================================================================================
Exhibit 4.1
CREDIT AGREEMENT
Dated as of July 22, 2002
among
PRIME HOSPITALITY CORP.,
as Borrower,
THE LENDERS LISTED HEREIN,
as Lenders,
CANADIAN IMPERIAL BANK OF COMMERCE,
as Administrative Agent,
CIBC WORLD MARKETS CORP.,
as Lead Arranger,
PNC BANK, NATIONAL ASSOCIATION AND
MANUFACTURERS AND TRADERS TRUST COMPANY,
as Co-Syndication Agents
and
BEAR XXXXXXX CORPORATE LENDING, INC.,
as Documentation Agent
================================================================================
TABLE OF CONTENTS
Page No.
--------
Section 1. DEFINITIONS........................................................................ 2
1.1 Certain Defined Terms............................................................... 2
1.2 Accounting Terms; Utilization of GAAP for Purposes of Calculations Under
Agreement........................................................................... 27
1.3 Other Definitional Provisions and Rules of Construction............................. 28
Section 2. AMOUNTS AND TERMS OF COMMITMENTS AND LOANS.......................................... 28
2.1 Commitments; Making of Loans; Optional Notes........................................ 28
2.2 Interest on the Loans............................................................... 35
2.3 Fees................................................................................ 39
2.4 Repayments, Prepayments and Reductions in Revolving Loan Commitments; General
Provisions Regarding Payments; Application of Proceeds of Collateral and
Payments Under Subsidiary Guaranty.................................................. 40
2.5 Use of Proceeds..................................................................... 45
2.6 Special Provisions Governing LIBOR Loans............................................ 45
2.7 Increased Costs; Taxes; Capital Adequacy............................................ 48
2.8 Obligation of Lenders and Issuing Lenders to Mitigate............................... 52
2.9 Replacement of a Lender............................................................. 53
Section 3. LETTERS OF CREDIT................................................................... 54
3.1 Issuance of Letters of Credit and Lenders' Purchase of Participations Therein....... 54
3.2 Letter of Credit Fees............................................................... 57
3.3 Drawings and Reimbursement of Amounts Paid Under Letters of Credit.................. 57
3.4 Obligations Absolute................................................................ 60
3.5 Indemnification; Nature of Issuing Lenders' Duties.................................. 61
Section 4. CONDITIONS TO LOANS AND LETTERS OF CREDIT........................................... 62
4.1 Conditions to Initial Revolving Loans............................................... 62
4.2 Conditions to All Loans............................................................. 66
i
4.3 Conditions to Letters of Credit..................................................... 67
Section 5. BORROWER'S REPRESENTATIONS AND WARRANTIES........................................... 67
5.1 Organization, Powers, Qualification, Good Standing, Business and Subsidiaries....... 67
5.2 Authorization of Borrowing, etc..................................................... 68
5.3 Financial Condition................................................................. 69
5.4 No Material Adverse Change; No Restricted Junior Payments........................... 70
5.5 Title to Properties; Liens; Real Property; Intellectual Property.................... 70
5.6 Litigation; Adverse Facts........................................................... 70
5.7 Payment of Taxes.................................................................... 71
5.8 Performance of Agreements; Materially Adverse Agreements............................ 71
5.9 Governmental Regulation............................................................. 71
5.10 Securities Activities............................................................... 72
5.11 Employee Benefit Plans.............................................................. 72
5.12 Certain Fees........................................................................ 73
5.13 Environmental Protection............................................................ 73
5.14 Employee Matters.................................................................... 74
5.15 Solvency............................................................................ 74
5.16 Matters Relating to Collateral...................................................... 74
5.17 Disclosure.......................................................................... 75
5.18 Subordinated Indebtedness........................................................... 75
5.19 Proceeds of Loan.................................................................... 76
Section 6. BORROWER'S AFFIRMATIVE COVENANTS.................................................... 76
6.1 Financial Statements and Other Reports.............................................. 76
6.2 Existence, etc...................................................................... 80
6.3 Payment of Taxes and Claims; Tax.................................................... 80
6.4 Maintenance of Properties; Insurance; Application of Net
Insurance/Condemnation Proceeds..................................................... 80
6.5 Inspection Rights................................................................... 81
6.6 Compliance with Laws, etc........................................................... 82
6.7 Environmental Matters............................................................... 82
ii
6.8 Execution of Subsidiary Guaranty and Personal Property Collateral Documents
After the Closing Date.............................................................. 84
6.9 Redemption of 9.25% First Mortgage Notes............................................ 85
6.10 Qualified Properties................................................................ 85
Section 7. BORROWER'S NEGATIVE COVENANTS....................................................... 85
7.1 Indebtedness; Contingent Obligations................................................ 85
7.2 Liens and Related Matters........................................................... 87
7.3 Investments; Acquisitions; and Restricted Junior Payments........................... 89
7.4 Financial Covenants................................................................. 90
7.5 Restriction on Fundamental Changes.................................................. 92
7.6 Consolidated Capital Expenditures................................................... 93
7.7 Transactions with Shareholders and Affiliates....................................... 93
7.8 Sales and Lease-Backs............................................................... 93
7.9 Conduct of Business................................................................. 93
7.10 Amendments or Waivers of Certain Agreements; Amendments of Documents Relating
to Subordinated Indebtedness........................................................ 94
7.11 Restriction on Leases............................................................... 94
7.12 Fiscal Year......................................................................... 94
7.13 Public Company...................................................................... 94
Section 8. EVENTS OF DEFAULT................................................................... 95
8.1 Failure to Make Payments When Due................................................... 95
8.2 Default in Other Agreements......................................................... 95
8.3 Breach of Certain Covenants......................................................... 95
8.4 Breach of Warranty.................................................................. 95
8.5 Other Defaults Under Loan Documents................................................. 96
8.6 Involuntary Bankruptcy; Appointment of Receiver, etc................................ 96
8.7 Voluntary Bankruptcy; Appointment of Receiver, etc.................................. 96
8.8 Judgments and Attachments........................................................... 97
8.9 Dissolution......................................................................... 97
8.10 Employee Benefit Plans.............................................................. 97
8.11 Change of Control................................................................... 97
iii
8.12 Invalidity of Subsidiary Guaranty; Failure of Security; Repudiation of
Obligations......................................................................... 97
8.13 Uninsured Damage.................................................................... 98
8.14 Loss of Material License............................................................ 98
8.15 Subordinated Indebtedness........................................................... 98
Section 9. ADMINISTRATIVE AGENT................................................................ 99
9.1 Appointment......................................................................... 99
9.2 Powers and Duties; General Immunity................................................ 100
9.3 Representations and Warranties; No Responsibility For Appraisal of
Creditworthiness................................................................... 102
9.4 Right to Indemnity................................................................. 102
9.5 Successor Administrative Agent..................................................... 102
9.6 Collateral Documents and Subsidiary Guaranty....................................... 103
9.7 Administrative Agent May File Proofs of Claim...................................... 104
Section 10. MISCELLANEOUS...................................................................... 104
10.1 Assignments and Participations in Loans and Letters of Credit...................... 104
10.2 Expenses........................................................................... 108
10.3 Indemnity.......................................................................... 109
10.4 Set-Off............................................................................ 110
10.5 Ratable Sharing.................................................................... 110
10.6 Amendments and Waivers............................................................. 111
10.7 Independence of Covenants.......................................................... 112
10.8 Notices; Effectiveness of Signatures............................................... 113
10.9 Survival of Representations, Warranties and Agreements............................. 113
10.10 Failure or Indulgence Not Waiver; Remedies Cumulative.............................. 113
10.11 Marshalling; Payments Set Aside.................................................... 114
10.12 Severability....................................................................... 114
10.13 Obligations Several; Independent Nature of Lenders' Rights......................... 114
10.14 Headings........................................................................... 114
10.15 Applicable Law..................................................................... 115
10.16 Successors and Assigns............................................................. 115
iv
10.17 Consent to Jurisdiction and Service of Process..................................... 115
10.18 Waiver of Jury Trial............................................................... 116
10.19 Confidentiality.................................................................... 116
10.20 Lead Arranger, Bookrunner, Documentation Agent and Syndication Agent............... 117
10.21 Counterparts; Effectiveness........................................................ 117
10.22 Limitation of Liability............................................................ 118
Signature pages S-1
v
EXHIBITS
I FORM OF NOTICE OF BORROWING
II FORM OF NOTICE OF CONVERSION/CONTINUATION
III FORM OF NOTICE OF ISSUANCE OF LETTER OF CREDIT
IV FORM OF TERM NOTE
V FORM OF REVOLVING NOTE
VI FORM OF COMPLIANCE CERTIFICATE
VII FORM OF OPINION OF BORROWER COUNSEL
VIII FORM OF OPINION OF O'MELVENY & XXXXX LLP
IX FORM OF ASSIGNMENT AGREEMENT
X [Reserved.]
XI FORM OF PLEDGE AGREEMENT
XII FORM OF BORROWING BASE CERTIFICATE
XIII FORM OF SUBSIDIARY GUARANTY
XIV FORM OF JOINDER AGREEMENT
vi
SCHEDULES
4.1D CAPITAL STRUCTURE
5.1 SUBSIDIARIES OF BORROWER
5.5 INTELLECTUAL PROPERTY
5.13 ENVIRONMENTAL MATTERS
5.16 INFORMATION REGARDING COLLATERAL
7.1 CERTAIN EXISTING INDEBTEDNESS
7.2 CERTAIN EXISTING LIENS
7.3 CERTAIN EXISTING INVESTMENTS
7.11 EXCLUDED LEASES
vii
PRIME HOSPITALITY CORP.
CREDIT AGREEMENT
This CREDIT AGREEMENT is dated as of July 22, 2002, and
entered into by and among PRIME HOSPITALITY CORP., a Delaware corporation
("Borrower"), THE FINANCIAL INSTITUTIONS LISTED ON THE SIGNATURE PAGES HEREOF OR
PARTY FROM TIME TO TIME HERETO (each individually referred to herein as a
"Lender" and collectively as "Lenders"), and CANADIAN IMPERIAL BANK OF COMMERCE,
acting through one or more of its agencies, branches or affiliates ("CIBC"), as
administrative agent for Lenders (in such capacity, "Administrative Agent"), PNC
BANK, NATIONAL ASSOCIATION and MANUFACTURERS AND TRADERS TRUST COMPANY, as
co-syndication agents (each in such capacity, "CO-SYNDICATION AGENTS") and BEAR
XXXXXXX CORPORATE LENDING, INC., as documentation agent (in such capacity,
"Documentation Agent").
R E C I T A L S
WHEREAS, Lenders, at the request of Borrower, have agreed to
extend certain credit facilities to Borrower in the aggregate initial principal
amount of $125,000,000, the proceeds of which will be used (i) to refinance the
indebtedness of Borrower under the Existing Credit Agreement (capitalized terms
used in these Recitals without definition have the respective meanings assigned
to such terms in Section 1.1) and to pay associated transaction costs, (ii) to
redeem the Borrower's 9.25% First Mortgage Notes in the aggregate principal
amount of approximately $104,000,000 and (iii) to provide financing for working
capital and other general corporate purposes of Borrower and its Subsidiaries;
WHEREAS, Borrower desires to secure all of the Obligations
hereunder and under the other Loan Documents by granting to Administrative
Agent, on behalf of Lenders, a First Priority Lien on all of the Capital Stock
of the Material Subsidiaries;
WHEREAS, the Material Subsidiaries have agreed to guarantee
the Obligations hereunder and under the other Loan Documents and to secure their
guaranties by granting to Administrative Agent, on behalf of Lenders, a First
Priority Lien on all of the Capital Stock of each of their respective Material
Subsidiaries;
WHEREAS, Borrower may increase the original principal amount
of the credit facility contemplated hereby, at Lead Arranger's and Borrower's
mutual discretion, in an aggregate amount of up to $25,000,000 at any time on or
before the date that is thirty days after the Closing Date in accordance with
the terms hereof; and
WHEREAS, Borrower may increase the original principal amount
of the credit facility contemplated hereby further by increasing the Revolving
Loan Commitment or adding a term loan component to the credit facility
contemplated hereby, at Lead Arranger's and Borrower's mutual discretion, in an
aggregate amount of up to $100,000,000 at any time on or before the Revolving
Loan Commitment Termination Date in accordance with the terms hereof;
NOW, THEREFORE, in consideration of the premises and the
agreements, provisions and covenants herein contained, Borrower, Lenders and
Administrative Agent agree as follows:
SECTION 1. DEFINITIONS
1.1 CERTAIN DEFINED TERMS.
The following terms used in this Agreement shall have the
following meanings:
"ADJUSTED LIBOR" means, for any Interest Rate Determination
Date with respect to an Interest Period for a LIBOR Loan, the rate per annum
obtained by dividing (x) the rate of interest equal to (a) the rate per annum
determined on the basis of the rate for deposits in Dollars for a period equal
to such Interest Period commencing on the first day of such Interest Period and
appearing on Telerate Screen 3750 at or about 11:00 A.M., London time, two
Business Days prior to the commencement of such Interest Period, or (b) if such
a rate does not appear on Telerate Screen 3750, the average of the rates per
annum at which Dollar deposits in immediately available funds are offered to
CIBC in the interbank LIBOR market as at or about 10:00 A.M. (New York City
time) two Business Days prior to the beginning of such Interest Period for
delivery on the first day of such Interest Period, and for a period
approximately equal to such Interest Period, by (y) a percentage equal to 100%
minus the stated maximum rate (expressed as a percentage) of all reserve
requirements (including any marginal, emergency, supplemental, special or other
reserves) applicable on such Interest Rate Determination Date to any member bank
of the Federal Reserve System in respect of "Eurocurrency liabilities" as
defined in Regulation D (or any successor category of liabilities under
Regulation D).
"ADMINISTRATIVE AGENT" has the meaning assigned to that term
in the introduction to this Agreement and also includes any successor
Administrative Agent appointed pursuant to subsection 9.5.
"ADMINISTRATIVE AGENT'S OFFICE" means (i) the office of
Administrative Agent located at CIBC, 000 Xxxxxxxxx Xxxxxx, Xxx Xxxx, XX 00000,
or (ii) such other office of Administrative Agent as may from time to time
hereafter be designated as such in a written notice delivered by Administrative
Agent to Borrower and each Lender.
"AFFECTED LENDER" has the meaning assigned to that term in
subsection 2.6C.
"AFFECTED LOANS" has the meaning assigned to that term in
subsection 2.6C.
"AFFILIATE," as applied to any Person, means any other Person
directly or indirectly controlling, controlled by, or under common control with,
that Person. For the purposes of this definition, "control" (including, with
correlative meanings, the terms "controlling," "controlled by" and "under common
control with"), as applied to any Person, means the possession, directly or
indirectly, of the power to direct or cause the direction of the management and
policies of that Person, whether through the ownership of voting securities or
by contract or otherwise. For purposes of this definition, a Person shall be
deemed to be
2
"controlled by" a Person if such Person possesses, directly or
indirectly, power to vote 15% or more of the securities having ordinary voting
power for the election of directors of such Person. Notwithstanding the
foregoing, neither Administrative Agent nor any Lender shall be deemed to be an
Affiliate of any of the Loan Parties.
"AGENTS" means collectively, Administrative Agent and any
documentation agent, syndication agent or other agent appointed under this
Agreement.
"AGREEMENT" means this Credit Agreement dated as of July 22,
2002.
"APPLICABLE BASE RATE MARGIN" means, as at any date of
determination, with respect to any Type of Loan that is a Base Rate Loan, a
percentage per annum equal to the Applicable LIBOR Margin for such Type of Loan
less 1.25%.
"APPLICABLE LIBOR MARGIN" means with respect to (a) Term Loans
that are LIBOR Loans, a percentage per annum as set forth in the document
referred to in subsection 2.1A and (b) Revolving Loans that are LIBOR Loans, a
percentage per annum as set forth below opposite the applicable Consolidated
Total Leverage Ratio:
Revolving Loan
Consolidated Total Leverage Ratio Applicable LIBOR Margin
--------------------------------------------------------------------------
greater than or equal to 4.00 2.75%
less than 4.00:1.00 2.50%
but greater than or equal to 3.50:1.00
less than 3.50:1.00 2.25%
but greater than or equal to 3.00:1.00
less than 3.00:1.00 1.75%
but greater than or equal to 2.50:1.00;
less than 2.50:1.00 1.50%
; provided that until December 31, 2002, the Applicable LIBOR Margin for
Revolving Loans that are LIBOR Loans shall be equal to or greater than 2.25%.
"APPROVED FUND" means any fund that invests (in whole or in
part) in commercial loans or any other fund that is managed or advised by a
Lender, the same investment advisor as such Lender or by an Affiliate of such
Lender or investment advisor.
"ASSET SALE" means the sale (in any single transaction or
related series of transactions) by Borrower or any of its Subsidiaries to any
Person of (i) any of the Capital Stock of any of Borrower's Subsidiaries, (ii)
substantially all of the assets of any division or line of
3
business of Borrower or any of its Subsidiaries, or (iii) any other assets
(whether tangible or intangible) of Borrower or any of its Subsidiaries (other
than (a) sales of assets from Borrower to any Subsidiary Guarantor or from any
Subsidiary Guarantor to Borrower or any other Subsidiary Guarantor and (b) sales
of inventory in the ordinary course of business).
"ASSIGNMENT AGREEMENT" means an Assignment Agreement in
substantially the form of Exhibit IX annexed hereto.
"BANKRUPTCY CODE" means Title 11 of the United States Code
entitled "Bankruptcy".
"BASE RATE" means, at any time, the higher of (i) the
Reference Rate and (ii) the rate which is one-half of 1% in excess of the
Federal Funds Effective Rate.
"BASE RATE LOANS" means Loans bearing interest at rates
determined by reference to the Base Rate as provided in subsection 2.2A.
"BORROWER" has the meaning assigned to that term in the
introduction to this Agreement.
"BORROWING BASE" means the Total Qualified Property EBITDA
multiplied by four (4).
"BORROWING BASE CERTIFICATE" means a certificate substantially
in the form of Exhibit XII annexed hereto delivered to Administrative Agent and
Lenders by Borrower pursuant to subsection 4.1N or subsection 6.1(i).
"BUSINESS DAY" means (i) any day excluding Saturday, Sunday
and any day which is a legal holiday under the laws of the State of New York or
is a day on which banking institutions located in such state are authorized or
required by law or other governmental action to close, and (ii) with respect to
all notices, determinations, fundings and payments in connection with the
Adjusted LIBOR or any LIBOR Loan, any day that (a) is a Business Day described
in clause (i) above, and (b) is a day for trading by and between banks in Dollar
deposits in the London Interbank Market.
"CAPITAL LEASE," as applied to any Person, means any lease
(including Ground Leases) of any property (whether real, personal or mixed) by
that Person as lessee that, in conformity with GAAP, is accounted for as a
capital lease on the balance sheet of that Person.
"CAPITAL STOCK" means (i) in the case of a corporation,
capital stock, (ii) in the case of an association or business entity, any and
all shares, interests, participations, rights or other equivalents (however
designated) of capital stock, (iii) in the case of a partnership, partnership
interests (whether general or limited), (iv) in the case of a limited liability
company, membership interests, and (v) any other interest or participation that
confers on a Person the right to receive a share of the profits and losses of,
or distributions of assets of, the issuing Person.
"CASH" means money, currency or a credit balance in a Deposit
Account.
4
"CASH EQUIVALENTS" means, as at any date of determination, (i)
marketable securities (a) issued or directly and unconditionally guaranteed as
to interest and principal by the United States Government or (b) issued by any
agency of the United States the obligations of which are backed by the full
faith and credit of the United States, in each case maturing within one year
after such date; (ii) marketable direct obligations issued by any state of the
United States of America or any political subdivision of any such state or any
public instrumentality thereof, in each case maturing within one year after such
date and having, at the time of the acquisition thereof, the highest rating
obtainable from either S&P or Xxxxx'x; (iii) commercial paper maturing no more
than one year from the date of creation thereof and having, at the time of the
acquisition thereof, a rating of at least A-2 or the equivalent thereof from S&P
or at least P-2 or the equivalent thereof from Xxxxx'x; (iv) certificates of
deposit or bankers' acceptances maturing within one year after such date and
issued or accepted by any Lender or by any commercial bank organized under the
laws of the United States of America or any state thereof or the District of
Columbia that (a) is at least "adequately capitalized" (as defined in the
regulations of its primary Federal banking regulator) and (b) has Tier 1 capital
(as defined in such regulations) of not less than $100,000,000; and (v) shares
of any money market mutual fund that has at least 95% of its assets invested
continuously in the types of investments referred to in clauses (i) and (ii)
above.
"CHANGE OF CONTROL" means any of the following: (i) the sale,
lease or transfer, in one or a series of related transactions, of all or
substantially all of the Borrower's assets to any person or group (as such term
is used in Section 13(d)(3) of the Exchange Act) other than to a Subsidiary
Guarantor, (ii) the adoption of a plan relating to the liquidation or
dissolution of the Borrower, (iii) the acquisition by any Person or group (as
such term is used in Section 13(d)(3) of the Exchange Act) of a direct or
indirect interest in more than 50% of the ownership of the Borrower or the
voting power of the voting stock of the Borrower by way of purchase, merger or
consolidation or otherwise (other than a creation of a holding company that does
not involve a change in the beneficial ownership of the company as a result of
such transaction), (iv) a change in the Board of Directors of the Borrower in
which the individuals who constituted the Board of Directors of the Borrower or
whose nomination for election by the shareholders of the Borrower was approved
by a vote of at least a majority of the directors then in office either who were
directors at the beginning of such period or whose election or nomination for
election was previously so approved) cease for any reason to constitute a
majority of the directors then in office; and (v) the occurrence of any "Change
of Control" or similar provision as defined in any agreements evidencing
Subordinated Indebtedness when such Subordinated Indebtedness is outstanding.
"CLOSING DATE" means the date on which the conditions
precedent to the making of the initial Revolving Loans set forth in subsection
4.1 are satisfied.
"CO-SYNDICATION AGENTS" has the meaning assigned to that term
in the introduction of this Agreement.
"COLLATERAL" means, collectively, all of the Capital Stock,
limited partnership interests and related rights owned by such Person in any
Material Subsidiary and all proceeds of
5
the foregoing in which Liens are purported to be granted pursuant to the
Collateral Documents as security for the Obligations.
"COLLATERAL DOCUMENTS" means the Pledge Agreement and all
other instruments or documents delivered by any Loan Party pursuant to this
Agreement or any of the other Loan Documents in order to grant to Administrative
Agent, on behalf of Lenders, a Lien on the Capital Stock, the limited
partnership interests and related rights of the Material Subsidiaries and all
proceeds of the foregoing as security for the Obligations.
"COMMITMENTS" means the commitments of Lenders to make Loans
as set forth in subsection 2.1A.
"COMPLIANCE CERTIFICATE" means a certificate substantially in
the form of Exhibit VI annexed hereto delivered to Administrative Agent and
Lenders by Borrower pursuant to subsection 6.1(iv).
"CONSOLIDATED CAPITAL EXPENDITURES" means, for any period, the
sum of the aggregate of all expenditures (whether paid in Cash or other
consideration or accrued as a liability and including that portion of Capital
Leases which is capitalized on the consolidated balance sheet of Borrower and
its Subsidiaries) by Borrower and its Subsidiaries during that period that, in
conformity with GAAP, are included in "additions to property, plant or
equipment" or comparable items reflected in the consolidated statement of cash
flows of Borrower and its Subsidiaries. For purposes of this definition, (a) the
purchase price of equipment that is purchased simultaneously with the trade-in
of existing equipment or with insurance proceeds shall be included in
Consolidated Capital Expenditures only to the extent of the gross amount of such
purchase price less the credit granted by the seller of such equipment for the
equipment being traded in at such time or the amount of such proceeds, as the
case may be, and (b) the aggregate of all expenditures by Borrower and its
Subsidiaries during that period to acquire (by purchase or otherwise) the
business, property or fixed assets of any Person, or the Capital Stock or other
evidence of beneficial ownership of any Person, that, as a result of such
acquisition, becomes a Subsidiary of Borrower shall be included in Consolidated
Capital Expenditures.
"CONSOLIDATED EBITDA" means, for any period, the sum, without
duplication, of the amounts for such period of (i) Consolidated Net Income, (ii)
Consolidated Interest Expense plus deferred financing fees, (iii) provisions for
taxes based on income, (iv) total depreciation expense, (v) total amortization
expense, (vi) pre-opening expenses, (vii) non-cash items classified as valuation
and other charges on the "valuation and other charges" line on the Borrower's
consolidated income statement and (viii) other non-recurring items classified as
other losses on the "other income, net" line on the Borrower's consolidated
income statement, less (i) investment income increasing Consolidated Net Income,
(ii) non-cash items classified as valuation and other gains on the "valuation
and other charges" line on the Borrower's consolidated income statement and
(iii) other non-recurring items classified as other gains on the "other income,
net" line on the Borrower's consolidated income statement, all of the foregoing
as determined on a consolidated basis for Borrower and its Subsidiaries in
conformity with GAAP; provided that for purposes of determining the Consolidated
Total Leverage Ratio or the
6
Consolidated Senior Leverage Ratio for such period, Consolidated EBITDA shall be
calculated on a Pro Forma Basis.
"CONSOLIDATED INTEREST EXPENSE" means, for any period, total
interest expense (including that portion attributable to Capital Leases in
accordance with GAAP and capitalized interest) paid in Cash of Borrower and its
Subsidiaries on a consolidated basis with respect to all outstanding
Indebtedness of Borrower and its Subsidiaries, including all commissions,
discounts and other fees and charges owed with respect to letters of credit and
bankers' acceptance financing and net costs under Interest Rate Agreements less
any deferred financing fees, but excluding, however, (i) any amounts referred to
in subsection 2.3 payable to Administrative Agent and Lenders on or before the
Closing Date and (ii) any amounts related to the Excluded Borrowing.
Consolidated Interest Expense shall be calculated on a Pro Forma Basis.
"CONSOLIDATED NET INCOME" means, for any period, the net
income (or loss) of Borrower and its Subsidiaries on a consolidated basis for
such period taken as a single accounting period determined in conformity with
GAAP, without giving effect to any non-cash losses as a result of impairment of
goodwill as required by Statement of Financial Accounting Standards No. 142;
provided that there shall be excluded (i) the income (or loss) of any Person
(other than a Subsidiary of Borrower) in which any other Person (other than
Borrower or any of its Subsidiaries) has a joint interest, except to the extent
of the amount of dividends or other distributions actually paid to Borrower or
any of its Subsidiaries by such Person during such period, (ii) the income (or
loss) of any Person accrued prior to the date it becomes a Subsidiary of
Borrower or is merged into or consolidated with Borrower or any of its
Subsidiaries or that Person's assets are acquired by Borrower or any of its
Subsidiaries, (iii) the income of any Subsidiary of Borrower to the extent that
the declaration or payment of dividends or similar distributions by that
Subsidiary of that income is not at the time permitted by operation of the terms
of its charter or any agreement, instrument, judgment, decree, order, statute,
rule or governmental regulation applicable to that Subsidiary and (iv) (to the
extent not included in clauses (i) through (iii) above) net extraordinary gains
or extraordinary losses.
"CONSOLIDATED NET WORTH" means, as at any date of
determination, the sum of the Capital Stock and additional paid-in capital plus
retained earnings (or minus accumulated deficits) of Borrower and its
Subsidiaries on a consolidated basis determined in conformity with GAAP, without
giving effect to any non-cash losses as a result of impairment of goodwill as
required by Statement of Financial Accounting Standards No. 142.
"CONSOLIDATED RENTAL PAYMENTS" means, for any period, the
aggregate amount of all rents paid or payable by Borrower and its Subsidiaries
on a consolidated basis during that period under all Operating Leases to which
Borrower or any of Subsidiaries is a party as lessee.
"CONSOLIDATED SENIOR LEVERAGE RATIO" means, as of the last day
of any Fiscal Quarter, the ratio of (i) Consolidated Total Debt less the
Excluded Borrowings and Subordinated Indebtedness on such day and (ii)
Consolidated EBITDA for the four consecutive Fiscal Quarters ending on such day.
7
"CONSOLIDATED TOTAL DEBT" means, as at any date of
determination, the aggregate principal amount of all Indebtedness of Borrower
and its Subsidiaries plus the aggregate principal amount of all Contingent
Obligations of Borrower and its Subsidiaries to the extent such amount exceeds
$50,000,000, determined on a consolidated basis.
"CONSOLIDATED TOTAL LEVERAGE RATIO" means, as of the last day
of any Fiscal Quarter, the ratio of (a) Consolidated Total Debt less the
Excluded Borrowing on such day to (b) Consolidated EBITDA for the four
consecutive Fiscal Quarters ending on such day.
"CONTINGENT OBLIGATION," as applied to Borrower or any
Subsidiary Guarantor, means any direct or indirect liability, contingent or
otherwise, of Borrower or such Subsidiary Guarantor (i) with respect to any
Indebtedness, lease, dividend or other similar obligation of any Person that is
not a Loan Party or other Subsidiary of Borrower (or is a Subsidiary of Borrower
and not a Loan Party, to the extent such obligations are not included in
Consolidated EBITDA) if the primary purpose or intent thereof by the Borrower or
the Subsidiary Guarantor incurring such liability is to provide assurance to the
obligee of such obligation of any Person that is not a Loan Party or other
Subsidiary of Borrower (or is a Subsidiary of Borrower and not a Loan Party, to
the extent such obligations are not included in Consolidated EBITDA) that such
obligation of another will be paid or discharged, or that any agreements
relating thereto will be complied with, or that the holders of such obligation
will be protected (in whole or in part) against loss in respect thereof, (ii)
with respect to Hedge Agreements, or (iii) with respect to the face amount of
all letters of credit (other than Letters of Credit) or bankers' acceptances for
which such Person is obligated to reimburse the related letter of credit or
acceptance bank. Contingent Obligations shall include (a) the direct or indirect
guaranty of the obligation of another, (b) the obligation to make take-or-pay or
similar payments if required regardless of non-performance by any other party or
parties to an agreement, (c) the Indebtedness of any partnership or
unincorporated joint venture to the extent that such Person is liable by
operation of law or pursuant to a guaranty (but specifically excluding any
portion of Indebtedness of any partnership or unincorporated joint venture that
is non-recourse to such Person) and (d) any liability of such Person for the
obligation of another through any agreement (contingent or otherwise) (1) to
purchase, repurchase or otherwise acquire such obligation or any security
therefor, or to provide funds for the payment or discharge of such obligation
(whether in the form of loans, advances, stock purchases, capital contributions
or otherwise) or (2) to maintain the solvency or any balance sheet item, level
of income or financial condition of another if, in the case of any agreement
described under subclause (1) or (2) of this sentence, the primary purpose or
intent thereof is as described in the preceding sentence. The amount of any
Contingent Obligation shall be equal to the amount of the obligation so
guaranteed or otherwise supported or, if less, the amount to which such
Contingent Obligation is specifically limited.
"CONTRACTUAL OBLIGATION," as applied to any Person, means any
provision of any Security issued by that Person or of any Material Contract to
which that Person is a party or by which it or any of its properties is bound or
to which it or any of its properties is subject.
"CURRENCY AGREEMENT" means any foreign exchange contract,
currency swap agreement, futures contract, option contract, synthetic cap or
other similar agreement or arrangement to which Borrower or any of its
Subsidiaries is a party.
8
"DEFAULTING LENDER" has the meaning assigned to that term in
subsection 2.1D.
"DEFAULTED LOAN" has the meaning assigned to that term in
subsection 2.1D.
"DEPOSIT ACCOUNT" means a demand, time, savings, passbook or
like account with a Person or securities intermediary engaged in the business of
banking, including any savings bank, savings and loan association, credit union
or like organization, other than an account evidenced by a negotiable
certificate of deposit.
"DOLLARS" and the sign "$" mean the lawful money of the United
States of America. "DOCUMENTATION AGENT" has the meaning assigned to that term
in the introduction of this Agreement.
"DOMESTIC SUBSIDIARY" means any Subsidiary of Borrower that is
incorporated or organized under the laws of the United States of America, any
state thereof or the District of Columbia.
"8-3/8% SENIOR SUBORDINATED NOTES" means the 8-3/8% Senior
Subordinated Notes due 2012 issued in connection with that certain Indenture
dated as of April 29, 2002, as supplemented by that certain Second Supplemental
Indenture dated as of April 30, 2002.
"ELIGIBLE ASSIGNEE" means (A) (i) a commercial bank organized
under the laws of the United States or any state thereof; (ii) a savings and
loan association or savings bank organized under the laws of the United States
or any state thereof; (iii) a commercial bank organized under the laws of any
other country or a political subdivision thereof (provided that (x) such bank is
acting through a branch or agency located in the United States or (y) such bank
is organized under the laws of a country that is a member of the Organization
for Economic Cooperation and Development or a political subdivision of such
country); and (iv) any other entity which is an "ACCREDITED INVESTOR" (as
defined in Regulation D under the Securities Act) which extends credit or buys
loans as one of its businesses including insurance companies, mutual funds,
lease financing companies and investment funds and any Approved Funds; (B) a
Lender or an Affiliate of a Lender; or (C) any other Person (other than a
natural Person) approved by (1) Administrative Agent, (2) in the case of any
assignment of a Revolving Loan, each Issuing Lender, and (3) unless (x) such
Person is taking delivery of an assignment in connection with physical
settlement of a credit derivatives transaction, or (y) an Event of Default or
Potential Event of Default has occurred and is continuing, Borrower (each such
approval described in clauses (1), (2) and (3) above not to be unreasonably
withheld or delayed); provided that no Affiliate of Borrower shall be an
Eligible Assignee.
"EMPLOYEE BENEFIT PLAN" means any "EMPLOYEE BENEFIT PLAN" as
defined in Section 3.3 of ERISA that is or was maintained or contributed to by
Borrower, any of its Subsidiaries or any of their respective ERISA Affiliates.
9
"ENVIRONMENTAL CLAIM" means any investigation, written notice,
notice of violation, claim, action, suit, proceeding, written demand, abatement
order or other order or directive (conditional or otherwise), by any Government
Authority or any other Person, arising (i) pursuant to or in connection with any
actual or alleged violation of any Environmental Law, (ii) in connection with
any Hazardous Materials or any actual or alleged Hazardous Materials Activity,
or (iii) in connection with any actual or alleged damage, injury, threat or harm
to health, safety, natural resources or the environment.
"ENVIRONMENTAL LAWS" means any and all statutes, ordinances,
orders, rules, regulations, judgments, Governmental Authorizations, or any
other requirements of any Government Authority relating to (i) environmental
matters, including those relating to any Hazardous Materials Activity, (ii) the
generation, use, storage, transportation or disposal of Hazardous Materials, or
(iii) occupational safety and health, industrial hygiene, land use or the
protection of human, plant or animal health or welfare, in any manner
applicable to Borrower or any of its Subsidiaries or any Facility, including
the Comprehensive Environmental Response, Compensation, and Liability Act (42
X.X.X.xx. 9601 et seq.), the Hazardous Materials Transportation Act (49
X.X.X.xx. 1801 et seq.), the Resource Conservation and Recovery Act (42
X.X.X.xx. 6901 et seq.), the Federal Water Pollution Control Act (33 X.X.X.xx.
1251 etseq.), the Clean Air Act (42 X.X.X.xx. 7401 et seq.), the Toxic
Substances Control Act (15 X.X.X.xx. 2601 et seq.), the Federal Insecticide,
Fungicide and Rodenticide Act (7 U.S.C.ss.136 et seq.), the Occupational Safety
and Health Act (29 X.X.X.xx. 651 et seq.), the Oil Pollution Act (33 X.X.X.xx.
2701 et seq.) and the Emergency Planning and Community Right-to-Know Act (42
X.X.X.xx. 11001 et seq.), and any analogous present or future state or local
statutes or laws.
"ERISA" means the Employee Retirement Income Security Act of
1974.
"ERISA AFFILIATE" means, as applied to any Person (i) any
corporation that is a member of a controlled group of corporations within the
meaning of Section 414(b) of the Internal Revenue Code of which that Person is a
member; (ii) any trade or business (whether or not incorporated) that is a
member of a group of trades or businesses under common control within the
meaning of Section 414(c) of the Internal Revenue Code of which that Person is a
member; and (iii) any member of an affiliated service group within the meaning
of Section 414(m) or (o) of the Internal Revenue Code of which that Person, any
corporation described in clause (i) above or any trade or business described in
clause (ii) above is a member. Any former ERISA Affiliate of a Person or any of
its Subsidiaries shall continue to be considered an ERISA Affiliate of such
Person or such Subsidiary within the meaning of this definition with respect to
the period such entity was an ERISA Affiliate of such Person or such Subsidiary
and with respect to liabilities arising after such period for which such Person
or such Subsidiary could be liable under the Internal Revenue Code or ERISA.
"ERISA EVENT" means (i) a "reportable event" within the
meaning of Section 4043 of ERISA and the regulations issued thereunder with
respect to any Pension Plan (excluding those for which the provision for 30-day
notice to the PBGC has been waived by regulation); (ii) the failure to meet the
minimum funding standard of Section 412 of the Internal Revenue Code with
respect to any Pension Plan (whether or not waived in accordance with Section
412(d) of the Internal Revenue Code) or the failure to make by its due date a
required
10
installment under Section 412(m) of the Internal Revenue Code with respect to
any Pension Plan or the failure to make any required contribution to a
Multiemployer Plan; (iii) the provision by the administrator of any Pension Plan
pursuant to Section 4041(a)(2) of ERISA of a notice of intent to terminate such
plan in a distress termination described in Section 4041(c) of ERISA; (iv) the
withdrawal by Borrower, any of its Subsidiaries or any of their respective ERISA
Affiliates from any Pension Plan with two or more contributing sponsors or the
termination of any such Pension Plan resulting in liability pursuant to Section
4063 or 4064 of ERISA; (v) the institution by the PBGC of proceedings to
terminate any Pension Plan, or the occurrence of any event or condition which
might constitute grounds under ERISA for the termination of, or the appointment
of a trustee to administer, any Pension Plan; (vi) the imposition of liability
on Borrower, any of its Subsidiaries or any of their respective ERISA Affiliates
pursuant to Section 4062(e) or 4069 of ERISA or by reason of the application of
Section 4212(c) of ERISA; (vii) the withdrawal of Borrower, any of its
Subsidiaries or any of their respective ERISA Affiliates in a complete or
partial withdrawal (within the meaning of Sections 4203 and 4205 of ERISA) from
any Multiemployer Plan if there is any potential liability therefor, or the
receipt by Borrower, any of its Subsidiaries or any of their respective ERISA
Affiliates of notice from any Multiemployer Plan that it is in reorganization or
insolvency pursuant to Section 4241 or 4245 of ERISA, or that it intends to
terminate or has terminated under Section 4041A or 4042 of ERISA; (viii) the
occurrence of an act or omission which could give rise to the imposition on
Borrower, any of its Subsidiaries or any of their respective ERISA Affiliates of
fines, penalties, taxes or related charges under Chapter 43 of the Internal
Revenue Code or under Section 409, Section 502(c), (i) or (l), or Section 4071
of ERISA in respect of any Employee Benefit Plan; (ix) the assertion of a
material claim (other than routine claims for benefits) against any Employee
Benefit Plan other than a Multiemployer Plan or the assets thereof, or against
Borrower, any of its Subsidiaries or any of their respective ERISA Affiliates in
connection with any Employee Benefit Plan; (x) receipt from the Internal Revenue
Service of notice of the failure of any Pension Plan (or any other Employee
Benefit Plan intended to be qualified under Section 401(a) of the Internal
Revenue Code) to qualify under Section 401(a) of the Internal Revenue Code, or
the failure of any trust forming part of any Pension Plan to qualify for
exemption from taxation under Section 501(a) of the Internal Revenue Code; or
(xi) the imposition of a Lien pursuant to Section 401(a)(29) or 412(n) of the
Internal Revenue Code or pursuant to ERISA with respect to any Pension Plan.
"EVENT OF DEFAULT" means each of the events set forth in
Section 8.
"EXCHANGE ACT" means the Securities Exchange Act of 1934.
"EXCLUDED BORROWING" means, until the 9.25% First Mortgage
Notes are redeemed, a borrowing hereunder made by Borrower of the amount
required (together with other funds of Borrower segregated and identified by the
Borrower on terms acceptable to the Administrative Agent for the sole purpose of
redeeming the 9.25% First Mortgage Notes) to redeem the 9.25% First Mortgage
Notes, made solely for the purpose of redeeming the 9.25% First Mortgage Notes.
"EXCLUDED LEASES" means the leases listed in Schedule 7.12
annexed hereto.
11
"EXISTING CREDIT AGREEMENT" means that certain Amended and
Restated Senior Secured Revolving Credit Agreement, dated as of December 17,
1997, among Borrower, the lenders party thereto and Bankers Trust Company, as
agent.
"FACILITIES" means all hotels, motels, inns, lodges,
conference centers, resorts and similar businesses (including all buildings,
fixtures or other improvements located thereon and all personal property,
whether tangible or intangible, located at or related to the foregoing
properties) now, hereafter or heretofore owned, leased, operated or used by
Borrower or any of its Subsidiaries or any of their respective predecessors or
Affiliates or that are subject to any Franchise Agreements.
