Exhibit 99
FIRST AMENDMENT TO
LOAN AGREEMENT
This FIRST AMENDMENT TO AMENDED AND RESTATED LOAN AGREEMENT (this
"Agreement") is entered into and, unless otherwise stated herein, effective
as of July 29, 2005, by and among Xxxxxxxx Corporation, a Missouri
corporation ("Borrower"), LaSalle Bank National Association ("LaSalle"), as
Administrative Agent ("Administrative Agent"), and LaSalle and the other
lenders listed on the signature page hereto (the "Lenders").
RECITALS:
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A. Borrower, Administrative Agent and Lenders are party to that
certain Amended and Restated Loan Agreement dated as of January 27,
2005 (as amended, the "Original Loan Agreement").
B. Administrative Agent, Lenders and Borrower have agreed to the
provisions set forth herein on the terms and conditions contained
herein.
AGREEMENT
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Therefore, in consideration of the mutual agreements herein and
other sufficient consideration, the receipt of which is hereby acknowledged,
Borrower, Administrative Agent and the Lenders hereby agree as follows:
1. DEFINITIONS. All references to the "Agreement" or the "Loan Agreement" in
the Original Loan Agreement and in this Agreement shall be deemed to be
references to the Original Loan Agreement as it may be amended, restated,
extended, renewed, replaced, or otherwise modified from time to time.
Capitalized terms used and not otherwise defined herein have the meanings
given them in the Original Loan Agreement.
2. EFFECTIVENESS OF AGREEMENT. This Agreement shall become effective, unless
otherwise stated herein, as of the date first written above, but only if
this Agreement has been executed by Borrower, Administrative Agent and the
Lenders, and only if all of the documents listed on Exhibit A to this
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Agreement have been delivered and, as applicable, executed, sealed,
attested, acknowledged, certified, or authenticated, each in form and
substance satisfactory to Administrative Agent and the Lenders and all fees
and expenses required to be paid in connection herewith have been paid,
including, without limitation, the First Amendment Fee set forth on
Exhibit A attached hereto.
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3. LIFE INSURANCE CASH VALUE. Notwithstanding anything herein to the
contrary, Debtor does not grant nor intend to grant a Security Interest in
any of its interests in (including the cash value of) the Life Insurance
Policies.
4. INCREMENTS. Based on the last Compliance Certificate delivered, the
Eurodollar Revolving Margin, the Base Rate Revolving Margin, and Unused Fee
Rate, shall be reset to Level II effective the date of this Agreement.
5. AMENDMENTS. The Original Loan Agreement is amended as follows:
5.1. BASE RATE REVOLVING MARGINS AND EURODOLLAR REVOLVING MARGINS.
The chart in Section 4.6 of the Original Loan Agreement is deleted and
replaced with the following chart:
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IF THE RATIO OF BORROWER'S FUNDED
INDEBTEDNESS TO EBITDA (FOR THE FOUR BASE RATE
FISCAL QUARTER PERIOD OF BORROWER MOST EURODOLLAR REVOLVING UNUSED FEE
RECENTLY ENDED) IS REVOLVING MARGIN MARGIN RATE REFERENCE LEVEL
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greater than or equal to 3.50 to 1.00 2.750% 0.000% 0.375% IV
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greater than or equal to 3.00 to 1.00 2.500% 0.000% 0.375% III
but less than 3.50 to 1.00
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greater than or equal to 2.50 to 1.00 2.250% 0.000% 0.250% II
but less than 3.00 to 1.00
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less than 2.50 to 1.00 2.000% 0.000% 0.250% I
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5.2. INSURANCE/CONDEMNATION PROCEEDS. A new Section 6.4.3.4. is
added to Original Loan Agreement as follows:
"6.4.3.4. INSURANCE/CONDEMNATION PROCEEDS. All Insurance/
Condemnation Proceeds in excess of $250,000 in the aggregate
received by Borrower and all Covered Persons in any Fiscal year,
shall be deposited in an interest bearing account (the "Proceeds
Account") with Administrative Agent in the name of Borrower
promptly upon receipt thereof by Borrower or Administrative Agent.
Within 135 days after such receipt Borrower shall expend, or commit
to expend, some or all of the funds in the Proceeds Account for
rebuilding, repairing or replacing the property for which such
Insurance/Condemnation Proceeds were paid; provided, however, the
Borrower and the Administrative Agent may agree (such agreement not
to be unreasonably withheld by Administrative Agent, unless a
Default or Event of Default shall have occurred and is continuing,
in which case such consent may be withheld in the sole discretion
of the Administrative Agent) that the Borrower is not required to
rebuild, repair or replace and that such Insurance/Condemnation
Proceeds shall be applied to reduce the Loan Obligations as set
forth in this Agreement; and provided further, however, if any
Insurance/Condemnation Proceeds represent all or substantially all
of a site or location, then the Borrower shall not be required to
(but may in its reasonable business judgment) rebuild, repair or
replace such site or location and if Borrower decides in its
reasonable business judgment not to rebuild, repair or replace such
Insurance/Condemnation Proceeds shall be applied to reduce the Loan
Obligations as set forth in this Agreement. All funds in the
Proceeds Account that have not been so expended or committed to be
so expended by the 135th day after receipt shall be distributed by
Administrative Agent to Lenders to be applied in accordance with
this Section 6.4.3. The foregoing notwithstanding, Administrative
Agent shall have the right to debit the Proceeds Account in the
amount of, and apply the debit amount to pay, any of the Loan
Obligations that are not paid when due as provided herein or at any
time during an Existing Default. Borrower hereby assigns and grants
to Administrative Agent for the benefit of Lenders a first priority
Security Interest in any such Proceeds Account as security for
payment and performance of the Loan Obligations. Notwithstanding
the foregoing provisions of this Section, but subject to the
$250,000 threshold in the first sentence of this Section, any
Insurance/Condemnation Proceeds representing or applicable to a
leasehold location shall be applied to the Loan Obligations as set
forth herein. Administrative Agent is hereby authorized to
participate in any proceeding for the condemnation or other taking
of any of Borrower's property and Borrower from time to time will
deliver to
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Administrative Agent all instruments reasonably requested by
Administrative Agent to permit such participation."
5.3. COMPELLED RETURN OF PAYMENTS OR PROCEEDS. The first sentence
of Section 6.8 of the Original Loan Agreement is deleted and replaced with
the following:
"If Administrative Agent or any Lender is for any reason compelled
to surrender any payment or any proceeds of the Collateral because
such payment or the application of such proceeds is for any reason
invalidated, declared fraudulent, set aside, or determined to be
void or voidable as a preference, an impermissible setoff, or a
diversion of trust funds, then this Agreement and the Loan
Obligations to which such payment or proceeds was applied or
intended to be applied shall be revived as if such application was
never made; and Borrower shall be liable to pay to Administrative
Agent or such Lender, and shall indemnify Administrative Agent or
such Lender for and hold Administrative Agent or such Lender
harmless from any loss with respect to, the amount of such payment
or proceeds surrendered."
5.4. CONDITIONS TO EACH ADVANCE. A new Section 7.13 is added to the
Original Loan Agreement as follows
"7.13 PAYMENTS TO OTHER CREDITORS. If Administrative Agent becomes
obligated to reimburse or pay to any creditor of Borrower any
amount in order to (i) obtain a release of such creditor's Security
Interest in any of the Collateral, or (ii) otherwise satisfy an
Obligation of Borrower to such creditor to the extent not
indefeasibly satisfied by the initial Advances, then Administrative
Agent shall have the right to make Revolving Loan Advances for that
purpose. Administrative Agent may select the Advance Date for any
such Advance, but such Advance Date may only be a Business Day.
Administrative Agent will give notice to Borrower after any such
Revolving Loan Advance is made. Any such Revolving Loan Advance
initially will be a Base Rate Advance."
5.5. CONDITIONS TO EACH ADVANCE. A new Section 8.2.5. is added to
the Original Loan Agreement as follows:
"8.2.5. PERFECTION OF SECURITY INTERESTS. Every Security Interest
required to be granted by Borrower to Administrative Agent under
this Agreement and the Loan Documents shall have been perfected and
shall be, except as otherwise satisfactory to Lenders, a first
priority Security Interest."
5.6. CONDITIONS TO ISSUANCE OF LETTERS OF CREDIT. A new Section
9.6. is added to the Original Loan Agreement as follows:
"9.6. PERFECTION OF SECURITY INTERESTS. Every Security Interest
required to be granted by Borrower to Administrative Agent under
this Agreement and the Loan Documents shall have been perfected and
shall be, except as otherwise satisfactory to Lenders, a first
priority Security Interest."
5.7. COMPLIANCE WITH LAWS. The following are added to Section 10.10
of the Original Loan Agreement:
"10.10.1. INVESTIGATIONS REGARDING HAZARDOUS MATERIALS. None of the
operations of any Covered Person are, or in the past six years have
been, the subject of investigation by any
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Governmental Authority regarding the improper transportation, storage,
disposal, generation or release into the environment of any Hazardous
Material, the results of which have or are reasonably likely to
have a Material Adverse Effect on such Covered Person, or reduce
materially the value of the Collateral.
10.10.2. NOTICES AND REPORTS REGARDING HAZARDOUS MATERIALS. No
notice or report under any Environmental Law indicating a past or
present spill or release into the environment of any Hazardous
Material has been, or is required to be filed, by any Covered
Person.
