EXHIBIT 10.15
$25,000,000
CREDIT AGREEMENT
Dated as of January 26, 0000
Xxxxx
XXXX XXXXXXX CORPORATION
as Borrower
and
MEDE AMERICA CORPORATION OF OHIO
and
HEALTHCARE INTERCHANGE, INC.
as Guarantors
and
THE INITIAL LENDERS NAMED HEREIN
as Initial Lenders
and
NATIONSBANK, N.A.
as Administrative Agent
and
NATIONSBANC XXXXXXXXXX SECURITIES LLC
as Syndication Agent
T A B L E O F C O N T E N T S
Section Page
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
1.01. Certain Defined Terms.............................................2
1.02. Computation of Time Periods; Other Definitional Provisions.......26
1.03. Accounting Terms.................................................27
1.04. Currency Equivalents Generally...................................27
ARTICLE II
AMOUNTS AND TERMS OF THE
WORKING CAPITAL ADVANCES
2.01. The Working Capital Advances.....................................27
2.02. Making the Working Capital Advances..............................27
2.03. Repayment of Working Capital Advances............................29
2.04. Termination or Reduction of the Commitments......................29
2.05. Prepayments......................................................30
2.06. Interest.........................................................31
2.07. Fees.............................................................32
2.08. Conversion of Working Capital Advances...........................32
2.09. Increased Costs, Etc.............................................34
2.10. January 23, 1999 Payments and Computations.......................36
2.11. Taxes............................................................39
2.12. Sharing of Payments, Etc.........................................42
2.13. Use of Proceeds..................................................42
2.14. Defaulting Lenders...............................................42
ARTICLE III
CONDITIONS OF LENDING
3.01. Conditions Precedent to Initial Extension of Credit..............45
3.02. Conditions Precedent to Each Working Capital Borrowing...........49
3.03. Determinations Under Section 3.01................................50
ii
Section Page
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
4.01. Representations and Warranties of the Borrower...................50
ARTICLE V
COVENANTS OF THE BORROWER
5.01. Affirmative Covenants............................................58
5.02. Negative Covenants...............................................66
5.03. Reporting Requirements...........................................72
5.04. Financial Covenants................................................
ARTICLE VI
EVENTS OF DEFAULT
6.01. Events of Default................................................78
ARTICLE VII
GUARANTY
7.01. Guaranty; Limitation of Liability................................81
7.02. Guaranty Absolute................................................82
7.03. Waivers and Acknowledgments......................................83
7.04. Subrogation......................................................84
7.05. Guaranty Supplements.............................................85
7.06. Subordination....................................................85
7.07. Continuing Guaranty; Assignments.................................86
ARTICLE VIII
THE AGENTS
8.01. Authorization and Action.........................................86
8.02. Administrative Agent's Reliance, Etc.............................87
iii
Section Page
8.03. NationsBank, NMS and Affiliates..................................88
8.04. Lender Credit Decision...........................................88
8.05. Indemnification..................................................89
8.06. Successor Administrative Agent...................................89
ARTICLE IX
MISCELLANEOUS
9.01. Amendments, Etc..................................................90
9.02. Notices, Etc.....................................................91
9.03. No Waiver; Remedies..............................................92
9.04. Costs and Expenses...............................................92
9.05. Right of Set-off.................................................94
9.06. Binding Effect...................................................94
9.07. Assignments and Participations...................................95
9.08. Execution in Counterparts........................................98
9.09. Confidentiality..................................................98
9.10. Jurisdiction, Etc................................................98
9.11. Governing Law....................................................99
9.12. Waiver of Jury Trial.............................................99
iv
SCHEDULES
Schedule I - Commitments and Applicable Lending Offices
Schedule 4.01 (a) - List of Equity Interests of the Borrower
Schedule 4.01 (b) - List of all Subsidiaries of the Borrower
Schedule 4.01 (d) - List of Approvals, Consents and Governmental Authorizations
Schedule 4.01 (f) - List of Liabilities Not Reflected in Financial Statements
Schedule 4.01 (z) - List of Real Property
Schedule 4.01 (bb) - List of Intellectual Property
Schedule 4.01 (v) - List of each Open Year
Schedule 4.01 (y) - Debt
Schedule 5.01 (n) - List of Real Property Subject to Mortgages
Schedule 5.02 (a) - List of Existing Liens
Schedule 5.02 (e) - List of Existing Investments
EXHIBITS
Exhibit A - Form of Working Capital Note
Exhibit B-1 - Form of Notice of Borrowing
Exhibit B-2 - Form of Notice of Conversion
Exhibit C - Form of Assignment and Acceptance
Exhibit D - Form of Security Agreement
Exhibit E - Form of Guaranty Supplement
Exhibit F - [Intentionally omitted]
CREDIT AGREEMENT
CREDIT AGREEMENT dated as of January 26, 1999 among MEDE
AMERICA CORPORATION, a Delaware corporation (the "Borrower"), MEDE AMERICA
CORPORATION OF OHIO, an Ohio corporation, and HEALTHCARE INTERCHANGE, INC., a
Missouri corporation (each, a "Guarantor" and together with each other
Additional Guarantor (as defined in Section 7.05), the "Guarantors"), the banks,
financial institutions and other institutional lenders listed on the signature
pages hereof under the caption "Initial Lenders" (the "Initial Lenders"),
NATIONSBANC XXXXXXXXXX SECURITIES LLC ("NMS"), as the syndication agent and
arranger (the "Syndication Agent") for the Facilities (as hereinafter defined)
hereunder, and NATIONSBANK, N.A. ("NationsBank"), as the administrative and
collateral agent (together with any successor thereto appointed pursuant to
Article VIII, the "Administrative Agent") for the Lenders (as hereinafter
defined).
PRELIMINARY STATEMENTS:
(1) The Borrower is a corporation organized under the laws of
the State of Delaware, and the Borrower and the Guarantors are engaged in the
business of providing electronic data interchange products and services to the
health-care industry.
(2) The Borrower has requested that the Lenders make Working
Capital Advances to the Borrower from time to time prior to the Termination Date
in an aggregate principal amount not to exceed $25,000,000 at any time
outstanding. The Lenders have indicated their willingness to agree to lend such
amounts on the terms and conditions of this Agreement.
(3) The Borrower is the owner, beneficially and of record, of
all issued and outstanding common stock of each of the Guarantors, and each of
the Guarantors will receive substantial direct and indirect benefit from this
Agreement.
(4) Each of the Guarantors has agreed to guarantee the prompt
and complete payment when due of the Guaranteed Obligations in accordance with
Article VII hereof.
NOW, THEREFORE, in consideration of the premises and of the
mutual covenants and agreements contained herein, the parties hereto hereby
agree as follows:
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ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
SECTION 1.01. Certain Defined Terms. As used in this
Agreement, the following terms shall have the following meanings (such meanings
to be equally applicable to both the singular and the plural forms of the terms
defined):
"Acquisition Certificate" has the meaning specified in Section
5.02(e)(vii).
"Administrative Agent" has the meaning specified in the
recital of parties to this Agreement.
"Administrative Agent's Account" means the account of the
Administrative Agent maintained by the Administrative Agent with
NationsBank at its office at 000 Xxxxx Xxxxx Xxxxxx, Xxxxxxxxx, Xxxxx
Xxxxxxxx 00000, and designated by the Administrative Agent as such in a
written notice to the Borrower and each of the Lenders or such other
account of the Administrative Agent that may be so designated from time
to time.
"Advance" means a Working Capital Advance.
"Affiliate" means, with respect to any Person, any other
Person that, directly or indirectly, controls, is controlled by or is
under common control with such Person or is a director or officer of
such Person. For purposes of this definition, the term "control"
(including the terms "controlling," "controlled by" and "under common
control with") of a Person means the possession, direct or indirect, of
the power to vote 5% or more of the Voting Interests of such Person or
to direct or cause the direction of the management and policies of such
Person, whether through the ownership of Voting Interests, by contract
or otherwise.
"Agents" means, collectively, the Administrative Agent, the
Syndication Agent and each co-agent or sub-agent appointed by the
Administrative Agent from time to time pursuant to Section 8.01(b).
"Agreement Value" means, for each Hedge Agreement, on any date
of determination, an amount determined by the Administrative Agent
equal to: (a) in the case of a Hedge Agreement documented pursuant to
the Master Agreement (Multicurrency-Cross Border) published by the
International Swap and Derivatives Association, Inc. (the "Master
Agreement"), the amount, if any, that would be payable by any Loan
Party or any of its Subsidiaries to its counterparty to such Hedge
Agreement, as if (i) such Hedge Agreement was being terminated early on
such date of determination, (ii) such Loan Party or Subsidiary was the
sole "Affected Party", and (iii) the Administrative Agent was the sole
party
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determining such payment amount (with the Administrative Agent making
such determination pursuant to the provisions of the form of Master
Agreement); or (b) in the case of a Hedge Agreement traded on an
exchange, the xxxx-to-market value of such Hedge Agreement, which will
be the unrealized loss on such Hedge Agreement to the Loan Party or
Subsidiary of a Loan Party party to such Hedge Agreement determined by
the Administrative Agent based on the settlement price of such Hedge
Agreement on such date of determination, or (c) in all cases, the
xxxx-to-market value of such Hedge Agreement, which will be the
unrealized loss on such Hedge Agreement to the Loan Party or Subsidiary
of a Loan Party party to such Hedge Agreement determined by the
Administrative Agent as the amount, if any, by which (i) the present
value of the future cash flows to be paid by such Loan Party or
Subsidiary exceeds (ii) the present value of the future cash flows to
be received by such Loan Party or Subsidiary pursuant to such Hedge
Agreement; capitalized terms used and not otherwise defined in this
definition shall have the respective meanings set forth in the above
described Master Agreement.
"Applicable Lending Office" means, with respect to each
Lender, such Lender's Base Rate Lending Office in the case of a Base
Rate Advance and such Lender's Eurodollar Lending Office in the case of
a Eurodollar Rate Advance.
"Applicable Margin" means (i) 0.75% per annum for Base Rate
Advances and (ii) 1.75% per annum for Eurodollar Rate Advances.
"Assigned Agreements" has the meaning specified in the
Security Agreement.
"Assignment and Acceptance" means an assignment and acceptance
entered into by a Lender and an Eligible Assignee, and accepted by the
Administrative Agent, in accordance with Section 9.07 and in
substantially the form of Exhibit C hereto.
"Average Market Price" shall mean, with respect to each share
of Borrower Common Stock at any date, the average of the per share last
reported sales prices for the twenty consecutive business days (a
"business day" being any day that is not a legal holiday or other day
on which banking institutions or any national securities exchanges are
authorized by law or executive order to close) next preceding the date
in question. The "last reported sales price" for each business day
shall be (i) the last reported sales price of the Borrower Common Stock
on the National Market System of the National Association of Securities
Dealers, Inc., Automated Quotation System ("NASDAQ"), or any similar
system of automated dissemination of quotations of securities prices
then in common use, if so quoted, or (ii) if not quoted as described in
clause (i), the mean between the high bid and low asked quotations for
the Borrower Common Stock as reported by NASDAQ if at least two
securities dealers have inserted both bid and asked quotations for
Borrower Common Stock on at least 5 of the 10 preceding days, or (iii)
if the Borrower Common Stock is listed or admitted for trading on any
national securities exchange, the last sale price, or the closing bid
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price if no sale occurred, of the Borrower Common Stock on the
principal securities exchange on which the Borrower Common Stock is
listed. If the Borrower Common Stock is quoted on a market or quotation
system described above, the closing price shall be determined in the
manner set forth in clause (ii) of the preceding sentence if bid and
asked quotations are reported but actual transactions are not, and in
the manner set forth in clause (iii) of the preceding sentence if
actual transactions are reported. If none of the conditions set forth
above is met, the closing price of the Borrower Common Stock on any
business day or the average of such closing prices for any period shall
be the fair market value of the Borrower Common Stock as determined by
a member firm of the New York Stock Exchange, Inc. selected by the
Borrower and reasonably acceptable to the Administrative Agent.
"Bankruptcy Law" means any proceeding of the type referred to
in Section 6.01(f) or Title 11, U.S. Code, or any similar foreign,
federal or state law for the relief of debtors.
"Base Rate" means a fluctuating interest rate per annum in
effect from time to time, which rate per annum shall at all times be
equal to the higher of:
(a) the rate of interest established by NationsBank
from time to time as its prime rate (which rate of interest
may not be the lowest rate of interest charged by NationsBank
to its customers); and
(b) the Federal Funds Rate plus 0.50%.
"Base Rate Advance" means an Advance that bears interest as
provided in Section 2.06(a)(i).
"Base Rate Lending Office" means, with respect to each of the
Lenders, the office of such Lender specified as its "Base Rate Lending
Office" opposite its name on Schedule I hereto or in the Assignment and
Acceptance pursuant to which it became a Lender, as the case may be, or
such other office of such Lender as such Lender may from time to time
specify to the Borrower and the Administrative Agent for such purpose.
"Blocked Account Letters" has the meaning specified in the
Security Agreement.
"Blocked Accounts" has the meaning specified in the Security
Agreement.
"Borrower" has the meaning specified in the recital of parties
to this Agreement.
"Borrower Common Stock " has the meaning specified in Section
3.01(g).
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"Borrower's Account" means the account of the Borrower
designated to the Administrative Agent on or prior to the Funding Date
or such other account of such Borrower as is agreed from time to time
in writing between the Borrower and the Administrative Agent.
"Borrowing" means a Working Capital Borrowing.
"Business Day" means a day of the year on which banks are not
required or authorized by law to close in New York, New Xxxx,
Xxxxxxxxx, North Carolina or San Francisco, California and, if the
applicable Business Day relates to any Eurodollar Rate Advances, on
which dealings are carried on in the London interbank market.
"Capital Assets" means, with respect to any Person, all
equipment, fixed assets and real property or improvements of such
Person, or replacements or substitutions therefor or additions thereto,
that, in accordance with GAAP, have been or should be reflected as
additions to property, plant or equipment on the balance sheet of such
Person or that have a useful life of more than one year.
"Capital Expenditures" means, with respect to any Person for
any period, (a) all expenditures made directly or indirectly by such
Person during such period for Capital Assets (whether paid in cash or
other consideration and including, without limitation, all expenditures
for maintenance and repairs which are required, in accordance with
GAAP, to be capitalized on the books of such Person) and (b) solely to
the extent not otherwise included in clause (a) of this definition, the
aggregate principal amount of all Debt (including, without limitation,
Obligations in respect of Capitalized Leases) assumed or incurred
during such period in connection with any such expenditures for Capital
Assets. For purposes of this definition, the purchase price of
equipment that is purchased simultaneously with the trade-in of
existing equipment or with insurance proceeds shall be included in
Capital Expenditures only to the extent of the gross amount by which
such purchase price exceeds the credit granted by the seller of such
equipment for the equipment being traded in at such time or the amount
of such insurance proceeds, as the case may be.
"Capitalized Lease" means any lease with respect to which the
lessee is required to recognize concurrently the acquisition of
property or an asset and the incurrence of a liability in accordance
with GAAP.
"Cash Collateral Account" has the meaning specified in the
Security Agreement.
"Cash Equivalents" means any of the following types of
Investments, to the extent owned by the Borrower or any of its
Subsidiaries free and clear of all Liens (other than Liens created
under the Collateral Documents):
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(a) readily marketable obligations issued or directly
and fully guaranteed or insured by the United States of
America or any agency or instrumentality thereof having
maturities of not more than 360 days from the date of
acquisition thereof; provided that the full faith and credit
of the United States of America is pledged in support thereof;
(b) time deposits with, or insured certificates of
deposit or bankers' acceptances of, any commercial bank that
(i) (A) is a Lender or (B) is organized under the laws of the
United States of America, any state thereof or the District of
Columbia or is the principal banking subsidiary of a bank
holding company organized under the laws of the United States
of America, any state thereof or the District of Columbia, and
is a member of the Federal Reserve System, (ii) issues (or the
parent of which issues) commercial paper rated as described in
clause (c) of this definition and (iii) has combined capital
and surplus of at least $500,000,000, in each case with
maturities of not more than 180 days from the date of
acquisition thereof; and
(c) commercial paper issued by any Person organized
under the laws of any state of the United States of America
and rated at least "Prime-1" (or the then equivalent grade) by
Xxxxx'x or at least "A-1" (or the then equivalent grade) by
S&P, in each case with maturities of not more than 180 days
from the date of acquisition thereof; and
(d) Investments, classified in accordance with GAAP
as current assets of the Borrower or any of its Subsidiaries,
in money market investment programs registered under the
Investment Company Act of 1940, as amended, which are
administered by financial institutions that have the highest
rating obtainable from either Xxxxx'x or S&P, and the
portfolios of which are limited solely to Investments of the
character and quality described in clauses (a), (b) and (c) of
this definition.
"CERCLA" means the Comprehensive Environmental Response,
Compensation and Liability Act of 1980, as amended from time to time.
"CERCLIS" means the Comprehensive Environmental Response,
Compensation and Liability Information System maintained by the U.S.
Environmental Protection Agency.
"Change of Control" means, at any time:
(a) the WCAS Funds, collectively, shall cease to own
and control legally and beneficially, either directly or
indirectly, less than 20% of the shares of the Borrower Common
Stock owned by the WCAS Funds immediately after giving effect
to the recapitalization described in the Registration
Statement (as adjusted for
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stock splits, stock dividends, reverse stick splits, mergers,
consolidations and other like events);
(b) any "person" or "group" (each as used in Sections
13(d)(3) and 14(d)(2) of the Securities Exchange Act of 1934,
as amended) becomes the "beneficial owner" (as defined in Rule
13d-3 of the Securities Exchange Act of 1934, as amended),
directly or indirectly, of Voting Interests in the Borrower
(including through securities convertible into or exchangeable
for such Voting Interests) representing 15% or more of the
combined voting power of all of the Voting Interests in the
Borrower;
(c) the replacement of a majority of the board of
directors of the Borrower during a two-year period from the
directors who constituted the board of directors of the
Borrower at the beginning of such period, and such replacement
shall not have been approved by a vote of at least a majority
of the board of directors of the Borrower then still in office
who either were members of such board of directors at the
beginning of such period or whose election as a member of such
board of directors was previously so approved;
(d) any Person or two or more Persons acting in
concert other than the one or more of the WCAS Funds shall
have acquired by contract or otherwise, or shall have entered
into a contract or arrangement that, upon consummation
thereof, will result in its or their acquisition of the power
to exercise, directly or indirectly, control over Voting
Interests in the Borrower (including through securities
convertible into or exchangeable for such Voting Interests)
representing 15% or more of the combined voting power of all
of the Voting Interests in the Borrower; or
(e) with respect to any pledge or other security
agreement covering all or any portion of the Equity Interests
that are owned beneficially and of record by the WCAS Funds or
their nominees, any secured party or pledgee thereunder shall
become the holder of record of any such shares (except in the
case of a registration of the pledge of such Equity Interests
to such secured party or pledgee solely in its capacity as a
pledgee) or shall receive dividends or other cash or cash
equivalent distributions (including, without limitation, stock
repurchases) in respect thereof, or shall proceed to exercise
voting or other consensual rights in respect thereof (whether
by proxy, voting or other similar arrangement or otherwise),
or shall otherwise commence to realize upon such shares.
"Collateral" means all of the "Collateral" referred to in the
Collateral Documents and all of the other property and assets that are
or are intended under the terms of the Collateral Documents to be
subject to Liens in favor of the Administrative Agent for the benefit
of the Secured Parties.
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"Collateral Agent" means the Administrative Agent in its
capacity as such under the Security Agreement.
"Collateral Documents" means, collectively, the Security
Agreement, the Mortgages, the Blocked Account Letters and each of the
other agreements that creates or purports to create a Lien in favor of
the Administrative Agent for the benefit of the Secured Parties.
"Commitment" means a Term Commitment or a Working Capital
Commitment, as the context may require.
"Commitment Fee" has the meaning specified in Section 2.07(a).
"Confidential Information" means information that is furnished
to the Administrative Agent or any Lender by or on behalf of the
Borrower pursuant hereto but does not include any such information that
(a) is or becomes generally available to the public other than as a
result of a breach by the Administrative Agent or any Lender of its
obligations hereunder or (b) is or becomes available to the
Administrative Agent or any such Lender from a source other than the
Borrower.
"Consolidated" refers to the consolidation of accounts in
accordance with GAAP.
"Consolidated EBITDA" means, with respect to any Person for
any period, (a) the Consolidated Net Income of such Person and its
Subsidiaries for such period plus (b) the sum of each of the following
expenses that have been deducted from the determination of the
Consolidated Net Income of such Person and its Subsidiaries for such
period: (i) the Consolidated Interest Expense of such Person and its
Subsidiaries for such period, (ii) all income tax expense (whether
federal, state, local, foreign or otherwise) of such Person and its
Subsidiaries for such period, (iii) all depreciation expense of such
Person and its Subsidiaries for such period, (iv) all amortization
expense of such Person and its Subsidiaries for such period, (v) all
other non-cash items (including extraordinary losses) deducted in
determining the Consolidated Net Income of such Person and its
Subsidiaries for such period less all other non-cash items (including
extraordinary gains) added in determining the Consolidated Net Income
of such Person and its Subsidiaries, for such period, in each case
determined on a Consolidated basis and in accordance with GAAP for such
period and (vi) in the case of the Borrower and its Subsidiaries,
non-recurring charges incurred by the Borrower and its Subsidiaries in
connection with a Permitted Acquisition; provided that such changes do
not exceed 5% of the aggregate consideration paid in connection with
such Permitted Acquisition; and provided, further, that, if
Consolidated EBITDA of the Borrower and its Subsidiaries is being
calculated in respect of any Measurement Period in which a Permitted
Acquisition has been consummated, there shall be added thereto or
subtracted therefrom an amount equal to the product of (1) the
Consolidated EBITDA (whether positive or negative) of the Person
acquired (or reasonably attributable to the assets acquired) for the
9
one year period immediately preceding the date such Permitted
Acquisition was consummated times (2) a fraction the numerator of which
is number of days from the first day of such Measurement Period to the
date the Permitted Acquisition was consummated and the denominator of
which is 365.
"Consolidated Interest Expense" means, with respect to any
Person for any period, the gross interest expense accrued on all
Indebtedness of such Person and its Subsidiaries during such period,
determined on a Consolidated basis and in accordance with GAAP for such
period, including, without limitation, (i) in the case of the Borrower,
(A) interest expense accrued in respect of Debt resulting from Working
Capital Advances and (B) all fees paid or payable pursuant to Section
2.07(a), and (ii) the interest component of all Obligations in respect
of Capitalized Leases, (iii) commissions, discounts and other fees and
charges paid or payable in connection with letters of credit, (iv) all
amortization of original issue discount in respect of all Debt of such
Person and its Subsidiaries and (v) the net payment, if any, paid or
payable in connection with Hedge Agreements less the net credit, if
any, received in connection with Hedge Agreements.
"Consolidated Net Income" means, for any period, the net
income (or net loss) of any Person and its Subsidiaries for such
period, determined on a Consolidated basis and in accordance with GAAP,
but excluding for each such period (without duplication):
(a) the income (or loss) of any other Person accrued
prior to the date on which it became a Subsidiary of such
Person or is merged into or consolidated with such Person or
any of its Subsidiaries or all or substantially all of the
property and assets of such other Person are acquired by such
Person or any of its Subsidiaries;
(b) the income (or loss) of any other Person (other
than a Subsidiary of such Person) in which a Person other than
such Person or any of its Subsidiaries owns or otherwise holds
an Equity Interest, except to the extent such income (or loss)
shall have been received in the form of cash dividends or
other distributions actually paid to such Person or any of its
Subsidiaries by such other Person during such period;
(c) the income of any Subsidiary of such Person to
the extent that the declaration or payment of dividends or
other distributions by such Subsidiary of such income is not
permitted to be made or paid on the last day of such period;
(d) any gains or losses (on an after-tax basis)
attributable to the sale, lease, transfer or other disposition
of any property or assets of such Person or any of its
Subsidiaries other than sales by the Loan Parties of
electronic data interchange products and services in the
ordinary course of business;
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(e) any earnings or charges resulting from the
write-up or write-down of any property or assets of such
Person or any of its Subsidiaries other than in the ordinary
course of business;
(f) any gains attributable to the collection of
proceeds of insurance policies; and
(g) to the extent not included in clauses (a) through
(e) of this definition, the noncash portion of all
extraordinary losses deducted in calculating net income and
the noncash portion of all extraordinary gains added in
calculating net income.
"Constitutive Documents" means, with respect to any Person,
the certificate of incorporation or registration (including, if
applicable, certificate of change of name), articles of incorporation
or association, memorandum of association, charter, bylaws, partnership
agreement, trust agreement, joint venture agreement, limited liability
company operating or members agreement, joint venture agreement or one
or more similar agreements, instruments or documents constituting the
organization or formation of such Person.
"Contingent Obligation" means, with respect to any Person, any
Obligation or arrangement of such Person to guarantee or intended to
guarantee any Debt, leases, dividends or other obligations ("primary
obligations") of any other Person (the "primary obligor") in any
manner, whether directly or indirectly, including, without limitation,
(a) the direct or indirect guarantee, endorsement (other than for
collection or deposit in the ordinary course of business), co-making,
discounting with recourse or sale with recourse by such Person of the
Obligation of a primary obligor, (b) the Obligation to make take-or-pay
or similar payments, if required, regardless of nonperformance by any
other party or parties to an agreement or (c) any Obligation of such
Person, whether or not contingent, (i) to purchase any such primary
obligation or any property constituting direct or indirect security
therefor, (ii) to advance or supply funds (A) for the purchase or
payment of any such primary obligation or (B) to maintain working
capital or equity capital of the primary obligor or otherwise to
maintain the net worth or solvency of the primary obligor, (iii) to
purchase property, assets, securities or services primarily for the
purpose of assuring the owner of any such primary obligation of the
ability of the primary obligor to make payment of such primary
obligation or (iv) otherwise to assure or hold harmless the holder of
such primary obligation against loss in respect thereof. The amount of
any Contingent Obligation shall be deemed to be an amount equal to the
stated or determinable amount of the primary obligation in respect of
which such Contingent Obligation is made (or, if less, the maximum
amount of such primary obligation for which such Person may be liable
pursuant to the terms of the instrument evidencing such Contingent
Obligation) or, if not stated or determinable, the maximum reasonably
anticipated liability in respect thereof (assuming such Person is
required to perform thereunder), as determined by such Person in good
faith.
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"Conversion", "Convert" and "Converted" each refer to a
conversion of Working Capital Advances of one Type into Working Capital
Advances of the other Type pursuant to Section 2.08 or 2.09.
"Current Assets" means, with respect to any Person, all assets
of such Person that, in accordance with GAAP, would be classified as
current assets on the balance sheet of a company conducting a business
the same as or similar to that of such Person, after deducting
appropriate and adequate reserves therefrom in each case in which a
reserve is proper in accordance with GAAP.
"Debt" means, with respect to any Person (without duplication)
(a) all indebtedness of such Person for borrowed money, (b) all
Obligations of such Person for the deferred purchase price of property
or services (other than trade payables incurred in the ordinary course
of such Person's business and not past due for more than 90 days after
the date on which each such trade payable or account payable was
created), (c) all Obligations of such Person evidenced by notes, bonds,
debentures or other similar instruments, or upon which interest
payments are customarily made, (d) all Obligations of such Person
created or arising under any conditional sale or other title retention
agreement with respect to property acquired by such Person (even though
the rights and remedies of the seller or lender under such agreement in
the event of default are limited to repossession or sale of such
property), (e) all Obligations of such Person as lessee under
Capitalized Leases, (f) all Obligations, contingent or otherwise, of
such Person under acceptance, letter of credit or similar facilities,
(g) all Obligations of such Person to purchase, redeem, retire, defease
or otherwise make any payment in respect of any Equity Interests in
such Person or any other Person, valued, in the case of Redeemable
Preferred Interests, at the greater of its voluntary or involuntary
liquidation preference plus accrued and unpaid dividends, (h) all
Obligations of such Person in respect of Hedge Agreements, take-or-pay
agreements or other similar arrangements, valued, in the case of Hedge
Agreements, at the Agreement Value thereof, (i) all Obligations of such
Person under any synthetic lease, tax retention operating lease,
off-balance sheet loan or similar off-balance sheet financing if the
transaction giving rise to such Obligation is considered indebtedness
for borrowed money for tax purposes but is classified as an operating
lease in accordance with GAAP, (j) all Contingent Obligations, and (k)
all Debt referred to in clauses (a) through (j) above of another Person
secured by (or for which the holder of such Debt has an existing right,
contingent or otherwise, to be secured by) any Lien on property
(including, without limitation, accounts and contract rights) owned by
such Person, even though such Person has not assumed or become liable
for the payment of such Debt.
"Default" means any Event of Default or any event that would
constitute an Event of Default but for the requirement that notice be
given or time elapse or both.
12
"Defaulted Advance" means, with respect to any Lender at any
time, the portion of any Working Capital Advance required to be made by
such Lender to the Borrower pursuant to Section 2.01 or 2.02 at or
prior to such time that has not been made by such Lender or by the
Administrative Agent for the account of such Lender pursuant to Section
2.02(d) as of such time. In the event that a portion of a Defaulted
Advance shall be deemed made pursuant to Section 2.14(a), the remaining
portion of such Defaulted Advance shall be considered a Defaulted
Advance originally required to be made pursuant to Section 2.01 on the
same date as the Defaulted Advance so deemed made in part.
"Defaulted Amount" means, with respect to any Lender at any
time, any amount required to be paid by such Lender to the
Administrative Agent or any other Lender hereunder or under any other
Loan Document at or prior to such time that has not been so paid as of
such time, including, without limitation, any amount required to be
paid by such Lender to the Administrative Agent pursuant to Section
8.05 to reimburse the Administrative Agent such Lender's ratable share
of any amount required to be paid by the Lenders to the Administrative
Agent as provided therein. In the event that a portion of a Defaulted
Amount shall be deemed paid pursuant to Section 2.14(b), the remaining
portion of such Defaulted Amount shall be considered a Defaulted Amount
originally required to be paid hereunder or under any other Loan
Document on the same date as the Defaulted Amount so deemed paid in
part.
"Defaulting Lender" means, at any time, any Lender that, at
such time, (a) owes a Defaulted Advance or a Defaulted Amount or (b)
shall take any action or be the subject of any action or proceeding of
a type described in Section 6.01(f).
"Domestic Subsidiary" means, at any time, any of the direct or
indirect Subsidiaries of the Borrower that is incorporated or organized
under the laws of any state of the United States of America or District
of Columbia.
"Eligible Assignee" means, with respect to any Facility, (i) a
Lender; (ii) an Affiliate of a Lender; or (iii) any other Person
approved by the Administrative Agent and, so long as no Event of
Default has occurred and is continuing at the time the related
assignment is effected pursuant to Section 9.07, the Borrower (in
either case such approval not to be unreasonably withheld or delayed
and, in the case of the Borrower, such approval to be deemed to have
been given if no objection thereto is received by the Administrative
Agent and the assigning Lender within two Business Days after the date
on which notice of the proposed assignment is provided to the
Borrower); provided, however, that neither any Loan Party nor any
Affiliate of a Loan Party shall qualify as an Eligible Assignee under
this definition.
"Environmental Action" means any action, suit, demand, demand
letter, claim, notice of noncompliance or violation, notice of
liability or potential liability, investigation,
13
proceeding, consent order or consent agreement relating in any way to
any Environmental Law, any Environmental Permit or Hazardous Material
or arising from alleged injury or threat to health, safety or the
environment, including, without limitation, (a) by any Governmental
Authority for enforcement, cleanup, removal, response, remedial or
other actions or damages and (b) by any Governmental Authority or any
other Person for damages, contribution, indemnification, cost recovery,
compensation or injunctive relief.
"Environmental Law" means any federal, state, local or foreign
statute, law, ordinance, rule, regulation, code, order, writ, judgment,
injunction, decree or judicial or agency interpretation, policy or
guidance relating to pollution or protection of the environment,
health, safety or natural resources, including, without limitation,
those relating to the use, handling, transportation, treatment,
storage, disposal, release or discharge of Hazardous Materials.
"Environmental Permit" means any permit, approval,
identification number, license or other authorization required under
any Environmental Law.
"Equipment" has the meaning specified in the Security
Agreement.
"Equity Interests" means, with respect to any Person, all of
the shares of capital stock of (or other ownership or profit interests
in) such Person, all of the warrants, options or other rights for the
purchase or acquisition from such Person of shares of capital stock of
(or other ownership or profit interests in) such Person, all of the
securities convertible into or exchangeable for shares of capital stock
of (or other ownership or profit interests in) such Person or warrants,
rights or options for the purchase or acquisition from such Person of
such shares (or such other interests), and all of the other ownership
or profit interests in such Person (including, without limitation,
partnership, member or trust interests therein), whether voting or
nonvoting, and whether or not such shares, warrants, options, rights or
other interests are outstanding on any date of determination.
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended from time to time, and the regulations promulgated and
the rulings issued thereunder.
"ERISA Affiliate" means any Person that for purposes of Title
IV of ERISA is a member of the controlled group of any Loan Party, or
under common control with any Loan Party, within the meaning of Section
414 of the Internal Revenue Code.
"ERISA Event" means (a)(i) the occurrence of a reportable
event, within the meaning of Section 4043 of ERISA, with respect to any
Plan unless the 30-day notice requirement with respect to such event
has been waived by the PBGC or (ii) the requirements of Section 4043(b)
of ERISA apply with respect to a contributing sponsor, as defined in
Section 4001(a)(13) of ERISA, of a Plan, and an event described in
paragraph (9), (10), (11), (12)
14
or (13) of Section 4043(c) of ERISA is reasonably expected to occur
with respect to such Plan within the following 30 days; (b) the
application for a minimum funding waiver with respect to a Plan; (c)
the provision by the administrator of any Plan of a notice of intent to
terminate such Plan pursuant to Section 4041(a)(2) of ERISA (including
any such notice with respect to a plan amendment referred to in Section
4041(e) of ERISA); (d) the cessation of operations at a facility of any
Loan Party or any ERISA Affiliate in the circumstances described in
Section 4062(e) of ERISA; (e) the partial or complete withdrawal by any
Loan Party or any ERISA Affiliate from a Multiple Employer Plan during
a plan year for which it was a substantial employer, as defined in
Section 4001(a)(2) of ERISA; (f) the conditions for imposition of a
lien under Section 302(f) of ERISA shall have been met with respect to
any Plan; (g) the adoption of an amendment to a Plan requiring the
provision of security to such Plan pursuant to Section 307 of ERISA; or
(h) the institution by the PBGC of proceedings to terminate a Plan
pursuant to Section 4042 of ERISA, or the occurrence of any event or
condition described in Section 4042 of ERISA, that constitutes grounds
for the termination of, or the appointment of a trustee to administer,
such Plan.
"Eurocurrency Liabilities" has the meaning specified in
Regulation D of the Board of Governors of the Federal Reserve System,
as in effect from time to time.
"Eurodollar Lending Office" means, with respect to each of the
Lenders, the office of such Lender specified as its "Eurodollar Lending
Office" opposite its name on Schedule I hereto or in the Assignment and
Acceptance pursuant to which it became a Lender, as the case may be
(or, if no such office is specified, its Base Rate Lending Office), or
such other office of such Lender as such Lender may from time to time
specify to the Borrower and the Administrative Agent for such purpose.
"Eurodollar Rate" means, for any Interest Period for all
Eurodollar Rate Advances comprising part of the same Borrowing, an
interest rate per annum equal to the rate per annum obtained by
dividing (a) the rate per annum at which deposits in U.S. dollars
appear on page 3750 (or any successor page thereto) of the Dow Xxxxx
Telerate Screen two Business Days before the first day of such Interest
Period and for a term comparable to such Interest Period or, if such
rate does not so appear on the Dow Xxxxx Telerate Screen on any date of
determination, on the Reuters Screen LIBO Page two Business Days before
the first day of such Interest Period and for a term comparable to such
Interest Period by (b) a percentage equal to 100% minus the Eurodollar
Rate Reserve Percentage for such Interest Period; provided, however,
that if the Reuters Screen LIBO Page is being used to determine the
Eurodollar rate at any date of determination and more than one rate is
specified thereon from deposits in U.S. dollars, the applicable rate
shall be the average of all such rates (rounded upward, if necessary,
to the nearest whole multiple of 1/100 of 1% per annum).
"Eurodollar Rate Advance" means a Working Capital Advance that
bears interest as provided in Section 2.06(a)(ii).
15
"Eurodollar Rate Reserve Percentage" for any Interest Period
for all Eurodollar Rate Advances comprising part of the same Borrowing
means the reserve percentage applicable two Business Days before the
first day of such Interest Period under regulations issued from time to
time by the Board of Governors of the Federal Reserve System (or any
successor) for determining the maximum reserve requirement (including,
without limitation, any emergency, supplemental or other marginal
reserve requirement) for a member bank of the Federal Reserve System in
New York City with respect to liabilities or assets consisting of or
including Eurocurrency Liabilities (or with respect to any other
category of liabilities that includes deposits by reference to which
the interest rate on Eurodollar Rate Advances is determined) having a
term equal to such Interest Period.
"Events of Default" has the meaning specified in Section 6.01.
"Excluded Assigned Agreements" means all of the respective
right, title and interest of the Loan Parties in, to and under those
Assigned Agreements whose terms expressly prohibit the Loan Parties
from assigning their rights and interests thereunder without the
consent of the counterparty thereto; provided that (i) the rights of
the Loan Parties under such Assigned Agreements for money due or to
become to the Loan Parties thereunder and (ii) all amounts actually
paid to the Loan Parties under such Assigned Agreements shall
constitute Collateral and shall be subject to the liens granted to the
Collateral Agent under the Security Agreement.
"Existing Credit Agreement" means the Credit Agreement, dated
as of December 18, 1995, between the Borrower and Bank of America
Illinois, as amended.
"Existing Debt" has the meaning specified in Section 4.01(y).
"Extraordinary Receipt" means any cash received by or paid to
or for the account of any Person not in the ordinary course of
business, including, without limitation, tax refunds, pension plan
reversions, proceeds of insurance (other than proceeds of business
interruption insurance to the extent such proceeds constitute
compensation for lost earnings), condemnation awards (and payments in
lieu thereof), indemnity payments and any purchase price adjustments;
provided, however, that an Extraordinary Receipt shall not include cash
receipts received from proceeds of insurance, condemnation awards (or
payments in lieu thereof) or indemnity payments to the extent that such
proceeds, awards or payments (a) in respect of loss or damage to
equipment, fixed assets or real property are applied (or in respect of
which expenditures were previously incurred) to replace or repair the
equipment, fixed assets or real property in respect of which such
proceeds were received in accordance with the terms of the Loan
Documents, so long as such application is made within six months after
the occurrence of such damage or loss or (b) are received by any Person
in respect of any third party claim against such Person and applied to
pay (or to reimburse such Person for
16
its prior payment of) such claim and the costs and expenses of such
Person with respect thereto.
"Facility" means the Working Capital Facility.
"Federal Funds Rate" means, for any period, a fluctuating
interest rate per annum equal for each day during such period to the
weighted average of the rates (rounded upward, if necessary, to the
nearest whole multiple of 1/100 of 1% per annum) on overnight Federal
funds transactions with members of the Federal Reserve System arranged
by Federal funds brokers, as published for such day (or, if such day is
not a Business Day, for the immediately preceding Business Day) by the
Federal Reserve Bank of New York, or, if such rate is not so published
for any day that is a Business Day, the average of the quotations for
such day for such transactions received by the Administrative Agent
from three federal funds brokers of recognized standing selected by it.
"Fiscal Year" means, with respect to the Borrower or any of
its Subsidiaries, the period commencing on July 1 in any calendar year
and ending on the next succeeding June 30 or, if any such Subsidiary
was not in existence on July 1 in any calendar year, the period
commencing on the date on which such Subsidiary is incorporated,
organized, formed or otherwise created and ending on the next
succeeding June 30.
"Funding Date" means the date on which the Initial Extension
of Credit is made hereunder.
"GAAP" has the meaning specified in Section 1.03.
"Governmental Authority" means any nation or government, any
state, province, city, municipal entity or other political subdivision
thereof, and any governmental, executive, legislative, judicial,
administrative or regulatory agency, department, authority,
instrumentality, commission, board or similar body, whether federal,
state, provincial, territorial, local or foreign.
"Guarantee Supplement" has the meaning specified in Section
7.05.
"Guaranteed Obligations" has the meaning specified in Section
7.01.
"Guarantors" has the meaning specified in the recital of
parties to this Agreement.
"Guaranty" means the guaranty of the Guarantors contained in
Article VII hereof.
"Hazardous Materials" means (a) petroleum or petroleum
products, by-products or breakdown products, radioactive materials,
asbestos-containing materials, polychlorinated
17
biphenyls and radon gas and (b) any other chemicals, materials or
substances designated, classified or regulated as hazardous or toxic or
as a pollutant or contaminant under any Environmental Law.
"Hedge Agreements" means, collectively, interest rate swap,
cap or collar agreements, interest rate future or option contracts,
currency swap agreements, currency future or option contracts and other
similar agreements.
"Indemnified Party" has the meaning specified in Section
9.04(b).
"Initial Extension of Credit" means the initial Working
Capital Borrowing.
"Initial Lenders" has the meaning specified in the recital of
parties to this Agreement.
"Initial Public Offering" means the offering and sale of
Borrower Common Stock in accordance with the Registration Statement.
"Insufficiency" means, with respect to any Plan, the amount,
if any, of its unfunded benefit liabilities, as defined in Section
4001(a)(18) of ERISA.
"Interest Period" means, for each Eurodollar Rate Advance
comprising part of the same Borrowing, the period commencing on the
date of such Eurodollar Rate Advance or the date of the Conversion of
any Base Rate Advance into such Eurodollar Rate Advance, and ending on
the last day of the period selected by the Borrower pursuant to the
provisions below and, thereafter, each subsequent period commencing on
the last day of the immediately preceding Interest Period and ending on
the last day of the period selected by the Borrower pursuant to the
provisions below. The duration of each such Interest Period shall be
one, two, three or six months, as the Borrower may, upon notice
received by the Administrative Agent not later than 11:00 A.M.
(Charlotte, North Carolina time) on the third Business Day prior to the
first day of such Interest Period, select; provided, however, that:
(a) the Borrower may not select any Interest Period
with respect to any Eurodollar Rate Advance that ends after
the Termination Date;
(b) Interest Periods commencing on the same date for
Eurodollar Rate Advances comprising part of the same Borrowing
shall be of the same duration;
(c) whenever the last day of any Interest Period
would otherwise occur on a day other than a Business Day, the
last day of such Interest Period shall be extended to occur on
the next succeeding Business Day, provided, however, that, if
such extension would cause the last day of such Interest
Period to occur in the next
18
following calendar month, the last day of such Interest Period
shall occur on the immediately preceding Business Day; and
(d) whenever the first day of any Interest Period
occurs on a day of an initial calendar month for which there
is no numerically corresponding day in the calendar month that
succeeds such initial calendar month by the number of months
equal to the number of months in such Interest Period, such
Interest Period shall end on the last Business Day of such
succeeding calendar month.
"Internal Revenue Code" means the Internal Revenue Code of
1986, as amended from time to time, and the regulations promulgated and
the rulings issued thereunder.
"Inventory" has the meaning specified in the Security
Agreement.
"Investment" means, with respect to any Person, any loan or
advance to such Person, any purchase or other acquisition of Equity
Interests in or Debt of, or the property and assets comprising a
division or business unit or all or a substantial part of the business
of, such Person, any capital contribution to such Person or any other
investment in such Person, including, without limitation, any
acquisition by way of a merger or consolidation (or similar
transaction) and any arrangement pursuant to which the investor incurs
indebtedness of the types referred to in clause (j) or (k) of the
definition of "Debt" set forth in this Section 1.01 in respect of such
Person.
"Lender Indemnified Costs" has the meaning specified in
Section 8.05.
"Lender Parties" means the Lenders.
"Lenders" means, collectively, the Initial Lenders and each
Person that becomes a Lender pursuant to Section 9.07 for so long as
such Initial Lender or Person, as the case may be, shall be a party to
this Agreement.
"Lien" means, with respect to any Person, (a) any mortgage,
lien (statutory or other), pledge, hypothecation, security interest,
charge or other preference or encumbrance of any kind (including,
without limitation, any agreement to give any of the foregoing), (b)
any sale of accounts receivable or chattel paper, or any assignment,
deposit arrangement or lease intended as, or having the effect of,
security, (c) any easement, right of way or other encumbrance on title
to real property or (d) any other interest or title of any vendor,
lessor, lender or other secured party to or of such Person under any
conditional sale or other title retention agreement or any Capitalized
Lease or upon or with respect to any property or asset of such Person
(including, in the case of Equity Interests, voting trust agreements
and other similar arrangements).
19
"Loan Documents" means, collectively, (i) this Agreement, (ii)
the Working Capital Notes, (iii) the Guaranty and (iv) the Collateral
Documents, in each case as amended, supplemented or otherwise modified
hereafter from time to time in accordance with the terms thereof and
section 9.01.
"Loan Parties" means, collectively, the Borrower, the
Guarantors and each of the other Subsidiaries of the Borrower party to
a Guaranty Supplement or any of the Collateral Documents.
"Material Adverse Change" means any material adverse change in
the business, condition (financial or otherwise), operations,
performance, properties or prospects of the Borrower or any of its
Subsidiaries.
"Material Adverse Effect" means a material adverse effect on
(a) the business, condition (financial or otherwise), operations,
performance or properties of any Loan Party, (b) the rights and
remedies of the Administrative Agent or any Lender under any Loan
Document or (c) the ability of any Loan Party to perform its
Obligations under any Loan Document to which it is or is to be a party.
"Measurement Period" means, at any date of determination, the
most recently completed four consecutive fiscal quarters of the
Borrower on or immediately prior to such date or, if less than four
consecutive fiscal quarters of the Borrower have been completed since
the date of the Initial Extension of Credit, the fiscal quarters of the
Borrower that have been completed since the date of the Initial
Extension of Credit.
"Medic Warrant" means the warrant to purchase 1,250,000 shares
of Borrower Common Stock, issued by the Borrower to Medic Computer
Systems, Inc. on July 17, 1998.
"Moody's" means Xxxxx'x Investors Service, Inc.
"Mortgage" has the meaning specified in Section 5.01(n)(i).
"Mortgage Policy" has the meaning specified in Section
5.01(n)(ii)(B).
"Multiemployer Plan" means a multiemployer plan (as defined in
Section 4001(a)(3) of ERISA) to which any Loan Party or any ERISA
Affiliate is making or accruing an obligation to make contributions, or
has within any of the preceding five plan years made or accrued an
obligation to make contributions.
"Multiple Employer Plan" means a single employer plan (as
defined in Section 4001(a)(15) of ERISA) that (a) is maintained for
employees of any Loan Party or any ERISA Affiliate and at least one
Person other than the Loan Parties and the ERISA Affiliates
20
or (b) was so maintained and in respect of which any Loan Party or any
ERISA Affiliate could reasonably be expected to have liability under
Section 4064 or 4069 of ERISA in the event such plan has been or were
to be terminated.
"NationsBank" has the meaning specified in the recital of
parties to this Agreement.
"NMS" has the meaning specified in the recital of parties to
this Agreement.
"Net Cash Proceeds" means, with respect to any sale, lease,
transfer or other disposition of any property or asset, or the
incurrence or issuance of any Debt, or the sale or issuance of any
Equity Interests in any Person, or any Extraordinary Receipt received
by or paid to or for the account of any Person, as the case may be, the
aggregate amount of cash received from time to time (whether as initial
consideration or through payment or disposition of deferred
consideration) by or on behalf of such Person for its own account in
connection with any such transaction, after deducting therefrom only
(without duplication):
(a) reasonable and customary brokerage commissions,
underwriting fees and discounts, reasonable legal fees and
expenses, finder's fees and other similar fees and
commissions; and
(b) the amount of taxes payable in connection with or
as a result of such transaction.