"FEDERAL FUNDS EFFECTIVE RATE" means, for any period, a
fluctuating interest rate equal for each day during such period to the weighted
average of the rates on overnight Federal funds transactions with members of the
Federal Reserve System arranged by Federal funds brokers, as published for such
day (or, if such day is not a Business Day, for the next preceding Business Day)
by the Federal Reserve Bank of New York, or, if such rate is not so published
for any day which is a Business Day, the average of the quotations for such day
on such transactions received by Administrative Agent from three Federal funds
brokers of recognized standing selected by Administrative Agent.
"FIRST PRIORITY" means, with respect to any Lien purported to
be created in any Collateral pursuant to any Collateral Document, that (i) such
Lien is perfected and has priority over any other Lien on such Collateral (other
than Permitted Encumbrances) and (ii) such Lien is the only Lien (other than
Liens permitted pursuant to subsection 7.2) to which such Collateral is subject.
"FISCAL QUARTER" means a fiscal quarter of any Fiscal Year.
"FISCAL YEAR" means the fiscal year of Borrower and its
Subsidiaries ending on December 31 of each calendar year.
"FLOOD HAZARD PROPERTY" means any real property located in an
area designated by the Federal Emergency Management Agency as having special
flood or mud slide hazards.
"FRANCHISE AGREEMENTS" means contracts, agreements and other
arrangements between Borrower or its Subsidiaries and Persons who are franchise
owners or operators of Facilities pursuant to which Borrower or its Subsidiaries
receive royalty, service, marketing, reservation and other fees and compensation
in the ordinary course of Borrower's or its Subsidiaries' business.
"FUND" means any Person (other than a natural Person) that is
(or will be) engaged in making, purchasing, holding or otherwise investing in
commercial loans and similar extensions of credit in the ordinary course of its
business.
"FUNDING DATE" means the date of the funding of a Loan.
12
"FUNDING DEFAULT" has the meaning assigned to that term in
subsection 2.1D.
"GAAP" means, subject to the limitations on the application
thereof set forth in subsection 1.2, generally accepted accounting principles
set forth in opinions and pronouncements of the Accounting Principles Board of
the American Institute of Certified Public Accountants and statements and
pronouncements of the Financial Accounting Standards Board or in such other
statements by such other entity as may be approved by a significant segment of
the accounting profession, in each case as the same are applicable to the
circumstances as of the date of determination.
"GOVERNING BODY" means the board of directors or other body
having the power to direct or cause the direction of the management and policies
of a Person that is a corporation, partnership, trust or limited liability
company.
"GOVERNMENT AUTHORITY" means any political subdivision or
department thereof, any other governmental or regulatory body, commission,
central bank, board, bureau, organ or instrumentality or any court, in each case
whether federal, state, local or foreign, and any corporation or other entity
owned or controlled, through stock or capital ownership or otherwise, by any of
the foregoing.
"GOVERNMENTAL AUTHORIZATION" means any permit, license,
registration, authorization, plan, directive, consent, order or consent decree
of or from, or notice to, any Government Authority.
"GROUND LEASE" means any lease for the use of real property.
"HAZARDOUS MATERIALS" means (i) any chemical, material or
substance at any time defined as or included in the definition of "hazardous
substances," "hazardous wastes," "hazardous materials," "extremely hazardous
waste," "acutely hazardous waste," "radioactive waste," "biohazardous waste,"
"pollutant," "toxic pollutant," "contaminant," "restricted hazardous waste,"
"infectious waste," "toxic substances," or any other term or expression intended
to define, list or classify substances by reason of properties harmful to
health, safety or the indoor or outdoor environment (including harmful
properties such as ignitability, corrosivity, reactivity, carcinogenicity,
toxicity, reproductive toxicity, "TCLP toxicity" or "EP toxicity" or words of
similar import under any applicable Environmental Laws); (ii) any oil,
petroleum, petroleum fraction or petroleum derived substance; (iii) any drilling
fluids, produced waters and other wastes associated with the exploration,
development or production of crude oil, natural gas or geothermal resources;
(iv) any flammable substances or explosives; (v) any radioactive materials; (vi)
any asbestos-containing materials; (vii) urea formaldehyde foam insulation;
(viii) electrical equipment which contains any oil or dielectric fluid
containing polychlorinated biphenyls; (ix) pesticides; and (x) any other
chemical, material or substance, exposure to which is prohibited, limited or
regulated by any Government Authority or that may or could pose a hazard to the
health and safety of the owners, occupants or any Persons in the vicinity of any
Facility or to the indoor or outdoor environment.
13
"HAZARDOUS MATERIALS ACTIVITY" means any past, current,
proposed or threatened activity, event or occurrence involving any Hazardous
Materials, including the use, manufacture, possession, storage, holding,
presence, existence, location, Release, threatened Release, discharge,
placement, generation, transportation, processing, construction, treatment,
abatement, removal, remediation, disposal, disposition or handling of any
Hazardous Materials, and any corrective action or response action with respect
to any of the foregoing.
"HEDGE AGREEMENT" means an Interest Rate Agreement or a
Currency Agreement designed to hedge against fluctuations in interest rates or
currency values, respectively.
"INCREASING LENDERS" has the meaning assigned to that term in
subsection 2.1A(i).
"INDEBTEDNESS," as applied to any Person, means, without
duplication, (i) all obligations of such Person for borrowed money, (ii) all
obligations of such Person evidenced by bonds, debentures, notes or similar
instruments, (iii) all obligations of such Person under conditional sale or
other title retention agreements relating to property purchased by such Person
(other than customary reservations or retentions of title under agreements with
suppliers entered into in the ordinary course of business), (iv) that portion of
obligations with respect to Capital Leases that is properly classified as a
liability on a balance sheet in conformity with GAAP, (v) notes payable and
drafts accepted representing extensions of credit whether or not representing
obligations for borrowed money, (vi) any obligation owed for all or any part of
the deferred purchase price of property or services (excluding any such
obligations incurred under ERISA), which purchase price is (a) due more than six
months from the date of incurrence of the obligation in respect thereof or (b)
evidenced by a note or similar written instrument, (vii) all obligations in
respect of any preferred Capital Stock of such Person subject to mandatory
sinking fund payments, redemption or other acceleration, (viii) all indebtedness
secured by any Lien on any property or asset owned or held by that Person
regardless of whether the indebtedness secured thereby shall have been assumed
by that Person or is nonrecourse to the credit of that Person, (ix) the face
amount of all Letters of Credit, and (x) the principal balance outstanding under
any synthetic lease or similar off-balance sheet financing product. Obligations
under Interest Rate Agreements and Currency Agreements constitute (1) in the
case of Hedge Agreements, Contingent Obligations, and (2) in all other cases,
Investments, and in neither case constitute Indebtedness.
"INDEMNITEE" has the meaning assigned to that term in
subsection 10.3.
"INTELLECTUAL PROPERTY" means all patents, patent rights,
patent applications, licenses, inventions, trade secrets, trademarks, trade
names, service marks, copyrights, technology, software, know-how and proprietary
techniques (including processes and substances) used in or necessary for the
conduct of the business of Borrower and its Subsidiaries as currently conducted
that are material to the condition (financial or otherwise), business or
operations of Borrower and its Subsidiaries, taken as a whole.
14
"INTEREST PAYMENT DATE" means (i) with respect to any Base
Rate Loan, the last Business Day of each March, June, September and December of
each year, commencing on the first such date to occur after the Closing Date,
and (ii) with respect to any LIBOR Loan, the last day of each Interest Period
applicable to such Loan; provided that in the case of each Interest Period of
six months, "Interest Payment Date" shall also include the date that is three
months after the commencement of such Interest Period.
"INTEREST PERIOD" has the meaning assigned to that term in
subsection 2.2B.
"INTEREST RATE AGREEMENT" means any interest rate swap
agreement, interest rate cap agreement, interest rate collar agreement or other
similar agreement or arrangement to which Borrower or any of its Subsidiaries is
a party.
"INTEREST RATE DETERMINATION DATE", with respect to any
Interest Period, means the second Business Day prior to the first day of such
Interest Period.
"INTERNAL REVENUE CODE" means the United States Internal
Revenue Code of 1986.
"INVENTORY" means, with respect to any Person as of any date
of determination, all goods, merchandise and other personal property that are
then held by such Person for sale or lease, including raw materials and work in
process.
"INVESTMENT" means (i) any direct or indirect purchase or
other acquisition or commitment to purchase or acquire by Borrower or any of its
Subsidiaries of, or of a beneficial interest in, any Securities of any other
Person (including any Subsidiary of Borrower), (ii) any direct or indirect
redemption, retirement, purchase or other acquisition for value, by any
Subsidiary of Borrower from any Person other than Borrower or any of its
Subsidiaries, of any equity Securities of such Subsidiary, (iii) any direct or
indirect loan, advance (other than advances to employees, officers, consultants,
accountants, attorneys and other advisors and members of the Governing Body of
any Person for moving, entertainment and travel expenses, drawing accounts and
similar expenditures incurred in the ordinary course of business) or capital
contribution by Borrower or any of its Subsidiaries to any other Person (other
than a wholly-owned Subsidiary of Borrower), including all indebtedness and
accounts receivable from that other Person that are not current assets or did
not arise from sales to that other Person in the ordinary course of business, or
(iv) Interest Rate Agreements or Currency Agreements not constituting Hedge
Agreements. The amount of any Investment shall be the original cost of such
Investment plus the cost of all additions thereto, without any adjustments for
increases or decreases in value, or write-ups, write-downs or write-offs with
respect to such Investment (other than adjustments for the repayment of, or the
refund of capital with respect to, the original principal amount of any such
Investment).
"ISSUING LENDER" means, with respect to any Letter of Credit,
the Lender who agrees or is otherwise obligated to issue such Letter of Credit,
determined as provided in subsection 3.1B(ii).
15
"JOINT VENTURE" means a joint venture, partnership or other
similar arrangement, whether in corporate, partnership or other legal form;
provided that in no event shall any corporate Subsidiary of any Person be
considered to be a Joint Venture to which such Person is a party.
"LC REIMBURSEMENT AMOUNT" has the meaning assigned to that
term in subsection 3.3B.
"LEAD ARRANGER" means CIBC World Markets Corp.
"LENDER" and "Lenders" means the Persons identified as
"Lenders" and listed on the signature pages of this Agreement, together with
their successors and permitted assigns pursuant to subsection 10.1; provided
that the term "Lenders," when used in the context of a particular Commitment,
shall mean Lenders having that Commitment.
"LETTER OF CREDIT" or "Letters of Credit" means any standby
letter of credit or similar instrument issued pursuant to subsection 3.1.
"LETTER OF CREDIT USAGE" means, as at any date of
determination, the sum of (i) the maximum aggregate amount that is or at any
time thereafter may become available for drawing under all Letters of Credit
then outstanding plus (ii) the aggregate amount of all drawings under Letters of
Credit honored by Issuing Lenders and not theretofore reimbursed out of the
proceeds of Revolving Loans pursuant to subsection 3.3B or otherwise reimbursed
by Borrower.
"LIBOR LOANS" means Loans bearing interest at rates determined
by reference to the Adjusted LIBOR as provided in subsection 2.2A.
"LIEN" means any lien, mortgage, pledge, assignment, security
interest, charge or encumbrance of any kind (including any conditional sale or
other title retention agreement, any lease in the nature thereof, and any
agreement to give any security interest) and any option, trust or other
preferential arrangement having the practical effect of any of the foregoing.
"LOAN" or "Loans" means one or more of the Term Loans or
Revolving Loans or any combination thereof.
"LOAN DOCUMENTS" means this Agreement, the Notes, the Letters
of Credit (and any applications for, or reimbursement agreements or other
documents or certificates executed by Borrower in favor of an Issuing Lender
relating to, the Letters of Credit), the Subsidiary Guaranty and the Collateral
Documents.
"LOAN PARTY" means each of Borrower and any of Borrower's
Subsidiaries from time to time executing a Loan Document, and "Loan Parties"
means all such Persons, collectively.
"MARGIN STOCK" has the meaning assigned to that term in
Regulation U of the Board of Governors of the Federal Reserve System.
16
"MATERIAL ADVERSE EFFECT" means any act, omission, situation,
circumstance, event or undertaking which could reasonably be expected to have,
singly or in any combination with one or more other acts, omissions, situations,
circumstances, events or undertakings, a materially adverse effect upon (a) the
business, operations, properties, assets, liabilities or condition (financial or
otherwise) of Borrower and the Subsidiary Guarantors taken as a whole, (b) the
enforceability or priority of the security interest in the Collateral, (c) the
respective ability of Borrower or any of the other Loan Parties to perform any
obligations under this Agreement or any other Loan Document to which it is a
party, or (d) the legality, validity, binding effect, or enforceability of any
Loan Document or the material rights or material remedies of Administrative
Agent or Lenders under or in connection with any Loan Document.
"MATERIAL CONTRACT" means any contract, indenture, mortgage,
deed of trust, understanding, undertaking, agreement, instrument or other
arrangement, whether written or oral, to which Borrower or any of its
Subsidiaries is a party (other than the Loan Documents), for which breach,
nonperformance, cancellation or failure to renew could reasonably be expected to
have a Material Adverse Effect.
"MATERIAL LICENSE" means any license, authorization or permit
reasonably determined by Administrative Agent to be of material importance of
Borrower and its Subsidiaries, taken as a whole.
"MATERIAL SUBSIDIARY" means each Domestic Subsidiary now
existing or hereafter acquired or formed by Borrower which, on a consolidated
basis, (i) accounts for more than 7.5% of the consolidated revenues of Borrower
and its Subsidiaries for the most recent Fiscal Year or (ii) as at the end of
such Fiscal Year, is the owner of more than 7.5% of the consolidated assets of
Borrower and its Subsidiaries; provided, however, that Subsidiaries that are not
classified as Material Subsidiaries do not collectively account for more than
15% of the consolidated assets and consolidated revenues of the Borrower and its
Subsidiaries. Roxbury Holding Corp., Landing Holding Corp., Edison Holding
Corp., and Roxbury Prime L.P. shall be deemed Material Subsidiaries.
Notwithstanding anything to the contrary, each of Oradell Holding Corp., a
Delaware corporation, Xxxx Rock Holding Corp., a Delaware corporation, Xxxxxxxx
Holding Corp., a Delaware corporation, Xxxxx Holding Corp., a Delaware
corporation, Secaucus Holding Corp., a Delaware corporation, May-Glen, L.P., a
Delaware limited partnership, and May-Ridge L.P., a Delaware limited
partnership, shall not be deemed to be Material Subsidiaries so long as each
entity does not engage, to a material extent, in any business or activities that
it did not conduct as of the Closing Date. In addition, notwithstanding the
foregoing, if any Subsidiary of Borrower guarantees or becomes liable with
respect to any of Subordinated Indebtedness, such Subsidiary will be deemed a
Material Subsidiary.
17
"MINIMUM AMOUNT" means, with respect to each of the following
actions, the minimum amount and any multiples in excess thereof set forth
opposite such action:
Multiples in
Type of Action Minimum Amount excess thereof
----------------------------------------------- ----------------------- -------------------
Conversion into Base Rate Loans $500,000 $100,000
Conversion into LIBOR Loans $1,000,000 $1,000,000
"Moody's" means Xxxxx'x Investors Service, Inc.
"MULTIEMPLOYER PLAN" means any Employee Benefit Plan that is a
"multiemployer plan" as defined in Section 3(37) of ERISA.
"NET ASSET SALE PROCEEDS" means, with respect to any Asset
Sale, Cash payments (including any Cash received by way of deferred payment
pursuant to, or by monetization of, a note receivable or otherwise, but only as
and when so received) received from such Asset Sale, net of any bona fide direct
costs (including legal fees, accounting fees, appraisals and prepayment
penalties) incurred in connection with such Asset Sale, including (i) income
taxes reasonably estimated to be actually payable within two years of the date
of such Asset Sale as a result of any gain recognized in connection with such
Asset Sale and (ii) payment of the outstanding principal amount of, premium or
penalty, if any, and interest on, any Indebtedness (other than the Loans) that
is secured by a Lien on the stock or assets in question and that is required to
be repaid under the terms thereof as a result of such Asset Sale.
"NET INSURANCE/CONDEMNATION PROCEEDS" means any Cash payments
or proceeds received by Borrower or any of its Subsidiaries (i) under any
casualty insurance policy in respect of a covered loss thereunder or (ii) as a
result of the taking of any assets of Borrower or any of its Subsidiaries by any
Person pursuant to the power of eminent domain, condemnation or otherwise, or
pursuant to a sale of any such assets to a purchaser with such power under
threat of such a taking, in each case net of (a) any actual and reasonable
documented costs incurred by Borrower or any of its Subsidiaries, including
legal fees, in connection with the adjustment or settlement of any claims of
Borrower or such Subsidiary in respect thereof and (b) any Indebtedness secured
by the asset on which cash payments or proceeds have been received.
"NET PROCEEDS AMOUNT" has the meaning assigned to that term in
subsection 2.4B(iii)(d).
"NET SECURITIES PROCEEDS" means the Cash proceeds (net of
underwriting discounts and commissions and other reasonable costs and expenses
associated therewith, including reasonable legal fees and expenses) from the
incurrence of Indebtedness by Borrower or any of its Subsidiaries.
"NEW LENDER" has the meaning assigned to that term in
subsection 2.1A.
18
"9.25% FIRST MORTGAGE NOTES" means the 9.25% First Mortgage
Notes due 2006, issued pursuant to that certain Indenture dated as of January
23, 1996.
"NON-US LENDER" has the meaning assigned to that term in
subsection 2.7B(iii)(a).
"NOTES" means one or more of the Term Notes or Revolving Notes
or any combination thereof.
"NOTICE OF BORROWING" means a notice substantially in the form
of Exhibit I annexed hereto delivered by Borrower to Administrative Agent
pursuant to subsection 2.1B with respect to a proposed borrowing.
"NOTICE OF CONVERSION/CONTINUATION" means a notice
substantially in the form of Exhibit II annexed hereto delivered by Borrower to
Administrative Agent pursuant to subsection 2.2D with respect to a proposed
conversion or continuation of the applicable basis for determining the interest
rate with respect to the Loans specified therein.
"NOTICE OF ISSUANCE OF LETTER OF CREDIT" means a notice
substantially in the form of Exhibit III annexed hereto delivered by Borrower to
Administrative Agent pursuant to subsection 3.1B(i) with respect to the proposed
issuance of a Letter of Credit.
"OBLIGATIONS" means all obligations of every nature of each
Loan Party from time to time owed to Administrative Agent, Lenders or any of
them under the Loan Documents, whether for principal, interest, reimbursement of
amounts drawn under Letters of Credit, fees, expenses, indemnification or
otherwise, whether contingent, direct or otherwise, including post-petition
interest on such amounts accruing subsequent to, and interest that would have
accrued but for, the commencement of a proceeding under the Bankruptcy Code
(whether or not such interest is allowed as a claim in such proceeding).
"OFFICER" means the president, chief executive officer, a vice
president, chief financial officer, treasurer, general partner (if an
individual), managing member (if an individual) or other individual appointed by
the Governing Body or the Organizational Documents of a corporation,
partnership, trust or limited liability company to serve in a similar capacity
as the foregoing.
"OFFICER'S CERTIFICATE," as applied to any Person that is a
corporation, partnership, trust or limited liability company, means a
certificate executed on behalf of such Person by one or more Officers of such
Person or one or more Officers of a general partner or a managing member if such
general partner or managing member is a corporation, partnership, trust or
limited liability company; provided that every Officer's Certificate with
respect to the compliance with a condition precedent to the making of any Loans
hereunder shall include (i) a statement that the Officer or Officers making or
giving such Officer's Certificate have read such condition and any definitions
or other provisions contained in this Agreement relating thereto, (ii) a
statement that, in the opinion of the signers, they have made or have caused to
be made such examination or investigation as is reasonably necessary to enable
them to express an
19
informed opinion as to whether or not such condition has been complied with, and
(iii) a statement as to whether, in the opinion of the signers, such condition
has been complied with.
"OPERATING LEASE," as applied to any Person, means any lease
(including leases that may be terminated by the lessee at any time) of any
property (whether real, personal or mixed) that is not a Capital Lease other
than any such lease under which that Person is the lessor.
"ORGANIZATIONAL DOCUMENTS" means the documents (including
Bylaws, if applicable) pursuant to which a Person that is a corporation,
partnership, trust or limited liability company is organized.
"PARTICIPANT" means a purchaser of a participation in the
rights and obligations under this Agreement pursuant to subsection 10.1C.
"PBGC" means the Pension Benefit Guaranty Corporation or any
successor thereto.
"PENSION PLAN" means any Employee Benefit Plan, other than a
Multiemployer Plan, which is subject to Section 412 of the Internal Revenue Code
or Section 302 of ERISA.
"PERMITTED ENCUMBRANCES" means the following types of Liens
(excluding any such Lien imposed pursuant to Section 401(a)(29) or 412(n) of the
Internal Revenue Code or by ERISA, any such Lien relating to or imposed in
connection with any Environmental Claim, and any such Lien expressly prohibited
by any applicable terms of any of the Collateral Documents):
a) Liens for taxes, assessments or governmental charges
or claims the payment of which is not, at the time,
required by subsection 6.3;
b) statutory Liens of landlords, statutory Liens and
rights of set-off of banks, statutory Liens of
carriers, warehousemen, mechanics, repairmen, workmen
and materialmen, and other Liens imposed by law, in
each case incurred in the ordinary course of business
(a) for amounts not yet overdue or (b) for amounts
that are overdue and that (in the case of any such
amounts overdue) are being contested in good faith by
appropriate proceedings, so long as (1) such reserves
or other appropriate provisions, if any, as shall be
required by GAAP shall have been made for any such
contested amounts, and (2) in the case of a Lien with
respect to any portion of the Collateral, such
contest proceedings conclusively operate to stay the
sale of any portion of the Collateral on account of
such Lien;
c) Liens incurred or deposits made in the ordinary
course of business in connection with workers'
compensation, unemployment insurance and other types
of social security, or to secure the performance of
tenders, statutory obligations, surety and appeal
bonds, bids, leases, government contracts, trade
contracts, performance and return-of-money bonds and
other similar obligations (exclusive of obligations
for the payment of
20
borrowed money), so long as no foreclosure, sale or
similar proceedings have been commenced with respect
to any portion of the Collateral on account thereof;
d) any attachment or judgment Lien not constituting an
Event of Default under subsection 8.8;
e) leases or subleases granted to third parties in
accordance with any applicable terms of the
Collateral Documents and not interfering in any
material respect with the ordinary conduct of the
business of Borrower or any of its Subsidiaries or
resulting in a material diminution in the value of
any Collateral as security for the Obligations;
f) easements, rights-of-way, restrictions,
encroachments, and other minor defects or
irregularities in title, in each case which do not
and will not interfere in any material respect with
the ordinary conduct of the business of Borrower or
any of its Subsidiaries or result in a material
diminution in the value of any Collateral as security
for the Obligations;
g) any (a) interest or title of a lessor or sublessor
under any lease not prohibited by this Agreement, (b)
restriction or encumbrance that the interest or title
of such lessor or sublessor may be subject to, or (c)
subordination of the interest of the lessee or
sublessee under such lease to any restriction or
encumbrance referred to in the preceding clause (b),
so long as the holder of such restriction or
encumbrance agrees to recognize the rights of such
lessee or sublessee under such lease; and
h) Liens arising from filing UCC financing statements
relating solely to leases not prohibited by this
Agreement.
"PERSON" means and includes natural persons, corporations,
limited partnerships, general partnerships, limited liability companies, limited
liability partnerships, joint stock companies, Joint Ventures, associations,
companies, trusts, banks, trust companies, land trusts, business trusts or other
organizations, whether or not legal entities, and governments (whether federal,
state or local, domestic or foreign, and including political subdivisions
thereof) and agencies or other administrative or regulatory bodies thereof.
"PLEDGE AGREEMENT" means the Pledge Agreement executed and
delivered by the Borrower and its Material Subsidiaries on the Closing Date,
substantially in the form of Exhibit XI annexed hereto.
"PLEDGED COLLATERAL" means, collectively, the "Pledged
Collateral" as defined in the Pledge Agreement.
"POTENTIAL EVENT OF DEFAULT" means a condition or event that,
after notice or lapse of time or both, would constitute an Event of Default.
21
"PROCEEDINGS" means any action, suit, proceeding (whether
administrative, judicial or otherwise), governmental investigation or
arbitration.
"PRO FORMA BASIS" means, as of any date of determination, to
the extent so provided for herein, that the compliance by Borrower with the
financial covenants set forth in subsection 7.4 as of the last day of the four
Fiscal Quarter period most recently ended prior to such date of determination
for which the relevant financial information is available (the "Compliance
Period"), will be determined after giving effect on a pro forma basis to any
permitted acquisitions made during such Compliance Period and any permitted
dispositions made during such Compliance Period, other than sales of inventory
in the ordinary course of business, on the following basis:
(i) any Indebtedness incurred or assumed by Borrower or any of
its Subsidiaries and any Indebtedness repaid, each only in connection with such
permitted acquisitions or dispositions, shall be deemed to have been incurred or
repaid, respectively, as of the first day of such Compliance Period;
(ii) if such Indebtedness incurred or assumed by Borrower or
any of its Subsidiaries has a floating or formula rate, then the rate of
interest for such Indebtedness in connection with any such permitted acquisition
or disposition for the applicable period shall be computed as if the rate in
effect for such Indebtedness on the relevant measurement date had been the
applicable rate for the entire applicable period;
(iii) income statement items (whether positive or negative)
attributable to the property or business acquired or disposed of in such
permitted acquisitions or dispositions shall be included or excluded, as
applicable, as if such acquisitions or dispositions took place on the first day
of such Compliance Period on a pro forma basis;
(iv) any Cash received by Borrower or any of its Subsidiaries
that is reinvested in Cash Equivalents shall be deemed to accrue interest for
the entire Compliance Period at the average rate obtained by Borrower and its
Subsidiaries on investments in Cash Equivalents or if no such investment exists,
the Federal Funds Rate, in either case, as of such date of determination and
such amounts shall be added to Consolidated EBITDA for purposes of making pro
forma calculations; and
(v) any historical extraordinary non-recurring costs or
expenses or other verifiable costs or expenses that will not continue after the
acquisition or disposition date may be eliminated and other expenses and cost
reductions may be reflected on a basis consistent with Regulation S-X
promulgated by the Securities and Exchange Commission or as approved by
Administrative Agent.
"PRO RATA SHARE" means (i) with respect to all payments,
computations and other matters relating to the Term Loan Commitment or the Term
Loan of any Lender, the percentage obtained by dividing (x) the Term Loan
Exposure of that Lender by (y) the aggregate Term Loan Exposure of all Lenders;
(ii) with respect to all payments, computations and other matters relating to
the Revolving Loan Commitment or the Revolving Loans of any Lender or any
22
Letters of Credit issued or participations therein purchased by any Lender, the
percentage obtained by dividing (x) the Revolving Loan Exposure of that Lender
by (y) the aggregate Revolving Loan Exposure of all Lenders; and (iii) for all
other purposes with respect to each Lender, the percentage obtained by dividing
(x) the sum of the Term Loan Exposure and the Revolving Loan Exposure of that
Lender by (y) the sum of the aggregate Term Loan Exposure and Revolving Loan
Exposure of all Lenders, in any such case as the applicable percentage may be
adjusted by assignments permitted pursuant to subsection 10.1.
"QUALIFIED PROPERTY" means any hotel property that is (i)
wholly-owned by the Borrower or any Subsidiary Guarantor, (ii) unencumbered,
except for Ground Leases having a remaining term of more than twenty years the
terms of which are otherwise reasonably acceptable to the Administrative Agent,
(iii) managed by the Borrower, a Subsidiary of Borrower or a third party
reasonably acceptable to the Administrative Agent, (iv) operated under a
nationally-recognized brand reasonably acceptable to the Administrative Agent,
(v) located within the United States, (vi) in operation for at least 12 prior
months at the time a Borrowing Base Certificate is delivered to the
Administrative Agent and Lenders, and (vii) in compliance in all material
respects with all applicable Laws and Material Licenses.
"REAL PROPERTY ASSET" means, at any time of determination, any
interest then owned by any Loan Party in any real property.
"REFERENCE RATE" means the rate that CIBC announces from time
to time as its prime lending rate, as in effect from time to time. The Reference
Rate is a reference rate and does not necessarily represent the lowest or best
rate actually charged to any customer. CIBC or any other Lender may make
commercial loans or other loans at rates of interest at, above or below the
Reference Rate.
"REGISTER" has the meaning assigned to that term in subsection
2.1D.
"REGULATION D" means Regulation D of the Board of Governors of
the Federal Reserve System.
"REIMBURSEMENT DATE" has the meaning assigned to that term in
subsection 3.3B.
"RELEASE" means any release, spill, emission, leaking,
pumping, pouring, injection, escaping, deposit, disposal, discharge, dispersal,
dumping, leaching or migration of Hazardous Materials into the indoor or outdoor
environment (including the abandonment or disposal of any barrels, containers or
other closed receptacles containing any Hazardous Materials), including the
movement of any Hazardous Materials through the air, soil, surface water or
groundwater.
"REQUISITE LENDERS" means Lenders having or holding more than
50% of the sum of the aggregate Term Loan Exposures and Revolving Loan Exposures
of all Lenders.
23
"RESTRICTED JUNIOR PAYMENT" means (i) any dividend or other
distribution, direct or indirect, on account of any Capital Stock of any class
of Capital Stock of Borrower or any of its Subsidiaries now or hereafter
outstanding, except a dividend payable solely in shares of that class of Capital
Stock to the holders of that class, a dividend payable by any of Borrower's
Subsidiaries to Borrower or any Subsidiary Guarantor and a dividend payable by
any Subsidiary Guarantor to Borrower or any other Subsidiary Guarantor, (ii) any
redemption, retirement, sinking fund or similar payment, purchase or other
acquisition for value, direct or indirect, of any shares of any class of Capital
Stock of Borrower or any of its Subsidiaries now or hereafter outstanding, (iii)
any payment made to retire, or to obtain the surrender of, any outstanding
warrants, options or other rights to acquire shares of any class of Capital
Stock of Borrower or any of its Subsidiaries now or hereafter outstanding, and
(iv) any payment or prepayment of principal of, premium, if any, or interest on,
or redemption, purchase, retirement, defeasance (including in-substance or legal
defeasance), sinking fund or similar payment with respect to, any Subordinated
Indebtedness.
"REVOLVING LENDER" means a Lender that has a Revolving Loan
Commitment and/or that has an outstanding Revolving Loan.
"REVOLVING LOAN COMMITMENT" means the commitment of a Lender
to make Revolving Loans to Borrower pursuant to subsection 2.1A, and "Revolving
Loan Commitments" means such commitments of all Lenders in the aggregate. The
Revolving Loan Commitments shall be recorded by Administrative Agent in the
Register.
"REVOLVING LOAN COMMITMENT TERMINATION DATE" means July 22,
2006 or any earlier date of termination of the Revolving Loan Commitments.
"REVOLVING LOAN EXPOSURE" means, with respect to any Lender,
as of any date of determination (i) prior to the termination of the Revolving
Loan Commitments, that Lender's Revolving Loan Commitment, and (ii) after the
termination of the Revolving Loan Commitments, the sum of (a) the aggregate
outstanding principal amount of the Revolving Loans of that Lender plus (b) if
that Lender is an Issuing Lender, the aggregate Letter of Credit Usage in
respect of all Letters of Credit issued by that Lender (in each case net of any
participations purchased by other Lenders in such Letters of Credit or in any
unreimbursed drawings thereunder) plus (c) the aggregate amount of all
participations purchased by that Lender in any outstanding Letters of Credit or
any unreimbursed drawings under any Letters of Credit.
"REVOLVING LOANS" means the Loans made by Lenders to Borrower
pursuant to subsection 2.1A.
"REVOLVING NOTES" means (i) the promissory notes of Borrower
issued pursuant to subsection 2.1E on the Closing Date and (ii) any promissory
notes of Borrower issued pursuant to the last paragraph of subsection 2.1A(i) or
2.1A(ii) relating to any increase in Revolving Loan Commitments made pursuant to
subsection 2.1A(i) or 2.1A(ii) and (iii) any promissory notes issued by Borrower
pursuant to subsection 10.1B(i) in connection with assignments of the Revolving
Loan Commitments and Revolving Loans of any Lenders, and any replacements
thereof, in each case substantially in the form of Exhibit V annexed hereto.
24
"S&P" means Standard & Poor's Ratings Group.
"SECURITIES" means any stock, shares, partnership interests,
voting trust certificates, certificates of interest or participation in any
profit-sharing agreement or arrangement, options, warrants, bonds, debentures,
notes, or other evidences of indebtedness, secured or unsecured, convertible,
subordinated or otherwise, or in general any instruments commonly known as
"securities" or any certificates of interest, shares or participations in
temporary or interim certificates for the purchase or acquisition of, or any
right to subscribe to, purchase or acquire, any of the foregoing.
"SECURITIES ACT" means the Securities Act of 1933.
"SOLVENT" means, with respect to any Person, that as of the
date of determination both (A) (i) the then fair saleable value of the property
of such Person is (y) greater than the total amount of liabilities (including
contingent liabilities) of such Person and (z) not less than the amount that
will be required to pay the probable liabilities on such Person's then existing
debts as they become absolute and matured considering all financing alternatives
and potential asset sales reasonably available to such Person; (ii) such
Person's capital is not unreasonably small in relation to its business or any
contemplated or undertaken transaction; and (iii) such Person does not intend to
incur, or believe (nor should it reasonably believe) that it will incur, debts
beyond its ability to pay such debts as they become due; and (B) such Person is
"solvent" within the meaning given that term and similar terms under applicable
laws relating to fraudulent transfers and conveyances. For purposes of this
definition, the amount of any contingent liability at any time shall be computed
as the amount that, in light of all of the facts and circumstances existing at
such time, represents the amount that can reasonably be expected to become an
actual or matured liability.
"SUBORDINATED INDEBTEDNESS" means (i) the 8-3/8% Senior
Subordinated Notes and (ii) any Indebtedness of Borrower incurred from time to
time and subordinated in right of payment to the Obligations if such
Indebtedness (a) bears a market interest rate, (b) has a maturity no earlier
than one year after the Revolving Loan Commitment Termination Date, (c) has a
no-call option that expires no earlier than 120 days after the Revolving Loan
Commitment Termination Date and (d) has other terms and conditions substantially
similar to (or more favorable to Borrower and Lenders than) the 8-3/8% Senior
Subordinated Notes.
"SUBSIDIARY" means, with respect to any Person, any
corporation, partnership, limited liability company, association, joint venture
or other business entity of which more than 50% of the total voting power of
shares of stock or other ownership interests entitled (without regard to the
occurrence of any contingency) to vote in the election of the Person or Persons
(whether directors, managers, trustees or other Persons performing similar
functions) having the power to direct or cause the direction of the management
and policies thereof is at the time owned or controlled, directly or indirectly,
by that Person or one or more of the other Subsidiaries of that Person or a
combination thereof.
25
"SUBSIDIARY GUARANTOR" means any Material Subsidiary that is a
Domestic Subsidiary that executes and delivers a counterpart of the Subsidiary
Guaranty on the Closing Date or from time to time thereafter pursuant to
subsection 6.8.
"SUBSIDIARY GUARANTY" means the Subsidiary Guaranty executed
and delivered by existing Material Subsidiaries that are Domestic Subsidiaries
on the Closing Date and to be executed and delivered by additional Material
Subsidiaries that are Domestic Subsidiaries from time to time thereafter in
accordance with subsection 6.8, substantially in the form of Exhibit XIII
annexed hereto.
"SUPPLEMENTAL COLLATERAL AGENT" has the meaning assigned to
that term in subsection 9.1B.
"TAX" or "Taxes" means any present or future tax, levy,
impost, duty, charge, fee, deduction or withholding of any nature and whatever
called, by whomsoever, on whomsoever and wherever imposed, levied, collected,
withheld or assessed, including interest, penalties, additions to tax and any
similar liabilities with respect thereto; except that, in the case of a Lender,
there shall be excluded taxes that are imposed on the overall net income or net
profits (including franchise taxes imposed in lieu thereof) (i) by the United
States, or (ii) by any other jurisdiction under the laws of which such Lender is
organized or has its principal office or maintains its applicable lending
office, or (iii) by any jurisdiction solely as a result of a present or former
connection between such Lender (other than any such connection arising solely
from such Lender having executed, delivered or performed its obligations or
received a payment under, or enforced any of the Loan Documents) and such
jurisdiction, and (2) any branch profits taxes imposed by the United States or
any similar tax imposed by any other jurisdiction in which such Lender is
located.
"TERM LOAN" means any term loan made by an Increasing Lender
or New Lender to Borrower pursuant to subsection 2.1A(ii).
"TERM LOAN COMMITMENT" means the commitment of an Increasing
Lender or New Lender to make a Term Loan to Borrower pursuant to subsection
2.1A(ii).
"TERM LOAN EXPOSURE", with respect to any Lender, means, as of
any date of determination, (i) prior to the funding of the Term Loans, that
Lender's Term Loan Commitment and (ii) after the funding of the Term Loans, the
outstanding principal amount of the Term Loan of that Lender.
"TERM NOTES" means any promissory notes of Borrower issued
pursuant to the last paragraph of subsection 2.1A(ii) relating to any increase
in Term Loan Commitments made pursuant to subsection 2.1A(ii), any promissory
notes issued by Borrower pursuant to subsection 10.1B(i) in connection with
assignments of the Term Loan Commitments and Term Loans of any Lenders, and any
replacements thereof, in each case substantially in the form of Exhibit IV
annexed hereto.
26
"TOTAL QUALIFIED PROPERTY EBITDA" means, as of any date of
determination, the Consolidated EBITDA for the four consecutive Fiscal Quarter
period then ended, generated by or solely attributable to all Qualified
Properties of Borrower; provided the calculation of Total Qualified Property
EBITDA shall exclude (a) the amount by which the Consolidated EBITDA attributed
to a single Qualified Property exceeds twenty percent (20%) of the amount
determined pursuant to this definition and (b) the amount by which Consolidated
EBITDA attributed to Qualified Properties in a single metropolitan area exceeds
thirty percent (30%) of the amount determined pursuant to this definition.
"TOTAL UTILIZATION OF REVOLVING LOAN COMMITMENTS" means, as at
any date of determination, the sum of (i) the aggregate principal amount of all
outstanding Revolving Loans plus (ii) the Letter of Credit Usage plus (iii)
until such time as the 9.25% First Mortgage Notes are redeemed or the Excluded
Borrowing is made, the amount necessary in order to redeem the outstanding 9.25%
First Mortgage Notes.
"TYPE" means, with respect to any Loan, a Term Loan, or a
Revolving Loan (each of which is a "Type" of Loan).
"UCC" means the Uniform Commercial Code (or any similar or
equivalent legislation) as in effect in any applicable jurisdiction.
1.2 ACCOUNTING TERMS; UTILIZATION OF GAAP FOR PURPOSES OF
CALCULATIONS UNDER AGREEMENT.
Except as otherwise expressly provided in this Agreement, all
accounting terms not otherwise defined herein shall have the meanings assigned
to them in conformity with GAAP. Financial statements and other information
required to be delivered by Borrower to Lenders pursuant to clauses (ii) and
(iii) of subsection 6.1 shall be prepared in accordance with GAAP as in effect
at the time of such preparation (and delivered together with the reconciliation
statements provided for in subsection 6.1(v)). If any changes in accounting
principles from those used in the preparation of the financial statements for
the Fiscal Year ended December 31, 2001 hereafter occasioned by the promulgation
of rules, regulations, pronouncements and opinions by or required by the
Financial Accounting Standards Board of the American Institute of Certified
Public Accountants (or successors thereto or agencies with similar functions)
result in a change in the method of calculation of financial covenants,
standards or terms found in subsection 1.2 and Section 7, the parties hereto
agree to enter into negotiations in order to amend such provisions so as to
equitably reflect such changes with the desired result that the criteria for
evaluating Borrower's financial condition shall be the same after such changes
as if such changes had not been made. Calculations in connection with the
definitions, covenants and other provisions of this Agreement shall utilize GAAP
as in effect on the date of determination, applied in a manner consistent with
that used in preparing the financial statements referred to in subsection 5.3.
Borrower shall deliver to the Administrative Agent at the same time as the
delivery of any annual or quarterly financial statements given in accordance
with the provisions of subsection 6.1, (i) a description in reasonable detail of
any material change in the application of accounting principles employed in the
preparation of such financial statements from those applied in the most recently
preceding quarterly or annual financial statements as to which no
27
objection shall have been made in accordance with the provisions above and (ii)
a reasonable estimate of the effect on such financial statements on account of
such changes in application.
1.3 OTHER DEFINITIONAL PROVISIONS AND RULES OF CONSTRUCTION.
A. Any of the terms defined herein may, unless the
context otherwise requires, be used in the singular or the plural, depending
on the reference.
B. References to "Sections" and "subsections" shall be to
Sections and subsections, respectively, of this Agreement unless otherwise
specifically provided.
C. The use in any of the Loan Documents of the word
"include" or "including," when following any general statement, term or matter,
shall not be construed to limit such statement, term or matter to the specific
items or matters set forth immediately following such word or to similar items
or matters, whether or not nonlimiting language (such as "without limitation" or
"but not limited to" or words of similar import) is used with reference thereto,
but rather shall be deemed to refer to all other items or matters that fall
within the broadest possible scope of such general statement, term or matter.
