additionally, the Euro Borrower shall furnish to the L/C Issuer
and the Administrative Agent such other documents and information
pertaining to such requested Euro Letter of Credit issuance or amendment,
including any Issuer Documents, as the L/C Issuer or the Administrative
Agent may reasonably require.
(ii) Promptly after receipt of any Letter of Credit Application, the
L/C Issuer will confirm with the Administrative Agent (by telephone or in
writing) that the Administrative Agent has received a copy of such Letter
of Credit Application from the Euro Borrower and, if not, the L/C Issuer
will provide the Administrative Agent with a copy thereof. Unless the L/C
Issuer has received written notice from any Euro Revolving Credit Lender,
the Administrative Agent or any Loan Party, at least one Business Day
prior to the requested date of issuance or amendment of the applicable
Euro Letter of Credit, that one or more applicable conditions contained in
Section 4.02 shall not then be satisfied, then, subject to the terms and
conditions hereof, the L/C Issuer shall, on the requested date, issue a
Euro Letter of Credit for the account of the Euro Borrower (or jointly the
Euro Borrower and the applicable Subsidiary) or enter into the applicable
amendment, as the case may be, in each case in accordance with the L/C
Issuer's usual and customary business practices. Immediately upon the
issuance of each Euro Letter of Credit, each Euro Revolving Credit Lender
shall be deemed to, and hereby irrevocably and unconditionally agrees to,
purchase from the L/C Issuer a risk participation in such
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Euro Letter of Credit in an amount equal to the product of such Euro
Revolving Credit Lender's Applicable Euro Revolving Credit Percentage
times the amount of such Euro Letter of Credit.
(iii) If the Euro Borrower so requests in any applicable Letter of
Credit Application, the L/C Issuer may, in its sole and absolute
discretion, agree to issue a Euro Letter of Credit that has automatic
extension provisions (each, an "Auto-Extension Euro Letter of Credit");
provided that any such Auto-Extension Euro Letter of Credit must permit
the L/C Issuer to prevent any such extension at least once in each
twelve-month period (commencing with the date of issuance of such Euro
Letter of Credit) by giving prior notice to the beneficiary thereof not
later than the NonExtension Notice Date in each such twelve-month period
to be agreed upon at the time such Euro Letter of Credit is issued. Unless
otherwise directed by the L/C Issuer, the Euro Borrower shall not be
required to make a specific request to the L/C Issuer for any such
extension. Once an Auto-Extension Euro Letter of Credit has been issued,
the Euro Revolving Credit Lenders shall be deemed to have authorized (but
may not require) the L/C Issuer to permit the extension of such Euro
Letter of Credit at any time to an expiry date not later than the Euro
Letter of Credit Expiration Date; provided, however, that the L/C Issuer
shall not have an obligation to permit any such extension if (A) the L/C
Issuer has determined that it would not be permitted, or would have no
obligation at such time to issue such Euro Letter of Credit in its revised
form (as extended) under the terms hereof (by reason of the provisions of
clause (ii) or (iii) of Section 2.04(a) or otherwise), or (B) it has
received notice (which may be by telephone or in writing) on or before the
day that is five Business Days before the NonExtension Notice Date (1)
from the Administrative Agent that the Required Euro Letter of Credit
Lenders have elected not to permit such extension, (2) from the
Administrative Agent, any Euro Revolving Credit Lender or the Euro
Borrower that one or more of the applicable conditions specified in
Section 4.02 is not then satisfied, and in each such case directing the
L/C Issuer not to permit such extension or (3) from the Euro Borrower
directing the L/C Issuer not to permit such extension.
(iv) Promptly after its delivery of any Euro Letter of Credit or any
amendment to a Euro Letter of Credit to an advising bank with respect
thereto or to the beneficiary thereof, the L/C Issuer will also deliver to
the Euro Borrower and the Administrative Agent a true and complete copy of
such Euro Letter of Credit or amendment and the Administrative Agent will
give prompt notice of such Euro Letter of Credit issuance or amendment to
the Euro Revolving Credit Lenders.
(c) Drawings and Reimbursements; Funding of Participations.
(i) Upon receipt from the beneficiary of any Euro Letter of Credit of
any notice of a drawing under such Euro Letter of Credit, the L/C Issuer
shall notify the Euro Borrower and the Administrative Agent thereof. If
the L/C Issuer notifies the Euro Borrower of such payment prior to 11:00
a.m. on the date of any payment by the L/C Issuer under a Euro Letter of
Credit (each such date, a "Euro Honor Date"), the Euro Borrower shall
reimburse the L/C Issuer through the Administrative Agent in an amount
equal to the amount of such drawing. On such Euro Honor Date; provided
that if such
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notice is not provided to the Euro Borrower prior to 11:00 a.m. on the
Euro Honor Date, then the Euro Borrower shall reimburse the L/C Issuer
through the Administrative Agent in an amount equal to the amount of such
drawing on the next succeeding Business Day and such extension of time
shall be reflected in computing fees in respect of any such Euro Letter of
Credit. If the Euro Borrower fails to so reimburse the L/C Issuer by such
time, the Administrative Agent shall promptly notify each Euro Revolving
Credit Lender of the Euro Honor Date, the amount of the unreimbursed
drawing (the "Unreimbursed Euro Amount"), and the amount of such Euro
Revolving Credit Lender's Applicable Euro Revolving Credit Percentage
thereof. In such event, the Euro Borrower shall be deemed to have
requested a Euro Revolving Credit Borrowing of Eurocurrency Rate Loans
with an Interest Period of one month to be disbursed on the Euro Honor
Date in an amount equal to the Unreimbursed Euro Amount, without regard to
the minimum and multiples specified in Section 2.02 for the principal
amount of Eurocurrency Rate Loans, but subject to the amount of the
unutilized portion of the Euro Revolving Credit Commitments and the
conditions set forth in Section 4.02 (other than the delivery of a
Committed Loan Notice). Any notice given by the L/C Issuer or the
Administrative Agent pursuant to this Section 2.04(c)(i) may be given by
telephone if immediately confirmed in writing; provided that the lack of
such an immediate confirmation shall not affect the conclusiveness or
binding effect of such notice.
(ii) Each Euro Revolving Credit Lender shall upon receipt of any
notice pursuant to Section 2.04(c)(i) make funds available to the
Administrative Agent for the account of the L/C Issuer at the
Administrative Agent's Office in an amount equal to its Applicable Euro
Revolving Credit Percentage of the Unreimbursed Euro Amount not later than
1:00 p.m. on the Business Day specified in such notice by the
Administrative Agent, whereupon, subject to the provisions of Section
2.04(c)(iii), each Euro Revolving Credit Lender that so makes funds
available shall be deemed to have made a Eurocurrency Rate Loan with an
Interest Period of one month to the Euro Borrower in such amount. The
Administrative Agent shall remit the funds so received to the L/C Issuer.
(iii) With respect to any Unreimbursed Euro Amount that is not fully
refinanced by a Euro Revolving Credit Borrowing of Eurocurrency Rate Loans
because the conditions set forth in Section 4.02 (other than the delivery
of a Committed Loan Notice, which is not required to be satisfied) cannot
be satisfied or for any other reason, the Euro Borrower shall be deemed to
have incurred from the L/C Issuer a Euro L/C Borrowing in the amount of
the Unreimbursed Euro Amount that is not so refinanced, which Euro L/C
Borrowing shall be due and payable on demand (together with interest) and
shall bear interest at the Default Rate. In such event, each Euro
Revolving Credit Lender's payment to the Administrative Agent for the
account of the L/C Issuer pursuant to Section 2.04(c)(ii) shall be deemed
payment in respect of its participation in such Euro L/C Borrowing and
shall constitute a Euro L/C Advance from such Lender in satisfaction of
its participation obligation under this Section 2.04.
(iv) Until a Euro Revolving Credit Lender funds its Euro Revolving
Credit Loan or Euro L/C Advance pursuant to this Section 2.04(c) to
reimburse the L/C Issuer for any amount drawn under any Euro Letter of
Credit, interest in respect of such
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Lender's Applicable Euro Revolving Credit Percentage of such amount
shall be solely for the account of the L/C Issuer.
(v) Each Euro Revolving Credit Lender's obligation to make Euro
Revolving Credit Loans or Euro L/C Advances to reimburse the L/C Issuer
for amounts drawn under Euro Letters of Credit, as contemplated by this
Section 2.04(c), shall be absolute and unconditional and shall not be
affected by any circumstance, including (A) any setoff, counterclaim,
recoupment, defense or other right which such Lender may have against the
L/C Issuer, the Euro Borrower or any other Person for any reason
whatsoever; (B) the occurrence or continuance of a Default, or (C) any
other occurrence, event or condition, whether or not similar to any of the
foregoing; provided, however, that each Euro Revolving Credit Lender's
obligation to make Euro Revolving Credit Loans pursuant to this Section
2.04(c) is subject to the conditions set forth in Section 4.02 (other than
delivery by the Euro Borrower of a Committed Loan Notice ). No such making
of a Euro L/C Advance shall relieve or otherwise impair the obligation of
the Euro Borrower to reimburse the L/C Issuer for the amount of any
payment made by the L/C Issuer under any Euro Letter of Credit, together
with interest as provided herein.
(vi) If any Euro Revolving Credit Lender fails to make available to
the Administrative Agent for the account of the L/C Issuer any amount
required to be paid by such Lender pursuant to the foregoing provisions of
this Section 2.04(c) by the time specified in Section 2.04(c)(ii), the L/C
Issuer shall be entitled to recover from such Lender (acting through the
Administrative Agent), on demand, such amount with interest thereon for
the period from the date such payment is required to the date on which
such payment is immediately available to the L/C Issuer at a rate per
annum equal to the greater of the Overnight Rate and a rate determined by
the L/C Issuer in accordance with banking industry rules on interbank
compensation from time to time in effect. A certificate of the L/C Issuer
submitted to any Euro Revolving Credit Lender (through the Administrative
Agent) with respect to any amounts owing under this Section 2.04(c)(vi)
shall be conclusive absent manifest error.
(d) Repayment of Participations.
(i) At any time after the L/C Issuer has made a payment under any
Euro Letter of Credit and has received from any Euro Revolving Credit
Lender such Lender's L/C Advance in respect of such payment in accordance
with Section 2.04(c), if the Administrative Agent receives for the account
of the L/C Issuer any payment in respect of the related Unreimbursed Euro
Amount or interest thereon (whether directly from the Euro Borrower or
otherwise, including proceeds of Cash Collateral applied thereto by the
Administrative Agent), the Administrative Agent will distribute to such
Lender its Applicable Euro Revolving Credit Percentage thereof
(appropriately adjusted, in the case of interest payments, to reflect the
period of time during which such Lender's Euro L/C Advance was
outstanding) in the same funds as those received by the Administrative
Agent.
(ii) If any payment received by the Administrative Agent for the
account of the L/C Issuer pursuant to Section 2.04(c)(i) is required to be
returned under any of the
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circumstances described in Section 10.05 (including pursuant to any
settlement entered into by the L/C Issuer in its discretion), each Euro
Revolving Credit Lender shall pay to the Administrative Agent for the
account of the L/C Issuer its Applicable Euro Revolving Credit Percentage
thereof on demand of the Administrative Agent, plus interest thereon from
the date of such demand to the date such amount is returned by such
Lender, at a rate per annum equal to the Overnight Rate from time to time
in effect. The obligations of the Lenders under this clause shall survive
the payment in full of the Obligations and the termination of this
Agreement.
(e) Obligations Absolute. The obligation of the Euro Borrower to
reimburse the L/C Issuer for each drawing under each Euro Letter of Credit and
to repay each Euro L/C Borrowing shall be absolute, unconditional and
irrevocable, and shall be paid strictly in accordance with the terms of this
Agreement under all circumstances, including the following:
(i) any lack of validity or enforceability of such Euro Letter of
Credit, this Agreement, or any other Loan Document;
(ii) the existence of any claim, counterclaim, setoff, defense or
other right that the Euro Borrower or any Subsidiary may have at any time
against any beneficiary or any transferee of such Euro Letter of Credit
(or any Person for whom any such beneficiary or any such transferee may be
acting), the L/C Issuer or any other Person, whether in connection with
this Agreement, the transactions contemplated hereby or by such Euro
Letter of Credit or any agreement or instrument relating thereto, or any
unrelated transaction;
(iii) any draft, demand, certificate or other document presented under
such Euro 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; or any loss or delay in the transmission or
otherwise of any document required in order to make a drawing under such
Euro Letter of Credit;
(iv) any payment by the L/C Issuer under such Euro Letter of Credit
against presentation of a draft or certificate that does not strictly
comply with the terms of such Euro Letter of Credit; or any payment made
by the L/C Issuer under such Euro Letter of Credit to any Person
purporting to be a trustee in bankruptcy, debtor-in-possession, assignee
for the benefit of creditors, liquidator, receiver or other representative
of or successor to any beneficiary or any transferee of such Euro Letter
of Credit, including any arising in connection with any proceeding under
any Debtor Relief Law;
(v) any other circumstance or happening whatsoever, whether or not
similar to any of the foregoing, including any other circumstance that
might otherwise constitute a defense available to, or a discharge of, the
Euro Borrower or any of its Subsidiaries.
The Euro Borrower shall promptly examine a copy of each Euro Letter of
Credit and each amendment thereto that is delivered to it and, in the event of
any claim of noncompliance with the Euro Borrower's instructions or other
irregularity, the Euro Borrower will promptly notify the L/C Issuer. The Euro
Borrower shall be conclusively deemed to have
72
waived any such claim against the L/C Issuer and its correspondents unless such
notice is given as aforesaid.
(f) Role of L/C Issuer. Each Lender and the Euro Borrower agree that,
in paying any drawing under a Euro Letter of Credit, the L/C Issuer shall not
have any responsibility to obtain any document (other than any sight draft,
certificates and documents expressly required by the Euro Letter of Credit) or
to ascertain or inquire as to the validity or accuracy of any such document or
the authority of the Person executing or delivering any such document. None of
the L/C Issuer, the Administrative Agent, any of their respective Related
Parties nor any correspondent, participant or assignee of the L/C Issuer shall
be liable to any Lender for (i) any action taken or omitted in connection
herewith at the request or with the approval of the Euro Revolving Credit
Lenders or the Required Euro Letter of Credit Lenders, as applicable; (ii) any
action taken or omitted in the absence of gross negligence or willful
misconduct; or (iii) the due execution, effectiveness, validity or
enforceability of any document or instrument related to any Euro Letter of
Credit or Issuer Document. The Euro Borrower hereby assumes all risks of the
acts or omissions of any beneficiary or transferee with respect to its use of
any Euro Letter of Credit; provided, however, that this assumption is not
intended to, and shall not, preclude the Euro Borrower's pursuing such rights
and remedies as it may have against the beneficiary or transferee at law or
under any other agreement. None of the L/C Issuer, the Administrative Agent,
any of their respective Related Parties nor any correspondent, participant or
assignee of the L/C Issuer shall be liable or responsible for any of the
matters described in clauses (i) through (v) of Section 2.04(e); provided,
however, that anything in such clauses to the contrary notwithstanding, the
Euro Borrower may have a claim against the L/C Issuer, and the L/C Issuer may
be liable to the Euro Borrower, to the extent, but only to the extent, of any
direct, as opposed to consequential or exemplary, damages suffered by the Euro
Borrower which the Euro Borrower proves were caused by the L/C Issuer's willful
misconduct or gross negligence or the L/C Issuer's willful or grossly negligent
failure to pay under any Euro Letter of Credit after the presentation to it by
the beneficiary of a sight draft and certificate(s) strictly complying with the
terms and conditions of a Euro Letter of Credit. In furtherance and not in
limitation of the foregoing, the L/C Issuer may accept documents that appear on
their face to be in order, without responsibility for further investigation,
regardless of any notice or information to the contrary, and the L/C Issuer
shall not be responsible for the validity or sufficiency of any instrument
transferring or assigning or purporting to transfer or assign a Euro Letter of
Credit or the rights or benefits thereunder or proceeds thereof, in whole or in
part, which may prove to be invalid or ineffective for any reason.
(g) Cash Collateral. Upon the request of the Administrative Agent,
(i) if the L/C Issuer has honored any full or partial drawing request under any
Euro Letter of Credit and such drawing has resulted in a Euro L/C Borrowing, or
(ii) if, as of the Euro Letter of Credit Expiration Date, any Euro L/C
Obligation for any reason remains outstanding, the Euro Borrower shall, in each
case, immediately Cash Collateralize the then Outstanding Amount of all Euro
L/C Obligations; provided that all such cash collateral or Backstop L/Cs shall
be denominated in Euros. The Euro Borrower hereby grants to the Administrative
Agent, for the benefit of the L/C Issuer and the Lenders, a security interest
in all such cash, deposit accounts and all balances therein and all proceeds of
the foregoing. Cash Collateral shall be maintained in Cash Collateral Accounts.
If at any time the Administrative Agent determines that any funds held as Cash
Collateral are subject to any right or claim of any Person other than the
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Administrative Agent or that the total amount of such funds and Backstop L/Cs
held in respect of Euro L/C Obligations is less than the aggregate Outstanding
Amount of all Euro L/C Obligations, the Euro Borrower will, forthwith upon
demand by the Administrative Agent either (x) deliver one or more additional
Backstop L/Cs or (y), pay to the Administrative Agent, as additional funds to
be deposited as Cash Collateral aforesaid, an amount equal to the excess of (a)
such aggregate Outstanding Amount over (b) the total amount of funds, if any,
then held as Cash Collateral in respect in respect of Euro L/C Obligations that
the Administrative Agent determines to be free and clear of any such right and
claim or subject to such existing Backstop L/Cs. Upon the drawing of any Euro
Letter of Credit for which funds are on deposit as Cash Collateral, such funds
shall be applied, to the extent permitted under applicable law, to reimburse
the L/C Issuer or the Euro Revolving Credit Lenders in accordance with the
terms hereof. In the event that the funds held as Cash Collateral in respect of
Euro L/C Obligations exceed 105% of the aggregate Outstanding Amount of all
Euro L/C Obligations, the L/C Issuer shall, at the Euro Borrower's request,
refund such excess to the Euro Borrower so long as no Default or Event of
Default shall have occurred and be continuing. In the event that the aggregate
amount available to be drawn under any Backstop L/C held in respect of Euro L/C
Obligations exceeds the 105% of the aggregate Outstanding Amount of all Euro
L/C Obligations, the L/C Issuer shall, upon request by the Euro Borrower and so
long as no Event of Default shall have occurred and be continuing, use
reasonable efforts to cause the aggregate amount available to be drawn under
any such Backstop L/C to be reduced by the amount of such excess.
(h) Applicability of ISP98 and UCP. Unless otherwise expressly agreed
by the L/C Issuer and the Euro Borrower when a Euro Letter of Credit is issued,
(i) the rules of the ISP shall apply to each standby Euro Letter of Credit, and
(ii) the rules of the Uniform Customs and Practice for Documentary Credits, as
most recently published by the International Chamber of Commerce at the time of
issuance shall apply to each commercial Euro Letter of Credit.
(i) Euro Letter of Credit Fees. The Euro Borrower shall pay to the
Administrative Agent for the account of each Euro Revolving Credit Lender in
accordance with its Applicable Euro Revolving Credit Percentage a Letter of
Credit fee (the "Euro Letter of Credit Fee") for each Euro Letter of Credit
equal to the Applicable Rate times the daily amount available to be drawn under
such Euro Letter of Credit. For purposes of computing the daily amount
available to be drawn under any Euro Letter of Credit, the amount of such Euro
Letter of Credit shall be determined in accordance with Section 1.06. Euro
Letter of Credit Fees shall be (i) computed on a quarterly basis in arrears and
(ii) due and payable on the last Business Day of each March, June, September
and December, commencing with the first such date to occur after the issuance
of such Euro Letter of Credit, on the Euro Letter of Credit Expiration Date and
thereafter on demand. If there is any change in the Applicable Rate during any
quarter, the daily amount available to be drawn under each standby Euro Letter
of Credit shall be computed and multiplied by the Applicable Rate separately
for each period during such quarter that such Applicable Rate was in effect.
Notwithstanding anything to the contrary contained herein, upon the request of
the Required Euro Letter of Credit Lenders, while any Event of Default exists,
all Euro Letter of Credit Fees shall accrue at the Default Rate.
(j) Fronting Fee and Documentary and Processing Charges Payable to
L/C Issuer. The Euro Borrower shall pay directly to the L/C Issuer for its own
account a fronting fee (i) with respect to each commercial Euro Letter of
Credit, at a rate separately agreed between the
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Euro Borrower and the L/C Issuer, computed on the amount of such Euro Letter of
Credit, and payable upon the issuance thereof, (ii) with respect to any
amendment of a commercial Euro Letter of Credit increasing the amount of such
Euro Letter of Credit, at a rate separately agreed between the Euro Borrower
and the L/C Issuer, computed on the amount of such increase, and payable upon
the effectiveness of such amendment and (iii) with respect to each standby Euro
Letter of Credit, at a rate separately agreed between the Euro Borrower and the
L/C Issuer, computed on the daily amount available to be drawn under such Euro
Letter of Credit on a quarterly basis in arrears, and due and payable on the
last Business Day of each calendar quarter, commencing with the first such date
to occur after the issuance of such Euro Letter of Credit, on the Euro Letter
of Credit Expiration Date and thereafter on demand. In addition, the Euro
Borrower shall pay directly to the L/C Issuer for its own account the customary
issuance, presentation, amendment and other processing fees, and other standard
costs and charges, of the L/C Issuer relating to letters of credit as from time
to time in effect. Such customary fees and standard costs and charges are due
and payable on demand and are nonrefundable.
(k) Conflict with Issuer Documents. In the event of any conflict
between the terms hereof and the terms of any Issuer Document, the terms hereof
shall control.
(l) Euro Letters of Credit Issued for Subsidiaries. Notwithstanding
that a Euro Letter of Credit issued or outstanding hereunder is in support of
any obligations of, or is for the account of, one of its Subsidiaries, the Euro
Borrower shall be obligated to reimburse the L/C Issuer hereunder for any and
all drawings under such Euro Letter of Credit. The Euro Borrower hereby
acknowledges that the issuance of Euro Letters of Credit for the account of its
Subsidiaries inures to the benefit of the Euro Borrower, and that the Euro
Borrower's business derives substantial benefits from the businesses of such
Subsidiaries.
2.05 UK Letters of Credit.
(a) The UK Letter of Credit Commitment.
(i) Subject to the terms and conditions set forth herein, (A) the L/C
Issuer agrees, in reliance upon the agreements of the other UK Revolving
Credit Lenders set forth in this Section 2.05, (1) from time to time on
any Business Day during the period from the Closing Date until the UK
Letter of Credit Expiration Date, to issue UK Letters of Credit for the
account of the UK Borrower (or jointly for the account of the UK Borrower
and any Subsidiary), and to amend or extend UK Letters of Credit
previously issued by it, in accordance with Section 2.05(b), and (2) to
honor drawings under the UK Letters of Credit; and (B) the UK Revolving
Credit Lenders severally agree to participate in UK Letters of Credit
issued for the account of the UK Borrower (or jointly for the account of
the UK Borrower and any of its Subsidiaries) and any drawings thereunder;
provided that after giving effect to any L/C Credit Extension with respect
to any UK Letter of Credit, (x) the Total UK Revolving Credit Outstandings
at such time shall not exceed the UK Revolving Credit Facility at such
time, (y) the aggregate Outstanding Amount of the UK Revolving Credit
Loans of any UK Revolving Credit Lender, plus such Lender's Applicable UK
Revolving Credit Percentage of the Outstanding Amount of all UK L/C
Obligations, plus such Lender's Applicable UK Revolving Credit Percentage
of the Outstanding Amount of all UK Swing Line Loans, shall not exceed
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such Lender's UK Revolving Credit Commitment, and (z) the Outstanding
Amount of the UK L/C Obligations at such time shall not exceed the UK
Letter of Credit Sublimit. Each request by the UK Borrower for the
issuance or amendment of a UK Letter of Credit shall be deemed to be a
representation by the UK Borrower that the L/C Credit Extension so
requested complies with the conditions set forth in the proviso to the
preceding sentence. Within the foregoing limits, and subject to the terms
and conditions hereof, the UK Borrower's ability to obtain UK Letters of
Credit shall be fully revolving, and accordingly the UK Borrower may,
during the foregoing period, obtain UK Letters of Credit to replace UK
Letters of Credit that have expired or that have been drawn upon and
reimbursed.
(ii) The L/C Issuer shall not issue any UK Letter of Credit if subject
to Section 2.05(b)(iii), the expiry date of such requested UK Letter of
Credit would occur more than twelve months after the date of issuance or
last extension, unless the Required UK Letter of Credit Lenders have
approved such expiry date.
(iii) The L/C Issuer shall not be under any obligation to issue any UK
Letter of Credit if:
(A) any order, judgment or decree of any Governmental Authority
or arbitrator shall by its terms purport to enjoin or restrain the L/C
Issuer from issuing such UK Letter of Credit, or any Law applicable to
the L/C Issuer or any request or directive (whether or not having the
force of law) from any Governmental Authority with jurisdiction over
the L/C Issuer shall prohibit, or request that the L/C Issuer refrain
from, the issuance of letters of credit generally or such UK Letter of
Credit in particular or shall impose upon the L/C Issuer with respect
to such UK Letter of Credit any restriction, reserve or capital
requirement (for which the L/C Issuer is not otherwise compensated
hereunder) not in effect on the Closing Date, or shall impose upon the
L/C Issuer any unreimbursed loss, cost or expense which was not
applicable on the Closing Date and which the L/C Issuer in good faith
deems material to it;
(B) the issuance of such UK Letter of Credit would violate one
or more policies of the L/C Issuer;
(C) except as otherwise agreed by the Administrative Agent and
the L/C Issuer, such Letter of Credit is in an initial stated amount
less than (pound)100,000;
(D) the expiry date of such requested UK Letter of Credit would
occur after the UK Letter of Credit Expiration Date, unless all of the
UK Revolving Credit Lenders have approved such expiry date.
(E) such UK Letter of Credit is to be denominated in a currency
other than Pounds Sterling;
(F) such UK Letter of Credit contains any provisions for
automatic reinstatement of the stated amount after any drawing
thereunder; or
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(G) a default of any Lender's obligations to fund under Section
2.05(c) exists or any Lender is at such time a Defaulting Lender
hereunder, unless the L/C Issuer has entered into satisfactory
arrangements with the UK Borrower or such Lender to eliminate the L/C
Issuer's risk with respect to such Lender.
(iv) The L/C Issuer shall not amend any UK Letter of Credit if the L/C
Issuer would not be permitted at such time to issue such UK Letter of
Credit in its amended form under the terms hereof.
(v) The L/C Issuer shall be under no obligation to amend any UK
Letter of Credit if (A) the L/C Issuer would have no obligation at such
time to issue such UK Letter of Credit in its amended form under the terms
hereof, or (B) the beneficiary of such UK Letter of Credit does not accept
the proposed amendment to such UK Letter of Credit.
(vi) The L/C Issuer shall act on behalf of the UK Revolving Credit
Lenders with respect to any UK Letters of Credit issued by it and the
documents associated therewith, and the L/C Issuer shall have all of the
benefits and immunities (A) provided to the Administrative Agent in
Article IX with respect to any acts taken or omissions suffered by the L/C
Issuer in connection with UK Letters of Credit issued by it or proposed to
be issued by it and Issuer Documents pertaining to such UK Letters of
Credit as fully as if the term "Administrative Agent" as used in Article
IX included the L/C Issuer with respect to such acts or omissions, and (B)
as additionally provided herein with respect to the L/C Issuer.
(b) Procedures for Issuance and Amendment of UK Letters of Credit;
Auto-Extension UK Letters of Credit.
(i) Each UK Letter of Credit shall be issued or amended, as the case
may be, upon the request of the UK Borrower delivered to the L/C Issuer
(with a copy to the Administrative Agent) in the form of a Letter of
Credit Application, appropriately completed and signed by a Responsible
Officer of the UK Borrower. Such Letter of Credit Application must be
received by the L/C Issuer and the Administrative Agent not later than
11:00 a.m. (Relevant Local Time) at least three Business Days (or such
later date and time as the Administrative Agent and the L/C Issuer may
agree in a particular instance in their sole discretion) prior to the
proposed issuance date or date of amendment, as the case may be. In the
case of a request for an initial issuance of a UK Letter of Credit, such
Letter of Credit Application shall specify in form and detail reasonably
satisfactory to the L/C Issuer: (A) the proposed issuance date of the
requested UK Letter of Credit (which shall be a Business Day); (B) the
amount thereof; (C) the expiry date thereof; (D) the name and address of
the beneficiary thereof; (E) the documents to be presented by such
beneficiary in case of any drawing thereunder and (F) the full text of any
certificate to be presented by such beneficiary in case of any drawing
thereunder. In the case of a request for an amendment of any outstanding
UK Letter of Credit, such Letter of Credit Application shall specify in
form and detail reasonably satisfactory to the L/C Issuer (1) the UK
Letter of Credit to be amended; (2) the proposed date of amendment thereof
(which shall be a Business Day) and (3) the nature of the
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proposed amendment. Additionally, the UK Borrower shall furnish to the L/C
Issuer and the Administrative Agent such other documents and information
pertaining to such requested UK Letter of Credit issuance or amendment,
including any Issuer Documents, as the L/C Issuer or the Administrative
Agent may reasonably require.
(ii) Promptly after receipt of any Letter of Credit Application, the
L/C Issuer will confirm with the Administrative Agent (by telephone or in
writing) that the Administrative Agent has received a copy of such Letter
of Credit Application from the UK Borrower and, if not, the L/C Issuer
will provide the Administrative Agent with a copy thereof. Unless the L/C
Issuer has received written notice from any UK Revolving Credit Lender,
the Administrative Agent or any Loan Party, at least one Business Day
prior to the requested date of issuance or amendment of the applicable UK
Letter of Credit, that one or more applicable conditions contained in
Section 4.02 shall not then be satisfied, then, subject to the terms and
conditions hereof, the L/C Issuer shall, on the requested date, issue a UK
Letter of Credit for the account of the UK Borrower (or jointly the UK
Borrower and the applicable Subsidiary) or enter into the applicable
amendment, as the case may be, in each case in accordance with the L/C
Issuer's usual and customary business practices. Immediately upon the
issuance of each UK Letter of Credit, each UK Revolving Credit Lender
shall be deemed to, and hereby irrevocably and unconditionally agrees to,
purchase from the L/C Issuer a risk participation in such UK Letter of
Credit in an amount equal to the product of such UK Revolving Credit
Lender's Applicable UK Revolving Credit Percentage times the amount of
such UK Letter of Credit.
(iii) If the UK Borrower so requests in any applicable UK Letter of
Credit Application, the L/C Issuer may, in its sole and absolute
discretion, agree to issue a UK Letter of Credit that has automatic
extension provisions (each, an "Auto-Extension UK Letter of Credit");
provided that any such Auto-Extension UK Letter of Credit must permit the
L/C Issuer to prevent any such extension at least once in each
twelve-month period (commencing with the date of issuance of such UK
Letter of Credit) by giving prior notice to the beneficiary thereof not
later than the NonExtension Notice Date in each such twelve-month period
to be agreed upon at the time such UK Letter of Credit is issued. Unless
otherwise directed by the L/C Issuer, the UK Borrower shall not be
required to make a specific request to the L/C Issuer for any such
extension. Once an Auto-Extension UK Letter of Credit has been issued, the
UK Revolving Credit Lenders shall be deemed to have authorized (but may
not require) the L/C Issuer to permit the extension of such UK Letter of
Credit at any time to an expiry date not later than the UK Letter of
Credit Expiration Date; provided, however, that the L/C Issuer shall not
have an obligation to permit any such extension if (A) the L/C Issuer has
determined that it would not be permitted, or would have no obligation at
such time to issue such UK Letter of Credit in its revised form (as
extended) under the terms hereof (by reason of the provisions of clause
(ii) or (iii) of Section 2.05(a) or otherwise), or (B) it has received
notice (which may be by telephone or in writing) on or before the day that
is five Business Days before the NonExtension Notice Date (1) from the
Administrative Agent that the Required UK Letter of Credit Lenders have
elected not to permit such extension, (2) from the Administrative Agent,
any UK Revolving Credit Lender or the UK Borrower that one or more of the
applicable conditions specified in Section 4.02 is not then
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satisfied, and in each such case directing the L/C Issuer not to permit
such extension or (3) from the UK Borrower directing the L/C Issuer not to
permit such extension.
(iv) Promptly after its delivery of any UK Letter of Credit or any
amendment to a UK Letter of Credit to an advising bank with respect
thereto or to the beneficiary thereof, the L/C Issuer will also deliver to
the UK Borrower and the Administrative Agent a true and complete copy of
such UK Letter of Credit or amendment and the Administrative Agent will
give prompt notice of such UK Letter of Credit issuance or amendment to
the UK Revolving Credit Lenders.
(c) Drawings and Reimbursements; Funding of Participations.
(i) Upon receipt from the beneficiary of any UK Letter of Credit of
any notice of a drawing under such UK Letter of Credit, the L/C Issuer
shall notify the UK Borrower and the Administrative Agent thereof. If the
L/C Issuer notifies the UK Borrower of such payment prior to 11:00 a.m.
(Relevant Local Time) on the date of any payment by the L/C Issuer under a
UK Letter of Credit (each such date, a "UK Honor Date"), the UK Borrower
shall reimburse the L/C Issuer through the Administrative Agent in an
amount equal to the amount of such drawing on such UK Honor Date; provided
that if such notice is not provided to the UK Borrower prior to 11:00 a.m.
(Relevant Local Time) on the UK Honor Date, then the UK Borrower shall
reimburse the L/C Issuer through the Administrative Agent in an amount
equal to the amount of such drawing on the next succeeding Business Day
and such extension of time shall be reflected in computing fees in respect
of any such UK Letter of Credit. If the UK Borrower fails to so reimburse
the L/C Issuer by such time, the Administrative Agent shall promptly
notify each UK Revolving Credit Lender of the UK Honor Date, the amount of
the unreimbursed drawing (the "Unreimbursed UK Amount"), and the amount of
such UK Revolving Credit Lender's Applicable UK Revolving Credit
Percentage thereof. In such event, the UK Borrower shall be deemed to have
requested a UK Revolving Credit Borrowing of Eurocurrency Rate Loans with
an Interest Period of one month to be disbursed on the UK Honor Date in an
amount equal to the Unreimbursed UK Amount, without regard to the minimum
and multiples specified in Section 2.02 for the principal Eurocurrency
Rate Loans, but subject to the amount of the unutilized portion of the UK
Revolving Credit Commitments and the conditions set forth in Section 4.02
(other than the delivery of a Committed Loan Notice). Any notice given by
the L/C Issuer or the Administrative Agent pursuant to this Section
2.05(c)(i) may be given by telephone if immediately confirmed in writing;
provided that the lack of such an immediate confirmation shall not affect
the conclusiveness or binding effect of such notice.
(ii) Each UK Revolving Credit Lender shall upon receipt of any notice
pursuant to Section 2.05(c)(i) make funds available to the Administrative
Agent for the account of the L/C Issuer at the Administrative Agent's
Office in an amount equal to its Applicable UK Revolving Credit Percentage
of the Unreimbursed UK Amount not later than 1:00 p.m. on the Business Day
specified in such notice by the Administrative Agent, whereupon, subject
to the provisions of Section 2.05(c)(iii), each UK Revolving Credit Lender
that so makes funds available shall be deemed to have made a Eurocurrency
Rate
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Loan with an Interest Period of one month to the UK Borrower in such
amount. The Administrative Agent shall remit the funds so received to the
L/C Issuer.
(iii) With respect to any Unreimbursed UK Amount that is not fully
refinanced by a UK Revolving Credit Borrowing of Eurocurrency Rate Loans
because the conditions set forth in Section 4.02 (other than the delivery
of a Committed Loan Notice, which is not required to be satisfied) cannot
be satisfied or for any other reason, the UK Borrower shall be deemed to
have incurred from the L/C Issuer a UK L/C Borrowing in the amount of the
Unreimbursed UK Amount that is not so refinanced, which UK L/C Borrowing
shall be due and payable on demand (together with interest) and shall bear
interest at the Default Rate. In such event, each UK Revolving Credit
Lender's payment to the Administrative Agent for the account of the L/C
Issuer pursuant to Section 2.05(c)(ii) shall be deemed payment in respect
of its participation in such UK L/C Borrowing and shall constitute a UK
L/C Advance from such Lender in satisfaction of its participation
obligation under this Section 2.05.
(iv) Until a UK Revolving Credit Lender funds its UK Revolving Credit
Loan or UK L/C Advance pursuant to this Section 2.05(c) to reimburse the
L/C Issuer for any amount drawn under any UK Letter of Credit, interest in
respect of such Lender's Applicable UK Revolving Credit Percentage of such
amount shall be solely for the account of the L/C Issuer.
(v) Each UK Revolving Credit Lender's obligation to make UK Revolving
Credit Loans or L/C Advances to reimburse the L/C Issuer for amounts drawn
under UK Letters of Credit, as contemplated by this Section 2.05(c), shall
be absolute and unconditional and shall not be affected by any
circumstance, including (A) any setoff, counterclaim, recoupment, defense
or other right which such Lender may have against the L/C Issuer, the UK
Borrower or any other Person for any reason whatsoever; (B) the occurrence
or continuance of a Default, or (C) any other occurrence, event or
condition, whether or not similar to any of the foregoing; provided,
however, that each UK Revolving Credit Lender's obligation to make UK
Revolving Credit Loans pursuant to this Section 2.05(c) is subject to the
conditions set forth in Section 4.02 (other than delivery by the UK
Borrower of a Committed Loan Notice ). No such making of an L/C Advance
shall relieve or otherwise impair the obligation of the UK Borrower to
reimburse the L/C Issuer for the amount of any payment made by the L/C
Issuer under any UK Letter of Credit, together with interest as provided
herein.
(vi) If any UK Revolving Credit Lender fails to make available to the
Administrative Agent for the account of the L/C Issuer any amount required
to be paid by such Lender pursuant to the foregoing provisions of this
Section 2.05(c) by the time specified in Section 2.05(c)(ii), the L/C
Issuer shall be entitled to recover from such Lender (acting through the
Administrative Agent), on demand, such amount with interest thereon for
the period from the date such payment is required to the date on which
such payment is immediately available to the L/C Issuer at a rate per
annum equal to the greater of the Overnight Rate and a rate determined by
the L/C Issuer in accordance with banking industry rules on interbank
compensation from time to time in effect. A certificate of the L/C Issuer
submitted to any UK Revolving Credit Lender (through the
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Administrative Agent) with respect to any amounts owing under this Section
2.05(c)(vi) shall be conclusive absent manifest error.
(d) Repayment of Participations.
(i) At any time after the L/C Issuer has made a payment under any UK
Letter of Credit and has received from any UK Revolving Credit Lender such
Lender's UK L/C Advance in respect of such payment in accordance with
Section 2.05(c), if the Administrative Agent receives for the account of
the L/C Issuer any payment in respect of the related Unreimbursed UK
Amount or interest thereon (whether directly from the UK Borrower or
otherwise, including proceeds of Cash Collateral applied thereto by the
Administrative Agent), the Administrative Agent will distribute to such
Lender its Applicable UK Revolving Credit Percentage thereof
(appropriately adjusted, in the case of interest payments, to reflect the
period of time during which such Lender's UK L/C Advance was outstanding)
in the same funds as those received by the Administrative Agent.
(ii) If any payment received by the Administrative Agent for the
account of the L/C Issuer pursuant to Section 2.05(c)(i) is required to be
returned under any of the circumstances described in Section 10.05
(including pursuant to any settlement entered into by the L/C Issuer in
its discretion), each UK Revolving Credit Lender shall pay to the
Administrative Agent for the account of the L/C Issuer its Applicable UK
Revolving Credit Percentage thereof on demand of the Administrative Agent,
plus interest thereon from the date of such demand to the date such amount
is returned by such Lender, at a rate per annum equal to the Overnight
Rate from time to time in effect. The obligations of the Lenders under
this clause shall survive the payment in full of the Obligations and the
termination of this Agreement.
(e) Obligations Absolute. The obligation of the UK Borrower to
reimburse the L/C Issuer for each drawing under each UK Letter of Credit and to
repay each UK L/C Borrowing shall be absolute, unconditional and irrevocable,
and shall be paid strictly in accordance with the terms of this Agreement under
all circumstances, including the following:
(i) any lack of validity or enforceability of such UK Letter of
Credit, this Agreement, or any other Loan Document;
(ii) the existence of any claim, counterclaim, setoff, defense or
other right that the UK Borrower or any Subsidiary may have at any time
against any beneficiary or any transferee of such UK Letter of Credit (or
any Person for whom any such beneficiary or any such transferee may be
acting), the L/C Issuer or any other Person, whether in connection with
this Agreement, the transactions contemplated hereby or by such UK Letter
of Credit or any agreement or instrument relating thereto, or any
unrelated transaction;
(iii) any draft, demand, certificate or other document presented under
such UK 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; or any loss or delay in the
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transmission or otherwise of any document required in order to make a
drawing under such UK Letter of Credit;
(iv) any payment by the L/C Issuer under such UK Letter of Credit
against presentation of a draft or certificate that does not strictly
comply with the terms of such UK Letter of Credit; or any payment made by
the L/C Issuer under such UK Letter of Credit to any Person purporting to
be a trustee in bankruptcy, debtor-in-possession, assignee for the benefit
of creditors, liquidator, receiver or other representative of or successor
to any beneficiary or any transferee of such UK Letter of Credit,
including any arising in connection with any proceeding under any Debtor
Relief Law;
(v) any other circumstance or happening whatsoever, whether or not
similar to any of the foregoing, including any other circumstance that
might otherwise constitute a defense available to, or a discharge of, the
UK Borrower or any of its Subsidiaries.
The UK Borrower shall promptly examine a copy of each UK Letter of
Credit and each amendment thereto that is delivered to it and, in the event of
any claim of noncompliance with the UK Borrower's instructions or other
irregularity, the UK Borrower will promptly notify the L/C Issuer. The UK
Borrower shall be conclusively deemed to have waived any such claim against the
L/C Issuer and its correspondents unless such notice is given as aforesaid.
(f) Role of L/C Issuer. Each Lender and the UK Borrower agree that,
in paying any drawing under a UK Letter of Credit, the L/C Issuer shall not
have any responsibility to obtain any document (other than any sight draft,
certificates and documents expressly required by the UK Letter of Credit) or to
ascertain or inquire as to the validity or accuracy of any such document or the
authority of the Person executing or delivering any such document. None of the
L/C Issuer, the Administrative Agent, any of their respective Related Parties
nor any correspondent, participant or assignee of the L/C Issuer shall be
liable to any Lender for (i) any action taken or omitted in connection herewith
at the request or with the approval of the UK Revolving Credit Lenders or the
Required UK Letter of Credit Lenders, as applicable; (ii) any action taken or
omitted in the absence of gross negligence or willful misconduct; or (iii) the
due execution, effectiveness, validity or enforceability of any document or
instrument related to any UK Letter of Credit or Issuer Document. The UK
Borrower hereby assumes all risks of the acts or omissions of any beneficiary
or transferee with respect to its use of any UK Letter of Credit; provided,
however, that this assumption is not intended to, and shall not, preclude the
UK Borrower's pursuing such rights and remedies as it may have against the
beneficiary or transferee at law or under any other agreement. None of the L/C
Issuer, the Administrative Agent, any of their respective Related Parties nor
any correspondent, participant or assignee of the L/C Issuer shall be liable or
responsible for any of the matters described in clauses (i) through (v) of
Section 2.05(e); provided, however, that anything in such clauses to the
contrary notwithstanding, the UK Borrower may have a claim against the L/C
Issuer, and the L/C Issuer may be liable to the UK Borrower, to the extent, but
only to the extent, of any direct, as opposed to consequential or exemplary,
damages suffered by the UK Borrower which the UK Borrower proves were caused by
the L/C Issuer's willful misconduct or gross negligence or the L/C Issuer's
willful or grossly negligent failure to pay under any UK Letter of Credit after
the presentation to it by the beneficiary of a sight draft and certificate(s)
strictly complying with the terms and conditions of a UK Letter of Credit. In
furtherance and not in limitation of the
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foregoing, the L/C Issuer may accept documents that appear on their face to be
in order, without responsibility for further investigation, regardless of any
notice or information to the contrary, and the L/C Issuer shall not be
responsible for the validity or sufficiency of any instrument transferring or
assigning or purporting to transfer or assign a UK Letter of Credit or the
rights or benefits thereunder or proceeds thereof, in whole or in part, which
may prove to be invalid or ineffective for any reason.
(g) Cash Collateral. Upon the request of the Administrative Agent,
(i) if the L/C Issuer has honored any full or partial drawing request under any
UK Letter of Credit and such drawing has resulted in a UK L/C Borrowing, or
(ii) if, as of the UK Letter of Credit Expiration Date, any UK L/C Obligations
for any reason remains outstanding, the UK Borrower shall, in each case,
immediately Cash Collateralize the then Outstanding Amount of all UK L/C
Obligations; provided that all such Cash Collateral or Backstop L/Cs shall be
denominated in Pounds Sterling. The UK Borrower hereby grants to the
Administrative Agent, for the benefit of the L/C Issuer and the Lenders, a
security interest in all such cash, deposit accounts and all balances therein
and all proceeds of the foregoing. Cash Collateral shall be maintained in Cash
Collateral Accounts. If at any time the Administrative Agent determines that
any funds held as Cash Collateral are subject to any right or claim of any
Person other than the Administrative Agent or that the total amount of such
funds and Backstop L/Cs held in respect of the UK L/C Obligations is less than
the aggregate Outstanding Amount of all UK L/C Obligations, the UK Borrower
will, forthwith upon demand by the Administrative Agent, either (x) deliver one
or more additional Backstop L/Cs or (y) pay to the Administrative Agent, as
additional funds to be deposited as Cash Collateral aforesaid, an amount equal
to the excess of (a) such aggregate Outstanding Amount over (b) the total
amount of funds, if any, then held as Cash Collateral in respect of UK L/C
Obligations that the Administrative Agent determines to be free and clear of
any such right and claim or subject to such Backstop L/Cs. Upon the drawing of
any UK Letter of Credit for which funds are on deposit as Cash Collateral, such
funds shall be applied, to the extent permitted under applicable law, to
reimburse the L/C Issuer or the UK Revolving Credit Lenders in accordance with
the terms hereof. In the event that the funds held as Cash Collateral exceed
105% of the aggregate Outstanding Amount of all UK L/C Obligations, the L/C
Issuer shall, at the UK Borrower's request, refund such excess to the UK
Borrower so long as no Default or Event of Default shall have occurred and be
continuing. In the event that the aggregate amount available to be drawn under
any Backstop L/C held in respect of UK L/C Obligations exceeds the 105% of the
aggregate Outstanding Amount of all UK L/C Obligations, the L/C Issuer shall,
upon request by the UK Borrower and so long as no Event of Default shall have
occurred and be continuing, use reasonable efforts to cause the aggregate
amount available to be drawn under any such Backstop L/C to be reduced by the
amount of such excess.
(h) Applicability of ISP98. Unless otherwise expressly agreed by the
L/C Issuer and the UK Borrower when a UK Letter of Credit is issued, (i) the
rules of the ISP shall apply to each UK Letter of Credit.
(i) UK Letter of Credit Fees. The UK Borrower shall pay to the
Administrative Agent for the account of each UK Revolving Credit Lender in
accordance with its Applicable UK Revolving Credit Percentage a Letter of
Credit Fee (the "UK Letter or Credit Fee") for each UK Letter of Credit equal
to the Applicable Rate times the daily amount available to be drawn under such
UK Letter of Credit. For purposes of computing the daily amount
83
available to be drawn under any UK Letter of Credit, the amount of such UK
Letter of Credit shall be determined in accordance with Section 1.06. UK Letter
of Credit Fees shall be (i) computed on a quarterly basis in arrears and (ii)
due and payable on the last Business Day of each March, June, September and
December, commencing with the first such date to occur after the issuance of
such UK Letter of Credit, on the UK Letter of Credit Expiration Date and
thereafter on demand. If there is any change in the Applicable Rate during any
quarter, the daily amount available to be drawn under each UK Letter of Credit
shall be computed and multiplied by the Applicable Rate separately for each
period during such quarter that such Applicable Rate was in effect.
Notwithstanding anything to the contrary contained herein, upon the request of
the Required UK Letter of Credit Lenders, while any Event of Default exists,
all UK Letter of Credit Fees shall accrue at the Default Rate.
(j) Fronting Fee and Documentary and Processing Charges Payable to
L/C Issuer. The UK Borrower shall pay directly to the L/C Issuer for its own
account a fronting fee (i) with respect to each commercial UK Letter of Credit,
at a rate separately agreed between the UK Borrower and the L/C Issuer,
computed on the amount of such UK Letter of Credit, and payable upon the
issuance thereof, (ii) with respect to any amendment of a commercial UK Letter
of Credit increasing the amount of such UK Letter of Credit, at a rate
separately agreed between the UK Borrower and the L/C Issuer, computed on the
amount of such increase, and payable upon the effectiveness of such amendment
and (iii) with respect to each standby UK Letter of Credit, at a rate
separately agreed between the UK Borrower and the L/C Issuer, computed on the
daily amount available to be drawn under such UK Letter of Credit on a
quarterly basis in arrears, and due and payable on the last Business Day of
each calendar quarter, commencing with the first such date to occur after the
issuance of such UK Letter of Credit, on the UK Letter of Credit Expiration
Date and thereafter on demand. In addition, the UK Borrower shall pay directly
to the L/C Issuer for its own account the customary issuance, presentation,
amendment and other processing fees, and other standard costs and charges, of
the L/C Issuer relating to letters of credit as from time to time in effect.
Such customary fees and standard costs and charges are due and payable on
demand and are nonrefundable.
(k) Conflict with Issuer Documents. In the event of any conflict
between the terms hereof and the terms of any Issuer Document, the terms hereof
shall control.
(l) UK Letters of Credit Issued for Subsidiaries. Notwithstanding
that a UK Letter of Credit issued or outstanding hereunder is in support of any
obligations of, or is for the account of, a Subsidiary of the UK Borrower, the
UK Borrower shall be obligated to reimburse the L/C Issuer hereunder for any
and all drawings under such UK Letter of Credit. The UK Borrower hereby
acknowledges that the issuance of UK Letters of Credit for the account of its
Subsidiaries inures to the benefit of the UK Borrower, and that the UK
Borrower's business derives substantial benefits from the businesses of such
Subsidiaries.
2.06 Swing Line Loans.
(a) The Dollar Swing Line. Subject to the terms and conditions set
forth herein, the Swing Line Lender agrees, in reliance upon the agreements of
the other U.S. Revolving Credit Lenders set forth in this Section 2.06, to make
loans (each such loan, a "Dollar Swing Line Loan") denominated in Dollars to
the U.S. Borrower from time to time on any
84
Business Day during the Availability Period in an aggregate amount not to
exceed at any time outstanding the amount of the Dollar Swing Line Sublimit,
notwithstanding the fact that such Dollar Swing Line Loans, when aggregated
with the Applicable U.S. Revolving Credit Percentage of the Outstanding Amount
of U.S. Revolving Credit Loans and Dollar L/C Obligations of the Lender acting
as Swing Line Lender, may exceed the amount of such Lender's U.S. Revolving
Credit Commitment; provided, however, that after giving effect to any Dollar
Swing Line Loan, (i) the Total U.S. Revolving Credit Outstandings shall not
exceed the U.S. Revolving Credit Facility at such time and (ii) the aggregate
Outstanding Amount of the U.S. Revolving Credit Loans of any U.S. Revolving
Credit Lender at such time plus such U.S. Revolving Credit Lender's Applicable
U.S. Revolving Credit Percentage of the Outstanding Amount of all Dollar L/C
Obligations at such time, plus such U.S. Revolving Credit Lender's Applicable
U.S. Revolving Credit Percentage of the Outstanding Amount of all Dollar Swing
Line Loans at such time shall not exceed such Lender's U.S. Revolving Credit
Commitment, and provided further that the U.S. Borrower shall not use the
proceeds of any Dollar Swing Line Loan to refinance any outstanding Swing Line
Loan. Within the foregoing limits, and subject to the other terms and
conditions hereof, the U.S. Borrower may borrow under this Section 2.06(a),
prepay under Section 2.07, and reborrow under this Section 2.06(a). Each Dollar
Swing Line Loan shall be a Base Rate Loan. Immediately upon the making of a
Dollar Swing Line Loan, each U.S. Revolving Credit Lender shall be deemed to,
and hereby irrevocably and unconditionally agrees to, purchase from the Swing
Line Lender a risk participation in such Dollar Swing Line Loan in an amount
equal to the product of such U.S. Revolving Credit Lender's Applicable U.S.
Revolving Credit Percentage times the amount of such Dollar Swing Line Loan.
(b) The Euro Swing Line. Subject to the terms and conditions set
forth herein, the Swing Line Lender agrees, in reliance upon the agreements of
the other Euro Revolving Credit Lenders set forth in this Section 2.06, to make
loans (each such loan a "Euro Swing Line Loan") denominated in Euros to the
Euro Borrower, in each case from time to time on any Business Day during the
Availability Period in an aggregate amount not to exceed at any time
outstanding the amount of the Euro Swing Line Sublimit, notwithstanding the
fact that such Euro Swing Line Loans, when aggregated with the Applicable Euro
Revolving Credit Percentage of the Outstanding Amount of Euro Revolving Credit
Loans and Euro L/C Obligations of the Lender acting as Swing Line Lender, may
exceed the amount of such Lender's Euro Revolving Credit Commitment; provided,
however, that after giving effect to any Euro Swing Line Loan, (i) the Total
Euro Revolving Credit Outstandings shall not exceed the Euro Revolving Credit
Facility at such time and (ii) the aggregate Outstanding Amount of the Euro
Revolving Credit Loans of any Euro Revolving Credit Lender at such time, plus
such Euro Revolving Credit Lender's Applicable Euro Credit Percentage of the
Outstanding Amount of all Euro L/C Obligations at such time, plus such Euro
Revolving Credit Lender's Applicable Euro Revolving Credit Percentage of the
Outstanding Amount of all Euro Swing Line Loans at such time shall not exceed
such Lender's Euro Revolving Credit Commitment, and provided further that the
Euro Borrower shall not use the proceeds of any Euro Swing Line Loan to
refinance any outstanding Swing Line Loan. Within the foregoing limits, and
subject to the other terms and conditions hereof, the Euro Borrower may borrow
under this Section 2.06(b), prepay under Section 2.07, and reborrow under this
Section 2.06(b). Each Euro Swing Line Loan shall be an Overnight Rate Loan.
Immediately upon the making of a Euro Swing Line Loan, each Euro Revolving
Credit Lender shall be deemed to, and hereby irrevocably and unconditionally
agrees
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to, purchase from the Swing Line Lender a risk participation in such Euro Swing
Line Loan in an amount equal to the product of such Euro Revolving Credit
Lender's Applicable Euro Revolving Credit Percentage times the amount of such
Euro Swing Line Loan.
(c) The UK Swing Line. Subject to the terms and conditions set forth
herein, the Swing Line Lender agrees, in reliance upon the agreements of the
other UK Revolving Credit Lenders set forth in this Section 2.06, to make loans
(each such loan, a "UK Swing Line Loan") denominated in Pounds Sterling to the
UK Borrower from time to time on any Business Day during the Availability
Period in an aggregate amount not to exceed at any time outstanding the amount
of the UK Swing Line Sublimit, notwithstanding the fact that such UK Swing Line
Loans, when aggregated with the Applicable UK Revolving Credit Percentage of
the Outstanding Amount of UK Revolving Credit Loans and UK L/C Obligations of
the Lender acting as Swing Line Lender, may exceed the amount of such Lender's
UK Revolving Credit Commitment; provided, however, that after giving effect to
any UK Swing Line Loan, (i) the Total UK Revolving Credit Outstandings shall
not exceed the UK Revolving Credit Facility at such time and (ii) the aggregate
Outstanding Amount of the UK Revolving Credit Loans of any UK Revolving Credit
Lender at such time plus such UK Revolving Credit Lender's Applicable UK
Revolving Credit Percentage of the Outstanding Amount of all UK L/C Obligations
at such time, plus such UK Revolving Credit Lender's Applicable UK Revolving
Credit Percentage of the Outstanding Amount of all UK Swing Line Loans at such
time shall not exceed such Lender's UK Revolving Credit Commitment, and
provided further that the UK Borrower shall not use the proceeds of any UK
Swing Line Loan to refinance any outstanding Swing Line Loan. Within the
foregoing limits, and subject to the other terms and conditions hereof, the UK
Borrower may borrow under this Section 2.06(c), prepay under Section 2.07, and
reborrow under this Section 2.06(c). Each UK Swing Line Loan shall be a
Overnight Rate Loan. Immediately upon the making of a UK Swing Line Loan, each
UK Revolving Credit Lender shall be deemed to, and hereby irrevocably and
unconditionally agrees to, purchase from the Swing Line Lender a risk
participation in such UK Swing Line Loan in an amount equal to the product of
such UK Revolving Credit Lender's Applicable UK Revolving Credit Percentage
times the amount of such UK Swing Line Loan.
(d) Borrowing Procedures. Each Swing Line Borrowing shall be made
upon the applicable Borrower's irrevocable notice to the Swing Line Lender and
the Administrative Agent, which may be given by telephone. Each such notice
must be received by the Swing Line Lender and the Administrative Agent not
later than 1:00 p.m. (Relevant Local Time) on the requested borrowing date, and
shall specify (i) whether the Loan is a Dollar Swing Line Loan, a Euro Swing
Line Loan or a UK Swing Line Loan, (ii) the amount to be borrowed, which shall
be a minimum of U.S.$500,000 in the case of Dollar Swing Line Loans, (euro)
100,000 in the case of Euro Swing Line Loans and (pound) 100,000 in the case of
UK Swing Line Loans, and (iii) the requested borrowing date, which shall be a
Business Day. Each such telephonic notice must be confirmed promptly by
delivery to the Swing Line Lender and the Administrative Agent of a written
Swing Line Loan Notice, appropriately completed and signed by a Responsible
Officer of the applicable Borrower. Promptly after receipt by the Swing Line
Lender of any telephonic Swing Line Loan Notice, the Swing Line Lender will
confirm with the Administrative Agent (by telephone or in writing) that the
Administrative Agent has also received such Swing Line Loan Notice and, if not,
the Swing Line Lender will notify the Administrative Agent (by telephone or in
writing) of the contents thereof. Unless the Swing Line Lender has received
notice (by
86
telephone or in writing) from the Administrative Agent (including at the
request of any U.S. Revolving Credit Lender, Euro Revolving Credit Lender or UK
Revolving Credit Lender, as applicable) prior to 2:00 p.m. (Relevant Local
Time) on the date of the proposed Swing Line Borrowing (A) directing the Swing
Line Lender not to make such Swing Line Loan as a result of the limitations set
forth in the proviso to the first sentence of Section 2.06(a),(b) or (c), as
applicable, or (B) that one or more of the applicable conditions specified in
Section 4.02 is not then satisfied, then, subject to the terms and conditions
hereof, the Swing Line Lender will, not later than 3:00 p.m. (Relevant Local
Time) on the borrowing date specified in such Swing Line Loan Notice, make the
amount of its Swing Line Loan available to the applicable Borrower at its
office by crediting the account of such Borrower on the books of the Swing Line
Lender or by wire transfer in immediately available funds.
(e) Refinancing of Swing Line Loans.
(i) The Swing Line Lender at any time in its sole and absolute
discretion may request, (A) on behalf of the U.S. Borrower (which hereby
irrevocably authorizes the Swing Line Lender to so request on its behalf),
that each U.S. Revolving Credit Lender make a Base Rate Loan in an amount
equal to such Lender's Applicable Percentage of the amount of Dollar Swing
Line Loans then outstanding, (B) on behalf of the Euro Borrower (which
hereby irrevocably authorizes the Swing Line Lender to so request on its
behalf), that each Euro Revolving Credit Lender make a Eurocurrency Rate
Loan with an initial Interest Period of one month in an amount equal to
such Lender's Applicable Percentage of the amount of Euro Swing Line Loans
then outstanding, or (C) on behalf of the UK Borrower (which hereby
irrevocably authorizes the Swing Line Lender to so request on its behalf),
that each UK Revolving Credit Lender make a Eurocurrency Rate Loan with an
initial Interest Period of one month in an amount equal to such Lender's
Applicable Percentage of the amount of UK Swing Line Loans them
outstanding. Such request shall be made in writing (which written request
shall be deemed to be a Committed Loan Notice for purposes hereof) and in
accordance with the requirements of Section 2.02, without regard to the
minimum and multiples specified therein for the principal amount of Base
Rate Loans or Eurocurrency Loans, but subject to the unutilized portion of
the applicable Revolving Credit Facility and the conditions set forth in
Section 4.02. The Swing Line Lender shall furnish the applicable Borrower
with a copy of the applicable Committed Loan Notice promptly after
delivering such notice to the Administrative Agent. Each U.S. Revolving
Credit Lender, each Euro Revolving Credit Lender, or each UK Revolving
Credit Lender, as applicable, shall make an amount equal to its Applicable
U.S. Revolving Credit Percentage, Applicable Euro Revolving Credit
Percentage or Applicable UK Revolving Credit Percentage, respectively, of
the amount specified in such Committed Loan Notice available to the
Administrative Agent in immediately available funds for the account of the
Swing Line Lender at the Administrative Agent's Office not later than 1:00
p.m. (Relevant Local Time) on the day specified in such Committed Loan
Notice, whereupon, subject to Section 2.06(e)(ii), each U.S. Revolving
Credit Lender that so makes funds available shall be deemed to have made a
Base Rate Loan to the U.S. Borrowing in such amount, each Euro Revolving
Credit Lender that so makes funds available shall be deemed to have made a
Eurocurrency Rate Loan (with an initial Interest Period of one month) to
the Euro Borrower in such amount and each UK Revolving Credit Lender that
so makes funds
87
available shall be deemed to have made a Eurocurrency Rate Loan (with an
initial Interest Period of one month) to the UK Borrower in such amount.
The Administrative Agent shall remit the funds so received to the Swing
Line Lender.
(ii) If for any reason any Swing Line Loan cannot be refinanced by
such a Revolving Credit Borrowing in accordance with Section 2.06(e)(i),
the request for Loans submitted by the Swing Line Lender as set forth
herein shall be deemed to be a request by the Swing Line Lender that each
of the applicable Revolving Credit Lenders fund its risk participation in
the relevant Swing Line Loan and each applicable Revolving Credit Lender's
payment to the Administrative Agent for the account of the Swing Line
Lender pursuant to Section 2.06(e)(i) shall be deemed payment in respect
of such participation.
(iii) If any Revolving Credit Lender fails to make available to the
Administrative Agent for the account of the Swing Line Lender any amount
required to be paid by such Lender pursuant to the foregoing provisions of
this Section 2.06(e) by the time specified in Section 2.06(e)(i), the
Swing Line Lender shall be entitled to recover from such Lender (acting
through the Administrative Agent), on demand, such amount with interest
thereon for the period from the date such payment is required to the date
on which such payment is immediately available to the Swing Line Lender at
a rate per annum equal to the greater of the Federal Funds Rate (in the
case of payments in Dollars) or the Overnight Rate (in the case of
payments in Euros or Pounds Sterling) and a rate determined by the Swing
Line Lender in accordance with banking industry rules on interbank
compensation. A certificate of the Swing Line Lender submitted to any
Lender (through the Administrative Agent) with respect to any amounts
owing under this clause (iii) shall be conclusive absent manifest error.
(iv) Each Revolving Credit Lender's obligation to make Revolving
Credit Loans or to purchase and fund risk participations in Swing Line
Loans pursuant to this Section 2.06(e) shall be absolute and unconditional
and shall not be affected by any circumstance, including (A) any setoff,
counterclaim, recoupment, defense or other right which such Lender may
have against the Swing Line Lender, the Borrowers or any other Person for
any reason whatsoever, (B) the occurrence or continuance of a Default, or
(C) any other occurrence, event or condition, whether or not similar to
any of the foregoing; provided, however, that each Revolving Credit
Lender's obligation to make Revolving Credit Loans pursuant to this
Section 2.06(e) is subject to the conditions set forth in Section 4.02. No
such funding of risk participations shall relieve or otherwise impair the
obligation of the applicable Borrowers to repay Swing Line Loans, together
with interest as provided herein.
(f) Repayment of Participations.
(i) At any time after any Revolving Credit Lender has purchased and
funded a risk participation in a Swing Line Loan, if the Swing Line Lender
receives any payment on account of such Swing Line Loan, the Swing Line
Lender will distribute to such Revolving Credit Lender its applicable
Applicable U.S. Revolving Credit Percentage, Applicable Euro Revolving
Credit Percentage or Applicable UK Revolving Credit Percentage, as the
case may be, of such payment (appropriately adjusted, in the case of
88
interest payments, to reflect the period of time during which such
Lender's risk participation was funded) in the same funds as those
received by the Swing Line Lender.
(ii) If any payment received by the Swing Line Lender in respect of
principal or interest on any Dollar Swing Line Loan, Euro Swing Line Loan
or UK Swing Line Loan is required to be returned by the Swing Line Lender
under any of the circumstances described in Section 10.05 (including
pursuant to any settlement entered into by the Swing Line Lender in its
discretion), each U.S. Revolving Credit Lender, Euro Revolving Credit
Lender or UK Revolving Credit Lender, as applicable, shall pay to the
Swing Line Lender its Applicable U.S. Revolving Credit Percentage,
Applicable Euro Revolving Credit Percentage or Applicable UK Revolving
Credit Percentage, respectively, thereof on demand of the Administrative
Agent, plus interest thereon from the date of such demand to the date such
amount is returned, at a rate per annum equal to the Federal Funds Rate
(in the case of payments in Dollars) or the Overnight Rate (in the case of
payments in Euros or Pounds Sterling). The Administrative Agent will make
such demand upon the request of the Swing Line Lender. The obligations of
the Lenders under this clause shall survive the payment in full of the
Obligations and the termination of this Agreement.
(g) Interest for Account of Swing Line Lender. The Swing Line Lender
shall be responsible for invoicing the applicable Borrowers for interest on the
Swing Line Loans. Until each applicable Revolving Credit Lender funds its Base
Rate Loan, Eurocurrency Rate Loan or risk participation pursuant to this
Section 2.06 to refinance such Revolving Credit Lender's Applicable U.S.
Revolving Credit Percentage, Applicable Euro Revolving Credit Percentage or
Applicable UK Revolving Credit Percentage of any Swing Line Loan, interest in
respect of such Applicable U.S. Revolving Credit Percentage, Applicable Euro
Revolving Credit Percentage or Applicable UK Revolving Credit Percentage shall
be solely for the account of the Swing Line Lender.
(h) Payments Directly to Swing Line Lender. The applicable Borrowers
shall make all payments of principal and interest in respect of the Swing Line
Loans directly to the Swing Line Lender.
