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EXHIBIT (B)(1)
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CREDIT AGREEMENT
DATED AS OF APRIL 26, 2000
AMONG
XXXXX SYSTEMS GROUP, INC.
AND
ASG SUB, INC.
AND
VARIOUS FINANCIAL INSTITUTIONS
AND
LASALLE BANK NATIONAL ASSOCIATION
AS ADMINISTRATIVE AGENT
AND
KEYBANK NATIONAL ASSOCIATION
AS SYNDICATION AGENT
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TABLE OF CONTENTS
SECTION 1 DEFINITIONS..........................................................................................1
1.1 DEFINITIONS..........................................................................................1
1.2 OTHER INTERPRETIVE PROVISIONS.......................................................................11
SECTION 2 COMMITMENTS OF THE BANKS; BORROWING, CONVERSION AND LETTER OF CREDIT PROCEDURES.....................12
2.1 COMMITMENTS.........................................................................................12
2.1.1 Revolving Loan Commitment.....................................................................12
2.1.2 L/C Commitment................................................................................12
2.2 LOAN PROCEDURES.....................................................................................12
2.2.1 Various Types of Loans........................................................................13
2.2.2 Borrowing Procedures..........................................................................13
2.2.3 Conversion and Continuation Procedures........................................................14
2.3 LETTER OF CREDIT PROCEDURES.........................................................................15
2.3.1 L/C Applications..............................................................................15
2.3.2 Participations in Letters of Credit...........................................................15
2.3.3 Reimbursement Obligations.....................................................................15
2.3.4 Limitation on Obligations of Issuing Bank.....................................................16
2.3.5 Funding by Banks to Issuing Bank..............................................................16
2.4 COMMITMENTS SEVERAL.................................................................................16
2.5 CERTAIN CONDITIONS..................................................................................16
SECTION 3 NOTES EVIDENCING LOANS..............................................................................17
3.1 NOTES...............................................................................................17
3.2 RECORDKEEPING.......................................................................................17
SECTION 4 INTEREST............................................................................................17
4.1 INTEREST RATES......................................................................................17
4.2 INTEREST PAYMENT DATES..............................................................................17
4.3 SETTING AND NOTICE OF EURODOLLAR RATES..............................................................17
4.4 COMPUTATION OF INTEREST.............................................................................18
SECTION 5 FEES................................................................................................18
5.1 NON-USE FEE.........................................................................................18
5.2 LETTER OF CREDIT FEES...............................................................................18
5.3 UPFRONT FEES........................................................................................18
5.4 AGENT'S FEES........................................................................................19
SECTION 6 REDUCTION OR TERMINATION OF THE REVOLVING COMMITMENT AMOUNT; PREPAYMENTS............................19
6.1 REDUCTION OR TERMINATION OF THE REVOLVING COMMITMENT AMOUNT.........................................19
6.1.1 Voluntary Reduction or Termination of the Revolving Commitment Amount.........................19
6.1.2 Mandatory Reductions of Revolving Commitment Amount...........................................19
6.1.3 All Reductions of the Revolving Commitment Amount.............................................19
6.2 PREPAYMENTS.........................................................................................19
6.2.1 Voluntary Prepayments.........................................................................19
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6.2.2 Mandatory Prepayments.........................................................................20
6.3 ALL PREPAYMENTS.....................................................................................20
SECTION 7 MAKING AND PRORATION OF PAYMENTS; SETOFF; TAXES.....................................................20
7.1 MAKING OF PAYMENTS..................................................................................20
7.2 APPLICATION OF CERTAIN PAYMENTS.....................................................................21
7.3 DUE DATE EXTENSION..................................................................................21
7.4 SETOFF..............................................................................................21
7.5 PRORATION OF PAYMENTS...............................................................................21
7.6 TAXES...............................................................................................21
SECTION 8 INCREASED COSTS; SPECIAL PROVISIONS FOR EURODOLLAR LOANS............................................22
8.1 INCREASED COSTS.....................................................................................22
8.2 BASIS FOR DETERMINING INTEREST RATE INADEQUATE OR UNFAIR............................................23
8.3 CHANGES IN LAW RENDERING EURODOLLAR LOANS UNLAWFUL..................................................24
8.4 FUNDING LOSSES......................................................................................24
8.5 RIGHT OF BANKS TO FUND THROUGH OTHER OFFICES........................................................24
8.6 DISCRETION OF BANKS AS TO MANNER OF FUNDING.........................................................25
8.7 MITIGATION OF CIRCUMSTANCES; REPLACEMENT OF BANKS...................................................25
8.8 CONCLUSIVENESS OF STATEMENTS; SURVIVAL OF PROVISIONS................................................25
SECTION 9 WARRANTIES..........................................................................................26
9.1 ORGANIZATION........................................................................................26
9.2 AUTHORIZATION; NO CONFLICT..........................................................................26
9.3 VALIDITY AND BINDING NATURE.........................................................................26
9.4 FINANCIAL CONDITION.................................................................................26
9.5 NO MATERIAL ADVERSE CHANGE..........................................................................26
9.6 LITIGATION AND CONTINGENT LIABILITIES...............................................................27
9.7 OWNERSHIP OF PROPERTIES; LIENS......................................................................27
9.8 SUBSIDIARIES........................................................................................27
9.9 PENSION PLANS.......................................................................................27
9.10 INVESTMENT COMPANY ACT..............................................................................27
9.11 PUBLIC UTILITY HOLDING COMPANY ACT..................................................................27
9.12 REGULATION U........................................................................................28
9.13 TAXES...............................................................................................28
9.14 SOLVENCY, ETC.......................................................................................28
9.15 ENVIRONMENTAL MATTERS...............................................................................28
9.16 YEAR 2000 PROBLEM...................................................................................29
9.17 INSURANCE...........................................................................................29
9.18 REAL PROPERTY.......................................................................................29
9.19 INFORMATION.........................................................................................30
9.20 INTELLECTUAL PROPERTY...............................................................................30
9.21 BURDENSOME OBLIGATIONS..............................................................................30
9.22 LABOR MATTERS.......................................................................................30
9.23 NO DEFAULT..........................................................................................30
9.24 MERGER AGREEMENT, ETC...............................................................................30
SECTION 10 COVENANTS...........................................................................................31
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10.1 REPORTS, CERTIFICATES AND OTHER INFORMATION.........................................................31
10.1.1 Annual Report................................................................................31
10.1.2 Interim Reports..............................................................................32
10.1.3 Compliance Certificates......................................................................32
10.1.4 Reports to the SEC and to Shareholders.......................................................32
10.1.5 Notice of Default, Litigation and ERISA Matters..............................................32
10.1.6 Management Reports...........................................................................33
10.1.7 Projections..................................................................................33
10.1.8 Subordinated Debt Notices....................................................................33
10.1.9 Year 2000 Problem............................................................................34
10.1.10 Other Information...........................................................................34
10.2 BOOKS, RECORDS AND INSPECTIONS......................................................................34
10.3 MAINTENANCE OF PROPERTY; INSURANCE..................................................................34
10.4 COMPLIANCE WITH LAWS; PAYMENT OF TAXES AND LIABILITIES..............................................35
10.5 MAINTENANCE OF EXISTENCE, ETC.......................................................................35
10.6 FINANCIAL COVENANTS.................................................................................35
10.6.1 Fixed Charge Coverage Ratio..................................................................35
10.6.2 Total Debt to EBITDA Ratio...................................................................35
10.6.3 EBITDA.......................................................................................36
10.6.4 Minimum Consolidated Net Worth...............................................................36
10.6.5 Maximum Capital Expenditures.................................................................36
10.7 LIMITATIONS ON DEBT.................................................................................37
10.8 LIENS...............................................................................................37
10.9 OPERATING LEASES....................................................................................38
10.10 RESTRICTED PAYMENTS.................................................................................38
10.11 MERGERS, CONSOLIDATIONS, SALES......................................................................39
10.12 MODIFICATION OF ORGANIZATIONAL DOCUMENTS............................................................40
10.13 USE OF PROCEEDS.....................................................................................40
10.14 FURTHER ASSURANCES..................................................................................40
10.15 TRANSACTIONS WITH AFFILIATES........................................................................41
10.16 EMPLOYEE BENEFIT PLANS..............................................................................41
10.17 ENVIRONMENTAL MATTERS...............................................................................41
10.18 UNCONDITIONAL PURCHASE OBLIGATIONS..................................................................41
10.19 INCONSISTENT AGREEMENTS.............................................................................41
10.20 BUSINESS ACTIVITIES.................................................................................41
10.21 INVESTMENTS.........................................................................................41
10.22 RESTRICTION OF AMENDMENTS TO CERTAIN DOCUMENTS......................................................42
10.23 FISCAL YEAR.........................................................................................42
10.24 CANCELLATION OF DEBT................................................................................42
10.25 THE MERGER..........................................................................................42
SECTION 11 EFFECTIVENESS; CONDITIONS OF LENDING, ETC...........................................................43
11.1 INITIAL CREDIT EXTENSION............................................................................43
11.1.1 Notes........................................................................................43
11.1.2 Resolutions..................................................................................43
11.1.3 Consents, etc................................................................................43
11.1.4 Incumbency and Signature Certificates........................................................43
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11.1.5 Guaranty.....................................................................................43
11.1.6 Security Agreement...........................................................................43
11.1.7 Pledge Agreements............................................................................43
11.1.8 Real Estate Documents........................................................................44
11.1.9 Opinions of Counsel..........................................................................44
11.1.10 Insurance...................................................................................44
11.1.11 Copies of Documents.........................................................................44
11.1.12 Payment of Fees.............................................................................44
11.1.13 Solvency Certificate........................................................................44
11.1.14 Search Results; Lien Terminations...........................................................44
11.1.15 Filings, Registrations and Recordings.......................................................44
11.1.16 Closing Certificate.........................................................................45
11.1.17 Disbursement Letter.........................................................................45
11.1.18 Other.......................................................................................45
11.2 ADDITIONAL CONDITIONS RELATING TO THE TENDER OFFER AND THE MERGER...................................45
11.2.1 Guaranty.....................................................................................45
11.2.2 Security Agreement...........................................................................45
11.2.3 Solvency Certificate.........................................................................46
11.2.4 Opinions of Counsel..........................................................................46
11.2.5 Search Results; Lien Terminations............................................................46
11.2.6 Filings, Registrations and Recordings........................................................46
11.2.7 Opinion of Counsel...........................................................................46
11.2.8 Closing Certificate..........................................................................46
11.2.9 Other........................................................................................46
11.3 CONDITIONS..........................................................................................46
11.3.1 Compliance with Warranties, No Default, etc..................................................46
11.3.2 Confirmatory Certificate.....................................................................47
SECTION 12 EVENTS OF DEFAULT AND THEIR EFFECT..................................................................47
12.1 EVENTS OF DEFAULT...................................................................................47
12.1.1 Non-Payment of the Loans, etc................................................................47
12.1.2 Non-Payment of Other Debt....................................................................47
12.1.3 Other Material Obligations...................................................................47
12.1.4 Bankruptcy, Insolvency, etc..................................................................47
12.1.5 Non-Compliance with Loan Documents...........................................................48
12.1.6 Warranties...................................................................................48
12.1.7 Pension Plans................................................................................48
12.1.8 Judgments....................................................................................48
12.1.9 Invalidity of Guaranty, etc..................................................................48
12.1.10 Invalidity of Collateral Documents, etc.....................................................48
12.1.11 Invalidity of Subordination Provisions, etc.................................................49
12.1.12 Change of Control...........................................................................49
12.1.13 Material Adverse Effect.....................................................................49
12.2 EFFECT OF EVENT OF DEFAULT..........................................................................49
SECTION 13 THE AGENT...........................................................................................49
13.1 APPOINTMENT AND AUTHORIZATION.......................................................................49
13.2 DELEGATION OF DUTIES................................................................................50
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13.3 LIABILITY OF AGENT..................................................................................50
13.4 RELIANCE BY AGENT...................................................................................50
13.5 NOTICE OF DEFAULT...................................................................................51
13.6 CREDIT DECISION.....................................................................................51
13.7 INDEMNIFICATION.....................................................................................51
13.8 AGENT IN INDIVIDUAL CAPACITY........................................................................52
13.9 SUCCESSOR AGENT.....................................................................................52
13.10 COLLATERAL MATTERS..................................................................................52
SECTION 14 GENERAL.............................................................................................53
14.1 WAIVER; AMENDMENTS..................................................................................53
14.2 CONFIRMATIONS.......................................................................................54
14.3 NOTICES.............................................................................................54
14.4 COMPUTATIONS........................................................................................54
14.5 [INTENTIONALLY OMITTED].............................................................................54
14.6 COSTS, EXPENSES AND TAXES...........................................................................54
14.7 SUBSIDIARY REFERENCES...............................................................................55
14.8 CAPTIONS............................................................................................55
14.9 ASSIGNMENTS; PARTICIPATIONS.........................................................................55
14.9.1 Assignments..................................................................................55
14.9.2 Participations...............................................................................56
14.10 GOVERNING LAW.......................................................................................57
14.11 COUNTERPARTS........................................................................................57
14.12 SUCCESSORS AND ASSIGNS..............................................................................57
14.13 INDEMNIFICATION BY THE COMPANY......................................................................57
14.14 NONLIABILITY OF LENDERS.............................................................................58
14.15 FORUM SELECTION AND CONSENT TO JURISDICTION.........................................................58
14.16 WAIVER OF JURY TRIAL................................................................................58
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SCHEDULES
Pricing Schedule
SCHEDULE 2.1 Banks and Pro Rata Shares
SCHEDULE 9.6 Litigation and Contingent Liabilities
SCHEDULE 9.8 Subsidiaries
SCHEDULE 9.15 Environmental Matters
SCHEDULE 9.17 Insurance
SCHEDULE 9.18 Real Property
SCHEDULE 9.22 Labor Matters
SCHEDULE 10.7 Existing Debt
SCHEDULE 10.8 Existing Liens
SCHEDULE 10.10 Calculation of Permitted Tax Distributions
SCHEDULE 10.21 Investments
SCHEDULE 11.1 Debt to be Repaid
SCHEDULE 14.3 Addresses for Notices
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EXHIBITS
EXHIBIT A Form of Note (Section 3.1)
EXHIBIT B Form of Compliance Certificate (Section 10.1.3)
EXHIBIT C Form of Guaranty (Section 1.1)
EXHIBIT D Form of Security Agreement (Section 1.1)
EXHIBIT E Form of Pledge Agreement (Section 1.1)
EXHIBIT F [intentionally omitted]
EXHIBIT G Form of Solvency Certificate (Section 11.1.15)
EXHIBIT H Form of Disbursement Letter (Section 11.1.19)
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CREDIT AGREEMENT
THIS CREDIT AGREEMENT dated as of April 26, 2000 (this "Agreement") is
entered into among XXXXX SYSTEMS GROUP, INC. (the "Company"), ASG Sub, Inc., a
wholly-owned subsidiary of the Company ("ASG"), the financial institutions that
are or may from time to time become parties hereto (together with their
respective successors and assigns, the "Banks"), LASALLE BANK NATIONAL
ASSOCIATION (in its individual capacity, "LaSalle"), as administrative agent for
the Banks, and KEYBANK NATIONAL ASSOCIATION (in its individual capacity,
"KeyBank"), as syndication agent for the Banks.
WHEREAS, the Banks have agreed to make available to the Company a
revolving credit facility (which includes letters of credit) upon the terms and
conditions set forth herein;
NOW, THEREFORE, in consideration of the mutual agreements herein
contained, the parties hereto agree as follows:
SECTION 1 DEFINITIONS.
1.1 Definitions. When used herein the following terms shall have
the following meanings:
Account Debtor means any Person who is obligated to the Company or any
Subsidiary under an Account Receivable.
Acquisition means any transaction or series of related transactions for
the purpose of or resulting, directly or indirectly, in (a) the acquisition of
all or substantially all of the assets of a Person, or of all or substantially
all of any business or division of a Person, (b) the acquisition of in excess of
50% of the capital stock, partnership interests, membership interests or equity
of any Person, or otherwise causing any Person to become a Subsidiary, or (c) a
merger or consolidation or any other combination with another Person (other than
a Person that is a Subsidiary).
Affected Loan - see Section 8.3.
Affiliate of any Person means (i) any other Person which, directly or
indirectly, controls or is controlled by or is under common control with such
Person and (ii) any officer or director of such Person. A Person shall be deemed
to be "controlled by" any other Person if such Person possesses, directly or
indirectly, power to vote 5% or more of the securities (on a fully diluted
basis) having ordinary voting power for the election of directors or managers or
power to direct or cause the direction of the management and policies of such
Person whether by contract or otherwise.
Agent means LaSalle in its capacity as administrative agent for the
Banks hereunder and any successor thereto in such capacity.
Agreement - see the Preamble.
Asset Sale means the sale, lease, assignment or other transfer for value
(each a "Disposition") by the Company or any Subsidiary to any Person (other
than the Company or any
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Subsidiary) of any asset or right of the company or such Subsidiary other than
(a) the Disposition of any asset which is to be replaced, and is in fact
replaced, within 120 days with another asset performing the same or a similar
function, (b) the sale or lease of inventory in the ordinary course of business
and (c) other Dispositions in any Fiscal Year the Net Proceeds of which do not
in the aggregate exceed $250,000.
Assignment Agreement - see Section 14.9.1.
Attorney Costs means, with respect to any Person, all reasonable fees
and charges of any counsel to such Person, and all court costs and similar legal
expenses.
Bank - see the Preamble. References to the "Banks" shall include the
Issuing Bank; for purposes of clarification only, to the extent that LaSalle (or
any successor Issuing Bank) may have any rights or obligations in addition to
those of the other Banks due to its status as Issuing Bank, its status as such
will be specifically referenced.
Base Rate means at any time the greater of (a) the Federal Funds Rate
plus 0.5% and (b) the Prime Rate.
Base Rate Loan means any Loan which bears interest at or by reference to
the Base Rate.
Base Rate Margin - see the Pricing Schedule.
Business Day means any day on which LaSalle is open for commercial
banking business in Chicago, Illinois and, in the case of a Business Day which
relates to a Eurodollar Loan, on which dealings are carried on in the London
interbank eurodollar market.
Capital Expenditures means all expenditures which, in accordance with
GAAP, would be required to be capitalized and shown on the consolidated balance
sheet of the Company, but excluding Acquisitions and expenditures made in
connection with the replacement, substitution or restoration of assets to the
extent financed (i) from insurance proceeds (or other similar recoveries) paid
on account of the loss of or damage to the assets being replaced or restored or
(ii) with awards of compensation arising from the taking by eminent domain or
condemnation of the assets being replaced.
Capital Lease means, with respect to any Person, any lease of (or other
agreement conveying the right to use) any real or personal property by such
Person that, in conformity with GAAP, is accounted for as a capital lease on the
balance sheet of such Person.
Cash Collateralize means to deliver cash collateral to the Agent, to be
held as cash collateral for outstanding Letters of Credit, pursuant to
documentation satisfactory to the Agent. Derivatives of such term have
corresponding meanings.
Cash Equivalent Investment means, at any time, (a) any evidence of Debt,
maturing not more than one year after such time, issued or guaranteed by the
United States Government or any agency thereof, (b) commercial paper, maturing
not more than one year from the date of issue, or corporate demand notes, in
each case (unless issued by a Bank or its holding company) rated at least A-l by
Standard & Poor's Ratings Group or P-l by Xxxxx'x Investors Service, Inc., (c)
any
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certificate of deposit (or time deposits represented by such certificates of
deposit) or banker's acceptance, maturing not more than one year after such
time, or overnight Federal Funds transactions that are issued or sold by any
Bank or its holding company or by a commercial banking institution that is a
member of the Federal Reserve System and has a combined capital and surplus and
undivided profits of not less than $500,000,000 and (d) any repurchase agreement
entered into with any Bank (or other commercial banking institution of the
stature referred to in clause (c)) which (i) is secured by a fully perfected
security interest in any obligation of the type described in any of clauses (a)
through (c) and (ii) has a market value at the time such repurchase agreement is
entered into of not less than 100% of the repurchase obligation of such Bank (or
other commercial banking institution) thereunder.
CERCLA - see Section 9.15.
Closing Date - see Section 11.1.
Code means the Internal Revenue Code of 1986.
Collateral Access Agreement means an agreement in form and substance
reasonably satisfactory to the Agent pursuant to which a mortgagee or lessor of
real property on which collateral is stored or otherwise located, or a
warehouseman, processor or other bailee of, acknowledges the Liens of the Agent
and waives any Liens held by such Person on such property, and, in the case of
any such agreement with a mortgagee or lessor, permits the Agent access to and
use of such real property for a reasonable amount of time following the
occurrence and during the continuance of an Event of Default to assemble,
complete and sell any collateral stored or otherwise located thereon.
Collateral Documents means the Security Agreement, each Mortgage, each
Pledge Agreement and any other agreement or instrument pursuant to which the
Company, any Subsidiary or any other Person grants collateral to the Agent for
the benefit of the Banks.
Commitment means, as to any Bank, such Bank's commitment to make Loans,
and to issue or participate in Letters of Credit, under this Agreement. The
initial amount of each Bank's Pro Rata Share of the Revolving Commitment Amount
is set forth on Schedule 2.1.
Company - see the Preamble.
Computation Period means each period of four consecutive Fiscal Quarters
ending on the last day of a Fiscal Quarter.
Consolidated Net Income means, with respect to the Company and its
Subsidiaries for any period, the net income (or loss) of the Company and its
Subsidiaries for such period, excluding any gains from Asset Sales, any
extraordinary gains or losses and any gains or losses from discontinued
operations. For purposes of calculation of the financial covenants set forth in
Section 10.6 in respect of any Computation Period, Consolidated Net Income shall
be deemed to include the net income for such period of any Subsidiary acquired
by the Company or any of its Subsidiaries during such period in accordance with
Section 10.11.
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Consolidated Net Worth means the total assets (valued at cost less
normal depreciation) of the Company and its Subsidiaries, less all Debt of the
Company and its Subsidiaries, all determined in accordance with GAAP.
Controlled Group means all members of a controlled group of corporations
and all members of a controlled group of trades or businesses (whether or not
incorporated) under common control which, together with the Company, are treated
as a single employer under Section 414 of the Code or Section 4001 of ERISA.
Debt of any Person means, without duplication, (a) all indebtedness of
such Person for borrowed money, whether or not evidenced by bonds, debentures,
notes or similar instruments, (b) all obligations of such Person as lessee under
Capital Leases which have been or should be recorded as liabilities on a balance
sheet of such Person in accordance with GAAP, (c) all obligations of such Person
to pay the deferred purchase price of property or services (including any
noncompete obligations or consulting agreements arising as a result of any
Acquisition and excluding trade accounts payable in the ordinary course of
business and contingent royalty payments), (d) all indebtedness secured by a
Lien on the property of such Person, whether or not such indebtedness shall have
been assumed by such Person, (e) all obligations, contingent or otherwise, with
respect to the face amount of all letters of credit (whether or not drawn) and
banker's acceptances issued for the account of such Person (including the
Letters of Credit), (f) all Hedging Obligations of such Person, (g) all
Suretyship Liabilities of such Person and (h) all Debt of any partnership of
which such Person is a general partner.