10.10.3. HAZARDOUS MATERIALS ON REAL PROPERTY. No Covered Person
has at any time transported, stored, disposed of, generated or
released any Hazardous Material on the surface, below the surface,
or within the boundaries of any real property owned or operated by
such Covered Person or any improvements thereon which could
reasonably be likely to have a Material Adverse Effect. Borrower
has no knowledge of any Hazardous Material on the surface, below
the surface, or within the boundaries of the any real property
owned or operated by any Covered Person or any improvements thereon
which could reasonably be likely to have a Material Adverse Effect.
No property of any Covered Person is subject to a Security Interest
in favor of any Governmental Authority for any liability under any
Environmental Law or damages arising from or costs incurred by such
Governmental Authority in response to a spill or release of
Hazardous Material into the environment."
5.8. SUBSIDIARIES. Section 10.26 of the Original Loan Agreement is
deleted and replaced with the following:
"10.26. AFFILIATES; SUBSIDIARIES. Borrower has no Subsidiaries
(direct or indirect), except for those Subsidiaries listed in
section 10.26 of the Disclosure Schedule (which lists all
Guarantors and all Dormant Subsidiaries), which may be updated by
Borrower from time to time without the consent of Required Lenders
so long as any such new Subsidiary executes a joinder agreement to
the Guaranty if required by the Administrative Agent in its
reasonable discretion. None of the Dormant Subsidiaries holds any
assets of any kind or nature other than the equity of any other
Dormant Subsidiary, or has or will incur any liabilities,
obligations or Indebtedness of any kind other than incidental
corporate maintenance items and incidental franchise tax
liabilities related its corporate existence and other than
liabilities of the Dormant Subsidiaries under leases assigned to
Healthcare Uniform Company, Inc. and for which Healthcare Uniform
Company, Inc. is primarily liable. Other than the Subsidiaries who
are Guarantors and other than the Dormant Subsidiaries, Borrower
has no Subsidiaries (direct or indirect). Except as provided above,
none of the Dormant Subsidiaries has any existing Indirect
Obligation or Indebtedness."
5.9. REPRESENTATIONS REGARDING ASSETS. The following new Sections
10.34, 10.35, 10.36, and 10.37 are added to the Original Loan Agreement:
"10.34. REAL PROPERTY. Section 10.34 of the Disclosure Schedule
contains a correct and complete list of (i) the street addresses
and a general description of all real property owned by each
Covered Person other than the Dormant Subsidiaries, and (ii) a list
of all leases and subleases of real property by each Covered
Person, with respect to such Covered Person identified for each as
the lessee, sublessee, lessor, or sublessor, as is the case,
together with the street addresses and a general description of the
real property involved and the names of the other parties to such
leases and subleases. Each of such leases and subleases is valid
and
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enforceable in accordance with its terms and is in full force
and effect, and no default by any party to any such lease or
sublease exists.
10.35. STATE OF COLLATERAL AND OTHER PROPERTY. Each Covered Person
has good and marketable or merchantable title to all real and
personal property purported to be owned by it or reflected in the
Financial Statements, except for personal property sold in the
ordinary course of business after the date of such Financial
Statements or personal property subject to Capital Leases. There
are no Security Interests on any of the property purported to be
owned by any Covered Person, including the Collateral, except
existing Permitted Security Interests. Each tangible item of
Personal Property Collateral purported to be owned by a Covered
Person is in good operating condition and repair and is suitable
for the use to which it is customarily put by its owner. Without
limiting the generality of the foregoing:
10.35.1. ACCOUNTS. With respect to each Account scheduled,
listed or referred to in reports submitted by any Covered
Person to Administrative Agent pursuant to the Loan
Documents, except as disclosed therein: (i) the Account
arose from a bona fide transaction completed in accordance
with the terms of any documents pertaining to such
transaction; (ii) the Account is not evidenced by a
judgment and there is no material dispute respecting it;
(iii) the amount of the Account as shown on the applicable
Covered Person's books and records and all invoices and
statements which may be delivered to Administrative Agent
with respect thereto are actually and absolutely owing to
the applicable Covered Person and are not in any way
contingent; (iv) there are no setoffs, counterclaims or
disputes existing or asserted with respect to the Account
and the applicable Covered Person has not made any
agreement with any Account Debtor for any deduction
therefrom except a discount or allowance allowed by the
applicable Covered Person in the ordinary course of its
business for prompt payment; (v) Borrower has no knowledge
of any facts, events or occurrences which in any way
impair the validity or enforcement of the Account or tend
to reduce the amount payable thereunder as shown on the
applicable Covered Person's books and records and all
invoices and statements delivered to Administrative Agent
with respect thereto; (vi) the Account is assignable;
(vii) the Account arose in the ordinary course of the
applicable Covered Person's business; (viii) the Account
Debtor with respect to the Account has the capacity to
contract; (ix) the services furnished and/or goods sold
giving rise to the Account are not subject to any Security
Interest except the first priority, perfected Security
Interest granted to Administrative Agent for the benefit
of Lenders and except the Permitted Security Interests;
and (x) there are no proceedings or actions which are
threatened or pending against the Account Debtor with
respect to the Account.
10.35.2. INVENTORY. With respect to Inventory scheduled,
listed or referred to in any certificate, schedule, list
or report given by any Covered Person, except as disclosed
therein: (i) such Inventory (except for Inventory in
transit and except as permitted by Section 13.18) is
located at one or another of the premises listed in
section 10.35.2 of the Disclosure Schedule; (ii) the
applicable Covered Person has good and merchantable title
to such Inventory subject to no Security Interest
whatsoever except for the first priority, perfected
Security Interest granted to Administrative Agent for the
benefit of Lenders and except for existing Permitted
Security Interests; (iii) such Inventory is of good and
merchantable quality, free from any material defects; (iv)
such Inventory is not subject to any licensing, patent,
royalty, trademark, trade name or copyright agreements
with any third parties; and (v) the completion of
manufacture and sale or other disposition of such
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Inventory by Administrative Agent or Lenders following an
Event of Default shall not require the consent of any
Person and shall not constitute a breach or default under
any contract or agreement to which any Covered Person is a
party or to which the Inventory is subject.
10.35.3. EQUIPMENT. With respect to each Covered Person's
equipment: (i) such Covered Person has good and marketable
title thereto; (ii) none of such equipment is subject to
any Security Interests except for the first priority,
perfected Security Interest granted to Administrative
Agent for the benefit of Lenders pursuant hereto and
except for Permitted Security Interests; and (iii) all
such equipment is in good operating condition and repair,
ordinary wear and tear alone excepted, and is suitable for
the uses to which customarily put in the conduct of such
Covered Person's business. No equipment used in the
conduct of such Covered Person's business is leased,
except for non-material items of office equipment,
computer equipment and vehicles.
10.35.4. INTELLECTUAL PROPERTY. With respect to the
Intellectual Property of the Covered Persons: (i) section
10.35.4 of the Disclosure Schedule contains a complete and
correct list of all of each Covered Person's Intellectual
Property, (ii) the Covered Person listed on the Disclosure
Schedule as the owner thereof owns all right, title and
interest in, under and to such Intellectual Property,
subject to no licenses or any interest therein or other
agreements relating thereto, except for the Security
Agreement; (iii) none of such Intellectual Property is
subject to any pending or, to such Covered Person's
knowledge, threatened challenge which could reasonably be
likely to have a Material Adverse Effect; (iv) such
Covered Person has not committed any patent, trademark,
trade name, service xxxx or copyright infringement, and
the present conduct of such Covered Person's business does
not infringe any patents, trademarks, trade name rights,
service marks, copyrights, publication rights, trade
secrets or other proprietary rights of any Person which
could reasonably be likely to have a Material Adverse
Effect; and (v) there are no claims or demands of any
Person pertaining to, or any proceedings which are pending
or, to the knowledge of such Covered Person, threatened,
which challenge such Covered Person's rights in respect of
any proprietary or confidential information or trade
secrets used in the conduct of such Covered Person's
business which could reasonably be likely to have a
Material Adverse Effect.
10.35.5. DOCUMENTS, INSTRUMENTS AND CHATTEL PAPER. All
documents, instruments and chattel paper describing,
evidencing or constituting Collateral, and all signatures
and endorsements thereon, are complete, valid, and
genuine, and all goods evidenced by such documents,
instruments and chattel paper are owned by a Covered
Person free and clear of all Security Interests other than
Permitted Security Interests.
10.36. CHIEF PLACE OF BUSINESS; LOCATIONS OF COLLATERAL.
10.36.1. The only chief executive office and the principal
places of business of each Covered Person are located at
the places listed and so identified in section 10.36.1 of
the Disclosure Schedule;
10.36.2. The books and records of each Covered Person, and
all of such Covered Person's chattel paper and all records
of Accounts, are located only at the places listed and so
identified in section 10.36.2 of the Disclosure Schedule;
and
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10.36.3. All of the Collateral (except for Inventory which
is in transit and real property and as permitted by
Section 13.18 of this Agreement) is located only at the
places listed and so identified in section 10.36.3 of the
Disclosure Schedule; no Covered Person has an office or
place of business other than as identified in section
10.36.3 of the Disclosure Schedule.
