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CREDIT AGREEMENT
Dated as of October 22, 1998
by and among
INSIGNIA/ESG HOLDINGS, INC.
(to be renamed INSIGNIA FINANCIAL GROUP, INC.),
as Borrower,
the Lenders referred to herein,
FIRST UNION NATIONAL BANK,
as Administrative Agent
and
XXXXXX COMMERCIAL PAPER INC.,
as Syndication Agent
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TABLE OF CONTENTS
ARTICLE I -DEFINITIONS............................................................................................1
SECTION 1.1 Definitions.............................................................................1
SECTION 1.2 General................................................................................15
SECTION 1.3 Other Definitions and Provisions.......................................................16
ARTICLE II - CREDIT FACILITY.....................................................................................16
SECTION 2.1 Loans and Maximum Availability.........................................................16
SECTION 2.2 Procedure for Advances of Loans........................................................16
SECTION 2.3 Repayment of Loans.....................................................................18
SECTION 2.4 Notes..................................................................................19
SECTION 2.5 Permanent Reduction of the Aggregate Commitment........................................19
SECTION 2.6 Termination of Credit Facility.........................................................20
SECTION 2.7 Use of Proceeds........................................................................20
SECTION 2.8 Increase in Aggregate Commitment.......................................................20
ARTICLE III - LETTER OF CREDIT FACILITY.........................................................................21
SECTION 3.1 L/C Commitment.........................................................................21
SECTION 3.2 Procedure for Issuance of Letters of Credit............................................21
SECTION 3.3 Commissions and Other Charges..........................................................22
SECTION 3.4 L/C Participations.....................................................................22
SECTION 3.5 Reimbursement Obligation of the Borrower...............................................23
SECTION 3.6 Obligations Absolute...................................................................24
SECTION 3.7 Effect of Application..................................................................24
ARTICLE IV - GENERAL LOAN PROVISIONS.............................................................................25
SECTION 4.1 Interest...............................................................................25
SECTION 4.2 Notice and Manner of Conversion or Continuation of Loans...............................27
SECTION 4.3 Fees...................................................................................28
SECTION 4.4 Manner of Payment......................................................................28
SECTION 4.5 Crediting of Payments and Proceeds.....................................................29
SECTION 4.6 Adjustments............................................................................30
SECTION 4.7 Nature of Obligations of Lenders Regarding Extensions of Credit;
Assumption by the Administrative Agent.................................................30
SECTION 4.8 Changed Circumstances..................................................................31
SECTION 4.9 Indemnity..............................................................................33
SECTION 4.10 Capital Requirements...................................................................33
SECTION 4.11 Taxes..................................................................................34
SECTION 4.12 Mandatory Redenomination of Alternative Currency Loans.................................35
SECTION 4.13 Regulatory Limitation..................................................................36
SECTION 4.14 Claims for Increased Costs and Taxes...................................................37
SECTION 4.15 Rounding of Amounts in Certain Situations..............................................37
SECTION 4.16 Security...............................................................................37
ARTICLE V - CLOSING; CONDITIONS OF CLOSING AND BORROWING.........................................................37
SECTION 5.1 Closing................................................................................37
SECTION 5.2 Conditions to Closing, Initial Loan and Letter of Credit...............................37
SECTION 5.3 Conditions to All Loans and Letters of Credit..........................................40
ARTICLE VI - REPRESENTATIONS AND WARRANTIES OF THE BORROWER.....................................................40
SECTION 6.1 Representations and Warranties.........................................................40
SECTION 6.2 Survival of Representations and Warranties, Etc........................................47
ARTICLE VII - FINANCIAL INFORMATION AND NOTICES.................................................................47
SECTION 7.1 Financial Statements and Projections...................................................48
SECTION 7.2 Officer's Compliance Certificate.......................................................48
SECTION 7.3 Other Reports..........................................................................49
SECTION 7.4 Notice of Litigation and Other Matters.................................................49
SECTION 7.5 Accuracy of Information................................................................50
ARTICLE VIII - AFFIRMATIVE COVENANTS...........................................................................50
SECTION 8.1 Preservation of Corporate Existence and Related Matters................................50
SECTION 8.2 Maintenance of Property................................................................50
SECTION 8.3 Insurance..............................................................................50
SECTION 8.4 Accounting Methods and Financial Records...............................................51
SECTION 8.5 Payment and Performance of Obligations.................................................51
SECTION 8.6 Compliance With Laws and Approvals.....................................................51
SECTION 8.7 Environmental Laws.....................................................................51
SECTION 8.8 Compliance with ERISA..................................................................51
SECTION 8.9 Compliance With Agreements.............................................................52
SECTION 8.10 Conduct of Business....................................................................52
SECTION 8.11 Visits and Inspections.................................................................52
SECTION 8.12 Subsidiaries...........................................................................52
SECTION 8.13 Year 2000 Compatibility................................................................53
SECTION 8.14 Further Assurances.....................................................................53
ARTICLE IX - FINANCIAL COVENANTS................................................................................54
SECTION 9.1 Leverage Ratio.........................................................................54
SECTION 9.2 Minimum Net Worth......................................................................54
SECTION 9.3 Maximum Leverage.......................................................................54
SECTION 9.4 Interest Coverage Ratio................................................................54
ARTICLE X - NEGATIVE COVENANTS...................................................................................54
SECTION 10.1 Limitations on Debt.....................................................................54
SECTION 10.2 Limitations on Contingent Obligations...................................................55
SECTION 10.3 NEGATIVE PLEDGE; LIMITATION ON LIENS....................................................56
SECTION 10.4 Limitations on Loans, Advances, Investments and Acquisitions............................57
SECTION 10.5 Limitations on Mergers and Liquidation..................................................58
SECTION 10.6 Limitations on Sale of Assets...........................................................58
SECTION 10.7 Limitations on Dividends and Changes in Capital Structure...............................59
SECTION 10.8 Transactions with Affiliates............................................................59
SECTION 10.9 Certain Accounting Changes..............................................................60
SECTION 10.10 Amendments; Payments and Prepayments of Subordinated Debt...............................60
SECTION 10.11 Real Estate Development.................................................................60
SECTION 10.12 Lines of Business.......................................................................60
SECTION 10.13 Restrictive Agreements..................................................................61
ARTICLE XI - DEFAULT AND REMEDIES................................................................................61
SECTION 11.1 Events of Default.......................................................................61
SECTION 11.2 Remedies................................................................................64
SECTION 11.3 Rights and Remedies Cumulative; Non-Waiver; etc.........................................64
SECTION 11.4 Judgment Currency.......................................................................65
ARTICLE XII - THE AGENTS.........................................................................................65
SECTION 12.1 Appointment and Authorization...........................................................65
SECTION 12.2 Delegation of Duties....................................................................66
SECTION 12.3 Exculpatory Provisions..................................................................66
SECTION 12.4 Reliance by the Agents..................................................................66
SECTION 12.5 Notice of Default.......................................................................67
SECTION 12.6 Non-Reliance on the Agents and Other Lenders............................................67
SECTION 12.7 Indemnification.........................................................................67
SECTION 12.8 Agent in Its Individual Capacity........................................................68
SECTION 12.9 Resignation of the Administrative Agent; Successor Administrative
Agent...................................................................................68
ARTICLE - XIII - MISCELLANEOUS...................................................................................68
SECTION 13.1 Notices.................................................................................68
SECTION 13.2 Expenses; Indemnity.....................................................................70
SECTION 13.3 GOVERNING LAW...........................................................................71
SECTION 13.4 CONSENT TO JURISDICTION.................................................................71
SECTION 13.5 WAIVER OF JURY TRIAL....................................................................72
SECTION 13.6 Reversal of Payments....................................................................72
SECTION 13.7 Accounting Matters......................................................................72
SECTION 13.8 Successors and Assigns; Participations..................................................72
SECTION 13.9 Amendments, Waivers and Consents........................................................75
SECTION 13.10 Performance of Duties...................................................................76
SECTION 13.11 No Fiduciary Relationship...............................................................76
SECTION 13.12 All Powers Coupled with Interest........................................................76
SECTION 13.13 Survival of Indemnities.................................................................76
SECTION 13.14 Titles and Captions.....................................................................76
SECTION 13.15 Severability of Provisions..............................................................76
SECTION 13.16 Counterparts............................................................................77
SECTION 13.17 Term of Agreement.......................................................................77
SECTION 13.18 Independent Effect of Covenants.........................................................77
SECTION 13.19 EMU; Continuity of Contract.............................................................77
EXHIBITS
A - Notes
B - Notice of Borrowing
C - Notice of Conversion/Continuation
D - Notice of Repayment
E - Notice of Account Designation
F - Assignment and Acceptance
G - Officer's Compliance Certificate
H - Guaranty Agreement
I - Pledge and Security Agreement
J - Lender Addition and Acknowledgment Agreement
SCHEDULES
1.1(a) - Lenders
1.1(b) - Mandatory Cost Rate
6.1(a) - Subsidiaries - Organization, Ownership
6.1(i) - Employee Benefit Plans of Domestic Subsidiaries
6.1(l) - Material Contracts
6.1(s) - Debt and Contingent Obligations
6.1(t) - Litigation
10.3 - Existing Liens
10.4 - Investments in Unrestricted Subsidiaries and Affiliates
10.6 - Permitted Asset Sales
10.8 - Transactions with Affiliates
CREDIT AGREEMENT
THIS CREDIT AGREEMENT, dated as of the 22nd day of October, 1998, by
and among INSIGNIA/ESG HOLDINGS, INC. (to be renamed INSIGNIA FINANCIAL GROUP,
INC.), a corporation organized under the laws of Delaware (the "Borrower"), the
Lenders who are or may become a party to this Agreement (the "Lenders"), FIRST
UNION NATIONAL BANK, as Administrative Agent for the Lenders, and XXXXXX
COMMERCIAL PAPER INC., as Syndication Agent.
STATEMENT OF PURPOSE
The Borrower has requested and the Lenders have agreed to extend
certain credit facilities to the Borrower on the terms and conditions of this
Agreement.
NOW, THEREFORE, in consideration of the premises and agreements
contained herein, the parties hereby agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.1 Definitions. The following terms when used in this
Agreement shall have the meanings assigned to them below:
"Actual Knowledge" means information actually known to Xxxxxx X.
Xxxxxx, Chairman of the Board and Chief Executive Officer; Xxxxx X. Aston, Chief
Financial Officer; Xxxxxx Xxxxxx, Chief Operating Officer and Treasurer; Xxxx X.
Xxxxxxx, General Counsel and Secretary; or Xxxxxxx Xxxxxx, President, or any
other individual hereafter holding the office of the Borrower currently held by
such individuals, in each case at the date of determination.
"Administrative Agent" means First Union in its capacity as
Administrative Agent hereunder, and any successor thereto appointed pursuant to
Section 12.9.
"Administrative Agent's Correspondent" means First Union National Bank,
London Branch, or any other financial institution designated by the
Administrative Agent to act as its correspondent hereunder with respect to the
distribution and payment of Alternative Currency Loans.
"Administrative Agent's Office" means the office of the Administrative
Agent specified in or determined in accordance with the provisions of Section
13.1.
"Affiliate" means, with respect to any Person, any other Person (other
than a Subsidiary of such first Person) which directly or indirectly through one
or more intermediaries, controls, or is controlled by, or is under common
control with, such first Person or any of its Subsidiaries.
"Agents" means the collective reference to the Administrative Agent and
the Syndication Agent; "Agent" means either of such Persons.
"Aggregate Commitment" means the aggregate amount of the Lenders'
Commitments hereunder, as such amount may be reduced at any time or from time to
time pursuant to Section 2.5 or increased at any time or from time to time
pursuant to Section 2.8. On the Closing Date, the Aggregate Commitment shall be
One Hundred Eighty-five Million Dollars ($185,000,000).
"Agreement" means this Credit Agreement, as amended, modified, restated
or supplemented from time to time.
"Alternative Currency" means Pounds Sterling, provided that up to an
aggregate of the lesser of $10,000,000 or the Alternative Currency Commitment
may be denominated in Canadian Dollars, Dutch Guilders, French Francs or
Deutsche Marks, and, with the prior written consent of the Administrative Agent
and each of the Lenders, any other lawful currency (other than Dollars) which is
freely transferable and convertible into Dollars in the United States currency
market and freely available to all of the Lenders in the London interbank
deposit market.
"Alternative Currency Amount" means with respect to each Loan made or
continued (or to be made or continued) in an Alternative Currency, the amount of
such Alternative Currency which is equivalent to the principal amount in Dollars
of such Loan at the most favorable spot exchange rate determined by the
Administrative Agent to be available to it at approximately 11:00 a.m. (the time
of the Administrative Agent's Correspondent) two (2) Business Days before such
Loan is made or continued (or to be made or continued). When used with respect
to any other sum expressed in Dollars, "Alternative Currency Amount" shall mean
the amount of such Alternative Currency which is equivalent to the amount so
expressed in Dollars at the most favorable spot exchange rate determined by the
Administrative Agent to be available to it at the relevant time.
"Alternative Currency Commitment" means Fifty Million Dollars
($50,000,000), as such amount may be reduced or modified at any time or from
time to time pursuant to the terms hereof, provided that up to an aggregate of
the lesser of Ten Million Dollars ($10,000,000) or the Alternative Currency
Commitment may at any time be denominated in Canadian Dollars, Dutch Gilders,
French Francs or Deutsche Marks.
"Alternative Currency Loan" means any Loan denominated in an
Alternative Currency.
"Applicable Law" means in respect of any Person all provisions of
constitutions, statutes, laws, rules, treaties, regulations and orders of all
Governmental Authorities and all orders and decrees of all courts and
arbitrators applicable to such Person.
"Applicable Margin" shall have the meaning assigned thereto in Section
4.1(c); provided that with respect to each LIBOR Rate Loan made in an
Alternative Currency, the Applicable
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Margin shall include the Mandatory Cost Rate, as determined pursuant to the
formula set forth on the attached Schedule 1.1(b).
"Application" means an application, in the form specified by the
Issuing Lender from time to time, requesting the Issuing Lender to issue a
Letter of Credit.
"Assignment and Acceptance" shall have the meaning assigned thereto in
Section 13.8(b)(iii).
"Available Commitment" means, as to any Lender at any time, an amount
equal to (a) such Lender's Commitment less (b) such Lender's Extensions of
Credit.
"Base Rate" means, at any time, the higher of (a) the Prime Rate or (b)
the Federal Funds Rate plus 1/2 of 1%; each change in the Base Rate shall take
effect simultaneously with the corresponding change or changes in the Prime Rate
or the Federal Funds Rate, as applicable.
"Base Rate Loan" means any Loan bearing interest at a rate based upon
the Base Rate as provided in Section 4.1(a).
"Borrower" means Insignia/ESG Holdings, Inc. (to be renamed Insignia
Financial Group, Inc.).
"Business Day" means (a) for all purposes other than as set forth in
clause (b) below, any day, other than a Saturday, Sunday or legal holiday, on
which banks in Greenville, South Carolina, Charlotte, North Carolina and New
York, New York are open for the conduct of their domestic or international
commercial banking business, as applicable, and (b) with respect to all notices
and determinations in connection with, and payments of principal and interest
on, any LIBOR Rate Loan, any day (i) that is a Business Day described in clause
(a) and that is also a day for trading by and between banks in deposits for the
applicable Permitted Currency in the London interbank market and (ii) on which
banks are open for the conduct of their domestic and international banking
business in the place where the Administrative Agent or the Administrative
Agent's Correspondent shall make available Loans in such Permitted Currency.
Notwithstanding the foregoing, with respect to any amount denominated or to be
denominated in the euro or a national currency unit, any reference to a
"Business Day" shall be construed as a reference to a day (other than a Saturday
or Sunday) on which banks are generally open for business in New York City and
prime banks in London generally provide quotations for deposits denominated
therein.
"Capital Lease" means, with respect to the Borrower and its
Subsidiaries, any lease of any property that is, in accordance with GAAP,
classified and accounted for as a capital lease on a Consolidated balance sheet
of the Borrower and its Subsidiaries.
"Closing Date" means the date of this Agreement.
"Code" means the Internal Revenue Code of 1986, and the rules and
regulations thereunder, each as amended or supplemented from time to time.
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"Co-Investment Entity" means any corporation, limited liability
company, partnership or other form of entity (i) in which the Borrower or a
Subsidiary of the Borrower owns an equity interest pursuant to a joint venture
or similar arrangement with one or more Persons who own more than fifty percent
(50%) of the ownership or other equity interest in such entity, (ii) which has
as its principal business the ownership of real property, and (iii) which does
not engage in any real estate development activities for its own account.
"Commitment" means, as to any Lender, the obligation of such Lender to
make Loans or to issue or participate in Letters of Credit issued for the
account of the Borrower hereunder in an aggregate principal amount at any time
outstanding not to exceed the amount set forth opposite such Lender's name on
Schedule 1.1(a), as the same may be increased, reduced or modified at any time
or from time to time pursuant to the terms hereof.
"Commitment Percentage" means, as to any Lender at any time (a) prior
to the Termination Date, the ratio of (i) the amount of the Commitment of such
Lender to (ii) the Aggregate Commitment of all of the Lenders, and (b) on and
after the Termination Date, the ratio of (i) the amount of the Extensions of
Credit of such Lender to (ii) the aggregate amount of all Extensions of Credit
then outstanding.
"Consolidated" means, when used with reference to financial statements
or financial statement items of the Borrower and its Subsidiaries, such
statements or items on a consolidated basis in accordance with applicable
principles of consolidation under GAAP.
"Consolidated Net Worth" means, at any date of determination, an amount
equal to the sum of the total shareholders' equity (including capital stock,
additional paid-in capital and retained earnings after deducting the treasury
stock) of the Borrower and its Subsidiaries appearing on a Consolidated balance
sheet of the Borrower and its Subsidiaries prepared in accordance with GAAP.
"Contingent Obligation" means, with respect to any Person, without
duplication, any obligation, contingent or otherwise, of such Person pursuant to
which such Person has directly or indirectly guaranteed any Debt or other
material asserted payment obligation of any other Person and, without limiting
the generality of the foregoing, any obligation, direct or indirect, contingent
or otherwise, of such first Person (a) to purchase or pay (or advance or supply
funds for the purchase or payment of) such Debt or other obligation (whether
arising by agreement to keep well, to purchase assets, goods, securities or
services or to take-or-pay) or (b) entered into for the purpose of assuring in
any other manner the obligee of such Debt or other obligation of the payment
thereof or to protect such obligee against loss in respect thereof (in whole or
in part); provided that the term Contingent Obligation shall not include (i)
endorsements for collection or deposit in the ordinary course of business and
(ii) earn-out obligations (which are included in Debt).
"Controlled Co-Investment Entity" means any Co-Investment Entity with
respect to whom the Borrower and its Subsidiaries provide property management
services and either (a) possess sole authority to sell, finance, refinance and
make daily operating decisions or (b) possess joint authority over such matters.
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"Credit Facility" means the collective reference to the Revolving
Credit Facility and the L/C Facility.
"Debt" means, with respect to the Borrower and its Subsidiaries at any
date and without duplication, the sum of the following calculated in accordance
with GAAP: (a) all Debt for Money Borrowed, (b) all obligations to pay the
deferred purchase price of property or services of any such Person, except trade
payables arising in the ordinary course of business not more than ninety (90)
days past due, (c) all Debt of any Person secured by a Lien on any asset of the
Borrower and its Restricted Subsidiaries, (d) all Contingent Obligations of any
such Person with respect to Debt, (e) the Borrower's reasonable estimate of the
aggregate liability of the Borrower and its Restricted Subsidiaries with respect
to all earn-out obligations and (f) all net obligations incurred by any such
Person pursuant to Hedging Agreements.
"Debt for Money Borrowed" means, with respect to the Borrower and its
Restricted Subsidiaries at any date and without duplication, the sum of the
following calculated in accordance with GAAP: (a) all liabilities, obligations
and indebtedness for borrowed money, including, but not limited to, obligations
evidenced by bonds, debentures, notes or other similar instruments of any
Person, (b) all obligations of any Person as lessee under Capital Leases, (c)
all Contingent Obligations of any such Person with respect to Debt for Money
Borrowed, and (d) all obligations, contingent or otherwise, of any such Person
relative to the face amount of letters of credit, whether or not drawn, and
banker's acceptances issued for the account of any such Person.
"Default" means any of the events specified in Section 11.1 which with
the passage of time, the giving of notice or any other condition, would
constitute an Event of Default.
"Defaulting Lender" shall have the meaning assigned thereto in Section
4.7.
"Dollar Amount" means (a) with respect to each Loan made or continued
(or to be made or continued) in Dollars, the principal amount thereof and (b)
with respect to each Loan made or continued (or to be made or continued) in an
Alternative Currency, the amount of Dollars which is equivalent to the principal
amount of such Loan at the most favorable spot exchange rate determined by the
Administrative Agent at approximately 11:00 a.m. (the time of the Administrative
Agent's Correspondent) two (2) Business Days before such Loan is made or
continued (or to be made or continued). When used with respect to any other sum
expressed in an Alternative Currency, "Dollar Amount" shall mean the amount of
Dollars which is equivalent to the amount so expressed in such Alternative
Currency at the most favorable spot exchange rate determined by the
Administrative Agent to be available to it at the relevant time.
"Dollars" or "$" means, unless otherwise qualified, lawful currency of
the United States.
"EBITDA" means, with respect to the Borrower and its Restricted
Subsidiaries, for any period, (a) Net Income for such period plus (b) the sum of
the following to the extent deducted in the determination of Net Income for such
period: (i) income and franchise taxes, (ii) Interest Expense, (iii)
amortization, depreciation and other non-cash charges (including amortization of
goodwill, transaction expenses, covenants not to compete, compensation paid in
equity securities, other intangible assets and deferred charges), and (iv)
extraordinary expenses and non-recurring
5
expenses (including the non-cash expenses associated with prepayment of Debt)
minus (c) extraordinary gains. For purposes of calculating EBITDA:
(a) Pro forma effect will be given for acquisitions by the Borrower and
its Restricted Subsidiaries. Historical cash flows for the acquired assets will
be included in the cash flows of the Borrower and its Restricted Subsidiaries
for the portion of the calculation period, if any, that the assets were not
owned by the Borrower or its Restricted Subsidiaries, subject to receipt by the
Administrative Agent of financial information acceptable to the Administrative
Agent, in its reasonable discretion.
(b) Retroactive effect will be given for dispositions of assets by the
Borrower or its Restricted Subsidiaries by excluding all cash flows for assets
that are disposed of in determining EBITDA at any time after the date of
disposition.
"Eligible Assignee" means, with respect to any assignment of the
rights, interest and obligations of a Lender hereunder, a Person that is at the
time of such assignment (a) a commercial bank organized under, or which has a
branch or agency licensed under, the laws of the United States or any state
thereof, having combined capital and surplus in excess of $500,000,000, (b) a
finance company, insurance company or other financial institution which in the
ordinary course of business extends credit of the type extended hereunder and
that has total assets in excess of $500,000,000 or its equivalent in the
currency of such Person's jurisdiction of organization or operation, (c) already
a Lender hereunder (whether as an original party to this Agreement or as the
assignee of another Lender), (d) the successor (whether by transfer of assets,
merger or otherwise) to all or substantially all of the commercial lending
business of the assigning Lender, (e) any Affiliate of the assigning Lender that
is not a competitor of the Borrower and is engaged in the business of making
commercial loans in the ordinary course of its business, or (f) any other Person
that has been approved in writing as an Eligible Assignee by the Administrative
Agent and the Borrower, which approval by Borrower shall not be unreasonably
withheld or delayed. Notwithstanding the foregoing, if a Lender proposes to
assign its rights, interest and obligations hereunder to a Person that is at the
time of such assignment either (i) a competitor of the Borrower, or (ii) an
Affiliate of a competitor of the Borrower or a Person who is not engaged in the
business of making commercial loans in the ordinary course of its business, then
it shall be within the Borrower's sole discretion whether such Person is an
Eligible Assignee.
"Employee Benefit Plan" means any employee benefit plan within the
meaning of Section 3(3) of ERISA which (a) is maintained for employees of the
Borrower or any ERISA Affiliate or (b) has at any time within the preceding six
years been maintained for the employees of the Borrower or any current or former
ERISA Affiliate.
"EMU Event" means an event associated with economic and monetary union
in the European Community, including, without limitation, each (and any
combination) of the following:
(a) the introduction of, changeover to or operation of a single or
unified European currency (whether known as the euro or otherwise);
6
(b) the fixing of conversion rates between a member state's currency
and the new currency or between the currencies of member states;
(c) the substitution of that new currency for the Ecu as the unit of
account of the European Community;
(d) the introduction of that new currency as lawful in a member state;
(e) the withdrawal from legal tender of any currency that, before the
introduction of the new currency, was lawful currency in one of the member
states; or
(f) the disappearance or replacement of a relevant rate option or other
price source for the Ecu or the national currency of any member state, or the
failure of the agreed sponsor (or a successor sponsor) to publish or display a
relevant rate, index, price, page or screen.
"EMU Legislation" means legislative measures of the Council of European
Union for the introduction of, change over to or operation of a single European
currency (whether or not known as the euro), being in part the implementation of
the Third Stage of EMU.
"Environmental Laws" means any and all federal, state and local laws,
statutes, ordinances, rules, regulations, permits, licenses, approvals,
interpretations and orders of courts or Governmental Authorities, relating to
the protection of human health or the environment, including, but not limited
to, requirements pertaining to the manufacture, processing, distribution, use,
treatment, storage, disposal, transportation, handling, reporting, licensing,
permitting, investigation or remediation of Hazardous Materials. Environmental
Laws include, without limitation, the Comprehensive Environmental Response,
Compensation, and Liability Act (42 U.S.C. ss. 9601 et seq.), the Hazardous
Material Transportation Act (49 U.S.C. ss. 331 et seq.), the Resource
Conservation and Recovery Act (42 U.S.C. ss. 6901 et seq.), the Federal Water
Pollution Control Act (33 U.S.C. ss. 1251 et seq.), the Clean Air Act (42 U.S.C.
ss. 7401 et seq.), the Toxic Substances Control Act (15 U.S.C. ss. 2601 et
seq.), the Safe Drinking Water Act (42 U.S.C. ss. 300, et seq.), the
Environmental Protection Agency's regulations relating to underground storage
tanks (40 C.F.R. Parts 280 and 281), and the Occupational Safety and Health Act
(29 U.S.C. ss. 651 et seq.), analogous state statutes, and the rules and
regulations promulgated under the foregoing as such statutes are amended or
modified from time to time.
"ERISA" means the Employee Retirement Income Security Act of 1974, and
the rules and regulations thereunder, each as amended or modified from time to
time.
"ERISA Affiliate" means any Person which is a Restricted Subsidiary and
which, together with the Borrower, is treated as a single employer within the
meaning of Section 414(b), (c), (m) or (o) of the Code or Section 4001(b) of
ERISA. For purposes of the definition of "Termination Event," the definition of
"Multiemployer Plan" and clause (iv) of Section 11.1(m), however, the meaning of
"ERISA Affiliate" shall be determined by disregarding the phrase "which is a
Restricted Subsidiary and" in the immediately preceding sentence.
"euro" means the single currency of Participating Member States to be
introduced on the date of commencement of the Third Stage of EMU or on which
circumstances arise which (in the
7
opinion of the Administrative Agent) have substantially the same effect and
result in substantially the same consequences as the Third Stage of EMU.
"Eurodollar Reserve Percentage" means, for any day and with respect to
any Lender, the percentage (expressed as a decimal and rounded upwards, if
necessary, to the next higher 1/100th of 1%) which is in effect for such day as
prescribed by the Federal Reserve Board (or any successor) for determining the
maximum reserve requirement (including without limitation any basic,
supplemental or emergency reserves) for such Lender in respect of eurocurrency
liabilities or any similar category of liabilities for a member bank of the
Federal Reserve System in New York City.