2.07 Prepayments.
(a) Optional. (i) The Borrowers may, upon notice to the
Administrative Agent, at any time or from time to time voluntarily prepay Loans
in whole or in part without premium or penalty; provided that (A) such notice
must be received by the Administrative Agent not later than 1:00 p.m. (Relevant
Local Time) (1) three Business Days prior to any date of prepayment of
Eurocurrency Rate Loans and (2) on the date of prepayment of Base Rate Loans;
(B) any prepayment of Eurocurrency Rate Loans shall be in a principal amount of
U.S.$5,000,000 or a whole multiple of U.S.$500,000 in excess thereof in the
case of Loans denominated in Dollars, (euro)5,000,000 or a whole multiple of
(euro)500,000 in the case of Loans denominated in Euros, (pound)5,000,000 or a
whole multiple of (pound)500,000 in excess thereof in the case of Loans
denominated in Pounds Sterling and CAD5,000,000 or a whole multiple of
CAD500,000 in excess thereof in the case of Loans denominated in Canadian
Dollars; and (C) any prepayment of Base Rate Loans shall be in a principal
amount of U.S.$500,000 or a whole
89
multiple of U.S.$100,000 in excess thereof or, in each case, if less, the
entire principal amount thereof then outstanding. Each such notice shall
specify the date and amount of such prepayment and the Type(s) of Loans to be
prepaid. The Administrative Agent will promptly notify each Lender of its
receipt of each such notice, and of the amount of such Lender's ratable portion
of such prepayment (based on such Lender's Applicable Percentage in respect of
the relevant Facility). If such notice is given by a Borrower, such Borrower
shall make such prepayment and the payment amount specified in such notice
shall be due and payable on the date specified therein; provided that the
Borrowers may rescind or postpone any such notice of prepayment if such
prepayment would have resulted from a refinancing of all the Loans and such
refinancing shall not be consummated or otherwise shall be delayed. Any
prepayment of a Eurocurrency Rate Loan shall be accompanied by all accrued
interest thereon, together with any additional amounts required pursuant to
Section 3.05. Each prepayment of the outstanding Term Loans pursuant to this
Section 2.07(a) shall be applied (i) ratably to each of the Term Facilities and
(ii) to the principal repayment installments thereof at the U.S. Borrower's
election, and each such prepayment shall be paid to the Lenders in accordance
with their respective Applicable Percentages in respect of each of the relevant
Facilities.
(ii) The applicable Borrowers may, upon notice to the Swing Line
Lender (with a copy to the Administrative Agent), at any time or from time to
time, voluntarily prepay Swing Line Loans in whole or in part without premium
or penalty; provided that (1) such notice must be received by the Swing Line
Lender and the Administrative Agent not later than (x) 1:00 p.m. (Relevant
Local Time) on the date of the prepayment of Dollar Swing Line Loans and (y)
12:00 noon (Relevant Local Time) on the date of prepayment of Euro Swing Line
Loans and UK Swing Line Loans, and (2) any such prepayment shall be in a
minimum principal amount of $100,000 in the case of Dollar Swing Line Loans,
(euro)100,000 in the case of Euro Swing Line Loans or (pound)100,000 in the
case of UK Swing Line Loans. Each such notice shall specify the date and amount
of such prepayment. If such notice is given by a Borrower, such Borrower shall
make such prepayment and the payment amount specified in such notice shall be
due and payable on the date specified therein.
(b) Mandatory. (i) Commencing with the fiscal year ended September
30, 2006, within five Business Days after financial statements have been
delivered pursuant to Section 6.01(a) and the related Compliance Certificate
has been delivered pursuant to Section 6.02(a), the Borrowers shall prepay an
aggregate principal amount of Loans equal to (i) 50% of Excess Cash Flow for
the fiscal year covered by such financial statements if the Consolidated
Leverage Ratio for such fiscal year is greater than or equal to 3.75:1, (ii)
25% of Excess Cash Flow for such fiscal year if the Consolidated Leverage Ratio
for such fiscal year is less than 3.75:1, but greater than or equal to 3.00:1
or (iii) zero, if the Consolidated Leverage Ratio for such fiscal year is less
than 3.00:1.
(ii) If the U.S. Borrower or any of its Subsidiaries Disposes of any
property or assets (other than any Disposition of any property or assets
permitted by Section 7.05(a), (b), (c), (d), (e), (f) or (g)) which in the
aggregate results in the realization by the U.S. Borrower or such Subsidiary of
Net Cash Proceeds (determined as of the date of such Disposition) in excess of
U.S.$15 million in any fiscal year or U.S.$50 million during the term of this
Agreement, the Borrowers shall prepay an aggregate principal amount of Loans
equal to 100% of all Net Cash Proceeds received therefrom within 2 Business
Days after receipt thereof by the U.S. Borrower
90
or such Subsidiary; provided, however, that, with respect to any Net Cash
Proceeds realized under a Disposition described in this Section 2.07(b)(ii), at
the option of the U.S. Borrower (as elected by the U.S. Borrower in writing to
the Administrative Agent on or prior to the date of such Disposition), and so
long as no Event of Default shall have occurred and be continuing, the U.S.
Borrower may reinvest all or any portion of such Net Cash Proceeds in operating
assets so long as (A) within 365 days following receipt of such Net Cash
Proceeds, a definitive agreement for the purchase of such assets with such
proceeds shall have been entered into (as certified by the U.S. Borrower in
writing to the Administrative Agent), and (B) within 545 days after the receipt
of such Net Cash Proceeds, such purchase shall have been consummated (as
certified by the U.S. Borrower in writing to the Administrative Agent);
provided further, however, that any Net Cash Proceeds not subject to such
definitive agreement or so reinvested shall be immediately applied to the
prepayment of the Loans as set forth in this Section 2.07.
(iii) Upon the incurrence or issuance by the U.S. Borrower or any of
its Subsidiaries of any Indebtedness (other than Indebtedness expressly
permitted to be incurred or issued pursuant to Section 7.02), the U.S. Borrower
shall prepay an aggregate principal amount of Loans equal to 100% of all Net
Cash Proceeds received therefrom immediately upon receipt thereof by the U.S.
Borrower or such Subsidiary.
(iv) If for any reason the Total U.S. Revolving Credit Outstandings at
any time exceed the U.S. Revolving Credit Facility at such time, the U.S.
Borrower shall immediately prepay U.S. Revolving Credit Loans, Dollar Swing
Line Loans and Unreimbursed Dollar Amounts and/or Cash Collateralize the Dollar
L/C Obligations in an aggregate amount equal to such excess; provided, however,
that the Euro Borrower shall not be required to Cash Collateralize the Dollar
L/C Obligations pursuant to this Section 2.07(b)(iv) unless after the
prepayment in full of the U.S. Revolving Credit Loans and U.S. Swing Line Loans
the Total U.S. Revolving Credit Outstandings exceed the U.S. Revolving Credit
Facility at such time.
(v) If for any reason the Total Euro Revolving Credit Outstandings at
any time exceed the Euro Revolving Credit Facility at such time, the Euro
Borrower shall immediately prepay Euro Revolving Credit Loans, Euro Swing Line
Loans and Unreimbursed Euro Amounts and/or Cash Collateralize the Euro L/C
Obligations in an aggregate amount equal to such excess; provided, however,
that the Euro Borrower shall not be required to Cash Collateralize the Euro L/C
Obligations pursuant to this Section 2.07(b)(v) unless after the prepayment in
full of the Euro Revolving Credit Loans and Euro Swing Line Loans the Total
Euro Revolving Credit Outstandings exceed the Euro Revolving Credit Facility at
such time.
(vi) If for any reason the Total UK Revolving Credit Outstandings at
any time exceed the UK Revolving Credit Facility at such time, the UK Borrower
shall immediately prepay UK Revolving Credit Loans, UK Swing Line Loans and
Unreimbursed UK Amounts and/or Cash Collateralize the UK L/C Obligations in an
aggregate amount equal to such excess; provided, however, that the UK Borrower
shall not be required to Cash Collateralize the UK L/C Obligations pursuant to
this Section 2.07(b)(vi) unless after the prepayment in full of the UK
Revolving Credit Loans and UK Swing Line Loans the Total UK Revolving Credit
Outstandings exceed the UK Revolving Credit Facility at such time.
91
(vii) Each prepayment of Loans pursuant to Section 2.07(b)(i), (ii)
and (iii) shall be applied, first, ratably to each of the respective Term
Facilities and to the principal repayment installments thereof in direct order
of maturity in respect of payments due within twelve months following the date
of such prepayment, then to the remaining installments on a pro-rata basis and,
thereafter, ratably to each of the Revolving Credit Facilities in the manner
set forth in clauses (viii), (ix) and (x) of this Section 2.07(b).
(viii) Prepayments of the U.S. Revolving Credit Facility made pursuant
to clause (iv) or (vii) of this Section 2.07(b), first, shall be applied
ratably to the Unreimbursed Dollar Amounts and the Dollar Swing Line Loans,
second, shall be applied ratably to the outstanding U.S. Revolving Credit Loans
and, third, shall be used to Cash Collateralize the remaining Dollar L/C
Obligations; and, in the case of prepayments of the U.S. Revolving Credit
Facility required pursuant to clause (iv) of this Section 2.07(b), the amount
remaining, if any, after the prepayment in full of all Unreimbursed Dollar
Amounts, Dollar Swing Line Loans and U.S. Revolving Credit Loans outstanding at
such time and the Cash Collateralization of the remaining Dollar L/C
Obligations in full (the sum of such prepayment amounts, cash collateralization
amounts and remaining amount being, collectively, the "U.S. Reduction Amount")
may be retained by the U.S. Borrower for use in the ordinary course of its
business, and the U.S. Revolving Credit Facility shall be automatically and
permanently reduced by the U.S. Reduction Amount as set forth in Section
2.08(b)(ii). Upon the drawing of any Dollar Letter of Credit that has been Cash
Collateralized, the funds held as Cash Collateral shall be applied (without any
further action by or notice to or from the U.S. Borrower or any other Loan
Party) to reimburse the L/C Issuer or the U.S. Revolving Credit Lenders, as
applicable.
(ix) Prepayments of the Euro Revolving Credit Facility made pursuant
to clause (v) or (vii) of this Section 2.07(b), first, shall be applied ratably
to the Unreimbursed Euro Amounts and the Euro Swing Line Loans, second, shall
be applied ratably to the outstanding Euro Revolving Credit Loans and, third,
shall be used to Cash Collateralize the remaining Euro L/C Obligations; and, in
the case of prepayments of the Euro Revolving Credit Facility required pursuant
to clause (v) of this Section 2.07(b), the amount remaining, if any, after the
prepayment in full of all Unreimbursed Euro Amounts, Euro Swing Line Loans and
Euro Revolving Credit Loans outstanding at such time and the Cash
Collateralization of the remaining Euro L/C Obligations in full (the sum of
such prepayment amounts, cash collateralization amounts and remaining amount
being, collectively, the "Euro Reduction Amount") may be retained by the Euro
Borrower for use in the ordinary course of its business, and the Euro Revolving
Credit Facility shall be automatically and permanently reduced by the Euro
Reduction Amount as set forth in Section 2.08(b)(ii). Upon the drawing of any
Euro Letter of Credit that has been Cash Collateralized, the funds held as Cash
Collateral shall be applied (without any further action by or notice to or from
the Euro Borrower or any other Loan Party) to reimburse the L/C Issuer or the
Euro Revolving Credit Lenders, as applicable.
(x) Prepayments of the UK Revolving Credit Facility made pursuant to
clause (vi) or (vii) of this Section 2.07(b), first, shall be applied ratably
to the Unreimbursed UK Amounts and the UK Swing Line Loans, second, shall be
applied ratably to the outstanding UK Revolving Credit Loans and, third, shall
be used to Cash Collateralize the remaining UK L/C Obligations; and, in the
case of prepayments of the UK Revolving Credit Facility required pursuant to
clause (vi) of this Section 2.07(b), the amount remaining, if any, after the
prepayment
92
in full of all Unreimbursed UK Amounts, UK Swing Line Loans and UK Revolving
Credit Loans outstanding at such time and the Cash Collateralization of the
remaining UK L/C Obligations in full (the sum of such prepayment amounts, cash
collateralization amounts and remaining amount being, collectively, the "UK
Reduction Amount") may be retained by the UK Borrower for use in the ordinary
course of its business, and the UK Revolving Credit Facility shall be
automatically and permanently reduced by the UK Reduction Amount as set forth
in Section 2.08(b)(ii). Upon the drawing of any UK Letter of Credit that has
been Cash Collateralized, the funds held as Cash Collateral shall be applied
(without any further action by or notice to or from the UK Borrower or any
other Loan Party) to reimburse the L/C Issuer or the UK Revolving Credit
Lenders, as applicable.
(xi) Notwithstanding any of the other provisions of Section 2.07(b)(i)
through (x), the applicable Borrower may, in its sole discretion, deposit the
amount of any prepayment required to be made thereunder (on the date on which
such prepayment is required to be made) into a Cash Collateral Account until
the last day of any Interest Period pertaining to Loans being prepaid, at which
time the Administrative Agent shall be authorized (without any further action
by or notice to or from the Borrowers or any other Loan Party) to apply such
amount to the prepayment of such Loans in accordance with this Section 2.07(b).
(xii) Anything contained in this Section 2.07(b) to the contrary
notwithstanding, (A) if, following the occurrence of any "Asset Sale" (as such
term is defined in the 2013 Notes Indenture or the 2015 Notes Indenture) by any
Loan Party or any of its Subsidiaries, the U.S. Borrower is required to commit
by a particular date (a "Commitment Date") to apply or cause its Subsidiaries
to apply an amount equal to any of the "Net Proceeds" (as defined in the 2013
Notes Indenture or the 2015 Notes Indenture) thereof in a particular manner, or
to apply by a particular date (an "Application Date") an amount equal to any
such "Net Proceeds" in a particular manner, in either case in order to excuse
the U.S. Borrower from being required to make an "Asset Sale Offer" (as defined
in the 2013 Notes Indenture or the 2015 Notes Indenture) in connection with
such "Asset Sale", and the U.S. Borrower shall have failed to so commit or to
so apply an amount equal to such "Net Proceeds" before the applicable
Commitment Date or Application Date, as the case may be, or (B) if the U.S.
Borrower at any other time shall have failed to apply or commit or cause to be
applied an amount equal to any such "Net Proceeds", and, thereafter assuming no
further application or commitment of an amount equal to such "Net Proceeds" the
U.S. Borrower would otherwise be required to make an "Asset Sale Offer" in
respect thereof, then in either such case the U.S. Borrower shall immediately
pay or cause to be paid to the Administrative Agent an amount equal to such
"Net Proceeds" to be applied to the payment of the Loans and L/C Borrowings and
to Cash Collateralize the L/C Obligations in the manner set forth in this
Section 2.07(b) in such amounts as shall excuse the U.S. Borrower from making
any such "Asset Sale Offer".
2.08 Termination or Reduction of Commitments.
(a) Optional. The Borrowers may, upon notice to the Administrative
Agent, terminate the unused portions of the Dollar Letter of Credit Sublimit,
the Euro Letter of Credit Sublimit, the UK Letter of Credit Sublimit, the
unused Euro Revolving Credit Commitments, the unused UK Revolving Credit
Commitments or the unused U.S. Revolving Credit Commitments, or from time to
time permanently reduce the unused portions of the Dollar Letter of Credit
93
Sublimit, the Euro Letter of Credit Sublimit, the UK Letter of Credit Sublimit,
the unused Euro Revolving Credit Commitments, the unused UK Revolving Credit
Commitments or the unused U.S. Revolving Credit Commitments; provided that (i)
any such notice shall be received by the Administrative Agent not later than
1:00 p.m. (Relevant Local Time) five Business Days prior to the date of
termination or reduction, (ii) any such partial reduction shall be in an
aggregate amount of $5,000,000 or any whole multiple of $1,000,000 in excess
thereof in respect of the U.S. Revolving Credit Facility, (euro)5,000,000 or
any whole multiple of (euro)1,000,000 in excess thereof in respect of the Euro
Revolving Credit Facility and (pound)5,000,000 or any whole multiple of
(pound)1,000,000 in excess thereof in respect of the UK Revolving Credit
Facility, (iii) the Borrowers shall not terminate or reduce the unused portions
of the Dollar Letter of Credit Sublimit or the unused U.S. Revolving Credit
Commitments if, after giving effect thereto and to any concurrent prepayments
hereunder, the Total U.S. Revolving Credit Outstandings would exceed the U.S.
Revolving Credit Facility, (iv) the Borrowers shall not terminate or reduce the
unused portions of the Euro Letter of Credit Sublimit or the Euro Revolving
Credit Commitments if, after giving effect thereto and to any concurrent
prepayments hereunder, the Total Euro Revolving Credit Outstandings would
exceed the Euro Revolving Credit Facility and (v) the Borrowers shall not
terminate or reduce the unused portions of the UK Letter of Credit Sublimit or
the UK Revolving Credit Commitments if, after giving effect thereto and to any
concurrent prepayments hereunder, the Total UK Revolving Credit Outstandings
would exceed the UK Revolving Credit Facility; provided that the Borrowers may
rescind or postpone any such notice of termination of the Revolving Credit
Commitments if such termination would have resulted from a refinancing of all
the Loans and such refinancing shall not be consummated or otherwise shall be
delayed.
(b) Mandatory. (i) Each of the aggregate Canadian Term Commitments,
aggregate Dollar Term Commitments and aggregate Euro Term Commitments shall be
automatically and permanently reduced to zero on the date of, respectively, the
Canadian Term Borrowing, the Dollar Term Borrowing and the Euro Term Borrowing.
(ii) Each of the Euro Revolving Credit Facility, the U.S. Revolving
Credit Facility and the UK Revolving Credit Facility shall be automatically and
permanently reduced on each date on which the prepayment of Revolving Credit
Loans outstanding thereunder is required to be made pursuant to Section
2.07(b)(i), (ii) or (iii) by an amount equal to the Euro Reduction Amount, the
U.S. Reduction Amount or the UK Reduction Amount, as applicable.
(iii) If after giving effect to any reduction or termination of unused
Revolving Credit Commitments under this Section 2.08, (A) the Dollar Letter of
Credit Sublimit or the Dollar Swing Line Sublimit exceeds the amount of the
U.S. Revolving Credit Facility at such time, such Sublimit shall be
automatically reduced by the amount of such excess, (B) the Euro Swing Line
Sublimit or the Euro Letter of Credit Commitment exceeds the amount of the Euro
Revolving Credit Facility at such time, such Sublimit shall be automatically
reduced by the amount of such excess or (C) the UK Swing Line Sublimit or the
UK Letter of Credit Sublimit exceeds the amount of the UK Revolving Credit
Facility at such time, such Sublimit shall be automatically reduced by the
amount of such excess.
(c) Application of Commitment Reductions; Payment of Fees. The
Administrative Agent will promptly notify the Lenders of any termination or
reduction of unused portions of any Letter of Credit Sublimit, or the unused
Revolving Credit Commitments under
94
this Section 2.08. Upon any reduction of any of the unused Revolving Credit
Commitments, the applicable Revolving Credit Commitment of each applicable
Revolving Credit Lender shall be reduced by such Lender's Applicable U.S.
Revolving Credit Percentage, Applicable Euro Revolving Credit Percentage or
Applicable Revolving Credit Percentage, as the case may be, of such reduction
amount. All fees accrued until the effective date of any termination of the
Aggregate Commitments shall be paid on the effective date of such termination.
2.09 Repayment of Loans.
(a) Canadian Term Loans. The U.S. Borrower shall repay to the
Administrative Agent for the ratable account of the Canadian Term Lenders the
aggregate principal amount of all Canadian Term Loans outstanding on the
following dates in the respective amounts set forth opposite such dates (which
amounts shall be reduced as a result of the application of prepayments in
accordance with the order of priority set forth in Section 2.07):
---------------------------------------------------
Date Amount
---------------------------------------------------
June 30, 2005 CAD $156,000
---------------------------------------------------
September 30, 2005 CAD $156,000
---------------------------------------------------
December 31, 2005 CAD $156,000
---------------------------------------------------
March 31, 2006 CAD $156,000
---------------------------------------------------
June 30, 2006 CAD $156,000
---------------------------------------------------
September 30, 2006 CAD $156,000
---------------------------------------------------
December 31, 2006 CAD $156,000
---------------------------------------------------
March 31, 2007 CAD $156,000
---------------------------------------------------
June 30, 2007 CAD $156,000
---------------------------------------------------
September 30, 2007 CAD $156,000
---------------------------------------------------
December 31, 2007 CAD $156,000
---------------------------------------------------
March 31, 2008 CAD $156,000
---------------------------------------------------
June 30, 2008 CAD $156,000
---------------------------------------------------
September 30, 2008 CAD $156,000
---------------------------------------------------
December 31, 2008 CAD $156,000
---------------------------------------------------
March 31, 2009 CAD $156,000
---------------------------------------------------
June 30, 2009 CAD $156,000
---------------------------------------------------
September 30, 2009 CAD $156,000
---------------------------------------------------
December 31, 2009 CAD $156,000
---------------------------------------------------
March 31, 2010 CAD $156,000
---------------------------------------------------
June 30, 2010 CAD $156,000
---------------------------------------------------
September 30, 2010 CAD $156,000
---------------------------------------------------
December 31, 2010 CAD $156,000
---------------------------------------------------
March 31, 2011 CAD $156,000
---------------------------------------------------
June 30, 2011 CAD $156,000
---------------------------------------------------
September 30, 2011 CAD $156,000
---------------------------------------------------
December 31, 2011 CAD $156,000
---------------------------------------------------
Maturity Date CAD $58,188,000
---------------------------------------------------
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provided, however, that the final principal repayment installment of the
Canadian Term Loans shall be repaid on the Maturity Date for the Canadian Term
Facility under which such Loans were made and in any event shall be in an
amount equal to the aggregate principal amount of all Canadian Term Loans
outstanding on such date.
(b) Dollar Term Loans. The U.S. Borrower shall repay to the
Administrative Agent for the ratable account of the Dollar Term Lenders the
aggregate principal amount of all Dollar Term Loans outstanding on the
following dates in the respective amounts set forth opposite such dates (which
amounts shall be reduced as a result of the application of prepayments in
accordance with the order of priority set forth in Section 2.07):
-----------------------------------------------------
Date Amount
-----------------------------------------------------
June 30, 2005 U.S. $1,350,000
-----------------------------------------------------
September 30, 2005 U.S. $1,350,000
-----------------------------------------------------
December 31, 2005 U.S. $1,350,000
-----------------------------------------------------
March 31, 2006 U.S. $1,350,000
-----------------------------------------------------
June 30, 2006 U.S. $1,350,000
-----------------------------------------------------
September 30, 2006 U.S. $1,350,000
-----------------------------------------------------
December 31, 2006 U.S. $1,350,000
-----------------------------------------------------
March 31, 2007 U.S. $1,350,000
-----------------------------------------------------
June 30, 2007 U.S. $1,350,000
-----------------------------------------------------
September 30, 2007 U.S. $1,350,000
-----------------------------------------------------
December 31, 2007 U.S. $1,350,000
-----------------------------------------------------
March 31, 2008 U.S. $1,350,000
-----------------------------------------------------
June 30, 2008 U.S. $1,350,000
-----------------------------------------------------
September 30, 2008 U.S. $1,350,000
-----------------------------------------------------
December 31, 2008 U.S. $1,350,000
-----------------------------------------------------
March 31, 2009 U.S. $1,350,000
-----------------------------------------------------
June 30, 2009 U.S. $1,350,000
-----------------------------------------------------
September 30, 2009 U.S. $1,350,000
-----------------------------------------------------
December 31, 2009 U.S. $1,350,000
-----------------------------------------------------
March 31, 2010 U.S. $1,350,000
-----------------------------------------------------
June 30, 2010 U.S. $1,350,000
-----------------------------------------------------
September 30, 2010 U.S. $1,350,000
-----------------------------------------------------
December 31, 2010 U.S. $1,350,000
-----------------------------------------------------
March 31, 2011 U.S. $1,350,000
-----------------------------------------------------
June 30, 2011 U.S. $1,350,000
-----------------------------------------------------
September 30, 2011 U.S. $1,350,000
-----------------------------------------------------
December 31, 2011 U.S. $1,350,000
-----------------------------------------------------
Maturity Date U.S. $503,550,000
-----------------------------------------------------
provided, however, that the final principal repayment installment of the Dollar
Term Loans shall be repaid on the Maturity Date for the Dollar Term Facility
under which such Loans were made and in any event shall be in an amount equal
to the aggregate principal amount of all Dollar Term Loans outstanding on such
date.
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(c) Euro Term Loans. The U.S. Borrower shall repay to the
Administrative Agent for the ratable account of the Euro Term Lenders the
aggregate principal amount of all Euro Term Loans outstanding on the following
dates in the respective amounts set forth opposite such dates (which amounts
shall be reduced as a result of the application of prepayments in accordance
with the order of priority set forth in Section 2.07):
----------------------------------------------------
Date Amount
----------------------------------------------------
August 6, 2011 (euro)57,000,000
----------------------------------------------------
Maturity Date (euro)57,000,000
----------------------------------------------------
provided, however, that the final principal repayment installment of the Euro
Term Loans shall be repaid on the Maturity Date for the Euro Term Facility
under which such Loans were made and in any event shall be in an amount equal
to the aggregate principal amount of all Euro Term Loans outstanding on such
date.
(d) Revolving Credit Loans. The U.S. Borrower shall repay to the
Administrative Agent for the ratable account of the U.S. Revolving Credit
Lenders on the Maturity Date for the U.S. Revolving Credit Facility the
aggregate principal amount of all U.S. Revolving Credit Loans outstanding on
such date. The Euro Borrower shall repay to the Administrative Agent for the
ratable account of the Euro Revolving Credit Lenders on the Maturity Date for
the Euro Revolving Credit Facility the aggregate principal amount of all Euro
Revolving Credit Loans outstanding on such date. The UK Borrower shall repay to
the Administrative Agent for the ratable account of the UK Revolving Credit
Lenders on the Maturity Date for the UK Revolving Credit Facility the aggregate
principal amount of all UK Revolving Credit Loans outstanding on such date.
(e) Swing Line Loans. The U.S. Borrower shall repay each Dollar Swing
Line Loan, the Euro Borrower shall repay each Euro Swing Line Loan and the UK
Borrower shall repay each UK Swing Line Loan, in each case on the earlier to
occur of (i) the date ten Business Days after such Loan is made and (ii) the
Maturity Date for the Revolving Credit Facilities.
2.10 Interest.
(a) Subject to the provisions of Section 2.10(b), (i) each
Eurocurrency Rate Loan under a Facility shall bear interest on the outstanding
principal amount thereof for each Interest Period at a rate per annum equal to
the Eurocurrency Rate for such Interest Period plus the Applicable Rate for
such Facility; (ii) each Base Rate Loan under a Facility shall bear interest on
the outstanding principal amount thereof from the applicable borrowing date at
a rate per annum equal to the Base Rate plus the Applicable Rate for such
Facility; (iii) each Dollar Swing Line Loan shall bear interest on the
outstanding principal amount thereof from the applicable borrowing date at a
rate per annum equal to the Base Rate plus the Applicable Rate for the
Revolving Credit Facilities and (iv) each Euro Swing Line Loan and each UK
Swing Line Loan shall bear interest on the outstanding principal amount thereof
from the applicable borrowing date at a rate per annum equal to the Overnight
Rate plus the Applicable Rate for the Revolving Credit Facilities.
97
(b) (i) If any amount of principal of any Loan is not paid when due
(without regard to any applicable grace periods), whether at stated maturity,
by acceleration or otherwise, such amount shall thereafter bear interest at a
fluctuating interest rate per annum at all times equal to the Default Rate to
the fullest extent permitted by applicable Laws.
(ii) If any amount (other than principal of any Loan) payable by a
Borrower under any Loan Document is not paid when due (without regard to any
applicable grace periods), whether at stated maturity, by acceleration or
otherwise, then upon the request of the Required Lenders such amount shall
thereafter bear interest at a fluctuating interest rate per annum at all times
equal to the Default Rate to the fullest extent permitted by applicable Laws.
(iii) Upon the request of the Required Lenders, while any Event of
Default under Sections 8.01(a), (f) or (g) exists, the Borrowers shall pay
interest on the principal amount of all outstanding Obligations hereunder at a
fluctuating interest rate per annum at all times equal to the Default Rate to
the fullest extent permitted by applicable Laws.
(iv) Accrued and unpaid interest on past due amounts (including
interest on past due interest) shall be due and payable upon demand.
(c) Interest on each Loan shall be due and payable in arrears on each
Interest Payment Date applicable thereto and at such other times as may be
specified herein. Interest hereunder shall be due and payable in accordance
with the terms hereof before and after judgment, and before and after the
commencement of any proceeding under any Debtor Relief Law.
2.11 Fees. In addition to certain fees described in Sections 2.03(i)
and (j), 2.04(i) and (j) and 2.05(i) and (j):
(a) Commitment Fee. (i) The U.S. Borrower shall pay to the
Administrative Agent for the account of each U.S. Revolving Credit Lender in
accordance with its Applicable U.S. Revolving Credit Percentage, a commitment
fee equal to the Applicable Rate times the actual daily amount by which the
aggregate U.S. Revolving Credit Commitments exceed the sum of (1) the
Outstanding Amount of U.S. Revolving Credit Loans and (2) the Outstanding
Amount of Dollar L/C Obligations, (ii) the Euro Borrower shall pay to the
Administrative Agent for the account of each Euro Revolving Credit Lender in
accordance with its Applicable Euro Revolving Credit Percentage, a commitment
fee equal to the Applicable Rate times the actual daily amount by which the
aggregate Euro Revolving Credit Commitments exceed the sum of (1) the
Outstanding Amount of Euro Revolving Credit Loans and (2) the Outstanding
Amount of Euro L/C Obligations and (iii) the UK Borrower shall pay to the
Administrative Agent for the account of each UK Revolving Credit Lender in
accordance with its Applicable UK Revolving Credit Percentage a commitment fee
equal to the Applicable Rate times the actual daily amount by which the
aggregate UK Revolving Credit Commitments exceed the sum of (1) the Outstanding
Amount of UK Revolving Credit Loans and (2) the Outstanding Amount of UK L/C
Obligations. The commitment fee shall accrue at all times during the
Availability Period, including at any time during which one or more of the
conditions in Section 4.02 is not met, and shall be due and payable quarterly
in arrears on the last Business Day of each March, June, September and
December, commencing with the first such date to occur after the Closing Date,
and on the
98
Maturity Date for the Revolving Credit Facilities. The commitment fee shall be
calculated quarterly in arrears, and if there is any change in the Applicable
Rate during any quarter, the actual daily amount shall be computed and
multiplied by the Applicable Rate separately for each period during such
quarter that such Applicable Rate was in effect.
(b) Other Fees. (i) The U.S. Borrower shall pay to each of Bank of
America, Merrill Lynch and CNAI and to the Administrative Agent for their own
respective accounts fees in the amounts and at the times specified in the Fee
Letter. Such fees shall be fully earned when paid and shall not be refundable
for any reason whatsoever.
(ii) The U.S. Borrower shall pay to the Administrative Agent,
Arrangers and Joint Bookrunners such fees as shall have been separately agreed
upon in writing in the amounts and at the times so specified. Such fees shall
be fully earned when paid and shall not be refundable for any reason
whatsoever.
2.12 Computation of Interest and Fees. All computations of interest
for Base Rate Loans when the Base Rate is determined by Bank of America's
"prime rate" shall be made on the basis of a year of 365 or 366 days, as the
case may be, and actual days elapsed. All computations of interest for all
Loans denominated in Pounds Sterling shall be made on the basis of a year of
365 days and actual days elapsed. All other computations of fees and interest
shall be made on the basis of a 360-day year and actual days elapsed (which
results in more fees or interest, as applicable, being paid than if computed on
the basis of a 365-day year). Interest shall accrue on each Loan for the day on
which the Loan is made, and shall not accrue on a Loan, or any portion thereof,
for the day on which the Loan or such portion is paid, provided that any Loan
that is repaid on the same day on which it is made shall, subject to Section
2.14(a), bear interest for one day. Each determination by the Administrative
Agent of an interest rate or fee hereunder shall be conclusive and binding for
all purposes, absent manifest error.
2.13 Evidence of Indebtedness.
(a) The Credit Extensions made by each Lender shall be evidenced by
one or more accounts or records maintained by such Lender and by the
Administrative Agent in the ordinary course of business. The accounts or
records maintained by the Administrative Agent and each Lender shall be prima
facie evidence absent manifest error of the amount of the Credit Extensions
made by the Lenders to the Borrowers and the interest and payments thereon. Any
failure to so record or any error in doing so shall not, however, limit or
otherwise affect the obligation of the Borrowers hereunder to pay any amount
owing with respect to the Obligations. In the event of any conflict between the
accounts and records maintained by any Lender and the accounts and records of
the Administrative Agent in respect of such matters, the accounts and records
of the Administrative Agent (set forth in the Register) shall control in the
absence of manifest error. Upon the request of any Lender made through the
Administrative Agent, the applicable Borrower shall execute and deliver to such
Lender (through the Administrative Agent) a Note, which shall evidence such
Lender's Loans in addition to such accounts or records. Each Lender may attach
schedules to its Note and endorse thereon the date, Type (if applicable),
amount and maturity of its Loans and payments with respect thereto.
99
(b) In addition to the accounts and records referred to in Section
2.13(a), each Lender and the Administrative Agent shall maintain in accordance
with its usual practice accounts or records evidencing the purchases and sales
by such Lender of participations in Letters of Credit and Swing Line Loans. In
the event of any conflict between the accounts and records maintained by the
Administrative Agent and the accounts and records of any Lender in respect of
such matters, the accounts and records of the Administrative Agent shall
control in the absence of manifest error.
2.14 Payments Generally; Administrative Agent's Clawback.
(a) General. Except as otherwise expressly provided herein, all
payments to be made by the Borrowers shall be made without condition or
deduction for any counterclaim, defense, recoupment or setoff. Except as
otherwise expressly provided herein, all payments by the Borrowers hereunder
shall be made to the Administrative Agent, for the account of the respective
Lenders to which such payment is owed, at the Administrative Agent's Office in
Dollars or the applicable Foreign Currency and in immediately available funds
not later than 2:00 p.m. on the date specified herein. The Administrative Agent
will promptly distribute to each Lender its Applicable Percentage in respect of
the relevant Facility (or other applicable share as provided herein) of such
payment in like funds as received by wire transfer to such Lender's Lending
Office. All payments received by the Administrative Agent after 2:00 p.m. shall
be deemed received on the next succeeding Business Day and any applicable
interest or fee shall continue to accrue. If any payment to be made by a
Borrower shall come due on a day other than a Business Day, payment shall be
made on the next following Business Day and such extension of time shall be
reflected on computing interest or fees, as the case may be.
(b) (i) Funding by Lenders; Presumption by Administrative Agent.
Unless the Administrative Agent shall have received notice from a Lender prior
to the proposed date of any Borrowing of Eurocurrency Loans (or, in the case of
any Base Rate Loans, prior to 12:00 noon on the date of such Borrowing) that
such Lender will not make available to the Administrative Agent such Lender's
share of such Borrowing, the Administrative Agent may assume that such Lender
has made such share available on such date in accordance with Section 2.02 (or,
in the case of a Borrowing of Base Rate Loans, that such Lender has made such
share available in accordance with and at the time required by Section 2.02)
and may, in reliance upon such assumption, make available to the applicable
Borrower a corresponding amount. In such event, if a Lender has not in fact
made its share of the applicable Borrowing available to the Administrative
Agent, then the applicable Lender and such Borrower severally agree to pay to
the Administrative Agent forthwith on demand such corresponding amount in
immediately available funds with interest thereon, for each day from and
including the date such amount is made available to such Borrower to but
excluding the date of payment to the Administrative Agent, at (A) in the case
of a payment to be made by such Lender, the greater of the Federal Funds Rate
(in the case of Loans denominated in Dollars) or the Overnight Rate (in the
case of Loans denominated in a Foreign Currency) and a rate determined by the
Administrative Agent in accordance with banking industry rules on interbank
compensation and (B) in the case of a payment to be made by a Borrower, the
interest rate applicable to Base Rate Loans (in the case of payments
denominated in Dollars) or the interest rate applicable to Eurocurrency Rate
Loans with an interest period of one month (in the case of payments denominated
in a Foreign Currency). If a Borrower and such Lender shall pay such interest
to the Administrative Agent
100
for the same or an overlapping period, the Administrative Agent shall promptly
remit to such Borrower the amount of such interest paid by such Borrower for
such period. If such Lender pays its share of the applicable Borrowing to the
Administrative Agent, then the amount so paid shall constitute such Lender's
Loan included in such Borrowing. Any payment by a Borrower shall be without
prejudice to any claim such Borrower may have against a Lender that shall have
failed to make such payment to the Administrative Agent.
(ii) Payments by Borrowers; Presumptions by Administrative Agent.
Unless the Administrative Agent shall have received notice from a Borrower
prior to the time at which any payment is due to the Administrative Agent for
the account of the Lenders or the L/C Issuer hereunder that such Borrower will
not make such payment, the Administrative Agent may assume that such Borrower
has made such payment on such date in accordance herewith and may, in reliance
upon such assumption, distribute to the Appropriate Lenders or the L/C Issuer,
as the case may be, the amount due. In such event, if such Borrower has not in
fact made such payment, then each of the Appropriate Lenders or the L/C Issuer,
as the case may be, severally agrees to repay to the Administrative Agent
forthwith on demand the amount so distributed to such Lender or the L/C Issuer,
in immediately available funds with interest thereon, for each day from and
including the date such amount is distributed to it to but excluding the date
of payment to the Administrative Agent, at the greater of the Federal Funds
Rate (in the case of Loans denominated in Dollars) or the Overnight Rate (in
the case of Loans denominated in a Foreign Currency) and a rate determined by
the Administrative Agent in accordance with banking industry rules on interbank
compensation.
A notice of the Administrative Agent to any Lender or any Borrower
with respect to any amount owing under this subsection (b) shall be conclusive,
absent manifest error.
(c) Failure to Satisfy Conditions Precedent. If any Lender makes
available to the Administrative Agent funds for any Loan to be made by such
Lender as provided in the foregoing provisions of this Article II, and such
funds are not made available to the applicable Borrower by the Administrative
Agent because the conditions to the applicable Credit Extension set forth in
Article IV are not satisfied or waived in accordance with the terms hereof,
the Administrative Agent shall return such funds (in like funds as received
from such Lender) to such Lender, without interest.
(d) Obligations of Lenders Several. The obligations of the Lenders
hereunder to make Loans, to fund participations in Letters of Credit and Swing
Line Loans and to make payments pursuant to Section 10.04(c) are several and
not joint. The failure of any Lender to make any Loan, to fund any such
participation or to make any payments under Section 10.04(c) on any date
required hereunder shall not relieve any other Lender of its corresponding
obligation to do so on such date, and no Lender shall be responsible for the
failure of any other Lender to so make its Loan, purchase its participation or
to make its payments under Section 10.04(c).
(e) Funding Source. Nothing herein shall be deemed to obligate any
Lender to obtain the funds for any Loan in any particular place or manner or
to constitute a representation by any Lender that it has obtained or will
obtain the funds for any Loan in any particular place or manner.
101
(f) Insufficient Payment. Whenever any payment received by the
Administrative Agent under this Agreement or any of the other Loan Documents
is insufficient to pay in full all amounts due and payable to the
Administrative Agent and the Lenders under or in respect of this Agreement and
the other Loan Documents on any date, such payment shall be distributed by the
Administrative Agent and applied by the Administrative Agent and the Lenders
in the order of priority set forth in Section 8.03.
(g) To the extent that the Administrative Agent receives funds for
application to the amounts owing by any Borrower under or in respect of this
Agreement in currencies other than the currency or currencies required to
enable the Administrative Agent to distribute funds to the Lenders in
accordance with the terms of this Agreement, the Administrative Agent shall be
entitled to convert or exchange such funds into Dollars or into a Foreign
Currency or from Dollars to a Foreign Currency or from a Foreign Currency to
Dollars, as the case may be, to the extent necessary to enable the Agent to
distribute such funds in accordance with the terms of this Agreement; provided
that each Borrower and each of the Lenders hereby agree that the
Administrative Agent shall not be liable or responsible for any loss, cost or
expense suffered by such Borrower or such Lender as a result of any conversion
or exchange of currencies affected pursuant to this Section 2.14(g) or as a
result of the failure of the Administrative Agent to effect any such
conversion or exchange; and provided further that each applicable Borrower
agrees to indemnify the Administrative Agent and each Lender, and hold the
Administrative Agent and each Lender harmless, for any and all losses, costs
and expenses incurred by the Administrative Agent or any Lender for any
conversion or exchange of currencies (or the failure to convert or exchange
any currencies) or which result in the Administrative Agent or the Lenders
receiving a lower amount that they would have received had such currency not
been required to be so converted or exchanged, in accordance with this Section
2.14(g).
2.15 Sharing of Payments by Lenders. If any Lender shall, by
exercising any right of setoff or counterclaim or any right in respect of
Collateral or otherwise, obtain payment in respect of any principal of or
interest on any of the Loans made by it, or the participations in L/C
Obligations or Swing Line Loans held by it resulting in such Lender's
receiving payment of a proportion of the aggregate amount of such Loans or
participations and accrued interest thereon greater than its pro rata share
thereof of the applicable Facility as provided herein, then the Lender
receiving such greater proportion shall (subject to the provisions of Section
8.03) (a) notify the Administrative Agent of such fact, and (b) purchase (for
cash at face value) participations in the Loans and subparticipations in L/C
Obligations and Swing Line Loans of the other Lenders, or make such other
adjustments as shall be equitable, so that the benefit of all such payments
shall be shared by the Lenders ratably in accordance with the aggregate amount
of principal of and accrued interest on their respective Loans and other
amounts owing them, provided that:
(i) if any such participations or subparticipations are purchased and
all or any portion of the payment giving rise thereto is recovered, such
participations or subparticipations shall be rescinded and the purchase
price restored to the extent of such recovery, without interest; and
(ii) the provisions of this Section shall not be construed to apply to
(x) any payment made by the Borrowers pursuant to and in accordance with
the express terms of
102
this Agreement, (y) any payment obtained by a Lender as consideration for
the assignment of or sale of a participation in any of its Loans or
subparticipations in L/C Obligations and Swing Line Loans to any assignee
or participant, other than to the U.S. Borrower or any Subsidiary thereof
(as to which the provisions of this Section shall apply) or (z) any
payment made to a Non-Consenting Lender pursuant to clause (y) of the
final paragraph of Section 10.01.
Each Loan Party consents to the foregoing and agrees, to the extent
it may effectively do so under applicable law, that any Lender acquiring a
participation pursuant to the foregoing arrangements may exercise against such
Loan Party rights of setoff and counterclaim with respect to such
participation as fully as if such Lender were a direct creditor of such Loan
Party in the amount of such participation.
2.16 Incremental Facility.
(a) The U.S. Borrower may, at any time and from time to time prior to
the Maturity Date, by notice to the Administrative Agent, request the addition
of a new term loan facility (each an "Incremental Term Facility") or a new
revolving credit facility (each an "Incremental Revolving Credit Facility"
and, together with the Incremental Term Facilities, an "Incremental Facility")
denominated in Dollars, Euros or other foreign currencies to be mutually
agreed by the U.S. Borrower and the Administrative Agent pursuant to
additional commitments (the "Incremental Commitments") in an amount up to the
sum of $500,000,000 in the aggregate (provided that the Incremental Revolving
Credit Facilities cannot exceed $100,000,000 in the aggregate) to be effective
as of a date that is at least 90 days prior to the scheduled Maturity Date
then in effect (the "Increase Date") as specified in the related notice to the
Administrative Agent; provided, however, that (i) in no event shall the
aggregate amount of all of the Incremental Commitments exceed $500,000,000 nor
shall the aggregate amount of Incremental Commitments relating to the
Incremental Revolving Credit Facilities exceed $100,000,000, (ii) the U.S.
Borrower may make a maximum of five such requests, (iii) on the date of any
request by the U.S. Borrower for an Incremental Facility and on the related
Increase Date, the applicable conditions set forth in Section 4.02 and in
subsection (d) of this Section 2.16 shall be satisfied, (iv) such Incremental
Facility shall be used for general corporate purposes, including, without
limitation, Permitted Acquisitions (in which case the conditions set forth in
Section 7.03(h) shall be satisfied), (v) the final maturity of such
Incremental Term Facilities is equal to or greater than the final maturity of
the existing Term Facilities and the final maturity of such Incremental
Revolving Credit Facilities is equal to or greater than the final maturity of
the existing Revolving Credit Facilities, (vi) such Incremental Facility is
either (A) an increase in a Facility existing prior to the Increase Date, in
which case the requirements of Section 2.16(e) shall be satisfied or (B) a new
Facility (i.e., not on the same terms as any existing Facility), (vii) such
Incremental Facility shall be on terms no more restrictive than those set
forth in this Agreement and shall contain such other terms as may be agreed by
the U.S. Borrower and the Administrative Agent and (viii) such Incremental
Facility may be made available to a foreign Subsidiary of the U.S. Borrower,
subject to the consent of the Administrative Agent.
(b) If the Administrative Agent approves the terms of the Incremental
Facility (which approval shall not be unreasonably withheld or delayed if such
terms are otherwise in
103
accordance with the provisions of this Agreement), the Administrative Agent
shall promptly notify the Lenders of a request by the U.S. Borrower for
Incremental Commitments, which notice shall include (i) the proposed amount and
other material terms of the Incremental Facility, (ii) the proposed Increase
Date and (iii) the date by which Lenders wishing to participate in the
Incremental Facility must commit to an Incremental Commitment (the "Commitment
Date"). Each Lender that is willing to participate in the requested Incremental
Facility (each an "Increasing Lender") shall, in its sole discretion, give
written notice to the Administrative Agent on or prior to the Commitment Date
of the amount it is willing to commit to the Incremental Facility. If the
Lenders notify the Administrative Agent that they are willing to participate in
an Incremental Facility by an aggregate amount that exceeds the amount of the
requested Incremental Commitments, the requested Incremental Commitments shall
be allocated among the Lenders willing to participate therein in such amounts
as are agreed between the U.S. Borrower and the Administrative Agent.
(c) Promptly following the applicable Commitment Date, the
Administrative Agent shall notify the U.S. Borrower as to the amount, if any,
by which the Lenders are willing to participate in the requested Incremental
Facility. If the aggregate amount by which the Lenders are willing to
participate in the requested Incremental Facility on any such Commitment Date
is less than the requested Incremental Commitments, then the U.S. Borrower may
extend offers to one or more Eligible Assignees to participate in any portion
of the requested Incremental Facility that has not been committed to by the
Lenders as of the Commitment Date; provided, however, that the Commitment of
each such Eligible Assignee shall be in an amount equal to at least
U.S.$1,000,000.
(d) On the applicable Increase Date, each Eligible Assignee that
accepts an offer to participate in a requested Incremental Facility in
accordance with Section 2.16(c) (each such Eligible Assignee, an "Assuming
Lender") shall become a Lender party to this Agreement as of the applicable
Increase Date and the Commitment of each Increasing Lender for such
Incremental Facility shall be so increased by such amount (or by the amount
allocated to such Lender pursuant to the last sentence of Section 2.16(b)) as
of such Increase Date; provided, however, that the Administrative Agent shall
have received on or before the Increase Date the following, each dated such
date:
(i) (A) certified copies of resolutions of the Board of
Directors of the U.S. Borrower approving the Incremental Facility and
the corresponding modifications to this Agreement and (B) an opinion
of counsel for the U.S. Borrower, in a form reasonably satisfactory to
the Administrative Agent;
(ii) an assumption agreement from each Assuming Lender, if any,
in form and substance satisfactory to the U.S. Borrower and the
Administrative Agent (each an "Assumption Agreement"), duly executed
by such Eligible Assignee, the Administrative Agent and the U.S.
Borrower; and
(iii) confirmation from each Increasing Lender of the increase
in the amount of its Commitment in a writing satisfactory to the U.S.
Borrower and the Administrative Agent.
104
On the applicable Increase Date, upon fulfillment of the conditions
set forth in the immediately preceding sentence of this Section 2.16(d), the
Administrative Agent shall notify the Lenders (including each Assuming Lender)
and the U.S. Borrower, on or before 11:00 A.M. (Relevant Local Time), by
telecopier or telex, of the occurrence of the Incremental Facility to be
effected on the related Increase Date and shall record in the Register the
relevant information with respect to each Increasing Lender and each Assuming
Lender on such date.
(e) Notwithstanding anything to the contrary contained above, each
Incremental Facility shall constitute a new Facility, which shall be separate
and distinct from the existing Facilities pursuant to this Agreement, provided
that an Incremental Facility may constitute part of, and be added to, an
existing Facility, so long as:
(i) the advances made under the Incremental Facility shall have
the same final maturity date and same weighted average life to
maturity as the existing Facility to which the new Incremental
Facility is being added, and shall bear interest at the same rates
(i.e., have the same "Applicable Rate") applicable to such Facility;
(ii) the new Incremental Facility shall have the same scheduled
repayment dates as then remain with respect to the existing Facility
to which such new Incremental Facility is being added, with the amount
of each scheduled repayment installment of the new Incremental
Facility to be the same (on a proportionate basis) as is theretofore
applicable to the existing Facility to which such new Incremental
Facility is being added; and
(iii) on the date of the making of loan under the new
Incremental Facility, and notwithstanding anything to the contrary in
Section 2.07, the aggregate principal amount of such new loan shall be
added to (and form part of) each Borrowing of outstanding Loans of the
respective Facility on a pro rata basis (based on the relative sizes
of the various outstanding Borrowings), so that each Lender will
participate proportionately in each then outstanding Borrowing under
the respective Facility, and so that the existing Lenders with respect
to such Facility continue to have the same participation (by amount)
in each Borrowing as they had before the making of the new advances
under such Facility.
To the extent the provisions of the preceding clause (iii) require
that Lenders making new loans under an Incremental Facility add the aggregate
principal amount of such new loans to the then outstanding Loans of
Eurocurrency Rate Advances, it is acknowledged that the effect thereof may
result in such new advances having short Interest Periods (i.e. an Interest
Period that will begin during an Interest Period then applicable to the
outstanding Eurocurrency Rate Advances and which will end on the last day of
such Interest Period). In connection therewith, the U.S. Borrower may agree to
compensate the Lenders making the advances under the new Incremental Facility
for funding Eurocurrency Rate Advances during an existing Interest Period on
such basis as may be agreed by the U.S. Borrower and the respective Lender or
Lenders.
(f) Conflicting Provisions. This Section shall supersede any
provisions in Sections 2.15 or 10.01 to the contrary.
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ARTICLE III
TAXES, YIELD PROTECTION AND ILLEGALITY
3.01 Taxes.
(a) Payments Free of Taxes. Any and all payments by or on account of
any obligation of the Borrowers hereunder or under any other Loan Document
shall be made free and clear of and without reduction or withholding for any
Indemnified Taxes or Other Taxes, provided that if any Borrower shall be
required by applicable Law to deduct any Indemnified Taxes (including any
Other Taxes) from such payments, then (i) the sum payable shall be increased
as necessary so that after making all required deductions (including
deductions applicable to additional sums payable under this Section) the
Administrative Agent, any Lender or the L/C Issuer, as the case may be,
receives an amount equal to the sum it would have received had no such
deductions been made, (ii) such Borrower shall make such deductions and (iii)
such Borrower shall timely pay the full amount deducted to the relevant
Governmental Authority in accordance with applicable Law.
(b) Payment of Other Taxes by the Borrowers. Without limiting the
provisions of subsection (a) above, the Borrowers shall timely pay any Other
Taxes to the relevant Governmental Authority in accordance with applicable
law.
(c) Indemnification by the Borrowers. Each of the Borrowers shall
indemnify the Administrative Agent, each Lender and the L/C Issuer, within 30
days after written demand therefor, for the full amount of any Indemnified
Taxes or Other Taxes (including Indemnified Taxes or Other Taxes imposed or
asserted on or attributable to amounts payable under this Section) paid by the
Administrative Agent, such Lender or the L/C Issuer, as the case may be, and
any penalties, interest and reasonable expenses arising therefrom or with
respect thereto (provided that such penalties, interests and expenses are not
attributable to the gross negligence or willful misconduct of the
Administrative Agent, any Lender, or the L/C Issuer), whether or not such
Indemnified Taxes or Other Taxes were correctly or legally imposed or asserted
by the relevant Governmental Authority. A certificate as to the amount of such
payment, setting forth in reasonable detail the calculation and basis for such
amount, delivered to a Borrower by a Lender or the L/C Issuer (with a copy to
the Administrative Agent), or by the Administrative Agent on its own behalf or
on behalf of a Lender or the L/C Issuer, shall be conclusive absent manifest
error.
(d) Change in Place of Organization. The Borrowers shall not be
required pursuant to this Section 3.01 to pay any additional amount to, or to
indemnify, the Administrative Agent, any Lender, or the L/C Issuer, as the
case may be, to the extent such Administrative Agent, Lender, or L/C Issuer
becomes subject to Taxes subsequent to the date on which such Administrative
Agent, Lender, or L/C Issuer becomes a party to this Agreement as a result of
a change in the place of organization of such Administrative Agent, Lender, or
L/C Issuer, except to the extent that any such change is requested or required
by a Borrower (and provided, that nothing in this clause (d) shall be
construed as relieving the Borrowers from any obligation to make such payments
or indemnification in the event of a Change in Law, including a Change in Law
after the date of such change of place of organization).
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(e) Evidence of Payments. As soon as practicable after any payment of
Indemnified Taxes or Other Taxes by a Borrower to a Governmental Authority,
such Borrower shall deliver to the Administrative Agent the original or a
certified copy of a receipt issued by such Governmental Authority evidencing
such payment, a copy of the return reporting such payment or other evidence of
such payment reasonably satisfactory to the Administrative Agent.
(f) Status of Lenders. Any Foreign Lender or any UK Lender that is
entitled to an exemption from or reduction of withholding tax under the law of
the jurisdiction in which the relevant Borrower with respect to that Foreign
Lender or UK Lender is resident for tax purposes, or any treaty to which such
jurisdiction is a party, with respect to payments hereunder or under any other
Loan Document shall deliver to such Borrower or the relevant Governmental
Authority (with a copy to the Administrative Agent), at the time or times
prescribed by applicable law or reasonably requested by such Borrower or the
Administrative Agent, such properly completed and executed documentation
prescribed by applicable law as will permit such payments to be made without
withholding or at a reduced rate of withholding. In addition, any Lender, if
requested by a Borrower or the Administrative Agent, shall deliver such other
documentation prescribed by applicable law or reasonably requested by such
Borrower or the Administrative Agent as will enable such Borrower or the
Administrative Agent to determine whether or not such Lender is subject to
withholding or information reporting requirements.
Without limiting the generality of the foregoing, if a Borrower is resident for
tax purposes in the United States, (i) any Foreign Lender shall deliver to such
Borrower and the Administrative Agent, or to such Persons as they may
reasonably designate, (in such number of copies as shall be requested by the
recipient) on or prior to the date on which such Foreign Lender becomes a
Lender under this Agreement (and from time to time thereafter upon the request
of such Borrower or the Administrative Agent, but only if such Foreign Lender
is legally entitled to do so), whichever of the following is applicable:
(A) duly completed originals of Internal Revenue Service Form
W-8BEN claiming eligibility for benefits of an income tax treaty to
which the United States is a party,
(B) duly completed originals of Internal Revenue Service Form
W-8ECI,
(C) in the case of a Foreign Lender claiming the benefits of
the exemption for portfolio interest under section 881(c) of the Code,
(A) a certificate to the effect that such Foreign Lender is not (1) a
"bank" within the meaning of section 881(c)(3)(A) of the Code, (2) a
"10 percent shareholder" of such Borrower within the meaning of
section 881(c)(3)(B) of the Code, or (3) a "controlled foreign
corporation" described in section 881(c)(3)(C) of the Code and (B)
duly completed originals of Internal Revenue Service Form W-8BEN, or
(D) any other form prescribed by applicable law as a basis for
claiming exemption from or reduction in United States Federal
withholding tax (including any successor form to those referenced in
Sections 3.01(f)(i)-(iii) duly completed together with such
supplementary documentation as may be prescribed by
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applicable law to permit such Borrower to determine the withholding or
deduction required to be made, or
(ii) any Lender that is not a Foreign Lender shall deliver to such
Borrower and the Administrative Agent (in such number of copies as shall
be requested by the recipient) on or prior to the date on which such
Lender becomes a Lender under this Agreement (and from time to time
thereafter upon the request of such Borrower or the Administrative Agent)
a duly completed Internal Revenue Service Form W-9 (or successor form
thereto).
(g) Treatment of Certain Refunds. If the Administrative Agent, any
Lender, or L/C Issuer becomes aware that it is entitled to claim a refund from
a Governmental Authority in respect of Indemnified Taxes or Other Taxes paid by
a Borrower pursuant to this Section 3.01, such Administrative Agent, Lender or
L/C Issuer, as the case may be, shall promptly notify the Borrower of the
availability of such refund claim and, within 30 days after receipt of a
request by a Borrower, make a claim to such Governmental Authority for such
refund. If the Administrative Agent, any Lender or the L/C Issuer receives a
refund of any Taxes or Other Taxes as to which it has been indemnified by a
Borrower or with respect to which a Borrower has paid additional amounts
pursuant to this Section, it shall pay to such Borrower an amount equal to such
refund (but only to the extent of indemnity payments made, or additional
amounts paid, by such Borrower under this Section with respect to the Taxes or
Other Taxes giving rise to such refund), net of all out-of-pocket expenses of
the Administrative Agent, such Lender or the L/C Issuer, as the case may be,
and without interest (other than any interest paid by the relevant Governmental
Authority with respect to such refund), provided that each Borrower, upon the
request of the Administrative Agent, such Lender or the L/C Issuer, agrees to
repay the amount paid over to such Borrower (plus any penalties, interest or
other charges imposed by the relevant Governmental Authority) to the
Administrative Agent, such Lender or the L/C Issuer in the event the
Administrative Agent, such Lender or the L/C Issuer is required to repay such
refund to such Governmental Authority. This subsection shall not be construed
to require the Administrative Agent, any Lender or the L/C Issuer to make
available its tax returns (or any other information relating to its taxes that
it reasonably deems confidential) to the Borrowers or any other Person.
(h) UK Lenders. A Borrower is not required to pay additional amounts
to a Lender (other than an assignee pursuant to a request by a Borrower under
Section 10.14) pursuant to Section 3.01(a) in respect of any Indemnified Tax
that is required by the United Kingdom to be withheld from a payment of
interest on a loan made to a Borrower incorporated in the United Kingdom if at
the time that that withholding is made: (i) the relevant Lender is not a UK
Lender and that Indemnified Tax would not have been required to be withheld
had that Lender been a UK Lender unless the reason that that Lender is not a
UK Lender is a change after the date on which it became a Lender under this
Agreement in (or in the interpretation, administration or application of) any
law or double taxation agreement or any published practice or published
concession of any relevant Tax authority; or (ii) the relevant Lender is a
Treaty Lender and the relevant Borrower is able to demonstrate that that
Indemnified Tax is required to be withheld as a result of the failure of the
relevant Lender to comply with its obligations under Section 3.01(f).
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3.02 Illegality.
If any Lender determines in good faith that any Law has made it
unlawful, or that any Governmental Authority has asserted that it is unlawful,
for any Lender or its applicable Lending Office to make, maintain or fund
Eurocurrency Rate Loans in dollars or any Foreign Currency, or to determine or
charge interest rates based upon the Eurocurrency Rate, or any Governmental
Authority has imposed material restrictions on the authority of such Lender to
purchase or sell, or to take deposits of, Dollars or any Foreign Currency in
the London interbank market, then, on notice thereof by such Lender to the U.S.
Borrower through the Administrative Agent, any obligation of such Lender to
make or continue Eurocurrency Rate Loans or to convert Base Rate Loans to
Eurocurrency Rate Loans shall be suspended until such Lender notifies the
Administrative Agent and the U.S. Borrower that the circumstances giving rise
to such determination no longer exist. Upon receipt of such notice, the U.S.
Borrower shall, upon demand from such Lender (with a copy to the Administrative
Agent), (a) with respect to Loans denominated in Dollars, prepay or, if
applicable, convert all Eurocurrency Rate Loans of such Lender to Base Rate
Loans and (b) with respect to Loans denominated in a Foreign Currency, exchange
all such Loans into the Equivalent thereof in Dollars and convert such Loans to
Base Rate Loans, in each case either on the last day of the Interest Period
therefor, if such Lender may lawfully continue to maintain such Eurocurrency
Rate Loans to such day, or immediately, if such Lender may not lawfully
continue to maintain such Eurocurrency Rate Loans. Upon any such prepayment or
conversion, the U.S. Borrower shall also pay accrued interest on the amount so
prepaid or converted and amounts due pursuant to Section 3.05, if any.
3.03 Inability to Determine Rates.
If the Required Lenders determine that for any reason in connection
with any request for a Eurocurrency Rate Loan or a conversion to or
continuation thereof that (a) deposits in Dollars or the applicable Foreign
Currency are not being offered to banks in the London interbank eurocurrency
market for the applicable amount and Interest Period of such Eurocurrency Rate
Loan, (b) adequate and reasonable means do not exist for determining the
Eurocurrency Rate for any requested Interest Period with respect to a proposed
Eurocurrency Rate Loan, or (c) the Eurocurrency Rate for any requested Interest
Period with respect to a proposed Eurocurrency Rate Loan does not adequately
and fairly reflect the cost to such Lenders of funding such Loan, the
Administrative Agent will promptly so notify the Borrowers and each Lender.
Thereafter, the obligation of the Lenders to make or maintain Eurocurrency Rate
Loans shall be suspended until the Administrative Agent (upon the instruction
of the Required Lenders) revokes such notice. Upon receipt of such notice, the
applicable Borrower may revoke any pending request for a Borrowing of,
conversion to or continuation of Eurocurrency Rate Loans or, failing that, (x)
in the case of requests for Borrowings in Dollars, will be deemed to have
converted such request into a request for a Borrowing of Base Rate Loans in the
amount specified therein and (y) in the case of requests for Borrowings in any
Foreign Currency, will be deemed to have revoked such request.
3.04 Increased Costs; Reserves on Eurocurrency Rate Loans.
(a) Increased Costs Generally. If any Change in Law shall:
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(i) impose, modify or deem applicable any reserve, special deposit,
compulsory loan, insurance charge or similar requirement against assets
of, deposits with or for the account of, or credit extended or
participated in by, any Lender;
(ii) subject any Lender or the L/C Issuer to any tax of any kind
whatsoever with respect to this Agreement, any Letter of Credit, any
participation in a Letter of Credit or any Eurocurrency Rate Loan made by
it, or change the basis of taxation of payments to such Lender or the L/C
Issuer in respect thereof (except for Indemnified Taxes or Other Taxes
covered by Section 3.01 and any Excluded Tax); or
(iii) impose on any Lender or the L/C Issuer or the London interbank
market any other condition, cost or expense affecting this Agreement or
Eurocurrency Rate Loans made by such Lender or any Letter of Credit or
participation therein;
and the result of any of the foregoing shall be to increase the cost to such
Lender of making or maintaining any Eurocurrency Rate Loan (or of maintaining
its obligation to make any such Loan), or to increase the cost to such Lender
or the L/C Issuer of participating in, issuing or maintaining any Letter of
Credit (or of maintaining its obligation to participate in or to issue any
Letter of Credit), or to reduce the amount of any sum received or receivable by
such Lender or the L/C Issuer hereunder (whether of principal, interest or any
other amount) then, upon request of such Lender or the L/C Issuer, the
Borrowers will pay to such Lender or the L/C Issuer, as the case may be, such
additional amount or amounts as will compensate such Lender or the L/C Issuer,
as the case may be, for such additional costs incurred or reduction suffered.
(b) Capital Requirements. If any Lender or the L/C Issuer determines
that any Change in Law affecting such Lender or the L/C Issuer or any Lending
Office of such Lender or such Lender's or the L/C Issuer's holding company, if
any, regarding capital requirements has or would have the effect of reducing
the rate of return on such Lender's or the L/C Issuer's capital or on the
capital of such Lender's or the L/C Issuer's holding company, if any, as a
consequence of this Agreement, the Commitments of such Lender or the Loans
made by, or participations in Letters of Credit held by, such Lender, or the
Letters of Credit issued by the L/C Issuer, to a level below that which such
Lender or the L/C Issuer or such Lender's or the L/C Issuer's holding company
could have achieved but for such Change in Law (taking into consideration such
Lender's or the L/C Issuer's policies and the policies of such Lender's or the
L/C Issuer's holding company with respect to capital adequacy), then from time
to time the Borrowers will pay to such Lender or the L/C Issuer, as the case
may be, such additional amount or amounts as will compensate such Lender or
the L/C Issuer or such Lender's or the L/C Issuer's holding company for any
such reduction suffered.
(c) Certificates for Reimbursement. A certificate of a Lender or the
L/C Issuer setting forth the amount or amounts necessary to compensate such
Lender or the L/C Issuer or its holding company, as the case may be (which
certificate shall set forth in reasonable detail the basis for and calculation
thereof), as specified in subsection (a) or (b) of this Section and delivered
to the U.S. Borrower shall be conclusive absent manifest error. The Borrowers
shall pay such Lender or the L/C Issuer, as the case may be, the amount shown
as due on any such certificate within 10 days after receipt thereof.
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(d) Delay in Requests. Failure or delay on the part of any Lender or
the L/C Issuer to demand compensation pursuant to the foregoing provisions of
this Section shall not constitute a waiver of such Lender's or the L/C
Issuer's right to demand such compensation, provided that the Borrowers shall
not be required to compensate a Lender or the L/C Issuer pursuant to the
foregoing provisions of this Section for any increased costs incurred or
reductions suffered more than nine months prior to the date that such Lender
or the L/C Issuer, as the case may be, notifies the U.S. Borrower of the
Change in Law giving rise to such increased costs or reductions and of such
Lender's or the L/C Issuer's intention to claim compensation therefor (except
that, if the Change in Law giving rise to such increased costs or reductions
is retroactive, then the nine-month period referred to above shall be extended
to include the period of retroactive effect thereof).
3.05 Compensation for Losses. Upon written demand of any Lender (with
a copy to the Administrative Agent) from time to time, the Borrowers shall
promptly compensate such Lender for and hold such Lender harmless from any
loss, cost or expense incurred by it as a result of:
(a) any continuation, conversion, payment or prepayment of any Loan
other than a Base Rate Loan on a day other than the last day of the
Interest Period for such Loan (whether voluntary, mandatory, automatic,
by reason of acceleration, or otherwise);
(b) any failure by any Borrower (for a reason other than the failure
of such Lender to make a Loan) to prepay, borrow, continue or convert any
Loan other than a Base Rate Loan on the date or in the amount notified by
such Borrower; or
(c) any assignment of a Eurocurrency Rate Loan on a day other than
the last day of the Interest Period therefor as a result of a request by
a Borrower pursuant to Section 10.14;
excluding any loss of anticipated profits, but including any loss or expense
arising from the liquidation or reemployment of funds obtained by it to
maintain such Loan or from fees payable to terminate the deposits from which
such funds were obtained. The Borrowers shall also pay any customary
administrative fees charged by such Lender in connection with the foregoing.
