EXHIBIT 10.17
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IMAGISTICS INTERNATIONAL INC.,
as Borrower,
and
THE GUARANTORS PARTY HERETO
______________________
$225,000,000
CREDIT AGREEMENT
Dated as of November [ ], 2001
______________________
XXXXXXX XXXXX & CO.,
XXXXXXX LYNCH, PIERCE, XXXXXX & XXXXX INCORPORATED,
as Lead Arranger, Sole Book-Runner and Syndication Agent,
and
FLEET CAPITAL CORPORATION,
as Administrative Agent,
and
MIZUHO FINANCIAL GROUP,
as Documentation Agent,
and
THE LENDERS PARTY HERETO
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TABLE OF CONTENTS
This Table of Contents is not part of the Agreement to which it is
attached but is inserted for convenience of reference only.
Page
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Section 1. Definitions, Accounting Matters and Rules of Construction....................... 1
1.01. Certain Defined Terms........................................................... 1
1.02. Accounting Terms and Determinations............................................. 37
1.03. Classes and Types of Loans...................................................... 38
1.04. Rules of Construction........................................................... 38
Section 2. Commitments, Letters of Credit, Conversions and Continuations, Fees,
Register, Prepayments and Replacement of Lenders................................ 39
2.01. Loans........................................................................... 39
2.02. Borrowings...................................................................... 41
2.03. Letters of Credit............................................................... 41
2.04. Termination and Reductions of Commitments....................................... 46
2.05. Fees............................................................................ 47
2.06. Lending Offices................................................................. 47
2.07. Several Obligations of Lenders.................................................. 47
2.08. Notes; Register................................................................. 47
2.09. Optional Prepayments and Conversions or Continuations of Loans.................. 48
2.10. Mandatory Prepayments and Commitment Reductions................................. 48
2.11. Replacement of Lenders.......................................................... 50
Section 3. Payments of Principal and Interest.............................................. 51
3.01. Repayment of Loans.............................................................. 51
3.02. Interest........................................................................ 51
Section 4. Payments; Pro Rata Treatment; Computations; Etc................................. 52
4.01. Payments........................................................................ 52
4.02. Pro Rata Treatment.............................................................. 53
4.03. Computations.................................................................... 53
4.04. Minimum Amounts................................................................. 53
4.05. Certain Notices................................................................. 54
4.06. Non-Receipt of Funds by Administrative Agent.................................... 55
4.07. Right of Setoff; Sharing of Payments; Etc....................................... 00
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Xxxxxxx 0. Yield Protection, Etc........................................................... 57
5.01. Additional Costs................................................................ 57
5.02. Inability To Determine Interest Rate............................................ 59
5.03. Illegality...................................................................... 59
5.04. Treatment of Affected Loans..................................................... 59
5.05. Compensation.................................................................... 60
5.06. Net Payments.................................................................... 60
Section 6. Guarantee....................................................................... 63
6.01. The Guarantee................................................................... 63
6.02. Obligations Unconditional....................................................... 63
6.03. Reinstatement................................................................... 64
6.04. Subrogation; Subordination...................................................... 64
6.05. Remedies........................................................................ 65
6.06. Continuing Guarantee............................................................ 65
6.07. General Limitation on Guarantee Obligations..................................... 65
Section 7. Conditions Precedent............................................................ 65
7.01. Conditions to Effectiveness..................................................... 65
7.02. Conditions to Initial Extension of Credit....................................... 66
7.03. Conditions to Initial and Subsequent Extensions of Credit....................... 69
7.04. Determinations Under Section 7.................................................. 70
Section 8. Representations and Warranties.................................................. 70
8.01. Corporate Existence; Compliance with Law........................................ 70
8.02. Financial Condition; Etc........................................................ 70
8.03. Litigation...................................................................... 71
8.04. No Breach....................................................................... 71
8.05. Action.......................................................................... 71
8.06. Approvals....................................................................... 72
8.07. ERISA and Foreign Employee Benefit Matters...................................... 72
8.08. Taxes........................................................................... 72
8.09. Investment Company Act; Public Utility Holding Company Act; Other............... 72
Restrictions
8.10. Environmental Matters........................................................... 73
8.11. Use of Proceeds................................................................. 73
8.12. Subsidiaries, Etc............................................................... 73
8.13. Ownership of Property; Liens.................................................... 74
8.14. Security Interest; Absence of Financing Statements; Etc......................... 74
8.15. Licenses and Permits............................................................ 74
8.16. True and Complete Disclosure.................................................... 74
8.17. Solvency........................................................................ 75
8.18. Contracts....................................................................... 75
8.19. Labor Matters................................................................... 75
8.20. Intellectual Property........................................................... 75
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8.21. Existing Indebtedness........................................................... 76
8.22. Accuracy of Borrowing Base Components........................................... 76
Section 9. Covenants....................................................................... 76
9.01. Financial Statements, Etc....................................................... 76
9.02. Litigation, Etc................................................................. 79
9.03. Existence; Compliance with Law; Payment of Taxes; Inspection Rights;
Performance of Obligations; Etc............................................... 79
9.04. Insurance....................................................................... 80
9.05. Limitation on Lines of Business................................................. 81
9.06. Limitation on Fundamental Changes, Acquisitions or Dispositions................. 81
9.07. Limitation on Liens and Negative Pledges........................................ 84
9.08. Prohibition on Disqualified Capital Stock; Limitation on Indebtedness
and Contingent Obligations.................................................... 85
9.09. Limitation on Investments; Limitation on Creation of Subsidiaries............... 87
9.10. Limitation on Dividend Payments................................................. 88
9.11. Financial Covenants............................................................. 89
9.12. Additional Security; Equal Security for Loans and Notes; Landlord
Consents...................................................................... 91
9.13. Security Interests; Further Assurances.......................................... 92
9.14. Compliance with Environmental Laws.............................................. 92
9.15. Limitation on Transactions with Affiliates and Related Persons.................. 93
9.16. Limitation on Accounting Changes; Limitation on Investment Company
Status........................................................................ 93
9.17. Limitation on Modifications of Certain Documents, Etc........................... 93
9.18. Interest Rate Protection Agreements............................................. 93
9.19. Limitation on Certain Restrictions Affecting Subsidiaries....................... 94
9.20. Additional Obligors............................................................. 94
9.21. Customer Rental Agreements...................................................... 95
Section 10. Events of Default.............................................................. 95
Section 11. Agents......................................................................... 98
11.01. General Provisions.............................................................. 98
11.02. Indemnification................................................................. 100
11.03. Consents Under Other Credit Documents........................................... 100
11.04. Collateral Sub-Agents........................................................... 101
Section 12. Miscellaneous.................................................................. 101
12.01. Waiver.......................................................................... 101
12.02. Notices......................................................................... 101
12.03. Expenses, Indemnification, Etc.................................................. 102
12.04. Amendments, Etc................................................................. 103
12.05. Successors and Assigns.......................................................... 106
12.06. Survival........................................................................ 108
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12.07. Captions........................................................................ 108
12.08. Counterparts; Interpretation; Effectiveness..................................... 108
12.09. Governing Law; Submission to Jurisdiction; Waivers; Etc......................... 109
12.10. Confidentiality................................................................. 109
12.11. Independence of Representations, Warranties and Covenants....................... 110
12.12. Severability.................................................................... 110
12.13. No Reliance on Margin Stock..................................................... 110
Signatures.................................................................................. S-1
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ANNEX A Commitments
ANNEX B - Inventory Locations
SCHEDULE 1.01(a) - Applicable Margins Before Trigger Date
SCHEDULE 1.01(b) - Applicable Margins After Trigger Date
SCHEDULE 1.01(c) - Applicable Revolving Credit Fee Percentage
SCHEDULE 1.01(d) - Guarantors
SCHEDULE 1.01(e) - Excluded Subsidiaries at Effective Date
SCHEDULE 3.01(b) - Amortization Schedule
SCHEDULE 8.02(B) - Certain Contingent Obligations of Companies
SCHEDULE 8.03 - Litigation
SCHEDULE 8.08 - Tax Matters
SCHEDULE 8.10 - Environmental Matters
SCHEDULE 8.13 - Subsidiaries, Etc.
SCHEDULE 8.15 - Security Interests
SCHEDULE 8.20 - Labor Matters
SCHEDULE 8.21 - Intellectual Property Matters
SCHEDULE 8.22(A) - Indebtedness Outstanding as of the Effective Date
SCHEDULE 8.22(B) - Certain Indebtedness to Remain Outstanding After the Closing Date
SCHEDULE 9.04 - Insurance
SCHEDULE 9.07 - Certain Existing Liens
SCHEDULE 9.09 - Investments
SCHEDULE 9.12(C) - Landlord Consents Required at Effective Date
SCHEDULE 9.15 - Existing Affiliate Agreements
SCHEDULE 9.19 - Certain Restrictions Applicable to Subsidiaries
EXHIBIT A-1 - Form of Revolving Note
EXHIBIT A-2 - Form of Term B Facility Note
EXHIBIT A-3 - Form of Swing Loan Note
EXHIBIT B - Form of Intercompany Note
EXHIBIT C-1 - Form of Interest Rate Certificate
EXHIBIT C-2 - Form of Solvency Certificate
EXHIBIT D - Form of Security Agreement
EXHIBIT E-1 - Form of Counsel Opinion at Closing Date
EXHIBIT E-2 - Form of Local Counsel Opinion
EXHIBIT F - Form of Notice of Assignment
EXHIBIT G - Form of Notice of Borrowing
EXHIBIT H - Form of Notice of Conversion/Continuation
EXHIBIT I - Form of Joinder Agreement
EXHIBIT J - Form of Foreign Lender Certificate
EXHIBIT K-1 - Form of Landlord Consent
EXHIBIT K-2 - Form of Bailee Letter
EXHIBIT L - Form of Assignment Agreement
EXHIBIT M - Form of Perfection Certificate
EXHIBIT N - Form of Borrowing Base Certificate
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CREDIT AGREEMENT dated as of November [ ], 2001, among IMAGISTICS
INTERNATIONAL INC., as Borrower; the Guarantors party hereto; each of the
lenders that is a signatory hereto identified under the caption "LENDERS" on the
signature pages hereto or that, pursuant to Section 12.06(b), shall become a
"Lender" hereunder (individually, a "Lender" and, collectively, the "Lenders");
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XXXXXXX XXXXX & CO., XXXXXXX LYNCH, PIERCE, XXXXXX & XXXXX INCORPORATED
("Xxxxxxx Xxxxx"), as sole book-running lead arranger (in such capacity,
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together with its successors in such capacity, the "Lead Arranger"); FLEET
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CAPITAL CORPORATION ("FCC"), as administrative agent (in such capacity, together
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with its successors in such capacity, "Administrative Agent"); MIZUHO FINANCIAL
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GROUP, as documentation agent (in such capacity, together with its successors in
such capacity, "Documentation Agent"); and XXXXXXX XXXXX & CO., XXXXXXX XXXXX,
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XXXXXX, XXXXXX & XXXXX INCORPORATED, as syndication agent (in such capacity,
together with its successors in such capacity, "Syndication Agent").
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The parties hereto agree as follows:
Section 1. Definitions, Accounting Matters and Rules of Construction.
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1.01. Certain Defined Terms. As used herein, the following terms
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shall have the following meanings:
"ABR Loans" shall mean Loans that bear interest at rates based upon
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the Alternate Base Rate.
"Account Debtor" shall mean any Person who is or who may become
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obligated under, with respect to, or on account of, an Account, chattel paper or
a General Intangible.
"Accounts" shall mean "accounts" (as that term is defined in the UCC)
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and any and all supporting obligations in respect thereof; provided, however,
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that the amount of Accounts shall be reduced by 50% of the "advance xxxxxxxx" of
the Obligors.
"Accrued Xxxxxxxx" shall mean, as at any date, Accounts created by the
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Obligors and the BPCs in the ordinary course of their business for which no
xxxx, invoice or other request for payment has been issued to the Account Debtor
as such Accounts are shown on the books and records of the Obligors.
"Acquisition" shall mean, with respect to any Person, any transaction
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or series of related transactions for the direct or indirect (a) acquisition of
all or substantially all of the Property of any other Person, or of any business
or division of any other Person, (b) acquisition of more than 50% of the Equity
Interests of any other Person, or otherwise causing any other Person to become a
Subsidiary of such Person, or (c) merger or consolidation or any other
combination with any other Person.
"Acquisition Consideration" shall mean the purchase consideration for
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any Acquisition and all other payments made and liabilities incurred by any
Company in exchange for, or as part of the purchase price for, any Acquisition,
whether paid in cash or by exchange of Equity Interests or of Property or
otherwise and whether payable at or prior to the consummation of such
Acquisition or
deferred for payment at any future time, whether or not any such future payment
is subject to the occurrence of any contingency, and includes any and all
payments and liabilities representing the purchase price and any assumptions of
liabilities, "earn-outs" and other Profit Payment Agreements and non-competition
agreements, in each case in accordance with, and at the time required under,
GAAP.
"Adjusted Net Income" shall mean, for any period, Consolidated Net
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Income for such period, adjusted by excluding (to the extent taken into account
in the calculation of such Consolidated Net Income) the effect of (a) gains or
losses for such period from sales or other Dispositions not in the ordinary
course of business, and the tax consequences thereof, (b) any non-recurring or
extraordinary items of income (other than the proceeds of business interruption
insurance) or expense for such period and the tax consequences thereof, and (c)
non-cash charges associated with the issuance by Borrower of its Equity
Interests or Equity Rights to employees of any Company.
"Administrative Agent" see the introduction hereto.
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"Administrative Agent's Fee Letter" shall mean the fee letter dated
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November [ ], 2001, between Borrower and Administrative Agent.
"Advance Date" see Section 4.06.
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"Affiliate" shall mean, with respect to any Person, any other Person
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which directly or indirectly controls, or is under common control with, or is
controlled by, such Person. As used in this definition, "control" (including,
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with its correlative meanings, "controlled by" and "under common control with")
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shall mean possession, directly or indirectly, of power to direct or cause the
direction of management or policies (whether through ownership of securities or
partnership or other ownership interests, by contract or otherwise).
"Affiliate Transaction" see Section 9.15.
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"Agent" shall mean any of Administrative Agent, Lead Arranger or
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Syndication Agent.
"Aggregate Offshore Currency Exposure" see Section 2.03(k).
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"Agreement" shall mean this Credit Agreement, as amended from time to
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time.
"Alternate Base Rate" shall mean for any day, the higher of (i) the
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corporate base rate of interest announced by Bank from time to time, changing
when said corporate base rate changes, and (ii) the Federal Funds Rate plus
0.50% per annum. The corporate base rate is not necessarily the lowest rate
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charged by Bank to its customers.
"Amortization Payment" shall mean each scheduled principal payment on
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the Term B Facility Loans set forth in Section 3.01(b).
"Applicable Currency" means, as to any particular payment or Letter of
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Credit, Dollars or the Offshore Currency in which it is denominated or is
payable.
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"Applicable Lending Office" shall mean, for each Lender and for each
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Type of Loan, the "Lending Office" of such Lender (or of an Affiliate of such
Lender) designated for such Type of Loan on the signature pages hereof or such
other office of such Lender (or of an Affiliate of such Lender) as such Lender
may from time to time specify to Administrative Agent and Borrower as the office
by which its Loans of such Type are to be made and maintained.
"Applicable Margin" shall be, for any Type and Class of Loan, (A)
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prior to the Trigger Date, the percentage per annum set forth on Schedule
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1.01(a) for such Type and Class of Loan, and (B) on and after the date (the
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"Trigger Date") which is the first date after the Closing Date on which Borrower
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has delivered to the Lenders the financial statements and Interest Rate
Certificate required by Sections 9.01(a), (b) and (e) and an Officers'
Certificate demonstrating the then applicable Total Leverage Ratio for a fiscal
quarter ended at least six months after the Closing Date, the Applicable Margin
shall be the percentage per annum set forth on Schedule 1.01(b) for such Type
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and Class of Loan set forth opposite the relevant Total Leverage Ratio in such
Schedule as evidenced in the most recent Interest Rate Certificate delivered
hereunder. After the Trigger Date, any change in the Total Leverage Ratio shall
be effective to adjust the Applicable Margin as of the date of receipt by
Administrative Agent of the Interest Rate Certificate most recently delivered
pursuant to Section 9.01(e). If Borrower fails to deliver the financial
statements or Interest Rate Certificate within the times specified in Sections
9.01(a), (b) and (e), the Total Leverage Ratio shall be deemed to be greater
than 1.25:1.0 from the date of any such failure to deliver until Borrower
delivers such Interest Rate Certificate and financial statements.
"Applicable Percentage" shall mean, for the fiscal year ending
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December 31, 2001, 0%, for the fiscal year ending December 31, 2002, 20%, for
the fiscal year ending December 31, 2003, 15%, for the fiscal year ending
December 31, 2004, 20%, and for each fiscal year thereafter, 25%.
"Applicable R/C Fee Percentage" shall mean 0.500% per annum; provided,
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however, that on and after the Trigger Date, the Applicable R/C Fee Percentage
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shall mean the percentage per annum set forth on Schedule 1.01(c), opposite the
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Total Leverage Ratio set forth in the most recent Interest Rate Certificate
delivered hereunder. After the Trigger Date, any change in the Total Leverage
Ratio shall be effective to adjust the Applicable R/C Fee Percentage as of the
date of receipt by Administrative Agent of the Interest Rate Certificate most
recently delivered pursuant to Section 9.01(e). If Borrower fails to deliver
the financial statements and Interest Rate Certificates within the times
specified in Sections 9.01(a), (b) and (e), the Applicable R/C Fee Percentage
shall be deemed to equal 0.500%.
"Approved Fund" shall mean any Fund that is administered or managed by
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(a) a Lender, (b) an Affiliate of a Lender or (c) an entity or an Affiliate of
an entity that administers or manages a Lender.
"Bank" shall mean Fleet National Bank, its successors and assigns.
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"Bankruptcy Code" shall mean the United States Federal Bankruptcy Code
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of 1978, as amended or supplemented.
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"Base Amount" see Section 9.11(c).
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"Borrower" shall mean Imagistics International Inc., a Delaware
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corporation.
"Borrowing Base" shall mean, as at any date, the lesser of: (i) the
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aggregate amount of the Revolving Commitments on such date, or (ii) an amount
equal to (a) the sum, as of the last day the most recently ended month for which
a Borrowing Base Certificate shall have been delivered (but subject to
adjustment in Administrative Agent's Discretion, as set forth in the definitions
of Eligible Receivables, Eligible Rental Assets, Eligible Accrued Xxxxxxxx and
Eligible Inventory), of: 85% of the amount of Eligible Receivables (other than
those of any BPC) outstanding at such date; plus 85% of the amount of Eligible
Rental Assets (other than those of any BPC) outstanding at such date; plus 75%
of the amount of Eligible Accrued Xxxxxxxx (other than those of any BPC)
outstanding at such date; plus the sum of (x) 60% of the value of Eligible
Inventory (other than that of any BPC) excluding parts, and (y) 15% of the value
of Eligible Inventory (other than that of any BPC) consisting of parts; plus the
BPC Borrowing Base; minus (b) the amount outstanding under the Term B Facility
on such date; minus (c) Reserves as of such date; minus (d) if the last day of
the most recently ended month for which a Borrowing Base Certificate shall have
been delivered pursuant to Section 7.02(ii) or 9.01(i) is before the Contra
Accounts Trigger Date, $1,000,000; minus (e) the Offshore Currency Buffer most
recently calculated by Administrative Agent on or prior to such date pursuant to
Section 2.03(k).
"Borrowing Base Certificate" shall mean a certificate of a Financial
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Officer of Borrower, substantially in the form of Exhibit N and appropriately
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completed.
"BPC" shall mean a retail or other business product center owned or
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controlled by any Obligor or any Affiliate or Subsidiary of any Obligor, but
only for so long as the components that would constitute the BPC Borrowing Base
of such retail or business product center are not included in the Enterprise
Resource Planning System of Borrower described to the Lenders before the
Effective Date.
"BPC Account" shall mean an Account of any BPC.
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"BPC Accrued Xxxxxxxx" shall mean Accrued Xxxxxxxx of any BPC.
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"BPC Borrowing Base" shall mean, at any date, the sum of: 75% of the
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amount of Eligible BPC Receivables outstanding at such date; plus 85% of the
amount of Eligible BPC Rental Assets outstanding at such date; plus 75% of the
amount of Eligible BPC Accrued Xxxxxxxx outstanding at such date; plus the sum
of (I) 60% of the value of Eligible BPC Inventory excluding parts, and (II) 15%
of the value of Eligible BPC Inventory consisting of parts.
"BPC Inventory" shall mean all Inventory of any BPC.
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"BPC Rental Assets" shall mean Rental Assets of any BPC.
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"Business Day" shall mean any day, except a Saturday or Sunday, (a)
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on which commercial banks are not authorized or required to close in New York
City and (b) if such day relates to a borrowing of, a payment or prepayment of
principal of or interest on, a Continuation or Conversion of or into, or an
Interest Period for, a LIBOR Loan or a notice by Borrower with respect to any
such borrowing, payment, prepayment, Continuation, Conversion or Interest
Period, that is also a day on which dealings in Dollar deposits are carried out
in the London interbank market.
"Capital Expenditures" shall mean, for any period, any direct or
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indirect (by way of acquisition of securities of a Person or the expenditure of
cash or the transfer of Property or the incurrence of Indebtedness) expenditures
in respect of the purchase or other acquisition of fixed or capital assets
determined in conformity with GAAP, excluding (i) normal replacement and
maintenance programs properly charged to current operations, (ii) any
expenditure in an amount not to exceed the Net Available Proceeds of any
Disposition Event, to the extent such Net Available Proceeds are not required to
be applied to the prepayment of the Loans in accordance with Section
2.10(a)(iii), (iii) any expenditure made with the proceeds of any Excluded
Disposition (other than sales of inventory or Rental Assets in the ordinary
course of business), (iv) expenditures in an amount not to exceed the sum of (x)
the Net Available Proceeds of any Casualty Event to the extent such Net
Available Proceeds are not required to be applied to the prepayment of the Loans
in accordance with Section 2.10(a)(i) and (y) the amount of any applicable
insurance deductibles with respect to such Casualty Event to the extent such
amount is applied as set forth in clause (x) of Section 2.10(a)(i) within the
period specified therein, (v) expenditures to effect Permitted Acquisitions,
(vi) Investments permitted under Section 9.09, (vii) any expenditures in respect
of Rental Assets made with (or in an amount not exceeding) the net proceeds
received by Borrower and its Subsidiaries as consideration from the issuance of
Equity Interests and Equity Rights of Borrower, other than Disqualified Capital
Stock and Equity Interests in respect of Disqualified Capital Stock, and (viii)
the purchase price of equipment to the extent that the consideration therefor
consists of used or surplus equipment being traded in at such time or the
proceeds of a substantially concurrent sale of such used or surplus equipment.
"Capital Lease," as applied to any Person, shall mean any lease of any
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Property by that Person as lessee which, in conformity with GAAP, is required to
be classified and accounted for as a capital lease on the balance sheet of that
Person.
"Capital Lease Obligations" shall mean, for any Person, all
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obligations of such Person to pay rent or other amounts under a Capital Lease,
and, for purposes of this Agreement, the amount of such obligations shall be the
capitalized amount thereof, determined in accordance with GAAP.
"Cash Equivalents" shall mean, for any Person: (a) direct obligations
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of the United States of America, or of any agency thereof, or obligations
guaranteed by the United States of America, or by any agency thereof, in either
case maturing not more than one year from the date of acquisition thereof by
such Person; (b) time deposits, certificates of deposit or bankers' acceptances
(including eurodollar deposits) issued by (i) any Lender or any Affiliate of a
Lender or (ii) any bank or trust company organized under the laws of the United
States of America or any state thereof (or the United States branch of any other
bank or trust company) and having capital, surplus and undivided profits of at
least $500,000,000; (c) commercial paper issued by a Lender or rated A-1 or
better by S&P or P-1
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or better by Xxxxx'x and maturing not more than 270 days from the date of
acquisition thereof by such Person; (d) repurchase obligations with a term of
not more than one year for underlying securities of the types described in
clause (a) above entered into with (i) a Lender or any Affiliate of a Lender,
(ii) a bank meeting the qualifications described in clause (b) above or (iii)
any other financial institution whose unsecured long-term debt (or the unsecured
long-term debt of whose direct or indirect parent) is rated A- or better by S&P
or A-3 or better by Xxxxx'x or whose commercial paper (or the commercial paper
of whose direct or indirect parent) is rated A-1 or better by S&P or P-1 or
better by Xxxxx'x; (e) securities with maturities of six months or less from the
date of acquisition issued or fully guaranteed by any state, commonwealth or
territory of the United States of America, or by any political subdivision or
taxing authority thereof, and rated at least A by S&P or A by Xxxxx'x or MIG-
1/1+ by S&P or Xxxxx'x; (f) money market or similar funds that invest primarily
in the foregoing items; and (g) with respect to any Person organized or
conducting operations outside of the United States, investments denominated in
the currency of the jurisdiction in which such Person is organized or conducting
business (so long as such jurisdiction is a member of the Organization for
Economic Cooperation and Development) which are similar to the items specified
in clauses (a) through (f) above (other than the nationality of the governmental
or non-governmental issuer or counterparty involved).
"Casualty Event" shall mean, with respect to any Property of any
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Person, any loss of title of such Property or any loss of or damage to or
destruction of, or any condemnation or other taking (including by any
Governmental Authority) of, such Property; provided, however, no such event
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shall constitute a Casualty Event if such proceeds or other compensation in
respect thereof is less than $5,000,000. "Casualty Event" shall include but not
be limited to any taking of all or any part of any Real Property of any Company,
in or by condemnation or other eminent domain proceedings pursuant to any Law,
or by reason of the temporary requisition of the use or occupancy of all or any
part of any Real Property of any Company by any Governmental Authority, civil or
military.
"CERCLA" see Section 8.10.
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"Change of Control" shall mean any transaction or event occurring on
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or after the date hereof as a direct or indirect result of which (a) any Person
or any group shall (A) beneficially own (directly or indirectly) in the
aggregate Equity Interests of Borrower having 35% or more of the aggregate
voting power of all Equity Interests of Borrower at the time outstanding or (B)
have the right or power to appoint a majority of the board of directors of
Borrower; or (b) during any period of two consecutive years, individuals who at
the beginning of such period constituted the board of directors of Borrower
(together with any new directors whose election by such board of directors or
whose nomination for election by the shareholders of Borrower was approved by a
vote of a majority of the directors of Borrower then still in office who were
either directors at the beginning of such period or whose election or nomination
for election was previously so approved) cease for any reason to constitute at
least a majority of the board of directors of Borrower then in office. For
purposes of this definition, the terms "beneficially own" and "group" shall have
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the respective meanings ascribed to them pursuant to Section 13(d) of the
Exchange Act, except that a Person or group shall be deemed to "beneficially
own" all securities that such Person or group has the right to acquire, whether
such right is exercisable immediately or only after the passage of time.
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"Class" see Section 1.03.
-----
"Closing Date" see Section 7.02.
------------
"Code" shall mean the United States Internal Revenue Code of 1986, as
----
amended.
"Collateral" shall mean all of the Pledged Collateral and any other
----------
property, whether now owned or hereafter acquired, upon which a Lien securing
the Obligations is granted or purported to be granted under any Security
Document.
"Collateral Account" see Section 8.2 of the Security Agreement.
------------------
"Commission" shall mean the United States Securities and Exchange
----------
Commission.
"Commitment Letter" shall mean the Credit Facilities Commitment Letter
-----------------
among Xxxxxxx Xxxxx Capital Corporation and Borrower dated August 1, 2001,
together with Exhibit A thereto.
"Commitments" shall mean the Revolving Commitments and the Term B
-----------
Facility Commitments.
"Companies" shall mean Borrower and the Subsidiaries and each BPC; and
---------
"Company" shall mean any one of them.
-------
"Consolidated Companies" shall mean Borrower and its Consolidated
----------------------
Subsidiaries.
"Consolidated EBITDA" shall mean, for any period, the sum (without
-------------------
duplication) of the amounts for such period of Adjusted Net Income, plus, in
each case to the extent deducted in calculating such Adjusted Net Income, (1)
provision for income taxes, (2) interest expense, (3) depreciation and
amortization expense, (4) other non-cash items of expense other than to the
extent requiring an accrual or reserve for future cash expenses that are payable
in cash prior to the Final Maturity Date and (5) to the extent such items of
expense are incurred in 2001, an amount of up to $28,000,000 in respect of
certain non-recurring expenses and charges described to the Lenders before the
Effective Date, all as determined on a consolidated basis for Consolidated
Companies; provided that if any material acquisition or disposition of a
--------
business or assets (other than sales, leases and rents in the ordinary course of
business of inventory and assets held for sale, lease or rent) is made during
such period, then Consolidated EBITDA for such period shall include or exclude,
as the case may be, the actual Consolidated EBITDA (without making any pro forma
---------
adjustments in respect of such acquisition or disposition) generated by the
business or assets that were the subject of such acquisition or disposition from
the first day of such period until the day such acquisition or disposition is
consummated.
"Consolidated Net Income" shall mean, for any period, the consolidated
-----------------------
net income (or loss) of Consolidated Companies for such period, determined in
conformity with GAAP.
-7-
"Consolidated Subsidiary" shall mean, for any Person, each Subsidiary
-----------------------
of such Person (whether now existing or hereafter created or acquired) the
financial statements of which shall be (or should be) consolidated with the
financial statements of such Person in accordance with GAAP.
"Contested Collateral Lien Conditions" shall mean, with respect to any
------------------------------------
Permitted Customary Liens of the type described in clause (a), (b), (c) or (d)
of the definition of Permitted Customary Liens or otherwise described in Section
9.03 hereof, that any proceeding instituted contesting such Lien shall
conclusively operate to stay the sale or forfeiture of any portion of the
Collateral on account of such Lien.
"Contingent Obligation" shall mean, as to any Person, any direct or
---------------------
indirect liability of such Person, whether or not contingent, with or without
recourse, (a) with respect to any Indebtedness, lease, dividend, letter of
credit or other obligation (the "primary obligations") of another Person (the
-------------------
"primary obligor"), including any obligation of such Person (i) to purchase,
----------------
repurchase or otherwise acquire such primary obligations or any security
therefor, (ii) to advance or provide funds for the payment or discharge of any
such primary obligation, or to maintain working capital or equity capital of the
primary obligor or otherwise to maintain the net worth or solvency or any
balance sheet item, level of income or financial condition of the primary
obligor, (iii) to purchase property, 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 any such primary obligation
against loss in respect thereof (each of (i)-(iv), a "Guaranty Obligation"); (b)
-------------------
with respect to any Surety Instrument (other than any Letter of Credit) issued
for the account of such Person or as to which such Person is otherwise liable
for reimbursement of drawings or payments; (c) to purchase any materials,
supplies or other property from, or to obtain the services of, another Person if
the relevant contract or other related document or obligation requires that
payment for such materials, supplies or other property, or for such services,
shall be made regardless of whether delivery of such materials, supplies or
other property is ever made or tendered, or such services are ever performed or
tendered; or (d) in respect of any Swap Contract; provided, however, that the
-------- -------
term Contingent Obligation shall not include endorsements of instruments for
deposit or collection or standard contractual indemnities entered into, in each
case in the ordinary course of business. The amount of any Contingent
Obligation shall (x) in the case of a Guaranty Obligation, be deemed equal to
the lesser of (i) the stated or determinable amount of the primary obligation in
respect of which such Guaranty Obligation is made or, if not stated or if
indeterminable, the maximum reasonably anticipated liability in respect thereof
and (ii) any express limit in the amount of such Contingent Obligation, and (y)
in the case of other Contingent Obligations, be equal to (i) the lesser of the
maximum reasonably anticipated liability in respect thereof and (ii) any express
limit in the amount of such Contingent Obligation.
"Continue," "Continuation" and "Continued" shall refer to the
-------- ------------ ---------
continuation pursuant to Section 2.09 of a LIBOR Loan from one Interest Period
to the next Interest Period.
"Contra Accounts Trigger Date" shall mean the date that Borrower shall
----------------------------
have completed the implementation of a system, reasonably satisfactory in all
respects to Administrative Agent, for reporting the amount of all Accounts
within the meaning of clause (i) of the definition of Eligible Receivables.
-8-
"Contractual Obligation" shall mean as to any Person, any provision of
----------------------
any security issued by such Person or of any mortgage, security agreement,
pledge agreement, indenture, credit agreement, securities purchase agreement,
debt instrument, contract, agreement, instrument or other undertaking to which
such Person is a party or by which it or any of its Property is bound or
subject.
"Convert," "Conversion" and "Converted" shall refer to a conversion
------- ---------- ---------
pursuant to Section 2.09 of one Type of Loans into another Type of Loans, which
may be accompanied by the transfer by a Lender (at its sole discretion) of a
Loan from one Applicable Lending Office to another.
"Covered Taxes" see Section 5.06(a).
-------------
"Credit Documents" shall mean this Agreement, the Notes, the L/C
----------------
Documents and the Security Documents, as amended from time to time.
"Credit Facilities" shall mean the Term B Facility and the Revolving
-----------------
Facility.
"Creditor" shall mean each of (i) each Agent, (ii) each L/C Lender,
--------
(iii) each Lender, and (iv) each party to a Swap Contract relating to the Loans
if at the date of entering into such Swap Contract such Person was a Lender or
an Affiliate of a Lender.
"Debt Issuance" shall mean the incurrence by any Company of any
-------------
Indebtedness after the Effective Date.
"Default" shall mean any event or condition that constitutes an Event
-------
of Default or that would become, with notice or lapse of time or both, an Event
of Default.
"Discretion" shall mean a determination made by Administrative Agent
----------
in good faith and in the exercise of reasonable (from the perspective of a
secured asset-based lender) business judgment consistent with its practices as
applied to similarly situated borrowers and based on the nature and quality of
the applicable components of the Borrowing Base; provided, however, that
-------- -------
Administrative Agent shall give reasonable prior notice to Borrower of its
intention to exercise Discretion, along with a brief description of the basis
for and nature of such exercise.
"Disposition" shall mean (i) any conveyance, sale, lease, assignment,
-----------
transfer or other disposition (including by way of merger or consolidation and
including any Sale and Leaseback Transaction) of any Property (including
Accounts of any Company and Equity Interests of any Person owned by any Company)
(whether owned on the Effective Date or thereafter acquired) by any Company to
any Person (other than to any Company), (ii) any issuance or sale by any
Subsidiary of its Equity Interests to any Person (other than any Company), and
(iii) any liquidating dividend or distribution received by any Company in
respect of any Minority Interest, excluding, however, in each case any Excluded
Disposition (except for purposes of defining the term "Excluded Disposition").
"Disposition Event" shall mean the receipt by any Company of cash
-----------------
proceeds or cash distributions of any kind in consideration for a Disposition.
-9-
"Disqualified Capital Stock" shall mean, with respect to any Person,
--------------------------
any Equity Interest of such Person that, by its terms (or by the terms of any
security into which it is convertible or for which it is exchangeable), or upon
the happening of any event, matures (excluding any maturity as the result of an
optional redemption by the issuer thereof) or is mandatorily redeemable (other
than solely for Qualified Capital Stock), pursuant to a sinking fund obligation
or otherwise, or is redeemable at the sole option of the holder thereof (other
than solely for Qualified Capital Stock) or exchangeable or convertible into
debt securities of the issuer thereof at the sole option of the holder thereof,
in whole or in part, on or prior to the date which is 90 days after the Final
Maturity Date; provided that an Equity Interest shall not be deemed to
--------
constitute Disqualified Capital Stock solely on account of the inclusion therein
of provisions requiring the mandatory redemption thereof, or the making of an
offer to redeem such Equity Interest, in each case in whole or in part, upon the
occurrence of a change of control or similar event or a sale, lease or other
disposition of assets, so long as such provision is expressly subject to the
prior payment of the Obligations.
"Distribution Agreement" shall mean the Distribution Agreement dated
----------------------
as of [ ], 2001 between Borrower and Pitney Xxxxx Inc.
"Dividend Payment" shall mean dividends (in cash, Property or
----------------
obligations) on, or other payments or distributions on account of, or the
setting apart of money for a sinking or other analogous fund for, or the
purchase, redemption, retirement or other acquisition of, any Equity Interests
or Equity Rights of any Company, but excluding dividends paid through the
issuance of additional shares of Qualified Capital Stock and any redemption or
exchange of any Qualified Capital Stock of a Company through the issuance of
Qualified Capital Stock of such Company.
"Documentation Agent" see the introduction hereto.
-------------------
"Dollar Equivalent" means, at any time, (a) as to any amount
-----------------
denominated in Dollars, the amount thereof at such time, and (b) as to any
amount denominated in any Offshore Currency, the equivalent amount in Dollars as
determined by Administrative Agent at such time on the basis of the Spot Rate
for the purchase of Dollars with such Offshore Currency and after giving effect
to any currency hedging arrangements to the extent such arrangements apply to
such amount.
"Dollars" and "$" shall mean lawful money of the United States of
------- -
America.
"Domestic Subsidiary" shall mean any Subsidiary other than a Foreign
-------------------
Subsidiary.
"Effective Date" see Section 7.01.
--------------
"Eligible Accrued Billings" shall mean those Accrued Billings created
-------------------------
by the Obligors in the ordinary course of their business, that arise out of
their sale, lease or rent of goods or rendition of services and that are not
excluded as ineligible by virtue of one or more of the criteria set forth below;
provided, however, that such criteria may be fixed and revised from time to time
-------- -------
by Administrative Agent in Administrative Agent's Discretion, including to
address the results of any audit performed by Administrative Agent from time to
time after the Closing Date. In determining the amount to be included, Eligible
Accrued Billings shall be calculated net of deposits in respect of Xxx-
-10-
gible Accrued Billings. Eligible Accrued Billings shall not include Accrued
Billings that do not (or would not) constitute Eligible Receivables, unless such
Accrued Billings are excluded from the definition of Eligible Receivables solely
by virtue of the fact that the subject Account is shown on the books and records
of the applicable Obligor and no xxxx, invoice or other request for payment has
been issued to the Account Debtor.
"Eligible Assignee" shall mean (a) a Lender; (b) an Affiliate of a
-----------------
Lender; (c) an Approved Fund; and (d) any other Person (other than a natural
Person) approved by Administrative Agent and, in the case of any assignment of a
Revolving Commitment, any L/C Lender, and, unless (x) such Person is taking
delivery of an assignment in connection with physical settlement of a credit
derivatives transaction or (y) a Default or an Event of Default has occurred and
is continuing, Borrower (each such approval not to be unreasonably withheld or
delayed). If the consent of Borrower to an assignment which does not meet the
minimum assignment thresholds specified in paragraph (b)(i) of Section 12.05 is
not received, Borrower shall be deemed to have given its consent five Business
Days after the date notice thereof has been delivered by the assigning Lender
(through Administrative Agent) unless such consent is expressly refused by
Borrower prior to such fifth Business Day.
"Eligible BPC Accrued Billings" shall mean Eligible Accrued Billings
-----------------------------
of the BPCs.
"Eligible BPC Inventory" shall mean Eligible Inventory of the BPCs.
----------------------
"Eligible BPC Receivables" shall mean Eligible Receivables of the
------------------------
BPCs; provided however, that Eligible BPC Receivables shall not include Accounts
-------- -------
that the Account Debtor has failed to pay within 90 days of the original invoice
date.
"Eligible BPC Rental Assets" shall mean Eligible Rental Assets of the
--------------------------
BPCs.
"Eligible Inventory" shall mean Inventory of the Obligors (other than
------------------
Rental Assets) consisting of new, used, refurbished and remanufactured goods,
supplies for customers and service parts for customers (which, in the case of
new goods, supplies and parts shall be first quality finished goods, supplies
and parts), in each case held for sale, lease or rent in the ordinary course of
the Obligors' business that is not excluded as ineligible by virtue of one or
more of the criteria set forth below; provided, however, that such criteria may
-------- -------
be fixed and revised from time to time by Administrative Agent in Administrative
Agent's Discretion, including to address the results of any audit or appraisal
performed by Administrative Agent from time to time after the Closing Date. The
value of Eligible Inventory shall be calculated on the basis of the lower of
cost or market with the cost of raw materials and finished goods calculated in
accordance with the "first-in, first-out" method of accounting for inventory and
in accordance with GAAP. An item of Inventory shall not be included in Eligible
Inventory if:
(a) it is at a location other than (i) a location set forth on Annex
-----
B (as such Annex may be amended or supplemented from time to time by
-
Borrower, such amendment or supplement to be effective upon receipt thereof
by Administrative Agent) or (ii) in transit between any locations referred
to in the immediately preceding clause (i), to the extent the Inventory
located at such location, when taken together with the Inventory located at
all other
-11-
locations not referred to in clauses (i) or (ii) of this clause (a),
contains more than 10.0% of the aggregate Inventory,
(b) the applicable Obligor does not have good, valid and marketable
title thereto,
(c) it is located on real property leased by one of the Obligors or
in a contract warehouse, unless (i) Borrower has elected to establish a
Reserve equal to 3 months' rent in respect of Inventory located at such
location or (ii) it is subject to a Landlord Consent executed by the
lessor, warehouseman or other third party, as the case may be, and unless
it is segregated or otherwise separately identifiable from goods of others,
if any, stored on the premises,
(d) it is subject to any Lien (other than a Lien permitted by the
Credit Documents) or it is not subject to a valid and perfected first
priority security Lien in favor of the Creditors securing the Obligations,
(e) it consists of goods that are obsolete or slow moving, xxxx and
hold goods, defective goods, "seconds" or Inventory acquired on
consignment,
(f) it is subject to a negotiable document of title not in the
possession of an Obligor or Administrative Agent,
(g) it is not either (i) located in the United States or (ii) loaded
freight charges and insurance premiums paid, upon a vessel bound for a port
in the United States or
(h) it is goods acquired by one of the Obligors in or as part of a
"bulk" transfer or sale of assets and such acquisition is not consummated
in the ordinary course of business unless Borrower (i) has complied with
all applicable bulk sales or bulk transfer laws in connection with such
acquisition or (ii) has received adequate assurances from the seller of
such goods that the Companies will be made whole for all losses resulting
from a violation of the bulk sales or bulk transfer laws.