"Event of Default" means any of the events specified in Section 11.1,
provided that any requirement for passage of time, giving of notice, or any
other condition, has been satisfied.
"Extensions of Credit" means, as to any Lender at any time, an amount
equal to the sum of (a) the aggregate principal amount of all Loans made by such
Lender then outstanding, and (b) such Lender's Commitment Percentage of the L/C
Obligations then outstanding.
"FDIC" means the Federal Deposit Insurance Corporation, or any
successor thereto.
"Federal Funds Rate" means the rate per annum (rounded upwards, if
necessary, to the next higher 1/100th of 1%) representing the daily effective
federal funds rate as quoted by the Administrative Agent and confirmed in
Federal Reserve Board Statistical Release H.15 (519) or any successor or
substitute publication selected by the Administrative Agent. If, for any reason,
such rate is not available, then "Federal Funds Rate" shall mean the average of
the quotations for the day for such transactions received by the Administrative
Agent from three brokers of national standing. Rates for weekends or holidays
shall be the same as the rate for the most immediate preceding Business Day.
"First Union" means First Union National Bank, a national banking
association, and its successors.
"Fiscal Year" means any fiscal year of the Borrower and its
Subsidiaries ending on December 31.
"GAAP" means generally accepted accounting principles, as recognized by
the American Institute of Certified Public Accountants or the Financial
Accounting Standards Board, consistently applied and maintained on a consistent
basis for the Borrower and its Subsidiaries throughout the period indicated and
consistent with the prior financial practice of the Borrower, provided, however,
that any accounting principle or practice required to be changed by the American
Institute of Certified Public Accounts or the Financial Accounting Standards
Board (or other appropriate board or committee of either) in order to continue
as a generally accepted accounting principle or practice may be so changed.
"Governmental Approvals" means all authorizations, consents, approvals,
licenses and exemptions of, registrations and filings with, and reports to, all
Governmental Authorities.
8
"Governmental Authority" means any nation, province, state or political
subdivision thereof, and any government or any Person exercising executive,
legislative, judicial, regulatory or administrative functions of or pertaining
to government, and any corporation or other entity owned or controlled, through
stock or capital ownership or otherwise, by any of the foregoing.
"Guaranty Agreement" means the collective reference to the Guaranty
Agreement of even date executed by the Subsidiary Guarantors party thereto in
favor of the Administrative Agent for the ratable benefit of the Agents and the
Lenders substantially in the form of Exhibit H, and each supplement to the
Guaranty Agreement delivered after the Closing Date pursuant to Section 8.12 as
each such agreement may be amended or supplemented.
"Hazardous Materials" means any substances or materials (a) which are
or become defined as hazardous wastes, hazardous substances, pollutants,
contaminants, chemical substances or mixtures or toxic substances under any
Environmental Law, (b) which are toxic, explosive, corrosive, flammable,
infectious, radioactive, carcinogenic, mutagenic or otherwise harmful to human
health or the environment and are or become regulated by any Governmental
Authority, (c) the presence of which require investigation or remediation under
any Environmental Law, (d) the discharge or emission or release of which
requires a permit or license under any Environmental Law or other Governmental
Approval, (e) which are deemed by a court of law or a Governmental Authority to
constitute a nuisance or a trespass or pose a health or safety hazard to persons
or neighboring properties, (f) which are materials consisting of underground or
aboveground storage tanks, whether empty, filled or partially filled with any
substance, or (g) which contain asbestos, polychlorinated biphenyls, urea
formaldehyde foam insulation, petroleum hydrocarbons, petroleum derived
substances or waste, crude oil, nuclear fuel, natural gas or synthetic gas.
"Hedging Agreement" means any agreement with respect to an interest
rate swap, collar, cap or floor or a forward rate agreement or other agreement
regarding the hedging of interest rate risk exposure executed in connection with
hedging the interest rate exposure of the Borrower under this Agreement, and any
confirming letter executed pursuant to such hedging agreement, all as amended or
modified.
"IFG" means Insignia Financial Group, Inc., a Delaware corporation.
"Interest Expense" means, with respect to the Borrower and its
Restricted Subsidiaries for any period, the gross interest expense (including
but without limitation interest expense attributable to Capital Leases) of the
Borrower and its Restricted Subsidiaries, all determined for such period on a
Consolidated basis in accordance with GAAP.
"Interest Period" shall have the meaning assigned thereto in Section
4.1(b).
"Issuing Lender" means First Union, in its capacity as issuer of any
Letter of Credit, or any successor thereto.
"L/C Commitment" means the lesser of (a) Ten Million Dollars
($10,000,000) or (b) the Aggregate Commitment.
9
"L/C Facility" means the letter of credit facility established pursuant
to Article III hereof.
"L/C Obligations" means, at any time, an amount equal to the sum of (a)
the aggregate undrawn and unexpired amount of the then outstanding Letters of
Credit and (b) the aggregate amount of drawings under Letters of Credit which
have not then been reimbursed pursuant to Section 3.5.
"L/C Participants" means the collective reference to all of the Lenders
other than the Issuing Lender.
"Xxxxxx" means Xxxxxx Commercial Paper Inc., a Delaware corporation,
and its successors.
"Lender" means each Person executing this Agreement as a Lender set
forth on the signature pages hereto and each Person that hereafter becomes a
party to this Agreement as a Lender pursuant to Section 13.8.
"Lender Addition and Acknowledgment Agreement" means each agreement
executed pursuant to Section 2.8 hereof by the Borrower and an existing Lender
or a Person not theretofore a Lender, as applicable, and acknowledged by the
Administrative Agent and each Subsidiary Guarantor, in the form attached hereto
as Exhibit J, providing for an increase in the Aggregate Commitment hereunder,
acknowledging that any Person not theretofore a Lender shall be a party hereto
and have the rights and obligations of a Lender hereunder, and setting forth the
Commitment of each Lender.
"Lending Office" means, with respect to any Lender, the office of such
Lender maintaining such Lender's Commitment Percentage of the Loans.
"Letters of Credit" shall have the meaning assigned thereto in Section
3.1.
"Leverage Ratio" means the ratio calculated pursuant to Section 9.1
hereof.
"LIBOR" means the rate of interest per annum determined on the basis of
the rate for deposits in Dollars in minimum amounts of at least $5,000,000 (or
the Alternative Currency Amount thereof with respect to a borrowing to be made
in an Alternative Currency) for a period equal to the applicable Interest Period
which appears on the Dow Xxxxx Markets screen 3750 at approximately 11:00 a.m.
(London time) two (2) Business Days prior to the first day of the applicable
Interest Period (rounded upward, if necessary, to the nearest one-sixteenth of
one percent (1/16%)). If, for any reason, such rate does not appear on Dow Xxxxx
Markets screen 3750, then "LIBOR" shall be determined by the Administrative
Agent to be the arithmetic average (rounded upward, if necessary, to the nearest
one-sixteenth of one percent (1/16%)) of the rate per annum at which deposits in
the Permitted Currency in which the applicable Loan is denominated would be
offered by five (5) first class banks in the London interbank market to the
entity which is the Administrative Agent (or the Administrative Agent's
Correspondent) approximately 11:00 a.m. (London time) two (2) Business Days
prior to the first day of the applicable Interest Period for a period equal to
such Interest Period and in an amount substantially equal to the amount of the
applicable Loan. Each calculation by the Administrative Agent of LIBOR shall be
conclusive and
10
binding for all purposes, absent manifest error.
"LIBOR Rate" means a rate per annum (rounded upwards, if necessary, to
the next higher one-sixteenth of one percent (1/16%) determined by the
Administrative Agent pursuant to the following formula:
LIBOR Rate = LIBOR
------------------------
1.00-Eurodollar Reserve Percentage
"LIBOR Rate Loan" means any Loan bearing interest at a rate based upon
the LIBOR Rate as provided in Section 4.1(a).
"Lien" means, with respect to any asset, any mortgage, lien, pledge,
charge, security interest or encumbrance of any kind in respect of such asset.
For the purposes of this Agreement, a Person shall be deemed to own subject to a
Lien any asset which it has acquired or holds subject to the interest of a
vendor or lessor under any conditional sale agreement, Capital Lease or other
title retention agreement relating to such asset.
"Loan" means any loan made to the Borrower pursuant to Section 2.1,
whether denominated in Dollars or in an Alternative Currency.
"Loan Documents" means, collectively, this Agreement, the Notes, the
Guaranty Agreement, the Pledge and Security Agreement, any Application, any
Hedging Agreement executed by the Borrower with any Lender or any Affiliate of
any Lender, and each other document, instrument and agreement executed and
delivered by the Borrower, its Subsidiaries or their counsel in connection with
this Agreement or otherwise referred to herein or contemplated hereby, all as
may be amended or supplemented from time to time.
"Management Agreement" means any agreement pursuant to which property
management, asset management, partnership management and/or related services are
provided to real estate owners, or any other agreement providing for service
fees to be payable to the Borrower or any Subsidiary thereof, including all of
such agreements hereafter acquired or entered into by any such Person, and any
renewals, extensions, amendments or modifications thereto.
"Material Adverse Effect" means, with respect to the Borrower and its
Restricted Subsidiaries, a material adverse effect on the properties, business,
operations or condition (financial or otherwise) of such Persons on a
Consolidated basis taken as a whole or the ability of any such Person to perform
the payment or other material obligations under the Loan Documents to which it
is a party or which would materially impair the validity or enforceability of
any of the Loan Documents against any Person party thereto, other than the
Agents or any of the Lenders or their Affiliates.
"Material Contract" means (a) any contract or other agreement, written
or oral, of the Borrower or any of its Restricted Subsidiaries involving
monetary liability of any such Person in an amount in excess of $1,000,000 per
annum, or (b) any other contract or agreement, written or oral, of the Borrower
or any of its Restricted Subsidiaries the failure to comply with which could
reasonably be expected to have a Material Adverse Effect.
11
"Maturity Date" shall have the meaning given thereto in Section 2.6.
"Moody's" means Xxxxx'x Investors Service, Inc.
"Multiemployer Plan" means a "multiemployer plan" as defined in Section
4001(a)(3) of ERISA to which the Borrower or any ERISA Affiliate is making, or
is accruing an obligation to make, contributions within the preceding six years.
"National Currency Unit" means the unit of currency (other than a euro
unit) of a Participating Member State.
"Net Cash Proceeds" means, with respect to any offering of capital
stock, the gross cash proceeds received by the Borrower or any of its
Subsidiaries therefrom less investment banking fees, legal fees, accountant
fees, underwriting discounts and commissions and other customary fees and
expenses actually incurred by the Borrower or any of its Subsidiaries in
connection with such offering.
"Net Income" means, with respect to the Borrower and its Restricted
Subsidiaries for any period, the Consolidated net income (or loss) of the
Borrower and its Restricted Subsidiaries for such period determined in
accordance with GAAP.
"Notes" means the separate promissory notes made by the Borrower
payable to the order of each Lender, substantially in the form of Exhibit A
hereto, evidencing the Revolving Credit Facility, and any amendments and
modifications thereto, any substitutes therefor, and any replacements,
restatements, renewals or extension thereof, in whole or in part; "Note" means
any of such Notes.
"Notice of Account Designation" shall have the meaning assigned thereto
in Section 2.2(b).
"Notice of Borrowing" shall have the meaning assigned thereto in
Section 2.2(a).
"Notice of Conversion/Continuation" shall have the meaning assigned
thereto in Section 4.2.
"Obligations" means, in each case, whether now in existence or
hereafter arising: (a) the principal of and interest on (including interest
accruing after the filing of any bankruptcy or similar petition) the Loans and
Reimbursement Obligations, (b) all payment and other obligations owing by the
Borrower to any Lender, an Affiliate of any Lender, or any Agent under any
Hedging Agreement and (c) all other fees and commissions (including attorney's
fees), charges, indebtedness, loans, liabilities, financial accommodations,
obligations, covenants and duties owing by the Borrower to any Lender or any
Agent under this Agreement, any Note or any of the other Loan Documents, of
every kind, nature and description, direct or indirect, absolute or contingent,
due or to become due, contractual or tortious, liquidated or unliquidated.
"Other Taxes" shall have the meaning assigned thereto in Section
4.11(b).
12
"Participating Member State" means a state which adopts a single
currency in accordance with the Treaty on European Union.
"PBGC" means the Pension Benefit Guaranty Corporation or any successor
agency.
"Pension Plan" means any Employee Benefit Plan, other than a
Multiemployer Plan, which is subject to the provisions of Title IV of ERISA or
Section 412 of the Code and which (a) is maintained for employees of the
Borrower or any ERISA Affiliates or (b) has at any time within the preceding six
years been maintained for the employees of the Borrower or any of their current
ERISA Affiliates.
"Person" means an individual, corporation, limited liability company,
partnership, association, trust, business trust, joint venture, joint stock
company, pool, syndicate, sole proprietorship, unincorporated organization,
Governmental Authority or any other form of entity or group thereof.
"Permitted Currency" means Dollars or any Alternative Currency, or each
such currency, as the context requires.
"Pledge and Security Agreement" means the collective reference to the
Pledge and Security Agreement of even date executed by the Borrower and certain
Subsidiaries thereof in favor of the Administrative Agent for the ratable
benefit of the Agents and the Lenders substantially in the form of Exhibit I,
and each Pledge and Security Agreement delivered after the Closing Date pursuant
to Section 8.12, as each such Agreement may be amended or supplemented, with the
consent of the Lenders.
"Prime Rate" means, at any time, the rate of interest per annum
publicly announced from time to time by First Union as its prime rate. The
parties hereto acknowledge that the rate announced publicly by First Union as
its Prime Rate is an index or base rate and shall not necessarily be its lowest
or best rate charged to its customers or other banks.
"Register" shall have the meaning assigned thereto in Section 13.8(d).
"Reimbursement Obligation" means the obligation of the Borrower to
reimburse the Issuing Lender pursuant to Section 3.5 for amounts drawn under
Letters of Credit.
"Required Lenders" means, at any date, any combination of holders of
greater than sixty-six and two-thirds percent (66-2/3%) of the aggregate unpaid
principal amount of the Notes, exclusive of Notes held by Defaulting Lenders, or
if no amounts are outstanding under the Notes, any combination of Lenders whose
Commitment Percentages aggregate greater than sixty-six and two-thirds percent
(66-2/3%), if the Commitment of each Defaulting Lender were excluded from the
Aggregate Commitment.
"Restricted Subsidiary" means any Subsidiary of the Borrower other than
an Unrestricted Subsidiary.
13
"Revolving Credit Facility" means the revolving credit facility
established pursuant to Article II hereof.
"S&P" means Standard & Poor's Ratings Group, a division of XxXxxx-Xxxx
Companies, Inc.
"Solvent" means, as to the Borrower and its Restricted Subsidiaries on
a particular date, that any such Person (a) has capital sufficient to carry on
its business and transactions and all business and transactions in which it is
about to engage and is able to pay its debts as they mature and (b) is not
"Insolvent" as defined under the United States Bankruptcy Code or any applicable
State insolvency law.
"Subordinated Debt" means the collective reference to all Debt of the
Borrower and any Restricted Subsidiary which (a) has a scheduled maturity date
more than one year after the Maturity Date, (b) is not subject to any scheduled
amortization or mandatory redemption feature of any kind (other than a mandatory
redemption upon the occurrence of an event which constitutes an Event of Default
hereunder), and (c) is subordinated with respect to payment, remedies and
covenants to the Obligations and (with respect to Debt which is incurred by the
Borrower and its Restricted Subsidiaries after the date hereof) otherwise
subordinated thereto to the reasonable satisfaction of the Agents and Required
Lenders.
"Subsidiary" means, as to any Person, any corporation, partnership or
other entity of which more than fifty percent (50%) of the outstanding capital
stock or other ownership interests having ordinary voting power to elect a
majority of the board of directors or other managers of such corporation,
partnership or other entity is at the time, directly or indirectly, owned by
such Person (irrespective of whether, at such time, capital stock or other
ownership interest of any other class or classes shall have or might have voting
power by reason of the happening of any contingency). Unless otherwise
qualified, references to "Subsidiary" or "Subsidiaries" herein shall refer to
those of the Borrower.
"Subsidiary Guarantor" means each Restricted Subsidiary party to a
Guaranty Agreement.
"Syndication Agent" means Xxxxxx in its capacity as Syndication Agent.
"Taxes" shall have the meaning assigned thereto in Section 4.11(a).
"Termination Date" means the date on which the Credit Facility
terminates pursuant to Section 2.6.
"Termination Event" means: (a) a "Reportable Event" described in
Section 4043 of ERISA for which notice has not been waived which results in a
Material Adverse Effect, or (b) the withdrawal of the Borrower or any ERISA
Affiliate from a Pension Plan during a plan year in which it was a "substantial
employer" as defined in Section 4001(a)(2) of ERISA which results in a Material
Adverse Effect, or (c) the institution of proceedings to terminate, or the
appointment of a trustee with respect to, any Pension Plan by the PBGC which
results in a Material Adverse Effect, or (d) any other event or condition which
would constitute grounds under Section 4042(a) of ERISA for the termination of,
or the appointment of a trustee to administer, any Pension Plan,
14
or (e) the imposition of a Lien pursuant to Section 412 of the Code or Section
302 of ERISA which results in a Material Adverse Effect, or (f) any event or
condition which results in the reorganization or insolvency of a Multiemployer
Plan under Sections 4241 or 4245 of ERISA which results in a Material Adverse
Effect, or (g) any event or condition which results in the termination of a
Multiemployer Plan under Section 4041A of ERISA or the institution by PBGC of
proceedings to terminate a Multiemployer Plan under Section 4042 of ERISA which
results in a Material Adverse Effect.
"Third Stage of EMU" means the third stage of Economic and Monetary
Union as contemplated by the Treaty on European Union (at the date of this
Agreement expected to be January 1, 1999).
"Total Capitalization" means, at any date of determination, without
duplication, the sum of Total Debt (determined with respect to the Borrower and
its Restricted Subsidiaries) plus Consolidated Net Worth, each as of such date.
"Total Debt" means, at any date of determination, the aggregate amount
of Debt of the Borrower and its Restricted Subsidiaries determined on a
Consolidated basis.
"Treaty on European Union" means the treaty establishing the European
Community signed in Rome on March 25, 1957, as amended from time to time.
"UCC" means the Uniform Commercial Code as in effect in the State of
New York, as amended, restated or otherwise modified.
"Uncontrolled Co-Investment Entity" means any Co-Investment Entity
which is not a Controlled Co-Investment Entity.
"Uniform Customs" means the Uniform Customs and Practice for
Documentary Credits (1993 Revision), International Chamber of Commerce
Publication No. 500.
"United States" means the United States of America.
"Unrestricted Subsidiary" means any Subsidiary of the Borrower and of
any other Subsidiary whose Debt and Contingent Obligations are non-recourse to
the Borrower and its other Restricted Subsidiaries and which has been
designated, in writing, by the Borrower as such (without such designation having
been rescinded by the Borrower). As of the Closing Date, the Unrestricted
Subsidiaries are those set forth as such on Schedule 6.1(a).
SECTION 1.2 General. Unless otherwise specified, a reference in this
Agreement to a particular section, subsection, Schedule or Exhibit is a
reference to that section, subsection, Schedule or Exhibit of this Agreement.
Wherever from the context it appears appropriate, each term stated in either the
singular or plural shall include the singular and plural, and pronouns stated in
the masculine, feminine or neuter gender shall include the masculine, the
feminine and the neuter. Any reference herein to "Charlotte time" shall refer to
the applicable time of day in Charlotte, North Carolina.
15
SECTION 1.3 Other Definitions and Provisions.
(a) Use of Capitalized Terms. Unless otherwise defined therein, all
capitalized terms defined in this Agreement shall have the defined meanings when
used in this Agreement, the Notes and the other Loan Documents or any
certificate, report or other document made or delivered pursuant to this
Agreement.
(b) Miscellaneous. The words "hereof", "herein" and "hereunder" and
words of similar import when used in this Agreement shall refer to this
Agreement as a whole and not to any particular provision of this Agreement.
ARTICLE II
CREDIT FACILITY
SECTION 2.1 Loans and Maximum Availability. Subject to the terms and
conditions of this Agreement, each Lender severally commits to make Loans to the
Borrower from time to time from the Closing Date through the Termination Date as
requested by the Borrower in accordance with the terms of Section 2.2; provided,
that (a) the Dollar Amount of the aggregate principal amount of all outstanding
Loans (after giving effect to any amount requested and funded and the use of the
proceeds thereof) shall not exceed the Aggregate Commitment less the sum of all
outstanding L/C Obligations, (b) the Dollar Amount of the aggregate principal
amount of all outstanding Alternative Currency Loans (after giving effect to any
amount requested and funded and the use of the proceeds thereof) shall not
exceed the Alternative Currency Commitment, and (c) the Dollar Amount of the
aggregate principal amount of outstanding Loans from any Lender to the Borrower
shall not at any time exceed such Lender's Commitment less an amount equal to
such Lender's Commitment Percentage of the outstanding L/C Obligations. Each
Loan by a Lender shall be in a principal amount equal to such Lender's
Commitment Percentage of the aggregate principal amount of Loans requested on
such occasion. Loans to be made in an Alternative Currency shall be funded in an
amount equal to the Alternative Currency Amount of such Loan. Subject to the
terms and conditions hereof, the Borrower may borrow, repay and reborrow Loans
hereunder until the Termination Date.
SECTION 2.2 Procedure for Advances of Loans.
(a) Requests for Borrowing. The Borrower shall give the Administrative
Agent irrevocable prior written notice in the form attached hereto as Exhibit B
(a "Notice of Borrowing") not later than 12:00 Noon (Charlotte time) (i) on the
same Business Day as each Base Rate Loan, and (ii) at least three (3) Business
Days before each LIBOR Rate Loan denominated in Dollars and not later than 11:00
a.m. (the time of the Administrative Agent's Correspondent) at least four (4)
Business Days before each LIBOR Rate Loan denominated in an Alternative
Currency, of its intention to borrow, specifying (A) the date of such borrowing,
which shall be a Business Day, (B) whether the Loan shall be denominated in
Dollars or an Alternative Currency, (C) if denominated in Dollars, whether the
Loans are to be LIBOR Rate Loans or Base Rate Loans, (D) the amount of such
borrowing, which shall not exceed an amount equal to the amount of the Aggregate
16
Commitment or Alternative Currency Commitment, as applicable, then available to
the Borrower, and shall be, (x) with respect to Base Rate Loans in an aggregate
principal amount of $2,500,000 or a whole multiple of $500,000 in excess
thereof, (y) with respect to LIBOR Rate Loans denominated in Dollars, in an
aggregate principal amount of $5,000,000 or a whole multiple of $1,000,000 in
excess thereof and (z) with respect to LIBOR Rate Loans denominated in an
Alternative Currency, in an aggregate principal amount of $2,000,000 or a whole
multiple of $500,000 in excess thereof, and (E) in the case of a LIBOR Rate
Loan, the duration of the Interest Period applicable thereto. Notices received
after 12:00 Noon (Charlotte time) (or 11:00 a.m. (the time of the Administrative
Agent's Correspondent) with respect to Alternative Currency Loans) shall be
deemed received on the next Business Day. The Administrative Agent shall
promptly notify the Lenders of each Notice of Borrowing.
(b) Disbursement of Loans Denominated in Dollars. Not later than 3:00
p.m. (Charlotte time) on the proposed borrowing date for any Loan denominated in
Dollars, each Lender will make available to the Administrative Agent, for the
account of the Borrower, at the office of the Administrative Agent in Dollars in
funds immediately available to the Administrative Agent, such Lender's
Commitment Percentage of the requested Loan to be made on such borrowing date.
The Borrower hereby irrevocably authorizes the Administrative Agent to disburse
the proceeds of each borrowing requested pursuant to this Section 2.2 in
immediately available funds by crediting such proceeds to a deposit account of
the Borrower identified in the most recent notice substantially in the form of
Exhibit E hereto (a "Notice of Account Designation") delivered by the Borrower
to the Administrative Agent or by wire transfer to such account as may be agreed
upon by the Borrower and the Administrative Agent from time to time. Subject to
Section 4.7 hereof, the Administrative Agent shall not be obligated to disburse
the amounts to be funded by a Lender pursuant to this Section 2.2 to the extent
that such Lender has not made such amounts available to the Administrative
Agent.
(c) Disbursement of Alternative Currency Loans. Not later than 11:00
a.m. (the time of the Administrative Agent's Correspondent) on or before the
proposed borrowing date for any Alternative Currency Loan, each Lender will make
available to the Administrative Agent for the account of the Borrower at the
office of the Administrative Agent's Correspondent, in the requested Alternative
Currency and in funds immediately available to the Administrative Agent, such
Lender's Commitment Percentage of the Alternative Currency Amount of such
requested borrowing. The Borrower hereby irrevocably authorizes the
Administrative Agent to disburse the proceeds of each borrowing requested
pursuant to this Section 2.2 in immediately available funds by crediting or
wiring such proceeds to the deposit account of the Borrower identified in the
most recent Notice of Account Designation delivered by the Borrower to the
Administrative Agent or as may be otherwise agreed upon by the Borrower and the
Administrative Agent from time to time. Subject to Section 4.7, the
Administrative Agent shall not be obligated to disburse the portion of the
proceeds of any Loan requested pursuant to this Section 2.2 to the extent that
any Lender has not made available to the Administrative Agent its Commitment
Percentage of such Loan.
17
SECTION 2.3 Repayment of Loans.
(a) Repayment on Termination Date. The Borrower shall repay the
outstanding principal amount of all Loans in full, together with all accrued but
unpaid interest thereon, on the Termination Date.
(b) Mandatory Repayment of Excess Loans; Maximum Availability.
(i) Aggregate Commitment. If at any time (as determined by the
Administrative Agent under Section 2.3(b)(iv)), and for any reason, the
aggregate principal Dollar Amount of all outstanding Loans exceeds the
Aggregate Commitment less all outstanding L/C Obligations, the Borrower
shall (A) first, if (and to the extent) necessary to eliminate such
excess, immediately repay outstanding Base Rate Loans by the Dollar
Amount of such excess (and/or reduce any pending request for a Base
Rate Loan on such day by the Dollar Amount of such excess) and (B)
second, if (and to the extent) necessary to eliminate such excess,
immediately repay LIBOR Rate Loans (and/or reduce any pending requests
for a borrowing or continuation or conversion of such Loans submitted
in respect of such Loans on such day) by the Dollar Amount of any
remaining excess.
(ii) Excess Alternative Currency Loans. If at any time (as
determined by the Administrative Agent under Section 2.3(b)(iv)) and
for any reason the Dollar Amount of the aggregate outstanding principal
amount of all outstanding Alternative Currency Loans exceeds the
Alternative Currency Commitment, such excess shall be immediately
repaid, in the currency in which such Alternative Currency Loan or
Alternative Currency Loans were initially funded, by the Borrower to
the Administrative Agent for the account of the Lenders; provided that
the Borrower shall not be required to repay such excess if and to the
extent the excess is due solely to currency fluctuations and does not
exceed 5% of the Alternative Currency Commitment.
(iii) Excess L/C Obligations. If at any time and for any
reason the aggregate principal amount of the L/C Obligations exceeds
the L/C Commitment, then the Borrower shall deposit an amount equal to
such excess in accordance with Section 11.2(b).
(iv) Compliance and Payments. The Borrower's compliance with
this Section 2.3(b) shall be tested from time to time by the
Administrative Agent at its sole discretion, but in any event on each
day an interest payment is due under Section 4.1(e). Each such
repayment pursuant to this Section 2.3(b) shall be accompanied by any
amount required to be paid pursuant to Section 4.9 hereof.