Debt to be Repaid means Debt listed on Schedule 11.1.
Designated Proceeds - see Section 6.2.2(a).
Disposal - see the definition of "Release".
Dollar and the sign "$" mean lawful money of the United States of
America.
EBITDA means, for any period, Consolidated Net Income for such period
plus, to the extent deducted in determining such Consolidated Net Income, income
taxes, Interest Expense, depreciation and amortization for such period. For
purposes of calculating the financial covenants set forth in Section 10.6,
EBITDA for the Fiscal Quarters ending September 30, 1999, December 31, 1999 and
March 31, 2000 shall be deemed to be $8,802,000, $13,789,000 and $10,556,000
respectively.
Environmental Claims means all claims, however asserted, by any
governmental, regulatory or judicial authority or other Person alleging
potential liability or responsibility for violation of any Environmental Law, or
for release or injury to the environment.
Environmental Laws means all present or future federal, state or local
laws, statutes, common law duties, rules, regulations, ordinances and codes,
together with all administrative orders, directed duties, requests, licenses,
authorizations and permits of, and agreements with, any governmental authority,
in each case relating to Environmental Matters.
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Environmental Matters means any matter arising out of or relating to
health and safety, or pollution or protection of the environment or workplace,
including any of the foregoing relating to the presence, use, production,
generation, handling, transport, treatment, storage, disposal, distribution,
discharge, release, control or cleanup of any Hazardous Substance.
ERISA means the Employee Retirement Income Security Act of 1974.
Eurocurrency Reserve Percentage means, with respect to any Eurodollar
Loan for any Interest Period, a percentage (expressed as a decimal) equal to the
daily average during such Interest Period of the percentage in effect on each
day of such Interest Period, as prescribed by the FRB, for determining the
aggregate maximum reserve requirements applicable to "Eurocurrency Liabilities"
pursuant to Regulation D or any other then applicable regulation of the FRB
which prescribes reserve requirements applicable to "Eurocurrency Liabilities"
as presently defined in Regulation D.
Eurodollar Loan means any Loan which bears interest at a rate determined
by reference to the Eurodollar Rate (Reserve Adjusted).
Eurodollar Margin - see the Pricing Schedule.
Eurodollar Office means with respect to any Bank the office or offices
of such Bank which shall be making or maintaining the Eurodollar Loans of such
Bank hereunder. A Eurodollar Office of any Bank may be, at the option of such
Bank, either a domestic or foreign office.
Eurodollar Rate means, with respect to any Eurodollar Loan for any
Interest Period, a rate per annum equal to the offered rate for deposits in
Dollars for a period equal or comparable to such Interest Period which appears
on Telerate page 3750 as of 11:00 A.M. (London time) two Business Days prior to
the first day of such Interest Period. "Telerate Page 3750 " means the display
designated as "Page 3750" on the Telerate Service (or such other page as may
replace page 3750 on that service or such other service as may be nominated by
the British Bankers' Association as the information vendor for the purpose of
displaying British Bankers' Association Interest Settlement Rates for Dollar
deposits).
Eurodollar Rate (Reserve Adjusted) means, with respect to any Eurodollar
Loan for any Interest Period, a rate per annum (rounded upwards, if necessary,
to the nearest 1/16th of 1%) determined pursuant to the following formula:
Eurodollar Rate = Eurodollar Rate
(Reserve Adjusted) 1-Eurocurrency
Reserve Percentage
Event of Default means any of the events described in Section 12.1.
Federal Funds Rate means, for any day, the rate set forth in the weekly
statistical release designated as H.15(519), or any successor publication,
published by the Federal Reserve Bank of New York (including any such successor
publication, "H.15(519)") on the preceding Business Day opposite the caption
"Federal Funds (Effective)"; or, if for any relevant day such rate is not
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so published on any such preceding Business Day, the rate for such day will be
the arithmetic mean as determined by the Agent of the rates for the last
transaction in overnight Federal funds arranged prior to 9:00 A.M. (New York
City time) on that day by each of three leading brokers of Federal funds
transactions in New York City selected by the Agent.
Fiscal Quarter means a fiscal quarter of a Fiscal Year.
Fiscal Year means the fiscal year of the Company and its Subsidiaries,
which period shall be the 12-month period ending on December 31 of each year.
References to a Fiscal Year with a number corresponding to any calendar year
(e.g., "Fiscal Year 1999") refer to the Fiscal Year ending on December 31 of
such calendar year.
Fixed Charge Coverage Ratio means, for any Computation Period, the ratio
of (a) the total for such period of EBITDA minus the sum of all software
development costs capitalized during such period, Tax Distributions paid by the
Company and its Subsidiaries and all Capital Expenditures to (b) the sum for
such period of (i) Interest Expense plus (ii) required payments of principal of
Funded Debt (excluding the Revolving Loans).
FRB means the Board of Governors of the Federal Reserve System or any
successor thereto.
Funded Debt means, as to any Person, all Debt of such Person.
GAAP means generally accepted accounting principles set forth from time
to time in the opinions and pronouncements of the Accounting Principles Board
and the American Institute of Certified Public Accountants and statements and
pronouncements of the Financial Accounting Standards Board (or agencies with
similar functions of comparable stature and authority within the U.S. accounting
profession), which are applicable to the circumstances as of the date of
determination.
Group - see Section 2.2.1.
Guaranty means a guaranty substantially in the form of Exhibit C.
Hazardous Substances - see Section 9.15.
Hedging Agreement means any interest rate, currency or commodity swap
agreement, cap agreement or collar agreement, and any other agreement or
arrangement designed to protect a Person against fluctuations in interest rates,
currency exchange rates or commodity prices.
Hedging Obligation means, with respect to any Person, any liability of
such Person under any Hedging Agreement.
Interest Expense means for any period the consolidated interest expense
of the Company and its Subsidiaries for such period (including all imputed
interest on Capital Leases). For purposes of calculating the financial covenants
set forth in Section 10.6, Interest Expense for the Fiscal Quarters ending
September 30, 1999, December 31, 1999 and March 31, 2000 shall be deemed to be
$2,037,000.
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Interest Period means, as to any Eurodollar Loan, the period commencing
on the date such Loan is borrowed or continued as, or converted into, a
Eurodollar Loan and ending on the date one, two, three or six months thereafter
as selected by the Company pursuant to Section 2.2.2 or 2.2.3, as the case may
be; provided that:
(i) if any Interest Period would otherwise end on a day that
is not a Business Day, such Interest Period shall be extended to the
following Business Day unless the result of such extension would be to
carry such Interest Period into another calendar month, in which event
such Interest Period shall end on the preceding Business Day;
(ii) any Interest Period that begins on a day for which there
is no numerically corresponding day in the calendar month at the end of
such Interest Period shall end on the last Business Day of the calendar
month at the end of such Interest Period; and
(iii) the Company may not select any Interest Period for a
Revolving Loan which would extend beyond the scheduled Termination Date.
Inventory has the meaning assigned to such term in the Uniform
Commercial Code as in effect in the State of Illinois on the date hereof.
Investment means, relative to any Person, any investment in another
Person, whether by acquisition of any debt or equity security, by making any
loan or advance or by becoming obligated with respect to a Suretyship Liability
in respect of obligations of such other Person (other than travel and similar
advances to employees in the ordinary course of business).
Issuing Bank means LaSalle in its capacity as the issuer of Letters of
Credit hereunder and its successors and assigns in such capacity.
LaSalle - see the Preamble.
L/C Application means, with respect to any request for the issuance of a
Letter of Credit, a letter of credit application in the form being used by the
Issuing Bank at the time of such request for the type of letter of credit
requested.
LC Fee Rate - see the Pricing Schedule.
Letter of Credit - see Section 2.1.2.
Lien means, with respect to any Person, any interest granted by such
Person in any real or personal property, asset or other right owned or being
purchased or acquired by such Person which secures payment or performance of any
obligation and shall include any mortgage, lien, encumbrance, charge or other
security interest of any kind, whether arising by contract, as a matter of law,
by judicial process or otherwise.
Loan Documents means this Agreement, the Notes, the Guaranty, the L/C
Applications and the Collateral Documents.
Loan Party means the Company and each Subsidiary, including ASG.
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Loans means Revolving Loans.
Mandatory Prepayment Event - see Section 6.2.2(a).
Margin Stock means any "margin stock" as defined in Regulation U.
Material Adverse Effect means (a) a material adverse change in, or a
material adverse effect upon, the financial condition, operations, assets,
business, properties or prospects of the Company and its Subsidiaries taken as a
whole, (b) a material impairment of the ability of the Company or any Subsidiary
to perform any of its obligations under any Loan Document or (c) a material
adverse effect upon any substantial portion of the collateral under the
Collateral Documents or upon the legality, validity, binding effect or
enforceability against the Company or any Subsidiary of any Loan Document.
Merger means the merger between ASG and Viasoft in accordance with the
terms and conditions set forth in the Merger Agreement.
Merger Agreement means the Agreement and Plan of Merger dated of even
date herewith by and among the Company, ASG and Viasoft.
Mortgage means a mortgage, deed of trust, leasehold mortgage or similar
instrument granting the Agent a Lien on real property of the Company or any
Subsidiary.
Multiemployer Pension Plan means a multiemployer plan, as defined in
Section 4001(a)(3) of ERISA, to which the Company or any member of the
Controlled Group may have any liability.
Net Cash Proceeds means:
(a) with respect to any Asset Sale the aggregate cash proceeds
(including cash proceeds received by way of deferred payment of
principal pursuant to a note, installment receivable or
otherwise, but only as and when received) received by the
Company or any Subsidiary pursuant to such Asset Sale net of (i)
the direct costs relating to such sale, transfer or other
disposition (including sales commissions and legal, accounting
and investment banking fees), (ii) taxes paid or reasonably
estimated by the Company to be payable as a result thereof
(after taking into account any available tax credits or
deductions and any tax sharing arrangements) and (iii) amounts
required to be applied to the repayment of any Debt secured by a
Lien on the asset subject to such Asset Sale (other than the
Loans); and
(b) with respect to any issuance of equity securities, the aggregate
cash proceeds received by the Company or any Subsidiary pursuant
to such issuance, net of the direct costs relating to such
issuance (including sales and underwriter's commission; and
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(c) with respect to any issuance of Debt, the aggregate cash
proceeds received by the Company or any Subsidiary pursuant to
such issuance, net of the direct costs of such issuance
(including up-front fees and placement fees).
Non-Use Fee Rate - see the Pricing Schedule.
Note - see Section 3.1.
Operating Lease means any lease of (or other agreement conveying the
right to use) any real or personal property by the Company or any Subsidiary, as
lessee, other than any Capital Lease or synthetic lease.
PBGC means the Pension Benefit Guaranty Corporation and any entity
succeeding to any or all of its functions under ERISA.
Pension Plan means a "pension plan", as such term is defined in Section
3(2) of ERISA, which is subject to Title IV of ERISA (other than a Multiemployer
Pension Plan), and to which the Company or any member of the Controlled Group
may have any liability, including any liability by reason of having been a
substantial employer within the meaning of Section 4063 of ERISA at any time
during the preceding five years, or by reason of being deemed to be a
contributing sponsor under Section 4069 of ERISA.
Person means any natural person, corporation, partnership, trust,
limited liability company, association, governmental authority or unit, or any
other entity, whether acting in an individual, fiduciary or other capacity.
Pledge Agreement means a pledge agreement in substantially the form of
Exhibit E.
Pro Rata Share means, with respect to any Bank, the percentage specified
opposite such Bank's name on Schedule 2.1 hereto, as adjusted from time to time
in accordance with the terms hereof.
Prime Rate means, for any day, the rate of interest in effect for such
day as publicly announced from time to time by LaSalle as its prime rate
(whether or not such rate is actually charged by LaSalle). Any change in the
Prime Rate announced by LaSalle shall take effect at the opening of business on
the day specified in the public announcement of such change.
RCRA - see Section 9.15.
Regulation D means Regulation D of the FRB.
Regulation U means Regulation U of the FRB.
Release has the meaning specified in CERCLA and the term "Disposal" (or
"Disposed") has the meaning specified in RCRA; provided that in the event either
CERCLA or RCRA is amended so as to broaden the meaning of any term defined
thereby, such broader meaning shall apply as of the effective date of such
amendment; and provided, further, that to the extent that the laws of a state
wherein any affected property lies establish a meaning for "Release" or
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"Disposal" which is broader than is specified in either CERCLA or RCRA, such
broader meaning shall apply.
Required Banks means Banks having Pro Rata Shares aggregating 662/3% or
more.
Responsible Officer means the Chief Executive Officer, Chief Financial
Officer or other responsible executive or financial officer of the Company.
Revolving Commitment Amount means $100,000,000, as reduced from time to
time pursuant to Section 6.1.
Revolving Loan - see Section 2.1.1.
Revolving Outstandings means, at any time, the sum of (a) the aggregate
principal amount of all outstanding Revolving Loans, plus (b) the Stated Amount
of all Letters of Credit.
SEC means the Securities and Exchange Commission or any other
governmental authority succeeding to any of the principal functions thereof.
Security Agreement means a security agreement substantially in the form
of Exhibit D.
Stated Amount means, with respect to any Letter of Credit at any date of
determination, (a) the maximum aggregate amount available for drawing thereunder
under any and all circumstances plus (b) the aggregate amount of all
unreimbursed payments and disbursements under such Letter of Credit.
Subordinated Debt means any unsecured Debt of the Company which has
subordination terms, covenants, pricing and other terms which have been approved
in writing by the Required Banks.
Subsidiary means, with respect to any Person, a corporation,
partnership, limited liability company or other entity of which such Person
and/or its other Subsidiaries own, directly or indirectly, such number of
outstanding shares or other ownership interests as have more than 50% of the
ordinary voting power for the election of directors or other managers of such
corporation, partnership, limited liability company or other entity. Unless the
context otherwise requires, each reference to Subsidiaries herein shall be a
reference to Subsidiaries of the Company.
Suretyship Liability means any agreement, undertaking or arrangement by
which any Person guarantees, endorses or otherwise becomes or is contingently
liable upon (by direct or indirect agreement, contingent or otherwise, to
provide funds for payment, to supply funds to or otherwise to invest in a
debtor, or otherwise to assure a creditor against loss) any indebtedness,
obligation or other liability of any other Person (other than by endorsements of
instruments in the course of collection), or guarantees the payment of dividends
or other distributions upon the shares of any other Person. The amount of any
Person's obligation in respect of any Suretyship Liability shall (subject to any
limitation set forth therein) be deemed to be the principal amount of the debt,
obligation or other liability supported thereby.
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Syndication Agent means KeyBank in its capacity as syndication agent for
the Banks hereunder and any successor thereto in such capacity.
Tax Distributions - see Section 10.10.
Tender Offer means the offer by ASG to purchase shares of Viasoft made
pursuant to the Merger Agreement.
Termination Date means the earlier to occur of (a) April 26, 2003 or (b)
such other date on which the Commitments terminate pursuant to Section 6 or 12;
provided that, upon the written request of the Company received by the Agent no
less than 60 days prior to April 26, 2003, the scheduled Termination Date may,
at the option of all of the Banks, be extended until April 26, 2004.
Total Debt means all Debt of the Company and its Subsidiaries,
determined on a consolidated basis, excluding (i) Hedging Obligations and (ii)
Debt of the Company to Subsidiaries and Debt of Subsidiaries to the Company or
to other Subsidiaries.
Total Debt to EBITDA Ratio means, as of the last day of any Fiscal
Quarter, the ratio of (i) Total Debt as of such day to (ii) EBITDA for the
Computation Period ending on such day.
Transaction Fees means fees and expenses incurred in connection with the
Tender Offer and the Merger, including, without limitation, investment banking
and advisory fees, legal and accounting fees, filing and proxy solicitation
fees, and fees payable under this Agreement.
Type of Loan or Borrowing - see Section 2.2.1. The types of Loans or
borrowings under this Agreement are as follows: Base Rate Loans or borrowings
and Eurodollar Loans or borrowings.
Unmatured Event of Default means any event that, if it continues
uncured, will, with lapse of time or notice or both, constitute an Event of
Default.
Viasoft means Viasoft, Inc., a Delaware corporation.
Wholly-Owned Subsidiary means, as to any Person, another Person all of
the shares of capital stock or other ownership interests of which (except
directors' qualifying shares) are at the time directly or indirectly owned by
such Person and/or another Wholly-Owned Subsidiary of such Person.
Year 2000 Problem means the risk that computer applications and embedded
microchips in non-computing devices may be unable to recognize and perform
properly date-sensitive functions involving certain dates prior to and any date
after December 31, 1999.
1.2 Other Interpretive Provisions. (a) The meanings of defined terms
are equally applicable to the singular and plural forms of the defined terms.
(b) Section, Schedule and Exhibit references are to this Agreement
unless otherwise specified.
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(c) The term "including" is not limiting and means "including
without limitation."
(d) In the computation of periods of time from a specified date to a
later specified date, the word "from" means "from and including"; the words "to"
and "until" each mean "to but excluding", and the word "through" means "to and
including."
(e) Unless otherwise expressly provided herein, (i) references to
agreements (including this Agreement) and other contractual instruments shall be
deemed to include all subsequent amendments and other modifications thereto, but
only to the extent such amendments and other modifications are not prohibited by
the terms of any Loan Document, and (ii) references to any statute or regulation
shall be construed as including all statutory and regulatory provisions
amending, replacing, supplementing or interpreting such statute or regulation.
(f) This Agreement and the other Loan Documents may use several
different limitations, tests or measurements to regulate the same or similar
matters. All such limitations, tests and measurements are cumulative and each
shall be performed in accordance with its terms.
(g) This Agreement and the other Loan Documents are the result of
negotiations among and have been reviewed by counsel to the Agent, the Company,
the Banks and the other parties thereto and are the products of all parties.
Accordingly, they shall not be construed against the Agent or the Banks merely
because of the Agent's or Banks' involvement in their preparation.
SECTION 2 COMMITMENTS OF THE BANKS; BORROWING, CONVERSION AND LETTER OF
CREDIT PROCEDURES.
2.1 Commitments. On and subject to the terms and conditions of this
Agreement, each of the Banks, severally and for itself alone, agrees to make
loans to, and to issue or participate in letters of credit for the account of,
the Company or ASG as follows:
2.1.1 Revolving Loan Commitment. Each Bank will make loans on a
revolving basis ("Revolving Loans") from time to time until the Termination Date
in such Bank's Pro Rata Share of such aggregate amounts as the Company may
request from all Banks; provided that the Revolving Outstandings will not at any
time exceed the Revolving Commitment Amount.
2.1.2 L/C Commitment. (a) The Issuing Bank will issue standby letters
of credit, in each case containing such terms and conditions as are permitted by
this Agreement and are reasonably satisfactory to the Issuing Bank (each a
"Letter of Credit"), at the request of and for the account of the Company from
time to time before the date which is 30 days prior to the Termination Date and
(b) as more fully set forth in Section 2.3.2, each Bank agrees to purchase a
participation in each such Letter of Credit; provided that (i) the aggregate
Stated Amount of all Letters of Credit shall not at any time exceed $5,000,000
and (ii) the Revolving Outstandings will not at any time exceed the Revolving
Commitment Amount.
2.2 Loan Procedures.
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2.2.1 Various Types of Loans. Each Revolving Loan shall be divided
into tranches which are, either a Base Rate Loan or a Eurodollar Loan (each a
"type" of Loan), as the Company shall specify in the related notice of borrowing
or conversion pursuant to Section 2.2.2 or 2.2.3. Eurodollar Loans having the
same Interest Period are sometimes called a "Group" or collectively "Groups".
Base Rate Loans and Eurodollar Loans may be outstanding at the same time,
provided that not more than five different Groups of Eurodollar Loans shall be
outstanding at any one time. All borrowings, conversions and repayments of
Revolving Loans shall be effected so that each Bank will have a pro rata share
(according to its Pro Rata Share) of all types and Groups of Loans.
Notwithstanding the foregoing or any other provision of this Agreement, the
Company may not select any Interest Period for a Eurodollar Loan which is longer
than one month prior to the earlier of (x) 90 days after the Closing Date and
(y) the date that the Agent notifies the Company that it has completed its
primary syndication of the Loans and the Commitments.
2.2.2 Borrowing Procedures. (a) The Company shall give written notice
or telephonic notice (followed immediately by written confirmation thereof) to
the Agent of each proposed borrowing not later than (a) in the case of a Base
Rate borrowing, 11:00 A.M., Chicago time, on the proposed date of such
borrowing, and (b) in the case of a Eurodollar borrowing, 11:00 A.M., Chicago
time, at least three Business Days prior to the proposed date of such borrowing.
Each such notice shall be effective upon receipt by the Agent, shall be
irrevocable, and shall specify the date, amount and type of borrowing and, in
the case of a Eurodollar borrowing, the initial Interest Period therefor.
Promptly upon receipt of such notice, the Agent shall advise each Bank thereof.
Not later than 1:00 P.M., Chicago time, on the date of a proposed borrowing,
each Bank shall provide the Agent at the office specified by the Agent with
immediately available funds covering such Bank's Pro Rata Share of such
borrowing and, so long as the Agent has not received written notice that the
conditions precedent set forth in Section 11 with respect to such borrowing have
not been satisfied, the Agent shall pay over the funds received by the Agent to
the Company on the requested borrowing date. Each borrowing shall be on a
Business Day. Each Base Rate borrowing shall be in an aggregate amount of at
least $500,000 and an integral multiple of $100,000, and each Eurodollar
borrowing shall be in an aggregate amount of at least $500,000 and an integral
multiple of at least $100,000.
(b) ASG hereby designates the Company as its representative and
agent on its behalf for the purposes of issuing notices of borrowing and
conversion notices, giving instructions with respect to the disbursement of
proceeds of the Loans, selecting interest rate options, giving and receiving all
other notices and consents hereunder or under any of the other Loan Documents
and taking all other actions (including in respect of compliance with covenants
and with respect to any agreement for any amendments, modifications, consents
and waivers regarding this Agreement or any other Loan Document) on behalf of
ASG under the Loan Documents. The Company hereby accepts such appointment. The
Agent and each Bank may regard any notice or other communication pursuant to any
Loan Document from the Company as a notice or communication from ASG, and may
give any notice or communication required to be given to ASG hereunder to the
Company on behalf of ASG. ASG agrees that each notice, election, representation,
warranty, covenant, agreement and undertaking made on its behalf by the Company
shall be deemed for all purposes to have been made by ASG and shall be binding
upon and enforceable against ASG to the same extent as if the same had been made
directly by ASG.