10.37. SECURITY DOCUMENTS. Each Security Agreement is effective to
grant to Administrative Agent for the benefit of Lenders an
enforceable Security Interest in the Personal Property Collateral
described therein. Upon appropriate filing (as to all Personal
Property Collateral in which a Security Interest may be perfected
under the applicable state's UCC by filing a financing statement)
or Administrative Agent's taking possession (as to items of the
Personal Property Collateral of which a secured party must take
possession in order to perfect a Security Interest under the
applicable state's UCC), Administrative Agent will have a fully
perfected first priority Security Interest in the Personal Property
Collateral described in each Security Agreement, subject only to
Permitted Security Interests affecting such Personal Property
Collateral.
5.10. MAINTENANCE OF PROPERTY. The following is added to the end of
Section 12.3 of the Original Loan Agreement:
"No Covered Person shall permit any of its equipment or other
property to become a fixture to any real property not owned by any
Covered Person."
5.11. INSURANCE. Section 12.4 of the Original Loan Agreement is
deleted and replaced with the following:
"12.4. INSURANCE. Each Covered Person shall at all times keep
insured or cause to be kept insured, in insurance companies having
a rating of at least "A-" by Best's Rating Service, all property
owned by it of a character usually insured by others carrying on
businesses similar to that of such Covered Person in such manner
and to such extent and covering such risks as such properties are
usually insured subject to deductibles and self-insured retention
levels consistent with past practices. Each Covered Person also
shall carry business interruption insurance in such amounts, in
such manner and to such extent and covering such risks as such
businesses are usually insured subject to deductibles and
self-insured retention levels consistent with past practices. Each
Covered Person shall at all times carry insurance, in insurance
companies having a rating of at least "A-" by Best's Rating
Service, against liability on account of damage to persons or
property (including product liability insurance and insurance
required under all Laws pertaining to workers' compensation) and
covering all other liabilities common to such Covered Person's
business, in such manner and to such extent as such coverage is
usually carried by others conducting businesses similar to that of
such Covered Person subject to deductibles and self-insured
retention levels consistent with past practices. All liability
policies of insurance maintained hereunder shall name
Administrative Agent as an additional insured for the benefit of
Lenders; all policies of property insurance maintained hereunder
shall reflect Administrative Agent's interest therein as a
mortgagee for the benefit of the Lenders under a standard New York
or Union mortgagee clause. Administrative Agent is authorized, but
not obligated, as the attorney-in-fact for Borrower and for the
benefit of Lenders, (i) prior to the occurrence of an Event of
Default, with Borrower's consent (which consent shall not be
unreasonably withheld), and upon the occurrence of an Event of
Default, without Borrower's consent, to adjust and compromise
proceeds payable under such policies of insurance, (ii) prior to
the occurrence of an
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Event of Default, with Borrower's consent (which consent shall not
be unreasonably withheld), and upon the occurrence of an Event of
Default, without Borrower's consent, to collect, receive and give
receipts for such proceeds in the name of Borrower, Administrative
Agent and Lenders, and (iii) prior to the occurrence of an Event of
Default, with Borrower's consent (which consent shall not be
unreasonably withheld), and upon the occurrence of an Event of
Default, without Borrower's consent, to endorse Borrower's name
upon any instrument in payment thereof. Such power granted to
Administrative Agent shall be deemed coupled with an interest and
shall be irrevocable. All such policies of insurance maintained
hereunder shall contain a clause providing that such policies may
not be canceled, without 30 days prior written notice to
Administrative Agent. Borrower shall upon request of Administrative
Agent at any time furnish to Administrative Agent updated evidence
of insurance (in the form required as a condition to Administrative
Agent's lending hereunder) for such insurance. Notwithstanding the
foregoing, if the Best's Rating Service rating of any insurance
carrier(s) of the Borrower or any other Covered Person falls below
"A-," then such event shall not be an Event of Default if, within
270 days of such downgrading, Borrower shall put in place insurance
meeting the requirements of this Section with replacement insurance
carrier(s) with a Best's Rating Service rating of at least `A-.'"
5.12. NOTICE TO ADMINISTRATIVE AGENT OF MATERIAL EVENTS. A new
Section 12.8.10 is added to the Original Loan Agreement as follows:
"12.8.10 Borrower shall notify Administrative Agent promptly in
writing of any fact or condition of which Borrower is aware which
materially adversely affects the value of the Collateral taken as a
whole, or any adverse fact or condition or the occurrence of any
event which causes loss or depreciation in the value of any
material item of the Collateral other than ordinary, depreciation,
wear and tear, and the amount of such loss or depreciation.
Borrower shall provide such additional information to
Administrative Agent regarding the amount of any loss or
depreciation in value of the Collateral as Administrative Agent may
request from time to time. Borrower shall also provide other
reports and information, in form and detail satisfactory to
Administrative Agent, and documents as Administrative Agent may
reasonably request from time to time concerning the Collateral.
5.13. MAINTENANCE OF SECURITY INTERESTS. A new Section 12.21 is
added to the Original Loan Agreement as follow:
"12.21. MAINTENANCE OF SECURITY INTERESTS OF SECURITY DOCUMENTS.
12.21.1 PRESERVATION AND PERFECTION OF SECURITY INTERESTS.
Borrower shall promptly, upon the reasonable request of
Administrative Agent and at Borrower's expense, execute,
acknowledge and deliver, or cause the execution,
acknowledgment and delivery of, and thereafter file or
record in the appropriate governmental office, any
document or instrument supplementing or confirming the
Security Documents or otherwise deemed necessary by
Administrative Agent to create, preserve or perfect any
Security Interest purported to be created by the Security
Documents or to fully consummate the transactions
contemplated by the Loan Documents including, without
limitation, providing collateral necessary to meet the
Minimum Asset Coverage Ratio. The foregoing actions by
Borrower shall include (i) filing financing or
continuation statements, and amendments thereof, in form
and substance satisfactory to Administrative Agent; (ii)
delivering to Administrative Agent the originals of all
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instruments, documents and chattel paper, and all other
Collateral of which Administrative Agent determines it
should have physical possession in order to perfect and
protect Administrative Agent's Security Interest for the
benefit of Lenders therein, duly endorsed or assigned to
Administrative Agent without restriction; (iii) delivering
to Administrative Agent warehouse receipts covering any
portion of the Collateral located in warehouses and for
which warehouse receipts are issued; (iv) transferring
Inventory to warehouses designated by Administrative
Agent; (v) delivering to Administrative Agent all letters
of credit on which Borrower is named beneficiary; (vi)
placing a durable notice of the existence of
Administrative Agent's Security Interest for the benefit
of Lenders, acceptable to Administrative Agent, upon such
items of the Collateral as are designated by
Administrative Agent; and (vii) placing a notice of the
existence of Administrative Agent's Security Interest for
the benefit of Lenders, acceptable to Administrative
Agent, upon those writings evidencing the Collateral and
the books and records of Borrower pertaining to the
Collateral, as designated by Administrative Agent.
12.21.2. COLLATERAL HELD BY WAREHOUSEMAN, BAILEE, ETC.
Subject to Section 13.18, if any Collateral is at any time
in the possession or control of a warehouseman, bailee or
any of Borrower's or any Covered Person's agents or
processors, then Borrower shall notify Administrative
Agent thereof and shall notify such Person of
Administrative Agent's Security Interest for the benefit
of Lenders in such Collateral and, upon Administrative
Agent's request, instruct such Person to hold all such
Collateral for Administrative Agent's account subject to
Administrative Agent's instructions. Subject to Section
13.18, if at any time any Collateral is located on any
premises that are not owned by a Covered Person, then
Borrower shall obtain or cause to be obtained written
waivers, in form and substance satisfactory to
Administrative Agent, of all present and future Security
Interests to which the owner or lessor or any mortgagee of
such premises may be entitled to assert against the
Collateral.
12.21.3. COMPLIANCE WITH TERMS OF SECURITY DOCUMENTS. Each
Covered Person shall comply with all of the terms,
conditions and covenants in the Security Documents to
which such Covered Person is a party."
5.14. APPRAISALS OF COLLATERAL. A new Section 12.22 is added to the
Original Loan Agreement as follow:
"12.22. APPRAISALS OF COLLATERAL. Upon Administrative Agent's
request at any time if there is an Existing Default, Borrower shall
promptly reimburse Administrative Agent for the cost of any
appraisals of the Collateral as Administrative Agent may specify,
prepared on a basis satisfactory to Administrative Agent and from
appraisers chosen by and acceptable to Administrative Agent."
5.15. REVIEW OF ACCOUNTS AND INVENTORY. A new Section 12.23 is
added to the Original Loan Agreement as follow:
"12.23. REVIEW OF ACCOUNTS AND INVENTORY. Not less often than
annually, and promptly at Administrative Agent's reasonable request
if there is an Existing Default, Borrower shall conduct (and shall
cause each other Covered Person to conduct) a review of its
Accounts, bad debt reserves, and collection histories of Account
Debtors and promptly following such review provide Administrative
Agent with a report of such review in form and detail satisfactory
to Administrative Agent."
