AMENDED AND RESTATED CREDIT AGREEMENT
THIS AMENDED AND RESTATED CREDIT AGREEMENT (this "Agreement"), dated as of
July 27, 1998, is among SOS STAFFING SERVICES, INC., a Utah corporation (the
"Borrower"), THE FIRST NATIONAL BANK OF CHICAGO, a national banking association
("First Chicago"), FIRST SECURITY BANK, N.A., a national banking association
("First Security"), those other lenders from time to time party hereto (First
Chicago, First Security and such other lenders being referred to herein
individually as a "Lender" and collectively as the "Lenders"), First Chicago, as
documentation agent for the Lenders (in such capacity, the "Documentation
Agent"), and First Security, as administrative agent for the Lenders (in such
capacity, the "Administrative Agent"). The parties hereto agree as follows:
RECITALS
A. Pursuant to that certain Credit Agreement dated as of July 11, 1996
among the Borrower, First Chicago and First Security (as amended to date, the
"Existing Credit Agreement"), First Chicago and First Security have extended
credit to the Borrower on the terms and subject to the conditions set forth
therein.
B. The parties to the Existing Credit Agreement desire to amend the
Existing Credit Agreement and, for convenience of reference, to restate the
Existing Credit Agreement as so amended in its entirety by this Agreement.
NOW, THEREFORE, in consideration of the above Recitals and for other
good and valuable consideration, the receipt and adequacy of which are hereby
acknowledged, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS
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As used in this Agreement:
"Acquisition" means any transaction, or any series of related transactions,
consummated on or after the date of this Agreement, by which the Borrower or any
of its Subsidiaries (i) acquires any going business or all or substantially all
of the assets of any firm, partnership, corporation or limited liability
company, or division thereof, whether through purchase of assets, merger or
otherwise or (ii) directly or indirectly acquires (in one transaction or as the
most recent transaction in a series of transactions) at least a majority (in
number of votes) of the securities of a corporation which have ordinary voting
power for the election of directors (other than securities having such power
only by reason of the happening of a contingency) or a majority (by percentage
or voting power) of the outstanding ownership interests of a partnership or
limited liability company.
"Adjusted EBITDA" means, calculated for the four full consecutive fiscal
quarters ending on the date of determination, the sum of: (i) the EBITDA of the
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Borrower and its Subsidiaries on a consolidated basis during such period, plus
(ii) in the event the Borrower or any Subsidiary consummates any Acquisition
during such period where a proforma statement in connection therewith is filed
with the Securities and Exchange Commission on Form 8-K, the EBITDA of any such
acquired Person for the time during such period prior to such Acquisition.
"Advance" means a borrowing hereunder (or conversion or continuation
thereof) consisting of the aggregate amount of the several Loans made on the
same Borrowing Date (or date of conversion or continuation) by the Lenders to
the Borrower of the same Type and, in the case of Fixed Rate Advances, for the
same Interest Period.
"Affiliate" of any Person means any other Person directly or indirectly
controlling, controlled by or under common control with such Person. A Person
shall be deemed to control another Person if the controlling Person owns 10% or
more of any class of voting securities (or other ownership interests) of the
controlled Person or possesses, directly or indirectly, the power to direct or
cause the direction of the management or policies of the controlled Person,
whether through ownership of stock, by contract or otherwise.
"Administrative Agent" means First Security in its capacity as
administrative agent for the Lenders pursuant to Article X, and not in its
individual capacity as a Lender, and any successor Administrative Agent
appointed pursuant to Article X.
"Aggregate Commitment" means the aggregate of the Commitments of all the
Lenders, as reduced from time to time pursuant to the terms hereof.
"Agreement" means this credit agreement, as it may be amended or modified
and in effect from time to time.
"Agreement Accounting Principles" means generally accepted accounting
principles as in effect from time to time, applied in a manner consistent with
that used in preparing the financial statements referred to in Section 5.4.
"Alternate Base Rate" means, for any day, a rate of interest per annum
equal to the higher of (i) the Corporate Base Rate for such day and (ii) the
Federal Funds Effective Rate for such day plus 1/2% per annum.
"Applicable Fee Rate" in connection with the commitment fee payable
pursuant to Section 2.5 below means at any date the percentage per annum set
forth below and corresponding to the range of Total Indebtedness / Adjusted
EBITDA Ratio under which the Borrower's Total Indebtedness / Adjusted EBITDA
Ratio (as determined based on the financial statements delivered by the Borrower
pursuant to Section 6.1 below) falls for the fiscal quarter ended immediately
prior to such date. Any adjustment in the Applicable Fee Rate shall be effective
beginning on the first Business Day of the calendar month immediately following
the date by which the applicable financial statements are required to be
delivered pursuant to Section 6.1 below. The Applicable Fee Rate shall be the
highest percentage per annum set forth below in the event such applicable
financial statements are not delivered in accordance with Section 6.1 below.
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Total Indebtedness / Adjusted EBITDA Ratio Applicable Fee Rate
------------------------------------------ -------------------
Less than or equal to 2.25:1.00 0.25%
Greater than 2.25:1.00 0.30%
"Applicable Margin" in connection with the Eurodollar Rate or the Floating
Rate, as applicable, means at any date the percentage per annum set forth below
in the applicable category column and corresponding to the range of Total
Indebtedness / Adjusted EBITDA Ratio under which the Borrower's Total
Indebtedness / Adjusted EBITDA Ratio (as determined based on the financial
statements delivered by the Borrower pursuant to Section 6.1 below) falls for
the fiscal quarter ended immediately prior to such date. Any adjustment in the
Applicable Margin shall be effective beginning on the first Business Day of the
calendar month immediately following the date by which the applicable financial
statements are required to be delivered pursuant to Section 6.1 below. The
Applicable Margin shall be the highest percentage per annum set forth below in
the event such applicable financial statements are not delivered in accordance
with Section 6.1 below.
Total Indebtedness / Adjusted Applicable Margin in connection Applicable Margin in connection with
----------------------------- ----------------------------------------- ------------------------------------
EBITDA Ratio with the Eurodollar Rate the Floating Rate
----------------------------- ----------------------------------------- ------------------------------------
Less than or equal to 1.50:1.00 1.000% 0%
Greater than 1.50:1.00 but less than 1.250% 0%
or equal to 2.25:1.00
Greater than 2.25:1.00 1.600% 0%
"Article" means an article of this Agreement unless another document is
specifically referenced.
"Authorized Officer" means any of the Chairman, Chief Executive Officer,
President, Chief Financial Officer or Treasurer of the Borrower, acting singly.
"Borrower" means SOS Staffing Services, Inc., a Utah corporation, and its
successors and assigns.
"Borrowing Date" means a date on which an Advance is made hereunder.
"Borrowing Notice" is defined in Section 2.8.
"Business Day" means (i) with respect to any borrowing, payment or rate
selection of Eurodollar Advances, a day (other than a Saturday or Sunday) on
which banks generally are open in Salt Lake City, Chicago, Los Angeles and New
York for the conduct of substantially all of their commercial lending activities
and on which dealings in United States dollars are carried on in the London
interbank market and (ii) for all other purposes, a day (other than a Saturday
or Sunday) on which banks generally are open in Salt Lake City and Chicago for
the conduct of substantially all of their commercial lending activities.
"Capitalized Lease" of a Person means any lease of Property by such Person
as lessee which would be capitalized on a balance sheet of such Person prepared
in accordance with Agreement Accounting Principles.
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"Capitalized Lease Obligations" of a Person means the amount of the
obligations of such Person under Capitalized Leases which would be shown as a
liability on a balance sheet of such Person prepared in accordance with
Agreement Accounting Principles.
"Change in Control" with respect to the Borrower is deemed to have occurred
at such time as any of the following events shall occur:
(i) There shall be consummated any consolidation and merger of the
Borrower in which the Borrower is not the continuing or surviving corporation or
pursuant to which the voting stock of the Borrower would be converted into cash,
securities or other property; or
(ii)There is a report filed by any person, including such person's
Affiliates, on Schedule 13D or 14D-1 (or any successor schedule, form or report)
pursuant to the Securities Exchange Act of 1934 (the "Exchange Act"), disclosing
that such person (for the purposes of this definition only, the term "person" is
used as defined in Section 13(d)(3) or Section 14(d)(2) of the Exchange Act or
any successor provision to either of the foregoing) has become the beneficial
owner (as the term "beneficial owner" is defined under Rule 13d-3 or any
successor rule or regulation promulgated under the Exchange Act) of 50% or more
of the voting power of the Borrower's voting stock outstanding; provided,
however, that a Change in Control shall not be deemed to have occurred if at any
time the Borrower, any Subsidiary of the Borrower, any employee stock ownership
plan or any other employee benefit plan, including any pension plan of the
Borrower or any Subsidiary of the Borrower, or any person holding voting stock
for or pursuant to the terms of such employee benefit plan, files or becomes
obligated to file a report under or in response to Schedule 13D or Schedule
14D-1 (or any successor schedule, form or report) under the Exchange Act
disclosing beneficial ownership by it of shares of voting stock in the Borrower,
whether in excess of 50% or otherwise.
"Change in Control Notice" is defined in Section 2.18.
"Code" means the Internal Revenue Code of 1986, as amended, reformed or
otherwise modified from time to time.
"Commitment" means, for each Lender, the obligation of such Lender to make
Loans not exceeding the amount for such Lender set forth in the most current
commitment schedule provided to the Borrower and the Lenders by the
Documentation Agent (as such schedule may be modified from time to time pursuant
to the terms hereof, with the initial commitment schedule being attached hereto
as Schedule 4).
"Condemnation" is defined in Section 7.8.
"Contingent Obligation" of a Person means any agreement, undertaking or
arrangement by which such Person assumes, guarantees, endorses, contingently
agrees to purchase or provide funds for the payment of, or otherwise becomes or
is contingently liable upon, the obligation or liability of any other Person, or
agrees to maintain the net worth or working capital or other financial condition
of any other Person, or otherwise assures any creditor of such other Person
against loss, including, without limitation, any comfort letter, operating
agreement, take-or-pay contract or obligations in connection with letters of
credit.
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"Conversion/Continuation Notice" is defined in Section 2.9.
"Controlled Group" means all members of a controlled group of corporations
and all trades or businesses (whether or not incorporated) under common control
which, together with the Borrower or any of its Subsidiaries, are treated as a
single employer under Section 414 of the Code.
"Corporate Base Rate" means a rate per annum equal to the corporate base
rate of interest announced by the Administrative Agent from time to time,
changing when and as said corporate base rate changes.
"Default" means an event described in Article VII.
"Documentation Agent" means First Chicago in its capacity as documentation
agent for the Lenders pursuant to Article X, and not in its individual capacity
as a Lender, and any successor Documentation Agent appointed pursuant to Article
X.
"EBITDA" means, for any period and with respect to any Person and all such
Person's Subsidiaries on a consolidated basis, (i) the net earnings (or loss)
after taxes for such period taken as a single accounting period, plus (ii)
depreciation, depletion and amortization expense for such period, plus (iii)
federal, state and local income (or equivalent) taxes paid or accrued for such
period, plus (iv) total interest expense for such period (including amortization
of capitalized Indebtedness issuance costs), whether paid or accrued (including
the interest component of Capitalized Leases), including all commissions,
discounts and other fees and charges owed with respect to letters of credit,
plus (v) extraordinary, unusual or non-recurring losses and non-cash charges for
any disposition of businesses or early extinguishment of Indebtedness for such
period, minus (vi) any cash payments with respect to any non-cash charges and
expenses related to the disposition of businesses or early extinguishment of
Indebtedness previously taken into account for such period, in each case
determined in accordance with Agreement Accounting Principles and, in the case
of clauses (ii) through (vi), to the extent included in the determination of net
earnings (or loss) for such period.
"Environmental Laws" means any and all federal, state, local and foreign
statutes, laws, judicial decisions, regulations, ordinances, rules, judgments,
orders, decrees, plans, injunctions, permits, concessions, grants, franchises,
licenses, agreements and other governmental restrictions relating to (i) the
protection of the environment, (ii) the effect of the environment on human
health, (iii) emissions, discharges or releases of pollutants, contaminants,
hazardous substances or wastes into surface water, ground water or land, or (iv)
the manufacture, processing, distribution, use, treatment, storage, disposal,
transport or handling of pollutants, contaminants, hazardous substances or
wastes or the clean-up or other remediation thereof.
"ERISA" means the Employee Retirement Income Security Act of l974, as
amended from time to time, and any rule or regulation issued thereunder.
"Eurodollar Advance" means an Advance which bears interest at a Eurodollar
Rate.
"Eurodollar Base Rate" means, with respect to a Eurodollar Advance for the
relevant Eurodollar Interest Period, the rate determined by the Administrative
Agent to be the rate at which the Administrative Agent offers to place deposits
in U.S. dollars with first-class banks in the London interbank market at
approximately 11 a.m. (London time) two Business Days prior to the first day of
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such Eurodollar Interest Period, in the approximate amount of the Administrative
Agent's (in its capacity as a Lender) relevant Eurodollar Loan and having a
maturity approximately equal to such Eurodollar Interest Period.
"Eurodollar Interest Period" means, with respect to a Eurodollar Advance, a
period of one, two, three or six months commencing on a Business Day selected by
the Borrower pursuant to this Agreement. Such Eurodollar Interest Period shall
end on the day which corresponds numerically to such date one, two, three or six
months thereafter, provided, however, that if there is no such numerically
corresponding day in such next, second, third or sixth succeeding month, such
Eurodollar Interest Period shall end on the last Business Day of such next,
second, third or sixth succeeding month. If a Eurodollar Interest Period would
otherwise end on a day which is not a Business Day, such Eurodollar Interest
Period shall end on the next succeeding Business Day, provided, however, that if
said next succeeding Business Day falls in a new calendar month, such Eurodollar
Interest Period shall end on the immediately preceding Business Day.
"Eurodollar Loan" means a Loan which bears interest at a Eurodollar Rate.
"Eurodollar Rate" means, with respect to a Eurodollar Advance for the
relevant Eurodollar Interest Period, the sum of (i) the quotient of (a) the
Eurodollar Base Rate applicable to such Eurodollar Interest Period, divided by
(b) one minus the Reserve Requirement (expressed as a decimal) applicable to
such Eurodollar Interest Period, plus (ii) the Applicable Margin. The Eurodollar
Rate shall be rounded to the next higher multiple of 1/16 of 1% if the rate is
not such a multiple.
"Existing Credit Agreement" has the meaning set forth in Recital A above.
"Facility Termination Date" means July 1, 2001, as such date may be
extended by written agreement of the Borrower, the Administrative Agent, the
Documentation Agent and the Lenders, or any earlier date on which the Aggregate
Commitment is reduced to zero or otherwise terminated pursuant to the terms
hereof.
"Federal Funds Effective Rate" means, for any day, an interest rate per
annum equal to the weighted average of the rates on overnight Federal funds
transactions with members of the Federal Reserve System arranged by Federal
funds brokers on such day, as published for such day (or, if such day is not a
Business Day, for the immediately preceding Business Day) by the Federal Reserve
Bank of New York, or, if such rate is not so published for any day which is a
Business Day, the average of the quotations at approximately 9 a.m. (Salt Lake
City time) on such day on such transactions received by the Administrative Agent
from three Federal funds brokers of recognized standing selected by the
Administrative Agent in its sole discretion.
"First Chicago" means The First National Bank of Chicago, a national
banking association, in its individual capacity, and its successors.
"First Security" means First Security Bank, N.A., a national banking
association, in its individual capacity, and its successors.
"Fixed Rate" means the Eurodollar Rate.
"Fixed Rate Advance" means an Advance which bears interest at a Fixed Rate.
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"Fixed Rate Loan" means a Loan which bears interest at a Fixed Rate.
"Floating Rate" means, for any day, a rate per annum equal to (i) the
Alternate Base Rate for such day plus (ii) the Applicable Margin, changing when
and as the Alternate Base Rate changes.
"Floating Rate Advance" means an Advance which bears interest at the
Floating Rate.
"Floating Rate Loan" means a Loan which bears interest at the Floating
Rate.
"Guarantor" means each of the now existing or hereafter established or
acquired Subsidiary of the Borrower, and its respective successors and assigns.
"Guaranty" means a guaranty executed by a Guarantor in favor of the
Documentation Agent, for the ratable benefit of the Lenders, in the form of
Exhibit F hereto, as it may be amended or modified and in effect from time to
time.
"Indebtedness" of a Person means, without duplication, such Person's (i)
obligations for borrowed money, (ii) obligations representing the deferred
purchase price of Property or services (other than accounts payable arising in
the ordinary course of such Person's business payable on terms customary in the
trade), (iii) obligations, whether or not assumed, secured by Liens or payable
out of the proceeds or production from property now or hereafter owned or
acquired by such Person, (iv) obligations which are evidenced by notes,
acceptances, or other instruments, (v) Capitalized Lease Obligations, and (vi)
Contingent Obligations.
"Interest Charges" means, for any period and with respect to any Person,
the sum, without duplication, of (a) interest paid or payable during such period
by such Person on Indebtedness of such Person, plus (b) all debt discount and
expense amortized or required to be amortized during such period by such Person,
plus (c) all obligations of such Person in respect of any interest rate or
currency swap, rate cap or similar transaction paid or required to be paid
during such period by such Person.
"Interest Coverage Ratio" means, for any period and with respect to any
Person, the ratio of (a) EBITDA of such Person for such period, to (b) the
Interest Charges of such Person for such period, in each case determined in
accordance with Agreement Accounting Principles.
"Interest Period" means a Eurodollar Interest Period.
"Investment" of a Person means any loan, advance (other than commission,
travel and similar advances to officers and employees made in the ordinary
course of business), extension of credit (other than accounts receivable arising
in the ordinary course of business on terms customary in the trade) or
contribution of capital by such Person; stocks, bonds, mutual funds, partnership
interests, notes, debentures or other securities owned by such Person; any
deposit accounts and certificate of deposit owned by such Person; and structured
notes, derivative financial instruments and other similar instruments or
contracts owned by such Person.
"L/C Documents" has the meaning given such term in Section 2.19 below.
"L/C Drawing" has the meaning given such term in Section 2.21 below.
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"Lenders" means the lending institutions listed on the signature pages of
this Agreement and their respective successors and assigns.
"Lending Installation" means, with respect to a Lender, the Administrative
Agent or the Documentation Agent, any office, branch, subsidiary or affiliate of
such Lender, the Administrative Agent or the Documentation Agent.
"Letter of Credit" has the meaning given such term in Section 2.19 below.
"Letter of Credit Application" means an application for the issuance of a
Letter of Credit in form satisfactory to the Administrative Agent.
"Lien" means any lien (statutory or other), mortgage, pledge,
hypothecation, assignment, deposit arrangement, encumbrance or preference,
priority or other security agreement or preferential arrangement of any kind or
nature whatsoever (including, without limitation, the interest of a vendor or
lessor under any conditional sale, Capitalized Lease or other title retention
agreement).
"Loan" means, with respect to a Lender, such Lender's loan made pursuant to
Article II (or any conversion or continuation thereof).
"Loan Documents" means this Agreement, the Notes, the Guaranties, the
Subordination Agreements and the other documents and agreements contemplated
hereby and executed by the Borrower or any Guarantor in favor of the
Documentation Agent, the Administrative Agent or any Lender.
"Material Adverse Effect" means a material adverse effect on (i) the
business, Property, condition (financial or otherwise), results of operations,
or prospects of the Borrower and its Subsidiaries taken as a whole, (ii) the
ability of the Borrower or any Guarantor to perform its obligations under the
Loan Documents (provided that any such effect with respect to the Borrower or
any Guarantor shall not constitute a Material Adverse Effect if not more than
ten percent (10%) of the total assets of the Borrower and its Subsidiaries on a
consolidated basis is affected adversely by such effect), or (iii) the validity
or enforceability of any of the Loan Documents or the rights or remedies of the
Documentation Agent, the Administrative Agent or the Lenders thereunder.
"Net Worth" means as to any Person the net worth of such Person and its
consolidated Subsidiaries, determined in accordance with Agreement Accounting
Principles.
"Note" means a promissory note, in substantially the form of Exhibit "A"
hereto, duly executed by the Borrower and payable to the order of a Lender in
the amount of its Commitment, including any amendment, modification, renewal or
replacement of such promissory note.
"Notice of Assignment" is defined in Section 12.3.2.
"Obligations" means all unpaid principal of and accrued and unpaid interest
on the Notes, the Outstanding Letters of Credit, and unrepaid L/C Drawings, all
accrued and unpaid fees and all expenses, reimbursements, indemnities and other
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obligations of the Borrower to the Lenders or to any Lender, the Administrative
Agent, the Documentation Agent or any indemnified party hereunder arising under
the Loan Documents.
"Outstanding" shall mean with respect to Letters of Credit, any Letter of
Credit which has not been canceled, expired unutilized or fully drawn upon and
reference to the "amount" of any Outstanding Letter of Credit shall be deemed to
mean an amount available for drawing thereunder.
"Participants" is defined in Section 12.2.1.
"Payment Date" means the last day of each calendar quarter.
"PBGC" means the Pension Benefit Guaranty Corporation, or any successor
thereto.
"Person" means any natural person, corporation, firm, joint venture,
partnership, association, enterprise, trust or other entity or organization, or
any government or political subdivision or any agency, department or
instrumentality thereof.
"Plan" means an employee pension benefit plan which is covered by Title IV
of ERISA or subject to the minimum funding standards under Section 412 of the
Code as to which the Borrower or any member of the Controlled Group may have any
liability.
"Property" of a Person means any and all property, whether real, personal,
tangible, intangible, or mixed, of such Person, or other assets owned, leased or
operated by such Person.
"Purchasers" is defined in Section 12.3.1.
"Rate Hedging Agreement" means an agreement, device or arrangement
providing for payments which are related to fluctuations of interest rates,
exchange rates or forward rates, including, but not limited to,
dollar-denominated or cross-currency interest rate exchange agreements, forward
currency exchange agreements, interest rate cap or collar protection agreements,
forward rate currency or interest rate options, puts and warrants.