"Eligible Receivables" shall mean (without duplication) those Accounts
--------------------
of the Obligors, that arise out of the sale, lease or rent of goods or the
rendition of services in the ordinary course of business and that are not
excluded as ineligible by virtue of one or more of the criteria set forth below;
provided, however, that such criteria may be fixed and revised from time to time
-------- -------
by Administrative Agent in Administrative Agent's Discretion, including to
address the results of any audit performed by Administrative Agent from time to
time after the Closing Date. In determining the amount to be included, Eligible
Receivables shall be calculated (to the extent not already reflected on the
books and records of the applicable Obligor) net of customer deposits and
unapplied cash remitted to the Obligors, and less any and all returns, rebates,
discounts (which may, at the option of Administrative Agent, be calculated on
shortest terms), credits, allowances or excise taxes of any nature at any time
issued, claimed by Account Debtors, granted or payable in connection with such
Accounts at such time. Eligible Receivables shall not include the following:
-12-
(a) Accounts that the Account Debtor has failed to pay within 120
days of original invoice date,
(b) Accounts that are owed by an Account Debtor where more than 50%
of all Accounts owed by such Account Debtor are determined ineligible under
clause (a) above; provided, however, that until Borrower shall have
-------- -------
implemented a system, reasonably satisfactory in all respects to
Administrative Agent, for reporting such Accounts, the amount of Eligible
Accounts shall be reduced by an amount equal to 15% of the Accounts that
are deemed ineligible under clause (a) above instead of excluding Accounts
referred to in this clause (b),
(c) Accounts that the Account Debtor has failed to pay for more than
90 days but less than 120 days after the original invoice date, to the
extent that the aggregate amount of such Accounts exceeds $4,000,000,
(d) Accounts with respect to which the Account Debtor is an employee
or Affiliate of any Company,
(e) Accounts arising in a transaction wherein goods are placed on
consignment or are sold pursuant to a guaranteed sale, a sale or return, a
sale on approval, a xxxx and hold or any other terms by reason of which the
payment by the Account Debtor may be conditional,
(f) Accounts that are not payable in Dollars,
(g) Accounts with respect to which the Account Debtor either (i) does
not maintain its chief executive office in the United States; provided,
--------
that if the applicable Account Debtor is a United States division or
subsidiary of a non-United States Person, and such division or subsidiary
is located in any state of the United States, the District of Columbia or
Puerto Rico, the corresponding Account shall not be excluded, or (ii) is
not organized under the laws of the United States, any state thereof, the
District of Columbia or Puerto Rico; provided, however, that if the
-------- -------
applicable Account Debtor is a United States division or subsidiary of a
non-United States Person, and such division or subsidiary is located in any
state of the United States, the District of Columbia or Puerto Rico, the
corresponding Account shall not be excluded, or (iii) is the government of
any foreign country or sovereign state, or of any state, province,
municipality or other political subdivision thereof, or of any department,
agency, public corporation or other instrumentality thereof, unless (x) the
Account is due from Pitney Xxxxx of Canada Ltd., (y) the Account is
supported by an irrevocable letter of credit satisfactory to Administrative
Agent (as to form, substance and issuer or domestic confirming bank) that
has been delivered to Administrative Agent and is directly drawable by
Administrative Agent or (z) the Account is covered by credit insurance in
form, substance and amount, and by an insurer, satisfactory to
Administrative Agent,
(h) Until the Federal Accounts Trigger Date, 1% of all Accounts, and
thereafter, Accounts with respect to which the Account Debtor is the United
States or any department, agency or instrumentality of the United States
(exclusive, however, of Accounts with respect
-13-
to which the applicable Obligor has complied, to the reasonable
satisfaction of Administrative Agent, with the Assignment of Claims Act, 31
U.S.C. (S) 3727),
(i) After the Contra Accounts Trigger Date, Accounts with respect to
which the Account Debtor is a supplier or creditor of any Company (unless
such Person has waived setoff in a manner acceptable to Administrative
Agent), has or has asserted a right of setoff, has disputed its liability,
or has made any claim with respect to its obligation to pay the Account, to
the extent of such claim, right of setoff or dispute,
(j) Accounts with respect to an Account Debtor whose total
obligations owing to Borrower exceed 15% (or, in the case of an Account
Debtor whose long-term debt is rated Investment Grade, 20%) of all Eligible
Receivables, to the extent of the obligations owing by such Account Debtor
in excess of such percentage,
(k) Accounts with respect to which the Account Debtor is known to an
executive or financial officer of Borrower to be subject to an Insolvency
Proceeding or to have gone out of business, or as to which any such
executive or financial officer has received notice of an imminent
Insolvency Proceeding with respect to such Account Debtor or has reason to
believe that such Account Debtor is not able to pay its debts as they
become due,
(l) Accounts with respect to which the Account Debtor is located in
the states of New Jersey, Minnesota or West Virginia (or any other state
that requires a creditor to file a business activity report or similar
document in order to bring suit or otherwise enforce its remedies against
such Account Debtor in the courts or through any judicial process of such
state), unless the applicable Obligor has qualified to do business in New
Jersey, Minnesota, West Virginia or such other states, or has filed a
business activities report with the applicable division of taxation, the
department of revenue or with such other state offices, as appropriate, for
the then-current year, or is exempt from such filing requirement,
(m) Accounts that are not subject to a valid and perfected first
priority Lien in favor of the Creditors securing the Obligations,
(n) Accounts representing any manufacturer's or supplier's credits,
discounts, incentive plans or similar arrangements entitling any Company to
discounts on future purchases therefrom,
(o) Accounts which do not constitute an "account," "instrument" or
"chattel paper" within the meaning of the Uniform Commercial Code of the
state in which the Account is located, and
(p) Accounts which are required to be or have been written off as
uncollectible in accordance with GAAP.
"Eligible Rental Assets" shall mean (without duplication) all Rental
----------------------
Assets of any Obligor held for sale, rent or lease or rented or leased by any
Obligor as lessor in the ordinary course
-14-
of business and not deemed by Administrative Agent (after at least two Business
Days' prior notice to Borrower by Administrative Agent) in Administrative
Agent's Discretion to be ineligible for inclusion in the calculation of
Borrowing Base in accordance with clauses (a) through (c) below. In determining
the amount to be so included, such Rental Assets shall be valued on a net book
value basis consistent with Borrower's consolidated month-end balance sheet.
Unless otherwise approved in writing by Administrative Agent, no Rental Assets
shall be deemed Eligible Rental Assets if:
(a) the Rental Assets are not owned (including owned subject to a
lease) solely by such Obligor and with respect to which such Obligor does
not have good, valid and marketable title, or is held by a third-party for
sale on a xxxx-and-hold, guaranteed sale, sale-and-return, sale on approval
or consignment basis;
(b) the Rental Assets are not subject to a perfected first priority
Lien in favor of Administrative Agent except to the extent subject only to
Permitted Liens, provided that the value of any Rental Assets shall be
--------
reduced by the amount of any obligations secured by Permitted Liens which
are prior to the Lien in favor of Administrative Agent; or
(c) the Rental Assets are not located in any state of the United
States, the District of Columbia or Puerto Rico unless arrangements for the
granting and perfection of a security interest in such Rental Assets have
been made in a manner acceptable to Administrative Agent in its discretion.
"Employee Benefit Plan" shall mean an employee benefit plan (as
---------------------
defined in Section 3(3) of ERISA) that is maintained or contributed to by any
ERISA Entity or with respect to which Borrower or a Subsidiary could incur
liability.
"Environmental Claim" shall mean, with respect to any Person, any
-------------------
written notice, claim, demand or other communication (collectively, a "claim")
-----
by any other Person alleging such Person's liability for any costs, cleanup
costs, response or corrective action costs, damages to natural resources or
other Property, personal injuries, fines or penalties arising out of or
resulting from (i) the presence, Release or threatened Release into the
environment, of any Hazardous Material at any location, whether or not owned by
such Person, or (ii) any violation of any Environmental Law. The term
"Environmental Claim" shall include any claim by any Person seeking damages,
contribution, indemnification, cost recovery, compensation or injunctive relief
resulting from the presence of Hazardous Materials or arising from alleged
injury or threat of injury to health, safety or the environment.
"Environmental Laws" shall mean any and all present and future
------------------
applicable laws, rules or regulations of any Governmental Authority, any orders,
decrees, judgments or injunctions and the common law in each case as now or
hereafter in effect, relating to pollution or protection of human health, safety
or the environment, including without limitation, ambient air, indoor air, soil,
or surface water, ground water, land or subsurface strata, and natural resources
such as wetlands, flora or fauna, including, without limitation, those relating
to Releases or threatened Releases of Hazardous Materials into the environment,
or otherwise relating to the manufacture, processing, generation, distribution,
use, treatment, storage, discharge, disposal, collection, transfer, transport or
handling of Hazardous Materials.
-15-
"Equity Interests" shall mean, with respect to any Person, any and all
----------------
shares, interests, participations or other equivalents, including membership
interests (however designated, whether voting or non-voting), of capital of such
Person, including, if such Person is a partnership, partnership interests
(whether general or limited) and any other interest or participation that
confers on a Person the right to receive a share of the profits and losses of,
or distributions of assets of, such partnership, whether outstanding on the date
hereof or issued after the Effective Date.
"Equity Proceeds" shall mean, as of any date of determination, the
---------------
aggregate amount of the net proceeds received by Borrower from the sale or sales
of, or capital contributions with respect to, its Equity Interests or Equity
Rights, after deduction of costs, discounts and commissions incurred in
connection with such sale or sales, to such date of determination.
"Equity Rights" shall mean, with respect to any Person, any
-------------
outstanding subscriptions, options, warrants, commitments, preemptive rights or
agreements of any kind (including any stockholders' or voting trust agreements)
for the issuance, sale, registration or voting of, or outstanding securities
convertible into, any additional shares of Equity Interests of any class, or
partnership or other ownership interests of any type in, such Person.
"ERISA" shall mean the United States Employee Retirement Income
-----
Security Act of 1974, as amended.
"ERISA Entity" shall mean any member of an ERISA Group.
------------
"ERISA Event" shall mean (a) any "reportable event," as defined in
-----------
Section 4043 of ERISA or the regulations issued thereunder with respect to a
Pension Plan (other than an event for which the 30-day notice period is waived);
(b) the existence with respect to any Pension Plan of an "accumulated funding
deficiency" (as defined in Section 412 of the Code or Section 302 of ERISA),
whether or not waived, the failure to make by its due date a required
installment under Section 412(m) of the Code with respect to any Pension Plan or
the failure to make any required contribution to a Multiemployer Plan; (c) the
filing pursuant to Section 412(d) of the Code or Section 303(d) of ERISA of an
application for a waiver of the minimum funding standard with respect to any
Pension Plan; (d) the incurrence by any ERISA Entity of any liability under
Title IV of ERISA with respect to the termination of any Pension Plan under
Section 4041(c) or 4042 of ERISA; (e) the receipt by any ERISA Entity from the
PBGC or a plan administrator of any notice relating to an intention to terminate
any Pension Plan under Section 4041(c) or 4042 of ERISA or to appoint a trustee
to administer any Pension Plan, or the occurrence of any event or condition
which could reasonably constitute grounds under ERISA for such termination of or
the appointment of a trustee to administer, any Pension Plan; (f) the incurrence
by any ERISA Entity of any liability with respect to the withdrawal or partial
withdrawal from any Pension Plan or Multiemployer Plan; (g) the receipt by an
ERISA Entity of any notice, or the receipt by any Multiemployer Plan from any
ERISA Entity of any notice, concerning the imposition of Withdrawal Liability or
a determination that a Multiemployer Plan is, or is expected to be, insolvent or
in reorganization, within the meaning of Title IV of ERISA; (h) the making of
any amendment to any Pension Plan which could result in the imposition of a lien
or the posting of a bond or other security; or (i) the occurrence of a nonexempt
prohibited transaction (within the
-16-
meaning of Section 4975 of the Code or Section 406 of ERISA) which could result
in any material liability to any Company.
"ERISA Group" shall mean any Company and all members of a controlled
-----------
group of corporations and all trades or businesses (whether or not incorporated)
under common control which, together with such Company, are treated as a single
employer under Section 414(b), (c), (m) or (o) of the Code.
"Event of Default" see Section 10.
----------------
"Exchange Act" shall mean the United States Securities Exchange Act of
------------
1934, as amended, and the rules and regulations of the Commission promulgated
thereunder.
"Excluded Dispositions" shall mean (i) Dispositions for fair market
---------------------
value resulting in no more than $5,000,000 in aggregate proceeds in any fiscal
year (not including in the computation of such limit any Dispositions referred
to in clause (vi) of this definition); (ii) an exchange of equipment or
inventory for other equipment or inventory, provided that the Company effecting
--------
such exchange receives at least substantially equivalent value in such exchange
for the Property disposed of; (iii) the attachment or granting of any Permitted
Lien, the making of any Investment permitted by Section 9.09 and the making of
any Dividend Payment permitted by Section 9.10; (iv) the sale or lease of
inventory or Rental Assets in the ordinary course of business; (v) the sale of
used or worn out equipment in the ordinary course of business consistent with
past practice; and (vi) any Disposition for fair market value that, together
with all related Dispositions effected as part of a common plan, results in
aggregate proceeds of less than $100,000.
"Excluded Subsidiary" shall mean each Subsidiary existing on the
-------------------
Effective Date identified on Schedule 1.01(e) as an Excluded Subsidiary, or any
----------------
Subsidiary acquired or formed after the Effective Date, in each case unless and
until either (a) such Subsidiary has consolidated assets in excess of $1,000,000
or (b) such Subsidiary's consolidated revenues for any fiscal year of Borrower
(determined on a pro forma basis in the case of any such Subsidiary acquired or
--- -----
formed after the Effective Date) exceed 1.0% of Borrower's consolidated revenues
for such fiscal year (and thereafter, and for so long as either of the
conditions in clause (a) or (b) of this sentence remains true, such Subsidiary
shall be deemed not an "Excluded Subsidiary").
"Excluded Taxes" see Section 5.06(a).
--------------
"Existing Affiliate Agreements" see Section 9.15.
-----------------------------
"fair market value" shall mean, with respect to any Property, a price
-----------------
(after taking into account any liabilities relating to such Property), as
determined by Borrower in good faith, that is within a reasonable range of
prices which could be negotiated in an arm's-length free market transaction, for
cash, between a willing seller and a willing and able buyer, neither of which is
under any compulsion to complete the transaction.
-17-
"Federal Accounts Trigger Date" shall mean the date that Borrower
-----------------------------
shall have completed the implementation of a system, reasonably satisfactory in
all respects to Administrative Agent, for reporting the amount of all Accounts
within the meaning of clause (h) of the definition of Eligible Receivables.
"Federal Funds Rate" shall mean, for any day, the rate per annum
------------------ --- -----
(rounded upwards, if necessary, to the nearest 1/100 of 1%) equal to the
weighted average of the rates on overnight Federal funds transactions with
members of the Federal Reserve System arranged by Federal funds brokers on such
day, as published by the Federal Reserve Bank of New York on the Business Day
next succeeding such day; provided, however, that (a) if the day for which such
-------- -------
rate is to be determined is not a Business Day, the Federal Funds Rate for such
day shall be such rate on such transactions on the next preceding Business Day
as so published on the next succeeding Business Day and (b) if such rate is not
so published for any Business Day, the Federal Funds Rate for such Business Day
shall be the average rate quoted to Bank on such Business Day on such
transactions by three federal funds brokers of recognized standing, as
determined by Administrative Agent.
"Fee Letter" shall mean the Credit Facilities Fee Letter dated as of
----------
August 1, 2001 between Xxxxxxx Xxxxx Capital Corporation and Borrower.
"Final Maturity Date" shall mean the sixth anniversary of the
-------------------
Effective Date.
"Financial Maintenance Covenants" shall mean the covenants set forth
-------------------------------
in Sections 9.11(a) and (b).
"Foreign Lender Certificate" see Section 5.06.
--------------------------
"Foreign Plan" shall mean any employee benefit plan, program, policy,
------------
arrangement or agreement (other than a Pension Plan or any other employee
benefit plan subject to ERISA) maintained or contributed to by, or entered into
with, any Company with respect to employees employed outside the United States.
"Foreign Subsidiary" shall mean any direct or indirect Subsidiary
------------------
organized outside of the United States as defined in Section 7701(a)(9) of the
Code (or any successor provision).
"Fund" shall mean any Person (other than a natural Person) that is (or
----
will be) engaged in making, purchasing, holding or otherwise investing in
commercial loans and similar extensions of credit in the ordinary course of its
business.
"Funding Date" shall mean the date of the making of any extension of
------------
credit hereunder (including the Closing Date).
"GAAP" shall mean, as of any date of determination, generally accepted
----
accounting principles set forth as of such date in the opinions and
pronouncements of the Accounting Principles Board of the American Institute of
Certified Public Accountants and statements and pronouncements of the Financial
Accounting Standards Board (or agencies with similar functions of comparable
stat-
-18-
ure and authority within the U.S. accounting profession), which are applicable
to the circumstances as of such date.
"Governmental Authority" shall mean any government or political
----------------------
subdivision of the United States or any other country or any agency, authority,
board, bureau, central bank, commission, department or instrumentality thereof
or therein, including, without limitation, any court, tribunal, grand jury or
arbitrator or any entity exercising executive, legislative, judicial, regulatory
or administrative functions of or pertaining to such government or political
subdivision.
"Guarantee" shall mean the guarantee of each Guarantor pursuant to
---------
Section 6.
"Guaranteed Obligations" see Section 6.01.
----------------------
"Guarantors" shall mean each Subsidiary listed on Schedule 1.01(d) and
---------- ----------------
each Subsidiary that after the Effective Date guarantees the payment of the
Obligations pursuant to Section 9.20.
"Guaranty Obligation" see the definition of Contingent Obligation.
-------------------
"Hazardous Material" shall mean any pollutant, contaminant, toxic,
------------------
hazardous or extremely hazardous substance, constituent or waste, or any other
constituent, waste, material, compound or substance subject to regulation under
any Environmental Law including, without limitation, petroleum or any petroleum
product, including crude oil or any fraction thereof, polychlorinated biphenyls,
urea-formaldehyde insulation and asbestos.
"in the ordinary course of business" shall mean in the ordinary course
----------------------------------
of business of the Companies.
"incur" shall mean, with respect to any Indebtedness or other
-----
obligation of any Person, to create, issue, incur (including by conversion,
exchange or otherwise), assume, guarantee or otherwise become liable in respect
of such Indebtedness or other obligation or to grant or create a Lien upon any
Property of such Person to secure any Indebtedness of another Person (and
"incurrence," "incurred" and "incurring" shall have meanings correlative to the
----------- -------- ---------
foregoing).
"Indebtedness" shall mean, for any Person, without duplication, (a)
------------
all indebtedness for borrowed money of such Person; (b) all obligations of such
Person for the deferred purchase price of Property or services (other than trade
payables and accrued expenses arising in the ordinary course of business); (c)
all obligations of such Person to reimburse or prepay any other Person in
respect of amounts paid under letters of credit (including Letters of Credit),
banker's acceptances or similar instruments, whether drawn or undrawn; (d) all
obligations of such Person evidenced by notes, bonds (other than bid or
performance bonds), debentures or similar instruments; (e) all indebtedness 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), but
excluding operating leases; (f) all Capital Lease Obligations of such Person;
(g) all indebtedness of
-19-
other Persons referred to in clauses (a) through (f) above secured by (or for
which the holder of such indebtedness has an existing right, contingent or
otherwise, to be secured by) any Lien upon or in Property (including accounts
and contracts rights) owned by such Person, whether or not such Person has
assumed or become liable for the payment of such indebtedness (provided that
--------
the amount of indebtedness shall be deemed to be limited to the fair market
value of such Property if such Person has not assumed or become liable for the
payment of such indebtedness); (h) all obligations of such Person under
synthetic leases; (i) all obligations of such Person under Swap Contracts; and
(j) all Guaranty Obligations of such Person in respect of indebtedness or
obligations of any other Person of the kinds referred to in clauses (a) through
(j) above. Indebtedness shall not include accounts extended by suppliers in the
ordinary course of business in connection with the purchase of goods and
services. The Indebtedness of any Person shall include the Indebtedness of any
other entity (including any partnership in which such Person is a general
partner) to the extent such Person is liable therefor as a result of such
Person's ownership interest in or other relationship with such entity, except to
the extent the terms of such Indebtedness (i) provide that such Person is not
liable therefor or (ii) limit the liability of such Person for such
Indebtedness.
"Indemnitee" see Section 12.03(b).
----------
"Insolvency Proceeding" shall mean any proceeding commenced by or
---------------------
against any Person under any provision of the Bankruptcy Code or under any other
state or federal bankruptcy or insolvency law, assignments for the benefit of
creditors, compositions or proceedings seeking reorganization, arrangement or
other similar relief.
"Intellectual Property" see Section 8.21.
---------------------
"Interest Period" shall mean, with respect to any LIBOR Loan, each
---------------
period commencing on the date such LIBOR Loan is made or Converted from an ABR
Loan or the last day of the next preceding Interest Period for such LIBOR Loan
and (subject to the requirements of Section 2.09) ending on the numerically
corresponding day in the first, second, third, sixth or, to the extent available
to the relevant Lenders, ninth or twelfth calendar month thereafter, as Borrower
may select as provided in Section 4.05, except that each Interest Period that
commences on the last Business Day of a calendar month (or on any day for which
there is no numerically corresponding day in the appropriate subsequent calendar
month) shall end on the last Business Day of the appropriate subsequent calendar
month. Notwithstanding the foregoing: (i) if any Interest Period for any
Revolving Loan would otherwise end after the R/C Termination Date, such Interest
Period shall end on the R/C Termination Date; (ii) no Interest Period for any
Term B Facility Loan may commence before and end after any Principal Payment
Date, unless, after giving effect thereto, the aggregate principal amount of the
Term B Facility Loans having Interest Periods that end after such Principal
Payment Date shall be equal to or less than the aggregate principal amount of
the Term B Facility Loans scheduled to be outstanding after giving effect to the
payments of principal required to be made on such Principal Payment Date; (iii)
each Interest Period that would otherwise end on a day that is not a Business
Day shall end on the next succeeding Business Day (or, if such next succeeding
Business Day falls in the next succeeding calendar month, on the next preceding
Business Day); and (iv) notwithstanding clauses (i) and (ii) above, unless
consented to by the Lead Arranger and Administrative Agent, no Interest Period
shall have a duration of less than one month and, if the Interest Period for any
LIBOR
-20-
Loan would otherwise be a shorter period, such Loan shall not be available
hereunder as a LIBOR Loan for such period; provided, that the first Interest
--------
Period with respect to Term B Facility Loans that commences after the primary
syndication of the Term B Facility is completed will end on the last Business
Day of the month during which, absent this proviso, such Interest Period would
otherwise end.
"Interest Rate Certificate" shall mean an Officers' Certificate
-------------------------
substantially in the form of Exhibit C-1, delivered pursuant to Section 9.01(e),
-----------
demonstrating in reasonable detail the calculation of the Total Leverage Ratio
as of any Test Date.
"Interest Rate Protection Agreement" shall mean, for any Person, an
----------------------------------
interest rate swap, cap or collar agreement or similar arrangement between such
Person and one or more financial institutions providing for the transfer or
mitigation of interest risks either generally or under specific contingencies.
"Inventory" shall mean, collectively, with respect to each Company,
---------
all "inventory," as such term is defined in the UCC, of such Company wherever
located and of every class, kind and description and, in any event, shall
include, without limitation, (i) all goods (including goods held for sale or
lease or to be furnished under a contract of service, goods that are leased by
such Company as lessor and goods that are furnished by such Company under a
contract of service), merchandise, raw materials, work-in-process, returned
goods, finished goods, samples and consigned goods (to the extent of the
consignee's interest therein), materials and supplies of any kind or nature
which are or might be used in connection with the manufacture, printing,
publication, packing, shipping, advertising, selling or finishing of any such
goods and all other products, goods, materials and supplies, (ii) all inventory
as is temporarily out of such Company's custody or possession, items in transit
and any returns and repossessions upon any Accounts and (iii) all substitutions
therefor or replacements thereof, and all additions and accessions thereto.
"Investment" shall mean, for any Person: (a) the acquisition (whether
----------
for cash, Property, services, securities or otherwise) of Equity Interests,
Equity Rights, bonds, notes, debentures or other securities of any other Person;
(b) the making of any deposit with, or advance, loan or other extension of
credit to, any other Person (including the purchase of Property from another
Person subject to an understanding or agreement, contingent or otherwise, to
resell such Property to such Person); (c) any capital contribution to (by means
of any transfer of cash or other Property to others or any payment for Property
or services for the account or use of others) any other Person; and (d) the
entering into, or direct or indirect incurrence, of any Guaranty Obligation with
respect to Indebtedness or other liability of any other Person. In determining
the aggregate amount of Investments outstanding at any particular time: (a) the
amount of any Investment represented by a Guaranty Obligation shall be equal to
the lesser of (i) the principal amount of the Indebtedness or other obligation
guaranteed thereby that is still outstanding and (ii) the amount, if any, to
which such Guaranty Obligation is expressly limited; (b) there shall be deducted
in respect of each such Investment any amount received as a dividend on, or a
repurchase, redemption, retirement or repayment of, such Investment and (c) the
amount of any Investment shall not be increased or decreased on account of any
change in the value thereof.
-21-
"Investment Grade" shall mean a credit rating of at least Baa3 (or the
----------------
equivalent) by Xxxxx'x, together with a rating of at least BBB- (or the
equivalent) by S&P.
"Joinder Agreement" shall mean a Joinder Agreement substantially in
-----------------
the form of Exhibit I.
---------
"Landlord Consents" shall mean a landlord lien waiver and access
-----------------
agreement, substantially in the form of Exhibit K-1 hereto, bailee letter,
-----------
substantially in the form of Exhibit K-2 hereto, or acknowledgment agreement of
-----------
any lessor, warehouseman, processor, consignee or other Person in possession of,
having a Lien upon or having rights or interests in the Inventory, in each case,
in form and substance satisfactory to Administrative Agent.
"Laws" shall mean, collectively, all common law and all international,
----
foreign, federal, state and local statutes, treaties, rules, guidelines,
regulations, ordinances, codes and administrative or judicial precedents,
including without limitation the interpretation thereof by any Governmental
Authority charged with the enforcement thereof.
"L/C Documents" shall mean, with respect to any Letter of Credit,
-------------
collectively, any other agreements, instruments, guarantees or other documents
(whether general in application or applicable only to such Letter of Credit)
governing or providing for (a) the rights and obligations of the parties
concerned or at risk with respect to such Letter of Credit or (b) any collateral
security for any of such obligations, each as the same may be modified and
supplemented and in effect from time to time.
"L/C Interest" shall mean, for each Revolving Lender, such Lender's
------------
participation interest (or, in the case of any L/C Lender, such L/C Lender's
retained interest) in the L/C Lenders' liabilities under Letters of Credit and
such Lender's rights and interests in Reimbursement Obligations and fees,
interest and other amounts payable in connection with Letters of Credit and
Reimbursement Obligations.
"L/C Lender" shall mean Administrative Agent, Bank or the respective
----------
Affiliates of either, and any other Lender or Lenders, or Affiliates of any
Lender or Lenders, selected by Borrower that shall have agreed in writing to be
an L/C Lender hereunder, as the issuer of Letters of Credit under Section 2.03,
together, in each case, with its successors and assigns in such capacity.
"L/C Liability" shall mean, without duplication, at any time and in
-------------
respect of any Letter of Credit, the sum of (a) the undrawn available amount of
such Letter of Credit, plus (b) the aggregate unpaid principal amount of all
Reimbursement Obligations at such time due and payable in respect of all
drawings made under such Letter of Credit.
"Lead Arranger" see the introduction hereto.
-------------
"Lender" and "Lenders" see the introduction hereto.
------ -------
"Letter of Credit" see Section 2.03.
----------------
-22-
"LIBO Rate" shall mean, for any LIBOR Loan for any Interest Period
---------
therefor, a rate per annum (rounded upwards, if necessary, to the nearest 1/100
---------
of 1%) determined by Bank for Administrative Agent to be equal to the LIBOR Base
Rate for such Loan for such Interest Period divided by 1 minus the Reserve
-----
Requirement (if any) for such Loan for such Interest Period.
"LIBOR Base Rate" shall mean, as applicable to any LIBOR loan for any
---------------
Interest Period therefor, the rate per annum (rounded upward, if necessary, to
the nearest 1/32 of 1%) as determined by Bank for Administrative Agent on the
basis of the offered rates for deposits in Dollars, for a term comparable to
such Interest Period which appears on the Telerate page 3750 as of 11:00 a.m.
(London time) on the day that is two (2) Business Days preceding the first day
of such Interest Period, provided, however, that if the rate described above
-------- -------
does not appear on the Telerate System on any applicable interest determination
date, the LIBOR Base Rate shall be the rate (rounded upward as described above,
if necessary) for deposits in Dollars for a period substantially equal to the
interest on the Reuters Page "LIBO" (or such other page as may replace the LIBO
Page on that service for the purpose of displaying such rates), as of 11:00 a.m.
(London Time), on the day that is two (2) Business Days prior to the beginning
of such Interest Period. If both the Telerate and Reuters systems are
unavailable, then the rate for that date will be determined on the basis of the
offered rates for deposits in Dollars for a time comparable to such Interest
Period which are offered by four major banks in the London interbank market at
approximately 11:00 a.m. (London time), on the day that is two (2) Business Days
preceding the first day of such Interest Period as selected by Bank for
Administrative Agent. The principal office of each of the major London banks so
selected will be requested to provide a quotation of its Dollar deposit offered
rate. If at least two (2) such quotations are provided, the rate for that date
will be the arithmetic mean of the quotations. If fewer than two quotations are
provided as requested, the rate for that date will be determined on the basis of
the rates quoted for loans in Dollars to leading European banks for a period of
time comparable to such Interest Period offered by major banks in New York City
at approximately 11:00 a.m. (New York City time), on the day that is two (2)
Business Days preceding the first day of such Interest Period. In the event
that Bank is unable to obtain any such quotation for Administrative Agent as
provided above, it will be deemed that the LIBOR Base Rate for such Interest
Period cannot be determined.
"LIBOR Loans" shall mean Loans that bear interest at rates based on
-----------
rates referred to in the definition of "LIBO Rate" in this Section 1.01.
"Lien" shall mean, with respect to any Property, any mortgage, lien,
----
pledge, claim, charge, security interest or encumbrance of any kind, any other
type of preferential arrangement in respect of such Property having the effect
of a security interest, including any easement, right-of-way or other
encumbrance on title to Real Property.
"Loans" shall mean the Revolving Loans, the Swing Loans and the Term B
-----
Facility Loans.
"Losses" of any Person shall mean the losses, liabilities, claims
------
(including those based upon negligence, strict or absolute liability and
liability in tort), damages, reasonable expenses, obligations, penalties,
actions, judgments, encumbrances, liens, penalties, fines, suits, reasonable and
documented costs or disbursements of any kind or nature whatsoever (including
reasonable fees and
-23-
expenses of counsel in connection with any Proceeding commenced or threatened in
writing, whether or not such Person shall be designated a party thereto) at any
time (including following the payment of the Obligations) incurred by, imposed
on or asserted against such Person.
"Majority Lenders" shall mean (i) at any time prior to the Closing
----------------
Date, Lenders holding at least a majority of the aggregate principal amount of
the Commitments, and (ii) at any time after the Closing Date, Lenders holding at
least a majority of the sum of (without duplication) (a) the aggregate principal
amount of outstanding Loans (including outstanding Swing Loans for this purpose
as being Loans of each Lender in an amount equal to the aggregate principal
amount of Swing Loans outstanding multiplied by the R/C Percentage of such
Lender), plus (b) the Dollar Equivalent of the aggregate amount of all L/C
Liabilities, plus (c) the aggregate Unutilized R/C Commitments then in effect
(calculated for this purpose as if all outstanding Swing Loans were, instead,
Revolving Loans made by the Revolving Lenders in amounts equal to their
respective R/C Percentages of the aggregate amount of such outstanding Swing
Loans); provided, however, that (a) for purposes of this definition only, at any
-------- -------
time of determination, the sum of Obligations and Commitments held by Pitney
Xxxxx, Inc. and its Affiliates shall be deemed to be the lesser of (x)
$25,000,000 and (y) the amount of Obligations and Commitments actually held by
Pitney Xxxxx Inc. and such Affiliates at such time (for the avoidance of doubt
and without duplication, the denominator being used to calculate the majority in
principal amount shall be reduced by the amount of any adjustments required by
this proviso) and (b) from and after the time that, due solely to sales of their
Obligations and Commitments in bona fide arms'-length transactions to Persons
that are not Affiliates of Pitney Xxxxx Inc. or any of its Affiliates, Pitney
Xxxxx Inc. and such Affiliates hold, in the aggregate, $25,000,000 or less in
Obligations and Commitments, the provisions of the immediately preceding clause
(a) shall no longer be effective, regardless of whether after such time, Pitney
Xxxxx Inc. and such Affiliates hold, in the aggregate, in excess of $25,000,000
in Obligations and Commitments.
"Majority Revolving Lenders" shall mean (i) at any time prior to the
--------------------------
Closing Date, Lenders holding at least a majority of the aggregate amount of the
Revolving Commitment and (ii) at any time after the Closing Date, Lenders
holding at least a majority of the sum of (without duplication) (a) the
aggregate principal amount of outstanding Revolving Loans, plus (b) the Dollar
Equivalent of the aggregate amount of all L/C Liabilities, plus (c) the
aggregate Unutilized R/C Commitments then in effect (calculated for this purpose
as if all outstanding Swing Loans were, instead, Revolving Loans made by the
Revolving Lenders in amounts equal to their respective R/C Percentages of the
aggregate amount of such outstanding Swing Loans), plus (d) the aggregate amount
of Swing Loans then outstanding (treating an amount equal to the aggregate
principal amount of Swing Loans outstanding multiplied by the R/C Percentage of
each Lender as being held by such Lender for purposes of this definition).
"Margin Stock" shall mean margin stock within the meaning of
------------
Regulations U and X.
"Material Adverse Change" shall mean a material adverse change in the
-----------------------
business, results of operations, financial condition or prospects of the
Companies, taken as a whole.
"Material Adverse Effect" shall mean an event, circumstance,
-----------------------
occurrence, or condition which has caused as of any date of determination any of
(a) a material adverse effect on the busi-
-24-
ness, results of operations, financial condition or prospects of the Companies,
taken as a whole, (b) a material adverse effect on the ability of the Obligors
to consummate in a timely manner the Transactions or to perform any of their
material obligations under any Credit Document or (c) a material adverse effect
on the legality, binding effect or enforceability of any Credit Document or any
of the material rights and remedies of any Creditor thereunder or the legality,
priority or enforceability of the Lien on a material portion of the Collateral.
"Xxxxxxx Xxxxx" see the introduction to this Agreement.
-------------
"Minority Interest" shall mean an Investment in any Person that is not
-----------------
a Subsidiary (including any joint venture).
"Moody's" shall mean Xxxxx'x Investors Service, Inc.
-------
"Multiemployer Plan" shall mean a multiemployer plan within the
------------------
meaning of Section 4001(a)(3) of ERISA (i) to which any ERISA Entity is then
making or accruing an obligation to make contributions, (ii) to which any ERISA
Entity has within the preceding five plan years made contributions, including
any Person which ceased to be an ERISA Entity during such five year period, or
(iii) with respect to which any Company could incur liability.
"NAIC" shall mean the National Association of Insurance Commissioners.
----
"Net Available Proceeds" shall mean:
----------------------
(i) in the case of any Disposition Event, the amount of Net Cash
Payments received by the Person consummating such Disposition Event in
connection with such Disposition Event;
(ii) in the case of any Casualty Event, the aggregate amount of cash
proceeds of insurance, condemnation awards and other compensation received
by the Company whose Property was subject to such Casualty Event in respect
of such Casualty Event net of (A) fees and expenses incurred by such
Company in connection with recovery thereof, (B) repayments of Indebtedness
(other than the Obligations) to the extent secured by a Lien on such
Property that is permitted by the Credit Documents, (C) amounts required to
be paid to any Person (other than a Company) owning a direct or indirect
beneficial interest in the subject Property and (D) any taxes paid or
payable by any Company in respect of the amount so recovered (after
application of all credits and other offsets); and
(iii) in the case of any Debt Issuance, the aggregate amount of all
cash received in respect thereof by the Company consummating such Debt
Issuance in respect thereof net of (x) all investment banking fees,
discounts and commissions, legal fees, consulting fees, accountants' fees,
underwriting discounts and commissions and other fees and expenses,
actually incurred in connection therewith and (y) in the case of any Debt
Issuance by a Person that is not a Qualified Company, any amount required
to be paid to any Person (other than a Com-
-25-
pany) owning a direct or indirect interest in the Person effecting such
Debt Issuance in connection with the payment by such Person of such
proceeds to a Qualified Company.
"Net Cash Payments" shall mean, with respect to any Disposition Event,
-----------------
the aggregate amount of all cash payments (including any cash payments received
by way of deferred payment of principal pursuant to a note or installment
receivable or purchase price adjustment receivable or otherwise, but only as and
when received) received by any Company directly or indirectly in connection with
such Disposition Event, net (without duplication) of (i) the amount of all fees
and expenses paid by any Company in connection with such Disposition Event (the
"Relevant Disposition"); (ii) any taxes paid or estimated to be payable by any
--------------------
Company as a result of the Relevant Disposition or, in the case of payment
received by any Foreign Subsidiary, repatriation of the proceeds thereof to the
United States (after application of all credits and other offsets); (iii) any
repayments by any Company of Indebtedness (other than the Obligations) to the
extent that such Indebtedness is secured by a Lien on such Property that is
permitted by the Credit Documents; (iv) amounts required to be paid to any
Person (other than any Company) owning a direct or indirect beneficial interest
in the subject Property; and (v) amounts reserved, in accordance with GAAP,
against any liabilities associated with such Relevant Disposition and retained
by any Company after such Relevant Disposition and related thereto, including
pension and other post-employment benefit liabilities, liabilities related to
environmental matters and liabilities under any indemnification obligations
associated with such Relevant Disposition.
"Non-Qualified Subsidiary" shall mean any Subsidiary other than a
------------------------
Qualified Subsidiary.
"Non-U.S. Lender" see Section 5.06(b).
---------------
"Notes" shall mean the Revolving Notes, the Term B Facility Notes and
-----
the Swing Loan Notes.
"Notice of Assignment" shall mean a notice of assignment pursuant to
--------------------
Section 12.06 substantially in the form of Exhibit F.
---------
"Notice of Borrowing" shall mean a notice of borrowing substantially
-------------------
in the form of Exhibit G.
---------
"Obligations" shall mean all amounts, direct or indirect, contingent
-----------
or absolute, of every type or description, and at any time existing, owing by
any Obligor to any Creditor or any of its Related Parties or their respective
successors, transferees or assignees pursuant to the terms of any Credit
Document or any Swap Contract (including, without duplication, any Interest Rate
Protection Agreement) relating to the Loans or secured by any of the Security
Documents, whether or not the right of such Person to payment in respect of such
obligations and liabilities is reduced to judgment, liquidated, unliquidated,
fixed, contingent, matured, unmatured, disputed, undisputed, legal, equitable,
secured or unsecured and whether or not such claim is discharged, stayed or
otherwise affected by any bankruptcy case or insolvency or liquidation
proceeding.
-26-
"Obligors" shall mean Borrower and the Guarantors.
--------
"Officers' Certificate" shall mean, as applied to any corporation, a
---------------------
certificate executed on behalf of such corporation by its Chairman of the Board,
its Chief Executive Officer, its President, any of its Vice Presidents (or an
equivalent officer), its Chief Financial Officer, its Secretary, its Treasurer
(or an equivalent officer), any Assistant Treasurer, its Controller or any
Assistant Secretary, in their official (and not individual) capacities.