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5.16. EXAMS BY ADMINISTRATIVE AGENT. A new Section 12.24 is added
to the Original Loan Agreement as follow:
"12.24. EXAMS BY ADMINISTRATIVE AGENT. Administrative Agent or
Persons authorized by and acting on behalf of Administrative Agent
may at any time during normal business hours examine the books and
records and inspect any of the property of each Covered Person from
time to time upon reasonable notice to such Covered Person, and in
the course thereof may make copies or abstracts of such books and
records and discuss the affairs, finances and books and records of
such Covered Person with its accountants, independent auditors (and
the Borrower hereby authorizes such independent auditors to discuss
such financial matters with Administrative Agent or any
representative thereof), officers and employees. Each Covered
Person shall cooperate with Administrative Agent and such Persons
in the conduct of such examinations and shall deliver to
Administrative Agent any instrument necessary for Administrative
Agent to obtain records from any service bureau maintaining records
for such Covered Person. Borrower shall reimburse Administrative
Agent for all reasonable costs and expenses incurred by it in
conducting each examination. Notwithstanding the foregoing, in the
absence of an Existing Default, Administrative Agent shall be
limited to one such reimbursed exam per fiscal year.
5.17. BANK ACCOUNTS. A new Section 12.25 is added to the Original
Loan Agreement as follows:
"12.25. LOCKBOX. Any lockboxes opened or created by Borrower or any
Subsidiary after the First Amendment Date shall be opened and
maintained at one or more of the Lenders."
5.18. SECURITY INTERESTS. Section 13.4 of the Original Loan
Agreement is amended by adding a new Section 13.4.8 and deleting the last
sentence of Section 13.4 with a new sentence, all as follows:
"13.4.8. Security Interests in favor of the Administrative Agent to
secure the Loan Obligations.
At no time shall Borrower or any Covered Person allow to exist on
or against its assets any financing statements, mortgages or
similar documents, except as permitted in Section 13.4.5 and
13.4.8."
5.19. ACQUISITIONS. Section 13.5 of the Original Loan Agreement is
deleted and replaced with the following:
"13.5. ACQUISITIONS. Acquire stock, membership interests, or any
other equity interest in a Person, or acquire all or substantially
all of the assets of a Person (including without limitation assets
comprising all or substantially all of an unincorporated business
unit or division of any Person), except with the prior written
approval of the Required Lenders, provided, however, no such
consent shall be needed for all acquisitions up to an aggregate of
$3,000,000 during the term of this Agreement."
5.20. BAILMENTS, CONSIGNMENTS AND WAREHOUSING. A new Section 13.18
is add to the Original Loan Agreement as follows:
"13.18. BAILMENTS; CONSIGNMENTS; WAREHOUSING. No later than August
31, 2005 (unless Administrative Agent in its sole discretion agrees
in writing to a later date), other than ordinary course of business
storage at customers of no more than thirty (30) consecutive days
for any item
10
of Inventory, store any Inventory or other assets in excess of
$250,000 in the aggregate with a bailee, warehouseman, consignee or
pursuant to an express or implied agreement establishing a bailment
or consignment of Inventory or similar arrangement, unless
Administrative Agent has received a written acknowledgment
satisfactory to Administrative Agent from the third party involved
which acknowledges the prior perfected Security Interest of
Administrative Agent for the benefit of Lenders in such Inventory."
5.21. NEW SUBSIDIARIES. A new Section 13.19 is add to the Original
Loan Agreement as follows:
"13.19. SUBSIDIARIES. Organize, create or acquire any Subsidiary
unless it is part of a Permitted Acquisition or Borrower has
obtained the prior written consent of Administrative Agent thereto
(which consent shall not be unreasonably withheld) and
contemporaneously with the organization, creation or acquisition of
such Subsidiary, the applicable Covered Person and such Subsidiary
executes and delivers to Administrative Agent for the benefit of
Lenders the following additional documents: an unlimited guaranty
of the Loan Obligations by such Subsidiary, a pledge of the capital
stock or membership interests of such Covered Person in such
Subsidiary, and other Security Documents requested by
Administrative Agent so as to grant Administrative Agent, for the
benefit of the Lenders, a perfected, first priority security
interest in all real and personal property of such Subsidiary."
5.22. DORMANT SUBSIDIARIES. A new Section 13.20 is add to the
Original Loan Agreement as follows:
"13.20. DORMANT SUBSIDIARIES. Allow or permit any Dormant
Subsidiary to, and no Dormant Subsidiary shall (i) have or hold any
assets of any kind or nature other than the equity interests of any
other Dormant Subsidiary, and (ii) have or incur any liabilities,
obligations or Indebtedness of any kind other than incidental
corporate maintenance items and incidental franchise tax
liabilities related its corporate existence and other than
liabilities under leases assigned to Healthcare Uniform Company,
Inc. and for which Healthcare Uniform Company, Inc. is primarily
liable. Allow or permit any transfer of any assets or liabilities
to any Dormant Subsidiary."
5.23. FUNDED INDEBTEDNESS. The definition of Funded Indebtedness in
Section 14.1 is deleted in its entirety and replaced with the following:
"Funded Indebtedness means the result of (i) outstanding principal
balance of the Loan Obligations and other Indebtedness for borrowed
money, plus (ii) the Letter of Credit Exposure, plus (iii) the
initial capitalized cost of assets subject to Capital Leases at the
time of calculation, less (iv) if there is no Indebtedness
outstanding as permitted by Section 13.2.7 of this Agreement, cash
in excess of $500,000, as shown on the balance sheet for the most
recent fiscal quarter ended. The foregoing shall exclude the
outstanding principal amount of the Indebtedness permitted by
Section 13.2.7 of this Agreement."
5.24. MAXIMUM RATIO OF FUNDED INDEBTEDNESS TO EBITDA. For all
reporting periods after the First Amendment Date, Section 14.3 of the
Original Loan Agreement is deleted and replaced with the following:
11
"14.3 MAXIMUM RATIO OF FUNDED INDEBTEDNESS TO EBITDA. Borrower
shall cause the ratio of Funded Indebtedness to EBITDA for the most
recently ended four fiscal quarters, for the fiscal quarters ended
on the dates specified below, calculated as of the last day of each
such fiscal quarter, to not be greater than the ratio specified for
such period:
==============================================================================================
FOUR FISCAL QUARTER PERIOD ENDED ON OR MAXIMUM RATIO OF FUNDED INDEBTEDNESS TO
MOST RECENTLY BEFORE THE FOLLOWING DATES: EBITDA
----------------------------------------------------------------------------------------------
July 31, 2005, October 31, 2005, January 31, 4.00:1.00
2006, April 30, 2006, and each July 31,
October 31, January 31, and April 30
thereafter
----------------------------------------------------------------------------------------------
Provided, however, and notwithstanding the foregoing, if the Real
Estate Closing does not occur on or before October 28, 2005, then
for the fiscal quarter ending on October 29, 2005 and for all
reporting periods thereafter, Borrower shall cause the ratio of
Funded Indebtedness to EBITDA for the most recently ended four
fiscal quarters, for the fiscal quarters ended on the dates
specified below, calculated as of the last day of each such fiscal
quarter, to not be greater than the ratio specified for such
period:
==============================================================================================
FOUR FISCAL QUARTER PERIOD ENDED ON OR MAXIMUM RATIO OF FUNDED INDEBTEDNESS TO
MOST RECENTLY BEFORE THE FOLLOWING DATES: EBITDA
----------------------------------------------------------------------------------------------
October 31, 2005, January 31, 2006, April 2.75:1.00
30, 2006, July 31, 2006, and each
October 31, January 31, April 30 and July 31
thereafter
----------------------------------------------------------------------------------------------
5.25. GUARANTORS. The following is added to the end of Section
15.1.15 of the Original Loan Agreement as follows:
"Failure of any Subsidiary of Borrower (other than the Dormant
Subsidiaries) to have guarantied all of the Loan Obligations, or
the failure of any Subsidiary of Borrower (other than the Dormant
Subsidiaries) to have granted a lien and Security Interest on all
of its personal property and such of its real property as is
required by Administrative Agent in favor of Administrative Agent."
5.26. LOAN DOCUMENTS; SECURITY INTERESTS. A new Section 15.1.16 is
added to the Original Loan Agreement as follows:
"15.1.16. LOAN DOCUMENTS; SECURITY INTERESTS. For any reason other
than the failure of Administrative Agent to take any action
available to it to maintain perfection of the Security Interests
created in favor of Administrative Agent for the benefit of Lenders
pursuant to the Loan Documents, any Loan Document ceases to be in
full force and effect or any Security Interest with respect to any
portion of the Collateral intended to be secured thereby ceases to
be, or is not, valid, perfected and prior to all other Security
Interests (other than the Permitted Security Interests) or is
terminated, revoked or declared void or invalid."
5.27. LOSS TO COLLATERAL. A new Section 15.1.17 is added to the
Original Loan Agreement as follows:
12
"15.1.17. LOSS TO COLLATERAL. Any loss, theft, damage or
destruction of any item or items of Collateral occurs which either
(i) has or is reasonably likely to have a Material Adverse Effect
on any other Covered Person or (ii) materially and adversely
affects the operation of Borrower's and the Covered Person's
business and is not covered by insurance as required herein."
5.28. REAL ESTATE CLOSING. A new Section 15.1.18 is added to the
Original Loan Agreement as follows:
"15.1.18. Real Estate Closing. The Real Estate Closing does not
occur on or before October 28, 2005."