For purposes of calculating amounts payable by the Borrowers to the Lenders
under this Section 3.05, each Lender shall be deemed to have funded each
Eurocurrency Rate Loan made by it at the Eurocurrency Base Rate used in
determining the Eurocurrency Rate for such Loan by a matching deposit or other
borrowing in the London interbank eurocurrency market for a comparable amount
and for a comparable period, whether or not such Eurocurrency Rate Loan was in
fact so funded.
3.06 Mitigation Obligations; Replacement of Lenders.
(a) Designation of a Different Lending Office. If any Lender requests
compensation under Section 3.04, or a Borrower is required to pay, or
delivers to such Lender and the Administrative Agent a certificate
setting forth reasons it reasonably anticipates that it will be required
to pay, any additional amount to any Lender or any Governmental Authority
for the account of any Lender pursuant to Section 3.01, or if any Lender
gives a notice pursuant to
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Section 3.02, then such Lender shall use reasonable efforts to designate a
different Lending Office for funding or booking its Loans hereunder or to
assign its rights and obligations hereunder to another of its offices,
branches or affiliates, if, in the judgment of such Lender, such
designation or assignment (i) would eliminate or reduce amounts payable
pursuant to Section 3.01 or 3.04, as the case may be, in the future, or
eliminate the need for the notice pursuant to Section 3.02, as applicable,
and (ii) in each case, would not subject such Lender to any unreimbursed
cost or expense and would not otherwise be disadvantageous to such Lender.
Each Borrower hereby agrees to pay all reasonable costs and expenses
incurred by any Lender in connection with any such designation or
assignment.
(b) Replacement of Lenders. If any Lender requests compensation under
Section 3.04, or if any Borrower is required to pay any additional amount to
any Lender or any Governmental Authority for the account of any Lender
pursuant to Section 3.01, the U.S. Borrower may replace such Lender in
accordance with Section 10.14.
3.07 Survival. All of the Borrowers' and Lenders' obligations under
this Article III shall survive termination of the Aggregate Commitments and
repayment of all other Obligations hereunder.
ARTICLE IV
CONDITIONS PRECEDENT TO Credit Extensions
4.01 Conditions of Initial Credit Extension. The obligation of the
L/C Issuer and each Lender to make its initial Credit Extension hereunder is
subject to satisfaction of the following conditions precedent:
(a) The Administrative Agent's receipt of the following, each of
which shall be originals or telecopies (followed promptly by originals)
unless otherwise specified, each properly executed by a Responsible
Officer of the signing Loan Party, each dated the Closing Date (or, in
the case of certificates of governmental officials, a recent date before
the Closing Date) and each in form and substance satisfactory to the
Administrative Agent and each of the Lenders:
(i) executed counterparts of this Agreement, the ROV Guaranty,
the KGaA Guaranty and the UK Guaranty, sufficient in number for
distribution to the Administrative Agent, each Lender and the
Borrowers;
(ii) Notes executed by each of the Borrowers in favor of each
Lender requesting a Note;
(iii) a security agreement, in substantially the form of Exhibit
G (together with each other security agreement and security agreement
supplement delivered pursuant to Section 6.12, in each case as
amended, the "Security Agreement"), duly executed by each Loan Party,
together with:
(A) certificates representing the Pledged Equity referred
to therein accompanied by undated stock powers executed in blank
and instruments evidencing the Pledged Debt indorsed in blank,
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(B) proper financing statements, in form appropriate for
filing under the Uniform Commercial Code of all jurisdictions
that the Administrative Agent may deem necessary or desirable in
order to perfect the Liens created under the Security Agreement,
covering the Collateral described in the Security Agreement,
(C) completed requests for information, dated on or before
the date of the initial Credit Extension, listing all effective
financing statements filed in the jurisdictions referred to in
clause (B) above that name any Loan Party as debtor, together
with copies of such other financing statements,
(D) evidence of the completion of all other actions,
recordings and filings of or with respect to the Security
Agreement that the Administrative Agent may deem necessary or
desirable in order to perfect and protect the Liens created
thereby, and
(E) evidence of the insurance required by the terms of the
Security Agreement.
(iv) an intellectual property security agreement, in
substantially the form attached to the Security Agreement (together
with each other intellectual property security agreement and
intellectual property security agreement supplement delivered pursuant
to Section 6.12, in each case as amended, the "Intellectual Property
Security Agreement"), duly executed by each Loan Party, together with
evidence that all actions that the Administrative Agent may deem
necessary or desirable in order to perfect the Liens created under the
Intellectual Property Security Agreement have been taken;
(v) such certificates of resolutions or other action,
incumbency certificates and/or other certificates of Responsible
Officers of each Loan Party as the Administrative Agent may require
evidencing the identity, authority and capacity of each Responsible
Officer thereof authorized to act as a Responsible Officer in
connection with this Agreement and the other Loan Documents to which
such Loan Party is a party or is to be a party;
(vi) such documents and certifications as the Administrative
Agent may reasonably require to evidence that each Loan Party is duly
organized or formed, and that each of the Borrowers and each Loan
Party is validly existing, in good standing and qualified to engage in
business in each jurisdiction where its ownership, lease or operation
of properties or the conduct of its business requires such
qualification, except to the extent that failure to do so could not
reasonably be expected to have a Material Adverse Effect;
(vii) a favorable opinion of Skadden, Arps, Slate, Meagher &
Flom LLP counsel to the Loan Parties, addressed to the Administrative
Agent and each Lender, as to the matters set forth in Exhibit I-1 and
such other matters
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concerning the Loan Parties and the Loan Documents as the Required
Lenders may reasonably request;
(viii) a favorable opinion of local counsel to the Loan Parties
in each of Germany, England, Delaware, California, Missouri, Wisconsin
and Hawaii, addressed to the Administrative Agent and each Lender, as
to the matters set forth in Exhibit I-2 and such other matters
concerning the Loan Parties and the Loan Documents as the Required
Lenders may reasonably request;
(ix) a favorable opinion of Weil, Gotshal & Manges, counsel for
UIC, delivered in connection with the Merger;
(x) a certificate of a Responsible Officer of each Loan Party
either (A) attaching copies of all material consents, licenses and
approvals required in connection with the execution, delivery and
performance by such Loan Party and the validity against such Loan
Party of the Loan Documents to which it is a party, and such consents,
licenses and approvals shall be in full force and effect, or (B)
stating that no such consents, licenses or approvals are so required
and a certificate of a director of the UK Borrower that the Borrowings
to be made by it hereunder will not breach any borrowing, guarantee,
security or other limit binding on the UK Borrower;
(xi) a certificate signed by a Responsible Officer of the U.S.
Borrower certifying that the conditions specified in Sections 4.02(a)
and (b) have been satisfied;
(xii) certificates and letters attesting to the Solvency of each
Loan Party before and after giving effect to the Transaction (and the
incurrence of Indebtedness related thereto), from its Chief Financial
Officer;
(xiii) pro forma consolidated financial statements as to the
U.S. Borrower and its Subsidiaries that (1) meet the requirements of
Regulation S-X under the Securities Act of 1933, as amended, and all
other accounting rules and regulations of the SEC promulgated
thereunder applicable to a registration statement under such Act on
Form S-1 (including the inclusion of footnote disclosure) (2) are not
materially inconsistent with the Audited Financial Statements and (3)
do not contain or disclose any new facts or information that are
material and adverse to the Lenders and forecasts prepared by
management of the U.S. Borrower, in form and substance satisfactory to
the Arrangers, of balance sheets, income statements and cash flow
statements on a quarterly basis for the first year following the day
of the initial Credit Extension and on an annual basis for each year
thereafter until the Maturity Date for the Term Facilities, which
shall state the assumptions on the basis of which such forecasts shall
have been prepared, it being understood that actual results may vary
from such forecasts and such variations may be material;
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(xiv) certified copies of each of the Related Documents, duly
executed by the parties thereto and with no amendments, supplements or
waivers thereto since January 3, 2005 in any manner adverse to the
Lenders, together with all agreements, instruments and other documents
delivered in connection therewith as the Administrative Agent shall
reasonably request;
(xv) certified copies of a certificate of merger or other
confirmation reasonably satisfactory to the Lenders of the
consummation of the Merger from the Secretary of State of the State of
Delaware;
(xvi) a Notice of Borrowing or Notice of Issuance, as
applicable, relating to the initial Credit Extension;
(xvii) (A) evidence that all of the outstanding "Loans" as
defined in the Existing Rayovac Credit Agreement have been purchased
by the Lenders hereunder, (B) evidence that the Existing UIC Credit
Agreement has been or concurrently with the Closing Date is being
terminated and all Liens securing obligations under the Existing UIC
Credit Agreement have been or concurrently with the Closing Date are
being released, (C) evidence that the U.S. Borrower has accepted for
payment and paid for all UIC Notes tendered in the tender offer and
consent solicitation conducted with respect to the UIC Notes prior to
the Closing Date and (D) UIC shall have mailed or caused to be mailed,
by first class mail, their irrevocable notice of redemption to each
holder of UIC Notes in accordance with the provisions of Article III
of the Indenture dated March 27, 2003, among UIC, the Guarantors (as
defined therein) and U.S. Bank National Association, as Trustee, and
shall state that the redemption date for the UIC Notes, shall be 30
days from the date such notice is mailed; and
(xviii) such other assurances, certificates, documents, consents
or opinions as the Administrative Agent, the L/C Issuer, the Swing
Line Lender or any Lender reasonably may require.
(b) All fees required to be paid to the Administrative Agent, the
Joint Book Managers and the Lenders on or before the Closing Date shall have
been paid.
(c) Unless waived by the Administrative Agent, the Borrowers shall
have paid all reasonable out-of-pocket fees, charges and disbursements of
counsel to the Administrative Agent to the extent invoiced prior to or on the
Closing Date, plus such additional amounts of such fees, charges and
disbursements as shall constitute its reasonable estimate of such fees,
charges and disbursements incurred or to be incurred by it through the closing
proceedings (provided that such estimate shall not thereafter preclude a final
settling of accounts between the U.S. Borrower and the Administrative Agent).
(d) There shall exist no action, suit, investigation, litigation or
proceeding affecting any Loan Party or any of its Subsidiaries pending or, to
the knowledge of any of the Borrowers, threatened, before any Governmental
Authority or arbitrator that (i) could be reasonably likely to have a Material
Adverse Effect or (ii) could be reasonably likely to have a
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material adverse effect on the operations, business, assets or condition
(financial or otherwise) of UIC and its Subsidiaries, taken as a whole.
(e) All material governmental authorizations and all third party
consents and approvals necessary in connection with the Transaction shall have
been obtained (without the imposition of any conditions that are not
acceptable to the Lenders) and shall remain in effect; all applicable waiting
periods in connection with the Transaction shall have expired without any
action being taken by any Governmental Authority that restrains, prevents or
imposes materially adverse conditions upon the Transaction or the rights of
the Loan Parties or their Subsidiaries freely to transfer or otherwise dispose
of, or to create any Lien on, any properties now owned or hereafter acquired
by any of them.
(f) All of the written information that was made available to the
Administrative Agent by or on behalf of any of the Loan Parties prior to
January 3, 2005 shall be complete and correct in all material respects and no
new or additional information shall have been received or discovered after
January 3, 2005 that is inconsistent with such information and either
individually or in the aggregate, could reasonably be expected to have a
Material Adverse Effect.
(g) The Merger shall have been consummated in accordance with the
terms of the Merger Agreement, without any waiver or amendment of any term,
provision or condition set forth therein adverse to the Lenders and not
consented to by the Arrangers.
Without limiting the generality of the provisions of Section 9.05, for purposes
of determining compliance with the conditions specified in this Section 4.01,
each Lender that has signed this Agreement shall be deemed to have consented
to, approved or accepted or to be satisfied with, each document or other matter
required thereunder to be consented to or approved by or acceptable or
satisfactory to a Lender unless the Administrative Agent shall have received
notice from such Lender prior to the proposed Closing Date specifying its
objection thereto.
4.02 Conditions to all Credit Extensions. The obligation of each
Lender to honor any Request for Credit Extension (other than a Committed Loan
Notice requesting only a conversion of Loans denominated in Dollars to the
other Type, or a continuation of Eurocurrency Rate Loans) is subject to the
following conditions precedent:
(a) The representations and warranties of the Borrowers and each
other Loan Party contained in Article V or any other Loan Document, or
which are contained in any document furnished at any time under or in
connection herewith or therewith, shall be true and correct in all
material respects on and as of the date of such Credit Extension (other
than, with respect to Credit Extensions made on the Closing Date, the
representation in Section 5.05(c)), except to the extent that such
representations and warranties specifically refer to an earlier date, in
which case they shall be true and correct in all material respects as of
such earlier date, and except that for purposes of this Section 4.02, the
representations and warranties contained in Sections 5.05(a) and (b)
shall be deemed to refer to the most recent statements furnished pursuant
to Sections 6.01(a) and (b), respectively.
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(b) No Default shall exist, or would result from such proposed Credit
Extension or from the application of the proceeds therefrom.
(c) The Administrative Agent and, if applicable, the L/C Issuer or
the Swing Line Lender shall have received a Request for Credit Extension
in accordance with the requirements hereof.
Each Request for Credit Extension (other than a Committed Loan Notice
requesting only a conversion of Loans denominated in Dollars to the other Type
or a continuation of Eurocurrency Rate Loans) submitted by a Borrower shall be
deemed to be a representation and warranty that the conditions specified in
Sections 4.02(a) and (b) have been satisfied on and as of the date of the
applicable Credit Extension.
ARTICLE V
REPRESENTATIONS AND WARRANTIES
Each of the Borrowers represents and warrants to the Administrative
Agent and the Lenders that:
5.01 Existence, Qualification and Power; Compliance with Laws. Each
Loan Party and each of its Subsidiaries (other than Dormant Subsidiaries) (a)
is duly organized or formed and validly existing under the Laws of the
jurisdiction of its incorporation or organization, (b) has all requisite power
and authority and all requisite governmental licenses, authorizations
(including good standing), consents and approvals to (i) own or lease its
assets and carry on its business and (ii) execute, deliver and perform its
obligations under the Loan Documents to which it is a party and consummate the
Transaction, (c) is duly qualified and is licensed and in good standing under
the Laws of each jurisdiction where its ownership, lease or operation of
properties or the conduct of its business requires such qualification or
license, and (d) is in compliance with all Laws and licenses, authorizations
and permits of Governmental Authorities in favor of such Loan Party; except in
each case referred to in clause (b)(i), (c) or (d), to the extent that failure
to do so could not reasonably be expected to have a Material Adverse Effect.
5.02 Authorization; No Contravention. The execution, delivery and
performance by each Loan Party of each Loan Document and the Merger Agreement
to which such Loan Party is or is to be a party are within such Loan Party's
corporate or other powers, have been duly authorized by all necessary
corporate or other organizational action, and do not and will not, except to
the extent that such breach, contravention or conflict could not reasonably be
expected to have a Material Adverse Effect (a) contravene the terms of any of
such Loan Party's Organization Documents; (b) conflict with or result in any
breach or contravention of, or the creation of any Lien (other than Permitted
Liens) under, or require any payment to be made under (i) any Contractual
Obligation to which such Loan Party is a party or, to such Loan Party's
knowledge, affecting such Loan Party or the properties of such Loan Party or
any of its Subsidiaries or (ii) any order, injunction, writ or decree of any
Governmental Authority or any arbitral award to which such Loan Party or its
property is subject; or (c) violate any Law or any license, authorization or
permit of a Governmental Authority reasonably necessarily in the conduct of
such Subsidiary's business. Each Loan Party and each Subsidiary thereof is in
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compliance with all Contractual Obligations referred to in clause (b)(i),
except to the extent that failure to do so could not reasonably be expected to
have a Material Adverse Effect.
5.03 Governmental Authorization; Other Consents. No approval,
consent, exemption, authorization, or other action by, or notice to, or filing
with, any Governmental Authority or any other Person is necessary or required
in connection with (a) the execution, delivery or performance by, or
enforcement against, any Loan Party of this Agreement or any other Loan
Document or the Merger Agreement, or for the consummation of the Transaction,
except those approvals, consents, exemption, authorization or other actions
the failure of which to obtain or take could not reasonably be expected to
have a Material Adverse Effect, (b) the grant by any Loan Party of the Liens
granted by it pursuant to the Collateral Documents, (c) the perfection or
maintenance of the Liens created under the Collateral Documents other than UCC
filings and other filings specifically contemplated by the Collateral
Documents (including the priority thereof) or (d) the exercise by the
Administrative Agent or any Lender of its rights under the Loan Documents or
the remedies in respect of the Collateral pursuant to the Collateral Documents
except for (i) filings necessary to perfect the Liens on the Collateral
granted by the Loan Parties in favor of the Secured Parties and (ii)
approvals, consents, exemptions, authorizations, deletions, notices and
filings that (A) have been duly obtained, taken, given or made and are in full
force and effect or (B) the failure of which to obtain or take could not
reasonably be expected to have a Material Adverse Effect.
5.04 Binding Effect. This Agreement has been, and each other Loan
Document, when delivered hereunder, will have been, duly executed and
delivered by each Loan Party that is party thereto. This Agreement
constitutes, and each other Loan Document when so delivered will constitute, a
legal, valid and binding obligation of such Loan Party, enforceable against
each Loan Party that is party thereto in accordance with its terms, except to
the extent such enforceability may be limited by the effect of applicable
bankruptcy, insolvency or similar laws affecting the enforcement of creditors'
rights generally and by equitable principles relating to enforceability.
5.05 Financial Statements; No Material Adverse Effect.
(a) The Audited Financial Statements (i) were prepared in accordance
with GAAP consistently applied throughout the period covered thereby, except
as otherwise expressly noted therein; (ii) in all material respects fairly
present the financial condition of each of the U.S. Borrower and its
Subsidiaries and UIC and its Subsidiaries, respectively, as of the date
thereof and their results of operations for the period covered thereby; and
(iii) show all material indebtedness and other liabilities, direct or
contingent, of the U.S. Borrower and its Subsidiaries and UIC and its
Subsidiaries, respectively, as of the date thereof, including liabilities for
taxes, material commitments and Indebtedness.
(b) The unaudited consolidated balance sheet of UIC and its
Subsidiaries dated September 30, 2004 and the related consolidated statements
of income or operations, shareholders' equity and cash flows for the fiscal
quarters ended on such dates (i) were prepared in accordance with GAAP
consistently applied throughout the period covered thereby, except as
otherwise expressly noted therein, and (ii) fairly present in all material
respects the financial condition of UIC and its Subsidiaries as of the date
thereof and their results of operations for the
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period covered thereby, subject, in the case of clauses (i) and (ii), to the
absence of footnotes and to normal year-end audit adjustments. Schedule 5.05
sets forth all material indebtedness and other liabilities, direct or
contingent, of UIC and its consolidated Subsidiaries as of the date of such
financial statements, including liabilities for taxes, material commitments and
Indebtedness.
(c) Since the date of the Audited Financial Statements, there has
been no event or circumstance, either individually or in the aggregate, that
has had or could reasonably be expected to have a Material Adverse Effect.
(d) The consolidated pro forma balance sheet of the U.S. Borrower and
its Subsidiaries as at September 30, 2004, and the related consolidated pro
forma statements of income and cash flows of the U.S. Borrower and its
Subsidiaries for the fiscal year then ended, certified by the chief financial
officer or treasurer of the U.S. Borrower, copies of which have been furnished
to each Lender, fairly present in all material respects the consolidated pro
forma financial condition of the U.S. Borrower and its Subsidiaries as at such
date and the consolidated pro forma results of operations of the U.S. Borrower
and its Subsidiaries for the period ended on such date, in each case giving
effect to the Transaction, all in accordance with GAAP.
(e) The consolidated forecasted balance sheets, statements of income
and statements of cash flows of the U.S. Borrower and its Subsidiaries
delivered to the Lenders pursuant to Section 4.01 or 6.01(c) were prepared in
good faith on the basis of the reasonable assumptions at the time made stated
therein, which assumptions were fair in light of the conditions existing at
the time of delivery of such forecasts, it being understood that (i) such
forecasts, as to future events, are not to be viewed as facts, that actual
results during the period or periods covered by any such forecasts may differ
significantly from the forecasted results and that such differences may be
material and that such forecasts are not a guarantee of financial performance
and (ii) no representation is made with respect to information of a general
economic or general industry nature.
5.06 Litigation. Except as disclosed on Schedule 5.06, there are no
actions, suits, proceedings, claims or disputes pending or, to the knowledge of
the Borrowers, threatened or contemplated, at law, in equity, in arbitration or
before any Governmental Authority, by or against the Borrowers or any of their
Subsidiaries or against any of their properties or revenues that either
individually or in the aggregate could reasonably be expected to have a
Material Adverse Effect.
5.07 No Default. None of the Borrowers or any Subsidiary is in
default under or with respect to, or a party to, any Contractual Obligation
that could, either individually or in the aggregate, reasonably be expected to
have a Material Adverse Effect.
5.08 Ownership of Property.
(a) Each Loan Party has good record, indefeasible and insurable title
in fee simple to, or valid leasehold interests in, all real property necessary
or used in the ordinary conduct of its business, except where failure to have
such title or other property interests could not, individually or in the
aggregate, reasonably be expected to have a Material Adverse Effect.
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(b) Schedule 5.08(b) sets forth a complete and accurate list of all
real property owned by each Loan Party, which, as of the Closing Date, has an
estimated fair value greater than $5,000,000 or as to which a Mortgage will be
granted hereunder, in each case showing as of the date hereof the street
address, county or other relevant jurisdiction, state, record owner and
estimated fair value thereof. Each Loan Party has good, indefeasible and
insurable fee simple title to the real property owned by such Loan Party, free
and clear of all Liens, other than Permitted Liens.
(c) Schedule 5.08(c) sets forth a complete and accurate list of all
material leases of real property subject to a leasehold mortgage as of the
Closing Date or as to which a Mortgage will be granted hereunder under which
any Loan Party is the lessee, showing as of the date hereof the street
address, county or other relevant jurisdiction, state, lessor, lessee and
expiration date thereof. Each such lease is the legal, valid and binding
obligation of the lessor (assuming corporate power and authority and due
execution and delivery on the part of the lessor with respect to such lease)
thereof, enforceable in accordance with its terms.
5.09 Environmental Compliance.
(a) The facilities and properties owned or leased by the Loan Parties
and their respective Subsidiaries are in compliance with all Environmental
Laws, except for such non-compliance as would not reasonably be expected to
result in a Material Adverse Effect.
(b) Except as otherwise set forth in Schedule 5.09, none of the
properties currently or, to the knowledge of any Borrower, formerly owned or
operated by any Loan Party or any of its Subsidiaries is listed or proposed
for listing on the NPL or on the CERCLIS or any analogous foreign, state or
local list; and, except as would not reasonably be expected to result in a
Material Adverse Effect, Hazardous Materials have not been released,
discharged or disposed of at, on or under any property currently or, to the
knowledge of the Loan Parties, formerly owned or operated by any Loan Party or
any of its Subsidiaries.
(c) Except as otherwise set forth on Schedule 5.09 or as could not
individually or in the aggregate be reasonably expected to have a Material
Adverse Effect, neither any Loan Party nor any of its Subsidiaries is
undertaking, and has not completed, either individually or together with other
potentially responsible parties, any investigation or assessment or remedial
or response action relating to any actual or threatened release, discharge or
disposal of Hazardous Materials at any site, location or operation, either
voluntarily or pursuant to the order of any Governmental Authority or the
requirements of any Environmental Law; and all Hazardous Materials generated,
used, treated, handled or stored at, or transported to or from, any property
currently or formerly owned or operated by any Loan Party or any of its
Subsidiaries have been disposed of in a manner not reasonably expected to
result in individually or in the aggregate, a Material Adverse Effect to any
Loan Party or any of its Subsidiaries.
(d) No pending or threatened claims against any Loan Party or any of
their Subsidiaries of any Government Authority or any other party arising
under any Environmental Law have been made, except for such claims that are
not reasonably likely, either singly or in the aggregate, to result in a
Material Adverse Effect.
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5.10 Insurance. The properties of the U.S. Borrower and its
Subsidiaries are insured with financially sound and reputable insurance
companies not Affiliates of the U.S. Borrower, in such amounts (after giving
effect to any self-insurance compatible with the following standards), with
such deductibles and covering such risks as are customarily carried by
companies engaged in similar businesses and owning similar properties in
localities where the U.S. Borrower or the applicable Subsidiary operates.
5.11 Taxes. The U.S. Borrower and its Subsidiaries have filed all
material Federal, state and other material tax returns and reports required to
be filed, and have paid all material Federal, state and other material taxes,
assessments, fees and other governmental charges levied or imposed upon them
or their properties, income or assets otherwise due and payable, except those
which are (a) not overdue by more than thirty (30) days, (b) being contested
in good faith by appropriate proceedings diligently conducted and for which
adequate reserves have been provided in accordance with GAAP and (c) to the
extent that the failure to make such filings individually or in the aggregate
could not reasonably be expected to have a Material Adverse Effect. There is
no proposed tax assessment against the U.S. Borrower or any Subsidiary that
would, if made, have a Material Adverse Effect. Neither any Loan Party nor any
of its Subsidiaries is party to any tax sharing agreement with any other
Person (other than the U.S. Borrower and its Subsidiaries) pursuant to which
it is liable for any Taxes of any Person that could be reasonably expected to
have a Material Adverse Effect.
5.12 ERISA Compliance.
(a) Each Plan is in compliance in all material respects with its
terms, the applicable provisions of ERISA, the Code and other federal or state
Laws. Each Plan that is intended to qualify under Section 401(a) of the Code
is so qualified, and to the knowledge of the U.S. Borrower, nothing has
occurred which could reasonably be expected to cause the loss of such
qualification. There are no pending or, to the knowledge of the Borrowers,
threatened claims, actions or lawsuits, or action by any Governmental
Authority, with respect to any Plan that could reasonably be expected to have
a Material Adverse Effect.
(b) No ERISA Event has occurred or could reasonably be expected to
occur that, either individually or in the aggregate, has had or could
reasonably be expected to have, a Material Adverse Effect. No Pension Plan has
any Unfunded Pension Liability, except as could not reasonably be expected to
have a Material Adverse Effect.
(c) With respect to each scheme or arrangement mandated by a
government other than the United States (a "Foreign Government Scheme or
Arrangement") and with respect to each employee benefit plan maintained or
contributed to by any Loan Party or any Subsidiary of any Loan Party that is
not subject to United States law (a "Foreign Plan"), except as could not
reasonably be expected to have a Material Adverse Effect:
(i) any employer and employee contributions required by law or
by the terms of any Foreign Government Scheme or Arrangement or any
Foreign Plan have been made, or, if applicable, accrued, in accordance
with normal accounting practices;
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(ii) the fair market value of the assets of each funded Foreign
Plan, the liability of each insurer for any Foreign Plan funded
through insurance or the book reserve established for any Foreign
Plan, together with any accrued contributions, is sufficient to
procure or provide for the accrued benefit obligations, as of the date
hereof, with respect to all current and former participants in such
Foreign Plan according to the actuarial assumptions and valuations
most recently used to account for such obligations in accordance with
applicable generally accepted accounting principles; and
(iii) each Foreign Plan required to be registered has been
registered and has been maintained in good standing with applicable
regulatory authorities.
5.13 Subsidiaries; Equity Interests; Loan Parties. As of the Closing
Date, the U.S. Borrower has no Subsidiaries other than those specifically
disclosed in Part (a) of Schedule 5.13, and all of the outstanding Equity
Interests in such Subsidiaries have been validly issued, are fully paid and
non-assessable and are owned by a Loan Party in the amounts specified on
Schedule 5.13 free and clear of all Liens except those permitted under Section
7.01(a), (b), (c), (h), (j), or (o). As of the Closing Date, each Loan Party
has no equity investments in any other corporation or entity other than those
specifically disclosed in Schedule 5.13, Cash Equivalents and equity
investments permitted pursuant to Section 7.03(p). All of the outstanding
Equity Interests in the U.S. Borrower and each of its Subsidiaries have been
validly issued and are fully paid and non-assessable. Set forth on Part (c) of
Schedule 5.13 is a complete and accurate list of all Loan Parties, showing as
of the Closing Date (as to each Loan Party) the jurisdiction of its
incorporation, the address of its principal place of business and its U.S.
taxpayer identification number, or, in the case of the UK Borrower, its
registered number at Companies House, or, in the case of any non-U.S. Loan
Party that does not have a U.S. taxpayer identification number, its unique
identification number issued to it by the jurisdiction of its incorporation.
The copy of the charter of each Loan Party and each amendment thereto provided
pursuant to Section 4.01(a) is a true and correct copy of each such document,
each of which is valid and in full force and effect.
5.14 Margin Regulations; Investment Company Act; Public Utility
Holding Company Act.
(a) Following the application of the proceeds of each Borrowing or
drawing under each Letter of Credit, not more than 25% of the value of the
assets (of the U.S. Borrower only, the Subsidiary Borrower only, or of the
U.S. Borrower and its Subsidiaries on a consolidated basis) subject to the
provisions of Section 7.01 or Section 7.05 or subject to any restriction
contained in any agreement or instrument between the U.S. Borrower and any
Lender or any Affiliate of any Lender or the Subsidiary Borrower and any
Lender or any Affiliate of any Lender relating to Indebtedness and within the
scope of Section 8.01(e) will be margin stock.
(b) None of the U.S. Borrower, any Person Controlling the U.S.
Borrower, or any Subsidiary (i) is a "holding company," or a "subsidiary
company" of a "holding company," or an "affiliate" of a "holding company" or
of a "subsidiary company" of a "holding company," within the meaning of the
Public Utility Holding Company Act of 1935, or (ii) is or is required to be
registered as an "investment company" under the Investment Company Act of
1940.
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5.15 Disclosure. The U.S. Borrower has disclosed to the Administrative
Agent and the Lenders all agreements, instruments and corporate or other
restrictions to which it or any of its Subsidiaries is subject, and all other
matters known to it, that, individually or in the aggregate, could reasonably
be expected to result in a Material Adverse Effect. Neither the Information
Memorandum nor any report, financial statement, certificate or other
information furnished (whether in writing or orally) by or on behalf of the
Loan Parties, taken as a whole, to the Administrative Agent or any Lender in
connection with the transactions contemplated hereby and the negotiation of
this Agreement or delivered hereunder or under any other Loan Document (in each
case as modified or supplemented by other information so furnished) contains
any material misstatement of fact or omits to state any material fact necessary
to make the statements therein, in the light of the circumstances under which
they were made, not misleading; provided that, with respect to projected
financial information, the U.S. Borrower represents only that such information
was prepared in good faith based upon assumptions believed to be reasonable at
the time, it being understood that actual results may vary from such
projections, and such variations may be material.
5.16 Intellectual Property; Licenses, Etc. The U.S. Borrower and each
of its Subsidiaries own, or possess the right to use, all of the trademarks,
service marks, trade names, copyrights, patents, patent rights, franchises,
licenses and other intellectual property rights (collectively, "IP Rights")
that are necessary for the operation of their respective businesses, without
conflict with the rights of any other Person, except to the extent that the
failure to so own or possess any such IP Rights (or any conflict pertaining
thereto) could not individually or in the aggregate, reasonably be expected to
have a Material Adverse Effect. To the knowledge of the Borrowers, no slogan or
other advertising device, product, process, method, substance, part or other
material now employed, or now contemplated to be employed, by the U.S. Borrower
or any of its Subsidiaries infringes upon any valid rights held by any other
Person except to the extent that such infringement could not, individually or
in the aggregate, reasonably be expected to have a Material Adverse Effect.
Except as specifically disclosed in Schedule 5.16, no claim or litigation
regarding any of the foregoing is pending or, to the knowledge of the
Borrowers, threatened, which, either individually or in the aggregate, could
reasonably be expected to have a Material Adverse Effect.
5.17 Solvency. Each Loan Party is, individually and together with its
Subsidiaries, Solvent.
ARTICLE VI
AFFIRMATIVE COVENANTS
So long as any Lender shall have any Commitment hereunder, any Loan or
other Obligation hereunder shall remain unpaid or unsatisfied, or any Letter of
Credit shall remain outstanding, each of the Borrowers shall, and shall (except
in the case of the covenants set forth in Sections 6.01, 6.02, 6.03 and 6.11)
cause each Subsidiary to:
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6.01 Financial Statements. Deliver to the Administrative Agent and
each Lender:
(a) as soon as available, but in any event within 80 days after the
end of each fiscal year of the U.S. Borrower (commencing with the fiscal
year ended 2004 with respect to UIC and its Subsidiaries and 2005 with
respect to the U.S. Borrower and its Subsidiaries), a consolidated balance
sheet of the U.S. Borrower and its Subsidiaries as at the end of such
fiscal year, and the related consolidated statements of income or
operations, shareholders' equity and cash flows for such fiscal year,
setting forth in each case in comparative form the figures for the
previous fiscal year, all in reasonable detail and prepared in accordance
with GAAP, such consolidated Statements to be audited and accompanied by a
report and opinion of a "big four" national accounting firm or other
Registered Public Accounting Firm of nationally recognized standing
reasonably acceptable to the Administrative Agent, which report and
opinion shall be prepared in accordance with generally accepted auditing
standards and applicable Securities Laws;
(b) as soon as available, but in any event within 45 days after the
end of each of the first three fiscal quarters of each fiscal year of the
U.S. Borrower (commencing with the fiscal quarter ended December 31, 2004
with respect to Rayovac Corporation and its Subsidiaries and with the
fiscal quarter ended March 31, 2005 with respect to the U.S. Borrower and
its Subsidiaries), a consolidated balance sheet of the U.S. Borrower and
its Subsidiaries as at the end of such fiscal quarter, and the related
consolidated statements of income or operations, shareholders' equity and
cash flows for such fiscal quarter and for the portion of the U.S.
Borrower's fiscal year then ended, setting forth in each case in
comparative form the figures for the corresponding fiscal quarter of the
previous fiscal year and the corresponding portion of the previous fiscal
year, all in reasonable detail and certified by the chief financial
officer or the treasurer of the U.S. Borrower as fairly presenting the
financial condition, results of operations, shareholders' equity and cash
flows of the U.S. Borrower and its Subsidiaries in accordance with GAAP,
subject only to normal year-end audit adjustments and the absence of
footnotes;
(c) as soon as available, but in any event at within 91 days after
the end of each fiscal year, forecasts prepared by management of the U.S.
Borrower, in form reasonably satisfactory to the Administrative Agent and
the Required Lenders, of the operating budget and cash flow budget of the
U.S. Borrower and its Subsidiaries for the succeeding fiscal year, such
projections to be accompanied by a certificate of the chief financial
officer of the U.S. Borrower to the effect that (i) such projections were
prepared by the U.S. Borrower in good faith, (ii) the U.S. Borrower has a
reasonable basis for the assumptions contained in such projections and
(iii) such projections have been prepared according to such assumptions,
it being understood that actual results may vary from such projections,
and such variations may be material.
As to any information contained in materials furnished pursuant to Section
6.02(c), the U.S. Borrower shall not be separately required to furnish such
information under Sections 6.01(a) or (b) above, but the foregoing shall not be
in derogation of the obligation of the U.S. Borrower to furnish the information
and materials described in Sections 6.01(a) and (b) above at the times
specified therein.
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6.02 Certificates; Other Information. Deliver to the Administrative
Agent and each Lender:
(a) concurrently with the delivery of the financial statements
referred to in Sections 6.01(a) and (b), a duly completed Compliance
Certificate signed by a Responsible Officer of the U.S. Borrower;
(b) promptly after any request by the Administrative Agent or any
Lender, copies of any final management letters submitted to the board of
directors (or the audit committee of the board of directors) of any Loan
Party by independent accountants;
(c) promptly after the same are available, copies of each annual
report, proxy or financial statement or other report or communication
sent to the stockholders of the U.S. Borrower, and copies of all annual,
regular, periodic and special reports and registration statements which
the U.S. Borrower may file or be required to file with the SEC under
Section 13 or 15(d) of the Securities Exchange Act of 1934, or with any
national securities exchange, and in any case not otherwise required to
be delivered to the Administrative Agent pursuant hereto;
(d) promptly after the furnishing thereof, copies of any statement or
report furnished to any holder of debt securities of any Loan Party or of
any of its Subsidiaries pursuant to the terms of any indenture, loan or
credit or similar agreement and not otherwise required to be furnished to
the Lenders pursuant to any other clause of this Section 6.02;
(e) promptly and in any event within five Business Days after receipt
thereof by any Loan Party or any of its Subsidiaries, notice of receipt
of any notice or other correspondence received from the SEC (or
comparable agency in any applicable non-U.S. jurisdiction) concerning any
material investigation or possible material investigation or other
material inquiry by such agency regarding financial or other operational
results of any Loan Party or any of its Subsidiaries, but not copies of
any such notice or correspondence;
(f) promptly after the occurrence thereof, notice of any
Environmental Action against or of any noncompliance by any Loan Party or
any of its Subsidiaries with any Environmental Law or Environmental Permit
that could reasonably be expected to have a Material Adverse Effect ;
(g) in the case of the UK Borrower, prompt notice of any change of
name, change of office address or change in the center of main business;
and
(h) promptly, such additional information regarding the business,
financial, legal or corporate affairs of any Loan Party or any Subsidiary
thereof, or compliance with the terms of the Loan Documents, as the
Administrative Agent or any Lender may from time to time reasonably
request.
Documents required to be delivered pursuant to Section 6.01(a), (b)
or (c) or otherwise (to the extent any such documents are included in
materials otherwise filed with the
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SEC) may be delivered electronically and if so delivered, shall be deemed to
have been delivered on the date (i) on which the U.S. Borrower posts such
documents, or provides a link thereto on the U.S. Borrower's website on the
Internet at the website address listed on Schedule 10.02; or (ii) on which such
documents are posted on the U.S. Borrower's behalf on an Internet or intranet
website, if any, to which each Lender and the Administrative Agent have access
(whether a commercial, third-party website or whether sponsored by the
Administrative Agent); provided that the U.S. Borrower shall notify the
Administrative Agent and each Lender who, upon reasonable written notice,
specifically requests such notifications from the U.S. Borrower (by telecopier
or electronic mail) of the posting of any such documents and provide to the
Administrative Agent by electronic mail electronic versions (i.e., soft copies)
of such documents. Except for the Compliance Certificate, the Administrative
Agent shall have no obligation to request the delivery or to maintain copies of
the documents referred to above, and in any event shall have no responsibility
to monitor compliance by the U.S. Borrower with any such request for delivery,
and each Lender shall be solely responsible for requesting delivery to it or
maintaining its copies of such documents.
The Borrowers hereby acknowledge that (a) the Administrative Agent
and/or the Arranger will make available to the Lenders and the L/C Issuer
materials and/or information provided by or on behalf of the Borrowers
hereunder (collectively, "Borrower Materials") by posting the Borrower
Materials on IntraLinks or another similar electronic system (the "Platform")
and (b) certain of the Lenders may be "public-side" Lenders (i.e., Lenders that
do not wish to receive material non-public information with respect to the
Borrowers or their securities) (each, a "Public Lender"). The Borrowers hereby
agree that they will use commercially reasonable efforts to identify that
portion of the Borrower Materials that may not be distributed to the Public
Lenders and that (w) all such Borrower Materials shall be clearly and
conspicuously marked "MATERIAL NON-PUBLIC" which, at a minimum, shall mean that
the word "MATERIAL NON-PUBLIC" shall appear prominently on the first page
thereof; (x) by marking Borrower Materials "MATERIAL NON-PUBLIC," the Borrowers
shall be deemed to have directed the Administrative Agent, the Arrangers, the
L/C Issuer and the Lenders to treat such Borrower Materials as either
confidential information or as containing material non-public information with
respect to the Borrowers or their securities for purposes of United States
Federal and state securities laws (provided, however, that to the extent such
Borrower Materials constitute Information, they shall be treated as set forth
in Section 10.07); (y) all Borrower Materials not marked "MATERIAL NON-PUBLIC"
are permitted to be made available through a portion of the Platform designated
"Public Investor" and the Borrowers hereby authorize the Administrative Agent,
the Arrangers, the L/C Issuer and the Lenders to treat all such Borrower
Materials as either publicly available information or information that although
it may be sensitive and proprietary, is not material with respect to the
Borrowers or their securities for purposes of United States Federal and State
securities; and (z) the Administrative Agent and the Arranger shall treat any
Borrower Materials that are marked "MATERIAL NON-PUBLIC" as being suitable only
for posting on a portion of the Platform not designated "Public Investor."
6.03 Notices. Promptly notify the Administrative Agent and each
Lender:
(a) of the occurrence of any Default;
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(b) of any matter that has resulted or could reasonably be expected
to result in a Material Adverse Effect;
(c) of the occurrence of any ERISA Event;
(d) of the (A) occurrence of any Disposition of property or assets
for which the U.S. Borrower is required to make a mandatory prepayment
pursuant to Section 2.07(b)(ii) and (B) incurrence or issuance of any
Indebtedness for which the U.S. Borrower is required to make a mandatory
prepayment pursuant to Section 2.07(b)(iii); and
(e) of the occurrence of any Internal Control Event.
Each notice pursuant to Section 6.03(a), (b), (c) or (e) shall be
accompanied by a statement of a Responsible Officer of the U.S. Borrower
setting forth details of the occurrence referred to therein and stating what
action the Borrowers have taken and propose to take with respect thereto. Each
notice pursuant to Section 6.03(a) shall describe with particularity any and
all provisions of this Agreement and any other Loan Document in respect of
which a Default exists.
6.04 Payment of Obligations. Pay, discharge or otherwise satisfy as
the same shall become due and payable, (a) all material tax liabilities,
assessments and governmental charges or levies upon it or its properties or
assets, unless the same are being contested in good faith by appropriate
proceedings diligently conducted and adequate reserves in accordance with GAAP
are being maintained by such Borrower or such Subsidiary except to the extent
the failure to pay or discharge the same could not reasonably be expected to
have a Material Adverse Effect; and (b) all lawful claims which, if unpaid,
would by law become a Lien upon its property.
6.05 Preservation of Existence, Etc. (a) Other than as to Dormant
Subsidiaries, preserve, renew and maintain in full force and effect its legal
existence and good standing under the Laws of the jurisdiction of its
organization except in a transaction permitted by Section 7.04 or 7.05 and
(other than with respect to the Borrowers) to the extent the failure to do so
could not reasonably be expected to have a Material Adverse Effect; (b) take
all reasonable action to maintain all rights, privileges, permits, licenses
and franchises necessary or desirable in the normal conduct of its business,
except to the extent that failure to do so could not reasonably be expected to
have a Material Adverse Effect; and (c) preserve or renew all of its
registered patents, trademarks, trade names and service marks, except to the
extent the failure to preserve or renew could not reasonably be expected to
have a Material Adverse Effect.
6.06 Maintenance of Properties. Except if failure to do so could not
reasonably be expected to have a Material Adverse Effect, (a) maintain,
preserve and protect all of its material properties and equipment that are
necessary in the operation of its business in good working order and
condition, ordinary wear and tear excepted; and (b) make all necessary repairs
thereto and renewals and replacements thereof in accordance with prudent
industry practice; provided, however, that this Section 6.06 shall not apply
to Dormant Subsidiaries.
6.07 Maintenance of Insurance. Maintain with financially sound and
reputable insurance companies not Affiliates of the U.S. Borrower, insurance
with respect to its properties
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and business against loss or damage of the kinds customarily insured against by
Persons engaged in the same or similar business, of such types and in such
amounts (after giving effect to any self-insurance (including with captive
insurance companies) compatible with the following standards) as are
customarily carried under similar circumstances by such other Persons.
6.08 Compliance with Laws. Comply in all material respects with the
requirements of all Laws and all orders, writs, injunctions and decrees
applicable to it or to its business or property, except in such instances in
which (a) such requirement of Law or order, writ, injunction or decree is
being contested in good faith by appropriate proceedings diligently conducted;
or (b) the failure to comply therewith could not reasonably be expected to
have a Material Adverse Effect.
6.09 Books and Records. Maintain proper books of record and account,
in which full, true and correct entries shall be made of all material
financial transactions and matters involving the assets and business of the
Borrowers or such Subsidiary, as the case may be, in a manner that permits the
preparation of financial statements in accordance with GAAP.
6.10 Inspection Rights. Permit representatives and independent
contractors of the Administrative Agent and each Lender to visit and inspect
any of its properties, to examine its corporate, financial and operating
records, and make copies thereof or abstracts therefrom, and to discuss its
affairs, finances and accounts with its directors, officers, and independent
public accountants, all at such reasonable times during normal business hours,
in reasonable intervals, and upon reasonable advance notice to the Borrowers;
provided, that, excluding any such visits and inspections during the
continuation of an Event of Default, only the Administrative Agent on behalf
of the Lenders may exercise rights under this Section 6.10 and the
Administrative Agent shall not exercise such rights more often than two (2)
times during any calendar year and any one (1) such time shall be at the
Borrowers' expense; provided further, that when an Event of Default exists the
Administrative Agent or any Lender may do any of the foregoing at the expense
of the Borrowers at any time during normal business hours and upon reasonable
advance notice the Administrative Agent and the Lenders shall give the
Borrowers the opportunity to participate in any discussions with the
Borrowers' accountants.
6.11 Use of Proceeds. Use the proceeds of the Credit Extensions for
general corporate purposes not in contravention of any Law or of any Loan
Document.
6.12 Covenant to Guarantee Obligations and Give Security. (a) Upon
the formation or acquisition of any new direct or indirect Subsidiaries by any
Loan Party, then the U.S. Borrower shall, at the U.S. Borrower's expense:
(i) within 30 days after such formation or acquisition (or such
longer period as the Administrative Agent may agree in its reasonable
discretion), cause such Subsidiary to duly execute and deliver to the
Administrative Agent a guaranty or guaranty supplement, in form and
substance reasonably satisfactory to the Administrative Agent,
guaranteeing (A) if such Subsidiary is a domestic Subsidiary, the U.S.
Borrower's and ROV Guarantors' obligations under the Loan Documents in
the case of a Domestic Subsidiary, or (B) if such Subsidiary is a direct
or indirect parent of a Subsidiary Borrower, the obligations of such
Subsidiary Borrower under the Loan Documents.
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(ii) within 15 days after such formation or acquisition (or such
longer period as the Administrative Agent may agree in its reasonable
discretion), furnish to the Administrative Agent a description of the
real and personal properties of each such Domestic Subsidiary, in a form
substantially consistent with Schedules 5.08(b) and 5.08(c),
(iii) within 30 days after such formation or acquisition (or such
longer period as the Administrative Agent may agree in its reasonable
discretion), cause each such Subsidiary to duly execute and deliver, to
the Administrative Agent deeds of trust, trust deeds, mortgages,
leasehold mortgages, leasehold deeds of trust, Security Agreement
Supplements, IP Security Agreement Supplements, supplements to any
Foreign Collateral Documents, and other security and pledge agreements,
as specified by and in form and substance reasonably satisfactory to the
Administrative Agent (including delivery of all pledged Equity Interests
in and of such Subsidiary, and other instruments of the type specified in
Section 4.01(a)(iii), (iv) and (v) and using commercially reasonable
efforts to deliver instruments of the type specified in clause
6.18(a)(v), in each case, as applicable), securing payment of all the
Obligations of such Subsidiary under the Loan Documents and constituting
Liens on all such personal properties, all such owned real properties
with an estimated fair value equal to or greater than $5 million and all
such material leased real properties; provided that with respect to any
such property outside the U.S., the Administrative Agent shall not
require a Subsidiary to grant a security interest therein, or provide
other deliveries to the extent the Administrative Agent determines in its
reasonable discretion that the cost of obtaining such Lien or delivery is
excessive in relation to the benefit to the Lenders, of the security
afforded thereby.
(iv) within 60 days after such formation or acquisition (or such
longer period as the Administrative Agent may agree in its reasonable
discretion), cause each such Subsidiary to take whatever action
(including the recording of mortgages, the filing of Uniform Commercial
Code financing statements, the giving of notices and the endorsement of
notices on title documents) may be necessary or advisable in the opinion
of the Administrative Agent to vest in the Administrative Agent (or in
any representative of the Administrative Agent designated by it) valid
and subsisting Liens on the properties purported to be subject to the
deeds of trust, trust deeds, mortgages, leasehold mortgages, leasehold
deeds of trust, Security Agreement Supplements, IP Security Agreement
Supplements, supplements to Foreign Collateral Documents and security and
pledge agreements delivered pursuant to this Section 6.12, enforceable
against all third parties in accordance with their terms,
(v) within 30 days after the reasonable request therefor by the
Administrative Agent, deliver to the Administrative Agent, a signed copy
of a customary legal opinion, addressed to the Administrative Agent and
the other Secured Parties, of counsel for the Loan Parties reasonably
acceptable to the Administrative Agent as to the matters contained in
clauses (i), (iii) and (iv) above, and as to such other matters as the
Administrative Agent may reasonably request, and
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(vi) as promptly as practicable after such formation or acquisition,
deliver, upon the request of the Administrative Agent in its reasonable
discretion, to the Administrative Agent with respect to each parcel of
real property with fair market value equal to or greater than $5 million
owned or held by any domestic entity that is the subject of such
formation or acquisition title reports, surveys and environmental
assessment reports, each in scope, form and substance satisfactory to the
Administrative Agent, provided, however, that to the extent that any Loan
Party or any of its Subsidiaries shall have otherwise received any of the
foregoing items with respect to such real property, such items shall,
promptly after the receipt thereof, be delivered to the Administrative
Agent.
(b) Upon the acquisition of any personal property, any owned real
property with a fair market value greater than or equal to $5 million or any
material leased real property, by any Loan Party, and such property, in the
judgment of the Administrative Agent, shall not already be subject to a
perfected security interest in favor of the Administrative Agent for the
benefit of the Secured Parties provided that with respect to any such property
outside the U.S., the Administrative Agent shall not require a Loan Party to
comply with the following provisions to the extent that the Administrative
Agent determines, in its reasonable discretion, that the cost of such
compliance is excessive in relation to the benefit to be afforded to the
Lenders thereby, then the U.S. Borrower shall, at the U.S. Borrower's expense:
(i) within 15 days after such acquisition (or such longer period as
the Administrative Agent may agree in its reasonable discretion), furnish
to the Administrative Agent a description of the property so acquired in
detail reasonably satisfactory to the Administrative Agent,
(ii) within 30 days after such acquisition (or such longer period as
the Administrative Agent may agree in its reasonable discretion), cause
the applicable Loan Party to take whatever action (including the
execution and delivery of any agreement set forth in Section
6.12(a)(iii), the recording of mortgages, the filing of Uniform
Commercial Code financing statements, the giving of notices and the
endorsement of notices on title documents) may be necessary or advisable
in the opinion of the Administrative Agent to vest in the Administrative
Agent (or in any representative of the Administrative Agent designated by
it) valid Liens on such property in accordance with the Loan Parties,
enforceable against all third parties,
(iii) within 30 days after the request therefor by the Administrative
Agent (or such longer period as the Administrative Agent may agree in its
reasonable discretion), deliver to the Administrative Agent a signed copy
of a favorable opinion, addressed to the Administrative Agent and the
other Secured Parties, of counsel for the Loan Parties reasonably
acceptable to the Administrative Agent as to the matters contained in
clause (ii) above and as to such other matters as the Administrative
Agent may reasonably request, and
(iv) as promptly as practicable after any acquisition of any such
real property, deliver, upon the request of the Administrative Agent in
its reasonable discretion, to the Administrative Agent with respect to
such real property title reports, surveys and
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environmental assessment reports, each in scope, form and substance
satisfactory to the Administrative Agent, provided, however, that to the
extent that any Loan Party or any of its Subsidiaries shall have otherwise
received any of the foregoing items with respect to such real property,
such items shall, promptly after the receipt thereof, be delivered to the
Administrative Agent,
(c) Upon the request of the Administrative Agent following the
occurrence and during the continuance of a Default, the U.S. Borrower shall,
at the U.S. Borrower's expense, furnish to the Administrative Agent such
descriptions of property of the U.S. Borrower and its Subsidiaries and deliver
to the Administrative Agent such additional Collateral Documents and other
deliveries of the nature contemplated by this Section 6.12 and Section
4.01(a), in each case to the extent, and within time periods, reasonably
requested by the Administrative Agent.
(d) In the event of, and upon the consummation of, an amendment to
the 2013 Notes Indenture that revises the covenants in the 2013 Notes
Indenture to be similar to the covenants in the 2015 Notes Indenture and,
specifically, allows new or additional Liens over the assets of foreign
Subsidiaries of the U.S. Borrower to secure the Obligations of the Subsidiary
Borrowers, the U.S. Borrower shall, at the U.S. Borrower's expense, (A)
deliver amendments, modifications, supplements to, restatements of or
replacements for, certain of the Foreign Collateral Documents including,
without limitation, (i) the UK Share Charges, the German Share Pledges, the
Netherlands Share Pledge and the German Account Pledge, (ii) pledge or other
agreements in respect of the Equity Interests of each Subsidiary Borrower and
(iii) take action of the type described in Section 6.12(a)(iii) and (iv) to
create valid perfected security interests over all property of each Subsidiary
Borrower as the Administrative Agent may reasonably request and (B) if Rayovac
(UK) Ltd. has not been put into liquidation at such time, a KGaA Guaranty and
a UK Guaranty duly executed by Rayovac (UK) Ltd..
(e) At any time upon request of the Administrative Agent, promptly
execute and deliver any and all further instruments and documents and take all
such other action as the Administrative Agent may deem necessary or desirable
in obtaining the full benefits of, or in perfecting and preserving the Liens
of, such guaranties, deeds of trust, trust deeds, mortgages, leasehold
mortgages, leasehold deeds of trust, Security Agreement Supplements, IP
Security Agreement Supplements, supplements to Foreign Collateral Documents
and other security and pledge agreements;
Notwithstanding the foregoing, (x) the Administrative Agent shall not
take a security interest in or require any title insurance or similar items
with respect to those assets as to which the Administrative Agent shall
determine, in its reasonable discretion, that the cost of obtaining such Lien
(including any mortgage, stamp, intangibles or other tax, title insurance or
similar items) is excessive in relation to the benefit to the Lenders of the
security afforded thereby and (y) Liens required to be granted pursuant to
this Section 6.12 shall be subject to exceptions and limitations consistent
with those set forth herein and in the Collateral Documents as in effect on
the Closing Date (to the extent appropriate in the applicable jurisdiction).
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provided, however, that in no event shall (a) greater than 65% of the issued
and outstanding Equity Interests of any Subsidiary Borrower or any foreign
Subsidiary be pledged or similarly hypothecated to Guarantee any Obligation of
the U.S. Borrower or any Domestic Subsidiary, (b) the Subsidiary Borrower or
any foreign Subsidiary Guarantee any Obligation of the U.S. Borrower or any
Domestic Subsidiary or (c) any security or similar interest be granted in the
assets of the Subsidiary Borrower or any foreign Subsidiary that secures or
Guarantees any Obligation of the U.S. Borrower or any Domestic Subsidiary.
6.13 Compliance with Environmental Laws. Except to the extent that
failure to do so could not reasonably be expected to have a Material Adverse
Effect, comply, and cause all lessees and other Persons operating or occupying
its properties to comply, in all material respects, with all applicable
Environmental Laws and Environmental Permits; obtain and renew all
Environmental Permits necessary for its operations and properties; and conduct
any investigation, study, sampling and testing, and undertake any cleanup,
removal, remedial or other action necessary to remove and clean up all
Hazardous Materials from any of its properties, materially in accordance with
the requirements of all applicable Environmental Laws; provided, however, that
neither the Borrowers nor any of their Subsidiaries shall be required to
undertake any such cleanup, removal, remedial or other action (a) to the
extent that its obligation to do so is being contested in good faith and by
proper proceedings and appropriate reserves are being maintained with respect
to such circumstances or (b) where failure to do so could not, individually or
in the aggregate, reasonably be expected to have a Material Adverse Effect.
6.14 Further Assurances. Promptly upon request by the Administrative
Agent, or any Lender through the Administrative Agent, (a) correct any
material defect or error that may be discovered in any Loan Document or in the
execution, acknowledgment, filing or recordation thereof, and (b) do, execute,
acknowledge, deliver, record, re-record, file, re-file, register and
re-register any and all such further acts, deeds, certificates, assurances and
other instruments as the Administrative Agent, or any Lender through the
Administrative Agent, may reasonably require from time to time in order to (i)
to the fullest extent permitted by applicable law, subject any Loan Party's
properties, assets, rights or interests to the Liens now or hereafter intended
to be covered by any of the Collateral Documents, (ii) perfect and maintain
the validity, effectiveness and priority of any of the Collateral Documents
and any of the Liens intended to be created thereunder and (iii) assure,
convey, grant, assign, transfer, preserve, protect and confirm more
effectively unto the Secured Parties the rights granted or now or hereafter
intended to be granted to the Secured Parties under any Loan Document or under
any other instrument executed in connection with any Loan Document to which
any Loan Party or any of its Subsidiaries is or is to be a party, and cause
each of its Subsidiaries to do so.
6.15 Interest Rate Hedging. Enter into prior to the Closing Date, and
maintain at all times thereafter, either Consolidated Funded Indebtedness
accruing interest at a fixed rate, or interest rate Swap Contracts (with
Persons acceptable to the Administrative Agent and providing for such Persons
to make payments thereunder for a period of the lesser of (a) three years and
(b) the Maturity Date with respect to the Term Facilities), covering a
notional amount of not less than 35% of the amount of Consolidated Funded
Indebtedness at such time.
6.16 Cash Collateral Accounts. Maintain, and cause each of its
Subsidiaries to maintain, all domestic Cash Collateral Accounts with Bank of
America.
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6.17 Euro Borrower Financial Condition.
The U.S. Borrower shall:
(a) provide at all times sufficient financial means to the Euro
Borrower and, if necessary, increase the capital of the Euro Borrower, to
ensure that none of the following situations occurs in which ROV German
General Partner GmbH would be obligated or entitled to file an application for
the opening of insolvency proceedings against the Euro Borrower under the
German Insolvency Act (Insolvenzordnung) pursuant to Section 283 No. 14 in
connection with Section 92 German Stock Corporation Act (Aktiengesetz):
(i) the Euro Borrower is not able to pay its obligations when they
become due (zahlungsunfahig) in the sense of Section 17(2) of the German
Insolvency Act;
(ii) the Euro Borrower is overindebted (uberschuldet) in the sense of
Section 19(2) of the German Insolvency Act; or
(iii) there is the threat that, in the immediate future, the Euro
Borrower is not able to pay obligations when they become due (drohende
Zahlungsunfahigkeit) in the sense of Section 18(2) of the German
Insolvency Act;
(b) ensure that there are reporting procedures in place so that the
U.S. Borrower is timely informed of the overall financial situation of the
Euro Borrower and, in particular the ability of the Euro Borrower to pay its
obligations when due and the status of its indebtedness; and
(c) notify the Administrative Agent not less than two Business Days
prior to making any investment in order to comply with its obligation under
subsection (a) above.
6.18 Real Estate Post-Closing Obligations.
Within 60 days after the Closing Date (or such later date as the
Administrative Agent may agree in its sole discretion), deliver to the
Administrative Agent (or, in the case of clause (v), use commercially
reasonable efforts to deliver to the Administrative Agent):
(a) (1) deeds of trust, trust deeds, mortgages, leasehold mortgages
and leasehold deeds of trust, in substantially the form of Exhibit H-1 or (2)
Mortgage Amendments in substantially the form of Exhibit H-2 (in each case
with such changes as may be satisfactory to the Administrative Agent and its
counsel to account for local law matters) covering the Mortgage Properties
(the mortgages, as amended by the Mortgage Amendments, together with each
other mortgage delivered pursuant to Section 6.12, in each case as amended,
the "Mortgages"), duly executed by the appropriate Loan Party, together with:
(i) evidence that counterparts of the Mortgages have been duly
executed, acknowledged and delivered and are in form suitable for filing
or recording in all filing or recording offices that the Administrative
Agent may deem necessary or desirable in order to create a valid first
and subsisting Lien on the property described therein in favor of the
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Administrative Agent for the benefit of the Secured Parties and that all
filing and recording taxes and fees have been paid,
(ii) with respect to Mortgages, other than Mortgages amended by the
Mortgage Amendments, fully paid American Land Title Association Lender's
Extended Coverage title insurance policies (the "Mortgage Policies") in
form and substance, with endorsements and in amounts acceptable to the
Administrative Agent, issued, coinsured and reinsured by title insurers
acceptable to the Administrative Agent, insuring the Mortgages to be
valid first and subsisting Liens on the property described therein, free
and clear of all defects (including, but not limited to, mechanics' and
materialmen's Liens) and encumbrances, excepting only Permitted
Encumbrances and other Liens permitted under the Loan Documents, and
providing for such other affirmative insurance (including endorsements
for future advances under the Loan Documents and for mechanics' and
materialmen's Liens) and such coinsurance and direct access reinsurance
as the Administrative Agent may deem necessary or desirable,
(iii) with respect to the Mortgage Amendments, fully paid American
Land Title Association date down endorsements of the mortgage policies of
title insurers insuring that the Mortgage, as amended by the Mortgage
Amendment, creates and constitutes a valid first mortgage Lien against
the applicable Mortgaged Property in favor of the Administrative Agent,
(iv) copies of all the surveys currently in the possession of any
Loan Party or Subsidiary with respect to each Mortgage Property,
(v) estoppel and consent agreements, in form and substance
satisfactory to the Administrative Agent, executed by each of the lessors
of the leased real properties listed on Schedule 5.08(c) that are not
subject to an existing Mortgage, along with (A) a memorandum of lease in
recordable form with respect to such leasehold interest, executed and
acknowledged by the owner of the affected real property, as lessor, or
(B) evidence that the applicable lease with respect to such leasehold
interest or a memorandum thereof has been recorded in all places
necessary or desirable, in the Administrative Agent's reasonable
judgment, to give constructive notice to third-party purchasers of such
leasehold interest, or (C) if such leasehold interest was acquired or
subleased from the holder of a recorded leasehold interest, the
applicable assignment or sublease document, executed and acknowledged by
such holder, in each case in form sufficient to give such constructive
notice upon recordation and otherwise in form satisfactory to the
Administrative Agent,
(vi) evidence of the insurance required by the terms of the
Mortgages, and
(vii) such other consents, agreements and confirmations of third
parties as the Administrative Agent may deem reasonably necessary or
desirable and evidence that all other action that the Administrative
Agent may deem reasonably necessary or desirable in order to create valid
Liens on the property described in the Mortgages has been taken; and
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(b) opinions of local counsel for the Loan Parties in states in which
the Mortgage Properties are located, with respect to the enforceability and
perfection of the Mortgages and any related fixture filings substantially in
the form of Exhibit I-3 hereto (with such changes as may be approved by the
Administrative Agent and its counsel to account for local law matters), and
otherwise in form and substance reasonably satisfactory to the Administrative
Agent; and
(c) the opinion of counsel to the Loan Parties, addressed to the
Administrative Agent and each Lender, as to certain corporate formalities in
form and substance reasonably satisfactory to the Administrative Agent.
6.19 Foreign Collateral Post-Closing Obligations. Within 30 days
after the Closing Date (or such later date as the Administrative Agent may
agree in its sole discretion) deliver to the Administrative Agent:
(a) each of the Cayman Share Charges, duly executed by ROV Holding,
in each case together with evidence that all other actions, deliveries,
registrations and filings that the Administrative Agent may deem
necessary or desirable in order to create perfected security interests in
the assets expressed to be pledged thereunder have been taken, delivered
or made;
(b) a German Share Pledge in respect of the Equity Interests of ROV
Europe GmbH, together with all evidence that all other actions,
deliveries, registrations and filings that the Administrative Agent may
deem necessary or desirable in order to create perfected security
interests in the assets expressed to be pledged thereunder have been
taken, delivered or made;
(c) an amendment to each of the German Global Assignment and German
Security Transfer Agreement, duly executed by the Euro Borrower, in each
case together with evidence that all other actions, deliveries,
registrations and filings that the Administrative Agent may deem
necessary or desirable in order to create perfected security interests in
the assets expressed to be pledged thereunder have been taken, delivered
or made;
(d) a Reaffirmation of the Canadian Share Pledge, duly executed by
ROV Holding, together with evidence that all other actions, deliveries,
registrations and filings, including PPSA registrations, that the
Administrative Agent may deem necessary or desirable in order to create
perfected security interests in the assets expressed to be pledged
thereunder have been taken, delivered or made;
(e) a favorable opinion of counsel to the Loan Parties in each of
Canada, Germany, Cayman Islands and Delaware, addressed to the
Administrative Agent and each Lender, as to such matters concerning the
Loan Parties and the Loan Documents as the Administrative Agent may
reasonably request; or
(f) if such entities have not been merged into other Loan Parties
prior to such date (with such other Loan Party being the surviving
Person), a favorable opinion of Nevada and California counsel to each of
Firstrax Pet Products Inc., Firstrax Inc. and TAP, LLC
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as to such matters concerning such entity as the Administrative Agent may
reasonably request.
ARTICLE VII
NEGATIVE COVENANTS
So long as any Lender shall have any Commitment hereunder, any Loan
or other Obligation hereunder shall remain unpaid or unsatisfied, or any
Letter of Credit shall remain outstanding, each Borrower shall not, nor shall
it permit any Subsidiary to, directly or indirectly:
7.01 Liens.
Create, incur, assume or suffer to exist any Lien upon any of its
property, assets or revenues, whether now owned or hereafter acquired, other
than the following ("Permitted Liens"):
(a) Liens pursuant to any Loan Document;
(b) Liens existing on the date hereof and listed on Schedule 7.01(b)
and any renewals or extensions thereof, provided that (i) the property
covered thereby is not changed and (ii) the amount secured or benefited
thereby is not increased;
(c) Liens for Taxes, fees, assessments or other governmental charges
which are not overdue by more than 30 days or, if more than 30 days
overdue, (i) remain payable without penalty, (ii) which are being
contested in good faith and by appropriate proceedings diligently
conducted, if adequate reserves with respect thereto are maintained on
the books of the applicable Person in accordance with GAAP or (iii) with
respect to which in the aggregate the failure to make payment could not
reasonably be expected to have a Material Adverse Effect;
(d) Statutory liens of landlords, warehousemen's, mechanics',
materialmen's, repairmen's or other like Liens arising in the ordinary
course of business that secure amounts that are not overdue by more than
30 days or, if more than 30 days overdue, (i) with respect to which no
action has been taken to enforce such Lien, (ii) which are being
contested in good faith and by appropriate proceedings diligently
conducted, if adequate reserves with respect thereto are maintained on
the books of the applicable Person or (iii) with respect to which in the
aggregate the failure to make payment could not reasonably be expected to
have a Material Adverse Effect;
(e) (i) pledges or deposits in the ordinary course of business in
connection with workers' compensation, unemployment insurance and other
social security legislation, other than any Lien imposed by ERISA (ii)
pledges and deposits in the ordinary course of business securing
insurance premiums or reimbursement obligations under insurance policies,
in each case payable to insurance carriers that provide insurance to the
US Borrower or any of its Subsidiaries or (iii) obligations in respect of
letters of credit or bank guarantees that have been posted by the U.S.