(c) in the case of any sale, lease, transfer or other
disposition of any property or asset, the outstanding
principal amount of, the premium or penalty, if any, on, and
any accrued and unpaid interest on, any Debt (other than the
Debt outstanding under the Loan Documents) that is secured by
a Lien on the property and assets subject to such sale, lease,
transfer or other disposition and is required to be repaid
under the terms thereof as a result of such sale, lease,
transfer or other disposition, and
(d) in the case of any sale, lease, transfer or other
disposition of any property or asset, the amount required to
be reserved, in accordance with GAAP as in effect on the date
on which the Net Cash Proceeds from such sale, lease, transfer
or other disposition are determined, and so reserved, against
liabilities under indemnification obligations, liabilities
related to environmental matters or other similar contingent
liabilities associated with the property and assets subject to
such sale, lease, transfer or other disposition that are
required to be so provided for under the terms of the
documentation for such sale, lease, transfer or other
disposition;
in each case to the extent, but only to the extent, that the amounts so
deducted are properly attributable to such transaction or to the
property or asset that is the subject thereof and (i
21
in the case of clauses (a) and (c) of this definition, are actually
paid at the time of receipt of such cash to a Person that is not an
Affiliate of such Person or any Loan Party or of any Affiliate of any
Loan Party and (ii) in the case of clauses (b) and (d) of this
definition, are actually paid at the time of receipt of such cash to a
Person that is not an Affiliate of such Person or any Loan Party or of
any Affiliate of any Loan Party or, so long as such Person is not
otherwise indemnified therefor, are reserved for in accordance with
GAAP at the time of receipt of such cash based upon such Person's
reasonable estimate of such taxes or contingent liabilities, as the
case may be; provided, however, that if, at the time such taxes or such
contingent liabilities are actually paid or otherwise satisfied, the
amount of the reserve therefor exceeds the amount paid or otherwise
satisfied, then the Borrower shall reduce the Commitments to the extent
required by Section 2.04(b), and shall prepay the outstanding Working
Capital Advances in accordance with the terms of Section 2.05(b), in an
amount equal to the amount of such excess reserve.
"Notice of Borrowing" has the meaning specified in Section
2.02(a).
"Notice of Conversion" has the meaning specified in Section
2.08(a).
"NPL" means the National Priorities List under CERCLA.
"Obligation" means, with respect to any Person, any payment,
performance or other obligation of such Person of any kind, including,
without limitation, any liability of such Person on any claim, whether
or not the right of any creditor to payment in respect of such claim is
reduced to judgment, liquidated, unliquidated, fixed, contingent,
matured, disputed, undisputed, legal, equitable, secured or unsecured,
and whether or not such claim is discharged, stayed or otherwise
affected by any proceeding referred to in Section 6.01(f). Without
limiting the generality of the foregoing, the Obligations of the Loan
Parties under the Loan Documents include (a) the obligation to pay
principal, interest, charges, expenses, fees, reasonable attorneys'
fees and disbursements, indemnities and other amounts payable by any
Loan Party under any Loan Document and (b) the obligation of any Loan
Party to reimburse any amount in respect of any of the foregoing that
any Lender, in its sole discretion, may elect to pay or advance on
behalf of such Loan Party.
"OECD" means the Organization for Economic Cooperation and
Development.
"Open Year" means, with respect to any Person, any year for
which United States federal income tax returns have been filed by or on
behalf of such Person and for which the expiration of the applicable
statute of limitations for assessment, reassessment or collection has
not occurred (whether by reason of extension or otherwise).
"Other Taxes" has the meaning specified in Section 2.11(b).
22
"PBGC" means the Pension Benefit Guaranty Corporation or any
successor thereto.
"Permitted Acquisition" has the meaning specified in Section
5.02(e)(vii).
"Permitted Disposition"means any sale or other disposition of
assets if (i) such assets were acquired by a Loan Party in a Permitted
Acquisition, (ii) the related Acquisition Certificate delivered by the
Loan Party described such assets in reasonable detail and identified
them as "Permitted Disposition Assets" and (iii) such assets were sold
or otherwise disposed of by such Loan Party no later than twelve months
after the date on which such Permitted Acquisition was consummated.
"Permitted Liens" means such of the following as to which no
enforcement, collection, execution, levy or foreclosure proceeding
shall have been commenced: (a) Liens for taxes, assessments and
governmental charges or levies to the extent not required to be paid
under Section 5.01(b); (b) Liens imposed by law, such as materialmen's,
mechanics', carriers', workmen's and repairmen's Liens and other
similar Liens arising in the ordinary course of business securing
obligations (other than Debt for borrowed money) (i) that are not
overdue for a period of more than 30 days or (ii) the amount,
applicability or validity of which are being contested in good faith
and by appropriate proceedings diligently conducted and with respect to
which the Borrower or any of its Subsidiaries, as the case may be, has
established reserves in accordance with GAAP; (c) pledges or deposits
(i) to secure obligations under workers' compensation laws or similar
legislation (other than in respect of employee benefit plans subject to
ERISA), (ii) to secure public or statutory obligations or (iii) to
secure obligations (other than Debt for borrowed money) in respect of
(A) deductibles, premiums and similar amounts under insurance policies
purchased in the ordinary course of business, (B) payments of rent and
other customary obligations under leases permitted hereunder and (C)
amounts owed to utilities and other service providers in the ordinary
course of business; (d) Liens securing the performance of, or payment
in respect of, bids, tenders, government contracts (other than for the
repayment of borrowed money), surety and appeal bonds and other
obligations of a similar nature incurred in the ordinary course of
business; (e) any interest or title of a lessor or sublessor (including
those arising under or in respect of Capitalized Leases and including
Liens arising from the filing of protective Uniform Commercial Code
financing statements relating solely to the interest or title of a
lessor or sublessor) and any restriction or encumbrance to which the
interest or title of such lessor or sublessor may be subject that is
incurred in the ordinary course of business and, either individually or
when aggregated with all other Permitted Liens in effect on any date of
determination, could not be reasonably expected to have a Material
Adverse Effect; (g) Liens arising out of judgments or awards that do
not constitute an Event of Default under Section 6.01(g) or 6.01(h) and
in respect of which the Borrower or any of its Subsidiaries subject
thereto shall be prosecuting an appeal or proceedings for review in
good faith and, pending such appeal or proceedings, shall have secured
within ten days after the entry thereof a subsisting stay of execution
and shall be maintaining reserves, in accordance with GAAP,
23
with respect to any such judgment or award; (h) easements, rights of
way, zoning restrictions and other encumbrances on title to real
property that were not incurred in connection with and do not secure
Indebtedness and do not, either individually or in the aggregate,
render title to the property encumbered thereby unmarketable or
materially and adversely affect the use of such real property for its
intended purposes and (i) rights of set-off in respect of fees (but not
in respect of Debt for borrowed money) owed to banks and other
financial institutions against deposits of the Loan Parties held by
such banks and other financial institutions in the ordinary course of
business.
"Person" means an individual, partnership, corporation
(including a business trust), limited liability company, unlimited
liability company, joint stock company, trust, unincorporated
association, joint venture or other entity, or a government or any
political subdivision or agency thereof.
"Plan" means a Single Employer Plan or a Multiple Employer
Plan.
"Post-Petition Interest" has the meaning specified in Section
7.06.
"Preferred Interests" means, with respect to any Person,
Equity Interests issued by such Person that are entitled to a
preference or priority over any other Equity Interests issued by such
Person upon any distribution of such Person's property and assets,
whether by dividend or upon liquidation.
"primary obligation" has the meaning specified in the
definition of "Contingent Obligation" set forth in this Section 1.01.
"primary obligor" has the meaning specified in the definition
of "Contingent Obligations" set forth in this Section 1.01.
"Pro Rata Share" of any amount means, with respect to any
Lender at any time, the product of (a) a fraction the numerator of
which is the amount of such Lender's Commitment under the applicable
Facility or Facilities at such time and the denominator of which is the
aggregate amount of such Facility or Facilities at such time multiplied
by (b) such amount.
"Receivables" means has the meaning specified in the Security
Agreement.
"Redeemable" means, with respect to any Equity Interest, Debt
or other right or Obligation, any such Equity Interest, Debt or other
right or Obligation that (a) the issuer has undertaken to redeem at a
fixed or determinable date or dates, whether by operation of a sinking
fund or otherwise, or upon the occurrence of a condition not solely
within the control of the issuer or (b) is redeemable at the option of
the holder.
24
"Register" has the meaning specified in Section 9.07(d).
"Registration Statement" has the meaning specified in Section
3.01(g).
"Regulation U" means Regulation U of the Board of Governors of
the Federal Reserve System, as in effect from time to time.
"Required Lenders" means, at any time, Lenders owed or holding
at least 66-2/3% of the aggregate principal amount of the Working
Capital Advances outstanding at such time, or, if no such principal
amount is outstanding at such time, Lenders holding at least 66-2/3% of
the aggregate of the Working Capital Commitments at such time;
provided, however, that (i) if there are only two (2) Lenders at any
time, Required Lenders shall mean both Lenders and (ii) if any Lender
shall be a Defaulting Lender at such time, there shall be excluded from
the determination of Required Lenders at such time (A) the aggregate
principal amount of the Working Capital Advances owing to such Lender
(in its capacity as a Lender) and outstanding at such time and (B) the
Unused Working Capital Commitment of such Lender at such time.
"Requirements of Law" means, with respect to any Person, all
laws, constitutions, statutes, treaties, ordinances, rules and
regulations, all orders, writs, decrees, injunctions, judgments,
determinations or awards of an arbitrator, a court or any other
Governmental Authority, and all Governmental Authorizations, binding
upon or applicable to such Person or to any of its properties, assets
or businesses.
"Responsible Officer" means, with respect to the Borrower or
any of its Subsidiaries, the chief executive officer, the president,
the chief financial officer, the principal accounting officer or the
treasurer (or the equivalent of any of the foregoing) or any other
officer, partner or member (or person performing similar functions) of
the Borrower or any such Subsidiary responsible for overseeing the
administration of, or reviewing compliance with, all or any portion of
this Agreement or any of the other Loan Documents.
"S&P" means Standard & Poor's, a division of The XxXxxx-Xxxx
Companies, Inc.
"Secured Obligations" has the meaning specified in Section 2
of the Security Agreement.
"Secured Parties" means, collectively, the Agents and the
Lenders.
"Security Agreement" has the meaning specified in Section
3.01(h)(ix).
"Security Agreement Supplement" has the meaning specified in
the Security Agreement.
25
"Single Employer Plan" means a single employer plan (as
defined in Section 4001(a)(15) of ERISA) that (a) is maintained for
employees of any Loan Party or any ERISA Affiliate and no Person other
than the Loan Parties and the ERISA Affiliates or (b) was so maintained
and in respect of which any Loan Party or any ERISA Affiliate could
have liability under Section 4069 of ERISA in the event such plan has
been or were to be terminated.
"Solvent" and "Solvency" mean, with respect to any Person on
any date of determination, that on such date (a) the fair value of the
property of such Person is greater than the total amount of
liabilities, including, without limitation, contingent liabilities, of
such Person, (b) the present fair salable value of the assets of such
Person is not less than the amount that will be required to pay the
probable liability of such Person on its debts as they become absolute
and matured, (c) such Person does not intend to, and does not believe
that it will, incur debts or liabilities beyond such Person's ability
to pay such debts and liabilities as they mature and (d) such Person is
not engaged in business or a transaction, and is not about to engage in
business or a transaction, for which such Person's property would
constitute an unreasonably small capital. The amount of contingent
liabilities at any time shall be computed as the amount that, in the
light of all the facts and circumstances existing at such time,
represents the amount that can reasonably be expected to become an
actual or matured liability.
"Subordinated Obligations" has the meaning specified in
Section 7.06.
"Subsidiary" of any Person means any corporation, partnership,
joint venture, limited liability company, unlimited liability company,
trust or estate of which (or in which) more than 50% of (a) the issued
and outstanding shares of capital stock having ordinary voting power to
elect a majority of the board of directors of such corporation
(irrespective of whether at the time capital stock of any other class
or classes of such corporation shall or might have voting power upon
the occurrence of any contingency), (b) the interest in the capital or
profits of such partnership, joint venture, limited liability company
or unlimited liability company or (c) the beneficial interest in such
trust or estate, is at the time directly or indirectly owned or
controlled by such Person, by such Person and one or more of its other
Subsidiaries or by one or more of such Person's other Subsidiaries.
"Surviving Debt" has the meaning specified in Section 3.01(b).
"Taxes" has the meaning specified in Section 2.11(a).
"Termination Date" means the earlier of (a) January 26, 2002
(or, if such day is not a Business Day, the next preceding Business
Day) and (b) the date of termination in whole of the Working Capital
Commitments pursuant to Section 2.04 or 6.01.
26
"Type" refers to the distinction between Working Capital
Advances bearing interest at the Base Rate and Working Capital Advances
bearing interest at the Eurodollar Rate.
"Underwriters" has the meaning specified in Section 3.01(g).
"Unused Working Capital Commitment" means, with respect to any
Working Capital Lender at any time, (a) such Working Capital Lender's
Working Capital Commitment at such time minus (b) the sum of the
aggregate principal amount of all Working Capital Advances.
"Voting Interests" means shares of capital stock issued by a
corporation, or equivalent Equity Interests in any other Person, the
holders of which are ordinarily, in the absence of contingencies,
entitled to vote for the election of directors (or persons performing
similar functions) of such Person, even if the right so to vote has
been suspended by the happening of such a contingency.
"Welfare Plan" means a welfare plan (as defined in Section
3(1) of ERISA) that is maintained for employees of any Loan Party or in
respect of which any Loan Party could reasonably be expected to have
liability.
"WCAS Funds" means the collective reference to the following
Delaware limited partnerships: (i) Xxxxxxx Xxxxx Capital Partners V,
L.P., (ii) Welsh, Carson, Xxxxxxxx & Xxxxx V, L.P., (iii) Xxxxxxx Xxxxx
Leveraged Capital Fund, Limited Partnership, (iv) Welsh, Carson,
Xxxxxxxx & Xxxxx VI, L.P., (v) WCAS Information Partners, L.P., and
(vi) WCAS Capital Partner II, L.P.
"WCAS Funds Warrants" means the warrants to purchase an
aggregate 84,050 shares of Borrower Common Stock, issued by the
Borrower to the WCAS Funds on October 7, 1998.
"Withdrawal Liability" has the meaning specified in Part I of
Subtitle E of Title IV of ERISA.
"Working Capital Advance" has the meaning specified in Section
2.01.
"Working Capital Borrowing" means a borrowing consisting of
simultaneous Working Capital Advances of the same Type made by the
Working Capital Lenders.
"Working Capital Commitment" means, with respect to any Lender
at any time, the amount set forth opposite such Lender's name on
Schedule I hereto under the caption "Working Capital Commitment" or, if
such Lender has entered into one or more Assignments and Acceptances,
the amount set forth for such Lender in the Register maintained by the
27
Administrative Agent pursuant to Section 9.07(d) as such Lender's
"Working Capital Commitment", as such amount may be reduced at or prior
to such time pursuant to Section 2.04.
"Working Capital Facility" means, at any time, the aggregate
amount of the Working Capital Lenders' Working Capital Commitments at
such time.
"Working Capital Note" means a promissory note of the Borrower
payable to the order of any Lender, in substantially the form of
Exhibit A hereto, evidencing the aggregate indebtedness of the Borrower
to such Lender resulting from the Working Capital Advances made by such
Lender.
"Year 2000 Problem" has the meaning specified in Section
4.01(x).
SECTION 1.02. Computation of Time Periods; Other Definitional
Provisions. In this Agreement in the computation of periods of time from a
specified date to a later specified date, the word "from" means "from and
including" and the words "to" and "until" each means "to but excluding".
References in the Loan Documents to any agreement or contract "as amended" shall
mean and be a reference to such agreement or contract as amended, amended and
restated, supplemented or otherwise modified from time to time in accordance
with its terms.
SECTION 1.03. Accounting Terms. All accounting terms not
specifically defined herein shall be construed in accordance with generally
accepted accounting principles consistent with those applied in the preparation
of the Consolidated financial statements of the Borrower and its Subsidiaries
referred to in Section 4.01(f) ("GAAP").
SECTION 1.04. Currency Equivalents Generally. Any amount
specified in this Agreement (other than in Articles II, VII and VIII) or any of
the other Loan Documents to be in U.S. dollars shall also include the equivalent
of such amount in any currency other than U.S. dollars, such equivalent amount
to be determined at the rate of exchange quoted by NationsBank in Charlotte,
North Carolina at the close of business on the Business Day immediately
preceding any date of determination thereof, to prime banks in New York, New
York for the spot purchase in the New York foreign exchange market of such
amount in U.S. dollars with such other currency.
28
ARTICLE II
AMOUNTS AND TERMS OF THE
WORKING CAPITAL ADVANCES
SECTION 2.01. The Working Capital Advances. Each Lender
severally agrees, on the terms and conditions hereinafter set forth, to make
advances (each a "Working Capital Advance") in U.S. dollars to the Borrower from
time to time on any Business Day during the period from the date hereof until
the Termination Date, in each case in an amount not to exceed the Unused Working
Capital Commitment of such Lender at such time. Each Working Capital Borrowing
shall be in an aggregate amount of $500,000 or an integral multiple of $100,000
in excess thereof or, if less, the amount of the aggregate Unused Working
Capital Commitments at such time. Each Working Capital Borrowing shall consist
of Working Capital Advances made simultaneously by the Lenders in accordance
with their respective Pro Rata Shares of the Working Capital Facility. Within
the limits of each Lender's Unused Working Capital Commitment in effect from
time to time, the Borrower may borrow under this Section 2.01, prepay pursuant
to Section 2.05(a) and reborrow under this Section 2.01.
SECTION 2.02. Making the Working Capital Advances. (a) Except
as otherwise provided in Section 2.02(b) or 2.03 or in respect of any Working
Capital Borrowing requested to be made on the date of the Initial Extension of
Credit, in which case notice will be given on the date of the Initial Extension
of Credit, each Working Capital Borrowing shall be made on notice, given not
later than 11:00 A.M. (Charlotte, North Carolina time) on the third Business Day
prior to the date of the proposed Borrowing in the case of a Borrowing comprised
of Eurodollar Rate Advances, or on the first Business Day prior to the date of
the proposed Borrowing in the case of a Borrowing comprised of Base Rate
Advances, by the Borrower to the Administrative Agent, which shall give prompt
notice thereof to each Lender by telex or telecopier. Each notice of a Working
Capital Borrowing (a "Notice of Borrowing") shall be by telephone, confirmed
immediately in writing, or by telex or telecopier, in substantially the form of
Exhibit B-1 hereto, shall be duly executed by a Responsible Officer of the
Borrower, and shall specify therein: (i) the requested date of such Working
Capital Borrowing (which shall be a Business Day); (ii) the Type of Working
Capital Advances requested to comprise such Working Capital Borrowing; (iii) the
requested aggregate amount of such Working Capital Borrowing; and (iv) in the
case of a Working Capital Borrowing comprised of Eurodollar Rate Advances, the
requested duration of the initial Interest Period for each such Working Capital
Advance. Each Lender shall, before 11:00 A.M. (Charlotte, North Carolina time)
on the date of such Working Capital Borrowing, make available for the account of
its Applicable Lending Office to the Administrative Agent at the Administrative
Agent's Account, in same day funds, such Lender's Pro Rata Share of such Working
Capital Borrowing. After the Administrative Agent's receipt of such funds and
upon fulfillment of the applicable conditions set forth in Article III, the
Administrative Agent will make such funds available to the Borrower by crediting
the Borrower's Account.
29
(b) Anything in subsection (a) of this Section 2.02 to the
contrary notwithstanding, the Borrower may not select Eurodollar Rate Advances
(A) for the initial Working Capital Borrowing hereunder, (B) during the period
from the date of this Agreement to the date that is forty-five (45) days after
such date (or such earlier date as shall be specified in its sole discretion by
the Administrative Agent (in consultation with the Syndication Agent) in a
written notice to the Borrower and the Lenders) or (C) if the obligation of the
Lenders to make Eurodollar Rate Advances shall then be suspended pursuant to
Section 2.08 or 2.09. In addition, the Working Capital Advances may not be
outstanding as part of more than ten (10) separate Working Capital Borrowings.
(c) Each Notice of Borrowing shall be irrevocable and binding
on the Borrower. In the case of any Working Capital Borrowing that the related
Notice of Borrowing specifies is to be comprised of Eurodollar Rate Advances,
the Borrower shall indemnify each Lender against any loss, cost or expense
incurred by such Lender as a result of any failure to fulfill on or before the
date specified in such Notice of Borrowing for such Working Capital Borrowing
the applicable conditions set forth in Article III, including, without
limitation, any loss, cost or expense incurred by reason of the liquidation or
reemployment of deposits or other funds acquired by such Lender to fund the
Working Capital Advance to be made by such Lender as part of such Working
Capital Borrowing when such Working Capital Advance, as a result of such
failure, is not made on such date.
(d) Unless the Administrative Agent shall have received notice
from a Lender prior to the date of any Working Capital Borrowing that such
Lender will not make available to the Administrative Agent such Lender's Pro
Rata Share of such Working Capital Borrowing, the Administrative Agent may
assume that such Lender has made the amount of such Pro Rata Share available to
the Administrative Agent on the date of such Working Capital Borrowing in
accordance with subsection (a) or (b) of this Section 2.02, as applicable, and
the Administrative Agent may, in reliance upon such assumption, make available
to the Borrower on such date a corresponding amount. If and to the extent that
such Lender shall not have so made the amount of such Pro Rata Share available
to the Administrative Agent, such Lender and the Borrower severally agree to
repay or to pay to the Administrative Agent forthwith on demand such
corresponding amount, together with interest thereon, for each day from the date
such amount is made available to the Borrower until the date such amount is
repaid or paid to the Administrative Agent, at (i) in the case of the Borrower,
the interest rate applicable at such time under Section 2.06 to Working Capital
Advances comprising such Working Capital Borrowing and (ii) in the case of such
Lender, the Federal Funds Rate. If such Lender shall pay to the Administrative
Agent such corresponding amount, such amount so paid shall constitute such
Lender's Working Capital Advance as part of such Working Capital Borrowing for
all purposes under this Agreement.
(e) The failure of any Lender to make the Working Capital
Advance to be made by it as part of any Working Capital Borrowing shall not
relieve any other Lender of its obligation, if any, hereunder to make its
Working Capital Advance on the date of such Working Capital Borrowing, but no
Lender shall be responsible for the failure of any other Lender to make the
30
Working Capital Advance to be made by such other Lender on the date of any
Working Capital Borrowing.
SECTION 2.03. Repayment of Working Capital Advances. The
Borrower shall repay to the Administrative Agent for the ratable account of the
Lenders on the Termination Date the aggregate principal amount of all Working
Capital Advances outstanding on such date.
SECTION 2.04. Termination or Reduction of the Commitments. (a)
Optional. The Borrower may, upon at least five Business Days' notice to the
Administrative Agent, terminate in whole or reduce in part the Unused Working
Capital Commitments; provided, however, that (i) each partial reduction of the
Working Capital Facility shall be in an aggregate amount of $500,000 or an
integral multiple of $100,000 in excess thereof or, if less, the aggregate
amount of the Working Capital Facility and (ii) in no event shall the aggregate
amount of the Working Capital Facility be reduced below $10,000,000 as a result
of any such partial reduction.
(b) Mandatory. The Working Capital Facility shall be
automatically and permanently reduced on each date on which the prepayment of
Working Capital Advances outstanding thereunder is required to be made pursuant
to clause (A), (B) or (D) of Section 2.05(b)(i) by an amount equal to the amount
required to be so prepaid; provided, however, that notwithstanding the foregoing
provisions of this Section 2.04(b), in no event shall the Working Capital
Facility be reduced, pursuant to this Section 2.04(b), to less than $10,000,000,
and (ii) the Working Capital Facility shall not be reduced by the amount of any
such required prepayments of the Working Capital Advances pursuant to clause (A)
of Section 2.05(b)(i) (each, an "Asset Sale Prepayment") (A) to the extent that
the aggregate amount of all Asset Sale Prepayments made during the most recent
twelve month period ending on any date of determination does not exceed
$1,000,000 and (B) if the Asset Sale Prepayment occurred as a result of a
Permitted Disposition.
(c) Application of Commitment Reductions. Upon each reduction
of the Working Capital Facility pursuant to this Section 2.04, the Working
Capital Commitment of each Lender shall be reduced by such Lender's Pro Rata
Share of the amount by which the Working Capital Facility is reduced. .
SECTION 2.05. Prepayments. (a) Optional. The Borrower may,
upon at least one Business Day's notice in the case of Base Rate Advances and
three Business Days' notice in the case of Eurodollar Rate Advances, in each
case to the Administrative Agent stating the proposed date and aggregate
principal amount of the prepayment, and if such notice is given the Borrower
shall, prepay the aggregate principal amount of the Working Capital Advances
comprising part of the same Working Capital Borrowing and outstanding on such
date, in whole or ratably in part; provided, however, that (i) each partial
prepayment shall be in an aggregate principal amount of $500,000 or an integral
multiple of $100,000 in excess thereof and (ii) no such prepayment of a
Eurodollar Rate Advance shall be made other than on the last day of an Interest
Period therefor.
31
(b) Mandatory.
(i) The Borrower shall, on the date of receipt of the Net Cash
Proceeds by any Loan Party from (A) the sale, lease, transfer or other
disposition of any property or assets of any Loan Party (other than any property
or assets expressly permitted to be sold, leased, transferred or otherwise
disposed of pursuant to clause (i) of Section 5.02(d)), (B) the incurrence or
issuance by any Loan Party of any Debt (other than Debt expressly permitted to
be incurred or issued pursuant to clause (i) or (ii) of Section 5.02(b)), (C)
the issuance or sale by any Loan Party of any Equity Interests therein (other
than (i) the issuance and sale of Borrower Common Stock in connection with the
Initial Public Offering (including, without limitation, Borrower Common Stock
issued and sold (A) pursuant to the over-allotment arrangements with the
Underwriters described in the Registration Statement, and (B) in consideration
for the release of accrued and unpaid dividends on the Borrower's preferred
stock (as described in the Registration Statement), (ii) the issuance and sale
of Borrower Common Stock pursuant to the Medic Warrant and the WCAS Funds
Warrants, (iii) Equity Interests in the Borrower expressly permitted to be
issued or sold pursuant to clause (i) of Section 5.02(f) and (iv) the issuance
and sale of Borrower Common Stock, or options to purchase Borrower Common Stock,
in each case pursuant employee stock option or stock purchase plans) and
(D) any Extraordinary Receipt received by or paid to or for the account of any
Loan Party and not otherwise included in subclause (i)(A), (i)(B) or (i)(C) of
this Section 2.05(b), prepay an aggregate principal amount of the Working
Capital Advances comprising part of the same Borrowings equal to (x) in case of
subclauses (i)(A), (i)(B) and (i)(D) of this Section 2.05(b), 100% of the amount
of such Net Cash Proceeds and (y) in the subclause (i)(C) of this Section
2.05(b), 50% of such Net Cash Proceeds.
(ii) The Borrower shall, on each Business Day, prepay an
aggregate principal amount of the Working Capital Advances comprising part of
the same Working Capital Borrowings equal to the amount by which (A) the sum of
the aggregate principal amount of all Working Capital Advances outstanding on
such Business Day exceeds (B) the Working Capital Facility on such Business Day
(after giving effect to any permanent reduction thereof pursuant to Section 2.04
on such Business Day).
(c) Prepayments to Include Accrued Interest, Etc. All
prepayments under this Section 2.05 shall be made together with (i) accrued and
unpaid interest to the date of such prepayment on the principal amount so
prepaid and (ii) in the case of any such prepayment of a Eurodollar Rate Advance
on a date other than the last day of an Interest Period therefor, any amounts
owing in respect of such Eurodollar Rate Advance pursuant to 9.04(c). Upon the
occurrence of a Default, the Administrative Agent shall also be authorized
(without any further action by or notice to or from the Borrower or any other
Loan Party) to apply such amount to the prepayment of the outstanding Working
Capital Advances in accordance with this Section 2.05(b).
SECTION 2.06. Interest. (a) Scheduled Interest. The Borrower
shall pay interest on the unpaid principal amount of each Working Capital
Advance owing to each Lender from the
32 date of such Working Capital Advance until such principal amount shall be
paid in full, at the following rates per annum:
(i) Base Rate Advances. During such periods as such Working
Capital Advance is a Base Rate Advance, a rate per annum equal at all
times to the sum of (A) the Base Rate in effect from time to time and
(B) the Applicable Margin for such Working Capital Advance, payable in
arrears quarterly on the Business Day of each March, June, September
and December during such periods and on the date such Base Rate Advance
shall be Converted or paid in full.
(ii) Eurodollar Rate Advances. During such periods as such
Working Capital Advance is a Eurodollar Rate Advance, a rate per annum
equal at all times during each Interest Period for such Working Capital
Advance to the sum of (A) the Eurodollar Rate for such Working Capital
Advance for such Interest Period and (B) the Applicable Margin for such
Working Capital Advance, payable in arrears on the last day of such
Interest Period and, if such Interest Period has a duration of more
than three months, on each day that occurs during such Interest Period
every three months from the first day of such Interest Period and on
the date such Eurodollar Rate Advance shall be Converted or paid in
full.
(b) Default Interest. Upon the occurrence and during the
continuance of a Default, the Borrower shall pay interest on (i) the unpaid
principal amount of each Working Capital Advance owing to each Lender, payable
in arrears on the dates referred to in clause (i) or (ii) of Section 2.06(a), as
applicable, and on demand, at a rate per annum equal at all times to 2% per
annum above the rate per annum required to be paid on such Working Capital
Advance pursuant to clause (i) or (ii) of Section 2.06(a), as applicable, and
(ii) to the fullest extent permitted by applicable law, the amount of any
interest, fee or other amount payable under this Agreement or any other Loan
Document to any Agent or any Lender that is not paid when due, from the date
such amount shall be due until such amount shall be paid in full, payable in
arrears on the date such amount shall be paid in full and on demand, at a rate
per annum equal at all times to 2% per annum above the rate per annum required
to be paid, in the case of interest, on the Type of Working Capital Advance on
which such interest has accrued pursuant to clause (i) or (ii) of Section
2.06(a), as applicable, and, in all other cases, on Base Rate Advances pursuant
to clause (i) of Section 2.06(a).
(c) Notice of Interest Rate. Promptly after receipt of a
Notice of Borrowing pursuant to Section 2.02(a), the Administrative Agent shall
give notice to the Borrower and each Lender of the applicable interest rate
determined by the Administrative Agent for purposes of clause (i) or (ii) of
Section 2.06(a), as applicable.
SECTION 2.07. Fees. (a) Commitment Fee. The Borrower shall pay
to the Administrative Agent for the account of the Lenders a commitment fee (the
"Commitment Fee"), from the date hereof in the case of each Initial Lender and
from the effective date specified in the Assignment and Acceptance pursuant to
which it became a Lender in the case of each other Lender
33
until, in each case, the Termination Date, payable in arrears quarterly on the
last Business Day of each March, June, September and December, and on the
Termination Date, at the rate of 0.50% per annum on the average daily Unused
Working Capital Commitment of each Working Capital Lender; provided, however,
that any Commitment Fee accrued with respect to any of the Working Capital
Commitments of a Defaulting Lender during the period prior to the time such
Lender became a Defaulting Lender and unpaid at such time shall not be payable
by the Borrower so long as such Lender shall be a Defaulting Lender except to
the extent that such Commitment Fee shall otherwise have been due and payable by
the Borrower prior to such time; and provided further that no Commitment Fee
shall accrue on any of the Working Capital Commitments of a Defaulting Lender so
long as such Lender shall be a Defaulting Lender.
(b) Agents' Fees. The Borrower shall pay to the Administrative
Agent for the account of the Agents such fees as may from time to time be agreed
between the Borrower and the Administrative Agent.
SECTION 2.08. Conversion of Working Capital Advances. (a)
Optional. The Borrower may on any Business Day, upon notice given to the
Administrative Agent not later than 11:00 A.M. (Charlotte, North Carolina time)
on the third Business Day prior to the date of the proposed Conversion and
subject to the provisions of Section 2.09, Convert all or any portion of the
Working Capital Advances of one Type comprising the same Borrowing into Working
Capital Advances of the other Type; provided, however, that:
(i) any Conversion of Eurodollar Rate Advances into Base Rate
Advances shall be made only on the last day of an Interest Period for
such Eurodollar Rate Advances;
(ii) any Conversion of Base Rate Advances into Eurodollar Rate
Advances shall be made only if no Default shall have occurred and be
continuing and shall be in an amount not less than $1,000,000 or an
integral multiple of $1,000,000 in excess thereof;
(iii) no Conversion of any Working Capital Advances shall
result in more separate Working Capital Borrowings than permitted under
Section 2.02(b); and
(iv) each Conversion of Working Capital Advances comprising
part of the same Working Capital Borrowing under any Facility shall be
made among the Lenders in accordance with their respective Pro Rata
Shares of such Working Capital Borrowing.
Each notice of a Conversion (a "Notice of Conversion") shall be delivered by
telephone, confirmed immediately in writing, or by telex or telecopier, in
substantially the form of Exhibit B-2 hereto, shall be duly executed by a
Responsible Officer of the Borrower, and shall, within the restrictions set
forth in the immediately preceding sentence, specify therein:
(A) the requested date of such Conversion (which shall be a
Business Day);
34
(B) the Working Capital Advances requested to be Converted;
and
(C) if such Conversion is into Eurodollar Rate Advances, the
requested duration of the Interest Period for such Eurodollar Rate
Advances.
The Administrative Agent shall give each of the Lenders prompt notice of each
Notice of Conversion received by it, by telex or telecopier. Each Notice of
Conversion shall be irrevocable and binding on the Borrower.
(b) Mandatory. (i) On the date on which the aggregate unpaid
principal amount of Eurodollar Rate Advances comprising any Working Capital
Borrowing shall be reduced, by payment or prepayment or otherwise, to less than
$500,000, such Working Capital Advances shall automatically Convert into Base
Rate Advances.
(ii) If the Borrower shall fail to select the duration of any
Interest Period for any Eurodollar Rate Advances in accordance with the
provisions contained in the definition of "Interest Period" set forth in Section
1.01, the Administrative Agent will forthwith so notify the Borrower and the
Lenders, whereupon each such Eurodollar Rate Advance will automatically, on the
last day of the then existing Interest Period therefor, Convert into a Base Rate
Advance.
(iii) Upon the occurrence and during the continuance of any
Event of Default, (A) each Eurodollar Rate Advance will automatically, on the
last day of the then existing Interest Period therefor, Convert into a Base Rate
Advance and (B) the obligation of the Lenders to make, or to Convert Base Rate
Advances into, Eurodollar Rate Advances shall be suspended.
SECTION 2.09. Increased Costs, Etc. (a) If, due to either (i)
the introduction of or any change (other than any change by way of the
imposition of or increase in reserve requirements included in the Eurodollar
Rate Reserve Percentage) in or in the interpretation or application of any
Requirement of Law after the date of this Agreement or (ii) the compliance with
any directive, guideline or request from any central bank or other Governmental
Authority or any change therein or in the interpretation, application,
implementation, administration or enforcement thereof, that, in any case under
this clause (ii), becomes effective or is issued or made after the date of this
Agreement (whether or not having the force of law), there shall be any increase
in the cost to any of the Lenders of agreeing to make or making, agreeing to
participate in or participating in, agreeing to renew or renewing or funding or
maintaining any Working Capital Advances of either Type, or any reduction in the
amount owing to any of the Lenders or their respective Applicable Lending
Offices under this Agreement in respect of any Working Capital Advances of
either Type (excluding, for purposes of this Section 2.09, any such increased
costs resulting from (A) Taxes or Other Taxes (as to which Section 2.11 shall
govern), and (B) changes in the basis of taxation of overall net income or
overall gross income by the United States of America or the jurisdiction under
the laws of which such Lender is organized or has either of its Applicable
Lending Offices or any political subdivision thereof), then the Borrower hereby
agrees to pay, from time to time upon demand by
35
such Lender (with a copy of such demand to the Administrative Agent), to the
Administrative Agent for the account of such Lender additional amounts
sufficient to compensate or to reimburse such Lender for all such increased
costs or reduced amounts. A certificate of the Lender requesting such additional
compensation pursuant to this Section 2.09(a), submitted to the Borrower by such
Lender and specifying therein the amount of such additional compensation, shall
be conclusive and binding for all purposes, absent manifest error. In
determining any such additional compensation, such Lender may use reasonable
averaging and attribution methods. If any of the Lenders requests additional
compensation from the Borrower under this subsection (a) in respect of its
making, participating in or renewing Eurodollar Rate Advances, the Borrower may,
upon notice to such Lender (with a copy of such notice to the Administrative
Agent), suspend the obligation of such Lender to make, participate in and/or
renew Eurodollar Rate Advances until the circumstances giving rise to such
request no longer exist and, during such time, all Eurodollar Rate Advances that
would otherwise be made by such Lender as part of any Working Capital Borrowing
shall be made instead as Base Rate Advances and all payments of principal of and
interest on such Base Rate Advances shall be made at the same time as payments
on the Eurodollar Rate Advances otherwise comprising part of such Working
Capital Borrowing.
(b) If any of the Lenders determines that compliance with any
Requirement of Law or any directive, guideline or request from any central bank
or other Governmental Authority (whether or not having the force of law), or any
change therein or in the interpretation, application, implementation,
administration or enforcement thereof, that is enacted or becomes effective, or
is implemented or is first required or expected to be complied with, after the
date of this Agreement affects the amount of capital required or expected to be
maintained by such Lender (or either of the Applicable Lending Offices of such
Lender) or by any Person controlling such Lender and that the amount of such
capital is increased by or is based upon the existence of the commitment of such
Lender to lend hereunder and other commitments of such type, then the Borrower
hereby agrees to pay, upon demand by such Lender (with a copy of such demand to
the Administrative Agent), to the Administrative Agent for the account of such
Lender, from time to time as specified by such Lender, additional amounts
sufficient to compensate such Lender or such Person in light of such
circumstances, to the extent that such Lender or such Person reasonably
determines such increase in capital to be allocable to the existence of the
commitment of such Lender to lend hereunder. A certificate of the Lender
requesting such additional compensation pursuant to this subsection (b),
submitted to the Borrower by such Lender and specifying therein the amount of
such additional compensation, shall be conclusive and binding for all purposes,
absent manifest error. In determining any such additional compensation, such
Lender may use reasonable averaging and attribution methods.
(c) If, with respect to any Eurodollar Rate Advances under the
Working Capital Facility, Lenders owed or holding not less than a majority in
interest of the aggregate principal amount of all Working Capital Advances
outstanding at any time notify the Administrative Agent that the Eurodollar Rate
for any Interest Period for such Working Capital Advances will not adequately
reflect the cost to such Lenders of making, participating in or renewing, or
funding or
36
maintaining, their Eurodollar Rate Advances for such Interest Period, the
Administrative Agent shall forthwith so notify the Borrower and the Lenders,
whereupon (i) each such Eurodollar Rate Advance will automatically, on the last
day of the then existing Interest Period therefor, Convert into a Base Rate
Advance and (ii) the obligation of the Lenders to make, or to Convert Working
Capital Advances into, Eurodollar Rate Advances shall be suspended until the
Administrative Agent shall notify the Borrower (promptly following notice from
the Lenders) that such Lenders have determined that the circumstances causing
such suspension no longer exist.
(d) Notwithstanding any other provision of this Agreement, if
the introduction of or any change in or in the interpretation of any law or
regulation shall make it unlawful, or any central bank or other Governmental
Authority shall assert that it is unlawful, for any Lender or its Eurodollar
Lending Office to perform its obligations hereunder to make Eurodollar Rate
Advances or to continue to fund or maintain Eurodollar Rate Advances hereunder,
then, upon notice thereof and demand therefor by such Lender to the Borrower
through the Administrative Agent, (i) each Eurodollar Rate Advance of such
Lender will automatically, on the last day of the then existing Interest Period
therefor, if permitted by applicable law, or otherwise upon demand Convert into
a Base Rate Advance and (ii) the obligation of the Lenders to make, or to
Convert Working Capital Advances into, Eurodollar Rate Advances shall be
suspended until the Administrative Agent shall notify the Borrower that such
Lender has determined that the circumstances causing such suspension no longer
exist. If the obligation of a Lender to make Eurodollar Rate Advances is
suspended pursuant to this subsection (d), then until the circumstances that
gave rise to such suspension no longer apply to such Lender, all Eurodollar Rate
Advances that would otherwise be made by such Lender as part of any Working
Capital Borrowing shall be made instead as Base Rate Advances and all payments
of principal of and interest on such Base Rate Advances shall be made at the
same time as payments on the Eurodollar Rate Advances otherwise comprising part
of such Working Capital Borrowing.
(e) Each of the Lenders hereby agrees that, upon the
occurrence of any circumstances entitling such Lender to additional compensation
or to cease making, participating in or renewing, or funding or maintaining,
Eurodollar Rate Advances under any of the foregoing provisions of this Section
2.09, such Lender shall use reasonable efforts (consistent with its internal
policy and with legal and regulatory restrictions) to designate a different
Applicable Lending Office for any Advances affected by such circumstances if the
making of such designation, in the case of subsection (a) or (b) of this Section
2.09, would avoid the need for, or reduce the amount of, any such additional
amounts that may thereafter accrue or, in the case of subsection (c) or (d) of
this Section 2.09, would allow such Lender to continue to perform its
obligations make, to participate in or renew, or to fund or maintain, Eurodollar
Rate Advances, and, in any such case, would not, in the reasonable judgment of
such Lender, be otherwise disadvantageous to such Lender.
(f) If any of the Lenders entitled to additional compensation
under any of the foregoing provisions of this Section 2.09 shall fail to
designate a different Applicable Lending Office as provided in subsection (e) of
this Section 2.09 or if the inadequacy or illegality contemplated
37
under subsection (c) or (d) of this Section 2.09, respectively, shall continue
with respect to such Lender notwithstanding such designation, then, subject to
the terms of Section 9.07(a), the Borrower may cause such Lender to (and, if the
Borrower so demands, such Lender shall) assign all of its rights and obligations
under this Agreement in accordance with Section 9.07(a); provided that if, upon
such demand by the Borrower, such Lender elects to waive its request for
additional compensation pursuant to Section 2.09(a) or 2.09(b), the demand by
the Borrower for such Lender to so assign all of its rights and obligations
under the Agreement shall thereupon be deemed withdrawn. Nothing in subsection
(e) of this Section 2.09 or this subsection (f) shall affect or postpone any of
the rights of any of the Lenders or any of the Obligations of the Borrower under
any of the foregoing provisions of this Section 2.09 in any manner.
(g) Each Lender requesting compensation under any of the
foregoing provisions of this Section 2.09 shall submit to the Administrative
Agent and the Borrower a certificate setting forth in reasonable detail the
calculations of such compensation, and such certificate shall be conclusive and
binding (in the absence of manifest error).
SECTION 2.10. January 23, 1999 Payments and Computations. (a)
The Borrower shall make each payment hereunder and under the Working Capital
Notes, irrespective of any right of counterclaim or set-off (except as otherwise
provided in Section 2.14), not later than 11:00 A.M. (Charlotte, North Carolina
time) on the day when due in U.S. dollars to the Administrative Agent at the
Administrative Agent's Account in same day funds, with payments received by the
Administrative Agent after such time being deemed to have been received on the
next succeeding Business Day. The Administrative Agent will promptly thereafter
cause like funds to be distributed (i) if such payment by the Borrower is in
respect of principal, interest, commitment fees or any other Obligation then
payable hereunder and under the Working Capital Notes to more than one Lender,
to such Lenders for the accounts of their respective Applicable Lending Offices
in accordance with their respective Pro Rata Shares of the amounts of such
respective Obligations payable to such Lenders at such time and (ii) if such
payment by the Borrower is in respect of any Obligation then payable hereunder
solely to one Lender, to such Lender for the account of its Applicable Lending
Office, in each case to be applied in accordance with the terms of this
Agreement. Upon its acceptance of an Assignment and Acceptance and recording of
the information contained therein in the Register pursuant to Section 9.07(d),
from and after the effective date of such Assignment and Acceptance, the
Administrative Agent shall make all payments hereunder and under the Working
Capital Notes in respect of the interest assigned thereby to the Lender assignee
thereunder, and the parties to such Assignment and Acceptance shall make all
appropriate adjustments in such payments for periods prior to such effective
date directly between themselves.
(b) The Borrower hereby authorizes each Lender, if and to the
extent payment owed to such Lender is not made when due hereunder or, in the
case of a Lender, under the Working Capital Note held by such Lender, to charge
from time to time against any or all of the Borrower's accounts with such Lender
any amount so due.
38
(c) All computations of (i) interest in respect of Eurodollar
Rate Advances shall be made by the Administrative Agent on the basis of a year
of 360 days and (ii) interest in respect of Base Rate Advances and fees shall be
made by the Administrative Agent on the basis of a year of 365 (or 366) days, as
the case may be, in each case for the actual number of days (including the first
day but excluding the last day) occurring in the period for which such interest
or fees are payable. Each determination by the Administrative Agent of an
interest rate or fee hereunder shall be conclusive and binding for all purposes,
absent manifest error.
(d) Whenever any payment hereunder or under the Working
Capital Notes shall be stated to be due on a day other than a Business Day, such
payment shall be made on the next succeeding Business Day, and such extension of
time shall in such case be included in the computation of payment of interest or
Commitment Fees, as the case may be; provided, however, that, if such extension
would cause payment of interest on or principal of Eurodollar Rate Advances to
be made in the next succeeding calendar month, such payment shall be made on the
immediately preceding Business Day.
(e) Unless the Administrative Agent shall have received notice
from the Borrower prior to the date on which any payment is due to any Lender
hereunder that the Borrower will not make such payment in full, the
Administrative Agent may assume that the Borrower has made such payment in full
to the Administrative Agent on such date and the Administrative Agent may, in
reliance upon such assumption, cause to be distributed to each such Lender on
such due date an amount equal to the amount due such Lender on such date. If and
to the extent the Borrower shall not have so made such payment in full to the
Administrative Agent, each such Lender shall repay to the Administrative Agent
forthwith on demand such amount distributed to such Lender, together with
interest thereon, for each day from the date such amount is distributed to such
Lender until the date such Lender repays such amount to the Administrative
Agent, at the Federal Funds Rate.
(f) Whenever any payment received by the Administrative Agent
under this Agreement or any of the other Loan Documents is insufficient to pay
in full all amounts due and payable to the Agents and the Lenders under or in
respect of this Agreement and the other Loan Documents on any date, such payment
shall be distributed by the Administrative Agent and applied by the Agents and
the Lenders in the following order of priority:
(i) first, to the payment of all of the fees, indemnification
payments, costs and expenses that are due and payable to the Agents
(solely in their respective capacities as Agents) under or in respect
of this Agreement or any of the other Loan Documents on such date,
ratably based upon the respective aggregate amounts of all such fees,
indemnification payments, costs and expenses owing to the Agents on
such date;
(ii) second, to the payment of all of the indemnification
payments, costs and expenses that are due and payable to the Lenders
under Section 9.04 hereof, Section 7.01 of the Guaranty, Section 20 of
the Security Agreement or similar section of any of the other
39
Loan Documents on such date, ratably based upon the respective
aggregate amounts of all such indemnification payments, costs and
expenses owing to the Lenders on such date;
(iii) third, to the payment of all of the amounts that are due
and payable to the Administrative Agent and the Lenders under Sections
2.09 and 2.11 hereof or Section 7.01 of the Guaranty on such date,
ratably based upon the respective aggregate amounts thereof owing to
the Administrative Agent and the Lenders on such date;
(iv) fourth, to the payment of all of the fees that are due
and payable to the Lenders under Section 2.07(a) on such date, ratably
based upon the respective aggregate Working Capital Commitments of the
Lenders on such date;
(v) fifth, to the payment of all of the accrued and unpaid
interest on the Obligations of the Borrower under or in respect of the
Loan Documents that is due and payable to the Administrative Agent and
the Lenders under Section 2.06(b) on such date, ratably based upon the
respective aggregate amounts of all such interest owing to the
Administrative Agent and the Lenders on such date;
(vi) sixth, to the payment of all of the accrued and unpaid
interest on the Working Capital Advances that is due and payable to the
Administrative Agent and the Lenders under Section 2.06(a) on such
date, ratably based upon the respective aggregate amounts of all such
interest owing to the Administrative Agent and the Lenders on such
date;
(vii) seventh, to the payment of the principal amount of all
of the outstanding Working Capital Advances that is due and payable to
the Administrative Agent and the Lenders on such date, ratably based
upon the respective aggregate amounts of all such principal owing to
the Administrative Agent and the Lenders on such date; and
(viii) eighth, to the payment of all other Obligations of the
Loan Parties owing under or in respect of the Loan Documents that are
due and payable to the Administrative Agent and the other Secured
Parties on such date, ratably based upon the respective aggregate
amounts of all such Obligations owing to the Administrative Agent and
the other Secured Parties on such date.