"Rate Hedging Obligations" of a Person means any and all obligations of
such Person, whether absolute or contingent and howsoever and whensoever
created, arising, evidenced or acquired (including all renewals, extensions and
modifications thereof and substitutions therefor), under (i) any and all Rate
Hedging Agreements, and (ii) any and all cancellations, buy backs, reversals,
terminations or assignments of any Rate Hedging Agreement.
"Regulation D" means Regulation D of the Board of Governors of the Federal
Reserve System as from time to time in effect and any successor thereto or other
regulation or official interpretation of said Board of Governors relating to
reserve requirements applicable to member banks of the Federal Reserve System.
"Regulation U" means Regulation U of the Board of Governors of the Federal
Reserve System as from time to time in effect and any successor or other
regulation or official interpretation of said Board of Governors relating to the
extension of credit by banks for the purpose of purchasing or carrying margin
stocks applicable to member banks of the Federal Reserve System.
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"Reportable Event" means a reportable event as defined in Section 4043 of
ERISA and the regulations issued under such section, with respect to a Plan,
excluding, however, such events as to which the PBGC by regulation waived the
requirement of Section 4043(a) of ERISA that it be notified within 30 days of
the occurrence of such event, provided, however, that a failure to meet the
minimum funding standard of Section 412 of the Code and of Section 302 of ERISA
shall be a Reportable Event regardless of the issuance of any such waiver of the
notice requirement in accordance with either Section 4043(a) of ERISA or Section
412(d) of the Code.
"Required Lenders" means Lenders in the aggregate having at least 51% of
the Aggregate Commitment or, if the Aggregate Commitment has been terminated,
Lenders in the aggregate holding at least 51% of the aggregate unpaid principal
amount of the outstanding Advances; provided, however, that if there are only
two Lenders hereunder, Required Lenders shall include both Lenders.
"Reserve Requirement" means, with respect to a Eurodollar Interest Period,
the maximum aggregate reserve requirement (including all basic, supplemental,
marginal and other reserves) which is imposed under Regulation D on Eurocurrency
liabilities.
"Section" means a numbered section of this Agreement, unless another
document is specifically referenced.
"Single Employer Plan" means a Plan maintained by the Borrower or any
member of the Controlled Group for employees of the Borrower or any member of
the Controlled Group.
"Subordination Agreement" means a subordination agreement executed by a
Guarantor in favor of the Documentation Agent, for the ratable benefit of the
Lenders, in the form of Exhibit G hereto, as it may be amended or modified and
in effect from time to time.
"Subsidiary" of a Person means (i) any corporation more than 50% of the
outstanding securities having ordinary voting power of which shall at the time
be owned or controlled, directly or indirectly, by such Person or by one or more
of its Subsidiaries or by such Person and one or more of its Subsidiaries, or
(ii) any partnership, limited liability company, association, joint venture or
similar business organization more than 50% of the ownership interests having
ordinary voting power of which shall at the time be so owned or controlled.
Unless otherwise expressly provided, all references herein to a "Subsidiary"
shall mean a Subsidiary of the Borrower.
"Substantial Portion" means, with respect to the Property of the Borrower
and its Subsidiaries, Property which represents more than 10% of the
consolidated assets of the Borrower and its Subsidiaries as would be shown in
the consolidated financial statements of the Borrower and its Subsidiaries as at
the beginning of the twelve-month period ending with the month in which such
determination is made.
"Total Capital" means, as of any date of determination, the Total
Indebtedness plus the Net Worth of the Borrower and its consolidated
Subsidiaries.
"Total Indebtedness" means, as of any date of determination, the amount
(determined in conformity with Agreement Accounting Principles) of (i) the
Obligations, plus (ii) all other outstanding Indebtedness of the Borrower and
all its Subsidiaries, determined on a consolidated basis, created or assumed by
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any of such Persons, plus (iii) all other outstanding Indebtedness of the
Borrower and all its Subsidiaries which arises under a revolving credit or
similar agreement which obligates the lender or lenders to extend credit.
"Total Indebtedness / Adjusted EBITDA Ratio" means, as of any date of
determination, the quotient of the Total Indebtedness of the Borrower and its
Subsidiaries (determined on a consolidated basis) as of such date divided by the
Adjusted EBITDA of the Borrower and its Subsidiaries (determined on a
consolidated basis) as of such date.
"Transferee" is defined in Section 12.4.
"Type" means, with respect to any Advance, its nature as a Floating Rate
Advance or a Eurodollar Advance.
"Unfunded Liabilities" means the amount (if any) by which the present value
of all vested and unvested accrued benefits under all Single Employer Plans
exceeds the fair market value of all such Plan assets allocable to such
benefits, all determined as of the then most recent valuation date for such
Plans using PBGC actuarial assumptions for single employer plan terminations.
"Unmatured Default" means an event which but for the lapse of time or the
giving of notice, or both, would constitute a Default.
"Wholly-Owned Subsidiary" of a Person means (i) any Subsidiary all of the
outstanding voting securities of which shall at the time be owned or controlled,
directly or indirectly, by such Person or one or more Wholly-Owned Subsidiaries
of such Person, or by such Person and one or more Wholly-Owned Subsidiaries of
such Person, or (ii) any partnership, limited liability company, association,
joint venture or similar business organization 100% of the ownership interests
having ordinary voting power of which shall at the time be so owned or
controlled.
"Year 2000 Issues" means anticipated costs, problems and uncertainties
associated with the inability of certain computer applications to effectively
handle data including dates on and after January 1, 2000, as such inability
affects the business, operations and financial condition of the Borrower and its
Subsidiaries and of the Borrower's and its Subsidiaries' material customers,
suppliers and vendors.
"Year 2000 Program" is defined in Section 5.19.
The foregoing definitions shall be equally applicable to both the singular
and plural forms of the defined terms.
ARTICLE II
THE CREDITS
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2.1. Commitment. From and including the date of this Agreement and prior
to the Facility Termination Date, each Lender severally agrees, on the terms and
conditions set forth in this Agreement, to make Loans to the Borrower from time
to time in amounts not to exceed in the aggregate at any one time outstanding
the amount of its Commitment; provided, however, that the aggregate amount of
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Loans made by all Lenders at any one time outstanding shall not exceed the
Aggregate Commitment minus the aggregate dollar amount of Outstanding Letters of
Credit and unrepaid L/C Drawings on such date. Subject to the terms of this
Agreement, the Borrower may borrow, repay and reborrow at any time prior to the
Facility Termination Date. The Commitments to lend hereunder shall expire on the
Facility Termination Date.
2.2. Required Payments. Any outstanding Advances and all other unpaid
Obligations shall be paid in full by the Borrower on the Facility Termination
Date. In addition, all proceeds from any material sale of assets and from any
issuance of equity by the Borrower or any of its Subsidiaries shall be used to
repay any outstanding Advances hereunder.
2.3. Ratable Loans. Each Advance hereunder shall consist of Loans made
from the several Lenders ratably in proportion to the ratio that their
respective Commitments bear to the Aggregate Commitment.
2.4. Types of Advances. The Advances may be Floating Rate Advances or
Eurodollar Advances, or a combination thereof, selected by the Borrower in
accordance with Sections 2.8 and 2.9.
2.5. Commitment Fee; Reductions in Aggregate Commitment. The Borrower
agrees to pay to the Administrative Agent for the account of each Lender a
commitment fee equal to the Applicable Fee Rate multiplied by the amount,
calculated daily, equal to such Lender's Commitment minus such Lender's pro rata
share of all outstanding Loans and Advances, Outstanding Letters of Credit and
unrepaid L/C Drawings, from the date hereof to and including the Facility
Termination Date, payable quarterly, in arrears, on the last day of each
calendar quarter and on the Facility Termination Date. The Borrower may
permanently reduce the Aggregate Commitment in whole, or in part ratably among
the Lenders in the minimum amount of $500,000 and integral multiples of $100,000
in excess thereof, upon at least ten Business Days' written notice to the
Administrative Agent, which notice shall specify the amount of any such
reduction, provided, however, that the amount of the Aggregate Commitment may
not be reduced below the aggregate principal amount of the outstanding Advances.
All accrued commitment fees shall be payable on the effective date of any
termination of the obligations of the Lenders to make Loans hereunder.
2.6. Minimum Amount of Each Advance. Each Fixed Rate Advance shall be in
the minimum amount of $1,000,000 (and in multiples of $100,000 if in excess
thereof), and each Floating Rate Advance shall be in the minimum amount of
$100,000 (and in multiples of $100,000 if in excess thereof), provided, however,
that any Floating Rate Advance may be in the amount of the unused Aggregate
Commitment.
2.7. Optional Principal Payments. The Borrower may from time to time pay,
without penalty or premium, all outstanding Floating Rate Advances, or, in a
minimum aggregate amount of $100,000 or any integral multiple of $100,000 in
excess thereof, any portion of the outstanding Floating Rate Advances upon two
Business Days' prior notice to the Administrative Agent. A Fixed Rate Advance
may not be paid prior to the last day of the applicable Interest Period.
2.8. Method of Selecting Types and Interest Periods for New Advances. The
Borrower shall select the Type of Advance and, in the case of each Fixed Rate
Advance, the Interest Period applicable to each Advance from time to time. The
Borrower shall give the Administrative Agent irrevocable notice (a "Borrowing
Notice") not later than 9:00 a.m. (Salt Lake City time) at least one Business
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Day before the Borrowing Date of each Floating Rate Advance, and three Business
Days before the Borrowing Date for each Eurodollar Advance, specifying:
(i) the Borrowing Date, which shall be a Business Day, of such
Advance,
(ii) the aggregate amount of such Advance,
(iii) the Type of Advance selected, and
(iv) in the case of each Fixed Rate Advance, the Interest Period
applicable thereto.
Not later than 11:00 a.m. (Salt Lake City time) on each Borrowing Date, each
Lender shall make available its Loan or Loans, in funds immediately available in
Salt Lake City to the Administrative Agent at its address specified pursuant to
Article XIII. The Administrative Agent will make the funds so received from the
Lenders available to the Borrower at the Administrative Agent's aforesaid
address.
2.9. Conversion and Continuation of Outstanding Advances. Floating Rate
Advances shall continue as Floating Rate Advances unless and until such Floating
Rate Advances are converted into Fixed Rate Advances. Each Fixed Rate Advance
shall continue as a Fixed Rate Advance until the end of the then applicable
Interest Period therefor, at which time such Fixed Rate Advance shall be
automatically converted into a Floating Rate Advance unless the Borrower shall
have given the Administrative Agent a Conversion/Continuation Notice requesting
that, at the end of such Interest Period, such Fixed Rate Advance either
continue as a Fixed Rate Advance for the same or another Interest Period or be
converted into an Advance of another Type. Subject to the terms of Section 2.6,
the Borrower may elect from time to time to convert all or any part of an
Advance of any Type into any other Type of Advances; provided that any
conversion of any Fixed Rate Advance shall be made on, and only on, the last day
of the Interest Period applicable thereto. The Borrower shall give the
Administrative Agent irrevocable notice (a "Conversion/Continuation Notice") of
each conversion of an Advance or continuation of a Fixed Rate Advance not later
than 9:00 a.m. (Salt Lake City time) at least one Business Day, in the case of a
conversion into a Floating Rate Advance, or three Business Days, in the case of
a conversion into or continuation of a Fixed Rate Advance, prior to the date of
the requested conversion or continuation, specifying:
(i) the requested date which shall be a Business Day, of such
conversion or continuation,
(ii) the aggregate amount and Type of the Advance which is to be
converted or continued, and
(iii) the amount and Type(s) of Advance(s) into which such Advance
is to be converted or continued and, in the case of a
conversion into or continuation of a Fixed Rate Advance, the
duration of the Interest Period applicable thereto.
2.10. Changes in Interest Rate, etc. Each Floating Rate Advance shall bear
interest on the outstanding principal amount thereof, for each day from and
including the date such Advance is made or is converted from a Fixed Rate
Advance into a Floating Rate Advance pursuant to Section 2.9 to but excluding
the date it becomes due or is converted into a Fixed Rate Advance pursuant to
Section 2.9 hereof, at a rate per annum equal to the Floating Rate for such day.
Changes in the rate of interest on that portion of any Advance maintained as a
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Floating Rate Advance will take effect simultaneously with each change in the
Alternate Base Rate. Each Fixed Rate Advance shall bear interest on the
outstanding principal amount thereof from and including the first day of the
Interest Period applicable thereto to (but not including) the last day of such
Interest Period at the interest rate determined as applicable to such Fixed Rate
Advance. No Interest Period may end after the Facility Termination Date.
2.11. Rates Applicable After Default. Notwithstanding anything to the
contrary contained in Section 2.8 or 2.9, during the continuance of a Default
the Required Lenders may, at their option, by notice to the Borrower (which
notice may be revoked at the option of the Required Lenders notwithstanding any
provision of Section 8.2 requiring unanimous consent of the Lenders to changes
in interest rates), declare that no Advance may be made as, converted into or
continued as a Fixed Rate Advance. If any Advance is not paid at maturity,
whether by acceleration or otherwise, or any L/C Drawing is not paid when due,
the Required Lenders may, at their option, by notice to the Borrower (which
notice may be revoked at the option of the Required Lenders notwithstanding any
provision of Section 8.2 requiring unanimous consent of the Lenders to changes
in interest rates), declare that all outstanding Obligations (including any
Advance and any unrepaid L/C Drawing) shall bear interest at a rate per annum
equal to the Floating Rate plus 2% per annum.
2.12. Method of Payment. All payments of the Obligations hereunder shall
be made, without setoff, deduction, or counterclaim, in immediately available
funds to the Administrative Agent at the Administrative Agent's address
specified pursuant to Article XIII, or at any other Lending Installation of the
Administrative Agent specified in writing by the Administrative Agent to the
Borrower, by noon (local time) on the date when due and shall be applied ratably
by the Administrative Agent among the Lenders. Each payment delivered to the
Administrative Agent for the account of any Lender shall be delivered promptly
by the Administrative Agent to such Lender in the same type of funds that the
Administrative Agent received at its address specified pursuant to Article XIII
or at any Lending Installation specified in a notice received by the
Administrative Agent from such Lender. The Administrative Agent is hereby
authorized to charge the account of the Borrower maintained with the
Administrative Agent for each payment of principal, interest and fees as it
becomes due hereunder.
2.13. Notes; Telephonic Notices. Each Lender is hereby authorized to
record the principal amount of each of its Loans and each repayment on the
schedule attached to its Note, provided, however, that neither the failure to so
record nor any error in such recordation shall affect the Borrower's obligations
under such Note. The Borrower hereby authorizes the Lenders and the
Administrative Agent to extend, convert or continue Advances, effect selections
of Types of Advances and to transfer funds based on telephonic notices made by
any person or persons the Administrative Agent or any Lender in good faith
believes to be acting on behalf of the Borrower. The Borrower agrees to deliver
promptly to the Administrative Agent a written confirmation, if such
confirmation is requested by the Administrative Agent or any Lender, of each
telephonic notice signed by an Authorized Officer. The Administrative Agent and
the Lenders shall be entitled to rely on any such telephonic notice and take
actions pursuant thereto without any written confirmation (if none has been
requested) or prior to the receipt of any written confirmation (if one has been
requested). If the related written confirmation differs in any material respect
from the action taken by the Administrative Agent and the Lenders, the records
of the Administrative Agent and the Lenders shall govern absent manifest error.
2.14. Interest Payment Dates; Interest and Fee Basis. Interest accrued on
each Floating Rate Advance shall be payable on the last day of each month,
commencing with the first such date to occur after the date hereof, on any date
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on which the Floating Rate Advance is prepaid, whether due to acceleration or
otherwise, and at maturity. Interest accrued on that portion of the outstanding
principal amount of any Floating Rate Advance converted into a Fixed Rate
Advance on a day other than a Payment Date shall be payable on the date of
conversion. Interest accrued on each Fixed Rate Advance shall be payable on the
last day of its applicable Interest Period, on any date on which the Fixed Rate
Advance is prepaid, whether by acceleration or otherwise, and at maturity.
Interest accrued on each Fixed Rate Advance having an Interest Period longer
than three months shall also be payable on the last day of each three-month
interval during such Interest Period. Interest on Fixed Rate Loans, commitment
fees and letter of credit fees shall be calculated for actual days elapsed on
the basis of a 360-day year. Interest on Floating Rate Loans shall be calculated
for actual days elapsed on the basis of a 365-, or when appropriate 366-, day
year. Interest shall be payable for the day an Advance is made but not for the
day of any payment on the amount paid if payment is received prior to noon
(local time) at the place of payment. If any payment of principal of or interest
on an Advance shall become due on a day which is not a Business Day, such
payment shall be made on the next succeeding Business Day and, in the case of a
principal payment, such extension of time shall be included in computing
interest in connection with such payment.
2.15. Notification of Advances, Interest Rates, Prepayments and Commitment
Reductions. Promptly after receipt thereof, the Administrative Agent will notify
each Lender of the contents of each Aggregate Commitment reduction notice,
Borrowing Notice, Conversion/Continuation Notice, and repayment notice received
by it hereunder. The Administrative Agent will notify each Lender of the
interest rate applicable to each Fixed Rate Advance promptly upon determination
of such interest rate and will give each Lender prompt notice of each change in
the Alternate Base Rate.
2.16. Lending Installations. Each Lender may book its Loans at any Lending
Installation selected by such Lender and may change its Lending Installation
from time to time. All terms of this Agreement shall apply to any such Lending
Installation and the Notes shall be deemed held by each Lender for the benefit
of such Lending Installation. Each Lender may, by written or telex notice to the
Administrative Agent and the Borrower, designate a Lending Installation through
which Loans will be made by it and for whose account Loan payments are to be
made.
2.17. Non-Receipt of Funds by the Administrative Agent.Unless the Borrower
or a Lender, as the case may be, notifies the Administrative Agent prior to the
date on which it is scheduled to make payment to the Administrative Agent of (i)
in the case of a Lender, the proceeds of a Loan or (ii) in the case of the
Borrower, a payment of principal, interest or fees to the Administrative Agent
for the account of the Lenders, that it does not intend to make such payment,
the Administrative Agent may assume that such payment has been made. The
Administrative Agent may, but shall not be obligated to, make the amount of such
payment available to the intended recipient in reliance upon such assumption. If
such Lender or the Borrower, as the case may be, has not in fact made such
payment to the Administrative Agent, the recipient of such payment shall, on
demand by the Administrative Agent, repay to the Administrative Agent the amount
so made available together with interest thereon in respect of each day during
the period commencing on the date such amount was so made available by the
Administrative Agent until the date the Administrative Agent recovers such
amount at a rate per annum equal to (i) in the case of payment by a Lender, the
Federal Funds Effective Rate for such day or (ii) in the case of payment by the
Borrower, the interest rate applicable to the relevant Loan.
2.18. Mandatory Prepayment in the Event of a Change in Control. No later
than ten (10) Business Days prior to the consummation of any transaction which
would cause a Change in Control, the Borrower shall notify (a "Change in Control
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Notice") the Administrative Agent and the Documentation Agent (and the
Documentation Agent shall promptly forward a copy of such Change in Control
Notice to each Lender) of such expected transaction, including within such
Change in Control Notice the expected closing date of such transaction. Within
five (5) Business Days of receipt of such Change in Control Notice by any
Lender, such Lender may, at its option, give notice to the Administrative Agent,
the Documentation Agent and the Borrower that such Lender elects to terminate
its Commitment hereunder. Unless an earlier date is otherwise agreed upon
between the Borrower, the Administrative Agent, the Documentation Agent and the
terminating Lender, such Lender's Commitment shall terminate simultaneously with
the closing of such transaction and the Borrower shall repay at such time all of
such Lender's outstanding Loans, together with accrued interest thereon, any
accrued fees with respect to such Lender's Commitment, any costs, losses or
expenses incurred by such Lender in connection with such prepayment payable by
the Borrower pursuant to Section 3.4 and any other obligations of the Borrower
to such Lender hereunder. Any failure of the Borrower to deliver a Change in
Control Notice pursuant to this Section shall not affect the right of any Lender
to terminate its Commitment hereunder simultaneously with the closing of the
transaction causing the Change in Control nor the obligation of the Borrower to
repay at the time of such closing the amounts required in connection with such
termination.
2.19. Issuance of Letters of Credit. On the terms and subject to the
conditions set forth herein, the Administrative Agent shall, from time to time
from and including the date of this Agreement and prior to the Facility
Termination Date, issue its letters of credit (each a "Letter of Credit" and,
collectively, the "Letters of Credit") for the account of the Borrower, in an
amount (a) which when added to the aggregate amount of other Outstanding Letters
of Credit and unpaid L/C Drawings will not exceed $10,000,000, and (b) which
when added to the aggregate amount of Loans outstanding hereunder and the
aggregate amount of other Outstanding Letters of Credit and unpaid L/C Drawings
will not exceed the Aggregate Commitment. Each Letter of Credit shall be
requested by the Borrower at least one Business Day prior to the proposed
issuance date by delivery to the Administrative Agent of a duly executed Letter
of Credit Application, accompanied by all other documents, instruments and
agreements as the Administrative Agent may require (the "L/C Documents"). No
Letter of Credit shall have a stated expiration date (or provide for the
extension of such stated expiration date or the issuance of any replacement
therefor) later than the Facility Termination Date.
2.20. Purchase of Participation Interests. Upon the issuance of each
Letter of Credit, the Lenders shall be automatically deemed to have purchased an
undivided participation interest therein and in all rights and obligations
relating thereto ratably in proportion to the ratio that their respective
Commitments bear to the Aggregate Commitment.
2.21. Repayment of L/C Drawings. Any drawing under any Letter of Credit (a
"L/C Drawing") shall be payable in full by the Borrower: (1) prior to the
occurrence of a Default and acceleration of the Obligations, on the date the
Administrative Agent notifies the Borrower (which notice may be telephonic) of
such L/C Drawing if such notice is given prior to 1:00 p.m. (Salt Lake City
time), or on the next succeeding Business Day if given after 1:00 p.m. (Salt
Lake City time), or (2) following the occurrence of a Default and acceleration
of the Obligations, without demand upon or notice to the Borrower, on the date
of such L/C Drawing. Any L/C Drawing not paid on the date when due shall accrue
interest as provided in Section 2.11 above, from and including such date to but
not including the date paid in full. The Lenders hereby absolutely and
unconditionally (including, without limitation, following the occurrence of a
Default) agree to purchase and sell among themselves the dollar amount of any
L/C Drawing which is not paid on the date when due by the Borrower, so that each
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unrepaid L/C Drawing shall be held and participated in by the Lenders ratably in
proportion to the ratio that their respective Commitments bear to the Aggregate
Commitment.
2.22. Absolute Obligation to Repay. The Borrower's obligation to repay L/C
Drawings shall be absolute, irrevocable and unconditional under any and all
circumstances whatsoever and irrespective of any set-off, counterclaim or
defense to payment which the Borrower may have or have had, against any Lender
or any other Person, including, without limitation, any set-off, counterclaim or
defense based upon or arising out of: (1) any lack of validity or enforceability
of this Agreement or any of the other Loan Documents; (2) any amendment or
waiver of or any consent to departure from the terms of any Letter of Credit;
(3) the existence of any claim, setoff, defense or other right which the
Borrower or any other Person may have at any time against any beneficiary or any
transferee of any Letter of Credit (or any Person for whom any such beneficiary
or any such transferee may be acting); (4) any allegation that any demand,
statement or any other document presented under any Letter of Credit is forged,
fraudulent, invalid or insufficient in any respect, or that any statement
therein is untrue or inaccurate in any respect whatsoever or that variations in
punctuation, capitalization, spelling or format were contained in the drafts or
any statements presented in connection with any L/C Drawing; (5) any payment
made by the Administrative Agent under any Letter of Credit to any Person
purporting to be a trustee in bankruptcy, debtor-in-possession, assignee for the
benefit of creditors, liquidator, receiver or other representative of or
successor to any beneficiary or any transferee of any Letter of Credit,
including any arising in connection with any insolvency proceeding; or (6) any
other circumstance of happening whatsoever, whether or not similar to any of the
foregoing, including any other circumstance that might otherwise constitute a
defense available to, or a discharge of the Borrower. Nothing contained herein
shall constitute a waiver of any rights of the Borrower against the
Administrative Agent arising out of the gross negligence or willful misconduct
of the Administrative Agent in connection with any Letter of Credit issued
hereunder, it being expressly acknowledged and agreed by the Administrative
Agent that payment by the Administrative Agent under any Letter of Credit in an
amount in excess of that available for drawing thereunder or in excess of that
requested by the beneficiary in making a drawing thereunder shall constitute
"gross negligence" on the part of the Administrative Agent.
2.23. Uniform Customs and Practice. The Uniform Customs and Practice for
Documentary Credits as published by the International Chamber of Commerce most
recently at the time of issuance of any Letter of Credit shall (unless otherwise
expressly provided in such Letter of Credit) apply to such Letter of Credit.
2.24. Relationship to Letter of Credit Application. In the event of any
inconsistency between the terms and provisions of this Agreement and the terms
and provisions of the Letter of Credit Application, the terms and provisions of
this Agreement shall supersede and govern.
2.25. Letter of Credit Fee. The Borrower agrees to pay to the
Administrative Agent for the account of the Lenders, ratably in proportion to
the ratio that their respective Commitments bear to the Aggregate Commitment, a
letter of credit fee equal to one percent (1%) multiplied by the stated amount
of all Outstanding Letters of Credit, payable in arrears on each Payment Date
hereafter and on the Facility Termination Date.
2.26. Guaranties and Subordination Xxxxxxxxxx.Xx additional credit support
for the Obligations, the Borrower shall cause to be executed and delivered to
the Documentation Agent from each of the Guarantors a Guaranty and a
Subordination Agreement. The Borrower shall also cause to be executed and
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delivered to the Documentation Agent a Guaranty and a Subordination Agreement
from any other direct or indirect Subsidiary hereafter established or acquired
from time to time.
ARTICLE III
CHANGE IN CIRCUMSTANCES
-----------------------
3.1. Yield Protection. If any law or any governmental or
quasi-governmental rule, regulation, policy, guideline or directive (whether or
not having the force of law), or any interpretation thereof, or the compliance
of any Lender therewith,
(i) subjects any Lender or any applicable Lending Installation to
any tax, duty, charge or withholding on or from payments due
from the Borrower (excluding federal taxation of the overall
net income of any Lender or applicable Lending Installation),
or changes the basis of taxation of payments to any Lender in
respect of its Loans or other amounts due it hereunder, or
(ii) imposes or increases or deems applicable any reserve,
assessment, insurance charge, special deposit or similar
requirement against assets of, deposits with or for the
account of, or credit extended by, any Lender or any
applicable Lending Installation (other than reserves and
assessments taken into account in determining the interest
rate applicable to Fixed Rate Advances), or
(iii) imposes any other condition the result of which is to increase
the cost to any Lender or any applicable Lending Installation
of making, funding or maintaining loans or reduces any amount
receivable by any Lender or any applicable Lending
Installation in connection with loans, or requires any Lender
or any applicable Lending Installation to make any payment
calculated by reference to the amount of loans held or
interest received by it, by an amount deemed material by such
Lender,
then, within 15 days of demand by such Lender, the Borrower shall pay such
Lender that portion of such increased expense incurred or reduction in an amount
received which such Lender determines is attributable solely to making, funding
and maintaining its Loans and its Commitment. Notwithstanding anything to the
contrary set forth above in this Section, this Section shall not apply to
Floating Rate Loans.
3.2. Changes in Capital Adequacy Regulations. If a Lender determines the
amount of capital required or expected to be maintained by such Lender, any
Lending Installation of such Lender or any corporation controlling such Lender
is increased as a result of a Change, then, within 15 days of demand by such
Lender, the Borrower shall pay such Lender the amount necessary to compensate
for any shortfall in the rate of return on the portion of such increased capital
which such Lender determines is attributable to this Agreement, its Loans or its
obligation to make Loans hereunder (after taking into account such Lender's
policies as to capital adequacy). "Change" means (i) any change after the date
of this Agreement in the Risk-Based Capital Guidelines or (ii) any adoption of
or change in any other law, governmental or quasi-governmental rule, regulation,
policy, guideline, interpretation, or directive (whether or not having the force
of law) after the date of this Agreement which affects the amount of capital
required or expected to be maintained by any Lender or any Lending Installation
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or any corporation controlling any Lender. "Risk-Based Capital Guidelines" means
(i) the risk-based capital guidelines in effect in the United States on the date
of this Agreement, including transition rules, and (ii) the corresponding
capital regulations promulgated by regulatory authorities outside the United
States implementing the July 1988 report of the Basle Committee on Banking
Regulation and Supervisory Practices Entitled "International Convergence of
Capital Measurements and Capital Standards," including transition rules, and any
amendments to such regulations adopted prior to the date of this Agreement.
Notwithstanding anything to the contrary set forth above in this Section, this
Section shall not apply to Floating Rate Loans.
3.3. Availability of Types of Advances. If any Lender determines that
maintenance of any of its Fixed Rate Loans at a suitable Lending Installation
would violate any applicable law, rule, regulation, or directive, whether or not
having the force of law, or if the Required Lenders determine that (i) deposits
of a type and maturity appropriate to match fund Fixed Rate Advances are not
available or (ii) the interest rate applicable to a Type of Advance does not
accurately reflect the cost of making or maintaining such Advance, then the
Administrative Agent shall suspend the availability of the affected Type of
Advance and require any Fixed Rate Advances of the affected Type to be repaid.
3.4. Funding Indemnification. If any payment of a Fixed Rate Advance
occurs on a date which is not the last day of the applicable Interest Period,
whether because of acceleration, prepayment or otherwise, or a Fixed Rate
Advance is not made on the date specified by the Borrower for any reason other
than default by the Lenders, the Borrower will indemnify each Lender for any
loss or cost incurred by it resulting therefrom, including, without limitation,
any loss or cost in liquidating or employing deposits acquired to fund or
maintain the Fixed Rate Advance.
3.5. Lender Statements; Survival of Indemnity. To the extent reasonably
possible, each Lender shall designate an alternate Lending Installation with
respect to its Fixed Rate Loans to reduce any liability of the Borrower to such
Lender under Sections 3.1 and 3.2 or to avoid the unavailability of a Type of
Advance under Section 3.3, so long as such designation is not disadvantageous to
such Lender. Each Lender shall deliver a written statement of such Lender to the
Borrower (with a copy to the Administrative Agent) as to the amount due, if any,
under Section 3.1, 3.2 or 3.4. Such written statement shall set forth in
reasonable detail the calculations upon which such Lender determined such amount
and shall be final, conclusive and binding on the Borrower in the absence of
manifest error. Determination of amounts payable under such Sections in
connection with a Fixed Rate Loan shall be calculated as though each Lender
funded its Fixed Rate Loan through the purchase of a deposit of the type and
maturity corresponding to the deposit used as a reference in determining the
Fixed Rate applicable to such Loan, whether in fact that is the case or not.
Unless otherwise provided herein, the amount specified in the written statement
of any Lender shall be payable on demand after receipt by the Borrower of such
written statement. The obligations of the Borrower under Sections 3.1, 3.2 and
3.4 shall survive payment of the Obligations and termination of this Agreement.
ARTICLE IV
CONDITIONS PRECEDENT; WITHHOLDING TAX EXEMPTION
4.1. Initial Advance. The Lenders shall not be required to make the
initial Advance hereunder at any time prior to the date of this Agreement and
unless and until the Borrower has furnished to the Documentation Agent with
sufficient copies for the Lenders:
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(i) Duly executed originals of this Agreement.
(ii) Duly executed originals of each of the Guaranties.
(iii) Duly executed originals of each of the Subordination
Agreements.
(iv) Copies of the articles of incorporation of the Borrower,
together with all amendments, and a certificate of good
standing, both certified by the Secretary of State of the
State of Utah.
(v) Copies, certified by the Secretary or Assistant Secretary of
the Borrower, of its by-laws and of its Board of Directors'
resolutions (and resolutions of other bodies, if any are
deemed necessary by counsel for any Lender) authorizing the
execution of the Loan Documents.
(vi) An incumbency certificate, executed by the Secretary or
Assistant Secretary of the Borrower, which shall identify by
name and title and bear the signature of the officers of the
Borrower authorized to sign the Loan Documents and to make
borrowings hereunder, upon which certificate the
Administrative Agent, the Documentation Agent and the Lenders
shall be entitled to rely until informed of any change in
writing by the Borrower.
(vii) With respect to each of the Guarantors, an incumbency
certificate, executed by the Secretary or Assistant Secretary
of such Guarantor, which shall identify by name and title and
bear the signature of the officers of such Guarantor
authorized to sign the Guaranty to which it is party.
(viii) A certificate, signed by the chief financial officer of the
Borrower, stating that on the initial Borrowing Date no
Default or Unmatured Default has occurred and is continuing.
(ix) A written opinion of counsel to the Borrower and the
Guarantors, addressed to the Lenders in substantially the form
of Exhibit "B" hereto.
(x) Notes payable to the order of each of the Lenders.
(xi) Written money transfer instructions, in substantially the form
of Exhibit "E" hereto, addressed to the Administrative Agent
and signed by an Authorized Officer, together with such other
related money transfer authorizations as the Administrative
Agent may have reasonably requested.
(xii) Evidence satisfactory to the Administrative Agent and the
Documentation Agent that upon funding of the initial Advance
hereunder, all Indebtedness under the Existing Credit
Agreement shall have been paid in full.
(xiii) Information satisfactory to the Documentation Agent and the
Lenders regarding the Borrower's Year 2000 Program.
(xiv) Such other documents as any Lender or its counsel may have
reasonably requested.
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Promptly upon funding of the Initial Advance hereunder, the Documentation Agent
shall cause to be released any security interest in any collateral securing the
Indebtedness under the Existing Credit Agreement.
4.2. Each Advance. The Lenders shall not be required to make any Advance
(other than an Advance that, after giving effect thereto and to the application
of the proceeds thereof, does not increase the aggregate amount of outstanding
Advances), unless on the applicable Borrowing Date:
(i) There exists no Default or Unmatured Default.
(ii) The representations and warranties contained in Article V are
true and correct in all material respects as of such Borrowing
Date except to the extent any such representation or warranty
is stated to relate solely to an earlier date, in which case
such representation or warranty shall be true and correct on
and as of such earlier date.
(iii) All legal matters incident to the making of such Advance shall be
satisfactory to the Lenders and their counsel.
Each Borrowing Notice with respect to each such Advance shall constitute a
representation and warranty by the Borrower that the conditions contained in
Sections 4.2(i) and (ii) have been satisfied. Any Lender may, through the
Administrative Agent, require a duly completed compliance certificate in
substantially the form of Exhibit "C" hereto as a condition to making an
Advance.
4.3. Withholding Tax Exemption. At least five Business Days prior to the
first date on which interest or fees are payable hereunder for the account of
any Lender, each Lender that is not incorporated under the laws of the United
States of America, or a state thereof, agrees that it will deliver to each of
the Borrower, the Administrative Agent and the Documentation Agent two duly
completed copies of United States Internal Revenue Service Form 1001 or 4224,
certifying in either case that such Lender is entitled to receive payments under
this Agreement and the Notes without deduction or withholding of any United
States federal income taxes. Each Lender which so delivers a Form 1001 or 4224
further undertakes to deliver to each of the Borrower, the Administrative Agent
and the Documentation Agent two additional copies of such form (or a successor
form) on or before the date that such form expires (currently, three successive
calendar years for Form 1001 and one calendar year for Form 4224) or becomes
obsolete or after the occurrence of any event requiring a change in the most
recent forms so delivered by it, and such amendments thereto or extensions or
renewals thereof as may be reasonably requested by the Borrower, the
Administrative Agent or the Documentation Agent, in each case certifying that
such Lender is entitled to receive payments under this Agreement and the Notes
without deduction or withholding of any United States federal income taxes,
unless an event (including without limitation any change in treaty, law or
regulation) has occurred prior to the date on which any such delivery would
otherwise be required which renders all such forms inapplicable or which would
prevent such Lender from duly completing and delivering any such form with
respect to it and such Lender advises the Borrower, the Administrative Agent and
the Documentation Agent that it is not capable of receiving payments without any
deduction or withholding of United States federal income tax.
1a-222232
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ARTICLE V
REPRESENTATIONS AND WARRANTIES
------------------------------
The Borrower represents and warrants to the Lenders that:
5.1. Corporate Existence and Standing. Each of the Borrower and its
Subsidiaries is a corporation duly incorporated, validly existing and in good
standing under the laws of its jurisdiction of incorporation and has all
requisite authority to conduct its business in each jurisdiction where its
ownership of property or conduct of business requires such authority and where
failure to have such authority could have a Material Adverse Effect.
5.2. Authorization and Validity. Each of the Borrower and the Guarantors
has the corporate power and authority and legal right to execute and deliver the
Loan Documents to which it is party and to perform its obligations thereunder.
The execution and delivery by the Borrower and the Guarantors of the Loan
Documents and the performance of their respective obligations thereunder have
been duly authorized by proper corporate proceedings, the Loan Documents to
which the Borrower is party constitute legal, valid and binding obligations of
the Borrower enforceable against the Borrower in accordance with their terms,
and the Loan Documents to which each Guarantor is party constitute legal, valid
and binding obligations of such Guarantor enforceable against such Guarantor in
accordance with their terms, except as enforceability may be limited by
bankruptcy, insolvency or similar laws affecting the enforcement of creditors'
rights generally.
5.3. No Conflict; Government Consent. Neither the execution and delivery
by the Borrower or any Guarantor of the Loan Documents, nor the consummation of
the transactions therein contemplated, nor compliance with the provisions
thereof will violate any law, rule, regulation, order, writ, judgment,
injunction, decree or award binding on the Borrower or any of the Guarantors or
the Borrower's or any Guarantor's articles of incorporation or by-laws or the
provisions of any material indenture, instrument or agreement to which the
Borrower or any of the Guarantors is a party or is subject, or by which it, or
its Property, is bound, or conflict with or constitute a default thereunder, or
result in the creation or imposition of any Lien in, of or on the Property of
the Borrower or any Guarantor pursuant to the terms of any such indenture,
instrument or agreement. No order, consent, approval, license, authorization, or
validation of, or filing, recording or registration with, or exemption by, or
other action in respect of any governmental or public body or authority, or any
subdivision thereof, is required to authorize, or is required in connection with
the execution, delivery and performance of, or the legality, validity, binding
effect or enforceability of, any of the Loan Documents.
5.4. Financial Statements. The consolidated financial statements dated
December 28, 1997 of the Borrower and its Subsidiaries heretofore delivered to
the Lenders were prepared in accordance with generally accepted accounting
principles in effect on the date such statements were prepared and fairly
present the consolidated financial condition and operations of the Borrower and
its Subsidiaries at such date and the consolidated results of their operations
for the period then ended.
5.5. Material Adverse Change. Since December 28, 1997, there has been no
change in the business, Property, prospects, condition (financial or otherwise)
or results of operations of the Borrower and its Subsidiaries which is likely to
have a Material Adverse Effect.
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5.6. Taxes.The Borrower and its Subsidiaries have filed all United States
federal tax returns and all other tax returns which are required to be filed and
have paid all taxes due pursuant to said returns or pursuant to any assessment
received by the Borrower or any of its Subsidiaries, except such taxes, if any,
as are being contested in good faith and as to which adequate reserves have been
provided in accordance with Agreement Accounting Principles and as to which no
Lien exists. The United States income tax returns of the Borrower and its
Subsidiaries have been audited by the Internal Revenue Service through the
fiscal year ended December 31, 1993. No tax liens have been filed and no claims
are being asserted with respect to any such taxes. The charges, accruals and
reserves on the books of the Borrower and its Subsidiaries in respect of any
taxes or other governmental charges are adequate.
5.7. Litigation and Contingent Obligations. Except as set forth on
Schedule "3" hereto, there is no litigation, arbitration, governmental
investigation, proceeding or inquiry pending or, to the knowledge of any of
their officers, threatened against or affecting the Borrower or any of its
Subsidiaries which could have a Material Adverse Effect or which seeks to
prevent, enjoin or delay the making of the Loans or Advances. Other than any
liability incident to such litigation, arbitration or proceedings, the Borrower
has no material contingent obligations not provided for or disclosed in the
financial statements referred to in Section 5.4.
5.8. Subsidiaries. Schedule "1" hereto contains an accurate list of all
Subsidiaries of the Borrower as of the date of this Agreement, setting forth
their respective jurisdictions of incorporation and the percentage of their
respective capital stock owned by the Borrower or other Subsidiaries. All of the
issued and outstanding shares of capital stock of such Subsidiaries have been
duly authorized and issued and are fully paid and non-assessable.
5.9. ERISA. The Unfunded Liabilities of all Single Employer Plans do not
in the aggregate exceed $1,000,000. Each Plan complies in all material respects
with all applicable requirements of law and regulations, no Reportable Event has
occurred with respect to any Plan, neither the Borrower nor any other members of
the Controlled Group has withdrawn from any Plan or initiated steps to do so,
and no steps have been taken to reorganize or terminate any Plan.
5.l0. Accuracy of Information. No information, exhibit or report furnished
by the Borrower or any of its Subsidiaries to the Administrative Agent or to any
Lender in connection with the negotiation of, or compliance with, the Loan
Documents contained any material misstatement of fact or omitted to state a
material fact or any fact necessary to make the statements contained therein not
misleading.
5.11. Regulation U. Margin stock (as defined in Regulation U) constitutes
less than 25% of those assets of the Borrower and its Subsidiaries which are
subject to any limitation on sale, pledge, or other restriction hereunder.
5.12. Material Agreements. Neither the Borrower nor any Subsidiary is a
party to any agreement or instrument or subject to any charter or other
corporate restriction which is likely to have a Material Adverse Effect. Neither
the Borrower nor any Subsidiary is in default in the performance, observance or
fulfillment of any of the material obligations, covenants or conditions
contained in (i) any agreement to which it is a party, which default is likely
to have a Material Adverse Effect or (ii) any agreement or instrument evidencing
or governing Indebtedness.
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5.13. Compliance With Laws. The Borrower and its Subsidiaries have
complied with all applicable statutes, rules, regulations, orders and
restrictions of any domestic or foreign government or any instrumentality or
agency thereof, having jurisdiction over the conduct of their respective
businesses or the ownership of their respective Property if failure to comply
could reasonably be expected to have a Material Adverse Effect.
5.14. Ownership of Properties. Except as set forth on Schedule "2" hereto,
on the date of this Agreement, the Borrower and its Subsidiaries will have good
title, free of all Liens other than those permitted by Section 6.15, to all of
the Property and assets reflected in the financial statements as owned by it.
5.15. Plan Assets; Prohibited Transactions. The Borrower is not an entity
deemed to hold "plan assets" within the meaning of 29 C.F.R. ss. 2510.3-101 of
an employee benefit plan (as defined in Section 3(3) of ERISA) which is subject
to Title I of ERISA or any plan (within the meaning of Section 4975 of the
Code); and neither the execution of this Agreement and the making of Loans
hereunder do not give rise to a prohibited transaction within the meaning of
Section 406 of ERISA or Section 4975 of the Code.
5.16. Environmental Matters. In the ordinary course of its business, the
officers of the Borrower consider the effect of Environmental Laws on the
business of the Borrower and its Subsidiaries, in the course of which they
identify and evaluate potential risks and liabilities accruing to the Borrower
due to Environmental Laws. On the basis of this consideration, the Borrower has
reasonably concluded that it is in material compliance with all applicable
Environmental Laws in effect on the date of this representation and warranty.
Neither the Borrower nor any Subsidiary has received any notice to the effect
that its operations are not in material compliance with any of the requirements
of applicable Environmental Laws or are the subject of any federal or state
investigation evaluating whether any remedial action is needed to respond to a
release of any toxic or hazardous waste or substance into the environment, which
non-compliance or remedial action could have a Material Adverse Effect.
5.17. Investment Company Act. Neither the Borrower nor any Subsidiary
thereof is an "investment company" or a company "controlled" by an "investment
company", within the meaning of the Investment Company Act of 1940, as amended.
5.18. Public Utility Holding Company Act. Neither the Borrower nor any
Subsidiary is a "holding company" or a "subsidiary company" of a "holding
company", or an "affiliate" of a "holding company" or of a "subsidiary company"
of a "holding company", within the meaning of the Public Utility Holding Company
Act of 1935, as amended.
5.19. Year 2000 Program. The Borrower has made a full and complete
assessment of the Year 2000 Issues and has a realistic and achievable program
for remediating the Year 2000 Issues on a timely basis (the "Year 2000
Program"). Based on such assessment and on the Year 2000 Program the Borrower
does not reasonably anticipate that Year 2000 Issues will have a Material
Adverse Effect.
1a-222232
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ARTICLE VI
COVENANTS
---------
During the term of this Agreement, unless the Required Lenders shall
otherwise consent in writing:
6.1. Financial Reporting. The Borrower will maintain, for itself and each
Subsidiary, a system of accounting established and administered in accordance
with generally accepted accounting principles, and furnish to the Lenders:
(i) Within 90 days after the close of each of its fiscal years,
(A) an unqualified (except for qualifications relating to
changes in accounting principles or practices reflecting
changes in generally accepted principles of accounting and
required or approved by the Borrower's independent certified
public accountants) audit report certified by independent
certified public accountants, acceptable to the Required
Lenders, prepared in accordance with Agreement Accounting
Principles on a consolidated and consolidating basis
(consolidating statements need not be certified by such
accountants) for itself and the Subsidiaries, including
balance sheets as of the end of such period, related profit
and loss and reconciliation of surplus statements, and a
statement of cash flows, accompanied by any management letter
prepared by said accountants, and (B) consolidating unaudited
balance sheets as at the close of each such period and
consolidating profit and loss and reconciliation of surplus
statements and a statement of cash flows for such fiscal year,
all certified by its chief financial officer.
(ii) Within 45 days after the close of the first three quarterly
periods of each of its fiscal years, for itself and the
Subsidiaries, consolidated and consolidating unaudited balance
sheets as at the close of each such period and consolidated
and consolidating profit and loss and reconciliation of
surplus statements and a statement of cash flows for the
period from the beginning of such fiscal year to the end of
such quarter, all certified by its chief financial officer.
(iii) Together with the financial statements required under Sections
6.1(i) and (ii), a compliance certificate in substantially the
form of Exhibit "C" hereto signed by an Authorized Officer
showing the calculations necessary to determine compliance
with this Agreement and stating that no Default or Unmatured
Default exists, or if any Default or Unmatured Default exists,
stating the nature and status thereof.
(iv) Within 270 days after the close of each fiscal year, a
statement of the Unfunded Liabilities of each Single Employer
Plan, certified as correct by an actuary enrolled under ERISA.
(v) As soon as possible and in any event within 10 days after the
Borrower knows that any Reportable Event has occurred with
respect to any Plan, a statement, signed by the chief
financial officer of the Borrower, describing said Reportable
Event and the action which the Borrower proposes to take with
respect thereto.
(vi) As soon as possible and in any event within 10 days after
receipt by the Borrower, a copy of (a) any notice or claim to
the effect that the Borrower or any of its Subsidiaries is or
may be liable to any Person as a result of the release by the
Borrower, any of its Subsidiaries, or any other Person of any
toxic or hazardous waste or substance into the environment,
and (b) any notice alleging any violation of any federal,
state or local environmental, health or safety law or
1a-222232
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regulation by the Borrower or any of its Subsidiaries, which,
in either case, could reasonably be expected to have a
Material Adverse Effect.
(vii) Promptly upon the furnishing thereof to the shareholders of
the Borrower, copies of all financial statements, reports and
proxy statements so furnished.
(viii) Promptly upon the filing thereof, copies of all registration
statements and annual, quarterly, monthly or other regular
reports which the Borrower or any of its Subsidiaries files
with the Securities and Exchange Commission.
(ix) Such other information (including non-financial information)
as the Documentation Agent, the Administrative Agent or any
Lender may from time to time reasonably request.
6.2. Use of Proceeds. The Borrower will, and will cause each Subsidiary
to, use the proceeds of the Advances to repay the obligations under the Existing
Credit Agreement, to support general corporate purposes and friendly
Acquisitions, and to repay outstanding Advances. The Borrower will not, nor will
it permit any Subsidiary to, use any of the proceeds of the Advances to purchase
or carry any "margin stock" (as defined in Regulation U).
6.3. Notice of Default. The Borrower will, and will cause each Subsidiary
to, give prompt notice in writing to the Lenders of the occurrence of any
Default or Unmatured Default and of any other development, financial or
otherwise (including, without limitation, developments with respect to Year 2000
Issues), which could have a Material Adverse Effect.
6.4. Conduct of Business. The Borrower will, and will cause each
Subsidiary to, carry on and conduct its business in substantially the same
manner and in substantially the same fields of enterprise as it is presently
conducted or in related business lines and to do all things necessary to remain
duly incorporated, validly existing and in good standing as a domestic
corporation in its jurisdiction of incorporation and maintain all requisite
authority to conduct its business in each jurisdiction in which its business is
conducted.
6.5. Taxes. The Borrower will, and will cause each Subsidiary to, timely
file complete and correct United States federal and applicable foreign, state
and local tax returns required by law and pay when due all taxes, assessments
and governmental charges and levies upon it or its income, profits or Property,
except those which are being contested in good faith by appropriate proceedings
and with respect to which adequate reserves have been set aside in accordance
with Agreement Accounting Principles.
6.6. Insurance. The Borrower will, and will cause each Subsidiary to,
maintain with financially sound and reputable insurance companies insurance on
all their Property in such amounts and covering such risks as is consistent with
sound business practice, and the Borrower will furnish to any Lender upon
request full information as to the insurance carried.
6.7. Compliance with Laws. The Borrower will, and will cause each
Subsidiary to, comply with all laws, rules, regulations, orders, writs,
judgments, injunctions, decrees or awards to which it may be subject, except to
the extent that such noncompliance could not reasonably be expected to have a
Material Adverse Effect.
1a-222232
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6.8. Maintenance of Properties. The Borrower will, and will cause each
Subsidiary to, do all things necessary to maintain, preserve, protect and keep
its Property in good repair, working order and condition, and make all necessary
and proper repairs, renewals and replacements so that its business carried on in
connection therewith may be properly conducted at all times.
6.9. Inspection. The Borrower will, and will cause each Subsidiary to,
permit the Administrative Agent, the Documentation Agent and the Lenders, by
their respective representatives and agents, to inspect any of the Property,
corporate books and financial records of the Borrower and each Subsidiary, to
examine and make copies of the books of accounts and other financial records of
the Borrower and each Subsidiary, and to discuss the affairs, finances and
accounts of the Borrower and each Subsidiary with, and to be advised as to the
same by, their respective officers at such reasonable times and intervals as the
Administrative Agent, the Documentation Agent or any Lender may designate.
6.10. Dividends. The Borrower will not, nor will it permit any Subsidiary
to, declare or pay any dividends or make any distributions on its capital stock
(other than dividends payable in its own capital stock and dividends on
preferred stock of the Borrower outstanding on the date of this Agreement),
except that any Subsidiary may declare and pay dividends to, or make
distributions to, or make redemptions from, the Borrower or a Wholly-Owned
Subsidiary.
6.11. Indebtedness. The Borrower will not, nor will it permit any
Subsidiary to, create, incur or suffer to exist any Indebtedness, except:
(i) The Loans.
(ii) Indebtedness existing on the date hereof and described in
Schedule "2" hereto.
(iii) Indebtedness arising under Rate Hedging Agreements related to
the Loans.
(iv) Subject to the prior review by the Documentation Agent of (A)
the relevant documentation in connection therewith and (B)
evidence of the Borrower's compliance with the financial
covenants under this Agreement on a proforma basis upon the
incurrence thereof, any other Indebtedness with a final
maturity date not earlier than five years from its date of
issuance and with financial covenants that are not more
restrictive than those under this Agreement.
6.12. Merger. The Borrower will not, nor will it permit any Subsidiary to,
merge or consolidate with or into any other Person, except: (1) any merger of a
Subsidiary into the Borrower or a Wholly-Owned Subsidiary, and (2) any
consolidation or merger in which the Borrower is the surviving entity and the
shareholders of the Borrower prior to such consolidation or merger will control
a majority of the Borrower's voting stock upon the closing of such consolidation
or merger.
6.13. Sale of Assets. The Borrower will not, nor will it permit any
Subsidiary to, lease, sell or otherwise dispose of its Property, to any other
Person, except:
(i) Sales of inventory in the ordinary course of business.
1a-222232
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(ii) Leases, sales or other dispositions of its Property that,
together with all other Property of the Borrower and its
Subsidiaries previously leased, sold or disposed of (other
than inventory in the ordinary course of business) as
permitted by this Section during the twelve-month period
ending with the month in which any such lease, sale or other
disposition occurs, do not constitute a Substantial Portion of
the Property of the Borrower and its Subsidiaries.
6.14. Investments and Acquisitions. The Borrower will not, nor will it
permit any Subsidiary to, make or suffer to exist any Investments (including,
without limitation, loans and advances to, and other Investments in,
Subsidiaries), or commitments therefor, or to create any Subsidiary or to become
or remain a partner in any partnership or joint venture, or to make any
Acquisition of any Person, except:
(i) Short-term obligations of, or fully guaranteed by, the United
States of America.
(ii) Commercial paper rated A-l or better by Standard and Poor's
Ratings Group, a division of McGraw Hill, Inc., or P-l or
better by Xxxxx'x Investors Service, Inc.
(iii) Municipal bonds rated AA or better, and preferred stock
rated A or better, by Standard and Poor's Ratings Group.
(iv) Demand deposit accounts maintained in the ordinary course of
business.
(v) Certificates of deposit issued by and time deposits with
commercial banks (whether domestic or foreign) having capital
and surplus in excess of $100,000,000.
(vi) Existing Investments in Subsidiaries and other Investments in
existence on the date hereof and described in Schedule "1"
hereto.
(vii) Investments arising in the ordinary course of business.
(viii) Friendly Acquisitions involving total expenditures not to
exceed (A) 20% of the Borrower's consolidated Net Worth in any
one transaction or series of transactions related to the same
entity; or (B) in the aggregate for any calendar year, 50% of
the Borrower's consolidated Net Worth; provided, however, that
with the prior written consent of the Lenders, the Borrower
may make friendly Acquisitions involving total expenditures in
excess of the above limits.
(ix) Investments in connection with non-qualified deferred
compensation programs for employees of the Borrower where the
Investments are directed by such employees.
6.15. Liens. The Borrower will not, nor will it permit any Subsidiary to,
create, incur, or suffer to exist any Lien in, of or on the Property of the
Borrower or any of its Subsidiaries, except:
(i) Liens for taxes, assessments or governmental charges or levies
on its Property if the same shall not at the time be
delinquent or thereafter can be paid without penalty, or are
being contested in good faith and by appropriate proceedings
1a-222232
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and for which adequate reserves in accordance with generally
accepted principles of accounting shall have been set aside on
its books.
(ii) Liens imposed by law, such as carriers', warehousemen's and
mechanics' liens and other similar liens arising in the
ordinary course of business which secure payment of
obligations not more than 60 days past due or which are being
contested in good faith by appropriate proceedings and for
which adequate reserves shall have been set aside on its
books.
(iii) Landlord's liens (whether imposed by law or by contract) on
personal property located in leased premises arising in the
ordinary course of business which secure payment of
obligations not more than 60 days past due or which are being
contested in good faith by appropriate proceedings and for
which adequate reserves shall have been set aside on its
books.
(iv) Liens arising out of pledges or deposits under worker's
compensation laws, unemployment insurance, old age pensions,
or other social security or retirement benefits, or similar
legislation.
(v) Utility easements, building restrictions and such other
encumbrances or charges against real property as are of a
nature generally existing with respect to properties of a
similar character and which do not in any material way affect
the marketability of the same or interfere with the use
thereof in the business of the Borrower or the Subsidiaries.
(vi) Liens existing on the date hereof and described in Schedule
"2" hereto.
6.16. Total Indebtedness / Total Capital Ratio. The Borrower will not
permit the ratio of the Total Indebtedness to the Total Capital of the Borrower
and its Subsidiaries on a consolidated basis to exceed 0.45:1.00, all determined
as of the last day of each fiscal quarter for the 12-month period ending on such
date.
6.17. Affiliates. The Borrower will not, and will not permit any
Subsidiary to, enter into any transaction (including, without limitation, the
purchase or sale of any Property or service) with, or make any payment or
transfer to, any Affiliate except in the ordinary course of business and
pursuant to the reasonable requirements of the Borrower's or such Subsidiary's
business and upon fair and reasonable terms no less favorable to the Borrower or
such Subsidiary than the Borrower or such Subsidiary would obtain in a
comparable arms-length transaction.
6.18. Net Worth The Borrower will not permit the Net Worth of the Borrower
and its consolidated Subsidiaries to be less than the sum of: (i) $83,500,000,
plus (ii) fifty percent (50%) of net income of the Borrower and its consolidated
Subsidiaries (if positive) earned at any time after December 31, 1997,
determined in accordance with Agreement Accounting Principles, plus (iii)
seventy-five percent (75%) of the net proceeds of any new equity issuance of the
Borrower and its consolidated Subsidiaries occurring at any time after the date
of this Agreement.
1a-222232
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6.19. Total Indebtedness / Adjusted EBITDA Ratio The Borrower will not
permit the Total Indebtedness / Adjusted EBITDA Ratio of the Borrower and its
consolidated Subsidiaries, determined as of the last day of each fiscal quarter
for the 12-month period ending on such date, to exceed 3.0:1.0.
6.20. Interest Coverage Ratio The Borrower will not permit the Interest
Coverage Ratio of the Borrower and its consolidated Subsidiaries, determined as
of the last day of each fiscal quarter for the 12-month period ending on such
date, to be less than 3.0:1.0.
6.21. Year 2000 Program. The Borrower will take and will cause each of its
Subsidiaries to take all such actions as are reasonably necessary to
successfully implement the Year 2000 Program and to assure that Year 2000 Issues
will not have a Material Adverse Effect. At the request of the Documentation
Agent or any Lender, the Borrower will provide a description of the Year 2000
Program, together with any updates or progress reports with respect thereto.
ARTICLE VII
DEFAULTS
--------
The occurrence of any one or more of the following events shall constitute
a Default:
7.1. Any representation or warranty made or deemed made by or on behalf
of the Borrower or any of its Subsidiaries to the Lenders, the Documentation
Agent or the Administrative Agent under or in connection with this Agreement,
any Loan, or any certificate or information delivered in connection with this
Agreement or any other Loan Document shall be materially false on the date as of
which made.
7.2. Nonpayment of principal of any Note when due, or nonpayment of
interest upon any Note or of any commitment fee or other obligations under any
of the Loan Documents within five days after the same becomes due.
7.3. The breach by the Borrower of any of the terms or provisions of
Article VI.
7.4. The breach by the Borrower (other than a breach which constitutes a
Default under Section 7.1, 7.2 or 7.3) of any of the terms or provisions of this
Agreement which is not remedied within thirty days after written notice from the
Administrative Agent, the Documentation Agent or any Lender.
7.5. Failure of the Borrower or any Guarantor to pay when due any
Indebtedness aggregating in excess of $1,000,000 ("Material Indebtedness"); or
the default by the Borrower or any Guarantor in the performance of any term,
provision or condition contained in any agreement under which any such Material
Indebtedness was created or is governed, or any other event shall occur or
condition exist, the effect of which is to cause, or to permit the holder or
holders of such Material Indebtedness to cause, such Material Indebtedness to
become due prior to its stated maturity; or any Material Indebtedness of the
Borrower or any Guarantor shall be declared to be due and payable or required to
be prepaid or repurchased (other than by a regularly scheduled payment) prior to
the stated maturity thereof; or the Borrower or any Guarantor shall not pay, or
admit in writing its inability to pay, its debts generally as they become due.
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7.6. The Borrower or any Guarantor shall (i) have an order for relief
entered with respect to it under the Federal bankruptcy laws as now or hereafter
in effect, (ii) make an assignment for the benefit of creditors, (iii) apply
for, seek, consent to, or acquiesce in, the appointment of a receiver,
custodian, trustee, examiner, liquidator or similar official for it or any
Substantial Portion of its Property, (iv) institute any proceeding seeking an
order for relief under the Federal bankruptcy laws as now or hereafter in effect
or seeking to adjudicate it a bankrupt or insolvent, or seeking dissolution,
winding up, liquidation, reorganization, arrangement, adjustment or composition
of it or its debts under any law relating to bankruptcy, insolvency or
reorganization or relief of debtors or fail to file an answer or other pleading
denying the material allegations of any such proceeding filed against it, (v)
take any corporate action to authorize or effect any of the foregoing actions
set forth in this Section 7.6 or (vi) fail to contest in good faith any
appointment or proceeding described in Section 7.7.
7.7. Without the application, approval or consent of the Borrower or any
Guarantor, a receiver, trustee, examiner, liquidator or similar official shall
be appointed for the Borrower or any Guarantor or any Substantial Portion of its
Property, or a proceeding described in Section 7.6(iv) shall be instituted
against the Borrower or any Guarantor and such appointment continues
undischarged or such proceeding continues undismissed or unstayed for a period
of 30 consecutive days.
7.8. Any court, government or governmental agency shall condemn, seize or
otherwise appropriate, or take custody or control of (each a "Condemnation"),
all or any portion of the Property of the Borrower or any Guarantor which, when
taken together with all other Property of the Borrower or any Guarantor so
condemned, seized, appropriated, or taken custody or control of, during the
twelve-month period ending with the month in which any such Condemnation occurs,
constitutes a Substantial Portion.
7.9. The Borrower or any of its Subsidiaries shall fail within 30 days to
pay, bond or otherwise discharge any judgment or order for the payment of money
(to the extent not covered by insurance) in excess of $1,000,000, which is not
stayed on appeal or otherwise being appropriately contested in good faith.
7.10. The Unfunded Liabilities of all Single Employer Plans shall exceed
in the aggregate $1,000,000 or any Reportable Event shall occur in connection
with any Plan.
7.11. The Borrower or any of its Subsidiaries shall be the subject of any
proceeding or investigation pertaining to the release by the Borrower or any of
its Subsidiaries, or any other Person of any toxic or hazardous waste or
substance into the environment, or any violation of any federal, state or local
environmental, health or safety law or regulation, which, in either case, could
be reasonably expected to have a Material Adverse Effect.
7.12. The occurrence of any "default", as defined in any Loan Document
(other than this Agreement or the Notes) or the breach of any of the terms or
provisions of any Loan Document (other than this Agreement or the Notes), which
default or breach continues beyond any period of grace therein provided.
7.13. Nonpayment by the Borrower of any Rate Hedging Obligation when due
or the breach by the Borrower of any term, provision or condition contained in
any Rate Hedging Agreement.
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7.14. Any Guaranty shall fail to remain in full force or effect (and such
failure could reasonably be expected to have a Material Adverse Effect) or any
action shall be taken to discontinue or to assert the invalidity or
unenforceability of any Guaranty, or any Guarantor shall fail to comply with any
of the terms or provisions of any Guaranty to which it is a party (and such
failure could reasonably be expected to have a Material Adverse Effect), or any
Guarantor denies that it has any further liability under any Guaranty to which
it is a party, or gives notice to such effect.
ARTICLE VIII
ACCELERATION, WAIVERS, AMENDMENTS AND REMEDIES
----------------------------------------------
8.1. Acceleration. If any Default described in Section 7.6 or 7.7 occurs
with respect to the Borrower, the obligations of the Lenders to make Loans
hereunder and the Administrative Agent's obligation to issue Letters of Credit
hereunder shall automatically terminate and the Obligations shall immediately
become due and payable without any election or action on the part of the
Administrative Agent, the Documentation Agent or any Lender. If any other
Default occurs, the Required Lenders (or the Administrative Agent with the
consent of the Required Lenders) may terminate or suspend the obligations of the
Lenders to make Loans hereunder (and the Administrative Agent may in its sole
discretion terminate or suspend its obligation to issue Letters of Credit
hereunder), or declare the Obligations to be due and payable, or both, whereupon
the Obligations shall become immediately due and payable, without presentment,
demand, protest or notice of any kind, all of which the Borrower hereby
expressly waives. Any amounts paid by the Borrower to the Administrative Agent
on account of Outstanding Letters of Credit shall be held by the Administrative
Agent as cash collateral for the obligations of the Borrower with respect to
unpaid L/C Drawings relating thereto, and the Borrower hereby grants to the
Administrative Agent a first perfected security interest in said cash and
authorizes the Administrative Agent to apply such cash on account of future L/C
Drawings as such become payable by the Borrower.
If, within five (5) days after acceleration of the maturity of the
Obligations or termination of the obligations of the Lenders to make Loans
hereunder as a result of any Default (other than any Default as described in
Section 7.6 or 7.7 with respect to the Borrower) and before any judgment or
decree for the payment of the Obligations due shall have been obtained or
entered, the Required Lenders (in their sole discretion) shall so direct, the
Administrative Agent shall, by notice to the Borrower, rescind and annul such
acceleration and/or termination.
8.2. Amendments. Subject to the provisions of this Article VIII, the
Required Lenders (or the Documentation Agent with the consent in writing of the
Required Lenders) and the Borrower may enter into agreements supplemental hereto
for the purpose of adding or modifying any provisions to the Loan Documents or
changing in any manner the rights of the Lenders or the Borrower hereunder or
waiving any Default hereunder; provided, however, that no such supplemental
agreement shall, without the consent of each Lender affected thereby:
(i) Extend the maturity of any Loan or Note or forgive all or any
portion of the principal amount thereof, or reduce the rate or
extend the time of payment of interest or fees thereon.
(ii) Modify the definition of Required Lenders.
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(iii) Reduce the amount or extend the payment date for, the
mandatory payments required under Section 2.2, or increase or
decrease the amount of the Commitment of any Lender hereunder
(except for a ratable decrease in the Commitments of all
Lenders), or permit the Borrower to assign its rights under
this Agreement.
(iv) Amend this Section 8.2.
(v) Release any Guarantor of any Advance.
No amendment of any provision of this Agreement relating to the Administrative
Agent or the Documentation Agent shall be effective without the written consent
of the Administrative Agent or the Documentation Agent, as applicable. The
Documentation Agent may waive payment of the fee required under Section 12.3.2
without obtaining the consent of any other party to this Agreement.
8.3. Preservation of Rights. No delay or omission of the Lenders, the
Administrative Agent or the Documentation Agent to exercise any right under the
Loan Documents shall impair such right or be construed to be a waiver of any
Default or an acquiescence therein, and the making of a Loan notwithstanding the
existence of a Default or the inability of the Borrower to satisfy the
conditions precedent to such Loan shall not constitute any waiver or
acquiescence. Any single or partial exercise of any such right shall not
preclude other or further exercise thereof or the exercise of any other right,
and no waiver, amendment or other variation of the terms, conditions or
provisions of the Loan Documents whatsoever shall be valid unless in writing
signed by the Lenders required pursuant to Section 8.2, and then only to the
extent in such writing specifically set forth. All remedies contained in the
Loan Documents or by law afforded shall be cumulative and all shall be available
to the Administrative Agent, the Documentation Agent and the Lenders until the
Obligations have been paid in full.
ARTICLE IX
GENERAL PROVISIONS
------------------
9.1. Survival of Representations. All representations and warranties of
the Borrower contained in this Agreement shall survive delivery of the Notes and
the making of the Loans herein contemplated.
9.2. Governmental Regulation. Anything contained in this Agreement to the
contrary notwithstanding, no Lender shall be obligated to extend credit to the
Borrower in violation of any limitation or prohibition provided by any
applicable statute or regulation.
9.3. Taxes. Any taxes (excluding federal income taxes on the overall net
income of any Lender) or other similar assessments or charges made by any
governmental or revenue authority in respect of the Loan Documents shall be paid
by the Borrower, together with interest and penalties, if any.
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9.4. Headings. Section headings in the Loan Documents are for convenience
of reference only, and shall not govern the interpretation of any of the
provisions of the Loan Documents.
9.5. Entire Agreement. The Loan Documents embody the entire agreement and
understanding among the Borrower, the Administrative Agent, the Documentation
Agent and the Lenders and supersede all prior agreements and understandings
among the Borrower, the Administrative Agent, the Documentation Agent and the
Lenders relating to the subject matter thereof.
9.6. Several Obligations; Benefits of this Agreement. The respective
obligations of the Lenders hereunder are several and not joint and no Lender
shall be the partner or agent of any other (except to the extent to which the
Administrative Agent or the Documentation Agent is authorized to act as such).
The failure of any Lender to perform any of its obligations hereunder shall not
relieve any other Lender from any of its obligations hereunder. This Agreement
shall not be construed so as to confer any right or benefit upon any Person
other than the parties to this Agreement and their respective successors and
assigns.
9.7. Expenses; Indemnification. The Borrower shall reimburse the
Documentation Agent for any costs, internal charges and reasonable out-of-pocket
expenses (including attorneys' fees and time charges of attorneys for the
Documentation Agent, which attorneys may be employees of the Documentation
Agent) paid or incurred by the Documentation Agent in connection with the
preparation, negotiation, execution, delivery, review, amendment, modification,
and administration of the Loan Documents. The Borrower also agrees to reimburse
the Administrative Agent, the Documentation Agent and the Lenders for any costs,
internal charges and reasonable out-of-pocket expenses (including attorneys'
fees and time charges of attorneys for the Administrative Agent, the
Documentation Agent and the Lenders, which attorneys may be employees of the
Administrative Agent, the Documentation Agent or the Lenders) paid or incurred
by the Administrative Agent, the Documentation Agent or any Lender in connection
with the collection and enforcement of the Loan Documents. The Borrower further
agrees to indemnify the Administrative Agent, the Documentation Agent and each
Lender, its directors, officers and employees against all losses, claims,
damages, penalties, judgments, liabilities and expenses (including, without
limitation, all expenses of litigation or preparation therefor whether or not
the Administrative Agent, the Documentation Agent or any Lender is a party
thereto) which any of them may pay or incur arising out of or relating to this
Agreement, the other Loan Documents, the transactions contemplated hereby or the
direct or indirect application or proposed application of the proceeds of any
Loan hereunder except to the extent that they are determined by a court of
competent jurisdiction to have resulted from the gross negligence or willful
misconduct of the party seeking indemnification. The obligations of the Borrower
under this Section shall survive the termination of this Agreement.
9.8. Numbers of Documents. All statements, notices, closing documents,
and requests hereunder shall be furnished to the Administrative Agent and
Documentation Agent with sufficient counterparts so that the Administrative
Agent or the Documentation Agent may furnish one to each of the Lenders.
9.9. Accounting. Except as provided to the contrary herein, all
accounting terms used herein shall be interpreted and all accounting
determinations hereunder shall be made in accordance with Agreement Accounting
Principles, except that any calculation or determination which is to be made on
a consolidated basis shall be made for the Borrower and all its Subsidiaries,
including those Subsidiaries, if any, which are unconsolidated on the Borrower's
audited financial statements.
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9.10. Severability of Provisions. Any provision in any Loan Document that
is held to be inoperative, unenforceable, or invalid in any jurisdiction shall,
as to that jurisdiction, be inoperative, unenforceable, or invalid without
affecting the remaining provisions in that jurisdiction or the operation,
enforceability, or validity of that provision in any other jurisdiction, and to
this end the provisions of all Loan Documents are declared to be severable.
9.11. Nonliability of Lenders.The relationship between the Borrower on the
one hand and the Lenders, the Documentation Agent and the Administrative Agent
on the other hand shall be solely that of borrower and lender. Neither the
Administrative Agent, the Documentation Agent nor any Lender shall have any
fiduciary responsibilities to the Borrower. Neither the Administrative Agent,
the Documentation Agent nor any Lender undertakes any responsibility to the
Borrower to review or inform the Borrower of any matter in connection with any
phase of the Borrower's business or operations. The Borrower agrees that neither
the Administrative Agent, the Documentation Agent nor any Lender shall have
liability to the Borrower (whether sounding in tort, contract or otherwise) for
losses suffered by the Borrower in connection with, arising out of, or in any
way related to, the transactions contemplated and the relationship established
by the Loan Documents, or any act, omission or event occurring in connection
therewith, unless it is determined by a court of competent jurisdiction in a
final and non-appealable order that such losses resulted from the gross
negligence or willful misconduct of the party from which recovery is sought.
Neither the Administrative Agent, the Documentation Agent nor any Lender shall
have any liability with respect to, and the Borrower hereby waives, releases and
agrees not to xxx for, any special, indirect or consequential damages suffered
by the Borrower in connection with, arising out of, or in any way related to the
Loan Documents or the transactions contemplated thereby.
9.12. Confidentiality. Each Lender agrees to hold any confidential
information which it may receive from the Borrower pursuant to this Agreement in
confidence, except for disclosure (i) to its Affiliates and to other Lenders and
their respective Affiliates, (ii) to legal counsel, accountants, and other
professional advisors to that Lender or to a Transferee, (iii) to regulatory
officials, (iv) to any Person as requested pursuant to or as required by law,
regulation, or legal process, (v) to any Person in connection with any legal
proceeding to which that Lender is a party, and (vi) permitted by Section 12.4.
9.13. Nonreliance. Each Lender hereby represents that it is not relying on
or looking to any margin stock (as defined in Regulation U of the Board of
Governors of the Federal Reserve System) for the repayment of the Loans provided
for herein.
ARTICLE X
THE ADMINISTRATIVE AGENT AND THE DOCUMENTATION AGENT
----------------------------------------------------
10.1. Appointment; Nature of Relationship.First Chicago and First Security
are hereby appointed by the Lenders as the Documentation Agent and the
Administrative Agent respectively hereunder and under each other Loan Document,
and each of the Lenders irrevocably authorizes the Documentation Agent and the
Administrative Agent to act as the contractual representative of such Lender
with the rights and duties expressly set forth herein and in the other Loan
Documents. Each of the Documentation Agent and the Administrative Agent agrees
to act as such contractual representative upon the express conditions contained
in this Article X. Notwithstanding the use of the defined terms "Documentation
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Agent" and "Administrative Agent," it is expressly understood and agreed that
the Documentation Agent and the Administrative Agent shall not have any
fiduciary responsibilities to any Lender by reason of this Agreement or any
other Loan Document and that each of the Documentation Agent and the
Administrative Agent is merely acting as the representative of the Lenders with
only those duties as are expressly set forth in this Agreement and the other
Loan Documents. In its capacity as the Lenders' contractual representative, each
of the Documentation Agent and the Administrative Agent (i) does not hereby
assume any fiduciary duties to any of the Lenders, (ii) is a "representative" of
the Lenders within the meaning of Section 9-105 of the Uniform Commercial Code
and (iii) is acting as an independent contractor, the rights and duties of which
are limited to those expressly set forth in this Agreement and the other Loan
Documents. Each of the Lenders hereby agrees to assert no claim against the
Documentation Agent or the Administrative Agent on any agency theory or any
other theory of liability for breach of fiduciary duty, all of which claims each
Lender hereby waives.
10.2. Powers. Each of the Documentation Agent and the Administrative Agent
shall have and may exercise such powers under the Loan Documents as are
specifically delegated to it by the terms of each thereof, together with such
powers as are reasonably incidental thereto. Neither the Documentation Agent nor
the Administrative Agent shall have any implied duties to the Lenders, or any
obligation to the Lenders to take any action thereunder except any action
specifically provided by the Loan Documents to be taken by it.
10.3. General Immunity. Neither the Administrative Agent nor the
Documentation Agent nor any of their respective directors, officers, agents or
employees shall be liable to the Borrower, the Lenders or any Lender for (i) any
action taken or omitted to be taken by it or them hereunder or under any other
Loan Document or in connection herewith or therewith except for its or their own
gross negligence or willful misconduct; or (ii) any determination by it or them
that compliance with any law or any governmental or quasi-governmental rule,
regulation, order, policy, guideline or directive (whether or not having the
force of law) requires the Advances and Commitments hereunder to be classified
as being part of a "highly leveraged transaction".
10.4. No Responsibility for Loans, Recitals, etc. Neither the
Administrative Agent nor the Documentation Agent nor any of their respective
directors, officers, agents or employees shall be responsible for or have any
duty to ascertain, inquire into, or verify (i) any statement, warranty or
representation made in connection with any Loan Document or any borrowing
hereunder; (ii) the performance or observance of any of the covenants or
agreements of any obligor under any Loan Document, including, without
limitation, any agreement by an obligor to furnish information directly to each
Lender; (iii) the satisfaction of any condition specified in Article IV, except
receipt of items required to be delivered to the Documentation Agent; (iv) the
validity, enforceability, effectiveness, sufficiency or genuineness of any Loan
Document or any other instrument or writing furnished in connection therewith;
or (v) the value, sufficiency, creation, perfection or priority of any interest
in any collateral security. Neither the Documentation Agent nor the
Administrative Agent shall have any duty to disclose to the Lenders information
that is not required to be furnished by the Borrower to it at such time, but is
voluntarily furnished by the Borrower to it (either in its capacity as the
Documentation Agent or the Administrative Agent, as applicable, or in its
individual capacity).
10.5. Action on Instructions of Lenders. Each of the Documentation Agent
and the Administrative Agent shall in all cases be fully protected in acting, or
in refraining from acting, hereunder and under any other Loan Document in
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accordance with written instructions signed by the Required Lenders, and such
instructions and any action taken or failure to act pursuant thereto shall be
binding on all of the Lenders and on all holders of Notes. The Lenders hereby
acknowledge that neither the Documentation Agent nor the Administrative Agent
shall be under any duty to take any discretionary action permitted to be taken
by it pursuant to the provisions of this Agreement or any other Loan Document
unless it shall be requested in writing to do so by the Required Lenders. Each
of the Documentation Agent and the Administrative Agent shall be fully justified
in failing or refusing to take any action hereunder and under any other Loan
Document unless it shall first be indemnified to its satisfaction by the Lenders
pro rata against any and all liability, cost and expense that it may incur by
reason of taking or continuing to take any such action.
10.6. Employment of Agents and Counsel. Each of the Documentation Agent
and the Administrative Agent may execute any of its duties as the Documentation
Agent or the Administrative Agent (as applicable) hereunder and under any other
Loan Document by or through employees, agents, and attorneys-in-fact and shall
not be answerable to the Lenders, except as to money or securities received by
it or its authorized agents, for the default or misconduct of any such agents or
attorneys-in-fact selected by it with reasonable care. Each of the Documentation
Agent and the Administrative Agent shall be entitled to advice of counsel
concerning all matters pertaining to the agency hereby created and its duties
hereunder and under any other Loan Document.
10.7. Reliance on Documents; Counsel. Each of the Documentation Agent and
the Administrative Agent shall be entitled to rely upon any Note, notice,
consent, certificate, affidavit, letter, telegram, statement, paper or document
believed by it to be genuine and correct and to have been signed or sent by the
proper person or persons, and, in respect to legal matters, upon the opinion of
counsel selected by it, which counsel may be its employees.
10.8. Reimbursement and Indemnification. The Lenders agree to reimburse
and indemnify each of the Documentation Agent and the Administrative Agent
ratably in proportion to their respective Commitments (or, if the Commitments
have been terminated, in proportion to their Commitments immediately prior to
such termination) (i) for any amounts not reimbursed by the Borrower for which
the Documentation Agent or the Administrative Agent (as applicable) is entitled
to reimbursement by the Borrower under the Loan Documents, (ii) for any other
expenses incurred by the Documentation Agent or the Administrative Agent (as
applicable) on behalf of the Lenders, in connection with the preparation,
execution, delivery, administration and enforcement of the Loan Documents and
(iii) for any liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements of any kind and nature
whatsoever which may be imposed on, incurred by or asserted against the
Documentation Agent or the Administrative Agent (as applicable) in any way
relating to or arising out of the Loan Documents or any other document delivered
in connection therewith or the transactions contemplated thereby, or the
enforcement of any of the terms thereof or of any such other documents, provided
that no Lender shall be liable for any of the foregoing to the extent they arise
from the gross negligence or willful misconduct of the Documentation Agent or
the Administrative Agent (as applicable). The obligations of the Lenders under
this Section 10.8 shall survive payment of the Obligations and termination of
this Agreement.
10.9. Notice of Default. Neither the Administrative Agent nor the
Documentation Agent shall be deemed to have knowledge or notice of the
occurrence of any Default or Unmatured Default hereunder unless it has received
written notice from a Lender or the Borrower referring to this Agreement
describing such Default or Unmatured Default and stating that such notice is a
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"notice of default". In the event that the Administrative Agent or the
Documentation Agent (as applicable) receives such a notice, it shall give prompt
notice thereof to the Lenders.
10.10. Rights as a Lender. In the event the Administrative Agent or the
Documentation Agent (as applicable) is a Lender, it shall have the same rights
and powers hereunder and under any other Loan Document as any Lender and may
exercise the same as though it were not the Administrative Agent or the
Documentation Agent (as applicable), and the term "Lender" or "Lenders" shall,
at any time when such party is a Lender, unless the context otherwise indicates,
include such party in its individual capacity. Each of the Administrative Agent
and the Documentation Agent may accept deposits from, lend money to, and
generally engage in any kind of trust, debt, equity or other transaction, in
addition to those contemplated by this Agreement or any other Loan Document,
with the Borrower or any of its Subsidiaries in which the Borrower or such
Subsidiary is not restricted hereby from engaging with any other Person. Each of
the Administrative Agent and the Documentation Agent, in its individual
capacity, is not obligated to remain a Lender.
10.l1. Lender Credit Decision. Each Lender acknowledges that it has,
independently and without reliance upon the Administrative Agent, the
Documentation Agent or any other Lender and based on the financial statements
prepared by the Borrower and such other documents and information as it has
deemed appropriate, made its own credit analysis and decision to enter into this
Agreement and the other Loan Documents. Each Lender also acknowledges that it
will, independently and without reliance upon the Administrative Agent, the
Documentation Agent or any other Lender and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit decisions in taking or not taking action under this Agreement and the
other Loan Documents.
10.12. Successor Administrative Agent and Documentation Agent. Each of the
Documentation Agent and the Administrative Agent may resign at any time by
giving written notice thereof to the Lenders and the Borrower, such resignation
to be effective upon the appointment of a successor Documentation Agent or
successor Administrative Agent (as applicable) or, if no such successor has been
appointed, forty-five days after the retiring Administrative Agent or
Documentation Agent (as applicable) gives notice of its intention to resign.
Upon any such resignation, the Required Lenders shall have the right to appoint,
on behalf of the Borrower and the Lenders, such successor. If no such successor
shall have been so appointed by the Required Lenders within thirty days after
the resigning Administrative Agent's or Documentation Agent's (as applicable)
giving notice of its intention to resign, then the resigning party may appoint,
on behalf of the Borrower and the Lenders, its successor. If the Administrative
Agent or the Documentation Agent (as applicable) has resigned and no successor
has been appointed, the Lenders may perform all the duties of the Administrative
Agent or the Documentation Agent (as applicable) hereunder and the Borrower
shall make all payments in respect of the Obligations to the applicable Lender
and for all other purposes shall deal directly with the Lenders. No successor
Administrative Agent or successor Documentation Agent shall be deemed to be
appointed hereunder until such successor has accepted the appointment. Any such
successor shall be a commercial bank having capital and retained earnings of at
least $50,000,000. Upon the acceptance of any appointment as Administrative
Agent or Documentation Agent hereunder by a successor, such successor shall
thereupon succeed to and become vested with all the rights, powers, privileges
and duties of the resigning party. Upon the effectiveness of the resignation of
the Administrative Agent or the Documentation Agent (as applicable), it shall be
discharged from its duties and obligations hereunder and under the Loan
Documents. After the effectiveness of the resignation of an Administrative Agent
or a Documentation Agent (as applicable), the provisions of this Article X shall
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continue in effect for its benefit in respect of any actions taken or omitted to
be taken by it while it was acting as the Administrative Agent or the
Documentation Agent (as applicable) hereunder and under the other Loan
Documents.
ARTICLE XI
SETOFF; RATABLE PAYMENTS
------------------------
11.1. Setoff. In addition to, and without limitation of, any rights of the
Lenders under applicable law, if the Borrower becomes insolvent, however
evidenced, or any Default or Unmatured Default occurs, any and all deposits
(including all account balances, whether provisional or final and whether or not
collected or available) and any other Indebtedness at any time held or owing by
any Lender to or for the credit or account of the Borrower may be offset and
applied toward the payment of the Obligations owing to such Lender, whether or
not the Obligations, or any part thereof, shall then be due.
11.2. Ratable Payments. If any Lender, whether by setoff or otherwise, has
payment made to it upon its Loans (other than payments received pursuant to
Section 3.1, 3.2 or 3.4) in a greater proportion than that received by any other
Lender, such Lender agrees, promptly upon demand, to purchase a portion of the
Loans held by the other Lenders so that after such purchase each Lender will
hold its ratable proportion of Loans. If any Lender, whether in connection with
setoff or amounts which might be subject to setoff or otherwise, receives
collateral or other protection for its Obligations or such amounts which may be
subject to setoff, such Lender agrees, promptly upon demand, to take such action
necessary such that all Lenders share in the benefits of such collateral ratably
in proportion to their Loans. In case any such payment is disturbed by legal
process, or otherwise, appropriate further adjustments shall be made. If any
such amount is to be applied to Indebtedness of the Borrower to a Lender, other
than Indebtedness evidenced by any of the Notes held by such Lender, such amount
shall be applied ratably to such other Indebtedness and to the Indebtedness
evidenced by such Notes.
ARTICLE XII
BENEFIT OF AGREEMENT; ASSIGNMENTS; PARTICIPATIONS
-------------------------------------------------
12.1. Successors and Assigns. The terms and provisions of the Loan
Documents shall be binding upon and inure to the benefit of the Borrower and the
Lenders and their respective successors and assigns, except that (i) the
Borrower shall not have the right to assign its rights or obligations under the
Loan Documents and (ii) any assignment by any Lender must be made in compliance
with Section 12.3. Notwithstanding clause (ii) of this Section, any Lender may
at any time, without the consent of the Borrower, the Documentation Agent or the
Administrative Agent, assign all or any portion of its rights under this
Agreement and its Notes to a Federal Reserve Bank; provided, however, that no
such assignment to a Federal Reserve Bank shall release the transferor Lender
from its obligations hereunder. The Administrative Agent and the Documentation
Agent may treat the payee of any Note as the owner thereof for all purposes
hereof unless and until such payee complies with Section 12.3 in the case of an
assignment thereof or, in the case of any other transfer, a written notice of
the transfer is filed with the Documentation Agent. Any assignee or transferee
of a Note agrees by acceptance thereof to be bound by all the terms and
provisions of the Loan Documents. Any request, authority or consent of any
Person, who at the time of making such request or giving such authority or
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consent is the holder of any Note, shall be conclusive and binding on any
subsequent holder, transferee or assignee of such Note or of any Note or Notes
issued in exchange therefor.
12.2. Participations.
12.2.1 Permitted Participants; Effect. Any Lender may, in the
ordinary course of its business and in accordance with applicable law,
at any time sell to one or more banks or other entities
("Participants") participating interests in any Loan owing to such
Lender, any Note held by such Lender, any Commitment of such Lender,
any participating interests in any Letter of Credit or unrepaid L/C
Drawing, or any other interest of such Lender under the Loan Documents.
In the event of any such sale by a Lender of participating interests to
a Participant, such Lender's obligations under the Loan Documents shall
remain unchanged, such Lender shall remain solely responsible to the
other parties hereto for the performance of such obligations, such
Lender shall remain the holder of any such Note for all purposes under
the Loan Documents, all amounts payable by the Borrower under this
Agreement shall be determined as if such Lender had not sold such
participating interests, and the Borrower, the Documentation Agent and
the Administrative Agent shall continue to deal solely and directly
with such Lender in connection with such Lender's rights and
obligations under the Loan Documents.
12.2.2. Voting Rights. Each Lender shall retain the sole right
to approve, without the consent of any Participant, any amendment,
modification or waiver of any provision of the Loan Documents other
than any amendment, modification or waiver with respect to any Loan,
Commitment, Letter of Credit or unrepaid L/C Drawing in which such
Participant has an interest which forgives principal, interest or fees
or reduces the interest rate or fees payable with respect to any such
Loan, Commitment, Letter of Credit or unrepaid L/C Drawing, postpones
any date fixed for any regularly-scheduled payment of principal of, or
interest or fees on, any such Loan, Commitment, Letter of Credit or
unrepaid L/C Drawing, releases any guarantor of any such Loan or
releases any substantial portion of collateral, if any, securing any
such Loan.
12.2.3. Benefit of Setoff. The Borrower agrees that each
Participant shall be deemed to have the right of setoff provided in
Section 11.1 in respect of its participating interest in amounts owing
under the Loan Documents to the same extent as if the amount of its
participating interest were owing directly to it as a Lender under the
Loan Documents, provided that each Lender shall retain the right of
setoff provided in Section 11.1 with respect to the amount of
participating interests sold to each Participant. The Lenders agree to
share with each Participant, and each Participant, by exercising the
right of setoff provided in Section 11.1, agrees to share with each
Lender, any amount received pursuant to the exercise of its right of
setoff, such amounts to be shared in accordance with Section 11.2 as if
each Participant were a Lender.
12.3. Assignments.
12.3.1. Permitted Assignments. With prior written notice to
the Documentation Agent and the other Lenders, any Lender may, in the
ordinary course of its business and in accordance with applicable law,
at any time assign to one or more banks or other entities
("Purchasers") all or any part of its rights and obligations under the
Loan Documents. Such assignment shall be substantially in the form of
Exhibit "D" hereto or in such other form as may be agreed to by the
parties thereto. The consent of the Documentation Agent shall be
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required prior to an assignment becoming effective with respect to a
Purchaser which is not a Lender or an Affiliate thereof. Such consent
shall not be unreasonably withheld or delayed. Each such assignment
shall be in an amount not less than the lesser of (i) $5,000,000 or
(ii) the remaining amount of the assigning Lender's Commitment
(calculated as at the date of such assignment).
12.3.2. Effect; Effective Date. Upon (i) delivery to the
Documentation Agent of a notice of assignment, substantially in the
form attached as Exhibit "I" to Exhibit "D" hereto (a "Notice of
Assignment"), together with any consents required by Section 12.3.1,
and (ii) payment of a $3,500 fee by the assignee to the Documentation
Agent for processing such assignment, such assignment shall become
effective on the effective date specified in such Notice of Assignment.
The Notice of Assignment shall contain a representation by the
Purchaser to the effect that none of the consideration used to make the
purchase of the Commitment and Loans under the applicable assignment
agreement are "plan assets" as defined under ERISA and that the rights
and interests of the Purchaser in and under the Loan Documents will not
be "plan assets" under ERISA. On and after the effective date of such
assignment, such Purchaser shall for all purposes be a Lender party to
this Agreement and any other Loan Document executed by the Lenders and
shall have all the rights and obligations of a Lender under the Loan
Documents, to the same extent as if it were an original party hereto,
and no further consent or action by the Borrower, the Lenders, the
Documentation Agent or the Administrative Agent shall be required to
release the transferor Lender with respect to the percentage of the
Aggregate Commitment and Loans assigned to such Purchaser. Upon the
consummation of any assignment to a Purchaser pursuant to this Section
12.3.2, the transferor Lender, the Documentation Agent and the Borrower
shall make appropriate arrangements so that new Notes, if appropriate,
are issued to such Purchaser.
12.4. Dissemination of Information. The Borrower authorizes each Lender to
disclose to any Participant or Purchaser or any other Person acquiring an
interest in the Loan Documents by operation of law (each a "Transferee") and any
prospective Transferee any and all information in such Lender's possession
concerning the creditworthiness of the Borrower and its Subsidiaries; provided
that each Transferee and prospective Transferee agrees to be bound by Section
9.12 of this Agreement.
12.5. Tax Treatment. If any interest in any Loan Document is transferred to
any Transferee which is organized under the laws of any jurisdiction other than
the United States or any State thereof, the transferor Lender shall cause such
Transferee, concurrently with the effectiveness of such transfer, to comply with
the provisions of Section 4.3.
ARTICLE XIII
NOTICES
-------
13.1. Notices. Except as otherwise permitted by Section 2.13 with respect
to borrowing notices, all notices, requests and other communications to any
party hereunder shall be in writing (including bank wire, facsimile transmission
or similar writing) and shall be given to such party: (x) in the case of the
Borrower, the Documentation Agent or the Administrative Agent, at its address or
facsimile number set forth on the signature pages hereof, (y) in the case of any
Lender, at its address or facsimile number set forth on the signature pages
hereof or in its administrative questionnaire or (z) in the case of any party,
such other address or facsimile number as such party may hereafter specify for
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the purpose by notice to the Administrative Agent, the Documentation Agent and
the Borrower. Each such notice, request or other communication shall be
effective (i) if given by facsimile transmission, when transmitted to the
facsimile number specified in this Section and confirmation of receipt is
received, (ii) if given by mail, 72 hours after such communication is deposited
in the mails with first class postage prepaid, addressed as aforesaid or (iii)
if given by any other means, when delivered at the address specified in this
Section; provided that notices to the Administrative Agent under Article II
shall not be effective until received.
13.2. Change of Address. The Borrower, the Administrative Agent, the
Documentation Agent and any Lender may each change the address for service of
notice upon it by a notice in writing to the other parties hereto.
ARTICLE XIV
COUNTERPARTS
------------
This Agreement may be executed in any number of counterparts, all of which
taken together shall constitute one agreement, and any of the parties hereto may
execute this Agreement by signing any such counterpart. This Agreement shall be
effective (with such effectiveness being retroactive to July 1, 1998) when it
has been executed by the Borrower, the Administrative Agent, the Documentation
Agent and the Lenders and each party has notified the Documentation Agent by
telefacsimile or telephone, that it has taken such action.
ARTICLE XV
CHOICE OF LAW, CONSENT TO JURISDICTION, WAIVER OF JURY TRIAL
------------------------------------------------------------
15.1. CHOICE OF LAW. THE LOAN DOCUMENTS (OTHER THAN THOSE CONTAINING A
CONTRARY EXPRESS CHOICE OF LAW PROVISION) SHALL BE CONSTRUED IN ACCORDANCE WITH
THE INTERNAL LAWS (AND NOT THE LAW OF CONFLICTS) OF THE STATE OF CALIFORNIA, BUT
GIVING EFFECT TO FEDERAL LAWS APPLICABLE TO NATIONAL BANKS.
15.2. CONSENT TO JURISDICTION. THE BORROWER HEREBY IRREVOCABLY SUBMITS TO
THE NON-EXCLUSIVE JURISDICTION OF ANY UNITED STATES FEDERAL OR CALIFORNIA STATE
COURT SITTING IN LOS ANGELES IN ANY ACTION OR PROCEEDING ARISING OUT OF OR
RELATING TO ANY LOAN DOCUMENTS AND THE BORROWER HEREBY IRREVOCABLY AGREES THAT
ALL CLAIMS IN RESPECT OF SUCH ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED
IN ANY SUCH COURT AND IRREVOCABLY WAIVES ANY OBJECTION IT MAY NOW OR HEREAFTER
HAVE AS TO THE VENUE OF ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN SUCH A
COURT OR THAT SUCH COURT IS AN INCONVENIENT FORUM. NOTHING HEREIN SHALL LIMIT
THE RIGHT OF THE ADMINISTRATIVE AGENT, THE DOCUMENTATION AGENT OR ANY LENDER TO
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BRING PROCEEDINGS AGAINST THE BORROWER IN THE COURTS OF ANY OTHER JURISDICTION.
ANY JUDICIAL PROCEEDING BY THE BORROWER AGAINST THE ADMINISTRATIVE AGENT, THE
DOCUMENTATION AGENT OR ANY LENDER OR ANY AFFILIATE OF THE ADMINISTRATIVE AGENT,
THE DOCUMENTATION AGENT OR ANY LENDER INVOLVING, DIRECTLY OR INDIRECTLY, ANY
MATTER IN ANY WAY ARISING OUT OF, RELATED TO, OR CONNECTED WITH ANY LOAN
DOCUMENT SHALL BE BROUGHT ONLY IN A COURT IN LOS ANGELES, CALIFORNIA.
15.3. WAIVER OF JURY TRIAL. THE BORROWER, THE ADMINISTRATIVE AGENT, THE
DOCUMENTATION AGENT AND EACH LENDER HEREBY WAIVE TRIAL BY JURY IN ANY JUDICIAL
PROCEEDING INVOLVING, DIRECTLY OR INDIRECTLY, ANY MATTER (WHETHER SOUNDING IN
TORT, CONTRACT OR OTHERWISE) IN ANY WAY ARISING OUT OF, RELATED TO, OR CONNECTED
WITH ANY LOAN DOCUMENT OR THE RELATIONSHIP ESTABLISHED THEREUNDER.
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IN WITNESS WHEREOF, the Borrower, the Lenders, the Documentation Agent and
the Administrative Agent have executed this Agreement as of the date first above
written.
SOS STAFFING SERVICES, INC.
By:
Print Name:
Title:
0000 Xxxxx Xxxx Xxxxxx
Xxxx Xxxx Xxxx, Xxxx 00000
Fax: (000) 000-0000
Attention: Xx. Xxxx Xxxxx
THE FIRST NATIONAL BANK OF CHICAGO,
as the Documentation Agent and as a Lender
By:
Print Name:
Title:
000 Xxxxx Xxxxxxxx Xxxxxx, 0xx Xxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Fax: (000) 000-0000
Attention: Xx. Xxxxx X. Xxxxx
With copy to:
One First Xxxxxxxx Xxxxx, 00xx Xxxxx
Xxxxxxx, Xxxxxxxx 00000
Fax: (000) 000-0000
Attention: Xx. Xxxxxx Xxxxx
FIRST SECURITY BANK, N.A.,
as the Administrative Agent and as a Lender
By:
Print Name:
Title:
15 East 000 Xxxxx, 0xx Xxxxx
Xxxx Xxxx Xxxx, Xxxx 00000
Fax: (000) 000-0000
Attention: Xx. Xxxxx X. Xxxxxxxx
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EXHIBIT "A"
NOTE
Salt Lake City, Utah
--------------------
FOR VALUE RECEIVED, SOS STAFFING SERVICES, INC., a Utah corporation (the
"Borrower"), hereby unconditionally promises to pay to the order of (the
"Lender") at the office of First Security Bank, N.A., a national banking
association (the "Administrative Agent"), located at 15 East 000 Xxxxx, 0xx
Xxxxx, Xxxx Xxxx Xxxx, Xxxx 00000, in lawful money of the United States and in
immediately available funds, on the dates required under that certain Amended
and Restated Credit Agreement dated as of July 27, 1998 among the Borrower, the
lenders from time to time party thereto, including the Lender, the Documentation
Agent and the Administrative Agent (as the same may be amended or modified and
in effect from time to time, the "Agreement"), the aggregate unpaid principal
amount of all Loans made by the Lender to the Borrower pursuant to Article II of
the Agreement.
The Borrower further agrees to pay interest in like money and funds at the
office of the Administrative Agent referred to above, on the unpaid principal
balance hereof from the date advanced until paid in full at the applicable rates
and on the dates set forth in the Agreement. The Borrower shall pay the
principal of and accrued and unpaid interest on the Loans in full on or before
the Facility Termination Date. The holder of this Note is hereby authorized to
record the date and amount of each Loan and the date and amount of each payment
of principal and interest, and applicable interest rates and other information
with respect thereto, on the schedules annexed to and constituting a part of
this Note (or by any analogous method the holder hereof may elect consistent
with its customary practices) and any such recordation shall, absent manifest
error, constitute conclusive evidence of the accuracy of the information so
recorded; provided, however, that the failure to make a notation or the
inaccuracy of any notation shall not limit or otherwise affect the obligations
of the Borrower under the Agreement and this Note.
This Note is one of the Notes issued pursuant to, and is entitled to the
benefits of, the Agreement, to which reference is hereby made for a statement of
the terms and conditions governing this Note, including the terms and conditions
under which this Note may be prepaid or its maturity date accelerated. This Note
is guaranteed pursuant to the Guaranties, all as more specifically described in
the Agreement, and reference is made thereto for a statement of the terms and
provisions thereof. Capitalized terms used herein and not otherwise defined
herein are used with the meanings attributed to them in the Agreement.
SOS STAFFING SERVICES, INC.
By:
Print Name:
Title:
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SCHEDULE OF LOANS AND PAYMENTS
TO
NOTE OF SOS STAFFING SERVICES, INC.,
DATED _________, ____
Interest Principal Maturity Principal
Amount of Interest Interest Amount Unpaid Amount
Date Loan Period Rate Paid Balance Paid
---- ---------- ----------- --------- ------- --------- ----
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EXHIBIT "B"
FORM OF OPINION
July __, 1998
The Documentation Agent, the Administrative Agent and the Lenders who are
parties to the Agreement described below.
Ladies and Gentlemen:
We have acted as counsel for SOS Staffing Services, Inc. (the "Borrower")
and each of the Guarantors in connection with the execution and delivery of that
certain Amended and Restated Credit Agreement dated as of July 27, 1998 (the
"Agreement") among the Borrower, the Lenders named therein, The First National
Bank of Chicago, as the Documentation Agent, and First Security Bank, N.A., as
the Administrative Agent, and the other Loan Documents in connection therewith.
This opinion is being furnished to the Documentation Agent, the Administrative
Agent and the Lenders pursuant to the provisions of Section 4.1(ix) of the
Agreement. All capitalized terms used in this opinion and not otherwise defined
herein shall have the meanings attributed to them in the Agreement.
We have examined executed copies of each of the Loan Documents and copies
of the articles of incorporation and by-laws (with all amendments respectively
thereto) of each of the Borrower and the Guarantors, and certified copies of
resolutions adopted by the Board of Directors of the Borrower on _____________,
1998, authorizing the execution and delivery of the Loan Documents to which the
Borrower is party, and certified copies of resolutions adopted by the Board of
Directors of each of the Guarantors on ___________, 1998, authorizing the
execution and delivery of the Loan Documents to which such Guarantor is party.
We are generally familiar with the business and operations of the Borrower and
the Guarantors. We have examined such statutes, decisions and matters of law and
other documents as we deemed necessary to express the following opinions.
In our examination made for the purpose of rendering these opinions, we
have relied upon the certificates of incumbency this day furnished to us as to
the genuineness of all signatures. After due inquiry and examination, we have
assumed for the purpose of the opinions the authenticity of all other documents
submitted to us as originals and the conformity with originals of all other
documents submitted to us as certified copies. As to any questions of fact
material to such opinions, we have, when relevant facts were not independently
established, relied upon certificates of governmental officials and certificates
of officers of the Company, copies of which are attached hereto.
The opinions hereinafter expressed are subject to the following
qualifications:
(a) The effect of applicable bankruptcy and other similar laws
affecting the rights of creditors generally; and
(b) The effect of rules of law governing specific performance,
injunctive relief or other equitable remedies.
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Based upon the foregoing, it is our opinion that:
l. Each of the Borrower and its Subsidiaries is a corporation duly
incorporated, validly existing and in good standing under the laws of its
jurisdiction of incorporation and has all requisite authority to conduct its
business in each jurisdiction in which its business is conducted.
2. Each of the Borrower and the Guarantors has the corporate power and
authority and legal right to execute and deliver the Loan Documents to which it
is party and to perform its obligations thereunder. The execution and delivery
of the Loan Documents by the Borrower and the Guarantors and the performance of
their respective obligations thereunder have been duly authorized by proper
corporate proceedings, the Loan Documents to which the Borrower is party
constitute legal, valid and binding obligations of the Borrower enforceable
against the Borrower in accordance with their terms, and the Loan Documents to
which each Guarantor is party constitute legal, valid and binding obligations of
such Guarantor enforceable against such Guarantor in accordance with their
terms. The execution and delivery by the Borrower or any Guarantor of the Loan
Documents, the consummation of the transactions therein contemplated, and
compliance with the provisions thereof will not:
(a) require any consent of the Borrower's shareholders;
(b) violate any law, rule, regulation, order, writ, judgment,
injunction, decree or award binding on the Borrower or any of the
Guarantors or the Borrower's or any Guarantor's articles of
incorporation or by-laws or the provisions of any indenture, instrument
or agreement to which the Borrower or any of the Guarantors is a party
or is subject; or
(c) result in, or require, the creation or imposition of any
Lien pursuant to the provisions of any indenture, instrument or
agreement to which the Borrower or any of the Guarantors is a party or
is subject.
3. There is no litigation or proceeding against the Borrower or any of its
Subsidiaries which, if adversely determined, could have a Material Adverse
Effect.
4. No approval, authorization, consent, adjudication or order of any
governmental authority, which has not been obtained by the Borrower or any of
the Guarantors, is required to be obtained by the Borrower or any of the
Guarantors in connection with the execution and delivery of the Loan Documents,
the borrowings under the Agreement or in connection with the payment by the
Borrower or any Guarantor of the Obligations.
This opinion may be relied upon by the Documentation Agent, the
Administrative Agent, the Lenders and their participants, assignees and other
transferees.
Very truly yours,
------------
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EXHIBIT "C"
COMPLIANCE CERTIFICATE
To: The Lenders parties to the
Agreement Described Below
This Compliance Certificate is furnished pursuant to that certain Amended
and Restated Credit Agreement dated as of July 27, 1998 (as amended, modified,
renewed or extended from time to time, the "Agreement") among SOS Staffing
Services, Inc. (the "Borrower"), the lenders party thereto, The First National
Bank of Chicago, as the Documentation Agent, and First Security Bank, N.A., as
the Administrative Agent. Unless otherwise defined herein, capitalized terms
used in this Compliance Certificate have the meanings ascribed thereto in the
Agreement.
THE UNDERSIGNED HEREBY CERTIFIES THAT:
1. I am the duly elected of the Borrower;
----------------------
2. I have reviewed the terms of the Agreement and I have made, or have
caused to be made under my supervision, a detailed review of the transactions
and conditions of the Borrower and its Subsidiaries during the accounting period
covered by the attached financial statements;
3. The examinations described in paragraph 2 did not disclose, and I have
no knowledge of, the existence of any condition or event which constitutes a
Default or Unmatured Default during or at the end of the accounting period
covered by the attached financial statements or as of the date of this
Certificate, except as set forth below; and
4. Schedule I attached hereto sets forth financial data and computations
evidencing the Borrower's compliance with certain covenants of the Agreement,
all of which data and computations are true, complete and correct.
5. Schedule II attached hereto sets forth the determination of the interest
rate to be paid for Advances commencing the first day of the month following the
delivery hereof.
6. Schedule III attached hereto sets forth the various reports and
deliveries which are required under the Credit Agreement and the other Loan
Documents and the status of compliance.
Described below are the exceptions, if any, to paragraph 3 by listing, in
detail, the nature of the condition or event, the period during which it has
existed and the action which the Borrower has taken, is taking, or proposes to
take with respect to each such condition or event:
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----------------------------------------
----------------------------------------
----------------------------------------
----------------------------------------
The foregoing certifications, together with the computations set forth in
Schedule I and Schedule II hereto and the financial statements delivered with
this Certificate in support hereof, are made and delivered this day of , 19 .
----------------------
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SCHEDULE I TO COMPLIANCE CERTIFICATE
Compliance as of _________, 199_ with
Provisions of Sections 6.16, 6.18, 6.19 and 6.20 of
the Agreement
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SCHEDULE II TO COMPLIANCE CERTIFICATE
Rate Determination
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SCHEDULE III TO COMPLIANCE CERTIFICATE
Reports and Deliveries
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EXHIBIT "D"
ASSIGNMENT AGREEMENT
This Assignment Agreement (this "Assignment Agreement") between (the
"Assignor") and (the "Assignee") is dated as of , 19 . The parties hereto agree
as follows:
1. PRELIMINARY STATEMENT. The Assignor is a party to a Credit Agreement
(which, as it may be amended, modified, renewed or extended from time to time is
herein called the "Credit Agreement") described in Item 1 of Schedule 1 attached
hereto ("Schedule 1"). Capitalized terms used herein and not otherwise defined
herein shall have the meanings attributed to them in the Credit Agreement.
2. ASSIGNMENT AND ASSUMPTION. The Assignor hereby sells and assigns to the
Assignee, and the Assignee hereby purchases and assumes from the Assignor, an
interest in and to the Assignor's rights and obligations under the Credit
Agreement such that after giving effect to such assignment the Assignee shall
have purchased pursuant to this Assignment Agreement the percentage interest
specified in Item 3(b) of Schedule 1 of all outstanding rights and obligations
under the Credit Agreement and the other Loan Documents. The aggregate
Commitment purchased by the Assignee hereunder is set forth in Item 4 of
Schedule 1.
3. EFFECTIVE DATE. The effective date of this Assignment Agreement (the
"Effective Date") shall be the later of the date specified in Item 5 of Schedule
1 and the date a Notice of Assignment substantially in the form of Exhibit "I"
attached hereto has been delivered to the Documentation Agent. Such Notice of
Assignment must include any consents required to be delivered to the
Documentation Agent by Section 12.3.1 of the Credit Agreement. In no event will
the Effective Date occur if the payments required to be made by the Assignee to
the Assignor on the Effective Date under Sections 4 and 5 hereof are not made on
the proposed Effective Date. The Assignor will notify the Assignee of the
proposed Effective Date no later than the Business Day prior to the proposed
Effective Date. As of the Effective Date, (i) the Assignee shall have the rights
and obligations of a Lender under the Loan Documents with respect to the rights
and obligations assigned to the Assignee hereunder and (ii) the Assignor shall
relinquish its rights and be released from its corresponding obligations under
the Loan Documents with respect to the rights and obligations assigned to the
Assignee hereunder.
4. PAYMENTS OBLIGATIONS. On and after the Effective Date, the Assignee
shall be entitled to receive from the Administrative Agent all payments of
principal, interest and fees with respect to the interest assigned hereby. The
Assignee shall advance funds directly to the Administrative Agent with respect
to all Loans and reimbursement payments made on or after the Effective Date with
respect to the interest assigned hereby. In consideration for the sale and
assignment of Loans hereunder, (i) the Assignee shall pay the Assignor, on the
Effective Date, an amount equal to the principal amount of the portion of all
Floating Rate Loans assigned to the Assignee hereunder and (ii) with respect to
each Fixed Rate Loan made by the Assignor and assigned to the Assignee hereunder
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which is outstanding on the Effective Date, (a) on the last day of the Interest
Period therefor or (b) on such earlier date agreed to by the Assignor and the
Assignee or (c) on the date on which any such Fixed Rate Loan either becomes due
(by acceleration or otherwise) or is prepaid (the date as described in the
foregoing clauses (a), (b) or (c) being hereinafter referred to as the "Payment
Date"), the Assignee shall pay the Assignor an amount equal to the principal
amount of the portion of such Fixed Rate Loan assigned to the Assignee which is
outstanding on the Payment Date. If the Assignor and the Assignee agree that the
Payment Date for such Fixed Rate Loan shall be the Effective Date, they shall
agree to the interest rate applicable to the portion of such Loan assigned
hereunder for the period from the Effective Date to the end of the existing
Interest Period applicable to such Fixed Rate Loan (the "Agreed Interest Rate")
and any interest received by the Assignee in excess of the Agreed Interest Rate
shall be remitted to the Assignor. In the event interest for the period from the
Effective Date to but not including the Payment Date is not paid by the Borrower
with respect to any Fixed Rate Loan sold by the Assignor to the Assignee
hereunder, the Assignee shall pay to the Assignor interest for such period on
the portion of such Fixed Rate Loan sold by the Assignor to the Assignee
hereunder at the applicable rate provided by the Credit Agreement. In the event
a prepayment of any Fixed Rate Loan which is existing on the Payment Date and
assigned by the Assignor to the Assignee hereunder occurs after the Payment Date
but before the end of the Interest Period applicable to such Fixed Rate Loan,
the Assignee shall remit to the Assignor the excess of the prepayment penalty
paid with respect to the portion of such Fixed Rate Loan assigned to the
Assignee hereunder over the amount which would have been paid if such prepayment
penalty was calculated based on the Agreed Interest Rate. The Assignee will also
promptly remit to the Assignor (i) any principal payments received from the
Administrative Agent with respect to Fixed Rate Loans prior to the Payment Date
and (ii) any amounts of interest on Loans and fees received from the
Administrative Agent which relate to the portion of the Loans assigned to the
Assignee hereunder for periods prior to the Effective Date, in the case of
Floating Rate Loans or fees, or the Payment Date, in the case of Fixed Rate
Loans, and not previously paid by the Assignee to the Assignor. In the event
that either party hereto receives any payment to which the other party hereto is
entitled under this Assignment Agreement, then the party receiving such amount
shall promptly remit it to the other party hereto.
5. FEES PAYABLE BY THE ASSIGNEE. The Assignee shall pay to the Assignor a
fee on each day on which a payment of interest or fees is made under the Credit
Agreement with respect to the amounts assigned to the Assignee hereunder (other
than a payment of interest or fees for the period prior to the Effective Date
or, in the case of Fixed Rate Loans, the Payment Date, which the Assignee is
obligated to deliver to the Assignor pursuant to Section 4 hereof). The amount
of such fee shall be the difference between (i) the interest or fee, as
applicable, paid with respect to the amounts assigned to the Assignee hereunder
and (ii) the interest or fee, as applicable, which would have been paid with
respect to the amounts assigned to the Assignee hereunder if each interest rate
was of 1% less than the interest rate paid by the Borrower or if the fee was of
1% less than the fee paid by the Borrower, as applicable. In addition, the
Assignee agrees to pay % of the recordation fee required to be paid to the
Administrative Agent in connection with this Assignment Agreement.
6. REPRESENTATIONS OF THE ASSIGNOR; LIMITATIONS ON THE ASSIGNOR'S
LIABILITY. The Assignor represents and warrants that it is the legal and
beneficial owner of the interest being assigned by it hereunder and that such
interest is free and clear of any adverse claim created by the Assignor. It is
understood and agreed that the assignment and assumption hereunder are made
without recourse to the Assignor and that the Assignor makes no other
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representation or warranty of any kind to the Assignee. Neither the Assignor nor
any of its officers, directors, employees, agents or attorneys shall be
responsible for (i) the due execution, legality, validity, enforceability,
genuineness, sufficiency or collectability of any Loan Document, including
without limitation, documents granting the Assignor and the other Lenders a
security interest in assets of the Borrower or any guarantor, (ii) any
representation, warranty or statement made in or in connection with any of the
Loan Documents, (iii) the financial condition or creditworthiness of the
Borrower or any guarantor, (iv) the performance of or compliance with any of the
terms or provisions of any of the Loan Documents, (v) inspecting any of the
Property, books or records of the Borrower, (vi) the validity, enforceability,
perfection, priority, condition, value or sufficiency of any collateral securing
or purporting to secure the Loans or (vii) any mistake, error of judgment, or
action taken or omitted to be taken in connection with the Loans or the Loan
Documents.
7. REPRESENTATIONS OF THE ASSIGNEE. The Assignee (i) confirms that it has
received a copy of the Credit Agreement, together with copies of the financial
statements requested by the Assignee and such other documents and information as
it has deemed appropriate to make its own credit analysis and decision to enter
into this Assignment Agreement, (ii) agrees that it will, independently and
without reliance upon the Administrative Agent, the Documentation Agent, the
Assignor or any other Lender and based on such documents and information at it
shall deem appropriate at the time, continue to make its own credit decisions in
taking or not taking action under the Loan Documents, (iii) appoints and
authorizes the Administrative Agent and the Documentation Agent to take such
action as agent on its behalf and to exercise such powers under the Loan
Documents as are delegated to the Administrative Agent and the Documentation
Agent by the terms thereof, together with such powers as are reasonably
incidental respectively thereto, (iv) agrees that it will perform in accordance
with their terms all of the obligations which by the terms of the Loan Documents
are required to be performed by it as a Lender, (v) agrees that its payment
instructions and notice instructions are as set forth in the attachment to
Schedule 1, (vi) confirms that none of the funds, monies, assets or other
consideration being used to make the purchase and assumption hereunder are "plan
assets" as defined under ERISA and that its rights, benefits and interests in
and under the Loan Documents will not be "plan assets" under ERISA, and *[(vii)
attaches the forms prescribed by the Internal Revenue Service of the United
States certifying that the Assignee is entitled to receive payments under the
Loan Documents without deduction or withholding of any United States federal
income taxes].*
*to be inserted if the Assignee is not incorporated under the laws of the United
States, or a state thereof.
8. INDEMNITY. The Assignee agrees to indemnify and hold the Assignor
harmless against any and all losses, costs and expenses (including, without
limitation, reasonable attorneys' fees) and liabilities incurred by the Assignor
in connection with or arising in any manner from the Assignee's non-performance
of the obligations assumed under this Assignment Agreement.
9. SUBSEQUENT ASSIGNMENTS. After the Effective Date, the Assignee shall
have the right pursuant to Section 12.3.1 of the Credit Agreement to assign the
rights which are assigned to the Assignee hereunder to any entity or person,
provided that (i) any such subsequent assignment does not violate any of the
terms and conditions of the Loan Documents or any law, rule, regulation, order,
writ, judgment, injunction or decree and that any consent required under the
terms of the Loan Documents has been obtained and (ii) unless the prior written
1a-222232
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consent of the Assignor is obtained, the Assignee is not thereby released from
its obligations to the Assignor hereunder, if any remain unsatisfied, including,
without limitation, its obligations under Sections 4, 5 and 8 hereof.
10. REDUCTIONS OF AGGREGATE COMMITMENT. If any reduction in the Aggregate
Commitment occurs between the date of this Assignment Agreement and the
Effective Date, the percentage interest specified in Item 3 of Schedule 1 shall
remain the same, but the dollar amount purchased shall be recalculated based on
the reduced Aggregate Commitment.
11. ENTIRE AGREEMENT. This Assignment Agreement and the attached Notice of
Assignment embody the entire agreement and understanding between the parties
hereto and supersede all prior agreements and understandings between the parties
hereto relating to the subject matter hereof.
12. GOVERNING LAW. This Assignment Agreement shall be governed by the
internal law, and not the law of conflicts, of the State of California.
13. NOTICES. Notices shall be given under this Assignment Agreement in the
manner set forth in the Credit Agreement. For the purpose hereof, the addresses
of the parties hereto (until notice of a change is delivered) shall be the
address set forth in the attachment to Schedule 1.
IN WITNESS WHEREOF, the parties hereto have executed this Assignment
Agreement by their duly authorized officers as of the date first above written.
[NAME OF ASSIGNOR]
By:
---------------------
Title:
------------------
------------------
------------------
[NAME OF ASSIGNEE]
By:
---------------------
Title:
------------------
------------------
------------------
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SCHEDULE 1
to Assignment Agreement
1. Description and Date of Credit Agreement:
2. Date of Assignment Agreement: , 19
------------
3. Amounts (As of Date of Item 2 above):
a. Aggregate Commitment
under the
Credit Agreement $
----------
b. Assignee's percentage
of the Aggregate Commitment
purchased
under the Assignment
Agreement %
-----
4. Assignee's Commitment purchased
under the Assignment Agreement $
---------
5. Proposed Effective Date:
-----------
Accepted and Agreed:
[NAME OF ASSIGNOR] [NAME OF ASSIGNEE]
By: By:
------------------------ ---------------------------
Title: Title:
--------------------- ------------------------
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Attachment to SCHEDULE 1 to ASSIGNMENT AGREEMENT
Attach Assignor's Administrative Information Sheet, which must
include notice address for the Assignee
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EXHIBIT "I"
to Assignment Agreement
NOTICE
OF ASSIGNMENT
-------------
, 19
-----
To: THE FIRST NATIONAL BANK OF CHICAGO
From: [NAME OF ASSIGNOR] (the "Assignor")
[NAME OF ASSIGNEE] (the "Assignee")
1. We refer to that Credit Agreement (the "Credit Agreement")
described in Item 1 of Schedule 1 attached hereto ("Schedule 1"). Capitalized
terms used herein and not otherwise defined herein shall have the meanings
attributed to them in the Credit Agreement.
2. This Notice of Assignment (this "Notice") is given and
delivered to the Documentation Agent pursuant to Section 12.3.2 of the Credit
Agreement.
3. The Assignor and the Assignee have entered into an Assignment
Agreement, dated as of , 19 (the "Assignment"), pursuant to which, among other
things, the Assignor has sold, assigned, delegated and transferred to the
Assignee, and the Assignee has purchased, accepted and assumed from the Assignor
the percentage interest specified in Item 3 of Schedule 1 of all outstandings,
rights and obligations under the Credit Agreement relating to the facilities
listed in Item 3 of Schedule 1. The Effective Date of the Assignment shall be
the later of the date specified in Item 5 of Schedule 1 or two Business Days (or
such shorter period as agreed to by the Documentation Agent) after this Notice
of Assignment and any consents and fees required by Sections 12.3.1 and 12.3.2
of the Credit Agreement have been delivered to the Documentation Agent, provided
that the Effective Date shall not occur if any condition precedent agreed to by
the Assignor and the Assignee has not been satisfied.
4. The Assignor and the Assignee hereby give to the Borrower and
the Documentation Agent notice of the assignment and delegation referred to
herein. The Assignor will confer with the Documentation Agent before the date
specified in Item 5 of Schedule 1 to determine if the Assignment Agreement will
become effective on such date pursuant to Section 3 hereof, and will confer with
the Documentation Agent to determine the Effective Date pursuant to Section 3
hereof if it occurs thereafter. The Assignor shall notify the Documentation
Agent if the Assignment Agreement does not become effective on any proposed
Effective Date as a result of the failure to satisfy the conditions precedent
agreed to by the Assignor and the Assignee. At the request of the Documentation
Agent, the Assignor will give the Documentation Agent written confirmation of
the satisfaction of the conditions precedent.
5. The Assignor or the Assignee shall pay to the Documentation
Agent on or before the Effective Date the processing fee of $3,500 required by
Section 12.3.2 of the Credit Agreement.
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6. The Assignor and the Assignee request and direct that the
Documentation Agent prepare and cause the Borrower to execute and deliver a new
Note, if appropriate, to the Assignee. The Assignor, if it will no longer be a
Lender, agrees to deliver to the Documentation Agent the original Note received
by it from the Borrower upon its receipt of the appropriate amount.
7. The Assignee advises the Documentation Agent that notice and
payment instructions are set forth in the attachment to Schedule 1.
8. The Assignee hereby represents and warrants that none of the
funds, monies, assets or other consideration being used to make the purchase
pursuant to the Assignment are "plan assets" as defined under ERISA and that its
rights, benefits, and interests in and under the Loan Documents will not be
"plan assets" under ERISA.
9. The Assignee authorizes the Documentation Agent and the
Administrative Agent to act as its agent under the Loan Documents in accordance
with the terms thereof. The Assignee acknowledges that neither the Documentation
Agent nor the Administrative Agent has any duty to supply information with
respect to the Borrower or the Loan Documents to the Assignee until the Assignee
becomes a party to the Credit Agreement.
NAME OF ASSIGNOR NAME OF ASSIGNEE
By: By:
---------------------- -----------------------
Title: Title:
------------------- --------------------
ACKNOWLEDGED AND CONSENTED TO BY
THE FIRST NATIONAL BANK OF CHICAGO,
as Documentation Agent
By:
----------------------
Title:
-------------------
[Attach photocopy of Schedule 1 to Assignment]
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EXHIBIT "E"
LOAN/CREDIT RELATED MONEY TRANSFER INSTRUCTION
To First Security Bank , N.A.,
as Administrative Agent (the "Administrative Agent") under the Credit Agreement
Described Below.
Re: Amended and Restated Credit Agreement, dated July 27, 1998 (as the same
may be amended or modified, the "Credit Agreement"), among SOS Staffing
Services, Inc. (the "Borrower"), the Lenders named therein, the
Documentation Agent, and the Administrative Agent. Capitalized terms
used herein and not otherwise defined herein shall have the meanings
assigned thereto in the Credit Agreement.
The Administrative Agent is specifically authorized and directed to act
upon the following standing money transfer instructions with respect to the
proceeds of Advances or other extensions of credit from time to time until
receipt by the Administrative Agent of a specific written revocation of such
instructions by the Borrower, provided, however, that the Administrative Agent
may otherwise transfer funds as hereafter directed in writing by the Borrower in
accordance with Section 13.1 of the Credit Agreement or based on any telephonic
notice made in accordance with Section 2.13 of the Credit Agreement.
Facility Identification Number(s)
-----------------------------------------------
Customer/Account Name
-----------------------------------------------------------
Transfer Funds To
---------------------------------------------------------------
---------------------------------------------------------------
---------------------------------------------------------------
For Account No.
-----------------------------------------------------------------
Reference/Attention To
----------------------------------------------------------
Authorized Officer (Customer Representative) Date
----------------------------
------------------
------------------------------ --------------------------------
(Please Print) Signature
Bank Officer Name Date
------------------------------
------------------------------ --------------------------------
(Please Print) Signature
(Deliver Completed Form to Credit Support Staff For Immediate Processing)
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EXHIBIT "F"
GUARANTY
THIS GUARANTY (the "Guaranty") is made and dated as of the ___
day of ______, 19__ by _________________________, a _______________________
("Guarantor").
RECITALS
A. This Guaranty is being executed and delivered to The First National
Bank of Chicago, acting in its capacity as documentation agent (in such
capacity, the "Documentation Agent") for the lenders from time to time party to
that certain Amended and Restated Credit Agreement dated as of July 27, 1998 by
and among SOS Staffing Services, Inc. (the "Borrower"), the Administrative
Agent, the Documentation Agent, and the lenders from time to time party thereto
(the "Lenders") (as amended, extended and replaced from time to time, the
"Credit Agreement," and with capitalized terms not otherwise defined herein used
with the meanings given such terms in the Credit Agreement).
B. Pursuant to the Credit Agreement the Lenders have agreed to extend
credit to the Borrower on the terms and subject to the conditions set forth
therein.
C. Pursuant to the terms of the Credit Agreement, Guarantor is
required, among other things, to execute and deliver this Guaranty to the
Documentation Agent for the benefit of the Lenders.
NOW, THEREFORE, in consideration of the above Recitals and for
other good and valuable consideration, the receipt and adequacy of which are
hereby acknowledged, Guarantor hereby agrees as follows:
AGREEMENT
1. Guarantor hereby absolutely and unconditionally guarantees
the payment when due, upon maturity, acceleration or otherwise, of all
obligations of the Borrower to the Lenders under the Credit Agreement and the
other Loan Documents (as defined in the Credit Agreement), whether heretofore,
now, or hereafter made, incurred or created, whether voluntary or involuntary
and however arising, absolute or contingent, liquidated or unliquidated,
determined or undetermined (collectively and severally, the "Guaranteed
Obligations"), whether or not such Guaranteed Obligations are from time to time
reduced, or extinguished and thereafter increased or incurred, whether the
Borrower may be liable individually or jointly with others, whether or not
recovery upon such Guaranteed Obligations may be or hereafter become barred by
any statute of limitations, and whether or not such Guaranteed Obligations may
be or hereafter become otherwise unenforceable.
2. Guarantor hereby absolutely and unconditionally guarantees
the payment of the Guaranteed Obligations, whether or not due or payable by the
Borrower, upon: (a) the dissolution, insolvency or business failure of, or any
assignment for benefit of creditors by, or commencement of any bankruptcy,
reorganization, arrangement, moratorium or other debtor relief proceedings by or
against, either the Borrower or Guarantor, or (b) the appointment of a receiver
1a-222232
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for, or the attachment, restraint of or making or levying of any order of court
or legal process affecting, the property of either the Borrower or Guarantor,
and unconditionally promises to pay such Guaranteed Obligations to the
Documentation Agent for the benefit of the Lenders, or order, on demand, in
lawful money of the United States.
3. The liability of Guarantor hereunder is exclusive and
independent of any security for or other guaranty of the Guaranteed Obligations,
whether executed by Guarantor or by any other party, and the liability of
Guarantor hereunder is not affected or impaired by (a) any direction of
application of payment by the Borrower or by any other party, or (b) any other
guaranty, undertaking or maximum liability of Guarantor or of any other party as
to the Guaranteed Obligations, or (c) any payment on or in reduction of any such
other guaranty or undertaking, or (d) any revocation or release of any
obligations of any other guarantor of the Guaranteed Obligations, or (e) any
dissolution, termination or increase, decrease or change in personnel of
Guarantor, or (f) any payment made to the Administrative Agent, the
Documentation Agent or any Lender on the Guaranteed Obligations which the
Administrative Agent, the Documentation Agent or any Lender repays to the
Borrower pursuant to court order in any bankruptcy, reorganization, arrangement,
moratorium or other debtor relief proceeding, and Guarantor waives any right to
the deferral or modification of Guarantor's obligations hereunder by reason of
any such proceeding.
4. (a) The obligations of Guarantor hereunder are independent
of the obligations of the Borrower with respect to the Guaranteed Obligations,
and a separate action or actions may be brought and prosecuted against Guarantor
whether or not action is brought against the Borrower and whether or not the
Borrower be joined in any such action or actions. Guarantor waives, to the
fullest extent permitted by law, the benefit of any statute of limitations
affecting its liability hereunder or the enforcement thereof. Any payment by the
Borrower or other circumstance which operates to toll any statute of limitations
as to the Borrower shall operate to toll the statute of limitations as to
Guarantor.
(b) All payments made by Guarantor under this Guaranty
shall be made without set-off or counterclaim and free and clear of and without
deductions for any present or future taxes, fees, withholdings or conditions of
any nature ("Taxes"). Guarantor shall pay any such Taxes, including Taxes on any
amounts so paid, and will promptly furnish any Lender copies of any tax receipts
or such other evidence of payment as such Lender may require.
5. Guarantor authorizes the Administrative Agent, the
Documentation Agent and Lenders (whether or not after termination of this
Guaranty), without notice or demand (except as shall be required by applicable
statute and cannot be waived), and without affecting or impairing its liability
hereunder, from time to time to (a) renew, compromise, extend, increase,
accelerate or otherwise change the time for payment of, or otherwise change the
terms of Guaranteed Obligations or any part thereof, including increase or
decrease of the rate of interest thereon; (b) take and hold security for the
payment of this Guaranty or the Guaranteed Obligations and exchange, enforce,
waive and release any such security; (c) apply such security and direct the
order or manner of sale thereof as the Administrative Agent, the Documentation
Agent and Lenders in their discretion may determine; and (d) release or
substitute any one or more endorsers, guarantors, the Borrower or other
obligors. The Administrative Agent, the Documentation Agent and Lenders may,
without notice to or the further consent of the Borrower or Guarantor, assign
this Guaranty in whole or in part to any person acquiring an interest in the
Guaranteed Obligations.
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6. It is not necessary for the Documentation Agent, the
Administrative Agent or any Lender to inquire into the capacity or power of the
Borrower or the officers acting or purporting to act on their behalf, and
Guaranteed Obligations made or created in reliance upon the professed exercise
of such powers shall be guaranteed hereunder.
7. Guarantor waives any right to require the Documentation
Agent, the Administrative Agent or any Lender to (a) proceed against the
Borrower or any other party; (b) proceed against or exhaust any security held
from the Borrower; or (c) pursue any other remedy whatsoever. Guarantor waives
any personal defense based on or arising out of any personal defense of the
Borrower other than payment in full of the Guaranteed Obligations, including,
without limitation, any defense based on or arising out of the disability of
either the Borrower, or the unenforceability of the Guaranteed Obligations or
any part thereof from any cause, or the cessation from any cause of the
liability of the Borrower other than payment in full of the Guaranteed
Obligations. The Documentation Agent, the Administrative Agent and the Lenders
may, at their election, foreclose on any security held for the Guaranteed
Obligations by one or more judicial or nonjudicial sales, or exercise any other
right or remedy they may have against the Borrower, or any security, without
affecting or impairing in any way the liability of Guarantor hereunder except to
the extent the Guaranteed Obligations have been paid. Guarantor waives all
rights and defenses arising out of an election of remedies, even though that
election of remedies, such as a nonjudicial foreclosure with respect to security
for a guaranteed obligation, has destroyed Guarantor's rights of subrogation and
reimbursement against the principal by operation of Section 580d of the
California Code of Civil Procedure.
8. Guarantor hereby waives any claim or other rights which
Guarantor may now have or may hereafter acquire against the Borrower or any
other guarantor of all or any of the Guaranteed Obligations that arise from the
existence or performance of Guarantor's obligations under this Guaranty or any
other of the Loan Documents (all such claims and rights being referred to as the
"Guarantor's Conditional Rights"), including, without limitation, any right of
subrogation, reimbursement, exoneration, contribution, or indemnification, any
right to participate in any claim or remedy which the Documentation Agent, the
Administrative Agent or any Lender has against the Borrower or any collateral
which the Documentation Agent, the Administrative Agent or any Lender now has or
hereafter acquires for the Guaranteed Obligations, whether or not such claim,
remedy or right arises in equity or under contract, statute or common law, by
any payment made hereunder or otherwise, including, without limitation, the
right to take or receive from the Borrower, directly or indirectly, in cash or
other property or by setoff or in any other manner, payment or security on
account of such claim or other rights. If, notwithstanding the foregoing
provisions, any amount shall be paid to Guarantor on account of Guarantor's
Conditional Rights and either (a) such amount is paid to Guarantor at any time
when the Guaranteed Obligations shall not have been paid or performed in full,
or (b) regardless of when such amount is paid to Guarantor any payment made by
the Borrower to the Documentation Agent, the Administrative Agent or any Lender
is at any time determined to be a preferential payment, then such amount paid to
Guarantor shall be deemed to be held in trust for the benefit of the Lenders and
shall forthwith be paid to the Documentation Agent for the benefit of the
Lenders to be credited and applied upon the Guaranteed Obligations, whether
matured or unmatured, in such order and manner as Lenders, in their sole
discretion, shall determine. To the extent that any of the provisions of this
Paragraph 8 shall not be enforceable, Guarantor agrees that until such time as
the Guaranteed Obligations have been paid and performed in full and the period
of time has expired during which any payment made by the Borrower or Guarantor
may be determined to be a preferential payment, Guarantor's Conditional Rights
1a-222232
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to the extent not validly waived shall be subordinate to the Lenders' right to
full payment and performance of the Guaranteed Obligations and Guarantor shall
not seek to enforce Guarantor's Conditional Rights during such period.
9. Guarantor waives all presentments, demands for
performance, protests and notices, including, without limitation, notices of
nonperformance, notices of protest, notices of dishonor, notices of acceptance
of this Guaranty, and notices of the existence, creation or incurring of new or
additional Guaranteed Obligations. Guarantor assumes all responsibility for
being and keeping itself informed of either the Borrower's financial condition
and assets, and of all other circumstances bearing upon the risk of nonpayment
of the Guaranteed Obligations and the nature, scope and extent of the risks
which Guarantor assumes and incurs hereunder, and agrees that neither the
Documentation Agent, the Administrative Agent nor any Lender shall have a duty
to advise Guarantor of information known to it regarding such circumstances or
risks.
10. In addition to the Guaranteed Obligations, Guarantor
agrees to pay reasonable attorneys' fees and all other reasonable costs and
expenses incurred by the Documentation Agent, the Administrative Agent and the
Lenders in enforcing this Guaranty in any action or proceeding arising out of or
relating to this Guaranty.
11. Guarantor has reviewed and approved the Credit Agreement
and the Loan Documents. Guarantor agrees to execute any and all further
documents, instruments and agreements as the Documentation Agent from time to
time reasonably requests to evidence Guarantor's obligations hereunder.
12. This Guaranty and the other Loan Documents shall be
governed by and construed in accordance with the substantive laws of the State
of California.
_________________________________________, a
______________________ corporation
By: ________________________________
Name: ______________________________
Title: _______________________________
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EXHIBIT "G"
SUBORDINATION AGREEMENT
THIS SUBORDINATION AGREEMENT (the "Subordination Agreement")
is made and dated as of the ___ day of _______, 19__ by and among SOS STAFFING
SERVICES, INC., a Utah corporation (the "Borrower"), THE FIRST NATIONAL BANK OF
CHICAGO, acting in its capacity as documentation agent (in such capacity, the
"Documentation Agent") for the lenders from time to time party to that certain
Amended and Restated Credit Agreement dated as of July 27, 1998 by and among the
Borrower, the Administrative Agent, the Documentation Agent, and the lenders
from time to time party thereto (the "Lenders") (as amended, extended and
replaced from time to time, the "Credit Agreement," and with capitalized terms
not otherwise defined herein used with the meanings given such terms in the
Credit Agreement), and ____________________________, a _________________
corporation (the "Creditor").
RECITALS
A. Pursuant to the Credit Agreement the Lenders have agreed to
extend credit to the Borrower on the terms and subject to the conditions set
forth therein.
B. Pursuant to the terms of the Credit Agreement, the Creditor
is required to subordinate its right to the payment of monies from the Borrower
to the payment and performance of the Obligations under (and as defined in) the
Credit Agreement (the "Senior Obligations"), and to execute and deliver this
Subordination Agreement to the Documentation Agent for the benefit of the
Lenders as evidence thereof.
NOW, THEREFORE, in consideration of the above Recitals and for
other good and valuable consideration, the receipt and adequacy of which are
hereby acknowledged, the parties hereto hereby agree as follows:
AGREEMENT
1. The Creditor has extended and may in the future extend
credit to the Borrower from time to time. The principal of all now existing and
hereafter arising indebtedness of the Borrower to the Creditor together with
accrued but unpaid interest thereon is hereinafter referred to as the "Claims".
2. The Creditor is or will be the sole and absolute owner of
the Claims and has not sold, assigned, transferred or otherwise disposed of any
right it may have to repayment of the Claims or any security therefor.
3. The Claims and all rights and remedies of the Creditor with
respect thereto and any lien securing payment thereof are and shall continue to
be subject, subordinate and rendered junior in the right of payment to the
Senior Obligations, as the same may be extended, amended or replaced form time
to time.
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4. Unless and until the Senior Obligations shall have been
fully paid and discharged and any agreement by the Lenders to make further loans
or advances to the Borrower shall have terminated:
(a) The Borrower will not make or give, and the
Creditor will not receive, directly or indirectly, any payment, advance, credit
or further security of any kind whatsoever on account of the Claims, or any new
or further evidence thereof;
(b) The Creditor will not sell, assign, transfer or
endorse the Claims or any part or evidence thereof;
(c) The Creditor will not modify the Claims or any
part or evidence thereof; and
(d) The Creditor will not take, or permit any action
to be taken, to assert, collect or enforce the Claims
or any part thereof.
5. Each of the Borrower and the Creditor waives notice of
acceptance of this Subordination Agreement by the Lenders, and each of the
Creditor waives notice of and consent to the amount and terms of any loan or
loans which the Lenders may from time to time make to the Borrower and any
renewal or extension thereof and any action which the Lenders in their sole and
absolute discretion may take or omit to take with respect thereto.
6. This Subordination Agreement shall constitute a continuing
agreement of subordination and the Lenders may, from time to time and without
notice to the Creditor, lend money to or make other financial arrangements with
the Borrower in reliance hereon until written notice of termination shall be
delivered by the Creditor to the Lenders by certified mail, return receipt
requested. The receipt by the Lenders of such notice shall not affect this
Subordination Agreement as it relates to any Senior Obligations then existing,
to any Senior Obligations incurred thereafter pursuant to a previous commitment
by the Lenders or to any amendments to, or extensions or renewals of, any such
Senior Obligations.
7. In the event of a default in the performance or observance
of any of the foregoing, the Senior Obligations shall forthwith become due and
payable at the election of the Lenders, without presentment, demand or notice of
any kind, all of which are hereby waived.
8. The Creditor agrees as follows:
(a) Upon any distribution of all of the assets of the
Borrower to creditors of the Borrower upon the dissolution, winding up,
liquidation, arrangement, or reorganization of the Borrower, whether in any
bankruptcy, insolvency, arrangement, reorganization or receivership proceeding
or upon an assignment for the benefit of creditors or any other marshalling of
the assets and liabilities of the Borrower or otherwise, any payment or
distribution of any kind (whether in cash, property or securities) which
otherwise would be payable or deliverable upon or with respect to the Claims
shall be paid or delivered directly to the Administrative Agent for application
(in the case of cash) to, or as collateral (in the case of non-cash property or
securities) for, the payment or prepayment of the Senior Obligations until the
Senior Obligations shall have been paid in full.
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(b) If any proceeding referred to in subsection (a)
above is commenced by or against the Borrower:
(1) The Lenders are hereby irrevocably
authorized and empowered (in their own name or in the name of the Creditor or
otherwise), but shall have no obligation, to demand, xxx for, collect and
receive every payment or distribution referred to in subsection (a) above and
give acquittance therefor and to file claims and proofs of claim and take such
other action (including, without limitation, voting the Claims or enforcing any
security interest or other lien securing payment of the Claims) as the Lenders
may deem necessary or advisable for the exercise or enforcement of any of the
rights or interests of the Lenders hereunder; and
(2) The Creditor shall duly and promptly
take such action as the Lenders may request (i) to collect the Claims for
account of the Lenders and to file appropriate claims or proofs of claim in
respect of the Claims, (ii) to execute and deliver to the Administrative Agent
such powers of attorney, assignments, or other instruments as it may request in
order to enable it to enforce any and all claims with respect to, and any
security interests and other liens securing payment of, the Claims, and (iii) to
collect and receive any and all payments or distributions which may be payable
or deliverable upon or with respect to the Claims.
(c) All payments or distributions upon or with
respect to the Claims which are received by the Creditor contrary to the
provisions of this Subordination Agreement shall be received in trust for the
benefit of the Lenders, shall be segregated from other funds and property held
by the Creditor and shall be forthwith paid over to the Administrative Agent in
the same form as so received (with any necessary endorsement) to be applied (in
the case of cash) to, or held as collateral (in the case of non-cash property or
securities) for, the payment or prepayment of the Senior Obligations.
(d) The Documentation Agent on behalf of the Lenders
is hereby authorized to demand specific performance of this Subordination
Agreement, whether or not the Borrower shall have complied with any or all of
the provisions hereof applicable to the Borrower, at any time when the Creditor
shall have failed to comply with any of the provisions of this Subordination
Agreement applicable to it.
9. It is the intent of the Creditor to create by this
Subordination Agreement a security interest in favor of the Documentation Agent
for the benefit of the Lenders in the Claims and in the Creditor's other rights
to receive money or other property from the Borrower, whether such rights shall
constitute accounts, contract rights, chattel paper, instruments, general
intangibles or otherwise. The Creditor hereby grants to the Documentation Agent
for the benefit of the Lenders a security interest in the Claims in order to
secure the payment and performance of the Creditor' obligations pursuant to this
Subordination Agreement.
10. The Creditor authorizes the Documentation Agent and the
Lenders (whether or not after revocation of this Subordination Agreement),
without notice or demand (except as shall be required by applicable statute and
cannot be waived), and without affecting or impairing the Creditor's obligations
hereunder, from time to time to (a) renew, compromise, extend, increase,
accelerate or otherwise change the time for payment of, or otherwise change the
terms of the Senior Obligations or any part thereof, including without
limitation to increase or decrease the rate of interest thereon; (b) take and
1a-222232
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hold security for the payment of the Senior Obligations and exchange, enforce,
waive and release any such security; (c) apply such security and direct the
order or manner of sale thereof as the Documentation Agent, the Administrative
Agent and the Lenders in their sole discretion may determine; and (d) release
and substitute any one or more endorsers, warrantors, the Borrower or other
obligors.
11. This Subordination Agreement shall extend to and be
binding upon the successors and assigns of each of the parties hereto.
12. This Subordination Agreement may be executed in any
number of counterparts all of which taken together shall constitute one
agreement and any party hereto may execute this Subordination Agreement by
signing any such counterpart.
13. This Subordination Agreement shall be construed in
accordance with and governed by the substantive laws of the State of California.
THE FIRST NATIONAL BANK OF CHICAGO,
as Documentation Agent
By: ___________________________
Name:__________________________
Title:____________________________
SOS STAFFING SERVICES, INC., a Utah
corporation
By: _______________________________
Name:______________________________
Title:_______________________________
------------------------------------
By: ________________________________
Name: ______________________________
Title: _______________________________
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SCHEDULE "1"
SUBSIDIARIES AND OTHER INVESTMENTS
(See Sections 5.8 and 6.14)
Investment Amount of Percent Jurisdiction of
In Investment Ownership Organization
-- ---------- --------- ------------
Bedford Consultants, Inc. 100% California
Computer Professional Resources, Inc. 100% Kansas
SOS Information Technology Company 100% Utah
ServCom Staff Management, Inc. 100% Utah
SOS Collection Services, Inc. 100% Arizona
Xxxxx & Associates, Inc. 100% New Mexico
All of the above Subsidiaries are directly owned by the Borrower.
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SCHEDULE "2"
INDEBTEDNESS AND LIENS
(See Sections 5.14, 6.11 and 6.15)
Maturity
Indebtedness Indebtedness Property Interest and Amount
Incurred By Owed To Encumbered (If Any) Rate of Indebtedness
----------- ------- ------------------- ---- ---------------
[to be provided by the Borrower]
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SCHEDULE "3"
LITIGATION
(See Section 5.7)
[to be provided by the Borrower]
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SCHEDULE "4"
INITIAL COMMITMENT SCHEDULE
LENDER COMMITMENT PERCENTAGE
The First National Bank of Chicago $25,000,000 62.5000%
First Security Bank, N.A. $15,000,000 37.5000%
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TABLE OF CONTENTS
ARTICLE I - DEFINITIONS...........................................................................................1
ARTICLE II - THE CREDITS..........................................................................................12
2.1. Commitment...........................................................................................12
2.2. Required Payments....................................................................................12
2.3. Ratable Loans........................................................................................12
2.4. Types of Advances....................................................................................12
2.5. Commitment Fee; Reductions in Aggregate Commitment...................................................12
2.6. Minimum Amount of Each Advance.......................................................................12
2.7. Optional Principal Payments..........................................................................13
2.8. Method of Selecting Types and Interest Periods for New Advances......................................13
2.9. Conversion and Continuation of Outstanding Advances..................................................13
2.10. Changes in Interest Rate, etc........................................................................14
2.11. Rates Applicable After Default.......................................................................14
2.12. Method of Payment....................................................................................14
2.13. Notes; Telephonic Notices............................................................................14
2.14. Interest Payment Dates; Interest and Fee Basis.......................................................15
2.15. Notification of Advances, Interest Rates, Prepayments and Commitment Reductions......................15
2.16. Lending Installations................................................................................15
2.17. Non-Receipt of Funds by the Administrative Agent.....................................................15
2.18. Mandatory Prepayment in the Event of a Change in Control.............................................16
2.19. Issuance of Letters of Credit........................................................................16
2.20. Purchase of Participation Interests..................................................................16
2.21. Repayment of L/C Drawings............................................................................17
2.22. Absolute Obligation to Repay.........................................................................17
2.23. Uniform Customs and Practice.........................................................................17
2.24. Relationship to Letter of Credit Application.........................................................18
2.25. Letter of Credit Fee.................................................................................18
2.26. Guaranties and Subordination Agreements..............................................................18
ARTICLE III - CHANGE IN CIRCUMSTANCES..............................................................................18
3.1. Yield Protection.....................................................................................18
3.2. Changes in Capital Adequacy Regulations..............................................................19
3.3. Availability of Types of Advances....................................................................19
3.4. Funding Indemnification..............................................................................19
3.5. Lender Statements; Survival of Indemnity.............................................................19
ARTICLE IV - CONDITIONS PRECEDENT.................................................................................20
4.1. Initial Advance......................................................................................20
4.2. Each Advance.........................................................................................21
4.3. Withholding Tax Exemption............................................................................21
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ARTICLE V - REPRESENTATIONS AND WARRANTIES.......................................................................22
5.1. Corporate Existence and Standing.....................................................................22
5.2. Authorization and Validity...........................................................................22
5.3. No Conflict; Government Consent......................................................................22
5.4. Financial Statements.................................................................................23
5.5. Material Adverse Change..............................................................................23
5.6. Taxes................................................................................................23
5.7. Litigation and Contingent Obligations................................................................23
5.8. Subsidiaries.........................................................................................23
5.9. ERISA................................................................................................23
5.l0. Accuracy of Information..............................................................................23
5.11. Regulation U.........................................................................................24
5.12. Material Agreements..................................................................................24
5.13. Compliance With Laws.................................................................................24
5.14. Ownership of Properties..............................................................................24
5.15. Plan Assets; Prohibited Transactions.................................................................24
5.16. Environmental Matters................................................................................24
5.17. Investment Company Act...............................................................................24
5.18. Public Utility Holding Company Act...................................................................25
5.19. Year 2000 Program....................................................................................25
ARTICLE VI - COVENANTS............................................................................................25
6.1. Financial Reporting..................................................................................25
6.2. Use of Proceeds......................................................................................26
6.3. Notice of Default....................................................................................26
6.4. Conduct of Business..................................................................................26
6.5. Taxes................................................................................................27
6.6. Insurance............................................................................................27
6.7. Compliance with Laws.................................................................................27
6.8. Maintenance of Properties............................................................................27
6.9. Inspection...........................................................................................27
6.10. Dividends............................................................................................27
6.11. Indebtedness.........................................................................................27
6.12. Merger...............................................................................................28
6.13. Sale of Assets.......................................................................................28
6.14. Investments and Acquisitions.........................................................................28
6.15. Liens................................................................................................29
6.16. Total Indebtedness / Total Capital Ratio.............................................................29
6.17. Affiliates...........................................................................................30
6.18. Net Worth............................................................................................30
6.19. Total Indebtedness / Adjusted EBITDA Ratio...........................................................30
6.20. Interest Coverage Ratio..............................................................................30
6.21. Year 2000 Program....................................................................................30
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ARTICLE VII - DEFAULTS.............................................................................................30
ARTICLE VIII - ACCELERATION, WAIVERS, AMENDMENTS AND REMEDIES.......................................................32
8.1. Acceleration.........................................................................................32
8.2. Amendments...........................................................................................33
8.3. Preservation of Rights...............................................................................33
ARTICLE IX - GENERAL PROVISIONS...................................................................................34
9.1. Survival of Representations..........................................................................34
9.2. Governmental Regulation..............................................................................34
9.3. Taxes................................................................................................34
9.4. Headings.............................................................................................34
9.5. Entire Agreement.....................................................................................34
9.6. Several Obligations; Benefits of this Agreement......................................................34
9.7. Expenses; Indemnification............................................................................34
9.8. Numbers of Documents.................................................................................35
9.9. Accounting...........................................................................................35
9.10. Severability of Provisions...........................................................................35
9.11. Nonliability of Lenders..............................................................................35
9.12. Confidentiality......................................................................................35
9.13. Nonreliance..........................................................................................36
ARTICLE X - THE ADMINISTRATIVE AGENT.............................................................................36
10.1. Appointment; Nature of Relationship..................................................................36
10.2. Powers...............................................................................................36
10.3. General Immunity.....................................................................................36
10.4. No Responsibility for Loans, Recitals, etc...........................................................37
10.5. Action on Instructions of Lenders....................................................................37
10.6. Employment of Agents and Counsel.....................................................................37
10.7. Reliance on Documents; Counsel.......................................................................37
10.8. Reimbursement and Indemnification....................................................................37
10.9. Notice of Default....................................................................................38
10.10. Rights as a Lender...................................................................................38
10.l1. Lender Credit Decision...............................................................................38
10.12. Successor Administrative Agent and Documentation Agent...............................................38
ARTICLE XI - SETOFF; RATABLE PAYMENTS.............................................................................39
11.1. Setoff...............................................................................................39
11.2. Ratable Payments.....................................................................................39
ARTICLE XII - BENEFIT OF AGREEMENT; ASSIGNMENTS; PARTICIPATIONS....................................................40
12.1. Successors and Assigns...............................................................................40
12.2. Participations.......................................................................................40
12.2.1 Permitted Participants; Effect...............................................................40
12.2.2. Voting Rights...............................................................................40
12.2.3. Benefit of Setoff...........................................................................41
12.3. Assignments..........................................................................................41
12.3.1. Permitted Assignments.......................................................................41
12.3.2. Effect; Effective Date......................................................................41
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12.4. Dissemination of Information.........................................................................41
12.5. Tax Treatment........................................................................................42
ARTICLE XIII - NOTICES..............................................................................................42
13.1. Notices..............................................................................................42
13.2. Change of Address....................................................................................42
ARTICLE XIV - COUNTERPARTS.........................................................................................42
ARTICLE XV - CHOICE OF LAW, CONSENT TO JURISDICTION, WAIVER OF JURY TRIAL.........................................43
15.1. CHOICE OF LAW........................................................................................43
15.2. CONSENT TO JURISDICTION..............................................................................43
15.3. WAIVER OF JURY TRIAL.................................................................................43
EXHIBIT "A"- NOTE......................................................................................................45
EXHIBIT "B"- FORM OF OPINION...........................................................................................47
EXHIBIT "C"- COMPLIANCE CERTIFICATE....................................................................................49
EXHIBIT "D"- ASSIGNMENT AGREEMENT......................................................................................54
EXHIBIT "E"- LOAN/CREDIT RELATED MONEY TRANSFER INSTRUCTION............................................................62
EXHIBIT "F"- GUARANTY..................................................................................................63
EXHIBIT "G"- SUBORDINATION AGREEMENT...................................................................................67
SCHEDULE "1"- SUBSIDIARIES AND OTHER INVESTMENTS
SCHEDULE "2"- INDEBTEDNESS AND LIENS
SCHEDULE "3"- LITIGATION
SCHEDULE "4" -INITIAL COMMITMENT SCHEDULE
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