5.29. RIGHTS AND REMEDIES. Section 15.3.3 of the Original Loan
Agreement is deleted and replaced with the following:
"15.3.3. RIGHT OF SETOFF. Upon the occurrence and during the
continuation of an Event of Default, each Lender is hereby
authorized, without notice to Borrower or any other Covered Person
(any such notice being expressly waived by Borrower and each other
Covered Person), to the fullest extent permitted by law, to set off
and apply against the Loan Obligations or Guarantied Obligations
(used as such term is defined in each of the Guaranties) any and
all deposits (general or special, time or demand, provisional or
final) at any time held, or any other Indebtedness at any time
owing by such Lender (or its Affiliate) to or for the credit or the
account of Borrower or such other Covered Person, irrespective of
whether or not such Lender shall have made any demand under this
Agreement or the Notes or any Guaranty and although such Loan
Obligations or Guarantied Obligations may be unmatured. The rights
of each Lender under this Section are in addition to other rights
and remedies (including, without limitation, other rights of
setoff) which such Lender may otherwise have. All amounts received
by each Lender on account of the Loan Obligations or Guarantied
Obligations pursuant to this Section shall be paid over promptly to
Administrative Agent for distribution to Lenders as provided in
this Agreement and shall be applied as provided in this Agreement."
5.30. RIGHTS AND REMEDIES. The following is added to Section 15.3
of the Original Loan Agreement as follows:
"15.3.6. NOTICE TO ACCOUNT DEBTORS. Upon the occurrence and during
the continuance of any Event of Default, Administrative Agent may
or if the Required Lenders direct, without prior notice to
Borrower, notify any or all Account Debtors that the Accounts have
been assigned to Administrative Agent for the benefit of Lenders
and that Administrative Agent has a Security Interest therein for
the benefit of Lenders, and Administrative Agent may direct, or
Borrower, at Administrative Agent's request, shall direct and cause
each Covered Person, any or all Account Debtors to make all
payments upon the Accounts directly to Administrative Agent for the
benefit of Lenders.
15.3.7. ENTRY UPON PREMISES AND ACCESS TO INFORMATION. Upon the
occurrence and during the continuance of any Event of Default, and
at any time thereafter: Administrative Agent may (i) enter upon the
premises leased or owned by Borrower or any other Covered Person
where Collateral is located (or is believed to be located) without
any obligation to pay rent to Borrower or any other Covered Person,
or any other place or places where Collateral is believed to be
located, (ii) render Collateral usable or saleable, (iii) remove
Collateral therefrom to the premises of Administrative Agent or any
agent of Administrative Agent for such time as Administrative Agent
may desire in order effectively to collect or liquidate Collateral,
(iv) take possession of,
13
and make copies and abstracts of, Borrower's and each Covered
Person's original books and records, obtain access to Borrower's
and each other Covered Person's data processing equipment, computer
hardware and software relating to any of the Collateral and use all
of the foregoing and the information contained therein in any
manner Administrative Agent deems appropriate in connection with
the exercise of Administrative Agent's rights, and (v) notify
postal authorities to change the address for delivery of Borrower's
and each Covered Person's mail to an address designated by
Administrative Agent and to receive, open and process all mail
addressed to Borrower and each Covered Person.
15.3.8. COMPLETION OF UNCOMPLETED INVENTORY ITEMS. Upon the
occurrence and during the continuance of any Event of Default,
Administrative Agent may request that Borrower, and Borrower shall
and shall cause each other Covered Person upon such request, to use
its best efforts to obtain the consent of its and any other Covered
Person's customers to the completion (before or after foreclosure
by Administrative Agent of its security interest therein) of the
manufacture of all uncompleted Inventory items that Borrower or any
other Covered Person was manufacturing for such customers pursuant
to contracts or accepted purchase orders, and the commitment by
such customers to purchase such items upon their completion as
provided in the relevant contracts or accepted purchase orders.
Borrower and each other Covered Person shall, as an uncompensated
agent for Lenders, complete or cause to be completed the
manufacture and shipment of all such items as provided in the
relevant contracts or accepted purchase orders if Administrative
Agent so directs.
15.3.9. BORROWER'S OBLIGATIONS. Upon the occurrence and during the
continuance of any Event of Default, Borrower shall and shall cause
each other Covered Person to, if Administrative Agent so requests,
assemble all the movable tangible Collateral and make it available
to Administrative Agent at a place or places to be designated by
Administrative Agent in its discretion.
15.3.10. MISCELLANEOUS. Upon the occurrence and during the
continuance of any Event of Default, Administrative Agent and/or
the Lenders may exercise any other rights and remedies available to
Administrative Agent and/or the Lenders under the Loan Documents or
otherwise available to Administrative Agent and/or the Lenders at
law or in equity.
15.3.11. SECURED PARTY RIGHTS. Upon the occurrence and during the
continuance of any Event of Default:
15.3.11.1. Administrative Agent and/or the Lenders may exercise any
or all of its rights under the Security Documents as a secured
party under the UCC and any other applicable Law; and
15.3.11.2. Administrative Agent may sell or otherwise dispose of
any or all of the Collateral at public or private sale in a
commercially reasonable manner, which sale Administrative Agent may
postpone from time to time by announcement at the time and place of
sale stated in the notice of sale or by announcement at any
adjourned sale without being required to give a new notice of sale,
all as Administrative Agent deems advisable, for cash or credit.
Administrative Agent or any Lender may become the purchaser at any
such sale if permissible under applicable Law, and Administrative
Agent or such Lender may, in lieu of actual payment of the purchase
price, setoff the amount thereof against Borrower's obligations
owing to Administrative Agent or Lender, and Borrower agrees that
Administrative Agent or such Lender has no obligation to preserve
rights to Collateral against prior parties or to marshal any
Collateral for the benefit of any Person.
14
In connection with the advertising for sale, further manufacture,
selling, or otherwise realizing upon any of the Collateral, to the
extent Administrative Agent has not foreclosed upon its Security
Interest in the following, Administrative Agent may use and is
hereby granted a license to use, without charge or liability to
Administrative Agent or Lenders therefor, any of Borrower's or any
other Covered Person's labels, trade names, trademarks, trade
secrets, service marks, patents, patent applications, licenses,
certificates of authority, advertising materials, or any of
Borrower's or any other Covered Person's other properties or
interests in properties of similar nature, to the extent that such
use thereof is not prohibited by agreements under which Borrower or
such other Covered Person has rights therein, and all of Borrower's
and each other Covered Person's rights under license, franchise and
similar agreements shall inure to Lenders' benefit."
5.31. APPLICATION OF FUNDS.
Section 15.4 to the Original Loan Agreement is deleted and replaced with the
following:
"15.4. APPLICATION OF FUNDS. Any funds received by Lenders or
Administrative Agent for the benefit of Lenders with respect to any
Loan Obligation after its Maturity, including proceeds of
Collateral, shall be applied as follows: (i) first, to reimburse
Lenders pro-rata for any amounts due to Lenders under Section 18.8;
(ii) second, to reimburse to Administrative Agent all unreimbursed
costs and expenses paid or incurred by Administrative Agent that
are payable or reimbursable by Borrower hereunder; (iii) third, to
reimburse to Lenders pro-rata all unreimbursed costs and expenses
paid or incurred by Lenders (including costs and expenses incurred
by Administrative Agent as a Lender that are not reimbursable as
provided in the preceding clause) that are payable or reimbursable
by Borrower hereunder; (iv) fourth, to the payment of accrued and
unpaid fees due hereunder and all other amounts due hereunder
(other than the Loans and interest accrued thereon); (v) fifth, to
the payment of the Loans of each of the Lenders and interest
accrued thereon (which payments shall be pro rata to each of the
Lenders in accordance with the amount of the Loans outstanding) and
to the payment (pari passu with the foregoing) of any Rate Hedging
Obligations and cash collateral to the Letter of Credit Issuer as
collateral for the Letter of Credit Exposure; and (vi) sixth, to
the payment of the other Loan Obligations. Any remaining amounts
shall be applied to payment of all the Obligations to
Administrative Agent. Any further remaining amounts shall be paid
to Borrower or such other Persons as shall be legally entitled
thereto. Except as expressly provided otherwise herein, Lenders may
apply and reverse and reapply, payments and proceeds of the
Collateral to the Loan Obligations in such order and manner as
Lenders determine in their absolute discretion.
5.32. LIMITATION OF LIABILITY; WAIVER.
A new Section 15.5 is added to the Original Loan Agreement as follows:
"15.5. LIMITATION OF LIABILITY; WAIVER; NOTICE. Administrative
Agent and Lenders shall not be liable to Borrower as a result of
any commercially reasonable possession, repossession, collection or
sale by Administrative Agent of Collateral; and Borrower hereby
waives all rights of redemption from any such sale and the benefit
of all valuation, appraisal and exemption Laws. If Administrative
Agent seeks to take possession of any of the Collateral by replevin
or other court process, Borrower hereby irrevocably waives (i) the
posting of any bonds, surety and security relating thereto required
by any statute, court rule or otherwise as an incident to such
possession, (ii) any demand for possession of the Collateral prior
to the commencement of any suit or action to recover possession
thereof, (iii) any requirement that Administrative Agent retain
possession and not dispose of any Collateral until after trial or
final judgment, and (iv) to the extent permitted by applicable Law,
all rights to notice and hearing prior to the exercise by
Administrative Agent of Administrative Agent's right to repossess
the Collateral without judicial
15
process or to replevy, attach or levy upon the Collateral without
notice or hearing. Administrative Agent shall have no obligation to
preserve rights to the Collateral or to xxxxxxxx any Collateral for
the benefit of any Person. Any notice of intended action required
to be given by Administrative Agent (including notice of a public
or private sale of Collateral), if given as provided in this
Agreement at least 10 days prior to such proposed action, shall be
effective and constitute reasonable and fair notice to Borrower."