"Offshore Currency" shall mean the yen or the euro.
-----------------
"Offshore Currency Buffer" see Section 2.03(k).
------------------------
"Organic Document" shall mean, relative to any Person, its certificate
----------------
of incorporation, its by-laws, its partnership agreement, its memorandum and
articles of association, share designations or similar organization documents
and all shareholder agreements, voting trusts and similar arrangements to which
it is a party applicable to any of its authorized Equity Interests.
"Original Lenders" shall mean the Lenders named on the signature pages
----------------
hereof who were Lenders at the Effective Date.
"Other Taxes" see Section 5.06(c).
-----------
"Participant" see Section 12.05(d).
-----------
"Payment Date" shall mean any Principal Payment Date and each date on
------------
which interest is due and payable on any Loan.
"Payor" see Section 4.06.
-----
"PBGC" shall mean the United States Pension Benefit Guaranty
----
Corporation or any successor thereto.
"Pension Plan" shall mean an employee pension benefit plan (other than
------------
a Multiemployer Plan) which is covered by Title IV of ERISA or subject to the
minimum funding standards under Section 412 of the Code or Section 302 of ERISA
and is maintained or contributed to by any ERISA Entity or with respect to which
any Company could incur liability.
"Permits" see Section 8.16.
-------
"Permitted Acquisition" shall mean any Acquisition effected in
---------------------
compliance with Section 9.06(h).
"Permitted Customary Liens" shall mean (a) Liens imposed by any
-------------------------
Governmental Authority for taxes, assessments or charges not yet due or which
(i) are being contested in good faith and by appropriate proceedings if adequate
reserves with respect thereto are maintained on the books of the Companies, in
accordance with GAAP or (ii) in the aggregate would not have a Material Ad-
-27-
verse Effect; (b) Liens imposed by law which were incurred in the ordinary
course of business, such as carriers', warehousemen's, landlords' and mechanics'
Liens and other similar Liens, in each case for sums the payment of which is not
then required to have been made by Section 9.03; (c) pledges or deposits under
workers' compensation, unemployment insurance and other social security
legislation (including the Federal Employer's Liability Act) or deposits
securing the liability to insurance carriers, in each case arising in the
ordinary course of business; provided, however, that such Liens shall only
-------- -------
extend to or cover cash and Cash Equivalents not in the Collateral Account in an
aggregate amount not to exceed $8,000,000 at any time outstanding; (d) pledges
or deposits to secure the performance of bids, trade contracts (other than for
borrowed money), leases, statutory obligations, surety and appeal bonds,
performance bonds and other obligations of a like nature incurred in the
ordinary course of business under insurance or self insurance agreements; (e)
easements, rights-of-way, restrictions or defects or irregularities in title
incurred in the ordinary course of business and encumbrances consisting of
zoning restrictions, easements, licenses, restrictions on the use of Real
Property or minor imperfections in title thereto which, in the aggregate, do not
materially detract from the value of the Real Property subject thereto or
interfere with the ordinary conduct of the business of any Company; (f) Liens
consisting of judgment or judicial attachment Liens which do not result in an
Event of Default under Section 10(h) or (n); (g) any obligations or duties
affecting any of the Property of any Company to any municipality or public
authority with respect to any franchise, grant, license or permit which do not
materially impair the use of such Property for the purposes for which it is
held; (h) leases or subleases granted to third Persons not interfering in any
material respect with the business of any Company; (i) Liens arising from UCC
financing statements regarding leases permitted by this Agreement; (j) Liens in
favor of customs and revenue authorities arising as a matter of law to secure
payment of custom duties in connection with the importation of goods so long as
such Liens attach only to the imported goods; (k) Liens arising out of
consignment or similar arrangements for the sale of goods entered into by any
Company in the ordinary course of business; (l) Liens that are contractual,
statutory or common law rights of setoff; and (m) Liens on Intellectual Property
to the extent such Liens arise from the granting of licenses to use such
Intellectual Property in the ordinary course of business of any Company;
provided, however, that (x) with respect to clauses (a), (b), (c), and (d)
-------- -------
hereof (i) the obligations secured by such Liens are not yet delinquent or, to
the extent such amounts are so delinquent, such amounts are being contested in
good faith by appropriate proceedings for which adequate reserves have been
established in accordance with GAAP, or (ii) in the aggregate such Liens would
not have a Material Adverse Effect and (y) in the case of any such Lien against
any of the Collateral, such Lien and the contest thereof shall satisfy the
Contested Collateral Lien Conditions.
"Permitted Investments" shall mean: (a) operating deposit accounts and
---------------------
certificates of deposit with banks in the ordinary course of business; (b)
Investments that constitute Indebtedness or Contingent Obligations permitted
under Section 9.08; (c) extensions of credit in the nature of accounts
receivable or notes receivable arising from the sale or lease of goods or
services in the ordinary course of business and prepayments and other credits to
suppliers made in the ordinary course of business; (d) pledges or deposits in
connection with workers' compensation, unemployment insurance and other social
security or similar legislation; (e) pledges or deposits in connection with (i)
the performance of bids, trade contracts (other than for borrowed money), leases
or statutory obligations, (ii) contingent obligations on surety or appeal bonds,
and (iii) other non-delinquent obligations of a like nature, in each case
incurred in the ordinary course of business; (f) investments (including debt
-28-
obligations) received in connection with the bankruptcy or reorganization of
suppliers and customers and in settlement of delinquent obligations of, and
other disputes with, customers and suppliers arising in the ordinary course of
business; (g) Capital Expenditures (other than Acquisitions), expenditures
referred to in clauses (i) through (viii) of the proviso to the definition of
Capital Expenditure and Liens not prohibited by this Agreement; and (h) cash and
Cash Equivalents.
"Permitted Liens" see Section 9.07.
---------------
"Permitted Obligations" shall mean: (a) Contingent Obligations in
---------------------
respect of operating leases; (b) Indebtedness and Contingent Obligations arising
from honoring a check, draft or similar instrument against insufficient funds;
provided, however, that such Indebtedness is extinguished within five Business
-------- -------
Days of its incurrence; (c) Swap Contracts entered into in the ordinary course
of business as a bona fide hedge and not for speculative purposes; (d)
---- ----
Contingent Obligations in connection with Excluded Dispositions or Dispositions
permitted under Section 9.06, arising in connection with indemnification and
other agreements in respect of any contract relating to such Excluded
Disposition or Disposition (expressly excluding, however, any Contingent
Obligation in respect of any obligation of any third Person incurred in
connection with the acquisition of the Property which is the subject of such
Excluded Disposition or Disposition); (e) Indebtedness or Contingent Obligations
of any Company to (including obligations in respect of letters of credit for the
benefit of) any Person providing workers' compensation, health, disability or
other employee benefits or property, casualty or liability insurance to any
Company; and (f) Indebtedness or Contingent Obligations of any Company in
respect of performance bonds, bid bonds, appeal bonds, surety bonds and similar
obligations and trade letters of credit, in each case provided in the ordinary
course of business, including those incurred to secure health, safety and
environmental obligations in the ordinary course of business.
"Person" shall mean any individual, corporation, company, voluntary
------
association, partnership, joint venture, trust, unincorporated organization or
government (or any agency, instrumentality or political subdivision thereof).
"Pledged Collateral" shall mean all Property pledged pursuant to the
------------------
Security Agreement.
"Principal Office" shall mean the principal office of Administrative
----------------
Agent, located on the Effective Date at 000 Xxxxxxxxxxx Xxxxxxxxx, Xxxxxxxxxxx,
Xxxxxxxxxxx 00000, or such other office as may be designated by Administrative
Agent.
"Principal Payment Date" shall mean, with respect to the Term B
----------------------
Facility Loan, each Quarterly Date or other date set forth on Schedule 3.01(b)
----------------
on which a payment of principal is due with respect to the Term B Facility Loan.
"Prior Liens" shall mean Liens which, pursuant to the provisions of
-----------
any Security Document, are or may be superior to the Lien of such Security
Document.
-29-
"Proceeding" shall mean any claim, counterclaim, action, judgment,
----------
suit, hearing, governmental investigation, arbitration or proceeding by or
before any Governmental Authority, whether judicial or administrative, or
arbitrator.
"Profit Payment Agreement" shall mean any agreement to make any
------------------------
payment the amount of which is, or the terms of payment of which are, in any
respect subject to or contingent upon the revenues, income, cash flow, earnings
or profits (or the like) of any Person or business, other than any such
agreements with officers, directors or employees of the Borrower pursuant to
employment arrangements entered into in the ordinary course of business.
"Pro Forma Balance Sheet" see Section 8.02(D).
-----------------------
"Pro Forma Date" see Section 8.02(D).
--------------
"Property" shall mean any right, title or interest in or to property
--------
or assets of any kind whatsoever, whether real, personal or mixed and whether
tangible or intangible and including Equity Interests or other ownership
interests in any Person.
"Qualified Capital Stock" shall mean with respect to any Person any
-----------------------
Equity Interests of such Person which are not Disqualified Capital Stock.
"Qualified Company" shall mean Borrower and each Qualified Subsidiary.
-----------------
"Qualified Subsidiary" shall mean any Wholly Owned Subsidiary of
--------------------
Borrower that is or is required to be a Guarantor and a party to the Security
Agreement.
"Quarter" shall mean each three month period ending on March 31, June
-------
30, September 30 and December 31.
"Quarterly Dates" shall mean the last Business Day of each Quarter in
---------------
each year, commencing with the last Business Day of the first full Quarter after
the Closing Date; provided, however, that solely for purposes of Sections
-------- -------
2.05(a) and (b), the Quarterly Dates shall commence with the last Business Day
of the first full Quarter after the Effective Date.
"R/C Percentage" shall mean, with respect to any Revolving Lender, the
--------------
ratio of (a) the amount of the Revolving Commitment of such Lender to (b) the
aggregate amount of the Revolving Commitments of all of the Lenders.
"R/C Termination Date" shall mean the date that is the fifth
--------------------
anniversary of the Effective Date.
"Real Property" shall mean all right, title and interest of any
-------------
Company (including, without limitation, any leasehold estate) in and to a parcel
of real property owned or operated by any Company, whether by lease, license or
other use or occupancy agreement, together with, in each case, all improvements
and appurtenant fixtures, equipment, personal property, easements and other
property and rights incidental to the ownership, lease or operation thereof or
thereon.
-30-
"redeem" shall mean redeem, repurchase, repay, defease or otherwise
------
acquire or retire for value; and "redemption" and "redeemed" have correlative
---------- --------
meanings.
"refinance" shall mean refinance, renew, extend, replace, defease or
---------
refund, in whole or in part, including successively; and "refinancing" and
-----------
"refinanced" have correlative meanings.
----------
"Register" see Section 12.05(c).
--------
"Regulation D" shall mean Regulation D (12 C.F.R. Part 204) of the
------------
Board of Governors of the United States Federal Reserve System.
"Regulations U and X" shall mean, respectively, Regulation U (12
-------------------
C.F.R. Part 221) and Regulation X (12 C.F.R. Part 224) of the Board of Governors
of the United States Federal Reserve System (or any successor), as the same may
be modified and supplemented and in effect from time to time.
"Regulatory Change" shall mean, with respect to any Lender, any change
-----------------
after the Effective Date in United States Federal, state or foreign law or
regulations (including Regulation D) or the adoption or making after such date
of any interpretation, directive or request applying to a class of banks or
other financial institutions including such Lender of or under any Federal,
state or foreign law or regulations (whether or not having the force of law and
whether or not failure to comply therewith would be unlawful) by any court or
governmental or monetary authority or any other regulatory agency with proper
authority, including non-governmental agencies or bodies, charged with the
interpretation or administration thereof or by the NAIC.
"Reimbursement Obligations" shall mean, at any time, the obligations
-------------------------
of Borrower then outstanding, or that may thereafter arise in respect of all
Letters of Credit then outstanding, to reimburse amounts paid by L/C Lender in
respect of any drawings under a Letter of Credit.
"Related Parties" see Section 11.01.
---------------
"Related Person" of any Person shall mean any other Person owning
--------------
directly or indirectly (a) 10% or more of the outstanding common stock of such
Person or (b) 10% or more of the Voting Equity Interests of such Person in each
case, excluding any Person that files a Schedule 13G with respect to such Person
pursuant to the Exchange Act (and is qualified to do so).
"Release" shall mean any release, spill, emission, leaking, pumping,
-------
injection, deposit, disposal, discharge, dispersal, leaching or migration into
the environment.
"Rental Assets" shall mean the assets of the Companies which are
-------------
leased or rented, or held for lease, rent or sale to their customers in the
ordinary course of business; provided, however, that any such assets that are
-------- -------
held by any Company and that are not the subject of a lease, contract or other
agreement with a customer of such Company shall not be included as Rental Assets
but shall instead be included as Inventory.
"Replaced Lender" see Section 2.11.
---------------
-31-
"Replacement Lender" see Section 2.11.
------------------
"Required Payment" see Section 4.06.
----------------
"Requirement of Law" shall mean as to any Person, the Organic
------------------
Documents of such Person, and any Law or determination of any Governmental
Authority, in each case applicable to or binding upon such Person or any of its
Property or to which such Person or any of its Property is subject.
"Requisite Tranche Lenders" shall mean (i) with respect to Lenders
-------------------------
having Revolving Commitments or Revolving Loans, Majority Revolving Lenders, and
(ii) with respect to Lenders having Term B Facility Loans or Term B Facility
Commitments, Lenders having at least a majority of the aggregate sum of the Term
B Facility Loans and Term B Facility Commitments then outstanding; provided,
--------
however, that (a) for the purposes of clause (ii) of this definition only, at
-------
any time of determination, the amount of Term B Facility Loans and Term B
Facility Commitments held by Pitney Xxxxx, Inc. and its Affiliates shall be
deemed to be the lesser of (x) $25,000,000 and (y) the amount of Term B Facility
Loans and Term B Facility Commitments actually held by Pitney Xxxxx Inc. and
such Affiliates at such time (for the avoidance of doubt and without
duplication, the denominator being used to calculate the majority in principal
amount shall take into account any adjustments required by this proviso) and (b)
from and after the time that, due solely to sales of their Obligations and
Commitments in bona fide arms'-length transactions to Persons that are not
Affiliates of any of Pitney Xxxxx Inc. or its Affiliates, Pitney Xxxxx Inc. and
such Affiliates hold, in the aggregate, $25,000,000 or less in Obligations and
Commitments, the provisions of the immediately preceding clause (a) shall no
longer be effective, regardless of whether after such time, Pitney Xxxxx Inc.
and such Affiliates hold, in the aggregate, in excess of $25,000,000 in
Obligations and Commitments.
"Reserve Requirement" shall mean, for any Interest Period for any
-------------------
LIBOR Loan, the average maximum rate at which reserves (including any marginal,
supplemental or emergency reserves) are required to be maintained during such
Interest Period under Regulation D by member banks of the United States Federal
Reserve System in New York City with deposits exceeding one billion Dollars
against "Eurocurrency liabilities" (as such term is used in Regulation D).
"Reserves" shall mean such reserves, if any, as Administrative Agent
--------
may establish in such amounts, and with respect to such matters, as
Administrative Agent may deem necessary or appropriate in Administrative Agent's
Discretion, against the amount of Revolving Loans and Swing Loans which the
Obligors may otherwise request under Section 2.01, with respect to (a) sums
chargeable to the Obligors as Revolving Loans or Swing Loans under any section
of this Agreement, (b) amounts owing by any Obligor to any Person to the extent
secured by any Lien (other than Liens permitted under this Agreement) on, or
trust over, any Property of any Obligor and (c) a sum equal to 3 months' rent
for each Inventory location that is not subject to a Landlord Consent executed
by the lessor, warehouseman or other third party in favor of Administrative
Agent for the benefit of Lenders and as to which Borrower has made the election
referred to in clause (c)(i) of the definition of Eligible Inventory.
-32-
"Responsible Officer" shall mean, with respect to any Company, the
-------------------
chief executive officer, the president, the chief financial officer, any vice
president, the treasurer, any assistant treasurer, the controller, the secretary
or any assistant secretary of such Company.
"Revolving Commitment" shall mean, for each Revolving Lender, the
--------------------
obligation of such Lender to make Revolving Loans in an aggregate principal
amount at any one time outstanding up to but not exceeding the amount set
opposite the name of such Lender on Annex A under the caption "Revolving
-------
Commitment" (as the same may be reduced from time to time pursuant to Section
2.04 or changed pursuant to Section 12.05(b)). The initial aggregate amount of
the Revolving Commitments of all Lenders is $125,000,000.
"Revolving Facility" shall mean the credit facility comprising the
------------------
Revolving Commitments.
"Revolving Facility Maturity Date" shall mean the fifth anniversary of
--------------------------------
the Closing Date.
"Revolving Lenders" shall mean (a) on the Effective Date, the Original
-----------------
Lenders having Revolving Commitments, as indicated on Annex A hereto, and (b)
thereafter, the Lenders from time to time holding Revolving Loans and/or
Revolving Commitments after giving effect to any assignments thereof under
Section 12.05(b).
"Revolving Loans" see Section 2.01(a).
---------------
"Revolving Notes" shall mean promissory notes substantially in the
---------------
form of Exhibit A-1.
-----------
"Sale and Leaseback Transaction" shall mean any arrangement, directly
------------------------------
or indirectly, with any Person whereby it shall sell or transfer any Property
used or useful in its business, whether now owned or hereafter acquired, and
thereafter rent or lease such Property.
"S&P" shall mean Standard & Poor's, a division of The XxXxxx-Xxxx
---
Companies.
"Secured Parties" shall have the meaning assigned to such term in the
---------------
Security Agreement.
"Securities Act" shall mean the United States Securities Act of 1933,
--------------
as amended, and all rules and regulations of the Commission promulgated
thereunder.
"Security Agreement" shall mean a Security Agreement substantially in
------------------
the form of Exhibit D among the Obligors and Administrative Agent, as the same
---------
may be amended in accordance with the terms thereof and hereof or such other
agreements reasonably acceptable to Administrative Agent as shall be necessary
to comply with applicable Requirements of Law and effective to grant to
Administrative Agent (on behalf of the Creditors) a security interest in the
Pledged Collateral covered thereby which is perfected and has the priority
specified herein or therein or required hereunder or thereunder.
-33-
"Security Documents" shall mean the Security Agreement, the Landlord
------------------
Consents and each other security document or pledge agreement required by
applicable local law to grant a valid, perfected security interest in any
Property of the type covered by the Security Agreement that is acquired or
developed pursuant to a Permitted Acquisition and as to which a security
interest is required to be granted under Section 9.12 or 9.20, and all UCC or
other financing statements or instruments of perfection required by this
Agreement or the Security Agreement to be filed with respect to the security
interests in Property created pursuant to the Security Agreement and any other
document or instrument utilized to pledge as collateral for the Obligations any
Property of whatever kind or nature.
"Solvent" means, with respect to any Person on a particular date, that
-------
such Person is not insolvent (as such term is defined in the Uniform Fraudulent
Transfer Act).
"Special Dividend Payment" shall mean the cash payment from Borrower
------------------------
to Pitney Xxxxx Inc. to be declared prior to the Spin-Off.
"Spin-Off" means the distribution by Pitney Xxxxx Inc. to its
--------
shareholders of all of the capital stock of Borrower.
"Spot Rate" means, with respect to any Applicable Currency, at any
---------
date of determination thereof, the spot rate of exchange with respect to Dollars
for such date in New York that appears on the display page applicable to such
Applicable Currency on Reuters (or such other page as may replace such page on
such service for the purpose of displaying the spot rate of exchange in New
York); provided, however, that if there shall at any time no longer exist such a
-------- -------
page or a relevant spot rate is not shown on such service, the spot rate of
exchange shall be determined by reference to another similar rate publishing
service selected by Administrative Agent and if no such similar rate publishing
service is available by reference to the published rate of Bank in effect at
such date for similar commercial transactions.
"Subsidiary" shall mean, with respect to any Person, any corporation,
----------
partnership or other entity of which at least a majority of the securities or
other ownership interests having by the terms thereof ordinary voting power to
elect a majority of the board of directors or other persons performing similar
functions of such corporation, partnership or other entity (irrespective of
whether or not at the time securities or other ownership interests of any other
class or classes of such corporation, partnership or other entity shall have or
might have voting power by reason of the happening of any contingency) is at the
time directly or indirectly owned or controlled by such Person and/or one or
more Subsidiaries of such Person. Unless the context requires otherwise, all
references to any Subsidiary shall mean a Subsidiary of Borrower.
"Surety Instruments" shall mean all letters of credit (including
------------------
standby and commercial), bankers' acceptances, bank guarantees, surety bonds and
similar instruments.
"Swap Contract" shall mean any agreement (including any master
-------------
agreement and any schedule or agreement, whether or not in writing, relating to
any single transaction) that is an interest rate swap agreement, basis swap,
forward rate agreement, commodity swap, commodity option, equity
-34-
or equity index swap or option, bond option, interest rate option, foreign
exchange agreement, rate cap, collar or floor agreement, currency swap
agreement, cross-currency rate swap agreement, swaption, currency option or any
other similar agreement (including any option to enter into any of the
foregoing) and is designed to protect any Company against fluctuations in
interest rates, currency exchange rates, commodity prices, or similar risks
(including any Interest Rate Protection Agreement entered into pursuant to
Section 9.18).
"Swing Loan Commitment" shall mean the obligation of the Swing Loan
---------------------
Lender to make or continue Swing Loans hereunder in an aggregate principal
amount up to but not exceeding $10,000,000, as the same may be reduced or
terminated pursuant to Section 2.04 or Section 10, it being understood that the
Swing Loan Commitment is part of the Revolving Commitment of the Swing Loan
Lender, rather than a separate, independent commitment.
"Swing Loan Lender" shall mean Administrative Agent and its successors
-----------------
and assigns in such capacity.
"Swing Loan Notes" shall mean promissory notes substantially in the
----------------
form of Exhibit A-3.
-----------
"Swing Loans" see Section 2.01(d).
-----------
"Syndication Agent" see the introduction hereto.
-----------------
"Tax Returns" see Section 8.08.
-----------
"Taxes" shall mean any and all taxes, imposts, duties, charges, fees,
-----
levies or other charges or assessments of whatever nature, including income,
gross receipts, excise, real or personal property, sales, withholding, social
security, retirement, unemployment, occupation, use, service, license, net
worth, payroll, franchise, and transfer and recording, imposed by the Internal
Revenue Service or any taxing authority (whether domestic or foreign, including
any federal, state, U.S. possession, county, local or foreign government or any
subdivision or taxing agency thereof), whether computed on a separate,
consolidated, unitary, combined or any other basis, including interest, fines,
penalties or additions to tax attributable to or imposed on or with respect to
any such taxes, charges, fees, levies or other assessments.
"Term B Facility" shall mean the credit facility comprising the Term B
---------------
Facility Commitments and the Term B Facility Loans.
"Term B Facility Commitment" shall mean, for each Term B Facility
--------------------------
Lender, the obligation of such Lender to make a Term B Facility Loan in an
amount up to but not exceeding the amount set opposite the name of such Lender
on Annex A under the caption "Term B Facility Commitment" (as the same may be
-------
changed pursuant to Section 12.05(b)). The initial aggregate amount of the Term
B Facility Commitments of all Lenders is $100,000,000.
"Term B Facility Lenders" shall mean (a) on the Effective Date, the
-----------------------
Original Lenders having Term B Facility Commitments, as indicated on Annex A
hereto, and (b) thereafter, the Lenders
-35-
from time to time holding Term B Facility Loans and Term B Facility Commitments
after giving effect to any assignments thereof under Section 12.05(b).
"Term B Facility Loans" see Section 2.01(b).
---------------------
"Term B Facility Loans Maturity Date" shall mean the Final Maturity
-----------------------------------
Date.
"Term B Facility Notes" shall mean promissory notes substantially in
---------------------
the form of Exhibit A-2.
-----------
"Test Date" shall mean, for any Financial Maintenance Covenant, the
---------
last day of each fiscal quarter of Borrower.
"Total Debt" shall mean, at any date, the aggregate amount of
----------
Indebtedness of Consolidated Companies (not including, for purposes of this
definition, any Indebtedness referred to in clause (i) of the definition thereof
or any Indebtedness referred to in clause (g) or (j) of the definition thereof,
to the extent such Indebtedness of others is of the type referred to in such
clause (i)) at such date plus the aggregate undrawn available amount of all
undrawn Letters of Credit or any other letter of credit at such date, in each
case determined on a consolidated basis in conformity with GAAP.
"Total Leverage Ratio" shall mean, for any Test Date, the ratio of (x)
--------------------
Total Debt at such Test Date (net of cash and Cash Equivalents held by the
Qualified Companies at such date in an amount not to exceed $15,000,000) to (y)
Consolidated EBITDA for the four fiscal quarters ending on such Test Date.
Notwithstanding the foregoing, until the first anniversary of the Closing Date,
for purposes of such ratio, Consolidated EBITDA shall be calculated on a pro
forma basis as if the Transactions had occurred on the first day of the relevant
period.
"Tranche" shall mean (i) with respect to Lenders, each of the
-------
following classes of Lenders: (a) Lenders having Revolving Loans (including
Swing Loans, with Swing Loans being allocated to Revolving Lenders for this
purpose as set forth in the proviso to the definition of Majority Revolving
Lenders) or Revolving Commitments, and (b) Lenders having Term B Facility
Commitments or Term B Facility Loans, and (ii) with respect to Loans, each of
the following classes of Loans and Commitments: (a) Revolving Loans (including
Swing Loans, with Swing Loans being allocated to Revolving Lenders for this
purpose as set forth in the proviso to the definition of Majority Revolving
Lenders) or Revolving Commitments and (b) Term B Facility Commitments or Term B
Facility Loans.
"Transaction Documents" shall mean this Agreement and the Distribution
---------------------
Agreement and in each case all documents related thereto and all exhibits,
appendices, schedules and annexes to any thereof.
"Transactions" shall mean the financings and transactions to occur on
------------
the Closing Date, including the Spin-Off, the Special Dividend Payment and the
entering into of borrowings hereunder.
"Trigger Date" see the definition of Applicable Margin.
------------
-36-
"Type" see Section 1.03.
----
"UCC" shall mean the Uniform Commercial Code (including, for the
---
avoidance of doubt, the provisions of Article 9 thereof, as revised through the
date hereof) as in effect on the date hereof in the State of New York; provided,
--------
however, that if by reason of mandatory provisions of law, the perfection or the
-------
effect of perfection or non-perfection of the security interest in any item or
portion of the Collateral is governed by the Uniform Commercial Code as in
effect in a jurisdiction other than the State of New York, "UCC" shall mean the
Uniform Commercial Code as in effect in such other jurisdiction for purposes of
the provisions hereof relating to such perfection or effect of perfection or
non-perfection.
"Unutilized R/C Commitment" shall mean, for any Revolving Lender, at
-------------------------
any time, the excess of such Lender's Revolving Commitment at such time over the
sum of (i) the aggregate outstanding principal amount of Revolving Loans made by
such Lender, (ii) such Lender's R/C Percentage of the Dollar Equivalent of the
aggregate amount of L/C Liabilities at such time and (iii) with respect to the
Swing Loan Lender only, the aggregate principal amount of Swing Loans then
outstanding.
"Weighted Average Life to Maturity" shall mean, on any date and with
---------------------------------
respect to the Revolving Commitments or the Term B Facility Loans, an amount
equal to (i) the sum, for each scheduled repayment of Term B Facility Loans to
be made after such date, or each scheduled reduction of Revolving Commitments to
be made after such date, of the amount of such scheduled repayment or reduction
multiplied by the number of days from such date to the date of such scheduled
prepayment or reduction divided by (ii) the aggregate principal amount of such
Term B Facility Loans or such Revolving Commitments, as the case may be.
"Wholly Owned Subsidiary" shall mean, with respect to any Person, any
-----------------------
corporation, partnership or other entity of which all of the Equity Interests
(other than, in the case of a corporation, directors' qualifying shares or
nominee shares required under applicable law) are directly or indirectly owned
or controlled by such Person and/or one or more Wholly Owned Subsidiaries of
such Person. Unless the context requires otherwise, all references to any
Wholly Owned Subsidiary shall mean a Wholly Owned Subsidiary of Borrower.
"Withdrawal Liability" shall mean liability to a Multiemployer Plan as
--------------------
a result of a complete or partial withdrawal from such Multiemployer Plan, as
such terms are defined in Part 1 of Subtitle E of Title IV of ERISA.
1.02. Accounting Terms and Determinations. Except as otherwise
-----------------------------------
provided in this Agreement, all computations and determinations as to accounting
or financial matters (including Financial Maintenance Covenants and other
financial covenants) shall be made in accordance with GAAP consistently applied
for all applicable periods, and all accounting or financial terms shall have the
meanings ascribed to such terms by GAAP; provided, however, that, if Borrower
-------- -------
notifies the Lead Arranger and the Administrative Agent that Borrower wishes to
amend the calculation of the Total Leverage Ratio for purposes of determining
the Applicable Margins or to amend any covenant in Section 9, in either case to
eliminate the effect of any change in GAAP (as to which Borrower shall give
-37-
notice of such change to the Lead Arranger and the Lenders within a reasonable
time after such change) on the operation of such calculation or covenant (or if
the Lead Arranger and the Administrative Agent notify Borrower that the Majority
Lenders wish to amend any such calculation or covenant for such purpose), then
such calculation or Borrower's compliance with such covenant, as the case may
be, shall be determined on the basis of GAAP in effect immediately before the
relevant change in GAAP became effective, until either such notice is withdrawn
or such calculation or covenant is amended in a manner satisfactory to Borrower
and the Majority Lenders. All financial statements to be delivered pursuant to
this Agreement shall be prepared in accordance with GAAP.
1.03. Classes and Types of Loans. Loans hereunder are
--------------------------
distinguished by "Class" and by "Type". The "Class" of a Loan (or of a
-----
Commitment to make a Loan) refers to whether such Loan is a Revolving Loan,
Swing Loan or Term B Facility Loan, each of which constitutes a Class. The
"Type" of a Loan refers to whether such Loan is an ABR Loan or a LIBOR Loan,
----
each of which constitutes a Type. Loans may be identified by both Class and
Type.
1.04. Rules of Construction. (a) In each Credit Document, unless
---------------------
the context requires otherwise (or such other Credit Document provides
otherwise), references to (i) the plural include the singular, the singular
include the plural and the part include the whole; (ii) Persons include their
respective permitted successors and assigns or, in the case of governmental
Persons, Persons succeeding to the relevant functions of such Persons; (iii)
agreements (including this Agreement), promissory notes and other contractual
instruments include subsequent amendments, assignments, and other modifications
thereto, but only to the extent such amendments, assignments or other
modifications thereto are not prohibited by the terms of any Credit Document;
(iv) statutes and related regulations include any amendments of the same and any
successor statutes and regulations; (v) unless otherwise expressly provided, any
reference to any action of any Creditor by way of consent, approval or waiver
shall, to the fullest extent permitted under applicable law, deemed modified by
the phrase "in its/their sole discretion"; and (vi) time shall be a reference to
New York City time. Where any provision herein refers to action to be taken by
any Person, or which such Person is prohibited from taking, such provision shall
be applicable whether such action is taken directly or indirectly by such
Person.
(b) In each Credit Document, unless the context requires otherwise
(or such other Credit Document provides otherwise), (i) "amend" shall mean
-----
"amend, restate, amend and restate, supplement or modify"; and "amended,"
--------
"amending" and "amendment" shall have meanings correlative to the foregoing;
-------- ---------
(ii) in the computation of periods of time from a specified date to a later
specified date, "from" shall mean "from and including"; "to" and "until" shall
---- -- -----
mean "to but excluding"; and "through" shall mean "to and including"; (iii)
-------
"hereof," "herein" and "hereunder" (and similar terms) in any Credit Document
------ ------ ---------
refer to such Credit Document as a whole and not to any particular provision of
such Credit Document; (iv) "including" (and similar terms) shall mean "including
---------
without limitation" (and similarly for similar terms); (v) "or" has the
--
inclusive meaning represented by the phrase "and/or"; (vi) "satisfactory to" any
---------------
Creditor shall mean in form, scope and substance and on terms and conditions
satisfactory to such Creditor; (vii) references to "the date hereof" shall mean
---------------
the date first set forth above; (viii) "asset" and "property" shall have the
----- --------
same meaning and effect and refer to all tangible and intangible assets and
property, whether real, personal or mixed and of every type and description; and
(ix) a "fiscal year" and a "fiscal quarter" are references to a fiscal year or
----------- --------------
fiscal quarter of Borrower.
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(c) In this Agreement unless the context requires otherwise, any
reference to (i) an Annex, Exhibit or Schedule is to an Annex, Exhibit or
Schedule, as the case may be, attached to this Agreement and constituting a part
hereof, and (ii) a Section or other subdivision is to a Section or such other
subdivision of this Agreement.
(d) This Agreement and the other Credit Documents are the result of
negotiations among and have been reviewed by counsel to Agents, Borrower and the
other parties, and are the products of all parties. Accordingly, they shall not
be construed against the Lenders or Agents merely because of Agents' or Lenders'
involvement in their preparation.
Section 2. Commitments, Letters of Credit, Conversions and
Continuations, Fees, Register, Prepayments and
Replacement of Lenders
-----------------------------------------------
2.01. Loans.
-----
(a) Revolving Loans. Subject to the terms and conditions of this
---------------
Agreement, each Lender with a Revolving Commitment agrees severally, and not
jointly or jointly and severally, to make revolving loans (the "Revolving
---------
Loans") to Borrower in Dollars during the period from and including the Closing
-----
Date to but not including the R/C Termination Date in an aggregate principal
amount at any one time outstanding not exceeding such Lender's R/C Percentage of
an amount equal to the Borrowing Base minus the aggregate amount of all L/C
Liabilities. Subject to the terms and conditions of this Agreement, during such
period Borrower may borrow, repay and reborrow the amount of the Revolving
Commitments by means of ABR Loans and LIBOR Loans.
(b) Term B Facility Loans. Each Term B Facility Lender agrees,
---------------------
severally and not jointly or jointly and severally, on the terms and conditions
of this Agreement, to make a term loan ("Term B Facility Loans") to Borrower in
---------------------
Dollars on the Closing Date in an aggregate principal amount equal to the Term B
Facility Commitment of such Lender. Term B Facility Loans that are repaid or
prepaid may not be reborrowed.
(c) Limit on LIBOR Loans. No more than 10 separate Interest Periods
--------------------
in respect of LIBOR Loans may be outstanding at any one time.
(d) Swing Loans. Subject to the terms and conditions of this
-----------
Agreement, upon request of Borrower, the Swing Loan Lender agrees to make one or
more loans ("Swing Loans") to Borrower from time to time from and including the
-----------
Closing Date to but excluding the R/C Termination Date, in an amount not to
exceed the Swing Loan Commitment as then in effect. Prior to the R/C
Termination Date, Borrower may borrow, repay and reborrow Swing Loans up to the
Swing Loan Commitment in accordance with the terms of this Agreement. The Swing
Loan Lender shall not make any Swing Loans on or after the R/C Termination Date.
No Swing Loan shall be made if, after giving full effect to the requested Swing
Loan, the aggregate outstanding amount of Revolving Loans, plus the aggregate
outstanding amount of Swing Loans, plus the aggregate outstanding L/C
Liabilities would exceed the Borrowing Base as in effect at such time. All
Swing Loans will be made and maintained only as ABR Loans. The Swing Loan
Lender shall not make any Swing Loan after receiving a written notice from
Borrower or the Majority Revolving Lenders stating that a Default exists and is
-39-
continuing until such time as the Swing Loan Lender shall have received written
notice of (i) rescission of all such notices from the party or parties
originally delivering such notice, (ii) the waiver of such Default by the
Majority Lenders, or (iii) Administrative Agent's good faith determination that
such Default has ceased to exist. Swing Loans shall be made (i) in minimum
amounts of $500,000 and integral multiples of $100,000 above such amount, (ii)
in the aggregate unused amount of the Swing Loan Commitment or (iii) in the
amount of any Reimbursement Obligation to be paid with the proceeds of such
Swing Loan.
Upon the occurrence of an Event of Default, each Revolving Lender
shall be deemed to have purchased (and each Revolving Lender hereby irrevocably
agrees to purchase) an irrevocable participation in all outstanding Swing Loans,
together with all accrued interest thereon equal to such Lender's R/C Percentage
thereof, without any further action by or on behalf of the Swing Loan Lender,
any other Lender, Borrower or any other Person. Upon one Business Day's notice
from the Swing Loan Lender, each other Revolving Lender shall deliver to the
Swing Loan Lender an amount equal to its respective participation in such Swing
Loan (as determined pursuant to the immediately preceding sentence) in
immediately available funds. In order to evidence such participation, each
Revolving Lender agrees to enter into a participation agreement at the request
of the Swing Loan Lender in form and substance satisfactory to the Swing Loan
Lender and the Revolving Lender. If any Revolving Lender fails to make
available to the Swing Loan Lender the amount of such Revolving Lender's
participation as provided in this paragraph, the Swing Loan Lender shall be
entitled to recover such amount on demand from such Revolving Lender, together
with interest thereon at the Federal Funds Rate until such amount is paid in
full in immediately available funds. In the event the Swing Loan Lender
receives a payment from any Obligor of any amount in which the Revolving Lenders
have purchased participations as provided in this paragraph, the Swing Loan
Lender shall promptly distribute to each Revolving Lender its pro rata share of
--- ----
such payment. Notwithstanding anything herein to the contrary, each Revolving
Lender's obligation to purchase a participation in each unpaid Swing Loan shall
be absolute and unconditional and shall not be affected by any circumstances,
including (1) any setoff, counterclaim, recoupment, defense or other right which
such Revolving Lender may now or hereafter have against the Swing Loan Lender,
Borrower or any other Person for any reason whatsoever, (2) the occurrence or
continuation of a Default or an Event of Default, (3) the occurrence of any
Material Adverse Change or (4) any other circumstance, happening or event
whatsoever, whether or not similar to any of the foregoing, except that no
Revolving Lender need participate in any Swing Loan made by the Swing Loan
Lender in violation of the penultimate sentence of the first paragraph of this
Section 2.01(d).
(e) Limit on Loans and Letters of Credit. Notwithstanding anything
------------------------------------
to the contrary contained in this Section 2.01 or elsewhere in this Agreement,
no Lender shall, pursuant to this Section 2.01 or otherwise, make any Loan or
issue any Letter of Credit to or for the account of Borrower, and Borrower shall
not be entitled to borrow, if after giving effect to the requested Loan or
Letter of Credit (and any immediate use of the proceeds thereof), the aggregate
amount of Revolving Loans then outstanding, plus the aggregate amount of Swing
Loans then outstanding, plus the Dollar Equivalent of the aggregate L/C
Liabilities then outstanding, less the amount of any L/C cover that shall have
been provided and not yet returned would exceed the Borrowing Base then in
effect.
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2.02. Borrowings. Borrower shall give Administrative Agent notice of
----------
each borrowing hereunder as provided in Section 4.05. The form of such notice of
borrowing shall be substantially in the form of Exhibit G. Not later than 12:00
---------
noon New York City time on the date specified for each borrowing hereunder, each
Lender shall make available the amount of the Loan or Loans to be made by it on
such date to Administrative Agent, at an account specified by Administrative
Agent, in immediately available funds, for the account of Borrower. Each
borrowing of Revolving Loans shall be made by each Revolving Lender pro rata
--------
based on its R/C Percentage. The amounts so received by Administrative Agent
shall, subject to the terms and conditions of this Agreement, be made available
to Borrower by depositing the same, in immediately available funds, in an
account of Borrower maintained with Bank at the Principal Office designated by
Borrower.