D. Each of the parties hereto acknowledges that (i) it
has been represented by counsel in the negotiation and documentation of the
terms of this Agreement, (ii) it has had full and fair opportunity to review and
revise the terms of this Agreement, (iii) this Agreement has been drafted
jointly by all of the parties hereto, and (iv) neither Administrative Agent nor
any Lender has any fiduciary relationship with or duty to Borrower arising out
of or in connection with this Agreement or any of the other Loan Documents, and
the relationship between Administrative Agent and Lenders, on the one hand, and
Borrower, on the other hand, in connection herewith or therewith is solely that
of debtor and creditor. Accordingly, each of the parties hereto acknowledges and
agrees that the terms of this Agreement shall not be construed against or in
favor of another party.
E. Any reference in this Agreement or any other Loan
Document to any agreement means such agreement as it may be amended, restated,
supplemented or otherwise modified from time to time; (ii) any reference in this
Agreement or any other Loan Document to any law, statute, regulation, rule or
other legislative action shall mean such law, statute, regulation, rule or other
legislative action as amended, supplemented or otherwise modified from time to
time, and shall include any rule or regulation promulgated thereunder; and (iii)
any reference in this Agreement or any other Loan Document to a Person shall
include the permitted successor or assignee of such Person.
SECTION 2. AMOUNTS AND TERMS OF COMMITMENTS AND LOANS
2.1 COMMITMENTS; MAKING OF LOANS; OPTIONAL NOTES.
A. Commitments. Subject to the terms and conditions of this
Agreement and in reliance upon the representations and warranties of Borrower
herein set forth, each Revolving Lender severally agrees, subject to the
limitations set forth below with respect to the
28
maximum amount of Revolving Loans permitted to be outstanding from time to time,
to lend to Borrower from time to time during the period from the Closing Date to
but excluding the Revolving Loan Commitment Termination Date an aggregate amount
not exceeding its Pro Rata Share of the aggregate amount of the Revolving Loan
Commitments to be used for the purposes identified in subsection 2.6B. The
aggregate original amount of the Revolving Loan Commitments is $125,000,000;
provided that the Revolving Loan Commitments of Revolving Lenders shall be
adjusted to give effect to any assignments of the Revolving Loan Commitments
pursuant to subsection 10.1B and shall be reduced from time to time by the
amount of any reductions thereto made pursuant to subsection 2.4; and provided,
further that the Revolving Loan Commitments of Lenders shall be adjusted to give
effect to any increase in Revolving Loan Commitments pursuant to subsection
2.1A(i) or 2.1A(ii). Each Revolving Lender's Revolving Loan Commitment shall
expire immediately and without further action on the Revolving Loan Commitment
Termination Date and all Revolving Loans and all other amounts owed hereunder
with respect to the Revolving Loans and the Revolving Loan Commitments shall be
paid in full no later than that date; provided that each Revolving Lender's
Revolving Loan Commitment shall expire immediately and without further action on
July 31, 2002, if the initial Revolving Loans have not been made on or before
that date. Amounts borrowed under this subsection 2.1A may be repaid and
reborrowed to but excluding the Revolving Loan Commitment Termination Date.
Anything contained in this Agreement to the contrary
notwithstanding, the Revolving Loans and the Revolving Loan Commitments shall be
subject to the limitation that in no event shall the Total Utilization of
Revolving Loan Commitments at any time exceed the lesser of the Revolving Loan
Commitments then in effect and the Borrowing Base then in effect.
Notwithstanding anything to the contrary contained in this
Agreement, the Borrower may not borrow any Revolving Loans if, after giving
effect to such borrowing and the immediate use of the proceeds (within five
Business Days), Cash and Cash Equivalents will exceed $25,000,000; provided,
however, that any Cash proceeds from the Excluded Borrowing that are segregated
and identified by the Borrower on terms acceptable to the Administrative Agent
for the sole purpose of redeeming the 9.25% First Mortgage Notes shall be
excluded from such calculation.
(i) Increase of the Revolving Loan Commitments. Borrower
may, one time on or prior to thirty (30) days after the Closing Date,
increase, at the Borrower's and Lead Arranger's mutual discretion, the
then effective aggregate principal amount of Revolving Loan
Commitments; provided that (A) the aggregate principal amount of the
increase in the Revolving Loan Commitments pursuant to this subsection
2.1A(i) shall not exceed $25,000,000, (B) Borrower shall execute and
deliver such documents and instruments and take such other actions as
may be reasonably requested by Administrative Agent in connection with
such increase and (C) at the time of any such proposed increase, no
Potential Event of Default or Event of Default shall have occurred and
be continuing or would occur after giving effect to such increase. Any
request under this subsection 2.1A(i) shall be submitted by Borrower to
Administrative Agent, specify the proposed effective date and amount of
such increase and be accompanied by an Officer's Certificate certifying
that no Event of Default or Potential Event of Default exists or will
29
occur as a result of such increase. Borrower may also specify
any fees offered to those Lenders (the "Increasing Lenders") that agree
to increase the principal amount of their applicable Revolving Loan
Commitments which fees may be variable based upon the amount by which
any such Lender is willing to increase the principal amount of its
applicable Revolving Loan Commitment. No Lender shall have any
obligation, express or implied, to offer to increase the aggregate
principal amount of its applicable Revolving Loan Commitment. Only the
consent of each Increasing Lender shall be required for an increase in
the aggregate principal amount of the applicable Revolving Loan
Commitments pursuant to this 2.1A(i). No Lender that declines to
increase the principal amount of its Revolving Loan Commitment may be
replaced in respect of its existing applicable Revolving Loan
Commitment as a result thereof without such Lender's consent.
(ii) Greenshoe. Borrower may, on two occasions prior to the
Revolving Loan Commitment Termination Date, at the Borrower's and Lead
Arranger's mutual discretion, increase the then effective aggregate
principal amount of the Revolving Loan Commitments and/or increase the
Term Loan Commitments; provided that (A) the aggregate principal amount
of the increase in the Revolving Loan Commitment or the Term Loan
Commitments pursuant to this subsection 2.1A(ii) shall not exceed
$100,000,000, (B) Borrower shall execute and deliver such documents and
instruments and take such other actions as may be reasonably requested
by Administrative Agent in connection with such increase, (C) at the
time of any such proposed increase, no Potential Event of Default or
Event of Default shall have occurred and be continuing or would occur
after giving effect to such increase, (D) the Term Loans rank pari
passu with the Revolving Loans, (E) the maturity date of such Term
Loans is no earlier than the Revolving Loan Commitment Termination Date
and (F) the scheduled amortization of the Term Loans shall be no more
than 1.00% of the original principal amount of the Term Loans per annum
until maturity. Any request under this subsection 2.1A(ii) shall be
submitted by Borrower to Administrative Agent, specify the proposed
effective date and amount of such increase and be accompanied by an
Officer's Certificate certifying that no Event of Default or Potential
Event of Default exists or will occur as a result of such increase.
Borrower may also specify any fees offered to those Increasing Lenders
that agree to increase the principal amount of their applicable
Revolving Loan Commitment or Term Loan Commitment, as the case may be,
which fees may be variable based upon the amount by which any such
Lender is willing to increase the principal amount of its applicable
Revolving Loan Commitment or Term Loan Commitment, as the case may be.
No Lender shall have any obligation, express or implied, to offer to
increase the aggregate principal amount of its applicable Revolving
Loan Commitment or Term Loan Commitment, as the case may be. Only the
consent of each Increasing Lender shall be required for an increase in
the aggregate principal amount of the applicable Revolving Loan
Commitment or Term Loan Commitment, as the case may be, pursuant to
this subsection 2.1A(ii). No Lender that declines to increase the
principal amount of its Revolving Loan Commitment or Term Loan
Commitment, as the case may be, may be replaced in respect of its
existing applicable Revolving Loan Commitment or Term Loan Commitment,
as the case may be, as a result thereof without such Lender's consent.
30
Borrower may accept increased amounts or designate new lenders
that qualify as Eligible Assignees and that are reasonably acceptable to
Administrative Agent as additional Lenders hereunder in accordance with
subsections 2.1A(i) and (ii) (each such new lender being a "New Lender"), which
New Lender may assume all or a portion of the increase in the aggregate
principal amount of the applicable Revolving Loan Commitments or Term Loan
Commitments, as the case may be. Borrower and Administrative Agent shall have
discretion jointly to adjust the allocation of the increased aggregate principal
amount of the applicable Revolving Loan Commitments or Term Loan Commitments, as
the case may be, among Increasing Lenders and New Lenders.
Each New Lender designated by Borrower and reasonably
acceptable to Administrative Agent shall become an additional party hereto as a
New Lender concurrently with the effectiveness of the proposed increase in the
aggregate principal amount of the Revolving Loan Commitments or Term Loan
Commitments upon its execution of an instrument of joinder, substantially in the
form attached hereto as Exhibit XIV.
Subject to the foregoing, any increase requested by Borrower
shall be effective as of the date the foregoing actions have been completed and
shall be in a principal amount equal to (i) the principal amount that Increasing
Lenders are willing to assume as increases to the principal amount of their
applicable Term Loan Commitments or Revolving Loan Commitments, as the case may
be, plus (ii) the principal amount offered by New Lenders with respect to the
applicable Term Loan Commitments or Revolving Loan Commitments, as the case may
be, in either case as adjusted by Borrowers and Administrative Agent pursuant to
this subsection 2.1A. Upon effectiveness of any such increase, the Commitments
and Pro Rata Share of each Lender will be adjusted to give effect to the
increase in the applicable Term Loan Commitments or Revolving Loan Commitments,
as the case may be. To the extent that the adjustment of Pro Rata Shares results
in losses or expenses to any Lender as a result of the prepayment of any LIBOR
Loan on a date other than the scheduled last day of the applicable Interest
Period, Borrower shall be responsible for such losses or expenses pursuant to
subsection 2.6D.
If the Term Loan Commitments are increased pursuant to
subsection 2.1A(ii), the Borrower, the Administrative Agent and the Term Loan
Lenders shall enter into a document in form and substance reasonably
satisfactory to the Administrative Agent and the Term Loan Lenders, that will
describe the pricing terms and the amortization schedule of the Term Loans (and
other matters relating to the Term Loans that such parties may agree, not
inconsistent with the terms of this Agreement).
B. BORROWING MECHANICS. Except for Revolving Loans made
on the Closing Date, Revolving Loans made on any Funding Date shall be in an
aggregate minimum amount of $500,000 and integral multiples of $100,000 in
excess of that amount; provided that Revolving Loans made on any Funding Date as
LIBOR Loans with a particular Interest Period shall be in an aggregate minimum
amount of $1,000,000 and integral multiples of $1,000,000 in excess of that
amount. Whenever Borrower desires that Lenders make Revolving Loans, it shall
deliver to Administrative Agent a Notice of Borrowing no later than 10:00 A.M.
(New York City time) at least three Business Days in advance of the proposed
Funding Date (in the case of a LIBOR Loan) or 10:00 A.M. (New York City time) on
the proposed Funding Date (in the case of a Base
31
Rate Loan). The Notice of Borrowing shall specify (i) the proposed Funding Date
(which shall be a Business Day), (ii) the amount and Type of Loans requested,
(iii) in the case of any Loans made on the Closing Date, that such Loans shall
be Base Rate Loans, (iv) in the case of Revolving Loans not made on the Closing
Date, whether such Loans shall be Base Rate Loans or LIBOR Loans, (v) in the
case of any Loans requested to be made as LIBOR Loans, the initial Interest
Period requested therefor and (vi) information about the account of Borrower to
be credited. Revolving Loans may be continued as or converted into Base Rate
Loans and LIBOR Loans in the manner provided in subsection 2.2C.
Borrower shall notify Administrative Agent prior to the
funding of any Loans if any of the matters to which Borrower is required to
certify in the applicable Notice of Borrowing is no longer true and correct as
of the applicable Funding Date, and the acceptance by Borrower of the proceeds
of any Loans shall constitute a re-certification by Borrower, as of the
applicable Funding Date, as to the matters to which Borrower is required to
certify in the applicable Notice of Borrowing.
Except as otherwise provided in subsections 2.6B, 2.6C and
2.6G, a Notice of Borrowing for LIBOR Loan shall be irrevocable once
Administrative Agent receives such notice, and Borrower shall be bound to make a
borrowing in accordance therewith.
C. Disbursement of Funds. All Term Loans and Revolving
Loans under this Agreement shall be made by Lenders simultaneously and
proportionately to their respective Pro Rata Shares, it being understood that
neither Administrative Agent nor any Lender shall be responsible for any default
by any other Lender in that other Lender's obligation to make a Loan requested
hereunder nor shall the Commitment of any Lender to make the particular Type of
Loan requested be increased or decreased as a result of a default by any other
Lender in that other Lender's obligation to make a Loan requested hereunder.
Promptly after receipt by Administrative Agent of a Notice of Borrowing pursuant
to subsection 2.1B Administrative Agent shall notify each Lender for that Type
of Loan of the proposed borrowing. Each such Lender shall make the amount of its
Loan available to Administrative Agent at the Administrative Agent's Office not
later than 12:00 Noon (New York City time) on the applicable Funding Date.
Except to reimburse any Issuing Lender for the amount of a drawing under a
Letter of Credit issued by it, upon satisfaction or waiver of the conditions
precedent specified in subsections 4.1 (in the case of Loans made on the Closing
Date) and 4.2 (in the case of all Loans), Administrative Agent shall make the
proceeds of such Loans available to Borrower on the applicable Funding Date by
causing an amount of same day funds in Dollars equal to the proceeds of all such
Loans received by Administrative Agent from Lenders to be wire transferred to
the account of Borrower as specified in the applicable Notice of Borrowing.
Unless Administrative Agent shall have been notified by any
Lender prior to a Funding Date for any Loans that such Lender does not intend to
make available to Administrative Agent the amount of such Lender's Loan
requested on such Funding Date, Administrative Agent may assume that such Lender
has made such amount available to Administrative Agent on such Funding Date and
Administrative Agent may, in its sole discretion, but shall not be obligated to,
make available to Borrower a corresponding amount on such Funding Date. If such
corresponding amount is not in fact made available to
32
Administrative Agent by such Lender, Administrative Agent shall be entitled to
recover such corresponding amount on demand from such Lender together with
interest thereon, for each day from such Funding Date until the date such amount
is paid to Administrative Agent, at the customary rate set by Administrative
Agent for the correction of errors among banks for three Business Days and
thereafter at the Base Rate. If such Lender does not pay such corresponding
amount forthwith upon Administrative Agent's demand therefor, Administrative
Agent shall promptly notify Borrower and Borrower shall immediately pay such
corresponding amount to Administrative Agent together with interest thereon, for
each day from such Funding Date until the date such amount is paid to
Administrative Agent, at the rate payable under this Agreement for Base Rate
Loans. Nothing in this subsection 2.1C shall be deemed to relieve any Lender
from its obligation to fulfill its Commitments hereunder or to prejudice any
rights that Borrower may have against any Lender as a result of any default by
such Lender hereunder.
D. DEFAULTING LENDERS.
Anything contained herein to the contrary notwithstanding, if
any Lender (a "Defaulting Lender") defaults (a "Funding Default") in its
obligation to fund any Loan (a "Defaulted Loan") in accordance with this
subsection 2.1 or subsection 3.3.C(i), then (i) during any Default Period (as
defined below) with respect to such Defaulting Lender, such Defaulting Lender
shall be deemed not to be a "Lender" for purposes of voting on any matters
(including the granting of any consents or waivers) with respect to any of the
Loan Documents; provided, however, such Defaulting Lender shall be permitted to
vote on any matter, including consents and waivers, that requires the approval
of all the Lenders or an individual Lender pursuant to subsection 10.6(b) or
10.6(c), (ii) to the extent permitted by applicable law, until such time as the
Default Excess (as defined below) with respect to such Defaulting Lender shall
have been reduced to zero, any voluntary prepayment of the Loans pursuant to
subsection 2.4B(i) or any mandatory prepayment of the Loans pursuant to
subsection 2.4B(iii) shall be applied to the Loans such that each Lender shall
receive its Pro Rata Share; provided, however the Defaulting Lender's Pro Rata
Share shall be applied to reduce its Default Excess until reduced to zero, (iii)
such Defaulting Lender's Commitment and outstanding Loans shall be excluded for
purposes of calculating the commitment fee payable to Lenders pursuant to
subsection 2.3A in respect of any day during any Default Period with respect to
such Defaulting Lender, and such Defaulting Lender shall not be entitled to
receive any commitment fee pursuant to subsection 2.3A with respect to such
Defaulting Lender, and (iv) the Total Utilization of Revolving Loan Commitments
as at any date of determination shall be calculated as if such Defaulting Lender
had funded all Defaulted Loans of such Defaulting Lender.
For purposes of this Agreement, (I) "DEFAULT PERIOD" means, with
respect to any Defaulting Lender, the period commencing on the date of the
applicable Funding Default and ending on the earliest of the following dates:
(A) the date on which all Commitments are cancelled or terminated and/or the
Obligations are declared or become immediately due and payable, (B) the date on
which (1) the Default Excess with respect to such Defaulting Lender shall have
been reduced to zero (whether by the funding by such Defaulting Lender of any
Defaulted Loans of such Defaulting Lender or by the non-pro rata application of
any voluntary or mandatory prepayments of the Loans in accordance with the terms
of this subsection 2.1D or by a combination thereof) and (2) such Defaulting
Lender shall have delivered to Borrower and
33
Agent a written reaffirmation of its intention to honor its obligations under
this Agreement with respect to its Commitment, and (C) the date on which
Borrower and Administrative Agent waive all Funding Defaults of such Defaulting
Lender in writing, and (II) "Default Excess" means with respect to any
Defaulting Lender, the excess, if any, of such Defaulting Lender's Pro Rata
Share of the aggregate outstanding principal amount of Loans of all Lenders
(calculated as if all Defaulting Lenders (other than such Defaulting Lender) had
funded all of their respective Defaulted Loans) over the aggregate outstanding
principal amount of Loans of such Defaulting Lender.
No Commitment of any Lender shall be increased or otherwise
affected, and, except as otherwise expressly provided in this subsection 2.1D,
performance by Borrower of its obligations under this Agreement and the other
Loan Documents shall not be excused or otherwise modified, as a result of any
Funding Default or the operation of this subsection 2.1D. The rights and
remedies against a Defaulting Lender under this subsection 2.1D are in addition
to other rights and remedies which Borrower may have against such Defaulting
Lender and with respect to any Funding Default and which Administrative Agent or
any Lender may have against such Defaulting Lender with respect to any Funding
Default.
E. THE REGISTER.
(i) Administrative Agent shall maintain, at its address
referred to in subsection 10.8, a register for the recordation of the
names and addresses of Lenders and the Commitments and Loans of each
Lender from time to time (the "REGISTER"). The Register shall be
available for inspection by Borrower and, as to the information set
forth therein in respect of any Lender, such Lender, in each case at
any reasonable time and from time to time upon reasonable prior notice.
(ii) Administrative Agent shall record in the Register the
Term Loan Commitment, Revolving Loan Commitment, Term Loans and
Revolving Loans from time to time of each Lender and each repayment or
prepayment in respect of the principal amount of the Term Loans or
Revolving Loans of each Lender. Any such recordation shall be prima
facie evidence of such Term Loan Commitment, Revolving Loan Commitment,
Term Loans, Revolving Loans, repayment and prepayment absent manifest
error; provided that failure to make any such recordation, or any error
in such recordation, shall not affect any Lender's Commitments or
Borrower's Obligations in respect of any applicable Loans.
(iii) Each Lender may record on its internal records
(including the Notes held by such Lender) the amount of the Term Loans
and each Revolving Loan made by it and each payment in respect thereof.
Any such recordation shall be prima facie evidence on the amount of the
Term Loans, the Revolving Loans and payment, absent manifest error;
provided that failure to make any such recordation, or any error in
such recordation, shall not affect any Lender's Commitments or
Borrower's Obligations in respect of any applicable Loans; and provided
further that in the event of any inconsistency between the Register and
any Lender's records, the recordations in the Register shall govern
(absent manifest error).
34
(iv) Borrower, Administrative Agent and Lenders shall deem
and treat the Persons listed as Lenders in the Register as the holders
and owners of the corresponding Commitments and Loans listed therein
for all purposes hereof, and no assignment or transfer of any such
Commitment or Loan shall be effective, in each case unless and until an
Assignment Agreement effecting the assignment or transfer thereof shall
have been accepted by Administrative Agent and recorded in the Register
as provided in subsection 10.1B(ii). Prior to such recordation, all
amounts owed with respect to the applicable Commitment or Loan shall be
owed to the Lender listed in the Register as the owner thereof, and any
request, authority or consent of any Person who, at the time of making
such request or giving such authority or consent, is listed in the
Register as a Lender shall be conclusive and binding on any subsequent
holder, assignee or transferee of the corresponding Commitments or
Loans.
(v) Borrower hereby designates CIBC to serve as Borrower's
agent solely for purposes of maintaining the Register as provided in
this subsection 2.1D, and Borrower hereby agrees that, to the extent
CIBC serves in such capacity, CIBC and its officers, directors,
employees, agents and Affiliates shall constitute Indemnitees for all
purposes under subsection 10.3.
F. NOTES. Borrower shall execute and deliver on the
Closing Date to each Lender that requests a Revolving Note (or to Administrative
Agent for that Lender if requested by such Lender) a Revolving Note
substantially in the form of Exhibit V annexed hereto to evidence that Lender's
Revolving Loans, in the principal amount of that Lender's Revolving Loan
Commitment and with other appropriate insertions.
Administrative Agent may deem and treat the payee of any Note
as the owner thereof for all purposes hereof unless and until an Assignment
Agreement effecting the assignment or transfer thereof shall have been accepted
by Administrative Agent as provided in subsection 10.1B(ii). Any request,
authorization or consent of any person or entity who, at the time of making such
request or giving such authority or consent, is the holder of any Note shall be
conclusive and binding on any subsequent holder, assignee or transferee of that
Note or of any Note or Notes issued in exchange therefor.
If Borrower increases the aggregate principal amount of the
Revolving Loan Commitments pursuant to subsection 2.1A(i) or 2.1A(ii), Borrower
shall issue replacement Revolving Notes to each Increasing Lender (or to
Administrative Agent for such Increasing Lender) and new Revolving Notes to each
New Lender (or to Administrative Agent for such New Lender). If the Borrower
increases the Term Loan Commitments pursuant to subsection 2.1A(ii), Borrower
shall issue new Term Loan Notes to each Increasing Lender or New Lender with a
Term Loan Commitment.
2.2 INTEREST ON THE LOANS.
A. Rate of Interest. Subject to the provisions of
subsections 2.6 and 2.7, each Term Loan and Revolving Loan shall bear interest
on the unpaid principal amount thereof from the date made through maturity
(whether by acceleration or otherwise) at a rate determined
35
by reference to the Base Rate or Adjusted LIBOR. The applicable basis for
determining the rate of interest with respect to any Term Loan and Revolving
Loan shall be selected by Borrower initially at the time a Notice of Borrowing
is given with respect to such Loan pursuant to subsection 2.1B, and the basis
for determining the interest rate with respect to any Term Loan or any Revolving
Loan may be changed from time to time pursuant to subsection 2.2D. If on any day
a Term Loan or Revolving Loan is outstanding with respect to which notice has
not been delivered to Administrative Agent in accordance with the terms of this
Agreement specifying the applicable basis for determining the rate of interest,
then for that day that Loan shall bear interest determined by reference to the
Base Rate.
Subject to the provisions of subsections 2.2E and 2.7, the
Revolving Loans shall bear interest through maturity as follows:
(i) if a Base Rate Loan, then at the sum of the Base Rate
plus the Applicable Base Rate Margin for such Type of Loans; or
(ii) if a LIBOR Loan, then at the sum of Adjusted LIBOR
plus the Applicable LIBOR Margin for such Type of Loans.
Upon delivery of a Compliance Certificate by Borrower to
Administrative Agent the Applicable Base Rate Margin and Applicable LIBOR Margin
shall automatically be adjusted in accordance with such Compliance Certificate,
such adjustment to become effective on the third Business Day after delivery of
such Compliance Certificate; provided that (1) at any time a Compliance
Certificate is not delivered at the time required from the time such Compliance
Certificate was required to be delivered until delivery of such Compliance
Certificate, the Applicable Base Rate Margin shall be 1.50% for the Revolving
Loans and the Applicable LIBOR Margin shall be 2.75% for the Revolving Loans,
and (2) if a Compliance Certificate erroneously indicates an applicable margin
more favorable to Borrower than should be afforded by the actual calculation of
the Consolidated Total Leverage Ratio, Borrower shall promptly pay additional
interest and letter of credit fees to correct for such error.
B. INTEREST PERIODS. In connection with each LIBOR Loan,
Borrower may, pursuant to the applicable Notice of Borrowing or Notice of
Conversion/Continuation, as the case may be, select an interest period (each an
"Interest Period") to be applicable to such Loan, which Interest Period shall
be, at Borrower's option, either a one, two, three or six month period; provided
that:
(i) the initial Interest Period for any LIBOR Loan shall
commence on the Funding Date in respect of such Loan, in the case of a
Loan initially made as a LIBOR Loan, or on the date specified in the
applicable Notice of Conversion/Continuation, in the case of a Loan
converted to a LIBOR Loan;
(ii) in the case of immediately successive Interest Periods
applicable to a LIBOR Loan continued as such pursuant to a Notice of
Conversion/Continuation, each successive Interest Period shall commence
on the day on which the next preceding Interest Period expires;
36
(iii) if an Interest Period would otherwise expire on a day
that is not a Business Day, such Interest Period shall expire on the
next succeeding Business Day; provided that, if any Interest Period
would otherwise expire on a day that is not a Business Day but is a day
of the month after which no further Business Day occurs in such month,
such Interest Period shall expire on the next preceding Business Day;
(iv) any Interest Period that begins on the last Business
Day of a calendar month (or on a day for which there is no numerically
corresponding day in the calendar month at the end of such Interest
Period) shall, subject to clause (v) of this subsection 2.2B, end on
the last Business Day of a calendar month;
(v) no Interest Period with respect to any portion of the
Revolving Loans shall extend beyond the Revolving Loan Commitment
Termination Date;
(vi) no Interest Period with respect to Term Loans shall
extend beyond a date on which Borrower is required to make a scheduled
payment of principal of such Term Loans, unless the sum of (a) the
aggregate principal amount of such Term Loans that are Base Rate Loans
plus (b) the aggregate principal amount of Term Loans that are LIBOR
Loans with Interest Periods expiring on or before such date equals or
exceeds the principal amount required to be paid on such Term Loans on
such date;
(vii) no Interest Period with respect to any portion of the
Revolving Loans shall extend beyond the date on which a permanent
reduction of the Revolving Loan Commitments is scheduled to occur
unless the sum of (a) the aggregate principal amount of Revolving Loans
that are Base Rate Loans plus (b) the aggregate principal amount of
Revolving Loans that are LIBOR Loans with Interest Periods expiring on
or before such date plus (c) the excess of the Revolving Loan
Commitments then in effect over the aggregate principal amount of
Revolving Loans then outstanding equals or exceeds the permanent
reduction of the Revolving Loan Commitments that is scheduled to occur
on such date;
(viii) there shall be no more than eight Interest Periods
outstanding at any time; and
(ix) if Borrower fails to specify an Interest Period for
any LIBOR Loan in the applicable Notice of Borrowing or Notice of
Conversion/Continuation, Borrower shall be deemed to have selected an
Interest Period of one month.
C. INTEREST PAYMENTS. Subject to the provisions of subsection
2.2E, interest on each Loan shall be payable in arrears on and to each Interest
Payment Date applicable to that Loan, upon any prepayment of that Loan (to the
extent accrued on the amount being prepaid) and at maturity (including final
maturity) provided that if any Revolving Loans that are Base Rate Loans are
prepaid pursuant to subsection 2.4B(i), interest accrued on such Loans through
the date of such prepayment shall be payable on the next succeeding Interest
Payment Date applicable to Base Rate Loans (or, if earlier, at final maturity).
37
D. CONVERSION OR CONTINUATION.
(i) Subject to the provisions of subsection 2.7, Borrower
shall have the option (i) to convert at any time all or any part of its
outstanding Term Loans or Revolving Loans from Loans bearing interest
at a rate determined by reference to one basis to Loans bearing
interest at a rate determined by reference to an alternative basis, in
each case in the applicable Minimum Amount therefor, or (ii) upon the
expiration of any Interest Period applicable to a LIBOR Loan, to
continue all or any portion of such Loan equal to $1,000,000 and
integral multiples of $1,000,000 in excess of that amount as a LIBOR
Loan; provided, however, that a LIBOR Loan may only be converted into a
Base Rate Loan on the expiration date of an Interest Period applicable
thereto.
(ii) Borrower shall deliver a Notice of
Conversion/Continuation to Administrative Agent no later than 10:00 AM
(New York City time) at least three Business Days in advance of the
proposed conversion date (in the case of a conversion to a Base Rate
Loan) and at least three Business Days in advance of the proposed
conversion/continuation date (in the case of a conversion to, or a
continuation of, a LIBOR Loan). With respect to any LIBOR Loan, if
Borrower fails to deliver a Notice of Conversion/Continuation as
described above or if any proposed conversion/continuation under this
subsection 2.2D is not permitted hereunder, Borrower shall be deemed to
have elected to convert such LIBOR Loan to a Base Rate Loan on the last
day of the then-expiring Interest Period.
(iii) A Notice of Conversion/Continuation shall specify (a)
the proposed conversion/continuation date (which shall be a Business
Day), (b) the amount and Type of the Loan to be converted/continued,
(c) the nature of the proposed conversion/continuation, (d) in the case
of a conversion to, or a continuation of, a LIBOR Loan, the requested
Interest Period (which, if a Potential Event of Default has occurred
and is continuing shall be a one month Interest Period), and (e) in the
case of a conversion to, or a continuation of, a LIBOR Loan, that no
Event of Default has occurred and is continuing. Upon receipt of
written notice of any proposed conversion/continuation under this
subsection 2.2D, Administrative Agent shall promptly transmit such
notice by facsimile or electronic mail (or by telephone promptly
confirmed by facsimile or electronic mail) to each Lender.
(iv) Except as otherwise provided in subsections 2.6B, 2.6C
and 2.6G, a notice of a proposed conversion to, or continuation of, a
LIBOR Loan (whether by delivery of a Notice of Conversion/Continuation
or telephonic notice) shall be irrevocable once Administrative Agent
receives such notice, and Borrower shall be bound to effect a
conversion or continuation in accordance therewith.
E. OVERDUE INTEREST. Any principal payments on the Loans
(whether Base Rate Loans or LIBOR Loans) not paid when due and, to the extent
permitted by applicable law, any interest payments on the Loans or any fees or
other amounts owed hereunder not paid when due, in each case whether at stated
maturity, by notice of prepayment, by acceleration or otherwise, shall
thereafter bear interest (including post-petition interest in any proceeding
under
38
the Bankruptcy Code or other applicable bankruptcy laws) from the date of such
non-payment until such amount is paid in full and payable on demand at a rate
that is 2.00% per annum in excess of the highest interest rate otherwise payable
under the pricing grid contained in this Agreement for Base Rate Loans; provided
that, in the case of LIBOR Loans, upon the expiration of the Interest Period in
effect at the time any such increase in interest rate is effective such LIBOR
Loans shall thereupon become Base Rate Loans. Payment or acceptance of the
increased rates of interest provided for in this subsection 2.2E is not a
permitted alternative to timely payment and shall not constitute a waiver of any
Event of Default or otherwise prejudice or limit any rights or remedies of
Administrative Agent or any Lender.
F. COMPUTATION OF INTEREST. Interest on the Loans and
other Obligations shall be computed (i) in the case of Base Rate Loans, on the
basis of a 365-day year, and (ii) in the case of LIBOR Loans and other
Obligations (other than Base Rate Loans), on the basis of a 360-day year, in
each case for the actual number of days elapsed in the period during which it
accrues. In computing interest on any Loan, the date of the making of such Loan
or the first day of an Interest Period applicable to such Loan or, with respect
to a Base Rate Loan being converted from a LIBOR Loan, the date of conversion of
such LIBOR Loan to such Base Rate Loan, as the case may be, shall be included,
and the date of payment of such Loan or the expiration date of an Interest
Period applicable to such Loan or, with respect to a Base Rate Loan being
converted to a LIBOR Loan, the date of conversion of such Base Rate Loan to such
LIBOR Loan, as the case may be, shall be excluded; provided that if a Loan is
repaid on the same day on which it is made, one day's interest shall be paid on
that Loan.
G. Maximum Rate. Notwithstanding the foregoing provisions
of this subsection 2.2, in no event shall the rate of interest payable by
Borrower with respect to any Loan exceed the maximum rate of interest permitted
to be charged under applicable law.
2.3 FEES.
A. REVOLVING LOAN COMMITMENT FEES. Borrower agrees to pay
to Administrative Agent, for distribution to each Lender in proportion to that
Lender's Pro Rata Share of the Revolving Loan Commitments, commitment fees for
the period from and including the Closing Date to and excluding the Revolving
Loan Commitment Termination Date equal to the average of the daily excess of the
Revolving Loan Commitments over the sum of (i) the aggregate principal amount of
outstanding Revolving Loans plus (ii) the Letter of Credit Usage multiplied by
one half of 1% per annum, such commitment fees to be calculated on the basis of
a 360-day year and the actual number of days elapsed and to be payable quarterly
in arrears on the last Business Day of each March, June, September and December
of each year, commencing on the first such date to occur after the Closing Date,
and on the Revolving Loan Commitment Termination Date.
B. OTHER FEES. Borrower agrees to pay to Lead Arranger
and Administrative Agent such fees in the amounts and at the times separately
agreed upon among Borrower, Lead Arranger and Administrative Agent.
39
2.4 Repayments, Prepayments and Reductions in Revolving Loan
Commitments; General Provisions Regarding Payments;
Application of Proceeds of Collateral and Payments Under
Subsidiary Guaranty.
A. SCHEDULED PAYMENTS OF TERM LOANS.
The Borrower shall repay the Term Loans pursuant to the
amortization schedule contained in the agreement referred to in
subsection 2.1A.
B. PREPAYMENTS AND UNSCHEDULED REDUCTIONS IN REVOLVING
LOAN COMMITMENTS.
(i) Voluntary Prepayments. Borrower may, upon not less
than one Business Day's irrevocable prior written notice, in the case
of Base Rate Loans, and three Business Days' irrevocable prior written
notice, in the case of LIBOR Loans, in each case given to
Administrative Agent by 12:00 Noon (New York City time) on the date
required (which written notice Administrative Agent will promptly
transmit by facsimile or electronic mail to each Lender for the Loans
to be prepaid), at any time and from time to time prepay any Loans on
any Business Day in whole or in part in an aggregate minimum amount of
$1,000,000 and integral multiples of $100,000 in excess of that amount;
provided, however, that any LIBOR Loan may be prepaid on a day other
than the expiration of the Interest Period applicable thereto only if
Borrower pays the amounts due pursuant to subsection 2.6D caused by
such prepayment. Notice of prepayment having been given as aforesaid,
the principal amount of the Loans specified in such notice shall become
due and payable on the prepayment date specified therein. Any such
voluntary prepayment shall be applied as specified in subsection
2.4B(iv).
(ii) Voluntary Reductions of Revolving Loan Commitments.
Borrower may, upon not less than five Business Days' irrevocable prior
written notice to Administrative Agent (which written notice
Administrative Agent will promptly transmit by facsimile or electronic
mail to each Lender), at any time and from time to time terminate in
whole or permanently reduce in part, without premium or penalty, the
Revolving Loan Commitments in an amount up to the amount by which the
Revolving Loan Commitments exceed the Total Utilization of Revolving
Loan Commitments at the time of such proposed termination or reduction;
provided that any such partial reduction of the Revolving Loan
Commitments shall be in an aggregate minimum amount of $1,000,000 and
integral multiples of $100,000 in excess of that amount. Borrower's
notice to Administrative Agent shall designate the date (which shall be
a Business Day) of such termination or reduction and the amount of any
partial reduction, and such termination or reduction of the Revolving
Loan Commitments shall be effective on the date specified in Borrower's
notice and shall reduce the Revolving Loan Commitment of each Revolving
Lender proportionately to its Pro Rata Share. Any such voluntary
reduction of the Revolving Loan Commitments shall be applied as
specified in subsection 2.4B(iv).
(iii) Mandatory Prepayments and Mandatory Reductions of
Revolving Loan Commitments. If at the time of any potential prepayment
described below, the
40
Borrower's Consolidated Total Leverage Ratio exceeds 3.50 to 1.00
(based on the most recently delivered Compliance Certificate), the
Loans shall be prepaid and/or the Revolving Loan Commitments shall be
permanently reduced in the amounts and under the circumstances set
forth below, all such prepayments and/or reductions to be applied as
set forth below or as more specifically provided in subsection
2.4B(iv):
(a) Prepayments and Reductions From Net Asset Sale
Proceeds. No later than 366 days after the date of receipt by
Borrower or any of its Subsidiaries of any Net Asset Sale
Proceeds in excess of $10,000,000 in respect of any individual
or series of related Asset Sales that are not reinvested
within the 365-day period after receipt for the expansion,
development or improvement, renovation, acquisition or
construction of Facilities and related businesses or applied
to repay secured Indebtedness, Borrower shall either prepay
the Loans and/or the Revolving Loan Commitments shall be
permanently reduced in an aggregate amount equal to such Net
Asset Sale Proceeds in excess of $10,000,000.
(b) Prepayments and Reductions from Net
Insurance/Condemnation Proceeds. No later than 366 days after
the date of receipt by Borrower or any of its Subsidiaries of
any Net Insurance/Condemnation Proceeds that are not
reinvested for the repair and restoration or replacement of
the applicable or comparable property within the 365-day
period after the receipt, Borrower shall either prepay the
Loans and/or the Revolving Loan Commitments shall be
permanently reduced in an aggregate amount equal to such Net
Insurance/Condemnation Proceeds.
(c) Prepayments and Reductions Due to Issuance of
Indebtedness. On the date of receipt of the Net Securities
Proceeds by Borrower or any of its Subsidiaries after the
Closing Date, other than from (a) refinancings of existing
Indebtedness, (b) Indebtedness with respect to the
Obligations, (c) Indebtedness, the proceeds of which are used
within 120 days for acquisitions permitted by subsection 7.3,
(d) Indebtedness assumed in connection with the acquisitions
permitted by subsection 7.3 and (e) Indebtedness constituting
purchase money debt (including Indebtedness issued to finance
the acquisition of furniture, fixtures and equipment),
Borrower shall prepay the Loans and/or the Revolving Loan
Commitments shall be permanently reduced in an aggregate
amount equal to 50% of such Net Securities Proceeds.
(d) Calculations of Net Proceeds Amounts; Additional
Prepayments and Reductions Based on Subsequent Calculations.
Concurrently with any prepayment of the Loans and/or reduction
of the Revolving Loan Commitments pursuant to subsections
2.4B(iii)(a)-(c), Borrower shall deliver to Administrative
Agent an Officer's Certificate demonstrating the calculation
of the amount (the "Net Proceeds Amount") of the applicable
Net Asset Sale Proceeds, Net Insurance/Condemnation Proceeds
or Net Securities Proceeds, as the case may be, that gave rise
to such prepayment and/or reduction. If Borrower subsequently
41
determines that the actual Net Proceeds Amount was greater
than the amount set forth in such Officer's Certificate
(including if any actual taxes to be paid as a result of an
Asset Sale is less than the estimated taxes to be paid as a
result of such Asset Sale), Borrower shall promptly make an
additional prepayment of the Loans (and/or, if applicable, the
Revolving Loan Commitments shall be permanently reduced) in an
amount equal to the amount of such excess, and Borrower shall
concurrently therewith deliver to Administrative Agent an
Officer's Certificate demonstrating the derivation of the
additional Net Proceeds Amount resulting in such excess.
(e) Prepayments Due to Reductions or Restrictions of
Revolving Loan Commitments. Borrower shall from time to time
prepay first the Revolving Loans to the extent necessary so
that the Total Utilization of Revolving Loan Commitments shall
not at any time exceed the lesser of the Revolving Loan
Commitments or the Borrowing Base then in effect and second to
cash collateralize any outstanding Letters of Credit.
(iv) Application of Prepayments.
(a) Application of Voluntary Prepayments by Type of
Loans. Unless an Event of Default has occurred and is
continuing, subject to the provisions of subsection 2.4D, any
voluntary prepayments pursuant to subsection 2.4B(i) shall be
applied as among the Types of Loans as specified by Borrower
in the applicable notice of prepayment; provided that if
Borrower fails to specify the Loans to which any such
prepayment shall be applied such prepayment shall be applied
first to repay outstanding Term Loans to the full extent
thereof, second to repay outstanding Revolving Loans to the
full extent thereof and the Revolving Loan Commitments shall
be permanently reduced by the amount of such prepayment and
third to cash collateralize any outstanding Letters of Credit.