5.33. APPOINTMENT OF ADMINISTRATIVE AGENT.
Clause (b) of the third sentence to Section 16.1 to the Original Loan
Agreement is deleted and replaced with the following:
"(b) shall not be responsible to the Lenders for any recital,
statement, representation, or warranty (whether written or oral)
made in or in connection with any Loan Document or any certificate
or other document referred to or provided for in, or received by
any of them under, any Loan Document, or for the value, validity,
effectiveness, genuineness, enforceability, or sufficiency of any
Loan Document, or any other document referred to or provided for
therein or for any failure by any Covered Person or any other
Person to perform any of its obligations thereunder or the validity
or priority of any Security Interest in any Collateral or the
sufficiency or value of any Collateral;"
5.34. LENDERS' RIGHT TO CURE.
Section 18.1 to the Original Loan Agreement is deleted and replaced with the
following:
"18.1. LENDERS' RIGHT TO CURE. Administrative Agent may, and
Required Lenders may, from time to time, in their absolute
discretion, for Borrower's account and at Borrower's expense, make
a Revolving Loan Advance in any amount, or do any act required of
Borrower hereunder or requested by Administrative Agent or Required
Lenders to preserve, protect, maintain or enforce the Loan
Obligations, the Collateral or Administrative Agent's Security
Interests therein for the benefit of Lenders, which Borrower is
required to pay or do, but fails to pay or do, including payment of
any judgment against Borrower, insurance premium, taxes or
assessments, warehouse charge, finishing or processing charge,
landlord's claim, and any other Security Interest upon or with
respect to the Collateral or any of its other assets. All payments
that Administrative Agent or Lenders make pursuant to this Section
and all out-of-pocket costs and expenses that Administrative Agent
or Lenders pay or incur in connection with any action taken by them
hereunder shall be a part of the Loan Obligations. Any payment made
or other action taken by Administrative Agent or Lenders pursuant
to this Section shall be without prejudice to any right to assert
an Event of Default hereunder and to pursue Administrative Agent or
Lenders' other rights and remedies with respect thereto. All
payments that Lenders make pursuant to this Section and all
out-of-pocket costs and expenses that Administrative Agent or
Lenders pay or incur in connection with any action taken by them
hereunder shall be a part of the Loan Obligations, the repayment of
which shall be secured by the Collateral."
5.35. EXPENSES.
Section 18.7 to the Original Loan Agreement is amended by inserting the
following immediately before the phrase "the administration of this
Agreement;" in line five thereof:
"the perfection of Administrative Agent's Security Interests in the
Collateral; the protection, disposition, or foreclosure of any
Security Interest on or with respect to any Collateral; the cost of
searches for Security Interests existing against Covered Persons;
recording and filing fees;"
16
5.36. GOVERNING LAW; NO THIRD PARTY RIGHTS.
Section 19.8 to the Original Loan Agreement is deleted and replaced with the
following:
"19.8. GOVERNING LAW; NO THIRD PARTY RIGHTS. This Agreement, the
Notes and the other Loan Documents and the rights and obligations
of the parties hereunder and thereunder shall be governed by and
construed and interpreted in accordance with the internal Laws of
the State of Illinois applicable to contracts made and to be
performed wholly within such state, without regard to choice or
conflicts of law principles; except that the provisions of the Loan
Documents pertaining to the creation or perfection of Security
Interests or the enforcement of rights of Administrative Agent and
Lenders in Collateral located in a State other that the State of
Illinois shall be governed by the Laws of such State. This
Agreement is solely for the benefit of the parties hereto and their
respective successors and assigns, and no other Person shall have
any right, benefit, priority or interest under, or because of the
existence of, this Agreement."
5.37. CHOICE OF FORUM.
Section 19.12 to the Original Loan Agreement is deleted and replaced with
the following:
"19.12. CHOICE OF FORUM. SUBJECT ONLY TO THE EXCEPTION IN THE NEXT
SENTENCE, BORROWER, ADMINISTRATIVE AGENT, AND EACH LENDER HEREBY
AGREES TO THE EXCLUSIVE JURISDICTION OF THE FEDERAL COURT OF THE
NORTHERN DISTRICT OF ILLINOIS AND THE STATE COURTS OF ILLINOIS
LOCATED IN XXXX COUNTY AND WAIVES ANY OBJECTION BASED ON VENUE OR
FORUM NON CONVENIENS WITH RESPECT TO ANY ACTION INSTITUTED THEREIN,
AND AGREES THAT ANY DISPUTE CONCERNING THE RELATIONSHIP BETWEEN
ADMINISTRATIVE AGENT, LENDERS, AND BORROWER OR THE CONDUCT OF ANY
OF THEM IN CONNECTION WITH THIS AGREEMENT OR OTHERWISE SHALL BE
HEARD ONLY IN THE COURTS DESCRIBED ABOVE. NOTWITHSTANDING THE
FOREGOING: (1) ADMINISTRATIVE AGENT OR ANY LENDER SHALL HAVE THE
RIGHT TO BRING ANY ACTION OR PROCEEDING AGAINST BORROWER OR ITS
PROPERTY IN ANY COURTS OF ANY OTHER JURISDICTION ADMINISTRATIVE
AGENT OR ANY LENDER DEEM NECESSARY OR APPROPRIATE IN ORDER TO
REALIZE ON THE COLLATERAL, REAL ESTATE OR OTHER SECURITY FOR THE
LOAN OBLIGATIONS, AND (2) EACH OF THE PARTIES HERETO ACKNOWLEDGES
THAT ANY APPEALS FROM THE COURTS DESCRIBED IN THE IMMEDIATELY
PRECEDING SENTENCE MAY HAVE TO BE HEARD BY A COURT LOCATED OUTSIDE
THOSE JURISDICTIONS."
5.38. NEW ARTICLE 20 AND ARTICLE 21. The following new Articles 20
and 21 are added to the Original Loan Agreement:
"20. SECURITY AND GUARANTIES. As security for the payment and
performance of the Loan Obligations, and also as security for the
payment and performance of all Obligations to Administrative Agent,
Borrower shall execute and deliver, or cause to be executed and
delivered, to Administrative Agent the following documents, each
satisfactory to Lenders:
20.1. SECURITY AGREEMENTS. Security agreements granting to
Administrative Agent for the benefit of Lenders a first priority
Security Interest under the UCC in all of the Goods, Equipment,
Accounts, Inventory, Instruments, Documents, Chattel Paper,
Securities, General Intangibles, including Intellectual Property,
and other personal property of each Covered Person
17
and every Subsidiary of each Covered Person, whether now owned or
hereafter acquired, and all proceeds thereof, subject only to
Permitted Security Interests affecting such property.
20.4. ADDITIONAL SUBSIDIARIES; GUARANTIES. As further security for
the payment and performance of the Loan Obligations, each
Subsidiary, other than a Dormant Subsidiary, of any Covered Person,
including any Subsidiary of any Covered Person that is acquired or
organized after the First Amendment Date, shall (i) execute and
deliver or cause to be executed and delivered by the applicable
Covered Person, an addendum to a Security Agreement granting to
Administrative Agent for the benefit of Lenders a first priority
Security Interest in all of the voting capital stock, securities,
membership interests or other equity interests, as applicable (and
all options and warrants therefor), of any such later acquired or
organized Subsidiary, now or hereafter issued and outstanding, and
all proceeds thereof, and (ii) execute and delivery, or cause to be
executed and delivered to Administrative Agent, by every now
existing and hereafter later acquired or organized Subsidiary of
any Covered Person (which may only be acquired or organized if
permitted elsewhere in this Agreement) an unconditional guaranty of
the Loan Obligations or, at the option of Administrative Agent in
Administrative Agent's absolute discretion, a joinder agreement in
which such Subsidiary becomes a Borrower under this Agreement and
assumes primary, joint and several liability for the Loan
Obligations, and a Security Agreement (as described in Section 8.2)
and other appropriate security documents, each in form satisfactory
to Lenders.
Administrative Agent may, either before or after an Event of
Default, but only with the consent or at the direction of all
Lenders, granted or withheld in their absolute discretion,
exchange, waive or release its Security Interests in any of the
Collateral in an amount equal to or in excess of an aggregate fair
market value of $2,500,000 in any calendar year or permit Borrower
to substitute any personal property for any of the Collateral in an
amount equal to or in excess of an aggregate fair market value of
$2,500,000 in any calendar year in all cases without affecting the
Loan Obligations or Administrative Agent's right to take any other
action with respect to any other Collateral.