If the Administrative Agent receives funds for application to the Obligations of
the Loan Parties under or in respect of the Loan Documents under circumstances
for which the Loan Documents do not specify the Working Capital Advances or the
Facility to which, or the manner in which, such funds are to be applied, the
Administrative Agent may, but shall not be obligated to, elect to distribute
such funds to each of the Lenders in accordance with such Lender's Pro Rata
Share of the aggregate principal amount of all Working Capital Advances
outstanding at such time in repayment or prepayment of such of the outstanding
Working Capital Advances or other Obligations then owing to such Lender.
40
SECTION 2.11. Taxes. (a) Any and all payments by the Loan
Parties hereunder or under the Working Capital Notes shall be made, in
accordance with Section 2.10, free and clear of and without deduction for any
and all present or future taxes, levies, imposts, deductions, charges or
withholdings, and all liabilities with respect thereto, excluding, in the case
of each Lender and each Agent, taxes that are imposed on its overall net income
by the United States and taxes that are imposed on its overall net income (and
franchise taxes imposed in lieu thereof) by the state or foreign jurisdiction
under the laws of which such Lender or such Agent, as the case may be, is
organized or is a resident, or has a fixed place of business or a permanent
establishment, or any political subdivision of any of the foregoing, and, in the
case of each Lender, taxes that are imposed on its overall net income (and
franchise taxes imposed in lieu thereof) by the state or foreign jurisdiction of
either of its Applicable Lending Offices or any political subdivision thereof
(all such nonexcluded taxes, levies, imposts, deductions, charges, withholdings
and liabilities in respect of payments hereunder or under the Working Capital
Notes being, collectively, "Taxes"). If any Loan Party shall be required under
applicable Requirements of Law to deduct any Taxes from or in respect of any sum
payable hereunder or under any Working Capital Note to any Lender or any Agent,
(i) the sum payable by such Loan Party shall be increased as may be necessary so
that after such Loan Party and the Administrative Agent have made all required
deductions (including deductions applicable to additional sums payable under
this Section 2.11) such Lender or such Agent, as the case may be, receives an
amount equal to the sum it would have received had no such deductions been made,
(ii) such Loan Party shall make such deductions and (iii) such Loan Party shall
pay the full amount deducted to the relevant taxation authority or other
Governmental Authority in accordance with applicable Requirements of Law.
(b) In addition, each Loan Party shall pay any present or
future stamp, recording, documentary, excise, property or similar taxes, charges
or levies that arise from any payment made hereunder or under the Working
Capital Notes or from the execution, delivery or registration of, any
performance under, or otherwise with respect to, this Agreement or the Working
Capital Notes (collectively, "Other Taxes").
(c) Each Loan Party shall indemnify each Lender and each Agent
for the full amount of Taxes and Other Taxes, and for the full amount of taxes
of any kind imposed by any jurisdiction on amounts payable under this Section
2.11, imposed on or paid by such Lender or such Agent, as the case may be, and
any liability (including penalties, additions to tax, interest and expenses)
arising therefrom or with respect thereto. The indemnity by the Loan Parties
provided for in this subsection (c) shall apply and be made whether or not the
Taxes or Other Taxes for which indemnification hereunder is sought have been
correctly or legally asserted; provided, however, that such Lender or such Agent
seeking such indemnification shall take all reasonable actions (consistent with
its internal policy and legal and regulatory restrictions) requested by such
Loan Party to assist such Loan Party in recovering the amounts paid thereby
pursuant to this subsection (c) from the relevant taxation authority or other
Governmental Authority. Amounts payable by the Loan Parties under the indemnity
set forth in this subsection (c) shall be paid within 30 days from the date on
which the applicable Lender or Agent, as the case may be, makes written demand
therefor.
41
(d) Within 30 days after the date of any payment of Taxes, the
Loan Parties shall furnish to the Administrative Agent, at its address referred
to in Section 9.02, the original or a certified copy of a receipt evidencing
payment thereof, to the extent such a receipt is issued therefor, or other
written proof of payment thereof that is reasonably satisfactory to the
Administrative Agent. In the case of any payment hereunder or under the Working
Capital Notes by or on behalf of any Loan Party through an account or branch
outside the United States, or on behalf of any Loan Party by a payor that is not
a United States person, if such Loan Party determines that no Taxes are payable
in respect thereof, such Loan Party shall furnish, or shall cause such payor to
furnish, to the Administrative Agent, at its address referred to in Section
9.02, an opinion of counsel reasonably acceptable to the Administrative Agent
stating that such payment is exempt from Taxes. For purposes of this subsection
(d) and subsection (e) of this Section 2.11, the terms "United States" and
"United States person" shall have the meanings specified in Section 7701 of the
Internal Revenue Code.
(e) Each Lender organized under the laws of a jurisdiction
outside the United States shall, on or prior to the date of its execution and
delivery of this Agreement in the case of each Initial Lender, and on the date
of the Assignment and Acceptance pursuant to which it becomes a Lender in the
case of each other Lender, and from time to time thereafter as reasonably
requested in writing by any Loan Party (but only so long thereafter as such
Lender remains lawfully able to do so), provide each of the Administrative Agent
and such Loan Party with two original Internal Revenue Service forms 1001 or
4224, or any successor or other form prescribed by the Internal Revenue Service,
certifying that such Lender is exempt from or entitled to a reduced rate of
United States withholding tax on payments pursuant to this Agreement or the
Working Capital Notes. If the forms provided by a Lender at the time such Lender
first becomes a party to this Agreement indicate a United States interest
withholding tax rate in excess of zero, withholding tax at such rate shall be
considered excluded from Taxes unless and until such Lender provides the
appropriate forms certifying that a lesser rate applies, whereupon withholding
tax at such lesser rate only shall be considered excluded from Taxes for periods
governed by such forms; provided, however, that, if at the date of the
Assignment and Acceptance pursuant to which a Lender becomes a party to this
Agreement, the Lender assignor was entitled to payments under subsection (a) of
this Section 2.11 in respect of United States withholding tax with respect to
interest paid at such date, then, to such extent, the term Taxes shall include
(in addition to withholding taxes that may be imposed in the future or other
amounts otherwise includable in Taxes) United States withholding tax, if any,
applicable with respect to the Lender assignee on such date. If any form or
document referred to in this subsection (e) requires the disclosure of
information, other than information necessary to compute the tax payable and
information required on the date hereof by Internal Revenue Service form 1001 or
4224, that the Lender reasonably considers to be confidential, the Lender shall
give notice thereof to the Loan Parties and shall not be obligated to include in
such form or document such confidential information.
(f) For any period with respect to which a Lender has failed
to provide the Loan Parties with the appropriate form, certificate or other
document described in subsection (e) of this
42
Section 2.11 (other than if such failure is due to a change in the applicable
Requirements of Law, or in the interpretation or application thereof, occurring
after the date on which a form, certificate or other document originally was
required to be provided or if such form, certificate or other document otherwise
is not required under subsection (e) of this Section 2.11), such Lender shall
not be entitled to indemnification under subsection (a) or (c) of this Section
2.11 with respect to Taxes imposed by the United States by reason of such
failure; provided, however, that should a Lender become subject to Taxes because
of its failure to deliver a form, certificate or other document required
hereunder, the Loan Parties shall take such steps as such Lender shall
reasonably request to assist such Lender in recovering such Taxes.
(g) Each of the Lenders hereby agrees that, upon the
occurrence of any circumstances entitling such Lender to additional amounts
pursuant to this Section 2.11, such Lender shall use reasonable efforts
(consistent with its internal policy and legal and regulatory restrictions) to
designate a different Applicable Lending Office if the making of such a change
would avoid the need for, or reduce the amount of any such additional amounts
that may thereafter accrue and would not, in the reasonable judgment of such
Lender, be otherwise disadvantageous to such Lender.
(h) If any of the Lenders entitled to additional compensation
under any of the foregoing provisions of this Section 2.11 shall fail to
designate a different Applicable Lending Office as provided in subsection (g) of
this Section 2.11, then, subject to the terms of Section 9.07(a), the Borrower
may cause such Lender to (and, if the Borrower so demands, such Lender shall)
assign all of its rights and obligations under this Agreement in accordance with
Section 9.07(a); provided that if, upon such demand by the Borrower, such Lender
elects to waive its request for additional compensation pursuant to this Section
2.11, the demand by the Borrower for such Lender to so assign all of its rights
and obligations under the Agreement shall thereupon be deemed withdrawn. Nothing
in subsection (g) of this Section 2.11 or this Section 2.11(h) shall affect or
postpone any of the rights of any of the Lenders or any of the Obligations of
the Borrower under any of the foregoing provisions of this Section 2.11 in any
manner.
SECTION 2.12. Sharing of Payments, Etc. If any Lender shall
obtain at any time any payment (whether voluntary, involuntary, through the
exercise of any right of setoff, or otherwise) (a) on account of Obligations due
and payable to such Lender under or in respect of this Agreement or any of the
other Loan Documents at such time in excess of its ratable share (according to
the proportion of (i) the amount of such Obligations due and payable to such
Lender at such time (other than pursuant to Section 2.09, 2.11, 9.04 or 9.07) to
(ii) the aggregate amount of the Obligations due and payable to all Lenders at
such time) of payments on account of the Obligations due and payable to all
Lenders under or in respect of this Agreement and the other Loan Documents at
such time obtained by all the Lenders at such time or (b) on account of
Obligations owing (but not due and payable) to such Lender under or in respect
of this Agreement or any of the other Loan Documents at such time in excess of
its ratable share (according to the proportion of (i) the amount of such
Obligations owing to such Lender at such time (other than pursuant to Section
2.09, 2.11, 9.04 or 9.07) to (ii) the aggregate amount of the Obligations owing
(but not due and payable) to all Lenders under or in respect of this Agreement
and the other Loan Documents at such time) of payments on account of the
Obligations owing (but not due and payable) to all Lenders
43
under or in respect of this Agreement and the other Loan Documents at such time
obtained by all of the Lenders at such time, such Lender shall forthwith
purchase from the other Lenders such interests or participating interests in the
Obligations due and payable or owing to them, as the case may be, as shall be
necessary to cause such purchasing Lender to share the excess payment ratably
with each of them; provided, however, that if all or any portion of such excess
payment is thereafter recovered from such purchasing Lender, such purchase from
each other Lender shall be rescinded and such other Lender shall repay to the
purchasing Lender the purchase price to the extent of such Lender's ratable
share (according to the proportion of (A) the purchase price paid to such Lender
to (B) the aggregate purchase price paid to all Lender) of such recovery,
together with an amount equal to such Lender's ratable share (according to the
proportion of (1) the amount of such other Lender's required repayment to (2)
the total amount so recovered from the purchasing Lender) of any interest or
other amount paid or payable by the purchasing Lender in respect of the total
amount so recovered. The Borrower hereby agrees that any Lender so purchasing an
interest or participating interest from another Lender pursuant to this Section
2.12 may, to the fullest extent permitted under applicable law, exercise all its
rights of payment (including the right of setoff) with respect to such an
interest or participating interest, as the case may be, as fully as if such
Lender were the direct creditor of the Borrower in the amount of such an
interest or participating interest.
SECTION 2.13. Use of Proceeds. The proceeds of the Working
Capital Advances shall be available (and the Borrower agrees that it shall use
such proceeds) solely to finance Permitted Acquisitions or to provide working
capital from time to time to the Borrower and its Subsidiaries and to pay
Existing Debt that is not Surviving Debt.
SECTION 2.14. Defaulting Lenders. (a) In the event that, at
any one time, (i) any Lender shall be a Defaulting Lender, (ii) such Defaulting
Lender shall owe a Defaulted Advance to the Borrower and (iii) the Borrower
shall be required to make any payment hereunder or under any other Loan Document
to or for the account of such Defaulting Lender, then the Borrower may, so long
as no Default shall occur or be continuing at such time and to the fullest
extent permitted by applicable law, set off and otherwise apply the Obligation
of the Borrower to make such payment to or for the account of such Defaulting
Lender against the obligation of such Defaulting Lender to make such Defaulted
Advance. In the event that, on any date, the Borrower shall so set off and
otherwise apply its obligation to make any such payment against the obligation
of such Defaulting Lender to make any such Defaulted Advance on or prior to such
date, the amount so set off and otherwise applied by the Borrower shall
constitute for all purposes of this Agreement and the other Loan Documents a
Working Capital Advance by such Defaulting Lender made on the date of such
setoff under the Working Capital Facility. Such Working Capital Advance shall be
a Base Rate Advance and shall be considered, for all purposes of this Agreement,
to comprise part of the Working Capital Borrowing in connection with which such
Defaulted Advance was originally required to have been made pursuant to Section
2.01, even if the other Working Capital Advances comprising such Working Capital
Borrowing shall be Eurodollar Rate Advances on the date such
44
Advance is deemed to be made pursuant to this subsection (a). The Borrower shall
notify the Administrative Agent at any time the Borrower exercises its right of
set-off pursuant to this subsection (a) and shall set forth in such notice (A)
the name of the Defaulting Lender and the Defaulted Advance required to be made
by such Defaulting Lender and (B) the amount set off and otherwise applied in
respect of such Defaulted Advance pursuant to this subsection (a). Any portion
of such payment otherwise required to be made by the Borrower to or for the
account of such Defaulting Lender which is paid by the Borrower, after giving
effect to the amount set off and otherwise applied by the Borrower pursuant to
this subsection (a), shall be applied by the Administrative Agent as specified
in subsection (b) or (c) of this Section 2.14.
(b) In the event that, at any one time, (i) any Lender shall
be a Defaulting Lender, (ii) such Defaulting Lender shall owe a Defaulted Amount
to the Administrative Agent or any of the other Lenders and (iii) the Borrower
shall make any payment hereunder or under any other Loan Document to the
Administrative Agent for the account of such Defaulting Lender, then the
Administrative Agent may, on its behalf or on behalf of such other Lenders and
to the fullest extent permitted by applicable law, apply at such time the amount
so paid by the Borrower to or for the account of such Defaulting Lender to the
payment of each such Defaulted Amount to the extent required to pay such
Defaulted Amount. In the event that the Administrative Agent shall so apply any
such amount to the payment of any such Defaulted Amount on any date, the amount
so applied by the Administrative Agent shall constitute for all purposes of this
Agreement and the other Loan Documents payment, to such extent, of such
Defaulted Amount on such date. Any such amount so applied by the Administrative
Agent shall be retained by the Administrative Agent or distributed by the
Administrative Agent to such other Lenders, ratably in accordance with the
respective portions of such Defaulted Amounts payable at such time to the
Administrative Agent and such other Lenders and, if the amount of such payment
made by the Borrower shall at such time be insufficient to pay all Defaulted
Amounts owing at such time to the Administrative Agent and the other Lenders, in
the following order of priority:
(i) first, to the Administrative Agent for any Defaulted
Amount then owing to the Administrative Agent;
(ii) second, to any other Lenders for any Defaulted Amounts
then owing to such other Lenders, ratably in accordance with such
respective Defaulted Amounts then owing to such other Lender.
Any portion of such amount paid by the Borrower for the account of such
Defaulting Lender remaining, after giving effect to the amount applied by the
Administrative Agent pursuant to this subsection (b), shall be applied by the
Administrative Agent as specified in subsection (c) of this Section 2.14.
(c) In the event that, at any one time, (i) any Lender shall
be a Defaulting Lender, (ii) such Defaulting Lender shall not owe a Defaulted
Advance or a Defaulted Amount and (iii) the
45
Borrower, the Administrative Agent or any other Lender shall be required to pay
or distribute any amount hereunder or under any other Loan Document to or for
the account of such Defaulting Lender, then the Borrower or such other Lender
shall pay such amount to the Administrative Agent to be held by the
Administrative Agent, to the fullest extent permitted by applicable law, in
escrow or the Administrative Agent shall, to the fullest extent permitted by
applicable law, hold in escrow such amount otherwise held by it. Any funds held
by the Administrative Agent in escrow under this subsection (c) shall be
deposited by the Administrative Agent in an account at a bank (the "Escrow
Bank") selected by the Administrative Agent at the time, in the name and under
the control of the Administrative Agent, but subject to the provisions of this
subsection (c). The terms applicable to such account, including the rate of
interest payable with respect to the credit balance of such account from time to
time, shall be Escrow Bank's standard terms applicable to escrow accounts
maintained with it. Any interest credited to such account from time to time
shall be held by the Administrative Agent in escrow under, and applied by the
Administrative Agent from time to time in accordance with the provisions of,
this subsection (c). The Administrative Agent shall, to the fullest extent
permitted by applicable law, apply all funds so held in escrow from time to time
to the extent necessary to make any Working Capital Advances required to be made
by such Defaulting Lender and to pay any amount payable by such Defaulting
Lender hereunder and under the other Loan Documents to the Administrative Agent
or any other Lender, as and when such Working Capital Advances or amounts are
required to be made or paid and, if the amount so held in escrow shall at any
time be insufficient to make and pay all such Working Capital Advances and
amounts required to be made or paid at such time, in the following order of
priority:
(i) first, to the Administrative Agent for any amount then due
and payable by such Defaulting Lender to the Administrative Agent
hereunder;
(ii) second, to any other Lenders for any amount then due and
payable by such Defaulting Lender to such other Lenders hereunder,
ratably in accordance with such respective amounts then due and payable
to such other Lenders; and
(iii) third, to the Borrower for any Advance then required to
be made by such Defaulting Lender pursuant to its Working Capital
Commitment.
In the event that any Lender that is a Defaulting Lender shall, at any time,
cease to be a Defaulting Lender, any funds held by the Administrative Agent in
escrow at such time with respect to such Lender shall be distributed by the
Administrative Agent to such Lender and applied by such Lender to the
Obligations owing to such Lender at such time under this Agreement and the other
Loan Documents ratably in accordance with the respective amounts of such
Obligations outstanding at such time.
(d) The rights and remedies against a Defaulting Lender under
this Section 2.14 are in addition to other rights and remedies that the Borrower
may have against such Defaulting
46
Lender with respect to any Defaulted Advance and that the Administrative Agent
or any Lender may have against such Defaulting Lender with respect to any
Defaulted Amount.
ARTICLE III
CONDITIONS OF LENDING
SECTION 3.01. Conditions Precedent to Initial Extension of
Credit. The obligation of each Lender to make an Advance on the occasion of the
Initial Extension of Credit hereunder is subject to the satisfaction of the
following conditions precedent prior to or concurrently with the Initial
Extension of Credit:
(a) The Lenders shall be satisfied with the corporate and
legal structure and capitalization of each Loan Party, including the
terms and conditions of the charter, bylaws and each class of capital
stock of each Loan Party and of each agreement or instrument relating
to such structure or capitalization.
(b) The Lenders shall be satisfied that all Existing Debt,
other than the Debt identified on Part B of Schedule 4.01(y) (the
"Surviving Debt"), has been prepaid, redeemed or defeased in full or
otherwise satisfied and extinguished, that all liens on assets of the
Loan Parties securing any such Existing Debt have been released of
record.
(c) Before giving effect to the transactions contemplated by
this Agreement, there shall have occurred no Material Adverse Change
since June 30, 1998.
(d) There shall exist no action, suit, investigation,
litigation or proceeding affecting any Loan Party pending or threatened
before any court, governmental agency or arbitrator that (i) could have
a Material Adverse Effect or (ii) purports to affect the legality,
validity or enforceability of this Agreement, any Working Capital Note,
any other Loan Document, or the consummation of the transactions
contemplated hereby or the Initial Public Offering.
(e) Nothing shall have come to the attention of the Lenders to
lead them to believe (i) that any information provided to them in
connection with the transactions contemplated hereby (including,
without limitation, the Registration Statement) was or has become
misleading, incorrect or incomplete in any material respect and (ii)
that the Loan Parties would not have good and marketable title to all
of their material assets.
(f) The Borrower shall have paid all accrued fees and expenses
of the Administrative Agent and the Lenders (including the accrued
reasonable fees and expenses of counsel to the Administrative Agent).
47
(g) The Borrower shall have filed with the Securities and
Exchange Commission a registration statement (the "Registration
Statement") on form S-1 with respect to 4,166,667 shares of its common
stock, par value $0.01 per share (the "Borrower Common Stock") and
shall have caused the Registration Statement to become effective under
the Securities Act of 1933 (as amended); and the Borrower shall have
sold not less 4,166,667 shares of Borrower Company Stock to the
underwriters (the "Underwriters") referred to in the Registration
Statement at purchase price of not less than $11.50 per share and shall
have received Net Cash Proceeds therefrom of not less than $42,862,503.
The Lenders shall have received a copy of the Registration Statement
and all documentation entered into or delivered by the Borrower or any
other Loan Party in connection therewith (including any agreements with
the Underwriters) and the same shall be in form and substance
reasonably satisfactory to the Administrative Agent.
(h) The Administrative Agent shall have received on or before
the day of the Initial Extension of Credit the following, each dated
such day (unless otherwise specified), in form and substance
satisfactory to the Lenders (unless otherwise specified) and (except
for the Working Capital Notes) in sufficient copies for each Lender:
(i) The Working Capital Notes payable to the order
of the Lenders.
(ii) Certified copies of the resolutions of the Board
of Directors of each Loan Party approving this Agreement, the
Working Capital Notes and each other Loan Document to which it
is or is to be a party, and of all documents evidencing other
necessary corporate action and governmental and other third
party approvals and consents, if any, with respect to this
Agreement, the Working Capital Notes and each other Loan
Document.
(iii) A copy of the charter of each Loan Party and
each amendment thereto, certified (as of a date reasonably
near the date of the Initial Extension of Credit) by the
Secretary of State of the jurisdiction of its incorporation as
being a true and correct copy thereof.
(iv) A copy of a certificate of the Secretary of
State of the jurisdiction of its incorporation, dated
reasonably near the date of the Initial Extension of Credit,
listing the charter of each Loan Party and each amendment
thereto on file in his or her office and certifying that (A)
such amendments are the only amendments to such Loan Party's
charter on file in his or her office, (B) each Loan Party have
paid all franchise taxes to the date of such certificate and
(C) each Loan Party is duly incorporated and in good standing
under the laws of the State of the jurisdiction of its
incorporation.
48
(v) A copy of a certificate of the appropriate State
governmental authority of each jurisdiction in which each Loan
Party is organized, dated reasonably near the date of the
Initial Extension of Credit, certifying as to the recording of
a certified copy of the charter of such Loan Party and each
amendment thereto in his or her office.
(vi) A copy of a certificate of the Secretary of
State of each State in which each Loan Party is organized or
conducts business, dated reasonably near the date of the
Initial Extension of Credit, stating that such Loan Party is
duly qualified and in good standing as a foreign corporation
in such States and have filed all annual reports required to
be filed to the date of such certificate; provided that no
such certificates shall be required for any such States if the
failure of any Loan Party to be qualified as a foreign
corporation in such States, individually or in the aggregate,
could not be reasonably expected to have a Material Adverse
Effect.
(vii) A certificate of each Loan Party, signed on
behalf of such Loan Party by its President or a Vice President
and its Secretary or any Assistant Secretary, dated the date
of the Initial Extension of Credit (the statements made in
which certificate shall be true on and as of the date of the
Initial Extension of Credit), certifying as to (A) the absence
of any amendments to the charter of such Loan Party since the
date of the Secretary of State's certificate referred to in
Section 3.01(h)(iv), (B) a true and correct copy of the bylaws
of such Loan Party as in effect on the date of the Initial
Extension of Credit, (C) the due incorporation and good
standing of such Loan Party as a corporation organized under
the laws of the State of its organization, and the absence of
any proceeding for the dissolution or liquidation of such Loan
Party, (D) the truth of the representations and warranties
contained in the Loan Documents as though made on and as of
the date of the Initial Extension of Credit and (E) the
absence of any event occurring and continuing, or resulting
from the Initial Extension of Credit, that constitutes a
Default.
(viii) A certificate of the Secretary or an Assistant
Secretary of each Loan Party certifying the names and true
signatures of the officers of such Loan Party authorized to
sign this Agreement, the Working Capital Notes and each other
Loan Document to which it is or is to be a party and the other
documents to be delivered hereunder and thereunder.
(ix) A security agreement in substantially the form
of Exhibit D (together with each other security agreement
delivered pursuant to Section 5.01(m), in each case as
amended, supplemented or otherwise modified from time to time
in accordance with its terms, the "Security Agreement"), duly
executed by the Borrower and each of its Subsidiaries,
together with:
49
(A) certificates representing the Pledged
Shares referred to therein accompanied by undated
stock powers executed in blank and instruments
evidencing the Pledged Debt referred to therein
indorsed in blank,
(B) copies of proper financing statements in
the appropriate form for filing under the Uniform
Commercial Code of all jurisdictions that the
Administrative Agent may deem necessary or desirable
in order to perfect and protect the liens and
security interests created under the Security
Agreement, covering the Collateral described in the
Security Agreement,
(C) completed requests for information,
dated on or before the date of the Initial Extension
of Credit, listing all effective financing statements
filed in the jurisdictions referred to in clause (B)
above that name the Borrower, or any other Loan Party
as debtor, together with copies of such other
financing statements, and
(D) evidence that all other action that the
Administrative Agent may deem reasonably necessary or
desirable in order to perfect and protect the first
priority liens and security interests created under
the Security Agreement has been taken.
(x) Such financial, business and other information
regarding each Loan Party as the Lenders shall have reasonably
requested, including, without limitation, information as to
possible contingent liabilities, tax matters, environmental
matters, obligations under Plans, Multiemployer Plans and
Welfare Plans, collective bargaining agreements and other
arrangements with employees, audited consolidated annual
financial statements dated June 30, 1998, interim consolidated
financial statements dated the end of the most recent fiscal
quarter for which financial statements are available, pro
forma financial statements as to the Borrower and its
Subsidiaries and forecasts prepared by management of the
Borrower and its Subsidiaries, in form and substance
satisfactory to the Lenders, of balance sheets, income
statements and cash flow statements on a quarterly basis for
the first year following the day of the Initial Extension of
Credit and on an annual basis for each year thereafter until
the Termination Date.
(xi) Certificates, in form and substance satisfactory
to the Lenders, attesting to the Solvency of each Loan Party
after giving effect to the transactions contemplated hereby,
from its chief financial officer.
(xii) A letter, in form and substance satisfactory to
the Administrative Agent, from the Borrower to Deloitte &
Touche LLP, its independent certified public accountants,
advising such accountants that the Administrative Agent and
the
50
Lenders have been authorized to exercise all rights of the
Borrower to require such accountants to disclose any and all
financial statements and any other information of any kind
that they may have with respect to the Borrower and its
Subsidiaries and directing such accountants to comply with any
reasonable request of the Administrative Agent or any Lender
for such information.
(xiii) Evidence of insurance naming the
Administrative Agent as insured and loss payee with such
responsible and reputable insurance companies or associations,
and in such amounts and covering such risks, as is
satisfactory to the Lenders, including, without limitation,
business interruption insurance.
(xiv) Certified copies of each employment agreement
and other compensation arrangement with each executive officer
of any Loan Party.
(xv) A favorable opinion of Reboul, MacMurray,
Xxxxxx, Xxxxxxx & Kristol, special counsel to the Loan
Parties, and Ohio and Missouri counsels to the Loan Parties
reasonably acceptable to the Lenders, such opinions to be in
form and substance reasonably satisfactory to the Lenders.
(i) The Initial Extension of Credit shall have been made on or
prior to March 31, 1999.
SECTION 3.02. Conditions Precedent to Each Working Capital
Borrowing. The obligation of each Lender to make an Advance on the occasion of
each Working Capital Borrowing (including the Initial Extension of Credit),
shall be subject to the further conditions precedent that on the date of such
Working Capital Borrowing (a) the following statements shall be true (and each
of the giving of the applicable Notice of Borrowing and the acceptance by the
Borrower of the proceeds of such Working Capital Borrowing shall constitute a
representation and warranty by the Borrower that both on the date of such notice
and on the date of such Working Capital Borrowing or issuance such statements
are true):
(i) the representations and warranties contained in each Loan
Document are correct on and as of such date, before and after giving
effect to such Working Capital Borrowing and to the application of the
proceeds therefrom, as though made on and as of such date other than
any such representations or warranties that, by their terms, refer to a
specific date other than the date of such Working Capital Borrowing, in
which case as of such specific date; and
(ii) no event has occurred and is continuing, or would result
from such Working Capital Borrowing or from the application of the
proceeds therefrom, that constitutes a Default,
51
and (b) the Administrative Agent shall have received such other approvals,
opinions or documents as any Appropriate Lender through the Administrative Agent
may reasonably request.
SECTION 3.03. Determinations Under Section 3.01. For purposes
of determining compliance with the conditions specified in Section 3.01, each
Lender shall be deemed to have consented to, approved or accepted or to be
satisfied with each document or other matter required thereunder to be consented
to or approved by or acceptable or satisfactory to the Lenders unless an officer
of the Administrative Agent responsible for the transactions contemplated by the
Loan Documents shall have received notice from such Lender prior to the Initial
Extension of Credit specifying its objection thereto and if the Initial
Extension of Credit consists of a Working Capital Borrowing, such Lender shall
not have made available to the Administrative Agent such Lender's Pro Rata Share
of such Borrowing.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
SECTION 4.01. Representations and Warranties of the Borrower.
Each Loan Party represents and warrants as to itself as follows:
(a) Each Loan Party (i) is a corporation, limited partnership
or limited liability company duly organized and validly existing under
the laws of the jurisdiction of its organization and is in good
standing under the laws of such jurisdiction and (ii) is duly qualified
as a foreign corporation, limited partnership or limited liability
company and is in good standing in each other jurisdiction in which the
ownership, lease or operation of its property and assets or the conduct
of its business require it to so qualify or be licensed, except, solely
in the case of this clause (ii), where the failure to so qualify or be
licensed or to be in good standing, either individually or in the
aggregate, could not reasonably be expected to have a Material Adverse
Effect. Each Loan Party has all of the requisite power and authority
(including all Governmental Authorizations), and the legal right, to
own or lease and to operate all of the property and assets it purports
to own, lease or operate and to conduct all of its business as now
conducted and as proposed to be conducted. Each Loan Party has all of
the requisite power and authority, and the legal right, to execute and
deliver each of the Loan Documents to which it is or is to be a party,
to perform all of its Obligations hereunder and thereunder and to
consummate the transactions contemplated hereby. All of the outstanding
Equity Interests in the Borrower have been validly issued, are fully
paid and nonassessable. Schedule 4.01(a) hereof sets forth, as of the
date hereof, the type and amount of all outstanding Equity Interests in
the Borrower that are owned directly or indirectly by one or more of
the WCAS Funds, and such Equity Interest are owned by the WCAS Funds
free and clear of all Liens (including, without limitation, preemptive
or other similar rights of the holders thereof), except those created
under the Collateral Documents.
52
(b) Set forth on Schedule 4.01(b) hereto is a complete and
accurate list of all Subsidiaries of the Borrower, showing, as of the
date of this Agreement, as to each such Subsidiary, the correct legal
name thereof, the legal structure thereof, the jurisdiction of its
organization, the number and type of each class of its Equity Interests
authorized and the number outstanding, and the percentage of each such
class of its Equity Interests outstanding on such date that are owned
by the Borrower. All of the outstanding Equity Interests in the
Subsidiaries of the Borrower have been validly issued, are fully paid
and nonassessable and are owned directly by the Borrower in the type
and amounts disclosed on Schedule 4.01(b) hereto free and clear of all
Liens (including, without limitation, preemptive or other similar
rights of the holders thereof), except those created under the
Collateral Documents. No Subsidiary of the Borrower has any
Subsidiaries.
(c) The execution, delivery and performance by each Loan Party
of each Loan Document to which it is or is to be a party, and the
consummation of the transactions contemplated hereby, have been duly
authorized by all necessary action (including, without limitation, all
necessary shareholder or other similar action) and do not:
(i) contravene the Constitutive Documents of such
Loan Party;
(ii) violate any Requirement of Law;
(iii) conflict with or result in the breach of, or
constitute a default under, any loan agreement, indenture,
mortgage, deed of trust, lease, instrument, contract or other
agreement binding on or affecting such Loan Party or any of
its property or assets; or
(iv) except for the Liens created under the
Collateral Documents, result in or require the creation or
imposition of any Lien upon or with respect to any of the
property or assets of such Loan Party.
None of the Loan Parties is in violation of any Requirement of Law or
in breach of any loan agreement, indenture, mortgage, deed of trust,
lease, instrument, contract or other agreement referred to in the
immediately preceding sentence, the violation or breach of which,
either individually or in the aggregate, could reasonably be expected
to have a Material Adverse Effect.
(d) No Governmental Authorization, and no other consent,
approval or authorization of, or notice to or filing with, or other
action by, any other Person is required for:
53
(i) the due execution, delivery, recordation, filing
or performance by any Loan Party of any of the Loan Documents
to which it is or is to be a party, or for the consummation of
any aspect of the transactions contemplated hereby;
(ii) the grant by any Loan Party of the Liens granted
by it pursuant to the Collateral Documents;
(iii) the perfection or maintenance of the Liens
created under the Collateral Documents (including the first
priority nature thereof); or
(iv) the exercise by the Administrative Agent or any
of the Lenders of its rights under the Loan Documents or the
remedies in respect of the Collateral pursuant to the
Collateral Documents;
except for the Governmental Authorizations, and the other consents,
approvals, authorizations, notices, filings and other actions,
described on Schedule 4.01(d) hereto. All of the Governmental
Authorizations, and other the consents, approvals, authorizations,
notices, filings and other actions, described on Schedule 4.01(d)
hereto have been or will have been duly obtained, taken, given or made
on or prior to the date of the Initial Extension of Credit and are, or
on the date of the Initial Extension of Credit will be, in full force
and effect, or, if expressly provided for on Schedule 4.01(d) hereto,
will be duly obtained, taken, given or made in accordance with the
terms set forth therefor on Schedule 4.01(d) hereto and, thereafter,
will be in full force and effect. All applicable waiting periods in
connection with each aspect of the transactions contemplated hereby
have expired without any action having been taken by any competent
authority restraining, preventing or imposing materially adverse
conditions upon any aspect of such transactions or the rights of any
Loan Party freely to transfer or otherwise dispose of, or to create any
Lien on, any property or assets now owned or hereafter acquired by any
of them. No Loan Party has received any notice relating to or
threatening the revocation, termination, cancellation, denial,
impairment or modification of any such Governmental Authorization, or
is in violation or contravention of, or in default under, any such
Governmental Authorization, except for those that could not,
individually or in the aggregate, be reasonably expected to have a
Material Adverse Effect and by general principles of equity.
(e) This Agreement has been, and each of the other Loan
Documents when delivered hereunder will have been, duly executed and
delivered by each of the Loan Parties intended to be a party thereto.
This Agreement is, and each of the other Loan Documents when delivered
hereunder will be, the legal, valid and binding obligations of each of
the Loan Parties intended to be a party thereto, enforceable against
such Loan Party in accordance with their respective terms, except to
the extent such enforceability may be limited by the effect of
applicable bankruptcy, insolvency, reorganization, moratorium or other
similar laws affecting the enforcement of creditors' rights generally.
54
(f) The Consolidated balance sheets of the Borrower and its
Subsidiaries as at June 30, 1997 and June 30, 1998, and the related
Consolidated statements of income and cash flow of the Borrower and its
Subsidiaries for the fiscal years then ended, accompanied by an
unqualified opinion of Deloitte & Touche LLP, independent public
accountants of the Borrower, and the Consolidated balance sheet of the
Borrower and its Subsidiaries as at September 30, 1998, and the related
Consolidated statements of income and cash flow of the Borrower and its
Subsidiaries for the 3 month period then ended, duly certified by the
chief financial officer of the Borrower, copies of all of which have
been furnished to each Lender, fairly present, subject, in the case of
said balance sheets as at September 30, 1998, and said statements of
income and cash flow for the 3 month period then ended, to year-end
audit adjustments and the absence of footnotes, the Consolidated
financial condition of the Borrower and its Subsidiaries as at such
dates and the Consolidated results of the operations of the Borrower
and its Subsidiaries for the periods ended on such dates, all in
accordance with generally accepted accounting principles applied on a
consistent basis. Neither the Borrower nor any of its Subsidiaries has
any material fixed or contingent liabilities, liabilities for taxes,
unusual forward or long-term commitments or anticipated losses from any
unfavorable commitments, except as referred to, or reflected or
provided for in, the financial statements referred to above in this
Section 4.01(f) or as described in reasonable detail on Schedule
4.01(f) hereto. Since June 30, 1998, there has been no Material Adverse
Change.
(g) The Consolidated pro forma balance sheet of the Borrower
and its Subsidiaries as at December 31, 1998, and the related
Consolidated pro forma statements of income and cash flow of the
Borrower and its Subsidiaries for the twelve months then ended, duly
certified by the chief financial officer of the Borrower, copies of
which have been furnished to each Lender, fairly present the
Consolidated pro forma financial condition of the Borrower and its
Subsidiaries as at such date and the Consolidated pro forma results of
operations of the Borrower and its Subsidiaries for the period ended on
such date, in each case after giving effect to the transactions
contemplated hereby, all in accordance with GAAP.
(h) The Consolidated forecasted balance sheets, income
statements and cash flow statements of the Borrower and its
Subsidiaries delivered to the Lenders pursuant to Section 3.01(h)(x) or
5.03 were prepared in good faith on the basis of the assumptions stated
therein, which assumptions were fair in the light of conditions
existing at the time of delivery of such forecasts, and represented, at
the time of delivery, the Borrower's best estimate of its future
financial performance (although the actual results during the periods
covered by such forecasts may differ from the forecasted results).
(i) Neither the Registration Statement nor any other
information, exhibit or report (other than financial projections and
pro forma financial information) furnished by or on behalf any Loan
Party to any Agent or any Lender in connection with the Loan Documents
or pursuant to the terms of the Loan Documents contains any untrue
statement of a material
55
fact or omits to state a material fact necessary to make the statements
made therein, in light of the circumstances in which any such
statements were made, not misleading.
(j) There is no action, suit, investigation, litigation,
arbitration or proceeding pending or, to the best knowledge of the Loan
Parties, threatened against or affecting any Loan Party or any of the
property or assets thereof in any court or before any arbitrator or by
or before any Governmental Authority of any kind that (i) either
individually or in the aggregate, could reasonably be expected to have
a Material Adverse Effect or (ii) purports to affect the legality,
validity, binding effect or enforceability of any of the Loan Documents
or any aspect of the transactions contemplated hereby.
(k) Each Loan Party is the legal and beneficial owner of the
Collateral purported to be owned thereby under the Collateral
Documents, free and clear of all Liens, except for the liens and
security interests created under the Collateral Documents and except
for Liens permitted under Section 5.02(a). The Collateral Documents
create valid and perfected first priority liens on and security
interests in the Collateral in favor of the Administrative Agent, for
the benefit of the Secured Parties, securing the payment of the Secured
Obligations. All of the Equity Interests in the Subsidiaries of the
Borrower that are purported to comprise part of the Collateral have
been delivered to the Administrative Agent as required under the terms
of the Collateral Documents, together with undated stock powers or
other appropriate powers duly executed in blank; all filings and other
actions necessary to perfect and protect the liens and security
interests of the Administrative Agent in the Collateral have been duly
made or taken and are in full force and effect or will be duly made or
taken in accordance with the terms of the Loan Documents; and all
filing fees and recording taxes have been paid in full.
(l) The Borrower is not engaged in the business of extending
credit for the purpose of purchasing or carrying Margin Stock, and no
proceeds of any Advance will be used to purchase or carry any Margin
Stock or to extend credit to others for the purpose of purchasing or
carrying any Margin Stock.
(m) No Loan Party is an "investment company," or an
"affiliated person" of, or "promoter" or "principal underwriter" for,
an "investment company" (as such terms are defined in the Investment
Company Act of 1940, as amended). None of the making of any Working
Capital Advances or the application of the proceeds or repayment
thereof by the Borrower, or the consummation of any of transactions
contemplated hereby, will violate any provision of such Act or any
rule, regulation or order of the Securities and Exchange Commission
thereunder.
(n) Each Loan Party is Solvent.
(o) Neither the business nor the property and assets of any
Loan Party are or have been affected by any fire, explosion, accident,
drought, storm, hail, earthquake, embargo, act
56
of God or of the public enemy or other casualty (whether or not covered
by insurance) that, either individually or in the aggregate, could
reasonably be expected to have a Material Adverse Effect.
(p) There is (i) no unfair labor practice complaint pending
or, to the best knowledge of the Loan Parties, threatened against any
Loan Party by or before any Governmental Authority and no grievance or
arbitration proceeding pending or, to the best knowledge of the Loan
Parties, threatened against any Loan Party which arises out of or under
any collective bargaining agreement that, either individually or in the
aggregate, could reasonably be expected to have a Material Adverse
Effect, (ii) no strike, labor dispute, slowdown, stoppage or similar
action or grievance pending or, to the best knowledge of the Loan
Parties, threatened against any Loan Party and (iii) no union
representation question existing with respect to the employees of any
Loan Party and no union organizing activity taking place with respect
to any of the employees of any of them.
(q) (i) No ERISA Event has occurred or is reasonably expected
to occur with respect to any Plan that has resulted in or is reasonably
expected to result in a material liability of any Loan Party or any
ERISA Affiliate.
(ii) Schedule B (Actuarial Information) to the most recent
annual report (Form 5500 Series) for each Plan, copies of which have
been filed with the Internal Revenue Service and furnished to the
Lenders, is complete and accurate and fairly presents the funding
status of such Plan; and since the date of such Schedule B there has
been no material adverse change in such funding status.
(iii) Neither any Loan Party nor any ERISA Affiliate has
incurred or is reasonably expected to incur any Withdrawal Liability to
any Multiemployer Plan.
(iv) Neither any Loan Party nor any ERISA Affiliate has been
notified by the sponsor of a Multiemployer Plan that such Multiemployer
Plan is in reorganization or has been terminated, within the meaning of
Title IV of ERISA, and no such Multiemployer Plan is reasonably
expected to be in reorganization or to be terminated, within the
meaning of Title IV of ERISA.
(r) The operations and properties of each Loan Party comply in
all material respects with all applicable Environmental Laws and
Environmental Permits, all past noncompliance with such Environmental
Laws and Environmental Permits has been resolved without ongoing
obligations or costs, and no circumstances exist that could (i) form
the basis of an Environmental Action against any Loan Party or any of
its properties that, either individually or in the aggregate, could
reasonably be expected to have a Material Adverse Effect or (ii) cause
any such property to be subject to any restrictions on ownership,
occupancy, use or transferability under any Environmental Law.
57
(s) None of the properties currently or formerly owned or
operated by any Loan Party is listed or proposed for listing on the NPL
or on the CERCLIS or any analogous foreign, state or local list or is
adjacent to any such property; there are no and, to the best knowledge
of the Loan Parties, never have been any underground or aboveground
storage tanks or any surface impoundments, septic tanks, pits, sumps or
lagoons in which Hazardous Materials are being or have been treated,
stored or disposed on any property currently owned or operated by any
Loan Party or, to the best of its knowledge, on any property formerly
owned or operated by any Loan Party; there is no asbestos or
asbestos-containing material on any property currently owned or
operated by any Loan Party, except for those, the existence of which
could not, individually or in the aggregate, could not form the basis
of an Environmental Action that could be reasonably expected to have a
Material Adverse Effect; and Hazardous Materials have not been
released, discharged or disposed of on any property currently or
formerly owned or operated by any Loan Party.
(t) No Loan Party is undertaking, and has not completed,
either individually or together with other potentially responsible
parties, any investigation or assessment or remedial or response action
relating to any actual or threatened release, discharge or disposal of
Hazardous Materials at any site, location or operation, either
voluntarily or pursuant to the order of any Governmental Authority or
the requirements of any Environmental Law; and all Hazardous Materials
generated, used, treated, handled or stored at, or transported to or
from, any property currently or formerly owned or operated by any Loan
Party have been disposed of in a manner not reasonably expected to
result in material liability to any Loan Party.
(u) Each Loan Party and their Affiliates have filed, have
caused to be filed or have been included in all tax returns, reports
and statements (federal, state, local and foreign) required to be filed
and have paid all taxes, assessments, levies, fees and other charges
shown thereon (or on any assessments received by any such Person or of
which any such Person has been notified) to be due and payable,
together with applicable interest and penalties, except for any such
taxes, assessments, levies, fees and other charges the amount,
applicability or validity of which is being contested in good faith and
by appropriate proceedings diligently conducted and with respect to
which such Loan Party or Affiliate may be, has established appropriate
and adequate reserves in accordance with GAAP. All of the tax returns,
reports and statements referred to in the immediately preceding
sentence have been prepared in good faith and are complete and accurate
in all material respects for the Loan Parties and their Affiliates for
the respective periods covered thereby.
(v) Set forth on Schedule 4.01(y) hereto is a complete and
accurate list, as of the date of this Agreement, of each Open Year of
each Loan Party and its Affiliates. There are no adjustments to (i) the
federal income tax liability (including, without limitation, interest
and penalties) of any Loan Party or its Affiliates proposed in writing
by the Internal Revenue Service with respect to Open Years or (ii) any
foreign, state or local tax liability (including,
58
without limitation, interest and penalties) of any Loan Party or any of
its Affiliates proposed in writing by any foreign, state or local
taxation authority that, in the aggregate for subclauses (i) and (ii)
of this sentence, would exceed $100,000. No issues have been raised by
the Internal Revenue Service in respect of Open Years or by any such
foreign, state or local taxation authorities that, either individually
or in the aggregate, could reasonably be expected to have a Material
Adverse Effect.
(w) Neither any Loan Party nor any of its Affiliates has
entered into an agreement or waiver or been requested to enter into an
agreement or waiver extending any statute of limitations relating to
the assessment, reassessment, payment or collection of taxes of such
Loan Party or any such Affiliate, or is aware of any circumstances that
would cause the taxable years or other taxable periods of such Loan
Party or any such Affiliate to no longer be subject to the normally
applicable statute of limitations. Neither any Loan Party nor any of
its Affiliates has provided, with respect to itself or any property
held by it, any consent under Section 341(f) of the Internal Revenue
Code.
(x) Each Loan Party, on behalf of itself and its Subsidiaries,
(i) has 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 reasonably
expected to be adversely affected by the risk that computer
applications used by such Loan Party or any of its Subsidiaries (or by
their respective suppliers, vendors and customers) may be unable to
recognize and perform properly date-sensitive functions involving
certain dates prior to and any date after December 31, 1999
(collectively, the "Year 2000 Problem"), (ii) has developed a plan and
timeline for addressing the Year 2000 Problem on a timely basis and
(iii) has implemented such plan to date in accordance with such
timetable. Based on the foregoing, each of the Loan Parties believes
that all computer applications (including those of its and each of its
Subsidiaries' suppliers, vendors and customers) 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 September 30,
1999, except to the extent that a failure to do so, either individually
or in the aggregate, could not reasonably be expected to have Material
Adverse Effect.