2.03. Letters of Credit. Subject to the terms and conditions hereof,
-----------------
the Revolving Commitment may be utilized, upon the request of Borrower, in
addition to the Revolving Loans provided for by Section 2.01(a), for standby and
commercial documentary letters of credit in Dollars or, if an L/C Lender
notifies the Borrower and Administrative Agent it is capable of doing so, in an
Offshore Currency (herein collectively called "Letters of Credit") issued by any
-----------------
L/C Lender for the account of any Company (provided, that Borrower shall be
--------
obligated in respect of all Reimbursement Obligations and any other obligations
in respect of each Letter of Credit, regardless of for whose account such Letter
of Credit was issued); provided, however, that in no event shall (i) the sum of
-------- -------
the aggregate amount of Revolving Loans then outstanding, plus the aggregate
amount of Swing Loans then outstanding, plus the Dollar Equivalent of the
aggregate L/C Liabilities then outstanding, less the amount of any L/C cover
that shall have been provided and not yet returned at any time exceed the
Borrowing Base in effect at such time, (ii) the sum of the aggregate principal
amount of Revolving Loans then outstanding made by any Revolving Lender, plus
such Lender's R/C Percentage of the aggregate principal amount of Swing Loans
then outstanding, plus such Lender's R/C Percentage of the Dollar Equivalent of
the aggregate amount of all L/C Liabilities exceed such Lender's Revolving
Commitment as in effect at such time, (iii) the outstanding aggregate Dollar
Equivalent of the amount of all L/C Liabilities exceed $50,000,000, (iv) the
Dollar Equivalent of the available amount of any Letter of Credit be on the date
of issuance thereof less than $50,000, (v) the expiration date of any Letter of
Credit extend beyond the earlier of (x) the fifth Business Day preceding the R/C
Termination Date and (y) the date twelve months following the date of such
issuance for standby Letters of Credit or 180 days after the date of such
issuance for commercial documentary Letters of Credit, unless the Majority
Revolving Lenders have approved such expiry date in writing (but never beyond
the fifth Business Day prior to the R/C Termination Date); provided, however,
-------- -------
that any standby Letter of Credit may be automatically extendible for periods of
up to one year (but never beyond the fifth Business Day preceding the R/C
Termination Date) so long as such Letter of Credit provides that the applicable
L/C Lender retains an option satisfactory to such L/C Lender to terminate such
Letter of Credit prior to each extension date, unless all of the Revolving
Lenders have approved such expiry date in writing, (vi) any L/C Lender issue any
Letter of Credit after it has received notice from Borrower or the Majority
Revolving Lenders stating that a Default exists until such time as such L/C
Lender shall have received written notice of (x) rescission of such notice from
the Majority Revolving Lenders, (y) waiver of such Default in accordance with
this Agreement or (z) Administrative Agent's good faith determination that such
Default has ceased to exist, or (vii) a letter of credit be issued at a tenor
other than sight; provided, however, that no standby letter of credit shall be
-------- -------
issued in a currency other than Dollars. The following additional provisions
shall apply to Letters of Credit:
-41-
(a) Borrower shall give Administrative Agent and the applicable L/C
Lender at least three Business Days' irrevocable prior notice (effective
upon receipt) pursuant to a Letter of Credit application satisfactory to
such L/C Lender specifying the Applicable Currency, the date (which shall
be no later than thirty days preceding the R/C Termination Date) each
Letter of Credit is to be issued and the L/C Lender that is to issue such
Letter of Credit and describing in reasonable detail the proposed terms of
such Letter of Credit (including the beneficiary thereof) (including
whether such Letter of Credit is to be a commercial Letter of Credit or a
standby Letter of Credit). Each Lender hereby authorizes each L/C Lender to
issue, and perform its obligations under, Letters of Credit to be issued by
it. Letters of Credit shall be issued or extended in accordance with the
customary procedures of the applicable L/C Lender, which may include an
application for Letters of Credit. Any L/C Lender may refuse to issue or
extend any Letter of Credit the contents of which are not reasonably
satisfactory to it. If there is any conflict between the procedures and any
Letter of Credit application required by an L/C Lender and this Agreement,
this Agreement shall govern.
(b) On each day during the period commencing with the issuance by an
L/C Lender of any Letter of Credit and until such Letter of Credit shall
have expired or been terminated, the Revolving Commitment of each Revolving
Lender shall be deemed to be utilized for all purposes hereof in an amount
equal to such Lender's R/C Percentage of the then undrawn Dollar Equivalent
calculated pursuant to Section 2.03(k) of the available amount of such
Letter of Credit plus the Dollar Equivalent calculated pursuant to Section
2.03(k) of the amount of any unreimbursed drawings thereunder. Each
Revolving Lender (other than the applicable L/C Lender) severally agrees
that, upon the issuance of any Letter of Credit hereunder, it shall
automatically acquire a participation in the applicable L/C Lender's
obligation to fund drawings and rights under such Letter of Credit in an
amount equal to such Lender's R/C Percentage of the Dollar Equivalent
calculated pursuant to Section 2.03(k) of such obligations and rights, and
each Revolving Lender (other than such L/C Lender) thereby shall
absolutely, unconditionally and irrevocably assume, as primary obligor and
not as surety, and shall be unconditionally obligated to such L/C Lender to
pay and discharge when due, its R/C Percentage of the Dollar Equivalent
calculated pursuant to Section 2.03(k) of such L/C Lender's obligation to
fund drawings under such Letter of Credit. Each L/C Lender shall be deemed
to hold an L/C Liability in an amount equal to its retained interest in the
related Letter of Credit issued by it after giving effect to such
acquisition by the Revolving Lenders other than such L/C Lender of their
participation interests.
(c) In the event that an L/C Lender has determined to honor a drawing
under a Letter of Credit issued by it, such L/C Lender shall promptly
notify Borrower (through Administrative Agent) of the amount paid by such
L/C Lender and the date on which payment is to be made to such beneficiary.
Borrower hereby unconditionally agrees to pay and reimburse L/C Lender for
the amount of payment under such Letter of Credit, together with interest
thereon at the Alternate Base Rate plus the Applicable Margin applicable to
Revolving Loans from the date payment was made to such beneficiary to the
date on which payment is due, not later than the Business Day upon which
Borrower receives such notice from such L/C Lender (or the Business Day
thereafter if such notice is received on a date that is not a Business Day
or after 12:00 noon, New York City time, on a Business Day). Any such
payment due from Bor-
-42-
rower and not paid on the required date shall bear interest at rates
specified in Section 3.02(b).
(d) Forthwith upon its receipt of a notice referred to in clause (c)
of this Section 2.03, Borrower shall advise the applicable L/C Lender
whether or not Borrower intends to borrow hereunder to finance its
obligation to reimburse such L/C Lender for the amount of the related
demand for payment and, if it does, submit a notice of such borrowing as
provided in Section 4.05. In the event that Borrower fails to so advise
Administrative Agent, or if Borrower fails to reimburse the applicable L/C
Lender for a demand for payment under a Letter of Credit on the date of
such notice (or the Business Day thereafter if such notice is received on a
date that is not a Business Day or after 12:00 noon, New York City time, on
a Business Day), Administrative Agent shall give each Revolving Lender
prompt notice of the amount of the demand for payment, specifying such
Lender's R/C Percentage of the amount of the related demand for payment.
(e) Each Revolving Lender (other than the L/C Lender that shall have
issued the applicable Letter of Credit) shall pay to Administrative Agent
for account of such L/C Lender in the Dollar Equivalent (as calculated by
Administrative Agent) of such Lender's R/C Percentage of any payment under
a Letter of Credit (but never to exceed its R/C Commitment) upon not less
than one Business Day's actual notice by the applicable L/C Lender (through
Administrative Agent) to such Revolving Lender requesting such payment and
specifying such amount. Subject to the proviso to the last paragraph of
this Section 2.03, each such Revolving Lender's obligation to make such
payments to Administrative Agent for the account of L/C Lender under this
clause (e), and L/C Lender's right to receive the same, shall be absolute
and unconditional and shall not be affected by any circumstance whatsoever,
including (i) the failure of any other Revolving Lender to make its payment
under this clause (e), (ii) the financial condition of Borrower or the
existence of any Default or (iii) the termination of the Commitments. Each
such payment to an L/C Lender shall be made without any offset, abatement,
withholding or reduction whatsoever.
(f) Upon the making of each payment by a Revolving Lender to an L/C
Lender pursuant to clause (e) above in respect of any Letter of Credit,
such Lender shall, automatically and without any further action on the part
of Administrative Agent, the applicable L/C Lender or such Lender, acquire
(i) a participation in an amount equal to such payment in the Reimbursement
Obligation owing to such L/C Lender by Borrower hereunder and under the L/C
Documents relating to such Letter of Credit and (ii) a participation in a
percentage equal to such Lender's R/C Percentage in any interest or other
amounts payable by Borrower hereunder and under such L/C Documents in
respect of such Reimbursement Obligation. Upon receipt by an L/C Lender
from or for the account of Borrower of any payment in respect of any
Reimbursement Obligation or any such interest or other amounts (including
by way of setoff or application of proceeds of any collateral security) in
each case in respect of a Letter of Credit issued by such L/C Lender, such
L/C Lender shall promptly pay to Administrative Agent for the account of
each Revolving Lender which has satisfied its obligations under clause (e)
above, such Revolving Lender's R/C Percentage of such payment, each such
payment by any L/C Lender to be made in the Applicable Currency of the
payment made by such
-43-
Revolving Lender. In the event any payment received by any L/C Lender and
so paid to the Revolving Lenders hereunder is rescinded or must otherwise
be returned by such L/C Lender, each Revolving Lender shall, upon the
request of such L/C Lender (through Administrative Agent), repay to such
L/C Lender (through Administrative Agent) the amount of such payment paid
to such Lender, with interest at the rate specified in clause (i) of this
Section 2.03.
(g) Borrower shall pay to Administrative Agent for the account of the
Revolving Lenders in respect of each Letter of Credit a letter of credit
commission for each day during the period from and including the date of
issuance of such Letter of Credit (i) in the case of a Letter of Credit
which expires in accordance with its terms, to and including such
expiration date and (ii) in the case of a Letter of Credit which is drawn
in full or is otherwise terminated other than on the stated expiration date
of such Letter of Credit, to but excluding the date such Letter of Credit
is drawn in full or is terminated at a rate equal to the product of (x) (A)
with respect to standby Letters of Credit the rate per annum equal to the
---------
Applicable Margin for Revolving Loans that are LIBOR Loans in effect from
time to time and (B) with respect to commercial documentary Letters of
Credit, 50% of the rate specified in immediately preceding clause (A),
multiplied by (y) the undrawn Dollar Equivalent of the available amount of
such Letter of Credit on such day, such fee to be non-refundable and to be
paid in arrears quarterly, on each Quarterly Date, and on the earlier of
the R/C Termination Date or the date of the termination of the Revolving
Commitment. In addition, Borrower shall pay to Administrative Agent for
the account of each L/C Lender in respect of each Letter of Credit issued
by such L/C Lender a letter of credit fronting fee for each day during the
period from and including the date of issuance of such Letter of Credit (i)
in the case of a Letter of Credit which expires in accordance with its
terms, to and including such expiration date and (ii) in the case of a
Letter of Credit which is drawn in full or is otherwise terminated other
than on the stated expiration date of such Letter of Credit, to but
excluding the date such Letter of Credit is drawn in full or is terminated
at a rate equal to 0.125% per annum multiplied by the Dollar Equivalent of
the available amount of such Letter of Credit, such fee to be non-
refundable and paid quarterly in arrears on each Quarterly Date and on the
earlier of the R/C Termination Date and the R/C Termination Date, plus all
charges, costs and expenses in the amounts customarily charged by L/C
Lender from time to time in like circumstances with respect to the
issuance, amendment or transfer of each Letter of Credit and drawings and
other transactions relating thereto.
(h) Upon the issuance of a standby Letter of Credit, the applicable
L/C Lender shall deliver (through Administrative Agent) to each Revolving
Lender a notice describing such standby Letter of Credit, and promptly
following the end of each week, each L/C Lender shall deliver (through
Administrative Agent) to each Revolving Lender and Borrower a notice
describing the aggregate amount of all Letters of Credit issued by such L/C
Lender and outstanding at the end of such week (including the Dollar
Equivalent thereof). Upon the request of any Revolving Lender from time to
time (through Administrative Agent), each L/C Lender shall deliver any
other information reasonably requested by such Lender with respect to each
Letter of Credit issued by such L/C Lender that is then outstanding.
-44-
(i) To the extent that any Revolving Lender fails to pay an amount
required to be paid pursuant to clause (e) or (f) of this Section 2.03 on
the due date therefor, such Lender shall pay interest to the applicable L/C
Lender (through Administrative Agent) on such amount from and including
such due date to but excluding the date such payment is made at a rate per
---
annum equal to the Federal Funds Rate (as in effect from time to time).
-----
(j) The issuance by any L/C Lender of any amendment, modification or
supplement to any Letter of Credit issued by it hereunder that would extend
the expiry date or increase the available amount thereof shall be subject
to the same conditions applicable under this Section 2.03 to the issuance
of new Letters of Credit, and no such modification or supplement shall be
issued hereunder unless either (x) the respective Letter of Credit affected
thereby would have complied with such conditions had it originally been
issued hereunder on the date of such modification or supplement in such
modified or supplemented form or (y) the Majority Revolving Lenders (or all
of the Revolving Lenders to the extent required by Section 12.04) shall
have consented thereto.
(k) (i) Notwithstanding the foregoing, no L/C Lender shall be under
any obligation to issue any Letter of Credit if at the time of such
issuance, any order, judgment or decree of any Governmental Authority or
arbitrator shall purport by its terms to enjoin or restrain such L/C Lender
from issuing such Letter of Credit or any requirement of law applicable to
such L/C Lender or any request or directive (whether or not having the
force of law) from any Governmental Authority shall prohibit the issuance
of letters of credit generally or such Letter of Credit in particular or
shall impose upon such L/C Lender with respect to such Letter of Credit any
restriction or reserve or capital requirement (for which such L/C Lender is
not otherwise compensated) not in effect on the date hereof. At any time
that any L/C Lender shall not be under any obligation to issue Letters of
Credit pursuant to this paragraph (k), such L/C Lender may be replaced by
Borrower with another Lender reasonably acceptable to Administrative Agent
upon notice to such L/C Lender and Administrative Agent and acceptance of
such appointment by such successor L/C Lender. Upon any such replacement,
Administrative Agent shall notify the Lenders of any such replacement of
any L/C Lender and the replacement L/C Lender shall agree to be bound by
the applicable provisions of this Agreement. At the time any such
replacement shall become effective, Borrower shall pay all unpaid fees
accrued for the account of the replaced L/C Lender pursuant to Section
2.03(g). From and after the effective date of any such replacement, (x)
the successor L/C Lender shall have all the rights and obligations of an
L/C Lender under this Agreement with respect to Letters of Credit to be
issued by it thereafter and (y) references herein to the term "L/C Lender"
shall be deemed to include such successor or to any previous L/C Lender, or
to such successor and all previous L/C Lenders, as the context shall
require. After the replacement of an L/C Lender hereunder, the replaced
L/C Lender shall remain a party hereto and shall continue to have all the
rights and obligations of an L/C Lender under this Agreement with respect
to Letters of Credit issued by it prior to such replacement, but shall not
be required to issue additional Letters of Credit.
(ii) If on the last Business Day of any month there are any Letters of
Credit outstanding that are denominated in an Offshore Currency,
Administrative Agent will calculate
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the difference between the Dollar Equivalent of all related L/C Liabilities
on such day and the Dollar Equivalent of the amount of such L/C Liabilities
that are covered by currency hedging arrangements satisfactory in all
respects to Administrative Agent (such difference, the "Aggregate Offshore
------------------
Currency Exposure"), and deduct an amount equal to 5% of the Aggregate
-----------------
Offshore Currency Exposure (the "Offshore Currency Buffer") from the
------------------------
Borrowing Base then in effect.
The obligations of Borrower under this Agreement and any L/C Document
to reimburse an L/C Lender for a drawing under a Letter of Credit issued by such
L/C Lender, shall be unconditional and irrevocable, and shall, to the fullest
extent permitted under applicable law, be paid strictly in accordance with the
terms of this Agreement and each such other L/C Document under all
circumstances, including the following: (i) any lack of validity or
enforceability of this Agreement or any L/C Document; (ii) the existence of any
claim, setoff, defense or other right that Borrower may have at any time against
any beneficiary or any transferee of any Letter of Credit (or any Person for
whom any such beneficiary or any such transferee may be acting), any L/C Lender
or any other Person, whether in connection with this Agreement, the transactions
contemplated hereby or by the L/C Documents or any unrelated transaction; (iii)
any draft, demand, certificate or other document presented under any Letter of
Credit proving to be forged, fraudulent, invalid or insufficient in any respect
or any statement therein being untrue or inaccurate in any respect; or any loss
or delay in the transmission or otherwise of any document required in order to
make a drawing under any Letter of Credit; or any defense based upon the failure
of any drawing under a Letter of Credit to conform to the terms of the Letter of
Credit or any non-application or misapplication by the beneficiary of the
proceeds of such drawing; or (iv) any other circumstance or happening
whatsoever, whether or not similar to any of the foregoing, including any other
circumstance that might otherwise constitute a defense available to, or a
discharge of, Borrower or a Guarantor; provided, however, that neither Borrower
-------- -------
nor any Revolving Lender shall be obligated to reimburse any L/C Lender for any
wrongful payment finally determined by a court of competent jurisdiction to have
been made by such L/C Lender as a result of acts or omissions constituting
willful misconduct or gross negligence on the part of such L/C Lender. To the
extent that any provision of any L/C Document is inconsistent with the
provisions of this Section 2.03, the provisions of this Section 2.03 shall
control.
2.04. Termination and Reductions of Commitments. (a) (i) The
-----------------------------------------
Commitments shall be automatically and permanently terminated on November 30,
2001 if the Closing Date does not occur on or prior to such date.
(ii) The aggregate amount of the Revolving Commitments shall be
automatically and permanently reduced to zero on the R/C Termination Date.
(iii) The aggregate amount of the Term B Facility Commitments shall
be automatically and permanently reduced immediately after the making of the
Term B Facility Loans on the Closing Date to zero.
(b) Borrower shall have the right at any time or from time to time
(without premium or penalty except breakage costs (if any) pursuant to Section
5.05)) (i) so long as no Revolving Loans or L/C Liabilities will be outstanding
as of the date specified for termination, to terminate the Revolv-
-46-
ing Commitments in their entirety, and (ii) to reduce the aggregate amount of
the Unutilized R/C Commitments (which reduction shall be pro rata among
--- ----
Revolving Lenders in proportion to their respective R/C Percentages); provided,
--------
however, that (x) Borrower shall give notice of each such termination or
-------
reduction as provided in Section 4.05, and (y) each partial reduction shall be
in an aggregate amount at least equal to $1,000,000 (or a larger multiple of
$1,000,000) or, if less, the remaining Unutilized R/C Commitments.
(c) Any Commitment once terminated or reduced may not be reinstated.
2.05. Fees. (a) Borrower shall pay to Administrative Agent for
----
the account of each Revolving Lender a commitment fee for each day during the
period from and including the Effective Date to but not including the earlier of
the date such Revolving Commitment is terminated and the R/C Termination Date,
on such Lender's Unutilized R/C Commitment, at a rate per annum equal to the
---------
Applicable R/C Fee Percentage for such day. Any accrued commitment fee under
this Section 2.05(a) shall be payable in arrears on each Quarterly Date and on
the earlier of the date the Revolving Commitments are terminated or expire and
the R/C Termination Date.
(b) Borrower shall pay to Administrative Agent for its own account
the annual administrative fee pursuant to Administrative Agent's Fee Letter.
2.06. Lending Offices. The Loans of each Type made by each Lender
---------------
shall be made and maintained at such Lender's Applicable Lending Office for
Loans of such Type.
2.07. Several Obligations of Lenders. The failure of any Lender to
------------------------------
make any Loan to be made by it on the date specified therefor shall not relieve
any other Lender of any obligation such other Lender may have to make a Loan on
such date, but neither any Lender nor Administrative Agent shall be responsible
for the failure of any other Lender to make a Loan to be made by such other
Lender. No Revolving Lender will be responsible for failure of any other Lender
to fund its participation in Swing Loans or Letters of Credit.
2.08. Notes; Register. (a) At the request of any Lender, its
---------------
Loans of a particular Class shall be evidenced by a promissory note, dated the
Closing Date, payable to such Lender (or its nominee) and otherwise duly
completed, substantially in the form of Exhibits X-0, X-0 xxx X-0 for such
------------ --- ---
Lender's Revolving Loans, Term B Facility Loans and Swing Loans, respectively.
(b) The date, amount, Type, interest rate and duration of the
Interest Period (if applicable) of each Loan of each Class made by each Lender
and each payment made on account of the principal thereof, shall be recorded by
such Lender (or its nominee) on its books and, prior to any transfer of any Note
evidencing the Loans of such Class held by it, endorsed by such Lender (or its
nominee) on the schedule attached to such Note or any continuation thereof;
provided, however, that the failure of such Lender (or its nominee) to make any
-------- -------
such recordation or endorsement or any error in such recordation or endorsement
shall not affect the obligations of Borrower to make a payment when due of any
amount owing hereunder or under such Note.
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2.09. Optional Prepayments and Conversions or Continuations of Loans.
--------------------------------------------------------------
Subject to Section 4.04, Borrower shall have the right to prepay Loans, or to
Convert Loans of one Type into Loans of another Type or to Continue Loans of one
Type as Loans of the same Type, at any time or from time to time. Borrower
shall give Administrative Agent notice of each such prepayment, Conversion or
Continuation as provided in Section 4.05 (and, upon the date specified in any
such notice of prepayment, the amount to be prepaid shall become due and payable
hereunder). Each notice of Conversion or Continuation shall be substantially in
the form of Exhibit H. If LIBOR Loans are prepaid or Converted other than on
---------
the last day of an Interest Period therefor, Borrower shall at such time pay all
expenses and costs required by Section 5.05. Notwithstanding the foregoing, and
without limiting the rights and remedies of the Lenders under Section 10, in the
event that any Event of Default shall have occurred and be continuing,
Administrative Agent may (and at the request of the Majority Lenders shall)
suspend the right of Borrower to Convert any Loan into a LIBOR Loan, or to
Continue any Loan as a LIBOR Loan, in which event all Loans shall be Converted
(on the last day(s) of the respective Interest Periods therefor) or Continued,
as the case may be, as ABR Loans. Prepayments of the Term B Facility Loans
pursuant to this Section 2.09 shall be applied pro rata to the remaining
--- ----
scheduled amortization payments in respect thereof.
2.10. Mandatory Prepayment and Commitment Reductions. (a)
----------------------------------------------
Borrower shall prepay the Loans (and/or reduce Commitments) as follows (each
such prepayment (and/or Commitment reduction) to be effected in each case in the
manner, order and to the extent specified in subsection (b) below of this
Section 2.10):
(i) Casualty Events. Within 10 Business Days after any Company
---------------
receives any Net Available Proceeds from any Casualty Event, in an
aggregate principal amount equal to 100% of such Net Available Proceeds;
provided, however, that
-------- -------
(x) the Net Available Proceeds shall not be required to be so
applied on such date to the extent that Borrower has delivered an
Officers' Certificate to Administrative Agent on or prior to such date
stating that such proceeds shall be used to fund the acquisition or
construction of Property used or usable in the business of the
Companies or repair, replace or restore the Property in respect of
which such Casualty Event has occurred, in each case within 365 days
following the date of the receipt of such Net Available Proceeds, and
(y) if all or any portion of such Net Available Proceeds not
required to be applied to the prepayment of Loans pursuant to the
preceding proviso (x) is not so used within 365 days after the date of
the receipt of such Net Available Proceeds, such remaining portion
shall be applied on the last day of such period as specified in
Section 2.10(b).
(ii) Debt Issuance. Within one Business Day after any Debt Issuance
-------------
on or after the Closing Date (other than any Debt Issuance permitted under
Section 9.08), in an aggregate principal amount equal to 100% of the Net
Available Proceeds of such Debt Issuance.
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(iii) Disposition Events. Within 10 Business Days after receipt by
------------------
any Company of any Net Available Proceeds from any Disposition Event
permitted under Section 9.06(g), in an aggregate principal amount equal to
100% of the Net Available Proceeds from such Disposition Event; provided,
--------
however, that
-------
(x) the Net Available Proceeds from any Disposition Event
permitted by Section 9.06(g) shall not be required to be applied as
provided herein on such date if Borrower delivers an Officers'
Certificate to Administrative Agent on or prior to such date stating
that such Net Available Proceeds shall be reinvested in capital assets
of the Companies within 365 days following the date of such
Disposition Event (which certificate shall set forth the estimates of
the proceeds to be so expended), and
(y) if all or any portion of such Net Available Proceeds which
are permitted to be applied to reinvestment pursuant to the terms of
this Section 2.10(a)(iii) is not so used within such 365-day period,
such remaining portion shall be applied on the last day of such period
(or such earlier date as Borrower determines not to reinvest any
portion thereof) as specified in Section 2.10(b) (it being understood
that the foregoing shall in no way affect the obligation of any
Company to obtain the consent of the Majority Lenders if required
pursuant to this Agreement to effect any Disposition).
(b) Application. The amount of any required prepayments described in
-----------
Section 2.10(a) shall be applied to prepay Loans and/or reduce Commitments as
follows:
(i) First, the amount of the required prepayment shall be applied to
-----
the Term B Facility Loans pro rata to the remaining scheduled amortization
--- ----
payments in respect thereof.
(ii) Second, after such time as the Term B Facility Loans are no
------
longer outstanding, the Revolving Loans shall be repaid in an amount equal
to the remaining amount of any such required prepayment that would have
been applied to the Term B Facility Loans (at the same time that the
prepayment of the Term B Facility Loans would have been made and assuming
an unlimited amount thereof then outstanding).
(iii) Third, after application of prepayments in accordance with
-----
clauses (i) and (ii) above, Borrower shall be permitted to retain any such
remaining excess.
Notwithstanding the foregoing, if the amount of any prepayment of
Loans required under this Section 2.10 shall be in excess of the amount of the
ABR Loans at the time outstanding, only the portion of the amount of such
prepayment as is equal to the amount of such outstanding ABR Loans shall be
immediately prepaid and, at the election of Borrower, the balance of such
required prepayment shall be either (i) deposited in the Collateral Account and
applied to the prepayment of LIBOR Loans on the last day of the then next-
expiring Interest Period for LIBOR Loans (with all interest accruing thereon for
the account of Borrower) or (ii) prepaid immediately, together with any amounts
owing to the Lenders under Section 5.05. Notwithstanding any such deposit in
the Collateral Account, interest shall continue to accrue on such Loans until
prepayment.
-49-
(c) Borrowing Base Shortfall. Subject to the proviso contained in
------------------------
Section 9.01(j), at any time that a reduction in the Borrowing Base causes the
sum of the aggregate amount of Revolving Loans then outstanding, plus the
aggregate amount of Swing Loans then outstanding, plus the Dollar Equivalent of
the aggregate L/C Liabilities then outstanding, less the amount of any L/C cover
that shall have been provided and not yet returned to exceed the Borrowing Base
then in effect (after giving effect to the aforementioned reduction), Borrower
shall immediately prepay Swing Loans and the Revolving Loans (and/or provide
cover for L/C Liabilities as specified in Section 2.10(d)), such prepayment to
be applied, first, to the Swing Loans, second, to Revolving Loans outstanding
----- ------
and, third, as cover for L/C Liabilities outstanding as specified in Section
-----
2.10(d). If at any time following the provision of cover for L/C Liabilities
pursuant to this Section 2.10(c) the Borrowing Base then in effect shall exceed
the sum of the aggregate amount of Revolving Loans then outstanding, plus the
aggregate amount of Swing Loans then outstanding, plus the Dollar Equivalent of
the aggregate L/C Liabilities then outstanding, less the amount of any L/C cover
that shall have been provided and not yet returned, Administrative Agent shall
release and return to Borrower L/C cover in an amount equal to the lesser of (i)
such excess and (ii) all such cover then held by Administrative Agent.
(d) Cover for L/C Liabilities. In the event that Borrower shall be
-------------------------
required pursuant to this Section 2.10 to provide cover for L/C Liabilities,
Borrower shall effect the same by paying to Administrative Agent immediately
available funds in an amount equal to the required amount, which funds shall be
retained by Administrative Agent in the Collateral Account (as provided in the
Security Agreement as collateral security in the first instance for the L/C
Liabilities) until such time as all Letters of Credit shall have been terminated
and all of the L/C Liabilities paid in full.
2.11. Replacement of Lenders. Borrower shall have the right to
----------------------
replace any Lender (the "Replaced Lender") with one or more other Eligible
---------------
Assignees reasonably acceptable to the Lead Arranger (collectively, the
"Replacement Lender") if (x) such Lender is charging Borrower increased costs
-------------------
pursuant to Section 5.01 or 5.06 in excess of those being charged generally by
the other Lenders or such Lender becomes incapable of making LIBOR Loans as
provided in Section 5.03 when other Lenders are generally able to do so, (y) as
provided in Section 12.04(ii), such Lender refuses to consent to certain
proposed amendments, waivers or modifications with respect to this Agreement or
(z) such Lender shall have failed to fund any Loan required to have been funded
by it hereunder when other Lenders have generally funded their Loans included in
the same borrowing; provided, however, that (i) at the time of any replacement
-------- -------
pursuant to this Section 2.11, the Replacement Lender shall enter into one or
more assignment agreements (with all fees payable pursuant to Section 12.05 to
be paid by the Replacement Lender or Borrower) pursuant to which the Replacement
Lender shall acquire all of the Commitments and outstanding Loans of, and all of
the participations in Swing Loans and L/C Liabilities of, the Replaced Lender
and, in connection therewith, shall pay to (x) the Replaced Lender, an amount
equal to the sum of (A) the principal of, and all accrued interest on, all
outstanding Loans of the Replaced Lender, (B) all Reimbursement Obligations
owing to such Replaced Lender, together with all then unpaid interest with
respect thereto at such time, and (C) all accrued, but theretofore unpaid, fees
owing to the Replaced Lender pursuant to Section 2.05, and (y) L/C Lender, an
amount equal to such Replaced Lender's R/C Percentage of any Reimbursement
Obligations (which at such time remains a Reimbursement Obligation) to the
extent such amount was required to have been but was not theretofore funded by
such Replaced Lender pursuant to Section 2.03(e), and (ii) all obligations of
Borrower owing to the Replaced Lender (other than those specifi-
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cally described in clause (i) above in respect of which the assignment purchase
price has been, or is concurrently being, paid, but, except in the case of a
replacement of a Lender described in clause (z) above, including any amounts
which would be paid to a Lender pursuant to Section 5.05 if Borrower were
prepaying a LIBOR Loan) shall be paid in full to such Replaced Lender
concurrently with such replacement. Upon the execution of the respective
assignment agreement, the payment of amounts referred to in clauses (i) and (ii)
above and, if so requested by the Replacement Lender, delivery to the
Replacement Lender of Notes executed by Borrower, the Replacement Lender shall
become a Lender hereunder and the Replaced Lender shall cease to constitute a
Lender hereunder and be released of all its obligations as a Lender, except with
respect to indemnification provisions applicable to the Replaced Lender under
this Agreement, which shall survive as to such Replaced Lender.
Section 3. Payments of Principal and Interest.
----------------------------------
3.01. Repayment of Loans.
------------------
(a) Revolving Credit and Swing Loans. Borrower hereby promises to
--------------------------------
pay to Administrative Agent for the account of each Revolving Lender the entire
outstanding principal amount of such Revolving Lender's Revolving Loans, and
each Revolving Loan shall mature, on the R/C Termination Date. Borrower hereby
promises to pay the Swing Loan Lender for its account the entire outstanding
principal amount of the Swing Loans, and the Swing Loans shall mature, on the
R/C Termination Date.
(b) Term B Facility Loans. Borrower hereby promises to pay to
---------------------
Administrative Agent for the pro rata accounts of the Term B Facility Lenders,
--------
in repayment of the principal of the Term B Facility Loans, on each date set
forth on Schedule 3.01(b), the amount set forth opposite such date in such
----------------
Schedule 3.01(b) (subject to adjustment for any prepayments made under Section
----------------
2.09 or Section 2.10 to the extent actually made).
3.02. Interest. (a) Borrower hereby promises to pay to
--------
Administrative Agent for the account of each Lender interest on the unpaid
principal amount of each Loan made or maintained by such Lender for each day
during the period from and including the date such Loan is made to but excluding
the date such Loan shall be paid in full at the following rates per annum:
---------
(i) for each day that such Loan is an ABR Loan, the Alternate Base
Rate for such day, plus the Applicable Margin for the applicable Class for
such day, and
(ii) for each day that such Loan is a LIBOR Loan, for each Interest
Period relating thereto, the LIBO Rate for such Loan for such Interest
Period, plus the Applicable Margin for the applicable Class for such day.
(b) All principal of, and interest on, Loans hereunder, and all fees
and other amounts payable hereunder, that are not paid when due shall thereafter
bear interest at (i) in the case of overdue principal of, and interest on, any
Loan at a rate per annum equal to 2% per annum above the rate per annum required
---------- ---------- ----------
to be paid on such Loan pursuant to subsections (a)(i) and (a)(ii) above, and
-51-
(ii) all other overdue Obligations at the rate which is 2% in excess of the rate
otherwise applicable to ABR Loans which are Revolving Loans from time to time.
(c) Accrued interest on each Loan shall be payable (i) in the case of
an ABR Loan, quarterly on each Quarterly Date, (ii) in the case of a LIBOR Loan,
on the last day of each Interest Period therefor and, if such Interest Period is
longer than three months, at three-month intervals following the first day of
such Interest Period and (iii) in the case of any LIBOR Loan, upon the payment
or prepayment thereof or the Conversion of such Loan to a Loan of another Type
(but only on the principal amount so paid, prepaid or Converted), except that
interest payable pursuant to Section 3.02(b) shall be payable from time to time
on demand. Promptly after the determination of any interest rate provided for
herein or any change therein, Administrative Agent shall give notice thereof to
the Lenders to which such interest is payable and to Borrower.
Section 4. Payments; Pro Rata Treatment; Computations; Etc.
-----------------------------------------------
4.01. Payments. (a) All payments of principal, interest,
--------
Reimbursement Obligations and other amounts to be made by Borrower under this
Agreement and the Notes, and, except to the extent otherwise provided therein,
all payments to be made by the Obligors under any other Credit Document, shall
be made in Dollars, in immediately available funds, without deduction, set-off
or counterclaim, to Administrative Agent at its designated account, not later
than 1:00 p.m. New York City time on the date on which such payment shall become
due (each such payment made after such time on such due date to be deemed, if
Administrative Agent so elects, to have been made on the next succeeding
Business Day).
(b) Borrower shall, at the time of making each payment under this
Agreement or any Note for the account of any Lender, specify (in accordance with
Section 2.09 and 2.10, if applicable) to Administrative Agent (which shall so
notify the intended recipient(s) thereof) the Class and Type of Loans,
Reimbursement Obligations or other amounts payable by Borrower hereunder to
which such payment is to be applied (and in the event that Borrower fails to so
specify, or if an Event of Default has occurred and is continuing,
Administrative Agent may distribute such payment to the Lenders for application
to the Obligations under the Credit Documents in such manner as it or the
Majority Lenders, subject to Sections 2.09, 2.10 and 4.02, may determine to be
appropriate).
(c) Except to the extent otherwise provided in the second sentence of
Section 2.03(g), each payment received by Administrative Agent or by an L/C
Lender (through Administrative Agent) under this Agreement or any Note for the
account of any Lender shall be paid by Administrative Agent or by each L/C
Lender (through Administrative Agent), as the case may be, to such Lender, in
immediately available funds, (x) if the payment was actually received by
Administrative Agent or by each L/C Lender (through Administrative Agent), as
the case may be, prior to 11:00 a.m. (New York City time) on any day, on such
day and (y) if the payment was actually received by Administrative Agent or by
each L/C Lender (through Administrative Agent), as the case may be, after 11:00
a.m. (New York City time) on any day, by 1:00 p.m. (New York City time) on the
following Business Day (it being understood that to the extent that any such
payment is not made in full by Administrative Agent or by each L/C Lender
(through Administrative Agent), as the case may be, Administrative Agent shall
pay to such Lender, upon demand, interest at the Federal Funds Rate from the
-52-
date such amount was required to be paid to such Lender pursuant to the
foregoing clauses until the date Administrative Agent pays such Lender the full
amount).
(d) If the due date of any payment under this Agreement or any Note
would otherwise fall on a day that is not a Business Day, such date shall be
extended to the next succeeding Business Day (unless, in the case of any payment
of principal of or interest on any LIBOR Loan, such extension would cause the
date of such payment to fall in a different calendar month, in which case the
date for such payment shall be the next preceding Business Day), and interest
shall be payable for any principal so extended for the period of such extension
at the rate then borne by such principal.
4.02. Pro Rata Treatment. Except to the extent otherwise provided
------------------
herein: (a) each borrowing of Loans of a particular Class from the Lenders
under Section 2.01 shall be made from the Lenders holding Commitments of such
Class, each payment of commitment fees under Section 2.05 in respect of
Commitments of a particular Class shall be made for the account of the Lenders
holding Commitments of such Class and each termination or reduction of the
amount of the Commitments of a particular Class under Section 2.04 shall be
applied to the respective Commitments of such Class of the relevant Lenders, pro
---
rata according to the amounts of their respective Commitments of such Class;
----
except that Swing Loans shall be made only by, and interest thereon shall be
------
paid by Borrower only to, the Swing Loan Lender (subject to such Lender's
obligation in respect of any participation therein purchased by the other
Revolving Lenders as provided in Section 2.01(d)); (b) except as otherwise
provided in Section 5.04, LIBOR Loans of any Class having the same Interest
Period shall be allocated pro rata among the relevant Lenders according to the
--------
amounts of their respective Revolving Commitments and Term B Facility
Commitments (in the case of the making of Loans) or their respective Revolving
Loans and Term B Facility Loans (in the case of Conversions and Continuations of
Loans); (c) each payment or prepayment of principal of Revolving Loans or Term B
Facility Loans shall be made for the account of the relevant Lenders pro rata in
--------
accordance with the respective unpaid outstanding principal amounts of the Loans
of such Class held by them; and (d) each payment of interest on Revolving Loans
and Term B Facility Loans shall be made for the account of the relevant Lenders
pro rata in accordance with the amounts of interest on such Loans then due and
--------
payable to the respective Lenders.
4.03. Computations. Interest on LIBOR Loans, commitment fees and
------------
Letter of Credit fees shall be computed on the basis of a year of 360 days and
actual days elapsed (including the first day but excluding the last day)
occurring in the period for which such amounts are payable, and interest on ABR
Loans and Reimbursement Obligations shall be computed on the basis of a year of
365 or 366 days, as the case may be, and actual days elapsed (including the
first day but excluding the last day) occurring in the period for which such
amounts are payable. Notwithstanding the foregoing, for each day that the
Alternate Base Rate is calculated by reference to the Federal Funds Rate,
interest on ABR Loans and Reimbursement Obligations shall be computed on the
basis of a year of 360 days and actual days elapsed (including the first day but
excluding the last day).
4.04. Minimum Amounts. Except for mandatory prepayments made
---------------
pursuant to Section 2.10 and Conversions or prepayments made pursuant to Section
5.04, each borrowing, Conversion and prepayment of principal of Loans (other
than Swing Loans, for which the minimum amounts thereof are set forth in Section
2.01(g)) shall be in an amount at least equal to $1.0 million and in mul-
-53-
tiples of $100,000 in excess thereof (borrowings, Conversions or prepayments of
or into Loans of different Types or, in the case of LIBOR Loans, having
different Interest Periods at the same time hereunder to be deemed separate
borrowings, Conversions and prepayments for purposes of the foregoing, one for
each Type or Interest Period); provided that borrowings of Revolving Loans may
--------
be made in (i) the amount of any Reimbursement Obligation to be paid with the
proceeds of such Loans and (ii) the aggregate Unutilized R/C Commitments then
available (taking into account the Borrowing Base as set forth in the Borrowing
Base Certificate then most recently delivered). Anything in this Agreement to
the contrary notwithstanding, the aggregate principal amount of LIBOR Loans
having the same Interest Period shall be in an amount at least equal to $1.0
million and in multiples of $100,000 in excess thereof and, if any LIBOR Loans
or portions thereof would otherwise be in a lesser principal amount for any
period, such Loans or portions, as the case may be, shall be ABR Loans during
such period.
4.05. Certain Notices. Notices by Borrower to Administrative Agent
---------------
of terminations or reductions of the Commitments, of borrowings, Conversions,
Continuations and optional prepayments of Loans and of Classes of Loans, of
Types of Loans and of the duration of Interest Periods shall be irrevocable and
shall be effective only if received by Administrative Agent by telephone not
later than 11:00 a.m.(or, solely in the case of a borrowing by Borrower to
reimburse an L/C Lender pursuant to Section 2.03(d), 1:00 p.m.) New York City
time (promptly followed by written notice via telecopier) on the Business Day
of, or the number of Business Days prior to, the date of the relevant
termination, reduction, borrowing, Conversion, Continuation or prepayment or the
first day of such Interest Period specified in the table below (and not later
than 12 noon New York City time on the Business Day of the borrowing or
prepayment in the case of Swing Loans).