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2.2.3 Conversion and Continuation Procedures. (a) Subject to Section
2.2.1, the Company may, upon irrevocable written notice to the Agent in
accordance with clause (b) below:
(i) elect, as of any Business Day, to convert any Loans (or
any part thereof in an aggregate amount not less than $500,000 a higher
integral multiple of $100,000) into Loans of the other type; or
(ii) elect, as of the last day of the applicable Interest
Period, to continue any Eurodollar Loans having Interest Periods
expiring on such day (or any part thereof in an aggregate amount not
less than $500,000 or a higher integral multiple of $100,000) for a new
Interest Period;
provided that after giving effect to any prepayment, conversion or continuation,
the aggregate principal amount of each Group of Eurodollar Loans shall be at
least $500,000 and an integral multiple of $100,000. No conversion of any Base
Rate Loan to a Eurodollar Loan pursuant to Section 2.2.3(a)(i), or any
continuation of any Eurodollar Loan pursuant to Section 2.2.3(a)(ii), shall be
permitted so long as any Event of Default or Unmatured Event of Default exists.
(b) The Company shall give written or telephonic (followed
immediately by written confirmation thereof) notice to the Agent of each
proposed conversion or continuation not later than (i) in the case of conversion
into Base Rate Loans, 11:00 A.M., Chicago time, on the proposed date of such
conversion and (ii) in the case of conversion into or continuation of Eurodollar
Loans, 11:00 A.M., Chicago time, at least three Business Days prior to the
proposed date of such conversion or continuation, specifying in each case:
(i) the proposed date of conversion or continuation;
(ii) the aggregate amount of Loans to be converted or
continued;
(iii) the type of Loans resulting from the proposed conversion
or continuation; and
(iv) in the case of conversion into, or continuation of,
Eurodollar Loans, the duration of the requested Interest Period
therefor.
(c) If upon the expiration of any Interest Period applicable to
Eurodollar Loans, the Company has failed to select timely a new Interest Period
to be applicable to such Eurodollar Loans, the Company shall be deemed to have
elected to convert such Eurodollar Loans into Base Rate Loans effective on the
last day of such Interest Period.
(d) The Agent will promptly notify each Bank of its receipt of a
notice of conversion or continuation pursuant to this Section 2.2.3 or, if no
timely notice is provided by the Company, of the details of any automatic
conversion.
(e) Any conversion of a Eurodollar Loan on a day other than the last
day of an Interest Period therefor shall be subject to Section 8.4.
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2.3 Letter of Credit Procedures.
2.3.1 L/C Applications. The Company shall give notice to the Agent and
the Issuing Bank of the proposed issuance of each Letter of Credit on a Business
Day which is at least three Business Days (or such lesser number of days as the
Agent and the Issuing Bank shall agree in any particular instance in their sole
discretion) prior to the proposed date of issuance of such Letter of Credit.
Each such notice shall be accompanied by an L/C Application, duly executed by
the Company and in all respects satisfactory to the Agent and the Issuing Bank,
together with such other documentation as the Agent or the Issuing Bank may
request in support thereof, it being understood that each L/C Application shall
specify, among other things, the date on which the proposed Letter of Credit is
to be issued, the expiration date of such Letter of Credit (which shall not be
later than the earlier to occur of (x) one year after the date of issuance
thereof and (y) twenty-five days prior to the scheduled Termination Date,
provided that, subject to clause (y), any Letter of Credit with a one-year term
may provide for renewal thereof for additional one year periods), and whether
such Letter of Credit is to be transferable in whole or in part. So long as the
Issuing Bank has not received written notice that the conditions precedent set
forth in Section 11 with respect to the issuance of such Letter of Credit have
not been satisfied, the Issuing Bank shall issue such Letter of Credit on the
requested issuance date. The Issuing Bank shall promptly advise the Agent of the
issuance of each Letter of Credit and of any amendment thereto, extension
thereof or event or circumstance changing the amount available for drawing
thereunder. In the event of any inconsistency between the terms of any L/C
Application and the terms of this Agreement, the terms of this Agreement shall
control.
2.3.2 Participations in Letters of Credit. Concurrently with the
issuance of each Letter of Credit, the Issuing Bank shall be deemed to have sold
and transferred to each other Bank, and each other Bank shall be deemed
irrevocably and unconditionally to have purchased and received from the Issuing
Bank, without recourse or warranty, an undivided interest and participation, to
the extent of such other Bank's Pro Rata Share, in such Letter of Credit and the
Company's reimbursement obligations with respect thereto. For the purposes of
this Agreement, the unparticipated portion of each Letter of Credit shall be
deemed to be the Issuing Bank's "participation" therein. The Issuing Bank hereby
agrees, upon request of the Agent or any Bank, to deliver to the Agent or such
Bank a list of all outstanding Letters of Credit issued by the Issuing Bank,
together with such information related thereto as the Agent or such Bank may
reasonably request.
2.3.3 Reimbursement Obligations. The Company hereby unconditionally
and irrevocably agrees to reimburse the Issuing Bank for each payment or
disbursement made by the Issuing Bank under any Letter of Credit honoring any
demand for payment made by the beneficiary thereunder, in each case on the date
that such payment or disbursement is made. Any amount not reimbursed on the date
of such payment or disbursement shall bear interest from the date of such
payment or disbursement to the date that the Issuing Bank is reimbursed by the
Company therefor, payable on demand, at a rate per annum equal to the Base Rate
from time to time in effect plus the Base Rate Margin from time to time in
effect plus, beginning on the third Business Day after receipt of notice from
the Issuing Bank of such payment or disbursement, 2%. The Issuing Bank shall
notify the Company and the Agent whenever any demand for payment is made under
any Letter of Credit by the beneficiary thereunder; provided that the
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failure of the Issuing Bank to so notify the Company shall not affect the rights
of the Issuing Bank or the Banks in any manner whatsoever.
2.3.4 Limitation on Obligations of Issuing Bank. In determining
whether to pay under any Letter of Credit, the Issuing Bank shall not have any
obligation to the Company or any Bank other than to confirm that any documents
required to be delivered under such Letter of Credit appear to have been
delivered and appear to comply on their face with the requirements of such
Letter of Credit. Any action taken or omitted to be taken by the Issuing Bank
under or in connection with any Letter of Credit, if taken or omitted in the
absence of gross negligence and willful misconduct, shall not impose upon the
Issuing Bank any liability to the Company or any Bank and shall not reduce or
impair the Company's reimbursement obligations set forth in Section 2.3.3 or the
obligations of the Banks pursuant to Section 2.3.5.
2.3.5 Funding by Banks to Issuing Bank. If the Issuing Bank makes any
payment or disbursement under any Letter of Credit and the Company has not
reimbursed the Issuing Bank in full for such payment or disbursement by 11:00
A.M., Chicago time, on the date of such payment or disbursement, or if any
reimbursement received by the Issuing Bank from the Company is or must be
returned or rescinded upon or during any bankruptcy or reorganization of the
Company or otherwise, each other Bank shall be obligated to pay to the Agent for
the account of the Issuing Bank, in full or partial payment of the purchase
price of its participation in such Letter of Credit, its Pro Rata Share of such
payment or disbursement (but no such payment shall diminish the obligations of
the Company under Section 2.3.3), and, upon notice from the Issuing Bank, the
Agent shall promptly notify each other Bank thereof. Each other Bank irrevocably
and unconditionally agrees to so pay to the Agent in immediately available funds
for the Issuing Bank's account the amount of such other Bank's Percentage of
such payment or disbursement. If and to the extent any Bank shall not have made
such amount available to the Agent by 2:00 P.M., Chicago time, on the Business
Day on which such Bank receives notice from the Agent of such payment or
disbursement (it being understood that any such notice received after noon,
Chicago time, on any Business Day shall be deemed to have been received on the
next following Business Day), such Bank agrees to pay interest on such amount to
the Agent for the Issuing Bank's account forthwith on demand, for each day from
the date such amount was to have been delivered to the Agent to the date such
amount is paid, at a rate per annum equal to (a) for the first three days after
demand, the Federal Funds Rate from time to time in effect and (b) thereafter,
the Base Rate from time to time in effect. Any Bank's failure to make available
to the Agent its Pro Rata Share of any such payment or disbursement shall not
relieve any other Bank of its obligation hereunder to make available to the
Agent such other Bank's Pro Rata Share of such payment, but no Bank shall be
responsible for the failure of any other Bank to make available to the Agent
such other Bank's Pro Rata Share of any such payment or disbursement.
2.4 Commitments Several. The failure of any Bank to make a requested
Loan on any date shall not relieve any other Bank of its obligation (if any) to
make a Loan on such date, but no Bank shall be responsible for the failure of
any other Bank to make any Loan to be made by such other Bank.
2.5 Certain Conditions. Notwithstanding any other provision of this
Agreement, no Bank shall have an obligation to make any Loan, or to permit the
continuation of or any
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conversion into any Eurodollar Loan, and the Issuing Bank shall not have any
obligation to issue any Letter of Credit, if an Event of Default or Unmatured
Event of Default exists.
SECTION 3 NOTES EVIDENCING LOANS.
3.1 Notes. The Loans of each Bank shall be evidenced by a promissory
note (each a "Note") substantially in the form set forth in Exhibit A, with
appropriate insertions, payable to the order of such Bank in a face principal
amount equal to the sum of such Bank's Pro Rata Share of the Revolving
Commitment Amount and providing that the Revolving Loans of such Bank shall be
paid in full on the Termination Date.
3.2 Recordkeeping. Each Bank shall record in its records, or at its
option on the schedule attached to its Note, the date and amount of each Loan
made by such Bank, each repayment or conversion thereof and, in the case of each
Eurodollar Loan, the dates on which each Interest Period for such Loan shall
begin and end. The aggregate unpaid principal amount so recorded shall be
rebuttable presumptive evidence of the principal amount owing and unpaid on such
Note. The failure to so record any such amount or any error in so recording any
such amount shall not, however, limit or otherwise affect the obligations of the
Company or ASG hereunder or under any Note to repay the principal amount of the
Loans evidenced by such Note together with all interest accruing thereon.
SECTION 4 INTEREST.
4.1 Interest Rates. Each of the Company and ASG promises to pay on a
joint and several basis interest on the unpaid principal amount of each Loan for
the period commencing on the date of such Loan until such Loan is paid in full
as follows:
(a) at all times while such Loan is a Base Rate Loan, at a rate per
annum equal to the sum of the Base Rate from time to time in effect plus the
Base Rate Margin from time to time in effect; and
(b) at all times while such Loan is a Eurodollar Loan, at a rate per
annum equal to the sum of the Eurodollar Rate (Reserve Adjusted) applicable to
each Interest Period for such Loan plus the Eurodollar Margin from time to time
in effect;
provided that at any time an Event of Default exists, if requested by the
Required Banks, the interest rate applicable to each Loan shall be increased by
2%.
4.2 Interest Payment Dates. Accrued interest on each Base Rate Loan
shall be payable in arrears on the last day of each calendar quarter and at
maturity. Accrued interest on each Eurodollar Loan shall be payable on the last
day of each Interest Period relating to such Loan (and, in the case of a
Eurodollar Loan with a six-month Interest Period, on the three-month anniversary
of the first day of such Interest Period) and at maturity. After maturity,
accrued interest on all Loans shall be payable on demand.
4.3 Setting and Notice of Eurodollar Rates. The applicable
Eurodollar Rate for each Interest Period shall be determined by the Agent, and
notice thereof shall be given by the Agent promptly to the Company and each
Bank. Each determination of the applicable Eurodollar Rate
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by the Agent shall be conclusive and binding upon the parties hereto, in the
absence of demonstrable error. The Agent shall, upon written request of the
Company or any Bank, deliver to the Company or such Bank a statement showing the
computations used by the Agent in determining any applicable Eurodollar Rate
hereunder.
4.4 Computation of Interest. Interest shall be computed for the
actual number of days elapsed on the basis of a year of 360 days. The applicable
interest rate for each Base Rate Loan shall change simultaneously with each
change in the Base Rate.
SECTION 5 FEES.
5.1 Non-Use Fee. Each of the Company and ASG agrees to pay on a
joint and several basis to the Agent for the account of each Bank a non-use fee,
for the period from the Closing Date to the Termination Date, at the Non-Use Fee
Rate in effect from time to time of such Bank's Pro Rata Share (as adjusted from
time to time) of the unused amount of the Revolving Commitment Amount. For
purposes of calculating usage under this Section, the Revolving Commitment
Amount shall be deemed used to the extent of the aggregate principal amount of
all outstanding Revolving Loans plus the Stated Amount of all Letters of Credit.
Such non-use fee shall be payable in arrears on the last day of each calendar
quarter and on the Termination Date for any period then ending for which such
non-use fee shall not have previously been paid. The non-use fee shall be
computed for the actual number of days elapsed on the basis of a year of 360
days.
5.2 Letter of Credit Fees. (a) Each of the Company and ASG agrees to
pay on a joint and several basis to the Agent for the account of each Bank a
letter of credit fee for each Letter of Credit equal to the LC Fee Rate in
effect from time to time of such Bank's Pro Rata Share (as adjusted from time to
time) of the undrawn amount of such Letter of Credit (computed for the actual
number of days elapsed on the basis of a year of 360 days); provided that, if
requested by the Required Banks, the rate applicable to each Letter of Credit
shall be increased by 2% at any time that an Event of Default exists. Such
letter of credit fee shall be payable in arrears on the last day of each
calendar quarter and on the Termination Date (or such later date on which such
Letter of Credit expires or is terminated) for the period from the date of the
issuance of each Letter of Credit (or the last day on which the letter of credit
fee was paid with respect thereto) to the date such payment is due or, if
earlier, the date on which such Letter of Credit expired or was terminated.
(b) In addition, with respect to each Letter of Credit, the Company
agrees to pay to the Issuing Bank, for its own account, (i) such fees and
expenses as the Issuing Bank customarily requires in connection with the
issuance, negotiation, processing and/or administration of letters of credit in
similar situations and (ii) a letter of credit fronting fee in the amount of 25
basis points at the times agreed to by the Company and the Issuing Bank.
5.3 Upfront Fees. The Company agrees to pay to the Agent for the
account of each Bank on the Closing Date an upfront fee in the amount previously
agreed to between the Company and the Agent (and the Agent agrees to promptly
forward to each Bank a portion of such upfront fee in the amount previously
agreed to between the Agent and such Bank).
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5.4 Agent's Fees. Each of the Company and ASG agrees to pay on a
joint and several basis to the Agent and the Syndication Agent such fees as are
set forth in the Fee Letter among the Company, the Agent and the Syndication
Agent dated April 12, 2000, and such other fees as are mutually agreed from time
to time.
SECTION 6 REDUCTION OR TERMINATION OF THE REVOLVING COMMITMENT AMOUNT;
PREPAYMENTS.
6.1 Reduction or Termination of the Revolving Commitment Amount.
6.1.1 Voluntary Reduction or Termination of the Revolving Commitment
Amount. The Company may from time to time on at least five Business Days' prior
written notice received by the Agent (which shall promptly advise each Bank
thereof) permanently reduce the Revolving Commitment Amount to an amount not
less than the Revolving Outstandings. Any such reduction shall be in an amount
not less than $500,000 or a higher integral multiple of $100,000. Concurrently
with any reduction of the Revolving Commitment Amount to zero, the Company shall
pay all interest on the Revolving Loans, all commitment fees and all letter of
credit fees and shall Cash Collateralize in full all obligations arising with
respect to the Letters of Credit.
6.1.2 Mandatory Reductions of Revolving Commitment Amount. (a) The
Revolving Commitment Amount shall be reduced on the following dates by an amount
equal to the amount set forth opposite such date.
Date Reduction Amount
---- ----------------
June 30, 2001 2,500,000
September 30, 2001 2,500,000
December 31, 2001 2,500,000
March 31, 2002 2,500,000
June 30, 2002 5,000,000
September 30, 2002 5,000,000
December 31, 2002 5,000,000
March 31, 2003 5,000,000
(b) On the date of any Mandatory Prepayment Event, the Revolving
Commitment Amount shall be permanently reduced by an amount (if any) equal to
the Designated Proceeds of such Mandatory Prepayment Event.
6.1.3 All Reductions of the Revolving Commitment Amount. All
reductions of the Revolving Commitment Amount shall reduce the Commitments pro
rata among the Banks according to their respective Pro Rata Shares.
6.2 Prepayments.
6.2.1 Voluntary Prepayments. The Company may from time to time prepay
the Loans in whole or in part; provided that the Company shall give the Agent
(which shall promptly advise each Bank) notice thereof not later than 11:00
A.M., Chicago time, on the day of such prepayment (which shall be a Business
Day), specifying the Loans to be prepaid and the date and
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amount of prepayment. Any such partial prepayment shall be in an amount equal to
$100,000 or a higher integral multiple of $100,000.
6.2.2 Mandatory Prepayments. (a) The Company shall make a prepayment
of the Loans upon the occurrence of any of the following (each a "Mandatory
Prepayment Event") at the following times and in the following amounts (such
applicable amounts being referred to as "Designated Proceeds"):
(i) Concurrently with the receipt by the Company or any
Subsidiary of any Net Cash Proceeds from any Asset Sale, in an amount
equal to 100% of such Net Cash Proceeds.
(ii) Concurrently with the receipt by the Company or any
Subsidiary of any Net Cash Proceeds from any issuance of equity
securities of the Company or any Subsidiary (excluding (x) any issuance
of shares of capital stock pursuant to any employee or director stock
option program, benefit plan or compensation program, (y) any issuance
by a Subsidiary to the Company or another Subsidiary and, (z) equity
issued to Xxxxxx Xxxxx in connection with the transactions contemplated
by this Agreement and adjusted for Tax Distributions made in accordance
with Section 10.10, in an amount equal to 100% of such Net Cash
Proceeds.
(iii) Concurrently with the receipt by the Company or any
Subsidiary of any Net Cash Proceeds from any issuance of any Debt of the
Company or any Subsidiary (excluding Debt permitted by clauses (a)
through (i) of Section 10.7), in an amount equal to 100% of such Net
Cash Proceeds.
(b) If on any day on which the Revolving Commitment Amount is
reduced pursuant to Section 6.1.2 the Revolving Outstandings exceed the
Revolving Commitment Amount, the Company shall immediately prepay Revolving
Loans or Cash Collateralize the outstanding Letters of Credit, or do a
combination of the foregoing, in an amount sufficient to eliminate such excess.
6.3 All Prepayments. Each voluntary partial prepayment shall be in a
principal amount of $100,000 or a higher integral multiple of $100,000. Any
partial prepayment of a Group of Eurodollar Loans shall be subject to the
proviso to Section 2.2.3(a). Any prepayment of a Eurodollar Loan on a day other
than the last day of an Interest Period therefor shall include interest on the
principal amount being repaid and shall be subject to Section 8.4.
SECTION 7 MAKING AND PRORATION OF PAYMENTS; SETOFF; TAXES.
7.1 Making of Payments. All payments of principal of or interest on
the Notes, and of all fees, shall be made by the Company to the Agent in
immediately available funds at the office specified by the Agent not later than
noon, Chicago time, on the date due; and funds received after that hour shall be
deemed to have been received by the Agent on the following Business Day. The
Agent shall promptly remit to each Bank its share of all such payments received
in collected funds by the Agent for the account of such Bank. All payments under
Section 8.1 shall be made by the Company directly to the Bank entitled thereto.
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7.2 Application of Certain Payments. Each payment of principal shall
be applied to such Loans as the Company shall direct by notice to be received by
the Agent on or before the date of such payment or, in the absence of such
notice, as the Agent shall determine in its discretion. Concurrently with each
remittance to any Bank of its share of any such payment, the Agent shall advise
such Bank as to the application of such payment.
7.3 Due Date Extension. If any payment of principal or interest with
respect to any of the Loans, or of any fees, falls due on a day which is not a
Business Day, then such due date shall be extended to the immediately following
Business Day (unless, in the case of a Eurodollar Loan, such immediately
following Business Day is the first Business Day of a calendar month, in which
case such due date shall be the immediately preceding Business Day) and, in the
case of principal, additional interest shall accrue and be payable for the
period of any such extension.
7.4 Setoff. The Company agrees that the Agent and each Bank have all
rights of set-off and bankers' lien provided by applicable law, and in addition
thereto, the Company agrees that at any time any Event of Default exists, the
Agent and each Bank may apply to the payment of any obligations of the Company
or ASG hereunder, whether or not then due, any and all balances, credits,
deposits, accounts or moneys of the Company or ASG then or thereafter with the
Agent or such Bank.
7.5 Proration of Payments. If any Bank shall obtain any payment or
other recovery (whether voluntary, involuntary, by application of offset or
otherwise, but excluding any payment pursuant to Section 8.7 or 14.9 and
payments of interest on any Affected Loan) on account of principal of or
interest on any Loan (or on account of its participation in any Letter of
Credit) in excess of its pro rata share of payments and other recoveries
obtained by all Banks on account of principal of and interest on the Loans (or
such participation) then held by them, such Bank shall purchase from the other
Banks such participations in the Loans (or sub-participations in Letters of
Credit) held by them as shall be necessary to cause such purchasing Bank to
share the excess payment or other recovery ratably with each of them; provided
that if all or any portion of the excess payment or other recovery is thereafter
recovered from such purchasing Bank, the purchase shall be rescinded and the
purchase price restored to the extent of such recovery.
7.6 Taxes. All payments of principal of, and interest on, the Loans
and all other amounts payable hereunder shall be made free and clear of and
without deduction for any present or future income, excise, stamp or franchise
taxes and other taxes, fees, duties, withholdings or other charges of any nature
whatsoever imposed by any taxing authority, excluding franchise taxes and taxes
imposed on or measured by any Bank's net income or receipts (all non-excluded
items being called "Taxes"). If any withholding or deduction from any payment to
be made by the Company hereunder is required in respect of any Taxes pursuant to
any applicable law, rule or regulation, then the Company will:
(a) pay directly to the relevant authority the full amount
required to be so withheld or deducted;
(b) promptly forward to the Agent an official receipt or
other documentation satisfactory to the Agent evidencing such payment to
such authority; and
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(c) pay to the Agent for the account of the Banks such
additional amount or amounts as is necessary to ensure that the net
amount actually received by each Bank will equal the full amount such
Bank would have received had no such withholding or deduction been
required.
Moreover, if any Taxes are directly asserted against the Agent or any Bank with
respect to any payment received by the Agent or such Bank hereunder, the Agent
or such Bank may pay such Taxes and the Company will promptly pay such
additional amounts (including any penalty, interest or expense) as is necessary
in order that the net amount received by such Person after the payment of such
Taxes (including any Taxes on such additional amount) shall equal the amount
such Person would have received had such Taxes not been asserted.
If the Company fails to pay any Taxes when due to the appropriate taxing
authority or fails to remit to the Agent, for the account of the respective
Banks, the required receipts or other required documentary evidence, the Company
shall indemnify the Banks for any incremental Taxes, interest or penalties that
may become payable by any Bank as a result of any such failure. For purposes of
this Section 7.6, a distribution hereunder by the Agent or any Bank to or for
the account of any Bank shall be deemed a payment by the Company.