(y) Set forth on Part A of Schedule 4.01(y) hereto is a
complete and accurate list, as of the date of this Agreement, of all of
the Debt of any Loan Party existing on such date (collectively, the
"Existing Debt"), showing, as of such date, each of the Loan Parties
party thereto, the principal amount outstanding thereunder, the
interest rate thereon, the scheduled maturity date thereof and the
amortization schedule, if any, therefor. Set forth on Part B of
Schedule 4.01(y) hereto is a complete and accurate list, as of the date
of this Agreement, of all of the Surviving Debt on such date, showing,
as of such date, each of the Loan Parties party thereto, the principal
amount outstanding thereunder, the interest rate thereon, the scheduled
maturity date thereof and the amortization schedule, if any, therefor.
59
(z) Set forth on Part A of Schedule 4.01(z) hereto is a
complete and accurate list of all real property owned by any Loan Party
showing as of the date hereof the street address, county or other
relevant jurisdiction, state, and record owner. Each Loan Party has
good, marketable and insurable fee simple title to such real property,
free and clear of all Liens, other than Liens created or permitted by
the Loan Documents. Set forth on Part B of Schedule 4.01(z) hereto is a
complete and accurate list of all leases of real property under which
any Loan Party is the lessee, showing as of the date hereof the street
address, county or other relevant jurisdiction, state, lessor, lessee,
expiration date and annual rental cost thereof. Each such lease is the
legal, valid and binding obligation of the lessor thereof, enforceable
in accordance with its terms except to the extent such enforceability
may be limited by the effect of applicable bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting the
enforcement of creditors' rights generally and by general principles of
equity.
(aa) Set forth on Schedule 5.02(e) hereto is a complete and
accurate list, as of the date of this Agreement, of all of the
Investments (other than cash and Cash Equivalents) held by any Loan
Party, showing, as of such date, the amount, the obligor or issuer
thereof and the maturity, if any, thereof.
(bb) Set forth on Schedule 4.01(bb) hereto is a complete and
accurate list of all patents, trademarks, trade names, service marks
and copyrights, and all applications therefor and licenses thereof, of
each Loan Party showing as of the date hereof the jurisdiction in which
registered, the registration number, the date of registration and the
expiration date.
ARTICLE V
COVENANTS OF THE BORROWER
SECTION 5.01. Affirmative Covenants. So long as any Advance
shall remain unpaid or any Lender shall have any Working Capital Commitment
hereunder, each Loan Party will:
(a) Compliance with Laws, Etc. Comply, and cause each of its
Subsidiaries to comply, in all material respects, with all applicable
laws, rules, regulations and orders, such compliance to include,
without limitation, compliance with ERISA and the Racketeer Influenced
and Corrupt Organizations Chapter of the Organized Crime Control Act of
1970.
(b) Payment of Taxes, Etc. Pay and discharge, and cause each
of its Subsidiaries to pay and discharge, before the same shall become
delinquent, (i) all taxes, assessments and governmental charges or
levies imposed upon it or upon its property and (ii) all lawful claims
that, if unpaid, might by law become a Lien upon its property;
provided, however, that neither the Borrower nor any of its
Subsidiaries shall be required to pay or discharge any
60
such tax, assessment, charge or claim that is being contested in good
faith and by proper proceedings and as to which appropriate reserves
are being maintained, unless and until any Lien resulting therefrom
attaches to its property and becomes enforceable against its other
creditors.
(c) Compliance with Environmental Laws. Comply, and cause each
of its Subsidiaries and all lessees and other Persons operating or
occupying its properties to comply, in all material respects, with all
applicable Environmental Laws and Environmental Permits, except to the
extent that the failure to comply therewith, individually or in the
aggregate, could not be reasonably expected to have a Material Adverse
Effect; obtain and renew and cause each of its Subsidiaries to obtain
and renew all Environmental Permits necessary for its operations and
properties except to the extent that the failure to obtain or renew any
such Environmental Permits could not, individually or in the aggregate,
be reasonably expected to have a Material Adverse Effect; and conduct,
and cause each of its Subsidiaries to conduct, any investigation,
study, sampling and testing, and undertake any cleanup, removal,
remedial or other action necessary to remove and clean up all Hazardous
Materials from any of its properties, in accordance with the
requirements of all Environmental Laws; provided, however, that neither
the Borrower nor any of its Subsidiaries shall be required to undertake
any such cleanup, removal, remedial or other action to the extent that
its obligation to do so is being contested in good faith and by proper
proceedings and appropriate reserves are being maintained with respect
to such circumstances.
(d) Maintenance of Insurance. Maintain, and cause each of its
Subsidiaries to maintain, insurance with responsible and reputable
insurance companies or associations in such amounts and covering such
risks as is usually carried by companies engaged in similar businesses
and owning similar properties in the same general areas in which such
Loan Party or such Subsidiary operates.
(e) Preservation of Corporate Existence, Etc. Preserve and
maintain, and cause each of its Subsidiaries to preserve and maintain,
its existence, legal structure, legal name, rights (charter and
statutory), permits, licenses, approvals, privileges and franchises;
provided, however, that the Borrower and its Subsidiaries may
consummate any other merger or consolidation permitted under Section
5.02(c) and provided further that neither any Loan Party nor any
Subsidiary of a Loan Party shall be required to preserve any right,
permit, license, approval, privilege or franchise if the Board of
Directors of such Loan Party or such Subsidiary shall determine that
the preservation thereof is no longer desirable in the conduct of the
business of such Loan Party or such Subsidiary, as the case may be, and
that the loss thereof is not disadvantageous in any material respect to
such Loan Party, such Subsidiary or the Lenders.
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(f) Visitation Rights. At any reasonable time and from time to
time, permit the Administrative Agent or any of the Lenders or any
agents or representatives thereof, to examine and make copies of and
abstracts from the records and books of account of, and visit the
properties of, each Loan Party and any Subsidiary of each Loan Party,
and to discuss the affairs, finances and accounts of each Loan Party
and any of its Subsidiaries with any of their officers or directors and
with their independent certified public accountants; provided that if
the Administrative Agent and the Lenders undertake more than two such
visits to the properties of the Loan Parties in any Fiscal Year, the
Borrower shall not be required to reimburse the Lenders for the costs
and expenses of the third and subsequent visits during such Fiscal Year
unless an Event of Default shall occur and be continuing at the time
thereof.
(g) Preparation of Environmental Reports. At the request of
the Administrative Agent from time to time, provide to the Lenders
within 60 days after such request, at the expense of the Borrower, an
environmental site assessment report for any of the properties of any
Loan Party or any Subsidiary of any Loan Party described in such
request, prepared by an environmental consulting firm acceptable to the
Administrative Agent, indicating the presence or absence of Hazardous
Materials and the estimated cost of any compliance, removal or remedial
action in connection with any Hazardous Materials on such properties;
without limiting the generality of the foregoing, if the Administrative
Agent determines at any time that a material risk exists that any such
report will not be provided within the time referred to above, the
Administrative Agent may retain an environmental consulting firm to
prepare such report at the expense of the Borrower, and each Loan Party
hereby grants and agrees to cause any of its Subsidiaries that owns any
property described in such request to grant at the time of such
request, to the Administrative Agent, the Lenders, such firm and any
agents or representatives thereof an irrevocable non-exclusive license,
subject to the rights of tenants, to enter onto their respective
properties to undertake such an assessment. All environmental reports
required under this Section 5.01(g) shall be initially limited to
"phase I" site audits unless the Administrative Agent reasonably
determines that further assessment and investigation is warranted.
(h) Keeping of Books. Keep, and cause each of its Subsidiaries
to keep, proper books of record and account, in which entries (which
shall be full and correct in all material respects) shall be made of
all financial transactions and the assets and business of each Loan
Party and each such Subsidiary in accordance with generally accepted
accounting principles in effect from time to time.
(i) Maintenance of Properties, Etc. Maintain and preserve, and
cause each of its Subsidiaries to maintain and preserve, all of its
properties that are used or useful in the conduct of its business in
good working order and condition, ordinary wear and tear excepted and
except that the Loan Parties may dispose of obsolete and worn-out
property or equipment, in the ordinary course of business.
62
(j) Compliance with Terms of Leaseholds. Make all payments and
otherwise perform all obligations in respect of all leases of real
property to which any Loan Party or any Subsidiary of a Loan Party is a
party, keep such leases in full force and effect and not allow such
leases to lapse or be terminated or any rights to renew such leases to
be forfeited or cancelled, notify the Administrative Agent of any
default by any party with respect to such leases and cooperate with the
Administrative Agent in all respects to cure any such default, and
cause each of its Subsidiaries to do so except, in any case, where the
failure to do so, either individually or in the aggregate, could not
have a Material Adverse Effect.
(k) Transactions with Affiliates. Conduct, and cause each of
its Subsidiaries to conduct, all transactions otherwise permitted under
the Loan Documents with any of their Affiliates on terms that are fair
and reasonable and no less favorable to such Loan Party or such
Subsidiary than it would obtain in a comparable arm's-length
transaction with a Person not an Affiliate.
(l) Cash Concentration Accounts. Maintain main cash
concentration accounts and Lockbox Accounts in accordance with the
Security Agreement into which all proceeds of Collateral are paid to
one or more banks acceptable to the Administrative Agent that have
accepted the assignment of such accounts to the Administrative Agent
pursuant to the Security Agreement.
(m) Covenant to Guarantee Obligations and Give Security. Upon
(x) the request of the Administrative Agent following the occurrence
and during the continuance of a Default, (y) the formation or
acquisition of any new Domestic Subsidiaries by the Borrower
(including, without limitation, any such formation or acquisition made
in connection with a Permitted Acquisition), or (z) the acquisition of
any property by any Loan Party (including, without limitation, any such
acquisition made in connection with a Permitted Acquisition), if such
property, in the judgment of the Administrative Agent, shall not
already be subject to a perfected first priority security interest in
favor of the Administrative Agent for the benefit of the Secured
Parties, then each Loan Party shall, in each case at such Loan Party's
expense:
(i) concurrently with the formation or acquisition of
a Domestic Subsidiary, cause each such Domestic Subsidiary,
and cause each direct and indirect parent of such Domestic
Subsidiary (if it has not already done so), to duly execute
and deliver to the Administrative Agent a guaranty supplement,
in substantially the form of Exhibit E hereto, guaranteeing
the other Loan Parties' obligations under the Loan Documents,
(ii) concurrently with each such formation or
acquisition, or within 10 days after such request, furnish to
the Administrative Agent a description of the real
63
and personal properties of the Loan Parties and their
respective Subsidiaries in detail reasonably satisfactory to
the Administrative Agent,
(iii) concurrently with each such formation or
acquisition, or within 15 days after such request, duly
execute and deliver, and cause each such Domestic Subsidiary
and each direct and indirect parent of such Domestic
Subsidiary (if it has not already done so) to duly execute and
deliver, to the Administrative Agent mortgages, pledges,
assignments, security agreement supplements and other security
agreements, as specified by and in form and substance
reasonably satisfactory to the Administrative Agent, securing
payment of all the Obligations of the applicable Loan Party,
such Domestic Subsidiary or such parent, as the case may be,
under the Loan Documents and constituting Liens on all such
properties,
(iv) concurrently with each such formation or
acquisition, or within 30 days after such request, take, and
cause such Domestic Subsidiary or such parent to take,
whatever action (including, without limitation, the recording
of mortgages, the filing or recording of Uniform Commercial
Code financing statements or other appropriate documents, the
giving of notices and the endorsement of notices on title
documents) may be necessary or advisable in the opinion of the
Administrative Agent to vest in the Administrative Agent (or
in any representative of the Administrative Agent designated
by it) valid and subsisting Liens on the properties purported
to be subject to the mortgages, pledges, assignments, security
agreement supplements and security agreements delivered
pursuant to this Section 5.01(m), enforceable against all
third parties in accordance with their terms,
(v) concurrently with each such formation or
acquisition, or within 60 days after such request, deliver to
the Administrative Agent, upon the request of the
Administrative Agent in its sole discretion, a signed copy of
a favorable opinion, addressed to the Administrative Agent and
the other Secured Parties, of counsel for the Loan Parties
acceptable to the Administrative Agent as to the matters
contained in clauses (i), (iii) and (iv) above, as to such
guaranties, guaranty supplements, mortgages, pledges,
assignments, security agreement supplements and security
agreements being legal, valid and binding obligations of each
Loan Party party thereto enforceable in accordance with their
terms, as to the matters contained in clause (iv) above, as to
such recordings, filings, notices, endorsements and other
actions being sufficient to create valid perfected Liens on
such properties, and as to such other matters as the
Administrative Agent may reasonably request,
(vi) as promptly as practicable after such request,
formation or acquisition, deliver, upon the reasonable request
of the Administrative Agent in its sole discretion, to the
Administrative Agent with respect to each parcel of real
property owned or held by the entity that is the subject of
such request, formation or
64
acquisition title reports, surveys and engineering, soils and
other reports, and environmental assessment reports, each in
scope, form and substance satisfactory to the Administrative
Agent, provided, however, that to the extent that any Loan
Party or any of its Domestic Subsidiaries shall have otherwise
received any of the foregoing items with respect to such real
property, such items shall, promptly after the receipt
thereof, be delivered to the Administrative Agent,
(vii) upon the occurrence and during the continuance
of an Event of Default, promptly cause to be deposited any and
all cash dividends paid or payable to it or any of its
Subsidiaries from any of its Subsidiaries from time to time
into a cash collateral account maintained with the
Administrative Agent, and with respect to all other dividends
paid or payable to it or any of its Subsidiaries from time to
time, promptly execute and deliver, or cause such Subsidiary
to promptly execute and deliver, as the case may be, any and
all further instruments and take or cause such Subsidiary to
take, as the case may be, all such other action as the
Administrative Agent may deem necessary or desirable in order
to obtain and maintain from and after the time such dividend
is paid or payable a perfected, first priority lien on and
security interest in such dividends, and
(viii) at any time and from time to time, promptly
execute and deliver any and all further instruments and
documents and take all such other action as the Administrative
Agent may reasonably deem necessary or desirable in obtaining
the full benefits of, or in perfecting and preserving the
Liens of, such guaranties, mortgages, pledges, assignments,
security agreement supplements and security agreements.
(n) As soon as possible but in any event no later than thirty
(30) days after the date hereof, (i) execute and deliver, and cause of
each of its applicable Subsidiaries to execute and deliver, to the
Administrative Agent deeds of trust, trust deeds, mortgages, leasehold
mortgages and leasehold deeds of trust, in form and substance
satisfactory to the Administrative Agent, and covering the properties
listed on Schedule 5.01(n) (together with each other mortgage delivered
pursuant to Section 5.01(m), in each case as amended, supplemented or
otherwise modified from time to time in accordance with their terms,
the "Mortgages"), and (ii) in connection with each such Mortgage,
deliver to the Administrative Agent each of the following:
(A) evidence that counterparts of the Mortgages have
been duly recorded in all filing or recording offices that the
Administrative Agent may deem necessary or desirable in order
to create a valid first and subsisting Lien on the property
described therein in favor of the Secured Parties and that all
filing and recording taxes and fees have been paid,
65
(B) fully paid American Land Title Association
Lender's Extended Coverage title insurance policies (the
"Mortgage Policies") in form and substance, with endorsements
and in amount acceptable to the Administrative Agent, issued,
coinsured and reinsured by title insurers acceptable to the
Administrative Agent, insuring the Mortgages to be valid first
and subsisting Liens on the property described therein, free
and clear of all defects (including, but not limited to,
mechanics' and materialmen's Liens) and encumbrances,
excepting only Permitted Liens of the type described in clause
(h) of the definition thereof, and providing for such other
affirmative insurance (including endorsements for future
advances under the Loan Documents and for mechanics' and
materialmen's Liens) and such coinsurance and direct access
reinsurance as the Administrative Agent may deem necessary or
desirable,
(C) American Land Title Association form surveys,
dated no more than 10 days before the date of such Mortgage,
certified to the Administrative Agent and the issuer of the
Mortgage Policies in a manner satisfactory to the
Administrative Agent by a land surveyor duly registered and
licensed in the States in which the property described in such
surveys is located and acceptable to the Administrative Agent,
showing all buildings and other improvements, any off-site
improvements, the location of any easements, parking spaces,
rights of way, building set-back lines and other dimensional
regulations and the absence of encroachments, either by such
improvements or on to such property, and other defects, other
than encroachments and other defects acceptable to the
Administrative Agent,
(D) an appraisal of each of the properties described
in the Mortgages complying with the requirements of the
Federal Financial Institutions Reform, Recovery and
Enforcement Act of 1989 which appraisals shall be from a
Person acceptable to the Lenders and otherwise in form and
substance satisfactory to the Lenders,
(E) engineering, soils and other reports as to the
properties described in the Mortgages, in form and substance
and from professional firms acceptable to the Administrative
Agent,
(F) the Assignments of Leases and Rents referred to
in the Mortgages, duly executed by the Borrower and each other
Collateral Grantor,
(G) such consents and agreements of lessors and other
third parties, and such estoppel letters and other
confirmations, as the Administrative Agent may deem necessary
or desirable,
(H) evidence of the insurance required by the terms
of the Mortgages,
66
(I) evidence that all other action that the
Administrative Agent may reasonably deem necessary or
desirable in order to create valid first and subsisting Liens
on the property described in the Mortgages has been taken, and
(J) an environmental assessment report, in form and
substance satisfactory to the Lenders, from an environmental
consulting firm acceptable to the Administrative Agent, as to
any hazards, costs or liabilities under Environmental Laws to
which any Loan Party may be subject, the amount and nature of
which and the Borrower's plans with respect to which shall be
acceptable to the Lenders, together with evidence, in form and
substance satisfactory to the Lenders, that all applicable
Environmental Laws shall have been complied with, it being
agreed that such reports shall be initially limited to "phase
I" site audits unless the Administrative Agent reasonably
determines that further assessment and investigation is
warranted.
Notwithstanding the foregoing, the obligation of the Borrower to provide
Mortgages in respect of properties listed on Schedule 5.01(n) that are leased by
the Borrower or, if applicable, its Subsidiaries shall be limited to using its
best efforts to obtain such Mortgages in the event that the lessor of such
properties has the right to consent to such Mortgage and refuses to give such
consent. In addition, as soon as possible after the date hereof, the Borrower
shall use its reasonable best efforts to obtain the following, each in form and
substance reasonably satisfactory to the Required Lenders:
(x) waivers from the lessors of each of the real properties
leased by the Borrower, acknowledging the lien of the Administrative
Agent on the Collateral located on such real properties, providing the
Lenders with access to such Collateral and such other matters as the
Administrative Agent may reasonably request;
(y) consents from the lessors to the terms of the Mortgages
encumbering real properties leased by the Borrower or, if applicable,
its Subsidiaries; and
(z) agreements from the lessors of the computer equipment
utilized by the Loan Parties allowing the Administrative Agent and the
Lenders access to the software and other information on such computers
if they have possession thereof.
(o) Chief Executive Officer. Ensure that the Borrower employs
a chief executive officer reasonably satisfactory to the Required
Lenders (it being agreed that the chief executive officer in office on
the date hereof is so satisfactory); provided that, if any Person
ceases to be a chief executive officer, such Person shall be replaced
by an interim chief executive officer within thirty days of such
cessation, and a permanent chief executive officer within ninety days
of such cessation, each such chief executive officer to be consented to
by the Required Lenders (such consent not to be unreasonably withheld
or delayed).
67
SECTION 5.02. Negative Covenants. So long as any Advance shall
remain unpaid or any Lender shall have any Commitment hereunder, each Loan Party
will not, at any time:
(a) Liens, Etc. Create, incur, assume or suffer to exist, or
permit any of its Subsidiaries to create, incur, assume or suffer to
exist, any Lien on or with respect to any of its properties of any
character (including, without limitation, accounts) whether now owned
or hereafter acquired, or sign or file or suffer to exist, or permit
any of its Subsidiaries to sign or file or suffer to exist, under the
Uniform Commercial Code of any jurisdiction, a financing statement that
names the Borrower or any of its Subsidiaries as debtor, or sign or
suffer to exist, or permit any of its Subsidiaries to sign or suffer to
exist, any security agreement authorizing any secured party thereunder
to file such financing statement, or assign, or permit any of its
Subsidiaries to assign, any accounts or other right to receive income,
excluding, however, from the operation of the foregoing restrictions
the following:
(i) Liens created under the Loan Documents;
(ii) Permitted Liens;
(iii) Liens existing on the date hereof and described
on Schedule 5.02(a) hereto;
(iv) purchase money Liens upon equipment acquired or
held by the Borrower or any of its Subsidiaries in the
ordinary course of business to secure the purchase price of
such equipment or to secure Debt incurred solely for the
purpose of financing the acquisition of any such equipment to
be subject to such Liens, or Liens existing on any such
equipment at the time of acquisition (other than any such
Liens created in contemplation of such acquisition that do not
secure the purchase price), or extensions, renewals or
replacements of any of the foregoing for the same or a lesser
amount; provided, however, that no such Lien shall extend to
or cover any property other than the equipment being acquired,
and no such extension, renewal or replacement shall extend to
or cover any property not theretofore subject to the Lien
being extended, renewed or replaced; and provided further that
(A) the aggregate principal amount of the Debt secured by
Liens permitted by this clause (iv) shall not exceed the
aggregate amount permitted under Section 5.02(b)(ii)(B) at any
time outstanding and (B) at the time of acquisition of any
such equipment subject thereto, the aggregate principal amount
of the Debt incurred in connection with such acquisition shall
not exceed 95% of the cost of such equipment, or of the then
fair value thereof, whichever shall be less and that any such
Debt shall not otherwise be prohibited by the terms of the
Loan Documents; and
68
(v) Liens arising in connection with Capitalized
Leases permitted under Section 5.02(b)(ii)(B); provided that
no such Lien shall extend to or cover any Collateral or assets
other than the assets subject to such Capitalized Leases; and
(b) Debt. Create, incur, assume or suffer to exist, or permit
any of its Subsidiaries to create, incur, assume or suffer to exist,
any Debt other than:
(i) in the case of any of its Subsidiaries, Debt owed
to the Borrower or to a wholly-owned Subsidiary of the
Borrower; provided that all instruments evidencing any such
Debt have been pledged and delivered to the Administrative
Agent pursuant to the Security Agreement; and
(ii) in the case of the Borrower and any of its
Subsidiaries,
(A) Debt under the Loan Documents,
(B) (i) Debt secured by Liens permitted by
Section 5.02(a)(iv), (ii) Capitalized Leases and in
the case of Capitalized Leases to which any Subsidiary
of the Borrower is a party, Debt of the Borrower of
the type described in clause (i) of the definition of
"Debt" guaranteeing the Obligations of such Subsidiary
under such Capitalized Leases and (iii) unsecured Debt
incurred in the ordinary course of business for the
deferred purchase price of property or services,
maturing within one year from the date created;
provided that all Debt (including Capitalized Leases)
permitted under this clause (B) shall not exceed in
the aggregate $1,000,000 at any time outstanding,
(C) the Surviving Debt,
(D) indorsement of negotiable instruments
for deposit or collection or similar transactions in
the ordinary course of business, and
(E) Existing Debt; provided that all such
Existing Debt that is not Surviving Debt is paid in
full on the Funding Date.
(c) Mergers, Etc. Merge into or consolidate with any Person or
permit any Person to merge into it, or permit any of its Subsidiaries
to do so, except that (i) any Subsidiary of the Borrower may merge into
or consolidate with any other Subsidiary of the Borrower provided that,
in the case of any such merger or consolidation, the Person formed by
such merger or consolidation shall be a wholly-owned Subsidiary of the
Borrower and (ii) any of the Borrower's Subsidiaries may merge into the
Borrower and (iii) each of the Borrower and any of its Subsidiaries may
permit any other Person to merge into or consolidate with it;
69
provided, however, that in each case, immediately after giving effect
thereto, no event shall occur and be continuing that constitutes a
Default and, in the case of any such merger to which the Borrower is a
party, the Borrower is the surviving corporation.
(d) Sales, Etc. of Assets. Sell, lease, transfer or otherwise
dispose of, or permit any of its Subsidiaries to sell, lease, transfer
or otherwise dispose of, any assets or grant any option or other right
to purchase, lease or otherwise acquire any assets, except:
(i) sales of Inventory, or obsolete or worn-out
equipment in the ordinary course of its business, and
(ii) in a transaction authorized by subsection (c) of
this Section.
(e) Investments in Other Persons. Make or hold, or permit any
of its Subsidiaries to make or hold, any Investment in any Person other
than:
(i) Investments by the Borrower in its Subsidiaries
outstanding on the date hereof and additional investments by
the Borrower in its wholly-owned Subsidiaries;
(ii) loans and advances to employees in the ordinary
course of the business of the Borrower and its Subsidiaries
as presently conducted in an aggregate principal amount not
to exceed $100,000 at any time outstanding;
(iii) Investments by the Borrower and its
Subsidiaries in Cash Equivalents in an aggregate principal
amount not to exceed $1,500,000 at any time outstanding;
(iv) Investments consisting of intercompany Debt
permitted under Section 5.02(b)(i);
(v) Investments existing on the date hereof and
described on Schedule 5.02(e) hereto;
(vi) Investments consisting of accounts receivable
from customers rising in the ordinary course of business; and
(vii) other Investments consisting of the acquisition
by the Borrower or any Loan Party of all of the Equity
Interests in a corporation or all or substantially all of the
assets of any Person or any assets of a Person constituting a
line of business or division of such Person; provided that
with respect to Investments (hereinafter, "Permitted
Acquisitions" made under this clause (vii) each of the
following conditions shall be satisfied:
70
(A) the Borrower shall have delivered to the
Administrative Agent a duly-completed and executed
certificate, in form and substance satisfactory to
the Administrative Agent (each, an "Acquisition
Certificate"), certifying that (1) the financial
conditions referred to in clause (C) below with
respect to the proposed Permitted Acquisition will be
satisfied, (2) no Default has occurred and is
continuing or will result from the consummation of
the proposed Permitted Acquisition, (3) all amounts
and other consideration required to be paid, and all
Obligations and liabilities required to be assumed,
to consummate the proposed Permitted Acquisition and
(4) all other conditions contained herein to the
consummation of the proposed Permitted Acquisition
will be satisfied, together with (x) a business
description and summary of terms of the proposed
Permitted Acquisition, and (y) evidence that the
proposed Permitted Acquisition is being made pursuant
to a written agreement approved by all necessary
parties including the Borrower and the Person (the
"Acquisition Prospect") whose stock or assets will be
acquired in the proposed Permitted Acquisition;
(B) the Administrative Agent shall have
received, in each case in form and substance
reasonably satisfactory to the Administrative Agent
(including all assumptions used in the preparation
thereof), with copies for each Lender, pro forma
Consolidated balance sheets, statements of income and
cash flows and projections of the Borrower and its
Subsidiaries, calculated as of a date reasonably near
to the date of the consummation proposed Permitted
Acquisition for the three-year period immediately
succeeding such date giving effect to the
consummation of such Permitted Acquisition and all
transactions contemplated in connection therewith;
(C) the Borrower shall be in compliance with
all financial covenants contained in Section 5.04
hereof as projected by the Borrower for the period of
four consecutive Fiscal Quarters beginning on the
first day of the Fiscal Quarter in which the date of
the consummation of the proposed Permitted
Acquisition occurs;
(D) the proposed Permitted Acquisition shall
be consummated in accordance with Requirements of
Law, and all material consents and approvals
necessary or desirable to the consummation and the
business operations of the Loan Parties effect
thereto shall have been obtained, including, without
limitation, all consents and approvals of
Governmental Authorities and, if applicable,
landlords;
(E) no Default shall exist at the time of
the consummation of the proposed Permitted
Acquisition or would result therefrom;
71
(F) the proposed Acquisition Prospect (or
its Board of Directors or equivalent governing body)
shall not have (i) announced it will oppose the
proposed Permitted Acquisition or (ii) commenced any
action, suit or proceeding which alleges that the
proposed Permitted Acquisition violates, or will
violate, any Requirement of Law or contractual
obligation or otherwise contesting the proposed
Permitted Acquisition or any of the terms thereof;
(G) if either (1) the sum of (A) the
product of (x) the aggregate number of shares of
Borrower Common Stock issued as consideration for all
Permitted Acquisitions theretofore consummated
multiplied by (y) the Average Market Price of such
shares as at the respective dates on which they were
issued plus (B) the product of (x) the aggregate
number of shares of Borrower Common Stock to be
issued as consideration for the proposed Permitted
Acquisition multiplied by (y) the Average Market
Price of such Share as at the date immediately prior
to the date on which the proposed Permitted
Acquisition is consummated, exceeds $5,000,000 or (2)
the sum of the total consideration for all Permitted
Acquisitions theretofore consummated plus the
consideration to be paid in connection with the
proposed Permitted Acquisition (including, in each
case, all cash and noncash purchase price,
liabilities assumed, deferred or financed purchase
price, purchase price characterized as noncompetition
payments and the like, but excluding the value of
shares of Borrower Common Stock issued as
consideration for such Permitted Acquisition) exceeds
$5,000,000, the Required Lenders shall have consented
in writing to such proposed Permitted Acquisition;
(H) any Subsidiary of any Loan Party
acquired or created in connection with the proposed
Permitted Acquisition shall be a wholly-owned
Subsidiary of such Loan Party;
(I) any business acquired or invested in
pursuant to this clause (vi) shall be in the same
line of business as the business of the Loan Parties
immediately prior to the consummation of the proposed
Permitted Acquisition; and
(J) concurrently with the consummation of
the proposed Permitted Acquisition, all of the
requirements of Section 5.01(m) shall have been
complied with.
(f) Dividends, Etc. Declare or pay any dividends, purchase,
redeem, retire, defease or otherwise acquire for value any of its
capital stock or any warrants, rights or
72
options to acquire such capital stock, now or hereafter outstanding,
return any capital to its stockholders as such, make any distribution
of assets, capital stock, warrants, rights, options, obligations or
securities to its stockholders as such, or permit any of its
Subsidiaries to do any of the foregoing or permit any of its
Subsidiaries to purchase, redeem, retire, defease or otherwise acquire
for value any capital stock of the Borrower or any warrants, rights or
options to acquire such capital stock or to issue or sell any capital
stock or any warrants, rights or options to acquire such capital stock,
except that, so long as no Default shall have occurred and be
continuing at the time of any action described in clauses (i) and (ii)
below or would result therefrom, (i) the Borrower may declare and pay
dividends and distributions payable only in common stock of the
Borrower, and (ii) any wholly-owned Subsidiary of the Borrower may (A)
declare and pay cash dividends to the Borrower and (B) declare and pay
cash dividends to any other wholly-owned Subsidiary of the Borrower of
which it is a Subsidiary.
(g) Change in Nature of Business. Make, or permit any of its
Subsidiaries to make, any material change in the nature of its business
as carried on at the date hereof.
(h) Charter Amendments. Amend, or permit any of its
Subsidiaries to amend, its certificate of incorporation or bylaws,
except for amendments to its certificate of incorporation which
increase the number of shares of common stock authorized for issuance.
(i) Accounting Changes. Make or permit, or permit any of its
Subsidiaries to make or permit, any change in (i) accounting policies
or reporting practices, except as required by generally accepted
accounting principles or (ii) Fiscal Year.
(j) Prepayments, Etc. of Debt. Prepay, redeem, purchase,
defease or otherwise satisfy prior to the scheduled maturity thereof in
any manner, or make any payment in violation of any subordination terms
of, any Debt, other than (i) the prepayment of the Working Capital
Advances in accordance with the terms of this Agreement and (ii)
regularly scheduled or required repayments or redemptions of Surviving
Debt, or amend, modify or change in any manner any term or condition of
any Surviving Debt, or permit any of its Subsidiaries to do any of the
foregoing other than to prepay any Debt payable to the Borrower.
(k) Negative Pledge. Enter into or suffer to exist, or permit
any of its Subsidiaries to enter into or suffer to exist, any agreement
prohibiting or conditioning the creation or assumption of any Lien upon
any of its property or assets other than in favor of the Secured
Parties.
(l) Partnerships, Etc. Become a general partner in any general
or limited partnership or joint venture, or permit any of its
Subsidiaries to do so, other than any Subsidiary the sole assets of
which consist of its interest in such partnership or joint venture.
73
(m) Speculative Transactions. Engage, or permit any of its
Subsidiaries to engage, in any transaction involving commodity options
or futures contracts or any similar speculative transactions including,
without limitation, take-or-pay contracts.
(n) Capital Expenditures. Make, or permit any of its
Subsidiaries to make, any Capital Expenditures that would cause the
aggregate of all such Capital Expenditures made by the Borrower and its
Subsidiaries to exceed (i) during the period from the date hereof until
June 30, 1999, $1,500,000 and (ii) in any Fiscal Year of the Borrower,
commencing with the Fiscal Year ended June 30, 2000, $3,000,000.
SECTION 5.03. Reporting Requirements. So long as any Advance
shall remain unpaid or any Lender shall have any Working Capital Commitment
hereunder, the Loan Parties will furnish to the Administrative Agent and each
Lender:
(a) Default Notice. As soon as possible and in any event
within two days after the occurrence of each Default or any event,
development or occurrence reasonably likely to have a Material Adverse
Effect continuing on the date of such statement, a statement of
Responsible Officer of such Loan Party setting forth details of such
Default and the action that such Loan Party has taken and proposes to
take with respect thereto.
(b) Monthly Financials. As soon as available and in any event
within 45 days after the end of each month, a Consolidated balance
sheet of the Borrower and its Subsidiaries as of the end of such month
and a Consolidated statement of income and a Consolidated statement of
cash flows of the Borrower and its Subsidiaries for the period
commencing at the end of the previous month and ending with the end of
such month and a Consolidated statement of income and a Consolidated
statement of cash flows of the Borrower and its Subsidiaries for the
period commencing at the end of the previous Fiscal Year and ending
with the end of such month, setting forth in each case in comparative
form the corresponding figures for the corresponding month of the
preceding Fiscal Year, all in reasonable detail and duly certified by
the chief executive officer, president or chief financial officer of
the Borrower.
(c) Quarterly Financials. As soon as available and in any
event within 45 days after the end of each of the first three quarters
of each Fiscal Year, a Consolidated balance sheet of the Borrower and
its Subsidiaries as of the end of such quarter and Consolidated
statement of income and a Consolidated statement of cash flows of the
Borrower and its Subsidiaries for the period commencing at the end of
the previous fiscal quarter and ending with the end of such fiscal
quarter and a Consolidated statement of income and a Consolidated
statement of cash flows of the Borrower and its Subsidiaries for the
period commencing at the end of the previous Fiscal Year and ending
with the end of such quarter, setting forth in each case in comparative
form the corresponding figures for the corresponding period of the
preceding Fiscal Year, all in reasonable detail and duly certified
74
(subject to year-end audit adjustments and the absence of footnotes) by
the chief financial officer of the Borrower as having been prepared in
accordance with GAAP, together with (i) a certificate of said officer
stating that no Default has occurred and is continuing or, if a Default
has occurred and is continuing, a statement as to the nature thereof
and the action that the Borrower has taken and proposes to take with
respect thereto and (ii) a schedule in form satisfactory to the
Administrative Agent of the computations used by the Borrower in
determining compliance with the covenants contained in Sections 5.04(a)
through (d), provided that in the event of any change in GAAP used in
the preparation of such financial statements, the Borrower shall also
provide, if necessary for the determination of compliance with Section
5.04, a statement of reconciliation conforming such financial
statements to GAAP.
(d) Annual Financials. As soon as available and in any event
within 90 days after the end of each Fiscal Year, a copy of the annual
audit report for such year for the Borrower and its Subsidiaries,
including therein a Consolidated balance sheet of the Borrower and its
Subsidiaries as of the end of such Fiscal Year and a Consolidated
statement of income and a Consolidated statement of cash flows of the
Borrower and its Subsidiaries for such Fiscal Year, in each case
accompanied by an opinion acceptable to the Required Lenders of
Deloitte & Touche LLP or other independent public accountants of
recognized standing acceptable to the Required Lenders, together with
(i) a certificate of such accounting firm to the Lenders stating that
in the course of the regular audit of the business of the Borrower and
its Subsidiaries, which audit was conducted by such accounting firm in
accordance with generally accepted auditing standards, such accounting
firm has obtained no knowledge that a Default has occurred and is
continuing, or if, in the opinion of such accounting firm, a Default
has occurred and is continuing, a statement as to the nature thereof,
(ii) a schedule in form satisfactory to the Administrative Agent of the
computations used by such accountants in determining, as of the end of
such Fiscal Year, compliance with the covenants contained in Sections
5.04(a) through (d), provided that in the event of any change in GAAP
used in the preparation of such financial statements, the Borrower
shall also provide, if necessary for the determination of compliance
with Section 5.04, a statement of reconciliation conforming such
financial statements to GAAP and (iii) a certificate of the chief
financial officer of the Borrower stating that no Default has occurred
and is continuing or, if a Default has occurred and is continuing, a
statement as to the nature thereof and the action that the Borrower has
taken and proposes to take with respect thereto.
(e) Annual Forecasts. As soon as available and in any event no
later than 15 days before the end of each Fiscal Year, forecasts
prepared by management of the Borrower, in form satisfactory to the
Administrative Agent, of balance sheets, income statements and cash
flow statements on a monthly basis for the Fiscal Year following such
Fiscal Year then ended and on an annual basis for each Fiscal Year
thereafter until the Termination Date.
75
(f) ERISA Events and ERISA Reports. Promptly and in any event
within 10 days after any Loan Party or any ERISA Affiliate knows or has
reason to know that any ERISA Event has occurred, a statement of the
chief financial officer of the Borrower describing such ERISA Event and
the action, if any, that such Loan Party or such ERISA Affiliate has
taken and proposes to take with respect thereto and (ii) on the date
any records, documents or other information must be furnished to the
PBGC with respect to any Plan pursuant to Section 4010 of ERISA, a copy
of such records, documents and information.
(g) Plan Terminations. Promptly and in any event within two
Business Days after receipt thereof by any Loan Party or any ERISA
Affiliate, copies of each notice from the PBGC stating its intention to
terminate any Plan or to have a trustee appointed to administer any
Plan.
(h) Plan Annual Reports. Promptly and in any event within 30
days after the filing thereof with the Internal Revenue Service, copies
of each Schedule B (Actuarial Information) to the annual report (Form
5500 Series) with respect to each Plan.
(i) Multiemployer Plan Notices. Promptly and in any event
within five Business Days after receipt thereof by any Loan Party or
any ERISA Affiliate from the sponsor of a Multiemployer Plan, copies of
each notice concerning (i) the imposition of Withdrawal Liability by
any such Multiemployer Plan, (ii) the reorganization or termination,
within the meaning of Title IV of ERISA, of any such Multiemployer Plan
or (iii) the amount of liability incurred, or that may be incurred, by
such Loan Party or any ERISA Affiliate in connection with any event
described in clause (i) or (ii).
(j) Litigation. Promptly after the commencement thereof,
notice of all actions, suits, investigations, litigation and
proceedings before any court or governmental department, commission,
board, bureau, agency or instrumentality, domestic or foreign,
affecting any Loan Party or any of its Subsidiaries of the type
described in Section 4.01(j).
(k) Securities Reports. Promptly after the sending or filing
thereof, copies of all proxy statements, financial statements and
reports that any Loan Party or any of its Subsidiaries sends to its
stockholders, and copies of all regular, periodic and special reports,
and all registration statements, that any Loan Party or any of its
Subsidiaries files with the Securities and Exchange Commission or any
governmental authority that may be substituted therefor, or with any
national securities exchange.
(l) Agreement Notices. Promptly upon receipt thereof, copies
of all notices, requests and other documents received by any Loan Party
under or pursuant to any indenture, loan or credit or similar agreement
regarding or related to any breach or default by any party thereto or
any other event that could materially impair the value of the interests
or the rights
76
of any Loan Party or otherwise have a Material Adverse Effect and
copies of any amendment, modification or waiver of any provision of any
indenture, loan or credit or similar agreement.
(m) Revenue Agent Reports. Within 10 days after receipt,
copies of all Revenue Agent Reports (Internal Revenue Service Form
886), or other written proposals of the Internal Revenue Service, that
propose, determine or otherwise set forth positive adjustments to the
Federal income tax liability of the affiliated group (within the
meaning of Section 1504(a)(1) of the Internal Revenue Code) of which
the Loan Parties are a member aggregating $100,000 or more.
(n) Tax Certificates. Promptly, and in any event within five
Business Days after the due date (with extensions) for filing the final
Federal income tax return in respect of each taxable year, a
certificate (a "Tax Certificate"), signed by the President or the chief
financial officer of the Borrower, stating that the common parent of
the affiliated group (within the meaning of Section 1504(a)(1) of the
Internal Revenue Code) of which the Loan Parties are a member has paid
to the Internal Revenue Service or other taxing authority, or to any
Loan Party, the full amount that such affiliated group is required to
pay in respect of Federal income tax for such year and that the Loan
Parties have received any amounts payable to them, and have not paid
amounts in respect of taxes (Federal, state, local or foreign) in
excess of the amount they are required to pay, under the Tax Agreements
in respect of such taxable year.
(o) Environmental Conditions. Promptly after the assertion or
occurrence thereof, notice of any Environmental Action against or of
any noncompliance by any Loan Party or any of its Subsidiaries with any
Environmental Law or Environmental Permit that (i) could reasonably be
expected to have a Material Adverse Effect or (ii) cause any property
described in the Mortgages to be subject to any restrictions on
ownership, occupancy, use or transferability under any Environmental
Law.
(p) Real Property. As soon as available and in any event
within 30 days after the end of each Fiscal Year, a report
supplementing Schedules 4.01(z) hereto, including an identification of
all real and leased property disposed of by the Borrower or any of its
Subsidiaries during such Fiscal Year, a list and description (including
the street address, county or other relevant jurisdiction, state,
record owner, book value thereof, and in the case of leases of
property, lessor, lessee, expiration date and annual rental cost
thereof) of all real property acquired or leased during such Fiscal
Year and a description of such other changes in the information
included in such Schedules as may be necessary for such Schedules to be
accurate and complete.
(q) Insurance. As soon as available and in any event within 30
days after the end of each Fiscal Year, a report summarizing the
insurance coverage (specifying type, amount
77
and carrier) in effect for the Borrower and its Subsidiaries and
containing such additional information as any Lender (through the
Administrative Agent) may reasonably specify.
(r) Year 2000 Compliance. Promptly upon the discovery or
determination thereof by any Loan Party, notice of any computer
application (including any such computer application of its or any of
its Subsidiary's suppliers, vendors and customers) that is material to
its or any of its Subsidiaries' business, financial condition or
operations and will not be able on a timely basis to perform properly
date-sensitive functions for all dates before and after January 1,
2000, except to the extent that such failure, either individually or in
the aggregate could not reasonably be expected to have a Material
Adverse Effect.
(s) Other Information. Such other information respecting the
business, condition (financial or otherwise), operations, performance,
properties or prospects of any Loan Party or any of its Subsidiaries as
any Lender (through the Administrative Agent) may from time to time
reasonably request.
SECTION 5.04. Financial Covenants. So long as any Advance
shall remain unpaid or any Lender shall have any Commitment hereunder, the Loan
Parties will:
(a) Minimum Consolidated EBITDA. Cause (i) the product of (A)
a factor of two times (B) Consolidated EBITDA of the Borrower and its
Subsidiaries for the six-month period ending March 31, 1999 not to be
less than $8,000,000, (ii) the quotient of (A) the product of (1) a
factor of four times (2) Consolidated EBITDA of the Borrower and its
Subsidiaries for the nine-month period ending June 30, 1999 divided by
(B) a factor of three, not to be less than $8,000,000, and (iii)
Consolidated EBITDA of the Borrower and its Subsidiaries for each
Measurement Period ending on any date after June 30, 1999 not to be
less than the amount set forth below for such period:
PERIOD ENDING AMOUNT
------------- ------
9/30/99 - $ 8,500,000
12/31/99 - $ 9,000,000
3/31/00 - $10,000,000
6/30/00 - $11,000,000
9/30/00 - $11,500,000
12/31/00 - $12,000,000
3/31/01 - $13,000,000
6/30/01 - $14,000,000
Thereafter $14,000,000
78
(b) Net Worth. Maintain at all times an excess of Consolidated
net worth over the sum of (i) $45,000,000 plus (ii) 50% of cumulative
Consolidated Net Income since March 31, 1999.
(c) Leverage Ratio. Maintain at all times a ratio of
Consolidated Debt to Consolidated EBITDA, in each case of the Borrower
and its Subsidiaries and calculated with respect to each Measurement
Period, of not greater than 2.00 to 1.00; provided that Consolidated
EBITDA for periods ending on or prior to March 31, 1999 shall be
calculated in accordance with clause (i)(A) of Section 5.04(a), and for
periods ending on or prior to June 30, 1999 shall be calculated in
accordance with clause (ii)(A) of Section 5.04(a).
(d) Interest Coverage Ratio. Maintain at all times a ratio of
Consolidated EBITDA to Consolidated Interest Expense, in each case of
the Borrower and its Subsidiaries and calculated with respect to each
Measurement Period, of not less than 3.00 to 1.00; provided that (i)
Consolidated EBITDA for periods ending on or prior to March 31, 1999
shall be calculated in accordance with clause (i)(A) of Section
5.04(a), and for periods ending on or prior to June 30, 1999 shall be
calculated in accordance with clause (ii)(A) of Section 5.04(a) and
(ii) Consolidated Interest Expense for periods ending on or prior to
the first anniversary of the Funding Date shall be calculated as
follows: (A) all such Consolidated Interest Expense attributable to
periods prior to the Funding Date shall be disregarded and (B) all such
Consolidated Interest Expense attributable to periods after the Funding
Date shall be multiplied by a factor equal to a fraction the numerator
of which is 365 and the denominator of which is the number of days
since the Funding Date.
(c) Leverage Ratio. Maintain at all times a ratio of
Consolidated Debt to Consolidated EBITDA, in each case, of the Borrower
and its Subsidiaries of not more than 2.00 to 1.00.
(d) Excluded Assigned Agreements. Not permit at any time the
aggregate amount of gross revenues received by the Loan Parties under
the Assigned Contracts referred to in the definition of Excluded
Assigned Agreements during any one year period to be more than
thirty-five percent of the aggregate amount of all gross revenues
received by the Loan Parties during such one year period.