Borrower or any of its Subsidiaries to support the payments of the items
set forth in clauses (i) and (ii) of this Section 7.01(e);
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(f) deposits made and letters of credit issued to secure the
performance of bids, trade contracts and leases (other than
Indebtedness), statutory obligations, surety, stay, customs and appeal
bonds, performance bonds, performance and completion guarantees and other
obligations of a like nature (including those to secure health, safety
and environmental obligations) incurred in the ordinary course of
business; provided that all such liens and letters of credit in the
aggregate would not (even if enforced, or, in the case of letters of
credit, fully drawn) cause a Material Adverse Effect;
(g) easements, rights-of-way, restrictions, encroachments,
protrusions and other similar encumbrances and minor title defects
affecting real property that do not secure Indebtedness incurred in the
ordinary course of business which, in the aggregate, are not substantial
in amount, and which do not in any case materially and adversely affect
the use of the property subject thereto for its intended purpose;
(h) Liens securing judgments for the payment of money not
constituting an Event of Default under Section 8.01(h);
(i) Liens securing Indebtedness permitted under Section 7.02(e)
(including, without limitation, over any property acquired pursuant to
the Rosata/Paula Acquisitions); provided that (i) such Liens do not at
any time encumber any property other than the property financed by such
Indebtedness or, if applicable, subject to such Capitalized Lease and the
proceeds and product thereof and accessions thereto, (ii) the
Indebtedness secured thereby does not exceed the cost or fair market
value, whichever is lower, of the property being acquired on the date of
acquisition and (iii) individual financings of one lender may be
cross-collateralized to other financings of the same type of equipment
provided by such lender;
(j) other Liens securing Indebtedness or other obligations
outstanding in an aggregate principal amount not to exceed $15,000,000;
provided that any such Liens that extends to or covers any Collateral
shall not secure Indebtedness or other obligations in an aggregate
principal amount greater than $10 million;
(k) the replacement, extension or renewal of any Lien permitted by
subsections (b), (i) and (j) of this Section 7.01 above upon or in the
same property theretofore subject thereto or the replacement, extension
or renewal (without increase in the amount (including interest and fees)
or change in any direct or contingent obligor) of the Indebtedness
secured thereby.
(l) Liens arising solely by virtue of any statutory or common law
provision relating to banker's liens, rights of set-off or similar rights
and remedies as to deposit accounts or other funds maintained with a
creditor depository institution, provided that such deposit account is
not intended by the U.S. Borrower or any Subsidiary to provide collateral
to the depository institution;
(m) Liens relating to IRB Debt permitted by Section 7.02(j) covering
only those capital improvements financed by such IRB Debt;
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(n) Liens on property of any Subsidiary in favor of the U.S. Borrower
or any other Subsidiary, provided that any such Lien shall be
subordinated to any Lien of the Administrative Agent on the applicable
property pursuant to documentation in form and substance reasonably
acceptable to the Administrative Agent;
(o) Liens on property of Remington Products Australia, Remington
Consumer Products (Ireland) Limited and Remington Products New Zealand
Ltd securing Indebtedness of such Subsidiary that is permitted under the
provisions of Section 7.02; and
(p) Liens on property of any Foreign Subsidiary (other than any
Subsidiary Borrower) securing Indebtedness of such Foreign Subsidiary
permitted under the provisions of Section 7.02(g); provided that no such
Lien shall extend to or cover any Collateral.
(q) (i) leases, licenses, subleases or sublicenses granted to other
Persons in the ordinary course of business which do not (x) interfere in
any material respect with the business of the U.S. Borrower or any of its
material Subsidiaries or (y) secure any Indebtedness for borrowed money
or (ii) the rights reserved or vested in any Person by the terms of any
lease, license, franchise, grant or permit held by the U.S. Borrower or
any of its Subsidiaries or by a statutory provision, to terminate any
such lease, license, franchise, grant or permit, or to require annual or
periodic payments as a condition to the continuance thereof;
(r) 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 in the ordinary course of business;
(s) Liens (i) of a collection bank arising under Section 4-210 of the
Uniform Commercial Code on items in the course of collection and (ii) of
a commodity intermediary attaching to commodity trading accounts or other
commodities brokerage accounts incurred in the ordinary course of
business and not for speculative purposes; provided that such accounts or
are not intended by the U.S. Borrower or any Subsidiary to provide
collateral to the commodity intermediary;
(t) Liens (i) in favor of the seller of any property to be acquired
in an Investment permitted pursuant to Sections 7.03(h), (i) and (j) to
be applied against the purchase price for such Investment, (ii)
consisting of an agreement to Dispose of any property in a Disposition
permitted under Section 7.05, in each case, solely to the extent such
Investment or Disposition, as the case may be, would have been permitted
on the date of the creation of such Lien and (iii) earnest money deposits
made by the Borrower or any of its Subsidiaries in connection with any
letter of intent or purchase agreement entered into in connection with an
Investment permitted under Section 7.03;
(u) Liens existing on the property of any Person that becomes a
Subsidiary (or is merged into or consolidated with any of the
Subsidiaries of the Borrowers), in each case after the date hereof (other
than Liens on the Equity Interests of any Person that
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becomes a Subsidiary) and any modifications, replacements, renewals or
extensions thereof; provided that (i) such Lien does not extend to or
cover any other assets or property (other than the proceeds or products
thereof and after-acquired property subjected to a Lien pursuant to terms
existing at the time of such acquisition, it being understood that such
requirement shall not be permitted to apply to any property to which such
requirement would not have applied but for such acquisition), (ii) such
Lien was not created in anticipation of such merger or consolidation and
(iii) the Indebtedness secured thereby (or, as applicable, any
modifications, replacements, renewals or extensions thereof) is permitted
under Section 7.02(p);
(v) Liens arising out of conditional sale, title retention,
consignment or similar arrangements for sale of goods entered into by the
U.S. Borrower or any of its Subsidiaries in the ordinary course of
business not prohibited by this Agreement;
(w) Liens deemed to exist in connection with Investments in
repurchase agreements under Section 7.03; and
(x) Liens that are contractual rights of set-off (i) relating to
pooled deposit or sweep accounts of the Borrowers or any Subsidiary to
permit satisfaction of overdraft or similar obligations incurred in the
ordinary course of business of a Borrower and its Subsidiaries or (ii)
relating to agreements entered into with customers of the Borrowers or
any Subsidiary in the ordinary course of business.
7.02 Indebtedness. Create, incur, assume or suffer to exist any
Indebtedness, except:
(a) Indebtedness evidenced by the Subordinated Notes;
(b) Intercompany Indebtedness permitted by Section 7.03(c), which
Indebtedness shall (i) in the case of Indebtedness owed to a Loan Party
that is evidenced by an instrument, constitute Pledged Debt and (ii) be
on subordination terms reasonably acceptable to the Administrative Agent;
(c) Indebtedness under the Loan Documents;
(d) Guarantees of the U.S. Borrower and Loan Parties in respect of
Indebtedness otherwise permitted hereunder of any Wholly-Owned
Subsidiary;
(e) Indebtedness in respect of Capitalized Leases, Synthetic Lease
Obligations and purchase money obligations to finance the purchase,
repair or improvement of fixed or capital assets within the limitations
set forth in Section 7.01(i); provided, however, that the aggregate
amount of all such Indebtedness at any one time outstanding during each
fiscal year shall not exceed the amount of Capital Expenditures permitted
to be made on or prior to such time pursuant to Section 7.12.
(f) other unsecured Indebtedness (excluding Indebtedness of foreign
Subsidiaries) in an aggregate principal amount not to exceed $50,000,000
at any time
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outstanding provided that up to $15 million of such Indebtedness may be
secured by Liens permitted by Section 7.01.
(g) Indebtedness of foreign Subsidiaries to Persons other than the
U.S. Borrower and its Subsidiaries in an aggregate amount (other than
Indebtedness permitted by subsection (e) above) not at any time exceeding
$100,000,000 (provided the aggregate amount of Indebtedness of the
Subsidiary Borrowers, other than Indebtedness hereunder or permitted by
subsection (c) or (e) above, shall not exceed $25,000,000);
(h) Indebtedness in connection with Guarantees resulting from
endorsement of negotiable instruments in the ordinary course of business;
(i) Obligations in respect of surety, stay customs and appeal bonds,
performance bonds and performance and completion guarantees required in
the ordinary course of business or in connection with the enforcement of
rights or claims of the U.S. Borrower or its Subsidiaries or in
connection with judgments that do not result in an Event of Default;
(j) IRB Debt in a principal amount not to exceed $20,000,000 at any
one time outstanding;
(k) Indebtedness incurred by the Euro Borrower in connection with
leases for the Euro Borrower's leased facilities located in Ellwangen,
Germany and Dischingen, Germany;
(l) endorsements for collection or deposit in the ordinary course of
business;
(m) Indebtedness outstanding on the date hereof and listed on
Schedule 7.02 and any refinancings, refundings, renewals or extensions
thereof; provided that the principal amount of such Indebtedness is not
increased at the time of such refinancing, refunding, renewal or
extension except by an amount equal to a reasonable premium or other
reasonable amount paid, and fees and expenses reasonably incurred, in
connection with such refinancing and by an amount equal to any existing
commitments unutilized thereunder or as otherwise permitted by this
Section 7.02 and the direct or any contingent obligor with respect
thereto is not changed, as a result of or in connection with such
refinancing, refunding, renewal or extension; provided still further that
the terms relating to principal amount, amortization, maturity,
collateral (if any) and subordination (if any), and other material terms
taken as a whole, of any such refinancing, refunding, renewing or
extending Indebtedness, and of any agreement entered into and of any
instrument issued in connection therewith, are no less favorable in any
material respect to the Loan Parties or the Lenders than the terms of any
agreement or instrument governing the Indebtedness being refinanced,
refunded, renewed or extended and the interest rate applicable to any
such refinancing, refunding, renewing or extending Indebtedness does not
exceed the then applicable market interest rate; and
(n) Indebtedness constituting Investments permitted by Section
7.03(i), (l) and (p).
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(o) Indebtedness (other than for borrowed money) constituting Liens
permitted under Section 7.01;
(p) Indebtedness of a Borrower and its Subsidiaries (A) assumed in
connection with any Permitted Acquisition; provided that such
Indebtedness is not incurred in contemplation of such Permitted
Acquisition, or (B) owed to the seller of any property acquired in a
Permitted Acquisition on an unsecured subordinated basis, which
subordination shall be on terms reasonably satisfactory to the
Administrative Agent, in each case, so long as (1) both immediately prior
and after giving effect thereto, (x) no Event of Default shall exist or
result therefrom, and (y) a Borrower and its Subsidiaries will be in pro
forma compliance with the covenants set forth in Section 7.11, after
giving effect to such Permitted Acquisition and the incurrence or
issuance of such Indebtedness, (2) the final maturity date of such
Indebtedness is at least 91 days after the Maturity Date with respect to
the Term Facilities, (3) the weighted average life to maturity of such
Indebtedness is greater than the weighted average life to maturity of the
Term Facilities and (4) such Indebtedness is on terms no less favorable
to the U.S. Borrower and its Subsidiaries than the terms of the
Subordinated Notes Indentures;
(q) Indebtedness incurred by the Borrowers or their respective
Subsidiaries in a Permitted Acquisition or Disposition under agreements
providing for indemnification, the adjustment of the purchase price or
similar adjustments;
(r) Indebtedness consisting of obligations of the Borrowers or their
respective Subsidiaries under deferred compensation or other similar
arrangements to employees of such Person or incurred by such Person in
connection with the Merger and Permitted Acquisitions;
(s) Indebtedness in respect of netting services, overdraft
protections and similar arrangements in each case in connection with cash
management and deposit accounts;
(t) Indebtedness consisting of (i) the financing of insurance
premiums in the ordinary course of business or (ii) take or pay
obligations contained in supply arrangements not to exceed $100,000,000
in the aggregate;
(u) Indebtedness incurred by any Borrower or any of its Subsidiaries
constituting reimbursement obligations with respect to letters of credit
issued in the ordinary course of business in respect of workers
compensation claims, health, disability or other employee benefits or
property, casualty or liability insurance or self-insurance, other
Indebtedness with respect to reimbursement-type obligations regarding
workers compensation claims, or other Indebtedness in respect of bankers'
acceptance, letter of credit, warehouse receipts or similar facilities
entered into in the ordinary course of business; provided that upon the
drawing of such letters of credit or the incurrence of such Indebtedness,
such obligations are reimbursed within thirty (30) days following such
drawing or incurrence;
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(v) A Chinese Facility contemplated by clause (i) of the definition
thereof; and
(w) all premiums (if any), interest (including post-petition
interest), fees, expenses, charges and additional or contingent interest
on obligations described in clauses (a) through (v) above.
7.03 Investments. Make or hold any Investments, except:
(a) Investments held by the U.S. Borrower and its Subsidiaries in
assets that were Cash Equivalents when such Investment was made;
(b) advances to officers, directors and employees of the U.S.
Borrower and Subsidiaries (i) in an aggregate amount not to exceed
$10,000,000 at any time outstanding, for travel, entertainment,
relocation and analogous ordinary business purposes and (ii) in
connection with such Person's purchase of Equity Interests of the U.S.
Borrower, in an aggregate amount not to exceed $10,000,000 (in each of
clauses (i) and (ii), determined without regard to any write-downs or
write-offs of such loans or advances);
(c) Investments by the U.S. Borrower in any Wholly-Owned Subsidiary
and Investments of any Subsidiary in any Wholly-Owned Subsidiary provided
that, immediately before and after giving effect to such Investment, no
Event of Default shall have occurred and be continuing and the aggregate
amount invested by the U.S. Borrower and its Subsidiaries (other than
foreign Subsidiaries) in foreign Subsidiaries after the Closing Date
(excluding Investments in Ningbo Baowang Battery Company, Microlite S.A.
and the Euro Borrower to the extent they increase the percentage of the
Equity Interests held by a Wholly-Owned Subsidiary in each such
Subsidiary) shall not exceed $100,000,000;
(d) Investments consisting of extensions of credit in the nature of
accounts receivable or notes receivable arising from the grant of trade
credit in the ordinary course of business, and Investments received in
satisfaction or partial satisfaction thereof from financially troubled
account debtors and other credits to suppliers in the ordinary course of
business;
(e) Guarantees permitted by Section 7.02;
(f) Investments existing on the date hereof and set forth on Schedule
7.03(f);
(g) Investments by the U.S. Borrower in Swap Contracts;
(h) the purchase or other acquisition of all of the Equity Interests
in, or all or substantially all of the property and assets constituting a
line of business, a business unit or division of, any Person that, upon
the consummation thereof, will be wholly owned directly by the U.S.
Borrower or one or more of its Wholly-Owned Subsidiaries (other than any
80% Subsidiary) (including as a result of a merger or consolidation);
provided
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that, with respect to each purchase or other acquisition made pursuant to
this Section 7.03(h) (each a "Permitted Acquisition"):
(i) any such newly-created or acquired Subsidiary shall comply
with the requirements of Section 6.12;
(ii) the lines of business of the Person to be (or the property
and assets of which are to be) so purchased or otherwise acquired
shall be reasonably related or similar to the same lines of business
as one or more of the principal businesses of the U.S. Borrower and
its Subsidiaries in the ordinary course (including, without
limitation, consumer products);
(iii) (A) the total cash and noncash consideration (excluding
the fair market value of all Equity Interests issued or transferred to
the sellers thereof but including all indemnities, earnouts and other
contingent payment obligations to, and the aggregate amounts paid or
to be paid under noncompete, consulting and other affiliated
agreements with, the sellers thereof, all write-downs of property and
assets and reserves for liabilities with respect thereto and all
assumptions of debt, liabilities and other obligations in connection
therewith) paid by or on behalf of the U.S. Borrower and its
Subsidiaries for any such purchase or other acquisition, when
aggregated with the total cash and noncash consideration (excluding
the fair market value of all Equity Interests issued or transferred to
the sellers thereof but including all indemnities, earnouts and other
contingent payment obligations to, and the aggregate amounts paid or
to be paid under noncompete, consulting and other affiliated
agreements with, the sellers thereof, all write-downs of property and
assets and reserves for liabilities with respect thereto and all
assumptions of debt, liabilities and other obligations in connection
therewith) paid by or on behalf of the U.S. Borrower and its
Subsidiaries for all other purchases and other acquisitions made by
the U.S. Borrower and its Subsidiaries pursuant to this Section
7.03(h), shall not exceed the aggregate of $700,000,000 plus 50% of
the amount of Excess Cash Flow for each fiscal year (commencing with
the fiscal year ended September 30, 2006) not required to be applied
to the prepayment of Loans pursuant to Section 2.07(b)(i) or (B) such
Investment is made solely with capital stock of the U.S. Borrower;
(iv) (A) immediately before and immediately after giving pro
forma effect to any such purchase or other acquisition, no Event of
Default shall have occurred and be continuing and (B) immediately
after giving effect to such purchase or other acquisition, the U.S.
Borrower and its Subsidiaries shall be in pro forma compliance with
all of the covenants set forth in Section 7.11, such compliance to be
determined on the basis of the financial information most recently
delivered to the Administrative Agent and the Lenders pursuant to
Section 6.01(a) or (b) as though such purchase or other acquisition
had been consummated as of the first day of the fiscal period covered
thereby; and
(v) the U.S. Borrower shall have delivered to the
Administrative Agent, on behalf of the Lenders, at least five Business
Days prior to the date on
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which any such purchase or other acquisition is to be consummated, a
certificate of a Responsible Officer, in form and substance reasonably
satisfactory to the Administrative Agent, certifying that all of the
requirements set forth in this clause (vi) have been satisfied or will
be satisfied on or prior to the consummation of such purchase or other
acquisition;
(i) Investments by the U.S. Borrower and its Subsidiaries not
otherwise permitted under this Section 7.03 in an aggregate amount not to
exceed $25,000,000; provided that, with respect to each Investment made
pursuant to this Section 7.03(i):
(i) such Investment shall be in property and assets that
are part of, or in lines of business that are, substantially the
same lines of business as one or more of the principal
businesses of the U.S. Borrower and its Subsidiaries in the
ordinary course;
(ii) any determination of the amount of such Investment
shall include all cash and noncash consideration (including the
fair market value of all Equity Interests issued or transferred
to the sellers thereof, all indemnities, earnouts and other
contingent payment obligations to, and the aggregate amounts
paid or to be paid under noncompete, consulting and other
affiliated agreements with, the sellers thereof, all write-downs
of property and assets and reserves for liabilities with respect
thereto and all assumptions of debt, liabilities and other
obligations in connection therewith) paid by or on behalf of the
U.S. Borrower and its Subsidiaries in connection with such
Investment; and
(iii) (A) immediately before and immediately after giving
pro forma effect to any such purchase or other acquisition, no
Event of Default shall have occurred and be continuing and (B)
immediately after giving effect to such purchase or other
acquisition, the U.S. Borrower and its Subsidiaries shall be in
pro forma compliance with all of the covenants set forth in
Section 7.11, such compliance to be determined on the basis of
the financial information most recently delivered to the
Administrative Agent and the Lenders pursuant to Section 6.01(a)
or (b) as though such Investment had been consummated as of the
first day of the fiscal period covered thereby;
(j) other Investments not exceeding $50,000,000 in the aggregate
during the term of this Agreement (with all such Investments valued at the
time of Investment at the cash amount thereof, if in cash, the fair market
value thereof as determined by the board of directors of the U.S.
Borrower, if in property, and at the maximum amount thereof if in
Guarantees); and
(k) bank deposits in the ordinary course of business.
(l) Investments related to the VARTA Exchange;
(m) Investments consisting of Restricted Payments permitted by
Section 7.06.
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(n) promissory notes and other non-cash consideration received in
connection with Dispositions permitted by Section 7.05;
(o) Investments in the ordinary course of business consisting of (i)
endorsements for collection or deposit and (ii) customary trade
arrangements with customers consistent with past practices;
(p) Investments (including debt obligations and Equity Interests)
received in connection with the bankruptcy or reorganization of any
Person and in settlement of obligations of, or other disputes with, such
Persons arising in the ordinary course of business and upon the
foreclosure with respect to any secured Investment or other transfer of
title with respect to any secured Investment; and
(q) advances of payroll payments to employees in the ordinary course
of business.
7.04 Fundamental Changes. Merge or consolidate with or into another
Person, or Dispose of (whether in one transaction or in a series of
transactions) all or substantially all of its assets (whether now owned or
hereafter acquired) to or in favor of any Person, except that, so long as no
Event of Default exists or would result therefrom:
(a) any Subsidiary (other than a Borrower) may merge with (i) the
U.S. Borrower, provided that the U.S. Borrower shall be the continuing or
surviving Person, except in connection with a merger the purpose of which
is to reorganize the U.S. Borrower into another state of the U.S. so long
as the surviving Person expressly assumes the obligations of the U.S.
Borrower in a manner reasonably satisfactory to the Administrative Agent,
or (ii) any one or more other Subsidiaries, provided that (i) when a
Wholly-Owned Subsidiary (other than an 80% Subsidiary) or Guarantor is
merging with another Subsidiary a Wholly-Owned Subsidiary (other than and
80% Subsidiary) or Guarantor, respectively shall be the continuing or
surviving person, (ii) when any Wholly-Owned Subsidiary that is not a
Guarantor is merging with a Guarantor, the Guarantor shall be the
continuing or surviving person and (iii) except in the case of a
transaction involving only foreign Subsidiaries, the continuing or
surviving Person shall not be a foreign Subsidiary;
(b) any Loan Party may Dispose of all or substantially all of its
assets (upon voluntary liquidation or otherwise) to a Borrower or to
another Loan Party;
(c) any Subsidiary that is not a Loan Party may dispose of all or
substantially all its assets to (i) another Subsidiary which is not a Loan
Party or (ii) to a Loan Party for no consideration, or, in the case of
this clause (ii), pursuant to a Disposition which is in the nature of a
liquidation;
(d) the U.S. Borrower and its Subsidiaries may consummate the Merger
and the transactions contemplated by the Merger Agreement; and
(e) in connection with any acquisition permitted under Section 7.03,
any Subsidiary of the U.S. Borrower may merge into or consolidate with any
other Person or
145
permit any other Person to merge into or consolidate with it; provided
that the Person surviving such merger shall be a Wholly-Owned Subsidiary
(but not an 80% Subsidiary) of the U.S. Borrower; and
(f) Dispositions of Dormant Subsidiaries;
provided, however, that in each case, immediately after giving effect
thereto (i) in the case of any such merger to which a Borrower is a party,
such Borrower is the surviving corporation (except as expressly provided
to the contrary in clause (a)(i) hereof) and (ii) in the case of any such
merger to which any Loan Party (other than a Borrower) is a party, such
Loan Party is the surviving corporation and provided further that
Borrowers shall not merge into each other.
7.05 Dispositions. Make any Disposition, except:
(a) Dispositions of no longer useful, used, surplus, obsolete or worn
out property, whether now owned or hereafter acquired, in the ordinary
course of business;
(b) Dispositions of inventory in the ordinary course of business;
(c) Dispositions of equipment or real property to the extent that (i)
such property is exchanged for credit against the purchase price of
similar replacement property or (ii) the proceeds of such Disposition are
reasonably promptly applied to the purchase price of such replacement
property;
(d) Dispositions of cash or Cash Equivalents;
(e) Dispositions of property by any Subsidiary (other than a
Borrower) to the U.S. Borrower or to a Wholly-Owned Subsidiary (but not an
80% Subsidiary); provided that if the transferor of such property is a
Guarantor (i) the transferee thereof must either be a Borrower or a
Guarantor or (ii) to the extent such transaction constitutes an
Investment, such transaction is permitted under Section 7.03;
(f) Dispositions permitted by Section 7.01, Section 7.04 and Section
7.06;
(g) The VARTA Exchange and related transactions;
(h) Dispositions by the U.S. Borrower and its Subsidiaries not
otherwise permitted under this Section 7.05; provided that (i) at the time
of such Disposition, no Event of Default shall exist or would result from
such Disposition, (ii) the aggregate book value of all property Disposed
of in reliance on this subsection (h) shall not exceed $35,000,000 in any
fiscal year or $100,000,000 during the term of this Agreement and (iii) at
least 75% of the purchase price for such asset shall be paid to the U.S.
Borrower or such Subsidiary in cash or Cash Equivalent consideration;
(i) Intentionally Omitted;
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(j) Dispositions by the Borrowers and their respective Subsidiaries
of property pursuant to sale-leaseback transactions; provided that (i) the
fair market value of all property so Disposed of shall not exceed
$25,000,000 from and after the Closing Date and (ii) the purchase price
for such property shall be paid to the U.S. Borrower or such Subsidiary
for not less than 75% cash or Cash Equivalent consideration;
(k) (i) sales or discounts of accounts receivable without recourse
arising in the ordinary course of business in connection with the
compromise or collection thereof and (ii) sales or transfers of accounts
receivable and related rights by any foreign Subsidiary (other than a
Subsidiary Borrower) pursuant to customary receivables financing
facilities or factoring arrangements;
(l) transfers of property subject to casualty or condemnation upon
receipt of the Net Cash Proceeds of such casualty or condemnation;
(m) Dispositions listed on Schedule 7.05(m);
(n) Dispositions of Investments in joint ventures, to the extent
required by, or made pursuant to buy/sell arrangements between the joint
venture parties forth in, joint venture arrangements and similar binding
arrangements in effect on the Closing Date; and
(o) Dispositions in the ordinary course of business consisting of
abandonment of IP Rights which, in the reasonable good faith determination
of the US Borrower or any Subsidiary, are uneconomical, negligible,
obsolete or otherwise not material in the conduct of its business and
which Disposition, in the aggregate, could not reasonably be expected to
have a Material Adverse Effect.
provided, however, that any Disposition pursuant to Section 7.05(a) through
(j), (k)(i) and (m) shall be for fair market value.
7.06 Restricted Payments. Declare or make, directly or indirectly, any
Restricted Payment except:
(a) each Subsidiary may make Restricted Payments to the Borrowers,
any Subsidiaries of the Borrowers that are Guarantors and any other Person
that owns a direct Equity Interest in such Subsidiary, ratably according
to their respective holdings of the type of Equity Interest in respect of
which such Restricted Payment is being made;
(b) each Borrower and each of its Subsidiaries may declare and make
dividend payments or other distributions payable solely in the common
stock or other common Equity Interests of such Person;
(c) the U.S. Borrower and each Subsidiary may purchase, redeem or
otherwise acquire of its common Equity Interests with the proceeds
received from the substantially concurrent issue of new common Equity
Interests;
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(d) So long as no Event of Default shall have occurred and be
continuing or would result therefrom, the U.S. Borrower or any of its
Subsidiaries may repurchase, retire or otherwise acquire or retire for
value common stock or options held with respect to common stock held by
future, present or former directors, officers, consultants, employees or
management of any Borrower or any of its Subsidiaries for the estate,
family members, spouse or former spouse of any of the foregoing, provided
that all such payments do not exceed $10,000,000 in the aggregate in any
calendar year and the price paid for any such common stock or options does
not exceed the market value of such common stock or options at the time
paid; provided further that such amount in any calendar year may be
increased by an amount not to exceed (i) the cash proceeds from the sale
of Equity Interests to directors, officers, members of management,
employees or consultants of the US Borrower or its Subsidiaries (or the
estate, family members, spouse or former spouse of any of the foregoing)
that occurs after the Closing Date plus (ii) the amount of any cash
bonuses otherwise payable to directors, officers, members of management,
employees or consultants of the US Borrower or its Subsidiaries in
connection with the Transaction that are foregone in return for the
receipt of Equity Interests of the US Borrower pursuant to a deferred
compensation plan of such Person less (iii) the amount of any Restricted
Payments previously made pursuant to clauses (i) and (ii) above;
(e) So long as no Event of Default shall have occurred and be
continuing or would result therefrom, the U.S. Borrower may repurchase
common stock (provided that (x) the price paid does not exceed the fair
market value of such common stock at the time paid and (y) any common
stock repurchased by the U.S. Borrower shall be immediately cancelled and
retired) and may make other Restricted Payments (determined at the time of
such Restricted Payment) in an aggregate amount, for all such repurchases
and other Restricted Payments, not exceeding $25,000,000 during the term
of this Agreement;
(f) So long as no Event of Default shall have occurred and be
continuing or would result therefrom, consideration paid in connection
with Investments in each of Ningbo Baowang Battery Company and Microlite
S.A or related to the VARTA Exchange, in the form of Restricted Payments
by such Subsidiary to the minority owner(s) of such Subsidiary;
(g) to the extent constituting Restricted Payments, the US Borrower
and its Subsidiaries may enter into transactions expressly permitted by
Section 7.04 or 7.05;
(h) So long as no Event of Default has occurred and is continuing or
would result therefrom, the proceeds of which shall be used solely to make
cash payments in lieu of issuing fractional shares in connection with the
exercise of warrants, options or other securities convertible into or
exchangeable for Equity Interests of the U.S. Borrower or its
Subsidiaries, provided that any such cash payment shall not be for the
purpose of evading the limitations set forth in this Section 7.06 (as
determined in good faith by the managing board or board of directors, as
the case may be, of the Borrower (or any authorized committee thereof).
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7.07 Change in Nature of Business. Engage in any material line of
business substantially different from those lines of business conducted by the
U.S. Borrower and its Subsidiaries on the date hereof or any business
reasonably related or ancillary thereto (including, without limitation,
consumer products).
7.08 Transactions with Affiliates. Enter into any transaction of any
kind with any Affiliate of the U.S. Borrower (other than portfolio companies of
THLee), whether or not in the ordinary course of business, other than (a) on
fair and reasonable terms substantially as favorable to the U.S. Borrower or
such Subsidiary as would be obtainable by the U.S. Borrower or such Subsidiary
at the time in a comparable arm's length transaction with a Person other than
an Affiliate, (b) transactions among Loan Parties, (c) the payment of fees and
expenses in connection with the consummation of the Transactions, (d)
dividends, redemptions, repurchases, and other transactions permitted under
Section 7.06, (e) customary fees payable to any directors of the U.S. Borrower
and its Subsidiaries and reimbursement of reasonable out of pocket costs of the
directors of the U.S. Borrower and its Subsidiaries, (f) employment and
severance arrangements between the US Borrower or its Subsidiaries and their
respective officers and employees in the ordinary course of business, (g) the
payment of customary fees and indemnities to directors, officers and employees
of the US Borrower and its Subsidiaries in the ordinary course of business, and
(h) transactions pursuant to permitted agreements in existence on the Closing
Date and set forth on Schedule 7.08 or any amendment thereto to the extent such
an amendment is not materially adverse to the Lenders in any respect.
7.09 Burdensome Agreements. Enter into or permit to exist any
Contractual Obligation (other than this Agreement or any other Loan Document)
that (a) limits the ability (i) of any Subsidiary to make Restricted Payments
to any Borrower or any Guarantor or to otherwise transfer property to or invest
in any Borrower or any Guarantor, except for any agreement in effect (A) on the
date hereof or (B) at the time any Subsidiary becomes a Subsidiary of the U.S.
Borrower, so long as such agreement was not entered into solely in
contemplation of such Person becoming a Subsidiary of the U.S. Borrower, (ii)
of any Subsidiary to Guarantee the Indebtedness of any Borrower or (iii) of any
Borrower or any Subsidiary to create, incur, assume or suffer to exist Liens on
property of such Person; provided, however, that this clause (iii) shall not
prohibit any negative pledge incurred or provided in favor of any holder of
Indebtedness permitted under Section 7.02(a), (c), (g), (j), (k) and (m) and
Section 7.02(e) solely to the extent any such negative pledge relates to the
property financed by or the subject of such Indebtedness; or (b) requires the
grant of a Lien to secure an obligation of such Person if a Lien is granted to
secure another obligation of such Person.
7.10 Use of Proceeds. Use the proceeds of any Credit Extension to
purchase or carry margin stock (within the meaning of Regulation U of the FRB)
or to extend credit to others for the purpose of purchasing or carrying margin
stock or to refund Indebtedness originally incurred for such purpose.
7.11 Financial Covenants.
(a) Consolidated Interest Coverage Ratio. Permit the Consolidated
Interest Coverage Ratio as of the end of any fiscal quarter of the U.S.
Borrower to be less than the ratio set forth below opposite such fiscal
quarter:
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---------------------------------------------------------------------
Minimum
Consolidated
Interest Coverage
Four Fiscal Quarters Ending Ratio
---------------------------------------------------------------------
Closing Date through June 30, 2006 2.25:1.00
---------------------------------------------------------------------
September 30, 2006 through June 30, 2007 2.50:1.00
---------------------------------------------------------------------
September 30, 2007 through June 30, 2008 3.00:1.00
---------------------------------------------------------------------
September 30, 2008 and each fiscal quarter 3.50:1.00
thereafter
---------------------------------------------------------------------
(b) Consolidated Leverage Ratio. Permit the Consolidated Leverage
Ratio at any time during any period of four fiscal quarters of the U.S.
Borrower set forth below to be greater than the ratio set forth below opposite
such period:
------------------------------------------------------------------
Maximum
Consolidated
Four Fiscal Quarters Ending Leverage Ratio
------------------------------------------------------------------
Closing Date through June 30, 2006 5.85:1.00
------------------------------------------------------------------
September 30, 2006 through June 30, 2007 5.00:1.00
------------------------------------------------------------------
September 30, 2007 through June 30, 2008 4.75:1.00
------------------------------------------------------------------
September 30, 2008 through June 30, 2009 4.25:1.00
------------------------------------------------------------------
September 30, 2009 and each fiscal quarter 3.75:1.00
thereafter
------------------------------------------------------------------
7.12 Capital Expenditures. Make any Capital Expenditure, except for
Permitted Acquisitions, Net Cash Proceeds reinvested pursuant to Section
2.07(b)(ii) and Capital Expenditures in the ordinary course of business not
exceeding, in the aggregate for the U.S. Borrower and it Subsidiaries during
each fiscal year, $75,000,000 and Capital Expenditures made during the fiscal
year ended September 30, 2005 in connection with the acquisition of the First
Trax pet business; provided, however, that so long as no Event of Default has
occurred and is continuing or would result from such expenditure, any portion
of such amount, if not expended in any fiscal year, may be carried over for
expenditure in the next two following fiscal years (such amount, the "Capital
Expenditure Carryover Amount").
7.13 Amendments of Organization Documents. Amend any of its
Organization Documents, except for any amendments that could not reasonably be
expected to have a Material Adverse Effect.
7.14 Accounting Changes. Make any change in (i) accounting policies or
reporting practices, except as required or permitted by GAAP, or (ii) fiscal
year.
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7.15 Prepayments, Etc. of Indebtedness. Prepay, redeem, purchase,
defease or otherwise satisfy prior to the scheduled maturity thereof in any
manner (it being understood that payments of regularly scheduled interest shall
be permitted), or make any payment in violation of any subordination terms of,
any subordinated Indebtedness, except regularly scheduled or required
repayments or redemptions of Indebtedness set forth on Schedule 7.02.
7.16 Amendment, Etc. of Related Documents and Indebtedness. (a) Amend,
modify or change in any materially adverse manner any term or condition of any
Related Document or give any consent, waiver or approval thereunder or (b)
amend, modify or change in any manner materially adverse to the interests of
the Loan Parties any term or condition of any Indebtedness set forth in
Schedule 7.02, except for any refinancing, refunding, renewal or extension
thereof permitted by Section 7.02.
7.17 Speculative Transactions. Engage, or permit any of its
Subsidiaries to engage, in any speculative transaction involving commodity
options or futures contracts or any similar speculative transactions, which
are, in any case, inconsistent with prior practice and not otherwise made in
the ordinary course of business.
7.18 Limitations on Finance Companies and Certain German Entities. (a)
in the case of Cayman Finance Co. and German Finance Co., to engage in any
business other than lending funds to ROV German Holding and VARTA AG,
respectively, (b) in the case of ROV German Holding, to engage in any business
other than holding stock of, and lending money to, its Subsidiaries, (c) in the
case of ROV GP GmbH, to engage in any business other than acting as general
partner of the Euro Borrower and lending money to VARTA AG pursuant to the
terms of the Acquisition Agreement dated July 28, 2002 among Varta AG and
certain Subsidiaries and (d) in the case of ROV LP GmbH, to engage in any
business other than acting as limited partner of the Euro Borrower.
Notwithstanding the foregoing, ROV German Holding, ROV GP GmbH and/or ROV LP
GmbH may own and license, as licensor, intellectual property.
7.19 Designation of Senior Debt. Designate any Indebtedness (other
than the Indebtedness under the Loan Documents) of the U.S. Borrower or any of
its Subsidiaries as "Designated Senior Debt" (or any similar term) under, and
as defined in, each of the 2013 Notes Indenture and the 2015 Notes Indenture.
7.20 Limitations of Undertakings. Notwithstanding the foregoing
provisions of Article VII (but without prejudice to any of the obligations
thereunder of any Loan Party not incorporated in Germany), the undertakings set
out in Article VI, Section 7.03 (Investments), 7.04 (Fundamental Changes), 7.05
(Dispositions), 7.07 (Change in Nature of Business), 7.08 (Transaction with
Affiliates), 7.13 (Amendments of Organization Documents) and 7.14 (Accounting
Changes) (the "Relevant Undertakings") are not and shall not be given by any
Loan Party incorporated in Germany (each a "German Loan Party"). However:
(a) each German Loan Party shall give to the Administrative Agent not
less than 20 Business Days' prior written notice if it or any of its
Subsidiaries proposes to take or permit any action or circumstance which, if
all the Relevant Undertakings had been given by that German Loan Party on the
date hereof and had thereafter remained in force, would constitute a breach of
any of the Relevant Undertakings;
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(b) the Administrative Agent shall be entitled, within ten Business
Days of receipt of notice under subsection (a) above, to request that the
German Loan Party supply to the Administrative Agent in sufficient copies for
the Lenders, such further relevant information as the Administrative Agent
(acting reasonably) may consider necessary for the purposes of this Section
7.20 (Limitation of Undertakings), and the German Loan Party shall supply such
further information promptly and in any event within ten Business Days of the
request therefore, subject to any relevant confidentiality obligations;
(c) if any Lender considers that the relevant action or circumstance
(taken alone or together with other actions or circumstances, whether or not
permitted hereunder), may have a Material Adverse Effect or materially and
adversely affects its interests as a Lender under the Loan Documents, it may so
notify the Administrative Agent in writing;
(d) if, by not later than the date ten Business Days after receipt by
the Administrative Agent of notice pursuant to subsection (a) above (or, if
later and additional information has been requested pursuant to subsection (b)
above, by not later than the date 10 Business Days after receipt by the
Administrative Agent of such additional information if received within the
prescribed time or the date 10 Business Days after the request therefore if
not) the Administrative Agent has received notices pursuant to subsection (c)
above from Lenders which constitute the Required Lenders, the Administrative
Agent shall promptly notify the Euro Borrower and the Lenders; and
(e) if the Administrative Agent gives notice to the Euro Borrower
pursuant to subsection (d) above or the relevant action is undertaken or
circumstance is permitted before the date two Business Days after the latest
time for the receipt by the Administrative Agent of notices pursuant to
subsection (d) above, the undertaking of the relevant action or permitting of
the relevant circumstances shall immediately constitute an Event of Default.
ARTICLE VIII
EVENTS OF DEFAULT AND REMEDIES
8.01 Events of Default. Any of the following shall constitute an Event
of Default:
(a) Non-Payment. The U.S. Borrower, any Subsidiary Borrower or any
other Loan Party fails to (i) pay when due, any amount of principal of any
Loan or deposit any funds or Backstop L/Cs as Cash Collateral in respect
of L/C Obligations, or (ii) pay within three days after the same becomes
due, any interest on any Loan or on any L/C Obligation, or any fee due
hereunder, or (iii) pay within five days after the same becomes due, any
other amount payable hereunder or under any other Loan Document; or
(b) Specific Covenants. Either Borrower fails to perform or observe
any term, covenant or agreement contained in any of Section 6.03(a) or
Article VII; or
(c) Other Defaults. Any Loan Party fails to perform or observe any
other covenant or agreement (not specified in Section 8.01(a) or (b)
above) contained in any Loan Document on its part to be performed or
observed and such failure continues for
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thirty (30) days after the date on which such Loan Party knew or should
have known of such failure; or
(d) Representations and Warranties. Any representation, warranty,
certification or statement of fact made or deemed made by or on behalf of
either Borrower or any other Loan Party herein, in any other Loan
Document, or in any document required to be delivered in connection
herewith or therewith shall be incorrect or misleading in any material
respect when made or deemed made; or
(e) Cross-Default. (i) Any Loan Party (A) fails to make any payment
when due (whether by scheduled maturity, required prepayment,
acceleration, demand, or otherwise) in respect of any Indebtedness (other
than Indebtedness hereunder) having an aggregate principal amount
(including undrawn committed or available amounts and including amounts
owing to all creditors under any combined or syndicated credit
arrangement) of more than the Threshold Amount and such failure shall
continue after the applicable grace period, or (B) fails to observe or
perform any other agreement or condition relating to any such Indebtedness
or contained in any instrument or agreement evidencing, securing or
relating thereto, or any other event occurs, the effect of which default
or other event is to cause, or to permit the holder or holders of such
Indebtedness to cause, after the applicable grace period, with the giving
of notice if required, such Indebtedness to be demanded or to become due
or to be repurchased, prepaid, defeased or redeemed (automatically or
otherwise), or an offer to repurchase, prepay, defease or redeem such
Indebtedness to be made, prior to its stated maturity; or (ii) there
occurs under any Swap Contract an Early Termination Date (as defined in
such Swap Contract) resulting from (A) any event of default under such
Swap Contract as to which the U.S. Borrower or any Subsidiary is the
Defaulting Party (as defined in such Swap Contract) or (B) any Termination
Event (as so defined) under such Swap Contract as to which the U.S.
Borrower or any Subsidiary is an Affected Party (as so defined) and, in
either event, the Swap Termination Value owed by the Loan Party or such
Subsidiary as a result thereof is greater than the Threshold Amount; or
(f) Insolvency Proceedings, Etc. (i) Any Loan Party or any of its
Subsidiaries (other than any Dormant Subsidiary) institutes or consents to
the institution of any proceeding under any Debtor Relief Law, or makes an
assignment for the benefit of creditors; or applies for or consents to the
appointment of any receiver, trustee, custodian, conservator, liquidator,
rehabilitator or similar officer for it or for all or any material part of
its property; or any receiver, trustee, custodian, conservator,
liquidator, rehabilitator or similar officer is appointed without the
application or consent of such Person and the appointment continues
undischarged or unstayed for sixty (60) calendar days; or any proceeding
under any Debtor Relief Law relating to any such Person or to all or any
material part of its property is instituted without the consent of such
Person and continues undismissed or unstayed for 60 calendar days, or an
order for relief is entered in any such proceeding; or (ii) in the case of
the UK Borrower or any of its Subsidiaries (other than Dormant
Subsidiaries), any corporate action, legal proceedings or other procedure
or step is taken in relation to:
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(A) the suspension of payments, a moratorium of any
indebtedness, winding up, dissolution, administration or
reorganisation (by way of voluntary arrangement scheme of arrangement
or otherwise) of the UK Borrower or any such Subsidiary other than a
solvent liquidation or reorganization;
(B) a composition, compromise, assignment or arrangement with
any creditor of the UK Borrower or any such Subsidiary;
(C) the appointment of a liquidator (other than in respect of a
solvent liquidation of the UK Borrower or any such Subsidiary)
receiver, administrative receiver, administrator, compulsory manager
or other similar officer in respect of the UK Borrower or any such
Subsidiary or any of its assets; or
(D) enforcement of any Lien over any assets of the UK Borrower
or any such Subsidiary;
(E) any winding up petition presented by a creditor (other than
a petition which is frivolous or vexatious and is contested in good
faith and with diligence and is discharged, stayed or dismissed within
14 days of commencement or, if earlier, the date on which it is
advertised); or
(g) Inability to Pay Debts; Attachment. (i) Any Loan Party or any of
its Subsidiaries (other than any Dormant Subsidiary) becomes unable or
admits in writing its inability or fails generally to pay its debts as
they become due, or (ii) any writ or warrant of attachment or execution or
similar process is issued or levied against all or any material part of
the property of any such Person and is not released, vacated or fully
bonded within 30 days after its issue or levy; or
(h) Judgments. There is entered against any Loan Party or any of its
Subsidiaries a final judgment or order for the payment of money in an
aggregate amount exceeding the Threshold Amount (to the extent not covered
by independent third-party insurance as to which the insurer has been
notified of the potential claim and does not dispute coverage), (i)
enforcement proceedings are commenced by any creditor upon such judgment
or order, or (ii) there is a period of forty-five (45) consecutive days
during which a stay of enforcement of such judgment, by reason of a
pending appeal or otherwise, is not in effect; or
(i) ERISA. (i) An ERISA Event occurs with respect to a Foreign Plan,
Pension Plan or Multiemployer Plan which has resulted or could reasonably
be expected to result in liability of the U.S. Borrower under Title IV of
ERISA to the Pension Plan, Multiemployer Plan or the PBGC, or similar
liabilities of any Loan Party under a Foreign Plan, in each case which
could reasonably be expected to have a Material Adverse Effect, or (ii)
the U.S. Borrower or any ERISA Affiliate fails to pay when due, after the
expiration of any applicable grace period, any installment payment with
respect to its withdrawal liability under Section 4201 of ERISA under a
Multiemployer Plan, or a similar event occurs with respect to any Foreign
Plan, in each case which could reasonably be expected to have a Material
Adverse Effect; or
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(j) Invalidity of Loan Documents. Any material provision of any Loan
Document, at any time after its execution and delivery and for any reason
other than as expressly permitted hereunder or thereunder, including as a
result of a transaction permitted under Section 7.04 or Section 7.05, or
satisfaction in full of all the Obligations, ceases to be in full force
and effect; or any Loan Party or any other Person contests in any manner
the validity or enforceability of any provision of any Loan Document; or
any Loan Party denies that it has any or further liability or obligation
under any provision of any Loan Document, or purports to revoke, terminate
or rescind any provision of any Loan Document; or
(k) Change of Control. There occurs any Change of Control; or
(l) Collateral Document. Any Collateral Document after delivery
thereof pursuant to Section 4.01 or 6.12 shall for any reason (other than
pursuant to the terms thereof, including as a result of a transaction
permitted under Section 7.04 or Section 7.05) cease to create a valid and
perfected first priority lien on and security interest in the Collateral
purported to be covered thereby.
8.02 Remedies Upon Event of Default. If any Event of Default occurs
and is continuing, the Administrative Agent shall, at the request of, or may,
with the consent of, the Required Lenders, take any or all of the following
actions:
(a) declare the Commitment of each Lender to make Loans and any
obligation of the L/C Issuer to make L/C Credit Extensions to be
terminated, whereupon such Commitments and obligation shall be terminated;
(b) declare the unpaid principal amount of all outstanding Loans, all
interest accrued and unpaid thereon, and all other amounts owing or
payable hereunder or under any other Loan Document to be immediately due
and payable, without presentment, demand, protest or other notice of any
kind, all of which are hereby expressly waived by the Borrowers;
(c) require that the Borrowers Cash Collateralize the L/C Obligations
(in an amount equal to the then Outstanding Amount thereof); and
(d) exercise on behalf of itself and the Lenders all rights and
remedies available to it and the Lenders under the Loan Documents;
provided, however, that upon the occurrence of an actual or deemed entry of an
order for relief under the Bankruptcy Code of the United States with respect to
the U.S. Borrower, or under any Debtor Relief Law with respect to any other
Borrower, the obligation of each Lender to make Loans and any obligation of the
L/C Issuer to make L/C Credit Extensions shall automatically terminate, the
unpaid principal amount of all outstanding Loans and all interest and other
amounts as aforesaid shall automatically become due and payable, and the
obligation of the Borrowers to Cash Collateralize the L/C Obligations as
aforesaid shall automatically become effective, in each case without further
act of the Administrative Agent or any Lender.
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8.03 Application of Funds. After the exercise of remedies provided for
in Section 8.02 (or after the Loans have automatically become immediately due
and payable and the L/C Obligations have automatically been required to be Cash
Collateralized as set forth in the proviso to Section 8.02), or after payment
of any amounts received pursuant to Section 2.14(f), any amounts received on
account of the Obligations shall be applied by the Administrative Agent in the
following order:
First, to payment of that portion of the Obligations constituting
fees, indemnities, expenses and other amounts (including reasonable fees,
charges and disbursements of counsel to the Administrative Agent payable
under Section 10.04(a) and amounts payable under Article III) payable to
the Administrative Agent in its capacity as such;
Second, to payment of that portion of the Obligations constituting
fees (including commitment fees), indemnities and other amounts (other
than principal, interest and Letter of Credit Fees) payable to the Lenders
and the L/C Issuer (including reasonable fees, charges and disbursements
of counsel to the respective Lenders and the L/C Issuer payable under
Section 10.04(b)) and amounts payable under Article III, ratably among
them in proportion to the respective amounts described in this clause
Second payable to them;
Third, to payment of that portion of the Obligations constituting
accrued and unpaid Letter of Credit Fees and interest on the Loans, L/C
Borrowings and other Obligations, ratably among the Lenders and the L/C
Issuer in proportion to the respective amounts described in this clause
Third payable to them;
Fourth, to payment of that portion of the Obligations constituting
unpaid principal of the Loans, L/C Borrowings, amounts owing under Secured
Hedge Agreements, and amounts owing under Qualified Foreign Credit
Facilities, ratably among the Lenders, the L/C Issuer, the Hedge Banks and
the Qualified Foreign Lenders in proportion to the respective amounts
described in this clause Fourth held by them;
Fifth, to the Administrative Agent for the account of the L/C Issuer,
to Cash Collateralize that portion of L/C Obligations comprised of the
aggregate undrawn amount of Letters of Credit;
Sixth, to the payment of all other Obligations of the Loan Parties
owing under or in respect of the Loan Documents that are due and payable
to the Administrative Agent and the other Secured Parties on such date,
ratably based upon the respective aggregate amounts of all such
Obligations owing to the Administrative Agent and the other Secured
Parties on such date; and
Last, the balance, if any, after all of the Obligations have been
indefeasibly paid in full, to the U.S. Borrower or as otherwise required
by Law.
Subject to Section 2.03(c), amounts used to Cash Collateralize the aggregate
undrawn amount of Letters of Credit pursuant to clause Fifth above shall be
applied to satisfy drawings under such Letters of Credit as they occur. If any
amount remains on deposit as Cash Collateral after all Letters of Credit have
either been fully drawn or expired, such remaining amount shall be
156
applied to the other Obligations, if any, in the order set forth above, and, if
no Obligations remain outstanding, delivered to the Borrowers.
ARTICLE IX
ADMINISTRATIVE AGENT
9.01 Appointment and Authority.
(a) Each of the Lenders and the L/C Issuer hereby irrevocably
appoints Bank of America to act on its behalf as the Administrative Agent
hereunder and under the other Loan Documents and authorizes the Administrative
Agent to take such actions on its behalf and to exercise such powers as are
delegated to the Administrative Agent by the terms hereof or thereof, together
with such actions and powers as are reasonably incidental thereto. The
provisions of this Article (excluding Section 9.07 and 9.13) are solely for the
benefit of the Administrative Agent, the Lenders and the L/C Issuer, and none
of the Borrowers or any other Loan Party shall have rights as a third party
beneficiary of any of such provisions.
(b) The Administrative Agent shall also act as the "collateral agent"
under the Loan Documents, and each of the Lenders (in its capacities as a
Lender or Swing Line Lender (if applicable) and potential Hedge Bank) and the
L/C Issuer hereby irrevocably appoints and authorizes the Administrative Agent
to act as the agent of such Lender and the L/C Issuer for purposes of
acquiring, holding and enforcing any and all Liens on Collateral granted by any
of the Loan Parties to secure any of the Secured Obligations, together with
such powers and discretion as are reasonably incidental thereto. In this
connection, the Administrative Agent, as "collateral agent," and any co-agents,
sub-agents and attorneys-in-fact appointed by the Administrative Agent pursuant
to Section 9.06 for purposes of holding or enforcing any Lien on the Collateral
(or any portion thereof) granted under the Collateral Documents, or for
exercising any rights and remedies thereunder at the direction of the
Administrative Agent), shall be entitled to the benefits of all provisions of
this Article IX and Article X (including Section 10.04(c), as though such
co-agents, sub-agents and attorneys-in-fact were the "collateral agent" under
the Loan Documents) as if set forth in full herein with respect thereto.
(c) The Administrative Agent shall be released from the restrictions
of Section 181 of the German Civil Code (Burgerliches Gesetzbuch, BGB).
9.02 Power of Attorney for German Collateral Agreements to the
Administrative Agent in its capacity as "collateral agent".
(a) Each of the Lenders and the L/C Issuer hereby irrevocably authorizes the
Administrative Agent to act on its behalf and, if required under applicable Law
or if otherwise appropriate, in its name in connection with the preparation,
entering into, execution and delivery of each German Collateral Agreement and
the perfection and monitoring of each security interest granted under any
German Collateral Agreement (a "German Security Interest"), including, but not
limited to, any share pledge agreement with respect to shares in any German
company in notarial or private written form, as well as any other pledge,
mortgage, assignment or transfer of title for security purposes. The
Administrative Agent shall be authorized to make all statements, make and
receive any and all declarations and take any and all action necessary or
appropriate in
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this connection. The Administrative Agent shall be authorized to delegate this
power of attorney.
(b) The Administrative Agent shall: (i) hold such German Security
Interest, if any, which is transferred or assigned by way of security
(Sicherungsubereignung / Sicherungsabtretung) or otherwise granted under a
non-accessory security right (nicht akzessorische Sicherheit) as trustee
(Treuhander) for the benefit of the Lender Parties; and (ii) administer in the
name and on behalf of the Lender Parties such German Security Interest which is
pledged (Verpfandung) or otherwise transferred under an accessory security
right (akzessorische Sicherheit) to the Administrative Agent and the other
Lender Parties.
(c) It is hereby agreed that, in relation to any jurisdiction the
courts of which would not recognize or give effect to the trust (Treuhand)
expressed to be created by this Section 9.02, the relationship of the Lenders
and the L/C Issuer to the Administrative Agent in relation to any Lien or
security interest governed by German law shall be construed as one of principal
and agent but, to the extent permissible under the laws of such jurisdiction,
all the other provisions of this Section 9.02 shall have full force and effect
between the parties hereto.
9.03 Rights as a Lender. The Person serving as the Administrative
Agent hereunder shall have the same rights and powers in its capacity as a
Lender as any other Lender and may exercise the same as though it were not the
Administrative Agent and the term "Lender" or "Lenders" shall, unless otherwise
expressly indicated or unless the context otherwise requires, include the
Person serving as the Administrative Agent hereunder in its individual
capacity. Such Person and its Affiliates may accept deposits from, lend money
to, act as the financial advisor or in any other advisory capacity for and
generally engage in any kind of business with either Borrower or any Subsidiary
or other Affiliate thereof as if such Person were not the Administrative Agent
hereunder and without any duty to account therefor to the Lenders.
9.04 Exculpatory Provisions. The Administrative Agent shall not have
any duties or obligations except those expressly set forth herein and in the
other Loan Documents. Without limiting the generality of the foregoing, the
Administrative Agent:
(a) shall not be subject to any fiduciary or other implied duties,
regardless of whether a Default has occurred and is continuing;
(b) shall not have any duty to take any discretionary action or
exercise any discretionary powers, except discretionary rights and powers
expressly contemplated hereby or by the other Loan Documents that the
Administrative Agent is required to exercise as directed in writing by the
Required Lenders (or such other number or percentage of the Lenders as
shall be expressly provided for herein or in the other Loan Documents),
provided that the Administrative Agent shall not be required to take any
action that, in its opinion or the opinion of its counsel, may expose the
Administrative Agent to liability or that is contrary to any Loan Document
or applicable Law; and
(c) shall not, except as expressly set forth herein and in the other
Loan Documents, have any duty to disclose, and shall not be liable for the
failure to disclose, any information relating to the Borrowers or any of
their Affiliates that is communicated
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to or obtained by the Person serving as the Administrative Agent or any of
its Affiliates in any capacity.
The Administrative Agent shall not be liable for any action taken or
not taken by it (i) with the consent or at the request of the Required Lenders
(or such other number or percentage of the Lenders as shall be necessary, or as
the Administrative Agent shall believe in good faith shall be necessary, under
the circumstances as provided in Sections 10.01 and 8.02) or (ii) in the
absence of its own gross negligence or willful misconduct. The Administrative
Agent shall be deemed not to have knowledge of any Default unless and until
notice describing such Default is given to the Administrative Agent by a
Borrower, a Lender or the L/C Issuer.
The Administrative Agent shall not be responsible for or have any duty
to ascertain or inquire into (i) any statement, warranty or representation made
in or in connection with this Agreement or any other Loan Document, (ii) the
contents of any certificate, report or other document delivered hereunder or
thereunder or in connection herewith or therewith, (iii) the performance or
observance of any of the covenants, agreements or other terms or conditions set
forth herein or therein or the occurrence of any Default, (iv) the validity,
enforceability, effectiveness or genuineness of this Agreement, any other Loan
Document or any other agreement, instrument or document, or the creation,
perfection or priority of any Lien purported to be created by the Collateral
Documents, (v) the value or sufficiency of any Collateral or (vi) the
satisfaction of any condition set forth in Article IV or elsewhere herein,
other than to confirm receipt of items expressly required to be delivered to
the Administrative Agent.
9.05 Reliance by Administrative Agent. The Administrative Agent shall
be entitled to rely upon, and shall not incur any liability for relying upon,
any notice, request, certificate, consent, statement, instrument, document or
other writing (including any electronic message, Internet or intranet website
posting or other distribution) believed by it to be genuine and to have been
signed, sent or otherwise authenticated by the proper Person. The
Administrative Agent also may rely upon any statement made to it orally or by
telephone and believed by it to have been made by the proper Person, and shall
not incur any liability for relying thereon. In determining compliance with any
condition hereunder to the making of a Loan, or the issuance of a Letter of
Credit, that by its terms must be fulfilled to the satisfaction of a Lender or
the L/C Issuer, the Administrative Agent may presume that such condition is
satisfactory to such Lender or the L/C Issuer unless the Administrative Agent
shall have received notice to the contrary from such Lender or the L/C Issuer
prior to the making of such Loan or the issuance of such Letter of Credit. The
Administrative Agent may consult with legal counsel (who may be counsel for the
Borrowers), independent accountants and other experts selected by it, and shall
not be liable for any action taken or not taken by it in accordance with the
advice of any such counsel, accountants or experts.
9.06 Delegation of Duties. The Administrative Agent may perform any
and all of its duties and exercise its rights and powers hereunder or under any
other Loan Document by or through any one or more sub-agents appointed by the
Administrative Agent. The Administrative Agent and any such sub-agent may
perform any and all of its duties and exercise its rights and powers by or
through their respective Related Parties. The exculpatory provisions of this
Article shall apply to any such sub-agent and to the Related Parties of the
Administrative
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Agent and any such sub-agent, and shall apply to their respective activities in
connection with the syndication of the credit facilities provided for herein as
well as activities as Administrative Agent.
9.07 Resignation of Administrative Agent. The Administrative Agent may
at any time give notice of its resignation to the Lenders, the L/C Issuer and
the Borrowers. Upon receipt of any such notice of resignation, the Required
Lenders shall have the right, in consultation with the Borrowers, to appoint a
successor, which shall be a bank with an office in the United States, or an
Affiliate of any such bank with an office in the United States. If no such
successor shall have been so appointed by the Required Lenders and shall have
accepted such appointment within 30 days after the retiring Administrative
Agent gives notice of its resignation, then the retiring Administrative Agent
may on behalf of the Lenders and the L/C Issuer, appoint a successor
Administrative Agent meeting the qualifications set forth above; provided that
if the Administrative Agent shall notify the Borrowers and the Lenders that no
qualifying Person has accepted such appointment, then such resignation shall
nonetheless become effective in accordance with such notice and (a) the
retiring Administrative Agent shall be discharged from its duties and
obligations hereunder and under the other Loan Documents and (b) all payments,
communications and determinations provided to be made by, to or through the
Administrative Agent shall instead be made by or to each Lender and the L/C
Issuer directly, until such time as the Required Lenders appoint a successor
Administrative Agent as provided for above in this Section. Upon the acceptance
of a successor's appointment as Administrative Agent hereunder, such successor
shall succeed to and become vested with all of the rights, powers, privileges
and duties of the retiring (or retired) Administrative Agent, and the retiring
Administrative Agent shall be discharged from all of its duties and obligations
hereunder or under the other Loan Documents (if not already discharged
therefrom as provided above in this Section). The fees payable by the Borrowers
to a successor Administrative Agent shall be the same as those payable to its
predecessor unless otherwise agreed between the Borrowers and such successor.
After the retiring Administrative Agent's resignation hereunder and under the
other Loan Documents, the provisions of this Article and Section 10.04 shall
continue in effect for the benefit of such retiring Administrative Agent, its
sub-agents and their respective Related Parties in respect of any actions taken
or omitted to be taken by any of them while the retiring Administrative Agent
was acting as Administrative Agent.
Any resignation by Bank of America as Administrative Agent pursuant to
this Section shall also constitute its resignation as L/C Issuer and Swing Line
Lender. Upon the acceptance of a successor's appointment as Administrative
Agent hereunder, (i) such successor shall succeed to and become vested with all
of the rights, powers, privileges and duties of the retiring L/C Issuer and
Swing Line Lender, (ii) the retiring L/C Issuer and Swing Line Lender shall be
discharged from all of their respective duties and obligations hereunder or
under the other Loan Documents, and (iii) the successor L/C Issuer shall issue
letters of credit in substitution for the Letters of Credit, if any,
outstanding at the time of such succession or make other arrangement
satisfactory to the retiring L/C Issuer to effectively assume the obligations
of the retiring L/C Issuer with respect to such Letters of Credit.
9.08 Non-Reliance on Administrative Agent and Other Lenders. Each
Lender and the L/C Issuer acknowledges that it has, independently and without
reliance upon the Administrative Agent or any other Lender or any of their
Related Parties and based on such
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documents and information as it has deemed appropriate, made its own credit
analysis and decision to enter into this Agreement. Each Lender and the L/C
Issuer also acknowledges that it will, independently and without reliance upon
the Administrative Agent or any other Lender or any of their Related Parties
and based on such documents and information as it shall from time to time deem
appropriate, continue to make its own decisions in taking or not taking action
under or based upon this Agreement, any other Loan Document or any related
agreement or any document furnished hereunder or thereunder.
9.09 No Other Duties, Etc. Anything herein to the contrary
notwithstanding, none of the Book Managers, Arrangers, Documentation Agents,
Syndication Agents or Managing Agents listed on the cover page hereof shall
have any powers, duties or responsibilities under this Agreement or any of the
other Loan Documents, except in its capacity, as applicable, as the
Administrative Agent, a Lender or the L/C Issuer hereunder.
9.10 Administrative Agent May File Proofs of Claim. In case of the
pendency of any receivership, insolvency, liquidation, bankruptcy,
reorganization, arrangement, adjustment, composition or other judicial
proceeding relative to any Loan Party, the Administrative Agent (irrespective
of whether the principal of any Loan or L/C Obligation shall then be due and
payable as herein expressed or by declaration or otherwise and irrespective of
whether the Administrative Agent shall have made any demand on a Borrower)
shall be entitled and empowered, by intervention in such proceeding or
otherwise
(a) to file and prove a claim for the whole amount of the principal
and interest owing and unpaid in respect of the Loans, L/C Obligations and
all other Obligations that are owing and unpaid and to file such other
documents as may be necessary or advisable in order to have the claims of
the Lenders, the L/C Issuer and the Administrative Agent (including any
claim for the reasonable compensation, expenses, disbursements and
advances of the Lenders, the L/C Issuer and the Administrative Agent and
their respective agents and counsel and all other amounts due the Lenders
and the Administrative Agent under Sections 2.03(i) and (j), 2.04(i) and
(j), 2.05(i) and (j), 2.11 and 10.04) allowed in such judicial proceeding;
and
(b) to collect and receive any monies or other property payable or
deliverable on any such claims and to distribute the same;
and any custodian, receiver, assignee, trustee, liquidator, sequestrator or
other similar official in any such judicial proceeding is hereby authorized by
each Lender and the L/C Issuer to make such payments to the Administrative
Agent and, if the Administrative Agent shall consent to the making of such
payments directly to the Lenders and the L/C Issuer, to pay to the
Administrative Agent any amount due for the reasonable compensation, expenses,
disbursements and advances of the Administrative Agent and its respective
agents and counsel, and any other amounts due the Administrative Agent under
Sections 2.11 and 10.04.
Nothing contained herein shall be deemed to authorize the
Administrative Agent to authorize or consent to or accept or adopt on behalf of
any Lender any plan of reorganization, arrangement, adjustment or composition
affecting the Obligations or the rights of any Lender or
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the L/C Issuer or to authorize the Administrative Agent to vote in respect of
the claim of any Lender in any such proceeding.
9.11 Collateral and Guaranty Matters. The Lenders and the L/C Issuer
irrevocably authorize the Administrative Agent, at its option and in its
discretion,
(a) to release any Lien on any property granted to or held by the
Administrative Agent under any Loan Document (i) upon termination of the
Aggregate Commitments and payment in full of all Obligations (other than
contingent indemnification obligations) and the expiration or termination
of all Letters of Credit, (ii) that is sold or to be sold as part of or in
connection with any sale permitted hereunder or under any other Loan
Document, or (iii) if approved, authorized or ratified in writing in
accordance with Section 10.01 hereof;
(b) to release any Guarantor from its obligations under the ROV
Guaranty, the KGaA Guaranty or the UK Guaranty if such Person ceases to be
a Subsidiary as a result of a transaction permitted hereunder; and
(c) to subordinate any Lien on any property granted to or held by the
Administrative Agent under any Loan Document to the holder of any Lien on
such property that is permitted by Section 7.01(i).
Upon request by the Administrative Agent at any time, the Required
Lenders will confirm in writing the Administrative Agent's authority to release
its interest in particular types or items of property, or to release any
Guarantor from its obligations under the ROV Guaranty, the KGaA Guaranty or the
UK Guaranty pursuant to this Section 9.11. In each case as specified in this
Section 9.11, the Administrative Agent will, at the Borrowers' expense, execute
and deliver to the applicable Loan Party such documents as such Loan Party may
reasonably request to evidence the release of such item of Collateral from the
assignment and security interest granted under the Collateral Documents, or to
release such Guarantor from its obligations under the ROV Guaranty, the KGaA
Guaranty or the UK Guaranty, in each case in accordance with the terms of the
Loan Documents and this Section 9.11.