Each Bank that (a) is organized under the laws of a jurisdiction other
than the United States of America and (b)(i) is a party hereto on the Closing
Date or (ii) becomes an assignee of an interest under this Agreement under
Section 14.9.1 after the Closing Date (unless such Bank was already a Bank
hereunder immediately prior to such assignment) shall execute and deliver to the
Company and the Agent one or more (as the Company or the Agent may reasonably
request) United States Internal Revenue Service Forms 4224 or Forms 1001 or such
other forms or documents, appropriately completed, as may be applicable to
establish that such Bank is exempt from withholding or deduction of Taxes. The
Company shall not be required to pay additional amounts to any Bank pursuant to
this Section 7.6 to the extent that the obligation to pay such additional
amounts would not have arisen but for the failure of such Bank to comply with
this paragraph.
SECTION 8 INCREASED COSTS; SPECIAL PROVISIONS FOR EURODOLLAR LOANS.
8.1 Increased Costs. (a) If, after the date hereof, the adoption of,
or any change in, any applicable law, rule or regulation, or any change in the
interpretation or administration of any applicable law, rule or regulation by
any governmental authority, central bank or comparable agency charged with the
interpretation or administration thereof, or compliance by any Bank (or any
Eurodollar Office of such Bank) with any request or directive (whether or not
having the force of law) of any such authority, central bank or comparable
agency
(i) shall subject any Bank (or any Eurodollar Office of such
Bank) to any tax, duty or other charge with respect to its Eurodollar
Loans, its Note or its obligation to make Eurodollar Loans, or shall
change the basis of taxation of payments to any Bank of the principal of
or interest on its Eurodollar Loans or any other amounts due under this
Agreement in respect of its Eurodollar Loans or its obligation to make
Eurodollar Loans (except for changes in the rate of tax on the overall
net income of such Bank or its
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Eurodollar Office imposed by the jurisdiction in which such Bank's
principal executive office or Eurodollar Office is located);
(ii) shall impose, modify or deem applicable any reserve
(including any reserve imposed by the FRB, but excluding any reserve
included in the determination of interest rates pursuant to Section 4),
special deposit or similar requirement against assets of, deposits with
or for the account of, or credit extended by any Bank (or any Eurodollar
Office of such Bank); or
(iii) shall impose on any Bank (or its Eurodollar Office) any
other condition affecting its Eurodollar Loans, its Note or its
obligation to make Eurodollar Loans;
and the result of any of the foregoing is to increase the cost to (or to impose
a cost on) such Bank (or any Eurodollar Office of such Bank) of making or
maintaining any Eurodollar Loan, or to reduce the amount of any sum received or
receivable by such Bank (or its Eurodollar Office) under this Agreement or under
its Note with respect thereto, then upon demand by such Bank (which demand shall
be accompanied by a statement setting forth the basis for such demand and a
calculation of the amount thereof in reasonable detail, a copy of which shall be
furnished to the Agent), the Company shall pay directly to such Bank such
additional amount as will compensate such Bank for such increased cost or such
reduction.
(b) If any Bank shall reasonably determine that any change in, the
adoption or phase-in of, any applicable law, rule or regulation regarding
capital adequacy, or any change in the interpretation or administration thereof
by any governmental authority, central bank or comparable agency charged with
the interpretation or administration thereof, or compliance by any Bank or any
Person controlling such Bank with any request or directive regarding capital
adequacy (whether or not having the force of law) of any such authority, central
bank or comparable agency, has or would have the effect of reducing the rate of
return on such Bank's or such controlling Person's capital as a consequence of
such Bank's obligations hereunder or under any Letter of Credit to a level below
that which such Bank or such controlling Person could have achieved but for such
change, adoption, phase-in or compliance (taking into consideration such Bank's
or such controlling Person's policies with respect to capital adequacy) by an
amount deemed by such Bank or such controlling Person to be material, then from
time to time, upon demand by such Bank (which demand shall be accompanied by a
statement setting forth the basis for such demand and a calculation of the
amount thereof in reasonable detail, a copy of which shall be furnished to the
Agent), the Company shall pay to such Bank such additional amount as will
compensate such Bank or such controlling Person for such reduction.
8.2 Basis for Determining Interest Rate Inadequate or Unfair. If
with respect to any Interest Period:
(a) deposits in Dollars (in the applicable amounts) are not
being offered to the Agent in the interbank eurodollar market for such
Interest Period, or the Agent otherwise reasonably determines (which
determination shall be binding and conclusive on the Company) that by
reason of circumstances affecting the interbank eurodollar market
adequate and reasonable means do not exist for ascertaining the
applicable Eurodollar Rate; or
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(b) Banks having aggregate Pro Rata Shares of 40% or more
advise the Agent that the Eurodollar Rate (Reserve Adjusted) as
determined by the Agent will not adequately and fairly reflect the cost
to such Banks of maintaining or funding Eurodollar Loans for such
Interest Period (taking into account any amount to which such Banks may
be entitled under Section 8.1) or that the making or funding of
Eurodollar Loans has become impracticable as a result of an event
occurring after the date of this Agreement which in the opinion of such
Banks materially affects such Loans;
then the Agent shall promptly notify the other parties thereof and, so long as
such circumstances shall continue, (i) no Bank shall be under any obligation to
make or convert into Eurodollar Loans and (ii) on the last day of the current
Interest Period for each Eurodollar Loan, such Loan shall, unless then repaid in
full, automatically convert to a Base Rate Loan.
8.3 Changes in Law Rendering Eurodollar Loans Unlawful. If any
change in, or the adoption of any new, law or regulation, or any change in the
interpretation of any applicable law or regulation by any governmental or other
regulatory body charged with the administration thereof, should make it (or in
the good faith judgment of any Bank cause a substantial question as to whether
it is) unlawful for any Bank to make, maintain or fund Eurodollar Loans, then
such Bank shall promptly notify each of the other parties hereto and, so long as
such circumstances shall continue, (a) such Bank shall have no obligation to
make or convert into Eurodollar Loans (but shall make Base Rate Loans
concurrently with the making of or conversion into Eurodollar Loans by the Banks
which are not so affected, in each case in an amount equal to the amount of
Eurodollar Loans which would be made or converted into by such Bank at such time
in the absence of such circumstances) and (b) on the last day of the current
Interest Period for each Eurodollar Loan of such Bank (or, in any event, on such
earlier date as may be required by the relevant law, regulation or
interpretation), such Eurodollar Loan shall, unless then repaid in full,
automatically convert to a Base Rate Loan. Each Base Rate Loan made by a Bank
which, but for the circumstances described in the foregoing sentence, would be a
Eurodollar Loan (an "Affected Loan") shall remain outstanding for the same
period as the Group of Eurodollar Loans of which such Affected Loan would be a
part absent such circumstances.
8.4 Funding Losses. The Company hereby agrees that upon demand by
any Bank (which demand shall be accompanied by a statement setting forth the
basis for the amount being claimed, a copy of which shall be furnished to the
Agent), the Company will indemnify such Bank against any net loss or expense
which such Bank may sustain or incur (including any net loss or expense incurred
by reason of the liquidation or reemployment of deposits or other funds acquired
by such Bank to fund or maintain any Eurodollar Loan), as reasonably determined
by such Bank, as a result of (a) any payment, prepayment or conversion of any
Eurodollar Loan of such Bank on a date other than the last day of an Interest
Period for such Loan (including any conversion pursuant to Section 8.3) or (b)
any failure of the Company to borrow, convert or continue any Loan on a date
specified therefor in a notice of borrowing, conversion or continuation pursuant
to this Agreement. For this purpose, all notices to the Agent pursuant to this
Agreement shall be deemed to be irrevocable.
8.5 Right of Banks to Fund through Other Offices. Each Bank may, if
it so elects, fulfill its commitment as to any Eurodollar Loan by causing a
foreign branch or Affiliate of such Bank to make such Loan; provided that in
such event for the purposes of this Agreement such
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Loan shall be deemed to have been made by such Bank and the obligation of the
Company to repay such Loan shall nevertheless be to such Bank and shall be
deemed held by it, to the extent of such Loan, for the account of such branch or
Affiliate.
8.6 Discretion of Banks as to Manner of Funding. Notwithstanding any
provision of this Agreement to the contrary, each Bank shall be entitled to fund
and maintain its funding of all or any part of its Loans in any manner it sees
fit, it being understood, however, that for the purposes of this Agreement all
determinations hereunder shall be made as if such Bank had actually funded and
maintained each Eurodollar Loan during each Interest Period for such Loan
through the purchase of deposits having a maturity corresponding to such
Interest Period and bearing an interest rate equal to the Eurodollar Rate for
such Interest Period.
8.7 Mitigation of Circumstances; Replacement of Banks
(a) Each Bank shall promptly notify the Company and the Agent of any
event of which it has knowledge which will result in, and will use reasonable
commercial efforts available to it (and not, in such Bank's sole judgment,
otherwise disadvantageous to such Bank) to mitigate or avoid, (i) any obligation
by the Company to pay any amount pursuant to Section 7.6 or 8.1 or (ii) the
occurrence of any circumstances described in Section 8.2 or 8.3 (and, if any
Bank has given notice of any such event described in clause (i) or (ii) above
and thereafter such event ceases to exist, such Bank shall promptly so notify
the Company and the Agent). Without limiting the foregoing, each Bank will
designate a different funding office if such designation will avoid (or reduce
the cost to the Company of) any event described in clause (i) or (ii) of the
preceding sentence and such designation will not, in such Bank's sole judgment,
be otherwise disadvantageous to such Bank.
(b) If the Company becomes obligated to pay additional amounts to
any Bank pursuant to Section 7.6 or 8.1, or any Bank gives notice of the
occurrence of any circumstances described in Section 8.2 or 8.3, the Company may
designate another bank which is acceptable to the Agent and the Issuing Bank in
their reasonable discretion (such other bank being called a "Replacement Bank")
to purchase the Loans of such Bank and such Bank's rights hereunder, without
recourse to or warranty by, or expense to, such Bank, for a purchase price equal
to the outstanding principal amount of the Loans payable to such Bank plus any
accrued but unpaid interest on such Loans and all accrued but unpaid fees owed
to such Bank and any other amounts payable to such Bank under this Agreement,
and to assume all the obligations of such Bank hereunder, and, upon such
purchase and assumption (pursuant to an Assignment Agreement), such Bank shall
no longer be a party hereto or have any rights hereunder (other than rights with
respect to indemnities and similar rights applicable to such Bank prior to the
date of such purchase and assumption) and shall be relieved from all obligations
to the Company hereunder, and the Replacement Bank shall succeed to the rights
and obligations of such Bank hereunder.
8.8 Conclusiveness of Statements; Survival of Provisions.
Determinations and statements of any Bank pursuant to Section 8.1, 8.2, 8.3 or
8.4 shall be conclusive absent demonstrable error. Banks may use reasonable
averaging and attribution methods in determining compensation under Sections 8.1
and 8.4, and the provisions of such Sections shall survive repayment of the
Loans, cancellation of the Notes, expiration or termination of the Letters of
Credit and termination of this Agreement.
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SECTION 9 WARRANTIES.
To induce the Agent and the Banks to enter into this Agreement and to
induce the Banks to make Loans and issue and participate in Letters of Credit
hereunder, each of the Company and ASG warrant, jointly and severally, to the
Agent and the Banks that:
9.1 Organization. The Company is a corporation validly existing and
in good standing under the laws of the State of Delaware; each Subsidiary is
validly existing and in good standing under the laws of the jurisdiction of its
organization; and each of the Company and each Subsidiary is duly qualified to
do business in each jurisdiction where, because of the nature of its activities
or properties, such qualification is required, except for such jurisdictions
where the failure to so qualify would not have a Material Adverse Effect.
9.2 Authorization; No Conflict. Each of the Company and each other
Loan Party is duly authorized to execute and deliver each Loan Document to which
it is a party, each of the Company and ASG is duly authorized to borrow monies
hereunder and each of the Company and each other Loan Party is duly authorized
to perform its obligations under each Loan Document to which it is a party. The
execution, delivery and performance by the Company and ASG of this Agreement and
by each of the Company and each other Loan Party of each Loan Document to which
it is a party, and the borrowings by the Company and ASG hereunder, do not and
will not (a) require any consent or approval of any governmental agency or
authority (other than any consent or approval which has been obtained and is in
full force and effect), (b) conflict with (i) any provision of law, (ii) the
charter, by-laws or other organizational documents of the Company or any other
Loan Party or (iii) any agreement, indenture, instrument or other document, or
any judgment, order or decree, which is binding upon the Company or any other
Loan Party or any of their respective properties or (c) require, or result in,
the creation or imposition of any Lien on any asset of the Company, any
Subsidiary or any other Loan Party (other than Liens in favor of the Agent
created pursuant to the Collateral Documents).
9.3 Validity and Binding Nature. Each of this Agreement and each
other Loan Document to which the Company and ASG or any other Loan Party is a
party is the legal, valid and binding obligation of such Person, enforceable
against such Person in accordance with its terms, subject to bankruptcy,
insolvency and similar laws affecting the enforceability of creditors' rights
generally and to general principles of equity.
9.4 Financial Condition. The audited consolidated financial
statements of the Company and its Subsidiaries as at December 31, 1997, December
31, 1998 and December 31, 1999 and the unaudited consolidated financial
statements of the Company and the Subsidiaries as at March 31, 2000, copies of
each of which have been delivered to each Bank, were prepared in accordance with
GAAP (subject, in the case of such unaudited statements, to the absence of
footnotes and to normal year-end adjustments) and present fairly the
consolidated financial condition of the Company and its Subsidiaries as at such
dates and the results of their operations for the periods then ended.
9.5 No Material Adverse Change. Since December 31, 1999, there has
been no material adverse change in the financial condition, operations, assets,
business, properties or prospects of the Company and its Subsidiaries taken as a
whole.
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9.6 Litigation and Contingent Liabilities. No litigation (including
derivative actions), arbitration proceeding or governmental investigation or
proceeding is pending or, to the Company's knowledge, threatened against the
Company or any Subsidiary which might reasonably be expected to have a Material
Adverse Effect, except as set forth in Schedule 9.6. Other than any liability
incident to such litigation or proceedings, neither the Company nor any
Subsidiary has any material contingent liabilities not listed on Schedule 9.6 or
permitted by Section 10.7.
9.7 Ownership of Properties; Liens. Each of the Company and each
Subsidiary owns good and, in the case of real property, marketable title to all
of its properties and assets, real and personal, tangible and intangible, of any
nature whatsoever (including patents, trademarks, trade names, service marks and
copyrights), free and clear of all Liens, charges and claims (including
infringement claims with respect to patents, trademarks, service marks,
copyrights and the like) except as permitted by Section 10.8.
9.8 Subsidiaries. As of the Closing Date, the Company has no
Subsidiaries other than those listed on Schedule 9.8.
9.9 Pension Plans. (a) During the twelve-consecutive-month period
prior to the date of the execution and delivery of this Agreement or the making
of any Loan or the issuance of any Letter of Credit, (i) no steps have been
taken to terminate any Pension Plan and (ii) no contribution failure has
occurred with respect to any Pension Plan sufficient to give rise to a Lien
under Section 302(f) of ERISA. No condition exists or event or transaction has
occurred with respect to any Pension Plan which could result in the incurrence
by the Company of any material liability, fine or penalty.
(b) All contributions (if any) have been made to any Multiemployer
Pension Plan that are required to be made by the Company or any other member of
the Controlled Group under the terms of the plan or of any collective bargaining
agreement or by applicable law; neither the Company nor any member of the
Controlled Group has withdrawn or partially withdrawn from any Multiemployer
Pension Plan, incurred any withdrawal liability with respect to any such plan or
received notice of any claim or demand for withdrawal liability or partial
withdrawal liability from any such plan, and no condition has occurred which, if
continued, might result in a withdrawal or partial withdrawal from any such
plan; and neither the Company nor any member of the Controlled Group has
received any notice that any Multiemployer Pension Plan is in reorganization,
that increased contributions may be required to avoid a reduction in plan
benefits or the imposition of any excise tax, that any such plan is or has been
funded at a rate less than that required under Section 412 of the Code, that any
such plan is or may be terminated, or that any such plan is or may become
insolvent.
9.10 Investment Company Act. Neither the Company nor any Subsidiary
is an "investment company" or a company "controlled" by an "investment company",
within the meaning of the Investment Company Act of 1940.
9.11 Public Utility Holding Company Act. Neither the Company nor any
Subsidiary is a "holding company", or a "subsidiary company" of a "holding
company", or an "affiliate" of a
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"holding company" or of a "subsidiary company" of a "holding company", within
the meaning of the Public Utility Holding Company Act of 1935.
9.12 Regulation U. The Company is not engaged principally, or as one
of its important activities, in the business of extending credit for the purpose
of purchasing or carrying Margin Stock. No proceeds of any Loan will be used to
purchase or carry any Margin Stock or to extend credit to others for the purpose
of purchasing or carrying any Margin Stock (other than in connection with the
Tender Offer and the Merger and, in such event, in compliance with Regulation
U).
9.13 Taxes. Each of the Company and each Subsidiary has filed all tax
returns and reports required by law to have been filed by it and has paid all
taxes and governmental charges thereby shown to be owing, except any such taxes
or charges which are being diligently contested in good faith by appropriate
proceedings and for which adequate reserves in accordance with GAAP shall have
been set aside on its books.
9.14 Solvency, etc. On the Closing Date, and immediately prior to and
after giving effect to the issuance of each Letter of Credit and each borrowing
hereunder and the use of the proceeds thereof, (a) each of the Company's and
each other Loan Party's assets will exceed its liabilities and (b) each of the
Company and each other Loan Party will be solvent, will be able to pay its debts
as they mature, will own property with fair saleable value greater than the
amount required to pay its debts and will have capital sufficient to carry on
its business as then constituted.
9.15 Environmental Matters.
(a) No Violations. Except as set forth on Schedule 9.15, neither the
Company nor any Subsidiary, nor any operator of the Company's or any
Subsidiary's properties, is in violation, or alleged violation, of any judgment,
decree, order, law, permit, license, rule or regulation pertaining to
environmental matters, including those arising under the Resource Conservation
and Recovery Act ("RCRA"), the Comprehensive Environmental Response,
Compensation and Liability Act of 1980 ("CERCLA"), the Superfund Amendments and
Reauthorization Act of 1986 or any other Environmental Law which (i) in any
single case, requires expenditures in any three-year period of $100,000 or more
by the Company and its Subsidiaries in penalties and/or for investigative,
removal or remedial actions or (ii) individually or in the aggregate otherwise
might reasonably be expected to have a Material Adverse Effect.
(b) Notices. Except as set forth on Schedule 9.15 and for matters
arising after the Closing Date, in each case none of which could singly or in
the aggregate be expected to have a Material Adverse Effect, neither the Company
nor any Subsidiary has received notice from any third party, including any
Federal, state or local governmental authority: (a) that any one of them has
been identified by the U.S. Environmental Protection Agency as a potentially
responsible party under CERCLA with respect to a site listed on the National
Priorities List, 40 C.F.R. Part 000 Xxxxxxxx X; (b) that any hazardous waste, as
defined by 42 U.S.C. Section 6903(5), any hazardous substance as defined by 42
U.S.C. Section 9601(14), any pollutant or contaminant as defined by 42 U.S.C.
Section 9601(33) or any toxic substance, oil or hazardous material or other
chemical or substance regulated by any Environmental Law (all of the foregoing,
"Hazardous Substances")
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which any one of them has generated, transported or disposed of has been found
at any site at which a Federal, state or local agency or other third party has
conducted a remedial investigation, removal or other response action pursuant to
any Environmental Law; (c) that the Company or any Subsidiary must conduct a
remedial investigation, removal, response action or other activity pursuant to
any Environmental Law; or (d) of any Environmental Claim.
(c) Handling of Hazardous Substances. Except as set forth on
Schedule 9.15, (i) no portion of the real property or other assets of the
Company or any Subsidiary has been used for the handling, processing, storage or
disposal of Hazardous Substances except in accordance in all material respects
with applicable Environmental Laws; and no underground tank or other underground
storage receptacle for Hazardous Substances is located on such properties; (ii)
in the course of any activities conducted by the Company, any Subsidiary or the
operators of any real property of the Company or any Subsidiary, no Hazardous
Substances have been generated or are being used on such properties except in
accordance in all material respects with applicable Environmental Laws; (iii)
there have been no Releases or threatened Releases of Hazardous Substances on,
upon, into or from any real property or other assets of the Company or any
Subsidiary, which Releases singly or in the aggregate might reasonably be
expected to have a material adverse effect on the value of such real property or
assets; (iv) there have been no Releases on, upon, from or into any real
property in the vicinity of the real property or other assets of the Company or
any Subsidiary which, through soil or groundwater contamination, may have come
to be located on, and which might reasonably be expected to have a material
adverse effect on the value of, the real property or other assets of the Company
or any Subsidiary; and (v) any Hazardous Substances generated by the Company and
its Subsidiaries have been transported offsite only by properly licensed
carriers and delivered only to treatment or disposal facilities maintaining
valid permits as required under applicable Environmental Laws, which
transporters and facilities have been and are operating in compliance in all
material respects with such permits and applicable Environmental Laws.
9.16 Year 2000 Problem. The Company and its Subsidiaries (a) have
reviewed the areas within their business and operations which could be adversely
affected by, and have developed or are developing a program to address on a
timely basis, the Year 2000 Problem and (b) have made appropriate inquiries as
to the effect the Year 2000 Problem will have on their material suppliers and
customers. Based on such review, program and inquiries, the Company reasonably
believes that the "Year 2000 Problem" will not have a Material Adverse Effect.
9.17 Insurance. Set forth on Schedule 9.17 is a complete and accurate
summary of the property and casualty insurance program of the Company and its
Subsidiaries as of the Closing Date (including the names of all insurers, policy
numbers, expiration dates, amounts and types of coverage, annual premiums,
exclusions, deductibles, self-insured retention, and a description in reasonable
detail of any self-insurance program, retrospective rating plan, fronting
arrangement or other risk assumption arrangement involving the Company or any
Subsidiary).
9.18 Real Property. Set forth on Schedule 9.18 is a complete and
accurate list, as of the Closing Date, of the address of all real property owned
or leased by the Company or any Subsidiary, together with, in the case of leased
property, the name and mailing address of the lessor of such property.
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9.19 Information. All information heretofore or contemporaneously
herewith furnished in writing by the Company or any other Loan Party to the
Agent or any Bank for purposes of or in connection with this Agreement and the
transactions contemplated hereby is, and all written information hereafter
furnished by or on behalf of the Company or any Subsidiary to the Agent or any
Bank pursuant hereto or in connection herewith will be, true and accurate in
every material respect on the date as of which such information is dated or
certified, and none of such information is or will be incomplete by omitting to
state any material fact necessary to make such information not misleading in
light of the circumstances under which made (it being recognized by the Agent
and the Banks that any projections and forecasts provided by the Company are
based on good faith estimates and assumptions believed by the Company to be
reasonable as of the date of the applicable projections or assumptions and that
actual results during the period or periods covered by any such projections and
forecasts may differ from projected or forecasted results).