Notwithstanding the preceding paragraph, Administrative Agent may,
in its absolute discretion and without the consent of any Lender,
(i) exchange, waive or release its Security Interests in any of the
Collateral having an aggregate fair market value of less than
$2,500,000 in any calendar year in all cases without affecting the
Loan Obligations or Administrative Agent's right to take any other
action with respect to any other Collateral, or (ii) upon the
indefeasible payment in full of all of the Loan Obligations, the
expiration or termination of all Letters of Credit and reduction of
the Letter of Credit Exposure to zero, and the termination of the
Commitments, release its Security Interests in all the Collateral.
21. POWER OF ATTORNEY. Borrower hereby authorizes Administrative
Agent and irrevocably appoints Administrative Agent (acting by any
of its officers) as such Borrower's agent and attorney-in-fact
(which appointment is coupled with an interest and is therefore
irrevocable) to do any of the following, and hereby consents and
authorizes any of the following, until all of the Loan Obligations
are fully and indefeasibly paid and satisfied, there are no Letters
of Credit outstanding and the Letter of Credit Exposure is
irreversibly zero, and the Commitments are terminated:
21.1. At any time while there is an Existing Default, (i) demand
payment of any Account; (ii) enforce payment of any Account by
legal proceedings or otherwise; (iii) exercise all of such
Borrower's rights and remedies in proceedings brought to collect
any Account; (iv) sell or assign
18
any Account upon such terms, for such amount and at such time or
times as Administrative Agent deems advisable; (v) settle, adjust,
compromise, extend or renew any Account; (vi) discharge and release
any Account; (vii) prepare, file and sign such Borrower's name on
any proof of claim in bankruptcy or other similar documents against
an Account Debtor; (viii) notify the postal authorities of any
change of the address for delivery of such Borrower's mail to any
address designated by Administrative Agent, and open and process
all mail addressed to such Borrower; (ix) endorse such Borrower's
name on any verification of Accounts and notices thereof to Account
Debtors; (x) make one or more Revolving Loan Advances to pay the
costs and expenses of any of the foregoing; (xi) take control in
any manner of any item of payment or proceeds of any Account; (xii)
have access to any lockbox or postal box into which such Borrower's
mail is deposited; (xiii) endorse such Borrower's name upon any
items of payment and deposit the same in the Cash Collateral
Account and apply the proceeds thereof to the Loan Obligations as
provided herein; (xiv) endorse such Borrower's name upon any
chattel paper, document, instrument, invoice, or similar document
or agreement relating to any Account or other item of the
Collateral; and (xv) do anything that Administrative Agent deems
necessary in its reasonable discretion to assure that the Loan
Obligations are fully and indefeasibly paid and satisfied.
21.2. At any time, file any financing statement or amendments
thereto deemed necessary or appropriate by Administrative Agent to
assure the perfection or continued perfection of Administrative
Agent's Security Interests in the Collateral for the benefit of
Lenders.
The foregoing power of attorney and authorization shall be deemed
automatically revoked upon the indefeasible payment in full of all
of the Loan Obligations, the expiration or termination of all
Letters of Credit and reduction of the Letter of Credit Exposure to
zero, and the termination of the Commitments."
5.39. EXISTING DEFINITIONS. The definition of "Material Adverse
Effect is deleted and replaced with the following:
"MATERIAL ADVERSE EFFECT -- as to Borrower or any Covered Person
and with respect to any event or occurrence of whatever nature
(including any adverse determination in any litigation,
arbitration, investigation or proceeding), material adverse effect
on (i) the business, operations, revenues, financial condition,
property, or business prospects of the Covered Persons taken as a
whole, (ii) the value of its assets taken as a whole or the value
of the Collateral taken as a whole, (iii) the validity or
enforceability of the Loan Documents, (iv) the ability of any
Covered Person to timely pay or perform such Covered Person's
Obligations generally as they become due, (v) in the case of
Borrower specifically, the ability of Borrower to pay or perform
any of Borrower's Obligations to Lender, or (vi) in the case of a
Guarantor specifically, the ability of such Guarantor to pay or
perform any of its Obligations under the terms of its Guaranty."
5.40. NEW DEFINITIONS. The following new definitions are hereby
added to the Original Loan Agreement in alphabetical order:
"ACCOUNT -- as to any Person, the right of such Person to payment
for goods sold or leased or for services rendered by such Person."
"ACCOUNT DEBTOR -- the obligor on any Account."
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"ASSET COVERAGE RATIO -- means the ratio of: (I) the sum of (a)
80% of eligible accounts receivables (as determined by the
Administrative Agent), (b) the lesser of: (i) 25% of eligible
inventory (as determined by Administrative Agent), or (ii)
$10,000,000, (c) 80% of the appraised orderly liquidation value of
all eligible equipment (as determined by Administrative Agent),
including eligible equipment (as determined by Administrative
Agent) acquired in a Permitted Acquisition (except for any newly
acquired equipment, for which no appraisal shall be required if
such equipment is less than six months old at the time of the
determination of this ratio, in which case the advance rate will be
based off of original invoice cost), and (d) 75% of the appraised
value of such parcels of real estate of the Borrower and the
Covered Persons meeting the Real Estate Closing Conditions on which
Administrative Agent has a first priority lien and which is
otherwise satisfactory to Administrative Agent and the Lenders, to
(II) the sum of the outstanding principal amount of the Loan
Obligations and the face amount of the Letters of Credit."
"COLLATERAL -- all Personal Property Collateral and any other
property (real or personal) in which Administrative Agent or a
Lender has a Security Interest to secure payment or performance of
all or any of the Loan Obligations and all proceeds and products
thereof."
"DORMANT SUBSIDIARIES -- means those Subsidiaries identified as
such on section 10.26 to the Disclosure Schedule.
"ENCUMBRANCE -- as to any item of real or personal property, any
easement, right-of-way, license, condition, or restrictive
covenant, or zoning or similar restriction, that is not a Security
Interest but is enforceable by any Person other than the record
owner of such property."
"FIRST AMENDMENT DATE means July 29, 2005."
"INSURANCE/CONDEMNATION PROCEEDS -- insurance proceeds payable as a
consequence of damage to or destruction of any of the Collateral
and proceeds payable as a consequence of condemnation or sale in
lieu of condemnation of any of the Collateral."
"INTELLECTUAL PROPERTY -- as to any Person, any domestic or foreign
patents or patent applications of such Person, any inventions made
or owned by such Person upon which either domestic or foreign
patent applications have not yet been filed, any domestic or
foreign trade names or trademarks of such Person, any domestic or
foreign trademark registrations or applications filed by such
Person, any domestic or foreign service marks of such Person, any
domestic or foreign service xxxx registrations and applications by
such Person, any domestic or foreign copyrights of such Person, and
any domestic or foreign copyright registrations or applications by
such Person."
"INVENTORY -- goods owned and held by a Person for sale, lease or
resale or furnished or to be furnished under contracts for
services, and raw materials, goods in process, materials, component
parts and supplies used or consumed, or held for use or consumption
in such Person's business."
MINIMUM ASSET COVERAGE RATIO -- means a Minimum Asset Coverage
Ratio of no less 1.05 to 1.00.
"MORTGAGE -- any deed of trust or mortgage or leasehold deed of
trust or mortgage required or contemplated under this Agreement to
be executed and delivered to Administrative Agent for the benefit
of Lenders in form and substance satisfactory to Administrative
Agent."
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"PERSONAL PROPERTY COLLATERAL -- all of the Goods, Equipment,
Accounts, Inventory, Instruments, Documents, Chattel Paper, General
Intangibles, Securities and other personal property of Borrower,
whether now owned or hereafter acquired, and all proceeds thereof,
in which Administrative Agent at any time holds a Security Interest
for the benefit of Lenders."
"REAL ESTATE CLOSING means the closing of the granting to the
Administrative Agent of a first priority Security Interest in real
estate owned by the Borrower or any other Covered Person with all
the Real Estate Closing Conditions being met to the satisfaction of
the Required Lenders, with an aggregate appraised value, together
with the other components of the Asset Coverage Ratio on which
Administrative Agent has a first priority Security Interest, as
determined by the Administrative Agent (including, without
limitation eligibility requirements), on a pro forma basis,
resulting in the Minimum Asset Coverage Ratio being met."
"REAL ESTATE CLOSING CONDITIONS means with respect to each parcel
of real estate subject to the Real Estate Closing the (i) the
delivery to the Administrative Agent of a title insurance
commitment issued by a title insurance company satisfactory to
Administrative Agent, and with all exceptions documents, (ii) a
commitment by a title insurance company satisfactory to
Administrative Agent to issue a title insurance policy, with such
endorsements as may be required by the Administrative Agent showing
no Security Interests or Encumbrances other than Encumbrances
acceptable to the Administrative Agent and on such other terms and
conditions as reasonably required by Administrative Agent, (iii) a
current ALTA survey in form and substance satisfactory to
Administrative Agent, (iv) a flood letter showing such parcel does
not lie in a flood plain or if it does flood insurance satisfactory
to Administrative Agent, (v) environmental reports satisfactory to
Administrative Agent (which such reports may also include Phase II
reports if required by Administrative Agent), (vi) a written
appraisal performed by an MAI certified appraiser selected by
Administrative Agent, (vii) a duly executed and recordable
Mortgage, and (viii) such other documents, opinions, certificates,
agreements, title and lien searches, and other matters as may be
requested by Administrative Agent or the Required Lenders."
"SECURITY AGREEMENT -- any security agreement required or
contemplated under this Agreement to be executed and delivered to
Administrative Agent for the benefit of Lenders."