9.12 Appointment of Supplemental Collateral Agents.
(a) It is the purpose of this Agreement and the other Loan Documents
that there shall be no violation of any Law of any jurisdiction denying or
restricting the right of banking corporations or associations to transact
business as agent or trustee in such jurisdiction. It is recognized that in
case of litigation under this Agreement or any of the other Loan Documents, and
in particular in case of the enforcement of any of the Loan Documents, or in
case the Administrative Agent deems that by reason of any present or future Law
of any jurisdiction it may not exercise any of the rights, powers or remedies
granted herein or in any of the other Loan Documents or take any other action
which may be desirable or necessary in connection therewith, it may be
necessary that the Administrative Agent appoint an additional individual or
institution as a separate trustee, co-trustee, collateral agent, collateral
sub-agent or collateral co-agent (any such additional individual or institution
being referred to herein
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individually as a "Supplemental Collateral Agent" and collectively as
"Supplemental Collateral Agents").
(b) In the event that the Administrative Agent appoints a
Supplemental Collateral Agent with respect to any Collateral, (i) each and
every right, power, privilege or duty expressed or intended by this Agreement
or any of the other Loan Documents to be exercised by or vested in or conveyed
to the Administrative Agent with respect to such Collateral shall be
exercisable by and vest in such Supplemental Collateral Agent to the extent,
and only to the extent, necessary to enable such Supplemental Collateral Agent
to exercise such rights, powers and privileges with respect to such Collateral
and to perform such duties with respect to such Collateral, and every covenant
and obligation contained in the Loan Documents and necessary to the exercise or
performance thereof by such Supplemental Collateral Agent shall run to and be
enforceable by either the Administrative Agent or such Supplemental Collateral
Agent, and (ii) the provisions of this Article and of Section 10.04 that refer
to the Administrative Agent shall inure to the benefit of such Supplemental
Collateral Agent and all references therein to the Administrative Agent shall
be deemed to be references to the Administrative Agent and/or such Supplemental
Collateral Agent, as the context may require.
(c) Should any instrument in writing from any Loan Party be required
by any Supplemental Collateral Agent so appointed by the Administrative Agent
for more fully and certainly vesting in and confirming to him or it such
rights, powers, privileges and duties, such Loan Party shall execute,
acknowledge and deliver any and all such instruments promptly upon request by
the Administrative Agent. In case any Supplemental Collateral Agent, or a
successor thereto, shall die, become incapable of acting, resign or be removed,
all the rights, powers, privileges and duties of such Supplemental Collateral
Agent, to the extent permitted by Law, shall vest in and be exercised by the
Administrative Agent until the appointment of a new Supplemental Collateral
Agent.
9.13 Abstract Acknowledgement of Indebtedness/Joint Creditorship.
(a) Subject to Section 10.09 hereof, each of the parties hereto
agree, and each of the Euro Borrower and the KGaA Guarantors acknowledges by
way of an abstract acknowledgement of indebtedness (abstraktes
Schuldanerkenntnis), that each and every obligation of the Euro Borrower and
each KGaA Guarantor (and any of its successors), up to the aggregate amount of
(euro)25 million under this Credit Agreement and the other Loan Documents shall
also be owing in full to the Administrative Agent, and that accordingly the
Administrative Agent will have its own independent right to demand performance
by the Euro Borrower and/or each KGaA Guarantor of such obligations (the
"Acknowledgement I").
(b) Each of the parties hereto agree, and each of the U.S. Borrower
and the ROV Guarantors acknowledges by way of an abstract acknowledgement of
indebtedness (abstraktes Schuldanerkenntnis), that each and every obligation of
the U.S. Borrower and each ROV Guarantor (and any of its successors), up to the
aggregate amount of U.S. $1.0 billion under this Credit Agreement and the other
Loan Documents shall also be owing in full to the Administrative Agent, and
that accordingly the Administrative Agent will have its own independent right
to demand performance by the U.S. Borrower and/or each ROV Guarantor of such
obligations (the "Acknowledgement II").
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(c) Each of the parties hereto agree, and each of the U.K. Borrower
and the U.K. Guarantors acknowledges by way of an abstract acknowledgement of
indebtedness (abstraktes Schuldanerkenntnis), that each and every obligation of
the U.K. Borrower and each U.K. Guarantor (and any of its successors), up to
the aggregate amount of (pound)10,000,000 under this Credit Agreement and the
other Loan Documents shall also be owing in full to the Administrative Agent,
and that accordingly the Administrative Agent will have its own independent
right to demand performance by the U.K. Borrower and/or each U.K. Guarantor of
such obligations (the "Acknowledgement III").
The Acknowledgement I, the Acknowledgement II and the Acknowledgement
III are collectively referred to as the "Acknowledgements" and each an
"Acknowledgement".
(d) The Administrative Agent undertakes with the relevant Loan Party
that (i) in case of any discharge of any obligation owing to any Lender, the
Administrative Agent will not, to the extent of such discharge, make a claim
against such Loan Party under the relevant Acknowledgement and (ii) it will
not, at any time, make any claim against any Loan Party exceeding the amount
then owed by such Loan Party under the Loan Documents.
(c) (i) Each Loan Party hereby irrevocably and unconditionally
undertakes to pay to the Administrative Agent, as creditor in its own right and
not as representative of the other Lenders, sums equal to and in the currency
of each amount payable by such Loan Party to each of the Lenders under each of
the Loan Documents as and when that amount falls due for payment under the
relevant Loan Document. (ii) Each of the Loan Parties and each of the Lenders
(other than the Administrative Agent) agrees that the Administrative Agent
shall be the joint creditor (together with the relevant Lenders) of each and
every obligation of any Loan Party towards each of the Lenders (other than the
Administrative Agent) under the Loan Documents. Accordingly the Administrative
Agent will have its own independent right to demand performance by the relevant
Loan Party of those obligations irrespective of any discharge of such Loan
Party's obligation to pay those amounts to the other Lenders resulting from
failure by them to take appropriate steps in an insolvency proceeding of that
Loan Party to preserve their entitlement to be paid those amounts. However, any
discharge of any such obligation to either the Administrative Agent or a Lender
(other than the Administrative Agent) shall, to that extent, discharge the
corresponding obligation owing to the other. (iii) Without limiting or
affecting the Administrative Agent's rights against any Loan Party (whether
under this paragraph or under any other provision of the Loan Documents), the
Administrative Agent agrees with each other Lender (on a several and divided
basis) that, subject as set out in the next sentence, it will not exercise its
rights as a joint creditor with a Lender (other than the Administrative Agent)
except with the consent of the relevant Lender. However, for the avoidance of
doubt, nothing in the previous sentence shall in any way limit the
Administrative Agent's right to act in the protection or preservation of rights
under, or to enforce any Collateral Document as contemplated by, this deed
and/or the relevant Collateral Document (or to do any act reasonably incidental
to any of the foregoing).
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ARTICLE X
MISCELLANEOUS
10.01 Amendments, Etc. No amendment or waiver of any provision of this
Agreement or any other Loan Document, and no consent to any departure by either
Borrower or any other Loan Party therefrom, shall be effective unless in
writing signed by the Required Lenders and applicable Borrower or the
applicable Loan Party, as the case may be, and acknowledged by the
Administrative Agent, and each such waiver or consent shall be effective only
in the specific instance and for the specific purpose for which given;
provided, however, that no such amendment, waiver or consent shall:
(a) waive any condition set forth in Section 4.01(a), or, in the case
of the initial Credit Extension, Section 4.02, without the written consent
of each Lender;
(b) extend or increase the Commitment of any Lender (it being
understood that a waiver of any condition or precedent set forth in
Section 4.02, or waiver of any Default or Event of Default, mandatory
prepayment or mandatory reduction of the Commitments shall not constitute
an extension or increase of any commitment of any Lender) without the
written consent of each Lender directly affected thereby;
(c) postpone any date fixed for any payment of principal under
Section 2.09, interest under Section 2.10, or fees under Sections 2.03(i)
and (j), 2.04(i) and (j), 2.05(i) and (j), 2.11(a) or 2.11(b) without the
written consent of each Lender directly affected thereby (it being
understood that the waiver of mandatory prepayments of the Term Loans
shall not constitute a postponement of any date fixed for the payment of
principal or interest);
(d) reduce the principal of, or the rate of interest specified herein
on, any Loan or L/C Borrowing, or (subject to clause (v) of the second
proviso to this Section 10.01) any fees or other amounts payable hereunder
or under any other Loan Document without the written consent of each
Lender entitled to such amount; provided, however, that only the consent
of the Required Lenders shall be necessary (i) to amend the definition of
"Default Rate" or to waive any obligation of either Borrower to pay
interest or Letter of Credit Fees at the Default Rate or (ii) to amend any
financial covenant hereunder (or any defined term used therein) even if
the effect of such amendment would be to reduce the rate of interest on
any Loan or L/C Borrowing or to reduce any fee payable hereunder;
(e) change (i) Section 8.03 in a manner that would alter the pro rata
sharing of payments required thereby without the prior written consent of
each Lender or (ii) the order of application of any reduction in the
Commitments or any prepayment of Loans among the Facilities from the
application thereof set forth in the applicable provisions of Section
2.07(b) or 2.08(b), respectively, in any manner that materially and
adversely affects the Lenders under a Facility without the written consent
of (i) if such Facility is the Revolving Credit Facility, the Required
Revolving Lenders, (ii) if such Facility is the Canadian Term Facility,
the Required Canadian Term Lenders, (iii) if such Facility is the Euro
Term Facility, the Required Euro Term Lenders and (iv) if such Facility is
the Dollar Term Facility, the Required Dollar Term Lenders; provided,
however, that if such
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amendment adversely affects all of the Term Facilities in a proportionate
manner, only the written consent of the Required Term Lenders shall be
required;
(f) change any provision of this Section 10.01 or the definition of
"Required Lenders" or any other provision hereof specifying the number or
percentage of Lenders required to amend, waive or otherwise modify any
rights hereunder or make any determination or grant any consent hereunder,
without the written consent of each Lender;
(g) release all or substantially all of the Collateral in any
transaction or series of related transactions, without the written consent
of each Lender (it being understood that a transaction permitted under
Section 7.05 shall not constitute a release of all or substantially all of
the Collateral);
(h) other than in connection with a transaction permitted by Section
7.04 or Section 7.05, release all or substantially all of the combined
value of the ROV Guaranty, the KGaA Guaranty and the UK Guaranty, without
the written consent of each Lender; or
(i) impose any greater restriction on the ability of any Lender under
a Facility to assign any of its rights or obligations hereunder without
the written consent of (i) if such Facility is the Revolving Credit
Facility, the Required Revolving Lenders, (ii) if such Facility is the
Canadian Term Facility, the Required Canadian Term Lenders, (iii) if such
Facility is the Euro Term Facility, the Required Euro Term Lenders and
(iv) if such Facility is the Dollar Term Facility, the Required Dollar
Term Lenders; provided, however, that if such amendment adversely affects
all of the Term Facilities in a proportionate manner, only the written
consent of the Required Term Lenders shall be required;
and provided further that (i) no amendment, waiver or consent shall, unless in
writing and signed by the L/C Issuer in addition to the Lenders required above,
affect the rights or duties of the L/C Issuer under this Agreement or any
Issuer Document relating to any Letter of Credit issued or to be issued by it;
(ii) no amendment, waiver or consent shall, unless in writing and signed by the
Swing Line Lender in addition to the Lenders required above, affect the rights
or duties of the Swing Line Lender under this Agreement; (iii) no amendment,
waiver or consent shall, unless in writing and signed by the Administrative
Agent in addition to the Lenders required above, affect the rights or duties of
the Administrative Agent under this Agreement or any other Loan Document; (iv)
Section 10.06(h) may not be amended, waived or otherwise modified without the
consent of each Granting Lender all or any part of whose Loans are being funded
by an SPC at the time of such amendment, waiver or other modification; and (v)
the Fee Letter may be amended, or rights or privileges thereunder waived, in a
writing executed only by the parties thereto. Notwithstanding anything to the
contrary herein, (A) no Defaulting Lender shall have any right to approve or
disapprove any amendment, waiver or consent hereunder, except that the
Commitment of such Lender may not be increased or extended without the consent
of such Lender and (B) this Agreement and the other Loan Documents may be
amended by the Administrative Agent and the Loan Parties solely to reflect the
amortization, prepayment priority and other terms and conditions of any
Incremental Facility, any Chinese Facility contemplated by clause (iii) of the
definition thereof or any Additional Foreign Credit Facility (including, in
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the case of the Chinese Facility or Additional Foreign Credit Facility, the
reallocation of all or a portion of the U.S. Revolving Credit Commitment of a
U.S. Revolving Credit Lender to the Chinese Facility or Additional Foreign
Credit Facility, as the case may be, so long as such U.S. Revolving Credit
Lender consents to such reallocation.)
In the event that (1) the U.S. Borrower or the Administrative Agent
has requested the Lenders to consent to a departure or waiver of any provisions
of the Loan Documents or to agree to any amendment thereto, (2) the consent,
waiver or amendment in question requires the agreement of all affected Lenders
in accordance with the terms of this Section 10.01 or all the Lenders with
respect to a certain class of the Loans and (3) the Required Lenders have
agreed to such consent, waiver or amendment, then any Lender who does not agree
to such consent, waiver or amendment shall be deemed a "Non-Consenting Lender."
The Borrowers shall be entitled to (x) replace any Non-Consenting Lender in
accordance with the provisions of Section 10.14 or (y) terminate the
Commitments of such Non-Consenting Lender and pay to such Lender an amount
equal to the outstanding principal of its Loans and L/C Advances, accrued
interest thereon, accrued fees and all other amounts payable to it hereunder
and under the Loan Documents (including any amounts under Section 3.05).
10.02 Notices and Other Communications; Facsimile Copies.
(a) Notices Generally. Except in the case of notices and other
communications expressly permitted to be given by telephone (and except as
provided in subsection (b) below), all notices and other communications
provided for herein shall be in writing and shall be delivered by hand or
overnight courier service, mailed by certified or registered mail, electronic
mail or sent by telecopier as follows, and all notices and other communications
expressly permitted hereunder to be given by telephone shall be made to the
applicable telephone number, as follows:
(i) if to the Borrowers, the Administrative Agent, the L/C Issuer or
the Swing Line Lender, to the address, telecopier number, electronic mail
address or telephone number specified for such Person on Schedule 10.02;
and
(ii) if to any other Lender, to the address, telecopier number,
electronic mail address or telephone number specified in its
Administrative Questionnaire.
Notices sent by hand or overnight courier service shall be deemed to have been
given when received; notices mailed by certified or registered mail shall be
deemed to have been given four (4) Business Days after deposit in the mails
postage prepaid; notices sent by telecopier shall be deemed to have been given
when sent (except that, if not given during normal business hours for the
recipient, shall be deemed to have been given at the opening of business on the
next Business Day for the recipient). Notices delivered through electronic
communications to the extent provided in subsection (b) below shall be
effective as provided in such subsection (b).
(b) Electronic Communications. Notices and other communications to
the Lenders and the L/C Issuer hereunder may be delivered or furnished by
electronic communication (including e-mail and Internet or intranet websites)
pursuant to procedures approved by the Administrative Agent, provided that the
foregoing shall not apply to notices to
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any Lender or the L/C Issuer pursuant to Article II if such Lender or the L/C
Issuer, as applicable, has notified the Administrative Agent that it is
incapable of receiving notices under such Article by electronic communication.
The Administrative Agent or the Borrowers may, in their discretion, agree to
accept notices and other communications to each of them hereunder by electronic
communications pursuant to procedures approved by it, provided that approval of
such procedures may be limited to particular notices or communications.
Unless the Administrative Agent otherwise prescribes, (i) notices and
other communications sent to an e-mail address shall be deemed received upon
the sender's receipt of an acknowledgement from the intended recipient (such as
by the "return receipt requested" function, as available, return e-mail or
other written acknowledgement), provided that if such notice or other
communication is not sent during the normal business hours of the recipient,
such notice or communication shall be deemed to have been sent at the opening
of business on the next business day for the recipient, and (ii) notices or
communications posted to an Internet or intranet website shall be deemed
received upon the deemed receipt by the intended recipient at its e-mail
address as described in the foregoing clause (i) of notification that such
notice or communication is available and identifying the website address
therefor.
(c) The Platform. THE PLATFORM IS PROVIDED "AS IS" AND "AS
AVAILABLE." THE AGENT PARTIES (AS DEFINED BELOW) DO NOT WARRANT THE ACCURACY OR
COMPLETENESS OF THE BORROWER MATERIALS OR THE ADEQUACY OF THE PLATFORM, AND
EXPRESSLY DISCLAIM LIABILITY FOR ERRORS IN OR OMISSIONS FROM THE BORROWER
MATERIALS. NO WARRANTY OF ANY KIND, EXPRESS, IMPLIED OR STATUTORY, INCLUDING
ANY WARRANTY OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE,
NON-INFRINGEMENT OF THIRD PARTY RIGHTS OR FREEDOM FROM VIRUSES OR OTHER CODE
DEFECTS, IS MADE BY ANY AGENT PARTY IN CONNECTION WITH THE BORROWER MATERIALS
OR THE PLATFORM. In no event shall the Administrative Agent of any of its
Related Parties (collectively, the "Agent Parties") have any liability to
either Borrower, any Lender, the L/C Issuer or any other Person for losses,
claims, damages, liabilities or expenses of any kind (whether in tort, contract
or otherwise) arising out of either of the Borrowers' or the Administrative
Agent's transmission of Borrower Materials through the Internet, except to the
extent that such losses, claims, damages, liabilities or expenses are
determined by a court of competent jurisdiction by a final and nonappealable
judgment to have resulted from the gross negligence or willful misconduct of
such Agent Party; provided, however, that in no event shall any Agent Party
have any liability to either of the Borrowers, any Lender, the L/C Issuer or
any other Person for indirect, special, incidental, consequential or punitive
damages (as opposed to direct or actual damages).
(d) Change of Address, Etc. Each of the Borrowers, the Administrative
Agent, the L/C Issuer and the Swing Line Lender may change its address,
telecopier or telephone number for notices and other communications hereunder
by notice to the other parties hereto. Each other Lender may change its
address, telecopier or telephone number for notices and other communications
hereunder by notice to the Borrowers, the Administrative Agent, the L/C Issuer
and the Swing Line Lender. In addition, each Lender agrees to notify the
Administrative Agent from time to time to ensure that the Administrative Agent
has on record (i) an effective address,
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contact name, telephone number, telecopier number and electronic mail address
to which notices and other communications may be sent and (ii) accurate wire
instructions for such Lender.
(e) Reliance by Administrative Agent, L/C Issuer and Lenders. The
Administrative Agent, the L/C Issuer and the Lenders shall be entitled to rely
and act upon any notices (including telephonic Committed Loan Notices and Swing
Line Loan Notices ) purportedly given by or on behalf of each Borrower even if
(i) such notices were not made in a manner specified herein, were incomplete or
were not preceded or followed by any other form of notice specified herein, or
(ii) the terms thereof, as understood by the recipient, varied from any
confirmation thereof. Each Borrower shall indemnify the Administrative Agent,
the L/C Issuer, each Lender and the Related Parties of each of them from all
losses, costs, expenses and liabilities resulting from the reliance by such
Person on each notice purportedly given by or on behalf of either Borrower. All
telephonic notices to and other telephonic communications with the
Administrative Agent may be recorded by the Administrative Agent, and each of
the parties hereto hereby consents to such recording.
10.03 No Waiver; Cumulative Remedies. No failure by any Lender, the
L/C Issuer or the Administrative Agent to exercise, and no delay by any such
Person in exercising, any right, remedy, power or privilege hereunder or any
other Loan Document shall operate as a waiver thereof; nor shall any single or
partial exercise of any right, remedy, power or privilege hereunder preclude
any other or further exercise thereof or the exercise of any other right,
remedy, power or privilege. The rights, remedies, powers and privileges herein
provided, and provided under each other Loan Document, are cumulative and not
exclusive of any rights, remedies, powers and privileges provided by Law.
10.04 Expenses; Indemnity; Damage Waiver.
(a) Costs and Expenses. The Borrowers shall pay (i) all reasonable
out-of-pocket expenses incurred by the Administrative Agent and its Affiliates
(including the reasonable fees, charges and disbursements of counsel for the
Administrative Agent and of one local or special counsel in each jurisdiction
and for each specialty in which the Administrative Agent reasonably determines
it is necessary to retain such counsel), in connection with the syndication of
the credit facilities provided for herein, the preparation, negotiation,
execution, delivery and administration of this Agreement and the other Loan
Documents or any amendments, modifications or waivers of the provisions hereof
or thereof, (ii) all reasonable out-of-pocket expenses incurred by the L/C
Issuer in connection with the issuance, amendment, renewal or extension of any
Letter of Credit or any demand for payment thereunder and (iii) all
out-of-pocket expenses incurred by the Administrative Agent, any Lender or the
L/C Issuer (including the fees, charges and disbursements of any counsel for
the Administrative Agent, any Lender or the L/C Issuer), in connection with the
enforcement or protection of its rights (A) in connection with this Agreement
and the other Loan Documents, including its rights under this Section, or (B)
in connection with Loans made or Letters of Credit issued hereunder, including
all such out-of-pocket expenses incurred during any workout, restructuring or
negotiations in respect of such Loans or Letters of Credit.
(b) Indemnification by the Borrowers. Each Borrower shall indemnify
the Administrative Agent (and any sub-agent thereof), each Lender and the L/C
Issuer, and each
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Related Party of any of the foregoing Persons (each such Person being called an
"Indemnitee") against, and hold each Indemnitee harmless from, any and all
losses, claims, damages, liabilities and related expenses (including the
reasonable fees, charges and disbursements of any counsel for any Indemnitee
(which shall be limited to one (1) counsel to the Administrative Agent and the
Lenders, unless (x) the interests of the Administrative Agent and the Lenders
are sufficiently divergent, in which case one (1) additional counsel may be
appointed, and (y) if the interests of any Lender or group of Lenders (other
than all of the Lenders) are distinctly or disproportionately affected, one (1)
additional counsel for such Lender or group of Lenders)), incurred by any
Indemnitee or asserted against any Indemnitee by any third party or by either
Borrower or any other Loan Party arising out of, in connection with, or as a
result of (i) the execution or delivery of this Agreement, any other Loan
Document or any agreement or instrument contemplated hereby or thereby, the
performance by the parties hereto of their respective obligations hereunder or
thereunder or the consummation of the transactions contemplated hereby or
thereby or, in the case of the Administrative Agent (and any sub-agent thereof)
and its Related Parties only, the administration of this Agreement and the
other Loan Documents, (ii) any Loan or Letter of Credit, the use or proposed
use of the proceeds therefrom (including any refusal by the L/C Issuer to honor
a demand for payment under a Letter of Credit if the documents presented in
connection with such demand do not strictly comply with the terms of such
Letter of Credit), or any participation in a Letter of Credit (iii) any actual
or alleged presence or release of Hazardous Materials on or from any property
owned or operated by the U.S. Borrower or any of its Subsidiaries, or any
Environmental Liability related in any way to the U.S. Borrower or any of its
Subsidiaries, or (iv) any actual or prospective claim, litigation,
investigation or proceeding relating to any of the foregoing, whether based on
contract, tort or any other theory, whether brought by a third party or by
either Borrower or any other Loan Party or any of the Borrower's or such Loan
Party's directors, shareholders or creditors, and regardless of whether any
Indemnitee is a party thereto and whether or not any of the transactions
contemplated hereunder or under any of the other Loan Documents is consummated,
in all cases, whether or not caused by or arising, in whole or in part, out of
the comparative, contributory or sole negligence of the Indemnitee; provided
that such indemnity shall not, as to any Indemnitee, be available to the extent
that such losses, claims, damages, liabilities or related expenses (x) are
determined by a court of competent jurisdiction by final and nonappealable
judgment to have resulted from the gross negligence or willful misconduct of
such Indemnitee, (y) result from a claim brought by a Borrower or any other
Loan Party against an Indemnitee for breach in bad faith of such Indemnitee's
obligations hereunder or under any other Loan Document, if such Borrower or
such Loan Party has obtained a final and nonappealable judgment in its favor on
such claim as determined by a court of competent jurisdiction, or (z) arise
from claims of any of the Lenders solely against one or more other Lenders (and
not by one or more Lenders against Administrative Agent or one or more of the
other Agents) that have not resulted from the action, inaction, participation
or contribution of the Borrower or its Subsidiaries or other Affiliates or any
of their respective officers, directors, stockholders, partners, members,
employees, agents, representatives or advisors. No Indemnitee shall be liable
for any damages arising from the use by others of any information or other
materials obtained through IntraLinks or other similar information
transmissions systems in connection with this Agreement.
(c) Reimbursement by Lenders. To the extent that any Borrower for any
reason fails to indefeasibly pay any amount required under subsection (a) or
(b) of this Section to be paid by it to the Administrative Agent (or any
sub-agent thereof), the L/C Issuer or any
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Related Party of any of the foregoing, each Lender severally agrees to pay to
the Administrative Agent (or any such sub-agent), the L/C Issuer or such
Related Party, as the case may be, such Lender's Applicable Percentage
(determined as of the time that the applicable unreimbursed expense or
indemnity payment is sought) of such unpaid amount, provided that the
unreimbursed expense or indemnified loss, claim, damage, liability or related
expense, as the case may be, was incurred by or asserted against the
Administrative Agent (or any such sub-agent) or the L/C Issuer in its capacity
as such, or against any Related Party of any of the foregoing acting for the
Administrative Agent (or any such sub-agent) or L/C Issuer in connection with
such capacity. The obligations of the Lenders under this subsection (c) are
subject to the provisions of Section 2.14(d).
(d) Waiver of Consequential Damages, Etc. To the fullest extent
permitted by applicable Law, each Borrower shall not assert, and hereby waives,
any claim against any Indemnitee, on any theory of liability, for special,
indirect, consequential or punitive damages (as opposed to direct or actual
damages) arising out of, in connection with, or as a result of, this Agreement,
any other Loan Document or any agreement or instrument contemplated hereby, the
transactions contemplated hereby or thereby, any Loan or Letter of Credit or
the use of the proceeds thereof. No Indemnitee referred to in subsection (b)
above shall be liable for any damages arising from the use by unintended
recipients of any information or other materials distributed by it through
telecommunications, electronic or other information transmission systems in
connection with this Agreement or the other Loan Documents or the transactions
contemplated hereby or thereby.
(e) Payments. All amounts due under this Section shall be payable not
later than ten Business Days after demand therefor.
(f) Survival. The agreements in this Section shall survive the
resignation of the Administrative Agent, the replacement of any Lender, the
termination of the Aggregate Commitments and the repayment, satisfaction or
discharge of all the other Obligations.
10.05 Payments Set Aside. To the extent that any payment by or on
behalf of a Borrower is made to the Administrative Agent, the L/C Issuer or any
Lender, or the Administrative Agent, the L/C Issuer or any Lender exercises its
right of setoff, and such payment or the proceeds of such setoff or any part
thereof is subsequently invalidated, declared to be fraudulent or preferential,
set aside or required (including pursuant to any settlement entered into by the
Administrative Agent, the L/C Issuer or such Lender in its discretion) to be
repaid to a trustee, receiver or any other party, in connection with any
proceeding under any Debtor Relief Law or otherwise, then (a) to the extent of
such recovery, the obligation or part thereof originally intended to be
satisfied shall be revived and continued in full force and effect as if such
payment had not been made or such setoff had not occurred, and (b) each Lender
and the L/C Issuer severally agrees to pay to the Administrative Agent upon
demand its applicable share (without duplication) of any amount so recovered
from or repaid by the Administrative Agent, plus interest thereon from the date
of such demand to the date such payment is made at a rate per annum equal to
the Federal Funds Rate from time to time in effect. The obligations of the
Lenders and the L/C Issuer under clause (b) of the preceding sentence shall
survive the payment in full of the Obligations and the termination of this
Agreement.
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10.06 Successors and Assigns.
(a) Successors and Assigns Generally. The provisions of this
Agreement shall be binding upon and inure to the benefit of the parties hereto
and their respective successors and assigns permitted hereby, except that none
of the Borrowers or any other Loan Party may assign or otherwise transfer any
of its rights or obligations hereunder without the prior written consent of the
Administrative Agent and each Lender and no Lender may assign or otherwise
transfer any of its rights or obligations hereunder except (i) to an Eligible
Assignee in accordance with the provisions of Section 10.06(b), (ii) by way of
participation in accordance with the provisions of Section 10.06(d), or (iii)
by way of pledge or assignment of a security interest subject to the
restrictions of Section 10.06(f), or (iv) to an SPC in accordance with the
provisions of Section 10.06(h) (and any other attempted assignment or transfer
by any party hereto shall be null and void). Nothing in this Agreement,
expressed or implied, shall be construed to confer upon any Person (other than
the parties hereto, their respective successors and assigns permitted hereby,
Participants to the extent provided in subsection (d) of this Section and, to
the extent expressly contemplated hereby, the Related Parties of each of the
Administrative Agent, the L/C Issuer and the Lenders) any legal or equitable
right, remedy or claim under or by reason of this Agreement.
(b) Assignments by Lenders. Any Lender may at any time assign to one
or more Eligible Assignees all or a portion of its rights and obligations under
this Agreement (including all or a portion of its Commitment and the Loans
(including for purposes of this Section 10.06(b), participations in L/C
Obligations and in Swing Line Loans) at the time owing to it); provided that
(i) except in the case of an assignment of the entire remaining
amount of the assigning Lender's Commitment and the Loans at the time
owing to it or in the case of an assignment to a Lender or an Affiliate of
a Lender or an Approved Fund with respect to a Lender, the aggregate
amount of the Commitment (which for this purpose includes Loans
outstanding thereunder) or, if the applicable Commitment is not then in
effect, the principal outstanding balance of the Loan of the assigning
Lender subject to each such assignment, determined as of the date the
Assignment and Assumption with respect to such assignment is delivered to
the Administrative Agent or, if "Trade Date" is specified in the
Assignment and Assumption, as of the Trade Date, shall not be less than
U.S. $5,000,000, in the case of any assignment in respect of the U.S.
Revolving Credit Facility, (euro)5,000,000 in the case of any assignment
in respect of the Euro Revolving Credit Facility, (pound)5,000,000 in the
case of any assignment in respect of the UK Revolving Credit Facility,
U.S. $1,000,000, in the case of any assignment in respect of the Dollar
Term Facility, (euro)1,000,000 in the case of any assignment in respect of
the Euro Term Facility or CAD1,000,000 in the case of any assignment in
respect of the Canadian Term Facility unless each of the Administrative
Agent and, so long as no Event of Default under Section 8.01 (a), (f), or
(g) has occurred and is continuing, the applicable Borrower otherwise
consents (each such consent not to be unreasonably withheld or delayed);
provided, however, that concurrent assignments to members of an Assignee
Group and concurrent assignments from members of an Assignee Group to a
single Eligible Assignee (or to an Eligible Assignee and members of its
Assignee Group) will be treated as a single assignments for purposes of
determine whether such minimum amount has been met;
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(ii) each partial assignment shall be made as an assignment of a
proportionate part of all the assigning Lender's rights and obligations
under this Agreement with respect to the Loans or the Commitment assigned,
except that this clause (ii) shall not (A) apply to rights in respect of
Swing Line Loans or (B) prohibit any Lender from assigning all or a
portion of its rights and obligations among separate Facilities on a
non-pro rata basis;
(iii) any assignment of a Revolving Credit Commitment must be approved
by the Administrative Agent, the L/C Issuer and the Swing Line Lender
unless the Person that is the proposed assignee is itself a Revolving
Credit Lender under the applicable Facility (whether or not the proposed
assignee would otherwise qualify as an Eligible Assignee);
(iv) the parties to each assignment shall execute and deliver to the
Administrative Agent an Assignment and Assumption, together with a
processing and recordation fee in the amount, if any, required as set
forth in Schedule 10.06; and
(v) and the Eligible Assignee, if it shall not be a Lender, shall
deliver to the Administrative Agent an Administrative Questionnaire.
Subject to acceptance and recording thereof by the Administrative Agent
pursuant to subsection (c) of this Section, from and after the effective date
specified in each Assignment and Assumption, the Eligible Assignee thereunder
shall be a party to this Agreement and, to the extent of the interest assigned
by such Assignment and Assumption, have the rights and obligations of a Lender
under this Agreement, and the assigning Lender thereunder shall, to the extent
of the interest assigned by such Assignment and Assumption, be released from
its obligations under this Agreement (and, in the case of an Assignment and
Assumption covering all of the assigning Lender's rights and obligations under
this Agreement, such Lender shall cease to be a party hereto but shall continue
to be entitled to the benefits of Sections 3.01, 3.04, 3.05, 10.03, 10.04 and
10.15with respect to facts and circumstances occurring prior to the effective
date of such assignment). Upon request, the applicable Borrower (at its
expense) shall execute and deliver a Note to the assignee Lender. Any
assignment or transfer by a Lender of rights or obligations under this
Agreement that does not comply with this subsection shall be treated for
purposes of this Agreement as a sale by such Lender of a participation in such
rights and obligations in accordance with Section 10.06(d). The Borrowers shall
not, as a result of any assignment by any Lender to any of such Lender's
Affiliates, incur increased liability for any Taxes.
(c) Register. The Administrative Agent, acting solely for this
purpose as an agent of the Borrowers, shall maintain at the Administrative
Agent's Office a copy of each Assignment and Assumption delivered to it and a
register for the recordation of the names and addresses of the Lenders, and the
Commitments of, and principal amounts (and related amounts) of the Loans, L/C
Obligations (specifying the aggregate Unreimbursed Amounts), L/C Borrowings and
the amounts due under Section 2.03, 2.04 and 2.05 owing to, each Lender
pursuant to the terms hereof from time to time (the "Register"). The entries in
the Register shall be conclusive, and the Borrowers, the Administrative Agent
and the Lenders shall treat each Person whose name is recorded in the Register
pursuant to the terms hereof as a Lender
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hereunder for all purposes of this Agreement, notwithstanding notice to the
contrary. No transfer or assignment of any rights or obligations with respect
to the Loans or L/C Obligations (including pursuant to Sections 10.06(b), (d),
and (h)) shall be effective unless such transfer or assignment is recorded in
the Register. This Section 10.06(c) shall be construed so that the Loans and
L/C Obligations are at all times maintained in "registered form" within the
meaning of Sections 163(f), 871(h)(2), and 881(c)(2) of the Code and the
Treasury regulations promulgated thereunder (and any other relevant or
successor provisions of the Code and Treasury regulations promulgated
thereunder). The Register shall be available for inspection by each of the
Borrowers, the Lenders and the L/C Issuer at any reasonable time and from time
to time upon reasonable prior notice. In addition, at any time that a request
for a consent for a material or other substantive change to the Loan Documents
is pending, any Lender may request and receive from the Administrative Agent a
copy of the Register. Upon receipt of a duly completed and executed Assignment
and Assumption and compliance by the assigning Lender and Eligible Assignee
with the other applicable provisions of this Section 10.06, the Administrative
Agent shall accept such Assignment and Assumption and record the information
contained therein in the Register.
(d) Participations. Any Lender may at any time, without the consent
of, or notice to, the applicable Borrower or the Administrative Agent, sell
participations to any Person (other than a natural person or the U.S. Borrower
or any of the Borrower's Affiliates or Subsidiaries) (each, a "Participant") in
all or a portion of such Lender's rights and/or obligations under this
Agreement (including all or a portion of its Commitment and/or the Loans
(including such Lender's participations in L/C Obligations and/or Swing Line
Loans) owing to it); provided that (i) such Lender's obligations under this
Agreement shall remain unchanged, (ii) such Lender shall remain solely
responsible to the other parties hereto for the performance of such obligations
and (iii) the Borrowers, the Administrative Agent and the other Lenders shall
continue to deal solely and directly with such Lender in connection with such
Lender's rights and obligations under this Agreement or any other Loan
Document. Any agreement or instrument pursuant to which a Lender sells such a
participation shall provide that such Lender shall retain the sole right to
enforce this Agreement and to approve any amendment, modification or waiver of
any provision of this Agreement; provided that such agreement or instrument may
provide that such Lender will not, without the consent of the Participant,
agree to any amendment, waiver or other modification described in clauses (b),
(c), (d), (g) or (h) of Section 10.01 that directly affects such Participant.
Subject to subsection (e) of this Section, each Borrower agrees that each
Participant shall be entitled to the benefits of Sections 3.01, 3.04, 3.05 and
10.15 to the same extent as if it were a Lender and had acquired its interest
by assignment pursuant to Section 10.06(b).
(e) Limitations upon Participant Rights. A Participant shall not be
entitled to receive any greater payment under Section 3.01 or 3.04 than the
applicable Lender would have been entitled to receive with respect to the
participation sold to such Participant. A Participant shall not be entitled to
the benefits of Section 3.01 unless the applicable Borrower is notified of the
participation sold to such Participant and such Participant agrees, for the
benefit of such Borrower, to comply with Section 3.01(f) as though it were a
Lender.
(f) Certain Pledges. Any Lender may at any time pledge or assign a
security interest in all or any portion of its rights under this Agreement
(including under its Note, if any)
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to secure obligations of such Lender, including any pledge or assignment to
secure obligations to a Federal Reserve Bank; provided that no such pledge or
assignment shall release such Lender from any of its obligations hereunder or
substitute any such pledgee or assignee for such Lender as a party hereto.
(g) Electronic Execution of Assignments. The words "execution,"
"signed," "signature," and words of like import in any Assignment and
Assumption shall be deemed to include electronic signatures or the keeping of
records in electronic form, each of which shall be of the same legal effect,
validity or enforceability as a manually executed signature or the use of a
paper-based recordkeeping system, as the case may be, to the extent and as
provided for in any applicable Law, including the Federal Electronic Signatures
in Global and National Commerce Act, the New York State Electronic Signatures
and Records Act, or any other similar state laws based on the Uniform
Electronic Transactions Act.
(h) Special Purpose Funding Vehicles. Notwithstanding anything to the
contrary contained herein, any Lender (a "Granting Lender") may grant to a
special purpose funding vehicle identified as such in writing from time to time
by the Granting Lender to the Administrative Agent and the Borrowers (an "SPC")
the option to provide all or any part of any Loan that such Granting Lender
would otherwise be obligated to make pursuant to this Agreement; provided that
(i) nothing herein shall constitute a commitment by any SPC to fund any Loan,
and (ii) if an SPC elects not to exercise such option or otherwise fails to
make all or any part of such Loan, the Granting Lender shall be obligated to
make such Loan pursuant to the terms hereof or, if it fails to do so, to make
such payment to the Administrative Agent as is required under Section 2.14.
Each party hereto hereby agrees that (A) neither the grant to any SPC nor the
exercise by any SPC of such option shall increase the costs or expenses or
otherwise increase or change the obligations of the Borrowers under this
Agreement (including its obligations under Section 3.01 and Section 3.04), (B)
no SPC shall be liable for any indemnity or similar payment obligation under
this Agreement for which a Lender would be liable, and (C) the Granting Lender
shall for all purposes, including the approval of any amendment, waiver or
other modification of any provision of any Loan Document, remain the lender of
record hereunder. The making of a Loan by an SPC hereunder shall utilize the
Commitment of the Granting Lender to the same extent, and as if, such Loan were
made by such Granting Lender. In furtherance of the foregoing, each party
hereto hereby agrees (which agreement shall survive the termination of this
Agreement) that, prior to the date that is one year and one day after the
payment in full of all outstanding commercial paper or other senior debt of any
SPC, it will not institute against, or join any other Person in instituting
against, such SPC any bankruptcy, reorganization, arrangement, insolvency, or
liquidation proceeding under the Laws of the United States or any State
thereof. Notwithstanding anything to the contrary contained herein, any SPC may
(1) with notice to, but without prior consent of the U.S. Borrower and the
Administrative Agent and with the payment of a processing fee in the amount of
$2,500, assign all or any portion of its right to receive payment with respect
to any Loan to the Granting Lender and (2) disclose on a confidential basis any
non-public information relating to its funding of Loans to any rating agency,
commercial paper dealer or provider of any surety or Guarantee or credit or
liquidity enhancement to such SPC.
(i) Resignation as L/C Issuer or Swing Line Lender after Assignment.
Notwithstanding anything to the contrary contained herein, if at any time Bank
of America
175
assigns all of its Revolving Credit Commitments and Revolving Credit Loans
pursuant to Section 10.06(b), Bank of America may, (i) upon 30 days' notice to
the U.S. Borrower and the Lenders, resign as L/C Issuer and/or (ii) upon 30
days' notice to the U.S. Borrower, resign as Swing Line Lender. In the event of
any such resignation as L/C Issuer or Swing Line Lender, the Borrowers shall be
entitled to appoint from among the Lenders a successor L/C Issuer or Swing Line
Lender hereunder; provided, however, that no failure by the Borrowers to
appoint any such successor shall affect the resignation of Bank of America as
L/C Issuer or Swing Line Lender, as the case may be. If Bank of America resigns
as L/C Issuer, it shall retain all the rights, powers, privileges and duties of
the L/C Issuer hereunder with respect to all Letters of Credit outstanding as
of the effective date of its resignation as L/C Issuer and all L/C Obligations
with respect thereto (including the right to require the Lenders to make Base
Rate Loans, Eurocurrency Rate Loans or fund risk participations in Unreimbursed
Amounts pursuant to Section 2.03(c), 2.04(c) and 2.05(c)). If Bank of America
resigns as Swing Line Lender, it shall retain all the rights of the Swing Line
Lender provided for hereunder with respect to Swing Line Loans made by it and
outstanding as of the effective date of such resignation, including the right
to require the Lenders to make Loans or fund risk participations in outstanding
Swing Line Loans pursuant to Section 2.06(e). Upon the appointment of a
successor L/C Issuer and/or Swing Line Lender, (a) such successor shall succeed
to and become vested with all of the rights, powers, privileges and duties of
the retiring L/C Issuer or Swing Line Lender, as the case may be, and (b) the
successor L/C Issuer shall issue letters of credit in substitution for the
Letters of Credit, if any, outstanding at the time of such succession or make
other arrangements satisfactory to Bank of America to effectively assume the
obligations of Bank of America with respect to such Letters of Credit.
10.07 Treatment of Certain Information; Confidentiality. Each of the
Administrative Agent, the Lenders and the L/C Issuer agrees to maintain the
confidentiality of the Information (as defined below), except that Information
may be disclosed (a) to its Affiliates and to its and its Affiliates'
respective partners, directors, officers, employees, agents, advisors and
representatives (it being understood that the Persons to whom such disclosure
is made will be informed of the confidential nature of such Information and
instructed to keep such Information confidential), (b) to the extent requested
by any regulatory authority purporting to have jurisdiction over it (including
any self-regulatory authority, such as the National Association of Insurance
Commissioners), (c) to the extent required by applicable Laws or by any
subpoena or similar legal process, (d) to any other party hereto, (e) in
connection with the exercise of any remedies hereunder or under any Loan
Document or any action or proceeding relating to this Agreement or any other
Loan Document or the enforcement of rights hereunder or thereunder, (f) subject
to an agreement containing provisions substantially the same as those of this
Section 10.07, to (i) any assignee of or Participant in, or any prospective
assignee of or Participant in, any of its rights or obligations under this
Agreement or (ii) any actual or prospective counterparty (or its professional
advisors) to any swap or derivative transaction relating to the U.S. Borrower
and its obligations, (g) with the consent of the U.S. Borrower or (h) to the
extent such Information (i) becomes publicly available other than as a result
of a breach of this Section 10.07 or (ii) becomes available to the
Administrative Agent, any Lender, the L/C Issuer or any of their respective
Affiliates on a nonconfidential basis from a source other than the Borrowers.
For the purposes of this Section, "Information" means all information received
from any Loan Party relating to any Loan Party or its business, other than any
such information that is available to the Administrative Agent, the L/C Issuer
or any Lender on a
176
nonconfidential basis prior to disclosure by any Loan Party; provided that, in
the case of information received from a Loan Party after the date hereof, such
information is clearly identified in writing at the time of delivery as
confidential. Any Person required to maintain the confidentiality of
Information as provided in this Section 10.07 shall be considered to have
complied with its obligation to do so if such Person has exercised the same
degree of care to maintain the confidentiality of such Information as such
Person would accord to its own confidential information.
Each of the Administrative Agent, the Lenders and the L/C Issuer
acknowledges that (a) the Information may include material non-public
information concerning the Borrowers or a Subsidiary, as the case may be, (b)
it has developed compliance procedures regarding the use of material non-public
information and (c) it will handle such material non-public information in
accordance with applicable Law, including Federal and state securities Laws.
10.08 Right of Setoff.
If an Event of Default shall have occurred and be continuing, each
Lender and the L/C Issuer is hereby authorized at any time and from time to
time, to the fullest extent permitted by applicable Law, to set off and apply
any and all deposits (general or special, time or demand, provisional or final,
in whatever currency) at any time held and other obligations (in whatever
currency) at any time owing by such Lender or the L/C Issuer to or for the
credit or the account of either Borrower or any other Loan Party against any
and all of the Obligations of the Borrowers or such Loan Party now or hereafter
existing under this Agreement or any other Loan Document to such Lender or the
L/C Issuer, irrespective of whether or not such Lender or the L/C Issuer shall
have made any demand under this Agreement or any other Loan Document and
although such obligations of such Borrower or such Loan Party may be contingent
or unmatured or are owed to a branch or office of such Lender or the L/C Issuer
different from the branch or office holding such deposit or obligated on such
indebtedness. The rights of each Lender and the L/C Issuer under this Section
are in addition to other rights and remedies (including other rights of setoff)
that such Lender and the L/C Issuer may have. Each Lender and the L/C Issuer
agrees to notify the U.S. Borrower and the Administrative Agent promptly after
any such setoff and application, provided that the failure to give such notice
shall not affect the validity of such setoff and application.
10.09 Non-U.S. Subsidiaries. Notwithstanding any provision of any Loan
Document to the contrary (including any provision that would otherwise apply
notwithstanding other provisions or that is the beneficiary of other overriding
language), (i) no more than 65% of the voting interests in or of any Subsidiary
incorporated under the Laws of a jurisdiction other than the United States (a
"non-U.S. Subsidiary") shall be pledged or similarly hypothecated to Guarantee
or support any Obligation of the U.S. Borrower, (ii) no non-U.S. Subsidiary
shall Guarantee or support any Obligation of the U.S. Borrower, (iii) no
security or similar interest shall be granted in the assets of any non-U.S.
Subsidiary which security or similar interest Guarantees or supports any
Obligation of the U.S. Borrower and (iv) nothing in this Agreement shall be
construed as a Guarantee, security or support by the Euro Borrower of or for
obligations of the U.S. Borrower or any of its Subsidiaries. The parties agree
that any pledge, Guarantee or security or similar interest made or granted in
contravention of this Section 10.09 shall be void ab initio.
177
10.10 Interest Rate Limitation. Notwithstanding anything to the
contrary contained in any Loan Document, the interest paid or agreed to be paid
under the Loan Documents shall not exceed the maximum rate of non-usurious
interest permitted by applicable Law (the "Maximum Rate"). If the
Administrative Agent or any Lender shall receive interest in an amount that
exceeds the Maximum Rate, the excess interest shall be applied to the principal
of the Loans or, if it exceeds such unpaid principal, refunded to the
applicable Borrower. In determining whether the interest contracted for,
charged, or received by the Administrative Agent or a Lender exceeds the
Maximum Rate, such Person may, to the extent permitted by applicable Law,
amortize, prorate, allocate, and spread in equal or unequal parts the total
amount of interest throughout the contemplated term of the Obligations
hereunder.
10.11 Counterparts; Effectiveness. This Agreement may be executed in
counterparts (and by different parties hereto in different counterparts), each
of which shall constitute an original, but all of which when taken together
shall constitute a single contract. Except as provided in Section 4.01, this
Agreement shall become effective when it shall have been executed by the
Administrative Agent and when the Administrative Agent shall have received
counterparts hereof that, when taken together, bear the signatures of each of
the other parties hereto. Delivery of an executed counterpart of a signature
page of this Agreement by telecopy or by an electronically mailed scanned copy
shall be effective as delivery of a manually executed counterpart of this
Agreement.
10.12 Survival of Representations and Warranties. All representations
and warranties made hereunder and in any other Loan Document or other document
delivered pursuant hereto or thereto or in connection herewith or therewith
shall survive the execution and delivery hereof and thereof. Such
representations and warranties have been or will be relied upon by the
Administrative Agent and each Lender, regardless of any investigation made by
the Administrative Agent or any Lender or on their behalf and notwithstanding
that the Administrative Agent or any Lender may have had notice or knowledge of
any Default at the time of any Credit Extension, and shall continue in full
force and effect as long as any Loan or any other Obligation hereunder shall
remain unpaid or unsatisfied or any Letter of Credit shall remain outstanding.
10.13 Severability. If any provision of this Agreement or the other
Loan Documents is held to be illegal, invalid or unenforceable, (a) the
legality, validity and enforceability of the remaining provisions of this
Agreement and the other Loan Documents shall not be affected or impaired
thereby and (b) the parties shall endeavor in good faith negotiations to
replace the illegal, invalid or unenforceable provisions with valid provisions
the economic effect of which comes as close as possible to that of the illegal,
invalid or unenforceable provisions. The invalidity of a provision in a
particular jurisdiction shall not invalidate or render unenforceable such
provision in any other jurisdiction.
10.14 Replacement of Lenders. If any Lender requests compensation
under Section 3.04, or if a Borrower is required to pay or delivers to such
Lender and the Administrative Agent a certificate setting forth reasons as to
why it reasonably anticipates that it will be required to pay, and such Lender
and the Administrative Agent agree with such reasons, any additional amount to
any Lender or any Governmental Authority for the account of any Lender pursuant
to Section 3.01, if any Lender ceases to make Eurocurrency Rate Loans as a
178
result of a condition described in Section 3.02 or Section 3.04, if any Lender
is a Defaulting Lender or a Non-Consenting Lender or if any other circumstance
exists hereunder that gives a Borrower the right to replace a Lender as a party
hereto, then such Borrower may, at its sole expense and effort, upon notice to
such Lender and the Administrative Agent, require such Lender to assign and
delegate, without recourse (in accordance with and subject to the restrictions
contained in, and consents required by, Section 10.06), all of its interests,
rights and obligations under this Agreement and the related Loan Documents to
an assignee that shall assume such obligations (which assignee may be another
Lender, if a Lender accepts such assignment), provided that:
(a) such Borrower shall have paid to the Administrative Agent the
assignment fee specified in Section 10.06(b);
(b) such Lender shall have received payment of an amount equal to the
outstanding principal of its Loans and L/C Advances, accrued interest thereon,
accrued fees and all other amounts payable to it hereunder and under the other
Loan Documents (including any amounts under Section 3.05) from the assignee (to
the extent of such outstanding principal and accrued interest and fees) or a
Borrower (in the case of all other amounts);
(c) in the case of any such assignment resulting from a claim for
compensation under Section 3.04 or payments required to be made pursuant to
Section 3.01, such assignment will result in a reduction in such compensation
or payments thereafter; and
(d) such assignment does not conflict with applicable Law.
A Lender shall not be required to make any such assignment or
delegation if, prior thereto, as a result of a waiver by such Lender or
otherwise, the circumstances entitling the applicable Borrower to require such
assignment and delegation cease to apply.
10.15 Judgment. (a) Rate of Exchange. If, for the purpose of
obtaining judgment in any court, it is necessary to convert a sum due
hereunder, under the ROV Guaranty, the KGaA Guaranty or the UK Guaranty, or
under any Note or Notes in another currency into US Dollars or into a Foreign
Currency, as the case may be, the parties hereto agree, to the fullest extent
that they may effectively do so, that the rate of exchange used shall be that
at which, in accordance with normal banking procedures, a Lender could purchase
such other currency with US Dollars or with a Foreign Currency, as the case may
be, in New York City, New York at the close of business on the Business Day
immediately preceding the day on which final judgment is given, together with
any premiums and costs of exchange payable in connection with such purchase.
(b) Indemnity. The obligation of each Borrower in respect of any
sum due from it to the Administrative Agent or any Lender hereunder or under
any Note or Notes shall, notwithstanding any judgment in a currency other than
US Dollars or a Foreign Currency, as the case may be, be discharged only to the
extent that on the Business Day next succeeding receipt by the Administrative
Agent or such Lender of any sum adjudged to be so due in such other currency,
the Administrative Agent or such Lender may, in accordance with normal banking
procedures, purchase US Dollars or such Foreign Currency, as the case may be,
with such other
179
currency. If the US Dollars or such Foreign Currency so purchased are less than
the sum originally due to the Administrative Agent or such Lender in US Dollars
or in such Foreign Currency, each Borrower agrees, as a separate obligation and
notwithstanding any such judgment, to indemnify the Administrative Agent or
such Lender against such loss, and if the US Dollars or such Foreign Currency
so purchased exceed the sum originally due to the Administrative Agent or any
Lender in US Dollars or in such Foreign Currency, as the case may be, the
Administrative Agent or such Lender agrees to remit to such Borrower such
excess.
10.16 Governing Law; Jurisdiction; Etc.
(a) GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED
IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK, PROVIDED THAT SECTIONS
9.01 (C), 9.02 AND 9.13 SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH,
THE LAWS OF THE FEDERAL REPUBLIC OF GERMANY.
(b) SUBMISSION TO JURISDICTION. EACH BORROWER AND EACH OTHER LOAN
PARTY IRREVOCABLY AND UNCONDITIONALLY SUBMITS, FOR ITSELF AND ITS PROPERTY, TO
THE NONEXCLUSIVE JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK SITTING IN
NEW YORK COUNTY AND OF THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN
DISTRICT OF NEW YORK, AND ANY APPELLATE COURT FROM ANY THEREOF, IN ANY ACTION
OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN
DOCUMENT, OR FOR RECOGNITION OR ENFORCEMENT OF ANY JUDGMENT, AND EACH OF THE
PARTIES HERETO IRREVOCABLY AND UNCONDITIONALLY AGREES THAT ALL CLAIMS IN
RESPECT OF ANY SUCH ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED IN SUCH
NEW YORK STATE COURT OR, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, IN
SUCH FEDERAL COURT. EACH OF THE PARTIES HERETO AGREES THAT A FINAL JUDGMENT IN
ANY SUCH ACTION OR PROCEEDING SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN OTHER
JURISDICTIONS BY SUIT ON THE JUDGMENT OR IN ANY OTHER MANNER PROVIDED BY LAW.
NOTHING IN THIS AGREEMENT OR IN ANY OTHER LOAN DOCUMENT SHALL AFFECT ANY RIGHT
THAT THE ADMINISTRATIVE AGENT, ANY LENDER OR THE L/C ISSUER MAY OTHERWISE HAVE
TO BRING ANY ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER LOAN
DOCUMENT AGAINST A BORROWER OR ANY OTHER LOAN PARTY OR ITS PROPERTIES IN THE
COURTS OF ANY JURISDICTION.
(c) WAIVER OF VENUE. EACH BORROWER AND EACH OTHER LOAN PARTY
IRREVOCABLY AND UNCONDITIONALLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY
APPLICABLE LAW, ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE LAYING
OF VENUE OF ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS
AGREEMENT OR ANY OTHER LOAN DOCUMENT IN ANY COURT REFERRED TO IN PARAGRAPH (B)
OF THIS SECTION. EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW, THE DEFENSE OF AN
180
INCONVENIENT FORUM TO THE MAINTENANCE OF SUCH ACTION OR PROCEEDING IN ANY SUCH
COURT.
(d) SERVICE OF PROCESS. EACH PARTY HERETO IRREVOCABLY CONSENTS TO
SERVICE OF PROCESS IN THE MANNER PROVIDED FOR NOTICES IN SECTION 10.02 (OTHER
THAN BY EMAIL OR OTHER ELECTRONIC COMMUNICATION). NOTHING IN THIS AGREEMENT
WILL AFFECT THE RIGHT OF ANY PARTY HERETO TO SERVE PROCESS IN ANY OTHER MANNER
PERMITTED BY APPLICABLE LAW.
10.17 Waiver of Jury Trial. EACH PARTY HERETO HEREBY IRREVOCABLY
WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY
HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING
OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT OR THE
TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY (WHETHER BASED ON CONTRACT, TORT OR
ANY OTHER THEORY). EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE,
AGENT OR ATTORNEY OF ANY OTHER PERSON HAS REPRESENTED, EXPRESSLY OR OTHERWISE,
THAT SUCH OTHER PERSON WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE
THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO
HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS BY,
AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.
10.18 USA PATRIOT Act Notice. Each Lender that is subject to the Act
(as hereinafter defined) and the Administrative Agent (for itself and not on
behalf of any Lender) hereby notifies the Borrowers that pursuant to the
requirements of the USA PATRIOT Act (Title III of Pub. L. 107-56 (signed into
law October 26, 2001)) (the "Act"), it is required to obtain, verify and record
information that identifies each Loan Party, which information includes the
name and address of each Loan Party and other information that will allow such
Lender or the Administrative Agent, as applicable, to identify each Loan Party
in accordance with the Act.
10.19 "Know your customer" checks
(a) If:
(i) the introduction of or any change in (or in the
interpretation, administration or application of) any law or
regulation made after the date of this Agreement;
(ii) any change in the status of any Borrower after the date of
this Agreement; or
(iii) a proposed assignment or transfer by a Lender of any of
its rights and obligations under this Agreement to a party that is not
a Lender prior to such assignment or transfer,
181
obliges the Administrative Agent or any Lender (or, in the case of paragraph
(iii) above, any prospective new Lender) to comply with "know your customer" or
similar identification procedures in circumstances where the necessary
information is not already available to it, each Borrower shall promptly upon
the request of the Administrative Agent or any Lender supply, or procure the
supply of, such documentation and other evidence as is reasonably requested by
the Administrative Agent (for itself or on behalf of any Lender) or any Lender
(for itself or, in the case of the event described in paragraph (iii) above, on
behalf of any prospective new Lender) in order for the Administrative Agent,
such Lender or, in the case of the event described in paragraph (iii) above,
any prospective new Lender to carry out and be reasonably satisfied it has
complied with all necessary "know your customer" or other similar checks under
all applicable laws and regulations pursuant to the transactions contemplated
in this Agreement.
(b) Each Lender shall promptly upon the request of the Administrative
Agent supply, or procure the supply of, such documentation and other evidence
as is reasonably requested by the Administrative Agent (for itself) in order
for the Administrative Agent to carry out and be reasonably satisfied it has
complied with all necessary "know your customer" or other similar checks under
all applicable laws and regulations pursuant to the transactions contemplated
in this Agreement.
182
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed as of the date first above written.
RAYOVAC CORPORATION, as the U.S.
Borrower
By: /s/ James T. Lucke
-------------------------------------------
Name: James T. Lucke
Title: Senior Vice President, Secretary and
General Counsel
183
VARTA CONSUMER BATTERIES GmbH & Co.
KGaA, as the Subsidiary Borrower
By: /s/ Andreas Rouve
-------------------------------------------
Name: Andreas Rouve
Title: Chief Financial Officer
By: /s/ Remy Burel
-------------------------------------------
Name: Remy Burel
Title: Chief Executive Officer
184
RAYOVAC EUROPE LIMITED, as the UK
Borrower
By: /s/ Remy Burel
-------------------------------------------
Name: Remy Burel
Title: Chief Executive Officer
185
LENDER:
BANC ONE HIGH YIELD
By: /s/ James E. Gibson
-------------------------------------------
Name: James E. Gibson
Title: Vice President
186
LENDER:
BANK OF TOKYO - MITSUBISHI TRUST COMPANY
By: /s/ Anna Bezdenezhnykh Guiller
-------------------------------------------
Name: Anna Bezdenezhnykh Guiller
Title: Vice President
187
LENDER:
CALYON NEW YORK BRANCH
By: /s/ Philippe Soustra
-------------------------------------------
Name: Philippe Soustra
Title: Senior Vice President
By: /s/ Attila Coach
-------------------------------------------
Name: Attila Coach
Title: Managing Director
188
LENDER:
CAROLINA FIRST BANK
By: /s/ Charles Chamberlain
-------------------------------------------
Name: Charles Chamberlain
Title: Executive Vice President
189
LENDER:
CITICORP NORTH AMERICA, INC.
By: /s/ Julie Persily
-------------------------------------------
Name: Julie Persily
Title: Managing Director
190
LENDER:
CIT LENDING SERVICES CORPORATION
By: /s/ John P. Sirico, II
-------------------------------------------
Name: John P. Sirico, II
Title: Vice President
191
LENDER:
COMMERZBANK AG, NEW YORK AND
GRAND CAYMAN BRANCHES
By: /s/ Adam T. Strom
-------------------------------------------
Name: Adam T. Strom
Title: Vice President
By: /s/ Henry J. Spark
-------------------------------------------
Name: Henry J. Spark
Title: Assistant Vice President
192
LENDER:
CREDIT INDUSTRIEL ET COMMERCIAL
By: /s/ Anthony Rock
-------------------------------------------
Name: Anothony Rock
Title: Vice President
By: /s/ Sean Mounier
-------------------------------------------
Name: Sean Mounier
Title: First Vice President
193
LENDER:
GSC EUROPEAN CDO I S.A.
By: /s/ Hugo Neuman
-------------------------------------------
Name: Hugo Neuman
Title: Director
194
LENDER:
GSC EUROPEAN CDO II S.A.
By: /s/ Hugo Neuman
-------------------------------------------
Name: Hugo Neuman
Title: Director
195
LENDER:
HENDERSON GLOBAL INVESTORS LIMITED
FOR AND ON BEHALF OF AQUILAE CLO I PLC
By: /s/ David Milward
-------------------------------------------
Name: David Milward
Title: Associate Director
By: /s/ Julian Green
-------------------------------------------
Name: Julian Green
Title: Director
196
LENDER:
HENDERSON GLOBAL INVESTORS LIMITED
FOR AND ON BEHALF OF MELCHIOR CDO I SA
By: /s/ David Milward
-------------------------------------------
Name: David Milward
Title: Associate Director
By: /s/ Julian Green
-------------------------------------------
Name: Julian Green
Title: Director
197
LENDER:
IKB CAPITAL CORPORATION
By: /s/ Wolfgang Boeker
-------------------------------------------
Name: Wolfgang Boeker
Title: Senior Vice President
198
LENDER:
LASALLE BANK NATIONAL ASSOCIATION
By: /s/ James A. Meyer
-------------------------------------------
Name: James A. Meyer
Title: Senior Vice President
199
LENDER:
MERRILL LYNCH CAPITAL CORPORATION
By: /s/ William H. Gates
-------------------------------------------
Name: William H. Gates
Title: Authorized Signatory
200
LENDER:
MFS FLOATING RATE HIGH INCOME FUND
By: /s/ Philip Robbins
-------------------------------------------
Name: Philip Robbins
Title: Vice President
201
LENDER:
NATIONAL CITY BANK
By: /s/ Michael A. Moose
-------------------------------------------
Name: Michael A Moose
Title: Assitant Vice President
202
LENDER:
RMF EURO CDO II S.A.
By: /s/ Hugo Neuman
-------------------------------------------
Name: Hugo Neuman
Title: Director
203
LENDER:
U.S. BANK, NATIONAL ASSOCIATION
By: /s/ Monika K. Kump
-------------------------------------------
Name: Monika K. Kump
Title: Assistant Vice President
204
BANK OF AMERICA, N.A., as
Administrative Agent
By: /s/ Suzanne Chomiczewski
-------------------------------------------
Name: Suzanne Chomiczewski
Title: Vice President
205
BANK OF AMERICA, N.A., as a Lender, L/C
Issuer or Swing Line Lender
By: /s/ Suzanne Chomiczewski
-------------------------------------------
Name: Suzanne Chomiczewski
Title: Vice President
206
Schedule I
KGaA Guarantors
Rayovac Corporation
ROV International Finance Company
Rayovac Europe GmbH
ROV German General Partner GmbH
ROV German Limited GmbH
Schedule II
ROV Guarantors
Rovcal, Inc.
ROV Holding, Inc.
United Industries Corporation
Nu-Gro America Corp.
Nu-Gro US Holdco Corp.
Nu-Gro Technologies, Inc.
IB Nitrogen Inc.
Schultz Company
Ground Zero Inc.
Sylorr Plant Corp.
WPC Brands, Inc.
United Pet Group, Inc.
AQ Holdings, Inc.
Perfecto Holding Corp.
Aquarium Systems, Inc.
Perfecto Manufacturing, Inc.
Jungletalk International, Inc.
Pets 'N People, Inc.
Southern California Foam, Inc.
Aquaria, Inc.
DB Online, LLC
Schedule III
UK Guarantors
Rayovac Corporation
ROV International Finance Company
Rayovac Europe GmbH
Schedule IV
Consolidated EBITDA
[Omitted. A supplemental copy of this schedule will be
furnished to the SEC upon request.]
Schedule V
Existing Letters of Credit
[Omitted. A supplemental copy of this schedule will be
furnished to the SEC upon request.]
Schedule 2.01
Commitments and Applicable Percentages
[Omitted. A supplemental copy of this schedule will be
furnished to the SEC upon request.]
Schedule 5.05
Supplement to Interim Financial Statements
[Omitted. A supplemental copy of this schedule will be
furnished to the SEC upon request.]
Schedule 5.06
Litigation
[Omitted. A supplemental copy of this schedule will be
furnished to the SEC upon request.]
Schedule 5.08(b)
Owned Real Property
[Omitted. A supplemental copy of this schedule will be
furnished to the SEC upon request.]
Schedule 5.08(c)
Leased Real Property
[Omitted. A supplemental copy of this schedule will be
furnished to the SEC upon request.]
Schedule 5.09
Environmental Matters
[Omitted. A supplemental copy of this schedule will be
furnished to the SEC upon request.]
Schedule 5.13
Subsidiaries and Other Equity Investments; Loan Parties
[Omitted. A supplemental copy of this schedule will be
furnished to the SEC upon request.]
Schedule 5.16
Intellectual Property Claims
[Omitted. A supplemental copy of this schedule will be
furnished to the SEC upon request.]
Schedule 6.18
Real Property to be Mortgaged
[Omitted. A supplemental copy of this schedule will be
furnished to the SEC upon request.]
Schedule 7.01(b)
Existing Permitted Liens
[Omitted. A supplemental copy of this schedule will be
furnished to the SEC upon request.]
Schedule 7.02
Indebtedness
[Omitted. A supplemental copy of this schedule will be
furnished to the SEC upon request.]
Schedule 7.03(f)
Existing Permitted Investments
[Omitted. A supplemental copy of this schedule will be
furnished to the SEC upon request.]
Schedule 7.05(m)
Certain Dispositions
[Omitted. A supplemental copy of this schedule will be
furnished to the SEC upon request.]
Schedule 7.08
Certain Transactions with Affiliates
[Omitted. A supplemental copy of this schedule will be
furnished to the SEC upon request.]
Schedule 10.02
Administrative Agent's Office, Certain Addresses for Notices
[Omitted. A supplemental copy of this schedule will be
furnished to the SEC upon request.]
Schedule 10.06
Processing and Recordation Fees
[Omitted. A supplemental copy of this schedule will be
furnished to the SEC upon request.]
Exhibit A
Form of Committed Loan Notice
[Omitted. A supplemental copy of this exhibit will be
furnished to the SEC upon request.]