9.20 Intellectual Property. The Company and each Subsidiary owns and
possesses or has a license or other right to use all patents, patent rights,
trademarks, trademark rights, trade names, trade name rights, service marks,
service xxxx rights and copyrights as are necessary for the conduct of the
business of the Company and its Subsidiaries, without any infringement upon
rights of others which could reasonably be expected to have a Material Adverse
Effect.
9.21 Burdensome Obligations. Neither the Company nor any Subsidiary
is a party to any agreement or contract or subject to any corporate or
partnership restriction which might reasonably be expected to have a Material
Adverse Effect.
9.22 Labor Matters. Except as set forth on Schedule 9.22, neither the
Company nor any Subsidiary is subject to any labor or collective bargaining
agreement. There are no existing or threatened strikes, lockouts or other labor
disputes involving the Company or any Subsidiary that singly or in the aggregate
could reasonably be expected to have a Material Adverse Effect. Hours worked by
and payment made to employees of the Company and its Subsidiaries are not in
violation of the Fair Labor Standards Act or any other applicable law, rule or
regulation dealing with such matters.
9.23 No Default. No Event of Default or Unmatured Event of Default
exists or would result from the incurring by the Company of any Debt hereunder
or under any other Loan Document.
9.24 Merger Agreement, etc. (a) The Company has heretofore furnished
the Agent a true and correct copy of the Merger Agreement.
(b) Each of the Company and ASG and, to the Company's knowledge,
each other party to the Merger Agreement, has duly taken all necessary
corporate, partnership or other organizational action to authorize the
execution, delivery and performance of the Merger Agreement and the consummation
of transactions contemplated thereby.
(c) The Merger will comply with all applicable legal requirements,
and all necessary governmental, regulatory, creditor, shareholder, partner and
other material consents, approvals and exemptions required to be obtained by the
Company and, to the Company's knowledge, each
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other party to the Merger Agreement in connection with the Merger will be, prior
to consummation of the Merger, duly obtained and will be in full force and
effect. As of the date of the Merger, all applicable waiting periods with
respect to the Merger will have expired without any action being taken by any
competent governmental authority which restrains, prevents or imposes material
adverse conditions upon the consummation of the Merger.
(d) The execution and delivery of the Merger Agreement did not, and
the consummation of the Merger will not, violate any statute or regulation of
the United States (including any securities law) or of any state or other
applicable jurisdiction, or any order, judgment or decree of any court or
governmental body binding on the Company or, to the Company's knowledge, any
other party to the Merger Agreement, or result in a breach of, or constitute a
default under, any material agreement, indenture, instrument or other document,
or any judgment, order or decree, to which the Company is a party or by which
the Company is bound or, to the Company's knowledge, to which any other party to
the Merger Agreement is a party or by which any such party is bound.
(e) No statement or representation made in the Merger Agreement by
the Company or ASG or, to the best knowledge of a Responsible Officer of the
Company, any other Person, contains any untrue statement of a material fact or
omits to state any material fact required to be stated therein or necessary in
order to make the statements made therein, in light of the circumstances under
which they are made, not misleading.
SECTION 10 COVENANTS.
Until the expiration or termination of the Commitments and thereafter
until all obligations of the Company hereunder and under the other Loan
Documents are paid in full and all Letters of Credit have been terminated, the
Company agrees that, unless at any time the Required Banks shall otherwise
expressly consent in writing, it will:
10.1 Reports, Certificates and Other Information. Furnish to the
Agent and each Bank:
10.1.1 Annual Report. Promptly when available and in any event within
120 days after the close of each Fiscal Year: (a) a copy of the annual audit
report of the Company and its Subsidiaries for such Fiscal Year, including
therein consolidated balance sheets and statements of earnings and cash flows of
the Company and its Subsidiaries as at the end of such Fiscal Year, certified
without qualification by PriceWaterhouseCoopers or other independent auditors of
recognized standing selected by the Company and reasonably acceptable to the
Required Banks, together with (i) a written statement from such accountants to
the effect that in making the examination necessary for the signing of such
annual audit report by such accountants, nothing came to their attention that
caused them to believe that the Company was not in compliance with any provision
of Section 10.6, 10.7, 10.9 or 10.10 of this Agreement insofar as such provision
relates to accounting matters or, if something has come to their attention that
caused them to believe that the Company was not in compliance with any such
provision, describing such non-compliance in reasonable detail and (ii) a
comparison with the budget for such Fiscal Year and a comparison with the
previous Fiscal Year; and (b) consolidating balance sheets of the Company and
its Subsidiaries as of the end of such Fiscal Year and a consolidating statement
of earnings
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for the Company and its Subsidiaries for such Fiscal Year, certified by a
Responsible Officer of the Company.
10.1.2 Interim Reports. (a) Promptly when available and in any event
within 30 days after the end of each Fiscal Quarter (except the last Fiscal
Quarter of each Fiscal Year), consolidated and consolidating balance sheets of
the Company and its Subsidiaries as of the end of such Fiscal Quarter, together
with consolidated and consolidating statements of earnings and cash flows for
such Fiscal Quarter and for the period beginning with the first day of such
Fiscal Year and ending on the last day of such Fiscal Quarter, together with a
comparison with the corresponding period of the previous Fiscal Year and a
comparison with the budget for such period of the current Fiscal Year, certified
by a Responsible Officer of the Company; and (b) promptly when available and in
any event within 30 days after the end of each month (except the last month of
each Fiscal Quarter), consolidated and consolidating balance sheets of the
Company and its Subsidiaries as of the end of such month, together with
consolidated and consolidating statements of earnings and a consolidated
statement of cash flows for such month and for the period beginning with the
first day of such Fiscal Year and ending on the last day of such month, together
with a comparison with the corresponding period of the previous Fiscal Year and
a comparison with the budget for such period of the current Fiscal Year,
certified by a Responsible Officer of the Company.
10.1.3 Compliance Certificates. Contemporaneously with the furnishing
of a copy of each annual audit report pursuant to Section 10.1.1 and each set of
quarterly statements pursuant to Section 10.1.2, a duly completed compliance
certificate in the form of Exhibit B, with appropriate insertions, dated the
date of such annual report or such quarterly statements and signed by a
Responsible Officer of the Company, containing (i) a computation of each of the
financial ratios and restrictions set forth in Section 10.6 and to the effect
that such officer has not become aware of any Event of Default or Unmatured
Event of Default that has occurred and is continuing or, if there is any such
event, describing it and the steps, if any, being taken to cure it and (ii) a
written statement of the Company's management setting forth a discussion of the
Company's financial condition, changes in financial condition and results of
operations.
10.1.4 Reports to the SEC and to Shareholders. Promptly upon the filing
or sending thereof, copies of all regular, periodic or special reports of the
Company or any Subsidiary filed with the SEC; copies of all registration
statements of the Company or any Subsidiary filed with the SEC (other than on
Form S-8); and copies of all proxy statements or other communications made to
security holders generally.
10.1.5 Notice of Default, Litigation and ERISA Matters. Promptly upon
becoming aware of any of the following, written notice describing the same and
the steps being taken by the Company or the Subsidiary affected thereby with
respect thereto:
(a) the occurrence of an Event of Default or an Unmatured
Event of Default;
(b) any litigation, arbitration or governmental
investigation or proceeding not previously disclosed by the Company to
the Banks which has been instituted or, to the knowledge of the Company,
is threatened against the Company or any Subsidiary or to
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which any of the properties of any thereof is subject which might
reasonably be expected to have a Material Adverse Effect;
(c) the institution of any steps by any member of the
Controlled Group or any other Person to terminate any Pension Plan, or
the failure of any member of the Controlled Group to make a required
contribution to any Pension Plan (if such failure is sufficient to give
rise to a Lien under Section 302(f) of ERISA) or to any Multiemployer
Pension Plan, or the taking of any action with respect to a Pension Plan
which could result in the requirement that the Company furnish a bond or
other security to the PBGC or such Pension Plan, or the occurrence of
any event with respect to any Pension Plan or Multiemployer Pension Plan
which could result in the incurrence by any member of the Controlled
Group of any material liability, fine or penalty (including any claim or
demand for withdrawal liability or partial withdrawal from any
Multiemployer Pension Plan), or any material increase in the contingent
liability of the Company with respect to any post-retirement welfare
plan benefit, or any notice that any Multiemployer Pension Plan is in
reorganization, that increased contributions may be required to avoid a
reduction in plan benefits or the imposition of an excise tax, that any
such plan is or has been funded at a rate less than that required under
Section 412 of the Code, that any such plan is or may be terminated, or
that any such plan is or may become insolvent;
(d) any cancellation or material change in any insurance
maintained by the Company or any Subsidiary; or
(e) any other event (including (i) any violation of any
Environmental Law or the assertion of any Environmental Claim or (ii)
the enactment or effectiveness of any law, rule or regulation) which
might reasonably be expected to have a Material Adverse Effect.
10.1.6 Management Reports. Promptly upon the request of the Agent or
any Bank, copies of all detailed financial and management reports submitted to
the Company by independent auditors in connection with each annual or interim
audit made by such auditors of the books of the Company.
10.1.7 Projections. As soon as practicable, and in any event within 30
days prior to the commencement of each Fiscal Year, financial projections for
the Company and its Subsidiaries for such Fiscal Year (including an operating
budget and a cash flow budget) prepared in a manner consistent with the
projections delivered by the Company to the Banks prior to the Closing Date or
otherwise in a manner reasonably satisfactory to the Agent, accompanied by a
certificate of a Responsible Officer of the Company on behalf of the Company to
the effect that (i) such projections were prepared by the Company in good faith,
(ii) the Company has a reasonable basis for the assumptions contained in such
projections and (iii) such projections have been prepared in accordance with
such assumptions.
10.1.8 Subordinated Debt Notices. Promptly from time to time, copies of
any notices (including notices of default or acceleration) received from any
holder or trustee of, under or with respect to any Subordinated Debt.
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10.1.9 Year 2000 Problem. Promptly upon the request of the Agent or any
Bank, such updated information or documentation as may be requested from time to
time regarding the efforts of the Company and its Subsidiaries to address the
Year 2000 Problem.
10.1.10 Other Information. Promptly from time to time, such other
information concerning the Company and its Subsidiaries as any Bank or the Agent
may reasonably request.
10.2 Books, Records and Inspections. Keep, and cause each Subsidiary
to keep, its books and records in accordance with sound business practices
sufficient to allow the preparation of financial statements in accordance with
GAAP; permit, and cause each Subsidiary to permit, any Bank or the Agent or any
representative thereof to inspect the properties and operations of the Company
or such Subsidiary; and permit, and cause each Subsidiary to permit, at any
reasonable time and with reasonable notice (or at any time without notice if an
Event of Default exists), any Bank or the Agent or any representative thereof to
visit any or all of its offices, to discuss its financial matters with its
officers and its independent auditors (and the Company hereby authorizes such
independent auditors to discuss such financial matters with any Bank or the
Agent or any representative thereof), and to examine (and, at the expense of the
Company or the applicable Subsidiary, photocopy extracts from) any of its books
or other records; and permit, and cause each Subsidiary to permit, the Agent and
its representatives to inspect the Inventory and other tangible assets of the
Company or such Subsidiary, to perform appraisals of the equipment of the
Company or such Subsidiary, and to inspect, audit, check and make copies of and
extracts from the books, records, computer data, computer programs, journals,
orders, receipts, correspondence and other data relating to Inventory, Accounts
Receivable and any other collateral. All such inspections or audits by the Agent
shall be at the Company's expense.
10.3 Maintenance of Property; Insurance. (a) Keep, and cause each
Subsidiary to keep, all property useful and necessary in the business of the
Company or such Subsidiary in good working order and condition, ordinary wear
and tear excepted.
(b) Maintain, and cause each Subsidiary to maintain, with
responsible insurance companies, such insurance as may be required by any law or
governmental regulation or court decree or order applicable to it and such other
insurance, to such extent and against such hazards and liabilities, as is
customarily maintained by companies similarly situated, but which shall insure
against all risks and liabilities of the type identified on Schedule 9.17 and
shall have insured amounts no less than, and deductibles no higher than, those
set forth on such schedule; and, upon request of the Agent or any Bank, furnish
to the Agent or such Bank a certificate setting forth in reasonable detail the
nature and extent of all insurance maintained by the Company and its
Subsidiaries. The Company shall cause each issuer of an insurance policy to
provide the Agent with an endorsement (i) showing loss payable to the Agent with
respect to each policy of property or casualty insurance and naming the Agent
and each Bank as an additional insured with respect to each policy of insurance
for liability for personal injury or property damage, (ii) providing that 30
days' notice will be given to the Agent prior to any cancellation of, material
reduction or change in coverage provided by or other material modification to
such policy and (iii) reasonably acceptable in all other respects to the Agent.
The Company shall execute and deliver to the Agent a collateral assignment, in
form and substance satisfactory to the Agent, of each business interruption
insurance policy maintained by the Company.
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(c) UNLESS THE COMPANY PROVIDES THE AGENT WITH EVIDENCE OF THE
INSURANCE COVERAGE REQUIRED BY THIS AGREEMENT, THE AGENT MAY PURCHASE INSURANCE
AT THE COMPANY'S EXPENSE TO PROTECT THE AGENT'S AND THE BANKS' INTERESTS IN THE
COLLATERAL. THIS INSURANCE MAY, BUT NEED NOT, PROTECT THE COMPANY'S INTERESTS.
THE COVERAGE THAT THE AGENT PURCHASES MAY NOT PAY ANY CLAIM THAT IS MADE AGAINST
THE COMPANY IN CONNECTION WITH THE COLLATERAL. THE COMPANY MAY LATER CANCEL ANY
INSURANCE PURCHASED BY THE AGENT, BUT ONLY AFTER PROVIDING THE AGENT WITH
EVIDENCE THAT THE COMPANY HAS OBTAINED INSURANCE AS REQUIRED BY THIS AGREEMENT.
IF THE AGENT PURCHASES INSURANCE FOR THE COLLATERAL, THE COMPANY WILL BE
RESPONSIBLE FOR THE COSTS OF THAT INSURANCE, INCLUDING INTEREST AND ANY OTHER
CHARGES THAT MAY BE IMPOSED WITH THE PLACEMENT OF THE INSURANCE, UNTIL THE
EFFECTIVE DATE OF THE CANCELLATION OR EXPIRATION OF THE INSURANCE. THE COSTS OF
THE INSURANCE MAY BE ADDED TO THE PRINCIPAL AMOUNT OF THE LOANS OWING HEREUNDER.
THE COSTS OF THE INSURANCE MAY BE MORE THAN THE COST OF THE INSURANCE THE
COMPANY MAY BE ABLE TO OBTAIN ON ITS OWN.
10.4 Compliance with Laws; Payment of Taxes and Liabilities. (a)
Comply, and cause each Subsidiary to comply, in all material respects with all
applicable laws, rules, regulations, decrees, orders, judgments, licenses and
permits, except where failure to comply could not reasonably be expected to have
a Material Adverse Effect; and (b) pay, and cause each Subsidiary to pay, prior
to delinquency, all taxes and other governmental charges against it or any of
its property, as well as claims of any kind which, if unpaid, might become a
Lien on any of its property; provided that the foregoing shall not require the
Company or any Subsidiary to pay any such tax or charge so long as it shall
contest the validity thereof in good faith by appropriate proceedings and shall
set aside on its books adequate reserves with respect thereto in accordance with
GAAP.
10.5 Maintenance of Existence, etc. Maintain and preserve, and
(subject to Section 10.11) cause each Subsidiary to maintain and preserve, (a)
its existence and good standing in the jurisdiction of its organization and (b)
its qualification to do business and good standing in each jurisdiction where
the nature of its business makes such qualification necessary (except in those
instances in which the failure to be qualified or in good standing does not have
a Material Adverse Effect).
10.6 Financial Covenants.
10.6.1 Fixed Charge Coverage Ratio. Not permit the Fixed Charge
Coverage Ratio as of the last day of any Computation Period to be less than
1.25.
10.6.2 Total Debt to EBITDA Ratio. Not permit the Total Debt to EBITDA
Ratio as of the last day of any Computation Period to exceed the applicable
ratio set forth below for such Computation Period:
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COMPUTATION PERIOD ENDING TOTAL DEBT TO EBITDA RATIO
------------------------- --------------------------
June 30, 2000 2.60
September 30, 2000 2.60
December 31, 2000 2.50
March 31, 2001 2.30
June 30, 2001 2.10
September 30, 2001 1.90
December 31, 2001 1.65
March 31, 2002 1.50
June 30, 2002 1.25
September 30, 2002 1.25
December 31, 2002 1.25
March 31, 2003 and thereafter 1.25
10.6.3 EBITDA. Not permit EBITDA for any Computation Period to be less
than the applicable amount set forth below for such Computation Period:
COMPUTATION PERIOD ENDING EBITDA
------------------------- ------
June 30, 2000 $39,400,000
September 30, 2000 $38,500,000
December 31, 2000 $37,000,000
March 31, 2001 $36,000,000
June 30, 2001 $36,500,000
September 30, 2001 $37,000,000
December 31, 2001 $38,000,000
March 31, 2002 $38,750,000
June 30, 2002 $39,000,000
September 30, 2002 $40,000,000
December 31, 2002 $41,000,000
March 31, 2003 and thereafter $42,000,000
10.6.4 Minimum Consolidated Net Worth. Not permit the Consolidated Net
Worth of the Company as of the last day of any Computation Period to be less
than the sum of (i) $11,459,936 (Consolidated Net Worth as of December 31,
1999), plus (ii) 50% of the cumulative positive Consolidated Net Income.
10.6.5 Maximum Capital Expenditures. Not permit the aggregate amount of
all Capital Expenditures made by the Company and its Subsidiaries to exceed the
following amounts in the corresponding Fiscal Years.
FISCAL YEAR CAPITAL EXPENDITURES LIMIT
----------- --------------------------
2000 $2,000,000
2001 $1,750,000
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2002 and thereafter $1,750,000
provided that if Capital Expenditures are less than the amount set forth above
for any Fiscal Year, the excess (up to $750,000) may be carried over and
expended in the following Fiscal Year; provided further, that in such following
Fiscal Year the first dollars expended for Capital Expenditures shall be counted
against the limitations set forth above and then against the carry-over amount.
10.7 Limitations on Debt. Not, and not permit any Subsidiary to,
create, incur, assume or suffer to exist any Debt, except:
(a) obligations under this Agreement and the other Loan
Documents;
(b) Debt secured by Liens permitted by Section 10.8(d), and
extensions, renewals and refinancings thereof; provided that the
aggregate amount of all such Debt at any time outstanding shall not
exceed $1,300,000, $1,400,000 or $1,500,000 during the Fiscal Years
ending December 31, 2000, December 31, 2001 and December 31, 2002 and
thereafter, respectively, plus, in each case, an amount equal to all
such Debt assumed by the Company or any Subsidiary in connection with
any Acquisition made in accordance with Section 10.11;
(c) Debt of Subsidiaries to the Company or to a Wholly-Owned
Subsidiary;
(d) unsecured Debt of the Company to Subsidiaries;
(e) Subordinated Debt;
(f) Hedging Obligations incurred for bona fide hedging
purposes and not for speculation;
(g) Debt described on Schedule 10.7 and any extension,
renewal or refinancing thereof so long as the principal amount thereof
is not increased;
(h) the Debt to be Repaid (so long as such Debt is repaid on
the Closing Date with the proceeds of the initial Loans hereunder); and
(i) other Debt, in addition to the Debt listed above, in an
aggregate amount not at any time exceeding $100,000.
10.8 Liens. Not, and not permit any Subsidiary to, create or permit
to exist any Lien on any of its real or personal properties, assets or rights of
whatsoever nature (whether now owned or hereafter acquired), except:
(a) Liens for taxes or other governmental charges not at the
time delinquent or thereafter payable without penalty or being contested
in good faith by appropriate proceedings and, in each case, for which it
maintains adequate reserves;
(b) Liens arising in the ordinary course of business (such
as (i) Liens of carriers, warehousemen, mechanics and materialmen and
other similar Liens imposed by
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law and (ii) Liens incurred in connection with worker's compensation,
unemployment compensation and other types of social security (excluding
Liens arising under ERISA) or in connection with surety bonds, bids,
performance bonds and similar obligations) for sums not overdue or being
contested in good faith by appropriate proceedings and not involving any
deposits or advances or borrowed money or the deferred purchase price of
property or services and, in each case, for which it maintains adequate
reserves;
(c) Liens described on Schedule 10.8;
(d) subject to the limitation set forth in Section 10.7(b),
(i) Liens arising in connection with Capital Leases (and attaching only
to the property being leased), (ii) Liens existing on property at the
time of the acquisition thereof by the Company or any Subsidiary (and
not created in contemplation of such acquisition) and (iii) Liens that
constitute purchase money security interests on any property securing
debt incurred for the purpose of financing all or any part of the cost
of acquiring such property, provided that any such Lien attaches to such
property within 60 days of the acquisition thereof and attaches solely
to the property so acquired;
(e) attachments, appeal bonds, judgments and other similar
Liens, for sums not exceeding $100,000 arising in connection with court
proceedings, provided the execution or other enforcement of such Liens
is effectively stayed and the claims secured thereby are being actively
contested in good faith and by appropriate proceedings;
(f) easements, rights of way, restrictions, minor defects or
irregularities in title and other similar Liens not interfering in any
material respect with the ordinary conduct of the business of the
Company or any Subsidiary;
(g) Liens arising under the Loan Documents; and
(h) the replacement, extension or renewal of any Lien
permitted by clause (c) above upon or in the same property theretofore
subject thereto arising out of the extension, renewal or replacement of
the Debt secured thereby (without increase in the amount thereof).
10.9 Operating Leases. Not permit the aggregate amount of all rental
payments under Operating Leases made (or scheduled to be made) by the Company
and its Subsidiaries (on a consolidated basis) to exceed $6,500,000, $7,000,000
or $7,500,000 for the Fiscal Years ending December 31, 2000, December 31, 2001
and December 31, 2002 and thereafter, respectively, plus, in each case, an
amount equal to all rental payments made (or scheduled to be made) under
Operating Leases assumed by the Company or any of its Subsidiaries in connection
with any Acquisition made in accordance with Section 10.11.