(b) Application of Mandatory Prepayments by Type of
Loans. Subject to the provisions of subsection 2.4D, any
amount (the "Applied Amount") required to be applied as a
mandatory prepayment of the Loans and/or a reduction of the
Revolving Loan Commitments pursuant to subsections
2.4B(iii)(a)-(c) shall be applied, first, to prepay the Term
Loans to the full extent thereof, second, to the extent of any
remaining portion of the Applied Amount, to prepay the
Revolving Loans to the full extent thereof and to cash
collateralize any outstanding Letters of Credit and the
Revolving Loan Commitments shall be permanently reduced by the
amount of such prepayment, and, third, to the extent of any
remaining portion of such amount, to further permanently
reduce the Revolving Loan Commitments to the full extent
thereof.
(c) Application of Prepayments of Term Loans . Any
amount required to be applied as a voluntary or mandatory
prepayment of the Term Loans shall be applied to the Term
Loans and shall be applied to scheduled installments of
42
principal of the Term Loans on a pro rata basis without regard
to the order of maturity.
(d) Application of Prepayments to Base Rate Loans and
LIBOR Loans. Considering Term Loans and Revolving Loans being
prepaid separately, any prepayment thereof shall be applied
first to Base Rate Loans to the full extent thereof before
application to LIBOR Loans, in each case in a manner which
minimizes the amount of any payments required to be made by
Borrower pursuant to subsection 2.6D.
C. GENERAL PROVISIONS REGARDING PAYMENTS.
(i) Manner and Time of Payment. All payments by Borrower of
principal, interest, fees and other Obligations hereunder and under the
Notes shall be made in Dollars in same day funds, without defense,
setoff or counterclaim, free of any restriction or condition, and
delivered to Administrative Agent not later than 12:00 Noon (New York
City time) on the date due at the Administrative Agent's Office for the
account of Lenders; funds received by Administrative Agent after that
time on such due date shall be deemed to have been paid by Borrower on
the next succeeding Business Day. Borrower hereby authorizes
Administrative Agent to charge its accounts with Administrative Agent
in order to cause timely payment to be made to Administrative Agent of
all principal, interest, fees and expenses due hereunder (subject to
sufficient funds being available in its accounts for that purpose).
(ii) Application of Payments. Prior to any payments being
applied to principal or interest under this Agreement or under the
Notes, such payments shall first be applied to any outstanding and
payable fees, costs, expenses, indemnities or other amounts (aside from
principal or interest due under the Loan Documents), as determined in
the reasonable opinion of Administrative Agent.
(iii) Application of Payments to Principal and Interest.
Except as provided in subsection 2.2C, all payments in respect of the
principal amount of any Loan shall include payment of accrued interest
on the principal amount being repaid or prepaid, and all such payments
(and, in any event, any payments in respect of any Loan on a date when
interest is due and payable with respect to such Loan) shall be applied
to the payment of interest before application to principal.
(iv) Apportionment of Payments. Aggregate principal and
interest payments in respect of Term Loans and Revolving Loans shall be
apportioned among all outstanding Loans to which such payments relate,
in each case proportionately to Lenders' respective Pro Rata Shares.
Administrative Agent shall promptly distribute to each Lender, at its
primary address set forth below its name on the appropriate signature
page hereof or at such other address as such Lender may request, its
Pro Rata Share of all such payments received by Administrative Agent
and the commitment fees of such Lender, if any, when received by
Administrative Agent pursuant to subsection 2.3. Notwithstanding the
foregoing provisions of this subsection 2.4C(iv), if, pursuant to the
43
provisions of subsection 2.6C, any Notice of Conversion/Continuation is
withdrawn as to any Affected Lender or if any Affected Lender makes
Base Rate Loans in lieu of its Pro Rata Share of any LIBOR Loans,
Administrative Agent shall give effect thereto in apportioning payments
received thereafter.
(v) Payments on Business Days. Whenever any payment to be made
hereunder shall be stated to be due on a day that is not a Business
Day, such payment shall be made on the next succeeding Business Day and
such extension of time shall be included in the computation of the
payment of interest hereunder or of the commitment fees hereunder, as
the case may be.
(vi) Notation of Payment. Each Lender agrees that before
disposing of any Note held by it, or any part thereof (other than by
granting participations therein), that Lender will use reasonable
efforts to make a notation thereon of all Loans evidenced by that Note
and all principal payments previously made thereon and of the date to
which interest thereon has been paid; provided that the failure to make
(or any error in the making of) a notation of any Loan made under such
Note shall not limit or otherwise affect the obligations of Borrower
hereunder or under such Note with respect to any with Loan or any
payments of principal or interest on such Note; provided, further,
however, that in the event of any inconsistency the Register shall
govern (absent manifest error).
D. APPLICATION OF PROCEEDS OF COLLATERAL AND PAYMENTS AFTER
EVENT OF DEFAULT.
Upon the occurrence and during the continuation of an Event of
Default, (a) all payments received on account of the Obligations, whether from
Company, from any Subsidiary Guarantor or otherwise, shall be applied by
Administrative Agent against the Obligations and (b) all proceeds received by
Administrative Agent in respect of any sale of, collection from, or other
realization upon all or any part of the Collateral under any Collateral Document
may, in the discretion of Administrative Agent, be held by Administrative Agent
as Collateral for, and/or (then or at any time thereafter) applied in full or in
part by Administrative Agent against, the applicable Secured Obligations (as
defined in such Collateral Document), in each case in the following order of
priority:
(a) To the payment of all costs and expenses of such sale,
collection or other realization, including reasonable compensation to
Administrative Agent and its agents and counsel, and all other
expenses, liabilities and advances made or incurred by Administrative
Agent in connection therewith, and all amounts for which Administrative
Agent is entitled to compensation (including the fees described in
subsection 2.3), reimbursement and indemnification under any Loan
Document and all advances made by Administrative Agent thereunder for
the account of the applicable Loan Party, and to the payment of all
costs and expenses paid or incurred by Administrative Agent in
connection with the Loan Documents, all in accordance with subsections
9.4, 10.2 and 10.3 and the other terms of this Agreement and the other
Loan Documents;
44
(b) To the payment of the costs and expenses of any collection
or other realization under the Subsidiary Guaranty, including
reasonable compensation to Administrative Agent and its counsel, and
all expenses, liabilities and advances made or incurred by
Administrative Agent in connection therewith, all in accordance with
the terms of this Agreement and the Subsidiary Guaranty;
(c) thereafter, to the extent of any excess such proceeds, to
the payment of all other Secured Obligations (as defined in such
Collateral Document) or Guarantied Obligations (as defined in the
Subsidiary Guaranty) for the ratable benefit of the holders thereof
(subject to the provisions of subsection 2.4C(ii)); and
(d) thereafter, to the extent of any excess such proceeds, to
the payment to or upon the order of such Loan Party or Subsidiary
Guarantor, as applicable, or to whosoever may be lawfully entitled to
receive the same or as a court of competent jurisdiction may direct.
2.5 USE OF PROCEEDS.
A. INITIAL REVOLVING LOAN. The proceeds of the initial Revolving
Loans shall be applied by Borrower contemporaneously to consummate the
refinancing of and repay in full all outstanding principal and accrued and
unpaid interest under the Existing Credit Agreement.
B. REVOLVING LOANS. The proceeds of any other Revolving Loans shall
be applied by Borrower to redeem the Borrower's 9.25% First Mortgage Notes and
for working capital and other general corporate purposes, which may include the
making of capital expenditures, acquisitions, permitted Investments and
intercompany loans to any Subsidiary Guarantors that are wholly-owned
Subsidiaries of Borrower, in accordance with subsection 7.1(iv), for their own
general corporate purposes.
C. MARGIN REGULATIONS. No portion of the proceeds of any borrowing
under this Agreement shall be used by Borrower or any of its Subsidiaries in any
manner that might cause the borrowing or the application of such proceeds to
violate Regulation T, Regulation U or Regulation X of the Board of Governors of
the Federal Reserve System or any other regulation of such Board or to violate
the Exchange Act, in each case as in effect on the date or dates of such
borrowing and such use of proceeds.
2.6 SPECIAL PROVISIONS GOVERNING LIBOR LOANS.
Notwithstanding any other provision of this Agreement to the
contrary, the following provisions shall govern with respect to LIBOR Loans as
to the matters covered:
A. DETERMINATION OF APPLICABLE INTEREST RATE. As soon as practicable
after 12:00 Noon (New York City time) on each Interest Rate Determination Date,
Administrative Agent shall determine (which determination shall, absent manifest
error, be final, conclusive and
45
binding upon all parties) the interest rate that shall apply to the LIBOR Loans
for which an interest rate is then being determined for the applicable Interest
Period and shall promptly give notice thereof (in writing or by telephone
confirmed in writing) to Borrower and each Lender.
B. INABILITY TO DETERMINE APPLICABLE INTEREST RATE. If
Administrative Agent shall have determined (which determination shall be final
and conclusive and binding upon all parties hereto), on any Interest Rate
Determination Date with respect to any LIBOR Loans, that by reason of
circumstances affecting the interbank Eurodollar market adequate and fair means
do not exist for ascertaining the interest rate applicable to such Loans on the
basis provided for in the definition of Adjusted LIBOR, Administrative Agent
shall on such date give notice (by facsimile or by telephone confirmed in
writing) to Borrower and each Lender of such determination, whereupon (i) no
Loans may be made or continued as, or converted to, LIBOR Loans until such time
as Administrative Agent notifies Borrower and Lenders that the circumstances
giving rise to such notice no longer exist (the Administrative Agent shall use
commercially reasonable efforts to provide such notice to Borrower and Lenders
as promptly as reasonably practicable after becoming aware that such
circumstances no longer exist) and (ii) any Notice of Borrowing or Notice of
Conversion/Continuation given by Borrower with respect to the Loans in respect
of which such determination was made shall be deemed to be rescinded by
Borrower.
C. ILLEGALITY OR IMPRACTICABILITY OF LIBOR LOANS. If on any date any
Lender shall have determined (which determination shall be final, conclusive and
binding upon all parties hereto but shall be made only after consultation with
Borrower and Administrative Agent) that the making, maintaining or continuation
of its LIBOR Loans (i) has become unlawful as a result of compliance by such
Lender in good faith with any law, treaty, governmental rule, regulation,
guideline or order (or would conflict with any such treaty, governmental rule,
regulation, guideline or order not having the force of law even though the
failure to comply therewith would not be unlawful) or (ii) has become
impracticable, or would cause such Lender material hardship, as a result of
contingencies occurring after the date of this Agreement which materially and
adversely affect the interbank Eurodollar market or the position of such Lender
in that market, then, and in any such event, such Lender shall be an "AFFECTED
LENDER" and it shall on that day give notice (by facsimile or by telephone
confirmed in writing) to Borrower and Administrative Agent of such determination
(which notice Administrative Agent shall promptly transmit to each other Lender
by facsimile or electronic mail). Thereafter (a) the obligation of the Affected
Lender to make or continue Loans as, or to convert Loans to, LIBOR Loans shall
be suspended until such notice shall be withdrawn by the Affected Lender, (b) to
the extent such determination by the Affected Lender relates to a LIBOR Loan
then being requested by Borrower pursuant to a Notice of Borrowing or a Notice
of Conversion/Continuation, the Affected Lender shall make or continue such Loan
as (or convert such Loan to, as the case may be) a Base Rate Loan, (c) the
Affected Lender's obligation to maintain its outstanding LIBOR Loans (the
"AFFECTED LOANS") shall be terminated at the earlier to occur of the expiration
of the Interest Period then in effect with respect to the Affected Loans or when
required by law, and (d) the Affected Loans shall automatically convert into
Base Rate Loans on the date of such termination. Notwithstanding the foregoing,
to the extent a determination by an Affected Lender as described above relates
to a LIBOR Loan then being
46
requested by Borrower pursuant to a Notice of Borrowing or a Notice of
Conversion/Continuation, Borrower shall have the option, subject to the
provisions of subsection 2.6D, to rescind such Notice of Borrowing or Notice of
Conversion/Continuation as to all Lenders by giving notice (by facsimile or by
telephone confirmed in writing) to Administrative Agent of such rescission on
the date on which the Affected Lender gives notice of its determination as
described above (which notice of rescission Administrative Agent shall promptly
transmit to each Lender) by facsimile or electronic mail. Except as provided in
the immediately preceding sentence, nothing in this subsection 2.7C shall affect
the obligation of any Lender other than an Affected Lender to make or maintain
Loans as, or to convert Loans to, LIBOR Loans in accordance with the terms of
this Agreement.
D. COMPENSATION FOR BREAKAGE OR NON-COMMENCEMENT OF INTEREST
PERIODS. Borrower shall compensate each Lender, upon written request by that
Lender (which request shall set forth the basis for requesting such amounts)
pursuant to subsection 2.8, for all reasonable losses, expenses and liabilities
(including any interest paid by that Lender to lenders of funds borrowed by it
to make or carry its LIBOR Loans and any loss, expense or liability (but not
lost profit or loss of applicable margin) sustained by that Lender in connection
with the liquidation or re-employment of such funds) which that Lender may
sustain: (i) if for any reason (other than a default by that Lender) a borrowing
of any LIBOR Loan does not occur on a date specified therefor in a Notice of
Borrowing or a telephonic request therefor, or a conversion to or continuation
of any LIBOR Loan does not occur on a date specified therefor in a Notice of
Conversion/Continuation, (ii) if any prepayment (including any prepayment
described in subsection 2.4B(i) or conversion occasioned by the circumstances
described in subsection 2.6C) or other principal payment or any conversion of
any of its LIBOR Loans occurs on a date prior to the last day of an Interest
Period applicable to that Loan, (iii) if any prepayment of any of its LIBOR
Loans is not made on any date specified in a notice of prepayment given by
Borrower, or (iv) as a consequence of any other default by Borrower in the
repayment of its LIBOR Loans when required by the terms of this Agreement.
E. BOOKING OF LIBOR LOANS. Any Lender may make, carry or transfer
LIBOR Loans at, to, or for the account of any of its branch offices or the
office of an Affiliate of that Lender.
F. ASSUMPTIONS CONCERNING FUNDING OF LIBOR LOANS. Calculation of all
amounts payable to a Lender under this subsection 2.6 and under subsection 2.7A
shall be made as though such Lender had actually funded each of its relevant
LIBOR Loans through the purchase of a Eurodollar deposit bearing interest at the
rate obtained pursuant to clause (i) of the definition of Adjusted LIBOR in an
amount equal to the amount of such LIBOR Loan and having a maturity comparable
to the relevant Interest Period, whether or not its LIBOR Loans had actually
been funded in such manner and through the transfer of such Eurodollar deposit
from an offshore office of that Lender to a domestic office of that Lender in
the United States of America; provided, however, that each Lender may fund each
of its LIBOR Loans in any manner it sees fit and the foregoing assumptions shall
be utilized only for the purposes of calculating amounts payable under this
subsection 2.6 and under subsection 2.7A.
47
G. LIBOR LOANS AFTER EVENT OF DEFAULT OR POTENTIAL EVENT OF DEFAULT.
(i) After the occurrence of and during the continuation of an Event of Default,
Borrower may not elect to have a Loan be made or maintained as, or converted to,
a LIBOR Loan after the expiration of any Interest Period then in effect for that
Loan, and subject to the provisions of subsection 2.6D, any Notice of Borrowing
or Notice of Conversion/Continuation given by Borrower with respect to a
requested borrowing or conversion/continuation that has not yet occurred shall
be deemed to be rescinded by Borrower, and (ii) after the occurrence of and
during the continuation of a Potential Event of Default, Borrower may not elect
to have a Loan be made or maintained as, or converted to, a LIBOR Loan with an
Interest Period greater than one month.
2.7 Increased Costs; Taxes; Capital Adequacy.
A. Compensation for Increased Costs and Taxes. Subject to the
provisions of subsection 2.7B (which shall be controlling with respect to the
matters covered thereby), if any Lender shall determine (which determination
shall, absent manifest error, be final and conclusive and binding upon all
parties hereto) that any law, treaty or governmental rule, regulation or order,
or any change therein or in the interpretation, administration or application
thereof (including the introduction of any new law, treaty or governmental rule,
regulation or order), or any determination of a court or Governmental Authority,
in each case that becomes effective after the date hereof, or compliance by such
Lender with any guideline, request or directive issued or made after the date
hereof by any central bank or other governmental or quasi-Governmental Authority
(whether or not having the force of law):
(i) subjects such Lender (or its applicable lending office) to any
additional Tax or changes the basis of taxation with respect to this
Agreement or any of its obligations hereunder (including with respect to
issuing or maintaining any Letters of Credit or purchasing or maintaining
any participations therein or maintaining any Commitment hereunder) or any
payments to such Lender (or its applicable lending office) of principal,
interest, fees or any other amount payable hereunder;
(ii) imposes, modifies or holds applicable any reserve (including
any marginal, emergency, supplemental, special or other reserve), special
deposit, compulsory loan, FDIC insurance or similar requirement against
assets held by, or deposits or other liabilities in or for the account of,
or advances or loans by, or other credit extended by, or any other
acquisition of funds by, any office of such Lender (other than any such
reserve or other requirements with respect to LIBOR Loans to the extent
reflected in the definition of Adjusted LIBOR); or
(iii) imposes any other condition (other than with respect to a Tax
matter) on or affecting such Lender (or its applicable lending office) or
its obligations hereunder or the interbank Eurodollar market;
and the result of any of the foregoing is to increase the cost to such Lender of
agreeing to make, making or maintaining its Loans or Commitments or agreeing to
issue, issuing or maintaining any Letter of Credit or agreeing to purchase,
purchasing or maintaining any participation therein
48
or to reduce any amount received or receivable by such Lender (or its applicable
lending office) with respect thereto; then, in any such case, Borrower shall
promptly pay to such Lender, upon receipt of the statement referred to in the
next sentence, such additional amount or amounts (in the form of an increased
rate of, or a different method of calculating, interest or otherwise as such
Lender in its sole discretion shall determine) as may be necessary to compensate
such Lender for any such increased cost or reduction in amounts received or
receivable hereunder. Such Lender shall deliver to Borrower (with a copy to
Administrative Agent) a written statement, setting forth in reasonable detail
the basis for calculating the additional amounts owed to such Lender under this
subsection 2.7A, which statement shall be conclusive and binding upon all
parties hereto absent manifest error.
B. WITHHOLDING OF TAXES.
(i) Payments to Be Free and Clear. All sums payable by Borrower
under this Agreement and the other Loan Documents shall be paid free and
clear of, and without any deduction or withholding on account of, any Tax
imposed, levied, collected, withheld or assessed by or within the United
States of America or any political subdivision in or of the United States
of America or any other jurisdiction from or to which a payment is made by
or on behalf of Borrower or by any federation or organization of which the
United States of America or any such jurisdiction is a member at the time
of payment.
(ii) Grossing-up of Payments. If Borrower or any other Person is
required by law to make any deduction or withholding on account of any
such Tax from any sum paid or payable by Borrower to Administrative Agent
or any Lender under any of the Loan Documents:
(a) Borrower shall notify Administrative Agent of any such
requirement or any change in any such requirement as soon as
Borrower becomes aware of it;
(b) Borrower shall pay any such Tax when such Tax is due,
regardless of whether the liability for payment of such Tax (i) is
imposed on Borrower itself, on Administrative Agent or any Lender or
(ii) relates to any portion of any sums paid or payable to any
Lender under any of the Loan Documents with respect to which such
Lender does not act for its own account;
(c) the sum payable by Borrower in respect of which the
relevant deduction, withholding or payment is required shall be
increased to the extent necessary to ensure that, after the making
of that deduction, withholding or payment, Administrative Agent or
such Lender, as the case may be, receives on the due date a net sum
equal to what it would have received had no such deduction,
withholding or payment been required or made; and
(d) within 30 days after paying any sum from which it is
required by law to make any deduction or withholding, and within 30
days after the due date of payment of any Tax which it is required
by clause (b) above to pay, Borrower
49
shall deliver to Administrative Agent and/or other affected parties
evidence satisfactory to the other affected parties of such
deduction, withholding or payment and of the remittance thereof to
the relevant taxing or other authority;
provided that no such additional amount shall be required to be paid to
any Lender under clause (c) above (i) to the extent such additional
amount relates to a portion of any sums paid or payable to such Lender
under any of the Loan Documents with respect to which such Lender does
not act for its own account, or (ii) except to the extent that any
change after the date such Lender became a Lender in any such
requirement for a deduction, withholding or payment as is mentioned
therein shall result in an increase in the rate of such deduction,
withholding or payment from that in effect at the date on which such
Lender became a Lender, in respect of payments to such Lender.
(iii) Evidence of Exemption from U.S. Withholding Tax.
(a) Each Lender that is organized under the laws of any
jurisdiction other than the United States or any state or other
political subdivision thereof (for purposes of this subsection
2.7B(iii), a "Non-US Lender") shall deliver to Administrative Agent
and to Borrower, on or prior to the Closing Date (in the case of
each Lender listed on the signature pages hereof) or on or prior to
the date of the Assignment Agreement pursuant to which it becomes a
Lender (in the case of each other Lender), and at such other times
as may be necessary in the determination of Borrower or
Administrative Agent (each in the reasonable exercise of its
discretion), two original copies of Internal Revenue Service Form
W-8BEN or W-8ECI (or any successor forms) properly completed and
duly executed by such Non-US Lender, or, in the case of a Non-US
Lender claiming exemption from United States federal withholding tax
under Section 871(h) or 881(c) of the Internal Revenue Code with
respect to payments of "portfolio interest," a Form W-8BEN, and, in
the case of a Non-US Lender that has certified in writing to
Administrative Agent that it is not a "bank" (as defined in Section
881(c)(3)(A) of the Internal Revenue Code), a certificate of such
Non-US Lender certifying that such Non-US Lender is not (i) a "bank"
for purposes of Section 881(c) of the Internal Revenue Code, (ii) a
ten-percent shareholder (within the meaning of Section 871(h)(3)(B)
of the Internal Revenue Code) of Borrower, or (iii) a controlled
foreign corporation related to Borrower (within the meaning of
Section 864(d)(4) of the Internal Revenue Code) in each case
together with any other certificate or statement of exemption
required under the Internal Revenue Code or the regulations issued
thereunder to establish that such Non-US Lender is not subject to
United States withholding tax with respect to any payments to such
Non-US Lender of interest payable under any of the Loan Documents.
(b) Each Non-US Lender, to the extent it does not act or
ceases to act for its own account with respect to any portion of any
sums paid or payable to such Lender under any of the Loan Documents
(for example, in the case of a typical participation by such
Lender), shall deliver to Administrative Agent and to Borrower, on
or prior to the Closing Date (in the case of each Non-US Lender
50
listed on the signature pages hereof), on or prior to the date of
the Assignment Agreement pursuant to which it becomes a Lender (in
the case of each other Non-US Lender), or on such later date when
such Non-US Lender ceases to act for its own account with respect to
any portion of any such sums paid or payable, and at such other
times as may be necessary in the determination of Borrower or
Administrative Agent (each in the reasonable exercise of its
discretion), (1) two original copies of the forms or statements
required to be provided by such Non-US Lender under subsection
2.7B(iii)(a), properly completed and duly executed by such Non-US
Lender, to establish the portion of any such sums paid or payable
with respect to which such Non-US Lender acts for its own account
that is not subject to United States withholding tax, and (2) two
original copies of Internal Revenue Service Form W-8IMY (or any
successor forms) properly completed and duly executed by such Non-US
Lender, together with any information, if any, such Non-US Lender
chooses to transmit with such form, and any other certificate or
statement of exemption required under the Internal Revenue Code or
the regulations issued thereunder, to establish that such Non-US
Lender is not acting for its own account with respect to a portion
of any such sums payable to such Non-US Lender.
(c) Each Non-US Lender hereby agrees, from time to time after
the initial delivery by such Non-US Lender of such forms, whenever a
lapse in time or change in circumstances renders such forms,
certificates or other evidence so delivered obsolete or inaccurate
in any material respect or if, by virtue of a change in law or
regulations, such forms are no longer valid evidence of a person's
exemption from withholding tax which is reasonably satisfactory to
Borrower, that such Non-US Lender shall promptly (1) deliver to
Administrative Agent and to Borrower two original copies of
renewals, amendments or additional or successor forms, properly
completed and duly executed by such Non-US Lender, together with any
other certificate or statement of exemption required in order to
confirm or establish that such Non-US Lender is not subject to
United States withholding tax with respect to payments to such
Non-US Lender under the Loan Documents and, if applicable, that such
Non-US Lender does not act for its own account with respect to any
portion of any such payments, or (2) notify Administrative Agent and
Borrower of its inability to deliver any such forms, certificates or
other evidence.
(d) Borrower shall not be required to pay any additional
amount to any Non-US Lender under clause (c) of subsection 2.7B(ii)
if such Non-US Lender shall have failed to satisfy the requirements
of clause (a), (b) or (c)(1) of this subsection 2.7B(iii); provided
that if such Non-US Lender shall have satisfied the requirements of
subsection 2.7B(iii)(a) on the date such Non-US Lender became a
Lender, nothing in this subsection 2.7B(iii)(d) shall relieve
Borrower of its obligation to pay any amounts pursuant to subsection
2.7B(ii)(c) if, as a result of any change in any applicable law,
treaty or governmental rule, regulation or order, or any change in
the interpretation, administration or application thereof, such
51
Non-US Lender is no longer properly entitled to deliver forms,
certificates or other evidence at a subsequent date establishing the
fact that such Non-US Lender is not subject to withholding as
described in subsection 2.7B(iii)(a).
C. CAPITAL ADEQUACY ADJUSTMENT. If any Lender shall have determined
that the adoption, effectiveness, phase-in or applicability after the date
hereof of any law, rule or regulation (or any provision thereof) regarding
capital adequacy, or any change therein or in the interpretation or
administration thereof by any Governmental Authority, central bank or comparable
agency charged with the interpretation or administration thereof, or compliance
by any Lender (or its applicable lending office) with any guideline, request or
directive regarding capital adequacy (whether or not having the force of law) of
any such Governmental Authority, central bank or comparable agency, has or would
have the effect of reducing the rate of return on the capital of such Lender or
any corporation controlling such Lender as a consequence of, or with reference
to, such Lender's Loans or Commitments or Letters of Credit or participations
therein or other obligations hereunder with respect to the Loans or the Letters
of Credit to a level below that which such Lender or such controlling
corporation could have achieved but for such adoption, effectiveness, phase-in,
applicability, change or compliance (taking into consideration the policies of
such Lender or such controlling corporation with regard to capital adequacy),
then from time to time, within five Business Days after receipt by Borrower from
such Lender of the statement referred to in the next sentence, Borrower shall
pay to such Lender such additional amount or amounts as will compensate such
Lender or such controlling corporation on an after-tax basis for such reduction,
provided, however, that Borrower shall not be required to compensate a Lender
pursuant to this subsection 2.7C for any increased costs or reductions that such
Lender became aware of more than 180 days prior to the date such Lender makes a
claim for compensation hereunder. Such Lender shall deliver to Borrower (with a
copy to Administrative Agent) a written statement, setting forth in reasonable
detail the basis of the calculation of such additional amounts, which statement
shall be conclusive and binding upon all parties hereto absent manifest error.
2.8 OBLIGATION OF LENDERS AND ISSUING LENDERS TO MITIGATE.
Each Lender and Issuing Lender agrees that, as promptly as
practicable after the officer of such Lender or Issuing Lender responsible for
administering the Loans or Letters of Credit of such Lender or Issuing Lender,
as the case may be, becomes aware of the occurrence of an event or the existence
of a condition that would cause such Lender to become an Affected Lender or that
would entitle such Lender or Issuing Lender to receive payments under subsection
2.7, it will, to the extent not inconsistent with the internal policies of such
Lender or Issuing Lender and any applicable legal or regulatory restrictions,
use reasonable efforts (i) to make, issue, fund or maintain the Commitments of
such Lender or the affected Loans or Letters of Credit of such Lender or Issuing
Lender through another lending or letter of credit office of such Lender or
Issuing Lender, or (ii) take such other measures as such Lender or Issuing
Lender may deem reasonable, if as a result thereof the circumstances which would
cause such Lender to be an Affected Lender would cease to exist or the
additional amounts which would otherwise be required to be paid to such Lender
or Issuing Lender pursuant to subsection 2.7 would be materially reduced and if,
as determined by such Lender or Issuing Lender in its sole discretion, the
making, issuing, funding or maintaining of such Commitments or Loans or Letters
of Credit
52
through such other lending or letter of credit office or in accordance with such
other measures, as the case may be, would not otherwise be disadvantageous to
such Lender or Issuing Lender or materially adversely affect such Commitments or
Loans or Letters of Credit or the interests of such Lender or Issuing Lender;
provided that such Lender or Issuing Lender will not be obligated to utilize
such other lending or letter of credit office pursuant to this subsection 2.8
unless Borrower agrees to pay all incremental expenses incurred by such Lender
or Issuing Lender as a result of utilizing such other lending or letter of
credit office as described in clause (i) above. A certificate as to the amount
of any such expenses payable by Borrower pursuant to this subsection 2.8
(setting forth in reasonable detail the basis for requesting such amount)
submitted by such Lender or Issuing Lender to Borrower (with a copy to
Administrative Agent) shall be conclusive absent manifest error.
2.9 REPLACEMENT OF A LENDER.
A. AFFECTED LENDERS. If any Lender shall give notice to Borrower
that such Lender is an Affected Lender or that such Lender is entitled to
receive payments under subsection 2.7C, or if any Lender is not permitted to
fund Loans as described in subsection 4.2B(iv), and unless the circumstances
that have caused such payment or that cause such Lender to be unable to fund
Loans are no longer in effect, Borrower may, if such Lender shall fail to
withdraw such notice within five Business Days after Borrower's request for such
withdrawal, upon ten days' prior written notice by Borrower to the
Administrative Agent and such Lender, elect to cause such Lender to assign all,
but not less than all, of its Loans and Commitments in accordance with the
provisions of subsection 10.1A to an Eligible Assignee designated by Borrower
and reasonably satisfactory to the Administrative Agent; provided that at any
time prior to the consummation of any such assignment, the Administrative Agent
may (but shall have no obligation to) designate another Eligible Assignee in
substitution for the Eligible Assignee designated by Borrower, in which event
the applicable Lender shall assign its Loans and Commitments to such other
Eligible Assignee.
B. DEFAULTING LENDERS. If any Funding Default is continuing and no
Event of Default or Potential Event of Default has occurred and is continuing,
(i) Borrower may, if the Defaulting Lender shall fail to cure the default within
five Business Days after Borrower's and/or Administrative Agent's request that
it cure such default, by giving notice to Administrative Agent and any
Defaulting Lender of its election to do so (a)(1) to replace such Defaulting
Lender with one or more Eligible Assignees upon receipt by such Defaulting
Lender of such notice; provided that, if such Defaulting Lender has any Loans
outstanding at the time of such replacement, the written consent of
Administrative Agent (which consent shall not be unreasonably withheld or
delayed) shall be required in order for Borrower to make the election set forth
in this clause (a); (ii) the Administrative Agent may, if such Defaulting Lender
shall fail to cure the default within five Business Days after the
Administrative Agent's request that it cure such default, by giving notice to
Borrower and such Defaulting Lender of its election to do so (a) terminate the
Commitment of such Defaulting Lender upon receipt by such Defaulting Lender of
such notice and (b) cause Borrower to prepay on the date of such termination any
outstanding Loans made by such Defaulting Lender, together with accrued and
unpaid interest thereon and any other amounts payable to such Defaulting Lender
hereunder pursuant to subsection 2.4C or otherwise; or (iii) Borrower or the
Administrative Agent may cause such Defaulting Lender to
53
assign its Loans and Commitments in full to an Eligible Assignee in accordance
with the provisions of subsection 10.1A.
C. REPLACEMENT LENDERS. (i) At the time of any replacement pursuant
to this subsection 2.9C, the Eligible Assignee (the "Replacement Lender")
replacing the applicable Lender the (the "Replaced Lender") shall enter into one
or more assignment agreements, in form and substance reasonably satisfactory to
the Administrative Agent, the Replacement Lender and the Replaced Lender,
pursuant to which the Replacement Lender shall acquire all of the Commitments
and outstanding Loans of the Replaced Lender and, in connection therewith, shall
pay to the Replaced Lender in respect thereof an amount equal to the sum of (A)
an amount equal to the principal of, and all accrued interest on, all
outstanding Loans of the Replaced Lender, and (B) an amount equal to all
accrued, but theretofore unpaid, fees owing to the Replaced Lender; and
(ii) all obligations of Borrower owing to the Replaced Lender
(excluding those specifically described in clause (i) above in respect
of which the assignment purchase price has been, or is concurrently
being, paid but including amounts payable pursuant to subsections 2.6D
and 2.7 to the extent such amounts have not been previously paid) shall
be paid by Borrower in full to such Replaced Lender concurrently with
such replacement.
Upon the execution of the respective assignment documentation,
the payments of amounts referred to in clauses (i) and (ii) above and, if so
requested by the Replacement Lender, the delivery of the appropriate Note or
Notes executed by Borrower, the Replacement Lender shall become a Lender
hereunder and the Replaced Lender shall cease to constitute a Lender hereunder,
except with respect to Borrower's obligations regarding the indemnification
provisions under this Agreement (including those set forth in subsections 2.7A
and 10.3), which will survive for the benefit of such Replaced Lender.
SECTION 3. LETTERS OF CREDIT
3.1 ISSUANCE OF LETTERS OF CREDIT AND LENDERS' PURCHASE OF
PARTICIPATIONS THEREIN.
A. LETTERS OF CREDIT. In addition to Borrower requesting
that Lenders make Revolving Loans pursuant to subsection 2.1A, Borrower may
request, in accordance with the provisions of this subsection 3.1, from time to
time during the period from the Closing Date to but excluding the 30th day prior
to the Revolving Loan Commitment Termination Date, that one or more Lenders
issue Letters of Credit for the account of Borrower. Subject to the terms and
conditions of this Agreement and in reliance upon the representations and
warranties of Borrower herein set forth, any one or more Lenders may, but
(except as provided in subsection 3.1B(iii)) shall not be obligated to, issue
such Letters of Credit in accordance with the provisions of this subsection 3.1;
provided that Borrower shall not request hereunder that any Lender issue (and no
Lender shall issue):
54
(i) any Letter of Credit if, after giving effect to such
issuance, the Total Utilization of Revolving Loan Commitments would
exceed the lesser of the Revolving Loan Commitments or the Borrowing
Base then in effect;
(ii) any Letter of Credit if, after giving effect to such
issuance, the Letter of Credit Usage would exceed $10,000,000;
(iii) any Letter of Credit having an expiration date later
than the earlier of (a) ten days prior to the Revolving Loan Commitment
Termination Date and (b) the date which is one year from the date of
issuance of such Letter of Credit; provided that the immediately
preceding clause (b) shall not prevent any Issuing Lender (but subject
to clause (a) above) from agreeing that a Letter of Credit will
automatically be extended for one or more successive periods not to
exceed one year each unless such Issuing Lender elects not to extend
for any such additional period; and provided, further that such Issuing
Lender shall elect not to extend such Letter of Credit if it has
knowledge that an Event of Default or Potential Event of Default has
occurred and is continuing (and has not been waived in accordance with
subsection 10.6) at the time such Issuing Lender must elect whether or
not to allow such extension;
(iv) any Letter of Credit with a face amount of less than
$100,000;
(v) any Letter of Credit denominated in a currency other
than Dollars; or
(vi) any Letter of Credit that is otherwise unacceptable to
the applicable Issuing Lender in its reasonable discretion.
B. MECHANICS OF ISSUANCE.
(i) Notice of Issuance. Whenever Borrower desires the
issuance of a Letter of Credit, it shall deliver to Administrative
Agent a Notice of Issuance of Letter of Credit substantially in the
form of Exhibit III annexed hereto no later than 12:00 Noon (New York
City time) at least five Business Days, or in each case such shorter
period as may be agreed to by the Issuing Lender in any particular
instance, in advance of the proposed date of issuance. The Notice of
Issuance of Letter of Credit shall specify (a) the proposed date of
issuance (which shall be a Business Day), (b) the face amount of the
Letter of Credit, (c) the expiration date of the Letter of Credit, (d)
the name and address of the beneficiary, and (e) either the verbatim
text of the proposed Letter of Credit or the proposed terms and
conditions thereof, including a precise description of any documents to
be presented by the beneficiary which, if presented by the beneficiary
prior to the expiration date of the Letter of Credit, would require the
Issuing Lender to make payment under the Letter of Credit; provided
that such Issuing Lender, in its reasonable discretion, may require
changes in the text of the proposed Letter of Credit or any such
documents; and provided, further that no Letter of Credit shall require
payment against a conforming draft to be made thereunder on the same
Business Day (under the laws of the jurisdiction in which the office of
the Issuing Lender to which such draft is required to be presented is
55
located) that such draft is presented if such presentation is made
after 10:00 A.M. (in the time zone of such office of such Issuing
Lender) on such Business Day.
(ii) Update of Certifications. Borrower shall notify the
applicable Issuing Lender (and Administrative Agent, if Administrative
Agent is not such Issuing Lender) prior to the issuance of any Letter
of Credit if any of the matters to which Borrower is required to
certify in the applicable Notice of Issuance of Letter of Credit is no
longer true and correct as of the proposed date of issuance of such
Letter of Credit, and upon the issuance of any Letter of Credit
Borrower shall be deemed to have re-certified, as of the date of such
issuance, as to the matters to which Borrower is required to certify in
the applicable Notice of Issuance of Letter of Credit.
(iii) Determination of Issuing Lender. Upon receipt by
Administrative Agent of a Notice of Issuance of Letter of Credit
pursuant to subsection 3.1B(i) requesting the issuance of a Letter of
Credit, if Administrative Agent elects to issue such Letter of Credit,
Administrative Agent shall promptly so notify Borrower, and
Administrative Agent shall be the Issuing Lender with respect thereto.
If Administrative Agent, in its sole discretion, elects not to issue
such Letter of Credit, Administrative Agent shall promptly so notify
Borrower, whereupon Borrower may request any other Lender to issue such
Letter of Credit by delivering to such Lender a copy of the applicable
Notice of Issuance of Letter of Credit. Any Lender so requested to
issue such Letter of Credit shall promptly notify Borrower and
Administrative Agent whether or not, in its sole discretion, it has
elected to issue such Letter of Credit, and any such Lender that so
elects to issue such Letter of Credit shall be the Issuing Lender with
respect thereto.
(iv) Issuance of Letter of Credit. Upon satisfaction or
waiver (in accordance with subsection 10.6) of the conditions set forth
in subsection 4.3, the Issuing Lender shall issue the requested Letter
of Credit in accordance with such Issuing Lender's standard operating
procedures.
(v) Notification to Lenders. Upon the issuance of or
amendment to any Letter of Credit, the applicable Issuing Lender shall
promptly notify Administrative Agent, which shall thereafter notify
each other Lender of such issuance or amendment by facsimile or
electronic mail (or by telephone promptly confirmed by facsimile or
electronic mail). Promptly after receipt of such notice (or, if
Administrative Agent is the Issuing Lender, together with such notice),
Administrative Agent shall notify each Lender by facsimile or
electronic mail (or by telephone promptly confirmed by facsimile or
electronic mail) of the amount of such Lender's respective
participation in such Letter of Credit, determined in accordance with
subsection 3.1C.
C. Lenders' Purchase of Participations in Letters of
Credit. Immediately upon the issuance of each Letter of Credit, each Revolving
Lender shall be deemed to, and hereby agrees to, have irrevocably purchased from
the Issuing Lender a participation in such Letter of Credit and any drawings
honored thereunder in an amount equal to such Revolving Lender's Pro Rata Share
of the maximum amount which is or at any time may become available to be drawn
thereunder.
56
3.2 LETTER OF CREDIT FEES.
Borrower agrees to pay the following amounts with respect to
Letters of Credit issued hereunder:
(i) with respect to each Letter of Credit, (a) a fronting
fee, payable to Administrative Agent for the account of the applicable
Issuing Lender, equal to 0.25% per annum of the daily amount available
to be drawn under such Letter of Credit, and (b) a letter of credit
fee, payable to Administrative Agent for the account of Revolving
Lenders, equal to the Applicable LIBOR Margin for Revolving Loans
multiplied by the daily amount available to be drawn under such Letter
of Credit, each such fronting fee or letter of credit fee to be payable
in arrears on the last Business Day of each March, June, September and
December of each Fiscal Year commencing on the first such date to occur
after the Closing Date, and computed on the basis of a 360-day year for
the actual number of days elapsed; and
(ii) with respect to the issuance, amendment or transfer of
each Letter of Credit and each payment of a drawing made thereunder
(without duplication of the fees payable under clause (i) above),
documentary and processing charges payable directly to the applicable
Issuing Lender for its own account in accordance with such Issuing
Lender's standard schedule for such charges in effect at the time of
such issuance, amendment, transfer or payment, as the case may be.
For purposes of calculating any fees payable under clauses (i) and (ii) of this
subsection 3.2, the daily amount available to be drawn under any Letter of
Credit shall be determined as of the close of business on any date of
determination. Promptly upon receipt by Administrative Agent of any amount
described in clause (i) or (ii) of this subsection 3.2, Administrative Agent
shall distribute to each Revolving Lender its Pro Rata Share of such amount.
3.3 DRAWINGS AND REIMBURSEMENT OF AMOUNTS PAID UNDER LETTERS OF
CREDIT.
A. RESPONSIBILITY OF ISSUING LENDER WITH RESPECT TO
DRAWINGS. In determining whether to honor any drawing under any Letter of Credit
by the beneficiary thereof, the applicable Issuing Lender shall be responsible
only to examine the documents delivered under such Letter of Credit with
reasonable care so as to ascertain whether they appear on their face to be in
accordance with the terms and conditions of such Letter of Credit.