NOTICE PERIODS
--------------
Notice Number of Business Days Prior
------ -----------------------------
Termination or reduction of Commitments 2
Borrowing or optional prepayment of, or
Conversions into, ABR Loans (other than Swing
Loans) Same day
Borrowing or optional prepayment of, Conversions
into, Continuations as, or duration of Interest
Periods for, LIBOR Loans 3
Each such notice of termination or reduction shall specify the amount
and the Class of the Commitments to be terminated or reduced. Each such notice
of borrowing, Conversion, Continuation or prepayment shall specify the Class of
Loans to be borrowed, Converted, Continued or prepaid and the amount (subject to
Section 4.04) and Type of each Loan to be borrowed, Converted, Continued or
prepaid and the date of borrowing, Conversion, Continuation or prepayment (which
shall be a Business Day). Each such notice of the duration of an Interest
Period shall specify the Loans to which such Interest Period is to relate. If
any amount (other than any amount in respect of interest or principal on the
Loans or in respect of Reimbursement Obligations) required to be paid
-54-
under this Agreement shall become due and remains unpaid, on and after the sixth
day following the day that Administrative Agent has notified Borrower that such
amount has become due and is unpaid, the Administrative Agent may cause such
event to be deemed irrevocably a request for a Revolving Loan on any Business
Day on or after such sixth day designated by Administrative Agent and in the
amount required to pay any portion of such amount that remains unpaid. If any
amount in respect of interest, principal or in respect of Reimbursement
Obligations is required to be paid under this Agreement and shall become due and
remains (i) in the case of interest, unpaid at 11:00 a.m., New York City time,
on the third Business Day after such amount has become due, (ii) in the case of
principal, unpaid at 11:00 a.m., New York City time, on the Business Day such
amount becomes due and (iii) in the case of a Reimbursement Obligation, on the
Business Day on which such amount has become due, unless the applicable L/C
Lender gives notice to Borrower of a repayment demand after 12 noon on such date
or a day which is not a Business Day, in which case, if such amount remains
unpaid at 1:00 p.m. on the next succeeding Business Day, Administrative Agent
may cause such event to be deemed irrevocably a request for a Revolving Loan for
such unpaid amount on the Business Day specified in the immediately preceding
clause (i), (ii) or (iii), as applicable. on Unless otherwise consented to by
Agents in their sole discretion, prior to the earlier of (x) five days after the
Closing Date and (y) the date on which Borrower has been notified by the Lead
Arranger that the primary syndication of the Commitments has been completed, no
borrowing of or Conversion into any LIBOR Loan may be made, and, in addition to
the foregoing limitation, prior to the earlier of (x) thirty days after the
Closing Date and (y) the date on which Borrower has been notified by the Lead
Arranger that the primary syndication of the Commitments has been completed, no
Interest Period of more than one month may be elected. Administrative Agent
shall promptly notify the Lenders of the contents of each such notice. In the
event that Borrower fails to select the Type of Loan, or the duration of any
Interest Period for any LIBOR Loan, within the time period and otherwise as
provided in this Section 4.05, such Loan (i) if outstanding as a LIBOR Loan,
will, in the case of a Revolving Loan, be automatically Converted into an ABR
Loan or, in the case of a Term B Facility Loan, be automatically continued as a
LIBOR Loan having an Interest Period of one month, in each case, on the last day
of the then current Interest Period for such Loan or (ii) if outstanding as an
ABR Loan, will remain as, or (if not then outstanding) will be made as, an ABR
Loan.
As an accommodation to Borrower, Administrative Agent may permit
telephonic or electronic requests for Loans and telephonic or electronic
transmittal of instructions, authorizations, agreements or reports to
Administrative Agent from Borrower. Unless Borrower specifically directs
Administrative Agent in writing not to accept or act upon telephonic or
electronic communications from Borrower, Administrative Agent shall have no
liability to Borrower or any Obligor for any loss or damage suffered by Borrower
or any Obligor as a result of Administrative Agent's honoring of any requests,
execution of instructions, authorizations or agreements or reliance on any
reports communicated to Administrative Agent telephonically or electronically
and purporting to have been sent to Administrative Agent by Borrower and
Administrative Agent shall have no duty to verify the origin of any such
communication or the authority of the person sending it.
4.06. Non-Receipt of Funds by Administrative Agent. Unless
--------------------------------------------
Administrative Agent shall have received written notice from a Lender or
Borrower (the "Payor") prior to the date on which the Payor is to make payment
-----
to Administrative Agent of (in the case of a Lender) the proceeds of a Loan to
be made by such Lender hereunder or a payment to Administrative Agent for the
account of
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one or more of the Lenders hereunder (each such payment being herein called a
"Required Payment"), which notice shall be effective upon receipt, that the
----------------
Payor does not intend to make the Required Payment to Administrative Agent,
Administrative Agent may assume that the Required Payment has been made and may,
in reliance upon such assumption (but shall not be required to), make the amount
thereof available to the intended recipient(s) on such date; and, if the Payor
has not in fact made the Required Payment to Administrative Agent, the
recipient(s) of such payment shall, on demand, repay to Administrative Agent the
amount so made available together with interest thereon in respect of each day
during the period commencing on the date (the "Advance Date") such amount was so
------------
made available by Administrative Agent until the date Administrative Agent
recovers such amount at a rate per annum equal to the Federal Funds Rate for
---------
such day and, if such recipient(s) shall fail promptly to make such payment,
Administrative Agent shall be entitled to recover such amount, on demand, from
the Payor, together with interest as aforesaid; provided, however, that if
-------- -------
neither the recipient(s) nor the Payor shall return the Required Payment to
Administrative Agent within three Business Days of the date such demand was
made, then, retroactively to the Advance Date, the Payor and the recipient(s)
shall each be obligated to pay interest on the Required Payment as follows
(without double recovery):
(i) if the Required Payment shall represent a payment to be made by
Borrower to the Lenders, Borrower and the recipient(s) shall each be
obligated retroactively to the Advance Date to pay interest in respect of
the Required Payment at the rate set forth in Section 3.02(b) (without
duplication of the obligation of Borrower under Section 3.02 to pay
interest on the Required Payment at the rate set forth in Section 3.02(b)),
it being understood that the return by the recipient(s) of the Required
Payment to Administrative Agent shall not limit such obligation of Borrower
under Section 3.02 to pay interest at the rate set forth in Section 3.02(b)
in respect of the Required Payment; and
(ii) if the Required Payment shall represent proceeds of a Loan to
be made by the Lenders to Borrower, the Payor, or Borrower, shall each be
obligated retroactively to the Advance Date to pay interest in respect of
the Required Payment pursuant to Section 3.02, it being understood that the
return by Borrower of the Required Payment to Administrative Agent shall
not limit any claim Borrower may have against the Payor in respect of such
Required Payment.
4.07. Right of Setoff; Sharing of Payments; Etc. (a) If any Event of
-----------------------------------------
Default shall have occurred and be continuing, each Obligor agrees that, in
addition to (and without limitation of) any right of setoff, banker's lien or
counterclaim a Lender may otherwise have, each Lender shall be entitled, at its
option (to the fullest extent permitted by law), to set off and apply any
deposit (general or special, time or demand, provisional or final), or other
indebtedness, held by it, or by any of its Affiliates, for the credit or account
of such Obligor at any of its offices, in Dollars or in any other currency,
against any principal of or interest on any of such Lender's Loans,
Reimbursement Obligations or any other amount payable to such Lender hereunder
that is not paid when due (regardless of whether such deposit or other
indebtedness is then due to such Obligor), in which case it shall promptly
notify such Obligor and Administrative Agent thereof; provided, however, that
-------- -------
such Lender's failure to give such notice shall not affect the validity thereof.
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(b) Each of the Lenders agrees that, if it should receive (other than
pursuant to Section 5 or Administrative Agent's Fee Letter) any amount hereunder
(whether by voluntary payment, by realization upon security, by the exercise of
a right of setoff or banker's lien, by counterclaim or cross action, by the
enforcement of any right under the Credit Documents, or otherwise) which is
applicable to the payment of the principal of, or interest on, the Loans,
Reimbursement Obligations or fees, the sum of which with respect to the related
sum or sums received by other Lenders is in a greater proportion than the total
of such amounts then owed and due to such Lender bears to the total of such
amounts then owed and due to all of the Lenders immediately prior to such
receipt, then such Lender receiving such excess payment shall purchase for cash
without recourse or warranty from the other Lenders an interest in the
Obligations of the respective Obligor to such Lenders in such amount as shall
result in a proportional participation by all of the Lenders in such amount;
provided, however, that if all or any portion of such excess amount is
-------- -------
thereafter recovered from such Lender, such purchase shall be rescinded and the
purchase price restored to the extent of such recovery, but without interest.
Borrower consents to the foregoing arrangements.
(c) Borrower agrees, to the fullest extent permitted under applicable
law, that any Lender so purchasing such a participation may exercise all rights
of setoff, banker's lien, counterclaim or similar rights with respect to such
participation as fully as if such Lender were a direct holder of Loans or other
amounts (as the case may be) owing to such Lender in the amount of such
participation.
(d) Nothing contained herein shall require any Lender to exercise any
such right or shall affect the right of any Lender to exercise, and retain the
benefits of exercising, any such right with respect to any other Indebtedness or
obligation of any Obligor. If, under any applicable bankruptcy, insolvency or
other similar law, any Lender receives a secured claim in lieu of a setoff to
which this Section 4.07 applies, such Lender shall, to the extent practicable,
exercise its rights in respect of such secured claim in a manner consistent with
the rights of the Lenders entitled under this Section 4.07 to share in the
benefits of any recovery on such secured claim.
Section 5. Yield Protection, Etc.
---------------------
5.01. Additional Costs. (a) If the adoption of, or any change in,
----------------
in each case after (i) in the case of any Original Lender, the date hereof or
(ii) in the case of any other Lender, the date upon which it shall have become a
Lender hereunder, any Requirement of Law or in the interpretation or application
thereof or compliance by any Lender with any request or directive (whether or
not having the force of law) from any central bank or other Governmental
Authority or the NAIC made subsequent to the date hereof:
(i) shall impose, modify or hold applicable any reserve, special
deposit, compulsory loan or similar requirement against assets held by,
deposits or other liabilities in or for the account of, advances, loans or
other extensions of credit by, or any other acquisition of funds by, any
office of such Lender or L/C Lender which is not otherwise included in the
determination of the LIBO Rate hereunder; or
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(ii) shall impose on such Lender or L/C Lender any other condition
(excluding taxes);
and the result of any of the foregoing is to increase the cost to such Lender or
L/C Lender, by an amount which such Lender or L/C Lender deems to be material
(and it is the policy of such Lender or L/C Lender to seek reimbursement from a
borrower for such amount), of making, converting into, continuing or maintaining
LIBOR Loans or issuing or participating in Letters of Credit or to reduce any
amount receivable hereunder in respect thereof then, in any such case, Borrower
shall, within 15 days of written demand therefor, pay such Lender or L/C Lender
any additional amounts necessary to compensate such Lender or L/C Lender on a
net after-tax basis (taking into account any additional tax costs or tax
benefits) for such increased cost or reduced amount receivable. If any Lender
or L/C Lender becomes entitled to claim any additional amounts pursuant to this
subsection, it shall promptly notify Borrower, through Administrative Agent, of
the event by reason of which it has become so entitled and Borrower shall not be
required to make any payments to any Lender or L/C Lender under this Section
5.01(a) in respect of any period or portion thereof more than 120 days prior to
its receipt of notice thereof from such Lender or L/C Lender. A certificate as
to any additional amounts setting forth the calculation of such additional
amounts pursuant to this Section 5.01 submitted by such Lender or L/C Lender,
through Administrative Agent, to Borrower shall be conclusive in the absence of
clearly demonstrable error. Without limiting the survival of any other
provisions hereof, this Section 5.01 shall survive the termination of this
Agreement and the payment of the Notes and all other Obligations payable
hereunder.
(b) In the event that any Lender or L/C Lender shall have determined
that the adoption, after (i) in the case of any Original Lender, the date hereof
or (ii) in the case of any other Lender, the date upon which it shall have
become a Lender hereunder of any law, rule, regulation or guideline regarding
capital adequacy (or any change after the date hereof therein or in the
interpretation or application thereof) or compliance by any Lender or L/C Lender
or any corporation controlling such Lender or L/C Lender with any request or
directive regarding capital adequacy (whether or not having the force of law)
from any central bank or other Governmental Authority or the NAIC, in each case,
made subsequent to (i) in the case of any Original Lender, the date hereof or
(ii) in the case of any other Lender, the date upon which it shall have become a
Lender hereunder, including, without limitation, the issuance, after (i) in the
case of any Original Lender, the date hereof or (ii) in the case of any other
Lender, the date upon which it shall have become a Lender hereunder, of any
final rule, regulation or guideline, does or shall have the effect of reducing
the rate of return on such Lender's or L/C Lender's, or such corporation's
capital, as a consequence of its obligations hereunder or under any Letter of
Credit to a level below that which such Lender or L/C Lender or such
corporation, could have achieved but for such adoption, change or compliance
(taking into consideration such Lender's or L/C Lender's or such corporation's
policies with respect to capital adequacy) by an amount deemed by such Lender or
L/C Lender to be material (and it is the policy of such Lender or L/C Lender to
seek reimbursement from a borrower for such amounts), then from time to time,
after submission by such Lender or L/C Lender to Borrower (with a copy to
Administrative Agent) of a written request therefor, setting forth in reasonable
detail the additional amount or amounts requested, the reason or reasons
therefor and the computation thereof, Borrower shall, within 15 days of its
receipt of such request, promptly pay to such Lender or L/C Lender such
additional amount or amounts as will compensate such Lender or L/C Lender for
such reduction; provided that Borrower shall not be
--------
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required to make any payments to any Lender or L/C Lender under this Section
5.01(b) in respect of any period or portion thereof more than 90 days prior to
its receipt of a request therefor from such Lender or L/C Lender.
5.02. Inability To Determine Interest Rate. If prior to the first
------------------------------------
day of any Interest Period: (a) Administrative Agent shall have determined
(which determination shall be conclusive and binding upon Borrower) that, by
reason of circumstances affecting the relevant market, adequate and reasonable
means do not exist for ascertaining the LIBOR Base Rate for such Interest
Period, or (b) Administrative Agent shall have received notice from Majority
Lenders that the LIBOR Base Rate determined or to be determined for such
Interest Period will not adequately and fairly reflect the cost to such Lenders
(or any affiliate of any such Lender from which such Lender customarily obtains
funds) (as conclusively certified by such Lenders) of making or maintaining
their affected Loans during such Interest Period, Administrative Agent shall
give telecopy or telephonic notice thereof to Borrower and the Lenders as soon
as practicable thereafter. If such notice is given (x) any LIBOR Loans
requested to be made on the first day of such Interest Period shall be made as
ABR Loans, (y) any Loans that were to have been Converted on the first day of
such Interest Period to LIBOR Loans shall be Continued as ABR Loans and (z) any
outstanding LIBOR Loans that were to have been Continued as such for such
Interest Period shall be Converted, on the first day of such Interest Period, to
ABR Loans. Until such notice has been withdrawn by Administrative Agent, no
further LIBOR Loans shall be made or Continued as such, nor shall Borrower have
the right to Convert Loans to, LIBOR Loans.
5.03. Illegality. Notwithstanding any other provision of this
----------
Agreement, in the event that any change (i) in the case of any Original Lender,
after the date hereof or (ii) in the case of any other Lender, the date upon
which it shall have become a Lender hereunder in any Requirement of Law or in
the interpretation or application thereof shall make it unlawful for any Lender
or L/C Lender or its Applicable Lending Office to honor its obligation to make
or maintain LIBOR Loans or issue Letters of Credit hereunder (and, in the sole
opinion of such Lender or L/C Lender, the designation of a different Applicable
Lending Office would either not avoid such unlawfulness or would be
disadvantageous to such Lender or L/C Lender), then such Lender or L/C Lender
shall promptly notify Borrower thereof (with a copy to Administrative Agent) and
such Lender's or L/C Lender's obligation to make or Continue, or to Convert
Loans of any other Type into, LIBOR Loans or issue Letters of Credit shall be
suspended until such time as such Lender or L/C Lender may again make and
maintain LIBOR Loans or issue Letters of Credit (in which case the provisions of
Section 5.04 shall be applicable).
5.04. Treatment of Affected Loans. If the obligation of any Lender
---------------------------
to make LIBOR Loans or to Continue, or to Convert ABR Loans into, LIBOR Loans
shall be suspended pursuant to Section 5.03, such Lender's LIBOR Loans shall be
automatically Converted into ABR Loans on the last day(s) of the then current
Interest Period(s) for such LIBOR Loans (or on such earlier date as such Lender
may specify to Borrower with a copy to Administrative Agent as is required by
law) and, unless and until such Lender gives notice as provided below that the
circumstances specified in Section 5.03 which gave rise to such Conversion no
longer exist:
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(i) to the extent that such Lender's LIBOR Loans have been so
Converted, all payments and prepayments of principal which would otherwise
be applied to such Lender's LIBOR Loans shall be applied instead to its ABR
Loans; and
(ii) all Loans which would otherwise be made or Continued by such
Lender as LIBOR Loans shall be made or Continued instead as ABR Loans and
all ABR Loans of such Lender which would otherwise be Converted into LIBOR
Loans shall remain as ABR Loans, interest on which shall, in each case, be
paid on the dates upon which interest is payable on the corresponding LIBOR
Loans of the other Lenders.
If such Lender gives notice to Borrower with a copy to Administrative Agent that
the circumstances specified in Section 5.03 which gave rise to the Conversion of
such Lender's LIBOR Loans pursuant to this Section 5.04 no longer exist (which
such Lender agrees to do promptly upon such circumstances ceasing to exist) at a
time when LIBOR Loans are outstanding, such Lender's ABR Loans shall be
automatically Converted, on the first day(s) of the next succeeding Interest
Period(s) for such outstanding LIBOR Loans, to the extent necessary so that,
after giving effect thereto, all Loans held by the Lenders holding LIBOR Loans
and by such Lender are held pro rata (as to principal amounts, Types and
--------
Interest Periods) in accordance with their respective Commitments.
5.05. Compensation. (a) Borrower agrees to indemnify each Lender
------------
and to hold each Lender harmless from any loss or expense which such Lender may
sustain or incur as a consequence of (1) default by Borrower in payment when due
of the principal amount of or interest on any LIBOR Loan, (2) default by
Borrower in making a borrowing of, Conversion into or Continuation of LIBOR
Loans after Borrower has given a notice requesting the same in accordance with
the provisions of this Agreement, (3) default by Borrower in making any
prepayment of any LIBOR Loans after Borrower has given a notice thereof in
accordance with the provisions of this Agreement, or (4) the Conversion or the
making of a payment or a prepayment of LIBOR Loans on a day which is not the
last day of an Interest Period with respect thereto, including in each case, any
such loss (excluding loss of margin) or expense arising from the deployment of
funds obtained by it or from fees payable to terminate the deposits from which
such funds were obtained.
(b) For the purpose of calculation of all amounts payable to a Lender
under this Section 5.05 each Lender shall be deemed to have actually funded its
relevant LIBOR Loan through the purchase of a deposit bearing interest at the
LIBO Rate in an amount equal to the amount of such LIBOR Loan and having a
maturity comparable to the relevant Interest Period; provided, however, that
-------- -------
each Lender may fund each of its LIBOR Loans in any manner it sees fit, and the
foregoing assumption shall be utilized only for the calculation of amounts
payable under this subsection. Any Lender requesting compensation pursuant to
this Section 5.05 will furnish to Administrative Agent and Borrower a
certificate setting forth in reasonable detail the basis for such request, the
amount requested and the calculation thereof, and such certificate, absent
manifest error, shall be conclusive. Without limiting the survival of any other
provision hereof, this Section 5.05 shall survive the termination of this
Agreement and the payment of the Notes and all other amounts payable hereunder.
5.06. Net Payments. (a) Except as provided in Section 5.06(b),
------------
all payments made by any Obligor hereunder or under any Note or any Guarantee
will be made without setoff, counter-
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claim or other defense. Except as provided in Section 5.06(b), all such payments
will be made free and clear of, and without deduction or withholding for, any
present or future Taxes now or hereafter imposed by any Governmental Authority
or by any political subdivision or taxing authority thereof or therein with
respect to such payments (but excluding any Excluded Tax) and all interest,
penalties or similar liabilities with respect thereto (all such Taxes (other
than Excluded Taxes) being referred to collectively as "Covered Taxes"). If any
-------------
Covered Taxes are so levied or imposed, each Obligor agrees on a joint and
basis to pay the full amount of such Covered Taxes, and such additional
amounts as may be necessary so that every payment of all amounts due under this
Agreement, the Guarantees or under any Note, after withholding or deduction for
or on account of any Covered Taxes, will not be less than the amount provided
for herein or in such Note. Each Obligor will furnish to Administrative Agent
within 45 days after the date the payment of any Covered Taxes is due pursuant
to applicable law certified copies of tax receipts or other documentation
reasonably satisfactory to such Lender evidencing such payment by such Obligor.
The Obligors agree to jointly and severally indemnify and hold harmless each
Lender, and reimburse such Lender upon its written request, for the amount of
any Covered Taxes so levied or imposed and paid by such Lender and any liability
(including penalties, additions to tax, interest and expenses) arising therefrom
or with respect thereto.
"Excluded Taxes" shall mean any Tax (other than any Other Taxes) (i)
--------------
imposed on or measured by the income or profits of a Lender pursuant to the laws
of the jurisdiction in which it is organized or the jurisdiction in which the
principal office or Applicable Lending Office of such Lender is located or any
jurisdiction in which such Lender conducts business or any subdivision thereof,
(ii) imposed on any Lender in the nature of franchise taxes or other similar
taxes imposed as a result of such Lender doing business in a particular
jurisdiction, or (iii) imposed by reason of any present or former connection
between a Lender and the jurisdiction imposing such Taxes, other than solely as
a result of this Agreement or any Note or transaction contemplated hereby.
(b) Each Lender that is not a United States person (as such term is
defined in Section 7701(a)(30) of the Code) (a "Non-U.S. Lender") agrees to
---------------
deliver to Borrower and Administrative Agent on or prior to the Effective Date
or, in the case of a Lender that is an assignee or transferee of an interest
under this Agreement pursuant to Section 12.05 (unless the assignee or
transferee Lender was already a Lender hereunder immediately prior to such
assignment or transfer and was in compliance with this Section 5.06(b) as of the
date of such assignment or transfer), on the date of such assignment or transfer
to such Lender, (i) two accurate and complete original signed copies of Internal
Revenue Service Form W-8ECI or W-8BEN (certifying that the Lender is entitled to
the benefits of an income tax treaty) (or successor forms) certifying to such
Lender's entitlement to a complete exemption from United States withholding tax
with respect to payments to be made under this Agreement and under any Note or
any Guarantee (or, with respect to any assignee Lender, at least as extensive as
the assigning Lender), or (ii) if the Lender is not a "bank" within the meaning
of Section 881(c)(3)(A) of the Code and cannot deliver either Internal Revenue
Service Form W-8ECI or W-8BEN (certifying that the Lender is entitled to the
benefits of an income tax treaty) pursuant to clause (i) above, (x) a
certificate substantially in the form of Exhibit J (any such certificate, a
---------
"Foreign Lender Certificate") and (y) two accurate and complete original signed
--------------------------
copies of Internal Revenue Service Form W-8BEN (or successor form) certifying to
such Lender's entitlement to a complete exemption from United States withholding
tax with respect to payments to be made under this Agreement and under any Note
(or, with respect to any assignee Lender, at least as extensive as the
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assigning Lender). In addition, each Lender agrees that from time to time after
the Closing Date, when a lapse in time or change in circumstances renders the
previous certification obsolete or inaccurate in any material respect when the
previous certification expires due to the passage of time, it will deliver to
Borrower and Administrative Agent two new accurate and complete original signed
copies of Internal Revenue Service Form W-8ECI or W-8BEN (certifying that the
Lender is entitled to the benefits of an income tax treaty), or Form W-8BEN and
a Foreign Lender Certificate, as the case may be, and such other forms as may be
required in order to confirm or establish the entitlement of such Lender to a
continued exemption from or (if continued exemption becomes unavailable)
reduction in United States withholding tax with respect to payments under this
Agreement and any Note or any Guarantee, or it shall immediately notify Borrower
and Administrative Agent of its inability to deliver any such Form or
Certificate, in which case such Lender shall not be required to deliver any such
form or certificate pursuant to this Section 5.06(b) for so long as such
payments may be made free from United States withholding tax. Notwithstanding
the foregoing, no Lender shall be required to deliver any such form or
certificate pursuant to the immediately preceding sentence if a change in
treaty, law or regulation has occurred prior to the date on which such delivery
would otherwise be required that renders any such form or certificate
inapplicable or would prevent the Lender from duly completing and delivering any
such form or certificate with respect to it and such Lender so advises Borrower.
No Obligor shall be required to indemnify any Non-U.S. Lender, or to pay any
additional amounts to any Non-U.S. Lender, in respect of any Covered Taxes to
the extent that the obligation to pay such Covered Taxes would not have arisen
but for a failure by such Non-U.S. Lender to comply with the provisions of this
Section 5.06(b). Notwithstanding anything to the contrary contained in this
Section 5.06, Borrower agrees to pay additional amounts and to indemnify each
Lender in the manner set forth in Section 5.06(a) (without regard to the
identity of the jurisdiction requiring the deduction or withholding) in respect
of any amounts deducted or withheld by it as described in the immediately
preceding sentence as a result of any changes after (i) in the case of any
Original Lenders, the Effective Date and (ii) in the case of any other Lender,
the date upon which it shall have become a Lender hereunder, in any applicable
law, treaty, governmental rule, regulation, guideline or order, or in the
interpretation thereof, relating to the deducting or withholding of Covered
Taxes.
(c) In addition, Borrower agrees to pay any present or future stamp
or documentary taxes or any other excise or property taxes, charges or similar
levies which arise from any payment made hereunder or under the Notes or from
the execution, delivery, filing, recordation or registration of, or otherwise
with respect to, this Agreement or the Notes (hereinafter referred to as "Other
-----
Taxes").
-----
(d) Any Lender claiming any additional amounts payable pursuant to
this Section 5.06 agrees to use (at the Obligors' expense) reasonable efforts
(consistent with its internal policy and legal and regulatory restrictions) to
change the jurisdiction of its Applicable Lending Office if the making of such
change would avoid the need for, or in the opinion of such Lender materially
reduce the amount of, any such additional amounts that may thereafter accrue and
would not, in the sole judgment of such Lender exercised in good faith, be
otherwise disadvantageous to such Lender.
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Section 6. Guarantee.
---------
6.01. The Guarantee. Subject to Section 6.07, each Guarantor hereby
-------------
jointly and severally guarantees as a primary obligor and not as a surety to
each Creditor and its successors and assigns the prompt payment in full when due
(whether at stated maturity, by acceleration or otherwise) of the principal of
and interest (including any interest, fees, costs or charges that would accrue
but for the provisions of the Bankruptcy Code after any bankruptcy or insolvency
petition under the Bankruptcy Code) on the Loans made by the Lenders to, and the
Notes held by each Lender of, Borrower, and all other Obligations from time to
time owing to the Creditors by Borrower under any Credit Document or Swap
Contract relating to the Loans, in each case strictly in accordance with the
terms thereof (such obligations being herein collectively called the "Guaranteed
----------
Obligations"). The Guarantors hereby jointly and severally agree that if
-----------
Borrower shall fail to pay in full when due (whether at stated maturity, by
acceleration or otherwise) any of the Guaranteed Obligations, the Guarantors
will promptly pay the same, without any demand or notice whatsoever, and that in
the case of any extension of time of payment or renewal of any of the Guaranteed
Obligations, the same will be promptly paid in full when due (whether at
extended maturity, by acceleration or otherwise) in accordance with the terms of
such extension or renewal.
6.02. Obligations Unconditional. The obligations of the Guarantors
-------------------------
under Section 6.01 shall constitute guaranties of payment and are irrevocable
and unconditional, joint and several and, to the fullest extent permitted by
applicable law, absolute, irrespective of the value, genuineness, validity,
regularity or enforceability of the Guaranteed Obligations of Borrower under
this Agreement, the Notes or any other agreement or instrument referred to
herein or therein, or any substitution, release or exchange of any other
guarantee of or security for any of the Guaranteed Obligations, and, to the
fullest extent permitted by applicable law, irrespective of any other
circumstance whatsoever that might otherwise constitute a legal or equitable
discharge or defense of a surety or guarantor (except for payment in full).
Without limiting the generality of the foregoing, it is agreed that the
occurrence of any one or more of the following shall not alter or impair the
liability of the Guarantors hereunder, which shall remain absolute, irrevocable
and unconditional under any and all circumstances as, and to the extent,
described above:
(i) at any time or from time to time, without notice to the
Guarantors, the time for any performance of or compliance with any of the
Guaranteed Obligations shall be extended, or such performance or compliance
shall be waived;
(ii) any of the acts mentioned in any of the provisions of this
Agreement or the Notes or any other agreement or instrument referred to
herein or therein shall be done or omitted (other than payment in full of
the Obligations);
(iii) the maturity of any of the Guaranteed Obligations shall be
accelerated, or any of the Guaranteed Obligations shall be amended in any
respect, or any right under the Credit Documents or any other agreement or
instrument referred to herein or therein shall be amended or waived in any
respect or any other guarantee of any of the Guaranteed Obligations or any
security therefor shall be released or exchanged in whole or in part or
otherwise dealt with;
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(iv) any lien or security interest granted to, or in favor of, L/C
Lender or any Lender or Agent as security for any of the Guaranteed
Obligations shall fail to be perfected; or
(v) the release of any other Guarantor.
The Guarantors hereby expressly waive diligence, presentment, demand
of payment, protest and all notices whatsoever, and any requirement that any
Creditor exhaust any right, power or remedy or proceed against Borrower under
this Agreement or the Notes or any other agreement or instrument referred to
herein or therein, or against any other Person under any other guarantee of, or
security for, any of the Guaranteed Obligations. The Guarantors waive any and
all notice of the creation, renewal, extension, waiver, termination or accrual
of any of the Guaranteed Obligations and notice of or proof of reliance by any
Creditor upon this guarantee or acceptance of this guarantee, and the Guaranteed
Obligations, and any of them, shall conclusively be deemed to have been created,
contracted or incurred in reliance upon this guarantee, and all dealings between
Borrower and the Creditors shall likewise be conclusively presumed to have been
had or consummated in reliance upon this guarantee. This guarantee shall be
construed without regard to any right of offset with respect to the Guaranteed
Obligations at any time or from time to time held by the Creditors. This
guarantee shall remain in full force and effect and be binding in accordance
with and to the extent of its terms upon the Guarantors and the successors and
assigns thereof, and shall inure to the benefit of the Creditors, and their
respective successors and assigns, notwithstanding that from time to time during
the term of this Agreement there may be no Guaranteed Obligations outstanding.
6.03. Reinstatement. The obligations of the Guarantors under this
-------------
Section 6 shall be automatically reinstated if and to the extent that for any
reason any payment by or on behalf of Borrower or other Obligor in respect of
the Guaranteed Obligations is rescinded or must be otherwise restored by any
holder of any of the Guaranteed Obligations, whether as a result of any
proceedings in bankruptcy or reorganization or otherwise. The Guarantors
jointly and severally agree that they will indemnify each Creditor on demand for
all reasonable costs and expenses (including reasonable fees of counsel)
incurred by such Creditor in connection with such rescission or restoration,
including any such costs and expenses incurred in defending against any claim
alleging that such payment constituted a preference, fraudulent transfer or
similar payment under any bankruptcy, insolvency or similar law, other than any
costs or expenses resulting from the gross negligence or bad faith of such
Creditor.
6.04. Subrogation; Subordination. Each Guarantor hereby agrees
--------------------------
that until the indefeasible payment and satisfaction in full in cash of all
Guaranteed Obligations and the expiration and termination of the Commitments of
the Lenders under this Agreement it shall not exercise any right or remedy
arising by reason of any performance by it of its guarantee in this Section,
whether by subrogation or otherwise, against Borrower or any other Guarantor of
any of the Guaranteed Obligations or any security for any of the Guaranteed
Obligations. The payment of any amounts due with respect to any indebtedness of
Borrower or any other Guarantor now or hereafter owing to any Guarantor or
Borrower by reason of any payment by such Guarantor under the Guarantee in this
Section 6 is hereby subordinated to the prior indefeasible payment in full in
cash of the Guaranteed Obligations. Each Guarantor agrees that it will not
demand, xxx for or otherwise attempt to collect any such indebtedness of
Borrower to such Guarantor until the Obligations shall have been indefeasibly
paid in full in
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cash. If, notwithstanding the foregoing sentence, any Guarantor shall prior to
the indefeasible payment in full in cash of the Guaranteed Obligations collect,
enforce or receive any amounts in respect of any such right or remedy, such
amounts shall be collected, enforced and received by such Guarantor as trustee
for Creditors and be paid over to Administrative Agent on account of the
Guaranteed Obligations without affecting in any manner the liability of such
Guarantor under the other provisions of the guaranty contained herein.
6.05. Remedies. The Guarantors jointly and severally agree that, as
--------
between the Guarantors and the Lenders, the obligations of Borrower under this
Agreement and the Notes may be declared to be forthwith due and payable as
provided in Section 10 (and shall be deemed to have become automatically due and
payable in the circumstances provided in said Section 10) for purposes of
Section 6.01, notwithstanding any stay, injunction or other prohibition
preventing such declaration (or such obligations from becoming automatically due
and payable) as against Borrower and that, in the event of such declaration (or
such obligations being deemed to have become automatically due and payable),
such obligations (whether or not due and payable by Borrower) shall forthwith
become due and payable by the Guarantors for purposes of Section 6.01.
6.06. Continuing Guarantee. The guarantee in this Section 6 is a
--------------------
continuing guarantee of payment, and shall apply to all Guaranteed Obligations
whenever arising.
6.07. General Limitation on Guarantee Obligations. In any action or
-------------------------------------------
proceeding involving any state corporate law, or any state, Federal or foreign
bankruptcy, insolvency, reorganization or other law affecting the rights of
creditors generally, if the obligations of any Guarantor under Section 6.01
would otherwise be held or determined to be void, voidable, invalid or
unenforceable, or subordinated to the claims of any other creditors, on account
of the amount of its liability under Section 6.01, then, notwithstanding any
other provision to the contrary, the amount of such liability shall, without any
further action by such Guarantor, any Creditor or any other Person, be
automatically limited and reduced to the highest amount that is valid and
enforceable and not subordinated to the claims of other creditors as determined
in such action or proceeding.
Section 7. Conditions Precedent.
--------------------
7.01. Conditions to Effectiveness. The effectiveness of this
---------------------------
Agreement is subject to the satisfaction of the following conditions precedent
(the date of the satisfaction (or waiver) of each of the following conditions,
the "Effective Date"):
--------------
(i) Documentation and Evidence of Certain Matters. The Lead
---------------------------------------------
Arranger and the Administrative Agent shall have received the following
documents (with sufficient conformed copies for each Lender), each of which
shall be reasonably satisfactory to the Lead Arranger and the
Administrative Agent in form and substance:
(1) Corporate Documents. Certified true and complete copies
-------------------
of the charter and by-laws and all amendments thereto (or equivalent
documents) of each Obligor and of all corporate authority for each
Obligor (including board of director resolutions and evidence of the
incumbency of officers) with respect to the execution,
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delivery and performance of such of the Credit Documents to which such
Obligor is intended to be a party and each other document to be
delivered by such Obligor from time to time in connection herewith and
the extensions of credit hereunder and the consummation of the
Transactions, certified as of the Effective Date as complete and
correct copies thereof by the Secretary or an Assistant Secretary of
such Obligor, and
(2) The Credit Agreement. This Agreement, (i) executed and
--------------------
delivered by a duly authorized officer of each Obligor, and (ii)
executed and delivered by a duly authorized officer of each Lender and
Agent (or, in each case, evidence reasonably satisfactory to the Lead
Arranger and the Administrative Agent of the execution of this
Agreement by such Obligor, Lender or Agent).
7.02. Conditions to Initial Extension of Credit. The obligation of
-----------------------------------------
the Lenders to make any initial extension of credit hereunder (whether by making
a Loan or issuing a Letter of Credit) is subject to the satisfaction of the
condition precedent that the Effective Date shall have occurred (or shall occur
simultaneously therewith) and to the satisfaction of the following additional
conditions precedent (the date of the satisfaction (or waiver) of all of the
conditions to the initial extension of credit in this Section 7.02, the "Closing
-------
Date"):
----
(i) Documentation and Evidence of Certain Matters. The Lead
---------------------------------------------
Arranger and the Administrative Agent shall have received the following
documents (with sufficient conformed copies for each Lender), each duly
executed where appropriate (or, in each case, the Lead Arranger shall have
received evidence reasonably satisfactory to it of the execution thereof by
the parties thereto) and each of which (other than any such document the
form of which is specified in an Exhibit hereto) shall be reasonably
satisfactory to the Lead Arranger and the Administrative Agent in form and
substance:
(1) Officers' Certificate. An Officers' Certificate of Borrower,
---------------------
dated the Closing Date, (x) to the effect set forth in clauses (a) and
(b) of Section 7.03(i) and (y) to the effect that all conditions
precedent to the making of such initial extension of credit have been
satisfied or waived (other than any condition requiring the
satisfaction or reasonable satisfaction of any Agent, L/C Lender or
Lender).
(2) Opinions of Counsel. An opinion of Xxxxx Xxxx & Xxxxxxxx,
-------------------
counsel to the Obligors, substantially in the form of Exhibit E-1, and
-----------
an opinion of each local counsel listed on Schedule 7.02(i)(2),
-------------------
substantially in the form of Exhibit E-2.
-----------
(3) Notes. The Notes, duly completed and executed for each Lender
-----
that has requested Notes at least one Business Day prior to the
Closing Date.
(4) Security Documents. The Security Agreement, such other pledge
------------------
agreements required under local law in the judgment of counsel to
Administrative Agent and requested reasonably in advance of the
intended Closing Date (each of which shall be in full force and
effect), the Perfection Certificate, substantially in the form of
Exhibit M, duly authorized, executed and delivered by the Obligors and
---------
Ad-
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ministrative Agent, the certificates identified under the name of such
Obligors in Schedule 1.1(c) and Schedule 1.1(d) to the Security
Agreement, accompanied by undated stock powers, instruments of
assignment or issuer acknowledgments executed in blank if applicable
and the notes identified under the name of such Obligors in Schedule
1.1(e) to the Security Agreement, accompanied by undated notations or
instruments of assignment executed in blank.
(5) Solvency Certificate. A certificate in the form of
--------------------
Exhibit C-2 from the chief financial officer of Borrower with respect
-----------
to the Solvency (on a consolidated basis) of Borrower immediately
after the consummation of the Transactions to occur on the Closing
Date.
(ii) Borrowing Base Certificate. Administrative Agent shall have
--------------------------
received a Borrowing Base Certificate prepared (on a pro forma basis as if
--- -----
the Transactions had been consummated on such date) as of the last Business
Day of the most recent month ended at least 30 days prior to the Closing
Date.
(iii) No Other Debt or Preferred Stock. After giving effect to the
--------------------------------
Transactions and the other transactions contemplated hereby, Borrower and
its Subsidiaries shall have outstanding no Indebtedness or preferred stock
(or direct or indirect guarantee or other credit support in respect
thereof) outstanding other than the Loans and Indebtedness and Contingent
obligations permitted under Section 9.08.
(iv) Consummation of Transactions. Each of the Transactions (other
----------------------------
than the extensions of credit hereunder and the Spin-Off) shall have been
(or shall be contemporaneously) consummated in all material respects in
accordance with the terms hereof and the terms of documentation therefor
(without the material waiver or material amendment of any material
condition unless consented to by the Lead Arranger, the Administrative
Agent and the Lenders) that are in form and substance reasonably
satisfactory to the Lead Arranger (with any material condition therein
requiring the satisfaction or consent of any Person other than the Lead
Arranger or the Lenders being deemed to require the reasonable satisfaction
or consent of the Lead Arranger and the Lenders).
(v) No Material Adverse Change. There shall not have occurred or
--------------------------
become known any material adverse change in the business, results of
operations, financial condition or prospects of the Companies taken as a
whole (and after giving effect to the Transactions) since June 30, 2001.
(vi) Approvals. All requisite material Governmental Authorities
---------
and, except to the extent that the absence thereof could not reasonably be
expected to result in a Material Adverse Change, third parties have
approved or consented to the Transactions and the other transactions
contemplated hereby to the extent required (without the imposition of any
materially burdensome or materially adverse conditions or requirements in
the reasonable judgment of the Lead Arranger), all such approvals are in
full force and effect, all applicable waiting periods have expired and
there shall be no Proceeding, actual or threatened, that has or
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could have a reasonable likelihood of restraining, preventing or imposing
materially burdensome conditions on any of the Transactions or the other
transactions contemplated hereby.
(vii) Payment of Fees and Expenses. All accrued and unpaid fees
----------------------------
and expenses (including the fees and expenses of Xxxxxx Xxxxxx & Xxxxxxx
and of local counsel to the Lead Arranger) of the Lenders, Administrative
Agent and the Lead Arranger in connection with the Credit Documents, to the
extent invoiced at least two Business Days prior to the Closing Date, shall
have been paid.
(viii) No Legal Bar. No Law shall be applicable that restrains,
------------
prevents or imposes material adverse conditions upon any component of the
Transactions or the financing thereof, including the Credit Facilities.