(c) Optional Repayments. The Borrower may at any time and from time to
time repay the Loans, in whole or in part, upon at least four (4) Business Days'
irrevocable notice to the Administrative Agent with respect to LIBOR Rate Loans
denominated in an Alternative Currency, upon at least three (3) Business Days'
irrevocable notice to the Administrative Agent with respect to LIBOR Rate Loans
denominated in Dollars and one (1) Business Day's irrevocable notice with
respect to Base Rate Loans, in the form attached hereto Exhibit D (a "Notice of
Repayment"), specifying the date and amount of repayment and whether the
repayment is of LIBOR Rate Loans denominated in an Alternative Currency, LIBOR
Rate Loans denominated in Dollars, Base Rate
18
Loans, or a combination thereof, and, if of a combination thereof, the amount
allocable to each. Upon receipt of such notice, the Administrative Agent shall
promptly notify each Lender. If any such notice is given, the amount specified
in such notice shall be due and payable on the date set forth in such notice.
Partial repayments shall be in an aggregate amount of $2,500,000 or a whole
multiple of $500,000 in excess thereof with respect to Base Rate Loans and
$5,000,000 or a whole multiple of $1,000,000 in excess thereof with respect to
LIBOR Rate Loans; provided, that with respect to Alternative Currency Loans,
partial repayments shall be in an Alternative Currency Amount equal to
$2,000,000 or a whole multiple of $500,000 in excess thereof.
(d) Limitation on Repayment of LIBOR Rate Loans. Any repayment of any
LIBOR Rate Loan on any day other than on the last day of the Interest Period
applicable thereto shall be subject to the payment of amounts required to be
paid pursuant to Section 4.9 hereof.
SECTION 2.4 Notes. Each Lender's Loans and the obligation of the
Borrower to repay such Loans shall be evidenced by a Note executed by the
Borrower payable to the order of such Lender representing the Borrower's
obligation to pay such Lender's Commitment or, if less, the aggregate unpaid
principal amount of all Loans made and to be made by such Lender to the Borrower
hereunder, plus interest and all other fees, charges and other amounts due
thereon. Each Note shall bear interest on the unpaid principal amount thereof at
the applicable interest rate per annum specified in Section 4.1.
SECTION 2.5 Permanent Reduction of the Aggregate Commitment.
(a) The Borrower shall have the right at any time and from time to
time, upon at least three (3) Business Days' prior written notice to the
Administrative Agent, to permanently reduce, in whole at any time or in part
from time to time, without premium, the Aggregate Commitment in an aggregate
principal amount not less than $1,000,000 or any whole multiple of $1,000,000 in
excess thereof. Upon receipt of such notice, the Administrative Agent shall
promptly notify each Lender. To the extent that the Aggregate Commitment is
reduced to an amount below the Alternative Currency Commitment, there shall be a
corresponding permanent reduction of the Alternative Currency Commitment, to the
amount of the Aggregate Commitment as so reduced.
(b) Each permanent reduction permitted or required pursuant to this
Section 2.5 shall be accompanied by a payment of principal sufficient to reduce
the aggregate outstanding Extensions of Credit of the Lenders to an amount not
in excess of the Aggregate Commitment as so reduced and if the Aggregate
Commitment as so reduced is less than the aggregate amount of all outstanding
Letters of Credit, the Borrower shall be required to deposit in a cash
collateral account opened by the Administrative Agent an amount equal to the
excess of the aggregate then undrawn and unexpired amount of such Letters of
Credit over the Aggregate Commitment as so reduced. Any reduction of the
Aggregate Commitment to zero shall be accompanied by payment of all outstanding
Obligations (and furnishing of cash collateral satisfactory to the
Administrative Agent for all L/C Obligations) and shall result in the
termination of the Commitments and Credit Facility. Such cash collateral shall
be applied in accordance with Section 11.2(b). If the reduction of the Aggregate
Commitment requires the repayment of any LIBOR Rate Loan, such repayment shall
be accompanied by any amount required to be paid pursuant to Section 4.9 hereof.
19
SECTION 2.6 Termination of Credit Facility. The Credit Facility shall
terminate on the earliest of (a) the third anniversary of the Closing Date (the
"Maturity Date"), (b) the date of termination by the Borrower pursuant to
Section 2.5(a) and (c) the date of termination by the Administrative Agent on
behalf of the Lenders pursuant to Section 11.2(a).
SECTION 2.7 Use of Proceeds. The Borrower shall use the proceeds of the
Loans for working capital and other general corporate requirements of the
Borrower and its Subsidiaries, including the payment of certain fees and
expenses incurred in connection with the transactions contemplated hereby.
SECTION 2.8 Increase in Aggregate Commitment. So long as no Default or
Event of Default shall have occurred and be continuing, at any time prior to the
Termination Date, the Borrower shall have the right from time to time upon not
less than thirty (30) days prior written notice to the Administrative Agent to
increase the Aggregate Commitment; provided, that in no event shall the
Aggregate Commitment be increased to an amount greater than $200,000,000;
provided, further, that:
(a) Any increase in the Aggregate Commitment which is
accomplished by increasing the Commitment of any Lender or Lenders who
are at the time of such increase party to this Agreement (which Lender
or Lenders shall consent to such increase in their sole and absolute
discretion) shall be accomplished as follows: (i) this Agreement will
be amended by the Borrower, the Administrative Agent and those
Lender(s) whose Commitment(s) is or are being increased (but without
any requirement that the consent of the Required Lenders be obtained)
to reflect the revised Commitment amounts of each of the Lenders, (ii)
the Administrative Agent will deliver an updated Schedule 1.1(a) to the
Borrower, the Issuing Lender and each of the Lenders reflecting the
revised Commitment amount and Commitment Percentage of each of the
Lenders, (iii) the outstanding Loans and Commitment Percentages of L/C
Obligations will be reallocated on the effective date of such increase
among the Lenders in accordance with their revised Commitment
Percentages (and the Lenders agree to make all payments and adjustments
necessary to effect the reallocation and the Borrower shall pay any and
all costs required pursuant to Section 4.9 in connection with such
reallocation as if such reallocation were a prepayment) and (iv) the
Borrower will deliver new Note(s) to the Lender or Lenders whose
Commitment(s) is or are being increased reflecting the revised
Commitment amount of such Lender(s); and
(b) Any increase in the Aggregate Commitment which is
accomplished by addition of a new Lender under the Agreement shall be
accomplished as follows: (i) such new Lender shall be an Eligible
Assignee and shall be subject to the consent of the Administrative
Agent, which consent shall not be unreasonably withheld, (ii) this
Agreement will be amended by the Borrower, the Administrative Agent and
by the party becoming an additional Lender hereunder (but without any
requirement that the consent of the Required Lenders be obtained) to
reflect the addition of such party as a Lender hereunder, (iii) the
Administrative Agent will deliver an updated Schedule 1.1(a) to the
Borrower, the Issuing Lender and each of the Lenders reflecting the
revised Commitment amounts and Commitment Percentages of each of the
Lenders, (iv) the outstanding Loans and Commitment Percentages of L/C
Obligations will be reallocated on the effective date
20
of such increase among the Lenders in accordance with their revised
Commitment Percentages (and the Lenders agree to make all payments and
adjustments necessary to effect the reallocation and the Borrower shall
pay any and all costs required pursuant to Section 4.9 in connection
with such reallocation as if such reallocation were a prepayment) and
(v) the Borrower will deliver a Note to such party.
ARTICLE III
LETTER OF CREDIT FACILITY
SECTION 3.1 L/C Commitment. Subject to the terms and conditions hereof,
the Issuing Lender, in reliance on the agreements of the other Lenders set forth
in Section 3.4(a), agrees to issue standby letters of credit ("Letters of
Credit") for the account of the Borrower on any Business Day from the Closing
Date through but not including the Termination Date in such form as may be
approved from time to time by the Issuing Lender; provided, that the Issuing
Lender shall have no obligation to issue any Letter of Credit if, after giving
effect to such issuance, (a) the L/C Obligations would exceed the lesser of (i)
the L/C Commitment or (ii) the Aggregate Commitment less the sum of the Dollar
Amount of the aggregate principal amount of all other Extensions of Credit or
(b) the Available Commitment of any Lender would be less than zero. Each Letter
of Credit shall (i) be denominated in Dollars, (ii) be a standby letter of
credit issued to support obligations of the Borrower or any of its Restricted
Subsidiaries, contingent or otherwise, (iii) expire no later than one (1) year
from the date of issuance thereof; provided, that in no case shall such
expiration date be later than five (5) Business Days prior to the Termination
Date, and (iv) be subject to the laws of the State of North Carolina and, to the
extent not inconsistent therewith, the Uniform Customs. References herein to
"issue" and derivations thereof with respect to Letters of Credit shall also
include extensions or modifications of any existing Letters of Credit, unless
the context otherwise requires.
SECTION 3.2 Procedure for Issuance of Letters of Credit. The Borrower
may from time to time request that the Issuing Lender issue a Letter of Credit
by delivering to the Issuing Lender at the Administrative Agent's Office an
Application therefor, completed to the satisfaction of the Issuing Lender, and
such other certificates, documents and other papers and information as the
Issuing Lender may request. Upon receipt of any Application, the Issuing Lender
shall process such Application and the certificates, documents and other papers
and information delivered to it in connection therewith in accordance with its
customary procedures and shall, subject to Section 3.1 and Article V hereof,
promptly but no later than five (5) Business Days from the date of its receipt
of the Application therefor, issue the Letter of Credit requested thereby (but
in no event shall the Issuing Lender be required to issue any Letter of Credit
earlier than three (3) Business Days after its receipt of the Application
therefor and all such other certificates, documents and other papers and
information relating thereto) by issuing the original of such Letter of Credit
to the beneficiary thereof or as otherwise may be agreed by the Issuing Lender
and the Borrower. The Issuing Lender shall furnish to the Borrower a copy of
such Letter of Credit and furnish to each Lender a copy of such Letter of Credit
and the amount of each Lender's L/C Participation therein, all promptly
following the issuance of such Letter of Credit.
21
SECTION 3.3 Commissions and Other Charges.
(a) The Borrower shall pay to the Administrative Agent, for the account
of the Issuing Lender and the L/C Participants, a letter of credit commission
with respect to each Letter of Credit in an amount equal to the face amount of
such Letter of Credit multiplied by the Applicable Margin for LIBOR Rate Loans
(determined on a per annum basis). Such commission shall be payable quarterly in
arrears on the last Business Day of each quarter and on the Termination Date.
(b) In addition to the foregoing commission, the Borrower shall pay to
the Administrative Agent, for the account of the Issuing Lender, an issuance fee
in an amount equal to the face amount of each Letter of Credit multiplied by
0.125%. Such issuance fee shall be payable on the date of issuance thereof and
on the date of each renewal, if any, thereof.
(c) In addition to the foregoing commissions, the Borrower shall pay or
reimburse the Issuing Lender for such normal and customary costs and expenses as
are incurred or charged by the Issuing Lender in issuing, effecting payment
under, amending or otherwise administering any Letter of Credit; provided, that
from time to time, as requested by the Borrower, the Administrative Agent will
provide the Borrower with information pertaining to the amount of such costs and
expenses.
(d) The Administrative Agent shall, promptly following its receipt
thereof, distribute to the Issuing Lender and the L/C Participants all
commissions received by the Administrative Agent in accordance with their
respective Commitment Percentages.
SECTION 3.4 L/C Participations.
(a) The Issuing Lender irrevocably agrees to grant and hereby grants to
each L/C Participant, and, to induce the Issuing Lender to issue Letters of
Credit hereunder, each L/C Participant irrevocably agrees to accept and purchase
and hereby accepts and purchases from the Issuing Lender, on the terms and
conditions hereinafter stated, for such L/C Participant's own account and risk
an undivided interest equal to such L/C Participant's Commitment Percentage in
the Issuing Lender's obligations and rights under and in respect of each Letter
of Credit issued hereunder and the amount of each draft paid by the Issuing
Lender thereunder. Each L/C Participant unconditionally and irrevocably agrees
with the Issuing Lender that, if a draft is paid under any Letter of Credit for
which the Issuing Lender is not reimbursed in full by the Borrower in accordance
with the terms of this Agreement, including, without limitation, from the
proceeds of a Base Rate Loan pursuant to Section 3.5, such L/C Participant shall
pay to the Issuing Lender upon demand at the Issuing Lender's address for
notices specified herein an amount equal to such L/C Participant's Commitment
Percentage of the amount of such draft, or any part thereof, which is not so
reimbursed.
(b) Upon becoming aware of any amount required to be paid by any L/C
Participant to the Issuing Lender pursuant to Section 3.4(a) in respect of any
unreimbursed portion of any payment made by the Issuing Lender under any Letter
of Credit, the Issuing Lender shall notify each L/C Participant of the amount
and due date of such required payment and such L/C Participant shall pay to the
Issuing Lender the amount specified on the applicable due date. If any such
amount is paid to the Issuing Lender after the date such payment is due, such
L/C Participant
22
shall pay to the Issuing Lender on demand, in addition to such amount, interest
on such amount at a rate equal to the daily average Federal Funds Rate as
determined by the Administrative Agent during the period from and including the
date such payment is due to the date on which such payment is immediately
available to the Issuing Lender. A certificate of the Issuing Lender with
respect to any amounts owing under this Section 3.4(b) shall be conclusive in
the absence of manifest error. With respect to payment to the Issuing Lender of
the unreimbursed amounts described in this Section 3.4(b), if the L/C
Participants receive notice that any such payment is due (A) prior to 1:00 p.m.
(Charlotte time) on any Business Day, such payment shall be due that Business
Day, and (B) after 1:00 p.m. (Charlotte time) on any Business Day, such payment
shall be due on the following Business Day.
(c) Whenever, at any time after the Issuing Lender has made payment
under any Letter of Credit and has received from any L/C Participant its
Commitment Percentage of such payment in accordance with this Section 3.4, the
Issuing Lender receives any payment related to such Letter of Credit (whether
directly from the Borrower or otherwise), or any payment of interest on account
thereof, the Issuing Lender will distribute to such L/C Participant its pro rata
share thereof; provided, that in the event that any such payment received by the
Issuing Lender shall be required to be returned by the Issuing Lender, such L/C
Participant shall return to the Issuing Lender the portion thereof previously
distributed by the Issuing Lender to it. With respect to any distribution by the
Issuing Lender of any payment described in this Section 3.4(c), if the Issuing
Lender receives such payment prior to 1:00 p.m. (Charlotte time) on any Business
Day, such payment shall be distributed to such L/C Participant on that Business
Day, and if received after 1:00 p.m. (Charlotte time) on any Business Day, such
distribution will be made on the following Business Day.
SECTION 3.5 Reimbursement Obligation of the Borrower. The Borrower
agrees to reimburse the Issuing Lender on each date on which the Issuing Lender
notifies the Borrower of the date and amount of a draft paid under any Letter of
Credit for the amount of (a) such draft so paid and (b) any taxes, fees, charges
or other costs or expenses incurred by the Issuing Lender in connection with
such payment. Each such payment shall be made to the Issuing Lender at its
address for notices specified herein in Dollars and in immediately available
funds. Interest shall be payable on any and all amounts remaining unpaid by the
Borrower under this Article III from the date such amounts become payable
(whether at stated maturity, by acceleration or otherwise) until payment in full
at the rate which would be payable on any outstanding Base Rate Loans which were
then overdue. If the Borrower fails to timely reimburse the Issuing Lender on
the date the Borrower receives the notice referred to in this Section 3.5, the
Borrower shall be deemed to have timely given a Notice of Borrowing hereunder to
the Administrative Agent requesting the Lenders to make a Base Rate Loan on such
date in an amount equal to the amount of such drawing and, regardless of whether
or not the conditions precedent specified in Article V have been satisfied, the
Lenders shall make Base Rate Loans in such amount, the proceeds of which shall
be applied to reimburse the Issuing Lender for the amount of the related drawing
and costs and expenses. Notwithstanding the foregoing, nothing in this Section
3.5 shall obligate the Lenders to make such Base Rate Loans if the making of
such Base Rate Loans would violate the automatic stay under federal bankruptcy
laws, and no Lender shall be required to fund more than its Commitment
Percentage of any draw under any Letter of Credit.
23
SECTION 3.6 Obligations Absolute. The Borrower's obligations under this
Article III (including without limitation the Reimbursement Obligation) shall be
absolute and unconditional under any and all circumstances and irrespective of
any set-off, counterclaim or defense to payment which the Borrower may have or
have had against the Issuing Lender, any L/C Participant or any beneficiary of a
Letter of Credit. The Borrower also agrees with the Issuing Lender that the
Issuing Lender and the L/C Participants shall not be responsible for, and the
Borrower's Reimbursement Obligation under Section 3.5 shall not be affected by,
among other things, the validity or genuineness of documents or of any
endorsements thereon, even though such documents shall in fact prove to be
invalid, fraudulent or forged, or any dispute between or among the Borrower and
any beneficiary of any Letter of Credit or any other party to which such Letter
of Credit may be transferred or any claims whatsoever of the Borrower against
any beneficiary of such Letter of Credit or any such transferee. The Issuing
Lender and the L/C Participants shall not be liable for any error, omission,
interruption or delay in transmission, dispatch or delivery of any message or
advice, however transmitted, in connection with any Letter of Credit, except, in
respect of the Issuing Lender, for errors or omissions caused by the Issuing
Lender's gross negligence or willful misconduct. The Borrower agrees that any
action taken or omitted by the Issuing Lender under or in connection with any
Letter of Credit or the related drafts or documents, if done in the absence of
gross negligence or willful misconduct and in accordance with the standards of
care specified in the UCC and, to the extent not inconsistent therewith, the
Uniform Customs shall be binding on the Borrower and shall not result in any
liability of the Issuing Lender to the Borrower. The responsibility of the
Issuing Lender to the Borrower in connection with any draft presented for
payment under any Letter of Credit shall, in addition to any payment obligation
expressly provided for in such Letter of Credit, be limited to determining that
the documents (including each draft) delivered under such Letter of Credit in
connection with such presentment are in conformity with such Letter of Credit.
SECTION 3.7 Effect of Application. To the extent that any provision of
any Application related to any Letter of Credit is inconsistent with the
provisions of this Article III, the provisions of this Article III shall apply.
Not in limitation of the foregoing, any provision contained in any Application
or other certificate, document or other paper provided by the Borrower in
connection with an Application (collectively, the "Application Documents") which
purports to convey to the Issuing Bank or any of its affiliates a Lien as
security for any obligations of the Borrower in connection therewith shall be
void and of no force and effect. Further, notwithstanding any provision of an
Application Document specifying events of default, an event of default shall be
deemed to have occurred under an Application Document only upon the occurrence
of an Event of Default. Accordingly, any provision contained in any of the
Application Documents providing for or specifying events of default shall be of
no force and effect.
24
ARTICLE IV
GENERAL LOAN PROVISIONS
SECTION 4.1 Interest.
(a) Interest Rate Options. Subject to the provisions of this Section
4.1, at the election of the Borrower, (i) the aggregate principal balance of the
Loans or any portion thereof, denominated in Dollars, shall bear interest at (A)
the Base Rate plus the Applicable Margin or (B) the LIBOR Rate plus the
Applicable Margin and (ii) the Loans or any portion thereof denominated in an
Alternative Currency, shall bear interest at the LIBOR Rate plus the Applicable
Margin; provided that the LIBOR Rate shall not be available until three (3)
Business Days after the Closing Date (or four (4) Business Days after the
Closing Date with respect to each Loan denominated in an Alternative Currency).
The Borrower shall select the rate of interest and Interest Period, if any,
applicable to any Loan at the time a Notice of Borrowing is given pursuant to
Section 2.2 or at the time a Notice of Conversion/Continuation is given pursuant
to Section 4.2. Any Loan or any portion thereof as to which the Borrower has not
duly specified an interest rate as provided herein shall be deemed a Base Rate
Loan denominated in Dollars.
(b) Interest Periods. In connection with each LIBOR Rate Loan, the
Borrower, by giving notice at the times described in Section 4.1(a), shall elect
an interest period (each, an "Interest Period") to be applicable to such Loan,
which Interest Period shall be a period of one (1), two (2), three (3), or six
(6) months; provided that:
(i) each Interest Period shall commence on the date of advance
of or conversion to any LIBOR Rate Loan and, in the case of immediately
successive Interest Periods, each successive Interest Period shall
commence on the date on which the next preceding Interest Period
expires;
(ii) if any 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;
(iii) 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 end on the last Business Day of the relevant calendar
month at the end of such Interest Period;
(iv) no Interest Period shall be permitted to extend beyond
the Termination Date; and
(v) there shall be no more than ten (10) Interest Periods
outstanding at any time, up to five (5) of which may be with respect to
Alternative Currency Loans.
25
(c) Applicable Margin. The Applicable Margin provided for in Section
4.1(a) with respect to the Loans (the "Applicable Margin") shall be determined
by reference to the Leverage Ratio in accordance with the following chart:
Applicable Margin Per Annum
Level Leverage Ratio LIBOR + Base Rate +
----- -------------- ------- -----------
I Greater than 2.25 to 1.00 2.00% .75%
II Equal to or less than 1.75% .50%
2.25 to 1.00 but greater
than 1.50 to 1.00
III Equal to or less than 1.50% .25%
1.50 to 1.00
The Applicable Margin on the Closing Date shall be 1.50% with respect to LIBOR
Rate Loans and 0.25% with respect to Base Rate Loans.
Adjustments, if any, in the Applicable Margin shall be made by the
Administrative Agent on the tenth (10th) Business Day (the "Adjustment Date")
after receipt by the Administrative Agent of financial statements for the
Borrower and its Subsidiaries delivered under Section 7.1(a) or (b), as
applicable, and the accompanying Officer's Compliance Certificate setting forth
the Leverage Ratio as of the most recent fiscal quarter end. The Administrative
Agent agrees to give the Borrower and the Lenders notice of any adjustment in
the Applicable Margin within two (2) Business Days of such adjustment; provided,
that the Administrative Agent's failure to give such notice shall not result in
any liability to the Administrative Agent or in any way affect the validity of
any such adjustment. In the event the Borrower fails to deliver such financial
statements and certificate within the time required by Sections 7.1(a) and 7.2
hereof, the Applicable Margin shall be the highest Applicable Margin set forth
above until the delivery of such financial statements and certificate unless at
such time the outstanding principal balance of any Loans are bearing interest at
the "default rate" set forth in Section 4.1(d) below, in which case the
Applicable Margin shall not be increased pursuant to this sentence.
(d) Default Rate. Upon the occurrence and during the continuance of an
Event of Default, (i) all outstanding LIBOR Rate Loans shall upon the request of
the Required Lenders bear interest at a rate per annum two percent (2%) plus the
rate then applicable to LIBOR Rate Loans until the end of the applicable
Interest Period and thereafter at a rate equal to two percent (2%) plus the rate
then applicable to Base Rate Loans, and (ii) all outstanding Base Rate Loans
shall, upon the request of the Required Lenders, bear interest at a rate per
annum equal to two percent (2%) plus the rate then applicable to Base Rate
Loans. Interest shall continue to accrue on the Notes after the filing by or
against the Borrower of any petition seeking any relief in bankruptcy or under
any act or law pertaining to insolvency or debtor relief, whether state, federal
or foreign.
(e) Interest Payment and Computation. Interest on each Base Rate Loan
shall be payable in arrears on the last Business Day of each fiscal quarter and
interest on each LIBOR Rate Loan shall be payable on the last day of each
Interest Period applicable thereto, provided that, in the case of an Interest
Period in excess of three (3) months, accrued interest shall also be paid on
26
the day which is three (3) months after the commencement of such Interest
Period. All interest rates, fees and commissions provided hereunder shall be
computed on the basis of a 360-day year and assessed for the actual number of
days elapsed; provided that interest on Base Rate Loans and Alternative Currency
Loans denominated in Pounds Sterling shall be computed on the basis of a
365/366-day year and assessed for the actual number of days elapsed.
(f) Maximum Rate. In no contingency or event whatsoever shall the
aggregate of all amounts deemed interest hereunder or under any of the Notes and
charged or collected pursuant to the terms of this Agreement or pursuant to any
of the Notes exceed the highest rate permissible under any Applicable Law which
a court of competent jurisdiction shall, in a final determination, deem
applicable hereto. In the event that such a court determines that the Lenders
have charged or received interest hereunder in excess of the highest applicable
rate, the rate in effect hereunder shall automatically be reduced to the maximum
rate permitted by Applicable Law and the Lenders shall at the Administrative
Agent's option promptly refund to the Borrower any interest received by Lenders
in excess of the maximum lawful rate or shall apply such excess to the principal
balance of the Obligations. It is the intent hereof that the Borrower not pay or
contract to pay, and that neither the Administrative Agent nor any Lender
receive or contract to receive, directly or indirectly in any manner whatsoever,
interest in excess of that which may be paid by the Borrower under Applicable
Law.
SECTION 4.2 Notice and Manner of Conversion or Continuation of Loans.
Provided that no Default (other than a Default arising from any of the events
specified in Section 11.1(e), (f) and (n) hereof) or Event of Default has
occurred and is then continuing, and the Required Lenders have not otherwise so
notified the Borrower, the Borrower shall have the option to (a) convert at any
time all or any portion of its outstanding Base Rate Loans in a principal amount
equal to $2,500,000 or any whole multiple of $500,000 in excess thereof into one
or more LIBOR Rate Loans denominated in Dollars or (b) subject to Section 4.9,
convert all or any part of its outstanding LIBOR Rate Loans denominated in
Dollars in a principal amount equal to $5,000,000 or a whole multiple of
$1,000,000 in excess thereof into Base Rate Loans or (c) upon the expiration of
any Interest Period, continue any LIBOR Rate Loan denominated in any Permitted
Currency in a principal amount of $5,000,000 or any whole multiple of $1,000,000
in excess thereof (or with respect to LIBOR Rate Loans denominated in an
Alternative Currency, the Alternative Currency Amount in each case thereof) as a
LIBOR Rate Loan in the same Permitted Currency. Whenever the Borrower desires to
convert or continue Loans as provided above, the Borrower shall give the
Administrative Agent irrevocable prior written notice in substantially the form
attached as Exhibit C (a "Notice of Conversion/Continuation") not later than
12:00 noon (Charlotte time) four (4) Business Days (with respect to any Loan
denominated in an Alternative Currency) and three (3) Business Days (with
respect to any Loan denominated in Dollars) before the day on which a proposed
conversion or continuation of such Loan is to be effective specifying (A) the
Loans to be converted or continued, the Permitted Currency in which such Loan is
denominated and, in the case of any LIBOR Rate Loan to result from any such
continuation or conversion, the last day of the Interest Period therefor, (B)
the effective date of such conversion or continuation (which shall be a Business
Day), (C) the principal amount of such Loans to be converted or continued, and
(D) the Interest Period to be applicable to the LIBOR Rate Loan resulting from
such continuation or conversion. The Administrative Agent shall promptly notify
the Lenders of such Notice of Conversion/Continuation.
27
SECTION 4.3 Fees.
(a) Commitment Fee. Commencing on the Closing Date and continuing
through but excluding the Termination Date, the Borrower shall pay to the
Administrative Agent, for the account of the Lenders, a non-refundable
commitment fee at a rate per annum equal to the rate set forth below (the
"Commitment Fee Rate") on the average daily unused portion of the Aggregate
Commitment. The commitment fee shall be payable in arrears on the last Business
Day of each calendar quarter commencing on December 31, 1998, and on the
Termination Date. Such commitment fee shall be distributed by the Administrative
Agent to the Lenders pro rata in accordance with the Lenders' respective
Commitment Percentages.
The Commitment Fee Rate provided for above shall equal the percentage
set forth below corresponding to the Level at which the Applicable Margin is
determined in accordance with Section 4.1(c). Any change in the applicable Level
at which the Applicable Margin is determined shall result in a corresponding and
simultaneous change in the Commitment Fee Rate.