Exhibit B
Form of Swing Line Loan Notice
[Omitted. A supplemental copy of this exhibit will be
furnished to the SEC upon request.]
Exhibit C-1
Form of Term Note
[Omitted. A supplemental copy of this exhibit will be
furnished to the SEC upon request.]
Exhibit C-2
Form of U.S. Revolving Credit Note
[Omitted. A supplemental copy of this exhibit will be
furnished to the SEC upon request.]
Exhibit C-3
Form of Euro Revolving Term Note
[Omitted. A supplemental copy of this exhibit will be
furnished to the SEC upon request.]
Exhibit C-4
Form of UK Revolving Credit Note
[Omitted. A supplemental copy of this exhibit will be
furnished to the SEC upon request.]
Exhibit D
Form of Compliance Certificate
[Omitted. A supplemental copy of this exhibit will be
furnished to the SEC upon request.]
Exhibit E
Form of Assignment and Assumption
[Omitted. A supplemental copy of this exhibit will be
furnished to the SEC upon request.]
Exhibit F-1
Form of ROV Guaranty
[Omitted. A supplemental copy of this exhibit will be
furnished to the SEC upon request.]
Exhibit F-2
Form of KGaA Guaranty
[Omitted. A supplemental copy of this exhibit will be
furnished to the SEC upon request.]
Exhibit F-3
Form of UK Guaranty
[Omitted. A supplemental copy of this exhibit will be
furnished to the SEC upon request.]
Exhibit G
Form of Security Agreement
[Omitted. A supplemental copy of this exhibit will be
furnished to the SEC upon request.]
Exhibit H-1
Form of Mortgage
[Omitted. A supplemental copy of this exhibit will be
furnished to the SEC upon request.]
Exhibit H-2
Form of Third Amendment to Mortgage
[Omitted. A supplemental copy of this exhibit will be
furnished to the SEC upon request.]
Exhibit I-1
Form of Opinion Matters - Counsel to Loan Parties
[Omitted. A supplemental copy of this exhibit will be
furnished to the SEC upon request.]
Exhibit I-2
Form of Opinion Matters - Local Counsel to Loan Parties
[Omitted. A supplemental copy of this exhibit will be
furnished to the SEC upon request.]
Exhibit I-3
Form of Opinion Matters - Real Estate Counsel to Loan Parties
[Omitted. A supplemental copy of this exhibit will be
furnished to the SEC upon request.]
EXHIBIT 10.2
SECURITY AGREEMENT
Dated February 7, 2005
From
The Grantors referred to herein
as Grantors
to
BANK OF AMERICA, N.A.
as Collateral Agent
T A B L E O F C O N T E N T S
Section Page
Section 1. Grant of Security............................................................................2
Section 2. Security for Obligations.....................................................................6
Section 3. Grantors Remain Liable.......................................................................6
Section 4. Delivery and Control of Security Collateral..................................................6
Section 5. Maintaining the Account Collateral...........................................................7
Section 6. Investing of Amounts in the Cash Collateral Accounts.........................................8
Section 7. Release of Amounts...........................................................................8
Section 8. Representations and Warranties...............................................................8
Section 9. Further Assurances..........................................................................10
Section 10. Insurance...................................................................................11
Section 11. Post-Closing Changes; Collections on Assigned Agreements....................................11
Section 12. As to Intellectual Property Collateral......................................................12
Section 13. Voting Rights; Dividends; Etc...............................................................13
Section 14. As to Letter-of-Credit Rights...............................................................14
Section 15. Commercial Tort Claims......................................................................15
Section 16. Transfers and Other Liens; Additional Shares................................................15
Section 17. Collateral Agent Appointed Attorney-in-Fact.................................................15
Section 18. Collateral Agent May Perform................................................................16
Section 19. The Collateral Agent's Duties...............................................................16
Section 20. Remedies....................................................................................16
Section 21. Amendments; Waivers; Additional Grantors; Etc...............................................18
Section 22. Continuing Security Interest; Assignments under the Credit Agreement........................19
Section 23. Release; Termination........................................................................19
Section 24. Execution in Counterparts...................................................................20
Section 25. Governing Law...............................................................................20
Schedules
Schedule I - Investment Property
Schedule II - Intellectual Property
Schedule III - Commercial Tort Claims
Schedule IV - Type Of Organization, Jurisdiction Of Organization
And Organizational Identification Number
Schedule V - Changes in Name, Etc.
Schedule VI - Letters of Credit
Schedule VII - Intellectual Property Matters
Exhibits
Exhibit A - Form of Security Agreement Supplement
Exhibit B - Form of Intellectual Property Security Agreement
Exhibit C - Form of Consent to Assignment of Letter of Credit
Rights
ii
SECURITY AGREEMENT
SECURITY AGREEMENT dated February 7, 2005 made by RAYOVAC
CORPORATION, a Wisconsin corporation (the "U.S. Borrower") and the other
Persons listed on the signature pages hereof (the U.S. Borrower and the
Persons so listed (together with any Additional Grantors (as hereinafter
defined)) being, collectively, the "Grantors"), to BANK OF AMERICA, N.A., as
collateral agent (in such capacity, together with any successor collateral
agent appointed pursuant to Article IX of the Credit Agreement (as hereinafter
defined), the "Collateral Agent") for the Secured Parties (as defined in the
Credit Agreement).
PRELIMINARY STATEMENTS.
(1) The U.S. Borrower has entered into a Fourth Amended and
Restated Credit Agreement dated as of February 7, 2005 (said Agreement, as it
may hereafter be amended, amended and restated, supplemented or otherwise
modified from time to time, being the "Credit Agreement") with the Lenders and
the Administrative Agent (each as defined therein).
(2) Each Grantor is the owner of the shares of stock or
other Equity Interests set forth opposite such Grantor's name on and as
otherwise described in Part I of Schedule I hereto and issued by the Persons
named therein (the "Initial Pledged Equity") and of the indebtedness set forth
opposite such Grantor's name on and as otherwise described in Part II of
Schedule I hereto and issued by the obligors named therein (the "Initial
Pledged Debt").
(3) Pursuant to the terms of the Credit Agreement, upon the
request of the Collateral Agent, the Grantors shall open one or more cash
collateral deposit accounts (the "Cash Collateral Accounts") in the name of
the Collateral Agent and under the sole control and dominion of the Collateral
Agent and subject to the terms of this Agreement.
(4) It is a condition precedent to the making of Loans by
the Lenders and the issuance of Letters of Credit by the L/C Issuer under the
Credit Agreement, the entry into Secured Hedge Agreements by the Hedge Banks
and the entry into Qualified Foreign Credit Facilities by the Qualified
Foreign Lenders from time to time that the Grantors shall have granted the
security interest contemplated by this Agreement. Each Grantor will derive
substantial direct and indirect benefit from the transactions contemplated by
the Loan Documents.
(5) Terms defined in the Credit Agreement and not otherwise
defined in this Agreement are used in this Agreement as defined in the Credit
Agreement. Further, unless otherwise defined in this Agreement or in the
Credit Agreement, terms defined in Article 8 or 9 of the UCC (as defined
below) are used in this Agreement as such terms are defined in such Article 8
or 9. "UCC" means the Uniform Commercial Code as in effect from time to time
in the State of New York; provided that, if perfection or the effect of
perfection or non-perfection or the priority of the security interest in any
Collateral is governed by the Uniform Commercial Code as in effect in a
jurisdiction other than the State of New York, "UCC" means the Uniform
Commercial Code as in effect from time to time in such other jurisdiction for
purposes of the provisions hereof relating to such perfection, effect of
perfection or non-perfection or priority.
1
NOW, THEREFORE, in consideration of the premises and in
order to induce the Lenders to make Loans and the L/C Issuer to issue Letters
of Credit under the Credit Agreement, to induce the Hedge Banks to enter into
Secured Hedge Agreements and to induce the Qualified Foreign Lenders to enter
into Qualified Foreign Credit Facilities from time to time, each Grantor
hereby agrees with the Collateral Agent for the ratable benefit of the Secured
Parties as follows:
Section 1. Grant of Security. Each Grantor hereby grants to
the Collateral Agent, for the ratable benefit of the Secured Parties, a
security interest in such Grantor's right, title and interest in and to the
following, in each case, as to each type of property described below, whether
now owned or hereafter acquired by such Grantor, wherever located, and whether
now or hereafter existing or arising; provided, that notwithstanding anything
in this Agreement to the contrary, in no event shall the security interest
granted hereunder attach to any license, contract, or other agreement to which
U.S. Borrower is a party or any of its rights or interests thereunder, or any
property or assets subject to any license, contract, or other agreement, if
and for so long as the grant of such security interest shall constitute or
result in (x) the abandonment, invalidation or unenforceability of any right,
title or interest of U.S. Borrower therein or (y) in a breach or termination
pursuant to the terms of, or a default under, any such license, contract
right, or other agreement, except, in each case, to the extent that any such
term would be rendered ineffective pursuant to Sections 9-406, 9-407, 9-408 or
9-409 of the UCC (or any successor provision or provisions) of any relevant
jurisdiction or any other applicable law or principles of equity, provided,
however that, notwithstanding the foregoing, such security interest shall
attach immediately at such time as the condition causing such abandonment,
invalidation or unenforceability shall be remedied and, to the extent
severable, shall attached immediately to any portion of such license,
contract, or other agreement, or property subject thereto, that does not
result in any of the consequences specified in clause (x) or (y) above
(collectively, the "Collateral"):
(a) all equipment in all of its forms, including, without
limitation, all machinery, tools, motor vehicles, vessels, aircraft,
furniture and fixtures, and all parts thereof and all accessions
thereto, including, without limitation, computer programs and
supporting information that constitute equipment within the meaning
of the UCC (any and all such property being the "Equipment");
(b) all inventory in all of its forms, including, without
limitation, (i) all raw materials, work in process, finished goods
and materials used or consumed in the manufacture, production,
preparation or shipping thereof, (ii) goods in which such Grantor has
an interest in mass or a joint or other interest or right of any kind
(including, without limitation, goods in which such Grantor has an
interest or right as consignee) and (iii) goods that are returned to
or repossessed or stopped in transit by such Grantor, and all
accessions thereto and products thereof and documents therefor,
including, without limitation, computer programs and supporting
information that constitute inventory within the meaning of the UCC
(any and all such property being the "Inventory");
(c) all accounts (including, without limitation,
health-care-insurance receivables), chattel paper (including, without
limitation, tangible chattel paper and electronic chattel paper),
instruments (including, without
2
limitation, promissory notes), deposit accounts, letter-of-credit
rights, general intangibles (including, without limitation, payment
intangibles) and other obligations of any kind, whether or not
arising out of or in connection with the sale or lease of goods or
the rendering of services and whether or not earned by performance,
and all rights now or hereafter existing in and to all supporting
obligations and in and to all security agreements, mortgages, Liens,
leases, letters of credit and other contracts securing or otherwise
relating to the foregoing property (any and all of such accounts,
chattel paper, instruments, deposit accounts, letter-of-credit
rights, general intangibles and other obligations, to the extent not
referred to in clause (d), (e) or (f) below, being the "Receivables,"
and any and all such supporting obligations, security agreements,
mortgages, Liens, leases, letters of credit and other contracts being
the "Related Contracts");
(d) the following (the "Security Collateral"):
(i) the Initial Pledged Equity and the certificates,
if any, representing the Initial Pledged Equity, and all
dividends, distributions, return of capital, cash,
instruments and other property from time to time received,
receivable or otherwise distributed in respect of or in
exchange for any or all of the Initial Pledged Equity and
all warrants, rights or options issued thereon or with
respect thereto;
(ii) the Initial Pledged Debt and the instruments,
if any, evidencing the Initial Pledged Debt, and all
interest, cash, instruments and other property from time to
time received, receivable or otherwise distributed in
respect of or in exchange for any or all of the Initial
Pledged Debt;
(iii) all additional shares of stock and other
Equity Interests from time to time acquired by such Grantor
in any manner (such shares and other Equity Interests,
together with the Initial Pledged Equity, being the "Pledged
Equity"), and the certificates, if any, representing such
additional shares or other Equity Interests, and all
dividends, distributions, return of capital, cash,
instruments and other property from time to time received,
receivable or otherwise distributed in respect of or in
exchange for any or all of such shares or other Equity
Interests and all warrants, rights or options issued thereon
or with respect thereto; provided that, notwithstanding
anything contained herein to the contrary, such Grantor
shall not be required to pledge, and the terms "Pledged
Equity" and "Security Collateral" used in this Agreement
shall not include, any Equity Interests in any foreign
Subsidiary acquired, owned, or otherwise held by such
Grantor, in each case, that, when aggregated with all of the
other shares of stock in such foreign Subsidiary pledged by
such Grantor, would result in more than 66% of the shares of
stock in such foreign Subsidiary being pledged to the
Collateral Agent for the benefit of the Secured Parties
under this Agreement;
(iv) all additional indebtedness from time to time
owed to such Grantor (such indebtedness, together with the
Initial Pledged Debt, being the "Pledged Debt") and the
instruments, if any, evidencing such indebtedness, and all
interest, cash, instruments and other property from time to
time received, receivable or
3
otherwise distributed in respect of or in exchange for any
or all of such indebtedness;
(v) the Cash Collateral Accounts, all security
entitlements with respect to all financial assets from time
to time credited to the Cash Collateral Accounts, and all
financial assets, and all dividends, distributions, return
of capital, interest, cash, instruments and other property
from time to time received, receivable or otherwise
distributed in respect of or in exchange for any or all of
such security entitlements or financial assets and all
warrants, rights or options issued thereon or with respect
thereto; and
(vi) except for property excluded in clause (iii)
above, all other investment property (including, without
limitation, all (A) securities, whether certificated or
uncertificated, (B) security entitlements, (C) securities
accounts, (D) commodity contracts and (E) commodity
accounts) in which such Grantor has now, or acquires from
time to time hereafter, any right, title or interest in any
manner, and the certificates or instruments, if any,
representing or evidencing such investment property, and all
dividends, distributions, return of capital, interest, cash,
instruments and other property from time to time received,
receivable or otherwise distributed in respect of or in
exchange for any or all of such investment property and all
warrants, rights or options issued thereon or with respect
thereto;
(e) each Hedge Agreement to which such Grantor is now or may
hereafter become a party, in each case as such agreements may be
amended, amended and restated, supplemented or otherwise modified
from time to time (collectively, the "Assigned Agreements"),
including, without limitation, (i) all rights of such Grantor to
receive moneys due and to become due under or pursuant to the
Assigned Agreements, (ii) all rights of such Grantor to receive
proceeds of any insurance, indemnity, warranty or guaranty with
respect to the Assigned Agreements, (iii) claims of such Grantor for
damages arising out of or for breach of or default under the Assigned
Agreements and (iv) the right of such Grantor to terminate the
Assigned Agreements, to perform thereunder and to compel performance
and otherwise exercise all remedies thereunder (all such Collateral
being the "Agreement Collateral");
(f) the following (collectively, the "Account Collateral"):
(i) the Cash Collateral Accounts, all deposit
accounts and all funds and financial assets from time to
time credited thereto (including, without limitation, all
Cash Equivalents), and all certificates and instruments, if
any, from time to time representing or evidencing the Cash
Collateral Accounts or any other deposit account;
(ii) all promissory notes, certificates of deposit,
checks and other instruments from time to time delivered to
or otherwise possessed by the Collateral Agent for or on
behalf of such Grantor in substitution for or in addition to
any or all of the then existing Account Collateral; and
4
(iii) all interest, dividends, distributions, cash,
instruments and other property from time to time received,
receivable or otherwise distributed in respect of or in
exchange for any or all of the then existing Account
Collateral;
(g) the following (collectively, the "Intellectual Property
Collateral"):
(i) all patents, patent applications, utility models
and statutory invention registrations, all inventions
claimed or disclosed therein and all improvements thereto
("Patents");
(ii) all trademarks, service marks, domain names,
trade dress, logos, designs, slogans, trade names, business
names, corporate names and other source identifiers, whether
registered or unregistered (provided that no security
interest shall be granted in United States intent-to-use
trademark applications), together, in each case, with the
goodwill symbolized thereby ("Trademarks");
(iii) all copyrights, including, without limitation,
copyrights in Computer Software (as hereinafter defined),
internet web sites and the content thereof, whether
registered or unregistered ("Copyrights");
(iv) all computer software, programs and databases
(including, without limitation, source code, object code and
all related applications and data files), firmware and
documentation and materials relating thereto, together with
any and all maintenance rights, service rights, programming
rights, hosting rights, test rights, improvement rights,
renewal rights and indemnification rights and any
substitutions, replacements, improvements, error
corrections, updates and new versions of any of the
foregoing ("Computer Software");
(v) all confidential and proprietary information,
including, without limitation, know-how, trade secrets,
manufacturing and production processes and techniques,
inventions, research and development information, databases
and data, including, without limitation, technical data,
financial, marketing and business data, pricing and cost
information, business and marketing plans and customer and
supplier lists and information (collectively, "Trade
Secrets"), and all other intellectual, industrial and
intangible property of any type, including, without
limitation, industrial designs and mask works;
(vi) all registrations and applications for
registration for any of the foregoing, including, without
limitation, those registrations and applications for
registration set forth in Schedule II hereto, together with
all reissues, divisions, continuations,
continuations-in-part, extensions, renewals and
reexaminations thereof;
(vii) all tangible embodiments of the foregoing, all
rights in the foregoing provided by international treaties
or conventions, all rights corresponding thereto throughout
the world and all other rights of any kind whatsoever of
such Grantor accruing thereunder or pertaining thereto;
5
(viii) all agreements, permits, consents, orders and
franchises relating to the license, development, use or
disclosure of any of the foregoing to which such Grantor,
now or hereafter, is a party or a beneficiary; and
(ix) any and all claims for damages and injunctive
relief for past, present and future infringement, dilution,
misappropriation, violation, misuse or breach with respect
to any of the foregoing, with the right, but not the
obligation, to sue for and collect, or otherwise recover,
such damages;
(h) all commercial tort claims, including, without
limitation, the commercial tort claims described in Schedule III
hereto (collectively, the "Commercial Tort Claims Collateral");
(i) all books and records (including, without limitation,
customer lists, credit files, printouts and other computer output
materials and records) of such Grantor pertaining to any of the
Collateral; and
(j) all proceeds of, collateral for, income, royalties and
other payments now or hereafter due and payable with respect to, and
supporting obligations relating to, any and all of the Collateral
(including, without limitation, proceeds, collateral and supporting
obligations that constitute property of the types described in
clauses (a) through (i) of this Section 1) and, to the extent not
otherwise included, all (A) payments under insurance (whether or not
the Collateral Agent is the loss payee thereof), or any indemnity,
warranty or guaranty, payable by reason of loss or damage to or
otherwise with respect to any of the foregoing Collateral, and (B)
cash.
Section 2. Security for Obligations. This Agreement secures,
in the case of each Grantor, the payment of all Obligations of such Grantor
now or hereafter existing under the Loan Documents (all such Obligations being
the "Secured Obligations").
Section 3. Grantors Remain Liable. Anything herein to the
contrary notwithstanding, (a) each Grantor shall remain liable under the
contracts and agreements included in such Grantor's Collateral to the extent
set forth therein to perform all of its duties and obligations thereunder to
the same extent as if this Agreement had not been executed, (b) the exercise
by the Collateral Agent of any of the rights hereunder shall not release any
Grantor from any of its duties or obligations under the contracts and
agreements included in the Collateral and (c) no Secured Party shall have any
obligation or liability under the contracts and agreements included in the
Collateral by reason of this Agreement or any other Loan Document, nor shall
any Secured Party be obligated to perform any of the obligations or duties of
any Grantor thereunder or to take any action to collect or enforce any claim
for payment assigned hereunder.
Section 4. Delivery and Control of Security Collateral. (a)
All certificates or instruments representing or evidencing Security Collateral
shall be delivered to and held by or on behalf of the Collateral Agent
pursuant hereto and shall be in suitable form for transfer by delivery, or
shall be accompanied by duly executed instruments of transfer or assignment in
blank, all in form and substance reasonably satisfactory to the Collateral
Agent; provided, that, (i) so long as no Event of Default has occurred and is
continuing and the enforcement by the
6
Secured Parties of their rights and remedies under the Loan Documents is not
continuing, no Grantor shall be required to deliver any instrument
representing Pledged Debt if the amount of such Pledged Debt is less than
$5,000,000, and (ii) so long as no Event of Default under Section 8.01(a) or
8.01(f) of the Credit Agreement shall have occurred and be continuing, no
Grantor shall be required to deliver any bills of lading, waybills, airbills
or similar documents of title evidencing the receipt of goods for shipment.
Upon the occurrence and during the continuance of an Event of Default and the
enforcement by the Secured Parties of their rights and remedies under the Loan
Documents, the Collateral Agent shall have the right at any time to exchange
certificates or instruments representing or evidencing Security Collateral for
certificates or instruments of smaller or larger denominations.
(b) With respect to (i) any Security Collateral that
constitutes Pledged Equity and (ii) upon the occurrence and during the
continuance of an Event of Default, all other Security Collateral that, in
each case, constitutes an uncertificated security, the relevant Grantor will
cause the issuer thereof upon, in the case of clause (ii), the request of the
Collateral Agent either (A) to register the Collateral Agent as the registered
owner of such security or (B) to agree with such Grantor and the Collateral
Agent that such issuer will comply with instructions with respect to such
security originated by the Collateral Agent without further consent of such
Grantor, such agreement to be in form and substance reasonably satisfactory to
the Collateral Agent (an "Uncertificated Security Control Agreement").
(c) Upon the occurrence and during the continuance of an
Event of Default, with respect to any Security Collateral that constitutes a
security entitlement as to which the financial institution acting as
Collateral Agent hereunder is not the securities intermediary, upon the
request of the Collateral Agent the relevant Grantor will cause the securities
intermediary with respect to such security entitlement either (A) to identify
in its records the Collateral Agent as the entitlement holder thereof or (B)
to agree with such Grantor and the Collateral Agent that such securities
intermediary will comply with entitlement orders originated by the Collateral
Agent without further consent of such Grantor, such agreement to be in form
and substance reasonably satisfactory to the Collateral Agent (a "Securities
Account Control Agreement").
(d) Upon the request of the Collateral Agent following the
occurrence and during the continuance of an Event of Default, each Grantor
will notify each issuer of Securities Collateral granted by it hereunder that
such Securities Collateral is subject to the security interest granted
hereunder.
Section 5. Maintaining the Account Collateral. So long as
the Termination Date (as defined in Section 22) shall not have occurred:
(a) The Collateral Agent shall have sole right to direct the
disposition of funds with respect to the Cash Collateral Accounts, as
permitted by the Credit Agreement; and it shall be a term and
condition of each of the Cash Collateral Accounts, notwithstanding
any term or condition to the contrary in any other agreement relating
to such Cash Collateral Account, that after the occurrence and during
the continuance of an Event of Default no amount (including, without
limitation, interest on Cash Equivalents credited thereto) will be
paid or released to or for the account of, or withdrawn by or for the
account of, the U.S. Borrower or any other Person from any Cash
Collateral Account.
7
(b) Each Grantor shall maintain its domestic Cash Collateral
Accounts, if any, only with Bank of America, N.A.
(c) Upon the occurrence and during the continuance of an
Event of Default upon the request of the Collateral Agent and as soon
as practicable, each Grantor shall maintain all other deposit
accounts requested by the Collateral Agent only with Bank of America,
N.A. or with a bank (a "Pledged Account Bank") that has agreed with
such Grantor and the Collateral Agent to (A) comply with instructions
originated by the Collateral Agent directing the disposition of funds
in such other deposit account without the further consent of such
Grantor and (B) waive or subordinate in favor of the Collateral Agent
all claims of such Pledged Account Bank to such other deposit
account, such agreement to be in form and substance reasonably
satisfactory to the Collateral Agent (a "Deposit Account Control
Agreement").
(d) The Collateral Agent may, at any time and without notice
to, or consent from, the applicable Grantor, transfer, or direct the
transfer of, funds from the Cash Collateral Accounts or any other
deposit accounts of such Grantor to satisfy such Grantor's
Obligations under the Loan Documents if an Event of Default shall
have occurred and be continuing.
Section 6. Investing of Amounts in the Cash Collateral
Accounts. The Collateral Agent will, as requested by the applicable Grantor
and subject to the provisions of Sections 5, 7 and 20, from time to time, so
long as no Event of Default has occurred and is continuing invest amounts
received with respect to the Cash Collateral Accounts in such Cash Equivalents
credited to the Cash Collateral Accounts as the applicable Grantor may select
and the Collateral Agent may approve and (b) invest interest paid on the Cash
Equivalents referred to in clause (a) above, and reinvest other proceeds of
any such Cash Equivalents that may mature or be sold, in each case, in such
Cash Equivalents. Interest and proceeds that are not invested or reinvested in
Cash Equivalents as provided above shall be deposited and held in the Cash
Collateral Accounts. In addition, the Collateral Agent shall have the right at
any time to exchange such Cash Equivalents for similar Cash Equivalents of
smaller or larger determinations, or for other Cash Equivalents, credited to
the Cash Collateral Accounts.
Section 7. Release of Amounts. So long as no Default or
Event of Default shall have occurred and be continuing, the Collateral Agent
will, at the U.S. Borrower's request, refund to the U.S. Borrower or at its
order or, at the request of the U.S. Borrower, to the Administrative Agent to
be applied to the Obligations of the Grantors under the Loan Documents, such
amount, if any, as is then on deposit in the Cash Collateral Accounts to the
extent permitted to be released under the terms of the Credit Agreement.
Section 8. Representations and Warranties. Each Grantor
represents and warrants as follows:
(a) As of the Closing Date, such Grantor's exact legal name,
type of organization, jurisdiction of organization and organizational
identification number is set forth in Schedule IV hereto. As of the
Closing Date, such Grantor has no trade names other than as listed on
Schedule V hereto. Within the two years preceding the date
8
hereof, except as set forth in Schedule V hereto, such Grantor has not changed
its name, type of organization, jurisdiction of organization or organizational
identification number from those set forth in Schedule IV hereto.
(b) Such Grantor is the legal and beneficial owner of the
Collateral granted or purported to be granted by it free and clear of
any Lien, claim, option or right of others, except for the Permitted
Liens. No effective financing statement or other instrument similar
in effect covering all or any part of such Collateral or listing such
Grantor or any trade name of such Grantor as debtor is on file in any
recording office, except such as may have been filed in favor of the
Collateral Agent relating to the Loan Documents or as otherwise
permitted under the Credit Agreement.
(c) If such Grantor is an issuer of Security Collateral,
such Grantor confirms that it has received notice of the security
interest granted hereunder.
(d) As of the Closing Date, the Initial Pledged Equity
pledged by such Grantor constitutes the percentage of the issued and
outstanding Equity Interests of the issuers thereof indicated on
Schedule I hereto. As of the Closing Date, the Initial Pledged Debt
constitutes all of the outstanding indebtedness owed to such Grantor
by the issuers thereof and is outstanding in the principal amount
indicated on Schedule I hereto.
(e) As of the Closing Date, such Grantor is not a
beneficiary or assignee under any letter of credit, other than the
letters of credit described in Schedule VI hereto and additional
letters of credit as to which such Grantor has complied with the
requirements of Section 14.
(f) This Agreement creates in favor of the Collateral Agent
for the benefit of the Secured Parties a valid security interest in
the Collateral granted by such Grantor, securing the payment of the
Secured Obligations; all filings and other actions necessary to
perfect the security interest in the Collateral granted by such
Grantor have been duly made or taken and are in full force and
effect.
(g) Except as could not reasonably be expected to have a
Material Adverse Effect:
(i) The Intellectual Property Collateral set forth
on Schedule II hereto includes all of the patent
registrations, domain names, trademark registrations and
applications and copyright registrations and applications
owned by such Grantor as of the Closing Date.
(ii) To such Grantor's knowledge, the Intellectual
Property Collateral is valid and enforceable except as
listed on Schedule VII.
(iii) Such Grantor has made or performed all
filings, recordings and other acts and has paid all required
fees and taxes to maintain and protect its interest in its
Intellectual Property Collateral in full force and effect.
9
Section 9. Further Assurances. (a) Each Grantor agrees that
from time to time, at the expense of such Grantor, such Grantor will promptly
take all further action that may be necessary, or that the Collateral Agent
may reasonably request, in order to perfect and protect any pledge or security
interest granted by such Grantor hereunder or to enable the Collateral Agent
to exercise and enforce its rights and remedies hereunder with respect to any
Collateral of such Grantor. Without limiting the generality of the foregoing,
each Grantor will promptly with respect to Collateral of such Grantor: (i) if
any such Collateral shall be evidenced by a promissory note or other
instrument (with respect to Pledged Debt, in an amount greater than
$5,000,000), deliver and pledge to the Collateral Agent hereunder such note or
instrument duly indorsed and accompanied by duly executed instruments of
transfer or assignment, all in form and substance reasonably satisfactory to
the Collateral Agent; (ii) execute or authenticate and file such financing or
continuation statements, or amendments thereto, and such other instruments or
notices, as may be commercially reasonable, or as the Collateral Agent may
reasonably request, in order to perfect and preserve the security interest
granted or purported to be granted by such Grantor hereunder; (iii) at the
request of the Collateral Agent, take all commercially reasonable action to
ensure that the Collateral Agent's security interest is noted on any
certificate of title related to any Collateral evidenced by a certificate of
title; (iv) upon the occurrence and during the continuance of an Event of
Default, (A) take all commercially reasonable action necessary to ensure that
the Collateral Agent has control of Collateral consisting of deposit accounts,
investment property and letter-of-credit rights as provided in Sections 9-104,
9-106 and 9-107 of the UCC and (B) promptly upon reasonable request of the
Collateral Agent, cause the Collateral Agent to be the beneficiary under all
letters of credit that constitute Collateral, with the exclusive right to make
all draws under such letters of credit, and with all rights of a transferee
under Section 5-114(e) of the UCC; and (v) deliver to the Collateral Agent
evidence that other commercially reasonable actions that the Collateral Agent
may request in order to perfect and protect the security interest granted or
purported to be granted by such Grantor under this Agreement have been taken.
(b) Each Grantor hereby authorizes the Collateral Agent to
file one or more financing or continuation statements, and amendments thereto,
including, without limitation, one or more financing statements indicating
that such financing statements cover all assets or all personal property (or
words of similar effect) of such Grantor, in each case without the signature
of such Grantor, and regardless of whether any particular asset described in
such financing statements falls within the scope of the UCC or the granting
clause of this Agreement. A photocopy or other reproduction of this Agreement
shall be sufficient as a financing statement where permitted by law. Each
Grantor ratifies its authorization for the Collateral Agent to have filed such
financing statements, continuation statements or amendments filed prior to the
date hereof.
(c) Each Grantor will furnish to the Collateral Agent from
time to time statements and schedules further identifying and describing the
Collateral of such Grantor and such other reports in connection with such
Collateral as the Collateral Agent may reasonably request, all in reasonable
detail.
Section 10. Insurance. (a) Each Grantor will, at its own
expense, maintain insurance with respect to its Equipment and Inventory in the
manner required by the Credit Agreement. Each policy of each Grantor for
liability insurance shall provide for all losses to be
10
paid on behalf of the Collateral Agent and such Grantor as their interests may
appear. Each such policy shall in addition (i) name such Grantor and the
Collateral Agent as insured parties thereunder (without any representation or
warranty by or obligation upon the Collateral Agent) as their interests may
appear and (iv) provide that at least 10 days' prior written notice of
cancellation or of lapse shall be given to the Collateral Agent by the
insurer.
(b) Reimbursement under any liability insurance maintained
by any Grantor pursuant to this Section 10 may be paid directly to the Person
who shall have incurred liability covered by such insurance.
(c) So long as no Event of Default shall have occurred and
be continuing, all insurance payments received by the Collateral Agent in
connection with any loss, damage or destruction of any Inventory or Equipment
will be released by the Collateral Agent to the applicable Grantor for use in
accordance with the terms of the Credit Agreement. Upon the occurrence and
during the continuance of any Event of Default, all insurance payments in
respect of such Equipment or Inventory shall be paid to the Collateral Agent
and shall, in the Collateral Agent's sole discretion, (i) be released to the
applicable Grantor to be applied as set forth in the first sentence of this
subsection (c) or (ii) be held as additional Collateral hereunder or applied
as specified in Section 20(b).
Section 11. Post-Closing Changes; Collections on Assigned
Agreements. (a) No Grantor will change its name, type of organization,
jurisdiction of organization or organizational identification number from
those set forth in Section 8(a) of this Agreement without first giving at
least 20 days' prior written notice to the Collateral Agent and taking all
action required by the Collateral Agent for the purpose of perfecting or
protecting the security interest granted by this Agreement. If any Grantor
does not have an organizational identification number and later obtains one,
it will forthwith notify the Collateral Agent of such organizational
identification number.
(b) Except as otherwise provided in this subsection (b),
each Grantor will continue to collect, at its own expense, all amounts due or
to become due such Grantor under the Assigned Agreements. In connection with
such collections, such Grantor may take (and, at the Collateral Agent's
direction, will take) such commercially reasonable action as such Grantor or
the Collateral Agent may deem necessary to enforce collection of the Assigned
Agreements; provided, however, that the Collateral Agent shall have the right
at any time, upon the occurrence and during the continuance of an Event of
Default and the enforcement by the Secured Parties of their rights and
remedies under the Loan Documents, and upon written notice to such Grantor of
its intention to do so, to notify the Obligors under any Assigned Agreements
of the assignment of such Assigned Agreements to the Collateral Agent and to
direct such Obligors to make payment of all amounts due or to become due to
such Grantor thereunder directly to the Collateral Agent and, upon such
notification and at the expense of such Grantor, to enforce collection of any
such Assigned Agreements, to adjust, settle or compromise the amount or
payment thereof, in the same manner and to the same extent as such Grantor
might have done, and to otherwise exercise all rights with respect to such
Assigned Agreements, including, without limitation, those set forth set forth
in Section 9-607 of the UCC. After receipt by any Grantor of the notice from
the Collateral Agent referred to in the proviso to the preceding sentence, (i)
all amounts and proceeds (including, without limitation, instruments) received
by such Grantor in respect of the
11
Assigned Agreements of such Grantor shall be received in trust for the benefit
of the Collateral Agent hereunder, shall be segregated from other funds of
such Grantor and shall be forthwith paid over to the Collateral Agent in the
same form as so received (with any necessary indorsement) and either (A)
released to such Grantor on the terms set forth in the Credit Agreement so
long as no Event of Default shall have occurred and be continuing and
enforcement by the Secured Parties of their rights and remedies under the Loan
Documents is not continuing or (B) if any Event of Default shall have occurred
and be continuing and enforcement by the Secured Parties of their rights and
remedies under the Loan Documents is continuing, applied as provided in
Section 20(b) and (ii) such Grantor will not adjust, settle or compromise the
amount or payment of any amount due on any Assigned Agreement, release wholly
or partly any Obligor thereof, or allow any credit or discount thereon.
Section 12. As to Intellectual Property Collateral. (a) With
respect to each item of its Intellectual Property Collateral, each Grantor
agrees to take, at its expense, all commercially reasonable steps, including,
without limitation, in the U.S. Patent and Trademark Office, the U.S.
Copyright Office and any other governmental authority, to maintain the
validity and enforceability of such Intellectual Property Collateral and
maintain such Intellectual Property Collateral in full force and effect,
except to the extent its failure to do so could not reasonably be expected to
have a Material Adverse Effect.
(b) Except in the ordinary course of its business or as
could not be reasonably expected to have a Material Adverse Effect, no Grantor
shall do or permit any act or knowingly omit to do any act whereby any of its
Intellectual Property Collateral may lapse or become invalid or unenforceable
or placed in the public domain.
(c) Except where failure to do so could not reasonably be
expected to cause a Material Adverse Effect, each Grantor shall take all
commercially reasonable steps which it or the Collateral Agent (upon the
occurrence and during the continuance of an Event of Default) deems reasonable
and appropriate under the circumstances to preserve and protect each item of
its Intellectual Property Collateral.
(d) With respect to its Intellectual Property Collateral,
each Grantor agrees to execute or otherwise authenticate an agreement, in
substantially the form set forth in Exhibit B hereto or otherwise in form and
substance reasonably satisfactory to the Collateral Agent (an "Intellectual
Property Security Agreement"), for recording the security interest granted
hereunder to the Collateral Agent in such Intellectual Property Collateral
with the U.S. Patent and Trademark Office, the U.S. Copyright Office and any
other governmental authorities necessary to perfect the security interest
hereunder in such Intellectual Property Collateral.
(e) Each Grantor agrees that should it obtain an ownership
interest in any item of the type set forth in Section 1(g) that is not on the
date hereof a part of the Intellectual Property Collateral ("After-Acquired
Intellectual Property") (i) the provisions of this Agreement shall
automatically apply thereto, and (ii) any such After-Acquired Intellectual
Property and, in the case of trademarks, the goodwill symbolized thereby,
shall automatically become part of the Intellectual Property Collateral
subject to the terms and conditions of this Agreement with respect thereto.
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Section 13. Voting Rights; Dividends; Etc. (a) So long as no
Event of Default shall have occurred and be continuing and the enforcement by
the Secured Parties of their rights and remedies under the Loan Documents is
not continuing:
(i) Each Grantor shall be entitled to exercise any and all
voting and other consensual rights pertaining to the Security
Collateral of such Grantor or any part thereof for any purpose;
provided however, that such Grantor will not exercise or refrain from
exercising any such right if such action would have a material
adverse effect on the value of the Security Collateral or any part
thereof.
(ii) Each Grantor shall be entitled to receive and retain
any and all dividends, interest and other distributions paid in
respect of the Security Collateral of such Grantor if and to the
extent that the payment thereof is not otherwise prohibited by the
terms of the Loan Documents; provided, however, that upon the
enforcement by the Secured Parties of their rights and remedies under
the Loan Documents, any and all
(A) dividends, interest and other distributions paid
or payable other than in cash in respect of, and instruments
and other property received, receivable or otherwise
distributed in respect of, or in exchange for, any Security
Collateral,
(B) dividends and other distributions paid or
payable in cash in respect of any Security Collateral in
connection with a partial or total liquidation or
dissolution or in connection with a reduction of capital,
capital surplus or paid-in-surplus and
(C) cash paid, payable or otherwise distributed in
respect of principal of, or in redemption of, or in exchange
for, any Security Collateral
shall be, and shall be forthwith delivered to the Collateral Agent to
hold as, Security Collateral and shall, if received by such Grantor,
be received in trust for the benefit of the Collateral Agent, be
segregated from the other property or funds of such Grantor and be
forthwith delivered to the Collateral Agent as Security Collateral in
the same form as so received (with any necessary indorsement).
(iii) The Collateral Agent will execute and deliver (or
cause to be executed and delivered) to each Grantor all such proxies
and other instruments as such Grantor may reasonably request for the
purpose of enabling such Grantor to exercise the voting and other
rights that it is entitled to exercise pursuant to paragraph (i)
above and to receive the dividends or interest payments that it is
authorized to receive and retain pursuant to paragraph (ii) above.
(b) Upon the occurrence and during the continuance of an
Event of Default and the enforcement by the Secured Parties of their rights
and remedies under the Loan Documents:
(i) All rights of each Grantor (x) to exercise or refrain
from exercising the voting and other consensual rights that it would
otherwise be entitled to exercise pursuant to Section 13(a)(i) shall,
upon notice to such Grantor by the Collateral Agent, cease and
13
(y) to receive the dividends, interest and other distributions that
it would otherwise be authorized to receive and retain pursuant to
Section 13(a)(ii) shall automatically cease, and all such rights
shall thereupon become vested in the Collateral Agent, which shall
thereupon have the sole right to exercise or refrain from exercising
such voting and other consensual rights and to receive and hold as
Security Collateral such dividends, interest and other distributions.
(ii) All dividends, interest and other distributions that
are received by any Grantor contrary to the provisions of paragraph
(i) of this Section 13(b) shall be received in trust for the benefit
of the Collateral Agent, shall be segregated from other funds of such
Grantor and shall be forthwith paid over to the Collateral Agent as
Security Collateral in the same form as so received (with any
necessary indorsement).
Section 14. As to Letter-of-Credit Rights. (a) Each Grantor,
by granting a security interest in its Receivables consisting of
letter-of-credit rights to the Collateral Agent, intends to (and hereby does)
assign to the Collateral Agent its rights (including its contingent rights) to
the proceeds of all Related Contracts consisting of letters of credit of which
it is or hereafter becomes a beneficiary or assignee. Upon the occurrence and
during the continuance of an Event of Default, each Grantor will, upon the
request of the Collateral Agent, promptly use commercially reasonable efforts
to cause the issuer of each letter of credit and each nominated person (if
any) with respect thereto to consent to such assignment of the proceeds
thereof pursuant to a consent in substantially the form of the Consent to
Assignment of Letter of Credit Rights attached hereto as Exhibit C or
otherwise in form and substance reasonably satisfactory to the Collateral
Agent and deliver written evidence of such consent to the Collateral Agent.
(b) Upon the occurrence and during the continuance of an
Event of Default, each Grantor will, promptly upon request by the Collateral
Agent, (i) notify (and such Grantor hereby authorizes the Collateral Agent to
notify) the issuer and each nominated person with respect to each of the
Related Contracts consisting of letters of credit that the proceeds thereof
have been assigned to the Collateral Agent hereunder and any payments due or
to become due in respect thereof are to be made directly to the Collateral
Agent or its designee and (ii) arrange for the Collateral Agent to become the
transferee beneficiary of letter of credit.
Section 15. Commercial Tort Claims. Each Grantor will
promptly give notice to the Collateral Agent of any commercial tort claim that
may arise after the date hereof and will otherwise take all necessary action
to subject such commercial tort claim to the first priority security interest
created under this Agreement.
Section 16. Transfers and Other Liens; Additional Shares.
(a) Each Grantor agrees that it will not (i) sell, assign or otherwise dispose
of, or grant any option with respect to, any of the Collateral, other than
sales, assignments and other dispositions of Collateral, and options relating
to Collateral, permitted under the terms of the Credit Agreement, or (ii)
create or suffer to exist any Lien upon or with respect to any of the
Collateral of such Grantor except for Permitted Liens.
(b) Each Grantor agrees that it will (i) cause each issuer
of the Pledged Equity pledged by such Grantor not to issue any Equity
Interests or other securities or in substitution for
14
the Pledged Equity issued by such issuer, except to such Grantor, and (ii)
pledge hereunder, immediately upon its acquisition (directly or indirectly)
thereof, any and all additional Equity Interests or other securities.
Section 17. Collateral Agent Appointed Attorney-in-Fact.
Each Grantor hereby irrevocably appoints the Collateral Agent such Grantor's
attorney-in-fact, with full authority in the place and stead of such Grantor
and in the name of such Grantor or otherwise, from time to time, upon the
occurrence and during the continuance of an Event of Default, in the
Collateral Agent's discretion, to take any action and to execute any
instrument that the Collateral Agent may deem necessary or advisable to
accomplish the purposes of this Agreement, including, without limitation:
(a) to obtain and adjust insurance required to be paid to
the Collateral Agent pursuant to Section 10,
(b) to ask for, demand, collect, sue for, recover,
compromise, receive and give acquittance and receipts for moneys due
and to become due under or in respect of any of the Collateral,
(c) to receive, indorse and collect any drafts or other
instruments, documents and chattel paper, in connection with clause
(a) or (b) above, and
(d) to file any claims or take any action or institute any
proceedings that the Collateral Agent deems reasonably necessary or
desirable for the collection of any of the Collateral or otherwise to
enforce compliance with the terms and conditions of any Assigned
Agreement or the rights of the Collateral Agent with respect to any
of the Collateral.
Section 18. Collateral Agent May Perform. If any Grantor
fails to perform any agreement contained herein, the Collateral Agent may, as
the Collateral Agent deems necessary to protect the security interest granted
hereunder in the Collateral or to protect the value thereof, but without any
obligation to do so and without notice, itself perform, or cause performance
of, such agreement, and the expenses of the Collateral Agent incurred in
connection therewith shall be payable by such Grantor under Section 10.04 of
the Credit Agreement.
Section 19. The Collateral Agent's Duties. The powers
conferred on the Collateral Agent hereunder are solely to protect the Secured
Parties' interest in the Collateral and shall not impose any duty upon it to
exercise any such powers. Except for the safe custody of any Collateral in its
possession and the accounting for moneys actually received by it hereunder,
the Collateral Agent shall have no duty as to any Collateral, as to
ascertaining or taking action with respect to calls, conversions, exchanges,
maturities, tenders or other matters relative to any Collateral, whether or
not any Secured Party has or is deemed to have knowledge of such matters, or
as to the taking of any necessary steps to preserve rights against any parties
or any other rights pertaining to any Collateral. The Collateral Agent shall
be deemed to have exercised reasonable care in the custody and preservation of
any Collateral in its possession if such Collateral is accorded treatment
substantially equal to that which it accords its own property.
15
Section 20. Remedies. If any Event of Default shall have
occurred and be continuing:
(a) The Collateral Agent may exercise in respect of the
Collateral, in addition to other rights and remedies provided for
herein or otherwise available to it, all the rights and remedies of a
secured party upon default under the UCC (whether or not the UCC
applies to the affected Collateral) and also may: (i) require each
Grantor to, and each Grantor hereby agrees that it will at its
expense and upon request of the Collateral Agent forthwith, assemble
all or part of the Collateral as directed by the Collateral Agent and
make it available to the Collateral Agent at a place and time to be
designated by the Collateral Agent that is reasonably convenient to
both parties; (ii) without notice except as specified below, sell the
Collateral or any part thereof in one or more parcels at public or
private sale, at any of the Collateral Agent's offices or elsewhere,
for cash, on credit or for future delivery, and upon such other terms
as the Collateral Agent may deem commercially reasonable; (iii)
occupy any premises owned or, to the fullest extent lawful and
permitted, leased by any of the Grantors where the Collateral or any
part thereof is assembled or located for a reasonable period in order
to effectuate its rights and remedies hereunder or under law, without
obligation to such Grantor in respect of such occupation; and (iv)
exercise any and all rights and remedies of any of the Grantors under
or in connection with the Collateral, or otherwise in respect of the
Collateral, including, without limitation, (A) any and all rights of
such Grantor to demand or otherwise require payment of any amount
under, or performance of any provision of, the Assigned Agreements,
the Receivables, the Related Contracts and the other Collateral, (B)
withdraw, or cause or direct the withdrawal, of all funds with
respect to the Account Collateral and (C) exercise all other rights
and remedies with respect to the Receivables, the Related Contracts
and the other Collateral, including, without limitation, those set
forth in Section 9-607 of the UCC. Each Grantor agrees that, to the
extent notice of sale shall be required by law, at least ten days'
notice to such Grantor of the time and place of any public sale or
the time after which any private sale is to be made shall constitute
reasonable notification. The Collateral Agent shall not be obligated
to make any sale of Collateral regardless of notice of sale having
been given. The Collateral Agent may adjourn any public or private
sale from time to time by announcement at the time and place fixed
therefor, and such sale may, without further notice, be made at the
time and place to which it was so adjourned.
(b) Any cash held by or on behalf of the Collateral Agent
and all cash proceeds received by or on behalf of the Collateral
Agent in respect of any sale of, collection from, or other
realization upon all or any part of the Collateral may, in the
discretion of the Collateral Agent, be held by the Collateral Agent
as collateral for, and/or then or at any time thereafter applied
(after payment of any amounts payable to the Collateral Agent
pursuant to Section 10 of the Credit Agreement) in whole or in part
by the Collateral Agent for the ratable benefit of the Secured
Parties against, all or any part of the Secured Obligations, in
accordance with the waterfall set forth in Section 8.03 of the Credit
Agreement. Any surplus of such cash or cash proceeds held by or on
the behalf of the Collateral Agent and remaining after payment in
full of all the Secured Obligations shall be paid over to the
applicable Grantor or to whomsoever may be lawfully entitled to
receive such surplus.
16
(c) All payments received by any Grantor under or in
connection with any Assigned Agreement or otherwise in respect of the
Collateral shall be received in trust for the benefit of the
Collateral Agent, shall be segregated from other funds of such
Grantor and shall be forthwith paid over to the Collateral Agent in
the same form as so received (with any necessary indorsement).
(d) The Collateral Agent may, without notice to any Grantor
except as required by law and at any time or from time to time,
charge, set-off and otherwise apply all or any part of the Secured
Obligations against any funds held with respect to the Account
Collateral or in any other deposit account.
(e) The Collateral Agent may send to each bank, securities
intermediary or issuer party to any Deposit Account Control
Agreement, Securities Account Control Agreement or Uncertificated
Security Control Agreement a "Notice of Exclusive Control as defined
in and under such Agreement.
(f) If the Collateral Agent shall determine to exercise its
right to sell all or any of the Security Collateral of any Grantor
pursuant to this Section 20, each Grantor agrees that, upon request
of the Collateral Agent, such Grantor will, at its own expense:
(i) execute and deliver, and cause each issuer of
such Security Collateral contemplated to be sold and the
directors and officers thereof to execute and deliver, all
such instruments and documents, and do or cause to be done
all such other acts and things, as may be necessary or, in
the opinion of the Collateral Agent, advisable to register
such Security Collateral under the provisions of the
Securities Act of 1933 (as amended from time to time, the
"Securities Act"), to cause the registration statement
relating thereto to become effective and to remain effective
for such period as prospectuses are required by law to be
furnished and to make all amendments and supplements thereto
and to the related prospectus that, in the opinion of the
Collateral Agent, are necessary or advisable, all in
conformity with the requirements of the Securities Act and
the rules and regulations of the Securities and Exchange
Commission applicable thereto;
(ii) use its best efforts to qualify the Security
Collateral under the state securities or "Blue Sky" laws and
to obtain all necessary governmental approvals for the sale
of such Security Collateral, as requested by the Collateral
Agent;
(iii) cause each such issuer of such Security
Collateral to make available to its security holders, as
soon as practicable, an earnings statement that will satisfy
the provisions of Section 11(a) of the Securities Act;
(iv) provide the Collateral Agent with such other
information and projections as may be necessary or, in the
opinion of the Collateral Agent, advisable to enable the
Collateral Agent to effect the sale of such Security
Collateral; and
17
(v) do or cause to be done all such other acts and
things as may be necessary to make such sale of such
Security Collateral or any part thereof valid and binding
and in compliance with applicable law.
(g) The Collateral Agent is authorized, in connection with
any sale of the Security Collateral pursuant to this Section 20, to
deliver or otherwise disclose to any prospective purchaser of the
Security Collateral: (i) any registration statement or prospectus,
and all supplements and amendments thereto, prepared pursuant to
subsection (f)(i) above; (ii) any information and projections
provided to it pursuant to subsection (f)(iv) above; and (iii) any
other information in its possession relating to such Security
Collateral.
Section 21. Amendments; Waivers; Additional Grantors; Etc.
(a) No amendment or waiver of any provision of this Agreement, and no consent
to any departure by any Grantor herefrom, shall in any event be effective
unless the same shall be in writing and signed as required by Section 10.01 of
the Credit Agreement, and then such waiver or consent shall be effective only
in the specific instance and for the specific purpose for which given. No
failure on the part of the Collateral Agent or any other Secured Party to
exercise, and no delay in exercising any right hereunder, shall operate as a
waiver thereof; nor shall any single or partial exercise of any such right
preclude any other or further exercise thereof or the exercise of any other
right.
(b) Upon the execution and delivery by any Person of a
security agreement supplement in substantially the form of Exhibit A hereto
(each a "Security Agreement Supplement"), such Person shall be referred to as
an "Additional Grantor" and shall be and become a Grantor hereunder, and each
reference in this Agreement and the other Loan Documents to "Grantor" shall
also mean and be a reference to such Additional Grantor, and each reference in
this Agreement and the other Loan Documents to the "Collateral" shall also
mean and be a reference to the Collateral granted by such Additional Grantor
and each reference in this Agreement to a Schedule shall also mean and be a
reference to the schedules attached to such Security Agreement Supplement.
Section 22. Continuing Security Interest; Assignments under
the Credit Agreement. This Agreement shall create a continuing security
interest in the Collateral and shall (a) remain in full force and effect
unless and until (i) all of the Secured Obligations shall have been paid in
full in cash (other than L/C Obligations, Obligations in respect of Secured
Hedge Agreements, and Obligations in respect of Qualified Foreign Credit
Facilities), (ii) all Letters of Credit shall have expired or been terminated
or Cash Collateralized, (iii) all Secured Hedge Agreements and all Qualified
Foreign Credit Facilities shall have expired or been terminated or collateral
security provided in respect thereof in form and substance reasonably
satisfactory to the counterparty to such Secured Hedge Agreement or the
Qualified Foreign Lender under such Qualified Foreign Credit Facility, as
applicable, and (iv) the Commitments shall have expired or been terminated
(the first date on which all of the foregoing conditions have been met being
the "Termination Date"; provided, however, that in the case of the termination
or expiration of all Letters of Credit, Secured Hedge Agreements or Qualified
Foreign Credit Facilities as described in clauses (ii) and (iii) above (and
not in the case of a Cash Collateralization or collateral security being
provided as described in clauses (ii) and (iii) above), the Termination Date
shall not occur
18
until (x) all L/C Obligations, all Obligations in respect of Secured Hedge
Agreements, and all Obligations in respect of Qualified Foreign Credit
Facilities, as applicable, shall have been paid in full in cash and (y) all of
the other conditions in clauses (i) through (iv) have been met, (b) be binding
upon each Grantor, its successors and assigns and (c) inure, together with the
rights and remedies of the Collateral Agent hereunder, to the benefit of the
Secured Parties and their respective successors, transferees and assigns.
Without limiting the generality of the foregoing clause (c), any Lender may
assign or otherwise transfer all or any portion of its rights and obligations
under the Credit Agreement (including, without limitation, all or any portion
of its Commitments, the Loans owing to it and the Note or Notes, if any, held
by it) to any other Person, and such other Person shall thereupon become
vested with all the benefits in respect thereof granted to such Lender herein
or otherwise, in each case as provided in Section 10.06 of the Credit
Agreement.
Section 23. Release; Termination. (a) Upon any sale, lease,
transfer or other disposition of any item of Collateral of any Grantor in
accordance with the terms of the Loan Documents (other than sales of Inventory
in the ordinary course of business), the Collateral Agent will, at such
Grantor's expense, execute and deliver to such Grantor such documents as such
Grantor shall reasonably request to evidence the release of such item of
Collateral from the assignment and security interest granted hereby; provided,
however, that (i) such Grantor shall have delivered to the Collateral Agent,
at least five Business Days prior to the date of the proposed release, a
written request for release describing the item of Collateral and the terms of
the sale, lease, transfer or other disposition in reasonable detail,
including, without limitation, the price thereof and any expenses in
connection therewith, together with a form of release for execution by the
Collateral Agent and a certificate of such Grantor to the effect that the
transaction is in compliance with the Loan Documents and as to such other
matters as the Collateral Agent may reasonably request and (ii) the proceeds
of any such sale, lease, transfer or other disposition required to be applied,
or any payment to be made in connection therewith, in accordance with Section
2.06 of the Credit Agreement shall, to the extent so required, be paid or made
to, or in accordance with the instructions of, the Collateral Agent when and
as required under Section 2.06 of the Credit Agreement.
(b) On the Termination Date, the pledge and security
interest granted hereby shall terminate and all rights to the Collateral shall
revert to the applicable Grantor. Upon any such termination, the Collateral
Agent will, at the applicable Grantor's expense, execute and deliver to such
Grantor such documents as such Grantor shall reasonably request to evidence
such termination.
Section 24. Execution in Counterparts. This Agreement may be
executed in any number of counterparts, each of which when so executed shall
be deemed to be an original and all of which taken together shall constitute
one and the same agreement. Delivery of an executed counterpart of a signature
page to this Agreement by telecopier or by e-mail of a scanned copy shall be
effective as delivery of an original executed counterpart of this Agreement.
Section 25. Governing Law(a) This Agreement shall be
governed by, and construed in accordance with, the laws of the State of New
York.
19
(b) Each Grantor hereby irrevocably and unconditionally
submits, for itself and its property, to the nonexclusive jurisdiction of any
New York State court or federal court of the United States of America sitting
in New York City, and any appellate court from any thereof, in any action or
proceeding arising out of or relating to this Agreement or any of the other
Loan Documents to which it is or is to be a party, or for recognition or
enforcement of any judgment, and each Grantor hereby irrevocably and
unconditionally agrees that all claims in respect of any such action or
proceeding may be heard and determined in any such New York State court or, to
the extent permitted by Law, in such federal court. Each Grantor agrees that a
final judgment in any such action or proceeding shall be conclusive and may be
enforced in other jurisdictions by suit on the judgment or in any other manner
provided by Law. Nothing in this Agreement or any other Loan Document shall
affect any right that any party may otherwise have to bring any action or
proceeding relating to this Agreement or any other Loan Document in the courts
of any jurisdiction.
(c) Each Grantor irrevocably and unconditionally waives, to
the fullest extent it may legally and effectively do so, any objection that it
may now or hereafter have to the laying of venue of any suit, action or
proceeding arising out of or relating to this Agreement or any of the other
Loan Documents to which it is or is to be a party in any New York State or
federal court. Each Grantor hereby irrevocably waives, to the fullest extent
permitted by Law, the defense of an inconvenient forum to the maintenance of
such suit, action or proceeding in any such court.
(d) EACH GRANTOR HEREBY IRREVOCABLY WAIVES ALL RIGHT TO
TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM (WHETHER BASED ON
CONTRACT, TORT OR OTHERWISE) ARISING OUT OF OR RELATING TO ANY OF THE LOAN
DOCUMENTS, THE LOANS OR THE ACTIONS OF ANY SECURED PARTY IN THE NEGOTIATION,
ADMINISTRATION, PERFORMANCE OR ENFORCEMENT THEREOF.
20
IN WITNESS WHEREOF, each Grantor has caused this Agreement
to be duly executed and delivered by its officer thereunto duly authorized as
of the date first above written.
RAYOVAC CORPORATION
By /s/ James T. Lucke
----------------------------------------
Name: James T. Lucke
Title: Senior Vice President, Secretary
and General Counsel
Address for Notices: ROVCAL, INC.
601 Rayovac Drive
Madison, WI 53711
By /s/ James T. Lucke
----------------------------------------
Name: James T. Lucke
Title: Vice President and Secretary
Address for Notices: ROV HOLDING, INC.
601 Rayovac Drive
Madison, WI 53711
By /s/ James T. Lucke
----------------------------------------
Name: James T. Lucke
Title: Secretary and Treasurer
Address for Notices: UNITED INDUSTRIES CORPORATION
2150 Schuetz Road
St. Louis, MO 63146
By /s/ Lou Laderman
----------------------------------------
Name: Lou Laderman
Title: Vice President, Secretary
and General Counsel
Address for Notices: NU-GRO AMERICA CORP.
c/o United Industries Corporation
2150 Schuetz Road
St. Louis, MO 63146 By /s/ Lou Laderman
----------------------------------------
Name: Lou Laderman
Title: Vice President and Secretary
21
Address for Notices: NU-GRO US HOLDCO CORP.
c/o United Industries Corporation
2150 Schuetz Road
St. Louis, MO 63146 By /s/ Lou Laderman
----------------------------------------
Name: Lou Laderman
Title: Secretary
Address for Notices: SCHULTZ COMPANY
c/o United Industries Corporation
2150 Schuetz Road
St. Louis, MO 63146 By /s/ Lou Laderman
----------------------------------------
Name: Lou Laderman
Title: Vice President and Secretary
Address for Notices: SYLORR PLANT CORP.
c/o United Industries Corporation
2150 Schuetz Road
St. Louis, MO 63146 By /s/ Lou Laderman
----------------------------------------
Name: Lou Laderman
Title: Vice President and Secretary
Address for Notices: WPC BRANDS, INC.
c/o United Industries Corporation
2150 Schuetz Road
St. Louis, MO 63146 By /s/ Lou Laderman
----------------------------------------
Name: Lou Laderman
Title: Vice President and Secretary
Address for Notices: UNITED PET GROUP, INC.
463 Ohio Pike, Ste. 303
Cincinnati, OH 45255
By /s/ Lou Laderman
----------------------------------------
Name: Lou Laderman
Title: Vice President and Secretary
Address for Notices: IB NITROGEN INC.
c/o United Industries Corporation
2150 Schuetz Road
St. Louis, MO 63146 By /s/ Lou Laderman
----------------------------------------
Name: Lou Laderman
Title: Vice President and Secretary
22
Address for Notices: NU-GRO TECHNOLOGIES, INC.
c/o United Industries Corporation
2150 Schuetz Road
St. Louis, MO 63146 By /s/ Lou Laderman
----------------------------------------
Name: Lou Laderman
Title: Vice President and Secretary
Address for Notices: GROUND ZERO, INC.
c/o United Industries Corporation
2150 Schuetz Road
St. Louis, MO 63146 By /s/ Lou Laderman
----------------------------------------
Name: Lou Laderman
Title: Vice President and Secretary
Address for Notices: DB ONLINE, LLC
463 Ohio Pike, Ste. 303 By: United Pet Goup, Inc., its Managing
Cincinnati, OH 45255 Member
By /s/ Lou Laderman
----------------------------------------
Name: Lou Laderman
Title: Vice President and Secretary
Address for Notices: PETS `N PEOPLE, INC.
463 Ohio Pike, Ste. 303
Cincinnati, OH 45255
By /s/ Lou Laderman
----------------------------------------
Name: Lou Laderman
Title: Vice President and Secretary
Address for Notices: AQ HOLDINGS, INC.
463 Ohio Pike, Ste. 303
Cincinnati, OH 45255
By /s/ Lou Laderman
----------------------------------------
Name: Lou Laderman
Title: Vice President and Secretary
Address for Notices: SOUTHERN CALIFORNIA FOAM, INC.
463 Ohio Pike, Ste. 303
Cincinnati, OH 45255
By /s/ Lou Laderman
----------------------------------------
Name: Lou Laderman
Title: Vice President and Secretary
23
Address for Notices: AQUARIA, INC.
463 Ohio Pike, Ste. 303
Cincinnati, OH 45255
By /s/ Lou Laderman
----------------------------------------
Name: Lou Laderman
Title: Vice President and Secretary
Address for Notices: PERFECTO HOLDING CORP.
463 Ohio Pike, Ste. 303
Cincinnati, OH 45255
By /s/ Lou Laderman
----------------------------------------
Name: Lou Laderman
Title: Vice President and Secretary
Address for Notices: AQUARIUM SYSTEMS, INC.
463 Ohio Pike, Ste. 303
Cincinnati, OH 45255
By /s/ Lou Laderman
----------------------------------------
Name: Lou Laderman
Title: Vice President and Secretary
Address for Notices: PERFECTO MANUFACTURING, INC.
463 Ohio Pike, Ste. 303
Cincinnati, OH 45255
By /s/ Lou Laderman
----------------------------------------
Name: Lou Laderman
Title: Vice President and Secretary
Address for Notices: JUNGLETALK INTERNATIONAL, INC.
463 Ohio Pike, Ste. 303
Cincinnati, OH 45255
By /s/ Lou Laderman
----------------------------------------
Name: Lou Laderman
Title: Vice President and Secretary
24
Schedule I to the Security Agreement
INVESTMENT PROPERTY
[Omitted. A supplemental copy of this schedule will be
furnished to the SEC upon request.]
Schedule II to the Security Agreement
INTELLECTUAL PROPERTY
[Omitted. A supplemental copy of this schedule will be
furnished to the SEC upon request.]
Schedule III to the Security Agreement
COMMERCIAL TORT CLAIMS
[Omitted. A supplemental copy of this schedule will be
furnished to the SEC upon request.]
Schedule IV to the Security Agreement
LOCATION, CHIEF EXECUTIVE OFFICE, TYPE OF ORGANIZATION,
JURISDICTION OF ORGANIZATION AND ORGANIZATIONAL IDENTIFICATION
NUMBER
[Omitted. A supplemental copy of this schedule will be
furnished to the SEC upon request.]
Schedule V to the Security Agreement
CHANGES IN NAME, ETC.
[Omitted. A supplemental copy of this schedule will be
furnished to the SEC upon request.]
Schedule VI to the Security Agreement
LETTERS OF CREDIT
[Omitted. A supplemental copy of this schedule will be
furnished to the SEC upon request.]
Schedule VII to the Security Agreement
INTELLECTUAL PROPERTY MATTERS
[Omitted. A supplemental copy of this schedule will be
furnished to the SEC upon request.]
Exhibit A to the Security Agreement
FORM OF SECURITY AGREEMENT SUPPLEMENT
[Omitted. A supplemental copy of this exhibit will be
furnished to the SEC upon request.]
Exhibit B to the Security Agreement
FORM OF INTELLECTUAL PROPERTY SECURITY AGREEMENT
[Omitted. A supplemental copy of this exhibit will be
furnished to the SEC upon request.]
Exhibit C to the Security Agreement
FORM OF CONSENT TO ASSIGNMENT OF LETTER OF CREDIT RIGHTS
[Omitted. A supplemental copy of this exhibit will be
furnished to the SEC upon request.]
EXHIBIT 10.3
ROV GUARANTY
Dated as of February 7, 2005
From
THE ROV GUARANTORS NAMED HEREIN
and
THE ADDITIONAL ROV GUARANTORS REFERRED TO HEREIN
as ROV Guarantors
in favor of
THE SECURED PARTIES REFERRED TO IN
THE CREDIT AGREEMENT REFERRED TO HEREIN
T A B L E O F C O N T E N T S
Section Page
- ------- ----
Section 1. Guaranty; Limitation of Liability..............................................................1
Section 2. Guaranty Absolute..............................................................................2
Section 3. Waivers and Acknowledgments....................................................................3
Section 4. Subrogation....................................................................................4
Section 5. Payments Free and Clear of Taxes, Etc..........................................................5
Section 6. Representations and Warranties.................................................................5
Section 7. Covenants......................................................................................6
Section 8. Amendments, ROV Guaranty Supplements, Etc......................................................6
Section 9. No Waiver; Remedies............................................................................6
Section 10. Subordination.................................................................................6
Section 11. Continuing Guaranty; Assignments under the Credit Agreement...................................8
Section 12. Execution in Counterparts.....................................................................8
Section 13. Governing Law; Jurisdiction; Waiver of Jury Trial, Etc........................................8
Exhibit A - ROV Guaranty Supplement
ROV GUARANTY
ROV GUARANTY dated as of February 7, 2005 made by the
Persons listed on the signature pages hereof under the caption "ROV
Guarantors" and the Additional ROV Guarantors (as defined in Section 8(b))
(such Persons so listed and the Additional ROV Guarantors being, collectively,
the "ROV Guarantors" and, individually, each an "ROV Guarantor") in favor of
the Secured Parties (as defined in the Credit Agreement referred to below).
