EXHIBIT 99.1
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REVOLVING CREDIT LOAN AGREEMENT
DATED AS OF OCTOBER 8, 2004
AMONG
LONE STAR STEAKHOUSE & SALOON, INC.
AS BORROWER
THE LENDERS FROM TIME TO TIME PARTY HERETO
AND
SUNTRUST BANK
AS ADMINISTRATIVE AGENT
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SUNTRUST XXXXXXXX XXXXXXXX
(A DIVISION OF SUNTRUST CAPITAL MARKETS, INC.)
AS LEAD ARRANGER
TABLE OF CONTENTS
PAGE
ARTICLE I DEFINITIONS; CONSTRUCTION..............................1
SECTION 1.1 DEFINITIONS........................................1
SECTION 1.2 CLASSIFICATIONS OF LOANS AND BORROWINGS...........16
SECTION 1.3 ACCOUNTING TERMS AND DETERMINATION................17
SECTION 1.4 TERMS GENERALLY...................................17
ARTICLE II AMOUNT AND TERMS OF THE COMMITMENTS...................17
SECTION 2.1 GENERAL DESCRIPTION OF FACILITIES.................17
SECTION 2.2 REVOLVING LOANS...................................18
SECTION 2.3 PROCEDURE FOR REVOLVING BORROWINGS................18
SECTION 2.4 FUNDING OF BORROWINGS.............................18
SECTION 2.5 INTEREST ELECTIONS................................19
SECTION 2.6 OPTIONAL REDUCTION AND
TERMINATION OF COMMITMENTS....................20
SECTION 2.7 REPAYMENT OF LOANS................................20
SECTION 2.8 EVIDENCE OF INDEBTEDNESS..........................20
SECTION 2.9 OPTIONAL PREPAYMENTS..............................21
SECTION 2.10 MANDATORY PREPAYMENTS.............................21
SECTION 2.11 INTEREST ON LOANS.................................21
SECTION 2.12 FEES..............................................22
SECTION 2.13 COMPUTATION OF INTEREST AND FEES..................23
SECTION 2.14 INABILITY TO DETERMINE INTEREST RATES.............23
SECTION 2.15 ILLEGALITY........................................23
SECTION 2.16 INCREASED COSTS...................................24
SECTION 2.17 FUNDING INDEMNITY.................................25
SECTION 2.18 TAXES.............................................25
SECTION 2.19 PAYMENTS GENERALLY; PRO RATA TREATMENT;
SHARING OF SETOFFS............................27
SECTION 2.20 INCREASE OF COMMITMENTS; ADDITIONAL LENDERS.......28
SECTION 2.21 MITIGATION OF OBLIGATIONS.........................29
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ARTICLE III CONDITIONS PRECEDENT TO LOANS.........................30
SECTION 3.1 CONDITIONS TO EFFECTIVENESS.......................30
SECTION 3.2 EACH CREDIT EVENT.................................31
SECTION 3.3 DELIVERY OF DOCUMENTS.............................31
ARTICLE IV REPRESENTATIONS AND WARRANTIES........................32
SECTION 4.1 EXISTENCE; POWER..................................32
SECTION 4.2 ORGANIZATIONAL POWER; AUTHORIZATION...............32
SECTION 4.3 GOVERNMENTAL APPROVALS; NO CONFLICTS..............32
SECTION 4.4 FINANCIAL STATEMENTS..............................32
SECTION 4.5 LITIGATION AND ENVIRONMENTAL MATTERS..............33
SECTION 4.6 COMPLIANCE WITH LAWS AND AGREEMENTS...............33
SECTION 4.7 INVESTMENT COMPANY ACT, ETC.......................33
SECTION 4.8 TAXES.............................................33
SECTION 4.9 MARGIN REGULATIONS................................34
SECTION 4.10 ERISA.............................................34
SECTION 4.11 OWNERSHIP OF PROPERTY.............................34
SECTION 4.12 DISCLOSURE........................................34
SECTION 4.13 LABOR RELATIONS...................................35
SECTION 4.14 INSOLVENCY........................................35
SECTION 4.15 SUBSIDIARIES......................................35
SECTION 4.16 OFAC..............................................35
SECTION 4.17 PATRIOT ACT.......................................35
SECTION 4.18 INDEBTEDNESS......................................36
ARTICLE V AFFIRMATIVE COVENANTS.................................36
SECTION 5.1 FINANCIAL STATEMENTS AND OTHER INFORMATION........36
SECTION 5.2 NOTICES OF MATERIAL EVENTS........................37
SECTION 5.3 EXISTENCE; CONDUCT OF BUSINESS....................37
SECTION 5.4 COMPLIANCE WITH LAWS, ETC.........................38
SECTION 5.5 PAYMENT OF OBLIGATIONS............................38
SECTION 5.6 BOOKS AND RECORDS.................................38
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SECTION 5.7 VISITATION, INSPECTION, ETC.......................38
SECTION 5.8 MAINTENANCE OF PROPERTIES; INSURANCE..............38
SECTION 5.9 ADDITIONAL SUBSIDIARIES...........................38
SECTION 5.10 USE OF PROCEEDS...................................39
SECTION 5.11 FURTHER ASSURANCES................................39
ARTICLE VI FINANCIAL COVENANTS...................................39
SECTION 6.1 LEVERAGE RATIO....................................39
SECTION 6.2 FIXED CHARGE COVERAGE RATIO.......................39
SECTION 6.3 CONSOLIDATED NET WORTH............................39
SECTION 6.4 NEW STORE CAPITAL EXPENDITURES....................40
ARTICLE VII NEGATIVE COVENANTS....................................40
SECTION 7.1 INDEBTEDNESS......................................40
SECTION 7.2 NEGATIVE PLEDGE...................................40
SECTION 7.3 FUNDAMENTAL CHANGES...............................41
SECTION 7.4 INVESTMENTS, LOANS, ETC...........................41
SECTION 7.5 ACQUISITIONS......................................42
SECTION 7.6 SALE OF ASSETS....................................43
SECTION 7.7 TRANSACTIONS WITH AFFILIATES......................43
SECTION 7.8 RESTRICTIVE AGREEMENTS............................43
SECTION 7.9 SALE AND LEASEBACK TRANSACTIONS...................44
SECTION 7.11 HEDGING TRANSACTIONS..............................44
SECTION 7.12 AMENDMENT TO MATERIAL DOCUMENTS...................44
SECTION 7.13 ACCOUNTING CHANGES................................44
ARTICLE VIII EVENTS OF DEFAULT.....................................44
SECTION 8.1 EVENTS OF DEFAULT.................................44
ARTICLE IX THE ADMINISTRATIVE AGENT..............................47
SECTION 9.1 APPOINTMENT OF ADMINISTRATIVE AGENT...............47
SECTION 9.2 NATURE OF DUTIES OF ADMINISTRATIVE AGENT..........47
SECTION 9.3 LACK OF RELIANCE ON THE ADMINISTRATIVE AGENT......48
SECTION 9.4 CERTAIN RIGHTS OF THE ADMINISTRATIVE AGENT........48
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SECTION 9.5 RELIANCE BY ADMINISTRATIVE AGENT..................48
SECTION 9.6 THE ADMINISTRATIVE AGENT IN ITS
INDIVIDUAL CAPACITY...........................48
SECTION 9.7 SUCCESSOR ADMINISTRATIVE AGENT....................49
SECTION 9.8 AUTHORIZATION TO EXECUTE OTHER LOAN DOCUMENTS.....49
ARTICLE X MISCELLANEOUS.........................................49
SECTION 10.1 NOTICES...........................................49
SECTION 10.2 WAIVER; AMENDMENTS................................51
SECTION 10.3 EXPENSES; INDEMNIFICATION.........................51
SECTION 10.4 SUCCESSORS AND ASSIGNS............................53
SECTION 10.5 GOVERNING LAW; JURISDICTION;
CONSENT TO SERVICE OF PROCESS.................55
SECTION 10.6 WAIVER OF JURY TRIAL..............................56
SECTION 10.7 RIGHT OF SETOFF...................................56
SECTION 10.8 COUNTERPARTS; INTEGRATION.........................56
SECTION 10.9 SURVIVAL..........................................57
SECTION 10.10 SEVERABILITY......................................57
SECTION 10.11 CONFIDENTIALITY...................................57
SECTION 10.12 INTEREST RATE LIMITATION..........................58
SECTION 10.13 WAIVER OF EFFECT OF CORPORATE SEAL................58
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SCHEDULES
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Schedule 4.5 - Environmental Matters
Schedule 4.15 - Subsidiaries
Schedule 7.1 - Outstanding Indebtedness
Schedule 7.2 - Existing Liens
Schedule 7.4 - Existing Investments
EXHIBITS
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Exhibit A - Form of Revolving Credit Note
Exhibit B - Form of Assignment and Acceptance
Exhibit C - Form of Subsidiary Guaranty Agreement
Exhibit D - Form of Compliance Certificate
Exhibit 2.3 - Form of Notice of Revolving Borrowing
Exhibit 2.5 - Form of Continuation/Conversion
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REVOLVING CREDIT LOAN AGREEMENT
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THIS REVOLVING CREDIT LOAN AGREEMENT (this "AGREEMENT") is made and
entered into as of October 8, 2004, by and among LONE STAR STEAKHOUSE & SALOON,
INC., a Delaware corporation (the "BORROWER"), SUNTRUST BANK, INTRUST BANK, N.A.
and the several banks and other financial institutions from time to time party
hereto (the "LENDERS"), and SUNTRUST BANK, in its capacity as Administrative
Agent for the Lenders (the "ADMINISTRATIVE AGENT" or "AGENT").
W I T N E S S E T H:
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WHEREAS, the Borrower has requested that the Lenders establish a
$30,000,000 revolving credit facility in favor of the Borrower;
WHEREAS, subject to the terms and conditions of this Agreement, the
Lenders severally, to the extent of their respective Revolving Commitments, are
willing to establish the requested revolving credit facility for the Borrower.
NOW, THEREFORE, in consideration of the premises and the mutual covenants
herein contained, the Borrower, the Lenders and the Administrative Agent agree
as follows:
ARTICLE I
DEFINITIONS; CONSTRUCTION
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SECTION 1.1 DEFINITIONS. In addition to the other terms defined herein,
the following terms used herein shall have the meanings herein specified (to be
equally applicable to both the singular and plural forms of the terms defined):
"ACQUISITION" shall mean any transaction or series of related
transactions, consummated on or after the date hereof, by which the Borrower
directly, or indirectly through one or more Subsidiaries, (i) acquires all or
substantially all of the assets, of any Person, whether through purchase of
assets, merger or otherwise or (ii) acquires securities or other ownership
interests of any Person having at least a majority of combined voting power of
the then outstanding securities or other ownership interests of such Person.
"ADDITIONAL LENDER" shall have the meaning given to such term in SECTION
2.20.
"ADJUSTED LIBO RATE" shall mean, with respect to each Interest Period for
a Eurodollar Borrowing, the rate per annum obtained by dividing (i) LIBOR for
such Interest Period by (ii) a percentage equal to 1.00 minus the Eurodollar
Reserve Percentage.
"ADMINISTRATIVE AGENT" shall have the meaning assigned to such term in the
opening paragraph hereof.
"ADMINISTRATIVE QUESTIONNAIRE" shall mean, with respect to each Lender, an
administrative questionnaire in the form prepared by the Administrative Agent
and submitted to the Administrative Agent duly completed by such Lender.
"AFFILIATE" shall mean, as to any Person, any other Person that directly,
or indirectly through one or more intermediaries, Controls, is Controlled by, or
is under common Control with, such Person.
"AGGREGATE REVOLVING COMMITMENTS" shall mean the sum of the Revolving
Commitments of all Lenders at any time outstanding, as such amounts may be
increased or decreased pursuant to the terms and conditions hereof. On the
Closing Date, the Aggregate Revolving Commitments equal Thirty Million Dollars
($30,000,000).
"APPLICABLE LENDING OFFICE" shall mean, for each Lender and for each Type
of Loan, the "Lending Office" of such Lender (or an Affiliate of such Lender)
designated for such Type of Loan in the Administrative Questionnaire submitted
by such Lender or such other office of such Lender (or an Affiliate of such
Lender) as such Lender may from time to time specify to the Administrative Agent
and the Borrower as the office by which its Loans of such Type are to be made
and maintained.
"APPROVED FUND" shall mean 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 and that is administered or managed by (a) a Lender, (b) an Affiliate
of a Lender or (c) an entity or an Affiliate of an entity that administers or
manages a Lender.
"ASSIGNMENT AND ACCEPTANCE" shall mean an assignment and acceptance
entered into by a Lender and an assignee (with the consent of any party whose
consent is required by SECTION 10.4(b)) and accepted by the Administrative
Agent, in the form of EXHIBIT B attached hereto or any other form approved by
the Administrative Agent.
"AVAILABILITY PERIOD" shall mean the period from the Closing Date to the
Commitment Termination Date.
"BASE RATE" shall mean the higher of (i) the per annum rate which the
Administrative Agent publicly announces from time to time to be its prime
lending rate, as in effect from time to time, or (ii) the Federal Funds Rate, as
in effect from time to time, plus one-half of one percent (0.50%). The
Administrative Agent's prime lending rate is a reference rate and does not
necessarily represent the lowest or best rate charged to customers. The
Administrative Agent may make commercial loans or other loans at rates of
interest at, above or below the Administrative Agent's prime lending rate. Each
change in the Administrative Agent's prime lending rate shall be effective from
and including the date such change is publicly announced as being effective.
"BORROWER" shall have the meaning in the introductory paragraph hereof.
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"BORROWING" shall mean a borrowing consisting of Loans of the same Type,
made, converted or continued on the same date and in case of Eurodollar Loans,
as to which a single Interest Period is in effect.
"BUSINESS DAY" shall mean (i) any day other than a Saturday, Sunday or
other day on which commercial banks in Atlanta, Georgia or Nashville, Tennessee
are authorized or required by law to close and (ii) if such day relates to a
Borrowing of, a payment or prepayment of principal or interest on, a conversion
of or into, or an Interest Period for, a Eurodollar Loan or a notice with
respect to any of the foregoing, any day on which dealings in Dollars are
carried on the London interbank market.
"CAPITAL EXPENDITURES" shall mean for any period, without duplication, (a)
the additions to property, plant and equipment and other capital expenditures of
the Borrower and its Subsidiaries that are (or would be) set forth on a
consolidated statement of cash flows of the Borrower for such period prepared in
accordance with GAAP and (b) Capital Lease Obligations incurred by the Borrower
and its Subsidiaries during such period.
"CAPITAL LEASE OBLIGATIONS" of any Person shall mean all obligations of
such Person to pay rent or other amounts under any lease (or other arrangement
conveying the right to use) real or personal property, or a combination thereof,
which obligations are required to be classified and accounted for as capital
leases on a balance sheet of such Person under GAAP, and the amount of such
obligations shall be the capitalized amount thereof determined in accordance
with GAAP.
"CHANGE IN CONTROL" shall mean the occurrence of one or more of the
following events: (a) any sale, lease, exchange or other transfer (in a single
transaction or a series of related transactions) of all or substantially all of
the assets of the Borrower to any Person or "group" (within the meaning of the
Securities Exchange Act of 1934 and the rules of the Securities and Exchange
Commission thereunder in effect on the date hereof), (b) the acquisition of
ownership, directly or indirectly, beneficially or of record, by any Person or
"group" (within the meaning of the Securities Exchange Act of 1934 and the rules
of the Securities and Exchange Commission thereunder as in effect on the date
hereof) of 30% or more of the outstanding shares of the voting stock of the
Borrower (notwithstanding the foregoing, if a Person or "group" presently owns
five percent (5%) or more of the shares of Borrower or such Person or "group" is
currently part of the existing management, such acquisition of ownership will
not constitute a "change in control"; or (c) occupation of a majority of the
seats (other than vacant seats) on the board of directors of the Borrower by
Persons who were neither (i) nominated by the current board of directors or (ii)
appointed by directors so nominated.
"CHANGE IN LAW" shall mean (i) the adoption of any applicable law, rule or
regulation after the date of this Agreement, (ii) any change in any applicable
law, rule or regulation, or any change in the interpretation or application
thereof, by any Governmental Authority after the date of this Agreement, or
(iii) compliance by any Lender (or its Applicable Lending Office) (or for
purposes of SECTION 2.16(B), by such Lender's holding company, if applicable)
with any request, guideline or directive (whether or not having the force of
law) of any Governmental Authority made or issued after the date of this
Agreement.
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"CLOSING DATE" shall mean the date on which the conditions precedent set
forth in SECTION 3.1 and SECTION 3.2 have been satisfied or waived in accordance
with SECTION 10.2.
"CODE" shall mean the Internal Revenue Code of 1986, as amended and in
effect from time to time.
"COMMITMENT TERMINATION DATE" shall mean the earliest of (i) October 5,
2007, (ii) the date on which the Revolving Commitments are terminated pursuant
to SECTION 2.6 or (iii) the date on which all amounts outstanding under this
Agreement have been declared or have automatically become due and payable
(whether by acceleration or otherwise).
"COMPLIANCE CERTIFICATE" shall mean a certificate from the principal
financial officer of the Borrower in the form of, and containing the
certifications set forth in, the certificate attached hereto as EXHIBIT D.
"CONSOLIDATED EBITDA" shall mean, for the Borrower and its Subsidiaries on
a consolidated basis for any period, an amount equal to the sum of (a)
Consolidated Net Income for such period plus (b) to the extent deducted in
determining Consolidated Net Income for such period (and without duplication),
(i) Consolidated Interest Expense, (ii) income tax expense, (iii) depreciation
and amortization and (iv) all other non-cash losses for such period (including
non-cash charges or credits related to stock options of the Borrower,
transaction expenses and the amortization of debt discount) minus (c) to the
extent included in determining Consolidated Net Income for such period (and
without duplication), non-cash gains. For purposes of this definition, with
respect to any Person, or all or substantially all of the assets of a Person,
that is no longer a Subsidiary of the Borrower, or any Person that became a
Subsidiary of the Borrower, or that was merged with or into, or acquired by, the
Borrower or its Subsidiaries during such period, Consolidated EBITDA shall also
exclude or include, as the case may be, the Consolidated EBITDA of such Person
or the Consolidated EBITDA attributable to such assets of such Person during
such period as if such Person or assets were sold or acquired as of the first
day of such period, together with such add-backs as may be approved in writing
by the Administrative Agent.
"CONSOLIDATED EBITDAR" shall mean, for the Borrower and its Subsidiaries
for any period, an amount equal to the sum of (a) Consolidated EBITDA and (b)
Consolidated Lease Expense.
"CONSOLIDATED FIXED CHARGES" shall mean, for the Borrower and its
Subsidiaries for any period, the sum (without duplication) of (a) Consolidated
Interest Expense for such period, (b) scheduled principal payments (or the
functional equivalent thereof) made on Consolidated Total Debt during such
period, (c) Dividends paid during such period, (d) income tax expense, (e)
Consolidated Lease Expense for such period, and (f) Maintenance Capital
Expenditures for such period.
"CONSOLIDATED INTEREST EXPENSE" shall mean, for the Borrower and its
Subsidiaries for any period determined on a consolidated basis in accordance
with GAAP, the sum of (i) total interest expense, including without limitation
4
the interest component of any payments in respect of Capital Leases Obligations
capitalized or expensed during such period (whether or not actually paid during
such period) plus (ii) the net amount payable (or minus the net amount
receivable) with respect to Hedging Obligations during such period (whether or
not actually paid or received during such period).
"CONSOLIDATED LEASE EXPENSE" shall mean, for any period, the aggregate
amount of fixed and contingent rentals payable by the Borrower and its
Subsidiaries with respect to leases of real and personal property (excluding
Capital Lease Obligations) determined on a consolidated basis in accordance with
GAAP for such period.
"CONSOLIDATED NET INCOME" shall mean, for any period, the net income (or
loss) of the Borrower and its Subsidiaries for such period determined on a
consolidated basis in accordance with GAAP, but excluding therefrom (to the
extent otherwise included therein) (i) any extraordinary gains or losses, (ii)
any gains or losses attributable to write-ups or write-downs of assets; and
(iii) any equity interest of the Borrower or any Subsidiary of the Borrower in
the unremitted earnings of any Person that is not a Subsidiary.
"CONSOLIDATED NET WORTH" shall mean, as of any date, (i) the total assets
of the Borrower and its Subsidiaries that would be reflected on the Borrower's
consolidated balance sheet as of such date prepared in accordance with GAAP,
after eliminating all amounts properly attributable to minority interests, if
any, in the stock and surplus of Subsidiaries, minus (ii) the total liabilities
of the Borrower and its Subsidiaries that would be reflected on the Borrower's
consolidated balance sheet as of such date prepared in accordance with GAAP.