(ix) Filings and Lien Searches. The Obligors shall have authorized,
-------------------------
executed and delivered each of the following:
(1) UCC Financing Statements (Form UCC-1) in appropriate form
for filing under the UCC and any other applicable law, rule or
regulation in each jurisdiction as may be necessary or appropriate to
perfect the Liens created, or purported to be created, by the Security
Documents;
(2) to the extent requested by the Lead Arranger, certified
copies of Requests for Information (Form UCC-11), tax lien and
judgment lien searches or equivalent reports or lien search reports,
each of a recent date listing all effective financing statements, lien
notices or comparable documents that name any Obligor as debtor and
that are filed in those states and other jurisdictions in which any of
the Collateral of such Obligor is located, the states and other
jurisdictions in which each such Person's principal place of business
is located and the state in which such Person is organized, none of
which will, after giving effect to the consummation of the
Transactions, encumber the Collateral covered or intended to be
covered by the Security Agreement other than those encumbrances which
constitute Prior Liens and other Liens expressly permitted by the
terms of the applicable Security Document; and
(3) evidence of arrangements for (A) the completion of all
recordings and filings of, or with respect to, the Security Documents,
and (B) the taking of all actions as may be necessary or, in the
opinion of the Lead Arranger, desirable, to perfect the Liens created,
or purported to be created, by the Security Documents.
(x) Transition Services Documents. The Lead Arranger shall be
-----------------------------
satisfied with the agreements and other arrangements (in respect of
transition services or otherwise) between Pitney Xxxxx, Inc. and/or its
Subsidiaries (other than Borrower and/or its Subsidiaries) and Borrower
and/or its Subsidiaries.
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(xi) After giving effect to such initial extension of credit,
Borrower shall thereupon have the ability to borrow not less than
$20,000,000 in the form of a Revolving Loan pursuant to this Agreement.
7.03. Conditions to Initial and Subsequent Extensions of Credit.
---------------------------------------------------------
The obligation of the Lenders to make any Loan or otherwise extend any credit to
Borrower upon the occasion of each borrowing or other extension of credit
(whether by making a Loan or issuing a Letter of Credit) hereunder (including
the initial borrowing) is subject to the further conditions precedent that:
(i) No Default or Event of Default; Representations and Warranties
--------------------------------------------------------------
True. Both immediately prior to the making of such Loan or other extension
----
of credit and also after giving pro forma effect thereto and to the
intended use thereof:
(a) no Default or Event of Default shall have occurred and be
continuing;
(b) the representations and warranties made by the Obligors in
Section 8, and by each Obligor in each of the other Credit Documents
to which it is a party, shall (x) in the case of any such
representation or warranty that expressly relates to a prior
specific date or dates, be accurate in all material respects on and
as of such date or dates and (y) in the case of any other such
representation or warranty, continue to be accurate in all material
respects on and as of the date of the making of such Loan or other
extension of credit with the same force and effect as if made on and
as of such date (except that any such representation or warranty
qualified as to materiality shall (A) in the case of any
representation or warranty referred to in clause (x) above, be
accurate on and as of the date or dates referred to therein and (B)
in the case of any other such representation or warranty, continue
to be accurate on and as of the date of the making of such Loan or
other extension of credit with the same force and effect as if made
on and as of such date); and
(c) in the case of any extension of credit consisting of the
making of Revolving Loans or Swing Loans or the issuance of any
Letter of Credit, the sum of the aggregate amount of the outstanding
Swing Loans, plus Revolving Loans, plus L/C Liabilities shall not
exceed the Borrowing Base then in effect.
(ii) Notice of Borrowing. Other than with respect to a Swing Loan,
-------------------
Administrative Agent shall have received a Notice of Borrowing duly
completed and complying with Section 4.05.
Each Notice of Borrowing or request for the issuance of a Letter of
Credit delivered by Borrower hereunder shall constitute a certification by
Borrower to the effect set forth in clauses (i) and (ii) above as of the date of
such borrowing or issuance. Each notice submitted by Borrower hereunder for an
extension of credit hereunder shall constitute a representation and warranty by
Borrower, as of the date of such notice and as of the relevant borrowing date or
date of issuance of a Letter of Credit, as applicable, that the applicable
conditions in Sections 7.02 and 7.03 (other than any condi-
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tion requiring the satisfaction or reasonable satisfaction of any Agent, Lender
or L/C Lender) have been satisfied or waived in accordance with the terms
hereof.
7.04. Determinations Under Section 7. For purposes of determining
------------------------------
compliance with the conditions specified in Sections 7.01 and 7.02, each Lender
and each Agent 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, the
Required Lenders, the Agent or such Agent unless an officer of Administrative
Agent responsible for the transactions contemplated by this Agreement shall have
received notice from such Lender or Agent prior to the date that Borrower, by
notice to the Administrative Agent, designates as the proposed date of the
initial extension of credit, specifying its objection thereto.
Section 8. Representations and Warranties. Each Obligor represents
------------------------------
and warrants to the Creditors that at and as of the Effective Date and at and as
of each Funding Date (in each case immediately before and immediately after
giving effect to the transactions to occur on such date (including (i) the
application of the proceeds of any extension of credit to be made on such
Funding Dates and (ii) with respect to the Closing Date, the Transactions)):
8.01. Corporate Existence; Compliance with Law. Each Company: (a)
----------------------------------------
is a corporation, partnership, limited liability company or other entity duly
organized, validly existing and, to the extent applicable, in good standing
under the laws of the jurisdiction of its organization; (b) has all requisite
corporate or other power and authority, and has all governmental licenses,
authorizations, consents and approvals necessary to own its Property and carry
on its business as now being conducted; (c) is qualified to do business and is,
to the extent applicable, in good standing in all jurisdictions in which the
nature of the business conducted by it makes such qualification necessary; and
(d) is in compliance with all Requirements of Law, except, in the case of
------
clauses (a), (b), (c) and (d) where the failure thereof individually or in the
aggregate would not have a Material Adverse Effect.
8.02. Financial Condition; Etc. (a) Borrower has delivered to the
------------------------
Lenders (i) the audited combined balance sheets of Consolidated Companies as of
December 31, 1999 and 2000, and the related statements of income, changes in
invested equity and cash flows for the fiscal years ended on December 31, 1998,
1999 and 2000, together with a report thereon by PricewaterhouseCoopers LLP,
certified public accountants, and (ii) the unaudited combined balance sheet of
Consolidated Companies as of June 30, 2001 and the related statements of income,
changes in invested equity and cash flows for the six months ended on such date.
All of said financial statements, including in each case the related schedules
and notes, have been prepared in accordance with GAAP consistently applied and
present fairly in all material respects the combined financial position of
Consolidated Companies as of the respective dates of said balance sheets and the
combined results of their operations for the respective periods covered thereby,
subject (in the case of interim statements) to normal period-end audit
adjustments and the omission of certain footnotes.
(b) Except as set forth in Schedule 8.02(b), in the financial
----------------
statements or other information referred to in Section 8.02(a), as of the
Effective Date, there are no material liabilities of any Company of any kind
required to be set forth on a balance sheet or in the notes thereto prepared in
accordance with GAAP, whether accrued, contingent, absolute, determined,
determinable or other-
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wise, and there is no existing condition, situation or set of circumstances
which is reasonably likely to result in such a liability.
(c) Since June 30, 2001 there has been no Material Adverse Change.
(d) The pro forma balance sheet of Consolidated Companies (the "Pro
---
Forma Balance Sheet"), certified by the chief financial officer of Borrower,
-------------------
copies of which will be furnished to each Lender not later than the second
Business Day prior to the Closing Date, is the balance sheet of Consolidated
Companies as of June 30, 2001 (the "Pro Forma Date"), adjusted to give effect
--------------
(as if such events had occurred on such date) to the Transactions to occur on
the Closing Date and the application of the proceeds of all Indebtedness to be
incurred on such date. The Pro Forma Balance Sheet, together with the notes
thereto, accurately reflects in all material respects all adjustments necessary
to give effect to the Transactions, was prepared based on good faith
assumptions, and presents fairly in all material respects on a pro forma basis
the combined financial position of Consolidated Companies as at the Pro Forma
Date, adjusted as described above.
8.03. Litigation. Except as set forth in Schedule 8.03, there is no
---------- -------------
Proceeding (other than any qui tam Proceeding, to which this Section is limited
to the best of Borrower's knowledge) pending against, or to the knowledge of
Borrower, threatened in writing against or affecting, any Company or any of its
respective Properties before any Governmental Authority or private arbitrator
that may have a reasonable likelihood of being adversely determined and that, if
determined or resolved adversely to such Company, would have a Material Adverse
Effect.
8.04. No Breach. None of the execution, delivery and performance by
---------
any Obligor of any Credit Document or Transaction Document to which it is a
party nor the consummation of the transactions herein and therein contemplated
(including the Transactions) do or will (i) conflict with or result in a breach
of, or require any consent (which has not been obtained and is in full force and
effect) under, any Organic Document of any Company or any applicable Requirement
of Law or any order, writ, injunction or decree of any Governmental Authority
binding on any Company, or tortuously interfere with, result in a breach of, or
require termination of, any term or provision of any Contractual Obligation of
any Company, (ii) constitute (with due notice or lapse of time or both) a
default under any such Contractual Obligation or (iii) result in the creation or
imposition of any Lien (except for the Liens created pursuant to the Security
Documents and Permitted Liens) upon any Property of any Company pursuant to the
terms of any such Contractual Obligation, except with respect to each of the
foregoing which would not have a Material Adverse Effect and which would not
subject any Creditor to any material risk of damages or liability to third
parties.
8.05. Action. Each Company has all necessary corporate, partnership,
------
etc. power, authority and legal right to execute, deliver and perform its
obligations under each Credit Document and Transaction Document to which it is a
party and to consummate the transactions herein and therein contemplated; the
execution, delivery and performance by each Company of each Credit Document and
Transaction Document to which it is a party and the consummation of the
transactions herein and therein contemplated have been duly authorized by all
necessary corporate, partnership, etc. action on its part; and this Agreement
has been duly and validly executed and delivered by each Obligor and
constitutes, and each of the Notes and the other Credit Documents to which it is
a party
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when executed and delivered by such Obligor (in the case of the Notes, for
value) will constitute, its valid and binding agreement (or, in the case of the
Notes, obligation), enforceable against such Obligor in accordance with its
terms, subject to (a) applicable bankruptcy, insolvency and similar laws of
general applicability from time to time in effect affecting creditors' rights
and remedies generally and (b) general principles of equity (regardless of
whether considered in a proceeding in equity or at law).
8.06. Approvals. No authorizations, approvals or consents of, and no
---------
filings or registrations with, any Governmental Authority or any securities
exchange are necessary for the execution, delivery or performance by any Company
of the Credit Documents and the Transaction Documents to which it is a party or
for the legality, validity or enforceability hereof or thereof or for the
consummation of the transactions herein and therein contemplated, except for (i)
filings and recordings in respect of the Liens created pursuant to the Security
Documents, (ii) filings required to be made with the Commission in compliance
with disclosure requirements under applicable securities laws (including the
Securities Act and the Exchange Act) and (iii) consents, authorizations and
filings that have been obtained or made and are in full force and effect or the
failure to obtain or make which would not have a Material Adverse Effect.
8.07. ERISA and Foreign Employee Benefit Matters. No ERISA Event has
------------------------------------------
occurred or is reasonably expected to occur that, when taken together with all
other such ERISA Events for which liability is reasonably expected to occur,
could reasonably be expected to result in a Material Adverse Effect. From and
after the consummation of the Spin-Off, no Company shall maintain or contribute
to or be required to maintain or contribute to any Pension Plan. Each ERISA
Entity is in compliance in all material respects with the presently applicable
provisions of ERISA and the Code with respect to each Employee Benefit Plan.
8.08. Taxes. Except as would not have a Material Adverse Effect, (i)
-----
all material tax returns, statements, reports and forms (including estimated Tax
or information returns) (collectively, the "Tax Returns") required to be filed
-----------
with any taxing authority by, or with respect to, each Company have been filed
in accordance with all applicable laws; (ii) each Company has timely paid or
made provision for payment of all material Taxes shown as due and payable on Tax
Returns that have been so filed, and, as of the time of filing, each Tax Return
correctly reflected the facts regarding income, business, assets, operations,
activities and the status of each Company (other than Taxes which are being
contested in good faith and for which adequate reserves are reflected on
financial statements subsequently delivered hereunder) and (iii) each Company
has made provision for all Taxes payable by such Company for which no Tax Return
has yet been filed.
8.09. Investment Company Act; Public Utility Holding Company Act;
-----------------------------------------------------------
Other Restrictions. No Company is required to register as an investment
------------------
company under the United States Investment Company Act of 1940, as amended. No
Company is a "holding company", or an "affiliate" of a "holding company" or a
"subsidiary company" of a "holding company", within the meaning of the United
States Public Utility Holding Company Act of 1935, as amended. No Obligor is
subject to regulation under any law or regulation which limits its ability to
incur Indebtedness, other than Regulation X of the Board of Governors of the
Federal Reserve System.
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8.10. Environmental Matters. Except as disclosed in Schedule 8.10
--------------------- -------------
and except as would not, individually or in the aggregate, result in a Material
Adverse Effect: (i) each Company is in compliance with, and is not subject to
liability under, any applicable Environmental Laws and there are no
Environmental Laws which could reasonably be expected to result in material
expenditures by any Company, and no such Environmental Laws would interfere in
any material way with current or projected operations of any Company; (ii) no
Company, or to the knowledge of the Obligors, any of its predecessors in
interest, has disposed of, arranged for the disposal or treatment of, or
otherwise released Hazardous Materials at any site at which any Person is
conducting any action under Environmental Law, which could reasonably be
expected to result in material expenditures by any Company; (iii) no Real
Property now owned, leased or operated by any Company nor to the knowledge of
the Obligors, any property formerly owned, leased or operated by the Companies
or any of their respective predecessors in interest is (x) listed or proposed
for listing on the National Priorities List under the United States
Comprehensive Environmental Response, Compensation and Liability Act of 1980, as
amended ("CERCLA"), or (y) listed on the Comprehensive Environmental Response,
------
Compensation and Liability Information System List promulgated pursuant to
CERCLA or (z) included on any similar lists maintained by any Governmental
Authority; (iv) there are no agreements, judgments, decrees or orders by which
any Company is bound, which would reasonably be expected to prevent any
Company's compliance with any Environmental Law, or which would reasonably be
expected to give rise to any liability of any Company under any Environmental
Law; (v) no Lien has been asserted or recorded or, to the knowledge of the
Obligors, threatened, under any Environmental Law with respect to Property of
any Company; and (vi) no Company is subject to any Proceeding alleging the
violation of, or liability under, any Environmental Law or has received any
Environmental Claim and, to the knowledge of the Obligors, no such Proceeding or
Environmental Claim is threatened.
8.11. Use of Proceeds. No Company is engaged principally, or as one
---------------
of its important activities, in the business of extending credit for the
purpose, whether immediate, incidental or ultimate, of buying or carrying Margin
Stock. Following application of the proceeds of each extension of credit
hereunder, not more than 25 percent of the value of the assets (either of
Borrower individually or of Consolidated Companies) will be Margin Stock.
Borrower will use the proceeds of (i) all Term B Facility Loans to finance the
Transactions and pay related fees and expenses and (ii) Revolving Loans to
finance the Transactions (in an amount not to exceed on the Closing Date
$75,000,000 unless consented to by the Lead Arranger in its sole discretion) and
for working capital and general corporate purposes.
8.12. Subsidiaries, Etc. As of the Effective Date, Borrower has no
-----------------
Subsidiaries or Equity Interests (whether direct or indirect) in partnerships,
Minority Interests or business trusts other than the entities set forth on
Schedule 8.12. Each Subsidiary listed on Schedule 8.12 (other than each Foreign
------------- -------------
Subsidiary and each Excluded Subsidiary) will be a Guarantor as of the Closing
Date. Borrower owns, as of the Effective Date, the percentage of the issued and
outstanding Equity Interests or other evidences of the ownership of each of its
Subsidiaries and each issuer of Minority Interests listed on Schedule 8.12 as
-------------
set forth on such Schedule. The outstanding Equity Interests of such
Subsidiaries and such Minority Interests are owned by Borrower free and clear of
all Liens and Equity Rights of others of any kind whatsoever, except for Liens
pursuant to the Security Documents and Liens thereon permitted by Section 9.07.
No such Subsidiary has issued any securities convertible
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into its Equity Interests (or other evidence of ownership) or any Equity Rights
to acquire such Equity Interests.
8.13. Ownership of Property; Liens. Except to the extent that any
----------------------------
failure to do so would not in the aggregate have a Material Adverse Effect, each
Company has good and marketable title to all of the assets and Property
(tangible and intangible) owned by it (except insofar as marketability may be
limited by any laws or regulations of any Governmental Authority affecting such
assets). All such assets and Property are free and clear of all Liens except
Liens permitted under Section 9.07. Except to the extent that any failure to do
so would not in the aggregate have a Material Adverse Effect, each Company has a
valid leasehold interest in all of the Real Property leased by it. All such
leasehold interests are free and clear of all Liens except for Liens permitted
under Section 9.07. Substantially all of the assets and Property owned by,
leased to or used by each Company in its respective businesses are in adequate
operating condition and repair, ordinary wear and tear excepted, are free and
clear of any known defects except such defects as do not substantially interfere
with the continued use thereof in the conduct of normal operations, and are able
to serve the function for which they are currently being used, except in each
case where the failure of such asset to meet such requirements would not result
in a Material Adverse Effect. Neither any Credit Document, nor any transaction
contemplated under any such document, will affect any right, title or interest
of any Company in any of such assets in a manner that would result in a Material
Adverse Effect.
8.14. Security Interest; Absence of Financing Statements; Etc. The
-------------------------------------------------------
Security Documents, once executed and delivered, will create, in favor of
Administrative Agent for the benefit of the Creditors, as security for the
obligations purported to be secured thereby, a valid and enforceable, and upon
filing or recording with the appropriate Governmental Authorities and delivery
of the applicable documents to Administrative Agent, to the extent contemplated
by the applicable Security Document, perfected security interest in and Lien
upon all of the Collateral (and the proceeds thereof), superior to and prior to
the rights of all third persons other than the holders of Permitted Liens.
Except for Prior Liens, as of the date hereof, and after the date
hereof, except for Permitted Liens, there is no currently effective financing
statement, security agreement, chattel mortgage, real estate mortgage or other
document filed or recorded with any filing records, registry, or other public
office, that purports to cover, affect or give notice of any Lien on, or
security interest in, any Property of any Company or rights thereunder.
8.15. Licenses and Permits. The Companies hold all governmental
--------------------
permits, licenses, authorizations, consents and approvals necessary for the
Companies to own, lease, and operate their respective Properties and to operate
their respective businesses as now being conducted (collectively, the
"Permits"), except for Permits the failure of which to obtain would not have a
-------
Material Adverse Effect. None of the Permits has been modified in any way that
has had a Material Adverse Effect. All Permits are in full force and effect
except where the failure to be in full force and effect would not have a
Material Adverse Effect.
8.16. True and Complete Disclosure. The information, reports,
----------------------------
financial statements, exhibits and schedules furnished in writing by or on
behalf of the Obligors to the Creditors in connec-
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tion with the negotiation, preparation or delivery of the Credit Documents or
included or delivered pursuant thereto or pursuant to the Confidential
Information Memorandum dated August 2001 distributed in connection with the
syndication of the Commitments and Loans, including all filings made with the
Commission by any Company, and the Credit Documents themselves, but in each case
excluding all projections, whether prior to or after the date of this Agreement,
when taken as a whole, do not, as of the date such information was furnished,
contain any untrue statement of material fact or omit to state a material fact
necessary in order to make the statements therein, in light of the circumstances
under which they were made, not materially misleading. The projections and pro
forma financial information furnished at any time by the Obligors to the
Creditors pursuant to this Agreement have been prepared in good faith based on
assumptions believed by Borrower to be reasonable at the time made, it being
recognized by the Lenders that such financial information as it relates to
future events is not to be viewed as fact and that actual results during the
period or periods covered by such financial information may differ from the
projected results set forth therein by a material amount and that no Obligor
makes any representation as to the ability of any Company to achieve the results
set forth in any such projections. Each Obligor understands that all such
statements, representations and warranties shall be deemed to have been relied
upon by the Lenders as a material inducement to make each extension of credit
hereunder.
8.17. Solvency. As of the Closing Date, after giving effect to the
--------
consummation of the Transactions and the extensions of credit to occur on such
date the Companies (on a consolidated basis) is Solvent.
8.18. Contracts. No Company is in default under any material
---------
contract or agreement to which it is a party or by which it is bound, nor, to
Borrower's knowledge, does any condition exist that, with notice or lapse of
time or both, would constitute such default, excluding in any case such defaults
that are not reasonably likely to have a Material Adverse Effect.
8.19. Labor Matters. Except as set forth in Schedule 8.19, there is
------------- -------------
(i) no unfair labor practice complaint pending against any Company or, to the
best knowledge of Borrower, threatened against any Company, before the National
Labor Relations Board or any other Governmental Authority, and no grievance or
arbitration proceeding arising out of or under any collective bargaining
agreement is so pending against any Company or, to the best knowledge of
Borrower after due inquiry, threatened against any Company, (ii) no strike,
labor dispute, slowdown or stoppage pending against any Company or, to the best
knowledge of Borrower, after due inquiry, threatened against any Company and
(iii) to the best knowledge of Borrower after due inquiry, no union
representation question existing with respect to the employees of any Company
and, to the best knowledge of Borrower, no union organizing activities are
taking place, except such as would not, with respect to any matter specified in
clause (i), (ii) or (iii) above, individually or in the aggregate, have a
Material Adverse Effect.
8.20. Intellectual Property. To the best knowledge of Borrower, each
---------------------
Company owns or possesses adequate licenses or otherwise has the right to use
all of the patents, patent applications, trademarks, trademark applications,
service marks, service xxxx applications, trade names, copyrights, trade
secrets, know-how and processes (collectively, "Intellectual Property") that are
---------------------
necessary for the operation of its business as presently conducted, except where
the failure to so own or possess
-75-
such Intellectual Property would not, individually or in the aggregate, have a
Material Adverse Effect. Except as set forth on Schedule 8.20, to the best
-------------
knowledge of Borrower, no claim is pending that any Company infringes upon the
asserted rights of any other Person under any Intellectual Property, except for
any such claim that would not, individually or in the aggregate, have a Material
Adverse Effect. Except as set forth on Schedule 8.20, to the best knowledge of
-------------
Borrower, no claim is pending that any such Intellectual Property owned or
licensed by any Company or which any Company otherwise has the right to use is
invalid or unenforceable, except for any such claim which would not,
individually or in the aggregate, have a Material Adverse Effect.
8.21. Existing Indebtedness. Schedule 8.21(A) sets forth a true
--------------------- ----------------
and complete list of all Indebtedness of the Companies as of the Effective Date
and Schedule 8.21(B) sets forth a true and complete list of all Indebtedness of
----------------
the Companies that is to remain outstanding after the Closing Date (excluding
the Obligations hereunder), in each case showing the aggregate principal amount
thereof and the name of each respective borrower and any other entity that
directly or indirectly guaranteed such Indebtedness.
8.22. Accuracy of Borrowing Base Components. Each component of the
-------------------------------------
Borrowing Base, as the same may be determined upon the initial extension of
credit hereunder or upon the delivery of any certificate pursuant to Section
9.01(j), meets all criteria of eligibility required to be met to be deemed a
component of the Borrowing Base at the time of such determination in accordance
with the definition of such component of the Borrowing Base.
Section 9. Covenants. Each Obligor, for itself and on behalf of its
---------
Subsidiaries, covenants and agrees with the Creditors that, so long as any
Commitment, Loan or L/C Liability is outstanding and until payment in full of
all amounts payable by Borrower hereunder (other than Obligations in respect of
indemnification and expense reimbursement and obligations under Section 5
hereof, in each case for which no claim has been made):
9.01. Financial Statements, Etc. Borrower shall deliver to
-------------------------
Administrative Agent and each of the Lenders:
(a) Quarterly Financials. As soon as available and in any event
--------------------
within 45 days after the end of each of the first three quarterly fiscal
periods of each fiscal year beginning with the fiscal quarter ending
September 30, 2001, consolidated (or, for periods prior to the Closing
Date, combined) statements of income for such period and consolidated (or,
for periods prior to the Closing Date, combined) statements of income and
cash flows for the period from the beginning of the respective fiscal year
to the end of such period, and the related consolidated balance sheet of
Consolidated Companies as at the end of such period, setting forth in each
case in comparative form the corresponding consolidated (or, for periods
prior to the Closing Date, combined) statements of income and cash flows
for the corresponding period in the preceding fiscal year to the extent
such financial statements are available, accompanied by a certificate of a
Responsible Officer of Borrower, which certificate shall state that said
consolidated financial statements fairly present in all material respects
the consolidated (or combined, as the case may be) financial condition,
results of operations and cash flows of Consolidated Companies in
accordance with GAAP, consistently applied, as at the end of, and
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for, such period (subject to normal year-end audit adjustments and except
for the absence of footnotes) (it being understood that the foregoing
requirement may be satisfied by delivery of a copy of Borrower's report on
Form 10-Q for the applicable fiscal quarter filed with the Commission);
(b) Annual Financials. As soon as available and in any event within
-----------------
90 days after the end of each fiscal year beginning with the fiscal year
ending December 31, 2001 consolidated (or, for periods prior to the Closing
Date, combined) statements of income, cash flows and changes in
stockholders' equity of Consolidated Companies for such year and the
related consolidated balance sheet of Consolidated Companies as at the end
of such year, setting forth in each case in comparative form the
corresponding consolidated (or, for periods or dates prior to the Closing
Date, combined) information as of the end of and for the preceding fiscal
year to the extent such financial statements are available, accompanied by
an opinion, without a going concern or similar qualification or exception
as to scope, thereon of PricewaterhouseCoopers LLP or other independent
certified public accountants of recognized national standing which opinion
shall state that said consolidated (or, for periods or dates prior to the
Closing Date, combined) financial statements fairly present in all material
respects the consolidated (or, for periods or dates prior to the Closing
Date, combined) financial condition, results of operations and cash flows
of Consolidated Companies as at the end of, and for, such fiscal year in
conformity with GAAP, consistently applied (it being understood that the
foregoing requirement may be satisfied by delivery of a copy of Borrower's
report on Form 10-K for the applicable fiscal year filled with the
Commission);
(c) Auditor's Certificate; Compliance Certificate. (i) Concurrently
---------------------------------------------
with the delivery of the financial statements referred to in Section
9.01(b), a certificate of the independent certified public accountants
reporting on such financial statements stating that in making the
examination necessary therefor no knowledge was obtained of any Event of
Default relating to the Financial Maintenance Covenants or the other
covenants contained in Section 9.11, except as specified in such
certificate; and
(ii) At the time it furnishes each set of financial statements
pursuant to paragraph (A) or (B) above, a certificate of a Responsible
Officer of Borrower (I) to the effect that no Default has occurred and is
continuing (or, if any Default has occurred and is continuing, describing
the same in reasonable detail and describing the action that the Companies
have taken and propose to take with respect thereto) and (II) setting forth
in reasonable detail the computations necessary to determine whether each
Company is in compliance with Section 9.11(a) and (b) as of the end of the
respective quarterly fiscal period or fiscal year;
(d) Other Financial Information. Promptly upon delivery thereof
---------------------------
to the holders of any debt securities or the stockholders of the Borrower
generally, copies of all financial statements and reports and proxy
statements so delivered, and at the time the same are filed, copies of all
financial statements and reports which Borrower may make to or file with
the Commission or any successor or analogous Governmental Authority;
-77-
(e) Interest Rate Certificates. From and after the Trigger Date,
--------------------------
together with the financial statements delivered pursuant to clause (a) or
(b) of this Section 9.01, an Interest Rate Certificate;
(f) Notice of Default. Except with respect to any Default which
-----------------
would not cause a Material Adverse Effect, promptly after any executive or
financial officer of Borrower knows that any Default has occurred, a notice
of such Default describing the same in reasonable detail and a description
of the action that the Companies have taken and propose to take with
respect thereto;
(g) Environmental Matters. Written notice (i) of any Environmental
---------------------
Claim materially affecting any Company or the operations of any Company and
(ii) any notice from any Person of (w) the occurrence of any Release of any
Hazardous Material that is reportable under any Environmental Law, (x) the
commencement of any clean-up pursuant to or in accordance with any
Environmental Law of any Hazardous Material or (y) any matters relating to
Hazardous Materials or Environmental Laws that, in each case set forth in
(i) or (ii) hereof, individually or in the aggregate, is reasonably likely
to have a Material Adverse Effect;
(h) Auditors' Reports. Promptly upon receipt thereof, copies of all
-----------------
annual, interim or special reports issued to any Company by independent
certified public accountants in connection with each annual, interim or
special audit of such Company's books made by such accountants;
(i) Borrowing Base Audits. (1) Once during each six-month period
---------------------
prior to the first anniversary of the Closing Date, and once per year
thereafter and (2) at any time at the request of Administrative Agent if an
Event of Default has occurred and is continuing, a report, the scope and
cost of which shall be reasonably acceptable to the Lenders and Borrower
(the reasonable cost and expense of which shall be for the sole account of
Borrower), of an independent collateral auditor (which may be, or be
affiliated with, one of the Lenders) with respect to the Accounts,
Inventory and Rental Assets included in the Borrowing Base as at the end of
a monthly accounting period;
(j) Borrowing Base Certificate. As soon as available and in any
--------------------------
event within 30 days after the end of each monthly accounting period
(ending on the last day of each calendar month) beginning with the monthly
accounting period ending September 30, 2001, a Borrowing Base Certificate
as of the last day of such accounting period; (if Borrower fails to deliver
any such Borrowing Base Certificate within 30 days after the end of any
such month, then the Borrowing Base shall be deemed to be $0 (provided,
--------
however, that no prepayment shall be required pursuant to Section 2.10(c)
-------
solely by reason of such deemed reduction) until such time as Borrower
shall deliver such required Borrowing Base Certificate); Borrower shall
notify Administrative Agent promptly upon becoming aware of any event or
condition that could reasonably be expected to have a material adverse
effect on the Borrowing Base;
(k) Annual Budgets. As soon as practicable and in any event within
--------------
90 days after the beginning of each fiscal year of Borrower beginning
December 31, 2001 a consolidated
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plan and financial forecast for such fiscal year, including a forecasted
consolidated balance sheet and forecasted consolidated statements of income
and cash flows of the Companies for such fiscal year and for each quarter
of such fiscal year, together with an Officers' Certificate demonstrating
pro forma compliance for such fiscal year with Section 9.11 and an
explanation of the assumptions on which such forecasts are based and
stating that such plan and projections have been prepared using assumptions
believed in good faith by management of Borrower to be reasonable at the
time made;
(l) [Reserved]
(m) Notice of Material Adverse Effect. Written notice of the
---------------------------------
occurrence of any Material Adverse Effect or any event or condition which
is reasonably likely to result in any Material Adverse Effect;
(n) ERISA Information. Promptly upon the occurrence of any ERISA
-----------------
Event that, alone or together with any other ERISA Events that have
occurred, could result in liability to the Companies in an aggregate amount
exceeding $7,500,000, a written notice specifying the nature thereof, what
action the Companies or other ERISA Entities have taken, are taking or
propose to take with respect thereto, and, when known, any action taken or
threatened by the Internal Revenue Service, Department of Labor, PBGC or
Multiemployer Plan sponsor with respect thereto;
(o) ERISA Filings, Etc. Upon request by Administrative Agent, copies
------------------
of: (i) each Schedule B (Actuarial Information) to the annual report (Form
5500 Series) filed by any Company with the Internal Revenue Service with
respect to each Pension Plan; (ii) the most recent actuarial valuation
report for each Pension Plan; (iii) all notices received by any Company
from a Multiemployer Plan sponsor or any governmental agency concerning an
ERISA Event; and (iv) such other documents or governmental reports or
filings relating to any Employee Benefit Plan as Administrative Agent shall
reasonably request; and
(p) Miscellaneous. Promptly, such financial and other information
-------------
with respect to any Company as Administrative Agent on behalf of any
Creditor may from time to time reasonably request.
9.02. Litigation, Etc. Borrower shall promptly give to
---------------
Administrative Agent and each Lender notice of all Proceedings, and (except to
the extent that any such notice would, in the reasonable opinion of Borrower,
waive attorney client privilege) any material development therein, affecting any
Company, except Proceedings which would not have a Material Adverse Effect.
9.03. Existence; Compliance with Law; Payment of Taxes; Inspection
------------------------------------------------------------
Rights; Performance of Obligations; Etc. Each Company shall (i) preserve and
---------------------------------------
maintain its legal existence and all of its material rights, privileges and
franchises; provided, however, that nothing in this Section 9.03 shall prohibit
-------- -------
any transaction expressly permitted under Section 9.06; (ii) except as would not
have a Material Adverse Effect, comply with all Requirements of Law; (iii)
except to the extent that any such failures, in the aggregate, would not result
in a Material Adverse Effect, timely file true,
-79-
accurate and complete tax returns required by all Governmental Authorities and
pay and discharge all Taxes imposed upon it or any of its Properties prior to
the date on which any penalties attach thereto (except for any such Tax the
payment of which is being contested in good faith and by proper proceedings
diligently instituted and conducted and against which adequate reserves or other
appropriate provisions are being maintained in accordance with GAAP; provided,
--------
however, that any such tax imposed upon Collateral shall be contested in a
-------
manner that satisfies the Contested Collateral Lien Conditions); (iv) maintain
all of its Properties used or useful in its business in good working order and
condition, ordinary wear and tear excepted, except to the extent that the
failure to do so would not have a Material Adverse Effect; (v) permit
representatives of any Creditor during normal business hours and upon reasonable
prior notice, to examine, copy and make extracts from its books and records, to
inspect its Properties, and to discuss its business and affairs with its
officers and employees, all to the extent reasonably requested by such Creditor
(provided that unless an Event of Default shall have occurred and be continuing
--------
all requests for any such examinations, meetings or discussions shall be
coordinated through the Administrative Agent); (vi) upon reasonable notice,
allow (with the presence of Borrower if Borrower so elects to participate)
Administrative Agent and the Lead Arranger or any representative chosen by the
Majority Lenders to consult with Borrower's independent public accountants and
auditors with respect to the financial affairs of the Companies at the request
of Administrative Agent and the Lead Arranger or any representative chosen by
the Majority Lenders, Borrower shall deliver a letter addressed to such
accountants instructing them to comply with the provisions of this Section
9.03(vi); (vii) perform in all material respects all of its Contractual
Obligations, except where such failure to so perform, singly or in the aggregate
with all other such failures, would not have a Material Adverse Effect; (viii)
pay all claims (including, without limitation, claims for labor, services,
materials and supplies) for sums which have become due and payable and which by
law have or may become a Lien (other than a Lien permitted under Section 9.07)
upon any Property of any Company, prior to the time when any penalty or fine
shall be incurred with respect thereto; provided, however, that that no claims
-------- -------
referred to in this clause (viii) need be paid if (x) being contested in good
faith by appropriate proceedings diligently instituted and conducted and if such
reserve or other appropriate provision, if any, as shall be required in
conformity with GAAP shall have been made therefor or (y) the aggregate of all
such failures to pay would not result in a Material Adverse Effect; provided,
--------
further, however, that any such claim or change imposed or asserted against
------- -------
Collateral shall be contested in a manner that satisfies the Contested
Collateral Lien Conditions.
9.04. Insurance. (A) Each Company shall maintain in full force and
---------
and effect insurance with respect to its Properties and business against at
least such casualties and contingencies and of at least such types and in at
least such amounts (with no greater risk retention) as are usually maintained,
retained or insured against in the same general area by companies of established
reputation of similar size and that are engaged in the same or a similar
business. All such policies and programs shall be maintained with responsible
and reputable insurers of companies engaged in similar businesses and owning
similar property in the same general geographic areas in which such Company, as
applicable, operates.
(B) All policies of insurance required to be maintained by any
Company must name Administrative Agent on behalf of the Creditors, as loss payee
(in the case of property insurance and business interruption insurance) or
additional insured (in the case of liability insurance), as applicable, and must
provide that no cancellation, non-renewal or modification (including reduced
coverage)
-80-
of the policies will be made without thirty days' prior written notice by the
applicable insurance carriers to Administrative Agent and if the insurance
carrier shall have received written notice from Administrative Agent of the
occurrence and continuance of an Event of Default, the insurance carrier shall
pay all proceeds otherwise payable to any Company under such policies directly
to Administrative Agent.
(C) Borrower shall give prompt written notice of any loss in excess
of $10,000,000 to the insurance carrier and to Administrative Agent.
9.05. Limitation on Lines of Business. No Company shall directly
-------------------------------
or indirectly, engage to any material extent in any line or lines of business
activity other than the business of the type conducted by the Companies as of
the Effective Date and any other businesses reasonably related thereto.
9.06. Limitation on Fundamental Changes, Acquisitions or
--------------------------------------------------
Dispositions. No Company shall, directly or indirectly, in a single
------------
transaction or series of transactions, (1) merge, consolidate or amalgamate with
or into any Person, or liquidate, wind up or dissolve itself (or suffer any
liquidation or dissolution), (2) effect any Acquisition, or (3) effect any
Disposition (or agree to do any of the foregoing), except that each of the
------
following shall be permitted:
(a) purchases, sales and Dispositions of Property and services in the
ordinary course of business;
(b) the pledge of the Collateral pursuant to the Security Documents
and the incurrence of any Permitted Lien;
(c) so long as no Default then exists or would arise therefrom, the
merger, consolidation, dissolution or liquidation of (1) any Subsidiary
with or into (i) Borrower so long as Borrower shall be the continuing or
surviving entity or (ii) any Qualified Subsidiary so long as the continuing
or surviving entity shall be a Qualified Subsidiary; and (2) any Non-
Qualified Subsidiary with or into any other Non-Qualified Subsidiary;
(d) Dispositions by any Company to any other Company;
(e) Dispositions of used, worn out, obsolete or surplus Property by
any Company in the ordinary course of business and the abandonment or other
Disposition of Intellectual Property that is, in the reasonable judgment of
Borrower, no longer economically practicable to maintain or useful in the
conduct of the business of the Companies taken as a whole; provided,
--------
however, that in each case the proceeds thereof shall be reinvested in the
-------
business of a Company within one year of such Disposition;
(f) the sale or discount without recourse of accounts receivable or
notes receivable arising in the ordinary course of business, or the
conversion or exchange of accounts receivable into or for notes receivable,
in connection with the compromise or collection thereof; provided, however,
-------- -------
that, in the case of any Foreign Subsidiary, any such sale or discount may
-81-
be with recourse if such sale or discount is consistent with customary
practice in such Foreign Subsidiary's country of business and the aggregate
amount of any such recourse shall (to the extent such recourse is required
by GAAP to be included as Indebtedness on the consolidated balance sheet of
Consolidated Companies) be included in the determination of Indebtedness
for purposes of Section 9.08;
(g) so long as no Event of Default then exists or would arise
therefrom, any Disposition for fair market value so long as the net
proceeds from all Dispositions does not exceed (i) $10,000,000 in any
fiscal year or (ii) $25,000,000 in the aggregate after the Effective Date;
provided, however, that the Net Available Proceeds therefrom shall be
-------- -------
applied as specified in Section 2.10(a)(iii);
(h) Acquisitions by any Company; provided, however, that each
-------- -------
Acquisition under this Section 9.06(h) shall satisfy each of the following
conditions:
(i) no Event of Default then exists or would arise therefrom;
(ii) after giving pro forma effect in accordance with GAAP to
such Acquisition, Borrower shall be in compliance with all covenants
set forth in Section 9.11 as of the Test Date immediately prior to the
consummation thereof (assuming, for purposes of Section 9.11, that
such Acquisition, and all other Permitted Acquisitions consummated
since the first day of the relevant measurement period for each
financial covenant set forth in Section 9.11 ending on or prior to the
date of such Acquisition, had occurred on the first day of such
relevant measurement period);
(iii) the board of directors of the acquired Person shall not
have indicated privately at the time of consummation of the
Acquisition to any Company or publicly its opposition to the
consummation of such Acquisition;
(iv) the Person or business acquired shall, after giving
effect to such Acquisition, be merged or combined or consolidated with
or into Borrower or a Subsidiary (so long as, with respect to
Borrower, Borrower is the surviving Company) or shall be or become,
after giving effect thereto, a Subsidiary;
(v) with respect to any Acquisition involving Acquisition
Consideration of more than $10,000,000, Borrower shall have provided
the Lenders not fewer than 15 days prior to the proposed closing
thereof, with (1) written notice thereof and a brief description of
the material terms thereof and a brief description of the business or
Person to be acquired, (2) to the extent available to Borrower,
historical financial statements for the last three fiscal years (or,
if less, for the period of such Person's existence) of the Person or
business to be acquired for the most recent interim period which are
available, (3) copies of all available material documentation
pertaining to such Acquisition, and (4) all such other available
information and data relating to such Acquisition or the Person or
business to be acquired as may be reasonably requested by the Lead
Arranger or the Majority Lenders;
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(vi) with respect to any Acquisition involving Acquisition
Consideration of more than $10,000,000, Borrower shall have delivered
to the Lead Arranger and the Lenders an Officers' Certificate at least
five days prior to the date of consummation of such Acquisition (but
in any event not earlier than a date which would result in the Test
Date occurring on or immediately prior to the consummation of such
Acquisition being more than 135 days prior to the date of consummation
of such Acquisition) certifying that (1) such Acquisition complies
with this Section 9.06(h) (which shall have attached thereto
reasonably detailed backup data and calculations showing such
compliance), and (2) such Acquisition is not reasonably likely to have
a Material Adverse Effect;
(vii) after giving effect to such Acquisition (including any
incurrence of Indebtedness by the Companies in connection therewith),
the Borrower shall thereupon have the ability to borrow not less than
$20,000,000 in the form of a Revolving Loan pursuant to this
Agreement;
(viii) the Acquisition Consideration for such Acquisition
(other than any Acquisition Consideration consisting of Equity
Interests (other than Disqualified Equity Interests) or proceeds from
the issuance by Borrower of its Equity Interests (other than
Disqualified Equity Interests)) (collectively, the "Equity Acquisition
------------------
Consideration") together with the aggregate amount of the Acquisition
-------------
Consideration (other than Equity Acquisition Consideration) for all
Acquisitions effected pursuant to this Section 9.06(h) since the
Effective Date, shall not exceed $30,000,000; and
(ix) with respect to any Acquisition (x) by a Qualified
Company of Property of the type constituting Collateral or (y) of a
Person required to become a Qualified Subsidiary, the Company making
such Acquisition shall take all actions required pursuant to Sections
--------
9.12 and 9.13 hereof to make such Property or Person subject to the
---- ----
Security Documents.