PRELIMINARY STATEMENT. Rayovac Corporation, a Wisconsin
corporation (the "U.S. Borrower"), Varta Consumer Batteries GmbH & Co. KGaA, a
German partnership limited by shares (the "Euro Borrower") and Rayovac Europe
Limited, a limited liability company (the "UK Borrower" and, together with the
U.S. Borrower and the Euro Borrower, each a "Borrower" and collectively the
"Borrowers") are party to a Fourth Amended and Restated Credit Agreement dated
as of February 7, 2005 (as amended, amended and restated, supplemented or
otherwise modified from time to time, the "Credit Agreement"; the capitalized
terms defined therein and not otherwise defined herein being used herein as
therein defined) with certain Lenders party thereto, and Bank of America,
N.A., as Administrative Agent for such Lenders. Each ROV Guarantor will derive
substantial direct and indirect benefits from the transactions contemplated by
the Credit Agreement. It is a condition precedent to the making of Loans by
the Lenders and the issuance of Letters of Credit by the L/C Issuer under the
Credit Agreement, the entry by the Hedge Banks into Secured Hedge Agreements
and the entry by the Qualified Foreign Lenders into Qualified Foreign Credit
Facilities from time to time that each ROV Guarantor shall have executed and
delivered this ROV Guaranty.
NOW, THEREFORE, in consideration of the premises and in
order to induce the Lenders to make Loans and the L/C Issuer to issue Letters
of Credit under the Credit Agreement, the Hedge Banks to enter into Secured
Hedge Agreements and the Qualified Foreign Lenders to enter into Qualified
Foreign Credit Facilities from time to time, each ROV Guarantor, jointly and
severally with each other ROV Guarantor, hereby agrees as follows:
Section 1. Guaranty; Limitation of Liability. (a) Each ROV
Guarantor hereby absolutely, unconditionally and irrevocably guarantees the
punctual payment when due, whether at scheduled maturity or on any date of a
required prepayment or by acceleration, demand or otherwise, of all
Obligations of the U.S. Borrower and each other ROV Guarantor now or hereafter
existing under or in respect of the Loan Documents (including, without
limitation, any extensions, modifications, substitutions, amendments or
renewals of any or all of the foregoing Obligations) (such Obligations being
the "ROV Guaranteed Obligations"). Without limiting the generality of the
foregoing, each ROV Guarantor's liability shall extend to all amounts that
constitute part of the ROV Guaranteed Obligations and would be owed by the
U.S. Borrower or any ROV Guarantor to any Secured Party under or in respect of
the Loan Documents but for the fact that they are unenforceable or not
allowable due to the existence of a bankruptcy, reorganization or similar
proceeding involving such other Loan Party.
(b) Each ROV Guarantor, and by its acceptance of this ROV
Guaranty, the Administrative Agent and each other Secured Party, hereby
confirms that it is the intention of all such Persons that this ROV Guaranty
and the Obligations of each ROV Guarantor hereunder not
1
constitute a fraudulent transfer or conveyance for purposes of any Bankruptcy
Law (as hereinafter defined), the Uniform Fraudulent Conveyance Act, the
Uniform Fraudulent Transfer Act or any similar foreign, federal or state Law
to the extent applicable to this ROV Guaranty and the Obligations of each ROV
Guarantor hereunder. To effectuate the foregoing intention, the Administrative
Agent, the other Secured Parties and the ROV Guarantors hereby irrevocably
agree that the Obligations of each ROV Guarantor under this ROV Guaranty at
any time shall be limited to the maximum amount as will result in the
Obligations of such ROV Guarantor under this ROV Guaranty not constituting a
fraudulent transfer or conveyance. For purposes hereof, "Bankruptcy Law" means
any proceeding of the type referred to in Section 8.01(f) of the Credit
Agreement or Title 11, U.S. Code, or any similar foreign, federal or state Law
for the relief of debtors.
(c) Each ROV Guarantor hereby unconditionally and
irrevocably agrees that in the event any payment shall be required to be made
to any Secured Party under this ROV Guaranty, such ROV Guarantor will
contribute, to the maximum extent permitted by Law, such amounts to each other
ROV Guarantor so as to maximize the aggregate amount of such payment to the
Secured Parties under or in respect of the Loan Documents.
Section 2. Guaranty Absolute. Each ROV Guarantor guarantees
that the ROV Guaranteed Obligations will be paid in accordance with the terms
of the Loan Documents, regardless of any Law, regulation or order now or
hereafter in effect in any jurisdiction affecting any of such terms or the
rights of any Secured Party with respect thereto to the fullest extent
permitted by applicable Law. The Obligations of each ROV Guarantor under or in
respect of this ROV Guaranty are independent of the ROV Guaranteed Obligations
or any other Obligations of any other Loan Party under or in respect of the
Loan Documents, and a separate action or actions may be brought and prosecuted
against each ROV Guarantor to enforce this ROV Guaranty, irrespective of
whether any action is brought against the U.S. Borrower or any other Loan
Party or whether the U.S. Borrower or any other Loan Party is joined in any
such action or actions. The liability of each ROV Guarantor under this ROV
Guaranty shall be irrevocable, absolute and unconditional irrespective of, and
each ROV Guarantor hereby irrevocably waives to the fullest extent permitted
by applicable Law any defenses it may now have or hereafter acquire in any way
relating to, any or all of the following:
(a) any lack of validity or enforceability of any Loan
Document or any agreement or instrument relating thereto;
(b) any change in the time, manner or place of payment
of, or in any other term of, all or any of the ROV Guaranteed
Obligations or any other Obligations of any other Loan Party under
or in respect of the Loan Documents, or any other amendment or
waiver of or any consent to departure from any Loan Document,
including, without limitation, any increase in the ROV Guaranteed
Obligations resulting from the extension of additional credit to any
Loan Party or any of its Subsidiaries or otherwise;
(c) any taking, exchange, release or non-perfection of
any Collateral or any other collateral, or any taking, release or
amendment or waiver of, or consent to departure from, any other
guaranty, for all or any of the ROV Guaranteed Obligations or any
other Obligations of any other Loan Party under or in respect of the
Loan Documents;
2
(d) any manner of application of Collateral or any
other collateral, or proceeds thereof, to all or any of the ROV
Guaranteed Obligations or any other Obligations of any other Loan
Party under or in respect of the Loan Documents, or any manner of
sale or other disposition of any Collateral or any other collateral
for all or any of the ROV Guaranteed Obligations or any other
Obligations of any Loan Party under the Loan Documents or any other
assets of any Loan Party or any of its Subsidiaries;
(e) any change, restructuring or termination of the
corporate structure or existence of any Loan Party or any of its
Subsidiaries;
(f) any failure of any Secured Party to disclose to any
Loan Party any information relating to the business, condition
(financial or otherwise), operations, performance, properties or
prospects of any other Loan Party now or hereafter known to such
Secured Party (each ROV Guarantor waiving any duty on the part of
the Secured Parties to disclose such information);
(g) the failure of any other Person to execute or
deliver this ROV Guaranty, any ROV Guaranty Supplement (as
hereinafter defined) or any other guaranty or agreement or the
release or reduction of liability of any ROV Guarantor or other
guarantor or surety with respect to the ROV Guaranteed Obligations
(other than in connection with the termination of this ROV Guaranty
in accordance with the provisions of Section 11); or
(h) any other circumstance (including, without
limitation, any statute of limitations) or any existence of or
reliance on any representation by any Secured Party that might
otherwise constitute a defense available to, or a discharge of, any
Loan Party or any other guarantor or surety.
This ROV Guaranty shall continue to be effective or be reinstated, as the case
may be, if at any time any payment of any of the ROV Guaranteed Obligations is
rescinded or must otherwise be returned by any Secured Party or any other
Person (but only to the extent that such Person has a claim against a Secured
Party, or a Secured Party is liable to such Person, as a result of such
rescission or return) upon the insolvency, bankruptcy or reorganization of the
U.S. Borrower or any other Loan Party or otherwise, all as though such payment
had not been made.
Section 3. Waivers and Acknowledgments. (a) Each ROV
Guarantor hereby unconditionally and irrevocably waives promptness, diligence,
notice of acceptance, presentment, demand for performance, notice of
nonperformance, default, acceleration, protest or dishonor and any other
notice with respect to any of the ROV Guaranteed Obligations and this ROV
Guaranty and any requirement that any Secured Party protect, secure, perfect
or insure any Lien or any property subject thereto or exhaust any right or
take any action against any Loan Party or any other Person or any Collateral.
(b) Each ROV Guarantor hereby unconditionally and
irrevocably waives any right to revoke this ROV Guaranty and acknowledges that
this ROV Guaranty is continuing in nature and applies to all ROV Guaranteed
Obligations, whether existing now or in the future.
3
(c) Each ROV Guarantor hereby unconditionally and
irrevocably waives (i) any defense arising by reason of any claim or defense
based upon an election of remedies by any Secured Party that in any manner
impairs, reduces, releases or otherwise adversely affects the subrogation,
reimbursement, exoneration, contribution or indemnification rights of such ROV
Guarantor or other rights of such ROV Guarantor to proceed against any of the
other Loan Parties, any other guarantor or any other Person or any Collateral
and (ii) any defense based on any right of set-off or counterclaim against or
in respect of the Obligations of such ROV Guarantor hereunder.
(d) Each ROV Guarantor acknowledges that the Administrative
Agent may, without notice to or demand upon such ROV Guarantor and without
affecting the liability of such ROV Guarantor under this ROV Guaranty,
foreclose under any mortgage by nonjudicial sale, and each ROV Guarantor
hereby waives any defense to the recovery by the Administrative Agent and the
other Secured Parties against such ROV Guarantor of any deficiency after such
nonjudicial sale and any defense or benefits that may be afforded by
applicable Law.
(e) Each ROV Guarantor hereby unconditionally and
irrevocably waives any duty on the part of any Secured Party to disclose to
such ROV Guarantor any matter, fact or thing relating to the business,
condition (financial or otherwise), operations, performance, properties or
prospects of any other Loan Party or any of its Subsidiaries now or hereafter
known by such Secured Party.
(f) Each ROV Guarantor acknowledges that it will receive
substantial direct and indirect benefits from the financing arrangements
contemplated by the Loan Documents and that the waivers set forth in Section 2
and this Section 3 are knowingly made in contemplation of such benefits.
Section 4. Subrogation. Each ROV Guarantor hereby
unconditionally and irrevocably agrees not to exercise any rights that it may
now have or hereafter acquire against the U.S. Borrower or any other Loan
Party that arise from the existence, payment, performance or enforcement of
such ROV Guarantor's Obligations under or in respect of this ROV Guaranty or
any other Loan Document, including, without limitation, any right of
subrogation, reimbursement, exoneration, contribution or indemnification and
any right to participate in any claim or remedy of any Secured Party against
the U.S. Borrower or any other Loan Party or any Collateral, 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 U.S. Borrower or any other Loan Party, 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, remedy or right, unless and until (a) all of the ROV
Guaranteed Obligations shall have been paid in full in cash (other than L/C
Obligations, Obligations in respect of Secured Hedge Agreements, and
Obligations in respect of Qualified Foreign Credit Facilities), (b) all
Letters of Credit shall have expired or been terminated or Cash
Collateralized, (c) all Secured Hedge Agreements and all Qualified Foreign
Credit Facilities shall have expired or been terminated or collateral security
provided in respect thereof in form and substance reasonably satisfactory to
the counterparty to such Secured Hedge Agreement or the Qualified Foreign
Lender under such Qualified Foreign Credit Facility, as applicable, and (d)
the Commitments shall have expired or been terminated (the first date on which
all of the foregoing conditions have been met being the "Termination Date";
provided,
4
however, that in the case of the termination or expiration of all Letters of
Credit, Secured Hedge Agreements or Qualified Foreign Credit Facilities as
described in clauses (b) and (c) above (and not in the case of a Cash
Collateralization or collateral security being provided as described in
clauses (b) and (c) above), the Termination Date shall not occur until (i) all
L/C Obligations, all Obligations in respect of Secured Hedge Agreements, and
all Obligations in respect of Qualified Foreign Credit Facilities (in each
case, to the extent such Obligations constitute ROV Guaranteed Obligations),
as applicable, shall have been paid in full in cash and (ii) all of the other
conditions in clauses (a) through (d) have been met. If any amount shall be
paid to any ROV Guarantor in violation of the immediately preceding sentence
at any time prior to the Termination Date, such amount shall be received and
held in trust for the benefit of the Secured Parties, shall be segregated from
other property and funds of such ROV Guarantor and shall forthwith be paid or
delivered to the Administrative Agent in the same form as so received (with
any necessary endorsement or assignment) to be credited and applied to the ROV
Guaranteed Obligations, whether matured or unmatured, in accordance with the
terms of the Loan Documents, or to be held as Collateral for any ROV
Guaranteed Obligations thereafter arising. If any ROV Guarantor shall make
payment to any Secured Party of all or any part of the ROV Guaranteed
Obligations and the Termination Date shall have occurred, the Secured Parties
will, at such ROV Guarantor's request and expense, execute and deliver to such
ROV Guarantor appropriate documents, without recourse and without
representation or warranty, necessary to evidence the transfer by subrogation
to such ROV Guarantor of an interest in the ROV Guaranteed Obligations
resulting from such payment made by such ROV Guarantor pursuant to this ROV
Guaranty.
Section 5. Payments Free and Clear of Taxes, Etc. Any and
all payments by or on account of any Obligation of any ROV Guarantor hereunder
shall be made free and clear of and without reduction or withholding for any
Indemnified Taxes or Other Taxes on the same terms and to the same extent that
payments by the Borrowers are required to be made free and clear of
Indemnified Taxes and Other Taxes pursuant to the terms of Section 3.01 of the
Credit Agreement.
Section 6. Representations and Warranties. Each ROV
Guarantor hereby makes each representation and warranty made in the Loan
Documents by the Borrowers with respect to such ROV Guarantor and each ROV
Guarantor hereby further represents and warrants as follows:
(a) There are no conditions precedent to the
effectiveness of this ROV Guaranty that have not been satisfied or
waived.
(b) Such ROV Guarantor has, independently and without
reliance upon any Secured Party and based on such documents and
information as it has deemed appropriate, made its own credit
analysis and decision to enter into this ROV Guaranty and each other
Loan Document to which it is or is to be a party, and such ROV
Guarantor has established adequate means of obtaining from each
other Loan Party on a continuing basis information pertaining to,
and is now and on a continuing basis will be completely familiar
with, the business, condition (financial or otherwise), operations,
performance, properties and prospects of such other Loan Party.
5
Section 7. Covenants. Each ROV Guarantor covenants and
agrees that, so long as the Termination Date shall not have occurred, such ROV
Guarantor will perform and observe, and cause each of its Subsidiaries to
perform and observe, all of the terms, covenants and agreements set forth in
the Loan Documents on its or their part to be performed or observed or that
the Borrowers have agreed to cause such ROV Guarantor or such Subsidiaries to
perform or observe.
Section 8. Amendments, ROV Guaranty Supplements, Etc. (a) No
amendment or waiver of any provision of this ROV Guaranty and no consent to
any departure by any ROV Guarantor therefrom shall in any event be effective
unless the same shall be in writing and signed as required by Section 10.01 of
the Credit Agreement and signed by the ROV Guarantors, and then such waiver or
consent shall be effective only in the specific instance and for the specific
purpose for which given. Upon the sale or dissolution of an ROV Guarantor or
in the event that any ROV Guarantor is designated a Dormant Subsidiary, in
each case, to the extent permitted in accordance with the terms of the Loan
Documents, such ROV Guarantor shall be automatically released from the ROV
Guaranty.
(b) Upon the execution and delivery by any Person of a
guaranty supplement in substantially the form of Exhibit A hereto (each, an
"ROV Guaranty Supplement"), (i) such Person shall be referred to as an
"Additional ROV Guarantor" and shall become and be an ROV Guarantor hereunder,
and each reference in this ROV Guaranty to an "ROV Guarantor" shall also mean
and be a reference to such Additional ROV Guarantor, and each reference in any
other Loan Document to an "ROV Guarantor" or a "Guarantor" shall also mean and
be a reference to such Additional ROV Guarantor, and (ii) each reference
herein to "this ROV Guaranty", "hereunder", "hereof" or words of like import
referring to this ROV Guaranty, and each reference in any other Loan Document
to the "ROV Guaranty", "thereunder", "thereof" or words of like import
referring to this ROV Guaranty, shall mean and be a reference to this ROV
Guaranty as supplemented by such ROV Guaranty Supplement.
Section 9. No Waiver; Remedies. No failure on the part of
any Secured Party to exercise, and no delay in exercising, any right or
remedy, hereunder shall operate as a waiver thereof; nor shall any single or
partial exercise of any right or remedy hereunder preclude any other or
further exercise thereof or the exercise of any other right or remedy. The
rights and remedies herein provided are cumulative and not exclusive of any
rights or remedies provided by Law.
Section 10. Subordination. Each ROV Guarantor hereby
subordinates any and all debts, liabilities and other obligations owed to such
ROV Guarantor by each other Loan Party (the "Subordinated Obligations") to the
ROV Guaranteed Obligations to the extent and in the manner hereinafter set
forth in this Section 10:
(a) Prohibited Payments, Etc. Except during the
continuance of an Event of Default (including the commencement and
continuation of any proceeding under any Bankruptcy Law relating to
any other Loan Party), each ROV Guarantor may receive regularly
scheduled payments from any other Loan Party on account of the
Subordinated Obligations. After the occurrence and during the
continuance of any Event of Default (including the commencement and
continuation of any proceeding under any Bankruptcy
6
Law relating to any other Loan Party) that has not been waived in
accordance with Section 10.01 of the Credit Agreement, no ROV
Guarantor shall demand, accept or take any action to collect any
payment on account of the Subordinated Obligations.
(b) Prior Payment of ROV Guaranteed Obligations. In any
proceeding under any Bankruptcy Law relating to any other Loan
Party, each ROV Guarantor consents to the Secured Parties receiving
payment in full in cash of all ROV Guaranteed Obligations (including
all interest and expenses accruing after the commencement of a
proceeding under any Bankruptcy Law, whether or not constituting an
allowed claim in such proceeding ("Post Petition Interest")) before
such ROV Guarantor receives payment of any Subordinated Obligations.
(c) Turn-Over. After the occurrence and during the
continuance of an Event of Default (including the commencement and
continuation of any proceeding under any Bankruptcy Law relating to
any other Loan Party), each ROV Guarantor shall, if the
Administrative Agent so requests, collect, enforce and receive
payments on account of the Subordinated Obligations as trustee for
the Secured Parties and deliver such payments to the Administrative
Agent on account of the ROV Guaranteed Obligations (including all
Post Petition Interest), together with any necessary endorsements or
other instruments of transfer, but without reducing or affecting in
any manner the liability of such ROV Guarantor under the other
provisions of this ROV Guaranty.
(d) Administrative Agent Authorization. After the occurrence
and during the continuance of an Event of Default (including the
commencement and continuation of any proceeding under any Bankruptcy
Law relating to any other Loan Party), the Administrative Agent is
authorized and empowered (but without any obligation to so do), in
its discretion, (i) in the name of each ROV Guarantor, to collect
and enforce, and to submit claims in respect of, Subordinated
Obligations and to apply any amounts received thereon to the ROV
Guaranteed Obligations (including any and all Post Petition
Interest), and (ii) to require each ROV Guarantor (A) to collect and
enforce, and to submit claims in respect of, Subordinated
Obligations and (B) to pay any amounts received on such obligations
to the Administrative Agent for application to the ROV Guaranteed
Obligations (including any and all Post Petition Interest).
7
Section 11. Continuing Guaranty; Assignments under the
Credit Agreement. This ROV Guaranty is a continuing guaranty and shall (a)
remain in full force and effect until the Termination Date, (b) be binding
upon each ROV Guarantor, its successors and assigns and (c) inure to the
benefit of and be enforceable by the Secured Parties and their successors,
transferees and assigns. Without limiting the generality of clause (c) of the
immediately preceding sentence, any Secured Party may assign or otherwise
transfer all or any portion of its rights and obligations under the Credit
Agreement (including, without limitation, all or any portion of its
Commitments, the Loans owing to it and any Note or Notes held by it) to any
other Person, and such other Person shall thereupon become vested with all the
benefits in respect thereof granted to such Secured Party herein or otherwise,
in each case as and to the extent provided in Section 10.06 of the Credit
Agreement. No ROV Guarantor shall have the right to assign its rights
hereunder or any interest herein without the prior written consent of the
Secured Parties.
Section 12. Execution in Counterparts. This ROV Guaranty and
each amendment, waiver and consent with respect hereto may be executed in any
number of counterparts and by different parties thereto in separate
counterparts, each of which when so executed shall be deemed to be an original
and all of which taken together shall constitute one and the same agreement.
Delivery of an executed counterpart of a signature page to this ROV Guaranty
by telecopy or by an electronically mailed scanned copy shall be effective as
delivery of an original executed counterpart of this ROV Guaranty.
Section 13. Governing Law; Jurisdiction; Waiver of Jury
Trial, Etc. (a) This ROV Guaranty shall be governed by, and construed in
accordance with, the Laws of the State of New York.
(b) Each ROV Guarantor hereby irrevocably and
unconditionally submits, for itself and its property, to the nonexclusive
jurisdiction of any New York State court or federal court of the United States
of America sitting in New York City, and any appellate court from any thereof,
in any action or proceeding arising out of or relating to this ROV Guaranty or
any of the other Loan Documents to which it is or is to be a party, or for
recognition or enforcement of any judgment, and each ROV Guarantor hereby
irrevocably and unconditionally agrees that all claims in respect of any such
action or proceeding may be heard and determined in any such New York State
court or, to the extent permitted by Law, in such federal court. Each ROV
Guarantor agrees that a final judgment in any such action or proceeding shall
be conclusive and may be enforced in other jurisdictions by suit on the
judgment or in any other manner provided by Law. Nothing in this ROV Guaranty
or any other Loan Document shall affect any right that any party may otherwise
have to bring any action or proceeding relating to this ROV Guaranty or any
other Loan Document in the courts of any jurisdiction.
(c) Each ROV Guarantor irrevocably and unconditionally
waives, to the fullest extent it may legally and effectively do so, any
objection that it may now or hereafter have to the laying of venue of any
suit, action or proceeding arising out of or relating to this ROV Guaranty or
any of the other Loan Documents to which it is or is to be a party in any New
York State or federal court. Each ROV Guarantor hereby irrevocably waives, to
the fullest extent permitted by Law, the defense of an inconvenient forum to
the maintenance of such suit, action or proceeding in any such court.
8
(d) EACH ROV GUARANTOR HEREBY IRREVOCABLY WAIVES ALL RIGHT
TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM (WHETHER BASED ON
CONTRACT, TORT OR OTHERWISE) ARISING OUT OF OR RELATING TO ANY OF THE LOAN
DOCUMENTS, THE LOANS OR THE ACTIONS OF ANY SECURED PARTY IN THE NEGOTIATION,
ADMINISTRATION, PERFORMANCE OR ENFORCEMENT THEREOF.
9
IN WITNESS WHEREOF, each ROV Guarantor has caused this ROV
Guaranty to be duly executed and delivered by its officer thereunto duly
authorized as of the date first above written.
ROV HOLDING, INC.
By /s/ James T. Lucke
-------------------------------------
Name: James T. Lucke
Title: Secretary and Treasurer
ROVCAL, INC.
By /s/ James T. Lucke
-------------------------------------
Name: James T. Lucke
Title: Vice President and Secretary
UNITED INDUSTRIES CORPORATION
By /s/ Lou Laderman
-------------------------------------
Name: Lou Laderman
Title: Vice President, Secretary and
General Counsel
NU-GRO AMERICA CORP.
By /s/ Lou Laderman
-------------------------------------
Name: Lou Laderman
Title: Vice President and Secretary
NU-GRO US HOLDCO CORP.
By /s/ Lou Laderman
-------------------------------------
Name: Lou Laderman
Title: Secretary
10
NU-GRO TECHNOLOGIES, INC.
By /s/ Lou Laderman
-------------------------------------
Name: Lou Laderman
Title: Vice President and Secretary
IB NITROGEN INC.
By /s/ Lou Laderman
-------------------------------------
Name: Lou Laderman
Title: Vice President and Secretary
SCHULTZ COMPANY
By /s/ Lou Laderman
-------------------------------------
Name: Lou Laderman
Title: Vice President and Secretary
GROUND ZERO, INC.
By /s/ Lou Laderman
-------------------------------------
Name: Lou Laderman
Title: Vice President and Secretary
SYLORR PLANT CORP.
By /s/ Lou Laderman
-------------------------------------
Name: Lou Laderman
Title: Vice President and Secretary
WPC BRANDS, INC.
By /s/ Lou Laderman
-------------------------------------
Name: Lou Laderman
Title: Vice President and Secretary
11
UNITED PET GROUP, INC.
By /s/ Lou Laderman
-------------------------------------
Name: Lou Laderman
Title: Vice President and Secretary
AQ HOLDINGS, INC.
By /s/ Lou Laderman
-------------------------------------
Name: Lou Laderman
Title: Vice President and Secretary
PERFECTO HOLDING CORP.
By /s/ Lou Laderman
-------------------------------------
Name: Lou Laderman
Title: Vice President and Secretary
AQUARIUM SYSTEMS, INC.
By /s/ Lou Laderman
-------------------------------------
Name: Lou Laderman
Title: Vice President and Secretary
PERFECTO MANUFACTURING, INC.
By /s/ Lou Laderman
-------------------------------------
Name: Lou Laderman
Title: Vice President and Secretary
JUNGLETALK INTERNATIONAL, INC.
By /s/ Lou Laderman
-------------------------------------
Name: Lou Laderman
Title: Vice President and Secretary
12
PETS 'N PEOPLE, INC.
By /s/ Lou Laderman
-------------------------------------
Name: Lou Laderman
Title: Vice President and Secretary
SOUTHERN CALIFORNIA FOAM, INC.
By /s/ Lou Laderman
-------------------------------------
Name: Lou Laderman
Title: Vice President and Secretary
AQUARIA, INC.
By /s/ Lou Laderman
-------------------------------------
Name: Lou Laderman
Title: Vice President and Secretary
DB ONLINE, LLC
By: United Pet Goup, Inc., its Managing
Member
By /s/ Lou Laderman
-------------------------------------
Name: Lou Laderman
Title: Vice President and Secretary
13
EXHIBIT A
ROV GUARANTY SUPPLEMENT
[Omitted. A supplemental copy of this exhibit will be
furnished to the SEC upon request.]
EXHIBIT 10.4
KGaA GUARANTY
Dated as of February 7, 2005
From
THE KGaA GUARANTORS NAMED HEREIN
and
THE ADDITIONAL KGaA GUARANTORS REFERRED TO HEREIN
as KGaA Guarantors
in favor of
THE LENDERS REFERRED TO IN
THE CREDIT AGREEMENT REFERRED TO HEREIN
T A B L E O F C O N T E N T S
Section Page
- ------- ----
Section 1. Guaranty; Limitation of Liability..............................................................1
Section 2. Guaranty Absolute..............................................................................2
Section 3. Waivers and Acknowledgments....................................................................3
Section 4. Subrogation....................................................................................4
Section 5. Payments Free and Clear of Taxes, Etc..........................................................5
Section 6. Representations and Warranties.................................................................5
Section 7. Covenants......................................................................................5
Section 8. Amendments, KGaA Guaranty Supplements, Etc.....................................................5
Section 9. No Waiver; Remedies............................................................................6
Section 10. Subordination.................................................................................6
Section 11. Continuing Guaranty; Assignments under the Credit Agreement...................................7
Section 12. Execution in Counterparts.....................................................................7
Section 13. Governing Law; Jurisdiction; Waiver of Jury Trial, Etc........................................7
Exhibit A - KGaA Guaranty Supplement
KGaA GUARANTY
KGaA GUARANTY dated as of February 7, 2005 made by the
Persons listed on the signature pages hereof under the caption "KGaA
Guarantors" and the Additional KGaA Guarantors (as defined in Section 8(b))
(such Persons so listed and the Additional KGaA Guarantors being,
collectively, the "KGaA Guarantors" and, individually, each a "KGaA
Guarantor") in favor of the Lenders (as defined in the Credit Agreement
referred to below).
PRELIMINARY STATEMENT. Rayovac Corporation, a Wisconsin
corporation (the "U.S. Borrower"), Varta Consumer BatteriesGmbH & Co. KGaA, a
German partnership limited by shares (the "Euro Borrower") and Rayovac Europe
Limited, a limited liability company (the "UK Borrower" and, together with the
U.S. Borrower and the Euro Borrower, each a "Borrower" and collectively the
"Borrowers") are party to a Fourth Amended and Restated Credit Agreement dated
as of February 7, 2005 (as amended, amended and restated, supplemented or
otherwise modified from time to time, the "Credit Agreement"; the capitalized
terms defined therein and not otherwise defined herein being used herein as
therein defined) with certain Lenders party thereto, and Bank of America,
N.A., as Administrative Agent for such Lenders. Each KGaA Guarantor will
derive substantial direct and indirect benefits from the transactions
contemplated by the Credit Agreement. It is a condition precedent to the
making of Loans by the Lenders and the issuance of Letters of Credit by the
L/C Issuer under the Credit Agreement from time to time that each KGaA
Guarantor shall have executed and delivered this KGaA Guaranty.
NOW, THEREFORE, in consideration of the premises and in
order to induce the Lenders to make Loans and the L/C Issuer to issue Letters
of Credit under the Credit Agreement from time to time, each KGaA Guarantor,
jointly and severally with each other KGaA Guarantor, hereby agrees as
follows:
Section 1. Guaranty; Limitation of Liability. (a) Each KGaA
Guarantor hereby absolutely, unconditionally and irrevocably guarantees the
punctual payment when due, whether at scheduled maturity or on any date of a
required prepayment or by acceleration, demand or otherwise, of all
Obligations of the Euro Borrower now or hereafter existing under or in respect
of the Loan Documents (including, without limitation, any extensions,
modifications, substitutions, amendments or renewals of any or all of the
foregoing Obligations) (such Obligations being the "KGaA Guaranteed
Obligations"); provided, however, that for purposes of this KGaA Guaranty, the
term "Loan Documents" shall not include (i) any agreement evidencing or
Guaranteeing a Qualified Foreign Credit Facility or (ii) any Secured Hedge
Agreement. Without limiting the generality of the foregoing, each KGaA
Guarantor's liability shall extend to all amounts that constitute part of the
KGaA Guaranteed Obligations and would be owed by the Euro Borrower to any
Lender under or in respect of the Loan Documents but for the fact that they
are unenforceable or not allowable due to the existence of a bankruptcy,
reorganization or similar proceeding involving such other Loan Party.
(b) Each KGaA Guarantor, and by its acceptance of this KGaA
Guaranty, the Administrative Agent and each other Lender, hereby confirms that
it is the intention of all such Persons that this KGaA Guaranty and the
Obligations of each KGaA Guarantor hereunder not constitute a fraudulent
transfer or conveyance for purposes of any Bankruptcy Law (as
1
hereinafter defined), the Uniform Fraudulent Conveyance Act, the Uniform
Fraudulent Transfer Act or any similar foreign, federal or state Law to the
extent applicable to this KGaA Guaranty and the Obligations of each KGaA
Guarantor hereunder. To effectuate the foregoing intention, the Administrative
Agent, the other Lenders and the KGaA Guarantors hereby irrevocably agree that
the Obligations of each KGaA Guarantor under this KGaA Guaranty at any time
shall be limited to the maximum amount as will result in the Obligations of
such KGaA Guarantor under this KGaA Guaranty not constituting a fraudulent
transfer or conveyance. For purposes hereof, "Bankruptcy Law" means any
proceeding of the type referred to in Section 8.01(f) of the Credit Agreement
or Title 11, U.S. Code, or any similar foreign, federal or state Law for the
relief of debtors.
Section 2. Guaranty Absolute. Each KGaA Guarantor guarantees
that the KGaA Guaranteed Obligations will be paid in accordance with the terms
of the Loan Documents, regardless of any Law, regulation or order now or
hereafter in effect in any jurisdiction affecting any of such terms or the
rights of any Lender with respect thereto to the fullest extent permitted by
applicable Law. The Obligations of each KGaA Guarantor under or in respect of
this KGaA Guaranty are independent of the KGaA Guaranteed Obligations or any
other Obligations of any other Loan Party under or in respect of the Loan
Documents, and a separate action or actions may be brought and prosecuted
against each KGaA Guarantor to enforce this KGaA Guaranty, irrespective of
whether any action is brought against the Euro Borrower or any other Loan
Party or whether the Euro Borrower or any other Loan Party is joined in any
such action or actions. The liability of each KGaA Guarantor under this KGaA
Guaranty shall be irrevocable, absolute and unconditional irrespective of, and
each KGaA Guarantor hereby irrevocably waives to the fullest extent permitted
by applicable Law any defenses it may now have or hereafter acquire in any way
relating to, any or all of the following:
(a) any lack of validity or enforceability of any Loan
Document or any agreement or instrument relating thereto;
(b) any change in the time, manner or place of payment
of, or in any other term of, all or any of the KGaA Guaranteed
Obligations or any other Obligations of any other Loan Party under
or in respect of the Loan Documents, or any other amendment or
waiver of or any consent to departure from any Loan Document,
including, without limitation, any increase in the KGaA Guaranteed
Obligations resulting from the extension of additional credit to any
Loan Party or any of its Subsidiaries or otherwise;
(c) any taking, exchange, release or non-perfection of
any Collateral or any other collateral, or any taking, release or
amendment or waiver of, or consent to departure from, any other
guaranty, for all or any of the KGaA Guaranteed Obligations or any
other Obligations of any other Loan Party under or in respect of the
Loan Documents;
(d) any manner of application of Collateral or any
other collateral, or proceeds thereof, to all or any of the KGaA
Guaranteed Obligations or any other Obligations of any other Loan
Party under or in respect of the Loan Documents, or any manner of
sale or other disposition of any Collateral or any other collateral
for all or any of the KGaA Guaranteed Obligations or any other
Obligations of any Loan Party under the Loan Documents or any other
assets of any Loan Party or any of its Subsidiaries;
2
(e) any change, restructuring or termination of the
corporate structure or existence of any Loan Party or any of its
Subsidiaries;
(f) any failure of any Lender to disclose to any Loan
Party any information relating to the business, condition (financial
or otherwise), operations, performance, properties or prospects of
any other Loan Party now or hereafter known to such Lender (each
KGaA Guarantor waiving any duty on the part of the Lenders to
disclose such information);
(g) the failure of any other Person to execute or
deliver this KGaA Guaranty, any KGaA Guaranty Supplement (as
hereinafter defined) or any other guaranty or agreement or the
release or reduction of liability of any KGaA Guarantor or other
guarantor or surety with respect to the KGaA Guaranteed Obligations
(other than in connection with the termination of this KGaA Guaranty
in accordance with the provisions of Section 11); or
(h) any other circumstance (including, without
limitation, any statute of limitations) or any existence of or
reliance on any representation by any Lender that might otherwise
constitute a defense available to, or a discharge of, any Loan Party
or any other guarantor or surety.
This KGaA Guaranty shall continue to be effective or be reinstated, as the
case may be, if at any time any payment of any of the KGaA Guaranteed
Obligations is rescinded or must otherwise be returned by any Lender or any
other Person (but only to the extent that such Person has a claim against a
Lender, or a Lender is liable to such Person, as a result of such rescission
or return) upon the insolvency, bankruptcy or reorganization of the Euro
Borrower or any other Loan Party or otherwise, all as though such payment had
not been made.
Section 3. Waivers and Acknowledgments. (a) Each KGaA
Guarantor hereby unconditionally and irrevocably waives promptness, diligence,
notice of acceptance, presentment, demand for performance, notice of
nonperformance, default, acceleration, protest or dishonor and any other
notice with respect to any of the KGaA Guaranteed Obligations and this KGaA
Guaranty and any requirement that any Lender protect, secure, perfect or
insure any Lien or any property subject thereto or exhaust any right or take
any action against any Loan Party or any other Person or any Collateral.
(b) Each KGaA Guarantor hereby unconditionally and
irrevocably waives any right to revoke this KGaA Guaranty and acknowledges
that this KGaA Guaranty is continuing in nature and applies to all KGaA
Guaranteed Obligations, whether existing now or in the future.
(c) Each KGaA Guarantor hereby unconditionally and
irrevocably waives (i) any defense arising by reason of any claim or defense
based upon an election of remedies by any Lender that in any manner impairs,
reduces, releases or otherwise adversely affects the subrogation,
reimbursement, exoneration, contribution or indemnification rights of such
KGaA Guarantor or other rights of such KGaA Guarantor to proceed against any
of the other Loan Parties, any other guarantor or any other Person or any
Collateral and (ii) any defense based on
3
any right of set-off or counterclaim against or in respect of the Obligations
of such KGaA Guarantor hereunder.
(d) Each KGaA Guarantor acknowledges that the Administrative
Agent may, without notice to or demand upon such KGaA Guarantor and without
affecting the liability of such KGaA Guarantor under this KGaA Guaranty,
foreclose under any mortgage by nonjudicial sale, and each KGaA Guarantor
hereby waives any defense to the recovery by the Administrative Agent and the
other Lenders against such KGaA Guarantor of any deficiency after such
nonjudicial sale and any defense or benefits that may be afforded by
applicable Law.
(e) Each KGaA Guarantor hereby unconditionally and
irrevocably waives any duty on the part of any Lender to disclose to such KGaA
Guarantor any matter, fact or thing relating to the business, condition
(financial or otherwise), operations, performance, properties or prospects of
any other Loan Party or any of its Subsidiaries now or hereafter known by such
Lender.
(f) Each KGaA Guarantor acknowledges that it will receive
substantial direct and indirect benefits from the financing arrangements
contemplated by the Loan Documents and that the waivers set forth in Section 2
and this Section 3 are knowingly made in contemplation of such benefits.
Section 4. Subrogation. Each KGaA Guarantor hereby
unconditionally and irrevocably agrees not to exercise any rights that it may
now have or hereafter acquire against the Euro Borrower or any other Loan
Party that arise from the existence, payment, performance or enforcement of
such KGaA Guarantor's Obligations under or in respect of this KGaA Guaranty or
any other Loan Document, including, without limitation, any right of
subrogation, reimbursement, exoneration, contribution or indemnification and
any right to participate in any claim or remedy of any Lender against the Euro
Borrower or any other Loan Party or any Collateral, 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
Subsidiary Borrower or any other Loan Party, 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, remedy or right, unless and until (a) all of the KGaA
Guaranteed Obligations shall have been paid in full in cash (other than L/C
Obligations), (b) all Letters of Credit shall have expired or been terminated
or Cash Collateralized and (c) the Commitments shall have expired or been
terminated (the first date on which all of the foregoing conditions have been
met being the "Termination Date"); provided, however, that in the case of the
termination or expiration of all Letters of Credit, as described in clause (b)
above (and not in the case of a Cash Collateralization as described in clause
(b) above), the Termination Date shall not occur until (i) all L/C
Obligations, to the extent such Obligations constitute KGaA Guaranteed
Obligations, shall have been paid in full in cash and (ii) all of the other
conditions in clauses (a) through (c) have been met. If any amount shall be
paid to any KGaA Guarantor in violation of the immediately preceding sentence
at any time prior to the Termination Date, such amount shall be received and
held in trust for the benefit of the Lenders, shall be segregated from other
property and funds of such KGaA Guarantor and shall forthwith be paid or
delivered to the Administrative Agent in the same form as so received (with
any necessary endorsement or assignment) to be credited and applied to the
KGaA Guaranteed Obligations, whether matured or unmatured, in accordance with
the terms of the Loan
4
Documents, or to be held as Collateral for any KGaA Guaranteed Obligations
thereafter arising. If any KGaA Guarantor shall make payment to any Lender of
all or any part of the KGaA Guaranteed Obligations and the Termination Date
shall have occurred, the Lenders will, at such KGaA Guarantor's request and
expense, execute and deliver to such KGaA Guarantor appropriate documents,
without recourse and without representation or warranty, necessary to evidence
the transfer by subrogation to such KGaA Guarantor of an interest in the KGaA
Guaranteed Obligations resulting from such payment made by such KGaA Guarantor
pursuant to this KGaA Guaranty.
Section 5. Payments Free and Clear of Taxes, Etc. Any and
all payments by or on account of any Obligation of any KGaA Guarantor
hereunder shall be made free and clear of and without reduction or withholding
for any Indemnified Taxes or Other Taxes on the same terms and to the same
extent that payments by the Borrowers are required to be made free and clear
of Indemnified Taxes and Other Taxes pursuant to the terms of Section 3.01 of
the Credit Agreement.
Section 6. Representations and Warranties. Each KGaA
Guarantor hereby makes each representation and warranty made in the Loan
Documents by the Borrowers with respect to such KGaA Guarantor and each KGaA
Guarantor hereby further represents and warrants as follows:
(a) There are no conditions precedent to the
effectiveness of this KGaA Guaranty that have not been satisfied or
waived.
(b) Such KGaA Guarantor has, independently and without
reliance upon any Lender and based on such documents and information
as it has deemed appropriate, made its own credit analysis and
decision to enter into this KGaA Guaranty and each other Loan
Document to which it is or is to be a party, and such KGaA Guarantor
has established adequate means of obtaining from each other Loan
Party on a continuing basis information pertaining to, and is now
and on a continuing basis will be completely familiar with, the
business, condition (financial or otherwise), operations,
performance, properties and prospects of such other Loan Party.
Section 7. Covenants. Each KGaA Guarantor covenants and
agrees that, so long as the Termination Date shall not have occurred, such
KGaA Guarantor will perform and observe, and cause each of its Subsidiaries to
perform and observe, all of the terms, covenants and agreements set forth in
the Loan Documents on its or their part to be performed or observed or that
the Borrowers have agreed to cause such KGaA Guarantor or such Subsidiaries to
perform or observe.
Section 8. Amendments, KGaA Guaranty Supplements, Etc. (a)
No amendment or waiver of any provision of this KGaA Guaranty and no consent
to any departure by any KGaA Guarantor therefrom shall in any event be
effective unless the same shall be in writing and signed as required by
Section 10.01 of the Credit Agreement and signed by the KGaA Guarantors, and
then such waiver or consent shall be effective only in the specific instance
and for the specific purpose for which given. Upon the sale or dissolution of
a KGaA Guarantor or in the event that any KGaA Guarantor is designated a
Dormant Subsidiary, in each case, to the
5
extent permitted in accordance with the terms of the Loan Documents, such KGaA
Guarantor shall be automatically released from the KGaA Guaranty.
(b) Upon the execution and delivery by any Person of a
guaranty supplement in substantially the form of Exhibit A hereto (each, a
"KGaA Guaranty Supplement"), (i) such Person shall be referred to as an
"Additional KGaA Guarantor" and shall become and be a KGaA Guarantor
hereunder, and each reference in this KGaA Guaranty to a "KGaA Guarantor"
shall also mean and be a reference to such Additional KGaA Guarantor, and each
reference in any other Loan Document to a "KGaA Guarantor" or a "Guarantor"
shall also mean and be a reference to such Additional KGaA Guarantor, and (ii)
each reference herein to "this KGaA Guaranty", "hereunder", "hereof" or words
of like import referring to this KGaA Guaranty, and each reference in any
other Loan Document to the "KGaA Guaranty", "thereunder", "thereof" or words
of like import referring to this KGaA Guaranty, shall mean and be a reference
to this KGaA Guaranty as supplemented by such KGaA Guaranty Supplement.
Section 9. No Waiver; Remedies. No failure on the part of
any Lender to exercise, and no delay in exercising, any right or remedy
hereunder shall operate as a waiver thereof; nor shall any single or partial
exercise of any right or remedy hereunder preclude any other or further
exercise thereof or the exercise of any other right or remedy. The rights and
remedies herein provided are cumulative and not exclusive of any rights or
remedies provided by Law.
Section 10. Subordination. Each KGaA Guarantor hereby
subordinates any and all debts, liabilities and other obligations owed to such
KGaA Guarantor by each other Loan Party (the "Subordinated Obligations") to
the KGaA Guaranteed Obligations to the extent and in the manner hereinafter
set forth in this Section 10:
(a) Prohibited Payments, Etc. Except during the
continuance of an Event of Default (including the commencement and
continuation of any proceeding under any Bankruptcy Law relating to
any other Loan Party), each KGaA Guarantor may receive regularly
scheduled payments from any other Loan Party on account of the
Subordinated Obligations. After the occurrence and during the
continuance of any Event of Default (including the commencement and
continuation of any proceeding under any Bankruptcy Law relating to
any other Loan Party) that has not been waived in accordance with
Section 10.01 of the Credit Agreement, no KGaA Guarantor shall
demand, accept or take any action to collect any payment on account
of the Subordinated Obligations.
(b) Prior Payment of KGaA Guaranteed Obligations. In
any proceeding under any Bankruptcy Law relating to any other Loan
Party, each KGaA Guarantor consents to the Lenders receiving payment
in full in cash of all KGaA Guaranteed Obligations (including all
interest and expenses accruing after the commencement of a
proceeding under any Bankruptcy Law, whether or not constituting an
allowed claim in such proceeding ("Post Petition Interest")) before
such KGaA Guarantor receives payment of any Subordinated
Obligations.
(c) Turn-Over. After the occurrence and during the
continuance of an Event of Default (including the commencement and
continuation of any proceeding under any
6
Bankruptcy Law relating to any other Loan Party), each KGaA
Guarantor shall, if the Administrative Agent so requests, collect,
enforce and receive payments on account of the Subordinated
Obligations as trustee for the Lenders and deliver such payments to
the Administrative Agent on account of the KGaA Guaranteed
Obligations (including all Post Petition Interest), together with
any necessary endorsements or other instruments of transfer, but
without reducing or affecting in any manner the liability of such
KGaA Guarantor under the other provisions of this KGaA Guaranty.
(d) Administrative Agent Authorization. After the
occurrence and during the continuance of an Event of Default
(including the commencement and continuation of any proceeding under
any Bankruptcy Law relating to any other Loan Party), the
Administrative Agent is authorized and empowered (but without any
obligation to so do), in its discretion, (i) in the name of each
KGaA Guarantor, to collect and enforce, and to submit claims in
respect of, Subordinated Obligations and to apply any amounts
received thereon to the KGaA Guaranteed Obligations (including any
and all Post Petition Interest), and (ii) to require each KGaA
Guarantor (A) to collect and enforce, and to submit claims in
respect of, Subordinated Obligations and (B) to pay any amounts
received on such obligations to the Administrative Agent for
application to the KGaA Guaranteed Obligations (including any and
all Post Petition Interest).
Section 11. Continuing Guaranty; Assignments under the
Credit Agreement. This KGaA Guaranty is a continuing guaranty and shall (a)
remain in full force and effect until the Termination Date, (b) be binding
upon each KGaA Guarantor, its successors and assigns and (c) inure to the
benefit of and be enforceable by the Lenders and their successors, transferees
and assigns. Without limiting the generality of clause (c) of the immediately
preceding sentence, any Lender may assign or otherwise transfer all or any
portion of its rights and obligations under the Credit Agreement (including,
without limitation, all or any portion of its Commitments, the Loans owing to
it and any Note or Notes held by it) to any other Person, and such other
Person shall thereupon become vested with all the benefits in respect thereof
granted to such Lender herein or otherwise, in each case as and to the extent
provided in Section 10.06 of the Credit Agreement. No KGaA Guarantor shall
have the right to assign its rights hereunder or any interest herein without
the prior written consent of the Lenders.
Section 12. Execution in Counterparts. This KGaA Guaranty
and each amendment, waiver and consent with respect hereto may be executed in
any number of counterparts and by different parties thereto in separate
counterparts, each of which when so executed shall be deemed to be an original
and all of which taken together shall constitute one and the same agreement.
Delivery of an executed counterpart of a signature page to this KGaA Guaranty
by telecopy or by an electronically mailed scanned copy shall be effective as
delivery of an original executed counterpart of this KGaA Guaranty.
Section 13. Governing Law; Jurisdiction; Waiver of Jury
Trial, Etc. (a) This KGaA Guaranty shall be governed by, and construed in
accordance with, the Laws of the State of New York.
(b) Each KGaA Guarantor hereby irrevocably and
unconditionally submits, for itself and its property, to the nonexclusive
jurisdiction of any New York State court or federal
7
court of the United States of America sitting in New York City, and any
appellate court from any thereof, in any action or proceeding arising out of
or relating to this KGaA Guaranty or any of the other Loan Documents to which
it is or is to be a party, or for recognition or enforcement of any judgment,
and each KGaA Guarantor hereby irrevocably and unconditionally agrees that all
claims in respect of any such action or proceeding may be heard and determined
in any such New York State court or, to the extent permitted by Law, in such
federal court. Each KGaA Guarantor agrees that a final judgment in any such
action or proceeding shall be conclusive and may be enforced in other
jurisdictions by suit on the judgment or in any other manner provided by Law.
Nothing in this KGaA Guaranty or any other Loan Document shall affect any
right that any party may otherwise have to bring any action or proceeding
relating to this KGaA Guaranty or any other Loan Document in the courts of any
jurisdiction.
(c) Each KGaA Guarantor irrevocably and unconditionally
waives, to the fullest extent it may legally and effectively do so, any
objection that it may now or hereafter have to the laying of venue of any
suit, action or proceeding arising out of or relating to this KGaA Guaranty or
any of the other Loan Documents to which it is or is to be a party in any New
York State or federal court. Each KGaA Guarantor hereby irrevocably waives, to
the fullest extent permitted by Law, the defense of an inconvenient forum to
the maintenance of such suit, action or proceeding in any such court.
(d) EACH KGAA GUARANTOR HEREBY IRREVOCABLY WAIVES ALL RIGHT
TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM (WHETHER BASED ON
CONTRACT, TORT OR OTHERWISE) ARISING OUT OF OR RELATING TO ANY OF THE LOAN
DOCUMENTS, THE LOANS OR THE ACTIONS OF ANY LENDER IN THE NEGOTIATION,
ADMINISTRATION, PERFORMANCE OR ENFORCEMENT THEREOF.
8
IN WITNESS WHEREOF, each KGaA Guarantor has caused this KGaA
Guaranty to be duly executed and delivered by its officer thereunto duly
authorized as of the date first above written.
RAYOVAC CORPORATION
By /s/ James T. Lucke
---------------------------------------
Name: James T. Lucke
Title: Senior Vice President, Secretary
and General Counsel
ROV INTERNATIONAL FINANCE COMPANY
By /s/ James T. Lucke
---------------------------------------
Name: James T. Lucke
Title: Secretary and Treasurer
RAYOVAC EUROPE GmbH
By /s/ Andreas Rouve
---------------------------------------
Name: Andreas Rouve
Title: Chief Financial Officer
By /s/ Remy Burel
---------------------------------------
Name: Remy Burel
Title: Chief Executive Officer
ROV GERMAN GENERAL PARTNER GmbH
By /s/ Andreas Rouve
---------------------------------------
Name: Andreas Rouve
Title: Chief Financial Officer
By /s/ Remy Burel
---------------------------------------
Name: Remy Burel
Title: Chief Executive Officer
ROV GERMAN LIMITED GmbH
By /s/ Andreas Rouve
---------------------------------------
Name: Andreas Rouve
Title: Chief Financial Officer
By /s/ Remy Burel
---------------------------------------
Name: Remy Burel
Title: Chief Executive Officer
9
EXHIBIT A
KGaA GUARANTY SUPPLEMENT
[Omitted. A supplemental copy of this exhibit will be
furnished to the SEC upon request.]
EXHIBIT 10.5
UK GUARANTY
Dated as of February 7, 2005
From
THE UK GUARANTORS NAMED HEREIN
and
THE ADDITIONAL UK GUARANTORS REFERRED TO HEREIN
as UK Guarantors
in favor of
THE LENDERS REFERRED TO IN
THE CREDIT AGREEMENT REFERRED TO HEREIN
T A B L E O F C O N T E N T S
Section Page
Section 1. Guaranty; Limitation of Liability...............................1
Section 2. Guaranty Absolute...............................................2
Section 3. Waivers and Acknowledgments.....................................3
Section 4. Subrogation.....................................................4
Section 5. Payments Free and Clear of Taxes, Etc...........................5
Section 6. Representations and Warranties..................................5
Section 7. Covenants.......................................................5
Section 8. Amendments, UK Guaranty Supplements, Etc........................5
Section 9. No Waiver; Remedies.............................................6
Section 10. Subordination..................................................6
Section 11. Continuing Guaranty; Assignments under the Credit Agreement....7
Section 12. Execution in Counterparts......................................7
Section 13. Governing Law; Jurisdiction; Waiver of Jury Trial, Etc.........7
Exhibit A - UK Guaranty Supplement
UK GUARANTY
UK GUARANTY dated as of February 7, 2005 made by the Persons listed on
the signature pages hereof under the caption "UK Guarantors" and the Additional
UK Guarantors (as defined in Section 8(b)) (such Persons so listed and the
Additional UK Guarantors being, collectively, the "UK Guarantors" and,
individually, each a "UK Guarantor") in favor of the Lenders (as defined in the
Credit Agreement referred to below).
PRELIMINARY STATEMENT. Rayovac Corporation, a Wisconsin corporation
(the "U.S. Borrower"), Varta Consumer BatteriesGmbH & Co. UK, a German
partnership limited by shares (the "Euro Borrower") and Rayovac Europe Limited,
a limited liability company (the "UK Borrower" and, together with the U.S.
Borrower and the Euro Borrower, each a "Borrower" and collectively the
"Borrowers") are party to a Fourth Amended and Restated Credit Agreement dated
as of February 7, 2005 (as amended, amended and restated, supplemented or
otherwise modified from time to time, the "Credit Agreement"; the capitalized
terms defined therein and not otherwise defined herein being used herein as
therein defined) with certain Lenders party thereto, and Bank of America, N.A.,
as Administrative Agent for such Lenders. Each UK Guarantor will derive
substantial direct and indirect benefits from the transactions contemplated by
the Credit Agreement. It is a condition precedent to the making of Loans by the
Lenders and the issuance of Letters of Credit by the L/C Issuer under the
Credit Agreement from time to time that each UK Guarantor shall have executed
and delivered this UK Guaranty.
NOW, THEREFORE, in consideration of the premises and in order to
induce the Lenders to make Loans and the L/C Issuer to issue Letters of Credit
under the Credit Agreement from time to time, each UK Guarantor, jointly and
severally with each other UK Guarantor, hereby agrees as follows:
Section 1. Guaranty; Limitation of Liability. (a) Each UK Guarantor
hereby absolutely, unconditionally and irrevocably guarantees the punctual
payment when due, whether at scheduled maturity or on any date of a required
prepayment or by acceleration, demand or otherwise, of all Obligations of the
UK Borrower now or hereafter existing under or in respect of the Loan Documents
(including, without limitation, any extensions, modifications, substitutions,
amendments or renewals of any or all of the foregoing Obligations) (such
Obligations being the "UK Guaranteed Obligations"); provided, however, that for
purposes of this UK Guaranty, the term "Loan Documents" shall not include (i)
any agreement evidencing or Guaranteeing a Qualified Foreign Credit Facility or
(ii) any Secured Hedge Agreement. Without limiting the generality of the
foregoing, each UK Guarantor's liability shall extend to all amounts that
constitute part of the UK Guaranteed Obligations and would be owed by the UK
Borrower to any Lender under or in respect of the Loan Documents but for the
fact that they are unenforceable or not allowable due to the existence of a
bankruptcy, reorganization or similar proceeding involving such other Loan
Party.
(b) Each UK Guarantor, and by its acceptance of this UK Guaranty, the
Administrative Agent and each other Lender, hereby confirms that it is the
intention of all such Persons that this UK Guaranty and the Obligations of each
UK Guarantor hereunder not constitute a fraudulent transfer or conveyance for
purposes of any Bankruptcy Law (as
1
hereinafter defined), the Uniform Fraudulent Conveyance Act, the Uniform
Fraudulent Transfer Act or any similar foreign, federal or state Law to the
extent applicable to this UK Guaranty and the Obligations of each UK Guarantor
hereunder. To effectuate the foregoing intention, the Administrative Agent, the
other Lenders and the UK Guarantors hereby irrevocably agree that the
Obligations of each UK Guarantor under this UK Guaranty at any time shall be
limited to the maximum amount as will result in the Obligations of such UK
Guarantor under this UK Guaranty not constituting a fraudulent transfer or
conveyance. For purposes hereof, "Bankruptcy Law" means any proceeding of the
type referred to in Section 8.01(f) of the Credit Agreement or Title 11, U.S.
Code, or any similar foreign, federal or state Law for the relief of debtors.
Section 2. Guaranty Absolute. Each UK Guarantor guarantees that the UK
Guaranteed Obligations will be paid in accordance with the terms of the Loan
Documents, regardless of any Law, regulation or order now or hereafter in
effect in any jurisdiction affecting any of such terms or the rights of any
Lender with respect thereto to the fullest extent permitted by applicable Law.
The Obligations of each UK Guarantor under or in respect of this UK Guaranty
are independent of the UK Guaranteed Obligations or any other Obligations of
any other Loan Party under or in respect of the Loan Documents, and a separate
action or actions may be brought and prosecuted against each UK Guarantor to
enforce this UK Guaranty, irrespective of whether any action is brought against
the UK Borrower or any other Loan Party or whether the UK Borrower or any other
Loan Party is joined in any such action or actions. The liability of each UK
Guarantor under this UK Guaranty shall be irrevocable, absolute and
unconditional irrespective of, and each UK Guarantor hereby irrevocably waives
to the fullest extent permitted by applicable Law any defenses it may now have
or hereafter acquire in any way relating to, any or all of the following:
(a) any lack of validity or enforceability of any Loan Document or any
agreement or instrument relating thereto;
(b) any change in the time, manner or place of payment of, or in any
other term of, all or any of the UK Guaranteed Obligations or any other
Obligations of any other Loan Party under or in respect of the Loan
Documents, or any other amendment or waiver of or any consent to departure
from any Loan Document, including, without limitation, any increase in the
UK Guaranteed Obligations resulting from the extension of additional
credit to any Loan Party or any of its Subsidiaries or otherwise;
(c) any taking, exchange, release or non-perfection of any Collateral
or any other collateral, or any taking, release or amendment or waiver of,
or consent to departure from, any other guaranty, for all or any of the UK
Guaranteed Obligations or any other Obligations of any other Loan Party
under or in respect of the Loan Documents;
(d) any manner of application of Collateral or any other collateral,
or proceeds thereof, to all or any of the UK Guaranteed Obligations or any
other Obligations of any other Loan Party under or in respect of the Loan
Documents, or any manner of sale or other disposition of any Collateral or
any other collateral for all or any of the UK Guaranteed Obligations or
any other Obligations of any Loan Party under the Loan Documents or any
other assets of any Loan Party or any of its Subsidiaries;
2
(e) any change, restructuring or termination of the corporate
structure or existence of any Loan Party or any of its Subsidiaries;
(f) any failure of any Lender to disclose to any Loan Party any
information relating to the business, condition (financial or otherwise),
operations, performance, properties or prospects of any other Loan Party
now or hereafter known to such Lender (each UK Guarantor waiving any duty
on the part of the Lenders to disclose such information);
(g) the failure of any other Person to execute or deliver this UK
Guaranty, any UK Guaranty Supplement (as hereinafter defined) or any other
guaranty or agreement or the release or reduction of liability of any UK
Guarantor or other guarantor or surety with respect to the UK Guaranteed
Obligations (other than in connection with the termination of this UK
Guaranty in accordance with the provisions of Section 11); or
(h) any other circumstance (including, without limitation, any statute
of limitations) or any existence of or reliance on any representation by
any Lender that might otherwise constitute a defense available to, or a
discharge of, any Loan Party or any other guarantor or surety.
This UK Guaranty shall continue to be effective or be reinstated, as the case
may be, if at any time any payment of any of the UK Guaranteed Obligations is
rescinded or must otherwise be returned by any Lender or any other Person (but
only to the extent that such Person has a claim against a Lender, or a Lender
is liable to such Person, as a result of such rescission or return) upon the
insolvency, bankruptcy or reorganization of the UK Borrower or any other Loan
Party or otherwise, all as though such payment had not been made.
Section 3. Waivers and Acknowledgments. (a) Each UK Guarantor hereby
unconditionally and irrevocably waives promptness, diligence, notice of
acceptance, presentment, demand for performance, notice of nonperformance,
default, acceleration, protest or dishonor and any other notice with respect to
any of the UK Guaranteed Obligations and this UK Guaranty and any requirement
that any Lender protect, secure, perfect or insure any Lien or any property
subject thereto or exhaust any right or take any action against any Loan Party
or any other Person or any Collateral.
(b) Each UK Guarantor hereby unconditionally and irrevocably waives
any right to revoke this UK Guaranty and acknowledges that this UK Guaranty is
continuing in nature and applies to all UK Guaranteed Obligations, whether
existing now or in the future.
(c) Each UK Guarantor hereby unconditionally and irrevocably waives
(i) any defense arising by reason of any claim or defense based upon an
election of remedies by any Lender that in any manner impairs, reduces,
releases or otherwise adversely affects the subrogation, reimbursement,
exoneration, contribution or indemnification rights of such UK Guarantor or
other rights of such UK Guarantor to proceed against any of the other Loan
Parties, any other guarantor or any other Person or any Collateral and (ii) any
defense based on any right of set-off or counterclaim against or in respect of
the Obligations of such UK Guarantor hereunder.
3
(d) Each UK Guarantor acknowledges that the Administrative Agent may,
without notice to or demand upon such UK Guarantor and without affecting the
liability of such UK Guarantor under this UK Guaranty, foreclose under any
mortgage by nonjudicial sale, and each UK Guarantor hereby waives any defense
to the recovery by the Administrative Agent and the other Lenders against such
UK Guarantor of any deficiency after such nonjudicial sale and any defense or
benefits that may be afforded by applicable Law.
(e) Each UK Guarantor hereby unconditionally and irrevocably waives
any duty on the part of any Lender to disclose to such UK Guarantor any matter,
fact or thing relating to the business, condition (financial or otherwise),
operations, performance, properties or prospects of any other Loan Party or any
of its Subsidiaries now or hereafter known by such Lender.
(f) Each UK Guarantor acknowledges that it will receive substantial
direct and indirect benefits from the financing arrangements contemplated by
the Loan Documents and that the waivers set forth in Section 2 and this Section
3 are knowingly made in contemplation of such benefits.
Section 4. Subrogation. Each UK Guarantor hereby unconditionally and
irrevocably agrees not to exercise any rights that it may now have or hereafter
acquire against the UK Borrower or any other Loan Party that arise from the
existence, payment, performance or enforcement of such UK Guarantor's
Obligations under or in respect of this UK Guaranty or any other Loan Document,
including, without limitation, any right of subrogation, reimbursement,
exoneration, contribution or indemnification and any right to participate in
any claim or remedy of any Lender against the UK Borrower or any other Loan
Party or any Collateral, 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 Subsidiary Borrower or any other Loan
Party, 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, remedy or
right, unless and until (a) all of the UK Guaranteed Obligations shall have
been paid in full in cash (other than L/C Obligations), (b) all Letters of
Credit shall have expired or been terminated or Cash Collateralized and (c) the
Commitments shall have expired or been terminated (the first date on which all
of the foregoing conditions have been met being the "Termination Date");
provided, however, that in the case of the termination or expiration of all
Letters of Credit, as described in clause (b) above (and not in the case of a
Cash Collateralization as described in clause (b) above), the Termination Date
shall not occur until (i) all L/C Obligations, to the extent such Obligations
constitute UK Guaranteed Obligations, shall have been paid in full in cash and
(ii) all of the other conditions in clauses (a) through (c) have been met. If
any amount shall be paid to any UK Guarantor in violation of the immediately
preceding sentence at any time prior to the Termination Date, such amount shall
be received and held in trust for the benefit of the Lenders, shall be
segregated from other property and funds of such UK Guarantor and shall
forthwith be paid or delivered to the Administrative Agent in the same form as
so received (with any necessary endorsement or assignment) to be credited and
applied to the UK Guaranteed Obligations, whether matured or unmatured, in
accordance with the terms of the Loan Documents, or to be held as Collateral
for any UK Guaranteed Obligations thereafter arising. If any UK Guarantor shall
make payment to any Lender of all or any part of the UK Guaranteed Obligations
and the Termination Date shall have occurred, the Lenders will, at such UK
Guarantor's request and expense, execute and deliver to
4
such UK Guarantor appropriate documents, without recourse and without
representation or warranty, necessary to evidence the transfer by subrogation
to such UK Guarantor of an interest in the UK Guaranteed Obligations resulting
from such payment made by such UK Guarantor pursuant to this UK Guaranty.
Section 5. Payments Free and Clear of Taxes, Etc. Any and all payments
by or on account of any Obligation of any UK Guarantor hereunder shall be made
free and clear of and without reduction or withholding for any Indemnified
Taxes or Other Taxes on the same terms and to the same extent that payments by
the Borrowers are required to be made free and clear of Indemnified Taxes and
Other Taxes pursuant to the terms of Section 3.01 of the Credit Agreement.
Section 6. Representations and Warranties. Each UK Guarantor hereby
makes each representation and warranty made in the Loan Documents by the
Borrowers with respect to such UK Guarantor and each UK Guarantor hereby
further represents and warrants as follows:
(a) There are no conditions precedent to the effectiveness of this UK
Guaranty that have not been satisfied or waived.
(b) Such UK Guarantor has, independently and without reliance upon any
Lender and based on such documents and information as it has deemed
appropriate, made its own credit analysis and decision to enter into this
UK Guaranty and each other Loan Document to which it is or is to be a
party, and such UK Guarantor has established adequate means of obtaining
from each other Loan Party on a continuing basis information pertaining
to, and is now and on a continuing basis will be completely familiar with,
the business, condition (financial or otherwise), operations, performance,
properties and prospects of such other Loan Party.
Section 7. Covenants. Each UK Guarantor covenants and agrees that, so
long as the Termination Date shall not have occurred, such UK Guarantor will
perform and observe, and cause each of its Subsidiaries to perform and observe,
all of the terms, covenants and agreements set forth in the Loan Documents on
its or their part to be performed or observed or that the Borrowers have agreed
to cause such UK Guarantor or such Subsidiaries to perform or observe.
Section 8. Amendments, UK Guaranty Supplements, Etc. (a) No amendment
or waiver of any provision of this UK Guaranty and no consent to any departure
by any UK Guarantor therefrom shall in any event be effective unless the same
shall be in writing and signed as required by Section 10.01 of the Credit
Agreement and signed by the UK Guarantors, and then such waiver or consent
shall be effective only in the specific instance and for the specific purpose
for which given. Upon the sale or dissolution of a UK Guarantor or in the event
that any UK Guarantor is designated a Dormant Subsidiary, in each case, to the
extent permitted in accordance with the terms of the Loan Documents, such UK
Guarantor shall be automatically released from the UK Guaranty.
(b) Upon the execution and delivery by any Person of a guaranty
supplement in substantially the form of Exhibit A hereto (each, a "UK Guaranty
Supplement"), (i) such Person shall be referred to as an "Additional UK
Guarantor" and shall become and be a UK
5
Guarantor hereunder, and each reference in this UK Guaranty to a "UK Guarantor"
shall also mean and be a reference to such Additional UK Guarantor, and each
reference in any other Loan Document to a "UK Guarantor" or a "Guarantor" shall
also mean and be a reference to such Additional UK Guarantor, and (ii) each
reference herein to "this UK Guaranty", "hereunder", "hereof" or words of like
import referring to this UK Guaranty, and each reference in any other Loan
Document to the "UK Guaranty", "thereunder", "thereof" or words of like import
referring to this UK Guaranty, shall mean and be a reference to this UK
Guaranty as supplemented by such UK Guaranty Supplement.
Section 9. No Waiver; Remedies. No failure on the part of any Lender
to exercise, and no delay in exercising, any right or remedy hereunder shall
operate as a waiver thereof; nor shall any single or partial exercise of any
right or remedy hereunder preclude any other or further exercise thereof or the
exercise of any other right or remedy. The rights and remedies herein provided
are cumulative and not exclusive of any rights or remedies provided by Law.
Section 10. Subordination. Each UK Guarantor hereby subordinates any
and all debts, liabilities and other obligations owed to such UK Guarantor by
each other Loan Party (the "Subordinated Obligations") to the UK Guaranteed
Obligations to the extent and in the manner hereinafter set forth in this
Section 10:
(a) Prohibited Payments, Etc. Except during the continuance of an
Event of Default (including the commencement and continuation of any
proceeding under any Bankruptcy Law relating to any other Loan Party),
each UK Guarantor may receive regularly scheduled payments from any other
Loan Party on account of the Subordinated Obligations. After the
occurrence and during the continuance of any Event of Default (including
the commencement and continuation of any proceeding under any Bankruptcy
Law relating to any other Loan Party) that has not been waived in
accordance with Section 10.01 of the Credit Agreement, no UK Guarantor
shall demand, accept or take any action to collect any payment on account
of the Subordinated Obligations.
(b) Prior Payment of UK Guaranteed Obligations. In any proceeding
under any Bankruptcy Law relating to any other Loan Party, each UK
Guarantor consents to the Lenders receiving payment in full in cash of all
UK Guaranteed Obligations (including all interest and expenses accruing
after the commencement of a proceeding under any Bankruptcy Law, whether
or not constituting an allowed claim in such proceeding ("Post Petition
Interest")) before such UK Guarantor receives payment of any Subordinated
Obligations.
(c) Turn-Over. After the occurrence and during the continuance of an
Event of Default (including the commencement and continuation of any
proceeding under any Bankruptcy Law relating to any other Loan Party),
each UK Guarantor shall, if the Administrative Agent so requests, collect,
enforce and receive payments on account of the Subordinated Obligations as
trustee for the Lenders and deliver such payments to the Administrative
Agent on account of the UK Guaranteed Obligations (including all Post
Petition Interest), together with any necessary endorsements or other
instruments of
6
transfer, but without reducing or affecting in any manner the liability of
such UK Guarantor under the other provisions of this UK Guaranty.
(d) Administrative Agent Authorization. After the occurrence and
during the continuance of an Event of Default (including the commencement
and continuation of any proceeding under any Bankruptcy Law relating to
any other Loan Party), the Administrative Agent is authorized and
empowered (but without any obligation to so do), in its discretion, (i) in
the name of each UK Guarantor, to collect and enforce, and to submit
claims in respect of, Subordinated Obligations and to apply any amounts
received thereon to the UK Guaranteed Obligations (including any and all
Post Petition Interest), and (ii) to require each UK Guarantor (A) to
collect and enforce, and to submit claims in respect of, Subordinated
Obligations and (B) to pay any amounts received on such obligations to the
Administrative Agent for application to the UK Guaranteed Obligations
(including any and all Post Petition Interest).
Section 11. Continuing Guaranty; Assignments under the Credit
Agreement. This UK Guaranty is a continuing guaranty and shall (a) remain in
full force and effect until the Termination Date, (b) be binding upon each UK
Guarantor, its successors and assigns and (c) inure to the benefit of and be
enforceable by the Lenders and their successors, transferees and assigns.
Without limiting the generality of clause (c) of the immediately preceding
sentence, any Lender may assign or otherwise transfer all or any portion of its
rights and obligations under the Credit Agreement (including, without
limitation, all or any portion of its Commitments, the Loans owing to it and
any Note or Notes held by it) to any other Person, and such other Person shall
thereupon become vested with all the benefits in respect thereof granted to
such Lender herein or otherwise, in each case as and to the extent provided in
Section 10.06 of the Credit Agreement. No UK Guarantor shall have the right to
assign its rights hereunder or any interest herein without the prior written
consent of the Lenders.
Section 12. Execution in Counterparts. This UK Guaranty and each
amendment, waiver and consent with respect hereto may be executed in any number
of counterparts and by different parties thereto in separate counterparts, each
of which when so executed shall be deemed to be an original and all of which
taken together shall constitute one and the same agreement. Delivery of an
executed counterpart of a signature page to this UK Guaranty by telecopy or by
an electronically mailed scanned copy shall be effective as delivery of an
original executed counterpart of this UK Guaranty.
Section 13. Governing Law; Jurisdiction; Waiver of Jury Trial, Etc.
(a) This UK Guaranty shall be governed by, and construed in accordance with,
the Laws of the State of New York.
(b) Each UK Guarantor hereby irrevocably and unconditionally submits,
for itself and its property, to the nonexclusive jurisdiction of any New York
State court or federal court of the United States of America sitting in New
York City, and any appellate court from any thereof, in any action or
proceeding arising out of or relating to this UK Guaranty or any of the other
Loan Documents to which it is or is to be a party, or for recognition or
enforcement of any judgment, and each UK Guarantor hereby irrevocably and
unconditionally agrees that all claims in respect of any such action or
proceeding may be heard and determined in any such New York
7
State court or, to the extent permitted by Law, in such federal court. Each UK
Guarantor agrees that a final judgment in any such action or proceeding shall
be conclusive and may be enforced in other jurisdictions by suit on the
judgment or in any other manner provided by Law. Nothing in this UK Guaranty or
any other Loan Document shall affect any right that any party may otherwise
have to bring any action or proceeding relating to this UK Guaranty or any
other Loan Document in the courts of any jurisdiction.
(c) Each UK Guarantor irrevocably and unconditionally waives, to the
fullest extent it may legally and effectively do so, any objection that it may
now or hereafter have to the laying of venue of any suit, action or proceeding
arising out of or relating to this UK Guaranty or any of the other Loan
Documents to which it is or is to be a party in any New York State or federal
court. Each UK Guarantor hereby irrevocably waives, to the fullest extent
permitted by Law, the defense of an inconvenient forum to the maintenance of
such suit, action or proceeding in any such court.
(d) EACH UK GUARANTOR HEREBY IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY
JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM (WHETHER BASED ON CONTRACT, TORT
OR OTHERWISE) ARISING OUT OF OR RELATING TO ANY OF THE LOAN DOCUMENTS, THE
LOANS OR THE ACTIONS OF ANY LENDER IN THE NEGOTIATION, ADMINISTRATION,
PERFORMANCE OR ENFORCEMENT THEREOF.
8
IN WITNESS WHEREOF, each UK Guarantor has caused this UK
Guaranty to be duly executed and delivered by its officer thereunto duly
authorized as of the date first above written.
RAYOVAC CORPORATION
By /s/ James T. Lucke
--------------------------------------
Name: James T. Lucke
Title: Senior Vice President, Secretary
and General Counsel
ROV INTERNATIONAL FINANCE COMPANY
By /s/ James T. Lucke
--------------------------------------
Name: James T. Lucke
Title: Secretary and Treasurer
RAYOVAC EUROPE GmbH
By /s/ Andreas Rouve
--------------------------------------
Name: Andreas Rouve
Title: Chief Financial Officer
By /s/ Remy Burel
--------------------------------------
Name: Remy Burel
Title: Chief Executive Officer
9
EXHIBIT A
UK GUARANTY SUPPLEMENT
[Omitted. A supplemental copy of this exhibit will be
furnished to the SEC upon request.]
EXHIBIT 10.6
RAYOVAC CORPORATION
REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT (this "AGREEMENT") is entered into
by and among RAYOVAC CORPORATION, a Wisconsin corporation (the "COMPANY"), and
the Persons listed on Schedule 1 attached hereto, who were, immediately prior
to the Effective Time, stockholders of United Industries Corporation ("UNITED")
(collectively, the "SHAREHOLDERS"). Capitalized terms not defined herein shall
have the meanings assigned to such term in the Merger Agreement (as defined
below).
BACKGROUND STATEMENT
Pursuant to that certain Agreement and Plan of Merger dated January 3,
2005 (the "MERGER AGREEMENT") by and among the Company, Lindbergh Corporation
and United, the Shareholders may receive shares (the "SHARES") of the Company's
$0.01 par value common stock (the "COMMON STOCK"). The Company has agreed to
provide certain registration rights with respect to the Shares in accordance
with this Agreement.
STATEMENT OF AGREEMENT
NOW, THEREFORE, in consideration of the mutual representations,
warranties, covenants and agreements contained herein, and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, and intending to be legally bound hereby, the parties agree as
follows:
1. CERTAIN DEFINITIONS. As used in this Agreement, the following terms
shall have the following respective meanings:
"COMMISSION" shall mean the Securities and Exchange Commission, or any
other federal agency at the time administering the Securities Act.
"EXCHANGE ACT" shall mean the Securities Exchange Act of 1934, as
amended, or any similar federal statute, and the rules and regulations of the
Commission thereunder, all as the same shall be in effect at the time.
1
"REGISTRATION EXPENSES" shall mean the expenses so described in
Section 6.
"REGISTRATION STATEMENT" shall mean the Shelf Registration Statement
or Demand Registration Statement (each defined in Section 2) and any additional
registration statements contemplated by Sections 2 or 3, including (in each
case) the prospectus, amendments and supplements to such registration statement
or prospectus, all exhibits attached thereto, and all material incorporated by
reference or deemed to be incorporated by reference in such registration
statement.
"RESTRICTED STOCK" shall mean the Shares, excluding Shares which have
been (a) registered under the Securities Act pursuant to an effective
Registration Statement filed thereunder and disposed of in accordance with the
Registration Statement covering them or (b) publicly sold pursuant to Rule 144
under the Securities Act.
"SECURITIES ACT" shall mean the Securities Act of 1933, as amended, or
any similar federal statute, and the rules and regulations of the Commission
thereunder, all as the same shall be in effect at the time.
"SELLING EXPENSES" shall mean the expenses so described in Section 6.
"STATE ACTS" shall mean the applicable securities or "blue sky" laws
of the States of the United States, as amended, and the rules and regulations
thereunder, all as the same shall be in effect at the time.
2. REQUIRED REGISTRATIONS.
(a) The Company will, (i) within nine (9) months following the
Effective Time, prepare and file with the Commission a Registration Statement
on Form S-1 or, if applicable, Form S-3, or any equivalent form for
registration by issuers in accordance with the Securities Act, to permit the
resale from time to time of the Restricted Stock under the Securities Act on a
delayed or continuous basis pursuant to Rule 415 (the "SHELF REGISTRATION
STATEMENT"), (ii) use reasonable best efforts to cause the Shelf Registration
Statement to be declared effective (the "REGISTRATION EFFECTIVE DATE") within
twelve (12) months following the Effective Time and (iii) use reasonable best
efforts to cause the Shelf Registration Statement to remain effective until the
earlier of (x) the two (2) year anniversary of the Registration Effective Date
and (y) the date on which all of the Restricted Stock covered by the Shelf
Registration Statement has been sold to the public pursuant to such
registration statement in accordance with the intended methods of distribution
thereof (the "SHELF EXPIRATION DATE"). The plan of distribution contemplated by
the Shelf Registration Statement shall permit resales of Restricted Stock in
the manner or manners designated by the Shareholders, including offers and
sales through underwriters or agents, offers and sales directly to investors,
block trades and such other methods of offer and sale as the Shareholders shall
request. The Company shall not permit any securities other than Restricted
Stock to be included in the Shelf Registration Statement.
(b) Subject to Section 2(d), if, following the Registration
Effective Date, one or more Shareholders desires to sell Restricted Stock
in an underwritten offering pursuant to the Shelf
2
Registration Statement, such Shareholder or Shareholders may request in writing
that the Company file an amendment to the Shelf Registration Statement, stating
the number of shares of Restricted Stock proposed to be sold and describing the
plan of distribution, and the Company shall file such an amendment to the Shelf
Registration Statement as soon as reasonably practicable and use reasonable
best efforts to cause such amended Shelf Registration Statement to become
effective.
(c) Subject to Section 2(d), if at any time after the Shelf
Expiration Date, one or more Shareholders desires to sell Restricted Stock in
an underwritten public offering, such Shareholder or Shareholders may request
in writing that the Company (i) prepare and file with the Commission a
Registration Statement on Form S-1 or, if applicable, Form S-3, or any
equivalent form for registration by issuers in accordance with the Securities
Act, to register the sale of Restricted Stock under the Securities Act (the
"DEMAND REGISTRATION STATEMENT"), (ii) use its reasonable best efforts to cause
the Demand Registration Statement to be declared effective ("DEMAND EFFECTIVE
DATE") and (iii) use its reasonable best efforts to cause the Demand
Registration Statement to remain effective until the earlier of (x) one hundred
eighty (180) days of the Demand Effective Date and (y) the date on which all of
the Restricted Stock covered by the Demand Registration Statement has been sold
to the public pursuant to such registration statement in accordance with the
intended method of distribution thereof. Other than shares offered for its own
account pursuant to Section 2(d)(iii), the Company shall not permit any
securities other than Restricted Stock to be included in the Demand
Registration Statement.
(d) Notwithstanding anything in this Section 2 to the contrary:
(i) in no event will the Shareholders be entitled to request the
Company to amend the Shelf Registration Statement to permit an underwritten
offering of Restricted Stock pursuant to the Shelf Registration Statement or
request the Company file a Demand Registration Statement unless no less than
ten percent (10%) of the aggregate number of shares of Restricted Stock
originally held by the Shareholders are proposed to be sold pursuant to such
underwritten offering;
(ii) in no event will the Shareholders be entitled to request
the Company to amend the Shelf Registration Statement to permit or to file a
Demand Registration Statement for more than an aggregate of three (3)
underwritten offerings;
(iii) subject to Section 2(g), the Company shall have the right
to offer shares for its own account in the third such underwritten offering, if
any, pursuant to this Section 2 following the first two (2) such underwritten
offerings; and
(iv) the Company's obligation to register for resale the
Restricted Stock held by any Shareholder in any Registration Statement pursuant
to this Section 2 shall be contingent on such Shareholder furnishing to the
Company the information required by Section 4(c).
(e) the Company's obligation to amend the Shelf Registration
Statement to permit or to file a Demand Registration Statement for an
underwritten offering pursuant to this Section 2 shall not be deemed to have
been satisfied unless the Shelf Registration Statement or Demand Registration
Statement, as applicable, has become effective and remained effective in
3
compliance with the provisions of the Securities Act until such time as all of
the Restricted Stock offered in such underwritten offering shall have been
disposed of in accordance with the intended methods of disposition thereof set
forth in such Shelf Registration Statement or Demand Registration Statement, as
applicable.
(f) In any underwritten offering pursuant to this Section 2, the
participating Shareholders holding a majority of the Restricted Stock proposed
to be sold in such offering shall have the right to select one managing
underwriter, and such managing underwriter shall be the sole managing
underwriter for any such offering; provided that if the Company offers shares
for its own account in any such underwritten offering pursuant to this Section
2 the Company shall also be entitled to select one managing underwriter, and
such underwriter, together with the underwriter selected by the participating
Shareholders, shall be the sole managing underwriters for any such offering.
The Company (together with the participating Shareholders) shall enter into an
underwriting agreement in customary form with the underwriter or underwriters
selected for such underwriting, as well as all other documents customary in
similar offerings, including, without limitation, questionnaires, custody
agreements, powers of attorney, lockup agreements and indemnification
agreements, as applicable.
(g) With respect to the third underwritten offering, if any,
pursuant to this Section 2 following the first two (2) such underwritten
offerings, if the Company exercises its right to offer shares for its own
account in such offering and the managing underwriter(s) for such underwritten
offering advises the Company and the participating Shareholders in writing
that, in such underwriter(s) opinion, the aggregate number of securities
requested to be included in such offering by the Company, if any, and the
Shareholders exceeds the largest number or amount of securities which can be
sold without reasonably expecting to have an adverse effect on such offering,
including the price at which such securities can be sold, the number of such
securities to be included in such registration shall be reduced and the Company
and the participating Shareholders shall include in such offering the number of
securities that in the opinion of the managing underwriter(s) can be sold
without adverse effect on the offering, allocated pro rata among the Company
and the participating Shareholders of the Restricted Stock on the basis of the
number of shares proposed to be sold by the Company and such participating
Shareholders in such underwritten offering. If any Shareholder advises the
managing underwriter(s) of any underwritten offering that the shares of
Restricted Stock covered by the registration statement cannot be sold in such
offering within a price range acceptable to such Shareholder, then such
Shareholder shall have the right to exclude its Restricted Stock from such
offering.
3. INCIDENTAL REGISTRATION.
(a) If the Company at any time (other than pursuant to Section 2)
proposes to register any of its Common Stock under the Securities Act for sale
to the public, whether for its own account or for the account of other security
holders or both (except with respect to Registration Statements on Forms S-4,
S-8 or another form not available for registering the Restricted Stock for sale
to the public or any successor thereto), each such time it will give prompt
written notice to all holders of outstanding shares of Restricted Stock of its
intention to do so and of such holders' rights under this Section 3, at least
ten (10) business days prior to the anticipated filing date of the registration
statement relating to such registration. Upon the written request of any such
holder, received by the Company within five (5) business days after receipt of
the
4
the Company's notice by the holder, to register any of its Restricted Stock,
the Company will use reasonable best efforts to cause the Restricted Stock as
to which registration shall have been so requested to be included in the
securities to be covered by the Registration Statement proposed to be filed by
the Company. Any such Shareholder may elect, in writing no less than five (5)
business days prior to the anticipated effective date of the registration
statement filed in connection with such registration, not to register such
securities in connection with such registration.
(b) In the event that any registration pursuant to this Section 3
shall be, in whole or in part, an underwritten public offering of Common Stock,
the number of shares of Restricted Stock to be included in such an underwriting
may be reduced (pro rata among the requesting holders based upon the number of
shares of Restricted Stock owned by such holders) if and to the extent that the
managing underwriter notifies the Company in writing that, in its opinion, such
inclusion would exceed the largest number or amount of securities which can be
sold without reasonably expecting to have an adverse effect on such offering,
including the price at which such securities can be sold by the Company
therein. The reduction referred to in the immediately preceding sentence shall
be applied as follows: (i) if the Company effects such registration for its
account, the reduction shall be applied first, to the securities of security
holders of the Company (including the holders of the Restricted Stock) that are
entitled to, and are requested to be included in, such registration, pro rata
among all such security holders, based on the number of securities held by such
security holders, and second, to the securities included in such registration
by the Company, provided, however, that if the time period set forth in Section
2(a) has expired without a Registration Statement pursuant to Section 2 having
been filed, the above described order shall be reversed and (ii) if the Company
effects such registration for the account of other security holders, the
reduction shall be applied first, to the securities included in such
registration by the Company, second, to the securities of security holders of
the Company (including the holders of the Restricted Stock) which are entitled
to, and are requested to be included in, such registration pursuant to this
Section 3 and similar piggy-back registration rights, pro rata among all such
security holders, based on the number of securities held by such security
holders, and third, to the securities included in such registration by the
security holders of the Company initiating such registration. Notwithstanding
the foregoing provisions, the Company may withdraw any Registration Statement
referred to in this Section 3 without thereby incurring any liability to the
holders of Restricted Stock.
(c) In any underwritten offering pursuant to this Section 3 in
which no less than ten percent (10%) of the aggregate number of shares of
Restricted Stock originally held by the Shareholders are proposed to be sold,
the participating Shareholders and the Company shall each have the right to
select one managing underwriter and such managing underwriters shall be the
sole managing underwriters for any such offering. The Company (together with
the participating Shareholders) shall enter into an underwriting agreement in
customary form with the underwriter or underwriters selected for such
underwriting, as well as all other documents customary in similar offerings,
including, without limitation, questionnaires, custody agreements, powers of
attorney, lockup agreements and indemnification agreements, as applicable. The
participating Shareholders shall have no right to select a managing underwriter
if less than ten percent (10%) of the aggregate number of shares of Restricted
Stock originally held by the Shareholders are proposed to be sold in such
underwritten public offering.
5
4. REGISTRATION PROCEDURES.
(a) If and whenever the Company is required by the provisions of
Sections 2 or 3 to use reasonable best efforts to effect the registration of
any shares of Restricted Stock under the Securities Act, the Company will, as
expeditiously as reasonably practicable:
(i) prepare and file with the Commission a Registration
Statement with respect to such securities and use commercially reasonable best
efforts to cause such Registration Statement to become and remain effective for
the period of the distribution contemplated by Section 4(b);
(ii) prepare and file with the Commission such amendments and
supplements to such Registration Statement and the prospectus used in
connection therewith as may be necessary to keep such Registration Statement
effective for the period specified by Section 4(b) and comply with the
provisions of the Securities Act with respect to the disposition of all
Restricted Stock covered by such Registration Statement in accordance with the
sellers' intended method of disposition set forth in such Registration
Statement for such period;
(iii) furnish to each seller of Restricted Stock and to each
underwriter such number of copies of the Registration Statement and the
prospectus included therein (including each preliminary prospectus), copies of
any correspondence with the Commission or its staff relating to such
Registration Statement and such other documents as such persons reasonably may
request in order to facilitate the public sale or other disposition of the
Restricted Stock covered by such Registration Statement;
(iv) use reasonable best efforts to register or qualify the
Restricted Stock covered by such Registration Statement under the State Acts of
such jurisdictions as the sellers of Restricted Stock or, in the case of an
underwritten public offering, the managing underwriter reasonably shall
request; provided, however, that the Company shall not for any such purpose be
required to qualify generally to transact business as a foreign corporation in
any jurisdiction where it is not so qualified or to consent to general service
of process in any such jurisdiction;
(v) use reasonable best efforts to list the Restricted Stock
covered by such Registration Statement with a national securities exchange (if
such shares are not already listed) and with each additional securities
exchange on which the similar securities of the Company are then listed;
(vi) immediately notify each seller of Restricted Stock and
each underwriter under such Registration Statement, at any time when a
prospectus relating thereto is required to be delivered under the Securities
Act, of the happening of any event of which the Company has knowledge as a
result of which the prospectus contained in such Registration Statement, as
then in effect, includes an untrue statement of a material fact or omits to
state a material fact required to be stated therein or necessary to make the
statements therein not misleading in light of the circumstances then existing
and, with the assistance of such seller, the Company will prepare a supplement
or amendment to such prospectus so that, as thereafter delivered to the
purchasers of such Restricted Stock, such prospectus will not contain an untrue
6
statement of a material fact or omit to state any fact necessary to make the
statements therein, in light of the circumstances under which they were made,
not misleading;
(vii) if the offering is underwritten and at the request of any
seller of Restricted Stock, use reasonable best efforts to furnish on the date
that Restricted Stock is delivered to the underwriters for sale pursuant to
such registration: (A) an opinion dated such date of counsel representing the
Company for the purposes of such registration, addressed to the underwriters,
stating that such Registration Statement has become effective under the
Securities Act and that (1) to the knowledge of such counsel, no stop order
suspending the effectiveness thereof has been issued and no proceedings for
that purpose have been instituted or are pending or contemplated under the
Securities Act, (2) the Registration Statement, the related prospectus and each
amendment or supplement thereof comply as to form in all material respects with
the requirements of the Securities Act (except that such counsel need not
express any opinion as to financial statements contained therein), and (3) to
such other matters as reasonably may be requested by counsel for the
underwriters and (B) a letter dated such date from the independent public
accountants retained by the Company, addressed to the underwriters, stating
that they are independent public accountants within the meaning of the
Securities Act and that, in the opinion of such accountants, the financial
statements of the Company included in the Registration Statement or the
prospectus, or any amendment or supplement thereof, comply as to form in all
material respects with the applicable accounting requirements of the Securities
Act, and such letter shall additionally cover such other financial matters
(including information as to the period ending no more than five business days
prior to the date of such letter) with respect to such registration as such
underwriters reasonably may request;
(viii) make available for inspection by each seller of
Restricted Stock, any underwriter participating in any distribution pursuant to
such Registration Statement, and any attorney, accountant or other agent
retained by such seller or underwriter, all financial and other records,
pertinent corporate documents and properties of the Company, and cause the
Company's officers, directors and employees to supply all information
reasonably requested by any such seller, underwriter, attorney, accountant or
agent in connection with such Registration Statement;
(ix) after the filing of the Registration Statement and any
amendment or supplement thereto, the Company will promptly notify each selling
holder of Restricted Stock covered by such Registration Statement and any
amendment or supplement thereto of any order suspending the effectiveness of
such Registration Statement issued or threatened by the Commission and, as
promptly as practicable, use its commercially reasonable best efforts to
prevent the entry of such stop order or to remove it if entered;
(x) cooperate with the Shareholders and the managing
underwriters, if any, to facilitate the timely preparation and delivery of
certificates representing Restricted Stock to be sold and not bearing any
restrictive legends; and enable such Restricted Stock to be in such
denominations and registered in such names as the managing underwriters may
request prior to any sale of the Restricted Stock to the underwriters;
(xi) with respect to an underwritten offering pursuant to
this Agreement, make appropriate members of senior management of the
Company available (subject to consulting
7
with them in advance as to schedule) for customary participation in telephonic,
in-person conferences or "road show" presentations to potential investors;
(xii) promptly notify the Shareholders, counsel to the
Shareholders and the managing underwriter or agent, (i) when the registration
statement, or any post-effective amendment to the registration statement, shall
have become effective, or any supplement to the prospectus or any amendment to
the prospectus shall have been filed, (ii) of the receipt of any comments from
the Commission, and (iii) of any request of the Commission to amend the
registration statement or amend or supplement the prospectus or for additional
information; and
(xiii) otherwise use its reasonable best efforts to comply with
all applicable rules and regulations of the Commission, and make available to
its security holders, within the required time periods, an earnings statement
covering a period of at least twelve (12) months, beginning with the first
fiscal quarter of the Company after the effective date of the registration
statement (as the term "effective date" is defined in Rule 158(c) under the
Securities Act), which earnings statement shall satisfy the provisions of
Section 11(a) of the Securities Act and Rule 158 thereunder or any successor
provisions thereto.
(b) For purposes of Sections 4(a)(i) and (ii) and Section 2, the
period of distribution of Restricted Stock in a firm commitment underwritten
public offering shall be deemed to extend until each underwriter has completed
the distribution of all securities purchased by it or a period of one hundred
eighty (180) days, which ever first occurs, and the period of distribution of
Restricted Stock in any other registration shall be deemed to extend until the
earlier of the sale of all Restricted Stock covered thereby or of one hundred
eighty (180) days after the effective date thereof.
(c) In connection with each registration hereunder, the sellers of
Restricted Stock will furnish to the Company in writing such information with
respect to themselves, their beneficial ownership of Common Stock, and the
proposed distribution by them as reasonably shall be necessary in order to
assure compliance with federal securities laws, Commission rules and applicable
State Acts. The Company's obligation to register the Restricted Stock held by
any Shareholder in any Registration Statement shall be contingent on such
Shareholder furnishing to the Company the information required by this Section
4(c). Moreover, no person may participate in any underwritten offering
hereunder unless such person (i) provides the information required by this
Section 4(c); (ii) agrees to sell such person's securities on the basis
provided in any underwriting arrangements approved by the Company or the
participating Shareholders, as applicable; and (iii) completes and executes all
questionnaires, custody agreements, powers of attorney, lockup agreements,
indemnification agreements, underwriting agreements and other documents
reasonably required under the terms of such underwriting arrangements.
(d) In connection with each registration pursuant to Sections
2 or 3 covering an underwritten public offering, the Company and each selling
Shareholder shall (i) enter into a written agreement with the managing
underwriter(s) selected in the manner herein provided in such form and
containing such provisions as are customary in the securities business for
such an arrangement between such underwriter and companies of the Company's
size and investment stature, (ii) regardless of whether the agreement
referred to in the foregoing clause (i) is entered into, make such
representations and warranties to the selling Shareholders and each of the
8
underwriters in form, substance and scope as are customarily made in connection
with an offering pursuant to any appropriate agreement or such Registration
Statement, (iii) deliver such documents and certificates, including officers'
certificates, as may be customary in the circumstances and reasonably requested
by the selling Shareholders or the underwriters, (iv) undertake such
obligations relating to expense reimbursement, indemnification and contribution
as are provided in Sections 6 and 7 and (v) take such other actions as are
reasonably required in order to expedite or facilitate the disposition of such
Restricted Stock.
5. SUSPENSION OR DELAY. Notwithstanding anything to the contrary in
this Agreement, the Company may delay filing a Registration Statement or an
amendment thereto, and may withhold efforts to cause a Registration Statement
or amendment thereto to become effective if: (i) the board of directors of the
Company determines in good faith after consultation with counsel that such
action is required by applicable law; (ii) the Company determines in good faith
after consultation with counsel that the filing or use of the Registration
Statement or amendment thereto would require the Company to disclose material
information, including without limitation the fact that the Company is engaged
in confidential negotiations regarding, or is in the process of completing, any
significant business transaction, the disclosure of which would not be required
in the absence of such registration statement, and the board of directors of
the Company determines in good faith that such disclosure would be materially
detrimental to the Company and its stockholders; or (iii) the Company is
engaged in, or prior to receiving such request had determined and taken
substantial steps to effect, an underwritten public offering of Common Stock
for its own account (other than an offering pursuant to Form S-8, S-4 or any
successor or similar form) and the managing underwriter has advised the Company
that such offers and sales by the Shareholders will adversely affect such
public offering. Each period referred to above during which the use of a
Registration Statement or amendment thereto is delayed in accordance with this
Section 5 shall be referred to herein as a "DEFERRAL PERIOD". Notwithstanding
the foregoing, in no event shall the Company be entitled to declare more than
three (3) Deferral Periods in any 365-day period nor shall the aggregate number
of days included in all Deferral Periods exceed one hundred fifty (150) days in
any 365-day period without the consent of the Shareholders holding a majority
of the Restricted Stock at such time. The Company shall terminate a Deferral
Period as soon as practicable after the circumstances giving rise to the
Company's right to declare such Deferral Period cease to exist. The Company
shall promptly give the Shareholders written notice of a determination to
commence a Deferral Period, which notice shall contain a general statement of
the reasons for such Deferral Period and the anticipated length of such
Deferral Period, and shall notify the Shareholders upon the termination of each
Deferral Period. If, after a Registration Statement becomes effective, the
Company advises the holders of registered shares that the Company has
determined in good faith that the registration statement is required to be
amended to comply with applicable law or regulation, the holders of such
registered shares shall suspend any further sales of their registered shares
until the Company advises them that the registration statement has been
amended.
6. EXPENSES. All expenses incurred by the Company and the selling
holders of Restricted Stock in complying with Sections 2 and 3, including,
without limitation, all registration and filing and review fees, printing
expenses, fees and disbursements of counsel (including one counsel to the
holders of Restricted Stock) and independent public accountants for the
Company, fees and expenses (including counsel fees) incurred in connection
with complying with State Acts,
9
fees of the National Association of Securities Dealers, Inc. (the "NASD"),
fees of any securities exchange, transfer taxes, fees of transfer agents and
registrars, costs of insurance, messenger, telephone and delivery expenses
and reasonable fees and disbursements of one counsel for the sellers of
Restricted Stock, but excluding any Selling Expenses, are called
"REGISTRATION EXPENSES." Registration Expenses shall not include underwriting
discounts, selling commissions, fees and expenses of more than one counsel to
the selling holders of Restricted Stock and all such fees and expenses are
referred to as "SELLING EXPENSES." The Company will pay all Registration
Expenses in connection with the Shelf Registration Statement, the Demand
Registration Statement and each Registration Statement under Sections 2 or 3
of this Agreement. All Selling Expenses in connection with each Registration
Statement under Sections 2 and 3 shall be borne by the participating
Shareholders in proportion to the number of shares of Restricted Stock sold
by each, or by such participating Shareholders other than the Company (except
to the extent the Company shall be a seller) as they may agree.
7. INDEMNIFICATION AND CONTRIBUTION.
(a) In the event of a registration of any of the Restricted Stock
under the Securities Act pursuant to Sections 2 or 3, the Company will
indemnify and hold harmless each seller of such Restricted Stock thereunder,
each underwriter of such Restricted Stock thereunder and each other person, if
any, who controls such seller or underwriter within the meaning of the
Securities Act, against any losses, claims, damages or liabilities (including,
without limitation, any legal or other expenses reasonably incurred by such
Shareholder or any such controlling person in connection with defending or
investigating any such action or claim), joint or several, to which such
seller, underwriter or controlling person may become subject under the
Securities Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon any
untrue statement or alleged untrue statement of any material fact contained in
any Registration Statement under which such Restricted Stock was registered
under the Securities Act pursuant to Sections 2 or 3, any preliminary
prospectus or final prospectus contained therein, or any amendment or
supplement thereof, or arise out of or are based upon the omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, and will reimburse
each such seller, each such underwriter and each such controlling person for
any legal or other expenses reasonably incurred by them in connection with
investigating or defending any such loss, claim, damage, liability or action,
provided, however, that the Company will not be liable in any such case if and
to the extent that any such loss, claim, damage or liability arises out of or
is based upon an untrue statement or alleged untrue statement or omission or
alleged omission so made in conformity with information furnished by any such
seller, any such underwriter or any such controlling person in writing
specifically for use in such Registration Statement or prospectus. It is agreed
that the indemnity agreement contained in this Section 7 shall not apply to
amounts paid in settlement of any such loss, claim, damage, liability or action
if such settlement is effected without the consent of the Company (which
consent shall not be unreasonably withheld or delayed).
(b) As a condition precedent to the right of any holder of
Restricted Stock to sell Restricted Stock in a registration pursuant to this
Agreement, such holder will agree that in the event of a registration of any
of the Restricted Stock under the Securities Act pursuant to Sections 2 or 3,
each seller of such Restricted Stock thereunder, severally and not jointly,
will indemnify and
10
hold harmless the Company, each person, if any, who controls the Company
within the meaning of the Securities Act, each officer of the Company who
signs the Registration Statement, each director of the Company, each
underwriter and each person who controls any underwriter within the meaning
of the Securities Act, against all losses, claims, damages or liabilities,
joint or several, to which the Company or such officer, director, underwriter
or controlling person may become subject under the Securities Act or
otherwise, insofar as such losses, claims, damages or liabilities (or actions
in respect thereof) arise out of or are based upon any untrue statement or
alleged untrue statement of any material fact contained in the Registration
Statement under which such Restricted Stock was registered under the
Securities Act pursuant to Sections 2 or 3, any preliminary prospectus or
final prospectus contained therein, or any amendment or supplement thereof,
or arise out of or are based upon the omission or alleged omission to state
therein a material fact required to be stated therein or necessary to make
the statements therein not misleading, and will reimburse the Company and
each such officer, director, underwriter and controlling person for any legal
or other expenses reasonably incurred by them in connection with
investigating or defending any such loss, claim, damage, liability or action,
provided, however, that such seller will be liable hereunder in any such case
if and only to the extent that any such loss, claim, damage or liability
arises out of or is based upon an untrue statement or alleged untrue
statement or omission or alleged omission made in reliance upon and in
conformity with information pertaining to such seller, as such, furnished in
writing to the Company by such seller specifically for use in such
Registration Statement or prospectus, and provided, further, however, that
the liability of each seller hereunder shall not in any event to exceed the
net proceeds received by such seller from the sale of Restricted Stock
covered by such Registration Statement. It is agreed that the indemnity
agreement contained in this Section 7(b) shall not apply to amounts paid in
settlement of any such loss, claim, damage, liability or action if such
settlement is effected without the consent of such seller hereunder (which
consent shall not be unreasonably withheld or delayed).
(c) Promptly after receipt by an indemnified party hereunder of
notice of the commencement of any action, such indemnified party shall, if a
claim in respect thereof is to be made against the indemnifying party
hereunder, notify the indemnifying party in writing thereof, but the omission
so to notify the indemnifying party shall not relieve it from any liability
which it may have to such indemnified party other than under this Section 7
and shall only relieve it from any liability which it may have to such
indemnified party under this Section 7 if and to the extent the indemnifying
party is prejudiced by such omission. In case any such action shall be
brought against any indemnified party and it shall notify the indemnifying
party of the commencement thereof, the indemnifying party shall be entitled
to participate in and, to the extent it shall wish, to assume and undertake
the defense thereof with counsel reasonably satisfactory to such indemnified
party, and, after notice from the indemnifying party to such indemnified
party of its election so to assume and undertake the defense thereof, the
indemnifying party shall not be liable to such indemnified party under this
Section 7 for any legal expenses subsequently incurred by such indemnified
party in connection with the defense thereof other than reasonable costs of
investigation and of liaison with counsel so selected, provided, however,
that, if the defendants in any such action include both the indemnified party
and the indemnifying party and the indemnified party shall have reasonably
concluded that there may be reasonable defenses available to it which are
different from or additional to those available to the indemnifying party or
if the interests of the indemnified party reasonably may be deemed to
conflict with the interests of the indemnifying party, the indemnified party
shall have the right to select a separate counsel and to assume such
11
legal defenses and otherwise to participate in the defense of such action,
with the expenses and fees of such separate counsel and other expenses
related to such participation to be reimbursed by the indemnifying party as
incurred.
(d) In order to provide for just and equitable contribution to
joint liability under the Securities Act in any case in which either (i) any
holder of Restricted Stock exercising rights under this Agreement, or any
controlling person of any such holder, makes a claim for indemnification
pursuant to this Section 7 but it is judicially determined (by the entry of a
final judgment or decree by a court of competent jurisdiction and the
expiration of time to appeal or the denial of the last right of appeal) that
such indemnification may not be enforced in such case notwithstanding the fact
that this Section 7 provides for indemnification in such case, or (ii)
contribution under the Securities Act may be required on the part of any such
selling holder or any such controlling person in circumstances for which
indemnification is provided under this Section 7; then, and in each such case,
the Company and such holder will contribute to the aggregate losses, claims,
damages or liabilities to which they may be subject (after contribution from
others) in such proportion so as to reflect the relative fault of each
indemnifying party; provided, however, that, in any such case, (A) no such
holder will be required to contribute any amount in excess of the public
offering price of all such Restricted Stock (net of Selling Expenses) offered
by it pursuant to such Registration Statement; and (B) no person or entity
guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of
the Securities Act) will be entitled to contribution from any person or entity
who was not guilty of such fraudulent misrepresentation. The relative fault of
the Company, on the one hand, and of each selling shareholder, on the other,
shall be determined by reference to, among other things, whether the untrue or
alleged untrue statement of a material fact or the omission to state a material
fact relates to information supplied by such party, and the parties' relative
intent, knowledge, access to information and opportunity to correct or prevent
such statement or omission. The Company and each Shareholder agree that it
would not be just or equitable if contribution pursuant to this Section 7 were
determined by pro rata allocation or by any other method of allocation that
does not take account of the equitable considerations referred to above. The
amount paid or payable as a result of the losses, claims, damages and
liabilities referred to above shall be deemed to include, subject to the
limitations set forth above, any legal or other expenses reasonably incurred by
such indemnified party in connection with investigating or defending any such
action or claim.
(e) The indemnity and contribution provisions contained in this
Section 7 shall remain operative and in full force and effect regardless of (i)
any termination of this Agreement, (ii) any investigation made by or on behalf
of any Shareholder or any person controlling any Shareholder, or by or on
behalf of the Company, its officers or directors or any person controlling the
Company, and (iii) any sale of Restricted Stock pursuant to any Registration
Statement.
(f) The obligations of the parties under this Section 7 shall be in
addition to any liability which any party may otherwise have to any other
party.
(g) The indemnification and contribution required by Sections 7(a),
7(b) and 7(d) shall be made by periodic payments of the amount thereof during
the course of the investigation or defense, as and when bills are received or
expense, loss, damage or liability is incurred.
12
8. CHANGES IN COMMON STOCK. If there is any change in the Shares by
way of a stock split, stock dividend, combination or reclassification, or
through a merger, consolidation, reorganization or recapitalization, or by any
other means, appropriate adjustment shall be made in the provisions hereof so
that the rights and privileges granted hereby shall continue with respect to
the Shares as so changed.
9. RULE 144 REPORTING AND TERMINATION OF COMPANY OBLIGATIONS.
(a) The Company shall not be obligated to register or include in
any Registration Statement any Restricted Stock held by a Shareholder if all
Restricted Stock held by such Shareholder may be publicly offered, sold and
distributed without registration pursuant to Rule 144(k) under the Securities
Act.
(b) With a view to making available the benefits of certain rules
and regulations of the Commission which may at any time permit the sale of the
Restricted Stock to the public without registration, the Company shall:
(i) make and keep public information available, as those terms
are understood and defined in Rule 144 under the Securities Act;
(ii) use reasonable best efforts to file with the Commission in
a timely manner all reports and other documents required of the Company under
the Securities Act and the Exchange Act; and
(iii) furnish to each holder of Restricted Stock forthwith upon
request a written statement by the Company as to its compliance with the
reporting requirements of such Rule 144 and of the Securities Act and the
Exchange Act, a copy of the most recent annual or quarterly report of the
Company, and such other reports and documents so filed by the Company as such
holder may reasonably request in availing itself of any rule or regulation of
the Commission allowing such holder to sell any Restricted Stock without
registration.
(c) The Company shall take such further action and shall offer
all reasonable and necessary assistance including, without limitation, the
delivery of a legal opinion letter and instructions to the Company's stock
transfer agent to enable the sale by any Shareholder of Restricted Stock
pursuant to Rule 144 or any similar rule or regulation.
10. LOCKUP AGREEMENTS.
(a) In consideration of the Company's obligations under this
Agreement, each of the Shareholders hereby agrees that in no event shall such
Shareholder sell, assign, convey, exchange, pledge, hypothecate, gift, dispose
of or otherwise part with any indicia or aspect of title, ownership or
possession of, to or in (collectively, a "TRANSFER") (i) any such Shares during
the period ending twelve (12) months after the Effective Time (as defined in
the Merger Agreement) or (ii) in the aggregate more than fifty percent (50%) of
such Shares held by such Shareholder during the period ending eighteen (18)
months after the Effective Time.
13
(b) Notwithstanding the restrictions in Section 10(a), unless
prohibited by applicable securities laws, a Shareholder shall be permitted to
effect a Transfer of Shares to an Affiliate of such Shareholder or, if the
Shareholder is a limited liability company, limited partnership, corporation or
trust, to its members, partners, shareholders or beneficiaries, as applicable.
Any such purported Transfer shall be void and of no force unless the
Shareholder shall provide written notice of the proposed Transfer to the
Company no less than ten (10) days prior to the completion thereof and shall
provide the Company with all certificates, affidavits, representations or other
documents reasonably necessary to effectuate such proposed transfer under
federal, state or other applicable securities laws. For purposes of this
Agreement, the term "AFFILIATE" means, with respect to any Shareholder, any
person who directly or indirectly, through one or more intermediaries,
controls, is controlled by, or is under common control with, such Shareholder,
and the term "control" means the possession, directly or indirectly, of the
power to direct or cause the direction of the management and policies of a
person, whether through the ownership of voting securities, by contract or
otherwise, and the terms "controlled" and "controlling" have meanings
correlative thereto.
11. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company
represents and warrants as follows:
(a) the execution, delivery and performance of this Agreement by
the Company has been duly authorized by all requisite corporate action and will
not violate any order of any court or other agency of government, the Articles
of Incorporation or bylaws of the Company or any provision of any indenture,
agreement or other instrument to which it or any or its properties or assets is
bound, conflict with, result in a breach of or constitute (with due notice or
lapse of time or both) a default under any such indenture, agreement or other
instrument or result in the creation or imposition of any lien, charge or
encumbrance of any nature whatsoever upon any of the properties or assets of
the Company; and
(b) this Agreement has been duly executed and delivered by the
Company and constitutes the legal, valid and binding obligation of the Company,
enforceable in accordance with its terms.
12. MISCELLANEOUS.
(a) Successors and Assigns. All covenants and agreements contained
in this Agreement by or on behalf of any of the parties hereto shall bind and
inure to the benefit of the respective successors and assigns of the parties
and intended third party beneficiaries (as described in Section 12(d)) hereto
(including without limitation, any transferees of any Restricted Stock),
whether so expressed or not.
(b) No Inconsistent Agreements. The Company hereby represents and
warrants that the rights granted to the Shareholders hereunder do not conflict
in any way with rights granted to other holders of the Company's securities. In
addition, the Company covenants and agrees that it shall not at any time during
the term of this Agreement grant any holder of Company securities any rights
that conflict in any way with rights granted to the Shareholders hereunder.
14
(c) Third Party Beneficiaries. Any transferee of Restricted Stock
is an intended third party beneficiary of this Agreement.
(d) Notices. All notices, requests, consents and other
communications hereunder shall be in writing and shall be delivered in person
or by recognized overnight courier, mailed by certified or registered mail,
return receipt requested, or sent by telecopier, addressed as follows:
(i) if to the Company at the address of such party set forth in
the Merger Agreement;
(ii) if to any Shareholder at the address set forth on Schedule
1 or such other address as may be furnished to the Company by such Shareholder;
and
(iii) if to any subsequent holder of Restricted Stock, to it at
such address as may have been furnished to the Company in writing by such
holder;
or, in any case, at such other address or addresses as shall have been
furnished in writing to the Company (in the case of a holder of Restricted
Stock) or to the holders of Restricted Stock (in the case of the Company) in
accordance with the provisions of this paragraph.
(e) Governing Law, Consent to Jurisdiction. This Agreement shall be
governed by and construed in accordance with the Laws of the State of New York,
without giving effect to any Laws of such State that would make such choice of
Laws ineffective. Each Party hereto hereby submits to the non-exclusive
jurisdiction of the United States District Court for the Southern District of
New York and of any New York State Court sitting in Manhattan for purposes of
all legal proceedings arising out of or relating to this Agreement or the
transactions contemplated hereby. Each Party hereto irrevocably waives, to the
fullest extent permitted by Law, any objection which it may now or hereafter
have to the laying of the venue of any such proceeding brought in such a court
and any claim that any such proceeding brought in such a court has been brought
in an inconvenient forum.
(f) MUTUAL WAIVER OF JURY TRIAL. THE PARTIES HERETO WAIVE ALL RIGHT
TO TRIAL BY JURY IN ANY ACTION, SUIT OR PROCEEDING BROUGHT TO ENFORCE OR DEFEND
ANY RIGHTS OR REMEDIES UNDER THIS AGREEMENT.
(g) Amendment and Waiver. This Agreement may not be amended or
modified, and no provision hereof may be waived, without the written consent of
the Company and the holders of at least a majority of the outstanding shares of
Restricted Stock at the time of such amendment, modification or waiver.
(h) Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original but all of which
together will constitute one and the same instrument.
(i) Severability. Any term or provision of this Agreement that is
invalid or unenforceable in any situation in any jurisdiction shall not affect
the validity or enforceability of
15
the remaining terms and provisions hereof or the validity or enforceability
of the offending term or provision in any other situation or in any other
jurisdiction. Upon any such determination that any term or other provision is
invalid, illegal or incapable of being enforced, the parties hereto will
negotiate in good faith to modify this Agreement so as to effect the original
intent of the parties as closely as possible in an acceptable manner to the
end that the obligations and restrictions contemplated by this Agreement are
consummated to the extent possible.
(j) Consummation of Merger. This Agreement shall be null and void
and given no effect if the Merger Agreement is terminated and the transactions
contemplated thereby are not consummated.
(k) Headings. The headings and captions contained herein are for
convenience of reference only and shall not control or affect the meaning or
construction of any provision hereof.
(SIGNATURES COMMENCE ON THE FOLLOWING PAGE)
16
IN WITNESS WHEREOF, the undersigned have executed this Agreement as
of the day and year indicated.
COMPANY:
RAYOVAC CORPORATION
By: /s/ Kent J. Hussey
----------------------------------------
Title: President and Chief Operating Officer
Date: February 7, 2005
SHAREHOLDER:
[SEE SCHEDULE 1]
17
SCHEDULE 1
SHAREHOLDERS
Banc of America Capital Investors L.P.
Robert G. Buck
Candace Pratt Cady Revocable Trust
Robert L. Caulk
Kent J. Davies
Louis D. Dworsky, Trustee under the Jones Irrevocable Children's Trust FBO
Jeffrey D. Jones 9/17/97
Louis D. Dworsky, Trustee under the Jones Irrevocable Children's Trust FBO
Leslie A. Jones 9/17/97
Louis D. Dworsky, Trustee under the Jones Irrevocable Children's Trust FBO
Benton A. Kindle 9/17/97
Louis D. Dworsky, Trustee under the Jones Irrevocable Children's Trust FBO
Brooke M. Kindle 9/17/97
Louis D. Dworsky, Trustee under the Jones Irrevocable Children's Trust FBO
Dana M. Smith 9/17/97
Ralph Edwards Revocable Trust
Mark B. Gershenson
John A. Heil
John F. Howe
Daniel J. Johnston
David Jones
Thomas Kasvin
Bryan A. Krebs & Joan Krebs
Louis N. Laderman
Gary D. Leeman
John McGreevy
William H. Metzger
Sandor H. Neuman
Joseph Pitassi
Andrew Ponte
Bank of America, agent for Arthur H. Pratt
Mark D. Rowland
Robert S. Rubin
Brian S. Schultz
DJS Investment Group, L.P.
SDS Investment Group, L.P.
Gary VanHeerwarden
Glenn M. Whiteacre
Thomas H. Lee Equity Fund IV, L.P.
Thomas H. Lee Foreign Fund IV, L.P.
Thomas H. Lee Foreign Fund IV-B, L.P.
1997 Thomas H. Lee Nominee Trust
David V. Harkins
The 1995 Harkins Gift Trust
Scott A. Schoen
C. Hunter Boll
Scott M. Sperling
Anthony J. DiNovi
Thomas M. Hagerty
Warren C. Smith, Jr.
Smith Family Limited Partnership
Seth W. Lawry
Kent R. Weldon
Terrence M. Mullen
Todd M. Abrecht
Charles A. Brizius
Scott Jaeckel
Soren Oberg
Thomas R. Sheperd
Wendy L. Masler
Andrew D. Flaster
Robert Schiff Lee 1998 Irrevocable Trust
Stephen Zachary Lee
Charles W. Robins as custodian for Jesse Lee
Charles W. Robins
James Westra
Thomas H. Lee Charitable Investment L.P.
Thomas H. Lee Investors Limited Partnership
EXHIBIT 10.7
STANDSTILL AGREEMENT
THIS STANDSTILL AGREEMENT (this "AGREEMENT") is entered into as of
February 7, 2005 (the "EFFECTIVE Date") by and between THOMAS H. LEE
EQUITY FUND IV, L.P., a Delaware limited partnership ("EQUITY FUND"), THL
EQUITY ADVISORS IV, LLC, a Delaware limited liability company ("EQUITY
ADVISORS"), THOMAS H. LEE PARTNERS, L.P., a Delaware limited partnership
("PARTNERS"), THOMAS H. LEE ADVISORS, L.L.C., a Delaware limited liability
company ("LEE"; together with Equity Fund, Equity Advisors and Partners,
the "RESTRICTED PARTIES"), and RAYOVAC CORPORATION, a Wisconsin corporation
(the "COMPANY"). The foregoing parties to this Agreement are each a "PARTY"
and collectively the "PARTIES". Capitalized terms not defined herein shall
have the meanings ascribed to such terms in the Merger Agreement (as
defined below).
BACKGROUND STATEMENT
Pursuant to that certain Agreement and Plan of Merger (the "MERGER
AGREEMENT") dated January 3, 2005 by and among the Company, Lindbergh
Corporation and United Industries Corporation, some or all of the
Restricted Parties will receive shares of the Company's $0.01 par value
common stock (the "COMMON STOCK"). The Company has required, as a material
inducement to its consummation of the transactions contemplated by the
Merger Agreement, that the Restricted Parties enter into this Agreement,
whereby the Restricted Parties agree to limit their future acquisitions of
the capital stock of the Company.
STATEMENT OF AGREEMENT
NOW, THEREFORE, in consideration of the mutual representations,
warranties, covenants and agreements contained herein, and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, and intending to be legally bound hereby, the Parties agree
as follows:
SECTION 1.
DEFINED TERMS
1.1 Defined Terms. As used in this Agreement the following terms shall
have the following meanings:
"AFFILIATE" means with respect to any Person, any other Person
that directly, or indirectly through one or more intermediaries, Controls
or is Controlled by, or is under common Control with, such Person.
Notwithstanding anything herein to the contrary, the term "Affiliate" shall
not be deemed to include any portfolio company of any Restricted Party or
Putnam Investments, Inc.
"COMPANY VOTING SECURITIES" means, collectively, the Common Stock,
any other class of capital stock of the Company issued and outstanding, and
any other securities, warrants or
1
options or rights of any nature (whether or not issued by the Company)
that are convertible into, exchangeable for, or exercisable for the purchase
of, or otherwise give the holder thereof any rights in respect of any class or
series of Company securities that is entitled to vote generally for the
election of directors.
"CONTROL" means, with respect to any Person, the possession,
direct or indirect, of the power to direct or cause the direction of the
management and policies of such Person, whether through the ownership of
voting securities, by contract or otherwise.
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as
amended.
"PERMITTED OWNERSHIP PERCENTAGE" means twenty-eight percent (28%)
of the Company Voting Securities on a fully-diluted basis, including no
more than twenty-eight percent (28%) of the shares of any class of such
Company Voting Securities on a fully-diluted basis.
"SECURITIES ACT" shall mean the Securities Act of 1933, as
amended, or any similar federal statute, and the rules and regulations of
the Commission thereunder, all as the same shall be in effect at the time.
"TRANSFER" means, as a noun, any transfer, sale, assignment,
exchange, charge, pledge, gift, hypothecation, conveyance, encumbrance or
other disposition whether direct or indirect, voluntary or involuntary, by
operation of Law or otherwise and, as a verb, directly or indirectly,
voluntarily or involuntarily, by operation of Law or otherwise, to
transfer, sell, assign, exchange, charge, pledge, give, hypothecate,
convey, encumber or otherwise dispose of.
SECTION 2.
REPRESENTATIONS AND WARRANTIES
Each of the Parties hereby represents and warrants with respect to
itself only that:
(a) it has the corporate or other organizational power and
authority to enter into this Agreement and to perform its obligations
hereunder;
(b) this Agreement constitutes its valid and legally binding
obligation, enforceable in accordance with the terms hereof except to
the extent that such enforceability may be limited by bankruptcy,
insolvency, reorganization, moratorium or other Laws and court
decisions relating to or affecting the enforceability of creditor's
rights generally (including statutory or other Laws regarding
fraudulent transfers), and is subject to general principles of equity;
(c) neither the execution and the delivery of this Agreement,
nor the consummation of the transactions contemplated hereby by it,
will (i) violate any Law, Governmental Order or other restriction of
any Governmental Entity, to which it is subject or any provision of
its articles of incorporation or formation, bylaws or other
2
organizational documents or (ii) conflict with, result in a
breach of, constitute a default under, result in the acceleration of,
create in any party thereto the right to accelerate, terminate,
modify, or cancel, or require any notice under any material agreement,
contract, lease, license, instrument or other material arrangement to
which it is a party or by which it is bound or to which any of its
material assets is subject (or result in the imposition of any lien,
security interest or other encumbrance upon any of its assets);
(d) it need not give any notice to, make any filing with, or
obtain any Authorization of any Person not already been obtained in
order to consummate the transactions contemplated by this Agreement;
and
(e) in the case of each of the Restricted Parties, except for
agreements expressly contemplated in, or entered into for the purpose
of consummating the transactions contemplated in, the Merger
Agreement, neither such Restricted Party nor any of its Affiliates has
any agreement, arrangement or understanding with any other Person or
group who is not an Affiliate of such Restricted Party with respect to
acquiring, holding, voting or disposing of Company Voting Securities.
SECTION 3.
STANDSTILL
3.1 Standstill Period. During the period commencing on the date
hereof and ending on the fifth (5th) anniversary of the Effective Date (the
"STANDSTILL PERIOD"), except as specifically approved in writing in advance
by the Board of Directors of the Company, the Restricted Parties shall not,
and shall cause any Affiliates to not, in any manner, directly or
indirectly, either individually or together with any Person or Persons
acting in concert of beneficial ownership (within the meaning of Rule 13d-3
of the Exchange Act):
(a) acquire, or offer or agree to acquire, or become the
beneficial owner of or obtain any rights in respect of any Company
Voting Securities such that, following the consummation of such
transaction, the Restricted Parties and their Affiliates taken
together would beneficially own, in the aggregate, Company Voting
Securities in excess of the Permitted Ownership Percentage;
provided, however that the foregoing limitation on acquisition
shall not prohibit the acquisition of Company Voting Securities
issued as dividends or as a result of stock splits and similar
reclassifications or received in a consolidation, merger or other
business combination in respect of, in exchange for or upon
conversion of Company Voting Securities validly acquired under
this Section 3 and held by the Restricted Parties or any of their
Affiliates at the time of such dividend, split or
reclassification, consolidation or merger or business combination;
(b) solicit proxies or consents or become a "participant" in
a "solicitation" (as such terms are defined or used in Regulation 14A
under the Exchange Act) of proxies or consents with respect to any
Company Voting Securities or initiate or become a participant in any
shareholder proposal or "election contest" (as such term is defined or
used in Rule 14a-11 under the Exchange Act) with respect to the
Company or any of its successors or induce others to initiate the
same, or otherwise seek to advise or influence
3
any Person with respect to the voting of any voting securities of the
Company or any of its successors;
(c) publicly or privately propose, encourage, solicit or
participate in the solicitation of any Person to acquire, offer to
acquire or agree to acquire, by merger, tender offer, purchase or
otherwise, the Company or a substantial portion of its assets or
more than 5% of the outstanding capital stock (except in
connection with the registration of securities pursuant to the
Registration Rights Agreement); or
(d) directly or indirectly join in or in any way participate
in a pooling agreement, syndicate, voting trust or other similar
arrangement with respect to the Company's voting securities or
otherwise act in concert with any other Person (other than Affiliates
of such Restricted Parties), for the purpose of acquiring, holding,
voting or disposing of the Company Voting Securities.
3.2 Limitation. Notwithstanding anything herein to the contrary,
the Restricted Parties will not be deemed to be in violation of this
Agreement if the Restricted Parties and their Affiliates taken together own
Company Voting Securities in excess of the Permitted Ownership Percentage
as a result or arising out of any action taken by the Company to reduce the
number of issued and outstanding shares of Company Voting Securities.
SECTION 4.
MISCELLANEOUS
4.1 Remedies. Each of the Parties acknowledges and agrees that (a)
the provisions of this Agreement are reasonable and necessary to protect
the proper and legitimate interests of the Parties and (b) the Parties
would be irreparably damaged in the event any of the provisions of this
Agreement were not performed in accordance with their specific terms or
were otherwise breached. It is accordingly agreed that each of the Parties
shall be entitled to preliminary and permanent injunctive relief to prevent
breaches of the provisions of this Agreement by any other Party without the
necessity of proving actual damages or of posting any bond, and to enforce
specifically the terms and provisions hereof and thereof in any court of
the United States or any state thereof having jurisdiction, which rights
shall be cumulative and in addition to any other remedy to which the
Parties may be entitled hereunder or at law or equity.
4.2 No Third-Party Beneficiaries. This Agreement shall not confer
any rights or remedies upon any Person other than the Parties, their
respective successors and permitted transferees and assigns.
4.3 Entire Agreement. This Agreement (including the documents
referred to herein) constitutes the entire agreement among the Parties with
respect to the subject matter hereof and supersedes any prior
understandings, agreements, or representations by or among the Parties,
written or oral, to the extent they relate in any way to the subject matter
hereof.
4.4 Succession and Assignment. This Agreement shall be binding
upon and inure to the benefit of the Parties and their respective
successors and permitted transferees and assigns. No
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Party may assign either this Agreement or any of its rights, interests or
obligations hereunder without the prior written approval of the other
Parties; provided, however that the Company may assign its rights and
obligations under this Agreement to any successor or acquiring entity in
connection with any business combination transaction, reorganization or
sale of substantially all the assets of the Company.
4.5 Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original but all of which
together will constitute one and the same instrument.
4.6 Governing Law. This agreement shall be governed by and construed
in accordance with the Laws of the State of New York, without giving effect to
any Laws of such State that would make such choice of Laws ineffective.
4.7 Amendments and Waivers. No amendment of any provision of this
Agreement shall be valid unless the same shall be in writing and signed by each
of the Parties. No waiver by any Party of any default, misrepresentation, or
breach of warranty or covenant hereunder, whether intentional or not, shall be
deemed to extend to any prior or subsequent default, misrepresentation, or
breach of warranty or covenant hereunder or affect in any way any rights
arising by virtue of any prior or subsequent such occurrence.
4.8 Severability. Any term or provision of this Agreement that is
invalid or unenforceable in any situation in any jurisdiction shall not affect
the validity or enforceability of the remaining terms and provisions hereof or
the validity or enforceability of the offending term or provision in any other
situation or in any other jurisdiction. Upon any such determination that any
term or other provision is invalid, illegal or incapable of being enforced, the
Parties hereto will negotiate in good faith to modify this Agreement so as to
effect the original intent of the Parties as closely as possible in an
acceptable manner to the end that the obligations and restrictions contemplated
by this Agreement are consummated to the extent possible.
4.9 Termination. This Agreement shall automatically terminate as of
the fifth (5th) anniversary of the Effective Date.
[signatures on next page]
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IN WITNESS WHEREOF, each of the Parties has executed this Agreement as
of the date first written above.
RAYOVAC CORPORATION
By: /s/ Kent J. Hussey
----------------------------
Name: Kent J. Hussey
Title: President and Chief
Operating Officer
THOMAS H. LEE EQUITY FUND IV, L.P.
By: THL Equity Advisors IV, LLC,
its General Partner
By: Thomas H. Lee Partners, L.P.,
its Managing Member
By: Thomas H. Lee Advisors, LLC,
its General Partner
By: /s/ Scott A. Schoen
----------------------------
Name: Scott A. Schoen
Title: Managing Director
THL EQUITY ADVISORS IV, LLC
By: Thomas H. Lee Partners, L.P.,
its Managing Member
By: Thomas H. Lee Advisors, LLC,
its General Partner
By: /s/ Scott A. Schoen
--------------------------
Name: Scott A. Schoen
Title: Managing Director
THOMAS H. LEE PARTNERS, L.P.
By: Thomas H. Lee Advisors L.L.C.,
its General Partner
By: /s/ Scott A. Schoen
--------------------------
Name: Scott A. Schoen
Title: Managing Director
THOMAS H. LEE ADVISORS, L.L.C.
By: /s/ Scott A. Schoen
----------------------------
Name: Scott A. Schoen
Title: Managing Director
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EXHIBIT 99.1
Rayovac Completes Acquisition of United Industries, Debt Tender Offer and
Related Financings
ATLANTA, Feb 07, 2005 /PRNewswire-FirstCall via COMTEX/ -- Rayovac Corp. (NYSE:
ROV), a global consumer products company with a diverse portfolio of
world-class brands, announced today that it has completed its acquisition of
United Industries Corporation. Rayovac further announced that, in connection
with that acquisition, Rayovac completed its offering of $700 million aggregate
principal amount of its 7 3/8% Senior Subordinated Notes due 2015 and its
tender offer for United Industries' 9 7/8% Senior Subordinated Notes due 2009,
retired United Industries' senior credit facilities and replaced Rayovac's
senior credit facilities with new senior credit facilities initially
aggregating $1.03 billion. Rayovac financed the cash portion of the purchase
price of the United Industries acquisition, the tender offer for United
Industries' 9 7/8% Senior Subordinated Notes due 2009 and the retirement of
United Industries' senior credit facilities with the proceeds from the offering
of its 7 3/8% Senior Subordinated Notes due 2015 and new senior credit
facilities.
As of 9:00 a.m., New York City time, on February 7, 2005, the expiration date
of Rayovac's tender offer for United Industries' 9 7/8% Senior Subordinated
Notes due 2009, Rayovac had received tenders from holders of, and accepted for
payment, $221,695,000 in aggregate principal amount of the notes representing
approximately 96% of the outstanding notes. Rayovac will redeem any remaining
outstanding United Industries notes on or shortly after April 1, 2005 pursuant
to the applicable terms of the indenture governing those notes.
In connection with the acquisition of United Industries, Rayovac increased the
size of its board of directors from eight to ten members. Scott A. Schoen and
Charles A. Brizius, both of Thomas H. Lee Partners, L.P., have been appointed
as the new members of Rayovac's board. Mr. Schoen is Co-President and Mr.
Brizius is Managing Director of Thomas H. Lee Partners, L.P. In addition,
Robert L. Caulk, CEO of United Industries, will become a member of Rayovac's
Executive Committee.
About United Industries:
United Industries Corporation, headquartered in St. Louis, is a leading
manufacturer and marketer of products for the consumer lawn-and-garden care and
household insect control markets in North America and a leading supplier of
quality products to the pet supply industry in the United States. United
Industries has approximately 2,800 employees throughout North America.
About Rayovac:
Rayovac is a global consumer products company and one of the largest battery,
shaving and grooming, and lighting companies in the world. Through a diverse
and growing portfolio of world-class brands -- including Rayovac, Varta and
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Remington -- Rayovac holds leading market positions in a number of major
product categories. The company's products are sold by 19 of the world's top 20
retailers, and are available in over one million stores in 120 countries around
the world. Headquartered in Atlanta, Georgia, Rayovac generates approximately
$1.5 billion in annual revenues and has approximately 6,500 employees
worldwide. The company's stock trades on the New York Stock Exchange under the
symbol ROV.
Forward-Looking Statements
Certain matters discussed in this news release, with the exception of
historical matters, may be forward-looking statements within the meaning of the
Private Securities Litigation Reform Act of 1995. These statements are subject
to a number of risks, uncertainties and other factors that could cause results
to differ materially from those anticipated as of the date of this release.
Actual results may differ materially from these statements as a result of (1)
our ability to achieve anticipated synergies and efficiencies as a result of
this transaction, (2) changes in external competitive market factors, such as
introduction of new product features or technological developments, development
of new competitors or competitive brands or competitive promotional activity or
spending, (3) changes in consumer demand for the various types of products
Rayovac and United offer, (4) changes in the general economic conditions where
Rayovac and United do business, such as stock market prices, interest rates,
currency exchange rates, inflation and raw material costs, (5) our ability to
successfully implement manufacturing, distribution and other cost efficiencies
and (6) various other factors, including those discussed herein and those set
forth in Rayovac's and United's securities filings, including their most
recently filed Quarterly Reports on Form 10-Q and Annual Reports on Form 10-K.
SOURCE Rayovac Corp.
Investors, Nancy O'Donnell, VP Investor Relations of Rayovac Corp.,
+1-770-829-6208, or Media, David Doolittle of Ketchum for Rayovac,
+1-404-879-9266, david.doolittle@ketchum.com
http://www.prnewswire.com
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