"CONSOLIDATED TOTAL DEBT" shall mean, as of any date of determination and
without duplication, all Indebtedness of the Borrower and its Subsidiaries of
the types described in clauses (i) through (x) of the definition of Indebtedness
determined on a consolidated basis in accordance with XXXX, including, without
limitation, all Loans.
"CONTRACTUAL OBLIGATION" of any Person shall mean any provision of any
security issued by such person or of any agreement, instrument or undertaking
under which such Person is obligated or by which it or any of the property in
which it has an interest is bound.
"CONTROL" shall mean the power, directly or indirectly, either to (i) vote
5% or more of securities having ordinary voting power for the election of
directors (or persons performing similar functions) of a Person or (ii) direct
or cause the direction of the management and policies of a Person, whether
through the ability to exercise voting power, by contract or otherwise. The
terms "CONTROLLING", "CONTROLLED BY", and "UNDER COMMON CONTROL WITH" have
meanings correlative thereto.
"DEFAULT" shall mean any condition or event that, with the giving of
notice or the lapse of time or both, would constitute an Event of Default.
"DEFAULT INTEREST" shall have the meaning set forth in SECTION 2.11(D).
"DIVIDENDS" shall mean (a) the payment of any dividend on or in respect of
any shares of any class of stock or other ownership interests of any Person,
other than dividends payable solely in shares of common stock of such Person; or
(b) any other distribution on or in respect of any shares of any class of stock
or other ownership interests of such Person.
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"DOLLAR(S)" and the sign "$" shall mean lawful money of the United States
of America.
"ELIGIBLE ASSIGNEE" shall mean (i) a Lender; (ii) an Affiliate of a
Lender; (iii) an Approved Fund; and (iv) any other Person (other than a natural
Person) approved by the Administrative Agent, and unless an Event of Default has
occurred and is continuing, the Borrower (each such approval not to be
unreasonably withheld or delayed). If the consent of the Borrower to an
assignment or to an Eligible Assignee is required hereunder (including a consent
to an assignment which does not meet the minimum assignment thresholds specified
in SECTION 10.4(B)), the Borrower shall be deemed to have given its consent five
Business Days after the date notice thereof has actually been delivered by the
assigning Lender (through the Administrative Agent) to the Borrower, unless such
consent is expressly refused by the Borrower prior to such fifth Business Day.
"ENVIRONMENTAL LAWS" shall mean all laws, rules, regulations, codes,
ordinances, orders, decrees, judgments, injunctions, notices or binding
agreements issued, promulgated or entered into by or with any Governmental
Authority, relating in any way to the environment, preservation or reclamation
of natural resources, the management, Release or threatened Release of any
Hazardous Material or to health and safety matters.
"ENVIRONMENTAL LIABILITY" shall mean any liability, contingent or
otherwise (including any liability for damages, costs of environmental
investigation and remediation, costs of administrative oversight, fines, natural
resource damages, penalties or indemnities), of the Borrower or any Subsidiary
directly or indirectly resulting from or based upon (a) any actual or alleged
violation of any Environmental Law, (b) the generation, use, handling,
transportation, storage, treatment or disposal of any Hazardous Materials, (c)
any actual or alleged exposure to any Hazardous Materials, (d) the Release or
threatened Release of any Hazardous Materials or (e) any contract, agreement or
other consensual arrangement pursuant to which liability is assumed or imposed
with respect to any of the foregoing.
"ERISA" shall mean the Employee Retirement Income Security Act of 1974, as
amended from time to time, and any successor statute.
"ERISA AFFILIATE" shall mean any trade or business (whether or not
incorporated), which, together with the Borrower, is treated as a single
employer under Section 414(b) or (c) of the Code or, solely for the purposes of
Section 302 of ERISA and Section 412 of the Code, is treated as a single
employer under Section 414 of the Code.
"ERISA EVENT" shall mean (a) any "reportable event", as defined in Section
4043 of ERISA or the regulations issued thereunder with respect to a Plan (other
than an event for which the 30-day notice period is waived); (b) the existence
with respect to any Plan of an "accumulated funding deficiency" (as defined in
Section 412 of the Code or Section 302 of ERISA), whether or not waived; (c) the
filing pursuant to Section 412(d) of the Code or Section 303(d) of ERISA of an
application for a waiver of the minimum funding standard with respect to any
Plan; (d) the incurrence by the Borrower or any of its ERISA Affiliates of any
liability under Title IV of ERISA with respect to the termination of any Plan;
(e) the receipt by the Borrower or any ERISA Affiliate from the PBGC or a plan
6
administrator appointed by the PBGC of any notice relating to an intention to
terminate any Plan or Plans or to appoint a trustee to administer any Plan; (f)
the incurrence by the Borrower or any of its ERISA Affiliates of any liability
with respect to the withdrawal or partial withdrawal from any Plan or
Multiemployer Plan; or (g) the receipt by the Borrower or any ERISA Affiliate of
any notice, or the receipt by any Multiemployer Plan from the Borrower or any
ERISA Affiliate of any notice, concerning the imposition of Withdrawal Liability
or a determination that a Multiemployer Plan is, or is expected to be, insolvent
or in reorganization, within the meaning of Title IV of ERISA.
"EURODOLLAR" when used in reference to any Loan or Borrowing refers to
whether such Loan, or the Loans comprising such Borrowing, bears interest at a
rate determined by reference to the Adjusted LIBO Rate.
"EURODOLLAR RESERVE PERCENTAGE" shall mean the aggregate of the maximum
reserve percentages (including, without limitation, any emergency, supplemental,
special or other marginal reserves) expressed as a decimal (rounded upwards to
the next 1/100th of 1%) in effect on any day to which the Administrative Agent
is subject with respect to the Adjusted LIBO Rate pursuant to regulations issued
by the Board of Governors of the Federal Reserve System (or any Governmental
Authority succeeding to any of its principal functions) with respect to
eurocurrency funding (currently referred to as "eurocurrency liabilities" under
Regulation D). Eurodollar Loans shall be deemed to constitute eurocurrency
funding and to be subject to such reserve requirements without benefit of or
credit for proration, exemptions or offsets that may be available from time to
time to any Lender under Regulation D. The Eurodollar Reserve Percentage shall
be adjusted automatically on and as of the effective date of any change in any
reserve percentage.
"EVENT OF DEFAULT" shall have the meaning provided in Article VIII.
"EXCLUDED TAXES" shall mean with respect to the Administrative Agent, any
Lender or any other recipient of any payment to be made by or on account of any
obligation of the Borrower hereunder, (a) income or franchise taxes imposed on
(or measured by) its net income by the United States of America, or by the
jurisdiction under the laws of which such recipient is organized or in which its
principal office is located or, in the case of any Lender, in which its
applicable lending office is located, (b) any branch profits taxes imposed by
the United States of America or any similar tax imposed by any other
jurisdiction in which any Lender is located and (c) in the case of a Foreign
Lender, any withholding tax that (i) is imposed on amounts payable to such
Foreign Lender at the time such Foreign Lender becomes a party to this
Agreement, (ii) is imposed on amounts payable to such Foreign Lender at any time
that such Foreign Lender designates a new lending office, other than taxes that
have accrued prior to the designation of such lending office that are otherwise
not Excluded Taxes, and (iii) is attributable to such Foreign Lender's failure
to comply with SECTION 2.18(E).
"FEDERAL FUNDS RATE" shall mean, for any day, the rate per annum (rounded
upwards, if necessary, to the next 1/100th of 1%) equal to the weighted average
of the rates on overnight Federal funds transactions with member banks of the
Federal Reserve System arranged by Federal funds brokers, as published by the
Federal Reserve Bank of New York on the next succeeding Business Day or if such
rate is not so published for any Business Day, the Federal Funds Rate for such
day shall be the average rounded upwards, if necessary, to the next 1/100th of
1% of the quotations for such day on such transactions received by the
Administrative Agent from three Federal funds brokers of recognized standing
selected by the Administrative Agent.
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"FIXED CHARGE COVERAGE RATIO" shall mean, for any period of four
consecutive fiscal quarters of the Borrower and its Subsidiaries, the ratio of
(a) Consolidated EBITDAR for such period to (b) Consolidated Fixed Charges for
such period.
"FOREIGN LENDER" shall mean any Lender that is not a United States person
under Section 7701(a)(3) of the Code.
"GAAP" shall mean generally accepted accounting principles in the United
States applied on a consistent basis and subject to the terms of SECTION 1.3.
"GOVERNMENTAL AUTHORITY" shall mean the government of the United States of
America, any other nation or any political subdivision thereof, whether state or
local, and any agency, authority, instrumentality, regulatory body, court,
central bank or other entity exercising executive, legislative, judicial,
taxing, regulatory or administrative powers or functions of or pertaining to
government.
"GUARANTEE" of or by any Person (the "GUARANTOR") shall mean any
obligation, contingent or otherwise, of the guarantor guaranteeing or having the
economic effect of guaranteeing any Indebtedness or other obligation of any
other Person (the "PRIMARY OBLIGOR") in any manner, whether directly or
indirectly and including any obligation, direct or indirect, of the guarantor
(a) to purchase or pay (or advance or supply funds for the purchase or payment
of) such Indebtedness or other obligation or to purchase (or to advance or
supply funds for the purchase of) any security for the payment thereof, (b) to
purchase or lease property, securities or services for the purpose of assuring
the owner of such Indebtedness or other obligation of the payment thereof, (c)
to maintain working capital, equity capital or any other financial statement
condition or liquidity of the primary obligor so as to enable the primary
obligor to pay such Indebtedness or other obligation or (d) as an account party
in respect of any letter of credit or letter of guaranty issued in support of
such Indebtedness or obligation; PROVIDED, that the term "Guarantee" shall not
include endorsements for collection or deposits in the ordinary course of
business. The amount of any Guarantee shall be deemed to be an amount equal to
the stated or determinable amount of the primary obligation in respect of which
Guarantee is made or, if not so stated or determinable, the maximum reasonably
anticipated liability in respect thereof (assuming such Person is required to
perform thereunder) as determined by such Person in good faith. The term
"Guarantee" used as a verb has a corresponding meaning.
"HAZARDOUS MATERIALS" shall mean all explosive or radioactive substances
or wastes and all hazardous or toxic substances, wastes or other pollutants,
including petroleum or petroleum distillates, asbestos or asbestos containing
materials, polychlorinated biphenyls, radon gas, infectious or medical wastes
and all other substances or wastes of any nature regulated pursuant to any
Environmental Law.
"HEDGING OBLIGATIONS" of any Person shall mean any and all obligations of
such Person, whether absolute or contingent and howsoever and whensoever
created, arising, evidenced or acquired under (i) any and all Hedging
Transactions, (ii) any and all cancellations, buy backs, reversals, terminations
or assignments of any Hedging Transactions and (iii) any and all renewals,
extensions and modifications of any Hedging Transactions and any and all
substitutions for any Hedging Transactions.
8
"HEDGING TRANSACTION" of any Person shall mean any transaction (including
an agreement with respect thereto) now existing or hereafter entered into by
such Person that is a rate swap, basis swap, forward rate transaction, commodity
swap, interest rate option, foreign exchange transaction, cap transaction, floor
transaction, collateral transaction, forward transaction, currency swap
transaction, cross-currency rate swap transaction, currency option or any other
similar transaction (including any option with respect to any of these
transactions) or any combination thereof, whether linked to one or more interest
rates, foreign currencies, commodity prices, equity prices or other financial
measures.
"INDEBTEDNESS" of any Person shall mean, without duplication (i) all
obligations of such Person for borrowed money, (ii) all obligations of such
Person evidenced by bonds, debentures, notes, drafts, bankers' acceptances or
other similar instruments, (iii) all obligations of such Person in respect of
the deferred purchase price of property or services (other than trade payables
incurred in the ordinary course of business; PROVIDED, that trade payables
overdue by more than 90 days shall be included in this definition), (iv) all
Capital Lease Obligations of such Person, (v) all Indebtedness of a third party
secured by any Lien on property owned by such Person, whether or not such
Indebtedness has been assumed by such Person, (vi) all Hedging Obligations;
(vii) all obligations, contingent or otherwise, of such Person in respect of
letters of credit (including all contingent reimbursement obligations, whether
or not any draws under such letters of credit have been presented for payment),
and all drafts, bankers' acceptances or similar instruments, (viii) all
Off-Balance Sheet Liabilities; (ix) all obligations of such Person, contingent
or otherwise, to purchase, redeem, retire or otherwise acquire for value any
common stock of such Person, (x) all Guarantees of such Person of the type of
Indebtedness described in clauses (i) through (ix) above, and (xi) all
obligations and liabilities of such Person that are required by GAAP to be shown
as liabilities on the balance sheet of such Person (other than reserves required
by GAAP). The Indebtedness of any Person shall include the Indebtedness of any
partnership or joint venture in which such Person is a general partner or a
joint venturer, except to the extent that the terms of such Indebtedness provide
that such Person is not liable therefor.
"INDEMNIFIED TAXES" shall mean Taxes other than Excluded Taxes.
"INTEREST PERIOD" shall mean (i) with respect to any Eurodollar Borrowing,
a period of one, two, three or six months; PROVIDED, that:
(i) the initial Interest Period for such Borrowing shall commence
on the date of such Borrowing (including the date of any conversion
from a Borrowing of another Type) and each Interest Period occurring
thereafter in respect of such Borrowing shall commence on the day on
which the next preceding Interest Period expires;
(ii) if any Interest Period would otherwise end on a day other
than a Business Day, such Interest Period shall be extended to the
next succeeding Business Day, unless, in the case of a Eurodollar
Borrowing, such Business Day falls in another calendar month, in which
case such Interest Period would end on the next preceding Business
Day;
9
(iii) any Interest Period in respect of a Eurodollar Borrowing
which begins on the last Business Day of a calendar month or on a day
for which there is no numerically corresponding day in the calendar
month at the end of such Interest Period shall end on the last
Business Day of such calendar month; and
(iv) no Interest Period may extend beyond the Commitment
Termination Date.
"LENDERS" shall have the meaning assigned to such term in the opening
paragraph of this Agreement and shall include each Additional Lender that joins
this Agreement pursuant to SECTION 2.20.
"LEVERAGE RATIO" shall mean, for any period of four consecutive fiscal
quarters of the Borrower and its Subsidiaries, the ratio of (i) Consolidated
Total Debt as of the last day of such period to (ii) Consolidated EBITDA for
such period.
"LIBOR" shall mean, for any applicable Interest Period with respect to any
Eurodollar Loan, the British Bankers' Association Interest Settlement Rate per
annum for deposits in Dollars for a period equal to such Interest Period
appearing on the display designated as Page 3750 on the Dow Xxxxx Markets
Service (or such other page on that service or such other service designated by
the British Bankers' Association for the display of such Association's Interest
Settlement Rates for Dollar deposits) as of 11:00 a.m. (London, England time) on
the day that is two Business Days prior to the first day of the Interest Period
or if such Page 3750 is unavailable for any reason at such time, the rate which
appears on the Reuters Screen ISDA Page as of such date and such time; PROVIDED,
that if the Administrative Agent determines that the relevant foregoing sources
are unavailable for the relevant Interest Period, LIBOR shall mean the rate of
interest determined by the Administrative Agent to be the average (rounded
upward, if necessary, to the nearest 1/100th of 1%) of the rates per annum at
which deposits in Dollars are offered to the Administrative Agent two (2)
Business Days preceding the first day of such Interest Period by leading banks
in the London interbank market as of 10:00 a. m. (Atlanta, Georgia time) for
delivery on the first day of such Interest Period, for the number of days
comprised therein and in an amount comparable to the amount of the Eurodollar
Loan of the Administrative Agent.
"LIEN" shall mean any mortgage, pledge, security interest, lien (statutory
or otherwise), charge, encumbrance, hypothecation, assignment, deposit
arrangement, or other arrangement having the practical effect of the foregoing
or any preference, priority or other security agreement or preferential
arrangement of any kind or nature whatsoever (including any conditional sale or
other title retention agreement and any capital lease having the same economic
effect as any of the foregoing).
"LOAN DOCUMENTS" shall mean, collectively, this Agreement, the Notes, all
Notices of Borrowing, all Notices of Conversion/Continuation, all Compliance
Certificates, the Subsidiary Guaranty Agreement, and any and all other
instruments, agreements, documents and writings executed in connection with any
of the foregoing.
"LOAN PARTIES" shall mean the Borrower and the Subsidiary Loan Parties.
"LOANS" shall mean all Revolving Loans in the aggregate or any of them, as
the context shall require.
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"MAINTENANCE CAPITAL EXPENDITURES" shall mean Capital Expenditures
incurred by the Borrower or its Subsidiaries for ordinary and necessary
maintenance of its property, plant and equipment.
"MATERIAL ADVERSE EFFECT" shall mean, with respect to any event, act,
condition or occurrence of whatever nature (including any adverse determination
in any litigation, arbitration, or governmental investigation or proceeding),
whether singularly or in conjunction with any other event or events, act or
acts, condition or conditions, occurrence or occurrences whether or not related,
a material adverse change in, or a material adverse effect on, (i) the business,
results of operations, financial condition, assets or liabilities of the
Borrower and of the Borrower and its Subsidiaries taken as a whole, (ii) the
ability of the Loan Parties to perform any of their respective obligations under
the Loan Documents, (iii) the rights and remedies of the Administrative Agent
and the Lenders under any of the Loan Documents or (iv) the legality, validity
or enforceability of any of the Loan Documents.
"MATERIAL INDEBTEDNESS" shall mean Indebtedness (other than the Loans) or
Hedging Obligations of the Borrower or any of its Subsidiaries in an aggregate
principal amount exceeding $2,000,000. For purposes of determining the amount of
attributed Indebtedness from Hedging Obligations, the "principal amount" of any
Hedging Obligations at any time shall be the Net Xxxx-to-Market Exposure of such
Hedging Obligations at such time.
"MATERIAL SUBSIDIARY" shall mean at any time any direct or indirect
Subsidiary of the Borrower having: (a) assets in an amount equal to at least 5%
of the total assets of the Borrower and its Subsidiaries determined on a
consolidated basis as of the last day of the most recent fiscal quarter of the
Borrower at such time; or (b) revenues or net income in an amount equal to at
least 5% of the total revenues or net income of the Borrower and its
Subsidiaries on a consolidated basis for the 12-month period ending on the last
day of the most recent fiscal quarter of the Borrower at such time.
"MOODY'S" shall mean Xxxxx'x Investors Service, Inc.
"MULTIEMPLOYER PLAN" shall have the meaning set forth in Section
4001(a)(3) of ERISA.
"NET XXXX-TO-MARKET EXPOSURE" of any Person shall mean, as of any date of
determination with respect to any Hedging Obligation, the excess (if any) of all
unrealized losses over all unrealized profits of such Person arising from such
Hedging Obligation. "Unrealized losses" shall mean the fair market value of the
cost to such Person of replacing the Hedging Transaction giving rise to such
Hedging Obligation as of the date of determination (assuming the Hedging
Transaction were to be terminated as of that date), and "unrealized profits"
means the fair market value of the gain to such Person of replacing such Hedging
Transaction as of the date of determination (assuming such Hedging Transaction
were to be terminated as of that date).
"NEW STORE CAPITAL EXPENDITURES" shall mean Capital Expenditures relating
to the acquisition and/or construction of new units, and/or remodels of existing
units, operated by the Borrower and its Subsidiaries.
"NOTES" shall mean, collectively, the Revolving Credit Notes.
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"NOTICES OF BORROWING" shall mean the Notices of Revolving Borrowing.
"NOTICE OF CONVERSION/CONTINUATION" shall mean the notice given by the
Borrower to the Administrative Agent in respect of the conversion or
continuation of an outstanding Borrowing as provided in SECTION 2.5(B) hereof.
"NOTICE OF REVOLVING BORROWING" shall have the meaning as set forth in
SECTION 2.3.
"OBLIGATIONS" shall mean all amounts owing by the Borrower or its
Subsidiaries to the Administrative Agent or any Lender pursuant to or in
connection with this Agreement or any other Loan Document, including without
limitation, all principal, interest (including any interest accruing after the
filing of any petition in bankruptcy or the commencement of any insolvency,
reorganization or like proceeding relating to the Borrower or its Subsidiaries,
whether or not a claim for post-filing or post-petition interest is allowed in
such proceeding), all reimbursement obligations, fees, expenses, indemnification
and reimbursement payments, costs and expenses of the Administrative Agent and
all Lenders (including all fees and expenses of counsel to the Administrative
Agent and any Lender incurred pursuant to this Agreement or any other Loan
Document), whether direct or indirect, absolute or contingent, liquidated or
unliquidated, now existing or hereafter arising hereunder or thereunder, and all
Hedging Obligations owed to the Administrative Agent, any Lender or any of their
Affiliates incurred in order to limit interest rate or fee fluctuations with
respect to the Loans and all obligations and liabilities incurred in connection
with collecting and enforcing the foregoing, together with all renewals,
extensions, modifications or refinancings thereof.