Level Commitment Fee Rate
----- -------------------
I 0.500%
II 0.375%
III 0.375%
(b) Other Fees. In order to compensate First Union and Xxxxxx for
structuring and syndicating the Credit Facility and for their obligations
hereunder, the Borrower agrees to pay to First Union and Xxxxxx, for their
respective accounts, the fees set forth in the separate fee letter agreement
executed by the Borrower and First Union and Xxxxxx dated September 1, 1998.
SECTION 4.4 Manner of Payment.
(a) Loans Denominated in Dollars. Each payment (including repayments
described in Article II) by the Borrower on account of the principal of or
interest on the Loans denominated in Dollars or of any fee, commission or other
amounts (including the Reimbursement Obligation) payable to the Lenders under
this Agreement or any Note (except as set forth in Section 4.4(b)) shall be made
in Dollars not later than 1:00 p.m. (Charlotte time) on the date specified for
payment under this Agreement to the Administrative Agent at the Administrative
Agent's Office for the account of the Lenders (other than as set forth below)
pro rata in accordance with their respective Commitment Percentages (except as
specified below), in Dollars, in immediately available funds and shall be made
without any set-off, counterclaim or deduction whatsoever. Any payment received
after such time but before 2:00 p.m. (Charlotte time) on such day shall be
deemed a payment on such date for the purposes of Section 11.1, but for all
other purposes shall be deemed to have been made on the next succeeding Business
Day. Any payment received after 2:00 p.m. (Charlotte time) shall be deemed to
have been made on the next succeeding Business Day for all purposes.
28
(b) Alternative Currency Loans. Each payment (including repayments
described in Article II) by the Borrower on account of the principal of or
interest on the Loans denominated in any Alternative Currency shall be made in
such Alternative Currency not later than 11:00 a.m. (the time of the
Administrative Agent's Correspondent) on the date specified for payment under
this Agreement to the Administrative Agent's account with the Administrative
Agent's Correspondent for the account of the Lenders (other than as set forth
below) pro rata in accordance with their respective Commitment Percentages
(other than as set forth below) in immediately available funds, and shall be
made without any set-off, counterclaim or deduction whatsoever. Any payment
received after such time but before 12:00 noon (the time of the Administrative
Agent's Correspondent) on such day shall be deemed a payment on such date for
the purposes of Section 11.1, but for all other purposes shall be deemed to have
been made on the next succeeding Business Day. Any payment received after 12:00
noon (the time of the Administrative Agent's Correspondent) shall be deemed to
have been made on the next succeeding Business Day for all purposes.
(c) Pro Rata Treatment. Upon receipt by the Administrative Agent of
each such payment, the Administrative Agent shall distribute to each Lender at
its address for notices set forth herein its pro rata share of such payment in
accordance with such Lender's Commitment Percentage (except as specified below)
and shall wire advice of the amount of such credit to each Lender. With respect
to each distribution to be made by the Administrative Agent under this Section
4.4(c), each payment which is received by the Administrative Agent prior to 1:00
p.m. (Charlotte time) on any Business Day shall be distributed on the same
Business Day, and any payment received after 1:00 p.m. (Charlotte time) on any
Business Day shall be distributed on the following Business Day. Each payment to
the Administrative Agent of the Issuing Lender's fees or L/C Participants'
commissions shall be made in like manner, but for the account of the Issuing
Lender or the L/C Participants, as the case may be. Each payment to the
Administrative Agent of Administrative Agent's fees or expenses shall be made
for the account of the Administrative Agent and any amount payable to any Lender
under Sections 4.9, 4.10, 4.11, 4.12, 4.13 or 13.2 shall be paid to the
Administrative Agent for the account of the applicable Lender. Subject to
Section 4.1(b)(ii) if any payment under this Agreement, any Note or any other
Loan Document shall be specified to be made upon a day which is not a Business
Day, it shall be made on the next succeeding day which is a Business Day and
such extension of time shall in such case be included in computing any interest
if payable along with such payment.
SECTION 4.5 Crediting of Payments and Proceeds. In the event that the
Borrower shall fail to pay any of the Obligations when due and the Obligations
have been accelerated pursuant to Section 11.2, all payments received by the
Lenders upon the Notes and the other Obligations and all net proceeds from the
enforcement of the Obligations shall be applied first to all expenses then due
and payable by the Borrower hereunder, then to all indemnity obligations then
due and payable by the Borrower hereunder, then to all Administrative Agent's
and Issuing Lender's fees then due and payable, then to accrued and unpaid
interest on the Notes, the Reimbursement Obligation and any termination payments
due in respect of a Hedging Agreement with any Lender (if Hedging Agreement is
permitted or required hereunder) (pro rata in accordance with all such amounts
due), then to the principal amount of the Notes and Reimbursement Obligations
and then to the cash collateral account described in Section 11.2(b) hereof to
the extent of any L/C Obligations then outstanding, in that order.
29
SECTION 4.6 Adjustments. If any Lender (a "Benefited Lender") shall at
any time receive any payment of all or part of the Obligations owing to it, or
interest thereon, or if any Lender shall at any time receive any collateral in
respect of the Obligations owing to it (whether voluntarily or involuntarily, by
set-off or otherwise) in a greater proportion than any such payment to and
collateral received by any other Lender, if any, in respect of the Obligations
owing to such other Lender, or interest thereon, such Benefited Lender shall
purchase for cash from the other Lenders such portion of each such other
Lender's Extensions of Credit, or shall provide such other Lenders with the
benefits of any such collateral, or the proceeds thereof, as shall be necessary
to cause such Benefited Lender to share the excess payment or benefits of such
collateral or proceeds ratably with each of the Lenders; provided, that if all
or any portion of such excess payment or benefits is thereafter recovered from
such Benefited Lender, such purchase shall be rescinded, and the purchase price
and benefits returned to the extent of such recovery, but without interest. The
Borrower agrees that each Lender so purchasing a portion of another Lender's
Extensions of Credit may exercise all rights of payment (including, without
limitation, rights of set-off) with respect to such portion as fully as if such
Lender were the direct holder of such portion.
SECTION 4.7 Nature of Obligations of Lenders Regarding Extensions of
Credit; Assumption by the Administrative Agent. The obligations of the Lenders
under this Agreement to make the Loans and issue or participate in Letters of
Credit are several and are not joint or joint and several. Unless the
Administrative Agent shall have received notice from a Lender prior to a
proposed borrowing time that such Lender will not make available to the
Administrative Agent such Lender's ratable portion of the amount to be borrowed
on such date (which notice shall not release such Lender of its obligations
hereunder), the Administrative Agent may assume that such Lender has made such
portion available to the Administrative Agent on the proposed borrowing date in
accordance with Section 2.2(b) and the Administrative Agent may, in reliance
upon such assumption, make available to the Borrower on such date a
corresponding amount. If such amount is made available to the Administrative
Agent on a date after such borrowing date, such Lender shall pay to the
Administrative Agent on demand an amount, until paid, equal to (a) with respect
to a Loan denominated in Dollars, the amount of such Lender's Commitment
Percentage of such borrowing and interest thereon at a rate equal to the daily
average Federal Funds Rate during such period as determined by the
Administrative Agent and (b) with respect to a loan denominated in an
Alternative Currency the amount not made available by such Lender in accordance
with the terms hereof and interest thereon at a rate per annum equal to the
Administrative Agent's aggregate marginal cost (including the cost of
maintaining any required reserves or deposit insurance and of any fees,
penalties, overdraft charges or other costs or expenses incurred by the
Administrative Agent as a result of the failure to deliver funds hereunder) of
carrying such amount. A certificate of the Administrative Agent with respect to
any amounts owing under this Section shall be conclusive, absent manifest error.
If such Lender's Commitment Percentage of such borrowing is not made available
to the Administrative Agent by such Lender within three (3) Business Days of
such borrowing date, the Administrative Agent shall be entitled to recover such
amount made available by the Administrative Agent with interest thereon at the
rate per annum applicable to Base Rate Loans hereunder, on demand, from the
Borrower. The failure of any Lender (herein, a "Defaulting Lender") to make
available its Commitment Percentage of any Loan requested by the Borrower shall
not relieve it or any other Lender of its obligation, if any, hereunder to make
its Commitment Percentage of such Loan available on the
30
applicable borrowing date, but no Lender shall be responsible for the failure
of any other Lender to make its Commitment Percentage of such Loan available on
the applicable borrowing date.
SECTION 4.8 Changed Circumstances.
(a) Circumstances Affecting LIBOR Rate and Alternative Currency
Availability. If with respect to any Interest Period the Administrative Agent or
any Lender (after consultation with the Administrative Agent) shall determine
that (i) by reason of circumstances affecting the foreign exchange and interbank
markets generally, deposits in eurodollars or an Alternative Currency in the
applicable amounts are not being quoted via Dow Xxxxx Markets screen 3750 or
offered to the Administrative Agent or such Lender for such Interest Period,
(ii) a fundamental change has occurred in the foreign exchange or interbank
markets with respect to any Alternative Currency (including, without limitation,
changes in national or international financial, political or economic conditions
or currency exchange rates or exchange controls) or (iii) it has become
otherwise materially impractical for the Administrative Agent or such Lender to
make such Loan in an Alternative Currency, then the Administrative Agent shall
forthwith give notice thereof to the Borrower. Thereafter, until the
Administrative Agent notifies the Borrower that such circumstances no longer
exist, the obligation of the Lenders to make LIBOR Rate Loans or Alternative
Currency Loans, as applicable, and the right of the Borrower to convert any Loan
to or continue any Loan as a LIBOR Rate Loan or Alternative Currency Loan, as
applicable, shall be suspended, and the Borrower shall repay in full (or cause
to be repaid in full) the then outstanding principal amount of each such LIBOR
Rate Loan or Alternative Currency Loan, as applicable, together with accrued
interest thereon, on the last day of the then current Interest Period applicable
to such LIBOR Rate Loan or Alternative Currency Loan, as applicable, or convert
the then outstanding principal amount of each such LIBOR Rate Loan or
Alternative Currency Loan, as applicable, to a Base Rate Loan as of the last day
of such Interest Period.
(b) Laws Affecting LIBOR Rate and Alternative Currency Availability.
If, after the date hereof, the introduction of, or any change in, any Applicable
Law or any change in the interpretation or administration thereof by any
Governmental Authority, central bank or comparable agency charged with the
interpretation or administration thereof, or compliance by any Lender (or any of
its respective Lending Offices) with any request or directive (whether or not
having the force of law) of any such Governmental Authority, central bank or
comparable agency, shall make it unlawful or impossible for any of the Lenders
(or any of their respective Lending Offices) to honor its obligations hereunder
to make or maintain any LIBOR Rate Loan or any Alternative Currency Loan, such
Lender shall promptly give notice thereof to the Administrative Agent and the
Administrative Agent shall promptly give notice to the Borrower and the other
Lenders. Thereafter, until the Administrative Agent notifies the Borrower that
such circumstances no longer exist, (i) the obligations of such Lender to make
LIBOR Rate Loans or Alternative Currency Loans, as applicable, and the right of
the Borrower to convert any Loan made by such Lender or continue any Loan made
by such Lender as a LIBOR Rate Loan or Alternative Currency Loan, as applicable,
shall be suspended, and (ii) if any of the Lenders may not lawfully continue to
maintain a LIBOR Rate Loan or Alternative Currency Loans, as applicable, to the
end of the then current Interest Period applicable thereto as a LIBOR Rate Loan
or Alternative Currency Loans, as applicable, the applicable LIBOR Rate
31
Loan or Alternative Currency Loans, as applicable, shall immediately be
converted to a Base Rate Loan for the remainder of such Interest Period.
(c) Increased Costs. If, after the date hereof, the introduction of, or
any change in, any Applicable Law, 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 of the
Lenders (or any of their respective Lending Offices) with any request or
directive (whether or not having the force of law) of such Governmental
Authority, central bank or comparable agency:
(i) shall subject any of the Lenders (or any of their
respective Lending Offices) to any tax, duty or other charge with
respect to any Note, Letter of Credit or Application or shall change
the basis of taxation of payments to any of the Lenders (or any of
their respective Lending Offices) of the principal of or interest on
any Note, or in respect of any Letter of Credit or Application or any
other amounts due under this Agreement in respect thereof (except for
changes in the rate of tax on the overall net income of any of the
Lenders or any of their respective Lending Offices imposed by the
jurisdiction in which such Lender is organized or is or should be
qualified to do business or such Lending Office is located); or
(ii) shall impose, modify or deem applicable any reserve
(including, without limitation, any imposed by the Board of Governors
of the Federal Reserve System), special deposit, insurance or capital
or similar requirement against assets of, deposits with or for the
account of, or credit extended by any of the Lenders (or any of their
respective Lending Offices) or shall impose on any of the Lenders (or
any of their respective Lending Offices) or the foreign exchange and
interbank markets any other condition affecting any Note;
and the result of any of the foregoing is to increase the costs to any of the
Lenders of maintaining any LIBOR Rate Loan or Alternative Currency Loan as
applicable, or issuing or participating in Letters of Credit, or to reduce the
yield or amount of any sum received or receivable by any of the Lenders under
this Agreement or under the Notes in respect of a LIBOR Rate Loan or Alternative
Currency Loan, as applicable, or Letter of Credit or Application, then such
Lender shall promptly notify the Borrower of such fact and demand compensation
therefor and, within fifteen (15) days after such notice, the Borrower shall pay
to such Lender such additional amount or amounts as will compensate such Lender
or Lenders for such increased cost or reduction; provided that if any Lender
claiming compensation under this Section 4.8(c) fails to give such notice within
ninety (90) days after it obtains actual knowledge of such an event, such Lender
shall, with respect to such compensation in respect of any costs resulting from
such event, only be entitled to payment under this Section 4.8(c) for costs
incurred from and after the date ninety (90) days prior to the date that such
Lender does give such notice. The Administrative Agent will promptly notify the
Borrower of any event of which it has knowledge which will entitle such Lender
to compensation pursuant to this Section 4.8(c), provided, that the
Administrative Agent shall incur no liability whatsoever to the Lenders or the
Borrower in the event it fails to do so. The amount of such compensation shall
be determined, in the applicable Lender's sole discretion, based upon the
assumption that such Lender funded its Commitment Percentage of the LIBOR Rate
Loans or Alternative Currency Loans, as
32
applicable in the London interbank market and using any reasonable attribution
or averaging methods which such Lender deems appropriate and practical. A
certificate of such Lender setting forth the basis for determining such amount
or amounts necessary to compensate such Lender shall be forwarded to the
Borrower through the Administrative Agent and shall be conclusively presumed to
be correct save for manifest error. The obligations of the Borrower under this
Section 4.8(c) shall survive the payment in full of the Obligations and the
termination of the Commitments.
SECTION 4.9 Indemnity. The Borrower hereby indemnifies each Lender
against any loss or expense (including without limitation any foreign exchange
costs) which may arise or be attributable to such Lender's obtaining,
liquidating or employing deposits or other funds acquired to effect, fund or
maintain any Loan (a) as a consequence of any failure by the Borrower to make
any payment when due of any amount due hereunder in connection with a LIBOR Rate
Loan, (b) due to any failure of the Borrower to borrow, continue or convert on a
date specified therefor in a Notice of Borrowing or Notice of
Continuation/Conversion or (c) due to any payment, prepayment or conversion of
any LIBOR Rate Loan on a date other than the last day of the Interest Period
therefor. The amount of such loss or expense shall be determined, in the
applicable Lender's sole discretion, based upon the assumption that such Lender
funded its Commitment Percentage of the LIBOR Rate Loans in the London interbank
market and using any reasonable attribution or averaging methods which such
Lender deems appropriate and practical. A certificate of such Lender setting
forth the basis for determining such amount or amounts necessary to compensate
such Lender shall be forwarded to the Borrower through the Administrative Agent
and shall be conclusively presumed to be correct save for manifest error. The
obligations of the Borrower under this Section 4.9 shall survive the payment in
full of the Obligations and the termination of the Commitments.
SECTION 4.10 Capital Requirements. If either (a) the introduction of,
or any change in or in the interpretation of, any Applicable Law or (b)
compliance with any guideline or request made from any central bank or
comparable agency or other Governmental Authority (whether or not having the
force of law), has or would have the effect of reducing the rate of return on
the capital of, or has affected or would affect the amount of capital required
to be maintained by, any Lender or any corporation controlling such Lender as a
consequence of, or with reference to the Commitments and other commitments of
this type, below the rate which such Lender or such other corporation could have
achieved but for such introduction, change or compliance, then within five (5)
Business Days after written demand by any such Lender, the Borrower shall pay to
such Lender from time to time as specified by such Lender additional amounts
sufficient to compensate such Lender or other corporation for such reduction.
Any Lender claiming compensation under this Section 4.10 shall notify the
Borrower of any event entitling such Lender to such compensation as promptly as
practicable, but in any event within ninety (90) days after such Lender obtains
actual knowledge thereof; provided that if such Lender fails to give such notice
within ninety (90) days after it obtains actual knowledge of such an event, such
Lender shall, with respect to such compensation in respect of any costs
resulting from such event, only be entitled to payment under this Section 4.10
for costs incurred from and after the date ninety (90) days prior to the date
that such Lender does give such notice. A certificate as to such amounts
submitted to the Borrower and the Administrative Agent by such Lender shall, in
the absence of manifest error, be presumed to be correct and binding for all
purposes. The obligations of the Borrower under this Section 4.10 shall survive
the payment in full of the Obligations and the
33
termination of the Commitments.
SECTION 4.11 Taxes.
(a) Payments Free and Clear. Any and all payments by the Borrower
hereunder or under the Notes or in respect of the Letters of Credit shall be
made free and clear of and without deduction for any and all present or future
taxes, levies, imposts, deductions, charges or withholding, and all liabilities
with respect thereto, excluding, (i) in the case of each Lender and the
Administrative Agent, income and franchise taxes imposed by the jurisdiction
under the laws of which such Lender or the Administrative Agent (as the case may
be) is organized or is or should be qualified to do business or any political
subdivision thereof and (ii) in the case of each Lender, income and franchise
taxes imposed by the jurisdiction of such Lender's Lending Office or any
political subdivision thereof (all such non-excluded taxes, levies, imposts,
deductions, charges, withholdings and liabilities being hereinafter referred to
as "Taxes"). If the Borrower shall be required by law to deduct any Taxes from
or in respect of any sum payable hereunder or under any Note or in respect of
Letter of Credit to any Lender or the Administrative Agent, (A) the sum payable
shall be increased as may be necessary so that after making all required
deductions (including deductions applicable to additional sums payable under
this Section 4.11) such Lender or the Administrative Agent (as the case may be)
receives an amount equal to the amount such party would have received had no
such deductions been made, (B) the Borrower shall make such deductions, (C) the
Borrower shall pay the full amount deducted to the relevant taxing authority or
other authority in accordance with applicable law, and (D) the Borrower shall
deliver to the Administrative Agent evidence of such payment to the relevant
taxing authority or other authority in the manner provided in Section 4.11(d).
(b) Stamp and Other Taxes. In addition, the Borrower shall pay any
present or future stamp, registration, recordation or documentary taxes or any
other similar fees or charges or excise or property taxes, levies of the United
States or any state or political subdivision thereof or any applicable foreign
jurisdiction which arise from any payment made hereunder or from the execution,
delivery or registration of, or otherwise with respect to, this Agreement, the
Loans, the Letters of Credit, the other Loan Documents, or the perfection of any
rights or security interest in respect thereto (hereinafter referred to as
"Other Taxes").
(c) Indemnity. The Borrower shall indemnify each Lender and the
Administrative Agent for the full amount of Taxes and Other Taxes (including,
without limitation, any Taxes and Other Taxes imposed by any jurisdiction on
amounts payable under this Section 4.11) paid by such Lender or the
Administrative Agent (as the case may be) and any liability (including
penalties, interest and expenses) arising therefrom or with respect thereto,
whether or not such Taxes or Other Taxes were correctly or legally asserted.
Such indemnification shall be made within thirty (30) days from the date such
Lender or the Administrative Agent (as the case may be) makes written demand
therefor.
(d) Evidence of Payment. Within thirty (30) days after the date of any
payment of Taxes or Other Taxes, the Borrower shall furnish to the
Administrative Agent, at its address referred to in Section 13.1, the original
or a certified copy of a receipt evidencing payment thereof or other evidence of
payment satisfactory to the Administrative Agent.
34
(e) Delivery of Tax Forms. Each Lender organized under the laws of a
jurisdiction other than the United States or any state thereof shall deliver to
the Borrower and Guarantors, with a copy to the Administrative Agent, on the
Closing Date or concurrently with the delivery of the relevant Assignment and
Acceptance, as applicable, (i) two United States Internal Revenue Service Forms
4224 or Forms 1001, as applicable (or successor forms) properly completed and
certifying in each case that such Lender is entitled to a complete exemption
from withholding or deduction for or on account of any United States federal
income taxes, and (ii) an Internal Revenue Service Form W-8 or W-9 or successor
applicable form, as the case may be, to establish an exemption from United
States backup withholding taxes. Each such Lender further agrees to deliver to
the Borrower and Guarantors, with a copy to the Administrative Agent, a Form
1001 or 4224 and Form W-8 or W-9, or successor applicable forms or manner of
certification, as the case may be, on or before the date that any such form
expires or becomes obsolete or after the occurrence of any event requiring a
change in the most recent form previously delivered by it to the Borrower and
Guarantors, certifying in the case of a Form 1001 or 4224 that such Lender is
entitled to receive payments under this Agreement without deduction or
withholding of any United States federal income taxes (unless in any such case
an event (including without limitation any change in treaty, law or regulation)
has occurred prior to the date on which any such delivery would otherwise be
required which renders such forms inapplicable or the exemption to which such
forms relate unavailable and such Lender notifies the Borrower and Guarantors
and the Administrative Agent that it is not entitled to receive payments without
deduction or withholding of United States federal income taxes) and, in the case
of a Form W-8 or W-9, establishing an exemption from United States backup
withholding tax.
(f) Survival. Without prejudice to the survival of any other agreement
of the Borrower hereunder, the agreements and obligations of the Borrower
contained in this Section 4.11 shall survive the payment in full of the
Obligations and the termination of the Commitments.
SECTION 4.12 Mandatory Redenomination of Alternative Currency Loans.
(a) If any LIBOR Rate Loan is required to be converted to a Base Rate
Loan pursuant to Section 4.1(d), Section 4.8 or any other applicable provision
hereof, such Loan shall be funded in Dollars in an amount equal to the Dollar
Amount of such Loan, all subject to the provisions of Section 2.3(c). The
Borrower shall reimburse the Lenders upon any such conversion for any amounts
required to be paid under Section 4.9 hereof.
(b) If, as result of the implementation of the European economic and
monetary union ("EMU"), (i) any Alternative Currency ceases to be lawful
currency of the nation issuing such currency and is replaced by the euro or (ii)
any Alternative Currency and the euro are at the same time recognized by any
governmental authority of the nation issuing such Alternative Currency as lawful
currency of such nation, then any amount payable hereunder by the Borrower in
such Alternative Currency shall instead be payable in the euro and the amount so
payable shall be determined by translating the amount so payable in such other
Alternative Currency to the euro at the exchange rate recognized by the European
central bank (or such other governmental or regulatory authority designated by
the EMU for establishing such exchange rate) for the purpose of implementing the
EMU. Prior to the occurrence of the event
35
or events described in clause (i) or (ii) of the preceding sentence, each
amount payable hereunder in any Alternative Currency will, except as otherwise
provided herein, continue to be payable only in that Alternative Currency.
(c) The terms and provisions of this Agreement will be subject to such
reasonable changes of construction as determined by the Administrative Agent
(acting reasonably and in consultation with the Borrower) to reflect such
implementation of the euro and to put the Lenders and the Borrower in the same
position, so far as possible, that they would have been if such implementation
had not occurred. Except as provided in the foregoing provisions of this Section
4.12, no such implementation nor any economic consequences resulting therefrom
shall give rise to any right to terminate, contest, cancel, modify or
renegotiate the provisions of this Agreement.
SECTION 4.13 Regulatory Limitation. In the event, as a result of
increases in the value of Alternative Currencies against the Dollar, the
obligation of any of the Lenders to make Loans (taking into account the Dollar
Amount of the Obligations and all other indebtedness required to be aggregated
under 12 U.S.C.A. ss.84, as amended, the regulations promulgated thereunder and
any other Applicable Law) is determined by such Lender to exceed its then
applicable legal lending limit under 12 U.S.C.A. ss.84, as amended, and the
regulations promulgated thereunder, or any other Applicable Law, the amount of
additional Extensions of Credit such Lender shall be obligated to make or issue
or participate in hereunder shall immediately be reduced to the maximum amount
which such Lender may legally advance (as determined by such Lender), subject to
reinstatement to the extent that such maximum amount may thereafter increase
from time to time.
SECTION 4.14 Claims for Increased Costs and Taxes. In the event that
any Lender shall decline to make LIBOR Rate Loans or Alternative Currency Loans
pursuant to Section 4.8(a) or (b) hereof or shall have notified the Borrower
that it is entitled to claim compensation pursuant to Section 4.8(c), 4.10 or
4.11 hereof or is unable to complete the form required or is subject to
withholding as provided in Section 4.11 hereof (each such Lender being an
"Affected Lender"), the Borrower at its own cost and expense may designate a
replacement bank (a "Replacement Lender") to assume the Commitment and the
obligations of any such Affected Lender hereunder, and to purchase the
outstanding Note and L/C Obligations of such Affected Lender and such Affected
Lender's rights hereunder and with respect thereto, without recourse upon, or
warranty by, or expense to, such Affected Lender, for a purchase price equal to
(unless such Lender agrees to a lesser amount) the outstanding principal amount
of all Extensions of Credit of such Affected Lender plus all interest accrued
and unpaid thereon and all other amounts owing to such Affected Lender
hereunder, including, without limitation, any amount which would be payable to
such Affected Lender pursuant to Sections 4.8(c), 4.9, 4.10 and 4.11 and upon
such assumption and purchase by the Replacement Lender, such Replacement Lender
shall be deemed to be a "Lender" for purposes of this Agreement and such
Affected Lender shall cease to be a "Lender" for purposes of this Agreement and
shall no longer have any obligations or rights hereunder (other than any
obligations or rights which according to this Agreement shall survive the
termination of the Commitments). In the event any Lender receives a refund or
credit with respect to withholding taxes paid by the Borrower, such Lender shall
promptly repay such amounts to the Borrower.
36
SECTION 4.15 Rounding of Amounts in Certain Situations. Without
prejudice and in addition to any method of conversion or rounding prescribed by
any EMU Legislation, each reference in this Agreement to a minimum amount (or an
integral multiple thereof) in a National Currency Unit or the euro to be paid to
or by the Administrative Agent or the Lenders shall be replaced by a reference
to such reasonably compatible and convenient amount (or an integral multiple
thereof) in such National Currency Unit or the euro as the Administrative Agent
or the Lenders may from time to time specify.
SECTION 4.16 Security. The Obligations of the Borrower shall be
guaranteed as provided in the Guaranty Agreement and secured as provided in the
Pledge and Security Agreement.
ARTICLE V
CLOSING; CONDITIONS OF CLOSING AND BORROWING
SECTION 5.1 Closing. The closing shall take place at the offices of
Xxxxxxx Xxxxxxxxx Xxxxxxx & Xxxxxxx, L.L.P., 000 Xxxxx Xxxxx Xxxxxx, Xxxxx 0000,
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000 at 10:00 a.m. on October 22, 1998, or on such
other date as the parties hereto shall mutually agree.
SECTION 5.2 Conditions to Closing, Initial Loan and Letter of Credit.
The obligation of the Lenders to close this Agreement and to make the initial
Loan or issue the initial Letter of Credit is subject to the satisfaction of
each of the following conditions:
(a) Executed Loan Documents. This Agreement, the Notes, the
Guaranty Agreement, the Pledge and Security Agreement and a completed
Application with respect to each Letter of Credit to be issued on the
Closing Date shall have been duly authorized, executed and delivered to
the Administrative Agent by the parties thereto, shall be in full force
and effect and no Default or Event of Default shall exist.