B. REIMBURSEMENT BY BORROWER OF AMOUNTS PAID UNDER
LETTERS OF CREDIT. If an Issuing Lender has determined to honor a drawing under
a Letter of Credit issued by it, such Issuing Lender shall immediately notify
Borrower and Administrative Agent, and Borrower shall reimburse such Issuing
Lender on or before the date on which such drawing is honored (the
"REIMBURSEMENT DATE") in an amount in Dollars and in same day funds equal to the
amount of such honored drawing plus interest thereon as provided in subsection
3.3D(i) for the period from the date of drawing to the date such Issuing Lender
is reimbursed (the "LC REIMBURSEMENT AMOUNT"); provided that, anything contained
in this Agreement to the contrary notwithstanding, (i) unless Borrower shall
have notified Administrative Agent and such Issuing
57
Lender prior to 10:00 A.M. (New York City time) on the date such drawing is
honored that Borrower intends to reimburse such Issuing Lender for the LC
Reimbursement Amount with funds other than the proceeds of Revolving Loans,
Borrower shall be deemed to have given a timely Notice of Borrowing to
Administrative Agent requesting Lenders to make Revolving Loans that are Base
Rate Loans on the Reimbursement Date in an amount in Dollars equal to the LC
Reimbursement Amount (and Administrative Agent shall promptly give notice
thereof to each Lender by facsimile or electronic mail or by telephone promptly
confirmed by facsimile or electronic mail; provided such confirmation is
communicated by a different means than that of the original notice) and (ii)
subject to satisfaction or waiver of the conditions specified in subsection
4.2B, Lenders shall, on the Reimbursement Date, make Revolving Loans that are
Base Rate Loans in the LC Reimbursement Amount, the proceeds of which shall be
applied directly by Administrative Agent to reimburse such Issuing Lender in an
amount equal to the LC Reimbursement Amount; and provided, further that if for
any reason proceeds of Revolving Loans are not received by Administrative Agent
for the account of such Issuing Lender on the Reimbursement Date in an amount
equal to the LC Reimbursement Amount, Borrower shall reimburse the
Administrative Agent for the account of such Issuing Lender, on demand, in an
amount in same day funds equal to the excess of (x) the LC Reimbursement Amount
over (y) the aggregate amount of such Revolving Loans, if any, which are so
received. Nothing in this subsection 3.3B shall be deemed to relieve any Lender
from its obligation to make Revolving Loans on the terms and conditions set
forth in this Agreement, and Borrower shall retain any and all rights it may
have against any Lender resulting from the failure of such Lender to make such
Revolving Loans under this subsection 3.3B. The applicable Issuing Lender may
honor or dishonor any drawing in accordance with the terms of the applicable
Letter of Credit without regard to any instruction of the Borrower.
C. Payment by Lenders of Unreimbursed Amounts Paid Under
Letters of Credit.
(i) Payment by Lenders. If Borrower shall fail for any
reason to reimburse any Issuing Lender or Administrative Agent as
provided in subsection 3.3B in an amount equal to the amount of any
drawing honored by such Issuing Lender under a Letter of Credit issued
by it, Administrative Agent shall promptly notify each Revolving Lender
of the unreimbursed amount of such honored drawing and of such
Revolving Lender's respective participation therein based on such
Revolving Lender's Pro Rata Share of the Revolving Loan Commitment by
facsimile or by telephone promptly confirmed by facsimile. Each
Revolving Lender shall make available to Administrative Agent for the
account of such Issuing Lender an amount equal to its respective
participation without giving effect to any unreimbursement due to a
Defaulting Lender, in Dollars and in same day funds, at the
Administrative Agent's office, not later than 12:00 Noon (New York City
time) on the Business Day notified by the Administrative Agent. If any
Revolving Lender fails to make available to Administrative Agent for
the account of such Issuing Lender on such Business Day the amount of
such Revolving Lender's participation in such Letter of Credit as
provided in this subsection 3.3C, Administrative Agent and/or such
Issuing Lender shall be entitled to recover such amount on demand from
such Revolving Lender together with interest thereon at the rate
customarily used by such
58
Issuing Lender for the correction of errors among banks for three
Business Days and thereafter at the Base Rate. Nothing in this
subsection 3.3C shall be deemed to prejudice the right of any Revolving
Lender to recover from any Issuing Lender any amounts made available by
such Revolving Lender to such Issuing Lender pursuant to this
subsection 3.3C if it is determined by the final judgment of a court of
competent jurisdiction that the payment with respect to a Letter of
Credit by such Issuing Lender in respect of which payment was made by
such Issuing Lender constituted gross negligence or willful misconduct
on the part of such Issuing Lender.
(ii) Distribution to Lenders of Reimbursements Received
From Borrower. If Administrative Agent for the account of any Issuing
Lender shall have been reimbursed by Revolving Lenders pursuant to
subsections 3.3B or 3.3C(i) for all or any portion of any drawing
honored by such Issuing Lender under a Letter of Credit issued by it,
Administrative Agent for the account of such Issuing Lender shall
promptly distribute to each Revolving Lender that has paid all amounts
payable by it under subsections 3.3B or 3.3C(i) with respect to such
honored drawing such Revolving Lender's Pro Rata Share of the Revolving
Loan Commitment of all payments subsequently received by Administrative
Agent for the account of such Issuing Lender from Borrower in
reimbursement of such honored drawing under the Letter of Credit when
such payments are received. Any such distribution shall be made to a
Revolving Lender at its primary address set forth below its name on the
appropriate signature page hereof or at such other address as such
Revolving Lender may request.
D. INTEREST ON AMOUNTS PAID UNDER LETTERS OF CREDIT.
(i) Payment of Interest by Borrower. Borrower agrees to
pay to Administrative Agent for the account of each Issuing Lender,
with respect to drawings honored under any Letters of Credit issued by
it, interest on the amount paid by such Issuing Lender in respect of
each such honored drawing from the date a drawing is honored to but
excluding the date such amount is reimbursed by Borrower (including any
such reimbursement out of the proceeds of Revolving Loans pursuant to
subsection 3.3B) at a rate equal to (a) for the period from the date
such drawing is honored to but excluding the Reimbursement Date, the
rate then in effect under this Agreement with respect to Revolving
Loans that are Base Rate Loans and (b) thereafter, a rate which is
2.00% per annum in excess of the rate of interest otherwise payable
under this Agreement with respect to Revolving Loans that are Base Rate
Loans. Interest payable pursuant to this subsection 3.3D(i) shall be
computed on the basis of a 365-day year for the actual number of days
elapsed in the period during which it accrues and shall be payable on
demand or, if no demand is made, on the date on which the related
drawing under a Letter of Credit is reimbursed in full.
(ii) Distribution of Interest Payments by Administrative
Agent. Promptly upon receipt by Administrative Agent for the account of
any Issuing Lender of any payment of interest pursuant to subsection
3.3D(i) with respect to a drawing honored under a Letter of Credit
issued by it, (a) Administrative Agent shall distribute to each
Revolving Lender, out of the interest received by Administrative Agent
in respect of the
59
period from the date such drawing is honored to but excluding the date
on which such Issuing Lender is reimbursed for the amount of such
honored drawing (including any such reimbursement out of the proceeds
of Revolving Loans pursuant to subsection 3.3B), the amount that such
other Revolving Lender would have been entitled to receive in respect
of the letter of credit fee that would have been payable in respect of
such Letter of Credit for such period pursuant to subsection 3.2 if no
drawing had been honored under such Letter of Credit, and (b) if such
Issuing Lender shall have been reimbursed by other Revolving Lenders
pursuant to subsection 3.3C(i) for all or any portion of such honored
drawing, such Issuing Lender shall pay to Administrative Agent for the
account of each other Revolving Lender that has paid all amounts
payable by it under subsection 3.3C(i) with respect to such honored
drawing such Revolving Lender's Pro Rata Share of the Revolving Loan
Commitment of any interest received by such Issuing Lender in respect
of that portion of such honored drawing so reimbursed by the Revolving
Lenders for the period from the date on which such Issuing Lender was
so reimbursed by the Revolving Lenders to but excluding the date on
which such portion of such honored drawing is reimbursed by Borrower.
Any such distribution shall be made to a Revolving Lender at its
primary address set forth below its name on the appropriate signature
page hereof or at such other address as such Revolving Lender may
request.
3.4 OBLIGATIONS ABSOLUTE.
The obligation of Borrower to reimburse each Issuing Lender
(or Administrative Agent for the account of each Issuing Lender) for drawings
honored under the Letters of Credit issued by it and to repay any Revolving
Loans made by Revolving Lenders pursuant to subsection 3.3B and the obligations
of Revolving Lenders under subsection 3.3C(i) shall be unconditional and
irrevocable and shall be paid strictly in accordance with the terms of this
Agreement under all circumstances including any of the following circumstances:
(i) any lack of validity or enforceability of any Letter
of Credit;
(ii) the existence of any claim, set-off, defense or other
right which Borrower or any Lender may have at any time against a
beneficiary or any transferee of any Letter of Credit (or any Persons
for whom any such transferee may be acting), any Issuing Lender or
other Lender or any other Person or, in the case of a Lender, against
Borrower, whether in connection with this Agreement, the transactions
contemplated herein or any unrelated transaction (including any
underlying transaction between Borrower or one of its Subsidiaries and
the beneficiary for which any Letter of Credit was procured);
(iii) any draft or other document presented under any Letter
of Credit proving to be forged, fraudulent, invalid or insufficient in
any respect or any statement therein being untrue or inaccurate in any
respect;
(iv) payment by the applicable Issuing Lender under any
Letter of Credit against presentation of a draft or other document
which does not substantially comply with the terms of such Letter of
Credit;
60
(v) any adverse change in the business, operations,
properties, assets, condition (financial or otherwise) or prospects of
Borrower or any of its Subsidiaries;
(vi) any breach of this Agreement or any other Loan
Document by any party thereto;
(vii) any other circumstance or happening whatsoever,
whether or not similar to any of the foregoing; or
(viii) the fact that an Event of Default or a Potential Event
of Default shall have occurred and be continuing;
provided, in each case, that payment by the applicable Issuing Lender under the
applicable Letter of Credit shall not have constituted gross negligence or
willful misconduct of such Issuing Lender under the circumstances in question
(as determined by a final judgment of a court of competent jurisdiction).
3.5 INDEMNIFICATION; NATURE OF ISSUING LENDERS' DUTIES.
A. INDEMNIFICATION. Borrower hereby agrees to protect,
indemnify, pay and save harmless Administrative Agent, each Issuing Lender and
each other Lender from and against any and all claims, demands, liabilities,
damages, losses, costs, charges and expenses (including reasonable fees,
expenses and disbursements of counsel and allocated costs of internal counsel)
which Administrative Agent, such Issuing Lender and each other Lender may incur
or be subject to as a consequence, direct or indirect, of (i) the issuance of
any Letter of Credit by such Issuing Lender, other than as a result of (a) the
gross negligence or willful misconduct of such Issuing Lender as determined by a
final judgment of a court of competent jurisdiction or (b) subject to the
following clause (ii), the wrongful dishonor by such Issuing Lender of a proper
demand for payment made under any Letter of Credit issued by it or (ii) the
failure of such Issuing Lender to honor a drawing under any such Letter of
Credit as a result of any act or omission, whether rightful or wrongful, of any
present or future de jure or de facto Government Authority (all such acts or
omissions herein called "GOVERNMENTAL ACTS").
B. NATURE OF ISSUING LENDERS' DUTIES. As between Borrower
nd any Issuing Lender or other Lender, Borrower assumes all risks of the acts
and omissions of, or misuse of the Letters of Credit issued by such Issuing
Lender by, the respective beneficiaries of such Letters of Credit. In
furtherance and not in limitation of the foregoing, such Issuing Lender and each
other Lender shall not be responsible for and Borrower's obligations in respect
of Letters of Credit shall not in any way be affected or impaired by: (i) the
form, validity, sufficiency, accuracy, genuineness or legal effect of any
document submitted by any party in connection with the application for and
issuance of any such Letter of Credit, even if it should in fact prove to be in
any or all respects invalid, insufficient, inaccurate, fraudulent or forged;
(ii) the validity or sufficiency of any instrument transferring or assigning or
purporting to transfer or assign any such Letter of Credit or the rights or
benefits thereunder or proceeds thereof, in whole or in part, which may prove to
be invalid or ineffective for any reason; (iii) failure of the beneficiary of
any such Letter of Credit to comply fully with any conditions required in order
to
61
draw upon such Letter of Credit; (iv) errors, omissions, interruptions or delays
in transmission or delivery of any messages, by mail, cable, telegraph, telex or
otherwise, whether or not they be in cipher; (v) errors in interpretation of
technical terms; (vi) any loss or delay in the transmission or otherwise of any
document required in order to make a drawing under any such Letter of Credit or
of the proceeds thereof; (vii) the misapplication by the beneficiary of any such
Letter of Credit of the proceeds of any drawing under such Letter of Credit; or
(viii) any consequences arising from causes beyond the control of such Issuing
Lender, including any Governmental Acts, and none of the above shall affect or
impair, or prevent the vesting of, any of such Issuing Lender's or any other
Lender's rights or powers hereunder.
In furtherance and extension and not in limitation of the
specific provisions set forth in the first paragraph of this subsection 3.5B,
any action taken or omitted by any Issuing Lender under or in connection with
the Letters of Credit issued by it or any documents and certificates delivered
thereunder, if taken or omitted in good faith, shall not put such Issuing Lender
or any other Lender under any resulting liability to Borrower.
Notwithstanding anything to the contrary contained in this
subsection 3.5, Borrower shall retain any and all rights it may have against any
Issuing Lender for any liability arising solely out of the gross negligence or
willful misconduct of such Issuing Lender, as determined by a final judgment of
a court of competent jurisdiction.
SECTION 4. CONDITIONS TO LOANS AND LETTERS OF CREDIT
The obligations of Lenders to make Loans and the issuance of
Letters of Credit hereunder are subject to the satisfaction of the following
conditions:
4.1 CONDITIONS TO INITIAL REVOLVING LOANS.
The obligations of Lenders to make any Revolving Loans to be
made on the Closing Date are, in addition to the conditions precedent specified
in subsection 4.2, subject to prior or concurrent satisfaction of the following
conditions:
A. LOAN PARTY DOCUMENTS. On or before the Closing Date,
Borrower shall, and shall cause each other Loan Party to, deliver to Lenders (or
to Administrative Agent with sufficient originally executed copies, where
appropriate, for each Lender) the following with respect to Borrower or such
Loan Party, as the case may be, each, unless otherwise noted, dated the Closing
Date:
(i) Copies of the Organizational Documents of such Person,
certified by the Secretary of State of its jurisdiction of organization
or, if such document is of a type that may not be so certified,
certified by the secretary or similar Officer of the applicable Loan
Party, together with a good standing certificate from the Secretary of
State of its jurisdiction of organization and the state in which such
Person has its principal place of business (if such Person is qualified
in such state) and, to the extent generally available, a certificate or
other evidence of good standing as to payment of any applicable
franchise
62
or similar taxes from the appropriate taxing authority of each of such
jurisdictions, each dated a recent date prior to the Closing Date;
(ii) Resolutions of the Governing Body of each Loan Party
approving and authorizing the execution, delivery and performance of
the Loan Documents to which it is a party, certified as of the Closing
Date by the secretary
or similar Officer of such Person as being in full force and effect
without modification or amendment;
(iii) Signature and incumbency certificates of the Officers
of each Loan Party executing the Loan Documents to which it is a party;
(iv) Executed originals of the Loan Documents to which each
Loan Party is a party; and
(v) Such other documents as Administrative Agent may
reasonably request.
B. NO MATERIAL ADVERSE EFFECT. Since December 31, 2001,
no Material Adverse Effect (in the reasonable opinion of Administrative Agent)
shall have occurred.
C. FEES. Borrower shall have paid to Administrative
Agent, for distribution (as appropriate) to Administrative Agent and Lenders,
the fees payable on the Closing Date referred to in subsection 2.3.
D. CAPITAL STRUCTURE. The capital structure of Borrower
shall be as set forth on Schedule 4.1D annexed hereto.
E. REPRESENTATIONS AND WARRANTIES; PERFORMANCE OF
AGREEMENTS. Borrower shall have delivered to Administrative Agent (for delivery
to Lenders) an Officer's Certificate, in form and substance reasonably
satisfactory to Administrative Agent, to the effect that the representations and
warranties in Section 5 and in the Pledge Agreement are true, correct and
complete in all material respects on and as of the Closing Date to the same
extent as though made on and as of that date (or, to the extent such
representations and warranties specifically relate to an earlier date, that such
representations and warranties were true, correct and complete in all material
respects on and as of such earlier date) and that Borrower shall have performed
in all material respects all agreements and satisfied all conditions which this
Agreement provides shall be performed or satisfied by it on or before the
Closing Date except as otherwise disclosed to and agreed to in writing by
Administrative Agent; provided that where a representation and warranty,
covenant or condition is qualified as to materiality, such materiality qualifier
shall be disregarded for purposes of this condition.
F. OPINIONS OF COUNSEL TO LOAN PARTIES. Lenders shall
have received originally executed copies of one or more favorable written
opinions of Xxxxxxx Xxxx & Xxxxxxxxx, counsel for Loan Parties, in form and
substance reasonably satisfactory to Administrative Agent and its counsel, dated
as of the Closing Date and setting forth substantially the matters in the
opinions designated in Exhibit VII annexed hereto (this Credit Agreement
constituting a written request by Borrower to such counsel to deliver such
opinions to Lenders).
63
G. OPINIONS OF ADMINISTRATIVE AGENT'S COUNSEL. Lenders
shall have received originally executed copies of one or more favorable written
opinions of O'Melveny & Xxxxx LLP, counsel to Administrative Agent, dated as of
the Closing Date, substantially in the form of Exhibit VIII annexed hereto,
which Lenders shall use commercially reasonable efforts to obtain on or before
the Closing Date.
H. INTENTIONALLY OMITTED.
I. EVIDENCE OF INSURANCE. Administrative Agent shall have
received a certificate from Borrower's insurance broker or other evidence
satisfactory to it that all insurance required to be maintained pursuant to
subsection 6.4 is in full force and effect and that Administrative Agent on
behalf of Lenders has been named as additional insured and/or loss payee
thereunder to the extent required under subsection 6.4.
J. Necessary Governmental Authorizations and Consents;
Expiration of Waiting Periods, Etc. Borrower shall have obtained all
Governmental Authorizations and all consents of other Persons, in each case that
are necessary or advisable in connection with the transactions contemplated by
the Loan Documents and the continued operation of the business conducted by
Borrower and its Subsidiaries in substantially the same manner as conducted
prior to the Closing Date. Each such Governmental Authorization or consent shall
be in full force and effect, except in a case where the failure to obtain or
maintain a Governmental Authorization or consent, either individually or in the
aggregate, could not reasonably be expected to result in a Material Adverse
Effect. All applicable waiting periods shall have expired without any action
being taken or threatened by any competent authority that would restrain,
prevent or otherwise impose adverse conditions on the transactions contemplated
by the Loan Documents. No action, request for stay, petition for review or
rehearing, reconsideration, or appeal with respect to any of the foregoing shall
be pending, and the time for any applicable Government Authority to take action
to set aside its consent on its own motion shall have expired.
K. Security Interests in Capital Stock. Administrative
Agent shall have received evidence satisfactory to it that Borrower and
Subsidiary Guarantors shall have taken or caused to be taken all such actions,
executed and delivered or caused to be executed and delivered all such
agreements, documents and instruments, and made or caused to be made all such
filings and recordings that may be necessary or, in the reasonable opinion of
Administrative Agent, desirable in order to create in favor of Administrative
Agent, for the benefit of Lenders, a valid and (upon such filing and recording)
First Priority Lien on the Collateral. Such actions shall include the following:
(i) Schedules to Collateral Documents. Delivery to
Administrative Agent of accurate and complete schedules to all of the
applicable Collateral Documents;
(ii) Stock Certificates. Delivery to Administrative Agent
of certificates (which certificates shall be accompanied by irrevocable
undated stock powers, duly endorsed in blank and otherwise reasonably
satisfactory in form and substance to Administrative Agent)
representing all Capital Stock evidenced by certificates pledged
pursuant to the Pledge Agreement; and
64
(iii) Lien Searches and UCC Termination Statements. Delivery
to Administrative Agent of (a) the results of a recent search, by a
Person satisfactory to Administrative Agent, of all effective UCC
financing statements, all judgment and tax lien filings which may have
been made with respect to any personal or mixed property of any Loan
Party, together with copies of all such filings disclosed by such
search, and (b) UCC termination statements duly executed by all
applicable Persons for filing in all applicable jurisdictions as may be
necessary to terminate any effective UCC financing statements disclosed
in such search (other than any such financing statements in respect of
Liens permitted to remain outstanding pursuant to the terms of this
Agreement).
L. MATTERS RELATING TO EXISTING INDEBTEDNESS OF BORROWER
AND ITS SUBSIDIARIES.
(i) Termination of Existing Credit Agreements and Related
Liens; Existing Letters of Credit. Borrower and its Subsidiaries shall
have (a) repaid in full all Indebtedness outstanding under the Existing
Credit Agreement (the aggregate principal amount of which Indebtedness
shall not exceed $0), (b) terminated any commitments to lend or make
other extensions of credit thereunder, (c) delivered to Administrative
Agent all documents or instruments necessary to release all Liens
securing Indebtedness or other obligations of Borrower and its
Subsidiaries thereunder, and (d) made arrangements satisfactory to
Administrative Agent with respect to the cancellation of any letters of
credit outstanding thereunder or the issuance of Letters of Credit to
support the obligations of Borrower and its Subsidiaries with respect
thereto.
(ii) Notice of Redemption. On or before the Closing Date,
Borrower shall have delivered to Administrative Agent evidence
reasonably satisfactory to Administrative Agent that the Borrower has
provided irrevocable notice to the trustee of the 9.25% First Mortgage
Notes of Borrower's election to redeem the 9.25% First Mortgage Notes
within forty five (45) days after the Closing Date (or if such day is
not a Business Day, the next Business Day).
(iii) Existing Indebtedness to Remain Outstanding.
Administrative Agent shall have received an Officer's Certificate of
Borrower stating that, after giving effect to the transactions
described in this subsection 4.1L, the Indebtedness of Loan Parties
(other than Indebtedness under the Loan Documents) shall consist of
approximately $216,692,007 in aggregate principal amount of outstanding
Indebtedness described in Part I of Schedule 7.1 annexed hereto. The
terms and conditions of all such Indebtedness shall be in form and in
substance satisfactory to Administrative Agent.
M. COMPLETION OF PROCEEDINGS. All corporate and other
proceedings, taken or to be taken in connection with the transactions
contemplated hereby and all documents incidental thereto not previously
found acceptable by Administrative Agent, acting on behalf of Lenders,
and its counsel shall be satisfactory in form and substance to
Administrative Agent and such counsel, and Administrative Agent and
such counsel shall have received all such counterpart originals or
certified copies of such documents as Administrative Agent may
reasonably request.
65
N. BORROWING BASE CERTIFICATE. Borrower shall have
delivered to Administrative Agent a Borrowing Base Certificate, which
shall be satisfactory to Administrative Agent, prepared as of May 31,
2002.
4.2 CONDITIONS TO ALL LOANS.
The obligations of Lenders to make Loans on each Funding Date
are subject to the following further conditions precedent:
A. Administrative Agent shall have received before that
Funding Date, in accordance with the provisions of subsection 2.1B, an executed
Notice of Borrowing, in each case signed by a duly authorized Officer of
Borrower.
B. As of that Funding Date:
(i) The representations and warranties contained herein
and in the other Loan Documents shall be true, correct and complete in
all material respects on and as of that Funding Date to the same extent
as though made on and as of that date, except (A) to the extent such
representations and warranties specifically relate to an earlier date,
in which case such representations and warranties shall have been true,
correct and complete in all material respects on and as of such earlier
date and (B) to the extent the Administrative Agent and Lenders have
been notified in writing by Borrower that any representation or
warranty is not correct and the Requisite Lenders have explicitly
waived in writing compliance with such representation or warranty;
provided, that where a representation and warranty is already qualified
as to materiality, such materiality qualifier shall be disregarded for
purposes of this condition;
(ii) No event shall have occurred and be continuing or
would result from the consummation of the borrowing contemplated by
such Notice of Borrowing that would constitute an Event of Default or a
Potential Event of Default;
(iii) Each Loan Party shall have performed in all material
respects all agreements and satisfied all conditions which this
Agreement provides shall be performed or satisfied by it on or before
that Funding Date;
(iv) No order, judgment or decree of any arbitrator or
Government Authority shall purport to enjoin or restrain any Lender
from making the Loans to be made by it on that Funding Date;
(v) The making of the Loans requested on such Funding Date
shall not violate any law including Regulation T, Regulation U or
Regulation X of the Board of Governors of the Federal Reserve System;
and
(vi) There shall not be pending or, to the knowledge of
Borrower, threatened, any action, suit, proceeding, governmental
investigation or arbitration against or affecting Borrower or any of
its Subsidiaries or any property of Borrower or any of its Subsidiaries
66
that has not been disclosed by Borrower in writing pursuant to
subsection 5.6 or 6.1(viii) prior to the making of the last preceding
Loans (or, in the case of the initial Loans, prior to the execution of
this Agreement), and there shall have occurred no development not so
disclosed in any such action, suit, proceeding, governmental
investigation or arbitration so disclosed, that, in either event, in
the reasonable opinion of Administrative Agent or of Requisite Lenders,
could reasonably be expected to have a Material Adverse Effect; and no
injunction or other restraining order shall have been issued and no
hearing to cause an injunction or other restraining order to be issued
shall be pending or noticed with respect to any action, suit or
proceeding seeking to enjoin or otherwise prevent the consummation of,
or to recover any damages or obtain relief as a result of, the
transactions contemplated by this Agreement or the making of Loans
hereunder.
4.3 CONDITIONS TO LETTERS OF CREDIT.
The issuance of any Letter of Credit hereunder (whether or not
the applicable Issuing Lender is obligated to issue such Letter of Credit) and
the renewal of any Letter of Credit hereunder is subject to the following
conditions precedent:
A. On or before the date of issuance of the initial
Letter of Credit pursuant to this Agreement, the initial Loans shall have been
made.
B. On or before the date of issuance of such Letter of
Credit, Administrative Agent shall have received, in accordance with the
provisions of subsection 3.1, a Notice of Issuance (or a facsimile copy thereof)
in each case signed by a duly authorized Officer of Borrower, together with all
other information specified in subsection 3.1 and such other documents or
information as the applicable Issuing Lender may reasonably require in
connection with the issuance of such Letter of Credit.
C. On the date of issuance of such Letter of Credit, all
conditions precedent described in subsection 4.2B shall be satisfied to the same
extent as if the issuance of such Letter of Credit were the making of a Loan and
the date of issuance of such Letter of Credit were a Funding Date.
SECTION 5. BORROWER'S REPRESENTATIONS AND WARRANTIES
In order to induce Lenders to enter into this Agreement and to
make the Loans, to induce Issuing Lenders to issue Letters of Credit and to
induce other Lenders to purchase participations therein, Borrower represents and
warrants to each Lender that:
5.1 ORGANIZATION, POWERS, QUALIFICATION, GOOD STANDING, BUSINESS
AND SUBSIDIARIES.
A. ORGANIZATION AND POWERS. Each Loan Party is a
corporation, partnership, trust or limited liability company duly organized,
validly existing and in good standing under the laws of its jurisdiction of
organization as specified in Schedule 5.1 annexed hereto. Each Loan Party has
all requisite power and authority to own and operate its properties,
67
to carry on its business as now conducted and as proposed to be conducted, to
enter into the Loan Documents to which it is a party and to carry out the
transactions contemplated thereby.
B. QUALIFICATION AND GOOD STANDING. Each Loan Party is
qualified to do business and in good standing in every jurisdiction where its
assets are located and wherever necessary to carry out its business and
operations, except in jurisdictions where the failure to be so qualified or in
good standing has not had and could not reasonably be expected to result in a
Material Adverse Effect.
C. CONDUCT OF BUSINESS. Borrower and its Subsidiaries are
engaged only in the businesses permitted to be engaged in pursuant to subsection
7.9.
D. SUBSIDIARIES. All of the Subsidiaries of Borrower as
of the Closing Date and their jurisdictions of organization are identified in
Schedule 5.1 annexed hereto. The Capital Stock of each of the Subsidiaries of
Borrower identified in Schedule 5.1 annexed hereto is duly authorized, validly
issued, fully paid and nonassessable and none of such Capital Stock constitutes
Margin Stock. Each of the Subsidiaries of Borrower identified in Schedule 5.1
annexed hereto (except for any such Subsidiary the existence of which may
hereafter be terminated as permitted by this Agreement) is a corporation,
partnership, trust or limited liability company duly organized, validly existing
and in good standing under the laws of its respective jurisdiction of
organization set forth therein, has all requisite power and authority to own and
operate its properties and to carry on its business as now conducted and as
proposed to be conducted, to enter into the Loan Documents to which it is a
party and to carry out the transactions contemplated thereby, and is qualified
to do business and in good standing in every jurisdiction where its assets are
located and wherever necessary to carry out its business and operations, in each
case except where failure to be so qualified or in good standing or a lack of
such power and authority has not had and could not reasonably be expected to
result in a Material Adverse Effect. Schedule 5.1 annexed hereto correctly sets
forth, as of the Closing Date, the ownership interest of Borrower and each of
its Subsidiaries in each of the Subsidiaries of Borrower identified therein.
5.2 AUTHORIZATION OF BORROWING, ETC.
A. AUTHORIZATION OF BORROWING. The execution, delivery
and performance of the Loan Documents and the carrying out of the transactions
contemplated thereby have been duly authorized by all necessary action on the
part of each Loan Party that is a party thereto.
B. NO CONFLICT. The execution, delivery and performance
by Loan Parties of the Loan Documents to which they are parties and the
consummation of the transactions contemplated by the Loan Documents do not and
will not (i) violate any provision of any law or any governmental rule or
regulation applicable to Borrower or any of its Subsidiaries, the Organizational
Documents of Borrower or any of its Subsidiaries or any order, judgment or
decree of any court or other Government Authority binding on Borrower or any of
its Subsidiaries, (ii) conflict with, result in a breach of or constitute (with
due notice or lapse of time or both) a default under any Contractual Obligation
of Borrower or any of its Subsidiaries, (iii) result in or require the creation
or imposition of any Lien upon any of the properties or assets
68
of Borrower or any of its Subsidiaries (other than any Liens created under any
of the Loan Documents in favor of Administrative Agent on behalf of Lenders),
(iv) require any approval of stockholders or any approval or consent of any
Person under any Contractual Obligation of Borrower or any of its Subsidiaries,
except for such approvals or consents which will be obtained on or before the
Closing Date and disclosed in writing to Lenders, or (v) conflict with, result
in a breach of or constitute (with due notice or lapse of time or both) a
default under any other contractual obligation of Borrower or any of its
Subsidiaries, which conflicts, breaches or defaults as described in (i) through
(v) herein, individually or in the aggregate, could reasonably be expected to
have a Material Adverse Effect.
C. GOVERNMENTAL CONSENTS. The execution, delivery and
performance by Loan Parties of the Loan Documents to which they are parties and
the consummation of the transactions contemplated by the Loan Documents do not
and will not require registration with, consent or approval of, or notice to, or
other action to, with or by, any Governmental Authority except for such of the
foregoing that will have been made or obtained on or before the Closing Date.
D. BINDING OBLIGATION. Each of the Loan Documents has been
duly executed and delivered by each Loan Party that is a party thereto and is
the legally valid and binding obligation of such Loan Party, enforceable against
such Loan Party in accordance with its respective terms, except as may be
limited by bankruptcy, insolvency, reorganization, moratorium or similar laws
relating to or limiting creditors' rights generally or by equitable principles
relating to enforceability.
5.3 FINANCIAL CONDITION.
Borrower has heretofore delivered to Lenders, at Lenders'
request, the audited consolidated balance sheet of the Borrower and its
Subsidiaries as at December 31, 2001 and the related consolidated statements of
income and cash flows of the Borrower and its Subsidiaries for the year then
ended and the unaudited consolidated balance sheet of the Borrower and its
Subsidiaries as at March 31, 2002 and the related consolidated statements of
income and cash flows of the Borrower and its Subsidiaries for the three months
then ended. All such statements were prepared in conformity with GAAP and fairly
present, in all material respects, the financial condition (on a consolidated
basis) of the entities described in such financial statements as at the
respective dates thereof and the results of operations and cash flows (on a
consolidated basis) of the entities described therein for each of the periods
then ended, subject, in the case of any such unaudited financial statements, to
changes resulting from audit and normal year-end adjustments. No Loan Party has
(and will not have following the funding of the initial Loans) any Contingent
Obligation, contingent liability or liability for taxes, long-term lease or
unusual forward or long-term commitment that, as of the Closing Date, is not
reflected in the foregoing financial statements or the notes thereto and, as of
any Funding Date subsequent to the Closing Date, is not reflected in the most
recent financial statements delivered to Lenders pursuant to subsection 6.1 or
the notes thereto and that, in any such case, is material in relation to the
business, operations, properties, assets or condition (financial or otherwise)
of Borrower or any of its Subsidiaries.
69
5.4 NO MATERIAL ADVERSE CHANGE; NO RESTRICTED JUNIOR PAYMENTS.
Since December 31, 2001, no event or change has occurred that
has resulted in or evidences, either in any case or in the aggregate, a Material
Adverse Effect. Since December 31, 2001, neither Borrower nor any of its
Subsidiaries has directly or indirectly declared, ordered, paid or made, or set
apart any sum or property for, any Restricted Junior Payment or agreed to do so
except as permitted by subsection 7.3.
5.5 TITLE TO PROPERTIES; LIENS; REAL PROPERTY; INTELLECTUAL
PROPERTY.
A. Title to Properties; Liens. Borrower and its
Subsidiaries have (i) good, sufficient and legal title to (in the case of fee
interests in real property), (ii) valid leasehold interests in (in the case of
leasehold interests in real or personal property), or (iii) good title to (in
the case of all other personal property), all of their respective properties
material to their businesses reflected in the financial statements referred to
in subsection 5.3 or in the most recent financial statements delivered pursuant
to subsection 6.1, in each case except for (i) property disposed of since the
date of such financial statements in the ordinary course of business and (ii)
minor defects in title that do not interfere with their ability to conduct their
business as currently conducted or to utilize such properties for their intended
purposes. Except as permitted by this Agreement, all such properties are free
and clear of Liens.
B. INTELLECTUAL PROPERTY. As of the Closing Date, Borrower and
its Subsidiaries own or have the right to use all Intellectual Property used or
necessary in the conduct of their business, except where the failure to own or
have such right to use, individually or in the aggregate, could not reasonably
be expected to result in a Material Adverse Effect. No claim has been asserted
and is pending by any Person challenging or questioning the use of any such
Intellectual Property or the validity or effectiveness of any such Intellectual
Property, nor does Borrower know of any valid basis for any such claim except
for such claims that individually or in the aggregate could not reasonably be
expected to result in a Material Adverse Effect. The use of such Intellectual
Property by any Loan Party does not infringe on the rights of any Person, except
for such claims and infringements that, individually or in the aggregate, could
not reasonably be expected to result in a Material Adverse Effect. All federal
and state and all foreign registrations of and applications for Intellectual
Property, and all unregistered Intellectual Property other than trade secrets
and know-how, that are owned or licensed by Borrower or any of its Subsidiaries
on the Closing Date are described on Schedule 5.5 annexed hereto.
5.6 LITIGATION; ADVERSE FACTS.
Except as set forth in Note 8 of the Consolidated Financial
Statements filed in the Borrower's Form 10-K for the period ended December 31,
2001, there are no Proceedings (whether or not purportedly on behalf of Borrower
or any of its Subsidiaries) at law or in equity, or before or by any court or
other Government Authority (including any Environmental Claims), that are
pending or, to the knowledge of Borrower, threatened against or affecting
Borrower or any of its Subsidiaries or any property of Borrower or any of its
Subsidiaries and that, individually or in the aggregate, could reasonably be
expected to result in a Material Adverse Effect. Neither Borrower nor any of its
Subsidiaries (i) is in violation of any applicable laws
70
that, individually or in the aggregate, could reasonably be expected to result
in a Material Adverse Effect, or (ii) is subject to or in default with respect
to any final judgments, writs, injunctions, decrees, rules or regulations of any
court or other Government Authority, that, individually or in the aggregate,
could reasonably be expected to result in a Material Adverse Effect.
5.7 PAYMENT OF TAXES.
Except to the extent permitted by subsection 6.3, all income tax returns and all
other material tax returns and material reports of Borrower and its Subsidiaries
required to be filed by any of them have been timely filed or extended, and all
material taxes shown on such tax returns to be due and payable and all material
assessments, fees and other governmental charges upon Borrower and its
Subsidiaries and upon their respective properties, assets, income, businesses
and franchises that are due and payable have been paid when due and payable.
Borrower knows of no proposed tax assessment against Borrower or any of its
Subsidiaries that is not being actively contested by Borrower or such Subsidiary
in good faith and by appropriate proceedings; provided that such reserves or
other appropriate provisions, if any, as shall be required in conformity with
GAAP shall have been made or provided therefor. Borrower knows of no proposed
tax assessment against Borrower or any of its Subsidiaries that is not being
actively contested by Borrower or such Subsidiary in good faith and by
appropriate proceedings.
5.8 PERFORMANCE OF AGREEMENTS; MATERIALLY ADVERSE AGREEMENTS.
A. Neither Borrower nor any of its Subsidiaries is in
default in the performance, observance or fulfillment of any of the obligations,
covenants or conditions contained in any of its Contractual Obligations, and no
condition exists that, with the giving of notice or the lapse of time or both,
would constitute such a default, except where the consequences, direct or
indirect, of such default or defaults, if any, individually or in the aggregate,
could not reasonably be expected to have a Material Adverse Effect.
B. Neither Borrower nor any of its Subsidiaries is a
party to or is otherwise subject to any agreements or instruments or any charter
or other internal restrictions or any provision of any applicable law, rule or
regulation which, individually or in the aggregate, could reasonably be expected
to result in a Material Adverse Effect.
5.9 GOVERNMENTAL REGULATION.
Neither Borrower nor any of its Subsidiaries is subject to
regulation under the Public Utility Holding Company Act of 1935, the Federal
Power Act, the Interstate Commerce Act or the Investment Company Act of 1940 or
under any other federal or state statute or regulation which may limit its
ability to incur Indebtedness or which may otherwise render all or any portion
of the Obligations unenforceable.
71
5.10 SECURITIES ACTIVITIES.
A. Neither Borrower nor any of its Subsidiaries is
engaged principally, or as one of its important activities, in the business of
extending credit for the purpose of purchasing or carrying any Margin Stock.
B. Following application of the proceeds of each Loan,
not more than 25% of the value of the assets (either of Borrower only or of
Borrower and its Subsidiaries on a consolidated basis) subject to the provisions
of subsection 7.2 or 7.5 or subject to any restriction contained in any
agreement or instrument, between Borrower and any Lender or any Affiliate of any
Lender, relating to Indebtedness and within the scope of subsection 8.2, will be
Margin Stock.
5.11 EMPLOYEE BENEFIT PLANS.
Except to the extent that any of the following, individually
or together, could not reasonably be expected to have a Material Adverse Effect:
A. Borrower, each of its Subsidiaries and each of their
respective ERISA Affiliates are in compliance with all applicable provisions and
requirements of ERISA and the regulations and published interpretations
thereunder with respect to each Employee Benefit Plan, and have performed all
their obligations under each Employee Benefit Plan. Each Employee Benefit Plan
that is intended to qualify under Section 401(a) of the Internal Revenue Code is
so qualified.
B. No ERISA Event has occurred or is reasonably expected
to occur.
C. Except to the extent required under Section 4980B of
the Internal Revenue Code, no Employee Benefit Plan provides health or welfare
benefits (through the purchase of insurance or otherwise) for any retired or
former employee of Borrower, any of its Subsidiaries or any of their respective
ERISA Affiliates.
D. As of the most recent valuation date for any Pension
Plan, the amount of unfunded benefit liabilities (as defined in Section
4001(a)(18) of ERISA), individually or in the aggregate for all Pension Plans
(excluding for purposes of such computation any Pension Plans with respect to
which assets exceed benefit liabilities), does not exceed $1,000,000.
E. As of the most recent valuation date for each
Multiemployer Plan for which the actuarial report is available, the potential
liability of Borrower, its Subsidiaries and their respective ERISA Affiliates
for a complete withdrawal from such Multiemployer Plan (within the meaning of
Section 4203 of ERISA), when aggregated with such potential liability for a
complete withdrawal from all Multiemployer Plans, based on information available
pursuant to Section 4221(e) of ERISA, does not exceed $2,000,000.
72
5.12 CERTAIN FEES.
No broker's or finder's fee or commission will be payable by
any Loan Party with respect to this Agreement or any of the transactions
contemplated by the Loan Documents, and Borrower hereby indemnifies Lenders
against, and agrees that it will hold Lenders harmless from, any claim, demand
or liability for any such broker's or finder's fees payable by any Loan Party
alleged to have been incurred in connection herewith or therewith and any
expenses (including reasonable fees, expenses and disbursements of counsel)
arising in connection with any such claim, demand or liability.