"OFF-BALANCE SHEET LIABILITIES" of any Person shall mean (i) any
repurchase or other obligation or liability of such Person with respect to
accounts, payment intangibles or receivables sold by such Person, (ii) any
liability of such Person under any sale and leaseback transactions which do not
create a liability on the balance sheet of such Person, (iii) any Synthetic
Lease Obligation or (iv) any obligation arising with respect to any other
transaction which is the functional equivalent of or takes the place of
borrowing but which does not constitute a liability on the balance sheet of such
Person.
"OTHER TAXES" shall mean any and all present or future stamp or
documentary taxes or any other excise or property taxes, charges or similar
levies arising from any payment made hereunder or from the execution, delivery
or enforcement of, or otherwise with respect to, this Agreement or any other
Loan Document.
"OSHA" shall mean the Occupational Safety and health Act of 1970, as
amended from time to time and any successor statute.
"PARTICIPANT" shall have the meaning set forth in SECTION 10.4(D).
"PAYMENT OFFICE" shall mean the office of the Administrative Agent located
at 000 Xxxxxxxxx Xxxxxx, X.X., Xxxxxxx, Xxxxxxx 00000, or such other location as
to which the Administrative Agent shall have given written notice to the
Borrower and the other Lenders.
"PBGC" shall mean the Pension Benefit Guaranty Corporation referred to and
defined in ERISA, and any successor entity performing similar functions.
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"PERMITTED ENCUMBRANCES" shall mean
(i) Liens imposed by law for taxes not yet due or which are being
contested in good faith by appropriate proceedings and with respect to
which adequate reserves are being maintained in accordance with GAAP;
(ii) statutory Liens of landlords and Liens of carriers, warehousemen,
mechanics, materialmen and other Liens imposed by law created in the
ordinary course of business for amounts not yet due or which are being
contested in good faith by appropriate proceedings and with respect to
which adequate reserves are being maintained in accordance with GAAP;
(iii) pledges and deposits made in the ordinary course of business in
compliance with workers' compensation, unemployment insurance and other
social security laws or regulations;
(iv) deposits to secure the performance of bids, trade contracts,
leases, statutory obligations, surety and appeal bonds, performance bonds
and other obligations of a like nature, in each case in the ordinary course
of business;
(v) judgment and attachment liens not giving rise to an Event of
Default or Liens created by or existing from any litigation or legal
proceeding that are currently being contested in good faith by appropriate
proceedings and with respect to which adequate reserves are being
maintained in accordance with GAAP; and
(vi) easements, zoning restrictions, rights-of-way and similar
encumbrances on real property imposed by law or arising in the ordinary
course of business that do not secure any monetary obligations and do not
materially detract from the value of the affected property or materially
interfere with the ordinary conduct of business of the Borrower and its
Subsidiaries taken as a whole;
PROVIDED, that the term "Permitted Encumbrances" shall not include any Lien
securing Indebtedness.
"PERMITTED INVESTMENTS" shall mean:
(i) direct obligations of, or obligations the principal of and
interest on which are unconditionally guaranteed by, the United States (or
by any agency thereof to the extent such obligations are backed by the full
faith and credit of the United States), in each case maturing within one
year from the date of acquisition thereof;
(ii) marketable direct obligations issued by the District of Columbia
or any State of the United States or any political subdivision of any such
State or any public instrumentality therof maturing within one year from
the date of acquisition and, at the time of acquisition, having a long term
bond rating from S&P of at least AA or from Moody's of at least Aa2;
provided, that, the aggregate amount of Investments under this clause (ii)
shall not exceed $50,000,000 at any time;
13
(iii) commercial paper having the highest rating, at the time of
acquisition thereof, of S&P or Moody's and in either case maturing within
six months from the date of acquisition thereof;
(iv) certificates of deposit, bankers' acceptances and time deposits
maturing within 180 days of the date of acquisition thereof issued or
guaranteed by or placed with, and money market deposit accounts issued or
offered by, any domestic office of any commercial bank organized under the
laws of the United States or any state thereof which has a combined capital
and surplus and undivided profits of not less than $500,000,000;
(v) fully collateralized repurchase agreements with a term of not more
than 30 days for securities described in clause (i) above and entered into
with a financial institution satisfying the criteria described in clause
(iv) above; and
(vi) mutual funds investing solely in any one or more of the Permitted
Investments described in clauses (i) through (v) above.
"PERSON" shall mean any individual, partnership, firm, corporation,
association, joint venture, limited liability company, trust or other entity, or
any Governmental Authority.
"PLAN" shall mean any employee pension benefit plan (other than a
Multiemployer Plan) subject to the provisions of Title IV of ERISA or Section
412 of the Code or Section 302 of ERISA, and in respect of which the Borrower or
any ERISA Affiliate is (or, if such plan were terminated, would under Section
4069 of ERISA be deemed to be) an "employer" as defined in Section 3(5) of
ERISA.
"PRO RATA SHARE" shall mean, with respect to any Lender at any time, a
percentage, the numerator of which shall be the sum of such Lender's Revolving
Commitment and the denominator of which shall be the sum of all Lenders'
Revolving Commitments; or if the Revolving Commitments have been terminated or
expired or if the Loans have been declared to be due and payable, a percentage,
the numerator of which shall be the sum of such Lender's Revolving Credit
Exposure, and the denominator of which shall be the sum of the aggregate
Revolving Credit Exposure of all Lenders.
"REGULATION D" shall mean Regulation D of the Board of Governors of the
Federal Reserve System, as the same may be in effect from time to time, and any
successor regulations.
"RELATED PARTIES" shall mean, with respect to any specified Person, such
Person's Affiliates and the respective directors, officers, employees, agents
and advisors of such Person and such Person's Affiliates.
"RELEASE" shall mean any release, spill, emission, leaking, dumping,
injection, pouring, deposit, disposal, discharge, dispersal, leaching or
migration into the environment (including ambient air, surface water,
groundwater, land surface or subsurface strata) or within any building,
structure, facility or fixture.
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"REQUIRED LENDERS" shall mean, at any time, Lenders holding 51% or more of
the aggregate outstanding Revolving Credit Exposures at such time or if the
Lenders have no Revolving Credit Exposure outstanding, then Lenders holding 51%
or more of the Aggregate Revolving Commitments; provided, however, that (a) if
only two (2) Lenders exist hereunder, Required Lenders shall mean both such
Lenders and (b) if only three (3) Lenders exist hereunder, Required Lenders
shall mean both (i) the Lenders holding 51% or more of the aggregate outstanding
Revolving Credit Exposures at such time (or if the Lenders have no Revolving
Credit Exposure outstanding, then Lenders holding 51% or more of the Aggregate
Revolving Commitments) and (ii) at least two (2) of the three (3) Lenders.
"REQUIREMENT OF LAW" for any Person shall mean the articles or certificate
of incorporation, bylaws, partnership certificate and agreement, or limited
liability company certificate of organization and agreement, as the case may be,
and other organizational and governing documents of such Person, and any law,
treaty, rule or regulation, or determination of a Governmental Authority, in
each case applicable to or binding upon such Person or any of its property or to
which such Person or any of its property is subject.
"RESPONSIBLE OFFICER" shall mean any of the president, the chief executive
officer, the chief operating officer, the chief financial officer, the treasurer
or a vice president of the Borrower or such other representative of the Borrower
as may be designated in writing by any one of the foregoing with the consent of
the Administrative Agent; and, with respect to the financial covenants only, the
chief financial officer or the treasurer of the Borrower.
"REVOLVING COMMITMENT" shall mean, with respect to each Lender, the
obligation of such Lender to make Revolving Loans to the Borrower in an
aggregate principal amount not exceeding the amount set forth with respect to
such Lender on the signature pages to this Agreement, or in the case of a Person
becoming a Lender after the Closing Date, the amount of the assigned "Revolving
Commitment" as provided in the Assignment and Acceptance Agreement executed by
such Person as an assignee, as the same may be changed pursuant to terms hereof.
"REVOLVING CREDIT EXPOSURE" shall mean, with respect to any Lender at any
time, the sum of the outstanding principal amount of such Lender's Revolving
Loans.
"REVOLVING CREDIT NOTE" shall mean a promissory note of the Borrower
payable to the order of a requesting Lender in the principal amount of such
Lender's Revolving Commitment, in substantially the form of EXHIBIT A.
"REVOLVING LOAN" shall mean a loan made by a Lender to the Borrower under
its Revolving Commitment, which may either be a Base Rate Loan or a Eurodollar
Loan.
"S&P" shall mean Standard & Poor's.
"SUBSIDIARY" shall mean, with respect to any Person (the "PARENT"), any
corporation, partnership, joint venture, limited liability company, association
or other entity the accounts of which would be consolidated with those of the
parent in the parent's consolidated financial statements if such financial
15
statements were prepared in accordance with GAAP as of such date, as well as any
other corporation, partnership, joint venture, limited liability company,
association or other entity (i) of which securities or other ownership interests
representing more than 50% of the equity or more than 50% of the ordinary voting
power, or in the case of a partnership, more than 50% of the general partnership
interests are, as of such date, owned, Controlled or held, or (ii) that is, as
of such date, otherwise Controlled, by the parent or one or more subsidiaries of
the parent or by the parent and one or more subsidiaries of the parent. Unless
otherwise indicated, all references to "Subsidiary" hereunder shall mean a
Subsidiary of the Borrower.
"SUBSIDIARY GUARANTY AGREEMENT" shall mean the Subsidiary Guaranty
Agreement dated as of the date hereof and substantially in the form of EXHIBIT
C, made by the Subsidiaries of the Borrower listed on the signature pages
thereof in favor of the Administrative Agent for the benefit of the Lenders.
"SUBSIDIARY GUARANTY SUPPLEMENT" shall mean each supplement substantially
in the form of Annex I to the Subsidiary Guaranty Agreement executed and
delivered by a Subsidiary of the Borrower pursuant to SECTION 5.9.
"SUBSIDIARY LOAN PARTY" shall mean any Subsidiary that executes or
otherwise becomes a party to or bound by the Subsidiary Guaranty Agreement.
"SYNTHETIC LEASE" shall mean a lease transaction under which the parties
intend that (i) the lease will be treated as an "operating lease" by the lessee
pursuant to Statement of Financial Accounting Standards No. 13, as amended and
(ii) the lessee will be entitled to various tax and other benefits ordinarily
available to owners (as opposed to lessees) of like property.
"SYNTHETIC LEASE OBLIGATIONS" shall mean, with respect to any Person, the
sum of (i) all remaining rental obligations of such Person as lessee under
Synthetic Leases which are attributable to principal and, without duplication,
(ii) all rental and purchase price payment obligations of such Person under such
Synthetic Leases assuming such Person exercises the option to purchase the lease
property at the end of the lease term.
"TAXES" shall mean any and all present or future taxes, levies, imposts,
duties, deductions, charges or withholdings imposed by any Governmental
Authority.
"TYPE", when used in reference to a Loan or Borrowing, refers to whether
the rate of interest on such Loan, or on the Loans comprising such Borrowing, is
determined by reference to the Adjusted LIBO Rate or the Base Rate.
"WITHDRAWAL LIABILITY" shall mean liability to a Multiemployer Plan as a
result of a complete or partial withdrawal from such Multiemployer Plan, as such
terms are defined in Part I of Subtitle E of Title IV of ERISA.
SECTION 1.2 CLASSIFICATIONS OF LOANS AND BORROWINGS. For purposes of this
Agreement, Loans may be classified and referred to by Type (e.g. a "Eurodollar
Loan" or "Base Rate Loan" or "Revolving Eurodollar Loan"). Borrowings also may
be classified and referred to by Type (e.g. "Eurodollar Borrowing" or "
Revolving Eurodollar Borrowing").
16
SECTION 1.3 ACCOUNTING TERMS AND DETERMINATION. Unless otherwise defined
or specified herein, all accounting terms used herein shall be interpreted, all
accounting determinations hereunder shall be made, and all financial statements
required to be delivered hereunder shall be prepared, in accordance with GAAP as
in effect from time to time, applied on a basis consistent (except for such
changes approved by the Borrower's independent public accountants) with the most
recent audited consolidated financial statement of the Borrower delivered
pursuant to SECTION 5.1(A); PROVIDED, that if the Borrower notifies the
Administrative Agent that the Borrower wishes to amend any covenant in Article
VI to eliminate the effect of any change in GAAP on the operation of such
covenant (or if the Administrative Agent notifies the Borrower that the Required
Lenders wish to amend Article VI for such purpose), then the Borrower's
compliance with such covenant shall be determined on the basis of GAAP in effect
immediately before the relevant change in GAAP became effective, until either
such notice is withdrawn or such covenant is amended in a manner satisfactory to
the Borrower and the Required Lenders.
SECTION 1.4 TERMS GENERALLY. 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". In
the computation of periods of time from a specified date to a later specified
date, the word "from" means "from and including" and the word "to" means "to but
excluding". Unless the context requires otherwise (i) any definition of or
reference to any agreement, instrument or other document herein shall be
construed as referring to such agreement, instrument or other document as it was
originally executed or as it may from time to time be amended, restated,
supplemented or otherwise modified (subject to any restrictions on such
amendments, supplements or modifications set forth herein), (ii) any reference
herein to any Person shall be construed to include such Person's successors and
permitted assigns, (iii) the words "hereof", "herein" and "hereunder" and words
of similar import shall be construed to refer to this Agreement as a whole and
not to any particular provision hereof, (iv) all references to Articles,
Sections, Exhibits and Schedules shall be construed to refer to Articles,
Sections, Exhibits and Schedules to this Agreement and (v) all references to a
specific time shall be construed to refer to the time in the city and state of
the Administrative Agent's principal office, unless otherwise indicated.
ARTICLE II
AMOUNT AND TERMS OF THE REVOLVING COMMITMENTS
---------------------------------------------
SECTION 2.1 GENERAL DESCRIPTION OF FACILITIES. Subject to and upon the
terms and conditions herein set forth, the Lenders hereby establish in favor of
the Borrower a revolving credit facility pursuant to which the Lenders severally
agree (to the extent of each Lender's Pro Rata Share up to such Lender's
Revolving Commitment) to make Revolving Loans to the Borrower in accordance with
SECTION 2.2; PROVIDED, that in no event shall the aggregate principal amount of
all outstanding Revolving Loans exceed at any time the Aggregate Revolving
Commitments from time to time in effect.
17
SECTION 2.2 REVOLVING LOANS. Subject to the terms and conditions set forth
herein, each Lender severally agrees to make Revolving Loans to the Borrower,
from time to time during the Availability Period, in an aggregate principal
amount outstanding at any time that will not result in (a) such Lender's
Revolving Credit Exposure exceeding such Lender's Revolving Commitment or (b)
the sum of the aggregate Revolving Credit Exposures of all Lenders exceeding the
Aggregate Revolving Commitments. During the Availability Period, the Borrower
shall be entitled to borrow, prepay and reborrow Revolving Loans in accordance
with the terms and conditions of this Agreement; PROVIDED, that the Borrower may
not borrow or reborrow should there exist a Default or Event of Default.
SECTION 2.3 PROCEDURE FOR REVOLVING BORROWINGS.
The Borrower shall give the Administrative Agent written notice (or
telephonic notice promptly confirmed in writing) of each Revolving Borrowing
substantially in the form of Exhibit 2.3 attached hereto (a "NOTICE OF REVOLVING
BORROWING") (x) prior to 11:00 a.m. (Atlanta, Georgia time) one (1) Business Day
prior to the requested date of each Base Rate Borrowing and (y) prior to 11:00
a.m. (Atlanta, Georgia time) three (3) Business Days prior to the requested date
of each Eurodollar Borrowing. Each Notice of Revolving Borrowing shall be
irrevocable and shall specify: (i) the aggregate principal amount of such
Borrowing, (ii) the date of such Borrowing (which shall be a Business Day),
(iii) the Type of such Revolving Loan comprising such Borrowing and (iv) in the
case of a Eurodollar Borrowing, the duration of the initial Interest Period
applicable thereto (subject to the provisions of the definition of Interest
Period). Each Revolving Borrowing shall consist entirely of Base Rate Loans or
Eurodollar Loans, as the Borrower may request. The aggregate principal amount of
each Borrowing shall be not less than $1,000,000 or a larger multiple of
$100,000. At no time shall the total number of Eurodollar Borrowings outstanding
at any time exceed six. Promptly following the receipt of a Notice of Revolving
Borrowing in accordance herewith, the Administrative Agent shall advise each
Lender of the details thereof and the amount of such Lender's Revolving Loan to
be made as part of the requested Revolving Borrowing.
SECTION 2.4 FUNDING OF BORROWINGS.
(a) Each Lender will make available each Loan to be made by it hereunder on
the proposed date thereof by wire transfer in immediately available funds by
1:00 p.m. (Atlanta, Georgia time) to the Administrative Agent at the Payment
Office. The Administrative Agent will make such Loans available to the Borrower
by promptly crediting the amounts that it receives, in like funds by the close
of business on such proposed date, to an account maintained by the Borrower with
the Administrative Agent or at the Borrower's option, by effecting a wire
transfer of such amounts to an account designated by the Borrower to the
Administrative Agent.
(b) Unless the Administrative Agent shall have been notified by any Lender
prior to 5:00 p.m. (Atlanta, Georgia time) one (1) Business Day prior to the
date of a Borrowing in which such Lender is participating 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
amount available to the Administrative Agent on such date, and the
Administrative Agent, in reliance on such assumption, may make available to the
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Borrower on such date a corresponding amount. If such corresponding amount is
not in fact made available to the Administrative Agent by such Lender on the
date of such Borrowing, the Administrative Agent shall be entitled to recover
such corresponding amount on demand from such Lender together with interest at
the Federal Funds Rate for up to two (2) days and thereafter at the rate
specified for such Borrowing. If such Lender does not pay such corresponding
amount forthwith upon the Administrative Agent's demand therefor, the
Administrative Agent shall promptly notify the Borrower, and the Borrower shall
immediately pay such corresponding amount to the Administrative Agent together
with interest at the rate specified for such Borrowing. Nothing in this
subsection shall be deemed to relieve any Lender from its obligation to fund its
Pro Rata Share of any Borrowing hereunder or to prejudice any rights which the
Borrower may have against any Lender as a result of any default by such Lender
hereunder.
(c) All Revolving Borrowings shall be made by the Lenders on the basis of
their respective Pro Rata Shares. No Lender shall be responsible for any default
by any other Lender in its obligations hereunder, and each Lender shall be
obligated to make its Loans provided to be made by it hereunder, regardless of
the failure of any other Lender to make its Loans hereunder.
SECTION 2.5 INTEREST ELECTIONS.
(a) Each Borrowing initially shall be of the Type specified in the
applicable Notice of Borrowing, and in the case of a Eurodollar Borrowing, shall
have an initial Interest Period as specified in such Notice of Borrowing.
Thereafter, the Borrower may elect to convert such Borrowing into a different
Type or to continue such Borrowing, and in the case of a Eurodollar Borrowing,
may elect Interest Periods therefor, all as provided in this Section. The
Borrower may elect different options with respect to different portions of the
affected Borrowing, in which case each such portion shall be allocated ratably
among the Lenders holding Loans comprising such Borrowing, and the Loans
comprising each such portion shall be considered a separate Borrowing.
(b) To make an election pursuant to this Section, the Borrower shall give
the Administrative Agent prior written notice (or telephonic notice promptly
confirmed in writing) of each Borrowing substantially in the form of Exhibit 2.5
(a "NOTICE OF CONVERSION/CONTINUATION") that is to be converted or continued, as
the case may be, (x) prior to 10:00 a.m. (Atlanta, Georgia time) one (1)
Business Day prior to the requested date of a conversion into a Base Rate
Borrowing and (y) prior to 11:00 a.m. (Atlanta, Georgia time) three (3) Business
Days prior to a continuation of or conversion into a Eurodollar Borrowing. Each
such Notice of Conversion/Continuation shall be irrevocable and shall specify
(i) the Borrowing to which such Notice of Continuation/Conversion applies and if
different options are being elected with respect to different portions thereof,
the portions thereof that are to be allocated to each resulting Borrowing (in
which case the information to be specified pursuant to clauses (iii) and (iv)
shall be specified for each resulting Borrowing); (ii) the effective date of the
election made pursuant to such Notice of Continuation/Conversion, which shall be
a Business Day, (iii) whether the resulting Borrowing is to be a Base Rate
Borrowing or a Eurodollar Borrowing; and (iv) if the resulting Borrowing is to
be a Eurodollar Borrowing, the Interest Period applicable thereto after giving
effect to such election, which shall be a period contemplated by the definition
of "Interest Period". If any such Notice of Continuation/Conversion requests a
Eurodollar Borrowing but does not specify an Interest Period, the Borrower shall
be deemed to have selected an Interest Period of one month. The principal amount
of any resulting Borrowing shall satisfy the minimum borrowing amount for
Eurodollar Borrowings and Base Rate Borrowings set forth in SECTION 2.3.