10.10 Restricted Payments. Not, and not permit any Subsidiary to, (a)
make any distribution to any of its shareholders, (b) purchase or redeem any of
its capital stock or other equity interests or any warrants, options or other
rights in respect thereof, (c) pay any management fees or similar fees to any of
its shareholders or any Affiliate thereof, (d) make any redemption, prepayment,
defeasance or repurchase of any Subordinated Debt or (e) set aside funds for any
of the foregoing. Notwithstanding the foregoing, (i) any Subsidiary may pay
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dividends or make other distributions to the Company or to a Wholly-Owned
Subsidiary; and (ii) so long as no Event of Default or Unmatured Event of
Default exists or would result therefrom, the Company may, so long as the
Company is a partnership for tax purposes, make cash distributions ("Tax
Distributions") to each of its shareholders from time to time in amounts not
exceeding the amount of income taxes deemed payable by its shareholders with
respect to the net income of the Company (calculated as set forth on Schedule
10.10). If the aggregate Tax Distributions paid to any shareholder of the
Company with respect to any year paid on or prior to date of filing of the
Company's federal income tax return for such year exceeds the actual amount
payable for such year, it shall be an Event of Default if the Company does not
receive a refund of such excess within 10 days of the filing of such return. If
the amounts included in Shareholder Income (as defined on Schedule 10.10) for
any year are decreased as a result of an audit, amended return or otherwise, and
the amount of Tax Distributions paid with respect to such year exceed the amount
of Tax Distributions that would have been permitted with respect to such year
based upon such reduced Shareholder Income, it shall be an Event of Default if
the Company does not receive a refund of such excess within 10 days after the
earliest to occur of (i) a final determination by the Internal Revenue Service
establishing the Company's taxable income for such year, (ii) the date an
amended return is filed or (iii) the date of receipt by the shareholders of the
Company of a tax refund attributable to such excess Tax Distributions. If any
shareholder of the Company would be entitled to a refund of taxes with respect
to which such shareholder has received a Tax Distribution as a result of the
carryback of a hypothetical net operating loss calculated as set forth on
Schedule 10.10, it shall be an Event of Default if the Company does not receive
a refund equal to the refund to which such shareholder is so entitled to within
60 days of the filing of the Company's tax return giving rise to such net
operating loss.
10.11 Mergers, Consolidations, Sales. Not, and not permit any
Subsidiary to, be a party to any merger or consolidation, or purchase or
otherwise acquire all or substantially all of the assets or any stock of any
class of, or any partnership or joint venture interest in, any other Person, or,
except in the ordinary course of its business, sell, transfer, convey or lease
all or any substantial part of its assets, or sell or assign with or without
recourse any receivables, except for (a) any such merger, consolidation, sale,
transfer, conveyance, lease or assignment of or by any Wholly-Owned Subsidiary
into the Company or into, with or to any other Wholly-Owned Subsidiary; (b) any
such purchase or other acquisition by the Company or any Wholly-Owned Subsidiary
of the assets or stock of any Wholly-Owned Subsidiary; (c) any Acquisition by
the Company or any Wholly-Owned Subsidiary where (1) the Company has provided
the Banks with all historic financial information and due diligence with respect
to the Person acquired as requested by the Agent, (2) the assets acquired (in
the case of an asset purchase) are for use, or the Person acquired (in the case
of any other Acquisition) is engaged, solely in the business of acquiring,
developing or marketing software products; (3) immediately before and after
giving effect to such Acquisition, no Event of Default or Unmatured Event of
Default shall exist; (4) the consideration to be paid by the Company and its
Subsidiaries (including any Debt assumed or issued in connection therewith, the
amount thereof to be calculated in accordance with GAAP) in connection with such
Acquisition (or any series of related Acquisitions) is less than $5,000,000 and,
together with all other Acquisitions made in accordance with this Section 10.11,
is less than $15,000,000 in the aggregate; (5) immediately after giving effect
to such Acquisition, the Company is in pro forma compliance with all the
financial ratios and restrictions set forth in Section 10.6; (6) in the case of
the Acquisition of any Person, the Board of Directors of such Person has
approved such Acquisition; (7) the Company or one of its Wholly-Owned
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Subsidiaries will be the surviving entity following the Acquisition; (8) the
EBITDA in respect of the business (in the case of an asset purchase) or Person
(in the case of any other Acquisition) acquired is not less than zero; and (9)
the consideration to be paid by the Company and its subsidiaries (including any
Debt assumed or issued in connection therewith, transaction fees and expenses,
non-cash consideration and excluding cash to be acquired) is less than three
multiplied by the maintenance revenues (as determined in accordance with the
Company's historical accounting policy as in effect on the date hereof) for the
immediately preceding twelve month period of the business or Person, as the case
may be, acquired, (d) sales and dispositions of assets (including the stock of
Subsidiaries) for at least fair market value (as determined by the Board of
Directors of the Company) so long as the net book value of all assets sold or
otherwise disposed of does not exceed 10% of the net book value of the
consolidated assets of the Company and its Subsidiaries as of December 31, 1999
and (e) the Acquisition contemplated by the Merger Agreement.
10.12 Modification of Organizational Documents. Not permit the
Certificate or Articles of Incorporation, By-Laws or other organizational
documents of the Company or any Subsidiary to be amended or modified in any way
which might reasonably be expected to materially adversely affect the interests
of the Banks.
10.13 Use of Proceeds. Use the proceeds of the Loans, and the Letters
of Credit, solely to finance the Merger, for working capital, for Acquisitions
permitted by Section 10.11, to refinance existing debt and for other general
corporate purposes.
10.14 Further Assurances. (a) Take, and cause each Subsidiary to take,
such actions as are necessary or as the Agent or the Required Banks may
reasonably request from time to time (including the execution and delivery of
guaranties, security agreements, pledge agreements, mortgages, deeds of trust,
financing statements and other documents, the filing or recording of any of the
foregoing, and the delivery of stock certificates and other collateral with
respect to which perfection is obtained by possession) to ensure that (a) the
obligations of the Company hereunder and under the other Loan Documents (i) are
secured by substantially all of the assets of the Company and (ii) guaranteed by
all of its Subsidiaries (including, promptly upon the acquisition or creation
thereof, any Subsidiary acquired or created after the date hereof) by execution
of a counterpart of the Guaranty and (b) the obligations of each Subsidiary
under the Guaranty are secured by substantially all of the assets of such
Subsidiary.
(b) Cause each financial institution (other than the Agent) at which
the Company or any Subsidiary maintains any lockbox, deposit account or other
similar account to deliver to the Agent a writing, in form and substance
satisfactory to the Agent, (x) acknowledging and consenting to the security
interest of the Agent in such lockbox or account and all cash, checks, drafts
and other instruments or writings for the payment of money from time to time
therein, (y) confirming such financial institution's agreement to follow the
instructions of the Agent with respect to all such cash, checks, drafts and
other instruments or writings for the payment of money following receipt from
the Agent of notice of the occurrence of any Event of Default or Unmatured Event
of Default and (z) waiving all rights of setoff and banker's lien on all items
held in any such lockbox or account (other than with respect to payment of fees
and expenses for account services).
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10.15 Transactions with Affiliates. Not, and not permit any Subsidiary
to, enter into, or cause, suffer or permit to exist any transaction, arrangement
or contract with any of its other Affiliates (other than the Company and its
Subsidiaries) which is on terms which are less favorable than are obtainable
from any Person which is not one of its Affiliates.
10.16 Employee Benefit Plans. Maintain, and cause each Subsidiary to
maintain, each Pension Plan in substantial compliance with all applicable
requirements of law and regulations.
10.17 Environmental Matters. (a) If any Release or Disposal of
Hazardous Substances shall occur or shall have occurred on any real property or
any other assets of the Company or any Subsidiary, the Company shall, or shall
cause the applicable Subsidiary to, cause the prompt containment and removal of
such Hazardous Substances and the remediation of such real property or other
assets as necessary to comply with all Environmental Laws and to preserve the
value of such real property or other assets. Without limiting the generality of
the foregoing, the Company shall, and shall cause each Subsidiary to, comply
with any valid Federal or state judicial or administrative order requiring the
performance at any real property of the Company or any Subsidiary of activities
in response to the Release or threatened Release of a Hazardous Substance.
(b) To the extent that the transportation of "hazardous waste" as
defined by RCRA is permitted by this Agreement, the Company shall, and shall
cause its Subsidiaries to, dispose of such hazardous waste only at licensed
disposal facilities operating in compliance with Environmental Laws.
10.18 Unconditional Purchase Obligations. Not, and not permit any
Subsidiary to, enter into or be a party to any contract for the purchase of
materials, supplies or other property or services if such contract requires that
payment be made by it regardless of whether delivery is ever made of such
materials, supplies or other property or services.
10.19 Inconsistent Agreements. Not, and not permit any Subsidiary to,
enter into any agreement containing any provision which would (a) be violated or
breached by any borrowing by the Company hereunder or by the performance by the
Company or any Subsidiary of any of its obligations hereunder or under any other
Loan Document, (b) prohibit the Company or any Subsidiary from granting to the
Agent, for the benefit of the Banks, a Lien on any of its assets or (c) create
or permit to exist or become effective any encumbrance or restriction on the
ability of any Subsidiary to (i) pay dividends or make other distributions to
the Company or any other applicable Subsidiary, or pay any Debt owed to the
Company or any other Subsidiary, (ii) make loans or advances to the Company or
(iii) transfer any of its assets or properties to the Company.
10.20 Business Activities. Not, and not permit any Subsidiary to,
engage in any line of business other than the businesses engaged in on the date
hereof and businesses reasonably related thereto.
10.21 Investments. Not, and not permit any Subsidiary to, make or
permit to exist any Investment in any other Person, except (without duplication)
the following:
(a) contributions by the Company to the capital of any of
its Subsidiaries, or by any such Subsidiary to the capital of any of its
Subsidiaries;
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(b) in the ordinary course of business, Investments by the
Company in any Subsidiary or by any Subsidiary in the Company, by way of
intercompany loans, advances or guaranties, all to the extent permitted
by Section 10.7;
(c) Suretyship Liabilities permitted by Section 10.7;
(d) Cash Equivalent Investments;
(e) bank deposits in the ordinary course of business,
provided that the aggregate amount of all such deposits (excluding
amounts in payroll accounts or for accounts payable, in each case to the
extent that checks have been issued to third parties) which are
maintained with any bank other than a Bank shall not at any time
following 60 days from the date hereof exceed $250,000 in accounts
maintained with domestic banks and $5,000,000 in accounts maintained
with banks outside of the United States;
(f) Investments in securities of Account Debtors received
pursuant to any plan of reorganization or similar arrangement upon the
bankruptcy or insolvency of such Account Debtors;
(g) Investments to consummate Acquisitions permitted by
Section 10.11; and
(h) Investments listed on Schedule 10.21;
provided that (x) any Investment which when made complies with the requirements
of the definition of the term "Cash Equivalent Investment" may continue to be
held notwithstanding that such Investment if made thereafter would not comply
with such requirements; (y) no Investment otherwise permitted by clause (b),
(c), or (g) shall be permitted to be made if, immediately before or after giving
effect thereto, any Event of Default or Unmatured Event of Default exists.
10.22 Restriction of Amendments to Certain Documents. Not amend or
otherwise modify, or waive any rights under, the Merger Agreement, the Company's
Certificate of Incorporation or By-laws if, in any case, such amendment,
modification or waiver could be adverse to the interests of the Banks.
10.23 Fiscal Year. Not change its Fiscal Year.
10.24 Cancellation of Debt. Not, and not permit any Subsidiary to,
cancel any claim or debt owing to it, except for reasonable consideration or in
the ordinary course of business, and except for the cancellation of debts or
claims not to exceed $100,000 in any Fiscal Year.
10.25 The Merger. The Company shall consummate the Merger as promptly
as practicable and in any event no later than sixty days following the
acquisition by the Company of a majority of the outstanding shares of capital
stock of Viasoft pursuant to the Tender Offer, provided, however, that if the
Company fails to consummate the Merger within such sixty day period and the
Agent, in its reasonable discretion, determines that the Company is actively
pursuing, in good faith, the consummation of the Merger, such sixty day period
shall be extended for an additional thirty days.
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SECTION 11 EFFECTIVENESS; CONDITIONS OF LENDING, ETC.
The obligation of each Bank to make its Loans and of the Issuing Bank to
issue Letters of Credit is subject to the following conditions precedent:
11.1 Initial Credit Extension. The obligation of the Banks to make
the initial Loans and the obligation of the Issuing Bank to issue its initial
Letter of Credit (whichever first occurs) is, in addition to the conditions
precedent specified in Section 11.3, subject to the conditions precedent that
(1) all Debt to be Repaid has been (or concurrently with the initial borrowing
will be) paid in full, and that all agreements and instruments governing the
Debt to be Repaid and that all Liens securing such Debt to be Repaid have been
(or concurrently with the initial borrowing will be) terminated and (2) the
Agent shall have received all of the following, each duly executed and dated the
Closing Date (or such earlier date as shall be satisfactory to the Agent), in
form and substance satisfactory to the Agent (and the date on which all such
conditions precedent have been satisfied or waived in writing by the Agent and
the Required Banks is called the "Closing Date"):
11.1.1 Notes. The Notes.
11.1.2 Resolutions. Certified copies of resolutions of the Board of
Directors of the Company and ASG authorizing the execution, delivery and
performance by the Company and ASG of this Agreement, the Notes and the other
Loan Documents to which the Company or ASG is a party; and certified copies of
resolutions of the Board of Directors of each other Loan Party authorizing the
execution, delivery and performance by such Loan Party of each Loan Document to
which such entity is a party.
11.1.3 Consents, etc. Certified copies of all documents evidencing any
necessary corporate or partnership action, consents and governmental approvals
(if any) required for the execution, delivery and performance by the Company and
each other Loan Party of the documents referred to in this Section 11.
11.1.4 Incumbency and Signature Certificates. A certificate of the
Secretary or an Assistant Secretary (or other appropriate representative) of
each Loan Party certifying the names of the officer or officers of such entity
authorized to sign the Loan Documents to which such entity is a party, together
with a sample of the true signature of each such officer (it being understood
that the Agent and each Bank may conclusively rely on each such certificate
until formally advised by a like certificate of any changes therein).
11.1.5 Guaranty. A counterpart of the Guaranty executed by each
Subsidiary of the Company other than ASG.
11.1.6 Security Agreement. A counterpart of the Security Agreement
executed by the Company, ASG and each other Subsidiary.
11.1.7 Pledge Agreements. Pledge Agreements executed by the Company and
ASG, together with all items required to be delivered in connection therewith.
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11.1.8 Real Estate Documents. With respect to each parcel of real
property leased by the Company or any Subsidiary:
(a) a Collateral Access Agreement from the owners of each
parcel of real property leased by the Company or any Subsidiary waiving
any landlord's Lien in respect of personal property kept at the premises
subject to such lease; and
(b) original or certified copies of all insurance policies
required to be maintained with respect to such real property by this
Agreement or any other Loan Document.
11.1.9 Opinions of Counsel. The opinions of Steptoe & Xxxxxxx and
XxXxxxxxx, Will & Xxxxx, counsel to the Company, in form and substance
reasonably satisfactory to the Agent.
11.1.10 Insurance. Evidence satisfactory to the Agent of the existence
of insurance required to be maintained pursuant to Section 10.3(b), together
with evidence that the Agent has been named as a lender's loss payee and an
additional insured on all related insurance policies.
11.1.11 Copies of Documents. Copies, certified by the Secretary of the
Company, of the Merger Agreement and all schedules and exhibits thereto.
11.1.12 Payment of Fees. Evidence of payment by the Company of all
accrued and unpaid fees, costs and expenses to the extent then due and payable
on the Closing Date, together with all Attorney Costs of the Agent to the extent
invoiced prior to the Closing Date, plus such additional amounts of Attorney
Costs as shall constitute the Agent's reasonable estimate of Attorney Costs
incurred or to be incurred by the Agent through the closing proceedings
(provided that such estimate shall not thereafter preclude final settling of
accounts between the Company and the Agent).
11.1.13 Solvency Certificate. A Solvency Certificate, substantially in
the form of Exhibit G, executed by a Responsible Officer of the Company.
11.1.14 Search Results; Lien Terminations. Certified copies of Uniform
Commercial Code Requests for Information or Copies (Form UCC-11), or a similar
search report certified by a party acceptable to the Agent, dated a date
reasonably near to the Closing Date, listing all effective financing statements
which name the Company and each Subsidiary (under their present names and any
previous names) as debtors and which are filed in the jurisdictions in which
filings are to be made pursuant to the Collateral Documents, together with (i)
copies of such financing statements, (ii) executed copies of proper Uniform
Commercial Code Form UCC-3 termination statements, if any, necessary to release
all Liens and other rights of any Person in any collateral described in the
Collateral Documents previously granted by any Person (other than Liens
permitted by Section 10.8) and (iii) such other Uniform Commercial Code Form
UCC-3 termination statements as the Agent may reasonably request.
11.1.15 Filings, Registrations and Recordings. The Agent shall have
received each document (including Uniform Commercial Code financing statements)
required by the Collateral Documents or under law or reasonably requested by the
Agent to be filed, registered or recorded in order to create in favor of the
Agent, for the benefit of the Banks, a perfected Lien on the
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collateral described therein, prior and superior to any other Person, in proper
form for filing, registration or recording.
11.1.16 Closing Certificate. A certificate signed by a Responsible
Officer of the Company dated as of the Closing Date, affirming the matters set
forth in Section 11.3.1 as of the Closing Date.
11.1.17 Disbursement Letter. A Disbursement Letter, substantially in the
form of Exhibit H, executed by a Responsible Officer of the Company.
11.1.18 Other. Such other documents as the Agent or any Bank may
reasonably request.
11.2 Additional Conditions Relating to the Tender Offer and the
Merger. The obligation of the Banks to make Loans for the purpose of purchasing
shares of capital stock of Viasoft in connection with the transactions
contemplated by the Merger Agreement is, in addition to the conditions precedent
specified in Section 11.1 and 11.3, subject to the conditions precedent that (1)
the Company shall have provided to the Agent financial and other information
with respect to Viasoft as the Agent shall have requested for periods following
execution of this Agreement; (2) the consideration to be paid to acquire the
outstanding capital stock of Viasoft (including Debt assumed in connection
therewith, Transaction Fees, non-cash consideration, less cash and cash
equivalents acquired in excess of $1,000,000) shall not exceed the lesser of (a)
three multiplied by the pro forma maintenance revenues of Viasoft for the twelve
month period ending March 31, 2000 and (b) $94,000,000; (3) fees and expenses in
connection with the Tender Offer and the Merger shall not exceed $7,000,000; (4)
the Company or ASG shall have accepted for payment pursuant to the Tender Offer
in accordance with the Merger Agreement at least a majority of the outstanding
shares of Viasoft and shall have used its best efforts to acquire such
additional number of shares as may be necessary to consummate the Merger
pursuant to Section 253 of the Delaware General Corporation Law and Viasoft
shall have funds available to purchase its remaining outstanding shares, and all
parties thereto shall take all steps reasonably necessary to consummate the
transactions contemplated by the Merger Agreement; (5) no action shall have been
taken with the intent of enjoining or terminating or materially deferring or
materially altering the Merger or the Tender Offer; (6) the Merger Agreement and
the making of the Loans hereunder in connection therewith shall comply and shall
have been executed in accordance with applicable regulatory and governmental
laws, regulations and ordinances; (7) Viasoft shall have EBITDA, excluding
restructuring charges, for the twelve month period ending March 31, 2000 which
is greater than zero; (8) the Merger shall be in compliance with Section
10.11(c)(3)(5)(6)(7) and (8); and (9) the Agent shall have received all of the
following, each duly executed and dated the Closing Date (or such earlier date
as shall be satisfactory to the Agent), in form and substance satisfactory to
the Agent (and the date on which all such conditions precedent have been
satisfied or waived in writing by the Agent and the Required Banks is called the
"Closing Date"):
11.2.1 Guaranty. A counterpart of the Guaranty executed by Viasoft.
11.2.2 Security Agreement. A counterpart of the Security Agreement
executed by Viasoft.
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11.2.3 Solvency Certificate. A solvency certificate, substantially in
the form of Exhibit G, executed by the chief executive officer, chief financial
officer or other responsible executive or financial officer of Viasoft.
11.2.4 Opinions of Counsel. All opinions delivered in connection with
the Merger Agreement (which opinions shall state, or be accompanied by letters
which state, that the Agent and the Banks may rely thereon).
11.2.5 Search Results; Lien Terminations. Certified copies of Uniform
Commercial Code Requests for Information or Copies (Form UCC-11), or a similar
search report certified by a party acceptable to the Agent, dated a date
reasonably near to the funding of any Loans pursuant to this Section 11.2,
listing all effective financing statements which name Viasoft (under its present
name and any previous names) as debtor and which are filed in the jurisdictions
in which filings are to be made pursuant to the Collateral Documents, together
with (i) copies of such financing statements, (ii) executed copies of proper
Uniform Commercial Code Form UCC-3 termination statements, if any, necessary to
release all Liens and other rights of any Person in any collateral described in
the Collateral Documents previously granted by any Person (other than Liens
permitted by Section 10.8) and (iii) such other Uniform Commercial Code Form
UCC-3 termination statements as the Agent may reasonably request.
11.2.6 Filings, Registrations and Recordings. The Agent shall have
received each document (including Uniform Commercial Code financing statements)
required by the Collateral Documents or under law or reasonably requested by the
Agent to be filed, registered or recorded in order to create in favor of the
Agent, for the benefit of the Banks, a perfected Lien on the collateral
described therein, prior and superior to any other Person, in proper form for
filing, registration or recording.
11.2.7 Opinion of Counsel. The Agent shall have received an opinion of
counsel, in form and substance reasonably satisfactory to the Agent, in respect
of the Guaranty and Security Agreement to be executed by Viasoft.
11.2.8 Closing Certificate. A certificate signed by a Responsible
Officer of the Company dated as of the Closing Date, affirming the matters set
forth in Section 11.3.1 as of the date of the funding of the Loans under this
Section 11.2.
11.2.9 Other. Such other documents as the Agent or any Bank may
reasonably request.
11.3 Conditions. The obligation (a) of each Bank to make each Loan
and (b) of the Issuing Bank to issue each Letter of Credit is subject to the
following further conditions precedent that:
11.3.1 Compliance with Warranties, No Default, etc. Both before and
after giving effect to any borrowing and the issuance of any Letter of Credit,
the following statements shall be true and - correct:
(a) the representations and warranties of the Company and
each Subsidiary set forth in this Agreement and the other Loan Documents
shall be true and correct in all material respects with the same effect
as if then made (except to the extent stated to relate
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to a specific earlier date, in which case such representations and
warranties shall be true and correct as of such earlier date); and
(b) no Event of Default or Unmatured Event of Default shall
have then occurred and be continuing.
11.3.2 Confirmatory Certificate. If requested by the Agent or any Bank,
the Agent shall have received (in sufficient counterparts to provide one to each
Bank) a certificate dated the date of such requested Loan or Letter of Credit
and signed by a duly authorized representative of the Company as to the matters
set out in Section 11.3.1 (it being understood that each request by the Company
for the making of a Loan or the issuance of a Letter of Credit shall be deemed
to constitute a warranty by the Company that the conditions precedent set forth
in Section 11.3.1 will be satisfied at the time of the making of such Loan or
the issuance of such Letter of Credit), together with such other documents as
the Agent or any Bank may reasonably request in support thereof.
SECTION 12 EVENTS OF DEFAULT AND THEIR EFFECT.
12.1 Events of Default. Each of the following shall constitute an
Event of Default under this Agreement:
12.1.1 Non-Payment of the Loans, etc. Default in the payment when due
of the principal of any Loan; or default, and continuance thereof for five days,
in the payment when due of any interest, fee, reimbursement obligation with
respect to any Letter of Credit or other amount payable by the Company hereunder
or under any other Loan Document.