(i) transfers resulting from any Casualty Event; provided, however,
-------- -------
that the Net Available Proceeds therefrom shall be applied as specified in
Section 2.10(a)(i);
(j) licenses or sublicenses by any Company of software, Intellectual
Property and general intangibles and leases, licenses or subleases of other
Property in the ordinary course of business, which do not materially
interfere with the business of the Companies;
(k) any consignment arrangements or similar arrangements for the sale
of assets in the ordinary course of business of the Companies; and
(l) the making of Investments permitted by Section 9.09 and the
liquidation in the ordinary course of business of (A) Cash Equivalents and
(B) Investments made pursuant to clause (a) of the definition of Permitted
Investments.
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No Company shall, unless consented to by the Majority Lenders, effect
the Disposition of any Equity Interests of any Subsidiary unless in compliance
with the foregoing provisions and unless all such Equity Interests owned by the
Companies are sold pursuant thereto in accordance with the Credit Documents,
upon which sale the Guarantee by such Subsidiary shall be automatically deemed
to be released.
Subject to Section 12.04, to the extent the Majority Lenders waive the
provisions of this Section 9.06 with respect to the sale or other disposition of
any Collateral, or any Collateral is sold or otherwise disposed of as permitted
by this Section 9.06 (other than to any Company), such Collateral in each case
shall be sold or otherwise disposed of free and clear of the Liens created by
the Security Documents and Administrative Agent shall take such actions as are
appropriate in connection therewith.
9.07. Limitation on Liens and Negative Pledges. No Company shall,
----------------------------------------
directly or indirectly, create, incur, assume or suffer to exist any Lien upon
or with respect to any of its Property, whether now owned or hereafter acquired,
except for each of the following (which are herein collectively referred to as
"Permitted Liens"):
--------- -----
(a) Liens (including any Prior Liens) in existence on the Effective
Date and identified in Schedule 9.07;
-------------
(b) Permitted Customary Liens;
(c) Liens upon Property acquired after the Effective Date by any
Company, which Liens either (A) existed on such Property before the time of
its acquisition and was not created in anticipation thereof, or (B) were
created solely for the purpose of securing Indebtedness representing, or
incurred to finance or refinance, the cost of such Property or improvements
thereon; provided, however, that (1) no such Lien shall extend to or cover
-------- -------
any Property of any Company other than the Property so acquired and
improvements thereon and proceeds thereof, (2) the principal amount of
Indebtedness secured by any such Lien shall at no time exceed 100% of the
fair market value of such Property at the time it was acquired or
constructed and (3) the Indebtedness secured by any such Lien is permitted
by Section 9.08(f);
(d) Liens existing on any Property at the time such Property is
acquired or the owner thereof becomes a Subsidiary or is merged or
consolidated with or into a Subsidiary and, in each case, not created in
contemplation of or in connection with such event; provided, however, that
-------- -------
(1) such Liens do not extend to any other Property of any Company and (2)
any Indebtedness secured by any such Lien is permitted by Section 9.08(g);
(e) Liens not otherwise permitted hereunder securing obligations of
any Company at any time not exceeding (as to all of the Companies) in the
aggregate $5,000,000;
(f) Liens securing obligations under Swap Contracts with any Creditor
to the extent such Swap Contract relates to the Loans and only so long as
the Obligations are secured by the same collateral on at least a pari passu
---- -----
basis;
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(g) Liens securing obligations in respect of Capital Leases solely on
Property (including improvements thereto and the proceeds thereof) subject
to such Capital Leases; provided, however, that such Capital Leases are
-------- -------
permitted by Section 9.08(f);
(h) Liens created under the Credit Documents securing the
Obligations;
(i) Liens securing Contingent Obligations permitted under clause (e)
of the definition of Permitted Obligations not exceeding (as to all of the
Companies) $8,000,000 in aggregate amount at any time outstanding;
(j) any extension, renewal or replacement of the foregoing; provided,
--------
however, that the Liens permitted by this Section 9.07(j) shall not cover
-------
any additional principal amount of Indebtedness or Property (other than
like Property substituted for Property covered by such Lien); and
(k) Liens securing obligations in respect of trade letters of credit
permitted under Section 9.08(e) and clause (f) of the definition of
"Permitted Obligations," provided, that such Liens shall not extend to any
--------
Property other than the goods financed or paid for with such letters of
credit, documents of title in respect thereof and proceeds thereof.
Except with respect to (i) specific Property encumbered pursuant to a
Lien permitted to be incurred pursuant to this Section 9.07, (ii) specific
Property to be sold pursuant to any Disposition or Excluded Disposition or (iii)
specific Property subject to a lease under which a Company is the lessee, no
Company will directly or indirectly enter into or suffer to exist any
Contractual Obligation on or after the Effective Date prohibiting or restricting
in any manner (directly or indirectly and including by way of covenant,
representation or warranty or event of default) the creation or assumption of
any Lien upon its Property, whether now owned or hereafter acquired, except
pursuant to (1) the Credit Documents, (2) any other agreement that expressly
allows and does not restrict in any manner (directly or indirectly) Liens
created pursuant to the Credit Documents on Property of any Company (whether now
owned or hereafter acquired) securing the Obligations and does not require the
direct or indirect granting of any Lien securing any Indebtedness or other
obligation by virtue of the granting of Liens on or pledge of Property of any
Company to secure the Obligations, (3) any industrial revenue or development
bonds (in which case, any prohibition or limitation shall only be effective
against the Property financed or acquired thereby) or operating leases of Real
Property and related personal property entered into in the ordinary course of
business or (4) any agreement or instrument evidencing or governing any
Indebtedness permitted under Section 9.08(b), (g) or (h).
9.08. Prohibition on Disqualified Capital Stock; Limitation on
--------------------------------------------------------
Indebtedness and Contingent Obligations. No Company shall directly or
---------------------------------------
indirectly issue or permit to be outstanding any Disqualified Capital Stock. No
Company shall, directly or indirectly, incur or suffer to exist any Indebtedness
or any Contingent Obligation, except for each of the following:
------
(a) Obligations (including the Guarantees) under the Credit
Documents;
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(b) Indebtedness and Contingent Obligations outstanding on the
Effective Date and listed in Schedule 8.22 and specified on Schedule 8.22
------------- -------------
as to remain outstanding after the Effective Date and refinancings thereof
that do not increase the aggregate principal amount thereof;
(c) Indebtedness and Contingent Obligations of any Company owing to
any Company; it being understood that the aggregate principal amount of
Indebtedness of all Non-Qualified Companies owing to all Qualified
Companies permitted under this clause (c) (other than Indebtedness to the
extent that the proceeds therefrom shall have been used to fund Permitted
Acquisitions) that is outstanding at any one time shall not exceed
$10,000,000 in the aggregate;
(d) Contingent Obligations of any Company in respect of Indebtedness
or other liabilities of any Company to the extent that the existence of
such Indebtedness or other liabilities is not prohibited under this
Agreement and on substantially similar terms as such Indebtedness;
(e) Permitted Obligations;
(f) Indebtedness and Contingent Obligations of the Companies secured
by Liens permitted under Section 9.07(c) or (g) (and extensions, renewals
or replacements thereof pursuant to Section 9.07(j)) not exceeding
$5,000,000 in the aggregate at any time outstanding for the Companies
collectively;
(g) Indebtedness of a Person that becomes a Subsidiary after the
Effective Date; provided, however, that (1) such Indebtedness existed at
-------- -------
the time such Person became a Subsidiary and was not created in connection
with or in anticipation thereof, (2) immediately after giving effect to the
acquisition of such Person by Borrower no Event of Default shall have
occurred and be continuing, and (3) the aggregate amount of Indebtedness
outstanding at any time pursuant to this Section 9.08(g) shall not exceed
$5,000,000 for all Subsidiaries;
(h) Indebtedness of Foreign Subsidiaries, and Contingent Obligations
of Foreign Subsidiaries in respect of such Indebtedness, in an aggregate
principal amount at any time outstanding not to exceed $5,000,000;
(i) Indebtedness, if any, under any Swap Contract in respect of the
Loans or Letters of Credit or otherwise entered into by the Companies to
hedge against interest rate, currency exchange rate or commodity price
risk, in each case arising in the ordinary course of business and not for
speculative purposes; and
(j) so long as no Event of Default exists at the time of incurrence
thereof or would arise therefrom, Indebtedness and Contingent Obligations
incurred by any Company not to exceed in the aggregate at any time
outstanding $5,000,000.
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All intercompany debt owed by any Qualified Company to any Non-
Qualified Company shall be unsecured and subordinate in right of payment (to the
same extent as the subordination provisions set forth in Exhibit B hereto) to
---------
the Obligations.
9.09. Limitation on Investments; Limitation on Creation of
----------------------------------------------------
Subsidiaries. (A) No Company shall, directly or indirectly, make or permit
------------
to remain outstanding any Investments, except for each of the following:
------
(a) Permitted Investments and Investments that were Permitted
Investments when made;
(b) (i) Investments in any Qualified Company or in any Subsidiary if
as a result thereof or in connection therewith such Subsidiary becomes a
Qualified Subsidiary and (ii) Investments by any Non-Qualified Subsidiary
in (A) any Company or (B) any Person not a Subsidiary if as a result
thereof or in connection therewith such Person becomes a Subsidiary
(provided that no Investment will be permitted in respect of any Subsidiary
--------
with respect to which Borrower has not complied with Section 9.20 to the
extent that such Section 9.20 is applicable to such Subsidiary);
(c) Investments outstanding on the Effective Date and identified in
Schedule 9.09 and, so long as no Default then exists or would arise
-------------
therefrom, any renewals, amendments and replacements thereof that do not
increase the amount thereof;
(d) advances, loans or extensions of credit by any Company to (1)
officers, directors or employees of any Company and, in the case of loans
and advances to finance the acquisition of common stock of Borrower, to
immediate family members or relatives thereof, or trusts or partnerships
for the benefit of any of the foregoing, or any of their heirs, executors
or legal representatives, (i) in the ordinary course of business for travel
and entertainment or relocation expenses, (ii) made after the Effective
Date for other purposes, not to exceed (as to Borrower and all its
Subsidiaries) $2,000,000 in the aggregate outstanding at any time, plus the
net cash proceeds received by Borrower since the Effective Date from the
issuance or sale of Equity Interests of Borrower (including any Equity
Rights in respect thereof) to any such Person, or (iii) relating to
indemnification or reimbursement of any officers, directors or employees in
respect of liabilities relating to their serving in any such capacity or as
otherwise specified in Section 9.15, and (2) officers, directors or
employees of any Company in connection with stock option, restricted stock
or other similar plans so long as (x) such loans do not involve cash
payments by any Company and (y) no Company incurs any obligations at any
time to repurchase the stock so purchased;
(e) additional Investments in any Non-Qualified Subsidiary of which,
after giving effect to such Investments, not less than 51% of the Equity
Interests are owned directly or indirectly by Borrower, in an aggregate
amount not to exceed $5,000,000 at any time outstanding;
(f) Investments in any Non-Qualified Subsidiary to the extent made in
the ordinary course to fund or support the ordinary course operations of
such Subsidiary; provided, how-
-------- ----
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ever, that (1) other than with respect to any Subsidiary of which, after
----
giving effect to such Investment, not less than 51% of the Equity Interests
are owned directly or indirectly by Borrower, the amount of such
Investments made pursuant to this clause (f) shall not exceed $10,000,000
in the aggregate outstanding at any time, (2) no such Investment shall be
permitted which individually or in the aggregate would result in all or any
substantial part of the assets of the Qualified Companies being transferred
to Non-Qualified Subsidiaries, and (3) all such Investments shall be
evidenced by Intercompany Notes, which shall be pledged to Administrative
Agent pursuant to the Security Agreement;
(g) the ownership of Equity Interests of any Subsidiary existing on
the Effective Date or created or acquired thereafter in accordance with the
provisions hereof and any additional Equity Interests issued in exchange
therefor or as a dividend thereon;
(h) Investments consisting of non-cash consideration received in the
form of securities, notes or similar obligations in connection with any
Disposition; provided, however, that (1) the aggregate amount of such non-
-------- -------
cash consideration received in connection with any such Disposition shall
not exceed 25% of the total consideration received in connection with such
Disposition, (2) such non-cash consideration is pledged pursuant to the
appropriate Security Document (other than if received by any Foreign
Subsidiary), and (3) the aggregate amount of such Investments made and
outstanding at any time shall not exceed $5,000,000 (without giving effect
to any write-downs or write-offs thereof);
(i) so long as no Event of Default then exists or would arise
therefrom, Investments consisting of or made in order to consummate
Permitted Acquisitions;
(j) Swap Contracts permitted under Section 9.08(i); and
(k) so long as no Event of Default then exists or would arise
therefrom, Investments not otherwise permitted by this Section 9.09 in an
aggregate amount outstanding at any time not to exceed $5,000,000 for all
Companies.
(B) No Company shall, directly or indirectly, create or acquire any
Subsidiary without the prior written consent of the Majority Lenders, which
consent shall not be unreasonably withheld; provided, however, that (1) the
-------- -------
provisions of this Section 9.09(B) shall not require the Majority Lenders'
consent for (I) the creation or acquisition of direct or indirect Wholly Owned
Subsidiaries so long as Section 9.20 is complied with at the time of formation
or acquisition thereof and such creation or acquisition is otherwise permitted
under Section 9.09(A) and (II) the creation or acquisition of any Subsidiary
which is not a Wholly Owned Subsidiary so long as the Investment made in
connection therewith complies with Section 9.09(A) and so long as Section 9.20
is complied with at the time of formation or acquisition thereof; and (2) all
Investments in any Subsidiary, including in connection with the creation or
acquisition thereof, must comply with Section 9.09(A).
9.10. Limitation on Dividend Payments. No Company shall, directly or
-------------------------------
indirectly, declare or make any Dividend Payment at any time, except, without
------
duplication:
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(a) any Subsidiary may declare and make Dividend Payments to Borrower
or any Subsidiary and to minority interest holders in such Subsidiary if
made on a pro rata basis to all holders of Equity Interests of the
--- ----
applicable class in such Subsidiary at the same time except that no
Qualified Subsidiary may make any Dividend Payment to any Non-Qualified
Subsidiary;
(b) the making of the Special Dividend Payment; and
(c) so long as no Event of Default has occurred and is continuing or
would arise therefrom:
(i) repurchases of Equity Interests of Borrower in an amount
not to exceed $20,000,000 in the aggregate after the Effective Date;
(ii) Dividend Payments to redeem Equity Interests (other than
Disqualified Capital Stock) held by current or former employees,
officers or directors of any Company (or their estates or
beneficiaries of their estates) upon the death, disability, retirement
or termination of employment or directorship, as the case may be,
pursuant to any employment agreement, management equity subscription
agreement, restricted stock plan, stock option agreement or other
similar arrangements; provided, however, that the aggregate cash
-------- -------
consideration paid, or distributions made, pursuant to this clause (c)
(ii) shall not exceed $2,000,000 in any fiscal year ending after the
Effective Date; and
(iii) redemption of options or warrants in connection with the
"cashless exercise" thereof.
9.11. Financial Covenants.
-------------------
(a) Maximum Total Leverage Ratio. The Total Leverage Ratio shall
----------------------------
not, as of any Test Date occurring during any period set forth in the table
below, exceed the ratio set forth opposite such period in the table below:
Period Ratio
------ -----
Closing Date to December 31, 2002 2.25 to 1.0
January 1, 2003 to December 31, 2004 2.00 to 1.0
January 1, 2005 to Final Maturity Date 1.75 to 1.0
(b) Minimum Consolidated EBITDA. Consolidated EBITDA shall not for
---------------------------
the previous four consecutive fiscal quarters most recently ended as of any Test
Date occurring during any period set forth in the table below, be less than the
amount set forth opposite such period in the table below:
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Period EBITDA
------ ------
Closing Date- $115,000,000
December 31, 2001
January 1, 2002- 100,000,000
March 31, 2002
April 1, 2002- 100,000,000
June 30, 2002
July 1, 2002- 105,000,000
September 30, 2002
October 1, 2002- 115,000,000
December 31, 2002
January 1, 2003- 117,000,000
March 31, 2003
April 1, 2003- 120,000,000
June 30, 2003
July 1, 2003- 120,000,000
September 30, 2003
October 1, 2003- 122,000,000
December 31, 2003
January 1, 2004- 125,000,000
March 31, 2004
April 1, 2004- 128,000,000
June 30, 2004
July 1, 2004- 130,000,000
September 30, 2004
October 1, 2004- 133,000,000
December 31, 2004
2005 143,000,000
2006 152,000,000
2007 160,000,000
(c) Limitation on Capital Expenditures.
----------------------------------
(A) No Company shall, directly or indirectly, permit the aggregate
amount of all Capital Expenditures made by the Companies in any fiscal year (not
including the additional Capital Expenditures permitted by Section 9.11(c)(B))
to exceed, for the fiscal year ending on (1) December
-90-
31, 2001, $100,000,000, (2) December 31, 2002, $100,000,000, (3) December 31,
2003, $105,000,000 and (4) December 31, 2004 and for each fiscal year
thereafter, $110,000,000.
(B) If actual Consolidated EBITDA for any fiscal year exceeds the
minimum Consolidated EBITDA set forth in Section 9.11(b) for such fiscal year
(such excess, the "Excess EBITDA"), the Companies shall be permitted to make
-------------
additional Capital Expenditures in respect of Rental Assets only (the
"Additional Rental Capex") in the applicable amounts set forth in the following
------------------------
table:
If Excess EBITDA is: The Additional Rental Capex amount is:
------------------- -------------------------------------
$5,000,000 or over but not over $15,000,000 50% of the Excess EBITDA over $5,000,000
Over $15,000,000 but not over $25,000,000 $5,000,000 plus 75% of the Excess EBITDA
over $15,000,000
Over $25,000,000 $12,500,000 plus 100% of the Excess EBITDA
over $25,000,000
(C) If, with respect to any fiscal year, the amount permitted to be
expended by the Companies on Capital Expenditures pursuant to clause (A) of this
Section 9.11(c) (such amount, the "Base Amount") for such year exceeds the
-----------
amount actually expended by the Companies in such year in respect of Capital
Expenditures (not including amounts spend on Capital Expenditures permitted by
the immediately preceding clause (B)), then such excess (up to an amount not to
exceed the Applicable Percentage of the Base Amount (the "Carryover")) shall be
---------
applied to increase the maximum amount permitted to be spent by the Companies in
respect of Capital Expenditures in the next succeeding (but not any other)
fiscal year; provided, however, that in determining the amount of Carryover for
-------- -------
any fiscal year, the amount expended in respect of Capital Expenditures shall
first be deemed to be from the amount allocated to such fiscal year before
giving effect to any Carryover.
9.12. Additional Security; Landlord Consents. (a) If any Company
--------------------------------------
(other than any Excluded Subsidiary or any Foreign Subsidiary) shall acquire any
Property after the Closing Date (other than (x) any Real Property, automobiles
or Property expressly excluded from the Security Agreement and (y) any Property
subject to a Lien expressly permitted by Section 9.07 solely to the extent that
such Lien or the obligations secured thereby expressly prohibit the pledge of
the Property subject to such Lien) as to which Administrative Agent, for the
benefit of the Lenders, does not have a perfected Lien, promptly (i) execute and
deliver to Administrative Agent such amendments to the Security Documents or
such other documents as Administrative Agent deems necessary or advisable in
order to grant to Administrative Agent, for the benefit of the Lenders, a
security interest in such Property and (ii) take all actions necessary or
advisable to grant to Administrative Agent, for the benefit of the Lenders, a
perfected security interest in such Property, subject only to Permitted Liens,
including without limitation, the filing of UCC financing statements in such
jurisdictions as may be required by the Security Documents or by law or as may
be requested by Administrative Agent.
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(b) At its own expense, Borrower shall request, and use reasonable
best efforts (it being understood that such efforts shall not include the
payment of money or the agreement to material concessions) to obtain, (i) a
consent (the "Landlord Consents"), substantially in the form of Exhibit K or
----------------- ---------
such other form as may be reasonably satisfactory to Administrative Agent, from
the landlord of each Real Property listed in Schedule 9.12(C), copies of which
----------------
consent, if obtained, shall be delivered to Administrative Agent by the
Effective Date or as soon as practicable thereafter and (ii) prior to entering
into a lease of a facility in which at least $5,000,000 of Inventory is, or is
expected to be, located on or after the Effective Date, a consent, substantially
in the form of Exhibit K or such other form as may be reasonably satisfactory to
---------
Administrative Agent, from each landlord of any such facility.
(c) The costs of all actions taken by the parties in connection with
this Section 9.12, including reasonable costs of counsel for Administrative
Agent, shall be paid by the Obligors promptly following written demand.
9.13. Security Interests; Further Assurances. (a) Each Qualified
--------------------------------------
Company shall, promptly, upon the reasonable request of Administrative Agent or
any Lender, at Borrower's expense, execute, acknowledge and deliver, or cause
the execution, acknowledgment and delivery of, and thereafter register, file or
record, or cause to be registered, filed or recorded, in an appropriate
governmental office, any document or instrument supplemental to or confirmatory
of the Security Documents or otherwise deemed by Administrative Agent reasonably
necessary or desirable for the continued validity, perfection and priority of
the Liens on the Collateral covered thereby superior to and prior to the rights
of all third Persons other than the holders of Permitted Collateral Liens, or
obtain any consents as may be necessary or appropriate in connection therewith.
Each Qualified Company shall deliver or cause to be delivered to Administrative
Agent from time to time such other documentation, consents, authorizations,
approvals and orders in form and substance reasonably satisfactory to
Administrative Agent as Administrative Agent shall reasonably deem necessary to
perfect or maintain the Liens on the Collateral pursuant to the Security
Documents. Upon the exercise by Administrative Agent or the Lenders of any
power, right, privilege or remedy pursuant to any Credit Document which requires
any consent, approval, registration, qualification or authorization of any
Governmental Authority, each Qualified Company shall execute and deliver all
applications, certifications, instruments and other documents and papers that
Administrative Agent or the Lenders may be so required to obtain.
(b) At the request of Administrative Agent made at any time after the
occurrence and during the continuance of any Event of Default and in form and
manner reasonably satisfactory to Administrative Agent, each Obligor shall
legend its Accounts, Instruments and the other books, records and documents of
such Obligor evidencing or pertaining to its Accounts with an appropriate
reference to the fact that such Accounts have been pledged to Administrative
Agent for the benefit of the Secured Parties and that Administrative Agent has a
security interest therein.
9.14. Compliance with Environmental Laws. Each Company shall (a)
----------------------------------
comply with all Environmental Laws, and will keep or cause all Real Property to
be kept free of any Liens under Environmental Laws, unless failure to do any of
the foregoing would not have a Material Adverse Effect; and (b) in the event of
any Hazardous Material at, on, under or emanating from any Real Prop-
-92-
erty which could result in liability under or a violation of any Environmental
Law, in each case which could reasonably be expected to have a Material Adverse
Effect, undertake, and/or cause any of its respective tenants or occupants to
undertake, at their sole expense, any action required pursuant to Environmental
Laws to mitigate and eliminate such condition; provided, however, that no
-------- -------
Company shall be required to comply with any order or directive which is being
contested in good faith and by proper proceedings so long as it has maintained
adequate reserves with respect to such compliance to the extent required in
accordance with GAAP.
9.15. Limitation on Transactions with Affiliates and Related Persons.
--------------------------------------------------------------
No Company shall, directly or indirectly: enter into or permit to exist any
transaction (including, without limitation, the purchase, sale, lease or
exchange of any Property, the rendering of any service, or a merger, Acquisition
or other consolidation), with or for the benefit of any Affiliate or any Related
Person (an "Affiliate Transaction") unless such Affiliate Transaction is
---------------------
otherwise not prohibited under this Agreement and is (i) between or among
Companies, (ii) between or among a Company (on the one hand) and one or more
Wholly Owned Subsidiaries, or (iii) on fair and reasonable terms that are not
less favorable to such Company than those that are reasonably obtainable at the
time in an arm's-length transaction with a Person that is not such an Affiliate,
except that, notwithstanding the foregoing, each of the following shall be
------
permitted: (a) loans or advances to employees permitted by Section 9.09 and
Dividend Payments permitted by Section 9.10; (b) fees and compensation paid to,
and customary indemnity and reimbursement provided on behalf of, officers,
directors and employees of any Company in the ordinary course of business; (c)
transactions and agreements in existence on the Effective Date and listed in
Schedule 9.15 (as such agreements are in effect on the Effective Date, the
-------------
"Existing Affiliate Agreements") and any amendment thereto that is not
------------------------------
disadvantageous to the Lenders in any material respect; and (d) any employment
agreements entered into by any Company in the ordinary course of business.
9.16. Limitation on Accounting Changes; Limitation on Investment
----------------------------------------------------------
Company Status. No Company shall make or permit any change in (i) accounting
--------------
policies or reporting practices, except immaterial changes and except as
required or permitted by generally accepted accounting principles or (ii) its
fiscal year end (December 31 of each year). No Obligor shall be or become an
investment company subject to the registration requirements under the United
States Investment Company Act of 1940, as amended.
9.17. Limitation on Modifications of Certain Documents, Etc. No
-----------------------------------------------------
Company shall, directly or indirectly, consent to any modification, supplement,
waiver or termination of, or amend, in any manner which could reasonably be
expected to be materially adverse to the Lenders, or result in a Material
Adverse Change, any of the provisions of any Organic Document.
9.18. Interest Rate Protection Agreements. Within 90 days after
-----------------------------------
the Closing Date, Borrower shall enter into Interest Rate Protection Agreements
designed to protect Borrower against fluctuations in interest rates with respect
to at least 50% of the aggregate principal amount of Term B Facility Loans for a
period of at least 36 months from the Closing Date with counterparties
reasonably satisfactory to the Lead Arranger and the Administrative Agent.
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9.19. Limitation on Certain Restrictions Affecting Subsidiaries. No
---------------------------------------------------------
Company shall, directly or indirectly, create or otherwise cause or suffer to
exist or become effective any direct or indirect encumbrance or restriction on
the ability of any Subsidiary to (a) pay dividends or make any other
distributions on such Subsidiary's Equity Interests or any other interest or
participation in its profits owned by any Company, or pay any Indebtedness or
any other obligation owed to any Company, (b) make Investments in or to any
Company, or (c) transfer any of its Property to any Company, except that each of
------
the following shall be permitted (i) any such encumbrances or restrictions
existing on the Effective Date and described on Schedule 9.19 or existing under
-------------
or by reason of (x) applicable Law, or (y) the Credit Documents, (ii)
restrictions on the transfer of Property subject to a Permitted Lien permitted
under Section 9.07, (iii) customary restrictions on subletting or assignment of
any lease governing a leasehold interest of any Company, (iv) restrictions on
the transfer of any Property subject to a Disposition permitted under this
Agreement and (v) customary restrictions contained in any agreement or
instrument evidencing or governing Indebtedness permitted under Section 9.08(h),
which restrictions are applicable solely to the Foreign Subsidiary or Foreign
Subsidiaries liable with respect to such Indebtedness.
9.20. Additional Obligors. Upon any Company (other than any Excluded
-------------------
Subsidiary or any Foreign Subsidiary) creating or acquiring any Subsidiary after
the Effective Date, such Company shall, within 30 days after such creation or
acquisition, (i) cause each such Subsidiary that is a Wholly Owned Subsidiary
(other than any Excluded Subsidiary or any Foreign Subsidiary) to execute and
deliver all such agreements, guarantees, documents and certificates (including a
Joinder Agreement and any amendments to the Credit Documents) as Administrative
Agent or the Majority Lenders may reasonably request and do such other acts and
things as Administrative Agent or the Majority Lenders may reasonably request in
order to have such Subsidiary become a Guarantor, (ii) promptly, (I) execute and
deliver to Administrative Agent such amendments to the Security Documents as
Administrative Agent deems necessary or advisable in order to grant to
Administrative Agent, for the benefit of the Creditors, a perfected first
priority security interest in the Equity Interests and debt securities of such
new Subsidiary which are owned by any Company (other than any Excluded
Subsidiary or any Foreign Subsidiary) and required to be pledged pursuant to the
Security Agreement (it being understood that no Company shall be required to
pledge the voting Equity Interests of any Foreign Subsidiary other than the
voting Equity Interests of a "first tier" Foreign Subsidiary which do not
comprise more than 65% of the voting Equity Interests of such Foreign
Subsidiary), (II) deliver to Administrative Agent the certificates, if any,
representing such Equity Interests and debt securities, (A) in the case of such
Equity Interests, together with undated stock powers endorsed in blank, and (B)
in the case of such debt securities, endorsed in blank or together with
instruments of transfer or assignment in blank, in each case executed and
delivered by a Responsible Officer of Borrower or such Subsidiary, as the case
may be, (III) cause such new Subsidiary (other than any Excluded Subsidiary or
any Foreign Subsidiary) to take such actions necessary or advisable (including
executing and delivering a Joinder Agreement) to grant to Administrative Agent
for the benefit of the Creditors a perfected first priority security interest in
the collateral described in the Security Agreement with respect to such new
Subsidiary, including the filing of Uniform Commercial Code financing statements
in such jurisdictions as may be required by the Security Agreement or by law or
as may be reasonably requested by Administrative Agent, and (IV) deliver to
Administrative Agent all legal opinions reasonably requested relating to the
matters described above, which opinions shall be in form and substance, and from
counsel, reasonably satisfactory to Administrative Agent.
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9.21. Customer Rental Agreements. The Companies agree to use all
--------------------------
commercially reasonable efforts to ensure that each rental and/or lease
agreement used in connection with the lease or rent of the Rental Assets to
their customers contains provisions permitting the Companies to assign their
rights and obligations thereunder to Administrative Agent on behalf of the
Creditors and does not contain provisions that allow such customers to terminate
their obligations thereunder upon any actual or threatened insolvency of any
Company.
Section 10. Events of Default. If one or more of the following
-----------------
events (herein called "Events of Default") shall occur and be continuing:
-----------------
(a) (i) Borrower shall default in the payment when due (whether at
stated maturity upon prepayment or repayment or acceleration or otherwise)
of any principal of any Loan or Reimbursement Obligation, or (ii) Borrower
shall default in the payment when due of interest on any Loan or any
Reimbursement Obligation or any fee or any other amount payable by it
hereunder or under any other Credit Document when due and such default
under this clause (ii) shall have continued unremedied for three or more
Business Days; or
(b) (i) Any Company shall default in the payment when due of any
principal of or interest on any of its Indebtedness (other than the Loans)
aggregating $7,500,000 or more, beyond the period of grace, if any,
provided in the instrument or agreement under which such Indebtedness was
created, after giving effect to any consents or waivers relating thereto
obtained before the expiration of any such period of grace; or (ii) any
Company fails to perform or observe any other term, condition or covenant,
or any other event shall occur or condition exist under any note,
agreement, indenture or other document evidencing or relating to any
Indebtedness aggregating $7,500,000 or more if the effect of such event
(after giving effect to any consents or waivers relating thereto) is to
cause, or to permit the holder or holders of such Indebtedness (or a
trustee or agent on behalf of such holder or holders) to cause (without
further notice or passage of time), such Indebtedness to become due, or to
be prepaid in full (whether by redemption, purchase, offer to purchase or
otherwise), prior to its stated maturity, provided, however, that this
-------- -------
subsection (ii) shall not apply to secured Indebtedness that becomes due as
a result of the voluntary sale or transfer of the property or assets
securing such Indebtedness; or
(c) Any representation or warranty made or deemed made in any Credit
Document (or in any modification or supplement thereto) by any Company or
in any certificate furnished to any Creditor pursuant to the provisions
thereof, shall prove to have been incorrect, false or misleading in any
material respect as of the time made, deemed made or furnished; or
(d) Any Obligor shall default in the performance of any of its
obligations under any of Sections 9.01(f), 9.05 through 9.11, 9.15 or 9.17
through 9.20; or any Obligor shall default in the performance of any of its
other obligations in this Agreement, the Security Documents or the L/C
Documents and such default shall continue unremedied for a period of at
least thirty days after written notice thereof to such Obligor and Borrower
by Administrative Agent or the Majority Lenders; or
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(e) Any Company (other than an Excluded Subsidiary) shall not, or
shall admit in writing its inability to, or be generally unable to, pay its
debts as such debts become due; or
(f) Any Company (other than an Excluded Subsidiary) shall (i) apply
for or consent to the appointment of, or the taking of possession by, a
receiver, custodian, trustee or liquidator of itself or of all or a
substantial part of its Property, (ii) make a general assignment for the
benefit of its creditors, (iii) commence or consent to any Insolvency
Proceeding with respect to itself, (iv) file a petition seeking to take
advantage of any other law relating to bankruptcy, insolvency,
reorganization, winding-up, or composition or readjustment of debts, (v)
fail to controvert within 60 days, or acquiesce in writing to, any petition
filed against it in an involuntary Insolvency Proceeding, or (vi) take any
corporate action for the purpose of effecting any of the foregoing; or
(g) Any Insolvency Proceeding is commenced or filed against any
Company (other than an Excluded Subsidiary), or and either (1) such
proceeding or petition shall not be dismissed, within 60 days after
commencement, filing or levy or (2) such proceeding shall not be actively
contested by such Company; (ii) any Company (other than an Excluded
Subsidiary) admits the material allegations of a petition against it in any
Insolvency Proceeding, or an order for relief (or similar order under non-
U.S. law) is ordered in any Insolvency Proceeding; or (iii) any Company
(other than an Excluded Subsidiary) acquiesces in the appointment of a
receiver, receiver and manager, trustee, custodian, conservator,
liquidator, mortgagee in possession (or agent therefor), or other similar
person for itself or a substantial portion of its Property or business; or
(h) A final judgment or judgments for the payment of money in excess
of $7,500,000 in the aggregate (exclusive of judgment amounts to the extent
covered by insurance) shall be rendered by one or more courts,
administrative tribunals or other bodies having jurisdiction against any
Company (other than an Excluded Subsidiary) and the same shall not be
discharged (or provision which results in a stay of execution shall not be
made for such discharge), vacated or bonded pending appeal, or a stay of
execution thereof shall not be procured, within 60 days from the date of
entry thereof and such Company shall not, within said period of 60 days, or
such longer period during which execution of the same shall have been
stayed, appeal therefrom and cause the execution thereof to be stayed
during such appeal; or
(i) An ERISA Event or noncompliance with respect to Foreign Plans
shall have occurred that when taken together with all other ERISA Events
and noncompliance with respect to Foreign Plans that have occurred, is
reasonably likely to result in liability of any Company in an aggregate
amount exceeding $7,500,000; or
(j) Any Change of Control shall occur; or
(k) Any Security Document after delivery thereof by any Obligor at
any time shall cease to be in full force and effect, or cease to give
Administrative Agent the Liens, rights, powers and privileges purported to
be created thereby with respect to a material portion of the Collateral, in
favor of Administrative Agent on behalf of the Creditors, superior to and
prior
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to the rights of all third Persons except as expressly permitted by
the applicable Security Document or any Company fails to comply with or to
perform any material obligation or agreement under any Security Document
within ten days after being requested by Administrative Agent or any
Lender; or
(l) Any Guarantee ceases to be in full force and effect (other than
in connection with the release thereof authorized by Section 9.06) or any
of the Guarantors repudiates, or attempts to repudiate, any of its
obligation under any of the Guarantees; or
(m) Any Credit Document or any material provision thereof shall at
any time and for any reason be declared by a court of competent
jurisdiction to be null and void, or a Proceeding shall be commenced by any
Company seeking to establish the invalidity or unenforceability thereof
(exclusive of questions of interpretation of any provision thereof), or any
Qualified Company shall repudiate or deny in writing that it has any
liability or obligation for the payment of principal or interest or other
obligations purported to be created under any Credit Document; or
(n) Any non-monetary judgment, order or decree is entered against any
Company which has a Material Adverse Effect, and there shall be any period
of 60 consecutive days during which a stay of enforcement of such judgment
or order, by reason of a pending appeal or otherwise, shall not be in
effect;
THEREUPON: (1) in the case of an Event of Default other than one referred to in
clause (f) or (g) of this Section 10 with respect to the Borrower,
Administrative Agent may, and upon written direction of the Majority Lenders
shall, by notice to Borrower, terminate the Commitments and/or declare the
principal amount then outstanding of, and the accrued interest on, the Loans,
the Reimbursement Obligations and all other amounts payable by Borrower
hereunder and under the Notes (including any amounts payable under Section 5.05
or 5.06) to be forthwith due and payable, whereupon such amounts shall be
immediately due and payable without presentment, demand, protest or other
formalities of any kind, all of which are hereby expressly waived by Borrower,
reduce any claim to judgment, take any other action permitted by law and/or take
any action permitted to be taken by the Security Documents during the existence
of an Event of Default; and (2) in the case of the occurrence of an Event of
Default referred to in clause (f) or (g) of this Section 10 with respect to the
Borrower, the Commitments shall automatically be terminated and the principal
amount then outstanding of, and the accrued interest on, the Loans, the
Reimbursement Obligations and all other amounts payable by Borrower hereunder
and under the Notes (including any amounts payable under Section 5.05 or 5.06)
shall automatically become immediately due and payable without presentment,
demand, protest or other formalities of any kind, all of which are hereby
expressly waived by each Obligor.
In addition, Borrower agrees, that upon the occurrence and during the
continuance of any Event of Default it shall, if requested by Administrative
Agent or the Majority Revolving Lenders through Administrative Agent (and, in
the case of any Event of Default referred to in clause (e), (f) or (g) of this
Section 10 with respect to the Borrower, forthwith, without any demand or the
taking of any other action by Administrative Agent or such Lenders) provide
cover for the L/C Liabilities by paying to Administrative Agent immediately
available funds in an amount equal to the then aggregate
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undrawn available amount of all Letters of Credit, which funds shall be held by
Administrative Agent in the Collateral Account as collateral security in the
first instance for the L/C Liabilities and be subject to withdrawal only as
provided in the Security Agreement.
Section 11. Agents.
------
11.01. General Provisions. Each of the Lenders, Agents and L/C
------------------
Lenders hereby irrevocably appoints Administrative Agent as its agent and
authorizes Administrative Agent to take such actions on its behalf and to
exercise such powers as are delegated to Administrative Agent by the terms
hereof and of the Security Documents, together with such actions and powers as
are reasonably incidental thereto. Administrative Agent agrees to give promptly
to each Lender a copy of each notice or other document received by it pursuant
to any Credit Document (other than any that are required to be delivered to the
Lenders by any Obligor).
Each Lender or other financial institution serving as an Agent
hereunder shall have the same rights and powers in its capacity as a Lender as
any other Lender and may exercise the same as though it were not such Agent, and
such Lender or other financial institution and its Affiliates may accept
deposits from, lend money to and generally engage in any kind of business with
any Company or Affiliate thereof as if it were not such Agent hereunder.
Notwithstanding any provision to the contrary elsewhere in this
Agreement, (A) the Lead Arranger and the Syndication Agent shall not have any
duties or obligations, except as expressly set forth herein, or any fiduciary
relationship with any Lender and no implied covenants, functions,
responsibilities, duties, obligations or liabilities shall be read into this
Agreement or any of the Transaction Documents or otherwise exist against the
Lead Arranger or Syndication Agent and (B) Administrative Agent shall not have
any duties or obligations, except those expressly set forth herein, or any
fiduciary relationship with any Lender, and no implied covenants, functions,
responsibilities, duties, obligations or liabilities shall be read into this
Agreement or any of the Transaction Documents or otherwise exist against
Administrative Agent. Without limiting the generality of the foregoing, (a) no
Agent shall be subject to any fiduciary or other implied duties, regardless of
whether a Default has occurred and is continuing, (b) no Agent shall have any
duty to take any discretionary action or exercise any discretionary powers,
except discretionary rights and powers expressly contemplated hereby that such
Agent is required to exercise in writing by the Majority Lenders (or such other
number or percentage of the Lenders as shall be required by Section 12.04), and
(c) except as expressly set forth herein, no Agent shall have any duty to
disclose, and shall not be liable for the failure to disclose, any information
relating to any Company that is communicated to or obtained by the financial
institution serving as such Agent or any of its Affiliates in any capacity. No
Agent shall be liable for any action taken or not taken by it with the consent
or at the request of the Majority Lenders (or such other number or percentage of
the Lenders as shall be required by Section 12.04) or in the absence of its own
gross negligence or willful misconduct. No Agent shall be deemed to have
knowledge of any Default unless and until written notice thereof is given to
Administrative Agent and such Agent by Borrower or a Lender, and no Agent shall
be responsible for or have any duty to ascertain or inquire into (i) any
statement, warranty or representation made in or in connection with any Credit
Document, (ii) the contents of any certificate, report or other document
delivered hereunder or under any other Credit Document or in connection
herewith, (iii) the performance or observance of
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any of the covenants, agreements or other terms or conditions set forth herein,
(iv) the validity, enforceability, effectiveness or genuineness of any Credit
Document or any other agreement, instrument or document, (v) the satisfaction of
any condition set forth in Section 7 or elsewhere herein, other than (A) to
confirm receipt of items expressly required to be delivered to such Agent or (B)
to make a determination that any condition precedent set forth in Section 7 that
is to be to such Agent's satisfaction is satisfied.
Each Agent shall be entitled to rely upon, and shall not incur any
liability for relying upon, any notice, request, certificate, consent,
statement, instrument, document or other writing believed by it to be genuine
and to have been signed or sent by the proper Person. Each Agent also may rely
upon any statement made to it orally or by telephone and believed by it to be
made by the proper Person, and shall not incur any liability for relying
thereon. Each Agent may consult with legal counsel (who may be counsel for
Borrower), independent accountants and other experts selected by it, and shall
not be liable for any action taken or not taken by it in accordance with the
advice of any such counsel, accountants or experts. Each Agent may deem and
treat the Person in whose name any Note is registered on the Register as the
owner thereof for all purposes. Each Agent shall be fully justified in failing
or refusing to take any action under any Credit Document unless it shall first
receive such advice or concurrence of the Majority Lenders (or, if so specified
by this Agreement, all Lenders or such other number or percentage of the Lenders
as shall be required by Section 12.04) as it deems appropriate or it shall first
be indemnified to its satisfaction by the Lenders against any and all liability
and expense which may be incurred by it by reason of taking or continuing to
take any such action (it being understood that this provision shall not release
Administrative Agent from performing any action with respect to Borrower
expressly required to be performed by it pursuant to the terms hereof) under
this Agreement. Each Agent shall in all cases be fully protected in acting, or
in refraining from acting, under any Credit Document in accordance with a
request of the Majority Lenders (or, if so specified by this Agreement, all
Lenders), and such request and any action taken or failure to act pursuant
thereto shall be binding upon all the Lenders and all future holders of the
Loans.
Each Agent may perform any and all of its duties and exercise its
rights and powers by or through any one or more sub-agents appointed by such
Agent. Each Agent and any such sub-agent may perform any and all of its duties
and exercise its rights and powers through their respective Affiliates,
directors, officers, employees, agents and advisors ("Related Parties"). The
---------------
exculpatory provisions of the preceding paragraphs shall apply to any such sub-
agent and to the Related Parties of each Agent and any such sub-agent, and shall
apply to their respective activities in connection with the syndication of the
credit facilities provided for herein as well as activities of such Agent.
Subject to the appointment and acceptance of a successor Agent as
provided in this paragraph, any Agent may resign at any time by notifying the
Lenders, the L/C Lenders (with respect to Administrative Agent only) and
Borrower. Upon any such resignation, the Majority Lenders shall have the right
to appoint a successor which, so long as no Event of Default is continuing,
shall be reasonably acceptable to Borrower. If no successor shall have been so
appointed by the Majority Lenders and shall have accepted such appointment
within 30 days after the retiring Agent gives notice of its resignation, then
the retiring Agent may, on behalf of the Lenders and the L/C Lenders, appoint a
successor Agent which shall be a Lender, an Affiliate of a Lender or a bank with
an office in New York, New York, or an Affiliate of any such bank which, so long
as no Event of Default is continuing,
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shall be reasonably acceptable to Borrower. Upon the acceptance of its
appointment as Agent hereunder by a successor, such successor shall succeed to
and become vested with all the rights, powers, privileges and duties of the
retiring Agent, and the retiring Agent shall be discharged from its duties and
obligations hereunder. The fees payable by Borrower to a successor Agent shall
be the same as those payable to its predecessor unless otherwise agreed between
Borrower and such successor. After an Agent's resignation hereunder, the
provisions of this Section 11 shall continue in effect for the benefit of such
retiring Agent, its sub-agents and their respective Related Parties in respect
of any actions taken or omitted to be taken by any of them while it was acting
as such Agent.
Each Lender acknowledges that it has, independently and without
reliance upon any Agent or any other Lender and based on such documents and
information as it has deemed appropriate, made its own credit analysis and
decision to enter into this Agreement. Each Lender also acknowledges that it
will, independently and without reliance upon any Agent or any other Lender and
based on such documents and information as it shall from time to time deem
appropriate, continue to make its own decisions in taking or not taking action
under or based upon this Agreement, any related agreement or any document
furnished hereunder or thereunder. No Agent shall be deemed a trustee or other
fiduciary on behalf of any party.
11.02. Indemnification. Each Lender agrees to indemnify and hold
---------------
harmless each Agent (to the extent not reimbursed under Section 12.03, but
without limiting the obligations of any Obligor under Section 12.03), ratably in
accordance with the aggregate principal amount of the respective Commitments of
and/or Loans and Reimbursement Obligations held by the Lenders (or, if all of
the Commitments shall have been terminated or expired, ratably in accordance
with the aggregate outstanding amount of the Loans and Reimbursement Obligations
held by the Lenders), for any and all liabilities (including pursuant to any
Environmental Law), obligations, losses, damages, penalties, actions, judgments,
deficiencies, suits, costs, expenses (including reasonable attorney's fees) or
disbursements of any kind and nature whatsoever that may be imposed on, incurred
by or asserted against such Agent (including by any Lender) arising out of or by
reason of any investigation in or in any way relating to or arising out of any
Credit Document or any other documents contemplated by or referred to therein
for any action taken or omitted to be taken by such Agent under or in respect of
any of the Credit Documents or other such documents or the transactions
contemplated thereby (including the costs and expenses that the Obligors are
obligated to pay under Section 12.03, [and including also any payments under any
indemnity granted pursuant to Section 18 of the Security Agreement, or to any
Financial Intermediary referred to in Section 9 of the Security Agreement to
which remittances in respect of Receivables, as defined in the Security
Agreement, are to be made] but excluding, unless an Event of Default has
occurred and is continuing, normal administrative costs and expenses incident to
the performance of its agency duties hereunder) or the enforcement of any of the
terms hereof or thereof or of any such other documents; provided, however, that
-------- -------
no Lender shall be liable for any of the foregoing to the extent resulting from
the gross negligence, bad faith or willful misconduct of the party to be
indemnified. The agreements set forth in this Section 11.02 shall survive the
payment of all Loans and other obligations hereunder and shall be in addition to
and not in lieu of any other indemnification agreements contained in any other
Credit Document.
11.03. Consents Under Other Credit Documents. Except as otherwise
-------------------------------------
provided in the Credit Documents, Administrative Agent may, with the prior
consent of the Majority Lenders (but
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not otherwise), consent to any modification, supplement or waiver under any of
the other Credit Documents.
11.04. Collateral Sub-Agents. Each Lender by its execution and
---------------------
delivery of this Agreement agrees, [as contemplated by Section 9(g) of the
Security Agreement,] that, in the event it shall hold any Cash Equivalents
referred to therein, upon the written request of Administrative Agent following
the occurrence and during the continuance of an Event of Default and the
execution and delivery by Administrative Agent, such Lender and the applicable
Obligor of a mutually acceptable control agreement with respect to such Cash
Equivalent (it being understood that no Lender is obligated to enter into any
such control agreement), such Cash Equivalents shall be held in the name and
under the control of such Lender, and such Lender shall hold such Cash
Equivalents as a collateral sub-agent for Administrative Agent thereunder. Each
Obligor by its execution and delivery of this Agreement hereby consents to the
foregoing. In such event, such Lender acting in the capacity of a sub-agent
shall be afforded all protections set forth in Section 11 as if acting as
Administrative Agent with respect to such holdings. Notwithstanding anything in
this Agreement or any other Credit Document to the contrary, except as set forth
in Section 4.07 hereof, no Lender (other than Administrative Agent acting in
such capacity) which is acting as a Financial Intermediary (as defined in the
Security Agreement) with respect to any Financial Account Collateral (as defined
in the Security Agreement) shall have any duty or obligation (whether express or
implied) to the other Lenders in respect of such Financial Account Collateral or
the disposition thereof unless such Lender, Administrative Agent and the
applicable Obligor have entered into a Financial Account Consent Agreement (as
defined in the Security Agreement) or other control or similar agreement with
respect to such Financial Account Collateral (it being understood that no Lender
shall have any obligation to enter into any such agreement).
Section 12. Miscellaneous.
-------------
12.01. Waiver. No failure on the part of any Creditor to exercise
------
and no delay in exercising, and no course of dealing with respect to, any right,
power or privilege under any Credit Document shall operate as a waiver thereof,
nor shall any single or partial exercise of any right, power or privilege under
any Credit Document preclude any other or further exercise thereof or the
exercise of any other right, power or privilege. The remedies provided herein
are cumulative and not exclusive of any remedies provided by law.
12.02. Notices. All notices, requests and other communications
-------
provided for herein and under the Security Documents (including any
modifications of, or waivers, requests or consents under, this Agreement) shall,
except to the extent otherwise expressly provided herein or therein, be given or
made in writing (including by facsimile) delivered to the intended recipient at
the "Address for Notices" specified below its name on the signature pages hereof
(or with respect to any Guarantor, as so specified for Borrower) or, as to any
party, at such other address as shall be designated by such party in a notice to
each other party. Except as otherwise provided in this Agreement, all such
communications shall be deemed to have been duly given when transmitted by
facsimile or personally delivered or, in the case of a mailed notice, upon
receipt, in each case given or addressed as aforesaid. Any Notice of Borrowing
or Notice of Continuation/Conversion shall be deemed to have been received when
actually received.
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12.03. Expenses, Indemnification, Etc. (a) Borrower agrees,
------------------------------
subject to Section 7 of the Commitment Letter, to pay or reimburse:
(i) subject to the limitations contained in the Commitment Letter,
Agents for all of their reasonable out-of-pocket costs and expenses
(including the reasonable fees and expenses of Xxxxxx Xxxxxx & Xxxxxxx or
single other counsel to Agents selected by Agents in place of Xxxxxx Xxxxxx
and Xxxxxxx (and all local counsel reasonably deemed necessary by Agents))
in connection with (1) the negotiation, preparation, execution and delivery
of the Credit Documents and the extension of credit hereunder, (2) the
negotiation or preparation of any modification, supplement or waiver of any
of the terms of any Credit Document (whether or not consummated or
effective) and (3) the syndication of the Loans and Commitments;
(ii) each Creditor for all reasonable out-of-pocket costs and
expenses of such Creditor (including the reasonable fees and expenses of
external legal counsel) in connection with (1) any enforcement or
collection proceedings resulting from any Event of Default, including all
manner of participation in or other involvement with (x) bankruptcy,
insolvency, receivership, foreclosure, winding up or liquidation
proceedings, (y) judicial or regulatory proceedings and (z) workout,
restructuring or other similar negotiations or proceedings (whether or not
the workout, restructuring or similar transaction contemplated thereby is
consummated), (2) the enforcement of this Section 12.03 and (3) any
documentary taxes; and
(iii) Administrative Agent for all reasonable costs, expenses,
taxes, assessments and other charges (including reasonable fees and
disbursements of counsel) incurred in connection with (1) any filing,
registration, recording or perfection of any security interest contemplated
by any Credit Document or any other document referred to therein or (2) the
custody or preservation of, or the sale of, collection from, or other
realization upon, any of the Collateral.
(b) Borrower hereby agrees to indemnify each Creditor and its
respective Affiliates, directors, trustees, officers, employees and agents
(each, an "Indemnitee") from, and hold each of them harmless against any and all
----------
Losses incurred by any of them (including any and all Losses incurred by any
Agent or L/C Lender to any Lender, whether or not any Creditor is a party
thereto) directly or indirectly arising out of or by reason of or relating to
any Proceeding arising out of or relating to the negotiation, execution,
delivery, performance, administration or enforcement of any Credit Document, any
of the transactions contemplated by the Credit Documents (including the
Transactions), any breach by any Company of any representation, warranty,
covenant or other agreement contained in any Credit Document in connection with
any of the Transactions, the use or proposed use of any of the Loans or Letters
of Credit, the issuance of or performance under any Letter of Credit or the use
of any collateral security for the Loans (including the exercise by any Creditor
of the rights and remedies or any power of attorney with respect thereto and any
action or inaction in respect thereof), including all amounts payable by any
Lender pursuant to Section 11.02, but excluding any such Losses to the extent
finally determined by a court of competent jurisdiction to have arisen from the
gross negligence, bad faith or willful misconduct of the Indemnitee.
Without limiting the generality of the foregoing, Borrower, will
indemnify each Creditor and each other Indemnitee from, and hold each Creditor
and each other Indemnitee harmless
-102-
against, any Losses described in the preceding sentence arising under any
Environmental Law as a result of (A) the past, present or future operations of
any Company (or any predecessor in interest to any Company), (B) the past,
present or future condition of any site or facility owned, operated, leased or
used at any time by any Company (or any such predecessor in interest), or (C)
any Release or threatened Release of any Hazardous Materials at, on, under or
from any such site or facility, excluding any such Release or threatened Release
that shall occur during any period when any Creditor shall be in possession of
any such site or facility following the exercise by such Creditor of any of its
rights and remedies hereunder or under any of the Security Documents; provided,
--------
however, that the indemnity hereunder shall be subject to the exclusions from
-------
indemnification set forth in the preceding sentence.
To the extent that the undertaking to indemnify and hold harmless set
forth in this Section 12.03 or any other provision of any Credit Document
providing for indemnification is unenforceable because it is violative of any
law or public policy or otherwise, Borrower shall contribute the maximum portion
that it is permitted to pay and satisfy under applicable law to the payment and
satisfaction of all indemnified liabilities incurred by any of the Persons
indemnified hereunder.
The Obligors agree, to the fullest extent permitted under applicable
law, that no Indemnitee shall have any liability (whether direct or indirect, in
contract or tort or otherwise) for any Losses to any Obligor or any Obligor's
security holders or creditors resulting from, arising out of, in any way related
to or by reason of any matter referred to in any indemnification or expense
reimbursement provisions set forth in any Credit Document, except to the extent
that any Loss is determined by a court of competent jurisdiction in a final
nonappealable judgment to have resulted from the gross negligence, bad faith or
willful misconduct of such Indemnitee.
The Obligors agree that, without the prior written consent of
Administrative Agent, Syndication Agent and the Majority Lenders which consent
shall not be unreasonably withheld, no Obligor will settle, compromise or
consent to the entry of any judgment in any pending or threatened Proceeding in
respect of which indemnification is reasonably likely to be sought under the
indemnification provisions of this Section 12.03 (whether or not any Indemnitee
is an actual or potential party to such Proceeding), unless such settlement,
compromise or consent includes an unconditional written release of each
Indemnitee from all liability arising out of such Proceeding and does not
include any statement as to an admission of fault, culpability or failure to act
by or on behalf of any Indemnitee and does not involve any payment of money or
other value by any Indemnitee or any injunctive relief or factual findings or
stipulations binding on any Indemnitee.
12.04. Amendments, Etc. (i) No provision of any Credit Document
---------------
may be amended, modified or supplemented except by an instrument in writing
signed by the Obligors party thereto and the Majority Lenders, or by the
Obligors party thereto and Administrative Agent acting with the written consent
of the Majority Lenders, and no provision of any Credit Document may be waived
except by an instrument in writing signed by the Obligors party thereto and the
Majority Lenders, or by the Obligors party thereto and Administrative Agent
acting with the written consent of the Majority Lenders; provided, however,
-------- -------
that:
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(a) no amendment, modification, supplement or waiver shall, unless by
an instrument signed by each Lender or by Administrative Agent acting with
the written consent of each Lender (or signed by, or with the consent of,
each Lender having an Obligation directly affected thereby, in the case of
clauses (I), (II) or (III) (it being understood that the consent of no
other Lender or Agent is needed in each such case)): (I) extend the
scheduled final maturity of any Loan or Note, or extend the expiration date
of any Letter of Credit beyond the R/C Termination Date, or reduce the rate
of interest (other than any waiver of any increase in the interest rate
applicable to any of the Loans pursuant to clause (b) of Section 3.02) or
fees thereon, or extend the time of payment of interest or fees thereon
(other than in connection with the extension of any scheduled payment
hereunder otherwise permitted hereby), or reduce the principal amount
thereof, or make any change to the definition of Applicable Margin or
Applicable Revolving Credit Fee Percentage (or Schedule 1.01(a), (b) or
---------------- ---
(c)) if the effect thereof would be to reduce the rate of interest or any
---
fee applicable to any Loan or Commitment from that previously in effect (it
being understood that any increase in the rate of interest or fee
applicable to any Loan or Commitment only requires the consent of the
Majority Lenders), or reduce the Reimbursement Obligation in respect of any
Letter of Credit, (II) extend the final maturity of any of the Commitments
or amend Section 2.04(a), (III) change the currency in which any Obligation
is payable, (IV) amend the terms of this Section 12.04, the exception
contained in the first sentence of Section 12.05(a), Section 4.02, 4.07 or
11.03, (V) reduce the percentages specified in the definition of the term
"Majority Lenders" or amend any provision of any Credit Document requiring
the consent of all the Lenders or reduce any other percentage of the
Lenders required to make any determinations or waive any rights hereunder
or to modify any provision hereof (it being understood, however, that only
the consent of the Lenders included in such percentage need be obtained),
(VI) release any Guarantors whose aggregate assets as of the last day of
the most recent fiscal period for which financial statements shall have
been delivered shall exceed 5% of the consolidated assets of the Companies
as of such date or whose aggregate revenue for the period of four fiscal
quarters ending on such day shall exceed 5% of the consolidated revenue of
the Companies for such period from its obligations under Section 6 (unless
permitted by this Agreement), (VII) consent to the assignment or transfer
by any Obligor of any of its rights and obligations under any Credit
Document (except that in a transaction permitted by Section 9.06 resulting
in any Obligor (except Borrower) assigning its rights and obligations under
the Credit Documents to any other Obligor no consent of any Lender or Agent
need be obtained) or (VIII) release all or substantially all of the
Collateral or terminate the Lien under any Credit Document in respect of
all or substantially all of the Collateral (except as permitted by the
Credit Documents);
(b) no such amendment or waiver shall increase the Commitments of any
Lender over the amount thereof then in effect without the consent of such
Lender (it being understood that amendments or waivers of conditions
precedent, covenants or Defaults shall not constitute an increase of the
Commitment of any Lender);
(c) any modification or supplement of or waiver with respect to
Section 11 which affects any Agent in its capacity as such shall require
the consent of such Agent;
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(d) no consent of any Lender need be obtained, and Administrative
Agent is hereby authorized, to release any Lien securing the Obligations on
Property which is the subject of any disposition permitted by the Credit
Documents and to release any Guarantee of a Subsidiary upon the sale of all
of the Equity Interests of such Subsidiary in accordance with the Credit
Documents;
(e) subject to clause (a)(I) of this proviso to this Section
12.04(i), the consent of Lenders holding not less than a majority of the
then outstanding Loans under the Term B Facility (but no other Lender or
Agent) shall be required with respect to any extension of any scheduled
Amortization Payment or any reduction in the amount of any scheduled
Amortization Payment;
(f) no modification, supplement or waiver shall alter the provisions
of the first paragraph of Section 2.10(b) in a manner that would reduce the
proportion of any prepayment under Section 2.10(a) to be allocated to any
Tranche or the order of application between the Tranches or the order of
application to Loans within a Tranche, in each case without the consent of
the Requisite Tranche Lenders of the Tranche proposed to be allocated a
lesser prepayment or to have its order of priority changed or have the
order of application within such Tranche changed as a result thereof (it
being understood that the increase of any Tranche or the addition of a new
tranche of credit that is afforded substantially the same rights under
Section 2.10(b) as the Tranches of the same type are then treated under
Section 2.10(b) shall only require the consent of the Majority Lenders);
(g) no reduction of the percentage specified in the definition of
"Majority Revolving Lenders" shall be made without the consent of each
Revolving Lender (it being understood that no consent of any other Lender
or Agent is needed);
(h) no reduction of the percentage specified in any subclause of the
definition of "Requisite Tranche Lenders" shall be made without the consent
of each Lender of the Tranche contemplated by such subclause (it being
understood that no consent of any other Lender or Agent is needed);
(i) no amendment or waiver shall affect the rights or duties of any
L/C Lender in its capacity as such or alter the obligation of any Revolving
Lender pursuant to Section 2.03(e) or 2.03(f) without the consent of such
L/C Lender;
(j) no consent of any Lender need be obtained to effect any amendment
of any Credit Document necessary to comply with Section 9.12 or Section
9.20; and
(k) no amendment or waiver shall make any change to Section 2.01(d)
or the definitions of "Swing Loan Commitment," "R/C Termination Date" or
"Swing Loans" or the "Swing Loan Notes" without the consent of the Swing
Loan Lender.
(ii) If, in connection with any proposed change, waiver, discharge or
termination to any of the provisions of this Agreement as contemplated by
Section 12.04(i)(a), the consent of the
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Majority Lenders is obtained but the consent of one or more of such other
Lenders whose consent is required is not obtained, then Borrower shall have the
right to replace one or more of such non-consenting Lender or Lenders (so long
as all non-consenting Lenders are so replaced) with one or more Replacement
Lenders pursuant to Section 2.11 so long as at the time of such replacement each
such Replacement Lender consents to the proposed change, waiver, discharge or
termination.
(iii) Notwithstanding anything herein to the contrary, (A) with the
consent of the Majority Lenders, other additional commitments and extensions of
credit pursuant to this Agreement may be included in the determination of the
Majority Lenders, Majority Revolving Lenders and Requisite Tranche Lenders
without notice to or consent of any other Lender or Agent on substantially the
same basis as the Commitments (and related extensions of credit) are included on
the Effective Date, and (B) it is agreed and understood that, subject to clause
(f) of Section 12.04(i), any prepayment required by Section 2.10 may be
modified, supplemented or waived by the Majority Lenders.
(iv) In the case of any waiver, the Obligors, the Lenders and
Administrative Agent shall be restored to their former position and rights
hereunder and under the other Transaction Documents, and any Default or Event of
Default waived shall be deemed to be cured and not continuing; but no such
waiver shall extend to any subsequent or other Default or Event of Default, or
impair any right consequent thereon.
12.05. Successors and Assigns. (a) The provisions of this Agreement
----------------------
shall be binding upon and inure to the benefit of the parties hereto and the
Agents and their respective successors and assigns permitted hereby, except that
no Obligor may assign or otherwise transfer any of its rights or obligations
hereunder without the prior written consent of each Lender (and any attempted
assignment or transfer by any Obligor without such consent shall be null and
void). Nothing in this Agreement, expressed or implied, shall be construed to
confer upon any Person (other than the parties hereto, the Agents their
respective successors and assigns permitted hereby and, to the extent expressly
contemplated hereby, the Affiliates of each of Administrative Agent and the
Lenders and, to the extent expressly contemplated by Section 12.03(b), the
Indemnitees) any legal or equitable right, remedy or claim under or by reason of
this Agreement. It is expressly acknowledged and agreed that each Agent that is
not a party to this Agreement in its capacity as such is a third party
beneficiary hereto to the extent of the rights of such Agent set forth herein.
(b) Any Lender may, with the written consent of Administrative Agent,
the Lead Arranger and, unless an Event of Default shall have occurred and be
continuing, Borrower (which consent (x) shall not be unreasonably withheld or
delayed and (y) shall not be required in the case of an assignment to a Lender
or an Affiliate of a Lender or an Approved Fund with respect to a Lender or in
connection with a transfer of all or substantially all of the assets of a
Lender), assign to one or more Eligible Assignees all or a portion of its rights
and obligations under this Agreement (including all or a portion of its
Commitment and the Loans at the time owing to it); provided that (i) except in
--------
the case of an assignment of the entire remaining amount of the assigning
Lender's Commitment and the Loans at the time owing to it or in the case of an
assignment to a Lender or an Affiliate of a Lender or an Approved Fund with
respect to a Lender, the aggregate amount of the Commitment (which for this
purpose includes Loans outstanding thereunder) or principal outstanding balance
of the Loans of the assigning Lender subject to each such assignment, and, if
such assigning Lender shall be assigning
-106-
less than all of its Commitments and Loans pursuant to such assignment, the
aggregate amount of the Commitments and principal outstanding balance of Loans
retained by such assigning Lender (determined in each case as of the date the
Assignment and Acceptance with respect to such assignment is delivered to
Administrative Agent) shall not be less than $1,000,000, unless each of
Administrative Agent, the Lead Arranger and Borrower otherwise consent, (ii)
each partial assignment shall be made as an assignment of a proportionate part
of all the assigning Lender's rights and obligations under this Agreement with
respect to the Loan or the Commitment assigned, except that this clause (ii)
shall not prohibit any Lender from assigning all or a portion of its rights and
obligations among Term B Facility Loans and Revolving Loans on a non-pro rata
--- --- ----
basis, and (iii) the parties to each assignment shall execute and deliver to
Administrative Agent and the Lead Arranger an Assignment and Acceptance,
together (other than in the case of any assignment by Xxxxxxx Xxxxx Capital
Corporation or any of its Affiliates) with a processing and recordation fee of
$2,000 and the Eligible Assignee, if it shall not be a Lender, shall deliver to
Administrative Agent and the Lead Arranger information it may reasonably
require. Subject to acceptance and recording thereof by Administrative Agent
pursuant to paragraph (c) of this Section, from and after the effective date
specified in each Notice of Assignment, the Eligible Assignee thereunder shall
be a party hereto and, to the extent of the interest assigned by such Notice of
Assignment have the rights and obligations of a Lender under this Agreement, and
the assigning Lender thereunder shall, to the extent of the interest assigned by
such Notice of Assignment, be released from its obligations under this Agreement
(and, in the case of a Notice of Assignment covering all of the assigning
Lender's rights and obligations under this Agreement, such Lender shall cease to
be a party hereto but shall continue to be entitled to the benefits of Section
12.06). Any assignment or transfer by a Lender of rights or obligations under
this Agreement that does not comply with this paragraph shall be treated for
purposes of this Agreement as a sale by such lender of a participation in such
rights and obligations in accordance with paragraph (d) of this Section.
(c) Administrative Agent, acting solely for this purpose as an agent
of Borrower, shall maintain at one of its offices in Glastonbury, Connecticut, a
copy of each Notice of Assignment delivered to it and a register for the
recordation of the names and addresses of the Lenders, and the Commitments of,
and principal amount of the Loans owing to, each Lender pursuant to the terms
hereof from time to time (the "Register"). The entries in the Register shall be
--------
conclusive, and Borrower, Administrative Agent and the Lenders may treat each
Person whose name is recorded in the Register pursuant to the terms hereof as a
Lender hereunder for all purposes of this Agreement, notwithstanding notice to
the contrary. The Register shall be available for inspection by Borrower and
any Lender, at any reasonable time and from time to time upon reasonable prior
notice.
(d) Any Lender may, without the consent of, or notice to Borrower or
Administrative Agent, sell participations to one or more banks or other entities
(a "Participant") in all or a portion of such Lender's rights and/or obligations
-----------
under this Agreement (including all or a portion of its Commitment and/or the
Loans owing to it); provided that (i) such Lender's obligations under this
--------
Agreement shall remain unchanged, (ii) such Lender shall remain solely
responsible to the other parties hereto for the performance of such obligations
and (iii) Borrower, Administrative Agent and the other Lenders shall continue to
deal solely and directly with such Lender in connection with such Lender's
rights and obligations under this Agreement. Any agreement or instrument
pursuant to which a Lender sells such a participation shall provide that such
Lender shall retain the sole right to enforce this Agreement and to approve any
amendment, modification or waiver of any provision of this
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Agreement; provided that such agreement or instrument may provide that such
--------
Lender will not, without the consent of the Participant, agree to any amendment,
modification or waiver described in Section 12.04(i)(a)(I), (II), (III), (VI) or
(VIII) that affects such Participant. Subject to paragraph (e) of this Section,
Borrower agrees that each Participant shall be entitled to the benefits of
Section 5.01 to the same extent as if it were a Lender and had acquired its
interest by assignment pursuant to paragraph (b) of this Section. To the extent
permitted by law, each Participant also shall be entitled to the benefits of
Section 4.07 be subject to such Section 4.07 as though it were a Lender.
(e) A Participant shall not be entitled to receive any greater
payment under Section 5.01 or 5.06 than the applicable Lender would have been
entitled to receive with respect to the participation sold to such Participant,
unless the sale of the participation to such Participant is made with the
Borrower's prior written consent. A Participant that would be a Foreign Lender
if it were a Lender shall not be entitled to the benefits of Section 5.06 unless
Borrower is notified of the participation sold to such Participant and such
Participant agrees, for the benefit of Borrower, to comply with Section 5.06(b)
as though it were a Lender.
(f) Any Lender may at any time pledge or assign a security interest
in all or any portion of its rights under this Agreement to secure obligations
of such Lender, including without limitation any pledge or assignment to secure
obligations to a Federal Reserve Bank; provided that no such pledge or
--------
assignment of a security interest shall release a Lender from any of its
obligations hereunder or substitute any such pledgee or assignee for such Lender
as a party hereto.
12.06. Survival. The obligations of the Obligors under Sections
--------
5.01, 5.05, 5.06 and 12.03, the obligations of each Guarantor under Section 6.03
(unless such Guarantor shall have been released pursuant to Section 9.06 or with
the consent of the Majority Lenders (or, to the extent required pursuant to
Section 12.04, all of the Lenders)), and the obligations of the Lenders under
Sections 5.06 and 11.02, shall survive the repayment of the Loans and
Reimbursement Obligations and the termination of the Commitments and, in the
case of any Lender that may assign any interest in its Commitments, Loans or L/C
Interest hereunder, shall (to the extent relating to such time as it was a
Lender) survive the making of such assignment, notwithstanding that such
assigning Lender may cease to be a "Lender" hereunder. In addition, each
representation and warranty made, or deemed to be made by a notice of any
extension of credit, herein or pursuant hereto shall be considered to have been
relied upon by the other parties hereto and shall survive the execution and
delivery of this Agreement and the Notes, if any, and the making of any
extension of credit hereunder, regardless of any investigation made by any such
other party or on its behalf and notwithstanding that Administrative Agent or
any Lender may have had notice or knowledge of any Default or incorrect
representation or warranty.
12.07. Captions. The table of contents and captions and section
--------
headings appearing herein are included solely for convenience of reference and
are not intended to affect the interpretation of any provision of this
Agreement.
12.08. Counterparts; Interpretation; Effectiveness. This Agreement
-------------------------------------------
may be executed in counterparts (and by different parties hereto on different
counterparts), each of which shall constitute an original, but all of which when
taken together shall constitute a single contract. This Agree-
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ment, the Fee Letter and Administrative Agent's Fee Letter constitute the
entire contract among the parties hereto and thereto relating to the subject
matter hereof and supersede any and all previous agreements and understandings,
oral or written, relating to the subject matter hereof, other than the
confidentiality, waiver of jury trial and governing law provisions of the
Commitment Letter, the provisions of the second paragraph of Section 2 of the
Commitment Letter and the limitations contained in Section 7 of the Commitment
Letter, which are not superseded. Delivery of an executed counterpart of a
signature page of this Agreement by telecopy shall be effective as delivery of a
manually executed counterpart covered in Section 7.01 of this Agreement. Upon
the effectiveness of this Agreement, all commitments to provide any financing
pursuant to the Commitment Letter shall automatically and permanently terminate.
12.09. Governing Law; Submission to Jurisdiction; Waivers; Etc.
-------------------------------------------------------
(a) Each Credit Document shall be governed by, and construed in accordance
with, the law of the State of New York (including Sections 5-1401 and 5-1402 of
the General Obligations Law of the State of New York), without regard to
principles of conflicts of laws thereof not contained in such Sections 5-1401
and 5-1402 (except in the case of the other Credit Documents, to the extent
otherwise expressly stated therein). Each Obligor hereby irrevocably and
unconditionally: (I) submits for itself and its Property in any Proceeding
relating to any Credit Document to which it is a party, or for recognition and
enforcement of any judgment in respect thereof, to the non-exclusive general
jurisdiction of the Supreme Court of the State of New York sitting in New York
County, the courts of the United States of America for the Southern District of
New York, and appellate courts from any thereof; (II) consents that any such
Proceeding may be brought in any such court; (III) agrees that service of
process in any such Proceeding may be effected by mailing a copy thereof by
registered or certified mail (or any substantially similar form of mail),
postage prepaid, to Borrower at its address set forth on the signature page
hereto or at such other address of which Administrative Agent shall have been
notified pursuant thereto; and (V) agrees that nothing herein shall affect the
right to effect service of process in any other manner permitted by law or shall
limit the right to xxx in any other jurisdiction.
(b) EACH OBLIGOR, EACH AGENT AND EACH LENDER HEREBY IRREVOCABLY
WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY AND ALL RIGHTS TO
TRIAL BY JURY IN ANY LEGAL ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO
THIS AGREEMENT OR THE OTHER CREDIT DOCUMENTS OR THE TRANSACTIONS CONTEMPLATED
HEREBY AND FOR ANY COUNTERCLAIM THEREIN.
12.10. Confidentiality. Each Lender agrees to keep information
---------------
obtained by it pursuant to the Credit Documents confidential in accordance with
such Lender's customary practices and agrees that it will only use such
information in connection with the transactions contemplated hereby and not
disclose any of such information other than (a) to such Lender's employees,
representatives, directors, attorneys, auditors, agents, professional advisors,
trustees or affiliates who are advised of the confidential nature thereof or to
any direct or indirect contractual counterparty in swap agreements or such
contractual counterparty's professional advisor (so long as such contractual
counterparty or professional advisor to such contractual counterparty agrees to
be bound by the provision of this Section 12.10, such Lender being liable for
any breach of confidentiality by any Person described in this clause (a) and
with respect to disclosures to Affiliates to the extent disclosed by such Lender
to such
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Affiliate), (b) to the extent such information presently is or hereafter becomes
available to such Lender on a non-confidential basis from a Person not an
Affiliate of such Lender and not known to such Lender to be violating a
confidentiality obligation by such disclosure, (c) to the extent disclosure is
required by any Law, subpoena or judicial order or process (provided that notice
--------
of such requirement or order shall be promptly furnished to Borrower unless such
notice is legally prohibited) or requested or required by bank, securities,
insurance or investment company regulations or auditors or any administrative
body or commission (including the Securities Valuation Office of the NAIC) to
whose jurisdiction such Lender may be subject, (d) to any rating agency to the
extent required in connection with any rating to be assigned to such Lender, (e)
to assignees or participants or prospective assignees or participants who agree
to be bound by the provisions of this Section 12.10, (f) to the extent required
in connection with any litigation between any Obligor and any Creditor with
respect to the Loans or any Credit Document or (g) with Borrower's prior written
consent.
12.11. Independence of Representations, Warranties and Covenants.
---------------------------------------------------------
The representations, warranties and covenants contained herein shall be
independent of each other and no exception to any representation, warranty or
covenant shall be deemed to be an exception to any other representation,
warranty or covenant contained herein unless expressly provided, nor shall any
such exception be deemed to permit any action or omission that would be in
contravention of applicable law.
12.12. Severability. Wherever possible, each provision of this
------------
Agreement shall be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Agreement shall be prohibited by or
invalid under applicable law, such provision shall be ineffective only to the
extent of such prohibition or invalidity, without invalidating the remainder of
such provisions or the remaining provisions of this Agreement.
12.13. No Reliance on Margin Stock. Each Lender and each L/C
---------------------------
Lender represents to each Agent and each of the other Lenders and L/C Lenders
that it in good faith is not relying upon any Margin Stock as collateral in the
extension or maintenance of the credit provided for in this Agreement.
[Signature Pages Follow]
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed and delivered as of the day and year first above written.
IMAGISTICS INTERNATIONAL INC.
By: ____________________________________________
Name:
Title:
Address for Notices: MSC 17-01
000 Xxxxxxx Xxxxx
Xxxxxxxx, XX 00000-0000
Contact Person: Xxxx X. Xxxxx
Telecopier No.: (000) 000-0000
Telephone No.: (000) 000-0000
S-1
GUARANTORS
----------
Each as a Guarantor and Pledgor
By: ____________________________________________
Name:
Title:
S-2
FLEET CAPITAL CORPORATION,
as Administrative Agent and as a Lender
By: ____________________________________________
Name:
Title:
Address for Notices:
000 Xxxxxxxxxxx Xxxxxxxxx
Xxxxxxxxxxx, Xxxxxxxxxxx 00000
Attention:
Telecopier No.:
Telephone No.:
S-3
LENDERS
-------
XXXXXXX XXXXX CAPITAL CORPORATION,
as a Lender
By:_______________________________
Name:
Title:
Lending Office for all Loans:
World Financial Center
x/x Xxxxxxx Xxxxx & Xx.
Xxxxx Xxxxx - 0xx Xxxxx
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Address for Notices:
World Financial Center
x/x Xxxxxxx Xxxxx & Xx.
Xxxxx Xxxxx
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Attention: [ ]
Telecopier No.: (212) 449-[ ]
Telephone No.: (212) 449-[ ]
S-4
[NAME],
as a Lender
By:_______________________________
Name:
Title:
Lending Office for all Loans:
Attention:
Telecopier No.:
Address for Notices:
Attention:
Telecopier No.:
Telephone No.:
S-5
ANNEX A
-------
COMMITMENTS
Allocation
----------------------------- --------------------------------------------------------
Revolving Term B Facility
Institution Commitments Commitments Total
----------------------------- ------------ ---------------- ------------
Xxxxxxx Xxxxx
Capital Corporation
Fleet Capital Corporation
Mizuho Financial Group
Total $125,000,000 $100,000,000 $225,000,000
============ ============ ============
SCHEDULE 1.01(a)
----------------
LIBOR Loans ABR Loans
----------- ---------
Revolving Loans 2.75% 1.75%
Term B Facility Loans 3.50% 2.50%
SCHEDULE 1.01(b)
----------------
Revolving Loans
--------------------------------------------------------------------
Tier Total LIBOR ABR
Leverage MARGIN MARGIN
Ratio
--------------------------------------------------------------------
I greater than 1.25:1.0 3.00% 2.00%
--------------------------------------------------------------------
II less than or equal to 1.25:1.0
but greater than 1.00:1.0 2.75% 1.75%
--------------------------------------------------------------------
III less than or equal to 1.00:1.0
but greater than 0.75:1.0 2.50% 1.50%
--------------------------------------------------------------------
IV less than or equal to 0.75:1.0 2.25% 1.25%
--------------------------------------------------------------------
Term B Facility Loans
--------------------------------------------------------------------
Tier Total LIBOR ABR
Leverage MARGIN MARGIN
Ratio
--------------------------------------------------------------------
I greater than 1.25:1.0 3.75% 2.75%
--------------------------------------------------------------------
II less than or equal to 1.25:1.0 3.50% 2.50%
--------------------------------------------------------------------
SCHEDULE 1.01(c)
----------------
Total Leverage Ratio Applicable R/C Fee Percentage
--------------------- -----------------------------
greater than 0.75:1.0 0.5%
less than or equal to 0.75:1.0 0.375%
SCHEDULE 1.01(d)
----------------
GUARANTORS
----------
SCHEDULE 3.01(b)
----------------
AMORTIZATION PAYMENTS
TERM B
FACILITY
DATE* LOANS
-------------------------------------------- -------------------------
March 2002 $250,000
June 2002 250,000
September 2002 250,000
December 2002 250,000
March 2003 250,000
June 2003 250,000
September 2003 250,000
December 2003 250,000
March 2004 250,000
June 2004 250,000
September 2004 250,000
December 2004 250,000
March 2005 250,000
June 2005 250,000
September 2005 250,000
December 2005 250,000
March 2006 250,000
June 2006 250,000
September 2006 250,000
December 2006 250,000
March 2007 23,750,000
June 2007 23,750,000
September 2007 23,750,000
Final Maturity Date 23,750,000
------------
$100,000,000
============
_________________________
* Unless otherwise indicated, such date is the last Business Day of the
specified month.