(b) Closing Certificates; etc.
(i) Officer's Certificate of the Borrower. The
Administrative Agent shall have received a certificate from a
Responsible Officer, in form and substance satisfactory to the
Administrative Agent, to the effect that all representations
and warranties of the Borrower and its Subsidiaries contained
in this Agreement and the other Loan Documents are true,
correct and complete in all material respects; that the
Borrower is not in violation of any of the covenants contained
in this Agreement and the other Loan Documents; that, after
giving effect to the transactions contemplated by this
Agreement, no Default or Event of Default has occurred and is
continuing; and that the Borrower has satisfied each of the
closing conditions.
(ii) Certificate of Secretary of the Borrower and
each Subsidiary Guarantor. The Administrative Agent shall have
received a certificate of the
37
secretary or assistant secretary of the Borrower and each
Subsidiary Guarantor certifying as to the incumbency and
genuineness of the signature of each officer of the Borrower
or such Subsidiary Guarantor executing Loan Documents to
which it is a party and certifying that attached thereto is a
true, correct and complete copy of (A) the articles of
incorporation of the Borrower or such Subsidiary Guarantor
and all amendments thereto, certified as of a recent date by
the appropriate Governmental Authority in its jurisdiction of
incorporation, (B) the bylaws of the Borrower or such
Subsidiary Guarantor as in effect on the date of such
certifications, (C) resolutions duly adopted by the Board of
Directors of the Borrower or such Subsidiary Guarantor
authorizing the borrowings contemplated hereunder and the
execution, delivery and performance of this Agreement and the
other Loan Documents to which it is a party, and (D) each
certificate required to be delivered pursuant to Section
5.2(b)(iii).
(iii) Certificates of Good Standing. The
Administrative Agent shall have received long-form
certificates as of a recent date of the good standing of the
Borrower and each Subsidiary Guarantor under the laws of its
jurisdiction of organization and, to the extent requested by
the Administrative Agent, each other jurisdiction where the
Borrower or such Subsidiary Guarantor is qualified to do
business.
(iv) Opinions of Counsel. The Administrative Agent
shall have received favorable opinions of counsel to the
Borrower and the Subsidiary Guarantors addressed to the
Administrative Agent and the Lenders with respect to the
Borrower, the Subsidiary Guarantors, the Loan Documents and
such other matters as the Lenders shall reasonably request.
(v) Tax Forms. The Administrative Agent shall have
received on behalf of the Borrower the United States Internal
Revenue Service forms required by Section 4.11(e) hereof.
(c) Collateral.
(i) Filings and Recordings. All filings and
recordations that are necessary to perfect the security
interests of the Administrative Agent for the benefit of the
Lenders in the collateral described in the Pledge and Security
Agreement shall have been received by the Administrative Agent
and the Administrative Agent shall have received evidence
satisfactory to the Administrative Agent that upon such
filings and recordations such security interests constitute
valid and perfected first priority Liens thereon.
(ii) Pledged Collateral. The Administrative Agent
shall have received original stock certificates or other
certificates evidencing the capital stock or other ownership
interests pledged pursuant to the Pledge Agreement, together
with an undated stock power for each such certificate duly
executed in blank by the registered owner thereof.
38
(d) Financial Matters.
(i) Financial Statements. The Administrative Agent
shall have received recent annual and interim financial
statements and other financial information with respect to the
Borrower and its Subsidiaries prepared in accordance with
GAAP. Without limitation of the foregoing, the Administrative
Agent and each Lender shall have received the audited
Consolidated financial statements for the Borrower and its
Subsidiaries as of the end of and for the fiscal year ended
December 31, 1997 and the unaudited quarterly financial
statements for the Borrower and its Subsidiaries as of the end
of and for the quarter and six-month period ended June 30,
1998, as filed on Form 10Q.
(ii) Financial Condition Certificate. The Borrower
shall have delivered to the Administrative Agent a
certificate, in form and substance satisfactory to the
Administrative Agent, and certified as accurate by a
Responsible Officer, that (A) the Borrower and each of its
Subsidiaries are Solvent, (B) the material payables of the
Borrower and each Subsidiary Guarantor are current and not
past due, (C) attached thereto is a pro forma balance sheet of
the Borrower and its Subsidiaries setting forth on a pro forma
basis the financial condition of the Borrower and its
Subsidiaries on a Consolidated basis as of the Closing Date,
reflecting on a pro forma basis the effect of the transactions
contemplated herein, including all fees and expenses in
connection therewith, and evidencing compliance on a pro forma
basis with the covenants contained in Articles IX and X
hereof, and (D) attached thereto are the financial projections
previously delivered to the Administrative Agent representing
the good faith opinions of the Borrower and senior management
thereof as to the projected results contained therein.
(iii) Payment at Closing. The Borrower shall have
paid the fees set forth or referenced in Section 4.3 and, to
the extent that the Borrower has been notified of the amount
thereof at least two (2) Business Days prior to the Closing
Date, any other accrued and unpaid fees or commissions due
hereunder (including, without limitation, legal fees and
expenses) to the Administrative Agent and Lenders, and to any
other Person such amount as may be due thereto in connection
with the transactions contemplated hereby, including all
taxes, fees and other charges in connection with the
execution, delivery, recording, filing and registration of any
of the Loan Documents.
(e) Miscellaneous.
(i) Notice of Borrowing. The Administrative Agent
shall have received a Notice of Borrowing from the Borrower in
accordance with Section 2.2(a), and a Notice of Account
Designation specifying the account or accounts to which the
proceeds of Loans made on and after the Closing Date are to be
disbursed.
(ii) Payment of IFG Debt. (A) All indebtedness and
obligations of IFG arising under that certain Amended and
Restated Credit Agreement dated as
39
of March 19, 1997 between IFG, the Lenders party thereto (the
"IFG Lenders"), First Union as Administrative Agent and
Xxxxxx as Syndication Agent (collectively, the "IFG Credit
Agreement Agents") (as amended, the "IFG Credit Agreement")
shall have been paid and satisfied in full, (B) the Borrower
and its Subsidiaries, and their respective assets and
properties, shall have been released from all guarantees,
liens, pledges and other security arrangements in favor of
the IFG Lenders and the IFG Credit Agreement Agents, and (C)
the Borrower shall have provided the Agents with evidence
reasonably satisfactory to the Agents and the Lenders
reflecting the termination of such security arrangements.
SECTION 5.3 Conditions to All Loans and Letters of Credit. The
obligation of the Lenders to make any Loan or of the Issuing Lender to issue any
Letter of Credit is subject to the satisfaction of the following conditions
precedent on the relevant borrowing or issue date, as applicable:
(a) Continuation of Representations and Warranties. The
representations and warranties of the Borrower and its Subsidiaries
contained in Article VI and in the other Loan Documents shall be true
and correct in all material respects on and as of such borrowing or
issuance date with the same effect as if made on and as of such date
except to the extent that such representations and warranties expressly
relate to an earlier date (in which case such representations and
warranties shall have been true and correct in all material respects on
and as of such earlier date).
(b) No Existing Default. No Default or Event of Default shall
have occurred and be continuing (i) on the borrowing date with respect
to such Loan or after giving effect to the Loans to be made on such
date or (ii) on the issue date with respect to such Letter of Credit or
after giving effect to such Letter of Credit to be issued on such date.
(c) Notice of Borrowing. The Administrative Agent shall have
received the Notice of Borrowing with respect to any Loan.
(d) Application. The Issuing Lender shall have received an
Application with respect to any Letter of Credit.
ARTICLE VI
REPRESENTATIONS AND WARRANTIES OF THE BORROWER
SECTION 6.1 Representations and Warranties. To induce the
Administrative Agent and Lenders to enter into this Agreement, the Lenders to
make Loans and the Issuing Lender to issue Letters of Credit, the Borrower
hereby represents and warrants to the Administrative Agent and Lenders that:
(a) Organization; Power; Qualification. Each of the Borrower
and its Subsidiaries is duly organized, validly existing and in good
standing under the laws of the jurisdiction of its incorporation or
formation, has the power and authority to own its
40
properties and to carry on its business as now being and hereafter proposed to
be conducted and is duly qualified and authorized to do business in each
jurisdiction in which the character of its properties or the nature of its
business requires such qualification and authorization, except where the failure
to so qualify could not reasonably be expected to have a Material Adverse
Effect. The jurisdictions in which the Borrower and its Subsidiaries are
organized are described on Schedule 6.1(a).
(b) Ownership. Each Restricted Subsidiary and each
Unrestricted Subsidiary as of the Closing Date is listed on Schedule
6.1(a). All outstanding shares or other equity interests have been duly
authorized and validly issued and, with respect to capital stock, are
fully paid and nonassessable. The holders of the capital stock or other
equity interests of the Subsidiaries of the Borrower as of the Closing
Date, are and the amount of capital stock or other equity interest
owned by each as of the Closing Date is described on Schedule 6.1(a).
As of the Closing Date, there are no outstanding stock purchase
warrants, subscriptions, options, securities, instruments or other
rights of any type or nature whatsoever, which are convertible into,
exchangeable for or otherwise provide for or permit the issuance of
capital stock or other equity interests of the Borrower or its
Subsidiaries, except as described on Schedule 6.1(a).
(c) Authorization of Agreement, Loan Documents and Borrowing.
Each of the Borrower and its Subsidiaries has the right, power and
authority and has taken all necessary corporate and other action to
authorize the execution, delivery and performance of this Agreement and
each of the other Loan Documents to which it is a party, the borrowings
hereunder and the transactions contemplated hereby and thereby, in each
case in accordance with their respective terms. This Agreement and each
of the other Loan Documents have been duly executed and delivered by
the duly authorized officers of the Borrower and each of its
Subsidiaries party thereto, and each such document constitutes the
legal, valid and binding obligation of the Borrower or its Subsidiary
party thereto, enforceable in accordance with its terms, except as such
enforcement may be limited by bankruptcy, insolvency, reorganization,
moratorium or similar state or federal debtor relief laws from time to
time in effect which affect the enforcement of creditors' rights in
general and the availability of equitable remedies.
(d) Compliance of Agreement, Loan Documents and Borrowing with
Laws, Etc. The execution, delivery and performance by the Borrower and
its Subsidiaries of the Loan Documents to which each such Person is a
party, in accordance with their respective terms, the borrowings
hereunder and the transactions contemplated hereby and thereby do not
and will not, by the passage of time, the giving of notice or
otherwise, (i) require any Governmental Approval which has not been
obtained or violate any Applicable Law relating to the Borrower or any
of its Subsidiaries, (ii) conflict with, result in a breach of or
constitute a default under the articles of incorporation, bylaws or
other organizational documents of the Borrower or any of its
Subsidiaries or any material indenture, agreement or other instrument
to which such Person is a party or by which any of its properties may
be bound or any material Governmental Approval relating to such Person,
or (iii) result in or require the creation or imposition of any Lien
upon or with respect to any property now owned or hereafter acquired by
such Person other than Liens arising under the Loan Documents and those
otherwise permitted hereunder.
41
(e) Compliance with Law; Governmental Approvals. Each of the
Borrower and its Subsidiaries (i) has all Governmental Approvals
required by any Applicable Law for it to conduct its business, each of
which is in full force and effect, is final and not subject to review
on appeal and is not the subject of any pending or, to the best of its
knowledge, threatened attack by direct or collateral proceeding, except
for such Governmental Approvals the absence of which could not
reasonably be expected to have a Material Adverse Effect and (ii) is in
compliance with each Governmental Approval applicable to it and in
compliance with all other Applicable Laws relating to it or any of its
respective properties, except in each case where the failure to so
comply could not reasonably be expected to have a Material Adverse
Effect.
(f) Tax Returns and Payments. Each of the Borrower and its
Subsidiaries has duly filed or caused to be filed all material federal,
state, local and other tax returns required by Applicable Law to be
filed, and has paid, or made adequate provision for the payment of, all
material federal, state, local and other taxes, assessments and
governmental charges or levies upon it and its property, income,
profits and assets which are due and payable except any nonpayment
permitted under Section 8.5. No Governmental Authority has asserted any
Lien or other material claim against the Borrower or any Subsidiary
with respect to unpaid taxes which could reasonably be expected to have
a Material Adverse Effect. The charges, accruals and reserves on the
books of the Borrower and its Subsidiaries in respect of federal,
state, local and other taxes for all Fiscal Years and portions thereof
since the organization of the Borrower and its Subsidiaries are in the
judgment of the Borrower adequate, and the Borrower does not anticipate
any additional taxes or assessments for any of such years, the result
of which could reasonably be expected to have a Material Adverse
Effect.
(g) Intellectual Property Matters. Each of the Borrower and
its Subsidiaries owns or possesses rights to use all franchises,
licenses, copyrights, copyright applications, patents, patent rights or
licenses, patent applications, trademarks, trademark rights, service
marks, service xxxx rights, trade names, trade name rights and rights
with respect to the foregoing which are required to conduct its
business, except where the failure to so own or possess such rights
could not reasonably be expected to have a Material Adverse Effect. No
event has occurred which permits, or after notice or lapse of time or
both would permit, the revocation or termination of any such rights,
and, to the best of its knowledge, neither the Borrower nor any
Subsidiary thereof is liable to any Person for infringement under
Applicable Law with respect to any such rights as a result of its
business operations, the result of which could reasonably be expected
to have a Material Adverse Effect.
(h) Environmental Matters.
(i) To the Borrower's Actual Knowledge, the
properties owned or managed by the Borrower and its
Subsidiaries do not contain, and to their Actual Knowledge
have not previously contained, any Hazardous Materials in
amounts or concentrations which (A) constitute or constituted
a violation of, or (B) could give rise to liability under,
applicable Environmental Laws, in each case which could
reasonably be expected to have a Material Adverse Effect;
42
(ii) To the Borrower's Actual Knowledge, such
properties and all operations of the Borrower and its
Subsidiaries are conducted in compliance in all respects, and
have been in compliance in all respects, with all applicable
Environmental Laws the violation of which could reasonably be
expected to have a Material Adverse Effect, and the Borrower
and its Subsidiaries have not caused contamination at, under
or about such properties or such operations which could
reasonably be expected to have a Material Adverse Effect;
(iii) Neither the Borrower nor any Subsidiary (a) has
received any notice of violation, alleged violation,
non-compliance, liability or potential liability regarding
environmental matters or compliance with Environmental Laws
with regard to any of their properties or their operations, or
(b) have Actual Knowledge that any such notice will be
received or is being overtly threatened, in each case which
could reasonably be expected to have a Material Adverse
Effect;
(iv) To the Borrower's Actual Knowledge, the Borrower
and its Subsidiaries have not caused Hazardous Materials to be
transported or disposed of from the properties of the Borrower
and its Subsidiaries in violation of, or in a manner or to a
location which gives rise to liability under, Environmental
Laws, which violation or liability could reasonably be
expected to have a Material Adverse Effect, nor to the
Borrower's Actual Knowledge have the Borrower and its
Subsidiaries caused any Hazardous Materials to be generated,
treated, stored or disposed of at, on or under any of such
properties in violation of, or in a manner that could give
rise to liability under, any applicable Environmental Laws
which could reasonably be expected to have a Material Adverse
Effect;
(v) No judicial proceedings or governmental or
administrative action is pending, or, to the Actual Knowledge
of the Borrower, overtly threatened, under any Environmental
Law to which the Borrower or any Subsidiary is or will be
named as a party with respect to such properties or operations
of the Borrower and its Subsidiaries conducted thereon, nor
are there any consent decrees or other decrees, consent
orders, administrative orders or other orders, or other
administrative or judicial requirements outstanding under any
Environmental Law with respect to such properties or such
operations which in each case could reasonably be expected to
have a Material Adverse Effect; and
(vi) To its Actual Knowledge, neither the Borrower
nor its Subsidiaries have caused any release, or to the
Borrower's Actual Knowledge, the threat of release, of
Hazardous Materials at or from such properties, in violation
of or in amounts or in a manner that gives rise to liability
under Environmental Laws, in each case which could reasonably
be expected to have a Material Adverse Effect.
(i) ERISA.
(i) Neither the Borrower nor any ERISA Affiliate
maintains or contributes to, or has any obligation under, any
Employee Benefit Plans other than
43
those identified on Schedule 6.1(i);
(ii) the Borrower and each ERISA Affiliate is in
material compliance with all applicable provisions of ERISA
and the regulations and published interpretations thereunder
with respect to all Employee Benefit Plans except for any
required amendments for which the remedial amendment period as
defined in Section 401(b) of the Code has not yet expired. No
material liability has been incurred by the Borrower or any
ERISA Affiliate which remains unsatisfied for any taxes or
penalties with respect to any Employee Benefit Plan or any
Multiemployer Plan;
(iii) No Pension Plan of the Borrower has been
terminated, and to the knowledge of the Borrower no Pension
Plan of any ERISA Affiliate has been terminated, nor has any
accumulated funding deficiency (as defined in Section 412 of
the Code) been incurred (without regard to any waiver granted
under Section 412 of the Code), nor has any funding waiver
from the Internal Revenue Service been received or requested
with respect to any Pension Plan, nor has the Borrower or any
ERISA Affiliate failed to make any contributions or to pay any
amounts due and owing as required by Section 412 of the Code,
Section 302 of ERISA or the terms of any Pension Plan prior to
the due dates of such contributions under Section 412 of the
Code or Section 302 of ERISA, nor has there been any event
requiring any disclosure under Section 4041(c)(3)(C) or
4063(a) of ERISA with respect to any Pension Plan, in each
case which could reasonably be expected to result in a
Material Adverse Effect;
(iv) Neither the Borrower nor any ERISA Affiliate
has: (A) engaged in a nonexempt prohibited transaction
described in Section 406 of the ERISA or Section 4975 of the
Code, (B) incurred any liability to the PBGC which remains
outstanding other than the payment of premiums and there are
no premium payments which are due and unpaid, (C) failed to
make a required contribution or payment to a Multiemployer
Plan, or (D) failed to make a required installment or other
required payment under Section 412 of the Code;
(v) No Termination Event has occurred or, to the
knowledge of the Borrower, is reasonably expected to occur;
and
(vi) No proceeding, claim, lawsuit and/or
investigation (other than routine claims for benefits in the
ordinary course) is existing or, to the best knowledge of the
Borrower after due inquiry, threatened concerning or involving
any (A) employee welfare benefit plan (as defined in Section
3(1) of ERISA) currently maintained or contributed to by the
Borrower or any ERISA Affiliate or (B) Pension Plan.
(j) Margin Stock. No part of the proceeds of any of the Loans
or Letters of Credit will be used for purchasing or carrying margin
stock or for any purpose which violates, or which would be inconsistent
with, the provisions of Regulation T, U or X of the Board of Governors
of the Federal Reserve System.
44
(k) Government Regulation. Neither the Borrower nor any
Subsidiary thereof is an "investment company" or a company "controlled"
by an "investment company" (as each such term is defined or used in the
Investment Company Act of 1940, as amended) and neither the Borrower
nor any Subsidiary thereof is, or after giving effect to any Extension
of Credit will be, subject to regulation under the Public Utility
Holding Company Act of 1935 or the Interstate Commerce Act, each as
amended, or any other Applicable Law which limits its ability to incur
or consummate the transactions contemplated hereby.
(l) Material Contracts. Schedule 6.1(l) sets forth a complete
and accurate list of all Material Contracts of the Borrower and its
Subsidiaries in effect as of the Closing Date; other than as set forth
in Schedule 6.1(l), each such Material Contract is, and after giving
effect to the consummation of the transactions contemplated by the Loan
Documents will be, in full force and effect on the Closing Date in
accordance with the terms thereof. The Borrower and its Subsidiaries
have delivered to the Administrative Agent a true and complete copy of
each Material Contract required to be listed on Schedule 6.1(l) or any
other Schedule hereto.
(m) Employee Relations. Each of the Borrower and its
Subsidiaries has an adequate work force in place and is not, as of the
Closing Date, party to any collective bargaining agreement nor has any
labor union been recognized as the representative of its employees. The
Borrower knows of no pending or threatened strikes, work stoppage or
similar collective labor actions involving its employees or those of
its Subsidiaries, which could reasonably be expected to have a Material
Adverse Effect.
(n) Financial Statements. The Consolidated balance sheet of
the Borrower and its Subsidiaries as of December 31, 1997 and the
related statements of income and retained earnings and cash flows for
the Fiscal Year then ended, copies of which have been furnished to the
Administrative Agent and each Lender, are complete and correct and
fairly present in all material respects the assets, liabilities and
financial position of the Borrower and its Subsidiaries as at such
dates, and the results of the operations and changes of financial
position for the periods then ended. All such financial statements,
including the related schedules and notes thereto, have been prepared
in accordance with GAAP. The Borrower and its Subsidiaries have no
Debt, obligation or other unusual forward or long-term commitment which
is not fairly reflected in the foregoing financial statements or in the
notes thereto.
(o) No Material Adverse Change. Since December 31, 1997, there
has been no material adverse change in the business, operations,
prospects, or condition (financial or otherwise) of the Borrower and
its Subsidiaries, taken as a whole (it being understood that the
spin-off of the Borrower from IFG does not constitute such a material
adverse change), and no event (other than such spin-off) has occurred
or condition arisen that could reasonably be expected to have a
Material Adverse Effect.
(p) Solvency. As of the Closing Date and after giving effect
to each Extension of Credit hereunder, the Borrower and each of its
Subsidiaries is and will be Solvent.
45
(q) Titles to Properties. Each of the Borrower and its
Subsidiaries has such title to the real property owned by it as is
necessary or desirable to the conduct of its business and valid and
legal title to all of its personal property and assets, including, but
not limited to, those reflected on the balance sheets of the Borrower
and its Subsidiaries referred to in Section 6.1(n), except those which
have been disposed of by the Borrower or its Subsidiaries subsequent to
such date which dispositions have been in the ordinary course of
business or as otherwise expressly permitted hereunder.
(r) Liens. None of the properties and assets of the Borrower
or any Subsidiary is subject to any Lien, except Liens permitted
pursuant to Section 10.3.
(s) Debt and Contingent Obligations. Schedule 6.1(s) is a
complete and correct listing of all Debt and Contingent Obligations of
the Borrower and its Subsidiaries as of the Closing Date in excess of
$1,000,000. The Borrower and its Subsidiaries have performed and are in
material compliance with all of the terms of such Debt and Contingent
Obligations and all instruments and agreements relating thereto.
(t) Litigation. Except for matters existing as of the Closing
Date and set forth either in the public filings of the Borrower with
the Securities and Exchange Commission made prior to the Closing Date
or on Schedule 6.1(t), there are no actions, suits or proceedings
pending nor, to the knowledge of the Borrower, threatened against or in
any other way relating adversely to or affecting the Borrower or any
Subsidiary thereof or any of their respective properties in any court
or before any arbitrator of any kind or before or by any Governmental
Authority which individually or in the aggregate could reasonably be
expected to have a Material Adverse Effect.
(u) Absence of Defaults. No event has occurred or is
continuing which (i) constitutes a Default or an Event of Default, or
(ii) constitutes, or which with the passage of time or giving of notice
or both would constitute, a default or event of default by the Borrower
or any Subsidiary thereof under any Material Contract or judgment,
decree or order to which the Borrower or its Subsidiaries is a party or
by which the Borrower or its Subsidiaries or any of their respective
properties may be bound, which could reasonably be expected to have a
Material Adverse Effect or which would require the Borrower or any of
its Subsidiaries to make any payment thereunder in excess of $1,000,000
prior to the scheduled maturity date therefor.
(v) Accuracy and Completeness of Information. The factual
statements contained in the financial statements referred to in
Sections 7.1(a) and (b) and the Loan Documents (including the schedules
thereto), and any other certificates or documents furnished or to be
furnished to the Administrative Agent or the Lenders from time to time
in connection with this Agreement, taken as a whole, did not as of the
date when made, contain any untrue statement of a material fact or omit
to state a material fact necessary in order to make the statements
contained therein not misleading in light of the circumstances in which
the same were made, all except as otherwise qualified herein or
therein; provided that, with respect to factual statements made by
Persons other than the Borrower or any of
46
its Subsidiaries, such representation and warranty is made only to the
knowledge of the Borrower.
(w) Year 2000 Compliance. The Borrower has (i) initiated a
review and assessment of all areas within its and each of its
Subsidiaries' business and operations (including those affected by
suppliers, vendors and customers) that could be adversely affected by
the "Year 2000 Problem" (that is, the risk that computer applications
used by the Borrower or any of its Subsidiaries may be unable to
recognize and perform properly date-sensitive functions involving
certain dates prior to and any date after December 31, 1999), (ii)
developed a plan and timetable for addressing the Year 2000 Problem on
a timely basis, and (iii) to date, used its best efforts to implement
such plan in accordance with such timetable. Based on the foregoing,
the Borrower believes that all computer applications that are material
to its or any of its Subsidiaries' business and operations are
reasonably expected on a timely basis to be able to perform properly
date-sensitive functions for all dates before and after January 1, 2000
(that is, be "year 2000 compliant"), except to the extent that a
failure to do so could not reasonably be expected to have Material
Adverse Effect.
The Borrower has and will continue to use its best efforts to
determine whether the material suppliers, vendors and customers of the
Borrower and its Subsidiaries will prevent the Borrower or any of its
Subsidiaries from being year 2000 compliant, and the Borrower is not
aware that any material supplier, vendor or customer will prevent the
Borrower or any of its Subsidiaries from being year 2000 compliant in a
manner which would reasonably be expected to have a Material Adverse
Effect.
Nothing in this Section 6.1(w) shall obligate the Borrower or any
Subsidiary thereof to ensure that computer based systems of its suppliers,
vendors or customers are able to operate and effectively process data which
includes dates on and after January 1, 2000.
SECTION 6.2 Survival of Representations and Warranties, Etc. All
representations and warranties set forth in this Article VI and all
representations and warranties of the Borrower and its Subsidiaries contained in
any certificate, or any of the Loan Documents (including but not limited to any
such representation or warranty made in or in connection with any amendment
thereto) shall constitute representations and warranties made under this
Agreement. All representations and warranties made under this Agreement shall be
made or deemed to be made at and as of the Closing Date, shall survive the
Closing Date and shall not be waived by the execution and delivery of this
Agreement, any investigation made by or on behalf of the Lenders or any
borrowing hereunder.
ARTICLE VII
FINANCIAL INFORMATION AND NOTICES
Until all the Obligations have been paid and satisfied in full and the
Commitments terminated, unless consent has been obtained in the manner set forth
in Section 13.9 hereof, the Borrower will furnish or cause to be furnished to
the Administrative Agent and to the Lenders at
47
their respective addresses as set forth on Schedule 1.1(a), or such other office
as may be designated by the Administrative Agent and Lenders from time to time:
SECTION 7.1 Financial Statements and Projections.
(a) Quarterly Financial Statements. As soon as practicable and in any
event within forty-five (45) days after the end of each fiscal quarter (other
than the last fiscal quarter of each fiscal year), an unaudited Consolidated
balance sheet of the Borrower and its Subsidiaries as of the close of such
fiscal quarter and unaudited Consolidated statements of income, retained
earnings and cash flows for the fiscal quarter then ended and that portion of
the Fiscal Year then ended, including the notes thereto, all in reasonable
detail setting forth in comparative form the corresponding figures for the
corresponding date and periods in the preceding Fiscal Year and prepared by the
Borrower in accordance with GAAP and, if applicable, containing disclosure of
the effect on the financial position or results of operations of any change in
the application of accounting principles and practices during the period, and
certified by the chief financial officer of the Borrower to present fairly in
all material respects the financial condition of the Borrower and its
Subsidiaries as of their respective dates and the results of operations of the
Borrower and its Subsidiaries for the respective periods then ended, subject to
normal year end adjustments.