5.13 ENVIRONMENTAL PROTECTION.
Except to the extent that any of the following, individually
or together, could not reasonably be expected to result in a Material Adverse
Effect:
(i) neither Borrower nor any of its Subsidiaries nor any
of their respective Facilities or operations are subject to any
outstanding written order, consent decree or settlement agreement with
any Person relating to (a) any Environmental Law, (b) any Environmental
Claim, or (c) any Hazardous Materials Activity;
(ii) neither Borrower nor any of its Subsidiaries has
received any letter or written request for information under Section
104 of the Comprehensive Environmental Response, Compensation, and
Liability Act (42 X.X.X.xx. 9604) or any comparable state law;
(iii) there are and, to Borrower's knowledge, have been no
conditions, occurrences, or Hazardous Materials Activities that could
reasonably be expected to form the basis of an Environmental Claim
against Borrower or any of its Subsidiaries;
(iv) neither Borrower nor any of its Subsidiaries nor, to
Borrower's knowledge, any predecessor of Borrower or any of its
Subsidiaries has filed any notice under any Environmental Law
indicating past or present treatment of Hazardous Materials at any
Facility, and none of Borrower's or any of its Subsidiaries' operations
involves the generation, transportation, treatment, storage or disposal
of hazardous waste as defined under 40 C.F.R. Parts 260-270 or any
state equivalent;
(v) Borrower and its Subsidiaries have complied with all
current or reasonably foreseeable future requirements pursuant to or
under Environmental Laws;
(vi) To Borrower's and each of its Subsidiaries' knowledge,
all Real Property Assets and all operations of Borrower and its
Subsidiaries are in compliance, and have in the last five years been
compliance, with Environmental Laws; and
(vii) No judicial proceeding or action by any Governmental
Authority is pending, or to the knowledge of Borrower and each of its
Subsidiaries, threatened under
73
any Environmental Law to which Borrower or any of its Subsidiaries is
or will be named as a party.
Notwithstanding anything in this subsection 5.13 to the contrary, no
event or condition has occurred or is occurring with respect to Borrower or any
of its Subsidiaries relating to any Environmental Law, any Release of Hazardous
Materials, or any Hazardous Materials Activity, including any matter disclosed
on Schedule 5.13 annexed hereto, which individually or in the aggregate has had
or could reasonably be expected to have a Material Adverse Effect.
5.14 EMPLOYEE MATTERS.
There is no strike or work stoppage in existence or, to the
Borrower's knowledge, threatened involving Borrower or any of its Subsidiaries
that could reasonably be expected to result in a Material Adverse Effect, and
there are no strikes or walkouts in progress, pending or to Borrower's knowledge
contemplated relating to any labor contracts to which Borrower or any of its
Subsidiaries is a party, relating to any labor contracts being negotiated, or
otherwise that could reasonably be expected to have, either individually or in
the aggregate, a Material Adverse Effect.
5.15 SOLVENCY.
Borrower and the Subsidiary Guarantors taken together as a
whole, are and, upon the incurrence of any Obligations by Borrower and its
Subsidiaries on any date on which this representation is made, will be, Solvent.
5.16 MATTERS RELATING TO COLLATERAL.
A. CREATION, PERFECTION AND PRIORITY OF LIENS. The
execution and delivery of the Collateral Documents by Loan Parties, together
with (i) the actions taken on or prior to the date hereof pursuant to
subsections 4.1K, and 6.8 and (ii) the delivery to Administrative Agent of any
Pledged Collateral not delivered to Administrative Agent at the time of
execution and delivery of the applicable Collateral Document (all of which
Pledged Collateral has been so delivered) are effective to create in favor of
Administrative Agent for the benefit of Lenders, as security for the respective
Secured Obligations (as defined in the applicable Collateral Document in respect
of any Collateral), a valid First Priority Lien (except for Liens permitted by
subsection 7.2A) on all of the Collateral, and all filings and other actions
necessary or desirable to perfect and maintain the First Priority status of such
Liens have been duly made or taken and remain in full force and effect.
B. GOVERNMENTAL AUTHORIZATIONS. No authorization,
approval or other action by, and no notice to or filing with, any Government
Authority is required for either (i) the pledge or grant by any Loan Party of
the Liens purported to be created in favor of Administrative Agent for the
benefit of Lenders pursuant to any of the Collateral Documents or (ii) the
exercise by Administrative Agent of any rights or remedies in respect of any
Collateral (whether specifically granted or created pursuant to any of the
Collateral Documents or created or
74
provided for by applicable law), except as may be required, in connection with
the disposition of any Pledged Collateral, by laws generally affecting the
offering and sale of securities.
C. ABSENCE OF THIRD-PARTY FILINGS. No effective UCC
financing statement, fixture filing or other instrument similar in effect
covering all or any part of the Collateral is on file in any filing or recording
office.
D. MARGIN REGULATIONS. The pledge of the Pledged
Collateral pursuant to the Collateral Documents does not violate Regulation T, U
or X of the Board of Governors of the Federal Reserve System.
E. INFORMATION REGARDING COLLATERAL. Except as set forth
in Schedule 5.16, all information supplied to Administrative Agent by or on
behalf of any Loan Party with respect to any of the Collateral (in each case
taken as a whole with respect to any particular Collateral) is accurate and
complete in all material respects. Except as set forth in Schedule 5.16, neither
the Borrower nor any of the Subsidiaries has within the six year period
immediately preceding the date of this Agreement changed its name, been the
surviving entity of a merger or consolidation, or acquired all or substantially
all of the assets of any Person.
5.17 DISCLOSURE.
No representation or warranty of any Loan Party in any Loan
Document to which it is a party or in any other document, certificate or written
statement furnished to Lenders by or on behalf of any Loan Party for use in
connection with the transactions contemplated by this Agreement, when taken as a
whole with other Loan Documents and this Agreement, contains any untrue
statement of a material fact or omits to state a material fact (known to
Borrower, in the case of any document not furnished by it) necessary in order to
make the statements contained herein or therein not misleading in light of the
circumstances in which the same were made. Any projections and pro forma
financial information contained in such materials are based upon good faith
estimates and assumptions believed by Borrower to be reasonable at the time
made, it being recognized by Lenders that such projections as to future events
are not to be viewed as facts and that actual results during the period or
periods covered by any such projections may differ from the projected results.
There are no facts known (or which should upon the reasonable exercise of
diligence be known) to Borrower (other than matters of a general economic
nature) that, individually or in the aggregate, could reasonably be expected to
result in a Material Adverse Effect and that have not been disclosed herein or
in such other documents, certificates and statements furnished to Lenders for
use in connection with the transactions contemplated hereby.
5.18 SUBORDINATED INDEBTEDNESS.
The subordination provisions of the Subordinated Indebtedness
are enforceable against the holders thereof. The Obligations are "Senior Debt"
and "Designated Senior Debt" as those terms are used the Subordinated
Indebtedness and constitute senior indebtedness that is entitled to the benefits
of the subordination provisions, if any, of all Subordinated Indebtedness of
Borrower and its Subsidiaries.
75
5.19 PROCEEDS OF LOAN.
The proceeds of the Loans will be used solely by Borrower for
the purposes set forth in Section 2.5.
SECTION 6. BORROWER'S AFFIRMATIVE COVENANTS
Borrower covenants and agrees that, so long as any of the
Commitments hereunder shall remain in effect and until payment in full of all of
the Loans and other Obligations and the cancellation or expiration of all
Letters of Credit, unless Requisite Lenders shall otherwise give prior written
consent, Borrower shall perform, and shall cause each of its Subsidiaries to
perform, all covenants in this Section 6.
6.1 FINANCIAL STATEMENTS AND OTHER REPORTS.
Borrower will maintain, and cause each of its Subsidiaries to
maintain, a system of accounting established and administered in accordance with
sound business practices to permit preparation of financial statements in
conformity with GAAP. Borrower will deliver to Administrative Agent and Lenders:
(i) Monthly Borrowing Base Certificate: as soon as
available and in any event within 30 days after the end of each month,
a Borrowing Base Certificate;
(ii) Quarterly Financials: as soon as available and in any
event within 45 days after the end of each of the first three Fiscal
Quarters of each Fiscal Year, (a) the consolidated balance sheet of
Borrower and its Subsidiaries as at the end of such Fiscal Quarter and
the related consolidated statements of income and cash flows of
Borrower and its Subsidiaries for such Fiscal Quarter and for the
period from the beginning of the then current Fiscal Year to the end of
such Fiscal Quarter, setting forth in each case in comparative form the
corresponding figures for the corresponding dates and periods of the
previous Fiscal Year, all in reasonable detail and certified by the
chief financial officer of Borrower that they fairly present, in all
material respects, the financial condition of Borrower and its
Subsidiaries as at the dates indicated and the results of their
operations and their cash flows for the periods indicated, subject to
changes resulting from audit and normal year-end adjustments and (b) a
narrative report describing the operations of Borrower and its
Subsidiaries for such Fiscal Quarter and for the period from the
beginning of the then current Fiscal Year to the end of such Fiscal
Quarter (it being agreed that the Borrower may satisfy its obligations
under clauses (a) and (b) by delivering its Quarterly Report on Form
10-Q for such Fiscal Quarter);
(iii) Year-End Financials: as soon as available and in any
event within 90 days after the end of each Fiscal Year, (a) the
consolidated balance sheet of Borrower and its Subsidiaries as at the
end of such Fiscal Year and the related consolidated statements of
income and cash flows of Borrower and its Subsidiaries for such Fiscal
Year, setting forth in each case in comparative form the corresponding
figures as of the end of and for the previous Fiscal Year, all in
reasonable detail and certified by the chief financial
76
officer of Borrower that they fairly present, in all material respects,
the financial condition of Borrower and its Subsidiaries as at the
dates indicated and the results of their operations and their cash
flows for the periods indicated, (b) a narrative report describing the
operations of Borrower and its Subsidiaries for such Fiscal Year, (c) a
report thereon of a nationally recognized "big 4" accounting firm or
other independent certified public accountants of recognized national
standing selected by Borrower and satisfactory to Administrative Agent,
which report shall be unqualified, shall express no doubts about the
ability of Borrower and its Subsidiaries to continue as a going
concern, and shall state that such consolidated financial statements
fairly present, in all material respects, the consolidated financial
position of Borrower and its Subsidiaries as at the dates indicated and
the results of their operations and their cash flows for the periods
indicated in conformity with GAAP applied on a basis consistent with
prior years (except as otherwise disclosed in such financial
statements) and that the examination by such accountants in connection
with such consolidated financial statements has been made in accordance
with generally accepted auditing standards (it being agreed that
Borrower may satisfy its obligations under clauses (a) and (b) by
delivering its Annual Report on Form 10-K for such Fiscal Year);
(iv) Officer and Compliance Certificates: together with
each delivery of financial statements of Borrower and its Subsidiaries
pursuant to subdivisions (ii) and (iii) above, (a) an Officer's
Certificate of Borrower stating that the signers have reviewed the
terms of this Agreement and have made, or caused to be made under their
supervision, a review in reasonable detail of the transactions and
condition of Borrower and its Subsidiaries during the accounting period
covered by such financial statements and that such review has not
disclosed the existence during or at the end of such accounting period,
and that the signers do not have knowledge of the existence as at the
date of such Officer's Certificate, of any condition or event that
constitutes an Event of Default or Potential Event of Default, or, if
any such condition or event existed or exists, specifying the nature
and period of existence thereof and what action Borrower has taken, is
taking and proposes to take with respect thereto; and (b) a Compliance
Certificate demonstrating in reasonable detail compliance during and at
the end of the applicable accounting periods with the restrictions
contained in Section 7, in each case to the extent compliance with such
restrictions is required to be tested at the end of the applicable
accounting period;
(v) Reconciliation Statements: if, as a result of any
change in accounting principles and policies from those used in the
preparation of the audited financial statements referred to in
subsection 5.3, the consolidated financial statements of Borrower and
its Subsidiaries delivered pursuant to subdivision (ii) or (iii) of
this subsection 6.1 will differ in any material respect from the
consolidated financial statements that would have been delivered
pursuant to such subdivisions had no such change in accounting
principles and policies been made, then (a) together with the first
delivery of financial statements pursuant to subdivision (ii) or (iii)
of this subsection 6.1 following such change, consolidated financial
statements of Borrower and its Subsidiaries for (y) the current Fiscal
Year to the effective date of such change and
77
(z) the two full Fiscal Years immediately preceding the Fiscal Year in
which such change is made, in each case prepared on a pro forma basis
as if such change had been in effect during such periods, and (b)
together with each delivery of financial statements pursuant to
subdivision (ii) or (iii) of this subsection 6.1 following such change,
if required pursuant to subsection 1.2, a written statement of the
chief accounting officer or chief financial officer of Borrower setting
forth the differences (including any differences that would affect any
calculations relating to the financial covenants set forth in
subsection 7.4) which would have resulted if such financial statements
had been prepared without giving effect to such change;
(vi) Accountants' Reports: promptly upon receipt thereof
(unless restricted by applicable professional standards), copies of all
reports submitted to Borrower by independent certified public
accountants in connection with each annual, interim or special audit of
the consolidated financial statements of Borrower and its Subsidiaries
made by such accountants, including any comment letter submitted by
such accountants to management in connection with their annual audit;
(vii) SEC Filings and Press Releases: promptly upon their
becoming available, copies of (a) all financial statements, reports,
notices and proxy statements sent or made available generally by
Borrower to its security holders or by any Subsidiary of Borrower to
its security holders other than Borrower or another Subsidiary of
Borrower and (b) all regular and periodic reports and all registration
statements (other than on Form S-8 or a similar form) and prospectuses,
if any, filed by Borrower or any of its Subsidiaries with any
securities exchange or with the Securities and Exchange Commission or
any Governmental Authority or private regulatory authority;
(viii) Litigation or Other Proceedings: promptly upon, but in
any event within five Business Days after, any executive officer of
Borrower obtaining knowledge of (1) the institution of, or
non-frivolous threat of, any Proceeding against or affecting Borrower
or any of its Subsidiaries or any property of Borrower or any of its
Subsidiaries not previously disclosed in writing by Borrower to Lenders
or (2) any material development in any Proceeding that, in any case:
(x) if adversely determined, has a
reasonable possibility of giving rise to a Material
Adverse Effect; or
(y) seeks to enjoin or otherwise prevent
the consummation of, or to recover any damages or
obtain relief as a result of, the transactions
contemplated hereby;
written notice thereof together with such other information as may be reasonably
available to Borrower to enable Lenders and their counsel to evaluate such
matters and (b) within forty-five days after the end of each Fiscal Quarter, a
schedule of all Proceedings (other than any Proceeding as to which a solvent and
unaffiliated insurance company has acknowledged coverage) involving an alleged
liability of, or claims against or affecting, Borrower or any of its
Subsidiaries equal to or greater than $1,000,000, and promptly after request by
Administrative
78
Agent such other information as may be reasonably requested by
Administrative Agent to enable Administrative Agent and its counsel to evaluate
any of such Proceedings;
(ix) ERISA Events: promptly upon becoming aware of the
occurrence of or forthcoming occurrence of any ERISA Event, a written
notice specifying the nature thereof, what action Borrower, any of its
Subsidiaries or any of their respective ERISA Affiliates has taken, is
taking or proposes to take with respect thereto and, when known, any
action taken or threatened by the Internal Revenue Service, the
Department of Labor or the PBGC with respect thereto;
(x) ERISA Notices: with reasonable promptness, copies of
all notices received by Borrower, any of its Subsidiaries or any of
their respective ERISA Affiliates from a Multiemployer Plan sponsor
concerning an ERISA Event;
(xi) Business Model: as soon as practicable and in any
event no later than 45 days after the beginning of each Fiscal Year,
Borrower's business model in a form customarily delivered to Borrower's
board of directors;
(xii) Events of Default, etc.: promptly upon, and within
five Business Days after, any executive officer of Borrower obtaining
knowledge (a) of any condition or event that constitutes an Event of
Default or Potential Event of Default, or becoming aware that any
Lender has given any notice (other than to Administrative Agent) or
taken any other action with respect to a claimed Event of Default or
Potential Event of Default, (b) that any Person has given any notice to
Borrower or any of its Subsidiaries or taken any other action with
respect to a claimed default or event or condition of the type referred
to in subsection 8.2, (c) of any resignation or dismissal of Borrower's
independent accountant, (d) of any Change of Control or other event
requiring a prepayment of principal on any Subordinated Indebtedness,
(e) of any individual or series of related Asset Sales, issuances of
Capital Stock or receipt of Net Insurance/Condemnation Proceeds
aggregating in excess of $10,000,000, or (f) of the occurrence of any
event or change that has caused or evidences, either in any case or in
the aggregate, a Material Adverse Effect, an Officer's Certificate
specifying the nature and period of existence of such condition, event
or change, or specifying the notice given or action taken by any such
Person and the nature of such claimed Event of Default, Potential Event
of Default, default, event or condition, and what action Borrower has
taken, is taking and proposes to take with respect thereto;
(xiii) Corporate Matters: with reasonable promptness, written
notice of (1) any amendment of the articles or certificate of
incorporation or by-laws or other constituent documents of Borrower or
any of its Material Subsidiaries and (2) any change in the composition
of the board of directors of Borrower or any of its Material
Subsidiaries; and
(xiv) Other Information: with reasonable promptness, such
other information and data with respect to Borrower or any of its
Subsidiaries as from time to time may be reasonably requested by any
Lender; provided such requests are coordinated through the
Administrative Agent.
79
6.2 EXISTENCE, ETC.
Borrower will, and will cause each of its Subsidiaries to, at
all times preserve and keep in full force and effect its existence and all
rights and franchises material to its business; provided, however that neither
Borrower nor any of its Subsidiaries shall be required to preserve any such
right or franchise if the Governing Body of Borrower or such Subsidiary shall
determine that the preservation thereof is no longer desirable in the conduct of
the business of Borrower or such Subsidiary, as the case may be, and that the
loss thereof is not disadvantageous in any material respect to Borrower, such
Subsidiary or Lenders.
6.3 PAYMENT OF TAXES AND CLAIMS; TAX.
A. Borrower will, and will cause each of its Subsidiaries
to, pay all federal income taxes, all taxes imposed by the state of its
principal place of business and all other material taxes, material
assessments and other governmental charges imposed upon it or any of
its properties or assets or in respect of any of its income, businesses
or franchises before any penalty accrues thereon, and all claims
(including claims for labor, services, materials and supplies) for sums
that have become due and payable and that by law have or may become a
Lien upon any of its properties or assets, prior to the time when any
penalty or fine shall be incurred with respect thereto; provided that
no such charge or claim need be paid if it is being contested in good
faith by appropriate proceedings promptly instituted and diligently
conducted, so long as (i) such reserve or other appropriate provision,
if any, as shall be required in conformity with GAAP shall have been
made therefor and (ii) in the case of a charge or claim which has or
may become a Lien against any of the Collateral, such proceedings
conclusively operate to stay the sale of any portion of the Collateral
to satisfy such charge or claim.
B. Borrower will not, nor will it permit any of its
Subsidiaries to, file or consent to the filing of any consolidated
income tax return with any Person (other than Borrower or any of its
Subsidiaries).
6.4 MAINTENANCE OF PROPERTIES; INSURANCE; APPLICATION OF NET
INSURANCE/CONDEMNATION PROCEEDS.
A. MAINTENANCE OF PROPERTIES. Borrower will, and will
cause each of its Subsidiaries to, maintain or cause to be maintained
in good repair, working order and condition, ordinary wear and tear
excepted, all material properties used or useful in the business of
Borrower and its Subsidiaries (including all Intellectual Property) and
from time to time will make or cause to be made all appropriate
repairs, renewals and replacements thereof.
B. INSURANCE. Borrower will maintain or cause to be
maintained, with financially sound and reputable insurers, such public
liability insurance, third party property damage insurance, business
interruption insurance and casualty insurance with respect to
liabilities, losses or damage in respect of the assets, properties and
businesses of Borrower and its Subsidiaries as may customarily be
carried or maintained under similar circumstances by corporations of
established reputation engaged in similar
80
businesses, in each case in such amounts (giving effect to
self-insurance, to the extent companies of similar size and in similar
businesses self-insure), with such deductibles, covering such risks and
otherwise on such terms and conditions as shall be customary for
corporations similarly situated in the industry. Without limiting the
generality of the foregoing, Borrower will maintain or cause to be
maintained (i) flood insurance with respect to each Flood Hazard
Property that is located in a community that participates in the
National Flood Insurance Program, in each case in compliance with any
applicable regulations of the Board of Governors of the Federal Reserve
System, and (ii) replacement value casualty insurance on the Collateral
under such policies of insurance, with such insurance companies, in
such amounts, with such deductibles, covering such risks, and having
other terms and conditions as are at all times satisfactory to
Administrative Agent in its commercially reasonable judgment. Each such
policy of insurance shall (a) name Administrative Agent for the benefit
of Lenders as an additional insured thereunder as its interests may
appear and (b) in the case of each business interruption and casualty
insurance policy, contain a loss payable clause or endorsement,
satisfactory in form and substance to Administrative Agent, that names
Administrative Agent for the benefit of Lenders as the loss payee
thereunder for any covered loss in excess of $10,000,000 and provides
for at least 30 days prior written notice to Administrative Agent of
any modification or cancellation of such policy.
C. APPLICATION OF NET INSURANCE/CONDEMNATION PROCEEDS.
(i) Net Insurance/Condemnation Proceeds Received by
Borrower. Upon receipt by Borrower or any of its Subsidiaries of any
Net Insurance/Condemnation Proceeds, (a) so long as no Event of Default
or Potential Event of Default shall have occurred and be continuing,
Borrower shall, or shall cause one or more of its Subsidiaries to,
promptly and diligently apply such Net Insurance/Condemnation Proceeds
to pay or reimburse the costs of repairing, restoring or replacing the
assets (or comparable assets) in respect of which such Net
Insurance/Condemnation Proceeds were received, and (b) if an Event of
Default or Potential Event of Default shall have occurred and be
continuing or the Net Insurance/Condemnation Proceeds have not been
used to repair, restore or replace such assets within 365 days and the
Consolidated Total Leverage Ratio exceeds 3.50 to 1.00, Borrower shall
apply an amount equal to such Net Insurance/Condemnation Proceeds to
prepay the Loans (and/or the Revolving Loan Commitments shall be
reduced) if required by subsection 2.4A.
(ii) Net Insurance/Condemnation Proceeds Received by
Administrative Agent. Upon receipt by Administrative Agent of any Net
Insurance/Condemnation Proceeds as loss payee, if and to the extent
Borrower would have been required to apply such Net
Insurance/Condemnation Proceeds (if it had received them directly) to
prepay the Loans and/or reduce the Revolving Loan Commitments,
Administrative Agent shall, and Borrower hereby authorizes
Administrative Agent to, apply such Net Insurance/Condemnation Proceeds
to prepay the Loans (and/or the Revolving Loan Commitments shall be
reduced) as required by subsection 2.4A.
6.5 INSPECTION RIGHTS.
Borrower shall, and shall cause each of its Subsidiaries to,
permit any authorized representatives designated by Administrative Agent to
visit and inspect any of the properties or
81
Facilities of Borrower or of any of its Subsidiaries, to inspect, copy and take
extracts from its and their financial and accounting records, and to discuss its
and their affairs, finances and accounts with its and their officers and
independent public accountants (provided that Borrower may, if it so chooses, be
present at or participate in any such discussion), all upon reasonable notice
and at such reasonable times during normal business hours and as often as may
reasonably be requested.
6.6 COMPLIANCE WITH LAWS, ETC.
Borrower shall comply, and shall cause each of its
Subsidiaries and all other Persons on or occupying any Facilities to comply,
with the requirements of all applicable laws, rules, regulations and orders of
any Government Authority (including all Environmental Laws), noncompliance with
which could reasonably be expected to result in, individually or in the
aggregate, a Material Adverse Effect.
6.7 ENVIRONMENTAL MATTERS.
A. ENVIRONMENTAL DISCLOSURE. Borrower will deliver to
Administrative Agent and Lenders:
(i) Environmental Audits and Reports. As soon as
practicable following receipt thereof, copies of all environmental
audits, investigations, analyses and reports of any kind or character,
whether prepared by personnel of Borrower or any of its Subsidiaries or
by independent consultants, governmental authorities or any other
Persons, with respect to significant environmental matters at any
Facility that, individually or in the aggregate, could reasonably be
expected to result in a Material Adverse Effect or with respect to any
Environmental Claims that, individually or in the aggregate, could
reasonably be expected to result in a Material Adverse Effect;
(ii) Notice of Certain Releases, Remedial Actions, Etc.
Promptly upon the discovery thereof, written notice describing in
reasonable detail (a) any Release required to be reported to any
federal, state or local governmental or regulatory agency under any
applicable Environmental Laws, (b) any remedial action taken by
Borrower or any other Person in response to (1) any Hazardous Materials
Activities the existence of which could reasonably be expected to
result in one or more Environmental Claims having, individually or in
the aggregate, a Material Adverse Effect, or (2) any Environmental
Claims that, individually or in the aggregate, could reasonably be
expected to have a Material Adverse Effect, and (c) Borrower's
discovery of any occurrence or condition on any real property adjoining
or in the vicinity of any Facility that could cause such Facility or
any part thereof to be subject to any material restrictions on the
ownership, occupancy, transferability or use thereof under any
Environmental Laws.
(iii) Written Communications Regarding Environmental Claims,
Releases, Etc. As soon as practicable following the sending or receipt
thereof by Borrower or any of its Subsidiaries, a copy of any and all
written communications with respect to (a) any Environmental Claims
that, individually or in the aggregate, could reasonably be
82
expected to result in a Material Adverse Effect, (b) any Release
required to be reported to any federal, state or local governmental or
regulatory agency, and (c) any request for information from any
governmental agency that suggests such agency is investigating whether
Borrower or any of its Subsidiaries may be potentially responsible for
any Hazardous Materials Activity.
(iv) Notice of Certain Proposed Actions Having
Environmental Impact. Prompt written notice describing in reasonable
detail any proposed acquisition of stock, assets, or property by
Borrower or any of its Subsidiaries that could reasonably be expected
to expose Borrower or any of its Subsidiaries to, or result in,
Environmental Claims that could reasonably be expected to result in,
individually or in the aggregate, a Material Adverse Effect.
B. BORROWER'S ACTIONS REGARDING HAZARDOUS MATERIALS
ACTIVITIES, ENVIRONMENTAL CLAIMS AND VIOLATIONS OF ENVIRONMENTAL LAWS.
(i) Remedial Actions Relating to Hazardous Materials
Activities. Borrower shall, in compliance with all applicable
Environmental Laws, promptly undertake, and shall cause each of its
Subsidiaries promptly to undertake, any and all investigations,
studies, sampling, testing, abatement, cleanup, removal, remediation or
other response actions necessary to remove, remediate, clean up or
xxxxx any Hazardous Materials Activity on, under or about any Facility
that is in violation of any Environmental Laws or that presents a
material risk of giving rise to an Environmental Claim. If Borrower or
any of its Subsidiaries undertakes any such action with respect to any
Hazardous Materials, Borrower or such Subsidiary shall conduct and
complete such action in compliance with all applicable Environmental
Laws and in accordance with the policies, orders and directives of all
federal, state and local governmental authorities except when, and only
to the extent that, Borrower's or such Subsidiary's liability with
respect to such Hazardous Materials Activity is being diligently
contested in good faith and by appropriate proceedings by Borrower or
such Subsidiary.
(ii) Actions with Respect to Environmental Claims and
Violations of Environmental Laws. Borrower shall promptly take, and
shall cause each of its Subsidiaries promptly to take, any and all
actions reasonably necessary to (i) cure any violation of applicable
Environmental Laws by Borrower or its Subsidiaries that could
reasonably be expected to result in, individually or in the aggregate,
a Material Adverse Effect and (ii) make an appropriate response to any
Environmental Claim against Borrower or any of its Subsidiaries and
discharge any obligations it may have to any Person thereunder where
failure to do so could reasonably be expected to result in,
individually or in the aggregate, a Material Adverse Effect.
C. ENVIRONMENTAL INVESTIGATIONS. Company agrees that
Administrative Agent may, from time to time and in its reasonable discretion,
(i) retain, at Borrower's expense, an independent professional consultant to
review any environmental audits, investigations, analyses and reports relating
to Hazardous Materials prepared by or for Borrower and (ii) if (a)
Administrative Agent reasonably believes that Borrower has breached any
representation,
83
warranty or covenant contained in subsection 5.6, 5.13, 6.6 or 6.7 or that there
has been a material violation of Environmental Laws at any Facility or by
Borrower or any of its Subsidiaries at any other location or (b) an Event of
Default has occurred and is continuing, conduct its own investigation of any
Facility; provided that, in the case of any Facility no longer owned, leased,
operated or used by Borrower or any of its Subsidiaries, Borrower shall only be
obligated to use its best efforts to obtain permission for Administrative
Agent's professional consultant to conduct an investigation of such Facility.
For purposes of conducting such a review and/or investigation, Borrower hereby
grants to Administrative Agent and its agents, employees, consultants and
contractors the right to enter into or onto any Facilities currently owned,
leased, operated or used by Borrower or any of its Subsidiaries and to perform
such tests on such property (including taking samples of soil, groundwater and
suspected asbestos-containing materials) as are reasonably necessary in
connection therewith. Any such investigation of any Facility shall be conducted,
unless otherwise agreed to by Borrower and Administrative Agent, during normal
business hours and, to the extent reasonably practicable, shall be conducted so
as not to interfere with the ongoing operations at such Facility or to cause any
damage or loss to any property at such Facility. Borrower and Administrative
Agent hereby acknowledge and agree that any report of any investigation
conducted at the request of Administrative Agent pursuant to this subsection
6.7C will be obtained and shall be used by Administrative Agent and Lenders for
the purposes of Lenders' internal credit decisions, to monitor and police the
Loans and other extensions of credit hereunder and to protect Lenders' security
interests, if any, created by the Loan Documents. Administrative Agent agrees to
deliver a copy of any such report to Borrower and Lenders with the understanding
that Borrower acknowledges and agrees that (x) it will indemnify and hold
harmless Administrative Agent and each Lender from any costs, losses or
liabilities relating to Borrower's use of or reliance on such report, (y)
neither Administrative Agent nor any Lender makes any representation or warranty
with respect to such report, and (z) by delivering such report to Borrower,
neither Administrative Agent nor any Lender is requiring or recommending the
implementation of any suggestions or recommendations contained in such report.
6.8 EXECUTION OF SUBSIDIARY GUARANTY AND PERSONAL PROPERTY
COLLATERAL DOCUMENTS AFTER THE CLOSING DATE.
A. EXECUTION OF SUBSIDIARY GUARANTY AND PERSONAL PROPERTY
COLLATERAL DOCUMENTS. If any Subsidiary of Borrower existing on the Closing Date
that has not previously executed the Subsidiary Guaranty hereafter becomes a
Material Subsidiary, or if any Person becomes a Material Subsidiary after the
date hereof, Borrower will promptly notify Administrative Agent of that fact and
cause such Material Subsidiary to execute and deliver to Administrative Agent a
counterpart of the Subsidiary Guaranty and Pledge Agreement and to take all such
further actions and execute all such further documents and instruments
(including actions, documents and instruments comparable to those described in
subsection 4.1K) as may be necessary or, in the opinion of Administrative Agent,
desirable to create in favor of Administrative Agent, for the benefit of
Lenders, a valid First Priority Lien on all Capital Stock of any Material
Subsidiary owned by such Material Subsidiary.
B. SUBSIDIARY ORGANIZATIONAL DOCUMENTS, LEGAL OPINIONS,
ETC. Borrower shall deliver to Administrative Agent, together with such Loan
Documents, (i) certified copies of
84
such Material Subsidiary's Organizational Documents, together with a good
standing certificate from the Secretary of State of the jurisdiction of its
organization and each other state in which such Person is qualified to do
business and, to the extent generally available, a certificate or other evidence
of good standing as to payment of any applicable franchise or similar taxes from
the appropriate taxing authority of each of such jurisdictions, each to be dated
a recent date prior to their delivery to Administrative Agent, (ii) a
certificate executed by the secretary or similar Officer of such Material
Subsidiary as to (a) the fact that the attached resolutions of the Governing
Body of such Material Subsidiary approving and authorizing the execution,
delivery and performance of such Loan Documents are in full force and effect and
have not been modified or amended and (b) the incumbency and signatures of the
Officers of such Material Subsidiary executing such Loan Documents, and (iii) a
favorable opinion of counsel to such Material Subsidiary, addressed to
Administrative Agent and Lenders, in form and substance reasonably satisfactory
to Administrative Agent and its counsel, as to (a) the due organization and good
standing of such Material Subsidiary, (b) the due authorization, execution and
delivery by such Material Subsidiary of such Loan Documents, (c) the
enforceability of such Loan Documents against such Material Subsidiary and (d)
such other matters (including matters relating to the creation and perfection of
Liens in any Collateral pursuant to such Loan Documents) as Administrative Agent
may reasonably request, all of the foregoing to be satisfactory in form and
substance to Administrative Agent and its counsel.
6.9 REDEMPTION OF 9.25% FIRST MORTGAGE NOTES.
Within forty-five days of the Closing Date (or if such day is
not a Business Day, the next Business Day), the Borrower shall have redeemed the
9.25% First Mortgage Notes, extinguished all commitments in connection therewith
and delivered reasonably satisfactory evidence of thereof to Administrative
Agent.
6.10 QUALIFIED PROPERTIES.
Borrower shall at all times maintain at least twenty (20)
Qualified Properties of which at least fifteen (15) shall not be subject to
Ground Leases.
SECTION 7. BORROWER'S NEGATIVE COVENANTS
Borrower covenants and agrees that, so long as any of the
Commitments hereunder shall remain in effect and until payment in full of all of
the Loans and other Obligations and the cancellation or expiration of all
Letters of Credit, unless Requisite Lenders shall otherwise give prior written
consent, Borrower shall perform, and shall cause each of its Subsidiaries to
perform, all covenants in this Section 7.
7.1 INDEBTEDNESS; CONTINGENT OBLIGATIONS.
Borrower shall not, and shall not permit any of its
Subsidiaries to, directly or indirectly, create, incur, assume or guaranty, or
otherwise become or remain directly or indirectly liable with respect to, any
Indebtedness or any Contingent Obligations, except:
85
(i) Borrower and its Subsidiaries may become and remain
liable with respect to the Obligations;
(ii) Borrower may become and remain liable with respect to
Contingent Obligations under Hedge Agreements with respect to
Indebtedness in an aggregate notional principal amount not to exceed at
any time $125,000,000;
(iii) Borrower and its Subsidiaries, as applicable, may
remain liable with respect to Indebtedness and Contingent Obligations
described in Schedule 7.1 annexed hereto;
(iv) Borrower may become and remain liable with respect to
unsecured Indebtedness to any Subsidiary Guarantor, and any
wholly-owned Subsidiary Guarantor may become and remain liable with
respect to unsecured Indebtedness to Borrower or any Subsidiary
Guarantor; provided that (a) all such intercompany Indebtedness owed by
Borrower to any of its Subsidiaries shall be subordinated in right of
payment to the payment in full of the Obligations, (b) any payment by
any Subsidiary Guarantor under any guaranty of the Obligations shall
result in a pro tanto reduction of the amount of any intercompany
Indebtedness owed by such Subsidiary Guarantor to Borrower or to any of
its Subsidiaries for whose benefit such payment is made;
(v) Until the forty-sixth day (or if such day is not a
Business Day, the next Business Day) following the Closing Date,
Borrower may remain liable with respect to the 9.25% First Mortgage
Notes;
(vi) Borrower and its Subsidiaries, as applicable, may
remain liable with respect to the 8-3/8% Senior Subordinated Notes and
renewals, replacements or refinancings of such 8-3/8% Senior
Subordinated Notes and guaranties if such Indebtedness (a) bears a
market interest rate, (b) has a maturity no earlier than one year after
the Revolving Loan Commitment Termination Date, (c) has a no-call
option that expires no earlier than 120 days after the Revolving Loan
Commitment Termination Date and (d) has other terms and conditions
substantially similar to (or more favorable to Borrower and Lenders
than) the 8-3/8% Senior Subordinated Notes;
(vii) Borrower and Subsidiary Guarantors may become and
remain liable with respect to Contingent Obligations of non-Subsidiary
Guarantors that constitute Indebtedness, Contingent Obligations or
Consolidated Rental Payments;
(viii) Borrower and its Subsidiaries, as applicable, may
remain liable with respect to additional Subordinated Indebtedness in
an aggregate principal amount not to exceed $200,000,000;
(ix) Borrower and its Subsidiaries may become and remain
liable with respect to Contingent Obligations in respect of customary
indemnification and purchase price adjustment obligations incurred in
connection with (w) Asset Sales or other sales of assets or securities,
(x) Investments permitted under this Agreement, (y) financings and
86
(z) other similar transactions and other customary indemnification
obligations entered into in the ordinary course of business;
(x) Borrower and its Subsidiaries may become and remain
liable with respect to other Contingent Obligations; provided that the
maximum aggregate liability, contingent or otherwise, of Borrower and
its Subsidiaries in respect of all such Contingent Obligations shall at
no time exceed $50,000,000; provided, however, Borrower and its
Subsidiaries may exceed $50,000,000 with respect to such other
Contingent Obligations so long as any excess is included in the amounts
described in subsection 7.1(xi); and
(xi) Borrower and its Subsidiaries may become and remain
liable with respect to other Indebtedness and Contingent Obligations in
an aggregate principal amount not to exceed $100,000,000 at any time
outstanding; provided, that the Consolidated EBITDA of all properties
pledged to secure such other Indebtedness or Contingent Obligations
does not exceed 20% of Consolidated EBITDA.
7.2 LIENS AND RELATED MATTERS.
A. PROHIBITION ON LIENS. Borrower shall not, and shall
not permit any of its Subsidiaries to, directly or indirectly, create, incur,
assume or permit to exist any Lien on or with respect to any property or asset
of any kind (including any document or instrument in respect of goods or
accounts receivable) of Borrower or any of its Subsidiaries, whether now owned
or hereafter acquired, or any income or profits therefrom or proceeds thereof,
or file or permit the filing of, or permit to remain in effect, any financing
statement or other similar notice of any Lien with respect to any such property,
asset, income or profits or proceeds under the UCC of any State or under any
similar recording or notice statute, except:
(i) Permitted Encumbrances;
(ii) Liens granted pursuant to the Collateral Documents;
(iii) Liens existing on the Closing Date and set forth on
Schedule 7.2A; provided that no such Lien shall at any time be extended
to cover property or assets other than the property or assets subject
thereto on the Closing Date and; and
(iv) Other Liens securing Indebtedness permitted under
subsection 7.1.
B. EQUITABLE LIEN IN FAVOR OF LENDERS. If Borrower or any
of its Subsidiaries shall create or assume any Lien upon any of its properties
or assets, whether now owned or hereafter acquired, other than Liens excepted by
the provisions of subsection 7.2A, it shall make or cause to be made effective
provision whereby the Obligations will be secured by such Lien equally and
ratably with any and all other Indebtedness secured thereby as long as any such
Indebtedness shall be so secured which provision shall not cure any default that
may have occurred and which provision shall be made without prejudice to any
rights of Administrative Agent or Lenders with respect to such default; provided
that, notwithstanding the foregoing, this
87
covenant shall not be construed as a consent by Requisite Lenders to the
creation or assumption of any such Lien not permitted by the provisions of
subsection 7.2A.
C. NO FURTHER NEGATIVE PLEDGES. Neither Borrower nor any of its
Subsidiaries shall enter into any agreement prohibiting the creation or
assumption of any Lien upon any of its properties or assets, whether now owned
or hereafter acquired, except with respect to specific property encumbered to
secure payment of particular Indebtedness or Subordinated Indebtedness or to be
sold pursuant to an executed agreement with respect to an Asset Sale permitted
by this Agreement.