12.1.2 Non-Payment of Other Debt. Any default shall occur under the
terms applicable to any Debt of the Company or any Subsidiary in an aggregate
amount (for all such Debt so affected) exceeding $250,000 and such default shall
(a) consist of the failure to pay such Debt when due, whether by acceleration or
otherwise, or (b) accelerate the maturity of such Debt or permit the holder or
holders thereof, or any trustee or agent for such holder or holders, to cause
such Debt to become due and payable (or require the Company or any Subsidiary to
purchase or redeem such Debt) prior to its expressed maturity.
12.1.3 Other Material Obligations. Default in the payment when due, or
in the performance or observance of, any material obligation of, or condition
agreed to by, the Company or any Subsidiary with respect to any material
purchase or lease of goods or services where such default, singly or in the
aggregate with all other such defaults, might reasonably be expected to have a
Material Adverse Effect.
12.1.4 Bankruptcy, Insolvency, etc. The Company or any Subsidiary
becomes insolvent or generally fails to pay, or admits in writing its inability
or refusal to pay, debts as they become due; or the Company or any Subsidiary
applies for, consents to, or acquiesces in the appointment of a trustee,
receiver or other custodian for the Company or such Subsidiary or any property
thereof, or makes a general assignment for the benefit of creditors; or, in the
absence of such application, consent or acquiescence, a trustee, receiver or
other custodian is appointed for the Company or any Subsidiary or for a
substantial part of the property of any thereof and is not discharged within 60
days; or any bankruptcy, reorganization, debt arrangement, or other case or
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proceeding under any bankruptcy or insolvency law, or any dissolution or
liquidation proceeding, is commenced in respect of the Company or any
Subsidiary, and if such case or proceeding is not commenced by the Company or
such Subsidiary, it is consented to or acquiesced in by the Company or such
Subsidiary, or remains for 30 days undismissed; or the Company or any Subsidiary
takes any action to authorize, or in furtherance of, any of the foregoing.
12.1.5 Non-Compliance with Loan Documents. (a) Failure by the Company
to comply with or to perform any covenant set forth in Sections 10.1.5(a), 10.5
through 10.15, 10.20 through 10.22 and 10.25; or (b) failure by the Company to
comply with or to perform any other provision of this Agreement or any other
Loan Document (and not constituting an Event of Default under any other
provision of this Section 12) and continuance of such failure described in this
clause (b) for 30 days.
12.1.6 Warranties. Any warranty made by the Company or any Subsidiary
herein or any other Loan Document is breached or is false or misleading in any
material respect, or any schedule, certificate, financial statement, report,
notice or other writing furnished by the Company or any Subsidiary to the Agent
or any Bank in connection herewith is false or misleading in any material
respect on the date as of which the facts therein set forth are stated or
certified.
12.1.7 Pension Plans. (i) Institution of any steps by the Company or
any other Person to terminate a Pension Plan if as a result of such termination
the Company could be required to make a contribution to such Pension Plan, or
could incur a liability or obligation to such Pension Plan, in excess of
$100,000; (ii) a contribution failure occurs with respect to any Pension Plan
sufficient to give rise to a Lien under Section 302(f) of ERISA; or (iii) there
shall occur any withdrawal or partial withdrawal from a Multiemployer Pension
Plan and the withdrawal liability (without unaccrued interest) to Multiemployer
Pension Plans as a result of such withdrawal (including any outstanding
withdrawal liability that the Company and the Controlled Group have incurred on
the date of such withdrawal) exceeds $100,000.
12.1.8 Judgments. Final judgments which exceed an aggregate of $250,000
shall be rendered against the Company or any Subsidiary and shall not have been
paid, discharged or vacated or had execution thereof stayed pending appeal
within 30 days after entry or filing of such judgments.
12.1.9 Invalidity of Guaranty, etc. The Guaranty shall cease to be in
full force and effect with respect to any Subsidiary; or any Subsidiary (or any
Person by, through or on behalf of such Subsidiary) shall contest in any manner
the validity, binding nature or enforceability of the Guaranty with respect to
such Subsidiary.
12.1.10 Invalidity of Collateral Documents, etc. Any Collateral Document
shall cease to be in full force and effect; or the Company or any Subsidiary (or
any Person by, through or on behalf of the Company or any Subsidiary) shall
contest in any manner the validity, binding nature or enforceability of any
Collateral Document.
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12.1.11 Invalidity of Subordination Provisions, etc. Any subordination
provision in any document or instrument governing Subordinated Debt, or any
subordination provision in any guaranty by any Subsidiary of any Subordinated
Debt, shall cease to be in full force and effect, or the Company or any other
Person (including the holder of any applicable Subordinated Debt) shall contest
in any manner the validity, binding nature or enforceability of any such
provision.
12.1.12 Change of Control. (a) Xxxxxx Xxxxx shall have ceased to
hold an executive office with the Company at least equal in seniority and
responsibility to his present office and, in the event he ceases to hold such an
executive office by reason of his death or disability, the Company shall have
failed to provide to the Agent within 60 days of such death or disability a
management succession plan which is satisfactory to the Required Banks; or
(b) Xxxxxx Xxxxx shall cease to own and control at least 51% of the
outstanding voting stock of the Company.
12.1.13 Material Adverse Effect. The occurrence of any event having a
Material Adverse Effect.
12.2 Effect of Event of Default. If any Event of Default described in
Section 12.1.4 shall occur, the Commitments (if they have not theretofore
terminated) shall immediately terminate and the Loans and all other obligations
hereunder shall become immediately due and payable and the Company shall become
immediately obligated to Cash Collateralize all Letters of Credit, all without
presentment, demand, protest or notice of any kind; and, if any other Event of
Default shall occur and be continuing, the Agent (upon written request of the
Required Banks) shall declare the Commitments (if they have not theretofore
terminated) to be terminated and/or declare all Loans and all other obligations
hereunder to be due and payable and/or demand that the Company immediately Cash
Collateralize all Letters of Credit, whereupon the Commitments (if they have not
theretofore terminated) shall immediately terminate and/or all Loans and all
other obligations hereunder shall become immediately due and payable and/or the
Company shall immediately become obligated to Cash Collateralize all Letters of
Credit, all without presentment, demand, protest or notice of any kind. The
Agent shall promptly advise the Company of any such declaration, but failure to
do so shall not impair the effect of such declaration. Notwithstanding the
foregoing, the effect as an Event of Default of any event described in Section
12.1.1 or Section 12.1.4 may be waived by the written concurrence of all of the
Banks, and the effect as an Event of Default of any other event described in
this Section 12 may be waived by the written concurrence of the Required Banks.
Any cash collateral delivered hereunder shall be held by the Agent (without
liability for interest thereon) and applied to obligations arising in connection
with any drawing under a Letter of Credit. After the expiration or termination
of all Letters of Credit, such cash collateral shall be applied by the Agent to
any remaining obligations hereunder and any excess shall be delivered to the
Company or as a court of competent jurisdiction may elect.
SECTION 13 THE AGENT.
13.1 Appointment and Authorization. (a) Each Bank hereby irrevocably
(subject to Section 13.9) appoints, designates and authorizes the Agent to take
such action on its behalf under the provisions of this Agreement and each other
Loan Document and to exercise such
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powers and perform such duties as are expressly delegated to it by the terms of
this Agreement or any other Loan Document, together with such powers as are
reasonably incidental thereto. Notwithstanding any provision to the contrary
contained elsewhere in this Agreement or in any other Loan Document, the Agent
shall not have any duty or responsibility except those expressly set forth
herein, nor shall the Agent have or be deemed to have any fiduciary relationship
with any Bank, and no implied covenants, functions, responsibilities, duties,
obligations or liabilities shall be read into this Agreement or any other Loan
Document or otherwise exist against the Agent. The Syndication Agent shall have
no duties or responsibilities hereunder.
(b) The Issuing Bank shall act on behalf of the Banks with respect to
any Letters of Credit issued by it and the documents associated therewith. The
Issuing Bank shall have all of the benefits and immunities (i) provided to the
Agent in this Section 13 with respect to any acts taken or omissions suffered by
the Issuing Bank in connection with Letters of Credit issued by it or proposed
to be issued by it and the applications and agreements for letters of credit
pertaining to such Letters of Credit as fully as if the term "Agent", as used in
this Section 13, included the Issuing Bank with respect to such acts or
omissions and (ii) as additionally provided in this Agreement with respect to
the Issuing Bank.
13.2 Delegation of Duties. The Agent may execute any of its duties under
this Agreement or any other Loan Document by or through agents, employees or
attorneys-in-fact and shall be entitled to advice of counsel concerning all
matters pertaining to such duties. The Agent shall not be responsible for the
negligence or misconduct of any agent or attorney-in-fact that it selects with
reasonable care.
13.3 Liability of Agent. None of the Agent, the Syndication Agent or any
of their directors, officers, employees or agents shall (i) be liable for any
action taken or omitted to be taken by any of them under or in connection with
this Agreement or any other Loan Document or the transactions contemplated
hereby (except for its own gross negligence or willful misconduct), or (ii) be
responsible in any manner to any of the Banks for any recital, statement,
representation or warranty made by the Company or any Subsidiary or Affiliate of
the Company, or any officer thereof, contained in this Agreement or in any other
Loan Document, or in any certificate, report, statement or other document
referred to or provided for in, or received by the Agent under or in connection
with, this Agreement or any other Loan Document, or the validity, effectiveness,
genuineness, enforceability or sufficiency of this Agreement or any other Loan
Document, or for any failure of the Company or any other party to any Loan
Document to perform its obligations hereunder or thereunder. The Agent shall not
be under any obligation to any Bank to ascertain or to inquire as to the
observance or performance of any of the agreements contained in, or conditions
of, this Agreement or any other Loan Document, or to inspect the properties,
books or records of the Company or any of the Company's Subsidiaries or
Affiliates.
13.4 Reliance by Agent. The Agent shall be entitled to rely, and shall
be fully protected in relying, upon any writing, resolution, notice, consent,
certificate, affidavit, letter, telegram, facsimile, telex or telephone message,
statement or other document or conversation believed by it to be genuine and
correct and to have been signed, sent or made by the proper Person or Persons,
and upon advice and statements of legal counsel (including counsel to the
Company), independent accountants and other experts selected by the Agent. The
Agent shall be fully justified in failing or refusing to take any action under
this Agreement or any other Loan
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Document unless it shall first receive such advice or concurrence of the
Required Banks as it deems appropriate and, if it so requests, confirmation from
the Banks of their obligation to indemnify the Agent against any and all
liability and expense which may be incurred by it by reason of taking or
continuing to take any such action. The Agent shall in all cases be fully
protected in acting, or in refraining from acting, under this Agreement or any
other Loan Document in accordance with a request or consent of the Required
Banks and such request and any action taken or failure to act pursuant thereto
shall be binding upon all of the Banks.
13.5 Notice of Default. The Agent shall not be deemed to have knowledge
or notice of the occurrence of any Event of Default or Unmatured Event of
Default except with respect to defaults in the payment of principal, interest
and fees required to be paid to the Agent for the account of the Banks, unless
the Agent shall have received written notice from a Bank or the Company
referring to this Agreement, describing such Event of Default or Unmatured Event
of Default and stating that such notice is a "notice of default". The Agent will
notify the Banks of its receipt of any such notice. The Agent shall take such
action with respect to such Event of Default or Unmatured Event of Default as
may be requested by the Required Banks in accordance with Section 12; provided
that unless and until the Agent has received any such request, the Agent may
(but shall not be obligated to) take such action, or refrain from taking such
action, with respect to such Event of Default or Unmatured Event of Default as
it shall deem advisable or in the best interest of the Banks.
13.6 Credit Decision. Each Bank acknowledges that the Agent has not made
any representation or warranty to it, and that no act by the Agent hereafter
taken, including any review of the affairs of the Company and its Subsidiaries,
shall be deemed to constitute any representation or warranty by the Agent to any
Bank. Each Bank represents to the Agent that it has, independently and without
reliance upon the Agent and based on such documents and information as it has
deemed appropriate, made its own appraisal of and investigation into the
business, prospects, operations, property, financial and other condition and
creditworthiness of the Company and its Subsidiaries, and made its own decision
to enter into this Agreement and to extend credit to the Company hereunder. Each
Bank also represents that it will, independently and without reliance upon the
Agent and based on such documents and information as it shall deem appropriate
at the time, continue to make its own credit analysis, appraisals and decisions
in taking or not taking action under this Agreement and the other Loan
Documents, and to make such investigations as it deems necessary to inform
itself as to the business, prospects, operations, property, financial and other
condition and creditworthiness of the Company. Except for notices, reports and
other documents expressly herein required to be furnished to the Banks by the
Agent, the Agent shall not have any duty or responsibility to provide any Bank
with any credit or other information concerning the business, prospects,
operations, property, financial or other condition or creditworthiness of the
Company which may come into the possession of the Agent.
13.7 Indemnification. Whether or not the transactions contemplated
hereby are consummated, the Banks shall indemnify upon demand the Agent, the
Syndication Agent and their directors, officers, employees and agents (to the
extent not reimbursed by or on behalf of the Company and without limiting the
obligation of the Company to do so), pro rata, from and against any and all
Indemnified Liabilities; provided that no Bank shall be liable for any payment
to any such Person of any portion of the Indemnified Liabilities resulting from
such Person's
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gross negligence or willful misconduct. Without limitation of the foregoing,
each Bank shall reimburse the Agent upon demand for its ratable share of any
costs or out-of-pocket expenses (including Attorney Costs) incurred by the Agent
in connection with the preparation, execution, delivery, administration,
modification, amendment or enforcement (whether through negotiations, legal
proceedings or otherwise) of, or legal advice in respect of rights or
responsibilities under, this Agreement, any other Loan Document, or any document
contemplated by or referred to herein, to the extent that the Agent is not
reimbursed for such expenses by or on behalf of the Company. The undertaking in
this Section shall survive repayment of the Loans, cancellation of the Notes,
expiration or termination of the Letters of Credit, any foreclosure under, or
modification, release or discharge of, any or all of the Collateral Documents,
termination of this Agreement and the resignation or replacement of the Agent or
the Syndication Agent.
13.8 Agent in Individual Capacity. LaSalle and its Affiliates may make
loans to, issue letters of credit for the account of, accept deposits from,
acquire equity interests in and generally engage in any kind of banking, trust,
financial advisory, underwriting or other business with the Company and its
Subsidiaries and Affiliates as though LaSalle were not the Agent or the Issuing
Bank hereunder and without notice to or consent of the Banks. The Banks
acknowledge that, pursuant to such activities, LaSalle or its Affiliates may
receive information regarding the Company or its Affiliates (including
information that may be subject to confidentiality obligations in favor of the
Company or such Affiliate) and acknowledge that the Agent shall be under no
obligation to provide such information to them. With respect to their Loans (if
any), LaSalle and its Affiliates shall have the same rights and powers under
this Agreement as any other Bank and may exercise the same as though LaSalle
were not the Agent and the Issuing Bank, and the terms "Bank" and "Banks"
include LaSalle and its Affiliates, to the extent applicable, in their
individual capacities.
13.9 Successor Agent. The Agent may resign as Agent upon 30 days' notice
to the Banks and may be removed at any time by the Required Banks. If the Agent
resigns under this Agreement or is so removed, the Required Banks shall, with
(so long as no Event of Default exists) the consent of the Company (which shall
not be unreasonably withheld or delayed), appoint from among the Banks a
successor agent for the Banks. If no successor agent is appointed prior to the
effective date of the resignation of the Agent, the Agent may appoint, after
consulting with the Banks and the Company, a successor agent from among the
Banks. Upon the acceptance of its appointment as successor agent hereunder,
such successor agent shall succeed to all the rights, powers and duties of the
retiring Agent and the term "Agent" shall mean such successor agent, and the
retiring Agent's appointment, powers and duties as Agent shall be terminated.
After any retiring Agent's resignation hereunder as Agent, the provisions of
this Section 13 and Sections 14.6 and 14.13 shall inure to its benefit as to
any actions taken or omitted to be taken by it while it was Agent under this
Agreement. If no successor agent has accepted appointment as Agent by the date
which is 30 days following a retiring Agent's notice of resignation, the
retiring Agent's resignation shall nevertheless thereupon become effective and
the Banks shall perform all of the duties of the Agent hereunder until such
time, if any, as the Required Banks appoint a successor agent as provided for
above.
13.10 Collateral Matters. The Banks irrevocably authorize the Agent, at
its option and in its discretion, (a) to release any Lien granted to or held by
the Agent under any Collateral
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Document (i) upon termination of the Commitments and payment in full of all
Loans and all other obligations of the Company hereunder and the expiration or
termination of all Letters of Credit; (ii) constituting property sold or to be
sold or disposed of as part of or in connection with any disposition permitted
hereunder; or (iii) subject to Section 14.1, if approved, authorized or ratified
in writing by the Required Banks; or (b) to subordinate its interest in any
collateral to any holder of a Lien on such collateral which is permitted by
clause (d)(i) or (d)(iii) of Section 10.8 (it being understood that the Agent
may conclusively rely on a certificate from the Company in determining whether
the Debt secured by any such Lien is permitted by Section 10.7(b)). Upon request
by the Agent at any time, the Banks will confirm in writing the Agent's
authority to release, or subordinate its interest in, particular types or items
of collateral pursuant to this Section 13.10.
SECTION 14 GENERAL.
14.1 Waiver; Amendments. (a) No delay on the part of the Agent or any
Bank in the exercise of any right, power or remedy shall operate as a waiver
thereof, nor shall any single or partial exercise by any of them of any right,
power or remedy preclude other or further exercise thereof, or the exercise of
any other right, power or remedy. No amendment, modification or waiver of, or
consent with respect to, any provision of this Agreement or the Notes shall in
any event be effective unless the same shall be in writing and signed and
delivered by Banks having an aggregate Pro Rata Share of not less than the
aggregate Pro Rata Share expressly designated herein with respect thereto or, in
the absence of such designation as to any provision of this Agreement or the
Notes, by the Required Banks, and then any such amendment, modification, waiver
or consent shall be effective only in the specific instance and for the specific
purpose for which given. No amendment, modification, waiver or consent shall
change the Pro Rata Share of any Bank without the consent of such Bank. No
amendment, modification, waiver or consent shall (i) increase the Revolving
Commitment Amount, (ii) extend the date for payment of any principal of or
interest on the Loans or any fees payable hereunder, (iii) reduce the principal
amount of any Loan, the rate of interest thereon or any fees payable hereunder,
(iv) release the Guaranty or all or any substantial part of the collateral
granted under the Collateral Documents or (v) reduce the aggregate Pro Rata
Share required to effect an amendment, modification, waiver or consent without,
in each case, the consent of all Banks. No provision of Section 13 or other
provision of this Agreement affecting the Agent in its capacity as such shall be
amended, modified or waived without the consent of the Agent. No provision of
this Agreement relating to the rights or duties of the Issuing Bank in its
capacity as such shall be amended, modified or waived without the consent of the
Issuing Bank.
(b) If, in connection with any proposed amendment, modification,
waiver or termination: (i) requiring the consent of all Banks, the consent of
the Required Banks is obtained, but the consent of other Banks whose consent is
required is not obtained (any such Bank whose consent is not obtained as
described in this clause (i) and in clause (ii) below being referred to as a
"Non-Consenting Bank"), or (ii) requiring the consent of Required Banks, the
consent of Banks holding 51% or more of the aggregate Commitments is obtained,
but the consent of Required Banks is not obtained, then, so long as the Agent is
not a Non-Consenting Bank, at the Company's request the Agent, or a Person
reasonably acceptable to the Agent, shall have the right (but shall have no
obligation) to purchase from such Non-Consenting Banks, and such Non-Consenting
Banks agree that they shall sell and assign to the Agent or such Person, all
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of the Commitments of such Non-Consenting Banks for an amount equal to the
principal balance of all Loans held by the Non-Consenting Banks and all accrued
interest and fees with respect thereto through the date of sale, such purchase
and sale to be consummated pursuant to an executed Assignment Agreement.
14.2 Confirmations. The Company and each holder of a Note agree from time
to time, upon written request received by it from the other, to confirm to the
other in writing (with a copy of each such confirmation to the Agent) the
aggregate unpaid principal amount of the Loans then outstanding under such Note.
14.3 Notices. Except as otherwise provided in Sections 2.2.2 and 2.2.3,
all notices hereunder shall be in writing (including facsimile transmission) and
shall be sent to the applicable party at its address shown on Schedule 14.3 or
at such other address as such party may, by written notice received by the other
parties, have designated as its address for such purpose. Notices sent by
facsimile transmission shall be deemed to have been given when sent; notices
sent by mail shall be deemed to have been given three Business Days after the
date when sent by registered or certified mail, postage prepaid; and notices
sent by hand delivery or overnight courier service shall be deemed to have been
given when received. For purposes of Sections 2.2.2 and 2.2.3, the Agent shall
be entitled to rely on telephonic instructions from any person that the Agent in
good faith believes is an authorized officer or employee of the Company, and the
Company shall hold the Agent and each other Bank harmless from any loss, cost or
expense resulting from any such reliance.
14.4 Computations. Where the character or amount of any asset or
liability or item of income or expense is required to be determined, or any
consolidation or other accounting computation is required to be made, for the
purpose of this Agreement, such determination or calculation shall, to the
extent applicable and except as otherwise specified in this Agreement, be made
in accordance with GAAP, consistently applied; provided that if the Company
notifies the Agent that the Company wishes to amend any covenant in Section 10
to eliminate or to take into account the effect of any change in GAAP on the
operation of such covenant (or if the Agent notifies the Company that the
Required Banks wish to amend Section 10 for such purpose), then the Company's
compliance with such covenant shall be determined on the basis of GAAP in effect
immediately before the relevant change in GAAP became effective, until either
such notice is withdrawn or such covenant is amended in a manner satisfactory to
the Company and the Required Banks.
14.5 [Intentionally Omitted].
14.6 Costs, Expenses and Taxes. The Company agrees to pay on demand all
reasonable out-of-pocket costs and expenses of the Agent (including Attorney
Costs) in connection with the preparation, execution, syndication, delivery and
administration of this Agreement, the other Loan Documents and all other
documents provided for herein or delivered or to be delivered hereunder or in
connection herewith (including any amendment, supplement or waiver to any Loan
Document), and all reasonable out-of-pocket costs and expenses (including
Attorney Costs) incurred by the Agent and each Bank
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after an Event of Default in connection with the enforcement of this Agreement,
the other Loan Documents or any such other documents. In addition, the Company
agrees to pay, and to save the Agent and the Banks harmless from all liability
for, (a) any stamp or other taxes (excluding income taxes and franchise taxes
based on net income) which may be payable in connection with the execution and
delivery of this Agreement, the borrowings hereunder, the issuance of the Notes
or the execution and delivery of any other Loan Document or any other document
provided for herein or delivered or to be delivered hereunder or in connection
herewith and (b) any fees of the Company's auditors in connection with any
reasonable exercise by the Agent and the Banks of their rights pursuant to
Section 10.2. All obligations provided for in this Section 14.6 shall survive
repayment of the Loans, cancellation of the Notes, expiration or termination of
the Letters of Credit and termination of this Agreement.