(b) Annual Financial Statements. As soon as practicable and in any
event within one hundred twenty (120) days after the end of each Fiscal Year, an
audited Consolidated balance sheet filed by the Borrower and its Subsidiaries as
of the close of such Fiscal Year and audited Consolidated statements of income,
retained earnings and cash flows for the Fiscal Year then ended, including the
notes thereto, all in reasonable detail setting forth in comparative form the
corresponding figures as of the end of and for the preceding Fiscal Year and
prepared by an independent certified public accounting firm acceptable to the
Administrative Agent in accordance with GAAP and, if applicable, containing
disclosure of the effect on the financial position or results of operations of
any change in the application of accounting principles and practices during the
year, and accompanied by a report thereon by such certified public accountants
that is not qualified with respect to scope limitations imposed by the Borrower
or any of its Subsidiaries or with respect to accounting principles followed by
the Borrower or any of its Subsidiaries not in accordance with GAAP.
(c) Annual Business Plan and Financial Models. As soon as practicable
and in any event not later than March 30 of each Fiscal Year, a budget of the
Borrower and its Subsidiaries for such Fiscal Year, such plan to be prepared in
a form and on a basis similar to the plan(s) previously furnished to the Lenders
and to include, on a quarterly basis, the following: an operating and capital
budget, an income statement, a statement of cash flows and a balance sheet,
accompanied by a certificate from the chief financial officer of the Borrower,
on behalf of the Borrower, to the effect that, to the best of such officer's
knowledge, such information is a good faith estimate of the financial condition
and operations of the Borrower and its Subsidiaries for such period.
SECTION 7.2 Officer's Compliance Certificate. At each time reports are
delivered pursuant to Sections 7.1 (a) or (b) and at such other times as the
Administrative Agent shall reasonably request, a certificate of the chief
financial officer or the treasurer of the Borrower in the form of Exhibit G
attached hereto (an "Officer's Compliance Certificate"),
48
which shall include a schedule of all earn-out obligations.
SECTION 7.3 Other Reports.
(a) Promptly but in any event within ten (10) Business Days after the
filing thereof, a copy of (i) each report or other filing made by the Borrower
or any of its Subsidiaries with the SEC and required by the SEC to be delivered
to the shareholders of the Borrower or any of its Subsidiaries, and (ii) each
report made by the Borrower or any of its Subsidiaries to the SEC on Form 8-K
and each final registration statement of the Borrower or any of its Subsidiaries
filed with the SEC (excluding any registration statement on Form S-8 or its
equivalent); and
(b) Such other information regarding the operations, business affairs
and financial condition of the Borrower or any of its Subsidiaries as the
Administrative Agent or any Lender (acting through the Administrative Agent) may
reasonably request.
SECTION 7.4 Notice of Litigation and Other Matters. Prompt (but in no
event later than ten (10) days after an officer of the Borrower obtains
knowledge thereof) telephonic and written notice of:
(a) the commencement of all proceedings and investigations by
or before any Governmental Authority and all actions and proceedings in
any court or before any arbitrator against or involving the Borrower or
any Subsidiary or any of their respective properties, assets or
businesses which if determined adversely to the Borrower or such
Subsidiary, individually or in the aggregate could reasonably be
expected to have a Material Adverse Effect;
(b) any notice of any violation received by the Borrower or
any Subsidiary from any Governmental Authority (including, without
limitation, any notice of violation of Environmental Laws) which in any
such case could reasonably be expected to have a Material Adverse
Effect;
(c) any labor controversy that has resulted in, or threatens
to result in, a strike against the Borrower or any Subsidiary;
(d) any Default or Event of Default, or any event which
constitutes or which with the passage of time or giving of notice or
both would constitute a default or event of default by the Borrower or
any of its Subsidiaries under any Material Contract to which the
Borrower or any of its Subsidiaries is a party or by which the Borrower
or any Subsidiary thereof or any of their respective properties may be
bound;
(e) (i) any unfavorable determination letter from the Internal
Revenue Service regarding the qualification of an Employee Benefit Plan
under Section 401(a) of the Code (along with a copy thereof), (ii) all
notices received by the Borrower or any ERISA Affiliate of the PBGC's
intent to terminate any Pension Plan or to have a trustee appointed to
administer any Pension Plan, (iii) all notices received by the Borrower
or any ERISA Affiliate from a Multiemployer Plan sponsor concerning the
imposition or amount of withdrawal liability pursuant to Section 4202
of ERISA and (iv) the Borrower obtaining
49
knowledge or reason to know that the Borrower or any ERISA Affiliate
has filed or intends to file a notice of intent to terminate any
Pension Plan under a distress termination within the meaning of Section
4041(c) of ERISA; and
(f) any event which makes any of the representations set forth
in Section 6.1 inaccurate in any material respect or any event which
could reasonably be expected to have a Material Adverse Effect.
SECTION 7.5 Accuracy of Information. All written information, reports,
statements and other papers and data furnished by or on behalf of the Borrower
to the Administrative Agent or any Lender (other than financial forecasts)
whether pursuant to this Article VII or any other provision of this Agreement,
or any of the other Loan Documents, shall be, at the time the same is so
furnished, complete and correct in all material respects to the extent necessary
to give the Administrative Agent or any Lender complete, true and accurate
knowledge of the subject matter based on the Borrower's knowledge thereof.
ARTICLE VIII
AFFIRMATIVE COVENANTS
Until all of the Obligations have been finally paid and satisfied in
full and the Commitments terminated, unless consent has been obtained in the
manner provided for in Section 13.9, the Borrower will, and will cause each of
its Subsidiaries to:
SECTION 8.1 Preservation of Corporate Existence and Related Matters.
Except as permitted by Section 10.5, preserve and maintain its separate
existence as a corporation, partnership or other applicable form of business
entity and all rights, franchises, licenses and privileges necessary to the
conduct of its business, and qualify and remain qualified as a foreign
corporation, partnership or other such entity and authorized to do business in
each jurisdiction in which the failure to so qualify could reasonably be
expected to have a Material Adverse Effect.
SECTION 8.2 Maintenance of Property. Protect and preserve all
properties useful in and material to its business, including copyrights,
patents, trade names and trademarks and service marks; maintain in good working
order and condition all buildings, equipment and other tangible real and
personal property; and from time to time make or cause to be made all renewals,
replacements and additions to such property necessary for the conduct of its
business, so that the business carried on in connection therewith may be
properly and advantageously conducted at all times; except in each case where
the failure to take such action could not reasonably be expected to have a
Material Adverse Effect.
SECTION 8.3 Insurance. Maintain insurance with financially sound and
reputable insurance companies against such risks and in such amounts as are
customarily maintained by similar businesses and as may be required by
Applicable Law, and from time to time deliver to the Administrative Agent upon
its request a detailed list of the insurance then in effect, stating the names
of the insurance companies, the amounts and rates of the insurance, the dates of
the expiration thereof and the properties and risks covered thereby.
50
SECTION 8.4 Accounting Methods and Financial Records. Maintain a system
of accounting, and keep such books, records and accounts (which shall be true
and complete in all material respects) as may be required or as may be necessary
to permit the preparation of financial statements in accordance with GAAP and in
compliance with the regulations of any Governmental Authority having
jurisdiction over it or any of its properties.
SECTION 8.5 Payment and Performance of Obligations. Pay and perform all
Obligations under this Agreement and the other Loan Documents, and pay or
perform (a) all material taxes, assessments and other governmental charges that
may be levied or assessed upon it or any of its property, and (b) all other
material indebtedness, obligations and liabilities in accordance with customary
trade practices; provided, that the Borrower or such Subsidiary may contest any
item described in clauses (a) or (b) of this Section 8.5 in good faith so long
as adequate reserves are maintained with respect thereto in accordance with
GAAP.
SECTION 8.6 Compliance With Laws and Approvals. Subject to Section 8.7,
observe and remain in compliance with all Applicable Laws and maintain in full
force and effect all Governmental Approvals, in each case applicable to the
conduct of its business except where the failure to do so could not reasonably
be expected to have a Material Adverse Effect.
SECTION 8.7 Environmental Laws. (a) Use reasonable commercial efforts
to comply with all applicable Environmental Laws and use reasonable commercial
efforts to obtain, comply with and maintain any and all licenses, approvals,
notifications, registrations or permits required by applicable Environmental
Laws, in each case where the failure to so obtain or comply with which could
reasonably be expected to have a Material Adverse Effect, and (b) defend,
indemnify and hold harmless the Agents and Lenders, and their respective
parents, Subsidiaries, Affiliates, employees, agents, officers and directors,
from and against any claims, demands, penalties, fines, liabilities, settlements
authorized by the Borrower, damages, costs and expenses of whatever kind or
nature known or unknown, contingent or otherwise, arising out of, or in any way
relating to the violation of, noncompliance with or liability under any
Environmental Laws applicable to the operations of the Borrower or its
Restricted Subsidiaries, or any orders, requirements or demands of Governmental
Authorities related thereto, including, without limitation, reasonable
attorney's and consultant's fees, investigation and laboratory fees, response
costs, court costs and litigation expenses, except to the extent that any of the
foregoing directly result from the gross negligence or willful misconduct of the
party seeking indemnification therefor. Notwithstanding anything in this
Agreement to the contrary, the obligations of the Borrower under this Section
8.7 shall survive the payment in full of the Obligations and the termination of
the Commitments.
SECTION 8.8 Compliance with ERISA. In addition to and without limiting
the generality of Section 8.6, and to the extent any of the following,
individually or in the aggregate, results or could reasonably be expected to
result in a Material Adverse Effect, (a) comply in all material respects with
all applicable provisions of ERISA and the regulations and published
interpretations thereunder with respect to all Employee Benefit Plans, (b) not
take any action or fail to take action the result of which could be a liability
to the PBGC or to a Multiemployer Plan, (c) not participate in any prohibited
transaction that could result in any material civil penalty under ERISA or tax
under the Code, (d) operate each Employee Benefit
51
Plan in such a manner that will not incur any material tax liability under
Section 4980B of the Code or any liability to any qualified beneficiary as
defined in Section 4980B of the Code and (e) furnish to the Administrative Agent
upon the Administrative Agent's request such additional information about any
Employee Benefit Plan as may be reasonably requested by the Administrative
Agent.
SECTION 8.9 Compliance With Agreements. Comply in all respects with
each term, condition and provision of all leases, agreements and other
instruments entered into in the conduct of its business including, without
limitation, any Material Contract, except where the failure to comply could not
reasonably be expected to have a Material Adverse Effect; provided, that the
Borrower or such Subsidiary may contest any such lease, agreement or other
instrument in good faith through applicable proceedings so long as adequate
reserves are maintained in accordance with GAAP.
SECTION 8.10 Conduct of Business. Engage only in businesses in
substantially the same fields as the businesses conducted on the Closing Date
and those related thereto.
SECTION 8.11 Visits and Inspections. Permit representatives of the
Administrative Agent or any Lender (acting through the Administrative Agent),
from time to time, upon reasonable prior notice, during normal business hours
and, so long as no Default or Event of Default shall have occurred and be
continuing, at the sole cost of the Administrative Agent or such Lender, to (a)
visit and inspect its properties; (b) inspect, audit and make extracts from its
books, records and files, including, but not limited to, management letters
prepared by independent accountants; and (c) discuss with its principal
officers, and its independent accountants, its business, assets, liabilities,
financial condition, results of operations and business prospects.
SECTION 8.12 Subsidiaries. Concurrently with the creation or
acquisition of any Subsidiary, (a) if such Subsidiary is a domestic Restricted
Subsidiary (unless such Subsidiary has no material assets other than capital
stock of foreign Subsidiaries, in which event such domestic Restricted
Subsidiary shall be deemed not to be a domestic Subsidiary and the provisions of
clause (b) below shall apply), cause it to execute and deliver to the
Administrative Agent (i) a supplement to the Guaranty Agreement delivered on the
Closing Date substantially in the form of Exhibit A to such Guaranty Agreement
and (ii) either (A) if such Subsidiary is a Subsidiary of a Person who is a
pledgor under an existing Pledge and Security Agreement, a supplement
substantially in the form of Exhibit A to such Pledge and Security Agreement
with respect to one hundred percent (100%) of the ownership interests of such
Restricted Subsidiary and (B) if the owner of the capital stock or other
ownership interests in such Restricted Subsidiary is not such a pledgor, a
Pledge and Security Agreement, substantially in the form of Exhibit I, executed
by such Person with respect to one hundred percent (100%) of the ownership
interest in such Restricted Subsidiary, (b) if such Restricted Subsidiary is not
a domestic Subsidiary but is owned by the Borrower or one or more domestic
Subsidiaries, cause the owner of the capital stock or other ownership interests
therein to provide to the Administrative Agent for the benefit of the Lenders a
first priority, perfected security interest in 65% of the issued and outstanding
capital stock of such Restricted Subsidiary which is owned by the pledgor,
pursuant to documentation which is in form and substance reasonably acceptable
to the Administrative Agent, (c) if such Subsidiary is an Unrestricted
Subsidiary, as
52
a condition precedent to the creation or acquisition of such Unrestricted
Subsidiary, demonstrate to the Administrative Agent pro forma compliance with
all applicable covenants in this Agreement after giving effect to such creation
or acquisition, and (d) regardless of whether such Restricted Subsidiary is a
domestic Subsidiary, cause to be delivered to the Administrative Agent such
other documents as the Agents or Required Lenders shall reasonably request in
connection therewith, including without limitation, officers' certificates,
financial statements, opinions of counsel, resolutions, charter documents,
certificates of existence and authority to do business and any other closing
certificates and documents described in Section 5.2 and such stock certificates,
stock powers, UCC Financing Statements and notices as the Administrative Agent
may reasonably deem necessary to perfect its Lien for the benefit of the Lenders
thereon. At all times during the term of this Agreement the Borrower and its
Restricted Subsidiaries shall account for at least 95% of the total revenues of
the Borrower and its Consolidated Subsidiaries.
SECTION 8.13 Year 2000 Compatibility.
(a) Borrower Systems. Use commercially reasonable efforts to assure
that the computer based systems of the Borrower and any Subsidiary thereof
(other than computer related products provided to the Borrower by independent
contractors or third party product vendors for direct or indirect sale or resale
to customers of the Borrower or any Subsidiary thereof) which are primarily
responsible for processing date related data in the normal conduct of the
business of the Borrower or any Subsidiary thereof are able to operate and
effectively process data which includes dates on and after January 1, 2000. At
the reasonable request of the Administrative Agent, the Borrower shall provide
reasonable assurances satisfactory to the Administrative Agent of the Year 2000
compatibility of the Borrower or any Subsidiary thereof or plans therefor.
(b) Product Vendor Systems. Request that all of the material third
party product vendors and independent contractors of computer related products
for the Borrower and its Subsidiaries which are primarily responsible for
processing date related data in the ordinary use of such systems and are
intended for direct or indirect sale or resale to customers of the Borrower or
any Subsidiary thereof (i) certify that such systems are able to operate and
effectively process data which includes dates on and after January 1, 2000 or
(ii) provide a description of such third party vendor's plans to be able to
deliver the certification described in clause (i) above. At the reasonable
request of the Administrative Agent, the Borrower shall provide copies of any
plans delivered by third party product vendors pursuant to clause (ii) above.
Nothing in this Section 8.13 shall obligate the Borrower or any Subsidiary
thereof to ensure that computer based systems of its customers are able to
operate and effectively process data which includes dates on and after January
1, 2000.
SECTION 8.14 Further Assurances. Make, execute and deliver all such
additional and further acts, things, deeds and instruments as the Administrative
Agent or any Lender through the Administrative Agent may reasonably require to
document and consummate the transactions contemplated hereby and to vest
completely in and insure the Administrative Agent and the Lenders their
respective rights under this Agreement, the Notes
53
and the other Loan Documents.
ARTICLE IX
FINANCIAL COVENANTS
Until all of the Obligations have been finally paid and satisfied in
full and the Commitments terminated, unless consent has been obtained in the
manner set forth in Section 13.9 hereof, the Borrower will not:
SECTION 9.1 Leverage Ratio. As of the end of any fiscal quarter, permit
the ratio of (a) Total Debt as of such date to (b) EBITDA for the period of four
(4) consecutive fiscal quarters ending on such date, to exceed 3.0 to 1.0.
SECTION 9.2 Minimum Net Worth. Permit, as of any fiscal quarter end,
Consolidated Net Worth to be less than the sum of (a) $300,000,000 plus (b)
fifty percent (50%) of cumulative Net Income for each quarter for which Net
Income is greater than zero during the period commencing on the Closing Date and
ending on such fiscal quarter end (excluding the income (or loss) of any Person
accrued prior to the date it becomes a Subsidiary of the Borrower or is merged
into or consolidated with the Borrower) plus (c) seventy-five percent (75%) of
the Net Cash Proceeds of any equity issuance by the Borrower or any of its
Restricted Subsidiaries subsequent to the Closing Date.
SECTION 9.3 Maximum Leverage. Permit, as of any fiscal quarter end, the
ratio of (a) Total Debt as of such fiscal quarter end to (b) Total
Capitalization as of such fiscal quarter end to exceed 0.30 to 1.00.
SECTION 9.4 Interest Coverage Ratio. Permit, as of any fiscal quarter
end, the ratio of (a) EBITDA for the period of four (4) consecutive fiscal
quarters ending on such fiscal quarter end to (b) Interest Expense for such
period, to be less than 3.50 to 1.0.
ARTICLE X
NEGATIVE COVENANTS
Until all of the Obligations have been finally paid and satisfied in
full and the Commitments terminated, unless consent has been obtained in the
manner set forth in Section 13.9 hereof, the Borrower will not and will not
permit any of its Restricted Subsidiaries to:
SECTION 10.1 Limitations on Debt. Create, incur, assume or suffer to
exist any Debt except:
(a) the Obligations;
54
(b) Debt incurred in connection with a Hedging Agreement with
either (i) a counterparty and upon terms and conditions reasonably
satisfactory to the Agents or (ii) a Lender;
(c) Subordinated Debt not to exceed an aggregate of
$100,000,000 at any time outstanding;
(d) existing Debt set forth on Schedule 6.1(s) and the renewal
and refinancing (but not the increase) thereof;
(e) Debt of the Borrower and its Restricted Subsidiaries
incurred in connection with the acquisition of fixed or capital assets
(including, without limitation, Capitalized Leases) in an aggregate
amount not to exceed $5,000,000 on any date of determination;
(f) Debt consisting of Contingent Obligations permitted by
Section 10.2;
(g) Debt of Restricted Subsidiaries to each other, Debt of the
Borrower to its Restricted Subsidiaries or Debt of any Restricted
Subsidiary to the Borrower;
(h) Debt of Subsidiaries acquired in any acquisition and any
refinancings, renewals or extensions of such Debt; provided that such
Debt is non-recourse to the Borrower and its Subsidiaries (other than
the Subsidiaries so acquired and any Persons with which such
Subsidiaries are merged);
(i) Debt in the form of earn-out obligations; and
(j) Other Debt of the Borrower and its Restricted Subsidiaries
not to exceed an aggregate of $10,000,000 at any time outstanding.
SECTION 10.2 Limitations on Contingent Obligations. Create, incur,
assume or suffer to exist any Contingent Obligations except:
(a) Contingent Obligations in favor of the Administrative
Agent for the benefit of the Agents and the Lenders;
(b) Contingent Obligations of the Borrower on account of Debt
of its Restricted Subsidiaries, and Contingent Obligations of
Restricted Subsidiaries on account of Debt of the Borrower and its
Restricted Subsidiaries, to the extent that such Debt is permitted by
Section 10.1;
(c) Contingent Obligations on account of Debt of Unrestricted
Subsidiaries to the extent such Debt is permitted by Section 10.4(e);
(d) Contingent Obligations of Subsidiaries acquired in any
acquisition; provided that such Contingent Obligations are non-recourse
to the Borrower and its Subsidiaries other than the Subsidiaries so
acquired and any Persons with which such Subsidiaries are merged; and
55
(e) Other Contingent Obligations of the Borrower and its
Restricted Subsidiaries not to exceed an aggregate of $2,500,000 at any
time outstanding.
SECTION 10.3 Negative Pledge; Limitation on Liens. Create, incur,
assume or suffer to exist any lien on or with respect to any of its assets or
properties (including the management agreements and shares of capital stock and
other ownership interests), real or personal, whether now owned or hereafter
acquired, except:
(a) Liens for taxes, assessments and other governmental
charges or levies (excluding any Lien imposed pursuant to any of the
provisions of ERISA or Environmental Laws) not yet due or as to which
the period of grace (not to exceed thirty (30) days), if any, related
thereto has not expired or which are being contested in good faith and
by appropriate proceedings if adequate reserves are maintained to the
extent required by GAAP;
(b) the claims of materialmen, mechanics, carriers,
warehousemen, processors or landlords for labor, materials, supplies or
rentals incurred in the ordinary course of business, (i) which are not
overdue for a period of more than thirty (30) days or (ii) which are
being contested in good faith and by appropriate proceedings;
(c) Liens consisting of deposits or pledges made in the
ordinary course of business in connection with, or to secure payment
of, obligations under workers' compensation, unemployment insurance or
similar legislation or obligations under customer service contracts;
(d) Liens constituting encumbrances in the nature of zoning
restrictions, easements and rights or restrictions of record on the use
of real property, which in the aggregate are not substantial in amount
and which do not, in any case, detract from the value of such property
or impair the use thereof in the ordinary conduct of business;
(e) Liens of the Administrative Agent for the benefit of the
Agents and the Lenders;
(f) Existing Liens described on Schedule 10.3 and the
continuance or renewal of any such Liens in connection with any
refinancings, renewals or extensions of the Debt secured thereby;
(g) Liens securing purchase money Debt incurred under Section
10.1(e) or (j); provided that such liens do not at any time encumber
any property other than the property financed by such Debt;
(h) Liens not otherwise permitted hereunder securing Debt
permitted under Section 10.1 in an aggregate principal amount not to
exceed $10,000,000 at any one time outstanding;
56
(i) Liens on assets of Subsidiaries at the time of acquisition
by the Borrower or any Restricted Subsidiary, provided that there is no
recourse to the Borrower or its Restricted Subsidiaries with respect to
such Liens; and
(j) Liens on the equity interest in any Co-Investment Entity
securing obligations of such Co-Investment Entity.
SECTION 10.4 Limitations on Loans, Advances, Investments and
Acquisitions. Purchase, own, invest in or otherwise acquire, directly or
indirectly, any capital stock, interests in any partnership or joint venture,
evidence of Debt or other obligation or security, substantially all or a portion
of the business or assets of any other Person or any other investment or
interest whatsoever in any other Person, or make or permit to exist, directly or
indirectly, any loans, advances or extensions of credit to, or any investment in
cash or by delivery of property in, any Person, or enter into, directly or
indirectly, any commitment or option in respect of the foregoing except:
(a) investments in Unrestricted Subsidiaries and Affiliates
existing on the Closing Date and the other existing loans, advances and
investments described on Schedule 10.4;
(b) investments in (i) marketable direct obligations issued or
unconditionally guaranteed by the United States of America or any
agency thereof maturing within 120 days from the date of acquisition
thereof, (ii) marketable direct obligations issued by any State of the
United States or any political subdivision of any such State or any
public instrumentality thereof maturing within 120 days from the date
of acquisition thereof and, at the time of acquisition, having the
highest or second highest rating obtainable from S&P or Xxxxx'x; (iii)
commercial paper maturing within 120 days from the date of the
acquisition thereof, and, at the time of acquisition, having a rating
of A-1 or higher by S&P or P-1 or higher by Xxxxx'x, (iv) certificates
of deposit maturing no more than 120 days from the date of creation
thereof issued by commercial banks incorporated or licensed under the
laws of the United States of America, each having combined capital,
surplus and undivided profits of not less than $500,000,000 and having
a rating of A or better by a nationally recognized rating agency; (v)
time deposits maturing no more than 30 days from the date of creation
thereof with commercial banks or savings banks or savings and loan
associations each having membership either in the FDIC or the deposits
of which are insured by the FDIC and in amounts not exceeding the
maximum amounts of insurance thereunder; (vi) eligible bankers'
acceptances, repurchase agreements and tax-exempt municipal bonds
having a maturity of less than one year and in each case having a
rating, or being the full recourse obligation of a Person whose senior
debt rating has a rating, of A or higher by S&P or Xxxxx'x; or (vii)
any money market fund organized under the laws of the United States or
any State thereof;
(c) investments in the form of acquisitions of all or
substantially all of the business or a line of business (whether by the
acquisition of capital stock or other ownership interest, assets or any
combination thereof) of any other Person (or investments, including
loans and deposits, in anticipation thereof), if (i) no Default or
Event of Default then exists or would be created thereby, (ii) the
Borrower has delivered to the Agents and
57
the Lenders a certificate of the Chief Financial Officer or Treasurer
of the Borrower (on behalf of the Borrower) demonstrating pro forma
compliance with the covenants contained in Article IX after giving
effect to such acquisition and (iii) any acquired Person is, in the
reasonable opinion of the Borrower, in a similar or complementary line
of business to that of the Borrower or any of its Restricted
Subsidiaries;
(d) investments in or loans to Restricted Subsidiaries;
(e) investments in or loans to Unrestricted Subsidiaries,
provided that the aggregate amount of such loans and investments,
together with all Contingent Obligations of the Borrower and its
Restricted Subsidiaries on account of Debt of Unrestricted Subsidiaries
shall at no time exceed an amount equal to fifteen percent (15%) of the
Consolidated Net Worth of the Borrower and its Subsidiaries;
(f) (i) loans to officers and directors of the Borrower and
its Restricted Subsidiaries to finance the purchase of newly issued
capital stock of the Borrower pursuant to its executive stock purchase
program and (ii) other loans to executive officers and directors not to
exceed (in the case of this clause (ii)) an aggregate of $5,000,000 at
any time outstanding;
(g) investments in or loans to Controlled Co-Investment
Entities; and
(h) investments in or loans to Uncontrolled Co-Investment
Entities not to exceed an aggregate of $15,000,000 at any time
outstanding.
SECTION 10.5 Limitations on Mergers and Liquidation. Merge, consolidate
or enter into any similar combination with any other Person or liquidate,
wind-up or dissolve itself (or suffer any liquidation or dissolution) except:
(a) any Restricted Subsidiary may be merged or consolidated
with or into the Borrower or any other Restricted Subsidiary, or be
liquidated, wound up or dissolved;
(b) any Restricted Subsidiary may merge into the Person such
Restricted Subsidiary was formed to acquire in connection with an
acquisition permitted by Section 10.4(c); and
(c) any Person may merge with the Borrower or any Restricted
Subsidiary, provided such Person is engaged in a similar or
complementary line of business to that of the Borrower or any of its
Restricted Subsidiaries, no Event of Default or Default shall result
from such merger and, if such merger is with the Borrower, the Borrower
shall be the surviving Person.
SECTION 10.6 Limitations on Sale of Assets. Convey, sell, lease,
assign, transfer or otherwise dispose of any of its property, business or assets
(including, without limitation, any capital stock or other ownership interest in
any Subsidiary or Affiliate or the sale of any receivables and leasehold
interests and any sale-leaseback or similar transaction), whether now owned or
hereafter acquired except:
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(a) All or substantially all of the business or assets of any
Restricted Subsidiary may be conveyed, sold, assigned, leased,
transferred, or otherwise disposed of, in one transaction or a series
of transactions, to the Borrower or any other Restricted Subsidiary;
(b) the sale of obsolete assets no longer used or usable in
the business of the Borrower or any of its Subsidiaries;
(c) the sale or discount without recourse of accounts
receivable arising in the ordinary course of business in connection
with the compromise or collection thereof;
(d) sales of assets, other than as otherwise permitted by this
Section 10.6, not exceeding $7,500,000 in any Fiscal Year; provided
that, to the extent the allowance for sale of assets provided for in
this Section 10.6(c) is not utilized, the same may be carried over to
the next Fiscal Year, provided that the allowance shall in no event
exceed $15,000,000 in any Fiscal Year (sales of assets shall be
permitted in excess of the limitation provided for this subsection (c),
provided that the Aggregate Commitment is reduced by the amount of net
proceeds from the sale of such assets;
(e) the sale of real property and other assets owned by and
interests in Co-Investment Entities; and
(f) the sale of assets listed on Schedule 10.6.
Each Lender hereby authorizes and instructs the Administrative Agent to release
any collateral security and guarantee obligations provided by any Subsidiary of
the Borrower upon the sale, transfer or other disposition of such Subsidiary in
accordance with the provisions of this Section 10.6.
SECTION 10.7 Limitations on Dividends and Changes in Capital Structure.
Declare or pay any dividends upon any of its capital stock or other ownership
interests; purchase, redeem, retire or otherwise acquire, directly or
indirectly, any shares of its capital stock or other ownership interests, or
make any distribution of cash, property or assets among the holders of shares of
its capital stock or other ownership interests, or make any change in its
capital structure or amend any organizational document which change or amendment
could reasonably be expected to have a Material Adverse Effect; provided that:
(a) the Borrower or any Restricted Subsidiary may pay
dividends in shares of its own capital stock or other ownership
interest;
(b) any Restricted Subsidiary may pay cash or other dividends
to the Borrower and its other owners, if any;
(c) during such time as no Default or Event of Default shall
have occurred and be continuing or would result therefrom, the Borrower
may, during any fiscal quarter, pay cash dividends on its common stock
to the holders thereof or purchase, redeem or otherwise acquire (by way
of open market purchases, tender offers and/or put
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agreements) shares of the capital stock of the Borrower in an
aggregate amount not to exceed twenty-five percent (25%) of Net Income
for the immediately preceding fiscal quarter; provided that any
amounts available for dividends or the purchase or redemption of stock
in any quarter which are not so dividended or used to purchase or
redeem stock during such quarter may be carried over to subsequent
quarters; and
(d) during such time as no Default or Event of Default shall
have occurred and be continuing or would result therefrom, the Borrower
may purchase, redeem or otherwise acquire (by way of open market
purchases, tender offers and/or put agreements) shares of the capital
stock of the Borrower; provided, that the aggregate amount spent by
the Borrower on account of such purchases, redemptions and other
acquisitions shall not exceed an amount equal to the sum of (i)
$10,000,000 plus (ii) twenty-five percent (25%) of the of the Net Cash
Proceeds of any equity issuance by the Borrower subsequent to the
Closing Date (other than the issuance of capital stock pursuant to the
Borrower's executive stock purchase program) plus (iii) fifty percent
(50%) of the amount realized by the Borrower from the exercise
subsequent to the Closing Date by third Persons of stock options
granted by the Borrower.
SECTION 10.8 Transactions with Affiliates. Except (i) as set forth on
Schedule 10.8, (ii) with respect to service agreements with Controlled
Co-Investment Entities and (iii) as otherwise expressly permitted hereunder,
directly or indirectly: (a) make any loan or advance to, or purchase or assume
any note or other obligation to or from, any of its officers, directors,
shareholders or other Affiliates, or to or from any member of the immediate
family of any of its officers, directors, shareholders or other Affiliates, or
subcontract any operations to any of its Affiliates, or (b) enter into, or be a
party to, any transaction with any of its Affiliates, in both cases except upon
fair and reasonable terms no less favorable to it than it would obtain in a
comparable arm's length transaction with a Person not its Affiliate.
SECTION 10.9 Certain Accounting Changes. Change its Fiscal Year end, or
make any change in its accounting treatment and reporting practices except as
permitted by GAAP.
SECTION 10.10 Amendments; Payments and Prepayments of Subordinated
Debt. Amend or modify (or permit the modification or amendment of) any of the
terms or provisions of any Subordinated Debt in any manner which would
reasonably be expected to have an adverse effect upon the rights or interests of
the Administrative Agent or the Lenders, or make any voluntary or optional
payment or prepayment on, or redeem or acquire for value (including without
limitation by way of depositing with any trustee with respect thereto money or
securities before due for the purpose of paying when due) any Subordinated Debt.
SECTION 10.11 Real Estate Development. Engage in any real estate
development activities for its own account.
SECTION 10.12 Lines of Business. Change the lines of business in which
it currently is engaged or change, directly or indirectly, or substantially
alter its method of doing business in a manner which would have a Material
Adverse Effect.
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SECTION 10.13 Restrictive Agreements. Enter into any Debt which (a)
contains any negative pledge on assets or any other covenants more restrictive
(taken as a whole) than the provisions of Articles VIII, IX and X hereof, or (b)
restricts, limits or otherwise encumbers its ability to incur Liens on or with
respect to any of its assets or properties other than the assets or properties
securing such Debt or (c) restricts, limits or otherwise encumbers the ability
of any Restricted Subsidiary to pay dividends or distributions to the Borrower.
ARTICLE XI
DEFAULT AND REMEDIES
SECTION 11.1 Events of Default. Each of the following shall constitute
an Event of Default, whatever the reason for such event and whether it shall be
voluntary or involuntary or be effected by operation of law or pursuant to any
judgment or order of any court or any order, rule or regulation of any
Governmental Authority or otherwise:
(a) Default in Payment of Principal of Loans. The Borrower
shall default in any payment of principal of any Loan, Note or
Reimbursement Obligation when and as due (whether at maturity, by
reason of acceleration or otherwise).
(b) Other Payment Default. The Borrower shall default in the
payment when and as due (whether at maturity, by reason of acceleration
or otherwise) of interest on any Loan, Note or Reimbursement Obligation
or the payment of any other Obligation and such payment shall not have
been made within five (5) Business Days after such payment becomes due.
(c) Misrepresentation. Any representation or warranty made or
deemed to be made by the Borrower or any of its Subsidiaries under this
Agreement, any other Loan Document or any amendment hereto or thereto,
shall at any time prove to have been incorrect or misleading in any
material respect when made or deemed made.
(d) Default in Performance of Certain Covenants. The Borrower
shall default in the performance or observance of any covenant or
agreement contained in Sections 7.4(d) or (e)(i) or Articles IX or X of
this Agreement.
(e) Default in Performance of Other Covenants and Conditions.
The Borrower or any Subsidiary thereof shall default in the performance
or observance of any term, covenant, condition or agreement contained
in this Agreement (other than as specifically provided for otherwise in
this Section 11.1) or any other Loan Document and such default shall
continue for a period of thirty (30) days after written notice thereof
has been given to the Borrower by the Administrative Agent except that
no such notice shall be required with respect to any default in the
performance or observance of any covenant or agreement contained in
Section 8.12.
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(f) Hedging Agreement. Any termination payment shall be due by
the Borrower under any Hedging Agreement and such amount is not paid
within ten (10) Business Days of the due date thereof.
(g) Debt Cross-Default. (i) There shall occur any acceleration
of the maturity of an aggregate principal amount outstanding of any
Debt for Money Borrowed (other than the Notes) of the Borrower or any
Restricted Subsidiary in excess of $5,000,000 (other than any such
acceleration resulting from the sale of an asset to the extent that
such Debt for Money Borrowed was incurred to finance the acquisition of
such asset, by its terms is due and payable on the sale of such asset
and is paid in full when due), or (ii) any other event shall occur or
condition shall exist under any agreement, mortgage, indenture or
instrument relating to any Debt for Money Borrowed of the Borrower or
any Restricted Subsidiary in excess of $5,000,000 and shall continue
after the applicable grace or cure period, if any, specified in such
agreement, mortgage, indenture or instrument, if the effect of any such
event or condition is to accelerate, or to permit the acceleration of,
the maturity of such Debt for Money Borrowed (other than any such
acceleration resulting from the sale of an asset to the extent that
such Debt for Money Borrowed was incurred to finance the acquisition of
such asset, by its terms is due and payable on the sale of such asset
and is paid in full when due), or (iii) the Borrower or any Restricted
Subsidiary shall default in the payment of any Debt for Money Borrowed
at final maturity.
(h) Other Cross-Defaults. The Borrower or any of its
Restricted Subsidiaries shall default in the payment when due, or in
the performance or observance, of any material obligation or condition
of any Material Contract (other than Debt for Money Borrowed) involving
monetary liability in an amount in excess of $1,000,000 unless, but
only as long as, the existence of any such default is being contested
by the Borrower or such Restricted Subsidiary in good faith by
appropriate proceedings and adequate reserves in respect thereof have
been established on the books of the Borrower or such Subsidiary to the
extent required by GAAP.
(i) Change in Ownership and Control. Any person or group of
persons (within the meaning of Section 13(d) of the Securities Exchange
Act of 1934, as amended) other than Xxxxxx X. Xxxxxx (and any trusts of
which he and/or any of his children are beneficiaries and any other
Persons of which he or any of his children is the beneficial
equityholder), Metropolitan Acquisition Partners IV, L.P. and
Metropolitan Acquisition Partners V, L.P. and their respective
Affiliates, shall obtain ownership or control in one or more series of
transactions of more than twenty-five percent (25%) of the common stock
and twenty-five percent (25%) of the voting power of the Borrower
entitled to vote in the election of members of the board of directors
of the Borrower and Xxxxxx X. Xxxxxx (and any trusts of which he and/or
any of his children are beneficiaries and any other Persons of which he
or any of his children is the beneficial equityholder), Metropolitan
Acquisition Partners IV, L.P. and Metropolitan Acquisition Partners V,
L.P. and their respective Affiliates cease to own 51% or more of the
common stock of the Borrower.
(j) Voluntary Bankruptcy Proceeding. The Borrower or any
Restricted Subsidiary shall (i) commence a voluntary case under the
federal bankruptcy laws (as now or hereafter in effect), (ii) file a
petition seeking to take advantage of any other laws,
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domestic or foreign, relating to bankruptcy, insolvency,
reorganization, winding up or composition for adjustment of debts,
(iii) consent to or fail to contest in a timely and appropriate manner
any petition filed against it in an involuntary case under such
bankruptcy laws or other laws, (iv) apply for or consent to, or fail to
contest in a timely and appropriate manner, the appointment of, or the
taking of possession by, a receiver, custodian, trustee, or liquidator
of itself or of a substantial part of its property, domestic or
foreign, (v) admit in writing its inability to pay its debts as they
become due, (vi) make a general assignment for the benefit of
creditors, or (vii) take any corporate action for the purpose of
authorizing any of the foregoing.
(k) Involuntary Bankruptcy Proceeding. A case or other
proceeding shall be commenced against the Borrower or any Restricted
Subsidiary thereof in any court of competent jurisdiction seeking (i)
relief under the federal bankruptcy laws (as now or hereafter in
effect) or under any other laws, domestic or foreign, relating to
bankruptcy, insolvency, reorganization, winding up or adjustment of
debts, or (ii) the appointment of a trustee, receiver, custodian,
liquidator or the like for the Borrower or any Restricted Subsidiary
thereof or for all or any substantial part of their respective assets,
domestic or foreign, and such case or proceeding shall continue
undismissed or unstayed for a period of ninety (90) consecutive days,
or an order granting the relief requested in such case or proceeding
(including, but not limited to, an order for relief under such federal
bankruptcy laws) shall be entered.
(l) Failure of Agreements. Any material provision of this
Agreement or of any other Loan Document shall for any reason cease to
be valid and binding on the Borrower or Restricted Subsidiary party
thereto or any such Person shall so state in writing, or this Agreement
or the Pledge and Security Agreement shall for any reason cease to
create a valid and perfected first priority Lien on, or security
interest in, any of the collateral purported to be covered thereby, in
each case other than in accordance with the express terms hereof or
thereof and except where due solely to the failure to file, on a timely
basis, appropriate continuation statements under the Uniform Commercial
Code.
(m) Termination Event. The occurrence of any of the following
events: (i) the Borrower or any ERISA Affiliate fails to make full
payment when due of all amounts which, under the provisions of any
Pension Plan or Section 412 of the Code, the Borrower or any ERISA
Affiliate is required to pay as contributions thereto which results in
a Material Adverse Effect, (ii) an accumulated funding deficiency in
excess of $250,000 occurs or exists, whether or not waived, with
respect to any Pension Plan, (iii) a Termination Event or (iv) the
Borrower or any ERISA Affiliate as employers under one or more
Multiemployer Plan makes a complete or partial withdrawal from any such
Multiemployer Plan and the plan sponsor of such Multiemployer Plans
notifies such withdrawing employer that such employer has incurred a
withdrawal liability requiring payments in an amount which in the
aggregate with all other withdrawal liabilities then due and payable
exceeds $5,000,000.
(n) Judgment. A judgment or order for the payment of money not
covered by insurance which causes the aggregate amount of such
undischarged, unstayed and not removed judgments to exceed $5,000,000
in any Fiscal Year shall be entered against the
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Borrower or any of its Restricted Subsidiaries by any court and such
judgment or order shall continue undischarged, unstayed or not removed
to bond for a period of thirty (30) days.
SECTION 11.2 Remedies. Upon the occurrence of an Event of Default, with
the consent of the Required Lenders, the Administrative Agent may, or upon the
request of the Required Lenders, the Administrative Agent shall, by notice to
the Borrower:
(a) Acceleration; Termination of Facilities. Declare the
principal of and interest on the Loans, the Notes and Reimbursement
Obligations at the time outstanding, and all other amounts owed to the
Lenders and Agents under this Agreement or any of the other Loan
Documents (including, without limitation, all L/C Obligations, whether
or not the beneficiaries of the then outstanding Letters of Credit
shall have presented the documents required thereunder) and all other
Obligations, to be forthwith due and payable, whereupon the same shall
immediately become due and payable without presentment, demand, protest
or other notice of any kind, all of which are expressly waived,
anything in this Agreement or the other Loan Documents to the contrary
notwithstanding, and terminate the Credit Facility and any right of the
Borrower to request borrowings thereunder and any right of the Borrower
to request borrowings or Letters of Credit thereunder; provided, that
upon the occurrence of an Event of Default specified in Section 11.1(j)
or (k), the Credit Facility shall be automatically terminated and all
Obligations shall automatically become due and payable without
presentment, demand, protest or other notice of any kind, all of which
are expressly waived, anything in this Agreement or the other Loan
Documents to the contrary notwithstanding.
(b) Letters of Credit. With respect to all Letters of Credit
for which presentment for honor shall not have occurred at the time of
an acceleration pursuant to the preceding paragraph, require the
Borrower at such time to deposit in a cash collateral account opened by
the Administrative Agent an amount equal to the aggregate then undrawn
and unexpired amount of such Letters of Credit. Amounts held in such
cash collateral account shall be applied by the Administrative Agent to
the payment of drafts drawn under such Letters of Credit, and the
unused portion thereof after all such Letters of Credit shall have
expired or been fully drawn upon, if any, shall be applied to repay the
other Obligations. After all such Letters of Credit shall have expired
or been fully drawn upon, the Reimbursement Obligation shall have been
satisfied and all other Obligations shall have been paid in full, the
balance, if any, in such cash collateral account shall be returned to
the Borrower.
(c) Rights of Collection. Exercise on behalf of the Lenders
all of its other rights and remedies under this Agreement, the other
Loan Documents and Applicable Law, in order to satisfy all of the
Borrower's Obligations.
SECTION 11.3 Rights and Remedies Cumulative; Non-Waiver; etc. The
enumeration of the rights and remedies of the Agents and the Lenders set forth
in this Agreement is not intended to be exhaustive and the exercise by the
Agents and Lenders of any right or remedy shall not preclude the exercise of any
other rights or remedies, all of which shall be cumulative, and shall be in
addition to any other right or remedy given hereunder or under the other Loan
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Documents or that may now or hereafter exist at law or in equity or by suit or
otherwise. No delay or failure to take action on the part of any Agent or Lender
in exercising any right, power or privilege shall operate as a waiver thereof,
nor shall any single or partial exercise of any such right, power or privilege
preclude any other or further exercise thereof or the exercise of any other
right, power or privilege or shall be construed to be a waiver of any Event of
Default. No course of dealing between the Borrower, the Agents and Lenders or
their respective agents or employees shall be effective to change, modify or
discharge any provision of this Agreement or any of the other Loan Documents or
to constitute a waiver of any Event of Default.
SECTION 11.4 Judgment Currency. The obligation of the Borrower to make
payments of the principal of and interest on the Notes and the obligation of any
such Person to make payments of any other amounts payable hereunder or pursuant
to any other Loan Document in the currency specified for such payment shall not
be discharged or satisfied by any tender, or any recovery pursuant to any
judgment, which is expressed in or converted into any other currency, except to
the extent that such tender or recovery shall result in the actual receipt by
each of the Administrative Agent and Lenders of the full amount of the
particular Permitted Currency expressed to be payable pursuant to the applicable
Loan Document. The Administrative Agent shall, using all amounts obtained or
received from the Borrower pursuant to any such tender or recovery in payment of
principal of and interest on the Obligations, promptly purchase the applicable
Permitted Currency at the most favorable spot exchange rate determined by the
Administrative Agent to be available to it. The obligation of the Borrower to
make payments in the applicable Permitted Currency shall be enforceable as an
alternative or additional cause of action solely for the purpose of recovering
in the applicable Permitted Currency the amount, if any, by which such actual
receipt shall fall short of the full amount of the Permitted Currency expressed
to be payable pursuant to the applicable Loan Document. The obligations of the
Borrower under this Section 11.4 shall survive the payment in full of the
Obligations and the termination of the Commitments.
ARTICLE XII
THE AGENTS
SECTION 12.1 Appointment and Authorization. Each of the Lenders hereby
irrevocably designates and appoints First Union as Administrative Agent of such
Lender and Xxxxxx as Syndication Agent of such Lender under this Agreement and
the other Loan Documents and each Lender irrevocably authorizes First Union as
Administrative Agent for such Lender, and Xxxxxx as Syndication Agent for such
Lender, to take such action on its behalf under the provisions of this Agreement
and the other Loan Documents and to exercise such powers and perform such duties
as are expressly delegated to such Agent by the terms of this Agreement and such
other Loan Documents, together with such other powers as are reasonably
incidental thereto. Notwithstanding any provision to the contrary elsewhere in
this Agreement or such other Loan Documents, no Agent shall have any duties or
responsibilities, except those expressly set forth herein and therein, or any
fiduciary relationship with any Lender, and no implied covenants, functions,
responsibilities, duties, obligations or liabilities shall be read into this
Agreement or the other Loan Documents or otherwise exist against any Agent. The
Administrative Agent shall administer the Credit Facility in the same manner as
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the Administrative Agent administers similar loans for its own portfolio.
SECTION 12.2 Delegation of Duties. Each Agent may execute any of its
respective duties under this Agreement and the other Loan Documents by or
through agents or attorneys-in-fact and shall be entitled to advice of counsel
concerning all matters pertaining to such duties. No Agent shall be responsible
for the negligence or misconduct of any agents or attorneys-in-fact selected by
such Agent with reasonable care.
SECTION 12.3 Exculpatory Provisions. Neither any Agent nor any of its
officers, directors, employees, agents, attorneys-in-fact, Subsidiaries or
Affiliates shall be (a) liable for any action lawfully taken or omitted to be
taken by it or such Person under or in connection with this Agreement or the
other Loan Documents (except for actions occasioned by its or such Person's own
gross negligence or willful misconduct), or (b) responsible in any manner to any
of the Lenders for any recitals, statements, representations or warranties made
by the Borrower or any of its Subsidiaries or any officer thereof contained in
this Agreement or the other Loan Documents or in any certificate, report,
statement or other document referred to or provided for in, or received by such
Agent under or in connection with, this Agreement or the other Loan Documents or
for the value, validity, effectiveness, genuineness, enforceability or
sufficiency of this Agreement or the other Loan Documents or for any failure of
the Borrower or any of its Subsidiaries to perform its obligations hereunder or
thereunder. No Agent shall be under any obligation to any Lender to ascertain or
to inquire as to the observance or performance of any of the agreements
contained in, or conditions of, this Agreement, or to inspect the properties,
books or records of the Borrower or any of its Subsidiaries.
SECTION 12.4 Reliance by the Agents. Each Agent shall be entitled to
rely, and shall be fully protected in relying, upon any note, writing,
resolution, notice, consent, certificate, affidavit, letter, cablegram,
telegram, telecopy, telex or teletype message, statement, order or other
document or conversation believed by it to be genuine and correct and to have
been signed, sent or made by the proper Person or Persons and upon advice and
statements of legal counsel (including, without limitation, counsel to the
Borrower), independent accountants and other experts selected by such Agent.
Each Agent may deem and treat the payee of any Note as the owner thereof for all
purposes unless such Note shall have been transferred in accordance with Section
13.8 hereof. Each Agent shall be fully justified in failing or refusing to take
any action under this Agreement and the other Loan Documents unless it shall
first receive such advice or concurrence of the Required Lenders (or, when
expressly required hereby or by the relevant other Loan Document, all the
Lenders) as it deems appropriate or it shall first be indemnified to its
satisfaction by the Lenders against any and all liability and expense which may
be incurred by it by reason of taking or continuing to take any such action
except for its own gross negligence or willful misconduct. Each Agent shall in
all cases be fully protected in acting, or in refraining from acting, under this
Agreement and the Notes in accordance with a request of the Required Lenders
(or, when expressly required hereby, all the Lenders), and such request and any
action taken or failure to act pursuant thereto shall be binding upon all the
Lenders and all future holders of the Notes.
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SECTION 12.5 Notice of Default. No Agent shall be deemed to have
knowledge or notice of the occurrence of any Default or Event of Default
hereunder unless it has received notice from a Lender or the Borrower referring
to this Agreement, describing such Default or Event of Default and stating that
such notice is a "notice of default". In the event that an Agent receives such a
notice, it shall promptly give notice thereof to the other Agent and Lenders.
Each Agent shall take such action with respect to such Default or Event of
Default as shall be reasonably directed by the Required Lenders (or, when
expressly required hereby, all the Lenders); provided that unless and until such
Agent shall have received such directions, such Agent may (but shall not be
obligated to) take such action, or refrain from taking such action, with respect
to such Default or Event of Default as it shall deem advisable in the best
interests of the Lenders.
SECTION 12.6 Non-Reliance on the Agents and Other Lenders. Each Lender
expressly acknowledges that neither any Agent nor any of its respective
officers, directors, employees, agents, attorneys-in-fact, subsidiaries or
affiliates has made any representations or warranties to it and that no act by
any Agent hereafter taken, including any review of the affairs of the Borrower
or any of its Subsidiaries, shall be deemed to constitute any representation or
warranty by such Agent to any Lender. Each Lender represents to the Agents that
it has, independently and without reliance upon any Agent or any other Lender,
and based on such documents and information as it has deemed appropriate, made
its own appraisal of and investigation into the business, operations, property,
financial and other condition and creditworthiness of the Borrower and its
Subsidiaries and made its own decision to make its Loans and enter into this
Agreement. Each Lender also represents that it will, independently and without
reliance upon any Agent or any other Lender, and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit analysis, appraisals and decisions in taking or not taking action under
this Agreement and the other Loan Documents, and to make such investigation as
it deems necessary to inform itself as to the business, operations, property,
financial and other condition and creditworthiness of the Borrower and its
Subsidiaries. Except for notices, reports and other documents expressly required
to be furnished to the Lenders by an Agent hereunder or by the other Loan
Documents, such Agent shall not have any duty or responsibility to provide any
Lender with any credit or other information concerning the business, operations,
property, financial and other condition or creditworthiness of the Borrower or
any of its Subsidiaries which may come into the possession of such Agent or any
of its respective officers, directors, employees, agents, attorneys-in-fact,
Subsidiaries or Affiliates.
SECTION 12.7 Indemnification. The Lenders agree to indemnify each Agent
in its capacity as such and (to the extent not reimbursed by the Borrower and
without limiting the obligation of the Borrower to do so), ratably according to
the respective amounts of their Commitment Percentages, from and against any and
all liabilities, obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses or disbursements of any kind whatsoever which may at any
time (including, without limitation, at any time following the payment of the
Notes) be imposed on, incurred by or asserted against such Agent in any way
relating to or arising out of this Agreement or the other Loan Documents, or any
documents contemplated by or referred to herein or therein or the transactions
contemplated hereby or thereby or any action taken or omitted by such Agent
under or in connection with any of the foregoing; provided that no Lender shall
be liable for the payment of any portion of such liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses or
disbursements resulting from
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such Agent's gross negligence or willful misconduct. The agreements in this
Section 12.7 shall survive the payment of the Notes and all other amounts
payable hereunder and the termination of this Agreement.
SECTION 12.8 Agent in Its Individual Capacity. Each Agent and its
respective subsidiaries and affiliates may make loans to, accept deposits from
and generally engage in any kind of business with the Borrower as though it were
not an Agent hereunder. With respect to any Loans made or renewed by it and any
Note issued to it, each Agent shall have the same rights and powers under this
Agreement and the other Loan Documents as any Lender and may exercise the same
as though it were not an Agent, and the terms "Lender" and "Lenders" shall
include the Administrative Agent in its individual capacity.
SECTION 12.9 Resignation of the Administrative Agent; Successor
Administrative Agent. Subject to the appointment and acceptance of a successor
as provided below, the Administrative Agent may resign at any time by giving
notice thereof to the Lenders and the Borrower. Upon any such resignation, the
Required Lenders with, as long as no Event of Default has occurred and is
continuing, the consent of the Borrower, which consent shall not be unreasonably
withheld, shall have the right to appoint a successor Administrative Agent,
which successor shall have minimum capital and surplus of at least
$1,000,000,000. If no successor Administrative Agent shall have been so
appointed by the Required Lenders and shall have accepted such appointment
within thirty (30) days after the Administrative Agent's giving of notice of
resignation, then the Administrative Agent may, on behalf of the Lenders,
appoint a successor Administrative Agent, which successor shall be either (a)
any Lender or (b) with the consent of the Borrower (not to be unreasonably
withheld), so long as no Event of Default has occurred and is continuing, a
commercial bank organized or licensed under the laws of the United States or any
political subdivision thereof which has minimum capital and surplus of at least
$1,000,000,000. Upon the acceptance of any appointment as Administrative Agent
hereunder by a successor Administrative Agent, such successor Administrative
Agent shall thereupon succeed to and become vested with all rights, powers,
privileges and duties of the retiring Administrative Agent, and the retiring
Administrative Agent shall be discharged from its duties and obligations
hereunder. After any retiring Administrative Agent's resignation hereunder as
Administrative Agent, the provisions of this Section 12.9 shall continue in
effect for its benefit in respect of any actions taken or omitted to be taken by
it while it was acting as Administrative Agent.
ARTICLE XIII
MISCELLANEOUS
SECTION 13.1 Notices.
(a) Method of Communication. Except as otherwise provided in this
Agreement, all notices and communications hereunder shall be in writing, or by
telephone subsequently confirmed in writing. Any notice shall be effective if
delivered by hand delivery or sent via telecopy, recognized overnight courier
service or certified mail, return receipt requested, and shall be presumed to be
received by a party hereto (i) on the date of delivery if delivered by hand or
sent by telecopy, (ii) on the next Business Day if sent by recognized overnight
courier service and (iii)
68
on the third Business Day following the date sent by certified mail, return
receipt requested.
(b) Addresses for Notices. Notices to any party shall be sent to it at
the following addresses, or any other address as to which all the other parties
are notified in writing.
If to the Borrower: Insignia/ESG Holdings, Inc.
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxx Xxxxxx
Telecopy Number: (000) 000-0000
With a copy to: Insignia/ESG Holdings, Inc.
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxx X. Xxxxxxx, Esq.
Telecopy Number: (000) 000-0000
Insignia/ESG Holdings, Inc.