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ARTICLE VI
EVENTS OF DEFAULT
SECTION 6.01. Events of Default. If any of the following
events ("Events of Default") shall occur and be continuing:
(a) (i) the Borrower shall fail to pay any principal of any
Working Capital Advance when the same shall become due and payable,
whether by scheduled maturity or at a date fixed for prepayment or by
acceleration, demand or otherwise, or (ii) the Borrower shall fail to
pay any interest on any Working Capital Advance or any fee owing under
or in respect of this Agreement, or any Loan Party shall fail to make
any other payment under or in respect of any Loan Document, whether by
scheduled maturity or at a date fixed for payment or prepayment or by
acceleration, demand or otherwise, in each case under this clause (ii)
when the same becomes due and payable; or
(b) any representation or warranty made by any Loan Party (or
any of its officers) under or in connection with any Loan Document
shall prove to have been incorrect in any material respect when made or
deemed made; or
(c) (i) the Borrower shall fail to perform or observe any
term, covenant or agreement contained in Section 2.13, 5.01(d),
5.01(e), 5.01(g), 5.01(k), 5.01(l), 5.01(m), 5.01(n), 5.01(o), 5.02,
5.03, 5.04 or Article VII; or
(d) any Loan Party shall fail to perform or observe any term,
covenant or agreement contained in any of the Loan Documents on its
part to be performed or observed that is not otherwise referred to in
this Section 6.01 if such failure shall remain unremedied for at least
twenty (20) days after the earlier of the date on which (i) a
Responsible Officer of any of the Loan Parties first becomes aware of
such failure and (ii) written notice thereof shall have been given to
the Borrower by the Administrative Agent or any of the Lenders; or
(e) (i) any Loan Party shall fail to pay any principal of,
premium or interest on, or any other amount payable in respect of, one
or more items of Debt of the Loan Parties (excluding Debt outstanding
hereunder) that is outstanding in an aggregate principal amount (or, in
the case of any Hedge Agreement, that has an Agreement Value) of at
least $100,000 when the same becomes due and payable (whether by
scheduled maturity, required prepayment, acceleration, demand or
otherwise), and such failure shall continue after the applicable grace
period, if any, specified in the agreements or instruments relating to
all such Debt; or (ii) any other event shall occur or condition shall
exist under the agreements or instruments relating to one or more items
of Debt of the Loan Parties (excluding Debt outstanding hereunder) that
is outstanding (or under which one or more Persons have a
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commitment to extend credit) in an aggregate principal amount (or, in
the case of any Hedge Agreement, that has an Agreement Value) of at
least $100,000, and such other event or condition shall continue after
the applicable grace period, if any, specified in all such agreements
or instruments, if the effect of such event or condition is to
accelerate, or to permit the acceleration of, the maturity of such Debt
or otherwise to cause, or to permit the holder thereof to cause, such
Debt to mature; or (iii) one or more items of Debt of the Loan Parties
(excluding Debt outstanding hereunder) that is outstanding (or under
which one or more Persons have a commitment to extend credit) in an
aggregate principal amount (or, in the case of any Hedge Agreement,
that has an Agreement Value) of at least $100,000 shall be declared to
be due and payable or required to be prepaid or redeemed (other than by
a regularly scheduled or required prepayment or redemption), purchased
or defeased, or an offer to prepay, redeem, purchase or defease such
Debt shall be required to be made, in each case prior to the stated
maturity thereof; or
(f) any Loan Party shall generally not pay its debts as such
debts become due, or shall admit in writing its inability to pay its
debts generally, or shall make a general assignment for the benefit of
creditors; or any proceeding shall be instituted by or against any Loan
Party seeking to adjudicate it a bankrupt or insolvent, or seeking
liquidation, winding up, reorganization, arrangement, adjustment,
protection, relief, or composition of it or its debts under any law
relating to bankruptcy, insolvency or reorganization or relief of
debtors, or seeking the entry of an order for relief or the appointment
of a receiver, trustee, or other similar official for it or for any
substantial part of its property and, in the case of any such
proceeding instituted against it (but not instituted by it) that is
being diligently contested by it in good faith, either such proceeding
shall remain undismissed or unstayed for a period of at least 60 days
or any of the actions sought in such proceeding (including, without
limitation, the entry of an order for relief against, or the
appointment of a receiver, trustee, custodian or other similar official
for, it or any substantial part of its property) shall occur; or any
event or action analogous to or having a substantially similar effect
to any of the events or actions set forth above in this Section 6.01(f)
(other than a solvent reorganization) shall occur under the
Requirements of Law of any jurisdiction applicable to any Loan Party;
or any Loan Party shall take any corporate, partnership, limited
liability company or other similar action to authorize any of the
actions set forth above in this Section 6.01(f); or
(g) one or more judgments or orders for the payment of money
in excess of $100,000 in the aggregate shall be rendered against one or
more of the Loan Parties and shall remain unsatisfied and either (i)
enforcement proceedings shall have been commenced by any creditor upon
any such judgment or order or (ii) there shall be any period of at
least ten days during which a stay of enforcement of any such judgment
or order, by reason of a pending appeal or otherwise, shall not be in
effect; provided, however, that any such judgment or order shall not
give rise to an Event of Default under this Section 6.01(g) if and for
so long as (A) the amount of such judgment or order is covered by a
valid and binding policy of insurance between the defendant and the
insurer covering full payment thereof and (B) such
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insurer has been notified, and has not disputed the claim made for
payment, of the amount of such judgment or order; or
(h) one or more nonmonetary judgments or orders (including,
without limitation, writs or warrants of attachment, garnishment,
execution, distraint or similar process) shall be rendered against any
Loan Party that, either individually or in the aggregate, could
reasonably be expected to have a Material Adverse Effect, and there
shall be any period of at least ten days during which a stay of
enforcement of any such judgment or order, by reason of a pending
appeal or otherwise, shall not be in effect; or
(i) any provision of any Loan Document after delivery thereof
pursuant to Section 3.01 or Section 5.01(m) or Section 5.01(n) shall
for any reason (other than pursuant to the terms thereof) cease to be
valid and binding on or enforceable against any Loan Party intended to
be a party thereto, or any such Loan Party shall so state in writing;
or
(j) any Collateral Document after delivery thereof pursuant to
Section 3.01 or Section 5.01(m) or Section 5.01(n) shall for any reason
(other than pursuant to the terms thereof) cease to create a valid and
perfected first priority lien on and security interest in the
Collateral purported to be covered thereby; or
(k) any ERISA Event shall have occurred with respect to a Plan
and the sum (determined as of the date of occurrence of such ERISA
Event) of the Insufficiency of such Plan and the Insufficiency of any
and all other Plans with respect to which an ERISA Event shall have
occurred and then exist (or the liability of the Loan Parties and the
ERISA Affiliates related to such ERISA Event) exceeds $100,000; or
(l) any Loan Party or any ERISA Affiliate shall have been
notified by the sponsor of a Multiemployer Plan that it has incurred
Withdrawal Liability to such Multiemployer Plan in an amount that, when
aggregated with all other amounts required to be paid to Multiemployer
Plans by the Loan Parties and the ERISA Affiliates as Withdrawal
Liability (determined as of the date of such notification), exceeds
$100,000; or
(m) any Loan Party or any ERISA Affiliate shall have been
notified by the sponsor of a Multiemployer Plan that such Multiemployer
Plan is in reorganization or is being terminated, within the meaning of
Title IV of ERISA, and as a result of such reorganization or
termination the aggregate annual contributions of the Loan Parties and
the ERISA Affiliates to all Multiemployer Plans that are then in
reorganization or being terminated have been or will be increased over
the amounts contributed to such Multiemployer Plans for the plan years
of such Multiemployer Plans immediately preceding the plan year in
which such reorganization or termination occurs by an amount exceeding
$100,000; or
(n) a Change of Control shall occur;
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then, and in any such event, the Administrative Agent (i) shall at the request,
or may with the consent, of the Required Lenders, by notice to the Borrower,
declare the Commitments of each Lender and the obligation of each Lender to make
Working Capital Advances to be terminated, whereupon the same shall forthwith
terminate, and (ii) shall at the request, or may with the consent, of the
Required Lenders, by notice to the Borrower, declare the Working Capital Notes,
all interest thereon and all other amounts payable under this Agreement and the
other Loan Documents to be forthwith due and payable, whereupon the Working
Capital Notes, all such interest and all such amounts shall become and be
forthwith due and payable, without presentment, demand, protest or further
notice of any kind, all of which are hereby expressly waived by the Borrower;
provided, however, that in the event of an actual or deemed entry of an order
for relief with respect to the Borrower under the Federal Bankruptcy Code, (1)
the Commitments of each Lender and the obligation of each Lender to make Working
Capital Advances and (2) the Working Capital Notes, all such interest and all
such amounts shall automatically become and be due and payable, without
presentment, demand, protest or any notice of any kind, all of which are hereby
expressly waived by the Borrower.
ARTICLE VII
GUARANTY
SECTION 7.01. Guaranty; Limitation of Liability. (a) Each
Guarantor, jointly and severally, hereby absolutely, unconditionally and
irrevocably guarantees the punctual payment when due, whether at scheduled
maturity or on any date of a required prepayment or by acceleration, demand or
otherwise, of all Obligations of each other Loan Party now or hereafter existing
under or in respect of the Loan Documents (including, without limitation, any
extensions, modifications, substitutions, amendments or renewals of any or all
of the foregoing Obligations), whether direct or indirect, absolute or
contingent, and whether for principal, interest, premiums, fees, indemnities,
contract causes of action, costs, expenses or otherwise (such Obligations being
the "Guaranteed Obligations"), and agrees to pay any and all expenses
(including, without limitation, reasonable fees and expenses of counsel)
incurred by the Administrative Agent or any other Secured Party in enforcing any
rights under this Guaranty or any other Loan Document. Without limiting the
generality of the foregoing, each Guarantor's liability shall extend to all
amounts that constitute part of the Guaranteed Obligations and would be owed by
any other Loan Party to any Secured Party under or in respect of the Loan
Documents but for the fact that they are unenforceable or not allowable due to
the existence of a bankruptcy, reorganization or similar proceeding involving
such other Loan Party.
(b) Each Guarantor, and by its acceptance of this Guaranty,
the Administrative Agent and each other Secured Party, hereby confirms that it
is the intention of all such Persons that this Guaranty and the Obligations of
each Guarantor hereunder not constitute a fraudulent transfer or conveyance for
purposes of Bankruptcy Law, the Uniform Fraudulent Conveyance Act, the
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Uniform Fraudulent Transfer Act or any similar foreign, federal or state law to
the extent applicable to this Guaranty and the Obligations of each Guarantor
hereunder. To effectuate the foregoing intention, the Administrative Agent, the
other Secured Parties and the Guarantors hereby irrevocably agree that the
Obligations of each Guarantor under this Guaranty at any time shall be limited
to the maximum amount as will result in the Obligations of such Guarantor under
this Guaranty not constituting a fraudulent transfer or conveyance.
(c) Each Guarantor hereby unconditionally and irrevocably
agrees that in the event any payment shall be required to be made to any Secured
Party under this Guaranty or any other guaranty, such Guarantor will contribute,
to the maximum extent permitted by law, such amounts to each other Guarantor and
each other guarantor so as to maximize the aggregate amount paid to the Secured
Parties under or in respect of the Loan Documents.
SECTION 7.02. Guaranty Absolute. Each Guarantor guarantees
that the Guaranteed Obligations will be paid strictly in accordance with the
terms of the Loan Documents, regardless of any law, regulation or order now or
hereafter in effect in any jurisdiction affecting any of such terms or the
rights of any Secured Party with respect thereto. The Obligations of each
Guarantor under or in respect of this Guaranty are independent of the Guaranteed
Obligations or any other Obligations of any other Loan Party under or in respect
of the Loan Documents, and a separate action or actions may be brought and
prosecuted against each Guarantor to enforce this Guaranty, irrespective of
whether any action is brought against the Borrower or any other Loan Party or
whether the Borrower or any other Loan Party is joined in any such action or
actions. The liability of each Guarantor under this Guaranty shall be
irrevocable, absolute and unconditional irrespective of, and each Guarantor
hereby irrevocably waives any defenses it may now have or hereafter acquire in
any way relating to, any or all of the following:
(a) any lack of validity or enforceability of any Loan
Document or any agreement or instrument relating thereto;
(b) any change in the time, manner or place of payment of, or
in any other term of, all or any of the Guaranteed Obligations or any
other Obligations of any other Loan Party under or in respect of the
Loan Documents, or any other amendment or waiver of or any consent to
departure from any Loan Document, including, without limitation, any
increase in the Guaranteed Obligations resulting from the extension of
additional credit to any Loan Party or any of its Subsidiaries or
otherwise;
(c) any taking, exchange, release or non-perfection of any
Collateral or any other collateral, or any taking, release or amendment
or waiver of, or consent to departure from, any other guaranty, for all
or any of the Guaranteed Obligations;
(d) any manner of application of Collateral or any other
collateral, or proceeds thereof, to all or any of the Guaranteed
Obligations, or any manner of sale or other
84
disposition of any Collateral or any other collateral for all or any of
the Guaranteed Obligations or any other Obligations of any Loan Party
under the Loan Documents or any other assets of any Loan Party or any
of its Subsidiaries;
(e) any change, restructuring or termination of the corporate
structure or existence of any Loan Party or any of its Subsidiaries;
(f) any failure of any Secured Party to disclose to any Loan
Party any information relating to the business, condition (financial or
otherwise), operations, performance, properties or prospects of any
other Loan Party now or hereafter known to such Secured Party (each
Guarantor waiving any duty on the part of the Secured Parties to
disclose such information);
(g) the failure of any other Person to execute or deliver this
Guaranty, any Guaranty Supplement or any other guaranty or agreement or
the release or reduction of liability of any Guarantor or other
guarantor or surety with respect to the Guaranteed Obligations; or
(h) any other circumstance (including, without limitation, any
statute of limitations) or any existence of or reliance on any
representation by any Secured Party that might otherwise constitute a
defense available to, or a discharge of, any Loan Party or any other
guarantor or surety.
This Guaranty shall continue to be effective or be reinstated, as the case may
be, if at any time any payment of any of the Guaranteed Obligations is rescinded
or must otherwise be returned by any Secured Party or any other Person upon the
insolvency, bankruptcy or reorganization of the Borrower or any other Loan Party
or otherwise, all as though such payment had not been made.
SECTION 7.03. Waivers and Acknowledgments. (a) Each Guarantor
hereby unconditionally and irrevocably waives promptness, diligence, notice of
acceptance, presentment, demand for performance, notice of nonperformance,
default, acceleration, protest or dishonor and any other notice with respect to
any of the Guaranteed Obligations and this Guaranty and any requirement that any
Secured Party protect, secure, perfect or insure any Lien or any property
subject thereto or exhaust any right or take any action against any Loan Party
or any other Person or any Collateral.
(b) Each Guarantor hereby unconditionally and irrevocably
waives any right to revoke this Guaranty and acknowledges that this Guaranty is
continuing in nature and applies to all Guaranteed Obligations, whether existing
now or in the future.
(c) Each Guarantor hereby unconditionally and irrevocably
waives (i) any defense arising by reason of any claim or defense based upon an
election of remedies by any Secured Party
85
that in any manner impairs, reduces, releases or otherwise adversely affects the
subrogation, reimbursement, exoneration, contribution or indemnification rights
of such Guarantor or other rights of such Guarantor to proceed against any of
the other Loan Parties, any other guarantor or any other Person or any
Collateral and (ii) any defense based on any right of set-off or counterclaim
against or in respect of the Obligations of such Guarantor hereunder.
(d) Each Guarantor acknowledges that the Collateral Agent may,
without notice to or demand upon such Guarantor and without affecting the
liability of such Guarantor under this Guaranty, foreclose under any mortgage by
nonjudicial sale, and each Guarantor hereby waives any defense to the recovery
by the Collateral Agent and the other Secured Parties against such Guarantor of
any deficiency after such nonjudicial sale and any defense or benefits that may
be afforded by applicable law.
(e) Each Guarantor hereby unconditionally and irrevocably
waives any duty on the part of any Secured Party to disclose to such Guarantor
any matter, fact or thing relating to the business, condition (financial or
otherwise), operations, performance, properties or prospects of any other Loan
Party or any of its Subsidiaries now or hereafter known by such Secured Party.
(f) Each Guarantor acknowledges that it will receive
substantial direct and indirect benefits from the financing arrangements
contemplated by the Loan Documents and that the waivers set forth in Section
7.02 and this Section 7.03 are knowingly made in contemplation of such benefits.
SECTION 7.04. Subrogation. Each Guarantor hereby
unconditionally and irrevocably agrees not to exercise any rights that it may
now have or hereafter acquire against the Borrower, any other Loan Party or any
other insider guarantor that arise from the existence, payment, performance or
enforcement of such Guarantor's Obligations under or in respect of this Guaranty
or any other Loan Document, including, without limitation, any right of
subrogation, reimbursement, exoneration, contribution or indemnification and any
right to participate in any claim or remedy of any Secured Party against the
Borrower, any other Loan Party or any other insider guarantor or any Collateral,
whether or not such claim, remedy or right arises in equity or under contract,
statute or common law, including, without limitation, the right to take or
receive from the Borrower, any other Loan Party or any other insider guarantor,
directly or indirectly, in cash or other property or by set-off or in any other
manner, payment or security on account of such claim, remedy or right, unless
and until all of the Guaranteed Obligations and all other amounts payable under
this Guaranty shall have been paid in full in cash and the Working Capital
Commitments shall have expired or been terminated. If any amount shall be paid
to any Guarantor in violation of the immediately preceding sentence at any time
prior to the latest of (a) the payment in full in cash of the Guaranteed
Obligations and all other amounts payable under this Guaranty, and (b) the
Termination Date, such amount shall be received and held in trust for the
benefit of the Secured Parties, shall be segregated from other property and
funds of such Guarantor and shall forthwith be paid or delivered to the
Administrative Agent in the same form as so received (with any necessary
endorsement or
86
assignment) to be credited and applied to the Guaranteed Obligations and all
other amounts payable under this Guaranty, whether matured or unmatured, in
accordance with the terms of the Loan Documents, or to be held as Collateral for
any Guaranteed Obligations or other amounts payable under this Guaranty
thereafter arising. If (i) any Guarantor shall make payment to any Secured Party
of all or any part of the Guaranteed Obligations, (ii) all of the Guaranteed
Obligations and all other amounts payable under this Guaranty shall have been
paid in full in cash, and (iii) the Termination Date shall have occurred, the
Secured Parties will, at such Guarantor's request and expense, execute and
deliver to such Guarantor appropriate documents, without recourse and without
representation or warranty, necessary to evidence the transfer by subrogation to
such Guarantor of an interest in the Guaranteed Obligations resulting from such
payment made by such Guarantor pursuant to this Guaranty.
SECTION 7.05. Guaranty Supplements. Upon the execution and
delivery by any Person of a guaranty supplement in substantially the form of
Exhibit E hereto (each, a "Guaranty Supplement") pursuant to Section 5.01(m),
5.02(n) or otherwise, (a) such Person shall be referred to as an "Additional
Guarantor" and shall become and be a Guarantor hereunder, and each reference in
this Guaranty to a "Guarantor" shall also mean and be a reference to such
Additional Guarantor, and each reference in any other Loan Document to a
"Guarantor" shall also mean and be a reference to such Additional Guarantor, and
(b) each reference herein to "this Guaranty", "hereunder", "hereof" or words of
like import referring to this Guaranty, and each reference in any other Loan
Document to the "Guaranty", "thereunder", "thereof" or words of like import
referring to this Guaranty, shall mean and be a reference to this Guaranty as
supplemented by such Guaranty Supplement.
SECTION 7.06. Subordination. Each Guarantor hereby
subordinates any and all debts, liabilities and other Obligations owed to such
Guarantor by each other Loan Party (the "Subordinated Obligations") to the
Guaranteed Obligations to the extent and in the manner hereinafter set forth in
this Section 7.06:
(a) Prohibited Payments, Etc. Except during the continuance of
a Default (including the commencement and continuation of any
proceeding under any Bankruptcy Law relating to any other Loan Party),
each Guarantor may receive regularly scheduled payments from any other
Loan Party on account of the Subordinated Obligations. After the
occurrence and during the continuance of any Default (including the
commencement and continuation of any proceeding under any Bankruptcy
Law relating to any other Loan Party), however, unless the Required
Lenders otherwise agree, no Guarantor shall demand, accept or take any
action to collect any payment on account of the Subordinated
Obligations.
(b) Prior Payment of Guaranteed Obligations. In any proceeding
under any Bankruptcy Law relating to any other Loan Party, each
Guarantor agrees that the Secured Parties shall be entitled to receive
payment in full in cash of all Guaranteed Obligations (including all
interest and expenses accruing after the commencement of a proceeding
under
87
any Bankruptcy Law, whether or not constituting an allowed claim in
such proceeding ("Post Petition Interest")) before such Guarantor
receives payment of any Subordinated Obligations.
(c) Turn-Over. After the occurrence and during the continuance
of any Default (including the commencement and continuation of any
proceeding under any Bankruptcy Law relating to any other Loan Party),
each Guarantor shall, if the Administrative Agent so requests, collect,
enforce and receive payments on account of the Subordinated Obligations
as trustee for the Secured Parties and deliver such payments to the
Administrative Agent on account of the Guaranteed Obligations
(including all Post Petition Interest), together with any necessary
endorsements or other instruments of transfer, but without reducing or
affecting in any manner the liability of such Guarantor under the other
provisions of this Guaranty.
(d) Administrative Agent Authorization. After the occurrence
and during the continuance of any Event of Default (including the
commencement and continuation of any proceeding under any Bankruptcy
Law relating to any other Loan Party), the Administrative Agent is
authorized and empowered (but without any obligation to so do), in its
discretion, (i) in the name of each Guarantor, to collect and enforce,
and to submit claims in respect of, Subordinated Obligations and to
apply any amounts received thereon to the Guaranteed Obligations
(including any and all Post Petition Interest), and (ii) to require
each Guarantor (A) to collect and enforce, and to submit claims in
respect of, Subordinated Obligations and (B) to pay any amounts
received on such obligations to the Administrative Agent for
application to the Guaranteed Obligations (including any and all Post
Petition Interest).
SECTION 7.07. Continuing Guaranty; Assignments. This Guaranty
is a continuing guaranty and shall (a) remain in full force and effect until the
latest of (i) the payment in full in cash of the Guaranteed Obligations and all
other amounts payable under this Guaranty, and (ii) the Termination Date, (b) be
binding upon the Guarantor, its successors and assigns and (c) inure to the
benefit of and be enforceable by the Secured Parties and their successors,
transferees and assigns. Without limiting the generality of clause (c) of the
immediately preceding sentence, any Secured Party may assign or otherwise
transfer all or any portion of its rights and obligations under this Agreement
(including, without limitation, all or any portion of its Commitments, the
Working Capital Advances owing to it and the Working Capital Note or Notes held
by it) to any other Person, and such other Person shall thereupon become vested
with all the benefits in respect thereof granted to such Secured Party herein or
otherwise, in each case as and to the extent provided in Section 9.07. No
Guarantor shall have the right to assign its rights hereunder or any interest
herein without the prior written consent of the Secured Parties.
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ARTICLE VIII
THE AGENTS
SECTION 8.01. Authorization and Action. (a) Each Lender (in
its capacity as a Lender and on behalf of itself and its Affiliates as potential
Hedge Banks) hereby appoints and authorizes the Administrative Agent to take
such action as agent on its behalf and to exercise such powers and discretion
under this Agreement and the other Loan Documents as are delegated to the
Administrative Agent by the terms hereof and thereof, together with such powers
and discretion as are reasonably incidental thereto. As to any matters not
expressly provided for by the Loan Documents (including, without limitation,
enforcement or collection of the Working Capital Notes), the Administrative
Agent shall not be required to exercise any discretion or take any action, but
shall be required to act or to refrain from acting (and shall be fully protected
in so acting or refraining from acting) upon the instructions of the Required
Lenders, and such instructions shall be binding upon all Lenders and all holders
of Working Capital Notes; provided, however, that the Administrative Agent shall
not be required to take any action (i) that exposes the Administrative Agent to
personal liability or that is contrary to this Agreement or applicable
Requirements of Law or (ii) as to which the Administrative Agent has not
received adequate security or indemnity (whether pursuant to Section 8.05 or
otherwise). If the security or indemnity furnished to the Administrative Agent
for any purpose under or in respect of the Loan Documents shall, in the good
faith opinion of the Administrative Agent, be insufficient or become impaired,
then the Administrative Agent may require additional security or indemnity and
cease, or not commence, to follow the directions or take the actions indemnified
against until such additional security or indemnity is furnished. The
Administrative Agent hereby agrees to give to each Lender prompt notice of each
notice given to it by the Borrower pursuant to the terms of this Agreement.
(b) The Administrative Agent shall also act as the "collateral
agent" under the Loan Documents, and each of the Lenders (in its capacity as a
Lender and on behalf of itself and its affiliates as potential Hedge Banks)
hereby appoints and authorizes the Administrative Agent to act as the agent of
such Lender for purposes of acquiring, holding and enforcing any and all Liens
on Collateral granted by any of the Loan Parties to secure any of the Secured
Obligations, together with such powers and discretion as are reasonably
incidental thereto. The Administrative Agent may from time to time in its
discretion appoint any of the other Lenders or any of the Affiliates of a Lender
to act as its co-agent or sub-agent for purposes of holding or enforcing any
Lien on the Collateral (or any portion thereof) granted under the Collateral
Documents or of exercising any rights and remedies thereunder at the direction
of the Administrative Agent. In this connection, the Administrative Agent, as
"collateral agent", and such co-agents and sub-agents shall be entitled to the
benefits of all provisions of this Article VIII (including, without limitation,
Section 8.05, as though such co-agents or sub-agents were the "collateral agent"
under the Loan Documents) as if set forth in full herein with respect thereto.
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(c) The Syndication Agent shall not have any powers or
discretion under this Agreement or any of the other Loan Documents other than
those bestowed upon it as a co-agent or sub-agent from time to time by the
Administrative Agent pursuant to subsection (b) of this Section 8.01, and each
of the Lenders hereby acknowledges that the Syndication Agent shall not have any
liability under this Agreement or any of the other Loan Documents.
SECTION 8.02. Administrative Agent's Reliance, Etc. Neither
the Administrative Agent nor any of its directors, officers, agents or employees
shall be liable for any action taken or omitted to be taken by it or them under
or in connection with the Loan Documents, except for its or their own gross
negligence or willful misconduct as determined in a final, nonappealable
judgment by a court of competent jurisdiction. Without limitation of the
generality of the immediately preceding sentence, the Administrative Agent: (a)
may treat the payee of any Working Capital Note as the holder thereof until the
Administrative Agent receives and accepts an Assignment and Acceptance entered
into by the Lender that is the payee of such Working Capital Note, as assignor,
and an Eligible Assignee, as assignee, as provided in Section 9.07; (b) may
consult with legal counsel (including counsel for any Loan Party), independent
public accountants and other experts selected by it and shall not be liable for
any action taken or omitted to be taken in good faith by it in accordance with
the advice of such counsel, accountants or experts; (c) makes no warranty or
representation to any Lender and shall not be responsible to any Lender for any
statements, warranties or representations (whether written or oral) made in or
in connection with the Loan Documents; (d) shall not have any duty to ascertain
or to inquire as to the performance or observance of any of the terms, covenants
or conditions of any Loan Document on the part of any Loan Party or to inspect
the property or assets (including the books and records) of any Loan Party; (e)
shall not be responsible to any Lender for the due execution, legality,
validity, enforceability, genuineness, sufficiency or value of, or the
perfection or priority of any lien or security interest created or purported to
be created under or in connection with, any Loan Document or any other
instrument or document furnished pursuant thereto; and (f) shall incur no
liability under or in respect of any Loan Document by acting upon any notice,
consent, certificate or other instrument or writing (which may be by telegram,
telecopy or telex) believed by it to be genuine and signed or sent by the proper
party or parties.
SECTION 8.03. NationsBank, NMS and Affiliates. With respect to
its Commitments, the Working Capital Advances made by it and the Working Capital
Note or Notes issued to it, NationsBank shall have the same rights and powers
under the Loan Documents as any other Lender and may exercise the same as though
it were not the Administrative Agent; and the term "Lender" shall, unless
otherwise expressly indicated, include NationsBank in its individual capacity.
NationsBank, NMS and their respective affiliates may accept deposits from, lend
money to, act as trustee under indentures of, accept investment banking
engagements from and generally engage in any kind of business with, any Loan
Party, any of its Subsidiaries and any Person that may do business with or own
securities of any Loan Party or any such Subsidiary, all as if NationsBank and
NMS were not the Agents and without any duty to account therefor to the Lenders.
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SECTION 8.04. Lender Credit Decision. Each Lender acknowledges
that it has, independently and without reliance upon the Administrative Agent or
any other Lender and based on the financial statements referred to in Section
4.01 and such other documents and information as it has deemed appropriate, made
its own credit analysis and decision to enter into this Agreement. Each Lender
also acknowledges that it will, independently and without reliance upon the
Administrative Agent or any other Lender and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit decisions in taking or not taking action under this Agreement.
SECTION 8.05. Indemnification. (a) Each Lender severally
agrees to indemnify the Administrative Agent (to the extent not promptly
reimbursed by the Loan Parties) from and against such Lender's ratable share
(determined as provided below) of any and all liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or disbursements
of any kind or nature whatsoever that may be imposed on, incurred by, or
asserted against the Administrative Agent in any way relating to or arising out
of the Loan Documents or any action taken or omitted by the Administrative Agent
under the Loan Documents; provided, however, that no Lender shall be liable for
any portion of such liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses or disbursements resulting from the
Administrative Agent's gross negligence or willful misconduct as determined in a
final, nonappealable judgment by a court of competent jurisdiction. In the case
of any claim, investigation, litigation or proceeding for which indemnity under
this Section 8.05(a) applies, such indemnity shall apply whether or not such
claim, investigation, litigation or proceeding is brought by the Administrative
Agent, any of the other Agents, any of the Lenders or a third party. Without
limitation of the foregoing, each Lender severally agrees to reimburse the
Administrative Agent promptly upon demand for its ratable share of any costs and
expenses (including, without limitation, fees and expenses of counsel) payable
by the Loan Parties under Section 9.04, to the extent that the Administrative
Agent is not promptly reimbursed for such costs and expenses by the Loan
Parties. For purposes of this Section 8.05(a), the Lenders' respective ratable
shares of any amount shall be determined, at any time, according to the sum of
(i) the aggregate principal amount of the Working Capital Advances outstanding
at such time and owing to the respective Lenders, (ii) the aggregate unused
portions of their respective Term Commitments at such time and (iii) their
respective Unused Working Capital Commitments at such time. The failure of any
Lender to reimburse the Administrative Agent promptly upon demand for its
ratable share of any amount required to be paid by the Lender to the
Administrative Agent as provided herein shall not relieve any other Lender of
its obligation hereunder to reimburse the Administrative Agent for its ratable
share of such amount, but no Lender shall be responsible for the failure of any
other Lender to reimburse the Administrative Agent for such other Lender's
ratable share of such amount. Without prejudice to the survival of any other
agreement of any Lender hereunder, the agreement and obligations of each Lender
contained in this Section 8.05 shall survive the payment in full of principal,
interest and all other amounts payable hereunder and under the other Loan
Documents.
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SECTION 8.06. Successor Administrative Agent. The
Administrative Agent may resign at any time by giving written notice thereof to
the Lenders and the Borrower and may be removed at any time with or without
cause by the Required Lenders. Upon any such resignation or removal, the
Required Lenders shall have the right to appoint a successor Agent. If no
successor Administrative Agent shall have been so appointed by the Required
Lenders, and shall have accepted such appointment, within 30 days after the
retiring Administrative Agent's giving of notice of resignation or the Required
Lenders' removal of the retiring Administrative Agent, then the retiring
Administrative Agent may, on behalf of the Lenders, appoint a successor
Administrative Agent, which shall be a commercial bank organized under the laws
of the United States or of any state thereof and having a combined capital and
surplus of at least $100,000,000. If within 45 days after written notice is
given of the retiring Administrative Agent's resignation or removal under this
Section 8.06 no successor Administrative Agent shall have been appointed and
shall have accepted such appointment, then on such 45th day (a) the retiring
Administrative Agent's resignation or removal shall become effective, (b) the
retiring Administrative Agent shall thereupon be discharged from its duties and
obligations under the Loan Documents and (c) the Required Lenders shall
thereafter perform all duties and obligations of the retiring Administrative
Agent under the Loan Documents until such time, if any, as the Required Lenders
appoint a successor Administrative Agent as provided above in this Section 8.06.
Upon the acceptance of any appointment as Administrative Agent hereunder by a
successor Administrative Agent and upon the execution and filing or recording of
such financing statements, or amendments thereto, and such amendments or
supplements to the Mortgages, and such other instruments or notices, as may be
necessary or desirable, or as the Required Lenders may request, in order to
continue the perfection of the Liens granted or purported to be granted by the
Collateral Documents, such successor Administrative Agent shall succeed to and
become vested with all the rights, powers, discretion, privileges and duties of
the retiring Administrative Agent, and the retiring Administrative Agent shall
be discharged from its duties and obligations under the Loan Documents. After
any retiring Administrative Agent's resignation or removal hereunder as
Administrative Agent shall become effective, the provisions of this Article VIII
shall inure to its benefit as to any actions taken or omitted to be taken by it
while it was Administrative Agent under this Agreement.
ARTICLE IX
MISCELLANEOUS
SECTION 9.01. Amendments, Etc. No amendment or waiver of any
provision of this Agreement or the Working Capital Notes or any other Loan
Document, nor consent to any departure by any Loan Party therefrom, shall in any
event be effective unless the same shall be in writing and signed (or, in the
case of the Collateral Documents, consented to) by the Required Lenders, and
then such waiver or consent shall be effective only in the specific instance and
for the specific purpose for which given; provided, however, that no amendment,
waiver or consent shall, unless in writing and signed by all of the Lenders
(other than any Lender that is, at such time, a
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Defaulting Lender), do any of the following at any time: (i) waive any of the
conditions specified in Section 3.01 or, in the case of the Initial Extension of
Credit, Section 3.02, (ii) change the number of Lenders or the percentage of (A)
the Working Capital Commitments or (B) the aggregate outstanding principal
amount of the Working Capital Advances that, in each case, shall be required for
the Lenders or any of them to take any action hereunder, (iii) reduce or limit
the value of any Obligations of any Guarantor under Section 7.01 of the Guaranty
set forth in Article VII hereof, (iv) release all or substantially all of the
Collateral in any transaction or series of related transactions or permit the
creation, incurrence, assumption or existence of any Lien on all or
substantially all of the Collateral in any transaction or series of related
transactions to secure any Obligations other than Obligations owing to the
Secured Parties under the Loan Documents, (v) amend this Section 9.01, (vi)
increase the Working Capital Commitments of any Lender or subject such Lender to
any additional obligations, (vii) reduce the principal of, or interest on, the
Working Capital Notes held by such Lender or any fees or other amounts payable
hereunder to such Lender, or (viii) postpone any date fixed for any payment of
principal of, or interest on, the Working Capital Notes held by such Lender or
any fees or other amounts payable hereunder to such Lender; and provided further
that no amendment, waiver or consent shall, unless in writing and signed by the
Administrative Agent in addition to the Lenders required above to take such
action, affect the rights or duties of the Administrative Agent under this
Agreement and the other Loan Documents. Notwithstanding any of the foregoing
provisions of this Section 9.01, none of the defined terms set forth in Section
1.01 shall be amended, supplemented or otherwise modified in any manner that
would change the meaning, purpose or effect of this Section 9.01 or any section
referred to herein unless such amendment, supplement or modification is agreed
to in writing by the number and percentage of Lenders (and the Administrative
Agent, if applicable) otherwise required to amend such section under the terms
of this Section 9.01.
SECTION 9.02. Notices, Etc. (a) All notices and other
communications provided for hereunder shall be in writing (including
telegraphic, telecopy or telex communication) and mailed, telegraphed,
telecopied, telexed or delivered, (i) if to any Loan Party, at MedE America
Corporation, 00 Xxxxxxx Xxxxxx, Xxxxx 000, Xxxx Xxxxxx, Xxx Xxxx 00000
(Facsimile: 000-000-0000; Telephone: 000-000-0000), Attention: Xxxxxxx X.
Xxxxxxxx; (ii) if to any Initial Lender, at its Base Rate Lending Office
specified opposite its name on Schedule I hereto; (iii) if to any other Lender,
at its Base Rate Lending Office specified in the Assignment and Acceptance
pursuant to which it became a Lender; and (iv) if to the Administrative Agent,
as follows:
(A) for notices regarding Working Capital Borrowings,
payments, Conversions, fees, interest and other administrative matters:
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NATIONSBANK N.A.
000 Xxxxx Xxxxx Xxxxxx
Xxxxxxxxx, XX 00000
Location Code: NC1-001-15-12
Attention: Xxxxx Murnpower
Facsimile: (000) 000-0000
Telephone: (000) 000-0000; and
(B) for all other notices to the Administrative Agent or the
Collateral Agent (including with respect to Defaults, amendments,
waivers and modifications of the Loan Documents, assignments and
reports and notices under Section 5.04):
NATIONSBANK N.A.
c/o Bank of America National Trust and Savings Association
Agency Management #10831
` 0000 Xxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxxxx Xxxxxx, Vice President
Facsimile: (000) 000-0000
Telephone: (000) 000-0000
or, as to any party, at such other address as shall be designated by such party
in a written notice to the other parties and, as to each other party, at such
other address as shall be designated by such party in a written notice to the
Borrower and the Administrative Agent. All such notices and communications
shall, when mailed, telegraphed, telecopied or telexed, be effective when
deposited in the mails, delivered to the telegraph company, transmitted by
telecopier or confirmed by telex answerback, respectively, except that notices
and communications to the Administrative Agent pursuant to Article II, III or
VIII shall not be effective until received by the Administrative Agent. Delivery
by telecopier of an executed counterpart of any amendment or waiver of any
provision of this Agreement or the Working Capital Notes or of any Exhibit
hereto to be executed and delivered hereunder shall be effective as delivery of
a manually executed counterpart thereof.
(b) If any notice required under this Agreement or any of the
other Loan Documents is permitted to be made, and is made, by telephone, actions
taken or omitted to be taken in reliance thereon by the Administrative Agent or
any of the Lenders shall be binding upon the Loan Parties notwithstanding any
inconsistency between the notice provided by telephone and any subsequent
writing in confirmation thereof provided to the Administrative Agent or such
Lender; provided that any such action taken or omitted to be taken by the
Administrative Agent or such Lender shall have been in good faith and in
accordance with the terms of this Agreement.
SECTION 9.03. No Waiver; Remedies. No failure on the part of
any Lender or the Administrative Agent to exercise, and no delay in exercising,
any right hereunder or under any
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Working Capital Note shall operate as a waiver thereof; nor shall any single or
partial exercise of any such right preclude any other or further exercise
thereof or the exercise of any other right. The remedies herein provided are
cumulative and not exclusive of any remedies provided by law.
SECTION 9.04. Costs and Expenses. (a) Each of the Loan Parties
hereby agrees to pay on demand (i) all reasonable costs and expenses of the
Administrative Agent in connection with the preparation, execution, delivery,
administration, modification and amendment of the Loan Documents (including,
without limitation, (A) all due diligence, collateral review, syndication,
transportation, computer, duplication, appraisal, audit, insurance, consultant,
search, filing and recording fees and expenses and (B) the reasonable fees and
expenses of counsel for the Administrative Agent with respect thereto, with
respect to advising the Administrative Agent as to its rights and
responsibilities, or the perfection, protection or preservation of rights or
interests, under the Loan Documents, with respect to negotiations with any Loan
Party or with other creditors of any Loan Party or any of its Subsidiaries
arising out of any Default or any events or circumstances that may give rise to
a Default and with respect to presenting claims in or otherwise participating in
or monitoring any bankruptcy, insolvency or other similar proceeding involving
creditors' rights generally and any proceeding ancillary thereto) and (ii) all
costs and expenses of the Administrative Agent and each Lender in connection
with the enforcement of the Loan Documents, whether in any action, suit or
litigation, any bankruptcy, insolvency or other similar proceeding affecting
creditors' rights generally (including, without limitation, the reasonable fees
and expenses of counsel for the Administrative Agent and each Lender with
respect thereto).
(b) Each of the Loan Parties hereby agrees to indemnify and
hold harmless each Agent, each Lender and each of their Affiliates and their
officers, directors, employees, agents and advisors (each, an "Indemnified
Party") from and against any and all claims, damages, losses, liabilities and
expenses (including, without limitation, reasonable fees and expenses of
counsel) that may be incurred by or asserted or awarded against any Indemnified
Party, in each case arising out of or in connection with or by reason of
(including, without limitation, in connection with any investigation, litigation
or proceeding or preparation of a defense in connection therewith) (i) the
Facilities, the actual or proposed use of the proceeds of the Working Capital
Advances, the Loan Documents or any of the transactions contemplated thereby,
including, without limitation, and registration and sale of the Borrower Common
Stock contemplated by the Registration Statement or (ii) the actual or alleged
presence of Hazardous Materials on any property of any Loan Party or any
Environmental Action relating in any way to any Loan Party, except to the extent
such claim, damage, loss, liability or expense is found in a final,
non-appealable judgment by a court of competent jurisdiction to have resulted
from such Indemnified Party's gross negligence or willful misconduct. In the
case of an investigation, litigation or other proceeding to which the indemnity
in this Section 9.04(b) applies, such indemnity shall be effective whether or
not such investigation, litigation or proceeding is brought by any Loan Party,
its directors, shareholders or creditors or an Indemnified Party or any
Indemnified Party is otherwise a party thereto and whether or not the
Transaction or any of the other transactions contemplated hereby are
consummated. Each of the Loan Parties also agrees not to assert any claim
against any Agent, any Lender or any of their
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Affiliates, or any of their respective officers, directors, employees, attorneys
and agents, on any theory of liability, for special, indirect, consequential or
punitive damages arising out of or otherwise relating to the Facilities, the
actual or proposed use of the proceeds of the Working Capital Advances, the Loan
Documents or any of the transactions contemplated thereby.
(c) If any payment of principal of, or Conversion of, any
Eurodollar Rate Advance is made by the Borrower to or for the account of a
Lender other than on the last day of the Interest Period for such Advance, as a
result of a payment or Conversion pursuant to Section 2.08(b)(i) or 2.09(d),
acceleration of the maturity of the Working Capital Notes pursuant to Section
6.01 or for any other reason, or by an Eligible Assignee to a Lender other than
on the last day of the Interest Period for such Advance upon an assignment of
rights and obligations under this Agreement pursuant to Section 9.07 as a result
of a demand by the Borrower pursuant to Section 9.07(a), or if the Borrower
fails to make any payment or prepayment of an Advance for which a notice of
prepayment has been given or that is otherwise required to be made, whether
pursuant to Section 2.04, 2.05 or 6.01, the Borrower shall, upon demand by such
Lender (with a copy of such demand to the Administrative Agent), pay to the
Administrative Agent for the account of such Lender any amounts required to
compensate such Lender for any additional losses, costs or expenses that it may
reasonably incur as a result of such payment or Conversion or such failure to
pay or to prepay, as the case may be, including, without limitation, any loss
(including loss of anticipated profits), cost or expense incurred by reason of
the liquidation or reemployment of deposits or other funds acquired by any
Lender to fund or maintain such Advance.
(d) If any Loan Party fails to pay when due any costs,
expenses or other amounts payable by it under any Loan Document, including,
without limitation, fees and expenses of counsel and indemnities, such amount
may be paid on behalf of such Loan Party by the Administrative Agent or any
Lender, in its sole discretion.
(e) Without prejudice to the survival of any other agreement
of any Loan Party hereunder or under any other Loan Document, the agreements and
obligations of the Loan Parties contained in Sections 2.09 and 2.11 and this
Section 9.04 shall survive the payment in full of principal, interest and all
other amounts payable hereunder and under any of the other Loan Documents.
SECTION 9.05. Right of Set-off. Upon (a) the occurrence and
during the continuance of any Event of Default and (b) the making of the request
or the granting of the consent specified by Section 6.01 to authorize the
Administrative Agent to declare the Working Capital Notes due and payable
pursuant to the provisions of Section 6.01, each Lender and each of its
respective Affiliates is hereby authorized at any time and from time to time, to
the fullest extent permitted by law, to set off and otherwise apply any and all
deposits (general or special, time or demand, provisional or final) at any time
held and other indebtedness at any time owing by such Lender or such Affiliate
to or for the credit or the account of the Loan Parties against any and all of
the Obligations of the Loan Parties now or hereafter existing under the Loan
Documents, held by
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such Lender, irrespective of whether such Lender shall have made any demand
under this Agreement or such Working Capital Note or Notes and although such
obligations may be unmatured. Each Lender agrees promptly to notify such Loan
Party after any such set-off and application; provided, however, that the
failure to give such notice shall not affect the validity of such set-off and
application. The rights of each Lender and its respective Affiliates under this
Section are in addition to other rights and remedies (including, without
limitation, other rights of set-off) that such Lender and its respective
Affiliates may have.
SECTION 9.06. Binding Effect. This Agreement shall become
effective when it shall have been executed by the Loan Parties and the
Administrative Agent and when the Administrative Agent shall have been notified
by each Initial Lender that such Initial Lender has executed it and thereafter
shall be binding upon and inure to the benefit of the Loan Parties, the
Administrative Agent and each Lender and their respective successors and
assigns, except that the Borrower shall not have the right to assign its rights
hereunder or any interest herein without the prior written consent of the
Lenders.
SECTION 9.07. Assignments and Participations. (a) Each Lender
may and, so long as no Default shall have occurred and be continuing, if
demanded by the Borrower (following a demand by such Lender pursuant to Section
2.09 or 2.11) upon at least five Business Days' notice to such Lender and the
Administrative Agent, will, assign to one or more Persons all or a portion of
its rights and obligations under this Agreement (including, without limitation,
all or a portion of its Working Capital Commitment or Commitments, the Working
Capital Advances owing to it and the Working Capital Note or Notes held by it);
provided, however, that (i) each such assignment shall be of a uniform, and not
a varying, percentage of all rights and obligations under and in respect of
Working Capital Facility, (ii) except in the case of an assignment to a Person
that, immediately prior to such assignment, was a Lender or an assignment of all
of a Lender's rights and obligations under this Agreement, the aggregate amount
of the Working Capital Commitments of the assigning Lender being assigned
pursuant to each such assignment (determined as of the date of the Assignment
and Acceptance with respect to such assignment) shall in no event be less than
$5,000,000 or an integral multiple of $1,000,000 in excess thereof, (iii) each
such assignment shall be to an Eligible Assignee, (iv) each such assignment made
as a result of a demand by the Borrower pursuant to this Section 9.07(a) shall
be arranged by the Borrower after consultation with the Administrative Agent and
shall be either an assignment of all of the rights and obligations of the
assigning Lender under this Agreement or an assignment of a portion of such
rights and obligations made concurrently with another such assignment or other
such assignments that together cover all of the rights and obligations of the
assigning Lender under this Agreement, (v) no Lender shall be obligated to make
any such assignment as a result of a demand by the Borrower pursuant to this
Section 9.07(a) unless and until such Lender shall have received one or more
payments from either the Borrower or one or more Eligible Assignees in an
aggregate amount at least equal to the aggregate outstanding principal amount of
the Advances owing to such Lender, together with accrued interest thereon to the
date of payment of such principal amount and all other amounts payable to such
Lender under this Agreement, (vi) no such assignments shall be permitted without
the consent of the Syndication
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Agent until the Syndication Agent shall have notified the Lenders that
syndication of the Commitments hereunder has been completed, (vii) the
Administrative Agent shall have consented to such assignment, and (viii) 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, together with any Working Capital Note or Notes subject to such
assignment and a processing and recordation fee of $3,500.
(b) Upon such execution, delivery, acceptance and recording,
from and after the effective date specified in such Assignment and Acceptance,
(i) the assignee thereunder shall be a party hereto and, to the extent that
rights and obligations hereunder have been assigned to it pursuant to such
Assignment and Acceptance, have the rights and obligations of a Lender hereunder
and (ii) the Lender assignor thereunder shall, to the extent that rights and
obligations hereunder have been assigned by it pursuant to such Assignment and
Acceptance, relinquish its rights (other than its rights under Sections 2.10,
2.12 and 9.04 (and other similar provisions of the other Loan Documents that are
specified under the terms of such other Loan Documents to survive the payment in
full of the Obligations of the Loan Parties under or in respect of the Loan
Documents) to the extent any claim thereunder relates to an event arising prior
to such assignment) and be released from its obligations under this Agreement
(and, in the case of an Assignment and Acceptance covering all or the remaining
portion of an assigning Lender's rights and obligations under this Agreement,
such Lender shall cease to be a party hereto).