"SECURITY DOCUMENTS -- all of the documents required or
contemplated to be executed and delivered to Administrative Agent
for the benefit of Lenders under this Agreement, all other
documents granting a Security Interest in any asset of Borrower or
any other Person to secure the payment or performance of any of the
Loan Obligations from time to time, including any similar documents
at any time executed and delivered to Administrative Agent for the
benefit of Lenders from time to time, by Borrower, any Covered
Person, or any other Person to secure payment or performance of any
of the Loan Obligations."
6. PATRIOT ACT NOTIFICATION. As required by applicable federal Law and
Administrative Agent's and each other Lender's policies and practices,
Administrative Agent and each Lender may need to collect certain customer
identification information and documentation in connection with opening or
maintaining accounts, or establishing or continuing to provide services.
7. REPRESENTATIONS AND WARRANTIES OF BORROWER. Borrower hereby represents
and warrants to Administrative Agent and the Lenders that (i) Borrower's
execution, delivery and performance of this
21
Agreement has been duly authorized by all requisite action of Borrower, (ii)
no consents are necessary from any third parties for Borrower's execution,
delivery or performance of this Agreement, (iii) this Agreement, the Loan
Agreement, each of the other Loan Documents, constitute the legal, valid and
binding obligations of Borrower enforceable against Borrower in accordance
with their terms, except to the extent that the enforceability thereof
against Borrower may be limited by bankruptcy, insolvency or other laws
affecting the enforceability of creditors rights generally or by equity
principles of general application, (iv) except as disclosed on the
supplemental disclosure schedule attached hereto as Exhibit B and the
---------
disclosure schedule attached to the Original Loan Agreement, all of the
representations and warranties contained in Section 10 of the Loan Agreement
are true and correct with the same force and effect as if made on and as of
the date of this Agreement, (v) after giving effect to this Agreement, there
is no Existing Default, (vi) since the Effective Date, there has been no
change or modification to the Charter Documents of Borrower or any other
Covered Person, (vii) since the date of the Initial Financial Statements,
there has been no change in the financial condition or business operations
of Borrower or any other Covered Person which could reasonably be expected
to result in a Material Adverse Effect, (viii) there are no proceedings of
any kind, pending or threatened against Borrower or any other Covered
Person, which could reasonably be expected to result in a Material Adverse
Effect, and (ix) there are no Security Interests with respect to the
Borrower or its assets, except for Permitted Security Interests.
8. REAFFIRMATION. Borrower hereby represents, warrants, acknowledges and
confirms that (i) the Loan Agreement and the other Loan Documents remain in
full force and effect, (ii) Borrower has no defenses to its obligations
under the Loan Agreement and the other Loan Documents, and (iii) Borrower
has no claim against Administrative Agent or any Lender arising from or in
connection with the Loan Agreement or the other Loan Documents and any such
claim is hereby irrevocably waived and released and discharged forever.
9. GOVERNING LAW. This Agreement has been deemed to be executed and
delivered in Chicago, Illinois, and shall be governed by and construed under
the laws of the State of Illinois without giving effect to choice or
conflicts of law principles thereunder.
10. SECTION TITLES. The section titles in this Agreement are for convenience
of reference only and shall not be construed so as to modify any provisions
of this Agreement.
11. COUNTERPARTS; FACSIMILE TRANSMISSIONS. This Agreement may be executed in
one or more counterparts and on separate counterparts, each of which shall
be deemed an original, but all of which together shall constitute one and
the same instrument. Signatures to this Agreement may be given by facsimile
or other electronic transmission, and such signatures shall be fully binding
on the party sending the same.
12. INCORPORATION BY REFERENCE. Administrative Agent, Lenders and Borrower
hereby agree that all of the terms of the Loan Documents are incorporated in
and made a part of this Agreement by this reference.
13. FEES AND EXPENSES. Borrower shall promptly pay to Administrative Agent
all fees, expenses and other amounts owing to Administrative Agent under the
Loan Agreement and the other Loan Documents, including, without limitation,
all fees, costs and expenses incurred by Administrative Agent in connection
with the preparation, negotiation, execution, and delivery of this
Agreement.
14. NOTICE--ORAL COMMITMENTS NOT ENFORCEABLE. Nothing contained in the
following notice shall be deemed to limit or modify the terms of the Loan
Documents:
22
ORAL AGREEMENTS OR COMMITMENTS TO LOAN MONEY, EXTEND CREDIT OR TO
FORBEAR FROM ENFORCING REPAYMENT OF A DEBT INCLUDING PROMISES TO
EXTEND OR RENEW SUCH DEBT ARE NOT ENFORCEABLE. TO PROTECT YOU
(BORROWER) AND US (CREDITOR) FROM MISUNDERSTANDING OR
DISAPPOINTMENT, ANY AGREEMENTS WE REACH COVERING SUCH MATTERS ARE
CONTAINED IN THIS WRITING, WHICH IS THE COMPLETE AND EXCLUSIVE
STATEMENT OF THE AGREEMENT BETWEEN US, EXCEPT AS WE MAY LATER AGREE
IN WRITING TO MODIFY IT.
Borrower acknowledges that there are no other agreements between
Administrative Agent, Lenders, and Borrower, oral or written, concerning
the subject matter of the Loan Documents, and that all prior agreements
concerning the same subject matter, including any proposal or commitment
letter, are merged into the Loan Documents and thereby extinguished.
15. STATUTORY NOTICE-INSURANCE. The following notice is given pursuant to
Section 10 of the Collateral Protection Act set forth in Chapter 815 Section
180/1 of the Illinois Compiled Statutes (1996); nothing contained in such
notice shall be deemed to limit or modify the terms of the Loan Documents:
UNLESS YOU PROVIDE EVIDENCE OF THE INSURANCE COVERAGE REQUIRED BY
YOUR AGREEMENT WITH US, WE MAY PURCHASE INSURANCE AT YOUR EXPENSE
TO PROTECT OUR INTERESTS IN YOUR COLLATERAL. THIS INSURANCE MAY,
BUT NEED NOT, PROTECT YOUR INTERESTS. THE COVERAGE THAT WE PURCHASE
MAY NOT PAY ANY CLAIM THAT YOU MAKE OR ANY CLAIM THAT IS MADE
AGAINST YOU IN CONNECTION WITH THE COLLATERAL. YOU MAY LATER CANCEL
ANY INSURANCE PURCHASED BY US, BUT ONLY AFTER PROVIDING EVIDENCE
THAT YOU HAVE OBTAINED INSURANCE AS REQUIRED BY OUR AGREEMENT. IF
WE PURCHASE INSURANCE FOR THE COLLATERAL, YOU WILL BE RESPONSIBLE
FOR THE COSTS OF THAT INSURANCE, INCLUDING THE INSURANCE PREMIUM,
INTEREST AND ANY OTHER CHARGES WE MAY IMPOSE IN CONNECTION WITH THE
PLACEMENT OF THE INSURANCE, UNTIL THE EFFECTIVE DATE OF THE
CANCELLATION OR EXPIRATION OF THE INSURANCE. THE COSTS OF THE
INSURANCE MAY BE ADDED TO YOUR TOTAL OUTSTANDING BALANCE OR
OBLIGATION. THE COSTS OF THE INSURANCE MAY BE MORE THAN THE COST OF
INSURANCE YOU MAY BE ABLE TO OBTAIN ON YOUR OWN.
{REMAINDER OF PAGE INTENTIONALLY LEFT BLANK;
SIGNATURE PAGE IMMEDIATELY FOLLOWS}
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IN WITNESS WHEREOF, this Agreement has been duly executed as of the
date first above written.
XXXXXXXX CORPORATION, A MISSOURI CORPORATION, AS BORROWER
By: /s/ Xxxxx X. Xxxxxxx
--------------------------------------------------
Name: Xxxxx X. Xxxxxxx
------------------------------------------------
Title: Vice President
-----------------------------------------------
LASALLE BANK NATIONAL ASSOCIATION,
AS ADMINISTRATIVE AGENT AND A LENDER
By: /s/ Xxxxxxxx X. Xxxxxxx
--------------------------------------------------
Name: Xxxxxxxx X. Xxxxxxx
Title: Vice President
NATIONAL CITY BANK OF THE MIDWEST, A LENDER
By: /s/ X. Xxxxxx Trinberg
--------------------------------------------------
Name: X. Xxxxxx Trinberg
------------------------------------------------
Title: Vice President
-----------------------------------------------
UMB BANK, NATIONAL ASSOCIATION, A LENDER
By: /s/ Xxxxx X. Xxxx
--------------------------------------------------
Name: Xxxxx X. Xxxx
------------------------------------------------
Title: Executive Vice President
-----------------------------------------------
XXXXX FARGO BANK, N.A., A LENDER
By: /s/ Xxxxx X. Xxxxxxx
--------------------------------------------------
Name: Xxxxx X. Xxxxxxx
------------------------------------------------
Title: Vice President
-----------------------------------------------
REGIONS BANK fka UNION PLANTERS BANK, N.A., A LENDER
By: /s/ Xxxxxx X. Xxxxxx
--------------------------------------------------
Name: Xxxxxx X. Xxxxxx
------------------------------------------------
Title: Senior Vice President
-----------------------------------------------
24