D. NO RESTRICTIONS ON SUBSIDIARY DISTRIBUTIONS TO BORROWER OR
OTHER SUBSIDIARIES. Borrower will not, and will not permit any of its
Subsidiaries to, create or otherwise cause or suffer to exist or become
effective any consensual encumbrance or restriction of any kind on the ability
of any such Subsidiary to (i) pay dividends or make any other distributions on
any of such Subsidiary's Capital Stock owned by Borrower or any other Subsidiary
of Borrower, (ii) repay or prepay any Indebtedness owed by such Subsidiary to
Borrower or any other Subsidiary of Borrower, (iii) make loans or advances to
Borrower or any other Subsidiary of Borrower, or (iv) transfer any of its
property or assets to Borrower or any other Subsidiary of Borrower, except for
such encumbrances or restrictions existing under or by reasons of:
(i) existing Indebtedness in existence on the Closing
Date, as in effect on the Closing Date;
(ii) the Subordinated Indebtedness;
(iii) applicable law;
(iv) any instrument governing Indebtedness or Capital Stock
of a Person acquired by the Borrower or any of its Subsidiaries or any
Person that becomes a Subsidiary as in effect at the time of such
acquisition or such Person becoming a Subsidiary (except to the extent
such Indebtedness was incurred in connection with or, if incurred
within one year prior to such acquisition or such Person becoming a
Subsidiary, in contemplation of such acquisition or such Person
becoming a Subsidiary), which encumbrance or restriction is not
applicable to any Person, or the properties or assets of any Person,
other than the Person, or the property or assets of the Person, so
acquired;
(v) any instrument governing Indebtedness or Capital Stock
of a Person who becomes a Subsidiary Guarantor as in effect at the time
of becoming a Subsidiary Guarantor (except to the extent such
Indebtedness was incurred in connection with or, if incurred within one
year prior to the time of becoming a Subsidiary Guarantor, in
contemplation of such Subsidiary Guaranty), which encumbrance or
restriction is not applicable to any Person, or the properties or
assets of any Person, other than the Person, or the property or assets
of the Person who became a Subsidiary Guarantor;
88
(vi) by reason of customary non-assignment and net worth
provisions in leases entered into in the ordinary course of business
and consistent with past practices;
(vii) purchase money obligations for property acquired in
the ordinary course of business that impose restrictions of the nature
described in clause (iv) above on the property so acquired;
(viii) customary restrictions in security agreements or
mortgages securing Indebtedness of a Subsidiary to the extent such
restrictions restrict the transfer of the property subject to the
security agreements and mortgages; or
(ix) minimum net worth or other provisions contained in
leases entered into by Subsidiaries of the Borrower permitted by this
Agreement which restrictions are not applicable to any Person, or the
properties or assets of any Person, other than such Subsidiary.
7.3 INVESTMENTS; ACQUISITIONS; AND RESTRICTED JUNIOR PAYMENTS.
Borrower shall not, and shall not permit any of its
Subsidiaries to, directly or indirectly, make or own any Investment in any
Person, including any Joint Venture, or acquire, by purchase or otherwise, all
or substantially all the business, property or fixed assets of, or Capital Stock
or other ownership interest of any Person, or any division or line of business
of any Person or to directly or indirectly, declare, order, pay, make or set
apart any sum for any Restricted Junior Payment except:
(i) Borrower and its Subsidiaries may make and own
Investments in Cash Equivalents;
(ii) Borrower and its Subsidiaries may continue to own the
Investments owned by them as of the Closing Date in any Subsidiaries of
Borrower and Borrower and its wholly-owned Subsidiaries may make and
own additional equity Investments in their respective wholly-owned
Subsidiaries;
(iii) Borrower and its Subsidiaries may make intercompany
loans to the extent permitted under subsection 7.1(iv);
(iv) Borrower and its Subsidiaries may make Consolidated
Capital Expenditures permitted by subsection 7.6;
(v) Borrower and its Subsidiaries may continue to own the
Investments owned by them and described in Schedule 7.3 annexed
hereto;
(vi) Borrower may make regularly scheduled payments of
interest in respect of any Subordinated Indebtedness in accordance with
the terms of, and only to the extent required by, and subject to the
subordination provisions contained in, the indenture or other agreement
pursuant to which such Subordinated Indebtedness was issued, as such
89
indenture or other agreement may be amended from time to time to the
extent permitted under subsection 7.10B; and
(vii) Borrower and its Subsidiaries may make Investments and
Restricted Junior Payments in an aggregate amount not in excess of the
sum of $50,000,000 and the Carryover Amount in any Fiscal Year;
provided that the amount of Restricted Junior Payments in any Fiscal
Year does not exceed $25,000,000. For purposes of this Agreement,
"CARRYOVER AMOUNT" for any Fiscal Year means 50% of the difference
between (a) $50,000,000 plus the Carryover Amount for the prior Fiscal
Year and (b) the amount of Investments and Restricted Junior Payments
made by Borrower and its Subsidiaries pursuant to this subsection
7.3(vii) during such prior Fiscal Year; provided that the Carryover
Amount for Fiscal Year 2002 shall be 0; and provided further that the
Carryover Amount for any Fiscal Year shall not exceed $25,000,000.
7.4 FINANCIAL COVENANTS.
A. MINIMUM INTEREST COVERAGE RATIO. Borrower shall not
permit the ratio of (i) Consolidated EBITDA to (ii) Consolidated Interest
Expense for any four-consecutive Fiscal Quarter period ending during any of the
periods set forth below to be less than the correlative ratio indicated:
minimum interest
period coverage ratio
------ --------------
2nd Fiscal Quarter, Fiscal Year 2002 through 2nd 2.35:1.00
Fiscal Quarter, Fiscal Year 2003
3rd Fiscal Quarter, Fiscal Year 2003 2.50:1.00
through 2nd Fiscal Quarter, Fiscal Year 2005
3rd Fiscal Quarter, Fiscal Year 2005 and 2.75:1.00
thereafter
90
B. MAXIMUM CONSOLIDATED TOTAL LEVERAGE RATIO. Borrower
shall not permit the Consolidated Total Leverage Ratio as of the last day of the
most recently ended Fiscal Quarter ending during any of the periods set forth
below to exceed the correlative ratio indicated:
PERIOD MAXIMUM CONSOLIDATED TOTAL
------ --------------------------
LEVERAGE RATIO
--------------
2nd Fiscal Quarter, Fiscal Year 2002 4.50:1.00
through 2nd Fiscal Quarter, Fiscal Year 2003
3rd Fiscal Quarter, Fiscal Year 2003 4.25:1.00
through 2nd Fiscal Quarter, Fiscal Year 2004
3rd Fiscal Quarter, Fiscal Year 2004 4.00:1.00
through 2nd Fiscal Quarter, Fiscal Year 2005
3rd Fiscal Quarter, Fiscal Year 2005 3.75:1.00
and thereafter.
C. MAXIMUM CONSOLIDATED SENIOR LEVERAGE RATIO. Borrower shall not
permit the Consolidated Senior Leverage Ratio as of the last day of any Fiscal
Quarter ending during any of the periods set forth below to exceed the
correlative ratio indicated:
period maximum consolidated senior
------ ---------------------------
leverage ratio
--------------
2nd Fiscal Quarter, Fiscal Year 2002 2.50:1.00
through 2nd Fiscal Quarter, Fiscal Year 2003
3rd Fiscal Quarter, Fiscal Year 2003 2.40:1.00
through 2nd Fiscal Quarter, Fiscal Year 2004
3rd Fiscal Quarter, Fiscal Year 2004 2.30:1.00
through 2nd Fiscal Quarter, Fiscal Year 2005
3rd Fiscal Quarter, Fiscal Year 2005 2.20:1.00
91
and thereafter.
D. MINIMUM CONSOLIDATED NET WORTH. Borrower shall not permit
Consolidated Net Worth at any time to be less than $600,000,000 plus 50% of
positive Consolidated Net Income during each Fiscal Quarter since the Closing
Date; provided, however, that if the Consolidated Net Income for any Fiscal Year
to date is positive (notwithstanding negative Consolidated Net Income for any
particular Fiscal Quarter during such Fiscal Year), then 50% of Consolidated Net
Income for that Fiscal Year calculated as a single period shall be used in lieu
of 50% of positive Consolidated Net Income for each Fiscal Quarter of that
Fiscal Year.
7.5 RESTRICTION ON FUNDAMENTAL CHANGES.
Borrower shall not, and shall not permit any of its
Subsidiaries to, alter the corporate, capital or legal structure of Borrower or
any of its Subsidiaries, or enter into any transaction of merger or
consolidation, or liquidate, wind-up or dissolve itself (or suffer any
liquidation or dissolution), or acquire by purchase or otherwise all or
substantially all the business, property or fixed assets of, or stock or other
evidence of beneficial ownership of, any Person or any division or line of
business of any Person (other than purchases or other acquisitions of Inventory,
materials and equipment in the ordinary course of Borrower's, or any of its
Subsidiaries', business) except:
(i) any Subsidiary of Borrower may be merged with or into
Borrower or any wholly-owned Subsidiary Guarantor, or be liquidated,
wound up or dissolved, or all or any part of its business, property or
assets may be conveyed, sold, leased, transferred or otherwise disposed
of, in one transaction or a series of transactions, to Borrower or any
wholly-owned Subsidiary Guarantor; provided that, (i) in the case of
such a merger, Borrower or such wholly-owned Subsidiary Guarantor shall
be the continuing or surviving Person and (ii) in the case of such a
liquidation, winding up or dissolution, all of the assets of such
wholly-owned Subsidiary Guarantor are transferred to Borrower or a
Subsidiary Guarantor that is wholly owned, directly or indirectly, by
Borrower or as otherwise expressly permitted under this Agreement; and
(ii) Any Person may be merged with or into Borrower or any
of its Subsidiaries if the acquisition of the Capital Stock of such
Person by Borrower or such Subsidiary would have been permitted
pursuant to subsections 7.3 and 7.6; provided that (a) in the case of
Borrower, Borrower shall be the continuing or surviving Person, (b) if
a Subsidiary of Borrower is not the surviving or continuing Person, the
surviving Person becomes a Subsidiary of Borrower and complies with the
provisions of subsection 6.8 and (c) no Potential Event of Default or
Event of Default shall have occurred or be continuing after giving
effect thereto.
92
7.6 CONSOLIDATED CAPITAL EXPENDITURES.
Borrower shall not, and shall not permit its Subsidiaries to,
make or incur Consolidated Capital Expenditures unless such expenditures are for
the expansion, development, improvement, renovation, acquisition or construction
of hotel properties and businesses Borrower and its Subsidiaries are permitted
to enter into under subsection 7.9.
7.7 TRANSACTIONS WITH SHAREHOLDERS AND AFFILIATES.
Borrower shall not, and shall not permit any of its
Subsidiaries to, directly or indirectly, enter into or permit to exist any
transaction (including the purchase, sale, lease or exchange of any property or
the rendering of any service) with any holder of 15% or more of any class of
equity Securities of Borrower or with any Affiliate of Borrower or of any such
holder, on terms that are less favorable to Borrower or that Subsidiary, as the
case may be, than those that might be obtained at the time from Persons who are
not such a holder or Affiliate; provided that the foregoing restriction shall
not apply to (i) any transaction between Borrower and any of its wholly-owned
Domestic Subsidiaries that are Subsidiary Guarantors or between any of its
wholly-owned Domestic Subsidiaries that are Subsidiary Guarantors or (ii)
reasonable and customary fees paid to members of the Governing Bodies of
Borrower and its Subsidiaries.
7.8 SALES AND LEASE-BACKS
Borrower shall not, and shall not permit any of its
Subsidiaries to, directly or indirectly, become or remain liable as lessee or as
a guarantor or other surety with respect to any lease, whether an Operating
Lease or a Capital Lease, of any property (whether real, personal or mixed),
whether now owned or hereafter acquired, (i) that Borrower or any of its
Subsidiaries has sold or transferred or is to sell or transfer to any other
Person (other than Borrower or any of its Subsidiaries) or (ii) that Borrower or
any of its Subsidiaries intends to use for substantially the same purpose as any
other property that has been or is to be sold or transferred by Borrower or any
of its Subsidiaries to any Person (other than Borrower or any of its
Subsidiaries) in connection with such lease, unless the Net Asset Sale Proceeds
from all such sales do not exceed $200,000,000 in the aggregate; and to the
extent that Borrower and its Subsidiaries become and remain liable as lessee,
guarantor or other surety with respect to any such lease, and to the extent that
such lease obligations are non-recourse to the assets of Borrower or its
Subsidiaries against Borrower or its Subsidiaries (other than the leasehold
estate and the assets of any special purpose entity established to incur such
lease obligations).
7.9 CONDUCT OF BUSINESS.
From and after the Closing Date, Borrower shall not, and shall
not permit any of its Subsidiaries to, engage in any business other than (i) the
businesses engaged in by Borrower and its Subsidiaries on the Closing Date and
similar, related or other hospitality businesses and (ii) such other lines of
business as may be consented to by Requisite Lenders.
93
7.10 AMENDMENTS OR WAIVERS OF CERTAIN AGREEMENTS; AMENDMENTS OF
DOCUMENTS RELATING TO SUBORDINATED INDEBTEDNESS.
A. AMENDMENTS OR WAIVERS OF CERTAIN AGREEMENTS. Neither
Borrower nor any of its Subsidiaries will agree to any material amendment to, or
waive any of its material rights under, any agreement evidencing or governing
the 9.25% First Mortgage Notes after the Closing Date (other than through
defeasance) without in each case obtaining the prior written consent of
Requisite Lenders to such amendment or waiver.
B. AMENDMENTS OF DOCUMENTS RELATING TO SUBORDINATED
INDEBTEDNESS. Borrower shall not, and shall not permit any of its Subsidiaries
to, amend or otherwise change the terms of any Subordinated Indebtedness, or
make any payment consistent with an amendment thereof or change thereto, if the
effect of such amendment or change is to increase the interest rate on such
Subordinated Indebtedness, change (to earlier dates) any dates upon which
payments of principal or interest are due thereon, change any event of default
or condition to an event of default with respect thereto in a manner adverse to
Borrower (other than to eliminate any such event of default or increase any
grace period related thereto), change the redemption, prepayment or defeasance
provisions thereof, change the subordination provisions thereof (or of any
guaranty thereof), or change any collateral therefor (other than to release such
collateral), or if the effect of such amendment or change, together with all
other amendments or changes made, is to increase materially the obligations of
the obligor thereunder or to confer any additional rights on the holders of such
Subordinated Indebtedness (or a trustee or other representative on their behalf)
that would be materially adverse to Borrower or adverse to Lenders.
7.11 RESTRICTION ON LEASES.
Borrower shall not, and shall not permit any of its
Subsidiaries to, become liable in any way, whether directly or by assignment or
as a guarantor or other surety, for the obligations of the lessee under any
lease (other than the intercompany leases between Borrower and its wholly owned
Subsidiaries, the Excluded Leases listed on Schedule 7.11 annexed hereto and the
leases permitted under subsection 7.8), unless, immediately after giving effect
to the incurrence of liability with respect to such lease, the Consolidated
Rental Payments at the time in effect during the then current Fiscal Year do not
exceed $7,500,000 in the aggregate.
7.12 FISCAL YEAR.
Borrower shall not change its Fiscal Year-end from December
31.
7.13 PUBLIC COMPANY.
Borrower shall (i) not cease to have its Common Stock listed
on the New York Stock Exchange or the Nasdaq Stock Exchange and (ii) file on a
timely basis (taking into account all permitted extensions) all quarterly and
annual reports required to be filed by the Borrower with the New York Stock
Exchange, or the Nasdaq Stock Exchange, as the case may be, and the Securities
and Exchange Commission.
94
SECTION 8. EVENTS OF DEFAULT
If any of the following conditions or events ("EVENTS OF
DEFAULT") shall occur:
8.1 FAILURE TO MAKE PAYMENTS WHEN DUE.
Failure by Borrower to pay any installment of principal of any
Loan when due, whether at stated maturity, by acceleration, by notice of
voluntary prepayment, by mandatory prepayment or otherwise; failure by Borrower
to pay when due any amount payable to an Issuing Lender in reimbursement of any
drawing under a Letter of Credit; or failure by Borrower to pay any interest on
any Loan or any fee or any other amount due under this Agreement within three
Business Days after the date due; or
8.2 DEFAULT IN OTHER AGREEMENTS.
(i) Failure of Borrower or any of its Subsidiaries to pay
when due any principal of or interest on or any other amount payable in
respect of one or more items of Indebtedness (other than Indebtedness
referred to in subsection 8.1) or Contingent Obligations in an
individual principal amount of $10,000,000 or more or with an aggregate
principal amount of $15,000,000 or more, in each case beyond the end of
any grace period provided therefor (not to exceed 30 days); or
(ii) breach or default by Borrower or any of its
Subsidiaries with respect to any other material term of (a) one or more
items of Indebtedness or Contingent Obligations in the individual or
aggregate principal amounts referred to in clause (i) above or (b) any
loan agreement, mortgage, indenture or other agreement relating to such
item(s) of Indebtedness or Contingent Obligation(s), if the effect of
such breach or default is to cause, or to permit the holder or holders
of that Indebtedness or Contingent Obligation(s) (or a trustee on
behalf of such holder or holders) to cause, that Indebtedness or
Contingent Obligation(s) to become or be declared due and payable prior
to its stated maturity or the stated maturity of any underlying
obligation, as the case may be (upon the giving or receiving of notice,
lapse of time, both, or otherwise); or
8.3 BREACH OF CERTAIN COVENANTS.
Failure of Borrower to perform or comply with any term or
condition contained in subsection 2.5, 6.2, 6.4 or 6.10, or Section 7; or
8.4 BREACH OF WARRANTY.
Any representation, warranty, certification or other statement
made or deemed made pursuant to Section 2 by Borrower or any of its Subsidiaries
in any Loan Document or in any statement or certificate at any time given by
Borrower or any of its Subsidiaries in writing pursuant hereto or thereto or in
connection herewith or therewith shall be false in any material respect on the
date as of which made or deemed made pursuant to Section 2; or
95
8.5 OTHER DEFAULTS UNDER LOAN DOCUMENTS.
Any Loan Party shall default in the performance of or
compliance with any term contained in this Agreement or any of the other Loan
Documents, other than any such term referred to in any other subsection of this
Section 8, and such default shall not have been remedied or waived within 30
days after the earlier of (i) an Officer of Borrower or such Loan Party becoming
aware of such default or (ii) receipt by Borrower and such Loan Party of notice
from Administrative Agent or any Lender of such default; or
8.6 INVOLUNTARY BANKRUPTCY; APPOINTMENT OF RECEIVER, ETC.
(i) A court having jurisdiction in the premises shall
enter a decree or order for relief in respect of Borrower or any of its
Material Subsidiaries in an involuntary case under the Bankruptcy Code
or under any other applicable bankruptcy, insolvency or similar law now
or hereafter in effect, which decree or order is not stayed; or any
other similar relief shall be granted under any applicable federal or
state law; or
(ii) an involuntary case shall be commenced against
Borrower or any of its Material Subsidiaries under the Bankruptcy Code
or under any other applicable bankruptcy, insolvency or similar law now
or hereafter in effect; or a decree or order of a court having
jurisdiction in the premises for the appointment of a receiver,
liquidator, sequestrator, trustee, custodian or other officer having
similar powers over Borrower or any of its Material Subsidiaries, or
over all or a substantial part of its property, shall have been
entered; or there shall have occurred the involuntary appointment of an
interim receiver, trustee or other custodian of Borrower or any of its
Material Subsidiaries for all or a substantial part of its property; or
a warrant of attachment, execution or similar process shall have been
issued against any substantial part of the property of Borrower or any
of its Material Subsidiaries, and any such event described in this
clause (ii) shall continue for 60 days unless dismissed, bonded or
discharged; or
8.7 VOLUNTARY BANKRUPTCY; APPOINTMENT OF RECEIVER, ETC.
(i) Borrower or any of its Material Subsidiaries shall
have an order for relief entered with respect to it or commence a
voluntary case under the Bankruptcy Code or under any other applicable
bankruptcy, insolvency or similar law now or hereafter in effect, or
shall consent to the entry of an order for relief in an involuntary
case, or to the conversion of an involuntary case to a voluntary case,
under any such law, or shall consent to the appointment of or taking
possession by a receiver, trustee or other custodian for all or a
substantial part of its property; or Borrower or any of its Material
Subsidiaries shall make any assignment for the benefit of creditors; or
(ii) Borrower or any of its Material Subsidiaries shall be
unable, or shall fail generally, or shall admit in writing its
inability, to pay its debts as such debts become due; or the Governing
Body of Borrower or any of its Material Subsidiaries (or any committee
thereof) shall adopt any resolution or otherwise authorize any action
to approve any of the actions referred to in clause (i) above or this
clause (ii); or
96
8.8 JUDGMENTS AND ATTACHMENTS.
Any money judgment, writ or warrant of attachment or similar
process involving (i) in any individual case an amount in excess of $10,000,000
or (ii) in the aggregate at any time an amount in excess of $15,000,000 (in
either case not adequately covered by insurance as to which a solvent and
unaffiliated insurance company has acknowledged coverage) shall be entered or
filed against Borrower or any of its Subsidiaries or any of their respective
assets and shall remain undischarged, unvacated, unbonded or unstayed for a
period of 60 days (or in any event later than five days prior to the date of any
proposed sale thereunder); or
8.9 DISSOLUTION.
Any order, judgment or decree shall be entered against
Borrower or any of its Material Subsidiaries decreeing the dissolution or split
up of Borrower or that Subsidiary and such order shall remain undischarged or
unstayed for a period in excess of 30 days; or
8.10 EMPLOYEE BENEFIT PLANS.
There shall occur one or more ERISA Events which individually
or in the aggregate results in or might reasonably be expected to result in
liability of Borrower, any of its Subsidiaries or any of their respective ERISA
Affiliates in excess of $10,000,000 during the term of this Agreement; or there
shall exist an amount of unfunded benefit liabilities (as defined in Section
4001(a)(18) of ERISA), individually or in the aggregate for all Pension Plans
(excluding for purposes of such computation any Pension Plans with respect to
which assets exceed benefit liabilities), which exceeds $10,000,000; or
8.11 CHANGE OF CONTROL.
A Change of Control shall have occurred; or
8.12 INVALIDITY OF SUBSIDIARY GUARANTY; FAILURE OF SECURITY;
REPUDIATION OF OBLIGATIONS.
At any time after the execution and delivery thereof, (i) the
Subsidiary Guaranty for any reason, other than the satisfaction in full of all
Obligations, shall cease to be in full force and effect (other than in
accordance with its terms) or shall be declared to be null and void, (ii) any
Collateral Document shall cease to be in full force and effect (other than by
reason of a release of Collateral thereunder in accordance with the terms hereof
or thereof, the satisfaction in full of the Obligations or any other termination
of such Collateral Document in accordance with the terms hereof or thereof) or
shall be declared null and void, or Administrative Agent shall not have or shall
cease to have for the benefit of Lenders a valid First Priority Lien in any
Collateral purported to be covered thereby, or (iii) any Loan Party shall
contest the validity or enforceability of any Loan Document in writing or deny
in writing that it has any further liability, including with respect to future
advances by Lenders, under any Loan Document to which it is a party; or
97
8.13 UNINSURED DAMAGE.
Any uninsured damage to or losses, theft or destruction of any of the
assets of Borrower or any of its Material Subsidiaries occurs in excess of
$20,000,000 in the aggregate; or
8.14 LOSS OF MATERIAL LICENSE.
There shall be a material default under any Material License;
(ii) a notice of termination shall have been issued under any Material License;
or (iii) a cure notice issued under any Material License shall remain uncured
beyond the expiration of the time period available to Borrower or any other Loan
Party, as applicable, pursuant to such Material License and/or such cure notice
(as the case may be), to cure the noticed default; or
8.15 SUBORDINATED INDEBTEDNESS.
(a) There shall occur any default under any Subordinated
Indebtedness, or there shall occur any event that requires Borrower or any of
its Subsidiaries to purchase, redeem or otherwise acquire or offer to purchase,
redeem or otherwise acquire all or any portion of any Subordinated Indebtedness;
(b) Borrower or any of its Subsidiaries shall for any reason purchase, redeem or
otherwise acquire or offer to purchase, redeem or otherwise acquire, or make any
other payments in respect of, all or any portion of any Subordinated
Indebtedness, except to the extent expressly permitted by subsection 7.5 or (c)
the trustee in respect of or the requisite holders of the notes evidencing the
Subordinated Indebtedness shall contest the validity or enforceability of any
subordination provisions contained within the agreements related to any
Subordinated Indebtedness;
THEN (i) upon the occurrence of any Event of Default described in subsection
8.6, 8.7 or 8.15(b), each of (a) the unpaid principal amount of and accrued
interest on the Loans, (b) an amount equal to the maximum amount that may at any
time be drawn under all Letters of Credit then outstanding (whether or not any
beneficiary under any such Letter of Credit shall have presented, or shall be
entitled at such time to present, the drafts or other documents or certificates
required to draw under such Letter of Credit), and (c) all other Obligations
shall automatically become immediately due and payable, without presentment,
demand, protest or other requirements of any kind, all of which are hereby
expressly waived by Borrower, and the obligation of each Lender to make any
Loan, and the right of any Lender to issue any Letter of Credit hereunder shall
thereupon terminate, and (ii) upon the occurrence and during the continuation of
any other Event of Default, Administrative Agent shall, upon the written request
or with the written consent of Requisite Lenders, by written notice to Borrower,
declare all or any portion of the amounts described in clauses (a) through (c)
above to be, and the same shall forthwith become, immediately due and payable,
and the obligation of each Lender to make any Loan, and the right of any Lender
to issue any Letter of Credit hereunder shall thereupon terminate; provided that
the foregoing shall not affect in any way the obligations of Lenders under
subsection 3.3C(i).
Notwithstanding anything contained in the preceding paragraph,
if at any time within 60 days after an acceleration of the Loans pursuant to
clause (ii) of such paragraph
98
Borrower shall pay all arrears of interest and all payments on account of
principal which shall have become due otherwise than as a result of such
acceleration (with interest on principal and, to the extent permitted by law,
on overdue interest, at the rates specified in this Agreement) and all Events
of Default and Potential Events of Default (other than non-payment of the
principal of and accrued interest on the Loans, in each case which is due and
payable solely by virtue of acceleration) shall be remedied or waived pursuant
to subsection 10.6, then Requisite Lenders, by written notice to Borrower, may
at their option rescind and annul such acceleration and its consequences; but
such action shall not affect any subsequent Event of Default or Potential Event
of Default or impair any right consequent thereon. The provisions of this
paragraph are intended merely to bind Lenders to a decision which may be made
at the election of Requisite Lenders and are not intended, directly or
indirectly, to benefit Borrower, and such provisions shall not at any time be
construed so as to grant Borrower the right to require Lenders to rescind or
annul any acceleration hereunder or to preclude Administrative Agent or Lenders
from exercising any of the rights or remedies available to them under any of
the Loan Documents, even if the conditions set forth in this paragraph are met.
SECTION 9. ADMINISTRATIVE AGENT
9.1 APPOINTMENT.
A. APPOINTMENT OF ADMINISTRATIVE AGENT. CIBC is hereby
appointed Administrative Agent hereunder and under the other Loan Documents and
each Lender hereby authorizes Administrative Agent to act as its administrative
agent in accordance with the terms of this Agreement and the other Loan
Documents. Administrative Agent agrees to act upon the express conditions
contained in this Agreement and the other Loan Documents, as applicable. The
provisions of this Section 9 are solely for the benefit of Administrative Agent
and Lenders and no Loan Party shall have any rights as a third party beneficiary
of any of the provisions thereof. In performing its functions and duties under
this Agreement, Administrative Agent shall act solely as an Administrative Agent
of Lenders and does not assume and shall not be deemed to have assumed any
obligation towards or relationship of agency or trust with or for Borrower or
any of its Subsidiaries.
B. APPOINTMENT OF SUPPLEMENTAL COLLATERAL AGENTS. It is the
purpose of this Agreement and the other Loan Documents that there shall be no
violation of any law of any jurisdiction denying or restricting the right of
banking corporations or associations to transact business as agent or trustee in
such jurisdiction. It is recognized that in case of litigation under this
Agreement or any of the other Loan Documents, and in particular in case of the
enforcement of any of the Loan Documents, or in case Administrative Agent in
good faith reasonably deems that by reason of any present or future law of any
jurisdiction it may not exercise any of the rights, powers or remedies granted
herein or in any of the other Loan Documents or take any other action which may
be desirable or necessary in connection therewith, it may be necessary that
Administrative Agent appoint an additional individual or institution as a
separate trustee, co-trustee, collateral agent or collateral co-administrative
agent that Administrative Agent in good faith reasonably believes is competent
to so act (any such additional individual or institution being referred to
herein individually as a "SUPPLEMENTAL COLLATERAL AGENT" and collectively as
"SUPPLEMENTAL COLLATERAL AGENTS").
99
If Administrative Agent appoints a Supplemental Collateral
Agent with respect to any Collateral, (i) each and every right, power, privilege
or duty expressed or intended by this Agreement or any of the other Loan
Documents to be exercised by or vested in or conveyed to Administrative Agent
with respect to such Collateral shall be exercisable by and vest in such
Supplemental Collateral Agent to the extent, and only to the extent, necessary
to enable such Supplemental Collateral Agent to exercise such rights, powers and
privileges with respect to such Collateral and to perform such duties with
respect to such Collateral, and every covenant and obligation contained in the
Loan Documents and necessary to the exercise or performance thereof by such
Supplemental Collateral Agent shall run to and be enforceable by either
Administrative Agent or such Supplemental Collateral Agent, and (ii) the
provisions of this Section 9 and of subsections 10.2 and 10.3 that refer to
Administrative Agent shall inure to the benefit of such Supplemental Collateral
Agent subject to and in accordance with such provisions, and all references
therein to Administrative Agent shall be deemed to be references to
Administrative Agent and/or such Supplemental Collateral Agent, as the context
may require.
Should any instrument in writing from Borrower or any other
Loan Party be required by any Supplemental Collateral Agent so appointed by
Administrative Agent for more fully and certainly vesting in and confirming to
him or it such rights, powers, privileges and duties, Borrower shall, or shall
cause such other Loan Party to, execute, acknowledge and deliver any and all
such instruments promptly upon request by Administrative Agent. In case any
Supplemental Collateral Agent, or a successor thereto, shall die, become
incapable of acting, resign or be removed, all the rights, powers, privileges
and duties of such Supplemental Collateral Agent, to the extent permitted by
law, shall vest in and be exercised by Administrative Agent until the
appointment of a new Supplemental Collateral Agent.
9.2 POWERS AND DUTIES; GENERAL IMMUNITY.
X. XXXXXX; DUTIES SPECIFIED. Each Lender irrevocably
authorizes Administrative Agent to take such action on such Lender's behalf and
to exercise such powers, rights and remedies hereunder and under the other Loan
Documents as are specifically delegated or granted to Administrative Agent by
the terms hereof and thereof, together with such powers, rights and remedies as
are reasonably incidental thereto. Administrative Agent shall have only those
duties and responsibilities that are expressly specified in this Agreement and
the other Loan Documents. Administrative Agent may exercise such powers, rights
and remedies and perform such duties by or through its agents or employees.
Administrative Agent shall not have, by reason of this Agreement or any of the
other Loan Documents, a fiduciary relationship in respect of any Lender; and
nothing in this Agreement or any of the other Loan Documents, expressed or
implied, is intended to or shall be so construed as to impose upon
Administrative Agent any obligations in respect of this Agreement or any of the
other Loan Documents except as expressly set forth herein or therein.
B. NO RESPONSIBILITY FOR CERTAIN MATTERS. Administrative Agent
shall not be responsible to any Lender for the execution, effectiveness,
genuineness, validity, enforceability, collectibility or sufficiency of this
Agreement or any other Loan Document or for any representations, warranties,
recitals or statements made herein or therein or made in any written or oral
statements or in any financial or other statements, instruments, reports or
100
certificates or any other documents furnished or made by Administrative Agent to
Lenders or by or on behalf of Borrower to Administrative Agent or any Lender in
connection with the Loan Documents and the transactions contemplated thereby or
for the financial condition or business affairs of Borrower or any other Person
liable for the payment of any Obligations, nor shall Administrative Agent be
required to ascertain or inquire as to the performance or observance of any of
the terms, conditions, provisions, covenants or agreements contained in any of
the Loan Documents or as to the use of the proceeds of the Loans or the use of
the Letters of Credit or as to the existence or possible existence of any Event
of Default or Potential Event of Default. Anything contained in this Agreement
to the contrary notwithstanding, Administrative Agent shall not have any
liability arising from confirmations of the amount of outstanding Loans or the
Letter of Credit Usage or the component amounts thereof, unless any such
liability results from the gross negligence or willful misconduct of
Administrative Agent, as finally determined by a court of competent jurisdiction
..
C. EXCULPATORY PROVISIONS. Neither Administrative Agent nor
any of its officers, directors, employees or agents shall be liable to Lenders
for any action taken or omitted by Administrative Agent under or in connection
with any of the Loan Documents except to the extent caused by Administrative
Agent's gross negligence or willful misconduct. Administrative Agent shall be
entitled to refrain from any act or the taking of any action (including the
failure to take an action) in connection with this Agreement or any of the other
Loan Documents or from the exercise of any power, discretion or authority vested
in it hereunder or thereunder unless and until Administrative Agent shall have
received instructions in respect thereof from Requisite Lenders (or such other
Lenders as may be required to give such instructions under subsection 10.6) and,
upon receipt of such instructions from Requisite Lenders (or such other Lenders,
as the case may be), Administrative Agent shall be entitled to act or (where so
instructed) refrain from acting, or to exercise such power, discretion or
authority, in accordance with such instructions. Without prejudice to the
generality of the foregoing, (i) Administrative Agent shall be entitled to rely,
and shall be fully protected in relying, upon any communication, instrument or
document believed by it to be genuine and correct and to have been signed or
sent by the proper person or persons, and shall be entitled to rely and shall be
protected in relying on opinions and judgments of attorneys (who may be
attorneys for Borrower and its Subsidiaries), accountants, experts and other
professional advisors selected by it; and (ii) no Lender shall have any right of
action whatsoever against Administrative Agent as a result of Administrative
Agent acting or (where so instructed) refraining from acting under this
Agreement or any of the other Loan Documents in accordance with the instructions
of Requisite Lenders (or such other Lenders as may be required to give such
instructions under subsection 10.6).
D. ADMINISTRATIVE AGENT ENTITLED TO ACT AS LENDER. The agency
hereby created shall in no way impair or affect any of the rights and powers of,
or impose any duties or obligations upon, Administrative Agent in its individual
capacity as a Lender hereunder. With respect to its participation in the Loans
and the Letters of Credit, Administrative Agent shall have the same rights and
powers hereunder as any other Lender and may exercise the same as though it were
not performing the duties and functions delegated to it hereunder, and the term
"Lender" or "Lenders" or any similar term shall, unless the context clearly
otherwise indicates, include Administrative Agent in its individual capacity.
Administrative Agent and its Affiliates
101
may accept deposits from, lend money to and generally engage in any kind of
banking, trust, financial advisory or other business with Borrower or any of its
Affiliates as if it were not performing the duties specified herein, and may
accept fees and other consideration from Borrower for services in connection
with this Agreement and otherwise without having to account for the same to
Lenders.
9.3 REPRESENTATIONS AND WARRANTIES; NO RESPONSIBILITY FOR
APPRAISAL OF CREDITWORTHINESS.
Each Lender represents and warrants that it has made its own
independent investigation of the financial condition and affairs of Borrower and
its Subsidiaries in connection with the making of the Loans and the extensions
of credit hereunder and that it has made and shall continue to make its own
appraisal of the creditworthiness of Borrower and its Subsidiaries.
Administrative Agent shall not have any duty or responsibility, either initially
or on a continuing basis, to make any such investigation or any such appraisal
on behalf of Lenders or, except as expressly provided herein, to provide any
Lender with any credit or other information with respect thereto, whether coming
into its possession before the making of the Loans or at any time or times
thereafter, and Administrative Agent shall not have any responsibility with
respect to the accuracy of or the completeness of any information provided to
Lenders.
9.4 RIGHT TO INDEMNITY.
Each Lender, in proportion to its Pro Rata Share, severally
agrees to indemnify Administrative Agent and its officers, directors, employees,
agents, attorneys, professional advisors and affiliates, to the extent that
Administrative Agent or such Person shall not have been reimbursed by Borrower,
for and against any and all liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses (including reasonable
counsel fees and disbursements and fees and disbursements of any financial
advisor engaged by Administrative Agent) or disbursements of any kind or nature
whatsoever which may be imposed on, incurred by or asserted against
Administrative Agent in exercising its powers, rights and remedies or performing
its duties hereunder or under the other Loan Documents or otherwise in its
capacity as Administrative Agent in any way relating to or arising out of this
Agreement or the other Loan Documents; provided that no Lender shall be liable
for any portion of such liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses or disbursements resulting from
Administrative Agent's gross negligence or willful misconduct. If any indemnity
furnished to Administrative Agent or any other such Person for any purpose
shall, in the reasonable opinion of Administrative Agent, be insufficient or
become impaired, Administrative Agent may call for additional indemnity and
cease, or not commence, to do the acts indemnified against until such additional
indemnity is furnished.
9.5 SUCCESSOR ADMINISTRATIVE AGENT.
Administrative Agent may resign at any time by giving 30 days'
prior written notice thereof to Lenders and Borrower, and Administrative Agent
may be removed at any time with or without cause by an instrument or concurrent
instruments in writing delivered to Borrower and Administrative Agent and signed
by Requisite Lenders. Upon any such notice of
102
resignation or any such removal, Requisite Lenders shall have the right, upon
five Business Days' notice to Borrower, to appoint a successor Administrative
Agent. Upon the acceptance of any appointment as Administrative Agent hereunder
by a successor Administrative Agent, that successor Administrative Agent shall
thereupon succeed to and become vested with all the rights, powers, privileges
and duties of the retiring or removed Administrative Agent and the retiring or
removed Administrative Agent shall be discharged from its duties and obligations
under this Agreement. After any retiring or removed Administrative Agent's
resignation or removal hereunder as Administrative Agent, the provisions of this
Section 9 shall inure to its benefit as to any actions taken or omitted to be
taken by it while it was Administrative Agent under this Agreement.
9.6 COLLATERAL DOCUMENTS AND SUBSIDIARY GUARANTY.
Each Lender hereby further authorizes Administrative Agent, on
behalf of and for the benefit of Lenders, to enter into each Collateral Document
as secured party and to be Administrative Agent for and representative of
Lenders under the Subsidiary Guaranty, and each Lender agrees to be bound by the
terms of each Collateral Document and the Subsidiary Guaranty; provided that
Administrative Agent shall not (i) enter into or consent to any amendment,
modification, termination or waiver of any provision contained in any Collateral
Document or the Subsidiary Guaranty (other than immaterial amendments to correct
mistakes or cure ambiguities) or (ii) release any Collateral or Subsidiary
Guarantor (except as otherwise expressly permitted or required pursuant to the
terms of this Agreement or the applicable Collateral Document), in each case
without the prior consent of Requisite Lenders (or, if required pursuant to
subsection 10.6, all Lenders); provided further, however, that, without further
written consent or authorization from any Lender, Administrative Agent may
execute any documents or instruments necessary to (a) release any Lien
encumbering any item of Collateral that is the subject of a sale or other
disposition of assets permitted by this Agreement or to which Requisite Lenders
have otherwise consented, or (b) release any Subsidiary Guarantor from the
Subsidiary Guaranty if all of the Capital Stock of such Subsidiary Guarantor is
sold to any Person (other than an Affiliate of Borrower) pursuant to a sale or
other disposition permitted hereunder or to which Requisite Lenders have
otherwise consented or (c) subordinate the Liens of Administrative Agent, on
behalf of Lenders, to any Liens permitted by subsection 7.2. Anything contained
in any of the Loan Documents to the contrary notwithstanding, Borrower,
Administrative Agent and each Lender hereby agree that (X) no Lender shall have
any right individually to realize upon any of the Collateral under any
Collateral Document or to enforce the Subsidiary Guaranty, it being understood
and agreed that all powers, rights and remedies under the Collateral Documents
and the Subsidiary Guaranty may be exercised solely by Administrative Agent for
the benefit of Lenders in accordance with the terms thereof, and (Y) in the
event of a foreclosure by Administrative Agent on any of the Collateral pursuant
to a public or private sale, Administrative Agent or any Lender may be the
purchaser of any or all of such Collateral at any such sale and Administrative
Agent, as Administrative Agent for and representative of Lenders (but not any
Lender or Lenders in its or their respective individual capacities unless
Requisite Lenders shall otherwise agree in writing) shall be entitled, for the
purpose of bidding and making settlement or payment of the purchase price for
all or any portion
103
of the Collateral sold at any such public sale, to use and apply any of the
Obligations as a credit on account of the purchase price for any Collateral
payable by Administrative Agent at such sale.
9.7 ADMINISTRATIVE AGENT MAY FILE PROOFS OF CLAIM.
In case of the pendency of any receivership, insolvency,
liquidation, bankruptcy, reorganization, arrangement, adjustment, composition or
other judicial proceeding relative to Borrower or any of the Subsidiaries of
Borrower, Administrative Agent (irrespective of whether the principal of any
Loan shall then be due and payable as herein expressed or by declaration or
otherwise and irrespective of whether Administrative Agent shall have made any
demand on Borrower) shall be entitled and empowered, by intervention in such
proceeding or otherwise
(i) to file and prove a claim for the whole amount of
principal and interest owing and unpaid in respect of the Loans and any
other Obligations that are owing and unpaid and to file such other
papers or documents as may be necessary or advisable in order to have
the claims of Lenders and Agents (including any claim for the
reasonable compensation, expenses, disbursements and advances of
Lenders and Agents and their agents and counsel and all other amounts
due Lenders and Agents under subsections 2.3 and 10.2) allowed in such
judicial proceeding, and
(ii) to collect and receive any moneys or other property
payable or deliverable on any such claims and to distribute the same in
accordance with the terms of the Loan Documents;
and any custodian, receiver, assignee, trustee, liquidator, sequestrator or
other similar official in any such judicial proceeding is hereby authorized by
each Lender to make such payments to Administrative Agent and, if Administrative
Agent shall consent to the making of such payments directly to Lenders, to pay
to Administrative Agent any amount due for the reasonable compensation,
expenses, disbursements and advances of Agents and their agents and counsel, and
any other amounts due Agents under subsections 2.3 and 10.2.
Nothing herein contained shall be deemed to authorize
Administrative Agent to authorize or consent to or accept or adopt on behalf of
any Lender any plan of reorganization, arrangement, adjustment or composition
affecting the Obligations or the rights of any Lenders or to authorize
Administrative Agent to vote in respect of the claim of any Lender in any such
proceeding.
SECTION 10. MISCELLANEOUS
10.1 ASSIGNMENTS AND PARTICIPATIONS IN LOANS AND LETTERS OF CREDIT.
A. General. Subject to subsections 10.1B and 10.1C, each
Lender shall have the right at any time to (i) sell, assign or transfer to any
Eligible Assignee, or (ii) sell participations to any Person in, all or any part
of its Commitments or any Loan or Loans made by it or its Letters of Credit (or
participations in Letters of Credit) or any other interest herein or in any
other Obligations owed to it; provided that no such sale, assignment, transfer
or participation
104
shall, without the consent of Borrower, require Borrower to file a registration
statement with the Securities and Exchange Commission or apply to qualify such
sale, assignment, transfer or participation under the securities laws of any
state; provided, further, that no such sale, assignment, or transfer described
in clause (i) above shall be effective unless and until an Assignment Agreement
effecting such sale, assignment or transfer shall have been accepted by
Administrative Agent and recorded in the Register as provided in subsection
10.1B(ii); and provided, further, that no such sale, assignment, or transfer of
any Letter of Credit or any participation therein may be made separately from a
sale, assignment, transfer or participation of a corresponding interest in the
Revolving Loan Commitment and the Revolving Loans of the Lender effecting such
sale, assignment, transfer or participation. Except as otherwise provided in
this subsection 10.1, no Lender shall, as between Borrower and such Lender, be
relieved of any of its obligations hereunder as a result of any sale, assignment
or transfer of, or any granting of participations in, all or any part of its
Commitments or the Loans, or participations therein, or the other Obligations
owed to such Lender, and such Lender shall remain solely responsible for the
performance of such Obligations, and Borrower shall continue to deal solely and
directly with such Lender in connection with such Lender's rights and
obligations under this Agreement.
B. ASSIGNMENTS.
(i) Amounts and Terms of Assignments. Each Commitment or
Loan may (a) be assigned in any amount to another Lender, or to an
Affiliate or Approved Fund of the assigning Lender or another Lender,
with the giving of notice to Borrower and Administrative Agent or (b)
be assigned in an aggregate amount of not less than $1,000,000 (or such
lesser amount as shall constitute the aggregate amount of the
Commitments or Loans of the assigning Lender) to any other Eligible
Assignee treating any two or more Approved Funds with the same
investment advisor as a single Eligible Assignee with the consent of
Borrower (unless a Potential Event of Default or an Event of Default
has occurred and is continuing) and Administrative Agent (which consent
of Borrower and Administrative Agent shall not be unreasonably withheld
or delayed), and each partial assignment shall be made as an assignment
of a proportionate part of all the assigning Lender's rights and
obligations under this Agreement with respect to the Loan or the
Commitments assigned. To the extent of any such assignment in
accordance with either clause (a) or (b) above, the assigning Lender
shall be relieved of its obligations with respect to its Commitments or
Loans or the portion thereof so assigned. The parties to each such
assignment shall execute and deliver to Administrative Agent, for its
acceptance and recording in the Register, an Assignment Agreement,
together with a processing and recordation fee of $3,500 (provided that
only one such fee shall be required in connection with a simultaneous
assignment to a group of Approved Funds with the same investment
advisor; provided, further, that under no circumstances shall such fee
by payable by a Replaced Lender (as defined in subsection 2.9C)) and
such forms (including an administrative questionnaire if the Eligible
Assignee is not a Lender), certificates or other evidence, if any, with
respect to United States federal income tax withholding matters as the
assignee under such Assignment Agreement may be required to deliver to
Administrative Agent pursuant to subsection 2.7B(iii)(a). Upon such
execution, delivery, acceptance and recordation, from and after the
effective date
105
specified in such Assignment Agreement, (y) the assignee thereunder
shall be a party hereto and, to the extent that rights and obligations
hereunder have been assigned to it pursuant to such Assignment
Agreement, shall have the rights and obligations of a Lender hereunder,
and (z) the assigning Lender thereunder shall, to the extent that
rights and obligations hereunder have been assigned by it pursuant to
such Assignment Agreement, relinquish its rights (other than any rights
which survive the termination of this Agreement under subsection 10.9B)
and be released from its obligations under this Agreement (and, in the
case of an Assignment Agreement covering all or the remaining portion
of an assigning Lender's rights and obligations under this Agreement,
such Lender shall cease to be a party hereto except for any rights
retained above; provided that, anything contained in any of the Loan
Documents to the contrary notwithstanding, if such Lender is the
issuing Lender with respect to any outstanding Letters of
Credit such Lender shall continue to have all rights and obligations of
an Issuing Lender with respect to such Letters of Credit until the
cancellation or expiration of such Letters of Credit and the
reimbursement of any amounts drawn thereunder). The Commitments
hereunder shall be modified to reflect the Commitment of such assignee
and any remaining Commitment of such assigning Lender and, if any such
assignment occurs after the issuance of any Notes hereunder, the
assigning Lender shall, upon the effectiveness of such assignment or as
promptly thereafter as practicable, surrender its applicable Notes, if
any, to Administrative Agent for cancellation, and thereupon new Notes
shall, if so requested by the assignee and/or the assigning Lender in
accordance with subsection 2.1D, be issued to the assignee and/or to
the assigning Lender, substantially in the form of Exhibit IX annexed
hereto, as the case may be, with appropriate insertions, to
reflect the new Commitments and/or outstanding Revolving Loans and/or
outstanding Term Loans, as the case may be, of the assignee and/or the
assigning Lender. Any assignment or transfer by a Lender of rights or
obligations under this Agreement that does not comply with this
subsection 10.1B shall be treated for purposes of this Agreement as a
sale by such Lender of a participation in such rights and obligations
in accordance with subsection 10.1C.
(ii) Acceptance by Administrative Agent; Recordation in
Register. Upon its receipt of an Assignment Agreement executed by an
assigning Lender and an assignee representing that it is an Eligible
Assignee, together with the processing and recordation fee (if so
required) referred to in subsection 10.1B(i) and any forms,
certificates or other evidence with respect to United States federal
income tax withholding matters that such assignee may be required to
deliver to Administrative Agent pursuant to subsection 2.7B(iii)(a),
Administrative Agent shall, if Administrative Agent (and if necessary,
Borrower) has consented to the assignment evidenced thereby (in each
case to the extent such consent is required pursuant to subsection
10.1B(i)), (a) accept such Assignment Agreement by executing a
counterpart thereof as provided therein (which acceptance shall
evidence any required consent of Administrative Agent to such
assignment), (b) record the information contained therein in the
Register, and (c) give prompt notice thereof to Borrower.
Administrative Agent shall maintain a copy of each Assignment Agreement
delivered to and accepted by it as provided in this subsection
10.1B(ii).
106
C. PARTICIPATIONS. Any Lender may, without the consent of, or
notice to, Borrower or Administrative Agent, sell participations to one or more
banks or other entities (a "PARTICIPANT") in all or a portion of such Lender's
rights and/or obligations under this Agreement (including all or a portion of
its Commitment and/or the Loans owing to it); provided that (i) such Lender's
obligations under this Agreement shall remain unchanged, (ii) such Lender shall
remain solely responsible to the other parties hereto for the performance of
such obligations, and (iii) Borrower, Administrative Agent and the other Lenders
shall continue to deal solely and directly with such Lender in connection with
such Lender's rights and obligations under this Agreement. Any agreement or
instrument pursuant to which a Lender sells such a participation shall provide
that such Lender shall retain the sole right to enforce the Loan Documents and
to approve any amendment, modification or waiver of any provision of the Loan
Documents; provided that such agreement or instrument may provide that such
Lender will not, without the consent of such Participant, agree to any
amendment, modification or waiver that affects such Participant if such
amendment, modification or waiver requires the unanimous written consent of all
Lenders pursuant to subsection 10.6. Subject to subsection 10.1D, Borrower
agrees that each Participant shall be entitled to the benefits of subsections
2.7, and 2.8, to the same extent as if it were a Lender and had acquired its
interest by assignment pursuant to this subsection 10.1C; provided, however,
that in no event shall Borrower be obligated to make any payment with respect to
such subsections which is greater than the amount that Borrower would have paid
to the Lender had no such participation been sold. To the extent permitted by
law, each Participant also shall be entitled to the benefits of subsection 10.4
as though it were a Lender, provided such Participant agrees to be subject to
subsection 10.5 as though it were a Lender if any amounts outstanding under this
Agreement are due and unpaid, or shall have been declared or shall have become
due and payable upon the occurrence of an Event of Default, each participant
shall be deemed to have the right of set-off in respect of its participating
interest in amounts owing under this Agreement to the same extent as if the
amount of its participating interest were owing directly to it as a Lender under
this Agreement.
D. NO GREATER PAYMENTS TO PARTICIPANTS. A Participant shall
not be entitled to receive any greater payment under subsections 2.7 and 2.8
than the applicable Lender would have been entitled to receive with respect to
the participation sold to such Participant, unless the sale of the participation
to such Participant is made with Borrower's prior written consent. A Participant
that would be a Non-US Lender if it were a Lender shall not be entitled to the
benefits of subsection 2.7 unless Borrower is notified of the participation sold
to such Participant and such Participant agrees, for the benefit of Borrower, to
comply with subsection 2.7B(iii) as though it were a Lender.
E. ASSIGNMENTS TO SECURED PARTIES AND TRUSTEES. In addition to
the assignments and participations permitted under the foregoing provisions of
this subsection 10.1, (a) any Lender may assign and pledge all or any portion of
its Loans, the other Obligations owed to such Lender, and its Notes to any
creditor, including any Federal Reserve Bank, as collateral security pursuant to
Regulation A of the Board of Governors of the Federal Reserve System and any
operating circular issued by such Federal Reserve Bank; provided that (i) no
Lender shall, as between Borrower and such Lender, be relieved of any of its
obligations hereunder as a result of any such assignment and pledge and (ii) in
no event shall such creditor be considered to be a
107
"Lender" or be entitled to require the assigning Lender to take or omit to take
any action hereunder, (b) any Lender that is a Fund may pledge its Loans and/or
Notes to its trustee for the benefit of its investors.
F. INFORMATION. Each Lender may furnish any information
concerning Borrower and its Subsidiaries in the possession of that Lender from
time to time to assignees and participants (including prospective assignees and
participants), subject to subsection 10.19.
G. REPRESENTATIONS OF LENDERS. Each Lender listed on the
signature pages hereof hereby represents and warrants (i) that it is an Eligible
Assignee described in clause (A) of the definition thereof; (ii) that it has
experience and expertise in the making of loans such as the Loans; and (iii)
that it will make its Loans for its own account in the ordinary course of its
business and without a present view to distribution of such Loans within the
meaning of the Securities Act or the Exchange Act or other federal securities
laws (it being understood that, subject to the provisions of this subsection
10.1, the disposition of such Loans or any interests therein shall at all times
remain within its exclusive control). Each Lender that becomes a party hereto
pursuant to an Assignment Agreement shall be deemed to agree that the
representations and warranties of such Lender contained in such Assignment
Agreement are incorporated herein by this reference.
10.2 EXPENSES.
Whether or not the transactions contemplated hereby shall be
consummated, Borrower agrees to pay promptly (i) all the actual and reasonable
costs and expenses of preparation of the Loan Documents and any consents,
amendments, waivers or other modifications thereto; (ii) all the costs of
furnishing all opinions by counsel for Borrower (including any opinions
requested by Lenders as to any legal matters arising hereunder) and of
Borrower's performance of and compliance with all agreements and conditions on
its part to be performed or complied with under this Agreement and the other
Loan Documents including with respect to confirming compliance with
environmental, insurance and solvency requirements; (iii) the reasonable fees,
expenses and disbursements of counsel to Administrative Agent in connection with
the negotiation, preparation, execution and administration of the Loan Documents
and any consents, amendments, waivers or other modifications thereto and any
other documents or matters requested by Borrower; (iv) all the actual costs and
reasonable expenses of creating and perfecting Liens in favor of Administrative
Agent on behalf of Lenders pursuant to any Collateral Document, including filing
and recording fees, expenses and taxes, stamp or documentary taxes, search fees,
title insurance premiums, and reasonable fees, expenses and disbursements of
counsel to Administrative Agent and of counsel providing any opinions that
Administrative Agent or Requisite Lenders may request in respect of the
Collateral Documents or the Liens created pursuant thereto; (v) all the actual
costs and reasonable expenses (including the reasonable fees, expenses and
disbursements of any auditors, accountants or appraisers and any environmental
or other consultants, advisors and agents employed or retained by Administrative
Agent or its counsel) of obtaining and reviewing any environmental audits or
reports provided for as a result of its due diligence or 6.7B; (vii) all other
actual and reasonable costs and expenses incurred by Administrative Agent in
connection with the syndication of the Commitments and the negotiation,
preparation and execution of the Loan Documents and any
108
consents, amendments, waivers or other modifications thereto and the
transactions contemplated thereby; and (viii) after the occurrence of an Event
of Default, all costs and expenses, including reasonable attorneys' fees
(including allocated costs of internal counsel) and costs of settlement,
incurred by Administrative Agent and each Lender in enforcing any Obligations of
or in collecting any payments due from any Loan Party hereunder or under the
other Loan Documents by reason of such Event of Default (including in connection
with the sale of, collection from, or other realization upon any of the
Collateral or the enforcement of the Subsidiary Guaranty) or in connection with
any refinancing or restructuring of the credit arrangements provided under this
Agreement in the nature of a "work-out" or pursuant to any insolvency or
bankruptcy proceedings.
10.3 INDEMNITY.
A. INDEMNITY. In addition to the payment of expenses pursuant
to subsection 10.2, whether or not the transactions contemplated hereby shall be
consummated, Borrower agrees to defend (subject to Indemnitees' selection of
counsel), indemnify, pay and hold harmless Administrative Agent and Lenders, and
the officers, directors, employees, counsel, agents, representatives, advisors
and affiliates of Administrative Agent and Lenders (collectively called the
"INDEMNITEES"), from and against any and all Indemnified Liabilities (as
hereinafter defined); provided that Borrower shall not have any obligation to
any Indemnitee hereunder with respect to any Indemnified Liabilities to the
extent such Indemnified Liabilities arise solely from the gross negligence or
willful misconduct of that Indemnitee as determined by a final judgment of a
court of competent jurisdiction.
As used herein, "INDEMNIFIED LIABILITIES" means, collectively,
any and all liabilities, obligations, losses, damages (including natural
resource damages), penalties, actions, judgments, suits, claims (including
Environmental Claims), costs (including the costs of any investigation, study,
sampling, testing, abatement, cleanup, removal, remediation or other response
action necessary to remove, remediate, clean up or xxxxx any Hazardous Materials
Activity), expenses and disbursements of any kind or nature whatsoever
(including the reasonable fees and disbursements of counsel for Indemnitees in
connection with any investigative, administrative or judicial proceeding
commenced or threatened by any Person, whether or not any such Indemnitee shall
be designated as a party or a potential party thereto, and any fees or expenses
incurred by Indemnitees in enforcing this indemnity), whether direct, indirect
or consequential and whether based on any federal, state or foreign laws,
statutes, rules or regulations (including securities and commercial laws,
statutes, rules or regulations and Environmental Laws), on common law or
equitable cause or on contract or otherwise, that may be imposed on, incurred
by, or asserted against any such Indemnitee, in any manner relating to or
arising out of (i) this Agreement or the other Loan Documents or the
transactions contemplated hereby or thereby (including Lenders' agreement to
make the Loans hereunder or the use or intended use of the proceeds thereof or
the issuance of Letters of Credit hereunder or the use or intended use of any
thereof, or any enforcement of any of the Loan Documents (including any sale of,
collection from, or other realization upon any of the Collateral or the
enforcement of the Subsidiary Guaranty), (ii) the statements contained in the
commitment letter delivered by any Lender to Borrower or Administrative Agent
with respect thereto, or (iii) any Environmental Claim or any Hazardous
Materials Activity relating to or arising from, directly or indirectly, any
109
past or present activity, operation, land ownership, or practice of Borrower or
any of its Subsidiaries.
To the extent that the undertakings to defend, indemnify, pay
and hold harmless set forth in this subsection 10.3 may be unenforceable in
whole or in part because they are violative of any law or public policy,
Borrower shall contribute the maximum portion that it is permitted to pay and
satisfy under applicable law to the payment and satisfaction of all Indemnified
Liabilities incurred by Indemnitees or any of them.
10.4 SET-OFF.
In addition to any rights now or hereafter granted under
applicable law and not by way of limitation of any such rights, upon the
occurrence of any Event of Default each Lender is hereby authorized by Borrower
at any time or from time to time, without notice to Borrower or to any other
Person, any such notice being hereby expressly waived, to set off and to
appropriate and to apply any and all deposits or other amounts held by any
Lender (or any Affiliate or such Lender) for the credit or account of Borrower
(including Indebtedness evidenced by certificates of deposit, whether matured or
unmatured, but not including special or trust accounts) and any other
Indebtedness at any time held or owing by that Lender or any Affiliate of such
Lender to or for the credit or the account of Borrower and each other Loan Party
against and on account of the obligations and liabilities of Borrower and each
other Loan Party to that Lender (or any Affiliate of such Lender) under this
Agreement, the Letters of Credit and participations therein and the other Loan
Documents, including all claims of any nature or description arising out of or
connected with this Agreement, the Letters of Credit and participations therein
or any other Loan Document, irrespective of whether or not (i) that Lender shall
have made any demand hereunder or (ii) the principal of or the interest on the
Loans or any amounts in respect of the Letters of Credit or any other amounts
due hereunder or under any of the other Loan Documents shall have become due and
payable pursuant to Section 8 and although said obligations and liabilities, or
any of them, may be contingent or unmatured.
10.5 RATABLE SHARING.
Lenders hereby agree among themselves that if any of them
shall, whether by voluntary payment (other than a voluntary prepayment of Loans
made and applied in accordance with the terms of this Agreement), by realization
upon security, through the exercise of any right of set-off or banker's lien, by
counterclaim or cross action or by the enforcement of any right under the Loan
Documents or otherwise, or as adequate protection of a deposit treated as cash
collateral under the Bankruptcy Code, receive payment or reduction of a
proportion of the aggregate amount of principal, interest, amounts payable in
respect of Letters of Credit, fees and other amounts then due and owing to that
Lender hereunder or under the other Loan Documents (collectively, the "Aggregate
Amounts Due" to such Lender) that is greater than the proportion received by any
other Lender in respect of the Aggregate Amounts Due to such other Lender
hereunder, then the Lender receiving such proportionately greater payment shall
(i) notify Administrative Agent and each other Lender of the receipt of such
payment and (ii) apply a portion of such payment to purchase participations
(which it shall be deemed to have purchased from each seller of a participation
simultaneously upon the receipt by such seller of its portion of
110
such payment) in the Aggregate Amounts Due to the other Lenders so that all such
recoveries of Aggregate Amounts Due shall be shared by all Lenders in proportion
to the Aggregate Amounts Due to them hereunder; provided that if all or part of
such proportionately greater payment received by such purchasing Lender is
thereafter recovered from such Lender upon the bankruptcy or reorganization of
Borrower or otherwise (and whether by litigation, demand, settlement or
otherwise), those purchases shall be rescinded and the purchase prices paid for
such participations shall be returned to such purchasing Lender ratably to the
extent of such recovery, but without interest. Borrower expressly consents to
the foregoing arrangement and agrees that any holder of a participation so
purchased may exercise any and all rights of banker's lien, set-off or
counterclaim with respect to any and all monies owing by Borrower to that holder
with respect thereto as fully as if that holder were owed the amount of the
participation held by that holder.
10.6 AMENDMENTS AND WAIVERS.
No amendment, modification, termination or waiver of any
provision of this Agreement or of the Notes or of any of the other Loan
Documents, and no consent to any departure by Borrower herefrom or therefrom,
shall in any event be effective without the written concurrence of Requisite
Lenders, unless otherwise provided elsewhere in this Agreement; provided that in
addition:
(a) any such amendment, modification, termination, waiver
or consent which:
(i) postpones the date or reduces the amount of
any scheduled payment of principal of any of the Loans;
(ii) postpones the date on which any interest or
any fees are payable or reduces the amount of any interest
(other than any waiver of any increase in the interest rate
applicable to such Loans pursuant to subsection 2.2E) or any
fees payable hereunder;
(iii) changes in any manner the definition of "Pro
Rata Share" or the definition of "Requisite Lenders";
(iv) changes in any manner any provision of this
Agreement which, by its terms, expressly requires the approval
or concurrence of all Lenders;
(v) releases any Lien granted in favor of
Administrative Agent with respect to all or substantially all of
the Collateral;
(vi) releases all or substantially all of the
Subsidiary Guarantors from their obligations under the
Subsidiary Guaranty, in each case other than in accordance with
the terms of the Loan Documents; or
(vii) changes in any manner the provisions
contained in this subsection 10.6
111
shall be effective only if evidenced by the written concurrence
of all Lenders affected thereby.
In addition,
(b) no amendment, modification, termination or waiver of
any provision of any Note shall be effective without the written
concurrence of the Lender that is the holder of that Note;
(c) no amendment, modification, termination or waiver of
any provision of subsection 2.1 or of any other provision of this
Agreement relating to the Term Loan Commitments or the Revolving Loan
Commitments shall increase the Commitments of any Lender over the
amount thereof then in effect without the consent of such Lender (it
being understood that amendments, modifications or waivers of
conditions precedent, representations and warranties, covenants or
Events of Default or of a mandatory reduction in the Commitments shall
not constitute an increase of the Commitment of any Lender, and that an
increase in the available portion of any Commitment of any Lender shall
not constitute an increase in the Commitment of such Lender);
(d) no amendment, modification, termination or waiver of
any provision of Section 9 or of any other provision of this Agreement
that, by its terms, expressly requires the approval or concurrence of
Administrative Agent shall be effective without the written concurrence
of Administrative Agent.
Administrative Agent may, but shall have no obligation to,
with the concurrence of any Lender, execute amendments, modifications, waivers
or consents on behalf of that Lender. Any waiver or consent shall be effective
only in the specific instance and for the specific purpose for which it was
given. No notice to or demand on Borrower in any case shall entitle Borrower to
any other or further notice or demand in similar or other circumstances. Any
amendment, modification, termination, waiver or consent effected in accordance
with this subsection 10.6 shall be binding upon each Lender at the time
outstanding, each future Lender and, if signed by Borrower, on Borrower.
Notwithstanding anything contained herein to the contrary, as among Lenders and
Administrative Agent in connection with the exercise of remedies under any of
Loan Documents, the written concurrence of Requisite Lenders shall be required
for Administrative Agent to execute proxy rights in the election of the board of
directors of any Loan Party owning real property or to acquire any ownership
interest in real property of any Loan Party.
10.7 INDEPENDENCE OF COVENANTS.
All covenants hereunder shall be given independent effect so
that if a particular action or condition is not permitted by any of such
covenants, the fact that it would be permitted by an exception to, or would
otherwise be within the limitations of, another covenant shall not avoid the
occurrence of an Event of Default or Potential Event of Default if such action
is taken or condition exists.
112
10.8 NOTICES; EFFECTIVENESS OF SIGNATURES.
Unless otherwise specifically provided herein, any notice or
other communication herein required or permitted to be given shall be in writing
and may be personally served, telexed or sent by facsimile or United States mail
or courier service and shall be deemed to have been given when delivered in
person or by courier service, upon receipt of facsimile or telex, or three
Business Days after depositing it in the United States mail with postage prepaid
and properly addressed; provided that notices to Administrative Agent shall not
be effective until received. For the purposes hereof, the address of each party
hereto shall be as set forth under such party's name on the signature pages
hereof or (i) as to Borrower and Administrative Agent, such other address as
shall be designated by such Person in a written notice delivered to the other
parties hereto and (ii) as to each other party, such other address as shall be
designated by such party in a written notice delivered to Administrative Agent.
Electronic mail may be used to distribute routine communications, such as
financial statements and other information; provided, however, that no signature
with respect to any notice, request, agreement, waiver, amendment or other
document or any notice that is intended to have binding effect may be sent by
electronic mail.
Loan Documents and notices under the Loan Documents may be transmitted
and/or signed by facsimile. The effectiveness of any such documents and
signatures shall, subject to applicable law, have the same force and effect as
an original copy with manual signatures and shall be binding on all Loan
Parties, Agents and Lenders. Administrative Agent may also require that any such
documents and signature be confirmed by a manually-signed copy thereof;
provided, however, that the failure to request or deliver any such
manually-signed copy shall not affect the effectiveness of any facsimile
document or signature.
10.9 SURVIVAL OF REPRESENTATIONS, WARRANTIES AND AGREEMENTS.
A. All representations, warranties and agreements made
herein shall survive the execution and delivery of this Agreement and the making
of the Loans and the issuance of the Letters of Credit hereunder.
B. Notwithstanding anything in this Agreement or implied
by law to the contrary, the agreements of Borrower set forth in subsections 2.7,
2.8, 3.5A, 5.12, 10.2, 10.3, 10.4, 10.17 and 10.18 and the agreements of Lenders
set forth in subsections 9.2C, 9.4, 10.5 and 10.19 shall survive the payment of
the Loans, the cancellation or expiration of the Letters of Credit and the
reimbursement of any amounts drawn thereunder, and the termination of this
Agreement.
10.10 FAILURE OR INDULGENCE NOT WAIVER; REMEDIES CUMULATIVE.
No failure or delay on the part of Administrative Agent or any
Lender in the exercise of any power, right or privilege hereunder or under any
other Loan Document shall impair such power, right or privilege or be construed
to be a waiver of any default or acquiescence therein, nor shall any single or
partial exercise of any such power, right or privilege preclude other or further
exercise thereof or of any other power, right or privilege. All rights and
113
remedies existing under this Agreement and the other Loan Documents are
cumulative to, and not exclusive of, any rights or remedies otherwise available.
10.11 MARSHALLING; PAYMENTS SET ASIDE.
Neither Administrative Agent nor any Lender shall be under any
obligation to marshal any assets in favor of Borrower or any other party or
against or in payment of any or all of the Obligations. To the extent that
Borrower makes a payment or payments to Administrative Agent or Lenders (or to
Administrative Agent for the benefit of Lenders), or Administrative Agent or
Lenders enforce any security interests or exercise their rights of setoff, and
such payment or payments or the proceeds of such enforcement or setoff or any
part thereof are subsequently invalidated, declared to be fraudulent or
preferential, set aside and/or required to be repaid to a trustee, receiver or
any other party under any bankruptcy law, any other state or federal law, common
law or any equitable cause (whether by litigation, demand, settlement or
otherwise), then, to the extent of such recovery, the obligation or part thereof
originally intended to be satisfied, and all Liens, rights and remedies therefor
or related thereto, shall be revived and continued in full force and effect as
if such payment or payments had not been made or such enforcement or setoff had
not occurred.
10.12 SEVERABILITY.
In case any provision in or obligation under this Agreement or
the Notes shall be invalid, illegal or unenforceable in any jurisdiction, the
validity, legality and enforceability of the remaining provisions or
obligations, or of such provision or obligation in any other jurisdiction, shall
not in any way be affected or impaired thereby.
10.13 OBLIGATIONS SEVERAL; INDEPENDENT NATURE OF LENDERS' RIGHTS.
The obligations of Lenders hereunder are several and no Lender
shall be responsible for the obligations or Commitments of any other Lender
hereunder. Nothing contained herein or in any other Loan Document, and no action
taken by Lenders pursuant hereto or thereto, shall be deemed to constitute
Lenders, or Lenders and Borrower, as a partnership, an association, a joint
venture or any other kind of entity. The amounts payable at any time hereunder
to each Lender shall be a separate and independent debt, and each Lender shall
be entitled to protect and enforce its rights arising out of this Agreement and
it shall not be necessary for any other Lender to be joined as an additional
party in any proceeding for such purpose.
10.14 HEADINGS.
Section and subsection headings in this Agreement are included
herein for convenience of reference only and shall not constitute a part of this
Agreement for any other purpose or be given any substantive effect.
114
10.15 APPLICABLE LAW.
THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES
HEREUNDER SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN
ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK (INCLUDING SECTION
5-1401 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK), WITHOUT REGARD
TO CONFLICTS OF LAWS PRINCIPLES.
10.16 SUCCESSORS AND ASSIGNS.
The provisions of this Agreement shall be binding upon and
inure to the benefit of the parties hereto and their respective successors and
assigns permitted hereby, except that Borrower may not assign or otherwise
transfer any of its rights or obligations hereunder without the prior written
consent of each Lender (and any attempted assignment or transfer by Borrower
without such consent shall be null and void). Nothing in this Agreement,
expressed or implied, shall be construed to confer upon any Person (other than
the parties hereto, their respective successors and assigns permitted hereby
and, to the extent expressly contemplated hereby, Affiliates of Administrative
Agent and Affiliates of Lenders) any legal or equitable right, remedy or claim
under or by reason of this Agreement.
10.17 CONSENT TO JURISDICTION AND SERVICE OF PROCESS.
ALL JUDICIAL PROCEEDINGS BROUGHT AGAINST BORROWER ARISING OUT
OF OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT, OR ANY OBLIGATIONS
HEREUNDER OR THEREUNDER, MAY BE BROUGHT IN ANY STATE OR FEDERAL COURT OF
COMPETENT JURISDICTION IN XXX XXXXX, XXXXXX XXX XXXX XX XXX XXXX. BY EXECUTING
AND DELIVERING THIS AGREEMENT, BORROWER, FOR ITSELF AND IN CONNECTION WITH ITS
PROPERTIES, IRREVOCABLY
(I) ACCEPTS GENERALLY AND UNCONDITIONALLY THE NONEXCLUSIVE
JURISDICTION AND VENUE OF SUCH COURTS;
(II) WAIVES ANY DEFENSE OF FORUM NON CONVENIENS AND ANY
OBJECTION TO VENUE;
(III) AGREES THAT SERVICE OF ALL PROCESS IN ANY SUCH
PROCEEDING IN ANY SUCH COURT MAY BE MADE BY REGISTERED OR CERTIFIED
MAIL, RETURN RECEIPT REQUESTED, TO BORROWER AT ITS ADDRESS PROVIDED IN
ACCORDANCE WITH SUBSECTION 10.8;
(IV) AGREES THAT SERVICE AS PROVIDED IN CLAUSE (III) ABOVE
IS SUFFICIENT TO CONFER PERSONAL JURISDICTION OVER BORROWER IN ANY SUCH
PROCEEDING IN ANY SUCH COURT, AND
115
OTHERWISE CONSTITUTES EFFECTIVE AND BINDING SERVICE IN EVERY RESPECT;
(V) AGREES THAT LENDERS RETAIN THE RIGHT TO SERVE PROCESS
IN ANY OTHER MANNER PERMITTED BY LAW OR TO BRING PROCEEDINGS AGAINST
BORROWER IN THE COURTS OF ANY OTHER JURISDICTION; AND
(VI) AGREES THAT THE PROVISIONS OF THIS SUBSECTION 10.17
RELATING TO JURISDICTION AND VENUE SHALL BE BINDING AND ENFORCEABLE TO
THE FULLEST EXTENT PERMISSIBLE UNDER NEW YORK GENERAL OBLIGATIONS LAW
SECTION 5-1402 OR OTHERWISE.
10.18 WAIVER OF JURY TRIAL.
EACH OF THE PARTIES TO THIS AGREEMENT HEREBY AGREES TO WAIVE
ITS RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON
OR ARISING OUT OF THIS AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS OR ANY
DEALINGS BETWEEN THEM RELATING TO THE SUBJECT MATTER OF THIS LOAN TRANSACTION OR
THE LENDER/BORROWER RELATIONSHIP THAT IS BEING ESTABLISHED. The scope of this
waiver is intended to be all-encompassing of all disputes that may be filed in
any court and that relate to the subject matter of this transaction, including
contract claims, tort claims, breach of duty claims and all other common law and
statutory claims. Each party hereto acknowledges that this waiver is a material
inducement to enter into a business relationship, that each has already relied
on this waiver in entering into this Agreement, and that each will continue to
rely on this waiver in their related future dealings. Each party hereto further
warrants and represents that it has reviewed this waiver with its legal counsel
and that it knowingly and voluntarily waives its jury trial rights following
consultation with legal counsel. THIS WAIVER IS IRREVOCABLE, MEANING THAT IT MAY
NOT BE MODIFIED EITHER ORALLY OR IN WRITING (OTHER THAN BY A MUTUAL WRITTEN
WAIVER SPECIFICALLY REFERRING TO THIS SUBSECTION 10.18 AND EXECUTED BY EACH OF
THE PARTIES HERETO), AND THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS,
RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS AGREEMENT OR ANY OF THE OTHER
LOAN DOCUMENTS OR TO ANY OTHER DOCUMENTS OR AGREEMENTS RELATING TO THE LOANS
MADE HEREUNDER. In the event of litigation, this Agreement may be filed as a
written consent to a trial by the court.
10.19 CONFIDENTIALITY.
Each Lender shall hold all non-public information obtained
pursuant to the requirements of this Agreement that has been identified in
writing as confidential by Borrower in accordance with such Lender's customary
procedures for handling confidential information of this nature, it being
understood and agreed by Borrower that in any event a Lender may make
disclosures (a) to its and its Affiliates' directors, officers, employees and
agents, including accountants, legal counsel and other advisors (it being
understood that the Persons to whom such
116
disclosure is made will be informed of the confidential nature of such
information and instructed to keep such information confidential), (b) to the
extent requested by any Government Authority, (c) to the extent required by
applicable laws or regulations or by any subpoena or similar legal process, (d)
to any other party to this Agreement, (e) in connection with the exercise of any
remedies hereunder or any suit, action or proceeding relating to this Agreement
or the enforcement of rights hereunder, (f) subject to an agreement containing
provisions substantially the same as those of this subsection 10.19, to (i) any
Eligible Assignee of or Participant in, or any prospective Eligible Assignee of
or Participant in, any of its rights or obligations under this Agreement or (ii)
any direct or indirect contractual counterparty or prospective counterparty (or
such contractual counterparty's or prospective counterparty's professional
advisor) to any credit derivative transaction relating to obligations of
Borrower, (g) with the written consent of Borrower, (h) to the extent such
information (i) becomes publicly available other than as a result of a breach of
this subsection 10.19, or (ii) becomes available to Administrative Agent or any
Lender on a nonconfidential basis from a source other than Borrower, or (i) to
the National Association of Insurance Commissioners or any other similar
organization or any nationally recognized rating agency that requires access to
information about a Lender's or its Affiliates' investment portfolio in
connection with ratings issued with respect to such Lender or its Affiliates and
that no written or oral communications from counsel to an Agent and no
information that is or is designated as privileged or as attorney work product
may be disclosed to any Person unless such Person is a Lender or a participant
hereunder; provided that, unless specifically prohibited by applicable law or
court order, each Lender shall notify Borrower of any request by any Government
Authority or representative thereof (other than any such request in connection
with any examination of the financial condition of such Lender by such
Government Authority) for disclosure of any such non-public information prior to
disclosure of such information; and provided, further, that in no event shall
any Lender be obligated or required to return any materials furnished by
Borrower or any of its Subsidiaries. Notwithstanding anything contained herein
to the contrary, Borrower understands and agrees that Administrative Agent and
each of the institutions identified as "Lead Arranger," "Bookrunner," "Co-Lead
Arranger," "Documentation Agent" or "Co-Syndication Agent" on the title page to
this Agreement may make customary disclosures for advertising and "league table"
purposes.
10.20 LEAD ARRANGER, BOOKRUNNER, DOCUMENTATION AGENT AND SYNDICATION
AGENT.
None of the institutions identified as "Lead Arranger,"
"Co-Lead Arranger," "Documentation Agent" or "Co-Syndication Agent" on the title
page to this Agreement shall have any obligations, liabilities or duties under
this Agreement other than those applicable to a Lender (but only if such
institution is a Lender) as such, and no such institution shall have or be
deemed to have any fiduciary relationship with any Lender. Each Lender
acknowledges that it has not relied, and will not rely, on any such institution
in deciding to enter into this Agreement or in taking or not taking any action
hereunder.
10.21 COUNTERPARTS; EFFECTIVENESS.
This Agreement and any amendments, waivers, consents or
supplements hereto or in connection herewith may be executed in any number of
counterparts and by different parties hereto in separate counterparts, each of
which when so executed and delivered shall be deemed
117
an original, but all such counterparts together shall constitute but one and the
same instrument; signature pages may be detached from multiple separate
counterparts and attached to a single counterpart so that all signature pages
are physically attached to the same document. This Agreement shall become
effective upon the execution of a counterpart hereof by each of the parties
hereto and receipt by Borrower and Administrative Agent of written or telephonic
notification of such execution and authorization of delivery thereof.
10.22 LIMITATION OF LIABILITY.
Neither the Administrative Agent or any Lender shall be
responsible or liable to any other party or any other person for consequential
or punitive damages that may be alleged as a result of this Agreement or any
other Loan Document.
[Remainder of page intentionally left blank]
118
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed and delivered by their respective officers
thereunto duly authorized as of the date first written above.
BORROWER:
PRIME HOSPITALITY CORP.
By: /s/ Xxxxxxx Xxxxxx
--------------------------
Name : Xxxxxxx Xxxxxx
Title: Senior Vice President,
Chief Financial Officer and Secretary
------------------------------------
Notice Address:
Prime Hospitality Corp.
000 Xxxxx 00 Xxxx
Xxxxxxxxx, Xxx Xxxxxx 00000-0000
Attention: President and Law Department
S-1
ADMINISTRATIVE AGENT:
CANADIAN IMPERIAL BANK OF COMMERCE,
as Administrative Agent
By:/s/ Xxxx Xxxxxx
-----------------------------
Name: Xxxx Xxxxxx
Title: Managing Director
CIBC World Markets Corp., AS AGENT
Notice Address:
CANADIAN IMPERIAL BANK OF COMMERCE
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn.: Agency Services Dept.
Facsimile No.: (000) 000-0000
With a Copy to:
CIBC WORLD MARKETS CORP.
00000 Xxxxxxxx Xxxxxxxxx, Xxxxx 0000
Xxx Xxxxxxx, XX 00000
Facsimile No.: (000) 000-0000
S-2
LENDERS:
CIBC INC., as a Lender
By:/s/ Xxxx Xxxxxx
-----------------------------
Name: Xxxx Xxxxxx
Title: Managing Director
CIBC World Markets Corp., AS AGENT
Notice Address:
CIBC INC.
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn.: Agency Services Dept.
Facsimile No.: (000) 000-0000
With a Copy to:
CIBC WORLD MARKETS CORP.
00000 Xxxxxxxx Xxxxxxxxx, Xxxxx 0000
Xxx Xxxxxxx, XX 00000
Facsimile No.: (000) 000-0000
S-3
PNC BANK, NATIONAL ASSOCIATION, as a Lender
By: /S/ XXXXXX X. XXXXXX
--------------------
Name: Xxxxxx Xxxxxx
Title: Vice President
Notice Address:
Xxx Xxxxx Xxxxxx Xxxx., 00xx Xxxxx
Xxxx Xxxxxxxxx, XX 00000
(000) 000-0000 - office
(000) 000-0000 - fax
S-4
MANUFACTURERS AND TRADERS TRUST COMPANY, as a Lender
By: /S/ XXXXX X. XXXXXX
-------------------
Name: Xxxxx Xxxxxx
Title: Vice President
Notice Address:
M&T Bank
ATTN: Xxxxx Xxxxxx
000 Xxxx Xxxxxx, 0xx Xxxxx
Xxx Xxxx, XX 00000
S-5
BEAR XXXXXXX CORPORATE LENDING, INC, as a Lender
By: /S/ XXXXX XXXXXXX
-----------------
Name: Xxxxx Xxxxxxx
Title: Executive Vice President
Notice Address:
000 Xxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
ATTN: Xxxxxxx X'Xxxxx
S-6
COMMERCE BANK, N.A., as a Lender
By: /S/ XXXXX X. XXXXX
------------------
Name: Xxxxx X. Xxxxx
Title: Vice President
Notice Address:
0000 Xxxxx 00 Xxxx
Xxxxxx Xxxx, XX 00000
S-7
BANK LEUMI USA, as a Lender
By: /S/ XXXXXXX XXXXXX
------------------
Name: Xxxxxxx Xxxxxx
Title: Vice President
Notice Address:
Bank Leumi USA
Real Estate Department
000 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
ATTN: Xxxxxxx Xxxxxx
(000) 000-0000 - office
(000) 000-0000 - fax
With a copy to:
Xxxxxx Xxxxxxxx, Esq.
Xxxxxxx Xxxxxxxx Xxxxx Xxxxxxxxxxx & Kuh
000 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
(000) 000-0000 - fax
S-8
THE BANK OF NEW YORK, as a Lender
By: /S/ XXXXX X. FASAVIELLA
-----------------------
Name: Xxxxx X. Fasaviella
Title: Vice President
Notice Address:
The Bank of New York
000 Xxxxx Xxxx Xxxx
Xxxx Xxxxxxxx, XX 00000
ATTN: Xxxxx Fasaviella
(000) 000-0000 - office
(000) 000-0000 - fax
S-9