(c) By executing and delivering an Assignment and Acceptance,
the Lender assignor thereunder and the assignee thereunder confirm to and agree
with each other and the other parties hereto as follows: (i) other than as
provided in such Assignment and Acceptance, such assigning Lender makes no
representation or warranty and assumes no responsibility with respect to any
statements, warranties or representations made in or in connection with this
Agreement or any other Loan Document or the execution, legality, validity,
enforceability, genuineness, sufficiency or value of, or the perfection or
priority of any lien or security interest created or purported to be created
under or in connection with, this Agreement or any other Loan Document or any
other instrument or document furnished pursuant hereto or thereto; (ii) such
assigning Lender makes no representation or warranty and assumes no
responsibility with respect to the financial condition of the Borrower or any
other Loan Party or the performance or observance by any Loan Party of any of
its obligations under any Loan Document or any other instrument or document
furnished pursuant thereto; (iii) such assignee confirms that it has received a
copy of this Agreement, together with copies of the financial statements
referred to in Section 4.01 and such other documents and information as it has
deemed appropriate to make its own credit analysis and decision to enter into
such Assignment and Acceptance; (iv) such assignee will, independently and
without reliance upon any Agent, such assigning Lender or any other Lender and
based on such documents and information as it shall deem appropriate at the
time, continue to make its own credit decisions in taking or not taking action
under this Agreement; (v) such assignee confirms that it is an Eligible
Assignee; (vi) such assignee appoints and authorizes the Administrative Agent to
take such action as agent on its behalf and to exercise such powers and
discretion under the Loan Documents as are delegated to the
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Administrative Agent by the terms hereof, together with such powers and
discretion as are reasonably incidental thereto; (vii) such assignee agrees that
it will perform in accordance with their terms all of the obligations which by
the terms of this Agreement are required to be performed by it as a Lender; and
(viii) such assignee attaches any Internal Revenue Service form (and, if
applicable, the certificate) required to be provided by it under Section 2.12
and agrees to provide from time to time any successor or other form prescribed
by the Internal Revenue Service as required to be provided by it under Section
2.12.
(d) The Administrative Agent, acting for this purpose (but
solely for this purpose) as the agent of the Borrower, shall maintain at its
address referred to in Section 9.02 a copy of each Assignment and Acceptance
delivered to and accepted by it and a register for the recordation of the names
and addresses of the Lenders and the Working Capital Commitment of, and
principal amount of the Working Capital Advances owing under each Facility to,
each Lender from time to time (the "Register"). The entries in the Register
shall be conclusive and binding for all purposes, absent manifest error, and the
Borrower, the Administrative Agent and the Lenders [may] [shall] treat each
Person whose name is 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) Upon its receipt of an Assignment and Acceptance executed
by an assigning Lender and an assignee, together with any Working Capital Note
or Notes subject to such assignment and payment of the processing and
recordation fee, the Administrative Agent shall, if such Assignment and
Acceptance has been completed and is in substantially the form of Exhibit C
hereto, (i) accept such Assignment and Acceptance, (ii) record the information
contained therein in the Register and (iii) give prompt notice thereof to the
Borrower. In the case of any assignment by a Lender, within five Business Days
after its receipt of such notice, the Borrower, at its own expense, shall
execute and deliver to the Administrative Agent in exchange for the surrendered
Working Capital Note or Notes a new Working Capital Note to the order of such
Eligible Assignee in an amount equal to the Working Capital Commitment assumed
by it pursuant to such Assignment and Acceptance and, if the assigning Lender
has retained a Working Capital Commitment hereunder, a new Working Capital Note
to the order of the assigning Lender in an amount equal to the Working Capital
Commitment retained by it hereunder. Such new Working Capital Note or Notes
shall be in an aggregate principal amount equal to the aggregate principal
amount of such surrendered Working Capital Note or Notes, shall be dated the
effective date of such Assignment and Acceptance and shall otherwise be in
substantially the form of Exhibit A hereto.
(f) Each Lender may sell participations to one or more Persons
(other than any Loan Party or any of its Affiliates) in or to all or a portion
of its rights and obligations under this Agreement (including, without
limitation, all or a portion of its Working Capital Commitments, the Working
Capital Advances owing to it and the Working Capital Note or Notes, if any, held
by it); provided, however, that (i) such Lender's obligations under this
Agreement (including, without limitation, its Commitments) shall remain
unchanged, (ii) such Lender shall remain solely
99
responsible to the other parties hereto for the performance of such obligations,
(iii) such Lender shall remain the holder of any such Working Capital Note for
all purposes of this Agreement, (iv) the Borrower, the Administrative Agent and
the other Lenders shall continue to deal solely and directly with such Lender in
connection with such Lender's rights and obligations under this Agreement and
(v) no participant under any such participation shall have any right to approve
any amendment or waiver of any provision of any Loan Document, or any consent to
any departure by any Loan Party therefrom, except to the extent that such
amendment, waiver or consent would reduce the principal of, or interest on, the
Working Capital Notes or any fees or other amounts payable hereunder, in each
case to the extent subject to such participation, postpone any date fixed for
any payment of principal of, or interest on, the Working Capital Notes or any
fees or other amounts payable hereunder, in each case to the extent subject to
such participation, or release all or substantially all of the Collateral.
(g) Any Lender may, in connection with any assignment or
participation or proposed assignment or participation pursuant to this Section
9.07, disclose to the assignee or participant or proposed assignee or
participant, any information relating to any Loan Party or any of its
Subsidiaries furnished to such Lender by or on behalf of the Borrower or any
other Loan Party.
(h) Notwithstanding any other provision set forth in this
Agreement, any Lender may at any time create a security interest in all or any
portion of its rights under this Agreement (including, without limitation, the
Working Capital Advances owing to it and the Working Capital Note or Notes held
by it) in favor of any Federal Reserve Bank in accordance with Regulation A of
the Board of Governors of the Federal Reserve System. No such creation shall
release the applicable Lender from its obligations hereunder.
SECTION 9.08. Execution in 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 all of which taken together shall constitute one and the same
agreement. Delivery of an executed counterpart of a signature page to this
Agreement by telecopier shall be effective as delivery of a manually executed
counterpart of this Agreement.
SECTION 9.09 Confidentiality. Neither the Administrative Agent
nor any Lender shall disclose any Confidential Information to any Person without
the consent of the Borrower, other than (a) to the Administrative Agent's or
such Lender's affiliates and their officers, directors, employees, agents and
advisors and to actual or prospective Eligible Assignees and participants, and
then only on a confidential basis, (b) as required by any law, rule or
regulation or judicial process, (c) as requested or required by any state,
federal or foreign authority or examiner regulating such Lender, (d) to any
rating agency when required by it, provided that, prior to any such disclosure,
such rating agency shall undertake to preserve the confidentiality of any
Confidential Information relating to the Loan Parties received by it from such
Lender, (e) to any other person if such disclosure is reasonably incidental to
the administration of the Facilities, (f) in connection with any claim,
litigation or proceeding to which the Administrative Agent or such Lender or any
of their affiliates
100
may be a party or (g) to the extent necessary in connection with the exercise of
any remedy under this Agreement or any other Loan Document.
SECTION 9.10. Jurisdiction, Etc. (a) Each of the parties
hereto hereby irrevocably and unconditionally submits, for itself and its
property, to the nonexclusive jurisdiction of any New York state court or
federal court of the United States of America sitting in New York, New York, and
any appellate court from any thereof, in any action or proceeding arising out of
or relating to this Agreement or any of the other Loan Documents to which it is
a party, or for recognition or enforcement of any judgment, and each of the
parties hereto hereby irrevocably and unconditionally agrees that all claims in
respect of any such action or proceeding may be heard and determined in any such
New York state court or, to the extent permitted by applicable law, in such
federal court. Each of the parties hereto hereby irrevocably consents to the
service of copies of any summons and complaint and any other process which may
be served in any such action or proceeding by certified mail, return receipt
requested, or by delivering a copy of such process to such party, at its address
specified in Section 9.02, or by any other method permitted by applicable law.
Each of the parties hereto agrees that a final judgment in any such action or
proceeding shall be conclusive and may be enforced in other jurisdictions by
suit on the judgment or in any other manner provided by applicable law. Nothing
in this Agreement shall affect any right that any party may otherwise have to
bring any action or proceeding relating to this Agreement or any of the other
Loan Documents in the courts of any jurisdiction.
(b) Each of the parties hereto irrevocably and unconditionally
waives, to the fullest extent it may legally and effectively do so, any
objection that it may now or hereafter have to the laying of venue of any action
or proceeding arising out of or relating to this Agreement or any of the other
Loan Documents to which it is a party in any New York state or federal court.
Each of the parties hereto hereby irrevocably waives, to the fullest extent
permitted by applicable law, the defense of an inconvenient forum to the
maintenance of such action or proceeding in any such court.
SECTION 9.11. Governing Law. This Agreement and the Working
Capital Notes shall be governed by, and construed in accordance with, the laws
of the State of New York.
SECTION 9.12. Waiver of Jury Trial. Each of the Loan Parties,
the Agents and the Lenders irrevocably waive all right to trial by jury in any
action, proceeding or counterclaim (whether based on contract, tort or
otherwise) arising out of or relating to this Agreement, any of the other Loan
Documents, any of the instruments, agreements or other documents delivered
pursuant to the terms of the Loan Documents, the Working Capital Advances, the
transactions contemplated hereby or thereby or the actions of any Agent or any
Lender in the negotiation, administration, performance or enforcement thereof.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed by their respective officers thereunto duly authorized,
as of the date first above written.
MEDE AMERICA CORPORATION
By
------------------------------
Name:
Title:
NATIONSBANK, N.A.,
as Administrative Agent
By
------------------------------
Name:
Title:
NATIONSBANC XXXXXXXXXX
SECURITIES LLC, as Syndication Agent
By
------------------------------
Name:
Title:
INITIAL LENDERS
---------------
NATIONSBANK, N.A.
By
------------------------------
Title:
GUARANTORS
----------
MEDE AMERICA CORPORATION OF OHIO
By
------------------------------
Name:
Title:
HEALTHCARE INTERCHANGE, INC.
By
------------------------------
Name:
Title:
SCHEDULE I
COMMITMENTS AND APPLICABLE LENDING OFFICES
--------------------------------------------------------------------------------------------------------
WORKING DOMESTIC EURODOLLAR
CAPITAL LENDING LENDING
NAME OF INITIAL LENDER COMMITMENT OFFICE OFFICE
---------------------- ---------- ------ ------
NATIONSBANK, N.A. $25,000,000 000 Xxxxx Xxxxx Xxxxxx 101 North Xxxxx Street
Charlotte, North Carolina Xxxxxxxxx, Xxxxx Xxxxxxxx
00000 28255
Attention: Xxxxx Xxxxxxxx Attention: Xxxxx Xxxxxxxx
--------------------------------------------------------------------------------------------------------
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SCHEDULE 4.01(A)
BORROWER EQUITY INTERESTS
See attachment "A" for a list of WCAS Funds that hold, directly or indirectly,
outstanding shares of Common Stock and Series A Preferred Stock of the Borrower
("Preferred Stock").
See attachment "B" for a list of WCAS Funds that hold, directly or indirectly,
warrants to acquire shares of Common Stock of the Borrower.
SCHEDULE 4.01(A), ATTACHMENT "A"
POST-SPLIT
NAME COMMON PREFERRED
--------------------------------------------------------------- ----------- ----------
Welsh, Carson, Xxxxxxxx & Xxxxx V, L.P. ....................... 1,790,748 82,057
Welsh, Carson, Xxxxxxxx & Xxxxx VI, L.P. ...................... 1,790,748 82,057
WCAS Information Partners, LP ................................. 43,646 2,000
Xxxxxxx X. Xxxxx .............................................. 15,990 732
Xxxxxxx X. Xxxxxx ............................................. 19,703 902
Xxxxx X. Xxxxxxxx ............................................. 25,905 1,187
Xxxxxxx X. Xxxxx .............................................. 3,967 181
Del Chtr Trust ttee fbo Xxxxxxx X. Xxxxx XXX Rollover Trust ... 3,463 158
Xxxxxx X. Xxxx ................................................ 8,146 373
Xxxxxx X. XxXxxxxxx ........................................... 20,481 938
Xxxxx X. XxxXxxxx ............................................. 412 18
Xxxxx X. Xxxxxx ............................................... 2,727 125
Xxxxxx X. Xxxxxxxxx ........................................... 8,729 400
Xxxxxxx X. xx Xxxxxx .......................................... 3,750 171
Xxxxxxx X. Xxxxxxxx Trust, X. Xxxxx/X. Xxxxxxxx ttees ......... 479 21
Xxxx X. Xxxxxxxx Trust, X. Xxxxx/X. Xxxxxxxx ttees ............ 479 21
Xxxxxx X. Xxxxxxxx Trust, X. Xxxxx/X. Xxxxxxxx ttees .......... 479 21
WCAS Capital Partners II, L.P. ................................ 370,993
Xxxxx X. Xxxxxxxx, Xx. ........................................ 2,208 101
Xxxxxxx Xxxxx Capital Partners V. L.P. ........................ 414,639 19,000
Xxxxxxx Xxxxx Leveraged Capital Fund Limited Partnership ...... 217,939 9,986
--------- ------
TOTAL ......................................................... 5,684,848 239,956
========= =======
SCHEDULE 4.01(A), ATTACHMENT "B"
Warrant, dated December 18, 1995, issued by the Borrower to Welsh, Carson,
Xxxxxxxx & Xxxxx V, L.P. ("WCAS V"), to purchase 20,950 shares of Common Stock
at an exercise price of $4.58 per share.
Warrant, dated December 18, 1995, issued by the Borrower to Welsh, Carson,
Xxxxxxxx & Xxxxx VI, L.P. ("WCAS VI"), to purchase 20,950 shares of Common Stock
at an exercise price of $4.58 per share.
Warrant, dated December 18, 1995, issued by the Borrower to Xxxxxxx Xxxxx
Capital Partners V, L.P. ("Xxxxx V"), to purchase 7,123 shares of Common Stock
at an exercise price of $4.58 per share.
Warrant, dated December 18, 1995, issued by the Borrower to Xxxxxxx Xxxxx
Leveraged Capital Fund, Limited Partnership ("Xxxxx LCF"), to purchase 3,509
shares of Common Stock at an exercise price of $4.58 per share.
Warrant, dated January 10, 1997, issued by the Borrower to WCAS V to purchase
7,332 shares of Common Stock at an exercise price of $5.73 per share.
Warrant, dated January 10, 1997, issued by the Borrower to WCAS VI to purchase
7,332 shares of Common Stock at an exercise price of $5.73 per share.
Warrant, dated January 10, 1997, issued by the Borrower to Xxxxx V to purchase
2,438 shares of Common Stock at an exercise price of $5.73 per share.
Warrant, dated January 10, 1997, issued by the Borrower to Xxxxx LCF to purchase
1,228 shares of Common Stock at an exercise price of $5.73 per share.
Warrant, dated October 31, 1997, issued by the Borrower to WCAS VI to purchase
27,360 shares of Common Stock at an exercise price of $5.73 per share.
Warrant, dated October 31, 1997, issued by the Borrower to Xxxxx V to purchase
6,840 shares of Common Stock at an exercise price of $5.73 per share.
SCHEDULE 4.01(A), ATTACHMENT "B" (CONTINUED)
Warrant, dated October 7, 1998, issued by the Borrower to WCAS V to purchase
67,240 shares of Common Stock at an exercise price equal to the offering price
to the public in the Borrower's contemplated initial public offering (if such
offering is completed before March 31, 1999).
Warrant, dated October 7, 1998, issued by the Borrower to Xxxxx V to purchase
16,810 shares of Common Stock at an exercise price equal to the offering price
to the public in the Borrower's contemplated initial public offering (if such
offering is completed before March 31, 1999).
SCHEDULE 4.01(B)
SUBSIDIARIES
Legal name: Healthcare Interchange, Inc. ("HII")
Type of entity: corporation
Jurisdiction of incorporation: Missouri
Authorized Equity Interests: 66,250 shares of Class A Common Stock, $1 par
value, 66,250 shares of Class B Common Stock, $1 par value, 56,000 shares of
Class C Common Stock, $1 par value, and 62,500 shares of Preferred Stock, $1 par
value.
Outstanding Equity Interests: 35,000 shares of Class A Common Stock, 35,000
shares of Class B Common Stock, 20,001 shares of Class C Common Stock and 62,500
shares of Preferred Stock. All outstanding Equity Interests of HII are owned of
record and beneficially by the Borrower.
Legal Name: MedE America Corporation of Ohio ("MedE Ohio")
Formerly known as: General Computer Corporation
Type of entity: corporation
Jurisdiction of incorporation: Ohio
Authorized Equity Interests: 10,000,000 shares of Common Stock, $.10 par value,
and 1,000,000 shares of Preferred Stock, $.10 par value.
Outstanding Equity Interests: 100 shares of Common Stock. All outstanding Equity
Interests of MedE America Corporation of Ohio are owned of record and
beneficially by the Borrower.
SCHEDULE 4.01(D)
CONSENTS
None.
SCHEDULE 4.01(F)
LIABILITIES NOT REFLECTED IN FINANCIAL STATEMENTS
(i) Material fixed or contingent liabilities: None
(ii) Liabilities for taxes: None
(iii) Unusual forward or long-term commitments:
The Borrower is party to a Software Licensing and Partnering Agreement,
dated July 29, 1997, as amended, with Wellpoint Health Networks, Inc.
Pursuant to that agreement, the Borrower will provide certain custom
developed claims processing software to Wellpoint for installation at
hospitals and large medical facilities. The agreement provides for a
monthly per site license and maintenance fee, and further provides that
Wellpoint shall be the exclusive distributor of the custom developed
software in the State of California. The initial term of the agreement
expires June 30, 2001.
The Borrower is party to a Transaction Processing and Development
Agreement, dated as of July 21, 1998, with Medic Computer Systems, Inc.,
pursuant to which MedE will provide transaction processing services to
Medic. The agreement contemplates that certain elements of the Borrower's
computer system will need to be modified to provide such services, and
sets forth timetables and criteria for such modifications. The initial
term of the agreement expires June 30, 2003.
(iv) Anticipated losses from unfavorable commitments: None
SCHEDULE 4.01(V)
OPEN YEARS
MedE America Corporation
1998
1997
1996
1995
MedE Ohio
1998
1997
1996
1995
HII
1998
1997
1996
1995
The information requested by this Schedule 4.01(v) is not available for the
stockholders of MedE America Corporation.
SCHEDULE 4.01(Y)
DEBT
Part A: Existing Debt
(a) Indebtedness for borrowed money:
The Borrower has borrowed approximately $31.1 million (as of December 31,
1998) from Bank of America NT&SA pursuant to the Credit Agreement, dated
as of December 18, 1995, as amended (the "Old Credit Agreement"), between
the Borrower and Bank of America NT&SA. These borrowings bear interest at
a weighted average rate of 6.41% per annum (as of December 31, 1998),
payable periodically as provided in the Old Credit Agreement, and mature
on October 29, 1999.
On February 14, 1997, the Borrower issued its 10% Senior Subordinated Note
to WCAS Capital Partners II, L.P., in the principal amount of $25,000,000.
This note bears interest at the rate of 10% per annum, payable quarterly.
One-half of the principal amount is due on February 14, 2001 and the
balance is due on February 14, 2002.
(b) Deferred purchase price obligations:
Pursuant to an Asset Purchase Agreement, dated as of October 20, 1997, as
amended, among the Borrower, MedE Ohio, The Stockton Group, Inc. and Xxxxx
X. Xxxxx, the Borrower is obligated to pay up to $2,600,000 (plus interest
thereon at the rate of 7.25% per annum from the "Earn-Out Payment Date,"
as defined in such agreement). The Borrower expects that the amount so
payable under this agreement will be $2,022,000; however, the final amount
is still being determined.
The Borrower and/or its Subsidiaries may have incurred purchase money
indebtedness not in excess of $250,000 to finance purchases of equipment
in the ordinary course of business. None of such purchase money
indebtedness is in default.
In connection with the purchase of certain real property and improvements
in Summit County, Ohio, the Borrower owes an aggregate $312,613 (payable
in installments of $19,110 per month through July 2000) pursuant to a
Purchase Agreement, dated as of May 30, 0000, xxxxxxx XxxX Xxxxxxx
Corporation of Ohio and Xxxxxxx and Xxxxxx Xxxxxx d/b/a X.X.X. Properties.
A copy of the Purchase Agreement has been provided to counsel for the
Administrative Agent.
SCHEDULE 4.01(Y) (CONTINUED)
DEBT
Part A (continued)
(c) Notes, bonds, etc.:
See Schedule 5.02(a)
Pursuant to an Assets [sic] Purchase Agreement, dated as of March 1, 1996,
as amended, between the Borrower and Quadax, Inc., the Borrower is
obligated to pay to Quadax $6,333 per month through January 8, 2000.
(d) Conditional sales agreements, etc.: None
(e) Capitalized leases: See attachment "A".
(f) Outstanding letters of credit, etc.: None
(g) Obligations to purchase Equity Interests: In the event that no initial
public offering is completed by the Borrower, the Borrower will be obligated to
redeem its Preferred Stock in two equal installments on September 30, 2001 and
September 30, 2002. The total amount payable in each such redemption would be
approximately $20,109,464.
(h) Hedge Agreements, etc.: None
(i) Synthetic leases, off balance sheet leases, etc.: None
(j) Contingent Obligations: None
(k) Debt secured by Liens on Loan Party's assets: None
SCHEDULE 4.01(Y) (CONTINUED)
DEBT
Part B: Surviving Debt
(a) Indebtedness for borrowed money: None.
(b) Deferred purchase price obligations: See the first and second items listed
under item (b) of Part A above.
(c) Notes, bonds, etc.: See the items listed under item (c) of Part A above.
(d) Conditional sales agreements, etc.: None
(e) Capitalized leases: See attachment "A".
(f) Outstanding letters of credit, etc.: None
(g) Obligations to purchase Equity Interests: None, assuming that the Borrower
completes an IPO before September 30, 2001.
(h) Hedge Agreements, etc.: None
(i) Synthetic leases, off balance sheet leases, etc.: None
(j) Contingent Obligations: None
(k) Debt secured by Liens on Loan Party's assets: None
SCHEDULE 4.01(Y), PARTS A AND B, ATTACHMENT "A"
CAPITAL LEASES:
LESSOR LEASE LEASED LEASE EXPIRATION MONTLY
NUMBER EQUIPMENT TERM LEASE PMT
---------------------------------------------------------------------------------------------------------------
Alco Capital Resource 16,594 Canon Copier 60 May-99 838
CIT 65,222,005 Computer Equip 60 Feb-99 1,169
CIT 65,222,002 Computer Equip 60 Jul-98 1,056
CIT 65,222,003 Computer Equip 60 Aug-98 898
CIT 65,222,004 Computer Equip 60 Sep-98 690
Wheeling Nat'l Bank 33908-02 Computer Equip 60 Oct-98 288
Wheeling Nat'l Bank 00000-00 Xxxxxxxxx Xxxxx 00 Sep-98 618
Hewlett Packard 4126-38351 Computer Equip 60 Jun-99 6,638
Icon cash flow partner 70,239.0 Computer Equip 60 Aug-99 1,191
Stratus Capital 607-60702 Stratus Equip 18 May-99 7,414
Sanwa Leasing Corp 0002-1166898 Cust Serv 5 36 Jun-99 436
Xxxx Acceptance 626190-20916 Acctg Server/Sales 24 Nov-99 2,657
Colonial Pacific Xxxx 20977 Computer Euipment 24 Dec-99 2,016
Advanta US 001-0236308 Laser Printer Stockton 60 Jan-01 684
Colonial US 126509001 Computer Equip Stockton 36 Jun-99 1,128
Xxxx Commerical 438466 Computer Equip 48 Nov-99 874
Net Credit May-99 935
Data Gen'l MedE inc. Data Gen'l Equipmt Apr-00 4,037
Xxxxxx Fin'l MPC Data Gen'l Equipmt Aug-98 785
Mellon leasing MPC Data Gen'l Equipmt Sep-98 4,989
Moleasco (Dental) 4556 Burster 36 Aug-99 274
Moleasco (Dental) 4797 Auto Folding Machine 36 Sep-99 199
I.C. Capital (Dental) 3339252 Computer Equip 60 Aug-00 2,578
Data General 36 Jun-01 5,824
Capital Lease Payments
CAPITAL LEASES:
LESSOR JUL-98 AUG-98 SEP-98 OCT-98 NOV-98 DEC-98 JAN-99
----------------------------------------------------------------------------------------------------------------
Alco Capital Resource 838 838 838 838 838 838 838
CIT 1,169 1,169 1,169 1,169 1,169 1,169 1,169
CIT 1,056
CIT 898 898
CIT 690 690 690
Wheeling Nat'l Bank 288 288 288 288
Wheeling Nat'l Bank 618 618 618
Hewlett Packard 6,638 6,638 6,638 6,638 6,638 6,638 6,638
Icon cash flow partner 1,191 1,191 1,191 1,191 1,191 1,191 1,191
Stratus Capital 7,414 7,414 7,414 7,414 7,414 7,414 7,414
Sanwa Leasing Corp 436 436 436 436 436 436 436
Xxxx Acceptance 2,657 2,657 2,657 2,657 2,657 2,657 2,657
Colonial Pacific Xxxx 2,016 2,016 2,016 2,016 2,016 2,016 2,016
Advanta XX 000 000 000 000 000 000 000
Xxxxxxxx XX 1,128 1,128 1,128 1,128 1,128 1,128 1,128
Xxxx Commerical 874 874 874 874 874 874 874
Net Credit 935 935 935 935 935 935 935
Data Gen'l MedE inc. 4,037 4,037 4,037 4,037 4,037 4,037 4,037
Xxxxxx Fin'l MPC 785 785
Mellon leasing MPC 4,989 4,989 4,989
Moleasco (Dental) 274 274 274 274 274 274 274
Moleasco (Dental) 199 199 199 199 199 199 199
I.C. Capital (Dental) 2,578 2,578 2,578 2,578 2,578 2,578 2,578
Data General 5,824 5,824 5,824 5,824 5,824 5,824 5,824
Capital Lease Payments 488,120 47,160 45,477 39,180 38,892 38,892 38,892
------------------------------------------------------- ------------------------ ----
CAPITAL LEASES:
LESSOR FEB-99 MAR-99 APR-99 MAY-99 JUN-99
-------------------------------------------------------------------------------------------
Alco Capital Resource 838 838 838 838
CIT 1,169
CIT
CIT
CIT
Wheeling Nat'l Bank
Wheeling Nat'l Bank
Hewlett Packard 6,638 6,638 6,638 6,638 6,638
Icon cash flow partner 1,191 1,191 1,191 1,191 1,191
Stratus Capital 7,414 7,414 7,414 7,414
Sanwa Leasing Corp 436 436 436 436 436
Xxxx Acceptance 2,657 2,657 2,657 2,657 2,657
Colonial Pacific Xxxx 2,016 2,016 2,016 2,016 2,016
Advanta XX 000 000 000 000 000
Xxxxxxxx XX 1,128 1,128 1,128 1,128 1,128
Xxxx Commerical 874 874 874 874 874
Net Credit 935 935 935 935
Data Gen'l MedE inc. 4,037 4,037 4,037 4,037 4,037
Xxxxxx Fin'l MPC
Mellon leasing MPC
Moleasco (Dental) 274 274 274 274 274
Moleasco (Dental) 199 199 199 199 199
I.C. Capital (Dental) 2,578 2,578 2,578 2,578 2,578
Data General 5,824 5,824 5,824 5,824 5,824
Capital Lease Payments 38,892 37,723 37,723 37,723 28,536
--------------------------------------------------------------
SCHEDULE 4.01(Z)
REAL PROPERTY
Part A: Owned Real Property
Address County State Owner
------- ------ ----- -----
0000 Xxxx Xxxx., Xxxxxxxxx Xxxxxx XX Borrower
0000 Xxxxxx Xx., Xxxxxxxxx Xxxxxx XX XxxX Xxxx
000 X. Xxxxx Xx., Xxxxxx Xxxxxxxx XX MedE Ohio
Part B: Leased Real Property
See attachment "A".
Schedule 4.01(z), Part B, Attachment "A"
Property Address Lessor Lessee Expiration Annual Rental
---------------- ------ ------ ---------- -------------
00 Xxxxxxx Xxx., Xxxxx 000 Xxx Xxxxxxx Mutual Life Borrower 12/02 $180,000
Xxxx Xxxxxx, XX 00000
0000 Xxxxxxx Xxxx, Xxxxx 000 T&J Enterprises, LLC Borrower 2/01 $ 81,600
Xxxxxxx, XX. 00000
0000 Xxxxxxx Xxxx Xxxxxxx/Marc Equity Group Borrower 10/01 $120,000
Xxxx Xxxxxx, XX 00000
0 Xxxxxxx Xxxxx Xxxxxx and Xxxx Xxxxxx Borrower 7/99 $ 33,960
Xxxxxx, XX 00000
000 Xxxxxxxx Xxxx., Xxxxx 000 HMCC Associates Borrower 2/02 $324,000
Xxxxxxx Xxxxx, XX 00000
00000 Xxxxxxx Xxxx. Xxxxx 000 The Marks Group Borrower 12/02 $ 80.400
Xxxxxxxx Xxxxx, XX. 00000
000 Xxxxx Xxxxx Xxxxxx Xxxxxxxxx Leasing MedE Ohio 4/00 $ 66,000
Xxxxxxxxxx, XX. 00000
000 Xxxxxxx Xxxx. Xxxxx Xxxxxxxxxx XxxX Xxxx 12/02 $ 81,600
Xxxxxxxxxxx, XX 00000
000 Xxxxx Xxxxx Xxxxxx, Xxxxx Xxxxx First Xxxxxx L.L.C. HII 5/05 $245,000
Xxxxx Xxxxx, XX 00000
SCHEDULE 4.01(BB)
REGISTERED INTELLECTUAL PROPERTY
Borrower
U.S. Patent and Trademark Office service xxxx registration for "MEDE
AMERICA" name and logo, registration number 1,695,044, originally
registered 6/16/92, expires 2008.
HII
U.S. Patent and Trademark Office service xxxx registration for "I"
logo, registration number 2,130,684, registered January 20, 1998,
expires 2008.
SCHEDULE 5.01(N)
REAL PROPERTY SUBJECT TO MORTGAGE
0000 Xxxx Xxxxxxx
Xxxxxxxxx, Xxxx
0000 Xxxxxx Xxxxx
Xxxxxxxxx, Xxxx 00000
0000 Xxxxxxx Xxxx
Xxxxxxx, Xxxxxxx 00000
000 Xxxxxxxx Xxxxxxxxx, Xxxxx 000
Xxxxxxx Xxxxx, Xxx Xxxx 00000
SCHEDULE 5.02(A)
LIENS ON COLLATERAL
The Borrower owns 7 certificates of deposit issued by the Bank of Akron, having
an aggregate value at maturity of $268,430. All of the Borrower's right, title
and interest in and to such certificates of deposit have been pledged, pursuant
to an Assignment of Bank Account, dated March 7, 1995, between Latpon Health
Systems Inc. (which subsequently assigned this agreement to the Borrower) and QR
Management Services Inc. ("QR"), to secure indebtedness payable to QR (the
amount of such indebtedness is less than the value of such certificates). Such
indebtedness arose pursuant to an Asset Purchase Agreement, dated as of February
1, 1995, between Latpon and QR.
SCHEDULE 5.02(E)
INVESTMENTS
None
EXHIBIT A
FORM OF WORKING CAPITAL NOTE
$_______________ Dated: _______ __, ____
FOR VALUE RECEIVED, the undersigned, MEDE AMERICA CORPORATION, a
Delaware corporation (the "Borrower"), HEREBY PROMISES TO PAY to the order of
_________________________ (the "Lender") for the account of its Applicable
Lending Office (as defined in the Credit Agreement referred to below) the
aggregate principal amount of the Working Capital Advances (as defined below)
owing to the Lender by the Borrower pursuant to the Credit Agreement dated as of
January __, 1999 (as amended, amended and restated, supplemented or otherwise
modified from time to time, the "Credit Agreement"; terms defined therein,
unless otherwise defined herein, being used herein as therein defined) among the
Borrower, MEDE AMERICA CORPORATION OF OHIO, an Ohio corporation, and HEALTHCARE
INTERCHANGE, INC., a Missouri corporation, as Guarantors, the Lender and certain
other lender parties party thereto, and NationsBank, N.A., as Administrative
Agent for the Lender and such other lender parties on the Termination Date.
The Borrower promises to pay to the Lender interest on the unpaid
principal amount of each Working Capital Advance from the date of such Working
Capital Advance until such principal amount is paid in full, at such interest
rates, and payable at such times, as are specified in the Credit Agreement.
Both principal and interest are payable in lawful money of the United
States of America to NationsBank, N.A., as Administrative Agent, at 000 Xxxxx
Xxxxx Xxxxxx, Xxxxxxxxx, Xxxxx Xxxxxxxx (or some other location as shall be
designated by the Administrative Agent in a written notice to the Borrower) in
same day funds. Each Working Capital Advance owing to the Lender by the Borrower
and the maturity thereof, and all payments made on account of principal thereof,
shall be recorded by the Lender and, prior to any transfer hereof, endorsed on
the grid attached hereto, which is part of this Promissory Note; provided,
however, that the failure of the Lender to make any such recordation or
endorsement shall not affect the Obligations of the Borrower under this
Promissory Note.
This Promissory Note is one of the Notes referred to in, and is
entitled to the benefits of, the Credit Agreement. The Credit Agreement, among
other things, (i) provides for the making of advances (the "Working Capital
Advances") by the Lender to the Borrower from time to time in an aggregate
amount not to exceed at any time outstanding the U.S. dollar amount first above
mentioned, the indebtedness of the Borrower resulting from each such Working
Capital Advance being evidenced by this Promissory Note, and (ii) contains
provisions for acceleration of the maturity hereof upon the happening of certain
stated events and also for prepayments on account of principal hereof prior to
the maturity hereof upon the terms and conditions therein specified.
The obligations of the Borrower under this Promissory Note and the
other Loan Documents, and the obligations of the other Loan Parties under the
Loan Documents, are secured by the Collateral as provided in the Loan Documents.
MEDE AMERICA CORPORATION
By
-----------------------------
Title:
ADVANCES AND PAYMENTS OF PRINCIPAL
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AMOUNT OF UNPAID
AMOUNT OF PRINCIPAL PAID PRINCIPAL NOTATION
DATE ADVANCE OR PREPAID BALANCE MADE BY
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EXHIBIT B-1
FORM OF NOTICE OF BORROWING
NationsBank, N.A.,
as Administrative Agent
under the Credit Agreement
referred to below
000 Xxxxx Xxxxx Xxxxxx
Location Code: NCI-001-15-12
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000 [Date]
Attention: Xxxxx Xxxxxxxx
Ladies and Gentlemen:
The undersigned, MEDE AMERICA CORPORATION, refers to the Credit
Agreement dated as of January __, 1999 (as amended, amended and restated,
supplemented or otherwise modified from time to time, the "Credit Agreement";
the terms defined therein being used herein as therein defined), among the
undersigned, MEDE AMERICA CORPORATION OF OHIO, an Ohio corporation, and
HEALTHCARE INTERCHANGE, INC., a Missouri corporation, as Guarantors, the Lenders
party thereto and NationsBank, N.A., as Administrative Agent for the Lenders,
and hereby gives you notice, irrevocably, pursuant to Section 2.02 of the Credit
Agreement that the undersigned hereby requests a Borrowing under the Credit
Agreement, and in that connection sets forth below the information relating to
such Borrowing (the "Proposed Borrowing") as required by Section 2.02(a) of the
Credit Agreement:
(i) The Business Day of the Proposed Borrowing is _________ __, _____.
(ii) The Type of Advances comprising the Proposed Borrowing is [Base
Rate Advances] [Eurodollar Rate Advances].
(iii) The aggregate amount of the Proposed Borrowing is $__________.
[(iv) The initial Interest Period for each Eurodollar Rate Advance made
as part of the Proposed Borrowing is __________ month[s].]
The undersigned hereby certifies that the following statements are true
on the date hereof, and will be true on the date of the Proposed Borrowing:
(A) The representations and warranties contained in each Loan Document
are correct on and as of the date of the Proposed Borrowing, before and
after giving effect to the Proposed Borrowing and to the application of the
proceeds therefrom, as though made on and as of such date, other than any
such representations or warranties that, by their terms, refer to a specific
date other than the date of the Proposed Borrowing, in which case, as of
such specific date.
(B) No Default has occurred and is continuing, or would result from
such Proposed Borrowing or from the application of the proceeds therefrom.
Manual delivery of an executed counterpart of this Notice of Borrowing
by telecopier shall be effective as delivery of an original executed counterpart
of this Notice of Borrowing.
Very truly yours,
MEDE AMERICA CORPORATION
By
----------------------------------
Title:
EXHIBIT B-2
FORM OF NOTICE OF CONVERSION
NationsBank, N.A.,
as Administrative Agent
under the Credit Agreement
referred to below
000 Xxxxx Xxxxx Xxxxxx
Location Code: NCI-001-15-12
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000 [Date of Notice of Conversion]
Attention: Xxxxx Xxxxxxxx
Ladies and Gentlemen:
The undersigned, MEDE AMERICA CORPORATION, a Delaware corporation,
refers to the Credit Agreement dated as of January __, 1999 (as amended,
supplemented or otherwise modified from time to time, the "Credit Agreement";
capitalized terms defined therein unless otherwise defined herein being used
herein as therein defined) among the undersigned, MEDE AMERICA CORPORATION OF
OHIO, an Ohio corporation, and HEALTHCARE INTERCHANGE, INC., a Missouri
corporation, as Guarantors, the Lenders party thereto and NationsBank, N.A., as
Administrative Agent for the Lenders, and hereby gives you notice, irrevocably,
pursuant to Section 2.08 of the Credit Agreement, that the undersigned hereby
requests a Conversion of the Advances specified in clause (b) below under the
Credit Agreement and, in that connection, sets forth below the information
relating to such Conversion (the "Proposed Conversion") as required by Section
2.08(a) of the Credit Agreement:
(a) The Business Day of the Proposed Conversion is requested to be
_________ __, ____1.
(b) The Advances requested to be Converted as part of the Proposed
Conversion are the Working Capital Advances outstanding on the date of this
Notice of Conversion as [Base Rate Advances] [Eurodollar Rate Advances] in
an aggregate principal amount of $__________.
(c) The Advances referred to in clause (b) above are requested to be
Converted as part of the Proposed Conversion into [Base Rate Advances]
--------
1 The date specified in clause (a) shall be the last day of the existing
Interest Period for the Eurodollar Rate Advances requested to be Converted
in the Proposed Conversion.
[Eurodollar Rate Advances with an initial Interest Period having a duration of
[one] [two] [three] [six] month[s]].
Very truly yours,
MEDE AMERICA CORPORATION
By _______________________________
Name:
Title:
EXHIBIT C
FORM OF
ASSIGNMENT AND ACCEPTANCE
Reference is made to the Credit Agreement dated as of January __, 1999
(as amended, amended and restated, supplemented or otherwise modified from time
to time, the "Credit Agreement"; the terms defined therein, unless otherwise
defined herein, being used herein as therein defined) among MEDE AMERICA
CORPORATION, a Delaware corporation, (the "Borrower"), MEDE AMERICA CORPORATION
OF OHIO, an Ohio corporation, and HEALTHCARE INTERCHANGE, INC., a Missouri
corporation, as Guarantors, the Lenders party thereto and NationsBank, N.A., as
Administrative Agent for the Lenders.
Each "Assignor" referred to on Schedule 1 hereto (each, an "Assignor")
and each "Assignee" referred to on Schedule 1 hereto (each, an "Assignee")
agrees severally with respect to all information relating to it and its
assignment hereunder and on Schedule 1 hereto as follows:
1. Such Assignor hereby sells and assigns, without recourse except as
to the representations and warranties made by it herein, to such Assignee, and
such Assignee hereby purchases and assumes from such Assignor, an interest in
and to such Assignor's rights and obligations under the Credit Agreement as of
the date hereof equal to the percentage interest specified on Schedule 1 hereto
of all outstanding rights and obligations under the Credit Agreement Facility
specified on Schedule 1 hereto. After giving effect to such sale and assignment,
such Assignee's Commitments and the amount of the Advances owing to such
Assignee will be as set forth on Schedule 1 hereto.
2. Such Assignor (i) represents and warrants that its name set forth on
Schedule 1 hereto is its legal name, that it is the legal and beneficial owner
of the interest or interests being assigned by it hereunder and that such
interest or interests are free and clear of any adverse claim; (ii) makes no
representation or warranty and assumes no responsibility with respect to any
statements, warranties or representations made in or in connection with any Loan
Document or the execution, legality, validity, enforceability, genuineness,
sufficiency or value of, or the perfection or priority of any lien or security
interest created or purported to be created under or in connection with, any
Loan Document or any other instrument or document furnished pursuant thereto;
(iii) makes no representation or warranty and assumes no responsibility with
respect to the financial condition of any Loan Party or the performance or
observance by any Loan Party of any of its obligations under any Loan Document
or any other instrument or document furnished pursuant thereto; and (iv)
attaches the Note held by such Assignor and requests that the Administrative
Agent exchange such Note for a new Note payable to the order of such Assignee in
an amount equal to the Commitment assumed by such Assignee pursuant hereto or
new Notes payable to the order of such Assignee in an amount equal to the
Commitment assumed by such Assignee pursuant hereto and such Assignor in an
amount equal to the Commitment retained by such Assignor under the Credit
Agreement, respectively, as specified on Schedule 1 hereto.
3. Such Assignee (i) confirms that it has received a copy of the Credit
Agreement, together with copies of the financial statements referred to in
Section 4.01 thereof and such other documents and information as it has deemed
appropriate to make its own credit analysis and decision to enter into this
Assignment and Acceptance; (ii) agrees that it will, independently and without
reliance upon any Agent, any Assignor or any other Lender and based on such
documents and information as it shall deem appropriate at the time, continue to
make its own credit decisions in taking or not taking action under the Credit
Agreement; (iii) represents and warrants that its name set forth on Schedule 1
hereto is its legal name; (iv) confirms that it is an Eligible Assignee; (v)
appoints and authorizes each Agent to take such action as agent on its behalf
and to exercise such powers and discretion under the Loan Documents as are
delegated to such Agent by the terms thereof, together with such powers and
discretion as are reasonably incidental thereto; (vi) agrees that it will
perform in accordance with their terms all of the obligations that by the terms
of the Credit Agreement are required to be performed by it as a Lender; and
(vii) attaches any U.S. Internal Revenue Service forms required under Section
2.11 of the Credit Agreement.
4. Following the execution of this Assignment and Acceptance, it will
be delivered to the Administrative Agent for acceptance and recording by the
Administrative Agent. The effective date for this Assignment and Acceptance (the
"Effective Date") shall be the date of acceptance hereof by the Administrative
Agent, unless otherwise specified on Schedule 1 hereto.
5. Upon such acceptance and recording by the Administrative Agent, as
of the Effective Date, (i) such Assignee shall be a party to the Credit
Agreement and, to the extent provided in this Assignment and Acceptance, have
the rights and obligations of a Lender thereunder and (ii) such Assignor shall,
to the extent provided in this Assignment and Acceptance, relinquish its rights
and be released from its obligations under the Credit Agreement (other than its
rights and obligations under the Loan Documents that are specified under the
terms of such Loan Documents to survive the payment in full of the Obligations
of the Loan Parties under the Loan Documents to the extent any claim thereunder
relates to an event arising prior to the Effective Date of this Assignment and
Acceptance) and, if this Assignment and Acceptance covers all of the remaining
portion of the rights and obligations of such Assignor under the Credit
Agreement, such Assignor shall cease to be a party thereto.
6. Upon such acceptance and recording by the Administrative Agent, from
and after the Effective Date, the Administrative Agent shall make all payments
under the Credit Agreement and the Notes in respect of the interest assigned
hereby (including, without limitation, all payments of principal, interest and
commitment fees with respect thereto) to such Assignee. Such Assignor and such
Assignee shall make all appropriate adjustments in payments under the Credit
Agreement and the Notes for periods prior to the Effective Date directly between
themselves.
7. This Assignment and Acceptance shall be governed by, and construed
in accordance with, the laws of the State of New York.
8. This Assignment and Acceptance 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 all of which taken
together shall constitute one and the same agreement. Manual delivery of an
executed counterpart of Schedule 1 to this Assignment and Acceptance by
telecopier shall be effective as delivery of an original executed counterpart of
this Assignment and Acceptance.
IN WITNESS WHEREOF, each Assignor and each Assignee have caused
Schedule 1 to this Assignment and Acceptance to be executed by their officers
thereunto duly authorized as of the date specified thereon.
SCHEDULE 1
to
ASSIGNMENT AND ACCEPTANCE
ASSIGNORS:
Working Capital Facility
Percentage interest assigned % % % % %
Working Capital Commitment assigned $ $ $ $ $
Aggregate outstanding principal amount of
Working Capital Advances assigned $ $ $ $ $
Principal amount of Working Capital Note
payable to Assignor $ $ $ $ $
ASSIGNEES:
Working Capital Facility
Percentage interest assumed % % % % %
Working Capital Commitment assumed $ $ $ $ $
Aggregate outstanding principal amount of
Working Capital Advances assumed $ $ $ $ $
Principal amount of Working Capital Note
payable to Assignee $ $ $ $ $
Effective Date (if other than date of acceptance by Administrative Agent):
1_________ __, ____
ASSIGNORS
______________________________, as Assignor
[Type or print legal name of Assignor]
By _______________________________________
Title:
Dated:______________, ___
______________________________, as Assignor
[Type or print legal name of Assignor]
By _______________________________________
Title:
Dated:______________, ___
______________________________, as Assignor
[Type or print legal name of Assignor]
By _______________________________________
Title:
Dated:______________, ___
______________________________, as Assignor
[Type or print legal name of Assignor]
By _______________________________________
Title:
Dated:______________, ___
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1 This date should be no earlier than five Business Days after the delivery of
this Assignment and Acceptance to the Administrative Agent.
______________________________, as Assignor
[Type or print legal name of Assignor]
By _______________________________________
Title:
Dated:______________, ___
ASSIGNEES
______________________________, as Assignor
[Type or print legal name of Assignor]
By _______________________________________
Title:
Dated:______________, ___
Domestic Lending Office:
Eurodollar Lending Office:
______________________________, as Assignor
[Type or print legal name of Assignor]
By _______________________________________
Title:
Dated:______________, ___
Domestic Lending Office:
Eurodollar Lending Office:
______________________________, as Assignor
[Type or print legal name of Assignor]
By _______________________________________
Title:
Dated:______________, ___
Domestic Lending Office:
Eurodollar Lending Office:
______________________________, as Assignor
[Type or print legal name of Assignor]
By _______________________________________
Title:
Dated:______________, ___
Domestic Lending Office:
Eurodollar Lending Office:
______________________________, as Assignor
[Type or print legal name of Assignor]
By _______________________________________
Title:
Dated:______________, ___
Domestic Lending Office:
Eurodollar Lending Office:
Accepted 2[and Approved] this ____
day of ___________, ____
NATIONSBANK, N.A.,
as Administrative Agent
By
_______________________________
Title:
2[Approved this ____ day
of _____________, ____
MEDE AMERICA CORPORATION
By
_______________________________
Title: ]
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2 Required if the Assignee is an Eligible Assignee solely by reason of clause
(iii) of the definition of "Eligible Assignee".