Xxxxx 000
00 Xxxxx Xxxx Xxxxxx
Xxxxxxxxxx, Xxxxx Xxxxxxxx 00000
Attention: Xxxxx X. Aston
Telecopy Number: (000) 000-0000
With a copy (in the case of
extraordinary notices only) to
(which shall not constitute
notice hereunder): Xxxxxxx Xxxxxxx & Xxxxxxxx
000 Xxxxxxxxx Xxxxxx - 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Attention: Xxxxxxx X. X. Xxxxxx
Telecopy Number: (000) 000-0000
If to First Union as First Union National Bank
Administrative Agent One Insignia Financial Xxxxx
X.X. Xxx 0000
Xxxxxxxxxx, Xxxxx Xxxxxxxx 00000
Attention: Portfolio Management and
Relationship Manager
Telecopy Number: (000) 000-0000
With a copy to: First Union National Bank
One First Union Center
000 X. Xxxxxxx Xxxxxx, XX-00
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000-0000
Attention: Syndication Agency Services
Telecopy Number: (000) 000-0000
69
With a copy to (which shall
not constitute notice
hereunder): Xxxxxxx Xxxxxxxxx Xxxxxxx & Xxxxxxx, L.L.P.
Suite 4200
000 Xxxxx Xxxxx Xxxxxx
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000-0000
Attention: J. Xxxxxxx Xxxxxxxx, Esquire
Telecopy Number: (000) 000-0000
If to the
Syndication Agent: Xxxxxx Commercial Paper Inc.
Three World Financial Xxxxxx
00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxxx Xxxxxxx
Telecopy Number: (000) 000-0000
If to any Lender: To the Address set forth on Schedule 1.1(a)
(c) Administrative Agent's Office. The Administrative Agent hereby
designates its office located at the address set forth above, or any subsequent
office which shall have been specified for such purpose by written notice to the
Borrower and Lenders, as the Administrative Agent's Office referred to herein,
to which payments due are to be made and at which Loans will be disbursed and
Letters of Credit issued.
SECTION 13.2 Expenses; Indemnity. The Borrower will (a) pay all
out-of-pocket expenses of the Agents in connection with: (i) the preparation,
execution and delivery of this Agreement and each other Loan Document, whenever
the same shall be executed and delivered, including without limitation all
reasonable out-of-pocket syndication and due diligence expenses and reasonable
fees and disbursements of a single counsel for the Agents (with the right of
such counsel to engage such special or local counsel as the Agents reasonably
deem necessary), (ii) the preparation, execution and delivery of any waiver,
amendment or consent by the Agents or the Lenders relating to this Agreement or
any other Loan Document, including without limitation reasonable fees and
disbursements of a single counsel for the Agents and (iii) the administration
and enforcement of any rights and remedies of the Agents and Lenders under the
Credit Facility, including, with respect to the Administrative Agent only,
consulting with appraisers, accountants, engineers and attorneys employed by the
Administrative Agent concerning the nature, scope or value of any right or
remedy of any Agent or Lender hereunder or under any other Loan Document or any
factual matters in connection therewith, which expenses shall include without
limitation the reasonable fees and disbursements of such Persons, and (b)
defend, indemnify and hold harmless the Agents and Lenders, and their respective
parents, Subsidiaries, Affiliates, employees, agents, officers and directors
(collectively, the "indemnitees"), from and against any losses, penalties,
fines, liabilities, settlements, damages, costs and expenses, suffered by any
such indemnitee in connection with any claim, investigation, litigation or other
proceeding (whether or not any Agent or Lender is a party thereto) and the
prosecution and defense thereof, arising out of this
70
Agreement, any other Loan Document or the Loans, including without limitation
reasonable attorney's and consultant's fees, except to the extent that any of
the foregoing result from the gross negligence or willful misconduct of the
party seeking indemnification therefor or the breach by the Agents or the
Lenders of this Agreement. If any claim, demand, action or cause of action is
asserted against any indemnitee, such indemnitee shall promptly notify the
Borrower, but the failure to so promptly notify the Borrower shall not affect
the Borrower's obligations under this Section 13.2 unless such failure
materially prejudices the Borrower's right to participate in the contest of such
claim, demand, action or cause of action, as hereinafter provided. If requested
by the Borrower in writing, and so long as no Default or Event of Default shall
have occurred and be continuing, such indemnitee shall in good faith contest the
validity, applicability and amount of such claim, demand, action or cause of
action and shall permit the Borrower to participate in such contest. Any
indemnitee that proposes to settle or compromise any claim or proceeding for
which the Borrower may be liable for payment of indemnity hereunder shall give
the Borrower written notice of the terms of such proposed settlement or
compromise reasonably in advance of settling or compromising such claim or
proceeding and shall obtain the Borrower's concurrence thereto. The Agents are
authorized at the Borrower's cost and expense to employ one counsel in enforcing
the rights of the Agents and Lenders hereunder and in defending against any
claim, demand, action or cause of action covered by this Section 13.2. In
addition, each indemnitee shall have the right to employ its own separate
counsel in any such case, but the fees and expenses of such counsel shall be at
the expense of such indemnitee unless the employment of such counsel shall have
been authorized in writing by the Borrower in connection with the defense of
such action, in which case such fees and expenses shall be paid by the Borrower.
If an indemnitee shall have reasonably concluded (based upon the written advice
of counsel to the Administrative Agent) that the representation by one counsel
of the Agents and Lenders creates a conflict of interest for such counsel, the
reasonable fees and expenses of such additional counsel as are necessary to
resolve that conflict chosen by such indemnitee and reasonably satisfactory to
the Borrower (provided that the Borrower's approval of such counsel shall not be
unreasonably delayed or withheld) shall be borne by the Borrower. Any obligation
or liability of the Borrower to any indemnitee under this Section 13.2 shall
survive the expiration or termination of this Agreement and the repayment of the
Obligations.
SECTION 13.3 GOVERNING LAW. THIS AGREEMENT, THE NOTES AND THE OTHER
LOAN DOCUMENTS, UNLESS OTHERWISE EXPRESSLY SET FORTH THEREIN, SHALL BE GOVERNED
BY, AND CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW
YORK, WITHOUT REFERENCE TO THE CONFLICTS OR CHOICE OF LAW PRINCIPLES THEREOF.
SECTION 13.4 CONSENT TO JURISDICTION. THE BORROWER HEREBY IRREVOCABLY
CONSENTS TO THE PERSONAL JURISDICTION OF THE STATE AND FEDERAL COURTS SITTING IN
NEW YORK COUNTY, NEW YORK, IN ANY ACTION, CLAIM OR OTHER PROCEEDING ARISING OUT
OF ANY DISPUTE IN CONNECTION WITH THIS AGREEMENT, THE NOTES AND THE OTHER LOAN
DOCUMENTS, ANY RIGHTS OR OBLIGATIONS HEREUNDER OR THEREUNDER, OR THE PERFORMANCE
OF SUCH RIGHTS AND OBLIGATIONS. THE BORROWER HEREBY IRREVOCABLY CONSENTS TO THE
SERVICE OF A SUMMONS AND COMPLAINT AND OTHER PROCESS IN ANY ACTION, CLAIM OR
PROCEEDING BROUGHT BY
71
ANY AGENT OR LENDER IN CONNECTION WITH THIS AGREEMENT, THE NOTES OR THE OTHER
LOAN DOCUMENTS, ANY RIGHTS OR OBLIGATIONS HEREUNDER OR THEREUNDER, OR THE
PERFORMANCE OF SUCH RIGHTS AND OBLIGATIONS, ON BEHALF OF ITSELF OR ITS PROPERTY,
BY REGISTERED OR CERTIFIED MAIL, RETURN RECEIPT REQUESTED, OTHERWISE IN THE
MANNER SPECIFIED IN SECTION 13.1. NOTHING IN THIS SECTION 13.4 SHALL AFFECT THE
RIGHT OF ANY AGENT OR LENDER TO SERVE LEGAL PROCESS IN ANY OTHER MANNER
PERMITTED BY APPLICABLE LAW OR AFFECT THE RIGHT OF ANY AGENT OR LENDER TO BRING
ANY ACTION OR PROCEEDING AGAINST THE BORROWER OR ITS PROPERTIES IN THE COURTS OF
ANY OTHER JURISDICTIONS.
SECTION 13.5 WAIVER OF JURY TRIAL. TO THE EXTENT PERMITTED BY
APPLICABLE LAW, EACH AGENT AND LENDER AND THE BORROWER HEREBY IRREVOCABLY WAIVE
THEIR RESPECTIVE RIGHTS TO A JURY TRIAL WITH RESPECT TO ANY ACTION, CLAIM OR
OTHER PROCEEDING ARISING OUT OF ANY DISPUTE IN CONNECTION WITH THIS AGREEMENT,
THE NOTES OR THE OTHER LOAN DOCUMENTS, ANY RIGHTS OR OBLIGATIONS HEREUNDER OR
THEREUNDER, OR THE PERFORMANCE OF SUCH RIGHTS AND OBLIGATIONS.
SECTION 13.6 Reversal of Payments. To the extent the Borrower makes a
payment or payments to any Agent for the ratable benefit of the Lenders or any
Agent receives any payment or proceeds of the collateral which payments or
proceeds 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, state or federal law,
common law or equitable cause, then, to the extent of such payment or proceeds
repaid, the Obligations or part thereof intended to be satisfied shall be
revived and continued in full force and effect as if such payment or proceeds
had not been received by such Agent.
SECTION 13.7 Accounting Matters. All financial and accounting
calculations, measurements and computations made for any purpose relating to
this Agreement, including, without limitation, all computations utilized by the
Borrower or any Subsidiary thereof to determine compliance with any covenant
contained herein, shall, except as otherwise expressly contemplated hereby or
unless there is an express written direction by the Agents to the contrary
agreed to by the Borrower, be performed in accordance with GAAP. In the event of
changes in GAAP in accordance with the definition thereof, the Borrower and the
Lenders will thereafter negotiate in good faith to revise, by amendment of this
Agreement, any covenants of this Agreement affected thereby in order to make
such covenants consistent with GAAP then in effect. All projections and
estimates of financial results shall be made in good faith and based on
reasonable assumptions.
SECTION 13.8 Successors and Assigns; Participations.
(a) Benefit of Agreement. This Agreement shall be binding upon and
inure to the benefit of the Borrower, the Agents and Lenders, all future holders
of the Notes, and their respective successors and assigns, except that the
Borrower shall not assign or transfer any of its rights or obligations under
this Agreement without the prior written consent of each Lender.
72
(b) Assignment by Lenders. Each Lender may, with the consent of the
Administrative Agent, which consent shall not be unreasonably withheld or
delayed, and, as long as no Event of Default has occurred and is continuing, the
consent of the Borrower, which consent of the Borrower shall not be unreasonably
withheld or delayed, assign to one or more Eligible Assignees all or a portion
of its interests, rights and obligations under this Agreement (including,
without limitation, all or a portion of the Loans at the time owing to it and
the Note held by it); provided that:
(i) each such assignment shall be of a constant, and not a
varying, percentage of all the assigning Lender's rights and
obligations under this Agreement;
(ii) if less than all of the assigning Lender's Commitment is
to be assigned, the Commitment so assigned shall not be less than
$5,000,000 and the assigning Lender shall retain a Commitment of at
least $5,000,000;
(iii) the parties to each such assignment shall execute and
deliver to the Administrative Agent, for its acceptance and recording
in the Register, an Assignment and Acceptance in the form of Exhibit F
(an "Assignment and Acceptance"), together with any Note or Notes
subject to such assignment;
(iv) such assignment shall not, without the consent of the
Borrower, require the Borrower to file a registration statement with
the Securities and Exchange Commission or apply to or qualify the Loans
or the Notes under the blue sky laws of any state; and
(v) the assigning Lender shall pay to the Administrative Agent
an assignment fee of $3,000 upon the execution by such Lender of the
Assignment and Acceptance; provided that no such fee shall be payable
upon any assignment by a Lender to an Affiliate thereof, upon any
assignment requested by the Borrower pursuant to the terms of Section
4.14 or upon any increase in the Aggregate Commitment in accordance
with Section 2.8 which does not involve a new Lender. (Barclays Bank
PLC shall not be considered a new Lender for purposes of Section 2.8.).
Upon such execution, delivery, acceptance and recording, from and after the
effective date specified in each Assignment and Acceptance, (A) the assignee
thereunder shall be a party hereto and, to the extent provided in such
Assignment and Acceptance, have the rights and obligations of a Lender hereby
and (B) the Lender thereunder shall, to the extent provided in such assignment,
be released from its obligations under this Agreement.
(c) Rights and Duties Upon Assignment. By executing and delivering an
Assignment and Acceptance, the assigning Lender thereunder and the assignee
thereunder confirm to and agree with each other and the other parties hereto as
set forth in such Assignment and Acceptance.
(d) Register. The Administrative Agent shall maintain a copy of each
Assignment and Acceptance delivered to it and a register for the recordation of
the names and addresses of the Lenders and the amount of the Loans with respect
to each Lender from time to time (the "Register"). The entries in the Register
shall be conclusive, in the absence of manifest error, and the Borrower, the
Administrative Agent and the Lenders may treat each Person whose name is
73
recorded in the Register as a Lender hereunder for all purposes of this
Agreement. The Register shall be available for inspection by the Borrower or any
Lender at any reasonable time and from time to time upon reasonable prior
notice.
(e) Issuance of New Notes. Upon its receipt of an Assignment and
Acceptance executed by an assigning Lender and an Eligible Assignee together
with the Note subject to such assignment and the written consent to such
assignment, the Administrative Agent shall, if such Assignment and Acceptance
has been completed and is substantially in the form of Exhibit F:
(i) accept such Assignment and Acceptance;
(ii) record the information contained therein in the Register;
(iii) give prompt notice thereof to the Lenders and the
Borrower; and
(iv) promptly deliver a copy of such Assignment and Acceptance
to the Borrower.
Within five (5) Business Days after receipt of notice, the Borrower shall
execute and deliver to the Administrative Agent, in exchange for the surrendered
Note, a new Note to the order of such Eligible Assignee in an amount equal to
the Commitment assumed by it pursuant to such Assignment and Acceptance and a
new Note to the order of the assigning Lender in an amount equal to the
Commitment retained by it hereunder. Such new Note shall be in an aggregate
principal amount equal to the aggregate principal amount of such surrendered
Note, shall be dated the effective date of such Assignment and Acceptance and
shall otherwise be in substantially the form of the assigned Note delivered by
the assigning Lender. Each surrendered Note shall be canceled and returned to
the Borrower.
(f) Participations. Each Lender may sell participations to one or more
banks or other financial institutions which are not competitors of the Borrower
in all or a portion of its rights and obligations under this Agreement
(including, without limitation, all or a portion of its Loans and the Note held
by it); provided that:
(i) such Lender's obligations under this Agreement (including,
without limitation, its Commitment) shall remain unchanged;
(ii) such Lender shall remain solely responsible to the other
parties hereto for the performance of such obligations;
(iii) such Lender shall remain the holder of the Note held by
it for all purposes of this Agreement;
(iv) the Borrower, the Agents 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;
74
(v) such Lender shall not permit such participant the right to
approve any waivers, amendments or other modifications to this
Agreement or any other Loan Document other than waivers, amendments or
modifications which would reduce the principal of or the interest rate
on any Loan or Reimbursement Obligation or extend the term or increase
the amount of the Commitment, reduce the amount of any fees to which
such participant is entitled, extend any scheduled payment date for
principal of any Loan or, except as expressly contemplated hereby or
thereby, release all or substantially all of the collateral securing
the Obligations; and
(vi) any such disposition shall not, without the consent of
the Borrower, require the Borrower to file a registration statement
with the Securities and Exchange Commission to apply to qualify the
Loans or the Notes under the blue sky law of any state.
(g) Disclosure of Information; Confidentiality. Each Agent and each
Lender agree to hold any confidential information which it may receive from the
Borrower pursuant to this Agreement in confidence, except for disclosure (i) to
legal counsel, accountants, and other professional advisors, on a need-to-know
basis, (ii) to regulatory officials, (iii) as required by law or legal process
(including by subpoena) or in connection with any legal proceeding, (iv) to
another financial institution in connection with a disposition or proposed
disposition of any of its interests hereunder or under any other Loan Document,
upon execution by such institution of an agreement to keep such information
confidential to the extent described in this Section 13.8(g), (v) in court
filings (which such Lender will use its reasonable efforts to seek to have
sealed by the court) in connection with (and to the extent related to)
litigation to which a Lender or an Agent is a party, (vi) of information which
subsequently becomes public or is disclosed by a Person not known by a Lender or
an Agent to be bound by a duty of confidentiality or (vii) to any Affiliate of
such Lender. The Agents and Lenders agree that the breach of this Section
13.8(g), including the disclosure of any confidential information received from
the Borrower pursuant to this Agreement, shall constitute a material breach of
this Agreement. Notwithstanding (iii) above, in the event that any such Person
is requested pursuant to, or required by, Applicable Law or Governmental
Authority to disclose any such information, such Person will provide the
Borrower with prompt notice of such request or requirement, unless prohibited by
law or regulation, in order to enable the Borrower to seek an appropriate
protective order or other remedy, or to consult with such Person with respect to
the Borrower's taking steps to resist or narrow the scope of such request or
legal process. If, in such event, the Borrower has not provided such Person with
a protective order or other remedy in sufficient time, with such Person acting
in good faith and otherwise in its sole discretion, for such Person to avoid
unlawful nondisclosure of such information, such Person may disclose such
information pursuant to such Applicable Law or Governmental Authority, as the
case may be, without any recourse or remedy against such Person by the Borrower
or any Affiliate of the Borrower, which the Borrower hereby expressly waives.
(h) Certain Pledges or Assignments. Nothing herein shall prohibit any
Lender from pledging or assigning any Note to any Federal Reserve Bank in
accordance with Applicable Law.
SECTION 13.9 Amendments, Waivers and Consents. Except as set forth
below and as otherwise provided in Section 2.8, any term, covenant, agreement or
condition of this Agreement or any of the other Loan Documents may be amended or
waived by the Lenders, and any consent given by the Lenders, if, but only if,
such amendment, waiver or consent is in
75
writing signed by the Required Lenders (other than Defaulting Lenders) (or by
the Administrative Agent with the consent of the Required Lenders) and delivered
to the Administrative Agent and, in the case of an amendment, signed by the
Borrower; provided, that no amendment, waiver or consent shall (a) except as
specifically set forth in Section 2.8, increase the amount or extend the time of
the obligation of the Lenders to make Loans or issue or participate in Letters
of Credit (including without limitation pursuant to Section 2.6), (b) extend the
originally scheduled time or times of payment of the principal of any Loan or
Reimbursement Obligation or the time or times of payment of interest on any Loan
or Reimbursement Obligation or any fee, (c) reduce the rate of interest or fees
payable on any Loan or Reimbursement Obligation or reduce the principal amount
of any Loan or Reimbursement Obligation, (d) permit any subordination of the
principal or interest on any Loan or Reimbursement Obligation, (e) release any
substantial portion of the collateral or any material guarantee obligation
(other than as specifically permitted in this Agreement) or (f) amend the
provisions of this Section 13.9, the definition of Required Lenders or any
provision of any Loan Document which, by its terms, requires the consent,
approval or satisfaction of all Lenders or each Lender, without the prior
written consent of each Lender. In addition, no amendment, waiver or consent to
the provisions of Article XII shall be made without the written consent of the
Agents.
SECTION 13.10 Performance of Duties. The Borrower's obligations under
this Agreement and each of the other Loan Documents shall be performed by the
Borrower at its sole cost and expense.
SECTION 13.11 No Fiduciary Relationship. Notwithstanding any provision
to the contrary elsewhere in this Agreement or the other Loan Documents, neither
the Agent nor any Lender shall have any duties or responsibilities, except those
expressly set forth herein and therein, or any fiduciary relationship with the
Borrower or any of its Subsidiaries.
SECTION 13.12 All Powers Coupled with Interest. All powers of attorney
and other authorizations granted to the Lenders, the Agents and any Persons
designated by any Agent or Lender pursuant to any provisions of this Agreement
or any of the other Loan Documents shall be deemed coupled with an interest and
shall be irrevocable so long as any of the Obligations remain unpaid or
unsatisfied or the Credit Facility has not been terminated.
SECTION 13.13 Survival of Indemnities. Notwithstanding any termination
of this Agreement, the indemnities to which the Agents and the Lenders are
entitled under the provisions of this Article XIII and any other provision of
this Agreement and the other Loan Documents shall continue in full force and
effect and shall protect the Agents and Lenders against events arising after
such termination as well as before.
SECTION 13.14 Titles and Captions Titles and captions of Articles,
Sections and subsections in this Agreement are for convenience only, and neither
limit nor amplify the provisions of this Agreement.
SECTION 13.15 Severability of Provisions. Any provision of this
Agreement or any other Loan Document which is prohibited or unenforceable in any
jurisdiction shall, as to such jurisdiction, be ineffective only to the extent
of such prohibition or unenforceability
76
without invalidating the remainder of such provision or the remaining provisions
hereof or thereof or affecting the validity or enforceability of such provision
in any other jurisdiction.
SECTION 13.16 Counterparts. This Agreement may be executed in any
number of counterparts and by different parties hereto in separate counterparts,
each of which when so executed shall be deemed to be an original and shall be
binding upon all parties, their successors and assigns, and all of which taken
together shall constitute one and the same agreement.
SECTION 13.17 Term of Agreement. This Agreement shall remain in effect
from the Closing Date through and including the date upon which all Obligations
shall have been indefeasibly and irrevocably paid and satisfied in full. No
termination of this Agreement shall affect the rights and obligations of the
parties hereto arising prior to such termination.
SECTION 13.18 Independent Effect of Covenants. The Borrower expressly
acknowledges and agrees that each covenant contained in Articles VIII, IX or X
hereof shall be given independent effect. Accordingly, the Borrower shall not
engage in any transaction or other act otherwise permitted under any covenant
contained in Articles VIII, IX or X if, before or after giving effect to such
transaction or act, the Borrower shall or would be in breach of any other
covenant contained in Articles VIII, IX or X.
SECTION 13.19 EMU; Continuity of Contract. The parties hereto confirm
that the occurrence or non-occurrence of an EMU Event will not have the effect
of altering any term of, or discharging or excusing performance under, this
Agreement or any other Loan Document, give any party the right unilaterally to
alter or terminate this Agreement or any other Loan Document or, in and of
itself, give rise to an Event of Default, provided, however, that no currency
shall be included as an Alternative Currency within the meaning of the
definition thereof if the Administrative Agent or any Lender reasonably believes
that it is impracticable or impossible for any Lender to fund Loans in such
currency.
77
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their duly authorized officers, all as of the day and year first
written above.
[CORPORATE SEAL] INSIGNIA/ESG HOLDINGS, INC.
By: /s/ Xxxx X. Xxxxxxx
-----------------------------------
Name: Xxxx X. Xxxxxxx
-----------------------------
Title: Executive Vice President
----------------------------
FIRST UNION NATIONAL BANK,
as Administrative Agent and Lender
By: /s/ Xxxxx X. Xxxxxx
-----------------------------------
Name: Xxxx X. Xxxxxx
-----------------------------
Title: Vice President
----------------------------
XXXXXX COMMERCIAL PAPER INC., as
Syndication Agent and Lender
By: /s/ Xxxxxxx X. Xxxxxxxxx
-----------------------------------
Name: Xxxxxxx X. Xxxxxxxxx
-----------------------------
Title: Syndication Agent
----------------------------
BANK AUSTRIA CREDITANSTALT
CORPORATE FINANCE, INC.
By: /s/ Xxxx Xxxxxxxx
-----------------------------------
Name: Xxxx Xxxxxxxx
-----------------------------
Title: Associate
----------------------------
By: /s/ Xxxxxxx X. XxXxxxxx, Xx.
-----------------------------------
Name: Xxxxxxx X. XxXxxxxx, Xx.
-----------------------------
Title: Senior Associate
----------------------------
THE BANK OF NEW YORK
By /s/ Xxxxxxx Xxxxx
-----------------------------------
Name: Xxxxxxx Xxxxx
-----------------------------
Title: Vice President
----------------------------
BARCLAYS BANK PLC
By: /s/ Xxxxxxx Xxxx
-----------------------------------
Name: Xxxxxxx Xxxx
-----------------------------
Title: Associate Director/V.P.
----------------------------
LASALLE NATIONAL BANK
By: /s/ Xxxxx Xxxx Xxx
-----------------------------------
Name: Xxxxx Xxxx Xxx
-----------------------------
Title: Comm. Banking Officer
----------------------------
NATIONAL BANK OF SOUTH CAROLINA
By: /s/ Xxxx X. Xxxx, Xx.
-----------------------------------
Name: Xxxx X. Xxxx, Xx.
-----------------------------
Title: Vice President
----------------------------
NATIONAL CITY BANK
By: /s/ Xxxx X. Xxxxx
-----------------------------------
Name: Xxxx X. Xxxxx
-----------------------------
Title: Vice President
----------------------------
NATIONSBANK, N.A.
By: /s/ Xxx X. Xxxxxxxx
-----------------------------------
Name: Xxx X. Xxxxxxxx
-----------------------------
Title: Vice President
----------------------------
Schedule 1.1(b)
MANDATORY COST RATE
(1) The Mandatory Cost Rate for an Alternative Currency Loan for its
Interest Period(s) is the rate per annum determined by the
Administrative Agent to be the rate calculated by it in accordance
with the following formula:
(a) in relation to an Alternative Currency Loan denominated in
Pounds Sterling:
BY + S(Y - Z) + F x 0.01% per annum
-----------------------------------
100 - (B + S)
(b) in relation to any other Alternative Currency Loan in an
Alternative Currency:
F x 0.01% per annum
-------------------
300
(c) where on the date of calculation:
B is the average of the percentage of eligible liabilities (in
excess of any stated minimum) which the Bank of England then
requires each of the Lenders to maintain on a non-interest
bearing account in accordance with its cash ratio
requirements;
Y is LIBOR for the Interest Period of the relevant Loan;
S is the average percentage of eligible liabilities which the
Bank of England requires each Lender to place as a special
deposit;
Z is the interest rate per annum allowed by the Bank of England
on special deposits; and
F is the average of the percentage of the charges payable by the
Lenders to the Financial Services Authority under paragraph
2.02 or 2.03 (as appropriate) of the Fees Regulations (but
where for the purpose of this calculation, any minimum amount
required to be paid to the Financial Services Authority under
paragraph 2.02b or 2.03b will not be deemed to apply)
expressed in pounds per (pound)1 million of the average of
percentage of the fee bases of the Lenders.
(2) For the purposes of this Schedule 1.1(b):
(a) "eligible liabilities" and "special deposits" have the
meanings given to them at the time of application of the
formula by the Bank of England;
(b) "fee base" has the meaning given to it in the Fees
Regulations; and
(c) "Fees Regulations" means:
(i) prior to 31st of March, 1999 the Banking Supervision
(Fees) Regulations 1998; and
(ii) on and after 31st of March 1999, any regulations
governing the payment of fees for banking
supervision;
and any reference to a paragraph or specific provision in The Fees
Regulations in force at the date of this Agreement shall be deemed to
be a reference to any replacement provision in any superceding
regulations under paragraph (2) above.
(3) In the application of the formula, B,Y,S and Z are included in the
formula as figures and not as percentages e.g., if B = 0.05% and Y =
15%, BY is calculated as 0.05 x 15.
(4) (a) The formula is applied on the date the interest rate is
determined for the relevant Interest Period of the Loan; and
(b) Each rate calculated in accordance with the formula is, if
necessary, rounded upward to the nearest four decimal places.
(5) If the Administrative Agent determines that a change in circumstances has
rendered or will render the formula inappropriate, the Administrative Agent
(after consultation with and by notice to the Lenders and the Borrower) shall
modify the manner in which the Mandatory Cost Rate will subsequently be
calculated and specify the date from which such modification will apply. The
manner of calculation so notified by the Administrative Agent shall in the
absence of manifest error be binding on all the parties hereto.
Schedule 6.1(t)
LITIGATION
None.
Schedule 10.6
PERMITTED ASSET SALES
None.