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(c) If, on the expiration of any Interest Period in respect of any
Eurodollar Borrowing, the Borrower shall have failed to deliver a Notice of
Conversion/ Continuation, then, unless such Borrowing is repaid as provided
herein, the Borrower shall be deemed to have elected to convert such Borrowing
to a Base Rate Borrowing. No Borrowing may be converted into, or continued as, a
Eurodollar Borrowing if a Default or an Event of Default exists, unless the
Administrative Agent and each of the Lenders shall have otherwise consented in
writing. No conversion of any Eurodollar Loans shall be permitted except on the
last day of the Interest Period in respect thereof.
(d) Upon receipt of any Notice of Conversion/Continuation, the
Administrative Agent shall promptly notify each Lender of the details thereof
and of such Lender's portion of each resulting Borrowing.
SECTION 2.6 OPTIONAL REDUCTION AND TERMINATION OF REVOLVING COMMITMENTS.
(a) Unless previously terminated, all Revolving Commitments shall terminate
on the Commitment Termination Date.
(b) Upon at least three (3) Business Days' prior written notice (or
telephonic notice promptly confirmed in writing) to the Administrative Agent
(which notice shall be irrevocable), the Borrower may reduce the Aggregate
Revolving Commitments in part or terminate the Aggregate Revolving Commitments
in whole; PROVIDED, that (i) any partial reduction shall apply to reduce
proportionately and permanently the Revolving Commitment of each Lender, (ii)
any partial reduction pursuant to this SECTION 2.6 shall be in an amount of at
least $5,000,000 and any larger multiple of $1,000,000, and (iii) no such
reduction shall be permitted which would reduce the Aggregate Revolving
Commitments to an amount less than the outstanding Revolving Credit Exposures of
all Lenders.
SECTION 2.7 REPAYMENT OF LOANS. The outstanding principal amount of all
Revolving Loans shall be due and payable (together with accrued and unpaid
interest thereon) on the Commitment Termination Date.
SECTION 2.8 EVIDENCE OF INDEBTEDNESS. (a) Each Lender shall maintain in
accordance with its usual practice appropriate records evidencing the
Indebtedness of the Borrower to such Lender resulting from each Loan made by
such Lender from time to time, including the amounts of principal and interest
payable thereon and paid to such Lender from time to time under this Agreement.
The Administrative Agent shall maintain appropriate records in which shall be
recorded (i) the Revolving Commitment of each Lender, (ii) the amount of each
Loan made hereunder by each Lender, the Type thereof and the Interest Period
applicable thereto, (iii) the date of each continuation thereof pursuant to
SECTION 2.5, (iv) the date of each conversion of all or a portion thereof to
another Type pursuant to SECTION 2.5, (v) the date and amount of any principal
or interest due and payable or to become due and payable from the Borrower to
each Lender hereunder in respect of such Loans and (vi) both the date and amount
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of any sum received by the Administrative Agent hereunder from the Borrower in
respect of the Loans and each Lender's Pro Rata Share thereof. The entries made
in such records shall be prima facie evidence of the existence and amounts of
the obligations of the Borrower therein recorded; PROVIDED, that the failure or
delay of any Lender or the Administrative Agent in maintaining or making entries
into any such record or any error therein shall not in any manner affect the
obligation of the Borrower to repay the Loans (both principal and unpaid accrued
interest) of such Lender in accordance with the terms of this Agreement.
(b) At the request of any Lender at any time, the Borrower agrees that it
will execute and deliver to such Lender a Revolving Credit Note payable to the
order of such Lender, and such Lender agrees, upon receipt of such new Note and
request of the Borrower, such Lender will promptly cancel and return any Note
replaced by such new Note to the Borrower.
SECTION 2.9 OPTIONAL PREPAYMENTS.
The Borrower shall have the right at any time and from time to time to
prepay any Borrowing, in whole or in part, without premium or penalty, by giving
irrevocable written notice (or telephonic notice promptly confirmed in writing)
to the Administrative Agent no later than (i) in the case of prepayment of any
Eurodollar Borrowing, 11:00 a.m. (Atlanta, Georgia time) not less than three (3)
Business Days prior to any such prepayment and (ii) in the case of any
prepayment of any Base Rate Borrowing, not less than one Business Day prior to
the date of such prepayment. Each such notice shall be irrevocable and shall
specify the proposed date of such prepayment and the principal amount of each
Borrowing or portion thereof to be prepaid. Upon receipt of any such notice, the
Administrative Agent shall promptly notify each affected Lender of the contents
thereof and of such Lender's Pro Rata Share of any such prepayment. If such
notice is given, the aggregate amount specified in such notice shall be due and
payable on the date designated in such notice, together with accrued interest to
such date on the amount so prepaid in accordance with SECTION 2.11(C); PROVIDED,
that if a Eurodollar Borrowing is prepaid on a date other than the last day of
an Interest Period applicable thereto, the Borrower shall also pay all amounts
required pursuant to SECTION 2.17. Each partial prepayment of any Loan shall be
in an amount that would be permitted in the case of an advance of a Revolving
Borrowing of the same Type pursuant to SECTION 2.3. Each prepayment of a
Borrowing shall be applied ratably to the Loans comprising such Borrowing.
SECTION 2.10 MANDATORY PREPAYMENTS.
If at any time the Revolving Credit Exposure of all Lenders exceeds
the Aggregate Revolving Commitments, as reduced pursuant to SECTION 2.6 or
otherwise, the Borrower shall immediately, jointly and severally, repay
Revolving Loans in an amount equal to such excess, together with all accrued and
unpaid interest on such excess amount and any amounts due under SECTION 2.17.
Each prepayment shall be applied first to the Base Rate Loans to the full extent
thereof, and next to Eurodollar Loans to the full extent thereof.
SECTION 2.11 INTEREST ON LOANS.
(a) The Borrower shall pay interest on each Base Rate Loan at the Base Rate
in effect from time to time. The Borrower shall pay interest on each Eurodollar
Loan at the Adjusted LIBO Rate for the applicable Interest Period in effect for
such Loan plus 1.50%.
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(b) While an Event of Default exists or after acceleration, at the option
of the Required Lenders, the Borrower shall pay interest ("DEFAULT INTEREST")
with respect to all Eurodollar Loans at the rate otherwise applicable for the
then-current Interest Period plus an additional 2% per annum until the last day
of such Interest Period, and thereafter, and with respect to all Base Rate Loans
and all other Obligations hereunder (other than Loans), at an all-in rate in
effect for Base Rate Loans, plus an additional 3.5% per annum.
(c) Interest on the principal amount of all Loans shall accrue from and
including the date such Loans are made to but excluding the date of any
repayment thereof. Interest on all outstanding Base Rate Loans shall be payable
monthly in arrears on the last day of each calendar month and on the Commitment
Termination Date. Interest on all outstanding Eurodollar Loans shall be payable
on the last day of each Interest Period applicable thereto, and, in the case of
any Eurodollar Loans having an Interest Period in excess of three months on each
day which occurs every three months after the initial date of such Interest
Period, and on the Commitment Termination Date. Interest on any Loan which is
converted into a Loan of another Type or which is repaid or prepaid shall be
payable on the date of such conversion or on the date of any such repayment or
prepayment (on the amount repaid or prepaid) thereof. All Default Interest shall
be payable on demand.
(d) The Administrative Agent shall determine each interest rate applicable
to the Loans hereunder and shall promptly notify the Borrower and the Lenders of
such rate in writing (or by telephone, promptly confirmed in writing). Any such
determination shall be conclusive and binding for all purposes, absent manifest
error.
SECTION 2.12 FEES.
(a) The Borrower shall pay to the Administrative Agent and SunTrust Capital
Markets, Inc., as Lead Arranger, for their own respective account, the fees
agreed upon pursuant to and in accordance with that certain fee letter dated
August 3, 2004 among the Borrower, the Administrative Agent and SunTrust Capital
Markets, Inc., as Lead Arranger.
(b) The Borrower agrees to pay to the Administrative Agent for the account
of each Lender a commitment fee, which shall accrue at one quarter of one
percent (.25%) per annum, on the daily amount of the unused Revolving Commitment
of such Lender during the Availability Period; PROVIDED, that if such Lender
continues to have any Revolving Credit Exposure after the Commitment Termination
Date, then the commitment fee shall continue to accrue on the amount of such
Lender's unused Revolving Commitment from and after the Commitment Termination
Date to the date that all of such Lender's Revolving Credit Exposure has been
paid in full. Accrued commitment fees shall be payable in arrears on the last
day of each March, June, September and December of each year and on the
Commitment Termination Date, commencing on the first such date after the Closing
Date; PROVIDED FURTHER, that any commitment fees accruing after the Commitment
Termination Date shall be payable on demand. For purposes of computing
commitment fees with respect to the Revolving Commitments, the Revolving
Commitment of each Lender shall be deemed used to the extent of the outstanding
Revolving Loans of such Lender.
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(c) Accrued fees shall be payable quarterly in arrears on the last day of
each March, June, September and December, commencing on December 31, 2004 and on
the Commitment Termination Date.
SECTION 2.13 COMPUTATION OF INTEREST AND FEES.
Interest based on the Base Rate hereunder shall be computed on the basis
of a year of 365 days (or 366 days in a leap year) and paid for the actual
number of days elapsed (including the first day but excluding the last day). All
other interest and all fees shall be computed on the basis of a year of 360 days
and paid for the actual number of days elapsed (including the first day but
excluding the last day). Each determination by the Administrative Agent of an
interest amount or fee hereunder shall be made in good faith and, except for
manifest error, shall be final, conclusive and binding for all purposes.
SECTION 2.14 INABILITY TO DETERMINE INTEREST RATES. If prior to the
commencement of any Interest Period for any Eurodollar Borrowing,
(i) the Administrative Agent shall have determined (which
determination shall be conclusive and binding upon the Borrower)
that, by reason of circumstances affecting the relevant interbank
market, adequate means do not exist for ascertaining LIBOR for
such Interest Period, or
(ii) the Administrative Agent shall have received notice
from the Required Lenders that the Adjusted LIBO Rate does not
adequately and fairly reflect the cost to such Lenders (or
Lender, as the case may be) of making, funding or maintaining
their (or its, as the case may be) Eurodollar Loans for such
Interest Period,
the Administrative Agent shall give written notice (or telephonic notice,
promptly confirmed in writing) to the Borrower and to the Lenders as soon as
practicable thereafter. In the case of Eurodollar Loans, until the
Administrative Agent shall notify the Borrower and the Lenders that the
circumstances giving rise to such notice no longer exist, (i) the obligations of
the Lenders to make Eurodollar Revolving Loans or to continue or convert
outstanding Loans as or into Eurodollar Loans shall be suspended and (ii) all
such affected Loans shall be converted into Base Rate Loans on the last day of
the then current Interest Period applicable thereto unless the Borrower prepays
such Loans in accordance with this Agreement. Unless the Borrower notifies the
Administrative Agent at least one Business Day before the date of any Eurodollar
Revolving Borrowing for which a Notice of Revolving Borrowing has previously
been given that it elects not to borrow on such date, then such Revolving
Borrowing shall be made as a Base Rate Borrowing.
SECTION 2.15 ILLEGALITY. If any Change in Law shall make it unlawful or
impossible for any Lender to make, maintain or fund any Eurodollar Loan and such
Lender shall so notify the Administrative Agent, the Administrative Agent shall
promptly give notice thereof to the Borrower and the other Lenders, whereupon
until such Lender notifies the Administrative Agent and the Borrower that the
circumstances giving rise to such suspension no longer exist, the obligation of
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such Lender to make Eurodollar Revolving Loans, or to continue or convert
outstanding Loans as or into Eurodollar Loans, shall be suspended. In the case
of the making of a Eurodollar Revolving Borrowing, such Lender's Revolving Loan
shall be made as a Base Rate Loan as part of the same Revolving Borrowing for
the same Interest Period and if the affected Eurodollar Loan is then
outstanding, such Loan shall be converted to a Base Rate Loan either (i) on the
last day of the then current Interest Period applicable to such Eurodollar Loan
if such Lender may lawfully continue to maintain such Loan to such date or (ii)
immediately if such Lender shall determine that it may not lawfully continue to
maintain such Eurodollar Loan to such date. Notwithstanding the foregoing, the
affected Lender shall, prior to giving such notice to the Administrative Agent,
designate a different Applicable Lending Office if such designation would avoid
the need for giving such notice and if such designation would not otherwise be
disadvantageous to such Lender in the good faith exercise of its discretion.
SECTION 2.16 INCREASED COSTS.
(a) If any Change in Law shall:
(i) impose, modify or deem applicable any reserve, special
deposit or similar requirement that is not otherwise included in the
determination of the Adjusted LIBO Rate hereunder against assets of,
deposits with or for the account of, or credit extended by, any Lender
(except any such reserve requirement reflected in the Adjusted LIBO
Rate); or
(ii) impose on any Lender or the eurodollar interbank market any
other condition affecting this Agreement or any Eurodollar Loans made
by such Lender;
and the result of the foregoing is to increase the cost to such Lender of
making, converting into, continuing or maintaining a Eurodollar Loan or to
reduce the amount received or receivable by such Lender hereunder (whether of
principal, interest or any other amount), then the Borrower shall promptly pay,
upon written notice from and demand by such Lender on the Borrower (with a copy
of such notice and demand to the Administrative Agent), to the Administrative
Agent for the account of such Lender, within five Business Days after the date
of such notice and demand, additional amount or amounts sufficient to compensate
such Lender for such additional costs incurred or reduction suffered.
(b) If any Lender shall have determined that on or after the date of
this Agreement any Change in Law regarding capital requirements has or would
have the effect of reducing the rate of return on such Lender's capital (or on
the capital of such Lender's holding company) as a consequence of its
obligations hereunder to a level below that which such Lender or such Lender's
holding company could have achieved but for such Change in Law (taking into
consideration such Lender's policies or the policies of such Lender's holding
company with respect to capital adequacy) then, from time to time, within five
(5) Business Days after receipt by the Borrower of written demand by such Lender
(with a copy thereof to the Administrative Agent), the Borrower shall pay to
such Lender such additional amounts as will compensate such Lender or such
Lender's holding company for any such reduction suffered.
24
(c) A certificate of a Lender setting forth the amount or amounts
necessary to compensate such Lender or such Lender's holding company, as the
case may be, specified in paragraph (a) or (b) of this Section shall be
delivered to the Borrower (with a copy to the Administrative Agent) and shall be
conclusive, absent manifest error. The Borrower shall pay any such Lender such
amount or amounts within 10 days after receipt thereof.
(d) Failure or delay on the part of any Lender to demand
compensation pursuant to this Section shall not constitute a waiver of such
Lender's right to demand such compensation PROVIDED, that the Borrower shall not
be required to compensate a Lender under this Section for any increased costs or
reductions incurred more than six (6) months prior to the date that such Lender
notifies the Borrower of such increased costs or reductions and of such Lender's
intention to claim compensation therefor; PROVIDED FURTHER, that if the Change
in Law giving rise to such increased costs or reductions is retroactive, then
such six-month period shall be extended to include the period of such
retroactive effect.
SECTION 2.17 FUNDING INDEMNITY. In the event of (a) the payment of any
principal of a Eurodollar Loan other than on the last day of the Interest Period
applicable thereto (including as a result of an Event of Default), (b) the
conversion or continuation of a Eurodollar Loan other than on the last day of
the Interest Period applicable thereto, or (c) the failure by the Borrower to
borrow, prepay, convert or continue any Eurodollar Loan on the date specified in
any applicable notice (regardless of whether such notice is withdrawn or
revoked), then, in any such event, the Borrower shall compensate each Lender,
within five (5) Business Days after written demand from such Lender, for any
loss, cost or expense attributable to such event. In the case of a Eurodollar
Loan, such loss, cost or expense shall be deemed to include an amount determined
by such Lender to be the excess, if any, of (A) the amount of interest that
would have accrued on the principal amount of such Eurodollar Loan if such event
had not occurred at the Adjusted LIBO Rate applicable to such Eurodollar Loan
for the period from the date of such event to the last day of the then current
Interest Period therefor (or in the case of a failure to borrow, convert or
continue, for the period that would have been the Interest Period for such
Eurodollar Loan) over (B) the amount of interest that would accrue on the
principal amount of such Eurodollar Loan for the same period if the Adjusted
LIBO Rate were set on the date such Eurodollar Loan was prepaid or converted or
the date on which the Borrower failed to borrow, convert or continue such
Eurodollar Loan. A certificate as to any additional amount payable under this
SECTION 2.17 submitted to the Borrower by any Lender shall be conclusive, absent
manifest error.
SECTION 2.18 TAXES.
(a) Any and all payments by or on account of any obligation of the
Borrower hereunder shall be made free and clear of and without deduction for any
Indemnified Taxes or Other Taxes; PROVIDED, that if the Borrower shall be
required to deduct any Indemnified Taxes or 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 or any Lender (as the case may be)
shall receive an amount equal to the sum it would have received had no such
deductions been made, (ii) the Borrower shall make such deductions and (iii) the
Borrower shall pay the full amount deducted to the relevant Governmental
Authority in accordance with applicable law.
25
(b) In addition, the Borrower shall pay any Other Taxes to the
relevant Governmental Authority in accordance with applicable law.
(c) The Borrower shall indemnify the Administrative Agent and each
Lender, within five (5) Business Days after written demand therefor, for the
full amount of any Indemnified Taxes or Other Taxes paid by the Administrative
Agent or such Lender, as the case may be, on or with respect to any payment by
or on account of any obligation of the Borrower hereunder (including Indemnified
Taxes or Other Taxes imposed or asserted on or attributable to amounts payable
under this Section) and any penalties, interest and reasonable expenses arising
therefrom or with respect thereto, 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 or
liability delivered to the Borrower by a Lender or by the Administrative Agent
on its own behalf or on behalf of a Lender, shall be conclusive absent manifest
error.
(d) As soon as practicable after any payment of Indemnified Taxes or
Other Taxes by the Borrower to a Governmental Authority, the 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.
(e) Any Foreign Lender that is entitled to an exemption from or
reduction of withholding tax under the Code, or any treaty to which the United
States is a party, with respect to payments under this Agreement shall deliver
to the Borrower (with a copy to the Administrative Agent), at the time or times
prescribed by applicable law, such properly completed and executed documentation
prescribed by applicable law or reasonably requested by the Borrower as will
permit such payments to be made without withholding or at a reduced rate.
Without limiting the generality of the foregoing, each Foreign Lender agrees
that it will deliver to the Administrative Agent and the Borrower (or in the
case of a Participant, to the Lender from which the related participation shall
have been purchased) two (2) duly completed copies of (i) Internal Revenue
Service Form W-8 ECI, or any successor form thereto, certifying that the
payments received from the Borrower hereunder are effectively connected with
such Foreign Lender's conduct of a trade or business in the United States or
(ii) Internal Revenue Service Form W-8 BEN, or any successor form thereto,
certifying that such Foreign Lender is entitled to benefits under an income tax
treaty to which the Untied States is a party which reduces the rate of
withholding tax on payments of interest or (iii) Internal Revenue Service Form
W-8 BEN, or any successor form prescribed by the Internal Revenue Service,
together with a certificate (A) establishing that the payment to the Foreign
Lender qualifies as "portfolio interest" exempt from U.S. withholding tax under
Code section 871(h) or 881(c), and (B) stating that (1) the Foreign Lender is
not a bank for purposes of Code section 881(c)(3)(A), OR the obligation of the
Borrower hereunder is not, with respect to such Foreign Lender, a loan agreement
entered into in the ordinary course of its trade or business, within the meaning
of that section; (2) the Foreign Lender is not a 10% shareholder of the Borrower
within the meaning of Code section 871(h)(3) or 881(c)(3)(B); and (3) the
Foreign Lender is not a controlled foreign corporation that is related to the
Borrower within the meaning of Code section 881(c)(3)(C); or (iv) such other
Internal Revenue Service forms as may be applicable to the Foreign Lender,
including Forms W-8 IMY or W-8 EXP. Each such Foreign Lender shall deliver to
the Borrower and the Administrative Agent such forms on or before the date that
it becomes a party to this Agreement (or in the case of a Participant, on or
26
before the date such Participant purchases the related participation). In
addition, each such Lender shall deliver such forms promptly upon the
obsolescence or invalidity of any form previously delivered by such Lender. Each
such Lender shall promptly notify the Borrower and the Administrative Agent at
any time that it determines that it is no longer in a position to provide any
previously delivered certificate to the Borrower (or any other form of
certification adopted by the Internal Revenue Service for such purpose).
SECTION 2.19 PAYMENTS GENERALLY; PRO RATA TREATMENT; SHARING OF SET-OFFS.
(a) The Borrower shall make each payment required to be made by it
hereunder (whether of principal, interest or fees, or of amounts payable under
SECTION 2.16, 2.17 or 2.18, or otherwise) prior to 1:00 p.m. (Atlanta, Georgia
time), on the date when due, in immediately available funds, free and clear of
any defenses, rights of set-off, counterclaim or withholding or deduction of
taxes. Any amounts received after such time on any date may, in the discretion
of the Administrative Agent, be deemed to have been received on the next
succeeding Business Day for purposes of calculating interest thereon. All such
payments shall be made to the Administrative Agent at the Payment Office, except
that payments pursuant to SECTIONS 2.16, 2.7 and 2.18 and 10.3 shall be made
directly to the Persons entitled thereto. The Administrative Agent shall
distribute any such payments received by it for the account of any other Person
to the appropriate recipient promptly following receipt thereof. If any payment
hereunder shall be due on a day that is not a Business Day, the date for payment
shall be extended to the next succeeding Business Day, and, in the case of any
payment accruing interest, interest thereon shall be made payable for the period
of such extension. All payments hereunder shall be made in Dollars.
(b) If at any time insufficient funds are received by and available
to the Administrative Agent to pay fully all amounts of principal, interest and
fees then due hereunder, such funds shall be applied (i) first, towards payment
of interest and fees then due hereunder, ratably among the parties entitled
thereto in accordance with the amounts of interest and fees then due to such
parties, and (ii) second, towards payment of principal then due hereunder,
ratably among the parties entitled thereto in accordance with the amounts of
principal then due to such parties.
(c) If any Lender shall, by exercising any right of set-of or
counterclaim or otherwise, obtain payment in respect of any principal of or
interest on any of its Revolving Loans that would result in such Lender
receiving payment of a greater proportion of the aggregate amount of its
Revolving Loans and accrued interest thereon than the proportion received by any
other Lender, then the Lender receiving such greater proportion shall purchase
(for cash at face value) participations in the Revolving Loans of other Lenders
to the extent necessary 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 Revolving Loans PROVIDED, that (i) if
any such participations are purchased and all or any portion of the payment
giving rise thereto is recovered, such participations shall be rescinded and the
purchase price restored to the extent of such recovery, without interest, and
(ii) the provisions of this paragraph shall not be construed to apply to any
payment made by the Borrower pursuant to and in accordance with the express
terms of this Agreement or any payment obtained by a Lender as consideration for
the assignment of or sale of a participation in any of its Loans to any assignee
or participant, other than to the Borrower or any Subsidiary or Affiliate
27
thereof (as to which the provisions of this paragraph shall apply). The Borrower
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 the Borrower rights of set-off and
counterclaim with respect to such participation as fully as if such Lender were
a direct creditor of the Borrower in the amount of such participation.
(d) Unless the Administrative Agent shall have received notice from
the Borrower prior to the date on which any payment is due to the Administrative
Agent for the account of the Lenders hereunder that the Borrower will not make
such payment, the Administrative Agent may assume that the Borrower has made
such payment on such date in accordance herewith and may, in reliance upon such
assumption, distribute to the Lenders the amount or amounts due. In such event,
if the Borrower has not in fact made such payment, then each of the Lenders
severally agrees to repay to the Administrative Agent forthwith on demand the
amount so distributed to such Lender 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
Effective Rate and a rate determined by the Administrative Agent in accordance
with banking industry rules on interbank compensation.
(e) If any Lender shall fail to make any payment required to be made
by it pursuant to SECTION 2.5(B) or 10.3(D), then the Administrative Agent may,
in its discretion (notwithstanding any contrary provision hereof), apply any
amounts thereafter received by the Administrative Agent for the account of such
Lender to satisfy such Lender's obligations under such Sections until all such
unsatisfied obligations are fully paid.
SECTION 2.20 INCREASE OF REVOLVING COMMITMENTS; ADDITIONAL LENDERS. (a) So
long as no Event of Default has occurred and is continuing, from time to time
after the Closing Date, the Borrower may, upon at least 30 days' written notice
to the Administrative Agent (who shall promptly notify the Lenders thereof),
propose to increase the Aggregate Revolving Commitments by an amount of up to
$20,000,000 (the amount of any such increase, the "ADDITIONAL REVOLVING
COMMITMENT AMOUNT"); PROVIDED, that the Aggregate Revolving Commitments shall
not at any time exceed $50,000,000. Each Lender shall have the right for a
period of 15 days following receipt of such notice, to elect by written notice
to the Borrower and the Administrative Agent to increase its Revolving
Commitment by a principal amount equal to its Pro Rata Share of the Additional
Revolving Commitment Amount. No Lender (or any successor thereto) shall have any
obligation to increase its Revolving Commitment or its other obligations under
this Agreement and the other Loan Documents, and any decision by a Lender to
increase its Revolving Commitment shall be made in its sole discretion
independently from any other Lender.
(b) If any Lender shall elect not to increase its Revolving
Commitment pursuant to subsection (a) of this Section, the Borrower may
designate another bank or other financial institution (which may be, but need
not be, one or more of the existing Lenders) which at the time agrees to, in the
case of any such Person that is an existing Lender, increase its Revolving
Commitment and in the case of any other such Person (an "ADDITIONAL LENDER"),
become a party to this Agreement; PROVIDED, HOWEVER, that any new bank or
financial institution must be acceptable to the Administrative Agent, which
acceptance will not be unreasonably withheld or delayed. The sum of the
increases in the Revolving Commitments of the existing Lenders pursuant to this
subsection (b) plus the Revolving Commitments of the Additional Lenders shall
not in the aggregate exceed the unsubscribed amount of the Additional Revolving
Commitment Amount.
28
(c) An increase in the Aggregate Revolving Commitments pursuant to
this Section shall become effective upon the receipt by the Administrative Agent
of an agreement in form and substance satisfactory to the Administrative Agent
signed by the Borrower, by each Additional Lender and by each other Lender whose
Revolving Commitment is to be increased, setting forth the new Revolving
Commitments of such Lenders and setting forth the agreement of each Additional
Lender to become a party to this Agreement and to be bound by all the terms and
provisions hereof, together with such evidence of appropriate corporate
authorization on the part of the Borrower with respect to the increase in the
Revolving Commitments and such opinions of counsel for the Borrower with respect
to the increase in the Revolving Commitments as the Administrative Agent may
reasonably request.
(d) Upon the acceptance of any such agreement by the Administrative
Agent, the Aggregate Revolving Commitments shall automatically be increased by
the amount of the Revolving Commitments added through such agreement and ANNEX I
shall automatically be deemed amended to reflect the Revolving Commitments of
all Lenders after giving effect to the addition of such Revolving Commitments.
(e) Upon any increase in the aggregate amount of the Revolving
Commitments pursuant to this Section that is not pro rata among all Lenders,
within five Business Days, in the case of any Base Rate Loans then outstanding,
and at the end of the then current Interest Period with respect thereto, in the
case of any Eurodollar Loans then outstanding, the Borrower shall prepay such
Loans in their entirety and, to the extent the Borrower elects to do so and
subject to the conditions specified in Article III, the Borrower shall reborrow
Loans from the Lenders in proportion to their respective Revolving Commitments
after giving effect to such increase, until such time as all outstanding Loans
are held by the Lenders in such proportion.
SECTION 2.21 MITIGATION OF OBLIGATIONS. If any Lender requests
compensation under SECTION 2.16, or if the Borrower is required to pay any
additional amount to any Lender or any Governmental Authority for the account of
any Lender pursuant to SECTION 2.18, 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 sole judgment of such Lender, such
designation or assignment (i) would eliminate or reduce amounts payable under
SECTION 2.16 or SECTION 2.18, as the case may be, in the future and (ii) would
not subject such Lender to any unreimbursed cost or expense and would not
otherwise be disadvantageous to such Lender. The Borrower hereby agrees to pay
all reasonable costs and expenses incurred by any Lender in connection with such
designation or assignment.
29
ARTICLE III
CONDITIONS PRECEDENT TO LOANS
-----------------------------
SECTION 3.1 CONDITIONS TO EFFECTIVENESS. The obligations of the Lenders to
make Loans hereunder shall not become effective until the date on which each of
the following conditions is satisfied (or waived in accordance with SECTION
10.2).
(a) The Administrative Agent shall have received all fees and other
amounts due and payable on or prior to the Closing Date, including reimbursement
or payment of all out-of-pocket expenses (including reasonable fees, charges and
disbursements of counsel to the Administrative Agent) required to be reimbursed
or paid by the Borrower hereunder, under any other Loan Document and under any
agreement with the Administrative Agent or SunTrust Capital Markets, Inc., as
Lead Arranger.
(b) The Administrative Agent (or its counsel) shall have received
the following each in form and substance satisfactory to the Agent:
(i) a counterpart of this Agreement signed by or on behalf of
each party thereto or written evidence satisfactory to the
Administrative Agent (which may include telecopy transmission of a
signed signature page of this Agreement) that such party has signed a
counterpart of this Agreement;
(ii) duly executed Notes payable to each Lender;
(iii) an executed Subsidiary Guaranty Agreement;
(iv) a certificate of the Secretary or Assistant Secretary of
each Loan Party, attaching and certifying copies of its bylaws and of
the resolutions of its boards of directors, or partnership agreement
or limited liability company agreement, or comparable organizational
documents and authorizations, authorizing the execution, delivery and
performance of the Loan Documents to which it is a party and
certifying the name, titles and true signature of each officer of such
Loan Party execution the Loan Documents to which it is a party;
(v) certified copies of the articles or certificate of
incorporation, certificate or organization or limited partnership, or
other registered organizational documents of each Loan Party, together
with certificates of good standing or existence, as may be available
from the Secretary of State of the jurisdiction of organization of
such Loan Party;
(vi) a favorable written opinion of general counsel to the Loan
Parties, addressed to the Administrative Agent and each of the
Lenders, and covering such matters relating to the Loan Parties, the
Loan Documents and the transactions contemplated therein as the
Administrative Agent or the Required Lenders shall reasonably request;
30
(vii) certificates of insurance, in form and detail acceptable to
the Administrative Agent, describing the types and amounts of
insurance (property and liability) maintained by the Borrower and its
Subsidiaries; and
(viii) a certificate signed by the chief financial officer of the
Borrower demonstrating that the Leverage Ratio for the most recently
ended reporting period is less than or equal to 2.00:1.00 and
certifying that there has been no material adverse change in the
business or financial or other conditions of the Borrower, in the
assets and properties of the Borrower and its Subsidiaries, or in the
prospects or projections of the Borrower and its Subsidiaries and
Affiliates since December 30, 2003;
(ix) a duly executed Notice of Revolving Borrowing, if
applicable; and
(x) a duly executed funds disbursement agreement; and
(xi) such other documents, certificates, information or legal
opinions as the Administrative Agent may reasonably request, all in
form and substance reasonably satisfactory to the Administrative
Agent.
SECTION 3.2 EACH CREDIT EVENT. The obligation of each Lender to make a
Loan on the occasion of any Borrowing is subject to the satisfaction of the
following conditions:
(a) at the time of and immediately after giving effect to such
Borrowing no Default or Event of Default shall exist;
(b) at the time of and immediately after giving effect to such
Borrowing, all representations and warranties of each Loan Party set forth in
the Loan Documents shall be true and correct in all material respects on and as
of the date of such Borrowing before and after giving effect thereto (except for
such representations and warranties which relate to an earlier date or such
changes in factual circumstances as are expressly permitted under the Loan
Documents); and
(c) since the date of the most recent financial statements of the
Borrower described in SECTION 5.1(A), there shall have been no event,
circumstance, condition or change which has had or could reasonably be expected
to have a Material Adverse Effect.
Each Borrowing shall be deemed to constitute a representation and warranty
by the Borrower on the date thereof as to the matters specified in paragraphs
(a), (b) and (c) of this SECTION 3.2.
SECTION 3.3 DELIVERY OF DOCUMENTS. All of the Loan Documents,
certificates, legal opinions and other documents and papers referred to in this
Article III, unless otherwise specified, shall be delivered to the
Administrative Agent for the account of each of the Lenders and, except for the
Notes, in sufficient counterparts or copies for each of the Lenders and shall be
in form and substance satisfactory in all respects to the Administrative Agent.
31
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
------------------------------
The Borrower represents and warrants to the Administrative Agent and each
Lender as follows:
SECTION 4.1 EXISTENCE; POWER. The Borrower and each of its Subsidiaries
(i) is duly organized, validly existing and in good standing as a corporation,
partnership or limited liability company under the laws of the jurisdiction of
its organization, (ii) has all requisite power and authority to carry on its
business as now conducted, and (iii) is duly qualified to do business, and is in
good standing, in each jurisdiction where such qualification is required, except
where a failure to be so qualified could not reasonably be expected to result in
a Material Adverse Effect.
SECTION 4.2 ORGANIZATIONAL POWER; AUTHORIZATION. The execution, delivery
and performance by each Loan Party of the Loan Documents to which it is a party
are within such Loan Party's organizational powers and have been duly authorized
by all necessary organizational, and if required, shareholder, partner or
member, action. This Agreement has been duly executed and delivered by the
Borrower, and constitutes, and each other Loan Document to which any Loan Party
is a party, when executed and delivered by such Loan Party, will constitute,
valid and binding obligations of the Borrower or such Loan Party (as the case
may be), enforceable against it in accordance with their respective terms,
except as may be limited by applicable bankruptcy, insolvency, reorganization,
moratorium, or similar laws affecting the enforcement of creditors' rights
generally and by general principles of equity.
SECTION 4.3 GOVERNMENTAL APPROVALS; NO CONFLICTS. The execution, delivery
and performance by the Borrower of this Agreement, and by each Loan Party of the
other Loan Documents to which it is a party (a) do not require any consent or
approval of, registration or filing with, or any action by, any Governmental
Authority, except those as have been obtained or made and are in full force and
effect or where the failure to do so, individually or in the aggregate, could
not reasonably be expected to have a Material Adverse Effect, (b) will not
violate any Requirements of Law applicable to the Borrower or any of its
Subsidiaries or any judgment, order or ruling of any Governmental Authority, (c)
will not violate or result in a material default under any indenture, material
agreement or other material instrument binding on the Borrower or any of its
Subsidiaries or any of its assets or give rise to a right thereunder to require
any payment to be made by the Borrower or any of its Subsidiaries and (d) will
not result in the creation or imposition of any Lien on any asset of the
Borrower or any of its Subsidiaries, except Liens (if any) created under the
Loan Documents.
SECTION 4.4 FINANCIAL STATEMENTS. The Borrower has furnished to the
Administrative Agent and the Lenders (i) the audited consolidated balance sheet
of the Borrower and its Subsidiaries as of December 30, 2003 and the related
consolidated statements of income, shareholders' equity and cash flows for the
fiscal year then ended prepared by the Borrower and audited by Ernst & Young,
LLP and (ii) the unaudited consolidated balance sheet of the Borrower and its
Subsidiaries as of June 15, 2004, and the related unaudited condensed
consolidated statements of income and cash flows for the fiscal quarter and
year-to-date period then ended. Such financial statements fairly present the
consolidated financial condition of the Borrower and its Subsidiaries as of such
32
dates and the consolidated results of operations for such periods in conformity
with GAAP consistently applied, subject to year end audit adjustments and the
absence of footnotes in the case of the statements referred to in clause (ii).
Since December 30, 2003, there have been no changes with respect to the Borrower
and its Subsidiaries which have had or could reasonably be expected to have,
singly or in the aggregate, a Material Adverse Effect.
SECTION 4.5 LITIGATION AND ENVIRONMENTAL MATTERS.
(a) No litigation, investigation or proceeding of or before any
arbitrators or Governmental Authorities is pending against or, to the knowledge
of the Borrower, threatened against or affecting the Borrower or any of its
Subsidiaries (i) as to which there is a reasonable possibility of an adverse
determination that could reasonably be expected to have, either individually or
in the aggregate, a Material Adverse Effect or (ii) which in any manner draws
into question the validity or enforceability of this Agreement or any other Loan
Document.
(b) Except for the matters set forth on Schedule 4.5, neither the
Borrower nor any of its Subsidiaries (i) has failed to comply in any material
respect with any Environmental Law or to obtain, maintain or comply with any
permit, license or other approval required under any Environmental Law, (ii) has
become subject to any material Environmental Liability or (iii) has received
notice of any claim with respect to any material Environmental Liability.
SECTION 4.6 COMPLIANCE WITH LAWS AND AGREEMENTS. The Borrower and each
Subsidiary is in compliance with (a) all Requirements of Law and all judgments,
decrees and orders of any Governmental Authority, and (b) all indentures,
agreements or other instruments binding upon it or its properties, except where
non-compliance with the provisions of 4.6 (a) or (b), either singly or in the
aggregate, could not reasonably be expected to result in a Material Adverse
Effect.
SECTION 4.7 INVESTMENT COMPANY ACT, ETC. Neither the Borrower nor any of
its Subsidiaries is (a) an "investment company" or is "controlled" by an
"investment company" as such terms are defined in, or subject to regulation
under, the Investment Company Act of 1940, as amended, (b) a "holding company"
as defined in, or subject to regulation under, the Public Utility Holding
Company Act of 1935, as amended or (c) otherwise subject to any other regulatory
scheme limiting its ability to incur debt.
SECTION 4.8 TAXES. The Borrower and its Subsidiaries and each other Person
for whose taxes the Borrower or any Subsidiary are liable, have timely filed or
caused to be filed all Federal income tax returns and all other material tax
returns that are required to be filed by them, and have paid all taxes shown to
be due and payable on such returns or on any assessments made against it or its
property and all other taxes, fees or other charges imposed on it or any of its
property by any Governmental Authority, except (i) to the extent the failure to
do so would not have a Material Adverse Effect or (ii) where the same are
currently being contested in good faith by appropriate proceedings and for which
the Borrower or such Subsidiary, as the case may be, has set aside on its books
adequate reserves. The charges, accruals and reserves on the books of the
Borrower and its Subsidiaries in respect of such taxes are adequate, and no tax
liabilities that could be materially in excess of the amount so provided are
anticipated.
33
SECTION 4.9 MARGIN REGULATIONS. None of the proceeds of any of the Loans
will be used for "purchasing" or "carrying" any "margin stock" with the
respective meanings of each of such terms under Regulation U of the Board of
Governors of the Federal Reserve System as now and from time to time hereafter
in effect or for any purpose that violates the provisions Regulation U. Neither
the Borrower nor any of its Subsidiaries is engaged principally, or as one of
its important activities, in the business of extending credit for the purpose of
purchasing or carrying "margin stock."
SECTION 4.10 ERISA. No ERISA Event has occurred or is reasonably expected
to occur that, when taken together with all other such ERISA Events for which
liability is reasonably expected to occur, could reasonably be expected to
result in a Material Adverse Effect. The present value of all accumulated
benefit obligations under each Plan (based on the assumptions used for purposes
of Statement of Financial Standards No. 87) did not, as of the date of the most
recent financial statements reflecting such amounts, exceed by more than
$1,000,000 the fair market value of the assets of such Plan, and the present
value of all accumulated benefit obligations of all underfunded Plans (based on
the assumptions used for purposes of Statement of Financial Standards No. 87)
did not, as of the date of the most recent financial statements reflecting such
amounts, exceed by more than $1,000,000 the fair market value of the assets of
all such underfunded Plans.
SECTION 4.11 OWNERSHIP OF PROPERTY.
(a) Each of the Borrower and its Subsidiaries has good title to, or
valid leasehold interests in, all of its real and personal property material to
the operation of its business free and clear of Liens prohibited by this
Agreement.
(b) Each of the Borrower and its Subsidiaries owns, or is licensed,
or otherwise has the right, to use, all patents, trademarks, service marks,
trade names, copyrights and other intellectual property material to its
business, and the use thereof by the Borrower and its Subsidiaries does not, to
its knowledge, infringe on the rights of any other Person, except for any such
infringements that, individually or in the aggregate, would not have a Material
Adverse Effect.
(c) The properties of the Borrower and its Subsidiaries are insured
with financially sound and reputable insurance companies which are not
Affiliates of the Borrower, in such amounts 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 Borrower or any applicable
Subsidiary operates.
SECTION 4.12 DISCLOSURE. To the best of its knowledge, the Borrower has
disclosed to the Administrative Agent and the Lenders, all material agreements,
instruments, and corporate or other restrictions to which the Borrower or any of
its Subsidiaries] is subject, and all other matters known to any of them, with
respect to any of the foregoing, that, individually or in the aggregate, could
reasonably be expected to result in a Material Adverse Effect. No reports
(including without limitation all reports that the Borrower is required to file
with the Securities and Exchange Commission), financial statements, certificates
or other information furnished by or on behalf of the Borrower to the
Administrative Agent or any Lender in connection with the negotiation or
syndication of this Agreement or any other Loan Document or delivered hereunder
34
or thereunder (as modified or supplemented by any other information so
furnished) contains any material misstatement of fact or omits to state any
material fact necessary to make the statements therein, taken as a whole, in
light of the circumstances under which they were made, not misleading.
SECTION 4.13 LABOR RELATIONS. There are no strikes, lockouts or other
material labor disputes or grievances against the Borrower or any of its
Subsidiaries, or, to the Borrower's knowledge, threatened against or affecting
the Borrower or any of its Subsidiaries, and no significant unfair labor
practice, charges or grievances are pending against the Borrower or any of its
Subsidiaries, or to the Borrower's knowledge, threatened against any of them
before any Governmental Authority. All payments due from the Borrower or any of
its Subsidiaries pursuant to the provisions of any collective bargaining
agreement have been paid or accrued as a liability on the books of such Borrower
or any such Subsidiary, except where the failure to do so could not reasonably
be expected to have a Material Adverse Effect.
SECTION 4.14 INSOLVENCY. After giving effect to the execution and delivery
of the Loan Documents, the making of the Loans under this Agreement, neither the
Parent nor its Subsidiaries will be "insolvent," within the meaning of such term
as defined in ss.101 of Title 11 of the United States Code, as amended from time
to time, or be unable to pay its debts generally as such debts become due, or
have an unreasonably small capital to engage in any business or transaction,
whether current or contemplated.
SECTION 4.15 SUBSIDIARIES. Schedule 4.15 sets forth the name of, the
ownership interest of the Borrower in, the jurisdiction of incorporation of, and
the type of, each Subsidiary of the Borrower and identifies each Subsidiary that
is a Material Subsidiary and a Subsidiary Loan Party, in each case as of the
Closing Date.
SECTION 4.16 OFAC. No Loan Party (i) is a person whose property or
interest in property is blocked or subject to blocking pursuant to Section 1 of
Executive Order 13224 of September 23, 2001 Blocking Property and Prohibiting
Transactions With Persons Who Commit, Threaten to Commit, or Support Terrorism
(66 Fed. Reg. 49079 (2001)), (ii) engages in any dealings or transactions
prohibited by Section 2 of such executive order, or is otherwise associated with
any such person in any manner violative of Section 2, or (iii) is a person on
the list of Specially Designated Nationals and Blocked Persons or subject to the
limitations or prohibitions under any other U.S. Department of Treasury's Office
of Foreign Assets Control regulation or executive order.
SECTION 4.17 PATRIOT ACT. Each Loan Party is in compliance, in all
material respects, with the (i) the Trading with the Enemy Act, as amended, and
each of the foreign assets control regulations of the United States Treasury
Department (31 CFR, Subtitle B, Chapter V, as amended) and any other enabling
legislation or executive order relating thereto, and (ii) the Uniting And
Strengthening America By Providing Appropriate Tools Required To Intercept And
Obstruct Terrorism (USA Patriot Act of 2001). No part of the proceeds of the
Loans will be used, directly or indirectly, for any payments to any governmental
official or employee, political party, official of a political party, candidate
for political office, or anyone else acting in an official capacity, in order to
obtain, retain or direct business or obtain any improper advantage, in violation
of the United States Foreign Corrupt Practices Act of 1977, as amended.
35
SECTION 4.18 INDEBTEDNESS. As of the Closing Date, and except as set forth
on SCHEDULE 7.1, neither the Borrower nor any of its Subsidiaries has any
Indebtedness with a principal amount outstanding or a commitment to fund, in
either case, in excess of $500,000.
ARTICLE V
AFFIRMATIVE COVENANTS
---------------------
The Borrower covenants and agrees that so long as any Lender has a
Revolving Commitment hereunder or any Obligation remains unpaid or outstanding:
SECTION 5.1 FINANCIAL STATEMENTS AND OTHER INFORMATION. The Borrower will
deliver to the Administrative Agent and each Lender:
(a) as soon as available and in any event within 90 days after the
end of each fiscal year of Borrower, a copy of the annual audited report for
such fiscal year for the Borrower and its Subsidiaries, containing a
consolidated balance sheet of the Borrower and its Subsidiaries as of the end of
such fiscal year and the related consolidated statements of income,
stockholders' equity and cash flows (together with all footnotes thereto) of the
Borrower and its Subsidiaries for such fiscal year, setting forth in each case
in comparative form the figures for the previous fiscal year, all in reasonable
detail and reported on by independent public accountants of nationally
recognized standing (without a "going concern" or like qualification, exception
or explanation and without any qualification or exception as to the scope of
such audit) to the effect that such financial statements present fairly in all
material respects the financial condition and the results of operations of the
Borrower and its Subsidiaries for such fiscal year on a consolidated basis in
accordance with GAAP and that the examination by such accountants in connection
with such consolidated financial statements has been made in accordance with
generally accepted auditing standards;
(b) as soon as available and in any event within 45 days after the
end of each of the first three fiscal quarters of each fiscal year of the
Borrower, an unaudited consolidated balance sheet of the Borrower and its
Subsidiaries as of the end of such fiscal quarter and the related unaudited
consolidated statements of income and cash flows of the Borrower and its
Subsidiaries for such periods which are required to be included in the
Borrower's quarterly report in Form 10-Q, setting forth in each case in
comparative form the figures for the corresponding quarter and the corresponding
portion of Borrower's previous fiscal year, all certified by the chief financial
officer or treasurer of the Borrower as presenting fairly in all material
respects the financial condition and results of operations of the Borrower and
its Subsidiaries on a consolidated basis in accordance with GAAP, subject to
normal year-end audit adjustments and the absence of footnotes;
(c) concurrently with the delivery of the financial statements
referred to in clauses (a) and (b) above, a Compliance Certificate signed by the
principal financial officer of the Borrower;
(d) concurrently with the delivery of the financial statements
referred to in clause (a) above, a certificate of the accounting firm that
reported on such financial statements stating whether they obtained any
knowledge during the course of their examination of such financial statements of
36
any Default or Event of Default (which certificate may be limited to the extent
required by accounting rules or guidelines);
(e) promptly after the same become publicly available, copies of all
periodic and other reports, proxy statements and other materials filed with the
Securities and Exchange Commission, or any Governmental Authority succeeding to
any or all functions of said Commission, or with any national securities
exchange, or distributed by the Borrower to its shareholders generally, as the
case may be; and
(f) promptly following any request therefor, such other information
regarding the results of operations, business affairs and financial condition of
the Borrower or any Subsidiary as the Administrative Agent or any Lender may
reasonably request.
SECTION 5.2 NOTICES OF MATERIAL EVENTS. The Borrower will furnish to the
Administrative Agent and each Lender prompt written notice of the following:
(a) the occurrence of any Default or Event of Default;
(b) the filing or commencement of any action, suit or proceeding by
or before any arbitrator or Governmental Authority against or, to the knowledge
of the Borrower, affecting the Borrower or any Subsidiary which, if adversely
determined, could reasonably be expected to result in a Material Adverse Effect;
(c) the occurrence of any event or any other development by which
the Borrower or any of its Subsidiaries (i) fails to comply with any material
provision of any Environmental Law or to obtain, maintain or comply with any
permit, license or other approval required under any Environmental Law, (ii)
becomes subject to any Environmental Liability, or (iii) receives notice of any
claim with respect to any Environmental Liability, and in each of the preceding
clauses, which individually or in the aggregate, could reasonably be expected to
result in a Material Adverse Effect;
(d) the occurrence of any ERISA Event that alone, or together with
any other ERISA Events that have occurred, could reasonably be expected to
result in liability of the Borrower and its Subsidiaries in an aggregate amount
exceeding $250,000; and
(e) any other event that results in, or could reasonably be expected
to result in, a Material Adverse Effect.
Each notice delivered under this Section shall be accompanied by a written
statement of a Responsible Officer setting forth the details of the event or
development requiring such notice and any action taken or proposed to be taken
with respect thereto.
SECTION 5.3 EXISTENCE; CONDUCT OF BUSINESS. The Borrower will, and will
cause each of its Subsidiaries to, do or cause to be done all things necessary
to preserve, renew and maintain in full force and effect its legal existence and
its respective rights, licenses, permits, privileges, franchises, patents,
copyrights, trademarks and trade names material to the conduct of its business
and will continue to engage in substantially the same primary business as
37
presently conducted or such other businesses that are reasonably related
thereto; PROVIDED, that nothing in this Section shall prohibit any merger,
consolidation, liquidation or dissolution permitted under SECTION 7.3.
SECTION 5.4 COMPLIANCE WITH LAWS, ETC. The Borrower will, and will cause
each of its Subsidiaries to, comply with all material laws, rules, regulations
and requirements of any Governmental Authority applicable to its business and
properties, including without limitation, all Environmental Laws, ERISA and
OSHA, except where the failure to do so, either individually or in the
aggregate, could not reasonably be expected to result in a Material Adverse
Effect.
SECTION 5.5 PAYMENT OF OBLIGATIONS. The Borrower will, and will cause each
of its Subsidiaries to, pay and discharge at or before maturity, all of its
obligations and liabilities (including without limitation all tax liabilities
and claims that could result in a statutory Lien) before the same shall become
delinquent or in default, except where (a) the validity or amount thereof is
being contested in good faith by appropriate proceedings, (b) the Borrower or
such Subsidiary has set aside on its books adequate reserves with respect
thereto in accordance with GAAP and (c) the failure to make payment could not
reasonably be expected to result in a Material Adverse Effect.
SECTION 5.6 BOOKS AND RECORDS. The Borrower will, and will cause each of
its Subsidiaries to, keep proper books of record and account in which full, true
and correct entries shall be made of all dealings and transactions in relation
to its business and activities to the extent necessary to prepare the
consolidated financial statements of Borrower in conformity with GAAP.
SECTION 5.7 VISITATION, INSPECTION, ETC. The Borrower will, and will cause
each of its Subsidiaries to, permit any representative of the Administrative
Agent and each Lender, to visit and inspect its properties, to examine its books
and records and to make copies and take extracts therefrom, and to discuss its
affairs, finances and accounts with any of its officers and with its independent
certified public accountants, all at such reasonable times and as often as the
Administrative Agent (or a Lender) may reasonably request after reasonable prior
notice to the Borrower. Such visitation and examination shall be solely for
purposes of evaluating this credit facility and subject to the confidentiality
requirements of applicable law.
SECTION 5.8 MAINTENANCE OF PROPERTIES; INSURANCE. The Borrower will, and
will cause each of its Subsidiaries to, (a) keep and maintain all property
material to the conduct of its business in good working order and condition,
ordinary wear and tear excepted, except where the failure to do so, either
individually or it the aggregate, could not reasonably be expected to result in
a Material Adverse Effect and (b) maintain with financially sound and reputable
insurance companies, insurance with respect to its properties and business, and
the properties and business of its Subsidiaries, against loss or damage of the
kinds customarily insured against by companies in the same or similar businesses
operating in the same or similar locations.
SECTION 5.9 ADDITIONAL SUBSIDIARIES. Any Person organized under the laws
of any state of the United States of America that at any time becomes a Material
Subsidiary (including by way of acquisition) shall, within 10 days after
becoming a Material Subsidiary, execute and deliver to the Administrative Agent
(x) a Subsidiary Guaranty Supplement and (y) upon the request of the
Administrative Agent, those items that would have been delivered under SECTION
38
3.1 if such Subsidiary had been a Subsidiary Loan Party on the Closing Date, in
each case in form and substance satisfactory to the Administrative Agent.
SECTION 5.10 USE OF PROCEEDS. The Borrower will use the proceeds of all
Loans to finance working capital needs, capital expenditures, the repurchase of
the common stock of Borrower and for other general corporate purposes of the
Borrower and its Subsidiaries. No part of the proceeds of any Loan will be used,
whether directly or indirectly, for any purpose that would violate any rule or
regulation of the Board of Governors of the Federal Reserve System, including
Regulations T, U or X.
SECTION 5.11 FURTHER ASSURANCES. The Borrower will, and will cause each
Subsidiary Loan Party to, execute any and all further documents, agreements and
instruments, and take all such further actions which may be required under any
applicable law, or which the Administrative Agent or the Required Lenders may
reasonably request, to effectuate the transactions contemplated by the Loan
Documents.
ARTICLE VI
FINANCIAL COVENANTS
-------------------
The Borrower covenants and agrees that so long as any Lender has a
Revolving Commitment hereunder or any Obligation remains unpaid or outstanding:
SECTION 6.1 LEVERAGE RATIO. The Borrower will have, as of the end of each
fiscal quarter (calculated for such quarter and the three prior fiscal quarters)
of the Borrower, commencing with the fiscal quarter ending September 30, 2004, a
Leverage Ratio of not greater than 2.00 to 1.00.
SECTION 6.2 FIXED CHARGE COVERAGE RATIO. The Borrower will have, as of the
end of each fiscal quarter (calculated for such quarter and the three prior
fiscal quarters) of the Borrower, commencing with the fiscal quarter ending
September 30, 2004, a Fixed Charge Coverage Ratio of not less than 1.50 to 1.00.
SECTION 6.3 CONSOLIDATED NET WORTH. The Borrower will not permit its
Consolidated Net Worth at any time to be less than $400,000,000 plus 50% of
Consolidated Net Income on a cumulative basis, commencing with the fiscal
quarter ending June 15, 2004; PROVIDED, that if Consolidated Net Income is
negative in any fiscal quarter the amount added for such fiscal quarter shall be
zero and such negative Consolidated Net Income shall not reduce the amount of
Consolidated Net Income added from any previous fiscal quarter. The amount of
Consolidated Net Worth set forth above shall be increased by 75% of the amount
by which the Borrower's "total stockholders' equity" is increased as a result of
any public or private offering of common stock of the Borrower after the Closing
Date and shall be increased by the amount of any tax benefit achieved by the
Borrower as a result of recording non-cash charges related to Borrower's common
stock options. Promptly upon the consummation of such offering, the Borrower
shall notify the Administrative Agent in writing of the amount of such increase
in "total stockholders' equity." The amount of Consolidated Net Worth set forth
therein shall be reduced by the value of common shares repurchased by the
Borrower subsequent to the Closing Date.
39
SECTION 6.4 NEW STORE CAPITAL EXPENDITURES. The Borrower will not make or
incur, or permit any of its Subsidiaries to make or incur, New Store Capital
Expenditures in any fiscal year of the Borrower that exceed $50,000,000 in the
aggregate for such fiscal year.
ARTICLE VII
NEGATIVE COVENANTS
------------------
The Borrower covenants and agrees that so long as any Lender has a
Revolving Commitment hereunder or any Obligation remains unpaid or outstanding:
SECTION 7.1 INDEBTEDNESS. The Borrower will not, and will not permit any
of its Subsidiaries to, create, incur, assume or suffer to exist any
Indebtedness, except:
(a) Indebtedness created pursuant to the Loan Documents;
(b) Indebtedness existing on the date hereof and set forth on
SCHEDULE 7.1 and extensions, renewals and replacements of any such Indebtedness
that do not increase the outstanding principal amount thereof (immediately prior
to giving effect to such extension, renewal or replacement) or shorten the
maturity or the weighted average life thereof;
(c) Indebtedness of the Borrower owing to any Subsidiary and of any
Subsidiary owing to the Borrower or any other Subsidiary; PROVIDED, that any
such Indebtedness that is owed to a Subsidiary or by a Subsidiary shall be a
domestic Subsidiary created and existing under the laws of a state of the United
States;
(d) Indebtedness with respect to obligations under Hedging
Transactions permitted by SECTION 7.10; and
(e) other Indebtedness in an aggregate principal amount not to
exceed $10,000,000 at any time outstanding.
SECTION 7.2 NEGATIVE PLEDGE. The Borrower will not, and will not permit
any of its Subsidiaries to, create, incur, assume or suffer to exist any Lien on
any of its assets or property now owned or hereafter acquired or, except:
(a) Liens created in favor of the Administrative Agent for the
benefit of the Lenders;
(b) Permitted Encumbrances;
(c) Any Liens on any property or asset of the Borrower or any
Subsidiary existing on the Closing Date set forth on SCHEDULE 7.2; PROVIDED,
that such Lien shall not apply to any other property or asset of the Borrower or
any Subsidiary; and
(d) Liens on assets which in the aggregate do not exceed in book
value Ten Million Dollars ($10,000,000);
40
(e) extensions, renewals, or replacements of any Lien referred to in
paragraphs (a) through (d) of this Section; PROVIDED, that the principal amount
of the Indebtedness secured thereby is not increased and that any such
extension, renewal or replacement is limited to the assets originally encumbered
thereby.
SECTION 7.3 FUNDAMENTAL CHANGES.
(a) The Borrower will not, and will not permit any Subsidiary to,
merge into or consolidate into any other Person, or permit any other Person to
merge into or consolidate with it, or sell, lease, transfer or otherwise dispose
of (in a single transaction or a series of transactions) all or substantially
all of its assets (in each case, whether now owned or hereafter acquired) or all
or substantially all of the stock of any of its Subsidiaries (in each case,
whether now owned or hereafter acquired) or liquidate or dissolve; PROVIDED,
that if at the time thereof and immediately after giving effect thereto, no
Default or Event of Default shall have occurred and be continuing (i) the
Borrower or any Subsidiary may merge with a Person if the Borrower (or such
Subsidiary if the Borrower is not a party to such merger) is the surviving
Person, (ii) any Subsidiary may merge into another Subsidiary; PROVIDED, that if
any party to such merger is a Subsidiary Loan Party, the Subsidiary Loan Party
shall be the surviving Person, (iii) any Subsidiary may sell, transfer, lease or
otherwise dispose of all or substantially all of its assets to the Borrower or
to a Subsidiary Loan Party and (iv) any Subsidiary (other than a Subsidiary Loan
Party) may liquidate or dissolve if the Borrower determines in good faith that
such liquidation or dissolution is in the best interests of the Borrower and is
not materially disadvantageous to the Lenders; PROVIDED, that any such merger
involving a Person that is not a wholly-owned Subsidiary immediately prior to
such merger shall not be permitted unless also permitted by SECTION 7.4 or by
SECTION 7.5.
(b) The Borrower will not, and will not permit any of its
Subsidiaries to, engage to any material extent in any primary business other
than businesses substantially of the type conducted by the Borrower and its
Subsidiaries on the date hereof and businesses reasonably related thereto.
SECTION 7.4 INVESTMENTS, LOANS, ETC. The Borrower will not, and will not
permit any of its Subsidiaries to, purchase, hold or acquire (including pursuant
to any merger with any Person that was not a wholly-owned Subsidiary prior to
such merger), any common stock, evidence of indebtedness or other securities
(including any option, warrant, or other right to acquire any of the foregoing)
of, make or permit to exist any loans or advances to, Guarantee any obligations
of, or make or permit to exist any investment or any other interest in, any
other Person (all of the foregoing being collectively called "INVESTMENTS"), or
purchase or otherwise acquire (in one transaction or a series of transactions)
any assets of any other Person that constitute a business unit, except:
(a) Investments (other than Permitted Investments) existing on the
date hereof and set forth on SCHEDULE 7.4 (including Investments in
Subsidiaries);
(b) Permitted Investments;
(c) Guarantees constituting Indebtedness permitted by SECTION 7.1;
41
(d) Investments made by the Borrower in or to any Subsidiary and by
any Subsidiary to the Borrower or in or to another Subsidiary;
(e) loans or advances to employees, officers or directors of the
Borrower or any Subsidiary in the ordinary course of business for travel,
relocation and related expenses;
(f) Hedging Obligations permitted by SECTION 7.10;
(g) Other Investments which in the aggregate do not exceed
$7,000,000 in any fiscal year of the Borrower; provided, however, that, to the
extent an Investment shall also qualify as an Acquisition, such Investment shall
not be permitted under this clause (g) and shall be required to comply with
subsection (i) of this SECTION 7.4; provided, further, that this clause (g)
shall not be used for the purpose of making any Investment of the type described
in clause (ii) of the defined term of "Permitted Investment";
(h) Investments made pursuant to deferred compensation plans; and
(i) Acquisitions permitted by SECTION 7.5.
SECTION 7.5 ACQUISITIONS. The Borrower will not make, engage in or effect,
and will not permit any Subsidiary to make, engage in or effect, any Acquisition
unless each of the terms and conditions set forth below in this Section have
been satisfied in the discretion of the Administrative Agent:
(a) no Default or Event of Default shall have occurred and be
continuing at the time of the consummation of such Acquisition or would exist
immediately after giving effect thereto;
(b) each business acquired shall be within the permitted line of
business described in SECTION 5.3;
(c) written notice of any proposed Acquisition shall be given to the
Lenders no less than thirty (30) days prior to the consummation of such
Acquisition, together with any then existing drafts of the acquisition documents
and such other documents or materials as may be reasonably requested by a
Lender;
(d) in the case of an Acquisition involving the acquisition of stock
or other ownership interests of any Person, immediately after giving effect to
such Acquisition such Person (or the surviving Person, if the Acquisition is
effected through a merger or consolidation) shall be a Subsidiary of the
Borrower and such Subsidiary shall comply with SECTION 5.9 to the extent
applicable;
(e) the aggregate consideration for the purchase price of such
Acquisition (including, without limitation, cash, Indebtedness and equity), when
added to the aggregate consideration for the purchase prices of all other
Acquisitions consummated during the term of this Agreement, does not exceed
$40,000,000; and
42
(f) the Borrower shall cause to be delivered to the Administrative
Agent a certificate, in form and substance reasonably satisfactory to the
Administrative Agent, executed by a Chief Financial Officer of the Borrower,
certifying that the consummation of such Acquisition will not result in a
violation of any provision of this Agreement, and after giving effect to such
Acquisition and any Borrowings made in connection therewith, the Borrower will
be in compliance with the financial covenants contained in Article VI hereof,
such compliance determined with regard to calculations made on a pro forma basis
in accordance with GAAP as if the acquired Person or assets had been
consolidated with the Borrower for those periods applicable to such covenants.
SECTION 7.6 SALE OF ASSETS. The Borrower will not, and will not permit any
of its Subsidiaries to, convey, sell, lease, assign, transfer or otherwise
dispose of, any of its assets, business or property, whether now owned or
hereafter acquired, or, in the case of any Subsidiary, issue or sell any shares
of such Subsidiary's common stock to any Person other than the Borrower or any
wholly-owned Subsidiary of the Borrower or a Subsidiary Loan Party (or to
qualify directors if required by applicable law), except:
(a) the sale or other disposition for fair market value of obsolete
or worn out property or other property not necessary for operations disposed of
in the ordinary course of business;
(b) the sale of inventory and Permitted Investments in the ordinary
course of business; and
(c) the sale or other disposition of such assets in an aggregate
amount not to exceed $10,000,000 in any fiscal year of the Borrower.
SECTION 7.7 TRANSACTIONS WITH AFFILIATES. The Borrower will not, and will
not permit any of its Subsidiaries to, sell, lease or otherwise transfer any
property or assets to, or purchase, lease or otherwise acquire any property or
assets from, or otherwise engage in any other transactions with, any of its
Affiliates, except (a) in the ordinary course of business at prices and on terms
and conditions not less favorable to the Borrower or such Subsidiary than could
be obtained on an arm's-length basis from unrelated third parties and (b)
transactions between or among the Borrower and its Subsidiaries not involving
any other Affiliates.
SECTION 7.8 RESTRICTIVE AGREEMENTS. The Borrower will not, and will not
permit any Subsidiary to, directly or indirectly, enter into, incur or permit to
exist any agreement that prohibits, restricts or imposes any condition upon (a)
the ability of the Borrower or any Subsidiary to create, incur or permit any
Lien upon any of its assets or properties, whether now owned or hereafter
acquired, or (b) the ability of any Subsidiary to pay dividends or other
distributions with respect to its common stock, to make or repay loans or
advances to the Borrower or any other Subsidiary, to Guarantee Indebtedness of
the Borrower or any other Subsidiary or to transfer any of its property or
assets to the Borrower or any Subsidiary of the Borrower; PROVIDED, that (i) the
foregoing shall not apply to restrictions or conditions imposed by law, by this
Agreement or any other Loan Document or by that certain Loan Agreement dated as
of April 28, 2000, as may have been amended from time to time and as in effect
on the date hereof with InTrust Bank, N.A., (ii) the foregoing shall not apply
to conditions imposed with respect to Hedging Transactions with Lenders limiting
43
creation, incurrence or permitting Liens (ii) the foregoing shall not apply to
customary restrictions and conditions contained in agreements relating to the
sale of a Subsidiary pending such sale, provided such restrictions and
conditions apply only to the Subsidiary that is sold and such sale is permitted
hereunder, (iii) clause (a) shall not apply to restrictions or conditions
imposed by any agreement relating to secured Indebtedness permitted by this
Agreement if such restrictions and conditions apply only to the property or
assets securing such Indebtedness and (iv) clause (a) shall not apply to
customary provisions in leases and other contracts entered into in the ordinary
course of business.
SECTION 7.9 SALE AND LEASEBACK TRANSACTIONS. The Borrower will not, and
will not permit any of the Subsidiaries to, enter into any arrangement, directly
or indirectly, whereby it shall sell or transfer any property, real or personal,
used or useful in its business, whether now owned or hereinafter acquired, and
thereafter rent or lease such property or other property that it intends to use
for substantially the same purpose or purposes as the property sold or
transferred.
SECTION 7.10 HEDGING TRANSACTIONS. The Borrower will not, and will not
permit any of the Subsidiaries to, enter into any Hedging Transaction, other
than (a) Hedging Transactions entered into in the ordinary course of business to
hedge or mitigate risks to which the Borrower or any Subsidiary is exposed in
the conduct of its business or the management of its liabilities and which do
not exceed in the aggregate Ten Million Dollars ($10,000,000). Solely for the
avoidance of doubt, the Borrower acknowledges that a Hedging Transaction entered
into for speculative purposes or of a speculative nature (which shall be deemed
to include any Hedging Transaction under which the Borrower or any of the
Subsidiaries is or may become obliged to make any payment (i) in connection with
the purchase by any third party of any common stock or any Indebtedness or (ii)
as a result of changes in the market value of any common stock or any
Indebtedness) is not a Hedging Transaction entered into in the ordinary course
of business to hedge or mitigate risks.
SECTION 7.11 AMENDMENT TO MATERIAL DOCUMENTS. The Borrower will not, and
will not permit any Subsidiary to, amend, modify or waive any of its rights in a
manner materially adverse to the Lenders under its certificate of incorporation,
bylaws or other organizational documents.
SECTION 7.12 ACCOUNTING CHANGES. The Borrower will not, and will not
permit any Subsidiary to, make any significant change in accounting treatment or
reporting practices, except as required by GAAP, or change the fiscal year of
the Borrower or of any Subsidiary, except to change the fiscal year of a
Subsidiary to conform its fiscal year to that of the Borrower.
ARTICLE VIII
EVENTS OF DEFAULT
-----------------
SECTION 8.1 EVENTS OF DEFAULT. If any of the following events (each an
"EVENT OF DEFAULT") shall occur:
(a) the Borrower shall fail to pay any principal of any Loan when
and as the same shall become due and payable, whether at the due date thereof or
at a date fixed for prepayment or otherwise; or
44
(b) the Borrower shall fail to pay any interest on any Loan or any
fee or any other amount (other than an amount payable under clause (a) of this
Article) payable under this Agreement or any other Loan Document, when and as
the same shall become due and payable, and such failure shall continue
unremedied for a period of three (3) Business Days; or
(c) any representation or warranty made or deemed made by or on
behalf of the Borrower or any Subsidiary in connection with this Agreement or
any other Loan Document (including the Schedules attached thereto) and any
amendments or modifications hereof or waivers hereunder, or in any certificate,
report, financial statement or other document submitted to the Administrative
Agent or the Lenders by any Loan Party or any representative of any Loan Party
pursuant to or in connection with this Agreement or any other Loan Document
shall prove to be incorrect in any material respect when made or deemed made or
submitted; or
(d) the Borrower shall fail to observe or perform any covenant or
agreement contained in SECTIONS 5.1, 5.2 or 5.3 (with respect to the Borrower's
existence) or Articles VI or VII; or
(e) any Loan Party shall fail to observe or perform any covenant or
agreement contained in this Agreement (other than those referred to in clauses
(a), (b) and (d) above), and such failure shall remain unremedied for 30 days
after the earlier of (i) any officer of the Borrower becomes aware of such
failure, or (ii) notice thereof shall have been given to the Borrower by the
Administrative Agent or any Lender; or
(f) the Borrower or any Subsidiary (whether as primary obligor or as
guarantor or other surety) shall fail to pay any principal of or premium or
interest on any Material Indebtedness that is outstanding, when and as the same
shall become due and payable (whether at scheduled maturity, required
prepayment, acceleration, demand or otherwise), and such failure shall continue
after the applicable grace period, if any, specified in the agreement or
instrument evidencing such Indebtedness; or any other event shall occur or
condition shall exist under any agreement or instrument relating to such
Indebtedness and shall continue after the applicable grace period, if any,
specified in such agreement or instrument, if the effect of such event or
condition is to accelerate, or permit the acceleration of, the maturity of such
Indebtedness; or any such Indebtedness shall be declared to be due and payable;
or required to be prepaid or redeemed (other than by a regularly scheduled
required prepayment or redemption), purchased or defeased, or any offer to
prepay, redeem, purchase or defease such Indebtedness shall be required to be
made, in each case prior to the stated maturity thereof; or
(g) the Borrower or any Subsidiary shall (i) commence a voluntary
case or other proceeding or file any petition seeking liquidation,
reorganization or other relief under any federal, state or foreign bankruptcy,
insolvency or other similar law now or hereafter in effect or seeking the
appointment of a custodian, trustee, receiver, liquidator or other similar
official of it or any substantial part of its property, (ii) consent to the
institution of, or fail to contest in a timely and appropriate manner, any
proceeding or petition described in clause (i) of this Section, (iii) apply for
or consent to the appointment of a custodian, trustee, receiver, liquidator or
other similar official for the Borrower or any such Subsidiary or for a
45
substantial part of its assets, (iv) file an answer admitting the material
allegations of a petition filed against it in any such proceeding, (v) make a
general assignment for the benefit of creditors, or (vi) take any action for the
purpose of effecting any of the foregoing; or
(h) an involuntary proceeding shall be commenced or an involuntary
petition shall be filed seeking (i) liquidation, reorganization or other relief
in respect of the Borrower or any Subsidiary or its debts, or any substantial
part of its assets, under any federal, state or foreign bankruptcy, insolvency
or other similar law now or hereafter in effect or (ii) the appointment of a
custodian, trustee, receiver, liquidator or other similar official for the
Borrower or any Subsidiary or for a substantial part of its assets, and in any
such case, such proceeding or petition shall remain undismissed for a period of
60 days or an order or decree approving or ordering any of the foregoing shall
be entered; or
(i) the Borrower or any Subsidiary shall become unable to pay, shall
admit in writing its inability to pay, or shall fail to pay, its debts as they
become due; or
(j) an ERISA Event shall have occurred that, in the opinion of the
Required Lenders, when taken together with other ERISA Events that have
occurred, could reasonably be expected to result in liability to the Borrower
and the Subsidiaries in an aggregate amount exceeding $1,000,000; or
(k) any judgment or order for the payment of money in excess of
$2,000,000 in the aggregate shall be rendered against the Borrower or any
Subsidiary, and either (i) enforcement proceedings shall have been commenced by
any creditor upon such judgment or order or (ii) there shall be a period of 60
consecutive days during which a stay of enforcement of such judgment or order,
by reason of a pending appeal or otherwise, shall not be in effect; or
(l) any non-monetary judgment or order shall be rendered against the
Borrower or any Subsidiary that could reasonably be expected to have a Material
Adverse Effect, and there shall be a period of 30 consecutive days during which
a stay of enforcement of such judgment or order, by reason of a pending appeal
or otherwise, shall not be in effect; or
(m) a Change in Control shall occur or exist; or
(n) any provision of any Subsidiary Guaranty Agreement shall for any
reason cease to be valid and binding on, or enforceable against, any Subsidiary
Loan Party, or any Subsidiary Loan Party shall so state in writing, or any
Subsidiary Loan Party shall seek to terminate its Subsidiary Guaranty Agreement;
then, and in every such event (other than an event with respect to the Borrower
described in clause (g) or (h) of this Section) and at any time thereafter
during the continuance of such event, the Administrative Agent may, and upon the
written request of the Required Lenders shall, by notice to the Borrower, take
any or all of the following actions, at the same or different times: (i)
terminate the Revolving Commitments, whereupon the Revolving Commitment of each
Lender shall terminate immediately; (ii) declare the principal of and any
accrued interest on the Loans, and all other Obligations owing hereunder, to be,
whereupon the same shall become due and payable immediately, without
46
presentment, demand, protest or other notice of any kind, all of which are
hereby waived by the Borrower; (iii) exercise all remedies contained in any
other Loan Document and (iv) exercise any other remedies available at law or in
equity; and that, if an Event of Default specified in either clause (g) or (h)
shall occur, the Revolving Commitments shall automatically terminate and the
principal of the Loans then outstanding, together with accrued interest thereon,
and all fees, and all other Obligations shall automatically become due and
payable, without presentment, demand, protest or other notice of any kind, all
of which are hereby waived by the Borrower.
ARTICLE IX
THE ADMINISTRATIVE AGENT
------------------------
SECTION 9.1 APPOINTMENT OF ADMINISTRATIVE AGENT. Each Lender irrevocably
appoints SunTrust Bank as the Administrative Agent and authorizes it to take
such actions on its behalf and to exercise such powers as are delegated to the
Administrative Agent under this Agreement and the other Loan Documents, together
with all such actions and powers that are reasonably incidental thereto. The
Administrative Agent may perform any of its duties hereunder or under the other
Loan Documents by or through any one or more sub-agents or attorneys-in-fact
appointed by the Administrative Agent. The Administrative Agent and any such
sub-agent or attorney-in-fact may perform any and all of its duties and exercise
its rights and powers through their respective Related Parties. The exculpatory
provisions set forth in this Article shall apply to any such sub-agent or
attorney-in-fact and the Related Parties of the Administrative Agent and any
such sub-agent and any such attorney-in-fact 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.
SECTION 9.2 NATURE OF DUTIES OF ADMINISTRATIVE AGENT. The Administrative
Agent shall not have any duties or obligations except those expressly set forth
in this Agreement and the other Loan Documents. Without limiting the generality
of the foregoing, (a) the Administrative Agent shall not be subject to any
fiduciary or other implied duties, regardless of whether a Default or an Event
of Default has occurred and is continuing, (b) the Administrative Agent shall
not have any duty to take any discretionary action or exercise any discretionary
powers, except those discretionary rights and powers expressly contemplated by
the Loan Documents that the Administrative Agent is required to exercise in
writing by the Required Lenders (or such other number or percentage of the
Lenders as shall be necessary under the circumstances as provided in SECTION
10.2), and (c) except as expressly set forth in the Loan Documents, the
Administrative Agent shall not have any duty to disclose, and shall not be
liable for the failure to disclose, any information relating to the Borrower or
any of its Subsidiaries that is communicated to or obtained by 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, its sub-agents or attorneys-in-fact with the consent or at the request of
the Required Lenders (or such other number or percentage of the Lenders as shall
be necessary under the circumstances as provided in SECTION 10.2) or in the
absence of its own gross negligence or willful misconduct. The Administrative
Agent shall not be responsible for the negligence or misconduct or any
sub-agents or attorneys-in-fact selected by it with reasonable care. The
Administrative Agent shall not be deemed to have knowledge of any Default or
Event of Default unless and until written notice thereof (which notice shall
include an express reference to such event being a "Default" or "Event of
Default" hereunder) is given to the Administrative Agent by the Borrower or any
47
Lender, and 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 any 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 and conditions set forth in any Loan
Document, (iv) the validity, enforceability, effectiveness or genuineness of any
Loan Document or any other agreement, instrument or document, or (v) the
satisfaction of any condition set forth in Article III or elsewhere in any Loan
Document, other than to confirm receipt of items expressly required to be
delivered to the Administrative Agent. The Administrative Agent may consult with
legal counsel (including counsel for the Borrower) concerning all matters
pertaining to such duties.
SECTION 9.3 LACK OF RELIANCE ON THE ADMINISTRATIVE AGENT. Each of the
Lenders acknowledges that it has, independently and without reliance upon the
Administrative Agent or any other Lender and based on such documents and
information as it has deemed appropriate, made its own credit analysis and
decision to enter into this Agreement. Each of the Lenders also acknowledges
that it will, independently and without reliance upon the Administrative Agent
or any other Lender and based on such documents and information as it has deemed
appropriate, continue to make its own decisions in taking or not taking of any
action under or based on this Agreement, any related agreement or any document
furnished hereunder or thereunder.
SECTION 9.4 CERTAIN RIGHTS OF THE ADMINISTRATIVE AGENT. If the
Administrative Agent shall request instructions from the Required Lenders with
respect to any action or actions (including the failure to act) in connection
with this Agreement, the Administrative Agent shall be entitled to refrain from
such act or taking such act, unless and until it shall have received
instructions from such Lenders; and the Administrative Agent shall not incur
liability to any Person by reason of so refraining. Without limiting the
foregoing, no Lender shall have any right of action whatsoever against the
Administrative Agent as a result of the Administrative Agent acting or
refraining from acting hereunder in accordance with the instructions of the
Required Lenders where required by the terms of this Agreement.
SECTION 9.5 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 believed by it to be genuine and to have been signed, sent or
made by the proper Person. The Administrative Agent may also rely upon any
statement made to it orally or by telephone and believed by it to be made by the
proper Person and shall not incur any liability for relying thereon. The
Administrative Agent may consult with legal counsel (including counsel for the
Borrower), independent public 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 such counsel, accountants or experts.
SECTION 9.6 THE ADMINISTRATIVE AGENT IN ITS INDIVIDUAL CAPACITY. The bank
serving as the Administrative Agent shall have the same rights and powers under
this Agreement and any other Loan Document in its capacity as a Lender as any
other Lender and may exercise or refrain from exercising the same as though it
were not the Administrative Agent; and the terms "Lenders", "Required Lenders",
"holders of Notes", or any similar terms shall, unless the context clearly
otherwise indicates, include the Administrative Agent in its individual
48
capacity. The bank acting as the Administrative Agent and its Affiliates may
accept deposits from, lend money to, and generally engage in any kind of
business with the Borrower or any Subsidiary or Affiliate of the Borrower as if
it were not the Administrative Agent hereunder.
SECTION 9.7 SUCCESSOR ADMINISTRATIVE AGENT.
(a) The Administrative Agent may resign at any time by giving notice
thereof to the Lenders and the Borrower. Upon any such resignation or removal,
the Required Lenders shall have the right to appoint a successor Administrative
Agent, subject to the approval by the Borrower provided that no Default or Event
of Default shall exist at such time. If no successor Administrative Agent shall
have been so appointed, and shall have accepted such appointment within 30 days
after the retiring Administrative Agent gives notice of resignation, then the
retiring Administrative Agent may, on behalf of the Lenders, appoint a successor
Administrative Agent, which shall be a commercial bank organized under the laws
of the United States of America or any state thereof or a bank which maintains
an office in the United States, having a combined capital and surplus of at
least $500,000,000.
(b) Upon the acceptance of its appointment as the Administrative
Agent hereunder by a successor, such successor Administrative Agent shall
thereupon succeed to and become vested with all the rights, powers, privileges
and duties of the retiring Administrative Agent, and the retiring Administrative
Agent shall be discharged from its duties and obligations under this Agreement
and the other Loan Documents. If within 45 days after written notice is given of
the retiring Administrative Agent's resignation under this Section no successor
Administrative Agent shall have been appointed and shall have accepted such
appointment, then on such 45th day (i) the retiring Administrative Agent's
resignation shall become effective, (ii) the retiring Administrative Agent shall
thereupon be discharged from its duties and obligations under the Loan Documents
and (iii) the Required Lenders shall thereafter perform all duties of the
retiring Administrative Agent under the Loan Documents until such time as the
Required Lenders appoint a successor Administrative Agent as provided above.
After any retiring Administrative Agent's resignation hereunder, the provisions
of this Article IX shall continue in effect for the benefit of such retiring
Administrative Agent and its representatives and agents in respect of any
actions taken or not taken by any of them while it was serving as the
Administrative Agent.
SECTION 9.8 AUTHORIZATION TO EXECUTE OTHER LOAN DOCUMENTS. Each Lender
hereby authorizes the Administrative Agent to execute on behalf of all Lenders
all Loan Documents other than this Agreement.
ARTICLE X
MISCELLANEOUS
-------------
SECTION 10.1 NOTICES.
(a) Except in the case of notices and other communications expressly
permitted to be given by telephone, all notices and other communications to any
party herein to be effective shall be in writing and shall be delivered by hand
or overnight courier service, mailed by certified or registered mail or sent by
telecopy, as follows:
49
To the Borrower: 000 Xxxx Xxxxxxx
Xxxxx 000
Xxxxxxx, XX 00000
Attention: Xxxx X. Xxxxx
Telecopy Number: (000) 000-0000
To the Administrative Agent: SunTrust Bank
000 Xxxxxxxxx Xxxxxx, X.X.
Xxxxxxx, Xxxxxxx 00000
Attention: Agency Services
Telecopy Number: (000) 000-0000
With a copy to: SunTrust Capital Markets, Inc.
SunTrust Bank
Mail Code 1922
000 Xxxxxxxxx Xxxxxx, 0xx Xxxxx
Xxxxxxx, Xxxxxxx 00000
Attention: Xxxxxxx X. Xxxxxxx
Telecopy Number: (000) 000-0000
To any Lender: the address set forth in the
Administrative Questionnaire
Any party hereto may change its address or telecopy number for
notices and other communications hereunder by notice to the other parties
hereto. All such notices and other communications shall, when transmitted by
overnight delivery, or faxed, be effective when delivered for overnight
(next-day) delivery, or transmitted in legible form by facsimile machine,
respectively, or if mailed, upon the third Business Day after the date deposited
into the mail or if delivered, upon delivery; PROVIDED, that notices delivered
to the Administrative Agent shall not be effective until actually received by
such Person at its address specified in this Section.
(b) Any agreement of the Administrative Agent and the Lenders herein
to receive certain notices by telephone or facsimile is solely for the
convenience and at the request of the Borrower. The Administrative Agent and the
Lenders shall be entitled to rely on the authority of any Person purporting to
be a Person authorized by the Borrower to give such notice and the
Administrative Agent and Lenders shall not have any liability to the Borrower or
other Person on account of any action taken or not taken by the Administrative
Agent or the Lenders in reliance upon such telephonic or facsimile notice. The
obligation of the Borrower to repay the Loans and all other Obligations
hereunder shall not be affected in any way or to any extent by any failure of
the Administrative Agent and the Lenders to receive written confirmation of any
telephonic or facsimile notice or the receipt by the Administrative Agent and
the Lenders of a confirmation which is at variance with the terms understood by
the Administrative Agent and the Lenders to be contained in any such telephonic
or facsimile notice.
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SECTION 10.2 WAIVER; AMENDMENTS.
(a) No failure or delay by the Administrative Agent or any Lender in
exercising any right or power hereunder or any other Loan Document, and no
course of dealing between the Borrower and the Administrative Agent or any
Lender, shall operate as a waiver thereof, nor shall any single or partial
exercise of any such right or power or any abandonment or discontinuance of
steps to enforce such right or power, preclude any other or further exercise
thereof or the exercise of any other right or power hereunder or thereunder. The
rights and remedies of the Administrative Agent and the Lenders hereunder and
under the other Loan Documents are cumulative and are not exclusive of any
rights or remedies provided by law. No waiver of any provision of this Agreement
or any other Loan Document or consent to any departure by the Borrower therefrom
shall in any event be effective unless the same shall be permitted by paragraph
(b) of this Section, and then such waiver or consent shall be effective only in
the specific instance and for the purpose for which given. Without limiting the
generality of the foregoing, the making of a Loan shall not be construed as a
waiver of any Default or Event of Default, regardless of whether the
Administrative Agent, any Lender may have had notice or knowledge of such
Default or Event of Default at the time.
(b) No amendment or waiver of any provision of this Agreement or the
other Loan Documents, nor consent to any departure by the Borrower therefrom,
shall in any event be effective unless the same shall be in writing and signed
by the Borrower and the Required Lenders or the Borrower and the Administrative
Agent with the consent of the Required Lenders and then such waiver or consent
shall be effective only in the specific instance and for the specific purpose
for which given; PROVIDED, that no amendment or waiver shall: (i) except as
expressly provided in SECTION 2.20, increase the Revolving Commitment of any
Lender without the written consent of such Lender, (ii) reduce the principal
amount of any Loan or reduce the rate of interest thereon, or reduce any fees
payable hereunder, without the written consent of each Lender affected thereby,
(iii) postpone the date fixed for any payment of any principal of, or interest
on, any Loan or interest thereon or any fees hereunder or reduce the amount of,
waive or excuse any such payment, or postpone the scheduled date for the
termination or reduction of any Revolving Commitment, without the written
consent of each Lender affected thereby, (iv) change SECTION 2.19 (b) or (c) in
a manner that would alter the pro rata sharing of payments required thereby ,
without the written consent of each Lender, (v) change any of the provisions of
this Section or the definition of "Required Lenders" or any other provision
hereof specifying the number or percentage of Lenders which are required to
waive, amend or modify any rights hereunder or make any determination or grant
any consent hereunder, without the consent of each Lender; (vi) release any
guarantor or limit the liability of any such guarantor under any guaranty
agreement, without the written consent of each Lender; or (vii) release all or
substantially all collateral (if any) securing any of the Obligations, without
the written consent of each Lender PROVIDED FURTHER, that no such agreement
shall amend, modify or otherwise affect the rights, duties or obligations of the
Administrative Agent without the prior written consent of the Administrative
Agent. No amendment which adversely affects the Borrower shall be entered into
without Borrower's written consent.
SECTION 10.3 EXPENSES; INDEMNIFICATION.
(a) The Borrower shall pay (i) all reasonable, out-of-pocket costs
and expenses of the Administrative Agent and its Affiliates, including the
51
reasonable fees, charges and disbursements of counsel for the Administrative
Agent and its Affiliates, in connection with the syndication of the credit
facilities provided for herein, the preparation and administration of the Loan
Documents and any amendments, modifications or waivers thereof (whether or not
the transactions contemplated in this Agreement or any other Loan Document shall
be consummated), and (ii) all out-of-pocket costs and expenses (including,
without limitation, the reasonable fees, charges and disbursements of outside
counsel) incurred by the Administrative Agent or any Lender in connection with
the enforcement or protection of its rights in connection with this Agreement,
including its rights under this Section, or in connection with the Loans made
hereunder, including all such out-of-pocket expenses incurred during any
workout, restructuring or negotiations in respect of such Loans.
(b) The Borrower shall indemnify the Administrative Agent (and any
sub-agent thereof), each Lender, and each 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 fees, charges and disbursements of any counsel
for any Indemnitee), and shall indemnify and hold harmless each Indemnitee from
all fees, time charges and disbursements for attorneys who may be employees of
any Indemnitee, incurred by any Indemnitee or asserted against any Indemnitee by
any third party, the 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, (ii) any Loan or the use or proposed use of the
proceeds therefrom, (iii) any actual or alleged presence or Release of Hazardous
Materials on or from any property owned or operated by the Borrower or any of
its Subsidiaries, or any Environmental Liability related in any way to the
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 any
third party, the Borrower or any other Loan Party, and regardless of whether any
Indemnitee is a party thereto, 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 or (y) result from a claim
brought by the 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 the 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.
(c) The Borrower shall pay, and hold the Administrative Agent and
each of the Lenders harmless from and against, any and all present and future
stamp, documentary, and other similar taxes with respect to this Agreement and
any other Loan Documents, any collateral that may be granted by Borrower or a
Subsidiary, or any payments due thereunder, and save the Administrative Agent
and each Lender harmless from and against any and all liabilities with respect
to or resulting from any delay or omission to pay such taxes.
(d) To the extent that the Borrower fails to pay any amount required
to be paid to the Administrative Agent under clauses (a), (b) or (c) hereof,
each Lender severally agrees to pay to the Administrative Agent such Lender's
52
Pro Rata Share (determined as of the time that the unreimbursed expense or
indemnity payment is sought) of such unpaid amount; PROVIDED, that the
unreimbursed expense or indemnified payment, claim, damage, liability or related
expense, as the case may be, was incurred by or asserted against the
Administrative Agent in its capacity as such.
(e) To the extent permitted by applicable law, the 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 actual or direct damages) arising out of, in connection with or as a
result of, this Agreement or any agreement or instrument contemplated hereby,
the transactions contemplated therein, any Loan or the use of proceeds thereof.
(f) All amounts due under this Section shall be payable promptly
after written demand therefor.
SECTION 10.4 SUCCESSORS AND ASSIGNS.
(a) 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 the Borrower may not assign or otherwise transfer
any of its rights or obligations hereunder without the prior written consent of
each Lender (and any attempted assignment or transfer by the Borrower without
such consent 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 and, to the
extent expressly contemplated hereby, the Related Parties of each of the
Administrative Agent and the Lenders) any legal or equitable right, remedy or
claim under or by reason of this Agreement.
(b) Any Lender may 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 Revolving Commitment and the 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 Revolving Commitment and the Loans at the time
owing to it or in the case of an assignment to a Lender, an Affiliate of a
Lender or an Approved Fund with respect to a Lender, the aggregate amount of the
Revolving Commitment (which for this purpose includes Loans outstanding
thereunder) of the assigning Lender subject to each such assignment (determined
as of the date the Assignment and Acceptance with respect to such assignment is
delivered to the Administrative Agent) shall not be less than $1,000,000, in the
case of any assignment of a Revolving Commitment, unless each of the
Administrative Agent and, so long as no Event of Default has occurred and is
continuing, the Borrower otherwise consents (each such consent not to be
unreasonably withheld or delayed), (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 Loan or the Revolving
Commitment assigned, except that this clause (ii) shall not prohibit any Lender
from assigning all or a portion of its rights and obligations among separate
Revolving Commitments on a non-pro rata basis, and (iii) the parties to each
assignment shall execute and deliver to the Administrative Agent an Assignment
and Acceptance, together with a processing and recordation fee of $1,000, and
the Eligible Assignee, if it shall not be a Lender, shall deliver to the
Administrative Agent an Administrative Questionnaire. Upon (i) the execution and
delivery of the Assignment and Acceptance by the assigning Lender and assignee
53
Lender, (ii) acceptance and recording thereof by the Administrative Agent
pursuant to paragraph (c) of this Section, (iii) consent thereof from the
Borrower to the extent required pursuant to this clause (b) and (iv) if such
assignee Lender is a Foreign Lender, compliance by such Person with SECTION
2.18(E), from and after the effective date specified in each Assignment and
Acceptance, the Eligible Assignee thereunder shall be a party hereto and, to the
extent of the interest assigned by such Assignment and Acceptance, 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 Acceptance, be released from its obligations under this Agreement
(and, in the case of an Assignment and Acceptance 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
2.16, 2.17, 2.18 and 10.3. Any assignment or transfer by a Lender of rights or
obligations under this Agreement that does not comply with this paragraph 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 paragraph (d) of
this Section.
(c) The Administrative Agent, acting solely for this purpose as an
agent of the Borrower, shall maintain at one of its offices in Atlanta, Georgia
a copy of each Assignment and Acceptance delivered to it and a register for the
recordation of the names and addresses of the Lenders, and the Revolving
Commitments of, and principal amount of the Loans 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 Borrower, the Administrative Agent and the
Lenders may treat each Person whose name is recorded in the Register pursuant to
the terms hereof as a Lender hereunder for all purposes of this Agreement,
notwithstanding notice to the contrary. The Register shall be available for
inspection by the Borrower and any Lender, at any reasonable time and from time
to time upon reasonable prior notice.
(d) Any Lender may, without the consent of, or notice to, the
Borrower or the Administrative Agent sell participations to one or more banks or
other entities (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
Revolving Commitment and/or the 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 Borrower, 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. 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, modification or waiver with respect to the following to the
extent affecting such Participant: (i) increase the Revolving Commitment of any
Lender without the written consent of such Lender, (ii) reduce the principal
amount of any Loan or reduce the rate of interest thereon, or reduce any fees
payable hereunder, without the written consent of each Lender affected thereby,
(iii) postpone the date fixed for any payment of any principal of, or interest
on, any Loan or interest thereon or any fees hereunder or reduce the amount of,
waive or excuse any such payment, or postpone the scheduled date for the
termination or reduction of any Revolving Commitment, without the written
consent of each Lender affected thereby, (iv) change SECTION 2.19(B) or (C) in a
manner that would alter the pro rata sharing of payments required thereby,
54
without the written consent of each Lender, (v) change any of the provisions of
this Section or the definition of "Required Lenders" or any other provision
hereof specifying the number or percentage of Lenders which are required to
waive, amend or modify any rights hereunder or make any determination or grant
any consent hereunder, without the consent of each Lender; (vi) release any
guarantor or limit the liability of any such guarantor under any guaranty
agreement without the written consent of each Lender except to the extent such
release is expressly provided under the terms of the Guaranty Agreement; or
(vii) release all or substantially all collateral (if any) securing any of the
Obligations. Subject to paragraph (e) of this Section, the Borrower agrees that
each Participant shall be entitled to the benefits of SECTIONS 2.16, 2.17, and
2.18 to the same extent as if it were a Lender and had acquired its interest by
assignment pursuant to paragraph (b) of this Section. To the extent permitted by
law, each Participant also shall be entitled to the benefits of SECTION 10.7 as
though it were a Lender, provided such Participant agrees to be subject to
SECTION 10.7 as though it were a Lender.
(e) A Participant shall not be entitled to receive any greater
payment under SECTION 2.16 and SECTION 2.18 than the applicable Lender would
have been entitled to receive with respect to the participation sold to such
Participant, unless the sale of the participation to such Participant is made
with the Borrower's prior written consent. A Participant that would be a Foreign
Lender if it were a Lender shall not be entitled to the benefits of SECTION 2.18
unless the Borrower is notified of the participation sold to such Participant
and such Participant agrees, for the benefit of the Borrower, to comply with
SECTION 2.18(E) as though it were a Lender.
(f) Any Lender may at any time pledge or assign a security interest
in all or any portion of its rights under this Agreement to secure obligations
of such Lender, including without limitation any pledge or assignment to secure
obligations to a Federal Reserve Bank; PROVIDED that no such pledge or
assignment of a security interest shall release a Lender from any of its
obligations hereunder or substitute any such pledgee or assignee for such Lender
as a party hereto.
SECTION 10.5 GOVERNING LAW; JURISDICTION; CONSENT TO SERVICE OF PROCESS.
(a) This Agreement and the other Loan Documents shall be construed
in accordance with and be governed by the law (without giving effect to the
conflict of law principles thereof) of the State of Georgia.
(b) The Borrower hereby irrevocably and unconditionally submits, for
itself and its property, to the non-exclusive jurisdiction of the United States
District Court of for the Northern District of Georgia, and of any state court
of the State of Georgia located in Xxxxxx County 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 the transactions contemplated hereby or
thereby, or for recognition or enforcement of any judgment, and each of the
parties hereto hereby irrevocably and unconditionally agrees that all claims in
respect of any such action or proceeding may be heard and determined in such
Georgia state court or, to the extent permitted by applicable law, 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 any other Loan Document shall affect any right that
55
the Administrative Agent or any Lender may otherwise have to bring any action or
proceeding relating to this Agreement or any other Loan Document against the
Borrower or its properties in the courts of any jurisdiction.
(c) The Borrower irrevocably and unconditionally waives any
objection which it may now or hereafter have to the laying of venue of any such
suit, action or proceeding described in paragraph (b) of this Section and
brought in any court referred to in paragraph (b) of this Section. Each of the
parties hereto irrevocably waives, to the fullest extent permitted by applicable
law, the defense of an inconvenient forum to the maintenance of such action or
proceeding in any such court.
(d) Each party to this Agreement irrevocably consents to the service
of process in the manner provided for notices in SECTION 10.1. Nothing in this
Agreement or in any other Loan Document will affect the right of any party
hereto to serve process in any other manner permitted by law.
SECTION 10.6 WAIVER OF JURY TRIAL. EACH PARTY HERETO 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 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 PARTY HAS
REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY 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.
SECTION 10.7 RIGHT OF SETOFF. In addition to any rights now or hereafter
granted under applicable law and not by way of limitation of any such rights,
each Lender shall have the right, at any time or from time to time upon the
occurrence and during the continuance of an Event of Default, without prior
notice to the Borrower, any such notice being expressly waived by the Borrower
to the extent permitted by applicable law, to set off and apply against all
deposits (general or special, time or demand, provisional or final) of the
Borrower at any time held or other obligations at any time owing by such Lender
to or for the credit or the account of the Borrower against any and all
Obligations held by such Lender, as the case may be, irrespective of whether
such Lender shall have made demand hereunder and although such Obligations may
be unmatured. Each Lender agree promptly to notify the Administrative Agent and
the Borrower after any such set-off and any application made by such Lender;
PROVIDED, that the failure to give such notice shall not affect the validity of
such set-off and application.
SECTION 10.8 COUNTERPARTS; INTEGRATION. This Agreement may be executed by
one or more of the parties to this Agreement on any number of separate
counterparts (including by telecopy), and all of said counterparts taken
together shall be deemed to constitute one and the same instrument. This
Agreement, the other Loan Documents, and any separate letter agreement(s)
56
relating to any fees payable to the Administrative Agent constitute the entire
agreement among the parties hereto and thereto regarding the subject matters
hereof and thereof and supersede all prior agreements and understandings, oral
or written, regarding such subject matters.
SECTION 10.9 SURVIVAL. All covenants, agreements, representations and
warranties made by the Borrower herein and in the certificates or other
instruments delivered in connection with or pursuant to this Agreement shall be
considered to have been relied upon by the other parties hereto and shall
survive the execution and delivery of this Agreement and the making of any
Loans, regardless of any investigation made by any such other party or on its
behalf and notwithstanding that the Administrative Agent or any Lender may have
had notice or knowledge of any Default or incorrect representation or warranty
at the time any credit is extended hereunder, and shall continue in full force
and effect as long as the principal of or any accrued interest on any Loan or
any fee or any other amount payable under this Agreement is outstanding and
unpaid and so long as the Revolving Commitments have not expired or terminated.
The provisions of SECTIONS 2.16, 2.17, 2.18, and 10.3 and Article IX shall
survive and remain in full force and effect regardless of the consummation of
the transactions contemplated hereby, the repayment of the Loans, the expiration
or termination of the Revolving Commitments or the termination of this Agreement
or any provision hereof. All representations and warranties made herein, in the
certificates, reports, notices, and other documents delivered pursuant to this
Agreement shall survive the execution and delivery of this Agreement and the
other Loan Documents, and the making of the Loans.
SECTION 10.10 SEVERABILITY. Any provision of this Agreement or any other
Loan Document held to be illegal, invalid or unenforceable in any jurisdiction,
shall, as to such jurisdiction, be ineffective to the extent of such illegality,
invalidity or unenforceability without affecting the legality, validity or
enforceability of the remaining provisions hereof or thereof; and the
illegality, invalidity or unenforceability of a particular provision in a
particular jurisdiction shall not invalidate or render unenforceable such
provision in any other jurisdiction.
SECTION 10.11 CONFIDENTIALITY. Each of the Administrative Agent and each
Lender agrees to take normal and reasonable precautions to maintain the
confidentiality of any information designated in writing as confidential and
provided to it by the Borrower or any Subsidiary, except that such information
may be disclosed (i) to any Related Party of the Administrative Agent or any
such Lender, including without limitation accountants, legal counsel and other
advisors, so long as such information remains confidential, (ii) to the extent
required by applicable laws or regulations or by any subpoena or similar legal
process, (iii) to the extent required by any regulatory agency or authority,
(iv) to the extent that such information becomes publicly available other than
as a result of a breach of this Section, or which becomes available to the
Administrative Agent, any Lender or any Related Party of any of the foregoing on
a nonconfidential basis from a source other than the Borrower, (v) in connection
with the exercise of any remedy hereunder or any suit, action or proceeding
relating to this Agreement or the enforcement of rights hereunder, (vi) subject
to provisions substantially similar to this SECTION 10.11, to any actual or
prospective assignee or Participant or to any prospective contractual
counterparty (or its advisor to any securitization, hedge or other derivative
transaction, or (vii) with the consent of the Borrower. Any Person required to
maintain the confidentiality of any information as provided for in this Section
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 reasonably accord its own confidential
information.
57
SECTION 10.12 INTEREST RATE LIMITATION. Notwithstanding anything herein to
the contrary, if at any time the interest rate applicable to any Loan, together
with all fees, charges and other amounts which may be treated as interest on
such Loan under applicable law (collectively, the "CHARGES"), shall exceed the
maximum lawful rate of interest (the "MAXIMUM RATE") which may be contracted
for, charged, taken, received or reserved by a Lender holding such Loan in
accordance with applicable law, the rate of interest payable in respect of such
Loan hereunder, together with all Charges payable in respect thereof, shall be
limited to the Maximum Rate and, to the extent lawful, the interest and Charges
that would have been payable in respect of such Loan but were not payable as a
result of the operation of this Section shall be cumulated and the interest and
Charges payable to such Lender in respect of other Loans or periods shall be
increased (but not above the Maximum Rate therefor) until such cumulated amount,
together with interest thereon at the Federal Funds Rate to the date of
repayment, shall have been received by such Lender.
SECTION 10.13 WAIVER OF EFFECT OF CORPORATE SEAL. The Borrower represents
and warrants that neither the Borrower nor any other Loan Party is required to
affix its corporate seal to this Agreement or any other Loan Document pursuant
to any requirement of law or regulation, agrees that this Agreement is delivered
such Borrower under seal and waives any shortening of the statute of limitations
that may result from not affixing the corporate seal to this Agreement or such
other Loan Documents.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their respective authorized officers as of the day and year
first above written.
LONE STAR STEAKHOUSE & SALOON, INC.
By: /s/
--------------------------------------------------
Name:
Title:
SUNTRUST BANK
as Administrative Agent and as a Lender
By: /s/
---------------------------------------------------
Name:
Title:
Revolving Commitment: $18,000,000.00
59
INTRUST BANK, N.A., as Lender
By: /s/
---------------------------------------------------
Name:
Title:
Revolving Commitment: $12,000,000.00
60