EXHIBIT D
FORM OF SECURITY AGREEMENT
Dated January __, 1999
From
The Grantors referred to herein
as Grantors
to
NATIONSBANK, N.A.
as Collateral Agent
T A B L E O F C O N T E N T S
SECTION PAGE
1. Grant of Security.............................................................................2
2. Security for Obligations......................................................................5
3. Grantors Remain Liable........................................................................5
4. Delivery and Control of Security Collateral, Account Collateral or Agreement Collateral.......6
5. Maintaining the Pledged Accounts..............................................................7
6. Maintaining the Collateral Account............................................................8
7. Representations and Warranties................................................................8
8. Further Assurances...........................................................................10
9. As to Equipment and Inventory................................................................11
10. Insurance....................................................................................12
11. Place of Perfection; Records; Collection of Receivables......................................13
12. Voting Rights; Dividends; Etc................................................................14
13. As to the Assigned Agreements................................................................15
14. Payments Under the Assigned Agreements.......................................................17
15. Transfers and Other Liens; Additional Shares.................................................17
16. Collateral Agent Appointed Attorney-in-Fact..................................................17
17. Collateral Agent May Perform.................................................................18
18. The Collateral Agent's Duties................................................................18
19. Remedies.....................................................................................18
20. Indemnity and Expenses.......................................................................20
21. Amendments; Waivers; Additional Grantors; Etc................................................20
22. Notices; Etc.................................................................................21
23. Continuing Security Interest; Assignments under the Credit Agreement.........................21
24. Release; Termination.........................................................................21
25. Security Interest Absolute...................................................................22
26. Execution in Counterparts....................................................................23
27. The Mortgages................................................................................23
28. Governing Law................................................................................24
Schedules
Schedule I - Pledged Shares and Pledged Debt
Schedule II - Locations of Equipment and Inventory
Schedule III - Chief Place of Business, Chief Executive Office and Federal Tax
Identification Number
Schedule IV - Trade Names
ii
SECTION PAGE
Schedule V - Pledged Accounts
Exhibits
Exhibit A - Form of Security Agreement Supplement
Exhibit B - Form of Pledged Account Letter
Exhibit C - Form of Consent and Agreement
Exhibit D - Form of Control Agreement (Securities Account)
SECURITY AGREEMENT
SECURITY AGREEMENT dated January __, 1999 made by MEDE AMERICA CORPORATION,
a Delaware corporation (the "Borrower"), the other persons listed on the
signature pages hereof and the Additional Grantors (as defined in Section 21)
(the Borrower, the persons so listed and the Additional Grantors being,
collectively, the "Grantors"), to NationsBank, N.A., as collateral agent
(together with any successor collateral agent appointed pursuant to Article VIII
of the Credit Agreement (as hereinafter defined), the "Collateral Agent") for
the Secured Parties (as defined in the Credit Agreement).
PRELIMINARY STATEMENTS.
(1) The Borrower has entered into a Credit Agreement dated as of January
__, 1999 (said Agreement, as it may hereafter be amended, amended and restated,
supplemented or otherwise modified from time to time, being the "Credit
Agreement") with the Lenders party thereto (the "Lender Parties") and the Agents
(as defined therein).
(2) Pursuant to the Credit Agreement, the Grantors are entering into this
Agreement in order to grant to the Collateral Agent for the ratable benefit of
the Secured Parties a security interest in all of its personal property and
fixtures now owned or hereafter acquired.
(3) Each Grantor is the owner of the shares (the "Initial Pledged Shares")
of stock set forth opposite such Grantor's name on and as otherwise described in
Part I of Schedule I hereto and issued by the corporations named therein and of
the indebtedness (the "Initial Pledged Debt") set forth opposite such Grantor's
name on and as otherwise described in Part II of Schedule I hereto and issued by
the obligors named therein.
(4) The Borrower has opened a collateral securities account, (the
"Collateral Account"), with NationsBank, N.A. at its office at 000 Xxxxx Xxxxx
Xxxxxx, Xxxxxxxxx, Xxxxx Xxxxxxxx 00000 (or such other address as the Collateral
Agent may specify), in the name of the Collateral Agent and under the sole
control and dominion of the Collateral Agent and subject to the terms of this
Agreement.
(5) It is a condition precedent to the making of Working Capital Advances
by the Lender Parties under the Credit Agreement that the Grantors shall have
granted the assignment and security interest and made the pledge and assignment
contemplated by this Agreement.
(6) Each Grantor will derive substantial direct and indirect benefit from
the transactions contemplated by the Loan Documents.
2
(7) Terms defined in the Credit Agreement and not otherwise defined in this
Agreement are used in this Agreement as defined in the Credit Agreement.
Further, unless otherwise defined in this Agreement or in the Credit Agreement,
terms defined in Article 8 or 9 of the Uniform Commercial Code in effect in the
State of New York ("N.Y. Uniform Commercial Code") and/or in the Federal
Book-Entry Regulations (as defined below) are used in this Agreement as such
terms are defined in such Article 8 or 9. The term "Federal Book-Entry
Regulations" means (a) the federal regulations contained in Subpart B
("Treasury/Reserve Automated Debt Entry System (TRADES)") governing book-entry
securities consisting of U.S. Treasury bonds, notes and bills) and Subpart D
("Additional Provisions") of 31 C.F.R. Part 357, 31 C.F.R. ss. 357.2, ss. 357.10
through ss. 357.14 and ss. 357.41 through ss. 357.44 and (b) to the extent
substantially identical to the federal regulations referred to in clause (a)
above (as in effect from time to time), the federal regulations governing other
book-entry securities.
NOW, THEREFORE, in consideration of the premises and in order to induce the
Lender Parties to make Working Capital Advances under the Credit Agreement, each
Grantor hereby agrees with the Collateral Agent for the ratable benefit of the
Secured Parties as follows:
Section 1. Grant of Security. Each Grantor hereby assigns and pledges to
the Collateral Agent for the ratable benefit of the Secured Parties, and hereby
grants to the Collateral Agent for the ratable benefit of the Secured Parties a
security interest in, the following, in each case, as to each type of property
described below, whether now owned or hereafter acquired by such Grantor,
wherever located, and whether now or hereafter existing or arising
(collectively, the "Collateral"):
(a) all of such Grantor's right, title and interest in and to
all equipment in all of its forms, including, without limitation, all
computers, CPUs, monitors, printers and other payment processing
equipment, all fixtures and all parts thereof and all accessions
thereto (any and all such equipment, fixtures, parts and accessions
being the "Equipment");
(b) all of such Grantor's right, title and interest in and to
all inventory in all of its forms, (including, but not limited to, (i)
all raw materials and work in process therefor, finished goods thereof
and materials used or consumed in the manufacture, production,
preparation or shipping thereof, (ii) goods in which such Grantor has
an interest in mass or a joint or other interest or right of any kind
(including, without limitation, goods in which such Grantor has an
interest or right as consignee) and (iii) goods that are returned to or
repossessed or stopped in transit by such Grantor), and all accessions
thereto and products thereof and documents therefor (any and all such
inventory, accessions, products and documents being the "Inventory");
(c) all of such Grantor's right, title and interest in and to
all accounts, contract rights, chattel paper, instruments, deposit
accounts, general intangibles and other obligations of any kind,
whether or not arising out of or in connection with the sale or
3
lease of goods or the rendering of services and whether or not earned
by performance, and all rights now or hereafter existing in and to all
security agreements, leases and other contracts securing or otherwise
relating to any such accounts, contract rights, chattel paper,
instruments, deposit accounts, general intangibles or obligations (any
and all such accounts, contract rights, chattel paper, instruments,
deposit accounts, general intangibles and obligations, to the extent
not referred to in clause (d), (e) or (f) below, being the
"Receivables", and any and all such leases, security agreements and
other contracts being the "Related Contracts");
(d) all of such Grantor's right, title and interest in and to
the following (the "Security Collateral"):
(i) the Initial Pledged Shares and the certificates,
if any, representing the Initial Pledged Shares, and all
dividends, cash, instruments and other property from time to
time received, receivable or otherwise distributed in respect
of or in exchange for any or all of the Initial Pledged
Shares;
(ii) the Initial Pledged Debt and the instruments, if
any, evidencing the Initial Pledged Debt, and all interest,
cash, instruments and other property from time to time
received, receivable or otherwise distributed in respect of or
in exchange for any or all of the Initial Pledged Debt;
(iii) all additional shares of stock from time to
time acquired by such Grantor in any manner (such shares,
together with the Initial Pledged Shares, being the "Pledged
Shares"), and the certificates, if any, representing such
additional shares, and all dividends, cash, instruments and
other property from time to time received, receivable or
otherwise distributed in respect of or in exchange for any or
all of such shares;
(iv) all additional indebtedness from time to time
owed to such Grantor (such indebtedness, together with the
Initial Pledged Debt, being the "Pledged Debt") and the
instruments, if any, evidencing such indebtedness, and all
interest, cash, instruments and other property from time to
time received, receivable or otherwise distributed in respect
of or in exchange for any or all of such indebtedness; and
(v) all other investment property (including, without
limitation, all (A) securities, whether certificated or
uncertificated, (B) security entitlements, (C) securities
accounts, (D) commodity contracts and (E) commodity accounts)
in which such Grantor has now, or acquires from time to time
hereafter, any right, title or interest in any manner, and the
certificates or instruments, if any, representing or
evidencing such investment property, and all dividends,
interest,
4
distributions, value, cash, instruments and other property
from time to time received, receivable or otherwise
distributed in respect of or in exchange for any or all of
such investment property;
(e) all of such Grantor's right, title and interest in and to
each agreement and each Hedge Agreement to which such Grantor is now or
may hereafter become a party, in each case as such agreements may be
amended, amended and restated, supplemented or otherwise modified from
time to time (collectively, the "Assigned Agreements"), including,
without limitation, (i) all rights of such Grantor to receive moneys
due and to become due under or pursuant to the Assigned Agreements,
(ii) all rights of such Grantor to receive proceeds of any insurance,
indemnity, warranty or guaranty with respect to the Assigned
Agreements, (iii) claims of such Grantor for damages arising out of or
for breach of or default under the Assigned Agreements and (iv) the
right of such Grantor to terminate the Assigned Agreements, to perform
thereunder and to compel performance and otherwise exercise all
remedies thereunder (all such Collateral being the "Agreement
Collateral");
(f) all of such Grantor's right, title and interest in and to
the following (collectively, the "Account Collateral"):
(i) the Collateral Account, all financial assets from
time to time credited to the Collateral Account (including,
without limitation, all Cash Equivalents from time to time
credited to the Collateral Account), and all dividends,
interest, cash, instruments and other property from time to
time received, receivable or otherwise distributed in respect
of or in exchange for any or all of such financial assets;
(ii) all Pledged Accounts and Commingled Accounts
(each as hereinafter defined), all funds held therein and all
certificates and instruments, if any, from time to time
representing or evidencing the Pledged Accounts;
(iii) all other deposit accounts of such Grantor, all
funds held therein and all certificates and instruments, if
any, from time to time representing or evidencing such deposit
accounts;
(iv) all notes, certificates of deposit, deposit
accounts, checks and other instruments from time to time
delivered to or otherwise possessed by the Collateral Agent
for or on behalf of such Grantor, including, without
limitation, those delivered or possessed in substitution for
or in addition to any or all of the then existing Account
Collateral; and
5
(v) all interest, dividends, cash, instruments and
other property from time to time received, receivable or
otherwise distributed in respect of or in exchange for any or
all of the then existing Account Collateral; and
(g) all proceeds of any and all of the Collateral (including,
without limitation, proceeds that constitute property of the types
described in clauses (a) through (f) of this Section 1 and this clause
(g)) and, to the extent not otherwise included, all (i) payments under
insurance (whether or not the Collateral Agent is the loss payee
thereof), or any indemnity, warranty or guaranty, payable by reason of
loss or damage to or otherwise with respect to any of the foregoing
Collateral and (ii) cash.
Notwithstanding anything to the contrary herein, in no event shall the
Collateral include, and the Grantors shall not be deemed to have granted a
security interest in, any Excluded Assigned Agreements; provided, that
immediately upon any Assigned Agreement ceasing to be Excluded Assigned
Agreements, the Collateral shall include, and such Grantor shall be deemed to
have granted a security interest in, all of its rights, title and interests in,
to and under such Assigned Agreement.
Section 2. Security for Obligations. This Agreement secures, in the case of
each Grantor, the payment of all Obligations of such Grantor now or hereafter
existing under the Loan Documents, whether direct or indirect, absolute or
contingent, and including, without limitation, any amendments, amendment and
restatements, supplements, modifications, extensions, substitutions and renewals
thereof, and whether for principal, reimbursement obligations, interest, fees,
premiums, penalties, indemnifications, contract causes of action, costs,
expenses or otherwise (all such Obligations being the "Secured Obligations").
Without limiting the generality of the foregoing, this Agreement secures, as to
each Grantor, the payment of all amounts that constitute part of the Secured
Obligations and would be owed by such Grantor to any Secured Party under the
Loan Documents but for the fact that they are unenforceable or not allowable due
to the existence of a bankruptcy, reorganization or similar proceeding involving
a Loan Party.
Section 3. Grantors Remain Liable. Anything herein to the contrary
notwithstanding, (a) each Grantor shall remain liable under the contracts and
agreements included in such Grantor's Collateral to the extent set forth therein
to perform all of its duties and obligations thereunder to the same extent as if
this Agreement had not been executed, (b) the exercise by the Collateral Agent
of any of the rights hereunder shall not release any Grantor from any of its
duties or obligations under the contracts and agreements included in the
Collateral and (c) no Secured Party shall have any obligation or liability under
the contracts and agreements included in the Collateral by reason of this
Agreement or any other Loan Document, nor shall any Secured Party be obligated
to perform any of the obligations or duties of any Grantor thereunder or to take
any action to collect or enforce any claim for payment assigned hereunder.
6
Section 4. Delivery and Control of Security Collateral, Account Collateral
or Agreement Collateral. (a) All certificates or instruments representing or
evidencing Security Collateral, Account Collateral or Agreement Collateral (and,
to the extent requested by the Collateral Agent, any other Collateral) shall be
delivered to and held by or on behalf of the Collateral Agent pursuant hereto
and shall be in suitable form for transfer by delivery, or shall be accompanied
by duly executed instruments of transfer or assignment in blank, all in form and
substance reasonably satisfactory to the Collateral Agent. The Collateral Agent
shall have the right, upon the occurrence and during the continuance of an Event
of Default, and without notice to any Grantor, to transfer to or to register in
the name of the Collateral Agent or any of its nominees any or all of the
Security Collateral, subject only to the revocable rights specified in Section
12(a). In addition, the Collateral Agent shall have the right at any time to
exchange certificates or instruments representing or evidencing Security
Collateral for certificates or instruments of smaller or larger denominations.
Also, the Collateral Agent shall have the right at any time to convert Security
Collateral consisting of financial assets credited to the Securities Account to
Security Collateral consisting of financial assets held directly by the
Collateral Agent, and to convert Security Collateral consisting of financial
assets held directly by the Collateral Agent to Security Collateral consisting
of financial assets credited to the Securities Account.
(b) With respect to any Security Collateral in which any Grantor has any
right, title or interest and that constitutes an uncertificated security, such
Grantor will cause the issuer thereof either (i) to register the Collateral
Agent as the registered owner of such security or (ii) to agree in writing with
such Grantor and the Collateral Agent that such issuer will comply with
instructions with respect to such security originated by the Collateral Agent
without further consent of such Grantor, such agreement to be in form and
substance reasonably satisfactory to the Collateral Agent.
(c) With respect to any Security Collateral in which any Grantor has any
right, title or interest and that constitutes a security entitlement, such
Grantor will cause the securities intermediary with respect to such security
entitlement either (i) to identify in its records the Collateral Agent as the
entitlement holder of such security entitlement against such securities
intermediary or (ii) to agree in writing with such Grantor and the Collateral
Agent that such securities intermediary will comply with entitlement orders
(that is, notifications communicated to such securities intermediary directing
transfer or redemption of the financial asset to which such Grantor has a
security entitlement) originated by the Collateral Agent without further consent
of such Grantor, such agreement to be in substantially the form of Exhibit D
hereto or otherwise in form and substance reasonably satisfactory to the
Collateral Agent (such agreement being a "Securities Account Control
Agreement").
(d) With respect to any Security Collateral in which any Grantor has any
right, title or interest and that constitutes a securities account, such Grantor
will comply with subsection (c) of this Section 4 with respect to all security
entitlements credited to such securities account.
7
Section 5. Maintaining the Pledged Accounts. So long as any Working Capital
Advance or any other Obligation of any Loan Party under any Loan Document shall
remain unpaid or any Lender Party shall have any Commitment under the Credit
Agreement:
(a) Each Grantor will maintain (i) lockboxes and blocked
deposit accounts (collectively, the "Pledged Accounts") only with banks
(the "Pledged Account Banks") that have entered into letter agreements
in substantially the form of Exhibit B hereto or otherwise in form and
substance satisfactory to the Collateral Agent with such Grantor and
the Collateral Agent (the "Pledged Account Letters"), and (ii) with
respect to deposit accounts that hold funds that are payable to
providers or third parties other than the Grantors, unblocked deposit
accounts (collectively the "Commingled Accounts") only with banks (the
"Commingled Account Banks") that have entered into letter agreements in
form and substance satisfactory to the Collateral Agent whereby each
Commingled Account Bank (i) agrees to pay all funds on deposit in such
Commingled Account that are payable to such Grantor only to such
Pledged Accounts as such Grantor, or upon the occurrence and during the
continuance of an Event of Default, the Collateral Agent, shall direct
and (ii) acknowledges the Lien in favor of the Secured Parties created
hereunder on the funds of such Grantor or deposit in such Commingled
Account. Within 30 days after the Initial Extension of Credit, such
Grantor shall deliver to the Collateral Agent (i) each Pledged Account
Letter, duly executed by such Grantor, the Collateral Agent and the
Pledged Account Bank party thereto and (ii) each Commingled Account
Letter, duly executed by such Grantor, the Collateral Agent and the
Commingled Account Bank party thereto.
(b) Each Grantor will immediately instruct each Person
obligated at any time to make any payment to such Grantor for any
reason (an "Obligor") to make such payment to a Pledged Account or,
with respect to payments that are payable to a provider or other third
party other than such Grantor, to a Commingled Account of such Grantor.
So long as an Event of Default shall not have occurred and be
continuing or if the Collateral Agent shall not have given the notice
referred to in Subsection (c) below with respect to the Pledged
Accounts, such Grantor may operate the Pledged Accounts and the
Commingled Accounts in accordance with its past business practice.
(c) If an Event of Default shall have occurred and be
continuing each Grantor will, at the request of the Collateral Agent,
instruct such Pledged Account Bank to transfer to the Collateral
Account, at the end of each Business Day, in same day funds, an amount
equal to the credit balance of the Pledged Account in such Pledged
Account Bank. If any Grantor shall fail to give any such instructions
to any Pledged Account Bank, the Collateral Agent may do so without
further notice to any Grantor.
(d) Upon any termination of any Pledged Account Letter or
Commingled Account Letter or other agreement with respect to the
maintenance of a Pledged Account
8
or Commingled Account by any Grantor or any Pledged Account Bank or
Commingled Account Bank, as the case may be, such Grantor will
immediately notify all Obligors that were making payments to such
Pledged Account or Commingled Account to make all future payments to
another Pledged Account or Commingled Account, as the case may be, or
to the Collateral Account. Each Grantor agrees to terminate any or all
Pledged Accounts and Pledged Account Letters and all Commingled
Accounts and Commingled Account Letters upon request by the Collateral
Agent.
Section 6. Maintaining the Collateral Account. So long as any
Working Capital Advance or any other Obligation of any Loan Party under
any Loan Document shall remain unpaid or any Lender shall have any
Commitment under the Credit Agreement:
(a) The Borrower will maintain the Collateral Account with the
Collateral Agent or another commercial bank acceptable to the
Collateral Agent that has entered into a Pledged Account Letter (the
Collateral Agent or bank with which the Collateral Account is
maintained being the "Collateral Bank").
(b) It shall be a term and condition of the Collateral
Account, notwithstanding any term or condition to the contrary in any
other agreement relating to the Collateral Account and except as
otherwise provided by the provisions of Section 19, that no amount
(including interest on Cash Equivalents credited thereto) will be paid
or released to or for the account of, or withdrawn by or for the
account of, the Borrower or any other Person from the Collateral
Account.
Section 7. Representations and Warranties. Each Grantor represents and
warrants as follows:
(a) All of the Equipment and Inventory of such Grantor are
located at the places specified therefor in Schedule II hereto, as such
Schedule II may be amended, amended and restated, supplemented or
otherwise modified from time to time pursuant to Section 9(a) other
than incidental office equipment (such as notebook computers, portable
printers and similar portable office equipment used by employees at
offsite locations in the ordinary course of business (the "Movable
Equipment")). The chief place of business and chief executive office of
such Grantor, and the original copies of each Assigned Agreement to
which such Grantor is a party and all originals of all chattel paper
that evidence Receivables of such Grantor, are located at the address
specified therefor in Schedule III hereto, as such location may be
amended, amended and restated, supplemented or otherwise modified from
time to time pursuant to Section 11(a). Such Grantor's federal tax
identification number is set forth on Schedule III hereto. All Security
Collateral consisting of certificated securities and instruments have
been delivered to the Collateral Agent. None of the Receivables or
Agreement Collateral is
9
evidenced by a promissory note or other instrument that has not been
delivered to the Collateral Agent.
(b) Such Grantor is the legal and beneficial owner of the
Collateral of such Grantor free and clear of any Lien, claim, option or
right of others, except for the security interest created under this
Agreement or permitted under the Credit Agreement. No effective
financing statement or other instrument similar in effect covering all
or any part of such Collateral or listing such Grantor or any trade
name of such Grantor as debtor is on file in any recording office,
except such as may have been filed in favor of the Collateral Agent
relating to the Loan Documents or as otherwise permitted under the
Credit Agreement. Such Grantor has the trade names listed on Schedule
IV hereto.
(c) Such Grantor has exclusive possession and control of the
Equipment and Inventory.
(d) The Pledged Shares pledged by such Grantor hereunder have
been duly authorized and validly issued and are fully paid and
non-assessable. The Pledged Debt pledged by such Grantor hereunder (i)
to the best of our knowledge, has been duly authorized, authenticated
or issued and delivered, is the legal, valid and binding obligation of
the issuers thereof, and (ii) is evidenced by one or more promissary
notes (which notes have been delivered to the Collateral Agent) and is
not in default.
(e) The Initial Pledged Shares constitute the percentage of
the issued and outstanding shares of stock of the issuers thereof
indicated on Schedule I hereto as of the date hereof. The Initial
Pledged Debt constitutes all of the outstanding indebtedness owed to
such Grantor by the issuers thereof and is outstanding, as of the date
hereof, in the principal amount indicated on Schedule I hereto as of
the date hereof.
(f) All of the investment property owned by such Grantor as of
the date hereof is listed on Schedule I hereto.
(g) The Assigned Agreements to which such Grantor is a party,
true and complete copies of which (other than the Hedge Agreements)
have been furnished to each Secured Party, have been duly authorized,
executed and delivered by all parties thereto, have not been amended,
amended and restated, supplemented or otherwise modified, are in full
force and effect and are binding upon and enforceable against all
parties thereto in accordance with their terms. To the best of our
knowledge, there exists no default under any Assigned Agreement to
which such Grantor is a party by any party thereto. Each party to the
Assigned Agreements to which such Grantor is a party other than the
Grantors has executed and delivered to such Grantor a consent, in
substantially the form of Exhibit C hereto or otherwise in form and
substance satisfactory to the Collateral
10
Agent, to the assignment of the Agreement Collateral to the Collateral
Agent pursuant to this Agreement.
(h) Such Grantor has no Pledged Accounts or Commingled
Accounts or other deposit accounts other than the Pledged Accounts and
Commingled Accounts listed on Schedule V hereto. Such Grantor has
instructed all existing Obligors to make all payments to either a
Pledged Account or the Collateral Account, or with respect to payments
that are payable to a provider or third party other than such Grantor,
to a Commingled Account.
(i) All filings and other actions necessary or desirable to
perfect and protect the security interest in the Collateral created
under this Agreement have been duly made or taken, and this Agreement
creates in favor of the Collateral Agent for the benefit of the Secured
Parties a valid and, together with such filings and other actions,
perfected first priority (subject to Permitted Liens) security interest
in the Collateral of such Grantor, securing the payment of the Secured
Obligations.
(j) No authorization or approval or other action by, and no
notice to or filing with, any governmental authority or regulatory body
or any other third party is required for (i) the grant by such Grantor
of the assignment, pledge and security interest granted hereunder or
for the execution, delivery or performance of this Agreement by such
Grantor, (ii) the perfection or maintenance of the assignment, pledge
and security interest created hereunder (including the first priority
nature of such assignment, pledge or security interest), except for the
filing of financing and continuation statements under the Uniform
Commercial Code, which financing statements will be duly filed
immediately following the date hereof and upon filing will be in full
force and effect, and the actions described in Section 4 with respect
to Security Collateral, which actions have been taken and are in full
force and effect, or (iii) for the exercise by the Collateral Agent of
its voting or other rights provided for in this Agreement or the
remedies in respect of the Collateral pursuant to this Agreement,
except as may be required in connection with the disposition of any
portion of the Security Collateral by laws affecting the offering and
sale of securities generally.
(k) The Inventory that has been produced by such Grantor has
been produced in compliance with all requirements of applicable law,
including, without limitation, the Fair Labor Standards Act.
Section 8. Further Assurances. (a) Each Grantor agrees that
from time to time, at the expense of such Grantor, such Grantor will promptly
execute and deliver all further instruments and documents, and take all further
action, that may be necessary or desirable, or that the Collateral Agent may
reasonably request, in order to perfect and protect any pledge, assignment or
security interest granted or purported to be granted hereby or to enable the
11
Collateral Agent to exercise and enforce its rights and remedies hereunder with
respect to any Collateral. Without limiting the generality of the foregoing,
each Grantor will promptly: (i) xxxx conspicuously each document included in the
Inventory, each chattel paper included in the Receivables, each Related
Contract, each Assigned Agreement and, at the request of the Collateral Agent,
each of its records pertaining to the Collateral with a legend, in form and
substance satisfactory to the Collateral Agent, indicating that such document,
chattel paper, Related Contract, Assigned Agreement or Collateral is subject to
the security interest granted hereby; (ii) if any Collateral shall be evidenced
by a promissory note or other instrument, deliver and pledge to the Collateral
Agent hereunder such note or instrument duly indorsed and accompanied by duly
executed instruments of transfer or assignment, all in form and substance
satisfactory to the Collateral Agent; (iii) execute and file such financing or
continuation statements, or amendments thereto, and such other instruments or
notices, as may be necessary or desirable, or as the Collateral Agent may
request, in order to perfect and preserve the security interest granted or
purported to be granted hereunder; (iv) deliver and pledge to the Collateral
Agent for benefit of the Secured Parties certificates representing the Pledged
Shares accompanied by undated stock powers executed in blank; and (v) deliver to
the Collateral Agent evidence that all other action that the Collateral Agent
may deem reasonably necessary or desirable in order to perfect and protect the
security interest created under this Agreement has been taken.
(b) Each Grantor hereby authorizes the Collateral Agent to file one or more
financing or continuation statements, and amendments thereto, relating to all or
any part of the Collateral without the signature of such Grantor where permitted
by law. A photocopy or other reproduction of this Agreement or any financing
statement covering the Collateral or any part thereof shall be sufficient as a
financing statement where permitted by law.
(c) Each Grantor will furnish to the Collateral Agent from time to time
statements and schedules further identifying and describing the Collateral and
such other reports in connection with the Collateral as the Collateral Agent may
reasonably request, all in reasonable detail.
Section 9. As to Equipment and Inventory. (a) Each Grantor will keep the
Equipment and Inventory of such Grantor (other than Inventory sold in the
ordinary course of business and Movable Equipment) at the places therefor
specified in Section 7(a) or, upon 30 days' prior written notice to the
Collateral Agent, at such other places in a jurisdiction where all action
required by Section 8 shall have been taken with respect to such Equipment and
Inventory (and, upon the taking of such action in such jurisdiction, Schedule II
hereto shall be automatically amended to include such other places).
(b) Each Grantor will cause the Equipment of such Grantor to be maintained
and preserved in the same condition, repair and working order as when new,
ordinary wear and tear excepted, and in accordance with any manufacturer's
manual, and will forthwith, or in the case of any loss or damage to any of such
Equipment as soon as practicable after the occurrence
12
thereof, make or cause to be made all repairs, replacements and other
improvements in connection therewith that are necessary or desirable to such
end. Each Grantor will promptly furnish to the Collateral Agent a statement
respecting any material loss or damage to any of the Equipment or Inventory of
such Grantor.
(c) Each Grantor will pay promptly when due all property and other taxes,
assessments and governmental charges or levies imposed upon, and all claims
(including, without limitation, claims for labor, materials and supplies)
against, the Equipment and Inventory of such Grantor, except to the extent
payment thereof is not required by Section 5.01(b) of the Credit Agreement. In
producing the Inventory, each Grantor will comply with all requirements of
applicable law, including, without limitation, the Fair Labor Standards Act.
Section 10. Insurance. (a) Each Grantor will, at its own expense, maintain
insurance with respect to the Equipment and Inventory of such Grantor in such
amounts, against such risks, in such form and with such insurers, as shall be
satisfactory to the Collateral Agent from time to time. Each policy for
liability insurance shall provide for all losses to be paid on behalf of the
Collateral Agent and such Grantor as their interests may appear, and each policy
for property damage insurance shall provide for all losses (except for losses of
less than $__________ per occurrence) to be paid directly to the Collateral
Agent. Each such policy shall in addition (i) name such Grantor and the
Collateral Agent as insured parties thereunder (without any representation or
warranty by or obligation upon the Collateral Agent) as their interests may
appear, (ii) contain the agreement by the insurer that any loss thereunder shall
be payable to the Collateral Agent notwithstanding any action, inaction or
breach of representation or warranty by such Grantor, (iii) provide that there
shall be no recourse against the Collateral Agent for payment of premiums or
other amounts with respect thereto and (iv) provide that at least 10 days' prior
written notice of cancellation or of lapse shall be given to the Collateral
Agent by the insurer. Each Grantor will, if so requested by the Collateral
Agent, deliver to the Collateral Agent original or duplicate policies of such
insurance and, as often as the Collateral Agent may reasonably request, a report
of a reputable insurance broker with respect to such insurance. Further, each
Grantor will, at the request of the Collateral Agent, duly execute and deliver
instruments of assignment of such insurance policies to comply with the
requirements of Section 8 and cause the insurers to acknowledge notice of such
assignment.
(b) Reimbursement under any liability insurance maintained by any Grantor
pursuant to this Section 10 may be paid directly to the Person who shall have
incurred liability covered by such insurance. In case of any loss involving
damage to Equipment or Inventory when subsection (c) of this Section 10 is not
applicable, the applicable Grantor will make or cause to be made the necessary
repairs to or replacements of such Equipment or Inventory, and any proceeds of
insurance properly received by or released to such Grantor shall be used by such
Grantor, except as otherwise required hereunder or by the Credit Agreement, to
pay or as reimbursement for the costs of such repairs or replacements.
13
(c) So long as no Default shall have occurred and be continuing, all
insurance payments received by the Collateral Agent in connection with any loss,
damage or destruction of any Inventory or Equipment will be released by the
Collateral Agent to the applicable Grantor for the repair, replacement or
restoration thereof, subject to such terms and conditions with respect to the
release thereof as the Collateral Agent may reasonably require. To the extent
that (i) the amount of any such insurance payments exceeds the cost of any such
repair, replacement or restoration, or (ii) such insurance payments are not
otherwise required by the applicable Grantor to complete any such repair,
replacement or restoration required hereunder, the Collateral Agent will not be
required to release the amount thereof to such Grantor and may hold or continue
to hold such amount in the Collateral Account as additional security for the
Secured Obligations of such Grantor (except that any such amount will be
released by the Collateral Agent to such Grantor if, to the extent that any
prepayment of Obligations is required under the Credit Agreement in connection
with the receipt of such amount, such prepayment has been made). Upon the
occurrence and during the continuance of any Event of Default or the actual or
constructive total loss (in excess of $__________ per occurrence) of any
Equipment or Inventory, all insurance payments in respect of such Equipment or
Inventory shall be paid to the Collateral Agent and shall, in the Collateral
Agent's sole discretion, (i) be released to the applicable Grantor to be applied
as set forth in the first sentence of this subsection (c) or (ii) be held as
additional Collateral hereunder or applied as specified in Section 19(b).
Section 11. Place of Perfection; Records; Collection of Receivables. (a)
Each Grantor will keep its principal place of business and chief executive
office, and originals of the Assigned Agreements, Related Contracts and all
originals of all chattel paper that evidence or constitute Receivables, at the
location therefor specified in Section 7(a) or, upon 30 days' prior written
notice to the Collateral Agent, at such other location in a jurisdiction where
all actions required by Section 8 shall have been taken with respect to the
Collateral (and, upon the taking of such action in such jurisdiction, Schedule
III hereto shall be automatically amended to include such other location). Each
Grantor will hold and preserve its records relating to the Collateral, the
Assigned Agreements, the Related Contracts and chattel paper and, subject to
Section 5.01(f) of the Credit Agreement, will permit representatives of the
Collateral Agent at any time during normal business hours to inspect and make
abstracts from such records and other documents. No Grantor will change or add
any securities intermediary or commodity intermediary that maintains any
securities account or commodity account in which any of the Collateral is
credited or carried, or change or add any such securities account or commodity
account, in each case without first complying with the provisions of Section 4
in order to perfect the security interest granted hereunder in such Collateral.
(b) Except as otherwise provided in this subsection (b), each
Grantor will continue to collect, at its own expense, all amounts due or to
become due such Grantor under the Receivables and the Related Contracts. In
connection with such collections, such Grantor may take (and, at the Collateral
Agent's direction, will take) such action as such Grantor or the Collateral
Agent may reasonably deem necessary or advisable to enforce collection of the
14
Receivables and the Related Contracts; provided, however, that the Collateral
Agent shall have the right upon the occurrence and during the continuance of an
Event of Default, upon written notice to such Grantor of its intention to do so,
to notify the Obligors under any Receivables or Related Contracts of the
assignment of such Receivables or Related Contracts to the Collateral Agent and
to direct such Obligors to make payment of all amounts due or to become due to
such Grantor thereunder directly to the Collateral Agent and, upon such
notification and at the expense of such Grantor, to enforce collection of any
such Receivables or Related Contracts, and to adjust, settle or compromise the
amount or payment thereof, in the same manner and to the same extent as such
Grantor might have done. After receipt by any Grantor of the notice from the
Collateral Agent referred to in the proviso to the preceding sentence, (i) all
amounts and proceeds (including instruments) received by such Grantor in respect
of the Receivables and the Related Contracts shall be received in trust for the
benefit of the Collateral Agent hereunder, shall be segregated from other funds
of such Grantor and shall be forthwith paid over to the Collateral Agent in the
same form as so received (with any necessary indorsement) to be deposited in the
Collateral Account and applied as provided in Section 19(b) and (ii) such
Grantor will not adjust, settle or compromise the amount or payment of any
Receivable, release wholly or partly any Obligor thereof, or allow any credit or
discount thereon. No Grantor will permit or consent to the subordination of its
right to payment under any of the Receivables or the Related Contracts to any
other indebtedness or obligations of the Obligor thereof.
Section 12. Voting Rights; Dividends; Etc. (a) So long as no Event of
Default shall have occurred and be continuing:
(i) Each Grantor shall be entitled to exercise any and all
voting and other consensual rights pertaining to the Security
Collateral of such Grantor or any part thereof for any purpose;
provided however, that such Grantor will not exercise or refrain from
exercising any such right if such action would have a material adverse
effect on the value of the Security Collateral or any part thereof.
(ii) Each Grantor shall be entitled to receive and retain any
and all dividends, interest and other distributions paid in respect of
the Security Collateral of such Grantor if and to the extent that the
payment thereof is not otherwise prohibited by the terms of the Loan
Documents; provided, however, that any and all
(A) dividends, interest and other distributions paid
or payable other than in cash in respect of, and instruments
and other property received, receivable or otherwise
distributed in respect of, or in exchange for, any Security
Collateral,
(B) dividends and other distributions paid or payable
in cash in respect of any Security Collateral in connection
with a partial or total liquidation or dissolution or in
connection with a reduction of capital, capital surplus or
paid-in-surplus and
15
(C) cash paid, payable or otherwise distributed in
respect of principal of, or in redemption of, or in exchange
for, any Security Collateral
shall be, and shall be forthwith delivered to the Collateral Agent to
hold as, Security Collateral and shall, if received by such Grantor, be
received in trust for the benefit of the Collateral Agent, be
segregated from the other property or funds of such Grantor and be
forthwith delivered to the Collateral Agent as Security Collateral in
the same form as so received (with any necessary indorsement).
(iii) The Collateral Agent will promptly upon request therefor
execute and deliver (or cause to be executed and delivered) to each
Grantor all such proxies and other instruments as such Grantor may
reasonably request for the purpose of enabling such Grantor to exercise
the voting and other rights that it is entitled to exercise pursuant to
paragraph (i) above and to receive the dividends or interest payments
that it is authorized to receive and retain pursuant to paragraph (ii)
above.
(b) Upon the occurrence and during the continuance of an Event of Default:
(i) All rights of each Grantor (x) to exercise or refrain from
exercising the voting and other consensual rights that it would
otherwise be entitled to exercise pursuant to Section 12(a)(i) shall,
upon notice to such Grantor by the Collateral Agent, cease and (y) to
receive the dividends, interest and other distributions that it would
otherwise be authorized to receive and retain pursuant to Section
12(a)(ii) shall automatically cease, and all such rights shall
thereupon become vested in the Collateral Agent, which shall thereupon
have the sole right to exercise or refrain from exercising such voting
and other consensual rights and to receive and hold as Security
Collateral such dividends, interest and other distributions.
(ii) All dividends, interest and other distributions that are
received by any Grantor contrary to the provisions of paragraph (i) of
this Section 12(b) shall be received in trust for the benefit of the
Collateral Agent, shall be segregated from other funds of such Grantor
and shall be forthwith paid over to the Collateral Agent as Security
Collateral in the same form as so received (with any necessary
indorsement).
(iii) The Collateral Agent shall be authorized to send to each
Securities Intermediary as defined in and under any Control Agreement a
Notice of Exclusive Control as defined in and under such Control
Agreement.
16
Section 13. As to the Assigned Agreements. (a) Each Grantor will at its
expense:
17
(i) perform and observe all terms and provisions of the
Assigned Agreements to be performed or observed by it except to the
extent that the failure to perform or observe such term or provision,
either individually or in the aggregate, could not be reasonably
expected to have a Material Adverse Effect, maintain the Assigned
Agreements to which it is a party in full force and effect unless the
Board of Directors of such Grantor shall have determined that it is no
longer in the best interest of such Grantor to maintain such Assigned
Agreement, enforce the Assigned Agreements to which it is a party in
accordance with the terms thereof and take all such action to such end
as may be requested from time to time by the Collateral Agent; and
(ii) furnish to the Collateral Agent promptly upon receipt
thereof copies of all material notices, requests and other documents
received by such Grantor under or pursuant to the Assigned Agreements
to which it is a party, and from time to time (A) furnish to the
Collateral Agent such information and reports regarding the Assigned
Agreements and such other Collateral of such Grantor as the Collateral
Agent may reasonably request and (B) upon request of the Collateral
Agent make to each other party to any Assigned Agreement to which it is
a party such demands and requests for material information and reports
or for action as such Grantor is entitled to make thereunder.
(b) Each Grantor agrees that it will not, except to the extent otherwise
permitted under the Credit Agreement:
(i) cancel or terminate any Assigned Agreement to which it is
a party or consent to or accept any cancellation or termination
thereof;
(ii) amend, amended and restated, supplement or otherwise
modify any such Assigned Agreement or give any consent, waiver or
approval thereunder;
(iii) waive any default under or breach of any such Assigned
Agreement; or
(iv) take any other action in connection with any such
Assigned Agreement that would impair the value of the interests or
rights of such Grantor thereunder or that would impair the interests or
rights of any Secured Party.
(c) Each Grantor hereby consents on its behalf and on behalf of its
Subsidiaries to the assignment and pledge to the Collateral Agent for benefit of
the Secured Parties of each Assigned Agreement to which it is a party by any
other Grantor hereunder.
Section 14. Payments Under the Assigned Agreements. (a) Each Grantor
agrees, and has effectively so instructed each other party to each Assigned
Agreement to which it is a party, that all payments due or to become due under
or in connection with such Assigned Agreement will be made directly to a Pledged
Account.
18
(b) All moneys received or collected pursuant to subsection (a) above
shall be (i) available to the applicable Grantor on the terms set forth in
Section 5(b) so long as no Event of Default shall have occurred and be
continuing or (ii) if any Event of Default shall have occurred and be
continuing, applied as provided in Section 5(c) and 19(b).
Section 15. Transfers and Other Liens; Additional Shares. (a) Each
Grantor agrees that it will not (i) sell, assign or otherwise dispose of, or
grant any option with respect to, any of the Collateral, other than sales,
assignments and other dispositions of Collateral, and options relating to
Collateral, permitted under the terms of the Credit Agreement, or (ii) create or
suffer to exist any Lien upon or with respect to any of the Collateral of such
Grantor except for the pledge, assignment and security interest created under
this Agreement and Liens permitted under the Credit Agreement.
(b) Each Grantor agrees that it will (i) cause each issuer of the
Pledged Shares pledged by such Grantor not to issue any stock or other
securities in addition to or in substitution for the Pledged Shares issued by
such issuer, except to such Grantor, and (ii) pledge hereunder, immediately upon
its acquisition (directly or indirectly) thereof, any and all additional shares
of stock or other securities.
Section 16. Collateral Agent Appointed Attorney-in-Fact. Each Grantor
hereby irrevocably appoints the Collateral Agent such Grantor's
attorney-in-fact, with full authority in the place and stead of such Grantor and
in the name of such Grantor or otherwise, from time to time, in the Collateral
Agent's discretion, to take any action and to execute any instrument that the
Collateral Agent may reasonably deem necessary or advisable to accomplish the
purposes of this Agreement, including, without limitation:
(a) to, upon the occurrence and during the continuance of an
Event of Default, obtain and adjust insurance required to be paid to
the Collateral Agent pursuant to Section 10,
(b) to, upon the occurrence and during the continuance of an
Event of Default, ask for, demand, collect, xxx for, recover,
compromise, receive and give acquittance and receipts for moneys due
and to become due under or in respect of any of the Collateral,
(c) to, upon the occurrence and during the continuance of an
Event of Default, receive, indorse and collect any drafts or other
instruments, documents and chattel paper, in connection with clause (a)
or (b) above, and
(d) to, upon the occurrence and during the continuance of an
Event of Default, file any claims or take any action or institute any
proceedings that the Collateral Agent may deem necessary or desirable
for the collection of any of the Collateral or otherwise to
19
enforce compliance with the terms and conditions of any Assigned
Agreement or the rights of the Collateral Agent with respect to any of
the Collateral.
Section 17. Collateral Agent May Perform. If any Grantor fails to
perform any agreement contained herein, the Collateral Agent may as the
Collateral Agent deems necessary to protect the security interest granted
hereunder in the Collateral or to protect the value thereof, but without any
obligation to do so and without notice, itself perform, or cause performance of,
such agreement, and the expenses of the Collateral Agent incurred in connection
therewith shall be payable by such Grantor under Section 20(b).
Section 18. The Collateral Agent's Duties. The powers conferred on the
Collateral Agent hereunder are solely to protect the Secured Parties' interest
in the Collateral and shall not impose any duty upon it to exercise any such
powers. Except for the safe custody of any Collateral in its possession and the
accounting for moneys actually received by it hereunder, the Collateral Agent
shall have no duty as to any Collateral, as to ascertaining or taking action
with respect to calls, conversions, exchanges, maturities, tenders or other
matters relative to any Collateral, whether or not any Secured Party has or is
deemed to have knowledge of such matters, or as to the taking of any necessary
steps to preserve rights against any parties or any other rights pertaining to
any Collateral. The Collateral Agent shall be deemed to have exercised
reasonable care in the custody and preservation of any Collateral in its
possession if such Collateral is accorded treatment substantially equal to that
which it accords its own property. Anything contained herein to the contrary
notwithstanding, the Collateral Agent may from time to time when the Collateral
Agent deems it to be necessary appoint one or more subagents (each a "Subagent")
for the Collateral Agent hereunder with respect to all or any part of the
Collateral. In the event that the Collateral Agent so appoints any Subagent with
respect to any Collateral, (1) the assignment and pledge of such Collateral and
the security interest granted in such Collateral by each Grantor hereunder shall
be deemed for purposes of this Security Agreement to have been made to such
Subagent for the ratable benefit of the Secured Parties, as security for the
Secured Obligations of such Grantor, (2) such Subagent shall automatically be
vested with all rights, powers, privileges, interests and remedies of the
Collateral Agent hereunder with respect to such Collateral, and (3) the term
"Collateral Agent," when used herein in relation to any rights, powers,
privileges, interests and remedies of the Collateral Agent with respect to such
Collateral, shall include such Subagent; provided, however, that no such
Subagent shall be authorized to take any action with respect to any such
Collateral unless and except to the extent expressly authorized in writing by
the Collateral Agent.
Section 19. Remedies. If any Event of Default shall have occurred and
be continuing:
(a) The Collateral Agent may exercise in respect of the
Collateral, in addition to other rights and remedies provided for
herein or otherwise available to it, all the rights and remedies of a
secured party upon default under the N.Y. Uniform Commercial Code
(whether or not the N.Y. Uniform Commercial Code
20
applies to the affected Collateral) and also may: (i) require each
Grantor to, and each Grantor hereby agrees that it will at its expense
and upon request of the Collateral Agent forthwith, assemble all or
part of the Collateral as directed by the Collateral Agent and make it
available to the Collateral Agent at a place and time to be designated
by the Collateral Agent that is reasonably convenient to both parties;
(ii) without notice except as specified below, sell the Collateral or
any part thereof in one or more parcels at public or private sale, at
any of the Collateral Agent's offices or elsewhere, for cash, on credit
or for future delivery, and upon such other terms as the Collateral
Agent may deem commercially reasonable; (iii) occupy any premises owned
or leased by any of the Grantors where the Collateral or any part
thereof is assembled or located for a reasonable period in order to
effectuate its rights and remedies hereunder or under law, without
obligation to such Grantor in respect of such occupation; and (iv)
exercise any and all rights and remedies of any of the Grantors under
or in connection with the Assigned Agreements, the Receivables and the
Related Contracts or otherwise in respect of the Collateral, including,
without limitation, any and all rights of such Grantor to demand or
otherwise require payment of any amount under, or performance of any
provision of, the Assigned Agreements, the Receivables and the Related
Contracts. Each Grantor agrees that, to the extent notice of sale shall
be required by law, at least ten days' notice to such Grantor of the
time and place of any public sale or the time after which any private
sale is to be made shall constitute reasonable notification. The
Collateral Agent shall not be obligated to make any sale of Collateral
regardless of notice of sale having been given. The Collateral Agent
may adjourn any public or private sale from time to time by
announcement at the time and place fixed therefor, and such sale may,
without further notice, be made at the time and place to which it was
so adjourned.
(b) Any cash held by or on behalf of the Collateral Agent and
all cash proceeds received by or on behalf of the Collateral Agent in
respect of any sale of, collection from, or other realization upon all
or any part of the Collateral may, in the discretion of the Collateral
Agent, be held by the Collateral Agent as collateral for, and/or then
or at any time thereafter applied (after payment of any amounts payable
to the Collateral Agent pursuant to Section 20) in whole or in part by
the Collateral Agent for the ratable benefit of the Secured Parties
against, all or any part of the Secured Obligations in such order as
the Collateral Agent shall elect or as otherwise permitted or required
by the Credit Agreement. Any surplus of such cash or cash proceeds held
by or on the behalf of the Collateral Agent and remaining after payment
in full of all the Secured Obligations shall be paid over to the
applicable Grantor or to whomsoever may be lawfully entitled to receive
such surplus.
(c) All payments received by any Grantor under or in
connection with any Assigned Agreement or otherwise in respect of the
Collateral shall be received in trust for the benefit of the Collateral
Agent, shall be segregated from other funds of such Grantor
21
and shall be forthwith paid over to the Collateral Agent in the same
form as so received (with any necessary indorsement).
(d) The Collateral Agent may, without notice to any Grantor
except as required by law and at any time or from time to time, charge,
set-off and otherwise apply all or any part of the Secured Obligations
against any funds held in any deposit account that constitutes part of,
or is otherwise related to, the Collateral Account.