14.7 Subsidiary References. The provisions of this Agreement relating to
Subsidiaries shall apply only during such times as the Company has one or more
Subsidiaries.
14.8 Captions. Section captions used in this Agreement are for
convenience only and shall not affect the construction of this Agreement.
14.9 Assignments; Participations.
14.9.1 Assignments. Any Bank may, with the prior written consents of the
Issuing Bank and the Agent and (so long as no Event of Default exists) the
Company (which consents shall not be unreasonably delayed or withheld and, in
any event, shall not be required for an assignment by a Bank to one of its
Affiliates), at any time assign and delegate to one or more commercial banks or
other Persons (any Person to whom such an assignment and delegation is to be
made being herein called an "Assignee") all or any fraction of such Bank's Loans
and Commitment (which assignment and delegation shall be of a constant, and not
a varying, percentage of all the assigning Bank's Loans and Commitment) in a
minimum aggregate amount equal to the lesser of (i) the amount of the assigning
Bank's Pro Rata Share of the Revolving Commitment Amount and (ii) $5,000,000;
provided that (a) no assignment and delegation may be made to any Person if, at
the time of such assignment and delegation, the Company would be obligated to
pay any greater amount under Section 7.6 or Section 8 to the Assignee than the
Company is then obligated to pay to the assigning Bank under such Sections (and
if any assignment is made in violation of the foregoing, the Company will not be
required to pay the incremental amounts) and (b) the Company and the Agent shall
be entitled to continue to deal solely and directly with such Bank in connection
with the interests so assigned and delegated to an Assignee until the date when
all of the following conditions shall have been met:
(x) five Business Days (or such lesser period of time as the Agent
and the assigning Bank shall agree) shall have passed after written
notice of such assignment and delegation, together with payment
instructions, addresses and related information with respect to such
Assignee, shall have been given to the Company and the Agent by such
assigning Bank and the Assignee,
(y) the assigning Bank and the Assignee shall have executed and
delivered to the Company and the Agent an assignment agreement in form
and substance satisfactory to the Agent (an "Assignment Agreement"),
together with any documents required to be delivered thereunder, which
Assignment Agreement shall have been accepted by the Agent, and
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(z) except in the case of an assignment by a Bank to one of its
Affiliates, the assigning Bank or the Assignee shall have paid the Agent
a processing fee of $3,500.
From and after the date on which the conditions described above have been met,
(x) such Assignee shall be deemed automatically to have become a party hereto
and, to the extent that rights and obligations hereunder have been assigned and
delegated to such Assignee pursuant to such Assignment Agreement, shall have the
rights and obligations of a Bank hereunder and (y) the assigning Bank, to the
extent that rights and obligations hereunder have been assigned and delegated by
it pursuant to such Assignment Agreement, shall be released from its obligations
hereunder. Within five Business Days after effectiveness of any assignment and
delegation, the Company shall execute and deliver to the Agent (for delivery to
the Assignee and the Assignor, as applicable) a new Note in the principal amount
of the Assignee's Pro Rata Share of the Revolving Commitment Amount and, if the
assigning Bank has retained a Commitment hereunder, a replacement Note in the
principal amount of the Pro Rata Share of the Revolving Commitment Amount
retained by the assigning Bank (such Note to be in exchange for, but not in
payment of, the predecessor Note held by such assigning Bank). Each such Note
shall be dated the effective date of such assignment. The assigning Bank shall
xxxx the predecessor Note "exchanged" and deliver it to the Company. Accrued
interest on that part of the predecessor Note being assigned shall be paid as
provided in the Assignment Agreement. Accrued interest and fees on that part of
the predecessor Note not being assigned shall be paid to the assigning Bank.
Accrued interest and accrued fees shall be paid at the same time or times
provided in the predecessor Note and in this Agreement. Any attempted assignment
and delegation not made in accordance with this Section 14.9.1 shall be null and
void.
Notwithstanding the foregoing provisions of this Section 14.9.1 or any
other provision of this Agreement, any Bank may at any time assign all or any
portion of its Loans and its Note to a Federal Reserve Bank (but no such
assignment shall release any Bank from any of its obligations hereunder).
14.9.2 Participations. Any Bank may at any time sell to one or more
commercial banks or other Persons participating interests in any Loan owing to
such Bank, the Note held by such Bank, the Commitment of such Bank, the direct
or participation interest of such Bank in any Letter of Credit or any other
interest of such Bank hereunder (any Person purchasing any such participating
interest being herein called a "Participant"). In the event of a sale by a Bank
of a participating interest to a Participant, (x) such Bank shall remain the
holder of its Note for all purposes of this Agreement, (y) the Company and the
Agent shall continue to deal solely and directly with such Bank in connection
with such Bank's rights and obligations hereunder and (z) all amounts payable by
the Company shall be determined as if such Bank had not sold such participation
and shall be paid directly to such Bank. No Participant shall have any direct or
indirect voting rights hereunder except with respect to any of the events
described in the fourth sentence of Section 14.1. Each Bank agrees to
incorporate the requirements of the preceding sentence into each participation
agreement which such Bank enters into with any Participant. The Company agrees
that if amounts outstanding under this Agreement and the Notes are due and
payable (as a result of acceleration or otherwise), each Participant shall be
deemed to have the right of setoff in respect of its participating interest in
amounts owing under this Agreement, any Note and with respect to any Letter of
Credit to the same extent as if the amount of its participating interest were
owing directly to it as a Bank under this Agreement or such Note;
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provided that such right of setoff shall be subject to the obligation of each
Participant to share with the Banks, and the Banks agree to share with each
Participant, as provided in Section 7.5. The Company also agrees that each
Participant shall be entitled to the benefits of Section 7.6 and Section 8 as if
it were a Bank (provided that no Participant shall receive any greater
compensation pursuant to Section 7.6 or Section 8 than would have been paid to
the participating Bank if no participation had been sold).
14.10 Governing Law. This Agreement and each Note shall be a contract
made under and governed by the internal laws of the State of Illinois applicable
to contracts made and to be performed entirely within such State. Whenever
possible each provision of this Agreement shall be interpreted in such manner as
to be effective and valid under applicable law, but if any provision of this
Agreement shall be prohibited by or invalid under applicable law, such provision
shall be ineffective to the extent of such prohibition or invalidity, without
invalidating the remainder of such provision or the remaining provisions of this
Agreement. All obligations of the Company and rights of the Agent and the Banks
expressed herein or in any other Loan Document shall be in addition to and not
in limitation of those provided by applicable law.
14.11 Counterparts. This Agreement may be executed in any number of
counterparts and by the different parties hereto on separate counterparts and
each such counterpart shall be deemed to be an original, but all such
counterparts shall together constitute but one and the same Agreement.
14.12 Successors and Assigns. This Agreement shall be binding upon the
Company, the Banks and the Agent and their respective successors and assigns,
and shall inure to the benefit of the Company, the Banks and the Agent and the
successors and assigns of the Banks and the Agent.
14.13 Indemnification by the Company. In consideration of the execution
and delivery of this Agreement by the Agent and the Banks and the agreement to
extend the Commitments provided hereunder, the Company hereby agrees to
indemnify, exonerate and hold the Agent, each Bank and each of the officers,
directors, employees, Affiliates and agents of the Agent and each Bank (each a
"Bank Party") free and harmless from and against any and all actions, causes of
action, suits, losses, liabilities, damages and expenses, including Attorney
Costs (collectively, the "Indemnified Liabilities"), incurred by the Bank
Parties or any of them as a result of, or arising out of, or relating to (i) any
tender offer, merger, purchase of stock, purchase of assets (including the
Merger) or other similar transaction financed or proposed to be financed in
whole or in part, directly or indirectly, with the proceeds of any of the Loans,
(ii) the use, handling, release, emission, discharge, transportation, storage,
treatment or disposal of any hazardous substance at any property owned or leased
by the Company or any Subsidiary, (iii) any violation of any Environmental Laws
with respect to conditions at any property owned or leased by the Company or any
Subsidiary or the operations conducted thereon, (iv) the investigation, cleanup
or remediation of offsite locations at which the Company or any Subsidiary or
their respective predecessors are alleged to have directly or indirectly
disposed of hazardous substances or (v) the execution, delivery, performance or
enforcement of this Agreement or any other Loan Document by any of the Bank
Parties, except for any such Indemnified Liabilities arising on account of the
applicable Bank Party's gross negligence or willful misconduct. If and to the
extent that the foregoing undertaking may be unenforceable for any reason, the
Company hereby agrees to
57
66
make the maximum contribution to the payment and satisfaction of each of the
Indemnified Liabilities which is permissible under applicable law. All
obligations provided for in this Section 14.13 shall survive repayment of the
Loans, cancellation of the Notes, expiration or termination of the Letters of
Credit, any foreclosure under, or any modification, release or discharge of, any
or all of the Collateral Documents and termination of this Agreement.
14.14 Nonliability of Lenders. The relationship between the Company on
the one hand and the Banks and the Agent on the other hand shall be solely that
of borrower and lender. Neither the Agent nor any Bank shall have any fiduciary
responsibility to the Company. Neither the Agent nor any Bank undertakes any
responsibility to the Company to review or inform the Company or any matter in
connection with any phase of the Company's business or operations. The Company
agrees that neither the Agent nor any Bank shall have liability to the Company
(whether sounding in tort, contract or otherwise) for losses suffered by the
Company 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 in a final non-appealable judgment by a court of
competent jurisdiction that such losses resulted from the gross negligence or
willful misconduct of the party from which recovery is sought. Neither the Agent
nor any Bank shall have any liability with respect to, and the Company hereby
waives, releases and agrees not to xxx for, any special, indirect or
consequential damages suffered by the Company in connection with, arising out
of, or in any way related to the Loan Documents or the transactions contemplated
thereby.
14.15 Forum Selection and Consent to Jurisdiction. ANY LITIGATION BASED
HEREON, OR ARISING OUT OF, UNDER, OR IN CONNECTION WITH THIS AGREEMENT OR ANY
OTHER LOAN DOCUMENT, SHALL BE BROUGHT AND MAINTAINED EXCLUSIVELY IN THE COURTS
OF THE STATE OF ILLINOIS OR IN THE UNITED STATES DISTRICT COURT FOR THE NORTHERN
DISTRICT OF ILLINOIS; PROVIDED THAT ANY SUIT SEEKING ENFORCEMENT AGAINST ANY
COLLATERAL OR OTHER PROPERTY MAY BE BROUGHT, AT THE AGENT'S OPTION, IN THE
COURTS OF ANY JURISDICTION WHERE SUCH COLLATERAL OR OTHER PROPERTY MAY BE FOUND.
THE COMPANY HEREBY EXPRESSLY AND IRREVOCABLY SUBMITS TO THE JURISDICTION OF THE
COURTS OF THE STATE OF ILLINOIS AND OF THE UNITED STATES DISTRICT COURT FOR THE
NORTHERN DISTRICT OF ILLINOIS FOR THE PURPOSE OF ANY SUCH LITIGATION AS SET
FORTH ABOVE. THE COMPANY FURTHER IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS
BY REGISTERED MAIL, POSTAGE PREPAID, OR BY PERSONAL SERVICE WITHIN OR WITHOUT
THE STATE OF ILLINOIS. THE COMPANY HEREBY EXPRESSLY AND IRREVOCABLY WAIVES, TO
THE FULLEST EXTENT PERMITTED BY LAW, ANY OBJECTION WHICH IT MAY NOW OR HEREAFTER
HAVE TO THE LAYING OF VENUE OF ANY SUCH LITIGATION BROUGHT IN ANY SUCH COURT
REFERRED TO ABOVE AND ANY CLAIM THAT ANY SUCH LITIGATION HAS BEEN BROUGHT IN AN
INCONVENIENT FORUM.
14.16 Waiver of Jury Trial. EACH OF THE COMPANY, THE AGENT AND EACH BANK
HEREBY WAIVES ANY RIGHT TO A TRIAL BY JURY IN ANY ACTION OR PROCEEDING TO
ENFORCE OR DEFEND ANY RIGHTS UNDER THIS AGREEMENT, ANY NOTE, ANY OTHER LOAN
DOCUMENT AND ANY AMENDMENT,
58
67
INSTRUMENT, DOCUMENT OR AGREEMENT DELIVERED OR WHICH MAY IN THE FUTURE BE
DELIVERED IN CONNECTION HEREWITH OR THEREWITH OR ARISING FROM ANY BANKING
RELATIONSHIP EXISTING IN CONNECTION WITH ANY OF THE FOREGOING, AND AGREES THAT
ANY SUCH ACTION OR PROCEEDING SHALL BE TRIED BEFORE A COURT AND NOT BEFORE A
JURY.
[SIGNATURE PAGE TO FOLLOW]
59
68
Delivered at Chicago, Illinois, as of the day and year first above
written.
XXXXX SYSTEMS GROUP, INC.
By /s/
-------------------------------------------
Title: President and Chief Executive Officer
----------------------------------------
ASG SUB, INC.
By /s/
-------------------------------------------
Title: President and Chief Executive Officer
----------------------------------------
LASALLE BANK NATIONAL ASSOCIATION,
as Administrative Agent
By /s/
-------------------------------------------
Title: First Vice President
----------------------------------------
KEYBANK NATIONAL ASSOCIATION,
as Syndication Agent
By /s/
-------------------------------------------
Title: Vice President
----------------------------------------
LASALLE BANK NATIONAL ASSOCIATION,
as Issuing Bank and as a Bank
By /s/
-------------------------------------------
Title: First Vice President
----------------------------------------
KEYBANK NATIONAL ASSOCIATION,
as a Bank
By /s/
-------------------------------------------
Title: Vice President
----------------------------------------
69
PRICING SCHEDULE
The Eurodollar Margin, the Base Rate Margin, the Non-Use Fee Rate and the
LC Fee Rate shall be determined as set forth below.
Initially, the Eurodollar Margin shall be 2.75% per annum, the Base Rate
Margin shall be 1.5% per annum, the Non-Use Fee Rate shall be .50% per annum and
the LC Fee Rate shall be 2.75% per annum.
On and after December 31, 2000, the Eurodollar Margin, the Base Rate
Margin, the Commitment Fee Rate and the LC Fee Rate shall be equal to the
applicable rate per annum set forth in the table below opposite the applicable
Total Debt to EBITDA Ratio:
TOTAL DEBT EURODOLLAR BASE RATE NON-USE
TO EBITDA RATIO MARGIN MARGIN FEE RATE LC FEE RATE
Greater than 1.5:1 2.75% 1.50% .50% 2.75%
Greater than 1.25:1 but less
than or equal to 1:50:1 2.50% 1.25% .375% 2.50%
Less than 1.25:1 2.25% 1.00% .375% 2.25%
The Eurodollar Margin, the Base Rate Margin, the Non-Use Fee Rate and the LC Fee
Rate shall be adjusted, to the extent applicable, on the 30th (or, in the case
of the last Fiscal Quarter of each Fiscal Year, 120th) day after the end of each
Fiscal Quarter based on the Total Debt to EBITDA Ratio as of the last day of
such Fiscal Quarter; it being understood that if the Company fails to deliver
the financial statements required by Section 10.1.1 or 10.1.2, as applicable,
and the related Compliance Certificate, required by Section 10.1.3 by the 30th
day (or, if applicable, the 120th day) after any Fiscal Quarter, the Eurodollar
Margin shall be 2.75%, the Base Rate Margin shall be 1.50%, the Commitment Fee
Rate shall be .50% and the LC Fee Rate shall be 2.75% until such financial
statements and Compliance Certificate are delivered. Notwithstanding the
foregoing, no reduction to the foregoing interest rate margins or fee rates
shall become effective at any time when an Event of Default or Unmatured Event
of Default has occurred and is continuing.
70
SCHEDULE 2.1
BANKS AND PRO RATA SHARES
Pro Rata Share of
Bank Revolving Commitment Amount Pro Rata Share
---- --------------------------- --------------
LaSalle Bank National Association $50,000,000 50%
KeyBank National Association $50,000,000 50%
----------- ---
TOTALS $100,000,000 100%
71
SCHEDULE 9.6
LITIGATION AND CONTINGENT LIABILITIES
Xxxxx Systems Group, Inc. v. IBM - This is a breach of contract and tortious
interference claim against IBM. ASG is the plaintiff. ASG prevailed on IBM's
motion to dismiss the case. The case is presently in the discovery stage.
Xxxxx Systems Group, Inc. x. Xxxxxx. This is a civil theft claim against Xxxxxx
Xxxxxx, a former employee of ASG. ASG is the plaintiff. The complaint has been
filed. The judge has issued an abatement in the case pending further discovery
on the jurisdictional issue.
Xxxxx Systems Group, Inc. v. MSP Int'l Sales Holdings B.V.: This is breach of
contract claim against MSP involving the Asset Purchase Agreement. MSP has
filed a counterclaim against ASG. The dispute has been submitted to binding
arbitration and is in the pleading stage.
Xxxxx Systems Group, Inc. v. Webgear, Inc.: This is a civil breach of contract
and civil theft case against a former sublessee of an ASG office in California.
ASG is the Plaintiff. A default judgment has been entered against the
Defendant. ASG is currently seeking to collect on the judgment.
Xxxxxx Xxxxx x. Xxxxx Systems Group, Inc.: This is a sexual harassment suit
filed with the EEOC against ASG by a former female employee. The suit alleges
sexual harassment by a coworker and supervisor of the former employee. ASG
denies the allegation and anticipates the suit being dismissed.
72
SCHEDULE 9.8
SUBSIDIARIES
Name: ASG Sub, Inc.
State of Incorporation: Delaware
Principal Address: 0000 Xxxxx Xxxxxx Xxxxx
Xxxxxx, XX 00000
Name: SISRO, SARL
State of Incorporation: France
Principal Address: Tour Manhattan
0, Xxxxx xx X'xxxx
00000 Xxxxx La Defense Cedex
France
73
SCHEDULE 9.15
ENVIRONMENTAL MATTERS
NONE
74
SCHEDULE 9.17
INSURANCE
SEE ATTACHED EXHIBITS
75
SCHEDULE 9.18
REAL PROPERTY
SEE ATTACHED EXHIBITS
76
SCHEDULE 9.22
LABOR MATTERS
Xxxxxx Xxxxx v. ASG. This is a sexual harassment suit filed with the EEOC
against ASG by a former female employee. The suit alleges sexual harassment by
a coworker and supervisor of the former employee. ASG denies the allegation and
anticipates the suit being dismissed.
77
SCHEDULE 10.7
LIMITATION ON DEBT
SEE ATTACHED EXHIBIT.
78
XXXXX SYSTEMS GROUP, INC.
Schedule of outstanding debt as of 04/26/2000.
Capital Lease Obligations 259,517
-Xxxxxxx (Furniture)
-Bankers Direct (Computer Hardware)
-Bankers Direct (Danka Office Equip)
-Amplicon Financial (Video Conf. Equip)
-AT&T Telephone 24,838
-AT&T Telephone 6,631
-IBM P390 Server 4,997
-Sharp Copier 2,945
-Danka Copier 5,693
Credit Mutual (FRF expressed in USD) 26,634 - Forex 0.1454
Total Debt Obligations 331,255
79
SCHEDULE 10.8
LIENS
NONE
80
SCHEDULE 10.10
CALCULATION OF PERMITTED TAX DISTRIBUTIONS
The amount of Tax Distributions which are permitted for any period shall
be equal to the amount computed for such period as the total U.S. federal,
state and local income taxes for which the Company's shareholders would be
liable if (x) the shareholders' income ("Shareholder Income") were only from
items of income, gain, loss, deduction or credit attributable to their
interests in the Company for the period beginning on the first day of such
period and ending on the last day of such period and (y) the tax rates applied
to such income were the Individual Rates applicable to the Company's
shareholders described below.
For purposes of the foregoing:
(a) "Individual Rates" means the highest marginal individual U.S.
federal, state and local income tax rates imposed by Section 1 of the Code, or
if Shareholder Income were subject to alternative minimum tax, Section 55 of the
Code, and by the equivalent provisions of state and local personal income tax
law (taking into account the allocation and apportionment of the Company's
income to each state to which the Company's income is ultimately allocated or
apportioned) determined without regard to phase-in or phase-out rules.
(b) Penalties will be excluded.
(c) (i) The benefits of the deductibility of state income taxes and
allowable credits in effect for each of the respective tax periods will be taken
into account and (ii) the benefits of hypothetical net operating loss
carry-forwards attributable to the Company will be taken into account (in the
case of both (i) and (ii), calculated on a basis consistent with the assumption
that no partner will be deemed to have any item of income, gain, loss, deduction
or credit from any source other than such shareholder's holdings in the
Company).
(d) The benefits of net operating losses arising during any period
shall be determined without regard to any elections relating to carry backs and
carry forwards.
(e) The benefits of all other carry forwards and carry backs shall be
determined in a manner consistent with clauses (c) (ii) and (d) above.
(f) Computations shall be made on an annual basis, but interim
calculations may be made on a good faith basis to permit partners to make
estimated tax payments from time to time.
81
SCHEDULE 10.21
INVESTMENTS
NONE
82
SCHEDULE 11.1
INITIAL CREDIT EXTENSION - DEBT TO BE REPAID
First Union National Bank Credit Agreement as amended on November 29, 1999
$20,520,765* (Does not include accrued interest)
First Union National Bank Revolving Credit Agreement up to a maximum of
$3,000,000 as amended November 29, 1999 in the amount of $1,088,237*
*Estimate
83
SCHEDULE 14.3
ADDRESSES FOR NOTICES
XXXXX SYSTEMS GROUP, INC. and ASG SUB, INC.
0000 Xxxxx Xxxxxx Xxxxx
Xxxxxx, XX 00000
Attention: Xxxxxxx Xxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
with a copy to:
Steptoe & Xxxxxxx
0000 Xxxxxxxxxxx Xxxxxx XX
Xxxxxxxxxx, X.X. 00000
Attention: Xxxxxx XxXxxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
LASALLE BANK NATIONAL ASSOCIATION, as Agent, Issuing Bank and a Bank
Notices of Borrowing, Conversion, Continuation and Letter of Credit Issuance
000 Xxxxx XxXxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxx X. XxXxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
All Other Notices
000 Xxxxx XxXxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxx X. XxXxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
with a copy to:
Seyfarth, Shaw, Xxxxxxxxxxx & Xxxxxxxxx
00 Xxxx Xxxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxx Xxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
84
KEYBANK NATIONAL ASSOCIATION, as Agent and a Bank
Notices of Borrowing, Conversion, Continuation and Letter of Credit Issuance
000 Xxxxx Xxxxxx, 00xx Xxxxx
Mail Code WA-31-10-4612
Xxxxxxx, XX 00000
Attention: Xxxxxx Xxxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