Section 20. Indemnity and Expenses. (a) Each Grantor agrees to indemnify
and hold harmless each Secured Party and each of their Affiliates and their
respective officers, directors, employees, agents and advisors (each, an
"Indemnified Party") from and against, and shall pay on demand, any and all
claims, damages, losses, liabilities and expenses (including, without
limitation, reasonable fees and expenses of counsel) that may be incurred by or
asserted or awarded against any Indemnified Party, in each case arising out of
or in connection with or resulting from this Agreement (including, without
limitation, enforcement of this Agreement), except to the extent such claim,
damage, loss, liability or expense is found in a final, non-appealable judgment
by a court of competent jurisdiction to have resulted from such Indemnified
Party's gross negligence or willful misconduct.
(b) Each Grantor will upon demand pay to the Collateral Agent the amount of
any and all reasonable expenses, including, without limitation, the reasonable
fees and expenses of its counsel and of any experts and agents, that the
Collateral Agent may incur in connection with (i) the administration of this
Agreement, (ii) the custody, preservation, use or operation of, or the sale of,
collection from or other realization upon, any of the Collateral of such
Grantor, (iii) the exercise or enforcement of any of the rights of the
Collateral Agent or the other Secured Parties hereunder or (iv) the failure by
such Grantor to perform or observe any of the provisions hereof.
Section 21. Amendments; Waivers; Additional Grantors; Etc. (a) No amendment
or waiver of any provision of this Agreement, and no consent to any departure by
any Grantor herefrom, shall in any event be effective unless the same shall be
in writing and signed by the Collateral Agent, and then such waiver or consent
shall be effective only in the specific instance and for the specific purpose
for which given. No failure on the part of the Collateral Agent or any other
Secured Party to exercise, and no delay in exercising any right hereunder, shall
operate as a waiver thereof; nor shall any single or partial exercise of any
such right preclude any other or further exercise thereof or the exercise of any
other right.
(b) Upon the execution and delivery by any Person of a security agreement
supplement in substantially the form of Exhibit A hereto (each a "Security
Agreement Supplement"), (i) such Person shall be referred to as an "Additional
Grantor" and shall be and become a Grantor and each reference in this Agreement
and the other Loan Documents to "Grantor" shall also mean and be a reference to
such Additional Grantor, and (ii) the annexes
22
attached to each Security Agreement Supplement shall be incorporated into and
become a part of and supplement Schedules I, II, III, IV and V hereto, and the
Collateral Agent may attach such annexes as supplements to such Schedules; and
each reference to such Schedules shall mean and be a reference to such Schedules
as supplemented pursuant hereto.
Section 22. Notices; Etc. All notices and other communications provided for
hereunder shall be in writing (including telegraphic, telecopier or telex
communication) and mailed, telegraphed, telecopied, telexed or delivered to, in
the case of the Borrower or the Collateral Agent, addressed to it at its address
specified in the Credit Agreement and, in the case of each Grantor other than
the Borrower, addressed to it at its address set forth opposite such Grantor's
name on the signature pages hereto or on the signature page to the Security
Agreement Supplement pursuant to which it became a party hereto; or, as to any
party, at such other address as shall be designated by such party in a written
notice to the other parties. All such notices and other communications shall,
when mailed, telegraphed, telecopied or telexed, be effective when deposited in
the mails, delivered to the telegraph company, telecopied or confirmed by telex
answerback, respectively, addressed as aforesaid; except that notices and other
communications to the Collateral Agent shall not be effective until received by
the Collateral Agent. Delivery by telecopier of an executed counterpart of any
amendment or waiver of any provision of this Agreement or of any Security
Agreement Supplement or Schedule hereto shall be effective as delivery of an
original executed counterpart thereof.
Section 23. Continuing Security Interest; Assignments under the Credit
Agreement. This Agreement shall create a continuing security interest in the
Collateral and shall (a) remain in full force and effect until the latest of (i)
the payment in full in cash of the Secured Obligations and (ii) the Termination
Date, (b) be binding upon each Grantor, its successors and assigns and (c)
inure, together with the rights and remedies of the Collateral Agent hereunder,
to the benefit of the Secured Parties and their respective successors,
transferees and assigns. Without limiting the generality of the foregoing clause
(c), any Lender Party may assign or otherwise transfer all or any portion of its
rights and obligations under the Credit Agreement (including, without
limitation, all or any portion of its Commitment, the Working Capital Advances
owing to it and the Note, if any, held by it) to any other Person, and such
other Person shall thereupon become vested with all the benefits in respect
thereof granted to such Lender Party herein or otherwise, in each case as
provided in Section 9.07 of the Credit Agreement.
Section 24. Release; Termination. (a) Upon any sale, lease, transfer or
other disposition of any item of Collateral of any Grantor in accordance with
the terms of the Loan Documents (other than sales of Inventory in the ordinary
course of business), the Collateral Agent will, at such Grantor's expense,
execute and deliver to such Grantor such documents as such Grantor shall
reasonably request to evidence the release of such item of Collateral from the
assignment and security interest granted hereby; provided, however, that (i) at
the time of such request and such release no Default shall have occurred and be
continuing, (ii) such Grantor shall have delivered to the Collateral Agent, at
least five Business Days prior to the date of the
23
proposed release, a written request for release describing the item of
Collateral and the terms of the sale, lease, transfer or other disposition in
reasonable detail, including, without limitation, the price thereof and any
expenses in connection therewith, together with a form of release for execution
by the Collateral Agent and a certificate of such Grantor to the effect that the
transaction is in compliance with the Loan Documents and as to such other
matters as the Collateral Agent may request and (iii) the proceeds of any such
sale, lease, transfer or other disposition required to be applied, or any
payment to be made in connection therewith, in accordance with Section 2.05 of
the Credit Agreement shall, to the extent so required, be paid or made to, or in
accordance with the instructions of, the Collateral Agent when and as required
under Section 2.05 of the Credit Agreement.
(b) Upon the latest of (i) the payment in full in cash of the Secured
Obligations and (ii) the Termination, the pledge, assignment and security
interest granted hereby shall terminate and all rights to the Collateral shall
revert to the applicable Grantor. Upon any such termination, the Collateral
Agent will, at the applicable Grantor's expense, execute and deliver to such
Grantor such documents as such Grantor shall reasonably request to evidence such
termination.
Section 25. Security Interest Absolute. The obligations of each Grantor
under this Agreement are independent of the Secured Obligations or any other
Obligations of any other Loan Party under or in respect of the Loan Documents,
and a separate action or actions may be brought and prosecuted against each
Grantor to enforce this Agreement, irrespective of whether any action is brought
against such Grantor or any other Loan Party or whether such Grantor or any
other Loan Party is joined in any such action or actions. All rights of the
Collateral Agent and the other Secured Parties and the pledge, assignment and
security interest hereunder, and all obligations of each Grantor hereunder,
shall be irrevocable, absolute and unconditional irrespective of, and each
Grantor hereby irrevocably waives (to the maximum extent permitted by applicable
law) any defenses it may now have or may hereafter acquire in any way relating
to, any or all of the following:
(a) any lack of validity or enforceability of any Loan
Document or any other agreement or instrument relating thereto;
(b) any change in the time, manner or place of payment of, or
in any other term of, all or any of the Secured Obligations or any
other Obligations of any other Loan Party under or in respect of the
Loan Documents or any other amendment or waiver of or any consent to
any departure from any Loan Document, including, without limitation,
any increase in the Secured Obligations resulting from the extension of
additional credit to any Loan Party or any of its Subsidiaries or
otherwise;
24
(c) any taking, exchange, release or non-perfection of any
Collateral or any other collateral, or any taking, release or amendment
or waiver of or consent to departure from any guaranty, for all or any
of the Secured Obligations;
(d) any manner of application of Collateral or any other
collateral, or proceeds thereof, to all or any of the Secured
Obligations, or any manner of sale or other disposition of any
Collateral or any other collateral for all or any of the Secured
Obligations or any other Obligations of any other Loan Party under or
in respect of the Loan Documents or any other assets of any Loan Party
or any of its Subsidiaries;
(e) any change, restructuring or termination of the corporate
structure or existence of any Loan Party or any of its Subsidiaries;
(f) any failure of any Secured Party to disclose to any Loan
Party any information relating to the business, condition (financial or
otherwise), operations, performance, assets, nature of assets,
liabilities or prospects of any other Loan Party now or hereafter known
to such Secured Party (each Grantor waiving any duty on the part of the
Secured Parties to disclose such information);
(g) the failure of any other Person to execute this Agreement
or any other Collateral Document, guaranty or agreement or the release
or reduction of liability of any Grantor or other grantor or surety
with respect to the Secured Obligations; or
(h) any other circumstance (including, without limitation, any
statute of limitations) or any existence of or reliance on any
representation by any Secured Party that might otherwise constitute a
defense available to, or a discharge of, such Grantor or any other
Grantor or a third party grantor of a security interest.
This Agreement shall continue to be effective or be reinstated, as the case may
be, if at any time any payment of any of the Secured Obligations is rescinded or
must otherwise be returned by any Secured Party or by any other Person upon the
insolvency, bankruptcy or reorganization of any Loan Party or otherwise, all as
though such payment had not been made.
Section 26. Execution in Counterparts. This Agreement may be executed in
any number of counterparts, each of which when so executed shall be deemed to be
an original and all of which taken together shall constitute one and the same
agreement. Delivery of an executed counterpart of a signature page to this
Agreement by telecopier shall be effective as delivery of an original executed
counterpart of this Agreement.
Section 27. The Mortgages. In the event that any of the Collateral
hereunder is also subject to a valid and enforceable Lien under the terms of any
Mortgage and the terms of such Mortgage are inconsistent with the terms of this
Agreement, then with respect to such
25
Collateral, the terms of such Mortgage shall be controlling in the case of
fixtures and real estate leases, letting and licenses of, and contracts and
agreements relating to the lease of, real property, and the terms of this
Agreement shall be controlling in the case of all other Collateral.
Section 28. Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York.
IN WITNESS WHEREOF, each Grantor has caused this Agreement to be duly
executed and delivered by its officer thereunto duly authorized as of the date
first above written.
MEDE AMERICA CORPORATION
By _________________________________
Title:
MEDE AMERICA CORPORATION OF
OHIO
Address for Notices:
--------------------
0000 Xxxxxx Xxxxx
Xxxxxxxxx, Xxxx 00000
By _________________________________
Title:
26
HEALTHCARE INTERCHANGE, INC.
Address for Notices:
--------------------
000 Xxxxx Xxxxx Xxxxxx
Xxxxx Xxxxx
Xxxxx Xxxxx, Xxxxxxxx 00000
By _________________________________
Title:
27
SCHEDULE I TO THE
SECURITY AGREEMENT
PLEDGED SHARES AND PLEDGED DEBT
PART I
-------------------------------------------------------------------------------------------------------
PERCENTAGE
STOCK OF
CERTIFICATE NUMBER OUTSTANDING
GRANTOR STOCK ISSUER CLASS OF STOCK PAR VALUE NO(S) OF SHARES SHARES
-------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------
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-------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------
PART II
-------------------------------------------------------------------------------------------------------
OUTSTANDING
FINAL PRINCIPAL
GRANTOR DEBT ISSUER DESCRIPTION OF DEBT DEBT CERTIFICATE NO(S). MATURITY AMOUNT
-------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------
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SCHEDULE II TO THE
SECURITY AGREEMENT
LOCATIONS OF EQUIPMENT AND INVENTORY
MEDE AMERICA CORPORATION
------------------------
LOCATIONS OF EQUIPMENT:
LOCATIONS OF INVENTORY:
MEDE AMERICA CORPORATION OF OHIO
--------------------------------
LOCATIONS OF EQUIPMENT:
LOCATIONS OF INVENTORY:
HEALTHCARE INTERCHANGE, INC.
----------------------------
LOCATIONS OF EQUIPMENT:
LOCATIONS OF INVENTORY:
SCHEDULE III TO THE
SECURITY AGREEMENT
CHIEF PLACE OF BUSINESS, CHIEF EXECUTIVE OFFICE
AND FEDERAL TAX IDENTIFICATION NUMBER
Chief Place of Business and Federal Tax
Grantor Chief Executive Office Identification Number
------- ---------------------- ---------------------
SCHEDULE IV TO THE
SECURITY AGREEMENT
TRADE NAMES
GRANTOR TRADE NAMES
SCHEDULE V TO THE
SECURITY AGREEMENT
PLEDGED ACCOUNTS
--------------------------------------------------------------------------------
NAME AND ADDRESS OF MAILING ADDRESS OF
GRANTOR PLEDGED ACCOUNT BANK LOCKBOX ACCOUNT NUMBER
------- -------------------- ------- --------------
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EXHIBIT A TO THE
SECURITY AGREEMENT
FORM OF SECURITY AGREEMENT SUPPLEMENT
[Date of Security Agreement Supplement]
NationsBank, N.A.,
as the Collateral Agent for the
Secured Parties referred to in the
Credit Agreement referred to below
c/o Bank of America National and Savings Association,
Agency Management #10831
0000 Xxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
MEDE AMERICA CORPORATION
Ladies and Gentlemen:
Reference is made to (i) the Credit Agreement dated as of January __, 1999
(as amended, amended and restated, supplemented or otherwise modified from time
to time, the "Credit Agreement"), among MEDE AMERICA CORPORATION, a Delaware
corporation, as the Borrower, MEDE AMERICA CORPORATION OF OHIO, an Ohio
corporation, and HEALTHCARE INTERCHANGE, INC., a Missouri corporation, as
Guarantors, the Lender Parties party thereto, NationsBank, N.A., as
administrative agent and as collateral agent (together with any successor agent
appointed pursuant to Article VIII of the Credit Agreement, the "Collateral
Agent") for the Lender Parties, and (ii) the Security Agreement dated January
__, 1999 (as amended, amended and restated, supplemented or otherwise modified
from time to time, the "Security Agreement") made by the Grantors from time to
time party thereto in favor of the Collateral Agent for the Secured Parties.
Capitalized terms not otherwise defined herein shall have the same meanings as
specified therefor in the Credit Agreement or the Security Agreement.
Section 1. Grant of Security. The undersigned hereby assigns and pledges to
the Collateral Agent for the benefit of the Secured Parties, and hereby grants
to the Collateral Agent for the benefit of the Secured Parties, a lien on, and
security interest in, all of its right, title and interest in and to all of the
Collateral of the undersigned, whether now owned or hereafter acquired by the
undersigned, wherever located and whether now or hereafter existing, including,
without limitation, the property and assets of the undersigned set forth on the
attached supplements to the Schedules to the Security Agreement.
Section 2. Security for Obligations. The pledge and assignment of, and the
grant of a lien on and security interest in, the Collateral by the undersigned
under this Security Agreement Supplement and the Security Agreement secures the
payment of all Obligations of the undersigned now or hereafter existing under or
in respect of the Loan Documents (including, without limitation, any extensions,
modifications, substitutions, amendments or renewals of any or all of the
foregoing Obligations), whether direct or indirect, absolute or contingent, and
whether for principal, reimbursement obligations, interest, premiums, penalties,
fees, indemnifications, contract causes of action, costs, expenses or otherwise.
Without limiting the generality of the foregoing, this Security Agreement
Supplement and the Security Agreement secures the payment of all amounts that
constitute part of the Secured Obligations and that would be owed by the
undersigned to any Secured Party under the Loan Documents but for the fact that
such Secured Obligations are unenforceable or not allowable due to the existence
of a bankruptcy, reorganization or similar proceeding involving the undersigned
or any Grantor.
Section 3. Supplements to Security Agreement Schedules. The undersigned has
attached hereto supplements to each of the Schedules to the Security Agreement,
and the undersigned hereby certifies, as of the date first above written, that
such supplements have been prepared by the undersigned in substantially the form
of the Schedules to the Security Agreement and are complete and correct in all
material respects.
Section 4. Representations and Warranties. The undersigned hereby makes
each representation and warranty set forth in Section 7 of the Security
Agreement (as supplemented by the attached supplements) to the same extent as
each other Grantor.
Section 5. Obligations Under the Security Agreement. The undersigned hereby
agrees, as of the date first above written, to be bound as a Grantor by all of
the terms and provisions of the Security Agreement to the same extent as each of
the other Grantors. The undersigned further agrees, as of the date first above
written, that each reference in the Security Agreement to an "Additional
Grantor" or a "Grantor" shall also mean and be a reference to the undersigned,
and each reference in any of the other Loan Documents to a "Grantor" or a "Loan
Party" shall also mean and be a reference to the undersigned.
Section 6. Governing Law; Jurisdiction; Etc. This Security Agreement
Supplement shall be governed by and construed in accordance with the laws of the
State of New York.
Very truly yours,
[NAME OF ADDITIONAL GRANTOR]
By_______________________________
Title:
Address of principal place of
business and chief executive
office and for notices:
----------------------------------
----------------------------------
EXHIBIT B TO THE
SECURITY AGREEMENT
FORM OF PLEDGED ACCOUNT LETTER
---------------, ----
[Name and address
of Pledged Account Bank]
[Name of the Grantor]
Gentlemen/women:
Reference is made to [the lockboxes listed on Schedule I hereto into which
certain monies, instruments and other properties are deposited from time to time
and] the deposit accounts listed on Schedule I hereto (such [lockboxes and]
deposit accounts being, collectively, the "Pledged Accounts") maintained with
you by ____________________ (the "Grantor"). Pursuant to the Security Agreement
dated January __, 1999 (as amended, amended and restated, supplemented or
otherwise modified from time to time, the "Security Agreement"), the Grantor has
granted to NationsBank, N.A., as Collateral Agent (together with any successor
collateral agent appointed pursuant to Article VIII of the Credit Agreement, the
"Collateral Agent") for the Secured Parties referred to in the Credit Agreement
dated as of January __, 1999 (the "Credit Agreement"), with [MEDE AMERICA
CORPORATION][MEDE AMERICA CORPORATION OF OHIO][HEALTHCARE INTERCHANGE, INC.] and
the Grantor, sole dominion and control of the Pledged Accounts and a security
interest in certain property of the Grantor, including, among other things, the
following (the "Account Collateral"): each Pledged Account, all funds held
therein and all certificates and instruments, if any, from time to time
representing or evidencing such Pledged Account, all interest, dividends,
distributions, cash, instruments and other property from time to time received,
receivable or otherwise distributed in respect of or in exchange for any or all
of the then existing Account Collateral and all proceeds of any and all of the
foregoing Account Collateral and, to the extent not otherwise included, all (i)
payments under insurance (whether or not the Collateral Agent is the loss payee
thereof), or any indemnity, warranty or guaranty, payable by reason of loss or
damage to or otherwise with respect to any of the foregoing Account Collateral
and (ii) cash. It is a condition to the continued maintenance of the Pledged
Accounts with you that you agree to this letter agreement.
By executing this letter agreement, you acknowledge notice of, and consent
to the terms and provisions of, the Security Agreement and the grant of the lien
on, and security interest in, and the pledge and assignment of, the Account
Collateral to the Collateral Agent for the benefit of the Secured Parties and
you confirm to the Collateral Agent that the description of the
2
Pledged Accounts set forth on Schedule I hereto is correct and that you have not
received any notice of any other lien on, security interest in, pledge or
assignment of, or other claim (other than that of the Grantor) on any of the
Pledged Accounts. Further, you hereby agree with the Collateral Agent that:
(a) Notwithstanding anything to the contrary in any other
agreement relating to any Pledged Account, each Pledged Account is and
will be subject to the terms and conditions of the Security Agreement,
will be maintained solely for the benefit of the Secured Parties, will
have the title set forth opposite the account number therefor on
Schedule I hereto and will be subject to written instructions only from
an officer of the Collateral Agent. Only the Collateral Agent is
authorized to withdraw amounts from, to draw upon, or, except as
otherwise set forth herein, to otherwise exercise any powers with
respect to the Pledged Accounts and the funds deposited therein. The
Collateral Agent authorizes and directs that the sole signatories
authorized to act on behalf of the Collateral Agent with respect to the
Pledged Accounts are and shall be such vice presidents of the
Collateral Agent as the Collateral Agent may from time to time
designate in a writing acceptable to you. You may rely without
liability on any such written designation, absent manifest error,
unless and until you receive a written designation to the contrary. Any
such written designation shall include the specimen signature of each
authorized vice president of the Collateral Agent.
(b) You will collect mail from each Pledged Account on each of
your business days at times that coincide with the delivery of mail
thereto.
(c) You will follow your usual operating procedures for the
handling of any remittance that contains restrictive endorsements,
irregularities (such as a variance between the written and numerical
amounts), undated or postdated items, missing signatures, incorrect
payees, etc. received in any Pledged Account.
(d) You will endorse and process all eligible checks and other
remittance items not covered by paragraph (c) and deposit such checks
and remittance items in the Pledged Accounts.
(e) You will maintain a record of all checks and other
remittance items received in each Pledged Account and, in addition to
providing the Grantor with photostats, vouchers, enclosures, etc. of
such checks and remittance items on a daily basis, furnish to the
Collateral Agent (i) a monthly statement of each Pledged Account and
(ii) a daily collection and check float report, to be mailed or
telecopied to the Collateral Agent at: NationsBank, N.A., c/o Bank of
America National Trust and Savings Association, Agency Management
#10831, 0000 Xxxxxx Xxxxxx, 00xx Xxxxx, Xxx Xxxxxxxxx, Xxxxxxxxxx
00000, Telecopier No. (000) 000-0000, Attention: Agency Management.
3
(f) At the direction of the Grantor or the Collateral Agent
(which shall be given to you upon the occurrence and during the
continuance of an Event of Default under the Credit Agreement) you will
transfer, in same day funds, on each of your business days, all amounts
collected from each Pledged Account on such day to the following
account (the "Collateral Account"):
MEDE AMERICA CORPORATION
Account No. __________
000 Xxxxx Xxxxx Xxxxxx
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000
Attention: Xxxxx Xxxxxxxx
Each such transfer of funds shall neither comprise only part of a
remittance nor reflect the rounding off of any funds so transferred.
(g) All transfers referred to in paragraph (f) above shall be
made by you irrespective of, and without deduction for, any
counterclaim, defense, recoupment or set-off and shall be final, and
you will not seek to recover from the Collateral Agent for any reason
any such payment once made.
(h) All service charges and fees with respect to any Pledged
Account shall be payable by the Grantor, and deposited checks returned
for any reason shall not be charged to the applicable Pledged Account,
but may be charged to another account maintained by the Grantor with
you.
(i) The Collateral Agent shall be entitled to exercise any and
all rights of the Grantor in respect of the Pledged Accounts and the
other Account Collateral in accordance with the terms of the Security
Agreement, and you shall comply in all respects with such exercise.
You hereby represent and warrant that the person executing
this letter agreement on your behalf is duly authorized to do so.
No amendment or waiver of any provision of this letter
agreement, nor consent to any departures by you or the Grantor herefrom, shall
be effective unless the same shall be in writing as signed by you, the Grantor
and the Collateral Agent.
This letter agreement shall be binding upon you and your
successors and assigns and shall inure to the benefit of the Secured Parties and
their successors, transferees and assigns. You may terminate this letter
agreement upon thirty days' prior written notice to the Grantor and the
Collateral Agent. Upon such termination you shall close the Pledged Accounts and
transfer all funds in the Pledged Accounts to the Collateral Account or another
account as instructed by
4
the Collateral Agent at such time. After any such termination, you shall
nonetheless remain obligated promptly to transfer to the Collateral Account or
to such other account as instructed by the Collateral Agent at such time all
funds and other property received in respect of the Pledged Accounts.
This letter 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 all of which when taken together
shall constitute one and the same agreement. Delivery of an executed counterpart
of a signature page to this letter agreement by telecopier shall be effective as
delivery of an original executed counterpart of this letter agreement.
Please indicate your acknowledgment of and agreement to the provisions of
this letter agreement by signing in the appropriate space provided below and
returning this letter agreement to NationsBank, N.A., as Administrative Agent
c/o Bank of America National Trust and Savings Association, Agency Management
#10831, 0000 Xxxxxx Xxxxxx, 00xx Xxxxx, Xxx Xxxxxxxxx, Xxxxxxxxxx 00000,
Telecopier No.: (000) 000-0000, Attention: Agency Management. If you elect to
deliver this letter agreement by telecopier, please arrange for the executed
original to follow by next-day courier.
This letter agreement shall be governed by and construed in accordance with
the laws of the State of New York.
Very truly yours,
[NAME OF GRANTOR]
By __________________________________
Title:
NATIONSBANK, N.A., as Collateral Agent
By ___________________________________
Title:
5
Acknowledged and agreed to as of
the date first above written:
[NAME OF PLEDGED ACCOUNT BANK]
By _____________________________
Title:
SCHEDULE I TO THE
PLEDGED ACCOUNT LETTER
[LOCKBOX/] ACCOUNT NUMBER [LOCKBOX/] ACCOUNT NAME
EXHIBIT C TO THE
SECURITY AGREEMENT
FORM OF CONSENT AND AGREEMENT
The undersigned hereby (a) acknowledges notice of, and consents to the
terms and provisions of, the Security Agreement dated January __, 1999 (as
amended, amended and restated, supplemented or otherwise modified from time to
time, the "Security Agreement", the terms defined therein being used herein as
therein defined) from [MEDE AMERICA CORPORATION][MEDE AMERICA CORPORATION OF
OHIO][HEALTHCARE INTERCHANGE, INC.] (the "Grantor") and certain other grantors
from time to time party thereto to NationsBank, N.A., as Collateral Agent (the
"Collateral Agent") for the Secured Parties referred to therein, (ii) consents
in all respects to the pledge and assignment to the Collateral Agent of all of
the Grantor's right, title and interest in, to and under the Assigned Agreement
(as defined below) pursuant to the Security Agreement, (iii) acknowledges that
the Grantor has provided it with notice of the right of the Collateral Agent in
the exercise of its rights and remedies under the Security Agreement to make all
demands, give all notices, take all actions and exercise all rights of the
Grantor under the Assigned Agreement, and (iv) agrees with the Collateral Agent
that:
(i) The undersigned will make all payments to be made by it
under or in connection with the __________ Agreement dated
_______________, ____ (the "Assigned Agreement") between the
undersigned and the Grantor directly to the Collateral Account or
otherwise in accordance with the instructions of the Collateral Agent.
(ii) All payments referred to in paragraph (i) above shall be
made by the undersigned irrespective of, and without deduction for, any
counterclaim, defense, recoupment or set-off and shall be final, and
the undersigned will not seek to recover from any Secured Party for any
reason any such payment once made.
(iii) The Collateral Agent or its designee shall be entitled
to exercise any and all rights and remedies of the Grantor under the
Assigned Agreement in accordance with the terms of the Security
Agreement, and the undersigned shall comply in all respects with such
exercise.
(iv) The undersigned will not, without the prior written
consent of the Collateral Agent, (A) cancel or terminate the Assigned
Agreement or consent to or accept any cancellation or termination
thereof, or (B) amend, amend and restate, supplement or otherwise
modify the Assigned Agreement, except, in each case, to the extent
otherwise permitted under the Credit Agreement referred to in the
Security Agreement.
(v) In the event of a default by the Grantor in the
performance of any of its obligations under the Assigned Agreement, or
upon the occurrence or non-occurrence of any event or condition under
the Assigned Agreement which would immediately or with the passage of
any applicable grace period or the giving of notice, or both, enable
the undersigned to terminate or suspend its obligations under the
Assigned Agreement, the undersigned shall not terminate the Assigned
Agreement until it first gives written notice thereof to the Collateral
Agent and permits the Grantor and the Collateral Agent the period of
time afforded to the Grantor under the Assigned Agreement to cure such
default.
(vi) The undersigned shall deliver to the Collateral Agent,
concurrently with the delivery thereof to the Grantor, a copy of each
notice, request or demand given by the undersigned pursuant to the
Assigned Agreement.
(vii) Except as specifically provided in this Consent and
Agreement, neither the Collateral Agent nor any other Secured Party
shall have any liability or obligation under the Assigned Agreement as
a result of this Consent and Agreement, the Security Agreement or
otherwise.
This Consent and Agreement shall be binding upon the undersigned and its
successors and assigns, and shall inure, together with the rights and remedies
of the Collateral Agent hereunder, to the benefit of the Secured Parties and
their successors, transferees and assigns. This Consent and Agreement shall be
governed by and construed in accordance with the laws of the State of New York.
IN WITNESS WHEREOF, the undersigned has duly executed this Consent and
Agreement as of the date set opposite its name below.
Dated: _______________, ____ [NAME OF OBLIGOR]
By ______________________________
Title:
EXHIBIT D TO THE
SECURITY AGREEMENT
FORM OF CONTROL AGREEMENT
(Securities Account)
CONTROL AGREEMENT dated as of ________, ____, among____________, a
___________ (the "Grantor"), NationsBank, N.A., as Collateral Agent (the
"Secured Party"), and _________, a _________ ("____________"), as securities
intermediary (the "Securities Intermediary").
PRELIMINARY STATEMENTS:
(1) The Grantor has granted the Secured Party a security interest (the
"Security Interest") in account no. _______________ maintained by the Securities
Intermediary for the Grantor (the "Account").
(2) Terms defined in Article 8 or 9 of the Uniform Commercial Code in
effect in the State of New York ("N.Y. Uniform Commercial Code") are used in
this Agreement as such terms are defined in such Article 8 or 9.
NOW, THEREFORE, in consideration of the premises and of the mutual
agreements contained herein, the parties hereto hereby agree as follows:
SECTION 1. The Account. The Securities Intermediary represents and warrants
to, and agrees with, the Secured Party that:
(a) The Securities Intermediary maintains the Account for the
Grantor, and all property held by the Securities Intermediary for the
account of the Grantor is, and will continue to be, credited to the
Account.
(b) The Account is a securities account. The Securities
Intermediary is the securities intermediary with respect to the
property credited from time to time to the Account. The Grantor is the
entitlement holder with respect to the property credited from time to
time to the Account.
(c) The securities intermediary's jurisdiction with respect to
the Account is, and will continue to be for so long as the Security
Interest shall be in effect, the State of New York.
(d) Exhibit A attached hereto is a statement of the property
credited to the Account on the date hereof.
(e) The Securities Intermediary does not know of any claim to
or interest in the Account or any property credited to the Account,
except for claims and interests of the parties referred to in this
Agreement.
SECTION 2. Control by Secured Party. The Securities Intermediary will
comply with all notifications it receives directing it to transfer or redeem any
property in the Account (each an "Entitlement Order") or other directions
concerning the Account (including, without limitation, directions to distribute
to the Secured Party proceeds of any such transfer or redemption or interest or
dividends on property in the Account) originated by the Secured Party without
further consent by the Grantor or any other person.
SECTION 3. Grantor's Rights in Account.
(a) The Securities Intermediary will comply with Entitlement Orders and
other directions concerning the Account originated by, and only by, the Secured
Party.
(b) Until the Securities Intermediary receives a notice from the Secured
Party that the Secured Party will exercise exclusive control over the Account (a
"Notice of Exclusive Control"), the Securities Intermediary may distribute to
the Grantor all interest and regular cash dividends on property in the Account.
(c) If the Securities Intermediary receives from the Secured Party a Notice
of Exclusive Control, the Securities Intermediary will cease distributing to the
Grantor all interest and dividends on property in the Account.
SECTION 4. Priority of Secured Party's Security Interest. (a) The
Securities Intermediary subordinates in favor of the Secured Party any security
interest, lien, or right of setoff it may have, now or in the future, against
the Account or property in the Account, except that the Securities Intermediary
will retain its prior lien on property in the Account to secure payment for
property purchased for the Account and normal commissions and fees for the
Account.
(b) The Securities Intermediary will not agree with any third party that
the Securities Intermediary will comply with Entitlement Orders originated by
the third party.
SECTION 5. Statements, Confirmations, and Notices of Adverse Claims. (a)
The Securities Intermediary will send copies of all statements and confirmations
for the Account simultaneously to the Grantor and the Secured Party.
(b) When the Securities Intermediary knows of any claim or interest in the
Account or any property credited to the Account other than the claims and
interests of the parties
referred to in this Agreement, the Securities Intermediary will promptly notify
the Secured Party and the Grantor of such claim or interest.
SECTION 6. The Securities Intermediary's Responsibility. (a) Except for
permitting a withdrawal, delivery, or payment in violation of Section 3, the
Securities Intermediary will not be liable to the Secured Party for complying
with Entitlement Orders or other directions concerning the Account from the
Grantor that are received by the Securities Intermediary before the Securities
Intermediary receives and has a reasonable opportunity to act on a Notice of
Exclusive Control.
(b) The Securities Intermediary will not be liable to the Grantor for
complying with a Notice of Exclusive Control or with an Entitlement Order or
other direction concerning the Account originated by the Secured Party, even if
the Grantor notifies the Securities Intermediary that the Secured Party is not
legally entitled to issue the Notice of Exclusive Control or Entitlement Order
or such other direction unless the Securities Intermediary takes the action
after it is served with an injunction, restraining order, or other legal process
enjoining it from doing so, issued by a court of competent jurisdiction, and had
a reasonable opportunity to act on the injunction, restraining order or other
legal process.
(c) This Agreement does not create any obligation of the Securities
Intermediary except for those expressly set forth in this Agreement and in Part
5 of Article 8 of the N.Y. Uniform Commercial Code. In particular, the
Securities Intermediary need not investigate whether the Secured Party is
entitled under the Secured Party's agreements with the Grantor to give an
Entitlement Order or other direction concerning the Account or a Notice of
Exclusive Control. The Securities Intermediary may rely on notices and
communications it believes given by the appropriate party.
SECTION 7. Indemnity. The Grantor will indemnify the Securities
Intermediary, its officers, directors, employees and agents against claims,
liabilities and expenses arising out of this Agreement (including, without
limitation, reasonable attorney's fees and disbursements), except to the extent
the claims, liabilities or expenses are caused by the Securities Intermediary's
gross negligence or willful misconduct as found by a court of competent
jurisdiction in a final, non-appealable judgment.
SECTION 8. Termination; Survival. (a) The Secured Party may terminate this
Agreement by notice to the Securities Intermediary and the Grantor. If the
Secured Party notifies the Securities Intermediary that the Security Interest
has terminated, this Agreement will immediately terminate.
(b) The Securities Intermediary may terminate this Agreement on 60 days'
prior notice to the Secured Party and the Grantor, provided that before such
termination the Securities Intermediary and the Grantor shall make arrangements
to transfer the property in the Account to another securities intermediary that
shall have executed, together with the Grantor, a
control agreement in favor of the Secured Party in respect of such property in
substantially the form of this Agreement or otherwise in form and substance
satisfactory to the Secured Party.
(c) Sections 6 and 7 will survive termination of this Agreement.
SECTION 9. Governing Law. This Agreement and the Account will be governed
by the law of the State of New York. The Securities Intermediary and the Grantor
may not change the law governing the Account without the Secured Party's express
prior written agreement.
SECTION 10. Entire Agreement. This Agreement is the entire agreement, and
supersedes any prior agreements, and contemporaneous oral agreements, of the
parties concerning its subject matter.
SECTION 11. Amendments. No amendment of, or waiver of a right under, this
Agreement will be binding unless it is in writing and signed by the party to be
charged.
SECTION 12. Financial Assets. The Securities Intermediary agrees with the
Secured Party and the Grantor that, to the fullest extent permitted by
applicable law, all property credited from time to time to the Account will be
treated as financial assets under Article 8 of the N.Y. Uniform Commercial Code.
SECTION 13. Notices. A notice or other communication to a party under this
Agreement will be in writing (except that Entitlement Orders may be given
orally), will be sent to the party's address set forth under its name below or
to such other address as the party may notify the other parties and will be
effective on receipt.
SECTION 14. Binding Effect. This Agreement shall become effective when it
shall have been executed by the Grantor, the Secured Party and the Securities
Intermediary, and thereafter shall be binding upon and inure to the benefit of
the Grantor, the Secured Party and the Securities Intermediary and their
respective successors and assigns.
SECTION 15. Execution in 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 all of which taken together shall constitute one and the same agreement.
Delivery of an executed counterpart of a signature page to this Agreement by
telecopier shall be effective as delivery of an original executed counterpart of
this Agreement.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their respective officers thereunto duly authorized, as of the date
first above written.
[NAME OF GRANTOR]
By ________________________________
Title:
Address:
____________________________________
____________________________________
NATIONSBANK, N.A., as
Collateral Agent
By ________________________________
Title:
Address:
0000 Xxxxxx Xxxxxx, 00xx Xxxxx,
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
[NAME OF SECURITIES
INTERMEDIARY]
By ________________________________
Title:
Address:
____________________________________
____________________________________
SCHEDULE I TO THE SECURITY AGREEMENT
PLEDGED SHARES AND PLEDGED DEBT
PART I
STOCK NUMBER PERCENTAGE OF
GRANTOR STOCK ISSUER CLASS OF STOCK PAR VALUE CERTIFICATE OF SHARES OUTSTANDING
------- ------------ -------------- --------- ------------ --------- -----------
Borrower Healthcare Interchange, Inc. Class A Com. $1.00 A-1 35,000 100%
Borrower Healthcare Interchange, Inc. Class B Com. $1.00 B-2 35,000 100%
Borrower Healthcare Interchange, Inc. Class C Com. $1.00 C-6 1 0%
Borrower Healthcare Interchange, Inc. Class C Com. $1.00 C-5 5,000 25%
Borrower Healthcare Interchange, Inc. Class C Com. $1.00 C-6 5,000 25%
Borrower Healthcare Interchange, Inc. Class C Com. $1.00 C-7 5,000 25%
Borrower Healthcare Interchange, Inc. Class C Com. $1.00 C-8 5,000 25%
Borrower Healthcare Interchange, Inc. Cum. Conv. $1.00 1 31,250 50%
Preferred
Borrower Healthcare Interchange, Inc. Cum. Conv. $1.00 3 31,250 50%
Preferred
Borrower MedE America Corporation Common $ .01 1 100 100%
of Ohio
PART II
None.
SCHEDULE II TO THE SECURITY AGREEMENT
LOCATIONS OF EQUIPMENT AND INVENTORY
MedE America Corporation
0000 Xxxx Xxxxxxx
Xxxxxxxxx XX (Summit County)
00 Xxxxxxx Xxx., Xxxxx 000
Xxxx Xxxxxx, XX 00000 (Nassau County)
0000 Xxxxxxx Xxxx, Xxxxx 000
Xxxxxxx, XX. 00000 (Gwinnett County)
0000 Xxxxxxx Xxxx
Xxxx Xxxxxx, XX 00000 (Erie County)
0 Xxxxxxx Xxxxx
Xxxxxx, XX 00000
000 Xxxxxxxx Xxxx., Xxxxx 000
Xxxxxxx Xxxxx, XX 00000 (Nassau County)
00000 Xxxxxxx Xxxx.
Xxxxxxxx Xxxxx, XX. 00000
See also the locations set forth below for MedE America Corporation of
Ohio and Healthcare Interchange, Inc..
MedE America Corporation of Ohio
0000 Xxxxxx Xx.
Xxxxxxxxx, XX 00000 (Summit County)
000 X. Xxxxx Xx.
Xxxxxx, XX (Clermont County)
000 Xxxxx Xxxxx Xxxxxx
Xxxxxxxxxx, XX 00000
SCHEDULE II TO THE SECURITY AGREEMENT (CONTINUED)
LOCATIONS OF EQUIPMENT AND INVENTORY
MedE America Corporation of Ohio (continued)
000 Xxxxxxx Xxxx.
Xxxxxxxxxxx, XX 00000 (Spartanburg County)
Healthcare Interchange, Inc.
000 Xxxxx Xxxxx Xxxxxx, Xxxxx Xxxxx
Xxxxx Xxxxx, XX 00000
SCHEDULE III TO THE SECURITY AGREEMENT
CHIEF PLACE OF BUSINESS, CHIEF EXECUTIVE OFFICE
AND FEDERAL TAX IDENTIFICATION NUMBER
CHIEF PLACE OF BUSINESS AND FEDERAL TAX
GRANTOR CHIEF EXECUTIVE OFFICE IDENTIFICATION NO.
------- ---------------------- ------------------
MedE America Corporation 00 Xxxxxxx Xxxxxx, Xxxxx 000 00-0000000
Xxxx Xxxxxx, Xxx Xxxx 00000
XxxX Xxxxxxx Corporation of Chief Executive Office: 00-0000000
Ohio 00 Xxxxxxx Xxxxxx, Xxxxx 000
Xxxx Xxxxxx, Xxx Xxxx 00000
Chief Place of Business:
0000 Xxxxxx Xx.
Xxxxxxxxx, XX 00000
Healthcare Interchange, Inc. Chief Executive Office: 00-0000000
00 Xxxxxxx Xxxxxx, Xxxxx 000
Xxxx Xxxxxx, Xxx Xxxx 11554
Chief Place of Business:
000 Xxxxx Xxxxx Xxxxxx, Xxxxx Xxxxx
Xxxxx Xxxxx, XX 00000
SCHEDULE IV TO THE SECURITY AGREEMENT
TRADE NAMES
GRANTOR TRADE NAMES
------- -----------
MedE America Corporation MedE America Corporation
MedE America
MedE America Corporation of Ohio MedE America Corporation of Ohio
General Computer Corporation*
Healthcare Interchange, Inc. Healthcare Interchange, Inc.
SCHEDULE V TO THE SECURITY AGREEMENT
PLEDGED ACCOUNTS
None.
EXHIBIT E
FORM OF
GUARANTY SUPPLEMENT
--------- --, ----
NationsBank, N.A., as Administrative Agent
c/o Bank of America National Trust
and Savings Association
Agency Management #10831
0000 Xxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxxxxxxx, XX 00000
Attention: Agency Management
Credit Agreement dated as of January __, 1999 among MEDE
AMERICA CORPORATION, a Delaware corporation (the
"Borrower"), the other Loan Parties
party to the Credit Agreement, the Lenders
party to the Credit Agreement,
and NationsBank, N.A., as Administrative Agent
Ladies and Gentlemen:
Reference is made to the above-captioned Credit Agreement and to the
Guaranty referred to therein (such Guaranty, as in effect on the date hereof and
as it may hereafter be amended, supplemented or otherwise modified from time to
time, together with this Guaranty Supplement, being the "Guaranty"). The
capitalized terms defined in the Credit Agreement and not otherwise defined
herein are used herein as therein defined.
Section 1. Guaranty; Limitation of Liability. (a) The undersigned hereby
absolutely, unconditionally and irrevocably guarantees the punctual payment when
due, whether at scheduled maturity or on any date of a required prepayment or by
acceleration, demand or otherwise, of all Obligations of each other Loan Party
now or hereafter existing under or in respect of the Loan Documents (including,
without limitation, any extensions, modifications, substitutions, amendments or
renewals of any or all of the foregoing Obligations), whether direct or
indirect, absolute or contingent, and whether for principal, interest, premium,
fees, indemnities, contract causes of action, costs, expenses or otherwise (such
Obligations being the
2
"Guaranteed Obligations"), and agrees to pay any and all expenses (including,
without limitation, fees and expenses of counsel) incurred by the Administrative
Agent or any other Secured Party in enforcing any rights under this Guaranty
Supplement, the Guaranty or any other Loan Document. Without limiting the
generality of the foregoing, the undersigned's liability shall extend to all
amounts that constitute part of the Guaranteed Obligations and would be owed by
any other Loan Party to any Secured Party under or in respect of the Loan
Documents but for the fact that they are unenforceable or not allowable due to
the existence of a bankruptcy, reorganization or similar proceeding involving
such other Loan Party.
(b) The undersigned, and by its acceptance of this Guaranty Supplement, the
Administrative Agent and each other Secured Party, hereby confirms that it is
the intention of all such Persons that this Guaranty Supplement, the Guaranty
and the Obligations of the undersigned hereunder and thereunder not constitute a
fraudulent transfer or conveyance for purposes of Bankruptcy Law, the Uniform
Fraudulent Conveyance Act, the Uniform Fraudulent Transfer Act or any similar
foreign, federal or state law to the extent applicable to this Guaranty
Supplement, the Guaranty and the Obligations of the undersigned hereunder and
thereunder. To effectuate the foregoing intention, the Administrative Agent, the
other Secured Parties and the undersigned hereby irrevocably agree that the
Obligations of the undersigned under this Guaranty Supplement and the Guaranty
at any time shall be limited to the maximum amount as will result in the
Obligations of the undersigned under this Guaranty Supplement and the Guaranty
not constituting a fraudulent transfer or conveyance.
(c) The undersigned hereby unconditionally and irrevocably agrees that in
the event any payment shall be required to be made to any Secured Party under
this Guaranty Supplement, the Guaranty or any other guaranty, the undersigned
will contribute, to the maximum extent permitted by applicable law, such amounts
to each other Guarantor and each other guarantor so as to maximize the aggregate
amount paid to the Secured Parties under or in respect of the Loan Documents.
Section 2. Obligations Under the Guaranty. The undersigned hereby agrees,
as of the date first above written, to be bound as a Guarantor by all of the
terms and conditions of the Guaranty to the same extent as each of the other
Guarantors thereunder. The undersigned further agrees, as of the date first
above written, that each reference in the Guaranty to an "Additional Guarantor"
or a "Guarantor" shall also mean and be a reference to the undersigned, and each
reference in any other Loan Document to a "Guarantor" or a "Loan Party" shall
also mean and be a reference to the undersigned.
Section 3. Representations and Warranties. The undersigned hereby makes
each representation and warranty set forth in Section 4.01 of the Credit
Agreement to the same extent as each other Guarantor.
3
Section 4. Delivery by Telecopier. Delivery of an executed counterpart of a
signature page to this Guaranty Supplement by telecopier shall be effective as
delivery of an original executed counterpart of this Guaranty Supplement.
Section 5. Governing Law; Jurisdiction; Waiver of Jury Trial, Etc. (a) This
Guaranty Supplement shall be governed by, and construed in accordance with, the
laws of the State of New York.
(b) The undersigned hereby irrevocably and unconditionally submits, for
itself and its property, to the nonexclusive jurisdiction of any New York State
court or any federal court of the United States of America sitting in New York
City, and any appellate court from any thereof, in any action or proceeding
arising out of or relating to this Guaranty Supplement, the Guaranty or any of
the other Loan Documents to which it is or is to be a party, or for recognition
or enforcement of any judgment, and the undersigned hereby irrevocably and
unconditionally agrees that all claims in respect of any such action or
proceeding may be heard and determined in any such New York State court or, to
the extent permitted by law, in such federal court. The undersigned agrees that
a final judgment in any such action or proceeding shall be conclusive and may be
enforced in other jurisdictions by suit on the judgment or in any other manner
provided by law. Nothing in this Guaranty Supplement or the Guaranty or any
other Loan Document shall affect any right that any party may otherwise have to
bring any action or proceeding relating to this Guaranty Supplement, the
Guaranty or any of the other Loan Documents to which it is or is to be a party
in the courts of any other jurisdiction.
(c) The undersigned irrevocably and unconditionally waives, to the fullest
extent it may legally and effectively do so, any objection that it may now or
hereafter have to the laying of venue of any suit, action or proceeding arising
out of or relating to this Guaranty Supplement, the Guaranty or any of the other
Loan Documents to which it is or is to be a party in any New York State or
federal court. The undersigned hereby irrevocably waives, to the fullest extent
permitted by law, the defense of an inconvenient forum to the maintenance of
such suit, action or proceeding in any such court.
(d) THE UNDERSIGNED HEREBY IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY JURY IN
ANY ACTION, PROCEEDING OR COUNTERCLAIM (WHETHER BASED ON CONTRACT, TORT OR
OTHERWISE) ARISING OUT OF OR RELATING TO ANY OF THE LOAN DOCUMENTS, THE WORKING
CAPITAL ADVANCES OR THE ACTIONS OF ANY SECURED PARTY IN THE NEGOTIATION,
ADMINISTRATION, PERFORMANCE OR ENFORCEMENT THEREOF.
Very truly yours,
[NAME OF ADDITIONAL GUARANTOR]
By _______________________________
Title:
